Last checked at 30 Jul 2009 07:00
30 July 2009
Avisen plc
("Avisen" or the "Company")
Final results for the 11 month period ended 31 January 2009
The board of directors ("Board") of Avisen, the AIM quoted performance management specialist, is pleased to announce the Company's final results for the 11 month period ended 31 January 2009.
Highlights
Net profit increased to £505,229 (2008: Net loss of £4,910,515)
EPS of 2.1p (2008: Loss per Share 20.7p)
Avisen Group Limited acquired by the AIM quoted cash shell Z GROUP plc on 2nd February 2009 in a reverse take-over transaction
Post Balance Sheet Highlights
Three acquisitions completed; Wexner Global Limited, Eon Enterprises Limited and Quadrum Consulting (Propriety) Limited
Fourth acquisition, Inca Holdings Limited, announced 17 July 2009 - completion imminent
Marcus Hanke, CEO of Avisen, commented:
"Avisen's management team has grown the business rapidly in a relatively short period of time, both organically and through the pursuit of a targeted "buy-and-build" strategy. We are confident that we can continue to deliver growth and are excited by the prospect of becoming a leading player in the business intelligence and performance management market."
For further information, please contact:
| Avisen plc | |
| Marcus Hanke (CEO) | Tel: +44 (0)870 8802978 |
| Louis Peacock (Executive Director and Acting CFO) | Tel: +44 (0)7899 667533 |
| NOMAD and Broker: | |
| John East & Partners Limited, a subsidiary of Merchant Securities Plc | Tel: +44 (0)20 76282200 |
| Bidhi Bhoma | |
| Financial PR: | |
| Bishopsgate Communications | Tel: +44 (0)20 7562 3355 |
| Robyn Samuelson/Siobhra Murphy | |
| avisen@bishopsgatecommunications.com |
CHAIRMAN'S STATEMENT
I am pleased to present the results of the Company for the 11 month period ended 31 January 2009 (the Company's accounting reference date having been changed from 28 February to 31 January to reflect the acquisition of Avisen Group Limited ("Avisen Group"), described below).
RESULTS
The profit on ordinary activities after taxation for the period amounted to £505,229 (2008 - loss £4,910,515) representing earnings per share of 2.1 pence (2008 - loss per share 20.7 pence).
BACKGROUND INFORMATION ON THE COMPANY
Z GROUP plc was incorporated on 20 April 2005 and admitted to trading on AIM on 21 June 2005. At that time, the Company operated in the software and computer services sector. Following the disposal of its trading subsidiaries on 7 January 2008, the Company no longer had a trading business and accordingly the Company became an investing company pursuant to Rule 15 of the AIM Rules. In January 2008, the directors at that time stated that the Company intended to implement an investing strategy, in accordance with the AIM Rules, and seek a suitable investment opportunity for the Company, being a target in the technology, media or sciences sectors. Any potential acquisition would also need to satisfy the main criteria of having an experienced management team, a sizeable projected market for the target's products and/or services and the promising potential growth of that market.
KEY ACQUISITION
Having reviewed a large number of potential acquisition candidates, the business and future prospects of Avisen Group, a business and technology consultancy specialising in performance management, was seen to represent a significant opportunity for shareholders.
On 7 January 2009, the Company entered into a conditional acquisition agreement to acquire the entire issued share capital of Avisen Group, with the consideration to be satisfied by the issue of 86,666,667 new ordinary shares. The acquisition was conditional on the passing of certain resolutions proposed at a general meeting held on 30 January 2009 with re-admission to the AIM market becoming effective on 2 February 2009. Further information on Avisen Group and the rationale behind the acquisition is set out in the Company's AIM Admission Document which is available from the Company's website, www.avisenplc.com.
At the general meeting held on 30 January 2009, all resolutions were duly passed, which, subject only to the shares of the enlarged group being readmitted to trading on AIM, resulted in the Company completing the acquisition of Avisen Group and the Company's name being changed to Avisen plc.
EVENTS AFTER 31 JANUARY 2009, INCLUDING BOARD CHANGES AND ACQUISITIONS
The Company was readmitted to trading on AIM on 2 February 2009.
