logo-loader
RNS
viewPelatro PLC

Half-year Report

/**/ sup{font-size:80%}p{margin-right:0cm;margin-left:0cm;font-size:12.0pt;font-family:"Times New Roman","serif";}ol{margin-bottom:0cm;}ul{margin-bottom:0cm;}link{ color: #0563C1 }visited{ color: #954F72 } .w{size:595.0pt 842.0pt;margin:72.0pt 72.0pt 72.0pt 72.0pt;}div.w{}p.eq{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-autospace:none}span.eo{font-family:"Calibri","sans-serif"}p.er{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";font-weight: bold; text-align: center}span.em{font-size:10.0pt;font-family:"Calibri","sans-serif"}p.es{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align: center}p.et{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify}span.ej{font-size:10.0pt; font-family:"Calibri","sans-serif"}p.eu{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify;line-height:14.0pt} p.ev{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";font-weight: bold; text-align: justify}span.ef{font-size:10.0pt;font-family:Symbol}span.ee{font-size: 10.0pt;font-family:"Calibri","sans-serif"}p.ew{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:36.0pt;text-align:justify;text-indent: -36.0pt;line-height:14.0pt}p.ex{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";font-weight: bold; line-height: 14.0pt; text-align: justify}p.ey{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";font-weight: bold; line-height: 14.0pt; margin-left: 36.0pt; text-align: justify; text-indent: -36.0pt}p.ez{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:36.0pt;text-align:justify;line-height: 14.0pt}p.fa{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align:justify;line-height:-116%}span.dz{font-size:10.0pt;line-height:-116%;font-family:"Calibri","sans-serif"}p.fb{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";font-div: italic; line-height: -116%; text-align: justify} p.fc{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";font-weight: bold; line-height: -116%; text-align: justify}span.dv{font-size:10.0pt;line-height:-116%;font-family:"Calibri","sans-serif"; color:windowtext}span.du{font-size:10.0pt; line-height:-116%;font-family:"Calibri","sans-serif"}table.fd{width:446.55pt;margin-left:-5.4pt;border-collapse:collapse}td.dt{width:294.0pt;padding:0cm 5.4pt 0cm 5.4pt}td.dr{width:130.95pt;padding:0cm 5.4pt 0cm 5.4pt}p.fe{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";text-align: right}p.ff{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";font-weight: bold}p.a,li.a,div.a{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";}p.fg{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";font-div: italic; line-height: 14.0pt; text-align: justify} span.do{font-size:9.0pt;font-family:"Calibri","sans-serif"}p.fh{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";font-div: italic; font-weight: bold; line-height: -116%; text-align: justify}p.fi{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";font-div: italic; font-weight: bold}p.fj{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";font-div: italic; text-align: justify}br.dj{page-break-before:always}p.fk{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";font-weight: bold; line-height: -116%}span.dh{font-size:11.0pt;line-height:-116%;font-family:"Calibri","sans-serif"}span.dg{font-size:11.0pt;font-family:"Calibri","sans-serif"}span.df{font-size:11.0pt; font-family:"Calibri","sans-serif"}table.fl{width:460.7pt;margin-left:-5.4pt;border-collapse:collapse} td.dd{width:116.65pt;padding:0cm 5.4pt 0cm 5.4pt}span.de{font-size:9.0pt; font-family:"Calibri","sans-serif"}td.dc{width:44.7pt;padding:0cm 5.4pt 0cm 5.4pt}td.db{width:44.75pt;padding:0cm 5.4pt 0cm 5.4pt}p.fm{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";line-height:14.0pt}table.fn{margin-left:-5.4pt;border-collapse:collapse}td.cy{width:279.8pt;padding:0cm 5.4pt 0cm 5.4pt}td.cw{width:70.7pt;padding:0cm 5.4pt 0cm 5.4pt}span.cx{font-size:8.0pt;font-family:"Calibri","sans-serif"}p.fo{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";font-weight: bold; text-align: right} span.ct{font-size:10.0pt;font-family: "Calibri","sans-serif"}span.cs{font-size:12.0pt;font-family:"Calibri","sans-serif"}td.cr{width:208.95pt;padding:0cm 5.4pt 0cm 5.4pt}td.cq{width:17.55pt;padding:0cm 5.4pt 0cm 5.4pt}td.cp{width:60.05pt;padding:0cm 5.4pt 0cm 5.4pt}td.co{width:60.1pt;padding:0cm 5.4pt 0cm 5.4pt}p.fp{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";font-div: italic; text-align: center}td.cm{width:60.05pt;border:none;border-bottom:solid windowtext 1.0pt; padding:0cm 5.4pt 0cm 5.4pt}td.cl{width:60.1pt;border:none;border-bottom:solid windowtext 1.0pt; padding:0cm 5.4pt 0cm 5.4pt}td.ck{width:17.55pt;border:none;border-right:solid windowtext 1.0pt; padding:0cm 5.4pt 0cm 5.4pt} td.cj{width:60.05pt;border:none;padding:0cm 5.4pt 0cm 5.4pt}td.ci{width:60.1pt;border:none;border-right:solid windowtext 1.0pt; padding:0cm 5.4pt 0cm 5.4pt}td.ch{width:60.1pt;border-top:none;border-left:none; border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt; padding:0cm 5.4pt 0cm 5.4pt}td.cg{width:60.1pt;border:none;padding:0cm 5.4pt 0cm 5.4pt}tr.cb{height:6.05pt}td.cf{width:208.95pt;padding:0cm 5.4pt 0cm 5.4pt; height:6.05pt}td.ce{width:17.55pt;padding:0cm 5.4pt 0cm 5.4pt; height:6.05pt}td.cd{width:60.05pt;padding:0cm 5.4pt 0cm 5.4pt; height:6.05pt}td.cc{width:60.1pt;padding:0cm 5.4pt 0cm 5.4pt; height:6.05pt}span.ca{font-size:8.0pt; font-family:"Calibri","sans-serif"} p.fq{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";font-div: italic; font-weight: bold; text-align: justify}span.bz{font-size: 9.0pt;font-family:"Calibri","sans-serif"}p.fr{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";font-div: italic}span.bw{font-size:9.0pt}tr.br{height:15.35pt}td.bv{width:208.95pt;padding:0cm 5.4pt 0cm 5.4pt; height:15.35pt}td.bu{width:17.55pt;padding:0cm 5.4pt 0cm 5.4pt; height:15.35pt}td.bt{width:60.05pt;padding:0cm 5.4pt 0cm 5.4pt; height:15.35pt}td.bs{width:60.1pt;padding:0cm 5.4pt 0cm 5.4pt;height:15.35pt}span.bq{font-size:14.0pt;font-family:"Calibri","sans-serif"} td.bp{width:237.3pt;padding:0cm 5.4pt 0cm 5.4pt}p.fs{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";font-div: italic; font-weight: bold; text-align: right}td.bn{width:237.3pt;padding:0cm 5.4pt 0cm 5.4pt; height:15.35pt}td.bm{width:60.1pt;padding:0cm 5.4pt 0cm 5.4pt; height:15.35pt}tr.bi{height:16.0pt}td.bl{width:237.3pt;padding:0cm 5.4pt 0cm 5.4pt; height:16.0pt}td.bk{width:60.05pt;padding:0cm 5.4pt 0cm 5.4pt; height:16.0pt}td.bj{width:60.1pt;padding:0cm 5.4pt 0cm 5.4pt; height:16.0pt}p.ft{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";font-div: italic; text-align: right}table.fu{margin-left:-1.5pt;border-collapse:collapse} tr.ba{height:41.55pt}td.bg{width:145.85pt;padding:0cm 1.5pt 0cm 1.5pt;height:41.55pt}td.bf{width:41.85pt;padding:0cm 1.5pt 0cm 1.5pt;height:41.55pt}td.bd{width:41.9pt;padding:0cm 1.5pt 0cm 1.5pt;height:41.55pt}p.fv{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-right: -1.5pt; text-align: center}td.bc{width:4.05pt;padding:0cm 1.5pt 0cm 1.5pt;height:41.55pt}td.bb{width:46.65pt;padding:0cm 1.5pt 0cm 1.5pt;height:41.55pt}tr.at{height:11.9pt}td.az{width:145.85pt;padding:0cm 1.5pt 0cm 1.5pt;height:11.9pt}td.ay{width:41.85pt;padding:0cm 1.5pt 0cm 1.5pt;height:11.9pt} td.ax{width:41.9pt;padding:0cm 1.5pt 0cm 1.5pt;height:11.9pt}td.aw{width:41.9pt;padding:0cm 1.5pt 0cm 1.5pt; height:11.9pt}td.av{width:4.05pt;padding:0cm 1.5pt 0cm 1.5pt;height:11.9pt}td.au{width:46.65pt;padding:0cm 1.5pt 0cm 1.5pt;height:11.9pt}tr.an{height:13.95pt}td.as{width:145.85pt;padding:0cm 1.5pt 0cm 1.5pt; height:13.95pt}td.ar{width:41.85pt;padding:0cm 1.5pt 0cm 1.5pt;height:13.95pt}td.aq{width:41.9pt;padding:0cm 1.5pt 0cm 1.5pt;height:13.95pt}td.ap{width:4.05pt;padding:0cm 1.5pt 0cm 1.5pt;height:13.95pt}td.ao{width:46.65pt;padding:0cm 1.5pt 0cm 1.5pt;height:13.95pt} td.am{width:41.9pt;padding:0cm 1.5pt 0cm 1.5pt; height:13.95pt}td.ak{width:364.85pt;padding:0cm 5.4pt 0cm 5.4pt}td.aj{width:223.1pt;padding:0cm 5.4pt 0cm 5.4pt}td.ai{width:286.9pt;padding:0cm 5.4pt 0cm 5.4pt}td.ah{width:67.15pt;padding:0cm 5.4pt 0cm 5.4pt}p.fw{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";margin-left:36.0pt;text-align:justify;text-indent: -36.0pt;line-height:-116%}span.ag{font-size:10.0pt;line-height:-116%; font-family:"Calibri","sans-serif"}td.ae{width:102.6pt;padding:0cm 5.4pt 0cm 5.4pt}td.ad{width:55.8pt;padding:0cm 5.4pt 0cm 5.4pt}td.ac{width:55.85pt;padding:0cm 5.4pt 0cm 5.4pt} p.fx{margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman","serif";line-height:-116%}td.aa{width:244.35pt;padding:0cm 5.4pt 0cm 5.4pt}td.z{width:53.0pt;padding:0cm 5.4pt 0cm 5.4pt}td.y{width:116.75pt;padding:0cm 5.4pt 0cm 5.4pt}td.x{width:180.6pt;padding:0cm 5.4pt 0cm 5.4pt} /**/
RNS Number : 7032N
Pelatro PLC
26 September 2019
 

