Ffastfill plc : Preliminary Results for the twelve months ended 31 March 2012

The Board of FFastFill plc (LSE: FFA), the leading provider of Software as a Service ("SaaS") to the global derivatives community, announces Preliminary Results for the twelve months ended 31 March 2012.

Financial Highlights

* Before share based payment charges of £0.5m (FY10/11: £0.1m), acquisition costs of £0.3m (FY10/11: £nil), exceptional items of £0.1m (FY10/11: £0.3m) and (in the case of adjusted operating profit) amortisation of acquired intangibles of £0.3m (FY10/11: £nil).

Operational Highlights

Commenting on the results FFastFill Executive Chairman, Keith Todd CBE said:

"This has been a good year for FFastFill in which we have made a number of very important advances. Our global SaaS strategy and the breadth of our service offering continue to serve us well and we have completed two important and successful acquisitions during the year, WTD Consulting and Spread Intelligence, which strengthen that offering further and have already resulted in new business wins.

We start the new financial year with a healthy order book and we will continue to focus on driving profitable growth. Whilst it is still early in the financial year, the strength of our order book and the success delivered this year combine to underpin our expectations for the financial year ahead and we look forward to a year of further financial and operational progress."

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Chairman's Statement

This has been a good year for FFastFill. We have delivered a sound financial performance, generating strong growth in our core Software-as-a-Service ("SaaS") revenue stream and closing the year with a robust and encouraging total order book of £20.7m which includes a SaaS order book of £13.9m. This growth has been driven by a number of factors, perhaps the most important being the number of new contract wins secured during the year from our increasingly international customer base. These customers are not only organic FFastFill 'wins', but also new customers brought to us through the two acquisitions we have made in the past twelve months: both of which are now fully integrated with FFastFill and working as one enlarged and energised team.

At the time of our interim results in November, I commented that it was becoming increasingly clear to me that one of FFastFill's biggest assets was its global capability. The progress we have made in the second half of this year confirms that view.

There can be little doubt that, at a macro level, events such as the fall-out from MF Global continue to change the shape of the market in which we operate. Not only do they change its shape, but they also - albeit less than in previous years - inject new uncertainty. Nevertheless, FFastFill continues to navigate this changing market effectively and with confidence. On the ground, business continues to be transacted. Budgets remain in place. Decision makers within our industry continue to invest in the new technologies necessary if they are to stay ahead of their competitors. It is our strengthened global platform that enables us to keep on benefiting from these trends.

Three key pillars combine to underpin our platform. One of those pillars is SaaS, which continues to position us as a reliable supplier of new technology at a competitive price point. The second pillar is our geographic reach, which now spans Europe, the US and Asia. It is no coincidence that some of this year's most significant new customer mandates require us to deliver services in each of these continents and across multiple sites: an offering that would not exist without the investments we have made in the past three years. The third pillar is the breadth of our offering. This year's new customer wins have validated our ability to offer a full front-to-back service, which has itself been further enhanced by the technologies and capabilities brought to us by the teams at WTD and Spread Intelligence.

Looking ahead, as the shape of our market continues to evolve, so too does our competitive landscape, opening up new opportunities for us to win market share. Against this backdrop, FFastFill starts the new financial year in a strong position. Our order book is healthy, our offering remains highly competitive, and we now have new and additional cross-sell opportunities open to us. Whilst it is still early in the financial year, each of these factors combines to underpin our expectations for the financial year ahead and we look forward to a year of further financial growth and operational progress.

Keith Todd CBE
Executive Chairman

Chief Executive's Review

Expanding the FFastFill platform

This financial year has been both exciting and rewarding for the FFastFill team. Both through organic means and by capitalising on sensible acquisition opportunities we have strengthened our global footprint, extended our capabilities in a manner that appeals to new and existing customers and, importantly driven strong growth in the order book.

I am particularly encouraged by the positive effect our two acquisitions have had on our business this year. Both WTD Consulting, Inc. and Spread Intelligence have gone from being potentially exciting targets to integrated parts of an enlarged FFastFill platform. Each organisation has added new capabilities to our offering, new perspectives on the market opportunity open to us and, crucially, new customers. We look forward to realising further value from these acquisitions in the financial year ahead.

