415p 1.0 0.2%
Last Trade - 05/03/21
Market Cap | £121.7m |
Enterprise Value | £119.5m |
Revenue | £20.8m |
Position in Universe | 958th / 1807 |
- Part 2: For the preceding part double click ID:nRSb2323Qa Gross profit 6,102,075 - Administrative expenses (4,209,334) - Depreciation and amortisation (714,250) - Operating profit before exceptional items - all from acquisition 1,178,491 - (746,055) Exceptional item - IPO costs (580,500) Operating profit/(loss) 4 432,436 (580,500) Finance income 6 6,059 - Finance costs 7 (199,559) - Profit/(loss) before taxation 238,936 (580,500) Taxation 8 68,032 - Profit/(loss) for the year/period 306,968 (580,500) Other comprehensive income Exchange difference on translating foreign 145,913 - operations Total comprehensive profit/(loss) for the year/period 452,881 (580,500) Earnings/(loss) per share Basic and diluted earnings/(loss) per share - continuing and total operations 11 1.3 pence (4.9) pence All transactions are attributable to the owners of the parent. The group has no other recognised gains or losses for the current year. * Comprises the plc Parent Company only, as the Group came into existence on 18 March 2016. Consolidated Statement of Financial Position Group As at 30 September 2016 As at 30 September 2015* Notes £ £ ASSETS Non-current assets Goodwill 12 2,053,141 - Intangible assets 12 6,979,370 - Property, plant and equipment 13 411,505 - Deferred tax assets 15 320,546 - 9,764,562 - Current assets Trade and other receivables 16 9,164,872 44,523 Cash and cash equivalents 5,006,185 14,841 14,171,057 59,364 TOTAL ASSETS 23,935,619 59,364 LIABILITIES Non-current liabilities Borrowings 19 (3,572,602) - Other payables 18 (120,000) - Deferred tax liabilities 15 (1,280,805) - (4,973,407) - Current liabilities Trade and other payables 17 (5,007,214) (624,204) Borrowings 17 (1,000,000) - (6,007,214) (624,204) TOTAL LIABILITIES (10,980,621) (624,204) NET ASSETS/ (LIABILITIES) 12,954,998 (564,840) EQUITY ATTRIBUTABLE TO SHAREHOLDERS Share capital 22 147,567 15,660 Share premium account 13,318,725 - Foreign exchange reserve 145,913 - Retained loss (657,207) (580,500) TOTAL EQUITY 12,954,998 (564,840) The financial statements were approved and authorised for issue by the Board of Directors on 25 November 2016. Signed on behalf of the Board of Directors by: L T Hall - Director Company Number 09472870 The accompanying accounting policies and notes form an integral part of these financial statements. * Comprises the plc Parent Company only, as the Group came into existence on 18 March 2016. Company Statement for Financial Position Company As at 30 September 2016 As at 30 September 2015 Notes £ £ ASSETS Non-current assets Investments in subsidiaries 14 14,651,571 - 14,651,571 - Current assets Trade and other receivables 16 57,490 44,523 Cash and cash equivalents 3,457,157 14,841 3,514,647 59,364 TOTAL ASSETS 18,166,218 59,364 LIABILITIES Non-current liabilities Borrowings 19 (3,572,602) - (3,572,602) - Current liabilities Trade and other payables 17 (72,146) (624,204) Borrowings 17 (1,000,000) - (1,072,146) (624,204) TOTAL LIABILITIES (4,644,748) (624,204) NET ASSETS/ (LIABILITIES) 13,521,470 (564,840) EQUITY ATTRIBUTABLE TO SHAREHOLDERS Share capital 22 147,567 15,660 Share premium account 13,318,725 - Retained profit/(loss) 55,178 (580,500) TOTAL EQUITY 13,521,470 (564,840) The financial statements were approved and authorised for issue by the Board of Directors on 25 November 2016. Signed on behalf of the Board of Directors by: L T Hall - Director Company Number 09472870 The accompanying accounting policies and notes form an integral part of these financial statements. Consolidated Statement of Cashflows Group Year to 30 September 2016 Period from 5 March 2015 to 30 September 2015* Notes £ £ Cash flows from operating activities Profit/(loss) for the year/period 306,968 (580,500) Adjustments for: Taxation (68,032) - Finance income (6,059) - Finance costs 199,559 - Depreciation 142,695 - Amortisation 571,555 - 1,146,686 (580,500) Increase in trade and other receivables (1,765,866) (44,523) (Decrease)/increase in trade and other payables (101,524) 624,204 Cash used in operations (720,704) (819) Finance costs (72,981) - Finance income 6,059 - Tax paid (30,511) - NET CASH USED IN OPERATING ACTIVITIES (818,137) (819) Cash flows from investing activities Acquisition of subsidiary undertakings, net of cash and overdrafts acquired 2 (11,129,200) - Capitalisation of development costs (601,111) - Purchase of