Information  X 
Enter a valid email address

Netcall PLC (NET)

  Print          Annual reports

Wednesday 24 February, 2021

Netcall PLC

Half-year Report

RNS Number : 1058Q
Netcall PLC
24 February 2021
 

24 February 2021

 

NETCALL PLC

("Netcall", the "Company", or the "Group")

 

Interim results for the six months ended 31 December 2020

Continued sales momentum and positive outlook

Netcall plc (AIM: NET), the leading provider of intelligent automation and customer engagement software, today announces its unaudited interim results for the six months ended 31 December 2020.

 

· Revenue up 9% to £13.4m (H1-FY20: £12.3m)

· Cloud services annual contract value(1) ('ACV') at 31 December 2020 up 25% to £8.4m (H1-FY20: £6.7m)

 

· Total ACV at 31 December 2020 up 7% to £17.7m (H1-FY20: £16.6m)

· Adjusted EBITDA(2) up 39% to £2.95m (H1-FY20: £2.12m) 

· Profit before tax increased to £0.96m (H1-FY20: £0.14m)

 

· Adjusted basic earnings per share up 88% to 0.90p (H1-FY20: 0.48p)

· Cash generated from operations up 52% to £2.39m (H1-FY20: £1.57m)

 

· Group cash at 31 December 2020 was £12.9m more than offsetting borrowings of £6.8m

 

· Continued strong trading

 

· Significant cloud services growth from both Intelligent Automation and Customer Engagement offerings with an increasing number of customers using both solutions

 

· Strong revenue growth achieved in key market segments of financial services, healthcare and government, contributing to more than 85% of total revenues

 

· Annual revenue run-rate from Intelligent Automation now exceeds £10m, representing more than 40% of Group revenue and generating a positive contribution

 

· Recurring revenue from cloud and support contracts is 65% of revenue (H1-FY20: 64%)

 

· Released several new enhancements to the Liberty platform, including the addition of a Robotic Process Automation (RPA) solution

 

Outlook

· Strong current trading and healthy sales pipeline

 

· Whilst mindful of the ongoing impact of the pandemic, the Board now believes that adjusted EBITDA for the full year will be ahead of its previous expectations

Henrik Bang, Chief Executive, said:

Whilst the Board are mindful of the ongoing impact of the pandemic, the combination of strong current trading, improved forward revenue visibility and a healthy sales pipeline, means the Board now believes that adjusted EBITDA for the full year will be ahead of its previous expectations .

ooking further ahead, the Board remains confident that the strength of the Group's product offering, combined with its solid balance sheet and high levels of recurring revenue, position Netcall well for continued success. "  

 

(1) ACV, as at a given date, is the total of the value of each cloud and support contract divided by the total number of years of the contract.

 

(2) Profit before interest, tax, depreciation and amortisation adjusted to exclude the effects of acquisition, impairment, contingent consideration, share-based payments and non-recurring transaction costs.

 

Enquiries:

 

Netcall plc

Tel. +44 (0) 330 333 6100

 

 

 

Canaccord Genuity Limited (Nominated Adviser and Broker) 

Tel. +44 (0) 20 7523 8000

 

 

 

Alma PR

Tel. +44 (0) 20 3405 0205

 

 


Netcall's Liberty software platform with Intelligent Automation and Customer Engagement solutions helps organisations transform their businesses faster and more efficiently, empowering them to create a leaner, more customer-centric organisation. 

 

 

 

 

Overview

 

28% growth in cloud revenues underpinned by a 25% increase in cloud ACV to £8.4m (H1-FY20: £6.7m) from both Intelligent Automation and Customer Engagement solutions.

A growing number of customers are choosing to use both our Intelligent Automation and Customer Engagement offerings, combining them into more powerful and integrated solutions. Today more than 20% of Group ACV of £17.7m is from customers who have purchased both solutions, which gives a significant opportunity to grow within the existing customer base.

both Intelligent Automation and Customer Engagement grew at double-digit rates and cloud services is now approaching the same level as maintenance revenues and is expected to become the largest revenue stream in the coming months. The Board considers this a significant milestone, demonstrating the impact of the Group's cloud strategy.

 

Covid-19

 

The Board is especially grateful to the Netcall team who have continued to respond positively to the uncertainty caused by the pandemic, showing tremendous flexibility, resilience and creativity during this challenging period.

Given the changing nature of work, and with the entire team still working from home, Netcall took the decision to permanently close two offices, whilst retaining two offices and moving the Group's registered office to Bedford. 

