5 Aug 2009 07:00
| For release at 07.00 a.m. | Wednesday, 5 August 2009 |
STATPRO GROUP PLC
("StatPro", the "Group", or the "Company")
Interim results for the six months ended 30 June 2009
StatPro Group plc (AIM: SOG), the AIM listed provider of portfolio analytics and data solutions for the global asset management industry, announces its interim results for the six months ended 30 June 2009.
|
| Six months ended 30 June 2009 | Six months ended 30 June 2008 | Change |
| Revenue | £15.55 million | £13.07 million | +19% |
| Profit before tax | £4.01 million | £1.02 million | +295% |
| Adjusted profit before tax* | £3.19 million | £1.96 million | +63% |
| Adjusted EBITDA* | £4.04 million | £2.98 million | +35% |
| Adjusted operating profit margin* | 23.5% | 20.5% |
|
| Annualised recurring contract value | £28.25 million | £23.78 million | +19% |
| Earnings per share - basic | 5.2p | 1.6p | +225% |
| - adjusted* | 4.3p | 3.1p | +39% |
| Interim dividend per share | 0.6p | 0.5p | +20% |
Highlights:
Trading in first half ahead of expectations
Increasingly high levels of revenue visibility, with recurring revenues 92% of total revenue (2008: 86%)
Adjusted EBITDA* up 35% and underpinned by stronger recurring revenue element
Continued solid cash generated from operations amounting to £5.33 million (2008: £3.42 million)
Net debt reduced to £10.81 million from £14.62 million at December 2008 (£13.46 million pro-forma after re-financing)
Exceptional gain amounting to £1.16 million on re-financing
* adjusted for exceptional items, amortisation of acquired intangibles and share based payments (see notes 2 and 4)
Commenting on the results, Justin Wheatley, Chief Executive of StatPro said: "The strength of our business model and the growing capability of our expanding global sales team mean that we have had an extremely successful first half of the year. Both the renewal rates amongst current customers and the sales into new customers have been higher than expected. We are experiencing good levels of activity across all markets for all products and have excellent visibility on our pipeline. We therefore feel confident in the outlook for the rest of the year."
For further information, please contact:
| StatPro Group plc | www.statpro.com | |
| Justin Wheatley, Chief Executive | 020 8410 9876 | |
| Andrew Fabian, Finance Director | ||
| Cenkos Securities | ||
| Jon Fitzpatrick / Ken Fleming | 0131 220 6939 | |
| Julian Morse | 020 7397 1931 | |
| ICIS | ||
| Tom Moriarty / Caroline Evans-Jones | 020 7651 8688 |
A briefing for analysts will be held at 9.30am today at the offices of
ICIS, 3rd Floor, Aldermary House, 10-15 Queen Street, London, EC4N 1TX
About StatPro
StatPro is a leading provider of portfolio analytics and data solutions for the global asset management industry. The Company sells a SaaS-based Analytics and Data platform on a rental basis to investment management companies allowing them to analyse portfolio performance, attribution, risk and GIPS® compliance. StatPro also provides market data and valuation feeds including a Complex Asset Pricing service.
StatPro has grown its recurring revenue from less than GBP 1 million in 1999 to GBP 28.3 million at end June 2009 and currently enjoys a renewal rate of approximately 95%. StatPro floated on the London Stock Exchange in May 2000 and transferred its listing in June 2003 to AIM. The Company has operations in Europe, North America, South Africa and Australia, with approximately 80% of recurring revenues being generated outside the UK.
CHIEF EXECUTIVE'S REVIEW
Introduction - an excellent first half
In the face of challenging market conditions this was an excellent performance. As our shareholders will know we took action early to deal with the radical change in the business environment whilst at the same time pressing on with the execution of our growth strategy. This was based around two major pillars: the development and roll out of a SaaS offering and the growth of data services. This has been our goal and we have delivered against these ambitions. These results reflect that. Far from being complacent, our goal now is to build upon this success, and that is our intention for the future.
Financial highlights - increased revenues, profits and reducing debt position
Trading in the first half of 2009 has been better than expected with revenue increasing 19% to £15.55 million (2008: £13.07 million) and adjusted profit before tax rising 63% to £3.19 million (2008: £1.96 million). As a result, adjusted earnings per share increased by 39% to 4.3p (2008: 3.1p). Profit before tax was significantly higher at £4.01 million (2008: £1.02 million) partly due to an exceptional gain of £1.16 million following the re-financing of our debt in February 2009. The benefit of that gain together with generally improved trading and cash flow has meant that our net debt has reduced to £10.81 million compared to £14.62 million on 31 December 2008 and £16.15 million on 30 June 2008. Cash flow from operations increased to £5.33 million (2008: £3.42 million). The heart of our business is the contracted annual recurring revenue and at 30 June 2009 this stood at £28.25 million (2008: £23.78 million). Furthermore, recurring revenue accounted for 92% of our recognised revenue for the first half of 2009 (2008: 86%).
Trading - better than expected
Last year we cautioned that trading was likely to be difficult but at the same time we expressed confidence that our business model would stand us in good stead. This has certainly proven to be the case. It appears that whilst many asset managers were shocked by the economic downturn, the liquidity squeeze has subsided and given way to opportunities to invest at much lower valuations. The low level of interest rates has encouraged savers to put their money back into the equity and bond markets and that has boosted asset managers. Additionally, we are now operating in a highly cost-conscious market. As our central selling point is that our product range can greatly reduce the total cost of ownership, we are experiencing a mild increase in new business levels in contrast to the expected mild reduction.
