Result of General Meeting

30 September 2019

STILO INTERNATIONAL PLC
(the “Company”)

Result of General Meeting

The General Meeting of Stilo International plc was held at the offices of RSM UK Audit LLP, 25 Farringdon Street, London EC4A 4AB on 30 September 2019 at 11:00 a.m.

All four resolutions put to members were passed. Resolutions 1 and 2 were passed as ordinary resolutions and resolutions 3 and 4 were passed as special resolutions.

ENQUIRIES

Stilo International plc
Les Burnham, Chief Executive
T +44 1793 441 444

SPARK Advisory Partners Limited (Nominated Adviser)
Neil Baldwin T +44 203 368 3554
Mark Brady  T +44 203 368 3551

SI Capital (Broker)
Nick Emerson
T +44 1483 413500

The number of votes lodged by proxy for and against each of the resolutions proposed, and the number of votes withheld was as follows:

Resolution

Votes for

%

Votes against

%

Chairman’s Discretion

%

Votes withheld

Resolution 1 (Ordinary)

To approve the Brewin Nominees Purchase Contracts and to authorise the Company to make off market purchases

 

 

12,221,300

99.89%

 

 

11,022

0.09%

 

 

2,852

0.02%

15,265,359

Resolution 2 (Ordinary)

To approve the Purchase Contract and to authorise the Company to make off market purchases

 

 

27,486,659

99.95%

 

 

11,022

0.04%

 

 

2,852

0.01%

0

Resolution 3 (Special)

To approve cancellation of the AIM Listing for the Ordinary Shares

 

 

27,486,659

99.95%

 

 

11,022

0.04%

 

 

2,852

0.01%

0

Resolution 4 (Special)

To approve the re-registration of the Company as a private limited company and to adopt new articles of association

 

 

27,486,659

99.95%

 

 

11,022

0.04%

 

 

2,852

0.01%

0

 

Shareholders are entitled to one vote per share. Votes withheld are not votes in law and so have not been included in the calculation of the proportion of votes for and against a resolution.

As a result of the approval of the resolutions:

  • the cancellation of the admission to trading of the Ordinary Shares on AIM (the “De-Listing”) will take effect from 8:00 a.m. on 8 October 2019;
  • the buyback (“Buyback”) of 15,265,359 Ordinary Shares in aggregate from Brewin Nominees Limited, BDS Nominees Limited and Giltspur Nominees Limited at 1 pence per Ordinary Share will complete on 3 October 2019;
  • the tender offer, the result of which was announced on 16 September 2019, will complete on 3 October 2019 (the “Tender Offer”);
  • the Current Articles have been replaced by the New Articles; and
  • the re-registration of the Company as a private limited company (the “Re-registration”) is expected to take place by 29 October 2019.

Total Voting Rights

Following completion of the Tender Offer and the Buyback, whereby 15,776,069 shares will be cancelled, the Company’s issued share capital will comprise 98,154,401 Ordinary Shares with voting rights. The figure of 98,154,401 Ordinary Shares may therefore be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change in their interest in, the share capital of the Company under the FCA’s Disclosure Guidance and Transparency Rules.

Capitalised terms in this announcement (unless otherwise defined) have the same meanings as set out in the Circular dated 23 August 2019.


Proposed Buyback, Tender Offer and De-Listing

23 August 2019

STILO INTERNATIONAL PLC
(the “Company”)

The Company today announces that a circular (the “Circular”) will be sent to Shareholders later today detailing the following proposals: 

  • the proposed cancellation of the admission to trading of the Ordinary Shares on AIM (the “De-Listing”);
  • the proposed buyback of 15,265,359 Ordinary Shares in aggregate from Brewin Nominees Limited, BDS Nominees Limited and Giltspur Nominees Limited at 1 pence per Ordinary Share;
  • a tender offer, closing at 1.00 pm on 13 September 2019, for up to 14,734,641 Ordinary Shares representing approximately 14.93 per cent of the Ordinary Shares in issue following the buyback of Ordinary Shares from Brewin Nominees Limited, BDS Nominees Limited and Giltspur Nominees Limited at 1 pence per Ordinary Share (the “Tender Offer”); 
  • the proposed re-registration of the Company as a private limited company (the “Re-registration”); and 
  • the replacement of the Current Articles with the New Articles.

The Circular sets out the terms of the Buyback, the Tender Offer and incorporates a notice of a General Meeting to be held on 30 September 2019 at which resolutions to approve the Proposals will be proposed.

Buyback

Holding 13.40 per cent of the voting rights, Brewin Nominees, BDS Nominees and Giltspur Nominees have agreed to support the Company’s De-Listing on the basis that the Company will buy back the Brewin Nominees Shares at the Tender Offer Price.

