Delcam Plc Interim Report 2006

Interim Results for the six months to 30 June 2006


  • Record half-year sales of £13.5 million against £11.8 million in 2005 first half
  • First half pre-tax profit of £1.2 million, up 11% on first half of 2005
  • Interim dividend increased to 1.2p
  • Continued high level of investment in R&D and in sales and marketing
  • Position as leading specialist supplier of Numerical Control (“NC”) software and services confirmed by CIMdata
  • Strong growth in sales of PowerINSPECT inspection software
  • Acquisition of PartMaker business in July
 

Chairman’s Statement


Financial Highlights

I am very pleased to report that, during the first half of 2006, Delcam has again continued the growth in sales that has been seen in recent years. Sales for the six months to 30 June 2006 were at the record level for a half-year at £13.5 million compared with £11.8 million during the first half of 2005, an increase of 14%. This growth has been achieved partly through the addition of the FeatureCAM family of software and partly through increased sales of our Power Solution range of programs.

Profit before tax of £1.2 million for the first half was 11% above that achieved for the first half of last year. This result has been achieved even though the company has continued to increase its investment in product development and in sales and marketing. During the period £3.7 million was spent on R & D (2005: £3.1 million). Basic earnings per share were 16.6p compared with 15.6p in the equivalent period last year, an increase of 6%.

Dividend

With improved profitability to that in the first half of 2005, the Board proposes to pay an interim dividend of 1.2p per ordinary share. This will be paid on 18 September 2006 to shareholders on the Register as at 1 September 2006.

Review

As mentioned above, the growth in sales has been the result of both the addition of the FeatureCAM software range and increased demand for Delcam’s established products. The FeatureCAM range is now available in most of the 60 countries in which we are represented, with further growth expected as the products become better established in the international market place.

The most successful of our established products, in growth terms, has been the inspection program, PowerINSPECT. This has seen an increase in sales of more than 80% compared to the first six months of 2005. Increases have also been seen for our four other key products, the design software PowerSHAPE, the PowerMILL and FeatureCAM CAM systems and the artistic CADCAM program, ArtCAM.

In July 2006, we acquired the PartMaker range of software, the industry-leading programs for the programming of multi-axis turning equipment. The addition of the PartMaker range enhances our comprehensive family of machining software. This latest expansion will follow a similar pattern to the addition of FeatureCAM last year, in that the software will continue to be developed as an independent product line in the USA but will be marketed worldwide through the Delcam network. It is expected to contribute to future sales and profit growth as well as further strengthening Delcam’s position in the important North American market.

Our increased sales, together with the addition of FeatureCAM and PartMaker, have consolidated our position as the world’s number one specialist supplier of NC software and services in the rankings published by the US analyst CIMdata. Further recognition came in May, when PowerMILL was presented with the “Best Software” award at the Metalworking Production Awards during the MACH exhibition.

Outlook

The normal business pattern for Delcam is to achieve higher sales and profits in the second half of the year. With the addition of the PartMaker business, the Directors expect this pattern to continue. However, with the majority of Delcam’s international business being undertaken in US$, any further decline of the US$ could marginally affect our level of profitability.

T R M KINSEY
Chairman

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