RNS Number : 4183N

M&C Saatchi PLC

24 September 2019

 

M&C SAATCHI PLC

 

 

INTERIM RESULTS

 

 

SIX MONTHS ENDED

30 JUNE 2019

 

 

 

24 September 2019

 

 

 

M&C SAATCHI PLC

Interim results for the six months

ended 30 June 2019

 

24 September 2019

 

Statutory - 30 June

 

Headline - 30 June

£'m

2019

2018 Restated

 

2018

 

2019

2018 Restated

 

2018

Billings

280.7

289.2

-3.0%

289.2

 

280.7

289.2

-3.0%

289.2

Revenue

214.2

212.8

0.7%

215.4

 

214.2

212.8

0.7%

215.4

Net Revenue

117.9

123.0

-4.1%

127.2

 

117.9

123.0

-4.1%

127.2

Operating profit

0.3

4.9

-93.0%

11.3

 

4.8

9.4

-48.9%

15.8

Profit before taxation

9.4

5.0

87.7%

11.4

 

3.4

10.3

-66.9%

16.7

Profit for the period

9.0

2.9

208.8%

7.6

 

2.5

7.7

-67.4%

12.8

Earnings

8.5

1.5

460.5%

6.2

 

1.1

5.6

-80.0%

10.7

EPS

9.59p

1.84p

421.2%

7.6p

 

1.26p

6.80p

-81.5%

13.0p

Interim dividend

2.45p

2.45p

maintained

2.45p

 

 

 

 

 

Operating profit margin

0.2%

2.3%

-2.1pts

5.25%

 

2.2%

4.4%

-2.2pts

7.3%

Tax rate

3.8%

41.5%

-37.7pts

30.40%

 

26.4%

25.2%

+1.2pts

23.2%

See note on next page for definition of headline.

2018 Restated. See note 4 for details of the restatement, as well as comments below.

 

Highlights

·      Increase in Statutory profit due to £11.6m profit on disposal of remaining 24.9% share in Walker Media Ltd for £25m in February 2019

·      As previously communicated, year-on-year decline in Headline revenue and profits due to larger number of loss-making entities, particularly start-ups, and the impact of the timing of revenues in 2019 which are expected to fall into the second half

·      Independent accounting review by PwC ongoing, expected to conclude by November 2019. The Board expects this to lead to a restatement of 2018 results; H1 2018 results have been restated to reflect misstatements already identified. The specific items result in a net charge of £5.1m

·      Solid balance sheet with net cash of £9.5m (£2.2m net debt at 31st December 2018)

·      Interim dividend maintained at 2.45p 

·      Full year operating profit and profit before tax forecast to be 5%-10% below expectations (before the impact of exceptional items including office refurbishment costs of £1.4m)

·      Full Year earnings and EPS are projected to show a relatively greater decline than operating profits as a result of the changing composition of profits, with a greater share of Group profits currently being made by those companies with a higher proportion of non-controlling interests and operating in higher tax rate jurisdictions

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

 

"Our results in the first half of 2019 have been impacted by the number of new businesses in the Group as well as the weighting of revenues shifting towards the second half of the year.

 

"Whilst this has had a short term impact on our results, we remain confident in and committed to our strategy of winning new business and investing in new, fast-growing businesses. Looking to the second half, our pipeline of new business is strong across the network, and our newest businesses are performing well and expected to start making a meaningful contribution to the Group."

 

For further information please call:

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

David Kershaw

 

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

Tom Murray

 

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

Nick Westlake, Hugo Rubinstein, 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 and acquired intangibles, 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; profit and loss on disposal of associates; revaluation of investment and their related costs and income statement impact of put option accounting (whether accounted under IFRS2 or IFRS 9). See Note 6 for reconciliation between the Group's statutory results and the 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, corporate acquisitions and disposals and incorporate restated 2018 results (see note 4).

 

Operating margin

Operating margin refers to the percentage calculated through dividing operating profit by revenue.

 

Net Cash

Net Cash refers to cash and cash equivalents less external borrowings at the end of the period, exclusive of expected future cash outflows relating to lease agreements.

