Interim Results

24th Sep 2009 07:00



24 September 2009

SciSys plc

INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2009

SciSys ("SciSys" or "the Group") supplies IT services and bespoke IT systems to meet its clients' operational and business requirements. Its clients are primarily in the Space, Government and Media/Broadcast sectors and are predominantly blue chip companies, government and quasi-government organisations. Customers include the Environment Agency, the Ministry of Defence, Astrium, Arqiva, Cable & Wireless, the European Space Agency, the Metropolitan Police, the BBC, the RNLI, Deutsche Welle and the Coal Authority.

SciSys is listed on the AIM (stock code SSY).

Financial Highlights

Revenue up 5% to £20.3m (June 2008: £19.4m)

Adjusted operating profit doubled to £0.6m (June 2008: £0.3m) 

Profit before tax of £0.1m (June 2008: £0.5m loss)

Adjusted basic earnings per share up 31% to 2.1p (June 2008: 1.6p)

Basic earnings per share of 0.5p (June 2008: 0.6p loss)

Group net cash at 30 June 2009 of £1.3m (30 June 2008: £1.0m net debt)

Substantial working capital headroom of £4.3m 

Reintroduction of dividend payments with interim dividend declared of 0.3p per share

Operational Highlights

Underlying value of various new contract wins from established and new customers announced year to date in excess of £30m

Media and Broadcasting Division awarded major framework contract with the BBC worth £10ߛ15m between 2009- 2013

Post period end significant new client wins with the RNLI and UK Coal Authority

Mike Love, Chairman of SciSys, commenting on the results, said:

"Our results for the period confirm the progress made in our drive to return the Group to sustained profitable trading. Revenues and profits are in line with expectations. The flow of positive contract wins already announced to the market has given us a solid order book for the second half of 2009 and an excellent opening position for 2010. Our focus remains on the continued improvement in margins and the further strengthening of what is already a healthy order book position for 2010."

For further information please contact: 

SciSys plc
Mike Love	Executive Chairman	Tel : +44 (0) 1249 466 466
Chris Cheetham	Financial Director
Winningtons	Tom Cooper	T : +44 (0) 797 1221972
Canaccord Adams	Simon Bridges Adria Da Breo Richards	T : +44 (0) 20 7050 6500

Executive Chairman's Statement 

The headline message in our Annual Report for 2008 was that the turn around in the Group's fortunes was "On Track". In this 2009 Interim Report the Board is pleased to confirm that the Group remains on track, that results for the first six months of 2009 are in line with our expectations and that the trends within the business remain positive.

The Group has returned a profit after tax, finance costs, exceptional charges, all share based payments and the amortisation of intangible assets. We are able to report a solid net positive movement in the profits attributable to equity holders.

Adjusted operating profits for the period were up by 100% at £0.6m with revenues for the same period up by 5%. Our balance sheet remains strong with cash deposits exceeding borrowings by £1.3m as at the 30 June 2009.

Along with high levels of repeat business won from our established client base during the period, including major contract wins from the BBC and Environment Agency, there have also been post period end significant new client major contract awards with the RNLI and UK Coal Authority. The underlying value of the various new contract wins from established and new customers announced year to date is in excess of £30m. These contracts will help underpin our growth in 2010 and beyond.

For the RNLI, SciSys has been contracted to supply all of the software, hardware, installation and support services for its new fleet of lifeboats. The system will allow the crew of five to monitor and control all of the boats' functions from their seated crew stations and is based upon the Electronics Architecture product SciSys has been developing for the military for some years. The initial order, which is well in excess of £1m, is for the development and installation of the software architecture in the first five boats, although the RNLI may commission the software for additional boats over the next few years.

The initial value of the contract won with the Coal Authority for the analysis, design, development and implementation phases of a new geographic information system to replace the Authority's current Mining Reports and Surface Damage System, will be circa £5m. These phases are expected to collectively last two years and will be followed by several years of Service Management where SciSys will provide support and maintenance, technology refreshes and ongoing enhancements to the system.

SciSys remains organised around four divisions, each managed as a profit centre with its own executive team responsible for the profit and loss performance of the division.

