TIDMVNET
RNS Number : 6348H
Vianet Group PLC
26 March 2020
Press release
26 March 2020
Vianet Group plc
("Vianet" or the "Group")
Trading and COVID-19 Update and Notice of Results
Vianet Group plc (AIM: VNET), the international provider of
actionable data and business insight through devices connected to
its Internet of Things ("IOT") platform, today provides an update
on progress and trading in respect to the situation regarding
COVID-19. The Group also notifies that, subject to FCA and or
auditor guidance relating to COVID-19, it will release its results
for the year ended 31 March 2020 on Tuesday, 2 June 2020.
The Group continues to implement detailed COVID-19 response
plans, as the advice from Government evolves. Our aim remains to
safeguard employee health and wellbeing, whilst continuing to
support our customers and maintain the Group's robust financial
position.
Trading for the second half of the year has been largely as
anticipated and, as a result, subject to any further COVID-19
provisions, the Group's full year profits for the year ended 31
March 2020 will be in line with market expectations at over
GBP4.00m and ahead of the GBP3.85m reported last year.
COVID-19 Commercial Impacts
The mandatory closures of pubs, bars and restaurants in the UK
will have a material effect on almost all our Smart Zones
customers. In anticipation of this, we had therefore proposed a
reduced rate on all our contracts in order to maintain business
continuity and to avoid more expensive reconnection costs for
customers when pubs reopen. We are encouraged by our customers'
responses and expect to be able to protect a meaningful portion of
the Group's recurring revenue during this period of pub
closures.
It is too early to predict the overall impact of COVID-19 on our
Smart Machines business as we have seen mixed trading impacts
across the range of our customers. Some vending machines, including
those in hospitals, supply chains and emergency services are
trading very well, whereas those in closed city centre offices have
experienced little or no sales. As with Smart Zones customers, we
are providing impacted Smart Machines customers with the option of
a reduced weekly charge in closed sites. Positively, we are seeing
increased demand and usage of our contactless payment solution
rather than 'dirty' coins.
Liquidity and Financial Resilience
In addition to the actions taken to protect a meaningful portion
of our recurring revenues, the business has eliminated
non-essential costs and spend, and is working hard to minimise
supply chain exposure. The Group will take advantage of the full
range of business support measures announced by the Government in
recent days, including guaranteed loans, and in particular the
Group is well advanced with the job retention scheme, where the
government refunds 80% of salary for employees who are not
working.
The Group has good liquidity with trade debts of approximately
GBP2.2m, an overdraft facility of GBP1.5m which is 80% utilised
ahead of customer receipts which are expected at the end of the
month, and GBP1.8m in our deposit account.
Taking account of the Group's current cash and available
resources, and modelling various prudent business scenarios, we are
confident that the actions taken mean that the Group has a cash
runway well beyond the period which the Government has indicated as
being the likely duration of this crisis. As such, the Board
believes that the Group is well placed to absorb a prolonged period
of uncertainty .
Dividend
Despite the strong financial position of the Group, given the
rising level of uncertainty as to how the COVID-19 situation will
develop, alongside the other measures we are taking to preserve the
cash position, the Board has decided to withdraw its recommendation
to pay a final dividend at the forthcoming AGM, which would amount
to approximately GBP1.16m. The Board will review this decision
again later in the year once the outlook becomes clearer.
The Board recognises that this is a significant decision, but
believes that it is an appropriate and prudent measure to take at
this point as the Group seeks to preserve its strong liquidity,
cash flow, and financial position through these uncertain
times.
Conclusion and Outlook
Ahead of the very recent impact of the COVID-19 restrictive
measures introduced by the Government, momentum and performance of
the Group had been encouraging across both divisions.
As seen during the past few weeks, the start to the new
financial year will be challenging, however the Group is well
equipped to weather this storm and emerge with even stronger
customer relationships.
The Board's absolute focus is on ensuring that Vianet comes
through this global crisis in a position to continue to take
advantage of its exciting growth opportunities. In the meantime,
the Board's priority is maintaining the health, wellbeing and
safety of our employees and customers.
This announcement contains inside information.
- Ends -
Enquiries:
Vianet Group plc
James Dickson, Chairman Tel: +44 (0) 1642 358
Stewart Darling, CEO / Mark Foster, 800
CFO www.vianetplc.com
Cenkos Securities plc
Stephen Keys / Cameron MacRitchie Tel: +44 (0) 20 7397
8900
www.cenkos.com
Media enquiries:
Yellow Jersey PR
Sarah Hollins Tel: +44 (0)7764 947
Henry Wilkinson 137
vianet@yellowjerseypr.com Tel: +44 (0)7951 402
336
www.yellowjerseypr.com
About Vianet
Vianet Group is a leading provider of actionable management
information and business insight created through combining data
from our smart Internet of Things ('IOT') solutions and external
information sources.
Since Admission to AIM in 2006, the Group has grown from its
core beer monitoring business both organically and through
strategic acquisitions to widen its offering and also develop new
businesses, especially in vending telemetry and contactless payment
solutions particularly for the premium coffee sector.
Servicing over 300 customers across the world and rendering live
data to our IOT platform from over 250,000 connected machines
daily, Vianet is one of the largest business to business (b2b)
connected solutions providers in Europe with established long term
relationships with blue chip customers and growing recurring
revenues which are over 85% of our total revenues.
In our Smart Machines Division we connect a single data
gathering device with its own on-board communication capability to
a customer's asset or system. The device then sends data back via
our IOT platform to cloud based servers. The technology was
originally developed for automated retailing machines, however the
flexibility and functionality of the device means the technology
can be applied to practically any machine which has the capability
to output data. The device is also used to connect our contactless
payment solution and communicate payment terms to our cloud based
payment services providers where that application is also
required.
The Smart Zones Division is where we connect multiple data
gathering devices into one or more systems or assets with the data
from those devices being communicated back to our IOT platform and
cloud based servers via a single 3G communications hub. The
technology was originally developed for flow monitoring devices,
temperature sensors, and asset management in drinks retailing but
practically any data gathering device with a digital output could
be connected to the communications hub where required such as
gaming machines, utilities management and EPOS.
For further information, please visit www.vianetplc.com
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END
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