Preliminary Results
13 Février 2001 - 8:00AM
UK Regulatory
RNS Number:7754Y
Skillsgroup PLC
13 February 2001
Skillsgroup plc
Preliminary Results for the year ended 30th November 2000
"A developing vision for the future"
Highlights
Skillsgroup plc, a leading information technology services
specialist and the UK's number one IT training company, is
pleased to announce the following:
* Turnover from continuing businesses increased by 2.5% to
#56.4m (1999: #55.0m)
* Adjusted* EPS 3.7p (1999: 8.6p)
* Continuing businesses adjusted operating profits before
internet project and central costs up 13.9% to #12.3m
(1999: #10.8m)
* Continuing businesses adjusted operating margin before
internet project and central costs of 21.8% (1999: 19.6%)
* Headline loss before tax of #17.4m (1999: profit before
tax #11.4m)
* Total dividend of 5.8p per share (1999: 5.7p), up 1.7%
* Strong balance sheet - year end net cash #1.8m
* All legacy issues dealt with - the Group enters 2001 on a
clean and focused basis
* Name change and reorganisation creates "One Company, One
Brand" - QA plc
*i.e. continuing operations, before all exceptionals and
goodwill amortisation
Commenting on the results, Keith Burgess, the new Executive
Chairman said:
"The start of financial year 2001 has been satisfactory with
revenue and profits ahead of last year. The Group's
reorganisation and rebranding is progressing well and
management is concentrating on driving growth in our business.
While it will take time for the changes we are making to work
through, we look forward to a year in which we can begin to
demonstrate the advantages of a focussed operation in driving
value and growth into the Group."
For further information, please contact:
Skillsgroup plc on 13th Feb 2001: 0207 253 2252
Dr Keith Burgess, Executive Chairman
thereafter: 020 7656 8495
Colin Gibson, Finance Director
www.skillsgroup.co.uk
Golin/Harris Ludgate 0207 253 2252
Reg Hoare / Edward Macquisten
Chairman's Statement
Introduction
This is my first report as Chairman of Skillsgroup. I am
pleased to outline the progress made by the business in the
past twelve months and to provide an insight into our
developing vision for the future.
I joined the business in November 2000 in time to help ensure
the disposal of Acuma that completed the transition from
products distributor to information technology services
specialist. This change has taken six years and has been a
very major factor in the volatility of our results and share
price over that period. The major disposals of our lower
margin businesses during the past year - QA Myriad for #31.4
million and Acuma for #4.5 million - leave us more focused
than at any time in Skillsgroup's recent history.
In the past year, external market conditions were unusual even
for a sector accustomed to the unusual. The Y2K effect
adversely affected us, like many others, with many corporate
spending plans, resources and projects put on hold in case of
problems associated with date compliance. Traditional IT
projects spending took longer to recover than most
commentators had predicted and in some areas the recovery has
been more limited than was expected. At the same time, the
world awoke to the potential of the Internet - and the hype of
a new-world economy - giving rise to a short-lived boom in
demand for technology stocks.
Internally, the previous financial year had been a year of
significant acquisitions. Going into 2000, a number of
management changes were made and action was taken to
restructure and integrate the recently acquired Pontis
Consulting, Cap Gemini Training and GA Information Services
businesses.
These external and internal factors served to produce a weak
financial performance in the first half of the year. The
second half was stronger and, in training at least, gives a
more encouraging indication of what the Company can achieve
with the operations that remain.
Financial Results
Turnover for continuing operations in the year to 30 November
2000 was #56.4 million, compared with #55.0 million in 1999,
which included only the post-acquisition results of the
businesses acquired in that year. The full year turnover of
QA Training was marginally down on 1999 on a like-for-like
basis, but second half like-for-like growth was 7.9%. Revenue
in the Pontis Consulting business was 31.5% lower than 1999 on
a like-for-like basis with some of this reduction due to an
inability to preserve the pre-Y2K revenues of the former QA
Consulting operation integrated at the end of 1999. While
tight control was maintained on operations, additional work
will be needed to re-establish the growth in this business
following the retrenchment of the earlier part of the year.
