Last checked at 29 Mar 2012 07:00
Getech Group plc
("GETECH" or the "Company")
Interim results for the six months ended 31 January 2012
GETECH (AIM:GTC), a leading geosciences business specialising in the provision of data, studies and interpretation services to the oil, gas and mining exploration sectors, announces interim results for the six months ended 31 January 2012.
Highlights
• | Revenue for the six months of £3,193,000 (six months ended 31 January 2011: £2,653,000) representing growth of 20%; |
• | Profit before tax of £358,000 (six months ended 31 January 2011: £294,000) representing growth of 22%; |
• | Interim dividend proposed 0.2p per share (2011: no interim dividend); |
• | Strong oil price continues to underpin exploration commitments; |
• | Cash levels recovering with gross cash of £1,871,000. |
Stuart Paton, Non-Executive Chairman of GETECH Group plc, said:
"With the strong demand for our data along with the benefits from the investment in our Global Programmes interpretative data project, we remain positive about our medium and long-term prospects. We continue to devote significant effort to research projects and looking at new areas of business that we are confident will lead to revenue growth in the future."
For further information, please contact:
GETECH Group plc Raymond Wolfson, Chief Executive |
| Tel: 0113 322 2200 |
WH Ireland Limited Katy Mitchell |
| Tel: 0161 832 2174
|
Walbrook PR Helen Westaway |
| Tel: 020 7933 8790 |
Chairman's statement
I report on the interim accounts of GETECH and its subsidiary company (collectively "GETECH"), the geoscience business specialising in theprovision of data, studies and services to the petroleum and mining exploration sectors, for the six month period ended 31 January 2012.
Results
GETECH is pleased to report a Group profit before tax of £358,000 (six months ended 31 January 2011: £294,000) after interest receivable of £3,000 (six months ended 31 January 2011: £3,000) on revenue of £3,193,000 (six months ended 31 January 2011: £2,653,000). The post-tax profit was £292,000 (six months ended 31 January 2011: £216,000).
The accounts have been prepared under IFRS as adopted by the EU.
Dividend
Your Board recommends an interim dividend of 0.2p per share to be paid on 8 May 2012 to shareholders on the register at the close of business on 10 April 2012.
Business review
We believe the strong oil price has resulted in E&P companies continuing to increase expenditure on exploration which has led to strengthening demand for our products. This has resulted in a further half year-on-half year increase in revenue performance. This increase in revenue has been primarily due to the continuing strength of demand for our data. In August we announced a further sale of the Iraq data-set with gross revenue in excess of $500,000 and in October we announced a major sale of Russian data with gross revenue of $550,000.
During the half year under review, we have also begun to see the benefits from the investment in our Global Programmes interpretative data project. This new project, which will take three years to complete, comprises the essential tectonic and palaeogeographic context for understanding basin geodynamics and source-to-sink relationships (essentially how the geology and a geography of a basin have changed over time). The first sponsorship agreement for the programme was signed in December 2011 and the second in early February 2012. These sponsorship agreements provide consistent income from the sponsors who are committed to a three year package, and hence provide improved forward visibility on revenue. GETECH has invested substantially in the work to develop the first year deliverables and these are now available to all sponsors on signature. Work has commenced on the second year deliverables and we continue to seek further sponsors.
We have continued to repay the principal amounts on the loan that we negotiated in 2009 and the cash balance has recovered towards levels which are more normal for us. At 31 January 2012 the gross cash stood at £1,871,000.
Outlook
Looking forward to the second half of this financial year, we anticipate several further new sponsors for our Global Programmes. As we are now able to ship the first year deliverables, a substantial proportion of each new commitment falls immediately to profit. We remain confident that data sales will continue to be strong and are very pleased that the level of proprietary work is also growing. In addition to substantial projects, we are also seeing increased demand for consultancy services, driven in part by the increasing awareness of the Global Programmes and the ongoing presence at major international conferences. Further, we are devoting significant effort to research projects and looking at new areas of business that we are confident will lead to revenue growth in the future.
The oil price has remained strong, typically above $100 per barrel, which is encouraging for exploration in general and for our part of the market in particular.
GETECH's results for the year are, as usual, dependent on finalising a number of deals and the pattern of demand in the remaining few months of the year. However, we already have a significant level of committed income for the next two years and believe this will be reflected in our financial performance.
We remain confident about our medium and long-term prospects.