 

Pelatro Plc

 

("Pelatro" or the "Group")

 

Interim results

 

 

Pelatro Plc (AIM: PTRO), the precision marketing software specialist, is pleased to announce today its interim results for the 6 months ended 30 June 2019.

 

Financial highlights

 

·              Revenue increased 14% to $2.71 million (H1 2018: $2.38m)

·              Repeat revenue increased 145% to $1.96m (H1 2018: $0.80m), 72% of revenue

·              Adjusted EBITDA* decreased 46% to $0.8m (H1 2018: $1.47m), largely due to increased expansion for growth

·              Adjusted earnings per share 0.5¢ (H1 2018: 4.4¢)

·              Gross cash as at 30 June 2019 $1.12m (at 31 December 2018: $2.22m); approximately $0.9m received from debtors since period end

·              Current revenue visibility of $6.3m, including additional revenue of $2.5m booked post period end

•              In addition to the visibility of $6.3m, the Group has a near-term pipeline of $9.2m of which $5.5m is from existing customers

 

Operational highlights

 

•              Significant investment in expanded work force and improved infrastructure to deliver best in class service and capture wider range of opportunities

·              Sales efforts in Latin America are starting to generate a healthy pipeline (currently some $3.5m)

·              Cross-selling and up-selling of Pelatro's products within customer telco groups like Telenor is progressing successfully

 

Post period end highlights

 

·              Gross cash at 31 August $1.07m

·              Trade receivables at 31 August $3.34m (H1 2019: $4.27m)

 

Outlook

 

·              Management expectations for the year underpinned by:

                - revenue visibility of $6.3m, of which $5.2m has been booked to date

- 2019 pipeline of $9.2m, of which $5.5m is from existing customers for various new modules and/or products, i.e. cross-selling opportunities where Pelatro is the only contender in most cases

 - $3.7m is from potential new customers and comprises three opportunities where we are in the final shortlist with commercial negotiations in progress

- a medium term pipeline of c.$19m (inclusive of the $9.2m near term pipeline) comprised of  over 40 live opportunities

 

 

Richard Day, Non-executive Chairman of Pelatro commented:

 

"The development in our business continues. As we win more new customers we are also expanding our product line and services while continuing to deepen our engagement and cross-sell our offering our existing customer base of global telecom groups, as shown by our contract win with the large telco in Thailand, a part of a global telco group, announced earlier this year. 

 

"Alongside this we have been confidently investing in our prime asset - our people. Already this year, we have taken on almost as many staff  as we did over the whole of last year to ensure we are well able to manage and maintain new clients, as well as ensuring all our existing clients are well served and supported across our offering.

 

"We have also increased our sales effort, with new colleagues targeting opportunities in Latin America and Africa, and I am pleased to say we are already seeing tangible benefits to our visibility of our ongoing pipeline from them for these areas.

