Ebiquity Regulatory News (EBQ)

25 Jan 2007 07:11

Thomson Intermedia PLC25 January 2007 Thomson Intermedia plc Trading update Thomson Intermedia plc (AIM: THN), the media insight company is providing atrading update, following the year end change. Thomson Intermedia, expects toannounce its second set of interim results for the 12 months ending 31 January2007 in April. The core recurring revenues continue to show healthy growth in line with thehistoric profile of the Group. Alongside the core recurring revenues, ThomsonIntermedia also has a one-off development revenue stream which because of theunpredictability of project timings can have a material impact on Group profits. Thomson Intermedia expects Group revenue to be in the region of £20.6m and EBITof £3.3m for the 15 months to 30 April 2007. Financial Update The enlarged group now has two distinct revenue streams; recurring andconsultancy revenue, and development revenue. Recurring and consultancy revenue This consists primarily of recurring annual services for which the Groupmaintains a high renewal rate and good forward visibility as well as marketingconsultancy revenue. Recognised revenue for this area is expected to be £19.6m for the 15 monthperiod to April 2007 compared to £8.9m for the year to 31 January 2006. On aproforma basis, assuming billets' figures were included for all 12 months; thisoperation's revenues for the year to 31 January 2006 would have been £13.6m. Gross profit is expected to increase to £10.4m for the 15 month period to April2007, against £4.9m for the year to 31 January 2006 (£6.7m on a proforma basis).This represents annualised organic growth of 24% and a four percentage pointimprovement in the gross margin to 53%. With overheads predominately flat, the resulting underlying operating profitfrom recurring and consultancy revenue is expected to increase to £3.5m in the15 month period; up from £1.4m on a proforma basis for the year to 31 January2006. On a like-for-like basis comparing recurring and consultancy revenue asthey were 12 months ago, and adjusted for billetts to 12 months, this corebusiness stream has seen growth in underlying profit of 96%. Development Revenue This is predominately one-off fees, the majority of which directly or indirectlylead to longer term core revenue streams going forward. To 31 January 2006, the Group recognised £2.2m of development income whichincludes £1.1m of retrospective vouching; £0.4m of German licence fees and feesfor the development of publisher platform. Currently the Group has a significant pipeline of new development projects, butthe timing of closure of these projects and the delivery schedules areunpredictable. The Group, however, does expect to close a high proportion ofthese projects during the current calendar year. Development revenue for the 15months to April 07 is currently expected to be the order of £1m. A negativecontribution of £0.2m is expected after accounting for R&D costs and anapportionment of overheads. This is £1.5m less than the proforma 12 months to31 January 2006. Outlook Thomson Intermedia is committed to becoming the key provider of marketing toolswhich help in providing maximum value for companies' advertising expenditure andcore technology tools to the media industry as a whole. The industry remainsthe last 'trust' industry and developing platforms coupled with thefragmentation of media is creating increased demand for Thomson Intermedia'sproducts and services. The Group has built a much stronger position in the market place as a result ofthe integration of the businesses, the enhancement of data sets and products andthe investment in relationships. This has led to a significant pipeline ofdevelopment projects currently under discussion, the conclusion of which willnot only bring immediate revenues but also additional recurring revenue streamsfor the future of the core business. In addition the successful conclusion of the Group M negotiations has resultedin the removal of a major sales barrier for the Group's online services.Although it is still in early stages, in the Board's view, with the introductionof additional dedicated sales resource this will begin to have a positive impactto recurring revenues in the next financial year. The Board is confident that the progress made and platforms being built willcontinue to drive and exploit the Group's significant opportunities. Enquiries: Thomson Intermedia Sarah Jane Thomson, Joint Chief Executive 020 8466 2906 David Trendle, Finance Director College Hill Adrian Duffield/Ben Way 020 7457 2020 This information is provided by RNS The company news service from the London Stock Exchange