REG - Ingenta PLC - Final Results
28/05/2024 07:00
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RNS Number : 9328P Ingenta PLC 28 May 2024
Ingenta plc
(the 'Group' or the 'Company')
Final Audited Results
Ingenta plc (AIM: ING) a leading software and services provider to the
publishing and media industries, announces its final audited results for the
year ended 31 December 2023.
Positive Financial Performance
· Revenue increased 3% to £10.8m (2022: £10.5m).
· Annual Recurring Revenue (ARR)* of £8.7m, representing 80% of
total revenue (2022: £9.0m, 86%). New customer implementations in 2023
expected to yield approximately £0.5m of ARR in 2024.
· Adjusted EBITDA** £2.2m (2022: £2.3m****). The 2022 adjusted
EBITDA figure was previously reported as £2m. This has been impacted by a
prior period adjustment which has reduced direct costs by £0.3m and increased
reported profitability by £0.3m.
· Net profit of £2.3m (2022: £1.8m****).
· Adjusted earnings per share of 12.77 pence*** (2022: 11.30
pence****).
· Reported earnings per share of 15.82 pence (2022: 10.88
pence****).
· Full year dividend increased 19% to 4.1 pence (2022: 3.45 pence),
with proposed final dividend of 2.6 pence per share (2022: 2.25 pence),
reflecting the Board's confidence in the Group's prospects.
Strong Balance Sheet Reinforced by Recurring Cash Flows
· Operating cash inflows of £1.1m (2022: £2.5m). The Group
maintains an element of annual billing in advance and more invoices were
raised and more cash received upfront at the end of 2022 than at the end of
2023.
· All significant lease obligations now repaid.
· Cash balances at year end of £2.7m (2022: £2.4m).
Encouraging Operational Delivery Leveraging New Group Structure
· Ingenta Content had one of its most successful years yet, winning
prestigious new customers and expanding into its target markets, with new
customers in the US and the NGO sector.
· Two Ingenta Content customer go-lives in the year plus four
further projects due to complete in 2024, with these deals expected to add
approximately £0.5m to ARR.
· Ingenta Commercial has continued to broaden its reach,
demonstrating our product's capabilities for IP management in a rapidly
evolving global market.
· Three new customers added onto the Ingenta Commercial IP
management platform. These deals are for music and media partners across the
globe and further increase conChord's breadth and reach.
· Customers continue to value Ingenta's expertise and support
during their wider technology and infrastructure changes, with Group
consultancy revenues up £0.6m, driven by implementation and consultancy work
across the product portfolio.
Current Trading
· Ongoing implementations on track, with two further Ingenta
Content go lives in Q1 2024.
· Strong pipeline of project work being built for later in the
year.
· Trading in line with expectations with our focus on delivering
sales growth.
Dividend Timetable
Subject to approval at the forthcoming AGM, the Company is pleased to announce
a final dividend of 2.6 pence per share will be paid on 19 July 2024. The
ex-dividend date is 13 June 2024 and the associated record date for the final
dividend is 14 June 2024.
* ARR - revenue generated and recognised in the year from annually recurring
software support contracts, hosting services and managed services.
**Adjusted EBITDA - EBITDA before gain / loss on disposal of fixed assets and
foreign exchange gain / loss. See note 3 for details.
***Adjusted earnings per share - earnings before tax and foreign exchange gain
/ loss
**** Comparative restated. See note 8.
Scott Winner, Chief Executive Officer, commented:
"It is pleasing to see the Company continuing its progression on an upward
trajectory. The expansion of our web-based content platform has been critical
to driving growth, and the continued expansion of our IP product into new
markets which is now in use in five countries has demonstrated the offering
and the adaptability of our Commercial product to meet new markets.
Continued growth and expansion of our customer base will be the primary focus
in 2024. Having won a number of key new customer accounts, and demonstrated
that with our streamlined operating structure we can deliver new business more
profitably, we are expecting any new future revenues to make a substantial
contribution to our profits and cash flows."
Certain of the information contained within this announcement is deemed by the
Company to constitute inside information as stipulated under the UK version of
the EU Market Abuse Regulation (2014/596) which is part of UK law by virtue of
the European Union (Withdrawal) Act 2018, as amended and supplemented from
time to time.
