CROMA SECURITY SOLUTIONS GROUP PLC — Interim / Quarterly Report 2015

Feb 26, 2015

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RNS Number : 9087F

Croma Security Solutions Group PLC

26 February 2015

CROMA SECURITY SOLUTIONS GROUP PLC

(LON:CSSG)

INTERIM RESULTS FOR SIX MONTHS TO 31 DECEMBER 2014

Croma Security Solutions Group plc (the "Group") the AIM listed total security services provider announces its unaudited interim results for the six months to 31 December 2014.

HIGHLIGHTS

·     Revenue up 14% to £8.3M (six months to 31 December 2013: £7.3M)

·     Gross Profit:  £1.96M  (six months to 31 December 2013: £1.82M)

·     EBITDA* £0.42M (six months to 31 December 2013: £0.3M)

·     Diluted EPS up by 92% to 1.44p (six months to 31 December 2013: 0.75p)

·     Net Assets £9.1M  (31 December 2013: £8.7M)

·     Cash £0.68M  (31 December 2013: £0.84M)

·     Maiden dividend declared of 0.3p per share

*Earnings before interest, tax, depreciation, amortisation and acquisition costs

For further information visit www.cssgroupplc.com or contact:

Croma Security Solutions Group PLC

Sebastian Morley, Chairman                   Tel: +44 (0)7768 006 909

WH Ireland Limited

Adrian Hadden / Mark Leonard              Tel: +44 (0)207 220 1666

Chairman's Statement

I am pleased to report the financial results for the six months to 31 December 2014 which demonstrate an increase in turnover and profitability for the Group.

During the period,  turnover increased by 14% to £8.30M.  We are reinforcing our message of quality of service across the Group and we are seeing excellent levels of customer retention as well as targeted new client wins. Profit Before Tax nearly doubled to £270,000 (H1 2013: £144,000) with EBITDA of £0.42M (H1 2013: £0.3M).

Our core activities are Premium ex-military manned guarding, CCTV, intruder systems, fire systems, biometric identification and access control.  The focus of the Group is to deliver sustainable growth, from clients who recognise the value of coordinated high quality security services with the opportunities presented by our market leading technologies, Fastvein and Vehicle Impact Protection System (VIPS).  We have strengthened our sales team, enhanced our on-line presence, and are looking to promote Croma Security to a wider market at home and abroad.

Financial Review

Turnover increased to £8.30M against £7.31M in H1 2013.

The group has seen continued pressure on margins but has held the line and kept Gross Profit broadly steady at 23.8% (H1 2013: 24.8%). Vigilant has been able to hold its margin at historic levels, however Systems and Locksmiths are still experiencing a very competitive marketplace.

Administrative expenses have been steady at £1.69M (H1 2013: £1.67M) and include the costs relating to the final stages of the development of FastVein™.  This system is being rolled out and further costs will be incurred relating to module developments and enhancements.

Debtor days at 31 December were steady at 51 (2013: 50). Credit control remains strong, and bad debt expense has been minimal, however the increase in trading has seen an increase in working capital, with net current assets rising to £2.10M (30 June 2014: £1.84M)

Outlook

The Group is now performing at the level it should be and has identified opportunities to increase its client base of blue chip businesses.  The last few years of development and restructuring have been worthwhile, and put the Group in a position to maintain a steady push for organic growth.

The Directors are looking closely at opportunities to establish a presence overseas and take our integrated solutions, including VIPS and FastVein™, where possible, into new markets.

The Board was pleased to be able to declare an interim dividend in December, and looks forward to be able to declare a final dividend later in the year on the back of continued good trading.

The Group's efforts in creating a stable platform for growth across the spectrum has enabled the Board to look at our future prospects with confidence.

