Final Results
Clinical Computing PLC
30 March 2001
Clinical Computing plc
Preliminary Announcement of Results
For the year ended 31 December 2000
Chairman's and Chief Executive's Statement
In 2000 the Group produced a loss of £0.3 million, which translates into a
loss per share of 1.3p, which was not unexpected. We maintained a strong cash
position, £2.6 million, which will enable us to sustain the expansion of
Clinical Vision, our new suite of product solutions, and fund the costs of
rebuilding the Group's sales organisation and its marketing of the Clinical
Vision product line.
Financial
For the fiscal year 2000 overall costs for the Group decreased by £0.1 million
as compared with the same period for 1999. Turnover was down £0.9 million for
the year as compared with 1999, which was primarily the result of development
delays affecting software orders for Clinical Vision.
The Group continued the investment in Clinical Vision and increased its R&D
expenditure by £0.1 million to £1.0 million. During the second half of 2000
the US Sales team was strengthened and marketing of Clinical Vision commenced.
Sales expenditures for the fourth quarter of 2000 were 34% of the total for
the year, reflecting the increased focus on sales and marketing across the
Group.
Research and Development
During the second half of 2000 the Group extended its long-term development
strategy to carry through to the end of 2002. Implementation of this strategy
commenced in the third quarter of 2000.
Part of the strategy is the introduction of a dynamic software framework,
which is fully object oriented and platform independent, on which future
applications will run. The framework will further expedite the application
development process and allow us to bring applications to market more quickly
while reducing our overall development costs. It is expected that the
framework will also prove a source of substantial upgrade business.
The strategy has started with completing the renal functionality of Clinical
Vision and making it fully web enabled. Work on the web enablement will
continue throughout 2001 and will allow for the deployment of all our
applications over the internet.
Another part of the strategy is the integration of our Pocket CV. This is a
point-of-care, hand- held device used to store and collect the patient's data,
and then synchronizes the data with Clinical Vision. The Pocket CV will allow
for the clinician to have all the pertinent data available when at the
patient's side.
Business Development
We are pleased to report the sale of Clinical Vision to a customer in the
Republic of Ireland. In the fourth quarter of 2000 we appointed in the UK a
Business Development Manager for Europe. We are now in position to commence
marketing Clinical Vision in continental Europe.
We have completed the move of our US headquarters to new facilities. This will
provide for staff expansion and more useable space at a lower cost, while
maintaining a more suitable facility for US corporate visits.
We have discussions under way both in the UK and the US with a number of
institutions relating to building new Clinical Vision applications. These
include the building of a disease state management system (DSM) that will
integrate with all Clinical Vision applications and provide a superior
clinical solution to the healthcare marketplace.
We recognise the hard work and commitment of our employees for which we
continue to be most grateful.
M Gordon J Richardson
Chairman Chief Executive
Financial Review
For 2000 the Group's operating result was a loss of £0.49 million recorded
from a turnover of £2.26 million. After the addition of net interest income of
£0.16 million, loss on ordinary activities for the year was reduced to £0.33
million. Loss per share was 1.3p. The Group's cash position at the year-end
was £2.6 million, net cash outflows during the year were £0.18 million.
Operating results
Group turnover recorded for the year was £2.26 million, this represents a
decrease of 27% on the level of turnover recorded for the prior year. Turnover
arising in the UK decreased by 12% and in the US it decreased by 31%. Total
maintenance revenues decreased by 10% but still accounted for 65% of the
Group's turnover. In the UK and the US software and services revenues
decreased by 38%, and resales of hardware were negligible. The decreases in
all these classes of revenue experienced during 2000 were a result of
declining RENLStar and di-Proton sales, which because of development delays
were not replaced by orders for the new Clinical Vision system.
Total costs for the Group in 2000 were £2.75 million, which is marginally less
than the totals recorded for the previous three years. Overall staffing levels
in both the UK and the US were held constant except that the sales and
marketing headcount expanded towards the end of the year. Expenditure on
research and development increased by 14% but other costs of sales decreased
in line with the rate of decrease in turnover. Distribution costs increased by
15% as a result of an expanded sales force and increased sales activity in the
final quarter of the year. Administrative expenses decreased by 13%, partly as
a result of exchange gains of £0.15 million.
Capital Expenditure
During 2000 the Group spent approximately £0.13 million on capital expenditure
for both the UK and US offices. Approximately half of this expenditure was
used to acquire new software releases and improved hardware to further the
development process of Clinical Vision. The majority of the other half was
used for leasehold improvements and furnishings for the new US office
premises, and the balance was spent on new sales and marketing equipment and
materials.
