Interim Results

RNS Number : 5765P
OMG PLC
09 June 2015
 

9 June 2015

 

OMG plc

 

("OMG" or the "Group")

 

Interim Results for the six months ended 31 March 2015

 

OMG plc (LSE: OMG), the technology group providing Computer Vision products and services for the entertainment, life science, engineering industries and consumer electronics markets, announces interim results for the six months ended 31 March 2015.

 

Financial Key Points from continuing operations

 

For comparative purposes the performance of 2d3 has now been classified as a discontinued operation in these results.

 

·      Group Revenue of £11.3m down 4.4% (H1FY14: £11.8m)

o Revenue impacted by single large Vicon deal, expected in H1 but delivered early in H2

·      Group adjusted* loss before tax of £0.7m (H1FY14: adjusted* loss before tax of £0.6m)

Overall, Group trading is in line with achieving market expectations for the full year

·      Group cash position increased from £6.5m to £8.6m in the period

Post period end, cash position following disposal of 2d3 stood at £21.7m as at 10 April 2015

·      Dividend of 4.5p paid on 15 May 2015 returning £5.1m of 2d3 proceeds to shareholders

·      Further Special Dividend announced today of 5p per share returning £5.7m proceeds to shareholders

 

Operational Key Points

 

Vicon

o Secured a variety of deals across a number of industry sectors

o Motion capture used in recent film releases: Paddington, Jupiter Ascending and American Sniper

o Released Vicon Lock, a new control system for connecting, integrating and synchronizing third-party devices with Vicon systems, including the Bonita camera

o Commenced Innovate UK project with the aim of developing new, innovative technologies to drive future growth and profits

 

·      Yotta

o Secured new customers for Horizons: Southampton City Council & Herefordshire County Council

o Yotta won its first Horizons customer in Scotland with North Ayrshire

o Mayrise software wins at Doncaster MBC and Portsmouth City Council

o Synergy between the Horizons and Mayrise applications seen in win with Newport City Council

o Post-period end, Yotta expanded into Europe, securing its first software contract outside the UK with a Dutch infrastructure services company

 

·      2d3

o Post period end, successful sale of 2d3

o Sold to Insitu Inc., a subsidiary of The Boeing Company, for $25m (approx. £16.8m)

o Profit before tax of the transaction of $16.4m (approx. £11.0m)

o Net cash generated from the transaction of $16.9m (approx. £11.3m)

o Sale reduces volatility of Group revenue and profit streams and enhances future visibility of earnings

 

·      OMG Life

o Life is now well positioned to realise value from its IP with a strong pipeline of opportunities

o Continue to receive interest in IP from a wide variety of consumer technology businesses

o Two potential licensees have now entered more formal negotiations, which remain ongoing

 

* Profit before tax from continuing operations before group recharges adjusted for share based payments, amortisation of intangibles arising on acquisition, fair value adjustment to contingent consideration, unwinding of discount on contingent consideration, acquisition costs and redundancy costs.

 

 Commenting on the results Nick Bolton, Chief Executive Officer said:

 

"The Group has made strong progress in the first half. We are pleased that our efforts to realise value for shareholders continued with the successful sale of 2d3, which even after the payment of dividends strengthens the Group's healthy cash resources and creates a revenue base that is expected to be smoother and more predictable moving forward.

 

As we enter the second half, we believe that we have a solid platform in place and we remain focused on actively pursuing new routes such as licensing or partnership to maximise the value of our IP and to generate further shareholder value."

 

For further information please contact:

 

OMG plc

+44 (0) 1865 261800

Nick Bolton, CEO

 

David Deacon, CFO

 

 

 

FTI Consulting

+44 (0) 20 3727 1000

Matt Dixon / Emma Appleton / Harry Staight

 

 

 

N+1 Singer (NOMAD to OMG)

+44 (0) 20 3205 7500

Shaun Dobson / Jen Boorer

 

 

About OMG plc

 

OMG plc (Oxford Metrics Group. LSE: OMG) is a group of technology companies producing Computer Vision products and services for the entertainment, life science, engineering industries and consumer electronics markets.

 

The Group's technology is used globally to capture the movements of actors (for the movie industry), sportsmen and women (for video games or improving team performance), and children with cerebral palsy, rehab patients and animals (for medical, life science and research industries). The technology is also used for the management of highways and other forms of distributed infrastcture assets, such as lighting systems and other street furniture. Through this diverse offering the Group has earned its strong international reputation for precision from pixels and its unique expertise in imaging technology.

 

Founded in 1984, the Group is headquartered in Oxford, UK, and has two offices in the US and four in the UK. It has customers in over 50 countries and is a quoted company listed on AIM, a market operated by the London Stock Exchange. The Group trades through three subsidiaries: Vicon, the world's largest motion capture and movement analysis company, Yotta, a provider of software and services for infrastructure asset management and OMG Life, our IP licensing business, which is focused on unlocking latent value in OMG's IP.

 

The Group's global clients spanning the worlds of science, medicine, sport, engineering, gaming, film and broadcast include: major hospitals and research facilities such as Guy's Hospital, Nuffield Orthopedic Centre, Headley Court and Loughborough University, engineering industry leaders including: Ford Motor Company, BMW, Toyota and European Space Agency and in the entertainment sector; The Imaginarium, Sony, Industrial Light and Magic, Sega, Nintendo, UbiSoft, EA and Square Enix. In infrastructure asset management, clients include Highways England, East Sussex, Kent, Lancashire, Transport for London, UK Power Network, Cheshire East and West as well as many others.

