RNS Number : 4476D
Vicorp Group PLC
16 September 2008
Embargo for 7.00am 16 September 2008
Vicorp Group Plc
("Vicorp", "the Group", or "the Company")
Interim Accounts for the period ending 30 June 2008 and
Trading Update
Interim Results
The company announced that year on year revenues rose by �248,000 for the first half of 2008 but investment in sales and expansion of
the Professional Services team increased costs by �297,000. The loss from operations was �801,474 (�723,104) and the post tax loss was
�687,710 (�633,321). The year on year reduction in total assets to 30 June was �965,000.
Brendan Treacy, Chief Executive of Vicorp, commented: "The first half trading for 2008 has been slower than the Board expected but
should be revealed in time as a temporary slowdown. The company invested heavily in selling and has created a good pipeline of
opportunities, many of which are late stage. Our challenge is to return to positive trading in the second half of 2008 and we are close to
reaching that position".
A copy of the interim results is available on the company website www.vicorp.com
Issue of debt
Vicorp has agreed a �275,000 nine month term loan. The Loan will be repaid in monthly annuity installments beginning on 30 November 2008
and ending on 30 April 2009. The Lender has also been granted warrants to subscribe for up to 500,000 Ordinary Shares in the Company,
exercisable at a price of 0.9 pence per share at any point up to August 2012 (the current value of the warrants is less than �3,000).
Research Note
Edison Investment Research have today published a note on the Company that is available on the Company website www.vicorp.com
-ends-
For further information, please contact:
Brendan Treacy, Chief Executive, Vicorp Group PLC 01753 660 500
Peter Manfield, SVS Securities PLC 0207 638 5600
Ray Zimmerman/Jonathan Evans, Zimmerman Adams International Limited 0207 060 1760
Chairman's Statement
Our results for the first six months of 2008 have been below the expectations of the Board. The company has experienced a slow take up
of project work resulting in a reduction in the expected licensing revenue from placing applications into live production. The Board does
not attribute the slowness to credit or economic conditions but to the size of the current Vicorp client base.
The loss of �687,000 after tax (�633,000 loss H1 2007) was affected by the decision to place greater resources into growing revenue by
increasing the sales team and taking on board some key skills to augment the professional services organisation. As a result, the group
operating costs rose by some �297,000 over H1 of 2007. However, it should be noted that in 2007 the company did not have a defined
professional services organisation. The loss has contributed to a reduction in net assets of �1.0M since the end of June 2007.
Revenues of �804,229 were approximately �248,000 higher compares to H1 2007, principally reflecting the investment in services
capability, albeit below target.
Looking forward, and taking into account the actions of the Board to invest in sales resources, the company has now built a strong list
of sales opportunities that are greater than at any previous stage of the company's development. More recently, operating costs have been
trimmed back to reduce the annual run rate of expenditure to some �600,000 below the rate at the start of H2 2008 and in the absence of any
revenue impact from this decision, the company intends to maintain costs at the current level (approximately �2.6M of annual costs) well
into 2009.
In August 2008 the company accepted a commercial term loan of �275,000 for a period of nine months to assist it in bridging any delay
between start times on H2 2008 projects and the project payment cycles. The directors will continue to assess the status of working capital
carefully throughout the remainder of 2008 and into 2009 and will look to take any necessary steps to ensure that the Group has sufficient
cash resources to realise the opportunities that it has now created.
The Group experienced a strong revenue uplift in H2 of 2007 and the directors believe that H2 of this year will also be a strong
improvement over the first half year. Any vulnerability in connection with H2 revenues lies principally with project start dates and not
with the identification and winning of short-term business.
The product development team is just about to release version 5.0 of the xMP product, which marks a significant plateau for the xMP
features and improved benefits from using Vicorp tooling in the speech market. Our product positioning and continuing innovation remain
strong and still act as the key differentiator for the company.
Our professional services team continues to add strength to the Group and during September 2008 the company was awarded "Best
Professional Services" Award at the annual SpeechTEK 2008 conference in New York. This is a great achievement only a year or so after
establishing the professional service team and is now highly visible to the industry.
Whilst conditions have been generally slow, the voice application market is one that is not currently contracting in volume but is
seeing growth from the ever present need to provide cost effective and high quality customer response capability in most major enterprises.
We at Vicorp are set to continue on an upward path and would like to thank all of the many people inside and outside the Group that are
contributing towards our steady growth.
