4 September 2012

Highlights
Ubisense Group plc
Interim results for the six months ended 30 June 2012
Ubisense Group plc (“Ubisense” or the “Company”) (LSE: UBI), a market leader in location based
smart technology, has announced its interim results for the six months ended 30 June 2012.
Financialhighlights

Operational
highlights



Revenue increased 6.2% to £12.0m (H1 2011: £11.3m) and 12.8%
excluding one-off 2011 pass through revenues of £0.7m

RTLS revenues grew 18.7% after pass through (9.5% reported)Geospatial revenues grew 9.8% after pass through (4.3% reported)Improved gross margin of 34.7% (H1 2011: 31.7%)

Adjusted EBITDA* loss of £0.2m (H1 2011: £0.4m profit) reflecting
investment in product development and marketing

Reported operating loss of £0.8m (H1 2011: £0.1m loss)

Adjusted diluted loss per share** 3.1p (H1 2011: 0.4p profit)

Net cash of £3.3m



4 new key contract wins including a major strategic win at AGCO

6 key follow on orders, including from Airbus and BMWExpansion of Atlas Copco pilot programme with major manufacturers



Increased investment in applications development in both divisions

Double Queen’s Award winner for Innovation and International
Trade

Richard Green, Chief Executive, commented,“The Group has had a good first six months of 2012. The number of opportunities in high value
manufacturing for the RTLS business continues to increase and we are seeing a significant
acceleration in activity through our relationship with Atlas Copco. Given our robust pipeline and themomentum we see, we remain confident in the long term prospects for the business.”* Measured as operating profit excluding depreciation, amortisation, share-based payments charge and nonrecurring costs such as AIM listing expenses and acquisition costs.
** Earnings measured as profit for the period excluding amortisation on acquired intangible assets, sharebased payments charge and non-recurring costs such as AIM listing expenses and acquisition costs.

Contact
Ubisense Group plc
Richard Green
Gordon Campbell

Tel: + 44 (0) 1223 535170

Canaccord Genuity Limited(NOMAD)
Simon Bridges
Kit Stephenson

Tel: +44 (0) 20 7523 8000

FTI Consulting
James Melville-Ross
Jon SnowballTel: +44 (0) 20 7831 3113

Page 1 of 21

Highlights

About Ubisense
Ubisense is a market leader in location based smart technology which enables companies tooptimise their business processes. By keeping track of key assets, Ubisense solutions bring clarity
to complex operations in industries while also improving quality and reliability.
Ubisense uses a unique combination of advanced industry knowledge and an experienced team todeliver effective and superior solutions that offer unprecedented visibility, control and accuracy,
delivering time and cost savings. Ubisense solutions are easy to implement and flexible to aparticular business’ needs, no matter which area of the globe they operate in.
Ubisense offers two location-oriented products, RTLS (Real-Time Location Systems) and Geospatial
Solutions, which operate in a number of industries ranging from manufacturing and utilities totelecommunications and is used by a number of blue chip customers across the world, including
Airbus, Aston Martin, BMW, Cummins, Deutsche Telekom and Duke Energy.
Ubisense is headquartered in Cambridge, UK, with offices in the USA, Canada, France, Germany,
Korea and Singapore. For more information visit: www.ubisense.net.

Page 2 of 22

Interim management report

Overview
In a challenging macroeconomic environment, Ubisense increased revenues by 6.2% to £12.0 million
in the first half of 2012 (H1 2011: £11.3 million). The revenue growth is 12.8% after excluding oneoff nil margin revenues totalling £0.7 million where third party products and services were provided
to customers on a pass-through basis in the first half of 2011. Weakness in the Euro had a negative
impact on the consolidated result, lowering the year on year growth by around 3.4%.
As reported in July, the Company experienced short-term delays with a small number of orders in the
North American market during the latter stages of H1. In some cases, the delays were a result of
longer negotiation processes due to a widening in the scope of contracts. It is pleasing to report thatsince the period end the majority of these orders have been received.
During the period, Ubisense has continued to invest significantly in its long-term strategy throughproduct innovation, marketing, recruitment and strategic partner programmes. Total headcount at
30 June 2012 was 186 (June 2011: 132; December 2011: 172).
As a result of these continued investments, our Adjusted EBITDA for the period was a loss of £0.2
million compared to a profit of £0.4 million for the same period in 2011. The Board views RTLS
revenue growth and Adjusted EBITDA as the most appropriate measures of underlying trading
performance.
Strategy
The opportunities for Ubisense continue to be significant and the Group continues to grow in an agile
and prudent way. The Board’s focus is on growing the business by extending our presence inpriority G7 markets, particularly in the key Asian markets of Korea and Japan, and to capture newcustomers through new strategic partnerships, similar to our partnership with Atlas Copco. Our aim
is to create long lasting customer relationships with major global businesses in high value markets.
The Board continues to evaluate suitable acquisition opportunities in this area to enhance its
product offering and customer base.
The RTLS division continues to expand its presence in the manufacturing industry, through the EADSGroup, the automotive OEMs and other large international groups such as AGCO. Ubisense’s RTLS
solutions also have the potential to be used extensively in a number of different industries, forexample through a strategic partnership with S3-ID selling to Agip in the Oil & Gas sector.
The Geospatial division has the opportunity to establish a leadership position in the Geospatialindustry through accretive investment in new geographic territories and complementary intellectual
property.