 

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 2019 compared with the restated unaudited consolidated income statement for the same period in 2018 (see note 4 for details of the restatement). 

 

 

SUMMARY OF RESULTS

 

Factors impacting these results

As stated in the trading update announced on 16th August 2019, two key factors have impacted the Group's results in the first six months of 2019 when compared to the same period in 2018 and prior years.

 

First, M&C Saatchi has continued to invest in new, start-up businesses which we consider will deliver long term growth. That is reflected in the higher proportion of losses from such ventures in H1 19 compared to H1 18, amounting to a negative impact on profit of £2.6m in H1 19 vs H1 18. Ours is a network of best-in-class entrepreneurs motivated to succeed by holding meaningful minority equity holdings in their businesses. In 2019 the fastest growing businesses in the network and those making the greatest contribution to operating profits have larger minority shareholdings than in prior years and also operate in higher tax rate jurisdictions creating a disproportionate drag on earnings and earnings per share when compared to operating profit.

 

Second, the timing of a considerable proportion of revenues committed and expected to be delivered in 2019, including recent client wins and additional projects, is such that operating profit will be much more heavily weighted to the second half of the year. This also reflects a more prudent approach to revenue recognition.

 

Although there were regional changes to net revenues caused by exchange rate movements, at the Group level currency had negligible effect on net revenues.

 

The first six months of 2019 saw revenues increase by 0.7% compared to H1 2018 (restated). The increased cost of sales due to higher production costs recognised in the period has resulted in a £5 million or 4% reduction in net revenue compared to H1 2018 (restated), leading to a £4.6m or 49% decline in operating profit.

Expectations for the second half and full year

We have seen a shift in the timing of revenues in 2019 away from the first half of the year and expect an increased proportion of profits to be made in the second half of the year. Trading in the second half has been solid, with a strong pipeline of client revenues through to the end of the year expected to convert to improved revenues and profits. As a result, we expect like for like full year operating profit to be 5%-10% below full year 2019 expectations. This is before the impact of any exceptional items including office refurbishment costs of £1.4m. With a change in the composition of those companies in the Group contributing to profits, that is those companies with higher minority shareholdings, and which operate in higher tax rate jurisdictions generating a greater share of operating profit, earnings and EPS are expected to fall by a relatively greater margin than operating profit.

 

The largest contribution to Group profits in the remainder of the year is expected to come from the following divisions:

·      Performance - slow start to the year but has since picked up and has been operating on a monthly run rate consistent with its record of last year

·      Australia - heavily skewed towards retail clients with focus on advertising and promotions during the final quarter of the year.

·      SS+K - significant project with Commonwealth Bank in the second half of the year

·      World Services - significant media activities in the second half of the year

·      South Africa - win of Standard Bank with all of this year's revenue in the second half

·      China - move from associate to subsidiary in the second half

 

In addition, and as announced in the Company's 12th August statement, as part of the ongoing assessment of the Group's assets, we have decided to take an exceptional cost of £1.4m in the second half of 2019 in respect of property-related assets arising from the UK office refurbishment which is currently taking place.

 

UK

The UK posted an increase in net revenue of 3% (2019, £43.6million; 2018, £42.3million). Headline operating profit was up 108% (2019, £3.0million, 2018, £1.4million), with headline operating costs increasing 5% (all comparisons are against restated 2018 numbers).

Growth was driven by World Services and the Talent Group, which has benefited from the acquisition of Red Hare and Grey Whippet on 29 June 2018, have traded strongly. M&C Saatchi S&E continues to trade well, winning Heineken, Beko & Ovo Energy.

The UK Group businesses have strengthened compared to H1 2018 and continues to do so winning a New Home Office contract, LNER, Alpro, Vodafone, Revolution Beauty, OPPO, Durasein, Olympia London, McCormick, Trinity College, Cetaphil, Forex.com, Expedia, the Football Association, Foxtons, GambleAware, Heineken, Legal & General, Powerade and Twinings.

Our Talent agencies signed up John Amaechi (OBE), as well as having three contestants performing in Strictly 2019 (Alex Scott (MBE), James Cracknell (OBE) and Saffron Barker) along with other projects.