As a result of the solid trading performance, the Group has not been required to introduce pay-cuts, furlough staff or make redundancies, although increased cash management measures, including the deferral of VAT in March and June 2020, have been implemented and the Company retained its strong focus on operational efficiency.

 

Current Trading and Outlook

The Group traded comfortably in line with the Board's expectations for the first half of the year. Trading to date in the second half of the year has continued at the same revenue growth rate as the first half. In addition, forward revenue visibility continues to improve, and we have entered the second half of the year with a healthy sales pipeline.

Whilst the Board are mindful of the ongoing impact of Covid-19, the combination of strong current trading, improved forward revenue visibility and a healthy sales pipeline, means the Board now believes that adjusted EBITDA for the full year will be ahead of its previous expectations.

looking further ahead, the Board remains confident that the strength of the Group's product offering, combined with its solid balance sheet and high levels of recurring revenue, position Netcall well for continued success.

a comprehensive and easy-to-use digital transformation toolkit including four main solution areas:

Intelligent Automation:

· Liberty Create: A low-code software solution which enables the creation of apps that drive workflows and business processes with integration to our communication services as well as back-end systems.

· Liberty RPA: An AI-powered robotic process automation solution, acquired through Automagica, which frees-up people from mundane and cumbersome tasks, enabling them to be more productive.

Customer engagement:

· Liberty Converse: A complete omnichannel contact centre solution for customer engagement which also includes solutions such as automated speech bots, workforce and quality management, switchboard and auto attendant.

· Liberty Connect: A cloud messaging and bot platform enabling customers to extend their reach using digital channels like web chat, Facebook Messenger and Twitter as well as benefit from bots and automation.

 

Strategy

of Group revenue in the six months to 31 December 2020.

empower them to create leaner and more customer-centric businesses.

· expansion of our customer base;

 

· growth through a land and expand model;

 

· continued innovation and enhancement of our platform; and

 

· growing our partner base.

Expansion of customer base

· A leading UK provider of home warranty and insurance who used the Low-code platform to develop a mobile app in order to improve the efficiency of site visits and enable virtual inspections.

 

· We continued to win new customers via our Citizen Hub and Patient Hub offerings, which use both our Low-code and customer engagement solutions. In total more than 30 customers have purchased these cloud-based solutions. Specifically, for the housing sector, a number of customers purchased a version of Citizen Hub adapted to their requirements.

 

· A global media company purchased our Low-code platform to develop a series of internal applications to improve business operations including a solution for advertising management. 

Growth through land and expand

Examples of new solutions purchased by existing customers include:

 

· An existing public sector customer using our Low-code platform decided to expand the usage of the Liberty platform by adopting our Customer Engagement solutions, as well as expanding the use of the Low-code platform by implementing Citizen Hub.

 

· A number of public sector customers already using our Customer Engagement solutions broadened their usage of the Liberty platform by purchasing our Low-code platform and Citizen Hub.

 

· A global insurance company expanded their licensed users during the period as they continue to roll-out their Low-code solution.

 

Continued innovation

, broadened our Intelligent Automation offering and expanded our market opportunity. Since the acquisition, the RPA solution has been integrated into the Liberty platform, with the first version of Liberty RPA released in early February 2021. The new release helps organisations to increase automation by exposing AI-functionality, including natural language processing, and computer vision for handwriting recognition capabilities.  Additionally, the new version includes a new Liberty RPA Studio, an easy drag-and-drop environment, for both business users and development professionals, used to create RPA flows.

Growing partner base

Wins via partners in the period included:

· Customer Engagement solutions to two large UK-based financial service organisations.

 

· A cloud contact centre solution to a central government organisation.

 

· Expansion of the Low-code solution to a customer within the insurance sector.

 

 

 

£'m ACV

H1-FY21

H1-FY20

H1-FY19

Cloud services

8.4

6.7

5.5

Product support contracts

9.3

9.9

9.6

Total

17.7

16.6

15.1

 

£'m Revenue

H1-FY21

H1-FY20

H1-FY19

Cloud services

4.1

3.2

3.0

Product support contracts

4.6

4.7

4.6

Total Cloud services & Product support contracts

8.7

7.9

7.6

Communication services

1.6

1.1

0.9

Product

1.0

1.2

1.0

Professional services

2.1

2.1

1.8

Total Revenue

13.4

12.3

11.4

 

 

 

£'000

 

Unaudited

Six months to

31 December 2020

Unaudited

Six months to

 31 December 2019

Audited

12 months to

 30 June 2020

Revenue

 

