12th Apr 2007 07:01
Ultrasis PLC12 April 2007 12th April 2007 Ultrasis PLC Interim results for the six months ended 31st January 2007 Highlights • Turnover ahead 4.2% on the previous year at £692k (2006: £664k) • Secretary of State for Health announcement of introduction of cCBT in every PCT is a significant milestone in the development of the company • Strong sales in the third quarter and as NICE implementation proceeds we anticipate an increase of new sales of Beating the Blues in the second half • Development and launch of an online retail arm - www.thewellnessshop.co.uk Commenting, Nigel Brabbins, Chief Executive, said: "The positive developments of the last six months mark a significant milestonein the long term development of Ultrasis as a leading provider of cCBT in thepublic and private sectors, in both clinical and retail markets. Whilecontinuing to seek opportunities in other markets, our immediate priority willbe to deliver implementation of the NICE recommendations across PCTs inEngland." Further information: Ultrasis plc Nigel Brabbins +44 (0) 20 7566 3900 [email protected] www.ultrasis.comwww.thewellnessshop.co.uk Media enquiries: Capital MS&L Peter Curtain / James Madsen +44 (0) 20 7307 5330 [email protected] Statement from Chairman and Chief Executive The announcement by the Department of Health (DH) that Ultrasis had been invitedto talks to establish a National Framework Agreement for implementation of ourcore product, Beating the Blues (BtB), across the NHS was a milestone. However,the effect was to cause Primary Care Trusts (PCTs) to pause their purchases ofBtB until the outcome of the talks became clear. As a result new business growthwas restricted in the first 6 months, although BtB licence renewals, yourcompany's principal source of income, continued as anticipated. Financial Highlights - Results for the six months ended 31st January 2007 In the six months ended 31st January 2007, recognised revenue from ordinaryoperating activities grew to £692,000 from £664,000 in the same period lastyear. The loss for the period before share-based payments was £144,000 and£379,000 after share-based payments; January 2006: £95,000. Beating the Blues As reported on 28th March 2007 the Secretary of State for Health, PatriciaHewitt, confirmed that "over 2007/8 the establishment of cCBT in every PCT willbe an important building block in the delivery of comprehensive psychologicaltherapy services. Clinical evidence confirms that counselling and therapy arejust as effective as medication in helping to treat most cases of depression.The guidance being published today will give the NHS the information they needto provide these services". This is a significant milestone in achieving the board's objective of confirmingBtB as the market leader in the delivery of computer delivered cognitivebehavioural therapy (cCBT) in the UK. We are pleased to report strong sales in the third quarter. As NICEimplementation proceeds, we anticipate an increase of new sales of BtB in thesecond half. New developments There have been developments in other business areas, too. Following theacquisition of Healthstar group plc and the reacquisition of the retail rightsof BtB and its derivative products, Ultrasis, within existing resource,developed and launched an online retail arm - www.thewellnessshop.co.uk -selling directly to consumers a number of self-help programmes and products forthe relief of the increasingly recognised common problems, stress, anxiety,insomnia and depression. This provides a platform to retail BtB in the futureand focus on the long term development of the "wellness" brand. Operating overheads in the last six months rose £159,000, a: to strengthen theUltrasis team in anticipation of the need to deliver increased activity onconclusion of the National Framework Agreement, and b: to participate in newpublic sector initiatives, such as the Department of Work and Pensions programmeto reduce long term invalidity and developments in the corporate market. This isclear evidence that the value of therapies offered by Ultrasis is increasinglywell recognised. Conditions Management Programme As part of the DWP commissioned Pathways to Work (PTW) programme, ConditionsManagement represents a radical approach by the Government, offering to bothcommercial healthcare providers and the NHS the opportunity to provide bothmental health and vocational rehabilitation services to assist in getting peopleback to work. This service has traditionally been provided by the NHS but is nowopen to external providers and Ultrasis is currently involved with otherpartners in both Rounds 1 & 2, where services in a total of 30 authorities havebeen put out to tender. Corporate We continue to explore opportunities in the corporate market. Ultrasis'partnership with the Priory Group, one of Europe's leaders in mental healthprovision, where we jointly provide a range of mental health services forCroydon Primary Care Trust, is an example of the business opportunities in thisarea and both parties have committed to consider bidding on other projects,should the opportunity arise. The market The roll-out of BtB across PCTs in England enhances the status of all Ultrasisproducts and will assist in our marketing efforts in the USA. We willconcentrate on opportunities to build on existing productive relationships, suchas with Managed Health Networks (MHN), but are prepared to terminate nonproductive relationships, one such being with HealthMedia Inc, to focus on newopportunities which are emerging. A