30th Sep 2009 07:00
MediLink-Global UK Limited
HALF-YEARLY REPORT for the six months to 30 june 2009
MediLink-Global UK Limited ("MediLink" or "the Company"), the provider of electronic healthcard network services to insurance companies and corporate organisations to facilitate the administration of medical claims and healthcare data management, announces its interim results for the six months ended 30 June 2009 that are in line with the management's expectations.
Financial Highlights
Revenue increased to £673,000 (2008: £112,000);
Contribution from China operations grew 6 times to 7% of total revenue to £44,000;
Maiden revenue contribution from Singapore operations of £157,000; and
Operating loss of (£427,000) (2008: £14,000 profit), mainly due to costs of expansion in China and £136,000 unrealised forex loss.
Operational Highlights
Norman Lott, Chairman of MediLink, commented: "We are extremely pleased to report MediLink's successful expansion into China which we said was our intention when we floated on AIM in November 2008. We are delighted with the number of agreements signed with insurance companies, especially with global brands like AXA Winterthur and AVIVA-COFCO and we are confident these agreements will translate into strong revenue in 2010. I am also very pleased that Lifeinc is now making a material contribution to the group's revenue and with the maiden contract win in Thailand, feel these initiatives are a reflection of the Company's strategy to provide our services throughout SE Asia."
Enquiries:
|
MediLink-Global UK Limited |
Broker |
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Shia Kok Fat, Chief Executive Officer |
SVS Securities Plc |
|
Tel: 00 603 2296 3028 |
Ian Callaway, Head of Corporate Broking |
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www.medilink-global.com |
Tel: 020 7382 2870 |
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Nominated Adviser |
Financial Public Relations |
|
Dowgate Capital Advisers Limited |
Walbrook PR Limited |
|
Lindsay Mair/Jo Turner |
Ben Knowles / Helen Westaway |
|
Tel: 020 7492 4777 |
Tel: 020 7933 8788/90 or Mob. 07900 346 978 |
|
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|
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|
Chairman's Statement
Medilink-Global UK Limited (together with subsidiaries, the "Group") is pleased to present the Group's unaudited first half interim results for the six month period ended 30 June 2009.
FINANCIAL REVIEW
The Group recorded revenues of £673,000 and a loss after tax of £441,000 for the six months ended 30 June 2009. Revenues have increased substantially over the same period last year with the introduction of the Lifeinc business in Singapore, while the core business in Malaysia has grown by 450%. The Malaysian operating entities contributed 70% of the Group revenue but contributions from the Singapore and China operations at 23% and 7% respectively are now making an impact on the business. The operating loss for the period was in line with expectations but the results were distorted by an unrealised foreign exchange loss of £136,000 as a result of the weakening of the Malaysian Ringgit against Sterling. Other factors contributing to the loss were the amortisation of intangible assets of £34,000, the share of loss of the associated company in Thailand of £20,000 and the high operating costs in China in tandem with the accelerated pace of expansion. In comparison to last year the Group has incurred additional costs in the UK this year following its admission to AIM as you would expect for a quoted company.
PERIOD IN FOCUS
The first half of 2009 has been an exciting period for the China operations as witnessed by the successful signing of new Third Party Administrator ("TPA") contracts with three insurance companies. Up to date, we have secured TPA contracts with eight insurance companies in China. In March 2009, the issued and paid up share capital of Medilink (Beijing) TPA Services Co Ltd had been increased from £88,075 to £304,081 in order to fund the expanding operations.
In April 2009 the Group acquired Lifeinc Holdings, a Singapore TPA company bringing with it an existing network of over 160 clinics and hospitals thereby making it immediately earnings enhancing. It is hoped that the acquisition will not only make a positive contribution to the Group's net profit but that it will also raise Medilink's profile in a country where many pan-Asian insurance companies have their headquarters.
Operations in Malaysia remained profitable during the period and we are in the process of implementing the ECCS (Electronic Claims Clearance System) in Singapore and expect to phase out the dated existing system by the end of the year.