For further information please contact:
Ingenta plc
Scott Winner / Jon
Sheffield Tel: 01865
397 800
Cavendish Capital Markets Limited
Katy Birkin / Callum
Davidson Tel: 020 7220 0500
Chairman's statement
Overview
Ingenta provides mission-critical software and services to the publishing
sector, with growth aspirations in adjacent industries. Our strategic focus is
to accelerate growth in annual recurring revenue, via the sale of software as
a service (SaaS) wherever possible. This allows us to leverage our new
operational structure, following our move to a product-agnostic services
architecture. We now have an integrated approach to serving our customers,
with standardised software and service levels allowing us to utilise our
resources more efficiently.
We continue to see the benefits of the changes mentioned above and I am
extremely encouraged by the results presented here. Our Content business has
had one of its best years yet, picking up prestigious new customers and
expanding into its target markets. Likewise, our SaaS based Commercial product
has widened its reach, proving its ability to handle the intricacies of IP
management in a rapidly evolving global market.
In 2022, the Content division successfully established an efficient upgrade
path, allowing customers to migrate up our product hierarchy to take full
advantage of the breadth of functionality on offer. This proved popular again
in 2023, with two customers following suit and I am delighted to say we also
added some significant new customers to our platform. One of our key
strategies is to exploit the US market and expand our reach into the NGO
sector and we were successful on both counts. Both projects are significant in
value and with active partners, who can open doors to further business.
The Commercial division has been busy on two fronts, providing consultancy
services to customers as they enhance their existing infrastructure, and
rolling out our SaaS-based IP management solution. We provide a range of
services that allow customers to focus on their core business, without the
distractions of running and maintaining their wider technology estate. In this
respect, we have helped clients with key hardware migrations and system
enhancements, so they can now operate as they see fit rather than being held
back by historical decisions. The Group's IP management software continues to
build its presence, with three new deals signed with partners in North America
and Asia. The diversity of the geographies that we now operate in is
encouraging for the product's future, as we look to accelerate growth.
Financial Performance and Dividends
The Board remains committed to generating shareholder value and the Group
reports earnings per share for 2023 of 15.82 pence (2022 restated: 10.88
pence), driven in part by the tender offer to repurchase 1.8m shares at the
end of 2022. In further support of shareholder value, the Board has maintained
its progressive dividend policy and the Group paid an interim dividend of 1.5
pence per share (2022: 1.2 pence). We have proposed a final dividend of 2.6
pence per share (2022: 2.25 pence) subject to approval at the forthcoming AGM.
Outlook
The Group moves into 2024 with renewed vigour, after a second year of revenue
growth. The core product offerings have an established customer base built up
over a broad spectrum of target markets, which should allow significant
opportunities for further organic growth. The Board will also consider future
earnings accretive acquisitions to accelerate growth in new or existing
verticals.
Martyn Rose
Chairman
Financial review
Segmental Reporting
As outlined in the prior year, the Group has moved away from a product
orientated reporting structure and now operates as one segment with two core
revenue types that deal with similar operational concepts. Our core revenue
groupings are Ingenta Commercial and Ingenta Content. The key changes over the
prior year are that Ingenta Content now incorporates PCG, our sales and
marketing consultancy for publishers, and Ingenta Commercial includes the
Ingenta Advertising business, which helps customers to sell and track digital
and print advertising.
Ingenta Commercial
Ingenta Commercial provides a variety of modular publishing management systems
for both print and digital products. Its core area of expertise is
Intellectual Property management, including the associated contracts, rights
and royalties, and we are looking to leverage this expertise by expanding into
adjacent verticals. For example, we have already deployed our conChord
solution, which is designed for the music industry, and we see further
opportunities in other verticals where IP management is an increasing concern
for customers.
Commercial revenues were £7.6m (2022: £7.9m) with the decrease driven mainly
by the expected attrition within advertising which contributed £0.4m of
revenue (2022: £0.6m). Consultancy revenues were strong as customers pushed
ahead with project work to further embed Ingenta systems into their processes
and to modernise back-end IT infrastructure. As in prior years, the first half
of the year was more active in this area as customers utilised their budgets,
with their focus in the second half switching to planning for the following
year. The pipeline for these projects remains encouraging into 2024.
