REG - Arcontech Group PLC - Final Results <Origin Href="QuoteRef">ARC.L</Origin>

ArcontechAnnouncement

29/10/2014 13:24

RNS Number : 3214P
Arcontech Group PLC
18 August 2014
Arcontech Group plc
("Arcontech", the "Company" or the "Group")
Final Results for the Year Ended 30 June 2014 
Chairman's Statement
Arcontech has achieved a significantly improved operating result for the year ended 30 June 2014, with a loss before taxation and exceptional items of 35,565 (2013: loss before taxation and exceptional items of 340,750). After taking the benefit of the Research and Development tax credit of 100,251 (2013: 88,905) which the company receives due to the amount it has invested in qualifying product design and development, Arcontech achieved a profit after tax of 64,686 (2013: loss after tax of 251,845).
Turnover for the year was 1,981,375 (2013: 1,830,717), an increase of 8%. This increase, whilst positive, is lower than we would have hopedto achieve due in part to the continued lengthening of sales cycles and to customers prioritising areas subject to greater regulatory focus than those addressed by our products. However, at 30 June 2014 the annual recurring licence fees amounted to 1,985,355(2013: 1,884,778) representing 98% of our annualised running costs (2013: 87%).
As a result of negative distributable reserves, Arcontech has not been able to declare a dividend (2013:Nil). We intend, however, when the company moves into sustainable profitability, to seek court approval to re-designate our reserves and thereby enable the company to pay dividends.
Financing 
As at 30 June 2014 Arcontech had no debt and cash balances of 733,676 (2013: 878,804), this reduction being due to the timing of sales invoicing and of cash receipts from customers. Nevertheless, the company remains well financed.
Employees 
Our employees are core to our business. They have responded positively to the challenges presented by a competitive market place during the last financial year and weagainthank them for their continued hard work, dedication and support.
Outlook
With Arcontech's lower cost base and improved product offering we believe that the company is well placed to continue to grow its revenues. The level of sales prospects the company has are significant, however the timing oftheir conversioninto actual sales orders is, as in previous years, extremely difficult to predict. We remain convinced that opportunities for the sale of our products to international investment banks, central banks and other financial institutions remain strong.
Richard Last 
Chairman 
Chief Executive's Review
During the year we have continued to work on positioning the business so that we have a solid, efficient and effective platform from which to grow. At the same time we have worked with our existing clients to strengthen and grow our relationships whilst also prospecting for new opportunities. In both areas we have succeeded and are now well positioned to move forward.
We have managed to reduce costs in running the organisation so that it is efficient and productive with all areas complementing each other in our goal for growth. We implemented stricter controls on development to ensure work undertaken generated revenue and contributed to making our offerings more competitive.We also improved the way in which we test our software by building out automated processes where possible, which although requiring human input at the scripting phase does not require subsequent repetitive and costly human intervention.
Growing the business has been successful too, in a very challenging market. Ongoing issues in the marketplace such as the LIBOR-fixing scandal and staff reductions have served to prolong decision making. Despite this we managed to grow revenues by 8% and we are pleased to say we believe Excelerator to be the leading Excel Add-In in the financial market-place with one client having rolled out more than 300 positions across the organisation. We are also happy to have secured the world's oldest international financial organisation as a new MVCS client. 
