AUDITED FINAL RESULTS 2016
The Directors of
Financial and Operational Highlights
The year under review has seen a number of significant achievements:
- Revenue up by 20% to £3.25 million;
- Number of CCGs contracted increased to 40;
- Debt reduced and healthy cash balance of £300,000 at year end;
- Three R&D projects have now reached Pilot phase including major development to core product
DXS Pointof Care;
Commenting on the results
"The year under report has been challenging, principally as a result of changes within the NHS funding regime, but the Company has continued to grow revenues and maintained its commitment to continual improvement and innovation. The Company is also preparing a major updated version of
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The following information has been extracted from the Company's audited accounts for the year to
The Directors of
We are pleased to report that the year ending
- Revenue grew by 20% compared with 2015.
- Three of DXS's R&D projects have now reached Pilot phase. These are the Personal Care Record, the Interactive
Patient CarePathway and the DXS Referral Management solution.
- New partnerships and collaborations are being formed with providers of additional healthcare functionality. These include the provider of the Personal Care Record, the provider of the Patient Care Pathway, the provider of Medical Devices that integrate into the Personal Care Record, and Kinesis, a solution that enables Consultants to provide virtual opinions on patients on behalf of GPs.
DXS Pointof Care, our generic solution, delivers considerable ROI for its clients: one study showed a £2.7 million reduction in referral costs achieved over a twelve month period.
Revenue grew from £2,723,762 at
To mitigate the NHS budget cuts, DXS is focusing on accessing new revenue sources coupled with new and innovative solutions. These are:
- Personal Care Record - The personal care record enables a patient to enrol via
DXS Pointof Care in a GP Practice which will provide the patient with full access to their medical records via an app on their mobile device. The system will automatically detect, for example, that a patient is a diabetic and then send the patient reminders for requisite tests such as blood pressure checks, foot health checks etc that become due. This is in line with NHS priorities and a new budget of £40 million has been made available to CCG's beginning in 2017 to fund a Diabetes initiative.
- Personal Care Pathway - DXS has been working on this solution for approximately three years. This is a complex algorithmic engine that will assess a patient in relation to a recommended treatment protocol and alert clinicians of actions to implement to ensure treatment compliance.
- DXS Referral Management solution - This is an enhancement to the existing
DXS Pointof Care referring functionality. This area is high on the NHS agenda and DXS are about to pilot our new referring workflow solution. As noted above, the existing payback for users is exceptional and the enhancement will reduce unnecessary referrals to an even greater extent.
- DXS Innovation - This is an initiative where various medical devices are integrated with the Patient's personal care record providing valuable data, such as blood pressure, seamlessly into the patient's personal care record.
- DXS has during the past year ensured that it meets the required levels of conformance which include customer support, content management, clinical safety and disaster backup and management.
Our cash position remains positive and at the year end, cash at bank stood at £315,000.
The audited profit for the year ending
While NHS cuts have seen the company's revenue growth slowed, to an estimated 10% for the year ending
I particularly want to thank all DXS staff for their ongoing effort and contribution to ensuring that DXS has achieved FRA and in parallel grown the revenue by a significant margin.
REPORT OF THE DIRECTORS
The directors present their annual report and the audited financial statements for the year ended
The directors for the year were:
D Immelman - CEO
S Bauer - MD
B Sutcliffe - Chair
The group's principal activities during the period were the development and distribution of clinical decision support to General Practitioners, Nurses and Retail Pharmacies in the
Failure to achieve predicted quantities of DXS contracts, particularly due to NHS budget cuts, and slower development of additional revenue streams may result in revenues growing more slowly than anticipated.
At this stage the Group is not faced with risk relating to interest rates on loans, credit and liquidity.
The Directors do not recommend a dividend.
Research and Development
The Company continues to invest into research and development both locally and internationally. With the rapid emergence of CCGs in the
The directors are responsible for preparing the financial statements for each financial year. The directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
- Select suitable accounting policies and apply them consistently.
- Make judgments and accounting estimates that are reasonable and prudent.
- State whether
UKaccounting principles have been followed subject to any material departures disclosed and explained in the financial statements and,
- Prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in the business.
The directors are responsible for keeping proper accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The directors have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company's auditors are aware of that information.
Approved by the board and signed on its behalf by:
D A Immelman
Review of the Company's Business
The Company has managed to grow revenues from £2,723,762 at
The Company managed a profit of £219,089 even after the write off of £54,000 for a "share option valuation". This charge has been provided in terms of current Accounting Standards.
After significant investment of our limited resources it has been frustrating to have the NHS cut budgets for the GPSOC initiative. However the company has been seeking alternative revenue streams for its offering to the
While the foregoing has resulted in slower than expected revenue growth, management are optimistic about new opportunities going forward.
Description of Principle Risks and Uncertainties
The principle risk is that a competitor provides the market with a superior Clinical Decision Support Solution and takes market share from DXS. To mitigate this risk DXS continually meets the dynamic needs of its customers through a program of R&D.
A second risk is that of CCG budgets drying up.
Analysis of Business during Year Ending
Sales growth of 20% was below expectations due to NHS budget cuts. The company is also still waiting for GPSOC to provide DXS with access to a compliant API which will add in excess of £100,000 to our bottom line. The reason is that we still are but not meant to be paying Clinical Systems royalties for access to patient records.
The staff headcount, including freelancers, is approximately 80 and this is considered sufficient for current requirements.
