28 Mar 2013 07:01
JSJS DESIGNS PLC
("JSJS" or "the Company")
(AIM: JSJS)
Preliminary Results for the Year Ended 30th September 2012
The Board of JSJS the provider of innovative home automation technologies, announces today Final Results for the year ended 30th September 2012.
Contacts: | |
JSJS Designs Plc | www.jsjsdesigns.com |
Mike Lord, CEO | +44 (0) 1902 500 562 |
WH Ireland Limited | www.wh-ireland.co.uk |
Mike Coe (Corporate Finance) | +44 (0) 117 945 3470 |
Jasper Berry (Institutional Sales) | +44 (0) 20 7220 0473 |
The Company confirms that the Annual Report and Accounts for the year ended 30 September 2012 will be sent to shareholders today and will be available on the Company's website: www.jsjsdesigns.com
CHAIRMAN & CHIEF EXECUTIVE OFFICER REPORT
Financials
The Group's financials for the period reflect sales from its new innovative product range only and consequently show a much improved margin at 48.5% (2011: old discounted product range 4.4%). The increase in overheads reflects both ongoing significant product and App development costs but also increase in cost due to market entry. Measures have been taken to reduce the ongoing level of overhead expenditure by replacing fixed costs with sales dependent variable costs. These measures along with the new innovative product range sets a strong platform for the Group moving into 2013.
Turnover for the period was £1,109,305 (2011: £2,219,891) and gross profit margin was 48.5% (2011: 4.4%). Loss before tax was £761,443 (2011: £869,196). Cash in bank amounted to £ 28,194 at 30 September 2012 (2011: £14,409). Total assets at the year end were £ 800,703 (2011: £860,090).
The Group raised additional funds of 0.5 million (gross) reflecting the second tranche of funding following a conditional placing on 17 October 2011 at a placing price of 1p per Ordinary Share. The conditional placing consisted of 50,000,000 ordinary shares.
Operating & Product Review
The JSJS product portfolio now extends to over 75 devices operating through the LightwaveRF protocol. The Company's leading edge Radio Frequency product range, through LightwaveRF, now addresses the core issue facing UK households and businesses - cost and energy saving. Through our product range consumers can remotely operate and control lighting, heating, air conditioning and security through their smartphones and the Cloud in order to ensure settings are at an optimum, limiting time, energy output and day to day costs.
The JSJS LightwaveRF system is now established in the market. Success so far has been in the lighting and electrical sector as well as Eco monitoring. These products have been enhanced further already during the current financial year with the additions of in line relays and wireless dimmer switches.
Significant resource has been dedicated to further enhancement to the LightwaveRF cloud services through a new range of Smartphone Apps as well as the development of our much anticipated heating products. These products will launch during the last half of the current financial year followed by a more comprehensive range of security products. Whilst development of these new products has been a little slower than anticipated the Company believes they will transform the market expeditions in Home Automation.
Distribution
Considerable progress has been made in acquiring major new distribution partnerships during the year. The beginning of the year saw the launch into B&Q in partnership with Siemens followed subsequently by their Kingfisher partner Screwfix.
In addition Maplin began web selling and the product was well received in the electrical wholesale market. Other products have created other offerings under the LightwaveRF brand with building success alongside other specialist resellers. The strategy has evolved into focusing on our channel partners to help develop the wide variety of distribution opportunities for the product range and key retail relationships from the centre. This has proved very successful in recent months.
Operations
Our strategy has been to lower central fixed overheads by investing in IT and outsourcing logistics. This will not only achieve significant overhead cost savings during 2012/13 but will allow the business to scale more quickly as additional distribution and products are added. The strategy is expected to deliver greater flexibility as the business grown whilst allowing the management team to focus on our core skills of technology and distribution development.
Outlook
Most of the significant investment into innovative product ranges and capabilities is complete and our partnership approach in creating distribution partnerships continues at a pace facilitated by our flexible variable cost based operations. The directors of the Group are confident that the investment will begin to reap rewards towards the end of the financial year 2013 and more significantly during the financial year 2014.
This is further supported by the recently announced fund raising which is expected to raise £535,000, subject to the forthcoming GM and, inter alia, the agreement of a debt repayment schedule with a major supplier. Our partner supplier has been key in both developing the product line and providing considerable support to ensure the mutual success of the Group particularly over the last 12 months. The relationship remains strong and key to future development
2012 has been a period of progression at JSJS; one which has seen the development of the Group in terms of product portfolio, partner distribution agreements, a successful capital raising and move into the market phase.
Significant effort has been made to build a complementary network of distribution channels, both directly and with partners in contact with consumers, electrical wholesalers and contractors to house builders, e-tailers, heating and kitchen trade distributors in the UK, and also to establish international opportunities. The Group hopes to add consistent underlying sales as well as further major blue chip contract wins during 2013.
