29th Dec 2009 07:00
29 December 2009 Avia Health Informatics plc ("Avia" or "the Company") Interim results for the six months ended 30 September 2009
Avia (AIM: AVIA), the developer and provider of clinical decision support systems worldwide, is pleased to announce its interim results for the six months ended 30 September 2009.
These are the first results to be published since joining AIM in November 2009.
Highlights - post period
* Admission to AIM 16 November 2009 * Placing to raise 1.2 million * Acquisition of The Plain Software Company completed * Two contracts won since admission to AIM
Barry Giddings, Chairman, Avia Health Informatics commented:
"The acquisition of The Plain Software Company and the move to AIM transforms the business. The primary focus for the Company in the short to medium term is to expand its global reach by building on Plain's success in the UK and in addition to actively market and sell its products overseas.
"Since completing the acquisition we have won two new contracts and we look to increased market share over the coming months. We have also accelerated the development programme in order to introduce the new web-deployed products earlier in 2010 than originally planned.
"The Board is encouraged by the progress made since Plain was acquired and is optimistic regarding the prospects for the Company."
Enquiries:Avia Health Informatics plc Barry Giddings, Chairman 07770 747 818Nigel Leavy, Finance Director 07540 014 503
Merchant John East Securities Limited (Nominated Adviser and Broker) Simon Clements/Bidhi Bhoma
020 7628 2200 Lothbury Financial (Financial PR) Gary Middleton/Michael Padley 020 7011 9411Chairman's StatementIntroduction
The Company was incorporated on 11 January 2008 and was admitted to PLUS Markets on 25 March 2008.
The principal activity of the Company is the acquisition and operation of businesses in the healthcare technology sector.
As this is my first Chairman's statement for Avia Health Informatics Plc since we completed the acquisition of The Plain Software Company Limited ("Plain"), the 1.2 million placing and admission to trading on AIM, I thought it would be helpful if I set out the background to this transaction.
Acquisition of Plain
The Company entered into agreement to acquire Plain in late 2008 and after a false start relating to an aborted fundraising effort in early 2009, which was primarily due to extremely difficult trading conditions across all financial markets, the Company concluded a placing of 1.2 million with institutional and retail investors in November 2009.
The consideration for the acquisition of Plain was approximately 1.6 million which was satisfied as to 105,000 in cash and the balance by the issue of 2,501,662 new ordinary shares in the capital of the Company. Simultaneously with the acquisition the Company raised approximately 1.2 million, before expenses, by the issue of 1,975,100 new ordinary shares at 60 pence per share and moved from Plus Markets onto AIM. The net proceeds from the placing will be applied to Plain's development and marketing plans and the Board believe the new funds available will allow Plain to accelerate its move into new markets, principally through the deployment of its software via the web and through a .Net platform.
It was pleasing to have completed the transaction especially after the problems experienced along the way and I was particularly encouraged by the commitment shown by the vendors, of Plain who chose to accept the majority of the consideration in shares. In addition, I would also like to thank the directors and staff of Plain and Avia for their strong participation in the placing.
Financial Performance
The results for the six months ended 30 September 2009 do not reflect the activities of Plain as the transaction was completed after the balance sheet date. We have chosen to include unaudited pro forma financial information for Plain in the notes to these accounts which will enable shareholders to see the financial performance of Plain in the period under review.
The Company did not trade in the period to 30 September 2009 and was focused on seeking suitable acquisition targets. The loss before and after taxation in the period was 66,383 (2008: 120,216). The net assets as at 30 September 2009 were 23,725 (2008: 288,011).
The next set of results will be for the year ended 31 March 2010 and these results will incorporate the trading activities of Plain.
Strategy
Avia's strategy is to seek to expand through a combination of the following:
* organic growth of Odyssey, Plain's Clinical Decision Support software * identification and acquisition of suitable related health informatics businesses or companies; * development of UK and International strategic partnerships; and * marketing and selling third party health informatics related products and/ or services in the UK and internationally.
The primary focus for the Company in the short to medium term is to expand its global reach by building on Plain's success in the UK and in addition to actively market and sell its products overseas. It is anticipated that this will be achieved through the development of added value partnerships and the ability to deploy Plain's Odyssey software via the web and on a .Net platform.
Plain will also continue to seek to grow sales of its traditional Odyssey product range into established markets whilst developing and delivering the Web-deployed Odyssey product range to new markets. It was originally envisaged that the Web-deployed range would be available in the last quarter of 2010 but I'm pleased to report that we now expect this to be in the 2nd/3rd quarter of 2010.
The acceleration of the timetable with respect to the development programme will allow Plain to commence the marketing and sale of these products at an earlier stage than previously envisaged, although it will also advance the costs associated with this programme such that they will now fall into the current financial year and be charged to the Income Statement.
The Board is encouraged by the progress made since Plain was acquired and as we enter our most important trading quarter of our financial year I look forward to updating you as to further progress early in 2010.