Under the Brewin Nominees Purchase Contracts, the Company has conditionally agreed to purchase the Brewin Nominees Shares at 1 pence per Ordinary Share. The Company’s purchase of the Brewin Nominees Shares pursuant to the Brewin Nominees Purchase Contracts is, inter alia, conditional on the Brewin Nominees Purchase Contracts being authorised by a shareholders’ resolution (Resolution 1), at which Brewin Nominees, BDS Nominees and Giltspur Nominees will not vote their shares.

Tender Offer

The Board recognises that not all Ordinary Shareholders will be able or willing to continue to own Ordinary Shares following the De-Listing.  Subject to the Tender Conditions being satisfied, Qualifying Shareholders will therefore have the opportunity to tender all or some of their Ordinary Shares at the Record Date pursuant to the Tender Offer.

Under the Tender Offer, the Company will purchase up to 14,734,641 Ordinary Shares (representing approximately 14.93 per cent of the Ordinary Shares in issue following the buyback of the Brewin Nominees Shares) from Qualifying Shareholders at 1 pence per share. The Tender Offer Price represents:

  • a discount of approximately 31 per cent. over the closing mid-market price of an Ordinary Share on 22 August 2019, being the last dealing day before the date of this announcement; and  
  • a discount of approximately 23 per cent. over the 30 day volume weighted average share price of an Ordinary Share on 22 August 2019, being the last dealing day before the date of this announcement.

De-Listing

Pursuant to Rule 41 of the AIM Rules, the Directors have notified the London Stock Exchange of the intention to cancel the admission of Ordinary Shares to trading on AIM, subject to Shareholder approval. Under the AIM Rules, it is a requirement that the De-Listing is approved by the requisite majority of Shareholder voting (being not less than 75. per cent of the votes cast).

Subject to the resolutions approving the De-Listing and the Re-registration being passed, it is anticipated that the De-Listing will become effective on 8 October 2019 and the Re-registration will take effect on 29 October 2019.

Further details of the proposals are set out below.

EXPECTED TIMETABLE

Announcement of proposed De-Listing and Tender Offer, posting of this document, Proxy Form and Tender Form to Shareholders and Tender Offer opens Friday 23 August 2019
Closing of Tender Offer  – Latest time and date for receipt of Tender Forms and TTE Instructions in relation to the Tender Offer 1.00 pm on Friday 13 September 2019
Record Date for Tender Offer 6.00 pm on Friday 13 September 2019
Announcement of results of Tender Offer Monday 16 September 2019
Purchase Contract and Brewin Nominees Purchase Contracts available for inspection From Monday 16 September to Monday 30 September 2019
Latest date for receipt of Proxy Form (to be received no later than 48 hours before the General Meeting) Saturday 28 September 2019
General Meeting 11.00 am on Monday 30 September 2019
Announcement of the results of General Meeting Monday 30 September 2019
Purchase of Tender Offer Shares and Brewin Nominees Shares Thursday 3 October 2019
Cancellation of Tender Offer Shares and Brewin Nominees Shares Thursday 3 October 2019
Despatch of cheques for Tender Offer proceeds Thursday 3 October 2019
CREST accounts credited with Tender Offer proceeds and proceeds of acquisition of Brewin Nominees Shares Thursday 3 October 2019
Despatch of share certificates in respect of any revised holdings of Ordinary Shares following the Tender Offer, and any Ordinary Shares held in CREST not tendered pursuant to the Tender Offer Thursday 3 October 2019
De-Listing and cancellation of admission of the Ordinary Shares to trading on AIM Tuesday 8 October 2019
Re-registration of the Company as a private limited company Tuesday 29 October 2019

 If any of the above times and/or dates change, the revised times and/or dates will be notified to Shareholders by announcement through a Regulatory Information Service.

All times are references to London time.

All events in the above timetable following the GM are conditional, inter alia, upon the approval of the Resolutions.

The De-Listing requires the approval of not less than 75 per cent. of the votes cast by Shareholders at the General Meeting.

Capitalised terms in this announcement (unless otherwise defined) have the same meanings as set out in the Circular.

Read the full Proposed Buyback, Tender Offer and De-Listing News Posting

Download the General Meeting Circular 23 August 2019

ENQUIRIES

Stilo International plc
Les Burnham, Chief Executive
T +44 1793 441 444

SPARK Advisory Partners Limited (Nominated Adviser)
Neil Baldwin T +44 203 368 3554
Mark Brady  T +44 203 368 3551

SI Capital (Broker)
Nick Emerson
T +44 1483 413500


Unaudited interim results for six months ended 30 June 2019

23 August 2019

STILO INTERNATIONAL PLC

Stilo International plc (“Stilo”, the “Group” or the “Company”) today announces its unaudited Interim Results for the six months ended 30 June 2019. The Company provides software tools and cloud services that help organisations create and process structured content in XML format, so that it can be more easily stored, managed, re-used, translated and published to multiple print and digital channels.

