15th Aug 2007 07:00
NetDimensions (Holdings) Limited15 August 2007 NetDimensions (Holdings) Limited ("NetDimensions"or the "Company") Interim Results for the period ended 30 June 2007 NetDimensions is a software publisher that provides companies, governmentagencies and other organizations with enterprise-class learning, knowledge andperformance management related software and services, enabling its clients tomanage the delivery and administration of their training, compliance and talentdevelopment programs. These are NetDimensions' first results since its admissionto trading on AIM in May 2007. NetDimensions delivers a strong trading performance Financial Highlights • Sales for the six months to 30 June 2007 increased by 68% to US$2.15 million (2006: US$1.28 million) driven by more than 70 new business customer wins • Operating profit before exceptional items was US$0.21 million (2006: operating loss of US$0.1 million) • The Company has continued to generate cash from operations in the last six months and had cash at bank of US$6.4 million as of 30 June 2007 • Second half results are expected to be stronger, in line with the Company's historical trends Operations Highlights • Added more than 70 new clients during the period • Recruited a new sales team in the Europe, Middle East and Africa (EMEA) region and new sales partners in Vietnam and Taiwan • Established a strategic partnership with a publishing technology provider which led to the launch of a new product, the NetDimensions Enterprise Content Platform (ECP) • Launched the latest 4.7 version of our flagship product, EKP, which was designed with major input from Flight Safety International and Cathay Pacific Airways Roger Durn, Chairman, commented: "I am pleased to present an excellent set ofresults. We have delivered substantial revenue growth and added more than 70 newclients in the last six months. Given that NetDimensions has traditionallygenerated the majority of its annual revenues in the second half of the year andthat we are seeing continued growth in our target markets, the Company isconfident of adding more clients in the second half of 2007 as well ascontinuing to expand global sales capabilities." The Company today also announces that, following its change of name from Teather& Greenwood Limited to Landsbanki Securities (UK) Limited with effect from 9August 2007, the name of the Company's nominated adviser and broker has changedto Landsbanki Securities (UK) Limited. The Company also confirms that all the information required by Rule 26 of theAIM Rules for Companies (February 2007) is available within the "Investors"section of the Company's website at www.netdimensions.com. Enquiries: +-------------------------------+----------------------+---------------+|NetDimensions |Jay Shaw |+852 2122 4500 ||www.netdimensions.com/investor |Jeffery Cheung | || |Allana Edwards | |+-------------------------------+----------------------+---------------+|Landsbanki Securities (UK) |Jeff Keating |+44 (0) 20 7426||Limited |Fred Walsh |9000 ||Nominated Adviser & Broker |Simon Brown | || | | |+-------------------------------+----------------------+---------------+|Cardew Group |Tim Robertson |+44 (0) 20 7930|| | |0777 ||Financial PR Adviser |Shan Shan Willenbrock | || |Catherine Maitland | |+-------------------------------+----------------------+---------------+ CHAIRMAN'S STATEMENT Introduction We are pleased to present our results for the six months to 30 June 2007. Thisis the Company's first set of results since its admission to AIM in May 2007.The Company made substantial progress in the first half of the year with salesincreasing by 68% to US$2.15 million (2006: US$1.28 million), which led to anoperating profit of US$0.21 million compared to a loss of US$0.1 million in thesame period last year. Trading performance was driven by repeat business andsales to more than 70 new clients. Financial Review For the six months to 30 June 2007, revenues increased by 68% to US$2.15million. We have been successful in increasing sales of software licenses whichaccounted for 49.6% of total revenue compared to 29.6% in the same period lastyear. Revenue growth in software licensing has been driven by new customer winsand repeat revenue from existing customers. 