property, plant and equipment (136,993) - NET CASH USED IN INVESTING ACTIVITIES (11,867,304) - Cash flows from financing activities Proceeds from issue of equity shares 13,450,632 15,660 Borrowings repaid (427,398) - Borrowings received 5,000,000 - Dividends paid (383,675) - NET CASH GENERATED FROM FINANCING ACTIVITIES 17,639,559 15,660 NET INCREASE IN CASH AND CASH EQUIVALENTS 4,954,118 14,841 Translation differences 37,226 - Cash and cash equivalents at beginning of year/period 14,841 - CASH AND CASH EQUIVALENTS AT END OF YEAR/PERIOD 5,006,185 14,841 The accompanying accounting policies and notes form an integral part of these financial statements. * Comprises the plc Parent Company only, as the Group came into existence on 18 March 2016. Company Statement of Cash Flows Company Year to 30 September 2016 Period from 5 March 2015 to 30 September 2015 Notes £ £ Cash flows from operating activities Profit/(loss) for the year/period 1,019,353 (580,500) Adjustments for: Finance costs 77,770 - 1,097,123 (580,500) Increase in trade and other receivables (12,967) (44,523) (Decrease)/increase in trade and other payables (557,226) 624,204 Cash generated from/(used in) operations 526,930 (819) Finance costs (72,602) - NET CASH GENERATED FROM/(USED IN) OPERATING ACTIVITIES 454,328 (819) Cash flows from investing activities Acquisition of subsidiary undertakings 2 (14,651,571) - NET CASH USED IN INVESTING ACTIVITIES (14,651,571) - Cash flows from financing activities Proceeds from issue of equity shares 13,450,632 15,660 Borrowings repaid (427,398) - Borrowings received 5,000,000 - Dividends paid (383,675) - NET CASH GENERATED FROM FINANCING ACTIVITIES 17,639,559 15,660 NET INCREASE IN CASH AND CASH EQUIVALENTS 3,442,316 14,841 Cash and cash equivalents at beginning of year/period 14,841 - CASH AND CASH EQUIVALENTS AT END OF YEAR/PERIOD 3,457,157 14,841 Consolidated Statement of changes in Equity Group Ordinary share capital Share premium Foreign exchange reserve Retained Earnings Total £ £ £ £ £ Balance at 5 March 2015 - - - - - Loss for the period - - - (580,500) (580,500) Total comprehensive income* - - - (580,500) (580,500) Transactions with owners: Issue of shares on incorporation 15,660 - - - 15,660 Balance as at 30 September 2015* 15,660 - - (580,500) (564,840) Ordinary share capital Share premium Foreign exchange reserve Retained Earnings Total £ £ £ £ £ Balance at 1 October 2015 15,660 - - (580,500) (564,840) Profit for the year - - - 306,968 306,968 Other comprehensive income: Exchange differences on translating foreign operations - - 145,913 - 145,913 Total comprehensive income - - 145,913 306,968 452,881 Transactions with owners: Issue of shares 131,907 13,318,725 - - 13,450,632 Dividends - - - (383,675) (383,675) Total transactions with owners 131,907 13,318,725 - (383,675) 13,066,957 Balance as at 30 September 2016 147,567 13,318,725 145,913 (657,207) 12,954,998 Company Statement of Changes in Equity Company Ordinary share capital Share premium Retained Earnings Total £ £ £ £ Balance at 5 March 2015 - - - - - Loss for the period - - (580,500) (580,500) Total comprehensive income - - (580,500) (580,500) Transactions with owners: Issue of shares on incorporation 15,660 - - 15,660 Balance as at 30 September 2015 15,660 - (580,500) (564,840) Ordinary share capital Share premium Retained Earnings Total £ £ £ £ Balance at 1 October 2015 15,660 - (580,500) (564,840) Profit for the year - - 1,019,353 1,019,353 Total comprehensive income - - 1,019,353 1,019,353 Transactions with owners: Issue of shares 131,907 13,318,725 - 13,450,632 Dividends - - (383,675) (383,675) Total transactions with owners 131,907 13,318,725 (383,675) 13,066,957 Balance as at 30 September 2016 147,567 13,318,725 55,178 13,521,470 Notes to the Financial Statements 1 Critical accounting estimates and judgements The preparation of Financial Statements under IFRS requires the use of certain critical accounting assumptions, and requires management to exercise its judgment and to make estimates in the process of applying Cerillion's accounting policies. Judgements (i) Capitalisation of development costs Development costs are capitalised only after the technical and commercial feasibility of the asset for sale or use have been established. This is determined by our intention to complete and/or use the intangible asset. The future economic benefits of the asset are reviewed using detailed cash flow projections. The key judgement is whether there will be a market for the