REG - IDOX PLC - Half-year Report
15/06/2022 07:00
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RNS Number : 8869O IDOX PLC 15 June 2022
15 June 2022
Idox plc
Half Year Results for the six months ended 30 April 2022
Good performance whilst advancing strategy to focus on software businesses
Idox plc (AIM: IDOX, 'Idox', 'the Company' or 'the Group'), a leading supplier
of specialist information management software and solutions to the public and
asset intensive sectors, is pleased to announce its unaudited half year
results for the six months ended 30 April 2022 ('H1 FY22').
Financial highlights
Continuing operations (FY21 comparatives exclude Idox Content businesses
disposed in H1 FY21):
Revenue
· Increased by 7% to £33.2m (H1 FY21: £31.1m), driven by double digit
growth in Public Sector Software.
· Recurring revenues(1) increased by 13% to £19.8m (H1 FY21: £17.6m),
and now account for 60% of the Group's total revenue (H1 FY21: 57%).
Profit
· Adjusted(2) EBITDA increased by 8% to £11.0m (H1 FY21: £10.1m).
· Operating profit increased by 3% to £4.3m (H1 FY21: £4.1m).
· Adjusted(2) EBITDA margin consistent at 33% (H1 FY21: 33%).
· Operating profit margin consistent at 13% (H1 FY21: 13%).
· Statutory profit before tax £3.6m (H1 FY21: £3.7m).
· Adjusted(3) diluted EPS increased by 7% to 1.21p (H1 FY21: 1.13p).
· Statutory diluted EPS increased by 1% to 0.68p (H1 FY21: 0.67p).
Cash
· Net debt(4) reduction of 54% in the period to £3.8m (31 October 2021:
net debt £8.1m; 30 April 2021: net cash £7.6m). Comparatives reflect
disposal of Content businesses which generated net proceeds of £10.7m in H1
FY21, and three acquisitions completed in H2 FY21 with initial net
consideration of £10.5m.
· Significant resources in place to fund M&A, including £35m
revolving credit facility and £10m accordion.
· Cash generated from operating activities before taxation as a
percentage of Adjusted EBITDA for total operations was 122% (H1 FY21: 169%).
Operational highlights
· Order intake of c.£40m, up 15% from H1 FY21, with strong pipeline
underpinning our confidence over the medium term.
· Contract wins and extensions with increased average tenure across both
our Public Sector Software and Engineering Information Management (EIM)
businesses.
· Strong double-digit growth in revenue and profit in Public Sector
Software buoyed by FY21 acquisitions; weaker performance in EIM due to
continued global uncertainties.
· Integration of 2021 acquisitions substantially complete and to plan.
· Continued upscaling of Pune, India, centre of excellence to increase
efficiency, capability, and knowledge sharing.
· Good progress on furthering our M&A pipeline with strengthened
and dedicated team, led by Rob Grubb.
Current trading and outlook
· Combination of recurring revenue and orderbook, in resilient Public
Sector Software markets, provides good revenue visibility for the remainder of
FY22.
· EIM expected to deliver improved H2 FY22 performance.
· The business continues to perform well and in line with the Board's
expectations.
David Meaden, Chief Executive Officer of Idox said:
"We continue to make good progress advancing our strategy to focus on
software. Our software solutions deliver value to our customers through
managing their complex operational, legislative, and regulatory issues, whilst
enabling us to maintain long term relationships with them.
Operationally, the business continues to perform strongly within our 'Four
Pillars' framework. I am particularly pleased with the progress from the
investment we have made in the business; in our people development, notably
our culture of engagement and leadership, organisational design incorporating
our offshore capabilities, improved management information and automation
programmes. All of this has helped deliver an improved quality of revenue,
with strong margins and underlying cash generation.
Further investments in our M&A team, led by Rob Grubb our former CFO, has
created greater focus and opportunity for further expansion through
acquisitions.
The outlook for the business is promising as we continue to improve our
operational capabilities and build momentum in our chosen markets. We are now
firmly focussed on our 'fly phase' which we believe will drive value for our
key stakeholders."
There will be a webcast at 9:00am UK time today for analysts and investors. To
register for the webcast please contact MHP Communications at idox@mhpc.com
(mailto:idox@mhpc.com)
For further information please contact:
Idox plc +44 (0) 870 333 7101
David Meaden, Chief Executive Officer investorrelations@idoxgroup.com
Anoop Kang, Chief Financial Officer
Peel Hunt LLP (NOMAD and Broker) +44 (0) 20 7418 8900
Edward Knight
Paul Gillam
James Smith
MHP Communications + 44 (0) 20 3128 8404
Reg Hoare / Matthew Taylor idox@mhpc.com (mailto:mhpc@idoxgroup.com)
About Idox plc
For more information see www.idoxgroup.com (http://www.idoxgroup.com)
@Idoxgroup
Alternative Performance Measures
These items are excluded from statutory measures of profit to present a
measure of cash earnings from underlying activities on an ongoing basis. This
is in line with management information requested and presented to the decision
makers in our business; and is consistent with how the business is assessed by
our debt and equity providers.
(1) Recurring revenue is defined as revenues recognised from support and
maintenance fees, managed service fees (including for hosting) and
Software-as-a-Service subscription fees.
(2) Adjusted EBITDA is defined as earnings before amortisation, depreciation,
restructuring, acquisition costs, impairment, financing costs and share option
costs. Share option costs are excluded from Adjusted EBITDA as this is a
standard measure in the industry and how management and our shareholders track
performance (see note 11 for reconciliation).
(3) Adjusted EPS excludes amortisation on acquired intangibles, restructuring,
financing, impairment, share option and acquisition costs (see note 11 for
reconciliation).
(4) Net (debt) / cash is defined as the aggregation of cash, bank borrowings
and the long-term bond.
Chair's statement
Introduction
I am pleased to report that the first half of this financial year has once
again seen a robust performance from the Group. During a period in which the
economic environment has become more difficult due to the war in Ukraine, the
lingering effects of the Covid-19 pandemic and the resulting pressure on costs
and talent, it is pleasing to see the business continue to progress so well
and continue to build momentum.
Following a period of corporate activity in the second half of FY21, which saw
the business become increasingly focussed on its software operations, we are
pleased to report continuing Group revenues up 7% on the same period last year
and a growth of 8% at EBITDA. This robust performance also translated into a
strong cash performance, with cash generated from continuing operations,
before tax, being £13.4m, representing a conversion rate of 122% against an
EBITDA for the period of £11.0m.
Once again net debt was considerably reduced, on this occasion by 54% in the
period. The Group is well placed to continue to execute on our growth strategy
supported by selective strategic acquisitions, with £7.1m of available cash
supplemented by our £35m revolving credit facility and £10m accordion.
