Interim Results

RNS Number : 5765P

OMG PLC

09 June 2015

 

9 June 2015

OMG plc

("OMG" or the "Group")

Interim Results for the six months ended 31 March 2015

OMG plc (LSE: OMG), the technology group providing Computer Vision products and services for the entertainment, life science, engineering industries and consumer electronics markets, announces interim results for the six months ended 31 March 2015.

Financial Key Points from continuing operations

For comparative purposes the performance of 2d3 has now been classified as a discontinued operation in these results.

·      Group Revenue of £11.3m down 4.4% (H1FY14: £11.8m)

o Revenue impacted by single large Vicon deal, expected in H1 but delivered early in H2

·      Group adjusted* loss before tax of £0.7m (H1FY14: adjusted* loss before tax of £0.6m)

o Overall, Group trading is in line with achieving market expectations for the full year

·      Group cash position increased from £6.5m to £8.6m in the period

o Post period end, cash position following disposal of 2d3 stood at £21.7m as at 10 April 2015

·      Dividend of 4.5p paid on 15 May 2015 returning £5.1m of 2d3 proceeds to shareholders

·      Further Special Dividend announced today of 5p per share returning £5.7m proceeds to shareholders

Operational Key Points

Vicon

o Secured a variety of deals across a number of industry sectors

o Motion capture used in recent film releases: Paddington, Jupiter Ascending and American Sniper

o Released Vicon Lock, a new control system for connecting, integrating and synchronizing third-party devices with Vicon systems, including the Bonita camera

o Commenced Innovate UK project with the aim of developing new, innovative technologies to drive future growth and profits

·      Yotta

o Secured new customers for Horizons: Southampton City Council & Herefordshire County Council

o Yotta won its first Horizons customer in Scotland with North Ayrshire

o Mayrise software wins at Doncaster MBC and Portsmouth City Council

o Synergy between the Horizons and Mayrise applications seen in win with Newport City Council

o Post-period end, Yotta expanded into Europe, securing its first software contract outside the UK with a Dutch infrastructure services company

·      2d3

o Post period end, successful sale of 2d3

o Sold to Insitu Inc., a subsidiary of The Boeing Company, for $25m (approx. £16.8m)

o Profit before tax of the transaction of $16.4m (approx. £11.0m)

o Net cash generated from the transaction of $16.9m (approx. £11.3m)

o Sale reduces volatility of Group revenue and profit streams and enhances future visibility of earnings

·      OMG Life

o Life is now well positioned to realise value from its IP with a strong pipeline of opportunities

o Continue to receive interest in IP from a wide variety of consumer technology businesses

o Two potential licensees have now entered more formal negotiations, which remain ongoing

* Profit before tax from continuing operations before group recharges adjusted for share based payments, amortisation of intangibles arising on acquisition, fair value adjustment to contingent consideration, unwinding of discount on contingent consideration, acquisition costs and redundancy costs.

 Commenting on the results Nick Bolton, Chief Executive Officer said:

"The Group has made strong progress in the first half. We are pleased that our efforts to realise value for shareholders continued with the successful sale of 2d3, which even after the payment of dividends strengthens the Group's healthy cash resources and creates a revenue base that is expected to be smoother and more predictable moving forward.

As we enter the second half, we believe that we have a solid platform in place and we remain focused on actively pursuing new routes such as licensing or partnership to maximise the value of our IP and to generate further shareholder value."

For further information please contact:

OMG plc	[phone]
Nick Bolton, CEO
David Deacon, CFO
FTI Consulting	[phone]
Matt Dixon / Emma Appleton / Harry Staight
N+1 Singer (NOMAD to OMG)	[phone]
Shaun Dobson / Jen Boorer

About OMG plc

OMG plc (Oxford Metrics Group. LSE: OMG) is a group of technology companies producing Computer Vision products and services for the entertainment, life science, engineering industries and consumer electronics markets.

The Group's technology is used globally to capture the movements of actors (for the movie industry), sportsmen and women (for video games or improving team performance), and children with cerebral palsy, rehab patients and animals (for medical, life science and research industries). The technology is also used for the management of highways and other forms of distributed infrastcture assets, such as lighting systems and other street furniture. Through this diverse offering the Group has earned its strong international reputation for precision from pixels and its unique expertise in imaging technology.

Founded in 1984, the Group is headquartered in Oxford, UK, and has two offices in the US and four in the UK. It has customers in over 50 countries and is a quoted company listed on AIM, a market operated by the London Stock Exchange. The Group trades through three subsidiaries: Vicon, the world's largest motion capture and movement analysis company, Yotta, a provider of software and services for infrastructure asset management and OMG Life, our IP licensing business, which is focused on unlocking latent value in OMG's IP.

The Group's global clients spanning the worlds of science, medicine, sport, engineering, gaming, film and broadcast include: major hospitals and research facilities such as Guy's Hospital, Nuffield Orthopedic Centre, Headley Court and Loughborough University, engineering industry leaders including: Ford Motor Company, BMW, Toyota and European Space Agency and in the entertainment sector; The Imaginarium, Sony, Industrial Light and Magic, Sega, Nintendo, UbiSoft, EA and Square Enix. In infrastructure asset management, clients include Highways England, East Sussex, Kent, Lancashire, Transport for London, UK Power Network, Cheshire East and West as well as many others.