Page 3 of 22

Interim management report

Operating and financial review
RTLS
RTLS’s revenues increased by 9.5% to £4.3 million (H1: 2011: £3.9 million). Excluding pass-throughrevenues in the first half of 2011 of £0.3 million, the growth was 18.7%. The high gross margins on
RTLS revenue remained steady at 49.5% (H1 2011: 49.8%).
Adjusted EBITDA was marginally up at £65,000 (H1 2011: £45,000). The RTLS division continued toinvest in the Atlas Copco relationship who importantly accelerated the support of their pilot
programme, which is now running across many organisations including five of the largest car
manufacturers in the world. Since the period end, and as announced separately today, thismomentum has continued with significant first orders from two major automotive OEMs. Headcountincreases in our sales and delivery teams, as well as our R&D team to expand our range of RTLS
applications, resulted in headcount reaching 71 at the end of June 2012 (H1 2011: 63).
Geospatial
Geospatial revenues increased by 4.3% to £7.7 million (H1 2011: £7.4 million). Excluding passthrough revenues in the first half of 2011 of £0.4 million, growth was 9.8% driven by the InMaps andRealworld acquisitions made in the second half of 2011. Gross margins improved to 26.6% (H1 2011:22.2%) as a result of some higher margin product sales and a reduction in the number of contractors
being used in the business.
Adjusted EBITDA was stable at £1.3 million (H1 2011: £1.3 million) with the increased gross profit
being offset by increased R&D and pre-sales expense, as well as costs associated with the integrationof the two acquisitions made in the last quarter of 2011. Total Geospatial headcount was 95 (H1
2011: 57), 28 of the increase since last year relates to the acquisitions. We are pleased that bothacquisitions, Realworld (now Geospatial Systems Limited) and InMaps (now merged into UbisenseInc), are performing in line with expectations.
CentralCentral corporate costs were £1.6 million (H1 2011: £1.0 million) resulting in an overall EBITDA lossof £0.2 million. Included in that increase was a net foreign exchange loss of £0.1 million (H1 2011:£0.1 million gain). The underlying increase in central corporate costs was due to an increase inheadcount (20 compared to 12 at the same time last year), marketing and costs relating to being a
listed company.
Group operating profit and profit after tax
The operating loss for the period was £0.8 million (H1 2011: £0.1 million) including amortisationand depreciation charges of £0.6 million (H1 2011: £0.2 million) as a result of amortisation on theintangible assets acquired with Realworld and InMaps in the second half of 2011 and increased
amortisation charges on capitalised development costs as investment in R&D increases.
Net interest receivable for the period was £14,000 (H1 2011: £172,000 expense) with interest
expense being virtually eliminated following the conversion of the Convertible Loans and repaymentof the bank loan at the time of the IPO in June 2011. Surplus cash is invested with the primary aim ofcapital maintenance; the Company’s treasury policy includes strict counterparty limits and only withcounterparties with high credit ratings.
Reported loss before tax was £0.8 million (H1 2011: £0.3 million loss).

