Half-year Report

Source: RNS
RNS Number : 1645B
Pebble Beach Systems Group PLC
21 August 2024
 

Pebble Beach Systems Group plc

Results for the half-year ended 30 June 2024

 

Pebble Beach Systems Group plc (AIM: "PEB", "Pebble" or the "Group"), a leading global software business specialising in playout, content management, and IP Control solutions for the broadcast and media technology markets, is pleased to announce its unaudited half-year results for the six months ended 30 June 2024 ("H1 24").

 

Financial highlights

·      Order intake in the period was up 12% year on year to £4.9m (H1 23: £4.4m)

·      Service Level Agreement ("SLA") revenue up 21% to £3.1m (H1 23: £2.5m) as a result of the on-going SLA price rises that have been implemented by the Group. As a result, higher margin recurring revenue accounted for 58% of total Group revenue in the period (H1 23: 46%). Overall Group revenue for the six months to 30 June 2024 was £5.3m (H1 23: £5.5m)

·      Adjusted EBITDA1 of £1.4m (H1 23: £1.4m) was flat against H1 last year, but with an improved EBITDA margin of 27% from increased level of higher margin SLA recurring revenue (H1 23: 25%)

·      Profit before tax of £0.3m (H1 23: £0.2m)

·      Adjusted earnings per share up to 0.3p (H1 23: 0.2p)

·      Net cash generated from operating activities (after interest paid) £1.2m (H1 23: £1.7m)

·      Gross bank debt reduced by £0.5m in last six months to £5.1m as at 30 June 2024. Net debt at 30 June 2024 was £4.8m (H1 23: £5.1m) (excluding IFRS 16 leases) representing a net debt/last 12 month Adjusted EBITDA1 of c.1.3x

 

Operational highlights

·      Launched new IP-native PRIMA platform at the NAB trade show in Las Vegas. Investment in increasing the feature set for PRIMA has continued as planned.

·      Investment in the Group's sales team to drive revenues; Sally Wallington appointed as SVP of Sales. Sally brings 20 years of industry sales experience and will drive our projected increase in project orders. In addition to Sally, the Group has strengthened its presence in Europe with the appointment of a new VP of Sales in the DACH region.

·      We continue to adjust the prices of our SLAs to ensure charges are at the appropriate level for the standard of support, which has driven the increase in our recurring revenue and a stronger revenue mix. This has resulted in more multi-year SLA renewal orders being placed.

 

Current trading and outlook

·      The Group's weighted pipeline value remains strong at £9.8m, 13% up on last year's value (June 23: £8.7m).

·      In line with previous years and based on the strength of the weighted pipeline, we are expecting to deliver 2024 market expectations.

·      Reduced hardware lead times and operational readiness means project orders landed in H2 can be turned around quickly and delivered before the end of the year.

·      Increased number of multi-year SLAs booked, giving better visibility of future revenues.

 

John Varney, Non-Executive Chairman of Pebble Beach Systems Group plc, said:

 

"The Group continues to demonstrate resilience with increased order intake in spite of ongoing challenging external market conditions causing customers to continue delaying decisions on upgrades. The Group entered H2 2024 with a strong sales pipeline alongside improved visibility (and value) of recurring revenues. The Board is expecting to deliver against market expectations for the year with the expectation that there will be increased project orders placed in H2 2024 based on historical trends and a strong order book.

 

Given the continued momentum being seen by the Group, the Board is focused on driving further organic growth complemented by inorganic growth, when appropriate, as opportunities to enhance our technology are identified. We continue to progress with investment in the development of our new solutions to help support the industry in its transition to IP and I am confident PRIMA will be the best product to support the inevitable full-scale adoption".

 

 

 

For further information please contact:

 

Peter Mayhead - CEO

 


+44 (0) 75 55 59 36 02

 

 

Cavendish Capital Markets Limited (Nominated Adviser and Broker)

Marc Milmo / Teddy Whiley - Corporate Finance

 

+44 (0) 207 220 0500 

Tim Redfern / Sunila de Silva - ECM


 

The Company is quoted on the LSE AIM market (PEB.L).  More information can be found at www.pebbleplc.com.

About Pebble Beach Systems

 

Pebble Beach Systems (trading as Pebble) is a world leader in designing and delivering automation, integrated channel and virtualised playout solutions, with scalable products designed for applications of all sizes. Founded in 2000, Pebble has commissioned systems in more than 70 countries, with proven installations ranging from single up to over 150 channels in operation, and around 2000 channels currently on air under the control of our automation technology. An innovative, agile company, Pebble is focused on discovering its customers' requirements and pain points, designing solutions which will address these elegantly and efficiently, and delivering and supporting these professionally and in accordance with its users' needs.

