Final Results

Datacash Group PLC 11 April 2006 Tuesday 11th April 2006 DataCash Group Plc: DATA / Index: AIM / Sector: Support Services DATACASH GROUP PLC ('DataCash' or 'the Company') FINAL RESULTS DataCash Group Plc, the AIM listed payments service provider, announces its results for the 12 months to 31 December 2005. Overview â€¢ Adjusted pre-tax profit* up 66% to Â£2.53m (2004: Â£1.52m) - equivalent to an underlying EPS of 5.65p (2004: 3.40p) â€¢ Turnover up 32% to Â£6.12m (2004: Â£4.64m) â€¢ Cash balance of Â£4.90m (11p per share) (2004: Â£3.21m) â€¢ Continued strong growth of the core Card Holder Not Present transaction processing business - transaction volumes increased by more than 50% year-on-year to 63 million â€¢ Strong growth from retail and gaming customers â€¢ Ongoing investment in technology infrastructure and new product offerings â€¢ High profile contract wins in 2006 and a healthy pipeline of target customers â€¢ Increased dividend payment of 0.75p per share recommended (2004: 0.50p) which is payable on 16 June 2006 to shareholders on the register at 12 May 2006. â€¢ Board looks forward to the future with confidence. * before goodwill amortisation, National Insurance provision on share option gain and exceptional items. Contacts: Keith Butcher Finance Director, DataCash Group Plc 0870 7274760 Isabel Crossley St Brides Media & Finance Ltd 020 7242 4477 Chairman's Statement DataCash Group plc made further good progress in 2005, with pre-tax profits, before amortisation of goodwill, NI provision on share option gains and exceptionals ("Adjusted pre-tax profits") rising more than 60% to Â£2.53m (2004: Â£1.52m) and cash balances growing by Â£1.69m to Â£4.90m (2004: Â£3.21m). The Board is pleased to recommend a 50% increase in the dividend for the year to 0.75p (2004: 0.50p). Turnover grew by more than 30% from Â£4.64m to Â£6.12m in 2005, reflecting the continued growth of the core business of Card Holder Not Present transaction processing. Costs also increased (by 17%) as we invested in our core technology infrastructure and in our sales function. Adjusted pre-tax profits grew by Â£1m to Â£2.53m (2004: Â£1.52m) and underlying earnings per share were 5.65p (2004: 3.40p). We continue to benefit from accumulated tax losses. Transaction growth remained strong, rising by 22m to 63m (2004: 41m), with particular progress from our retail customers, reflecting the increasing willingness of UK consumers to buy on-line and the increased penetration of broadband. The gaming market, which provides in excess of 50% of all our transactions, continued to see good growth. Our strategy of using skills we have developed to support the gaming sector to broaden our wider market opportunity has been vindicated. We are confident of further significant growth in all our target markets in 2006. The strategy of offering a complete service to merchants, and not to restrict ourselves to the online world, has taken some considerable investment and, so far, has generated very little return. However, we are now seeing a growing acceptance of the benefits of our approach and are confident the opportunity we identified more than two years ago will make a contribution. Product and infrastructure development saw significant investment in 2005 and this will continue into 2006. The Group also sought to broaden its position both in terms of product and geographical penetration which included an aborted acquisition. Unfortunately, the due diligence process revealed issues that meant the deal could not be consummated upon the terms previously agreed. The cost of this is shown as an exceptional item of Â£402,000. Andrew Dark joined the Group in January 2006 as CEO, bringing considerable experience of payment systems. Andrew has already made a very positive contribution and we welcome him to the Group. I would like to thank all the employees of DataCash, especially Jane Reedy, who was a Board director until May 2005 and who will retire shortly, for their contribution during 2005, a year that saw good progress towards achieving our strategic goals. The Board looks forward with confidence and expectations of good revenue and profits growth in 2006. David Bailey Chairman Consolidated Profit & Loss Account For the year ended 31 December 2005 Restated Year ended 31 Dec Year ended 31 Dec 2005 2004 Â£'000 Â£'000 Note Turnover 6,116 4,643 Administrative expenses Amortisation of Goodwill (1,975) (1,975) National insurance on share option charge (34) (125) Severance payments (73) - Aborted acquisition costs (402) - Other operating expenses (3,754) (3,210) Total administrative expenses (6,238) (5,310) Operating loss (122) (667) Interest receivable and similar income 167 87 Profit/(Loss) on ordinary activities before taxation 45 (580) Taxation (687) 228 Loss on ordinary activities after taxation (642) (352) Basic and diluted loss per share 2 (1.43)p (0.79)p The group's loss for the year arises from the groups' continuing operations. All recognised gains and losses are included in the profit and loss account. Consolidated Balance Sheet As at 31 December 2005 Restated 31 Dec 2005 31 Dec 2004 Note Â£'000 Â£'000 Fixed assets Intangible assets 8,337 10,312 Tangible assets 161 190 Investments - - 8,498 10,502 Current assets Debtors 966 741 Debtors - deferred tax asset 522 1,175 Cash at bank and in hand 4,895 3,206 6,383 5,122 Creditors Amounts falling due within one year (1,225) (1,187) Net current assets 5,158 3,935 Total assets less current liabilities 13,656 14,437 Provisions for liabilities and charges (148) (125) 13,508 14,312 Capital and reserves Called up share capital 449 448 Share premium account 9,811 9,750 Merger reserve (124) (124) Other reserve 18,889 18,889 Profit and loss account (15,517) (14,651) Equity