28th Nov 2005 07:01
Eckoh Technologies PLC28 November 2005 For Immediate Release 28 November 2005 Eckoh Technologies plc Half-Year Results 6 months 6 months Year ended ended ended 30 Sept 30 Sept 31 March 2005 2004 2005 £'000 £'000 £'000 Turnover 55,007 39,416 79,720Continuing operations 35,561 37,720 76,529Acquisitions 18,566 - -Total continuing operations 54,127 37,720 76,529Discontinued operations 880 1,696 3,191 Gross profit 11,496 9,486 20,045 Operating loss (478) (1,132) (9,783) Profit/(loss) before taxation 1,226 (970) (9,411) Adjusted profit before taxation(1) 856 241 884 Profit/(loss) for the period 969 (1,091) (9,440) Cash and short-term investments 12,501 9,083 13,296 Half-year highlights: • Group turnover increased by 40% to £55.0m (H1 2004/5 - £39.4m) • Adjusted PBT increased to £0.9m from £0.2m (Profit before taxation £1.2m (H1 2004/5 - loss £1.0m)) • Retained Profit of £1.0m (H1 2004/5 - loss £1.1m) • Cash and short-term investment balances total £12.5m • Flotation of Symphony Telecom Holdings plc on AIM Operational Highlights: • Speech Alliance with BT extended until 2010 • New Speech contract wins with Scottish Power, Her Majesty's Court Service and Probability Games Corporation and renewals with TD Waterhouse and William Hill • Journey Finder voted "Product of the Year 2005" at this year's European Call Centre Awards • Ongoing strategic review of the Eckoh Group designed to unlock long-term shareholder value (1) Profit before taxation, intangible asset amortisation and impairment and exceptional items Martin Turner, Chief Executive Officer, commented today: "Our annual turnover run-rate now comfortably exceeds £100m for the first time.Interim gross profit increased 21%, profit before tax (excluding goodwill andexceptional items) was £1.2m, and the group delivered a net profit of £1.0m. Allareas of the group continue to make good progress. We see more growth ahead, and are continuing with our strategic review designedto deliver long-term shareholder value. Current trading indicates furtherimprovements in financial and operating performance in the second half of thefinancial year, and we remain confident about Eckoh's future prospects." For further enquiries, please contact Eckoh Technologies plcMartin Turner, Chief Executive OfficerNik Philpot, Chief Operating OfficerAdam Moloney, Group Finance Directorwww.eckoh.com Tel: 01442 458 300 Buchanan CommunicationsMark Edwards/Jeremy Garcia Tel: 020 7466 5000 Corporate developments The Board of Directors and its advisors are continuing to evaluate a number ofstrategic options designed to create long-term value from Eckoh's constituentbusinesses, simplify Eckoh's ongoing operations and increase overallprofitability and cash flows. As part of this review, the following transactions have been completed in thefirst half of this financial year: • The acquisition of Anglia Telecom Centres Limited on 29 April 2005 by Symphony Telecom Holdings plc for up to £10.0m; • The subsequent flotation of the enlarged Symphony group on AIM, and placing of shares on 15 September. As at 30 September 2005 Eckoh retains a 64.64% shareholding in Symphony, currently valued at £7.1m, and which will continue to remain a subsidiary of Eckoh until such time that Eckoh's shareholding falls below 50% through the issue of new Symphony ordinary shares, or the disposal by Eckoh of some, or all, of its shares in Symphony; and • The sale of Freecom.net to OFEX-listed eDirectory.co.uk plc on 31 July 2005 for consideration of up to £3.2m in shares and cash. Following the completion of these transactions, the continuing Eckoh Groupoperates three principal trading divisions - Eckoh Speech Solutions, AdvertisedIVR Services and Client IVR Services. These continue to be subject to theGroup's ongoing strategic review. Continuing operations Eckoh Speech Solutions Eckoh is a European market leader in self-service call centre solutions usingadvanced speech recognition and related technologies. The Group has an exclusivepartnership with BT to provide its top corporate customers with hosted speechrecognition services. To date this alliance has supplied speech solutionsservices to 18 clients and created over 22 applications, generating over 30million minutes of self-service speech transactions. The BT alliance wasextended in July of this year until 2010, which will enable BT to fulfil theincreasing requirement from customers for long term, multi-year contracts forEckoh's hosted speech recognition services. First half turnover from Speech Solutions was £2.3m (H1 2004/5 - £2.7m) with agross margin of 51% (H1 2004/5 - 50%). The decline in revenues compared with H12004/5 is primarily due to lower results from the cinema clients and thenon-recurrence of