REG - Mind Gym PLC - Half Year Results
02/12/2022 07:00
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RNS Number : 3544I Mind Gym PLC 02 December 2022
02 December 2022
Mind Gym PLC
("Mind Gym", the "Group" or the "Company")
Half year results for the six months ended 30 September 2022
Significant H1 momentum driving growth
MindGym (AIM: MIND), the global provider of human capital and business
improvement solutions, announces its half year results for the six months
ended 30 September 2022.
Key Financials
6 months to 30 Sept 2022 6 months to 30 Sept 2021 12 months to 31 Mar 2022 (FY22) Change (H1 FY23 v H1 FY22)
(H1 FY23) (H1 FY22)
Revenue £26.8m £24.1m £48.7m +11%
US Revenue £16.7m £13.9m £29.0m +20%
EMEA Revenue £10.1m £10.3m £19.7m -2%
Digitally enabled(1 2) revenue £18.9m £20.3m £38.4m -7%
Gross profit margin 87.5% 85.9% 87.1% +1.6pps
Statutory profit/(loss) before tax £0.6m £17k £(0.5m) n/m
EBITDA £1.9m £0.7m £1.2m +271%
Diluted EPS 0.84p (0.01p) 1.59p n/m
Cash at bank £4.5m £12.0m £10.0m -62%
Capital Expenditure £2.2m £2.8m £6.1m -21%
(1)Digitally enabled revenue comprises revenue from our digital products and
revenue from delivery of virtual sessions.
(2) Historic balances have been re-stated to include programme management and
cancellation fees related to digitally enabled revenues. Virtual delivery
revenues below have also been re-stated to include these fees
Overview - financial summary H1 FY23
· Results in line with management's expectations - H1 FY23 has seen
growth on H1 FY22, in both constant and actual currency ('FX') rates, despite
the economic uncertainty and exit from Omicron at the start of FY23. FX
benefited revenue growth by circa +9%
· As anticipated, there was a switch back to in-person delivery
after COVID, and this meant that Digitally-enabled revenues decreased 7% on
prior year:
o In-person deliveries grew from 4% in H1 FY22 to 15% of delivery revenue in
H1 FY23. MindGym's business model can flex between in-person and Digital
delivery as needed
o Digitally-enabled revenues represented 71% of total revenue (H1 FY22: 84%)
o On demand digital product revenues grew 3% to £2.8m (H1 FY22: £2.7m),
representing 11% of total revenue (H1 FY22:11%)
· Repeat revenue(3) remained strong at 87% of Group revenue
· Gross margin increased by 1.6 percentage points from H1 FY22 to
87.5% due to the higher mix of Design and Advisory ('D&A') revenues where
related costs are included within administrative expenses
· Staff costs have increased by 6% to £17.2m, largely reflecting
wage inflation
· Profit before tax of £0.6m (H1 FY22: £17k) is in line with
Board expectations. This includes an incremental £0.5m of amortisation
related to Performa, which had not commenced in H1 FY22
· Cash balance at 30 September 2022 of £4.5m (31 March 2022:
£10.0m). The movement includes:
o £2.2m of capital investments
o £1.6m decrease in trade and other payables, reflecting primarily the
impact of bonus and commission timings
o a £3.5m increase in trade and other receivables; we expect much of this
receivables increase to unwind in H2 FY23, resulting in an improvement in cash
conversion and cash position
· The Group retains a £10m debt facility (£6m RCF, £4m
accordion) which matures after three years, providing additional flexibility
if required. The facility remains undrawn as at 2 December 2022
· The Board continues to prioritise investment for growth in
digital over the coming years, and therefore no interim dividend will be paid
for the period ended 30 September 2022. Once the Board has greater clarity on
the performance of its digital investments, and of the broader economic
outlook, we will revisit our dividend policy
Overview - operational summary H1 FY23
New client framework agreements(4)
o Secured a number of significant framework agreements during H1 FY23,
including our largest ever, with a global energy company, with revenues
forecast to be in excess of £10m over the next 24 months
o Other framework agreements, each between £1m-£3m, are also expected to
drive revenues in H2 FY23 and FY24
Accelerated innovation
o Continued strategy of investing in innovation to drive growth through
market-leading research and products
o The Leadership Point of View ('POV') was launched at the end of FY22, with
the related whitepaper launched in H1 FY23.
o Our new Wellbeing POV ('Wellworking') was launched during H1 FY23; the
whitepaper will be published in Q4 FY23, when we also be launching five new
Wellworking live and eWorkout products
o The 'Precision Coaching' whitepaper (MindGym's proprietary coaching
methodology), is being launched in January 2023, and will drive interest in
Performa, MindGym's digital 1:1 coaching SAAS platform.
