REG - Concurrent Tech. - Half Yearly Report <Origin Href="QuoteRef">CNCT.L</Origin>

Concurrent TechnologiesAnnouncement

02/09/2015 07:00

RNS Number : 7672X
Concurrent Technologies PLC
02 September 2015
02 September 2015
CONCURRENT TECHNOLOGIES PLC
Interim Results for the six months ended 30 June 2015
Concurrent Technologies Plc (the "Company"), a world leading specialist in the design and manufacture of high-end embedded computer products, for critical applications in the defence, aerospace, transportation, telecommunications, scientific and industrial markets, announces interim results for the six months to 30 June 2015. 
Financial Highlights:
 Turnover up 72% to 9.6m (H1 2014: 5.6m)
 Profit before tax 1.6m (H1 2014: 0.4m)
 Earnings per share for the period 2.06p (H1 2014: 0.56p)
 Interim dividend 0.70p per share (H1 2014: 0.65p)
 Net cash, including cash deposits 5.7m (H1 2014: 4.8m);no borrowings
Operational Highlights:
 Further increased investment in R&D
 Release of four new high performance products
 Investment in new manufacturing equipment to increase capacity
Michael Collins, Chairman, commented:
"Our order book is robust, our cash position remains strong and, while our second half performance is not expected to match the first half, we look forward to a satisfactory outcome for the remainder of this year. Continued investment in the Group's diverse and expanding product range and customer base should continue to deliver solid results in the future."
Enquiries:
Concurrent Technologies Plc
Glen Fawcett, Managing Director
+44 (0)1206 752 626


Newgate (Financial PR)
Tim Thompson
Robyn McConnachie

+44 (0)207 653 9850


Cenkos Securities plc (NOMAD)
Neil McDonald
Nick Tulloch

+44 (0)131 220 9771
+44 (0)131 220 9772
CHAIRMAN'S STATEMENT
Financial Summary
I am delighted to report an excellent start to 2015 with results significantly ahead of our earlier expectations. The Group turnover was 72% higher than the same period last year at 9.60m (H1 2014: 5.57m), with increases across all our markets together with an improved gross margin of 48.7% (H1 2014: 48.0%). The unaudited profit before tax for the six months to 30 June 2015 was 1.61m (H1 2014: 0.42m) with associated earnings per share of 2.06 pence (H1 2014: 0.56 pence). 
At the end of the period, we had a sound balance sheet with a healthy cash position of 5.70m (H1 2014: 4.85m), notwithstanding an increase in working capital of 0.80m due to increased sales volumes (H1 2014: reduction of 0.46m), increased R&D expenditure and enhanced dividend payments during the first half of 2015.
Review of Operations
Our turnover during the first half of 2015 improved compared to H1 2014. Sales into telecommunication applications have grown by 91%, due mainly to continued sales of AMC architecture computers for test equipment. Defence related revenues have improved by 50% and sales associated with scientific applications, particularly for physics research projects, have increased by 136%.
Investment in R&D has increased with all three teams in the UK, India and USA now operational. Total expenditure on R&D of 1.60m for H1 2015 compares with 1.34m for H1 2014 - an increase of 19%.
New products released during this first half of the year include four new high performance embedded computers, with long life-cycle devices and featuring the latest technology including low power Intel Atom processors and 4th generation Intel Core processors. These provide long term upgrade paths across our product architectures. We have also released further accessory boards to augment the functionality of our main products.
Manufacturing capacity and throughput were increased during the period by the acquisition of an additional fast electronic component placement machine.
Future Plans
Continual investment in R&D is critical to ensure a constant expansion of our range of advanced technology products and thereby enhance our competitive position. Our products are used in a wide range of increasingly sophisticated, high-reliability computer systems and our objective remains to design more innovative products for complex, high technology, low to medium volume and high margin applications. We will continue to expand our range by developing products for the VPX, VME, AMC and CompactPCI bus architectures. Many versions of these products will be designed for use in harsh environments. We will continue to develop the capabilities of these products with new and complementary software and firmware packages. These will provide high-speed data transfer, ease of integration and security which will further enhance our product portfolio.
Dividend
The Board has declared an interim dividend of 0.70p per share (H1 2014: 0.65p) - an increase of 7.7%. The total cost of this dividend will amount to 508,203. The ex-dividend date for the interim dividend is 10 September 2015, the record date is 11 September 2015 and the payment date is 18 September 2015.
Outlook
Our order book is robust, our cash position remains strong and, while our second half performance is not expected to match the first half, we look forward to a satisfactory outcome for the remainder of this year. Continued investment in the Group's diverse and expanding product range and customer base should continue to deliver solid results in the future.
Michael Collins
Chairman
01 September 2015
All companies and product names are trademarks of their respective organisations.
CONDENSED CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME
unaudited interim results to 30 June 2015