 

 Chairman and Chief Executive's Statement

 

Overall, the Group has had a good start to 2015. Vicon has delivered a solid first half performance with notable wins across all of its markets; Yotta has delivered improved revenues and profits driven by the continued success of its software business; and OMG Life continues to attract interest from several consumer technology businesses with formal licensing discussions ongoing.

 

The first six months of the financial year has seen the shape of the Group develop well through a number of strategically important and proactive changes that have been made in the business. The most significant development was the sale of our 2d3 defence software division to Insitu Inc., a subsidiary of The Boeing Company on 10 April 2015, for $25m (approx. £16.8m). This move was a positive and important step for the Group as it delivered on the founding ambition of OMG - to take great technology, nurture it, build it, amplify the value through acquisition and ultimately realise meaningful shareholder value from those efforts.

 

The disposal of 2d3 reduces the volatility of Group revenue and profit streams and enhances future visibility of earnings. This transaction combined with the disposal of House of Moves in October 2014, means that the Group has emerged as a more predictable business. 2d3 and the cash it has provided has emboldened our position. Our strategy has not changed and moving forward, we will continue to seek maximum shareholder returns. 2d3 will no doubt continue to thrive as part of Insitu Inc., and we would like to take this opportunity to wish our former colleagues success in the future. For comparative purposes the performance of 2d3 has now been classified as a discontinued operation in these results.

 

In addition to the 4.5p per share special dividend announced following the disposal of 2d3, the Group is pleased to announce a further Special Dividend of 5.0p per share will be paid on 10 July 2015, following an ex-dividend date of 18 June 2015 to all shareholders on the register on 19 June 2015.

 

Financial Summary

 

KPI

H1 FY15

H1 FY14

Change

Group Revenue

£11.3m

£11.8m

-£0.5m

Group Cash Position

£8.6m

£6.5m

+£2.1m

Group Adjusted* Loss before Tax

(£0.7m)

(£0.6m)

-£0.1m

 

During the first half, Group revenue decreased year-on-year by 4.4% to £11.3m (H1 FY14: £11.8m). This change in revenue is accounted for by a single large Vicon deal which was expected in the first half, but was delivered early in this current second half. This has also had a follow on impact on reported profits and accordingly the Group reports an adjusted loss before tax for the period of £0.7m (H1 FY14: loss before tax of £0.6m).  

 

Group cash position as at 31 March 2015 stood at £8.6m (H1 FY14: £6.5m). Post period end, following the successful sale of 2d3 cash strengthened to £21.7m as at 10 April 2015 prior to the payment of a £5.1m Special Dividend.

 

OMG Vicon

 

 

Revenue

PBT

Adjusted* PBT

 

H1 FY15

H1 FY14

H1 FY15

H1 FY14

H1 FY15

H1 FY14

Vicon UK / ROW

£4.5m

£4.9m

£1.3m

£1.5m

£1.0m

£1.3m

Vicon US

£3.1m

£3.3m

£0.1m

£0.1m

£0.8m

£1.0m

Total Vicon

£7.7m

£8.2m

£1.4m

£1.6m

£1.8m

£2.3m

 

Our Vicon business reported a solid start to FY15. Revenues in UK / Rest of World ("ROW") were slightly lower compared with a year ago by 7.0% which is accounted for by one significant deal moving into the second half which Vicon has now delivered. Vicon reported an adjusted profit before tax of £1.8m (H1 FY14: £2.3m). The decline is primarily attributed to lower revenues and additional costs associated with the Innovate UK project. Vicon gross margins were slightly better compared to the prior year and the business is currently undergoing a programme of modest cost reductions which will lower the cost base.

 

The first half saw Vicon win a variety of deals in a number of sectors such as automotive (Suzuki, Maserati), education (Gallaudet University for sign language studies), Gaming (EA and Capcom), industrials (Boeing), retail (Champion Sport Wear for clothes design) and technology (Clearpath Robotics). In addition, our technology has been used in recent film releases including Paddington, Jupiter Ascending and American Sniper.

 

During the period, Vicon's development efforts saw the release of Vicon Lock, the division's new control system for connecting, integrating and synchronizing third-party devices with Vicon systems which is expected to enhance the accessibility of our highly popular Bonita camera series.

 

At the time of our Preliminary Results in December 2014, it was highlighted that Vicon had been awarded a grant by Innovate UK. This project has recently begun and we are using the grant to help develop new, innovative technologies to drive future growth and profits. Whilst there is a net cost to Vicon in the short-term the project is expected to deliver new adjacent technologies, which will help to drive growth in future years.

 

Overall, the outlook for Vicon in the second half remains solid and is expected to have a stronger trading period than the first half, which has often been the case in previous years, and is on track to deliver expectations.

 

OMG Yotta

 

 

Revenue

PBT

Adjusted* PBT

 

H1 FY15

H1 FY14

H1 FY15

H1 FY14

H1 FY15

H1 FY14

Yotta

£3.6m

£3.3m

(£0.1m)

(£0.2m)

£0.5m

£0.3m

 

Yotta reported revenues up 8.7% compared to the same period last year at £3.6m (H1 FY14: £3.3m). This increase has been achieved through the growth of the software and consulting services parts of the business. Yotta reported an adjusted profit before tax of £0.5m (H1 FY14: £0.3m).