 

Forward-looking statements

Certain statements in this announcement are forward-looking. Although the Group believes that the expectations reflected in these forward-looking statements are reasonable, it can give no assurance that these expectations will prove to be correct. Because these statements involve risks and uncertainties, actual results may differ materially from those expressed or implied by these forward-looking statements. The Group undertakes no obligation to update any forward-looking statements whether as a result of new information, future events or otherwise. Nothing in this announcement should be construed as a profit forecast.

 

 

 

 

CHAIRMAN'S STATEMENT

 

In what has been a challenging market for orders, the Group is pleased to report a 12% increase in overall orders received. Importantly this has been driven by a 22% increase in our SLA orders following the price rise exercise undertaken and an increase in multi year SLA orders. The increase in SLAs continues to improve visibility of future revenue.

 

Despite the upturn in orders, revenue for H1 24 was 4% down on H1 last year. This is a result of delays to project orders in H1 being pushed back to H2. However, the Board is encouraged by the Group's visibility of these orders and expects a strong second half and meeting its expectations for FY24.   

 

The Group has managed its cost base to ensure the project order delays have not adversely impacted the Group's Adjusted EBITDA margin and I am pleased to report a H1 Adjusted EBITDA margin of 27% (H1 FY23: 25%). The forecasted increase in H2 revenue gives the Board confidence that full year Adjusted EBITDA margin will be at 31% in line with expectations.

 

The Group has continued to pay down the long-term debt, and although net debt (excluding IFRS 16 leases) of £4.8m is flat with the FY23 year end position, the Board is pleased to see net debt is 6% down on last year's net debt position (H1 23: £5.1m).

 

Revenue was 4% down on the comparative period totalling £5.3m (H1 23: £5.5m). This is a result of project revenue being £0.8m less then H1 23 (H1 2023 £3.0m) on the back of the reduction in project orders. The project order reduction has been mitigated by the SLA price rises resulting in a higher recurring revenue of £3.1m (H1 2023: £2.5m).

 

Higher Adjusted EBITDA margins are achievable on recurring software revenues, therefore with a focus on increasing the mix of recurring software revenues and the usual cycle of higher project revenue in the second half of the year, the Group remains on target for a strong H2. Recurring revenue is up 21% and now accounts for 58% of revenue base (H1 23: 46%). This is encouraging for future years' revenue.

 

Adjusted EBITDA1 marginally increased to £1.40m (H1 23: £1.36m), representing a 3% increase on H1 23 following the change in revenue mix mentioned above, as well as careful control of costs. Adjusted EBITDA margin is higher at 27% (H1 23: 25%), and we expect to maintain this as we continue to focus on increasing the mix of recurring software revenue.

 

Cash conversion in H1 24 has remained strong with 101% of adjusted EBITDA being converted to operating cash (H1 23: 145%). The reduced cash conversion has been driven by the reduction in project orders delivered in the period, which have a large upfront payment. SLA orders are often paid over the length of the contract.

 

Net cash from operating activities (after interest paid) fell to £1.2m (H1 23: £1.7m); despite this the Group has continued its investment in R&D and paying down the long-term debt.

 

A net debt position of £4.8m (excluding IFRS 16 leases) represents a 6% reduction from the comparable period last year (H1 23: £5.1m). Despite the lower cash generation, although still over 100% cash conversion, to the comparable period last year the Group has continued to pay off the long-term debt at the same rate as last year.

The Group invested £1.2m in R&D in the period (H1 23: £0.9m) as it continues to develop software which can be sold on a recurring basis whilst continuing to maintain and develop our existing product range.

 

A decrease in financing costs as a result of lower bank service charges and slightly less interest as borrowing has reduced, has resulted in a net profit of £0.29m (H1 23: £0.24m). The current interest rate on loan repayments is 9.10% (H1 23: 8.22%). This has resulted in an adjusted EPS of 0.3p (H1 23: 0.2p).

The year-on-year order increase saw H1 24 orders come in at £4.9m (H1 23: £4.4m), driven by an increase in SLA orders as a result of the price rise exercise. SLA orders of £2.7m are 22% up on last year's H1 intake (H1 23: £2.2m).