Strategy - roll out SaaS, focus on data
It is our strategy to offer all our products on-line as a service (Software as a Service or "SaaS"). Today, less than a year after we launched our new SaaS offering, approximately 15% of our software revenue is supplied on-line with 38 installations. This growth is due in part to converting existing customers to our on-line service with the remainder from new customers. We have seen considerable benefits from this change with the implementation of new clients now dramatically faster than before, coupled with significantly improved service levels. We have a pipeline of other clients waiting to convert to the SaaS platform.
A second aspect to our strategy is to supply data with our software to minimise implementation time. Over the last six months we have added considerably to the number of index families we cover and we aim to have almost all of the important indices covered by the end of the year. We also supply corporate action data, market prices and sector definition data with our service covering global equities and global sovereign and corporate debt.
These steps will make it easier for us to cross-sell our products to existing clients and make our offering more compelling to new prospects. As we add further data, so our software functionality will become richer and more useful.
Development focused on greatly broadening potential addressable market
We are planning to launch StatPro Analytics Version 7 at the end of 2009. Version 7 provides a unified interface for all our products. It is further optimised as an on-line solution and is significantly faster than the previous version. We have also made considerable progress with our SaaS2 product which is a purpose-built multi-tenant system that will offer analytics on-line on a "per portfolio" basis, thus reducing the cost for smaller asset managers and pension funds. This product will greatly broaden our potential addressable market. SaaS2 is due to be launched in the first quarter of 2010.
Sales infrastructure much more effective with planned expansion
The streamlining of our service to an all-in-one solution, accessed on-line, will enable the sale of our products into a broader market than has historically been possible. The simplification of the service also makes it easier to scale up the size of our sales teams as the degree of product expertise required is reduced. To this end we have recently recruited an experienced sales director for our UK and European operations with the mandate to restructure and grow our existing sales force. We carried out a similar process last year in North America and the benefits of this are tangible in terms of new sales and greatly improved pipeline. We currently have approximately 25 people in sales and account management globally and we aim to increase this to over 35 in the next 18 months.
People - an excellent performance by all
I would like to thank all our staff for the tremendous work they have done so far this year. With the various developments coming to fruition it feels that there is a sense of optimism as we look forward to the rest of the year.
New non-executive director brings added experience and expertise to management team
As announced today in a separate release, we are delighted to confirm the appointment of Stuart J. Clark as a Non-Executive Director of the Company, with effect from 1 September 2009. Stuart was previously President and Chief Executive Officer of Interactive Data Corporation ("IDC"). Stuart became CEO of IDC in February 2000 and has led the business through nine years of continuous and strong growth, with revenues more than doubling to over US$750 million with profitability and cash flow growing more than threefold. IDC consistently outperformed the market in growth over that period and, at around 30%, had close to the highest operating profit margin amongst major comparable players in its industry. Stuart Clark is a high profile executive in our market place and his experience, especially in the area of financial data, analytics and solutions will add great value to StatPro. We welcome him to our Board and look forward to working with him on our expansion plans.
Interim dividend increases by 20%
The Board is pleased to announce an interim dividend of 0.6 pence per share which is an increase of 20% on last year's interim dividend of 0.5 pence. We intend to maintain a progressive dividend policy reflecting the balance between the investment needs of the business and growth in the underlying cash and earnings per share, as well as our confidence in the future.
Outlook is positive
The strength of our business model and the growing capability of our expanding global sales team mean that we have had an extremely successful first half of the year. Both the renewal rates amongst current customers and the sales into new customers have been higher than expected. We are experiencing good levels of activity across all markets for all products and have excellent visibility on our pipeline. We therefore feel confident in the outlook for the rest of the year.
Justin Wheatley
Chief Executive
FINANCIAL REVIEW
Overview
During the first six months of 2009 we have continued to increase our underlying contracted recurring revenue, which is our key performance indicator, and the proportion of the Group's total revenue that is recurring is now 92% (2008: 86%). With the benefit of further underlying revenue growth and the restructuring in 2008, these results demonstrate the positive operational gearing of the business with the adjusted operating profit margin increasing to 23.5% (2008: 20.5%). The adjusted EBITDA in H1 2009 grew from £2.98 million to £4.04 million and the business continues to generate a solid positive operating cash flow.
The increased operating profits combined with lower interest charges (together with the exceptional gain of £1.16 million following the refinancing in February 2009) has resulted in a significantly improved profit before tax, which increased by 295% to £4.01 million (2008: £1.02 million). Adjusted for exceptional items, amortisation of acquired intangibles and share based payments, the adjusted profit before tax increased by 63% to £3.19 million (2008: £1.96 million) as shown in note 4.
