Interim Results
28 Février 2003 - 8:00AM
UK Regulatory
RNS Number:0914I
Farsight PLC
28 February 2003
FARSIGHT PLC
INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 NOVEMBER 2002
Chairman's Statement
I am pleased to present my report for the six months ended 30th November 2002, a
period that has seen a considerable re-organisation of the business that will be
reflected in the results for the full year ending 31st May 2003.
In the annual report for the year ended 31st May 2002, we affirmed that as a
result of the #1.5 million raised from the Placing and Open Offer, the
appointment of a new Chief Executive and the implementation of a new strategy,
Farsight plc should return to profitability within the second half of 2003. I am
confident that a return to profitability will be achieved within the next two
quarters, and that the operating business will be broadly cash neutral over the
next six months.
The Results and Dividends
The loss on ordinary activities before taxation was #978,000 (2001: loss
#929,000) on turnover of #597,000 (2001: #1.65 million). The loss includes
#196,000 of exceptional costs incurred in the business re-organisation, and also
#147,000 of amortised goodwill (2001: #274,518).
We are not in a position to recommend a dividend.
As at 30th November, Farsight plc had no bank debt and #491,000 cash at bank and
in hand.
Trading Review
Farsight Security
Significant new business has been secured over the last six months, including a
#110,000 pa contract with one of the UK's leading motor retailers. The sales
operation has been reinforced and re-motivated. Since September we have
consistently won new business each month. A healthy pipeline of new business
prospects has been developed and will ensure our sales growth during 2003.
In particular, I am pleased to announce a joint venture initiative with
Chesterton Workplace Management to reduce the cost of manned guards across over
1,000 of their sites in the UK. Chesterton Workplace Management is the facility
management division of Chesterton International. This partnership allows
Chesterton to offer Farsight's security expertise and remote video monitoring
services across their client base in order to defray the extra cost associated
with the European Working Time Directive, which affects the cost of employing
manned guards.
As a Remote Video Monitoring operation, Farsight is reliant on a number of
security installation companies who place the CCTV monitoring connections. At
present there are 10 installation companies with whom we have developed
professional working relationships. In the next 12 months a number of supplier
open days have been organised at The Observatory in Peterborough to develop and
expand our range of relationships.
We continue to focus on certain vertical markets for our expansion, with motor
retailers, utilities, retail and industrial estates and facility management
companies all contributing to our sales growth.
Our e-Surveillance business moved forward in the first six months, with a
substantial new contract won from a major UK car retailer. We continue to run
trials in two of the UK's major food and beverage franchises, and have put in
place two new sales channels. We are working with SSP Limited in Scotland and
ICUK Technologies in Northern England to sell e-Surveillance CCTV security
systems, remotely monitored by Farsight plc utilising our suite of
e-Surveillance software. Further development of the software will take place
during 2003 with a further #450,000 scheduled to be invested over the next three
years and we continue to foster our relationships with product manufacturers,
Sony, Axis, JVC and more recently Panasonic on the Internet Protocol cameras and
devices used with our
e-Surveillance software.
I commend one of our clients, Newport City Council which won the prestigious,
'Security Client of the Year' award in 2002 from the industry's 'Security
Installer' magazine. Working in conjunction with the Gwent Police, Newport C.C.
formed the Newport Community Safety Partnerships and brought in Farsight and
Axis Communication. Together we constructed a fully-networked IP Surveillance
solution whereby vulnerable areas could be monitored across 20 different sites.
A dramatic reduction in vandalism has resulted, alongside significant cost
savings.
Farsight Technology
I outlined in previous statements the effect of the sharp and sudden downturn in
the IT consultancy market on the AIMS business. Market conditions continue to
deteriorate. Our largest customer, Abbey National Plc has conducted a cost
reduction exercise resulting in a disputed termination of our contract with
Abbey National Business. With no contracts and continued uncertainty in the
consultancy market, the Board passed a resolution to put AIMS into liquidation
on 27th February 2003. This decision will lead to a significant cost reduction
within Farsight plc, and allow the re-organisation of our technology support
services to be channelled in the future through a new division, Farsight
Technology headed up by Tom Blanchard.
Farsight Technology will supply technical support services to customers like
Chesterton Workplace Management and Cahoot Bank, and explore new areas of
activity like seeking telehousing opportunities whereby our BS5979 accredited
Peterborough facility can be used for data centre storage.
