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Total Systems PLC (TTS)

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Tuesday 01 July, 2008

Total Systems PLC

Final Results

RNS Number : 9408X
Total Systems PLC
01 July 2008
 



    

FOR RELEASE                                                          7:00 AM                                                                      1 JULY 2008


TOTAL SYSTEMS plc

Preliminary results for the year ended 31 March 2008

Return to revenue growth & profitability


Total Systems plc ('Total' or 'the Company'), suppliers of cost effective flexible software systems for the financial services industry, primarily in the insurance and warranty sectors, announces its preliminary results for the year ended 31 March 2008.


Commenting on the Company's results Terence Bourne, Chairman, said:


'This has been a successful year in the development of Total Systems. We have continued to enhance software applications and add new services for existing users. The previously announced commitment from Capita to adopt Ultima as their general insurance platform has started to bear fruit with a positive impact on results for the year. Together, we are delighted to be playing a part in bringing Sharia compliant insurance products to the UK market. Capita's 'Software as a Service' (SaaS) model for the insurance industry and Total's flexible systems are highly complimentary and this relationship should provide an excellent base to grow our revenues in the future. 


I am pleased by the insurance industry's reception to the recent launch of insureTrac, Total System's telematics based insurance solution. The UK's leading actuarial consultancy is contributing to this solution, as is a household name in global telecoms and this is extremely encouraging. Early signs are that this product offering will take your Company into market areas not previously penetrated.' 


Financial Highlights


  • Revenue


£ 4.05m


(2007: £ 3.36m)

  • Profit/(loss) before tax


£ 431k 


(2007: £ (530)k)

  • Basic earnings/(loss) per share


 2.99p


(2007: (3.98))

  • Gearing


Nil


(2007: Nil)

  • Net assets per share


38.68p


(2007: 35.45p)

  • Cash per share


22.90p


(2007: 22.62p)

 

Product Summary 


Ultima, the complete insurance and warranty solution, continues to bring significant business benefits to clients such as:


  • Low cost of ownership.

  • Integrated solution.

  • Flexibility. 

  • Simplicity and speed of making changes using Business Configurator.

  • Easy integration with external systems.

  • Service Oriented Architecture.

Regarding the Company's current trading and outlook, Terence Bourne added:


'At a time of considerable economic and financial uncertainty your Company is in good shape with current trading running at a satisfactory level. The sales and marketing team are proactively seeking new opportunities in our market place. We are seeing interest in all our products and the Company is stable and starting to grow its revenues. The launch of insureTrac has generated huge interest with our clients and sales prospects but there have been no orders at the time of writing. Although it is difficult to forecast in the present climate, on current trends we anticipate turnover for the year ending 31 March 2009 will be similar to the year ended 31 March 2008. The Board believes that the Company's strategy will bear fruit over the medium term.'



E-mail: [email protected]            web site: www.totalsystems.co.uk


Enquiries:

Terence Bourne, Chairman                        Total Systems plc                020 7294 4888

Granville Harris, Finance Director              Total Systems plc                020 7294 4888


Notes for Editors:


Based in the City of London Total provides cost effective flexible software systems for the financial services industry, primarily in the insurance and warranty sectors, as well as complementary IT consultancy, development, integration and support services.


The Company has a full listing on the London Stock Exchange. 


Significant investment has been made by the Company in developing Ultima (General insurance system for personal and commercial lines).


Examples of Total's clients for Ultima include Axa Insurance Services (Denplan), Capita, DSG International, HSBC Insurance and Zurich Insurance Company (Navigators & General).

  Chairman's Statement

                            

SUMMARY


This has been a successful year in the development of Total Systems. We have continued to enhance software applications and add new services for existing users. The previously announced commitment from Capita to adopt Ultima as their general insurance platform has started to bear fruit with a positive impact on results for the year. Together we are delighted to be playing a part in bringing Sharia compliant insurance products to the UK market. Capita's 'Software as a Service' (SaaS) model for the insurance industry and Total's flexible systems are highly complementary and this relationship should provide an excellent base to grow our revenues in the future. 


I am pleased by the insurance industry's reception to the recent launch of insureTrac, Total System's telematics based insurance solution. The UK's leading actuarial consultancy is contributing to this solution, as is a household name in global telecoms and this is extremely encouraging. Early signs are that this product offering will take your Company into market areas not previously penetrated. 


RESULTS


Revenue for the financial year 2008 was £4,048,015 (2007: £3,357,988) and the profit before tax was £430,590 (2007: loss £530,006) resulting in a profit per share of 2.99p (2007: loss per share 3.98p).


FINANCIAL


Zero gearing and net assets of 38.68p per share (2007: 35.45p), of which 22.90p per share is represented by cash (2007: 22.62p), demonstrates our financial strength. Our return on capital employed is 10.58% (2007: (14.21)%). 


