Source - RNS
RNS Number : 2398L
Medilink-Global UK Limited
29 September 2016
 

29 September 2016

 

MediLink-Global UK Limited

("MediLink" or "the Company")

 

HALF-YEARLY REPORT for the six months to 30 june 2016

 

MediLink, the provider of electronic healthcard network services to insurance companies and corporate organisations, to help them facilitate the administration of medical claims and healthcare data management, announces its interim results for the six months ended 30 June 2016.

 

Financial highlights

 

·      Revenue increased by 33.7% to £941,000 (H1 2015: £704,000);

 

·      Revenue contribution from Malaysia operations increased by 57.3% to £648,000 (H1 2015: £412,000);

 

·      Operating profit of £382,000 (H1 2015: operating loss of £112,000); and

 

·      The improvement in operating performance was attributable to revenue growth in Malaysia arising from the software licensing contract with Etiqa Insurance Berhad and increased membership levels, combined with continued cost saving measures within MediLink's operations.

 

Operational highlights

 

Medilink Malaysia

 

·      The Directors continue to believe there is growing demand in Malaysia for Third Party Administration ("TPA") services in the Small and Medium Enterprises Sector as well as Government-link agencies, Government-link bodies and Government-link Corporations. MedilinkGlobal (M) Sdn Bhd ("MGMY") is now focusing its business development effort in these growing market segments.

 

·      During the period under review, the marginal increase in membership of 5,000 from the existing self-funded corporate clients of Medilink Malaysia, contributed to the revenue growth of the Group.

 

·      AIA Bhd (AIA) contributed an additional 139,000 members to the membership growth of Medilink Malaysia during the period under review.

 

In collaboration with Qualitas Medical Group Sdn Bhd, a Malaysian based primary healthcare provider group with operations in Malaysia and several countries in the Asia Pacific region, Medilink Malaysia licensed the use of its Claims Management system and front-end electronic healthcard network infrastructure, to facilitate on-line-real-time member's eligibility validation and submission of primary care claims. Through this collaboration, an additional 15,000 members from a total of 10 employers newly acquired as of September 2016, were added to the Medilink service platform.

 

The Board of Directors of Medilink are confident that there will be a continuous positive effect for Medilink Malaysia in the years to come. Notwithstanding this, and further to the announcement released by the Company on 27 July 2016, the Board considers that it is no longer in the interests of the Company to continue to be admitted to trading on AIM. As such, the Company will be seeking shareholder approval for cancellation of the Company's shares from trading AIM in the near future.

 

Enquiries: 

 

MediLink-Global UK Limited

Allenby Capital Limited

(Nominated Adviser and Broker)

Shia Kok Fat, Chief Executive Officer

Nick Athanas

Tel: 00 603 2296 3028

James Reeve

 

Liz Kirchner

www.medilink-global.com

Tel: +44(0)20 3328 5656

 

 

CHAIRMAN'S STATEMENT

 

The Board of MediLink is pleased to present the Group's unaudited results for the six month period ended 30 June 2016, which show an encouraging trend in improved operating performance compared with the comparative period for the six months ended 30 June 2015.

 

FINANCIAL REVIEW

 

The Group recorded revenues of £941,000 (H1 2015: £704,000) and an operating profit before tax of £363,000 (H1 2015: operating loss of £112,000) for the six months ended 30 June 2016 from its continuing operations

 

Growth in revenues increased by 33.7% over the same period last year, with revenue from Malaysia growing by 57.3% and TPA income increasing by 21.5%. The Malaysian operating entities continued to make the largest contribution of 67% (H1 2015: 59%) of the Group's revenues for the period under review, whilst Singapore contributed 33% (H1 2015: 42%).

 

Revenue contribution from Malaysia operations increased by 57.3% to £648,000 (H1 2015: £412,000). The Company's operations in Singapore recorded a marginal increase in revenues, by 8.6% to £317,000, compared with the same period last year (FY 2015: £292,000). After taking into account inter-group transactions in the period, as detailed in note 5 to the interim results, the Group's revenue generated in the period totalled £941,000.

 

 

The Group achieved operating profit for the period compared to the same period last year as a result of revenue growth in Malaysia and the cost saving measures taken across all the subsidiaries of MediLink resulting in a 11% reduction in administrative costs.