We are confident in the momentum being built in the business and this is
supported by an increase in order intake over the period of 15%, with a strong
pipeline underpinning our confidence in the medium term.
The markets in which we operate have been the subject of much recent
discussion, particularly around Planning and the ongoing trend in Local
Government for consolidation into larger authorities. Whilst many of the well
trailed Planning Reform activities have not transpired to date, the continued
push for improvements in citizen engagement and the better use of data in
property and infrastructure development strategies are encouraging. These
trends, along with the continuing need for simplicity and cost savings using
advanced technology solutions lead us to believe there will continue to be
good opportunities for the business over the longer term. During the period we
have also seen some good contract wins in the EIM business, which will be
realised in the second half of the year.
We have spoken of our strategy to supplement our existing market offerings
with further targeted acquisitions, and I am pleased that the three
acquisitions we made last year have integrated so well with the business. We
have more to come from enhancing our combined offerings for clients, but we
have made strong progress to date. Since the acquisition of Idox Cloud in
2019, we have generated revenue derived from the areas related to our
regulated offerings of over £7.5m and this bodes well for the companies we
were able to add to the Group last year.
We have increased our focus on further acquisitions and continue to look for
accretive, synergistic opportunities that support the long-term focus on
software and which complement the existing portfolio. We are confident that
there are a range of opportunities that fit the key criteria we have defined,
and we look forward to adding further assets in due course.
During the reporting period we have undertaken work to report our progress in
matters relating to ESG and enhanced our reporting on matters relating to
diversity, equality and inclusivity. In each of these areas our reporting is
now illustrative of the attention the management team place upon these matters
and the culture within the business that seeks to ensure that all
stakeholders, foremost amongst these our employees, can be proud of Idox work
in this area. The Chief Executive's statement includes further information on
our ESG related activities.
Dividend
As previously announced, the Group paid a dividend of 0.4p per share in April
2022 in respect of the year ending 31 October 2021. Our current policy is to
only declare a final dividend and therefore there is no interim dividend in
respect of H1 FY22 (H1 FY21: £Nil). We will keep the level of future
dividends under review in consideration of our financial position and our
confidence in the future.
Board
During the reporting period, Rob Grubb resigned his Board position as Chief
Financial Officer and took up a role as M&A Director for the Group
reporting to the CEO, David Meaden. He was succeeded by Anoop Kang who was
appointed to the Board as CFO on 16 March 2022, having previously held a
number of senior finance roles, including CFO, in a range of well-known
companies.
Summary
The Group has made credible progress with its strategy during the period,
building on the transformation achieved previously. Idox is now a pure
software Group and is well positioned to progress further with the financial
resources at its disposal. The business continues to perform well and in line
with the Board's expectations.
Christopher
Stone
Chair of the
Board
Chief Executive's statement
Building momentum
Our four pillars of Revenue expansion, Margin enhancement, Simplification and
Communication continue to be the platform on which we build and operate the
business. I am pleased to report on another period of strong performance as we
continued to focus on software businesses that deliver value to customers, and
which allow Idox to maintain long term relationships through our proven
ability to manage complex operational, legislative, and regulatory issues.
The three acquisitions made in the second half of FY21 (Aligned Assets,
thinkWhere & exeGesIS) strengthen our position in the area of Planning
Technology and further expanded our capabilities in Address Management and
particularly in Geo-Spatial solutions and services. These acquisitions are now
fully integrated within our sales and operational delivery teams, and we are
already seeing benefits from our combined propositions as well as
opportunities to develop further into near adjacent markets.
We are in a strong financial position to add further customers, technology,
and recurring income through carefully selected M&A, further extending
Idox's position in markets where it is noted for its expertise and insight.
Strong progress
During this reporting period we have seen growth in Group revenues for our
continuing operations of 7%, with accompanying adjusted EBITDA improving by 8%
from £10.1m to £11.0m. Following strong cash generation, we have moved from
a net debt position at 31 October 2021 of £8.1m to a net debt position of
£3.8m.
As our focus has now shifted into our 'fly phase', and given our strong
operational cadence and financial position, we are well placed for growth in
our software operations and have established a solid position from which to
add compatible bolt on acquisitions to our portfolio of offerings.
The 'Four Pillars' programme
Revenue expansion
The Chair of the Board referenced the unsettling economic conditions caused by
the war in Ukraine and the lingering effects of the pandemic. During the
period we demonstrated high resilience as a business and our core areas
performed well. Our strong market positions have allowed us to continue to
sell more to existing clients as we meet their needs, as well as adding new
client accounts. Performance overall has been bolstered by the
transformational activities we have undertaken that have led to better sales
execution and improved integration across the Group, which in turn have
delivered consistent margins and improved bottom-line performance.
Order intake across the Group for the six months ended 30 April 2022 continued
to grow, helping to support the in-year revenue growth and build the future
orderbook. In the period we secured c.£40m of total contract value,
increasing by 15% over the same period last year.
Sales order intake in local government continued to rise, up 13% on the same
period; new wins in H1 FY21 included Rother & Wealden District Council,
Dartmoor National Park Authority and Belfast City Council, choosing to
implement the Idox Cloud Solution. The Idox Cloud business continued to enjoy
good growth in H1 FY22 as planned, with revenues up 7%, whilst its recurring
revenue was up 11% on the same period last year.
In Elections, we saw a very busy first half of the year. A combination of UK
local elections, an election in Malta and the completion of a number of
project deliverables for the Scottish eCount contract resulted in revenues up
17% when compared to the same period in FY21.
Health revenues also increased 9% on the comparable period with consistent
recurring revenue and new sales from our sexual health products. Sales orders
were also up in the period, although we still believe customers have continued
to focus their efforts on managing the after effects of the Covid-19 pandemic.
In the Grants subscription business incorporating GrantFinder &
ResearchConnect, our new product UI (launched last year) has been welcomed by
the market. Revenues were up in the period 6% and sales order intake was also
up over 10% in the period. We also continued support for Charities and
organisations with incomes of less than £30,000 through the "My Funding
Central" solution, providing free access to grants and funding information to
over 3,000 subscribers following the withdrawal of these services by the
National Council Voluntary Organisation.
New business sales in EIM were supported by significant new FusionLive sales
including Lummus Technologies and Transalta, supporting growth in the markets
of Renewables and Construction. Revenues were down in EIM as the business was
affected by uncertainty in some of its markets largely due to the impact of
the global economy and the war in Ukraine.
Margin enhancement
During the period we have substantially grown our operations in India,
expanding our operational footprint to include the areas of HR, Finance and
Professional Services as well as broadening our Development Services there. We
see scope for further expansion throughout the rest of this year and beyond.
