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Vocalis Group plc Preliminary ResultsFor the Year Ended 31st March 1999 Vocalis Group plc ("Vocalis" or the "Group"), the Cambridge based speech recognition telephony company, today announces its preliminary results for the year ended 31st March 1999. Highlights of the results include:
Financial highlights include:
Commenting on the results and future prospects, Roy Cotterill, Chairman of Vocalis, said: "We have ended the year in a strong position to take us forward into new and exciting areas despite adverse external trading conditions experienced at times during the year." "Given the expected explosive growth in speech recognition technologies, the changes in strategy we have put in place, and the money raised, we believe we are very well positioned for the future. We will continue to concentrate all our efforts in our core technologies of speech recognition and to capitalise on the opportunities that are clearly emerging. With the energy, ability and commitment of our staff we look to the future with confidence and we will pursue our business with aggressive enthusiasm." For further information please contact:
NOTES TO EDITORSResults: Group revenue was £4.8m during the financial year under review, compared with £6.2m in 1998. As noted in the trading statement issued by the Group in October 1998, trading conditions in the telecommunications market in general and the Far East in particular deteriorated in the first half of the year. As a result, the level of sales originally anticipated was not achieved. Operating expenses, however, were reduced to £3.7m from £4.1m last year, and as anticipated the Group reports a loss of £1.1m for the year. Company Background: Vocalis was formed in May 1993, via a management buyout from Logica plc, and floated on the London Stock Exchange in July 1996. Vocalis is the only British speech recognition solutions company, servicing an international client base from its Cambridge headquarters. Vocalis develops, manufactures and delivers telephony solutions for corporate call centres and public network operators, using its proprietary speech recognition technology, Vocalis SpeechWare . New Market Strategy: After streamlining its existing product set in the early part of last year, the company will move forward into new areas as well as continuing to exploit the ones in which it already operates. These new areas are:
Partnerships: Existing partnerships with EricssonTelecom AB and Logica plc continue to grow and develop. Significant new business for telecommunications operators has come as a result of the relationship with the former. Additionally the group has signed agreements with Dialogic Corporation and Natural Micro Systems for the deployment of Vocalis SpeechWare. Research and Development: Vocalis continues to invest in the research and development of its core speech recognition technology, Vocalis SpeechWare, as well as SPEECHtel, ENtelAgent, and their associated applications. In addition, Vocalis plays an active role in several European Union research projects including: PICASSO (caller verification for telephone based transactions, which is being developed with, amongst others, the Nationwide Building Society); REWARD (advanced multi-lingual business applications, which is being developed with Taylor Nelson Sofres); Speech-DAT (collection of speech samples to form speech databases); and DISC (standards for spoken language dialogue systems). New Sales Director: Peter Hauser is appointed today (9 June 1999) from Premisys where he was Vice President international sales and marketing. Placing and Open Offer: On 21st May Vocalis announced the completion of a successful placing of 10,920,202 shares at 85p per share. The funds raised will be used primarily to market and further develop enhanced versions of SpeecHTML and secondly to finance the future development and marketing of Vocalis other speech recognition products: Vocalis SpeechWare, SPEECHtel and ENtelAgent. Preliminary StatementReview of Results As expected, Group revenue was £4.8 million during the financial year under review, compared with £6.2m in 1998. The loss after tax and interest was £1.1 million, compared to a profit after tax and interest of £32,000 last year. As noted in the trading statement issued by the Group in October 1998, trading conditions in the telecommunications market in general and the Far East in particular deteriorated in the first half of the year. As a result, the level of sales originally anticipated was not achieved, reflecting clearly the lumpy nature of our business, based on our historic product range. Operating expenses, however, were reduced to £3.7 million from £4.1 million last year, and as anticipated the Group reports a loss of £1.1 million for the year. New Market Strategy After streamlining our existing product set in the early part of last year we formulated a new market strategy. This strategy will take the company forward into new areas, as well as continuing to exploit the ones in which we already operate. Also, it should bring a more regular income. We are pleased to announce today that Peter Hauser was appointed as Sales Director. Peter Hauser joins Vocalis from Premisys where he was VP of international sales and marketing. Prior to this he has had several senior appointments in international sales roles all with companies in various technology fields. New Initiatives In the early part of the year we reviewed the companys market strategy and as a result decided to concentrate on developing three additional opportunities, SpeecHTML, ENtelAgent and Vocalis SpeechWare. It became clear at this time that though we had sufficient funds to continue development of our existing business, further funding would be required to ensure rapid product development to capitalise on the newly defined opportunities. We are delighted to report that we have been successful in raising the sum of £8.7m, net of expenses by way of a placing and open offer. SpeecHTML: one constraint on the massive potential of the Internet is the number of computers available to the population or their immediate access. But with SpeecHTML every Internet Website host could make each site available to every person with access to a telephone. The concept of Web interactive voice response where visitors to a Website can hear its content and interact with it using their voice is gaining a significant amount of interest. Vocalis SpeecHTML is a product capable of this by interpreting standard HTML over the telephone. Registering for a SpeecHTML licence can be done quickly and easily just by entering the company