After resetting market expectations a couple of times during last year, Richard Green, CEO of AIM-listed, Cambridge-based, ‘real-time locations solutions’ company Ubisense predicted ‘continued growth’ and ‘improved financial performance’ in 2013.
As it was, revenues for 2012 came in short per the warning in January (see Ubisenses FY revenue shortfall), with 2% headline growth to £24.3m, but a 7% organic decline. It all went horribly wrong on the bottom line, where marginal profitability in 2011 (£34k) turned into a £638k loss.
Ubisense is in every sense a business of two halves, with the two divisions sporting quite different operating and financial models. The RTLS division (39% of group revenues, growing 10%) saw (adjusted) operating margins more than double to 7.6%. However, profits at the Geospatial division slumped by 20% on 3% revenue decline, knocking over 3 points off the margin (15.9%).
Perhaps the reason for Ubisense’s difficulties is the lack of clarity as to who really is running the show. There is a wonderful paragraph in the Segment Reporting section of today’s results which reads thus (my highlighting): “This is based upon the Group's internal organisation and management structure and is the primary way in which the Chief Operating Decision Maker (CODM) and the rest of the Board are provided financial information. The Directors believe that the CODM is the Chief Executive Officer of the Group.” Can anyone enlighten them?