ECsoft Group plc Announces Interim Results 1H 2001.Business Editors LONDON--(BUSINESS WIRE)--July 26, 2001 Highlights - Programmes to increase focus on core markets and partners deliver performance and efficiency improvements in the first half of 2001: - retained profit increased to (pound)1.0m versus 1H'00 loss of (pound)0.5m, - profit before tax increased to (pound)2.8m versus 1H'00 PBT of (pound)0.4m, - operating profit (before goodwill amortisation and exceptional items) rose to (pound)1.3m compared with a 1H'00 loss of (pound)0.5m, - operating margins increased by over 540 basis points to 3.9% versus 1H'00 -1.5%, - fully diluted earnings per share increased to 8.4 pence per share versus 1H'00 loss of 4.2 pence per share; - Cash position improved by 18% to (pound)42.9 million as at 30 June 2001, compared to (pound)36.3 million as at 30 June 2000; - Strategic partnership announcements in the first half 2001 with Pink Elephant, GFI Informatique and iPlanet strengthen ECsoft's market position; - Management and financial controls in place to counter difficult trading conditions. Commenting on the results, Jerry Jer·ry n. pl. Jer·ries Chiefly British Slang A German, especially a German soldier. [Alteration of German. Ellis ELLIS - EuLisp LInda System. An object-oriented Linda system written for EuLisp. "Using Object-Oriented Mechanisms to Describe Linda", P. Broadbery <pab@maths.bath.ac.uk> et al, in Linda-Like Systems and Their Implementation, G. Wilson ed, U Edinburgh TR 91-13, 1991. , Chief Executive Officer of ECsoft Group plc, "In the first six months of 2001, we continued to apply firm and active management to maintain the progressive business recovery initiated during 2000. Against a backdrop Backdrop may refer to:
tr. & intr.v. wors·ened, wors·en·ing, wors·ens To make or become worse. Noun 1. worsening - process of changing to an inferior state decline in quality, deterioration, declension market conditions, we are pleased to have stayed on track in the first half of 2001. These results demonstrate the merit of our decision to increase focus on our core markets, partners and propositions. ECsoft is in a strong position. We have a healthy balance sheet to allow us to respond to opportunities (as evidenced by our recent acquisition in Sweden Sweden, Swed. Sverige, officially Kingdom of Sweden, constitutional monarchy (2005 est. pop. 9,002,000), 173,648 sq mi (449,750 sq km), N Europe, occupying the eastern part of the Scandinavian peninsula. ) and an experienced management team that will continue to respond swiftly to changes in market conditions." ECsoft Group plc ("ECsoft" or the "Company"; London London, city, Canada London, city (1991 pop. 303,165), SE Ont., Canada, on the Thames River. The site was chosen in 1792 by Governor Simcoe to be the capital of Upper Canada, but York was made capital instead. London was settled in 1826. :ECS See eComStation. ; Nasdaq OTC OTC See: Over-the-counter. OTC See over-the-counter market (OTC). :ECSGY) announces interim results for the six months ended 30 June June: see month. 2001. Group turnover for the first half of 2001 was (pound)34.1 million, compared to (pound)34.7 million in the first six months of 2000. ECsoft achieved an organic revenue growth rate in the first six months of 2001 of 3.2%, excluding the effect of divestments and acquisitions. Profit before tax increased to (pound)2.8 million, from (pound)0.4 million in 1H'00. Retained profit increased to (pound)990,000, or 8.4 pence pence n. Chiefly British A plural of penny. pence Noun a plural of penny USAGE: Since the decimalization of British currency and the introduction of the abbreviation p, per share for the first half of 2001, compared to net loss of (pound)491,000, or a loss of 4.2 pence per share for the same period in 2000. All earnings per share figures are calculated on a fully diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. basis. Operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. before goodwill amortisation Noun 1. amortisation - the reduction of the value of an asset by prorating its cost over a period of years amortization reduction, step-down, diminution, decrease - the act of decreasing or reducing something 2. and exceptional items increased to (pound)1.3 million in the first half of 2001, reversing a net operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. of (pound)535,000 for the same period in 2000. Operating margins Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: for the first half 2001 were 3.9%, an increase of over 540 basis points over a first half negative margin of 1.5% in 2000. ECsoft's cash reserves Cash reserves See: Cash investments cash reserves Investment funds that are held in short-term assets such as Treasury bills and certificates of deposit until more permanent investment opportunities are available. increased by 18% to (pound)42.9 million as at 30 June 2001, compared to (pound)36.3 million a year earlier. At the end of June 2001 ECsoft's workforce was 845, down from 1,081 at the start of the year. This reduction is primarily as a result of the divestment divestment to strip one's investment from an entity. of ECsoft UK's Managed Support Division to Pink Elephant (1) (Pink Elephant Inc., The Netherlands, www.pinkelephant.com) An IT service management provider founded in 1979 with operations throughout North America and the Asia Pacific region. in the first quarter and consolidation of the Company's three operations in the Netherlands Netherlands (nĕth`ərləndz), Du. Nederland or Koninkrijk der Nederlanden, officially Kingdom of the Netherlands, constitutional monarchy (2005 est. pop. 16,407,000), 15,963 sq mi (41,344 sq km), NW Europe. . In early July July: see month. , ECsoft acquired the S17 division of Framfab AB in Sweden (originally a division of Guide Konsult AB), containing 63 employees, bringing the total workforce slightly above 900. This acquisition gives ECsoft Sweden access to greater project management and systems integration skills, access to more customers and the critical mass to win and deliver more substantial projects to larger customers. At ECsoft's AGM AGM annual general meeting AGM n abbr (= annual general meeting) → AG f AGM n abbr (= annual general meeting) → JHV f in May 2001, the Board's ability to enact the share buy-back programme was renewed, authorising the Company to acquire up to 1,538,853 of the issued shares, representing approximately 13.2% of the issued share capital as at 29 March 2001. Since that time, the Company has purchased 151,000 of its own ordinary shares for cancellation. The number of ADR ADR - Astra Digital Radio (American Depository Receipt American Depository Receipt n. called in the banking trade an ADR, it is a receipt issued by American banks to Americans as a substitute for actual ownership of shares of foreign stocks. ) holders continues to decrease, currently representing less than 1% of the Company's total outstanding shares. Pursuant to the Company's delisting Delisting When the stock of a company is removed from a stock exchange. Notes: Reasons for delisting include violating regulations and/or failure to meet financial specifications set out by the stock exchange. from Nasdaq in the first quarter of 2001, ECsoft will henceforth From this time forward. The term henceforth, when used in a legal document, statute, or other legal instrument, indicates that something will commence from the present time to the future, to the exclusion of the past. report on a half-yearly Half´-year`ly a. 1. Two in a year; semiannual. Adj. 1. half-yearly - occurring or payable twice each year biannual, semiannual, biyearly basis, consistent with the rules of the UK Listing Authority. The Company will continue to provide trading updates and maintain appropriate visibility and transparency (1) The quality of being able to see through a material. The terms transparency and translucency are often used synonymously; however, transparent would technically mean "seeing through clear glass," while translucent would mean "seeing through frosted glass." See alpha blending. to its shareholders. Focus on core markets Initiated in mid- mid- pref. Middle: midbrain. 2000, ECsoft continues its focus on customer retention and penetration in three core markets: financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. , telecommunications/media/technology (TMT TMT 1 Tarsometatarsal 2 Thermomechanical treatment 3 Treatment, see there ) and the public sector. During the first half of the year, ECsoft won and significantly extended major customer projects in these target markets, which together now represent 72% of the Group's revenue, up from 64% in the first half of 2000. In the area of financial services, ECsoft is working with a number of large institutions such as Den norske Bank Den norske Bank or DnB was a Norwegian bank that existed between 1990 and 2003 when it merged with Gjensidige NOR to form the present DnB NOR. The bank's headquarters were in Bergen, Norway. and Den Danske Bank Danske Bank is a Danish bank. It was founded 5 october 1871 as Den Danske Landmandsbank, Hypothek- og Vexelbank i Kjøbenhavn (The Danish Farmers' Bank, Mortgage and Exchange Bank of Copenhagen). , two of Scandinavia's biggest financial groups. ECsoft is helping these organisations improve the efficiencies of their internal systems and to reach new customers by integrating legacy systems with new Web-based applications See Web application. . In the TMT sector, ECsoft's expertise in new Java-based technologies has positioned the Company well to win several important contracts this year. For example, ECsoft has extended its work with Hitachi Hitachi (hētä`chē), city (1990 pop. 202,141), Ibaraki prefecture, E central Honshu, Japan, on the Kashima Sea. The city is a leading producer of Japan's electrical equipment. , one of the world's largest electronic companies, to re-engineer and automate To turn a set of manual steps into an operation that goes by itself. See automation. their business systems to improve efficiencies. In the telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. sector, ECsoft has long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. , well-established relationships with many of the leading players and, despite the uncertainty surrounding sur·round tr.v. sur·round·ed, sur·round·ing, sur·rounds 1. To extend on all sides of simultaneously; encircle. 