 

We are still seeing delays in customers placing project orders, which is in line with previous years, and is a symptom of the current global market conditions. Project orders of £2.2m for H1 is flat on last year's project order intake (H1 23: £2.2m). We entered the year with a lower project backlog now that hardware lead times have been reduced. However, given the weighted pipeline value for expected orders is 13% up on last year's value, the Group expects to deliver a stronger H2 of project order intake.

 

Pebble Control has been integrated onto the PRIMA platform and has been rebranded PRIMA Control. The solution now focuses on IP and stream management for PRIMA applications and will no longer be available as a standalone solution.

 

Ongoing software development

 

·      PRIMA: Work continues on a cloud-native playout solution to complement our current enterprise level automation offering.

·      Media Processing Engine: Work is progressing on the software solution for video playout capability with preliminary integration with Oceans Automation achieved. The next milestones will include APIs, graphics management and subtitling.

 

 

 

Cash flows and net debt

 

The Group held cash and cash equivalents of £0.2 million at 30 June 2024 (H1 23: £0.9 million). The table below summarises the cash flows for the half year.


2024

2023


£'m

£'m




Cash generated from operating activities

1.1

1.6

Net cash used in investing activities

(1.2)

(0.9)

Net cash used in financing activities

(0.5)

(0.5)

Net (decrease)/increase in cash and cash equivalents

(0.6)

0.2

Cash and cash equivalents at 1 January

0.8

0.7

Cash and cash equivalents at 30 June

0.2

0.9

 

As at 30 June 2024 net debt (including IFRS 16 leases) was £4.9m (cash £0.2m and bank debt of £5.1m and IFRS 16 leases of £0.1m). The Group was using all £5.1m of its available facilities at 30 June 2024, having re-paid £0.5m in the period.

The directors are required to assess the Group's ability to continue to trade as a going concern. The Board concluded, from its thorough assessment of the detailed forecasts, that the Group will have sufficient resources to meet its liabilities during the review period through to 31 December 2025 and that it is appropriate that the Group prepare accounts on a going concern basis (see note 3 below).

Principal risks and uncertainties 

 

The principal risks and uncertainties facing the Group remain consistent with the principal risks and uncertainties reported in the Group's 31 December 2023 Annual Report.


Current trading and outlook

 

The Group entered H2 2024 with a strong sales pipeline alongside improved visibility (and value) of recurring revenues. The Board expects to deliver against its targets for the year with the expectation that there will be increased project orders placed in H2 2024 based on historical trends and a strong order book.

 

The Board is pleased to see the SLA price rise exercise having a positive effect on business performance and providing a stronger recurring revenue mix. This will continue to give improved visibility of future revenue, which gives confidence of future trading. This increased recurring revenue is supporting our transition to an OPEX business.

 

The Board is pleased with the expansion of the sales team to help convert the opportunities that we have in the pipeline into orders. This will also drive an increase in the number of potential opportunities and increase new business. The Board is focused on driving further Group organic growth and will look to complement this by appropriate inorganic growth as opportunities to enhance our technology offering are identified. Furthermore, we continue to progress with investment in the development of our new solutions to help support the industry.

 

 

John Varney

Non-Executive Chairman

 

 

 

 

CONSOLIDATED INCOME STATEMENT

for the half year ended 30 June 2024

 



6 months to 30 June 2024

6 months to 30 June 2023

Year ended 31 December

2023



(Unaudited)

(Unaudited)

(Audited)


Notes

£'000

£'000

£'000






Revenue

4

5,256

5,468

12,370

Cost of sales


(1,145)

(1,417)

(2,826)

Gross profit


4,111

4,051

9,544

Sales and marketing expenses


(1,443)

(1,289)

(2,747)

Research and development expenses


(776)

(884)

(1,739)

Administrative expenses


(1,285)

(1,304)

(2,983)

Foreign exchange gains/(losses)


(21)

(35)

(31)

Other expenses


(37)

-

(105)

Operating profit

5

549

539

1,940

Operating profit is analysed as:





Adjusted EBITDA


1,400

1,358

3,773

Non-recurring items


(37)

-

(105)

Share based payment expense


--

(28)

(57)

Exchange gains/(losses) credited/(charged) to the income statement


(21)

(35)

(31)

Earnings before interest, tax, depreciation and amortisation (EBITDA)


1,342

1,295

3,580

Depreciation


(82)

(122)

(200)

Amortisation of capitalised development costs


(711)

(634)

(1,305)

Finance costs


(255)

(291)

(531)