Ingenta Content
The Ingenta Content suite of products enable publishers of any size,
discipline or technical proficiency to convert, store, deliver and monetise
digital content on the web.
Annual revenue increased strongly from £2.6m to £3.2m, driven by £0.5m of
new customer implementation revenues. Of the implementation work, two
customers went live in the year with the remainder scheduled for 2024. These
projects are anticipated to yield ongoing annual recurring revenues of £0.5m.
Financial Performance
Group revenue increased to £10.8m (2022: £10.5m). This was marginally below
budget mainly because of delays to new project work in the second half of the
year, as customers rescheduled their plans. These projects are now being
progressed for 2024.
Annual recurring revenue (see note 2) was £8.7m or 80% of total revenue
(2022: £9.0m and 86% respectively). Although annual recurring revenue
declined year on year due primarily to a decline in heritage Commercial
revenues, the new sales achieved will support annual recurring revenue growth
into 2024 by approximately £0.5m.
Sales and marketing spend increased from £0.7m to £0.8m, as we started to
invest in sales and marketing efforts to support these early signs of growth.
Administrative costs declined by £0.6m to £2.6m (2022: £3.2m) driven mainly
by reduced depreciation and a movement from a net foreign exchange loss to a
net foreign exchange gain in 2023.
Adjusted EBITDA was £2.2m (2022 restated: £2.3m), which was higher than
budget as we delayed staff hiring because of the difficulty of finding
suitable candidates, particularly in sales. Our current plan is to engage
third-party consultants, especially for strategic sales positions. The 2022
adjusted EBITDA figure has been impacted by a prior period adjustment which
has increased previously reported profitability by £0.3m. The adjustment
reflects the release of development provisions relating to software as a
service revenues where the underlying software asset is owned by the Group.
IFRS15 and IAS37 require these costs to be expensed as incurred rather than
accrued in advance.
Profit from operations improved by £0.5m to £2.0m (2022 restated: £1.5m) as
disclosed in the statement of comprehensive income.
No significant tax charge is anticipated for 2023, as the Group continues to
utilise brought forward tax losses. Going forward, we estimate that we will be
able to use £12.9m and $6.3m of the available tax losses in the UK and US.
Additionally, our assessment of our deferred tax asset relating to these
losses increased, generating a tax credit in the year of £0.3m (see note 5
for further details).
Financial Position
Non-current assets include goodwill related solely to the core Content
platform software, which will be used to drive growth in the future. We test
goodwill for impairment each year using discounted cashflows and did not
identify any impairment in the year. Reductions in property, plant and
equipment are a direct result of our infrastructure strategy, which has seen
us leverage more Cloud-based services and reduce our business premises. The
deferred tax asset increased, based on our current assessment of trading
performance and utilisation of available tax losses.
Current assets increased from £4.3m to £4.9m driven by improved trading
performance generating additional cash and near-cash debtor balances, which
will be received in early 2024.
Total liabilities decreased from £4.6m (restated) to £3.6m, as we cleared
our leasing obligations and transitioned to a more SaaS-based billing
structure, which entails lower contract liabilities (deferred income).
Cashflow
The Group generated £1.1m of operating cashflow in the year (2022: £2.5m).
Although we are embracing a SaaS model for new business, a significant element
on upfront annual billing remains and the timing of these cash receipts is
uncertain. Comparatively, we raised more invoices and received more cash
upfront at the end of 2022 than at the end of 2023. However, this is purely a
timing issue and the Group has no experience of significant bad debt or
non-payment. The Group continues to reduce its ongoing capital expenditure and
has completed repayment on all significant leasing commitments.
The Group continues its progressive dividend policy and paid out £0.5m in the
year (2022: £0.5m). The full year dividend for 2023 is expected to increase
by 19% to 4.1 pence per share (2022: 3.45 pence).
Closing cash balances were £2.7m (2022: £2.4m). Year-end cash balances were
above budget as potential capital expenditure for significant new projects was
not required, as the work pushed out into 2024.