 

Yotta's Horizons, its SaaS Visualised Asset Management system, continued to see strong growth and the UK now has 46 (H1 14: 37) customers. Yotta secured new customers for Horizons during the half including Southampton City Council, Herefordshire County Council and North Ayrshire, which is Yotta's first Horizons customer in Scotland. Post-period end, Yotta also expanded its reach into Europe, securing a contract with De Jong Zuurmond, a Dutch infrastructure services company, via Yotta's new distributor Wegdekmeten. This is the first order and application of Horizons outside of the UK, it represents a major milestone as the business shifts to be more SaaS orientated, and further international opportunities are being explored.

 

Further, Yotta also secured wins for its Mayrise software with Doncaster MBC and Portsmouth City Council among the highlights. The company continues to see synergy between the Horizons and Mayrise applications, exemplified in the recent win at Newport City Council, who continued to expand their use of Yotta's applications with the purchase of Horizons and mobile functionality for their Mayrise system.

 

The continued success of Horizons and Mayrise has seen increased engagement with our customers and high levels of customer retention. Demand for our consulting services has been high with year-on-year revenues up by 13% and has led Yotta to deliver a wide range of software and non-software related services to many customers, from training to strategic-level Asset Management advice.

 

The combined software and services business now has annual recurring revenues of £3.1m (H1 FY14: £2.4m) and software and related revenues accounted for 61% of H1 revenues (H1 FY14: 46%).

 

The surveying activities also saw success. Notable wins included Amey Plc, Cumbria County Council, Lincolnshire County Council, Rochdale MBC, Hertfordshire County Council and Milton Keynes. The development of Yotta's new Asset Video capture machine was also underway during the period and it will be carrying out contracts in the second half. Whilst Yotta's surveying activities were hampered by the wet winter, on a positive note the surveying teams have won new business with Hounslow Highways as well as with Liverpool, Hertfordshire and Hampshire Councils.

 

Yotta continues to grow as it evolves into an increasingly reliable, recurring-revenue based software and services business. The outlook for the second half is encouraging for Yotta and the division remains on track to deliver expectations.

 

 OMG Life

 

 

Revenue

PBT

Adjusted* PBT

 

H1 FY15

H1 FY14

H1 FY15

H1 FY14

H1 FY15

H1 FY14

Life

£0.0m

£0.3m

(£2.7m)

(£2.2m)

(£1.7m)

(£2.1m)

 

The reported adjusted loss for OMG Life of £1.7m (H1: FY14 loss: £2.1m) includes the full-write-down of previously capitalised Autographer specific IP of £0.8m (H1 FY14 £0.5m). The one-off costs associated with the termination of staff and relationship with our contract manufacturer have been reported as exceptional costs. The revised cost base of £0.9m per year partially benefited the first half and will fully benefit the second half. The Balance Sheet includes capitalised R&D of £1.3m (H1 FY14: £1.8m) relating to image capture IP.

 

This IP enables the capture of optimal imagery, including both video and stills. This means consumers can get a high quality shot or video sequence regardless of camera motion, difficult lighting conditions or even photographic ability, even with relatively low cost components. The development of these capabilities has proven timely as manufacturers seek to realise differentiation in the rapidly growing marketplaces of action cameras and newer social cameras and in the more traditional tablet and smartphone markets.

 

We continue to receive interest from a wide variety of consumer technology businesses, who have seen the promise and potential in the core IP within Life. These initial conversations have since evolved into detailed discussions as to how the technology can be best utilised within the potential licensees' forthcoming product ranges. These discussions continue with a relatively large number of organisations but two specific licensees have now entered more formal negotiations. These remain ongoing and we are focused on securing a tangible benefit in H2 2015 to underpin the confidence in the division's expectations for the year as a whole. Life is now well positioned to realise value from its IP and we remain excited about the future potential for the OMG Life business in its new form and see valuable opportunities ahead.

 

Outlook

 

Post 2d3, our strategy remains to generate shareholder value by taking world-class IP, developed primarily in Britain, and monetizing it through commercial sales. This is something we have proven we can do throughout our history - be that through building up Vicon to a position of profitable market leadership; through the scale up and sale of 2d3 to a strong partner for a significant premium; and indeed in the potential Yotta is now showing as an increasingly visible, dependable revenue performer.

 

Looking ahead, OMG will continue to build out the predictability and profitability of our Group revenue streams and will consider new routes such as licensing or partnership to maximise the value of our IP. Where possible we will continue to embolden our position via further corporate activity, where it enhances the quality of our revenue base.

With our strategic priorities unchanged, The Board remains confident in the strength of our diversified offering and position in key global markets; and thus of our ability to deliver sustained, balanced and profitable growth over the long term.

 

As we enter the second half notwithstanding macro-economic uncertainty, the Board is confident that with the expected performance across the three divisions the Group is on track to meet current market expectations for the year as a whole.

 

 

 

 

CONDENSED CONSOLIDATED INCOME STATEMENT

 

 

 

 

Six months ended 31 March 2015 (unaudited)

Six months ended 31 March 2014 restated (unaudited)

Year ended 30 September 2014 restated (audited)

 

 

 

 

Continuing operations

 

Discontinued operations

 

Continuing operations

 

Discontinued operations

 

 

Total

 

Continuing operations

 

Discontinued operations

 

 

Total

 

 

Note

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

 

Revenue

2

11,316

2,028

11,842

2,493

14,335

25,631

7,810

33,441

 

Cost of sales

 

(4,276)

(894)

(5,170)

(4,908)

(996)

(5,904)

(9,704)

(3,046)

(12,750)

 

Gross profit

 

7,040

1,134

6,934

1,497

8,431

15,927

4,764

20,691

 