 

PERIOD IN FOCUS

 

The first half of 2016 witnessed another increase in revenue in Malaysia from £412,000 in the first half of last year to £648,000 for the six months to 30 June 2016, representing a 57.3% growth over the same period last year. The number of enrolled members in Malaysia as at the end of June 2016 was approximately 1,050,000 (30 June 2015: 990,000) and this had grown to 1,100,000 by the end of August 2016, while the number of corporate clients contracted stood at 227 at 30 June 2016, compared to 226 at the same stage last year. The number of healthcare providers operating in our network in Malaysia now stands at 1,500 (1,500 at this stage last year).

 

In the period under review, the software licensing income contributed £198,000 (2015: £3,000), representing 27% of the 33.7% increase in the Company's turnover and 47% of the 57% increase in Malaysia revenue.

 

The reduction of administration costs, combined with the strong contribution from software licensing income and the growth in membership levels, has helped to generate a healthy operating profit in Malaysia, representing a significant improvement on the loss incurred in the corresponding period last year. Management are not anticipating a significant increase in operating costs in the second half of 2016.

 

Further to the completion and deployment of the Claims Management System licensing to Great Eastern Life Assurance Co., Ltd on 11 September 2015, the Malaysia entity had secured an 18-month contract with Etiqa Insurance Berhad for a licensing of its bespoke Electronic Claims Clearing System (E.C.C.S).

 

 

PROSPECTS

 

With the impact of continued growth in TPA membership revenue, as well as system licensing in our Malaysia operation, the Directors are confident that the Group's financial performance should continue to improve in the second half of 2016 and during the financial years thereafter.

 

Notwithstanding the improved financial performance, it is the opinion of the board that it is no longer in the long term interests of the Company and its shareholders to continue to be admitted to trading on AIM, as the Board considers that the costs associated with the listing are not commensurate with the benefits that the company is receiving.  The Company is in the process of preparing a circular, setting out further details on the rationale for seeking cancellation and a further update will be provided in due course.

 

Norman Lott

Chairman

 

 


Consolidated Statement of Comprehensive Income

Six month period ended 30 June 2016

 

 

Period

Period

Year

 

 

Ended

30.06.16

Ended

30.06.15

Ended

31.12.15

 

 

Unaudited

Unaudited

Audited

 

Note

£'000

 

£'000

£'000

Continuing Operations

 

 

 

 

Revenue

5

941

704

1,540

Cost of sales

 

(620)

(508)

(1,166)

 

 

 

 

 

Gross profit

 

321

196

374

Other income / (expense)

 

334

-

4

Goodwill impairment

 

-

-

-

Impairment Loss

 

 

-

(322)

Gain on disposal of subsidiary

 

 

 

783

Administrative expenses

 

(273)

(308)

(460)

Operating Profit / (Loss)

 

382

 (112)

379

Finance expenses

 

(19)

(19)

(44)

 

 

 

 

 

Profit/(Loss) before taxation from continuing Operations

 

363

(131)

335

Taxation

4

-

-

(13)

Profit/(Loss) for the year from continuing operations

 

 

363

 

(131)

322

Discontinued Operations

 

 

 

 

Loss after tax for the year

 

-

(58)

(57)

Profit/(Loss) for the year

 

363

(189)

 

265

  Other Comprehensive (loss)/profit

 

 

 

  Exchange differences on translating 

  foreign operations

 (334)

296

9

  Total comprehensive profit for the period

  net of tax

29

107

274

 

 

 

 

Profit/(Loss) for the year attributable to:

 

 

 

Owner of the Company

 362

(190)

261

Non-controlling

1

1

4

 

363

(189)

265

Total comprehensive profit attributable to: attributable to:

 

 

 

Owner of the Company

30

109

270

Non-controlling

(1)

(2)

4

 

29

107

274

 

Earning per share (pence)

 

 

 

Basic and Diluted

2

0.27

(0.15)

0.21

 

 

 

 

 

Earnings per share for continuing operations (pence)

 

 

 

 

Basic and Diluted

2

0.27

(0.11)

0.26

 

 

 

 

 

* In accordance with IAS33 "Earnings per share" and where the Group has reported a loss for the period, the potential shares are not dilutive. The Group has not issued any instrument with dilutive effect.  