The overall results for Skillsgroup were impacted by costs of
#6.6 million on initiatives designed to achieve a significant
acceleration in the progress its businesses were making in e-
commerce and web-related areas. These we have termed as
internet projects. Before the impact of these costs, QA
Training's operating margin adjusted to exclude exceptionals
and goodwill amortisation ("adjusted") was up from 18.2% to
21.6%. After internet project costs the adjusted operating
margin was 12.8%. In Pontis Consulting, the adjusted
operating margin was 22.5% before internet project costs and
15.8% after them, compared with a 1999 adjusted operating
margin of 24.1%.
Adjusted operating profits for the continuing operations were
up 13.9% to #12.3 million before internet project costs and
central costs. The overall operating margin for QA Training
and Pontis Consulting together on this basis grew from 19.6%
to 21.8%. Against the backdrop of the early restructuring
described and a weak market, particularly in the first half,
this represents a satisfactory if unexciting result.
In addition to the internet project investment programme, our
total net trading performance was affected by the significant
loss in the Acuma business - #5.3 million before internet
project costs, goodwill and exceptionals compared with a #3.2
million profit in 1999.
There is also a significant exceptional charge totalling #13.0
million comprising both operating and non-operating elements.
The non-operating charges included a loss of #18.9 million
(including #0.7 million provision for expected December
trading losses) resulting from the Acuma disposal. This was
offset in part by a #10.8 million profit on the disposal of QA
Myriad and by a #0.6 million gain from the disposal of a small
trade investment acquired in 1998 as part of the closure of QA
Training's US operation. Furthermore, separate property-
related charges totalling #3.4 million were required. These
comprised a #2.9 million non-operating write-down of carrying
values and a #0.5 million operating provision for onerous
lease commitments arising from surplus properties retained
following current year and prior year business disposals. The
balance of the operating charges total #2.1 million and relate
to restructuring actions taken in Acuma, to the Board changes
near the year end and to exceptional write-downs of debtors
and accrued income in Pontis. As a result, all legacy issues
have been dealt with and we enter 2001 on a clean and focused
basis.
As a result of these factors, the previous year's profit
before tax of #11.4 million was turned into a #17.4 million
loss with basic EPS of 10.8 pence converted into a loss per
share of 18.4 pence. Adjusted EPS for the operations, which
are now classified as continuing, were down from 8.6 pence to
3.7 pence with the internet project costs charged to
continuing operations responsible for 4.7 pence of this
reduction. A change from interest receivable to interest
payable accounted for most of the balance.
Over the year the business generated #11.7 million of
operating cashflow from the continuing businesses after all
central costs and finished the year with a small positive net
cash position.
Dividend
The Board proposes to retain the final dividend at 4.0 pence
(1999: 4.0 pence) making a total of 5.8 pence for the year
(1999: 5.7 pence).
Internet Projects
Turning now to the internet projects, the bulk of the spending
was within QA Training where #2.5 million was spent on
developing and implementing eDynamix, a market-leading e-
commerce booking system, together with related back-office
system changes. This system has now been implemented in 70
corporate customers and includes a dynamic discounting model,
which encourages forward booking and customer loyalty. A
further #1.4 million was spent within the training business
mainly to progress the development of certain web-based
training (i.e. e-learning) products and integrated learning
offerings, which blend web-based elements with traditional
methods. Sales of these offerings will commence in the first
half of this year.
Having identified significant opportunities in the market for
managing the skills development processes in major corporates
using web-based learning management technologies, we have
invested #1.3 million under the Avansar initiative developing
business plans and some initial consulting capability in this
area.
The balance of our internet project costs relates to the
enhancement and development of our technical consulting
capabilities in web-based technologies, and to the development
of the IDS product within the now-sold Acuma business. In
addition, the acquisition in June of Direct Media Technology
for a capital cost of #5.3 million gave us access to our own
learning management system and experience of selling e-
learning products.
Strategy for Growth
As we enter the 2001 fiscal year, Skillsgroup comprises two
businesses, the QA training business and the Pontis technology
consulting business, which are operating soundly and have
considerable untapped potential. Additionally, we see a
number of opportunities in the areas of human capital
development and in the implementation of learning management
systems, but whether these opportunities will materialise and
can be seized by us is at this point, unproven.
