19th Apr 2010 07:00
NetDimensions (Holdings) Limited
("NetDimensions", the "Group" or the "Company")
Preliminary Results for the year ended 31 December 2009
NetDimensions (AIM: NETD), a provider of performance, knowledge and learning management systems, announces its Preliminary Results for the year ended 31 December 2009 which mark a return to pre-tax profitability.
Financial Highlights
·; Revenues up 8% to US$6.84 million (2008: US$6.35 million)
·; Operating profit of US$0.69 million (2008: US$0.09 million)
·; Pre-tax profit of US$0.7 million (2008: loss before taxation US$0.59 million)
·; Cash balances of US$7.44 million - equates to c.18.6p per share (2008: US$5.34 million)
·; Revenue from new clients contributing 23% of the total revenue
·; Operating expenses reduced by US$0.24 million
Operational Highlights
·; Launch of versions 5.6 and 5.7 of the Company's flagship Enterprise Knowledge Platform (EKP)
·; Implemented infrastructure and process improvements to support future growth
·; Continued expansion in the Philippines
·; 70 new clients added
Roger Durn, Chairman of NetDimensions, commented:
"I am pleased to report strong growth in revenue over the past financial year, despite the challenging global economic environment, resulting in a return to pre-tax profitability. To position ourselves for the future, we also expanded our lower cost support and development operations in the Philippines by doubling the country headcount in 2009. In addition, we have maintained a healthy cash level and remain in a good position to grow.
"We believe that recent economic indicators look positive and the Company's 2010 first quarter trading results were in line with management expectations."
Enquiries:
|
NetDimensions
|
Jay Shaw Clarence Wu
|
+852 2122 4500
|
|
Arden Partners plc
(Nomad & Broker) |
Fred Walsh Matthew Armitt |
+44 (0) 20 7614 5917
|
|
Walbrook PR Limited
|
Paul McManus
Ben Knowles
|
+44 (0) 20 7933 8780 +44 (0) 7980 541 893 +44 (0) 7900 346 978 |
CHAIRMAN'S STATEMENT
Financial Summary
I am pleased to report on the financial results for NetDimensions (Holdings) Limited for the year ended 31 December 2009. Despite a challenging economic environment, total revenue increased by 8% to US$6.84 million (2008: US$6.35 million) with revenue from new clients contributing 23% of the total.
The Company achieved substantial revenue growth in the Europe, Middle East and Africa (EMEA) region, a geography on which we concentrated sales and marketing efforts. EMEA contributed 52% of total revenue compared to 37% in the previous financial year. Our continued focus on Software as a Service ("SaaS") hosting services also proved successful. Hosting revenue rose to US$2.69 million, up 26% from the previous year.
In light of the weak global economy, NetDimensions implemented tight cost controls and managed to reduce overhead expenses by US$0.24 million as compared to 2008 expenses, a reduction from 92% to 82% of total revenue. The Company ended the year with an organic operating profit of US$0.69 million.
During the year, the favourable Sterling and Euro exchange rates resulted in a US$0.18 million exchange gain and the operations helped generate US$0.01 million of finance income. After taking into account the US$0.18 million in losses for two strategic investments in 2009, the Group's profit before tax was US$0.7 million (2008: loss before tax of US$0.59 million).
The Company has continued to maintain a strong cash position, with cash balances of US$7.44 million (2008: US$5.34 million) and no debt. Net cash generated from operating activities for the year totalled US$2.02 million (2008: US$0.65 million).
The Board does not recommend payment of a dividend at this stage in the Company's development, however, it is the Board's intention to pay dividends in the future. Surplus funds will be reinvested to support the continued growth of the Company.
Operational Review
In 2009, NetDimensions put in place infrastructure and process improvements to support future growth while focusing on client retention and cost control.
In the interest of managing expenses, the Company reset expansion initiatives planned in 2008, except for initiatives relating to EMEA marketing and sales and to support service increases in the Company's two Asian offices. The Company's Philippines office doubled in size, in line with the Company plans to expand support and development operations into its lowest cost operating center.
The Company continued to work with major existing clients such as ING Group, HSBC, Cathay Pacific Airways and The Chicago Police Department. Our existing clients which mostly are in highly regulated industries accounted for the client retention rate of 88% in 2009.
