Atlantic Lithium Regulatory News (ALL)

30 Jul 2007 07:00

Manpower Software PLC30 July 2007 MANPOWER SOFTWARE PLC (THE "COMPANY") RESULTS FOR THE YEAR ENDED 31 MAY 2007 CHAIRMAN'S STATEMENT Results Manpower Software plc, the leading provider of workforce management solutions,today announces its results for the year ended 31 May 2007. • Revenue in the second half of the financial year was £4.25m (first half: £4.05m), making £8.3m for the year as a whole, an increase over last year of 92%. This represents the highest revenue achievement in the Company's history. • Trading profit in the second half, before adjustments for share-based payments and interest, was £595k (first half: £476k). For the year as a whole, trading profit was £1.07m, also the highest in the Company's history, (2006 re-stated: a loss of £1.76m). • A resulting net operating margin of 13%. • Cash balances at the year-end increased to £2.4m (2006: £0.36m). This success stems from decisions taken eighteen months ago. Then, while it wasevident that Manpower Software had superior products, an impressive customerbase and outstanding people, it was also clear that greater focus needed to beplaced on the basic tenets of a successful software company: • linearity of licence revenue growth through consecutive periods;• strong margins in services and support revenues;• investments directed only in high productivity activities;• diligent expense management. I am pleased to report significant progress in each of these areas. Linearity of licence revenue In addition to its traditional Defence and Maritime markets, Manpower Softwareinvested to capitalise on its early successes with NHS Trusts. This resulted inthe achievement during the year of a further 10 contracts with NHS Trusts forthe Company's powerful rostering solutions and one with a private healthcarecompany, thus providing a steady flow of licence revenue. In addition, ManpowerSoftware entered the current financial year (ending 31 May 2008) with a strongpipeline of further opportunities within the NHS. Strong margins in service and support revenues In the year ended 31 May 2007, revenues from services and support were asubstantial part of our business and grew by 59%, delivering operating marginsconsistent with the best industry standards. Investments in high productivity activities Use of improved performance metrics and a new incentive structure throughout theCompany to drive increased revenues and margins together resulted in thenecessary focus on improved productivity throughout the Company. ManpowerSoftware was therefore able to achieve the combination of rapid growth andimproved margins. Diligent expense management The Company used a comprehensive range of revenue and expense metrics to ensureG&A expense was kept to a minimum and investments in sales and marketing,services and support, and R&D were carefully managed. All measured ratiosshowed considerable improvement over the prior year. This complemented ourefforts to grow revenues and enabled us to deliver improved operating marginsacross the business. Achievements with each of these important structural aspects of our business hasensured the Company's profitability across all parts of its business, while alsoachieving exceptionally high levels of customer satisfaction. In addition to the Company's best ever financial results, a number ofsignificant milestones were also achieved during the year. • First Asia-Pacific military contract - Royal Australian Navy; • First significant contract with the UK Royal Air Force; • Significant and consistent growth in the UK NHS, up from 5 to 15 customers - additionally, since the year-end a further 7 contracts have been closed; • First contract in the Private Healthcare sector - HCA International; • Two contracts in new markets: Construction and Off-Shore Engineering. Operational Review Defence Defence represented the largest sector of our business. We continue to providesoftware and services to the existing customer base and are expanding to othercustomers in the UK and overseas. We announced earlier in the year our firstsale to an Asia-Pacific military customer, the Royal Australian Navy, anddiscussions are now under way with other potential Defence customers in theregion. The British Army further extended its use of MAPS, to enable the Army'sLand Headquarters to plan and deliver future operational commitments, against abackground of competing operational, training, resource and financial demands.This is a significant achievement for the Company and it places our products atthe centre of the Army's planning process. The Royal Air Force selected MAPS tomanage force planning, intelligent force selection and training for the RAFReserves. The Royal Fleet Auxiliary ("RFA") procured an enterprise-widelicence, increasing their use of MAPS throughout its Fleet and demonstratingtheir continued commitment to MAPS that stretches over 10 years. Therefore ourMAPS system is now used by all three UK Armed Services. It was also used byNATO for the second year in succession at the annual Global Force Generationconference in November 2006. We are now providing NATO with a permanentsolution to address the complexities of force generation and support the membernations. Healthcare Healthcare is the fastest growing part of our business. During the year thecustomer base of NHS Trusts increased from 5 to 15. Since the year-end, we havesigned contracts with a further 7 Trusts, making a current total of 22 acrossAcute and Mental Health Trusts. In all cases MAPS Healthroster was selectedbecause of its unique functionality, the size of potential