a number of one-off build fees. The revenue model has focusedon keeping set-up fees low to maximise overall contract value and to clearlydifferentiate Eckoh's pricing proposition from a customer premised speechsolution. This model is expected to deliver more predictable growth and revenuesgoing forward. Direct operating expenses were stable at £1.1m (H1 2004/5 -£1.1m). Despite the steady performance in revenue there continues to be good progressmade in acquiring high quality new clients, broadening our reach into what weconsider to be the more lucrative markets in the medium to long term. During H1the utility sector in particular has started to perform strongly with ThreeValleys Water and NIE going live through the BT alliance, and a new contract forservices to Scottish Power. There is a further contract announced today, withHer Majesty's Court Service to provide an automated payment collection servicein the North East region. A contract has been signed to supply a speech-enabledroulette service to Probability Games Corporation for use in a new televisionformat expected to launch in January 2006. In addition a new two-year contractwith Ideal Shopping Direct to provide complex data capture services began inJune. There have also been key contract renewals with William Hill and TD Waterhouseindicating that Eckoh's proposition remains competitive and is delivering theappropriate value to the clients. In addition, "Journey Finder", a speech-basedproduct developed by BT and Eckoh Technologies and utilised in the successfulTraintracker service for National Rail Enquiries, was voted "Product of the Year2005" at this year's European Call Centre Awards. Sales efforts are increasingly focused on the financial services, public sector,travel and utilities sectors where although the sales cycles are typicallylonger than average, it is believed that the largest contracts will ultimatelybe won. To that end the sales team has been strengthened with sales specialistsin these areas. Because operating expenses have been stable, and are expected toremain at the same level, any increase to revenues at the 50%+ margins currentlyachieved will have a significant effect on the profitability of the Group. The Directors continue to be confident that there is potential for significantgrowth in the UK and European hosted speech markets and believe that its firstmover advantage, coupled with its extended alliance with BT, places Eckoh SpeechSolutions in a prime position to benefit from that growth. The Directorscontinue to assess all available options and opportunities for the SpeechSolutions division in order to facilitate growth and thus create shareholdervalue. Advertised IVR Services Advertised IVR Services has operated profitably for many years. It operates avariety of consumer entertainment voice and data products such as dating andchat services, competitions, and mobile content which it advertises innewspapers, magazines and on television. Since July 2003 this includes L!VE TVas a flexible and low cost environment to test, promote and showcase theseservices. Gross margins from individual campaigns fluctuate with advertisingefficiency, which is influenced by price, seasonality, TV programming andavailability. First half turnover from Advertised Services increased to £6.1m (H1 2004/5 -£5.7m) with a gross margin of 44% (H1 2004/5 - 40%). Direct operating expenseswere £1.2m (H1 2004/5 - £1.2m). The Directors see further opportunities for growth in both turnover andprofitability through increased distribution and the introduction of newservices. Specifically, the new contract with IPC Magazines in the Client IVRServices area is presenting cross-selling opportunities, particularly for datingservices, into their large portfolio of consumer magazines. In addition, theincreasing penetration of WAP enabled and 3G mobile handsets is presenting newopportunities for broadening the dating proposition to include photos and videoclips of users, which it is anticipated will appeal to a wider market. Proposed changes to the Electronic Programming Guide (EPG) on the Sky Digitaltelevision platform is likely to result in L!VE TV's channel number and positionbeing changed early in 2006. It is uncertain yet what impact this will have onoverall revenues although some of the airtime sales arrangements for daytimehours are likely to be lost as a result. This has forced a review of thestrategy for the channel and a number of options are being considered and trialsundertaken. However, until the timing of the change becomes certain, no firmdecision will be taken on how the channel will be operated going forward. The first half has seen reasonable levels of expenditure in creating new salesand marketing materials