Development teams have been successfully restructured, our technology
footprints have been consolidated where possible and we have improved resource
sharing across our teams. Cost savings and efficiencies driven through data
centre consolidation and greater sharing of skills and capabilities across the
software and professional services teams continued to take effect.
Overall, these changes and investments are expected to enhance our long-term
margins.
Simplification
Stratification of the sales teams has provided a greater focus on
communication, renewals and the customer experience and continues to
positively impact customer attrition and the length of contracts.
Continued investment in our internal processes, systems, and the integration
of data across sales, customer services, professional services and finance
ensures that we have consistent customer information, improving all aspects of
our operational performance.
Professional Services utilisation continues to improve, and significant work
has been delivered to improve and simplify the process of data migration
between Idox solutions, thus making the transition of on-premise legacy
platforms to our latest cloud provisioned services shorter and more cost
effective for customers.
Communication
Regular and open communication with all colleagues across the business is a
strategic focus for the Group and is delivered through a number of channels.
We continue to provide regular updates through our CEO broadcasts where
various members of the management team participate to provide a broad range of
insights and inputs to the sessions, including an open Q&A provision for
all colleagues to participate. Our colleagues across the business are highly
engaged and participation levels demonstrate this.
Personally, conducting final conversations with prospective new team members
enables me to outline how we operate and work at Idox, what they can expect
from us and we in turn expect from them. This ensures that we have a well
communicated and understood culture and our ambitions for the business and the
opportunity for individuals to have meaningful careers in a unique company can
be fully aligned from the outset.
Responsible Idox
Conducting business responsibly is core to Idox's business model and long-term
strategic goals. The Board recognises the importance of our environmental and
societal responsibilities in defining and growing the value of our services
and solutions and in building lasting commercial relationships across the
industries and communities in which we operate. Our commitment is focused in
four areas: our people, our communities, our environment, and our
organisational responsibilities. Each of these focus areas addresses relevant
United Nations Sustainable Development Goals.
In FY21 we formed an ESG steering committee, with the core responsibility of
understanding and monitoring how our business practices are sustainable in
environmental and social terms, as well as ensuring Idox is well governed.
This committee has sponsored further initiatives during the first half of FY22
with particular focus on Diversity, Equality and Inclusivity, most notably
with the 'Dare to be Different' survey which was completed during the period.
Response rate from employees was extremely high, demonstrating the levels of
commitment our team have in celebrating our successes whilst also identifying
further opportunities for improvement. Our most recent initiative is the
introduction of 'Employee Lounges' - small virtual meetings to discuss how
these improvements should be made in the most effective way.
Idox recognises the importance of environmental protection and is committed to
operating its business responsibly by operating an Environmental Management
System accredited to BS EN ISO 14001:2015, participating in the Energy Saving
Opportunities Scheme ('ESOS'), and meeting the requirements of the Streamlined
Energy and Carbon Reporting ('SECR') regulations. FY21 saw the introduction of
enhanced reporting of our Scope 1, 2 and 3 emissions disclosures within the
Task Force on Climate-related Financial Disclosures ('TCFD') framework and in
the first half of FY22 we have continued to drive initiatives such as moving
towards electric vehicles for our service operations and maintaining
disciplines on avoiding unnecessary travel as Covid restrictions have been
removed.
Employees continue to use our community days scheme to support good causes in
their local communities and the payroll giving scheme to maximise the impact
of their contributions. The workplace wellbeing sessions also continue to be
very well attended and appreciated by members of the Idox Team.
Outlook
We continue to build momentum with a sharp focus on growing revenues within an
optimised operational structure; this will support good margin performance as
we progress through our 'fly phase' which we believe will drive value for all
our stakeholders.
We are making good progress and our strategy remains unchanged. We are clear
in our view that software provided in the cloud and / or provisioned through
our data centre services across each of our business areas is a strategic
necessity to service the market needs whilst, in turn, growing our recurring
revenue and we continue to invest across the business to facilitate this.
Our good cash generation provides a solid foundation from which to invest in
organic growth whilst initiating complimentary growth through the acquisition
of strategic targets that add to our portfolio of offerings. Overall, our
current full year financial performance is expected to be in line with Board
expectations reflecting our strong order book and consistent operational
execution.
David Meaden
Chief Executive
Officer
Chief Financial Officer's review
Financial review
The first six months of 2022 have built upon the changes implemented in FY21.
We have successfully integrated Aligned Assets and thinkWhere into the Group,
with exeGesIS substantially progressed and planned to complete in the second
half of the year. The acquisitions have proven to be earnings enhancing as
anticipated, contributing towards our 7% increase in continuing revenue to
£33.2m (H1 FY21: £31.1m) and our 8% increase in adjusted EBITDA to £11.0m
(H1 FY21: £10.1m).
The Idox Content business was classified as discontinued following its
disposal in FY21.
The following table sets out the Revenue and Adjusted EBITDA for each of the
Group's segments.
H1 FY22 H1 FY21 Variance
£000 £000 £000 %
Revenue
- Public Sector Software 29,652 26,982 2,670 10%
- Engineering Information Management 3,554 4,148 (594) (14%)
Idox Software 33,206 31,130 2,076 7%
Idox Content (discontinued) - 3,897 (3,897) N/A
Total 33,206 35,027 (1,821) (5%)
Revenue Split
- Public Sector Software 89% 77%
- Engineering Information Management 11% 12%
- Idox Software 100% 89%
- Idox Content (discontinued) - 11%
Adjusted EBITDA(1)
- Public Sector Software 10,679 9,420 1,259 13%
- Engineering Information Management 311 719 (408) (57%)
Idox Software 10,990 10,139 851 8%
Idox Content (discontinued) - 276 (276) N/A
Total 10,990 10,415 575 6%
Adjusted EBITDA Margin Split
- Public Sector Software 36% 35%
- Engineering Information Management 9% 17%
- Idox Software 33% 33%
- Idox Content (discontinued) - 7%
- Total 33% 30%
(1) Adjusted EBITDA is defined as earnings before amortisation, depreciation,
restructuring, acquisition costs, impairment, financing costs and share option
costs. See note 11 for reconciliations of the alternative performance
measures.
Public Sector Software ('PSS') and Engineering Information Management ('EIM')
PSS delivered revenues of £29.7m, an improvement of 10% on the prior year,
while the revenues in EIM have decreased to £3.6m in the period. Within PSS,
the acquisitions made in FY21, contributed £3.2m of revenue. On a 'like for
like' basis the Group delivered £30.0m of revenue, slightly down on the prior
period.