Sales, support and marketing costs

 

(2,465)

(259)

(2,752)

(737)

(3,489)

(6,194)

(372)

(6,566)

 

Research and development

 

(2,323)

(235)

(1,713)

(760)

(2,473)

(4,038)

(222)

(4,260)

 

Administrative expenses

 

(3,650)

(2,137)

(3,318)

(1,258)

(4,576)

(5,802)

(4,700)

(10,502)

 

Other operating income

 

33

-

33

23

-

23

56

6

62

 

Operating loss

 

(1,365)

(1,497)

(2,862)

(826)

(1,258)

(2,084)

(51)

(524)

(575)

 

Finance income

 

17

-

5

6

11

6

-

6

Finance expense

 

(5)

(3)

(8)

(5)

(3)

(8)

(10)

(5)

(15)

 

Loss before taxation

2,3

(1,353)

(1,500)

(826)

(1,255)

(2,081)

(55)

(529)

(584)

 

Taxation

4

775

111

886

149

449

598

(49)

63

14

 

Loss for the period attributable to

owners of the parent during the period

 

(578)

(1,389)

(1,967)

(677)

(806)

(1,483)

(104)

(466)

(570)

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic loss per share (pence)

5

(0.51)p

(1.22)p

(0.62)p

(0.74)p

(1.36)p

(0.09)p

(0.42)p

(0.51)p

 

Diluted loss per share (pence)

5

(0.51)p

(1.22)p

(0.62)p

(0.74)p

(1.36)p

(0.09)p

(0.42)p

(0.51)p

 

 

 

 

 

 

 

 

 

 

 

                       

 

 

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

 

 

 

Six months ended

31 March

2015

Six months ended

 31 March

2014

Year

ended

 30 September 2014

 

 

(unaudited)

(unaudited)

(audited)

 

 

£'000

£'000

£'000

Net loss for the period

 

(1,967)

(1,483)

(570)

Other comprehensive income

 

 

 

 

Exchange differences on retranslation of overseas subsidiary

 

471

(109)

20

Tax recognised directly in equity

 

221

(6)

23

Total other comprehensive income

 

692

(115)

43

Total comprehensive income for the period attributable to the owners of the parent

 

(1,275)

(1,598)

(527)

 

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

 

 

 

31 March

2015

31 March

2014

30 September

2014

 

 

(unaudited)

(unaudited)

(audited)

 

Note

£'000

£'000

£'000

Non-current assets

 

 

 

 

Goodwill and intangible assets

 

12,255

17,395

16,686

Property, plant and equipment

 

1,184

2,156

1,387

Financial asset - investment

 

69

69

69

Deferred consideration receivable

 

319

-

-

Deferred tax asset

 

985

1,441

614

 

 

14,812

21,061

18,756

Current assets

 

 

 

 

Inventories

 

1,683

2,322

1,691

Trade and other receivables

 

7,976

9,682

13,176

Cash and cash equivalents

 

8,563

6,529

7,579

 

 

18,222

18,533

22,446

 

 

 

 

 

Assets classified as held for sale

 

5,528

-

720

 

 

 

 

 

Current liabilities

 

 

 

 

Trade and other payables

 

(6,237)

(7,262)

(8,640)

Current tax liabilities

 

(8)

(117)

(139)

 

 

(6,245)

(7,379)

(8,779)

 

 

 

 

 

Liabilities directly associated with assets classified as held for sale

 

(1,634)

-

(45)

 

 

 

 

 

Net current assets

 

15,871

11,154

14,342

Total assets less current liabilities

 

30,683

32,215

33,098

 

Non-current liabilities

 

 

 

 

Financial liabilities

 

-

(7)

-

Deferred tax liability

 

(1,578)

(2,451)

(2,280)

 

 

(1,578)

(2,458)

(2,280)

 

 

 

 

 

Net assets

 

29,105

29,757

30,818

 

 

 

 

 

Capital and reserves attributable to the owners of the parent

 

 

 

 

Share capital

6

283

283

283

Shares to be issued

 

65

65

65

Share premium account

 

15,443

15,443

15,443

Merger reserve

 

6,589

6,589

6,589

Retained earnings

 

6,309

7,561

8,493

Foreign currency translation reserve

 

416

(184)

(55)

Total equity shareholders' funds

 

29,105

29,757

30,818

 

CONDENSED CONSOLIDATED STATEMENT OF CASHFLOWS

 

 

 

Six months

ended

31 March

2015

Six months ended

31 March

2014

Year

ended

30 September 2014

 

 

(unaudited)

(unaudited)

(audited)

 

 

£'000

£'000

£'000

Cash flows from operating activities

 

 

 

 

Operating (loss)/profit

 

(1,365)

(2,084)

414

Depreciation and amortisation

 

1,470

1,757

3,511

Impairment of intangibles

 

415

-

287

(Profit)/loss on sale of property, plant and equipment

 

(69)

(1)

4

Loss on disposal of discontinued operations

 

167

-

-

Share based payments

 

114

199

189

Exchange adjustments

 

(36)

181

27

Decrease/(increase) in inventories

 

50

(495)

145

Decrease/(increase) in receivables

 

1,173

1,120

(2,008)

(Decrease)/increase in payables

 

(327)

212

1,240

Cash generated from continuing operations

 

1,592

889

3,809

Discontinued operations

 

1,248

-

(221)

Cash generated from operating activities

 

2,840

889

3,588

Tax received/(paid)

 

12

(270)

(261)

Net cash from operating activities

 