 Chairman and Chief Executive's Statement

Overall, the Group has had a good start to 2015. Vicon has delivered a solid first half performance with notable wins across all of its markets; Yotta has delivered improved revenues and profits driven by the continued success of its software business; and OMG Life continues to attract interest from several consumer technology businesses with formal licensing discussions ongoing.

The first six months of the financial year has seen the shape of the Group develop well through a number of strategically important and proactive changes that have been made in the business. The most significant development was the sale of our 2d3 defence software division to Insitu Inc., a subsidiary of The Boeing Company on 10 April 2015, for $25m (approx. £16.8m). This move was a positive and important step for the Group as it delivered on the founding ambition of OMG - to take great technology, nurture it, build it, amplify the value through acquisition and ultimately realise meaningful shareholder value from those efforts.

The disposal of 2d3 reduces the volatility of Group revenue and profit streams and enhances future visibility of earnings. This transaction combined with the disposal of House of Moves in October 2014, means that the Group has emerged as a more predictable business. 2d3 and the cash it has provided has emboldened our position. Our strategy has not changed and moving forward, we will continue to seek maximum shareholder returns. 2d3 will no doubt continue to thrive as part of Insitu Inc., and we would like to take this opportunity to wish our former colleagues success in the future. For comparative purposes the performance of 2d3 has now been classified as a discontinued operation in these results.

In addition to the 4.5p per share special dividend announced following the disposal of 2d3, the Group is pleased to announce a further Special Dividend of 5.0p per share will be paid on 10 July 2015, following an ex-dividend date of 18 June 2015 to all shareholders on the register on 19 June 2015.

Financial Summary

KPI	H1 FY15	H1 FY14	Change
Group Revenue	£11.3m	£11.8m	-£0.5m
Group Cash Position	£8.6m	£6.5m	+£2.1m
Group Adjusted* Loss before Tax	(£0.7m)	(£0.6m)	-£0.1m

During the first half, Group revenue decreased year-on-year by 4.4% to £11.3m (H1 FY14: £11.8m). This change in revenue is accounted for by a single large Vicon deal which was expected in the first half, but was delivered early in this current second half. This has also had a follow on impact on reported profits and accordingly the Group reports an adjusted loss before tax for the period of £0.7m (H1 FY14: loss before tax of £0.6m).  

Group cash position as at 31 March 2015 stood at £8.6m (H1 FY14: £6.5m). Post period end, following the successful sale of 2d3 cash strengthened to £21.7m as at 10 April 2015 prior to the payment of a £5.1m Special Dividend.

OMG Vicon

	Revenue		PBT		Adjusted* PBT
	H1 FY15	H1 FY14	H1 FY15	H1 FY14	H1 FY15	H1 FY14
Vicon UK / ROW	£4.5m	£4.9m	£1.3m	£1.5m	£1.0m	£1.3m
Vicon US	£3.1m	£3.3m	£0.1m	£0.1m	£0.8m	£1.0m
Total Vicon	£7.7m	£8.2m	£1.4m	£1.6m	£1.8m	£2.3m

Our Vicon business reported a solid start to FY15. Revenues in UK / Rest of World ("ROW") were slightly lower compared with a year ago by 7.0% which is accounted for by one significant deal moving into the second half which Vicon has now delivered. Vicon reported an adjusted profit before tax of £1.8m (H1 FY14: £2.3m). The decline is primarily attributed to lower revenues and additional costs associated with the Innovate UK project. Vicon gross margins were slightly better compared to the prior year and the business is currently undergoing a programme of modest cost reductions which will lower the cost base.

The first half saw Vicon win a variety of deals in a number of sectors such as automotive (Suzuki, Maserati), education (Gallaudet University for sign language studies), Gaming (EA and Capcom), industrials (Boeing), retail (Champion Sport Wear for clothes design) and technology (Clearpath Robotics). In addition, our technology has been used in recent film releases including Paddington, Jupiter Ascending and American Sniper.

During the period, Vicon's development efforts saw the release of Vicon Lock, the division's new control system for connecting, integrating and synchronizing third-party devices with Vicon systems which is expected to enhance the accessibility of our highly popular Bonita camera series.

At the time of our Preliminary Results in December 2014, it was highlighted that Vicon had been awarded a grant by Innovate UK. This project has recently begun and we are using the grant to help develop new, innovative technologies to drive future growth and profits. Whilst there is a net cost to Vicon in the short-term the project is expected to deliver new adjacent technologies, which will help to drive growth in future years.

Overall, the outlook for Vicon in the second half remains solid and is expected to have a stronger trading period than the first half, which has often been the case in previous years, and is on track to deliver expectations.

