Half Yearly Report

Released : 18/09/2013 07:00

RNS Number : 2543O

M&C Saatchi PLC

18 September 2013

 

 

 

 

 

 

M&C SAATCHI PLC

 

 

INTERIM RESULTS

 

 

SIX MONTHS ENDED

30 JUNE 2013

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

18 September 2013

M&C Saatchi PLC

Interim Results for the six months ended 30 June 2013

 

 

18 September 2013

Strong results, with good revenue momentum and earnings growth

 

 

Financial Highlights 2013

Growth versus 2012

Revenue

£87.1m

+  5% (2012: £82.8m)

 

Underlying Operating Profit

Operating Profit

£10.6m

£9.2m

+ 13% (2012: £9.4m)

+  6% (2012: £8.7m)

 

Profit Before Tax

£9.3m

+  6% (2012: £8.7m)

 

Earnings

EPS

£5.5m

8.58p

+ 11% (2012: £5.0m)

+  8% (2012: 7.95p)

 

Dividend

1.21p

+10% (2012: 1.10p)

 

         

The highlights are headline results, see note on next page for definition.

 

 

Operational Highlights

·      Successful first half with good revenue momentum and earnings growth

·      Global Network performed well:

°           UK: revenues up 8%, with CRM and mobile doing well

°           Europe: like-for-like revenues up 21%

°           Asia and Australasia: like-for-like revenues down 3%, largely as a result of  Chinese revenues now going through new associate aeiou

°           Middle East and Africa: like-for-like revenues up 54%

°           Americas: like-for-like revenues up 24%

o  Continued investment in new offices - Abu Dhabi, New York and Stockholm

o  Clear: profitability restored following restructuring of cost base. Strong new business pipeline in place and good momentum in the business

o  Strong balance sheet maintained with net cash of £20m

o  Interim dividend increased 10% to 1.21p 

 

 

 

 

Commenting on the results, David Kershaw, Chief Executive, said:

 

"M&C Saatchi has continued to make good headway over the first six months of 2013.  This stems from new business wins and flourishing new businesses.

 

"We delivered good earnings growth, whilst maintaining investment across our new offices.

 

"Looking ahead, we are confident that we will continue to make progress in 2013 and beyond. The strategy continues to deliver. "

 

For further information please call:

M&C Saatchi                         +44 (0)20-7543-4500

David Kershaw

 

Tulchan Communications     +44 (0)20-7353-4200

Lucy Legh

 

Numis Securities                  +44 (0)20-7260-1000

Nick Westlake, NOMAD

Charles Farquhar, Corporate Broking

 

Notes to Editors

Headline results

The term headline is not a defined term in IFRS. The items that are excluded from headline results are the amortisation or impairment of intangible assets (including goodwill, but excluding software) acquired in business combinations, changes to contingent and deferred consideration taken to the income statement; impairment of investment in associate; and fair value gains and losses on liabilities caused by our put and call option agreements. See note 4 for a reconciliation of non-headline to headline results.

Like-for-like

The like-for-like revenue comparisons referred to in this report are stated after excluding the impact of foreign currency movements.

 

Underlying Operating Profit

This is headline operating profit excluding the new office investment in Abu Dhabi, New York and Stockholm during the period.

 

Periods compared

This report comments on the unaudited consolidated income statement of M&C Saatchi plc (the "Group") for the six months to 30 June 2013 compared with unaudited consolidated income statement for the same period in 2012. 


 

 

 

SUMMARY OF RESULTS

 

The first six months of 2013 saw a good performance with revenue momentum and earnings growth. Like-for-like revenues increased 5% and we returned a double digit headline operating margin of 10.6%, whilst continuing to invest in three new offices (Abu Dhabi, New York and Stockholm). The headline profit before tax advanced 6% to £9.3m and headline net earnings rose an impressive 11%.

 

UK

We experienced a positive revenue increase in the UK of 8%, with our CRM and mobile businesses doing well. We also had a favourable run of account wins across our group of businesses, including Adidas, Club Med, HMG Cyber Security, Land Rover and Unipart, as well as winning the RBS and Boots digital businesses. In July, M&C Saatchi won the chemical company BASF's international corporate advertising account. This was led by the UK and Germany, who will co-ordinate a fully integrated corporate campaign across key markets including North America, Brazil, Asia Pacific and Europe. As ever, we maintain a close watch on costs as well as margins. This resulted in the headline operating margin holding at 20.6% (2012: 20.7%, both margins exclude the impact of Group recharges). The UK headline operating profit improved 7% on 2012.

 

Europe

Despite the economic backdrop, we made considerable progress in Europe with like-for-like revenues up 21%. Headline operating profit was down 5%, with some investment drag from Stockholm.  Stockholm has started exceptionally well, winning their first six pitches and developing an impressive client list that includes Carlsberg, Google, H&M, LG and Oxfam. Germany and Italy both excelled in the six months. The French economy was fragile, with little new business on the advertising front but our agency continued to benefit from digital and PR contributions. Spain struggled in a very challenging market but, as an associate, our investment there is just 25%.

 

Middle East and Africa

We made excellent progress in both Cape Town and Johannesburg. Revenues were up 54% from £2.8m to £4.3m and key wins in the period were Heineken and the City of Cape Town. The region's operating profit was down 17%, as a result of further investment in Abu Dhabi. We have added new management in Abu Dhabi, who we are confident will add revenues beyond our founding client Etihad.

