REG - Concurrent Tech. - Interim Results for the six months ended 30 Jun 17 <Origin Href="QuoteRef">CNCT.L</Origin>

Concurrent TechnologiesAnnouncement

18/09/2017 07:31

RNS Number : 9613Q
Concurrent Technologies PLC
18 September 2017
18 September 2017
Concurrent Technologies Plc
(the "Company" or the "Group")
Interim Results for the six months ended 30 June 2017
Concurrent Technologies Plc (AIM: CNC), a world leading specialist in the design and manufacture of high-end embedded computer boards for critical applications, announces interim results for the six months to 30 June 2017.
Financial Highlights
 Turnover of 7.8m (H1 2016: 9.0m)1
 Gross profit 4.3m (H1 2016: 4.9m)
 Gross margin maintained at 54.8% (H1 2016: 54.8%)
 Profit before tax of 1.4m (H1 2016: 1.5m)
 EPS of 1.84 pence (H1 2016: 2.12 pence)
 Interim dividend increased by 12.5% to 0.90p per share (H1 2016: 0.80p)
 Cash balance (including cash deposits) at 30 June 2017 of 7.9m (H1 2016: 8.2m)
1. H1 2016 turnover was inflated by an exceptional sale
Operational Highlights
Defence related sales, in particular from US customers, now account for more than half of the Group revenues and continue to drive the business
  Expanding global customer base with exports generating 84% of Group revenues (H1 2016: 81%)
 1.2m invested into R&D during the period, resulting in strong pipeline of future product releases
Release of two new rugged conduction-cooled boards, plus the launch of new range of Intel Xeon boards during the period
Michael Collins, Chairman of Concurrent Technologies Plc, commented:
"After a solid performance in the first-half of the year we have started the second-half with an expanding list of customers, many new opportunities and a strong balance sheet. The outlook for the future remains positive."
Enquiries:
Concurrent Technologies Plc
Glen Fawcett, CEO
+44 (0)1206 752 626
Newgate (Financial PR)
Bob Huxford
James Browne

+44 (0)207 653 9850
Cenkos Securities plc (NOMAD)
Neil McDonald
Nick Tulloch
Beth McKiernan

