Half-yearly report
CENTROM GROUP plc
Unaudited interim results for the six months ended 30 June 2008
Centrom Group plc (AIM:CET), a supplier of a broad range of
innovative IT solutions with an emphasis on sales to the healthcare
and financial services sectors, announces its interim results for the
six months ended 30 June 2008.
For further information please contact:
Gerald Malone, Chairman 07711 085611
Mike Boseley, CEO 01252 365000
Geoff Nash/Rose Herbert 020 7600 1658
FinnCap (Nominated adviser and joint broker)
John Webb 020 7490 3788
Marshall Securities Limited (Joint broker)
CENTROM GROUP plc
Interim results for the six months ended 30 June 2008 - Unaudited
Chairman & CEO Report
We present the interim results for the six months ended 30 June 2008.
Turnover in the period has been disappointing, weakening from
�1,832,725 to �1,319,519, mostly due to late starting contracts and
in part to the slow roll out of the NHS National Programme for
Information Technology, significant for Centrom's healthcare
business.
Gross margins across the business for the period were 29% (2007: 36%)
reflecting lower utilisation rates and business mix. Administrative
costs remained under tight control - �536,537 compared with �585,843
in the same period last year. The loss before tax for the period was
�174,618 (2007: profit �73,270). The board regularly reviews the
scope for additional cost cutting, but is mindful of the need to
maintain sufficient skills and resource to deliver a quality service
to Centrom's customer base and secure new business.
Whilst working capital remains limited, the Company continues to
operate within its existing bank facilities and is maintaining a
tight control over costs.
Projects and Prospects
An Open Source practice has been established. Traction is now being
achieved in the local government sector, with new contracts secured
at Bristol and Hertfordshire.
A new product has been completed for Canon Europe to provide
additional functionality to their multi function devices. This is
being launched during the second half of 2008.
Centrom's data centre consulting business is now working with a
number of clients to establish services from diverse data centres
within the UK. This allows us to advise on the establishment of
infrastructure and, on some projects, the refurbishment of existing
facilities, which can significantly enhance the contract value. This
has been made possible through a new partnership with a specialist
data centre design and build group, EPI.
The board is conscious of the difficulties facing small scale
companies in the IT sector and those facing the AIM market and is
actively seeking ways to deliver value for shareholders.
Gerald Malone Mike
Boseley
Chairman CEO
29 September 2008
CENTROM GROUP plc
Group Income Statement
for the six months
ended 30 June 2008
Unaudited Unaudited
6 months 6 months Year ended
ended 30 ended 30 31 December
Notes June 2008 June 2007 2007
� � �
Revenue 5 1,319,519 1,832,725 3,533,540
Cost of sales (936,618) (1,163,388) (2,210,367)
Gross profit 382,901 669,337 1,323,173
.
Administrative costs (536,537) (585,843) (1,126,946)
Operating (loss)/profit
before impairment (153,636) 83,494 196,227
Impairment of
development expenditure 4 - - (529,123)
Operating (loss)/profit (153,636) 83,494 (332,896)
Finance revenue - - 55
Finance costs (20,982) (10,224) (26,018)
(Loss)/profit from
continuing operations (174,618) 73,270 (358,859)
UK income tax
credit/(expense) (9,438) (22,000) 12,811
(Loss)/profit for the
period (184,056) 51,270 (346,048)
Minority interests - - -
(Loss)/profit for the
period attributable to (184,056) 51,270 (346,048)
members of the parent
company
(Loss)/profit per share 6
Basic (pence) (0.08) 0.02 (0.16)
Diluted (pence) (0.08) 0.02 (0.16)
The results for the period are
derived from continuing
operations
The Group has no recognised gains or losses
other than the results for the period/year.
Accordingly no Statement of Recognised
Income and Expenditure has been prepared.