The Company's reseller network accounted for 31% of 2009 revenue, helping the Company add some 55 of its 70 new clients during the year, including the Butterfield Group throughout its worldwide offices, the Metropolitan Housing Partnership in the United Kingdom, The New Zealand Department of Corrections and United Laboratories, Inc., the largest consumer prescription and health products company in the Philippines.
In 2009, the Company released versions 5.6 and 5.7 of its flagship product, the Enterprise Knowledge Platform (EKP). The 2009 EKP releases included dashboard reporting for senior managers, wiki integration to provide more end-user collaboration and social networking capabilities, and two new payment gateways for e-commerce use. Other product enhancements included continuing improvements to the EKP Portal Toolkit and to the Company's testing and certification engine, the Enterprise Assessment Platform.
During the year the Company's software engineering group adopted Agile software development methodology in order to foster faster release cycles, permit rapid delivery of incremental product improvements and incorporate more user feedback in the development process. The Agile development methodology complements the Company's ISO 9001:2008 quality management system in use in other departments.
The Company celebrates its 10th anniversary, a milestone that has marked the Company's progress from a two-man start-up in 1999 to an AIM listed company in 2007 with clients, operations and resellers in more than 25 countries.
NetDimensions ended the year with approximately 800 clients around the world.
Outlook
NetDimensions has a sound business model and, as an expanding and cash generative business, remains in a good position to grow. We have maintained a healthy cash level, with cash balances on 31 December 2009 of US$7.44 million, mostly held in Sterling and US Dollars.
We will continue to focus on employee and extended enterprise training and performance support applications, mostly for clients in highly regulated and compliance driven industries.
We believe that recent economic indicators look positive, largely due to the current low interest rate environment. However, low interest rates may not continue. Different countries may launch different monetary policies, which may in turn lead to market uncertainties in our focus geographies. Nevertheless, the Company's 2010 first quarter trading results were in line with management expectations.
Roger Philip Edward Durn
Chairman
19 April 2010
CONSOLIDATED INCOME STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2009
|
|
|
2009 |
|
2008 |
|
|
Notes |
US$ |
|
US$ |
|
|
|
|
|
|
|
Revenue |
3&6 |
6,839,795 |
|
6,352,524 |
|
|
|
|
|
|
|
Cost of sales |
|
(561,001) |
|
(421,645) |
|
|
|
|
|
|
|
Gross profit |
|
6,278,794 |
|
5,930,879 |
|
|
|
|
|
|
|
Administrative expenses |
|
(5,586,308) |
|
(5,837,302) |
|
|
|
|
|
|
|
Operating profit |
|
692,486 |
|
93,577 |
|
|
|
|
|
|
|
Net finance gains/(costs) |
4 |
191,427 |
|
(507,795) |
|
Impairment loss on goodwill |
|
(54,604) |
|
- |
|
Share of loss of an associate |
|
(78,955) |
|
(24,041) |
|
Share of loss of a jointly controlled entity |
|
(49,597) |
|
(150,403) |
|
|
|
|
|
|
|
Profit/(loss) before taxation |
|
700,757 |
|
(588,662) |
|
|
|
|
|
|
|
Taxation |
|
(21,000) |
|
- |
|
|
|
|
|
|
|
Profit/(loss) for the year |
|
679,757 |
|
(588,662) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Attributable to: |
|
|
|
|
|
Equity shareholders of the Company |
|
679,757 |
|
(588,662) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings/(loss) per share: |
|
|
|
|
|