42.3% of our revenues came from theprovision of hosting, support and maintenance services. The Company has continued to focus on cost management and the development of itsdirect sales capabilities and global partner network. The Company's cash position remains strong with cash generated from operatingactivities before capital expenditure of US$1.27 million (2006: US$0.067million). As of 30 June 2007, the Company had cash at bank of US$6.4 million (2006: US$0.8 million), which included cash from trading activities as well as the netfundraising proceeds from the Company's 2 May 2007 listing on AIM. The board is not recommending the payment of an interim dividend. A dividend forthe current year will be considered in the first quarter of 2008 when theCompany's first full-year results as a public company will be available. Strategy During the period under review, we continued to deliver on the strategy set outat the time of our IPO focusing on the following three areas: • Creating higher value, more powerful performance support and assessment technology offerings • Stepping up operations capabilities, sales and marketing efforts, partner recruitment and high-end hosted service offerings • Targeting 'best fit' enterprise clients in our core direct sales markets, including aviation and financial services, as well as sales to mid-market companies, the fastest growing part of the Learning Management System (LMS) market. Operations Review In the six months under review, we added more than 70 new clients includingMidwest Airlines, Progress Software Corporation, Lenovo, The Netherlands RedCross, the U.S. Dept of Veterans Affairs, Books a Million, the Chicago PoliceDepartment and Ceridian Limited. New client wins were generated through directand partner-led sales channels throughout the world. Many of the new clientsoperate in highly regulated, compliance driven environments and aim to generateefficiencies through the application of NetDimensions products. The Company was also pleased to see client upgrades during the period, anexample of which was the Chicago Police Department which moved from EKP Bronzeto EKP Silver. In order to better manage the Company's growth, we have aligned our regionalsales focus into three global groups and expanded our in-house teams to providebetter support to clients. We opened our first regional office in the United States in October 2006 whichhas now expanded to become a team of five professionals. The growth of thisoffice is increasingly important as the Company's North American client basecontinues to grow. In May 2007, we appointed Mike Higgins Director of the Europe, Middle East andAfrica (EMEA) region. Mike joins NetDimensions from SkillSoft plc, where hemanaged SkillSoft's EMEA channel partners. We are delighted to welcome Mike toNetDimensions and his addition to our team is expected to help accelerate growthin the region. NetDimensions has appointed senior sales agents in Europe and North America andnew consulting and reseller partners in Asia. A key emphasis in the current year is to continue the development ofNetDimensions as a learning management system provider with increasingly morepowerful performance support and assessment technology offerings. These productenhancements and additions will allow us to offer clients higher value productchoices. The release of the 4.7 version of our flagship product, EKP, included newtechnology that enables the Company to offer assessment functionality targetedat highly regulated industries. This new technology was designed in cooperationwith Flight Safety International and Cathay Pacific Airways. Exampleapplications would include pilot testing for airlines as well as certification,compliance and licensing services for other regulated businesses. The newtechnology will be sold both as a stand-alone system, the Enterprise AssessmentPlatform (EAP), and as part of the Company's high-end EKP Gold offering. The partnership with Xyleme Inc. announced on 11 July 2007 allows the Company tooffer another new product, the NetDimensions Enterprise Content Platform (ECP).ECP is a single-source-publishing solution that represents an importantevolution of NetDimensions' product offerings beyond the learning environment.The combination of EKP and ECP technologies allows NetDimensions to offer itsclients a powerful, integrated platform for knowledge management, performancetracking and content distribution, which is of interest to large organizationswith complicated online and print format publishing and performance supportrequirements. To