19th Nov 2013 14:20
LONDON (Alliance News) - Eckoh PLC Tuesday said it swung to a half-year pretax loss after incurring a GBP1.2 million finance expense in relation to its acquisition of Veritape Limited, though revenues significantly increased on a like-for-like basis.
The automated secure payment technology company said it made a GBP1.4 million pretax loss for the six months ended September 30, compared with a GBP430,000 pretax profit for the corresponding period last year.
The swing was a result of finance costs incurred as a result of the acquisition of Veritape in June. Eckoh incurred the GBP1.2 million finance expense because of an increase in the fair value of the possible further payment of 16.7 million shares, as Eckoh's share price has increased since the deal was made. The further possible share payment, which depends on certain pretax profit targets' being met over the next two years, increased to GBP3.4 million on September 30, compared to GBP2.2 million when the acquisition was made.
Despite an increase in Eckoh's revenue to GBP6.3 million from GBP5.1 million last year, the company still swung to a GBP302 million loss from operating activities, after making a GBP404 million profit from operating activities for the corresponding period last year. This was a result of expenses relating to amortisation, share option scheme expenses and acquisition costs.
"The integration of our newly acquired business Veritape is going extremely well and the business rationale for being part of the Eckoh group is yielding returns at every level. We expect the substantial progress and growth achieved by the group in the first half of this year to continue throughout the remainder of the current financial year," Nik Philpot, Chief Executive, said in a statement.
Eckoh shares were Tuesday quoted at 29.00 pence, up 2.20%.
By Samuel Agini; [email protected]; @samuelagini
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