Going concern
The core fundamentals of the Group remain strong, with cash reserves at the
end of March 2024 of over £2.9m and no debt on the balance sheet. The new
business structure is firmly in place allowing profitable operations to
continue, whilst also generating improved new sales momentum particularly
within Ingenta Content. The Directors have prepared detailed cashflow
projections, including sensitivity analysis, to the end of June 2025.
Management is satisfied that cash is sufficient for the needs of the business
and accordingly, the Group continues to adopt the going concern basis in
preparing its consolidated financial statements.
Outlook
The performance in 2023, particularly within Ingenta Content, has increased
our optimism for 2024. We have added to our growing base of NGO customers and
made significant inroads into the North American market with a prestigious,
globally recognised scientific publisher with whom we anticipate an active
pipeline of future business. Ingenta Commercial is also building momentum as
we continue to welcome more customers from across the globe onto our conChord
music IP platform. To further exploit opportunities as they arise, the Group
will aim to increase investment into its sales and marketing efforts, to
accelerate revenue growth in 2024.
Jon Sheffield
Chief Financial Officer
Group Statement of Comprehensive Income
Year ended Restated Year ended
31 Dec 23 31 Dec 22
note £'000 £'000
Group revenue 2 10,825 10,451
Cost of sales (5,429) (5,048)
Gross profit 5,396 5,403
Sales and marketing expenses (757) (707)
Administrative expenses (2,590) (3,176)
Profit from operations 3 2,049 1,520
Finance costs (17) (21)
Profit before income tax 2,032 1,499
Income tax 5 267 260
Profit for the year attributable to equity holders of the parent 2,299 1,759
Other comprehensive expenses which will be reclassified subsequently to profit
or loss:
Exchange differences on translation of foreign operations (190) 307
Total comprehensive profit for the year attributable to equity holders of the 2,109 2,066
parent
Basic profit per share (pence) 6 15.82 10.88
Dilutive profit per share (pence) 6 15.50 10.40
All activities are classified as continuing
Group Statement of Financial Position
Note 31 Dec 23 Restated
31 Dec 22
£'000 £'000
Non-current assets
Goodwill 2,661 2,661
Property, plant and equipment 93 302
Deferred tax asset 1,622 1,384
4,376 4,347
Current assets
Trade and other receivables 2,185 1,910
Cash and cash equivalents 2,676 2,376
4,861 4,286
Total assets 9,237 8,633
Equity
Share capital 7 1,512 1,512
Capital redemption reserve 180 180
Merger reserve 11,055 11,055
Reverse acquisition reserve (5,228) (5,228)
Share option reserve 140 117
Translation reserve (488) (298)
Retained earnings (1,510) (3,264)
Total equity 5,661 4,074
Non-current liabilities
Deferred tax liability - 37
- 37
Current liabilities
Trade and other payables 1,218 1,699
Provisions 307 139
Contract liabilities 2,051 2,684
3,576 4,522
Total liabilities 3,576 4,559
Total equity and liabilities 9,237 8,633
Group Statement of Changes in Equity
Share capital Capital redemption reserve Merger reserve Reverse acquisition reserve Translation reserve Retained earnings Share option reserve Total attributable to owners of parent
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance at 1 January 2022 1,692 - 11,055 (5,228) (605) (2,278) 88 4,724
Dividends paid - - - - - (523) - (523)
Shares repurchased and cancelled (180) 180 - - - (2,222) - (2,222)
Share options granted in the year - - - - - - 29 29
Transactions with owners (180) 180 - - - (2,745) 29 (2,716)
Profit for the year restated - - - - - 1,759 - 1,759
Foreign exchange differences on translation - - - - 307 - - 307
Total comprehensive income for the year - - - - 307 1,759 - 2,066
Restated balance at 31 December 2022 1,512 180 11,055 (5,228) (298) (3,264) 117 4,074
Dividends paid - - - - - (545) - (545)
Share options granted in the year - - - - - - 23 23
Transactions with owners - - - - - (545) 23 (522)
Profit for the year - - - - - 2,299 - 2,299
Foreign exchange differences on translation - - - - (190) - - (190)
Total comprehensive income for the year - - - - (190) 2,299 - 2,109
Balance at 31 December 2023 1,512 180 11,055 (5,228) (488) (1,510) 140 5,661
Group Statement of Cash Flows
Year ended Restated Year ended
