Chesterfield Sp Regulatory News (CSC)

30 Mar 2006 07:02

Net b2b2 PLC30 March 2006 Netb2b2 plc Interim results for the six months ended 31 December 2005 Netb2b2 plc ("Netb2b2" or "the Group"), the digital communications businessaggregator, today announces its interim results for the six months ended 31December 2005. Highlights: •Turnover increased by 6% to £3.2 million (2004: £3.0 million) •Strong growth in cScape, the largest Group business •Newly-acquired Fernhart New Media's innovative online racing portal, OneStopRacing.com, live in time for the Grand National •Strategic Review and revised performance targets initiated Commenting on the results, Keith Young, Chairman of Netb2b2 , said: "We continueto make progress and the first three months of trading in 2006 offers furtherencouragement. Netb2b2 now has sufficient positive momentum to accelerate theBoard's aim to deliver shareholder value through greater intra-Group synergiesand earnings enhancing acquisitions." For further information, please contact: Keith Young/Geoffrey Griggs John West/Claire MellyNetb2b2 plc Tavistock CommunicationsTel: 020 7878 1008 Tel: 020 7920 3150 Chairman's statement The Group's performance in the period was encouraging but much remains to beachieved. We are pleased to highlight the performance of our largest division,cScape Strategic Internet Services, and of our latest acquisition, Fernhart NewMedia, both of which continue to win new business, add services and broadentheir client bases. As a Board, we are pleased that the Group is now operating in a much more maturemarket, where digital communications are no longer considered "new media" butare instead an established part of everyone's business and non-working life. With broadband commonplace in homes and offices, and with WiFi networks allowingbusiness to be conducted outside the traditional workplace, the digitalmarketplace is expanding rapidly. Given this, we believe there is an enormousopportunity to be seized and the Board has agreed that the Group must nowaccelerate its activities. To this end, we are initiating a Strategic Review of the Group's entireportfolio of companies to benchmark the added value delivered by each company.We will also re-examine our acquisition strategy in order to produce a broad,high quality pipeline of potential new Group companies. The heads of individual operations that remain part of the Group anticipatetougher new performance targets for the coming year, building on prior yearachievements. Financial results The Group saw an improvement in operating profits (before exceptional item)assisted by a maiden turnover contribution of £232,000 from Fernhart New Media,which we acquired last September. Turnover in the period rose 6% to £3.2million (2004: £3.0 million). The Group broke even before tax and exceptionalitem (2004: loss £5,000). Our cash position at the period end remainssatisfactory at £390,000 (2004: £181,000). We have continued to invest in our Group companies in terms of staffing,technology and administrative systems. We see continued investment as essentialto the Group's goal of achieving greater critical mass in the digital world. The Group's overall financial performance for the year is summarised below: Six Months Six Months Year Ended Ended Ended 31.12.05 31.12.04 30.06.05 Unaudited Unaudited Audited £000's £000's £000's Turnover for Group 3,154 2,956 6,303 ---------- ---------- ---------- Operating profit/(loss) before 6 4 132exceptional itemExceptional item (140) - (18)Net interest paid (6) (9) (19) ---------- ---------- ---------- Group profit/(loss) for the period (140) (5) 95before taxTaxation - - 19 ---------- ---------- ---------- Group profit/(loss) for the period after (140) (5) 114tax ========== ========== ========== As mentioned in our 30 June 2005 accounts, a provision has been made in respectof further contributions claimed by the independent trustee in respect ofpensioners in a defined benefit scheme which has no active members. Consistentwith professional advice received, it is now considered prudent to increase thisprovision and accordingly an exceptional amount of £140,000 has been charged tothese accounts which produces a retained loss of that figure. Although this willhave an impact on the Group's profitability at the year end, it is expected tobe a non-recurring item. Due to the exceptional item referred to above we are reporting a loss per shareof 2.48p (2004: loss 0.10p). Net assets grew to £2.3 million (2004: £1.7million). The directors are not recommending the payment of an interim dividend, but willcontinue to review this on an ongoing basis. During the period the Group had four main areas of activity: internet