Dr Stuart Paton
Non-executive Chairman
29 March 2012
Consolidated statement of comprehensive income
For the six months ended 31 January 2012
Six months ended 31 January 2012 Unaudited £'000 | Six months ended 31 January 2011 Unaudited £'000 | Year ended 31 July 2011 Audited £'000 | |
Revenue | 3,193 | 2,653 | 5,327 |
Cost of sales | (1,658) | (1,469) | (2,678) |
Gross profit | 1,535 | 1,184 | 2,649 |
Administrative costs | (1,173) | (883) | (1,966) |
Operating profit | 362 | 301 | 683 |
Finance income | 3 | 3 | 5 |
Finance costs | (7) | (10) | (18) |
Profit before tax | 358 | 294 | 670 |
Income tax (expense) | (66) | (78) | (95) |
Profit for the period attributable to owners of the parent | 292 | 216 | 575 |
Other comprehensive income | |||
Currency translation differences on translation of foreign operations | 32 | (32) | (44) |
Total comprehensive income for the year attributable to owners of the parent | 324 | 184 | 531 |
Earnings per share | |||
Basic earnings per share | 1.00p | 0.74p | 1.97p |
Diluted earnings per share | 0.93p | 0.73p | 1.84p |
Consolidated statement of financial position
As at 31 January 2012
31 January 2012 Unaudited £'000 | 31 January 2011 Unaudited £'000 | 31 July 2011 Audited £'000 | |
Assets | |||
Non-current assets | |||
Property, plant and equipment | 2,641 | 2,681 | 2,656 |
Intangible assets | 807 | 917 | 837 |
Deferred tax assets | 82 | 67 | 100 |
3,530 | 3,665 | 3,593 | |
Current assets | |||
Inventories | 344 | 471 | 473 |
Trade and other receivables | 1,445 | 1,838 | 1,600 |
Other current assets | 18 | 19 | 32 |
Cash and cash equivalents | 1,871 | 1,026 | 1,345 |
3,678 | 3,354 | 3,450 | |
Total assets | 7,208 | 7,019 | 7,043 |
Liabilities | |||
Current liabilities | |||
Borrowings | 286 | 286 | 286 |
Trade and other payables | 1,579 | 1,736 | 1,557 |
Current tax liabilities | 79 | 80 | 53 |
1,944 | 2,102 | 1,896 | |
Non-current liabilities | |||
Borrowings | 262 | 547 | 405 |
Trade and other payables | 32 | 73 | 59 |
Deferred tax liabilities | 43 | 6 | 35 |
337 | 626 | 499 | |
Total liabilities | 2,281 | 2,728 | 2,395 |
Net assets | 4,927 | 4,291 | 4,648 |
Equity | |||
Equity attributable to owners of the parent | |||
Share capital | 73 | 73 | 73 |
Share premium account | 2,841 | 2,841 | 2,841 |
Share option reserve | 190 | 167 | 177 |
Currency translation reserve | 24 | 4 | (8) |
Retained earnings | 1,799 | 1,206 | 1,565 |
Total equity | 4,927 | 4,291 | 4,648 |
Consolidated statement of cash flows
For the six months ended 31 January 2012
Six months ended 31 January 2012 Unaudited £'000 | Six months ended 31 January 2011 Unaudited £'000 | Year ended 31 July 2011 Audited £'000 | |
Cash flows from operating activities | |||
Profit before tax | 358 | 294 | 670 |
Share-based payment charges | 13 | 9 | 20 |
Depreciation and amortisation charges | 101 | 105 | 207 |
Finance income | (3) | (3) | (5) |
Finance costs | 7 | 10 | 18 |
Exchange adjustments | (6) | 12 | 12 |
Decrease in inventories | 129 | 39 | 37 |
Decease/(increase) in trade and other receivables | 155 | (688) | (450) |
Increase/(decrease) in trade and other payables | (9) | 526 | 340 |
Cash generated from operations | 745 | 304 | 849 |
Income taxes refunded | - | 69 | 7 |
Net cash generated from operating activities | 745 | 373 | 856 |
Cash flows from investing activities | |||
Purchase of property, plant and equipment | (18) | (33) | (46) |
Interest received | 3 | 3 | 5 |
Net cash used in investing activities | (15) | (30) | (41) |
Cash flows from financing activities | |||
Repayment of long-term borrowings | (143) | (143) | (286) |
Dividends paid | (58) | - | - |
Interest paid | (7) | (10) | (18) |
Net cash used in financing activities | (208) | (153) | (304) |
Net increase in cash and cash equivalents | 522 | 190 | 511 |
Cash and cash equivalents at beginning of period | 1,345 | 847 | 847 |
Exchange adjustments to cash and cash equivalents at beginning of period | 4 | (11) | (13) |
Cash and cash equivalents at end of period | 1,871 | 1,026 | 1,345 |
Consolidated statement of changes in equity
For the six months ended 31 January 2012
Unaudited | ||||||
Share capital £'000 | Share premium account £'000 | Share option reserve £'000 | Currency translation reserve £'000 | Retained earnings £'000 | Total equity £'000 | |
At 1 August 2011 | 73 | 2,841 | 177 | (8) | 1,565 | 4,648 |
Share-based payment charges | - | - | 13 | - | - | 13 |
Dividends paid | - | - | - | - | (58) | (58) |
Transactions with owners | - | - | 13 | - | (58) | (45) |
Profit for the period | - | - | - | - | 292 | 292 |
Other comprehensive income |
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Currency translation differences | - | - | - | 32 | - | 32 |
Total comprehensive income for the period | - | - | 13 | 32 | 234 | 279 |
At 31 January 2012 | 73 | 2,841 | 190 | 24 | 1,799 | 4,927 |
Notes to the interim report
For the six months ended 31 January 2012
1 Nature of operations
The principal activity of GETECH Group plc ("the Company") and its subsidiary company Geophysical Exploration Technology Inc. (collectively "GETECH" or "the Group") is the provision of gravity and magnetic data, services and geological studies to the petroleum and mining industries to assist in their exploration activities.