Page 4 of 22

Interim management report

Operating and financial review (continued)
The Group has a net tax expense of £46,000, almost entirely a result of deferred tax on capitalised
development costs and acquired intangible assets. In the period ended June 2011, we had a net tax
credit of £66,000 which included a current tax credit of £95,000 in respect of R&D tax credits. We
account for R&D tax credits on prudent cash received basis and expect to receive a similar credit in
the second half of this year. Excluding the R&D tax credits receipt, management’s best estimate of theeffective current tax rate is nil due to the availability of prior years losses.
EPS and dividend
Adjusted diluted loss per share was 3.1 pence (H1 2011: 0.4 pence profit). Reported basic anddiluted loss per share was 4.0 pence (H1 2011: 1.6 pence loss).
The Board do not feel it appropriate at this time to pay an interim dividend. The cash balance held on
the balance sheet will be used to fund growth, R&D and potential acquisitions in line with thestrategy set out when listing on AIM in June 2011.
Balance sheet and cash
The Group has a robust balance sheet with Shareholder Funds at 30 June 2012 of £18.4 million (31December 2011: £19.2 million), including net cash of £3.3 million (31 December 2011: £6.0 million)
and no debt.
The main components to the cash movements in the first six months of 2012 include operating cash
outflow of £1.5 million (H1 2011: £2.9 million outflow), capital investment in product development
and plant and equipment of £1.0 million (H1 2011: £0.5 million) and contingent consideration paidof £0.2 million in respect of the Realworld acquisition made in October 2011.
Capital structure
The issued share capital at 30 June 2012 was 21,801,967 (December 2011: 21,657,698) ordinary
shares of £0.02 each. The increase of 144,269 shares relates entirely to share option exercises by
employees. In addition, 347,000 share options were granted to employees on 29 June 2012 at an
exercise price of £2.125, being the share price at the time. The total number of unexercised shareoptions at 30 June 2012 was 2,093,720.
Current trading and outlook
Ubisense enters the second half of 2012 with increasing momentum in the business. With a strong
order book and robust pipeline, improved financial performance is anticipated in the second half of2012. We continue to expect revenue growth year-on-year and profits similar to 2011.

Page 5 of 22

Interim income statement
For the six months ended 30 June 2012

Notes

Six months to
30 June2012
unaudited£’000

Six months to
30 June2011
unaudited£’000

12 months to
31 December
2011
audited£’000

611,950

11,25523,785

Cost of sales(7,799)(7,684)(15,308)

Gross profit

4,151

3,571

8,477

Administrative expenses(4,995)(3,719)(8,188)

(844)

(148)

289

Gross profit

4,151

3,571

8,477

Other administrative expenses(4,377)(3,156)(7,029)Adjusted EBITDA

(226)

415

1,448

Depreciation

(100)

(60)

(140)

Amortisation of acquired intangible assets

(128)

-

(112)

Amortisation of other intangible assets

(369)

(171)

(512)

Share-based payments charge

(21)

(8)

(24)

AIM listing expenses

-

(324)

(324)

Acquisition costs

-

-

(47)

Revenue

Operating (loss)/profit

6

Analysed as:

Operating (loss)/profit

6

(844)

(148)

289

Finance income

7

15

8

37

Finance costs

7

(1)

(180)

(185)

(830)

(320)

141

(46)

66

(107)

(876)

(254)

34

(Loss)/profit before tax
Income tax

8(Loss)/profit for the period attributable to theequity shareholders of the Company

Earnings per share (pence)
Basic

9

(4.0p)(1.6p)

0.2p

Diluted9(4.0p)(1.6p)

0.2p

The notes 1 to 17 are an integral part of these condensed interim financial statements.

Page 6 of 22

Interim statement of comprehensive income
For the six months ended 30 June 2012

Six months to
30 June2012
unaudited£’000

Six months to
30 June2011
unaudited£’000

12 months to
31 December
2011
audited
£’000

(876)

(254)

34

Exchange difference on retranslation of net assets and resultsof overseas subsidiaries

(30)

66

14

Total comprehensive income attributable to equity
shareholders of the Company

(906)

(188)

48

(Loss)/profit for the period
Other comprehensive income:The notes 1 to 17 are an integral part of these condensed interim financial statements.

Page 7 of 22

Interim statement of changes in equity
For the six months ended 30 June 2012

Share
capital
£’000

Share
premium
£’000

Other
reserves£’000

Retainedearnings
£’000

Total
£’000

433

22,031510(3,736)

19,238Loss for the period

-

-

-

(876)

(876)

Exchange difference on retranslation of net
assets and results of overseas subsidiaries

-

-

(30)

-

(30)

Total comprehensive income for the period

-

-

(30)

(876)

(906)

Reserve credit for equity-settled share-based
payment

-

-

21

-

21

Issue of new share capital

3

-

-

-

3

Premium on new share capital

-

25

-

-

25

Transactions with owners

3

25

21

-

49

436

22,056501(4,612)