Performance media spending slowed in H1 during a period of contract renewals. They have however since resumed at 2018 levels.

 

We made significant investment in start-ups, including in excess of £1million in Send Me A Sample in the first half of the year.

Europe

Like for like net revenues in Europe declined by 16% (2019, £14.2million ; 2018, £17.1million). Headline operating profit was down 84% (2019, £0.4million; 2018, £2.6million), with headline operating costs reducing 5% (all comparisons are against restated 2018 numbers).

 

France had a poor first half with the loss of La Banque Postale and Mini contributing heavily to reduced performance in Europe. However, the office continued to win business which will translate to much improved second half trading, winning work with Compté, Picard, LVMH, Celio, Lansay, IZI by EF, GERLINEA, Focal, Le Bourget and Ipsos.

 

Spain and Sweden had a slow start to the year, but stronger H2 results are expected, particularly in Sweden which is becoming a regional hub winning Adidas Euro 2020 (Sweden), Reebok (Norway, Sweden and Denmark), KLM (Norway, Sweden, Denmark and Finland) and Zound Industries (Sweden).

 

Italy continues to trade strongly with wins including Delonghi and fashion retailers OVS.

 

Germany had a number of new clients including ING (Banking), Falke (Socks), Vattenfall (Energy) and Uniqfeel (Sports Apparel).

 

Middle East and Africa

Like for like net revenue in the Middle East and Africa was down 4% (2019, £7.5million; 2018, £7.8million). Headline operating profit was down 85% (2019, £0.1million; 2018, £0.5million), with headline operating costs reducing 2% (all comparisons are against restated 2018 numbers).

 

The South African business had client losses of Nedbank and SARB impacting H1 2019. This has been countered by winning Standard Bank in the first half, with the work starting in the second half and will be that office's largest ever client.

 

 

 

Asia and Australia

In Asia and Australia, like for like net revenues have increased by 1% (2019, £32.8million; 2018, £32.6million). Headline operating profit was down 48% (2019, £2.3million; 2018, £4.6million), with headline operating costs increasing 6% (all comparisons are against restated 2018 numbers).

 

Start up investments in Jakarta, Hong Kong and Singapore resulted in H1 losses of £0.8m. This is expected to turn around in H2.

 

Non-recurring income in Australia for H1 2018 has resulted in lower comparative profits in H1 2019. Spend in H2 2019 is expected to increase due to the strong retail-driven client base (Woolworths, Optus, Lexus, Cricket Australia and Tab).

 

Clients won in 2019 by the Australian group include AHC (Division of Unilever), SUMO Power, FlexiGroup, Uniting (NSW ACT), Sony Music, AVEO Group, Respiri, Racing Victoria, Plush, Yourtown, Ethos Urban, UNSW, Bill Care and SMEG.

 

 

 

Americas

Like for like net revenues have decreased by 14% (2019, £19.9million; 2018, £23.1million). Headline operating profit was down 50% (2019, £1.3million; 2018, £2.7million), with headline operating costs reducing 5% (all comparisons are against restated 2018 numbers).

 

The Los Angeles office had a poor first half. The office has experienced client reductions, including Epson and Fox Restaurant Concepts, materially impacting our results. Subsequently however the office has won projects for Amazon Music and Origin Hotel.

 

Performance media spending slowed in H1 during a period of contract renewals. They have however since resumed at 2018 levels.

 

Investment in start-ups in Mexico & NY (LIDA) has further impacted H1 2019 results.

 

SS+K continues to trade in line with 2018, with the Commonwealth Bank project generating revenue in H2 2019.

 

Notable client wins for the region in 2019 which will beneficially impact H2 include Locktons, VIZIO + Apple and Copperstate Farms.

 

Balance sheet and cash

Net cash at the half-year was £9.5m, which compares with £2.5m of net debt at 2018 year end and £4.5m net cash at the same stage last year. Working capital outflows during the first half year were £3.8 million which compares to a £11.8 million working capital outflow in the 12 months of 2018 (restated). The disposal of Walker Media Ltd generated £23.2m of cash in the first half and this has been absorbed in repaying bank loans and in investing activities. 