 

 


Consolidated Statement of Financial Position

As at 30 June 2016

 

 

30.06.16

30.06.15

31.12.15

 

Note

Unaudited

Unaudited

Audited

 

 

£'000

£'000

£'000

ASSETS

Non-current assets

 

 

 

 

Intangible assets

 

1,530

1,485

1,532

Property, plant and equipment

 

6

71

35

 

 

 

 

 

Total non-current assets

 

1,536

1,556

1,567

 

 

 

 

 

Current assets

 

 

 

 

Trade and other receivables

 

1,241

1,191

1,157

Cash and cash equivalents

 

473

383

573

 

 

1,714

1,574

1,730

Assets held for sales

 

 

1,012

-

Total current assets

 

1,714

2,586

1,730

 

 

 

 

 

TOTAL ASSETS

 

3,250

4,142

3,297

 

 

 

 

 

EQUITY

Capital and Reserves

 

 

 

 

Share capital

6

6,074

6,074

6,074

Share premium account

6

1,507

1,507

1,507

Reserves

 

(7,224)

(7,675)

(7,522)

Total shareholders' equity

 

357

(94)

329

Non-controlling interests

 

(1)

(4)

(1)

Total equity interest

 

356

(99)

328

 

Current liabilities

 

2,691

2,719

2,794

Liabilities directly associated with the assets held for sales

 

-

1,349

-

 

 

 

 

 

Total current liabilities

 

2,691

4,068

2,794

 

 

 

Non-current liabilities

 

 

 

 

Other payables

 

145

129

118

Deferred tax liabilities

 

58

44

57

 

 

 

 

 

Total non-current liabilities

 

203

173

175

 

 

 

 

 

TOTAL EQUITY AND LIABILITIES

 

3,250

4,142

3,297

 

 

 

 

 

           

 

 

 

Consolidated Statement of Cash Flows

Six months ended 30 June 2016

 

30.06.16 

30.06.15

31.12.15 

 

Unaudited

Unaudited

Audited

 

£'000

£'000

£'000

Cash flows from operating activities

 

 

 

Profit/(loss) before taxation

363

(131)

335

Loss before taxation for discontinued operation

-

(58)

(57)

Adjustments for:

 

 

 

Amortisation of intangible assets

34

10

11

Depreciation of property, plant and equipment

40

33

49

Gain on disposal of subsidiary

(336)

-

(783)

Goodwill impairment

 

 

-

Finance costs

10

12

27

Cash from operating activities before changes in working capital

111

(124)

(401)

(Increase)/decrease  in inventory

(29)

112

-

(Increase)/decrease in trade and other receivables

(21)

(256)

231

Increase in trade and other payables

41

412

730

Cash flows from operations

102

144

560

 

 

 

Interest paid

-

-

-

Net cash used in operations

102

144

560

 

 

 

 

Investing activities

 

 

 

Purchase of intangible assets

-

-

(38)

Net cashflow arising from loss of control of subsidiary

 

 

(180)

Purchase of property, plant and equipment

-

(39)

(24)

 

 

 

 

Net cash used in investing activities

-

(39)

(242)

 

 

 

 

Financing activities

 

 

 

Interest paid

(10)

(12)

(28)

Term Loan

-

-

-

Advance from shareholders

-

5

60

Repayment of hire purchase liabilities

(2)

(2)

-

Net cash (used in)/generated by financing activities

(12)

(9)

32

 

 

 

Net increase in cash and cash equivalents 

90

96

350

 

 

 

Effect of exchange rate changes

-

-

(31)

Cash and cash equivalents at the beginning of the period 

 

383

 

 287

 

254

 

 

 

 

Cash and cash equivalents at the end of the period

473

383

573

 

 

 

 

 

Consolidated Statement of Changes in Equity

Six months ended 30 June 2016

 

 

Share capital

Share Premium

Exchange Reserves

Retained Earnings

Total

Non Controlling Interest

Total

 

£'000

£'000

£'000

£'000

£'000

£'000

£'000

Balance at 01 January 2014

6,045

1,507

5

(5,478)

2,079

(2)

2,077

 

 

 

 

 

 

 

 

Loss for the year other comprehensive income

-

-

-

(1,990)

(1,990)

(2)

(1,992)

Exchange differences

-

-

(59)

-

(59)

(1)

(60)

Total comprehensive loss for the year

-

-

(59)

(1,990)

(2,049)

(3)

(2,052)

 

 

 

 

 

 

 

 

Issue of shares

29

-

-

-

29

-

29

Balance at 31 December 2014

6,074

1,507

(54)

(7,468)

59

(5)

54

 

 

 

 

 

 

 

 