 

"Revenue visibility currently still stands at $6.3m, as development over the traditionally quieter summer months being slightly slower than expected, resulting in a more pronounced H2 weighting this year. Despite management seeing some extended sales cycles, we have booked $5.23m of revenue to date (and $2.52m post period end); this is supported by an encouraging near term pipeline of $9.2m, a significant  proportion of which the Board is expecting to close before the year end. We are increasingly seeing opportunities to align our interests  more with those of our customers through gain share arrangements rather than one off licenses, providing us with potentially fuller returns though the life of the contract and also greater visibility over the medium and longer term as well. The Board therefore remains confident, based on current visibility and the encouraging pipeline described above, of delivering full year results in line with expectations.

 

"With our increasing spread of business we are working towards the next phase in our development, as we aim to develop more revenue sharing opportunities, as well as our licence offering. We are seeing plenty of opportunities and look forward to keeping investors informed on progress."

 

 

Presentation and analyst presentation

 

A copy of the results presentation provided to analysts will be available on Pelatro's website later today (www.pelatro.com). Management will be hosting a presentation for analysts today at 9.30am at the office of Walbrook PR, 4 Lombard Street, London, EC3V 9HD. Analysts wishing to attend the presentation should register their interest by e-mailing [email protected] or telephoning 020 7933 8780.

 

For further information contact:

 

Pelatro Plc


Subash Menon, Managing Director

c/o Walbrook

Nic Hellyer, Finance Director




finnCap Limited (Nominated Adviser and Broker)

+44 (0)20 7220 0500

Carl Holmes/Kate Bannatyne/Matthew Radley


Tim Redfern / Camille Gochez - ECM




Walbrook (Financial PR and IR)

+44 (0)20 7933 8780

Paul Cornelius/Nick Rome


 

 

* earnings before interest, tax, depreciation, amortisation,  exceptional items and share-based payments

 

 

This announcement is released by Pelatro Plc and, prior to publication, the information contained herein was deemed to constitute inside information under the Market Abuse Regulations (EU) No. 596/2014. Such information is disclosed in accordance with the Company's obligations under Article 17 of MAR. The person who arranged for the release of this announcement on behalf of Pelatro Plc was Nic Hellyer, Finance Director.

 

 

Notes to editors

 

The Pelatro Group was founded in March 2013 by Subash Menon and Sudeesh Yezhuvath with the objective of offering specialised, enterprise class software solutions for customer engagement principally to telcos who face a series of challenges including market maturity, saturation and customer churn.

 

Pelatro provides its "mViva" platform for use by customers in B2C applications, and is well positioned in the Multichannel Marketing Hub space (MMH) - this is technology that orchestrates a customer's communications and offers to customer segments across multiple channels to include websites, social media, apps, SMS, USSD and others.

 

For more information about Pelatro, visit www.pelatro.com

 



 

Managing Director's statement

 

We have been building on the foundation laid over the past few years, having won five new contracts and added four new customers in the first half of 2019. However, continuous innovation is key to sustain the growth momentum. In addition, it is essential to explore new avenues and models keeping long term challenges and prospects in mind.

 

Strategic Shift

 

Building a self-sustaining business should be the key objective of the senior management of every company. The team at Pelatro is committed to this key objective. The main pillars of such a business would be annuity business, a strong portfolio of world class products, a growing market and healthy margin. In its initial years, Pelatro focused on entering an expanding market and carving out a position for itself on the strength of its offerings and referenceable customers, while structuring a profitable business model. While ensuring the superiority of our products and maintaining profitability will be an ongoing task, the fundamentals are in place and we can now work towards the next phase of our growth. This phase is about our revenue model. Recurring and repeat revenue is an essential foundation to build the future on. It is pertinent to note here that four out of six contracts won in 2019 are for revenue share models, and several of our new opportunities too are similar in nature. This will better align revenue milestones and invoicing milestones thereby reducing Unbilled Revenue and Accounts Receivables on the one hand and provide higher visibility and stability to the business in the medium and long term.

 

Bandwidth

 

In keeping with our continuing growth led by addition of more customers, we have been expanding our teams handling sales, development, implementation and support. The total strength of the organisation at the end of the first half of 2019 stands at 145. While we added 48 people in the whole of 2018, we added 37 people in the first half of 2019, including 1 sales person, 15 in development and testing, 20 in support and implementation, and the balance in administrative functions. A further sales person was added to the team in August.

 

Acquisition Update

 

The business assets that were acquired from Danateq have been fully integrated and we are gaining significantly from the wider portfolio of customers. The expected cross-selling opportunities have been identified and are in various stages of progress. Further, the new relationships are being leveraged to extract more value from the acquisition. All these efforts will bear fruit in the years to come. As we expected at the time of the AGM update, certain contracts within the acquired pipeline have taken slightly longer to complete than originally forecast; as a result their revenue, when recognised, will not fall within the first year earn out period (the 12 months to end July 2019) but are likely to be recognised instead in the second. As a result the contingent cash payment of $2m pursuant to the terms of the acquisition is not payable in respect of the first earnout period.

 

 

Financial review

 

Revenue and profitability

 

In the six months to 30 June 2019 revenue increased by 14% over the comparable period to $2.71m (H1 2018: $2.38m). Of this, approximately $1.96m (H1 2018: $0.80m) was repeating revenue comprising gain share, change requests and other services of $1.32m and post-contract support ("PCS") of around $0.64m. The growth in repeating revenue continues to be driven by the installed customer base as well as additional demand from customers for gain share and similar contracts.

 

Underlying operating profit (excluding the impact of non-cash share-based payments, amortisation of customer-related intangible assets) was $0.20m (H1 2018: $1.23m) reflecting a period of continued investment, principally in headcount but also a much-needed increase office space as the operations have grown to deliver our growth expectations (with some $0.1m of additional lease expenses taken on in the last year). We expect H2 costs to be stable or marginally lower, partly reflecting the ending of the consultancy contract with Tele2 and the associated provision of consultants.

 

 

Net cash and trade receivables

 

Cash generated from operating activities was approximately $0.34m after working capital movements. After net financing payments of $0.15m (including approximately $88,000 relating to the reclassification of lease payments under IFRS 16) and capital expenditure of around $1.20m (including capitalised development expenditure of $1.11m) gross cash at 30 June 2019 was approximately $1.12m. Financial debt (excluding IFRS 16 liabilities) was approximately $0.43m, giving net cash of approximately $0.69m (FY 2018: $1.77m).

 

Short-term trade receivables (including unbilled revenue but excluding contract assets) as at 30 June 2019 were $4.27m compared to $3.78m at 31 December 2018 (and at 31 August were $3.34m). Of the balance outstanding at 31 December 2018, some $2.59m has been collected to date.