FINANCIAL HIGHLIGHTS

  • Reduction in sales revenues to £638,000 (2018: £707,000)
  • Operating costs remain level £656,000 (2018: £657,000), excluding capitalised development costs for AuthorBridge of £110,000 (2018: £99,000)
  • Loss before tax for the period of £29,000 (2018: £42,000 profit)
  • Total comprehensive income for the period remained positive at £14,000 (2018: £5,000) subsequent to favourable foreign currency translation differences
  • Cash of £1,096,000 as at 30 June 2019 (2018: £1,442,000)
  • No interim dividend declared

BUSINESS HIGHLIGHTS

  • Migrate customers for the period include Mastercard, ARRIS/CommScope, Applied Materials, Visa, GE Healthcare and Deltek.
  • AuthorBridge customers in the US include IBM, Kaplan Professional Education and the Nuclear Regulatory Commission. A major release of AuthorBridge shipped in June 2019 and it is not expected to further capitalise AuthorBridge development costs beyond this date.
  • OmniMark sales include European Parliament, Qantas and Embraer.

David Ashman, Chairman, commenting on the Company’s performance, stated:

In our Trading Update of 23 May 2019 we indicated that sales were slower than planned and that a loss was expected for the half-year period.

We are currently expecting trading to continue slowly for the remainder of 2019 and need to take measures to reduce our operating costs wherever possible. Of primary importance is the proposal to de-list from AIM and re-register as a private limited company, subject to shareholders’ approval. This is the subject of an associated announcement issued immediately following the release of these interim results and is expected to generate potential annualised cost savings of over £120,000. Additional cost-reduction activities include organisational and management changes that are currently underway.

The Company continues to develop high-quality software tools used by leading organisations around the world. With a reduced cost base and increased sales to be driven by the recruitment to the newly created role of VP Sales & Marketing, it is our intention to generate steady ongoing profits and resume the payment of dividends to shareholders as soon as possible.

Download a PDF of the 2019 Interim Results, including the Group Income Statement.

ENQUIRIES

Stilo International plc
Les Burnham, Chief Executive
T +44 1793 441 444

SPARK Advisory Partners Limited (Nominated Adviser)
Neil Baldwin T +44 203 368 3554
Mark Brady  T +44 203 368 3551

SI Capital (Broker)
Nick Emerson
T +44 1483 413500


Result of AGM 23 May 2019

23 May 2019

STILO INTERNATIONAL PLC

The Annual General Meeting of Stilo International plc was held at the offices of RSM UK Audit LLP, 25 Farringdon Street, London EC4A 4AB earlier today.

All 6 resolutions put to members were passed. Resolutions 1 to 4 were passed as ordinary resolutions and resolutions 5 and 6 were passed as special resolutions.

The number of votes lodged by proxy for and against each of the resolutions proposed, and the number of votes withheld was as follows:

 Resolution

Votes for

%

Votes against

%

Votes withheld

Resolution 1 (Ordinary)

To receive and adopt the Directors’ Report and Accounts for the year ended 31 December 2018

42,397,973

100

0

0

0

Resolution 2 (Ordinary)

To approve the final dividend for the year ended 31 December 2018

42,397,973

100

0

0

0

Resolution 3 (Ordinary)

To reappoint RSM UK Audit LLP as Auditors to the Company and to authorise the Directors to fix their remuneration

42,397,973

100

0

0

0

Resolution 4 (Ordinary)

To authorise the Directors to allot relevant securities

42,397,973

100

0

0

0

Resolution 5 (Special)

To authorise the Directors to allot equity securities and to disapply statutory pre-emption rights in relation to the issue of certain equity securities

42,177,973

99.48

220,000

0.52

0

Resolution 6 (Special)

To authorise the Directors to purchase ordinary shares

42,397,973

100

0

0

0

As at 23 May, 2019, there were 113,930,470 ordinary shares in issue. Shareholders are entitled to one vote per share. Votes withheld are not votes in law and so have not been included in the calculation of the proportion of votes for and against a resolution.

ENQUIRIES

Stilo International plc
Les Burnham, Chief Executive
T +44 1793 441 444

SPARK Advisory Partners Limited (Nominated Adviser)
Neil Baldwin T +44 203 368 3554
Mark Brady  T +44 203 368 3551

SI Capital (Broker)
Nick Emerson
T +44 1483 413500


Trading Update

23 May 2019

STILO INTERNATIONAL PLC

Stilo International plc (“Stilo” or the “Company”) today provides a trading update. The Company develops software tools and cloud services that help organisations create and process structured content in XML format so that it can be more easily stored, managed, re-used, translated and published to multiple print and digital channels.

In the Company’s 2018 Preliminary Results, announced on 14 March 2019, we indicated that the outlook for 2019 was uncertain. Albeit the Company is involved in several new contract bids that could materialise later in 2019, the Company expects to report a material drop in revenue and a loss for the six-month period ending 30 June 2019, as sales have been slower than planned.