Revenue
Revenue increased by 19% to £15.55 million (2008: £13.07 million). Adjusting for the impact of the additional two months of the Performa acquisition in 2009 compared to H1 2008, the underlying growth rate was approximately 18% as shown below.
|
| Six months to | Six months to | Growth |
| 30 June | 30 June | % | |
| 2009 | 2008 |
| |
| £ million | £ million |
| |
| Group revenue |
| ||
| Total revenue as reported | 15.55 | 13.07 | +19% |
| Acquisition in 2008 - Performa | (1.07) | (0.76) |
|
| Underlying revenue | 14.48 | 12.31 | +18% |
New recurring business signed in H1 2009 was ahead of our expectations given the difficult market conditions and the level of cancellations was below budget with a renewal rate of approximately 95%.
The split of revenue by type was as follows:
|
| Six months to | Six months to | Year to |
| 30 June | 30 June | 31 December | |
| 2009 | 2008 | 2008 | |
| £ million | £ million | £ million | |
| Revenue |
| ||
| Software licences | 11.72 | 9.51 | 20.64 |
|
|
| ||
| Data fees | 2.57 | 1.76 | 4.12 |
|
|
| ||
| Total recurring revenue | 14.29 | 11.27 | 24.76 |
|
|
| ||
| Professional services and other revenue | 1.26 | 1.80 | 3.11 |
| Total revenue | 15.55 | 13.07 | 27.87 |
Recurring revenue
Overall recurring revenue grew by 27%; recurring software licence revenue grew by 23% and data fees grew by 46%. The proportion by value of recurring software licences on multi-year contracts (licence agreements with more than one year remaining contractually committed) was 80% at the end of June 2009 compared to 64% at the end of June 2008. New business from existing clients was 56% (2008: 65%) and our top 30 clients have an average of 4.5 products per client (2008: 4.6). The annualised recurring revenue per client at period end exchange rates for our top 30 increased to £451,000 from £381,000 at 30 June 2008.
The annual value of contracted recurring revenue increased by 19% to £28.25 million from £23.78 million at 30 June 2008 and the underlying recurring revenue increased by around 6% from the start of the year, as shown below.
| Software licences and data fees |
| Annualised recurring contract value £ million | % of starting year value |
| At 31 December 2008 | 28.39 |
| |
| Net impact of exchange rates | (1.82) |
| |
| At 1 January 2009 (at 30 June 2009 rates) | 26.57 | 100% | |
|
|
| ||
| New contracted revenue (net of cancellations) | 1.68 | 6.3% | |
|
|
| ||
| At 30 June 2009 |
| 28.25 | 106.3% |
Professional services revenue was lower by 30% as a number of clients focussed on reducing their consultancy budgets in the first six months of 2009; it remains to be seen whether this trend will continue into the second half of the year.
Operating expenses
Operating expenses (before amortisation of intangibles and exceptional items) amounted to £11.00 million in the first half of 2009 (2008: £9.47 million). Part of the increase year on year relates to a higher proportion of development costs expensed in the period compared to 2008. The other main areas of increased expenditure relate to a larger sales team, purchased data and contractors. We have strengthened our sales infrastructure and we plan to invest further in our distribution to allow us to grow our sales at a faster rate. The increase in purchased data allows us to broaden our data offering such as additional indices and going forward we expect to invest further in the data business. We have made greater use of contractors in 2009 for both external consulting and internal projects as this gives us more flexibility to adjust our cost base to changes in market conditions.
Exceptional items
The redemption in February 2009 of our old financing facility, with our new Royal Bank of Scotland five year facility, has resulted in an exceptional pre-tax gain of £1.16 million, being the difference between the amount repaid and the carrying value of the debt. In H1 2008, there were exceptional costs amounting to £0.56 million relating to severance costs, onerous contracts and costs associated with restructuring the operation of the combined Group following the Performa acquisition.
Employees
The average number of employees during the first six months of 2009 reduced to 240 compared with 253 in the first half of 2008. The number of employees currently in the Group is 242 employees, situated in eleven offices in Europe, North America, South Africa and Australia.
Development costs
We continue to invest in developing a number of new products and services including Software as a Service ("SaaS"), Complex Asset Pricing, Data Indices and other projects. However, following the restructuring of our development team last year the level of development costs capitalised was lower in H1 2009 at £1.02 million (2008: £1.49 million).
The amortisation of intangibles including development costs and acquired intangibles amounted to £1.23 million (2008: £1.29 million). The carrying value of intangibles (including acquired intangibles) recognised amounted to £5.56 million (Dec 2008: £5.91 million).
Earnings before interest, tax, depreciation and amortisation
Overall the adjusted EBITDA in H1 grew from £2.98 million to £4.04 million and the business continues to generate a solid positive operating cash flow. The adjusted operating margin increased from 20.5% in H1 2008 to 23.5% in H1 2009.
Finance income and expense
The £1.16 million exceptional pre-tax gain on refinancing is included within financing income for the period. Net finance expense before exceptional items reduced to £0.47 million (2008: £0.73 million) as a result of lower overall net debt and reductions in global interest rates.
Profit before tax
The profit before tax increased by 295% to £4.01 million from £1.02 million. The adjusted profit before tax increased by 63% to £3.19 million from £1.96 million.
Taxation
The total tax charge amounted to £0.91 million (2008: £0.13 million), giving an underlying rate of tax of approximately 20%. The level of deferred tax asset reduced to £1.52 million (Dec 2008: £2.37 million) as a result of an increase in deferred tax charge; nevertheless the current tax charge remains low and during the period there was a small net tax refund.
