Half Yearly Report
Released : 10/09/2015 07:00
RNS Number : 5667Y
M&C Saatchi PLC
10 September 2015
M&C SAATCHI PLC
INTERIM RESULTS
SIX MONTHS ENDED
30 JUNE 2015
10 September 2015
M&C Saatchi PLC
Interim results for the six months ended 30 June 2015
10 September 2015
Strong revenue momentum and earnings growth
|
|
|
|||
|
Financial Highlights 2015 |
Growth versus 2014 |
|||
|
Revenue |
£87.5m |
+ 6% (2014: £82.6m) |
|
|
|
Revenue in constant currencies Operating Profit |
£9.3m |
+ 9% + 16% (2014: £8.0m) |
|
|
|
Profit Before Tax |
£9.6m |
+ 13% (2014: £8.5m) |
|
|
|
Earnings EPS |
£6.4m 8.96p |
+ 25% (2014: £5.1m) + 13% (2014: 7.96p) |
|
|
|
Dividend |
1.61p |
+ 15% (2014: 1.40p) |
|
|
The highlights are headline results, see note on next page for definition.
Operational Highlights
· Successful first half with strong revenue momentum and earnings growth
· Global Network performed well:
° UK: revenues up 9%
° Europe: like-for-like revenues up 12%
° Middle East and Africa: like-for-like revenues up 3%
° Asia and Australasia: like-for-like revenues up 6%
° Americas: like-for-like revenues up 19%
· Balance sheet maintained with net cash of £1.6m
· Interim dividend increased 15% to 1.61p
Commenting on the results, David Kershaw, Chief Executive, said:
"M&C Saatchi has made good headway over the first six months of 2015. We produced positive revenue momentum and earnings growth.
"This stems from new business wins and continuing widening of our business offering.
"Looking ahead, we are confident that we will continue to make progress in the full year and beyond. The strategy is consistent and 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
Andrew Grant
Louise Högberg
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 deferred and contingent consideration and other acquisition related charges 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 (whether accounted under IFRS2 or IRS39).
Like-for-like
The like-for-like revenue comparisons referred to in this report are stated after excluding the impact of foreign currency movements.
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 2015 compared with unaudited consolidated income statement for the same period in 2014.
SUMMARY OF RESULTS
The first six months of 2015 saw strong revenue momentum and earnings growth. Like-for-like revenues increased 9% and we returned a headline operating margin of 10.6%, up from 9.7% in 2014. The headline profit before tax advanced 13% to £9.6m and headline net earnings rose 25%.
UK
We posted a good revenue increase in the UK of 9%, with our CRM and mobile operations continuing to do particularly well. In addition, M&C Saatchi PR and our Sport & Entertainment division as well as our research operation The Source all performed strongly. We experienced a favourable run of account wins across our group of businesses in the first half, including Airbus, Carnival, Oxfam, some adult health projects for Public Health England, Royal Mail, sofa.com, Pernod Ricard's Passport Scotch and Unilever's Toni & Guy. We are rolling out LIDA, our CRM agency together with M&C Saatchi PR internationally, which follows successful roll-outs in recent years of our Mobile and Sport & Entertainment operations. In addition, we have started a new shopper agency, to help clients drive purchase conversion. As ever, we retained a careful watch on costs to support margins. This resulted in a headline operating margin of 14.2% (2014: 14.7%, both margins exclude the impact of Group recharges). The UK headline operating profit improved 5% on 2014.
Europe
We made further notable progress in Europe with like-for-like revenues up 12%. Headline operating profit was up 8%, with a headline operating margin of 12.7%. Our Stockholm office has maintained its strong new business performance and significantly won EON in June. Both Germany and Italy again produced excellent results, with Italy winning Becks, ING and Unicredit. Our Swiss office continues to do well and has started a pharmaceutical marketing business, which has already won clients. In France, advertising remained sluggish but our agency benefited from positive digital and PR contributions. In July, we acquired a minority stake in INSPI(RED) and formed M&C Saatchi Istanbul. Our associate in Spain fared a bit better compared with recent years, winning the state train operator RENFE as well as some assignments from Google.
Middle East and Africa
Like-for-like revenues in the Middle East and Africa were up 3%, with a slow start but a stronger second half anticipated. We see good full-year growth in both Cape Town and Johannesburg; key wins to date include some Continental Tyres projects and significantly Nando's. Our Abu Dhabi office is steadily building revenues beyond Etihad and won projects from new clients. In January, we acquired a majority stake in Ben-Natan Golan Advertising in Tel Aviv, Israel, forming a new agency M&C Saatchi Tel Aviv. With our associate in Beirut and our office in Abu Dhabi, we now potentially have a strong presence in the region. Overall with the slow start, the operating profit off a low base was down 41% and headline operating margin fell from 12.0% to 6.8%.
Asia and Australasia
In Asia and Australasia, like-for-like revenue increased 6% in the period. Australian revenues were up following their excellent new business run in 2014. Our associate in China continues to impress and work well. Malaysia made another very good contribution and won the global relaunch of Malaysian Airlines. Singapore picked up some more Government work for the Ministry of Health. The headline regional operating margin was up from 11.5% to 12.0%, with operating profit up 3%.