  

Asia and Australasia

In Asia and Australasia, like-for-like revenue decreased 3% in the six months with our Chinese revenues now going through our new Shanghai associate aeiou. More importantly, the losses from China and New Zealand have been arrested, which meant the region's operating profit was up 38% and the operating margin rose to just under 10%. The aeiou merger has been very positive in upgrading our Chinese presence and reputation. New Zealand won the Ministry of Justice, which combined with a reduced cost base, means they too are no longer losing money. Australia had a steady first half in an increasingly challenging market. Following the loss of David Jones at the end of July, significant savings to their cost base have been made. Malaysia put in another excellent performance, which included winning 1Malaysia. Japan and India were both profitable, albeit on a relatively small-scale. Our Singapore office, which opened in February 2012, is already profitable after a year which is a great achievement. Their wins have included Government work, in particular the Ministry of Health.

 

Americas

In the Americas our revenues were up 24%. We continue to invest in New York, which is already proving a valuable office for the network's global pitches. The New York team have been establishing key relationships and are already working with General Electric, Pernod Ricard and Reckitt Benckiser. They continue to build their reputation, which is resulting in a growing new business pipeline. Further good progress was made in Los Angeles and Sao Paulo, which both continued to win new business.

 

Clear

After a difficult 2012, a rejuvenated and restructured Clear is back on track with a leaner cost base and a strong united management team. Operating profits increased 8% and margins were up nearly 5% to 13%. A clarified offer is being well received and has led to new business wins including Mitchells & Butlers, Dr Oetker, AMP and WWF as well as pharmaceutical projects from Reckitt Benckiser and Bristol-Myers Squibb. Clear's new business pipeline is also much healthier, aided by their Brand Desire research and a newly-formed Advisory Board.

 

 

Outlook

M&C Saatchi has continued to make good headway over the first six months of 2013.  This stems from new business wins and flourishing new businesses.

 

We delivered good earnings growth, whilst maintaining investment across our new offices.

 

Looking ahead, we are confident that we will continue to make progress in 2013 and beyond. The strategy continues to deliver.

 

 

 

 

.

 

M&C SAATCHI PLC

UNAUDITED CONSOLIDATED INCOME STATEMENT

ENDED 30 JUNE 2013

 

 

 

Six months
ended
30 June 2013

 

 

 

 

Six months
ended
30 June 2012

 

 

Year
ended
31 December 2012

 

 

Note

 

£000

 

 

 

£000

 

£000

 

 

 

 

 

 

 

 

 

 

BILLINGS

 

 

255,039

 

 

 

240,330

 

502,738

 

 

 

 

 

 

 

 

 

 

REVENUE

4

 

87,138

 

 

 

82,846

 

169,486

 

 

 

 

 

 

 

 

 

 

Operating costs

 

 

(78,288)

 

 

 

(74,494)

 

(153,731)

 

 

 

 

 

 

 

 

 

 

OPERATING PROFIT

4

 

8,850

 

 

 

8,352

 

15,755

 

 

 

 

 

 

 

 

 

 

Share of results of associates

 

 

7

 

 

 

13

 

91

Impairment of associate

 

 

-

 

 

 

-

 

(1,552)

Finance income

6

 

216

 

 

 

196

 

422

Finance costs

7

 

(4,873)

 

 

 

(2,593)

 

(4,835)

 

 

 

 

 

 

 

 

 

 

PROFIT BEFORE TAXATION

4

 

4,200

 

 

 

5,968

 

9,881

 

 

 

 

 

 

 

 

 

 

Taxation on profits

8

 

(2,902)

 

 

 

(2,542)

 

(5,357)

 

 

 

 

 

 

 

 

 

 

PROFIT FOR THE FINANCIAL PERIOD

 

 

1,298

 

 

 

3,426

 

4,524

 

 

 

 

 

 

 

 

 

 

Profit attributable to:

 

 

 

 

 

 

 

 

 

Equity shareholders of the Group

4

 

589

 

 

 

2,345

 

2,463

Non controlling interest

 

 

709

 

 

 

1,081

 

2,061

 

 

 

 

 

 

 

 

 

 

 

 

 

1,298

 

 

 

3,426

 

4,524

 

 

 

 

 

 

 

 

 

 

EARNINGS PER SHARE

4

 

 

 

 

 

 

 

 

Basic

 

 

0.91p

 

 

 

3.73p

 

3.89p

Diluted

 

 

0.85p

 

 

 

3.63p

 

3.59p

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

M&C SAATCHI PLC

UNAUDITED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

ENDED 30 JUNE 2013

 

 

 

 

Six months
ended
30 June 2013

 

 

 

 

Six months
ended
30 June 2012

 

 

Year
ended
31 December 2012

 

 

 

 

£000

 

 

 

£000

 

£000

 

Profit for the period

 

 

 

1,298

 

 

 

 

3,426

 

 

4,524

Other comprehensive income:

 

 

 

 

 

 

 

 

 

Exchange differences on translating foreign operations before  tax

 

 

(155)

 

 

 

(384)

 

(518)

Tax expense

 

