21 Jul 2008 07:00
Vitesse Media plc
Preliminary Results 2008
Vitesse Media plc (AIM: VIS), the publishing, events and online company,
today announced its unaudited preliminary results for the year ended 31 January 2008.
Financial Highlights:
Revenues up 51% to £4.9m (2007: £3.3m) of which online revenues up 58%
Organic revenue growth of 11.2% to £3.6m (2007: £3.3m)
Gross profit margin increased from 65% to 66%
EBITDA profit £0.02m (2007: loss £0.27m)
Operational Highlights:
Acquisition of What Investment, a leading subscription title for investors, made on last day of previous financial year and now incorporated in trading results
Acquisition of Group's sixth strong brand, which incorporates publishing rights - Information Age magazine, with accompanying website and a range of events
Business XL redesign successfully undertaken in the last quarter of 2007/08
Review of activities for the financial year ended 31 January 2008:
I am delighted to report a much-improved performance for the year including the achievement of the important milestone of delivering a full year EBITDA profit. The improvement has been driven by increasing revenues across the board but primarily as a result of the 58% growth in our online activities, of which 62% was from organic growth.
On 6 February 2007, we acquired What Investment and, on 8 November 2007, Information Age. These two highly-regarded brands have been published for many years but we are confident that we have yet to exploit their full online and event potential.
What Investment had a very good year; the publication's website, whatinvestment.co.uk, was relaunched and is steadily building traffic. It has exceeded all our expectations.
Information Age was only owned by the Group for three months. During this time it was successfully integrated into the Group and we have been able to realise immediate annualised savings of £0.25 million, with further significant savings due to be realised in the 2008/9 financial year.
Enquiries:
Vitesse:
Sara Williams www.vitessemedia.co.uk
Kym Kingwill 020 7250 7010
KBC Peel Hunt - NOMAD and advisor
Daniel Harris or Capel Irwin 020 7418 8900
CHAIRMAN'S STATEMENT
Trading update for the first quarter 2008/9
During the first quarter, two major events were staged. The inaugural Rosenblatt New Energy Awards was launched at the Jumeirah Carlton, an event that was immediately successful both in profits and enjoyment and has already transferred to the Natural History Museum for the 2009 event in order that an increased number of guests can be accommodated. The M & A Awards event enjoyed a strong second year and was transferred to the Hilton Park Lane, London, to provide us with a larger venue. The success of these events meant that we were on budget for the first two months, February and March.
Trading in April has proved to be difficult, in particular advertising sales for What Investment and Information Age. However, subscription numbers for What Investment showed a strong upturn and the redesign of Business XL, which occurred in the last quarter of 2007/08, won many new friends resulting in a good financial performance for advertising in the magazine. The sales team for Business XL is also benefiting from working closely with the sales team for Information Age, thus winning new business.
The year ahead
We have carried out a comprehensive review of our activities following the acquisitions of our fifth and sixth brands last year. We have examined how we can work more efficiently across our titles and platforms and have refocused our efforts, particularly in the area of events.
As a result, in the last quarter of the financial year under review, we commenced the process of driving through substantial changes in the way we work, a process which has continued into the current financial year. Whilst the Company will show a loss at the interim stage, the anticipated annualised cost savings of over £0.5m will have their full impact in the last six months of the current financial year at which time the full benefits of this reassessment will be apparent.
We continue to refresh and invest in all our brands. In June 2008, SmallBusiness.co.uk was relaunched, and GrowthBusiness.co.uk, Information-Age.com and GrowthCompany.co.uk will also be redesigned in the second half of the year. A new design for M & A magazine was unveiled in early July and a new look for What Investment will be finalised in the autumn.
We continue to examine and develop new ideas that will enable us to exploit our intellectual property to the full and are confident that, once the economy returns to a more positive note, the Company will demonstrate strong profit and financial performance.
