Half Yearly Report

RNS Number : 6356S

Anite PLC

04 December 2012

 



Tuesday, 4 December 2012

ANITE PLC

Half year results for the six months ended 31 October 2012

Anite plc ("Anite" or "the Company" or "the Group"), the leading provider of software solutions to the international wireless and leisure travel industries, today announces its half year results for the six months ended 31 October 2012.

Financial highlights (adjusted) ¹:

·      Revenue up 9% to £61.2m (2011: £56.2m)

·      Operating profit up 21% to £14.3m (2011: £11.8m)

·      Operating margin up 2.4% points to 23.4% (2011: 21.0%)

·      Profit before tax up 30% to £14.3m (2011: £11.0m)

·      Diluted earnings per share up 31% to 3.4p (2011: 2.6p)

·      Net cash of £16.8m (October 2011: £12.6m; April 2012: £16.9m)

·      Interim dividend up 53% to 0.575p per share (2011: 0.375p per share) 

Statutory results:

·      Revenue from continuing operations of £61.2m (2011: £56.2m)

·      Operating profit from continuing operations of £11.3m (2011: £8.8m), after:

-      share based payments charge of £1.8m (2011: £1.0m)

-      amortisation of acquired intangible assets of £1.2m (2011: £2.0m)

·      Profit from continuing operations before tax of £11.3m (2011: £8.5m)

·      Profit for the period of £8.2m (2011: £6.0m)

·      Basic earnings per share 2.9p (2011: 2.1p); diluted earnings per share 2.7p (2011: 1.9p)

Operating highlights:

·      Group orders:

-      Closing order book £107.2m (31 October 2011: £92.5m; 30 April 2012: £114.5m) 

-      Order intake down 15% to £53.9m (2011: £63.8m) reflecting very strong comparative period

-      Book to bill ratio 0.9 (2011: 1.1)

·      Wireless: 

-      Strong demand in Handset Testing for Interoperability Testing and LTE 4G

-      Network Testing seeing growing momentum with Invex and LTE 4G products

·      Travel:

-      First Thomas Cook @com phase delivered and now live

-      £9m (2011: £8m) orders contracted for H2 delivery, and expanding order pipeline

Current trading:

·      Recent trends and the pipeline of existing growth opportunities, increase the Board's confidence that full year expectations will be met.

¹Adjusted results are for continuing operations before share-based payments, amortisation of acquired intangible assets, other gains and losses and recycled hedge losses.

Christopher Humphrey, Chief Executive, said:

"Anite had a good first half with encouraging trading conditions in its markets despite the uncertain global economic backdrop.

"The range and potential of growth drivers are more varied and more balanced than they used to be. This is particularly so in Handset Testing, with significant opportunities over and above its original core market. It is also evident in Network Testing and Travel which have both substantially extended their footprints in recent years.

"We therefore have increasing confidence in our ability to deliver sustainable growth in the coming years."

For further information, please contact:
Anite plc	www.anite.com @AniteNews
Christopher Humphrey, Chief Executive Richard Amos, Group Finance Director	01252 775200
MHP Communications	020 3128 8100
Reg Hoare/Giles Robinson

An analysts' meeting will be held today at 9.15 for 9.30 a.m. at the London Stock Exchange, 10 Paternoster Square, London, EC4M 7LS

Notes to editors

Anite plc, an international software and solutions company, operates in two discrete markets: we provide device and network testing systems to the wireless market and reservation and e-commerce solutions to the leisure travel industry.  The success of both divisions is based on our comprehensive knowledge of the sectors and on our proprietary software and hardware products.

Our 530 staff work with the world's leading wireless and travel companies, from our headquarters in the UK and from offices in 15 countries throughout Europe, the Americas, Asia and the Middle East.

This interim statement contains forward-looking statements. These forward-looking statements are not guarantees of future performance. Rather, they are based on current views and assumptions and involve known and unknown risks, uncertainties and other factors that may cause actual results to differ from any future results or developments expressed or implied from the forward-looking statements. Each forward-looking statement speaks only as of the date of the particular statement and, save to the extent required by the applicable law or regulation, we do not undertake any obligation to update or renew any forward-looking statement.

  Half year results for the six months ended 31 October 2012

All references to adjusted profit relate to continuing operations for the period before share-based payments, amortisation of acquired intangible assets, other gains and losses and recycled hedge losses. See the attached income statement and notes for details. A reconciliation of adjusted results to reported statutory results is given in the Financial Review.

HALF YEAR OVERVIEW

Introduction

Anite performed well in the first half with encouraging trading conditions in its markets despite the difficult global economic backdrop.  Group revenue and adjusted operating profit were ahead of last year with overall results slightly ahead of Board expectations.

Growth drivers for the Wireless division, namely the increased market penetration of smartphones, mobile data growth and the roll out and complexity of mobile phone technology, remain undiminished.  We continue to invest in these areas developing new products and accessing adjacent markets.

Handset Testing achieved healthy double digit revenue and profit growth in the first half with strong demand for its Interoperability Testing and LTE 4G products.  This result was notable given the exceptionally strong comparative results for the same period in 2011.

In underlying constant currency terms, Network Testing achieved increased profit on flat revenue despite being impacted by demanding market conditions particularly in the early part of the period.  Translation of the underlying Euro denominated results back into Sterling was, however, affected by a 9% weakening in the Euro compared to the same period last year.  

Travel traded in line with the Board's expectations, reporting an encouraging, albeit small, increase in profits as it makes progress on delivering the major projects currently under contract.  The business retains a very strong order book and we continue to be encouraged by an expanding order pipeline.

Group results summary

Overall the Group's half year results were good with a 9% increase in revenue and 21% increase in adjusted operating profit.  

The Group's closing order book grew 16% year on year to £107.2m (31 October 2011: £92.5m; 30 April 2012: £114.5m).  This year on year increase included exceptional order intake in the second half of last year in Travel, which signed a number of large, multi-year orders.  Overall order intake in the six month period was, however, down 15% to £53.9m (2011: £63.8m) although Handset Testing order intake was 6% up year on year.  The overall reduction reflected significantly lower order intake in the period in Travel due to the nature of its pipeline (which features a number of large potential orders whose timing is unpredictable).

Revenue grew by 9% to £61.2m (2011: £56.2m) with Handset Testing the significant contributor to this growth as its revenue increased 17% to £40.5m (2011: £34.7m), a record first half performance. 

Adjusted operating profit was up 21% to £14.3m (2011: £11.8m) with increased adjusted operating margins reported by all businesses: 28% (2011: 26%) in Handset Testing, 22% (2011: 20%) in Network Testing and 19% (2011: 18%) in Travel.  Finance costs in this period were a net £nil (2011: £0.8m) following the repayment of outstanding term loans in November 2011 and adjusted profit before tax was £14.3m (2011: £11.0m).