Note
Six months ended
30/06/15

Six months ended
30/06/14

Year ended 31/12/14




CONTINUING OPERATIONS






Revenue

9,595,467

5,574,557

12,806,315
Cost of sales

4,923,619

2,899,117

6,247,748
Gross profit

4,671,848

2,675,440

6,558,567
Net operating expenses

3,078,775

2,286,611

4,892,800
Group operating profit

1,593,073

388,829

1,665,767
Finance income

17,224

35,509

58,079
Profit before tax

1,610,297

424,338

1,723,846
Tax

112,420

24,923

76,148
Profit for the period

1,497,877

399,415

1,647,698







Other Comprehensive Income






Exchange differences on translating foreign operations

79,535

(29,037)

90,539
Tax relating to components of other comprehensive income

- 

- 

- 
Other Comprehensive Income for the period, net of tax

79,535

(29,037)

90,539
Total Comprehensive Income for the period

1,577,412

370,378

1,738,237







Profit for the period attributable to:






Equity holders of the parent

1,497,877

399,415

1,647,698







Total Comprehensive Income attributable to:






Equity holders of the parent

1,577,412

370,378

1,738,237







Earnings per share






Basic earnings per share
4
2.06p

0.56p

2.28p







Diluted earnings per share
4
2.06p

0.55p

2.28p
CONDENSED CONSOLIDATED BALANCE SHEET
unaudited interim results to 30 June 2015


As at

As at

As at


30/06/15

30/06/14

31/12/14
ASSETS

 

 

 
Non-current assets






Property, plant and equipment

695,632

609,986

608,044
Intangible assets

6,026,976

5,845,981

6,018,931
Deferred tax assets

105,398

82,813

73,440


6,828,006

6,538,780

6,700,415
Current assets






Inventories

4,184,343

2,536,345

2,699,658
Trade and other receivables

3,095,560

2,210,893

2,790,426
Current tax assets

75,565

284,726

307,912
Other financial assets

- 

2,585,066

- 
Cash and cash equivalents

5,700,287

2,261,771

5,624,505


13,055,755

9,878,801

11,422,501







Total assets

19,883,761

16,417,581

18,122,916







LIABILITIES






Non-current liabilities






Deferred tax liabilities

1,283,929

1,257,824

1,279,852
Long term provisions

10,981

10,009

7,314


1,294,910

1,267,833

1,287,166
Current liabilities






Trade and other payables

3,488,379

1,708,720

2,500,524
Short term provisions

33,726

36,813

33,922
Current tax liabilities

3,072

2,998

665


3,525,177

1,748,531

2,535,111







Total liabilities

4,820,087

3,016,364

3,822,277







Net assets

15,063,674

13,401,217

14,300,639







EQUITY






Capital and reserves






Share capital

739,000 

739,000 

739,000 
Share premium account

3,693,818

3,693,818

3,693,818
Capital redemption reserve

256,976 

256,976 

256,976 
Cumulative translation reserve

95,258

(103,853)

15,723
Profit and loss account

10,278,622

8,815,276

9,595,122
Equity attributable to equity holders of the parent

15,063,674

13,401,217

14,300,639







Total equity

15,063,674

13,401,217

14,300,639
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
unaudited interim results to 30 June 2015


