Print   

25 July 2008

NETWORK TECHNOLOGY PLC

Final Results for the year ended 31 March 2008

Results

I am pleased to announce a fourth profitable year, with profit before tax of £55,000 compared to £50,000 in 2007. Operating profit increased to £134,000 (2007: £126,000) with continued investment in marketing activities in Asia and Pacific. We continue to benefit from this investment and anticipate further growth in sales over the coming years. Turnover for the year amounted to £2.19 million, slightly down on the previous year (2007: £2.47 million) due to a sharp decrease in legacy Token Ring and Twinax products which was almost fully compensated by increased sales of our FollowMe and Access Control product lines. Operating costs decreased by 12% to £1.39 million. Earnings per share increased to 2.7p (2007: 2.4p).

The Directors are unable to recommend the payment of a final dividend for the year. However, the Directors are continuing to consider a share capital restructuring to permit the payment of dividends.

The Company continued to focus on marketing activities, building a stronger sales team and developing its channels for its FollowMe® and Access Control products. As a result, our order book at the end of June 2008 was US$ 0.4 million.

Bank borrowings for the Group remain low, totaling £198,000.

Product Development

The Company has continued to generate further interest in its main product lines:

• FollowMe® Printing is a Printer Access Control and Accounting system which addresses issues like security, availability, print-data encryption, access to colour printers, copier fax and email facilities on Multi Function Printers as well as ordinary printers and copiers.

Among other applications, the system is an important element in efficient routing of documents, reducing waste, managing energy use, protecting companies from breaches that might violate Sarbanes-Oxley or similar legislation affecting many large corporate users based in, or doing business with, the US or Japan.

• Networked Access Control Systems and Time and Attendance Terminals seamlessly integrate almost all existing identification technologies such as swipe cards, proximity cards, barcodes but also fingerprint and face recognition. This product incorporates our own algorithms, which not only make us independent of any particular reader or ID technology but also ensures its efficiency when used with a larger number of people.

• The Networked Fax Receiver is a network appliance that converts an incoming fax directly into an email so it arrives instantly in an email inbox improving delivery and enabling it to be efficiently forwarded as well as reducing waste from Spam faxes.

DocuSender™ is a network appliance that allows a USB scanner to capture a document and send it to a Fax machine via its built in fax modem, to an email address or to an application. Users can select from a large range of Visoneer, Xerox, Fujitsu or HP USB connected scanners the one that is best suited for their application.

Corporate Activity 

During the year we have been focusing on making additions to our pre-sales support team to deal with an ever increasing number of projects as well as increasing sales prospects throughout the Group. For those shareholders who follow the RNS service of the London Stock Exchange, you will know that we have signed a new agreement with Toshiba Corporation USA and became a technology partner to Ricoh Corporation in USA, to further assist in strengthening our OEM business in Japan. 

We have continued to strengthen our sales teams in the US and UK, as well as making major efforts to secure new customers and channels in the Asia, Pacific and Oceania region for our FollowMe product. 

We will keep shareholders informed of developments within the company. Market sensitive data will be published through the RNS service of the London Stock Exchange. Further information can be found at our website www.network-technology.com which also provides a direct link to either LSE market data for NTY or Yahoo market data.

Copies of the 2008 Report and Accounts will be sent to shareholders in due course. Further copies will be available from the registered office of Network Technology PLC, 26 Victoria Way, Burgess Hill, West Sussex, RH15 9NF.

Guidance to the Market

The Company currently has firm orders of US$ 0.4 million for delivery within the next 24 months.

We continue to focus on the development of revenues from our product base and are encouraged by the response that we are getting in new geographic markets including Central and South America, the Arab Peninsula and Asia Pacific. Further improvement and development of our product range should be covered by cash generated within the Company.