 

-

 

 

 

(40)

 

56 

Other comprehensive income for the period net of tax

 

 

(155)

 

 

 

(424)

 

(462)

 

 

 

 

 

 

 

 

 

 

Total comprehensive income for the period

 

 

1,143

 

 

 

 

3,002

 

 

4,062

 

Total comprehensive income attributable to:

 

 

 

 

 

 

 

 

 

Equity shareholders of the Group

 

 

434

 

 

 

1,921

 

2,001

Non controlling  interests

 

 

709

 

 

 

1,081

 

2,061

 

 

 

1,143

 

 

 

3,002

 

4,062

 

 

M&C SAATCHI PLC

UNAUDITED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

AT 30 JUNE 2013

 

 

 

30 June 2013

 

 

 

30 June 2012

 

31 December 2012

 

 

 

£000

 

 

 

£000

 

£000

NON CURRENT ASSETS

 

 

 

 

 

 

 

 

 

Intangible assets

 

 

61,295

 

 

 

61,414

 

60,540

Investments in associates

 

 

759

 

 

 

2,226

 

756

Plant and equipment

 

 

8,116

 

 

 

7,033

 

7,237

Deferred tax assets

 

 

1,711

 

 

 

1,419

 

1,612

Other non current assets

 

 

4,656

 

 

 

5,562

 

5,041

 

 

 

76,537

 

 

 

77,654

 

75,186

 

 

 

 

 

 

 

 

 

 

CURRENT ASSETS

 

 

 

 

 

 

 

 

 

Trade and other receivables

 

 

82,224

 

 

 

73,027

 

95,248

Current tax assets

 

 

821

 

 

 

539

 

881

Cash and cash equivalents

 

 

23,927

 

 

 

18,066

 

22,332

 

 

 

106,972

 

 

 

91,632

 

118,461

 

 

 

 

 

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

 

 

 

 

Bank overdraft

 

 

(113)

 

 

 

-

 

(84)

Trade and other payables

 

 

(93,621)

 

 

 

(84,175)

 

(106,872)

Current tax liabilities

 

 

(2,888)

 

 

 

(2,138)

 

(3,809)

Other financial liabilities

 

 

(75)

 

 

 

(108)

 

(131)

Minority shareholder put options liabilities

 

 

(11,328)

 

 

 

(1,936)

 

(2,549)

 

 

 

(108,025)

 

 

 

(88,357)

 

(113,445)

 

 

 

 

 

 

 

 

 

 

NET CURRENT (LIABILITIES) / ASSETS

 

 

(1,053)

 

 

 

3,275

 

5,016

 

 

 

 

 

 

 

 

 

 

TOTAL ASSETS LESS CURRENT LIABILITIES

 

 

75,484

 

 

 

80,929

 

80,202

 

 

 

 

 

 

 

 

 

 

NON CURRENT LIABILITIES

 

 

 

 

 

 

 

 

 

Deferred tax liabilities

 

 

(642)

 

 

 

(918)

 

(669)

Other financial liabilities

 

 

(3,849)

 

 

 

(3,712)

 

(4,322)

Minority shareholder put options liabilities

 

 

(15,227)

 

 

 

(17,595)

 

(17,933)

Other non current liabilities

 

 

(509)

 

 

 

(411)

 

(1,092)

 

 

 

(20,227)

 

 

 

(22,636)

 

(24,016)

 

 

 

 

 

 

 

 

 

 

NET ASSETS

 

 

55,257

 

 

 

58,293

 

56,186

 

 

 

 

 

 

 

 

 

 


 

M&C SAATCHI PLC

UNAUDITED CONSOLIDATED BALANCE SHEET (CONTINUED)

AT 30 JUNE 2013

 

 

 

30 June 2013

 

 

 

30 June 2012

 

31 December
2012

 

 

 

£000

 

 

 

£000

 

£000

EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Share capital

 

 

681

 

 

 

637

 

641

Share premium

 

 

16,037

 

 

 

14,126

 

14,625

Merger reserve

 

 

20,669

 

 

 

21,194

 

20,669

Treasury reserve

 

 

(792)

 

 

 

(792)

 

(792)

Minority interest put option reserve

 

 

(15,904)

 

 

 

(14,305)

 

(13,675)

Non controlling interest acquired

 

 

(1,532)

 

 

 

(359)

 

(1,085)

Foreign exchange reserve

 

 

1,691

 

 

 

1,884

 

1,846

Retained earnings

 

 

31,906

 

 

 

33,243

 

31,373

EQUITY ATTRIBUTABLE TO SHAREHOLDERS OF THE GROUP

 

 

52,756

 

 

 

55,628

 

53,602

 

 

 

 

 

 

 

 

 

 

NON CONTROLLING INTERESTS

 

 

2,501

 

 

 

2,665

 

2,584

 

 

 

 

 

 

 

 

 

 

TOTAL EQUITY

 

 

55,257

 

 

 

58,293

 

56,186

 

M&C SAATCHI PLC

UNAUDITED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

SIX MONTHS ENDED 30 JUNE 2013

 

Share

Capital

£000

Share

premium

£000

Merger

reserve

£000

Treasury

reserve

£000

MI put option reserve

£000

Non controlling interest acquired
£000

Foreign exchange
reserves

£000

Retained

earnings

£000

Subtotal

£000

Non controlling

interest

in equity

£000

 