 

The trade receivables balance at the period end is analysed as follows:

 


H1 2019

H1 2019

H1 2019

FY 2018

FY 2018

FY 2018


$'000

$'000


$'000

$'000



Receivables

Associated revenue

"Debtor days"

Receivables

Associated revenue

"Debtor days"








Gross trade receivables

4,272

6,813

229

3,778

6,019

229

Trade receivables excluding UBR

1,453

5,622

94

1,453

3,694

144

 

Trade receivables above exclude contract assets and the associated revenue is the relevant contractual revenue excluding any adjustment for IFRS 15. Given the wide variety and bespoke nature of the Group's contracts, figures shown for debtor days are illustrative only. Unbilled Revenue ("UBR") of $1.58m (H1 2018: $1.38m) arises principally from contractual revenue milestones being reached earlier than invoicing milestones.

 

 

Implementation of IFRS 16

 

Pelatro has adopted IFRS 16 Leases for the financial year ending 31 December 2019 and has chosen  to  use  the  modified retrospective approach  to  adoption  which  means  there  are  no restatements to the prior year figures. IFRS 16 introduces a single lessee accounting model, whereby the Group will recognise lease liabilities and "right of use" assets at 1 January 2019 for leases previously classified as operating leases. Within the income statement rental expense is replaced by depreciation and interest expense. The adoption of IFRS 16 has resulted in aggregate right of use assets of $420,000 with corresponding liabilities of $484,000 being recognised as at 30 June 2019

 

In order to allow users of the accounts to see how the impact of IFRS 16  has affected adjusted EBITDA, we present a reconciliation below:

 


Adjusted EBITDA

Adjusted EBITDA


6 months to

30 June 2019

6 months to

30 June 2018


$'000

$'000

Consistent with 2018 presentation and accounting policy

682

1,474

Changes due to IFRS 16

111

-


_______

_______

Consistent with 2019 presentation and accounting policy

793

1,474

 

 

Expenditure on non-current assets

 

Expenditure on non-current assets of $1.20m (2018: $1.07m) comprises principally capitalised development costs of $1.1m plus minor expenditure on third party software and licenses, plus  expenditure on tangible assets of $78,000. Capitalisation of intangibles as a percentage of the underlying costs in the Group's software development operation was approximately 55% (H1 2018: 68%). The capitalisation of development costs has resulted in an intangible asset in the statement of financial position of $3.87m (net of amortisation; H1 2018: $1.45m).

 

Share option scheme

 

The Company established a share option plan on 14 January 2019 in order to align the longer-term interests of senior employees with those of shareholders and incentivise the creation of shareholder value. The initial award of options was for a total of 1,640,000 Ordinary Shares at an exercise price of 73p per share (representing approximately 5 per cent. of the Company's issued share capital). The Options are exercisable, subject to the grantee remaining in employment with a member of the Pelatro Group, over 4 years and their exercise on vesting is not dependent upon any performance criteria.

 

 

Current trading and outlook

 

Revenue visibility is a key element of our business - the longer the visibility, the greater the stability and predictability. Revenue visibility is currently $6.3m and despite not having full visibility on 2019 revenue at this stage, the near term sales pipeline gives the Board confidence in the outturn for the year. This healthy sales pipeline is a crucial aspect of our business and we are currently tracking more than 40 opportunities across a range of products worth over $19m in aggregate from existing and potential customers. Of this, some $9.2m represents a broad spread of some 20+ pipeline opportunities that are being actively managed and that could close before the year end including some of significant size; of this $9.2m, some $5.5m is from existing customers. Given the size and quality of this pipeline we remain confident in the outturn for the year and of achieving market expectations.



 

Group statement of comprehensive income



6 months to

30 June 2019

6 months to

30 June 2018

Year to

December 2018


Note

$'000

$'000

$'000



(unaudited)

(unaudited)

(audited)

Revenue

2

2,714

2,376

6,123

Cost of sales and provision of services


(634)

(361)

(555)



_______

_______

_______

Gross profit


2,080

2,015

5,568






Administrative expenses


(1,879)

(781)

(2,421)



_______

_______

_______

Adjusted operating profit


201

1,234

3,147

Exceptional items

3

-

-

(310)

Amortisation of acquisition-related intangibles

3

(349)

-

(286)

Share-based payments

3

(49)

-

-



_______

_______

_______

Operating profit


(197)

1,234

2,551

Finance income

4

20

9

33

Finance expense

5

(85)

(37)

(71)



_______

_______

_______

Profit/(loss) before taxation


(262)

1,206

2,513

Income tax credit/(expense)


4

(145)

(334)



_______

_______

_______

PROFIT/(LOSS) FOR THE PERIOD ATTRIBUTABLE TO OWNERS OF THE PARENT


(258)

1,061

2,179






Other comprehensive income/(expense):





Items that may be reclassified subsequently to profit or loss:





Exchange differences


1

(60)

78



_______

_______

_______

Other comprehensive income, net of tax


(1)

(60)

78






TOTAL COMPREHENSIVE INCOME FOR THE PERIOD


(257)

1,001

2,257






Earnings per share





Reported





Attributable to the owners of the parent (basic and diluted)

6

(0.8)¢

4.4¢

8.0¢






Adjusted





Basic

6

0.5¢

4.4¢

10.1¢

Diluted

6

0.5¢

4.4¢

10.1¢

 



 

Group statement of financial position



As at

30 June 2019

As at

30 June 2018

As at 31 December 2018


Note

$'000

$'000

$'000



(unaudited)

(unaudited)

(audited)

Assets





Non-current assets





Intangible assets

7

10,648

1,865

10,609

Property, plant and equipment


408

302

362

Right-of-use assets

8

420

-

-

Trade and other receivables


306

414

360

Contract assets


117

127

303



_______

_______

_______



11,899

2,708

11,634






Current assets





Trade receivables

9

4,272

2,263

3,778

Contract assets


304

516

81

Other assets


425

356

382

Cash and cash equivalents

                       

1,118

2,096

2,224



_______

_______

_______



6,119

5,231

6,465






Total assets


18,018

7,939

18,099






Liabilities





Non-current liabilities





Borrowings

10

359

420

382

Lease liabilities

11

260

-

-

Contract liabilities


202

-

67

Other financial liabilities

13

1,187

-

1,141



_______

_______

_______



2,008

420

1,590






Current liabilities





Trade and other payables

12

356

362

609

Borrowings

10

73

69

69

Lease liabilities

11

224

-

-

Contract liabilities and deferred revenue


257

106

171

Other financial liabilities

13

-

-

298



_______

_______

_______



910

537

1,147






Total liabilities


2,918

957

2,737






NET ASSETS


15,100

6,982

15,362






Issued share capital and reserves





Share capital


1,065

801

1,065

Share premium


11,603

4,472

11,603

Other reserves


(668)

(587)

(721)