Positioning
The first step is to clearly position and focus the business.
Our aim is to be recognised as a specialist IT services
business that improves the IT effectiveness of large
organisations. Our focus is on enhancing the skills of
people, optimising human capital investment and providing IT
expertise that complements in-house skills. In doing so, we
will help clients to be more efficient, effective and
innovative, adding value to their organisation overall.
One Business Organisation
Until now, we have adopted a fragmented approach by operating
through separate relatively autonomous businesses for each
area of specialisation. We are changing this approach to
operate as one integrated business with four divisions:
* Training
* Technology Consulting
* Human Capital Development
* Learning Products
The training, technology consulting and learning products
divisions are clearly formed from QA Training, Pontis
Consulting, and the recently acquired DMT business. In the
human capital development division, we are bringing together
all relevant consulting skills that were previously dispersed
throughout the Group including those previously being
assembled under the Avansar initiative.
As one business we aim to leverage our client relationships
and channels to market; achieve operational efficiencies and
cost savings; more effectively share and manage information
and knowledge; and more effectively utilise staff and
management skills.
We have redefined our approach to management with the
formation of a single management team. The objective is to
create an integrated and cohesive company that is able to
realise the potential of its impressive client base, high
quality training portfolio, experienced team of technology and
architecture consultants and emerging market opportunities.
A Single Brand Identity
We intend to rename all areas of the business as QA during
February 2001 and in support of this, we are establishing
single sales and marketing organisation. QA is already a well-
recognised name in the market and we will invest to build,
over time, a significant brand for the business. This process
will be helped by the realignment of all marketing efforts in
support of one identity - leveraging all our resources in a
single direction.
In doing this, we will achieve better visibility for our
marketing efforts. The change of company names is being
managed through a well-defined communications programme
designed to protect the goodwill built-up in the outgoing
company names and to ensure a smooth transition for all
stakeholders. In view of this change, we propose to rename
the parent company as QA plc. Shareholder approval will be
sought for this change at the Annual General Meeting on 27
April 2001.
Furthermore, the reorganised business will be supported by
centralised finance, human resource and administration
functions, which will help ensure more efficient and cost-
effective support for the entire business.
Board changes
In addition to the major changes in the focus of the business,
this year has also seen a number of changes in Skillsgroup's
senior management and our thanks are due to the retiring
directors for their contribution. Over the course of the
year, Philip Livesey and Mike McGoun stepped down as non-
executive directors. Robert Hough and Helen Weir joined the
Board in June with Robert becoming non-executive deputy
Chairman on 14 November 2000. David Ince left the Board in
December 2000 on the completion of the Acuma disposal. David
Southworth left the Board at the year-end after 14 years as
Chief Executive and latterly as Executive Chairman. I
succeeded David as Executive Chairman on 14 November 2000 and
wish to offer him the thanks of the Board for his considerable
contribution to the business over a long and difficult period.
In Conclusion
The start of financial year 2001 has been satisfactory with
revenue and profits ahead of last year.
We believe that the human capital and learning products areas
do have a genuine opportunity this year and we recognise we
must continue investing in these areas during the next fiscal
year though we intend to ensure that the extent of this
investment remains within our means. Our reorganisation and
rebranding is progressing well and management is concentrating
on driving growth in our business.
While it will take time for the changes we are making to work
through, we look forward to a year in which we can begin to
demonstrate the advantages of a focused operation in driving
value and growth into the business.