18,381

Sharecapital
£’000

Share
premium
£’000

Other
reserves£’000

Retainedearnings
£’000

Total
£’000

3042

14,550953(4,272)

11,535

Loss for the period

-

-

-

(254)

(254)

Exchange difference on retranslation of net
assets and results of overseas subsidiaries

-

-

66

-

66

Total comprehensive income for the period

-

-

66

(254)

(188)

Reserve credit for equity-settled share-based
payment

-

-

134

-

134

Equity component of loans

-

-

(502)

502

-

Issue of new share capital

129

-

-

-

129

Premium on new share capital

-

7,968

-

-

7,968

Share issue costs

-

(591)

-

-

(591)

Transactions with owners

129

7,377

(368)

502

7,640

Balance at 30 June 2011 (unaudited)

433

21,927651(4,024)

18,987

Balance at 1 January 2012 (audited)

Balance at 30 June 2012 (unaudited)

Balance at 1 January 2011 (audited)

A reconciliation of the components of Other reserves is given in note 15.
The notes 1 to 17 are an integral part of these condensed interim financial statements.

Page 8 of 22

Interim statement of financial position
At 30 June 2012

At
30 June2012
unaudited£’000

At
30 June2011
unaudited£’000

At
31 December
2011
audited
£’000

7,418

6,069

7,418

2,550

752

2,258

476

299

366

10,444

7,120

10,042

1,115

784

1,667

8,508

7,774

9,498

Cash and cash equivalents

3,324

8,077

6,034

Total current assets

12,947

16,635

17,199Total assets

23,391

23,75527,241(4,254)(4,587)(7,294)(4,254)(4,587)(7,294)

(596)

(181)

(549)

(160)

-

(160)

(756)

(181)

(709)

Total liabilities(5,010)(4,768)(8,003)

Net assets

18,381

18,987

19,238

436

433

433

22,05621,92722,031

501

651

510

Retained earnings(4,612)(4,024)(3,736)

Total equity

18,381

18,987

19,238

Notes

AssetsNon-current assets
Goodwill
Other intangible assets

10

Property, plant and equipment

1

Total non-current assets
Current assets
Inventories
Trade and other receivables

11

Liabilities
Current liabilities
Trade and other payables

12, 13

Total current liabilities
Non-current liabilities
Deferred tax liability
Other liabilities

13 4

Total non-current liabilities

EquityEquity attributable to owners of the parent company
Share capital

14

Share premium account
Other reserves

15

The notes 1 to 17 are an integral part of these condensed interim financial statements.

Page 9 of 22

Interim statement of cash flows
For the six months ended 30 June 2012

Six months to
30 June2012
unaudited£’000

Six months to
30 June2011
unaudited£’000

12 months to
31 December
2011
audited
£’000

(830)

(320)

141

Depreciation

100

60

140

Amortisation

497

171

624

Share-based payments charge

21

8

24

Notes

(Loss)/profit before tax
Adjustments for:Finance income

7

(15)

(8)

(37)

Finance costs

7

1

180

185

60

19

12

Operating cash flows before working capital
movements
Change in inventories

(166)

110

1,089

552

(420)

(1,303)

Change in receivables

1,004

(880)

(2,065)

Change in payables(2,858)(1,844)(108)

Cash generated by operations before tax(1,468)(3,034)(2,387)

1

107

102

(1,467)(2,927)(2,285)(200)-(1,600)Purchases of property, plant and equipment

(210)

(146)

(256)

Purchases of intangible assets

(789)

(340)

(1,130)15

8

33(1,184)(478)(2,953)

Repayment of borrowings

-

(892)

(1,014)

Interest paid

(1)

(42)

(47)

28

5,238

5,238

27

4,304

4,177

Net increase in cash and cash equivalents(2,624)899(1,061)

Cash and cash equivalents at start of period

6,034

7,130

7,130

(86)

48

(35)

3,324

8,077

6,034

Foreign exchange differences

Net income taxes received
Net cash flows from operating activities
Cash flows from investing activities
Acquisition of subsidiaries, net of cash acquired

13

Interest received
Net cash flows from investing activities
Cash flows from financing activities

Proceeds from the issue of share capital

14

Net cash flows from financing activities

Exchange differences on cash and cash equivalents
Cash and cash equivalents at end of period7

The notes 1 to 17 are an integral part of these condensed interim financial statements.