H1 FY22 H1 FY21 Variance
£000 £000 £000 %
Idox Software Revenues
- Recurring (PSS) 16,866 14,508 2,358 16%
- Recurring (EIM) 2,964 3,117 (153) (5%)
19,830 17,625 2,205 13%
- Non-Recurring (PSS) 12,786 12,474 312 3%
- Non-Recurring (EIM) 590 1,031 (441) (43%)
13,376 13,505 (129) (1%)
33,206 31,130 2,076 7%
- Recurring(1) 60% 57%
- Non-Recurring(2) 40% 43%
(1) Recurring revenue is defined as revenues associated with access to a
specific ongoing service, with invoicing that typically recurs on an annual
basis and underpinned by either a multi-year or rolling contract. These
services include Support & Maintenance, SaaS fees, Hosting services, and
some Managed service arrangements which involve a fixed fee irrespective of
consumption.
(2) Non-recurring revenue is defined as revenues without any formal commitment
from the customer to recur on an annual basis.
Total recurring revenue increased by 13% in the period to £19.8m and now
accounts for 60% of the Group's total revenue (H1 FY21: 57%). Recurring
revenues in PSS have increased 16% to £16.9m and have been positively
impacted by the acquisitions in the second half of FY21. In EIM recurring
revenues have decreased by 5% to £3.0m, impacted by certain contracts which
ended in FY21 and were not renewed and a continuation of uncertain market
conditions.
Non-recurring revenues have remained stable at £13.4m for the period and
account for 40% of the Group's revenue. A reduction of £0.4m in EIM has been
offset by improvements in PSS, particularly in the Elections part of the
business.
The Group's order intake for the period was up 15% on last year to c.£40m.
Furthermore, the average tenure of new contracts has increased from 20 months
to 22 months, as the Group focuses on transitioning existing customer
relationships to longer term arrangements, this includes contract wins in both
PSS and EIM. The orderbook for professional services ended the period at
£8.9m, down from £9.8m at 31 October 2021 and as a result of the planned
unwind of Elections contracts.
Adjusted EBITDA increased by 8% to £11.0m (H1 FY21: £10.1m), delivering a
stable EBITDA margin of 33% (H1 FY21: 33%). The improvement in adjusted EBITDA
benefitted from the FY21 acquisitions but was partially offset by reduced
revenues in EIM and the phasing of certain contracts in PSS to the second half
of the year.
We continue with our efforts to improve efficiencies through marginal gains
across our sales, development, professional services and support activities,
and leverage our common resources to drive higher margins through improved
economies of scale.
Profit / (Loss) Before Taxation
The following table provides a reconciliation between adjusted EBITDA and
statutory profit before taxation for continuing operations.
H1 FY22 H1 FY21 Variance
£000 £000 £000 %
Adjusted EBITDA 10,990 10,139 851 8%
Depreciation & Amortisation (5,328) (5,043) (285) 6%
Restructuring costs (119) (160) 41 (26%)
Acquisition costs (11) (6) (5) 83%
Financing costs (30) (29) (1) 3%
Share option costs (1,249) (784) (465) 59%
Net finance costs (651) (462) (189) 41%
Profit before taxation 3,602 3,655 (53) (1%)
The reported profit before tax for continuing operations was £3,602,000 (H1
FY21: £3,655,000).
Restructuring costs are analysed as follows:
H1 FY22 H1 FY21 Variance
£000 £000 £000 %
Corporate restructuring 109 - 109 100%
Litigation - (11) 11 100%
Property 10 - 10 100%
Take over approach - 171 (171) (100%)
Total restructuring costs 119 160 (41) (26%)
Acquisition costs of £11,000 (H1 FY21: £6,000) relates to the final
settlements in relation to the acquisition of Aligned Assets, thinkWhere and
exeGesIS in FY21. The prior year comparative is in relation to Idox Cloud
(formerly Tascomi) in August 2019.
Financing costs of £30,000 (H1 FY21: £29,000) relate to professional fees
incurred as part of the ongoing bank facility agreement.
Share option costs of £1.2m (H1 FY21: £0.8m) relate to the accounting charge
for awards in the current and prior years under the Group's Long-term
Incentive Plan.
Net finance costs have increased to £0.7m (H1 FY21: £0.5m) as a result of
the foreign exchange gain on the revaluation of the euro denominated bond
being lower than in the comparative period and less interest being payable in
respect of the Group's banking facilities.
The Group capitalised £3.1m of development costs during the period (H1 FY21:
£2.2m). £0.7m related to the FY21 acquisitions and £2.4m in respect of the
Group's legacy products. The Group has a number of products which are all at
differing stages of their lifecycle. These platforms require continued
investment to remain operational and current. For example, enhancements
include technical refreshes, functional changes and investment needed to
ensure continued operability.
Taxation
The effective tax rate (ETR) for the period was 17% (H1 FY21: 8%) for total
operations. The ETR for the period for continuing operations was 15% (H1 FY21:
18%). On an adjusted basis the Group's ETR was 20% (H1 FY21: 20%).
The main factors for the reduction in the volatility in the ETR on the profit
before tax position was the disposals in FY21 which resulted in income not
subject to tax, meaning permanent and other differences giving rise to ETR
effects were proportionately lower in the current period. The difference
between the statutory rate of 19% and the adjusted ETR of 20% is due to
certain disallowables, the impact of overseas tax rates and international
losses arising in the period and not recognised.
There are substantial carried-forward losses not recognised for deferred tax
purposes to date, owing to adoption of a prudent loss recognition position.
The gross value of these losses not recognised to date totals £12m, split
across Malta (£9.1m), the UK (£0.6m), and France (£2.3m). The Board is
hopeful that the Group will benefit from the unrecognised tax losses in the UK
and France in the future and these will be recognised at the point where
utilisation becomes more certain.
Earnings per share and dividends
Basic earnings per share for continuing operations improved 3% to 0.70p (H1
FY21: 0.68p) as a result of the Group reporting a larger profit after tax
compared to that in H1 FY21. Diluted earnings per share for continuing
operations improved 1% to 0.68p (H1 FY21: 0.67p).
Adjusted basic earnings per share for continuing operations increased 7% to
1.24p (H1 FY21: 1.16p). Adjusted diluted earnings per share for continuing
operations increased 7% to 1.21p (H1 FY21: 1.13p).
In line with FY21 the Board does not propose an interim dividend in respect of
the six months ended 30 April 2022. We will keep the level of future dividends
under review in consideration of our financial position and our confidence in
the future.
