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RNS Number : 8177H
Panoply Holdings PLC (The)
05 August 2019
5 August 2019
The Panoply Holdings PLC
("The Panoply", or the "Group")
Preliminary results for the year ended 31 March 2019
Maiden results demonstrate success of model, philosophy and
market opportunity
The Panoply (AIM: TPX), a digitally native technology-enabled
services company, is pleased to announce its unaudited results for
the year ended 31 March 2019.
Pro Forma Financial highlights(1)
-- Revenue up 42% to GBP22.1m (FY2018: GBP15.6m)
* 38% organic growth (based on the original four
companies acquired at IPO), 4% growth as a result of
acquisitions made post-IPO
-- Adjusted EBITDA(2) up 30%, ahead of market expectations,
to GBP3.5m (FY2018: GBP2.7m) representing an Adjusted
EBITDA margin of 16% (FY2018: 17%).
-- Adjusted EBITDA(2) excluding central costs up 37% to
GBP4.4m (FY2018: GBP3.0m), representing an Adjusted
EBITDA excluding central costs margin of 20% (FY2018:
19%)
Statutory financial highlights(3)
-- Revenue of GBP8.2m (FY2018: GBP0m)
-- Adjusted EBITDA(2) of GBP0.4m (FY2018: loss GBP0.3m)
-- Operating loss of GBP1.6m (FY2018: loss GBP0.5m)
-- Loss for the period of GBP1.7m (FY2018: GBP0.5m)
-- Cash at bank at year end of GBP5.7m, ahead of expectations
(2018: GBP0.1m)
Pro Forma operational highlights
-- 191 customers billed in the year (162 customers billed
in the 12 months to 31 March 2018)(4)
-- Growing number of long-term customer relationships, providing
increased visibility for the Group with 45% of customers
billed in the year to 31 March 2017 and 68% of customers
billed in 2018 also billed in 2019(4)
-- Particularly strong growth in the public sector, which
accounted for 33% of total revenue in the period, and
following the post-period acquisition of FutureGov is
expected to rise further.
Transactions
-- IPO and an oversubscribed fundraise in December 2018,
raising GBP5m in new equity for the Group
-- Acquisitions of Manifesto Digital Limited, Not Binary
Limited, Questers Global Group Limited and Bene Agere
Norden AS at IPO in December 2018
-- Acquisition of Deeson Group Holdings Limited in December
2018
-- Acquisition of iDisrupted Ltd (D/SRUPTION) in January
2019
-- Acquisition of GreenShoot Labs Limited in February 2019
-- Launch of human+, subsidiary of TPX Notbinary in February
2019
Post-period highlights
-- Acquisition of FutureGov Limited in June 2019
-- Entered into a three year GBP5m revolving credit facility
with HSBC in June 2019
Neal Gandhi, Chief Executive Officer, commented:
"I am very pleased to be reporting our first year end results as
a public company, delivered ahead of our expectation at the time of
our IPO in December 2018. Since we joined the market, our existing
businesses have experienced strong continued growth and in the
period we successfully completed a further three acquisitions,
bringing two leading companies in key technologies, and D/SRUPTION
into the Group. We also launched human+, enabling The Panoply Group
to deliver robotic process automation to our clients.
Post-period, we completed our eighth and largest acquisition to
date with the purchase of FutureGov. The Panoply now operates as a
very strong disrupter to the large IT services incumbents in the
public and health sectors, and we are excited to be driving forward
the Group's development in this field.
We are very excited by the opportunity ahead, particularly as we
begin to combine our offerings into specific vertical markets. We
are beginning to reach critical mass in the public sector, health
and not for profit sectors and at the same time are beginning to
win substantially larger commercial sector clients. All of this
bodes well for continued organic growth across the Group. At the
same time, we continue to focus on M&A that strengthens our
business. As a result of both strategies running in parallel, we
are confident that the Group will be able to sustain momentum over
the year and achieve market expectations for FY2020."
(1) All figures are reported proforma and on a similar basis as
in Panoply's recent Admission Document on the assumption that
Manifesto Digital Limited, Not Binary Limited, Questers Global
Group Limited and Bene Agere Norden AS were owned for the full
period and Deeson Group Holdings Limited, iDisrupted Ltd and
Greenshoot Labs from the date of acquisition. The information was
prepared in this way in order to provide investors with a clearer
picture of the performance of the entities on a combined basis.
(2) Adjusted EBITDA is a non-IFRS measure that the Company uses
to measure its performance and is defined as earnings before
interest, taxation, depreciation and amortisation and after add
back of exceptional items related to the IPO and acquisitions made
by the Group, share based payments and fair value movements
(3) The Statutory accounts reflect the revenue and profits of
the subsidiaries from the date of acquisition rather than on a pro
forma basis
(4) Based on all companies acquired during the year
Enquiries:
The Panoply Holdings via Alma PR
Neal Gandhi (CEO)
Oliver Rigby (CFO)
Stifel Nicolaus Europe Limited (Nomad
and Broker) +44 (0)207 710 7600
Fred Walsh/ Alex Price/ Neil Shah/
Luisa Orsini Baroni
Alma PR (Financial PR) +44 (0)20 3405 0206
Josh Royston/ Susie Hudson/ Kieran
Breheny 07780 901979
About The Panoply
The Panoply is a digitally native technology-enabled services
company, built to service clients' digital transformation needs.
