Calculus Vct Regulatory News (CLC)

12 May 2008 06:00

CLINICAL COMPUTING PLC 2007 PRELIMINARY RESULTS Clinical Computing Plc ("Clinical Computing", the "Company" or the "Group"), the international developer of clinical information systems for the healthcare market, announces its preliminary results for the year ended 31 December 2007. During 2007 the Group traded through three operating subsidiaries: Clinical Computing UK, Ltd. in the United Kingdom and Europe, Clinical Computing, Inc. in the United States and Clinical Computing Pty Limited in Australia. On 22 February 2008 Datanet Research Limited (a wholly owned dormant subsidiary of Clinical Computing Plc) acquired the business and certain assets and liabilities of Program Management Group Plc ("PMG"). The acquisition included approximately 50 customer contracts and PMG's project management and resource planning software. On the 28th February 2008 Datanet Research Limited changed its name to Hydra Management Limited. Financial Overview ·; Revenue increased 5.2% to £1,875,083 (2006: £1,781,658) ·; Operating costs consistent with prior year £2,717,112 (2006: £2,725,385) ·; Loss from operations reduced by 10.8% to £842,029 (2006: £943,727) ·; Loss per share of 2.0p (2006: loss 2.6p) Business Review ·; Transferred listing from Official List to AIM ·; Fundraising completed on AIM in November 2007 raising £1,810,000 to advance development of Clinical Vision Web ·; Secured reseller agreement with Gambro opening Canadian market ·; Clinical Vision Web being tested by customers with view to go-live later this year Subsequent Events ·; Acquisition of resource management software company completed ·; Further fundraising in February 2008 of £545,000 to strengthen balance sheet Commenting on Outlook, Howard Kitchner, Chairman of Clinical Computing, said: "The Group is at the early stages of an exciting partnership with a global medical technology company and together with our recent acquisition and expected release of our web based Clinical Vision solution entering the market in 2009 we hope to report decreasing operating losses in 2008 with a move to profitability in 2009." Contacts: Clinical Computing plc http://www.ccl.com Joe Marlovits, Chief Executive 020 8747 8744 Dowgate Capital Advisers Limited 020 7492 4777 James Caithie / Simon Sacerdoti Chairman's and Chief Executive's Report Business overview We are pleased to report that the Company has had a number of significant accomplishments since the interim report was published in September 2007. Since then the Company has: ·; Completed the process of moving its listing from the Official List to AIM ·; Equity placing - raising £1,810,000 (before costs) ·; Signed a reseller agreement with Gambro (a global medical technology company) ·; After the year end the Company completed the acquisition of the business and certain assets and liabilities of the Programme Management Group Plc (" PMG") and raised a further £545,000 of equity (before costs) to strengthen the Group's balance sheet Since listing on AIM in September 2007, the Company has completed two rounds of financing raising £2,355,000 (before costs) and successfully completed an acquisition of a UK based resource management software business based in Leeds. The trade and certain assets and liabilities were of PMG were acquired, and the business is now trading as Hydra Management Limited. The PMG acquisition was undertaken by the Company to strengthen its UK revenue opportunities. This acquisition adds a product portfolio which brings approximately £400,000 of annual software maintenance revenues from approximately 50 customers who are primarily UK based. The customer base using the Hydra Management products are split between the governmental and corporate sectors and there is opportunity to grow this customer base. £16,000 cash consideration was paid upon completion of the acquisition with a further deferred payment due based upon operating performance of the acquired entity. The Company can settle the deferred obligation, which is based on a formula, at its option over a period of seven years. In conjunction with this acquisition the Company placed a further 17,440,000 shares at 3.25p raising £545,000 (before costs) to support current sales efforts and to improve the Group's balance sheet strength. A previous fundraising was completed in November 2007, whereby the Company placed 60,333,333 shares at 3p, raising £1,810,000 (before costs) to provide working capital for the business primarily to support investment in staff to accelerate development of Clinical Vision Web. The Group has signed an exclusive reseller agreement covering the Canadian kidney disease market with Gambro a global medical