31 Dec 23 31 Dec 22
Note £'000 £'000
Profit before taxation 2,032 1,499
Adjustments for
Depreciation 288 412
Profit on disposal of fixed assets - (4)
Interest expense 17 21
Share based payment charge 23 29
Increase in trade and other receivables (276) (100)
(Decrease) / increase in trade and other payables and contract liabilities (1,112) 455
Increase in provisions 168 139
Cash inflow from operations 1,140 2,451
Tax paid (7) (8)
Net cash inflow from operating activities 1,133 2,443
Cash flows from investing activities
Purchase of property, plant and equipment (80) (45)
Net cash used in investing activities (80) (45)
Cash flows from financing activities
Interest paid (17) (21)
Payment of lease liabilities (192) (258)
Dividend paid (545) (523)
Costs of share repurchase - (2,222)
Net cash used in financing activities (754) (3,024)
Net increase / (decrease) in cash and cash equivalents 299 (626)
Cash and cash equivalents at the beginning of the year 2,376 3,006
Exchange differences on cash and cash equivalents 1 (4)
Cash and cash equivalents at the end of the year 2,676 2,376
1. Basis of preparation
The financial information of the Group set out above does not constitute
statutory accounts for the purposes of Section 435 of the Companies Act
2006. The financial information for the year ended 31 December 2023 has
been extracted from the Group's audited financial statements which were
approved by the Board of directors on 24 May 2024.
The financial information for the year ended 31 December 2023 has been
extracted from the Group's financial statements for that period. The report
of the auditor on the 2023 financial statements was unqualified, did not
include any references to any matters to which the auditors drew attention by
way of emphasis without qualifying their report and did not contain a
statement under Section 498(2) or Section 498(3) of the Companies Act 2006.
Whilst the financial information included in this preliminary announcement
has been prepared in accordance with UK adopted international accounting
standards ("IASs") in conformity with the requirements of the Companies Act
2006, the International Financial Reporting Interpretations Committee
("IFRIC"), interpretations issued by the International Accounting Standards
Boards ("IASB") that are effective or issued and adopted as at the time of
preparing these financial statements, and in accordance with the provisions of
the Companies Act 2006 that are relevant to companies that report under UK
adopted IASs, this announcement does not itself contain sufficient information
to comply with those IASs. This financial information has been prepared in
accordance with the accounting policies set out in the 2022 Report and
Accounts and updated for new standards adopted in the current year.
Items included in the financial information of each of the Group's entities
are measured using the currency of the primary economic environment in which
the entity operates (the functional currency). The consolidated financial
information is presented in UK sterling (£), which is the Group's
presentational currency.
The Company is a public limited company incorporated and domiciled in England
& Wales and whose shares are quoted on AIM, a market operated by the
London Stock Exchange.
The principal activity of Ingenta plc and its subsidiaries is the sale of
software and ancillary services.
2. Revenue
An analysis of the Group's revenue is detailed below by activity across the
Group's operating units:
Year ended Year ended
31 Dec 23 31 Dec 22
£'000 £'000
Licences 24 49
Consulting Services 2,087 1,398
Non-recurring revenue 2,111 1,447
Hosted Services 3,509 3,549
Managed Services 2,668 2,961
Support and upgrade 2,197 2,198
PCG 340 296
Annual recurring revenue 8,714 9,004
10,825 10,451
An analysis of the Group's revenue by product type is detailed below:
Year ended Year ended
31 Dec 23 31 Dec 22
£'000 £'000
Commercial product division 7,646 7,895
Content product division 3,179 2,556
10,825 10,451
A geographical analysis of the Group's revenue is detailed below:
Year ended Year ended
31 Dec 23 31 Dec 22
£'000 £'000
UK 5,266 5,729
USA 4,418 3,612
Netherlands 345 417
France 208 219
Rest of the World 588 474
10,825 10,451
Two customers each contributed more than 10% of revenue (2022: two) and this
amounted to £3,578K (2022: £3,886K).