Tim Hearley
Non-Executive Chairman
Condensed Consolidated Balance Sheet at 30 June 2008
01 Jan - 30 June 01 Jan - 31 Dec 2007 01 Jan - 30 June
2008 2007
� � �
Assets
Non-current assets
Property, plant and equipment 76,728 90,870 99,044
Other intangible assets 649,906 570,779 441,668
Investments - - -
-------------------- -------- --------------------
----------------- -------------------- -------------------
---------
726,634 661,649 540,712
Current assets
Inventories 4,504 4,997 4,866
Trade receivables 395,446 538,314 371,934
Other current assets 412,964 388.184 387,414
Cash and cash equivalents 10,515 270,269 1,210,373
-------------------- -------------------- --------------------
----------------- ------------------- -------------------
823,429 1,201,764 1,974,587
-------------------- -------------------- --------------------
----------------- ------------------- -------------------
Total assets 1,550,063 1,863,413 2,515,299
-=================== -=================== -===================
==- ==- ==-
Equity and liabilities
Equity attributable to equity
holders of the parent
Share capital 192,063 192,062 192,063
Share premium 5,886,788 5,886,788 5,897,740
Retained earnings (5,539,988) (4,852,281) (4,763.947)
-------------------- -------------------- --------------------
----------------- ------------------- -------------------
538,863 1,226,569 1,325,856
-=================== -=================== -===================
==- ==- ==-
Current liabilities
Trade and other payables 975,106 629,102 1,040,706
Bank overdraft and loans -due 36,094 7,742 148,737
within a year
-------------------- -------------------- --------------------
----------------- ------------------- ----------------
Total liabilities 1.011,200 636,844 1,189,443
-=================== -=================== -===================
==- ==- ==-
Total equity and liabilities 1,550,063 1,863,413 2.515,299
==================== -=================== -===================
=- ==- ==-
Condensed Consolidated Income Statement for the financial period ended 30 June 2008
01 Jan - 30 June 01 Jan - 30 June 2007
2008
� �
Revenue 804,229 556,328
Cost of sales (39,133) (9,451)
-------------------- ----------------------------------
--------------
Gross profit 765,096 546,877
Administrative expenses 1,566,570 1,269,981
-------------------- ----------------------------------
--------------
Loss from operations (801,474) (723,104)
==================== =====================
=
Finance (costs)/income 1,403 (22,362)
==================== =====================
=
Loss before tax (800,071) (745,466)
Income tax income 112,361 112,145
-------------------- ----------------------------------
--------------
Loss for the period (687,710) (633,321)
==================== ====================-
-
Loss per share diluted and undiluted 0.00358p and 0.00294p.
All of the activities of the group are classed as continuing.
Condensed Consolidated Statement of Changes in Equity for the period ended 30 June 2008
Share capital Share premium Accumulated losses Total
� � � �
Balance at 31 December 2006 104,612 3,495,694 (4,140,647) (540,341)
Changes in equity for the
period Jan - June 2007
Loss for the period - - (633,321) (633,321)
Share options adjustment 10,021 10,021
-------------------- -------------------- -------------------- ----------------------------
-------- ------ ------- -
Total recognised income and - - (623,300) (623,300)
expense for the period
==================== ==================== ==================== =====================
= = =
Issue of share capital 87,451 2,402,046 - 2,489,497
-------------------- -------------------- -------------------- ----------------------------
-------- ------ ------- -
Balance at 30 June 2007 192,063 5,897,740 (4,763,947) 1,325,856
==================== ==================== ==================== =====================
= = =
Changes in equity for the (78,310) (78,310)
period July - Dec 2007
Loss for the period - -
Share options adjustment (10,021) (10.021)
-------------------- -------------------- -------------------- ----------------------------
-------- ------ ------- -
Total recognised income and - (88,331) (88,331)
expense for the period
==================== ==================== ==================== =====================
= =
Issue of share capital (10.952) - (10,952)
-------------------- -------------------- -------------------- ----------------------------
-------- ------ ------- -
Balance at 31 Dec 2007 192,063 5,886,788 (4,852,278) 1,226,573
==================== ==================== ==================== =====================
= = =
Changes in equity for the
period Jan - June 2008
Loss for the period (687,710) (687,710)
-------------------- -------------------- -------------------- ----------------------------
-------- ------ ------- -
Total recognised income and - - (687,710) (687,710)
expense for the period
==================== ==================== ==================== =====================
= = =
