Final Results
June 14 2004 - 3:00AM
UK Regulatory
RNS Number:7054Z
Innovision Research&Technology PLC
14 June 2004
Innovision Research & Technology plc
Preliminary Results for the year ended 31 March 2004
Innovision Research & Technology, the RFID solutions provider, announces its
results for the year ended 31 March 2004.
Highlights
* Significant financial and commercial progress:
- Turnover increased to #2.2m from #800,000
- Losses after tax reduced to #1.2m (2003: #3.5m)
- #3.75m of cash balances at 31 March 2004
- Continued progress on all key commercial opportunities
* "Jewel"(TM) transport ticketing chip launched:
- Silicon being issued this month to customers for evaluation
- UK and International Standards compatible
- 3 licensees already in place
- 10 further potential licensees evaluating chip
* "io"(TM), the Worlds smallest RFID reader now in market testing:
- Telecoms trial underway
- Several volume manufacturing partners under consideration
- Innovision R&T well positioned for widespread adoption of
Near Field Communications ("NFC") Global Standard
* Increased visibility of future royalty streams - pre-production
silicon design underway on major consumer project.
Commenting on the results, Barton Clarke, CBE, Chairman said,
"I am pleased with the progress made during the past 12 months. With new market
leading products in both the transport and consumer sectors, we are increasingly
well placed to begin to reap the rewards of our hard work to date, whilst
continuing to develop the next generation of low cost RFID products and
applications."
14 June 2004
Enquiries:
Innovision Research & Technology plc Tel: 0118 936 6311
Mike Wroe, Finance Director
College Hill Tel: 020 7457 2020
Matthew Smallwood
CHAIRMAN'S STATEMENT
During the year to 31 March 2004, the Company has made good progress both
financially and commercially.
Turnover during the year increased to #2.2m against only #800,000 in the
previous year. This increase in sales combined with continued strong cost
control has reduced the loss after tax for the year to #1.2m from the #3.5m loss
in 2002/3 and ensured that at the year-end the Company retained cash balances of
#3.75m. Innovision R&T is well positioned within its core Radio Frequency
Identification (RFID) market place to take advantage of the increasing
opportunities in this sector and is now focusing on building revenues further,
particularly recurring royalty streams, and achieving a return to profitability.
Investment in research and development increased to #936,000 (2003: #854,000)
and I am extremely pleased that three years of hard work in developing an ultra
low-cost transport ticketing chip is now bearing fruit. This month will see the
delivery of the first chips to licensees and other potential customers for
evaluation. Launched in February this "Jewel"(TM) chip which is 30% smaller than
its nearest rival, is compatible with the international standard, ISO14443A, is
one of the only two low-cost products included in ITSO, the UK Standard, and is
similarly well positioned for inclusion in the US and European standards once
issued.
Licences with BemroseBooth (a subsidiary of Appleton Inc.), the UK's leading
ticket manufacturer, Giesecke & Devrient America, a major US ticket converter
and KSW Microtec, Europe's leading label technology specialist, are already in
place. Ten potential licensees, representing approximately 60% plus of the
ticket converter market, are also evaluating the chip and key equipment
manufacturers are already updating their gate readers to accept Jewel. We
therefore believe the Company is extremely well placed to deliver significant
royalties in 2005 and beyond from a market estimated to be 8-10 billion units
per annum* within five years. We expect to report further progress in this area
in due course.
Within both the consumer and medical sectors the Company has continued to
develop its profile, product offering and customer base. Fifteen months of
funded engineering work on the design of a new product line for one of Europe's
leading consumer products businesses continues and the design of the
pre-production chip is now underway, the first phase of which represents over
Euro500,000 of work for the Company in 2004. Although this product remains at
least 12 months from manufacture, the customer commitment and potential scale of
this opportunity alone justifies our optimism for the future.
Elsewhere in the consumer sector we have completed the funded development of "io
"(TM), the world's smallest RFID reader module. Initial market trials of the
reader in the telecoms sector are already underway and we are in active
discussions with a number of major silicon houses as to the best route to
exploit the current design in large volumes. The "io"(TM) development programme
has positioned Innovision R&T at the forefront of both reader and application
design for the rapidly developing Near Field Communication ("NFC") standard #.
"NFC" is being sponsored by the major consumer electronics and telecoms
manufacturers and has the potential to drive the large-scale, rapid adoption of
13.56MHz RFID. The Company has relevant IP blocks already in live products, a
strong transport ticketing presence and an estimated time-to-market advantage of
well over a year. As such Innovision R&T is in a strong position to take
advantage of this opportunity.
The combination of Innovision R&T's ultra low cost reader and tag designs, and
its wider system skills, have enabled customers to incorporate RFID into their
products where cost would otherwise have proved prohibitive. Two such examples
are the UK leisure operator now franchising its RFID golf concept worldwide, and
Colder Products Corporation, the leading manufacturer of vending machine
couplings, who are using Innovision R&T's low cost RFID systems to add further
safety, security and functionality to their product range.
The progress made over the past year reflects the expertise, dedication and hard
work of everyone in the Company and I thank them for continuing to rise to the
challenges presented to us by our customers. Sadly, after four years as a
Non-Executive Director, Ken Taylor will not be seeking re-election at the next
AGM. Ken has helped guide the Company through the many challenges of the past
few years, in particular our flotation in 2001 and his valuable input will be
missed in Board meetings. We wish him well and with the search for his
replacement now well under way, I look forward to announcing the new appointment
in the near future.
In summary, I am pleased with the progress made during the past 12 months.