Given the ongoing trading uncertainty, it is important that we reduce our operating costs and we will be taking appropriate measures to do so in the coming weeks.

ENQUIRIES

Stilo International plc
Les Burnham, Chief Executive
T +44 1793 441 444

SPARK Advisory Partners Limited (Nominated Adviser)
Neil Baldwin T +44 203 368 3554
Mark Brady  T +44 203 368 3551

SI Capital (Broker)
Nick Emerson
T +44 1483 413500


Preliminary announcement of results for year ended 31 December 2018

14 March 2019

STILO INTERNATIONAL PLC

Stilo International plc (“Stilo”, the “Group” or the “Company”) today announces its results for the year ended 31 December 2018. The Company develops software tools and cloud services that help organisations create and process structured content in XML format so that it can be more easily stored, managed, reused, translated and published to multiple print and digital channels.

FINANCIAL HIGHLIGHTS

  • Sales revenues of £1,487,000 (2017: £1,894,000).
  • Profit after tax of £177,000 (2017: £313,000).
  • Reduction in operating costs, net of capitalised development costs, to £1,358,000 (2017: £1,591,000), primarily due to favourable currency exchange rates.
  • Investment in total product development of £583,000 (2017: £656,000) of which £213,000 capitalised (2017: £213,000).
  • Cash of £1,271,000 as at 31 December 2018 (2017: £1,621,000), with reduction largely due to continued investment in development projects and dividend payments to shareholders.
  • Final dividend proposed of 0.06 pence per Ordinary Share, providing a total dividend of 0.12 pence for the year (2017: total 0.10 pence).

BUSINESS HIGHLIGHTS

  • Total sales revenues for the period decreased significantly, principally due to an expected reduction in OmniMark-related revenues from one major customer.
  • Migrate revenues held up well given the expiry of a significant contract from earlier years. Customers during the period included Edwards Lifesciences, Visa, Viewpoint, ARRIS, Synopsys, Deltek, Varian and TIBCO.
  • AuthorBridge beginning to get traction with new customers including Kaplan Professional, Intel and Coriolis.
  • Initiated the development of OptimizeR – a new tool to help customers deduplicate their DITA content, improve content consistency and maximise the opportunity for content reuse.

David Ashman, Chairman, commenting on the Company’s performance, stated:

“Total sales revenues for the period decreased significantly, principally due to an expected reduction in OmniMark-related revenues from one major customer. However, it was encouraging that our Migrate revenues held up well, as new customer wins compensated for the expiry of a major contract. We were also successful in making some initial breakthroughs with sales of AuthorBridge to new customers.

Given our size, we continue to incur significant financial overheads associated with being a public listed company, but notwithstanding this we were able to generate a post-tax profit for the period of £177,000.

The Company continues to invest in the development of leading technologies for the structured content market and in so doing build long-term value for shareholders. As we look forward to growing future sales, supported by healthy cash reserves and a strong balance sheet, I am pleased to announce the payment of an increased final dividend of 0.06 pence per share, providing a total dividend for the year of 0.12 pence”.

Download a PDF of the full 2018 preliminary results announcement.

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.


BUSINESS OVERVIEW

Stilo develops software tools and cloud services that help organisations create and process structured content in XML format, so that it can be more easily stored, managed, reused, translated and published to multiple print and digital channels.

Over recent years, many organisations have adopted industry specific XML standards e.g. Publishing (DocBook), Aerospace & Defence (S1000D), Finance (XBRL), Life Sciences (SPL), Scientific and Scholarly Publishing (JATS), Software and High Tech (DITA). Stilo made the decision some years ago to focus new product development and marketing efforts on the emerging DITA standard. This standard originated within IBM to support the publishing of its technical documentation and has been increasingly adopted by other software and high tech companies. DITA is now beginning to make inroads into additional market sectors including Manufacturing, Life Sciences and Publishing.

In early 2018 we undertook some exploratory development and marketing efforts for the JATS market but these were put on hold mid-year in order to focus resources on the major release of AuthorBridge v3 for the DITA market.

In the medium term, given limited resources, we will look to diversify beyond the DITA market through potential partnering opportunities and the incremental development of AuthorBridge, Migrate and OptimizeR.

We continue to build upon our strong reputation for excellent products and supporting technical expertise, resulting from many years of experience in the structured content marketplace. With offices in the UK and Canada, we support clients throughout North America, Europe and Japan.

PRODUCTS AND CUSTOMERS

OmniMark

Stilo’s core technology is OmniMark, a long-established development platform used to build high-performance content processing applications integral to enterprise publishing solutions.

Users include Pratt and Whitney, Airbus Defence & Space, Clarivate Analytics and Wolters Kluwer.

