TIDMMDW
RNS Number : 0673G
Mediwatch PLC
03 June 2013
3 June 2013
Mediwatch plc
Interim Results for the six months to 30 April 2013
Mediwatch plc ("Mediwatch", "the Company" or "the Group", AIM:
MDW), the innovative urological diagnostic company, is pleased to
publish its interim results for the six months ended 30 April
2013.
Financial Highlights
-- Sales revenues of GBP4,911,000 (H1 2012: GBP5,084,000)
-- Gross Margin increases by GBP35,000 despite lower sales
-- Operating Profit of GBP161,000 (H1 2012 GBP78,000)
-- EBITDA of GBP311,000 (H1 2012: GBP245,000)
-- Profit before Taxation up 210% at GBP121,000 (H1 2012: GBP39,000)
Operational Highlights
-- Successful launch of New Clinic+ Urodynamics system, NANO
Portable UDX system, Mediwatch Procedure Couch and Venus Pelvic
Floor device, which were well received at the European Association
of Urology annual conference and exhibition in Milan in April and
the American Urological Association annual conference and
exhibition in San Diego in May
-- Restructuring of UK sales to deliver the same effectiveness with lower cost
-- New distribution contracts signed in the USA
-- Strong sales growth of capital goods in the USA
-- New Distributors signed in Latin America
-- PSAwatch is continuing positively with potential for large scale work-place screening
-- Successful ISO 13485:2003 and CMDCAS renewal
-- Regulatory approvals in China and Latin America are in progress
Omer Karim, Mediwatch Chairman commented
"The Board is encouraged with the results for the first half of
the 2013 financial year; in particular it is pleasing to see that
the cost reductions have firmly benefited the bottom line. With new
product launches well underway and more to come later in the year;
the Group is positioned for a positive second half"
Enquiries
Mediwatch plc
Tel: +44 (0)1788 547 888
Dr Philip Stimpson, Chief Executive / Mark Hughes, Chief
Financial Officer
SP Angel Corporate Finance LLP
Nomad and broker
Tel: +44 (0)20 3463 2260
Ewan Leggat / Laura Littley
Editors Notes: Mediwatch plc: Innovative Diagnostic
Solutions
Mediwatch is a leader in its field. The Company is continually
striving to develop and market faster, simpler and less invasive
diagnostic products to save lives and restore quality of life for
people with a variety of urological conditions. Founded in 1995,
Mediwatch (www.mediwatch.com) has developed a range of medical
equipment for the diagnosis of urological disorders.
The business focuses its design skills towards diagnostic
products that can be used across the medical profession.
Overview
Whilst overall sales have been flat compared to last year the
cost reductions made both in product cost of sales leading to
higher gross margin as well as in lower selling and administration
expenses has resulted in a profit before tax increase of 210% over
the 2012 half year.
Mediwatch's vision for the future is to develop affordable
equipment for the treatment of conditions in its targeted clinical
areas. The new product launches planned for 2013 have started well.
The first of these a new urodynamic range of Clinic and Encompass,
the new Nano, a new procedure couch and the tablet Portaflow were
well received at European Association of Urology meeting in Milan
in April and the American Urologists Association annual conference
and exhibition in San Diego in May. There is more to come later in
the year.
Trading
In the six month period to 30 April 2013, Group turnover was
GBP4.9 million, (H1 2012: GBP5.1 million). The Group has seen the
continuing effects of the US economy emerging from the global
slowdown ahead of other markets with the US business showing good
growth in revenues and it now accounts for some 55% (51% H2 2012)
of Group revenues. Revenue in the UK (which services Europe and the
Rest of the world) has declined and, following the failed attempt
to partner with Genesis in an attempt to improve these sales, the
UK sales team has been restructured to reduce cost with minimal
impact on the team's effectiveness and the UK profitability has
been enhanced. The product mix experienced during the first half of
the 2013 financial year was also similar to that experienced in the
first half of 2012.
The Group achieved an EBITDA of GBP311,000 for the six months to
30 April 2013 (H1 2012: GBP245,000). Profit is very slightly ahead
of the Board's expectations at this stage.
Cash flow was down due to increasing working capital requirement
in the USA from the increasing sales. Additional debt funding has
also been taken on in the UK to support the Research and
Development effort.
UK, Europe and ROW Operations
Highlights from the UK operations include:
-- On budget performance in profit despite lower sales
-- PSAwatch continues to gain momentum
-- Restructuring of UK sales to deliver the same effectiveness with lower cost
-- Successful ISO 13485:2003 and CMDCAS renewal
US Operations
Highlights from the US operations include:
-- Strong sales growth, 13% increase on the first half of 2012
-- Gross Margin percentage higher than last year
-- Savings on selling and administration expenses over 2012
-- New distribution contracts signed
-- Strong sales growth of capital goods
-- New Distributor agreements signed in Latin America and Canada
Research and Development
Expenditure on research and development, including capitalised
costs, was GBP263,000 (H1 2012: GBP363,000) during the six months
to 30 April 2013. The main spend being on:
-- Development of a new cart system
-- Upgrade of product software to latest standards
-- Producing the products which were launched at the European
Association of Urology annual conference and exhibition in Milan in
April and the American Urologists Association annual conference and
exhibition in San Diego in May
Management and employees
The Board would like to take this opportunity to again thank all
employees for their hard work and contribution in achieving the
continuing success of the business.