 

Our Government Division has delivered the strongest performance across the period. It has made substantial positive progress in the delivery of a number of major projects to key clients including the Environment Agency, Arqiva, the Metropolitan Police and the Ministry of Defence, amongst others. In the corresponding period in 2008, progress was hindered by the need to engage a significant number of external contractors to assist in meeting delivery commitments. For 2009, we have been able to meet our delivery obligations almost entirely from our own permanent resources with corresponding positive impact on net margins. In addition to securing the RNLI and Coal Authority work, in April the Division also reported a major new project award win with the Environment Agency worth £3.5m over three years with options to extend its value over two further years. The work is to deliver the IT system for the Government's Carbon Reduction Commitment (CRC) Project. The CRC is part of the Government's initiative to tackle climate change through the introduction of a new 'cap & trade' system to encourage large distributed energy users in the public and private sectors to reduce energy usage. This is the first such system to be developed to address CRC and there is global interest in the UK's approach to use 'cap & trade' mechanisms.

Results from the Media and Broadcast Division (MBS) have continued to be held back in the first half of 2009 as the MBS Division experienced further delays in procurement decisions across its client base. However, in May it announced a major framework contract win for the provision of Audio Editing & Playout (AEP) solutions on a sole supplier basis to the BBC. It is anticipated that the value of the framework contract from 2009 to 2013 will be in the range of £10ߛ15m. Based on its dira!® product suite, MBS will be working to create one single scaleable  joined-up, pan-BBC solution that integrates with other systems to deliver to the BBC a true multimedia production environment. It is intended that the AEP systems will be installed across all of the BBC's sites, both within the UK and around the rest of the world. Although this contract win underpins the forward order book for MBS for the next three years, the Division will derive most of the value from this contract in 2010 and beyond. This win is strategically important as the delivery of the AEP programme will further strengthen MBS' position as a leading provider in the media broadcast business.

The Space Division, which was reorganised during 2008 to maximise the synergies between the SpaceCom business of VCS and the SciSys UK and SciSys German space businesses, is now operating as a single international division. At the operating level, underlying margins within the Division are under some pressure following delays in the completion of some projects within the UK. This issue is attracting substantial commercial focus from senior management. Overall most major programmes are continuing on schedule and have seen a number of substantial deliveries achieved during the period.

The Division has made significant progress in positioning itself to participate in future technology programmes. The more significant announcements in the period include its participation in an on-board security technology study and a contract for the development of a new area of expertise in navigation applications and services. A consortium led by the Space Division will build the basic infrastructure and test bed for the "navitestNRW" Service Infrastructure project. The project will create an infrastructure which will allow potential developers of future navigation-based application services an opportunity to test their ideas and equipment in a highly realistic environment. 

Other successes during the period include the use of the Mission Critical Operational Simulator developed by SciSys for the successful launch of the GOCE mission and the delivery of software into the SWARM and Cryosat 2 Earth Explorer satellites. Data collected from the GOCE satellite will provide a high-resolution map of the geoid and gravitational anomalies and will be used in ocean and climate studies, including sea-level changes, oceanic circulation and ice cap dynamics. The Division anticipates winning further work in this sector in the second half of the year. The SWARM and Cryosat 2 deliveries were completed on time and to budget and the working relationship with the customer has been excellent throughout.

 

SciSys' Support Division benefits from high levels of repeat business and has delivered another strong first half performance. It is well positioned to maintain the pattern in the second half. It secured a three year extendible contract with Transport for London (TfL) for the provision of application development, support and maintenance services for the software applications which are used in the production and printing of London's 64,000 Stop Specific Timetables, found at over 19,000 bus stops. This contract win further extends SciSys' presence in this key account and builds on the strong relationship it has with a growing number of business areas within TfL.

Going forward into 2010 the Division will see significant benefit from the RNLI, CRC and Coal Authority work. It will also potentially benefit from the AEP roll out activity working with the MBS division in supporting the BBC. 

