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SCISYS set to 'comfortably' meet current expectations

By Josh White

Date: Tuesday 23 Jan 2018

SCISYS set to 'comfortably' meet current expectations

(ShareCast News) - Bespoke software systems provider SCISYS issued a trading update for the year to 31 December on Tuesday, prior to entering into its close period.
The AIM-traded firm said it expected its trading results to "comfortably" meet current market guidance, both in respect of revenues and adjusted operating profit.

It said its overall order book was at record levels and strong across all sectors, bolstered by its €18m contract win with OHB System to deliver the ground-station control and communications infrastructure for the German national satellite-communications mission, Heinrich Hertz.

The directors noted that the strong organic growth enjoyed at the end of 2017 was continuing into 2018.

SCISYS' cash flow was said to be "particularly healthy", with the net debt position as at 31 December better than expected at £5.9m.

The company's integration with ANNOVA was said to be progressing steadily.

"As we enter our final ring-fencing year with ANNOVA, we see cross selling and synergies between ANNOVA and our Media & Broadcast division continue to bear fruit, as evidenced by contract wins with both MDR and RTL, respectively," the board said in its statement.

MDR is a German public broadcaster and had been a customer for M&B since 1994.

RTL France had also been a long-standing customer with ANNOVA, and was a large commercial customer for the SCISYS M&B division and their first in France.

"We have started a programme to align ANNOVA's internal processes with SCISYS' high standards," the board added.

"ANNOVA completed a key milestone for its long-term supply contract with the BBC, for the supply of its OpenMedia software as announced on 9 August."

The group said it has in place intra-group currency-hedging arrangements to mitigate the risk of exchange-rate fluctuations, and as such did not anticipate any major impact from exchange-rate movements in 2018.

As it had previously announced, SCISYS was continuing to explore a range of Brexit contingency plans and options to protect shareholder value.

"The positive news flow across the year on new business wins was crowned by the announcement in late October of the the award of the contract to deliver the ground station control and communications infrastructure for Heinrich Hertz directly to OHB System AG, for the first time as prime contractor for the entire ground infrastructure," said board chairman Mike Love.

"Further contract wins across the group in the last quarter of 2017 mean that we are entering 2018 with positive momentum across all divisions."

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