Current trading and outlook
The Group is currently trading just above management's budgets
and we expect to meet market expectations for the year.
Consolidated Income Statement
for the six months ended 30 April 2013
Unaudited Unaudited Audited
6 months 6 months 12 months
30 April 30 April 31 October
2013 2012 2012
-------------------------------------- ---------- ---------- -----------
GBP000s GBP000s GBP000s
Revenue 4,911 5,084 10,091
Cost of sales (2,895) (3,103) (6,136)
---------- ---------- -----------
Gross profit 2,016 1,981 3,955
Administrative expenses (1,930) (1,926) (3,876)
Other income 75 73 163
Exceptional items - (50) (88)
---------- ---------- -----------
Profit from operating activities 161 78 154
Net finance expenses (40) (39) (63)
---------- ---------- -----------
Profit before taxation 121 39 91
Taxation - - (11)
---------- ---------- -----------
Profit for the period attributable
to the
equity shareholders 121 39 80
---------- ---------- -----------
Earnings per share (p)
- basic and diluted 0.09p 0.03p 0.06p
All of the activities of the Group are classified
as continuing.
Consolidated Statement of Comprehensive Income
for the six months ended 30 April 2013
Unaudited Unaudited Audited
30 April 30 April 31 October
2013 2012 2012
------------------------------------------------- ---------- ----------- -----------
GBP000s GBP000s GBP000s
Profit for the year 121 39 80
Other comprehensive income
Exchange differences on translating
foreign operations 3 (7) (48)
Total comprehensive income for
the period 124 32 32
---------- ----------- -----------
Consolidated Balance Sheet
at 30 April 2013
Unaudited
Unaudited Restated Audited
30 April 30 April 31 October
2013 2012 2012
------------------------------- ---------------- ---------- -----------
GBP000s GBP000s GBP000s
Non-current assets
Property, plant and equipment 355 413 380
Goodwill 2,256 2,256 2,256
Intangible assets 3,203 2,744 3,015
---------------- ---------- -----------
Total non-current assets 5,814 5,413 5,651
Current assets
Inventories 1,638 1,482 1,682
Trade and other receivables 1,885 1,878 1,642
Cash and cash equivalents 193 177 163
---------------- ---------- -----------
Total current assets 3,716 3,537 3,487
---------------- ---------- -----------
Total assets 9,530 8,950 9,138
---------------- ---------- -----------
Current liabilities
Borrowings 1,223 1,006 1,045
Trade and other payables 1,772 1,974 1,907
---------------- ---------- -----------
Total current liabilities 2,995 2,980 2,952
Non-current liabilities
Borrowings 441 - 216
Total non-current liabilities 441 - 216
---------------- ---------- -----------
Total liabilities 3,436 2,980 3,168
---------------- ---------- -----------
Net assets 6,094 5,970 5,970
---------------- ---------- -----------
Capital and reserves
Share capital 3,842 3,842 3,842
Share premium 6,095 6,095 6,095
Other reserves 7,000 7,000 7,000
Share based payment reserve 1 1 1
Retained earnings (10,844) (10,968) (10,968)
---------------- ---------- -----------
Shareholders' funds 6,094 5,970 5,970
---------------- ---------- -----------
Consolidated statement of changes in equity
For the six months ended 30 April 2013
Share Share Other Retained Total
capital premium reserves earnings equity
---------------------------- -------- -------- --------- --------- --------
GBP000s GBP000s GBP000s GBP000s GBP000s
At start of period 3,842 6,095 7,001 (10,968) 5,970
Profit for the period - - - 121 121
Other comprehensive income
for the period - - - 3 3
-------- -------- --------- --------- --------
At end of period 3,842 6,095 7,001 (10,844) 6,094
-------- -------- --------- --------- --------
For the six months ended 30 April 2012
Share Share Other Retained Total
capital premium reserves earnings equity
---------------------------- -------- -------- --------- --------- --------
GBP000s GBP000s GBP000s GBP000s GBP000s
At start of period 3,842 6,095 7,001 (11,000) 5,938
Profit for the period - - - 39 39
Other comprehensive income
for the period - - - (7) (7)
-------- -------- --------- --------- --------
At end of period 3,842 6,095 7,001 (10,968) 5,970
-------- -------- --------- --------- --------
For the twelve months ended 31 October 2012
Share Share Other Retained Total
capital premium reserves earnings equity
---------------------------- -------- -------- --------- --------- --------
GBP000s GBP000s GBP000s GBP000s GBP000s
At start of period 3,842 6,095 7,001 (11,000) 5,938
Profit for the period - - - 80 80
Other comprehensive income
for the period - - - (48) (48)
-------- -------- --------- --------- --------
At end of period 3,842 6,095 7,001 (10,968) 5,970
-------- -------- --------- --------- --------
Consolidated Statement of cash flows
for the six months ended 30 April 2013
Unaudited Unaudited Audited
6 Months 6 Months 12 Months
30 April 30 April 31 October
2013 2012 2012
---------------------------------------- ---------------------- -------------- ---------------