time and cost savingsidentified, its intuitive nature and our growing track record at existingTrusts. Two of our customers were selected by the National Audit Office asexamples of good practice in managing the use of temporary nursing staff. We have successfully integrated MAPS Healthroster with the National HumanResources and Payroll System - NHS Electronic Staff Records ("ESR"). This meansTrusts using Healthroster can pay staff electronically without the need forpaper timesheets, representing a significant time saving and increasing theaccuracy of pay. In the private sector, we are now supplying MAPS Healthroster to the HospitalCorporation of America ("HCA"), London's largest private hospital group and oneof the largest providers of healthcare in the USA. Before deciding to use MAPSHealthroster for their UK based hospitals, HCA undertook an extensive evaluationof alternative rostering solutions, including US based competitors. HCA'sdecision to purchase MAPS Healthroster supports our view that the Company has asignificant opportunity to extend the use of MAPS Healthroster further into theprivate sector, both in the UK and overseas. The 22 NHS installations of our MAPS Healthroster software are generating strongreferenceable results and further Trusts are continuing to evaluate ourrostering solutions under contract. These successes are resulting in anincreased momentum that is building further demand across the NHS. The Companyis focused on expanding the direct and indirect sales capabilities into thismarket, enhancing the product proposition and shortening product procurementtimescales. Maritime The Company continued to strengthen its dominant position for crew planning inthe global Cruise and Maritime sector. During the year, the Shoreside system atPrincess Cruises was enhanced by the progressive roll-out to the ships, whichshould be in full operation using MAPS during the current financial year, and APMoller Group further extended its use of MAPS to Maersk Ship Management. Amajor milestone was achieved with the completion of a complex implementation andsubsequent live operation at Carnival Cruise Lines. Shortly after the year-end,the Company won its first French customer when CMA CGM, the largest Frenchshipping company, decided to use MAPS for fleet management. Other Sectors During the year, the Company achieved its first sales outside its core verticalmarkets. First, through our partner, Alphawest Services, Leighton Contractors,the Australian mining and engineering company, purchased the MAPS system tomanage staff in their Construction Projects throughout Australia and their minesin Western Australia. Second, Acergy, the global Off-Shore Engineering group,purchased MAPS for global personnel planning of their marine staff and projectengineers. It is our view that these successes, together with our existing success storiesachieved in areas as diverse as Defence, Maritime and Healthcare, areillustrative of the power of the MAPS solution for workforce management in largeto medium sized organisations. Further, we believe it can be replicated intoother sectors that have similar workforce characteristics. Management iscurrently assessing the optimum potential areas to address. Client Services As mentioned above, Client Services is now a fast growing and profitable part ofour business. Key to this are the high levels of customer satisfaction beingdelivered across all three sectors. During the year, we appointed our firstservices partner for the UK Healthcare sector and established an Educationfunction for internal and partner training to accelerate the use of MAPSHealthroster. There is a strong pipeline of work going into the new financialyear. Research & Development The products for our market sectors are based upon a common MAPS platform, whichis customised and branded by industry. During the year we have built upon thesuccessful launch of MAPS Defence Suite and the established MAPS Healthrosterproducts in accordance with their planned industry sector roadmaps; the new MAPSMaritime Suite has also provided an entry-level product for the Shipping andOff-Shore Engineering sectors. Increasingly, traditional means of deliveringfunctionality to users is being supplemented by web-enabled applications in eachof our vertical markets. Thus, management dashboards for NHS executives andmanagers in Healthcare, operational and training event management in Defence,and (shortly) ship-side vessel management in Maritime. As well as the existingprogramme of product development to support our chosen markets, we are alsoexecuting a technology roadmap, which will provide a technical platform forfuture product development and enhance capability to deliver high performance,large-scale international applications. Board Changes As announced on 22 May 2007, we are delighted that Ian Bowles has joined us asour new CEO. His background in enterprise software, considerable experience inbuilding application software companies on a global basis and proven ability tosuccessfully execute against an ambitious operating plan will be vital as theCompany gears up for future growth in existing and new markets. Share-based payments The adoption of FRS 20, Share-Based Payments, which is effective for accountingperiods beginning after 1 January 2006, requires a prior year adjustment to bemade. This has created a share-based payment reserve at 31 May 2007 of £210,166and increased retained losses by the same amount. The charge for the year is £75,225 (2006: £69,835). This is an accountingadjustment, which has no impact on the Company's trading position and is