Total

£000

At 1 January 2012

635

13,832

21,194

(792)

(14,305)

(297)

2,308

30,808

53,383

2,663

56,046

Reserve movement for year ending 31 December 2012

 

 

 

 

 

 

 

Acquisition

-

-

-

-

-

-

-

-

-

71

71

Acquired non controlling interest

1

115

-

-

73

(120)

-

-

69

(18)

51

Issues of shares to minorities

-

-

-

-

-

-

-

(11)

(11)

26

15

Impairment of New Zealand

-

-

(525)

-

-

-

-

525

-

-

-

Subsidiary share buyback of own equity from a non controlling interest

-

-

-

-

-

(668)

-

-

(668)

(632)

(1,300)

Exchange rate movements

-

-

-

-

-

-

-

-

-

(61)

(61)

Issue of minority put options

-

-

-

-

(480)

-

-

-

(480)

-

(480)

Cancellation of minority put options

-

-

-

-

1,037

-

-

329

1,366

-

1,366

Option exercise

5

678

-

-

-

-

-

(686)

(3)

-

(3)

Share option charge

-

-

-

-

-

-

-

855

855

-

855

Dividends

-

-

-

-

-

-

-

(2,910)

(2,910)

(1,526)

(4,436)

Total transactions with owners

6

793

(525)

-

630

(788)

-

(1,898)

(1,782)

(2,140)

(3,922)

Total comprehensive income for the year

-

-

-

-

-

-

(462)

2,463

2,001

2,061

4,062

At 1 December 2012

641

14,625

20,669

(792)

(13,675)

(1,085)

1,846

31,373

53,602

2,584

56,186

 

 

 

 

 

 

 

 

 

 

 

 

At 1 January 2013

641

14,625

20,669

(792)

(13,675)

(1,085)

1,846

31,373

53,602

2,584

56,186

Reserve movement for six months ending 30 June 2013

 

 

 

 

 

 

 

 

Acquisitions

-

-

-

-

(986)

-

-

-

(986)

208

(778)

Issue of shares to minorities

-

-

-

-

(367)

-

-

-

(367)

101

(266)

Acquired non controlling interest

-

-

-

-

-

-

-

-

-

(108)

(108)

Sale shares to minorities

-

-

-

-

(1,323)

-

-

(203)

(1,526)

607

(919)

Exchange rate movements

-

-

-

-

-

-

-

-

-

25

25

Options exercise

35

131

-

-

-

-

-

(10)

156

(156)

-

Non Controlling interest acquired

5

1,281

-

-

447

(447)

-

-

1,286

-

1,286

Share option charge

-

-

-

-

-

-

-

157

157

-

157

Total transactions with owners

40

1,412

-

-

(2,229)

(447)

-

(56)

(1,280)

677

(603)

Dividends

-

-

-

-

-

-

-

-

-

(1,469)

(1,469)

Total comprehensive income for year

-

-

-

-

-

-

(155)

589

434

709

1,143

At 30 June 2013

681

16,037

20,669

(792)

(15,904)

(1,532)

1,691

31,906

52,756

2,501

55,257

 


 

 

M&C SAATCHI PLC

UNAUDITED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (CONTINUED)

SIX MONTHS ENDED 30 JUNE 2013

 

 

 

Share

Capital

£000

Share

premium

£000

Merger

reserve

£000

Treasury

reserve

£000

MI put option reserve

£000

Non controlling interest acquired
£000

Foreign exchange
reserves

£000

Retained

earnings

£000

Subtotal

£000

Non controlling

interest

in equity

£000

 

Total

£000

At 1 January 2012

635

13,832

21,194

(792)

(14,305)

(297)

2,308

30,808

53,383

2,663

56,046

Reserve movement for six months ending 30 June 2013

 

 

 

 

 

 

 

 

Issue of shares to minorities

-

-

-

-

-

-

-

-

-

11

11

Exchange rate movements

-

-

-

-

-

-

-

-

-

(2)

(2)

Options exercise

2

294

-

-

-

-

-

(296)

-

-

-

Non Controlling interest acquired

-

-

-

-

-

(62)

-

-

(62)

-

(62)

Share option charge

-

-

-

-

-

-

-

386

386

-

386

Total transactions with owners

2

294

-

-

-

(62)

-

90

324

9

333

Dividends

-

-

-

-

-

-

-

-

-

(1,088)

(1,088)

Total comprehensive income for year

-

-

-

-

-

-

(424)

2,345

1,921

1,081

3,002

At 30 June 2012

637

14,126

21,194

(792)

(14,305)

(359)

1,884

33,243

55,628

2,665

58,293

 

 

M&C SAATCHI PLC

UNAUDITED CONSOLIDATED CASH FLOW STATEMENT

SIX MONTHS ENDED 30 JUNE 2013

 

 

 

Six months ended
30 June 2013

 

 

 

Six months ended
30 June 2012

 

Year Ended
31 December 2012

 

Notes

£000

 

 

 

£000

 

£000

 

 

 

 

 

 

 

 

 

Revenue

 

87,138

 

 

 

82,846

 

169,486

Operating cost

 

(78,288)

 

