Interim Results

RNS Number : 3097I

Vianet Group PLC

08 December 2015

 

Press Release

8 December 2015

Vianet Group plc

("Vianet" or "the Group")

Interim Results

Vianet Group plc (AIM:VNET), the leading provider of real time monitoring systems and data management services for the leisure, vending and forecourt services sectors, is pleased to announce its interim results for the six months ended 30 September 2015.

Financial summary

●	Revenue up 7.7% to £9.84 million (H1 2015: £9.14 million)
●	Operating profit before amortisation, share based payments and exceptional items up 15.1% to £1.75 million (H1 2015: £1.52 million)
●	Basic earnings per share (pre-exceptional items) up 18.2% at 3.51p (H1 2015: 2.97p), held back by a deferred tax adjustment of 1.26p
●	Interim dividend maintained at 1.70p (H1 2015: 1.70p)
●	Vending Solutions operating profit of £0.25 million (H1 2015: £0.28 million) was held back by the cost of new appointments
●	Vianet Americas operating loss reduced to £0.15 million (H1 2015: £0.17 million)
●	Fuel Solutions operating profit of £0.22 million (H1 2015: £0.004 million)

Operational highlights

●	139 new iDraughtTM installations (H1 2015: 261 installations)
●	Vending division growth continues with 2,410 new unit sales (H1 2015: 3,926 units) predominantly in coffee vending
●	Several 5 year contract renewal and extensions including Punch Taverns, Trust Inns, and Heineken's Star Pubs and Bars
●	5 year contract with JDE (formally Douwe Egberts BV)
●	Highest level of Payment Card Industry compliance (PCI-DSS level 1) was achieved September 2015 for Cashless solution deployment

 

Post period end highlight

●	Agreement to sell Fuel Solutions to Wayne Fueling Systems ("Wayne"), for a consideration of £3.5m

Commenting on the interim results, James Dickson, Chairman of Vianet Group plc, said: "I am pleased that our interim results demonstrate the resilience of our core Leisure division with the benefits of new i-draught orders and cost savings offsetting the impact of pub closures. Looking forward, we have achieved some important contract extensions and new wins with key customers in both Leisure and Vending, where coffee telemetry and contactless payment solutions continue to drive growth. The sale of our Fuel Solutions division announced today will release both cash and management energy to develop our growth strategies in both Leisure and Vending still further"

- Ends -

An audio cast of the interim results presentation given by Stewart Darling, Chief Executive, Mark Foster, Chief Financial Officer, and James Dickson, Chairman, was released this morning at 07.00hrs on Tuesday, 8 December 2015 on the Group's website www.vianetplc.com  with the link also being distributed by Abchurch Communications.

Enquiries:

Vianet Group plc
James Dickson, Chairman	Tel: [phone]
[e-mail]	www.vianetplc.com

Cenkos Securities plc
Stephen Keys / Camilla Hume	Tel: [phone]
	www.cenkos.com

Media enquiries:

Abchurch Communications
Quincy Allan / James Burman [e-mail]	Tel: [phone] www.abchurch-group.com

 

Chairman's Statement

I am pleased to report that the Group's focus on growth areas has resulted in increased profits for the six months to 30 September 2015 compared with the same period last year.

The resilience of Vianet's recurring revenue streams, particularly within the Leisure and Vending divisions, was supported by several Pub Co contract renewals and new orders for iDraught^TM as well as the continued roll out of vending telemetry.  The Fuel Solutions division demonstrated good revenue and profit growth, in part reflecting the hard work restructuring the business over the last two years to ensure it reaches its full potential. 

New iDraught^TM orders, together with ongoing cost reductions and efficiencies, largely offset the impact of pub closures, with H1 operating profit in the Leisure division being just 1.8% lower year on year at just over £2 million.  In Vianet Americas, the streamlined iDraught^TM operation, helped by 22 new installations, reduced its year on year losses.

Good progress has been achieved in the Vending division with continued deployment of new telemetry units for the coffee market.  Of particular note was our Cashless Payment solution achieving the highest level of Payment Card Industry compliance (PCI-DSS level 1) in September 2015 ahead of its launch in H2. Excluding the carrying the cost of new appointments, including the new role of Managing Director, the Vending division like for like profit was up c15%. 