Balance sheet and cashflow
The Group's net assets have increased to £63.1m compared to £60.8m at 31
October 2021. The constituent movements are detailed in the Group's
consolidated Statement of Changes in Equity: which are summarised as follows:
6 months to
30 April 2022
£000
Total Equity as per FY21 Financial Report 60,810
Share option movements 1,221
Equity dividends paid (1,784)
Profit for the period 2,508
Exchange gains on translation of foreign operations 310
Total Equity as per H1 FY22 Financial Report 63,065
The Group continued to have good cash generation in the period. Cash generated
from operating activities before taxation as a percentage of Adjusted EBITDA
for total operations was 122% (H1 FY21: 169%). The reduction in the conversion
rate is primarily due to the settlement of VAT deferrals and exceptional cash
costs in H1 FY22 and the timing of certain other creditor payments falling
into the second half of FY21.
H1 FY22 H1 FY21
£000 £000
Net cashflow from operating activities after taxation 11,127 17,775
Capex (3,588) (3,097)
Lease payments (509) (678)
Free cashflow 7,030 14,000
The Group ended the period with net debt of £3.8m (H1 FY21: net cash of
£7.6m), representing a 54% reduction from the net debt position of £8.1m at
31 October 2021. The net cash position in the prior year reflected the net
cash inflow of £10.7m from the disposal of our Content business, which was
subsequently reinvested in the acquisitions in the second half of the year.
Net debt comprised cash of £21.6m less bank borrowings of £14.5m and the
Maltese listed bond of £10.9m.
In October 2021 the Group extended its revolving credit facility of £35m and
£10m accordion with the Royal Bank of Scotland plc, Silicon Valley Bank and
Santander UK plc for an additional 18 months, to June 2024. The Group also
transitioned from LIBOR to SONIA at this point.
The Group has carefully assessed the ongoing impact of the Covid-19 pandemic
on the business and on our customers. Idox is fundamentally resilient due to
the Group's high recurring revenue base, its focus on public sector markets
and the high proportion of staff that routinely work from home. The Group
retains significant liquidity with cash and available committed bank
facilities and has strong headroom against financial covenants. For this
reason, the Directors continue to adopt the going concern basis in preparing
the financial statements.
Anoop Kang
Chief Financial Officer
Note 6 months to 12 months to
6 months to 30 April 2022 30 April 2021* 31 October 2021
(unaudited) (unaudited) (audited)
£000 £000 £000
Continuing operations
Revenue 3 33,206 31,130 62,185
Cost of sales (8,389) (8,467) (17,130)
Gross profit 24,817 22,663 45,055
Administrative expenses (20,564) (18,546) (37,415)
Operating profit 4,253 4,117 7,640
Analysed as:
Adjusted EBITDA 11 10,990 10,139 19,519
Depreciation & Amortisation (5,328) (5,043) (10,204)
Restructuring costs (119) (160) 90
Acquisition costs (11) (6) 134
Financing costs (30) (29) (110)
Share option costs (1,249) (784) (1,789)
Finance income 219 801 818
Finance costs (870) (1,263) (1,190)
Profit before taxation 3,602 3,655 7,268
Income tax charge 5 (527) (650) (1,237)
Profit for the period from continuing operations 3,075 3,005 6,031
Discontinued operations
(Loss) / profit for the year from discontinued operations 6 (567) 4,284 5,918
Profit for the period attributable to the owners of the parent 2,508 7,289 11,949
Other comprehensive income / (loss) for the period 310 401 (108)
Items that will be reclassified subsequently to profit or loss:
Exchange movement on translation of foreign operations net of tax
Other comprehensive income / (loss) for the period, net of tax 310 401 (108)
Total comprehensive income for the period attributable to owners of the parent 2,818 7,690 11,841
Earnings per share attributable to owners of the parent during the period
From continuing operations
Basic 7 0.70p 0.68p 1.37p
Diluted 7 0.68p 0.67p 1.34p
From continuing and discontinued operations
Basic 7 0.57p 1.66p 2.71p
Diluted 7 0.56p 1.62p 2.65p
Consolidated interim statement of comprehensive income
*The comparatives have been re-presented for a more appropriate reallocation
between cost of sales and administrative expenses as result of the Content
business being reclassified as discontinued operations in the prior period.
There has been no change to the overall results.
The accompanying notes form an integral part of these financial statements.
Note At 30 April At 30 April 2021 (unaudited) At 31 October 2021
2022 (audited)
(unaudited)
£000 £000 £000
Assets
Non-current assets
Property, plant and equipment 1,341 1,179 1,307
Intangible assets 8 91,530 71,386 92,025
Right-of-use-assets 2,000 2,066 2,363
Deferred tax assets 2,133 1,450 2,623
Total non-current assets 97,004 76,081 98,318
Current assets
Trade and other receivables 20,966 20,088 16,968
Current tax receivable 725 - -
Cash and cash equivalents 21,560 29,159 18,283
Total current assets 43,251 49,247 35,251
Total assets 140,255 125,328 133,569
Liabilities
Current liabilities
Trade and other payables 8,404 7,372 8,075
Deferred consideration 2,691 - 2,070
Current tax payable - 126 1,399
Other liabilities 30,928 33,388 23,547
Provisions 853 1,967 1,433
Lease liabilities 563 701 727
Total current liabilities 43,439 43,554 37,251
Non-current liabilities
Deferred tax liabilities 6,256 3,445 5,579
Deferred consideration - - 841
Lease liabilities 1,454 1,485 1,747
Other liabilities 727 934 949
Bonds in issue 10,848 11,364 10,998
Borrowings 14,466 10,207 15,394
Total non-current liabilities 33,751 27,435 35,508
Total liabilities 77,190 70,989 72,759
Net assets 63,065 54,339 60,810
Equity
Called up share capital 4,511 4,463 4,469
Capital redemption reserve 1,112 1,112 1,112
Share premium account 41,556 41,466 41,556
Treasury reserve (594) (594) (594)
Share option reserve 3,673 3,068 3,962
Other reserves 8,789 7,528 8,789
ESOP trust (445) (379) (417)
Foreign currency translation reserve 121 320 (189)
Retained earnings / (accumulated losses) 4,342 (2,645) 2,122
Equity attributable to the owners of the parent 63,065 54,339 60,810
Consolidated interim balance sheet
The financial statements were approved by the Board of Directors and
authorised for issue and are signed on its behalf by:
David Meaden
Anoop Kang
Chief Executive
Officer
Chief Financial Officer
The accompanying notes form an integral part of these financial statements.