Retained earnings


3,100

2,296

3,415



_______

_______

_______

TOTAL EQUITY


15,100

6,982

15,362

 



 

Group statement of cash flows


6 months to

30 June 2019

6 months to

30 June 2018

Year to

December 2018


$'000

$'000

$'000


(unaudited)

(unaudited)

(audited)

Cash flows from operating activities




Profit/(loss) for the period

(258)

1,061

2,179

Adjustments for:




Income tax expense recognised in profit or loss

(8)

145

342

Interest income

(20)

(4)

(33)

Finance costs

85

37

71

Depreciation of tangible non-current assets

132

20

46

Amortisation of intangible non-current assets

809

220

843

Provision for/(benefit of) deferred taxes

4

-

(8)

Share-based payments

49

-

-

Foreign exchange (gains)/losses

(6)

18

(69)


_______

_______

_______

Operating cash flows before movements in working capital

787

1,497

3,371

(Increase)/decrease in trade and other receivables

(402)

(1,022)

(2,438)

(Increase)/decrease in contract assets

(38)

(505)

(273)

Increase/(decrease) in trade and other payables

(230)

(9)

57

Increase in contract liabilities and other deferred income

220

(13)

146


_______

_______

_______

Cash generated from operating activities

337

(52)

863





Income tax paid

(96)

(263)

(292)


_______

_______

_______

Net cash generated from operating activities

241

(315)

571





Cash flows from investing activities




Acquisition of property, plant and equipment

(78)

(305)

(384)

Development of intangible assets

(1,111)

(763)

(1,604)

Acquisition of intangible assets

(12)

-

(69)

Cash (out)/inflow on acquisition of subsidiaries net of cash acquired

-

(14)

(7,035)


_______

_______

_______

Net cash used in investing activities

(1,201)

(1,082)

(9,092)





Cash flows from financing activities




Proceeds from issue of ordinary shares, net of issue costs

-

-

7,395

Repayments to related parties

-

(407)

(436)

Proceeds from borrowings

276

254

394

Repayment of borrowings

(300)

(339)

(513)

Repayments of principal on lease liabilities

(88)

-

-

Interest income

20

4

33

Finance costs

(40)

(37)

(62)

Less interest accrued but not paid

1

1

3

Interest expense on lease liabilities

(22)

 

-

-


_______

_______

_______

Net cash generated by/(used in) financing activities

(153)

(524)

6,814





Net increase/(decrease) in cash and cash equivalents

(1,113)

(1,921)

(1,707)

Net foreign exchange differences

7

(109)

(195)

Cash and equivalent at beginning of period

2,224

4,126

4,126


_______

_______

_______

Cash and cash equivalents at end of period

1,118

2,096

2,224





 

 

 

Group statement of changes in equity


Share capital

Share premium

Exchange reserve

Merger reserve

Share-based payments reserve

Retained profits


Total


$'000

$'000

$'000

$'000

$'000

$'000


$'000

Balance at 31 December 2017 as previously reported

801

4,472

(2)

(527)

-

1,217


5,961

Effect of change of accounting policy (IFRS 15)

-

-

-

-

-

18


18


_____

_____

_____

_____

_____

_____


_____

Balance at 31 December 2017 as restated

801

4,472

(2)

(527)

-

1,235


5,979

Profit after taxation for the period

-

-

-

-

-

1,061


1,061

Other comprehensive income:









Exchange differences on translation of overseas subsidiaries

-

-

(58)

-

-

-


(58)


_____

_____

_____

_____

_____

_____


_____

Balance at 30 June 2018

801

4,472

(60)

(527)

-

2,296


6,982

Profit after taxation for the period

-

-

-

-

-

1,118


1,118

Other comprehensive income:









Exchange differences

-

-

(133)

-

-



(133)

Transactions with owners:









Shares issued by Pelatro Plc for cash

264

7,450

-

-

-

-


7,714

Issue costs

-

(319)






(319)


_____

_____

_____

_____

_____

_____


_____

Balance at 31 December 2018

1,065

11,603

(193)

(527)

-

3,414


15,362

Effect of change of accounting policy (IFRS 16)

-

-

-

-

-

(57)


(57)


_____

_____

_____

_____

_____

_____


_____

Balance at 31 December 2018 as restated

1,065

11,603

(193)

(527)

-

3,357


15,305

Profit/(loss) after taxation for the period

-

-

-

-

-

(258)


(258)

Share-based payments

-

-

-

-

49

-


49

Other comprehensive income:









Exchange differences

-

-

4

-

-

-


4

Transactions with owners:










_____

_____

_____

_____

_____

_____


_____

Balance at 30 June 2019

1,065

11,603

(189)

(527)

49

3,099


15,100

 



Notes to the Group financial statements

 

 

1              Basis of preparation

 

The Group has prepared its interim financial statements for the 6 months ended 30 June 2019 (the "interim results") in accordance with the recognition and measurement principles of International Financial Reporting Standards ("IFRS") as adopted by the European Union and also in accordance with the recognition and measurement principles of IFRS issued by the International Accounting Standards Board, but do not include all the disclosures that would otherwise be required. They have been prepared under the historical cost convention as modified to include the revaluation of certain non-current assets. Other than the adoption of IFRS 16 Leases the accounting policies adopted in the interim financial statements are consistent with those adopted in the Group's Annual Report and Financial Statements for the year ended 31 December 2018 and those which will be adopted in the preparation of the annual report for the year ending 31 December 2019.

 

As permitted, the interim results have been prepared in accordance with the AIM Rules of the London Stock Exchange and not in accordance with IAS34 Interim Financial Reporting. They do not constitute full statutory accounts within the meaning of section 434 of the Companies Act 2006 and are unaudited.

 

 

Change in accounting policy  - application of IFRS 16 Leases

 

(a) General

 

In the current period the Group has applied IFRS 16 Leases (as issued by the IASB in January 2016) for the first time ("IFRS 16" or the "Standard"). IFRS 16 introduces new or amended requirements with respect to lease accounting, resulting in significant changes to lessee accounting by removing the distinction between operating and finance leases and requiring the recognition of a right-of-use asset and a lease liability at the lease commencement for all leases, except for short-term leases and leases of low value assets.

 

The Group has applied the definition of a lease and related guidance set out in the Standard to all lease contracts entered into or modified on or after 1 January 2014, with the date of initial application as 1 January 2019. The Group has applied IFRS 16 using the modified retrospective approach, with no restatement of comparative information.

 

(b) Former operating leases

 

IFRS 16 changes how the Group accounts for leases previously classified as operating leases under IAS 17, which were off balance sheet. Applying IFRS 16, for all leases (except as noted below), the Group:

 

(i) recognises right-of-use assets and lease liabilities in the consolidated statement of financial position, initially measured at the present value of future lease payments;

 

(ii) recognises depreciation of right-of-use assets, and interest on lease liabilities, in the consolidated statement of comprehensive income; and

 

(iii) separates the total amount of cash paid in respect of lease obligations into a principal portion and interest (both presented within financing activities) in the consolidated statement of cash flows.