GBP000s GBP000s GBP000s
Cashflow from operating activities
Profit for the period 161 78 154
Adjustments for:
Depreciation 75 87 164
Amortisation of intangible assets 75 75 150
Loss on disposal of property,
plant and equipment 2 - 52
Income tax expense - - (11)
Interest expense (40) (39) (63)
---------------------- -------------- ---------------
273 201 446
---------------------- -------------- ---------------
Changes in inventories 44 (192) (391)
Changes in trade and other receivables (243) 366 602
Changes in trade and other payables (135) (212) (279)
---------------------- -------------- ---------------
(334) (38) (68)
---------------------- -------------- ---------------
Net cash movement from operating
activities (61) 163 378
Cash flow from investing activities
Proceeds from sales of property,
plant and equipment - 3 -
Purchase of property, plant &
equipment (52) - (90)
Purchase of intangible fixed assets (263) (363) (710)
---------------------- -------------- ---------------
Net cash movement used in investing
activities (315) (360) (800)
Cash flow from financing activities
Repayment of borrowings (45) (41) -
New Loans 350 - 87
---------------------- -------------- ---------------
Net cash from financing activities 305 (41) 87
Decrease in cash and cash
equivalents in the period (71) (238) (335)
Opening cash and cash equivalents (803) (419) (419)
Currency exchange difference 3 (5) (49)
---------------------- -------------- ---------------
Closing cash and cash equivalents (871) (662) (803)
---------------------- -------------- ---------------
Analysed as follows:
Cash and cash equivalents 193 177 163
Borrowings (1,223) (1,006) (1,045)
Less: Loans included in Borrowings 159 167 79
---------------------- -------------- ---------------
(871) (662) (803)
---------------------- -------------- ---------------
1. BASIS OF PREPARATION OF INTERIM REPORT
As permitted, IAS 34, 'Interim Financial Reporting' has not been
applied in this interim report.
The financial information presented in this report has been
prepared using accounting policies that will be used in the
preparation of the financial statements for the year ending 31
October 2013.
These policies are in accordance with the recognition and
measurement principles of International Financial Reporting
Standards (IFRS) issued by the International Accounting Standards
Board as endorsed for use in the European Union, and these
principles are disclosed in the Financial Statements for the year
ended 31 October 2012.
The financial information in this interim report does not
constitute statutory accounts within the meaning of Section 435 of
the Companies Act 2006.
The statutory accounts of Mediwatch plc for the year ended 31
October 2012 have been reported on by the Company's auditors and
have been delivered to the Registrar of Companies. The auditor's
report was unqualified, did not include a reference to matters
which the auditors drew attention by way of emphasis without
qualifying their report and did not contain statements under
Section 498(2) or 498(3) of the Companies Act 2006.
The 2012 half year comparatives have been restated to take into
accounts a prior year adjustment reducing inventory by GBP116,000
explained in Note 17 of the Group's 2012 account. There has also
been a review of the various cash accounts which has led to an
improved reclassification between Cash and Borrowings.
2. SEGMENTAL ANALYSIS
A geographical analysis of the Group's turnover by destination
is as follows:
Six months Six months Twelve months
ended ended ended
30 April 30 April 31 October
2013 2012 2012
GBP000s GBP000s GBP000s
United Kingdom 707 881 1,497
United States
of America 2,697 2,385 4,953
Europe 846 1,116 2,120
Rest of the
world 661 702 1,521
------------- ------------- ----------------
Total 4,911 5,084 10,091
============= ============= ================
The turnover, profit on ordinary activities and net assets of
the Group are attributable to one business segment, the supply of
primary care products used in the diagnosis of urological disorders
and early prostate cancer detection.
3. EARNINGS PER SHARE
The calculation of earnings per share for the six months ended
30 April 2013 is based on the profit attributable to equity
shareholders of GBP121,000 (for the six months ended 30 April 2012:
GBP39,000 and for the 12 months to 31 October 2012: GBP80,000)
divided by the weighted average number of shares in issue during
the period which was 140,871,032 (140,871,032 for both comparative
periods).
4. PRESS RELEASE
Copies of this report will not be issued to shareholders but
will be available for download from www.mediwatch.com. If you would
like to receive a hard copy of the interim report please contact
the Mediwatch offices on +44 (0)1788 547 888 to request a copy.
This information is provided by RNS
The company news service from the London Stock Exchange
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