+44 (0)131 220 9771
+44 (0)131 220 9772
+44 (0)131 220 9778
About Concurrent Technologies Plc
Concurrent Technologies Plc develops and manufactures high-end embedded computer products for use in a wide range of high performance, long life cycle applications within the telecommunications, defence, security, telemetry, scientific and aerospace markets, including applications within extremely harsh environments. The processor products traditionally feature Intel processors, including the latest generation Intel Core i7 processors, Intel Xeon and Intel Atom processors. More recently NVIDIA Tegra K1 devices have been added to the product ranges along with complementary switch and I/O boards. The products are designed to be compliant with industry specifications and support many of today's leading embedded Operating Systems. The products are sold world-wide.
For more information on Concurrent Technologies Plc and its products please visit www.cct.co.uk
All trademarks, registered trademarks and trade names used in this announcement are the property of their respective owners.
CHAIRMAN'S STATEMENT
Financial Summary
I am pleased to report a good performance for the first-half of 2017, consolidating the strong performances from the last two years.
Revenue for the period was 7.8m (H1 2016: 9.0m), the variance is largely due to an exceptional sale in early 2016 and defence customer delays in H1 2017. Gross profitability was 4.3m (H1 2016: 4.9m). Gross margins were maintained at 54.8% (H1 2016: 54.8%). The unaudited profit before tax for the same period was 1.4m (H1 2016: 1.5m) with associated earnings per share of 1.84 pence (H1 2016: 2.12 pence).
The Group balance sheet has been strengthened with cash balances (including cash deposits) at
30 June 2017 of 7.9m (H1 2016: 8.2m) and total equity increased to 18.0m (H1 2016: 16.7m).
Dividend
The Board has declared a first interim dividend of 0.90p per share (H1 2016: 0.80p) - an increase of 12.5%. The total cost of this dividend will amount to 654,466. The ex-dividend date for this interim dividend is 28 September 2017, the record date is 29 September 2017 and the payment date is 13 October 2017.
Review of Operations
Defence related revenues continue to drive the business, in particular from US customers, who now account for more than half of the Group sales. Exports generated 84% of total Group revenues (H1 2016: 81%). During this reporting period, many new customers have been gained.
The Group invested 1.2m during H1 2017 (H1 2016: 1.2m) in research and development for new products and their associated variants. This investment in innovative engineering solutions should help safeguard revenues in future years. Many products have completed exhaustive testing in the first-half of 2017 and the pipeline for future product releases is encouraging.
The Company still awaits confirmation of the trade and tariff legislation to be agreed by the UK Government with other countries. Because most countries, including the USA and those of the European Union, apply a zero-percentage import tariff rating to our products we don't expect our business to be affected. The vote to leave the European Union has had little impact on trading; the main effect has been seen in the difficulty of recruiting non-UK research and development engineers to work in the UK and we wait to see if this is just a temporary situation.
Future Plans
We will continue to expand our product ranges through the development of new boards and systems together with complementary software. In particular, we will focus on our VPX products in both ruggedized and non-ruggedized variants. These new products will be designed for our key market sectors of complex, high technology, low to medium volume and high margin applications.
To improve the development process, the Group will this year invest in more development equipment including a sophisticated multi-gigabit per second high-speed analyser. In addition, to provide a more flexible response to customer orders, a faster "pick and place" machine will be acquired in mid-2018. This type of machine is used for high-speed, fine-precision placement of surface-mount components onto printed circuit boards.
Outlook
After a solid performance in the first-half of the year we have started the second-half with an expanding list of customers, many new opportunities and a strong balance sheet. The outlook for the future remains positive.
Michael Collins
Chairman
15th September 2017
All companies and product names are trademarks of their respective organisations.
CONDENSED CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME
unaudited interim results to 30 June 2017
Note
Six months ended
30/06/17
Six months ended
30/06/16
Year ended 31/12/16
CONTINUING OPERATIONS
Revenue
 7,816,472 
 8,970,694 
 16,423,978 
Cost of sales
 3,536,288 
 4,054,125 
 7,529,867 
Gross profit
 4,280,184 
 4,916,569 
 8,894,111 
Net operating expenses
 2,914,116 
 3,397,753 
 6,040,302 
Group operating profit
 1,366,068 
 1,518,816 
 2,853,809 
Finance income
 30,375 
 26,336 
 48,705 
Profit before tax
 1,396,443 
 1,545,152 
 2,902,514 
Tax
 56,997 
 4,824 
 72,609 
Profit for the period
 1,339,446 
 1,540,328 
 2,829,905 
Other Comprehensive Income
Exchange differences on translating foreign operations
 (93,622)
 223,385 
 415,966 
Tax relating to components of other comprehensive income
 - 
 - 
 - 
Other Comprehensive Income for the period, net of tax
 (93,622)
 223,385 
 415,966 
Total Comprehensive Income for the period
 1,245,824 
 1,763,713 
 3,245,871 
Profit for the period attributable to:
Equity holders of the parent
 1,339,446 
 1,540,328 
 2,829,905 
Total Comprehensive Income attributable to:
Equity holders of the parent
 1,245,824 
 1,763,713 
 3,245,871 
Earnings per share
Basic earnings per share
4
1.84p
2.12p
3.90p
Diluted earnings per share
4
1.84p
2.12p
3.90p
CONDENSED CONSOLIDATED BALANCE SHEET
unaudited interim results to 30 June 2017
As at
As at
As at
30/06/17
30/06/16
31/12/16
ASSETS
 
 
 