Basic |
5 |
US$ 0.03 |
|
US$(0.02) |
|
Diluted |
5 |
US$ 0.03 |
|
US$(0.02) |
|
|
|
|
|
|
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2009
|
|
2009 |
|
2008 |
|
|
US$ |
|
US$ |
|
|
|
|
|
|
Profit/(loss) for the year |
679,757 |
|
(588,662) |
|
|
|
|
|
|
Other comprehensive income: |
|
|
|
|
|
|
|
|
|
Exchange differences on translation of |
|
|
|
|
foreign operations |
1,422 |
|
37,702 |
|
|
|
|
|
|
Share of other comprehensive income of |
|
|
|
|
an associate |
152 |
|
316 |
|
|
|
|
|
|
Other comprehensive income for the year |
1,574 |
|
38,018 |
|
|
|
|
|
|
Total comprehensive income for the year |
681,331 |
|
(550,644) |
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income attributable to: |
|
|
|
|
Equity shareholders of the Company |
681,331 |
|
(550,644) |
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2009
|
|
2009 |
|
2008 |
|
|
US$ |
|
US$ |
|
ASSETS |
|
|
|
|
Non-current assets |
|
|
|
|
|
|
|
|
|
Property, plant and equipment |
137,648 |
|
144,394 |
|
Intangible assets |
26,138 |
|
49,790 |
|
Interest in an associate |
92,868 |
|
226,275 |
|
Interest in a jointly controlled entity |
- |
|
49,597 |
|
|
|
|
|
|
|
256,654 |
|
470,056 |
|
|
|
|
|
|
Current assets |
|
|
|
|
Trade and other receivables |
2,480,929 |
|
3,254,905 |
|
Cash and cash equivalents |
7,444,665 |
|
5,338,405 |
|
|
|
|
|
|
|
9,925,594 |
|
8,593,310 |
|
|
|
|
|
|
TOTAL ASSETS |
10,182,248 |
|
9,063,366 |
|
|
|
|
|
|
EQUITY AND LIABILITIES |
|
|
|
|
|
|
|
|
|
Equity attributable to equity holders of the Company |
|
|
|
|
Notes |
|
|
|
|
|
|
|
|
|
Share capital 7 |
25,014 |
|
24,914 |
|
Reserves |
6,432,554 |
|
5,727,407 |
|
|
|
|
|
|
Total equity |
6,457,568 |
|
5,752,321 |
|
|
|
|
|
|
Non-current liabilities |
|
|
|
|
|
|
|
|
|
Obligations under finance leases |
- |
|
1,026 |
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
|
|
|
Trade and other payables |
3,713,655 |
|
3,308,651 |
|
Income tax payable |
10,000 |
|
- |
|
Obligations under finance leases |
1,025 |
|
1,368 |
|
|
|
|
|
|
|
3,724,680 |
|
3,310,019 |
|
|
|
|
|
|
Total liabilities |
3,724,680 |
|
3,311,045 |
|
|
|
|
|
|
TOTAL EQUITY AND LIABILITIES |
10,182,248 |
|
9,063,366 |
The financial statements were approved by the Board of Directors on 19 April 2010 and were signed on its behalf by Clarence On Pong Wu, Director.
STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2009
|
|
2009 |
|
2008 |
|
|
US$ |
|
US$ |
|
ASSETS |
|
|
|
|
Non-current assets |
|
|
|
|
|
|
|
|
|
Investments in subsidiaries |
902,737 |
|
902,737 |
|
Interest in an associate |
79,870 |
|
250,000 |
|
Interest in a jointly controlled entity |
- |
|
200,000 |
|
|
|
|
|
|
|
982,607 |
|
1,352,737 |
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
|
|
|
Trade and other receivables |
4,362,019 |
|
4,217,113 |
|
Cash and cash equivalents |
3,323,159 |
|
3,533,224 |
|
|
|
|
|
|
|
7,685,178 |
|
7,750,337 |
|
|
|
|
|
|
TOTAL ASSETS |
8,667,785 |
|
9,103,074 |
|
|
|
|
|
|
|
|
|
|
|
EQUITY AND LIABILITIES |
|
|
|
|
|
|
|
|
|
Equity attributable to equity holders of |
|
|
|
|
the Company |
|
|
|
|
Notes |
|
|
|
|
|
|
|
|
|
Share capital 7 |
25,014 |
|
24,914 |
|
Reserves |
8,585,716 |
|
9,026,478 |
|
|
|
|
|
|
Total equity |
8,620,730 |
|
9,051,392 |
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
|
|
|
Trade and other payables |
47,055 |
|
51,682 |
|
|
|
|
|
|
Total liabilities |
47,055 |
|
51,682 |
|
|
|
|
|
|
TOTAL EQUITY AND LIABILITIES |
8,667,785 |
|
9,103,074 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The financial statements were approved by the Board of Directors on 19 April 2010 and were signed on its behalf by Clarence On Pong Wu, Director.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2009