13,351

12,267

25,114

Cost of sales

 

(1,472)

(1,510)

(2,930)

Gross profit

 

11,879

10,757

22,184

 

 

 

 

 

Administrative expenses

 

(10,434)

(10,218)

(20,926)

Other losses - net

 

(98)

(35)

(24)

 

 

 

 

 

Adjusted EBITDA

 

2,949

2,115

4,413

Depreciation

 

(305)

(332)

(657)

Net loss on disposal of property, plant and equipment

 

(52)

(1)

-

Amortisation of acquired intangible assets

 

(227)

(248)

(483)

Amortisation of other intangible assets

 

(655)

(633)

(1,344)

Change in fair value of contingent consideration

 

-

(37)

(37)

Post-completion services

 

(59)

(33)

(33)

Share-based payments

 

(304)

(327)

(625)

 

 

 

 

 

Operating profit

 

1,347

504

1,234

 

 

 

 

 

Finance income

 

1

23

38

Finance costs

 

(385)

(391)

(775)

Finance costs - net

 

(384)

(368)

(737)

 

 

 

 

 

Profit before tax

 

963

136

497

 

 

 

 

 

Tax credit/ (charge)

 

350

(99)

(10)

Profit for the period

 

1,313

37

487

 

 

 

 

 

Earnings per share - pence

 

 

 

 

Basic

 

0.91

0.03

0.34

Diluted

 

0.87

0.02

0.33

 

All activities of the Group in the current and prior periods are classed as continuing. All of the profit for the period is attributable to the shareholders of Netcall plc.

 

Unaudited statement of comprehensive income for the six months to 31 December 2020

 

£'000

 

Unaudited

Six months to

31 December 2020

Unaudited

Six months to

31 December 2019

Audited

12 months to

 30 June 2020

 

 

 

 

 

Profit for the period

 

1,313

37

487

 

 

 

 

 

Other comprehensive income

 

 

 

 

Items that may be reclassified to profit or loss

 

 

 

 

Exchange differences arising on translation of foreign operations

 

34

11

(14)

Items that will not be reclassified to profit or loss

 

 

 

 

Changes in the fair value of equity investments at fair value through other comprehensive income

 

-

-

-

Total other comprehensive income for the year

 

34

11

(14)

 

 

 

 

 

Total comprehensive income for the period

 

1,347

48

473

 

All of the comprehensive income for the period is attributable to the shareholders of Netcall plc.

 

Unaudited consolidated balance sheet at 31 December 2020

 

£'000

 

Unaudited

31 December 2020

Unaudited

31 December 2019

Audited

30 June 2020

Assets

 

 

 

 

Non-current assets

 

 

 

 

Property, plant and equipment

 

739

1,071

960

Right-of-use assets

 

797

690

970

Intangible assets

 

30,208

29,054

29,078

Deferred tax asset

 

833

421

482

Financial assets at fair value through other comprehensive income

 

72

72

72

Total non-current assets

 

32,649

31,308

31,562

Current assets

 

 

 

 

Inventories

 

119

63

139

Other current assets

 

1,287

1,232

1,392

Contract assets

 

944

1,232

585

Trade receivables

 

3,159

3,311

3,957

Other financial assets at amortised cost

 

15

145

4

Cash and cash equivalents

 

12,903

6,502

12,710

Total current assets

 

18,427

12,485

18,787

Total assets

 

51,076

43,793

50,349

Liabilities

 

 

 

 

Non-current liabilities

 

 

 

 

Contract liabilities

 

42

171

104

Borrowings

 

6,802

6,689

6,745

Lease liabilities

 

759

635

902

Deferred tax liabilities

 

814

869

842

Total non-current liabilities

 

8,417

8,364

8,593

Current liabilities

 

 

 

 

Trade and other payables

 

7,553

3,527

6,907

Dividend payable

 

369

287

-

Contract liabilities

 

10,268

9,316

11,724

Current tax liabilities

 

2

-

-

Lease liabilities

 

194

198

248

Total current liabilities

 

18,386

13,328

18,879

Total liabilities

 

26,803

21,692

27,472

Net assets

 

24,273

22,101

22,877

 

 

 

 

 

Equity attributable to the owners of the parent

 

 

 

 

Share capital

 

7,483

7,275

7,312

Share premium

 

3,015

3,015

3,015

Other equity

 

4,900

4,900

4,900

Other reserves

 

3,381

3,900

3,996

Retained earnings

 

5,494

3,011

3,654

Total equity

 

24,273

22,101

22,877

 