I am pleased to report a revenue performance of £17.2m (FY10/11: £15.5m) which includes SaaS growth of 13 percent year on year. Our decision to invest in infrastructure in the first half has enabled us to win new business and as a result the full year order book of £20.7m shows good growth. Adjusted Operating Profit for the full year stood at £1.9m, in line with our expectations. These numbers are a clear indication of FFastFill's long-term growth potential and of the flexibility in our business model.

Strong customer progress

We have signed 23 new functional mandates globally during the year, drawn from across 19 customers, of which 10 are new customer names. We have added customers across each of the front, middle and back office service lines we operate and seen a strong, early contribution from our acquired companies. Furthermore, we are now beginning to see the very real benefits of being a globally distributed and globally capable organisation. An increased proportion of this year's new customer wins, when compared to last year, involve FFastFill delivering one or more services to a client across two or more geographies:

FFastFill has made particularly significant and exciting progress this year in the Front Office. The acquisition of Spread Intelligence, a provider of highly sophisticated spread trading tools, is the single largest example of this progress. Spread Intelligence enhances FFastFill's own Front Office capabilities, particularly in the US, and the new combination is already proving popular with customers.

During the first half of the year, we secured a number of Front Office contracts - such as with FC Stone. During the second half that momentum has continued, including wins with RJ O'Brien in the United States and EDF Man and Tullet Prebon. UBS has contracted to extend our relationship from an Asian deployment into other geographies. Singapore based UOB has also contracted for global services.

A major European bank has extended its existing services in middle and back office to take a full front to back solution thus realising the efficiency gains to be had from straight through processing with one provider.

We have made significant progress in terms of developing and growing sales of risk management during the financial year, such as the addition of G. H. Financials as a customer for our RiskPro service and the deployment at EDF Man which includes RiskPro services integrating our margin capabilities into its risk management analysis. Both wins were strong competitive wins. Gator Trading in the United States has also contracted for this product demonstrating the geographic spread and strength of the product.

Further, the implementation of the VaR calculator for the NYPC Prime project in the USA was an example of being able to apply our SaaS principles and core architectural expertise to a project in the risk management space.

Horizon, our multi broker solution, continues to be a catalyst for increased customer relationships within our global SaaS platform. Leveraging the operational benefits of our diverse infrastructure, together with our risk management and order routing capabilities, Horizon is enabling our customers to access execution venues around the globe. It will continue to drive growth next year and beyond.

We continue to extend and upgrade connectivity to markets and during the year this included the Hong Kong Mercantile Exchange, ICE Multicast, NYSE, Euronext Liffe UTP Drop Copy, GovEx, Eris Exchange, FX Edge, and the LME 7 Upgrade.

We have also continued to expand our data centre footprint with both Chicago Mercantile Exchange proximity facilities at Aurora outside Chicago and the Australian Liquidity Centre for Australian Stock Exchange co-location being added to the infrastructure. We have also added the London Metal Exchange proximity locations to our platform. This enables low latency access to market for our products and for customer deployments. We are seeing a more significant percentage of order flow being synthetic order types managed by our systems and the reduced latency of co-location has enabled growth in this space.

The middle office product suite, SEALS, continues to be functionality rich and competitively very strong. The addition of the Prysm capabilities from the WTD Consulting acquisition has extended the product especially in the US market. SEALS is architecturally very strong, enabling global access to clearing of trades and allowing that access to be easily and efficiently devolved to customers.

Contract wins have included Bank of America Merrill Lynch and ICAP Australia among others. Extensions to existing mandates have also been secured with Mizuho, Philip Securities, Advantage Futures and Royal Bank of Canada.

From a functional perspective, we have added FIX interface capabilities as well as connectivity to new markets. New market connectivity includes Nasdaq Commodities Exchange, MGEX, NYPC, and TOCOM as well as migrations of existing connectivity to market.

The Acquisition of the business and assets of WTD Consulting, Inc., which completed on 30 November 2011, represents the most significant development this year in FFastFill's Back Office suite. By harnessing WTD's people and technology, we are now able to complete the customisation required to take our Back Office product and service, "Eclipse," in to the important US market. Work on this project has begun and we will continue throughout FY13.

During the year, we have added new mandates to our Back Office customer list as well as renewals and extensions of existing mandates. We have also continued to make progress with the three delayed Back Office implementations referenced in our first half results. One of these implementations is now fully live and delivering service to customers. The remaining implementations are in final acceptance testing. All three have added valuable functional capability to the core product in new geographies as well as functional areas.