Page 10 of 22

Notes to the interim financial statements
1 General information
Ubisense Group plc (‘the Company’) and its subsidiaries (together, ‘the Group’) deliver missioncritical enterprise asset tracking and geospatial systems.
The Group has operations in the UK, USA, Canada, France, Germany, Korea and Singapore and sells
mainly in the USA and Europe.
The Company is a public limited company which is listed on the Alternative Investment Market(‘AIM’) of the London Stock Exchange (UBI) and is incorporated and domiciled in the UK. The
address of its registered office is St. Andrew’s House, St. Andrew’s Road, Chesterton, Cambridge, CB4
1DL.
The condensed consolidated interim financial statements were approved by the Board of Directors
for issue on 3 September 2012.
The condensed consolidated interim financial statements do not comprise statutory accounts within
the meaning of section 434 of the Companies Act 2006. Statutory accounts for the year ended 31
December 2011 were approved by the Board of Directors on 19 March 2012 and delivered to theRegistrar of Companies. The report of the auditors on those accounts was unqualified, did notcontain an emphasis of matter paragraph and did not contain any statement under section 498 of theCompanies Act 2006.
The condensed consolidated interim financial statements have been reviewed, not audited.

2 Basis of preparation
The condensed consolidated interim financial statements should be read in conjunction with theannual financial statements of the Group and are prepared in accordance with IFRSs as adopted by
the European Union.
Going concern basis
The Group’s forecasts and projections, taking account of reasonably possible changes in trading
performance, support the conclusion that there is a reasonable expectation that the Company and
the Group have adequate resources to continue in operational existence for the foreseeable future, aperiod of not less than twelve months from the date of this report. The Group therefore continues toadopt the going concern basis in preparing its condensed consolidated interim financial statements.

Page 11 of 22

Notes to the interim financial statements
3 Accounting policies
The accounting policies adopted in the preparation of the condensed consolidated interim financial
statements are unchanged from those set out in the Group’s consolidated financial statements for theyear ended 31 December 2011. These policies have been consistently applied to all the periods
presented.
The operations of the Group are not subject to significant seasonality.

4 Estimates
The preparation of interim financial statements requires management to make judgements,
estimates and assumptions that affect the application of accounting policies and the reported
amounts of assets and liabilities, income and expense. Actual results may differ from these estimates.
In preparing these condensed consolidated interim financial statements, the significant judgements
made by management in applying the Group’s accounting policies and the key sources of estimation
and uncertainty were the same as those that applied to the consolidated financial statements for theyear ended 31 December 2011.

5 Risks and uncertainties
An outline of the key risks and uncertainties faced by the Group was described in the 2011 financial
statements, including exposure to foreign exchange rate fluctuation, in particular the strength of
Sterling relative to the US dollar and Euro. Risk is an inherent part of doing business and the strong
cash position and order book leads the Directors to believe that the Group is well placed to manage
business risks successfully.

Page 12 of 22

Notes to the interim financial statements
6 Operating segments
Management has determined the operating segments to be the Group’s two divisions based on thereports reviewed by the Chief Operating Decision Maker. The Chief Operating Decision Maker is theChief Executive Officer.
The Real-Time Location Systems division (“RTLS”) delivers mission-critical enterprise asset tracking
solutions utilising ultra-wideband (“UWB”) technology to locate people and assets in 3D, bringing
visibility and control to industrial business processes. The Geospatial division delivers core location
based solutions, typically to blue chip utility and communications companies, to allow them to better
plan and maintain their dispersed network of assets. Centrally incurred costs not directly
attributable to business segments are reported under ‘Central’.
Each of these operating segments is managed separately as each deal with different technologies andpredominantly different customer bases. The performance of the operating segments is assessed ona measurement of Adjusted EBITDA. The measurement basis excludes depreciation, amortisation,
share-based payments charge, non-recurring expenditure such as AIM listing expenses andacquisition costs, finance income and expense and income taxes.

Six months ended 30 June 2012

RTLS
£’000

Geospatial£’000

Central
£’000

Total
£’000

Revenue

4,259

7,691

-

11,950

Cost of sales(2,152)(5,647)-(7,799)Gross profit

2,107

2,044

-

4,151

Other administrative expenses(2,042)(752)(1,583)(4,377)65

1,292(1,583)(226)

Depreciation

-

-

(100)

(100)

Amortisation of acquired intangible assets

-

(128)

-

(128)

(248)

(77)

(44)

(369)

-

-

(21)

(21)

(183)

1,087

(1,748)(844)

Finance income

-

-

15

15

Finance costs

-

-

(1)

(1)

(183)

1,087

(1,734)(830)