 

Unaudited consolidated statement of changes in equity at 31 December 2020

 

£'000

Share capital

Share premium

Other equity

Other reserves

Retained earnings

Total equity

Balance at 30 June 2019

7,259

3,015

4,832

4,440

2,402

21,948

Issue of ordinary shares as consideration for acquisition in a business combination

14

-

68

-

-

82

Proceeds from share issue

2

-

-

-

-

2

Increase in equity reserve in relation to options issued

-

-

-

307

-

307

Reclassification following exercise or lapse of share options

-

-

-

(859)

859

-

Tax credit relating to share options

-

-

-

1

-

1

Dividends declared

-

-

-

-

(287)

(287)

Transactions with owners

16

-

68

(551)

572

105

Profit for the period

-

-

-

-

37

37

Other comprehensive income for the period

-

-

-

11

-

11

Profit and total comprehensive income for the period

-

-

-

11

37

48

Balance at 31 December 2019

7,275

3,015

4,900

3,900

3,011

22,101

Proceeds from share issue

37

-

-

-

-

37

Increase in equity reserve in relation to options issued

-

-

-

315

-

315

Reclassification following exercise or lapse of share options

-

-

-

(193)

193

-

Tax debit relating to share options

-

-

-

(1)

-

(1)

Transactions with owners

37

-

-

121

193

351

Profit for the period

-

-

-

-

450

450

Other comprehensive income for the period

-

-

-

(25)

-

(25)

Profit and total comprehensive income for the period

-

-

-

(25)

450

425

Balance at 30 June 2020

7,312

3,015

4,900

3,996

3,654

22,877

Proceeds from share issue

171

-

-

-

-

171

Increase in equity reserve in relation to options issued

-

-

-

218

-

218

Reclassification following exercise or lapse of share options

-

-

-

(896)

896

-

Tax credit relating to share options

-

-

-

29

-

29

Dividends declared

-

-

-

-

(369)

(369)

Transactions with owners

171

-

-

(649)

527

49

Profit for the period

-

-

-

-

1,313

1,313

Other comprehensive income for the period

-

-

-

34

-

34

Profit and total comprehensive income for the period

-

-

-

34

1,313

1,347

Balance at 31 December 2020

7,483

3,015

4,900

3,381

5,494

24,273

 

 

Unaudited consolidated cash flow statement for the six months to 31 December 2020

 

£'000

Unaudited

Six months to

31 December 2020

Unaudited

Six months to

 31 December 2019

Audited

12 months to

 30 June 2020

Cash flows from operating activities

 

 

 

Profit before income tax

963

137

497

Adjustments for:

 

 

 

  Depreciation and amortisation

1,187

1,213

2,484

  Loss on disposal of property, plant and equipment

52

1

-

  Share-based payments

304

327

625

  Net finance costs

384

368

737

  Other non-cash expenses

11

-

1

Changes in operating assets and liabilities, net of effects from acquisition of subsidiaries:

 

 

 

  Decrease in inventories

20

102

26

  Decrease/ (increase) in trade receivables

818

550

(92)

  (Increase)/ decrease in contract assets

(362)

(81)

589

  (Increase)/ decrease in other financial assets at amortised cost

(10)

(16)

100

  Decrease/ (increase) in other current assets

97

59

(107)

  Increase/ (decrease) in trade and other payables

472

(20)

3,334

  (Decrease)/ increase in contract liabilities

(1,548)

(1,066)

1,223

  Increase/ (decrease) in provisions

-

-

(29)

Cash generated from operations

2,388

1,574

9,388

Interest received

2

23

38

Interest paid

(3)

(2)

(6)

Net cash inflow from operating activities

2,387

1,595

9,420

 

 

 

 

Cash flows from investing activities

 

 

 

Payment for acquisition of subsidiary, net of cash acquired

(984)

(1,679)

(1,679)

Payment for property, plant and equipment

(15)

(64)

(146)

Payment of software development costs

(802)

(737)

(1,708)

Payment for other intangible assets

(7)

(9)

(9)

Proceeds from sale of property, plant and equipment

1

-

-

Net cash outflow from investing activities

(1,807)

(2,489)

(3,542)

 

 

 

 

Cash flows from financing activities

 

 

 

Proceeds from issue of ordinary shares

170

3

39

Interest paid on Loan Notes

(420)

(298)

(478)

Principal element of lease payments

(172)

(86)

(199)

Dividends paid to Company's shareholders

-

-

(287)

Net cash outflow from financing activities

(422)

(381)