to publicise the various services. This should start toreap benefits as the new advertisements and commercials are introduced. Profitlevels in this division are expected to continue to be strong in the second halfof the financial year. Client IVR Services Eckoh's Client IVR Services is one of the UK's largest suppliers of premium IVRand premium SMS services, and works with a number of prominent media owners suchas ITV, Trinity Mirror, Channel 4, IPC, EMAP and Northcliffe Newspapers. Eckohdelivers an end-to-end interactive solution including creation, design,development, implementation, deployment, hosting and reporting. Client Services is able to secure and retain the largest contracts by offeringquality customer support, hosting its services on one of the largest callprocessing platforms in the UK, and by offering very competitive rates. Thesecontracts generate an extremely large aggregated call volume which allows Eckohto derive the best commercial contracts from carriers such as BT and C&W as wellas through Eckoh's own network. Although margins are low from its directactivity, the division is complementary to both Speech Solutions and AdvertisedServices who are able to benefit from accessing the same rate structure, as wellas cross-selling their higher margin services. The ITV contract is arguably the largest IVR contract of its kind available inthe UK, and in April 2005 this was renewed until at least August 2006. As ITVbroadens its reach by opening new channels and launching new interactive formatsit is anticipated that this will increase the volume of telephony serviced byEckoh. In addition, the three-year contract with IPC Magazines to supply IVR andSMS services to their portfolio of magazines commenced successfully in June2005, and this activity is expected to grow over time as more of the titlesincorporate Eckoh's range of products. Notwithstanding the competitive nature of the market, Eckoh has successfullyfocused on providing high levels of service to a small number of blue-chipclients without compromising quality. A number of contracts with smaller andunprofitable clients have not been renewed. The recent renewal of contracts withITV, Trinity and Northcliffe, suggests this "80:20" approach is deliveringresults, and with a reduced cost base and increased efficiency, the division isnow making an improved financial contribution to the Group. First half turnover from Client Services was £16.1m (H1 2004/5 - £19.1m), with agross margin of 8% (H1 2004/5 - 8%). Direct operating expenses were £1.2m (H12004/5 - £1.5m). The performance in H2 is expected to improve as the Autumn ITVtelevision schedule delivers successful interactive shows such as "I'm aCelebrity, get me out of here!" which have a track record of generating highcall volumes. Looking forward, Client IVR Services will continue to concentrate its efforts oncompeting for long-term, quality media and broadcast business from the major UKplayers. Symphony Telecom On 15 September 2005, Eckoh's telecoms subsidiary, Symphony Telecom Holdings plcfloated on AIM (London Stock Exchange ticker: SMY), at the same time placing35.36% of shares with new investors. Symphony is therefore now a 64.64%subsidiary of Eckoh and its financial results have been fully consolidated intoEckoh's financial statements. Symphony today released its standalone results forthe six months ended 30 September 2005, and the following are extracts from theannouncement: "During the six months ended 30 September 2005, the (Symphony) Board hasfocussed on the creation of an enlarged telecommunications services group, witha strong balance sheet and a target of becoming the clear UK market leader inits field. The successful integration of the Anglia business, which was acquiredon 29 April 2005, together with the IPO, has created a financially strong Groupcapable of achieving sustained organic and acquisitive growth, particularly inthe area of mobile and data services. With a strong balance sheet andlike-for-like turnover of the combined businesses up by over 30% compared tolast year, the Directors are confident that a solid platform for future successhas been established." "During the six months ended 30 September 2005 turnover increased to £29.7m(2004: £10.2m), largely due to the acquisition of the Anglia business whichcontributed £18.6m, whilst operating profits before exceptional items andintangible asset amortisation amounted to £1.2m (2004: £0.7m). After intangibleasset amortisation of £0.9m (2004: £nil) and exceptional restructuring andintegration costs of £0.2m (2004: £nil), operating profit was £0.2m (2004:£0.7m)." The full text of the Symphony results for the period can be found on the Companywebsite, www.symphony.com Discontinued