DIVIDEND


No dividend is proposed or payable. 


STRATEGY


Our strategy is to provide software, support and expertise to help management in financial services companies achieve their objectives of becoming more efficient and profitable. To this end we offer flexible licensing models including 'per policy' charging.


The Ultima product has been enhanced and the Company has plans for further development over the coming year. Research and Development spending was £380,584 (2007: £528,984).


The Company is monitoring the market for complementary products to sell in order to give the sales and marketing team more touch points with existing and potential customers. In the longer term this will enhance sales and earnings and potentially lead the Company into new areas.


MARKET PLACE


There are a number of companies using outdated systems and running inefficient databases across disparate systems that would gain significantly from an integrated system. The insurance industry is also changing due to the influence of aggregators, new entrants and consolidation in the broking sector, but the influence of these changes should create further opportunities. Customer service is more important than ever as is the ability to differentiate and bring new and innovative products to market quickly.


The benefits of Ultima far outweigh any advantages offered from developing alternatives overseas or moving processing offshore. Ultima reduces IT costs and its integrated approach enhances customer service operations. The Business Configurator tool offers a fast route to market for new offerings. In addition, the emergence of large scale affinity relationships demands a system that can be flexible while coping with enormous amounts of interdependent data. Ultima, with Business Configurator, meets these demands.  

The Capita relationship with its integration skills and leverage opens up an opportunity for a key market presence.


ENVIRONMENTAL AND SOCIAL


The Company operates from a single site in premises it owns in central London. Every care is taken to ensure that the Company operates in an environmentally friendly way within the limitations imposed by our location and the nature of our operations. In regard to its employees and the local community the Company allows employees time to take part in their own social responsibilities as necessary. 


OPERATIONS


Our customers have continued to enhance and develop their systems during the year and your Company has provided full support to all aspects of their requirements. Combined with the Capita business coming on stream the Company has been able to achieve a 20.6% increase in revenue. The relationship with Capita is developing extremely well and in relation to our involvement with the Sharia compliant insurance product there appear to be a number of areas for future productive partnerships.


PERSONNEL


I would like to express my gratitude to staff who have shown their professionalism and dedication to the Company. Our average length of service is over nine years which demonstrates the effectiveness of the retention policies in place.


We encourage open communications to stimulate creative and innovative thinking. This combined with the wealth of experience of our staff ensures that we have a pool of very skilled and versatile employees capable of handling a wide range of challenges within our market. 


CURRENT TRADING AND OUTLOOK


At a time of considerable economic and financial uncertainty your Company is in good shape with current trading running at a satisfactory level. The sales and marketing team are proactively seeking new opportunities in our market place. We are seeing interest in all our products and the Company is stable and starting to grow its revenues. The launch of insureTrac has generated huge interest with our clients and sales prospects but there have been no orders at the time of writing. Although it is difficult to forecast in the present climate, on current trends we anticipate turnover for the year ending 31 March 2009 will be similar to the year ended 31 March 2008. The Board believes that the Company's strategy will bear fruit over the medium term.




    

Terence Bourne

Chairman

30 June 2008








TOTAL SYSTEMS plc


                            

Consolidated Income Statement

For the year ended 31 March 2008


 

Note

2008

 

2007

 


£

£

Continuing operations








Revenue

2

4,048,015

3,357,988



-------------

-----------

Operating profit/(loss)


301,412

(670,349)





Interest receivable and similar income


129,178

140,626





Interest payable and similar charges


-

(283)



------------

-----------

Profit/(loss) before taxation


430,590

(530,006)





Tax (payable)/credit


 (115,793)

111,133



------------

-----------

Profit/(loss) after taxation for the year


314,797

(418,873)



------------

-----------





Basic earnings/(loss) per ordinary share

4

2.99p

(3.98)p





Diluted earnings/(loss) per ordinary share


2.99p

(3.98)p


There is no recognised income or expense for the current or prior year other than as stated above. As a consequence a statement of recognised income and expenses is not presented.


All the Group's operations are undertaken by the Company.























Consolidated Balance Sheet

At 31 March 2008




2008


2007


£

£

£

£

ASSETS










Non-current assets





Property, plant and equipment

921,181


1,040,102


Deferred tax assets

-


53,022



-------------


----------


Total non-current assets


921,181


1,093,124






Current assets





Trade and other receivables

1,627,666


845,810


Cash and cash equivalents

2,409,436


2,380,016



-------------


-----------


Total current assets


4,037,102


3,225,826



-------------


------------






TOTAL ASSETS


4,958,283


4,318,950



-------------


-----------






LIABILITIES










Current liabilities





Trade and other payables

(826,369)


(590,027)


Current tax liabilities

(54,122)


-



--------------


-----------


Total current liabilities


(880,491)


(590,027)