OMG Yotta

	Revenue		PBT		Adjusted* PBT
	H1 FY15	H1 FY14	H1 FY15	H1 FY14	H1 FY15	H1 FY14
Yotta	£3.6m	£3.3m	(£0.1m)	(£0.2m)	£0.5m	£0.3m

Yotta reported revenues up 8.7% compared to the same period last year at £3.6m (H1 FY14: £3.3m). This increase has been achieved through the growth of the software and consulting services parts of the business. Yotta reported an adjusted profit before tax of £0.5m (H1 FY14: £0.3m).

Yotta's Horizons, its SaaS Visualised Asset Management system, continued to see strong growth and the UK now has 46 (H1 14: 37) customers. Yotta secured new customers for Horizons during the half including Southampton City Council, Herefordshire County Council and North Ayrshire, which is Yotta's first Horizons customer in Scotland. Post-period end, Yotta also expanded its reach into Europe, securing a contract with De Jong Zuurmond, a Dutch infrastructure services company, via Yotta's new distributor Wegdekmeten. This is the first order and application of Horizons outside of the UK, it represents a major milestone as the business shifts to be more SaaS orientated, and further international opportunities are being explored.

Further, Yotta also secured wins for its Mayrise software with Doncaster MBC and Portsmouth City Council among the highlights. The company continues to see synergy between the Horizons and Mayrise applications, exemplified in the recent win at Newport City Council, who continued to expand their use of Yotta's applications with the purchase of Horizons and mobile functionality for their Mayrise system.

The continued success of Horizons and Mayrise has seen increased engagement with our customers and high levels of customer retention. Demand for our consulting services has been high with year-on-year revenues up by 13% and has led Yotta to deliver a wide range of software and non-software related services to many customers, from training to strategic-level Asset Management advice.

The combined software and services business now has annual recurring revenues of £3.1m (H1 FY14: £2.4m) and software and related revenues accounted for 61% of H1 revenues (H1 FY14: 46%).

The surveying activities also saw success. Notable wins included Amey Plc, Cumbria County Council, Lincolnshire County Council, Rochdale MBC, Hertfordshire County Council and Milton Keynes. The development of Yotta's new Asset Video capture machine was also underway during the period and it will be carrying out contracts in the second half. Whilst Yotta's surveying activities were hampered by the wet winter, on a positive note the surveying teams have won new business with Hounslow Highways as well as with Liverpool, Hertfordshire and Hampshire Councils.

Yotta continues to grow as it evolves into an increasingly reliable, recurring-revenue based software and services business. The outlook for the second half is encouraging for Yotta and the division remains on track to deliver expectations.

 OMG Life

	Revenue		PBT		Adjusted* PBT
	H1 FY15	H1 FY14	H1 FY15	H1 FY14	H1 FY15	H1 FY14
Life	£0.0m	£0.3m	(£2.7m)	(£2.2m)	(£1.7m)	(£2.1m)

The reported adjusted loss for OMG Life of £1.7m (H1: FY14 loss: £2.1m) includes the full-write-down of previously capitalised Autographer specific IP of £0.8m (H1 FY14 £0.5m). The one-off costs associated with the termination of staff and relationship with our contract manufacturer have been reported as exceptional costs. The revised cost base of £0.9m per year partially benefited the first half and will fully benefit the second half. The Balance Sheet includes capitalised R&D of £1.3m (H1 FY14: £1.8m) relating to image capture IP.

This IP enables the capture of optimal imagery, including both video and stills. This means consumers can get a high quality shot or video sequence regardless of camera motion, difficult lighting conditions or even photographic ability, even with relatively low cost components. The development of these capabilities has proven timely as manufacturers seek to realise differentiation in the rapidly growing marketplaces of action cameras and newer social cameras and in the more traditional tablet and smartphone markets.

We continue to receive interest from a wide variety of consumer technology businesses, who have seen the promise and potential in the core IP within Life. These initial conversations have since evolved into detailed discussions as to how the technology can be best utilised within the potential licensees' forthcoming product ranges. These discussions continue with a relatively large number of organisations but two specific licensees have now entered more formal negotiations. These remain ongoing and we are focused on securing a tangible benefit in H2 2015 to underpin the confidence in the division's expectations for the year as a whole. Life is now well positioned to realise value from its IP and we remain excited about the future potential for the OMG Life business in its new form and see valuable opportunities ahead.

Outlook

Post 2d3, our strategy remains to generate shareholder value by taking world-class IP, developed primarily in Britain, and monetizing it through commercial sales. This is something we have proven we can do throughout our history - be that through building up Vicon to a position of profitable market leadership; through the scale up and sale of 2d3 to a strong partner for a significant premium; and indeed in the potential Yotta is now showing as an increasingly visible, dependable revenue performer.

Looking ahead, OMG will continue to build out the predictability and profitability of our Group revenue streams and will consider new routes such as licensing or partnership to maximise the value of our IP. Where possible we will continue to embolden our position via further corporate activity, where it enhances the quality of our revenue base.

With our strategic priorities unchanged, The Board remains confident in the strength of our diversified offering and position in key global markets; and thus of our ability to deliver sustained, balanced and profitable growth over the long term.

