TIDMCUS
RNS Number : 8005E
CustomVis plc
30 December 2009
30 December 2009
CUSTOMVIS PLC
("CustomVis" or "the Group")
FINAL RESULTS
For the year ended 30 June 2009
CustomVis (AIM: CUS) develops, manufactures and sells laser systems for
refractive surgery of the eye. To date, sales are in many countries worldwide,
excluding the US. The Directors believe it is currently the only company in the
world marketing a solid state laser to perform this surgery. Solid state is
widely accepted as the next generation technology for this industry as it
overcomes known shortcomings of the gas excimer lasers currently used for this
purpose.
PERIOD HIGHLIGHTS
* Revenue increased by 82% to GBP2.12m (2008: GBP1.16m)
* Gross profit increased by 70% to GBP1.07m (2008: GBP0.63m)
* Loss before tax (before unrealised gain on foreign exchange) reduced by almost
40% to GBP1.1m (2008: GBP1.82m)
* 14 lasers sold bringing the installed laser base to 40 (2008: 28) in 19
countries
* Over 110,000 eyes now operated on
POST PERIOD HIGHLIGHTS
* 5 more lasers sold since 30 June 2009, taking the total installed base to 45
* RetinaVis launched - sales expected to commence in 2010
* PresBvis - presbyopia approval granted 6 November 2009 and first per patient fee
collected
* Laser installed at Moorfields Eye Hospital and trial commenced
* Fundraising of GBP300,000 in October 2009 to provide working capital
Dr. Paul van Saarloos, CEO of CustomVis, commented:
"Solid State and the Pulzar laser are becoming accepted as alternatives to
excimer lasers, as is evidenced by a record level of sales leads. PresBvis is
the first ablative laser to receive European CE approval for the treatment of
Presbyopia. Per use fees have already been collected for this treatment, which
is likely to grow into a useful revenue stream. We have also seen an increase in
interest in the Pulzar laser in Europe due to this approval. During 2010 we also
expect our revenue to be nicely complimented by RetinaVis sales. Since
redesigning the unit for improved ease of use, we have been negotiating
significant numbers of orders. Although the past 12 months have been an
extremely difficult period, we believe that much better times are not far away."
For further information, please contact:
+---------------------------------------+---------------------------------------+
| CustomVis plc | |
+---------------------------------------+---------------------------------------+
| Simon Carroll, Chairman | +61 419 304 906 |
| Paul van Saarloos, CEO | +61 410 497 456 |
+---------------------------------------+---------------------------------------+
| | |
+---------------------------------------+---------------------------------------+
| Merchant John East Securities Limited |
+-------------------------------------------------------------------------------+
| David Worlidge | 020 7628 2200 |
+---------------------------------------+---------------------------------------+
| | |
+---------------------------------------+---------------------------------------+
| Leander PR | |
+---------------------------------------+---------------------------------------+
| Christian Taylor-Wilkinson | 07795 168 157 |
+---------------------------------------+---------------------------------------+
CHAIRMAN'S REPORT
Introduction
I am pleased to report the continued corporate development of CustomVis plc and
the installed base of our flagship laser product, the Pulzar Z1, of 40 at the
end of June 2009, increasing to 45 at the date of this report. This figure comes
despite difficult economic conditions and time-consuming distractions caused by
the unsuccessful attempt of certain shareholders to remove certain members of
the Board that resulted in the EGM on 6 July 2009 and the continued negative
influences exerted by certain parties and competitors. The Group now has lasers
operating in 21 countries, with recent new territories including, Peru,
Argentina, Saudi Arabia, Spain, France and the UK.
The Pulzar Z1 is, we believe, the world's only solid-state laser being sold for
refractive surgery. Its unique properties, including a wavelength of 213nm which
reduces tissue damage and promotes a faster recovery time than the traditional
excimer gas lasers, means that interest within the refractive industry continues
to grow. Lasers sold by the Group have now operated on over 110,000 eyes.
Excellent headway has been made with our new products and procedures: RetinaVis,
our highly portable digital ophthalmoscope has been presented to a range of
customers and distributors and should begin to see sales in 2010; PresBvis, a
unique treatment for presbyopia received both Australian TGA and European CE
regulatory approval in November 2009 and the necessary software upgrades on
current installed lasers to facilitate the expeditious roll-out of the treatment
are underway. CustomVis is, we believe, the first refractive laser company to
receive that approval for this type of procedure and expands the options for
treatment of this extensive age-related vision impairment.
During the reporting period, we relocated our Australian production facility,
enabling ongoing operational expense reductions while maintaining planned
production capacity. The Company was also granted an extension of the
Therapeutic Goods Administration (TGA) regulatory approval for the production
and sale of the Pulzar laser for a further 5 years.
Financial Review
Revenue from sales increased a substantial 82 per cent to GBP2,119,384 (2008:
GBP1,161,312). Gross profit was GBP1,071,519 (2008: GBP628,742), an increase of
70 per cent. The Group made a loss before taxation for the year of GBP383,102
after recognising an unrealised gain on foreign exchange of GBP717,729 (2008:
profit of GBP658,702, after recognising an unrealised gain on foreign exchange
of GBP2,481,397). Loss per share for the year ended 30 June 2009 was 0.22p
(2008: Earnings per share 0.56p).
The net cash outflow from operating activities during the year ended 30 June
2009 reduced to GBP1,306,075 compared to GBP1,887,185 in the corresponding
2007/08 year and, at 30 June 2009, the Group had cash in hand of GBP0.3 million.
A placing of approximately GBP300,000 was completed on 5 October 2009, with the
issue of 23,030,000 new shares at 1.3p per share.
The Directors continue to implement developments through a range of activities,
including:
* Transition towards more front-ended or cash sales away from the longer term
payment plans;
* Enhancements to the Pulzar to drive increased sales growth;
* Focus on Europe where higher sales margins are generally achievable;
* Initiation of two new revenue streams with upfront payments for PresBvis
treatments and sales of the digital ophthalmoscope RetinaVis; and
* Improved receivables management with installed electronic keys.