 

 

(74,494)

 

(153,731)

 

 

 

 

 

 

 

 

 

Operating Profit

 

8,850

 

 

 

8,352

 

15,755

Adjustments for:

 

 

 

 

 

 

 

 

Depreciation of plant and equipment

 

1,240

 

 

 

1,114

 

2,289

Losses on sale of plant and equipment

 

38

 

 

 

-

 

99

Losses on sale of software intangibles

 

-

 

 

 

 

 

35

Amortisation on acquired intangible assets

 

352

 

 

 

303

 

705

Impairment of Goodwill

 

-

 

 

 

-

 

608

Amortisation of capitalised software intangible assets

 

76

 

 

 

69

 

141

Non-cash share based incentive plans

 

157

 

 

 

378

 

855

Operating cash flow before movements in working capital and provisions

 

10,713

 

 

 

10,216

 

 

20,487

Decrease / (increase) in trade and other receivables

 

15,449

 

 

 

15,212

 

(5,717)

Decrease in trade and other payables

 

(16,138)

 

 

 

(19,671)

 

4,194

Cash generated / (consumed) from operations

 

10,024

 

 

 

5,757

 

18,964

Tax paid

 

(3,333)

 

 

 

(2,247)

 

(5,178)

Net cash (out) / in flow from operating activities

 

6,691

 

 

 

3,510

 

13,786

Investing activities

 

 

 

 

 

 

 

 

Acquisitions net of cash acquired

10

(1,106)

 

 

 

(1,720)

 

(3,199)

Proceeds from sale of plant and equipment

 

33

 

 

 

-

 

28

Purchase of plant and equipment

 

(1,893)

 

 

 

(1,142)

 

(2,652)

Purchase of capitalised software

 

(28)

 

 

 

(95)

 

(163)

Dividend from associates

 

39

 

 

 

-

 

-

Interest earned

 

204

 

 

 

196

 

422

Net cash consumed by investing activities

 

(2,751)

 

 

 

(2,761)

 

(5,564)

Net cash generated / (consumed) by operating and investing activities

 

3,940

 

 

 

749

 

8,222


 

 

 

 

Six months ended
30 June 2013

 

 

 

Six months ended
30 June 2012

 

Year Ended
31 December
2012

 

Notes

£000

 

 

 

£000

 

£000

Net cash generated / (consumed by operating and investing activities

 

3,940

 

 

 

749

 

8,222

 

 

 

 

 

 

 

 

 

Dividends paid to equity holders of the Company

 

-

 

 

 

-

 

(2,910)

Dividends paid to non controlling interest

 

(1,469)

 

 

 

(1,088)

 

(1,526)

Subsidiaries' sale of own shares to minorities

 

-

 

 

 

11

 

30

Repayment of finance leases

 

(28)

 

 

 

(41)

 

(214)

Inception of bank loans

 

1,530

 

 

 

1,186

 

5,416

Repayment of bank loans

 

(2,130)

 

 

 

(1,272)

 

(4,755)

Interest paid

 

(158)

 

 

 

(154)

 

(390)

Net cash consumed from financing activities

 

(2,255)

 

 

 

 

(1,358)

 

 

(4,349)

 

 

 

 

 

 

 

 

 

Net increase / (decrease) in cash and cash equivalents

 

1,685

 

 

 

 

(609)

 

 

3,873

 

 

 

 

 

 

 

 

 

Cash and cash equivalents at the beginning of the period

 

22,248

 

 

 

18,779

 

18,779

Effect of exchange rate changes

 

(119)

 

 

 

(104)

 

(404)

CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD

 

23,814

 

 

 

 

18,066

 

 

22,248

 

 

 

 

 

 

 

 

 

 

 

M&C SAATCHI PLC

UNAUDITED NOTES TO THE INTERIM STATEMENTS

SIX MONTHS ENDED 30 JUNE 2013

 

1.   GENERAL INFORMATION

 

The Company is a public limited company incorporated and domiciled in the UK. The address of its registered office is 36 Golden Square, London W1F 9EE.

The Company has its primary listing on the AIM market of the London Stock Exchange.

This consolidated half-yearly financial information was approved for issue on
17 September 2013.

These results do not constitute the Group's statutory accounts.  The information presented in relation to 31 December 2012 is extracted from the statutory financial statements for the year then ended and which have been delivered to the Registrar of Companies. The auditor's report on the statutory financial statements for the year ended 31 December 2012 was unqualified, did not include references to any matters to which the auditors drew attention by way of emphasis without qualifying their report(s) and did not contain statements under Section 498 (2) or (3) of the Companies Act 2006.

 

2.   BASIS OF PREPARATION

 

This consolidated half-yearly financial information for the half-year ended 30 June 2013 has been prepared in accordance with the AIM Rules for companies. The half-yearly consolidated financial information should be read in conjunction with the annual financial statements for the year ended 31 December 2012.