CENTROM GROUP plc
Group Balance Sheet
as at 30 June 2008
Unaudited Unaudited 31 December
30 June 2008 30 June 2007 2007
� � �
Assets
Non-current assets
Goodwill and intangible
assets 7,243,895 7,750,287 7,230,312
Property plant and
equipment 65,600 88,524 70,567
Deferred tax asset 344,926 349,053 139,579
7,654,421 8,187,864 7,440,458
Current assets
Trade and other
receivables 523,919 608,484 1,025,390
Deferred tax asset 38,938 - 244,285
Cash and cash equivalents 2,895 3,348 3,216
565,752 611,832 1,272,891
Total assets 8,220,173 8,799,696 8,713,349
Equity and liabilities
Equity attributable to
equity holders of the
parent
Share capital 2,145,334 2,087,834 2,145,334
Share premium 6,462,415 6,462,415 6,462,415
Retained earnings (2,004,531) (1,423,157) (1,820,475)
6,603,218 7,127,092 6,787,274
Minority interest 141,179 141,179 141,179
Total equity 6,744,397 7,268,271 6,928,453
Liabilities
Non-current liabilities
Long-term borrowings 53,451 69,667 62,054
Current liabilities
Short-term provisions 166,233 107,987 133,858
Trade and other payables 651,092 728,475 791,571
Current portion of long
term borrowings 22,000 22,000 22,000
Bank overdrafts 53,070 51,679 89,870
Current tax payable - 64,699 52,493
Deferred income 529,930 486,918 633,050
1,422,325 1,461,758 1,722,842
Total liabilities 1,475,776 1,531,425 1,784,896
Total equity and
liabilities 8,220,173 8,799,696 8,713,349
CENTROM GROUP plc
Group Cash Flow Statement
for the six months ended 30
June 2008
Unaudited Unaudited
6 months 6 months Year ended
ended 30 ended 30 31 December
June 2008 June 2007 2007
� � �
Cash flows from operating
activities
(Loss)/profit from operations (153,636) 83,494 (332,896)
Impairment of development
expenditure - - 529,123
Depreciation of plant and
equipment 23,283 39,116 70,492
Operating cash flows before
movement in working capital (130,353) 122,610 266,719
Decrease/(increase) in
receivables 501,471 427,883 10,977
Increase/(decrease) in payables (176,224) (481,151) (238,258)
Cash generated/(utilised) by
operating activities 194,894 69,342 39,438
Interest paid (20,982) (10,224) (26,018)
Tax paid (61,931) - -
Net cash generated/(utilised)
by operating activities 111,981 59,118 13,420
Cash flows from investing
activities
Interest received - - 55
Payments to acquire property,
plant and equipment (17,329) (9,020) (23,689)
Payments to acquire intangible
assets (14,570) - (7,898)
Net cash utilised by investing
activities (31,899) (9,020) (31,532)
Cash flows from financing
activities
Issue of ordinary share capital - - 57,500
New borrowings 10,000 - -
Repayment of borrowings (53,603) (11,000) (38,613)
(Decrease)/increase in bank
overdraft (36,800) (37,355) 836
Net cash generated by financing
activities (80,403) (48,355) 19,723
Net (decrease)/increase in cash
and cash equivalents (321) 1,743 1,611
Opening cash and cash
equivalents 3,216 1,605 1,605
Closing cash and cash
equivalents 2,895 3,348 3,216
CENTROM
GROUP
plc
Group Statement of Changes in
Equity
for the six months
ended 30 June 2008
Share Profit and Equity
Share premium loss shareholders' Minority Total
capital account account funds interests equity
At 1
January
2007 2,087,834 6,462,415 (1,474,427) 7,075,822 141,179 7,217,001
Profit
for the
half
year to
30 June
2007 - - 51,270 51,270 - 51,270
At 30
June
2007 2,087,834 6,462,415 (1,423,157) 7,127,092 141,179 7,268,271
Issue of
share
capital 57,500 - - 57,500 - 57,500
Loss for
the half
year to
31
December
2007 - - (397,318) (397,318) - (397,318)
At 31
December
2007 2,145,334 6,462,415 (1,820,475) 6,787,274 141,179 6,928,453
Loss for
the half
year to
30 June
2008 - - (184,056) (184,056) - (184,056)
2,145,334 6,462,415 (2,004,531) 6,603,218 141,179 6,744,397
CENTROM GROUP plc
Notes to the
Financial Statements
for the six months
ended 30 June 2008
General
1 information
Centrom Group plc is a public limited company ('Company')
incorporated in the United Kingdom under the Companies Act 1985
(registration number 5391225). The Company is domiciled in the
United Kingdom and its registered office address is Centrom House,
16 Church Road, Fleet, Hampshire GU51 3RH. The Company's ordinary
shares are traded on the Alternative Investment Market ('AIM').
