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13 May 2013 07:00
13 May 2013
Coms plc
("Coms" or the "Company")
Trading Update
Coms plc. (AIM: COMS) is pleased to provide a trading update prior to the publication of its results for the year ended 31 January 2013.
Financial performance
The results for the year ended 31 January 2013 are currently being finalised and whilst these have not yet been audited, the Coms board anticipates announcing results approximately as follows:
Year ended 31 January 2013 | Group (Including VCOMM) | Group (Excluding VCOMM) |
Annual Turnover | £3,500,000 | £1,600,000 |
Gross Profit | £1,200,000 | £930,000 |
EBITDA | £1,150,000 (LOSS) | £850,000 (LOSS) |
The results will include the results of VCOMM (UK) Limited, the Company's wholly owned subsidiary focused on the distribution of telecoms equipment that, as announced on 21 December 2012, it sold for a total consideration (subject to adjustment) of £250,000 in cash. The Company has shown separately the results of its continuing operations to provide a meaningful comparison with future results.
The financial performance for the first 3 months of the current financial year have shown both an improvement in revenue and gross profit as well as a significant reduction in operating losses, reflecting the changes to the management team and the operational cost reductions introduced by Dave Breith since he became CEO of the Company on 9 January 2013.
Three months ended 30 April 2013 | |
Turnover | £570,000 |
Gross Profit | £331,000 |
EBITDA | £59,000 (LOSS) |
Business growth
Since the start of the year under Dave Breith's leadership the newly re-structured Company has announced several contract wins including agreements to supply Vonage and Worldstone and the substantial business announced on 26 April 2013.
In addition, the Coms sales team has been building up a pipeline of potential new business.
·; The Company's new in-direct sales (wholesale) division has built a pipeline of sales prospects, which represents a potential of just over £7m annualised revenue. We will be looking to convert as many of these leads as we can over the coming months.
·; The retail division has won 3 new contracts with two NHS Trusts based in the North and a Police Constabulary based in the South East. Its sales pipeline is currently showing a potential gross margin of over £100,000 per month.
·; The Company has commenced its Government sales activity initiative and anticipates that this will generate additional sales for the remainder of this financial year and beyond.
Operational Growth
·; In order to ensure that the Company delivers a "best in class" service and can manage effectively its anticipated growth, it is expected to recruit up to 20 new members of staff over the next three months.
·; In addition, the Company is reviewing the possibility of establishing a 20 person call centre to further enhance its offering and support its growth.
Corporate Strength
·; Since the start of the year, the Company has announced the acquisition of both World Telecom and So Purple Tech Limited and also the licensing of the Ask Merlin software, all of which has significantly broadened the Company's technology platform and customer base. These acquisitions are so recent that their numbers are not included in the first quarter's trading. A number of other potential enhancing acquisitions have been identified and the Board will continue to assess and investigate these opportunities with a view to further augmenting the overall business as appropriate.
·; The Board in liaison with the company's professional advisers is continuing to review the best ways to fund the growth of the business including the opportunity to raise additional working capital through the placing of shares on attractive terms.
·; The Company is looking to strengthen its Board through the appointment of up to two additional non-executive directors to bring in the skills needed to support the rapid growth of the business and this initiative is being led by Iain Ross, who joined the Coms board as a non-executive director in February.
Dave Breith (CEO) states
"Last year's results are disappointing but not unexpected. As I joined the Company just three weeks before the end of the last financial I could not influence last year's performance, however I do have control over the future of the business and I believe we have already demonstrated to investors, in the space of three months what can be achieved and the exciting potential for this business.
While there is much still to be done, I remain every bit as enthusiastic about this business as when I joined and would like to thank all Coms team members for their hard work in helping me achieve so much in so little time"
Contacts:
Coms plc
David Breith (CEO) +44 (0) 207 148 3000
Grant Thornton UK LLP (Nominated Adviser)
Colin Aaronson / Jen Clarke +44 (0) 207 383 5100
Simple Investments (Broker)
Andy Thacker / Nick Emerson +44 (0) 1483 413 500
Newgate Threadneedle (PR)
Graham Herring +44 (0) 207 653 9858
Notes to Editors
Coms plc is listed on the London Stock Exchange (AIM market) and is a leading player in the provision of Hosted VoIP Telephony to UK businesses with over 10-years' experience in the telecoms sector. Unlike most VoIP providers, Coms does not rely on third party providers and we own and operate a UK based Carrier Class Telephony Platform.
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