FC Stone was a landmark win during the year for a full front to back solution for their metals business. They are a highly respected name in the space and we are thrilled to be doing this business with them.

Strategic intent

Our strategic focus remains unchanged. Our key goal is to drive growth, globally, across our SaaS-based operational platform. The acquisitions we have completed and integrated this year have helped us to move further forward in this regard, either by strengthening our hand in key growth markets such as the United States, or by extending the range of services we can offer and supporting our ability to offer one customer multiple products in multiple geographies at any one time. We will continue to pursue this strategy, largely by organic means, but we will also continue to consider possible acquisitions where a new technology or team could meaningfully strengthen our platform.

The Over the Counter ("OTC") arena continues to evolve. Whilst it does so, we watch it carefully, continuing to believe that being a 'fast-follower' in the emerging centrally cleared arena is the right position to take. The regulatory changes and debate around this issue continue to take shape. Whilst no one company can easily influence the outcome of this debate, once settled it will give those of us operating in the industry a clear view of where and how to create effective technology solutions. When that happens, we will be well placed to act quickly.

Our growing team

Our reputation for excellent service depends on the professionalism, commitment and hard work of the team that delivers it. This year, the FFastFill team has grown in size and so I would particularly like to welcome those who have joined us this year through acquisition. On behalf of the Board, thank you to all of our employees right across our global organisation for the role you have each played in delivering this year's successful performance and for the strong position we find ourselves in as we look ahead to the coming year.

Summary

The arena and environment we operate in continues to change. It remains our view that these changes will lead to new opportunities for FFastFill to grow further; both in terms of what we are able to offer to customers, but also ultimately to grow market share. We are in a strong position to take advantage of those opportunities. We have achieved a great deal this year in terms of customer growth, acquisition integration and service enhancement. With a strong order book, a competitive offering and opportunity ahead, we remain confident in our expectations for the coming financial year and we look forward to twelve months of further financial and operational progress.

Hamish Purdey
Chief Executive Officer

Financial Review

Revenue

Revenue for the year increased by 11% to £17.2m (FY10/11: £15.5m) as a result of growth in global SaaS revenue from our Front and Middle Office products as well as the acquisition of the business and assets of WTD Consulting, Inc ("WTD") in November 2011. SaaS revenue increased by 13% to £13.6m (FY10/11: £12.1m).

The twelve month order now book stands at £20.7m (FY10/11: £13.8m) of which £13.9m (FY10/11: £11.4m) is SaaS. The increase in the twelve month order book is due to the contract wins in the second half of the financial year as well as the acquisition of WTD.

EBITDA and Operating Profit

Adjusted EBITDA* for the year was £3.8m (FY10/11 £4.3m). Adjusted operating profit* for the year was £1.9m (FY10/11: £2.2m).

Total operating expenses in the year before acquisition costs, exceptional items and share based payments were £10.8m (FY 10/11: £9.5m). The year on year increase of £1.3m arose as a result of investment in staff and infrastructure costs as well as the impact of the acquisition of WTD. During the first half of the year, we undertook a Group wide cost optimisation review which drove cost efficiencies in the second half of the financial year.

Statutory operating profit was £0.6m (FY10/11: £1.8m) and is stated after charging share-based payment charges, exceptional items, acquisition costs and amortisation of acquired intangibles.

Share based payment charges in the year were £0.5m (FY10/11: £0.1m). The year on year increase of £0.4m arose as a result of share award schemes implemented during the year and the inclusion of the cost of share-based contingent consideration for WTD that is being accounted for as remuneration over the five year earn-out.

Exceptional items of £0.1m (FY10/11: £0.3m) comprise redundancy costs as a result of actions taken to drive cost efficiencies in the second half of the year and bad debt charges arising from customer bankruptcies.

Acquisition costs of £0.3m (FY10/11: £nil) and amortisation of acquired intangibles £0.3m (FY10/11: £nil) arose as a result of the Spread Intelligence and WTD acquisitions in the year.

Profit Before Tax

Profit before tax was £0.6m (FY10/11: £1.8m).

Profit After Tax

Profit after tax was £0.6m (FY10/11: £1.8m). The Group continues to recognise a deferred tax asset of £1.6m (FY10/11: £1.5m) in respect of tax losses accumulated in previous years.