Adjusted diluted earnings per share increased 31% to 3.4p (2011: 2.6p).

Anite has a strong balance sheet with net cash resources and financial flexibility provided by significant undrawn bank facilities.  Net cash as at 31 October 2012 was £16.8m (April 2012: £16.9m; October 2011: £12.6m), with cash generation consistent with usual seasonal patterns.  The Group has a revolving banking facility of £20m together with a £5m overdraft facility. Both facilities remained undrawn at 31 October 2012. 

Dividend

Following the significant increase in dividend last year, the Board has stated that its policy is to increase future full year dividends broadly in line with earnings growth.  At the same time, this year we are aiming to re-align the balance between the interim and final dividend so payments are made in a more standard one third: two thirds split.

The Board is therefore declaring an interim dividend of 0.575p per share (2011: 0.375p per share). The 53% year on year growth this represents includes elements for both growth in earnings and for the rebalancing of the interim to final dividend ratio.  The dividend will be paid on 15 February 2013 to shareholders on the register at 25 January 2013.

Outlook 

The results for the first six months of the year, together with recent trends and the pipeline of potential new business, increase the Board's confidence that its full year expectations will be met.  Overall the Board expects that Group performance in the second half of the year will show an improvement both on the first half and on the same period last year.  It should however be noted that Group trading is typically biased towards the second half and that the Wireless businesses continue to operate with short sales pipeline visibility, whilst Travel orders tend to follow a lengthy sales cycle.

Travel's contracted order book of £9m for second half delivery provides support to repeat its first half financial performance.  Notwithstanding the sales timing risk that is ever present in this type of business, the pipeline of opportunities for new licence sales is underpinning expectations of period on period growth. 

We expect Network Testing to show growth in the second half as it maintains the progress demonstrated in the latter part of the recent half through the success of the Invex product, growing momentum with LTE 4G products and an improved product margin mix. Assuming no further weakening of the Euro, we expect the business to achieve its original full year expectation of mid-single digit profit growth.

The Board's expectations for second half Handset Testing performance are set in the context of its short pipeline visibility discussed above.  At this stage, we expect Handset Testing's second half performance will show healthy growth on both the first half and against the same period last year, consistent with achieving its full year expectations.  

Looking out further the Board is encouraged by developments in each part of the Group and the strong market position of each business.  The range and potential of growth drivers are more varied and more balanced than they used to be.  This is particularly so in Handset Testing, with significant opportunities over and above its original core market.  It is also evident in Network Testing and Travel which have both substantially extended their footprints in recent years.  We therefore have increasing confidence in our ability to deliver sustainable growth in the coming years.

Clay Brendish Chairman                                               Christopher Humphrey Chief Executive

3 December 2012

OPERATING REVIEW

Anite's operations comprise two divisions: Wireless and Travel.  The Wireless division is made up of two separately managed businesses: Handset Testing and Network Testing.

The overall results for the Group show a good performance in the first half of this year compared to the same period last year, especially in Handset Testing.

Wireless performance

Handset Testing

The results for the Handset Testing business for the period show that order intake increased by 6% to £37.4m (2011: £35.4m), revenue increased by 17% to £40.5m (2011: £34.7m) and adjusted operating profit increased by 27% to £11.4m (2011: £9.0m). The Board considers that this represents good progress by the Handset Testing business, particularly given the exceptional performance in the comparative period last year.

The first half of the year has seen a steady continuation of the trends seen over the recent past. Network operators continue to roll-out LTE 4G networks and there were 113 LTE 4G networks live by 31 October 2012, notably including the first commercial network in the UK.  Additionally, those operators who were early to roll-out, such as Verizon, continue to expand their network coverage and in response more manufacturers are launching more LTE 4G devices. As at 31 October 2012, there had been 61 LTE 4G compatible devices certified in 2012 in addition to the 10 certified in 2011. Most of these devices have been certified for the normal FDD variant of LTE 4G, but devices are starting to become available for the TD-LTE variant that will dominate in China and has additionally already been rolled out in Japan.

Increased LTE 4G revenue continued to be the main driver of Handset Testing growth, rising 29% to £20.2m in the period (2011: £15.6m), and now represents 50% of overall Handset Testing revenue.  Revenue for 2G/3G technologies also showed a 6% increase to £20.3m (2011: £19.1m). 

Revenue from Development Testing remained flat year on year whilst Conformance Testing revenue increased by 7% against what were exceptional increases last year.  Interoperability Testing is the other main driver of growth and it grew by 36%. It is an increasingly important part of the Handset Testing business now accounting for over 40% of its revenue. There is a trend for mobile operators to take stronger control of their supply chains to bring product to market quicker and identify faults earlier, so driving the growth in demand for testing in this area.

The key driver of growth for the Conformance Testing market is the increased adoption of new technology in the mobile phone network.  Growth in data and smartphones has increased the need for network operators to build extra speed and capacity into their networks.  This has caused the acceleration in the adoption of LTE 4G and the earlier development of LTE Advanced, the next step in the technology roadmap.  The growth drivers for Interoperability Testing are different from Conformance Testing and are derived from the growing complexity caused by numerous mobile phone technologies layering one upon another, together with the growing number of apps that are having a critical effect on the efficiency of the network.  These factors combined are having a significant effect on the customer's experience.  In order to tackle these problems network operators are requesting new Interoperability Testing systems tailored to test the weaker aspects of their individual network configuration.  Interoperability Testing adds another layer of quality assurance for the operator and importantly provides long term, sustainable growth for Anite.

Conformance Testing remains the core of the Handset Testing business.  Anite retains market leadership in LTE 4G conformance testing with over 400 validated test cases.  As anticipated, the gap between Anite and its competition is closing as the "FDD" variant of the LTE 4G standard becomes more developed.  However, Anite continues to lead the field in the CT TD-LTE market.  In addition, the Global TD-LTE Initiative (GTI), an industry taskforce, recently announced that Anite was the first vendor to achieve the validation targets for TD-LTE interoperability test cases for device functionality and performance testing.  Achieving this landmark target is important as it underlines Anite's leading position in developing mobile operator device acceptance test cases. Anite's progress will help device manufacturers accelerate the commercial roll-out of this technology.

Net revenue margin (revenue less third-party hardware cost) improved to 76% compared to 72% in the same period last year.  This was due to higher maintenance revenue, up 19% to £11.3m (2011: £9.5m) and an increased proportion of software sold in the period, up 25% to £19.4m (2011: £15.5m).