The customisation of the ECCS for Thailand market shall be completed before the end of the third quarter of 2009 and 237 Electronic Data Capture (EDC) terminals have been deployed in various cities throughout Thailand.
PROSPECTS
While the Group is actively seeking to formalise strategic alliances with established TPA's in other regions and countries, its main focus is to consolidate its position and concentrate in expanding its revenues through offering its range of services to insurance companies and corporate clients via the use of "ECCS" and the "EDC" healthcare provider network in its existing territories with a particular emphasis on China, Singapore and Thailand. With the positive progress achieved from our market development activities in China as well as in Singapore and Thailand, the Directors believe that the Group's second half 2009 financial performance will improve significantly.
Norman Lott
Chairman
Consolidated Statement of Comprehensive Income
Period ended 30 June 2009
|
Period |
Period |
Year |
||
|
Ended 30.06.09 |
Ended 30.06.08 |
Ended 31.12.08 |
||
|
Unaudited |
Unaudited |
Audited |
||
|
Note |
£'000 |
£'000 |
£'000 |
|
|
Revenue |
5 |
673 |
112 |
578 |
|
Cost of sales |
(300) |
(29) |
(360) |
|
|
Gross profit |
373 |
83 |
218 |
|
|
Other income |
- |
- |
63 |
|
|
Administrative expenses |
(800) |
(69) |
(292) |
|
|
Operating (loss)/profit |
(427) |
14 |
(11) |
|
|
Share of associated undertakings' losses |
(20) |
(1) |
(23) |
|
|
Finance expenses |
(1) |
(1) |
(4) |
|
|
(Loss)/profit before taxation |
(448) |
12 |
(38) |
|
|
Taxation |
4 |
7 |
(6) |
(7) |
|
(Loss)/profit after taxation and for the period |
(441) |
6 |
(45) |
|
|
Other Comprehensive Income |
||||
|
Exchange differences on translating foreign operations |
46 |
21 |
(34) |
|
|
Total comprehensive income for the period net of tax |
(395) |
27 |
(79) |
|
|
Loss per share (pence) |
||||
|
Basic |
2 |
(0.43) |
0.05 |
(0.07) |
|
Diluted* |
2 |
(0.43) |
0.05 |
(0.07) |
* In accordance with IAS33 "Earnings per share" and where the Group has reported a loss for the period, the shares are not dilutive. The Group have not issued any instrument with dilutive effect.
Consolidated Statement of Financial Position
As at 30 June 2009
|
30.06.09 |
30.06.08 |
31.12.08 |
||
|
Note |
Unaudited |
Unaudited |
Audited |
|
|
£'000 |
£'000 |
£'000 |
||
|
Non-current assets |
||||
|
Intangible assets |
6 |
4,456 |
4,327 |
4,282 |
|
Property, plant and equipment |
244 |
52 |
223 |
|
|
Investments |
35 |
43 |
20 |
|
|
Total non-current assets |
4,735 |
4,422 |
4,525 |
|
|
Current assets |
||||
|
Inventories |
- |
- |
51 |
|
|
Trade and other receivables |
704 |
393 |
403 |
|
|
Cash and cash equivalents |
469 |
93 |
1,156 |
|
|
Total current assets |
1,173 |
486 |
1,610 |
|
|
Current liabilities |
||||
|
Trade and other payables |
463 |
299 |
277 |
|
|
Borrowings |
17 |
17 |
17 |
|
|
Total current liabilities |
480 |
316 |
294 |
|
|
Net current assets |
693 |
170 |
1,316 |
|
|
Non-current liabilities |
||||
|
Borrowings |
3 |
13 |
14 |
|
|
Other payables |
10 |
11 |
12 |
|
|
Deferred tax liabilities |
4 |
44 |
41 |
49 |
|
Total non-current liabilities |
57 |
65 |
75 |
|
|
Net assets |
5,371 |
4,527 |
5,766 |
|
|
Equity |
||||
|
Share capital |
5,167 |
4,500 |
5,167 |
|
|