|
|
Share capital |
Share premium |
Foreign currency translation reserve |
Accumulated losses |
Total |
|
|
|
|
|
|
|
|
|
US$ |
US$ |
US$ |
US$ |
US$ |
|
|
|
|
|
|
|
|
At 1 January 2008 |
24,864 |
11,116,871 |
(5,211) |
(4,872,470) |
6,264,054 |
|
|
|
|
|
|
|
|
Loss for the year |
- |
- |
- |
(588,662) |
(588,662)
|
|
Other comprehensive income for the year |
- |
- |
38,018 |
- |
38,018 |
|
Total comprehensive income for the year |
- |
- |
38,018 |
(588,662) |
(550,644) |
|
Equity settled share-based payments |
|
- |
- |
38,861 |
38,861 |
|
Issue of shares |
50 |
- |
- |
- |
50 |
|
|
|
|
|
|
|
|
At 31 December 2008 and 1 January 2009 |
24,914 |
11,116,871 |
32,807 |
(5,422,271) |
5,752,321 |
|
|
|
|
|
|
|
|
Profit for the year |
- |
- |
- |
679,757 |
679,757
|
|
Other comprehensive income for the year |
- |
- |
1,574 |
- |
1,574 |
|
Total comprehensive income for the year |
- |
- |
1,574 |
679,757 |
681,331 |
|
Equity settled share-based payments |
- |
- |
- |
23,816 |
23,816 |
|
Issue of shares |
100 |
- |
- |
- |
100 |
|
|
|
|
|
|
|
|
At 31 December 2009 |
25,014 |
11,116,871 |
34,381 |
(4,718,698) |
6,457,568 |
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2009
|
|
2009 |
|
2008 |
|
|
US$ |
|
US$ |
|
|
|
|
|
|
Cash generated from operations |
2,033,680 |
|
648,844 |
|
Income tax paid |
(11,000) |
|
- |
|
|
|
|
|
|
Net cash generated from operating activities |
2,022,680 |
|
648,844 |
|
|
|
|
|
|
Cash flows from investing activities |
|
|
|
|
|
|
|
|
|
Purchase of property, plant and equipment |
(88,880) |
|
(43,495) |
|
Purchase of intangible assets |
(19,397) |
|
(56,828) |
|
Interest income received |
6,940 |
|
199,571 |
|
Investment in an associate |
- |
|
(250,000) |
|
Investment in a jointly controlled entity |
- |
|
(200,000) |
|
|
|
|
|
|
Net cash used in investing activities |
(101,337) |
|
(350,752) |
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
|
|
|
|
|
Finance lease charges |
(335) |
|
(335) |
|
Repayments of borrowings and finance leases |
(1,368) |
|
(1,368) |
|
|
|
|
|
|
Net cash used in financing activities |
(1,703) |
|
(1,703) |
|
|
|
|
|
|
Net increase in cash and cash equivalents |
1,919,640 |
|
296,389 |
|
|
|
|
|
|
Cash and cash equivalents at beginning of the year |
5,338,405 |
|
5,711,745 |
|
Effect of foreign exchange rate changes, net |
186,620 |
|
(669,729) |
|
|
|
|
|
|
Cash and cash equivalents at end of the year |
7,444,665 |
|
5,338,405 |
|
|
|
|
|
NOTES TO THE FINANCIAL STATEMENTS
1. GENERAL INFORMATION
The Company was incorporated inthe Cayman Islands as a limited liability company under the Companies Law (2000) Revision on 10 July 2000. Its shares are listed on the London Stock Exchange AIM. The registered office of the Company is located atP.O. Box 309, Ugland House, South Church Street, George Town, Grand Cayman, Cayman Islands, British West Indies. Its principal place of business is located at 17/F., Siu On Centre, 188 Lockhart Road, Wan Chai, Hong Kong.
The principal activities of the Company and its subsidiaries (hereinafter collectively referred to as the "Group") are licensing of computer software and the provision of related services. The principal activity of the Company is investment holding. The principal activities of its subsidiaries are set out in note 14 to the financial statements.
2. FINANCIAL RISK MANAGEMENT
The Group's current activities result in the following financial risks and management's responses to those risks in order to minimise any resulting adverse effects on the Group's financial performance.
