Interim Results

Pennant International Group PLC 9 August 2002 9th August 2002 Pennant International Group plc, The Aim listed specialist in computer based training systems and logistical support and data management software for the defence industry today announces its Interim Results for the six months ended 30 June 2002 'Actions taken by your Board in response to the events and business uncertainties of 2001 have contributed to progress in the first half of this year. Despite the first half loss, organisational changes have contributed to a material reduction in costs, more efficient use of resources without any reduction in capability and an improvement in performance. The Group has a significantly enhanced order book and an encouraging cash position.' Christopher Powell, Chairman Full Chairman's Statement and financial details follow: For further information, please contact: Joe Thompson, Pennant International Group Plc: Tel: 01452 714881 Ken Rees, Winningtons: Tel: 0117 317 9477 Mobile: 07802 466567 Mike Coe, Rowan Dartington: Tel: 0117 9330020 CHAIRMAN'S STATEMENT Actions taken by your Board in response to the events and business uncertainties of 2001 have contributed to progress in the first half of this year. Despite the first half loss, organisational changes have contributed to a material reduction in costs, more efficient use of resources without any reduction in capability and an improvement in performance. The Group has a significantly enhanced order book and an encouraging cash position. The financial improvement follows the Placing and Open Offer in March 2002, which raised £1,995,000 net of expenses, the sale of surplus property in Southampton, a reduction in working capital as work in progress continues to be converted to cash and by improved progress payments. Adversely affecting the first half results have been delays in contract awards arising from extended procurement cycles and further budget reviews against planned expenditure in the financial year commencing April 2002. Also, late provision of data, by customers, on secured contracts has resulted in revenues being deferred into the second half and 2003. RESULTS AND DIVIDEND The Group loss on ordinary activities before taxation for the six months ended 30 June 2002 was £894,000 (2001 £1,328,000). Net debt at 30 June 2002 was £2,791,000 including £430,000 new loan in connection with the purchase of the Southampton property in February 2002. Net debt at 31 December 2001 was £3,702,000. Your Board is not recommending an interim dividend nor is it planned to pay a final dividend for the current year. CURRENT TRADING AND PROSPECTS Against these difficult market conditions Group companies have been successful in securing new business with a doubling of the firm order book that has the potential to generate revenues of approximately £10,000,000. The majority of this new business has been secured in competitive tender and approximately 50% by value is with new customers. The order book increase includes contributions from all business areas. Pennant Training Systems Limited has received notification of an extension to the Ministry of Defence Post Design Services contract to March 2005, contracts from Westland Helicopters Limited for two training devices in support of a new buy of Lynx 300 helicopters, repeat sales of training system products to a Middle East client and workshare with Atlantis Systems International of Canada for the Canadian Government EH101 Cormorant cockpit procedures trainer. Pennant Information Services Limited has secured three significant new business enabling contracts, one with the Ministry of Defence, one with a defence contractor and the third in the telecommunications industry. In the software business Pennant Australasia Pty Limited has secured the first phase of the forecast programme for the Department of Defence, covering delivery and implementation of OmegaPS Analyzer. In North America, the Canadian business is performing ahead of forecast and the management of the USA business has been reorganised with the appointment of two new key executives. Contract award for the balance of the Australian software programme, for the supply of the OmegaPS and OmegaPS Publisher products, is now scheduled for the second half of this year with revenues continuing into 2003. Pennant Training Systems Limited is now engaged in substantive discussions with BAE Systems for a Computer Based Training and Virtual Aircraft Training System for the South African Air Force Hawk Lead-In Fighter Trainer programme that is expected to generate main revenues in the period 2003 to 2005. Notwithstanding that Group companies have been selected for these programmes the potential value of these contracts is not included in the current order book. CONCLUSION Disappointingly, losses will continue in the second half of 2002 albeit at a reduced level. However, based on the strengthening order book, the lower cost structure and improving cash position your Board looks forward to 2003 with increasing confidence. Pennant International Group plc Consolidated Profit and Loss Account Six months Six months Year ended ended ended 30 June 30 June 31 December 2002 2001 2001 Notes £'000 £'000 £'000 Turnover 4451 5285 10905 Operating Loss (after exceptional redundancy costs of £123k) -900 -1217 -2252 Profit on sale of property 3 110 0 0 Loss on ordinary activities before interest -790 -1217 -2252 Interest -104 -111 -246 Loss on ordinary activities before taxation -894 -1328 -2498 Taxation 4 0 75 81 Loss attributable to ordinary shareholders -894 -1253 -2417 Ordinary dividends 0 0 0 Amount transferred from reserves -894 -1253 -2417 Earnings per share 5 Basic -3.84p -15.59p -30.07p Diluted -3.82p -14.92p -29.19p Statement of Total Recognised Gains and Losses Loss for the period -894 -1253 -2417 Currency translation differences on foreign currency net investments -5 -7 -11 -899 -1260 -2428 Pennant International Group plc Summarised Consolidated Balance Sheet As at As at As at 30 June 30 June 31 December 2002 2001 2001 Notes £'000 £'000 £'000 Intangible assets 1529 1778 1651 Tangible assets 3022 2780 2589 Investments 6 6 6 4557 4564 4246 Work in progress and debtors 4498 5328 4606 Creditors falling due within one year -2530 -2776 -2507 1968 2552 2099 Net bank balance -449 -1216 -1678 Current instalments of borrowings -304 -1620 -1582 Net current assets/(liabilities) 1215 -284 -1161 Total assets less current liabilities 5772 4280 3085 Future instalments of borrowings -2038 -474 -442 Creditors falling due after one year 0 0 -5 3734 3806 2638 Provisions for liabilities and charges 0 0 0 3734 3806 2638 Called up share capital and share premium account 6 6609 4614 4614 Reserves -2875 -808 -1976 3734 3806 2638 Pennant International Group plc Consolidated cash flow Six months Six months Year ended ended ended 30 June 30 June 31 December 2002 2001 2001 £'000 £'000 £'000 Cash flow from operating activities -493 138 -82 Returns on investment and servicing of finance -104 -111 -246 Taxation 0 0 -1 Capital expenditure -487 -115 -152 Acquisitions 0 -219 -215 Equity dividends 0 -223 -225 Cash Outflow before Financing -1084 -530 -921 Financing Issue of ordinary share capital 1995 0 0 Other financing 318 -54 -125 Increase/(decrease) in net cash 1229 -584 -1046 Reconciliation of net cash flow to movement in net debt Increase/(decrease) in net cash 1229 -584 -1046 Cash to repurchase debt 322 104 174 New loans and hire purchase contracts -640 -50 -50 Debt acquired with subsidiary undertakings 0 0 0 Movement in net debt in period 911 -530 -922 Net debt at beginning of period -3702 -2780 -2780 Net debt at end of period -2791 -3310 -3702 Reconciliation of operating profit to cash flow from operating activities Operating loss -900 -1217 -2252 Exceptional item 110 0 0 Depreciation 164 230 461 Amortisation of intangible assets 122 117 240 (Profit)/loss on sale of fixed assets -110 -4 -5 Decrease/(Increase) in work in progress and debtors 108 1003 1729 Increase/(decrease) in creditors 18 15 -243 Other movements -5 -6 -12 -493 138 -82 Pennant International Group plc Notes: 1. This interim statement, which is neither audited nor reviewed, has been prepared on the basis of the accounting policies set out in the Group's 2001 annual report and financial statements except as stated in 2. below. The balance sheet at 31 December 2001 and the results for the year then ended have been abridged from the Group's annual report and financial statements which has been filed with the Registrar of Companies: the auditors' opinion on the financial statements was unqualified. 2. The accounting policy in respect of deferred tax has been changed to reflect the requirements of FRS19. Deferred tax is provided in full in respect of the taxation deferred by timing differences between the treatment of certain items for taxation and accounting purposes. The previous policy was to provide for deferred tax only to the extent that it was probable the liability would crystallise in the foreseeable future. The adoption of the standard has not required a prior year adjustment. If the new policy had been in place in the previous year no liability would have been recognised, as the conditions for recognition would not have been satisfied. 3. In February 2002 the Group purchased Freehold property in Southampton for £805000. The purchase was financed from cash and a bank loan of £640000. Certain parts of the property, that were surplus to requirements, were sold in March and June 2002 for £397000 realising a profit of £110000. Part of the proceeds was used to reduce the Bank loan by £210000. 4. There is no taxation charge as no taxation charge is expected for the full year. There are significant tax losses available. 5. The calculation of earnings per share is based on loss attributable to the shareholders and weighted average number of shares as set out below: Six months Six months Year ended ended Ended 30 June 30 June 31 December 2002 2001 2001 Loss attributable to shareholders £ 894000 £1253000 £2416581 Basic weighted average number of shares 23261746 8036000 8036000 Employee share options 166500 362000 244000 Diluted weighted average number of shares 23428246 8398000 8280000 6. On 6 March 2002, the company's capital structure was reorganised by subdividing each Ordinary share of 20p into one New Ordinary Share of 5p and one New Deferred Share of 15p. In order to avoid the company having 2 classes of Deferred Shares, every 15 existing Deferred Shares were subdivided into 100 New Deferred Shares. On the same date the authorised share capital was increased to £4000000 divided into 51092000 New Ordinary Shares of 5p each and 9636000 New Deferred Shares of 15p each. Following this capital reorganisation the company raised £1995000 (net of expenses) through a Placing and Open Offer of New Ordinary Shares of 5p each at 9p. This announcement is being circulated to all shareholders of the Company and copies will be available to the public at the Company's Registered Office at Pennant Court, Staverton Technology Park, Cheltenham GL51 6TL This information is provided by RNS The company news service from the London Stock Exchange

Companies

Pennant International Group (PEN)
UK 100
FTSE quotes by TradingView

Latest directors dealings

All directors dealings today