As we enter the second half notwithstanding macro-economic uncertainty, the Board is confident that with the expected performance across the three divisions the Group is on track to meet current market expectations for the year as a whole.

CONDENSED CONSOLIDATED INCOME STATEMENT

			Six months ended 31 March 2015 (unaudited)			Six months ended 31 March 2014 restated (unaudited)			Year ended 30 September 2014 restated (audited)
			Continuing operations	Discontinued operations	Total	Continuing operations	Discontinued operations	Total	Continuing operations	Discontinued operations	Total
		Note	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
	Revenue	2	11,316	2,028	13,344	11,842	2,493	14,335	25,631	7,810	33,441
	Cost of sales		(4,276)	(894)	(5,170)	(4,908)	(996)	(5,904)	(9,704)	(3,046)	(12,750)
	Gross profit		7,040	1,134	8,174	6,934	1,497	8,431	15,927	4,764	20,691
	Sales, support and marketing costs		(2,465)	(259)	(2,724)	(2,752)	(737)	(3,489)	(6,194)	(372)	(6,566)
	Research and development		(2,323)	(235)	(2,558)	(1,713)	(760)	(2,473)	(4,038)	(222)	(4,260)
	Administrative expenses		(3,650)	(2,137)	(5,787)	(3,318)	(1,258)	(4,576)	(5,802)	(4,700)	(10,502)
	Other operating income		33	-	33	23	-	23	56	6	62
	Operating loss		(1,365)	(1,497)	(2,862)	(826)	(1,258)	(2,084)	(51)	(524)	(575)
	Finance income		17	-	17	5	6	11	6	-	6
Finance expense			(5)	(3)	(8)	(5)	(3)	(8)	(10)	(5)	(15)
	Loss before taxation	2,3	(1,353)	(1,500)	(2,853)	(826)	(1,255)	(2,081)	(55)	(529)	(584)
	Taxation	4	775	111	886	149	449	598	(49)	63	14
	Loss for the period attributable to owners of the parent during the period		(578)	(1,389)	(1,967)	(677)	(806)	(1,483)	(104)	(466)	(570)
	Basic loss per share (pence)	5	(0.51)p	(1.22)p	(1.73)p	(0.62)p	(0.74)p	(1.36)p	(0.09)p	(0.42)p	(0.51)p
	Diluted loss per share (pence)	5	(0.51)p	(1.22)p	(1.73)p	(0.62)p	(0.74)p	(1.36)p	(0.09)p	(0.42)p	(0.51)p

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

		Six months ended 31 March 2015	Six months ended  31 March 2014	Year ended  30 September 2014
		(unaudited)	(unaudited)	(audited)
		£'000	£'000	£'000
Net loss for the period		(1,967)	(1,483)	(570)
Other comprehensive income
Exchange differences on retranslation of overseas subsidiary		471	(109)	20
Tax recognised directly in equity		221	(6)	23
Total other comprehensive income		692	(115)	43
Total comprehensive income for the period attributable to the owners of the parent		(1,275)	(1,598)	(527)

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

		31 March 2015	31 March 2014	30 September 2014
		(unaudited)	(unaudited)	(audited)
	Note	£'000	£'000	£'000
Non-current assets
Goodwill and intangible assets		12,255	17,395	16,686
Property, plant and equipment		1,184	2,156	1,387
Financial asset - investment		69	69	69
Deferred consideration receivable		319	-	-
Deferred tax asset		985	1,441	614
		14,812	21,061	18,756
Current assets
Inventories		1,683	2,322	1,691
Trade and other receivables		7,976	9,682	13,176
Cash and cash equivalents		8,563	6,529	7,579
		18,222	18,533	22,446
Assets classified as held for sale		5,528	-	720
Current liabilities
Trade and other payables		(6,237)	(7,262)	(8,640)
Current tax liabilities		(8)	(117)	(139)
		(6,245)	(7,379)	(8,779)
Liabilities directly associated with assets classified as held for sale		(1,634)	-	(45)
Net current assets		15,871	11,154	14,342
Total assets less current liabilities		30,683	32,215	33,098
Non-current liabilities
Financial liabilities		-	(7)	-
Deferred tax liability		(1,578)	(2,451)	(2,280)
		(1,578)	(2,458)	(2,280)
Net assets		29,105	29,757	30,818
Capital and reserves attributable to the owners of the parent
Share capital	6	283	283	283
Shares to be issued		65	65	65
Share premium account		15,443	15,443	15,443
Merger reserve		6,589	6,589	6,589
Retained earnings		6,309	7,561	8,493
Foreign currency translation reserve		416	(184)	(55)
Total equity shareholders' funds		29,105	29,757	30,818