Interest
Interest income of £0.16 million was earned on the Group's cash balances
during the year. This was an increase of 31% on last year's total. Total cash
balances held across the Group during 2000 and the interest rates applied to
them were on average higher than in 1999.
The Group did not incur any interest or finance charges during the year.
Cash flows
The Group started the year with total cash balances of £2.78 million and ended
it with cash balances of £2.6 million. The net cash outflow of £0.18 million
was initiated in the final quarter of 2000 when there was an increase in sales
and marketing activities across the Group and the US office was moved to new
premises.
Taxation
As in prior years both the UK and US operating companies retain substantial
tax losses for use against future years' trading profits.
Foreign Currency
In 2000 the Group earned approximately 75% of its revenues in US dollars but
had a disproportionate amount of costs in UK sterling. In January 2000, the
sterling exchange rate was around $1.62, however in the second half of the
year it weakened against the US dollar with exchange rates in the range $1.42
to $1.51. These accounts have been prepared using a year end exchange rate of
£1:$1.4938 (1999: $1.6117) and an average exchange rate for the year of £1:
$1.5136 (1999: $1.6141).
P Smart
Finance Director
Consolidated Profit and Loss Account
For the year ended 31 December 2000
2000 1999
£ £
Turnover 2,259,201 3,112,623
-------- --------
Cost of sales
Research and development (1,013,777) (886,054)
Other (585,377) (779,985)
-------- --------
(1,599,154)(1,666,039)
-------- --------
Gross profit 660,047 1,446,584
Distribution costs (including sales and marketing) (475,458) (412,649)
Administrative expenses (671,078) (768,678)
-------- --------
(1,146,536)(1,181,327)
-------- --------
Operating (loss) profit (486,489) 265,257
Interest receivable (net) 157,816 117,079
-------- --------
(Loss) profit on ordinary activities before and after
taxation, being the retained result for the year
(328,673) 382,336
-------- --------
Basic and diluted (loss) earnings per share (1.3p) 1.5p
-------- --------
All amounts relate to continuing operations
Consolidated Statement of Total Recognised Gains and Losses
For the year ended 31 December 2000
2000 1999
£ £
(Loss) profit for the financial year (328,673) 382,336
Loss on foreign currency translation (48,833) (25,297)
--------- ---------
Total recognised gains and losses relating to the year (377,506) 357,039
--------- ---------
All amounts relate to continuing operations
Consolidated Balance Sheet
31 December 2000
2000 1999
£ £
Fixed assets
Tangible assets 338,557 345,461
--------- ---------
Current assets
Stocks 41,500 41,500
Debtors 567,633 748,122
Cash at bank and in hand (including short term 2,599,647 2,793,572
deposits)
--------- ---------
3,208,780 3,583,194
--------- ---------
Creditors: Amounts falling due within one year
Deferred income (644,796) (649,687)
Other (303,340) (307,761)
--------- ---------
(948,136) (957,448)
--------- ---------
Net current assets 2,260,644 2,625,746
--------- ---------
Net assets 2,599,201 2,971,207
________ ________
Capital and reserves
Called-up share capital 1,254,016 1,254,016
Share premium account 4,248,388 4,248,388
Profit and loss account (2,903,203) (2,531,197)
--------- ---------
Shareholders' funds - all equity 2,599,201 2,971,207
--------- ---------
Consolidated Cash Flow Statement
For the year ended 31 December 2000
2000 1999
£ £
Net cash (outflow) inflow from operating activities (146,681) 522,879
-------- --------
Returns on investments and servicing of finance 157,816 117,079
Capital expenditure (132,911)(158,222)
-------- --------
24,905 (41,143)
-------- --------
Cash (outflow) inflow before management of Liquid resources (121,776) 481,736
and financing
Management of liquid resources 446,961(450,573)
Financing - (20,061)
-------- --------
Increase in cash in the year 325,185 11,102
-------- --------
1. Segmental analysis
Turnover
An analysis of Group turnover by geographical region of origin is given below:
2000 1999
£ £
UK 445,871 548,626
USA 1,736,683 2,518,884
Other 76,647 45,113
--------- ---------
2,259,201 3,112,623
--------- ---------
Turnover by destination is not materially different
from that by origin.
The Directors consider that the Group operates in one class of business.