2 General information
GETECH Group plc is the Group's ultimate Parent Company. It is incorporated in England and Wales and domiciled in England (CRN: 2891368). The address of its registered office is Convention House, St Mary's Street, Leeds LS9 7DP. Its principal place of business is Kitson House, Elmete Hall, Elmete Lane, Leeds LS8 2LJ. The Company's shares are admitted to trading on the London Stock Exchange's AIM.
The financial information for the six months ended 31 January 2012 and 31 January 2011 has not been audited and does not constitute full financial statements within the meaning of Section 434 of the Companies Act 2006. These consolidated interim financial statements ("the interim financial statements") have been approved by the Board.
The financial information relating to the year ended 31 July 2011 does not constitute full financial statements within the meaning of Section 434 of the Companies Act 2006. This information is based on the Group's statutory accounts for that period. The statutory accounts were prepared in accordance with International Financial Reporting Standards as adopted by the EU (IFRS) and received an unqualified audit report and did not contain statements under Sections 498(2) or (3) of the Companies Act 2006. Those financial statements have been filed with the Registrar of Companies.
3 Basis of preparation
The interim financial statements are for the six months ended 31 January 2012. They have been prepared using the recognition and measurement principles of IFRS. IFRS include interpretations issued by the International Financial Reporting Interpretation Committee (IFRIC). The interim financial statements do not include all the information required for full annual financial statements and should be read in conjunction with the financial statements of the Group for the year ended 31 July 2011.
The interim financial statements have been prepared under the historical cost convention except in relation to financial instruments held at face value through profit or loss. They have been prepared in accordance with the accounting policies adopted in the last annual financial statements for the year ended 31 July 2011.
The accounting policies have been applied consistently throughout the Group for the purpose of preparation of the interim financial statements.
4 Dividends
Six months ended 31 January 2012 Unaudited £'000 | Six months ended 31 January 2011 Unaudited £'000 | Year ended 31 July 2011 Audited £'000 | |
Paid during the period | |||
Final (2011: 0.2p per share) | 58 | - | - |
Proposed after the period end (not recognised as a liability) | |||
Final (2011: 0.2p per share) | - | - | 58 |
Interim (2012: 0.2p per share) | 58 | - | - |
The proposed dividend is payable on 8 May 2012 to members on the register at 10 April 2012.
5 Earnings per share
Basic earnings per share is calculated on the basis of the profit for the period after tax, divided by the weighted average number of Ordinary Shares in issue in the period of 29,237,151 (six months ended 31 January 2011: 29,237,151; year ended 31 July 2011: 29,237,151).
Diluted earnings per share is calculated on the basis of the profit for the year after tax, divided by the weighted average number of Ordinary Shares in issue plus the weighted average number of Ordinary Shares which would be issued if all options granted were exercised. The addition to the weighted average number of Ordinary Shares used in the calculation of diluted earnings per share for the six months ended 31 January 2012 is 2,088,414 (six months ended 31 January 2011: 399,725; year ended 31 July 2011: 2,088,414). A minority of options in issue at 31 January 2012 were anti-dilutive (31 January 2011: minority; 31 July 2011: minority).
6 Interim Report
This Interim Report is being sent to the shareholders of GETECH and will be available at its registered office, Convention House, St Mary's Street, Leeds LS9 7DP, UK, and from its website www.getech.com.