Profit before tax


294

248

1,544

Tax

6

(4)

(6)

(10)

Profit for the period being attributable to owners of the parent


290

242

1,534






Earnings per share

attributable to the owners of

the parent during the period

 





Basic earnings per share

7

0.2p

0.2p

1.2p






Diluted earnings per share





Diluted earnings per share

7

0.2p

0.2p

1.2p

 

 

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

for the half year ended 30 June 2024

 



6 months to 30 June 2024


6 months to 30 June 2023

Year ended 31 December

2023



(Unaudited)


(Unaudited)

(Audited)




£'000


£'000

£'000



 

 





Profit for the financial year

 

290


242

1,534


Other comprehensive income - items that may be reclassified subsequently to profit or loss:

 

 





Exchange differences on translation of overseas operations

 

-


3

9



 

 





Total profit for the period attributable to owners of the parent

 

290


245

1,543

 

 

CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY

for the half year ended 30 June 2024

 

 


 

Ordinary shares 

£000

 

Share

premium

£000

Capital

redemption

reserve

£000

 

Merger

reserve

£000

 

Translation

reserve

£000

 

Accumulated losses

£000

 

 

Total

£000

At 1 January 2024

3,115

6,800

617

29,778

(176)

(39,281)

853

Share based payments: value of employee services

-

-

-

-

-

-

-

Transactions with owners

-

-

-

-

-

-

-

Retained profit for the period

-

-

-

-

-

290

290

Exchange differences on translation of overseas operations

-

-

-

-

-

-

-

Total comprehensive income/expense for the period

-

-

-

-

-

290

290

At 30 June 2024 (Unaudited)

3,115

6,800

617

29,778

(176)

(38,991)

1,143

At 1 January 2023

3,115

6,800

617

29,778

(185)

(40,872)

(747)

Share based payments: value of employee services

-

-

-

-

-

28

28

Transactions with owners

-

-

-

-

-

28

28

Retained profit for the period

-

-

-

-

-

242

242

Exchange differences on translation of overseas operations

-

-

-

-

3

-

3

Total comprehensive income/expense for the period

-

-

-

-

3

242

245

At 30 June 2023 (Unaudited)

3,115

6,800

617

29,778

(182)

(40,602)

(474)

At 1 January 2023

3,115

6,800

617

29,778

(185)

(40,872)

(747)

Share based payments: value of employee services

-

-

-

-

-

57

57

Transactions with owners

-

-

-

-

-

57

57

Retained profit for the year

-

-

-

-

-

1,534

1,534

Exchange differences on translation of overseas operations

-

-

-

-

9

-

9

Total comprehensive income/expense for the period

-

-

-

-

9

1,534

1,543

At 31 December 2023 (Audited)

3,115

6,800

617

29,778

(176)

(39,281)

853









 

 

 

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

as at 30 June 2024

 



30 June 2024

30 June 2023

31 December

2023



(Unaudited)

(Unaudited)

(Audited)


Notes

£'000

£'000

£'000

Assets





Non-current assets





Intangible assets

8

7,561

6,615

7,107

Property, plant and equipment


364

496

435

Other non-current assets


12

12

12



7,937

7,123

7,554

Current assets





Inventories


371

491

303

Trade and other receivables


3,429

3,330

4,318

Current tax assets


-

-

-

Cash and cash equivalents


246

951

796

 


4,046

4,772

5,417

Liabilities





Current liabilities





Financial liabilities - borrowings


1,000

1,000

1,000

Trade and other payables


5,669

6,039

6,169

Lease liabilities - current


51

63

47



6,720

7,102

7,216






Net current liabilities


(2,674)

(2,330)

(1,799)






Non-current liabilities





Financial liabilities - borrowings


4,050

5,050

4,550

Lease liabilities - non-current


70

217

352

Deferred tax liabilities


-

-

-



4,120

5,267

4,902

 





Net asset/(liabilities)


1,143

(474)

853

 

 

Equity attributable to owners of the parent





Ordinary shares


3,115

3,115

3,115

Share premium account


6,800

6,800

6,800

Capital redemption reserve


617

617

617

Merger reserve


29,778

29,778

29,778

Translation reserve


(175)

(182)

(176)

Retained earnings


(38,992)

(40,602)

(39,281)

Total equity


1,143

(474)

853

 

 

 

 

 

CONSOLIDATED STATEMENT OF CASH FLOWS

for the half year ended 30 June 2024

 