Adjusted EBITDA

Amortisation of other intangible assets
Share-based payments charge
Operating (loss)/profit(Loss)/profit before tax

Page 13 of 22

Notes to the interim financial statements
6 Operating segments (continued)

Six months ended 30 June 2011

RTLS
£’000

Geospatial£’000

Central
£’000

Total
£’000

Revenue

3,888

7,367

-

11,255

Cost of sales(1,951)(5,733)-(7,684)Gross profit

1,937

1,634

-

3,571

Other administrative expenses(1,892)

(292)

(972)

(3,156)

45

1,342

(972)

415

-

-

(60)

(60)

(164)

-

(7)

(171)

Share-based payments charge

-

-

(8)

(8)

AIM listing expenses

-

-

(324)

(324)

(119)

1,342

(1,371)(148)

Finance income

-

-

8

8

Finance costs

-

-

(180)

(180)

(Loss)/profit before tax

(119)

1,342

(1,543)(320)

12 months ended 31 December 2011

RTLS
£’000

Geospatial£’000

Central
£’000

Total
£’000

Revenue

8,650

15,135-23,785

Cost of sales(4,012)(11,296)-(15,308)

Gross profit

4,638

3,839

-

8,477

Other administrative expenses(3,936)(738)(2,355)(7,029)

702

3,101

(2,355)

1,448

Depreciation

-

-

(140)

(140)

Amortisation of acquired intangible assets

-

(112)

-

(112)

(437)

(57)

(18)

(512)

Share-based payments charge

-

-

(24)

(24)

AIM listing expenses

-

-

(324)

(324)

Acquisition costs

-

-

(47)

(47)

265

2,932

(2,908)289

Finance income

-

-

37

37

Finance costs

-

-

(185)

(185)

265

2,932

(3,056)

141

Adjusted EBITDA
Depreciation
Amortisation of other intangible assets

Operating (loss)/profit

Adjusted EBITDA

Amortisation of other intangible assets

Operating profit/(loss)

Profit/(loss) before tax

Page 14 of 22

Notes to the interim financial statements
7 Finance income and costs
Six months to
30 June2012
unaudited£’000

Six months to
30 June2011
unaudited£’000

12 months to
31 December
2011
audited£’000

Interest income from cash and cash equivalents

15

8

37

Finance income

15

8

37

Six months to
30 June2012
unaudited£’000

Six months to
30 June2011
unaudited£’000

12 months to
31 December
2011
audited£’000

Interest payable – bank

(1)

(21)

(26)

Interest payable – other loans

-

(159)

(159)

Finance costs

(1)

(180)

(185)

Finance costs for the six months ended 30 June 2011 and the twelve months ended 31 December
2011 included an imputed non-cash amount of £138,000 relating to interest as a result of conversionof the Convertible Loans into shares and exercise of the warrants attaching to the bank loan.

8 Income tax
At
30 June2012
unaudited£’000

At
30 June2011
unaudited£’000

At
31 December
2011
audited
£’000

1

95

133

Deferred tax expense

(47)

(29)

(240)

Total income tax (expense)/credit

(46)

66

(107)

Current tax credit

Income tax is recognised based on management’s estimate of the weighted average annual income
tax rate expected for the full financial year.
The current income tax credit for the periods ended June and December 2011 principally arises dueto the receipt of R&D tax credit relief in respect of the prior year. The Group’s policy is to recognise
tax credits resulting from R&D claims on a cash received basis. A tax credit has not been recognisedin the period ended 30 June 2012 in respect of the claim for the 2011 financial year.

Page 15 of 22

Notes to the interim financial statements
9 Earnings per share
Six months to
30 June2012
unaudited

Six months to
30 June2011
unaudited

12 months to
31 December
2011
audited(Loss)/profit for the period (£’000)

(876)

(254)

34

Earnings for the purposes of diluted earnings per share (£’000)

(876)

(254)

34

21,725

16,182

18,897

1,527

1,572

1,566

15

45

57

23,267

17,79920,520

Basic earnings per share (pence)(4.0p)(1.6p)

0.2p

Diluted earnings per share (pence)(4.0p)(1.6p)

0.2p

Earnings

Number of shares
Basic weighted average number of shares (‘000)
Effect of dilutive potential ordinary shares:- Share options (‘000)- Warrants (‘000)
Diluted weighted average number of shares (‘000)

Basic earnings per share is calculated by dividing profit for the period attributable to ordinary
shareholders of the Company by the weighted average number of ordinary shares outstanding
during the period. For diluted earnings per share, the weighted average number of shares is adjusted
to allow for the effects of dilutive share options, Convertible Loans and warrants. Options have no
dilutive effect in loss-making years, and hence the diluted loss per share for the periods ended June2012 and 2011 is the same as the basic loss per share.
The Group also presents an adjusted diluted earnings per share figure which excludes amortisationon acquired intangible assets, share-based payments charge, and non-recurring expenditure such as
AIM listing expenses and acquisition costs from the measurement of profit for the period.