The Group's Fuel Solutions division achieved a significant increase in revenue and operating profit in the period and a there is a good pipeline of activity for H2.

Results

Growth in turnover for the period to £9.84 million (H1 2015: £9.14 million) was assisted by an increase in Fuel Division revenues with stable revenue contributions from iDraught^TM and Vending.

Group gross margin of 57.0% is slightly lower compared to 59.5% in H1 2015 due primarily to the revenue mix being impacted by increased sales of relatively lower margin tank lining in the Fuel Solutions division.

Group profit before amortisation, share based payments and exceptional items grew to £1.75 million (H1 2015: £1.52 million) and Group profit before taxation was up 50.6% to £1.16 million (H1 2015: £0.77 million), reflecting a sharp drop in exceptional costs.

Group EPS before exceptional costs and deferred tax adjustment amounted to 4.77 pence (H1 2015: 4.01 pence), with a deferred tax adjustment of £0.34m reducing EPS before exceptional costs and post deferred tax adjustment to 3.51 pence (H1 2015: 2.97 pence).

As reported at the last full year results, a deferred tax asset provision was made to reflect the losses, as acquired with the original Vianet vending operations, and available to the Group, for offset against future profit generation.  The deferred tax asset will be released proportionally against profits and the tax charge shown in the results represents the relevant proportion of that unwinding.

Dividend

Reflecting its continued confidence in the Group's medium term prospects and the strength of its cash flow, the Board is pleased to maintain the interim dividend at 1.70 pence per share (H1 2015: 1.70 pence per share), payable on 2 February 2016 to shareholders on the register as at 18 December 2015.  A final dividend of 4.00 pence per share was paid in respect of the year ended 31 March 2015 on 24 July 2015.

Vianet Fuel Solutions ("VFS") Transaction

On 7^th December the Group executed a formal legal agreement to sell VFS to Wayne Fueling Systems, for a consideration of £3.5m with completion expected in the coming weeks.

Over the past two years VFS has made significant commercial progress and has established a strong reputation in the UK forecourt sector, and the transaction recognises the value which has been created.

Whilst it will be sad to say farewell to the VFS team, I am pleased that there is a great fit with Wayne who will take VFS to the next stage of development and growth.  This is a competitive landscape increasingly dominated by major global players such as Wayne.

The sale of VFS enables Vianet to give even greater focus to developing our chosen strategies in Leisure and Vending - helping our customers make better decisions through providing game-changing strategic insight and actionable data which delivers a compelling return on investment.

Board

In preparing for the efficient operation of the Group following the sale of VFS, we have, amongst other things, considered the optimum composition of the Board.  Having recently been appointed as Chairman of Booker, and with other commitments including being senior NED at Mitchells & Butler, Stewart Gilliland believes that this is an appropriate time to inform the Board that he will retire from the Board on 31 December 2015.   On a personal note, whilst delighted for Stewart and wishing him well, I will be sad to lose a trusted advisor who has been with Vianet since early 2006.

At the same time, now that I no longer have executive responsibility for VFS, it has been agreed that I should complete the transition from Executive to Non-Executive Chairman with effect from 1 January 2016.

Whilst I am confident that the Board will function well under the new structure, we are evaluating its composition to ensure that it contains the optimum balance of experience and independence to support our day to day operations and also our growth strategies.

Outlook

The Board is confident that further new sales in iDraught^TM and vending solutions will deliver continued growth, despite the fact that Vianet may continue to be influenced by the challenges faced by the UK pub sector. 

Whilst M&A activity in the pub sector may also have a short term dampening effect on new iDraught^TM volumes, the rate of pub closures is diminishing and the outlook for the core Leisure division is improving as significant contract extensions with key customers and the benefit of cost initiatives come through.

Elsewhere, vending telemetry continues to progress well, particularly in the coffee vending market, and the launch of contactless payment solutions is expected to gather further momentum in the second half of the year.  Throughout the Group, cash flow is strong, underpinned by high levels of recurring revenue.

The Board remains confident that Vianet's long term strategy is appropriate and that the Group is capable of delivering consistent and sustained growth within the parameters of its influence and control.