 

3.   ACCOUNTING POLICIES

 

The financial information in these interim results is that of the holding company and all of its subsidiaries (the Group). It has been prepared in accordance with the recognition and measurement requirements of International Financial Reporting Standards as adopted for use in the EU (IFRSs). The accounting policies applied by the Group in this financial information are the same as those applied by the Group in its financial statements for the year ended 31 December 2012 and which will form the basis of the 2013 financial statements

 

4.   EARNINGS PER SHARE AND RECONCILIATION BETWEEN HEADLINE AND STATUTORY RESULTS

Six months ended
30 June 2013

 

Reported results

Amortisation
 of acquired intangibles

Fair value adjustments to minority put option liabilities

 

Headline & Segmental results

 

 

 

£000

£000

£000

 

£000

 

REVENUE

 

87,138

-

-

 

87,138

 

 

 

 

 

 

 

 

 

OPERATING PROFIT

 

8,850

352

-

 

9,202

 

Share of results of associates

 

7

-

-

 

7

 

Finance income

 

216

-

-

 

216

 

Finance expense

 

(4,873)

-

4,698

 

(175)

 

PROFIT BEFORE TAXATION

 

4,200

352

4,698

 

9,250

 

Taxation

 

(2,902)

(84)

-

 

(2,986)

 

PROFIT AFTER TAXATION

 

1,298

268

4,698

 

6,264

 

Non controlling interest

 

(709)

(16)

-

 

(725)

 

PROFIT ATTRIBUTABLE TO EQUITY HOLDERS OF THE GROUP

 

 

 

 

589

252

4,698

 

5,539

 

 

 

 

 

 

 

 

 

BASIC EARNINGS PER SHARE

 

 

 

 

 

 

 

 

 

 

Weighted average number of shares (thousands)

 

64,581

 

 

 

64,581

 

BASIC EPS

 

0.91p

 

 

 

8.58p

 

 

 

 

 

 

 

 

 

DILUTED EARNINGS PER SHARE

 

 

 

 

 

 

 

 

 

 

Weighted average number of shares (thousands) as above

 

64,581

 

 

 

64,581

 

Add

 

 

 

 

 

 

 

 - UK growth shares

 

1,411

 

 

 

1,411

 

 - Float options

 

128

 

 

 

128

 

 - Options

 

96

 

 

 

96

 

 - New Options

 

2,521

 

 

 

2,521

 

 - 2012 options LTIP

 

246

 

 

 

246

 

Total

 

68,983

 

 

 

68,983

 

DILUTED EARNINGS PER SHARE

 

0.85p

 

 

 

8.03p

 

                 


 

 

 

Six months ended
30 June 2012

 

Reported results

Amortisation
 of acquired intangibles

Fair value adjustments to minority put option liabilities

 

Headline & Segmental results

 

 

 

£000

£000

£000

 

£000

 

REVENUE

 

82,846

-

-

 

82,846

 

 

 

 

 

 

 

 

 

OPERATING PROFIT

 

8,352

303

-

 

8,655

 

Share of results of associates

 

13

-

-

 

13

 

Finance income

 

196

-

-

 

196

 

Finance expense

 

(2,593)

-

2,438

 

(155)

 

PROFIT BEFORE TAXATION

 

5,968

303

2,438

 

8,709

 

Taxation

 

(2,542)

(81)

-

 

(2,623)

 

PROFIT AFTER TAXATION

 

3,426

222

2,438

 

6,086

 

Non controlling interest

 

(1,081)

-

-

 

(1,081)

 

PROFIT ATTRIBUTABLE TO EQUITY HOLDERS OF THE GROUP

 

 

 

 

2,345

222

2,438

 

5,005

 

 

 

 

 

 

 

 

 

BASIC EARNINGS PER SHARE

 

 

 

 

 

 

 

 

 

 

Weighted average number of shares (thousands)

 

62,930

 

 

 

62,930

 

BASIC EPS

 

3.73p

 

 

 

7.95p

 

 

 

 

 

 

 

 

 

DILUTED EARNINGS PER SHARE

 

 

 

 

 

 

 

 

 

 

Weighted average number of shares (thousands) as above

 

62,930

 

 

 

62,930

 

Add

 

 

 

 

 

 

 

 - UK growth shares

 

1,620

 

 

 

1,620

 

 - Float options

 

128

 

 

 

128

 

Total

 

64,678

 

 

 

64,678

 

DILUTED EARNINGS PER SHARE

 

3.63p

 

 

 

7.74p

 

                 

 

 

Year ended 31 December 2012

 

Reported results

Amortisation of acquired
intangibles

Impairment
of Goodwill

                 Impairment
of associate

Fair value adjustments to minority
put option liabilities

Headline & segmental results

 

 

£000

£000

£000

£000

£000

£000

REVENUE

 

169,486

-

-

-

-

169,486

 

 

 

 

 

 

 

 

OPERATING PROFIT

 

15,755

705

608

-

-

17,068

Share of results of associates

 

91

-

-

-

-

91

Impairment of associate

 

(1,552)

-

-

1,552

-

-

Finance income

 

422

-

-

-

-

422

Finance cost

 

(4,835)

-

-

-

4,436

(399)

PROFIT BEFORE TAXATION

 

9,881

705

608

1,552

4,436

17,182

Taxation

 

(5,357)

(185)

-

-

-

(5,542)

PROFIT FOR THE YEAR

 

4,524

520

608

1,552

4,436

11,640

Non controlling interests

 

(2,061)

(19)

-

-

-

(2,080)

PROFIT ATTRIBUTABLE TO EQUITY HOLDERS OF THE GROUP

 