Americas
In the Americas our like-for-like revenues were up 19%. Our SS+K associate relationship in New York has started very well. They won the international account of J W Marriott with network support as well as the Comcast account. We are now looking to further bolster our presence in New York and are considering CRM acquisition possibilities. Our office in Los Angeles made valuable progress, extending its offering into digital content for the entertainment sector and social media through the addition of the Heavenspot team. In February, we upgraded our Sao Paulo presence, replicating the investment approach we took in China. We took a 25% investment in Santa Clara, a high quality independent agency who will be a powerful addition to our network. Overall, the operating profit increased from £0.6m to an impressive £1.7m with the operating margin up from 7.7% to 17.3%.
Outlook
M&C Saatchi has made good headway over the first six months of 2015. We produced positive revenue momentum and earnings growth. This stems from new business wins and continuing widening of our business offering. Looking ahead, we are confident that we will continue to make progress in the full year and beyond. The strategy is consistent and continues to deliver.
M&C SAATCHI PLC
UNAUDITED CONSOLIDATED INCOME STATEMENT
ENDED 30 JUNE 2015
|
|
|
|
Six months
|
|
|
|
Six months
|
|
Year
|
|
|
Note |
|
£000 |
|
|
|
£000 |
|
£000 |
|
|
|
|
|
|
|
|
|
|
|
BILLINGS |
|
|
182,340 |
|
|
|
158,614 |
|
333,302 |
|
|
|
|
|
|
|
|
|
|
|
REVENUE |
4 |
|
87,568 |
|
|
|
82,616 |
|
169,373 |
|
|
|
|
|
|
|
|
|
|
|
|
Operating costs |
|
|
(79,242) |
|
|
|
(74,980) |
|
(163,720) |
OPERATING PROFIT |
4 |
|
8,326 |
|
|
|
7,636 |
|
5,653 |
|
|
|
|
|
|
|
|
|
|
|
|
Share of results of associates |
|
|
541 |
|
|
|
573 |
|
1,350 |
|
Finance income |
6 |
|
154 |
|
|
|
5,386 |
|
316 |
|
Finance costs |
7 |
|
(618) |
|
|
|
(193) |
|
(1,087) |
PROFIT BEFORE TAXATION |
4 |
|
8,403 |
|
|
|
13,402 |
|
6,232 |
|
Taxation on profits |
8 |
|
(1,980) |
|
|
|
(2,331) |
|
(4,293) |
|
PROFIT FOR THE FINANCIAL PERIOD |
|
|
6,423 |
|
|
|
11,071 |
|
1,939 |
|
|
|
|
|
|
|
|
|
|
|
|
Profit attributable to: |
|
|
|
|
|
|
|
|
|
|
Equity shareholders of the Group |
4 |
|
5,203 |
|
|
|
10,065 |
|
(155) |
|
Non controlling interest |
|
|
1,220 |
|
|
|
1,006 |
|
2,094 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,423 |
|
|
|
11,071 |
|
1,939 |
|
|
|
|
|
|
|
|
|
|
|
EARNINGS PER SHARE |
4 |
|
|
|
|
|
|
|
|
|
Basic |
|
|
7.36p |
|
|
|
15.76p |
|
(0.24)p |
|
Diluted |
|
|
7.36p |
|
|
|
14.89p |
|
(0.24)p |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of the above numbers to the Headline numbers, discussed in the front of this report, can be found in note 4 page 16 to 18.
M&C SAATCHI PLC
UNAUDITED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
ENDED 30 JUNE 2015
|
|
|
|
Six months |
|
|
|
Six months |
|
Year |
|
|
|
|
£000 |
|
|
|
£000 |
|
£000 |
|
Profit for the period |
|
|
6,423 |
|
|
|
11,071 |
|
1,939 |
|
Other comprehensive income: |
|
|
|
|
|
|
|
|
|
|
Exchange differences on translating foreign operations |
|
|
(1,738) |
|
|
|
(343) |
|
(1,212) |
|
Total other comprehensive income for the period net of tax |
|
|
(1,738) |
|
|
|
(343) |
|
(1,212) |
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income for the period |
|
|
4,685
|
|
|
|
10,728
|
|
727 |
|
Total comprehensive income attributable to: |
|
|
|
|
|
|
|
|
|
|
Equity shareholders of the Group |
|
|
3,465 |
|
|
|
9,722 |
|
(1,367) |
|
Non controlling interests |
|
|
1,220 |
|
|
|
1,006 |
|
2,094 |
|
|
|
|
4,685 |
|
|
|
10,728 |
|
727 |
M&C SAATCHI PLC
UNAUDITED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AT 30 JUNE 2015
|
|
|
|
30 June 2015 |
|
|
|
30 June 2014 |
|
31 December 2014 |
|
|
|
|
£000 |
|
|
|
£000 |
|
£000 |
|