CONDENSED CONSOLIDATED STATEMENT OF CASHFLOWS

		Six months ended 31 March 2015	Six months ended 31 March 2014	Year ended 30 September 2014
		(unaudited)	(unaudited)	(audited)
		£'000	£'000	£'000
Cash flows from operating activities
Operating (loss)/profit		(1,365)	(2,084)	414
Depreciation and amortisation		1,470	1,757	3,511
Impairment of intangibles		415	-	287
(Profit)/loss on sale of property, plant and equipment		(69)	(1)	4
Loss on disposal of discontinued operations		167	-	-
Share based payments		114	199	189
Exchange adjustments		(36)	181	27
Decrease/(increase) in inventories		50	(495)	145
Decrease/(increase) in receivables		1,173	1,120	(2,008)
(Decrease)/increase in payables		(327)	212	1,240
Cash generated from continuing operations		1,592	889	3,809
Discontinued operations		1,248	-	(221)
Cash generated from operating activities		2,840	889	3,588
Tax received/(paid)		12	(270)	(261)
Net cash from operating activities		2,852	619	3,327
Cash flows from investing activities
Purchase of property, plant and equipment		(321)	(471)	(712)
Purchase of intangible assets		(1,289)	(1,048)	(2,533)
Proceeds on disposal of property, plant and equipment		181	141	292
Proceeds from the sale of discontinued operations net of cash disposed of		255	-	-
Interest received		12	11	6
Net cash used in investing activities		(1,162)	(1,367)	(2,947)
Cash flows from financing activities
Payment of finance lease liabilities		(45)	(55)	(111)
Interest element of finance lease repayments		(5)	(5)	(10)
Other interest paid		(3)	(3)	(5)
Equity dividends paid		(567)	(429)	(429)
Net cash used in financing activities		(620)	(492)	(555)
Net increase/(decrease) in cash and cash equivalents		1,070	(1,240)	(175)
Cash and cash equivalents at beginning of the period		7,628	7,803	7,803
Effect of exchange rate changes		160	(34)	-
Cash and cash equivalents at end of the period		8,858	6,529	7,628
Amount included in cash and cash equivalents		8,563	6,529	7,579
Amount included in assets classified as held for sale		295	-	49
Total cash and cash equivalents at end of the period		8,858	6,529	7,628

CONDENSED CONSOLIDATED STATEMENT OF CHANGES TO EQUITY

	Share Capital	Shares to be issued	Share premium account	Merger reserve	Retained earnings	Foreign currency translation reserve	Total
	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Balance as at 1 October 2014	283	65	15,443	6,589	8,493	(55)	30,818
Net loss for the period	-	-	-	-	(1,967)	-	(1,967)
Exchange differences on retranslation of overseas subsidiaries	-	-	-	-	-	471	471
Tax recognised directly in equity	-	-	-	-	221	-	221
Transactions with owners:
Dividends	-	-	-	-	(567)	-	(567)
Movement in relation to share based payments	-	-	-	-	129	-	129
Balance as at 31 March 2015	283	65	15,443	6,589	6,309	416	29,105
Balance as at 1 October 2013	260	65	15,443	4,008	9,280	(75)	28,981
Net loss for the period	-	-	-	-	(1,483)	-	(1,483)
Exchange differences on retranslation of overseas subsidiaries	-	-	-	-	-	(109)	(109)
Tax recognised directly in equity	-	-	-	-	(6)	-	(6)
Transactions with owners:
Dividends	-	-	-	-	(429)	-	(429)
Issue of share capital	23	-	-	2,581	-	-	2,604
Movement in relation to share based payments	-	-	-	-	199	-	199
Balance as at 31 March 2014	283	65	15,443	6,589	7,561	(184)	29,757
	Share Capital	Shares to be issued	Share premium account	Merger reserve	Retained earnings	Foreign currency translation reserve	Total
	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Balance as at 1 October 2013	260	65	15,443	4,008	9,280	(75)	28,981
Net loss for the year	-	-	-	-	(570)	-	(570)
Exchange differences on retranslation of overseas subsidiaries	-	-	-	-	-	20	20
Tax recognised directly in equity	-	-	-	-	23	-	23
Transactions with owners:
Dividends	-	-	-	-	(429)	-	(429)
Issue of share capital	23	-	-	2,581	-	-	2,604
Movement in relation to share based payments	-	-	-	-	189	-	189
Balance as at 30 September 2014	283	65	15,443	6,589	8,493	(55)	30,818

The accompanying notes are an integral part of this interim financial information

NOTES TO THE CONDENSED CONSOLIDATED INTERIM STATEMENTS

1.  Basis of preparation

OMG Plc (the "Company") is a company domiciled in England.  The condensed consolidated interim financial statements of the Company for the six months ended 31 March 2015 comprise the Company and its subsidiaries (together referred to as the "Group").

The following IFRIC amendments and IASs have been issued by the IASB, but are applicable to future periods. They are not expected to have any material impact on the Group's reporting:

·      IFRS 5 'Non-current Assets Held for Sale and Discontinued Operations'

·      IFRS 9 'Financial Instruments'

·      IFRS 10 'Consolidated Financial Statements'

·      IFRS 12 'Disclosure of Interests in Other Entities'

·      IFRS 15 'Revenue from contracts with customers'

·      IAS 24 'Related Party Disclosures' (revised)

·      IAS 27 'Separate Financial Statements' (revised)

·      Amendment to IAS 32 'Financial Instruments: Presentation'

·      Amendment to IAS 36 'Impairment of Assets'

Otherwise, the condensed consolidated interim financial statements have been prepared using accounting policies consistent with those of the annual financial statements for the year ended 30 September 2014.  They are in accordance with IAS 34.