Earnings per share
Basic earnings per share increased to 5.2p (2008: 1.6p). Adjusted earnings per share increased to 4.3p (2008: 3.1p). The average number of shares in issue in the period increased by approximately 10% to 59,547,458 (2008: 54,063,787) mainly as a result of the Placing in October 2008. The diluted earnings per share were 5.2p (2008: 1.6p) based on potentially dilutive shares outstanding amounting to 96,642 (2008: 1,273,118).
Cash flow
Cash inflow from operations before investment in development activities during the first six months of 2008 amounted to £5.33 million (2008: £3.42 million). The investment in development activities was £1.02 million (2008: £1.49 million). As a result, the cash inflow from operations after investment in development activities amounted to £4.31 million (2008: £1.93 million) in the first six months of 2009 (see note 5).
In May 2009 the final dividend for 2008 amounting to 1.25 pence per share (£0.76 million) was paid.
Balance sheet
The Group's net assets increased to £30.89 million at June 2009 (Dec 2008: £30.17 million). The level of trade and other receivables, of which the major component is trade debtors, reduced to £5.94 million (Dec 2008: £8.56 million) as a result of improved cash collection in the period.
There was a reduction in net debt to £10.81 million at 30 June 2009 from £14.62 million at December 2008.
The major component of creditors is deferred income, a non-cash liability, which amounted to £11.05 million (Dec 2008: £13.06 million). The level of deferred contingent consideration is estimated at £0.72 million at the end of June 2009 (Dec 2008: £1.33 million).
Financial facilities
As announced on 19 February 2009, the Company signed a 5 year senior debt credit facility agreement with The Royal Bank of Scotland plc. The key features of the new facilities are:
Secured committed facility to February 2014
Term loan of £7.0 million with bullet repayment in February 2014
Multi-currency fully revolving five-year amortising loan amounting to an initial value of £10.25 million with six-monthly repayments
Flexibility to repay early with no penalty and to redraw within the amortising limits
Multi-currency revolving working capital loan amounting to £2.0 million
The arrangement fees and associated professional charges amounted to approximately 5% of the nominal value of the facility and in accordance with IAS 39 these fees have been capitalised and released as a financing charge over the life of the facility. The carrying value of the fees at 30 June 2009 was approximately £0.89 million.
We have already re-paid part of the facility (which we are able to re-draw subject to remaining within covenants) and the headroom on the facility including overdraft at end June 2009 amounted to approximately £6.0 million.
Interim dividend
The directors intend to increase the interim dividend by 20% to 0.6 pence per ordinary share (2008: 0.5 pence), which will be paid on 4 November 2009 to shareholders on the register at the close of business on 9 October 2009, reflecting the Board's confidence in the business prospects. The Board intends to maintain a progressive dividend policy reflecting the balance between the investment needs of the business and maintaining a prudent dividend cover.
Principal risks and uncertainties
The directors continue to evaluate the principal business risks and uncertainties affecting the Group and provided below is a summary of these risks, although it is not intended to be an exhaustive list. Further discussion of the principal risks and uncertainties can be found in the 2008 Annual Report.
Loss of key customer contracts
Insufficient level of new business contracted or delays in contract completion
Liquidity risk (i.e. insufficient working capital or other financing)
Competitor products
Inability to recruit or retain high calibre management and employees
Loss of good reputation
Development delays or undetected errors in software
Data or software hosting delivery failure
Technological change
For each category of risk, the directors have identified means by which the risk can be managed or reduced in a cost effective way, whilst accepting that some risks cannot be completely eliminated.
Andrew Fabian
Finance Director
Group Income Statement
| Notes | Unaudited | Unaudited | Audited | |
| Six months to 30 June | Six months to 30 June | Year to 31 December | ||
| 2009 | 2008 | 2008 | ||
| £'000 | £'000 | £'000 | ||
| Group Revenue | ||||
| Continuing operations | 15,551 | 13,070 | 27,871 | |
| Operating expenses before amortisation of intangibles |
| (10,997) | (9,474) | (19,968) |
| Amortisation of internally generated intangibles | (953) | (975) | (1,874) | |
| Amortisation of acquired intangibles | (282) | (317) | (659) | |
| Exceptional items |
| - | (564) | (2,600) |
| Operating expenses | (12,232) | (11,330) | (25,101) | |
| Operating profit | 3,319 | 1,740 | 2,770 | |
| Finance income | 6 | 43 | 67 | |
| Finance expense | (478) | (768) | (1,545) | |
| Exceptional gain on re-financing | 1,158 | - | - | |
| Net finance income/(expense) | 686 | (725) | (1,478) | |
| Profit before taxation | 4,005 | 1,015 | 1,292 | |
| Taxation | (906) | (129) | (190) | |
| Profit for the period | 3,099 | 886 | 1,102 | |
| (Loss)/profit attributable to minority interests | (11) | 28 | 78 | |
| Profit attributable to equity shareholders | 3,110 | 858 | 1,024 | |
| 3,099 | 886 | 1,102 | ||
| Earnings per share - basic | 2 | 5.2p | 1.6p | 1.8p |
| - diluted | 2 | 5.2p | 1.6p | 1.8p |