Adjusted diluted earnings per share

Earnings for the purposes of diluted earnings per share (£’000)

Six months to
30 June2012
unaudited

Six months to
30 June2011
unaudited

12 months to
31 December
2011
audited

(876)

(254)

34

Adjustments

Diluted earnings per share amounts are calculated by dividing the net profit attributable to ordinary
Reversal of amortisation on acquired intangible assets (£’000)
128
equity holders by the weighted average number of ordinary shares
outstanding during
the 112year(adjustedoffor
the effectspaymentsof dilutive
options
and the Group’s convertible21bonds).
Reversal
share-based
charge(£’000)824
Reversal of AIM listing expenses (£’000)

-

324

324

Reversal of acquisition costs (£’000)

-

-

47

Net adjustments (£’000)

149

332

507

Adjusted earnings (£’000)

(727)

78

541

Adjusted diluted earnings per share (pence)(3.1p)

0.4p

2.6p

Page 16 of 22

Notes to the interim financial statements
10 Other intangible assets
At
30 June2012
unaudited£’000

At
30 June2011
unaudited£’000

At
31 December
2011
audited
£’000

1,583

693

1,127

Software

229

59

265

Acquired software products

396

-

485

Acquired customer relationships and backlog

342

-

381

2,550

752

2,258

At
30 June2012
unaudited£’000

At
30 June2011
unaudited£’000

At
31 December
2011
audited
£’000

4,211

4,075

7,541

(34)

(40)

(7)

Trade receivables, net

4,177

4,035

7,534

Amounts recoverable on contracts

3,512

2,943

1,588

Other receivables

26

135

21

Prepayments and accrued income

751

413

314

VAT and taxation receivable

42

248

41

8,508

7,774

9,498

Net book amount

Capitalised development costs

Total other intangible assets

11 Trade and other receivables

Trade receivables, grossAllowances for credit losses

Total trade and other receivables

Page 17 of 22

Notes to the interim financial statements
12 Trade and other payables
At
30 June2012
unaudited£’000

At
30 June2011
unaudited£’000

At
31 December
2011
audited£’000

Payments received on account

1,069

541

1,995

Trade payables

1,032

2,022

2,110

Trade accruals

1,193

1,378

1,633

Other taxation and social security

413

556

817

Other payables

347

90

339

200

-

400

4,254

4,587

7,294

At
30 June2012
unaudited£’000

At
30 June2011
unaudited£’000

At
31 December
2011
audited
£’000

160

-

160

200

-

400

360

-

560

Note

Other liabilities – contingent consideration

13

Total trade and other payables

13 Other liabilities – contingent consideration

Note

Non-current
Current
Total other liabilities – contingent consideration

12

Under the contingent cash consideration arrangement, the Group is required to pay additionalamounts to the vendors of Realworld based on the achievement of two separate performancemilestones that may arise between 2012 and 2013 with a combined undiscounted range of outcomes
between nil and £1,150,000. A liability of £560,000 was recognised upon acquisition on 4 October
2011, based on management’s best estimate of the probability-adjusted expected cash outflow fromthe arrangement.
£200,000 was paid in the period to June 2012 and a further £200,000 has been paid since the period
end, both in respect of the first milestone. The amount recognised for the second milestone isunchanged based on the most recent management estimates.

Page 18 of 22

Notes to the interim financial statements
14 Share capital

Allotted, called-up and fully paidAt
30 June2012
unaudited£’000

At
30 June2011
unaudited£’000

At
31 December
2011
audited£’000

Ordinary shares of £0.02 each

436

433

433

Movement in number of sharesAt
30 June2012
unaudited’000

At
30 June2011
unaudited’000

At
31 December
2011
audited’000

21,657,698

15,211,490

15,211,490-

2,777,778

2,777,778

Issued under share-based payment plans

144,269

374,308376,308

Issued on conversion of Convertible Loan-

3,176,772

3,176,772

Issued on exercise of warrants-

115,350

115,350

144,269

6,444,208

6,446,208

21,801,967

21,655,698

21,657,698

Number of shares at beginning of period
Share issue on Initial Public Offering

Change in number of shares in period
Number of shares at end of period

During the period, the Company issued 144,269 shares increasing the total number of shares in issue
from 21,657,698 to 21,801,967 as a result of options exercised with a weighted average exercise
price of £0.20 per share for total cash consideration of £28,327.