 

Lease payments under (i) are discounted using the interest rate implicit in the lease, if that rate can be determined, or the Group's estimated incremental borrowing rate. The finance cost is charged to the Consolidated Statement of Comprehensive Income over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. The right-of-use asset is depreciated over the shorter of the asset's useful life and the lease term on a straight-line basis.  Additionally under IFRS 16, right-of-use assets are tested for impairment in accordance with IAS 36 Impairment of Assets. This replaces the previous requirement to recognise a provision for onerous lease contracts. For the leases taken on balance sheet at 30 June 2019 the Group has used a weighted average interest rate of 9.4%.

 

For short-term leases (lease term of 12 months or less) and leases of low-value assets the Group has opted to recognise a lease expense on a straight-line basis as permitted by the Standard. This expense is presented within other expenses in the consolidated statement of profit or loss.

 

(c) Financial effect of initial application of IFRS 16

 

The tables below show the amount of adjustment for each financial statement line item affected by the application of IFRS 16 for the current period. As the Group has adopted the modified retrospective approach the prior year and period are not restated and hence there is no effect shown.

 

Impact on profit/(loss) for the period


6 months to

30 June 2019


$'000


(unaudited)



Increase in depreciation

94

Increase in finance costs

22

Loss on foreign currency translation

2

Decrease in other expenses

(111)


_______

Increase in profit for the period

7

 

 

Impact on earnings per share for the period

 

The impact on earnings per share is too small to be reflected in disclosure to the nearest 0.1c

 

 

Impact on assets, liabilities and equity as at 1 January 2019


As previously reported

IFRS 16 adjustments

As restated


$'000

$'000

$'000


(audited)

(unaudited)

(unaudited)

Right-of-use assets

-

383

383


_______

_______

_______

Net impact on total assets

-

383

383









Lease liabilities

-

(440)

(440)


___________

_______

_______

Net impact on total liabilities

-

(440)

(440)





Retained earnings

-

57

57


_______

_______

_______

Net impact on total liabilities and equity

-

383

383

 

 

The recognised right-of-use assets relate to the following types of assets:


As at

30 June 2019

As at

1 January 2019


$'000

$'000


(unaudited)

(unaudited)

Leasehold properties

401

383

Motor vehicles

19

-


_______

_______

Total right-of-use assets

420

383

 

The associated right-of-use assets for property leases were measured on a retrospective basis as if the new rules had always been applied. There were no onerous lease contracts that would have required an adjustment to the right-of-use assets at the date of initial application.

 

Impact on consolidated statement of cash flows

 

The application of IFRS 16 has an impact on the consolidated statement of cash flows of the Group as under the Standard lessees must present:

 

•              Short-term lease payments, payments for leases of low-value assets and variable lease payments not included in the measurement of the lease liability as part of operating activities (such payments have no material effect on these financial statements);

 

•              Cash paid for the interest portion of lease liabilities as part of financing activities; and

 

•              Cash payments for the repayment of the principal portions of leases liabilities as part of financing activities.

 

Under IAS 17, all lease payments on operating leases were presented as part of cash flows from operating activities. Consequently, for the 6 months ended 30 June 2019, the net cash generated by operating activities has increased by $111,000 and net cash used in financing activities increased by the same amount.

 

Extension and termination options

 

Extension and termination options are included in a number of property leases across the Group. These terms are used to maximise operational flexibility in terms of managing contracts. All of the extension and termination options held are exercisable only by the Group and not by the respective lessor. In determining the lease term, management considers all facts and circumstances that create an economic incentive to exercise an extension option, or not exercise a termination option. Extension options (or periods after termination options) are only included in the lease term if the lease is reasonably certain to be extended (or not terminated).

 

 

Share-based payments

 

The Group has applied the requirements of IFRS 2 Share-based payments in respect of options granted under the share option plan for senior employees dated 15 January 2019  (the "Plan"). Under the terms of the Plan,  the Group is able to make equity-settled share-based payments to certain employees and Directors by way of issue of options over ordinary shares. Such equity-settled share-based payments are measured at fair value at the date of grant. This fair value is determined as at the grant date of the options and is expensed on a straight-line basis over the vesting period, based on the Group's estimate of the number of options that will eventually vest. Fair value is measured by use of a Black-Scholes model; the expected life value used in the model has been adjusted, based on management's best estimates, for the effects of non-transferability, exercise restrictions and behavioural considerations.

 

 

IFRIC 23 Uncertainty over Income Tax Treatments

 

IFRIC 23 is effective for periods beginning on or after 1 January 2019 and requires:

 

•              The Group to determine whether uncertain tax treatments should be considered separately, or together as a group, based on which approach provides better predictions of the resolution;

 

•              The Group to consider if it is probable that the tax authorities will accept the uncertain tax treatment; and

 

•              If it is not probable that the uncertain tax treatment will be accepted, measure the tax uncertainty based on the most likely amount or expected value, depending on whichever method better predicts the resolution of the uncertainty

 

The Group does not believe that it is impacted by IFRIC 23 and therefore opening retained earnings remain unaffected.

 

 

Going concern

 

The Directors have considered trading and cash flow forecasts prepared for the Group, and based on these, and confirmed banking facilities, are satisfied that the Group will continue to be able to meet its liabilities as they fall due for at least one year from the date of these results.  On this basis, they consider it appropriate to have adopted the going concern basis in the preparation of the interim results, which were approved by the Board of Directors on 25 September 2019.

 

 

Comparative financial information

 

The comparative financial information presented herein for the year ended 31 December 2018 does not constitute full statutory accounts for that period. Statutory accounts for the year ended 31 December 2018 have been filed with the Registrar of Companies.  These statutory accounts carried an unqualified Auditor's Report, did not draw attention to any matters by way of emphasis and did not contain a statement under Section 498(2) or 498(3) of the Companies Act 2006.

 

 

2              Segmental analysis

 

Revenue by geography

 

The Group recognises revenue in seven geographical regions based on the location of customers, as set out in the following table:


6 months to

30 June 2019

6 months to

30 June 2018

Year to

December 2018


$'000

$'000

$'000


(unaudited)

(unaudited)

(audited)





Caribbean

243

189

357

Central Asia

206

987

1,653

Eastern Europe

56

-

380

North Africa

95

288

314

South Asia

1,088

542

819

South East Asia

561

-

2,207

Sub-Saharan Africa

465

370

393


_______

_______

_______


2,714

2,376

6,123

 

Management makes no allocation of costs, assets or liabilities between these region since all trading activities are operated as a single business unit.

