TIDMIPP
RNS Number : 2983X
IPPlus PLC
27 August 2015
IPPlus PLC
(the "Company" or the "Group")
Final Results for the Year Ended 30 June 2015
IPPlus PLC today announces its audited results for the year
ended 30 June 2015.
Financial Highlights
-- Successful sale of Ancora Solutions division in December 2014 for GBP500,000
-- Ansaback divisional revenues reduced to GBP5,441,094 (2014: GBP7,292,026)
-- Ansaback divisional revenues (excluding the terminated major
utility client) grew by 8.5% to GBP4,668,472 (2014:
GBP4,301,171)
-- Ansaback divisional operating profit of GBP424,508 (2014: GBP1,262,185)
-- CallScripter revenues slightly down to GBP1,045,847 (2014:
GBP1,099,867), but operating loss reduced by over 95% to GBP31,466
(2014: GBP678,653)
-- Group loss before taxation on continuing activities of
GBP258,244 (2014: profit of GBP297,189)
-- Deferred tax asset of GBP280,000 written off as the
utilisation of the asset unlikely in the near future due to R&D
tax credits
-- Group loss after taxation on continuing activities of
GBP538,022 (2014: profit of GBP301,890)
-- Closing cash and cash equivalents balance of GBP1,040,822 (2014: GBP459,693)
-- Dividend proposed of 0.15 pence per share for the year ended
30 June 2015 (subject to shareholder approval)
Operational Highlights
-- Long term clients and recurring revenues increased to 74%
(2014: 51%) of total continuing turnover
-- New Chairman and non-executive Director
-- PCI-PAL wins two prestigious international contracts post year end
-- Significant new Ansaback contract won from major UK retailer post year end
For further information, please contact:
IPPLUS PLC Tel: +44 (0)1473 321 800
William Catchpole, Chief Executive
Officer
Stuart Gordon, Chief Financial
Officer
N+1 Singer (Nomad & Broker) Tel: +44 (0)20 7496 3000
Aubrey Powell
Alex Wright
Ben Griffiths
CHAIRMAN'S STATEMENT
FOR THE YEAR ENDED 30 JUNE 2015
Financial Summary
The Board is disappointed to report that the Group has not been
successful in attracting sufficient new revenue to compensate for
the utility contract which substantially concluded last year. As a
result, the Group generated a loss on continuing activities before
tax of GBP258,244 (2014: profit of GBP297,189) on continuing
revenue of GBP6,486,941 (2014: GBP8,391,893).
The Board appreciates the importance of an established business
delivering a profit and has therefore been pleased to announce in
recent weeks that, since the year end, PCI-PAL, our compliant
credit card solution, has won two prestigious international
contracts within the Jewellery and Logistics sectors. In addition,
the Ansaback call centre has also secured a significant contract
with one of London's most prestigious department stores. Revenue
from this contract is expected to be substantial in the coming
year.
An increase in revenues from recurring and long-term clients
from 51% to 74% in the year, combined with these new business wins
and an attractive pipeline of further opportunities gives the Board
confidence that the Group will again generate a positive return to
shareholders in the coming year.
Disposal
As stated in the 2014 Annual Report and Accounts, the Board had
been actively reviewing the Ancora Solutions division and concluded
that it was non-core to the Group's business operations and that,
as it was relatively small in scale, an owner with a stronger
presence in its sector could potentially derive more value from the
business. On 31 December 2014 Restore PLC purchased the entire
fixed assets, payroll and existing contracts of Ancora Solutions
for a cash consideration of GBP500,000.
In the 6 months to 31 December 2014, Ancora Solutions reported
revenues of GBP362,803 and a loss on discontinued activities of
GBP53,856. This loss comprised a trading loss of GBP36,387,
reorganisation costs of GBP100,166, onerous lease provisions
(estimated outstanding lease costs on warehouse rentals) of
GBP121,000 and a profit on disposal of GBP203,697. The net book
value of the assets disposed of at 31 December 2014 was
GBP286,313.
Group overview
Subsequent to the disposal of Ancora Solutions the Group
operates through two divisional segments, namely Ansaback (which
includes IP3 Telecom, PCI-PAL and Suffolk Disaster Recovery) and
CallScripter.
Ansaback is a 24 hours a day, 7 days a week bureau telephony
service providing overflow and out of hours call handling,
emergency cover, dedicated phone resources, as well as disaster
recovery lines and facilities, and other ancillary
telecommunication services.