Page 19 of 22

Notes to the interim financial statements
15 Other reserves

Share-based
payment
reserve£’000

Translation
reserve
£’000

Total
£’000

591

(81)

510

-

(30)

(30)

Reserve credit for equity-settled share-based
payment

21-

21

Balance at 30 June 2012 (unaudited)

612

(111)

501

Equitycomponent of
convertibleloans andwarrants£’000

Share-based
payment
reserve£’000

Translation
reserve
£’000

Total
£’000

502

546

(95)

953

Exchange difference on retranslation of net assets
and results of overseas subsidiaries

-

-

66

66

Reserve credit for equity-settled share-based
payment

-

134

-

134

(502)

-

-

(502)

-

680

(29)

651

Balance at 1 January 2012 (audited)
Exchange difference on retranslation of net assets
and results of overseas subsidiaries

Balance at 1 January 2011 (audited)

Equity component of loans
Balance at 30 June 2011 (unaudited)

Page 20 of 22

Notes to the interim financial statements
16 Cautionary statement
This document contains certain forward-looking statements with respect of the financial condition,
results, operations and businesses of Ubisense Group plc. These statements and forecasts involverisk and uncertainty because they relate to events and depend on circumstances that will occur inthe future. There are a number of factors that could cause the actual results or developments to differ
materially from those expressed or implied by these forward looking statements and forecasts.
Nothing in this document should be construed as a profit forecast.

17 Copies of interim financial statements
Copies of the interim financial statements are available from the Company at its registered office at
St. Andrew’s House, St. Andrew’s Road, Chesterton, Cambridge, CB4 1DL. The interim financial
statements will also be available on the Company’s website www.ubisense.net.

Page 21 of 22

Independent review report to Ubisense Group plc
Introduction
We have been engaged by the Company to review the financial information in the half-yearlyfinancial report for the six months ended 30 June 2012 which comprises the Interim Income
Statement, Interim Statement of Comprehensive Income, Interim Statement of Changes in Equity,
Interim Statement of Financial Position, Interim Statement of Cash Flows and related notes (1 to 17).
We have read the other information contained in the half-yearly financial report and considered
whether it contains any apparent misstatements or material inconsistencies with the information in
the condensed set of financial statements.
This report is made solely to the Company in accordance with guidance contained in ISRE (UK and
Ireland) 2410, 'Review of Interim Financial Information performed by the Independent Auditor of
the Entity'. Our review work has been undertaken so that we might state to the Company thosematters we are required to state to them in a review report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume responsibility to anyone other than the
Company, for our review work, for this report, or for the conclusion we have formed.
Directors’ responsibilities
The half-yearly financial report is the responsibility of, and has been approved by, the Directors. The
AIM rules of the London Stock Exchange require that the accounting policies and presentation
applied to the financial information in the half-yearly financial report are consistent with thosewhich will be adopted in the annual accounts having regard to the accounting standards applicablefor such accounts. As disclosed in Note 2, the annual financial statements of the Group are preparedin accordance with IFRSs as adopted by the European Union. The financial information in the halfyearly report has been prepared in accordance with the basis in Note 2.
Our responsibility
Our responsibility is to express to the Company a conclusion on the financial information in the halfyearly financial report based on our review.
Scope of review
We conducted our review in accordance with International Standard on Review Engagements (UKand Ireland) 2410, 'Review of Interim Financial Information Performed by the Independent Auditorof the Entity', issued by the Auditing Practices Board for use in the United Kingdom. A review ofinterim financial information consists of making enquiries, primarily of persons responsible forfinancial and accounting matters, and applying analytical and other review procedures. A review issubstantially less in scope than an audit conducted in accordance with International Standards on
Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would
become aware of all significant matters that might be identified in an audit. Accordingly, we do not
express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the financial
information in the half-yearly financial report for the six months ended 30 June 2012 is not prepared,in all material respects, in accordance with the basis of accounting described in Note 2.
Grant Thornton UK LLP
Chartered Accountants
Registered Auditor
Cambridge
3 September 2012

Page 22 of 22