16th Sep 2014 08:17
LONDON (Alliance News) - Ubisense Group PLC said Tuesday it is confident in delivering full-year results in line with its expectations, despite posting a widened pretax loss in the half year to end-June due to higher operating costs.
The hardware, software and services company posted a pretax loss of GBP2.1 million, widened from a loss of GBP1.5 million, as revenues rose to GBP17.3 million from GBP12.4 million in the same period the previous year, although this was offset by higher cost of sales and operating expenses.
The jump up in costs primarily related to the integration of the company's acquisition Geoplan Interworks KK in December 2013. Ubisense posted a higher amortisation of intangible assets, as well as exceptional costs of GBP315,000 relating to redundancy costs and other expenses from its integration of Geoplan.
Geoplan is performing in line with expectations, Ubisense said.
Gross margin improved to 33.9% from 28.7% as the company shifted its revenue mix towards Solutions revenues, which have a higher margin than its Services revenues.
Revenue growth was driven by a strong performance in Ubisense's Solutions business. The company expects this growth to continue into the second half, since in previous years clients have tended to deploy their budgets later in the year. Services revenue also grew on the back of a number of new long-term contracts, and boosted by revenues from Geoplan.
Ubisense said a majority of its revenue comes from a small number of large deals. However it is building up revenue in its managed services, maintenance and support division, in order to stabilise revenue going forward.
The company said its order book was up 12% to GBP15.8 million from GBP14.1 million, providing it with good revenue visibility.
Ubisense said it had started the second half of the year with strong momentum; it plans to continue growing its Solutions business both organically and through acquisitions, which it said will enhance its position in the manufacturing, telecommunications and utility sectors.
Shares in Ubisense were trading down 2.3% at 168.00 pence Tuesday morning.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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