 

 

2,463

501

608

1,552

4,436

9,560

 

 

 

 

 

 

 

 

BASIC EARNINGS PER SHARE

 

 

 

 

 

 

 

 

 

Weighted average number of shares (thousands)

 

63,317

-

-

-

-

63,317

BASIC EPS

 

3.89p

-

-

-

-

15.10p

 

 

 

 

 

 

 

 

DILUTED EARNINGS PER SHARE

 

Weighted average number of shares (thousands) as above

 

 

 

 

 

 

63,317

-

-

-

-

63,317

Add

 

 

 

 

 

 

 

 - UK growth shares

 

1,581

-

-

-

-

1,581

 - Options

 

128

-

-

-

-

128

 - LTIP options 2012

 

111

-

-

-

-

111

 - New LTIP

 

3,547

 

 

 

 

3,547

Total

 

68,684

 

 

 

 

68,684

DILUTED EARNINGS PER SHARE

3.59p

 

 

 

 

13.92p

 

 

5.   SEGMENTAL INFORMATION

This segmental information is reconciled to the statutory results in Note 4.

Six months to 30 June 2013

 

UK

Europe

Middle East & Africa

Asia & Australasia

Americas

Clear

Total

 

 

£000

£000

£000

£000

£000

£000

£000

Revenue

 

39,142

9,471

4,305

26,257

3,961

4,002

87,138

 

 

 

 

 

 

 

 

 

Operating profit excluding group costs

8,051

1,059

275

2,592

(580)

528

11,925

Group costs

 

(2,565)

(36)

-

(83)

(39)

-

(2,723)

Operating profit

 

5,486

1,023

275

2,509

(619)

528

9,202

Share of result of associate

1

6

-

-

-

-

7

Finance income and costs

 

38

(35)

12

37

(12)

1

41

Profit before taxation

 

5,525

994

287

2,546

(631)

529

9,250

Taxation

 

(1,346)

(384)

(192)

(894)

(31)

(139)

(2,986)

Profit for the period

 

4,179

610

95

1,652

(662)

390

6,264

Non controlling interest

 

(533)

(28)

(108)

(352)

306

(10)

(725)

Profit attributable to equity holders of the group

3,646

582

(13)

1,300

(356)

380

5,539

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

HEADLINE BASIC EPS

 

 

 

 

8.58p

 

 

 

 

 

 

 

 

 

COSTS INCLUDED IN OPERATING PROFIT

 

PROFIT

 

 

 

Depreciation and amortisation of software

644

136

119

270

65

82

1,316

Share option charges

 

157

-

-

-

-

-

157

OFFICE LOCATION

London

Paris
Berlin Madrid Geneva
Milan
Moscow
Stockholm

 

Beirut
Cape Town Johannesburg
Abu Dhabi

 

Sydney Melbourne Auckland Wellington
Kuala Lumpur
New Delhi Mumbai
Hong Kong Shanghai
Tokyo
Singapore

Los Angeles
New York
Sao Paulo

London New York
Singapore
Sydney

 

 

Six months to 30 June 2012

 

UK

Europe

Middle East & Africa

Asia & Australasia

Americas

Clear

Total

 

 

£000

£000

£000

£000

£000

£000

£000

Revenue

 

36,315

7,825

2,800

26,999

3,193

5,714

82,846

 

 

 

 

 

 

 

 

 

Operating profit excluding group costs

7,512

1,115

330

1,880

(445)

489

10,881

Group costs

 

(2,039)

(36)

-

(112)

(39)

-

(2,226)

Operating profit

 

5,473

1,079

330

1,768

(484)

489

8,655

Share of result of associate

75

(93)

31

-

-

-

13

Finance income and costs

 

46

(20)

3

34

(24)

2

41

Profit before taxation

 

5,594

966

364

1,802

(508)

491

8,709

Taxation

 

(1,315)

(386)

(108)

(768)

82

(128)

(2,623)

Profit for the period

 

4,279

580

256

1,034

(426)

363

6,086

Non controlling interest

 

(518)

(178)

(121)

(381)

116

1

(1,081)

Profit attributable to equity holders of the group

3,761

402

135

653

(310)

364

5,005

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

HEADLINE BASIC EPS

 

 

 

 

7.95p

 

 

 

 

 

 

 

 

 

COSTS INCLUDED IN OPERATING PROFIT

 

PROFIT

 

 

 

Depreciation and amortisation of software

536

137

71

299

53

87

1,183

Share option charges

 

378

-

-

-

-

-

378

OFFICE LOCATION

London

Paris
Berlin Madrid Geneva
Milan
Moscow

 

Beirut
Cape Town Johannesburg
Abu Dhabi

 

Sydney Melbourne Auckland Wellington
Kuala Lumpur
New Delhi Mumbai
Hong Kong Shanghai
Tokyo
Singapore

Los Angeles
New York
Sao Paulo

London Amsterdam New York
Hong Kong
Singapore
Sydney

 

 

 

 

 

Year ended
31 December 2012

UK

Europe

Middle East & Africa

Asia and Australasia

Americas

Clear

Total

  

  

£000

£000

£000

£000

£000

£000

£000

Revenue

  

75,401

16,164

6,604

53,798

8,031

9,488

169,486

 

 

 

 

 

 

 

 

 

Operating profit excluding group costs

15,252

2,331

237

3,443

66

276

21,605

Group costs

 

(4,269)

(71)

-

(110)

(87)

-

(4,537)

Operating profit

10,983

2,260

237

3,333

(21)

276

17,068

Share of results of associates

77

(88)

102

-

-

-

91

Finance income and cost

 

75

(45)

15

14

(38)

2

23

Profit before taxation

 

11,135

2,127

354

3,347

(59)

278

17,182

Taxation

 

(2,956)

(743)

(167)

(1,566)

(52)

(58)

(5,542)

Profit for the year

 

8,179

1,384

187

1,781

(111)

220

11,640

Non controlling interests

 

(1,231)

(435)

(98)

(565)

255

(6)

(2,080)

Profit attributable to equity holders of the group

6,948

949

89

1,216

144

214

9,560

HEADLINE BASIC EPS

 

 

 

 

 

15.10p

COSTS INCLUDED IN OPERATING PROFIT

Depreciation

(1,118)

(250)

(144)

(527)

(79)

(171)

(2,289)

Amortisation of software

(1)

(30)

(25)

(61)

(24)

-

(141)

Share option charges

 

(855)

-

-

-

-

-

(855)

OFFICE LOCATION

London

Paris

Berlin

Madrid

Geneva

Milan
Moscow
Stockholm

Beirut

Cape Town

Jo'burg
Abu Dhabi

 

Sydney

Melbourne

Auckland

Wellington

New Delhi

Mumbai

Kuala Lumpur

Hong Kong

Beijing

Shanghai

Tokyo
Singapore

Los
Angeles

São Paulo

New York

London

Hong Kong

New York

Sydney
Singapore

 

 

 

 

6.   FINANCE INCOME

 

 

Six months
ended
30 June 2013

 

 

 

Six months
ended
30 June 2012

 

Year
 ended
31 December
2012

 

 

£000

 

 

 

£000

 

£000

 

 

 

 

 

 

 

 

 

 

Bank interest receivable

 

134

 

 

 

174

 

398

Other interest receivable

 

82

 

 

 

22

 

24

Total finance income

 

216

 

 

 

196

 

422

 

 

7.   FINANCE COSTS

 

 

 

Six months
ended
30 June 2013

 

 

 

Six months
ended
30 June 2012

 

Year
 ended
31 December
2012

 

 

£000

 

 

 

£000

 

£000

Finance costs

 

 

 

 

 

 

 

 

 

Bank interest payable

 

(153)

 

 

 

(134)

 

(390)

Other interest payable

 

(22)

 

 

 

(21)

 

(9)

Total interest payable

 

(175)

 

 

 

(155)

 

(399)

 

 

 

 

 

 

 

 

 

Fair value adjustments to minority shareholder put option liabilities

 

(4,698)

 

 

 

(2,438)

 

(4,436)

Total

 

(4,873)

 

 

 

(2,593)

 

(4,835)

8.   TAXATION

 

Income tax expenses are recognised based on management's estimate of the average annual headline income tax expected for the full financial year.

 

The estimated headline effective annual tax rate (excluding associates) used for the period to 30 June 2013 is 32.5% (30 June 2012: 30.2%).

The increase in the headline tax rate is due to losses in subsidiaries that we are investing in.

 

The estimated effective annual tax rate for the period to 30 June 2013 is 69.1% (30 June 2012: 42.6%).

The difference between the headline and statutory tax rates is caused by a difference in the profit before tax due to the impact of fair value adjustments to minority shareholder put option liabilities that have no effect on the tax charge.

 

9.   DIVIDENDS

 

 

 

Six months
ended
30 June 2013

 

 

 

Six months
ended
30 June 2012

 

Year
 ended
31 December
2012

 

 

£000

 

 

 

£000

 

£000

 

 

 

 

 

 

 

 

 

 

2011 final dividend 3.50p (2010: 3.03p)

 

-

 

 

 

-

 

2,213

2012 interim dividend 1.10p (2011: 1.00p)

 

-

 

 

 

-

 

697

 

 

 

 

 

 

 

 

 

 

 

-

 

 

 

-

 

2,910

 

The directors propose an interim dividend of 1.21p per share (2012: 1.10p per share) payable on 15 November 2013 to shareholders who are on the register at 1 November 2013. This interim dividend, amounting to £824k (2012: £697k) has not been recognised as a liability in this half-yearly financial report. 

10. CASH CONSUMED BY ACQUISITIONS

 

 

 

Six months
ended
30 June 2013

 

 

 

Six months
ended
30 June 2012

 

Year
 ended
31 December
2012

 

 

 

£000

 

 

 

£000

 

£000

Acquisitions

 

 

 

 

 

 

 

 

 

Initial cash consideration paid

 

 

(1,580)

 

 

 

(1,743)

 

(3,206)

Cash and cash equivalents acquired

 

 

474

 

 

 

23

 

7

Total payments made in the period relating to acquisitions

 

 

(1,106)

 

 

 

(1,720)

 

(3,199)

 

 

 

 

 

 

 

 

 

 

 


This information is provided by RNS

The company news service from the London Stock Exchange

 

END

 

 

IR SFLEEWFDSESU