Statement of Comprehensive Income
| Unaudited | Unaudited | Audited | |
| Six months to 30 June | Six months to 30 June | Year to 31 December | |
| 2009 | 2008 | 2008 | |
| £'000 | £'000 | £'000 | |
| Profit for the period | 3,099 | 886 | 1,102 |
| Other comprehensive income: | |||
| Net exchange differences offset in reserves net of tax | (1,741) | (443) | 1,609 |
| Total comprehensive income for the period | 1,358 | 443 | 2,711 |
| Attributable to: | |||
| Minority interests | (16) | 28 | 81 |
| Equity shareholders | 1,374 | 415 | 2,630 |
| Total comprehensive income for the period | 1,358 | 443 | 2,711 |
Group Balance Sheet
| Notes | Unaudited | Unaudited | Audited | |
| As at 30 June | As at 30 June | As at 31 December | ||
| 2009 | 2008 | 2008 | ||
| £'000 | £'000 | £'000 | ||
| Non current assets | ||||
| Goodwill | 43,164 | 41,341 | 45,760 | |
| Intangible assets | 5,560 | 6,646 | 5,909 | |
| Property, plant and equipment | 2,239 | 2,362 | 2,446 | |
| Other receivables | 242 | 333 | 321 | |
| Deferred tax assets | 1,520 | 1,737 | 2,374 | |
| 52,725 | 52,419 | 56,810 | ||
| Current assets | ||||
| Trade and other receivables | 5,941 | 6,986 | 8,561 | |
| Cash and cash equivalents | 1,518 | 1,502 | 4,263 | |
| 7,459 | 8,488 | 12,824 | ||
| Liabilities | ||||
| Current liabilities | ||||
| Financial liabilities - borrowings | (1,149) | (1,675) | (5,859) | |
| Trade and other payables | (4,141) | (4,244) | (5,280) | |
| Current tax liabilities | (447) | (75) | (225) | |
| Deferred income | (10,988) | (9,877) | (12,821) | |
| Provisions - contingent consideration | (719) | (1,319) | (1,168) | |
| Provisions - onerous contracts | (164) | - | (373) | |
| (17,608) | (17,190) | (25,726) | ||
| Net current liabilities | (10,149) | (8,702) | (12,902) | |
| Non-current liabilities | ||||
| Financial liabilities - borrowings | (11,181) | (15,978) | (13,023) | |
| Other creditors and accruals | (316) | - | (51) | |
| Deferred income | (66) | (100) | (243) | |
| Provisions - contingent consideration | - | (1,504) | (157) | |
| Provisions - onerous contracts | (125) | - | (266) | |
| (11,688) | (17,582) | (13,740) | ||
| Net assets | 30,888 | 26,135 | 30,168 | |
| Shareholders' equity | ||||
| Ordinary shares | 9 | 597 | 546 | 595 |
| Share premium | 9 | 16,333 | 14,340 | 16,276 |
| Shares to be issued | 9 | 827 | 827 | 827 |
| Other reserves | 9 | 4,176 | 3,863 | 5,912 |
| Retained earnings | 9 | 8,928 | 6,569 | 6,515 |
| Total shareholders' equity | 30,861 | 26,145 | 30,125 | |
| Minority interest in equity | 9 | 27 | (10) | 43 |
| Total equity | 9 | 30,888 | 26,135 | 30,168 |
Group Cash Flow Statement
| Unaudited | Unaudited | Audited | ||
| Notes | Six months to 30 June | Six months to 30 June | Year to 31 December | |
| 2009 | 2008 | 2008 | ||
| £'000 | £'000 | £'000 | ||
| Cash flows from operating activities | ||||
| Cash generated from operations | 6 | 5,329 | 3,420 | 8,345 |
| Interest received | 6 | 43 | 67 | |
| Interest paid | (489) | (562) | (1,545) | |
| Tax paid | (119) | (193) | (324) | |
| Tax received | 127 | - | - | |
| Net cash from operating activities | 4,854 | 2,708 | 6,543 | |
| Cash flows from investing activities | ||||
| Acquisition of subsidiaries (net of cash acquired) | (473) | (5,482) | (6,731) | |
| Investment in intangible assets - development costs | (1,019) | (1,494) | (2,535) | |
| Purchase of property, plant and equipment | (303) | (884) | (1,189) | |
| Net cash used in investing activities | (1,795) | (7,860) | (10,455) | |
| Cash flows from financing activities | ||||
| Repayment of bank loan on refinancing | (17,629) | (1,270) | (2,918) | |
| Repayment of new bank loan | (4,789) | - | - | |
| Proceeds from new bank loan/overdraft | 18,387 | 7,879 | 9,002 | |
| Financing costs for new bank loan | (958) | (190) | (190) | |
| Proceeds from issue of ordinary shares | 27 | 17 | 2,001 | |
| Dividends paid to shareholders | (755) | (582) | (860) | |
| Net cash (used in)/from financing activities | (5,717) | 5,854 | 7,035 | |
| Effects of exchange rate changes | (87) | (150) | 190 | |
| Net (decrease)/increase in cash and cash equivalents | (2,745) | 552 | 3,313 | |
| Cash and cash equivalents at start of period | 4,263 | 950 | 950 | |
| Cash and cash equivalents at end of period | 1,518 | 1,502 | 4,263 |
Notes to the interim financial information
1. This announcement was approved by the Board of directors on 4 August 2009. The financial information set out in this interim statement has been prepared under IFRSs as adopted by the European Union and on the basis of the accounting policies set out in the statutory accounts of StatPro Group plc for the year ended 31 December 2008, with the exception of the adoption of IAS 1 (revised). This report is not prepared in accordance with IAS 34 which is currently not mandatory. This interim statement has not been audited but has been reviewed by the Company's auditors PricewaterhouseCoopers LLP. The financial information does not constitute statutory accounts within the meaning of section 240 of the Companies Act 1985. Statutory accounts for StatPro Group plc for the year ended 31 December 2008 reported under IFRS, on which the auditors gave an unqualified opinion, have been delivered to the Registrar of Companies. Copies of this statement will be posted to shareholders. Further copies are available free of charge on request from the Company Secretary at the Company's registered office, StatPro House, 81-87 Hartfield Road, London SW19 3TJ.