6 months to 30 June 2024

6 months to 30 June 2023

Year ended 31 December

2023



(Unaudited)

(Unaudited)

(Audited)


Notes

£'000

£'000

£'000

Cash flows from operating activities





Cash generated from operations

9

1,415

2,030

3,917

Interest paid


(255)

(291)

(531)

Taxation paid


-

2

(8)

Net cash from operating activities


1,160

1,741

3,378

 





Cash flows from investing activities





Interest received


-

-

-

Purchase of property, plant and equipment


(41)

(23)

(68)

Expenditure on capitalised development costs


(1,165)

(942)

(2,105)

Net cash used in investing activities


(1,206)

(965)

(2,173)






Cash flows from financing activities





Net cash used in repayment of financing activities


(500)

(500)

(1,000)

Principal elements of lease payments


(4)

(56)

(96)

Net cash used in financing activities


(504)

(556)

(1,096)

Net (decrease)/increase in cash and cash equivalents


(550)

220

109

Effect of foreign exchange rate changes


-

3

(41)

Cash and cash equivalents and overdrafts at 1 January


796

728

728

Cash and cash equivalents and overdrafts at period end


246

951

796

 





Net debt (excluding IFRS 16 leases) comprises:





Cash and cash equivalents and overdrafts


246

951

796

Borrowings


(5,050)

(6,050)

(5,550)

Net debt (excluding IFRS 16 leases) at period end


(4,804)

(5,099)

(4,754)

 

 

 

 

 

NOTES TO THE HALF-YEAR REPORT

for the six months ended 30 June 2024

 

1.   GENERAL INFORMATION

 

The Pebble Beach Systems Group is a leading global software business specialising in playout, content management, and IP control solutions for the broadcast and media technology markets.

 

The Company is a public limited company and is quoted on the Alternative Investment Market (AIM) of the London Stock Exchange. The Company is incorporated and domiciled in the UK, with registered number of   04082188. The address of its registered office is Unit 1, First Quarter, Blenheim Road, Epsom, Surrey, KT19 9QN. 

 

This half-year results announcement was approved by the Board on 20 August 2024.

 

2.   BASIS OF PREPARATION

 

The financial information for the period ended 30 June 2024 set out in this half-year report does not constitute statutory accounts as defined in Section 434 of the Companies Act 2006. The Group's statutory financial statements for the year ended 31 December 2023 have been filed with the Registrar of Companies. The auditor's report on those financial statements was unqualified.

The half-year financial information has been prepared using the same accounting policies and estimation techniques as will be adopted in the Group financial statements for the year ending 31 December 2024. The Group financial statements for the year ended 31 December 2023 were prepared under UK-adopted international accounting standards. These interim financial statements have been prepared on a consistent basis and format. The Group has not applied IAS 34 'Interim Financial Reporting', which is not mandatory for AIM companies, in the preparation of these interim financial statements.

3.   GOING CONCERN

 

The directors are required to assess the Company's and the Group's ability to continue to trade as a going concern.

To assess the appropriateness of preparing financial statements on a going concern basis, management prepared detailed projections of the consolidated statement of profit and loss, the statement of financial position and cash flow statements through to 31 December 2025. This review period extends to the end of the financial year for 2025, which is looking forward 16 months beyond the date of approval of these financial statements. The projections included testing against the minimum liquidity and cash flow cover covenants required by the new term loan facility.

The projections used the forecast for 2024 and were updated for current trading and forecasts. This analysis was then extended to the end of 2025. The projections were stress tested in two ways. Project orders for 2024 were reduced by 50%, then reduced by 40% with a 25% reduction in SLA renewals in 2024 applied. The existing support service contracts, where revenue is recognised over time were assessed based on historic renewal rates, to establish the likely renewal of this recurring revenue. Management reviewed the resource levels and marketing spend required to support the reduced revenue and reflected cost reductions in the forecast. Even with a 25% drop in SLA renewals, management concluded the business will remain a going concern. The Board has concluded from its thorough assessment of the detailed forecasts and ability to enact any mitigating actions, if required, that the Group will have sufficient resources to meet its liabilities during the review period through to 31 December 2025, that it will meet the bank covenants and that it is appropriate that the Group and the Company prepare accounts on a going concern basis.