2. To enclose or confine on all sides so as to bar escape or outside communication. n. the health of this sector, ECsoft has secured new framework agreements with Telia, Nokia Nokia (nō`kēä), town (1996 pop. 26,326), Western Finland prov., SW Finland, on Lake Näsijärvi. It is an industrial community where wood and rubber products are manufactured. and Ericsson in the last six months. ECsoft continues to work with leading TMT businesses across Europe to reap the advantages of new technologies, such as 3G (UMTS (Universal Mobile Telecommunications System) The GSM implementation of the 3G wireless phone system. Part of IMT-2000, UMTS provides service in the 2 GHz band and offers global roaming and personalized features. ), Bluetooth, Digital Rights Management and the latest generation tele- tele- word element [Gr.], operating at a distance; far away. tele- or tel- pref. Distance; distant: teletherapy. tele- word element. [Gr. and radio communication systems. ECsoft's continued focus on the public sector, and its approach to 'modernising Government' have led to new business this year with organisations such as Southampton City Council and the London Borough of Hillingdon The London Borough of Hillingdon is the westernmost borough in Greater London, England. It is home to Brunel University and London Heathrow Airport. Districts It includes the areas:
penetration - the act of entering into or through something; "the penetration of upper management by women" within this sector and build on our earlier significant win at the London Borough of Bromley The London Borough of Bromley is a London Borough of outer southeast London, England. It has an area of 59 square miles (153 km²), of which the majority is green belt land. The borough is the largest in Greater London in terms of area. . Focus on strategic partnerships As with our focus on 3 core markets, ECsoft has also focused on building a limited number of strategic partnerships with leading technology and skills providers to offer our customers the very best IT and business solutions. In the first six months of 2001, this has been evidenced through significant partnership announcements with Pink Elephant, GFI GFI Ground Fault Interrupter GFI Go For It GFI Government-Furnished Information GFI Growing Families International GFI Goodness of Fit Indices GFI Government Financial Institutions (Philippines) GFI Gross Farm Income Informatique and iPlanet. In March 2001, the Company divested the Managed Support Business in the UK to Pink Elephant and signed a co-operation agreement with them. Since then, we have successfully novated the majority of Managed Support customer contracts to Pink Elephant and have worked with them on several new business engagements. In June, ECsoft signed a strategic co-operation agreement with GFI Informatique, the European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. IT services company, to co-ordinate sales activities and share marketing information. The two companies have complementary operations, specialising in systems integration and consultancy offerings to large international customers. As ECsoft's geographic focus is northern European and GFI Informatique's is predominantly pre·dom·i·nant adj. 1. Having greatest ascendancy, importance, influence, authority, or force. See Synonyms at dominant. 2. southern European, this co-operation agreement strengthens the reach of both companies, providing a greater range of services to a broader customer base. Also in the first half of this year, ECsoft formed a strategic international relationship with iPlanet (the global software provider created jointly by Sun Microsystems Sun Microsystems, Inc. (NASDAQ: JAVA[3]) is an American vendor of computers, computer components, computer software, and information-technology services, founded on 24 February 1982. and AOL (A division of Time Warner, Inc., New York, NY, www.aol.com) The world's largest online information service with access to the Internet, e-mail, chat rooms and a variety of databases and services. ) to exploit their market-leading Java-based, component platform. This international initiative draws upon ECsoft's considerable consultancy and integration expertise founded on the back of successful implementations at customers such as Cheshire DataSystems Limited, Hitachi, London Borough of Bromley and the Scottish Police