James W Dickson                                                                

Chairman                                                                    

8 December 2015
 

Chief Executive and Chief Financial Officer Review

Whilst the decline in numbers of operational sites in the pub sector has continued, this fall has been at a reduced rate to that encountered in previous years.  In addition, it is encouraging that the relevancy of our core monitoring product has been reinforced by significant contract extensions with key customers.  The Group's continued cost efficiency measures and focus on driving sales of newer products such as iDraught^TM and vending telemetry has also been beneficial in maintaining overall performance.  These factors combined with the step-up in performance of the Fuel Solutions division, has resulted in the underlying trading outcome for the six months to 30 September 2015 showing some good progress as set against the same point last year.

As anticipated, a lower level of exceptional costs are reported in the period, amounting to £0.14m (H1 2014: £0.32m).  These related principally to staff transition costs and also to US litigation costs.  As can sometimes result from transacting business in the US, the Group is currently defending itself in court against certain claims asserted by third parties.  Following legal advice, the Board considers these claims to be without merit.  Whilst this process will result in further legal costs during the year these are not expected to material. 

Cash generated from operations was up £0.53m to £1.52m (H1 2015: £0.99m).

Against this background, the Group had an overall net debt of £2.32 million at 30 September 2015 (H1 2015: £2.86 million).  The Group continues to be cash generative which provides a strong financial base.

Leisure Division

The underlying performance of the Group's core beer monitoring business remained solid over the period with new iDraught^TM sales offset by the impact of further pub closures. Contract extensions were secured with several large customers including Punch Taverns, Trust Inns, and Star Pubs and Bars.  A new agreement with New River Retail has also been secured. Higher margin iDraught^TM now accounts for approximately 22% (H1 2015: 18%) of the Group's beer monitoring base by number of installations and that percentage is expected to continue to increase.

Over the period, the division made 179 new beer monitoring installations (H1 2015: 268 new installations) of which 139 (H1 2015: 261) were iDraught^TM installations.  The reduction in pace illustrates the impact of the Statutory Code MRO provisions but the Board expects continued new sales in to H2 and beyond.

The industry has continued to experience pub closures and disposals which have resulted in a net reduction of just over 400 sites to approximately 15,700 sites in the core Leisure installation base.  This is, however, a marked slowdown in the pace of reduction from the experience of the previous financial year.

Vianet remains confident for the future growth prospects for iDraught^TM in the UK, both in new installations for new customers and replacement systems for existing beer monitoring customers. 

In the USA, the ongoing roll out of iDraught^TM saw the installation base reach 187 sites at the period end.  Whilst encouraged by continued strong interest from national retail chains, the Board remains conscious that further traction is required to achieve an improved financial

performance.

Vending Solutions

The Group's vending telemetry business continues to trade profitably with pre-exceptional profit of £0.25 million (H1 2015: £0.28 million).  Year on year, the like for like result shows small growth when factoring in the cost of the addition of Matt Lane as Managing Director in May 2015.  The division has been held back slightly by corporate activity in a major new prospect and the slightly delayed launch of the enhanced payment solution.  Despite turnover remaining broadly flat at £1.01m in the period, (H1 2015: £1.10m) the outlook for vending is positive and underpinned by a number of pilots in major international customers for the Group's leading end-to-end vending telemetry solution.  The Group achieved level 1 PCI-DSS compliance in September 2015, an essential component to ensuring customer payment data is secure by industry standards.  This development will support the acceleration of cashless solution deployment, further underpinning the Board's belief that this area of the business will continue to grow.

Fuel Solutions

Fuel Solutions reported a much improved profit of £0.22m before exceptional costs in the period (H1 2015: £0.004 million).  The division has benefitted from good growth in sales, particularly in tank lining, construction projects and wet stock as well as continued cost rationalisation.  The Fuel Solutions division has continued to develop its revenue streams which is set to continue in H2, allowing for the usual adverse seasonal impact of Christmas.

Given the UK pub sector challenges the Group has continued to face, the overall result and contribution from each main trading element of Leisure, Vending and Fuel Solutions has been pleasing.  This provides a solid platform to continue the growth of the Group, recognising that there is still much to do to achieve the potential of the products and services offered underpinned by an appropriate cost base.