Issue of share capital - - -
-------------------- -------------------- -------------------- ----------------------------
-------- ------ ------- -
Balance at 30 June 2008 192,063 5,886,788 (5,539,988) 538,863
==================== ==================== ==================== =====================
= = =
Condensed Consolidated Cash Flow Statement for the period ended 30 June 2008
01 Jan - 30 June 2008 01 Jan - 30 June 2007
� �
Cash flow from operating
activities
Loss from operations (801,474) (723,104)
Adjustments for:
Depreciation of property, 224,902 28,532
plant and equipment
Share options adjustment - 10,021
Operating cash flows before (576,572) (684,551)
movement in working capital
===================== =====================
(Increase)/decrease in 497 1,081
inventories
(Increase)/decrease in 118,088 (374,842)
receivables
Increase/(decrease) in 374,356 (137,588)
payables
Income taxes received 112,361 112,145
Interest received (1,145) (23,025)
Net cash from/(used in) 604,157 (422,229)
operating activities
===================== =====================
Investing activities
Interest received 2,548 663
Purchases of property, plant (289,887) (10,770)
and equipment
Net cash used in investment (287,339) (10,107)
activities
===================== =====================
Cash flows from financing
activities
Repayments of borrowings - (215,000)
Proceeds on issue of - -
convertible loan notes
Issue of equity share capital - 87,451
Share premium on issue of - 2,402,044
equity share capital
Net cash from financing - 2,274,495
activities
===================== =====================
Net increase/(decrease) in (259,754) 1,157,608
cash and cash equivalents
Cash and cash equivalents at 270,269 (310,974)
beginning of year
Net cash outflow / (inflow) - 215,000
from debentures
Cash and cash equivalents at 10,515 1,061,634
end of year
===================== =====================
Bank balances and cash 10,515 1,061,634
===================== =====================
NOTES TO THE FINANCIAL STATEMENTS PERIOD ENDED 30 JUNE 2008
1 Accounting policies
These interim financial statements have been prepared in accordance with the requirements of IAS 34 Interim Financial Reporting, using
accounting policies consistent with those set out in the Annual Report and Accounts of Vicorp Group Plc for the year ended 31 December 2007.
Copies of the 2007 Annual Report are available on request from Vicorp or its Nominee advisors.
2. IAS 38 treatment of development costs
The Vicorp Group accounting policy for the treatment of software development is now in accordance with IAS38.
The criteria for capitalising expenditure on software development are as follows:
* Any capitalised expenditure must be asset specific and identifiable. Vicorp adopts the same cost identification for IAS as it does
for the measurement of research and development tax claims
* Vicorp must retain full control of asset IPR
* Future net economic benefit must be identifiable. This means being able to identify or reasonably predict net economic benefits
over the useful life of the asset.
Amortisation basis:
* Straight line basis over the identified period for the useful economic life of the asset
* Annual reassessment of the useful economic life after adjusting for any impairment in carried` value
Carried value
The carried value of software development will be annually assessed. Examples of factors, which could cause impairment, are: a) new
competitive products; b) end of life for contracted revenues.
3 Property, plant and equipment
Leasehold Equipment, Fixtures Computer Hardware & Total
Improvements & Fittings Software
� � � �
Cost or valuation
At 1 January 2008 97,691 23,930 440,718 562,339
Additions - - 8,983 8,983
At 30 June 2008 97,691 23,930 449,701 571,322
Accumulated Depreciation
At 1 January 2008 44,875 16,939 409,655 471,469
Charge for the year 9,769 1,997 11,359 23,125
At 30 June 2008 54,644 18,936 421,014 494,594
Carrying amount
At 30 June 2008 43,047 4,994 28,687 76,728
============== ============ ============== ==============
At 31 December 2007 52,816 6,991 31,063 90,870
============== ============ ============== ==============
4 Other Intangible assets
Development Costs
�
Cost
At 1 January 2008 3,036,665
Additions 280,904
At 30 June 2008 3,317,569
=============
Amortisation
At 1 January 2008 2,465,886
Charge for the year 201,777
At 30 June 2008 2,667,663
=============
Carrying amount
At 30 June 2008 649,906
=============
At 31 December 2007 570,779
=============
5 Segment Information
No segmental information is provided as, in the directors' opinion, only one economic operation exits.
6 Audit
The Interim financial statements are unaudited and do not constitute statutory accounts within the meaning of Section 240 of the
Companies Act 1985. The Group's auditors have reviewed the information and their report is set out on page 3.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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