Share premium account |
678 |
- |
678 |
|
|
Reserves |
(474) |
27 |
(79) |
|
|
Total equity |
5,371 |
4,527 |
5,766 |
Consolidated Statement of Cash Flows
Six months ended 30 June 2009
|
30.06.09 |
30.06.08 |
31.12.08 |
|
|
Unaudited |
Unaudited |
Audited |
|
|
£'000 |
£'000 |
£'000 |
|
|
Cash flows from operating activities |
|||
|
(Loss)/profit before taxation |
(448) |
12 |
(38) |
|
Adjustments for: |
|||
|
Amortisation of intangible assets |
34 |
- |
45 |
|
Depreciation of property, plant and equipment |
52 |
- |
22 |
|
Share of loss of associated company |
20 |
1 |
23 |
|
Finance costs |
1 |
1 |
4 |
|
Cash from operating activities before changes in working capital |
(341) |
14 |
56 |
|
Decrease / (increase) in inventories |
51 |
- |
(51) |
|
(Increase)/decrease in trade and other receivables |
(301) |
72 |
62 |
|
Increase/(decrease) in trade and other payables |
194 |
(54) |
(38) |
|
Cash flow from operations |
(397) |
32 |
29 |
|
Tax paid |
(7) |
(2) |
(32) |
|
Interest paid |
(1) |
(1) |
(4) |
|
Net cash flow from operations |
(405) |
29 |
(7) |
|
Investing activities |
|||
|
Purchase of property, plant and equipment |
(73) |
- |
(193) |
|
Cash & cash equivalents of subsidiaries at the date of acquisition |
- |
91 |
91 |
|
Acquisition of a subsidiary |
(208) |
- |
- |
|
Investment in associated company |
(35) |
(43) |
(43) |
|
Cash flow used in investing activities |
(316) |
48 |
(145) |
|
Financing activities |
|||
|
Proceeds from issue of shares |
- |
- |
2,399 |
|
Share issue costs |
- |
- |
(1,054) |
|
Repayment of bank borrowings |
(10) |
(2) |
(2) |
|
Repayment of hire purchase liabilities |
(2) |
(3) |
(1) |
|
Cash flow from financing activities |
(12) |
(5) |
1,342 |
|
Net increase/(decrease) in cash and cash equivalents |
(733) |
72 |
1,190 |
|
Effect of exchange rate changes |
46 |
21 |
(34) |
|
Cash and cash equivalents at the beginning of the period |
1,156 |
- |
- |
|
Cash and cash equivalents at the end of the period |
469 |
93 |
1,156 |
|
Consolidated Statement of Changes in Shareholder' Equity
|
|||||||||
|
Period ended 30 June 2009
|
|
|
|
|
|||||
|
Unaudited
|
|
|
|
Share
|
Share
|
Foreign exchange
|
|
Retained
|
|
|
|
|
|
|
capital
|
premium
|
reserve
|
|
earnings
|
Total
|
|
|
|
|
|
£’000
|
£’000
|
£’000
|
|
£’000
|
£’000
|
|
As at 1 January 2008
|
-
|
-
|
-
|
|
-
|
-
|
|||
|
Share capital issued in the period
|
5,167
|
1,732
|
-
|
|
-
|
6,899
|
|||
|
Share issue costs
|
|
|
-
|
(1,054)
|
-
|
|
-
|
(1,054)
|
|
|
Total comprehensive income for the period
|
|
|
-
|
-
|
(34)
|
|
(45)
|
(79)
|
|
|
|
|
|
|
|
|
|
|||
|
Balance as at 31 December 2008
|
5,167
|
678
|
(34)
|
|
(45)
|
5,766
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income for the period
|
|
|
|
-
|
-
|
46
|
|
(441)
|
(395)
|
|
Balance as at 30 June 2009
|
|
|
|
5,167
|
678
|
12
|
|
(486)
|
5,371
|
|
|
|
|
|
|
|
|
|
|
|
|
Period ended 30 June 2008
|
|
|
|
|
|||||
|
|
|
|
|
Share
|
Share
|
Foreign exchange
|
|
Retained
|
|
|
|
|
|
|
capital
|
premium
|
reserve
|
|
earnings
|
Total
|
|
|
|
|
|
£’000
|
£’000
|
£’000
|
|
£’000
|
£’000
|
|
As at 1 January 2008
|
-
|
-
|
-
|
|
-
|
-
|
|||
|
Share capital issued in the period
|
4,500
|
-
|
-
|
|
-
|
4,500
|
|||
|
Total comprehensive income for the period
|
|
|
-
|
-
|
21
|
|
6
|
27
|
|
|
|
|
|
|
|
