RNS Number:2753B
Bede PLC
01 August 2007
Press Release 1 August 2007
Bede plc
("Bede" or "the Company")
Second Quarter Results
Bede plc today announces its Second Quarter Results for the three months ended
30 June 2007.
Chairman's Statement and Chief Executive's Review
Trading Results
The Company is pleased to announce that second quarter order bookings came in
close to plan at #1.7m (Q1 2007: #1.1m; Q2 2006; #2.1m).
Turnover for the quarter was #0.5m (Q1 2007: #1.4m; Q2 2006 #0.5m) and gross
margin was 20% (Q1 2007: 51%; Q2 2006 19%).
In addition to sales for the first half of #1.9m (H1 2006: #1.5m), the Company
ends the second quarter with an order book of #3.6m (30 June 2006: #2.6m).
Net operating charges for the quarter were #1.3m (Q1 2007: #1.6m before
restructuring costs; Q2 2006 #1.6m) and reflect the result of actions taken
earlier in the year to reduce the cost base.
Q2 pre tax losses before amortisation were #1.0m (Q2 2006: #1.3m), unchanged
from Q1 2007 but on a lower sales number.
Commentary
The Company is very pleased to have appointed Hugh Rudden in the quarter to the
position of Chief Executive Officer and the Board has asked him to conduct a
full strategic review of Company opportunities. Corporate objectives have been
reviewed and continued customer penetration, product development and marketing,
reducing production cycle times and ongoing margin improvement programs remain
key focus areas for the business.
You will also note from the announcement dated 13 July that the review process
has incorporated preliminary discussions with certain parties, the outcome of
which may or may not lead to an offer being made for the Company.
In the quest to expand market share the Company is pleased to report that it has
won its first order from a foundry customer. The foundry segment will play an
increasing role in providing advanced technology products to those integrated
device manufacturers who are outsourcing their advanced wafer manufacturing
needs.
R&D spend for the quarter was maintained at the required level. In July, the
Company commenced discussion with target customers for its new High Throughput
Production Platform. By virtue of high throughput rates, this tool will be used
in our customers' production lines and will also address a number of new
applications not previously covered by Bede.
Current trading and outlook
The Group starts the third quarter with a healthy opening order book of #3.6m (1
July 2006: #2.6m) and the required working capital in place to deliver this.
The current order book will ship in the coming months to meet customer request
dates and the Company will see significant sales growth in the second half of
2007.
As ever, we are grateful for the ongoing support of customers, shareholders and
employees and look forward to reporting progress in future announcements.
Stuart McIntosh Hugh Rudden
Chairman Chief Executive Officer
31 July 2007 31 July 2007
For further information please contact:
Bede plc
David Hall, Finance Director Tel: +44 (0) 191 332 4700
david.hall@bede.co.uk www.bede.com
Media enquiries:
Abchurch
Sarah Hollins / Emma Johnson Tel: +44 (0) 20 7398 7784
emma.johnson@abchurch-group.com www.abchurch-group.com
CONSOLIDATED INCOME STATEMENT
FOR THE PERIOD ENDED 30 JUNE 2007
Quarter Quarter 6 Months 6 Months Year
Ended Ended Ended Ended Ended
30-Jun 30-Jun 30-Jun 30-Jun 31-Dec
2007 2006 2007 2006 2006
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Note #000 #000 #000 #000 #000
Revenue 2 520 453 1,899 1,506 5,960
Cost of sales (416) (368) (1,094) (1,011) (3,634)
Gross profit 104 85 805 495 2,326
Other operating 102 88 143 100 327
income
Other operating (1,436) (1,715) (3,323) (3,730) (7,200)
charges
Operating loss before (1,230) (1,542) (2,375) (3,135) (4,547)
financing costs
Financial income 25 27 45 75 100
Financial expenses (18) (17) (36) (39) (59)
Net financing income 7 10 9 36 41
Loss before tax (1,223) (1,532) (2,366) (3,099) (4,506)
Income tax 100 399 220 499 699
Loss for the period (1,123) (1,133) (2,146) (2,600) (3,807)
Attributable to :
Equity holders of the (1,123) (1,133) (2,146) (2,600) (3,807)
parent
Loss for the period (1,123) (1,133) (2,146) (2,600) (3,807)
Basic loss per share
(pence) 7 (1.3p) (1.3p) (2.5p) (3.0p) (4.4p)
Diluted loss per