operations Eckoh disposed of Freecom.net Limited, its internet services company, toeDirectory.co.uk plc ('eDirectory') on 29 July 2005. The consideration comprises4,155,844 eDirectory ordinary shares. Further to this, subject to certainconditions, a further £1.6 million of deferred consideration is payable ineDirectory ordinary shares or a cash equivalent. eDirectory shares are currentlytraded on Ofex. Turnover from Freecom for the four month period up to the date of disposal on 29July 2005 was £0.9m (H1 2004/5 - £1.7m) with a gross margin of 65% (H1 2004/5 -71%). Direct operating expenses were £0.8m (H1 2004/5 - £1.0m). The business hasbeen included within discontinued operations in Eckoh's financial statements.The accounting treatment for this transaction was to show a net nil gain, nilloss on disposal in the profit and loss account. There is some uncertainty as tothe fair value of the Ofex listed ordinary shares received as consideration andas such, management believe it would not be appropriate to show a profit or losson the disposal of this subsidiary at this time. Operating loss and net profit Excluding intangible asset amortisation and impairment and restructuring costs,Eckoh generated an operating profit of £1.0m for the half year, a significantimprovement on the £0.1m generated in the comparative period. The operating lossfor the period was £0.5m (H1 2004/5 - £1.1m). During the period under review, there were three exceptional gains. A gain of£1.5m arose from the 35% disposal as a result of the flotation of Symphony,£0.1m was received in respect of contingent consideration following the disposalof the hardware services operation in a prior year and £0.1m was generated fromthe disposal of investment shares held in Felix Group plc. A net profit of £1.0m has been made in the period (H1 2004/5 - loss £1.1m).Basic and diluted earnings per share is 0.4p (H1 2004/5 - loss per share 0.4p). Group analysis Eckoh currently holds a 64.64% shareholding in Symphony but it is anticipatedthat the shareholding will be diluted over time to less than 50%, at whichpoint, the financial results of Symphony will no longer be consolidated withinthose of the Eckoh Group. The table below separates the results of Symphony andthe discontinued operation of Freecom from the results of Eckoh to provideclarification of the Eckoh results in isolation. Eckoh Symphony Freecom Total H1 06 H1 05 H1 06 H1 05 H1 06 H1 05 H1 06 H1 05 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 Turnover 24,448 27,476 29,679 10,244 880 1,696 55,007 39,416 Gross profit 5,128 5,178 5,798 3,107 570 1,201 11,496 9,486 Gross profit% 21% 19% 20% 30% 65% 71% 21% 24% Directexpenses (3,477) (3,724) (4,473) (2,343) (784) (1,028) (8,734) (7,095) Indirectexpenses (1,264) (1,674) - - - - (1,264) (1,674)Depreciation (428) (523) (101) (79) (19) (36) (548) (638)Totaladministrativeexpenses (5,169) (5,921) (4,574) (2,422) (803) (1,064) (10,546) (9,407) Operatingprofit (41) (743) 1,224 685 (233) 137 950 79 Net interest 212 162 (306) - - - (94) 162 Adjusted PBT* 171 (581) 918 685 (233) 137 856 241 * Profit before taxation, intangible asset amortisation and impairment,restructure costs and exceptional items The direct operating expenses have been discussed in some detail above. Theindirect operating expenses are largely fixed in nature and include corporatecosts such as the board of directors, legal, secretarial, audit, registrar,professional advisors, insurance and other plc-related costs. They also includethe cost of Eckoh support functions such as finance, IT and its Hemel Hempsteadhead office occupation costs. There has been a significant reduction in the indirect operating expenses withinEckoh. The creation of the Symphony group required formal allocations of costssuch as property, insurance and finance. These items are now reported within thedirect costs of Symphony and have consequently reduced the indirect operatingexpenses in Eckoh. Cash and short-term investments Cash and short-term investments as at 31 September 2005 reduced to £12.5m (31March 2005 - £13.3m) despite a cash inflow from operating activities, beforeworking capital movements, of £1.3m for the half year (H1 2004/5 - cash inflow£0.7m). The significant cash movements in the period other than from operatingactivities were the acquisition of Anglia (£9.0m net outflow), net loan proceedsfrom RBS (£5.2m inflow) and the net proceeds from the IPO of Symphony (£3.9minflow). Board changes On 1 August 2005 Adam Moloney was appointed Group Finance Director. Prior to hisappointment, and following the departure of the previous Group Finance Director,Adam was Acting Group Finance Director. Strategy of the continuing Eckoh Group and current trading The Directors