Force. ECsoft's track record led to our UK operation being awarded iPlanet's "E-integrator of the Year 2001." Outlook Looking at the broader market conditions in the second half of 2001, Jerry Ellis, Chief Executive of ECsoft Group plc comments: "As we noted at our Annual General Meeting in May, there have been clear signs of softness within the IT consultancy market generally, which we expect to continue in the second half of this year. Nonetheless, ECsoft is in a strong position. We have a healthy balance sheet to allow us to respond to opportunities (as evidenced by our recent acquisition in Sweden) and an experienced management team that will continue to respond swiftly to changes in market condition. With our continued focus on selected customers, markets, partners and propositions, we are well positioned to take advantage of an upswing Upswing An upward turn in a security's price after a period of falling prices. in the market, when it occurs." About ECsoft Group plc: ECsoft Group plc (London:ECS; Nasdaq OTC:ECSGY) is an independent IT consultancy, systems integrator An individual or organization that builds systems from a variety of diverse components. With increasing complexity of technology, more customers want complete solutions to information problems, requiring hardware, software and networking expertise in a multivendor environment. and IT solutions provider, specialising in the development and delivery of innovative mission-critical business solutions. ECsoft's mission is to transform business vision into technical reality and it achieves this by investing in and exploiting innovative and emerging technologies, concepts and processes from around the world. ECsoft's customers include many of Europe's top 500 companies as well as government and public organisations. With offices in the UK, the Netherlands, Germany, and Scandinavia, ECsoft is a leader in the practical application of advanced technology. More information about ECsoft can be found at www.ecsoft.com Introduction to Accounts The ECsoft Group plc First Half results for 2001 are published in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with the Listing Rules of the London Stock Exchange London Stock Exchange London marketplace for securities. It was formed in 1773 by a group of stockbrokers who had been doing business informally in local coffeehouses. . The preliminary financial information it contains has been prepared according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting in the United Kingdom ("UK GAAP UK GAAP United Kingdom Generally Accepted Accounting Principles "). Historically, ECsoft has reported its results on a quarterly basis. In the first quarter 2001, ECsoft ceased to be listed on the Nasdaq National Market. ECsoft will henceforth satisfy the listing obligations of the United Kingdom Listing Authority by producing half-yearly interims and full year reports. Forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. : Statements contained in this release that are not historical facts may contain forward-looking information with respect to the plans, projections or future projections, future performance, financial condition and/or results of the Company, which by their nature the occurrence of which involve certain risks and uncertainties. Potential risks and uncertainties include, without limitation, changes to UK domestic and global economic and business conditions; significant fluctuation Fluctuation A price or interest rate change. in quarterly operating results; continued competitive pressures in the market place; reliance on attracting and retaining technically skilled professional staff; successful integration of acquired companies; managing risks associated with customer projects; the Company's ability to manage its growth; dependence on trends towards open systems computing computing - computer architecture and outsourcing (1) Contracting with outside consultants, software houses or service bureaus to perform systems analysis, programming and datacenter operations. Contrast with insourcing. See netsourcing, ASP, SSP and facilities management. ; reliance on key executives; reliance on relationships with third parties; and the Company's ability to develop information technology solutions that keep pace with rapid and continuing changes in computing technology, evolving industry standards and changing customer preferences. More information on potential factors that could affect the Company's financial results are included in the Company's filings with the Securities and Exchange Commission, particularly in its Annual Report on Form 20-F. As a result, the Company's plans, projections, future performance, financial condition and/or results may differ materially from those set out in the Company's forward-looking statements. Whilst the Company may elect to update forward-looking statements in the future, it disclaims any obligation to do so.
