26 Jun 2007 07:00
26 June 2007
AMTEUS PLC (AUS) ANNOUNCES UNAUDITED INTERIM RESULTS TO 31 MARCH 2007
Amteus PLC (AUS) ("Amteus" or the "Company") today announces its unaudited interim results for the half year ended 31 March 2007.
Unaudited Unaudited 31 Audited 31 March March 2007 2007 30 September (6 months) 2006 (6 months) (12 months) Restated Restated ‚£ ‚£ ‚£ Turnover 47,959 15,559 37,417 Cost of sales (6,656) (1,426) (9,575) Gross profit 41,303 14,133 27,842 Operating expenses (1,623,180) (950,639) (2,659,884) Operating loss (1,581,877) (936,506) (2,632,042) Finance (charges)/income (13,278) (518) 7,259
Loss on ordinary activities before (1,595,155) (937,024) (2,624,783) taxation
Tax on loss on ordinary activities - - - Loss for the financial period (1,595,155) (937,024) (2,624,783) Loss per share - basic and diluted (4.6p) (3.1p) (8.2p) Highlights * Customer base growing, both resellers and end users * 160 trials agreed * Significant interest from education sector - 72 trials are for schools
Chairman, Michael Abrahams said, "Interest and awareness of the Amteus secure IM product is now beginning to grow at a faster rate than in the early part of this year. Feedback from the market indicates that the trials currently underway are expected to result in a successful order flow. The new business model is raising awareness of the product and subsequently providing increased visibility for our potential customer base. As the number of satisfied customers grows, the market for secure IM will become established and the directors believe that growth will accelerate."
For enquiries:
Amteus plc
Michael Abrahams (Chairman)
Tel: (01756) 770376Rawlings FinancialJohn RawlingsTel: (01756) 770376
John East & Partners Limited
Simon Clements/John EastTel: (0207) 628 2200Chairman's Statement
It gives me pleasure to report the interim results for the six months to 31 March 2007 and to give the Company's shareholders an update on the progress Amteus has made following the placing to raise ‚£3.5 million (before expenses) which was announced on 6 March 2007. The fundraising has provided the Company with the necessary working capital to bring the Instant Messaging product to market and take advantage of our rapidly growing sales opportunities.
Results
Revenue in the six months to 31 March 2007 amounted to ‚£47,959 (2006: ‚£15,559) and the loss before and after tax was ‚£1,595,155 (2006: ‚£937,024). At the period end, cash balances were ‚£2,534,795. Under the Company's revenue recognition policy there was ‚£171,817 of deferred revenue held at the balance sheet date.
Sales
Amteus now has 97 installed customers; 55 of which are accredited resellers and 42 are end users. We are now beginning to achieve traction in the market with 160 potential new customers either trialling the IM product or about to trial the product. The number of trialists is growing steadily on a daily basis. We achieved during the week ended 22 June 2007 a daily run rate of 17 new trial bookings.
In particular, we have experienced significant interest from the Education Sector where the use of public instant messaging is almost universally barred and a secure community, which is part of the solution provided by Amteus, is of great attraction. 72 of our trialists are schools. We are already receiving very positive feedback from these trialists and have received our first order, from a school in North Yorkshire, ahead of time.
Our direct sales team is beginning to achieve significant success with end users and have signed up United Co-Op Travel Group along with some other major national companies. We also have 88 business trialists.
Amteus is working with existing resellers to promote the product to their customers and we have recruited a new relationship manager to head up this process. We are also working closely with several major national resellers, and are confident that the reseller distribution will, over the next few months, gain momentum.
Although the business community has been slower to embrace secure IM as a business communications tool than first anticipated, awareness and interest is now increasing. Despite market forecasts the take up of business IM has been lower than predicted. IM, has hitherto been perceived as a personal communication medium for the younger generation. However the realisation is growing that secure IM is ideally suited to all businesses which need to communicate quickly, frequently and confidentially with customers, suppliers or staff. The Amteus system, which prospective customers can now see at work through our trial initiative, highlights the advantages which are already being experienced by our installed customer base. We believe the increasing trialist base will see the benefits of the product and sign up as customers.
Product development
Considerable technical progress has been made in the core Amteus product including:
* Cross Domain - the ability to allow users in different Amteus communities to communicate with each other. * User Management - enhanced control of access rights and permissions and integration with Active Directory. The system can accommodate different security levels within the Amteus community. * Major Graphic User Interface improvements
In addition, Amteus has developed additional modular functionality. Amteus is now able to offer:
* Web IM - access to the Amteus system through a secure web interface. This has been extended to multiple platforms including Apple and Linux. * Compliance - the ability to record and store all IM conversations to a central secure location which preserves the data for audit and compliance requirements in an easily accessible form. * Management Reporting - the ability to monitor and report user activity.