Founded in 2016, with the aim of identifying and acquiring
best-of-breed specialist information technology, design and
innovation consulting businesses across Europe, the Group
collaborates with its clients to deliver the technology outcomes
they're looking for at the pace that they expect and demand.
www.thepanoply.com
Chairman's statement
I am delighted to be reporting on an eventful and successful
year for The Panoply, with the team having reached a number of
milestones in just twelve short months. Most seminal of those was
our successful IPO in December 2018, which saw The Panoply take
shape, and our four initial Group companies acquired.
Following the IPO, strong momentum has been maintained with four
further key events taking place in the period, including the
acquisition of a leading digital agency and an artificial
intelligence business, the launch of human+, an early stage
investment into the high growth area of robotic process automation,
and the acquisition of D/SRUPTION. Post-period a further,
transformational deal was completed with the purchase of FutureGov,
which opens up additional opportunities for all of our Group
companies and means that The Panoply now offers an end-to-end
solution to public sector and health clients as an alternative to
the big systems integrators.
Alongside the growth of the UK cluster, The Panoply's central
offering has been significantly developed over the period, with the
M&A team strengthened and our Group marketing platform created
through the acquisition and progression of D/SRUPTION.
It has been a particularly exciting period for those of us who
have been with The Panoply since inception, seeing the team grow
from a group of just three individuals with an ambitious vision to
change the digital service consultancy model, to a Group which, as
at 30 June 2019, now employs over 300 people and is at work
delivering value for end clients every day.
Corporate governance
Despite having been incorporated less than three years ago, The
Panoply Board has committed to a corporate governance approach
commensurate with more mature businesses and has applied the
principles set out in the QCA code to the Group.
Alongside our central governance function, a non-executive
director is appointed by the Board to the board of each Panoply
Group Company to provide governance support. All new acquisitions
go through a 100 day integration plan which covers areas such as
back office finance functions and KPI reporting. This is designed
to provide the central Group with the ability to impose robust
standards on all Group companies.
As an early-stage business, it is a priority to keep all our
shareholders up-to-date and engaged. The IPO attracted investment
from both private and institutional investors. We appreciate that
they share our longer-term ambition and we are committed to
transparency in all our corporate communications.
People
The different companies' teams working under The Panoply
umbrella are connected by shared values; they strive to be
entrepreneurial, creative, ego-free and conscious in all that they
do. Alongside this we have a management team who have clearly shown
their dedication, ambition and skill in their execution of these
encouraging results.
Purpose
Since inception, we have made it clear that The Panoply is a
purpose driven Group that wants to leave the world a better place
than it found it.
This represents a key differentiating factor for our staff, and
the businesses which choose to work with us. Over the last few
months our focus has been on identifying exactly how we can make
the maximum positive impact possible, in a way which benefits all
our stakeholders and the wider community.
We are in the business of innovation, but we understand that
change is not always good for everyone. Therefore, we are committed
to building sustainable futures. By collaborating with clients,
colleagues and communities to drive positive change, we help them
to thrive tomorrow and beyond.
The Group's Sustainable Futures work is divided between four
primary focus areas: helping communities to thrive in a digital
future, making the tech industry fair and accessible, putting
employee wellbeing first and minimising our environmental impact.
In order to hold itself accountable, The Panoply is publishing
targets in each of these areas and progress against those targets
each year in the annual report.
Outlook
The Group has made huge strides in a very short space of time to
create a business that can address the evolving needs of its
customers, whilst serving a clear purpose and delivering tangible
benefits to all stakeholders.
The current year has started well, and we are confident in
meeting our full year ambitions. With the investments made in new
service areas not expected to deliver returns until later in the
year and taking into consideration the enlarged central cost base
of the Company following IPO, we would expect profitability for the
year to be largely second half weighted.
We continue to have a strong pipeline of potential acquisitions
and as our success builds, believe we will become an increasingly
attractive home for well run, entrepreneurial businesses keen to
displace the incumbent model in the market.
Chief Executive's review
I am very pleased to be reporting our first full year results,
delivered ahead of our expectations set at the time of our IPO in
December 2018.
Having listed with just under four months remaining in our
financial year, it was at this point that we could begin in earnest
the execution of our growth strategy through the pursuit of
complementary acquisitions and cultivation of collaboration between
Group companies. We made considerable progress in both these areas,
with seven acquisitions successfully completed, including the
initial four on IPO, and multiple collaborations seen across Group
companies.
At an operational level, we have begun the bedding in of our
differentiated, 21(st) century operating model and building a
central team capable of overseeing further growth.