Share Foreign currency translation reserve Retained earnings / (accumu-lated losses)
Called up share capital Capital redemption premium Share Other £000 £000 Total
£000 reserve account Treasury reserve options reserves ESOP £000
£000 £000 £000 reserve £000 trust
£000 £000
Balance at 1 November 2020 (audited) 4,450 1,112 41,356 (621) 2,618 7,528 (373) (161) (8,951) 46,958
Issue of share capital 13 - 110 - - - - - - 123
Share option charge - - - - 893 - - - - 893
Exercise / lapses of share options - - - 27 (443) - - - 428 12
ESOP trust - - - - - - (6) - - (6)
Equity dividends paid - - - - - - - - (1,331) (1,331)
Transactions with owners and non-controlling interests 13 - 110 27 450 - (6) - (903) (309)
Profit for the period - - - - - - - - 7,289 7,289
Other comprehensive income
Recycled exchange movements on disposal of subsidiaries - - - - - - - 80 (80) -
Exchange movement on translation of foreign operations - - - - - - - 401 - 401
Total comprehensive loss for the period - - - - - - - 481 7,209 7,690
At 30 April 2021 (unaudited) 4,463 1,112 41,466 (594) 3,068 7,528 (379) 320 (2,645) 54,339
Issue of share capital 6 - 90 - - - - - - 96
Share options charge - - - - 1,001 - - - - 1,001
Exercise / lapses of share options - - - - (107) - - - 107 -
ESOP trust - - - - - - (38) - - (38)
Fair value of deferred consideration shares on purchase of subsidiary - - - - - 1,261 - - - 1,261
Transactions with owners 6 - 90 - 894 1,261 (38) - 107 2,320
Profit for the period - - - - - - - - 4,660 4,660
Other comprehensive income
Exchange movement on translation of foreign operations - - - - - - - (509) - (509)
Total comprehensive profit for the period - - - - - - - (509) 4,660 4,151
Balance at 31 October 2021 (audited) 4,469 1,112 41,556 (594) 3,962 8,789 (417) (189) 2,122 60,810
Issue of share capital 42 - - - - - - - - 42
Share option charge - - - - 1,207 - - - - 1,207
Exercise / lapses of share options - - - - (1,496) - - - 1,496 -
ESOP trust - - - - - - (28) - - (28)
Equity dividends paid - - - - - - - - (1,784) (1,784)
Transactions with owners 42 - - - (289) - (28) - (288) (563)
Profit for the period - - - - - - - - 2,508 2,508
Other comprehensive loss
Exchange movement on translation of foreign operations - - - - - - - 310 - 310
Total comprehensive profit for the period - - - - - - - 310 2,508 2,818
At 30 April 2022 (unaudited) 4,511 1,112 41,556 (594) 3,673 8,789 (445) 121 4,342 63,065
Consolidated interim statement of changes in equity
The accompanying notes form an integral part of these financial statements.
Consolidated interim cash flow statement
Note
6 months to 6 months to 12 months to
30 April 2022 30 April 2021 (unaudited) 31 October 2021 (audited)
(unaudited)
£000 £000 £000
Cash flows from operating activities
Profit for the period before taxation 3,035 7,935 13,186
Adjustments for:
Depreciation of property, plant and equipment 371 467 801
Depreciation of right-of-use assets 363 610 1,021
Amortisation of intangible assets 4,594 4,420 8,835
Loss / (gain) on disposal of subsidiary 6 567 (4,592) (6,679)
Finance income (199) (801) (800)
Finance costs 810 1,205 1,060
Debt issue costs amortisation 60 73 144
Research and development tax credit (161) (100) (267)
Share option costs 1,249 903 1,908
Movement in receivables (4,428) (2,879) 3,086
Movement in payables 7,177 10,386 (5,947)
Cash generated by operations 13,438 17,627 16,348
(Tax paid) / tax refunded (2,311) 148 206
Net cash from operating activities 11,127 17,775 16,554
Cash flows from investing activities
Acquisition of subsidiaries (651) - (10,530)
Disposal of subsidiaries (148) 10,730 10,669
Gain on sale of property, plant and equipment 11 - -
Purchase of property, plant and equipment (404) (790) (1,110)
Purchase of intangible assets (3,184) (2,307) (4,637)
Finance income 37 19 66
Net cash from / (used in) investing activities (4,339) 7,652 (5,542)
Cash flows from financing activities
Interest paid (227) (363) (967)
New loans 2,500 5,000 15,600
Loan related costs (76) - (292)
Loan repayments (3,600) (30,000) (35,000)
Principal lease payments (509) (678) (1,154)
Equity dividends paid (1,784) (1,331) (1,331)
(Purchase) / issue of own shares (51) 69 64
Net cash outflows from financing activities (3,747) (27,303) (23,080)
Net movement in cash and cash equivalents 3,041 (1,876) (12,068)
Cash and cash equivalents at the beginning of the period 18,283 30,812 30,812
Exchange gains / (losses) on cash and cash equivalents 236 223 (461)
Cash and cash equivalents at the end of the period 21,560 29,159 18,283
The accompanying accounting policies and notes form an integral part of these
financial statements.
Notes to the interim accounts
1 General information
Idox plc is a leading supplier of software and services for the management of
Local Government and other organisations. The Company is a public limited
company, limited by shares, which is listed on the AIM Market of the London
Stock Exchange and is incorporated and domiciled in the UK. The address of its
registered office is 2nd Floor, 1310 Waterside, Arlington Business Park,
Theale, Reading, RG7 4SA. The registered number of the Company is 03984070.
There is no ultimate controlling party.
The financial statements are prepared in pounds sterling.
2 Basis of preparation
The financial information for the period ended 30 April 2022 set out in this
interim report does not constitute statutory accounts as defined in Section
434 of the Companies Act 2006. The Group's statutory financial statements for
the year ended 31 October 2021 have been filed with the Registrar of
Companies. The auditor's report on those financial statements was unqualified.
The interim financial information has been prepared using the same accounting
policies and estimation techniques as will be adopted in the Group financial
statements for the year ending 31 October 2022. The Group financial statements
for the year ended 31 October 2021 were prepared in accordance with
international accounting standards in conformity with the requirements of the
Companies Act 2006 and International Financial Reporting Standards (IFRS)
adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European
Union. They were also prepared in accordance with International Financial
Reporting Standards as issued by the IASB. These interim financial statements
have been prepared on a consistent basis and format. The Group has not applied
IAS 34 'Interim Financial Reporting', which is not mandatory for AIM
companies, in the preparation of these interim financial statements.
Going concern
The Directors, having made suitable enquiries and analysis of the accounts,
consider that the Group has adequate resources to continue in business for the
foreseeable future. In making this assessment, the Directors have considered
the Group's budget, cash flow forecasts, available banking facility with
appropriate headroom in facilities and financial covenants, and levels of
recurring revenue.
In December 2019 the Group had refinanced with the Royal Bank of Scotland plc,
Silicon Valley Bank and Santander UK plc. The facilities, which comprise a
revolving credit facility of £35,000,000, were extended in October 2021 and
are committed until June 2024.