 

Opening reserves have been reduced by £6.5m due to the adoption of IFRS16 Leases. This accounting charge will reverse over the life of the leases (see note 5). Initial findings from the ongoing independent accounting review lead us to conclude a restatement of prior year results is necessary, reducing opening reserves by £5.1m (see note 4)

 

 

 

Accounting review

The Group announced in August that we would be taking an exceptional charge of £6.4 million to the Group's 2019 results as result of an internal review of specific subsidiaries in the UK (this comprised of £4.9m of specifically identified items and a contingency of £1.5 million for further items that may subsequently be identified). We have since engaged PwC to conduct an independent accounting review of the whole Group which is expected to be completed by November 2019. Initial indications are that this review will result in the restatement of prior year results (rather than an exceptional charge in 2019). Further analysis has been undertaken and the specific issues identified relate to:

·      Overstated accrued income: £2.6m

·      Irrecoverable receivables: £1.7m

·      Prepayments: £0.9m

·      Other debtors: £0.5m

·      Impairment of intangible assets: £0.7m

·      The above items to be offset by corporation tax receivable: £1.2m

 

Further detail is included in Note 4 and we will make a further announcement to the market once the findings are confirmed.

 

Since these issues came to light, our recently appointed Group Finance Director, Mickey Kalifa, has appointed a new Finance Director for the UK division and is in the process of hiring additional senior finance staff.

 

Note

Six months ended 30 June 2019

 

Six months ended 30 June 2018#

 

Year ended 31 December 2018#

 

 

 

£000

 

 

£000

 

 

£000

Billings

 

 

280,667

 

 

289,219

 

 

609,610

Revenue

 

 

214,221

 

 

212,835

 

 

419,844

Third party cost of sales

 

(96,304)

 

 

(89,876)

 

 

(168,710)

 

Overheads

 

(26,988)

 

 

(29,218)

 

 

(59,814)

 

Operating charges

 

(123,292)

(123,292)

 

(119,094)

(119,094)

 

(228,524)

(228,524)

Staff costs

 

 

(90,959)

 

 

(89,269)

 

 

(182,536)

Other gains

 

 

371

 

 

400

 

 

1,584

Operating profit

 

 

341

 

 

4,872

 

 

10,368

Share of results of associates and joint ventures

 

 

(115)

 

 

1,264

 

 

2,825

Gain on disposal of associate

11

 

11,617

 

 

-

 

 

-

Finance income

8

 

200

 

 

182

 

 

273

Finance costs

8

 

(2,693)

 

 

(1,337)

 

 

(2,268)

Profit before taxation

 

 

9,350

 

 

4,981

 

 

11,198

Taxation

 

 

(354)

 

 

(2,068)

 

 

(5,362)

Profit for the period

 

 

8,996

 

 

2,913

 

 

5,836

Attributable to:

 

 

 

 

 

 

 

 

 

Equity shareholders of the Group

 

 

8,509

 

 

1,518

 

 

3,128

Non-controlling interests

 

 

487

 

 

1,395

 

 

2,708

Profit for the period

 

 

8,996

 

 

2,913

 

 

5,836

Earnings per share

 

 

 

 

 

 

 

 

 

Basic (pence)

6

 

9.59p

 

 

1.84p

 

 

3.71p

Diluted (pence)

6

 

9.13p

 

 

1.71p

 

 

3.47p

 

 

 

 

 

 

 

 

 

 

Headline results

 

 

 

 

 

 

 

 

 

Revenue

 

 

214,221

 

 

212,835

 

 

419,844

Third party cost of sales

 

 

(96,304)

 

 

(89,876)

 

 

(168,710)

Net revenue

 

 

117,917

 

 

122,959

 

 

251,134

Operating profit

6

 

4,806

 

 

9,412

 

 

23,927

Profit before tax

6

 

3,406

 

 

10,289

 

 

25,897

Profit after tax attributable to equity shareholders of the Group

6

 

1,118

 

 

5,600

 

 

15,969

Basic earnings per share (pence)

6

 

1.26p

 