Cash Flow

Cash flow from operations was £0.3m (FY10/11: £3.0m) and included an outflow of £3.0m (FY10/11: outflow of £0.8m) in respect of increased working capital as a result of the timing of invoicing in the second half of the year.

The Group has continued to invest in its infrastructure and product set to support revenue growth and incurred £0.6m of capital expenditure (FY10/11: £0.8m) and £2.2m (FY10/11: £1.9m) of capitalised investment in product development during the year.

The net cash outflow for the year was £1.0m (FY10/11: inflow £0.7m). At 31 March 2012 the Group was debt free and had cash of £2.2m (31 March 2011: £3.3m).

*Before share based payment charges, exceptional items, acquisition costs and (in the case of adjusted operating profit) amortisation of acquired intangibles as set out in the consolidated statement of comprehensive income.

Condensed Consolidated Statement of Comprehensive Income
for the twelve months ended 31 March 2012

		2012				2011
		£'000			£'000
Revenue		17,249			15,517
Cost of sales		(2,659)			(1,911)
Gross profit		14,590			13,606
Operating expenses		(11,781)			(9,876)
Other operating income		-			152
EBITDA*		2,809			3,882
Analysed as:
Adjusted EBITDA		3,823			4,281
Share-based payments		(549)			(115)
Acquisition costs		(333)			-
Exceptional items		(132)			(285)
EBITDA		2,809			3,882
Depreciation		(312)			(614)
Amortisation		(1,863)			(1,441)
Operating profit		634			1,827
Analysed as:
Adjusted operating profit		1,925			2,227
Share-based payments		(549)			(115)
Amortisation of acquired intangibles		(277)			-
Acquisition costs		(333)			-
Exceptional items		(132)			(285)
Operating profit		634			1,827
Finance income		40			4
Finance costs		(64)			(3)
Profit before taxation		610			1,828
Tax		(6)			(19)
Profit after taxation - attributable to the owners of the parent		604			1,809
Other comprehensive income, net of tax
Exchange translation differences on foreign operations		(74)			(18)
Total comprehensive income for the year -
attributable to the owners of the parent		530			1,791
Basic earnings per share		0.14p			0.46p
Fully diluted earnings per share		0.12p			0.44p

*EBITDA is defined as: Earnings before interest, taxes, depreciation and amortisation

Condensed Consolidated Statement of Financial Position
for the twelve months ended 31 March 2012

		2012		2011
		£'000		£'000
ASSETS
Non-current assets
Goodwill Intangible assets Property, plant and equipment Deferred taxation		10,766 8,989 1,191 1,553		7,784 4,478 955 1,459
		22,499		14,676
Current assets
Trade and other receivables		7,663		4,217
Cash and cash equivalents		2,196		3,257
		9,859		7,474
TOTAL ASSETS		32,358		22,150
LIABILITIES
Current liabilities
Trade and other payables		(7,919)		(6,645)
Current assets less current liabilities		1,940		829
Total assets less current liabilities		24,439		15,505
Non-current liabilities
Trade and other payables		(20)		(665)
Contingent consideration		(1,383)		-
NET ASSETS		23,036		14,840
EQUITY
Share capital		4,770		4,013
Share premium account		6,124		287
		860		235
		(22)		-
		832		363
Merger reserve		890		890
Currency translation reserve		(78)		(4)
Retained earnings		9,660		9,056
Equity attributable to the owners of the parent company		23,036		14,840

Condensed Consolidated Statement of Changes in Equity
for the twelve months ended 31 March 2012

		Share capital		Share premium account		Own shares		Other reserves		Share- based payment reserve		Merger reserve		Translation reserve		Retained earnings		Total
		£'000		£'000		£'000		£'000		£'000		£'000		£'000		£'000		£'000
Balances at 1 April 2010		3,970		19		-		235		248		890		14		7,247		12,623
		-		-		-		-		-		-		-		1,809		1,809
Profit for the year
Other comprehensive income		-		-		-		-		-		-		(18)		-		(18)
Exchange translation differences on foreign operations
Total comprehensive income for the year		-		-		-		-		-		-		(18)		1,809		1,791
Transactions with owners
Share-based payment		-		-		-		-		115		-		-		-		115
Shares issued		43		268		-		-		-		-		-		-		311
Total transactions with owners		43		268		-		-		115		-		-		-		426
Balance at 31 March 2011		4,013		287		-		235		363		890		(4)		9,056		14,840
Profit for the year		-		-		-		-		-		-		-		604		604
Other comprehensive income
Exchange translation differences on foreign operations		-		-		-		-		-		-		(74)		-		(74)
Total comprehensive income for the year		-		-		-		-		-		-		(74)		604		530
Transactions with owners
Share-based payment		-		-		-		-		469		-		-		-		469
Shares issued		757		5,837		-		-		-		-		-		-		6,594
Own shares acquired in the period		-		-		(22)		-		-		-		-		-		(22)
Contingently issuable shares		-		-		-		625		-		-		-		-		625
Total transactions with owners		757		5,837		(22)		625		469		-		-		-		7,666
Balance at 31 March 2012		4,770		6,124		(22)		860		832		890		(78)		9,660		23,036