(a) Foreign exchange risk
The Group's reporting currency is US dollars. Its principal activities are licensing of computer software and the provision of related services in various currencies, particularly US dollars and Hong Kong dollars ("HK dollars"). Since HK dollars is currently pegged to the US dollars, no significant exposure is expected on HK dollars transactions and balances.
The following table indicates the approximate change in the Group's profit/(loss) after taxation (and accumulated losses) and other components of consolidated equity in response to reasonably possible changes in the foreign exchange rates to which the Group has significant exposure at the end of the reporting period. The analysis includes balances between Group entities where the denomination of the balances is in a currency other than the functional currencies.
|
|
2009 |
|
2009 |
|
2008 |
|
2008 |
|
The Group |
Increase/ (decrease) in foreign exchange rates |
|
Effect on profit after taxation and accumulated losses US$'000 |
|
Increase/ (decrease) in foreign exchange rates |
|
Effect on loss after taxation and accumulated losses US$'000 |
|
|
|
|
|
|
|
|
|
|
HK dollars |
1% |
|
4 |
|
1% |
|
30 |
|
|
(1%) |
|
(4) |
|
(1)% |
|
(30) |
|
|
|
|
|
|
|
|
|
|
Pounds Sterling |
15% |
|
258 |
|
9% |
|
119 |
|
|
(15%) |
|
(258) |
|
(9)% |
|
(119) |
|
|
|
|
|
|
|
|
|
|
Euro |
6% |
|
44 |
|
7% |
|
182 |
|
|
(6%) |
|
(44) |
|
(7)% |
|
(182) |
The sensitivity analysis has been determined assuming that the change in foreign exchange rates had occurred at the end of the reporting period and had been applied to each of the Group entities' exposure to currency risk for both derivative and non-derivative financial instruments in existence at that date, and that all other variables, in particular interest rates, remain constant.
The stated changes represent management's assessment of reasonably possible changes in foreign exchange rates over the period until the end of next annual reporting period. In this respect, it is assumed that the pegged rate between the HK dollars and US dollars would not be materially affected by any changes in movement in value of US dollars against other currencies. Results of the analysis as presented in the above table represent an aggregation of the effects on each of the Group entities' profit/(loss) after taxation and accumulated losses measured in the respective functional currencies, translated into US dollars at the exchange rate ruling at the end of the reporting period for presentation purposes. The analysis is performed on the same basis for 2008.
(b) Interest rate risk
Interest rate risk arises from debt borrowingsand cash held on deposit. The Group has no external borrowings therefore the Group currently has no interest rate risk exposure. The Group's cash balances are kept in interest bearing current accounts and on short-term deposits, so as to maximise the level of return while maintaining an adequate level of liquidity.
(c) Credit risk
The Group's credit risk is primarily attributable to trade and other receivables. Management has a credit policy in place and the exposure to credit risk is monitored on an ongoing basis. Credit evaluations are performed on all customers requiring credit over a certain amount. The Group does not require collateral in respect of financial assets.
At the end of the reporting period, there were no significant concentrations of credit risk. The maximum exposure to credit risk is represented by the carrying amount of each financial asset in the statement of financial position.
(d) Liquidity risk
The availability of adequate cash resources is managed by the Group through managing its funds conservatively thereby ensuring it meets its continual operational requirements. The Group's financial liabilities as at 31 December 2009, which fall due within 12 months from the end of reporting period were US$ 3,724,680 (2008: US$ 3,310,019).
