Delcam Plc Preliminary Report 2000


Preliminary Results for the year ended 31 December 2000

Delcam produces record sales and return to profit for the second year running

2000 1999
Sales £17.0m £15.8m +8%
Pre-tax profit £1.6m £1.0m +58%
Earnings per share 20.2p 13.5p +50%
Final dividend 2.40p 1.80p +33%
Total 3.25p 2.50p +30%

  • The results showed the effects of the strong trading in the second half which delivered £1m in pre-tax profit.
  • 2000 saw £3.6m spent on R & D and the introduction of new versions of the Group's key software products, which have received positive reactions from our customer base.
  • Strengthening and additions to the overseas reseller chain bodes well for the future sales.
  • Operating margins, earnings and dividends all strongly ahead and strong cash generation enabled a net cash inflow from operating activities of £2.3m.
 

"The good progress, both technically and commercially, experienced in 1999 has continued during 2000. This continued improvement is a testament to the exceptional efforts of all our employees and to the loyalty and hard work of our Sales Partners. The slowdown in the USA and the problems of the Japanese economy must have an impact on world trade from which we cannot be isolated if these economic trends continue. Nevertheless with a series of new software releases planned for this year, together with significant enhancements to our existing products and continuing investment in our sales channels, we remain confident in our competitive position."

Tom Kinsey, Chairman

FULL STATEMENT ATTACHED

STATEMENT BY THE CHAIRMAN, TOM KINSEY

Financial Highlights

As I predicted in my interim statement on 30 August 2000 the improvement in trading experienced over the past eighteen months has continued in the second half of this financial year.

Sales for the year to 31 December 2000 were £17.0 million compared with £15.8 million during 1999, an increase of 8%. Sales of software and services have risen by 18%, while lower hardware prices have contributed to a 15% decline in the less-profitable revenue from hardware sales.

Profit before tax of £1.6 million represents an improvement of 58% from the profit in 1999 of £1.0 million. Basic earnings per share were 20.2p compared with 13.5p in the previous year. A combination of strong cash generation and strict cash control have enabled a net cash inflow from operating activities of £2.3 million to be generated over the full year.

Dividend

In view of the improved performance, the Board proposes to pay a final dividend of 2.4p per ordinary share (1999 - 1.8p). With the interim dividend of 0.85p, this makes a total for the year of 3.25p (1999 - 2.5p) being a 30% increase in the year. This is covered 6.2 times by earnings in the financial year. The final dividend will be paid on 11 May 2001 if approved at the AGM on 1 May 2001 to shareholders on the Register on the close of business on 6 April 2001.

The shares are expected to be quoted ex dividend on 4 April 2001.

Review

Delcam has continued its progress as the leading international supplier of complete, automated CADCAM systems for the design, manufacture and inspection of complex shapes, spending £3.6 million on R & D in the year. We have continued to expand our customer base outside our traditional toolmaking market, and to reduce our dependence on the automotive industry. We have enjoyed increased success in aerospace components, housings for mobile phones and other electrical appliances, sports equipment and footwear. Demand for our CADCAM solutions is growing rapidly in these industries as a result of the desire for more complex designs in many consumer products and because of the increasing rate of styling modifications to meet changing fashions. Increased expenditure on marketing has enabled us to continue to improve our brand recognition and our products are now well established in our target markets worldwide.

The second half of the year has seen the introduction of new versions of all of our key products. The response from our customer base has remained extremely positive throughout the year, with revenue from support and software maintenance rising by over 20% compared to 1999, which represents 17% of our total turnover.

Work is now under way on major releases of our two key products - the design software PowerSHAPE and our machining software PowerMILL. The new release of PowerSHAPE will further strengthen our ability to compete in the concept design area, as well as in our traditional design for manufacture field. The forthcoming version of PowerMILL will reinforce our leading position in more demanding machining operations, such as high-speed machining and five-axis machining.

The distribution and development agreement that was signed with the leading metrology company, Renishaw plc, has boosted the revenue generated from our CopyCAD reverse engineering technology. Similarly, the arrangements for measuring equipment manufacturers to supply our inspection software, PowerINSPECT, with their products have continued to work successfully and are expected to be extended during this year. Equally, the sales of our ArtCAM engraving and signmaking software through equipment supplier, Modelmaster, continued to provide a strong base for revenue growth from this product during the year.

During this year, we will launch PS-Team, a new web-based task management system that can improve communication and collaboration both within a single company and along the supply chain.

Prospects

The good progress, both technically and commercially, experienced in 1999 has continued during 2000. This continued improvement is a testament to the exceptional efforts of all our employees and to the loyalty and hard work of our Sales Partners.

The slowdown in the USA and the problems of the Japanese economy must have an impact on world trade from which we cannot be isolated if these economic trends continue. Nevertheless with a series of new software releases planned for this year, together with significant enhancements to our existing products and continuing investment in our sales channels, we remain confident in our competitive position.

22 March 2001

Download the full report including the Chairman's Statement, Consolidated Profit and Loss, Consolidated Balance Sheet and Consolidated Cash Flow for Adobe Acrobat.

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