We enjoy a close relationship with our bank and have regular review meetings with them. In March 2024, we signed a new term loan through to 30 October 2026, which re-financed the existing £5.5m million RCF at the same level of commitment, with repayment levels consistent with previous years and appropriate financial covenants. There have been no breaches in financial covenants to date and no breaches are anticipated in the going concern period. However, both of the financial covenants in relation to the minimum liquidity and cash flow cover are sensitive to changes in the timing of project orders being placed and SLA renewals continuing to slip during the price negotiation. Management have concluded that that this timing delay is short term only and cashflow levels are expected to increase in the next few months. The Board has concluded, based on review, challenge and prior experience, that management will be able to manage working capital movements appropriately such that covenants will not be breached in the period assessed. Management also had to manage working capital movements in quarter one 2024 to ensure there were no breaches in covenants.  Management has estimated the timing of cash receipts and identified mitigating actions to be taken in the event of a breach becoming likely. Management's ability to enact these mitigating actions and their effectiveness are considered significant judgements.

The directors are confident that any loan extensions required post October 2026 would be granted given the historic track record.

 

4.   SEGMENTAL REPORTING

 

The Group's internal organisational and management structure and its system of internal financial reporting to the Board of Directors comprise of Pebble Beach Systems Limited and Group. The chief operating decision-maker has been identified as the Executive.

 

The Board reviews the Group's internal financial reporting in order to assess performance and allocate resources. Management have therefore determined that the operating segments for the Group will be based on these reports.

 

The Pebble Beach Systems Limited business is responsible for the sales and marketing of all Group software products and services.

 

The table below shows the analysis of Group external revenue and operating profit by business segment.

 

 


Pebble Beach Systems

Group

Total

 


£'000

£'000

£'000

6 months to 30 June 2024 (Unaudited)




Total revenue

5,256

-

5,256





Adjusted EBITDA

1,634

(234)

1,400

Depreciation

-

(82)

Amortisation of capitalised development costs

(711)

-

(711)

Non-recurring items

(37)

-

(37)

Exchange gains

(21)

-

(21)

Finance costs

(5)

(250)

(255)

Finance income

149

(149)

-

Profit/(loss) before taxation

927

(633)

294

Taxation

(4)

-

(4)

Profit/(loss) for the period being attributable to owners of the parent

923

(633)

290

6 months to 30 June 2023 (Unaudited)




Total revenue

5,468

-

5,468





Adjusted EBITDA

1,555

(197)

1,358

Depreciation

-

(122)

Amortisation of capitalised development costs

(634)

-

(634)

Share based payment expense

-

(28)

(28)

Non-recurring items

-

-

-

Exchange gains

(35)

-

(35)

Finance costs

(5)

(286)

(291)

Finance income

131

(131)

-

Profit/(loss) before taxation

890

(642)

248

Taxation

(6)

-

(6)

Profit/(loss) for the period being attributable to owners of the parent

884

(642)

242

Year to 31 December 2023 (Audited)




Total revenue

12,370

-

12,370





Adjusted EBITDA

4,221

(448)

3,773

Depreciation

(200)

-

(200)

Amortisation of capitalised development costs

-

(1,305)

Share based payment expense

-

(57)

(57)

Non-recurring items

(105)

-

(105)

Exchange (losses)/gains

(31)

-

(31)

Finance costs

(10)

(521)

(531)

Intercompany finance income/(costs)            

336

(336)

-

Profit/(loss) before taxation

2,906

(1,362)

1,544

Taxation

(10)

-

(10)

Profit/(loss) for the year being attributable to owners of the parent

2,896

(1,362)

1,534

 

 

 

 

 

Geographic external revenue analysis

 

The revenue analysis in the table below is based on the geographical location of the customer of the business.

 

 


6 months to 30 June

2024

(Unaudited)

6 months to 30 June

2023

(Unaudited)

Year ended 31 December

2023

(Audited)


 




Total

£'000

Total

£'000

Total

£'000

By market




UK & Europe

2,921

3,362

6,381

North America

735

497

1,376

Latin America

304

350

1,092

Middle East

1,170

1,151

3,055

Asia / Pacific

126

108

466


5,256

5,468

12,370

 

 

Net assets/(liabilities)

 

The table below summarises the net liabilities of the Group by division. Balance sheet reporting is disclosed by the divisional assets and liabilities of the Group as this is consistent with the presentation of internal information provided to the Executive Management Board and the Board of Directors.