NON CURRENT ASSETS |
|
|
|
|
|
|
|
|
|
|
Intangible assets |
|
|
28,382 |
|
|
|
35,086 |
|
29,142 |
|
Investments in associates |
|
|
22,095 |
|
|
|
13,619 |
|
18,731 |
|
Plant and equipment |
|
|
7,801 |
|
|
|
7,575 |
|
8,409 |
|
Deferred tax assets |
|
|
1,770 |
|
|
|
1,352 |
|
1,515 |
|
Other non current assets |
|
|
7,792 |
|
|
|
5,540 |
|
5,899 |
|
|
|
|
67,840 |
|
|
|
63,172 |
|
63,696 |
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT ASSETS |
|
|
|
|
|
|
|
|
|
|
Trade and other receivables |
|
|
74,303 |
|
|
|
65,932 |
|
71,043 |
|
Current tax assets |
|
|
32 |
|
|
|
822 |
|
318 |
|
Cash and cash equivalents |
|
|
26,104 |
|
|
|
20,056 |
|
23,446 |
|
|
|
|
100,439 |
|
|
|
86,810 |
|
94,807 |
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT LIABILITIES |
|
|
|
|
|
|
|
|
|
|
Bank overdraft |
|
|
(151) |
|
|
|
(111) |
|
(125) |
|
Trade and other payables |
|
|
(74,894) |
|
|
|
(63,069) |
|
(75,995) |
|
Current tax liabilities |
|
|
(801) |
|
|
|
(2,617) |
|
(1,995) |
|
Other financial liabilities |
|
|
(125) |
|
|
|
(14) |
|
(22) |
|
Deferred and contingent consideration |
|
|
- |
|
|
|
(215) |
|
- |
|
Minority shareholder put options liabilities |
|
|
(15,566) |
|
|
|
(12,862) |
|
(15,835) |
|
|
|
|
(91,537) |
|
|
|
(78,888) |
|
(93,972) |
|
|
|
|
|
|
|
|
|
|
|
|
NET CURRENT ASSETS / (LIABILITIES) |
|
|
8,902 |
|
|
|
7,922 |
|
835 |
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS LESS CURRENT LIABILITIES |
|
|
76,742 |
|
|
|
71,094 |
|
64,531 |
|
|
|
|
|
|
|
|
|
|
|
|
NON CURRENT LIABILITIES |
|
|
|
|
|
|
|
|
|
|
Deferred tax liabilities |
|
|
(254) |
|
|
|
(439) |
|
(422) |
|
Other financial liabilities |
|
|
(24,389) |
|
|
|
(10,349) |
|
(18,226) |
|
Minority shareholder put options liabilities |
|
|
(7,303) |
|
|
|
(14,361) |
|
(8,708) |
|
Other non current liabilities |
|
|
(1,049) |
|
|
|
(947) |
|
(1,303) |
|
|
|
|
(32,995) |
|
|
|
(26,096) |
|
(28,659) |
|
|
|
|
|
|
|
|
|
|
|
|
NET ASSETS |
|
|
43,747 |
|
|
|
44,998 |
|
35,872 |
|
|
|
|
|
|
|
|
|
|
|
M&C SAATCHI PLC
UNAUDITED CONSOLIDATED BALANCE SHEET (CONTINUED)
AT 30 JUNE 2015
|
|
|
|
30 June 2015 |
|
|
|
30 June 2014 |
|
31 December |
|
|
|
|
£000 |
|
|
|
£000 |
|
£000 |
|
EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share capital |
|
|
725 |
|
|
|
647 |
|
683 |
|
Share premium |
|
|
19,727 |
|
|
|
16,402 |
|
16,807 |
|
Merger reserve |
|
|
29,335 |
|
|
|
22,405 |
|
27,689 |
|
Treasury reserve |
|
|
(792) |
|
|
|
(792) |
|
(792) |
|
Minority interest put option reserve |
|
|
(14,041) |
|
|
|
(15,594) |
|
(13,070) |
|
Non controlling interest acquired |
|
|
(9,068) |
|
|
|
(2,540) |
|
(7,882) |
|
Foreign exchange reserve |
|
|
(2,406) |
|
|
|
201 |
|
(668) |
|
Retained earnings |
|
|
14,949 |
|
|
|
21,898 |
|
9,639 |
|
TOTAL SHAREHOLDERS FUNDS |
|
|
38,429 |
|
|
|
42,627 |
|
32,406 |
|
|
|
|
|
|
|
|
|
|
|
|
NON CONTROLLING INTERESTS |
|
|
5,318 |
|
|
|
2,371 |
|
3,466 |
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL EQUITY |
|
|
43,747 |
|
|
|
44,998 |
|
35,872 |
M&C SAATCHI PLC
UNAUDITED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (CONTINUED)
SIX MONTHS ENDED 30 JUNE 2015
|
|
Share |
Share |
Merger reserve £000 |
Treasury |
MI put option reserve |
Non controlling interest acquired |
Foreign exchange |
Retained |
Subtotal |
Non controlling |
Total |
|
At 1 January 2015 |
683 |
16,807 |
27,689 |
(792) |
(13,070) |
(7,882) |
(668) |
9,639 |
32,406 |
3,466 |
35,872 |
|
Reserve movement for six months ending 30 June 2015 |
|
|
|
|
|
|
|
|
|
||
|
Exercise of put options |
12 |
2,612 |
1,646 |
- |
1,201 |
(1,201) |
- |
(48) |
4,222 |
36 |
4,258 |
|
Issue of put options |
- |
- |
- |
- |
(2,214) |
- |
- |
- |
(2,214) |
1,805 |
(409) |
|
Disposal of a subsidiary |
- |
- |
- |
- |
- |
- |
- |
(72) |
(72) |
181 |
109 |
|
Exchange rate movements |
- |
- |
- |