Although contract wins targeted for the first 2 months of the new financial year
are taking longer to close than anticipated, we are close to a number of major
opportunities. With new market leading products in both the transport and
consumer sectors, we are increasingly well placed to begin to reap the rewards
of our hard work to date, whilst continuing to develop the next generation of
low cost RFID products and applications.
Barton Clarke CBE
14 June 2004
* As stated by Philips at UITP - Milan - Feb 2004
# See www.nfc-forum.org
PROFIT AND LOSS ACCOUNT
for the year ended 31 March 2004
Notes 2004 2003
#'000 #'000
Turnover 3 2,212 802
Cost of sales (382) (169)
Gross profit 1,830 633
Administrative expenses
Normal operating (3,284) (4,023)
Exceptional items - (423)
Operating loss (1,454) (3,813)
Amounts written off investments (14) -
Interest receivable 146 244
Loss on ordinary activities before taxation (1,322) (3,569)
Taxation 4 122 120
Retained loss for the year (1,200) (3,449)
Loss per share 5 Pence per Pence per
share share
Basic (3.03) (8.72)
Diluted (3.03) (8.72)
The operating loss for the year arises from the Company's continuing operations.
No separate Statement of Total Recognised Gains and Losses has been presented as
all such gains and losses have been dealt with in the Profit and Loss Account.
BALANCE SHEET
31 March 2004
2004 2003
#'000 #'000
Fixed assets
Tangible assets 309 331
Investments - 14
309 345
Current assets
Stocks 52 -
Debtors 1,114 780
Cash at bank and in hand 3,750 4,532
4,916 5,312
Creditors: Amounts falling due within one year (1,028) (480)
Net current assets 3,888 4,832
Net assets 4,197 5,177
Capital and reserves
Called up share capital 400 395
Share premium 10,049 9,834
Profit and loss account (6,252) (5,052)
Equity shareholders' funds 4,197 5,177
CASH FLOW STATEMENT
for the year ended 31 March 2004
2004 2003
Notes #'000 #'000
Net cash outflow from operating activities 6A (1,166) (3,204)
Returns on investments and servicing of finance
Interest received 161 390
Taxation 122 155
Capital expenditure and financial investment
Purchase of tangible fixed assets (149) (131)
Sale of tangible fixed assets 30 26
Net cash flow for capital expenditure and financial investment (119) (105)
Cash outflow before use of liquid resources and financing (1,002) (2,764)
Management of liquid resources
Decrease in treasury deposit account 1,553 2,580
Financing
Proceeds from share issue 220 -
Increase / (decrease) in cash in year 771 (184)
Reconciliation of net cash flow to movement in net funds
Increase / (decrease) in cash in year 771 (184)
Cash outflow from decrease in liquid resources (1553) (2,580)
Change in net funds resulting from cashflow (782) (2,764)
Opening net funds 4,532 7,296
Closing net funds 6B 3,750 4,532
NOTES
for the year ended 31 March 2004
1. The financial information contained in this document does not
constitute statutory accounts within the meaning of section 240 of the Companies
Act 1985. The figures for the year ended 31 March 2003 and 2004 have been
extracted from the annual accounts on which the auditors have issued unqualified
reports which did not contain statements under section 237 (2) or (3) Companies
Act 1985. Statutory accounts for the year to 31 March 2003 have been filed with
the Registrar of Companies. The audited statutory accounts for the year ended
31 March 2004 will be delivered to the Registrar of Companies and shareholders
in due course.
2. The Directors do not recommend the payment of a dividend.
3. Accounting Policies
Other than as stated below, all accounting policies adopted are consistent with
those applied in prior years.
Turnover
Turnover represents income earned for the accounting period in accordance with
the principles set out below, exclusive of Value Added Tax.
Development fees earned from customers are recognised as income in the period
during which the development work is carried out. Licence fees are recognised
as income over the period during which the Company is obliged to provide
services to the customer pursuant to the terms of the license.
Non-refundable advance royalties and guaranteed royalties are recognised as
income when the Company is contractually entitled to the relevant amounts and
has no further obligations to provide services in respect of such royalties.
This represents a change in accounting policy as a result of the publication in
November 2003 of "Amendment to FRS5 "Reporting the substance of transactions":
Revenue recognition". Previously non-refundable advance royalties were
recognised as income as a customer achieved product sales and guaranteed royalty
amounts were recognised as income of the guarantee period. The impact of the
adoption of this new policy has been to increase the amount of income recognised
in the year ended 31 March 2004 by #82,000; the amount of income reported in
respect of the comparative period does not change.
4. Taxation
2004 2003
#'000 #'000
Based on the profit for the year:
Research & development tax credit (120) (120)
Under provided in previous years (2) -
(122) (120)
Deferred taxation - -
(122) (120)
5. Loss per share
Basic loss per share has been calculated by dividing the loss for the year of #1,200,000 (2003:
#3,449,000) by the weighted average number of shares in issue during the year of 39,623,312 (2003:
39,554,390).
There is no dilution in the loss per share as a result of outstanding options.
6. Notes to the Cashflow Statement
2004 2003
#'000 #'000
A Reconciliation of operating loss to net cash outflow
from operating activities
Operating loss (1,454) (3,813)
Depreciation 149 284
(Profit) / loss on sale of fixed assets (8) 1
Increase in stocks (52) -
(Increase) / decrease in debtors (349) 214
Increase in creditors 548 110
Net cash outflow from operating activities (1,166) (3,204)
At 1 April 2003 At 31 March 2004
#'000 Cash flows #'000
#'000
B Analysis of changes in net funds
Other cash at bank and in hand (11) 771 760
Short term bank deposits 4,543 (1,553) 2990
4,532 (782) 3,750
7. This statement was approved by the Board of Directors on 14th June
2004.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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