Dividend

The Directors indicated at the AGM in May 2009 that the Board was considering reintroduction of dividend payments at the interim stage, subject to continued further positive progress at the operating level. They can now confirm that an interim dividend of 0.3p per share will be paid on 18 November 2009 to shareholders on the register as at 30 October 2009. The shares are expected to go ex-dividend on 28 October 2009.

Financial Director's Statement 

The total revenue for the Group was £20.3m (June 2008: £19.4m). Adjusted operating profit, before amortisation, share based payment charges and non-recurring items was £0.6m (June 2008: £0.3m) and adjusted basic earnings per share was 2.1p (June 2008: 1.6p). The statutory profit from operations was £0.1m (June 2008: loss of £1.0m). The profit before tax for the period was £0.1m (June 2008: loss £0.5m) and the basic earnings per share was 0.5p (June 2008: 0.6p loss).

I am pleased to report a return to profitability at the statutory operating, pre-tax and post-tax levels and a doubling of adjusted operating profit from the first half of 2008. All Divisions have made a contribution to the results for the period. The Government Division exhibited a particular resurgence from 2008, when its contribution was depressed due to the costs of external contractors engaged to ensure that the Division met critical project deadlines.

The amortisation charge shown on the face of the Income Statement relates to intangible assets recognised on the acquisition of VCS under IFRS and will cease at the end of 2009. The share based payment charge reflects the costs of the Group's Executive Share Ownership Plan and Enterprise Management Incentive schemes. Neither charge affected Group cashflow.

At the end of the reporting period, the Group had net cash (comprising cash and cash equivalents less overdrafts) of £2.8m (June 2008: £0.9m). Unutilised working capital facilities totalled £4.3m (June 2008: £1.7m).

UK bank facilities were renegotiated during the period. Overdraft facilities of £0.5m were converted to term debt and capacity for foreign exchange hedging cover was extended. Group debt excluding bank overdrafts at the period end was £1.5m (June 2008: £1.9m).

The resulting liquidity position was net cash of £1.3m (June 2008: £1.0m net debt). Adverse movement in exchange rates from the 2008 year end reduced the sterling value of Euro cash deposits held in Germany although the impact was mitigated by entry into Euro-sterling cylinder option contracts.

SciSys continues to benefit from the tax credit system for expenditure on Research & Development. The effective tax rate for the Group was a credit of 54% of pre-tax profit for the half year (June 2008: credit 66% of loss).

Comparative results for the six months ended 30 June 2008 have been restated to reflect accounting treatment for the disposal of CODA plc shares held in trust consistent with the presentation in the audited results for the year ended 31 December 2008. The half year accounts are presented on a basis consistent with policies to be adopted for the Annual Report and Accounts for the year ended 31 December 2009.

Outlook

We remain mindful of the uncertain market conditions which currently prevail across the software and IT services sector and continue to take a cautious view on our trading outlook. SciSys nevertheless is well positioned to meet expectations for the full year and can draw strength from the positive outlook it already has on 2010.

The Group needs to show further progress towards achieving the levels of financial performance that shareholders have historically expected. Our focus continues to be organic growth, the delivery of existing programmes, on improving net margins and on developing and strengthening our management team.

  

Consolidated Income Statement

	Unaudited Six months to 30 June 2009  £000	Restated Unaudited Six months to  30 June 2008  £000	Audited Year ended 31 December 2008  £000
Revenue (note 2)	20,281	19,422	38,056
Net operating costs	(20,172)	(20,451)	(39,859)
Operating profit/(loss)	109	(1,029)	(1,803)
"Adjusted operating profit" being operating profit/(loss) before amortisation, share based payments and non-recurring items	565	253	857
Amortisation of intangible assets	(428)	(900)	(1,800)
Share based payments	(28)	(135)	(161)
Non-recurring items (note 3)	-	(247)	(699)
Operating profit/(loss)	109	(1,029)	(1,803)
Finance costs	(56)	(314)	(296)
Finance income	32	853	935
Profit/(loss) before tax	85	(490)	(1,164)
Tax credit (note 4)	46	325	282
Profit/(loss) for the period	131	(165)	(882)
All profit/(loss) for the period is attributable to equity holders of the parent
Earnings/(loss) per share (note 5)
Basic	0.5p	(0.6)p	(3.1)p
Diluted	0.4p	(0.6)p	(3.1)p