share (pence) 7 (1.3p) (1.3p) (2.5p) (3.0p) (4.4p)
CONSOLIDATED BALANCE SHEET
AS AT 30 JUNE 2007
As at As at As at
30-Jun 30-Jun 31-Dec
2007 2006 2006
(Unaudited) (Unaudited)
Note #000 #000 #000
Assets
Property, plant and equipment 1,945 2,211 2,058
Intangible assets 3 3,479 3,586 3,365
Total non-current assets 5,424 5,797 5,423
Inventories 3,910 5,157 3,741
Income tax receivable 200 200 400
Trade and other receivables 4 1,559 1,426 2,586
Cash and cash equivalents 5 509 1,713 938
Total current assets 6,178 8,496 7,665
Total assets 11,602 14,293 13,088
Equity
Issued capital 6 1,746 1,746 1,746
Share premium 6 30,720 30,720 30,720
Reserves 6 1,546 1,198 1,391
Retained earnings 6 (24,075) (20,722) (21,929)
Total equity attributable to
equity holders of the parent 9,937 12,942 11,928
Total equity 9,937 12,942 11,928
Liabilities
Trade and other payables 8 1,469 1,269 1,095
Deferred government grants - 7 -
Deferred income 196 75 65
Total current liabilities 1,665 1,351 1,160
Total liabilities 1,665 1,351 1,160
Total equity and liabilities 11,602 14,293 13,088
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 30 JUNE 2007
Quarter Quarter 6 Months 6 Months Year
Ended Ended Ended Ended Ended
30-Jun 30-Jun 30-Jun 30-Jun 31-Dec
2007 2006 2007 2006 2006
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Note #000 #000 #000 #000 #000
Cash flows from operating
activities
Loss for the period (1,123) (1,133) (2,146) (2,600) (3,807)
Adjustments for :
Depreciation 63 76 126 163 319
Amortisation 189 218 378 423 902
(Increase) / decrease in
inventories (336) 74 (169) 180 1,596
Decrease / (increase) in
trade and other receivables 951 185 1,027 866 (295)
(Decrease) / increase in trade
and other payables (101) (218) 374 (448) (622)
(Decrease) in deferred
government grants - (3) - (7) (14)
(Decrease) / increase in
deferred income (46) 65 131 67 57
Foreign exchange movements 70 (69) 78 (85) 163
Equity-settled
share-based payments 35 89 77 178 122
Income tax credit (100) (399) (220) (499) (699)
Cash generated from the
operations (398) (1,115) (344) (1,762) (2,278)
Income taxes received - 699 420 699 699
Net cash from operating
activities (398) (416) 76 (1,063) (1,579)
Cash flows from investing
activities
Acquisition of plant and
equipment (10) (1) (13) (1) (2)
Development expenditure (241) (138) (492) (521) (779)
Net cash from investing
activities (251) (139) (505) (522) (781)
Net (decrease) in cash and
cash equivalents in the period (649) (555) (429) (1,585) (2,360)
Cash and cash equivalents
at start of period 1,158 2268 938 3,298 3,298
Cash and cash equivalents
at end of period 5 509 1,713 509 1,713 938
CONSOLIDATED STATEMENT OF RECOGNISED INCOME AND EXPENSE
FOR THE PERIOD ENDED 30 JUNE 2007
Quarter Quarter 6 Months 6 Months Year
Ended Ended Ended Ended Ended
30-Jun 30-Jun 30-Jun 30-Jun 31-Dec
2007 2006 2007 2006 2006
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Note #000 #000 #000 #000 #000
Foreign exchange
translation differences 6 70 (68) 78 (83) 166
Net expenses recognised
directly in equity 70 (68) 78 (83) 166
Loss for the period 6 (1,123) (1,133) (2,146) (2,600) (3,807)
Total recognised income
and expense (1,053) (1,201) (2,068) (2,683) (3,641)
Attributable to:
Equity shareholders of
the parent (1,053) (1,201) (2,068) (2,683) (3,641)
NOTES TO THE FINANCIAL INFORMATION
1. Basis of accounting
The financial information for the period ended 30 June 2007 is unaudited and has
been prepared in accordance with the accounting policies detailed in the Group's
published consolidated financial statements for the year ended 31 December 2006.
The comparative figures for the financial year ended 31 December 2006 are not
the company's statutory accounts for that financial year. Those accounts have
been reported on by the company's auditors and have been delivered to the
registrar of companies. The report of the auditors was (i) unqualified, (ii) did
not contain a statement under section 237(2) or (3) of the Companies Act 1985,
and (iii) included a reference to a matter to which the auditors drew attention
by way of emphasis without qualifying their report. The matter to which the
auditors drew attention was the disclosures contained in note 2 to the financial
statements regarding the group's ability to continue as a going concern.