Investment in R&D has increased in the period as we continue the development of LTE 4G products to maintain technological leadership. R&D incurred in the period included investment in extending the capability of our LTE 4G platform to accommodate LTE Advanced functionality and also spending on further IOT opportunities.  The R&D charge to the income statement was £6.6m in the period (2011: £5.9m) including £1.0m amortisation of previously capitalised costs (2011: £0.6m).  An additional £1.4m of development cost was capitalised in the period (2011: £1.0m) reflecting investment incurred in maintaining market leadership in conformance and Interoperability test scripts.

Other fixed costs in Handset Testing have increased from £10.1m last year to £12.7m principally as a result of additional staffing in sales, customer support and development maintenance areas to support the increased size of the business and growing installed base of systems.  After fixed costs, net operating margin increased to 28% (2011: 26%).

The Handset Testing business is well positioned to continue to benefit from the opportunities LTE 4G is yielding with a broader range of products and further opportunities to develop gradually into adjacent market areas.

Network Testing

Network Testing order intake for the period was down 8% at £12.1m (2011: £13.1m) and revenue down 7% to £11.8m (2011: £12.7m) although adjusted operating profit was unchanged at £2.6m (2011: £2.6m).  These reported results for the period were, however, affected by a 9% period on period weakening in translating the Euro denominated results of the business back into Sterling.  Adjusting the performance in underlying Euro terms, order intake and revenue were up 1% and 2% respectively, with operating profit 10% ahead.

Market conditions for the Network Testing business remained challenging, particularly in the early part of the year.  The business, however, improved its performance in the latter part of the period, particularly through increased demand for the Invex benchmarking product (acquired in January 2011), revenue for which was significantly higher than in the comparative period.

Margins in the business were also strong with net revenue increasing from 70% to 72%, helped in part by an increased proportion of sales of higher margin in-house scanners and also by foreign exchange transactional benefits which yielded £0.3m as the business benefitted from its costs being mainly located in the relatively weak Euro-zone.

The income statement charge for investment in R&D in Network Testing remained at £1.8m (2011: £1.8m) including £0.1m amortisation of capitalised costs (2011: £0.1m).  In addition, £0.2m of R&D costs (2011: £0.3m) were capitalised in relation to the development of the benchmarking product.  Other fixed costs in Network Testing were down £0.1m in constant currency terms. Net operating margins in Network Testing increased to 22% (2011: 20%).

The Network Testing business is starting to see some initial benefit from the roll-out of LTE 4G networks, although this remains very much at an early stage.  We do not expect to see significant revenue from Network Testing LTE 4G tools until the next financial year, at which time, we expect the growth rate to be lower than we experienced in Handset Testing due to the typical pattern of investment in test tools by operators.

Travel

The Travel division traded in accordance with our expectations in the first half year.  Order intake in the period reduced as expected to £4.4m (2011: £15.3m) while revenue was marginally up at £8.9m (2011: £8.8m) and the adjusted operating profit up 6% at £1.7m (2011: £1.6m).  This profit performance is after the transaction effect of Euro currency fluctuations which, year on year, reduced profits by £0.4m.  The order book of contracted but undelivered revenue at the period end was £85.1m (30 April 2012: £89.6m, 31 October 2011: £69.7m).  Around £9m of the closing order book is expected to be delivered in the second half of the year, compared to about £8m at the same point last year.

During the first half of the year, Travel made good progress with the delivery and go-live of phase one of the @com system for Thomas Cook UK and Ireland.  Progress has also been made with TUI to implement @com into its UK mainstream business and on other smaller deployments.

The net revenue percentage in Travel reduced to 91% (2011: 97%) reflecting additional hardware/third party product sold in the period.  Travel's fixed costs reduced by £0.4m to £6.5m (2011: £6.9m) due to operating efficiencies compared to the prior period.  The fixed cost reduction, combined with incremental sales, resulted in net operating margins in Travel increasing to 19% (2011: 18%).

The Travel business has an encouraging level of contracted orders for delivery in the second half and a strong pipeline of sales prospects.  These provide the opportunity for the business to develop increased levels of recurring revenues, a sustainable business model and growth in the long term.

FINANCIAL REVIEW

Revenue

Revenue from continuing operations was up 9% at £61.2m (2011: £56.2m).  Geographically, revenue by destination was: United Kingdom 13% (2011: 12%); other Europe, Middle East & Africa 25% (2011: 28%); the Americas 30% (2011: 35%); and Asia & Rest of World 32% (2011: 25%).  The growth in the latter segment was partly achieved in India where tier one device and chipsetmanufacturers are investing significantly in R&D facilities.

Reconciliations of Adjusted and Statutory Profits

Reconciliations of adjusted EBITDA of £17.2m to the operating profit of £11.3m and adjusted operating profit of £14.3m to the reported profit before tax for the year of £11.3m are set out in the tables below.  The reconciling items are those that, in the opinion of the Board, are either one-off in nature or are non-cash related and are not therefore indicative of the Group's underlying trading.

Half year ended 31 October:	2012	2011
	£m	£m
Adjusted EBITDA	17.2	14.2
Depreciation	(1.6)	(1.5)
Amortisation of intangible assets	(1.3)	(0.9)
Adjusted operating profit	14.3	11.8
Share-based payments	(1.8)	(1.0)
Amortisation of acquired intangible assets	(1.2)	(2.0)
Operating profit	11.3	8.8

Half year ended 31 October:	2012	2011
	£m	£m
Adjusted operating profit	14.3	11.8
Net finance charges before recycled hedge losses	-	(0.8)
Adjusted profit before tax	14.3	11.0
Share-based payments	(1.8)	(1.0)
Amortisation of acquired intangible assets	(1.2)	(2.0)
Other gains and losses	-	0.5
Profit from continuing operations before tax	11.3	8.5

Currency effects 

The average exchange rates, half year on half year, for the US Dollar strengthened against Sterling from £1=US$1.61 to £1=US$1.58, and for the Euro weakened from £1=€1.14 to £1=€1.25.  The closing exchange rate for the Euro weakened against Sterling to £1=€1.24 (April 2012: £1=€1.23) and the closing exchange rate for the US Dollar strengthened to £1=US$1.61 (April 2012: £1=US$1.63).

The net effect of these changes on the translation of results from overseas subsidiaries was to reduce revenue by £1.0m and profits by £0.3m.  Adjusting for these impacts, the underlying growth in revenue was 11% and in operating profit 24%.  Network Testing was the main business impacted by these translational changes.  In addition the effect of trading in foreign currencies resulted in transaction losses of £0.3m making the total adverse effect of currency fluctuations on profits £0.6m year on year of which £0.2m was in the Handset Testing business and £0.4m in the Travel business.