Sales for the year included orders from the European Parliament, Japan Patent Office, Qantas and Gulfstream.

Migrate

Migrate is the world’s first cloud XML content conversion service and utilises OmniMark technology. Through advanced levels of automation, it enables organisations to improve turnaround times, reduce operating costs and take direct control of their work schedules, providing an attractive alternative to traditional outsourced conversion services.

Migrate sales for the period include orders from Edwards Lifesciences, Visa, Viewpoint, ARRIS, Synopsys, Deltek, Varian and TIBCO.

Using Migrate, we have helped our customers convert over one million pages of content to the DITA standard.

OptimizeR

Complementing Migrate, OptimizeR is a tool that we are developing to help automate the deduplication of DITA content, improve content consistency and help maximise the opportunity for content reuse. This can be particularly important in highly regulated or hazardous environments.

In 2018 the tool was in the research and early development phase with all expenses recognised in the profit or loss. Initial customer testing is due to start in the coming months and we expect to make OptimizeR generally available to customers mid-year 2019.

AuthorBridge

AuthorBridge is a web-based XML authoring tool, designed for content contributors who have no knowledge of XML or its complexities. It is currently targeted at large enterprises, which are looking to extend the use of DITA across different business units and potentially support hundreds of users.

The development of AuthorBridge has been a major effort over several years, culminating in the release of AuthorBridge v3 in early 2019. This release helps position AuthorBridge at the forefront of web-based DITA editing tools, albeit there are some additional developments that we need to undertake to round it off. Its initial deployment in production at IBM, following extensive co-operation and testing by the central IBM Information Developer Tools team, serves as a good foundation upon which we can build future sales. Other early stage customers include the Nuclear Regulatory Commission, Intel, Kaplan Professional and Coriolis.

Sales analysis by geographic region

Our customers typically comprise large organisations, and are spread globally. Geographic sales revenues were derived as follows:

Region 2018 2017
UK 5% 2%
Rest of Europe 12% 12%
North America 62% 51%
South America 4% 3%
Asia 17% 32%

North America continues to represent a significant proportion of sales revenues as adoption of the DITA standard has been primarily led by corporations with their headquarters based in the USA. It is anticipated that adoption of the DITA standard will spread internationally over the coming years.

Technical expertise

Our technical team includes leading experts in the development of XML content processing technologies and along with our support services, are very highly regarded by customers.

There is a high level of synergy between our products which results in very efficient integrated development and support activities.

Operations

Stilo operates from offices located in Swindon, UK and Ottawa, Canada. The technical team is based in our Ottawa office.

As at 31 December 2018, there were 18 permanent employees in the Group, complemented by the use of contractors. It is not anticipated that we will be growing headcount significantly, as we look to contain our costs and scale the business through technology sales.

FINANCIAL RESULTS

The results for the year ended 31 December 2018 have been prepared in accordance with the recognition and measurement principles of International Financial Reporting Standards as adopted by the European Union.

In 2018, the results for Stilo show a decrease in EBITDA to £148,000 (2017: £315,000). Post tax profits were £177,000 (2017: £313,000).

Total sales revenues for the year decreased to £1,487,000 (2017: £1,894,000), principally due to an expected reduction in OmniMark-related revenues from one major customer.

The Group continued to benefit from recurring revenue from software maintenance contracts of £816,000 (2017: £930,000) which represents 55% (2017: 49%) of annual sales revenue.

The Group continues to maintain careful control over operating costs. Operating expenses, excluding capitalised development costs, were reduced to £1,358,000 (2017: £1,591,000). This decrease has been driven by a fall in staff costs and favourable currency exchange rates in the current year.

Investment in research and development continued in 2018, with total expenditure for the year of £583,000 (2017: £656,000). As a result of this investment, Stilo continues to benefit from research and development tax credits. Of this expenditure, £213,000 (2017: £213,000) relating to the development of AuthorBridge has been capitalised, and the total accumulated capitalised costs will be depreciated over a 10 year period, commencing in 2019.

There was a cash balance of £1,271,000 as at 31 December 2018 (31 December 2017: £1,621,000), with the reduction being largely due to continued investment in development projects and dividend payments to shareholders. Stilo remains entirely un-geared. This Statement of Financial Position stability provides a sound financial base for the Group and will support continued investment in product development, sales and marketing. Costs will continue to be carefully managed in order to maintain cash reserves at a satisfactory level.

Total trade receivables were £224,000 (2017: £126,000), equating to 55 days (2017: 24 days). Overdue amounts are closely monitored.

The directors monitor the performance of the Group based on the above key performance indicators.

DIVIDENDS

The Board recommends the payment of a final dividend for the year of 0.06 pence per Ordinary Share which, if approved by the shareholders at the AGM on 23 May 2019, will be paid on 30 May 2019 to shareholders on the register on the Record Date of 23 April 2019. The shares will be marked ex-dividend on 18 April 2019. If approved, payment of the final dividend will bring the total dividends paid to shareholders for the year to 0.12 pence per Ordinary Share.