 

6.80p

 

 

18.93p

Diluted earnings per share (pence)

6

 

1.20p

 

 

6.29p

 

 

17.69p

 

# restated (note 4)

 

 

 

 

Six months ended 30 June 2019

 

Six months ended 30 June 2018#

 

Year ended 31 December 2018#

 

 

 

 

£000

 

£000

 

£000

Profit for the period

 

 

 

8,996

 

2,913

 

5,836

Other comprehensive income*

 

 

 

 

 

 

 

 

Exchange differences on translating foreign operations before tax

 

 

 

(841)

 

(64)

 

1,000

Other comprehensive income for the period net of tax

 

 

 

(841)

 

(64)

 

1,000

 

 

 

 

 

 

 

 

 

Total comprehensive income for the period

 

 

 

8,155

 

2,849

 

6,836

Total comprehensive income attributable to:

 

 

 

 

 

 

 

 

Equity shareholders of the Group

 

 

 

7,668

 

1,454

 

4,128

Non-controlling interests

 

 

 

487

 

1,395

 

2,708

Total comprehensive income for the period

 

 

 

8,155

 

2,849

 

6,836

 

# restated (note 4)

*All items in the consolidated statement of comprehensive income will be reclassified to the income statement

 

 

 

 

Six months ended 30 June 2019

 

Six months ended 30 June 2018#

 

Year ended 31 December 2018#

 

 

Note

 

£000

 

£000

 

£000

Non-current assets

 

 

 

 

 

 

 

 

Intangible assets

 

 

 

47,867

 

50,813

 

49,124

Investments in associates and JV

 

 

 

7,940

 

20,781

 

9,483

Plant and equipment

 

 

 

12,470

 

11,663

 

13,274

Right-of-use assets

 

 

 

30,614

 

-

 

-

Other non-current assets

 

 

 

6,749

 

3,747

 

4,248

Deferred tax assets

 

 

 

7,830

 

5,369

 

5,687

Financial assets at fair value through profit or loss

 

 

 

13,469

 

9,486

 

12,958

 

 

 

 

126,939

 

101,859

 

94,774

Current assets

 

 

 

 

 

 

 

 

Trade and other receivables

 

 

 

128,174

 

138,506

 

145,197

Current tax assets

 

 

 

4,718

 

6,217

 

2,241

Cash and cash equivalents

 

 

 

50,438

 

36,267

 

50,065

Non-current assets classified as Held-for-sale

 

 

11

-

 

-

 

13,106

 

 

 

 

183,330

 

180,990

 

210,609

Current liabilities

 

 

 

 

 

 

 

 

Trade and other payables

 

 

 

(120,809)

 

(136,016)

 

(142,627)

Current tax liabilities

 

 

 

(746)

 

(6,671)

 

(3,318)

Borrowings

 

 

 

(17,636)

 

(3,666)

 

(14,060)

Lease liabilities

 

 

 

(10,658)

 

-

 

-

Deferred and contingent consideration

 

 

 

(675)

 

(348)

 

(752)

Minority shareholder put option liabilities

 

 

 

(22,120)

 

(12,593)

 

(12,327)

 

 

 

 

(172,644)

 

(159,294)

 

(173,084)

Net current assets

 

 

 

10,686

 

21,696

 

37,525

Total assets less current liabilities

 

 

 

137,625

 

123,555

 

132,299

Non-current liabilities

 

 

 

 

 

 

 

 

Deferred tax liabilities

 

 

 

(1,560)

 

(861)

 

(1,444)

Borrowings

 

 

 

(23,291)

 

(28,767)

 

(38,541)

Lease liabilities

 

 

 

(30,271)

 

-

 

-

Contingent consideration

 

 

 

(411)

 

(765)

 

(514)

Minority shareholder put option liabilities

 

 

 

(3,773)

 

(7,363)

 

(6,063)

Other non-current liabilities

 

 

 

(1,784)

 

(2,613)

 

(1,944)

 

 

 

 

(61,090)

 

(40,369)

 

(48,506)

Total net assets

 

 

 

76,535

 

83,186

 

83,793

 

 

 