Digital development
o Performa continues to receive positive early feedback
o Continued enhancements to the Performa platform user experience and the
portfolio of c.100 eWorkouts
o Beta trials of the new Organisational Diagnostics solution start in H2
FY23 which covers culture, DEI, wellbeing and leadership
(3)Repeat revenue is defined as revenue from clients that have purchased
products and services in one or more of the previous three years.
(4) MindGym defines framework agreements as client projects, normally
involving substantial levels of client investment over time. These often
include separate, but related, stages of work. In most scenarios, the service
provider will deliver all of the stages, but these are unlocked over the life
of the framework.
Current Trading & Outlook
· MindGym's outlook for the full year remains unchanged, despite
the impact of economic headwinds, notably in the US
· Second half growth includes the benefit of the large corporate
frameworks
Octavius Black, Chief Executive Officer of Mind Gym, said:
We are encouraged by our first half performance and the significant momentum
going into the second half, as a result of securing our largest ever framework
agreement. In a volatile economic environment with a tight labour market,
MindGym is increasingly well placed as the 'go to' partner to address the
talent challenges that all organisations struggle to resolve.
Our investment in innovation and digital continues to deliver. New
publications on leadership, coaching and wellbeing will set the agenda and
equip our clients to invest in ways that transform their business in half the
time and for a fraction of the cost. Our development of the Performa
platform will build momentum for our new 1:1 coaching service in FY24, and our
new organisational diagnostics solution, currently in beta trials, which
furthers our objective to be the primary strategic partner providing an end-to
end service for our clients.
Enquiries:
Mind Gym plc +44 (0)20 7376 0626
Octavius Black, Chief Executive Officer
Dominic Neary, Chief Financial Officer
( )
Liberum (Nominated Adviser and Sole Broker) +44 (0)20 3100 2000
Nick How
Edward Mansfield
Cara Murphy
MHP Group (for media enquiries) +44 (0)20 3128 8004
Reg Hoare mindgym@mhpgroup.com
Katie Hunt
Veronica Farah
About Mind Gym
Mind Gym is a company that delivers business improvement solutions using
scalable, proprietary products which are based on behavioural science. The
Group operates in three global markets: business transformation, human capital
management and learning & development.
Mind Gym is quoted on the London Stock Exchange Alternative Investment Market
(ticker: MIND) and headquartered in London. The business has offices in
London, New York and Singapore.
Further information is available at www.themindgym.com
Half Yearly report
Business overview
Revenues in H1 FY23 increased 11% on H1 FY22, reflecting underlying growth and
the benefit of currency (FX) tailwinds. Whilst the US grew at 20% in the
period, EMEA revenues have declined by 2% although this reflects some EMEA
managed sales which were delivered, and therefore reported, in the US. MindGym
works with 64% of the FTSE 100 and 57% of the S&P100.
Repeat revenue remained robust at 87%, in line with FY22 full year, slightly
down on H1 FY22 (92%).
MindGym has won a number of significant framework agreements during H1 FY23,
including its largest ever in respect of a global energy company, as well as a
number of others each between £1m-£3m, which are expected to drive revenues
in H2 FY23 and through FY24
Revenue from the Group's top 25 clients contributed 40% of revenue which is
down from the 47% seen for the same period in FY22, reflecting a broadening of
our client base.
Digitally-enabled revenue decreased 7% on prior year levels to £18.9m, (H1
FY22: £20.3m) to represent 71% of total revenue (H1 FY22: 84%), driven by the
anticipated growth of in-person deliveries which grew from 4% in H1 FY22 to
15% of delivery revenue in H1 FY23. MindGym's business model can flex between
in-person and Digital delivery as needed. Existing on demand digital product
revenue grew by 3% to £2.8m (H1 FY22: £2.7m) to represent 11% of total
revenue (H1 FY22: 11%).