Sebastian Morley

Chairman

25   February 2015

CROMA SECURITY SOLUTIONS GROUP PLC

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR 6 MONTHS ENDED 31 DECEMBER 2014

			6 months ended		6 months ended		Year Ended
			31 December 2014		31 December 2013		30 June 2014
			unaudited		unaudited		audited
		Notes	£		£		£
Revenue		1	8,299,906		7,307,794		14,813,444
Cost of sales			(6,334,021)		(5,492,511)		(11,150,460)
Gross profit			1,965,885		1,815,283		3,662,984
Administrative expenses			(1,692,346)		(1,666,518)		(3,347,618)
Other operating income			10,200		10,200		21,453
Operating profit			283,739		158,965		336,819
	Analysed as:
	Earnings before interest, tax, depreciation,  and amortisation		418,212		304,966		620,863
	Depreciation		(49,525)		(53,565)		(99,172)
	Amortisation		(84,948)		(92,436)		(184,872)
	Operating profit		283,739		158,965		336,819
Finance expense costs			(14,229)		(15,374)		(32,235)
Profit before tax			269,510		143,591		304,584
Tax			(53,902)		(32,308)		15,973
Profit for the year from continuing operations			215,608		111,283		320,557
Profit and total comprehensive profit for the year attributable to owners of the parent			215,608		111,283		320,557
Earnings per share		2
Basic earnings per share (pence)
- Earnings from continuing operations			1.45		0.75		2.16
- (Loss)/earnings from discontinued operations			0.00		0.00		0.00
- Total			1.45		0.75		2.16
Diluted earnings per share (pence)
- Earnings from continuing operations			1.44		0.75		2.16
- (Loss)/earnings from discontinued operations			0.00		0.00		0.00
- Total			1.44		0.75		2.16

CROMA SECURITY SOLUTIONS GROUP PLC

CONSOLIDATED  STATEMENT OF FINANCIAL POSITION AT 31 DECEMBER 2014

	31 December 2014		31 December 2013		30 June 2014
	unaudited		unaudited		audited
Assets	£	£	£	£	£	£
Non-current assets
Goodwill		5,866,961		5,866,961		5,866,961
Other Intangible assets		1,056,342		1,233,726		1,141,290
Property, plant and equipment		400,702		364,936		329,356
		7,324,005		7,465,623		7,337,607
Current assets
Inventories	238,381		211,559		222,958
Trade and other receivables	2,850,751		2,431,326		2,485,885
Cash and cash equivalents	679,185	3,768,317	836,954	3,479,839	899,693	3,608,536
Total assets		11,092,322		10,945,462		10,946,143
Liabilities
Non-current liabilities
Deferred tax	(299,474)		(314,708)		(299,474)
Trade and other payables	(29,025)		(19,822)		(5,263)
Provisions	-	(328,499)	(1,422)	(335,952)	-	(304,737)
Current liabilities
Trade and other payables	(535,098)		(487,658)		(378,172)
Other taxes & Social Security	(747,337)		(934,686)		(777,377)
Accruals and deferred income	(387,109)		(408,499)		(440,504)
Borrowings	-	(1,669,544)	(112,049)	(1,942,892)	(166,682)	(1,762,735)
Total liabilities		(1,998,043)		(2,278,844)		(2,067,472)
Net assets		9,094,279		8,666,618		8,878,671
Issued capital and reserves attributable to owners of the parent
Share capital		743,307		743,307		743,307
Share premium		5,230,276		5,230,276		5,230,276
Merger reserve		2,139,454		2,139,454		2,139,454
Retained earnings		556,141		131,259		340,533
Undistributable Reserves		422,322		422,322		422,322
Other reserves		2,779		-		2,779
Total equity		9,094,279		8,666,618		8,878,671