- |
42 |
15 |
- |
- |
57 |
(110) |
(53) |
|
Share option exercise |
30 |
308 |
- |
- |
- |
- |
- |
(3) |
335 |
(338) |
(3) |
|
Share option charge |
- |
- |
- |
- |
- |
- |
- |
230 |
230 |
- |
230 |
|
Dividends |
- |
- |
- |
- |
- |
- |
- |
- |
- |
(942) |
(942) |
|
Total transactions with owners |
42 |
2,920 |
1,646 |
- |
(971) |
(1,186) |
- |
107 |
2,558 |
632 |
3,190 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income for year |
- |
- |
- |
- |
- |
- |
(1,738) |
5,203 |
3,465 |
1,220 |
4,685 |
|
At 30 June 2015 |
725 |
19,727 |
29,335 |
(792) |
(14,041) |
(9,068) |
(2,406) |
14,949 |
38,429 |
5,318 |
43,747 |
M&C SAATCHI PLC
UNAUDITED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (CONTINUED)
SIX MONTHS ENDED 30 JUNE 2015
|
|
Share |
Share |
Merger reserve £000 |
Treasury |
MI put option reserve |
Non controlling interest acquired |
Foreign exchange |
Retained |
Subtotal |
Non controlling |
Total |
|
At 1 January 2014 |
690 |
16,402 |
16,736 |
(792) |
(16,587) |
(1,532) |
544 |
33,070 |
48,531 |
2,293 |
50,824 |
|
Reserve movement for six months ending 30 June 2014 |
|
|
|
|
|
|
|
|
|||
|
Exercise of put options |
20 |
- |
5,669 |
- |
1,008 |
(1,008) |
- |
- |
5,689 |
(9) |
5,680 |
|
Share buy back |
(63) |
- |
- |
- |
- |
- |
- |
(21,414) |
(21,477) |
- |
(21,477) |
|
Exchange rate movements |
- |
- |
- |
- |
(15) |
- |
- |
- |
(15) |
(10) |
(25) |
|
Share option charge |
- |
- |
- |
- |
- |
- |
- |
177 |
177 |
- |
177 |
|
Total transactions with owners |
(43) |
- |
5,669 |
- |
993 |
(1,008) |
- |
(21,237) |
(15,626) |
(19) |
(15,645) |
|
Dividends |
- |
- |
- |
- |
- |
- |
- |
- |
- |
(909) |
(909) |
|
Total comprehensive income for year |
- |
- |
- |
- |
- |
- |
(343) |
10,065 |
9,722 |
1,006 |
10,728 |
|
At 30 June 2014 |
647 |
16,402 |
22,405 |
(792) |
(15,594) |
(2,540) |
201 |
21,898 |
42,627 |
2,371 |
44,998 |
M&C SAATCHI PLC
UNAUDITED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
SIX MONTHS ENDED 30 JUNE 2015
|
|
Share |
Share |
Merger reserve £000 |
Treasury |
MI put option reserve |
Non controlling interest acquired |
Foreign exchange |
Retained |
Subtotal |
Non controlling |
Total |
|
At 1 January 2014 |
690 |
16,402 |
16,736 |
(792) |
(16,587) |
(1,532) |
544 |
33,070 |
48,531 |
2,293 |
50,824 |
|
Reserve movement for year ending 31 December 2014 |
|
|
|
|
|
|
|
|
|||
|
Acquisition |
- |
- |
- |
- |
(1,653) |
- |
- |
- |
(1,653) |
5 |
(1,648) |
|
Exercise of put options |
47 |
- |
13,011 |
- |
5,151 |
(4,791) |
- |
- |
13,419 |
(429) |
12,990 |
|
Deletion of right of equity |
- |
- |
- |
- |
- |
(1,559) |
- |
- |
(1,559) |
1,559 |
- |
|
Exchange rate movements |
- |
- |
- |
- |
19 |
- |
- |
- |
19 |
(121) |
(102) |
|
Tender offer |
(63) |
- |
- |
- |
- |
- |
- |
(21,451) |
(21,514) |
- |
(21,514) |
|
Merger reserve release on impairments |
- |
- |
(2,058) |
- |
- |
- |
- |
2,058 |
- |
- |
- |
|
Option exercise |
8 |
405 |
- |
- |
- |
- |
- |
(413) |
- |
- |
- |
|
Share option charge |
- |
- |
- |
- |
- |
- |
- |
200 |
200 |
- |
200 |
|
Dividends |
- |
- |
- |
- |
- |
- |
- |
(3,670) |
(3,670) |
(1,935) |
(5,605) |
|
Total transactions with owners |
(7) |
405 |
10,953 |
- |
3,517 |
(6,350) |
- |
(23,276) |
(14,758) |
(921) |
(15,679) |
|
Total comprehensive income for the year |
- |
- |
- |
- |
- |
- |
(1,212) |
(155) |
(1,367) |
2,094 |
727 |
|
At 1 December 2014 |
683 |
16,807 |
27,689 |
(792) |
(13,070) |
(7,882) |
(668) |
9,639 |
32,406 |
3,466 |
35,872 |
|
|
|
|
|
|
|
|
|
|
|
|
|
M&C SAATCHI PLC
UNAUDITED CONSOLIDATED CASH FLOW STATEMENT
SIX MONTHS ENDED 30 JUNE 2015
|
|
|
Six months ended |
|
|
|
Six months ended |
|
Year Ended |
|
|
|
Notes |
£000 |
|
|
|
£000 |
|
£000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
87,568 |
|
|
|
82,616 |
|
169,373 |
|
|
Operating cost |
|
(79,242) |
|
|
|
(74,980) |