services(cScape and NetPen), publishing and digital communication services (ITM),specialist hosting (Blue Sky) and media and interactive technology (Fernhart).As can be seen from Note 3 to the accounts, like for like turnover growth wasonce again achieved by cScape and we were pleased with the level of contributionfrom Fernhart which is progressing well since we acquired it in September 2005. Outlook We continue to make progress and the first three months of trading in 2006offers further encouragement. Netb2b2 now has sufficient positive momentum toaccelerate the Board's aim to deliver shareholder value through greaterintra-Group synergies and earnings enhancing acquisitions. Keith Young30 March 2006Chairman GROUP PROFIT AND LOSS ACCOUNT FOR THE SIX MONTHS ENDED 31 DECEMBER 2005 Six Months Six Months Year Ended Ended Ended 31.12.05 31.12.04 30.06.05 Unaudited Unaudited Audited Note £000's £000's £000's TURNOVER 3 3,154 2,956 6,303 Cost of sales (730) (806) (1,846) -------- -------- --------GROSS PROFIT 2,424 2,150 4,457 -------- -------- -------- Administrative expenses pre (2,418) (2,146) (4,325)exceptional itemExceptional Item (140) - (18) -------- -------- -------- Administrative expenses (2,558) (2,146) (4,343) -------- -------- --------OPERATING PROFIT/(LOSS) Pre exceptional item 6 4 132Exceptional item (140) - (18) -------- -------- --------Total operating (loss)/profit 3 (134) 4 114 -------- -------- -------- Interest receivable and similar - 2 -incomeInterest payable and similar (6) (11) (19)charges -------- -------- --------(LOSS)/PROFIT ON ORDINARYACTIVITIES BEFORE TAXATION (140) (5) 95 Tax on (loss)/profit on ordinary 5 - - 19activities -------- -------- --------(LOSS)/PROFIT FOR THE FINANCIAL (140) (5) 114PERIOD ======== ======== ======== (LOSS)/PROFIT PER SHARE (PENCE)Ongoing activities 6 (2.48p) (0.10p) 2.32p ======== ========= ======== GROUP BALANCE SHEET AT 31 DECEMBER 2005 Six Months Six Months Year Ended Ended Ended 31.12.05 31.12.04 30.06.05 Unaudited Unaudited Audited £000's £000's £000's FIXED ASSETSIntangible assets 2,436 1,887 1,887Tangible assets 549 400 416 -------- -------- -------- 2,985 2,287 2,303CURRENT ASSETSStocks 112 79 98Debtors 1,328 1,337 1,231Cash at bank 390 181 571 -------- -------- -------- 1,830 1,597 1,900 CREDITORS: amounts falling duewithin one yearBank loans and overdraft (125) (176) (270)Trade and other creditors (2,413) (2,011) (1,902) -------- -------- -------- (2,538) (2,187) (2,172) NET CURRENT LIABILITIES (708) (590) (272) -------- -------- --------TOTAL ASSETS LESS CURRENT LIABILITIES 2,277 1,697 2,031 ======== ======== ========CAPITAL AND RESERVESCalled up share capital 596 2,873 523Share premium 513 11,035 200Capital redemption reserve 6 - 6Profit and loss account 1,162 (12,211) 1,302 -------- -------- --------EQUITY SHAREHOLDERS' FUNDS 2,277 1,697 2,031 ======== ======== ======== GROUP CASH FLOW STATEMENT FOR THE SIX MONTHS ENDED 31 DECEMBER 2005 Six Months Six Months Year Ended Ended Ended 31.12.05 31.12.04 30.06.05 Note Unaudited Unaudited Audited £000's £000's £000's Net cash inflow/(outflow) from 7 119 (230) 234operating activities Returns on investments and 8 (8) (9) (19)servicing of finance Taxation - - - Capital expenditure 8 (170) (83) (169) Acquisitions 8 (551) - - -------- ------- -------Net cash (outflow)/inflow before (610) (322) 46financing Financing 8 574 (13) (85) -------- ------- -------Decrease in cash in the period (36) (335) (39) ======== ======= =======Reconciliation of net cash flowto movement in net funds Decrease in cash in the period 9 (36) (335) (39) (Increase)/decrease in debt and 9 (186) 13 301lease financing ------- ------- -------Movement in net funds in the 9 (222) (322) 262period Net funds at start of period 9 268 296 6 ------- ------- -------Net funds/(debt) at end of 9 46 (26) 268period ======= ======= ======= NOTES TO THE ACCOUNTS FOR THE SIX MONTHS ENDED 31 DECEMBER 2005 1. FINANCIAL INFORMATION The financial information is for the six months ended 31 December 2005 and isneither audited nor reviewed as defined by APB Bulletin 1999/4. The balancesheet and profit and loss account do not constitute statutory statements withinthe meaning of section 240 Companies Act 1985. The results for the year ended30 June 2005 have been extracted from the financial statements of the Group onwhich an unqualified report from the auditors has been received and which havebeen filed with the Registrar of Companies. 2. BASIS OF PREPERATION The interim financial information has been prepared on the basis of theaccounting policies adopted for the audited accounts for the year ended 30 June2005 under the historical cost convention and in accordance with applicableaccounting standards. 