Idox along with most companies has been impacted by the Covid-19 pandemic,
however the impact on our Group has in the main been limited to the initial
disruption of the early stages of the emerging challenges in 2020, including
restrictions on physical movement. We have largely seen our operations return
to their pre-Covid 19 pandemic levels across our Group.
We remain cautious in respect of the ongoing impact of the Covid-19 pandemic
and associated restrictions but are confident we are fundamentally resilient
due to the Group's high recurring revenue base, its focus on public sector
markets and the high proportion of staff that routinely work from home. The
Group retains significant liquidity with cash and available committed bank
facilities and has strong headroom against financial covenants.
On the basis of the above considerations, the Directors have a reasonable
expectation that the Group will have adequate resources to continue in
business for the foreseeable future and therefore continue to adopt the going
concern basis in preparing the interim financial statements.
3 Segmental analysis
During the period ended 30 April 2022, the Group was organised into two
operating segments which are detailed below.
Financial information is reported to the chief operating decision maker, which
comprises the Chief Executive Officer and the Chief Financial Officer, monthly
with revenue and operating profits split by business unit. Each business unit
is deemed an operating segment as each offers different products and services.
· Idox Software: Public Sector Software (PSS) - delivering
specialist information management solutions and services to the public sector.
· Idox Software: Engineering Information Management (EIM) -
delivering engineering document management and control solutions to asset
intensive industry sectors.
During the six months ended 30 April 2021 the Group disposed of its
Continental Compliance operations and its Netherlands Grants Consultancy
operations, which together comprised the Idox Content segment. As Idox Content
was a separately identifiable division the results for the period ended 30
April 2022 and comparative period have been classified as a discontinued
operation.
Segment revenue comprises sales to external customers and excludes gains
arising on the disposal of assets and finance income. Segment profit reported
to the Board represents the profit earned by each segment before the
allocation of taxation, Group interest payments and Group acquisition costs.
The assets and liabilities of the Group are not reviewed by the chief
operating decision maker on a segment basis. The Group does not place reliance
on any specific customer and has no individual customer that generates 10% or
more of its total Group revenue.
The segment results for the six months to 30 April 2022 were:
PSS EIM Continuing operations total Discontinued operations Content Total
£000 £000 £000 £000 £000
Revenue 29,652 3,554 33,206 - 33,206
Adjusted EBITDA (note 11) 10,679 311 10,990 - 10,990
Depreciation & Amortisation (4,698) (630) (5,328) - (5,328)
Restructuring costs (44) (75) (119) - (119)
Acquisition costs (11) - (11) - (11)
Share option costs (1,060) (189) (1,249) - (1,249)
Segment operating profit 4,866 (583) 4,283 - 4,283
Financing costs (30) - (30)
Operating profit 4,253 - 4,253
Loss from sale of discontinued operations - (567) (567)
Finance income 219 - 219
Finance costs (870) - (870)
Profit before tax 3,602 (567) 3,035
The corporate recharge to the business unit is allocated on a head count
basis.
The segment results for the six months to 30 April 2021 were:
PSS EIM Continuing operations total Discontinued operations Content Total
£000 £000 £000 £000 £000
Revenue 26,982 4,148 31,130 3,897 35,027
Adjusted EBITDA (note 11) 9,420 719 10,139 276 10,415
Depreciation & Amortisation (4,778) (265) (5,043) (454) (5,497)
Restructuring costs (127) (33) (160) - (160)
Acquisition costs (6) - (6) - (6)
Share option costs (771) (13) (784) (119) (903)
Segment operating profit / (loss) 3,738 408 4,146 (297) 3,849
Financing costs (29) - (29)
Operating profit 4,117 (297) 3,820
Gain from sale of discontinued operations - 4,592 4,592
Finance income 801 - 801
Finance costs (1,263) (15) (1,278)
Profit before tax 3,655 4,280 7,935
The segment revenues by geographic location were as follows:
Continuing Discontinued Total Group
£000 £000 £000
H1 FY22: Revenues from external customers:
United Kingdom 29,546 - 29,546
North America 2,008 - 2,008
Europe 1,407 - 1,407
Rest of World 245 - 245
33,206 - 33,206
Continuing Discontinued Total Group
£000 £000 £000
H1 FY21: Revenues from external customers:
United Kingdom 26,679 46 26,725
North America 2,836 27 2,863
Europe 1,149 3,824 4,973
Rest of World 466 - 466
31,130 3,897 35,027
4 Dividends
During the period a dividend was paid in respect of the year ended 31 October
2021 of 0.4p per ordinary share at a total cost of £1,784,000 (H1 FY21: 0.3p
per ordinary share at a total cost of £1,331,000).
The directors do not propose a dividend in respect of the interim period ended
30 April 2022 (H1 FY21: £Nil).
5 Tax on profit on ordinary activities
Continuing operations 6 months to 6 months to 12 months to
30 April 2022 (unaudited) 30 April 2021 (unaudited) 31 October 2021
(audited)
£000 £000 £000
Current tax
UK corporation tax on profit / loss for the year 361 1,116 2,406
Foreign tax on overseas companies - 294 145
Under / (over) provision in respect of prior periods 43 (53) (30)
Total current tax 404 1,357 2,521
Deferred tax
Origination and reversal of timing differences 11 (723) (1,553)
Adjustment for rate change (12) 16 826
Adjustments in respect of prior periods 124 - (577)
Other - - 20
Total deferred tax 123 (707) (1,284)
Total tax charge 527 650 1,237
Total operations 6 months to 6 months to 12 months to
30 April 2022 (unaudited) 30 April 2021 (unaudited) 31 October 2021
(audited)
£000 £000 £000
Current tax
UK corporation tax on profit / loss for the year 361 1,136 2,406
Foreign tax on overseas companies - 294 145
Under / (over) provision in respect of prior periods 43 (88) (30)
Total current tax 404 1,342 2,521
Deferred tax
Origination and reversal of timing differences 11 (712) (1,553)
Adjustment for rate change (12) - 826
Adjustments in respect of prior periods 124 16 (577)
Other - - 20
Total deferred tax 123 (696) (1,284)
Total tax charge 527 646 1,237
Unrelieved trading losses of £1,217,000 remain available to offset against
future taxable trading profits (excluding unrecognised losses of £549,249 in
the UK and £11,480,717 overseas).
6 Discontinued operations
During the six months ended 30 April 2021, the Group received separate offers
to acquire its Continental Compliance operations, and its Netherlands Grants
Consultancy operations. These operations collectively comprised the Idox
Content division of the Group. These offers were at an acceptable valuation
and given the Group's desire to prioritise capital on its Idox Software
operation, these disposals were completed in the period.
The Continental Compliance operations were disposed on 12 March 2021 and the
Netherlands Grants Consultancy operations were disposed on 6 April 2021. These
dates represent the point the control and legal ownership of these operations
passed to the acquirers.