Summarised profit and loss account
for the six months ended 30 June 2001
Unaudited Unaudited Audited
6 months to 6 months to Year to
30 June 30 June 31 December
2001 2000 2000
Notes (pound)000 (pound)000 (pound)000
Turnover 2 34,119 34,705 73,204
Operating costs (34,876) (37,144) (75,828)
--------------------------------------------------
Operating profit/(loss)
before goodwill
amortisation and
exceptional items 1,340 (535) 749
Goodwill amortisation (1,035) (1,110) (2,130)
Exceptional items (1,062) (794) (1,243)
--------------------------------------------------
Operating loss after
goodwill amortisation
and exceptional items (757) (2,439) (2,624)
Profit on sale of
fixed asset investment - 1,815 1,965
Profit on sale
of operations 2,542 - -
-------------- ------------- ----------------
Profit/(loss) on
ordinary activities
before interest and
taxation 1,785 (624) (659)
Bank interest receivable 984 1,119 2,063
Interest payable and
similar charges (6) (48) (34)
-------------- ------------- ----------------
978 1,071 2,029
Profit on ordinary
activities
before taxation 2,763 447 1,370
Tax on profit
on ordinary
activities 3 (1,773) (1,006) (1,997)
-------------- ------------- ----------------
Profit/(loss) on
ordinary activities
after taxation 990 (559) (627)
Equity minority interests - 68 68
-------------- ------------- ----------------
Retained profit for
the financial year 990 (491) (559)
============== ============= ================
Earnings per share
- basic 8.5 (4.2) (4.8)
- fully diluted 8.4 (4.2) (4.8)
Statement of total recognised gains and losses
Unaudited Unaudited Audited
6 months to 6 months to Year to
30 June 30 June 31 December
2001 2000 2000
(pound)000 (pound)000 (pound)000
Profit/(loss) attributable
to members of the
parent company 990 (491) (559)
Exchange difference on
retranslation of net assets
of subsidiary undertakings 242 (483) (342)
-------------- -------------- ------------
Total recognised gains and
losses relating
to the period 1,232 (974) (901)
============== ============== ============
Summarised Balance sheet
at 30 June 2001 Unaudited Unaudited Audited
6 months to 6 months to Year to
30 June 30 June 31 December
2001 2000 2000
Notes (pound)000 (pound)000 (pound)000
Fixed assets
Intangible assets 32,717 38,327 36,760
Tangible assets 2,258 3,642 3,185
-------------- -------------- --------------
34,975 41,969 39,945
============== ============== ==============
Current assets
Debtors 14,847 19,275 19,031
Cash at bank
and in hand 4 42,886 36,273 36,207
-------------- -------------- --------------
57,733 55,548 55,238
Creditors: amounts
falling due within
one year (14,611) (19,373) (16,886)
-------------- -------------- --------------
Net current assets 43,122 36,175 38,352
-------------- -------------- --------------
Total assets less
current liabilities 78,097 78,144 78,297
Creditors: amounts
falling due after
more than one year (101) (174) (99)
Provision for
liabilities and charges (249) (212) (709)
-------------- -------------- --------------
77,747 77,758 77,489
Minority interests 9 11 10
-------------- -------------- --------------
77,756 77,769 77,499
============== ============== ==============
Capital and reserves
Called up share capital 5,750 5,827 5,804
Share premium account 3,313 2,739 3,114
Capital redemption reserve 219 91 143
Special reserve 43,437 43,437 43,437
Other reserves 15,176 15,176 15,176
Profit and
loss account 5 9,861 10,499 9,825
-------------- -------------- --------------
Shareholders' funds:
equity 77,756 77,769 77,499
============== ============== ==============
Summarised group statement of cashflows
Unaudited Unaudited Audited
6 months to 6 months to Year to
30 June 30 June 31 December
2001 2000 2000
Notes (pound)000 (pound)000 (pound)000
Operating profit/(loss) (757) (2,439) (2,624)
Depreciation 668 846 1,713
Amortisation of goodwill 1,035 1,110 2,130
Profit on disposal
of fixed assets 10 5 10
Movements in
working capital 1,430 (4,055) (2,610)
-------------- ------------- --------------
Net cash inflow/(outflow)
from operating
activities 2,386 (4,533) (1,381)
Returns on investment
and servicing of finance 927 1,019 2,088
Taxation (635) (1,138) (1,978)
Capital expenditure and
financial investment (500) 1,140 840
Acquisitions and
disposals 6,097 (3,782) (5,640)
Management of liquid
resources (6,718) 2,647 4,299
-------------- ------------- --------------
Net cash inflow/(outflow)
before financing 1,557 (4,647) (1,772)
Financing (1,222) (703) (1,560)
Increase/(decrease)
in cash 4 335 (5,350) (3,332)
============== ============= ==============
Notes to the unaudited interim report
1. Basis of preparation
The interim financial information has been prepared on the basis of
the accounting policies set out in the statutory accounts for ECsoft
Group plc for the year ended December 2000. The taxation charge is
calculated by applying the directors' best estimates for the year of
the annual tax rate to the profit for the period. Other expenses are
accrued in accordance with the same principles used in preparation of
the annual accounts. The financial information contained in this
statement does not constitute statutory accounts as defined in section
240 of the Companies Act 1985. The financial information for the full
proceeding year is based on the statutory accounts for the financial
year ended 31 December 2000. Those accounts, upon which the auditors
issued an unqualified opinion, have been delivered to the Registrar of
Companies.