technology company. Under the terms of this agreement, Gambro's Canadian sales team is now marketing Clinical Vision to its customer base. This agreement follows on from work that has been ongoing with Gambro's Australian subsidiary. The first Canadian contract has been agreed and others are anticipated through 2008 and 2009. Results Trading performance is showing improving results with the Group reporting increased revenues on a similar cost base when compared to the prior year. Revenues for the year ending 2007 increased 5.2% to £1,875,083 (2006: £1,781,658) and operating costs were practically unchanged at £2,717,112 (2006: £2,725,385). Loss from operations reduced by 10.8% to £842,029 (2006: £943,727). The loss for the year was 844,836 or a loss per share of 2.0p (2006: loss £843,404 or 2.6p per share). Strategy The Group's strategy of developing software products for the management of chronic disease is still its primary focus and we anticipate developing other sales channels similar to the Gambro partnership to achieve growth in the general chronic disease market. In general the board believes that the healthcare and resource management portfolios are both somewhat recession proof portfolios which should not be significantly impacted by short term reductions in general corporate spending. While both of our chosen markets present certain challenges, they are global in nature and we are exploring partnership opportunities which will over time position the Company's solutions beyond its current geographic boundaries. We believe that expansion into new geographic markets will come via strategic partners. We are now working with Gambro in Australia, Canada and New Zealand and this relationship has the potential to sell the Clinical Vision product to many other countries over time. To date the majority of revenues of the Group have been generated from direct sales channels. With respect to the Company's technical strategy, the directors continue to believe that healthcare applications delivered directly via the internet is a global healthcare trend which will continue. The Company continued its development of the Clinical Vision Web product during the year and is now working with customers to test this product outside of our development environment. Products and product development During 2007 we continued to invest in product expansion and had a number of research and development projects underway, including the development of Clinical Vision Graft Vision an application for the UK market, which was released in April 2007 and the continued development of the Clinical Vision Web product. The product development team is now focusing on an integration project for the Web solution, which will support the Company's move into the wider Chronic Kidney Disease as well as other chronic diseases. Outlook The Group is at the early stages of an exciting partnership with a global medical technology company and together with our recent acquisition and expected release of our web based Clinical Vision solution entering the market in 2009 we hope to report decreasing operating losses in 2008 with a move to profitability in 2009. H Kitchner J Marlovits Chairman Chief Executive 12 May 2008 Finance Review Results for the year The Group derived its revenue from approximately 85 healthcare organisations who are licensing one of the following products: PROTON, di-PROTON, RENLStar and CLINICAL VISION. Each of these products provides an electronic healthcare application to manage Chronic Kidney Disease, with an emphasis on End Stage Renal Disease. Total revenues for the year ending 2007 increased 5.2% to £1,875,083 (2006: £1,781,658). The majority of the Group's revenues continue to come from the US market - 63.1% in 2007 (2006: 59.7%) and on like for like exchange rates comparing revenues for 2007 and 2006 revenues increased 9.8%. Maintenance revenue for the period was £1,110,675, or 59.2% of total revenues (2006: £1,209,563 or 67.9%). The Group's total operating costs for the year were practically unchanged at £2,717,112 (2006: £2,725,385). Operations generated a loss of £842,029 (2006: loss £943,727). The loss for the year after tax was £844,836 or 2.0p per share (2006: loss £843,404 or 2.6p per share). Cash flow and debt During the year cash spent to support operations was £768,868 (2006: £984,024). In November the Company completed an equity fundraising, placing 60,333,333 1p ordinary shares at 3p raising £1,810,000 (before expenses). Following this fundraising the Company reduced the majority of its then outstanding debt with Brown Shipley and is reporting cash outflow of £647,473 for debt reduction during the year. Outstanding debt at the end of the year is £221,680 (2006: £869,153). At 31 December 2007 the Company had two debt facilities available which in total provide approximately £1,100,000 of working capital facilities with £221,680 borrowed against these facilities. The larger of the two facilities (£1,000,000) is provided by Brown Shipley on normal commercial terms, and is backed by personal guarantees of the chairman and two shareholders. A further £100,000 facility ($200,000) is provided by Fifth Third Bank in the US and is secured by the assets of the Company. Capital structure and finance The Group's consolidated equity position at 31 December 2007 was a deficit of £271,186 (2006: deficit £1,230,615). The positive change to the equity position was improved following the Company's share placing noted above which raised £1,810,000 of capital, before expenses. Offsetting this fundraising was the loss for the year of £844,836. Following approval at the Company's August 2007 EGM, the nominal value of the Company's ordinary shares was changed from 5p to 1p. This change was undertaken at a time when the Company shares were trading below its nominal value and limited its ability to raise further equity. The effect of this change sub-divided each then issued 5p share (33,110,361 5p shares) into one share of 1p ordinary and one deferred share of 4p. The 4p deferred shares do not trade, have no value, no right to receive a dividend, no voting rights and are not transferable (other than to the Company). No share certificates have been issued in respect of the deferred shares. Also at the August 2007 EGM the company increased its authorised ordinary share capital to 167,558,556 1p ordinary shares by subdividing the authorised but unissued 5p ordinary shares into five 1p ordinary shares and authorising 70,000,000 additional new ordinary 1p shares. In February 2008, in conjunction with the acquisition of the PMG business, the Company issued a further 17,440,000 shares at 3.25p raising an additional £545,000 (before expenses) of capital for the Group. The Company's current issued shares and total voting capital consists of 110,883,694 1p ordinary shares. Software development During the year under review the development team primarily focused its efforts on three major projects: completing the UK transplant application, further development and quality assurance testing of the Clinical Vision Web product and a product update to the Clinical Vision 4 product suite. In April 2007 the Group completed development of the UK transplant application and this product has now been released to two customers. £62,435 of cost was capitalised as an intangible asset for this product and an amortisation charge to the income statement of £10,406 was made during the year (2006: nil). The Clinical Vision Web project reached an appropriate stage whereby costs of this project are now being capitalised as an intangible asset. This project is still under development and has not yet been released to any customers and at year end £146,076 has been recorded as an intangible asset. Additionally, during the year the development team completed a product update for Clinical Vision all costs with respect to this update were charged to the income statement. Foreign currency risk The company's US trading subsidiary trades in its local currency, the US dollar, and no hedging activity between sterling and the US dollar is undertaken. This subsidiary generated 63.1% of the Group's total revenue (£1,063,614) and 32.5% of its operating costs (£883,080) in US dollars. During the year this subsidiary was cash generating. Additionally, the company has a subsidiary in Australia. Receipts and payments are in the local currency and no hedging activity is undertaken. During the year this subsidiary was cash generating. The charge to the income statement for foreign currency transactions was £483 (2006: £24,474) Taxation The Company and all subsidiaries have sufficient tax losses such that no income tax expense has been recognised during the year. However, for the year under review, the Group through its UK trading subsidiary filed a research and development ("R&D") tax credit claim with respect to activities undertaken in 2006 on various components of the Clinical Vision product. An election was made, under the terms of the current United Kingdom R&D tax credit regime, for a percentage of the R&D expenditure to be settled in cash. A tax credit in the amount of £68,517 has been reported and received in 2007. A similar R&D claim was made for activities undertaken in 2005 and settled in cash during 2006 for £121,234. S Gandhi Finance Director 12 May 2008 Consolidated Income Statement For the year ended 31 December 2007 Notes Unaudited Audited 2007 2006 £ £ Continuing Operations Revenue 2 1,875,083 1,781,658 Cost of sales (741,453) (711,663) __________ __________ Gross profit 1,133,630 1,069,995 Distribution costs (245,496) (371,830) Administrative expenses Research and development (890,434) (965,120) Other (839,729) (676,772) Total administrative expenses (1,730,163) (1,641,892) __________ __________ Loss from operations (842,029) (943,727) Finance income 6,220 2,565 Finance expense (77,544) (23,476) __________ __________ Loss before tax (913,353) (964,638) Income tax credit 68,517 121,234 __________ __________ Loss for the year attributable to equity holders of the company (844,836) (843,404) __________ __________ Basic and diluted loss per share 5 (2.0p) (2.6p) __________ __________ Consolidated Statement of Recognised Income and Expense For the year ended 31 December 2007 Unaudited Audited 2007 2006 £ £ Loss for the year (844,836) (843,404) Exchange difference on translation of foreign operations 11,063 69,243 __________ __________ Total recognised income and expense for the year (833,773) (774,161) __________ __________ Consolidated Balance Sheet As at 31 December 2007 Notes Unaudited Audited 2007 2006 £ £ Non-current assets Intangible assets 198,105 29,360 Property, plant and equipment 137,871 146,141 __________ __________ 335,976 175,501 __________ __________ Current assets Trade and other receivables 361,253 353,001 Cash and cash equivalents 164,365 14,418 __________ __________ 525,618 367,419 __________ __________ Total assets 861,594 542,920 __________ __________ Current liabilities Trade and other payables (911,100) (904,382) Bank loans (221,680) (869,153) __________ __________ (1,132,780) (1,773,535) __________ __________ Net liabilities (271,186) (1,230,615) _________ _________ Equity Share capital 4 2,258,851 1,655,518 Share premium account 4 7,326,133 6,149,063 Share option reserve 4 71,375 58,576 Translation reserve 4 158,843 147,780 Retained earnings 4 (10,086,388) (9,241,552) __________ __________ Shareholders' funds - deficit (271,186) (1,230,615) _________ _________ Consolidated Cash Flow Statement For the year ended 31 December 2007 Notes Unaudited Audited 2007 2006 £ £ Net cash from operating activities 6 (768,868) (984,024) __________ __________ Investing activities Interest received 6,220 2,565 Expenditure on product development (179,151) (29,360) Purchases of property, plant and equipment (40,643) (113,972) __________ __________ Net cash used in investing activities (213,574) (140,767) __________ __________ Financing activities Proceeds from equity issue 1,810,000 102,375 Costs of equity issue (29,597) - (Decrease) increase in bank loan (647,473) 869,153 __________ __________ Net cash from financing activities 1,132,930 971,528 __________ __________ Net increase (decrease) in cash and cash equivalents 150,488 (153,263) Cash and cash equivalents at beginning of year 14,418 173,010 Effect of foreign exchange rate changes (541) (5,329) __________ __________ Cash and cash equivalents at end of year 164,365 14,418 __________ __________ Notes 1. Basis of preparation The unaudited preliminary announcement has been prepared under the historical cost convention, on a going concern basis and consistent with applicable International Financial Reporting Standards and IFRIC interpretations ("IFRS") as adopted by the EU. The preliminary announcement has been prepared on the basis of the same accounting policies as published in the statutory accounts for the year ended 31 December 2006. The financial information set out in this preliminary announcement was approved by the board on 12 May 2008 and does not constitute statutory financial statements as defined by section 240 of the Companies Act 1985. The statutory accounts for the year ended 31 December 2007 have not yet been delivered to the Registrar of Companies and no audit report has yet been given on the statutory financials statements. Statutory accounts for the year ended 31 December 2006 have been delivered to the Registrar of Companies. The audit report on these statutory accounts was unqualified and did not contain a statement either under section 237(2) or 237 (3) of the Companies Act. The Annual Report and Accounts for the year ended 31 December 2007 will be posted to shareholders in due course and will be available on the Company's website simultaneously with posting. 