|
|
|||
|
Balance as at 30 June 2008
|
4,500
|
-
|
21
|
|
6
|
4,527
|
|||
|
|
|
|
|
|
|
|
|
|
|
Notes to the Financial Information
Period ended 30 June 2009
1 Basis of preparation
The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union. The principal accounting policies used in preparing the interim results are those the group expects to apply in its financial statements for the year ended 31 December 2009 and are unchanged from those disclosed in the group's Report and Financial Statements for the year ended 31 December 2008 except for the impact of the Standards and Interpretations described below:
Revised IFRS 8 Operating Segments - effective for annual periods beginning or after 1 January 2009. IFRS 8 is a disclosure standard that has resulted in a re-designation of the Group's reportable segments, but has no impact on the reported results or financial position of the Group.
IAS 1 (revised 2007) Presentation of Financial Statements - effective for annual periods beginning on or after 1 January 2009. IAS 1 (revised 2007) presents transactions with owners in detail and non-owner changes in equity as a single line in the statement of changes in equity. The standard introduces a Condensed Consolidated Statement of Comprehensive Income which presents all items of unrecognised income and expense and is linked to the Consolidated Income Statement. In addition, the Consolidated Balance Sheet has been renamed to Condensed Consolidated Statement of Financial Position and the Consolidated Cash Flow Statement has been renamed to Condensed Consolidated Statement of Cash Flows.
The Interim Results have not been audited by the Company's auditors. The comparatives for the period ended 31 December 2008 are not the Company's full statutory accounts for that period. A copy of the statutory accounts for that period, which were prepared under IFRS, have been delivered to the Registrar of Companies. The auditors' report on those accounts was unqualified.
Whilst the financial information included in this Interim Financial information has been prepared in accordance with the recognition and measurement criteria of IFRS, it does not include sufficient information to comply with IFRS.
The financial information set out in this announcement was approved by the board on 28 September 2009.
2 Basic and diluted loss per ordinary share
Basic loss per share is calculated by dividing the loss attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the period. In accordance with IAS 33 and where the Group has reported a loss for the period the shares are not diluted.
|
30.06.09 |
30.06.08 |
31.12.08 |
|
|
|
£'000 |
£'000 |
£'000 |
|
(Loss)/profit after taxation |
(441) |
6 |
(45) |
|
|
|
|
|
|
Basic weighted average shares in issue |
103,330,630 |
12,803,145 |
60,057,432 |
|
Diluted weighted average shares in issue |
103,330,630 |
12,803,145 |
60,057,432 |
|
|
|
|
|
|
Basic (loss)/profit per share based on issued share capital as at 30 June 2009 (pence) |
(0.43) |
0.05 |
(0.07) |
|
Diluted (loss)/profit per share based on issued share capital as at 30 June 2009 (pence) |
(0.43) |
0.05 |
(0.07) |
|
|
|
|
3 Dividend
The Directors do not propose a dividend.
4 Taxation
The interim tax credit reflects an estimate of the likely effective tax rate for the period.