We continue to invest for growth through accelerated innovation and digital
development:
· Our investment since FY20 has increased the pace of our
innovation. The Leadership POV has been successfully launched, and Wellbeing
("Wellworking") was launched in H1 FY23, with significant interest from our
clients. The related whitepaper on Wellbeing ("Wellworking") and five new live
products and eWorkouts on this PoV will be launched in Q4 FY23
· The 'Precision Coaching' whitepaper (MindGym's proprietary
coaching methodology), which will drive interest in Performa, MindGym's
digital 1:1 coaching SAAS platform, is being launched in January 2023
· Performa continues to receive positive early feedback and we
anticipate momentum building over the next 12-24 months. We will also launch a
new organisational diagnostics solution for culture, DEI, wellbeing and
leadership, with Beta trials starting in H2 FY23; and enhancements to the
eWorkouts solutions in the second half of this financial year
Financial Performance
Revenue in H1 FY23 increased 11% (2% on a constant currency basis) on H1 FY22
to £26.8m (H1 FY22: £24.1m):
· In EMEA, revenue decreased by 2% to £10.1m (H1 FY22: £10.3m),
representing 38% of total revenue. EMEA revenues have been reduced by EMEA
managed sales which were delivered, and therefore reported, in the US. Revenue
from the top 25 clients decreased to 59% of regional revenue (H1 FY22: 66%),
reflecting the broadening of the client base
· In the US, revenue increased by 20% (4% on a constant currency
basis) to £16.7m (H1 FY22: £13.9m), representing 62% of total revenue.
Revenue from the top 25 clients was broadly flat at 54% of regional revenue
(H1 FY22: 55%)
Revenue from digital products in H1 FY23 was £2.8m (H1 FY22: £2.7m),
representing 11% of total revenue (H1 FY22: 11%). Digitally-enabled revenue
(including workouts delivered virtually) decreased by 7% to £18.9m (H1 FY22:
£20.3m), representing 71% of total revenue (H1 FY22: 84%), due to some switch
back to in-person deliveries after COVID.
Gross profits margins at 87.5% are up 1.6 percentage points up on prior year.
This largely reflects the growth of D&A work in the period, in part
supporting the significant framework agreements that are being won; this will
result in significant revenues over H2 FY23 and FY24. Whilst we have seen cost
of sales increases driven by the increased share of in-person delivery, these
are more than offset (in absolute terms) by the higher prices of in-person
delivery.
Overheads of £22.7m in the period increased by 10% (H1 FY22: £20.6m),
reflecting wage inflation and the carryover of headcount increases in FY22
with salary costs increasing 6% and average headcount increasing 2% to 324 (H1
FY22: 319). The price increases implemented in the year, coupled with
operational efficiencies, have more than offset the wage inflation we have
seen. Share based payments were £28k in the period (H1 FY22: £0.3m),
impacted by the reversal of historic charges due to attrition. Awards to
management, including relevant performance conditions, were granted in July
2022.
Profit before tax in the period was £0.6m (H1 FY22: £17k); this includes an
incremental £0.5m of amortisation related to Performa, which had not
commenced in H1 FY22.
Basic earnings per share in the period were 0.85 pence (H1 FY22: loss of -0.01
pence). Diluted earnings per share were 0.84 pence (H1 FY22: -0.01 pence).
The Group continued to invest in its new digital products with £2.1m (H1
FY22: £2.4m) capitalised during the period, which meets the definition of
development costs under IAS 38, "Intangible assets". Total intangible assets
were valued at £9.8m at 31 September 2022. A further £0.1m was capitalised
in tangible assets in the period relating to IT equipment and office fixtures
and fittings.
The balance sheet remains secure with no bank debt; cash at bank at 30
September was £4.5m, a reduction of £5.5m from the year-end balance at 31
March 2022 of £10.0m. This was due predominantly to £2.2m capital
expenditure, a £1.6m decrease in trade and other payables related to the
impact of bonus/commission timings, and a £3.5m increase in trade and other
receivables; we expect much of this receivables increase to unwind in H2 FY23,
resulting in an improvement in cash conversion and cash position. Overdue debt
has reduced to 9% of trade debtors from 10% in H1 FY22.
The Group retains a £10m debt facility (£6m RCF, £4m accordion) which
matures after three years, providing additional flexibility if required. The
facility remains undrawn as at 2 December 2022.
Overall net assets increased by £1.7m to £21.3m in the six months to 30
September 2022.