 

 


6 months to 30 June 2024

6 months to 30 June 2023

Year ended 31 December

2023


Total

Total

Total


(Unaudited)

(Unaudited)

(Audited)


£'000

£'000

£'000

By division:




Pebble Beach Systems

6,485

5,938

6,804

Group

(5,342)

(6,412)

(5,951)


1,143

(474)

853

 

 

 

 

5.   OPERATING PROFIT

 

The following items have been included in arriving at the operating profit for the business:

 


6 months to 30 June 2024

6 months to 30 June 2023

Year ended 31 December

2023


Total

Total

Total


(Unaudited)

(Unaudited)

(Audited)


£'000

£'000

£'000

Inventory recognised as an expense

451

610

1,359

Director and employee costs

3,675

3,244

7,029

Depreciation of property, plant and equipment

82

122

200

Non-recurring items

37

-

105

Exchange (gains)/losses (credited)/charged to profit and loss

21

35

31

Amortisation of capitalised development costs

711

634

1,305

 

 

 

6.   INCOME TAX EXPENSE

 


6 months to 30 June 2024

6 months to 30 June 2023

Year ended 31 December

2023


Total

Total

Total


(Unaudited)

(Unaudited)

(Audited)


£'000

£'000

£'000

Current tax




UK corporation tax

-

-

-

Foreign Tax - current year

4

6

10

Total current tax

4

6

10


 



Deferred tax

 



UK corporation tax

-

-

-

Total deferred tax

-

-

-

 

 



Total taxation

4

6

10

 

 

7.   EARNINGS PER ORDINARY SHARE

 

Basic earnings per share is calculated by dividing the earnings attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the year.

 

For diluted earnings per share the weighted average number of ordinary shares in issue is adjusted to assume conversion of all dilutive potential ordinary shares. The dilutive shares are those share options granted to employees where the exercise price is less than the average market price of the Company's ordinary shares during the year. The average market value of the Company's shares for the purpose of calculating the dilutive effect of share options was based on quoted market prices for the year during which the options were outstanding.

 

Reconciliations of the earnings and weighted average number of shares used in the calculations are set out below.

 

 


6 months to 30 June 2024 (Unaudited)


 

 

 

 

Earnings

 £'000

 

Weighted

average

number

 of shares

 '000s

 

 

Earnings

 per share

 pence

Basic earnings per share




Profit attributable to ordinary shareholders

290


0.2p

Basic earnings per share

290

124,477

0.2p

Diluted earnings per share




Profit attributable to ordinary shareholders

290


0.2p

Diluted earnings per share

290

125,875

0.2p





 

 

 


6 months to 30 June 2023 (Unaudited)



 

 

 

 

Earnings

 £'000

 

Weighted

average

number

 of shares

 '000s

 

 

Earnings

 per

share

 pence

Basic earnings per share




Profit attributable to ordinary shareholders

242


0.2p

Basic earnings per share

242

124,477

0.2p

Diluted earnings per share




Profit attributable to ordinary shareholders

242


0.2p

Diluted earnings per share

242

125,114

0.2p

 

 


Year ended 31 December 2023 (Audited)


 

 

 

 

Earnings

 £'000

 

Weighted

 average

 number

 of shares

 '000s

 

 

Earnings

 per share

 pence

Basic earnings per share




Profit attributable to ordinary shareholders

1,534


1.2p

Basic earnings per share

1,534

124,477

1.2p

Diluted earnings per share




Profit attributable to ordinary shareholders

1,534


1.2p

Diluted earnings per share

1,534

127,454

1.2p





 

Adjusted earnings

 

The directors believe that adjusted EBITDA, adjusted earnings and adjusted earnings per share provide additional useful information on underlying trends to shareholders. These measures are used by management for internal performance analysis and incentive compensation arrangements. The term "adjusted" is not a defined term used under IFRS and may not therefore be comparable with similarly titled profit measurements reported by other companies. The principal adjustments made are in respect of the amortisation of acquired intangibles, share based payment expense, non-recurring items and exchange gains or losses charged to the income statement and their related tax effects.