3. SEGMENTAL INFORMATION The Group operates in the UK and the whole of its turnover and profit relate tocontinuing activities and to the UK market. Six months Six months Year Ended Ended Ended 31.12.05 31.12.04 30.06.05 Unaudited Unaudited Audited £000's £000's £000'sTurnoverInternet services 1,707 1,522 3,316 Publishing and digital 874 1,081 2,307communication services Specialist hosting 341 348 671 Media and interactive technology 232 - - Central costs - 5 9 --------- --------- ---------Group 3,154 2,956 6,303 ========= ========= =========Profit before interest and taxInternet services 142 131 331 Publishing and digital 33 20 112communication services Specialist hosting 64 109 204 Media and interactive technology 30 - - Central costs (263) (256) (515) Exceptional costs (140) - (18) --------- --------- ---------Group (134) 4 114 ========= ========= ========= 4. GOODWILL The Board has assessed each subsidiary with reference to its durability, abilityto sustain future long term profitability and assessed ability to maintainmarket position. Based on this assessment the Board is of the opinion that thegoodwill elements have indefinite economic lives. The Board has carried outimpairment reviews on these goodwill elements and has concluded that theircurrent recoverable amounts are in excess of their carrying values. 5. TAXATION No liability to UK corporation tax arose on ordinary activities for the periodowing to trading losses brought forward from previous periods. 6. PROFIT/(LOSS) PER ORDINARY SHARE Basic profit/(loss) per share is calculated by dividing the loss attributable toordinary shareholders by the weighted average number of ordinary shares duringthe year. The diluted profit/(loss) per share is the same as the actual lossper share. Six Months Six Months Year Ended Ended Ended 31.12.05 31.12.04 30.06.05 Unaudited Unaudited Audited £000's £000's £000's Basic earnings attributable to ordinary (140) (5) 114shareholders: ========== ========= ========= Weighted average number of ordinary 5,644,999 4,795,472 4,911,048shares ========== ========= ========== Profit/(loss) per share: (2.48p) (0.10p) 2.32p ========== ========= ========== 7. RECONCILIATION OF OPERATING PROFIT/(LOSS) TO NET CASH OUTFLOW FROMOPERATING ACTIVITIES Six Months Six Months Year Ended Ended Ended 31.12.05 31.12.04 30.06.05 Unaudited Unaudited Audited £000's £000's £000's Operating (loss)/profit (134) 4 114Depreciation charges 38 68 140Increase in stocks (14) - (19)Increase in debtors (95) (232) (126)Increase/(decrease) in creditors 324 (70) 125 -------- -------- --------Net cash inflow/(outflow) from operating 119 (230) 234activities ======== ======== ======== 8. ANALYSIS OF CASH FLOWS Six Months Six Months Year Ended Ended Ended 31.12.05 31.12.04 30.06.05 Unaudited Unaudited Audited £000's £000's £000'sReturns on investments and servicing offinanceInterest received - 2 -Interest paid (6) (10) (13)Interest element of hire purchase (2) (1) (6)payments -------- -------- --------Net cash outflow for returns on investmentsand servicing of finance (8) (9) (19) ======== ======== ========Capital expenditurePurchase of tangible fixed assets (170) (83) (169) -------- -------- --------Net cash outflow for capital expenditure (170) (83) (103) ======== ======== ========AcquisitionsPurchase of goodwill (551) - - -------- -------- --------Net cash outflow for acquisitions (551) - - ======== ======== ========FinancingIssue of ordinary share capital 386 - 250Bank loans (invoice discounting) - - (290)Capital element of hire purchase payments 188 (13) (11)Share buy backs - - (34) -------- -------- --------Net cash inflow/ (outflow) from financing 574 (13) (85) ======== ======== ======== 9. ANALYSIS OF CHANGES IN NET (DEBT)/ FUNDS At 31 December At 1 July 2005 Cash flow 2005 £000's £000's £000'sNet cash:Cash at bank and in hand 571 (181) 390Bank overdrafts (270) 145 (125) -------- -------- ------- 301 (36) 265 -------- -------- -------Debt:Hire purchase agreements (33) (186) (219) -------- -------- -------Total 268 (222) 46 ======== ======== ======= At 31 December At 31 December At 1 July 2005 2004 2005 £000's £000's £000'sAnalysed in balance sheetCash at bank and in hand 390 181 571Bank overdrafts (125) (176) (270)Hire purchase payments due within (219) (31) (33)1 yearHire purchase payments due after - - -1 year ------- ------- ------- 46 (26) 268 ======= ======= ======= 10. COPIES OF THE INTERIM REPORT Copies of the interim report are available from www.netb2b2.com or the CompanySecretary at Netb2b2 Plc, Central House, 142 Central Street, London, EC1V 8AR. This information is provided by RNS The company news service from the London Stock Exchange