Upon completion of the acquisition, Marcus Hanke, Andrew Turner, Louis Peacock and Keith Jones were appointed to the Board and Ian Smith resigned from the Board. Jon Claydon remained as Non-Executive Chairman, Marcus Yeoman remained as a Non-Executive Director and Marcus Hanke was appointed as Chief Executive Officer. Duncan Neale resigned as Finance Director on 30 June 2009, at which point Louis Peacock was appointed as Interim Finance Director.
During the period since the end of the financial year the Company has completed three acquisitions; Wexner Global Limited ("Wexner"), Eon Enterprises Limited ("Eon") and Quadrum Consulting (Propriety) Limited ("Quadrum"). A fourth acquisition, Inca Holdings Limited, was announced on 17 July 2009 and is expected to be completed shortly.
Wexner has a successful history of working with blue chip clients to develop and implement their strategy. It works with them, with the aim of improving their profitability through increased productivity and cost reduction, transforming both their finance and their operational functions. The purchase of Wexner's assets, including its industry know-how and contacts, not only provides Avisen with access to Wexner's client base, but augments the Company's ability to provide high-end consulting and advisory services.
Eon's sole wholly owned subsidiary, Infocube Limited ("Infocube") is a leading IBM Cognos Business Partner. Infocube, founded in 1988, provides practical and cost-effective business intelligence, planning, forecasting and data warehousing solutions for its clients. Infocube works in partnership with Cognos, an IBM company, which is the world's leading developer of Enterprise Business Intelligence and Performance Management software, in order to provide a comprehensive range of services, including software licences, consultancy, development, training and post implementation support.
Quadrum, founded in 2006, is a South African business which provides business intelligence, planning, forecasting and activity based costing and financial consolidation solutions for its clients. Quadrum works in partnership with IBM Cognos in order to provide a comprehensive range of services, including software licenses, consultancy, development, training and post implementation support. Avisen is now positioned as a leading IBM Cognos reseller and consultancy both in the UK and in South Africa. The Company will have access to both Quadrum's blue-chip client base and its pool of skilled resources, which are intended to augment Avisen's offshore services capability.
The Board is delighted with the acquisitions and the process of integrating the businesses is either completed or well underway. These acquisitions are in line with the Company's stated strategy and the Board believes that they, in addition to Inca Holdings Limited, will make a significant contribution to the revenues of the Company and will improve its competitive position.
PROSPECTS
Avisen's management team have grown the business rapidly in a relatively short period of time, both organically and through the pursuit of a targeted "buy-and-build" strategy. We are confident that we can continue to deliver growth and are excited by the prospect of becoming a leading player in the business intelligence and performance management market.
JON CLAYDON
Non-executive Chairman
30 July 2009
CONSOLIDATED INCOME STATEMENT FOR THE 11 MONTH PERIOD ENDED 31 JANUARY 2009
| Notes | 11 months ended 31 January 2009 £ | Year ended 29 February 2008 £ | |
| Revenue | 8,750 | - | |
| Cost of sales | (5,000) | - | |
| Share based payments credit | 636,972 | 383,667 | |
| Other administrative expenses | (269,725) | (860,830) | |
| Proceeds on disposal of investments | - | 60,000 | |
| Write down of investments | - | (4,638,803) | |
| OPERATING PROFIT / (LOSS) | 2 | 370,997 | (5,055,966) |
| Finance income | 3 | 64,232 | 53,404 |
| Other income | 3 | 70,000 | 91,231 |
| PROFIT / (LOSS) BEFORE INCOME TAX | 505,229 | (4,911,331) | |
| Income tax credit | 4 | - | 816 |
| PROFIT / (LOSS) FOR THE PERIOD | 505,229 | (4,910,515) | |
| EARNINGS / (LOSS) PER SHARE (pence) | |||
| Basic | 5 | 2.13 | (20.68) |