Clients, Shareholders, Partners and Staff I would like to take this opportunity to thank everyone in all of the Company'smain interest groups. On behalf of NetDimensions, I note that we are very proudof what we have accomplished together so far and truly grateful to you all foryour support. Current Trading and Outlook The current year is expected to continue to show substantial sales revenue andprofit growth as compared to 2006. Historically, the Company achieves the greater part of its annual revenue andprofit in the second half of the year. We expect second-half 2007 revenue andprofit numbers to continue to reflect the historical trend and to be larger thanfirst-half results. We believe our target markets are continuing to grow, particularly in highlyregulated and compliance driven industries. Our recent product innovations aredesigned to better service clients in these industries. These last six months have been a successful period with the Company recordingsubstantial revenue growth and an operating profit for the first time at thehalf-year mark, establishing a strategically important partnership with XylemeInc. and achieving a successful listing and related fundraising on AIM. As aresult, the Board is confident the Company is positioned to continue to expand. Roger Durn Chairman of the Board 15 August 2007 CONSOLIDATED INCOME STATEMENTFor the 6 months period ended 30 JUNE 2007 Unaudited Unaudited Audited 6 months to 6 months to 12 months to Note 30.6.2007 30.6.2006 31.12.2006 US$ US$ US$Revenue 1 2,151,994 1,283,515 3,514,780 Cost of Sales (80,799) (81,420) (159,530) _________ ________ _________Gross profit 2,071,195 1,202,095 3,355,250 Administrative expenses (1,862,704) (1,302,519) (2,810,434)Other operating (loss)/income (1,559) 6,532 _________ ________ _________Operating profit/(loss) before 206,932 (100,424) 551,348Exceptional costs of Placing andAdmission to trading on the AIMMarket _________ ________ _________ Exceptional costs of Placing and (1,092,405) - -Admission to trading on the AIMMarket _________ ________ _________ Operating profit/(loss) (885,473) (100,424) 551,348 Finance income 39,181 9,923 16,110Finance costs (166) (167) (334) _________ ________ _________(Loss)/Profit on Ordinary (846,458) (90,668) 567,124Activities Before Taxation Taxation - - - _________ ________ _________(Loss)/Profit for the period (846,458) (90,668) 567,124 ========= ======== =========Attributable to:Equity shareholders of the (846,458) (90,668) 567,124Company ========= ======== ========= Earnings per share:Basic 2 USD 0.012 (USD 0.005) US$0.03Diluted 2 USD 0.011 (USD 0.004) US$0.03 CONSOLIDATED BALANCE SHEETAs at 30 JUNE 2007 Unaudited Unaudited Audited 6 months to 6 months 12 months to to 30.6.2007 30.6.2006 31.12.2006 US$ US$ US$ASSETSNon-current assetsProperty, plant and equipment 194,637 42,977 58,617Intangible assets 15,593 16,885 15,585 _________ ________ _________ 210,230 59,862 74,202 _________ ________ _________Current assetsInventories 2,104 4,572 12,954Trade and other receivables 1,243,838 1,210,913 2,403,486Cash and cash equivalents 6,356,081 843,380 521,332 _________ ________ _________ 7,602,023 2,058,865 2,937,772 _________ ________ _________TOTAL ASSETS 7,812,253 2,118,727 3,011,974 ========= ======== =========EQUITY AND LIABILITIESEquity attributable to equity holders of the Company Share Capital 24,731 19,629 19,707Share Premium 11,077,122 5,272,366 5,291,448Foreign currency translation (8,542) (1,105) (1,580)reserve Retained earnings (4,836,808) (4,742,280) (4,056,900) _________ _________ _________Total equity 6,256,503 548,610 1,252,675 _________ _________ _________Non-current liabilitiesObligations under finance leases 3,050 4,434 3,748 _________ _________ _________ Current liabilitiesTrade and other payables 1,551,344 1,564,319 1,754,188Obligations under finance leases 1,356 1,364 1,363 _________ _________ _________ 1,552,700 1,565,683 1,755,551 _________ _________ _________Total liabilities 1,555,750 1,570,117 1,759,299 _________ _________ _________TOTAL EQUITY AND LIABILITIES 7,812,253 2,118,727 3,011,974 ========= ========= ========= CONSOLIDATED CASHFLOW STATEMENTFor the 6 months period ended 30 JUNE 2007 Unaudited Unaudited Audited 6 months 6 months 12 months to to to Note 30.6.2007 30.6.2006 31.12.2006 US$ US$ US$ Cash flow from operating 3 1,272,925 67,297 (241,128)activities _________ _________ _________Cash flow used in