2. Basic earnings per share. Basic earnings per share has been calculated based on the profit after taxation and minority interests of £3.11 million (2008: £0.86 million) and the weighted average number of shares of 59,547,458 (2008: 54,063,787). The diluted earnings per share were 5.2p (2008: 1.6p) based on potentially dilutive shares outstanding amounting to 96,642 (2008: 1,273,118). Adjusted earnings per share are shown in the table below.
|
| Earnings | Weighted average number of shares | Earnings per share | Earnings | Weighted average number of shares | Earnings per share |
|
| Six months to 30 June | Six months to 30 June | Six months to 30 June | Six months to 30 June | Six months to 30 June | Six months to 30 June |
|
| 2009 | 2009 | 2009 | 2008 | 2008 | 2008 |
|
| Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | Unaudited |
|
| £'000 | '000 | pence | £'000 | '000 | pence |
| Earnings per share - basic | 3,110 | 59,547 | 5.2 | 858 | 54,064 | 1.6 |
| Effect of amortisation of acquired intangibles | 282 | - | 0.5 | 317 | - | 0.6 |
| Effect of share based payments | 58 | - | 0.1 | 60 | - | 0.1 |
| Effect of exceptional items | (1,158) | - | (1.9) | 564 | - | 1.0 |
| Effect of tax on adjustments | 269 | - | 0.4 | (113) | - | (0.2) |
| Adjusted earnings per share | 2,561 | 59,547 | 4.3 | 1,686 | 54,064 | 3.1 |
| Potentially dilutive shares | - | 97 | 0.0 | - | 1,273 | (0.1) |
| Adjusted earnings per share - diluted | 2,561 | 59,644 | 4.3 | 1,686 | 55,337 | 3.0 |
3. Revenue analysis
Analysis of annualised recurring revenue by type
| Type | Sterling value at 30 June 2009 | Percentage | Sterling value at 30 June 2008 | Percentage | Sterling value at 31 December 2008 | Percentage |
| Unaudited | Unaudited | Audited | ||||
| £ millions | £ millions | £ millions | ||||
| Software licences | 23.33 | 82.6% | 19.86 | 83.5% | 23.38 | 82.4% |
| Data fees | 4.92 | 17.4% | 3.92 | 16.5% | 5.01 | 17.6% |
|
| 28.25 | 100.0% | 23.78 | 100.0% | 28.39 | 100.0% |
Analysis of annualised recurring revenue by region
| Region | Sterling value at 30 June 2009 Unaudited | Percentage | Sterling value at 30 June 2008 Unaudited | Percentage | Sterling value at 31 December 2008 Audited | Percentage |
| £ millions | £ millions | £ millions | ||||
| United Kingdom | 6.39 | 22.6% | 5.74 | 24.2% | 6.03 | 21.2% |
| Continental Europe | 7.32 | 25.9% | 6.55 | 27.5% | 7.95 | 28.0% |
| North America | 10.81 | 38.3% | 8.78 | 36.9% | 11.09 | 39.1% |
| Rest of World | 3.73 | 13.2% | 2.71 | 11.4% | 3.32 | 11.7% |
|
| 28.25 | 100.0% | 23.78 | 100.0% | 28.39 | 100.0% |
Analysis of annualised recurring revenue by currency
|
| Currency value | Exchange rate | Sterling value at | Percentage |
| As at 30 June 2009 | millions | 30 June 2009 | 30 June 2009 | |
|
| Unaudited | |||
| Currency | £ millions | |||
| Pounds sterling | GBP 5.96 | 1.000 | 5.96 | 21.1% |
| Euro | EUR 9.19 | 1.174 | 7.83 | 27.7% |
| US Dollar | USD 8.58 | 1.647 | 5.21 | 18.4% |
| Canadian Dollar | CAD 11.05 | 1.913 | 5.78 | 20.5% |
| Other currencies | 3.47 | 12.3% | ||
|
|
|
| 28.25 | 100.0% |
|
| Currency value | Exchange rate | Sterling value at | Percentage |
| As at 30 June 2008 | millions | 30 June 2008 | 30 June 2008 | |
|
| Unaudited | |||
| Currency | £ millions | |||
| Pounds sterling | GBP 5.88 | 1.000 | 5.88 | 24.7% |
| Euro | EUR 8.64 | 1.263 | 6.84 | 28.8% |
| US Dollar | USD 7.58 | 1.990 | 3.81 | 16.0% |
| Canadian Dollar | CAD 9.95 | 2.019 | 4.93 | 20.7% |
| Other currencies | 2.32 | 9.8% | ||
|
|
|
| 23.78 | 100.0% |
|
| Currency value | Exchange rate | Sterling value at | Percentage |
| As at 31 December 2008 | millions | 31 December 2008 | 31 December 2008 | |
|
| Audited | |||
| Currency | £ millions | |||
| Pounds sterling | GBP 5.78 | 1.000 | 5.78 | 20.4% |
| Euro | EUR 8.69 | 1.034 | 8.40 | 29.6% |
| US Dollar | USD 7.75 | 1.438 | 5.39 | 19.0% |
| Canadian Dollar | CAD 10.12 | 1.775 | 5.70 | 20.1% |
| Other currencies | 3.12 | 10.9% | ||
|
|
|
| 28.39 | 100.0% |
4. Adjusted profit before taxation, adjusted operating profit margin and adjusted EBITDA
Adjusted profit before taxation
|
| Unaudited | Unaudited | Audited |
|
| Six months to 30 June | Six months to 30 June | Year to 31 December |
|
| 2009 | 2008 | 2008 |
|
|
| ||
|
| £'000 | £'000 | £'000 |
| Profit before taxation | 4,005 | 1,015 | 1,292 |
| Add back: Amortisation on acquired intangibles | 282 | 317 | 659 |