Dividend
The Board continues to prioritise investment for growth over the coming years,
and therefore no interim dividend will be paid for the period ended 30
September 2022. The dividend policy is reviewed annually.
Outlook
MindGym's outlook for the full year remains unchanged, despite the impact of
economic headwinds, notably in the US.
Second half growth includes the benefit of large corporate frameworks.
Octavius Black
Chief Executive Officer
Dominic Neary
Chief Financial Officer
MIND GYM PLC CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
6 months to 6 months to Year to
30 Sept 30 Sept 31 March
2022 2021 2022
(Unaudited) (Unaudited) (Audited)
Note £'000 £'000 £'000
Revenue 3 26,759 24,142 48,668
Cost of sales (3,344) (3,418) (6,284)
Gross profit 23,415 20,724 42,384
Administrative expenses (22,749) (20,645) (42,733)
666 79 (349)
Operating profit/(loss)
5 27 9 19
Finance income
Finance costs 5 (52) (71) (152)
Profit/(loss) before taxation 641 17 (482)
6 207 (30) 2,084
Tax on profit/(loss)
848 (13) 1,602
Profit/(loss) for the financial period from continuing operations attributable
to owners of the parent
Items that may be reclassified subsequently to profit or loss
Exchange translation differences on consolidation 785 63 192
Other comprehensive income for the period attributable to the owners of the 785 63 192
parent
1,633 50 1,794
Total comprehensive income for the period attributable to the owners of the
parent
Earnings per share (pence)
Basic 7 0.85p (0.01p) 1.60p
Diluted 7 0.84p (0.01p) 1.59p
MIND GYM PLC CONSOLIDATED STATEMENT OF FINANCIAL POSITION
30 September 30 September 31
2022 2021 March
2022
Note (Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Non-current assets
Intangible assets 9 9,787 5,204 8,175
Property, plant and equipment 4,584 3,287 2,815
Deferred tax assets 3,084 472 2,846
Other receivables 257 212 217
17,712 9,175 14,053
Current assets
Inventories 35 - 7
Trade and other receivables 10 13,553 10,521 10,063
Current tax receivable 594 280 494
Cash and cash equivalents 4,507 11,972 10,021
18,689 22,773 20,585
36,401 31,948 34,638
Total assets
Current liabilities
Trade and other payables 11 11,123 11,250 12,729
Lease liability 1,151 1,106 856
Redeemable preference shares 50 50 50
Current tax payable - 18 28
12,324 12,424 13,663
Non-current liabilities
Lease liability 2,761 1,614 1,349
Total liabilities 15,085 14,038 15,012
21,316 17,910 19,626
Net assets
Equity
Share capital 13 1 1 1
Share premium 242 213 213
Share option reserve 597 603 608
Retained earnings 20,476 17,093 18,804
21,316 17,910 19,626
Equity attributable to owners of the parent Company
The Board of Directors approved these condensed interim financial statements
on 1 December 2022.
MIND GYM PLC CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Share capital Share premium Share option reserve Retained earnings Total equity
Note £'000 £'000 £'000 £'000 £'000
1 157 674 16,620 17,452
At 1 April 2021
- - - (13) (13)
Loss for the period
Other comprehensive income:
Exchange translation differences on consolidation - - - 63 63
Total comprehensive income for the period - - - 50 50
Exercise of options - 56 (407) 407 56
Credit to equity for share based payments 14 - - 336 - 336
Tax relating to share-based payments - - - 16 16
1 213 603 17,093 17,910
At 30 September 2021
- - - 1,615 1,615
Profit for the period
Other comprehensive income:
Exchange translation differences on consolidation - - - 129 129
Total comprehensive income for the period - - - 1,744 1,744
Credit to equity for share based payments 14 - - 5 - 5
Tax relating to share-based payments - - - (33) (33)
1 213 608 18,804 19,626
At 31 March 2022
- - - 848 848
Profit for the period
Other comprehensive income:
Exchange translation differences on consolidation - - - 785 785
Total comprehensive income for the period 1,633 1,633
Exercise of options - 29 (39) 39 29
Credit to equity for share based payments 14 - - 28 - 28
1 242 597 20,476 21,316
At 30 September 2022
MIND GYM PLC CONSOLIDATED STATEMENT OF CASH FLOWS
6 months to 6 months to Year to
30 Sept 30 Sept 31 March
2022 2021 2022
(Unaudited) (Unaudited) (Audited)
Note £'000 £'000 £'000
Cash flows from operating activities
Profit/(loss) for the financial period 848 (13) 1,602
Adjustments for:
Amortisation of intangible assets 508 34 325
Depreciation of tangible assets 713 591 1,252
Net finance costs 25 62 133
Taxation (credit)/charge (207) 30 (2,084)