ESM Williams
Chairman and Chief Executive
| CONSOLIDATED INCOME STATEMENT | |||
| for the period ended 31 January 2008 | |||
| Period ended | Period ended | ||
| 31-Jan | 06-Feb | ||
| 2008 | 2007 | ||
| £ | £ | ||
| Revenue | |||
| Existing operations | 3,629,806 | 3,265,112 | |
| Acquired operations | 1,310,042 | - | |
| ________ | ________ | ||
| Continuing operations | 4,939,848 | 3,265,112 | |
| Cost of sales | (1,660,509) | (1,148,611) | |
| ________ | ________ | ||
| Gross profit | 3,279,339 | 2,116,501 | |
| Administrative expenses | (3,364,969) | (2,447,131) | |
| _______ | ________ | ||
| Operating loss | |||
| Existing operations | (672,071) | (330,630) | |
| Acquired operations | 586,441 | - | |
| _______ | _______ | ||
| Continuing operations | (85,630) | (330,630) | |
| Finance costs | (17,348) | (10,434) | |
| Finance income | 4,900 | 1,436 | |
| ------- | -------- | ||
| Loss before tax | (98,078) | (339,628) | |
| Tax | - | - | |
| ------- | -------- | ||
| Loss for the period | (98,078) | (339,628) | |
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| Attributable to equity holders of the parent | (98,078) | (339,628) | |
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| Earnings per share | |||
| Basic | (0.45p) | (1.95p) | |
| Diluted | (0.45p) | (1.95p) | |
| CONSOLIDATED BALANCE SHEET | ||||
| at 31 January 2008 | ||||
| 31-Jan | 06-Feb | |||
| 2008 | 2007 | |||
| £ | £ | |||
| Non-current assets | ||||
| Goodwill | 1,172,832 | 611,966 | ||
| Other intangible assets | 1,530,327 | 908,487 | ||
| Property, plant and equipment | 208,894 | 190,139 | ||
| Trade and other receivables | 21,139 | 21,139 | ||
| -------- | -------- | |||
| 2,933,192 | 1,731,731 | |||
| -------- | -------- | |||
| Current assets | ||||
| Inventories | 16,996 | - | ||
| Trade and other receivables | 1,247,539 | 620,734 | ||
| Cash and cash equivalents | - | 181,092 | ||
| -------- | -------- | |||
| 1,264,535 | 801,826 | |||
| -------- | -------- | |||
| Total assets | 4,197,727 | 2,533,557 | ||
| ======== | ======== | |||
| Equity | ||||
| Share capital | 2,450,558 | 2,090,891 | ||
| Share premium account | 2,369,491 | 1,844,929 | ||
| Share option reserve | 37,466 | 32,031 | ||
| Other reserves | 103,904 | 103,904 | ||
| Retained earnings | (3,194,301) | (3,096,224) | ||
| ________ | ________ | |||
| TOTAL EQUITY ATTRIBUTABLE TO THE EQUITY HOLDERS | 1,767,118 | 975,531 | ||
| OF THE PARENT COMPANY | ||||
| Non-current liabilities | ||||
| Bank loans | 153,095 | 30,769 | ||
| Obligations under finance leases | 22,498 | 45,663 | ||
| Deferred tax liability | 147,026 | - | ||
| ______ | ______ | |||
| 332,619 | 76,432 | |||
| ______ | ______ | |||
| Current liabilities | ||||
| Trade and other payables | 1,852,324 | 1,407,284 | ||
| Bank overdrafts and loans | 212,079 | 30,770 | ||
| Obligations under finance leases | 43,587 | 43,540 | ||
| ________ | ________ | |||
| 2,107,990 | 1,481,594 | |||
| ________ | ________ | |||
| Total liabilities | 2,430,609 | 1,558,026 | ||
| ________ | ________ | |||
| TOTAL EQUITY AND LIABILITIES | 4,197,727 | 2,533,557 | ||
| ======== | ======== |
| CONSOLIDATED CASH FLOW STATEMENT | |||
| for the period ended 31 January 2008 | |||
| 31-Jan | 06-Feb | ||
| 2008 | 2007 | ||
| £ | £ | ||
| NET CASH USED IN | |||
| OPERATING ACTIVITIES | (304,415) | (541,875) | |
| ------- | ------- | ||
| INVESTING ACTIVITIES | |||
| Interest received | 4,900 | 1,436 | |
| Acquisition of subsidiaries (net of cash acquired) | (678,289) | (35,936) | |
| Purchases of property, plant and equipment | (132,793) | (69,943) | |
| Purchases of intangible assets | - | (625,807) | |
| ______ | ______ | ||
| NET CASH USED IN INVESTING ACTIVITIES | (806,182) | (730,250) | |
| ______ | ______ | ||
| FINANCING ACTIVITIES | |||
| Proceeds from issue of share capital | 751,539 | 1,057,501 | |
| Share issue costs | (80,860) | (49,868) | |
| Repayments of borrowings | (44,341) | - | |
| Repayment of obligations under finance leases | (44,809) | (19,868) | |
| New bank loans raised | 250,000 | - | |
| ------ | ------ | ||
| NET CASH FROM FINANCING ACTIVITIES | 831,529 | 987,765 | |
| ______ | ______ | ||
| NET DECREASE IN CASH AND CASH | (279,068) | (248,360) | |
| EQUIVALENTS | |||
| CASH AND CASH EQUIVALENTS AT | |||
| BEGINNING OF PERIOD | 181,092 | 465,452 | |
| _______ | _______ | ||
| CASH AND CASH EQUIVALENTS AT END OF PERIOD | (97,976) | 181,092 | |
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Statement of changes in equity ATTRIBUTABLE TO EQUITY SHAREHOLDERS
| Share capital | Share premium | Share-based payment reserve | Other reserves | Retained earnings | Total | |
| £ | £ | £ | £ | £ | £ | |
| As at 1 February 2006 | 1,594,750 | 1,333,437 | 22,019 | 103,904 | (2,756,596) | 297,514 |
| Loss for period | - | - | - | - | (339,628) | (339,628) |
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| 1,594,750 | 1,333,437 | 22,019 | 103,904 | (3,096,224) | (42,114) | |
| Issue of share capital | 496,141 | 561,360 | - | - | - | 1,057,501 |
| Recognition of share-based payments | - | - | 10,012 | - | - | 10,012 |
| Issue costs | - | (49,868) | - | - | - | (49,868) |