The interim financial statements have not been audited or reviewed and the financial information contained in this report does not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006. The comparative figures for the year ended 30 September 2014 are not the statutory accounts but have been extracted from the Group's 2014 financial statements which have been delivered to the Registrar of Companies.The auditors' report on those financial statements was unqualified did not contain references to any matters to which the auditors drew attention without qualifying the report and did not contain a statement under Section 498(2) or (3) of the Companies Act 2006. 

2.  Segmental reporting

Segment information is presented in the condensed consolidated interim financial statements in respect of the Group's business segments, which are reported to the Chief Operating Decision Maker (CODM). The Group has identified the Board of Directors of OMG plc ("the Board") as the CODM. The business segment reporting reflects the Group's management and internal reporting structure.

The Group comprises the following business segments:

Vicon Group:  This is the development, production and sale of computer software and equipment for the entertainment, engineering and life science markets;

Yotta Group:  This is services for the management of infrastructure and taxation, highway surveying and associated software development;

2d3 Group:  This is the development and sale of computer software for the defence market;

OMG Life:  This is the consumer electronics segment.

Other unallocated costs represent head office expenses not recharged to subsidiary companies.

Business segments are analysed below:

	Revenue
	Six months ended 31 March 2015 (unaudited)	Six months  ended 31 March 2014 restated (unaudited)	Year ended 30 September 2014 restated   (audited)
	£'000	£'000	£'000
Vicon UK	4,547	4,923	9,626
Vicon USA	3,108	3,304	7,556
Vicon Group	7,655	8,227	17,182
Yotta UK	2,321	2,194	5,397
Yotta Mayrise	1,302	1,140	2,505
Yotta Group	3,623	3,334	7,902
OMG Life UK	73	281	325
OMG Life US	(35)	-	222
Life Group	38	281	547
Continuing operations	11,316	11,842	25,631
House of Moves	38	1,156	2,245
2d3 UK	379	420	631
2d3 USA	1,611	917	4,934
2d3 Group	1,990	1,337	5,565
Discontinued operations	2,028	2,493	7,810
OMG Group	13,344	14,335	33,441

	Revenue
	Six months ended 31 March 2015 (unaudited)	Six months  ended 31 March 2014 restated (unaudited)	Year ended 30 September 2014 restated   (audited)
	£'000	£'000	£'000
By destination
UK	4,400	4,206	9,335
Europe	1,203	1,089	3,034
North America	2,921	2,968	6,582
Asia Pacific	2,499	3,333	5,847
Other	293	246	833
Continuing operations	11,316	11,842	25,631
UK	238	437	531
Europe	143	-	106
North America	1,647	1,551	6,663
Asia Pacific	-	505	510
Discontinued operations	2,028	2,493	7,810
OMG Group	13,344	14,335	33,441
By origin
UK	6,941	8,538	17,853
North America	4,375	3,304	7,778
Continuing operations	11,316	11,842	25,631
UK	379	420	631
North America	1,649	2,073	7,179
Discontinued operations	2,028	2,493	7,810
OMG Group	13,344	14,335	33,441

	Six months ended 31 March 2015 (unaudited)	Six months  ended 31 March 2014 (unaudited)	Year ended 30 September 2014   (audited)
	£'000	£'000	£'000
Vicon revenue by market
Engineering	2,075	1,400	3,177
Entertainment	1,939	1,988	4,329
Life sciences	3,641	4,839	9,676
Vicon Group	7,655	8,227	*17,182

*This additional information is provided to the Chief Operating Decision Maker.  Further analysis by market is not available.