IP3 Telecom provides a range of network level interactive call
services including non-geographic and Freephone telephone
facilities. With options for self-sufficiency or fully managed
services, the platform gives the user the ability to run a
professional call handling operation without the necessity for
expensive hardware, installation, and on-going maintenance costs.
PCI-PAL is a hosted telephony Level 1 compliant credit card
solution designed to prevent card fraud by eliminating credit card
data being handled or stored at a clients' premises.
Suffolk Disaster Recovery is the Group's disaster recovery unit,
access to which is also sold to clients and third parties. Its
capacity increased from 60 seats to 90 seats during the year.
CallScripter is an enhanced customer interaction software suite
specifically developed for
contact centres, telesales and telemarketing operations. Our
clients gain major benefits by introducing CallScripter's dynamic
scripting environment into their organisation as the software
facilitates the rapid set-up, handling and reporting of
sophisticated inbound, outbound and e-mail campaigns.
Review of Operations
Ansaback division
Ansaback call centre
The Ansaback call centre had an extremely testing year and
suffered some difficulties with the adjustments required after its
largest client substantially ended its contract in August 2014.
This contract ending created more upheaval than originally
envisaged, which was compounded by tough economic concerns forcing
another client to take nearly half of its business back in-house. A
team of 350 temporary call handlers was stood down and managers
were made redundant or redeployed elsewhere within the
business.
IP3 Telecom (including PCI-PAL)
IP3 Telecom had a strong year winning some excellent new clients
and expanding its various Payment Card Industry ("PCI") services,
and the Directors believe that the potential of this business
continues to be exciting on both a domestic and international
basis. Our existing PCI-PAL client portfolio primarily comprises
blue chip household names that have chosen our package after
evaluating various competing solutions. These clients, for the most
part, are happy to be reference sites and provide testimonials to
our new prospective clients. The number of transactions and the
values passing through our secure network is now growing
dramatically.
Although new PCI-PAL competitors are emerging, the Directors
believe that the Group has a degree of first mover advantage and an
excellent brand which is easily understood by the target market. As
a result, we continue to be particularly excited by the prospects
for PCI-PAL.
CallScripter division
CallScripter, despite significantly reducing its segmental loss
by 95% at the end of the financial year, fell slightly short of
reaching divisional profitability by GBP31,466, on a similar
turnover to the prior year. The new 4.6 version release of its
software is anticipated at the Call Centre Expo in September
2015.
Dividend
Each year the Board decides whether to declare a dividend,
return capital to shareholders or purchase shares in the market to
be held as treasury stock. This decision is taken principally in
the light of: the Group's present and future expected performance;
its net cash balance; and its future working capital requirements
taking into account its investment plans for the future development
of the Group.
Taking these factors into consideration, although the Group had
a disappointing year, Ancora Solutions was successfully disposed of
providing an uplift in cash, and with the positive expectations for
the coming year on the back of the recently announced new business,
the Board is proposing to maintain the payment of a dividend of
0.15 pence per share in respect of the year ended 30 June 2015.
Board Changes
On 1 January 2015 I took over the role of Chairman from Philip
Dayer, who stepped down from the Board on 31 December 2014, and, on
1 January 2015, the Group appointed Jason Starr as a non-executive
Director, replacing Bernard Waldron who stepped down from the Board
on 30 September 2014. Jason is Chief Executive Officer of
Dillistone Group plc, the AIM quoted International supplier of
software and services for the recruitment sector.
The Board wishes to thank both Philip and Bernard for their wise
counsel and significant contribution to the Group.
People
I would like to thank each of the Directors and employees for
all of their efforts during the past year. Their commitment,
loyalty and support are appreciated in what transpired to be a
testing year.
Outlook
The Group has worked hard during the year to compensate for the
loss of the utility contract. However new business was not
sufficient to deliver a profit. The Board recognises the
fundamental importance of profit in an established business and is
encouraged by the new business won since the year end. It is also
pleased to report that the Group has, since the year end traded at
broadly breakeven, whereas at this point last year it was in loss,
therefore providing tangible evidence of the fruits of its efforts
coming to bear.
The Board therefore looks forward to producing much better
results in the first half of the coming year.
Chris Fielding
Non-Executive Chairman
26 August 2015
STRATEGIC REVIEW
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