|
(163,720) |
|
|
Operating Profit |
|
8,326 |
|
|
|
7,636 |
|
5,653 |
|
|
Adjustments for: |
|
|
|
|
|
|
|
|
|
|
Depreciation of plant and equipment |
|
1,120 |
|
|
|
1,065 |
|
2,055 |
|
|
Losses on sale of plant and equipment |
|
9 |
|
|
|
137 |
|
198 |
|
|
Loss on disposal of a subsidiary |
|
85 |
|
|
|
- |
|
76 |
|
|
Loss on acquisition of a subsidiary |
|
- |
|
|
|
- |
|
813 |
|
|
Profit on disposal of associate |
|
(142) |
|
|
|
- |
|
- |
|
|
Amortisation on acquired intangible assets |
|
684 |
|
|
|
370 |
|
1,445 |
|
|
Impairment of goodwill |
|
- |
|
|
|
- |
|
5,573 |
|
|
Amortisation of capitalised software intangible assets |
50 |
|
|
|
59 |
|
120 |
|
|
|
Equity settled share based payment expenses |
|
230 |
|
|
|
177 |
|
200 |
|
|
Operating cash flow before movements in working capital and provisions |
|
10,362 |
|
|
|
9,444 |
|
16,133 |
|
|
Increase in trade and other receivables |
|
(9,182) |
|
|
|
(3,494) |
|
(8,690) |
|
|
Decrease in trade and other payables |
|
4,569 |
|
|
|
(989) |
|
8,676 |
|
|
Cash generated from operations |
|
5,749 |
|
|
|
4,961 |
|
16,119 |
|
|
Tax paid |
|
(2,081) |
|
|
|
(3,066) |
|
(5,332) |
|
|
Net cash inflow from operating activities |
3,668 |
|
|
|
1,895 |
|
10,787 |
|
|
|
Investing activities |
|
|
|
|
|
|
|
|
|
|
Acquisitions net of cash acquired |
10 |
(564) |
|
|
|
(1,374) |
|
(2,244) |
|
|
Acquisitions of associates |
10 |
(3,349) |
|
|
|
- |
|
(5,084) |
|
|
Acquisition of investments |
|
(335) |
|
|
|
(224) |
|
(1,187) |
|
|
Proceeds from sale of associate |
|
97 |
|
|
|
- |
|
- |
|
|
Proceeds from sale of plant and equipment |
|
- |
|
|
|
30 |
|
70 |
|
|
Purchase of plant and equipment |
|
(638) |
|
|
|
(1,504) |
|
(3,350) |
|
|
Purchase of capitalised software |
|
(5) |
|
|
|
(24) |
|
(77) |
|
|
Dividend from associates |
|
76 |
|
|
|
82 |
|
660 |
|
|
Interest earned |
|
154 |
|
|
|
31 |
|
307 |
|
|
Net cash consumed by investing activities |
|
(4,564) |
|
|
|
(2,983) |
|
(10,905) |
|
|
Net cash consumed by operating and investing activities |
|
(896) |
|
|
|
(1,088) |
|
(118) |
|
|
|
|
Six months ended |
|
|
|
Six months ended |
|
Year Ended |
|
|
|
£000 |
|
|
|
£000 |
|
£000 |
|
Net cash consumed by operating and investing activities |
|
(896) |
|
|
|
(1,088) |
|
(118) |
|
|
|
|
|
|
|
|
|
|
|
Dividends paid to equity holders of the Company |
|
- |
|
|
|
- |
|
(3,670) |
|
Purchase of own shares |
|
- |
|
|
|
(21,477) |
|
(21,514) |
|
Dividends paid to non controlling interest |
|
(1,912) |
|
|
|
(909) |
|
(1,935) |
|
Issue of own shares |
|
497 |
|
|
|
- |
|
1 |
|
Repayment of finance leases |
|
(17) |
|
|
|
(22) |
|
(61) |
|
Inception of bank loans |
|
6,451 |
|
|
|
10,022 |
|
17,913 |
|
Repayment of bank loans |
|
(293) |
|
|
|
- |
|
- |
|
Interest paid |
|
(378) |
|
|
|
(187) |
|
(532) |
|
Net cash generated / (consumed) from financing activities |
|
4,348
|
|
|
|
(12,573)
|
|
(9,798) |
|
|
|
|
|
|
|
|
|
|
|
Net increase / (decrease) in cash and cash equivalents |
|
3,452
|
|
|
|
(13,661)
|
|
(9,916) |
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at the beginning of the period |
|
23,321 |
|
|
|
33,587 |
|
33,587 |
|
Effect of exchange rate changes |
|
(820) |
|
|
|
19 |
|
(350) |
|
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD |
|
25,953
|
|
|
|
19,945
|
|
23,321 |
|
|
|
|
|
|
|
|
|
|
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 9 September 2015.
These results do not constitute the Group's statutory accounts. The information presented in relation to 31 December 2014 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 2014 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 2015 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 2014.
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 2014 and which will form the basis of the 2015 financial statements.
