July 15, 2010 02:01 ET
Final Results for the year ended 31 March 2010
15/07/2010
GB0009606764
ANS GROUP PLC
(PLUS: ANS.PL)
("ANS Group" or the "Company")
Final Results for the year ended 31 March 2010
Headlines
Turnover Increased by £1.2m to £13.3m up 10%
Gross Profit increased by £537,000 to £3.9m up 16%
Gross Margins increased from 27.9% to 29.5%
Investment of circa £500,000 within overheads
Adjusted Operating Profit (excluding investment of circa. £0.5m) up 21%
Cash Reserves increased by £1m to £4.3m up 32%
44% of Gross Profit from recurring revenues
Second Interim dividend maintained at 2.75p (2009-2.75p)
Strong start to the current year
Chairman's Statement
I am delighted to report another year of positive results for your company. The company has
increased Gross Profit by 16% (and an average of 17% year on year for the past six years). We have
delivered turnover growth of 10% (24% year on year for the past six years) and our cash balances
at the end of the year reached a record high of £4.3m compared to £3.3m in the previous year. A
strong focus on managed services and recurring revenues has led to 44% of Gross Profit coming from
these areas. These important metrics demonstrate that your company continues on its course of
growth despite the incredibly difficult market conditions in which we find ourselves. As reported
at the half year, we chose to invest significantly during the past year in several areas
including: two additional directors, key sales and technical staff, infrastructure renewals and
quality management systems which has equated to nearly £0.5m. The Board feel that this investment
was required in order to take the company forward to the targeted objective of £30m turnover. This
investment has already started to produce returns with the award of the much coveted Buying
Solutions Framework Agreement along with key industry accolades and accreditations and a
significantly improved start to the first quarter of the year. We believe that this use of cash
will provide enhanced returns for the business in the coming years.
Financial Highlights
Turnover has grown 10% from £12.1m to £13.3m with Gross Profit growing 16% which given the market
conditions is an excellent result. Even though the market has become more competitive we have
managed to improve Gross Margin from 27.9% to 29.5%. This is a result of our focus on the high end
technical solutions with specific key vendors and investment in new staff and systems. With 44% of
Gross Profit now being of a recurring nature the predictability of the business profits is
continuing to grow.
Our Administrative costs show an increase of £785,000 the bulk of which is a result of the £0.5m
investment undertaken during the year. The majority of this has been in employment related costs
which were planned for the development of the business and were necessary to facilitate growth
over the coming years. This investment has already made significant returns including the award of
the Buying Solutions Framework Agreement, Quality Standard ISO 9001 and ISO 14001. Further to this
there has been a marked improvement in our orders received during the second half of the year, as
well as the first quarter of this year being significantly ahead of last year.
The increase in costs during the year has led to a fall in Operating Profit from £1.1m to £0.9m
which reflects the planned investment made.
Interest received was down from £98,000 to £33,000 due the drop in base rate to 0.5%. Profit on
disposal of business of £82,000 was primarily due to the disposal of the company's interest in the
trade and assets of Viapost Ltd.
The company remains well capitalised with cash reserves of £4.3m and no debt.
Dividends
I am pleased to announce that we have maintained our second interim dividend at 2.75p (2009-2.75p)
per share. Having previously paid an interim dividend of 1.25p (2009-1.25p) per share this gives a
total for the year of 4p (2009-4p) per share. The dividend will be paid by 31 August 2010 to
shareholders on the register at the close of business on 30 July 2010.
Operational Review
In March 2010, the company was awarded access to the Government Buying Solutions Framework
Agreement which for a company of our size is testament to the dedication and hard work of the
whole team. This is one of the benefits arising from the investment in both our Quality Assurance
Systems and upgrades to our Integrated Management Information System. However the long term
benefits should be seen during the life of this 3 year contract award as we are now able to access
areas of government projects that were off limits to ANS in the past.
ANS, is one of only 13 companies to make LOT 2 of the Commoditised IT Hardware and Software
framework agreement to supply IT infrastructure hardware, with potential contracts worth a
significant value over three and a half years. The Framework is estimated to be worth £6 billion
turnover over the next three and a half years from which ANS Group as a supplier will benefit in
part.
The Unified Communications and Collaboration portfolio, where we combine technologies from our
strategic partners Cisco and Microsoft to deliver cost efficient business solutions, has delivered
growth of 5%.
The Data Centre division where Storage and Virtualisation partners Cisco, VMware, NetApp and
Microsoft deliver outstanding efficiency and cost reduction benefits, accounts for 47% of our
business. This has grown by 14% during the year and the benefits are being delivered across the
whole of our customer base, NHS, Local Government and the commercial sector.