are continuing with their strategic review of the Eckoh Group,with a view to maximising long-term value for shareholders. This review - whichresulted in the acquisition of Anglia Telecom on 29 April 2005, disposal ofFreecom on 29 July 2005 and AIM flotation of Symphony Telecom on 15 September2005 - has already delivered improvements in operational and financialperformance across the Group with pre-tax profits of over £1m being generated inthe first half of the financial year on increased turnover of £55m, and thepotential for significant increases in the value of Eckoh's investments arisingfrom these transactions. In particular, Eckoh has converted its Symphony telecommunications division intoa 64.64% shareholding in an enlarged AIM-listed company, Symphony TelecomHoldings plc, which also reported its maiden half year results today. Symphonyhas seen like-for-like turnover increase by over 30% to £30m for the half yearand the Directors are confident that Symphony will continue to make goodprogress as an independent entity. Eckoh's shareholding is currently valued at£7.1m. The Directors are also continuing to explore options designed to accelerate thedevelopment of Eckoh's Speech Solutions business, and ensure that it remains aEuropean market leader. It is essential that this business not only continues todevelop organically, but is also capable of pro-actively participating inindustry consolidation. Further progress is expected by the end of the financialyear. Current trading indicates further improvements in Group financial performance atthe start of the second half of the financial year, and which is in line withmarket expectations. Consolidated profit and loss account for the six months ended 30 September 2005 Note 6 months 6 months Year ended ended ended 30 Sept 30 Sept 31 Mar 2005 2004 2005 unaudited unaudited audited £'000 £'000 £'000 Turnover 55,007 39,416 79,720 Continuingoperations 35,561 37,720 76,529 Acquisitions 18,566 - - Totalcontinuingoperations 54,127 37,720 76,529 Discontinuedoperations 880 1,696 3,191 Cost of sales (43,511) (29,930) (59,675) Gross profit 11,496 9,486 20,045Administrativeexpensesbeforeintangibleassetamortisationand impairmentandrestructurecosts (10,546) (9,407) (19,533) Amortisationof intangibleassets (998) (1,211) (2,539)Impairment ofintangibleassets (232) - (7,756)Restructurecosts (198) - -Totaladministrativeexpenses (11,974) (10,618) (29,828) Operatingprofit/(loss)beforeintangibleassetamortisationand impairmentandrestructuringcosts 950 79 512Continuingoperations 326 (41) 455 Acquisitions 857 - - Totalcontinuingoperations 1,183 (41) 455 Discontinuedoperations (233) 120 57 Operating(loss)/profit (478) (1,132) (9,783)Continuingoperations 139 (1,252) (9,840) Acquisitions (152) - - Totalcontinuingoperations (13) (1,252) (9,840) Discontinuedoperations (465) 120 57 Gain on partdisposal ofsubsidiaryundertaking 1,547 - -Gain ondisposal offixed assetinvestment 141 - -Gain ondisposal ofhardwareservicesoperation 110 - -Net interest(payable)/receivable andother similaritems (94) 162 372Profit/(loss)on ordinaryactivitiesbeforetaxation 1,226 (970) (9,411) Taxation (135) - (6)Profit/(loss)on ordinaryactivitiesafter taxation 1,091 (970) (9,417) Minorityinterests (122) (121) (23)Profit/(loss)for the period 969 (1,091) (9,440) Earnings/(loss) per ordinaryshare 2 Basic anddilutedearnings/(loss) per share 0.4p (0.4p) (3.5p) Statement of total recognised gains and losses for the six months ended 30 September 2005 6 months 6 months Year ended ended ended 30 Sept 30 Sept 31 Mar 2005 2004 2005 unaudited unaudited audited £'000 £'000 £'000Profit/(loss)for the period 969 (1,091) (9,440)Exchangeadjustmentsoffset inreserves 22 (17) (8)Totalrecognisedgains/(losses)for the period 991 (1,108) (9,448) Consolidated balance sheetas at 30 September 2005 30 Sept 30 Sept 31 Mar 2005 2004 2005 unaudited unaudited audited Note £'000 £'000 £'000 Fixed assets Intangible fixed assets 9,546 9,398 918Tangible fixed assets 1,454 1,627 1,571Investment 306 - - 11,306 11,025 2,489 Current assets Stock 766 105 22Debtors 17,458 11,725 11,021Short term investments 2,000 6,500 7,000Cash at bank and in hand 10,501 2,583 6,296 30,725 20,913 24,339 Creditors: amounts falling duewithin one year (26,146) (14,236) (17,353)Net current assets 4,579 6,677 6,986 Total assets less currentliabilities 15,885 17,702 9,475 Creditors: amounts falling dueafter more than one year (3,278) (56) (65) Provisions for liabilities andcharges (269) (216) (152) Net assets 12,338 17,430 9,258 Capital and reserves 3Called up share capital 680 678 679Share premium account 197 132 147Merger reserve - 5,979 -Profit and loss account 9,116 10,486 8,125Total equity shareholders'funds 4 9,993 17,275 8,951 