Touchstar Plc Regulatory News (TST)

Belgravium Technologies plc

Preliminary results for the

year ended 31 December 2012

The Board of Belgravium Technologies plc ((AIM:BVM) 'Belgravium' or 'The Group')), designers and suppliers of computing solutions and services for mobile data capture applications to a wide variety of industrial sectors, is pleased to announce its preliminary results for the year ended 31 December 2012.

Financial Highlights:

- Results in line with revised market expectations

- Revenues of £8,669,000 (2011: £11,157,000)

- Profit after tax of £336,000 (2011: £876,000)

- Proposed maintained dividend of 0.1p (2011: 0.1p)

- Strong cash flows and net cash position of £1,566,000 (2011; £1,074,000).

- EPS of 0.33p (2011: 0.87p)

Commenting today, John Kembery, Executive Chairman of Belgravium, said: "After a successful 2011 which benefited from some large contracts, 2012 has proved a challenging year. Nevertheless, I am pleased to report that our results are in line with revised expectations. Our operational gearing means that we are sensitive to falls in revenue and in common with many companies, Belgravium has found it difficult to convert its sales pipeline into confirmed orders as customers continue to delay their investment decisions. We do not expect our markets to change significantly in 2013. However, the Group has a strong balance sheet and has initiatives in place which should ensure improved profitability in the current year"

More information on Belgravium Technologies plc can be seen at www.belgravium-technologies.com

CHAIRMAN'S STATEMENT 2012

After a successful 2011 which benefited from some large contracts, 2012 has proved a challenging year. Nevertheless, I am pleased to report that our results are in line with revised expectations. Our operational gearing means that we are sensitive to falls in revenue and in common with many companies, Belgravium has found it difficult to convert its sales pipeline into confirmed orders as customers continue to delay their investment decisions.

Revenues for the year were £8,669,000 compared to £11,157,000 in 2011. As a result, profit before tax was £282,000 compared with £1,024,000 in the previous year. Due to our continued investment in research and development however, no tax will be payable in the year and there is a tax credit release of £54,000 (2011; charge of £148,000). Earnings per ordinary share therefore were 0.33p per share compared to 0.87p per share in 2011.

BALANCE SHEET

The Group's balance sheet remains strong and debt free. At the year end net cash was £1,566,000 (2011; £1,074,000). Cash generation has continued strongly with a 45% increase in net cash over the 2011 year end.

DIVIDEND

Whilst the Board believes it is important to maintain cash reserves for development and investment projects, it is also committed to maintaining the payment of dividends, a policy restored in the previous year. Subject to shareholder's approval at the AGM, it is therefore the Board's intention to pay a maintained dividend of 0.10 pence per ordinary share on 18 June 2013 to shareholders on the register on 24 May 2013. The 'ex' dividend date will be 22 May 2013.

THE MARKET

Belgravium supplies and manages a wide range of mobile computing services and solutions with a focus on the logistics, transportation and mobile retailing sectors. Such projects tend to be classed as capital spend by the majority of our customers and, since 2007, have been subject to a marked reluctance by customers to commit funds, even when there are immediate operational advantages. The ongoing issue is that, however small the project, it is subject to the most frustrating re-designs, re-appraisals and delays all caused by general financial restraint. In 2011, we were successful in winning major contracts for British Airways and Hermes and this lifted revenues significantly above the norm for recent years. It was, therefore, tempting to believe that the market had changed but, as we said in last year's report, there was limited evidence that financial confidence would remain in 2012 given the general economic climate. At the time of the interim results it was clear that 2012 was going to be difficult but it was only toward the end of the final quarter that it became clear that the stronger second half of the year that we usually experience would not materialise. It was then that we started to implement initiatives aimed at reducing costs, improving profitability and restoring long term growth.

OPERATIONAL REPORT

Historically, Belgravium has been described as an electronic hardware company. In recent years we have worked hard on the strategic conversion to a system provider, in which the completeness of the solution was essential. This strategy has provided some differentiation from the price competitive nature of hardware sales and is responsible for the rise of repeat revenues and cash generation. 2012 saw further development of this strategic approach:

(1) By expanding our sales offering, we have increasingly moved into telematics and vehicle tracking using specialist partners and this gives customers better fleet control and data on the performance of employees and their vehicles. A major UK fuel retailer has recently implemented our system for the tracking of vehicles and driver behaviour data.

(2) We have taken the expertise we have gained in the specialist fuel delivery market and successfully applied them to solutions in general logistics. For example, at Hermes where 'in cab' technology is used in 300 vehicles and more recently we have supplied several transport companies with mobile devices for their HGV fleets.

(3) We have expanded our sales efforts into additional countries. In South Africa where we have recently installed an aircraft re-fuelling system at Johannesburg's OR Tambo Airport. In Japan we are working with a local and experienced distribution company, to establish a channel partnership for the future development of this region. In Austria we have established a working partnership with a Vienna based company with the objective of developing sales into Eastern Europe.