Skillsgroup plc
Preliminary results for the year ended 30 November 2000
Consolidated Profit and Loss Account
2000 1999
as restated
Notes #m #m
Turnover
Continuing operations 1 56.4 55.0
Discontinued operations 1 84.3 143.7
_________________
140.7 198.7
_________________
Operating (loss)/profit
Continuing operations 1 0.7 6.5
Discontinued operations 1 (7.2) 4.5
________________
(6.5) 11.0
Provision for loss on disposal of
fixed asset - continuing 3 (2.9) -
Profit on sale of fixed asset
investment - continuing 3 0.6 -
Net loss on sale of discontinued
operations 3 (8.1) -
(10.4) -
________________
(Loss)/profit on ordinary
activities before interest (16.9) 11.0
Net interest (payable)/receivable (0.5) 0.4
_________________
(Loss)/profit on ordinary
activities before taxation (17.4) 11.4
Tax on (loss)/profit on ordinary
activities 1.2 (2.1)
_________________
(Loss)/profit on ordinary activities
after taxation (16.2) 9.3
Dividends (5.1) (5.0)
_________________
Transfer (from)/to reserves (21.3) 4.3
_________________
Basic (loss)/earnings per share 5 (18.4)p 10.8p
_________________
Fully diluted (loss)/ earnings
per share 5 (18.4)p 10.7p
_________________
Adjusted earnings per share * 5 3.7p 8.6p
_________________
Adjusted fully diluted earnings
per share * 5 3.7p 8.5p
_________________
* adjusted to exclude discontinued operations, operating and
non operating exceptional items and goodwill amortisation
There are no recognised gains or losses other than the loss for
the year.
Skillsgroup plc
Preliminary results for the year ended 30 November 2000
Consolidated Balance Sheet
2000 2000 1999 1999
#m #m #m #m
Fixed assets
Intangible assets 66.0 78.5
Tangible assets 11.9 17.6
Investments 2.9 -
______ _____
80.8 96.1
______ _____
Current assets
Stock 0.5 0.9
Debtors 24.6 48.3
Cash at bank and in hand 15.3 3.6
______ _____
40.4 52.8
Creditors - amounts due
within one year
Borrowings (8.2) (17.9)
Other creditors (37.6) (47.6)
______ _____
(45.8) (65.5)
______ _____
Net current liabilities (5.4) (12.7)
Total assets less current
liabilities 75.4 83.4
Creditors - amounts due
after one year
Borrowings (5.3) (6.1)
Other creditors (0.4) (1.2)
______ _____
(5.7) (7.3)
Provisions for liabilities
and charges (3.3) (1.5)
______ _____
Net assets 66.4 74.6
______ _____
Capital and reserves
Called up share capital 8.8 8.8
Deferred share capital 3.5 4.6
Share premium 45.4 44.5
Other reserves 1.5 1.5
Profit and Loss account 7.2 15.2
______ _____
Equity shareholders' funds 66.4 74.6
______ _____
Skillsgroup plc
Preliminary results for the year ended 30 November 2000
Consolidated Cashflow Statement
2000 1999
#m #m
Reconciliation of operating profit
to net cash flow from operating
activities
Operating (loss)/profit (6.5) 11.0
Goodwill amortisation 4.5 2.4
Depreciation 4.2 3.7
Profit on fixed assets disposals - (0.2)
Decrease in stock 0.3 1.0
Decrease/(increase) in debtors 13.9 (1.6)
(Decrease)/increase in creditors (6.4) 0.4
Increase/(decrease) in provisions 0.3 (0.5)
_________________
Net cash inflow from operating activities 10.3 16.2
_________________
Consolidated cash flow statement 2000 1999
#m #m
Net cash inflow from operating activities 10.3 16.2
Returns on investments and servicing of
Finance Net interest (paid)/received (0.6) 0.9
Taxation
Corporation tax paid (3.5) (3.5)
Capital expenditure and financial investment
Purchase of fixed assets (3.5) (3.4)
Purchase of fixed asset investment (2.9) -
Fixed assets disposals 0.2 0.4
Sale of trade investment 0.9 -
(5.3) (3.0)
Acquisition and disposals
Acquisition of businesses
- total impact on net cash/ borrowings (5.5) (61.2)
- increase in borrowings(excluding
overdrafts) 4.2 22.5
Cash outflow from acquisitions
_________ ______
(including net overdraft acquired of
#0.1 million) (1.3) (38.7)
Disposal of businesses 31.0 0.2
29.7 (38.5)
Equity dividend paid (5.0) (4.4)
_________________
Net cash inflow/(outflow) before financing 25.6 (32.3)
