28th Jun 2006 07:01
India Outsourcing Services PLC28 June 2006 For immediate release 28 June 2006 INDIA OUTSOURCING SERVICES PLC ("India Outsourcing" or "the Company") Interim Results for the six months ended 31 March 2006 India Outsourcing Services plc (AIM: IOS), a company formed to capitalise onacquisition and investment opportunities primarily in the Indian businessprocess outsourcing (BPO) market, is pleased to announce its interim results forthe six months to 31 March 2006. Highlights • A successful placing in Feburary 2006 raised £3 million before expenses to assist the Company to pursue its strategy of building an international outsourcing business through acquisition • After a thorough search, the Company is now focussing its attention on a specific opportunity from a limited number of potential acquisition candidates. The Company realises this process has been protracted but hopes to be in a position to provide shareholders with an update in the near future • Wheddon Limited, an investment vehicle associated with Vincent Tchenguiz' Consensus Business Group, invested a further £0.5 million in the Company by subscribing for 1 million shares at 50p per share • India Outsourcing is working with Consensus Business Group to identify opportunities where the Company can provide offshoring solutions to Consensus' portfolio companies • Balance sheet remains strong, with net cash at the period end of £3.37 million Haresh Kanabar, India Outsourcing's Chairman, commented: "Our search foracquisitions has been detailed and selective but I am satisfied by the progressmade during the period, and post the period end, as we continue to move closertowards our first transaction." For further information: India Outsourcing Services plc Tel: 020 7297 0010Haresh Kanabar, Chairman Amit Pau, Chief Executive Teather & Greenwood Tel: 020 7426 9000Mark DickensonSindre Ottesen Buchanan Communications Tel: 020 7466 5000Mark Court/Suzanne Brocks/Amy Rajendran CHAIRMAN'S STATEMENT I am pleased to report India Outsourcing's interim results for the six months to31 March 2006, a period during which we made further progress towards thedelivery of our strategy of creating through acquisition an internationaloutsourcing business with a focus on the Indian business processing outsourcing(BPO) market. The Indian BPO market continues to grow strongly, reinforcing our confidence inthe Company's strategy. A recent forecast by NASSCOMM and McKinsey indicatesthat the Indian BPO market will be worth $21 billion by 2008. Our search for acquisition opportunities has been thorough. We have looked at anumber of potential acquisition candidates but have been highly selective. Ouracquisition criteria include requirements including that potential acquisitionis should be revenue-generating, scalable, cashflow positive, have strongmanagement teams and recurring revenues. The Company's ultimate objective is to acquire a small number of complementarycompanies to exploit cross selling opportunities and to benefit from costreduction. The market segments that we are focussing on are document managementand healthcare. The Company has made significant progress in evaluating oneparticular acquisition opportunity, although there is no certainty at this stagethat this transaction will complete. We look forward to providing furtherdetails in due course. The Company's balance sheet was strengthened during the period by a £3 millionfundraising before expenses in which new institutional shareholders joined theCompany's register. At the time of this fundraising the Company's shares wereconsolidated on a 10 for 1 basis to ensure that the Company's shares areattractive to institutional investors. On 21 March, the Company was delighted to attract a further strategic investmentfrom Wheddon Limited ("Wheddon"), an investment vehicle associated with VincentTchenguiz' Consensus Business Group. The investment, in 1 million shares in theCompany at 50p a share, marks the second strategic investment in the Company byWheddon. The Company is now working with Consensus Business Group to identifyopportunities where the Company can provide offshoring solutions to ConsensusBusiness Group's portfolio companies. We look forward to updating shareholdersin due course on progress with this relationship. Financials The Company's performance in the period was in line with managementexpectations. The pre- and post-tax loss in the period was £(213,808) and theloss per share was (7.33)p. The Company's net cash as at 31 March 2006 was £3.37million. Outlook The second half of the financial year has started well in terms of progress withthe delivery of our strategy. The Indian BPO market is growing at a formidablepace and we hope to be in a position to provide shareholders with furtherupdates in the near future. Haresh KanabarChairman28 June 2006 India Outsourcing Services Plc Profit and loss account for the period ended 31 March 2006 6 months ended 6 months ended period ended 31 March 2006 31 March 2005 30 September 2005 (unaudited) (unaudited) (audited) £ £ £ Administrative expenses 226,888 106,037 432,503 Operating Loss (226,888) (106,037) (432,503) Net Interest receivable 13,080 4,404 8134 Loss on ordinary activities before taxation (213,808) (101,633) (424,369) Tax on loss on ordinary activities - - - Loss on ordinary activities after taxation (213,808) (101,633) (424,369) Loss per share- basic and diluted (7.33)p (11.4)p (34.75)p All amounts relate to continuing activities. All recognised gains and losses for the period have been included in the profitand loss account. India Outsourcing Services Plc Balance sheet at 31 March 2006 6 months ended 6 months ended period ended 31 March 2006 31 March 2005 30 September 2005 (unaudited) (unaudited) (audited) £ £ £ Fixed assets 2,609 5,162 4,078Tangible assets Current assets Debtors 44,777 61,541 5037Cash at bank and in hand 3,373,237 394,527 359,795 3,418,014 456,068 364,832 Creditors falling due within one year (111,843) (113,458) (106,015) Net current assets 3,306,171 342,610 258,817 Total assets less current liabilities 3,308,780 347,772 262,895 Capital and reservesCalled up share capital 947,917 150,000 181,250Share premium account 2,999,040 299,405 506,014Profit and loss account (638,177) (101,633) (424,369) Shareholders funds - equity 3,308,780 347,772 262,895 India Outsourcing Services Plc Cash flow statement for the period ended 31 March 2006 6 months ended 6 months ended period ended 31 March 2006 31 March 2005 30 September 2005 (unaudited) (unaudited) (audited) £ £ £ Net cash outflow from operating activities (259,330) (53,776) (329,729) Returns on investments and servicing of financeInterest received 13,080 4,404 8,134 Net cash inflow from returns on investments 13,080 4,404 8,134and servicing of finance Capital expenditure Purchase of tangible fixed assets - (5,505) (5,874) Net cash outflow for capital expenditure - (5,505) (5,874) Net cash outflow before financing (246,250) (54,877) (327,469) FinancingIssue of ordinary shares 3,500,000 550,000 800,000Expenses paid in connection with share issues (240,308) (100,596) 112,736 Cash inflow from financing 3,259,692 449,404 687,264 Increase in net cash in the period 3,013,442 394,527 359,795 India Outsourcing Services Plc Notes to the Interim Report 1. Basis of preparation The interim accounts for the six months ended 31 March 2006 are unaudited and donot constitute statutory accounts in accordance with section 240 of theCompanies Act 1985. The financial statements have been prepared in accordance with currentlyapplicable Accounting Standards in the United Kingdom, which have been appliedconsistently, and under the historical cost convention. Accounting policies consistent with those applied in the financial statementsfor the period ended 30 September 2005 have been used in preparing the unauditedinterim financial statements for the 6 months ended March 2006. 2. Taxation There is no tax charge for the period due to the loss arising. 3. Dividends The Directors are not declaring a dividend for the six months ended 31 March2006. 4. Loss per ordinary share The calculation of basic and diluted loss per share of 7.33 pence is based onthe loss for the period of £213,808 and on 2,915,064 ordinary shares, being theweighted average number of ordinary shares in issue during the period ended 31March 2006. The effect of all potential ordinary shares is antidilutive andtherefore dilutive EPS is the same as basic EPS. 5. Copies of interim results Copies of the interim results are available from the Company's office, 22 SohoSquare, London W1D 4NS. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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