The Group operates in the global semiconductor market which is subject to rapid
advances in technology. It mitigates the risk of operating in this market by
maintaining an appropriate level of research and development spend to help it to
continue to develop products that are attractive to its customers. It saw
improvements in its order bookings in 2006 and recognises the importance of this
continuing in 2007. The Group continues to seek and develop opportunities at all
semiconductor companies.
The Group meets its day to day working capital requirements through cash
reserves and overdraft facilities. The nature of the Group's product means that
orders tend to be for significant amounts. This fact, combined with the market
in which it operates, means there can be unpredictable variation in the timing
of cash inflows.
On the basis of projected cash flow information, the Board considers that the
Group will continue to operate with sufficient cash. However, given the inherent
risk of forecasting revenues within this market, there can be no certainty in
relation to these matters. The financial information does not include any
adjustments that would result from the basis of preparation being inappropriate.
2. Segment reporting
Segment information is presented in respect of the Group's geographical and
business segments. The primary format, geographical segments, is based on the
geographical location of customers.
Quarter Quarter 6 Months 6 Months Year
Ended Ended Ended Ended Ended
30-Jun 30-Jun 30-Jun 30-Jun 31-Dec
2007 2006 2007 2006 2006
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
#000 #000 #000 #000 #000
United Kingdom 33 3 45 13 31
Europe 138 50 201 136 474
Asia 194 27 757 117 1,689
United States 155 373 894 1,240 3,761
Rest of World - - 2 - 5
520 453 1,899 1,506 5,960
3. Intangible assets
Goodwill Patents and Development Total
trademarks costs
#000 #000 #000 #000
Cost
Balance at 1 January 2006 1,191 26 4,246 5,463
Acquisitions - internally generated - - 521 521
Balance at 30 June 2006 1,191 26 4,767 5,984
Balance at 1 July 2006 1,191 26 4,767 5,984
Acquisitions - internally generated - - 258 258
Balance at 31 December 2006 1,191 26 5,025 6,242
Balance at 1 January 2007 1,191 26 5,025 6,242
Acquisitions - internally generated - - 492 492
Balance at 30 June 2007 1,191 26 5,517 6,734
Amortisation and impairment losses
Balance at 1 January 2006 - 20 1,955 1,975
Amortisation for period - 4 419 423
Balance at 30 June 2006 - 24 2,374 2,398
Balance at 1 July 2006 - 24 2,374 2,398
Amortisation for period - - 479 479
Balance at 31 December 2006 - 24 2,853 2,877
Balance at 1 January 2007 - 24 2,853 2,877
Amortisation for period - - 378 378
Balance at 30 June 2007 - 24 3,231 3,255
Carrying amounts
At 1 January 2006 1,191 6 2,291 3,488
At 30 June 2006 1,191 2 2,393 3,586
At 31 December 2006 1,191 2 2,172 3,365
At 30 June 2007 1,191 2 2,286 3,479
Amortisation charge
The amortisation charge is recognised in the "other operating charges" line item in the income
statement.
4. Trade and other receivables
As at As at As at
30-Jun 30-Jun 31-Dec
2007 2006 2006
(Unaudited) (Unaudited)
#000 #000 #000
Trade receivables 318 319 1,604
Amounts owed in respect of
Employee Benefit Trusts 752 752 752
Other debtors 143 103 125
Prepayments and accrued income 346 252 105
1,559 1,426 2,586
5. Cash and cash equivalents
As at As at As at
30-Jun 30-Jun 31-Dec
2007 2006 2006
(Unaudited) (Unaudited)
#000 #000 #000
Bank balances 506 1,709 934
Petty cash 3 4 4
Cash and cash equivalents
in the statement of cash flows 509 1,713 938
6. Capital and reserves
Reconciliation of movement in capital and reserves
Share Share IFRS 2 Translation Other Retained Total
Capital Premium reserve reserve reserve earnings Equity
#000 #000 #000 #000 #000 #000 #000
Balance at 1 January 2006 1,746 30,720 584 (81) 600 (18,122) 15,447
Total recognised income
and expense - - - (83) - (2,600) (2,683)
Equity settled transactions - - 178 - - - 178
Balance at 30 June 2006 1,746 30,720 762 (164) 600 (20,722) 12,942
Balance at 1 January 2006 1,746 30,720 584 (81) 600 (18,122) 15,447
Total recognised income
and expense - - - 166 - (3,807) (3,641)
Equity settled transactions - - 122 - - - 122
Balance at 31 December 2006 1,746 30,720 706 85 600 (21,929) 11,928
Balance at 1 January 2007 1,746 30,720 706 85 600 (21,929) 11,928
Total recognised income
and expense - - - 78 - (2,146) (2,068)
Equity settled transactions - - 77 - - - 77
Balance at 30 June 2007 1,746 30,720 783 163 600 (24,075) 9,937
Translation reserve
The translation reserve comprises all foreign exchange differences arising from the
translation of the financial information of foreign operations.