3. Profit from operations
Profit from operations has been arrived at after charging:
Year ended Year ended
31 Dec 23 31 Dec 22
£'000 £'000
Research and development costs 1,176 1,091
Net foreign exchange (gain) / loss (168) 328
Depreciation of property, plant and equipment
- owned assets 94 129
- leasehold property - 21
- assets under leases 194 262
Auditor's remuneration 140 141
An analysis reconciling the profit from operations to adjusted EBITDA is
provided below.
Year ended Restated Year ended
31 Dec 23 31 Dec 22
£'000 £'000
Profit from operations 2,049 1,520
Add back:
Depreciation and amortisation 288 412
Gain on disposal of fixed assets - (4)
Foreign exchange (gain) / loss (168) 328
EBITDA before gain / loss on disposal of fixed assets and foreign exchange 2,169 2,256
gain / loss
4. Operating segments
Management provides information reported to the Chief Operating Decision Maker
(CODM) for the purpose of assessing performance and allocating resources. The
CODM is the Chief Executive Officer.
The CODM monitors revenue on a product basis. Costs are Incurred by a product
agnostic central support function which services all products and revenue
streams. Operating profit is only monitored at Group level therefore
Management have determined there is only one operating segment.
Significant product types are: Ingenta Commercial products and Ingenta Content
products.
Ingenta Commercial products are back end enterprise level publishing and
Intellectual property (IP) management systems. Ingenta Content products help
content providers distribute their content online.
The Group derives revenue from the revenue streams reported in the revenue
analysis in note 2.
5. Tax
Year ended Year ended
31 Dec 23 31 Dec 22
£'000 £'000
Analysis of (charge) / credit in the year
Current tax:
Current year State tax - US (5) (9)
Adjustment to prior year charge - UK (3) (3)
Deferred tax credit 275 272
Taxation 267 260
The Group has unutilised tax losses at 31 December 2023 in the UK and the USA
of £13.9m (2022: £15.1m) and $7.0m (2022: $8.2m) respectively. These losses
have been agreed with the tax authorities in the UK and USA. The Board intends
to make use of all losses wherever possible.
Management have utilised £6.4m of UK losses to recognise a £1.6m (2022:
£1.3m) deferred tax asset at year end which is based on expected UK taxable
profits over the next 5 years. Management do not believe they have adequate
information to make an assessment of utilisation beyond 5 years. No US
deferred tax asset has been recognised in accordance with advice from tax
accountants on the basis that the US losses are restricted and there is
uncertainty on the value of losses which will be able to be used.
At year end there are unutilised tax losses of £7.5m and $7m in the UK and US
respectively. From 1 April 2023, the corporation tax rate applicable to
companies with taxable profits above £250,000 is 25 per cent. Companies with
profits below £50,000 will, however, continue to pay tax at the current rate
of 19 per cent. Those with taxable profits between £50,000 and £250,000 will
benefit from marginal relief, similar to that which applied before the
previous incarnation of the small companies' rate of corporation tax was
abolished with effect from 1 April 2015.
The differences are explained below:
Reconciliation of tax expense Year ended Restated Year ended
31 Dec 23 31 Dec 22
£'000 £'000
Profit on ordinary activities before tax 2,032 1,499
Tax at the UK corporation tax rate of 23.5% (2022: 19%) 477 285
Income / expenses not allowable for tax purposes (22) 44
Unrelieved losses carried forward 31 58
Utilisation of losses (525) (443)
Difference in timing of allowances 42 59
Deferred tax movement (275) (272)
Adjustment to tax charge in respect of prior years 5 9
Total taxation (267) (260)
United Kingdom Corporation tax is calculated at 23.5% (2022: 19%) of the
estimated assessable profit for the year.
Taxation for other jurisdictions is calculated at the rates prevailing in the
respective jurisdictions.
6. Earnings per share
Basic earnings per share is calculated by dividing the earnings attributable
to ordinary shareholders by the weighted average number of ordinary shares
outstanding during the year.