2,852

619

3,327

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

Purchase of property, plant and equipment

 

(321)

(471)

(712)

Purchase of intangible assets

 

(1,289)

(1,048)

(2,533)

Proceeds on disposal of property, plant and equipment

 

181

141

292

Proceeds from the sale of discontinued operations net of cash disposed of

 

255

-

-

Interest received

 

12

11

6

Net cash used in investing activities

 

(1,162)

(1,367)

(2,947)

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

Payment of finance lease liabilities

 

(45)

(55)

(111)

Interest element of finance lease repayments

 

(5)

(5)

(10)

Other interest paid

 

(3)

(3)

(5)

Equity dividends paid

 

(567)

(429)

(429)

Net cash used in financing activities

 

(620)

(492)

(555)

 

 

 

 

 

Net increase/(decrease) in cash and cash equivalents

 

1,070

(1,240)

(175)

Cash and cash equivalents at beginning of the period

 

7,628

7,803

7,803

Effect of exchange rate changes

 

160

(34)

-

Cash and cash equivalents at end of the period

 

8,858

6,529

7,628

 

 

 

 

 

Amount included in cash and cash equivalents

 

8,563

6,529

7,579

Amount included in assets classified as held for sale

 

295

-

49

Total cash and cash equivalents at end of the period

 

8,858

6,529

7,628

 

CONDENSED CONSOLIDATED STATEMENT OF CHANGES TO EQUITY

 

 

Share

Capital

Shares

to be

issued

Share premium account

Merger reserve

Retained earnings

Foreign currency translation reserve

Total

 

£'000

£'000

£'000

£'000

£'000

£'000

£'000

Balance as at 1 October 2014

283

65

15,443

6,589

8,493

(55)

30,818

Net loss for the period

-

-

-

-

(1,967)

-

(1,967)

Exchange differences on retranslation of overseas subsidiaries

-

-

-

-

-

471

471

Tax recognised directly in equity

-

-

-

-

221

-

221

Transactions with owners:

 

 

 

 

 

 

 

Dividends

-

-

-

-

(567)

-

(567)

Movement in relation to share based payments

-

-

-

-

129

-

129

Balance as at 31 March 2015

283

65

15,443

6,589

6,309

416

29,105

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance as at 1 October 2013

260

65

15,443

4,008

9,280

(75)

28,981

Net loss for the period

-

-

-

-

(1,483)

-

(1,483)

Exchange differences on retranslation of overseas subsidiaries

-

-

-

-

-

(109)

(109)

Tax recognised directly in equity

-

-

-

-

(6)

-

(6)

Transactions with owners:

 

 

 

 

 

 

 

Dividends

-

-

-

-

(429)

-

(429)

Issue of share capital

23

-

-

2,581

-

-

2,604

Movement in relation to share based payments

-

-

-

-

199

-

199

Balance as at 31 March 2014

283

65

15,443

6,589

7,561

(184)

29,757

 

 

 

 

 

 

 

 

 

Share

Capital

Shares

to be

issued

Share premium account

Merger reserve

Retained earnings

Foreign currency translation reserve

Total

 

£'000

£'000

£'000

£'000

£'000

£'000

£'000

Balance as at 1 October 2013

260

65

15,443

4,008

9,280

(75)

28,981

Net loss for the year

-

-

-

-

(570)

-

(570)

Exchange differences on retranslation of overseas subsidiaries

-

-

-

-

-

20

20

Tax recognised directly in equity

-

-

-

-

23

-

23

Transactions with owners:

 

 

 

 

 

 

 

Dividends

-

-

-

-

(429)

-

(429)

Issue of share capital

23

-

-

2,581

-

-

2,604

Movement in relation to share based payments

-

-

-

-

189

-

189

Balance as at 30 September 2014

283

65

15,443

6,589

8,493

(55)

30,818

 

 

 

 

 

 

 

 

The accompanying notes are an integral part of this interim financial information

 

NOTES TO THE CONDENSED CONSOLIDATED INTERIM STATEMENTS

 

1.  Basis of preparation

 

OMG Plc (the "Company") is a company domiciled in England.  The condensed consolidated interim financial statements of the Company for the six months ended 31 March 2015 comprise the Company and its subsidiaries (together referred to as the "Group").

 

The following IFRIC amendments and IASs have been issued by the IASB, but are applicable to future periods. They are not expected to have any material impact on the Group's reporting:

 

·      IFRS 5 'Non-current Assets Held for Sale and Discontinued Operations'

·      IFRS 9 'Financial Instruments'

·      IFRS 10 'Consolidated Financial Statements'

·      IFRS 12 'Disclosure of Interests in Other Entities'

·      IFRS 15 'Revenue from contracts with customers'

·      IAS 24 'Related Party Disclosures' (revised)

·      IAS 27 'Separate Financial Statements' (revised)

·      Amendment to IAS 32 'Financial Instruments: Presentation'

·      Amendment to IAS 36 'Impairment of Assets'

 

Otherwise, the condensed consolidated interim financial statements have been prepared using accounting policies consistent with those of the annual financial statements for the year ended 30 September 2014.  They are in accordance with IAS 34.

 

The interim financial statements have not been audited or reviewed and the financial information contained in this report does not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006. The comparative figures for the year ended 30 September 2014 are not the statutory accounts but have been extracted from the Group's 2014 financial statements which have been delivered to the Registrar of Companies.The auditors' report on those financial statements was unqualified did not contain references to any matters to which the auditors drew attention without qualifying the report and did not contain a statement under Section 498(2) or (3) of the Companies Act 2006. 