Klaus Bollmann

Chairman, Network Technology Plc

25 July 2008

  

NETWORK TECHNOLOGY PLC
YEAR ENDED 31 MARCH 2008
CONSOLIDATED INCOME STATEMENT
		Year ended 31.03.08				Year ended 31.3.07
		£'000				£'000
Revenue		2,195				2,472
Cost of Sales		(667)				(723)
Gross Profit		1,528				1,749
Other operating expenses		(1,394)				(1,623)
Other operating income		0				0
Profit from operations		134				126
Investment income		0				0
Finance costs		(29)				(30)
Profit before tax		105				96
Tax charge		(50)				(46)
Profit for Year from Continuing  Operations		55				50
Earnings per ordinary share in pence  Basic and Diluted		2.7p				2.4p

NETWORK TECHNOLOGY PLC
YEAR ENDED 31 MARCH 2008
BALANCE SHEET
								31 March 2008				31 March 2007
										£'000				£'000
Assets
Non Current Assets
Property, plant and equipment										223				302
Investments										40				28
Development costs										794				625
Deferred tax asset										66				98
										1,123				1,053
Current Assets
Inventories										898				943
Trade and other receivables										581				532
Cash and cash equivalents										35				18
										1,514				1,493
Total Assets										2,637				2,546
Current Liabilities
Trade and other payables										1,222				1,133
Bank overdrafts and loans										159				213
										1,381				1,346
Non Current Liabilities
Other Loans										547				544
Total Liabilities										1,928				1,890
Equity
Called up share capital										4,112				4,112
Share premium account										8,028				8,028
Currency translation reserve										(68)				(54)
Capital redemption reserve										12				12
Revaluation reserve										12				-
Profit and loss account										(11,387)				(11,442)
Total Equity										709				656
Total Liabilities and Equity										2,637				2,546

YEAR ENDED 31 MARCH 2008
CASH FLOW STATEMENT
				31 March 2008					31 March 2007
						£'000						£'000
Operating Activities						330						383
Investing Activities
Payments to acquire tangible fixed assets						(11)						(45)
Payments to acquire intangible fixed assets						(251)						(316)
Payment to acquire investments						0						-
						(262)						(361)
Financing Activities
Repayment of borrowing						(37)						(69)
Increase/(decrease) in bank overdrafts						(14)						47
Proceeds from borrowings						-						-
						(51)						(22)
Cash and cash equivalents at beginning of period						18						18
Bank Balances and Cash						35						18

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

	Share Capital £'000	Share Premium £'000	Other Reserves £'000	Foreign Currency Translation Reserve £'000	Revaluation Reserve   £'000	Retained Losses £'000
At 1.4.07	4,112	8,028	12	(54)	-	(11,442)
Retained profit for the year	-	-	-	-	-	55
Exchange gain on translation	-	-	-	(14)	-	-
Revaluation	-	-	-	-	12	-
At 31.3.08	4,112	8,028	12	(68)	12	(11,387)

NOTES 

1. Basis of Preparation

The accounts were prepared under International Financial Reporting Standards (IFRS). The comparative figures for the year to 31 March 2007 do not constitute full accounts within the meaning of Section 240 of the Companies Act 1985. Full accounts for that period, which received a qualified audit report containing a statement under Section 237(3) of the Companies Act 1985, have been delivered to the Registrar of Companies. The financial information set out in the preliminary statement of results for the year ended 31 March 2008 does not constitute statutory accounts within Section 240 of the Companies Act 1985. 

The audit report to the statutory financial statements will contain a qualified opinion arising from a limitation in scope in respect of the realisable value of inventory at 31 March 2008. The audit report attached to the statutory financial statements for that year contains a statement under Section 237(3) of the Companies Act 1985. It does not contain a statement under Section 237(2) of that Act. 

2. Going Concern 

The statutory financial statements have been prepared on a going concern basis. The ability of the group and company to continue as a going concern is based upon:

 

On the basis of the current financial projections the directors have a reasonable expectation that the group and company have adequate resources to continue in operational existence for the foreseeable future.

3. Earnings per Share

The calculation of basic earnings per ordinary share is based on the profit for the year after tax of £55,000 (year to 31 March 2007: of £50,000). 

Earnings per share have been calculated using the weighted average number of ordinary shares in issue during the year. The weighted average number of equity shares in issue is 2,055,971 (2007: 2,055,971). 

The Basic and Diluted earnings per share figures are the same because the average market price of the ordinary shares during the period did not exceed the exercise price of the equity options in existence at the balance sheet date. 

ENDFR UVURRWVRBUAR