Croma Security Regulatory News (CSSG)

4 Dec 2006 07:02

Croma Group PLC04 December 2006 4 DECEMBER 2006 CROMA GROUP PLC ("Croma" or "the Group") FINAL RESULTS FOR THE YEAR TO 30 JUNE 2006 The Board of Croma, the AIM listed surveillance security and homeland defencespecialist, is pleased to announce its Final Results for the year to 30 June2006, which reflect an increase in turnover and reports on multiple newcontracts won and repeat business. KEY POINTS €47.4% increase in turnover like for like; •New acquisitions fully embedded and trading well; •Rapid recovery from previously announced delays; •Multiple new contracts secured, together with strong repeat business; •Heightened awareness of surveillance and homeland security needs; and •Turnover up 161% for the first four months of the current year. John French, Executive Chairman of Croma, said: "The current year has startedwell with turnover for the first four months up from £627,000 to £1,654,000, anincrease of 161 %. This increase is due to contributions from acquisitions whichare now fully integrated as well as new business from both new and existingclients throughout the Group." "The Board believes the progress to date will continue and be reflected in theresults going forward." Enquiries: Croma Group plcJohn French, Chairman & Chief Executive Mobile: 07836 722 482 Bishopsgate Communications Ltd. Tel: 020 7562 3350Dominic Barretto Mobile: 07930 450 156Jenni Herbert CHAIMAN'S STATEMENT FOR THE YEAR ENDED 30 JUNE 2006 I have pleasure in announcing the results for the Group for the year ended June2006. Financials Turnover for the year was £2,817,875 compared with £1,911,425 for thecomparative period last year, an increase of 47.4%. Losses were £1,090,474compared with £971,766 for the previous year after goodwill amortisation of£333,164 compared with £202,665 in the previous year, an increase of 12.2%. Theoperating loss, before amortisation of goodwill, increased by 7.4% on theprevious year. The performance was not as initially expected, due to delays inthe introduction of new products in one division and in the take up of thedelivery of orders from a major customer in another which adversely impactedgross margins. In addition, the acquisition of Vigilant Security (Scotland)Limited, a known lower margin business, has reduced the overall margins achievedfor the Group. I am pleased however to report that all these matters have nowbeen satisfactorily resolved, which is reflected in the improved performance atthe start of our current year, as highlighted below. The Company has in issue an instrument creating £1,000,000 Convertible LoanNotes of which £600,000 have been drawn down and has a £240,000 overdraftfacility with Barclays Bank plc. The two acquisitions scheduled for February were completed satisfactorily andmade a valuable contribution to the last quarter to the year to June 2006. Therelocation of Croma Defence Systems to Risca, South Wales to share a site withCroma Shawley, has proved to be beneficial in terms of reducing operating costsand improving general communications. Furthermore, in January, the Groupcompleted the relocation of its Head Office function to a small unit inHereford, resulting in a number of operational benefits and cost savings whichhave begun to have a beneficial effect. The current year has started well with turnover for the first four months upfrom £627,000 to £1,654,000, an increase of 164%. This increase is due tocontributions from the acquisitions which are now fully integrated, and newbusiness from new and existing clients throughout the Group. Operational Progress As mentioned, we satisfactorily completed two acquisitions during the thirdquarter of our financial year. Vigilant Security (Scotland) Limited became awholly owned subsidiary and will from the New Year trade as Croma VigilantLimited, reflecting the development of the Croma brand. I am pleased to say thecompany has seen an increase in excess of 22% in its turnover since joining theGroup and it continues to secure additional business from both existing and newcustomers. This has been a highly beneficial acquisition, resulting in avaluable contribution to the overall progress of the Group. In addition, theacquisition is proving to be increasingly successful in its specific field ofoperations, providing a range of security services in the area of assetprotection to the industrial, commercial and public utilities markets. The second acquisition was that of Photobase Limited, which will trade as CromaBiometrics Limited. As the name implies this company operates in the growingmarket of biometric identification and access-control solutions, which thecompany designs, installs, services and maintains. Recent new orders include aninstallation for a leading Police Authority, a biometrics attendance record foran international food manufacturer and a biometric visitor booking and ID systemat high security centres for a major bank. With the significant changes to the sales and marketing operation for the yeargoing forward at Croma Shawley, our CCTV operation, the Board expects to seedeveloping sales. The division has recently completed a number of new productdevelopments which are being introduced to the market including the use ofwireless technology. The initial response to these products has already resultedin orders from a major UK Police Force, an international installer anddistributor of CCTV. R&D Design Systems Limited continues to enhance its relationship as an innovatorand manufacturer of surveillance monitors with major customers operating in thedefence sector including a significant rolling contract for a worldwidemanufacturer of helicopters and a number of projects for a major internationaldefence contractor. It has also recently received its first breakthrough intothe North American