4. EARNINGS PER SHARE AND RECONCILIATION BETWEEN HEADLINE AND STATUTORY RESULTS
The analysis below provides a reconciliation between the Group's statutory results and the headline results.
|
Six Months to |
|
|
Amortisation £000 |
Profit on disposal of an associate £000 |
Loss on disposal of subsidiary |
Contingent acquisition cost classified as expense |
Fair value adjustments to minority put option liabilities |
Headline £000 |
|
Revenue |
|
87,568 |
- |
- |
- |
- |
- |
87,568 |
|
Operating profit |
|
8,326 |
684 |
(142) |
85 |
142 |
200 |
9,295 |
|
Share of results of associates & JV |
|
541 |
- |
- |
- |
- |
- |
541 |
|
Finance income |
|
154 |
- |
- |
- |
- |
- |
154 |
|
Finance cost |
|
(618) |
- |
- |
- |
- |
238 |
(380) |
|
Profit before taxation |
|
8,403 |
684 |
(142) |
85 |
142 |
438 |
9,610 |
|
Taxation |
|
(1,980) |
(124) |
71 |
- |
- |
- |
(2,033) |
|
Profit for the year |
|
6,423 |
560 |
(71) |
85 |
142 |
438 |
7,577 |
|
Non controlling interests |
(1,220) |
(27) |
- |
- |
- |
- |
(1,247) |
|
|
Profit attributable to equity holders of the Group |
5,203 |
533 |
(71) |
85 |
142 |
438 |
6,330 |
|
|
BASIC AND DILUTED EARNINGS PER SHARE* |
|
|
|
|
|
|||
|
Weighted average number of shares (Thousands) |
70,677 |
|
|
|
|
|
70,677 |
|
|
Basic and diluted EPS* |
|
7.36p |
|
|
|
|
|
8.96p |
|
|
|
|
|
|
|
|
|
|
* At 30 June 2015 there are no dilutive options, so basic and diluted EPS are the same.
The Directors believe that the headline results and headline earnings per share provide additional useful information on the underlying performance. The headline result is used for internal performance management, calculating the value of subsidiary convertible shares and minority interest put options. 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 deferred and contingent consideration and other acquisition related charges 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 (whether accounted under IFRS2 or IRS39).
|
Six months to |
|
|
|
Amortisation £000 |
|
Fair value adjustments to minority put option liabilities |
|
Headline £000 |
|
Revenue |
|
82,616 |
|
- |
|
- |
|
82,616 |
|
Operating profit |
|
7,636 |
|
370 |
|
- |
|
8,006 |
|
Share of results of associates & JV |
|
573 |
|
- |
|
- |
|
573 |
|
Finance income |
|
5,386 |
|
- |
|
(5,270) |
|
116 |
|
Finance cost |
|
(193) |
|
- |
|
- |
|
(193) |
|
Profit before taxation |
|
13,402 |
|
370 |
|
(5,270) |
|
8,502 |
|
Taxation |
|
(2,331) |
|
(78) |
|
- |
|
(2,409) |
|
Profit for the year |
|
11,071 |
|
292 |
|
(5,270) |
|
6,093 |
|
Non controlling interests |
(1,006) |
|
- |
|
- |
|
(1,006) |
|
|
Profit attributable to equity holders of the Group |
10,065 |
|
292 |
|
(5,270) |
|
5,087 |
|
|
BASIC EARNINGS PER SHARE |
|
|
|
|
|
|
||
|
Weighted average number of shares (Thousands) |
63,882 |
|
|
|
|
|
63,882 |
|
|
Basic EPS |
|
15.76p |
|
|
|
|
|
7.96p |
|
|
|
|
|
|
|
|
|
|
|
DILUTED EARNINGS PER SHARE |
|
|
|
|
|
|
||
|
Weighted average number of shares (Thousands) as above |
|
63,882 |
|
|
|
|
|
63,882 |
|
Add |
|
|
|
|
|
|
|
|
|
- LTIP |
|
55 |
|
|
|
|
|
55 |
|
- 2012 LTIP |
|
230 |
|
|
|
|
|
230 |
|
- New LTIP |
|
2,322 |
|
|
|
|
|
2,322 |
|
- UK Growth shares |
|
641 |
|
|
|
|
|
641 |
|
- Dilutive put options |
|
472 |
|
|
|
|
|
472 |
|
Total |
|
67,602 |
|
|
|
|
|
67,602 |
|
Diluted earnings per share |
14.89p |
|
|
|
|
|
7.52p |
|
|
Year ended |
|
|
Amortisation £000 |
Acquisition of remaining shares in loss making associate £000 |
Impairment of Goodwill |
Contingent acquisition cost classified as expense |
Fair value adjustments to minority put option liabilities |
Headline £000 |
|
Revenue |
|
169,373 |
- |
- |
- |
- |
- |
169,373 |
|
Operating profit |
|
5,653 |
1,445 |
813 |
5,649** |
2,465 |
- |
16,025 |
|
Share of results of associates & JV |
|
1,350 |
- |
- |
- |
- |
- |
1,350 |
|
Finance income |
|
316 |
- |
- |
- |
- |
- |
316 |
|
Finance cost |
|
(1,087) |
- |
- |
- |
- |
539 |
(548) |
|
Profit before taxation |
|
6,232 |
1,445 |
813 |
5,649 |
2,465 |
539 |
17,143 |
|
Taxation |
|
(4,293) |
(391) |
- |
- |
- |
- |
(4,684) |
|
Profit for the year |
|
1,939 |
1,054 |
813 |
5,649 |
2,465 |
539 |
12,459 |
|
Non controlling interests |
(2,094) |
- |
- |
- |
- |
- |
(2,094) |
|
|
(Loss) / profit attributable to equity holders of the Group |
(155) |
1,054 |
813 |
5,649 |
2,465 |
539 |
10,365 |
|
|
BASIC EARNINGS PER SHARE |
|
|
|
|
|
|
||
|
Weighted average number of shares (Thousands) |
65,285 |
|
|
|
|
|
65,285 |
|
|
Basic EPS |
|
(0.24)p |
|
|
|
|
|
15.88p |
|
|
|
|
|
|
|
|
|
|
|
DILUTED EARNINGS PER SHARE |
|
|
|
|
|
|
||
|
Weighted average number of shares (Thousands) as above |
|
65,285 |
|
|
|
|
|
65,285 |
|
Add |
|
|
|
|
|
|
|
|
|
- LTIP |
|
55 |
|
|
|
|
|
55 |
|
- 2012 LTIP |
|
230 |
|
|
|
|
|
230 |
|
- New LTIP |
|
2,772 |
|
|
|
|
|
2,772 |
|
Total |
|
68,342 |
|
|
|
|
|
68,342 |
|
Diluted earnings per share*** |
(0.24)p |
|
|
|
|
|
15.17p |
|
**Of the £5,649k, £76k relates to a loss on disposal of an Indian subsidiary and £5,573k relates to impairment of goodwill.