By doing so the Directors are confident that they will be able to fund ongoing
operations and growth by these and other options the Board is currently
pursuing. One option may be to raise additional working capital at some stage in
2010.
Sales and Marketing
In the past, CustomVis has predominately sold lasers directly to its customers
and managed all related service and warranty programmes. This strategy was
required initially, as distributors did not have the knowledge and skills to
introduce this new technology to their markets.
The Company has now appointed a Marketing Manager located in Perth and we have
Territory Managers for Latin America, the Middle East and the Asia Pacific
Regions. The advantages of this strategy of conducting sales and service through
a distributor network expands the sales profile; distributors have good local
knowledge with their sales personnel being in regular contact with the surgeons
in their region and distributors generally attend the national ophthalmic
conferences. Further, all front line service is actioned through our
distributors.
During the year, our team attended many of the world's most prestigious
ophthalmic conferences and exhibitions in Europe, the United States of America
and the Middle East. While our sales numbers have been below those anticipated,
the number of inquiries and quality of the interest in the Pulzar Z1 laser has
been increasing substantially over recent months.
Our installation of a Pulzar Z1 at the world renowned Moorfields Eye Hospital in
London has allowed the initiation of a trial for vision correction by refractive
surgery of some quite difficult cases. Given that refractive surgeons are
typically very conservative in their approach to new technologies, this trial
should give a strong indication of further acceptance of our product in the
industry. In addition, good clinical evidence has been gained in a number of
comparative studies, including one from Professor Ioannis Pallikaris, the world
leading ophthalmologist who performed the first LASIK procedure 20 years ago.
World Economic Crisis
The extent of the world economic crisis, particularly in Asia and Europe has
surprised many and certainly impacted on the speed of recovery for the
refractive laser market. Most of our sales are quoted in US dollars, which
coupled with the economic uncertainty has delayed some sales. On the other hand,
the resurgent Australian dollar, compared to the US dollar, has reduced our
capacity to take advantage from the exchange differences.
Importantly, our solid state laser provides a real economic advantage to the
purchaser compared to excimer lasers. The direct and indirect running costs are
lower for solid state lasers. We have noticed that this has become an important
factor for surgeons.
Production
During the year, we relocated our production facility within Perth, allowing us
to consolidate our processes and reset our occupancy costs. The overall
production cost per laser has remained the same as last year; this is despite a
20 per cent. reduction by the research and development team replacing some OEM
parts. To preserve cash during the global economic crisis many parts were
ordered in lower quantities. This has increased the cost of these parts
significantly, balancing out the savings made internally. We also reduced our
inventory holding levels during this year, further protecting our cashflow.
Improved production processes have also resulted in lower technical risks and
decreased production run-time.
RetinaVis(TM)
CustomVis has developed a new low cost portable digital ophthalmoscope
(RetinaVis) for photographing the retina of the eye. The camera has been
demonstrated at three major ophthalmic trade shows receiving a high level of
interest. Feedback from these and other demonstrations has been incorporated
into the design of the device and a test production run completed. Advanced
negotiations for high volume sales are underway with potential distributors to
specific territory and market segments.
The camera has applications in recording images useful for the diagnosis of
glaucoma and diabetic retinopathy. The portability also allows screening and
storage of retinal images from patients who are difficult to access using
existing camera systems, such as those patients who are bed ridden.
The Company believes the camera does not have a close competitive product in
either cost or portability. Interest has been shown from ophthalmology,
optometry and veterinary areas. Our research reveals there is a large market for
these devices and we believe this camera will generate meaningful revenues at
reasonable gross margins in the future, commencing from the third quarter of
2010.
PresBvis(TM)
In November 2009 the Company announced it had been granted approval for its
presbyopia treatment (PresBvis) by the Therapeutic Goods Administration (TGA),
Australia's regulatory agency for medical drugs and devices.
The Company has also been granted European CE approval, allowing the procedure
to be carried out within the European Union.
Presbyopia is an age-associated progressive loss of the focusing power of the
eye's lens, making it difficult to see objects close-up. Most people over the
age of 40 will suffer from it to some degree and current treatment options are
limited.
The Group's installed base of Pulzar Z1 lasers will be capable of conducting the
PresBvis presbyopia treatment through this regulatory approval. The Group has
been conducting simple software upgrades over the last few months, thereby
allowing surgeons operating the Pulzar Z1 lasers to begin offering this
treatment to their patients.
PresBvis users will be charged on a per-patient basis, bringing a new cash flow
stream into the business, with fees paid in advance to CustomVis for each
treatment performed.
Medical Advisory Board
Our recently established Medical Advisory Board meets in conjunction with major
ophthalmic conferences and advises on key technological and medical issues
relevant to the Company's position in the industry. Professor Emanuel Rosen
chairs this Advisory Board of international key opinion leaders. The Company is
grateful for their efforts and insights regarding product line extensions and
technological advances of the Pulzar Z1.
Research and Development
Research and development is an essential undertaking of our Group. It continues
to be a major application of our funds through the wholly-owned subsidiary, CLVR
Limited. This year the Group received Australian Government grants of
GBP320,000 (AusIndustry and Export Development Grant funding) to support certain
specified activities.
The development of our Multifunction Laser has made good progress during the
year and at the time of reporting, prototypes of this product are under
construction. This ophthalmic laser system will be a more advanced version of
our current Pulzar Z1 laser for refractive surgery and will be able to perform
other laser procedures ophthalmologists routinely carry out.
Further, the Group finalised its electronic key system which is now installed on
all new lasers. This system of software control will enable the Group to manage
its payment programmes better when term payments are agreed with customers.
Research work related to the Pulzar Z1 has ensured the successful publication of
a number of important studies proving the safety and efficacy of this laser.