More generally we have also expanded our discussions with clients to identify additional areas in which we can add value to embed us further within their businesses and to aid development of our product portfolio. At the same time we have continued to improve our marketing function which,together with our overall business and sales strategy, increasingly addresses issues of regulation and compliance. 
As we build on what has been done and develop these areas I look forward to achieving greater progress. 
Matthew Jeffs
Chief Executive
For further information please visit www.arcontech.com
Enquiries
Arcontech Group plc
Matthew Jeffs, CEO
+44 20 7256 2300
Northland Capital Partners Limited
Matthew Johnson / Lauren Kettle
+44 20 7382 1100
Group Income Statement and Statement of Comprehensive Income
For the year ended 30 June 2014
Note
2014
Before
exceptional items
2013
Exceptional items
2013
Total 2013
Revenue
2
1,981,375
1,830,717
-
1,830,717
Distribution costs
(31,439)
(28,468)
-
(28,468)
Administrative costs
(1,989,156)
(2,150,126)
(160,994)
(2,311,120)
Operating loss
3
(39,220)
(347,877)
 (160,994)
(508,871)
Finance income
3,655
7,127
-
7,127
Loss before taxation
(35,565)
(340,750)
(160,994)
(501,744)
Taxation
100,251
88,905
-
88,905
Profit/(loss) for the year after tax
64,686
(251,845)
(160,994)
(412,839)
Total comprehensive income for the year
64,686
(251,845)
(160,994)
(412,839)
Profit/(loss) per share (basic and diluted)
4
0.004p
(0.027)p
All of the results relate to continuing operations.
Statement of Changes in Equity
For the year ended 30 June 2014
Group:
Share
capital
Share
premium
Share option reserve
Retained
earnings
Total
equity
Balance at 30 June 2012
1,531,315
9,428,169
190,760
(9,473,857)
1,676,387
Loss for the year
-
-
-
(412,839)
(412,839)
Total comprehensive income for the year 
-
-
-
(412,839)
(412,839)
Share-based payments
-
-
62,474
-
62,474
Balance at 30 June 2013
1,531,315
9,428,169
253,234
(9,886,696)
1,326,022
Profit for the year
-
-
-
64,686
64,686
Total comprehensive income for the year
-
-
-
64,686
64,686
Issue of shares
 5,357
2,143
-
-
7,500
Share-based payments
 -
-
18,677
-
18,677
Share-based payments provision released
 -
-
(199,349)
199,349
-
Balance at 30 June 2014
1,536,672
9,430,312
72,562
(9,622,661)
1,416,885
Company:
Share
capital
Share
premium
Share option reserve
Retained
earnings
Total
equity
Balance at 30 June 2012
1,531,315
9,428,169
190,760
(7,565,688)
3,584,556
Loss for the year
-
-
-
(189,820)
(189.820)
Total comprehensive income for the year
-
-
-
(189,820)
(189.820)
Share-based payments
-
-
62,474
-
62,474
Balance at 30 June 2013
1,531,315
9,428,169
253,234
(7,755,508)
3,457,210
Profit for the year
-
-
-
23,186
23,186
Total comprehensive income for the year
-
-
-
23,186
23,186
Issue of shares
 5,357
2,143
-
-
7,500
Share-based payments
-
-
18,677
-
18,677
Share-based payments provision released
 -
-
(199,349)
53,091
(146,258)
Balance as at 30 June 2014
1,536,672
9,430,312
72,562
(7,679,231)
3,360,315
Balance Sheets
As at 30 June 2014
Group
2014
Group
2013
Company
2014
Company
2013
Non-current assets
Goodwill
1,715,153
1,715,153
-
-
Property, plant and equipment
19,112
25,044
-
-
Investments in subsidiaries
-
-
2,017,373
2,017,373
Total non-current assets
1,734,265
1,740,197
2,017,373
2,017,373
Current assets
Trade and other receivables
361,016
591,780
1,510,725
1,648,084
Cash and cash equivalents
733,676
878,804
37,854
54,817
Total current assets
1,094,692
1,470,584
1,548,579
1,702,901
Current liabilities

