| Add back: Share based payments | 58 | 60 | 118 |
| (Deduct)/Add back: Exceptional items | (1,158) | 564 | 2,600 |
| Adjusted profit before tax | 3,187 | 1,956 | 4,669 |
Adjusted operating profit
|
| Unaudited | Unaudited | Audited |
|
| Six months to 30 June | Six months to 30 June | Year to 31 December |
|
| 2009 | 2008 | 2008 |
|
|
| ||
|
| £'000 | £'000 | £'000 |
| Operating profit | 3,319 | 1,740 | 2,770 |
| Add back: Amortisation on acquired intangibles | 282 | 317 | 659 |
| Add back: Share based payments | 58 | 60 | 118 |
| Add back: Exceptional operating items | - | 564 | 2,600 |
| Adjusted operating profit | 3,659 | 2,681 | 6,147 |
| Adjusted operating profit margin | 23.5% | 20.5% | 22.1% |
Adjusted EBITDA
|
| Unaudited | Unaudited | Audited |
|
| Six months to 30 June | Six months to 30 June | Year to 31 December |
|
| 2009 | 2008 | 2008 |
|
|
| ||
|
| £'000 | £'000 | £'000 |
| Operating profit | 3,319 | 1,740 | 2,770 |
| Add back: Depreciation of fixed assets | 376 | 303 | 605 |
| Add back: Amortisation on acquired intangibles | 282 | 317 | 659 |
| Add back: Share based payments | 58 | 60 | 118 |
| Add back: Exceptional operating items | - | 564 | 2,600 |
| Adjusted EBITDA | 4,035 | 2,984 | 6,752 |
The exceptional gain on refinancing in H1 2009 resulted from the redemption of the old financing facility at an amount below the carrying value of the debt. The operating exceptional items of £564,000 included in total operating expenses in H1 2008 related to severance payments, onerous leases and other contracts, and costs relating to restructuring the operations of the combined Group. There were no operating exceptional items in 2009.
5. Cash generated from operations - reconciliation from statutory heading to business performance measure
|
| Unaudited | Unaudited | Audited |
|
| Six months to 30 June | Six months to 30 June | Year to 31 December |
|
| 2009 | 2008 | 2008 |
|
|
| ||
|
| £'000 | £'000 | £'000 |
| Cash generated from operations | 5,329 | 3,420 | 8,345 |
| Investment in intangible assets - development costs | (1,019) | (1,494) | (2,535) |
| Cash generated from operations less internally generated intangible assets | 4,310 | 1,926 | 5,810 |
Free cash flow
|
| Unaudited | Unaudited | Audited |
|
| Six months to 30 June | Six months to 30 June | Year to 31 December |
|
| 2009 | 2008 | 2008 |
|
|
| ||
|
| £'000 | £'000 | £'000 |
| Cash generated from operations | 5,329 | 3,420 | 8,345 |
| Net interest paid | (483) | (519) | (1,478) |
| Net tax received/(paid) | 8 | (193) | (324) |
| Purchase of property, plant and equipment | (303) | (884) | (1,189) |
| Investment in intangible assets - development costs | (1,019) | (1,494) | (2,535) |
| Cash generated from operations less internally generated intangible assets | 3,532 | 330 | 2,819 |
6. Reconciliation of operating profit to net cash flow from operating activities
|
| Unaudited | Unaudited | Audited |
|
| Six months to 30 June | Six months to 30 June | Year to 31 December |
|
| 2009 | 2008 | 2008 |
|
|
| ||
|
| £'000 | £'000 | £'000 |
|
|
| ||
| Operating profit | 3,319 | 1,740 | 2,770 |
| Depreciation of tangible fixed assets | 376 | 303 | 605 |
| Amortisation of intangibles | 1,235 | 1,292 | 2,533 |
| Internal developments write down following restructuring | - | - | 706 |
| Decrease/(increase) in debtors | 2,550 | 1,183 | (1,163) |
| (Decrease)/increase in creditors (excluding deferred income) | (1,110) | (829) | 329 |
| (Decrease)/increase in deferred income | (1,099) | (329) | 2,427 |
| Loss on disposal of fixed assets | - | - | 20 |
| Share based payments | 58 | 60 | 118 |
| Net cash inflow from operating activities | 5,329 | 3,420 | 8,345 |
7. Reconciliation of net cash flow to movement in net debt
|
| Unaudited | Unaudited | Audited |
|
| Six months to 30 June | Six months to 30 June | Year to 31 December |
|
| 2009 | 2008 | 2008 |
|
|
| ||
|
| £'000 | £'000 | £'000 |
|
|
| ||
| (Decrease)/increase in cash and cash equivalents in the period | (2,745) | 552 | 3,313 |
| Movement on overdraft and other loans | (1,138) | (879) | (2,002) |
| Movement on bank loans | 6,127 | (5,540) | (3,892) |
| Exchange differences on bank loans and overdrafts | 386 | 39 | (2,008) |
| Other non-cash movements | 1,177 | (190) | 103 |
| Movement in net debt | 3,807 | (6,018) | (4,486) |
| Net debt at beginning of period | (14,619) | (10,133) | (10,133) |
| Net debt at end of period | (10,812) | (16,151) | (14,619) |