These publications are extremely important tools for breaking the barriers to
accepting this new technology and helping to generate sales:
Recent Peer-Reviewed Scientific and Clinical Publications:
* A Comparison of Corneal Cellular Responses After 213-nm Compared With 193-nm
Laser PhotorefractiveKeratectomy in Rabbits. T Sanders et al, Cornea 28(4), May
2009, pp 434-440
* Simultaneous Topography-guided PRK Followed by Corneal Collagen Cross-linking
for Keratoconus. G. Kymionis et al, J Refract Surg, 25, September 2009, pp
S807-S811
* Clinical Outcomes of LASIK Using a 213 nm Solid-State Laser System: 6-month
Follow-up. Tae Hyung Lim et al, J Korean Ophthalmol Soc, 2009, 50(6), pp
826-830
Intellectual Property: The following issued patents are owned or controlled by
the Company
+-------------------------------------------+---------------------+-------------+
| Title | Country | Patent |
| | | Number |
+-------------------------------------------+---------------------+-------------+
| Limbal-based eye tracking | United Kingdom | GB2426816 |
+-------------------------------------------+---------------------+-------------+
| Laser scanning apparatus and method | United States of | 6575963 |
| | America | |
+-------------------------------------------+---------------------+-------------+
| Surgical visual feedback and eye fixation | United States of | 7001018 |
| method and apparatus | America | |
+-------------------------------------------+---------------------+-------------+
| Surgical visual feedback and eye fixation | Australia | 753444 |
| method and apparatus | | |
+-------------------------------------------+---------------------+-------------+
| Improved apparatus and procedure for | Australia | 780488 |
| ultraviolet laser ablation | | |
+-------------------------------------------+---------------------+-------------+
| Improved apparatus and procedure for | United States of | 7364575 |
| ultraviolet laser ablation | America | |
+-------------------------------------------+---------------------+-------------+
| Crystal mounting in solid state laser | United States of | 7136403 |
| systems | America | |
+-------------------------------------------+---------------------+-------------+
| Crystal mounting in solid state laser | Australia | 2002213639 |
| systems | | |
+-------------------------------------------+---------------------+-------------+
| Masking agent | United States of | 6843788 |
| | America | |
+-------------------------------------------+---------------------+-------------+
| Masking agent | Australia | 783642 |
+-------------------------------------------+---------------------+-------------+
| Optical beam delivery configuration | United States of | 7173745 |
| | America | |
+-------------------------------------------+---------------------+-------------+
| Solid state UV laser | United States of | 7460569 |
| | America | |
+-------------------------------------------+---------------------+-------------+
| Solid state UV laser | Australia | 2003229118 |
+-------------------------------------------+---------------------+-------------+
| Scanning device and method of scanning an | United States of | 7221494 |
| optical beam over a surface | America | |
+-------------------------------------------+---------------------+-------------+
| Scanning device and method of scanning an | Australia | 2003240315 |
| optical beam over a surface | | |
+-------------------------------------------+---------------------+-------------+
| A corneal topographer | Australia | 2003283058 |
+-------------------------------------------+---------------------+-------------+
Outlook
With 45 lasers now installed, over 110,000 eyes treated, an increasing number of
papers being published on our technology and recent improvements to the
performance of the laser, the Directors remain confident about the future of the
Group, while recognising the continued uncertainty of the world economic
circumstances. We do, however, anticipate moving our terms of trade to be more
front-ended and with increased installations of the Pulzar, together with new
revenue streams from PresBvis and RetinaVis to provide the Company with a
stronger financial position going forward.
Management and staff are to be congratulated on their continued attention to
pressing forward through these difficult times and staying focused on delivering
a quality product, the Pulzar Z1, to the international ophthalmology industry.
Simon Carroll
Chairman
CONSOLIDATED INCOME STATEMENT FOR THE YEAR ENDED 30 JUNE 2009
+-------------------------------------------+-------+--------------+--------------+
| | | 2009 | 2008 |
+-------------------------------------------+-------+--------------+--------------+
| |Notes | GBP | GBP |
+-------------------------------------------+-------+--------------+--------------+
| | | | |
+-------------------------------------------+-------+--------------+--------------+
| Revenue | | 2,119,384 | 1,161,312 |
+-------------------------------------------+-------+--------------+--------------+
| Cost of Sales | | (1,047,865) | (532,570) |
+-------------------------------------------+-------+--------------+--------------+
| Gross profit | | 1,071,519 | 628,742 |
+-------------------------------------------+-------+--------------+--------------+
| | | | |
+-------------------------------------------+-------+--------------+--------------+
| | | 592,054 | 436,378 |
| Other income | | | |
+-------------------------------------------+-------+--------------+--------------+
| Staff expenses | | (1,296,713) | (1,087,767) |
+-------------------------------------------+-------+--------------+--------------+
| Marketing expenses | | (238,739) | (135,211) |
+-------------------------------------------+-------+--------------+--------------+
| Depreciation | | (103,231) | (115,420) |
+-------------------------------------------+-------+--------------+--------------+
| Occupancy expenses | | (226,491) | (197,527) |
+-------------------------------------------+-------+--------------+--------------+
| Share based payments | | (26,769) | (9,743) |
+-------------------------------------------+-------+--------------+--------------+
| Administrative expenses | | (1,225,935) | (944,553) |
+-------------------------------------------+-------+--------------+--------------+
| Foreign exchange gain | 2 | 717,729 | 2,481,397 |
+-------------------------------------------+-------+--------------+--------------+
| (Loss) / Profit before tax | 3 | (736,576) | 1,056,296 |
+-------------------------------------------+-------+--------------+--------------+
| Income tax benefit/(expense) | 4 | 353,474 | (397,594) |
+-------------------------------------------+-------+--------------+--------------+