Cost of sales

Cost of sales increased 8%, slightly less than the growth in revenue, and gross profit increased slightly to 59% (2011: 58%).  Within cost of sales hardware/third party costs were unchanged at £13.9m (2011: £13.9m).  Other cost of sales increased by 18% to £11.4m (2011: £9.6m) and was due to the increase in staff and other costs directly associated with the delivery of revenue and to support the growing number of installed systems in the Handset Testing business.

Operating expenses

Total operating expenses in the period increased to £24.6m (2011: £23.9m).  A detailed breakdown is given in note 2.3.

Within total operating expenses are one-off and non-cash items not charged to adjusted operating profit and underlying operating expenses that are charged to adjusted operating profit.  The latter increased to £21.6m (2011: £20.9m), mainly due to increased R&D (£0.7m) in the Handset Testing business.

During the period, unallocated Group corporate costs remained unchanged at £1.4m (2011: £1.4m).

After the underlying operating expenses, adjusted operating profit increased by 21% to £14.3m (2011: £11.8m).  Adjusted EBITDA was up 21% at £17.2m (2011: £14.2m).

One-off and non-cash expenses excluded from adjusted profit calculations totalled £3.0m (2011: £3.0m).  This included amortisation of acquired intangible assets of £1.2m (2011: £2.0m) and a share-based payments charge of £1.8m (2011: £1.0m).  After these non-operational costs, the Group reported an overall operating profit of £11.3m (2011: operating profit of £8.8m).

Group finance costs

The Group incurred net £nil finance charges in the period (2011: £0.8m).  The reduction follows the settlement in 2011 of the Group's swap and term loan liabilities.  The Group had no borrowings at 31 October 2012.

Taxation

The tax charge for the period on continuing operations was £3.1m (2011: £2.6m).  The tax rate on the statutory operating profit was 27.2% (2011: 30.2%).  The underlying tax rate on adjusted profit before tax was 27.0% (2011: 28.5%).  Tax paid in the period was £3.0m (2011: £1.5m).

Earnings per share

After taking account of the factors described above, adjusted basic earnings per share increased 32% to 3.7p (2011: 2.8p), adjusted diluted earnings per share increased 31% to 3.4p (2011: 2.6p).  The overall basic earnings per share for continuing operations was 2.9p (2011: 2.1p).

Cash flow

Cash generated from operating activities was £10.7m (2011: £14.8m).  This represented a conversion of 75% of adjusted profit before tax (2011: 125%).  The reduction resulted from a £5.1m movement in working capital in the period reflecting the increased receivables at the period end coupled with the creditor payments made early in the period in respect of inventory built up at the end of the last financial year to meet the requirements of the additional business in Handset Testing.

Capital expenditure in the period was £2.5m (2011: £1.9m) principally on software licences (£0.3m) and LTE 4G sales demonstration and development systems for the Handset Testing business.  A further £1.6m was incurred on capitalised development expenditure (2011: £1.3m), which represented the cost of writing conformance and interoperability test cases for Handset Testing's LTE 4G product and development of the benchmarking product in Network Testing.

Dividends paid in the period were £3.2m (2011: £2.1m) and a net £0.5m was incurred on buying shares for the Employee Benefit Trust (2011: £0.7m).  After these movements and the effect of currency exchange rates, net cash decreased by £0.1m (2011: net cash decrease of £15.1m following the settlement of the cross currency swap and repayment of term loan in 2011).

Borrowings and facilities

At 31 October 2012 the Group had net cash of £16.8m (31 October 2011: £12.6m; 30 April 2012: £16.9m).  The Group had no net borrowings at 31 October 2012 (31 October 2011: net borrowings £10.0m; 30 April 2012: £nil).The Group has a revolving credit facility of £20.0m at 31 October 2012 (30 October 2011: £20.0m; 30 April 2012: £20.0m) together with a net overdraft facility of £5.0m (31 October 2011: £5.0m; 30 April 2012: £5.0m).  Both these facilities were undrawn at 31 October 2012.

Key risks and uncertainties, going concern and Statement of Directors' Responsibilities

Risks and uncertainties

There are a number of potential risks and uncertainties which could have a material impact on the Group's performance over the remaining six months of the financial year and could cause actual results to differ materially from expected and historical results.

These risks include:

·      Global economic and geo-political risks

·      Competitiveness

·      Technology risks

·      Project delivery risks

·      Reliance on major customers

·      Human resource and organisation risks; and

·      Financial risks

The directors do not consider that the principal risks and uncertainties have changed since the publication of the annual report for the year ended 30 April 2012.  A detailed explanation of these risks is set out on pages 31 to 33 of the annual report, which is available at www.anite.com.

Outlook

Any forward-looking statements made within this interim half year report have been made in good faith by the Directors based on the information made available up to the date of the Directors' approval of this report.  These forward-looking statements should be treated with caution due to the inherent uncertainties, including macro-economic, IT service and solution market uncertainties and business risk factors which may affect the outcome.

Going concern

In considering going concern and liquidity risk, the Directors have reviewed the Group's future cash requirements and earnings projections for the next two financial years.  The Directors believe these forecasts, which show the Group being covenant compliant for the foreseeable future, have been prepared on a prudent basis and have also considered the impact of a range of reasonably possible changes to trading performance. The Directors have concluded that given these circumstances, together with the significant cash balances and unused loan facilities, it is appropriate to prepare the financial statements of the Group on a going concern basis.

Statement of Directors' responsibilities

The Directors confirm that to the best of their knowledge:

·      The condensed set of financial statements has been prepared in accordance with IAS 34;

·      The interim management report includes a fair review of the information required by DTR 4.2.7R (indication of important events during the first six months and description of principal risks and uncertainties for the remaining six months of the year); and

·      The interim management report includes a fair review of the information required by DTR 4.2.8R (disclosure of related parties' transactions and changes therein).

By order of the Board

Richard Amos

Group Finance Director and Company Secretary

3 December 2012

INDEPENDENT REVIEW REPORT TO ANITE PLC

We have been engaged by the company to review the condensed consolidated set of financial statements in the half-yearly financial report for the six months ended 31 October 2012 which comprises the condensed consolidated income statement, the condensed consolidated statement of comprehensive income, the condensed consolidated statement of changes in equity, the condensed consolidated balance sheet, and the condensed consolidated cash flow statement and related notes 1 to 12.  We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.

This report is made solely to the company in accordance with International Standard on ReviewEngagements (UK and Ireland) 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Auditing Practices Board.  Our work has been undertaken so that we might state to the company those matters we are required to state to it in an independent review report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company, for our review work, for this report, or for the conclusions we have formed.