The Group's principal activity is supplying consulting design
implementation and ongoing support of high performance IT network
solutions. The Company's principal activity is to act as a holding
company for its subsidiaries.
This consolidated interim statement was approved for issue by the
Board of Directors on 29 September 2008.
Basis of
2 preparation
The consolidated interim statement should be read in conjunction
with the annual financial statements for the year ended 31 December
2007, which have been prepared in accordance with IFRS as adopted
by the European Union on the historical cost basis.
The interim financial information has not been audited and does not
constitute statutory accounts within the meaning of Section 240 of
the Companies Act 1985. The Group's statutory accounts for the
year ended 31 December 2007 have been filed with the Registrar of
Companies and are available at www.centrom.com. The auditors'
report on those financial statements was unqualified and did not
contain any statement under Section 237 (2) or (3) of the Companies
Act 1985.
Accounting
3 policies
The accounting policies applied are consistent with those of the
annual financial statements for the year ended 31 December 2007, as
described in those financial statements.
Impairment of
development
4 expenditure
This relates to costs incurred during 2005 in the development of
the technology for facial recognition software. The Directors took
the prudent view that the carrying value of this asset is not
recoverable in the foreseeable future and decided to impair its
value to nil.
5 Revenue and segment reporting
The revenue and loss before tax are attributable to the one
principal activity of the Group. The directors consider that the
revenue is all one continuing segment being the support of high
performance IT network solutions, all originating in the UK.
Unaudited Unaudited
6 months 6 months Year ended
ended 30 ended 30 31 December
June 2008 June 2007 2007
� � �
United Kingdom 1,319,519 1,832,725 3,533,540
Loss per
6 ordinary share
The calculation of basic (loss)/profit per share has been
calculated on the net basis on the loss on ordinary activities
after taxation of �184,056 (2007 - �51,270 profit) using the
average number of 1p ordinary shares in issue of 214,533,400 (2007
- 208,783,400).
The diluted (loss)/profit per share is based on a loss for the
period of �184,056 (2007 - �51,270 profit) using the average number
of 1p ordinary shares of 214,533,400 (2007 - 211,783,400) after
adjusting for diluting options.
Unaudited Unaudited
6 months 6 months Year ended
ended 30 ended 30 31 December
June 2008 June 2007 2007
� � �
(Loss)/profit for the
period (184,056) 51,270 (346,048)
Basic (loss)/earnings
per share
Weighted number of
shares in issue 214,533,400 208,783,400 211,556,003
Basic (loss)/earnings
per share (pence) (0.08) 0.02 (0.16)
Diluted
(loss)/earnings per
share
Weighted number of
shares in issue 214,533,400 211,783,400 211,566,003
Diluted
(loss)/earnings per
share (pence) (0.08) 0.02 (0.16)
7 Dividends
No dividend is proposed.
8 Issue of equity
None issued in the period
The interim statement will be available from the Company's
registered office: Centrom House, 16 Church Road, Fleet, Hampshire
GU51 3RH and from the Company's website www.centrom.com
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