defence market for its products and systems. In my ongoing role as Executive Chairman and Chief Executive, I have, forsometime, been looking to strengthen the operational capacity of the Main Board.With the successful acquisition of Vigilant, I am pleased to say we were able tobenefit from additional input from Sebastian Morley, Managing Director ofVigilant, who joined the Board of Croma Group plc in February 2006 and wasappointed Group Managing Director in May 2006. As such, Mr Morley has been ableto contribute to the day to day responsibilities in terms of managing theoperational subsidiaries, allowing me to concentrate even more on Group andcorporate issues, together with the short and medium term growth of the Group asa whole. Outlook In its present form, with four clearly defined active operations, we have madesignificant progress in our stated plan to build a solid base from which we candrive the business forward in this rapidly expanding business sector. Croma is abusiness of its time, addressing the highly topical issues of surveillance andhomeland security. Croma's products provide leading edge security solutions andproducts to commercial organisations such as Government Agencies, LocalAuthorities and Police Forces. As reported at the time of the Group's Septemberupdate, the current order book stands at circa £2.5 million - inclusive of £1million worth of contracts secured in September - underpinning the fact that theGroup is making progress on new business. As both governments and private bodies bear responsibility for the protection ofindividuals and the community as a whole, safety and security is increasinglybecoming a high priority. Croma continues to provide innovative and qualitysolutions to meet this escalating demand with their existing surveillance &counter surveillance products, systems and services. The Group's current productportfolio covers Biometrics, CCTV solutions, surveillance monitoring and assetprotection. With the improvement in trading in the current year we are well placed to beable to accelerate the growth not only of our core businesses, but continue toseek compatible acquisitions and relationships within the marketplace. I would like to take this opportunity to express my appreciation to all themanagement, staff and shareholders for their support during the year. John FrenchExecutive Chairman 4 December 2006 CONSOLIDATED PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 30 JUNE 2006 2006 2005 £ £ £ £ TurnoverContinuing operations 1,599,032 1,911,425Acquisitions 1,218,843 - -------- -------- 2,817,875 1,911,425 Cost of sales (1,567,741 (903,948) (1,535,248 --------- ---------Gross profit 1,250,134 1,007,477 Goodwill amortisation (333,164) (202,665)Other operating (2,028,660) (1,732,288)expenses --------- ---------Operating loss (1,111,690) (927,476)Continuing operations (1,116,932) (927,476)Acquisitions 5,242 - -------- --------Loss before interest (1,111,690) (927,476) Interest receivable 920 1,329Interest payable andsimilar (25,016) (46,431)charges --------- ---------Loss before taxation (1,135,786) (972,578) Taxation 45,312 812 --------- ---------Retained loss after (1,090,474) (971,766)taxation Loss per share (1.04) (0.98)p CONSOLIDATED BALANCE SHEET 30 JUNE 2006 2006 2005 £ £ £ £ Fixed assetsIntangible assets 4,949,606 2,129,106Tangible assets 237,855 98,814 -------- --------- 5,187,461 2,227,920 Current assetsStock 540,961 531,150Debtors 1,306,835 706,846Cash at bank 242,083 8,443 -------- -------- 2,089,879 1,246,439 Creditors: Amounts fallingduewithin one year (2,963,570) (1,173,133) -------- -------- Net current (liabilities)/ (873,691) 73,306assets -------- --------- Total assets less net 4,313,770 2,301,226current(liabilities)/assets Creditors: Amounts fallingdueafter more than one year (303,844) - Provision for liabilities (27,414) (1,373)andcharges -------- --------- 3,982,512 2,299,853 ======== ========= Share capital and reservesCalled up share capital 7,703,591 5,073,591Share premium account 1,272,554 1,129,421Profit and loss account (4,993,633) (3,903,159) -------- --------- Shareholders' funds 3,982,512 2,299,853 ======== ========= CONSOLIDATED CASH FLOW STATEMENTFOR THE YEAR ENDED 30 JUNE 2006 2006 2005 £ £ £ £ Net cash outflow fromoperating activities (584,346) (867,894) Return on investments andservicing of financing Interest paid (25,016) (7,005)Interest received 920 1,329 --------- -------- (24,096) (5,676) Taxation (paid)/received (128,084) 36,669 Capital expenditure andfinancial investmentPurchase of intangible assets - -Purchase of tangible assets (15,654) (20,882) --------- --------Receipts from sales of 4,875 -tangibleassets --------- -------- (10,779) (20,882)Acquisitions and disposalsPurchase of subsidiary (2,096,000) -undertakings --------- --------Net cash acquired with (151,844) -subsidiaries --------- -------- (2,247,844) - ----------- --------Cash outflow before use of (2,995,149) (857,783)liquid resources andfinancing Issue of equity share capital 2,815,133 210,400Cost of issue of shares - (6,345)Increase in other 231,203 -loansCapital element of finance (9,876) (3,260)leases --------- -------- 3,036,460 200,795 --------- ---------Increase/(decrease) in cash 41,311 (656,988) ========= ========= Financial information The financial information included in the above statement is an abridged versionof the Group's accounts for the period ended 30 June 2006, and does notconstitute statutory accounts within the meaning of Section 240 of the CompaniesAct 1985. The financial statements have not yet been approved by the Board and theAuditors' Report has yet to be signed. Therefore, these financial statementshave not yet been delivered to the Registrar of Companies. ---ends--- This information is provided by RNS The company news service from the London Stock Exchange