RNS Number:0765F
CML Microsystems PLC
12 June 2001
For Immediate Release
12 June 2001
CML MICROSYSTEMS PLC
2001 FINAL RESULTS
Record Results Above Market Expectations; PTP up 150% to #5.32m; Basic EPS up
146%
CML Microsystems Plc ("CML"), which designs, manufactures and markets a broad
range of semiconductor products, primarily for the global communications
industry, announces its Final Results for the trading year ending 31 March
2001.
CML's semiconductor circuits and devices serve customers in electronic
manufacture, assembly and distribution in the wire-line telecom, wireless data
and private mobile radio/land mobile radio markets. CML is listed on the
London Stock Exchange and is traded OTC as an ADR in the US. Operating
subsidiaries are in the UK, the US and Singapore.
Commenting on the results, George Gurry, Chairman said:
"Both halves produced firm improvements on the previous year and the results
for 2001 come out showing an increase much in line with your Board's
expectations."
Financial Highlights
* Sales: #21.72m, up 10% - but up 22% on a like-for-like " continuing
business" basis
* Sales by region: UK & Europe 36%, Japan/Far East 36%,
America and other 28%
* Pre-tax profits: #5.32m (2000: #2.13m), up 150%
* Fully diluted earnings per share of 25.86p (2000: 0.71p), up 141%
* 9% of net revenues spent on R&D
* Net cash reserves of #10.9m (2000: #6.85m)
* NAV per share: 143p
* Dividend of 10.5p (2000: 8.5p), up 23.5%, payable 3 August 2001
Business Review
* Every semiconductor operating company increased their sales
* Improved market penetration
* Customers include: Alcatel, Bang & Olufsen, Kenwood, Motorola, NEC,
Novatel, Panasonic, Racal, Samsung, Siemens and Sony.
* Portfolio of over 150 products of mixed signal, low power semiconductor
chips for hand wired and wireless applications
* Unique niche market position to take advantage of
growing demand for application specific semiconductor devices
* Rolling programme for new product development
Regarding prospects, George Gurry, Chairman said:
"I share the awareness of your Board, and of the management of its operating
companies, that the conditions generally forecast for some group market areas
are not presently conducive to growth. I do not doubt that challenge is and
will be experienced.
I am optimistic, however, that your Company will achieve its forecast of a
firm improvement to its results for the current year."
enquiries:
CLMicrosystems Plc
Nigel Clark, Financial Director
Chris Gurry, Business Development Director
Tel: 020 7786 9600
Binns & Co PR
Peter Binns/Simon Ellis/Paul McManus
Tel: 020 7786 9600
CML MICROSYSTEMS PLC
PRELIMINARY RESULTS
Chairman's Statement
I am pleased to report on a year that has seen your Company post a quite
satisfying increase to its final results. Following from the firm improvement
that I had reported at the half-way stage, a similarly positive outcome was
achieved for the closing six month period, and the results for the full
trading year ending 31 March 2001 come out showing an increase much in line
with your Board's expectations.
Group turnover grew to #21.72m, a 10% rise on the previous full year (2000: #
19.75m), but a 22% gain when compared on a like for like "continuing
businesses" basis (2000: #17.76m). The accounts (note 27) provide further
comparative figures, which draw on the disposal of the group's traffic
interests in the prior year.
Group operating profit shows an increase to #4.75m, approximately 150% up on
the posted prior result (2000: #1.9m), but an increase of 51% when measured on
the continuing businesses basis (2000: #3.15m). The net income from interest
earnings rose two-fold over the figure for the year earlier.
Pre-tax profit grew to #5.324m, again showing a 150% rise on the prior year
(2000: #2.135m), but perhaps more appropriately stated as a 57% increase on
the continuing businesses basis (2000: #3.398m). The group's operations, which
are now conducted principally in the area of semiconductor products, are
delivering approximately 24% of turnover to the pre-tax profit level.
A reduced level of Corporation Tax for the UK companies resulted from the R&D
Tax Credit legislation introduced for the year. This has largely contributed
to the reduced tax charge, but this benefit will not necessarily be available
in any subsequent years. The group's effective tax rate for the year is
reduced to 29%.
Fully diluted earnings per ordinary share rose by 141% to 25.86p per share
(2000: 10.71p). The Company made no market purchase of its shares during the
year, and the number of shares in issue grew only slightly as the result of
options exercised under the Employee Share Option schemes.
After increased expenditure on R&D, up by #400k to slightly over #2m, and
representing approximately 9% of turnover, the Group's net cash reserves
amounted to #10.9m at the year end (2000: #6.85m). This equates to 74.6p per
share.
Your Directors believe that these results represent a year of confident
progress by your Company, and they are recommending the payment of a dividend
of 10.5p per ordinary share, an increase of 23.5% over that paid for the year
earlier (2000: 8.5p per ordinary share). This dividend, if approved, will be
payable on 3 August 2001 to all shareholders registered as at 6 July 2001.
Each of the group's semiconductor operating companies closed the year having
posted firmly increased sales, led principally by their improving penetration
of the markets for the group's growing range of devices serving the Wire-line
Telecom, Wireless Data and Private Mobile Radio market areas.
Taken on a territorial basis, the healthiest gains were evident through sales
to customers located in the Far East and the Americas, while a useful
improvement was also seen in the figures recorded for Europe. Sales into the
UK, as reported in these accounts, show a comparative that is inclusive of the
discontinued business.