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| As at 6 February 2007 | 2,090,891 | 1,844,929 | 32,031 | 103,904 | (3,096,224) | 975,531 |
| Loss for period | - | - | - | - | (98,078) | (98,078) |
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| 2,090,891 | 1,844,929 | 32,031 | 103,904 | (3,194,301) | 877,454 | |
| Issue of share capital | 359,667 | 605,422 | - | - | - | 965,089 |
| Recognition of share-based payments | - | - | 5,435 | - | - | 5,435 |
| Issue costs | - | (80,860) | - | - | - | (80,860) |
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| As at 31 January 2008 | 2,450,558 | 2,369,491 | 37,466 | 103,904 | (3,194,301) | 1,767,118 |
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NOTES
For the year ended 31 January 2008
1. The financial information contained in this document does not constitute statutory accounts within the meaning of section 240 Companies Act 1985. The figures for the year ended 31 January 2008 have been extracted from the annual accounts in respect of which the auditors have not yet signed their audit
report. The audited statutory accounts for the year ended 6 February 2007 have been extracted from the audited statutory accounts for that year which have been filed with the Registrar of Companies and received an unqualified auditors' report which did not contain a statement under section 237(2) or (3) of the Companies Act 1985. Statutory accounts for the year ended 6 February 2007 have been restated
in accordance with International Financial Reporting Standards (IFRS).
2. For all periods up to 6 February 2007 Vitesse Media plc has prepared its financial statements in accordance with UK Generally Accepted Accounting Principles (UK GAAP). AIM Rules require that the annual consolidated financial statements of Vitesse Media plc for the year ended 31 January 2008 be prepared in accordance with International Financial Reporting Standards (IFRS).
Accordingly, these financial statements have been prepared for the first time in accordance with International Financial Reporting Standards and are covered by IFRS1, First-time Adoption of IFRS.
In preparing these financial statements the comparative figures previously reported under UK GAAP have been restated for the transition to IFRS.
3. As required under IFRS 1, the equity reconciliations at 1 January 2006 (the transition date for IFRS) and at 6 February 2007 (date of last UK GAAP financial statements) are set out above in the Statement of changes in equity attributable to equity shareholders of the parent.
The amortisation charged under UK GAAP for the year ended 6 February 2006 was charged in accordance with UK GAAP policies and was also considered necessary to bring the goodwill to an accurate carrying value. Under IFRS goodwill cannot be amortised but an impairment is instead required for the year ended 6 February 2006. The resulting loss for the year ended 6 February 2006 is therefore the same under IFRS as reported in the audited accounts prepared under UK GAAP.
Under IFRS goodwill previously accounted for on the acquisition of investments has been restated as "Other intangible assets" in accordance with IFRS 3 - Business combinations. This reclassification does not affect the figures previously stated. In addition the total assets, equity and liabilities reported under UK GAAP are the same as that reported under IFRS.
4. EARNINGS/LOSS PER SHARE
a) Basic
Basic earnings per share is calculated by dividing the profit attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the period, excluding ordinary shares purchased by the Company and held as treasury shares.
| 2008 £ | 2007 £ | |
| Loss attributable to equity holders of the Company | (98,078) | (339,628) |
| Weighted average number of ordinary shares in issue | 21,812,906 | 17,472,652 |
| Basic and diluted earnings per share (pence per share) | (0.45p) ====== | (1.95p) ====== |
(b) Diluted
Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares. The Company has one category of dilutive potential ordinary shares: share options. Applicable. The Company has made a loss and the potential share options are therefore anti-dilutive.
5. CALLED-UP SHARE CAPITAL
| 2008 £ | 2007 £ | |
|
Authorised: 25,000,000 Ordinary shares of 10p each | 2,500,000 Number of Shares £ | 2,500,000 Share Capital £ |
| Issued and fully paid Ordinary shares of 10p each | ||
| As at 1 February 2006 | 15,947,503 | 1,594,750 |
| Shares issued | 4,961,411 | 496,141 |
| Issue costs | - | - |
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| As at 6 February 2007 | 20,908,914 | 2,090,891 |
| Shares issued | 3,596,663 | 359,667 |
| Issue costs | - | - |
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| As at 31 January 2008 | 24,505,577 | 2,450,558 |
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Shares issued during the period to raise additional financing for the acquisition of Information Age Ltd.
6. This preliminary announcement was approved by the Board on 17th July 2008.
Copies of this announcement are available at the office of the company's nominated adviser, KBC Peel Hunt at the address below.
KBC Peel Hunt, 4th Floor, 111 Broad Street, London EC2N 1PH
or at vitessemedia.co.uk