Directors' responsibilities

The half-yearly financial report is the responsibility of, and has been approved by, the Directors.  The Directors are responsible for preparing the half-yearly financial report in accordance with the Disclosure and Transparency Rules of the United Kingdom's Financial Services Authority.

As disclosed in note 1, the annual financial statements of the group are prepared in accordance with IFRSs as adopted by the European Union.  The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with International Accounting Standard 34, "Interim Financial Reporting," as adopted by the European Union.

Our responsibility

Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review.

Scope of review

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the six months ended 31 October 2012 is not prepared, in all material respects, in accordance with International Accounting Standard 34 as adopted by the European Union and the Disclosure and Transparency Rules of the United Kingdom's Financial Services Authority.

Deloitte LLP

Chartered Accountants and Statutory Auditor

London, United Kingdom

3 December 2012

Condensed consolidated income statement

		Six months ended 31 October 2012	Six months ended 31 October 2011	Year  ended 30 April 2012
		(unaudited)	(unaudited)	(audited)
	Note	£000	£000	£000
Continuing operations
Revenue	2.1	61,184	56,242	122,546
Cost of sales		(25,265)	(23,496)	(50,105)
Gross profit		35,919	32,746	72,441
Distribution costs		(5,987)	(6,223)	(12,463)
Research and development		(8,578)	(8,554)	(17,096)
Administrative expenses		(10,023)	(9,168)	(20,383)
Operating expenses	2.3	(24,588)	(23,945)	(49,942)
Operating profit before share-based payments, amortisation of acquired intangible assets and restructuring costs		14,303	11,751	28,772
Share-based payments	3	(1,766)	(980)	(2,889)
Amortisation of acquired intangible assets		(1,206)	(1,970)	(3,340)
Restructuring costs		-	-	(44)
Operating profit		11,331	8,801	22,499
Other gains and losses		-	487	487
Finance income	4	59	266	353
Finance charges	4	(104)	(1,025)	(1,152)
Profit from continuing operations before tax		11,286	8,529	22,187
Tax expense	5	(3,070)	(2,574)	(5,974)
Profit from continuing operations		8,216	5,955	16,213
Profit from discontinued operations	5	-	-	2,253
Profit for the period - attributable to equity holders of the parent		8,216	5,955	18,466
Continuing and discontinued operations
Earnings per share - basic	6	2.9p	2.1p	6.5p
- diluted		2.7p	1.9p	6.0p
Continuing operations
Earnings per share - basic	6	2.9p	2.1p	5.7p
- diluted		2.7p	1.9p	5.3p

Condensed consolidated statement of comprehensive income

		Six months ended 31 October 2012	Six months ended 31 October 2011	Year  ended 30 April 2012
		(unaudited)	(unaudited)	(audited)
	Note	£000	£000	£000
Retained profit for the period		8,216	5,955	18,466
Exchange differences arising on translation of foreign operations		(697)	(1,178)	(6,745)
Cash flow hedges		-	237	237
Recycling of fair value loss on cash flow hedges from equity to profit or loss1		-	42	42
Tax credit / (charge) taken directly to other comprehensive income	5	31	50	(193)
Total comprehensive income		7,550	5,106	11,807

1  The fair value losses recycled to the income statement are disclosed within finance charges (note 4).

Condensed consolidated statement of changes in equity

	Issued share capital	Share premium account	Own shares	Merger reserve	Capital redemption reserve	Other reserves	Retained earnings	Total
	£000	£000	£000	£000	£000	£000	£000	£000
Balance at 1 May 2011 Changes in equity for the period to 31 October 2011	33,680	25,560	(9,229)	722	2,741	(4,829)	33,055	81,700
Total comprehensive income for the period	-	-	-	-	-	(849)	5,955	5,106
Issue of share capital	2	7	-	-	-	-	-	9
Purchase of own shares into employee benefit trust	-	-	(673)	-	-	-	-	(673)
Gain on sale of shares from employee benefit trust	-	-	752	-	-	-	(749)	3
Recognition of equity-settled share-based payments after tax	-	-	-	-	-	-	705	705
Dividend paid	-	-	-	-	-	-	(2,103)	(2,103)
Balance at 31 October 2011 (unaudited)	33,682	25,567	(9,150)	722	2,741	(5,678)	36,863	84,747
Changes in equity for the period to 30 April 2012
Total comprehensive income for the period	-	-	-	-	-	(5,810)	12,511	6,701
Issue of share capital	20	61	-	-	-	-	-	81
Purchase of own shares into employee benefit trust	-	-	(955)	-	-	-	-	(955)
Gain on sale of shares from employee benefit trust	-	-	123	-	-	-	(122)	1
Recognition of equity-settled share-based payments after tax	-	-	-	-	-	-	2,594	2,594
Dividend paid	-	-	-	-	-	-	(1,068)	(1,068)
Balance at 30 April 2012 (audited)	33,702	25,628	(9,982)	722	2,741	(11,488)	50,778	92,101
Changes in equity for the period to 31 October 2012
Total comprehensive income for the period	-	-	-	-	-	(666)	8,216	7,550
Issue of share capital	25	31	-	-	-	-	-	56
Purchase of own shares into employee benefit trust	-	-	(874)	-	-	-	-	(874)
Gain on sale of shares from employee benefit trust	-	-	1,506	-	-	-	(1,159)	347
Recognition of equity-settled share-based payments after tax	-	-	-	-	-	-	1,713	1,713
Dividend paid	-	-	-	-	-	-	(3,233)	(3,233)
Balance at 31 October 2012 (unaudited)	33,727	25,659	(9,350)	722	2,741	(12,154)	56,315	97,660

Condensed consolidated balance sheet

		31 October 2012	31 October 2011	30 April 2012
		(unaudited)	(unaudited)	(audited)
	Note	£000	£000	£000
Non-current assets
Goodwill		53,699	57,953	54,280
Other intangible assets		15,114	17,740	15,892
Property, plant and equipment		11,962	9,420	10,967
Deferred tax assets		4,898	2,613	4,489
		85,673	87,726	85,628
Current assets
Inventories		10,321	7,098	10,195
Trade and other receivables		35,389	29,443	32,856
Derivative financial assets		53	224	92
Current tax assets		232	811	157
Cash and cash equivalents	7	16,832	22,632	16,947
		62,827	60,208	60,247
Total assets		148,500	147,934	145,875
Current liabilities
Trade and other payables		(36,425)	(32,476)	(37,741)
Bank borrowings	7	-	(10,000)	-
Current tax payable		(7,793)	(10,490)	(7,666)
Derivative financial liabilities		(22)	-	-
Provisions		(3,457)	(5,423)	(4,899)
		(47,697)	(58,389)	(50,306)
Non-current liabilities
Deferred tax liabilities		(2,095)	(3,045)	(2,527)
Provisions		(1,048)	(1,753)	(941)
		(3,143)	(4,798)	(3,468)
Total liabilities		(50,840)	(63,187)	(53,774)
Net assets		97,660	84,747	92,101
Equity
Issued share capital	8	33,727	33,682	33,702
Share premium account		25,659	25,567	25,628
Own shares		(9,350)	(9,150)	(9,982)
Merger reserve		722	722	722
Capital redemption reserve		2,741	2,741	2,741
Other reserves		(12,154)	(5,678)	(11,488)
Retained earnings		56,315	36,863	50,778
Total equity		97,660	84,747	92,101