During the past year the Company continues to meet its obligations in terms of its systems and robustness, dictated by NHS requirements. This should continue to offer any customer, whether in the
Group Revenue £3,255,081 an increase of 20%. Definition:
Underlying Group Profit After Tax has declined and this reduction in annual profit from the previous year is largely caused by the write off of deferred development expenditure included in Administrative Expenses. A required write off of £54,000 for a management share option valuation has also been deducted at arriving at the profit- Definition: Underlying profit provides information on the underlying performance of the business adjusting for either income or charges which are both one off or significant.
Earnings Per Share 2016 0.7p, 2015 0.9p. Definition: Earnings per share is the underlying profit divided by the average number of ordinary shares in issue.
ROCE 2016 13%, 2015 18%. Definition: Return on capital employed (ROCE) is the ratio of net operating profit of a company to its capital employed. It measures the profitability of a company by expressing its operating profit as a percentage of its capital employed.
Approved by the board and signed on its behalf by:
D A Immelman
CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED
|Cost of sales||(517,991)||(461,608)|
|Provision for costs of share option awards||(54,000)||(108,580)|
|Operating profit/ (loss)||70,804||60,792|
|Interest received and similar income||2,403||2,170|
|Interest payable and similar charges||(27,271)||(35,477)|
|Profit on ordinary activities before taxation||45,936||27,485|
|Tax on Profit on ordinary activities||173,153||272,290|
Profit for the year
|Profit per share -|
|- fully diluted||.6p||.7p|
Statement of Other Comprehensive income for the year ended
|Profit for the year||219,089||299,775|
|Tax on components of other comprehensive income||-||-|
|Total comprehensive income for the year||219,089||299,775|
Statement of Financial Position for the Year Ended
| Debtors: - amounts falling due|
within one year
|Cash at Bank and in hand||315,049||480,928||82,517||287,897|
| Creditors: amounts falling due|
within one year
|Net current assets|| |
|Total assets less current liabilities||2,832,533||2,251,564||1,436,305||1,391,297|
| Creditors: amounts falling due after|
more than one year
|Accruals and Deferred Income||(1,070,844)||(665,081)||-||-|
|Capital and reserves|
|Called up share capital||110,174||108,592||110,174||108,592|
|Provision for costs of share option awards||162,580||108,580||162,580||108,580|
|Shareholders' funds|| |
The financial statements were approved and authorised by the Board on
| D Immelman|
| S Bauer|
|30th September||30th September|
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED
1. Summary of significant accounting policies
a) General information and basis of preparation.
The group's principal activities during the year were the development and distribution of clinical decision support to General Practitioners, Nurses and Retail Pharmacies in the
The financial statements have been prepared in accordance with applicable accounting standards including Financial Reporting Standard 102 Applicable in the
The significant accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all years presented unless otherwise stated. The company adopted FRS 102 in the current year and an explanation of how transition to FRS 102 has affected the reported finance position and performance is given in note 25
b) Intangible assets
Intangible assets acquired separately from a business are capitalised at cost.
Research and development expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.
Intangible assets are amortised over a straight line basis over their useful lives. The useful lives of intangible assets are as follows:
|Intangible type||Useful life||Reasons|
|Development expenditure||5 years from the date that the specific product is completed and available for distribution||Period of time for benefit to be received|
| ||20 years from acquisition of goodwill||Period of time for benefit to be received|
c) Tangible fixed assets
Tangible fixed assets are stated at cost less accumulated depreciation.
Depreciation is provided on all tangible fixed assets at rates calculated to write off the cost, less estimated residual value, of each asset on a systematic basis over its expected useful life as follows:
Plant and equipment 3-4 years straight line
d) Debtors and creditors receivable/ payable within one year
Debtors and creditors with no stated interest rate and receivable or payable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the profit and loss account in other administration expenses
e) Loans and borrowings
Loans and borrowings are initially recognised at the transaction price including transaction costs. Subsequently they are measured at amortised cost using an effective interest rate method, less impairment. If an arrangement constitutes a finance transaction it is measured at present value.
Provisions are recognised when the company has an obligation at the balance sheet date as a result of a past event. It is probable that an outflow of economic benefit will be required in settlement and the amount can be reliably estimated.
Current tax represents the amount of tax payable or receivable in respect of the taxable profit for the current or past reporting periods. It is measured at the amount expected to be paid or recovered using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.
h) Turnover and other income
Turnover is measured at the fair value of the consideration received or receivable net of VAT and trade discounts. The policy adopted for the recognition of turnover is as follows:
i) Foreign currency
Foreign currency transactions are initially recognised by applying to the foreign currency amount the exchange rate between the functional currency and the foreign currency at the date of the transaction.
Monetary assets and liabilities denominated in a foreign currency at the balance sheet date are translated using the closing rate.
The company's principal activities during the year were the development and distribution of clinical decision support to General Practitioners, Nurses and Retail Pharmacies in the
j) Employee benefits
When employees have rendered service to the company, short term employee benefits to which the employees are entitled are recognised at the undiscounted amount expected to be paid in exchange for that service.
The company operates a defined contribution plan for the benefit of its employees. Contributions are expensed as they become payable.
FRS 102 requires that a provision for holiday pay is provided in the annual accounts. This provision, not previously made, was included as an adjustment in the 2015 accounts as provided in terms of the transitional rules of FRS 102.
Rentals payable and receivable under operating leases are charged to the profit and loss account on a straight line basis over the period of the lease
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.