I would like to take this opportunity to thank not only shareholders who supported the capital raising for their continued support and belief in the Company's leading-edge technology, but also the management team who have worked tremendously hard during a period of evolution.
Mike Lord
Chairman & CEO
27 March 2013
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
YEAR ENDED 30 SEPTEMBER 2012
CONTINUING OPERATIONS | Notes | Year ended | Year ended |
30-Sep-12 | 30-Sep-11 | ||
£ | £ | ||
REVENUE | 1,109,305 | 2,219,891 | |
Cost of Sales | (571,330) | (2,121,656) | |
GROSS PROFIT | 537,975 | 98,235 | |
Administrative expenses | (1,297,733) | (959,501) | |
LOSS ON OPERATIONS | (759,758) | (861,266) | |
Finance expense | (28,170) | (7,942) | |
Finance income | 26,485 | 12 | |
LOSS FOR THE YEAR BEFORE INCOME TAX | (761,443) | (869,196) | |
Tax charge/(credit) on loss on ordinary activities | - | - | |
LOSS FOR THE YEAR FROM CONTINUING OPERATIONS ATTRIBUTABLE TO EQUITY SHAREHOLDERS OF THE PARENT | (761,443) | (869,196) | |
Other comprehensive income | - | - | |
LOSS AND TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO EQUITY SHAREHOLDERS OF THE PARENT | (761,443) | (869,196) | |
Basic & Diluted loss per share | 2 | 0.207p | 0.341p |
GROUP STATEMENT OF FINANCIAL POSITION
AS AT 30 SEPTEMBER 2012
Year ended | Year ended | |
30-Sep-12 | 30-Sep-11 | |
£ | £ | |
ASSETS | ||
Non-current assets | ||
Property, plant & equipment | 12,567 | 3,625 |
12,567 | 3,625 | |
Current Assets | ||
Inventories | 469,263 | 276,231 |
Trade & Other Receivables | 290,049 | 565,825 |
Cash and cash equivalents | 28,194 | 14,409 |
787,506 | 856,465 | |
TOTAL ASSETS | 800,073 | 860,090 |
Equity & Liabilities | ||
Equity | ||
Issued share capital | 369,440 | 305,233 |
Unissued share capital | - | 5,000 |
Share premium account | 2,165,929 | 1,593,067 |
Reverse acquisition reserve | (100,616) | (100,616) |
Retained losses | (3,278,478) | (2,509,931 |
Total Equity | (843,725) | (707,247) |
Current liabilities | ||
Trade & other payables | 1,153,670 | 1,567,337 |
Loans and borrowings | 476,103 | - |
Total current liabilities | 1,629,773 | 1,567,337 |
Non current liabilities | ||
Loans and borrowings | 14,025 | - |
Total non current liabilities | 14,025 | - |
Total Equity & Liabilities | 800,073 | 860,090 |
COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 30 SEPTEMBER 2012
Year ended | Year ended | |
30-Sep-12 | 30-Sep-11 | |
£ | £ | |
ASSETS | ||
Non-current assets | ||
Investments | 100,620 | 100,620 |
100,620 | 100,620 | |
Current Assets | ||
Other receivables | 2,223,332 | 1,490,725 |
Cash at cash equivalents | 460 | 72 |
2,223,792 | 1,490,797 | |
TOTAL ASSETS | 2,324,412 | 1,591,417 |
Equity & Liabilities | ||
Equity | ||
Issued share capital | 369,440 | 305,233 |
Unissued share capital | - | 5,000 |
Share premium account | 2,165,929 | 1,593,067 |
Retained Losses | (730,957) | (588,976) |
Total Equity | 1,804,412 | 1,314,324 |
Current liabilities | ||
Trade & other payables | 89,448 | 277,093 |
Loans and borrowings | 430,552 | - |
Total current liabilities | 520,000 | 277,093 |
Total Equity & Liabilities | 2,324,412 | 1,591,417 |
GROUP STATEMENT OF CASHFLOWS
YEAR ENDED 30 SEPTEMBER 2012
Year ended | Year ended | |
30-Sep-12 | 30-Sep-11 | |
£ | £ | |
Cash flow from operating activities | ||
Loss before tax | (761,443) | (869,197) |
Adjusted for: | ||
Depreciation | 4,833 | 3,750 |
Loss on disposal of property, plant and equipment | - | 4,000 |
Investment income | (89) | (12) |
Exchange gains | (19,294) | - |
Interest expense | 28,170 | 7,942 |
Increase in inventories | (193,032) | (276,231) |
Decrease/(increase) in trade and other receivables | 278,148 | 351,373 |
(Decrease)/increase in trade and other payables | 497,909 | 660,787 |
Exchange rate variance | 14,492 | - |
(7,104) | - | |
Cash absorbed by operations | (171,902) | (117,588) |
Finance costs | (13,410) | (7,942) |
(149,382) | (125,530) | |
Cash flows from investing activities | ||
Purchase of property, plant & equipment | (13,775) | - |
Finance revenue | 89 | 12 |