details onto the SpeecHTML Website. A telephone number is generated that will link specifically with the designated Website. We have had a pilot service operating in the UK and planning for the installation of a pilot in the USA is well under way. Following completion of the pilot we have now fully launched the commercial service in the UK. A number of other vendors have recognised this opportunity but they require the Website owner to learn a new language to program their system. SpeecHTML allows Website owners to have all the benefits of this service using their existing HTML language. SpeechMail: Launched on 25th May 1999 Vocalis's SpeechMail offers people access to their e-mails from any telephone. Using spoken commands, the mailbox can be managed without the need for a computer or direct Internet Access. ENtelAgent: This opportunity lies in the development of "path-finder" speech utilities which will provide a compelling reason for our corporate market, regardless of industry type, to purchase them for their telephone call handling requirements. An example utility is the capability of ascertaining, from a population of as many as 20 million, who the incoming caller is (regardless of where the call is being made from) and presenting the information to call centre agents, making significant improvements in overall productivity. We expect to bring this product to market in the coming year. Vocalis SpeechWare: As speech recognition becomes a more widely adopted technology, a growing number of systems integrators, both large and small, are experimenting and building their own applications and products. Whilst continuing to maintain a reputation for leading edge technology and providing specialist service and support through our SPEECHtel and ENtelAgent products, we will offer our core speech recognition technology, Vocalis SpeechWare, to address this gap in the market. Vocalis SpeechWare is our highly featured, speech recognition technology that will offer ease of use to the developer community. New Technology We have continued to develop the core speech recognition technology in line with the requirements of our products. We have introduced a variety of new speech models suitable for different languages; many of these models are now in use around the world. We are constantly working on improvements to processes and techniques that will improve our core technology. The growth in the power of microprocessors is such that techniques and algorithms that in the past could only be used in laboratory research are now being deployed in the field. We have introduced new algorithms which give us the ability to recognise even larger vocabularies. Other improvements to our processing techniques, as well as making use of the increasing power of the processors we use, have enhanced the performance of systems in noisy and otherwise adverse environments. Partnerships We continued to generate significant new business from our existing partnership with EricssonTelecom AB for telecommunications operators. Further product development to support international telecommunications standards has increased the appeal of SPEECHtel to other non-Ericsson operators and switch vendors. In the enterprise applications, we continued to do business with another established partner, Logica plc. We are working to increase our channels to market and, to that end, we have signed agreements with Dialogic Corporation and Natural Micro Systems, for deployment of Vocalis SpeechWare, our packaged speech recognition technology. The coming year should see the first sales fulfilled. EU projects Vocalis continues to play a leading part in European Union sponsored research projects. New projects started this year include PICASSO, in which our speaker verification algorithms are being tested in a variety of environments. Nationwide Building Society is taking part in this project and will be using our technology to provide a security check on customers before they can make a telephone transaction. As the REWARD project comes to an end, the results and findings from the trials that have been run are now being collated and summarised. All the results will be shared by the partners involved in the project. This will help us to create more sophisticated telephone marketing systems. As part of our constant mission to collect up-to-date databases we are taking part in SPEECHDAT Car, which aims to build a European speech database for the mobile environment. Collection for this is underway and should be completed towards the end of this year. Delivered Solutions Given our new market strategy and focus on four specific product areas all resources are now being concentrated on these four specific product areas outlined in our new market strategy. This has resulted in a major internal re-organisation of product development activities. Adopting a modular format to delivery enables us to have a more scalable approach. The streamlining of operations enables increased focus on product and market opportunities that are presented. By putting systems in place that enable the fast development and implementation of production we reduce lead times and increase our speed to market. One of the early successes of this reorganisation has been the recent release of a standard configuration of SPEECHtel. Our new offering supports the latest industry standard for telecommunications interfaces and is therefore easy to integrate into an existing telecommunications operator with a compatible network. We have delivered this configuration to two commercial sites this year and have an expectation of further business from both these customers and other sites. A large extension to an existing installation was completed this year. This site in Mexico, we believe, represents the largest deployment of a speech-enabled Intelligent Peripheral in the world. This further proves that our products are capable of large mission critical deployment. The Future Given the expected explosive growth in speech recognition technologies, the changes in strategy we have put in place, and the money raised, we believe we are very well positioned for the future. We will continue to concentrate all our efforts in our core technologies of speech recognition and to capitalise on the opportunities that are clearly emerging. We will continue to focus our efforts on being cost effective and developing innovative products to ensure we are in a leading position in this dynamic marketplace. With our new strategy in place, which is already showing positive signs, we are confident that Vocalis is at the leading edge of developments in the speech recognition market.