Trade and other payables

(1,412,072)

(1,884,759)

(205,637)

(263,064)
Total current liabilities

(1,412,072)

(1,884,759)

(205,637)

(263,064)


Net current (liabilities)/assets

(317,380)
(414,175)
1,342,942
1,439,837


Net assets
1,416,885
1,326,022
3,360,315
3,457,210
Equity
Called up share capital
1,536,672
1,531,315
1,536,672
 1,531,315
Share premium account
9,430,312
9,428,169
9,430,312
 9,428,169
Share option reserve
72,562
253,234
 72,562
 253,234
Retained earnings
(9,622,661)
(9,886,696)
(7,679,231)
(7,755,508)
 1,416,885

 1,326,022
3,360,315
 3,457,210
Approved on behalf of the board on 15 August 2014 by:
Matthew Jeffs
Michael Levy
Chief Executive
Group Finance Director
Group Cash Flow Statement
For the year ended 30 June 2014
Note
2014
2013
Net cash ( used in)/generated from operating activities
(151,013)
130,081
Investing activities
Interest received
3,655
7,127
Purchases of plant and equipment
(5,270)
(5,079)
Issue of shares
7,500
-
Net cash generated frominvesting activities
5,885
2,048
Net (decrease)/increase in cash and cash equivalents
(145,128)
132,129
Cash and cash equivalents at beginning of year
878,804
746,675
Cash and cash equivalents at end of year
733,676
878,804
Company Cash Flow Statement
For the year ended 30 June 2014
2014
2013
Net cash (used in)/generated from operating activities
(24,652)
16,915
Investing activities
Interest received
189
307
Issue of shares
7,500
-
Net cash generated frominvesting activities
7,689
307
Net (decrease)/increase in cash and cash equivalents
(16,963)
17,222
Cash and cash equivalents at beginning of year
54,817
37,595
Cash and cash equivalents at end of year
37,854
54,817
Notes to the Financial Statements
For the year ended 30 June 2014
1.  Accounting policies
Theprincipalaccountingpoliciesaresummarisedbelow. Theyhaveallbeenapplied consistently throughout the period covered bythesefinancial statements.
Reporting entity
Arcontech Group PLC ("the Company") is a company incorporated in the United Kingdom. The consolidated financial statements incorporate the financial statements of the Company and its subsidiaries (together referred to as "the Group").
Basis ofpreparation
The financial information set out above for the years ended 30 June 2014 and 2013 does not constitute the Group's statutory accounts within the meaning of Section 434 of the Companies Act 2006 but is derived from those accounts. Statutory accounts for the year ended 30 June 2013 have been delivered to the Registrar of Companies and those for 2014 will be delivered following the Company's annual general meeting. The auditors have reported on those accounts. The auditors' reports were unqualified and did not contain statements under s.498 (2) or (3) Companies Act 2006. The results have been prepared using accounting policies consistent with those used in the preparation of the statutory accounts. 
The financial statements havebeenpreparedinaccordancewithInternationalFinancial Reporting Standards ("IFRS") endorsed by the European Union and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS.
Thefinancialstatementshavebeenpreparedunderthehistorical cost convention.
2. Revenue
An analysis of the Group's revenue is as follows:
2014
2013
Financial information service, advertising and sponsorship, software development and consultancy
1,981,375
1,830,717
All of the Group's revenue relates to continuing activities.
 
3. Operating loss for the year is stated after charging:
2014
2013
Depreciation of plant and equipment
10,736
13,951
Loss on disposal of fixed assets
465
346
Staff costs
1,476,944
1,645,544
Operating lease rentals - land and buildings
79,000
79,000
Research and development
736,867
729,095
4. Loss per share
2014
2013
Earnings
Earnings for the purpose of basic and diluted earnings per share being net profit/(loss) attributable to equity shareholders
64,686
(412,839)
64,686
(412,839)
No.
No.
Number of shares
Weighted average number of ordinary shares for the purpose of basic earnings per share
1,531,505,672
1,531,314,870
Number of dilutive shares under option
13,314,419
-
Weighted average number of ordinary shares for the purposes of dilutive earnings per share
1,544,820,092
1,531,314,870
The calculation of diluted earningsper share assumesconversionof all potentiallydilutive ordinary shares, allof which arise fromshareoptions. A calculationisdonetodeterminethenumberofsharesthat couldhavebeen acquired at fair value, based uponthemonetaryvalue ofthesubscription rightsattachedto outstandingshareoptions.
5. Dividends
There were no dividends paid or proposed during the period (2013: Nil).
6. Post balance sheet events
There were no events since the balance sheet date, which materially affect the position of the Group.
7. Annual General Meeting 
 The annual general meeting of the "Company" will be held at the Company's offices, 8th Floor, Finsbury Tower, 103-105 Bunhill Row, London EC1Y 8LZ on 29 October 2014 at 10 a.m.
8. Annual report and accounts
Copies of the annual report and accounts will be sent to shareholders in due course and will be available from the Company Secretary at the Company's registered office at 8th Floor Finsbury Tower, 103-105 Bunhill Row, London, EC1Y 8LZ or from the Company's website at www.arcontech.com.

This information is provided by RNS
The company news service from the London Stock Exchange
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