*** There is no dilutive effect of losses
5. SEGMENTAL INFORMATION
This segmental information is reconciled to the statutory results in Note 4.
|
Six months to |
|
UK £000 |
Europe £000 |
Middle East and Africa |
Asia and Australasia £000 |
Americas £000 |
Total £000 |
|
|
Revenue |
|
41,111 |
10,427 |
4,076 |
21,930 |
10,024 |
87,568 |
|
|
Operating profit excluding Group costs |
|
5,837 |
1,327 |
278 |
2,621 |
1,731 |
11,794 |
|
|
Group costs |
|
(2,281) |
(36) |
- |
(161) |
(21) |
(2,499) |
|
|
Operating profit |
|
3,556 |
1,291 |
278 |
2,460 |
1,710 |
9,295 |
|
|
Share of results of associates |
|
347 |
(6) |
- |
78 |
122 |
541 |
|
|
Financial income and cost |
|
(267) |
(23) |
(2) |
47 |
19 |
(226) |
|
|
Profit before taxation |
|
3,636 |
1,262 |
276 |
2,585 |
1,851 |
9,610 |
|
|
Taxation |
|
(500) |
(387) |
(47) |
(779) |
(320) |
(2,033) |
|
|
Profit for the period |
|
3,136 |
875 |
229 |
1,806 |
1,531 |
7,577 |
|
|
Non controlling interests |
|
(538) |
(185) |
(82) |
(235) |
(207) |
(1,247) |
|
|
Profit attributable to equity shareholders |
|
2,598 |
690 |
147 |
1,571 |
1,324 |
6,330 |
|
|
HEADLINE BASIC EPS |
|
|
|
|
|
|
8.96p |
|
|
Non cash costs included in operating profit: |
|
|
|
|
|
|||
|
Depreciation & Amortisation of software |
|
(653) |
(119) |
(94) |
(131) |
(123) |
(1,119) |
|
|
Share option charges |
|
(30) |
- |
- |
- |
- |
(30) |
|
|
OFFICE LOCATION |
|
London |
Paris Berlin Madrid Geneva Milan Stockholm |
Abu Dhabi Beirut Cape Town Johannesburg Tel Aviv |
Sydney Melbourne New Delhi Kuala Lumpur Hong Kong Beijing Shanghai Tokyo Singapore |
Los Angeles São Paulo New York San Francisco |
|
|
|
Six months to |
|
UK £000 |
Europe £000 |
Middle East and Africa |
Asia and Australasia £000 |
Americas £000 |
Total £000 |
|
|
Revenue |
|
37,821 |
10,372 |
3,934 |
22,134 |
8,355 |
82,616 |
|
|
Operating profit excluding Group costs |
|
5,566 |
1,231 |
473 |
2,541 |
647 |
10,458 |
|
|
Group costs |
|
(2,235) |
(36) |
- |
(165) |
(16) |
(2,452) |
|
|
Operating profit |
|
3,331 |
1,195 |
473 |
2,376 |
631 |
8,006 |
|
|
Share of results of associates |
|
430 |
(17) |
- |
160 |
- |
573 |
|
|
Financial income and cost |
|
(67) |
(24) |
9 |
19 |
(14) |
(77) |
|
|
Profit before taxation |
|
3,694 |
1,154 |
482 |
2,555 |
617 |
8,502 |
|
|
Taxation |
|
(879) |
(355) |
(124) |
(813) |
(238) |
(2,409) |
|
|
Profit for the period |
|
2,815 |
799 |
358 |
1,742 |
379 |
6,093 |
|
|
Non controlling interests |
|
(475) |
(211) |
(173) |
(437) |
290 |
(1,006) |
|
|
Profit attributable to equity shareholders |
|
2,340 |
588 |
185 |
1,305 |
669 |
5,087 |
|
|
HEADLINE BASIC EPS |
|
|
|
|
|
|
7.96p |
|
|
Non cash costs included in operating profit: |
|
|
|
|
|
|||
|
Depreciation & Amortisation of software |
|
(676) |
(136) |
(98) |
(176) |
(38) |
(1,124) |
|
|
Share option charges |
|
(177) |
- |
- |
- |
- |
(177) |
|
|
OFFICE LOCATION |
|
London |
Paris Berlin Madrid Geneva Milan Stockholm |
Abu Dhabi Beirut Cape Town Johannesburg
|
Sydney Melbourne New Delhi Kuala Lumpur Hong Kong Beijing Shanghai Tokyo Singapore |
Los Angeles São Paulo New York San Francisco |
|
|
|
Year ended |
|
UK £000 |
Europe £000 |
Middle East and Africa |
Asia and Australasia £000 |
Americas £000 |
Total £000 |
|
|
Revenue |
|
79,144 |
21,092 |
8,004 |
44,173 |
16,960 |
169,373 |
|
|
Operating profit excluding Group costs |
|
11,757 |
2,892 |
1,027 |
5,064 |
445 |
21,185 |
|
|
Group costs |
|
(4,710) |
(72) |
- |
(331) |
(47) |
(5,160) |
|
|
Operating profit |
|
7,047 |
2,820 |
1,027 |
4,733 |
398 |
16,025 |
|
|
Share of results of associates |
|
1,074 |
