Vianet Group plc (AIM: VNET), the international provider of actionable data and business insight through devices connected to its Internet of Things ("IOT") platform, is pleased to announce its final results for the year ended 31 March 2018.
Financial highlights (continuing operations)
- Revenue for the year of £14.56 million (2017: £14.26 million)
- Smart Machines adjusted operating profit of £1.07 million, including Vendman contribution of £0.12 million grew 20.1% from £0.89 million (up 6.7% excluding Vendman)
- Recurring revenues remain strong at 90% (2017: 85%) helped by the Vendman acquisition in October 2017 and transition from capital to annuity based sales in Smart Machines
- Gross margin stable at 70% (2017: 70%)
- Operating profit pre-amortisation of intangibles, share options and exceptional costs up 9.2% to £3.62 million (2017: £3.32 million)
- Profit before taxation was up 41.5% to £2.05 million post exceptional items (2017: £1.45 million)
- Operating cash generation of £2.97million (2017: £3.93 million)
- Net cash of £1.2 million (2017: £3.45 million) post acquisition of Vendman
- Basic earnings per share (before tax) and post-exceptional costs at 7.42 pence (2017: 5.30 pence)
- Final dividend of 4.00 pence per share proposed giving a full year total of 5.70 pence per share (2017: 5.70 pence)
- Acquisition of Vendman Systems Ltd, the UK's leading unattended retail management software company for a total consideration (including earn-out), of up to £4.25 million, payable in cash
- Smart Machines contract win for pan European and ANZ operations of a leading international coffee company with roll out commencing in 2018/19
- Smart Zones Division resilient with 245 new drinks monitoring system installed, offsetting some of the impact of pub closures
- Smart Machines Division added 4,490 new connected devices excluding Vendman (2017: 5,092) and increased underlying profitability by 6.7%
- £2.0 million investment in cloud and mobile technology to modernise the Smart Zones platform and support growth in the Smart Machines division
Commenting on the final results, James Dickson, Chairman of Vianet Group plc, said:
"Vianet has made significant steps towards the delivery of its earnings transformation plan and continues to benefit from its focus on exploiting growth opportunities in the Smart Machines division whilst optimising performance in the Smart Zones division. The Group has a proven track record of converting data from its IOT connected devices into actionable information and solutions for b2b markets. We continue to develop and grow our working relationships with our blue-chip customer base where contracted recurring revenues now represent over 90% of turnover.
The acquisition of Vendman with c. 200,000 mobile connections and roll out of the recently won global coffee contract, is expected to be transformational for the Smart Machines division and should drive significantly increased earnings for the Group in the next few years.
The Group has high levels of recurring income, strong cash flow and a healthy balance sheet, which means we are well placed for further investment to accelerate Smart Machines expansion and for selective acquisitions.
The Board is confident that the Group's long term strategy is the right one and that it is positioned to deliver earnings growth and expand future strategic options."