(13,686) | 12 | |
Cash flows from financing activities | ||
Proceeds from issue of shares | 500,000 | - |
Proceeds from bank borrowing | 25,000 | - |
Repayment of bank borrowings Interest paid on borrowings Interest paid on convertible loan note Repayment of convertible loan note | (3,997) (678) (8,332) (335,411) | - - - - |
176,582 | - | |
Net increase / (decrease) in cash and cash equivalents | (22,416) | (125,518) |
Cash and cash equivalents at 1 October 2011 | 14,409 | 139,927 |
Cash and cash equivalents at 30 September 2012 | (8007) | 14,409 |
COMPANY STATEMENT OF CASHFLOWS
YEAR ENDED 30 SEPTEMBER 2012
Year ended | Year ended | |
30-Sep-12 | 30-Sep-11 | |
£ | £ | |
Cash flow from operating activities | ||
Loss before tax | (134,877) | (167,800) |
Adjusted for: | ||
Investment income | (88) | (12) |
Exchange gains Interest expense | (19,294) 14,209 | - 62 |
Decrease/(increase) in trade and other receivables | 52,649 | (190,074) |
Decrease/(increase) in trade and other payables
| (61,325)
| 219,742 |
Gains in liabilities settled in shares | (7,104) | - |
Cash absorbed by operations | (155,830) | (138,082) |
Finance costs | (127) | (62) |
(155,957) | (138,144) | |
Cash flows from investing activities | ||
Finance revenue | 88 | 12 |
88 | 12 | |
Cash flows from financing activities | ||
Proceeds from issue of shares | 500,000 | - |
Interest paid on convertible loan note | (8,332)
| - |
Repayment of convertible loan note | (335,410) | - |
156,258 | - | |
Net increase / (decrease) in cash and cash equivalents |
388 |
(138,132) |
Cash and cash equivalents at 1 October 2011 | 72 | 138,204 |
Cash and cash equivalents at 30 September 2012 | 460 | 72 |
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 SEPTEMBER 2012
GROUP | Issued | Unissued | Reverse | Retained | ||
Share | Share | Share | Acquisition | Earnings/ | Total | |
Capital | Capital | Premium | reserve | (Losses) | Equity | |
£ | £ | £ | £ | £ | £ | |
As at 1st October 2011 | 305,233 | 5,000 | 1,593,067 | (100,616) | (2,509,931) | (707,247) |
Loss for the year and total comprehensive income | - | - | - | - | (761,443) | (761,443) |
Shares Issued | 64,207 | (5,000) | 572,862 | - | (7,104) | 624,965 |
As at 30th September 2012 | 369,440 | - | 2,165,929 | (100,616) | (3,378,478) | (843,725) |
COMPANY | Issued | Unissued | Retained | ||||
Share | Share | Share | Earnings/ | Total |
| ||
Capital | Capital | Premium | (Losses) | Equity | |||
£ | £ | £ | £ | £ | |||
As at 1st October 2011 | 305,533 | 5,000 | 1,593,067 | (588,976) | 1,314,324 | ||
Loss for the year and total comprehensive income | - | - | - | (134,877) | (134,877) | ||
Shares Issued | 64,207 | (5,000) | 572,862 | (7,104) | 624,965 | ||
As at 30th September 2012 | 369,440 | - | 2,165,929 | (730,957) | 1,804,412 | ||
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 SEPTEMBER 2011
GROUP | Issued | Unissued | Reverse | Retained | ||
Share | Share | Share | Acquisition | Earnings | Total | |
Capital | Capital | Premium | reserve | Equity | ||
£ | £ | £ | £ | £ | £ | |
As at 1st October 2010 | 252,533 | 50,000 | 1,149,2670 | (100,616) | (1,640,735) | (289,551) |
Loss for the year and total comprehensive income | - | - | - | - | (869,196) | (869,196) |
Shares Issued | 52,700 | (45,000) | 443,800 | - | - | 451,500 |
As at 30th September 2011 | 305,233 | 5,000 | 1,593,067 | (100,616) | (2,509,931) | (707,247) |
COMPANY | Issued | Unissued | Retained | ||
Share | Share | Share | Earnings | Total | |
Capital | Capital | Premium | Equity | ||
£ | £ | £ | £ | £ | |
As at 1st October 2010 | 252,533 | 50,000 | 1,149,267 | (421,175) | 382,683 |
Loss for the year and total comprehensive income | - | - | - | (167,801) | (167,801) |
Shares Issued | 52,700 | (45,000) | 443,800 | - | 451,500 |
As at 30th September 2011 | 305,233 | 5,000 | 1,149,267 | (588,976) | 1,314,324 |
NOTES
1. Basis of Preparation
The principal accounting policies adopted in the preparation of the financial statements are set out below. The policies have been consistently applied to all the years presented, unless otherwise stated.