  Consolidated Statement of Comprehensive Income

	Unaudited Six months to 30 June 2009  £000	Unaudited Six months to  30 June 2008  £000	Audited Year ended 31 December 2008  £000
Profit/(loss) for the period	131	(165)	(882)
Other comprehensive income
Currency translation differences on foreign currency investments	(830)	376	1,758
Net change in fair value of financial asset	-	73	73
Net change in fair value of financial asset transferred to Income Statement	-	(671)	(671)
Other comprehensive income	(830)	(222)	1,160
Total comprehensive income for the period attributable to equity holders of the parent	(699)	(387)	278

Consolidated Statement of changes in Equity

For the six months ended 30 June 2009
	Share Capital	Merger Reserve	Capital Redemption Reserve	Translation Reserve	Retained Earnings	TOTAL
	£000	£000	£000	£000	£000	£000
Balance as at 1 January 2009	7,120	943	83	2,173	4,636	14,955
Total comprehensive income for the period
Profit	-	-	-	-	131	131
Other comprehensive income
Foreign currency translation	-	-	-	(830)	-	(830)
Total comprehensive income for the period	-	-	-	(830)	131	(699)
Transactions with owners, recorded directly in equity
Contributions by and distributions to owners
Charge for share based payments	-	-	-	-	28	28
Investment in own shares	-	-	-	-	(4)	(4)
Total contributions by and distributions to owners	-	-	-	-	24	24
Balance as at 30 June 2009	7,120	943	83	1,343	4,791	14,280

  

For the six months ended 30 June 2008
	Share Capital	Merger Reserve	Capital Redemption Reserve	Available for Resale Reserve	Translation Reserve	Retained Earnings	TOTAL
	£000	£000	£000	£000	£000	£000	£000
Balance as at 1 January 2008	7,120	943	83	598	415	5,334	14,493
Total comprehensive income for the period
Loss	-	-	-	-	-	(165)	(165)
Other comprehensive income
Foreign currency translation	-	-	-	-	376	-	376
Remeasurement of available for resale asset	-	-	-	73	-	-	73
Sale of investments	-	-	-	(671)	-	-	(671)
Total comprehensive income for the period	-	-	-	(598)	376	(165)	(387)
Transactions with owners, recorded directly in equity
Contributions by and distributions to owners
Charge for share based payments	-	-	-	-	-	62	62
Share trust loans	-	-	-	-	-	100	100
Total contributions by and distributions to owners	-	-	-	-	-	162	162
Balance as at 30 June 2008	7,120	943	83	-	791	5,331	14,268

  

For the year ended 31 December 2008
	Share Capital	Merger Reserve	Capital Redemption Reserve	Available for Resale Reserve	Translation Reserve	Retained Earnings	TOTAL
	£000	£000	£000	£000	£000	£000	£000
Balance as at 1 January 2008	7,120	943	83	598	415	5,334	14,493
Total comprehensive income for the period
Loss	-	-	-	-	-	(882)	(882)
Other comprehensive income
Foreign currency translation	-	-	-	-	1,758	-	1,758
Remeasurement of available for resale asset	-	-	-	73	-	-	73
Sale of investments	-	-	-	(671)	-	-	(671)
Total other comprehensive income	-	-	-	(598)	1,758	-	1,160
Total comprehensive income for the period	-	-	-	(598)	1,758	(882)	278
Transactions with owners, recorded directly in equity
Contributions by and distributions to owners
Charge for share based payments	-	-	-	-	-	88	88
Share trust loans	-	-	-	-	-	100	100
Other	-	-	-	-	-	(4)	(4)
Total contributions by and distributions to owners	-	-	-	-	-	184	184
Balance as at 31 December 2008	7,120	943	83	-	2,173	4,636	14,955