However, turnover is derived as follows:
2000 1999
£ £
Software systems and upgrades 584,123 748,285
Maintenance support 1,461,294 1,625,676
Services 142,610 433,325
Hardware sales and upgrades 17,480 205,498
Other 53,694 99,839
--------- ---------
2,259,201 3,112,623
--------- ---------
Analyses by origin are as follows:
2000 UK USA Total
and other
£ £ £
Turnover 522,518 1,736,683 2,259,201
--------- --------- ---------
Operating loss (73,922) (412,567) (486,489)
--------- --------- ---------
Net assets (liabilities) 3,558,014 (958,813) 2,599,201
--------- --------- ---------
1999 UK USA Total
and other
£ £ £
Turnover 593,739 2,518,884 3,112,623
--------- --------- ---------
Operating profit 53,023 212,234 265,257
--------- --------- ---------
Net assets (liabilities) 3,531,147 (559,940) 2,971,207
--------- --------- ---------
2. Earnings per share
Basic earnings per share are based upon the loss attributable to shareholders
of £328,673 (1999: profit of £382,336) and weighted average number of shares
in issue during the year of 25,080,310 (1999: 25,080,310).
Diluted earnings per share are based upon the loss attributable to
shareholders of £328,673 (1999: profit of £382,336) and weighted average
number of shares in issue during the year of 25,321,638 (1999: 25,087,348),
allowing for the exercise of all outstanding share options.
3. Reconciliation of operating (loss) profit to operating cash flows
2000 1999
£ £
Operating (loss) profit (486,489) 265,257
Depreciation charge 153,960 143,904
Loss on disposal of tangible fixed assets 1,523 -
Decrease in debtors 211,548 313,104
Decrease in creditors (32,723) (204,886)
Share options issued at a discount 5,500 5,500
-------- --------
Net cash (outflow) inflow from operating activities (146,681) 522,879
-------- --------
4. Analysis of cash flows
2000 1999
£ £
Returns on investments and servicing of finance
Interest received 157,816 120,708
Interest element of finance lease rentals - (3,629)
--------- ---------
Net cash inflow 157,816 117,079
--------- ---------
Capital expenditure
Purchase of tangible fixed assets (132,911) (176,063)
Sale of tangible fixed assets - 17,841
--------- ---------
Net cash outflow (132,911) (158,222)
--------- ---------
Management of liquid resources
Decrease (increase) in short term deposits 446,961 (450,573)
--------- ---------
Net cash inflow (outflow) 446,961 (450,573)
--------- ---------
Financing
Capital element of finance lease rental payments - (20,061)
--------- ---------
Net cash outflow - (20,061)
--------- ---------
5. Analysis and reconciliation of net funds
1 January Exchange 31 December
2000 Cash flow Movement 2000
£ £ £ £
Cash in hand at bank 280,311 325,185 (140,482) 465,014
Overdraft (11,615) 10,067 - (1,548)
Short term deposits 2,513,261 (446,961) 68,333 2,134,633
________ ________ ______ _________
Net funds 2,781,957 (111,709) (72,149) 2,598,099
________ ________ ______ _________
2000 1999
£ £
Increase in cash in the year (including overdrafts) 335,252 11,102
Cash inflow from decrease in lease financing - 20,061
Cash (outflow) inflow from movement in liquid resources (446,961) 450,573
________ _______
Change in net funds resulting from cash flows (111,709) 481,736
Exchange movement (72,149) (1,955)
________ ________
Movement in net funds in year (183,858) 479,781
Net funds at beginning of year 2,781,957 2,302,176
________ ________
Net funds at end of year 2,598,099 2,781,957
________ ________
The financial information contained in this preliminary announcement of
audited results does not constitute the Group's statutory accounts for the
year ended 31 December 2000 and 31 December 1999. The accounts for the year
ended 31 December 1999 have been delivered to the Registrar of Companies. The
statutory accounts for the years ended 31 December 1999 and 2000 have been
reported on by the company's auditors; the reports on these accounts were
unqualified and they did not contain any statement under section 237 (2) or
(3) of the Companies Act 1985.
The statutory accounts for the year ended 31 December 2000 have been prepared
using the same existing policies as the accounts for the year ended 31
December 1999.
The accounts for the year ended 31 December 2000 are expected to be posted to
shareholders in due course and will be delivered to the Registrar of Companies
after they have been laid before the company in a general meeting on 2 May
2001.
Copies will also be available from the principal office of the company: 4 The
Thameside Centre, Kew Bridge Road, Brentford, Middlesex, TW8 0HF.
End
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