Loss for the year other comprehensive income

-

-

-

261

261

4

265

Exchange differences

-

-

9

-

9

-

9

Total comprehensive loss for the year

-

-

9

261

270

4

274

 

 

 

 

 

 

 

 

Transfer of foreign exchange attributable to the loss of control of subsidiary

-

-

122

(122)

-

-

-

Balance at 31 December 2015

6,074

1,507

77

(7,329)

329

1

328

 

 

 

 

 

 

 

 

Profit for the year

-

-

-

362

362

1

363

Exchange differences

-

-

(335)

-

(335)

-

(335)

Total comprehensive loss for the year

-

-

(335)

362

27

1

28

 

 

 

 

 

 

 

 

Issue of shares

 

 

 

 

 

 

 

Balance at 30 June 2016

6,074

1,507

(258)

(6,967)

356

-

356

 

 

 

 

 

 

 

 

 

 

 

Notes to the Interim Financial Information

Six month period ended 30 June 2016

 

1.   Basis of preparation

 

The financial information has been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union. The principal accounting policies used in preparing the interim results are consistent with those the group expects to apply in its financial statements for the year ending 31 December 2016 and are consistent with those disclosed in the group's Report and Financial Statements for the year ended 31 December 2015.

 

The interim results have not been reviewed nor audited by the Company's auditors. The comparatives for the year ended 31 December 2015 are not the Company's full statutory financial statements for that period. A copy of the statutory financial statements for that period, which were prepared under IFRS, have been delivered to the Registrar of Companies. The auditors' report on those accounts was unqualified, but included an emphasis of matter in respect of going concern:

 

"In forming our opinion on the financial statements, which is not modified, we have considered the adequacy of the disclosure made in note 2 (v) to the financial statements concerning the company's ability to continue as a going concern. The financial statements have been prepared on the going concern basis, which depends on the continued shareholder support and the generation of increased revenues. These conditions, along with the other matters explained in note 2 (v) to the financial statements, indicate the existence of a material uncertainty which may cast significant doubt about the company's ability to continue as a going concern. The financial statements do not include the adjustments that would result if the company was unable to continue as a going concern."

 

Whilst the financial information included in this Interim Financial information has been prepared in accordance with the recognition and measurement criteria of IFRS, it does not include sufficient information to comply with IFRS.

 

The interim results announcement was approved by the board on 29 September 2016.

 

2.   Basic and diluted loss per ordinary share

 

Basic loss per share is calculated by dividing the loss attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the period. In accordance with IAS 33 and where the Group has reported a loss for the period, the shares are not dilutive.

     

 

Period ended 30.06.16

Period ended

30.06.15

Year ended 31.12.15

 

£'000

(unaudited)

£'000

(unaudited)

£'000

(audited)

Profit (loss) before taxation

 

 

 

-   Continued operations

363

(131)

322

-   Discontinued operations

-

(58)

(57)

 

363

(189)

265

 

 

 

 

Basic weighted average shares in issue

121,492,004

121,492,004

121,492,004

 

 

 

 

Basic and diluted earnings(loss) per share based on issued share capital (pence)

0.27

(0.17)

0.21

 

 

3.   Dividend

The Directors do not propose a dividend in the period.

 

4.   Taxation

No charge to taxation arises in the six months ended 30 June 2016.

 

5.   Turnover and segmental analysis

 

Per IFRS 8 operating segments are based on internal reports about components of the group, which are regularly reviewed and used by the Board of Directors being the Chief Operating Decision Maker ("CODM") for strategic decision making and resource allocation, in order to allocate resources to the segment and to assess its performance. The Group's reportable operating segments are as follows:

 

(I)         Third party administrator

(II)         Software licensing

 

The CODM monitors the operating results of each segment for the purpose of performance assessments and making decisions on resource allocation. The management has organised the entity based on differences in products and services. Third party administrator segment is derived from aggregating China, Malaysia and Singapore entity while Software licensing segment represent a single entity from Malaysia. Performance is based on external and internal revenue generations and profit before tax, which the CODM believes are the most relevant in evaluating the results relative to other entities in the industry. Segment assets and liabilities are presented inclusive of inter segment balances, as inter-segment pricing. Information regarding each of the operations of each reportable segment is included below.