The level of market demand for The Panoply's services is
continuing to grow at pace as we extend the capabilities and reach
of the Group. The opportunities available are larger in scale than
expected at inception and we will be focused on delivering against
this growing opportunity in the year ahead.
Admission to AIM
Our IPO led to the formation of The Panoply and gives us the
financial strength and stability to grow our business. This
stability gives clients the confidence to trust us with ever more
strategic and high value engagements. It provides us with the
necessary working capital to invest in each of our business units,
as well as providing an equity base to achieve our acquisition
ambitions.
Growth strategy
The Panoply Group's strategy comprises of two primary elements:
to acquire best-in-class technology service businesses in order to
build regional clusters of complementary companies which together
offer the full suite of digital transformation services; and to
help those acquired companies to achieve accelerated organic growth
through cross selling, upselling and creating joint propositions,
as well as investing in new growth opportunities where there is a
clear demand.
The Group is targeting the acquisition of companies providing
certain services in key emerging technologies. It aims to acquire
businesses that buy into the values of the group and provide one or
more of the below:
-- additional capability
-- entry to new sectors
-- scale
The Group also invests into new teams, new practices, and
supports either internal or external startups where there is clear
demand. At the heart of our strategy is the Group's acquisition
formula, which is designed to attract ambitious companies,
confident in their ability to grow profitably.
We support acquired companies to achieve enhanced long-term
organic growth through access to listed status, cross-selling
opportunities, enhanced marketing and an improved ability to
attract talent.
Overview of performance
The year to March 2019 relates to a time period both before and
after we became a public company. On a pro forma basis the Group
has delivered combined revenue growth for the year of GBP22.1m, an
increase of 42% over the corresponding period last year. Pro forma
adjusted EBITDA also saw strong growth, increasing 30%.
This growth was driven by an increase in customer numbers across
our constituent companies, up 18% to 191 again on a pro forma
basis. Notable customers include DVLA, Ministry for Housing,
Communities and Local Government, News UK and the National
Trust.
The Group saw particularly strong growth from the
not-for-profit, health and public sectors. This increase was mostly
organic, driven by the strong presence Group companies have in
these markets. Following The Panoply's post-period acquisition of
FutureGov, we expect circa 45% of Group revenue, on a proforma
basis, to originate from the health and public sectors. With Public
suggesting the UK GovTech market could be worth GBP20 billion by
2025 (Unlocking the Potential of Startups to solve public problems,
Public.io report 2017), the Group is excited about its ability to
offer a truly differentiated proposition to the incumbent larger
systems integrators in this industry and grow market share.
As a breakdown of services, the greatest proportion of Group
revenue currently originates from the provision of Experience, XaaS
and Transformation services (26%, 27% and 36% respectively).
Intelligence and Automation, whilst currently a smaller proportion
of the Group's business, are significant potential growth areas
with large client opportunities in the pipeline.
In the period we launched human+, a robotic process automation
business that believes success is achieved through enabling and
re-training the people central to its adoption. human+ has worked
closely with Blue Prism and Thoughtonomy (which was recently
acquired by Blue Prism). The primary focus for human+ is the public
and health sectors with post-period contract wins including UCL and
NHS Wales.
Performance against growth strategy: Acquisitions
Following Admission to trading on AIM on 4 December 2018 and the
resulting completion of our target acquisitions, alongside the
completion of three subsequent acquisitions during the year, the
launch of human+ as a subsidiary of Notbinary, and the post-period
acquisition of FutureGov, the Group now comprises:
-- Bene Agere: an Oslo-based strategy and management consultancy;
-- Manifesto Digital: an award-winning London-based digital
experience agency;
-- Deeson: A leading digital agency based in Canterbury
and London;
-- Notbinary: an award-winning London-based IT consultancy
focused on digital transformation;
* human+: a specialist robotic process automation
business and subsidiary of Notbinary
-- Questers: an award-winning provider of onshore and nearshore
agile software development services, headquartered in
Sofia, Bulgaria;
-- Greenshoot Labs: a provider of enterprise digital solutions
using applied AI and conversational interfaces, based
in London; and
-- FutureGov: a leader in digital service design for the
public sector and health sector, based in London.
All acquisitions were completed in line with the Group's
strategy and have added either entry into new sectors with growing
market opportunity, such as conversational interfaces, or
additional scale. All management teams have demonstrated their
commitment to The Panoply's values and ethos. All are subject to
the acquisition formula.
Also acquired in the period was D/SRUPTION, a digital
transformation community, focused around a magazine, newsletter,
research papers and events, in order to provide a marketing
platform for The Panoply's Group companies. The D/SRUPTION's
flagship event, the European summit, is scheduled for September
2019 and will see The Panoply leading a dedicated track focused on
the public sector and health as well as a workshop targeted at not
for profits. Combined with whitepapers, round table dinners and
advertisements, D/SRUPTION has already demonstrated that it has the
capacity to provide a more powerful marketing umbrella for our
Group companies than they would be able to create for
themselves.
