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PIPEHAWK PLC - Half-yearly ReportPIPEHAWK PLC - Half-yearly Report
PR Newswire
London, March 5
Chairman's Statement
I am pleased to report that the Company's turnover in the six months ended 31December 2012 was £1,984,000, an increase on turnover for the correspondingperiod last year of 24.9 per cent. (2011: £1,589,000), resulting in a profitbefore taxation of £83,000 (2011: loss of £213,000.)
In the period under review PipeHawk continued to develop new Ground ProbingRadar (GPR) products and as a consequence has, in the six months ended 31December 2012, capitalised approximately £103,000 of research and developmentexpenditure. We have continued at pace with the development of the e-Safe.During the period PipeHawk secured a grant from the Technology Strategy Boardto support the continuance of the development of the e-Safe product. Marketingactivity has identified a number of low cost GPR based products that the e-Safeplatform will support. The first phase of the e-Safe product launch is set totake place in the second half of this financial year. In addition, PipeHawk haslaunched a project to develop the core GPR software to be platform independent.This will enable PipeHawk's market leading software to be readily portableacross product platforms, gain competitive advantage through re-use and providethe ability to readily integrate other third party survey tools.
During the period QM Systems ("QM") has significantly increased its business inthe fields of automation, test and assembly. QM has entered a new and excitingphase in its development following significant contract wins during the firsthalf of the financial year. Revenue at QM has increased by 29 per cent.compared to the same period last year and in the first half QM achieved aprofit of £125,000. QM provides its clients with a true turnkey solution forcomplete production systems consisting of assembly, test and build managementsolutions. All projects are designed and manufactured in house at QM'sWorcester and Aldershot facilities. QM is entering a phase of rapid growth andin order to deliver the projects currently on the order book and underdiscussion, QM have recruited 12 new engineers across the business. Inaddition, further resource has been recruited to expand the sales team andpurchasing functions. QM's business continues to go from strength to strengthwith major contracts secured with new and existing clients. Furthermore, QM hasdemonstrated that it is now geared to handle large scale infrastructureprojects and has secured key complete production system projects with majorblue chip companies like Kingspan and Caterpillar.
During the six month period under review Adien has remained profitable andcontinues to concentrate on working with major infrastructure providers. Theconstruction and contracting sectors remain difficult but Adien's order takeduring the period was the strongest it has been for 5 years and is 16% up onthe comparable period last year. Adien remains confident that it will enjoygood trading in the second half of this financial year.
SUMO, in which the Group holds a 29.6% stake, has successfully integrated the2010 acquisition of Stratascan into the Group. Stratascan enjoyed a good dealof positive PR from carrying out the survey of the Leicester car park whereRichard III's body was found. During the six months SUMO also acquired thebusiness of GSB Prospection Limited, another geophysical survey company similarto Stratascan and well known for its involvement in Channel 4's Time Teamprogramme.
Related party transactions
During the six months ended 31 December 2012, my fellow directors and I havedeferred a certain proportion of our salaries, fees and interest until theCompany is in a suitably strong position to make the full payments. Thesedeferred amounts total approximately £127,000 in the period and approximately £749,000 in total, all of which have been accrued in the Company's accounts.
Gordon WattChairman Enquiries: PipeHawk Plc Tel. No. 01252 338 959Gordon Watt (Chairman) MerchantSecurities Limited Tel. No. 020 7628 2200(Nomad and Broker)David Worlidge/Simon Clements Statement of Comprehensive IncomeFor the six months ended 31 December 2012 6 months ended 6 months ended Year ended 31 December 31 December 30 June 2012 2011 2012 (unaudited) (unaudited) (audited) £'000 £'000 £'000 Revenue 1,984 1,589 3,342 Staff costs (950) (910) (1779) General administrative expenses (865) (775) (1,458) Operating profit / (loss) 169 (96) 105 Share of operating profit / (loss) - (30) (17)in joint venture Profit/(Loss)on ordinary activities 169 (126) 88before interest and taxation Finance costs (86) (87) (158) Profit/(Loss) before taxation 83 (213) (70) Taxation 34 42 98 Profit/(Loss)for the period 117 (171) 28attributable to equity holders ofthe Company Other comprehensive income - - - Total comprehensive income / (Loss) 117 (171) 28for the period net of tax Profit/(Loss)per share (pence) - 0.36 (0.51) 0.09basic Profit/(Loss) per share (pence) - 0.24 (0.51) 0.06diluted Consolidated Statement of Financial PositionAs at 31 December 2012 Assets As at As at As at 31 December 31 December 30 June 2012 2011 2012 (unaudited) (unaudited) (audited) £'000 £'000 £'000 Non-current assets Property, plant and equipment 228 193 196 Goodwill 1,061 1,061 1,061 Intangible assets 2,451 2,237 2,348 Investment in joint venture 93 80 93 3,833 