Condensed Consolidated cash flow statement
for the twelve months ended 31 March 2012

		2012		2011
		£'000		£'000
Cash flows from operating activities
Cash flows from operations		298		3,031
Interest received		1		4
Interest paid		(15)		(3)
Tax paid		(24)		(19)
Net cash flows from operating activities		260		3,013
Cash from investing activities
Purchase of intangible assets Purchase of property, plant and equipment		(2,218) (571)		(1,900) (750)
Net proceeds from sale of investment		-		157
Acquisition of businesses		(71)		-
Net cash flows used in investing activities		(2,860)		(2,493)
Cash flows from financing activities
Net proceeds from issue of ordinary share capital		1,533		311
New bank loans raised		1,290		-
Repayment of borrowings		(1,250)		(125)
Net cash flows from financing activities		1,573		186
Net change in cash and cash equivalents		(1,027)		706
Exchange rate movement		(34)		3
Cash and cash equivalents at beginning of year		3,257		2,548
Cash and cash equivalents at end of year		2,196		3,257

Reconciliation of profit/(loss) after taxation to net cash flows from operating activities

		2012		2011
		£'000		£'000
Profit after taxation		604		1,809
Finance income		(40)		(4)
Finance costs		64		3
Taxation		6		19
Profit on sale of investment		-		(152)
Depreciation		312		614
Loss on disposal of fixed asset		20		-
Amortisation of intangible assets		1,863		1,441
Share based payment		469		115
Foreign exchange translation differences		(8)		(27)
Increase in receivables		(3,289)		(1,248)
Decrease in payables		297		461
Cash flows from operating activities		298		3,031

Basic earnings per share and fully diluted earnings per share

			Year to March 2012		Year to March 2011
Basic earnings per share
Profit attributable to shareholders			£604,000		£1,809,000
Share-based payment			£549,000		£115,000
Amortisation of acquired intangibles			£277,000
Acquisition costs			£333,000		-
Exceptional items			£132,000		£285,000
Adjusted profit attributable to shareholders			£1,895,000		£2,209,000
Weighted average number of shares			434,694,437		397,523,873
Diluted earnings per share
Weighted average number of shares			434,694,437		397,523,873
Effect of share options			46,709,852		11,253,821
Effect of contingently issuable shares			5,116,346		-
Fully diluted weighted average number of ordinary shares			486,520,635		408,777,694
Basic earnings per share			0.14p		0.46p
Fully diluted earnings per share			0.12p		0.44p
Adjusted basic earnings per share			0.44p		0.55p
Fully diluted adjusted earnings per share			0.39p		0.54p

Basis of preparation

The financial information set out above does not constitute the Company's statutory accounts for the years ended 31 March 2012 or 2011, but is derived from those accounts. Statutory accounts for FY10/11 have been delivered to the Registrar of Companies and those for FY11/12 will be delivered following the Company's Annual General Meeting. The auditors have reported on those accounts; their reports were unqualified, did not draw attention to any matters by way of emphasis without qualifying their report and did not contain statements under s498(2) or (3) of the Companies Act 2006. Whilst the financial information included in this preliminary announcement has been computed in accordance with International Financial Reporting Standards (IFRSs) adopted by the European Union ("EU") and in accordance with the Group's IFRS accounting policies, this announcement does not itself contain sufficient information to comply with IFRSs. The financial information presented in this announcement has been prepared in accordance with the accounting policies adopted for the audited results for the year ended 31 March 2012 and 31 March 2011.

The financial information set out in this preliminary announcement was approved by the Board of Directors and authorised for issue on 28th May 2012.

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