	Six months ended 31 March 2015 (unaudited)				Six months ended 31 March 2014 restated (unaudited)				Year ended 30 September 2014 restated (audited)
	Adjusted profit/(loss) before tax	Adjusting items	Group recharges	Profit/(loss) before tax	Adjusted profit/(loss) before tax	Adjusting items	Group recharges	Profit/(loss) before tax	Adjusted profit/(loss) before tax	Adjusting items	Group recharges	Profit/(loss) before tax
	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Vicon UK	973	(30)	313	1,256	1,315	(17)	144	1,442	2,373	(8)	1,359	3,724
Vicon USA	816	-	(672)	144	979	-	(849)	130	2,607	-	(2,054)	553
Vicon Group	1,789	(30)	(359)	1,400	2,294	(17)	(705)	1,572	4,980	(8)	(695)	4,277
Yotta UK	(247)	(60)	(155)	(462)	(360)	(80)	(222)	(662)	56	(114)	(306)	(364)
Yotta Mayrise	744	(212)	(150)	382	652	(212)	-	440	1,487	(424)	(301)	762
Yotta Group	497	(272)	(305)	(80)	292	(292)	(222)	(222)	1,543	(538)	(607)	398
OMG Life UK	(1,702)	(491)	(352)	(2,545)	(2,061)	(19)	(79)	(2,159)	(4,208)	14	(402)	(4,596)
OMG Life US	(30)	(137)	-	(167)	-	-	-	-	(138)	-	-	(138)
Life Group	(1,732)	(628)	(352)	(2,712)	(2,061)	(19)	(79)	(2,159)	(4,346)	14	(402)	(4,734)
Unallocated	(1,217)	(88)	1,344	39	(1,089)	(106)	1,178	(17)	(2,170)	(159)	2,333	4
Continuing operations	(663)	(1,018)	328	(1,353)	(564)	(434)	172	(826)	7	(691)	629	(55)
House of Moves	(93)	-	-	(93)	(265)	-	-	(265)	(373)	(616)	-	(989)
2d3 UK	60	(7)	(198)	(145)	223	(10)	(97)	116	241	(11)	(376)	(146)
2d3 USA	(1,005)	(127)	(130)	(1,262)	(908)	(123)	(75)	(1,106)	1,092	(233)	(253)	606
2d3 Group	(945)	(134)	(328)	(1,407)	(685)	(133)	(172)	(990)	1,333	(244)	(629)	460
Discontinued operations	(1,038)	(134)	(328)	(1,500)	(950)	(133)	(172)	(1,255)	960	(860)	(629)	(529)
OMG Group	(1,701)	(1,152)	-	(2,853)	(1,514)	(567)	-	(2,081)	967	(1,551)	-	(584)

	Non-current assets			Additions to non-current assets			Carrying amount of segment assets			Carrying amount of segment liabilities			Segment depreciation and amortisation
	Six months ended 31 March 2015 (unaudited)	Six months  ended 31 March 2014 (unaudited)	Year ended 30 September 2014   (audited)	Six months ended 31 March 2015 (unaudited)	Six months  ended 31 March 2014 (unaudited)	Year ended 30 September 2014   (audited)	Six months ended 31 March 2015 (unaudited)	Six months  ended 31 March 2014 (unaudited)	Year ended 30 September 2014   (audited)	Six months ended 31 March 2015 (unaudited)	Six months  ended 31 March 2014 (unaudited)	Year ended 30 September 2014   (audited)	Six months ended 31 March 2015 (unaudited)	Six months  ended 31 March 2014 (unaudited)	Year ended 30 September 2014   (audited)
	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Vicon UK	2,960	2,657	2,748	743	750	1,552	12,179	7,422	8,459	(2,409)	(2,094)	(2,346)	440	426	863
Vicon USA	1,190	1,182	701	8	29	43	4,211	3,843	4,321	(1,032)	(1,233)	(1,561)	13	27	45
Vicon Group	4,150	3,839	3,449	751	779	1,595	16,390	11,265	12,780	(3,441)	(3,327)	(3,907)	453	453	908
Yotta UK	4,489	4,851	4,477	245	210	407	11,172	8,757	10,497	(1,892)	(1,887)	(1,702)	319	294	594
Yotta Mayrise	4,361	4,817	4,586	6	21	23	9,834	10,000	9,371	(1,603)	(1,667)	(1,833)	226	229	458
Yotta Group	8,850	9,668	9,063	251	231	430	21,006	18,757	19,868	(3,495)	(3,554)	(3,535)	545	523	1,052
OMG Life UK	1,308	1,916	1,633	543	403	862	(3,915)	(152)	(2,470)	(467)	(1,104)	(777)	461	568	1,137
OMG Life USA	-	-	-	-	-	-	209	-	380	(1)	-	(2)	-	-	-
Life Group	1,308	1,916	1,633	543	403	862	(3,706)	(152)	(2,090)	(468)	(1,104)	(779)	461	568	1,137
Unallocated	504	262	303	24	16	17	(684)	128	(400)	(414)	(292)	(622)	11	9	20
Continuing operations	14,812	15,685	14,448	1,569	1,429	2,904	33,006	29,998	30,158	(7,818)	(8,277)	(8,843)	1,470	1,553	3,117
Yotta USA	-	-	-	-	-	-	28	25	26	(5)	(4)	(5)	-	-	-
House of Moves	-	845	-	-	19	26	-	1,449	720	-	(244)	(45)	-	15	27
2d3 UK	-	12	11	-	-	2	297	2,131	2,353	(126)	(74)	(48)	3	2	4
2d3 USA	-	4,519	4,297	-	71	313	5,231	5,991	8,665	(1,508)	(1,238)	(2,163)	244	187	390
2d3 Group	-	4,531	4,308	-	71	315	5,528	8,122	11,018	(1,634)	(1,312)	(2,211)	247	189	394
Discontinued operations	-	5,376	4,308	-	90	341	5,556	9,596	11,764	(1,639)	(1,560)	(2,261)	247	204	421
OMG Group	14,812	21,061	18,756	1,569	1,519	3,245	38,562	39,594	41,922	(9,457)	(9,837)	(11,104)	1,717	1,757	3,538