| Operating (loss) / profit for the year | 3 | (383,102) | 658,702 |
| attributable to the equity holders of the | | | |
| parent | | | |
+-------------------------------------------+-------+--------------+--------------+
| | | | |
+-------------------------------------------+-------+--------------+--------------+
| (Loss) / Earnings per share | | | |
+-------------------------------------------+-------+--------------+--------------+
| Basic | 5 | (0.22)p | 0.56p |
+-------------------------------------------+-------+--------------+--------------+
| Diluted | 5 | (0.22)p | 0.56p |
+-------------------------------------------+-------+--------------+--------------+
CONSOLIDATED BALANCE SHEET AS AT 30 JUNE 2009
+-------------------------------------+---------+----------------+-----------------+
| | Notes | 2009 | 2008 |
+-------------------------------------+---------+----------------+-----------------+
| | | GBP | GBP |
+-------------------------------------+---------+----------------+-----------------+
| Assets | | | |
+-------------------------------------+---------+----------------+-----------------+
| Current Assets | | | |
+-------------------------------------+---------+----------------+-----------------+
| Cash and cash equivalents | | 324,797 | 1,493,249 |
+-------------------------------------+---------+----------------+-----------------+
| Trade and other receivables | | 1,602,331 | 800,057 |
+-------------------------------------+---------+----------------+-----------------+
| Prepayments | | 64,967 | 79,286 |
+-------------------------------------+---------+----------------+-----------------+
| Inventory | | 1,199,060 | 1,509,972 |
+-------------------------------------+---------+----------------+-----------------+
| | | | |
+-------------------------------------+---------+----------------+-----------------+
| Total Current Assets | | 3,191,155 | 3,882,564 |
+-------------------------------------+---------+----------------+-----------------+
| | | | |
+-------------------------------------+---------+----------------+-----------------+
| Non-Current Assets | | | |
+-------------------------------------+---------+----------------+-----------------+
| Trade and other receivables | | 838,100 | 664,213 |
+-------------------------------------+---------+----------------+-----------------+
| Property, plant and equipment | 6 | 43,530 | 145,274 |
+-------------------------------------+---------+----------------+-----------------+
| Investments | | - | - |
+-------------------------------------+---------+----------------+-----------------+
| | | | |
+-------------------------------------+---------+----------------+-----------------+
| Total Non-Current Assets | | 881,630 | 809,487 |
+-------------------------------------+---------+----------------+-----------------+
| | | | |
+-------------------------------------+---------+----------------+-----------------+
| TOTAL ASSETS | | 4,072,785 | 4,692,051 |
+-------------------------------------+---------+----------------+-----------------+
| | | | |
+-------------------------------------+---------+----------------+-----------------+
| Current Liabilities | | | |
+-------------------------------------+---------+----------------+-----------------+
| Trade creditors | 7 | (1,007,788) | (749,464) |
+-------------------------------------+---------+----------------+-----------------+
| Current income tax liabilities | 4 | (28,620) | (397,594) |
+-------------------------------------+---------+----------------+-----------------+
| | | | |
+-------------------------------------+---------+----------------+-----------------+
| Total Current Liabilities | | (1,036,408) | (1,147,058) |
+-------------------------------------+---------+----------------+-----------------+
| | | | |
+-------------------------------------+---------+----------------+-----------------+
| Non-Current Liabilities | | | |
+-------------------------------------+---------+----------------+-----------------+
| Payables due after one year | 7 | (302,276) | (189,100) |
+-------------------------------------+---------+----------------+-----------------+
| | | | |
+-------------------------------------+---------+----------------+-----------------+
| Total Non-Current Liabilities | | (302,276) | (189,100) |
+-------------------------------------+---------+----------------+-----------------+
| | | | |
+-------------------------------------+---------+----------------+-----------------+
| TOTAL LIABILITIES | | (1,338,684) | (1,336,158) |
+-------------------------------------+---------+----------------+-----------------+
| | | | |
+-------------------------------------+---------+----------------+-----------------+
| NET ASSETS | | 2,734,101 | 3,355,893 |
+-------------------------------------+---------+----------------+-----------------+
| | | | |
+-------------------------------------+---------+----------------+-----------------+
| EQUITY | | | |
+-------------------------------------+---------+----------------+-----------------+
| Issued Capital | | 5,504,424 | 5,504,424 |
+-------------------------------------+---------+----------------+-----------------+
| Reserves | | 10,166,606 | 10,405,296 |
+-------------------------------------+---------+----------------+-----------------+
| Retained earnings | | (12,936,929) | (12,553,827) |
+-------------------------------------+---------+----------------+-----------------+
| TOTAL EQUITY ATTRIBUTABLE TO THE | | 2,734,101 | 3,355,893 |
| EQUITY HOLDERS OF THE PARENT | | | |
+-------------------------------------+---------+----------------+-----------------+
STATEMENT OF CHANGES IN EQUITY FOR YEAR ENDED 30 JUNE 2009
+----------------------+-----------+------------+----------+-------------+--------------+
| |
+----------------------+
| | Share | Share | Options | Foreign | Retained |
| | Capital | premium | Reserve | currency | earnings |
| | | | |translation | |
| | | | | reserve | |
+----------------------+-----------+------------+----------+-------------+--------------+
| | GBP | GBP | GBP | GBP | GBP |
+----------------------+-----------+------------+----------+-------------+--------------+
| Balance at 1 July | 4,765,957 | 10,301,015 | 417,015 | 127,189 | (13,212,529) |
| 2007 | | | | | |
+----------------------+-----------+------------+----------+-------------+--------------+
| Exchange differences | - | - | - | (1,951,552) | - |
| arising on | | | | | |
| translation of | | | | | |
| foreign operations | | | | | |
+----------------------+-----------+------------+----------+-------------+--------------+
| Net income | - | - | - | (1,951,552) | - |
| recognised directly | | | | | |
| in equity | | | | | |
+----------------------+-----------+------------+----------+-------------+--------------+
| Proceeds from new | 738,467 | 1,661,551 | - | - | - |