Our Group company, Greenshoot Labs, has released OpenDialog, an
open source conversational management framework focused
particularly on regulated industries in public sector, health, not
for profits and the commercial sector, particularly financial
services. Post period contract wins for Greenshoot Labs include the
Defence Science and Technology Laboratory and global audit firm
BDO.
We are particularly excited about the post period acquisition of
FutureGov. Over more than a decade FutureGov has built an enviable
reputation for the delivery of scaled digital transformation and
organisational change across government organisations, saving money
and improving outcomes for citizens at local and national level
across health and public services. Digital transformation in the
public sector follows a defined process from Discovery, where the
suitability and need for a new service is assessed, through to
Alpha where a proof of concept is created, then to Beta where a
scaled full version is delivered and then to Live. Historically,
FutureGov has had a reputation for Discovery and Alpha phases,
typically ending their engagements there or partnering with third
party organisations for the Beta and Live phases. On the other
hand, NotBinary has typically succeeded in winning engagements from
the Alpha phase onwards. By combining the sales efforts of the two,
we now have an end to end proposition that is a credible
alternative to the large systems integrators, and we will look to
further develop this into single holistic offering where
appropriate this deal is a game changer that cements our public
sector and health and we are hopeful that it leads to considerable
future success.
Performance against growth strategy: The Panoply multiplier
effect
Whilst the businesses under The Panoply umbrella have been
working in tandem and with the ethos of The Panoply for a limited
period, and for some only a number of weeks, we are already
beginning to see signs of success from their collaborative
efforts.
Since IPO the Group has won numerous new collaborative projects,
including work with Food Standards Agency, Cancer Research UK and
Young Epilepsy along with Norway based BBL Digital.
Outlook
The board and I are delighted with the progress the team has
made since listing and believe these maiden results have begun to
demonstrate the success of our model, philosophy and the strength
of the market opportunity.
Based on these strong results and the opportunities we see ahead
of us, we made the decision to invest further in our new service
lines, particularly in the fast growing areas of robotic process
automation, applied artificial intelligence and conversational
interfaces, with an emphasis on regulated industries.
These investments, together with the cost of now being a listed
company, will impact the Group's EBITDA in the first half of the
year, leaving it lower than the pro forma interim results announced
in December 2018. However, the strong ongoing performance of the
Group businesses, contracts won post period end and the growing
pipeline of opportunity underpins the Board's confidence in
achieving market expectations for the year as a whole. In line with
the Board's confidence for the second half FY20, the Company makes
no changes to its full year guidance and in line with our Admission
Document reiterate our intention to pay a dividend following the
conclusion of the results for the financial year ended 31 March
2020.
We are excited about the year ahead and to continue delivering
on our vision to build a 21(st) Century provider to solve our
clients' 21(st) Century problems. The digital transformation
journey for many organisations remains at the earliest stages and
we are increasingly well placed to help clients on those journeys,
and as a result deliver over the year and continue to create value
for all our stakeholders.
Neal Gandhi
Chief Executive Officer
Financial review
In our Admission document we reported financial information on a
pro forma basis. This showed the results of the Group as if The
Panoply had owned Manifesto Digital Limited, Not Binary Limited,
Questers Global Group Limited and Bene Agere Norden AS throughout
the reported periods. The information was prepared in this way in
order to provide investors with a clearer picture of the
performance of the entities on a combined basis.
These maiden full year results have been prepared on a statutory
basis. As such they only reflect the revenue and profits of the
entities above since the date of acquisition on 4 December 2018 as
well as including the results of Deeson Group Holdings Limited,
iDisrupted Ltd and Greenshoot Labs Limited from the date of
acquisition.
In order to compare the results of the Group with the Admission
document and our interim results, we have also prepared certain pro
forma information for the year to 31 March 2019. The pro forma
numbers are prepared on a similar basis to those numbers included
in the Admission Document, on the assumption that Manifesto Digital
Limited, Not Binary Limited, Questers Global Group Limited and Bene
Agere Norden AS were owned for the full period and Deeson Group
Holdings Limited, iDisrupted Ltd and Greenshoot Labs Limited from
the date of acquisition.
Statutory results
Statutory revenue for the year was GBP8.2m reflecting the
initial acquisitions completing on 4 December 2018 and the three
subsequent acquisitions completing prior to 31 March 2019. Adjusted
EBITDA prior to exceptional items was GBP0.4m and the loss after
tax was GBP1.7m.
Negative operating cash flows of GBP0.9m are a reflection of the
exceptional costs relating to the acquisitions and the IPO
totalling GBP1.4m. There were other significant cash movements
during the period including the GBP5m placing completed in December
2018, GBP7.0m taken over from subsidiaries acquired in the year as
well as GBP5.6m cash paid out as part of the acquisitions to
vendors.
The Group's cash position was strong at the end of the period
with GBP5.7m on balance sheet reflecting the oversubscribed placing
at the IPO which raised gross proceeds of GBP5m. Post year-end we
completed the acquisition of FutureGov which included the payment
of consideration including cash and ordinary shares. In order to
help fund the acquisition The Panoply entered into a three year
GBP5m revolving credit facility with HSBC (the "RCF Facility")
pursuant to which GBP3.55m was drawn-down to pay a proportion of
the cash consideration. The undrawn facility is available to use
for further acquisitions or working capital.
