Touchstar Plc Regulatory News (TST)

24 Feb 2005 07:00

Belgravium Technologies PLC24 February 2005 24 February 2005 BELGRAVIUM TECHNOLOGIES PLC (BVM:AIM) PRELIMINARY RESULTS FOR THE YEAR ENDED TO DECEMBER 31 2004 The Board of Belgravium Technologies plc ("Belgravium" or "the Company"),designers and manufacturers of real-time data capture systems, are pleased toannounce the Preliminary Results for the year ended 31 December 2004. HIGHLIGHTS • Turnover £3,859,000 (2003: £3,895,000) • Cash in bank up 9% £2,219,000 (2003: £2,043,000) • Total dividends for year increased 0.45p (2003: 0.42p) • Pre tax profits £751,000 (2003: £795,000) • Basic earnings per share increased 0.90p (2003: 0.85p) Commenting today, Chief Executive John Kembery said: "2004 was a year of solid achievement. The Company finished the year betterpositioned, both technically and commercially, to take on the challenges of anevolving market. Belgravium's great strength is the quality of its goods and services and itsability to respond to customers' needs. In the 2004 interim report, we notedchanges in the market place, particularly customers wanting a greater breath ofservices. We see the present market as an opportunity and have further improvedour organisation to respond. With this approach we have proved that we can rival bigger suppliers and closed2004 with the biggest order ever secured by Belgravium; a £750,000 system tocontrol Grattan's Parcelnet division. We are seeking more orders of this typeand have set up our sales and technical organisation to achieve this aim. We start 2005 with a good order book, with an encouraging range of prospects andmore ability to serve market needs than ever before. Provided the marketstrength holds, it should be a better year and one in which we can build on thefoundations securely laid in previous years." For further information please contact: Buchanan Communications ltdKelly-Ann French Mob: 07958 972164Alastair Watson 0207 466 5000 Belgravium Technologies plcJohn Kembery Mob: 07770 731021 www.belgraviuminvestorrelations.com Chairman's Statement Introduction Belgravium Technologies designs and manufacturers real time electronic datacapture systems, which are largely applied to the logistics and supply chainsectors in the UK and Europe. Results 2004 was a year of solid achievement. The company finished the year betterpositioned, both technically and commercially, to take on the challenges of anevolving market. Turnover for the year was very similar to 2003 at £3,859,000 (2003: £3,895,000).Profit before tax at £751,000 was in line with expectation and would have beenalmost exactly the same as the previous year (2003: £795,000) had it not beenfor the costs of a failed acquisition. The tax charge for 2004 was lower than 2003, due to credits arising fromprevious years. As a result, earnings were higher than the previous year at£603,000 (2003: £577,000) and basic earnings per ordinary share went up to 0.90pper share (2003: 0.85p). Balance sheet Once again the Group has continued to accumulate cash. At the end of 2004 cashin hand totalled £2,219,000, a 9% increase on the previous year (2003:£2,043,000). In 2003 the company sold a property generating £281,000 and withoutthis bonus the continued cash accumulation in 2004 is very satisfactory andleaves the Group balance sheet in a very strong position to finance futuregrowth. Dividend Consistent with our policy of improving dividends wherever possible, the Boardis pleased to recommend a final dividend of 0.32p per ordinary share. This willbe paid on 26 May, subject to the approval at the AGM of shareholders on theregister at 29 April 2005. This will provide total dividends paid and proposedin the year of 0.45p per ordinary share compared to 0.42p per ordinary share in2003. The market In the 2004 interim report we noted changes in the market place, particularlycustomers wanting a greater breadth of services. This trend has continued andcombined with the caution on IT spend which has been evident for some years, hasproduced a difficult market to supply with standard products. Belgravium's great strength is the quality of its goods and services and itsability to respond to customers' needs. We see the present market as anopportunity and have further improved our organisation to respond. For 2005 wehave strengthened the sales team with particular emphasis on Europe and haveincreased marketing spend and technical support. With this approach we haveproved that we can rival bigger suppliers and closed 2004 with the biggest orderever secured by Belgravium; a £750,000 system to control Grattan's Parcelnetdivision's Proof of Delivery requirements. We are seeking more orders of thistype and have set up our sales and technical organisation to achieve this aim. Operations During 2004 the operational team was reorganised to blend technical developmentwith manufacturing and to increase emphasis on forward technical planning. Themarket is becoming more demanding and sophisticated and we need to respond in acost effective manner, making sure that we have the right product at the righttime. So far this plan has worked well and is part of the reason why we feelbetter equipped to meet further challenges. Also noteworthy is the way in whichcosts have been controlled in 2004, again a by-product of improved planning. Acquisitions Belgravium has consistently tried to increase turnover by organic means and,whilst we still expect this type of growth, a big step forward could be achievedby an acquisition with real synergy. Since research and development costs arecomparatively high in a technical business, this would have the effect of makingmore solutions economically available. Over the past three years we have looked at a great many businesses but usuallyfailed to find real synergy. In 2004 we thought we have found the right deal,only to have the vendor change his mind after we