Management at Ubisense, the AIM-listed Cambridge-based ‘real-time location intelligence’ products company, has neatly solved the problem of highlighting the divergent performance of its ‘business of two halves’ – by merging the P&L’s of the two main operating units. Fair enough if the business was motoring well – few software companies expose their P&L at the product level – but not helpful when the company is sinking into deeper loss.
Such is the case at Ubisense, which recorded first half net losses of £1.54m, over twice as deep as for the whole of 2012. Revenues for the six months to 30th June 2013 rose by 4% (all organic) to £12.4m, of which just over half derives from services. However, gross profit clunked by 14% to £3.6m, leading to a £1.46m operating loss. A small part of this (£114k) was due to a failed acquisition attempt.
Despite all this, Ubisense CEO, Richard Green, reported record orders and “looks forward to the rest of the year with confidence”. Ubisense listed its shares on AIM at 180p in June 2011 and was the first UK software and IT services IPO after a year’s drought. Its shares have never fallen below the listing price and closed yesterday at 227p, a 26% premium. I think the company is in the right ‘space’ – but management just doesn’t seem to be able to get operational basics right.