The accompanying notes are an integral part of this consolidated balance sheet

Condensed consolidated cash flow statement

			Six months ended 31 October 2012		Six months ended 31 October 2011		Year  ended 30 April 2012
			(unaudited)		(unaudited)		(audited)
	Note	£000		£000		£000
Profit for the period
Continuing operations		8,216		5,955		16,213
Discontinued operations		-		-		2,253
		8,216		5,955		18,466
Adjustments for:
Tax charge - continuing and discontinued	5	3,070		2,574		3,721
Other (gains) and losses		-		(487)		(487)
Net finance charges	4	45		759		799
Depreciation property, plant and equipment		1,547		1,479		3,280
Amortisation of intangible assets		1,337		958		2,154
Amortisation of acquired intangible assets		1,206		1,970		3,340
Profit on disposal of property, plant and equipment		-		-		(74)
Share-based payments charge	3	1,766		980		2,889
Decrease in provisions		(1,356)		(1,124)		(1,907)
Operating cash flows before movements in working capital		15,831		13,064		32,181
Increase in inventories		(126)		(2,376)		(5,473)
(Increase)/decrease in receivables		(2,534)		2,497		(894)
(Decrease)/Increase in payables		(2,457)		1,579		5,160
Movements in working capital		(5,117)		1,700		(1,207)
Cash generated from operations		10,714		14,764		30,974
Interest received		47		473		509
Interest paid		(89)		(1,154)		(1,381)
Income taxes paid		(3,033)		(1,516)		(5,413)
Net cash generated from operating activities		7,639		12,567		24,689
Cash flow from investing activities
Settlement of cross-currency swap		-		(21,590)		(21,591)
Purchase of product line and deferred consideration paid		-		(33)		(622)
Purchase of property, plant and equipment		(2,207)		(1,548)		(4,952)
Proceeds from sale of property, plant and equipment		-		-		76
Purchase of software licences		(319)		(294)		(697)
Expenditure on capitalised product development		(1,604)		(1,343)		(2,629)
Net cash used in investing activities		(4,130)		(24,808)		(30,415)
Cash flow from financing activities
Issue of ordinary share capital		56		9		90
Purchase of own shares into employee benefit trust		(874)		(673)		(1,628)
Proceeds from employee SAYE scheme to purchase shares from employee benefit trust		347		3		4
Dividend paid to Company's shareholders		(3,233)		(2,103)		(3,171)
Repayment of bank loans		-		-		(10,000)
Net cash used in financing activities		(3,704)		(2,764)		(14,705)
Net decrease in cash and cash equivalents		(195)		(15,005)		(20,431)
Effect of exchange rate changes		80		(30)		(289)
Cash and cash equivalents at beginning of period		16,947		37,667		37,667
Cash and cash equivalents at end of period	7	16,832		22,632		16,947

1 BASIS OF PREPARATION AND accounting policies

The unaudited condensed consolidated financial statements have been prepared using accounting policies consistent with International Financial Reporting Standards (IFRS) as adopted by the European Union and in accordance with International Accounting Standard (IAS) 34: 'Interim Financial Reporting'.

The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those followed in preparation of the Group's annual financial statements for the year ended 30 April 2012 as available on our website www.anite.com.

1.1  Information regarding future accounting standards

There are no new standards or improvements to existing standards that are mandatory for the first time in the Group's accounting period beginning on 1 May 2012 and no new standards have been early adopted. The Group's October 2012 Interim Report has adopted the following amendments to IFRS with no significant impact on the Group's financial performance or position:

IFRS 7 "Financial Instruments: Disclosures"

IAS 12 "Deferred Tax: Recovery of Underlying Assets"

IFRS 1 "Severe Hyperinflation and Removal of Fixed Dates for First-time Adopters"

1.2  Other information

The financial information contained in this Interim Report does not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006. The financial information contained in this Interim Report has been reviewed by the auditors but not audited.

The figures for the year ended 30 April 2012 do not constitute the statutory accounts for that period but are based upon the Group's audited accounts prepared under IFRS. The statutory accounts for the year ended 30 April 2012 have been delivered to the Registrar of Companies. The auditor's report on those accounts was unqualified and did not contain a statement under section 498(2) or (3) of the Companies Act 2006.

On 3 December 2012, this unaudited Interim Report was approved by the Board of Directors for issue.

2  Revenue and segmental information

2.1 Revenue from operations

		Six months ended  31 October 2012	Six months ended  31 October 2011	Year  ended  30 April 2012
	Note	£000	£000	£000
Own product software licences		26,588	23,168	52,561
Hardware and other third-party product		14,112	14,427	30,959
Bespoke services, systems integration and implementation of software products		3,131	3,788	7,908
Managed services		2,451	2,219	4,552
Software maintenance and support		14,902	12,640	26,566
Revenue from operations	2.2	61,184	56,242	122,546
Finance income	4	59	266	353
Total revenue		61,243	56,508	122,899

2.2 Operating segments - primary basis

The Group is organised into four operating segments: Handset Testing; Network Testing; Travel and Group. With the exception of Group, which performs the head office function, each operating segment derives its revenue from the development, installation and support of products, mainly software, relating to its relevant industry sector.