 

2.  Segmental reporting

 

Segment information is presented in the condensed consolidated interim financial statements in respect of the Group's business segments, which are reported to the Chief Operating Decision Maker (CODM). The Group has identified the Board of Directors of OMG plc ("the Board") as the CODM. The business segment reporting reflects the Group's management and internal reporting structure.

The Group comprises the following business segments:

 

Vicon Group:  This is the development, production and sale of computer software and equipment for the entertainment, engineering and life science markets;

 

Yotta Group:  This is services for the management of infrastructure and taxation, highway surveying and associated software development;

2d3 Group:  This is the development and sale of computer software for the defence market;

 

OMG Life:  This is the consumer electronics segment.

 

Other unallocated costs represent head office expenses not recharged to subsidiary companies.

 

Business segments are analysed below:

 

 

Revenue

 

Six months ended 31 March 2015 (unaudited)

Six months  ended 31 March 2014 restated (unaudited)

Year ended 30 September 2014 restated   (audited)

 

£'000

£'000

£'000

 

 

 

 

Vicon UK

4,547

4,923

9,626

Vicon USA

3,108

3,304

7,556

Vicon Group

7,655

8,227

17,182

 

 

 

 

Yotta UK

2,321

2,194

5,397

Yotta Mayrise

1,302

1,140

2,505

Yotta Group

3,623

3,334

7,902

 

 

 

 

OMG Life UK

73

281

325

OMG Life US

(35)

-

222

Life Group

38

281

547

 

 

 

 

Continuing operations

 

11,316

11,842

25,631

 

 

 

 

House of Moves

38

1,156

2,245

 

 

 

 

2d3 UK

379

420

631

2d3 USA

1,611

917

4,934

2d3 Group

1,990

1,337

5,565

 

 

 

 

Discontinued operations

 

2,028

2,493

7,810

 

 

 

 

OMG Group

13,344

14,335

33,441

  

 

 

Revenue

 

Six months ended 31 March 2015 (unaudited)

Six months  ended 31 March 2014 restated (unaudited)

Year ended 30 September 2014 restated   (audited)

 

£'000

£'000

£'000

By destination

 

 

 

UK

4,400

4,206

9,335

Europe

1,203

1,089

3,034

North America

2,921

 

2,968

 

6,582

Asia Pacific

2,499

3,333

5,847

Other

293

246

833

Continuing operations

 

11,316

11,842

25,631

 

 

 

 

UK

238

437

531

Europe

143

-

106

North America

 

1,647

 

1,551

 

6,663

Asia Pacific

-

505

510

Discontinued operations

 

2,028

2,493

7,810

 

 

 

 

OMG Group

13,344

14,335

33,441

 

 

 

 

By origin

 

 

 

UK

6,941

8,538

17,853

North America

 

4,375

 

3,304

 

7,778

Continuing operations

 

11,316

11,842

25,631

 

 

 

 

UK

379

420

631

North America

 

1,649

 

2,073

7,179

Discontinued operations

 

2,028

2,493

7,810

 

 

 

 

OMG Group

13,344

14,335

33,441

  

 

 

Six months ended 31 March 2015 (unaudited)

Six months  ended 31 March 2014 (unaudited)

Year ended 30 September 2014   (audited)

 

 

 

 

 

£'000

£'000

£'000

Vicon revenue by market

 

 

 

Engineering

2,075

1,400

3,177

Entertainment

1,939

1,988

4,329

Life sciences

3,641

4,839

9,676

Vicon Group

7,655

8,227

*17,182

 

*This additional information is provided to the Chief Operating Decision Maker.  Further analysis by market is not available.

 

 

 

 

Six months ended 31 March 2015 (unaudited)

Six months ended 31 March 2014 restated (unaudited)

Year ended 30 September 2014 restated (audited)

 

Adjusted profit/(loss) before tax

 

Adjusting items

Group recharges

Profit/(loss) before tax

Adjusted profit/(loss) before tax

Adjusting items

Group recharges

Profit/(loss) before tax

Adjusted profit/(loss) before tax

Adjusting items

Group recharges

Profit/(loss) before tax

 

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

 

 

 

 

 

 

 

 

 

 

 

 

 

Vicon UK

973

(30)

313

1,256

1,315

(17)

144

1,442

2,373

(8)

1,359

3,724

Vicon USA

816

-

(672)

144

979

-

(849)

130

2,607

-

(2,054)

553

Vicon Group

1,789

(30)

(359)

1,400

2,294

(17)

(705)

1,572

4,980

(8)

(695)

4,277

 

 

 

 

 

 

 

 

 

 

 

 

 

Yotta UK

(247)

(60)

(155)

(462)

(360)

(80)

(222)

(662)

56

(114)

(306)

(364)

Yotta Mayrise

744

(212)

(150)

382

652

(212)

-

440

1,487

(424)

(301)

762

Yotta Group

497

(272)

(305)

(80)

292

(292)

(222)

(222)

1,543

(538)

(607)

398

 

 

 

 

 

 

 

 

 

 

 

 

 

OMG Life UK

(1,702)

(491)

(352)

(2,545)

(2,061)

(19)

(79)

(2,159)

(4,208)

14

(402)

(4,596)

OMG Life US

(30)

(137)

-

(167)

-

-

-

-

(138)

-

-

(138)

Life Group

(1,732)

(628)

(352)

(2,712)

(2,061)

(19)

(79)

(2,159)

(4,346)

14

(402)

(4,734)