3. REVENUE
Revenue represents the aggregate of income from software licensing, hosting services, support and maintenance and software customisation and implementation services during the year and is analysed as follows: -
|
|
2009 |
|
2008 |
|
|
US$ |
|
US$ |
|
|
|
|
|
|
Software licensing |
2,574,937 |
|
2,986,803 |
|
Hosting |
2,687,848 |
|
2,139,048 |
|
Support and maintenance |
1,127,230 |
|
892,602 |
|
Software customisation and implementation |
449,780 |
|
334,071 |
|
|
|
|
|
|
|
6,839,795 |
|
6,352,524 |
4. NET FINANCE GAINS/(COSTS)
|
|
2009 |
|
2008 |
|
|
US$ |
|
US$ |
|
|
|
|
|
|
Bank interest income |
6,940 |
|
199,571 |
|
Finance lease charges |
(335) |
|
(335) |
|
Foreign exchange gain/(loss) |
184,822 |
|
(707,031) |
|
|
|
|
|
|
|
191,427 |
|
(507,795) |
5. EARNINGS/(LOSS) PER SHARE
The calculation of the basic and dilutedearnings/(loss)per share is based on the following data:
|
|
2009 |
|
2008 |
|
|
US$ |
|
US$ |
|
Earnings/(loss) used for the 'Earnings/(loss) per share' |
|
|
|
|
|
|
|
|
|
Earnings/(loss) for the purpose of basic earnings/(loss) per share being net profit/(loss) attributable to equity shareholders of the parent |
679,757 |
|
(588,662) |
|
|
|
|
|
|
Earnings/(loss) for the purpose of diluted earnings/(loss) per share |
679,757 |
|
(588,662) |
|
|
|
|
|
|
|
2009 |
|
2008 |
|
|
|
|
|
|
|
|
Number of shares |
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of ordinary shares for the purpose of basic earnings/(loss) per share |
24,961,658 |
|
24,885,980 |
|
|
|
|
|
|
|
|
Effect of dilutive potential ordinary shares: |
|
|
|
|
|
Share options |
1,226,500 |
|
1,239,475 |
|
|
|
|
|
|
|
|
Weighted average number of ordinary shares for the purpose of dilutive earnings/(loss) per share |
26,188,158 |
|
26,125,455 |
|
|
|
|
|
|
|
|
|
|
2009 |
|
2008 |
|
|
|
US$ |
|
US$ |
|
Earnings/(loss) per share: |
|
|
|
|
|
Basic |
|
0.03 |
|
(0.02) |
|
Diluted |
|
0.03 |
|
(0.02) |
|
|
|
|
|
|
6. SEGMENTAL ANALYSIS
The Group operates in three geographic segments, North America, Europe, Middle East and Africa ("EMEA") and Rest of the World. These geographic segments are the basis on which the Group reports its primary segment information, as presented below:
Segmental information for the year ended 31 December 2009:
|
|
North |
|
|
|
Rest of the |
|
|
|
|
America |
|
EMEA |
|
World |
|
Total |
|
|
US$ |
|
US$ |
|
US$ |
|
US$
|
|
Revenue from external customers |
2,098,150 |
|
3,572,647 |
|
1,168,998 |
|
6,839,795 |
|
|
|
|
|
|
|
|
|
|
Revenue |
2,098,150 |
|
3,572,647 |
|
1,168,998 |
|
6,839,795 |
|
|
|
|
|
|
|
|
|
|
Operating profit |
212,455 |
|
361,686 |
|
118,345 |
|
692,486 |
|
Net finance gains Impairment loss on goodwill |
|
|
|
|
|
|
191,427 (54,604) |
|
Share of loss of an associate |
|
|
|
|
|
|
(78,955) |
|
Share of loss of a jointly controlled entity |
|
|
|
|
|
|
(49,597) |
|
|
|
|
|
|
|
|
|
|
Profit before taxation |
|
|
|
|
|
|
700,757 |
|
Taxation |
|
|
|
|
|
|
(21,000) |
|
|
|
|
|
|
|
|
|
|
Profit for the year |
|
|
|
|
|
|
679,757 |
Other segment items included in the income statement for the year ended 31 December 2009:
|
|
North |
|
|
|
Rest of the |
|
|
|
|
|
America |
|
EMEA |
|
World |
|
Total |
|
|
|
US$ |
|
US$ |
|
US$ |
|
US$ |
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation |
13,213 |
|
23,093 |
|
58,460 |
|
94,766 |
|
|
Amortisation |
1,700 |
|
1,751 |
|
39,558 |
|
43,009 |
|
|
Bad debts written off |
- |
|
- |
|
35,622 |
|
35,622 |
|
Information regarding segment assets and liabilities as at 31 December 2009 and capital expenditure for the year then ended, based on the locations of customers:
|
|
North |
|
|
|
Rest of the |
|
|
|
|
America |
|
EMEA |
|
World |
|
Total |
|
|
US$ |
|
US$ |
|
US$ |
|
US$ |
|
|
|
|
|
|
|
|
|
|
Total assets |
137,774 |
|
29,474 |
|
10,015,000 |
|
10,182,248 |
|
|
|
|
|
|
|
|
|
|
Total liabilities |
196,673 |
|
- |
|
3,528,007 |
|
3,724,680 |
|
|
|
|
|
|
|
|
|
|
Tangible assets additions |
54,488 |
|
9,500 |
|
24,892 |
|
88,880 |
|
Intangible assets additions |
8,193 |
|
1,560 |
|
9,644 |
|
19,397 |
|
|
|
|
|
|
|
|
|
|
Total capital expenditure |
62,681 |
|
11,060 |
|
34,536 |
|
108,277 |
The directors considered that there is no material difference in the information regarding segment assets and liabilities as at 31 December 2009 and capital expenditure for the year then ended, either based on the locations of customers or the locations of assets, no further disclosure is presented.