Stewart Darling Chief Executive	Mark Foster Chief Financial Officer
8 December 2015

Consolidated Statement of Comprehensive Income

For the six months ended 30 September 2015

		Before Exceptional 6 months	Exceptional 6 months	Total Unaudited 6 months	Unaudited 6 months	Audited Year
		Ended	Ended	Ended	Ended	Ended
		30 Sept	30 Sept	30 Sept	30 Sept	31 March
		2015	2015	2015	2014	2015
	Note	£'000	£'000	£'000	£'000	£'000
Revenue	3	9,844	-	9,844	9,138	18,530
Cost of sales		(4,233)	-	(4,233)	(3,700)	(7,520)
Gross profit		5,611	-	5,611	5,438	11,010
Administration and other operating expenses	4	(3,857)	(138)	(3,995)	(4,240)	(8,434)
Profit before amortisation and share based payments	3	1,754	(138)	1,616	1,198	2,576
Intangible asset amortisation		(407)	-	(407)	(382)	(757)
Share based payments		(29)	-	(29)	(20)	(45)
Operating profit		1,318	(138)	1,180	796	1,774
Finance costs		(25)	-	(25)	(30)	(65)
Profit before tax		1,293	(138)	1,155	766	1,709
Income tax expense	5	(340)	-	(340)	(280)	(419)
Profit and total comprehensive income for the period attributable to the owners of the parent	3	953	(138)	815	486	1,290
Earnings per share	6
Basic		3.51p	(0.51)p	3.00p	1.80p	4,78p
Diluted		3.50p	(0.51)p	2.99p	1.80p	4.77p

 

Consolidated Balance Sheet

At 30 September 2015

		Unaudited As at 30 Sept 2015	Unaudited As at 30 Sept  2014	Audited As at 31 March 2015
		£'000	£'000	£'000
Assets
Non-current assets
Intangible assets		20,149	20,038	20,159
Property, plant and equipment		3,561	3,677	3,537
Total non-current assets		23,710	23,715	23,696
Current assets
Inventories		1,801	1,785	1,897
Trade and other receivables		4,376	4,038	4,187
Tax asset		684	1,177	1,024
Cash and cash equivalents		216	395	548
		7,077	7,395	7,656
Total assets		30,787	31,110	31,352
Equity and liabilities
Liabilities
Current liabilities
Trade and other payables		3,627	3,470	3,947
Borrowings		1,184	1,412	1,043
		4,811	4,882	4,990
Non-current liabilities
Borrowings		1,350	1,836	1,594
Deferred tax		-	14	-
		1,350	1,850	1,594
Equity attributable to owners of the parent
Share capital		2,831	2,827	2,831
Share premium account		11,198	11,182	11,198
Shares based payment reserve		236	198	209
Own shares		(1,221)	(1,381)	(1,381)
Merger reserve		310	310	310
Retained profit		11,272	11,242	11,601
Total equity		24,626	24,378	24,768
Total equity and liabilities		30,787	31,110	31,352

 

Summarised Consolidated Cash Flow Statement

For the six months ended 30 September 2015

		Unaudited 6 months	Unaudited 6 months	Audited Year
		Ended	Ended	Ended
		30 Sept	30 Sept	31 March
		2015	2014	2015
		£'000	£'000	£'000
Cash flows from operating activities
Profit for the period		815	486	1,290
Adjustments for
Interest payable		25	30	65
Income tax expense		340	280	419
Amortisation of intangible assets		407	382	757
Depreciation		267	257	492
Payment of deferred consideration		(22)	(20)	(20)
Loss on sale of property, plant and equipment		2	7	14
Share-based payments		29	20	45
Operating profit before changes in working capital and provisions		1,863	1,442	3,062
Change in inventories		97	66	(46)
Change in receivables		(187)	(203)	(352)
Change in payables		(257)	(311)	205
		(347)	(448)	(193)
Cash generated from operations		1,516	994	2,869
Income tax refunded		-	-	-
Net cash from operating activities		1,516	994	2,869
Cash flows from investing activities
Proceeds on disposal of property, plant and equipment		1	3	21
Purchases of property, plant and equipment		(293)	(243)	(363)
Purchase of intangible assets		(438)	(251)	(787)
Net cash used in investing activities		(730)	(491)	(1,129)
Cash flows from financing activities
Interest payable		(25)	(30)	(65)
Issue of share capital		-	-	20
Repayments of borrowings		(243)	(450)	(1,067)
Proceeds from disposal of own shares		101	-	-
New borrowings		-	1,000	1,000
Dividends paid		(1,087)	(1,080)	(1,539)
Net cash used in financing activities		(1,254)	(560)	(1,651)
Net (decrease)/increase in cash and cash equivalents		(468)	(57)	89
Cash and cash equivalents at beginning of period		(11)	(100)	(100)
Cash and cash equivalents at end of period		(479)	(157)	(11)