investing activities Proceeds on disposal of - - 659property, plant and equipmentPurchase of intangible assets (7,384) (15,150) (23,510)Purchase of property, plant and (161,125) (18,028) (47,329)equipment Interest received 39,181 9,923 16,110 _________ _________ _________Net cash used in investing (129,328) (23,255) (54,070)activities _________ _________ _________ Cash flow from financingactivitiesInterest and finance charges paid (166) (167) (334)Repayment of borrowings and (678) (678) (1,363)finance leasesNet Proceeds from issue of shares 4,698,281 108,733 127,891 _________ _________ _________ Net cash from financing 4,697,437 107,888 126,194activities _________ _________ _________ Net increase/ (decrease) in cash 5,841,034 151,930 (169,004)and cash equivalents Cash and cash equivalents at 521,332 692,452 692,452beginning of the periodEffect of foreign exchange rate (6,285) (1,002) (2,116)changes _________ _________ _________ Cash and cash equivalents at end 6,356,081 843,380 521,332of the period ========= ========= ========= CONSOLIDATED STATEMENT OF RECOGNISED INCOME AND EXPENSEFor the 6 months period ended 30 JUNE2007 Unaudited Unaudited Audited 6 months 6 months 12 months to to to 30.6.2007 30.6.2006 31.12.2006 US$ US$ US$Exchange differences ontranslation of foreign operations (6,962) (2,082) (2,557) _________ _________ _________Income and expenses recognised (6,962) (2,082) (2,557)directly in equity (Loss)/Profit for the period (846,458) (90,668) 567,124 _________ _________ _________Total income and expenserecognised in the period (853,420) (92,750) 564,567 ========= ========= =========Attributable to:Equity shareholders of the Company (853,420) (92,750) 564,567 ========= ========= ========= NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS For the 6 months period ended 30 JUNE 2007 1. Accounting Polices And Basis of Preparation The interim results contained in this report have been prepared using accounting policies consistent with those used in the preparation of the annual report and accounts for the year ended 31 December 2006, under the historical cost convention and on the going concern basis. The consolidated financial statements include the financial statements of the Company and its subsidiaries as at the balance sheet date. 2. Earnings Per Share Basic earnings per share is calculated by dividing the operating profit before exceptional costs of placing and admission to trading on the AIM market for the period by the weighted average number of ordinary shares in issue during the financial period. Unaudited Unaudited Audited 6 months to 6 months 12 months to to 30.6.2007 30.6.2006 31.12.2006 US$ US$ US$ Earnings Earnings for the purposes of 245,947 (90,668) 567,124 basic earnings per share being net profit/(loss) before exceptional costs of placing and admission to trading on the AIM market ======== ======== ======== Earnings for the purposes of 245,947 (90,668) 567,124 diluted earnings per share ======== ======== ======== Number of shares Weighted average number of 21,346,576 19,629,366 19,658,352 shares for the purposes of basic earnings per share Effect of dilutive potential shares: Share options 1,589,346 791,254 963,928 __________ __________ __________ Weighted average number of 22,935,922 20,420,620 20,622,280 shares for the purposes of dilutive earnings per share ========== ========== ========== Unaudited Unaudited Audited 6 months to 6 months 12 months to to 30.6.2007 30.6.2006 31.12.20063. Cash flows from operating US$ US$ US$ activities (Loss)/Profit before tax (846,458) (90,668) 567,124 Exceptional costs of Placing 1,092,405 - - and Admission to trading on the AIM Market Share-based payments 66,550 27,586 55,173 Depreciation 23,048 10,676 23,968 Amortization 7,182 8,314 18,001 Gain on disposal of property, 1,559 - (372) plant and equipment Finance lease charges 166 167 334 Interest income (39,181) (9,923) (16,110) _________ _________ ________ Operating cash flow before 305,271 (53,848) 648,118 changes in working capital Decrease/(Increase) in 10,850 7,549 (833) inventories Decrease/(Increase) in 1,159,648 719,770 (478,700) receivables (Decrease) in creditors (202,844) (606,174) (409,713) _________ _________ ________ Cash flow from operating 1,272,925 67,297 (241,128) activities ========= ========= ======== This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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