products once they are available for sale. (ii) Revenue recognition Revenue is recognised on the basis of implementation of the project. In respect of long term contracts the revenue is in line with percentage completed in terms of effort to date as a percentage of total forecast effort. Total forecast is prepared by project managers on a monthly basis and reviewed by the project office and senior management team on a monthly basis. The key judgement is accurately forecasting the effort required to complete the project. (iii) Business combinations The legal and accounting acquirer is Cerillion plc. Cerillion plc acquired Cerillion Technologies Limited on 18 March 2016 for £14.6m, which was funded by a new fund raise and bank debt. The acquisition was to facilitate an exit for Cerillion's previous venture capital majority shareholders who were bought out in full for cash. Estimates (i) Business combinations Management uses valuation techniques in determining the fair values of various elements of a business combination. On initial recognition, the assets and liabilities of the acquired business are included in the consolidated statement of financial position at their provisional fair values. In measuring fair value, management uses estimates about future cash flows and discount rates, however, actual results may vary. See note 2. (ii) Depreciation and amortisation Depreciation and amortisation rates are based on estimates of the useful economic lives and residual values of the assets involved. The assessment of these useful economic lives is made by projecting the economic lifecycle of the asset. The key judgement is estimating the useful economic life of the development costs capitalised, a review is conducted annually by project. Depreciation and amortisation rates are changed where economic lives are re-assessed and technically obsolete items written off where necessary. Refer to notes 12 and 13. 2 Acquisitions The Company's controlling interest in its directly held subsidiary, Cerillion Technologies Limited, was acquired through a business combination as defined in IFRS 3 Business Combinations. As such the acquisition method of accounting for this transaction has been followed. The details of the business combination are as follows: Fair value adjustments Book value Fair value £ £ £ Recognised amounts of identifiable net assets Property, plant and equipment 400,799 400,799 Intangible assets 80,000 6,949,814 7,029,814 Deferred tax 354,054 354,054 Total non-current assets 834,853 6,949,814 7,784,667 Trade and other receivables 7,354,483 - 7,354,483 Cash and cash equivalents 3,522,371 - 3,522,371 Total current assets 10,876,854 - 10,876,854 Other non-current liabilities (120,000) (120,000) Deferred tax liabilities (70,660) (1,320,465) (1,391,125) Total non-current liabilities (190,660) (1,320,465) (1,511,125) Trade and other payables (4,471,966) - (4,471,966) Total current liabilities (4,471,966) - (4,471,966) Identifiable net assets 7,049,081 5,629,349 12,678,430 Goodwill arising on acquisition (note 12) 1,973,141 Fair value of consideration transferred Amount settled in cash 14,651,571 Total purchase consideration 14,651,571 Analysis of cash flows on acquisition Purchase consideration transferred settled in cash 14,651,571 Cash and cash equivalents acquired (3,522,371) Net cash flow on acquisition 11,129,200 Acquisition costs charged to expenses 746,055 The legal and accounting acquirer is Cerillion plc. Cerillion plc acquired Cerillion Technologies Limited on 18 March 2016 for £14.6m, which was funded by a new fund raise and bank debt. The acquisition was to facilitate an exit for Cerillion's previous venture capital majority shareholders who were bought out in full for cash. Consideration transferred Cerillion plc paid £14,651,571 cash on 18 March 2016 for 100% of the share capital and voting rights of Cerillion Technologies Limited. IPO costs amounting to £746,055 (2015: £580,500) are not included as part of consideration transferred and have been recognised as an expense in the consolidated statement of profit or loss and are disclosed as exceptional items on the face of the income statement. Identifiable net assets Net assets excluding intangibles of £5,648,616 and separately identified intangible net assets of £7,029,814 were acquired. The separately identified intangible net assets were made up of the current fair value of existing support and maintenance contracts (£4.38m) and IPR (£2.57m). The current fair value was