Consolidated Profit and Loss Account
|
1999 |
1998 |
||||
£000 |
£000 |
||||
Turnover | 4,820 |
6,232 |
|||
Cost of sales | (2,395) |
(2,226) |
|||
Gross profit | 2,425 |
4,006 |
|||
Other operating expenses | (3,659) |
(4,063) |
|||
Operating (loss) | (1,234) |
(57) |
|||
Bank interest receivable | 152 |
129 |
|||
Interest payable | (16) |
- |
|||
(Loss) profit on ordinary activities before tax | (1,098) |
72 |
|||
Taxation | - |
(40) |
|||
(Loss) profit on ordinary activities after tax and retained (loss) profit for the year | (1,098) |
32 |
|||
(Loss) earnings per share - pence | (3.36) |
0.10 |
|||
Diluted (loss) earnings per share - pence | (3.36) |
0.10 |
|||
The loss for 1999 and the profit for 1998 arise from continuing operations. | |||||
Statement of total recognised gains and losses for the year ended 31st March 1999 |
|||||
1999 |
1998 |
||||
£000 |
£000 |
||||
(Loss) profit for the year | (1,098) |
32 |
|||
(Loss) gain on foreign currency translation | (18) |
15 |
|||
Total recognised (losses) gains for the year | (1,116) |
47 |
Balance Sheet as at 31st March 1999
Group |
Group |
Company |
Company |
|
1999 |
1998 |
1999 |
1998 |
|
£000 |
£000 |
£000 |
£000 |
|
Fixed assets | ||||
Intangible assets | 92 |
126 |
- |
- |
Tangible assets | 650 |
562 |
- |
- |
Investments | - |
- |
1,761 |
1,761 |
742 |
688 |
1,761 |
1,761 |
|
Current assets | ||||
Stocks | 377 |
408 |
- |
- |
Debtors | 1,058 |
1,597 |
4,614 |
4,469 |
Cash at bank and in hand | 2,704 |
2,820 |
- |
- |
4,139 |
4,825 |
4,614 |
4,469 |
|
Creditors: amounts falling due within one year | (2,271) |
(1,983) |
(512) |
(421) |
Net current assets | 1,868 |
2,842 |
4,102 |
4,048 |
Total assets less current liabilities | 2,610 |
3,530 |
5,863 |
5,809 |
Creditors: amounts falling due after more than one year | (197) |
(55) |
- |
- |
Net assets | 2,413 |
3,475 |
5,863 |
5,809 |
Capital and reserves | ||||
Called-up share capital | 1,638 |
1,622 |
1,638 |
1,622 |
Share premium account | 4,225 |
4,187 |
4,225 |
4,187 |
Other reserves | 1,070 |
1,070 |
- |
- |
Profit and loss account | (4,520) |
(3,404) |
- |
- |
Shareholders' funds - equity interests | 2,413 |
3,475 |
5,863 |
5,809 |
Consolidated Cash Flow Statement for the year ended 31st March 1999
1999 |
1998 |
|
£000 |
£000 |
|
Net cash (outflow) inflow from operating activities | (217) |
164 |
Returns on investments and servicing of finance | ||
- interest received | 152 |
129 |
- interest element of finance lease rentals | (16) |
- |
Net cash inflow from returns on investments and servicing of finance | 136 |
129 |
Capital expenditure and financial investment | ||
- purchase of tangible fixed assets | (340) |
(346) |
- purchase of intangible fixed assets | (16) |
(138) |
Net cash (outflow) from capital expenditure and financial investment | (356) |
(484) |
Cash (outflow) before management of liquid resources and financing | (437) |
(191) |
Management of liquid resources | ||
- decrease in short term deposit | 200 |
400 |
Financing | ||
Secured loan | - |
55 |
Funds received from sale and leaseback transaction | 294 |
- |
Issue of ordinary shares | 54 |
54 |
Repayment of secured loan | (2) |
- |
Capital element of finance lease repayments | (25) |
- |
Net cash inflow from financing | 321 |
109 |
Increase in cash in the year | 84 |
318 |
The financial information set
out above does not comprise the company's statutory accounts.
Statutory accounts for the previous financial year ended 31 March
1998 have been delivered to the Registrar of Companies. The
auditors' report on those accounts was unqualified and did not
contain any statement under section 237(2) or (3) of the
Companies Act 1985. The auditors have not yet reported on
accounts for the year ended 31 March 1999, nor have any such
accounts been delivered to the Registrar of Companies
About Vocalis
Vocalis works with organisations to create contact centre solutions that build the organisations business and brands. These solutions can turn your contact centre from a cost to a profit centre by ensuring it builds your brand, helps your business be more competitive, and increases customer loyalty through more effective and efficient service. Vocalis was formed in 1993, is publicly traded on FTSE Stock Market and has been listed since July 1996. Vocalis brings back the reassurance of the most personal human touch in business - putting voice to work.
The Vocalis Website is at
Email: [email protected]
For further Vocalis Group information, contact:
Philippa Buttle |
Vocalis Group plc |
Chaston House
Mill Court Gt Shelford Cambridge CB2 5LD |
Tel: 01223-846177 |
Fax: 01223-846178 |
Email:[email protected] |