8. Dividend. An interim dividend for 2009 amounting to 0.6 pence per ordinary share (2008: 0.5 pence) will be paid on 4 November 2009 to shareholders on the register on 9 October 2009. A final dividend for 2008 amounting to 1.25 pence per ordinary share was paid on 20 May 2009. Under IFRS dividends are accounted for when paid and not when proposed or declared.
9. Statement of changes in equity
|
| Share capital | Share premium account | Shares to be issued | Retained earnings | Other reserves * | Minority interests | Total |
|
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 |
| At 1 January 2008 | 531 | 14,273 | 874 | 6,237 | 3,132 | (38) | 25,009 |
| Profit for the period | - | - | - | 858 | - | 28 | 886 |
| Other comprehensive income: | |||||||
| Exchange differences offset in reserves | - | - | - | - | (443) | - | (443) |
| Total comprehensive income | - | - | - | 858 | (443) | 28 | 443 |
| Transactions with owners: | |||||||
| Share based payments | - | - | - | 60 | - | - | 60 |
| Shares issued | 15 | 67 | (47) | (4) | 1,174 | - | 1,205 |
| Dividend | - | - | - | (582) | - | - | (582) |
| At 30 June 2008 | 546 | 14,340 | 827 | 6,569 | 3,863 | (10) | 26,135 |
|
| Share capital | Share premium account | Shares to be issued | Retained earnings | Other reserves * | Minority interests | Total |
|
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 |
| At 1 January 2009 | 595 | 16,276 | 827 | 6,515 | 5,912 | 43 | 30,168 |
| Profit for the period | - | - | - | 3,110 | - | (11) | 3,099 |
| Other comprehensive income: | |||||||
| Exchange differences offset in reserves | - | - | - | - | (1,736) | (5) | (1,741) |
| Total comprehensive income | - | - | - | 3,110 | (1,736) | (16) | 1,358 |
| Transactions with owners: | |||||||
| Share based payments | - | - | - | 58 | - | - | 58 |
| Shares issued | 2 | 57 | - | - | - | - | 59 |
| Dividend | - | - | - | (755) | - | - | (755) |
| At 30 June 2009 | 597 | 16,333 | 827 | 8,928 | 4,176 | 27 | 30,888 |
* Other reserves includes merger reserve and translation reserve.
Independent review report to StatPro Group plc
Introduction
We have been engaged by the Company to review the financial information in the half-yearly financial report for the six months ended 30 June 2009, which comprises the Group Income Statement, the Statement of Comprehensive Income, the Group Balance Sheet, the Group Cash Flow Statement and the related notes. We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the financial information.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the half-yearly financial report in accordance with the AIM Rules for Companies which require that the financial information must be presented and prepared in a form consistent with that which will be adopted in the Company's annual financial statements.
As disclosed in note 1, the annual financial statements of the Group are prepared in accordance with IFRSs as adopted by the European Union. The financial information included in this half-yearly financial report has been prepared in accordance with the basis of preparation set out in note 1.
Our responsibility
Our responsibility is to express to the Company a conclusion on the financial information in the half-yearly financial report based on our review. This report, including the conclusion, has been prepared for and only for the Company for the purpose of the AIM Rules for Companies and for no other purpose. We do not, in producing this report, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.
Scope of review
We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the financial information in the half-yearly financial report for the six months ended 30 June 2009 is not prepared, in all material respects, in accordance with the basis of preparation set out in note 1 and the AIM Rules for Companies.
PricewaterhouseCoopers LLP
Chartered Accountants
London
4 August 2009
Notes:
(a) The maintenance and integrity of the StatPro Group plc web site is the responsibility of the directors; the work carried out by the auditors does not involve consideration of these matters and, accordingly, the auditors accept no responsibility for any changes that may have occurred to the interim report since it was initially presented on the web site.
(b) Legislation in the United Kingdom governing the preparation and dissemination of financial information may differ from legislation in other jurisdictions.