(925)

 

 

 

 

Net increase/ (decrease) in cash and cash equivalents

158

(1,275)

4,953

Cash and cash equivalents at beginning of period

12,710

7,769

7,769

Effects of exchange rate changes on cash and cash equivalents

35

8

(12)

Cash and cash equivalents at end of period

12,903

6,502

12,710

 

 

Notes to the financial information for the six months ended 31 December 2020

 

1. General information

Netcall plc (AIM: "NET", "Netcall", "Group" or the "Company") is a leading provider of Low-code and customer engagement software. It is a public limited company which is quoted on AIM (a market of the London Stock Exchange). The Company's registered address is Suite 203, Bedford Heights, Brickhill Drive
Bedford, UK MK41 7PH and the Company's registered number is 01812912.

 

2. Basis of preparation

The Group interim results consolidate those of the Company and its subsidiaries (together referred to as the 'Group'). The principal trading subsidiaries of Netcall are Netcall Technology Limited and Netcall Systems Limited.

 

These condensed half year financial statements for the half year ended 31 December 2020 have been prepared in accordance with the AIM Rules for Companies, comply with IAS 34 Interim Financial Reporting as adopted by the European Union and should be read in conjunction with the annual financial statements for the year ended 30 June 2020, which have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union.

 

This results announcement is unaudited and does not constitute statutory accounts of the Group within the meaning of sections 434(3) and 435(3) of the Companies Act 2006 (the 'Act'). The balance sheet at 30 June 2020 has been derived from the full Group accounts published in the Annual Report and Accounts 2020, which has been delivered to the Registrar of Companies and on which the report of the independent auditors was unqualified and did not contain a statement under either section 498(2) or section 498(3) of the Act.

 

The results have been prepared in accordance with the accounting policies set out in the Group's 30 June 2020 statutory accounts.

 

The results for the six months ended 31 December 2020 were approved by the Board on 23 February 2021.  A copy of these interim results will be available on the Company's web site www.netcall.com from 23 February 2021.

 

The principal risks and uncertainties faced by the Group have not changed from those set out on page 11 of the annual report for the year ended 30 June 2020.  

 

3. Segmental analysis

The Board considers that there is one operating business segment being the design, development, sale and support of software products and services, which is consistent with the information reviewed by the Board when making strategic decisions. Resources are reviewed on the basis of the whole of the business performance.

 

The key segmental measure is adjusted EBITDA which is profit before interest, tax, depreciation, amortisation, acquisition and reorganisation expenses and share-based payments, a reconciliation of which is set out on the consolidated income statement.

 

4. Earnings per share

The basic earnings per share is calculated by dividing the net profit attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the year excluding those held in treasury:

 

 

Six months to

31 December 2020

Six months to

 31 December 2019

12 months to

 30 June 2020

Net earnings attributable to ordinary shareholders (£'000s)

1,313

37

487

Weighted average number of ordinary shares in issue (000s)

145,043

143,455

143,588

Basic earnings per share (pence)

0.91

0.03

0.34

 

The diluted earnings per share has been calculated by dividing the net profit attributable to ordinary shareholders by the weighted average number of shares in issue during the period, adjusted for potentially dilutive shares that are not anti-dilutive.

 

 

 

Six months to

31 December 2020

Six months to

 31 December 2019

12 months to

 30 June 2020

Weighted average number of ordinary shares in issue (000s)

145,043

143,455

143,588

Adjustments for share options (000s)

5,753

5,666

5,839

Weighted average number of potential ordinary shares in issue (000s)

150,796

149,121

149,427

Diluted earnings per share (pence)

0.87

0.02

0.33

 

Adjusted basic and diluted earnings per share have been calculated to exclude the effect of acquisition, contingent consideration and reorganisation costs, share-based payment charges, amortisation of acquired intangible assets and utilisation of historic tax losses. The Board believes this gives a better view of ongoing maintainable earnings. The table below sets out a reconciliation of the earnings used for the calculation of earnings per share to that used in the calculation of adjusted earnings per share:

£'000s

Six months to

31 December 2020

Six months to

 31 December 2019

12 months to

 30 June 2020

Profit used for calculation of basic and diluted EPS

1,313

37

487

Amortisation of acquired intangible assets

227

248

483

Change in fair value of contingent consideration

-

37

37

Post-completion services

59

33

33

Share-based payments

304

327

625

Unwinding of discount - contingent consideration & borrowings

59

67

123

Tax adjustment

(656)

(58)

(332)