2. Turnover and segmental analysis
ECsoft Group plc operates in three principal geographic areas: the
United Kingdom, Scandinavia and the rest of Europe. The company
operates in a single business segment, that of computer consultancy
and associated services.
Turnover, operating profit and profit on ordinary activities before
taxation are analysed as follows:
Geographical Area Unaudited Unaudited Audited
6 months to 6 months to Year to
30 June 30 June 31 December
2001 2000 2000
(pound)000 (pound)000 (pound)000
Turnover by origin
- UK 10,733 12,582 27,375
- Scandinavia 17,227 14,519 30,794
- Rest of Europe 6,159 7,604 15,035
--------------- ------------- ---------------
34,119 34,705 73,204
=============== ============= ===============
Operating profit/(loss)
before goodwill
amortisation and
exceptional items
- UK 328 575 1,739
- Scandinavia 961 (1,461) (1,293)
- Rest of Europe 51 351 303
--------------- ------------- ---------------
1,340 (535) 749
=============== ============= ===============
Operating profit/(loss)
after goodwill
amortisation and
exceptional items
- UK (535) (196) 803
- Scandinavia 296 (2,038) (2,544)
- Rest of Europe (518) (205) (883)
--------------- ------------- ---------------
(757) (2,439) (2,624)
=============== ============= ===============
Profit/(loss) before Tax
- UK 2,880 2,630 4,621
- Scandinavia 402 (1,960) (2,360)
- Rest of Europe (519) (223) (891)
--------------- ------------- ---------------
2,763 447 1,370
=============== ============= ===============
3. Taxation Unaudited Unaudited Audited
6 months to 6 months to Year to
30 June 30 June 31 December
2001 2000 2000
(pound)000 (pound)000 (pound)000
UK Corporation tax 1,505 700 1,663
Overseas taxation 268 306 427
--------------- ------------- ---------------
1,773 1,006 2,090
=============== ============= ===============
4. Analysis of net funds
31 December Cashflow Exchange 30 June
2000 Differences 2001
(pound)000 (pound)000 (pound)000 (pound)000
Cash at bank and in hand 7,188 (6) (33) 7,149
Overdraft (344) 341 - (3)
Short term deposits* 29,019 6,718 - 35,737
Finance leases (202) 36 - (166)
--------- ---------- --------- ---------
At 30 June 2000 35,661 7,089 (33) 42,717
========= ========== ========= =========
* Short term deposits are included within cash at bank and in hand
in the balance sheet
5. Share buyback
The company continued its share buyback programme in the first half of
2001. A total of 151,000 shares have been purchased in the period and
as a result, (pound)1,196,230 has been recorded in the profit and loss
account.
6. Post balance sheet event
On 4 July 2001, the Company announced that it had acquired the "S17"
division of Framfab AB, the Swedish IT services group, for a cash
consideration of approximately (pound)100,000. The acquisition brings
63 employees and access to an additional customer base to ECsoft's
Swedish subsidiary.
INDEPENDENT REVIEW REPORT TO ECSOFT GROUP PLC
We have been instructed by the company to review the financial
information set out on pages 6 to 11 and we have read the other
information contained in the interim report and considered whether it
contains any apparent misstatements or material inconsistencies with
the financial information.
Directors' responsibilities
The interim report, including the financial information contained
therein, is the responsibility of, and has been approved by the
directors. The Listing Rules of the Financial Services Authority
require that the accounting policies and presentation applied to the
interim figures should be consistent with those applied in preparing
the preceding annual accounts except where any changes, and the
reasons for them, are disclosed.
Review work performed
We conducted our review in accordance with guidance contained in
Bulletin 1999/4 issued by the Auditing Practices Board. A review
consists principally of making enquiries of group management and
applying analytical procedures to the financial information and
underlying financial data and based thereon, assessing whether the
accounting policies and presentation have been consistently applied
unless otherwise disclosed. A review excludes audit procedures such as
tests of controls and verification of assets, liabilities and
transactions. It is substantially less in scope than an audit
performed in accordance with Auditing Standards and therefore provides
a lower level of assurance than an audit. Accordingly we do not
express an audit opinion on the financial information.
Review conclusion
On the basis of our review we are not aware of any material
modifications that should be made to the financial information as
presented for the six months ended 30 June 2001.
Ernst & Young LLP
London
26 July 2001.
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