3.  Reconciliation of adjusted (loss)/profit before tax

	Six months ended 31 March  2015	Six months ended 31 March  2014 Restated	Year  ended 30 September 2014 Restated
	(unaudited)	(unaudited)	(audited)
	£'000	£'000	£'000
Loss before tax - continuing operations	(1,353)	(826)	(55)
Share based payments - equity settled	112	176	166
Amortisation of intangibles arising on acquisition	258	258	516
Costs associated with termination of contract manufacturer	540	-	-
Redundancy costs	108	-	9
Reapportion Group overheads	(328)	(172)	(629)
Adjusted (loss)/profit before tax - continuing operations	(663)	(564)	7
Profit before tax - discontinued operations	(1,500)	(1,255)	(529)
Share based payments - equity settled	15	22	24
Amortisation of intangibles arising on acquisition	119	111	220
Impairment of goodwill	-	-	616
Reapportion Group overheads	328	172	629
Adjusted (loss)/profit before tax - discontinued operations	(1,038)	(950)	960
Total adjusted (loss)/profit before tax - all operations	(1,701)	(1,514)	967

Redundancy costs in the six months ended 31 March 2015 relate to the restructuring of the Vicon, Yotta and OMG Life businesses (year ended 30 September 2014 costs relate to the restructuring of the 2d3 UK business).

Costs associated with termination of contract manufacturer relate to agreements to manufacture the Autographer in volume that were not fulfilled together with settlement of supply chain commitments. The cash impact in the previous financial year except for £106,000 which impacted the first half of this financial year.

4.  Taxation

The Group's consolidated effective tax rate for the six months ended 31 March 2015 was 31.1% (for the six months ended 31 March 2014: 28.7%; for the year ended 30 September 2014: 2.4%).

In accordance with IAS 34 the tax charge for the half year is calculated on the basis of the estimated full year tax rate.

5.  Loss per share

The calculation of the basic earnings per share is based on the earnings attributable to ordinary shareholders divided by the weighted average number of shares in issue during the period. The calculation of diluted earnings per share is based on the basic earnings per share, adjusted to allow for the issue of shares on the assumed conversion of all dilutive options.

	31 March 2015 (unaudited)			31 March 2014 restated (unaudited)			30 September 2014 restated (audited)
	Earnings/(loss)	Weighted average number of shares	Per share amount	Earnings/(loss)	Weighted average number of shares	Per share amount	Earnings/(loss)	Weighted average number of shares	Per share amount
	£'000		(pence)	£'000		(pence)	£'000		(pence)
Continuing operations
Basic loss per share
Earnings attributable to ordinary shareholders	(578)	113,357,814	(0.51)	(677)	109,288,622	(0.62)	(104)	111,334,397	(0.09)
Dilutive effect of employee share options	-	-	-	-	-	-	-	-	-
Diluted loss per share	(578)	113,357,814	(0.51)	(677)	109,288,622	(0.62)	(104)	111,334,397	(0.09)
Discontinued operations
Basic loss per share
Earnings attributable to ordinary shareholders	(1,389)	113,357,814	(1.22)	(806)	109,288,622	(0.74)	(466)	111,334,397	(0.42)
Dilutive effect of employee share options	-	-	-	-	-	-	-	-	-
Diluted loss per share	(1,389)	113,357,814	(1.22)	(806)	109,288,622	(0.74)	(466)	111,334,397	(0.42)
Total operations
Basic loss per share
Loss attributable to ordinary shareholders	(1,967)	113,357,814	(1.73)	(1,483)	109,288,622	(1.36)	(570)	111,334,397	(0.51)
Dilutive effect of employee share options	-	-	-	-	-	-	-	-	-
Diluted loss per share	(1,967)	113,357,814	(1.73)	(1,483)	109,288,622	(1.36)	(570)	111,334,397	(0.51)

6.  Share capital

	31 March	31 March	30 September
	2015	2014	2014
	(unaudited)	(unaudited)	(audited)
	£'000	£'000	£'000
Allotted, called up and fully paid
113,357,814 shares of 0.25p (31 March 2014: 113,357,814 shares of 0.25p and 30 September 2014: 113,357,814 shares of 0.25p)	283	283	283

During the six month period ended 31 March 2014 9,356,691 shares were issued in relation to the contingent consideration payable for the acquisition of Sensing Systems Inc.

There were no shares issued for cash in respect of share options exercised (six month period ended 31 March 2014: no shares).

7.  Dividends

The following dividends were recognised as distributions to equity holders in the period:

	31 March	31 March	30 September
	2015	2014	2014
	(unaudited)	(unaudited)	(audited)
	£'000	£'000	£'000
Final dividend for 2014 paid in 2015 - 0.50 pence per share	567	429	429

The final dividend for 2014 was paid to shareholders on 11 March 2015 at 0.50 pence per share, a total of £567,000.

8.  Copies of the interim statement

Copies of the interim statement will be sent to shareholders.  Further copies will be available from the Company's registered office at 14 Minns Business Park, West Way, Oxford OX2 0JB, and from the Company's website: www.omgplc.com

 

END

 

 

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