 

 

 

 

 

 

 

 

 

 

 

 

 

Unallocated

(1,217)

(88)

1,344

39

(1,089)

(106)

1,178

(17)

(2,170)

(159)

2,333

4

 

 

 

 

 

 

 

 

 

 

 

 

 

Continuing operations

 

(663)

 

(1,018)

 

328

 

(1,353)

 

(564)

 

(434)

 

172

 

(826)

 

7

 

(691)

 

629

 

(55)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

House of Moves

 

(93)

 

-

 

-

 

(93)

 

(265)

 

-

 

-

 

(265)

 

(373)

 

(616)

 

-

 

(989)

 

 

 

 

 

 

 

 

 

 

 

 

 

2d3 UK

60

(7)

(198)

(145)

223

(10)

(97)

116

241

(11)

(376)

(146)

2d3 USA

(1,005)

(127)

(130)

(1,262)

(908)

(123)

(75)

(1,106)

1,092

(233)

(253)

606

2d3 Group

(945)

(134)

(328)

(1,407)

(685)

(133)

(172)

(990)

1,333

(244)

(629)

460

 

 

 

 

 

 

 

 

 

 

 

 

 

Discontinued operations

 

(1,038)

 

(134)

 

(328)

 

(1,500)

 

(950)

 

(133)

 

(172)

 

(1,255)

 

960

 

(860)

 

(629)

 

(529)

 

 

 

 

 

 

 

 

 

 

 

 

 

OMG Group

(1,701)

(1,152)

-

(2,853)

(1,514)

(567)

-

(2,081)

967

(1,551)

-

(584)

 

 

Non-current assets

Additions to non-current assets

Carrying amount of segment assets

Carrying amount of segment liabilities

Segment depreciation and amortisation

 

Six months ended 31 March 2015 (unaudited)

Six months  ended 31 March 2014 (unaudited)

Year ended 30 September 2014   (audited)

Six months ended 31 March 2015 (unaudited)

Six months  ended 31 March 2014 (unaudited)

Year ended 30 September 2014   (audited)

Six months ended 31 March 2015 (unaudited)

Six months  ended 31 March 2014 (unaudited)

Year ended 30 September 2014   (audited)

Six months ended 31 March 2015 (unaudited)

Six months  ended 31 March 2014 (unaudited)

Year ended 30 September 2014   (audited)

Six months ended 31 March 2015 (unaudited)

Six months  ended 31 March 2014 (unaudited)

Year ended 30 September 2014   (audited)

 

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vicon UK

2,960

2,657

2,748

743

750

1,552

12,179

7,422

8,459

(2,409)

(2,094)

(2,346)

440

426

863

Vicon USA

1,190

1,182

701

8

29

43

4,211

3,843

4,321

(1,032)

(1,233)

(1,561)

13

27

45

Vicon Group

4,150

3,839

3,449

751

779

1,595

16,390

11,265

12,780

(3,441)

(3,327)

(3,907)

453

453

908

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Yotta UK

4,489

4,851

4,477

245

210

407

11,172

8,757

10,497

(1,892)

(1,887)

(1,702)

319

294

594

Yotta Mayrise

4,361

4,817

4,586

6

21

23

9,834

10,000

9,371

(1,603)

(1,667)

(1,833)

226

229

458

Yotta Group

8,850

9,668

9,063

251

231

430

21,006

18,757

19,868

(3,495)

(3,554)

(3,535)

545

523

1,052

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OMG Life UK

1,308

1,916

1,633

543

403

862

(3,915)

(152)

(2,470)

(467)

(1,104)

(777)

461

568

1,137

OMG Life USA

 

-

-

 

-

 

-

 

-

 

-

 

209

 

-

 

380

 

(1)

 

-

 

(2)

 

-

 

-

 

-

Life Group

1,308

1,916

1,633

543

403

862

(3,706)

(152)

(2,090)

(468)

(1,104)

(779)

461

568

1,137

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unallocated

504

262

303

24

16

17

(684)

128

(400)

(414)

(292)

(622)

11

9

20

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Continuing operations

 

14,812

15,685

 

14,448

 

1,569

 

1,429

 

2,904

 

33,006

 

29,998

 

30,158

 

(7,818)

 

(8,277)

 

(8,843)

 

1,470

 

1,553

 

3,117

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Yotta USA

-

-

-

-

-

-

28

25

26

(5)

(4)

(5)

-

-

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

House of Moves

 

-

845

 

-

 

-

 

19

 

26

 

-

 

1,449

 

720

 

-

 

(244)

 

(45)

 

-

 

15

 

27

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2d3 UK

-

12

11

-

-

2

297

2,131

2,353

(126)

(74)

(48)

3

2

4

2d3 USA

-

4,519

4,297

-

71

313

5,231

5,991

8,665

(1,508)

(1,238)

(2,163)

244

187

390

2d3 Group

-

4,531

4,308

-

71

315

5,528

8,122

11,018

(1,634)

(1,312)

(2,211)

247

189

394

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Discontinued operations

 

-

 

5,376

 

4,308

 

-

 

90

 

341

 

5,556

 

9,596

 

 

11,764

 

(1,639)

 

(1,560)

 

(2,261)

 

247

 

204

 

421

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OMG Group

14,812

21,061

18,756

1,569

1,519

3,245

38,562

39,594

41,922

(9,457)

(9,837)

(11,104)

1,717

1,757

3,538

 

 

3.  Reconciliation of adjusted (loss)/profit before tax

 

 