shareholders' funds 5 13,508 14,312 Consolidated Cash Flow Statement For the year ended 31 December 2005 Year ended 31 Dec Year ended 31 Dec 2005 2004 Â£'000 Â£'000 Note Net cash inflow from operating activities 3 1,775 1,678 Returns on investments and servicing of finance Interest received 167 87 Net cash inflow from returns on investments and servicing of finance 167 87 Taxation (17) - Capital expenditure and financial investment Purchase of tangible fixed assets (73) (158) Sale of tangible fixed assets - 1 Net cash outflow from capital expenditure and financial (73) (157) investments Equity dividends paid (224) - Net cash inflow before management of liquid resources and financing 1,628 1,608 Management of liquid resources (Increase)/Decrease in short term bank deposits (3,289) 112 Net cash (outflow)/inflow from management of liquid resources (3,289) 112 Financing Exercise of share options 61 50 Net cash inflow from financing 61 50 (Decrease)/Increase in cash in the year (1,600) 1,770 Reconciliation of Net Cash Flow to Movement in Net Funds For the year ended 31 December 2005 Year ended 31 Dec Year ended 31 Dec 2005 2004 Â£'000 Â£'000 (Decrease)/increase in cash in the year (1,600) 1,770 Cash inflow/(outflow) from management of liquid resources 3,289 (112) Movement in net funds 1,689 1,658 Opening net funds 3,206 1,548 Closing net funds 4,895 3,206 Notes to the Financial Statements For the year ended 31 December 2005 1. Basis of Preparation The results for the year ended 31 December 2005 have been prepared on accounting bases and policies which are consistent with those used in the preparation of the financial statements of the Group for the year ended 31 December 2004 with the exception of the prior year adjustment explained below. In the current year, the group has adopted FRS 21 - Post Balance Sheets Events - for the first time. As a result dividends can only be recognised once they have been passed at a General meeting of the members, in the case of final dividends, and the period in which they were paid in the case of Interim dividends. This has had the effect of increasing the brought forward profit and loss reserve by reversing the proposed dividend of Â£224,000 - 2004 accounts and reducing the creditor (proposed dividend) by the same amount. The above financial information does not constitute statutory accounts as defined by section 240 of the Companies Act 1985. It is an extract from the 2005 financial statements, which have not yet been filed with the Registrar of Companies. The Auditors' Report, dated 11 April 2006, on the financial statements for the year ended 31 December 2005, which received an unqualified opinion, does not contain a statement under section 237(2) or (3) of the Companies Act 1985. The comparative information is an extract from the statutory accounts for the financial year ended 31 December 2004. Those accounts, on which the Auditors issued an unqualified opinion, in accordance with section 235 of the Companies Act 1985, have been filed with the Registrar of Companies. 2. Loss per Share The basic and diluted loss per share is based on the loss on ordinary activities after tax of Â£642,000 (December 2004: loss Â£352,000). The weighted average number of ordinary shares outstanding during the period used in the calculation of basic loss per share was 44,816,905 (December 2004: 44,737,684). Due to the loss incurred in the year and the prior year, there is no dilutive effect from the issue of share options. An adjusted earnings per share figure is presented below. The directors believe that the adjusted earnings per share figure assists in the presentation of the group's underlying performance. Year ended 31 Dec Year ended 31 Dec 2005 2004 Â£'000 Â£'000 Loss on ordinary activities after taxation (642) (352) Amortisation of Goodwill 1,975 1,975 Provision for national insurance on share option gains 34 125 Severance payments 73 - Aborted acquisition costs 402 - Profit on ordinary activities before goodwill, NI on share option 1,842 1,748 gains and exceptionals No. of shares No. of shares Weighted average number of shares 44,816,905 44,737,684 Dilutive effect of options 979,005 1,380,649 45,795,910 46,118,333 Diluted Adjusted Earnings per share 4.02p 3.79p 3. Reconciliation of operating loss to operating cash flows Year ended 31 Dec Year ended 31 Dec 2005 2004 Â£'000 Â£'000 Operating loss (122) (667) Amortisation 1,975 1,975 Depreciation 102 94 Profit on disposal of fixed assets - (1) Increase in debtors (225) (88) Increase in creditors 22 262 Increase in provisions 23 103 Net cash inflow from operating activities 1,775 1,678 4 Analysis of Net Funds At 1 January Cash Flow At 31 December 2005 2005 Â£'000 Â£'000 Â£'000 Cash in hand and at bank 2,317 (1,600) 717 Short term bank deposits 889 3,289 4,178 Total 3,206 1,689 4,895 5. Reconciliation of movement in shareholders' funds Restated Year ended 31 Dec Year ended 31 Dec 2005 2004 Â£'000 Â£'000 Loss for the year (642) (576) Prior year adjustment - 224 As restated (642) (352) Dividend paid (224) - Issue of Ordinary Share Capital including premium 61 50 Net movement in shareholders' funds (805) (302) Opening shareholders' funds 14,313 14,615 Net cash inflow from operating activities 13,508 14,313 NOTE A copy of the full accounts will be sent to shareholders on the Register Of Members as at 11 April 2006 or can be obtained from the Secretary, DataCash Group plc, Descartes House, 8 Gate Street, London WC2A 3HP. ANNUAL GENERAL MEETING The Company's AGM will be held on 17th May 2006 at 12.00 noon at Descartes House, 8 Gate Street, London WC2A 3HP This information is provided by RNS The company news service from the London Stock Exchange

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