_________________
Skillsgroup plc
Preliminary results for the year ended 30 November 2000
Notes
1 Segmental report
The analysis of turnover and operating profit by business
group is as follows:
# million
2000 2000 Inte- Opera- Good Cent- Total
Turn- Opera- rnet ting will ral
over ting Proj- Except Amorti- Costs
Profit ect ional sation alloc
Base Costs items -ation
(note 2)(note 3)
Continuing
Operations
QA Training 44.4 9.6 (3.9) - (1.7) - 4.0
Pontis
Consulting 12.0 2.7 (0.8) (0.6) (1.6) - (0.3)
Avansar - - (1.3) - (0.5) - (1.8)
Central Costs - - - - - (1.2) (1.2)
________________________________________________________________
56.4 12.3 (6.0) (0.6) (3.8) (1.2) 0.7
Discontinued
Operations
QA Myriad 30.7 1.4 - - - - 1.4
Acuma
Solutions 53.6 (5.3) (0.6) (0.9) (0.7) - (7.5)
Central Costs - - - - - (1.1) (1.1)
________________________________________________________________
84.3 (3.9) (0.6) (0.9) (0.7) (1.1) (7.2)
Central Costs - (1.2) - (1.1) - 2.3 -
________________________________________________________________
140.7 7.2 (6.6) (2.6) (4.5) - (6.5)
________________________________________________________________
# million
1999 1999 Inte- Opera- Good Cent- Total
Turn- Opera- rnet ting will ral
over ting Proj- Except Amorti- Costs
Profit ect ional sation alloc
Base Costs items -ation
Continuing
Operations
QA Training 41.7 7.6 - (0.8) (1.1) - 5.7
Pontis
Consulting 13.3 3.2 - (0.3) (1.2) - 1.7
Central Costs - - - - - (0.9) (0.9)
________________________________________________________________
55.0 10.8 - (1.1) (2.3) (0.9) 6.5
Discontinued
Operations
QA Myriad 63.2 3.3 - - - - 3.3
Acuma
Solutions 80.5 3.2 - (0.2) (0.1) - 2.9
Central Costs - - - - - (1.7)(1.7)
________________________________________________________________
143.7 6.5 - (0.2) (0.1) (1.7) 4.5
Central Costs - (1.2) - (1.4) - 2.6 -
________________________________________________________________
198.7 16.1 - (2.7) (2.4) - 11.0
________________________________________________________________
2 Internet project costs
# million
QA Training
e-commerce systems (2.5)
e-learning products (1.4)
_____
(3.9)
Pontis Consulting (0.8)
Avansar (1.3)
Acuma (0.6)
_____
(6.6)
_____
In QA Training costs of #2.5 million were incurred on
developing and implementing eDynamix, a market leading e-
commerce booking system (together with associated back
office systems). A further #1.4 million was incurred on
the development and preliminary marketing of e learning
products which includes web based and integrated learning
products.
In Pontis Consulting #0.8 million of costs were incurred on
the enhancement and development of technical consulting
capabilities in web based technologies.
#1.3 million of costs were incurred under the Avansar
initiative on the development of business plans and some
initial consulting capability in the market for managing
the skills developments processes in major corporates,
using web based learning management technologies.
The balance of the spending of #0.6 million was used for
the development and marketing of the IDS product within the
Acuma business prior to its disposal.
3 Exceptional Items
Operating exceptional items
# million
Exceptional bad debt/ accrued revenue provisions (0.6)
Restructuring costs (0.9)
Board changes (0.6)
Provision for onerous property leases (0.5)
_____
(1.1)
_____
(2.6)
_____
The bad debt and accrued revenue provisions relate to
balances in Pontis Consulting brought forward from 1999,
which are not now expected to be recovered. These are
considered exceptional due to their size.
The restructuring costs relate to redundancies and other
charges associated with headcount reductions made in Acuma
during the year prior to the disposal of that business.
The exceptional costs for the board changes comprise
severance costs for DR Southworth and MF McGoun on 30
November 2000, and recruitment expenses for the new
chairman, Dr K Burgess.