As at 31 May 2019, assuming all payments in connection with the
acquisition of FutureGov had been made as at that date, the Group
retained cash reserves of approximately GBP4.75m.
Pro forma results
The following table shows the results of the Group on a pro
forma basis and reconciliation back to the statutory numbers.
Pro forma financial information Unaudited Unaudited Unaudited Unaudited
Mar-19 April-18 to Mar-19 Mar-18
Nov-18
Statutory Pre-acquisition pro forma pro forma
accounts results* FY12m FY12m
GBP'000 GBP'000 GBP'000 GBP'000
--------------------------------- -------------- ---------------------- ------------------ ------------------
Revenue 8,152 13,910 22,062(**) 15,564
Cost of sales (4,811) (8,169) (12,980) (9,955)
--------------------------------- -------------- ---------------------- ------------------ ------------------
Gross profit 3,341 5,741 9,082 5,609
--------------------------------- -------------- ---------------------- ------------------ ------------------
Administrative expenses (1,989) (2,852) (4,841) (2,731)
Central costs (974) - (974) (273)
Other income 24 173 197 93
--------------------------------- -------------- ---------------------- ------------------ ------------------
Adjusted EBITDA 402 3,062 3,464 (**) 2,698
--------------------------------- -------------- ---------------------- ------------------ ------------------
* This shows the unaudited results for the four subsidiaries
acquired at IPO from 1 April 2018 to 4 December 2018.
** Revenue of GBP621,000 and an Adjusted EBITDA loss of
GBP89,000 relate to Deeson Group Holding Limited, iDisrupted Ltd
and Greenshoot Labs. This reflects the results of these businesses
between acquisition and 31 March 2019.
On a pro forma basis the Group has seen significant growth in
both revenue and EBITDA during the year. Revenue has increased by
42% from GBP22.1m to GBP15.6m. 4% of this growth related to the
three acquisitions completed after the IPO with the remaining 38%
being organic growth. Adjusted EBITDA has increased from GBP2.7m to
GBP3.5m.
This growth has been driven largely by our established
businesses operating across the Experience, and Transformation
service lines. We have made investment into the Automation and
Intelligence service lines with the incorporation of human+ and
through the acquisition of Greenshoot Labs in the latter part of
the financial period. As a result, we expect these lines to grow in
the coming year.
We also monitor revenue across Commercial, NGO and Government
and we have seen significant growth in our government sector
business, which accounted for 33% (2018: 13%) of pro forma revenue
in the year. We expect this to increase further following the
acquisition of FutureGov in June 2019.
Whilst we have seen a rise in EBITDA margins (excluding central
costs) from 19% to 20% in the current year, including central costs
the EBITDA margin has fallen from 17% to 16%. Central costs were
GBP0.97m in the period. In FY2020 the Group will see this rise with
the impact of a full year of an enlarged cost base, a reflection of
the key recruitment completed after IPO, as well as the associated
costs of being an AIM quoted company. Going forward, it is not
anticipated that significant increases to the cost base are needed
in order to scale.
We expect to see a reduction in EBITDA margin in the first half
of the current year as a result of the additional central costs and
investments made into new service lines as set out above.
Because of the 15 month period reported in the Admission
Document, this year it has been difficult to show certain
information on a like for like basis. In following periods we
intend to show full details of revenue split by services and
sector.
Additional consideration
As a result of the strong trading during the period and growth
in three of the four businesses acquired at IPO, a total of
GBP10.9m is payable as earn out consideration in ordinary shares in
the Group. These shares are to be issued at the higher of 74p
(being our price at IPO) and the prevailing share price at the time
of issue. The maximum total number of shares to be issued therefore
in respect of results during the period is 14,665,516 which reduces
to 11,130,751 based on the closing share price on the day prior to
this announcement. The ordinary share consideration is payable over
the next twenty-four months subject to certain performance targets
being met. At present these targets have not been met and as a
result the consideration payments have not yet been made.
The earn out period on the initial four acquisitions runs until
the results to 31 March 2020 and we therefore expect further
adjustments subject to performance during the current year.