Six months ended

31 March

 2015

Six months ended

31 March

 2014 Restated

Year

 ended

30 September

2014 Restated

 

(unaudited)

(unaudited)

(audited)

 

£'000

£'000

£'000

Loss before tax - continuing operations

(1,353)

(826)

(55)

Share based payments - equity settled

112

176

166

Amortisation of intangibles arising on acquisition

258

258

516

Costs associated with termination of contract manufacturer

540

-

-

Redundancy costs

108

-

9

Reapportion Group overheads

(328)

(172)

(629)

Adjusted (loss)/profit before tax - continuing operations

(663)

(564)

7

 

 

 

 

Profit before tax - discontinued operations

(1,500)

(1,255)

(529)

Share based payments - equity settled

15

22

24

Amortisation of intangibles arising on acquisition

119

111

220

Impairment of goodwill

-

-

616

Reapportion Group overheads

328

172

629

Adjusted (loss)/profit before tax - discontinued operations

(1,038)

(950)

960

 

 

 

 

Total adjusted (loss)/profit before tax - all operations

(1,701)

(1,514)

967

 

Redundancy costs in the six months ended 31 March 2015 relate to the restructuring of the Vicon, Yotta and OMG Life businesses (year ended 30 September 2014 costs relate to the restructuring of the 2d3 UK business).

 

Costs associated with termination of contract manufacturer relate to agreements to manufacture the Autographer in volume that were not fulfilled together with settlement of supply chain commitments. The cash impact in the previous financial year except for £106,000 which impacted the first half of this financial year.

 

4.  Taxation

 

The Group's consolidated effective tax rate for the six months ended 31 March 2015 was 31.1% (for the six months ended 31 March 2014: 28.7%; for the year ended 30 September 2014: 2.4%).

 

In accordance with IAS 34 the tax charge for the half year is calculated on the basis of the estimated full year tax rate.

  

5.  Loss per share

 

The calculation of the basic earnings per share is based on the earnings attributable to ordinary shareholders divided by the weighted average number of shares in issue during the period. The calculation of diluted earnings per share is based on the basic earnings per share, adjusted to allow for the issue of shares on the assumed conversion of all dilutive options.

 

 

31 March 2015 (unaudited)

31 March 2014 restated (unaudited)

30 September 2014 restated (audited)

 

Earnings/(loss)

Weighted average number of shares

Per share amount

Earnings/(loss)

Weighted average number of shares

Per share amount

Earnings/(loss)

Weighted average number of shares

Per share amount

 

£'000

 

(pence)

£'000

 

(pence)

£'000

 

(pence)

Continuing operations

 

 

 

 

 

 

 

 

 

Basic loss per share

 

 

 

 

 

 

 

 

 

Earnings attributable to ordinary shareholders

 

(578)

 

113,357,814

 

(0.51)

(677)

109,288,622

(0.62)

(104)

111,334,397

(0.09)

Dilutive effect of employee share options

-

-

-

-

-

-

-

-

-

Diluted loss per share

(578)

113,357,814

(0.51)

(677)

109,288,622

(0.62)

(104)

111,334,397

(0.09)

Discontinued operations

 

 

 

 

 

 

 

 

 

Basic loss per share

 

 

 

 

 

 

 

 

 

Earnings attributable to ordinary shareholders

 

(1,389)

 

113,357,814

 

(1.22)

(806)

109,288,622

(0.74)

(466)

111,334,397

(0.42)

Dilutive effect of employee share options

-

-

-

-

-

-

-

-

-

Diluted loss per share

(1,389)

113,357,814

(1.22)

(806)

109,288,622

(0.74)

(466)

111,334,397

(0.42)

Total operations

 

 

 

 

 

 

 

 

 

Basic loss per share

 

 

 

 

 

 

 

 

 

Loss attributable to ordinary shareholders

 

(1,967)

 

113,357,814

 

(1.73)

(1,483)

109,288,622

(1.36)

(570)

111,334,397

(0.51)

Dilutive effect of employee share options

-

-

-

-

-

-

-

-

-

Diluted loss per share

(1,967)

113,357,814

(1.73)

(1,483)

109,288,622

(1.36)

(570)

111,334,397

(0.51)

 

 

6.  Share capital

 

 

31 March

31 March

30 September

 

2015

2014

2014

 

(unaudited)

(unaudited)

(audited)

 

£'000

£'000

£'000

Allotted, called up and fully paid

 

 

 

113,357,814 shares of 0.25p (31 March 2014: 113,357,814 shares of 0.25p and 30 September 2014: 113,357,814 shares of 0.25p)

283

283

283

 

During the six month period ended 31 March 2014 9,356,691 shares were issued in relation to the contingent consideration payable for the acquisition of Sensing Systems Inc.

There were no shares issued for cash in respect of share options exercised (six month period ended 31 March 2014: no shares).

 

7.  Dividends

 

The following dividends were recognised as distributions to equity holders in the period:

 

 

31 March

31 March

30 September

 

2015

2014

2014

 

(unaudited)

(unaudited)

(audited)

 

£'000

£'000

£'000

Final dividend for 2014 paid in 2015 - 0.50 pence per share

567

429

429

 

The final dividend for 2014 was paid to shareholders on 11 March 2015 at 0.50 pence per share, a total of £567,000.

 

8.  Copies of the interim statement

 

Copies of the interim statement will be sent to shareholders.  Further copies will be available from the Company's registered office at 14 Minns Business Park, West Way, Oxford OX2 0JB, and from the Company's website: www.omgplc.com

 


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