3,571 3,698 Current assets Inventories 30 94 149 Current tax assets 16 35 104 Trade and other receivables 1,278 1,284 835 Cash 741 124 189 2,065 1,537 1,277 Total Assets 5,898 5,108 4,975 Equity and liabilities Equity Share capital 330 330 330 Share premium 5,151 5,151 5,151 Other reserves (5,408) (5,724) (5,525) 73 (243) (44) Non-current liabilities Borrowings 2,673 2,747 2,719 Trade and other payable 1,520 1,298 1,309 4,193 4,045 4,123 Current liabilities Trade and other payables 1,596 1,293 779 Bank overdrafts and loans 36 13 117 1,632 1,306 896 Total equity and liabilities 5,898 5,108 4,975 Consolidated Statement of Cash FlowFor the six months ended 31 December 2012 6 months ended 6 months ended Year ended 31 December 31 December 30 June 2012 2011 2012 (unaudited) (unaudited) (audited) £'000 £'000 £'000 Cash inflow from operatingactivities Profit /(Loss) from operations 169 (96) 105 Adjustments for: Impairment of intangible assets - - 5 Depreciation 47 34 73 216 (62) 183 Decrease in inventories 119 103 48 (Increase)/Decrease in receivables (425) (304) 131 Increase in liabilities 943 391 26 Cash generated in operations 853 128 388 Interest paid (86) (87) (6) Corporation tax received 104 77 78 Net cashgenerated fromoperating 871 118 460activities Cash flows from investingactivities Development costs paid (103) (114) (230) Purchase of plant and equipment (80) (86) (128) Sale of plant and equipment 1 - - Net cash used in investing (182) (82) (358)activities Cash flows from financingactivities New loans and finance leases 48 91 118 Repayment of bank and other loans (171) - (125) Repayment of finance leases (14) (10) (18) Net cash generated from financing (137) 81 (25)activities Increase /(Decrease) in cash and 552 (1) 77cash equivalents Cash and cash equivalents at 189 112 112beginning of period Cash and cash equivalents at end 741 111 189of period Consolidated Statement of changes in equityFor the six months ended 31 December 2012 Share Share Retained Total capital premium earnings account £'000 £'000 £'000 £'000 6 months ended 31 December 2011 As at 1 July 2011 330 5,151 (5,553) (72) Loss for the period - - (171) (171) As at 31 December 2011 330 5,151 (5,724) (243) 12 months ended 30 June 2012 As at 1 July 2011 330 5,151 (5,553) (72) Profit for the period - - 28 28 As at 30 June 2012 330 5,151 (5,525) (44) 6 months ended 31 December 2012 As at 1 July 2012 330 5,151 (5,553) (44) Profit for the period - - 117 117 As at 31 December 2012 330 5,151 (5,408) 73 Notes to the Interim Results 1. Basis of preparationThe Interim Results for the six months ended 31 December 2012 are unaudited anddo not constitute statutory accounts in accordance with section 240 of theCompanies Act 2006.
Full accounts for the year ended 30 June 2012, on which the auditors gave anunqualified report and contained no statement under Section 237 (2) or (3) ofthe Companies Act 2006, have been delivered to the Registrar of Companies.
The interim financial information has been prepared on a basis which isconsistent with the accounting policies adopted by the Group for the lastfinancial statements and in compliance with basic principles of IFRS.
Gordon Watt has confirmed that he will not recall loans payable to him, withinthe next 12 months. Therefore non-current liabilities at 31 December 2011 and30 June 2012 have been restated to include amounts owing to Gordon Watt whichwere previously shown in current liabilities.
2. Segmental information
The Group operates in one geographical location being the UK. Accordingly theprimary segmental disclosure is based on activity.
Utility Development, Test Total detection assembly and system and mapping sale of GPR solutions services equipment £'000 £'000 £'000 £'000 6 months ended 31 December 2012 Total segmental revenue 906 72 1,006 1,984 Segmental result 128 (76) 117 169 Finance costs (4) (82) - (86) Share of operating profit in -joint venture Profit before taxation 83 Segment assets 1,052 2,877 1,969 5,898 Segment liabilities 896 3,155 1,774 5,825 Depreciation and amortisation 33 14 - 47 Additions to non-current assets 57 - 23 80 6 months ended 31 December 2011 Total segmental revenue 674 122 793 1,589 Segmental result (49) (32) (15) (96) Finance costs (10) (77) (15) (87) Share of operating loss in joint (30)venture Loss before taxation (213) Segment assets 779 2,913 1,416 5,108 Segment liabilities 876 3,048 1,427 5,351 Depreciation and amortisation 24 - 10 34 Additions to non-current assets 19 - 69 88 12 months ended 30 June 2012 Total segmental revenue 1,524 221 1,597 3,342 Segmental result 76 (7) 36 105 Finance costs (6) (152) - (158) Share of operating loss in joint (17)venture Loss before taxation (70) Segment assets 1,020 2,837 1,118 4,975 Segment liabilities 987 2,428 1,048 4,463 Depreciation and amortisation 49 2 33 84 Additions to non-current assets 59 - 69 1283. Profit/(Loss)per share
This has been calculated on the profit for the period of £117,000 (2011: loss £171,000) and the number of shares used was 33,020,515 (2011: 33,020,515), beingthe weighted average number of share in issue during the period.
4. Dividends
No dividend is proposed for the six months ended 31 December 2012.
5. Copies of Interim Results
The Interim Results will be posted on the Company's web site www.pipehawk.comand copies are available from the Company's registered office at 4, Manor ParkIndustrial Estate, Wyndham Street, Aldershot GU12 4NZ.