Oliver Rigby
Chief Financial Officer
Consolidated income statement Unaudited Audited
2019 2018
as at 31 March 2019 Note GBP'000 GBP'000
------------------------------------------------- ----- ------------- ---------------
Revenue 3 8,152 -
Cost of sales (4,811) -
------------------------------------------------- ----- ------------- ---------------
Gross profit 3,341 -
------------------------------------------------- ----- ------------- ---------------
Administrative expenses (4,992) (480)
Other income 24
------------- ---------------
Operating (loss) (1,627) (480)
------------------------------------------------- ----- ------------- ---------------
Adjusted EBITDA 3 402 (273)
Amortisation of intangible assets (339) -
Depreciation (45) -
(Loss)/gain on fair value movement contingent (54) -
consideration
Share-based payments (239) -
Exceptional items - costs directly attributable
to the business combination (1,352) (207)
------------------------------------------------- ----- ------------- ---------------
Operating (loss) (1,627) (480)
------------------------------------------------- ----- ------------- ---------------
Finance income 5 -
Finance costs (14) -
------------------------------------------------- ----- ------------- ---------------
Net finance expense (9) -
------------------------------------------------- ----- ------------- ---------------
Loss before taxation (1,636) (480)
------------------------------------------------- ----- ------------- ---------------
Taxation (41) -
------------------------------------------------- -----
Loss for the year (1,677) (480)
------------------------------------------------- ----- ------------- ---------------
Other comprehensive income
Exchange differences on translation of foreign (38) -
operations
------------------------------------------------- ----- ------------- ---------------
Total comprehensive income for the period (1,715) (480)
------------------------------------------------- ----- ------------- ---------------
Loss per share
(9.22) (4.57)
Basic and fully diluted 4 p p
------------------------------------------------- ----- ------------- ---------------
Consolidated statement of financial Unaudited Audited
position 31 March 31 March
as at 31 March 2019
--------------------------------------
2019 2018
Note GBP'000 GBP'000
-------------------------------------- ------- --------- ---------
Non-current assets
Goodwill 20,585 -
Intangible assets 5,214 -
Property, plant and equipment 280 -
Deferred tax assets 14
----------------------------------------------- --------- ---------
Total non-current assets 26,093 -
----------------------------------------------- --------- ---------
Current assets
Trade and other receivables 3,918 7
Contract assets 232 -
Other taxes - 34
Cash and cash equivalents 5,650 126
----------------------------------------------- --------- ---------
Total current assets 9,800 167
----------------------------------------------- --------- ---------
Total assets 35,893 167
----------------------------------------------- --------- ---------
Current liabilities
Trade and other payables (2,210) (154)
Other taxes and social security costs (1,539) (3)
Contingent consideration (3,270)
Contract liability (406) -
Total current liabilities (7,425) (157)
----------------------------------------------- --------- ---------
Non-current liabilities
Deferred tax liability (925) -
Contingent consideration (8,292) -
----------------------------------------------- --------- ---------
Total non-current liabilities (9,217) -
----------------------------------------------- --------- ---------
Total liabilities (16,642) (157)
----------------------------------------------- --------- ---------
Net assets 19,251 10
----------------------------------------------- --------- ---------
Equity
Share capital 423 -
Share premium account 20,779 490
Capital redemption reserve 5 -
Other reserve 201 -
Retained earnings (2,157) (480)
----------------------------------------------- --------- ---------
Total equity 19,251 10
----------------------------------------------- --------- ---------
Consolidated Capital
statement Share Share redemption Foreign Share Retained Total
of changes in capital premium reserve Exchange option earnings
equity reserve reserve
for the year
ended 31
March
2019
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------------- ------------ --------------- ----------- ----------- ------------ -------
At 1 April 2017 - - - - - - -
(Audited)
Loss and total
comprehensive
loss for the
period - - - - - (480) (480)
Transactions
with owners
Share issued - 500 - - - - 500
Share issue
costs - (10) - - - - (10)
--------------- -------------------- ------------ --------------- ----------- ----------- ------------ -------
Equity at 31
March 2018
(Audited) - 490 - - - (480) 10
Share Share Capital Foreign Share Retained Total
capital premium Redemption exchange Option earnings
reserves Reserves
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------- ------- ----------- ------------ --------------- ----------- ----------- ------------ -------
At 1 April 2018
(Audited) - 490 - - - (480) 10
Loss and total
comprehensive
loss for the
period - - - - - (1,677) (1,677)
Forex
differences - - - (38) - - (38)
Transactions
with owners
Share
cancellation (5) - 5 - - - -
Share issued 428 20,543 - - - - 20,971
Share issue
costs - (254) - - - - (254)
Share-based
payments - - - - 239 - 239
--------------- ------- ----------- ------------ --------------- ----------- ----------- ---------------------
Equity at 31
March 2019
(unaudited) 423 20,779 5 (38) 239 (2,157) 19,251
--------------- ------- ----------- ------------ --------------- ----------- ----------- ---------------------
Consolidated statement of cash flows Unaudited Audited
for the year ended 31 March 2019 2019 2018
GBP'000 GBP'000
--------------------------------------------------- --------- -----------------
Cash flows from operating activities
Loss before taxation (1,636) (480)
Adjustments for:
Depreciation 45 -
Amortisation 339 -
Share-based payments 239 -
Loss on disposal of property, plant and equipment 2 -
Foreign exchange losses/(gains) 7 -
Net finance expense 9 -
Movement in fair value contingent consideration 54 -
(941) (480)
Working capital adjustments:
Decrease/(Increase) in trade and other receivables 384 (41)
(Decrease)/Increase in trade payables, accruals
and contract liability (650) 157
--------------------------------------------------- --------- -----------------
Cash (consumed by)/ generated from operations (1,207) (373)
--------------------------------------------------- --------- -----------------
Tax received / (paid) 27 -
Cash flows from investing activities
Acquisition of subsidiaries (paid) (5,613) -
Acquisition of subsidiary - cash inherited
from acquisition 6,978 -
Purchase of property, plant and equipment (33) -
Interest received 5 -
--------------------------------------------------- --------- -----------------
Net cash generated from investing activities 1,337 -
--------------------------------------------------- --------- -----------------
Cash flows from financing activities
Issue of ordinary share capital 5,659 500
Cost relating to the issue of shares placing (254) (10)
Repayment of borrowings (24) -
Finance costs (14) -
--------------------------------------------------- --------- -----------------
Net cash generated from financing activities 5,367 490
--------------------------------------------------- --------- -----------------
Net increase in cash 5,524 126
Cash at bank and in hand at beginning of period 126 0
--------------------------------------------------- --------- -----------------
Cash at bank and in hand at end of period 5,650 126
--------------------------------------------------- --------- -----------------
Comprising:
Cash at bank and in hand 5,650 126
--------------------------------------------------- --------- -----------------
Notes to the consolidated financial information
1. General information
The Panoply Holding plc is a public limited company incorporated
in England and Wales under the Companies Act 2006 with registered
number 10533096. The Company's shares are publicly traded on the
AIM Market of the London Stock Exchange.