 

 

30 June 2016 (unaudited)

Third party administrator

Software licensing

 

Consolidation

 

Total

 

£'000

£'000

£'000

£'000

External revenue

750

191

                 (27)

914

Internal revenue

20

7

-

27

Total revenue

770

198

(27)

941

 

 

 

 

 

Interest expenses

(21)

-

-

(20)

Depreciation and amortisation

(38)

-

-

(109)

Corporation tax

-

-

-

-

Earning before tax (EBT)

36

(10)

-

26

 

 

 

 

 

Assets

4,325

169

(1,244)

3,250

Liabilities

(5,794)

(336)

3,237

(2,893)

 

(i)   The assets of third party administrator include the goodwill on consolidation of £1,338,000.

                                                                                         

Revenues from the Group's major customers AIA Berhad amounted to £356,151: (H1 2015: £276,621) arising from sales in the third party administrator segment.

 

 

 

30 June 2015 (unaudited)

Third party administration

Software licensing

 

Consolidation

 

Total

 

£'000

£'000

£'000

£'000

External revenue

701

3

                   -

704

Internal revenue

-

-

-

-

Total revenue

701

3

-

704

 

 

 

 

 

Interest expenses

(20)

-

-

(20)

Depreciation and amortisation

(109)

-

-

(109)

Corporation tax

-

-

-

-

Earning before tax (EBT)

(58)

(6)

(67)

(131)

 

 

 

 

 

Assets

6,602

182

(2,642)

4,142

Liabilities

(7,129)

(329)

3,217

(4,241)

 

The assets of third party administrator include the goodwill on consolidation of £1,338,000.

 

 

31 December 2015 (audited)

Third party administration

Software licensing

 

Consolidation

 

Total

 

£'000

£'000

£'000

£'000

External revenue

1,290

250

-

1,540

Internal revenue

133

79

(212)

-

Total revenue

1,423

329

(212)

1,540

 

 

 

 

 

Interest revenue

-

-

-

-

Interest expenses

44

-

-

44

Depreciation and amortisation

59

1

-

60

Impairment loss

-

-

(322)

(322)

Earning before tax (EBT)

94

(13)

254

335

 

 

 

 

 

Assets

4,404

152

(1,259)

3,297

Liabilities

(5,616)

(284)

2,931

(2,969)

 

The assets of third party administrator are including the goodwill on consolidation of £1,338,000 (2014: £1,338,000).

 

Revenues from a customer amounted to £280,142 (2014: £263,249) arising from sales by third party administrator segment.

 

 

The geographical split of revenue and non-current assets arises as follows:

 

30 June 2016 (unaudited)

 

Jersey

 

Singapore

 

Malaysia

 

Total

 

£'000

£'000

£'000

£'000

Revenue

-

317

648

965

Intangible assets

-

                  -

147

147

Goodwill

1,338

-

-

1,338

PPE

-

-

6

6

 

 

 

 

 

 

30 June 2015 (unaudited)

 

Jersey

 

Singapore

 

Malaysia

 

Total

 

£'000

£'000

£'000

£'000

Revenue

-

292

412

704

Intangible assets

-

                  -

147

147

Goodwill

1,338

-

-

1,338

PPE

-

-

71

71

 

31 Dec 2015 (audited)

 

Jersey

 

Singapore

 

Malaysia

 

Total

 

£'000

£'000

£'000

£'000

Revenue

3

539

998

1,540

Intangible assets

-

-

194

194

Goodwill

1,338

-

-

1,338

PPE

-

-

35

35

 

6.     Share capital

 

MGL have one class of ordinary share capital which carry no rights to fixed income, any preferences or restrictions.

 

Authorised share capital (unaudited):

         

30 June 2016

30 June 2015

31 December 2015

 

£'000

£'000

£'000

Authorised:

 

 

 

200,000,000 Ordinary Shares of 5p each

10,000

10,000

10,000

Issued:

 

 

 

121,492,004 Ordinary Shares of 5p each

6,074

6,074

6,074

 

7.    Foreign currency exchange rate

 

       The following significant exchange rates applied during the period:

 

 

Average Rate

Reporting Date

£1 : SGD

1.9626

1.8082

£1 : MYR

5.7529

5.3971

£1 : HKD

12.1386

10.3926

 

8.   Nature of financial information

 

These interim results will be available shortly on the Company's website, www.medilink-global.com in accordance with the AIM Rules. Further copies can be obtained from the registered office at Queensway House, Hilgrove Street, St Helier, Jersey JE1 1ES.

 

9.   Nature of financial information

 

There are no seasonal factors that materially affect the operations of any company in the Group.

 

- Ends -


This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
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