calculated based on an estimate of future profits from these sources using a Weighted Average Cost of Capital (WACC) of 12.7%. Goodwill Goodwill arising on this transaction amounted to £1,973,141, of which £1,320,465 related to deferred tax arising on the provisional intangible assets recognised on the acquisition. The remaining goodwill of £652,676 is primarily related to growth expectations, expected future profitability, the substantial skill and expertise of Cerillion Technologies' workforce and expected cost synergies. Goodwill has not been allocated to a particular segment and is not expected to be deductible for tax purposes. Cerillion Technologies Limited's contribution to the Group results In consequence, the consolidated financial statements for Cerillion plc report the result of operations for the period from date of acquisition being 18 March 2016 to 30 September 2016. Similarly, the consolidated balance sheet and other financial information have been presented as though the assets and liabilities were acquired on 18 March 2016. Cerillion Technologies Limited group generated revenues of £8,364,774 and a profit of £1,578,822 for the period from 18 March 2016 to 30 September 2016. If Cerillion Technologies Limited group had been acquired on 1 October 2015, revenue of the Group for 2015 would have been £14,809,939, and profit for the year would have been £2,154,308. 3 Segment information During the year ended 30 September 2016, the Group was organised into four main business segments for revenue purposes. Under IFRS 8 there is a requirement to show the profit or loss for each reportable segments and the total assets and total liabilities for each reportable segment if such amounts are regularly provided to the chief operating decision maker. In respect of the profit or loss for each reportable segment the expenses are not reported by segment and cannot be allocated on a reasonable basis and, as a result, the analysis is limited to the Group revenue. Assets and liabilities are used or incurred across all segments and therefore are not split between segments. Year to 30 September2016 Period from 5 March 2015 to 30 September 2015* £ £ Revenue Services 5,358,998 - Software 2,467,507 - Software as a Service 147,266 - 3rd party 391,003 - Total revenue 8,364,774 - (a) Geographical information As noted above, the internal reporting of the Group's performance does not require that the statement of financial position information is gathered on the basis of the business streams. However, the Group operates within discrete geographical markets such that capital expenditure, total assets and net assets of the Group are split between these locations as follows: Europe MEA Americas Asiapac £ £ £ £ Year ended 30 September 2016 Revenue 1,851,745 888,575 4,835,022 789,432 Capital expenditure 686,774 - - 51,330 Total assets 23,392,783 - - 542,836 Net assets 12,397,168 - - 557,830 * Comprises the plc Parent Company only, as the Group came into existence on 18 March 2016. Cerillion receives greater than 10% of revenue from individual customers in the following geographical regions: Operating 2016 segment £ Customer No. 1 Americas 4,239,879 No. 2 MEA 859,256 The group had no revenue or capital expenditure for the year ended 30 September 2015 and all the assets and liabilities were within the UK based Parent Company (Europe segment). 4 Operating profit/(loss) Year to 30 September 2016 Period from 5 March 2015 to 30 September 2015* £ £ Operating profit/(loss) is stated after (crediting)/charging: Depreciation 142,695 - Amortisation of intangibles 571,555 - Research and development costs 172,978 - Exceptional item - IPO costs 746,055 580,500 Bad debt expense 495,649 - Foreign exchange gains (544,389) - Operating leases 412,852 - Fees payable to Cerillion's principal auditor: - Audit of Cerillion PLC's annual accounts 5,000 5,000 - Audit of subsidiaries 40,000 - - Non-audit services - tax services 12,400 - - Non-audit services - corporate finance 145,000 - - Non-audit services - other 8,000 - Fees payable to associates of principal auditor: - Audit of subsidiaries 8,000 - - Non-audit services - tax services 13,200 - The Company did not generate revenue during the period to 30 September 2015. Expenses in that period related to professional fees in relation to the admission of the Company to AIM. * Comprises the plc Parent Company only, as the Group came into existence on 18 March 2016. 