| Diluted | 5 | 2.11 | (20.68) |
AUDITED CONSOLIDATED BALANCE SHEET AS AT 31 JANUARY 2009
| Notes | 31 January 2009 £ | 29 February 2008 £ | |
| ASSETS | |||
| Investments | 6 | - | - |
| Property, plant and equipment | 1,501 | 10,898 | |
| Other receivables | 117,500 | 117,500 | |
| Non-current assets | 119,001 | 128,398 | |
| Trade and other receivables | 377,959 | 374,552 | |
| Cash and cash equivalents | 7 | 1,165,131 | 1,203,824 |
| Current assets | 1,543,090 | 1,578,376 | |
| Total assets | 1,662,091 | 1,706,774 | |
| EQUITY AND LIABILITIES | |||
| Capital and reserves attributable to equity holders of the Company | |||
| Share capital | 1,187,294 | 1,187,294 | |
| Share premium account | 5,967,758 | 5,967,758 | |
| Share option reserve | 63,410 | 700,382 | |
| Retained losses | (5,793,965) | (6,299,194) | |
| Total equity | 1,424,497 | 1,556,240 | |
| Trade and other payables | 237,594 | 150,534 | |
| Current liabilities | 237,594 | 150,534 | |
| Total liabilities | 237,594 | 150,534 | |
| Total equity and liabilities | 1,662,091 | 1,706,774 | |
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE 11 MONTH PERIOD ENDED 31 JANUARY 2009
| Share capital | Share premium | Share based payments | Retained earnings | Total | |
| £ | £ | £ | £ | £ | |
| Balance at 1 March 2008 | 1,187,294 | 5,967,758 | 700,382 | (6,299,194) | 1,559,240 |
| Share option credit in the year | (636,972) | (636,972) | |||
| Profit for the period | 505,229 | 505,229 | |||
| Total recognised income and expense for the period | - | - | (636,972) | 505,229 | (131,743) |
| Balance at 31 January 2009 | 1,187,294 | 5,967,758 | 63,410 | (5,793,965) | 1,424,497 |
CONSOLIDATED CASH FLOW STATEMENT FOR THE 11 MONTH PERIOD ENDED 31 JANUARY 2009
| 11 months ended 31 January 2009 £ | Year ended 29 February 2008 £ | |
| Cash flows from operating activities | ||
| Operating profit / (loss) | 370,997 | (5,055,966) |
| Depreciation | 3,599 | 32,711 |
| Amortisation | - | 510 |
| Share option credit | (636,972) | (383,667) |
| Write down of investments sold in the year | - | 16,991,305 |
| (Increase) / Decrease in trade and other receivables | (3,406) | 2,388,261 |
| Increase / (Decrease) in trade and other payables | 87,060 | (14,417,368) |
| Write down of web development costs and domain names | - | 1,807 |
| Write down of property, plant and equipment | 5,798 | - |
| Cash used in operations | (172,924) | (442,407) |
| Income tax credit | - | 816 |
| Net cash (used in) operating activities | (172,924) | (441,591) |
| Cash flows from investing activities | ||
| Purchase of property, plant and equipment | - | (5,340) |
| Proceeds from the sale of property, plant and equipment | - | 99,649 |
| Repayment of overdraft | 705 | - |
| Interest received | 64,232 | 53,404 |
| Other income | 70,000 | 91,231 |
| Net cash from / (used in) investing activities | 134,937 | 238,944 |
| Net (decrease) in cash and cash equivalents | (37,987) | (202,647) |
| Cash and cash equivalents at the beginning of the period | 1,203,118 | 1,405,765 |
| Cash and cash equivalents at the end of the period | 1,165,131 | 1,203,118 |
NOTES TO THE PRELIMINARY RESULTS FOR THE 11 MONTH PERIOD ENDED 31 JANUARY 2009
1. BASIS OF PREPARATION
These financial statements have been prepared in accordance with International Financial Reporting Standards, International Accounting Standards and Interpretations (collectively IFRS) issued by the International Accounting Standards Board (IASB) as adopted by European Union ("adopted IFRSs"), and are in accordance with IFRS as issued by the IASB.
The financial information set out above does not constitute the Company's statutory accounts for the year ended 29 February 2008 and the 11 month period to 31 January 2009, but is derived from those accounts. Statutory accounts for the year ended 29 February 2008 have been delivered to the Registrar of Companies and those for the 11 month period ended 31 January 2009 will be delivered following the Company's Annual General Meeting. The Auditors have reported on those accounts; their reports were unqualified and did not contain statements under the Companies Act 1985, sections 237(2) or (3).