Profit used for calculation of adjusted basic and diluted EPS

1,306

691

1,456

 

Pence

Six months to

31 December 2020

Six months to

 31 December 2019

12 months to

 30 June 2020

Adjusted basic earnings per share

0.90

0.48

1.01

Adjusted diluted earnings per share

0.87

0.46

0.97

 

5. Dividends

 

Dividends paid or declared during the period were as follows:

 

Six months to December 2020

Paid

Pence per share

Cash flow statement

(£'000)

Statement of changes in equity

(£'000)

December 2020 balance sheet

(£'000)

 

 

 

 

 

 

Final ordinary dividend for year to June 2020(1)

9/2/21

0.25p

-

369

369

 

 

 

-

369

369

 

Six months to December 2019

Paid

Pence per share

Cash flow statement

(£'000)

Statement of changes in equity

(£'000)

December 2019 balance sheet

(£'000)

 

 

 

 

 

 

Final ordinary dividend for year to June 2019

5/2/20

0.20p

-

287

287

 

 

 

-

287

287

 

(1) The final ordinary dividend for the year ended 30 June 2020 was approved at the Annual General Meeting held on 17 December 2020.

               

 

6. Net funds/ (debt) reconciliation

 

£'000

31 December 2020

31 December 2019

30 June  2020

Cash and cash equivalents

12,903

6,502

12,710

Borrowings - repayable after one year(1)

(6,802)

(6,689)

(6,745)

Lease liabilities

(953)

(833)

(1,150)

Net funds/ (debt)

5,148

(1,020)

4,815

 

(1) To support the acquisition of MatsSoft Limited in August 2017, the Company issued a £7m Loan Note with options over 4.8m new ordinary shares of 5p each priced at 58p. The Loan Note is unsecured, has an annual interest rate of 8.5% payable quarterly in arrears and is repayable in six instalments from 30 September 2022 to 31 March 2025. The Loan Note was initially allocated a fair value of £6.42m and the share option a fair value of £0.58m.  The discount on the carrying value of the Loan Note is being amortised via the profit and loss account over the expected option life of five years.

 

7. Acquisition of Oakwood Technologies BV

 

On 12 October 2020 the Company acquired 100% of the issued share capital of Oakwood Technologies BV (trading as 'Automagica'), an AI powered Robotic Process Automation software provider.

 

The Company assessed that substantially all of the fair value of gross assets acquired was concentrated in Automagica's software. It therefore elected to account for the transaction as an acquisition of assets under the amendments to IFRS 3 'Business Combinations' issued by IASB in October 2018. As such the consideration together with the direct acquisition-related expenses (less any tangible or financial assets assumed) has been attributed to the acquired software.

 

The fair value of consideration was £1.20m comprising:

 

 

 

 

£'000

Cash consideration - initial payment

 

 

987

Deferred cash consideration

 

 

99

Acquisition-related expenses

 

 

111

 

 

 

1,197

 

The consideration for the transaction comprised:

 

· cash consideration of €1.08m paid on completion in October 2020;

 

· deferred cash consideration of an undiscounted amount of €0.12m payable in October 2021; and

 

· contingent consideration of up to €0.90m in cash and up to €0.90m in Netcall shares payable dependent on specified performance targets during the 2-year period from completion of the acquisition.  As the contingent payments are reliant on the on-going provision of services to the business by the previous shareholders then:  the cash amounts earned will be expensed in the income statement as rendered; and, the share element will be charged to the income statement based on the fair value of shares that are ultimately expected to vest, in line with the requirements of IFRS 2 'Share-based payments'. 

 

The total contingent consideration expensed as post-completion services in the period was £59,000.

 

The assets and liabilities recognised as a result of the acquisition are as follows:

 

 

 

 

£'000

Intangible assets: proprietary software

 

 

1,203

Property, plant & equipment

 

 

2

Contract assets

 

 

-

Trade receivables

 

 

24

Other current assets

 

 

1

Cash & cash equivalents

 

 

13

Trade & other payables

 

 

(10)

Contract liabilities

 

 

(32)

Current tax liabilities

 

 

(2)

Net assets acquired

 

 

1,197

 

 

The cash outflow as a result of the acquisition is as follows:

 

 

 

 

£'000

Cash consideration - initial payment

 

 

987

Less: cash acquired

 

 

(13)

Acquisition-related expenses

 

 

10

Net cash out flow - investing activities

 

 

984

 

 

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [email protected] or visit www.rns.com.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.
 
END
 
 
IR ZZGZZRFRGMZM

a d v e r t i s e m e n t