shownseparately on the face of the Profit and Loss Account. Outlook Our strategy remains to be the leading provider of workforce managementsolutions to our chosen markets. Across all sectors, the following essential elements are in place to drivecontinued expansion: • Strategic vision. Our vision remains fixed upon being the world's foremost supplier of workforce optimisation systems in our chosen markets, thereby enabling our customers to achieve effective and efficient use of their most important resource, their people. • Customer satisfaction. The strongest sales multiplier we have is referenceable customers. We will not deviate from maintaining a high level of customer satisfaction in each of our chosen markets in order to achieve further referenceable sites and a high level of individual customer satisfaction. • Integrated solution. We offer our customers a product portfolio that meets the full range of their business needs across our core strength areas of workforce planning, staff scheduling and resource management. • Multiple growth drivers. Our MAPS products lend themselves to other vertical markets and, based upon our assessment of their potential, we plan to add these to our portfolio. In addition to growing our direct sales and services teams, we intend to expand our capacity by the increasing use of strategic partnerships. These will enable us to extend our penetration of existing geographical markets and reach new territories. • Profitability. We are focused on achieving profitable growth and positive cash flow, which will enable us to invest in new products and resources that advance our strategic vision. • A committed team. From product development to sales and marketing, and through to customer service, we are committed to delivering the highest quality product solutions to our customers. Recruiting and retaining world-class team members is key to our success. Management has established firm foundations for continuing profitable growth.We have invested in our direct sales organisation and in a services businesscapable of fulfilling the increasing demands of our target markets. There isnow a strong sales pipeline and the capability to deliver profitable servicesgrowth. We are also actively seeking new partnerships to assist with sales anddelivery in our worldwide markets. In Defence, we have opportunities to supply further products and supportservices to the UK Armed Forces and NATO. There is also wider interest in ourproducts from government and commercial organisations in the Asia Pacificregion. The latest version of MAPS Defence Suite has been released to focus onCapability Management, enabling commanders to assess the true impact ofdifferent courses of action, in terms of both capability and cost. It has beenenthusiastically received by those organisations that have viewed it and weanticipate most of our customers migrating to it over the medium term. In Healthcare, there are now 22 NHS Trusts which are committed to using our MAPSHealthroster product. This represents less than 10% of the Acute and MentalHealth market. We anticipate that the increasing focus throughout the NHS onimproving productivity, controlling temporary staff spend and improving patientcare, allied with the Company's increased geographical expansion throughout theUK and the completion of current pilots, will lead to continued growth in sales. We will continue to expand into the sector, both in the UK and overseas. In Cruise and Maritime, while we remain primarily focused upon the needs of ourexisting customers, we are targeting further penetration into the broadershipping market. Presently, we have opportunities to sell additional MAPSlicences and services to our established customers as well as the mid-rangecruise fleets and in shipping, where the successful implementations of oursoftware at AP Moller-Maersk is generating interest. Regarding other sectors, it is our view that the successes achieved in theConstruction and Off-Shore Engineering markets are illustrative of the power ofthe MAPS solution for workforce management in large to medium sizedorganisations. As mentioned above, Management is currently assessing theoptimum potential areas to address in other sectors that have similar workforcecharacteristics. In Services, there is now a strong pipeline of work to be delivered whichstretches throughout the current financial year. We have reported previously that the Company is highly dependent on a smallnumber of large contracts in markets where considerable change is occurring,where the sales cycles are often long and complex, and where forecasting theprecise timing of closure has become more difficult. Deferral or accelerationof only a few of these can have a significant impact on the Company's results.While this remains true, the combination of the profitable Group service andsupport operations, and the sales of MAPS Healthroster to the NHS Trusts, aretogether having a smoothing effect on the Company's ability to achieveconsistent and improving profits. The directors are confident of anothersuccessful year and of meeting current stock market expectations. I would like to thank our customers for their business, enthusiastic use of ourworkforce optimisation solutions and unstinting support for our growthstrategies. And finally, I would like to recognise and thank all of ManpowerSoftware's people for their unbounded commitment, energy and enthusiasm for theCompany's success. Terry OsborneCHAIRMAN30 July 2007 MANPOWER SOFTWARE PLC CONSOLIDATED PROFIT AND LOSS ACCOUNT For the year ended 31 MAY 2007 Note 2007 2006 As restated £ £ Turnover 1 