(4) We continued to invest significantly in the development of hardware and software to respond to the customers changing requirements. For example. We have introduced an upgraded 'Boston 2' and an all new truck mounted product, the 'Vienna'. Further plans include schemes to reduce the component cost of hardware which will have a positive impact on the cost of sales.

COST CONTROL

In budgeting for 2013 we have assumed that economic conditions will not improve in the short term and that profit gains in the year will have to come from new initiatives and a lower cost base. To this end we have cut out expenditure that is not deemed to be essential to recovery and made a small reduction in numbers employed, including cutting down the size and cost of the Board and overheads. We are especially grateful to Roddy McDougall in this regard for voluntarily retiring after 14 years of valuable service and to Chris Phillips for reducing his role to that of a non-executive director and Company Secretary.

ACQUISTION CRITERIA

This year's downturn in Belgravium's performance is very different from 2010 when we had a demanding bank debt. Our cash generative policies have allowed that debt to be repaid in full and left a healthy surplus for future corporate development. Whilst we aim to increase sales organically, now that we have the resources, it is right that we also seek further growth by acquisition.

We are examining two areas:

Increased territorial coverage. We have long felt that our products and services could be sold into more countries, particularly in Europe. So far, sales have been restrained by the perceived need to have local representation, installation and maintenance arrangements. Certainly where we have such facilities, as in France, good business has resulted. We are therefore pursuing the development of relationships where we can extend territorial coverage.

New market sector. Belgravium will continue to be focused on digital data capture but there are other markets to which this can apply outside of logistics and where our hardware and software expertise would provide immediate benefits. In 2013, we shall attempt to find such a company and to use some of our cash reserves to build a growth relationship.

EMPLOYEES

Belgravium has been operating in demanding market conditions for some years and it has been necessary to review staffing levels on several occasions. The result of this process is that we have a highly proficient and flexible workforce well used to responding to frequent changes of demand. In the case of Belgravium, personnel are certainly our most valuable asset and I would like to thank them for their hard work and commitment.

OUTLOOK

2012 was a challenging year and we do not expect our markets to change significantly in 2013. However, the Group has a strong balance sheet and has initiatives in place which should at least ensure improved profitability in the current year.

J P Kembery

Executive Chairman

5 March 2013

Audited consolidated income statement for the year ended 31 December 2012

Audited consolidated statement of changes in equity for the year ended 31 December 2012

Audited consolidated balance sheet as at 31 December 2012

Audited consolidated cash flow statement for the year ended 31 December 2012

1. General information

Belgravium Technologies plc is a public company limited by share capital incorporated and domiciled in the United Kingdom. The Company has its listing on the Alternative Investment Market. The address of its registered office is 1 George Square, Glasgow, G2 1AL.

2. Basis of preparation

The financial information set out in this document does not constitute the Group financial statements for the year ended 31 December 2012 or 31 December 2011. The annual report and financial statements for the year ended 31 December 2012 were approved by the Board of Directors on 5 March 2013 along with this preliminary announcement, but have not yet been delivered to the Registrar of Companies.

The auditors' report on the financial statements for the year ended 31 December 2012 was unqualified and did not contain a statement under section 498 of the Companies Act 2006.

The audited consolidated financial statements from which these results are extracted have been prepared under the historical cost convention and in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union, IFRIC interpretations and those parts of the Companies Act 2006 applicable to companies reporting under IFRS.

The accounting policies set out below represent an extract of the policies set out in the consolidated financial statements. There have been no changes in accounting policies in the year.

3. Critical accounting estimates and assumptions

The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

(a) Estimated impairment of goodwill

The Group tests annually whether goodwill has suffered any impairment, in accordance with the accounting policy stated above. The recoverable amounts of cash-generating units have been determined based on value-in-use calculations. These calculations require the use of estimates, both in arriving at the expected future cash flows and the application of a suitable discount rate in order to calculate the present value of these flows.

 (b) Development expenditure

The Group recognises costs incurred on development projects as an intangible asset which satisfy the requirements of IAS 38. The calculation of the costs incurred includes the percentage of time spent by certain employees on the development project. The decision whether to capitalise and how to determine the period of economic benefit of a development project requires an assessment of the commercial viability of the project and the prospect of selling the project to new or existing customers.

4. Audited reconciliation of net funds

5. Earnings per share

Basic earnings per share is calculated by dividing the earnings attributable to ordinary shareholders by the weighted average number of ordinary shares in issue during the year.

For diluted earnings per share, the weighted average number of ordinary shares in issue is adjusted to assume conversion of all dilutive ordinary shares. The dilutive ordinary shares represent the share options and warrants granted to employees where the exercise price is less than the average market price of the Company's ordinary shares during the year.

Reconciliations of the earnings and weighted average number of shares used in the calculation are set out below: