Final Results

RNS Number : 5275W

Avisen PLC

30 July 2009

 



30 July 2009

Avisen plc

("Avisen" or the "Company")

Final results for the 11 month period ended 31 January 2009

The board of directors ("Board") of Avisen, the AIM quoted performance management specialist, is pleased to announce the Company's final results for the 11 month period ended 31 January 2009.

Highlights

• Net profit increased to £505,229 (2008: Net loss of £4,910,515)

• EPS of 2.1p (2008: Loss per Share 20.7p)

• Avisen Group Limited acquired by the AIM quoted cash shell Z GROUP plc on 2nd February 2009 in a reverse take-over transaction

Post Balance Sheet Highlights

• Three acquisitions completed; Wexner Global Limited, Eon Enterprises Limited and Quadrum Consulting (Propriety) Limited  

• Fourth acquisition, Inca Holdings Limited, announced 17 July 2009 - completion imminent 

Marcus Hanke, CEO of Avisen, commented:

"Avisen's management team has grown the business rapidly in a relatively short period of time, both organically and through the pursuit of a targeted "buy-and-build" strategy. We are confident that we can continue to deliver growth and are excited by the prospect of becoming a leading player in the business intelligence and performance management market."

For further information, please contact:

Avisen plc
Marcus Hanke (CEO)	Tel: [phone]
Louis Peacock (Executive Director and Acting CFO)	Tel: [phone]
NOMAD and Broker:
John East & Partners Limited, a subsidiary of Merchant Securities Plc	Tel: [phone]
Bidhi Bhoma
Financial PR:
Bishopsgate Communications	Tel: [phone]
Robyn Samuelson/Siobhra Murphy
[e-mail]

CHAIRMAN'S STATEMENT 

I am pleased to present the results of the Company for the 11 month period ended 31 January 2009 (the Company's accounting reference date having been changed from 28 February to 31 January to reflect the acquisition of Avisen Group Limited ("Avisen Group"), described below).

RESULTS

The profit on ordinary activities after taxation for the period amounted to £505,229 (2008 - loss £4,910,515) representing earnings per share of 2.1 pence (2008 - loss per share 20.7 pence).

BACKGROUND INFORMATION ON THE COMPANY

Z GROUP plc was incorporated on 20 April 2005 and admitted to trading on AIM on 21 June 2005. At that time, the Company operated in the software and computer services sector. Following the disposal of its trading subsidiaries on 7 January 2008, the Company no longer had a trading business and accordingly the Company became an investing company pursuant to Rule 15 of the AIM Rules. In January 2008, the directors at that time stated that the Company intended to implement an investing strategy, in accordance with the AIM Rules, and seek a suitable investment opportunity for the Company, being a target in the technology, media or sciences sectors. Any potential acquisition would also need to satisfy the main criteria of having an experienced management team, a sizeable projected market for the target's products and/or services and the promising potential growth of that market.

KEY ACQUISITION 

Having reviewed a large number of potential acquisition candidates, the business and future prospects of Avisen Group, a business and technology consultancy specialising in performance management, was seen to represent a significant opportunity for shareholders.  

On 7 January 2009, the Company entered into a conditional acquisition agreement to acquire the entire issued share capital of Avisen Group, with the consideration to be satisfied by the issue of 86,666,667 new ordinary shares. The acquisition was conditional on the passing of certain resolutions proposed at a general meeting held on 30 January 2009 with re-admission to the AIM market becoming effective on 2 February 2009. Further information on Avisen Group and the rationale behind the acquisition is set out in the Company's AIM Admission Document which is available from the Company's website, www.avisenplc.com. 

At the general meeting held on 30 January 2009, all resolutions were duly passed, which, subject only to the shares of the enlarged group being readmitted to trading on AIM, resulted in the Company completing the acquisition of Avisen Group and the Company's name being changed to Avisen plc.

EVENTS AFTER 31 JANUARY 2009, INCLUDING BOARD CHANGES AND ACQUISITIONS

The Company was readmitted to trading on AIM on 2 February 2009.

Upon completion of the acquisition, Marcus Hanke, Andrew Turner, Louis Peacock and Keith Jones were appointed to the Board and Ian Smith resigned from the Board. Jon Claydon remained as Non-Executive Chairman, Marcus Yeoman remained as a Non-Executive Director and Marcus Hanke was appointed as Chief Executive Officer. Duncan Neale resigned as Finance Director on 30 June 2009, at which point Louis Peacock was appointed as Interim Finance Director. 

During the period since the end of the financial year the Company has completed three acquisitions; Wexner Global Limited ("Wexner"), Eon Enterprises Limited ("Eon") and Quadrum Consulting (Propriety) Limited ("Quadrum"). A fourth acquisition, Inca Holdings Limited, was announced on 17 July 2009 and is expected to be completed shortly.

Wexner has a successful history of working with blue chip clients to develop and implement their strategy. It works with them, with the aim of improving their profitability through increased productivity and cost reduction, transforming both their finance and their operational functions. The purchase of Wexner's assets, including its industry know-how and contacts, not only provides Avisen with access to Wexner's client base, but augments the Company's ability to provide high-end consulting and advisory services.

Eon's sole wholly owned subsidiary, Infocube Limited ("Infocube") is a leading IBM Cognos Business Partner. Infocube, founded in 1988, provides practical and cost-effective business intelligence, planning, forecasting and data warehousing solutions for its clients. Infocube works in partnership with Cognos, an IBM company, which is the world's leading developer of Enterprise Business Intelligence and Performance Management software, in order to provide a comprehensive range of services, including software licences, consultancy, development, training and post implementation support.

Quadrum, founded in 2006, is a South African business which provides business intelligence, planning, forecasting and activity based costing and financial consolidation solutions for its clients. Quadrum works in partnership with IBM Cognos in order to provide a comprehensive range of services, including software licenses, consultancy, development, training and post implementation support. Avisen is now positioned as a leading IBM Cognos reseller and consultancy both in the UK and in South Africa. The Company will have access to both Quadrum's blue-chip client base and its pool of skilled resources, which are intended to augment Avisen's offshore services capability.

The Board is delighted with the acquisitions and the process of integrating the businesses is either completed or well underway. These acquisitions are in line with the Company's stated strategy and the Board believes that they, in addition to Inca Holdings Limited, will make a significant contribution to the revenues of the Company and will improve its competitive position.

PROSPECTS

Avisen's management team have grown the business rapidly in a relatively short period of time, both organically and through the pursuit of a targeted "buy-and-build" strategy. We are confident that we can continue to deliver growth and are excited by the prospect of becoming a leading player in the business intelligence and performance management market.

JON CLAYDON

Non-executive Chairman

30 July 2009

CONSOLIDATED INCOME STATEMENT FOR THE 11 MONTH PERIOD ENDED 31 JANUARY 2009

	Notes	11 months ended 31 January 2009 £	Year ended 29 February 2008 £
Revenue		8,750	-
Cost of sales		(5,000)	-
Share based payments credit		636,972	383,667
Other administrative expenses		(269,725)	(860,830)
Proceeds on disposal of investments		-	60,000
Write down of investments		-	(4,638,803)
OPERATING PROFIT / (LOSS)	2	370,997	(5,055,966)
Finance income	3	64,232	53,404
Other income	3	70,000	91,231
PROFIT / (LOSS) BEFORE INCOME TAX		505,229	(4,911,331)
Income tax credit	4	-	816
PROFIT / (LOSS) FOR THE PERIOD		505,229	(4,910,515)
EARNINGS / (LOSS) PER SHARE (pence)
Basic	5	2.13	(20.68)
Diluted	5	2.11	(20.68)

AUDITED CONSOLIDATED BALANCE SHEET AS AT 31 JANUARY 2009

	Notes	31 January 2009 £	29 February 2008 £
ASSETS
Investments	6	-	-
Property, plant and equipment		1,501	10,898
Other receivables		117,500	117,500
Non-current assets		119,001	128,398
Trade and other receivables		377,959	374,552
Cash and cash equivalents	7	1,165,131	1,203,824
Current assets		1,543,090	1,578,376
Total assets		1,662,091	1,706,774
EQUITY AND LIABILITIES
Capital and reserves attributable to equity holders of the Company
Share capital		1,187,294	1,187,294
Share premium account		5,967,758	5,967,758
Share option reserve		63,410	700,382
Retained losses		(5,793,965)	(6,299,194)
Total equity		1,424,497	1,556,240
Trade and other payables		237,594	150,534
Current liabilities		237,594	150,534
Total liabilities		237,594	150,534
Total equity and liabilities		1,662,091	1,706,774

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE 11 MONTH PERIOD ENDED 31 JANUARY 2009

	Share capital	Share premium	Share based payments	Retained earnings	Total
	£	£	£	£	£
Balance at 1 March 2008	1,187,294	5,967,758	700,382	(6,299,194)	1,559,240
Share option credit in the year			(636,972)		(636,972)
Profit for the period				505,229	505,229
Total recognised income and expense for the period	-	-	(636,972)	505,229	(131,743)
Balance at 31 January 2009	1,187,294	5,967,758	63,410	(5,793,965)	1,424,497

CONSOLIDATED CASH FLOW STATEMENT FOR THE 11 MONTH PERIOD ENDED 31 JANUARY 2009

	11 months ended 31 January 2009 £	Year ended 29 February 2008 £
Cash flows from operating activities
Operating profit / (loss)	370,997	(5,055,966)
Depreciation	3,599	32,711
Amortisation	-	510
Share option credit	(636,972)	(383,667)
Write down of investments sold in the year	-	16,991,305
(Increase) / Decrease in trade and other receivables	(3,406)	2,388,261
Increase / (Decrease) in trade and other payables	87,060	(14,417,368)
Write down of web development costs and domain names	-	1,807
Write down of property, plant and equipment	5,798	-
Cash used in operations	(172,924)	(442,407)
Income tax credit	-	816
Net cash (used in) operating activities	(172,924)	(441,591)
Cash flows from investing activities
Purchase of property, plant and equipment	-	(5,340)
Proceeds from the sale of property, plant and equipment	-	99,649
Repayment of overdraft	705	-
Interest received	64,232	53,404
Other income	70,000	91,231
Net cash from / (used in) investing activities	134,937	238,944
Net (decrease) in cash and cash equivalents	(37,987)	(202,647)
Cash and cash equivalents at the beginning of the period	1,203,118	1,405,765
Cash and cash equivalents at the end of the period	1,165,131	1,203,118

NOTES TO THE PRELIMINARY RESULTS FOR THE 11 MONTH PERIOD ENDED 31 JANUARY 2009

1.    BASIS OF PREPARATION

These financial statements have been prepared in accordance with International Financial Reporting Standards, International Accounting Standards and Interpretations (collectively IFRS) issued by the International Accounting Standards Board (IASB) as adopted by European Union ("adopted IFRSs"), and are in accordance with IFRS as issued by the IASB.

The financial information set out above does not constitute the Company's statutory accounts for the year ended 29 February 2008 and the 11 month period to 31 January 2009, but is derived from those accounts. Statutory accounts for the year ended 29 February 2008 have been delivered to the Registrar of Companies and those for the 11 month period ended 31 January 2009 will be delivered following the Company's Annual General Meeting. The Auditors have reported on those accounts; their reports were unqualified and did not contain statements under the Companies Act 1985, sections 237(2) or (3).

2.    OPERATING PROFIT / (LOSS)

	11 months ended 31 January 2009 £	Year ended 29 February 2008 £
The Company's operating profit (2008: loss) is shown after charging / (crediting):
Significant items:
Write down on sale of fixed asset investments	-	4,638,803
Share based payments (credit) / charge	(636,972)	(383,667)
Depreciation	3,599	32,711
Amortisation	-	510
Fees payable to the Company's auditor for the audit of the Company's annual accounts	5,000	12,000
Other services related to taxation	11,000	14,600

3.    FINANCE & OTHER INCOME

	11 months ended 31 January 2009 £	Year ended 29 February 2008 £
Bank interest receivable	64,232	53,404
Dividend income	70,000	-
Rent income	-	91,231
Finance and other income	134,232	144,635

4.    INCOME TAX CREDIT

	11 months ended 31 January 2009 £	Year ended 29 February 2008 £
Factors affecting tax charge for period:
Profit / (Loss) on ordinary activities before tax	505,229	(4,911,331)
Profit / (Loss) on ordinary activities multiplied by standard rate of corporation tax in the UK of 30% (2008: 30%)	151,569	(1,473,399)
Effects of:
Expenses not deductible for tax purposes	7,249	133,326
Temporary differences in the recognition of profits or losses not recognised for tax purposes	-	15,507
Losses not recognised for tax purposes	(158,818)	1,439,666
Adjustment in respect of previous period's income tax	-	(816)
Share based payments not recognised for tax purposes	-	(115,100)
Tax credit for the period	-	(816)

5.    EARNINGS / (LOSS) PER SHARE

	31 January 2009 No.	29 February 2008 No.
Weighted average number of shares:
For basic earnings per share	23,745,885	23,745,885
Dilutive effect of share options	200,775	-
For diluted earnings per share	23,946,660	23,745,885
Profit / (Loss) for the period	£505,229	£(4,910,515)
Earnings / (Loss) per share:
	pence	pence
- Basic  - Diluted	2.13 2.11	(20.68) (20.68)

6.    INVESTMENTS

Cost and net book value:	£
At 1 March 2008	16,991,305
Book value of investments sold in the year	(16,991,305)
At 31 January 2009	-

7.    CASH AND CASH EQUIVALENTS

	31 January	31 January	29 February	29 February
	2009	2009	2008	2008
	£	Fixed interest rate thereon	£	Fixed interest rate thereon
Current account	26,006	0.00%	43,614	0.00%
Deposit accounts	1,139,125	5.65%	1,160,210	5.65%
	1,165,131		1,203,824

8.    RELATED PARTY TRANSACTIONS

The only key management personnel of the Company are the Directors. Details of the compensation of the key management personnel, as required by IAS 24 "Related Party Disclosures", are disclosed in note 6 of the report and accounts of the Company for the 11 month period to 31 January 2009.

Jack Bekhor and Jamie True purchased the trading subsidiaries of the Company on 7 January 2009 (the "MBO"). Jack Bekhor and Jamie True remain related parties of the Company in their capacity as significant shareholders of the Company. A summary follows of the movements in the debt due to and from these related parties up to 31 January 2009:

	11 months ended 31 January 2009 £	Year ended 28 February 2008 £
Opening debt due from / (to) related parties	328,534	590,447
Cash forwarded by the Company to the related parties	-	4,512,109
Cash forwarded by the related parties to the Company	(234,059)	(4,757,361)
Other re-charges from the related parties	-	332,552
Other re-charges from the Company	-	(20,205)
Loan waiver to ex-subsidiary	-	(329,008)
Closing debt due from related parties	94,475	328,534

The closing debt of £94,475 has been paid to the Company after the period end. 

9.    POST BALANCE SHEET EVENTS

On 2 February 2009 Avisen Plc (formerly Z Group plc) acquired Avisen Group Limited.

10.    DIVIDENDS

The directors are unable to recommend the payment of a dividend.  

11.    COPIES OF THE REPORT & ACCOUNTS

Copies of the Report and Accounts have been posted to shareholders, are available from the Company's registered office 16 Devonshire Street, London W1G 7AF and are available from the Company's website www.avisenplc.com.

 

END

 

 

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