had incurred costs. This disappointing experience has not altered our view that an acquisition wouldbe of benefit to the business and its shareholders and we are currentlyexamining some interesting prospects. We shall not however make any commitmentsunless we are convinced that any given acquisition will enhance Belgravium'searnings per share. Product development In 2004 Belgravium added extra skills to the technical team and continued tospend significant amounts on increasing the range and capabilities of itsproducts, consistent with market needs. Future technical developments such asRadio Frequency Identification (RFID) offer the possibility of expanding ourmarket and are being pursued vigorously. We have already supplied a pilot systemutilising this technology within our Atlanta hand held product. This is provingsuccessful and we expect to supply the complete order later in the year. Employees A business built on flexibility and service depends a good deal on the goodwilland, often good humour, of its staff. This has been no different from any otheryear in its demands and the whole company has responded brilliantly. Outlook The second half of 2004 was a little disappointing because we had factored intoour forecasts an order from Grattan which, in the event, was larger thananticipated but mostly spread through 2005. Thus we start 2005 with a good orderbook, with an encouraging range of prospects and more ability to serve marketneeds than ever before. Provided the market strength holds it should be a betteryear and one in which we can build on the foundations securely laid in previousyears. J P KemberyExecutive Chairman Audited Group profit and loss account for the year ended 31 December 2004 2004 2003 £'000 £'000 Turnover 3,859 3,895Cost of sales 1,369 1,367Gross profit 2,490 2,528Distribution costs 31 34Administrative expenses 1,800 1,812 1,831 1,846Operating profit 659 682Profit on sale of property held for resale - 56Profit on ordinary activities before interest and taxation 659 738Interest receivable 92 57Profit on ordinary activities before taxation 751 795Tax charge on profit on ordinary activities (148) (218)Profit on ordinary activities after taxation 603 577Ordinary dividend (301) (283)Profit retained for the year 302 294Basic earnings per ordinary share 0.90p 0.85pDiluted earnings per ordinary share 0.89p 0.84p All activities in the years above relate to continuing operations. There are no recognised gains or losses other than the profit for the year andtherefore no separate statement of total recognised gains and losses has beenpresented. There is no difference between the profit on ordinary activities before taxationand the retained profit for the year as stated above, and their historical costequivalents. Audited Group balance sheet as at 31 December 2004 2004 2003 £'000 £'000Fixed assetsTangible assets 237 294Current assetsStocks 443 443Debtors 1,458 1,232Cash at bank and in hand 2,219 2,043 4,120 3,718Creditors: amounts falling due within one year (1,871) (1,691)Net current assets 2,249 2,027Total assets less current liabilities 2,486 2,321Provisions for liabilities and charges (54) (70)Net assets 2,432 2,251Capital and reservesCalled up share capital 3,341 3,391Share premium account 120 120Capital redemption reserve 2,100 2,050Profit and loss account (3,129) (3,310)Total equity shareholders' funds 2,432 2,251 Audited Group cash flow statement for the year ended 31 December 2004 2004 2003 £'000 £'000 Net cash inflow from operating activities 672 1,033Returns on investment and servicing of financeInterest received 92 57 92 57TaxationCorporation tax paid (180) (260)Corporation tax received 55 - (125) (260)Capital expenditure and financial investmentPurchase of tangible fixed assets (51) (50)Proceeds from disposal of property held for resale - 281 (51) 231Equity dividends paid to shareholders (291) (244)Net cash inflow before financing 297 817FinancingPurchase of own ordinary share capital (121) (116) (121) (116)Increase in cash in the year 176 701 Audited reconciliation of net cash flow to movement in net funds 2004 2003 £'000 £'000 Increase in cash 176 701Movement in net funds during year 176 701Net funds at 1 January 2,043 1,342Net funds at 31 December 2,219 2,043 Audited reconciliation of operating profit to net cash inflow from operatingactivities: 2004 2003 £'000 £'000 Operating profit 659 682Depreciation 108 81Movement in provisions (16) (17)Funds generated by operations 751 746Decrease in stocks - 47Increase in debtors (239) (186)Increase in creditors 160 426(Increase)/decrease in working capital (79) 287Net cash inflow from operating activities 672 1,033 Audited reconciliation of movements in Group equity shareholders' funds 2004 2003 £'000 £'000 Profit on ordinary activities after taxation 603 577Dividends (301) (283) 302 294Purchase of own ordinary share capital (121) (116)Net change in equity shareholders' funds 181 178Opening equity shareholders' funds 2,251 2,073Closing equity shareholders' funds 2,432 2,251 Basis of reporting This preliminary announcement, which has been prepared on a basis consistentwith the previous year, does not constitute statutory accounts within themeaning of Section 240 of the Companies Act 1985. This preliminary announcement contains information extracted from the auditedfinancial statements of the group for the year ended 31 December 2004. Thestatutory accounts for the year ended 31 December 2004 will be sent to theshareholders shortly. The information for the year ended 31 December 2003 is an extract from thestatutory accounts to that date which have been delivered to the Registrar ofCompanies. These accounts included an audited report which was unqualified andwhich did not contain a statement under Section 237(2) or (3) of the CompaniesAct 1985. -ENDS- This information is provided by RNS The company news service from the London Stock Exchange