(Increase) in inventories (28) - (7)
(Increase)/decrease in trade and other receivables (3,489) 238 686
(Decrease) in payables and provisions (1,606) (2,525) (1,084)
Share based payment charge 14 28 336 341
Cash generated from operations (3,208) (1,247) 1,164
Net tax (paid) (128) (329) (812)
Net cash generated from operating activities (3,336) (1,576) 352
Cash flows from investing activities
Purchase of intangible assets (2,120) (2,361) (5,623)
Purchase of property, plant and equipment (91) (423) (514)
Interest received 26 5 12
Net cash used in investing activities (2,185) (2,779) (6,125)
Cash flows from financing activities
Cash repayment of lease liabilities (683) (603) (1,226)
Issuance of ordinary shares 29 56 56
Interest paid - - (27)
Net cash used in financing activities (654) (547) (1,197)
(6,175) (4,902) (6,970)
Net (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period 10,021 16,833 16,833
Effect of foreign exchange rate changes 661 41 158
Cash and cash equivalents at the end of period 4,507 11,972 10,021
Cash and cash equivalents at the end of period comprise:
Cash at bank and in hand 4,507 11,972 10,021
MIND GYM PLC NOTES TO THE GROUP FINANCIAL STATEMENTS
1. General information
Mind Gym plc ("the Company") is a public limited company incorporated in
England & Wales and its ordinary shares are traded on the Alternative
Investment Market of the London Stock Exchange ("AIM"). The address of the
registered office is 160 Kensington High Street, London W8 7RG. The group
consists of Mind Gym plc and its subsidiaries, Mind Gym (USA) Inc., Mind Gym
Performance (Asia) Pte. Ltd and Mind Gym (Canada) Inc. (together "the Group").
The principal activity of the Group is to apply behavioural science to
transform the performance of companies and the lives of the people who work in
them. The Group does this primarily through research, strategic advice,
management and employee development, employee communication, and related
services.
2. Basis of preparation
The condensed interim financial statements have been prepared in accordance
with the requirements of the AIM Rules for Companies. As permitted, the
Company has chosen not to adopt IAS 34 "Interim Financial Statements" in
preparing this interim financial information. The condensed interim financial
statements should be read in conjunction with the annual financial statements
for the year ended 31 March 2022, which have been prepared in accordance with
International Financial Reporting Standards (IFRS) as adopted by the European
Union, including interpretations issued by the International Financial
Reporting Interpretations Committee ("IFRIC"), and with the Companies Act 2006
applicable to companies reporting under IFRS. The unaudited interim financial
information does not constitute statutory accounts within the meaning of the
Companies Act 2006. This interim report, which has neither been audited nor
reviewed by independent auditors, was approved by the board of directors on 1
December 2022.
Statutory accounts for the year ended 31 March 2022 were approved by the Board
of Directors on 9 June 2022 and delivered to the Registrar of Companies. The
report of the auditors on those accounts was unqualified, did not contain an
emphasis of matter paragraph and did not contain any statement under Section
498 of the Companies Act 2006.
The interim financial statements have been prepared on a going concern basis
under the historical cost convention.
The interim financial statements are presented in pounds sterling. All values
are rounded to £1,000 except where otherwise indicated.
The accounting policies used in preparing the interim results are the same as
those applied to the latest audited annual financial statements.
3. Segmental analysis
Operating segments are reported in a manner consistent with the internal
reporting provided to the chief operating decision maker, who is responsible
for allocating resources and assessing performance of the business. The chief
operating decision maker has been identified as the Board. The Group has two
operating segments: EMEA (comprising the United Kingdom and Singapore) and
America (comprising the United States and Canada).
Both segments derive their revenue from a single business activity, the
provision of human capital and business improvement solutions.
The Group's business is not highly seasonal and the Group's customer base is
diversified with no individually significant customer.