Throughout the current year we have seen further development of the ANS Managed Service offerings
where the company's recurring revenues have grown 36% to £4.9 m. Our support team maintained their
outstanding levels of customer service once again this year, as reflected in our customer
retention performance of over 96%.
Our focus on technical excellence has continued with the launch of our Infrastructure 3.0
architecture in December 2009. Infrastructure 3.0 will be central to our development as a quality
and trusted partner for IT Solutions using next generation technology such as Cisco's Unified
Computing and Nexus Switching, VMware's Server and Desktop Virtualisation and NetApp's Intelligent
Storage and Deduplication to streamline and unify our customer's infrastructure. We have adapted
and developed our key specialisations to develop systems from which our customers generate real
value both from an operational and financial perspective. Our first Infrastructure 3.0 contract
win makes Tameside Hospital NHS Foundation Trust the first English-based NHS site to embrace
Cisco's new technology which is set to transform its computer network into a unified intelligent
data centre infrastructure. This demonstrates the ability of the company to assist the NHS with
its objective of introducing efficiency savings.
Appointment of new Technical Director - Andy Barrow
Andy was promoted to the position of Technical Director in April 2010 from his role as head of
technical pre-sales where he was responsible for overseeing the architecture and implementation of
our portfolio of solutions to our clients. His new position will allow him to identify new
opportunities for the group to capitalise upon and help to propel the current business plan
forward. Andy is both well qualified and experienced in all technical areas of the business
however, his real strengths lie in the Cisco and VMware arenas. He is CCIE certified in Security
for Cisco and has been with ANS Group since it acquired the Cisco partner, BIOS, four years ago.
Andy has already demonstrated that he will be a major asset to the Board. His recent work and
participation in the development of our new offering, Infrastructure 3.0, helped turn the vision
into a reality and he will be a major asset to the Board as the company develops and grows.
Accreditations and Key Partnerships
This year our focussed strategy has been the development of the Infrastructure 3.0 architecture
and we have invested maximum effort into enhancing our accreditation portfolio surrounding this
solution. ANS were the first Cisco tier 2 Partner to achieve success in the UCS ATP program. UCS
or Unified Computing System represents a radical simplification of traditional architectures,
dramatically reducing the number of devices that need to be purchased, cabled, configured,
powered, cooled, and secured. The solution delivers end-to-end optimisation for virtualised
environments while retaining the ability to support traditional OS and application stacks in
physical environments. This accreditation means that ANS Group is one of a select group of
companies in the UK who are able to provide specialist support to organisations who are looking to
implement this innovative type of computing power to enhance a virtualised infrastructure. More
uniquely, ANS are the only Cisco Gold Partner with a UCS ATP to carry a Cisco Gold Star for
customer satisfaction. In addition, we have become the fastest growing NetApp partner and moved
from Gold to Platinum Partner status within one year, truly highlighting our strength as the
leading storage vendor. This demonstrates our level of commitment to being at the forefront of
development in storage and virtualisation and ANS VMware sales have been at their highest levels
to date.
Awards
At ANS we take the industry awards seriously as they are a valid reflection of the effort and
level of technical expertise that we invest when we choose our best of breed partnership
solutions.
At the recent NetApp Partner Awards, the company was awarded the 'Best Newcomer of the Year' and
'Marketing Excellence of the Year' for Infrastructure 3.0. This was the first time any reseller
had been given two awards by NetApp. These awards fully compliment our VMware Partner of the Year
award which we received in December 2009. The awards demonstrate our commitment to our key
partners whose technologies we combine to produce our Infrastructure 3.0 offering.
Once again this year ANS entered the Best Companies to work for in 2010 and for the second year
running received the highest rating possible, 3 stars. Following this, ANS were shortlisted for
the Sunday Times Top 100 Best Small Companies to work for and jumped from position 24 to 9. This
was a huge achievement as these results are gathered from confidential employee surveys. Finally
ANS picked up the Manchester Evening News Business of the Year 2009, a prestigious award from a
leading local publication which is a fantastic achievement for ANS and all of our staff.
Outlook
Having decided to invest for the future the Board believes that the £0.5m invested in; staff
(numbers up 25%), infrastructure, the successful Buying Solutions application and quality
management systems, has positioned the business to achieve considerable growth without any further
significant step changes in the overhead costs. ANS has a strong management team with a robust
business infrastructure that is already showing signs of rising to the challenges ahead. The first
quarter's performance is already well in advance of last year with the technical delivery team
revenues breaking all records previously set. The order book is also considerably larger than that
in 2009 and that provides us with the confidence that our cost and efficiency saving portfolio of
solutions are positioned perfectly for our customers needs. Although for the last 6 months the
rate of closure on orders has taken much longer, a consequence of the scrutiny of customers
spending budgets, this has not resulted in the loss of any major business. In fact orders that had
been ongoing for a number of months have now closed in quarter one with some exciting wins that
have given us the confidence to look forward positively at the coming year.