These financial statements have been prepared in accordance with International Financial Reporting Standards, International Accounting Standards and Interpretations (collectively IFRSs) issued by the International Accounting Standards Board (IASB) and its committees, as adopted by the European Union ("adopted IFRSs"). The financial statements have also been prepared in accordance with those parts of the Companies Act 2006 applicable to companies preparing financial statements in accordance with IFRS.
The preparation of financial statements in compliance with adopted IFRS requires the use of certain critical accounting estimates. It also requires Group management to exercise judgement in applying the company's accounting policies. The areas where significant judgements and estimates have been made in preparing the financial statements and their effect are disclosed in the note below.
The financial information set out above does not constitute the Company's statutory accounts for the years ended 30 September 2012, but is derived from those accounts. Statutory accounts for 2011 have been delivered to the Registrar of Companies and those for 2012 will be delivered shortly.
Going concern
Further information on future trading and liquidity risk is included in the Chairman's statement. Based on their current expectations of the intentions and support of key investors in the Company the directors have a reasonable expectation that the Group will be able to raise additional funding in the share issue planned for April 2013. Based on their current expectations of the progress of the product development the directors have a reasonable expectation that revenue will be generated in line with the forecasts during this year and will be available to underpin the cash flows of the Group. In the event that this revenue is not generated the directors consider it likely that additional funding can be raised from shareholders or a further share placing at the appropriate time.
Furthermore, based on their expectations of their ability to manage the payments of the Group and the expected receipt of funds from the share placing, the directors consider that the group will have adequate funding resources to continue in operational existence for the foreseeable future. The forecasts indicate that the group is only a going concern if required funds to be obtained from the share issue planned for April 2013 are received. The disclosures also indicate that the Group is only able to continue as a going concern for at least the twelve month period from the signing of these financial statements if the cash flow expected from product sales is generated or, in the event that such sales are not generated, that additional funding is able to be obtained from a further share issue at an appropriate time. The directors consider that these conditions indicate the existence of material uncertainties which may cast significant doubt over the group's ability to continue as a going concern.
In addition, the company has held talks with its lenders about its future borrowing needs and no matters have been drawn to their attention that suggest that renewal may not be forthcoming on acceptable terms.
Accordingly the directors continue to adopt the going concern basis in preparing the annual report and accounts.
The financial statements do not include the adjustments that would result if the company was unable to continue as a going concern.
Basis of consolidation
The financial statements have been prepared using the reverse accounting provisions of International Financial Reporting Standard 3 (as issued in 2004).
Reverse accounting has been determined to be required in accounting for the business combination of the Company and JSJS Designs (Europe) Limited because following the business combination, the Parent company is effectively controlled by the Board and the former shareholders of JSJS Designs (Europe) Limited. In effect, the transaction is accounted for as though JSJS Designs (Europe) Limited was the acquiring company rather than the acquired and JSJS Designs plc has been treated as a subsidiary. The reverse acquisition reserve consists of amounts arising from the adjustment made to the equity instruments of the legal acquiree in reverse acquisition accounting.
The financial statements consolidate the accounts of JSJS Designs Plc, JSJS Designs (Europe) Limited and its non-trading subsidiary, undertaking at 30th September 2012. Intercompany balances and transactions are eliminated in full.
2. Loss per share
The basic loss per share is calculated by dividing the loss for the financial year attributable to shareholders by the weighted average number of shares in issue. The remaining securities in issue are not dilutive as at 30 September 2012.
Year ended | Year ended | |
30-Sep-12 | 30-Sep-11 | |
Number | Number | |
Numerator | ||
Loss used for calculation of basic and diluted EPS | 761,443 | 869,196 |
Denominator | ||
Weighted average number of ordinary shares used in basic and diluted EPS | 367,286,223 | 255,104,018 |
Basic and diluted loss per share | 0.207p | 0.341p |
At 30 September 2012, there were 2,000,000 (2011: 2,000,000) of potentially issuable shares which are anti-dilutive; such shares may become dilutive in future periods.
3. Annual Report and Annual General Meeting
The Annual Report will be available from the Company's website www.jsjsdesigns.com and will be posted to shareholders on 28 March 2013. The Annual Report contains notice of the Annual General Meeting of the Company which will be held at 10 a.m. on Wednesday 24th April 2013 at Birmingham Science Park Aston, Faraday Wharf, Holt Street, Birmingham B7 4BB.