 

Statement of changes in equity

Six months ended 30 September 2014

	Share capital	Share premium account	Share based payment reserve	Own shares	Merger reserve	Retained profit	Total
	£000	£000	£000	£000	£000	£000	£000
At 1 April 2014	2,827	11,182	293	(1,381)	310	11,721	24,952
Dividends	-	-	-	-	-	(1,080)	(1,080)
Share based payment	-	-	20	-	-	-	20
Share option forfeitures	-	-	(115)	-	-	115	-
Transactions with owners	-	-	(95)	-	-	(965)	(1,060)
Profit and total comprehensive income for the period	-	-	-	-	-	486	486
Total comprehensive income less owners transactions	-	-	(95)	-	-	(479)	(574)
At 30 September 2014	2,827	11,182	198	(1,381)	310	11,242	24,378

12 months ended 31 March 2015

	Share capital	Share premium account	Share based payment reserve	Own shares	Merger reserve	Retained profit	Total
	£000	£000	£000	£000	£000	£000	£000
At 1 April 2014	2,827	11,182	293	(1,381)	310	11,721	24,952
Dividends	-	-	-	-	-	(1,539)	(1,539)
Issue of shares	4	16	-	-	-	-	20
Share based payment	-	-	45	-	-	-	45
Share option forfeitures	-	-	(129)	-	-	129	-
Transactions with owners	4	16	(84)	-	-	(1,410)	(1,474)
Profit and total comprehensive income for the year	-	-	-	-	-	1,290	1,290
Total comprehensive income less owners transactions	4	16	(84)	-	-	(120)	(184)
At 31 March 2015	2,831	11,198	209	(1,381)	310	11,601	24,768

Six months ended 30 September 2015

	Share capital	Share premium account	Share based payment reserve	Own shares	Merger reserve	Retained profit	Total
	£000	£000	£000	£000	£000	£000	£000
At 1 April 2015	2,831	11,198	209	(1,381)	310	11,601	24,768
Dividends	-	-	-	-	-	(1,087)	(1,087)
Exercised options	-	-	-	160	-	(59)	101
Share based payment	-	-	29	-	-	-	29
Share option forfeitures	-	-	(2)	-	-	2	-
Transactions with owners	-	-	27	160	-	(1,144)	957
Profit and total comprehensive income for the period	-	-	-	-	-	815	815
Total comprehensive income less owners transactions	-	-	27	160	-	(329)	(142)
At 30 September 2015	2,831	11,198	236	(1,221)	310	11,272	24,626

Notes to the interim report

1.         Statutory information

The interim financial statements are unaudited and do not constitute statutory accounts within the meaning of Section 435 of the Companies Act 2006. The auditor's review report on the interim financial information for the six months ended 30 September 2015 is set out on page 13.

The financial information for the year ended 31 March 2015 has been derived from the published statutory accounts. A copy of the full accounts for that period, on which the auditor issued an unqualified report that did not contain statements under 498(2) or (3) of the Companies Act 2006, has been delivered to the Registrar of Companies.

These interim financial statements will be posted to all shareholders and are available from the registered office at One Surtees Way, Surtees Business Park, Stockton on Tees, TS18 3HR or from our website at www.vianetplc.com/investors

2.         Accounting policies

These interim financial statements are for the six months ended 30 September 2015. As is permitted, the Group has chosen not to adopt IAS 34 'Interim Financial Statements' and therefore the interim financial information is not in full compliance with International Financial Reporting Standards but has been prepared using consistent accounting policies with those applied in the full year accounts to 31 March 2015, in accordance with the recognition and measurement principles of IFRS as adopted by the European Union, in accordance with the AIM rules, and under the historic cost convention.

3.         Segmental information

An operating segment is a component of an entity that engages in business activities from which it may earn revenues and incur expenses. The segment operating results are regularly reviewed by the Chief Operating Decision Maker to make decisions about resources to be allocated to the segment and assess its performance. Leisure is further analysed into three segments - Leisure Services, Vending and Technology highlighting the three key divisions within Leisure. Technology does not meet the quantitative thresholds required for segmental reporting but the directors believe that it is important to separately its results given the importance of its activity to the Group.

The products/services offered by each operating segment are:

Leisure Services: design, product development, sale and rental of fluid monitoring equipment, data management and related services

Vending: design product development, sale and rental of machine monitoring equipment, data management and related services.

Technology: provision of data management and technology related services

Fuel Solutions: wet stock analysis and related services.

The inter-segment sales are immaterial. Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated assets and liabilities comprise items such as cash and cash equivalents, certain intangible assets, taxation, and borrowings. Segment capital expenditure is the total cost incurred during the year to acquire segment assets that are expected to be used for more than one period.

 

The segmental results for the six months ended 30 September 2015 are as follows:

Continuing Operations	Leisure Services	Vending	Technology	Fuel Solutions	Corporate	Total
	£'000	£'000	£'000	£'000	£'000	£'000
Total revenue	5,915	1,010	31	2,888	-	9,844
Profit/(loss) before amortisation, share based payments and exceptional costs	2,000	251	(60)	224	(661)	1,754
Pre-exceptional segment result	1,915	101	(145)	127	(680)	1,318
Exceptional costs	(100)	(5)	(15)	(15)	(3)	(138)
Post exceptional segment result	1,815	96	(160)	112	(683)	1,180
Finance costs	(14)	-	-	-	(11)	(25)
Profit/(loss) before taxation	1,801	96	(160)	112	(694)	1,155
Taxation						(340)
Profit for the year from continuing operations						815

	Leisure Services	Vending	Technology	Fuel Solutions	Corporate	Total
	£'000	£'000	£'000	£'000	£'000	£'000
Segment assets	25,325	-	-	4,565	214	30,104
Unallocated assets	-	-	-	-	683	683
Total assets	25,325	-	-	4,565	897	30,787
Segment liabilities	4,963	-	-	1,036	162	6,161
Unallocated liabilities	-	-	-	-	-	-
Total liabilities	4,963	-	-	1,036	162	6,161

The asset base of the leisure division cannot be split across Leisure Services, Vending and Technology, so has been allocated to Leisure Services.

Notes to the interim report (continued)

The segmental results for the six months ended 30 September 2014 are as follows:

Continuing Operations	Leisure Services	Vending	Technology	Fuel Solutions	Corporate	Total
	£'000	£'000	£'000	£'000	£'000	£'000
Total revenue	6,006	1,078	69	1,985	-	9,138
Profit/(loss) before amortisation, share based payments and exceptional costs	2,020	283	(142)	4	(650)	1,515
Pre-exceptional segment result	1,925	152	(210)	(85)	(669)	1,113
Exceptional costs	(219)	(12)	(5)	(37)	(44)	(317)
Post exceptional segment result	1,706	140	(215)	(122)	(713)	796
Finance income	-	-	-	-	-	-
Finance costs	(16)	-	-	-	(14)	(30)
Profit/(loss) before taxation	1,690	140	(215)	(122)	(727)	766
Taxation						(280)
Profit for the year from continuing operations						486

	Leisure Services	Vending	Technology	Fuel Solutions	Corporate	Total
	£'000	£'000	£'000	£'000	£'000	£'000
Segment assets	25,589	-	-	4,127	220	29,936
Unallocated assets	-	-	-	-	1,174	1,174
Total assets	25,589	-	-	4,127	1,394	31,110
Segment liabilities	5,768	-	-	801	163	6,732
Unallocated liabilities	-	-	-	-	-	-
Total liabilities	5,768	-	-	801	163	6,732

The asset base of the leisure division cannot be split across Leisure Services, Vending and Technology, so has been allocated to Leisure Services.

Notes to the interim report (continued)

The segmental results for the 12 months ended 31 March 2015 are as follows:

Continuing Operations	Leisure Services	Vending	Technology	Fuel Solutions	Corporate	Total
	£'000	£'000	£'000	£'000	£'000	£'000
Total revenue	12,146	2,105	107	4,172	-	18,530
Profit/(loss) before amortisation, share based payments and exceptional costs	4,264	353	(139)	(190)	(1,240)	3,048
Pre-exceptional segment result	3,957	293	(318)	(151)	(1,407)	2,374
Exceptional costs	(336)	(41)	(66)	(105)	(52)	(600)
Post exceptional segment result	3,621	252	(384)	(256)	(1,459)	1,774
Finance income	-	-	-	-	-	-
Finance costs	(36)	-	-	-	(29)	(65)
Profit/(loss) before taxation	3,585	252	(384)	(256)	(1,488)	1,709
Taxation						(419)
Profit for the year from continuing operations						1,290

	Leisure Services	Vending	Technology	Fuel Solutions	Corporate	Total
	£'000	£'000	£'000	£'000	£'000	£'000
Segment assets	25,686	-	-	4,421	220	30,327
Unallocated assets	-	-	-	-	1,025	1,025
Total assets	25,686	-	-	4,421	1,245	31,352
Segment liabilities	5,387	-	-	893	304	6,584
Unallocated liabilities	-	-	-	-	-	-
Total liabilities	5,387	-	-	893	304	6,584

The asset base of the leisure division cannot be split across Leisure Services, Vending and Technology, so has been allocated to Leisure Services.

 

Notes to the interim report (continued)

4.         Exceptional items

		6 months	6 months	Year
		Ended	Ended	Ended
		30 Sept	30 Sept	31 March
		2015	2014	2015
		£'000	£'000	£'000
Exceptional costs		138	317	600
		138	317	600

Exceptional costs principally relate to employee exit and US legal costs.

5.         Tax

The charge for tax is based on the profit for the period and comprises:

		6 months	6 months	Year
		Ended	Ended	Ended
		30 Sept	30 Sept	31 March
		2015	2014	2015
		£'000	£'000	£'000
United Kingdom corporation tax		340	280	419

Tax charge relates to a partial release of deferred tax provision made at 31 March 2014 in relation to the losses available to Vianet Limited.

6.         Earnings per share 

Earnings per share is calculated on the profit after tax of £0.815m (H1 2015: £0.486m) and the average number of shares in issue during the period of 27,127,136 (H1 2015: 26,993,684).

Diluted earnings per share are calculated by taking the earnings as disclosed above and the average number of shares that would be issued on the full exercise of outstanding share options of 27,224,668 (H1 2015: 27,031,419).

7.         Post Balance Sheet Event

On 7th December 2015 the Group announced that it has executed a formal agreement to sell its VFS division to Wayne Fueling Systems, for a consideration of £3.5m, with completion expected in the coming weeks.

 

INDEPENDENT REVIEW REPORT TO VIANET GROUP PLC

 

Introduction

We have been engaged by the company to review the financial information in the half-yearly financial report for the six months ended 30 September 2015 which comprises the consolidated statement of comprehensive income, the consolidated balance sheet, the summarised consolidated cash flow statement, the statement of changes in equity and the related explanatory notes. We have read the other information contained in the half yearly financial report which comprises only the Chairman's Statement, Chief Executive and Chief Financial Officer Review and considered whether they contain 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 guidance contained in ISRE (UK and Ireland) 2410, 'Review of Interim Financial Information performed by the Independent Auditor of the Entity'. Our review work has been undertaken so that we might state to the company those matters we are required to state to them in a 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 conclusion we have formed.

Directors' responsibilities

The half-yearly financial report is the responsibility of, and has been approved by, the directors. The AIM rules of the London Stock Exchange require that the accounting policies and presentation applied to the financial information in the half-yearly financial report are consistent with those which will be adopted in the annual accounts having regard to the accounting standards applicable for such accounts.

As disclosed in note 2, the annual financial statements of the group are prepared in accordance with IFRSs as adopted by the European Union. The financial information in the half-yearly financial report has been prepared in accordance with the basis of preparation in note 2.

Our responsibility

Our responsibility is to express to the company a conclusion on the financial information 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 enquiries, 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 financial information in the half-yearly financial report for the six months ended 30 September 2015 is not prepared, in all material respects, in accordance with the basis of accounting described in note 2.

GRANT THORNTON UK LLP
AUDITOR

LEEDS
8 December 2015

 

END

 

 

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