The Board and management continue to focus their efforts on maintaining and delivering controlled
growth, good treasury management and increasing shareholder value.
In the recent emergency budget Mr. Osborne stated that NHS capital budgets would remain protected
and that the focus would be on efficiency savings and investments. The Board believe that your
company is well placed to assist the NHS reduce its overall IT costs with our current strategic
solutions. Whilst ANS has grown its public sector business during the year the overall proportion
has remained the same at around 55%.
The company has a comprehensive market leading solutions portfolio, a growing recurring revenue
stream and is operationally well placed to take advantage of any improvement in market conditions.
We believe that our 'spend to save' solutions are beneficial to most businesses even during the
critical conditions of a severe downturn. I therefore view the future with great confidence.
Once again I would like to thank all of the staff for their extraordinary efforts during these
extraordinary times and for producing extraordinary results.
Scott Fletcher
ANS Group Plc
AUDITED PROFIT AND LOSS ACCOUNT
YEAR ENDED 31ST MARCH 2010
2010 2009
£ £
Turnover 13,265,355 12,092,371
Cost of sales 9,352,090 8,716,132
Gross Profit 3,913,265 3,376,239
Administrative expenses 3,025,872 2,240,916
Operating Profit 887,393 1,135,323
Profit on disposal of business 81,616 290,363
Interest receivable and similar income 32,855 97,917
Interest payable and similar charges 0 504
Profit on ordinary activities before taxation 1,001,864 1,523,099
Tax on profit on ordinary activities 263,563 280,064
Profit on ordinary activities after taxation 738,301 1,243,035
Earnings per ordinary share 6.26 10.32
Diluted earnings per ordinary share 6.08 9.97
AUDITED BALANCE SHEET
31ST MARCH 2010
2010 2009
£ £
Fixed assets
Intangible assets 724,690 0
Tangible assets 122,816 137,941
Investments 38,567 555,327
886,073 693,268
Current assets
Debtors: due after more than 1 year 550,000 300,000
Debtors 2,534,584 4,216,342
Investments 1,998 49,811
Cash at bank and in hand 4,282,998 3,254,523
7,369,580 7,820,676
Creditors: amounts falling due within one year (6,062,656) (6,138,415)
Net current assets 1,306,924 1,682,261
Total assets less current liabilities 2,192,997 2,375,529
Capital and Reserves
Called up share capital 120,738 121,263
Share premium account 1,293,347 1,261,997
Employee Benefit Trust share reserve (522,480) 0
Other reserve 264,403 38,512
Profit and loss account 1,036,989 953,757
Shareholders' funds 2,192,997 2,375,529
The financial information set out herein in respect of the years ended 31 March 2010 and 31 March
2009 does not constitute the company's financial statements within the meaning of s434 Companies
Act 2006 for those periods but has been derived from the audited financial statements for those
years and the unaudited financial information within the Chairman's Statement in the 2010
accounts. The Company's financial statements for the year ended 31 March 2010 will be delivered to
the Registrar of Companies shortly. The auditors have reported on those accounts; their report was
unqualified and does not contain statements under s498 (2) or (3) Companies Act 2006
The financial statements, including comparative figures, reflect the activities of the solus
company; group financial statements are no longer required.
The Directors of ANS Group are responsible for the contents of this announcement.
ENQUIRIES
ANS GROUP PLC
Scott Fletcher, Chairman
TEL: 0161 227 1000
scott.fletcher@ansgroup.co.uk
St Helens Capital Partners LLP
Tel: 020 7368 6959
Mark Anwyl or Duncan Vasey
About ANS Group
Operating in a diverse range of business areas within the public and private sectors, our
technology solutions help simplify business challenges. Our Infrastructure 3.0 architecture is set
to transform the future of IT networks, using next generation technology to streamline and unify
the infrastructure. As one of the only companies to hold the necessary specialisations with
Cisco, VMware and NetApp, ANS is uniquely positioned to deliver this unified infrastructure,
helping clients achieve a higher level of performance, at a much lower cost.
Based in Manchester, ANS Group delivers consistently high levels of customer service through all
project deployments and on-going support to its 400 plus client base. As an award winning business
and with our impressive portfolio there comes huge reassurance that you will be working with
people who fully understand the growing range of technology solutions, giving you the confidence
that your IT network and your business will be in the safe hands of infrastructure and technology
solutions experts.