The address of the registered office is 141-143 Shoreditch High
Street, London, England, England, E1 6JE. The principal activity of
the Group is the provision of digitally native technology services
to clients within the commercial, government and NGO sectors.
These unaudited financial information is presented in pounds
sterling.
The financial information set out in this announcement does not
comprise the Group's statutory accounts as defined in section 434
of the Companies Act 2006 for the year ended 31 March 2019 or 31
March 2018.
The financial information for the year ended 31 March 2018 is
derived from the statutory accounts for that year 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 498 (2) or Section 498 (3) of the
Companies Act 2006 and did not include references to any matters to
which the auditor drew attention by way of emphasis.
The statutory accounts for the year ended 31 March 2019 have not
yet been delivered to the Registrar of Companies, nor have the
auditors yet reported on them. The preliminary announcement does
not constitute statutory accounts under Section 435 of the
companies Act 2006.
1.1 Basis of preparation
The consolidated financial information has been prepared in
accordance with applicable International Financial Reporting
Standards (IFRSs) as adopted by the EU and in accordance with the
Companies Act 2006 and the AIM rules for Companies. Details of the
accounting policies are set out below. This is the Group's first
financial information prepared in accordance with IFRS.
The financial information include the financial results of the
following subsidiaries (incorporated in the UK unless otherwise
stated) from the date of acquisition:
-- Bene Agere Norden AS (incorporated in Norway) - acquired on 4 December 2018.
-- Manifesto Digital Limited - acquired on 4 December 2018.
-- Not Binary Limited - acquired on 4 December 2018.
-- Questers Global Group Limited - acquired on 4 December 2018.
-- Deeson Group Limited - acquired on 17 December 2018.
-- iDisrupted Limited - acquired on 13 January 2019.
-- Greenshoot Labs Limited - acquired on 11 February 2019.
2. Accounting policies
The accounting policies adopted by the Group are consistent with
those applied in the preparation of the combined historical
financial information included in the Admission Document with the
exception of the following:
a) Basis of consolidation
The Group financial statements consolidate those of the Company
and all of its subsidiary undertakings drawn up to 31 March 2019.
Subsidiaries are entities over which the Group has the power to
control the financial and operating policies so as to obtain
benefits from its activities. The Group obtains and exercises
control through voting rights.
Unrealised gains on transactions between the Group and its
subsidiaries or associates are eliminated. Unrealised losses are
also eliminated unless the transaction provides evidence of an
impairment of the asset transferred. Amounts reported in the
financial statements of subsidiaries have been adjusted where
necessary to ensure consistency with the accounting policies
adopted by the Group.
Acquisitions of subsidiaries are dealt with using the purchase
method. The purchase method involves the recognition at fair value
of all identifiable assets and liabilities, including contingent
liabilities of the subsidiary, at the acquisition date, regardless
of whether or not they were recorded in the financial statements of
the subsidiary prior to acquisition. On initial recognition, the
assets and liabilities of the subsidiary are included in the
Consolidated Statement of Financial Position at their fair values,
which are also used as the cost bases for subsequent measurement in
accordance with the Group accounting policies.
Goodwill is stated after separating out identifiable intangible
assets. Goodwill represents the excess of consideration payable
over the fair value of the Group's share of the identifiable net
assets of the acquired subsidiary at the date of acquisition.
b) Goodwill
The Group measures goodwill at the acquisition date as:
-- the fair value of the consideration transferred; plus
-- the recognised amount of any non-controlling interests in the
acquiree; plus, if the business combination is achieved in stages,
the fair value of the existing equity interest in the acquiree;
less
-- the net recognised amount of the identifiable assets
acquired, and liabilities assumed.