2. Revenue Unaudited Audited An analysis of the Group's revenue is as follows: Year Year ended ended 2007 2006 £ £ Software licenses 613,263 425,914 Maintenance 1,110,675 1,209,563 Services and other revenue 151,145 146,181 __________ __________ Revenue 1,875,083 1,781,658 __________ __________ 3. Business and geographical segments For management and legal purposes, the Group consists of three operating companies and the parent company. These companies are the basis on which the Group reports its primary segment information. The business operations provide software, maintenance and services to the healthcare sector and there is no significant difference between risk and return on the software and services offered. Therefore there is only one business segment reported across geographic segments. The geographic segmental information presented below excludes any intra-group revenue or expense. Segmental information is presented below. US UK Australia Unallocated Total £ £ £ £ £ 2007 - Unaudited Revenue Total Revenue 1,182,404 641,351 51,328 - 1,875,083 __________ __________ _______ __________ __________ Segment result Operating profit (loss) 299,324 (824,335) 44,523 (361,541) (842,029) __________ __________ ________ __________ __________ Finance income 6,220 Finance expense (77,544) __________ Loss before tax (913,353) Income tax credit 68,517 __________ Loss for the year attributable to equity holders of the company (844,836) __________ Balance sheet Segment assets 172,791 464,450 40,545 183,808 861,594 _________ Segment liabilities (413,132) (397,555) (3,355) (97,058) (911,100) Current borrowings (221,680) (221,680) __________ Total liabilities (1,132,780) Other information Capital Expenditure 22,178 197,616 - - 219,794 Depreciation 21,879 34,176 - 2,854 58,909 Amortisation - 10,406 - - 10,406 US UK Australia Unallocated Total £ £ £ £ £ 2006 - Audited Revenue Total Revenue 1,063,614 578,495 139,549 - 1,781,658 __________ __________ ________ __________ __________ Segment result Operating loss (36,406) (788,082) 103,605 (222,844) (943,727) __________ __________ ________ __________ __________ Finance income 2,565 Finance expense (23,476) __________ Loss before tax (964,638) Income tax credit 121,234 __________ Loss for the year attributable to equity holders of the company (843,404) __________ Balance sheet Segment assets 75,869 370,665 40,666 55,721 542,920 __________ Segment liabilities (413,564) (421,813) (528) (68,477) (904,382) Current borrowings (869,153) (869,153) __________ Total liabilities (1,773,535) Other information Capital Expenditure 11,176 132,156 - - 143,332 Depreciation 27,066 13,343 36 3,595 44,040 Amortisation - - - - - 4. Reconciliation of movements in equity - Unaudited Share premium Share Share account option Translation Retained Total Capital reserve reserve earnings £ £ £ £ £ £ At 1 January 2006 1,576,768 6,125,438 37,655 78,537 (8,398,148) (579,750) Share options - - 20,921 - - 20,921 Exchange difference on translation of foreign operations - - - 69,243 - 69,243 Issue of equity shares 78,750 23,625 - - - 102,375 Loss for the year - - - - (843,404) (843,404) __________ __________ _________ __________ __________ __________ At 31 December 2006 1,655,518 6,149,063 58,576 147,780 (9,241,552) (1,230,615) Share options - - 12,799 - - 12,799 Exchange difference on translation of foreign operations - - - 11,063 - 11,063 Issue of equity shares 603,333 1,206,667 - - - 1,810,000 Expenses from issue of - (29,597) - - - (29,597) equity Loss for the year - - - - (844,836) (844,836) __________ __________ _________ __________ __________ __________ At 31 December 2007 2,258,851 7,326,133 71,375 158,843 (10,086,388) (271,186) __________ __________ _________ __________ __________ __________ 5. Loss per share The calculation of the basic and diluted earnings per share is based on the following data: Unaudited Audited 2007 2006 £ £ Earnings Earnings for the purposes of basic and diluted earnings per share (844,836) (843,404) __________ __________ Number of shares Number Number Weighted average number of ordinary shares for the purposes of basic and diluted earnings per share 42,729,082 32,411,320 __________ __________ The calculations of basic and diluted losses per share are the same because the effect of including share options would be anti-dilutive and are excluded from the calculation per IAS 33. 6. Notes to the cash flow statement Unaudited Audited 2007 2006 £ £ Loss from operations (842,029) (943,727) Adjustments for: Depreciation of property, plant and equipment 58,909 44,040 Amortisation of intangible assets 10,406 - Share option charges 12,799 20,921 __________ __________ Operating cash flows before movements in working capital (759,915) (878,766) (Increase) decrease in receivables (10,783) 1,208 Increase (decrease) in payables 10,857 (204,224) __________ __________ Cash used by operations (759,841) (1,081,781) Interest paid (77,544) (23,476) Tax credit received 68,517 121,234 __________ __________ Net cash from operating activities (768,868) (984,024) __________ __________ ENDFR UKAVRWBRVRAR