Minority interests 2,345 155 307 Capital employed 12,338 17,430 9,258 Consolidated cash flow statementfor the six months ended 30 September 2005 Note 6 months 6 months Year ended ended ended 30 Sept 30 Sept 31 Mar 2005 2004 2005 unaudited unaudited audited £'000 £'000 £'000 Net cash(outflow)/inflow fromoperatingactivities 5 (66) (560) 4,475 Return on investments and servicing offinanceNet interest (94) 162 372Loan issuecosts (257) - - (351) 162 372 Taxation (362) (8) - Capital expenditure and financialinvestmentPurchase oftangible fixedassets (376) (544) (1,167) Expenditure onintangiblefixed assets (106) (190) (290)Proceeds ondisposal offixed assetinvestment 141 - - (341) (734) (1,457) Acquisitions and disposals Purchase ofsubsidiaryundertaking (9,707) - (250)Net cashacquired withsubsidiaryundertaking 792 - -Disposal ofsubsidiaryundertaking (29) - -Net cashdisposed withsubsidiaryundertaking (107) - -Proceeds ondisposal ofhardwareservicesoperation 110Proceeds onpart disposalof subsidiaryundertaking 3,878 - - (5,063) - (250) Cash(outflow)/inflow before useof liquidresources andfinancing (6,183) (1,140) 3,140 Management of liquid resourcesDecrease/(increase) inshort-terminvestments 5,000 - (500) FinancingIssue ofshares (51) 10 26Loan issue 6,000Loanrepayments (540) - (80)Capitalelement offinance leasepayments (21) (26) (29) 5,388 (16) (83) Increase/(decrease) in cashin the period 4,205 (1,156) 2,557 Notes to the half-year results 1. Basis of preparation The financial statements for the six months ended 30 September 2005 have beenprepared using accounting policies consistent with those set out in theCompany's consolidated 2005 statutory accounts. These statements do notconstitute statutory accounts within the meaning of section 240 of the CompaniesAct 1985 and are unaudited. Financial information for the six months ended 30 September 2004 has beenextracted from the accounting records of the Group. The balances as at 31 March 2005 and the results for the year then ended havebeen extracted from the statutory accounts, which have been filed with theRegistrar of Companies. The auditors' report on those accounts was unqualifiedand did not contain any statement under section 237 of the Companies Act 1985. The results for the six months ended 30 September 2005 were approved by theBoard on 25 November 2005 and will be posted on the Company's web site,www.eckoh.com, on 28 November 2005. The Symphony Telecom Holdings plc results will be posted on the Symphonywebsite, www.symphony.com on 28 November 2005. 2. Earnings/(loss) per ordinary share of 0.25p each 6 months 6 months Year ended ended ended 30 Sept 30 Sept 31 March 2005 2004 2005 £'000 £'000 £'000 Profit for theperiod beforethe following: 2,397 120 855 Intangibleassetamortisation (998) (1,211) (2,539) Intangibleassetimpairment (232) - (7,756) Restructuringcosts (198) - - Profit/(loss)for the period 969 (1,091) (9,440) Weighted average number of shares in the period: Basic anddiluted 271,628,649 271,175,818 271,226,435 Basicearnings/(loss) per sharebefore intangibleasset amortisationand impaiment andrestructuring costs 0.9p 0.0p (3.5p) Intangibleassetamortisation (0.4p) (0.4p) (0.9p) Intangibleassetimpairment (0.1p) - (2.9p) Restructurecosts (0.0p) - - Basic anddilutedearnings/(loss) per share 0.4p (0.4p) (0.3p) None of the share options in issue give rise to a dilution in the loss pershare. 3. Share capital and reserves Ordinary Share Profit share premium and loss capital account account £'000 £'000 £'000 At 1 April2005 679 147 8,125 Profit for theperiod - - 969 Exchangeadjustmentsoffset inreserves - - 22 Shares issuedin respect ofshare optionsexercised 1 50 - At 30September 2005 680 197 9,116 4. Reconciliation of movement in equity shareholders' funds 6 6 months Year months ended ended 31 ended 30 Sept March 30 Sept 2004 2005 2005 £'000 £'000 £'000 Opening equityshareholders'funds 8,951 18,373 18,373Profit/(loss)for the period 969 (1,091) (9,440)Employee shareoptionsexercised 51 10 26 Exchangeadjustmentsoffset inreserves 22 (17) (8) Closing equityshareholders'funds 9,993 17,275 8,951 5. Net cash inflow/(outflow) from operating activities 6 6 Year months months ended 31 ended ended March 30 Sept 30 Sept 2005 2005 2004 £'000 £'000 £'000Operating loss (478) (1,132) (9,783) Depreciationand impairmentof tangiblefixed assets 548 638 1,319Amortisationand impairmentof intangiblefixed assets 1,230 1,211 10,295 Loss ondisposal oftangible fixedassets - - 7 (Increase)/decrease in stock (172) (43) 40 (Increase)/decrease indebtors (3,660) (852) (148) Increase/(decrease) increditors/provisions 2,466 (382) 2,745 (66) (560) 4,475 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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