Business model
The business model, to be applied to trialists opting to sign up as customers is strongly incentivised towards a three year service and maintenance agreement with modular functionality offerings such as WebIM, Compliance and Management Reporting being subject to additional charges.
People
The Group now employs 54 people, the majority of whom, are in technical development, sales and marketing and customer support.
As previously announced, on 24 May 2007, David Hoyle, Finance Director, and Aynur Unal, Business Development Director working in the USA, left the company. Christopher Williamson ACA, who has been Financial Controller at the Company since August 2006, is currently fulfilling the function of Finance Director, pending the appointment of a full time replacement.
Outlook
Interest and awareness of the Amteus secure IM product is now beginning to grow at a faster rate than in the early part of this year. Feedback from the market indicates that the trials currently underway are expected to result in a successful order flow. The new business model is raising awareness of the product and subsequently providing increased visibility for our potential customer base. As the number of satisfied customers grows, the market for secure IM will become established and the directors believe that growth will accelerate.
Michael Abrahams CBE DLChairman26 June 2007
Consolidated Profit and Loss Account
For the six months ended 31 March 2007
Note Unaudited Unaudited Audited 31 March 31 March 2007 2007 30 September 2006 (6 months) (6 months) (12 months) Restated Restated ‚£ ‚£ ‚£ Turnover 4 47,959 15,559 37,417 Cost of sales (6,656) (1,426) (9,575) Gross profit 41,303 14,133 27,842 Operating expenses (1,623,180) (950,639) (2,659,884) Operating loss (1,581,877) (936,506) (2,632,042) Finance (charges)/income (13,278) (518) 7,259
Loss on ordinary activities before (1,595,155) (937,024) (2,624,783) taxation
Tax on loss on ordinary activities 5 - - - Loss for the financial period (1,595,155) (937,024) (2,624,783) Loss per share - basic and diluted 6 (4.6p) (3.1p) (8.2p)
All the results for the period relate to continuing activities.
STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
Note Unaudited Unaudited Audited 31 March 31 March 30 September 2007 2006 2006 (6 months) (6 months) (12 months) Restated Restated ‚£ ‚£ ‚£ Loss for the financial period (1,595,155) (937,024) (2,624,783) Prior period adjustment in respect 2 (165,496) of change in accounting policy Total recognised losses relating to (1,760,651) the period Consolidated Balance SheetAs at 31 March 2007 Note Unaudited Unaudited Audited 31 March 31 March 30 September 2007 2006 2006 Restated Restated ‚£ ‚£ ‚£ Fixed assets Tangible assets 184,001 207,086 178,715 Current assets Stock 105,581 9,680 85,125 Debtors 183,239 187,026 59,774 Cash at bank and in hand 2,534,795 2,253,757 919,958 2,823,615 2,450,463 1,064,857
Creditors - amounts falling due within (1,740,531) (842,865) (1,194,897) one year
Net current assets/(liabilities) 1,083,084 1,607,598 (130,040)
Total assets less current liabilities 1,267,085 1,814,684 48,675
Creditors - amounts falling due after (25,541) (792,229) (593,086)more than one year Net assets/(liabilities) 1,241,544 1,022,455 (544,411) Capital and reserves Called up share capital 3 3,948,709 3,446,639 3,447,458 Share premium 5,347,789 2,579,460 2,579,460 Share options reserve 277,026 53,859 165,496 Profit and loss account (8,331,980) (5,057,503) (6,736,825)
Equity Shareholders' funds/(deficit) 1,241,544 1,022,455 (544,411)
Consolidated Cash Flow Statement
For the six months ended 31 March 2007
Note Unaudited Unaudited Audited 31 March 31 March 30 2007 2006 September 2006 (6 months) (6 months) (12 months) ‚£ ‚£ ‚£
Net cash outflow from operating 7 (1,430,399) (1,012,287) (2,258,607) activities
Return on investments and servicing 12,064 (3,552) 31,743of finance Capital expenditure (net) (19,295) (6,717) (26,226) Management of liquid resources (2,400,000) (2,200,000) (750,000) Cash outflow before financing (3,837,630) (3,222,556) (3,003,090) Financing 3,052,467 3,341,854 3,238,589 (Decrease)/increase in cash in the (785,163) 119,298 235,499period
Reconciliation of net cashflow to movement in net funds
For the six months ended 31 March 2007