B S GiddingsChairman29 December 2009
Avia Health Informatics plc
Income Statement
For the six months ended 30 September 2009
Six months Six months Period from 11 ended ended January 2008 30 September 30 September to 31 March 2009 2008 2009 Unaudited Unaudited Audited GBP GBP GBP Administrative expenses (68,633) (102,583) (408,795) Operating loss (68,633) (102,583) (408,795) Finance income 2,250 367 8,403 Loss before taxation (66,383) (102,216) (400,392) Taxation - - -
Loss for the period attributable (66,383) (102,216) (400,392) to equity holders of the Company
Loss per share: 0.35p 0.57p 2.46p Basic and diluted Avia Health Informatics plcBalance SheetAs at 30 September 2009 As at As at As at 30 September 30 September 31 March 2009 2008 2009 Unaudited Unaudited Audited GBP GBP GBP Non-current assets Property, plant and equipment 1,772 3,597 2,373 Current assets 104,094 - 106,114 Trade and other receivables Cash and cash equivalents 11,734 321,894 28,724 115,828 321,984 134,838 Total assets 117,600 325,491 137,211 Current liabilities Trade and other payables 93,875 37,480 47,103 Total liabilities 93,875 37,480 47,103 Net assets 23,725 288,011 90,108 Equity 93,752 93,752 93,752 Share capital Share Premium 396,748 396,748 396,748 Retained earnings (466,775) (202,489) (400,392) Total Equity 23,725 288,011 90,108Avia Health Informatics plcCash Flow Statement
For the six months ended 30September 2009
Six months Six months Period from 11 ended ended January 2008 30 September 30 September to 31 March 2009 2008 2009 Unaudited Unaudited Audited GBP GBP GBP Net cash absorbed by operating (16,990) (56,514) (466,581)activities (note 1) Investing activities - 367 8,403 Interest received Purchase of property, plant and - (3,598) (3,598)equipment Net cash (absorbed by)/generated - (3,231) 4,805from investing activities Financing activities - 153,000 490,500 Proceeds from issue of share capital Net cash generated from financing - 153,000 490,500activities Net (decrease)/increase in cash (16,990) 93,255 28,724and cash equivalents Cash and cash equivalents at 28,724 228,639 -beginning of period Cash and cash equivalents at end 11,734 321,894 28,724of period
Notes to the condensed Avia Health Informatics plc interim financial statements
1 General Information
Avia Health Informatics plc is incorporated in the United Kingdom under the Companies Act 1985. These condensed consolidated financial statements are presented in Pounds Sterling because that is the currency of the primary economic environment in which the group operates.
The condensed consolidated interim financial statements do not constitute statutory accounts as defined in Section 435 of the Companies Act 2006.
The financial information for the period 11 January 2008 to 31 March 2009 has been extracted from the statutory accounts for that period. The auditors' report on the statutory accounts for the period ended 31 March 2009 was unqualified and did not contain a statement under S237 of the Companies Act 1985. The auditors' opinion did however include the following emphasis of matter paragraph in their report:
"In forming our opinion on the financial statements, which is not qualified, we have considered the disclosure in note 2 to the financial statements concerning the Company's ability to continue as a going concern. The Company is currently unable to pay its creditors as they fall due and is dependent on its success in raising new share capital to fund acquisitions to continue its activities. This indicates the existence of a material uncertainty which affects the Company's ability to continue operating as a going concern. The financial statements do not include any adjustments that would result if the Company was unable to continue as a going concern."
A copy of those accounts has been filed with the Registrar of Companies.
Since the auditors' report was issued the Company has issued further share capital by way of the placing referred to below which has provided sufficient working capital for the Company's current requirements.
2. Basis of preparation
The Company has presented its results in accordance with International Financial Reporting Standards as adopted in the EU ("IFRS") using the same accounting policies and methods of computation as were used in the annual financial statements for the period ended 31 March 2009. As permitted, the interim report has been prepared in accordance with the AIM Rules for companies and is not compliant in all respects with IAS 34 Interim Financial Statements. The condensed consolidated interim financial statements do not include all of the information required for full annual financial statements and cannot be construed to be in full compliance with IFRS.
3. Note to the cash flow statement
Reconciliation of loss before tax to cash absorbed by operating activities
Six months Six months Period from 11 ended ended January 2008 30 September 30 September to 31 March 2009 2008 2009 Unaudited Unaudited Audited GBP GBP GBP Operating loss for the period (68,633) (102,583) (408,795) Depreciation on property, plant and 601 - 1,225equipment
Operating cash flows before movements (68,032) (102,583) (407,570) in working capital
Decrease/(increase) in receivables 4,270 - (106,114) Increase in payables 46,772 46,068 47,103 Cash absorbed by operations (16,990) (56,515) (466,581)
4. Placing and acquisition of The Plain Software Company Limited
On 16 November 2009 the Company completed the Placing of 1,975,100 ordinary shares raising 1.185 million of new equity (less costs of 201,000) for the Company. On the same date the Company completed the acquisition of The Plain Software Company Limited by way of the issue of 2,501,662 shares in the Company and the payment of 105,000 in cash. The acquisition has the characteristics of a reverse acquisition within the meaning of International Financial Reporting Standard 3 and will be accounted for as such in preparing the financial statements of the Group for the year ended 31 March 2009. Under the reverse acquisition method of accounting The Plain Software Company Limited will be portrayed as the acquirer in presented the consolidated results of the Group.