 

The reconciliation between reported and underlying earnings and basic earnings per share is shown below:

 

 


6 months to 30 June 2024

6 months to 30 June 2023

Year ended 31 December

2023


Total

Total

Total


(Unaudited)

(Unaudited)

(Audited)


Earnings

Earnings

Earnings


£'000

Pence

£'000

Pence

£'000

Pence

Reported earnings and earnings per share

290

0.2p

242

0.2p

1,534

1.2p

Share based payment expense

-

0.0p

28

0.0p

57

0.1p

Exchange (gains)/losses

16

0.0p

27

0.0p

23

0.0p

Non-recurring items

37

0.1p

-

0.0p

85

0.1p

Adjusted earnings and earnings per share

343

0.3p

297

0.2p

1,699

1.4p

 

 

 

8.   INTANGIBLE ASSETS


Goodwill

 £'000

 Acquired customer relationships

 £'000

 Acquired intellectual property

 £'000

 Capitalised development costs

 £'000

 Total

 £'000

Cost






At 1 January 2023 (audited)

3,218

4,493

3,350

8,745

19,806

Additions (unaudited)

-

-

-

941

941

At 30 June 2023 (unaudited)

3,218

4,493

3,350

9,686

20,747

At 1 January 2023 (audited)

3,218

4,493

3,350

8,745

19,806

Additions (audited)

-

-

-

2,105

2,105

At 1 January 2024 (audited)

3,218

4,493

3,350

10,850

21,911

Additions (unaudited)

-

-

-

1,165

1,165

At 30 June 2024 (unaudited)

3,218

4,493

3,350

12,015

23,076

Accumulated amortisation






At 1 January 2023 (audited)

-

4,493

3,350

5,656

13,499

Charge for the period (unaudited)

-

-

-

633

633

At 30 June 2023 (unaudited)

-

4,493

3,350

6,289

14,132

At 1 January 2023 (audited)

-

4,493

3,350

5,656

13,499

Charge for the year (audited)

-

-

-

1,305

1,305

At 1 January 2024 (audited)

-

4,493

3,350

6,961

14,804

Charge for the period (unaudited)

-

-

-

711

711

At 30 June 2024 (unaudited)

-

4,493

3,350

7,672

15,515

Net book value






At 30 June 2024 (unaudited)

3,218

-

-

4,343

7,561

At 31 December 2023 (audited)

3,218

-

-

3,889

7,107

At 30 June 2023 (unaudited)

3,218

-

-

3,397

6,615

At 1 January 2023 (audited)

3,218

-

-

3,089

6,307

 

The amortisation of development costs is included in research and development expenses in the Consolidated Group Income Statement. Within capitalised development costs there are £5.4 million (6 months to June 2023: £4.0 million) of fully written down assets that are still in use.

 

 

9.   CASH FLOW GENERATED FROM OPERATING ACTIVITIES

 

Reconciliation of profit before taxation to net cash flows from operating activities.

 


6 months to 30 June 2024

6 months to 30 June 2023

Year ended 31 December

2023


Total

Total

Total


(Unaudited)

(Unaudited)

(Audited)


£'000

£'000

£'000

Profit before tax

294

248

1,544

Depreciation of property, plant and equipment

82

122

200

(Profit)/loss on disposal of property, plant and equipment

26

-

-

Amortisation and impairment of development costs

711

634

1,305

Loss on disposal of property, plant and equipment

-

-

20

Non-recurring item

-

-

105

Share based payment expense

-

28

57

Finance costs

255

291

531

Decrease/(increase) in other non-current assets

-

-

26

Decrease/(increase) in inventories

(68)

6

194

Decrease/(increase) in trade and other receivables

889

263

(792)

Increase/(decrease) in trade and other payables

(774)

438

727

Net cash generated from operating activities

1,415

2,030

3,917

 

 

 

10.  NET FUNDS

 

Reconciliation of change in cash and cash equivalents to movement in net debt:

 

 


Net cash and cash equivalents

£'000

Other borrowings

£'000

Total net debt

£'000

At 1 January 2024

796

(5,675)

(4,879)

Cash flow for the period before financing

(46)

-

(46)

Movement in borrowings in the period

(500)

500

-

Principal lease payments

(4)

4

-

Exchange rate adjustments

-

-

-

Cash and cash equivalents at 30 June 2024 (Unaudited)

246

(5,171)

(4,925)

At 1 January 2023

728

(6,485)

(5,757)

Cash flow for the period before financing

720

-

720

Movement in borrowings in the period

(500)

500

-

Exchange rate adjustments

3

-

3

Cash and cash equivalents at 30 June 2023 (Unaudited)

951

(6,050)

(5,099)

At 1 January 2023

728

(6,706)

(5,978)

Cash flow for the year before financing

1,205

-

1,205

Movement in borrowings in the year

(1,000)

1,000

-

Principal lease payments

(96)

96

-

Netting of arrangement fee

-

(65)

(65)

Exchange rate adjustments

(41)

-

(41)

Cash and cash equivalents at 31 December 2023 (Audited)

796

(5,675)

(4,879)

 

 

Ends

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