31st Jul 2015 07:43
LONDON (Alliance News) - Coms PLC Friday said it took impairment charges of about GBP8.7 million for its telephony services division in its last financial year, which pushed the infrastructure and smart buildings company into a loss.
Coms said it made a GBP14.9 million pretax loss in the year to the end of January, compared with a GBP1.2 million pretax profit in the prior year.
Revenue multiplied to GBP46.0 million from GBP14.0 million and administrative expenses rose to GBP12.4 million from GBP3.7 million.
Its impairment charges covered goodwill, other intangible assets, and property, plant and equipment, all within the telephony services division, which was sold to Timico Ltd for an initial GBP2.5 million in cash at the end of May, enabling Coms to concentrate on its infrastructure, smart buildings and IT managed services business. Coms then raised GBP2.0 million in June for working capital purposes.
Ex-CEO Dave Breith resigned in March, when Coms' non-executive directors began to run the business. Coms said that Breith has "intimated" that he intends to make an employment claim against the company. In its annual report, Coms said it disputes the employment related claim.
Coms listed a number of "outstanding issues" with the former CEO. Coms said that one of those claims regards office furniture and equipment, which, according to the company, Breith "claims are his personal property". Coms also said it has claims against the ex-CEO, such as "seeking repayment of moneys expended on Mr Breith's car".
Mark Braund, one of non-executives brought on board in March, resigned from leading staffing company Interquest Group PLC to become the chief executive of Coms.
"This past year has proved to be an exceedingly difficult year for the group. The group underwent significant change through a number of acquisitions under the previous management, aimed at building an integrated telecommunications group of scale. However, over the course of the year, despite several attempts to integrate the telecoms assets which the company had acquired, the management team was not able to secure the necessary anticipated savings," Chairman Frank Beechinor said in a statement.
Beechinor said Coms will report an operating loss for the first half of the current financial year, citing continued losses made by the telephony services division until its disposal, and expects the company's trading to improve after that point.
"With the additional capital injected from the placing and open offer which raised GBP2.0 million net of expenses in June 2015, the cash from the disposal of the telecoms assets and the cessation of the loss-making businesses, the board is confident that the group is better placed to embark on a more successful period of stability and growth," Beechinor said.
Coms shares were down 11.7% at 0.419 pence on Friday morning in London.
By Samuel Agini; [email protected]; @samuelagini
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