proven product Further evidence of the efficacy of BtB was enhanced by the publication of anopen study in routine care, demonstrating that BtB was as effective as face toface therapy. Furthermore, an analysis (to be published) of 600 patients in aspecialist CBT centre in Chelmsford showed that after using BtB, 7 out of 10patients needed no further intervention. Conclusion The positive developments of the last six months mark a significant milestone inthe long term development of your company as a leading provider of cCBT in thepublic and private sectors, in both clinical and retail markets. Whilecontinuing to seek opportunities in other markets, the company's immediatepriority will be to deliver implementation of the NICE recommendations acrossPCTs in England, building on the strong sales in the third quarter. We thank the Ultrasis team for the achievements of the past six months and ouradvisers, too, for their input. Nigel BrabbinsChief Executive Gerald MaloneNon Executive Chairman Consolidated Profit and Loss Account For the six months ended 31st January 2007 Six months Six months Year ended ended ended 31st January 31st January 31st July Notes 2007 2006 2006 (unaudited) (unaudited) (audited) AS RESTATED £'000 £'000 £'000 Turnover 2 692 664 1,243Cost of sales (9) - (17) Gross profit 683 664 1,226 Administration expenses- Share based payments - (share options granted Mar 7 (235) - (175)*2006)- other (836) (677) (1414) (1,071) (677) (1,589)* Operating loss Before share options (153) (13) (188) Share based payments - (share options granted March 7 (235) - (175)*2006) (388) (13) (363)* Loss on the disposal of fixed assets - - (10) Loss on ordinary activities before interest (388) (13) (373)*Finance charges (net) 9 (82) (79)Loss on ordinary activities before taxation 2 (379) (95) (452)*Tax on loss on ordinary activities - - (2)Loss on ordinary activities after taxation (379) (95) (454)*Loss for the period (379) (95) (454)*Basic and diluted loss per share (p) 3 (0.026) (0.007)p (0.033)* Results for the period all resulted from continuing operations \* The audited figures for the year ended 31st July 2006 have been restated toaccount for the introduction of FRS 20 which requires share-based payments suchas the share options granted in March 2006 to be accounted for in the Profit andLoss account. Consolidated balance sheet At 31st January 2007 31st January 31st January 31st July Notes 2007 2006 2006 (unaudited) (unaudited) (audited) AS RESTATED £'000 £'000 £'000Fixed assetsIntangible assets 2,497 - 2,497Tangible assets 37 38 43 2,534 38 2,540Current assetsStock 28 28Debtors - due within one year 301 505 429Cash at bank and in hand 593 339 872 922 844 1,329 Creditors: amounts falling due within one year (866) (778) (1,029) Net current assets 56 66 300 Total assets less current liabilities 2,590 104 2,840Creditors : amounts falling due after more than one - - (96)year Net assets 2 2,590 104 2,744 Capital and reservesCalled up share capital 1,478 1,330 1,478Share premium account 4 21,104 20,745 21,104Merger reserve 4 2,324 - 2,324Share option reserve 4 410 - 175*Other reserves 4 6,650 6,650 6,650Profit and loss account 4 (29,376) (28,621) (28,987)*Shareholders' funds 2,590 104 2,744* \* The audited figures for the year ended 31st July 2006 have been restated toaccount for the introduction of FRS 20 which requires share-based payments suchas the share options granted in March 2006 to be accounted for in the Profit andLoss account. Consolidated cash flow statement For the six months ended 31st January 2007 Six months Six months Year ended ended Ended 31st January 31st January 31st July 2007 2006 2006 (unaudited) (unaudited) (audited) AS RESTATED Notes £'000 £'000 £'000 Net cash (outflow)/inflow from operating (287) (104) 292activities Returns on investments and servicing of finance 6 9 6 8Capital expenditure and financial investment 6 (1) (3) (10) Acquisitions 6 - - (93)Net cash (outflow)/inflow before management ofliquid resources and financing (279) (101) 197Financing - increase in ordinary share capital 6 - - 235 (Decrease) / increase in cash in the period (279) (101) 432 Reconciliation of net cash flow to movementin net funds / (debt)(Decrease) / increase in cash in the period (279) (101) 432 Movement in net debt in period (279) (101) 432Non-cash movement - 738 738 Movement in net funds (279) 637 1,170Net funds/(deficit) at beginning of period 5 872 (298) (298) Net funds at end of period 5 593 339 872 Reconciliation of operating loss to cash flow from operating activities Operating loss on ordinary activities (388) (13) (363)* Depreciation charge 6 12 19Fees settled in shares - - 145Share based payments 235 - 175*Decrease/(Increase) in debtors 128 (299) (223)(Decrease)/Increase in creditors (268) 196 539 Net cash flow from operating activities (287) (104) 292 \* The audited figures for the year ended 31st July 2006 have been restated toaccount for the introduction of FRS 20 which requires share-based payments suchas the share options granted in March 2006 to be accounted for in the Profit andLoss account. 