The Board’s policy is to maintain payment of a steady and progressive dividend, well covered and paid subject to maintaining sufficient funds within the business with regard to prudent forecasts of future capital requirements, without the need for debt funding.

OUTLOOK

The long-awaited release of AuthorBridge v3 in 2019 provides for a best-in-class, web authoring tool for the DITA market. However, the DITA market has well-established competitors and it will likely take some time to build significant new revenue streams with customers and technology partners.
In the short term, growth will be primarily driven by sales of Migrate and OptimizeR solutions to new customers and we will be stepping up our sales, marketing and development efforts accordingly. 2019 is going to be a challenging year for the Company, with potential demand, as always, difficult to predict at the current time.

ENQUIRIES

Stilo International plc
Les Burnham, Chief Executive
T +44 1793 441 444

SPARK Advisory Partners Limited (Nominated Adviser)
Neil Baldwin T +44 203 368 3554
Mark Brady  T +44 203 368 3551

SI Capital (Broker)
Nick Emerson
T +44 1483 413500


Unaudited interim results for six months ended 30 June 2018

15 August 2018

STILO INTERNATIONAL PLC

Stilo International plc (“Stilo”, the “Group” or the “Company”) today announces its unaudited Interim Results for the six months ended 30 June 2018. The Company provides software tools and cloud services that help organisations create and process structured content in XML format, so that it can be more easily stored, managed, re-used, translated and published to multiple print and digital channels. 

FINANCIAL HIGHLIGHTS

  • Reduction in sales revenues to £707,000 principally due to the expiry of a 3 year customer contract for Migrate. (2017: £910,000)
  • Reduction in operating costs to £657,000. (2017: £759,000)
  • Post-tax profits of £42,000.  (2017: £142,000)
  • Cash of £1,442,000 as at 30 June 2018. (2017: £1,602,000)
  • Payment of an interim dividend of 0.06 pence per Ordinary Share. (2017:0.05 pence per share)

BUSINESS HIGHLIGHTS

  • Migrate customers for the period include Viewpoint, Arris, Synopsis, Deltek, Varian and Tibco.
  • AuthorBridge order win at Kaplan Professional Education, incorporating integration with the Componize for Alfresco content management system.
  • OmniMark sales include Toshiba Digital Solutions Corporation (Japan Patent Office), European Parliament, Qantas and Gulfstream.
  • Launch in July of professional service to assist DITA users to maximise content re-use, utilising OptimizeR, a new product currently under development.

David Ashman, Chairman, commenting on the Company’s performance, stated:

“Our total sales revenues for the period decreased significantly, principally due to the expiry of a three year customer contract for Migrate.  Changes to IFRS accounting rules in 2018 also had the effect of deferring £27,000 of software revenue recognition beyond the end of December 2017 and £64,000 beyond the end of June 2018 resulting in the net reduction in H1 revenue of £37,000.

Nevertheless, with a reduction in operating costs for the period, assisted by favourable exchange rates, we have still been able to report a profit for the half year. This reflects well upon the overall resilience of the Company. As we look to build future sales, supported by healthy cash reserves and a strong balance sheet, I am pleased to announce the payment of an increased interim dividend of 0.06 pence per share.”

Download a PDF of the 2018 Interim Results, including the Group Income Statement.


 

CHAIRMAN’S STATEMENT

Our total sales revenues for the period decreased significantly, principally due to the expiry of a three year customer contract for Migrate. Changes to IFRS accounting rules in 2018 also had the effect of deferring £27,000 of software revenue recognition beyond the end of December 2017 and £64,000 beyond the end of June 2018 resulting in the net reduction in H1 revenue of £37,000.

Nevertheless, with an annual reduction in operating costs, assisted by favourable exchange rates, we have still been able to report a small profit for the half year. This reflects well upon the overall resilience of the Company.

As we look to build future sales, supported by healthy cash reserves and a strong balance sheet, I am pleased to announce the payment of an increased interim dividend of 0.06 pence per share.

David Ashman
Chairman 

 

BUSINESS OVERVIEW 

Stilo develops software tools and cloud services that help organisations create and process structured content in XML format, so that it can be more easily stored, managed, re-used, translated and published to multiple print and digital channels.

Over recent years, many organisations have adopted industry specific XML standards e.g. Publishing (DocBook), Aerospace & Defence (S1000D), Finance (XBRL), Life Sciences (SPL), Software and High Tech (DITA).  Stilo made the decision some years ago to focus new product development and marketing efforts on the emerging DITA standard.  This standard originated within IBM to support the publishing of its technical documentation and has been increasingly adopted by other software and high tech companies. DITA is now beginning to make inroads into additional market sectors including Manufacturing, Life Sciences and Publishing.