 

Revenue by type


6 months to

30 June

6 months to

30 June

Year to  31 December


2019

2018

2018


$'000

$'000

$'000


(unaudited)

(unaudited)

(audited)





Repeat software sales and services

1,316

575

2,288

Maintenance and support

645

228

809


_______

_______

_______

Total repeat revenues

1,961

803

3,097

Software - new licenses

498

1,568

2,511

Consulting

250

-

515

Resale of hardware

5

5

-


_______

_______

_______


2,714

2,376

6,123

 

 

An analysis of revenue by status of invoicing is as follows:


6 months to

30 June

6 months to

30 June

Year to 31 December


2019

2018

2018


$'000

$'000

$'000


(unaudited)

(unaudited)

(audited)





(i) Revenue invoiced to customers under contractual terms

 

1,076

488

3,694

(ii) Revenue due under terms of contract but unbilled at period end ("UBR")

 

1,582

1,376

2,325

(iii) Revenue recognised other than (ii) (i.e. on the completion of performance obligations but before any billing milestone is reached)

 

90

512

271

Less: net revenue deferred (under IFRS 15 or otherwise)

(20)

-

(80)

Less: revenue recognised or to be recognised as interest under IFRS 15

(14)

-

(87)


_______

_______

_______





Total revenue recognised in the period

2,714

2,376

6,123

 

 

A broad analysis of Unbilled Revenue is as follows:


6 months to

30 June 2019


$'000


(unaudited)



Gain share contracts awaiting administrative process

203

Other contracts awaiting administrative process

38

Annual contractual payment date not yet reached

181

Invoicing milestone not yet reached

1,160


_______

UBR

1,582

 

 

3              Non-GAAP profit measures and exceptional items

 

Reconciliation of operating profit to earnings before interest, taxation, depreciation and amortisation ("EBITDA"):


6 months to

30 June 2019

6 months to

30 June 2018

Year to

December 2018


$'000

$'000

$'000


(unaudited)

(unaudited)

(audited)

Operating profit/(loss)

(197)

1,234

2,551

Adjusted for:




Amortisation and depreciation

940

240

889

Exceptional items:




 - acquisition expenses

-

-

310

Share-based payments

49

-

-


_______

_______

_______

Adjusted EBITDA

792

1,474

3,750

 

The  criterion  for  adjusting  items  in  the  calculation  of  adjusted  EBITDA is  operating  income  or expenses  that  are  material  and  either (i) arise  from  an  irregular  and significant event or  (ii) are such that the  income/cost  is recognised in a pattern that is unrelated to the resulting operational performance. Materiality is defined as an  amount  which,  to  a  user,  would  influence decision-making based on,  and  understandability  of,  the  financial statements.  Adjustment for share-based payment expense is made because, once  the  cost  has  been  calculated,  the  Directors  cannot  influence  the  share  based  payment charge  incurred  in  subsequent  years, and  the  value  of  the  share  option  to  the  employee  differs considerably in value and timing from the actual cash cost to the Group.

 

Exceptional items are treated as exceptional by reason of their size or nature and are excluded from the calculation of adjusted EBITDA (and adjusted earnings per ordinary share) to allow a better understanding of comparable year-on-year trading and thereby an assessment of the underlying trends in the Group's financial performance. These measures also provide consistency with the Group's internal management reporting. Exceptional items in 2018 comprise legal and other costs relating to the Danateq Acquisition.

 

Share-based payments

 

Share-based payment expense comprises the charge in the current period relating to the expensing of the fair value of (a) the 1,640,000 options granted under the share option plan for senior employees dated 15 January 2019 (the "Plan") and (b) 74,000 options issued at the time of the Company's IPO. The options issued under the terms of the Plan were granted with an exercise price of 73p, vesting in tranches as follows: 25% after one year, 25% after two years and 50% after three years. There are no conditions attaching to the vesting of the options other than continued employment.

 

Adjusted EPS

 

The calculation of adjusted EPS is shown in Note 5.

 

 

4              Finance income


6 months to

30 June 2019

6 months to

30 June 2018

Year to

December 2018


$'000

$'000

$'000


(unaudited)

(unaudited)

(audited)

Interest receivable on interest-bearing deposits

6

9

10

Notional interest accruing on contracts with a significant financing component

14

-

23


_______

_______

_______

Total finance income

20

9

33

 

 

5              Finance expense


6 months to

30 June 2019

6 months to

30 June 2018

Year to

December 2018


$'000

$'000

$'000


(unaudited)

(unaudited)

(audited)





Interest and finance charges paid or payable on borrowings

40

37

62

Acquisition-related financing expense - unwinding of discount on financial liabilities

23

-

9

Interest on lease liabilities under IFRS 16

22

-

-


_______

_______

_______

Total finance expense

85

37

71

 

 

6              Earnings per share

 

Earnings per share - reported ("EPS")

 

The calculation of the basic and diluted EPS is based on the following data:

 


6 months to

30 June 2019

6 months to

30 June 2018

Year to

December 2018


$'000

$'000

$'000


(unaudited)

(unaudited)

(audited)

Earnings




Earnings for the purposes of basic and diluted earnings per share being net profit attributable to equity holders of the parent

(258)

1,061

2,179





Number of shares




Weighted average number of ordinary shares for the purposes of basic and diluted earnings per share

32,532,431

24,313,252

27,375,741

 

The weighted average number of shares and the loss for the year for the purposes of calculating the fully diluted earnings per share are the same as for the basic loss per share calculation. This is because the outstanding share options would have the effect of reducing the loss per ordinary share and would therefore not be dilutive under IAS33.

 

 

Adjusted earnings per share

 

Adjusted EPS is calculated as follows:


6 months to

30 June 2019

6 months to

30 June 2018

Year to

December 2018


$'000

$'000

$'000


(unaudited)

(unaudited)

(audited)





Earnings attributable to owners of the Parent

(258)

1,061

2,179

Adjusting items:




 - exceptional items (note 3)

-

-

310

- amortisation of acquisition-related intangibles

349

-

286

- share-based payments

49

-

-

Finance charge on liabilities relating to contingent consideration

23


9


_______

_______

_______

Adjusted earnings attributable to owners of the Parent

163

1,061

2,784





Adjusted earnings per share attributable to shareholders (basic)

0.5¢

4.4¢

10.1¢





Weighted number of ordinary shares in issue

32,532,431

24,313,252

27,375,741

Effect of dilutive potential ordinary shares:




 - in-the-money share options

6,702

n/a

n/a


________



Weighted average number of ordinary shares for the purposes of diluted earnings per share

32,539,133

n/a

n/a





Adjusted earnings per share attributable to shareholders (diluted)

0.5¢

4.4¢

10.1¢

 

The Group has one category of potentially dilutive ordinary share, being those share options granted to employees where the exercise price (plus the remaining expected charge to profit under IFRS 2) is less than the average price of the Company's ordinary shares during the period. The weighted average number of shares for the calculation of diluted earnings per share is computed using the treasury share method.