5 Directors and employees Year to 30 September 2016 Period from 5 March 2015 to 30 September 2015 Group £ £ Employee costs (including Directors): Wages and salaries 4,079,149 - Social security costs 311,036 - Payments into defined contribution pension schemes 170,521 - 4,560,706 - Year to 30 September 2016 Period from 5 March 2015 to 30 September 2015 Number Number The average number of employees (including Directors) during the year was made up as follows: Management and administration 20 - Sales and marketing 12 Support and development staff 125 - Executive Directors 3 3 Non-executive Directors 2 - 162 3 For details of Directors' remuneration, refer to the Remuneration report on pages 16 and 17. Key management personnel is covered in note 24. None of the Company's directors received or were entitled to receive any remuneration from the Company for their services during the period from incorporation to 30 September 2015. There were no employees during the period ended 30 September 2015. 6 Finance income Year to 30 September 2016 Period from 5 March 2015 to 30 September 2015 £ £ Finance income: Bank interest receivable 6,059 - 7 Finance costs Year to 30 September 2016 Period from 5 March 2015 to 30 September 2015 £ £ Finance costs: Interest payable in respect of loans (78,149) - Fair value loss on forward exchange contracts (121,410) - (199,559) - 8 Taxation (a) Analysis of tax charge for the year/period The tax charge for the group is based on the profit/(loss) for the year/period and represents: Year to 30 September 2016 Period from 5 March 2015 to 30 September 2015 £ £ Current tax (credit)/expense (3,804) - Deferred tax (credit)/charge (64,228) - Total tax (credit)/charge (68,032) - (b) Factors affecting total tax for the year/period The tax assessed for the year/period differs from the standard rate of corporation tax in the United Kingdom 20.0% (2015: 20.0%). The differences are explained as follows: The tax assessed for the year/period differs from the standard rate of corporation tax in the United Kingdom 20.0% (2015: 20.0%). The differences are explained as follows: Profit/(loss) on ordinary activities before tax 238,936 (580,500) Profit/(loss) on ordinary activities multiplied by standard rate of corporation tax in the United Kingdom of 20.0% (2015: 20.0%) 47,787 (116,100) Effect of: Expenses not deductible for tax purposes 195,446 116,100 Difference in tax rates 23,506 - Other temporary differences (120,470) - Surrender of tax losses 29,113 - Losses carried forward 26,918 - R&D tax credit payable (21,107) - Enhanced relief for research and development (249,225) - Total tax (credit)/charge (68,032) - - There are currently no deferred tax assets or liabilities recognised within the parent company accounts. Taxable losses within the parent company totalling £134,591 (2015: £nil) have been carried forward, but no deferred tax asset has been recognised in relation to these losses due to the uncertainty surrounding the timing of their recovery. 9 Profit/(loss) attributable to Cerillion plc The profit/(loss) for the financial year/period of the Parent Company, Cerillion plc was £1,019,353 (2015: loss £580,500). As permitted by section 408 of the Companies Act 2006, no separate income statement is presented in respect of the Parent Company. 10 Dividends (a) Dividends paid during the reporting period The Board declared a maiden interim dividend of 1.3p (2015: nil pence) per share totalling £383,675 (2015: £nil) in line with the Company's dividend policy, which was paid on 23 June 2016. (b) Dividends not recognised at the end of the reporting period Since the year end the Directors have proposed the payment of a dividend in respect of the full financial year of 2.6p per fully paid Ordinary share (2015: £nil). The aggregate amount of the proposed dividend expected to be paid out of retained earnings at 30 September 2016, but not recognised as a liability at the year end is £767,351 (2015: £nil). 11 Earnings/(loss) per share Basic earnings/(loss) per share is calculated by dividing the profit/(loss) attributable to equity holders of the Company by the weighted average number of Ordinary Shares in issue during the year/period. The A Ordinary Shares in existence as at 30 September 2015 have been classified as a liability and are therefore excluded from the earnings per share calculation. Year to 30 September 2016 Period from 5 March 2015 to 30 September 2015 Profit/(loss) attributable to equity holders of the Company (£) 306,968 (580,500) - More to follow, for following part double click ID:nRSb2323Qc