As I noted with my interim statement, the eventual territory for which sales
are recorded may be different from the point where the effective sale was
secured. This is a feature common to the markets that the group currently
addresses, and which the extensive distribution and technical support presence
provided through its operating companies serves well.
The group maintains a rolling programme for new product development, and the
level of investment increased in the year as I have mentioned. The group's
products are already achieving best-solution status in key opportunity areas
of its markets, and recent and current new-product programme focus will
reinforce and expand the group's positioning for continued growth.
Wireless Data, in the forms that support Telemetry, Telematics and mobile
information and e-mail services, is a growing application supported by various
narrow-band spectrum owners operating in many countries. Of the four principle
data-only technologies employed worldwide, the group has had product deployed
in three. It launched both second-generation and an advanced fourth-system
part during the year, and will shortly introduce a further high-integration
new product.
Wire-line communications has many facets. The group is active in several of
these, particularly where very low power requirements are the application
pre-requisite. The group's products enjoy success in this area, and this is
exploited through the group's perceptive approach to new opportunities. Design
activities initiated during the year will result in substantial product
launches during the second half of this present year.
Private Mobile Radio is a term associated with professional two-way radio
communication, but is increasingly used to distinguish private and personal
radio uses from the public mobile subscription networks. The group is very
active in both the professional and leisure areas of "private mobile radio",
and is adaptive to the changes taking place within each. The trend from
analogue towards digital for professional users is recognised through group
digital solutions, and the slow pace is being addressed through dual-mode
devices due for release in this opening half.
I share the awareness of your Board, and of the management of its operating
companies, that the conditions generally forecast for some group market areas
are not presently conducive to growth. I do not doubt that challenge is and
will be experienced.
I am optimistic, however, that your Company will achieve its forecast of a
firm improvement to its results for the current year.
In closing, I would like to acknowledge the vital contribution that the
group's employees make towards your Company's success, and to extend my thanks
and appreciation for their loyal support and continuing dedicated effort on
its behalf.
W Gurry
Chairman
12th June 2001
PRELIMINARY RESULTS
GROUP PROFIT AND LOSS ACCOUNT
for the year ended 31st March 2001
Unaudited Audited
2001 2000
#'000 #'000
Turnover 21,719 19,751
Operating Profit 4,758 2,462
Exceptional item - (556)
Profit on Ordinary Activities before Interest and Taxation 4,758 1,906
Interest Receivable 566 247
Interest Payable - (18)
Profit on Ordinary Activities before Taxation 5,324 2,135
Taxation (1,523) (617)
Profit on Ordinary Activities after Taxation 3,801 1,518
Minority Interest 13 (14)
Profit for the financial year 3,814 1,504
Proposed dividend (1,534) (1,217)
Retained profit for year 2,280 287
Earnings Per Share
Basic 26.38p 10.73p
Diluted 25.86p 10.71p
Statement of Total Recognised Gains and Losses
Profit for the financial year 3,814 1,504
Currency translation differences on foreign currency net 716 62
investments
Total gains recognised since last Report and Accounts 4,530 1,566
PRELIMINARY RESULTS
GROUP BALANCE SHEET
at 31st March 2001
Unaudited Audited
2001 2000
#'000 #'000
Fixed Assets
Tangible Assets 9,858 9,817
Current Assets
Stocks 2,037 1,681
Debtors 2,900 3,014
Investments 8,733 3,893
Cash at bank and in hand 2,173 2,958
15,843 11,546
Creditors:
Amounts falling due within one year 4,778 3,856
Net Current Assets 11,065 7,690
Total Assets Less Current Liabilities 20,293 17,507
Provisions for liabilities and charges - 6
Net Assets 20,923 17,501
Capital and Reserves
Called up Share Capital 730 716
Share Premium Account 3,226 2,802
Capital Redemption Reserve 255 255
Profit and Loss Account 16,701 13,704
Shareholders' Funds 20,912 17,477
Minority Interests 11 24
20,923 17,501
PRELIMINARY RESULTS
GROUP CASH FLOW STATEMENT
for the year ended 31st March 2001
Unaudited Audited
2001 2000
#'000 #'000
Net cash in flow from operating activities 5,759 3,783
Returns on investments and servicing of finance 566 229
Taxation (835) (564)
Capital expenditure and financial investment (1,091) (574)
Equity dividends paid (1,217) (974)
Net cash in flow before financing 3,182 1,900
Financing 439 473
Increase in cash 3,621 2,373
Notes
1. The profit and loss account, balance sheet and cash flow statement are an
abridged version of the Company's full accounts which have not yet been filed
with the Registrar of Companies and which have not yet been reported on by the
Company's auditors.
2. A dividend of 10.5p per Ordinary Share (2000: 8.5p per Ordinary Share) is
recommended in respect of the year ended 31st March 2001 and will be paid on
3rd August 2001 to shareholders on the register as at 6th July 2001.
3. The calculation of earnings per share is based on the earnings attributable
to ordinary shareholders divided by the weighted average number of shares in
issue during the year.
The calculation of diluted earnings per share is based on the basic earnings
per share adjusted to allow for the issue of shares on the assumed conversion
of all dilutive options.
4. The same accounting policies have been used for the year ended 31st March
2001 as for the year ended 31st March 2000.
5. The preliminary announcement was approved by the Board of Directors on 11th
June 2001.
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