Unaudited Unaudited Audited 31 March 31 March 30 September 2007 2006 2006 (6 (6 months) (12 months) months) ‚£ ‚£ ‚£ (Decrease)/increase in cash in the (785,163) 119,298 235,499period Purchase of deposits 2,400,000 2,200,000 750,000 Cash inflow from debt and lease 88,449 69,834 159,630financing Change in net funds resulting from 1,703,286 2,389,132 1,145,129cash flows New finance leases in the period (31,088) (26,136) (26,136) Conversion of debt to share capital 108,000 - -
Movement in net funds in the period 1,780,198 2,362,996 1,118,993
Opening net funds/(debt) 6,067 (175,655) (1,112,926) Closing net funds 1,786,265 2,187,341 6,067
Reconciliation of Equity Shareholders' funds/(deficit)
For the six months ended 31 March 2007
Note Unaudited Unaudited Audited 31 March 31 March 30 2007 2006 September 2006 (6 months) (6 months) (12 months) ‚£ ‚£ ‚£ New shares issued (net of issue 3 3,269,450 3,397,399 3,398,218costs) Employee share based payment 111,530 53,859 173,933 Loss for the financial period (1,595,025) (937,024) (2,624,783)
Opening equity shareholders' deficit (544,411) (1,491,779) (1,491,779)
Closing equity shareholders' funds/ 1,241,544 1,022,455 (544,411)(deficit)
NOTES TO THE INTERIM REPORT
For the six months ended 31 March 2007
1. BASIS OF PREPARATION
The interim results for the six months ended 31 March 2007, which are unaudited, have been prepared in accordance with the accounting policies adopted by Amteus Plc for the period ended 30 September 2006 with the exception of the adoption of FRS 20 Share Based Payment as disclosed below.
The financial information for the period ended 30 September 2006 is an abridged version of Amteus Plc's published statutory financial statements which received an unqualified auditors' report, contained no statement under section 237(2) or (3) of the Companies Act 1985 and which have been filed with the Registrar of Companies.
2. CHANGE IN ACCOUNTING POLICY
During the six months ended 31 March 2007 the Company adopted the provisions of FRS 20 Share Based Payment. This resulted in a charge to the profit and loss account of ‚£111,530 in respect of employee share options in issue during the period. The provisions of FRS 20 have also been applied retrospectively to the comparative periods and have resulted in a restatement of results for these periods. The charges included in the comparative periods are ‚£53,859 and ‚£ 165,496 for the six months to 31 March 2006 and the year to 30 September 2006 respectively.
3. CORPORATE RESTRUCTURING
During the period, the Company completed a secondary placing of shares on the AIM market of the London Stock Exchange. On 14 March 2007 the Company placed 4,862,500 new ordinary shares at 72p per share. The placing raised ‚£3.16m net of issue expenses.
As part of the placing, JC Morris capitalised ‚£108,000 of loans outstanding to him by the placing of a further 150,000 ordinary shares.
4. SEGMENT INFORMATION
Analysis between activities is not presented as the Company's operations comprise a single class of business, which is the provision of secure and private communications over the internet for business. The Company's operations are located in Great Britain.
5. TAX ON LOSS ON ORDINARY ACTIVITIES
There is no tax charge for the period.
6. LOSS PER SHARE
Loss per share is calculated by dividing the loss after taxation by the weighted average number of ordinary shares in issue of 34,970,320 (31 March 2006: 29,871,627 shares and 30 September 2006: 32,177,254 shares).
7. RECONCILIATION OF OPERATING LOSS TO NET CASH OUTFLOW FROM OPERATING
ACTIVITIES Unaudited Unaudited Audited 31 March 31 March 30 September 2007 2006 2006 (12 months) Restated ‚£ ‚£ ‚£ Operating loss (1,581,877) (936,506) (2,632,042) Depreciation charge 44,236 38,986 83,613 Loss on sale of tangible fixed assets 860 1,608 4,861 Employee share based payment 111,530 53,859 173,933 Increase in stocks (20,456) (6,920) (82,365) Increase in debtors (128,575) (139,503) (39,655) Increase/(decrease) in creditors 143,883 (23,811) 233,048 Net cash outflow from operating (1,430,399) (1,012,287) (2,258,607)activities 8. DIVIDENDS
No dividends are proposed for the six months ended 31 March 2007.
9. DISTRIBUTION OF INTERIM REPORT TO SHAREHOLDERS
The interim report will be available for inspection by the public at the registered office of the company during normal business hours on any weekday. Further copies are available on request.
AMTEUS PLC