(19) |
- |
224 |
71 |
1,350 |
|
|
Financial income and cost |
|
(146) |
(54) |
(11) |
58 |
(79) |
(232) |
|
|
Profit before taxation |
|
7,975 |
2,747 |
1,016 |
5,015 |
390 |
17,143 |
|
|
Taxation |
|
(1,593) |
(954) |
(271) |
(1,652) |
(214) |
(4,684) |
|
|
Profit for the year |
|
6,382 |
1,793 |
745 |
3,363 |
176 |
12,459 |
|
|
Non controlling interests |
|
(1,276) |
(406) |
(354) |
(533) |
475 |
(2,094) |
|
|
Profit attributable to equity shareholders |
|
5,106 |
1,387 |
391 |
2,830 |
651 |
10,365 |
|
|
HEADLINE BASIC EPS |
|
|
|
|
|
|
15.88p |
|
|
Non cash costs included in operating profit: |
|
|
|
|
|
|||
|
Depreciation & Amortisation of software |
|
(1,128) |
(286) |
(210) |
(297) |
(254) |
(2,175) |
|
|
Share option charges |
|
(200) |
- |
- |
- |
- |
(200) |
|
|
OFFICE LOCATION |
|
London |
Paris Berlin Madrid Geneva Milan Stockholm |
Abu Dhabi Beirut Cape Town Johannesburg
|
Sydney Melbourne New Delhi Kuala Lumpur Hong Kong Beijing Shanghai Tokyo Singapore |
Los Angeles São Paulo New York San Francisco |
|
|
6. FINANCE INCOME
|
|
|
Six months |
|
|
|
Six months |
|
Year |
|
|
|
£000 |
|
|
|
£000 |
|
£000 |
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
Bank interest receivable |
|
98 |
|
|
|
99 |
|
256 |
|
Other interest receivable |
|
56 |
|
|
|
17 |
|
60 |
|
Total finance income |
|
154 |
|
|
|
116 |
|
316 |
|
Fair value adjustments to minority shareholder put option liabilities |
|
- |
|
|
|
5,270 |
|
- |
|
Total |
|
154 |
|
|
|
5,386 |
|
316 |
7. FINANCE COSTS
|
|
|
Six months |
|
|
|
Six months |
|
Year |
|
|
|
£000 |
|
|
|
£000 |
|
£000 |
|
Finance costs |
||||||||
|
|
|
|
|
|
|
|
|
|
|
Bank interest payable |
|
(366) |
|
|
|
(189) |
|
(541) |
|
Other interest payable |
|
(14) |
|
|
|
(4) |
|
(7) |
|
Total interest payable |
|
(380) |
|
|
|
(193) |
|
(548) |
|
|
|
|
|
|
|
|
|
|
|
Fair value adjustments to minority shareholder put option liabilities |
|
(238) |
|
|
|
- |
|
(539) |
|
Total |
|
(618) |
|
|
|
(193) |
|
(1,087) |
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 2015 is 21.2% (30 June 2014: 28.3%). The decrease in the headline tax rate is due to reduced losses in subsidiaries that we were investing in, and the reduced UK tax rate.
The estimated effective annual tax rate for the period to 30 June 2015 is 17.4% (30 June 2014: 132.1%). 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 |
|
|
|
Six months |
|
Year |
|
|
|
£000 |
|
|
|
£000 |
|
£000 |
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
2013 final dividend 4.24p (2012: 3.85p) |
|
- |
|
|
|
- |
|
2,723 |
|
2014 interim dividend 1.40p (2013: 1.21p) |
|
- |
|
|
|
- |
|
947 |
|
|
|
|
|
|
|
|
|
|
|
|
|
- |
|
|
|
- |
|
3,670 |
The directors propose an interim dividend of 1.61p per share (2014: 1.40p per share) payable on
13 November 2015 to shareholders who are on the register at 30 October 2015. This interim dividend, amounting to £1,158k (2014: £947k) has not been recognised as a liability in this half-yearly financial report.
10. CASH CONSUMED BY ACQUISITIONS
|
|
|
|
Six months |
|
|
|
Six months |
|
Year |
|
|
|
|
£000 |
|
|
|
£000 |
|
£000 |
|
Acquisitions |
|
|
|
|
|
|
|
|
|
|
Initial cash consideration paid |
|
|
(577) |
|
|
|
(1,232) |
|
(2,284) |
|
Cash and cash equivalents acquired |
|
|
13 |
|
|
|
(142) |
|
83 |
|
Cash lost on nominal value disposal |
|
|
- |
|
|
|
- |
|
(43) |
|
|
|
|
(564) |
|
|
|
(1,374) |
|
(2,244) |
|
Purchase of associates |
|
|
(3,349) |
|
|
|
- |
|
(5,084) |
|
|
|
|
(3,914) |
|
|
|
(1,374) |
|
(7,328) |
|
|
|
|
|
|
|
|
|
|
|
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR SSMFEUFISESU