Six months ended
30/06/15

Six months ended
30/06/14

Year ended 31/12/14




Cash flows from operating activities






Profit before tax for the period

1,610,297

424,338

1,723,846
Adjustments for:
 





Finance income 

(17,224)

(35,509)

(58,079)
Depreciation 

106,821

85,070

178,059
Amortisation 

638,198

588,056

1,160,940
Impairment loss 

505,727

- 

450,000
Share-based payment 

9,787

2,814

6,279
Exchange differences 

94,681

15,635

29,060
(Increase)/decrease in inventories 

(1,484,685)

14,211

(149,102)
(Increase)/decrease in trade and other receivables 

(305,134)

663,461

83,928
Increase/(decrease) in trade and other payables 

991,326

(222,390)

563,828
Cash generated from operations

2,149,794

1,535,686

3,988,759
Tax received/(paid)

105,193

45,628

284
Net cash generated from operating activities

2,254,987

1,581,314

3,989,043







Cash flows from investing activities






Interest received

17,224

35,509

58,079
Cash placed on deposit

- 

- 

2,602,689
Purchases of property, plant and equipment

(195,398)

(217,066)

(303,816)
Purchases of intangible assets

(1,152,257)

(966,532)

(2,161,809)
Net cash used in investing activities

(1,330,431)

(1,148,089)

195,143







Cash flows from financing activities






Equity dividends paid

(834,904)

(785,404)

(1,257,305)
Cash received from share issue

- 

300,001

300,001
Net cash used in financing activities

(834,904)

(485,403)

(957,304)







Effects of exchange rate changes on cash and cash equivalents

(13,870)

(26,910)

56,764







Net increase/(decrease) in cash

75,782

(79,088)

3,283,646
Cash at beginning of period

5,624,505

2,340,859

2,340,859
Cash at the end of the period

5,700,287

2,261,771

5,624,505







CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
unaudited interim results to 30 June 2015

Share
capital
Share
Premium
Capital
redemption
reserve
Cumulative
translation
reserve
Profit
and loss
account
Total
equity



Balance at 1 January 2014
727,000
3,405,817
256,976
(74,816)
9,212,552
13,527,529







Profit for the period
- 
- 
- 
- 
399,415
399,415
Exchange differences on translating foreign operations
- 
- 
- 
(29,037)
- 
(29,037)
Total recognised comprehensive income for the period
- 
- 
- 
(29,037)
399,415
370,378







Share-based payment
- 
- 
- 
- 
2,814
2,814
Deferred tax on share based payment
- 
- 
- 
- 
(14,101)
(14,101)
Dividends paid
- 
- 
- 
- 
(785,404)
(785,404)
Issue of Ordinary shares
12,000
288,001
- 
- 
- 
300,001
Balance at 30 June 2014
739,000
3,693,818
256,976
(103,853)
8,815,276
13,401,217







Profit for the period
- 
- 
- 
- 
1,248,283
1,248,283
Exchange differences on translating foreign operations
- 
- 
- 
119,576
- 
119,576
Total recognised comprehensive income for the period
- 
- 
- 
119,576
1,248,283
1,367,859







Share-based payment
- 
- 
- 
- 
3,465
3,465
Deferred tax on share based payment
- 
- 
- 
- 
(1)
(1)
Dividends paid
- 
- 
- 
- 
(471,901)
(471,901)
Balance at 31 December 2014
739,000
3,693,818
256,976
15,723
9,595,122
14,300,639







Profit for the period
- 
- 
- 
- 
1,497,877
1,497,877
Exchange differences on translating foreign operations
- 
- 
- 
79,535
- 
79,535
Total recognised comprehensive income for the period
- 
- 
- 
79,535
1,497,877
1,577,412