  Consolidated Statement of Financial Position

	Unaudited 30 June 2009  £000	Unaudited 30 June 2008 £000	Audited 31 December 2008  £000
Non-current assets
Property, plant and equipment	3,927	3,807	4,285
Goodwill	5,603	5,603	5,603
Other intangible assets	542	1,841	1,004
Deferred tax assets	-	15	70
	10,072	11,266	10,962
Current assets
Inventories	368	439	316
Trade and other receivables	11,812	13,615	12,341
Income tax receivable	169	276	9
Cash and cash equivalents	3,423	3,113	4,144
	15,772	17,443	16,810
Total assets	25,844	28,709	27,772
Equity
Issued share capital	7,120	7,120	7,120
Share premium	943	943	943
Retained earnings	4,791	5,331	4,636
Translation reserve	1,343	791	2,173
Other reserves	83	83	83
Equity attributable to equity holders of the parent	14,280	14,268	14,955
Current liabilities
Trade and other payables	8,572	9,275	9,207
Bank overdraft and loans	1,182	3,191	1,696
Income tax payable	-	32	-
Deferred income	335	260	109
	10,089	12,758	11,012
Non-current liabilities
Bank loans	922	907	1,086
Deferred tax	553	776	719
	1,475	1,683	1,805
Total liabilities	11,564	14,441	12,817
Total equity and liabilities	25,844	28,709	27,772

  Consolidated Statement of Cash Flows

	Unaudited Six months to 30 June 2009  £000	Unaudited Six months to 30 June 2008  £000	Audited Year ended 31 December 2008  £000
Cash flow from operating activities
Profit/(loss) before tax	85	(490)	(1,164)
Net finance costs/(income)	24	(539)	(639)
Operating profit/(loss)	109	(1,029)	(1,803)
Decrease/(increase) in trade receivables	478	(1,871)	(473)
(Decrease)/increase in trade payables	(428)	965	1,046
Depreciation and amortisation	761	1,270	2,482
Profit on sale of property, plant and equipment	2	-	-
Share based payments	28	135	161
Tax paid	(130)	(376)	(431)
Net cash flow from operating activities	820	(906)	982
Cash flow from investing activities
Acquisition of subsidiary	-	-	(301)
Disposal of CODA plc shares	-	638	638
Proceeds from disposal of property, plant and equipment	8	50	144
Purchase of property, plant and equipment	(353)	(246)	(654)
Investment in own shares	(4)	-	-
Interest received	32	182	264
Net cash flow from investing activities	(317)	624	91
Cash flows from financing activities
Interest paid	(56)	(314)	(296)
Disposal of own shares	-	100	100
New bank loan	500	-	-
Debt repayments	(26)	(624)	(1,557)
Net cash flow from financing activities	418	(838)	(1,753)
Net increase/(decrease) in cash and cash equivalents	921	(1,120)	(680)
Cash and cash equivalents at the start of the period	2,508	1,700	1,700
Exchange and other movements	(635)	290	1,488
Cash and cash equivalents at the end of the period	2,794	870	2,508
Cash and cash equivalent deposits held in non-UK based banks	3,423	3,113	4,144
Net bank overdraft with UK based banks	(629)	(2,243)	(1,636)
	2,794	870	2,508

  Notes to the Unaudited Interim Report

Basis of preparation of Interim Financial Information & Statement of Compliance

SciSys plc (the "Company") is a UK company incorporated in England & Wales. The consolidated half year financial statements of the Company for the six months to 30 June 2009 comprise the Company and its subsidiaries (together referred to as the "Group"). The Group reports its financial results in accordance with International Financial Reporting Standards ("IFRS") as adopted by the European Union.

This interim results announcement is prepared in accordance with the IFRS accounting policies expected to be applied by the Group at 31 December 2009. These policies are unchanged from those set out by the Group in its consolidated financial statements for the year ended 31 December 2008 and available on the Group's website at www.scisys.co.uk. As permitted, this interim report has been prepared in accordance with the AIM rules and not in accordance with IAS 34 'Interim Financial Reporting' and is therefore not fully compliant with IFRS.  The following accounting standards have been adopted for the first time in this report: IFRS 8 - Operating Segments and IAS 1 (Revised) - Presentation of Financial Statements (2007). Two further new standards, IAS 23 - Borrowing Costs and IFRS 2 (Revised) - Share Based Payments, had no impact on the financial results nor on their presentation. 