 

 

7              Intangible assets

 

Intangible assets comprise capitalised development costs, acquired software, customer relationships and goodwill.

 


Development costs

Third party

software

Customer relationships

Goodwill

Total


$'000

$'000

$'000

$'000

$'000

Cost






At 1 January 2019

4,144

98

6,862

745

11,849

Additions

1,111

12

-

-

1,123

Fair value adjustment

-

-

-

(275)

(275)


_______

_______

_______

_______

_______

At 30 June 2019

5,255

110

6,862

470

12,697







Amortisation or impairment






At 1 January 2019

(935)

(19)

(286)

-

(1,240)

Charge for the period

(450)

(10)

(349)

-

(809)


_______

_______

_______

_______

_______

At 30 June 2019

(1,385)

(29)

(635)

-

(2,049)







Net carrying amount






At 30 June 2019

3,870

81

6,227

470

10,648







At 1 January 2019

3,209

79

6,576

745

10,609

 

 

Comparative figures for the prior period are as follows:

 


Development costs

Third party

software

Customer relationships

Goodwill

Total


$'000

$'000

$'000

$'000

$'000

Cost






At 1 January 2018

1,290

32

-

287

1,609

Additions

763

-

-

-

763

Fair value adjustment

-

-


113

113

Effect of foreign exchange movements

-

(2)

-

-

(2)


_______

_______

_______

_______

_______

At 30 June 2018

2,053

30

-

400

2,483







Amortisation or impairment






At 1 January 2018

(382)

(16)

-

-

(398)

Charge for the period

(219)

(1)

-

-

(220)

Effect of foreign exchange movements

-

-

-

-

-


_______

_______

_______

_______

_______

At 30 June 2018

(601)

(17)

-

-

(618)







Net carrying amount






At 30 June 2018

1,452

13

-

400

1,865

 

The Company and the Danateq Group entered into a sale and purchase agreement ("SPA") on 30 July 2018 to acquire certain assets of Danateq Pte and Danateq Limited. Further consideration for the Danateq Acquisition of up to $5,000,000 was contingent on the achievement of certain revenue targets in the two years following the acquisition. Following the completion of the measurement period at 31 December 2018 the contingent consideration liability for payments potentially due in the period 2019 to 2020 was valued at $1.44m (as discounted to the then present value at an imputed cost of funds). At 30 June 2019 the value of this liability was revised downwards to $1.19m million, a $0.25m decrease (net of the unwinding of the present value discount). This reduction reflected revised expectations of sales from the acquired pipeline (particularly those for the first earn out period to 31 July 2019) based on the performance in the 6 month period and updated business projections. Accordingly a contingent liability of $275,000 has been adjusted (to nil) and a corresponding decrease has been made to goodwill. The carrying value of this liability will continue to be reassessed at future reporting dates.

 

 

8              Right-of-use assets

 

Right-of-use assets comprise leases over office buildings and vehicles


Office

buildings

Vehicles

Total


$'000

$'000

$'000

Cost




At 1 January 2019

-

-

-

Effect of change of accounting policy (IFRS 16)

603

-

603

Additions in the period

94

25

119

Effects of foreign exchange movements

17

(1)

16


_______

_______

_______

At 30 June 2019

714

24

738





Depreciation




At 1 January 2019

-

-

-

Effect of change of accounting policy

(219)

-

(219)

Charge for the period

(89)

(5)

(94)

Effects of foreign exchange movements

5

-

5


_______

_______

_______

At 30 June 2019

(313)

(5)

(318)





Net carrying amount




At 30 June 2019

401

19

420

At 1 January 2019

-

-

-

 

 

9              Trade and other receivables

 

Trade receivables

 

Trade receivables (due in less than one year) amounted to $4.27 million (at 31 December 2018: $3.78m), net of a provision of £nil (as at 31 December 2018: £nil) for impairment. Trade receivables analysed by age were as follows:


Carrying amount

Neither impaired or past due

Past due but not impaired




61-90 days

91-120 days

More than 121 days


$'000

$'000

$'000

$'000

$'000

As at 30 June 2019






Trade receivables

4,272

2,820

145

84

1,223


           





As at 30 June 2018






Trade receivables

2,263

1,838

-

-

425







As at 31 December 2018






Trade receivables

3,778

3,636

-

-

142

 

In addition to the above, $306,000 (FY 2018: $360,000) is included in trade receivables payable in more than one year.

 

 

10           Loans and borrowings


As at

30 June 2019

As at

30 June 2018

As at 31 December 2018


$'000

$'000

$'000


(unaudited)

(unaudited)

(audited)

Non-current liabilities




Secured term loans

359

420

382


_______

_______

_______


359

420

382

Current liabilities




Current portion of term loans

73

69

69


_______

_______

_______


73

69

69





Total loans and borrowings

432

489

451

 

 

11           Lease liabilities

 

Lease liabilities comprise liabilities arising from the committed and expected payments on leases over office buildings and vehicles .


Office

equipment

Vehicles

Total


$'000

$'000

$'000

At 1 January 2019

-

-

-

Effect of change of accounting policy

440

-

440

Leases taken on in the period

94

25

119

Repayments of principal

(83)

(5)

(88)

Effects of foreign exchange movements

14

(1)

13


_______

_______

_______

At 30 June 2019

465

19

484

 

 

12           Trade and other payables


As at

30 June 2019

As at

30 June 2018

As at 31 December 2018


$'000

$'000

$'000


(unaudited)

(unaudited)

(audited)

Due within a year




Trade payables

12

63

118

Other payables

344

256

463

Amounts due to related parties

-

43

28


_______

_______

_______

Total trade and other payables

356

362

609

 

Other payables principally comprise provisions for taxation liabilities and other costs.

 

Contract liabilities represent liabilities resulting from balance sheet reclassifications arising from the application of IFRS 15.

 

 

13           Other financial liabilities

 

Other financial liabilities comprise the fair value of potential liabilities for the contingent payments due in respect of the Danateq acquisition.


As at

30 June 2019

As at

30 June 2018

As at 31 December 2018


$'000

$'000

$'000


(unaudited)

(unaudited)

(audited)

Contingent consideration on the acquisition of Danateq assets




- potentially due within one year

-

-

298

- potentially due after one year

1,187

-

1,141


_______

_______

_______

Total other financial liabilities

1,187

-

1,439

 

 

14           Post balance sheet events

 

There  have  been  no  events  subsequent  to  the  reporting  date  which  would  have  a  material impact on these interim financial results

 

 

 [END]


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.
 
END
 
 
IR KMGZLRKMGLZM

Quick facts: Pelatro PLC

Price: 60

Market: AIM
Market Cap: £19.52 m
Follow

Create your account: sign up and get ahead on news and events

NO INVESTMENT ADVICE

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...

FOR OUR FULL DISCLAIMER CLICK HERE