| share issue | | | | | |
+----------------------+-----------+------------+----------+-------------+--------------+
| Costs arising from | - | (159,665) | - | - | - |
| share issue | | | | | |
+----------------------+-----------+------------+----------+-------------+--------------+
| Net profit for the | - | - | - | - | 658,702 |
| year | | | | | |
+----------------------+-----------+------------+----------+-------------+--------------+
| Total recognised | 738,467 | | - | (1,951,552) | 658,702 |
| income and expenses | | 1,501,886 | | | |
+----------------------+-----------+------------+----------+-------------+--------------+
| Recognition of share | - | - | 9,743 | - | - |
| based payments | | | | | |
+----------------------+-----------+------------+----------+-------------+--------------+
| Balance at 30 June | 5,504,424 | 11,802,901 | 426,758 | (1,824,363) | (12,553,827) |
| 2008 | | | | | |
+----------------------+-----------+------------+----------+-------------+--------------+
| Exchange differences | - | - | - | (265,459) | - |
| arising on | | | | | |
| translation of | | | | | |
| foreign operations | | | | | |
+----------------------+-----------+------------+----------+-------------+--------------+
| Net income | - | - | - | (265,459) | - |
| recognised directly | | | | | |
| in equity | | | | | |
+----------------------+-----------+------------+----------+-------------+--------------+
| Proceeds from new | - | - | - | - | - |
| share issue | | | | | |
+----------------------+-----------+------------+----------+-------------+--------------+
| Costs arising from | - | - | - | - | - |
| share issue | | | | | |
+----------------------+-----------+------------+----------+-------------+--------------+
| Net loss for the | - | - | - | - | (383,102) |
| year | | | | | |
+----------------------+-----------+------------+----------+-------------+--------------+
| Total recognised | - | - | - | (265,459) | (383,102) |
| income and expenses | | | | | |
+----------------------+-----------+------------+----------+-------------+--------------+
| Recognition of share | - | - | 26,769 | - | - |
| based payments | | | | | |
+----------------------+-----------+------------+----------+-------------+--------------+
| Balance at 30 June | 5,504,424 | 11,802,901 | 453,527 | (2,089,822) | (12,936,929) |
| 2009 | | | | | |
+----------------------+-----------+------------+----------+-------------+--------------+
CONSOLIDATED STATEMENT OF CASHFLOWS FOR THE YEAR ENDED 30 JUNE 2009
+----------------------------------------+---------+---------------+---------------+
| | | 2009 | 2008 |
+----------------------------------------+---------+---------------+---------------+
| | Notes | GBP | GBP |
+----------------------------------------+---------+---------------+---------------+
| | | | |
+----------------------------------------+---------+---------------+---------------+
| | | | |
+----------------------------------------+---------+---------------+---------------+
| Cash flow from Operating Activities | | | |
+----------------------------------------+---------+---------------+---------------+
| Receipt from customers | | 1,497,798 | 1,049,730 |
+----------------------------------------+---------+---------------+---------------+
| Payments to suppliers and employees | | (2,788,372) | (2,936,915) |
+----------------------------------------+---------+---------------+---------------+
| Payments for tax | | (15,501) | - |
+----------------------------------------+---------+---------------+---------------+
| Net cash used in operating activities | 8(a) | (1,306,075) | (1,887,185) |
+----------------------------------------+---------+---------------+---------------+
| | | | |
+----------------------------------------+---------+---------------+---------------+
| Cash flow from Investing Activities | | | |
+----------------------------------------+---------+---------------+---------------+
| Payments for property, plant and | | (1,992) | (5,520) |
| equipment | | | |
+----------------------------------------+---------+---------------+---------------+
| Receipts for property, plant and | | 111,864 | - |
| equipment | | | |
+----------------------------------------+---------+---------------+---------------+
| | | | |
+----------------------------------------+---------+---------------+---------------+
| Net cash generated from/(used in) | | 109,872 | (5,520) |
| investing activities | | | |
+----------------------------------------+---------+---------------+---------------+
| | | | |
+----------------------------------------+---------+---------------+---------------+
| Cash flow from Financing Activities | | | |
+----------------------------------------+---------+---------------+---------------+
| Proceeds from interest and investment | | 18,987 | 22,858 |
| income | | | |
+----------------------------------------+---------+---------------+---------------+
| Proceeds from issue of equity shares | | - | 2,240,353 |
+----------------------------------------+---------+---------------+---------------+
| Net cash generated from/(used in) | | 18,987 | 2,263,211 |
| financing activities | | | |
+----------------------------------------+---------+---------------+---------------+
| | | | |
+----------------------------------------+---------+---------------+---------------+
| Net (decrease)/increase in cash and | | (1,177,216) | 370,506 |
| cash equivalents | | | |
+----------------------------------------+---------+---------------+---------------+
| | | | |
+----------------------------------------+---------+---------------+---------------+
| Exchange gains on cash and cash | | 8,764 | 225,344 |
| equivalents | | | |
+----------------------------------------+---------+---------------+---------------+
| | | | |
+----------------------------------------+---------+---------------+---------------+
| Cash and cash equivalents at the | | 1,493,249 | 897,399 |
| beginning of the year | | | |
+----------------------------------------+---------+---------------+---------------+
| Cash and cash equivalents at the end | 8(b) | 324,797 | 1,493,249 |
| of the financial year | | | |
+----------------------------------------+---------+---------------+---------------+
| | | | |
+----------------------------------------+---------+---------------+---------------+
NOTES TO THE CONSOLIDATED FINANCIAL STATMENTS
FOR THE YEAR ENDED 30 JUNE 2009
1. Basis of Preparation and Going Concern
The financial information has been extracted from the Group's financial
statements that are prepared in accordance with International Financial
Reporting Standards (IFRS) as adopted by the European Union applied in
accordance with the provisions of the Companies Act 1985 and under the
historical cost convention.