For diluted earnings per share, the weighted average number of ordinary shares
in issue is adjusted to assume conversion of all dilutive ordinary share
options. Management estimate there are a further 297,097 ordinary shares
(2022: 145,535) in respect of share options.
Year ended Restated Year ended
31 Dec 2023 31 Dec 2022
£'000 £'000
Attributable profit 2,299 1,759
Weighted average number of ordinary shares used in basic earnings per share 14,535 16,169
('000)
Shares deemed to be issued in respect of share-based payments 297 146
Weighted average number of ordinary shares used in dilutive earnings per share 14,832 16,315
('000)
Basic profit per share arising from both total and continuing operations 15.82p 10.88p
Dilutive profit per share arising from both total and continuing operations 15.50p 10.78p
Dividends
On 14 August 2023 the Company paid a final dividend of 2.25 pence per share
for the year ended 31 December 2022. On 23 October 2023 an interim dividend of
1.5 pence per share was paid in respect of the year ended 31 December 2023.
After the year end, the Directors declared their intention to pay a final
dividend of 2.6p for the year ended 31 December 2023.
7. Share capital
Year ended Year ended
31 Dec 2023 31 Dec 2022
£'000 £'000
Issued and fully paid:
15,123,125 (2022: 15,123,125, 2021: 16,919,609) ordinary shares of 10p each 1,512 1,512
There is one class of ordinary shares and holders are entitled to receive
dividends as declared from time to time and are entitled to one vote per share
at shareholder meetings.
8. Prior period adjustment
In the prior year, the Group recorded software provisions of £439K within
accruals which related to development work required to ensure older software
products could easily migrate to newer versions of hardware and also integrate
with necessary third party software integrations. These amounts had previously
been reported within accruals but should have been disclosed separately on the
face of the statement of financial position as a provision. Additionally,
£300K of the previously reported £439K software development provision was
connected to software as a service revenues where the underlying software
asset is owned by the Group. IFRS15 and IAS37 do not allow the recognition of
a provision in these circumstances and dictate that these development costs
should be expensed as incurred rather than accrued in advance. Therefore, this
£300K component of provisions has been credited to the 2022 statement of
comprehensive income as a prior period adjustment.
The error has been corrected by restating each of the affected financial
statement line items as follows:
Year ended Change Restated
31 Dec 22 Year ended
31 Dec 22
£'000 £'000
Group statement of comprehensive income extract
Cost of sales (5,348) 300 (5,048)
Gross profit 5,103 300 5,403
Profit from operations 1,220 300 1,520
Profit before income tax 1,199 300 1,499
Profit for the year attributable to equity holders of the parent 1,459 300 1,759
Total comprehensive profit for the year attributable to equity holders of the 1,766 300 2,066
parent
Group statement of financial position extract
Trade and other payables 2,138 (439) 1,699
Provisions - 139 139
Total liabilities 4,859 (300) 4,559
Retained earnings (3,564) 300 (3,264)
Total equity 3,774 300 4,074
Group statement of changes in equity extract
Profit for the year 1,459 300 1,759
Retained earnings (3,564) 300 (3,264)
Group statement of cashflows extract
Increase in trade and other payables and contract liabilities 894 (439) 455
Increase in provisions - 139 139
Other changes
Basic profit per share (pence) 9.02 1.86 10.88
Diluted profit per share (pence) 8.94 1.46 10.40
9. Publication of non-statutory accounts
The financial information set out in this announcement does not constitute
statutory accounts as defined in the Companies Act 2006.
The Group Statement of Comprehensive Income, Group Statement of Financial
Position, Group Statement of Changes in Equity, Group Statement of Cash Flows
and associated notes have been extracted from the Group's 2023 statutory
financial statements upon which the auditor's opinion is unqualified and which
do not include any statement under section 498 of the Companies Act 2006.
Those financial statements will be delivered to the Registrar of Companies
following the release of this announcement.
This announcement and the annual report and accounts, including the Notice of
Annual General Meeting, are available on the Company's website
www.ingenta.com. A copy of the report and accounts will be sent to
shareholders who have elected to receive a printed copy with details of the
annual general meeting in due course.
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