1. Nature of financial information The financial information contained in this interim report does not constitutestatutory accounts as defined by Article 248(3) (c) in Part VIII of theCompanies (Northern Ireland) Order 1986. Statutory accounts for the year ended31st July 2006 have been reported on by the Company's auditors and delivered tothe Registrar of Companies in Northern Ireland. The report of the auditors wasunqualified and did not contain a statement under Article 245(4) of theCompanies (Northern Ireland) Order 1986. The results for the six months ended31st January 2007 and for the six months ended 31st January 2006 are neitheraudited nor reviewed by the Company's auditors. The interim financial statement has been prepared on a basis consistent with theaccounting policies disclosed in the Annual Report and Accounts for the yearended 31st July 2006 and also the new accounting policy applicable in thisperiod as described below. Share based payments The share option programme allows directors and staff to acquire shares of theCompany. The fair value of options granted after 7 November 2002 and those notyet vested as at the Company's effective date of FRS 20 (which is 1 January2006) is recognised as an employee expense with a corresponding increase inequity. The fair value is measured at grant date and spread over the periodduring which the employees become unconditionally entitled to the options. Thefair value of the options granted is measured using an option pricing model,taking into account the terms and conditions upon which the options weregranted. The amount recognised as an expense is adjusted to reflect the actualnumber of share options that vest. 2. Segment information The Company considers there to be only one class of business, interactivehealthcare. Geographical Segments United Kingdom Rest of the World Group Jan 2007 Jan 2006 Jan 2007 Jan 2006 Jan 2007 Jan 2006 £'000 £'000 £'000 £'000 £'000 £'000 (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited)Turnover bydestination: 524 469 168 195 692 664 ======== ======== ======= ======= ======== ======== Turnover by origin: 524 469 168 195 692 664 ======== ======== ======= ======= ======== ========(Loss)/profit onordinary activities before (364) (125) (15) 30 (379) (95) taxation ======== ======== ======= ======= ======== ========Net assets /liabilities 3,214 759 (624) (655) 2,590 104 ======== ======== ======= ======= ======== ======== 3. Basic and diluted loss per share The calculations of loss per share are based on the following loss and numbersof shares: Six months ended Six months ended Year ended 31st January 2007 31st January 2006 31st July 2006 AS RESTATED £'000 £'000 £'000 (unaudited) (unaudited) (audited) Loss for the period (379) (95) (454)*Weighted average number of shares:For basic and diluted loss per share 1,478,070,955 1,317,113,000 1,359,511,785 \* The audited figures for the year ended 31st July 2006 have been restated toaccount for the introduction of FRS 20 which requires share-based payments suchas the share options granted in March 2006 to be accounted for in the Profit andLoss account. 4. Reserves Share Capital Merger Share Profit and Premium reduction Reserve Option Loss Account reserve reserve account Total £'000 £'000 £'000 £'000 £'000 £'000 At 1st August 2006 as previously 21,104 6,650 2,324 - (28,812) 1,266stated Prior year adjustment is respect of - - - 175 (175) -share based payments __________ __________ __________ __________ __________ __________At 1st August 2006 AS RESTATED 21,104 6,650 2,324 175 (28,987) 1,266Share based payments - - - 235 - 235Retained loss for the period - - - - (389) (389) __________ __________ __________ __________ __________ __________At 31st January 2007 21,104 6,650 2,324 410 (29,376) 1,112 __________ __________ __________ __________ __________ __________ 5. Analysis and reconciliation of net funds 1 August 2006 Cash flow 31st January 2007 £'000 £'000 £'000 Cash at bank and in hand 872 (279) 593 6. Analysis of cash flows Six months ended Six months ended Year ended 31st January 2006 31st January 2006 31st July 2006 (unaudited) (unaudited) (audited) £'000 £'000 £'000Returns on investments and servicing offinanceInterest received 10 6 14Interest paid (1) - (6) __________ __________ __________Net cash inflow 9 6 8 __________ __________ __________AcquisitionsAcquisition costs - - (215)Healthstar Group PLC - cash acquired - - 122 __________ __________ __________ (93)Capital expenditure and financial investmentPurchase of tangible fixed assets (1) (3) (10) __________ __________ __________Net cash outflow (1) (3) (10) __________ __________ __________FinancingIssue of share capital - - 235 __________ __________ __________Net cash inflow - - 235 __________ __________ __________ 7. Share based payment Share options were granted to directors and staff in March 2006. These vest inMarch 2009 and are contingent upon the achievement of the following criteria: - 60% for continuous employment during the vesting period and- 40% for achievement of annual profit targets 2007 Weighted average exercise price (p) Number of share options Outstanding at the beginning of the period 111,500,000 1.09p Outstanding at the end of the period 111,500,000 1.09p Exercisable at the end of the period - - The value of the options is measured by the use of a binomial pricing model.The inputs into the binomial model were as follows: 2007 2006 Share price at grant date 2.14p 2.14pExercise price 1.09p 1.09pVolatility 45% 45%Expected life 3 years 3 yearsRisk free rate 4.41% 4.41%Expected dividend yield - - Expected volatility was determined by calculating the historical volatility ofthe Group's share price over the previous 3 years. The expected life used inthe model has been adjusted, based on management's best estimate, for the effectof non-transferability, exercise restrictions and behavioural considerations. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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