The interim financial information for the six months ended 30 June 2009 is unaudited and does not include all of the information required to constitute statutory accounts within the meaning of section 240 of the Companies Act 1985. It should therefore be read in conjunction with the audited financial statements for the year ended 31 December 2008. These published accounts have been reported on by the Group's auditors and have been delivered to the Registrar of Companies. The report of the auditors was (1) unqualified; (2) did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report and (3) did not contain a statement under sections 237(2) or (3) of the Companies Act 1985.

The preparation of these consolidated half year financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates. In preparing these consolidated half year financial statements, the significant judgements made by management in applying the Group's accounting policies and the key areas of estimation were the same as those that applied to the consolidated financial statements for the year ended 31 December 2008.

The Interim Report was approved by the Directors on 16 September 2009. 

   2. Segmental analysis

The Group operates in one segment, that of providing IT services to large corporations and public sector organisations. Internal management reports analyse results by operating division as set out in the following table. No distinction is drawn between different geographical territories of operation.

Information about reportable segments
External revenues	Space	Govern-ment	Media & Broadcast	Support	Total
	£000	£000	£000	£000	£000
For the six months ended 30 June 2009
External revenue for reportable segments	7,761	7,192	3,661	1,487	20,101
Other external revenue					180
Consolidated revenue					20,281
For the six months ended 30 June 2008
External revenue for reportable segments	8,738	5,549	3,135	1,612	19,034
Other external revenue					388
Consolidated revenue					19,422
For the year ended 31 December 2008
External revenue for reportable segments	16,739	11,081	6,757	3,153	37,730
Other external revenue					326
Consolidated revenue					38,056

  

Profit/(loss) before tax	Space	Govern-ment	Media & Broadcast	Support	Total
	£000	£000	£000	£000	£000
For the six months ended 30 June 2009
Reportable segment contribution	1,120	1,872	550	246	3,788
Central overheads					(3,679)
Finance costs					(56)
Finance income					32
Profit before income tax					85
For the six months ended 30 June 2008
Reportable segment contribution	2,061	469	724	476	3,730
Central overheads					(4,759)
Finance costs					(314)
Finance income					853
Loss before income tax					(490)
For the year ended 31 December 2008
Reportable segment contribution	2,870	1,058	1,635	690	6,253
Central overheads					(8,056)
Finance costs					(296)
Finance income					935
Loss before income tax					(1,164)
Group assets	Space	Govern-ment	Media & Broadcast	Support	Total
	£000	£000	£000	£000	£000
As at 30 June 2009
Reportable segment - non-current assets	2,223	-	3,380	-	5,603
Reportable segment - current assets	5,276	3,317	987	503	10,083
	7,499	3,317	4,367	503	15,686
Other - non-current assets					4,469
Other - current assets					5,689
Total assets					25,844
As at 30 June 2008
Reportable segment - non-current assets	2,223	-	3,380	-	5,603
Reportable segment - current assets	5,217	4,665	1,923	540	12,345
	7,440	4,665	5,303	540	17,948
Other - non-current assets					5,663
Other - current assets					5,098
Total assets					28,709
As at 31 December 2008
Reportable segment - non-current assets	2,223	-	3,380	-	5,603
Reportable segment - current assets	4,878	3,911	2,110	744	11,643
	7,101	3,911	5,490	744	17,246
Other - non-current assets					5,359
Other - current assets					5,167
Total assets					27,772

  

Group liabilities	Space	Govern-ment	Media & Broadcast	Support	Total
	£000	£000	£000	£000	£000
As at 30 June 2009
Reportable segment - current liabilities	1,631	433	487	684	3,235
Other - non-current liabilities					1,475
Other - current liabilities					6,854
Total liabilities					11,564
As at 30 June 2008
Reportable segment - current liabilities	1,137	285	1,047	470	2,939
Other - non-current liabilities					1,683
Other - current liabilities					9,819
Total liabilities					14,441
As at 31 December 2008
Reportable segment - current liabilities	907	272	1,289	629	3,097
Other - non-current liabilities					1,805
Other - current liabilities					7,915
Total liabilities					12,817