-------------


-----------






Non-current liabilities





Deferred tax liabilities


(8,649)


-



-------------


-----------






TOTAL LIABILITIES


(889,140)


(590,027)



------------


-----------






NET ASSETS


4,069,143


3,728,923



------------


-----------






Shareholders equity





Issued share capital


525,978


  525,978

Share premium


83,010


  83,010

Retained earnings


3,407,337


3,077,875

Stock option reserve


52,818


42,060



-------------


-----------






TOTAL EQUITY


4,069,143


3,728,923



------------


-----------



Consolidated Cash Flow Statement

For the year ended 31 March 2008



Note

2008    

2007



£

£ 

£

£

Operating activities






Cash received from customers


4,149,475


4,101,042


Cash payments to suppliers    


(833,114)


(987,877)


Cash payments to employees


(1,705,056)


(1,787,743)


Cash paid for PAYE and National Insurance



(1,084,266)



(1,118,556)


Cash paid for VAT


(620,886)


(663,419)


Other business payments


(33,940)


(45,869)




-----------


------------









Cash outflow from operating activities


7



(127,787)



(502,422)







Income taxes received/(paid)



52,567


(52,567)




------------


-----------







Net cash outflow from operating activities




(75,220)



(554,989)







Cash flows from investing activities












Interest received


129,178


140,626


Receipts on sale of assets


-


327


Purchase of plant and equipment


(24,538)


(335,934)




-------------


----------








Net cash inflow/(outflow) from investing activities




104,640



(194,981)







Cash flows from financing activities






Interest paid


-


(283)


Equity dividends paid


-


(94,676)




-----------


-----------








Net cash outflow from financing activities




-



(94,959)




-----------


-----------







Net change in cash and cash equivalents




29,420



(844,929)







Opening cash and cash equivalents



2,380,016


3,224,945




-------------


-------------







Closing cash and cash equivalents



2,409,436


2,380,016



-------------


-----------


All the Group's operations are undertaken by the Company.

    

  General Notes:

1. The financial information contained in this statement does not constitute the statutory accounts for the years ended         31 March 2008 and 2007, as defined in section 240 of the Companies Act 1985, but is derived from those accounts. The statutory accounts for the year ended 31 March 2007 have been delivered to the Registrar of Companies and those for 31 March 2008 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 Section 237(2) or Section 237(3) of the Companies Act 1985.

 

2. The Group's revenue is derived from the writing and supply of its computer software and supply of third party software both with related support services in the United Kingdom. All activities derive from continuing operations segmented as follows:




2008

2007


£

£

Time & materials

3,368,243

2,507,853

Own software licences and maintenance

477,511

563,717

Third party software licences and maintenance

202,261

286,418


---------------

--------------


Total revenue


4,048,015



3,357,988


-------------

-------------



3. The announcement has been prepared on the basis of the accounting policies as per the prior year and in accordance with International Financial Reporting Standards (IFRS). 


4. The calculation of basic earnings per share is based on a profit after taxation of £314,797 (2007: loss £418,873) and a weighted average of 10,519,553 shares (2007: 10,519,553) in issue during the period.


5. It is intended to post the Annual Report to shareholders on 4 July 2008. Copies will then be available from the Registered Office of the Group at 394 City RoadLondonEC1V 2QA.


6. The Annual General Meeting will be held at 394 City RoadLondonEC1V 2QA on 11 August 2008 at 10.00 a.m.


7. Reconciliation of operating profit/(loss) to net cash outflow from operating activities:




2008

2007


£

£

Operating profit/(loss)

301,412

(670,349)

Depreciation charges

142,055

117,906

(Increase)/decrease in receivables

(834,423)

60,509

Increase/(decrease) in payables

236,342

(38,721)

Loss/(profit) on sale of assets

1,404

(327)

Charge for share based payments

25,423

28,560


---------

---------




Net cash outflow from operating activities

(127,787)

(502,422)


------------

---------



    

8.    Changes in Company and consolidated equity shareholders' funds:



Issued

share

capital

Share

premium

Retained

earnings

Stock

option

reserve

Total

equity


£

£

£

£

£

As at 1 April 2006

525,978

83,010

3,591,424

13,500

4,213,912

Loss after tax for the year

-

-

(418,873)

-

(418,873)

Final dividend paid

-

-

(94,676)

-

(94,676)

Share based payments

-

-

-

28,560

28,560


---------

--------

-----------

--------

-----------

As at 31 March 2007

525,978

83,010

3,077,875

42,060

3,728,923

Profit after tax for the year

-

-

314,797

-

314,797

Share options lapsed

-

-

14,665

(14,665)

-

Share based payments

-

-

-

25,423

25,423


---------

---------

------------

--------

------------

As at 31 March 2008

525,978

83,010

3,407,337

52,818

4,069,143


---------

---------

------------

--------

------------




ENDS


This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
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