Segmental information for the year ended 31 December 2008:
|
|
North |
|
|
|
Rest of the |
|
|
|
|
America |
|
EMEA |
|
World |
|
Total |
|
|
US$ |
|
US$ |
|
US$ |
|
US$ |
|
Revenue from external customers |
2,616,339 |
|
2,350,482 |
|
1,385,703 |
|
6,352,524 |
|
|
|
|
|
|
|
|
|
|
Revenue |
2,616,339 |
|
2,350,482 |
|
1,385,703 |
|
6,352,524 |
|
|
|
|
|
|
|
|
|
|
Operating profit |
38,541 |
|
34,624 |
|
20,412 |
|
93,577 |
|
Net finance costs |
|
|
|
|
|
|
(507,795) |
|
Share of loss of an associate |
|
|
|
|
|
|
(24,041) |
|
Share of loss of a jointly controlled entity |
|
|
|
|
|
|
(150,403) |
|
|
|
|
|
|
|
|
|
|
Loss before taxation |
|
|
|
|
|
|
(588,662) |
|
Taxation |
|
|
|
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
Loss for the year |
|
|
|
|
|
|
(588,662) |
Other segment items included in the income statement for the year ended 31 December 2008:
|
|
North |
|
|
|
Rest of the |
|
|
|
|
America |
|
EMEA |
|
World |
|
Total |
|
|
US$ |
|
US$ |
|
US$ |
|
US$ |
|
|
|
|
|
|
|
|
|
|
Depreciation |
17,471 |
|
4,311 |
|
79,951 |
|
101,733 |
|
Amortisation |
11,179 |
|
273 |
|
36,351 |
|
47,803 |
|
Bad debts written off |
59,650 |
|
- |
|
22,343 |
|
81,993 |
Information regarding segment assets and liabilities as at 31 December 2008 and capital expenditure for the year then ended, based on the locations of customers:
|
|
North |
|
|
|
Rest of the |
|
|
|
|
America |
|
EMEA |
|
World |
|
Total |
|
|
US$ |
|
US$ |
|
US$ |
|
US$ |
|
|
|
|
|
|
|
|
|
|
Total assets |
159,516 |
|
7,564 |
|
8,896,286 |
|
9,063,366 |
|
|
|
|
|
|
|
|
|
|
Total liabilities |
87,520 |
|
- |
|
3,223,525 |
|
3,311,045 |
|
|
|
|
|
|
|
|
|
|
Tangible assets additions |
3,803 |
|
3,398 |
|
36,294 |
|
43,495 |
|
Intangible assets additions |
10,839 |
|
766 |
|
45,223 |
|
56,828 |
|
|
|
|
|
|
|
|
|
|
Total capital expenditure |
14,642 |
|
4,164 |
|
81,517 |
|
100,323 |
The directors considered that there is no material difference in the information regarding segment assets and liabilities as at 31 December 2008 and capital expenditure for the year then ended, either based on the locations of customers or the locations of assets, no further disclosure is presented.