When the excess is negative, a bargain purchase gain is
recognised immediately in profit or loss.
The consideration transferred does not include amounts related
to the settlement of pre-existing relationships. Such amounts are
generally recognised in profit or loss.
Costs related to acquisition, other than those associated with
the issue of debt or equity securities that the Group incurs in
connection with a business combination, are expensed as
incurred.
If the contingent consideration is classified as equity, it is
not remeasured, and settlement is accounted for within equity.
Otherwise, subsequent changes to the fair value of the contingent
consideration are recognised in profit or loss. Goodwill is carried
at cost less accumulated impairment losses.
c) Intangible assets acquired as part of a business combination and amortisation
In accordance with IFRS 3 "Business Combinations", an intangible
asset acquired in a business combination is recognised at fair
value at the acquisition date. A fair value calculation is carried
out based on evaluating the net recurring income stream from each
type of intangible asset. Intangibles are initially recognised at
fair value, and are subsequently carried at this fair value, less
accumulated amortisation and impairment. The following items were
identified as part of the acquisitions of entities by the Group and
were still owned at 31 March 2019:
-- brand amortised over two to five years;
-- customer lists amortised over three to six years;
-- customer list database over five years; and
-- Intellectual property over ten years.
The allocation of fair values to the tangible assets and the
identification and valuation of intangible assets affect the
calculation of goodwill recognised in respect of an acquisition and
as such represent a key source of estimation uncertainty.
3. Revenue and adjusted EBITDA
3.1.1 Revenue by service Unaudited Audited
2019 2018
GBP'000 GBP'000
------------------------------------------ -------------- ------------------
Experience 2,323 -
XaaS 1,698 -
Transformation 2,870 -
Automation 1,162 -
Intelligence 99 -
Total Revenue 8,152 -
------------------------------------------ -------------- ------------------
3.1.2 Revenue customers by geographical Unaudited Audited
market 2019 2018
GBP'000 GBP'000
------------------------------------------ -------------- ------------------
United Kingdom 6,511 -
EU 28 -
Norway 769 -
Switzerland 552 -
USA 291 -
Other 1 -
Total Revenue 8,152 -
------------------------------------------ -------------- ------------------
3.1.3 Revenue by sectors Unaudited Unaudited
2019 2018
GBP'000 GBP'000
------------------------------------------ -------------- ------------------
Commercial 2,871 -
Government 3,050 -
NGO 2,231 -
------------------------------------------ -------------- ------------------
Total Revenue 8,152 -
------------------------------------------ -------------- ------------------
3.1.4 Adjusted EBITDA
Unaudited Unaudited
2019 2018
GBP'000 GBP'000
------------------------------------------ -------------- ------------------
Experience 125 -
XaaS 83 -
Transformation 190 -
Automation 1 -
Intelligence 3 -
402 -
Total Adjusted EBITDA
------------------------------------------ -------------- --------------------
4. Earnings per share
Unaudited Audited
2019 2018
GBP'000 GBP'000
-------------------------------------------- --------- -------
Loss attributable to ordinary shareholders (1,677) (480)
-------------------------------------------- --------- -------
Number Number
----------------------------------------------------- ----------- -------
Weighted average number of Ordinary Shares in issue,
basic 18,186,006 10,500
Basic and diluted loss per share (9.22) p (4.57)p
----------------------------------------------------- ----------- -------
Earnings per ordinary share has been calculated using the
weighted average number of shares in issue during the year.
The diluted earnings per share is the same as the earnings per
share due to the consolidated Group loss.
The Group have a number of share -based payments (and share
purchase agreements where the terms and conditions could affect the
measurement of basic and diluted earnings per share. A number of
shares that were issued during the period are contingent on certain
conditions being met and therefore these have been excluded from
the calculation of the weighted average number of Ordinary Shares
in issue.
5. Post-balance sheet events
Not binary Limited created a new subsidiary Human Plus Ltd which
started trading from 1 April 2019. The company specialises in
robotic process automation (RPA).
The Panoply Holdings Plc acquired FutureGov on the 11 June 2019.
The initial consideration for the Acquisition was GBP11.8m,
satisfied though the payment of circa GBP6m cash and the issue of
6,612,397 new ordinary shares in The Panoply. In addition, The
Panoply also procured, on Completion, the repayment of loan notes
issued by FutureGov to certain shareholders with a principal amount
totalling GBP500,000 by FutureGov (the "Loan Notes").
The Group is currently performing a fair value review of
FutureGov's's assets and liabilities and will report these within
its financial statements for the year ended 31 March 2020.
The Panoply has entered into a three year GBP5m revolving credit
facility with HSBC (the "RCF Facility") pursuant to which GBP3.55m
will be drawn-down to pay a proportion of the cash consideration
payable pursuant to the FutureGov acquisition. HSBC has taken
security over The Panoply and all of the Group's material
subsidiaries and their assets in connection with the RCF Facility.
The interest rate is LIBOR + margin 2.5%.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
FR EAAPDEASNEFF
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August 05, 2019 02:00 ET (06:00 GMT)
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