A review of the properties held at the year end resulted in
an increase of #0.5 million to the provision for onerous
leases. This represents costs that are expected to arise as
sub leases end and include provisions for marketing, legal
and dilapidation costs, and any anticipated future rent
shortfalls.
The operating exceptional charge in 1999 includes #1.4
million relating to the writedown of the P&P UK desktop
sales proceeds and additional provisions for leases and
other costs arising from that disposal and #1.3 million
restructuring costs which related principally to severance
and other integration costs following the 1999
acquisitions.
Non operating exceptional items
# million
Provision for loss on disposal of fixed asset (2.9)
Profit on sale of fixed asset investment 0.6
Profit on sale of QA Myriad 10.8
Loss on sale of Acuma Solutions (18.9)
______
Net loss on sale of discontinued operations (8.1)
______
(10.4)
______
The former P&P headquarters building has been sold since
the year end for #1.1 million and an exceptional charge has
been made to write it down to that value at 30 November
2000.
QA Training disposed of its investment in Wave Inc. in
March 2000 for a consideration of #0.9 million. This
investment has not, in prior financial statements, been
included within fixed assets on the grounds of materiality.
It was acquired in 1998 in exchange for the assets of QA
Training's small US operation.
QA Myriad was sold to a subsidiary of Hays plc on 27 June
2000 for a cash consideration of #31.4 million, which has
been received in full. The total consideration includes an
upward adjustment of #0.2 million, which arose on the
agreement of the net working capital at completion.
A contract for the sale of GA Information Services Limited
and substantially all of the assets of Acuma Solutions to a
subsidiary of JZ International plc was entered into
immediately prior to the year end. The disposal was
approved by shareholders at an extraordinary general
meeting held on 22 December 2000. The total effective
consideration at completion was #7.0 million, and this
includes #2.5 million of deferred contingent consideration;
the initial consideration was split equally between cash
and loan notes. The loss on disposal, which does not take
account of the deferred consideration, is #18.9 million and
includes a #0.7 million provision for operating losses
incurred in Acuma from 30 November 2000, until the date of
completion of the disposal on 22 December 2000. Under the
terms of the sale agreement the consideration is subject to
adjustment by reference to the level of indebtedness and
working capital in the business at the date of completion.
4 The 1999 accounts are abridged from the Group's full
accounts on which the auditors have given an unqualified
opinion. The 2000 statutory accounts will be filed with the
Registrar of Companies in due course. The Group accounts
include the accounts of the Company and all its
subsidiaries made up to the end of the financial year,
which is within one week of the end 30 November. The
accounts have therefore been prepared for 53 weeks ended 2
December 2000 (1999: 52 weeks ended 27 November 1999).
5 The calculation of basic earnings per share is based upon
profits on ordinary activities after taxation and a
weighted average of 87,909,000 (1999: 86,005,790) shares
and the fully diluted earnings per share is based on a
weighted average of 88,165,000 (1999: 86,571,076) shares.
The calculation of adjusted earnings per share is based on
continuing operations profits before goodwill amortisation,
operating and non operating exceptional charges.
6 Copies of the Group's full report and accounts will be sent
to all shareholders in due course. Additional copies will
be available from the Company's registered office,
Skillsgroup plc, Bridgford House, Heyes Lane, Alderley
Edge, Cheshire, SK9 7JP.
7 The AGM will be held on 27 April 2001.
8 At a meeting held on 1 February 2001, the Board of
Skillsgroup plc recommended payment of a final dividend of 4.0
pence per share to holders of 10 pence ordinary shares on the
register at the close of business on 23 March 2001.
9 The recommended final dividend, together with the interim
dividend already paid, make a total dividend for the year of
5.8 pence, compared with 5.7 pence for 1999.
10 This statement constitutes non-statutory accounts within
the meaning of Section 240 of the Companies Act 1985 and was
approved by the Directors and agreed with the Company's
auditors PricewaterhouseCoopers on 13 February 2001.
Smurfit Kappa (LSE:SKG)
Graphique Historique de l'Action
De Juin 2024 à Juil 2024
Smurfit Kappa (LSE:SKG)
Graphique Historique de l'Action
De Juil 2023 à Juil 2024