3. Non-recurring items 

	Unaudited Six months to 30 June 2009  £000	Unaudited Six months to  30 June 2008  £000	Audited Year ended 31 December 2008  £000
Restructuring costs	-	247	699

Restructuring costs comprise severance payments to employees who left the Group on grounds of redundancy under a programme commenced in September 2007 to align operating costs with projected revenues, together with directly attributable professional advisors fees and external consultancy costs for short term strengthening of the management team

  4. Taxation

	Unaudited Six months to 30 June 2009  £000	Unaudited Six months to  30 June 2008  £000	Audited Year ended 31 December 2008  £000
Current tax (credit)/charge	(10)	(135)	100
Deferred tax credit	(36)	(190)	(382)
Total	(46)	(325)	(282)

The credit for taxation for the six months ended 30 June 2009 reflects the anticipated effective rate for the period.

5. Earnings per share 

The calculation of the Group basic and diluted earnings per ordinary share is based on the following data:

	Unaudited Six months to 30 June 2009  £000	Unaudited Six months to  30 June 2008  £000	Audited Year ended 31 December 2008  £000
Profit/(loss) attributable to shareholders	131	(165)	(882)

Number of shares	'000	'000	'000
Basic weighted average number of shares	28,394	27,837	28,124
Diluted weighted average number of shares	29,719	28,848	29,460

The weighted average number of shares for the calculation of basic earnings per share excludes own shares held in treasury and in the SciSys No1 Employee Share Trust which have been awarded under the Executive Share Ownership Plan.

The weighted average number of shares for the calculation of diluted earnings per share includes own shares held in treasury and in the SciSys No1 Employee Share Trust which have been awarded under the Executive Share Ownership Plan and outstanding options during the period granted under the Enterprise Management Incentive Scheme and Company Share Option Plan. To the extent to which these result in a lower loss per share, they are excluded from the calculation of diluted earnings per share. 6. Adjusted earnings per share

 

	Unaudited Six months to 30 June 2009  £000	Unaudited Six months to  30 June 2008  £000	Audited Year ended 31 December 2008  £000
Basic	2.1p	1.6p	3.9p
Diluted	2.0p	1.5p	3.8p

In order to present a measure of earnings per share which is more representative of the Group's underlying operating performance, earnings are adjusted to be net of the costs shown in the highlighted box on the face of the Income Statement and of the finance income deriving from realisation of the available for sale reserve.

The calculation of the Group adjusted basic and diluted earnings per ordinary share is based on the number of shares in Note 5 and the following earnings data:

	Unaudited Six months to 30 June 2009  £000	Unaudited Six months to  30 June 2008  £000	Audited Year ended 31 December 2008  £000
Profit/(loss) attributable to shareholders	131	(165)	(882)
Adjusted for:
Amortisation of intangible assets	428	900	1,800
Share based payments	28	135	161
Non-recurring items (note 3)	-	247	699
Realisation of available for resale reserve	-	(671)	(671)
Adjusted earnings	587	446	1,107

The weighted average number of shares for the calculation of basic adjusted earnings per share excludes own shares held in treasury and in the SciSys No1 Employee Share Trust which have been awarded under the Executive Share Ownership Plan.

The weighted average number of shares for the calculation of diluted adjusted earnings per share includes own shares held in treasury and in the SciSys No1 Employee Share Trust which have been awarded under the Executive Share Ownership Plan and outstanding options during the period granted under the Enterprise Management Incentive Scheme and Company Share Option Plan. To the extent to which these result in a lower loss per share, they are excluded from the calculation of diluted adjusted earnings per share.

7. Dividends 

No dividends were paid in respect of 2008. The Board is recommending payment of an interim dividend for 2009 of 0.3p per share.

Interim Report

The Interim Report will be posted to shareholders shortly and copies will be available from SciSys plc's Registered Office at Methuen Park, Chippenham, Wiltshire, SN14 0GB. It will also be available on the SciSys website at www.scisys.co.uk. 

ENDIR BXLFLKKBEBBK

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