CROMA SECURITY SOLUTIONS GROUP PLC

CONSOLIDATED STATEMENT OF CASHFLOWS FOR 6 MONTHS ENDED 31 DECEMBER 2014

		6 months ended		6 months ended		Year ended
		31 December 2014		31 December 2013		30 June 2014
		unaudited		unaudited		audited
		£		£		£
Cash flows from operating activities
Profit/(loss) before taxation		269,510		143,591		304,584
Depreciation, and amortisation		134,473		146,001		284,044
(Profit)/loss on sale of plant and equipment		(194)		(2,887)		8,103
Movement on provisions		-		(2,697)		-
Net changes in working capital		(452,696)		324,881		37,286
Financial expenses		14,229		15,374		32,235
Taxes paid				-		-
Net cash generated/(used) from operations		(34,678)		624,263		666,252
Cash flows from Investing activities
Purchase of property, plant and equipment		(71,552)		(39,200)		(49,589)
Proceeds on disposal of property, plant and equipment		12,000		9,500		14,100
Net cash generated/(used) in investing activities		(59,552)		(29,700)		(35,489)
Cash flows from financing activities
Hire purchase payments		(4,294)		-		(23,742)
(Repayments)/advances on invoice discounting facility		(112,049)		(424,100)		(358,107)
Repayment of borrowings						-
Interest paid		(9,935)		(11,368)		(27,079)
Net cash (used) in financing activities		(126,278)		(435,468)		(408,928)
Net (decrease)/increase in cash and cash equivalents		(220,508)		159,096		221,835
Cash and cash equivalents at beginning of period		899,693		677,858		677,858
Cash and cash equivalents at end of the period		679,185		836,954		899,693

NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR 6 MONTHS TO 31 DECEMBER 2014

1.  Basis of preparation

The financial information in the half yearly report has been prepared using the recognition and measurement principles of International Accounting Standards, International Financial Reporting Standards and Interpretations adopted for use in the European Union ("IFRS").

The principal accounting policies in this half yearly report are unchanged from those applied in the 2014 financial statements. The financial information for the six months ended 31 December 2014 and the six months ended 31 December 2013 are unaudited and have not been reviewed by the Group's auditor.

The financial statements for the year ended 30 June 2014, which were prepared in accordance with IFRS, and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS, have been delivered to the Registrar of Companies. The auditors' report on these accounts was unqualified and did not contain a statement under sections 498(2) and 498(3) of the Companies Act 2003.

While the financial information in this half yearly report is consistent with the recognition and measurement principles of adopted IFRS, it does not comply with the requirements of IAS34 Interim Financial Reporting nor does it constitute statutory accounts within the meaning of the Companies Act 2006.

2.  Earnings per share

Earnings per share is based upon the profit for the period and the weighted average number of shares in issue and ranking for dividend

The following reflects the profit and share data used in the basic and diluted EPS computations:

	6 months ended		6 months ended		Year ended
	31 December 2014		31 December 2013		30 June 2014
	unaudited		unaudited		Audited
	£		£		£
Numerator
Profit/(loss) for the year on continuing operations and  used in basic EPS	215,608		111,283		320,957
Profit/(loss) used in diluted EPS on continuing operations	215,608		111,283		320,957
Profit for the period on discontinued operations and used in basic and diluted EPS	-		-		-
Denominator
Weighted average number of shares used in basic EPS	14,866,138		14,866,138		14,866,138
Effects of:
-   Company Share Option Scheme	64,000		-		5,962
Weighted average number of shares used in diluted EPS	14,930,138		14,866,138		14,872,100

3.  Taxation

Taxation has been provided for at 22.0%

4.  Dividends

The Board approved an interim dividend for the year of 0.3 pence per share (2013: Nil).

This dividend was paid after the date of these statements, on 8 January 2015.

5.  Financial Information

The Board of Directors approved this interim report on 25 February 2015.

A copy of this report can be obtained by writing to the Company Secretary at our registered office; Unit 6 Fulcrum 4, Solent Way, Whiteley, Hampshire PO15 7FT or from our website at www.cssgroupplc.com

This information is provided by RNS

The company news service from the London Stock Exchange

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