Operating segment information under the primary reporting format is as disclosed in the tables below:

	Handset Testing	Network Testing	Total Wireless	Travel	Group	Total
Six months ended 31 October 2012	£000	£000	£000	£000	£000	£000
External revenue	40,491	11,802	52,293	8,891	-	61,184
Internal revenue	-	-	-	-	1,027	1,027
Total revenue	40,491	11,802	52,293	8,891	1,027	62,211
Segment adjusted1 profit / (loss) before tax	11,435	2,561	13,996	1,661	(1,399)	14,258
Net finance charges	-	-	-	-	45	45
Segment adjusted1 operating profit / (loss)	11,435	2,561	13,996	1,661	(1,354)	14,303
Share-based payments	(408)	(100)	(508)	(146)	(1,112)	(1,766)
Amortisation of acquired intangible assets	-	(1,206)	(1,206)	-	-	(1,206)
Segment operating profit / (loss)	11,027	1,255	12,282	1,515	(2,466)	11,331
Finance income	-	-	-	-	59	59
Finance charges	-	-	-	-	(104)	(104)
Profit / (loss) from continuing operations before tax	11,027	1,255	12,282	1,515	(2,511)	11,286
Tax expense	-	-	-	-	(3,070)	(3,070)
Profit / (loss) from continuing operations	11,027	1,255	12,282	1,515	(5,581)	8,216
Profit from discontinued operations	-	-	-	-	-	-
Profit / (loss) for the period	11,027	1,255	12,282	1,515	(5,581)	8,216
Segment total assets	41,294	69,805	111,099	14,725	22,676	148,500

1 Profit / (loss) from continuing operations before share-based payments and amortisation of acquired intangible assets

2.2 Operating segments - primary basis (continued)

	Handset Testing	Network Testing	Total Wireless	Travel	Group	Total
Six months ended 31 October 2011	£000	£000	£000	£000	£000	£000
External revenue	34,725	12,718	47,443	8,799	-	56,242
Internal revenue	-	-	-	-	850	850
Total revenue	34,725	12,718	47,443	8,799	850	57,092
Segment adjusted1 profit / (loss) before tax	9,011	2,575	11,586	1,561	(2,113)	11,034
Net finance charges before recycled hedge loss	-	-	-	-	717	717
Segment adjusted1 operating profit / (loss)	9,011	2,575	11,586	1,561	(1,396)	11,751
Share-based payments	(359)	(89)	(448)	39	(571)	(980)
Amortisation of acquired intangible assets	-	(1,970)	(1,970)	-	-	(1,970)
Segment operating profit / (loss)	8,652	516	9,168	1,600	(1,967)	8,801
Other gains and losses	-	-	-	-	487	487
Finance income	-	-	-	-	266	266
Finance charges	-	-	-	-	(1,025)	(1,025)
Profit / (loss) from continuing operations before tax	8,652	516	9,168	1,600	(2,239)	8,529
Tax expense	-	-	-	-	(2,574)	(2,574)
Profit / (loss) from continuing operations	8,652	516	9,168	1,600	(4,813)	5,955
Profit from discontinued operations	-	-	-	-	-	-
Profit / (loss) for the period	8,652	516	9,168	1,600	(4,813)	5,955
Segment total assets	29,655	77,760	107,415	11,612	28,907	147,934

1 Profit / (loss) from continuing operations before share-based payments, amortisation of acquired intangible assets, other gains and losses and recycled hedge losses

2.2 Operating segments - primary basis (continued)

	Handset Testing	Network Testing	Total Wireless	Travel	Group	Total
Year ended 30 April 2012	£000	£000	£000	£000	£000	£000
External revenue	76,423	26,044	102,467	20,079	-	122,546
Internal revenue	-	-	-	-	1,583	1,583
Total revenue	76,423	26,044	102,467	20,079	1,583	124,129
Segment adjusted1 profit / (loss) before tax	21,458	5,311	26,769	4,622	(3,376)	28,015
Net finance charges before recycled hedge loss	-	-	-	-	757	757
Segment adjusted1 operating profit / (loss)	21,458	5,311	26,769	4,622	(2,619)	28,772
Share-based payments	(695)	(36)	(731)	69	(2,227)	(2,889)
Amortisation of acquired intangible assets	-	(3,340)	(3,340)	-	-	(3,340)
Restructuring costs	-	-	-	-	(44)	(44)
Segment operating profit / (loss)	20,763	1,935	22,698	4,691	(4,890)	22,499
Other gains and losses	-	-	-	-	487	487
Finance income	-	-	-	-	353	353
Finance charges	-	-	-	-	(1,152)	(1,152)
Profit / (loss) from continuing operations before tax	20,763	1,935	22,698	4,691	(5,202)	22,187
Tax expense	-	-	-	-	(5,974)	(5,974)
Profit / (loss) from continuing operations	20,763	1,935	22,698	4,691	(11,176)	16,213
Profit from discontinued operations	-	-	-	-	2,253	2,253
Profit / (loss) for the period	20,763	1,935	22,698	4,691	(8,923)	18,466
Segment total assets	38,599	61,687	100,286	11,700	33,889	145,875

1 Profit / (loss) from continuing operations before share-based payments, amortisation of acquired intangible assets, restructuring costs, other gains and losses and recycled hedge losses

2.3 Operating expenses

	Six months ended  31 October 2012	Six months ended  31 October 2011	Year  ended 30 April 2012
	£000	£000	£000
Distribution costs
- amortisation of acquired intangible assets	1,041	1,141	2,243
- other underlying operating expenses	4,946	5,082	10,220
	5,987	6,223	12,463
Research and development
- amortisation of internally generated assets	1,074	714	1,622
- other underlying operating expenses	7,339	7,011	14,377
	8,413	7,725	15,999
- amortisation of acquired intangible assets	165	829	1,097
	8,578	8,554	17,096
Administrative expenses
- share-based payments	1,766	980	2,889
- restructuring costs	-	-	44
- other underlying operating expenses	8,257	8,188	17,450
	10,023	9,168	20,383
Total operating expenses	24,588	23,945	49,942
Analysed as:
- amortisation of acquired intangible assets	1,206	1,970	3,340
- restructuring costs	-	-	44
- share-based payments	1,766	980	2,889
One-off and non-trading operating expenses excluded from adjusted profit	2,972	2,950	6,273
- amortisation of internally generated assets	1,074	714	1,622
- other underlying operating expenses	20,542	20,281	42,047
Total operating expenses	24,588	23,945	49,942

3 SHARE-BASED PAYMENTS

	Six months ended 31 October 2012	Six months ended 31 October 2011	Year  ended 30 April 2012
	£000	£000	£000
Equity settled	1,176	705	1,481
Cash settled	590	275	1,408
Share-based payments charge	1,766	980	2,889

The Group does not operate separate cash-settled share-based payment arrangements; however, the employer's NIC liability arising on the outstanding awards is treated as such an arrangement for accounting purposes.