Other reserve
Other reserve arose on the Group reconstruction of Bede plc and Bede Scientific Instruments Limited in
the year ended 31 December 2000, accounted for under the merger method of accounting. The reserve
comprises the balance on the share premium account of Bede Scientific Instruments Limited as at the
date of the merger, net of the premium on preference shares redeemed on flotation.
7. Loss per share
Quarter Quarter 6 Months 6 Months
Ended Ended Ended Ended Year Ended
30-Jun 30-Jun 30-Jun 30-Jun 31-Dec
2007 2006 2007 2006 2006
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Loss attributable
to ordinary shareholders
Loss for the period (#000) (1,123) (1,133) (2,146) (2,600) (3,807)
Weighted average number of
ordinary shares
Issued ordinary shares at
start of period (000) 87,293 87,293 87,293 87,293 87,293
Effect of shares issued
in the period (000) - - - - -
Weighted average number of ordinary
shares at end of period (000) 87,293 87,293 87,293 87,293 87,293
Loss per share (pence) (1.3) (1.3) (2.5) (3.0) (4.4)
Weighted average number of
ordinary shares
(diluted)
Weighted average number of ordinary
shares at period end (000) 87,293 87,293 87,293 87,293 87,293
Effect of share options in issue - - - - -
Weighted average number of ordinary
shares (diluted) at period end 87,293 87,293 87,293 87,293 87,293
(000)
Loss per share (diluted) (pence) (1.3) (1.3) (2.5) (3.0) (4.4)
Share options in issue during the period do not have dilutive impact on the loss per share calculation.
8. Trade and other payables
As at As at As at
30-Jun 30-Jun 31-Dec
2007 2006 2006
(Unaudited) (Unaudited)
#000 #000 #000
Trade payables 907 792 593
Other taxation and social security 225 112 213
Other creditors 60 86 68
Accruals 277 279 221
1,469 1,269 1,095
Independent review report to Bede plc
Introduction
We have been instructed by the company to review the financial information for
the six months ended 30 June 2007 which comprises the consolidated income
statement, consolidated balance sheet, consolidated statement of cash flows,
consolidated statement of recognised income and expense and related notes. We
have read the other information contained in the interim report and considered
whether it contains any apparent misstatements or material inconsistencies with
the financial information.
This report is made solely to the company in accordance with the terms of our
engagement to assist the company in meeting the requirements of the Listing
Rules of the Financial Services Authority. Our review has been undertaken so
that we might state to the company those matters we are required to state to it
in this report and for no other purpose. To the fullest extent permitted by
law, we do not accept or assume responsibility to anyone other than the company
for our review work, for this report, or for the conclusions we have reached.
Directors' responsibilities
The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by, the directors. The directors
are responsible for preparing the interim report in accordance with the Listing
Rules of the Financial Services Authority which require that the accounting
policies and presentation applied to the interim figures should be consistent
with those applied in preparing the preceding annual accounts except where any
changes, and the reasons for them, are disclosed.
Review work performed
We conducted our review in accordance with guidance contained in Bulletin 1999/
4: Review of interim financial information issued by the Auditing Practices
Board for use in the UK. A review consists principally of making enquiries of
group management and applying analytical procedures to the financial information
and underlying financial data and, based thereon, assessing whether the
accounting policies and presentation have been consistently applied unless
otherwise disclosed. A review excludes audit procedures such as tests of
controls and verification of assets, liabilities and transactions. It is
substantially less in scope than an audit performed in accordance with
International Standards on Auditing (UK and Ireland) and therefore provides a
lower level of assurance than an audit. Accordingly, we do not express an audit
opinion on the financial information.
Review conclusion
On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the six months
ended 30 June 2007.
Emphasis of matter - going concern
In forming our review conclusion on the financial information for the six months
ended 30 June 2007, we have considered the adequacy of the disclosures made in
note 1 concerning the Group's ability to continue as a going concern. The Group
incurred a net loss of #2.1m during the six months ended 30 June 2007. This
condition, along with other matters explained in note 1 to the financial
information, indicate the existence of a material uncertainty which may cast
significant doubt on the Group's ability to continue as a going concern. The
financial information does not include the adjustments that would result if the
Group were unable to continue as a going concern.
KPMG Audit Plc Quayside House
Chartered Accountants 110 Quayside
31 July 2007 Newcastle Upon Tyne
NE1 3DX
This information is provided by RNS
The company news service from the London Stock Exchange
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