8,305,628 4,333,238 Cost of sales (5,679,649) (4,665,363) Gross profit/(loss) 2,625,979 (332,125) Administrative expenses (1,555,529) (1,423,515) Profit/(loss) before share-based payment, interest and tax 1,070,450 (1,755,640) Share-based payment (75,225) (69,835) Total administrative expenses including share-based payments (1,630,754) (1,493,350) Operating profit/(loss) 995,225 (1,825,475) Net interest 14,405 10,407 Profit/(loss) on ordinary activities before taxation 1,009,630 (1,815,068) Tax on profit/(loss) on ordinary activities 2 - (3,905) Profit/(loss) retained and transferred to reserves 1,009,630 (1,818,973) Earnings/(loss) per shareBasic 4 2.27p (4.12p) Diluted 4 2.20p (4.12p) All transactions arose from continuing operations. CONSOLIdATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES Note 2007 2006 As restated £ £ Profit/(loss) for the financial year 1,009,630 (1,818,973)Currency differences on opening reserves 75,120 19,410Total recognised gains and losses for the year 1,084,750 (1,799,563) The accompanying accounting policies and notes form an integral part of thesefinancial statements. MANPOWER SOFTWARE PLC CONSOLIDATED BALANCE SHEET AT 31 MAY 2007 Note 2007 2006 As restated £ £Fixed assetsTangible assets 153,413 89,124 Current assetsDebtors 1,738,455 2,219,493Cash at bank and in hand 2,409,409 355,394 4,147,864 2,574,887 Creditors: amounts falling due within one year (2,207,696) (1,743,224) Net current assets 1,940,168 831,663 Total assets less current liabilities 2,093,581 920,787 Capital and reservesCalled up share capital 2,226,991 2,223,154Share premium account 6,465,281 6,456,299Share-based payment reserve 210,166 134,941Profit and loss account (6,808,857) (7,893,607)Shareholders' funds 2,093,581 920,787 The accompanying accounting policies and notes form an integral part of thesefinancial statements. MANPOWER SOFTWARE PLC CONSOLIDATED CASH FLOW STATEMENT For the year ended 31 MAY 2007 Note 2007 2006 As restated £ £ Net cash inflow/(outflow) from operating activities 5 2,175,720 (1,067,569) Returns on investments and servicing of financeInterest received 18,573 10,407Interest paid (4,168) -Net cash inflow from returns on investments and servicing of finance 14,405 10,407 Taxation - (3,905) Capital expenditurePurchase of tangible fixed assets (148,929) (49,376)Cash inflow/(outflow) before financing and management of liquid resources 2,041,196 (1,110,443) FinancingIssue of ordinary shares 12,819 -Net cash inflow from financing 7 12,819 - Increase/(decrease) in cash 6 2,054,015 (1,110,443) The accompanying accounting policies and notes form an integral part of thesefinancial statements. 1 BASIS OF PREPARATION The Group has applied the requirements of Financial Reporting Standard 20 ("FRS20"), Share-Based Payments, in accordance with the transitional provisions, toall equity instruments granted after 7 November 2002 that had not vested as of 1June 2006. As a result, the loss for the year to 31 May 2006 has been restatedby £69,835, but there is no impact on net assets or cash flow. The financial information set out in this announcement does not constitutestatutory accounts as defined in Section 240 of the Companies Act 1985. This announcement includes extracts from the audited statutory accounts for theyear ended 31 May 2007. The comparative figures relating to the year ended 31May 2006 are taken from the audited statutory accounts for that year, except asnoted above in relation to the FRS 20 restatement. 2 TAX ON PROFIT/(LOSS) ON ORDINARY ACTIVITIES The tax charge for the year was £nil (2006: £3,905). 3 DIVIDENDS No dividends were paid or proposed during either 2007 or 2006. 4 EARNINGS PER ORDINARY SHARE 31 May 2007 31 May 2006 As restated £ £ Profit/(loss) for the year 1,009,630 (1,818,973) Weighted average number of shares Number Number of shares of shares For basic earnings per share 44,539,813 44,463,086For diluted earnings per share 45,844,185 44,463,086 In 2006, as the result is a loss for the period, there is no difference betweenthe diluted loss per share and the loss per share presented. In view of the significant impact of the FRS 20 share-based payment charge onearnings per share calculated in accordance with FRS 22 (Earnings Per Share), anadjusted earnings per share figure has been provided based on profit on ordinaryactivities after taxation before the share-based payment charge of £75,225(2006: £69,835). 31 May 2007 31 May 2006 Basic adjusted earnings per share 2.44p (3.93)pDiluted adjusted earnings per share 2.37p (3.93)p 5 NET CASH INFLOW/(OUTFLOW) FROM OPERATING ACTIVITIES 2007 2006 As restated £ £ Operating profit/(loss) 995,225 (1,825,475)Share-based payment 75,225 69,835Depreciation charges 81,711 80,205Currency movements 76,541 18,639Decrease in debtors 481,038 765,979Increase/(decrease) in creditors 465,980 (176,752)Net cash inflow/(outflow) from operating activities 2,175,720 (1,067,569) 6 RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET FUNDS 2007 2006 £ £ Increase/(decrease) in cash in the year 2,054,015 (1,110,443)Net funds at beginning of the year 355,394 1,465,837Net funds at end of the year 2,409,409 355,394 7 ANALYSIS OF CHANGES IN NET FUNDS At 1 June Cash flow At 31 May 2006 2007 £ £ £ Cash at bank and in hand 355,394 2,054,015 2,409,409 A copy of the annual report and accounts will be sent to all shareholders. Acopy of this preliminary announcement is available from the company's registeredoffice: The Communications Building, 1st Floor, 48 Leicester Square, London WC2H7LU. This information is provided by RNS The company news service from the London Stock Exchange