4 Net finance charge

	Six months ended 31 October 2012	Six months ended 31 October 2011	Year  ended 30 April 2012
	£000	£000	£000
Finance income
Interest receivable and similar income	1	2	26
Interest on short-term deposits	24	215	237
Interest on extended payment terms	34	49	90
Total finance income	59	266	353
Finance charges
Bank loans and overdrafts	-	(78)	(84)
Other loans/commitment fees	(83)	(29)	(106)
Losses on financial instruments in a hedging relationship:
- Interest rate swaps and caps - cash flow hedges	-	(478)	(478)
- Cross currency swaps - net investment hedge	-	(347)	(347)
Other interest	-	-	(3)
Unwinding of discount on provisions 1	(21)	(51)	(92)
Finance charges before recycled hedge loss	(104)	(983)	(1,110)
Recycling of fair value loss on cash flow hedges 2	-	(42)	(42)
Total finance charges	(104)	(1,025)	(1,152)
Adjusted net finance charge before recycled hedge loss	(45)	(717)	(757)
Recycling of fair value loss on cash flow hedges 2	-	(42)	(42)
Net finance charge	(45)	(759)	(799)

1  The unwinding of discount on provisions relates to property and deferred consideration provisions.

2  The recycling of fair value loss on cash flow hedges arose due to the future repayments of the term loan reducing the interest payments causing some of the interest cash flows to be classed as no longer probable. In accordance with IAS 39, an equivalent proportion of the fair value losses under the interest rate swap arrangement, previously taken to equity, was released to profit and loss.

5 tax expense

Continuing operations	Six months ended 31 October 2012	Six months ended 31 October 2011	Year  ended 30 April 2012
	£000	£000	£000
Current tax
UK corporation tax	2,128	1,592	4,071
Foreign tax	1,391	1,571	2,774
	3,519	3,163	6,845
Adjustments in respect of prior years
UK corporation tax	-	-	86
	-	-	86
Total current tax expense	3,519	3,163	6,931
Deferred tax
UK	(48)	(123)	(180)
Foreign	(401)	(466)	(777)
Total deferred tax expense / (credit)	(449)	(589)	(957)
Total income tax expense	3,070	2,574	5,974

Income tax for the interim period is charged at 27.0% (October 2011: 28.5%), representing the weighted average of the estimated annual effective income tax rate expected to apply to adjusted profit for the full year in each jurisdiction and major category of income within continuing operations.  The equivalent weighted average rate on the statutory profit is 27.2% (October 2011: 30.2%).

Discontinued operations	Six months ended 31 October 2012	Six months ended 31 October 2011	Year  ended 30 April 2012
	£000	£000	£000
Current tax - Adjustments in respect of prior years
UK corporation tax	-	-	(2,253)
Total income tax credit	-	-	(2,253)

Tax (credit) / charge taken to equity	Six months ended 31 October 2012	Six months ended 31 October 2011	Year  ended 30 April 2012
	£000	£000	£000
Deferred tax relating to the translation adjustment to amortisation of acquired intangible assets	(31)	(50)	(257)
UK corporation tax relating to foreign exchange	-	-	450
Income tax relating to components of other comprehensive income	(31)	(50)	193
Tax relating to share-based payments	(536)	-	(1,818)
Total tax credit taken directly to equity	(567)	(50)	(1,625)

6 Earnings per share

The calculations of earnings per share are based on the Group profit for the period, adjusted profit¹ and weighted average number of shares in issue:

		Basic			Diluted
	Six months ended 31 October 2012	Six months ended 31October 2011	Year  ended 30 April  2012	Six months ended 31 October 2012	Six months ended 31 October 2011	Year  ended 30 April 2012
EPS summary
Basic EPS	2.9p	2.1p	6.5p	2.7p	1.9p	6.0p
Basic EPS for continuing operations	2.9p	2.1p	5.7p	2.7p	1.9p	5.3p
Adjusted EPS2	3.7p	2.8p	7.2p	3.4p	2.6p	6.7p
	Six months ended 31 October 2012	Six months ended 31October 2011	Year  ended 30 April  2012	Six months ended 31 October 2012	Six months ended 31October 2011	Year  ended 30 April 2012
	Pence per share	Pence per share	Pence per share	£000	£000	£000
Profit for the period	2.9	2.1	6.5	8,216	5,955	18,466
Profit from discontinued operations	-	-	(0.8)	-	-	(2,253)
Profit for the period on continuing operations	2.9	2.1	5.7	8,216	5,955	16,213
Reconciliation to adjusted profit:
Other gains and losses (net of tax)	-	(0.1)	(0.1)	-	(361)	(361)
Recycled hedge losses (net of tax)	-	-	-	-	31	31
Amortisation of acquired intangible assets (net of tax)	0.3	0.5	0.9	763	1,504	2,472
Share-based payments (net of tax)	0.5	0.3	0.7	1,425	763	2,103
Restructuring costs (net of tax)	-	-	-	-	-	32
Adjusted profit1	3.7	2.8	7.2	10,404	7,892	20,490

1  Profit from continuing businesses before other gains and losses, recycled hedge losses, amortisation of acquired intangible assets, share-based payments and restructuring costs.

2  Earnings per share on adjusted profit¹ have been included to give a clearer understanding of the results of the continuing businesses.

Number of shares ('000)	Six months ended 31 October 2012	Six months ended 31 October 2011	Year  ended 30 April 2012
Weighted average number of shares in issue - used to calculate basic earnings per share	284,009	283,902	283,597
Effect of potentially dilutive ordinary shares
- SAYE and share option schemes	24,034	24,562	24,255
Number of shares used to calculate diluted earnings per share	308,043	308,464	307,852

7 Net CASH

	31 October 2012	31 October 2011	30 April 2012
	£000	£000	£000
Cash and cash equivalents	16,832	22,632	16,947
Bank borrowings - current	-	(10,000)	-
Net cash	16,832	12,632	16,947

8 share capital

	Ordinary shares of 11.25p each		Deferred redeemable shares of £1 each
	Number	£000	Number	£000
Allotted, issued and fully paid:
At 1 May 2012	299,131,879	33,652	50,000	50
Issued during the period	220,941	25	-	-
At 31 October 2012	299,352,820	33,677	50,000	50

9 Dividends

The Company paid a final dividend of 1.125p (2011: 0.735p) per share, totalling £3,233,342 (2011: £2,102,975) on 23 October 2012.

10 Contingent liabilities

There are contingent liabilities that arise in the normal course of business in respect of indemnities, warranties, guarantees and legal claims. However, the Directors consider that none of these claims is expected to result in a material loss to the Group. There has been no change in the Directors' assumptions in regard to contingent liabilities since 30 April 2012.

11 RELATED PARTIES

Transactions between the company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not disclosed in this note.  There have been no material related party transactions in the period.

12 POST BALANCE SHEET EVENTS

There have been no material events post the balance sheet date that require disclosure.

 

END

 

 

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