5. Basis of preparation of the unaudited interim condensed financial
statements of The Plain Software Company Limited
The results of The Plain Software Company Limited for the six months ended 30 September 2009 are set out in the appendix attached.
The condensed consolidated interim financial statements set out in the appendix do not constitute statutory accounts as defined in Section 435 of the Companies Act 2006.
The financial information for the 13 months ended 31 March 2009 has been extracted from the statutory accounts for that period. The auditors' report on the statutory accounts for the period ended 31 March 2009 was unqualified and did not contain a statement under S237 of the Companies Act 1985. The auditors' opinion did however include the following emphasis of matter paragraph in their report:
"In forming our opinion on the financial statements which is not qualified, we have considered the adequacy of the disclosures in note 1 to the financial statements concerning the company's ability to continue as a going concern. The company incurred a net loss of 197,449 and at 31 March 2009 its liabilities exceeded its assets by 32,708.
The company is anticipating the injection of new equity capital, though there can be no certainty that their funds will be raised. This indicates the existence of a material uncertainty which may affect the Company's ability to continue as a going concern. The financial statements do not include any adjustments that would result if the company was unable to continue as a going concern."
Since the auditors issued their report The Plain Software Company Limited, as explained above, was acquired by Avia Health Informatics Limited , which raised sufficient working capital by way of a placing to fund the ongoing operations of The Plain Software Company Limited.
The Plain Software Company Limited has presented its results in accordance with International Financial Reporting Standards as adopted in the EU ("IFRS") using the same accounting policies and methods of computation as were used in the annual financial statements for the period ended 31 March 2009 and in the financial information included in the AIM Admission Document of the Company. The condensed interim financial information is not compliant in all respects with IAS 34 Interim Financial Statements. The condensed consolidated interim financial statements do not include all of the information required for full annual financial statements and cannot be construed to be in full compliance with IFRS.
6. Dividends
The Directors cannot recommend the payment of an interim dividend.
7. Copies of the Interim Results
Copies of this interim announcement will be available to download from the Company's website at http://www.ahi-plc.com and at the registered office, 16 Thorney Leys Business Park Witney Oxon OX28 4GE.
Appendix
Condensed interim financial statements of The Plain Software Company Limited
The Plain Software Company Limited
Income Statement
For the six months ended 30 September 2009
Unaudited Audited Six months ended 13 months ended 30 September 2009 31 March GBP 2009 GBP Revenue 938,925 1,878,008 Operating costs (540,918) (1,088,209) Trading profit 398,007 789,799 Administrative expenses (528,705) (1,017,239) Operating loss (130,698) (227,440) Finance income - 10,084 Finance costs (2,250) - Loss before tax (132,948) (217,356) Tax on loss on ordinary activities - 19,907
Loss for the period from continuing operations (132,948) (197,449)
The Plain Software Company Limited
Balance SheetAs at 30 September 2009 Unaudited Audited As at As at 31 30 September March 2009 2009 GBP GBP Non-current assets Plant and equipment 43,733 35,079 Intangible assets 95,206 31,141 138,939 66,220 Current assets Trade and other receivables 286,699 423,413 Current income tax asset 22,358 22,358 Cash and cash equivalents 30,544 198,585 339,601 644,356 Total assets 478,540 710,576 Current Liabilities Trade and other payables 211,997 279,460 Loan 102,250 100,000 Deferred income 329,949 363,824 644,196 743,284 Total assets less total liabilities (165,656) (32,708) Equity Share capital 1,641 1,641 Share premium account 219,731 219,731 Accumulated losses (387,028) (254,080) Total equity (165,656) (32,708)
The Plain Software Company Limited
Cash flow statement
For the six months ended 30 September 2009
Unaudited Audited Six months ended 13 months ended 30 September 31 March 2009 2009 GBP GBP Net cash outflows from operating activities (86,922) (242,178)(note 1) Investing activities Interest received - 10,084 Purchase of property, plant and equipment (17,054) (33,195) Purchase of intangible fixed assets (64,065) (31,141) Net cash used in investing activities (81,119) (54,252) Financing activities Short term loan advanced - 100,000 Net decrease in cash and cash equivalents (168,041) (196,430) Cash and cash equivalents at beginning of 198,585 395,015period Cash and cash equivalents at end of period 30,544 198,585
Notes to the condensed interim financial statements of The Plain Software Company Limited for the six months ended 30 September 2009
1. Reconciliation of loss before tax to cash absorbed by operating activities
Six months ended 13 months ended 30 September 31 March 2009 2009 GBP GBP Loss before tax (132,948) (217,356) Depreciation charges 8,400 14,268 Net finance cost/(income) 2,250 (10,084) Movements in working capital: Decrease/(increase) in trade and other 136,714 (250,688)receivables (Decrease)/increase in trade, other payables (101,338) 229,137and deferred income Cash absorbed by operations (86,922) (234,723) Interest paid - - Income taxes paid - (7,455) Net cash absorbed by operating activities (86,922) (242,178)
vendorRelated Shares:
CTFA.L