2. OPERATING PROFIT / (LOSS)
| 11 months ended 31 January 2009 £ | Year ended 29 February 2008 £ | |
| The Company's operating profit (2008: loss) is shown after charging / (crediting): | ||
| Significant items: | ||
| Write down on sale of fixed asset investments | - | 4,638,803 |
| Share based payments (credit) / charge | (636,972) | (383,667) |
| Depreciation | 3,599 | 32,711 |
| Amortisation | - | 510 |
| Fees payable to the Company's auditor for the audit of the Company's annual accounts | 5,000 | 12,000 |
| Other services related to taxation | 11,000 | 14,600 |
3. FINANCE & OTHER INCOME
| | 11 months ended 31 January 2009 £ | Year ended 29 February 2008 £ |
| Bank interest receivable | 64,232 | 53,404 |
| | | |
| Dividend income | 70,000 | - |
| | | |
| Rent income | - | 91,231 |
| | | |
| Finance and other income | 134,232 | 144,635 |
| | | |
4. INCOME TAX CREDIT
| 11 months ended 31 January 2009 £ | Year ended 29 February 2008 £ | |
| Factors affecting tax charge for period: | ||
| Profit / (Loss) on ordinary activities before tax | 505,229 | (4,911,331) |
| Profit / (Loss) on ordinary activities multiplied by standard rate of corporation tax in the UK of 30% (2008: 30%) | 151,569 | (1,473,399) |
| Effects of: | ||
| Expenses not deductible for tax purposes | 7,249 | 133,326 |
| Temporary differences in the recognition of profits or losses not recognised for tax purposes | - | 15,507 |
| Losses not recognised for tax purposes | (158,818) | 1,439,666 |
| Adjustment in respect of previous period's income tax | - | (816) |
| Share based payments not recognised for tax purposes | - | (115,100) |
| Tax credit for the period | - | (816) |
5. EARNINGS / (LOSS) PER SHARE
| 31 January 2009 No. | 29 February 2008 No. | |
| Weighted average number of shares: | ||
| For basic earnings per share | 23,745,885 | 23,745,885 |
| Dilutive effect of share options | 200,775 | - |
| For diluted earnings per share | 23,946,660 | 23,745,885 |
| Profit / (Loss) for the period | £505,229 | £(4,910,515) |
| Earnings / (Loss) per share: | ||
| pence | pence | |
| - Basic - Diluted | 2.13 2.11 | (20.68) (20.68) |
6. INVESTMENTS
| Cost and net book value: | £ |
| At 1 March 2008 | 16,991,305 |
| Book value of investments sold in the year | (16,991,305) |
| At 31 January 2009 | - |
7. CASH AND CASH EQUIVALENTS
| 31 January | 31 January | 29 February | 29 February | |
| 2009 | 2009 | 2008 | 2008 | |
| £ | Fixed interest rate thereon | £ | Fixed interest rate thereon | |
| Current account | 26,006 | 0.00% | 43,614 | 0.00% |
| Deposit accounts | 1,139,125 | 5.65% | 1,160,210 | 5.65% |
| 1,165,131 | 1,203,824 |
8. RELATED PARTY TRANSACTIONS
The only key management personnel of the Company are the Directors. Details of the compensation of the key management personnel, as required by IAS 24 "Related Party Disclosures", are disclosed in note 6 of the report and accounts of the Company for the 11 month period to 31 January 2009.
Jack Bekhor and Jamie True purchased the trading subsidiaries of the Company on 7 January 2009 (the "MBO"). Jack Bekhor and Jamie True remain related parties of the Company in their capacity as significant shareholders of the Company. A summary follows of the movements in the debt due to and from these related parties up to 31 January 2009:
| 11 months ended 31 January 2009 £ | Year ended 28 February 2008 £ | |
| Opening debt due from / (to) related parties | 328,534 | 590,447 |
| Cash forwarded by the Company to the related parties | - | 4,512,109 |
| Cash forwarded by the related parties to the Company | (234,059) | (4,757,361) |
| Other re-charges from the related parties | - | 332,552 |
| Other re-charges from the Company | - | (20,205) |
| Loan waiver to ex-subsidiary | - | (329,008) |
| Closing debt due from related parties | 94,475 | 328,534 |
|
|
|
The closing debt of £94,475 has been paid to the Company after the period end.
9. POST BALANCE SHEET EVENTS
On 2 February 2009 Avisen Plc (formerly Z Group plc) acquired Avisen Group Limited.
10. DIVIDENDS
The directors are unable to recommend the payment of a dividend.
11. COPIES OF THE REPORT & ACCOUNTS
Copies of the Report and Accounts have been posted to shareholders, are available from the Company's registered office 16 Devonshire Street, London W1G 7AF and are available from the Company's website www.avisenplc.com.