Funding
At the EGM on 11th October, all resolutions including those in relation to the
Placing and Open Offer of up to 150,000,000 new ordinary shares and the change
of name to Farsight plc, were approved by shareholders. As a result of this
exercise, #1.5 million was raised.
Board Changes
In July 2001, I became Chairman and Chief Executive of the Company, and
subsequently announced the appointment of our new Chief Executive
Mr Christopher Thomas in June 2002. I now intend to step down to the role of
non-executive Chairman.
Mr Colin Fisher has resigned from the Board as a non-executive director with
immediate effect. I would like to thank Colin for his personal support and
business professionalism.
The Board intends to appoint a further non-executive director in the coming
months.
During the period, Ms Carol Booth and Mr Andrew Bromley resigned from the Board
to pursue other interests.
Conclusion
The Company has undertaken a major re-organisation during the last six months,
raised #1.5 million and has taken forward both the Remote Video Monitoring
business and also successfully carried out trials of the new e-Surveillance
software, leading to operational success such as with Newport CC.
With our base cost reduced, rising revenues in our security business, new sales
channels opened up for e-Surveillance and a motivated management team, the Board
looks to the future with confidence.
We can now begin the process of rebuilding the Farsight business and we will be
looking for appropriate growth opportunities.
A T G Wix
Chairman
28th February 2003
Consolidated Profit and Loss Account
for the six months ended 30th November 2002
Unaudited Unaudited Audited
six months six months year to
to 30 Nov to 30 Nov to 31 May
2002 2001 2002
#000's #000's #000's
Turnover 597 1,649 2,712
Cost of sales (720) - (1,123)
Gross profit (123) 1,649 1,589
Net operating expenses (659) (2,351) (3,052)
Exceptional net operating expenses (196) (200) (1,978)
Total net operating expenses (855) (2,551) (5,030)
Operating loss (978) (902) (3,441)
Profit on sale of discontinued assets - - 141
Interest payable and similar charges (2) (27) (56)
Interest receivable 2 - 3
Loss on ordinary activities before taxation (978) (929) (3,353)
Taxation 50 - -
Loss on ordinary activities after taxation (928) (929) (3,353)
Loss for the financial period (928) (929) (3,353)
Loss per ordinary share (0.047p) (0.92p) (2.94p)
Fully diluted loss per ordinary share (0.047p) (0.92p) (2.94p)
Consolidated Balance Sheet
for the six months ended 30th November 2002
Unaudited Unaudited Audited
six months six months year to
to 30 Nov to 30 Nov 31 May
2002 2001 2002
#000's #000's #000's
Fixed assets
Intangible assets 2,200 5,255 2,348
Tangible assets 536 662 612
2,736 5,917 2,960
Current assets
Debtors 317 1,012 475
Cash at bank and in hand 491 - 2
808 1,012 477
Creditors: Amounts falling due within one year 1,420 1,770 1,716
Net current assets/(liabilities) (612) (758) (1,239)
Total assets less current liabilities 2,124 5,159 1,721
Creditors: Amounts falling due after one year (104) (320) (134)
Provisions for liabilities and charges (2) - (2)
Net assets 2,018 4,839 1,585
Capital and reserves
Share capital 7,402 5,483 5,902
Share premium account 4,496 5,587 4,635
Capital redemption reserve 20 - 20
Profit and loss account (deficit) (9,900) (6,231) (8,972)
Equity shareholder's funds 2,018 4,839 1,585
Notes to the Interim Report
Basis of preparation
The interim accounts were approved by the Board of Directors on 10 February
2003, and are neither audited nor reviewed by the auditors. They do not
constitute statutory accounts, but have been prepared on the basis of the
accounting policies set out in the annual report and accounts for the year ended
31 May 2002. Information in respect of the year ended 31 May 2002 is derived
from the Group's statutory accounts for the year ended 31 May 2002 which have
been delivered to the Registrar of Companies.
Earnings/(loss) per ordinary share
The calculation of basic loss per share is based on a loss of #927,000 (November
2001: loss of #929,817; May 2002: loss of #3,353,000) and a weighted average
number of shares of 197,477,072; (November 2001: 100,653,762; May 2002:
114,218,694).
This information is provided by RNS
The company news service from the London Stock Exchange
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