IndigoVision hikes profits and declares £5m payout

Group Business Editor

Friday 28 September 2012

SCOTTISH video security system specialist IndigoVision is paying a £5.3 million special dividend to investors after enjoying a 123% leap in underlying annual operating profits to £2.66m.

CONTENTED: Hamish Grossart unveiled 123% hike in full-year profits Picture: Gordon Terris

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IAN McCONNELL BUSINESS EDITOR

IndigoVision founder Oliver Vellacott, who exited abruptly late last year and was replaced as chief executive by long-time chief financial officer Marcus Kneen, is in line to receive about £1.2m through the 70p-a-share special dividend for investors in respect of his 22.7% holding.

Mr Vellacott departed as chief executive after having management buy-out proposals, backed by Glasgow-based Scottish Equity Partners, rejected by IndigoVision's board as undervaluing the company. He subsequently mounted, then abandoned, a bid to oust Hamish Grossart as chairman.In his statement on the com-pany's annual results yesterday, Mr Grossart declared that there was "much that needed adjusting to reposition IndigoVision simply to be able to develop at the same rapid pace as its chosen markets".Mr Grossart, who has chaired IndigoVision since 1996, said this was "perhaps clear from the extent of changes to management, operations, and products".Pressed on whether he concurred with this part of the statement from Mr Grossart, Mr Kneen, who worked for years with Mr Vellacott at IndigoVision, replied: "It was just trying to be truthful and clear."Mr Grossart revealed IndigoVision had achieved double-digit percentage growth in sales and order intake in the first seven weeks of its current financial year to July 2013.He added: "At this early stage, there is every reason to believe that the current year will be a good one."IndigoVision's shares leapt 57.5p, or 16.3%, to 410p yesterday, raising its stock market worth by £4.3m to £30.9m..IndigoVision achieved a 5% rise in revenues to £30.3m in the 12 months to July 31 2012. Mr Grossart noted sales growth in the second half had been "a healthy 14%, more than offsetting a 4% decline in the first half".He said: "A tremendous amount has already been achieved under Marcus Kneen's energetic and effective leadership. Although change is not always easy, there is now a visible spring in the step of management worldwide as they see improvements being made which should unlock IndigoVision's potential."IndigoVision revealed to The Herald yesterday that it had been chosen by MetrôRio, the metro system of the Brazilian city of Rio de Janeiro, to supply a complete internet protocol (IP) video security solution to protect the 700,000 people who travel daily on this network.It said it had won the contract to replace MetrôRio's ageing analogue surveillance system because of the "superior image quality" of its cameras, which made for precise identification of individuals in recorded images, and the flexibility of the IP system, which could be scaled up as the metro network grew.Mr Kneen highlighted the importance of his company's launch in May of software to allow clients to incorporate other manufacturers' IP cameras into an IndigoVision video surveillance system. He also noted IndigoVision's launch of a raft of new products, including lower-cost options.IndigoVision enjoyed a 56% leap in its sales in Latin America in the year to July 31, to £6.06m.Mr Kneen highlighted the company's consistently strong growth in Latin America in recent years, and the presence of IndigoVision's video security system technology in about 80 cities in Colombia, including Bogota and Medellin.Sales in North America grew by 5% to £8.11m. However, while the company enjoyed sales growth of 21% in Canada, revenues in the US fell by 5%.Mr Grossart said IndigoVision has "not reached its potential in the USA for a considerable period" and that structural and management changes had been made during the year to July. He added that Mr Kneen "is taking a pivotal role in rebuilding IndigoVision's North American business".Asia-Pacific sales fell 1% to £5.21m. Sales in Europe, the Middle East, and Africa fell 9% to £10.9m, Sales grew in the Middle East and Africa, were stable in Europe, but fell in the UK. However, Mr Kneen said sales in the UK had been showing growth in the opening weeks of the new financial year.IndigoVision is increasing its regular dividend for the year to July by 33% to 10p-a-share, with a final payout of 5p-a-share.

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IndigoVision hikes profits and declares £5m payout

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