Non-current assets
Property, plant and equipment
 391,651 
 643,786 
 414,209 
Intangible assets
 7,369,683 
 6,397,135 
 6,846,520 
Deferred tax assets
 146,023 
 101,361 
 112,128 
 7,907,357 
 7,142,282 
 7,372,857 
Current assets
Inventories
 3,334,750 
 2,870,131 
 3,239,855 
Trade and other receivables
 2,526,923 
 2,642,486 
 3,327,629 
Current tax assets
 203,710 
 163,180 
 93,156 
Other financial assets
 - 
 - 
 1,000,000 
Cash and cash equivalents
 7,885,032 
 8,179,993 
 6,773,083 
 13,950,415 
 13,855,790 
 14,433,723 
Total assets
 21,857,772 
 20,998,072 
 21,806,580 
LIABILITIES
Non-current liabilities
Deferred tax liabilities
 1,417,245 
 1,280,077 
 1,291,468 
Long term provisions
 3,986 
 10,398 
 6,699 
 1,421,231 
 1,290,475 
 1,298,167 
Current liabilities
Trade and other payables
 2,384,949 
 2,938,487 
 2,810,655 
Short term provisions
 19,932 
 32,712 
 23,939 
Current tax liabilities
 - 
 6,735 
 - 
 2,404,881 
 2,977,934 
 2,834,594 
Total liabilities
 3,826,112 
 4,268,409 
 4,132,761 
Net assets
 18,031,660 
 16,729,663 
 17,673,819 
EQUITY
Capital and reserves
Share capital
 739,000 
 739,000 
 739,000 
Share premium account
 3,684,871 
 3,693,818 
 3,693,818 
Capital redemption reserve
 256,976 
 256,976 
 256,976 
Cumulative translation reserve
 400,985 
 302,026 
 494,607 
Profit and loss account
 12,949,828 
 11,737,843 
 12,489,418 
Equity attributable to equity holders of the parent
 18,031,660 
 16,729,663 
 17,673,819 
Total equity
 18,031,660 
 16,729,663 
 17,673,819 
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
unaudited interim results to 30 June 2017
Six months ended
30/06/17
Six months ended
30/06/16
Year ended 31/12/16
Cash flows from operating activities
Profit before tax for the period
 1,396,443 
 1,545,152 
 2,902,514 
Adjustments for:
 