Segment results for the 6 months ended 30 September 2022 (Unaudited)
Segment result
EMEA America Total
£'000 £'000 £'000
Revenue 10,078 16,681 26,759
Cost of sales (1,285) (2,059) (3,344)
Administrative expenses (11,639) (11,110) (22,749)
Profit before inter-segment charges (2,846) 3,512 666
Inter-segment charges 3,260 (3,260) -
Operating profit - segment result 414 252 666
Finance income 27
Finance costs (52)
Profit before tax 641
The mix of revenue for the six months ended 30 September 2022 is set out
below.
EMEA America Group
Delivery 67.1% 64.7% 65.6%
Design 13.2% 14.8% 14.1%
Digital 11.6% 10.0% 10.7%
Licensing and certification 4.5% 6.7% 5.8%
Other 2.1% 2.4% 2.3%
Advisory 1.5% 1.4% 1.5%
Segment results for the 6 months ended 30 September 2021 (Unaudited)
Segment result
EMEA America Total
£'000 £'000 £'000
Revenue 10,255 13,887 24,142
Cost of sales (1,459) (1,959) (3,418)
Administrative expenses (11,541) (9,104) (20,645)
Profit before inter-segment charges (2,745) 2,824 79
Inter-segment charges 1,785 (1,785) -
Operating (loss)/profit - segment result (960) 1,039 79
Finance income 9
Finance costs (71)
Profit before tax 17
The mix of revenue for the six months ended 30 September 2021 is set out
below.
EMEA America Group
Delivery 64.6% 70.6% 68.1%
Design 11.2% 6.3% 8.3%
Digital 11.5% 11.3% 11.4%
Licensing and certification 4.4% 5.5% 5.0%
Other 6.4% 5.1% 5.7%
Advisory 1.9% 1.2% 1.5%
Segment results for the year ended 31 March 2022 (Audited)
Segment result
EMEA America Total
£'000 £'000 £'000
Revenue 19,715 28,953 48,668
Cost of sales (2,572) (3,712) (6,284)
Administrative expenses (23,705) (19,028) (42,733)
(Loss)/profit before inter-segment charges (6,562) 6,213 (349)
Inter-segment charges 5,084 (5,084) -
Operating (loss)/profit - segment result (1,478) 1,129 (349)
Finance income 19
Finance costs (152)
Loss before tax (482)
The mix of revenue for the year ended 31 March 2022 is set out below.
EMEA America Group
Delivery 60.2% 66.0% 63.7%
Design 13.4% 9.8% 11.2%
Digital 11.9% 10.7% 11.2%
Licensing and certification 5.8% 6.3% 6.0%
Other 6.8% 6.2% 6.5%
Advisory 1.9% 1.0% 1.4%
4. Employees
Staff costs were as follows:
6 months to 30 Sept 2022 6 months to 30 Sept 2021 Year to 31 March 2022
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Wages and salaries 15,194 13,839 28,828
Social security costs 1,395 1,477 2,825
Pension costs - defined contribution plans 550 498 983
Share-based payments 28 336 341
17,167 16,150 32,977
The average number of Group's employees by function was:
6 months to 30 Sept 2022 6 months to 30 Sept 2021 Year to 31 March 2022
(Unaudited) (Unaudited) (Audited)
Delivery 208 190 196
Support 77 80 86
Digital 39 49 50
324 319 332
The period end number of Group's employees by function was:
6 months to 30 Sept 2022 6 months to 30 Sept 2021 Year to 31 March 2022
(Unaudited) (Unaudited) (Audited)
Delivery 212 194 206
Support 77 90 88
Digital 43 62 41
332 346 335
5. Net finance costs
6 months to 30 Sept 2022 6 months to 30 Sept 2021 Year to 31 March 2022
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Finance income
Bank interest receivable 26 5 12
Finance lease income 1 4 7
Finance costs
Bank interest payable - - (27)
Lease interest (IFRS 16) (52) (71) (125)
(25) (62) (133)
6. Tax
The statutory tax credit of £207,000 (six months ended 30 September 2021:
charge of £30,000; year ended 31 March 2022: credit of £2,084,000)
represents an effective tax rate on profit before tax of -32% (six months
ended 30 September 2021: 176.5%; year ended 31 March 2022: 432.4%).
7. Earnings per share
Basic earnings per share is calculated by dividing the earnings attributable
to shareholders of the Company by the weighted average number of ordinary
shares in issue during the year. The Company has potentially dilutive shares
in respect of the share-based payment plans (see Note 14).