The financial information for the period ended 30 June 2008 is derived from the
statutory accounts for that period which have been delivered to the Registrar of
Companies. The auditors reported on those accounts; their report was unqualified
and did not contain a statement under either Section 237 (2) or Section 237 (3)
of the Companies Act 1985.
The statutory accounts for the year ended 30 June 2009 is derived from the
statutory accounts for that period which will be delivered to the Registrar of
Companies. The auditors have reported on those accounts; their report was
unqualified and did not contain a statement under either Section 237 (2) or
Section 237 (3) of the Companies Act 1985.
Having considered the guidance given in the document Going Concern and Liquidity
Risk: Guidance for Directors of UK Companies issued in October 2009 by the
Financial Reporting Council, the Directors have formed a judgement that, at the
time of approving these financial statements there is a reasonable expectation
that the Group has adequate resources and likely income to continue in
operational existence for the foreseeable future and therefore adopt the going
concern basis for the financial statements. The continuing going concern of the
Group is dependent upon the Group achieving its sales forecasts and continuing
to increase the number of its machines that are in service. The Directors have
prepared forecasts which demonstrate that the Group will continue as a going
concern until at least 31 December 2010. Were the Group not to achieve its sales
forecasts then the Group may not continue as a going concern without obtaining
alternative sources of financing. The financial statements have therefore been
prepared on a going concern basis and do not contain the adjustments that might
arise if the Group ceases to be a going concern.
The auditors' report on the statutory accounts for the year ended 30 June 2009
included the following:
Emphases of Matter - Going Concern
We draw attention to the disclosures in Note 1 of the financial statements
regarding the directors' assumptions as to the continuing application of the
going concern concept. The directors are optimistic as to the continued
development of the business of the Group. However, unless an increase in sales
is achieved, there remains doubt as to the ability of the Group to continue as a
going concern. Were the Group not to achieve its sales forecasts then the Group
may not continue as a going concern without obtaining alternative sources of
financing.Our opinion is not qualified in this respect. The financial statements
do not include any adjustments that would result if the Group was unable to
continue as a going concern."
2. Foreign Exchange Gain
The Group earned a Foreign Exchange Gain of GBP302,822 (2008: GBP2,481,397) due
to the movement of the exchange rate between Pound Sterling and the Australian
Dollar over the financial year. This gain arose in the individual financial
statements of the Company's subsidiary CLVR Pty Ltd. The gain arose as a result
of inter-company financing and is unrealised. The remaining Foreign Exchange
Gain earned by the Group in the 2009 year of GBP414,907 (2008: GBPnil) relates
to the movement of exchange rates relating to trading balances.
3.Operating Profit/(Loss)
+--------------------------------------------------+-----+-----------+------------+
| | | 2009 | 2008 |
| | | GBP | GBP |
+--------------------------------------------------+-----+-----------+------------+
| | | | |
+--------------------------------------------------+-----+-----------+------------+
| Operating (Loss) / Profit is stated after | | | |
| charging: | | | |
+--------------------------------------------------+-----+-----------+------------+
| Depreciation | | 103,231 | 115,420 |
+--------------------------------------------------+-----+-----------+------------+
| Operating lease payments - land and buildings | | 226,491 | 197,527 |
+--------------------------------------------------+-----+-----------+------------+
| Share-based payments | | 26,769 | 9,743 |
+--------------------------------------------------+-----+-----------+------------+
| Research and development | | 8,248 | 16,587 |
| - expenditure in the year | | | |
+--------------------------------------------------+-----+-----------+------------+
4.Income tax expense
+--------------------------------------------------+--------+-----------+-----------+
| | | 2009 | 2008 |
| | | GBP | GBP |
+--------------------------------------------------+--------+-----------+-----------+
| | | | |
+--------------------------------------------------+--------+-----------+-----------+
| UK Taxation | | | |
+--------------------------------------------------+--------+-----------+-----------+
| - Current year UK corporation tax | | - | 95,368 |
+--------------------------------------------------+--------+-----------+-----------+
| - Amount in respect of previous year | |(353,474) | 302,226 |
+--------------------------------------------------+--------+-----------+-----------+
| | |(353,474) | 397,594 |
+--------------------------------------------------+--------+-----------+-----------+
| - Overseas taxation | | - | - |
+--------------------------------------------------+--------+-----------+-----------+
| | |(353,474) | 397,594 |
+--------------------------------------------------+--------+-----------+-----------+
| The charge for the year can be reconciled to the (loss) / | | |
| profit per the income statement as follows. | | |
| | | |
+-----------------------------------------------------------+-----------+-----------+
| (Loss) / Profit on ordinary activities before | |(736,576) |1,056,296 |
| tax | | | |
+--------------------------------------------------+--------+-----------+-----------+
| | | | |
+--------------------------------------------------+--------+-----------+-----------+
| (Loss) / Profit on ordinary activities | |(206,241) | 311,607 |
| multiplied by the standard rate of corporation | | | |
| tax on the UK income tax rate of 28.0% (2008: | | | |
| 29.5%) | | | |
+--------------------------------------------------+--------+-----------+-----------+
| Effect of revenue that is exempt from Taxation | | (88,645) |(732,012) |
+--------------------------------------------------+--------+-----------+-----------+
| Effect of expenses that are not deductible in | | 99,563 | 255,797 |
| determining taxable profit | | | |
+--------------------------------------------------+--------+-----------+-----------+
| Effect of unused tax losses and tax offsets | | 190,622 | 259,976 |
+--------------------------------------------------+--------+-----------+-----------+
| Effect of other timing differences | | 4,701 | - |
+--------------------------------------------------+--------+-----------+-----------+
| Adjustments to prior year tax | |(353,474) | 302,226 |
+--------------------------------------------------+--------+-----------+-----------+
| | | | |
+--------------------------------------------------+--------+-----------+-----------+
| Income tax (benefit) / expense recognised in | |(353,474) | 397,594 |
| income statement | | | |
+--------------------------------------------------+--------+-----------+-----------+
Deferred taxation
The Group has losses carried forward estimated at GBP14,405,164 (2008 -
GBP12,891,407) that give rise to a deferred taxation asset. This asset has not
been incorporated into the financial statements as it is not certain at the
balance sheet date that profits in the foreseeable future will be sufficient to
allow this balance to be utilised.