In order to diversify beyond the DITA market, we have recently undertaken research into the XML JATS (Journal Article Tag Suite) market for scientific and scholarly publishers. Initial indications are that this could represent a promising new business opportunity for Stilo, and we will seek to address this through the incremental development of AuthorBridge and Migrate.

We continue to build upon our strong reputation for excellent products and supporting technical expertise, resulting from many years of experience in the structured content marketplace. With offices in the UK and Canada, we support clients throughout North America, Europe and Japan. 

PRODUCTS AND CUSTOMERS 

OmniMark

Stilo’s core technology is OmniMark, a long-established development platform used to build high-performance content processing applications integral to enterprise publishing solutions.

Users include The Boeing Company, Pratt and Whitney, Airbus Defence & Space, Clarivate Analytics, and Wolters Kluwer. Sales for the period included orders from the European Parliament, Toshiba Digital Solutions Corporation (Japan Patent Office), Qantas and Gulfstream. 

Migrate

Migrate is the world’s first cloud XML content conversion service, and utilises OmniMark technology. Through advanced levels of automation, it enables organisations to improve turnaround times, reduce operating costs and take direct control of their work schedules, providing an attractive alternative to traditional outsourced conversion services.

Migrate users include IBM, Cisco, EMC and Oracle. Sales for the period include orders from Viewpoint, Arris, Synopsis, Deltek, Varian and Tibco. Using Migrate, we have helped our customers convert over one million pages of content to the DITA format.

Complementing Migrate, we announced in July the introduction of a new professional service utilising OptimizeR. OptimizeR is a tool that we are developing to help automate the de-duplication of DITA content and help maximise the opportunity for content re-use. It will initially be used by Stilo professional services personnel and will be productised in due course as we gain experience of various customer use cases.

OptimizeR addresses key issues for customers who are converting their legacy content to DITA, in addition to experienced DITA users, and represents a promising new business opportunity. We are encouraged by initial feedback received from prospective customers and business partners. 

AuthorBridge

AuthorBridge is a web-based XML authoring tool, designed for occasional content contributors who have no knowledge of XML or its complexities. It is currently targeted at large enterprises, which are looking to extend the use of DITA across different business units and potentially support thousands of users.

Development of AuthorBridge continues to progress well in 2018, albeit with significant slippage against original schedules. Its initial adoption by the central Information Developer Tools team at IBM in the USA and the Nuclear Regulatory Commission in Washington D.C. provides a good foundation upon which we can build future sales.

Early in 2018 AuthorBridge was selected by Kaplan Professional Education as their web authoring tool of choice and has since been successfully integrated with their Componize for Alfresco content management system, The partnership with Componize is encouraging and is already helping to generate additional business opportunities for AuthorBridge in the DITA market.

OPERATIONS

Stilo operates from offices located in Swindon, UK and Ottawa, Canada.  The technical team is based in our Ottawa office.

As of 30 June 2018, there were 17 permanent employees in the Company, complemented by the use of contractors. We will not be growing headcount significantly in 2018, as we look to contain our costs in line with the latest sales projections.

FINANCIAL RESULTS

The results for the six months ended 30 June 2018 have been prepared in accordance with the recognition and measurement principles of International Financial Reporting Standards as adopted by the European Union.

In 2018 the interim results for Stilo show post-tax profits of £42,000. (2017:  £142,000)

Total sales revenues for the period decreased to £707,000 (2017: £910,000), principally due to the expiry of a 3 year customer contract for Migrate. A reduction in maintenance revenues and the net impact of transition to the new accounting standard IFRS 15 were otherwise offset by increases in sales of Migrate, OmniMark licences and initial embryonic revenues for AuthorBridge.

The Company maintains careful control over all operating costs. Favourable exchange rates helped as we reduced our operating costs during the period, excluding capitalised development costs, to £657,000 (2017: £759,000).

Investment in R & D continued in 2018, with total expenditure for the period of £271,000 (2017: £290,000). As a result of this investment, Stilo continues to benefit from research and development tax credits. Of this expenditure, £99,000 relating to the development of AuthorBridge has been capitalised (2017: £91,000), and the total accumulated capitalised costs will be depreciated over a 10 year period, likely commencing in 2019.

There was a reduced cash balance of £1,442,000 as at 30 June 2018 (30 June 2017: £1,602,000) and Stilo remains entirely un-geared. This balance sheet stability provides a sound financial base for the Company and will support continued investment in product development, sales and marketing.

DIVIDENDS

During the period, the final dividend for the year ended 31 December 2017 was paid, of 0.05 pence per share (2016: 0.05 pence), providing an increased total dividend of 0.10 pence for the year.

The Board is pleased to declare the payment of an Interim dividend for the year ending 31 December 2018 to shareholders of 0.06 pence per share (2017: 0.05 pence per share) which will be paid on 20 November 2018 to those shareholders on the register as at 19 October 2018. The shares will be marked ex-dividend on 18 October 2018.