30 Sept 2022 30 Sept 2021 31 March 2022
(Unaudited) (Unaudited) (Audited)
Weighted average number of shares in issue 100,119,558 99,914,842 100,009,727
Potentially dilutive shares (weighted average) * 1,059,821 - 442,548
Fully diluted number of shares (weighted average) 101,179,379 99,914,842 100,452,275
*For 30 September 2021 dilutive potential ordinary shares have no effect on
the calculation of diluted EPS as their conversion into ordinary shares cannot
increase the loss per share.
6 months to 30 Sept 2022 6 months to 30 Sept 2021 Year to 31 March 2022
(Unaudited) (Unaudited) (Audited)
pence pence pence
Basic earnings per share 0.85 (0.01) 1.60
Diluted earnings per share 0.84 (0.01) 1.59
8. Dividends
The Board did not propose a final dividend for the year ended 31 March 2022.
No interim dividend is proposed for the period to 30 September 2022.
9. Intangible assets
Patents Development costs Total
£'000 £'000 £'000
Cost
At 1 April 2022 63 10,384 10,447
Additions - 2,120 2,120
At 30 September 2022 63 12,504 12,567
Amortisation
At 1 April 2022 63 2,209 2,272
Amortisation charge - 508 508
At 30 September 2022 63 2,717 2,780
Net book value
At 31 March 2022 - 8,175 8,175
At 30 September 2022 - 9,787 9,787
Development cost additions in the six months ended 30 September 2022 includes
software development costs directly incurred in the creation of new digital
assets.
10. Trade and other receivables
30 Sept 2022 30 Sept 2021 31 March 2022
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Trade receivables 10,657 8,455 7,999
Less provision for impairment (259) (227) (212)
Net trade receivables 10,398 8,228 7,787
Net investment in sub-lease - 169 81
Other receivables 202 159 82
Prepayments 1,074 870 1,170
Accrued income 1,879 1,095 943
13,553 10,521 10,063
Non-current assets includes £257,000 (30 September 2021: £212,000; 31 March
2022: £217,000) of prepayments in respect of property deposits.
Trade receivables have been aged with respect to the payment terms as follows:
30 Sept 2022 30 Sept 2021 31 March 2022
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Not past due 9,311 7,650 7,274
Past due 0-30 days 693 533 401
Past due 31-60 days 216 121 109
Past due 61-90 days 344 146 25
Past due more than 90 days 92 5 190
10,656 8,455 7,999
11. Trade and other payables
30 Sept 2022 30 Sept 2021 31 March 2022
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Trade payables 1,019 1,199 1,401
Other taxation and social security 829 733 663
Other payables 623 598 690
Accruals 4,248 4,734 5,257
Deferred income 4,404 3,986 4,718
11,123 11,250 12,729
12. Borrowings
The Group entered into a £10 million debt facility (£6m RCF, £4m accordion)
on 30 September 2021 which matures after 3 years. The facility remains
undrawn as at 2 December 2022.
13. Share capital
30 Sept 30 Sept 30 Sept 30 Sept 31 March 2022 31 March 2022
2022 2022 2021 2021
Cost Cost Cost
Number £'000 Number £'000 Number £'000
Ordinary shares of £0.0001 At 1 April 100,105,660 1 99,791,784 1 99,791,784 1
Issue of shares to satisfy options 61,924 - 313,876 - 313,876 -
Ordinary shares of £0.00001 at period end 100,167,584 1 100,105,660 1 100,105,660 1
14. Share based payments
The Group awards options to selected employees under a Long-Term Incentive
Share Option Plan ("LTIP"). The options granted to date vest subject only to
remaining employed up to the vesting date. Unexercised options do not entitle
the holder to dividends or to voting rights. The awards granted during the
six months to 30 September 2021 are subject to performance conditions based on
revenue, adjusted earnings per share and total shareholder return.
The awards granted in the six months to 30 September 2022 are subject to
performance conditions based on revenues and EBITDA. Some awards granted
during this time period are time bound only.
On the 30(th) September 2019 the Group launched an annual Save As You Earn
Scheme and an Employee Share Purchase Plan for all eligible employees in the
UK and USA respectively.
The total share-based payments expense was:
6 months to 30 Sept 2022 6 months to 30 Sept 2021 Year to 31 March 2022
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Equity settled share-based payments 28 336 341
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