 

 

 

 

 

 

 

# restated (note 4)

 

 

 

Six months ended 30 June 2019

 

Six months ended 30 June 2018#

 

Year ended 31 December 2018#

 

 

 

£000

 

£000

 

£000

Equity

 

 

 

 

 

 

 

Share capital

 

 

906

 

866

 

876

Share premium

 

 

46,667

 

44,770

 

46,667

Merger reserve

 

 

31,592

 

31,592

 

31,592

Treasury reserve

 

 

(560)

 

(792)

 

(792)

Minority interest put option reserve

 

 

(19,240)

 

(13,935)

 

(12,954)

Non-controlling interest acquired

 

 

(22,463)

 

(21,317)

 

(22,464)

Foreign exchange reserve

 

 

3,752

 

3,529

 

4,593

Retained earnings

 

 

30,568

 

32,265

 

29,068

Equity attributable to shareholders of the Group

 

 

71,222

 

76,978

 

76,586

Non-controlling interest

 

 

5,313

 

6,208

 

7,207

Total equity

 

 

76,535

 

83,186

 

83,793

# restated (note 4)

 

 

Share capital

Share premium

Merger reserve

Treasury reserve

MI put option reserve

Non-controlling interest acquired

Foreign exchange reserves

Retained earnings

Subtotal

Non-controlling interest in equity

Total

 

 

£000

£000

£000

£000

£000

£000

£000

£000

£000

£000

£000

At 31 December 2018

 

876

46,667

31,592

(792)

(12,954)

(22,464)

4,593

29,068#

76,586

7,207

83,793

Adjustment on initial application of IFRS 16

 

-

-

-

-

-

-

-

(6,030)

(6,030)

(531)

(6,561)

Adjusted balance at 1 January 2019

 

876

46,667

31,592

(792)

(12,954)

(22,464)

4,593

23,038

70,556

6,676

77,232

Acquisitions

 

-

-

-

-

-

-

-

-

0

0

0

Acquisitions of minority interest

 

-

-

-

-

(6,288)

-

-

-

(6,288)

0

(6,288)

Exercise of put options

 

30

-

-

232

-

-

-

(2,991)

(2,729)

0

(2,729)

Exchange rate movements

 

-

-

-

-

2

1

-

-

3

5

8

Deferred consideration

 

-

-

-

-

-

-

-

-

0

0

0

Issue of shares to minorities

 

-

-

-

-

-

-

-

-

0

(66)

(66)

Share option charge

 

-

-

-

-

-

-

-

2,012

2,012

0

2,012

Dividends

 

-

-

-

-

-

-

-

0

0

(1,789)

(1,789)

Total transactions with owners

 

30

0

0

232

(6,286)

1

0

(979)

(7,002)

(1,850)

(8,852)

Total comprehensive income for the period

 

0

0

0

0

0

0

(841)

8,509

7,668

487

8,155

At 30 June 2019

 

906

46,667

31,592

(560)

(19,240)

(22,463)

3,752

30,568

71,222

5,313

76,535

# restated (note 4)

 

 

Share capital

Share premium

Merger reserve

Treasury reserve

MI put option reserve

Non-controlling interest acquired

Foreign exchange reserves

Retained earnings#

Subtotal

Non-controlling interest in equity

Total

 

 

£000

£000

£000

£000

£000

£000

£000

£000

£000

£000

£000

At 31 December 2017

 

813

32,095

31,592

(792)

(13,958)

(21,040)

3,593

25,235

57,538

6,532

64,070

Adjustment on initial application of IFRS 15

 

-

-

-

-

-

-

-

28

28

-

28

Adjustment on initial application of IFRS 9

 

-

-

-

-

-

-

-

2,971

2,971

-

2,971

Adjusted balance at 1 January 2018

 

813

32,095

31,592

(792)

(13,958)

(21,040)

3,593

28,234

60,537

6,532

67,069

Acquisitions

13

17

6,749

-

-

-

(265)

-

-

6,501

71

6,572

Acquisitions of minority interest

 

-

-

-

-

-

-

-

-

-

-

-

Exercise of put options

24

36

5,926

-

-

-

-

-

(21)