UK Taxation - amount in respect of previous year
In the financial statements for the year ended 30 June 2008 the Group provided
GBP302,226 in respect of adjustments to the tax computations for the years ended
30 June 2005, 2006 and 2007 and for potential penalties. Following completion of
the 30 June 2008 audit, representations were made to HMRC to allow for the
reassessment of these prior year tax returns. HMRC have now confirmed that it
accepts the revised adjustments, therefore the GBP302,226 provision is no longer
required. In addition to this amount, GBP51,248 of tax provided for in the 2008
year in respect of the tax computation for the year ended 30 June 2008 has been
released given the provision is no longer required.
5. Earnings per share
+--------------------------------------------------+--------------+--------------+
| | 2009 | 2008 |
+--------------------------------------------------+--------------+--------------+
| | | |
+--------------------------------------------------+--------------+--------------+
| Basic (loss) / earnings per share | (0.22)p | 0.56p |
+--------------------------------------------------+--------------+--------------+
| Diluted (loss) / earnings per share | (0.22)p | 0.56p |
+--------------------------------------------------+--------------+--------------+
| | | |
+--------------------------------------------------+--------------+--------------+
The calculation of basic and diluted earnings per share was based on a weighted
average number of shares calculated as follows:
+------------------------------------------------------+--------------+-------------+
| | 2009 | 2008 |
+------------------------------------------------------+--------------+-------------+
| | Number of shares |
| | |
+------------------------------------------------------+----------------------------+
| Issued ordinary shares at 1 July | 169,165,848 | 95,319,148 |
+------------------------------------------------------+--------------+-------------+
| Shares issued during the year | - | 73,846,700 |
+------------------------------------------------------+--------------+-------------+
| Weighted average number of ordinary shares 30 June | 169,165,848 | 117,922,043 |
| (basic) | | |
+------------------------------------------------------+--------------+-------------+
| Weighted average number of ordinary shares 30 June | 169,165,848 | 117,922,043 |
| (diluted) | | |
+------------------------------------------------------+--------------+-------------+
| | | |
+------------------------------------------------------+--------------+-------------+
| (Loss) / Profit used in calculating basic and | GBP(383,102) | GBP658,702 |
| diluted (loss) / earnings per share from continuing | | |
| operations | | |
+------------------------------------------------------+--------------+-------------+
Diluted (loss) / earnings per share has been calculated using the same figures
as the basic calculation. No account has been taken of options, as these
potential ordinary shares are not considered to be dilutive under the
definitions of the applicable accounting standards.
On 5 October 2009, the Company issued 23,030,000 ordinary shares. Allowing for
the issue of these shares, the calculation of loss per share based upon the
group loss incurred for the year ended 30 June 2009 for basic and diluted loss
per share would be 0.20p per share.
6. Property, Plant and Equipment
+--------------------+------------+--------------+--------------+----------+----------+
| | Plant & | Fixtures, | Leasehold | Leased | Total |
| | Machinery | fittings & |Improvements | Assets | |
| | | equipment | | | |
+--------------------+------------+--------------+--------------+----------+----------+
| | GBP | GBP | GBP | GBP | GBP |
+--------------------+------------+--------------+--------------+----------+----------+
| Cost | | | | | |
+--------------------+------------+--------------+--------------+----------+----------+
| At 1 July 2007 | 312,734 | 154,549 | 19,234 | 171,141 | 657,658 |
+--------------------+------------+--------------+--------------+----------+----------+
| Exchange | 19,644 | 2,024 | 1,551 | - | 23,219 |
| differences | | | | | |
+--------------------+------------+--------------+--------------+----------+----------+
| Additions | 4,503 | 1,017 | - | - | 5,520 |
+--------------------+------------+--------------+--------------+----------+----------+
| At 30 June 2008 | 336,881 | 157,590 | 20,785 | 171,141 | 686,397 |
+--------------------+------------+--------------+--------------+----------+----------+
| Exchange | 6,848 | 3,204 | 423 | - | 10,475 |
| differences | | | | | |
+--------------------+------------+--------------+--------------+----------+----------+
| Additions | 1,635 | 357 | - | - | 1,992 |
+--------------------+------------+--------------+--------------+----------+----------+
| Disposals | - | - | - | (25,284) | (25,284) |
+--------------------+------------+--------------+--------------+----------+----------+
| At 30 June 2009 | 345,364 | 161,151 | 21,208 | 145,857 | 673,580 |
+--------------------+------------+--------------+--------------+----------+----------+
| | | | | | |
+--------------------+------------+--------------+--------------+----------+----------+
| Depreciation | | | | | |
+--------------------+------------+--------------+--------------+----------+----------+
| At 1 July 2007 | 215,363 | 144,517 | 11,546 | 67,570 | 438,996 |
+--------------------+------------+--------------+--------------+----------+----------+
| Exchange | - | - | - | (13,293) | (13,293) |
| differences | | | | | |
+--------------------+------------+--------------+--------------+----------+----------+
| Charge for the | 38,225 | 13,002 | 4,450 | 59,743 | 115,420 |
| year | | | | | |
+--------------------+------------+--------------+--------------+----------+----------+
| At 30 June 2008 | 253,588 | 157,519 | 15,996 | 114,020 | 541,123 |
+--------------------+------------+--------------+--------------+----------+----------+
| Exchange | 5,155 | 3,202 | 325 | - | 8,682 |
| differences | | | | | |
+--------------------+------------+--------------+--------------+----------+----------+
| Disposals | - | - | - | (22,986) | (22,986) |
+--------------------+------------+--------------+--------------+----------+----------+
| Charge for the | 47,745 | 41 | 2,745 | 52,700 | 103,231 |
| year | | | | | |
+--------------------+------------+--------------+--------------+----------+----------+
| At 30 June 2009 | 306,488 | 160,762 | 19,066 | 143,734 | 630,050 |
+--------------------+------------+--------------+--------------+----------+----------+