Share-based payment
- 
- 
- 
- 
9,787
9,787
Deferred tax on share based payment
- 
- 
- 
- 
10,740
10,740
Dividends paid
- 
- 
- 
- 
(834,904)
(834,904)
Balance at 30 June 2015
739,000
3,693,818
256,976
95,258
10,278,622
15,063,674
NOTES TO THE INTERIM REPORT
1.
General information

The principal activity of Concurrent Technologies Plc and its subsidiaries ("the Group") is the design, development, manufacture and marketing of single board computers for system integrators and original equipment manufacturers.
Concurrent Technologies Plc ("the Company") is the Group's ultimate parent company. It is incorporated and domiciled in Great Britain. Concurrent Technologies Plc shares are listed on the Alternative Investment Market of the London Stock Exchange.
The Group's condensed consolidated interim financial statements are presented in pounds sterling (), which is also the functional currency of the parent company.
These condensed consolidated interim financial statements, which are unaudited, have been approved for issue by the Board of Directors on 1 September 2015.
The information relating to the six months ended 30 June 2015 and 30 June 2014 is unaudited and does not constitute statutory accounts within the meaning of section 434 of the Companies Act 2006. The statutory accounts for the year ended 31 December 2014, prepared under adopted IFRS (International Financial Reporting Standards), have been reported on by the Group's auditors and delivered to the Registrar of Companies. The auditors' report in accordance with Chapter 3 of Part 16 of the Companies Act 2006 in relation to those accounts was unqualified.
2.
Summary of significant accounting policies
2.1
Basis of preparation

These condensed consolidated interim financial statements are for the six months ended 30 June 2015. They have been prepared in accordance with IAS 34 "Interim Financial Reporting". They do not include all of the information required for full annual financial statements, and should be read in conjunction with the consolidated financial statements of the Group for the year ended 31 December 2014, which have been prepared in accordance with IFRSs.
The accounting policies applied and methods of computation are consistent with those of the annual financial statements for the year ended 31 December 2014, as described in those financial statements. The accounting policies have been consistently applied to all the periods presented.
There are no new IFRSs or IFRIC interpretations that are effective for the first time for the financial period beginning on or after 01 January 2015 that would be expected to have a material impact on the results or financial position of the Group.
2.2
Taxation

Current tax expense is recognised in these condensed consolidated interim financial statements based on estimated effective tax rates for the full year. 
3.
Segmental reporting

The Directors consider that the Group is engaged in a single segment of business, being design, manufacture and supply of high-end embedded computer products, and that therefore the Company has only a single operating segment. The key measure of performance used by the Board to assess the Group's performance is the Group's profit before tax, as calculated under IFRS, and therefore no reconciliation is required between the measure of profit or loss used by the Board and that contained in the condensed consolidated interim financial statements.
4.
Earnings per share

Basic earnings per share is calculated by dividing the profit attributable to ordinary equity holders for the period by the weighted average number of ordinary shares outstanding during the period.
Diluted earnings per share is calculated adjusting the weighted average number of ordinary shares outstanding to assume conversion of all contracted dilutive potential ordinary shares. The Company only has one category of dilutive potential ordinary shares, share options.
The inputs to the earnings per share calculation are shown below:


Six months ended
30/06/15

Six months ended
30/06/14

Year ended 31/12/14














Profit attributable to ordinary equity holders

1,497,877

399,415

1,647,698



Six months ended
30/06/15

Six months ended
30/06/14

Year ended 31/12/14



No

No

No

Weighted average number of ordinary 
shares for basic earnings per share

72,600,490

71,950,766

72,278,298

Adjustment for share options

7,872

22,337

11,992

Weighted average number of ordinary shares for diluted earnings per share

72,608,362

71,973,103

72,290,290










5.
Post reporting date events
There were no material events subsequent to the end of the interim reporting period that have not been reflected in these interim financial statements.


6.
Shareholder Communication
A copy of this interim statement is available from the Company's Registered Office at 4 Gilberd Court, Newcomen Way, Colchester, Essex, CO4 9WN, UK and from the Company's website at www.cct.co.uk.



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The company news service from the London Stock Exchange
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