5,941

-

5,941

Exchange rate movements

 

-

-

-

-

23

(12)

-

-

11

(25)

(14)

Deferred consideration

 

-

-

-

-

-

-

-

-

-

-

-

Issue of shares to minorities

 

-

-

-

-

-

-

-

-

-

-

-

Share option charge

25

-

-

-

-

-

-

-

2,534

2,534

0

2,534

Dividends

12

-

-

-

-

-

-

-

-

-

(1,765)

(1,765)

Total transactions with owners

 

53

12,675

-

-

23

(277)

-

2,513

14,987

(1,719)

13,268

Total comprehensive income for the period

 

-

-

-

-

-

-

(64)

1,518

1,454

1,395

2,849

At 30 June 2018

 

866

44,770

31,592

(792)

(13,935)

(21,317)

3,529

32,265

76,978

6,208

83,186

# restated (note 4)

 

 

Share capital

Share premium

Merger reserve

Treasury reserve

MI put option reserve

Non-controlling interest acquired

Foreign exchange reserves

Retained earnings#

Subtotal

Non-controlling interest in equity

Total

 

 

£000

£000

£000

£000

£000

£000

£000

£000

£000

£000

£000

At 31 December 2017

 

813

32,095

31,592

(792)

(13,958)

(21,040)

3,593

25,235

57,538

6,532

64,070

Adjustment on initial application of IFRS 15

 

-

-

-

-

-

-

-

28

28

-

28

Adjustment on initial application of IFRS 9

 

-

-

-

-

-

-

-

2,971

2,971

-

2,971

Adjusted balance at 1 January 2018

 

813

32,095

31,592

(792)

(13,958)

(21,040)

3,593

28,234

60,537

6,532

67,069

Acquisitions

 

18

6,484

-

-

-

-

-

-

6,502

-

6,502

Acquisitions of minority interest

 

-

-

-

-

-

(319)

-

-

(319)

-

(319)

Exercise of put options

 

44

7,630

-

-

973

(973)

-

(20)

7,654

-

7,654

Exchange rate movements

 

-

-

-

-

31

(132)

-

-

(101)

24

(77)

Deferred consideration

 

1

458

-

-

-

-

-

-

459

-

459

Issue of shares to minorities

 

-

-

-

-

-

-

-

-

-

551

551

Share option charge

 

-

-

-

-

-

-

-

6,104

6,104

-

6,104

Dividends

 

-

-

-

-

-

-

-

(8,378)

(8,378)

(2,608)

(10,986)

Total transactions with owners

 

63

14,572

-

-

1,004

(1,424)

-

(2,294)

11,921

(2,033)

9,888

Total comprehensive income for the year

 

-

-

-

-

-

-

1,000

3,128

4,128

2,708

6,836

At 31 December 2018

 

876

46,667

31,592

(792)

(12,954)

(22,464)

4,593

29,068

76,586

7,207

83,793

# restated (note 4)

 

 

Six months ended 30 June 2019

 

Six months ended 30 June 2018#

 

Year ended 31 December 2018#

 

Note

£000

 

£000

 

£000

Net revenue

 

117,917

 

122,959

 

251,134

Overheads

 

(26,988)

 

(29,218)

 

(59,814)

Staff costs

 

(90,959)

 

(89,269)

 

(182,536)

Other gains

 

371

 

400

 

1,584

Operating profit

 

341

 

4,872

 

10,368

Adjustments for:

 

 

 

 

 

 

Depreciation of plant and equipment and Right-of-use assets

 

6,609

 

1,705

 

3,558

Loss on sale of plant and equipment

 

11

 

52

 

75

Loss on sale of software intangibles

 

49

 

60

 

9

Decrease / (Increase) in financial assets at FVTPL

 

(371)

 

(400)

 

(1,584)

Impairment and amortisation of acquired intangible assets

 

1,350

 

2,007

 

4,427

Impairment of associate and investments

 

-

 

-

 

674

Impairment of goodwill and other intangibles

 

-

 

-

 

2,195

Amortisation of capitalised software intangible assets

 

168