| | | | | | |
+--------------------+------------+--------------+--------------+----------+----------+
| Net book value | | | | | |
+--------------------+------------+--------------+--------------+----------+----------+
| At 30 June 2008 | 83,293 | 71 | 4,789 | 57,121 | 145,274 |
+--------------------+------------+--------------+--------------+----------+----------+
| At 30 June 2009 | 38,876 | 389 | 2,142 | 2,123 | 43,530 |
+--------------------+------------+--------------+--------------+----------+----------+
7. Trade and other payables
+--------------------------------------------------+--------------+------------+
| | 2009 | 2008 |
+--------------------------------------------------+--------------+------------+
| | GBP | GBP |
+--------------------------------------------------+--------------+------------+
| Current | | |
+--------------------------------------------------+--------------+------------+
| Trade Creditors | 521,253 | 273,446 |
+--------------------------------------------------+--------------+------------+
| Director's current account | 7,398 | 20,734 |
+--------------------------------------------------+--------------+------------+
| Other creditors | 238,436 | 206,800 |
+--------------------------------------------------+--------------+------------+
| Accruals and deferred Income | 240,701 | 248,484 |
+--------------------------------------------------+--------------+------------+
| | 1,007,788 | 749,464 |
+--------------------------------------------------+--------------+------------+
| Non-current | | |
+--------------------------------------------------+--------------+------------+
| Accruals and deferred Income | 302,276 | 189,100 |
+--------------------------------------------------+--------------+------------+
| | 302,276 | 189,100 |
+--------------------------------------------------+--------------+------------+
Trade Creditors are settled in accordance with terms of the supplier. Accrued
expenses are an assessment of amounts due and payable but for which invoices
have not yet been received.
Deferred Warranty Income is recognised on a pro-rata basis, and at amortised
cost, depending on the terms and conditions of the sale agreement with the
customer.
8. Reconciliation of cash flows from operating activities
+-------------------------------------------+-----------------+-----------------+
| | 2009 | 2008 |
+-------------------------------------------+-----------------+-----------------+
| | GBP | GBP |
+-------------------------------------------+-----------------+-----------------+
| (a) Cash flows from operating activities | | |
+-------------------------------------------+-----------------+-----------------+
| | | |
+-------------------------------------------+-----------------+-----------------+
| After tax (loss) / profit for the period | (383,102) | 658,702 |
+-------------------------------------------+-----------------+-----------------+
| Adjustments for Non-Cash Items | | |
+-------------------------------------------+-----------------+-----------------+
| Equity settled share based payment | 26,769 | 9,743 |
| expense | | |
+-------------------------------------------+-----------------+-----------------+
| Bad debts provision | 404,003 | 30,000 |
+-------------------------------------------+-----------------+-----------------+
| Net Finance costs | (15,321) | (22,858) |
+-------------------------------------------+-----------------+-----------------+
| Provision against loans with group | - | - |
| undertakings | | |
+-------------------------------------------+-----------------+-----------------+
| Transactions with group undertakings | - | - |
+-------------------------------------------+-----------------+-----------------+
| Depreciation | 103,231 | 115,420 |
+-------------------------------------------+-----------------+-----------------+
| Profit on disposal of property, plant and | (109,567) | - |
| equipment | | |
+-------------------------------------------+-----------------+-----------------+
| Foreign exchange gains | (717,860) | (2,481,397) |
+-------------------------------------------+-----------------+-----------------+
| Operating loss before changes in working | (691,847) | (1,690,390) |
| capital and provisions: | | |
+-------------------------------------------+-----------------+-----------------+
| Changes in assets and liabilities | | |
| (excluding the effects of acquisition and | | |
| exchange differences on consolidation): | | |
+-------------------------------------------+-----------------+-----------------+
| Decrease/ (Increase) in trade and other | (963,248) | (604,388) |
| receivables | | |
+-------------------------------------------+-----------------+-----------------+
| Decrease/ (Increase) in inventories | 341,607 | (3,378) |
+-------------------------------------------+-----------------+-----------------+
| Increase in trade and other payables | 376,388 | 13,377 |
+-------------------------------------------+-----------------+-----------------+
| Increase/(Decrease) in provision for | (368,974) | 397,594 |
| taxation | | |
+-------------------------------------------+-----------------+-----------------+
| | | |
+-------------------------------------------+-----------------+-----------------+
| Net cash flows (used in)/generated from | (1,306,074) | (1,887,185) |
| operating activities | | |
+-------------------------------------------+-----------------+-----------------+
+--------------------------------------------+------+--------------+--------------+
| (b) Reconciliation of cash and cash | | |
| equivalents | | |
+--------------------------------------------+------+-----------------------------+
| | | 2009 | 2008 |
+--------------------------------------------+------+--------------+--------------+
| | | GBP | GBP |
+--------------------------------------------+------+--------------+--------------+
| Cash at bank and at call | | 324,797 | 1,493,249 |
+--------------------------------------------+------+--------------+--------------+
| | | | |
+--------------------------------------------+------+--------------+--------------+
10. Dividends
The Directors do not propose the payment of a dividend for the year ended 30
June 2009.
11. Availability of Report and Accounts
A copy of the Annual Report and Accounts will be sent to all shareholders
shortly and will be available from the offices of Merchant John East Securities
Limited, 10 Finsbury Square, London EC2A 1AD and from the Company's website
www.customvis.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR GBBDDBGXGGCG
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