The Group's business segments include software licensing, hosting, support and maintenance and software customisation and implementation. These business segments are the basis on which the Group reports its secondary segment information, as presented below:
Segmental information for the year ended 31 December 2009:
|
|
Software licensing |
|
Hosting |
Support and maintenance |
Software customisation and implementation |
|
Total |
||
|
|
US$ |
|
US$ |
|
US$ |
|
US$ |
|
US$ |
|
|
|
|
|
|
|
|
|
|
|
|
Segment revenue from external customers |
2,574,937 |
|
2,687,848 |
|
1,127,230 |
|
449,780 |
|
6,839,795 |
|
|
|
|
|
|
|
|
|
|
|
|
Total capital expenditure |
40,765 |
|
42,549 |
|
17,844 |
|
7,119 |
|
108,277 |
|
|
|
|
|
|
|
|
|
|
|
|
Total carrying amounts of segment assets |
3,833,252 |
|
4,001,337 |
|
1,678,082 |
|
669,577 |
|
10,182,248 |
|
|
|
|
|
|
|
|
|
|
|
Segmental information for the year ended 31 December 2008:
|
|
Software licensing |
|
Hosting |
|
Support and maintenance |
|
Software customisation and implementation |
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
US$ |
|
US$ |
|
US$ |
|
US$ |
|
US$ |
|
Segment revenue from external customers |
2,986,803 |
|
2,139,048 |
|
892,602 |
|
334,071 |
|
6,352,524 |
|
|
|
|
|
|
|
|
|
|
|
|
Total capital expenditure |
47,172 |
|
33,779 |
|
14,095 |
|
5,277 |
|
100,323 |
|
|
|
|
|
|
|
|
|
|
|
|
Total carrying amounts of segment assets |
4,261,375 |
|
3,051,854 |
|
1,273,506 |
|
476,631 |
|
9,063,366 |
|
|
|
|
|
|
|
|
|
|
|
7. SHARE CAPITAL
|
|
|
2009 |
|
2008 |
||||
|
|
|
Number of |
|
|
|
Number of |
|
|
|
|
|
shares |
|
US$ |
|
shares |
|
US$ |
|
|
|
|
|
|
|
|
|
|
|
Authorised: |
|
|
|
|
|
|
|
|
|
Ordinary shares at US$0.001 each |
|
100,000,000 |
|
100,000 |
|
100,000,000 |
|
100,000 |
|
|
|
|
|
|
|
|
|
|
|
Allotted, called up and fully paid: |
|
|
|
|
|
|
|
|
|
Ordinary shares |
|
25,013,576 |
|
25,014 |
|
24,913,576 |
|
24,914 |
|
|
|
|
|
|
|
|
|
|
|
Movements in ordinary shares |
|
|
|
|
|
|
|
|
|
At 1 January |
|
24,913,576 |
|
24,914 |
|
24,863,576 |
|
24,864 |
|
Shares issued to non-executive directors |
|
100,000 |
|
100 |
|
50,000 |
|
50 |
|
|
|
|
|
|
|
|
|
|
|
At 31 December |
|
25,013,576 |
|
25,014 |
|
24,913,576 |
|
24,914 |
|
|
|
|
|
|
|
|
|
|
The Group's primary objectives when managing capital are to safeguard the Group's ability to continue as a going concern, so that it can continue to provide returns for shareholders and benefits for other stakeholders, by pricing products and services commensurately with the level of risk and by securing access to finance at a reasonable cost.
The Group actively and regularly reviews and manages its capital structure to maintain a balance between the higher shareholder returns that might be possible with higher levels of borrowings and the advantages and security afforded by a sound capital position, and makes adjustments to the capital structure in light of changes in economic conditions.
The directors of the Company review the capital structure on a semi-annual basis. As part of this review, the directors consider the cost of capital and risks associates with each class of capital. Based on recommendations of the directors, the Group will balance its overall structure through the payment of dividends, new share issues and share repurchases as well as the issue of new debt or the redemption of existing debt.
8. EVENTS AFTER THE REPORTING PERIOD
The Group has been served a complaint for patent infringement within the United States on 25 March 2010 by the US District Court, Eastern District of Texas, Tyler Division. The plaintiff is IpLearn LLC, a California Limited Liability Company, and is against eight defendants which include the Group.
The directors believe that there has been no patent infringement, but take any such complaints seriously. The directors are therefore investigating the claims with a view to instructing legal advisers, together with the co-defendants, to challenge the complaint. The Company will announce any further developments in due course.
The Company's annual report will be sent to shareholders shortly and is available on the Company's website www.netdimensions.com.
Related Shares:
NETD.L