The Board’s policy is to maintain payment of a steady and progressive dividend, well covered and paid subject to maintaining sufficient funds within the business with regard to prudent forecasts of future capital requirements, without the need for debt funding. 

OUTLOOK

The global market for dynamically publishing structured content to multiple channels continues to grow, which in turn drives the market for XML content conversion and authoring tools.

In the Company’s AGM Statement of 23 May 2018 and Trading Update of 26 July 2018 we indicated that results for the year ending 31 December 2018 would likely be impacted because of the non-repeatability of two significant contracts that were received in 2017. Unfortunately, during the first six months of 2018 the Company has not made the sales breakthroughs required to compensate for the orders shortfall.

This position is likely to continue for the second half of 2018, as the Company looks to build the sales pipeline whilst controlling costs in line with sales projections.

ENQUIRIES

Stilo International plc
Les Burnham, Chief Executive
T +44 1793 441 444

SPARK Advisory Partners Limited (Nominated Adviser)
Neil Baldwin T +44 203 368 3554
Mark Brady  T +44 203 368 3551

SI Capital (Broker)
Nick Emerson
T +44 1483 413500


Trading Update

26 July 2018                            

Stilo International plc (“Stilo” or the “Company”) today provides a trading update following its half year end on 30 June 2018. The Company develops software tools and cloud services that help organisations create and process structured content in XML format so that it can be more easily stored, managed, re-used, translated and published to multiple print and digital channels. 

In the Company’s AGM statement of 23 May 2018 we indicated that results for year ended 31 December 2018 would likely be impacted because of the non-repeatability of two significant contracts that were received in 2017. Unfortunately, during the first six months of 2018 the Company has not made the sales breakthroughs required to compensate for the orders shortfall and the Board can now confirm that the Company expects to report a near break-even position for the six month period ended 30 June. 

Current indications are that this position is likely to continue for the second half of 2018, as the Company looks to build the sales pipeline. In the meantime, given our strong balance sheet, the Board intends to continue to make significant investments in R&D and expects to announce the payment of an interim dividend when the interim results are published in late August.

ENQUIRIES

Stilo International plc
Les Burnham, Chief Executive T +44 1793 441 444

SPARK Advisory Partners Limited (Nominated Adviser)
Neil Baldwin T +44 203 368 3554
Mark Brady  T +44 203 368 3551

SI Capital (Broker)
Nick Emerson T +44 1483 413500


Director / PDMR Shareholding

Stilo International plc (“Stilo” or the “Company”) has been notified that David Ashman, the Company’s Chairman and Non-Executive Director, purchased 475,000 ordinary shares of 1p each in Stilo (“Ordinary Shares”) at 3.7p per Ordinary Share on 29 May 2018.

Following this purchase, David Ashman, and persons associated with David Ashman, have a beneficial interest in 24,083,910 Ordinary Shares, representing approximately 21.14 percent of the issued share capital of the Company.

 

1. Details of the PDMR / person closely associated
a) Name David Ashman
2. Reason for the notification
a) Position / status PDMR
b) Initial notification / amendment Initial notification
3. Details of the issuer, emission allowance market participant, auction platform, auctioneer or auction monitor
a) Name Stilo International  plc
b) LEI 213800QIK312ADX4DN82
4. Details of the transaction(s): section to be repeated for (i) each type of instrument; (ii) each type of transaction; (iii) each date; and (iv) each place where transactions have been conducted
a)

Description of the financial instrument, type of instrument

Identification code

Purchase of ordinary shares of £0.01 each in Stilo International plc

GB0009597484

b) Nature of the transaction Purchase of Shares
c) Price(s) and volume(s) 475,000 at 3.7p
d) Aggregated information N/A (Single transaction)
–  Aggregated volume
–      Price
e) Date of the transaction 29 May 2018
f) Place of the transaction London Stock Exchange (XLON)

ENQUIRIES

Stilo International plc
Les Burnham, Chief Executive T +44 1793 441 444

SPARK Advisory Partners Limited (Nominated Adviser)
Neil Baldwin T +44 203 368 3554
Mark Brady  T +44 203 368 3551

SI Capital (Broker)
Nick Emerson T +44 1483 413500


Result of AGM 23 May 2018

23 May 2018

Stilo International plc (AIM:STL), the AIM quoted software and cloud services company, announces that all resolutions proposed at its AGM held earlier today were duly passed without amendment.

ENQUIRIES

Stilo International plc
Les Burnham, Chief Executive T +44 1793 441 444

SPARK Advisory Partners Limited (Nominated Adviser)
Neil Baldwin T +44 203 368 3554
Mark Brady  T +44 203 368 3551

SI Capital (Broker)
Nick Emerson T +44 1483 413500