The results of the discontinued operations, which have been excluded in the
consolidated income statement, were as follows:
6 months to 30 April 2022 (unaudited) 6 months to 30 April 2021 (unaudited) 12 months to
31 October 2021 (audited)
£000 £000 £000
Revenue - 3,897 3,897
Expenses - (4,209) (4,218)
(Loss) / gain on disposal (567) 4,592 6,239
Profit before tax (567) 4,280 5,918
Attributable tax expense - 4 -
Net (loss) / profit attributable to discontinued operations (567) 4,284 5,918
During the period, Content contributed £0.6m (H1 FY21: £0.1m) to the Group's
net operating cash flows and contributed (£0.1m) (HY21 H1: £10.7m) in
respect of investing and financing activities.
7 Earnings per share
The earnings per share is calculated by reference to the earnings attributable
to ordinary shareholders divided by the weighted average number of shares in
issue during each period, as follows:
Continuing operations 6 months to 6 months to 12 months to
30 April 2022 30 April 2021 31 October 2021
(unaudited) (unaudited) (audited)
Profit for the period (£000) 3,075 3,005 6,031
Basic earnings per share
Weighted average number of shares in issue 441,605,209 439,472,715 440,376,576
Basic earnings per share 0.70p 0.68p 1.37p
Weighted average number of shares in issue 441,605,209 439,422,715 440,376,576
Add back:
Dilutive share options 10,214,904 9,809,942 10,749,077
Weighted average allotted, called up and fully paid share capital 451,820,113 449,232,657 451,125,653
Diluted earnings per share
Diluted earnings per share 0.68p 0.67p 1.34p
Adjusted earnings per share 6 months to 6 months to 12 months to
30 April 2022 30 April 2021 31 October 2021
(unaudited) (unaudited) (audited)
Adjusted profit for the period (£000) (see note 11) 5,483 5,081 10,252
Weighted average number of shares in issue - basic 441,605,209 439,422,715 440,376,576
Weighted average number of shares in issue - diluted 451,820,113 449,232,657 451,125,653
Adjusted basic earnings per share 1.24p 1.16p 2.33p
Adjusted diluted earnings per share 1.21p 1.13p 2.27p
Total operations 6 months to 6 months to 12 months to
30 April 2022 30 April 2021 31 October 2021
(unaudited) (unaudited) (audited)
Profit for the period (£000) 2,508 7,289 11,949
Basic earnings per share
Weighted average number of shares in issue 441,605,209 439,422,715 440,376,576
Basic earnings per share 0.57p 1.66p 2.71p
Weighted average number of shares in issue 441,605,209 439,422,715 440,376,576
Add back:
Dilutive share options 10,214,904 9,809,942 10,749,077
Weighted average allotted, called up and fully paid share capital 451,820,113 449,232,657 451,125,653
Diluted earnings per share
Diluted earnings per share 0.56p 1.62p 2.65p
8 Intangibles
Goodwill Customer relationships Trade names Software Development costs Total
£000 £000 £000 £000 £000 £000
At 31 October 2021 50,901 15,228 2,626 10,945 12,325 92,025
Additions - - - 70 3,114 3,184
Fair Value Adjustment 915 - - - - 915
Amortisation - (757) (223) (1,320) (2,294) (4,594)
At 30 April 2022 51,816 14,471 2,403 9,695 13,145 91,530
No impairment charge was incurred during H1 FY22 (H1 FY21: £Nil).
9 Long-term incentive plan (LTIP)
During the period, 5,462,258 options were granted under the LTIP.
The Group recognised a total charge of £1,249,211 (H1 FY21: £892,622) for
equity-settled share-based payment transactions related to the LTIP during the
period. The total cost was in relation to outstanding share options and share
options granted in the year.
The number of options in the LTIP scheme is as follows:
30 April 2022 30 April 2021 31 October 2021
No. No. No.
Outstanding at the beginning of the period 15,557,052 12,435,871 12,435,871
Granted 5,462,258 3,387,735 4,800,709
Forfeited - (265,345) (265,345)
Exercised (4,182,312) (999,428) (1,414,183)
Outstanding at the end of the period 16,836,998 14,558,833 15,557,052
Exercisable at the end of the period 4,722,051 4,941,749 5,301,163
10 Post balance sheet events
There have been no post balance sheet events which had a material impact on
the Group.
11 Alternative Performance Measures
Where relevant, adjusted measures of profit have been used alongside statutory
definitions. The main items that are added back to statutory profit are:
amortisation from acquired intangible assets, impairment, restructuring costs,
acquisition & financing costs and share option costs. These items are
excluded from statutory measures of profit to present a measure of cash
earnings from underlying activities on an ongoing basis. This is in line with
management information requested and presented to the decision makers in our
business; and is consistent with how the business is assessed by our providers
of capital.
The following tables set out the Alternative Performance Measures in respect
of continuing operations:
Continuing operations 6 months to 30 April 2022 (unaudited) 6 months to 30 April 2021 (unaudited) 12 months to 31 October 2021
£000's £000's £000's
Adjusted EBITDA:
Profit before taxation 3,602 3,655 7,268
Add back:
Depreciation & Amortisation 5,328 5,043 10,204
Restructuring costs 119 160 (90)
Acquisition costs 11 6 (134)
Financing costs 30 29 110
Share option costs 1,249 784 1,789
Net finance costs 651 462 372
Adjusted EBITDA 10,990 10,139 19,519
Free cashflow:
Net cashflow from operating activities 11,127 17,775 16,554
Capex (3,588) (3,097) (5,747)
Lease payments (509) (678) (1,154)
Free cashflow 7,030 14,000 9,653
Net debt / (cash):
Cash (21,560) (29,159) (18,283)
Bank borrowings 14,466 10,207 15,394
Bonds in issue 10,848 11,364 10,998
Net debt / (cash) 3,754 (7,588) 8,109
Adjusted profit for the period and adjusted earnings per share:
Profit for the period 3,075 3,005 6,031
Add back:
Amortisation from acquired intangibles 1,881 1,737 3,561
Restructuring costs 119 160 (90)
Acquisition costs 11 6 (134)
Financing costs 30 29 110
Share option costs 1,249 784 1,789
Tax rate changes - - 826
Tax effect (882) (640) (1,841)
Adjusted profit for the period 5,483 5,081 10,252
Weighted average number of shares in issue - basic 441,605,209 439,422,715 440,376,576
Weighted average number of shares in issue - diluted 451,820,113 449,232,657 451,125,653
Adjusted basic earnings per share 1.24p 1.16p 2.33p
Adjusted diluted earnings per share 1.21p 1.13p 2.27p
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