5 Turnover and segmental analysis
The directors consider that the Group's activities represent a single class of business. The operating segments the Group's by geographical origin is set out below:
|
Period ended 30 June 2009 |
Period ended 30 June 2008 |
Period ended 31 December 2008 |
|
|
£'000 |
£'000 |
£'000 |
|
|
Turnover |
|||
|
Malaysia |
472 |
105 |
549 |
|
Singapore |
157 |
- |
- |
|
China |
44 |
7 |
29 |
|
673 |
112 |
578 |
|
|
Gross profit |
|||
|
Malaysia |
350 |
80 |
201 |
|
Singapore |
13 |
- |
- |
|
China |
10 |
3 |
17 |
|
373 |
83 |
218 |
|
|
(Loss)/profit after tax for the period |
|||
|
Jersey |
(179) |
- |
5 |
|
Malaysia |
(1) |
49 |
38 |
|
Singapore |
(83) |
(1) |
13 |
|
China |
(178) |
(42) |
(101) |
|
(441) |
6 |
(45) |
|
|
Carrying amount of assets |
|||
|
Jersey |
4,829 |
4,328 |
5,376 |
|
Malaysia |
714 |
501 |
624 |
|
Singapore |
143 |
56 |
48 |
|
China |
222 |
23 |
87 |
|
5,908 |
4,908 |
6,135 |
|
Liabilities |
|||
|
Jersey |
48 |
41 |
71 |
|
Malaysia |
212 |
172 |
256 |
|
Singapore |
183 |
150 |
14 |
|
China |
94 |
18 |
27 |
|
537 |
381 |
369 |
|
|
Additions to plant, property and equipment |
|||
|
Malaysia |
31 |
- |
190 |
|
Singapore |
6 |
- |
- |
|
China |
12 |
- |
3 |
|
49 |
- |
193 |
|
|
Depreciation and amortisation |
|||
|
Malaysia |
44 |
- |
19 |
|
Singapore |
1 |
- |
- |
|
China |
7 |
- |
3 |
|
52 |
- |
22 |
6 Share capital
MGL have one class of ordinary share capital which carry no rights to fixed income, any preferences or restrictions.
Authorised share capital:
|
|
2009
|
|
|
£’000
|
|
Authorised:
|
|
|
200,000,000 Ordinary shares of 5p each
|
10,000
|
|
Issued:
|
|
|
103,330,630 Ordinary shares of 5p each
|
5,167
|
|
|
|
7 Acquisition of Lifeinc Holdings Pte Ltd
On 8 January 2009, the Group entered into a arrangement to acquire 100% of a Third Party Administrator ("TPA") company in Singapore with purchase consideration of SGD500,000. The purchase consideration shall be satisfied as follows: -
(i) SGD50,000 in cash was paid in January 2009
(ii) SGD250,000 in cash was paid in April 2009
(iii) The Company had in July 2009 issued 535,217 new shares of £0.05 each at £0.18 per share
to vendors as full settlement of the balance purchase consideration of SGD200,000.
|
Purchase consideration |
SGD |
|
Cash |
300,000 |
|
Shares |
200,000 |
|
Total purchase consideration |
500,000 |
|
Fair value of net assets acquired |
(2) |
|
Intangible fixed assets acquired |
(236,854) |
|
Deferred tax |
- |
|
Goodwill |
263,144 |
|
Acquisition of subsidiaries, net of cash and cash equivalents acquired |
SGD |
|
Property, plant and equipment |
- |
|
Trade and other receivables |
- |
|
Cash and cash equivalents |
2 |
|
Trade and other payables |
- |
|
Net total asset acquired |
2 |
|
Deferred tax |
- |
|
Total consideration |
500,000 |
|
Payment through shares |
(200,000) |
|
Cash consideration |
300,000 |
|
Cash payment made in the previous year |
- |
|
Cash consideration paid during the year |
300,000 |
|
Cash and cash equivalents acquired |
(2) |
|
Acquisition of subsidiaries, net of cash and cash equivalents acquired |
299,998 |
8 Foreign currency exchange rate
The following significant exchange rates applied during the period:
|
Average Rate |
Reporting Date |
|
|
£1 : RMB |
9.7299 |
11.0747 |
|
£1 : SGD |
2.1615 |
2.4013 |
|
£1 : RM |
5.1898 |
5.8372 |
9 Nature of financial information
These interim results will be available on the Company's website, www.medilink-global.com. Further copies can be obtained from the registered office at 31 Pier Road, St. Helier, Jersey, JE4 8PW.
- Ends -
Related Shares:
MEDI.L