Finance income 
 (30,375)
 (26,336)
 (48,705)
Depreciation 
 77,624 
 98,966 
 196,370 
Amortisation 
 620,878 
 627,065 
 1,254,826 
Impairment loss 
 31,064 
 499,509 
 499,509 
Loss on disposal of property, plant and equipment
 - 
 - 
 233,840 
Share-based payment 
 13,611 
 1,139 
 13,585 
Exchange differences 
 (200,228)
 272,299 
 76,461 
(Increase)/decrease in inventories 
 (94,895)
 904,154 
 534,430 
(Increase)/decrease in trade and other receivables 
 800,706 
 (121,913)
 (927,530)
Increase/(decrease) in trade and other payables 
 (432,426)
 528,208 
 558,815 
Cash generated from operations
 2,182,402 
 4,328,243 
 5,294,115 
Tax received/(paid)
 (32,395)
 120,715 
 116,142 
Net cash generated from operating activities
 2,150,007 
 4,448,958 
 5,410,257 
Cash flows from investing activities
Interest received
 30,375 
 26,336 
 48,705 
Cash released from/(placed on) deposit
 1,000,000 
 1,000,000 
 - 
Purchases of property, plant and equipment
 (56,977)
 (43,728)
 (138,181)
Proceeds from sale of property, plant and equipment
 - 
 - 
 - 
Purchases of intangible assets
 (1,175,613)
 (1,214,874)
 (2,290,889)
Net cash used in investing activities
 (202,215)
 (232,266)
 (2,380,365)
Cash flows from financing activities
Equity dividends paid
 (945,339)
 (870,942)
 (1,452,689)
Sale/(purchase) of treasury shares
 - 
 19,800 
 51,800 
Net cash used in financing activities
 (945,339)
 (851,142)
 (1,400,889)
Effects of exchange rate changes on cash and cash equivalents
 109,496 
 (59,372)
 270,265 
Net increase/(decrease) in cash
 1,111,949 
 3,306,178 
 1,899,268 
Cash at beginning of period
 6,773,083 
 4,873,815 
 4,873,815 
Cash at the end of the period
 7,885,032 
 8,179,993 
 6,773,083 
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
unaudited interim results to 30 June 2017
Share
capital
Share
Premium
Capital
redemption
reserve
Cumulative
translation
reserve
Profit
and loss
account
Total
equity
Balance at 1 January 2016
739,000
3,693,818
256,976
78,641
11,053,079
15,821,514
Profit for the period
- 
- 
- 
- 
1,540,328
1,540,328
Exchange differences on translating foreign operations
- 
- 
- 
223,385
- 
223,385
Total recognised comprehensive income for the period
- 
- 
- 
223,385
1,540,328
1,763,713
Share-based payment
- 
- 
- 
- 
1,139
1,139
Deferred tax on share based payment
- 
- 
- 
- 
(5,561)
(5,561)
Dividends paid
- 
- 
- 
- 
(870,942)
(870,942)
Sale of treasury shares
- 
- 
- 
- 
19,800
19,800
Balance at 30 June 2016
739,000
3,693,818
256,976
302,026
11,737,843
16,729,663
Profit for the period
- 
- 
- 
- 
1,289,577
1,289,577
Exchange differences on translating foreign operations
- 
- 
- 
192,581
- 
192,581
Total recognised comprehensive income for the period
- 
- 
- 
192,581
1,289,577
1,482,158
Share-based payment
- 
- 
- 
- 
12,446
12,446
Deferred tax on share based payment
- 
- 
- 
- 
(701)
(701)
Dividends paid
- 
- 
- 
- 
(581,747)
(581,747)
Purchase of treasury shares
- 
- 
- 
- 
32,000
32,000
Balance at 31 December 2016
739,000
3,693,818
256,976
494,607
12,489,418
17,673,819
Profit for the period
- 
- 
- 
- 
1,339,446
1,339,446
Exchange differences on translating foreign operations
- 
- 
- 
(93,622)
- 
(93,622)
Total recognised comprehensive income for the period
- 
- 
- 
(93,622)
1,339,446
1,245,824
Share-based payment
- 
- 
- 
- 
13,611
13,611
Deferred tax on share based payment
- 
- 
- 
- 
43,274
43,274
Dividends paid
- 
- 
- 
- 
(945,339)
(945,339)
Sale of treasury shares
- 
(8,947)
- 
- 
9,418
471
Balance at 30 June 2017
739,000
3,684,871
256,976
400,985
12,949,828
18,031,660
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 15th September, 2017.
The information relating to the six months ended 30 June 2017 and 30 June 2016 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 2016, prepared in accordance with IFRSs (International Financial Reporting Standards) as adopted by the European Union, have been reported on by the Group's auditors and delivered to the Registrar of Companies. The auditors' report was unqualified, did not draw attention to any matters by way of emphasis and did not contain a statement under section 498(2) or (3) of the Companies Act 2006.
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 2017. 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 2016, which have been prepared in accordance with adopted IFRSs.
The accounting policies applied and methods of computation are consistent with those of the annual financial statements for the year ended 31 December 2016, 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 1 January 2017 that would be expected to have a material impact on the results or financial position of the Group.
2.2
Going Concern
The Directors are satisfied that the Group has sufficient resources to continue in operation for the foreseeable future, a period of not less than 12 months from the date of this report. Accordingly, they continue to adopt the going concern basis in preparing these condensed financial statements.
2.3
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
30/06/17
Six months ended
30/06/16
Year ended 31/12/16
Profit attributable to ordinary equity holders
1,339,446
1,540,328
2,829,905
Six months ended
30/06/17
Six months ended
30/06/16
Year ended 31/12/16
No
No
No
Weighted average number of ordinary 
shares for basic earnings per share
72,718,490
72,604,009
72,635,976
Adjustment for share options
2,457
481
2,457
Weighted average number of ordinary shares for diluted earnings per share
72,720,947
72,604,490
72,638,433
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.

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