Ithaca Energy Regulatory News (ITH)

7 Dec 2007 07:01

ITIS Holdings PLC07 December 2007 ITIS Holdings plc ("ITIS" or the "Company") Acquisition of Trafficlink Limited ("Trafficlink") ITIS, the AIM listed provider of real time traffic information services ispleased to announce today the acquisition of the entire issued share capital ofTrafficlink from Dunedin, the UK mid market private equity house. HIGHLIGHTS • Trafficlink is the UK's leading distributor of traffic incident andtravel information to broadcasters, business and Government, providing over 42million people each week with access to real time journey information across allmodes of transport. • Key customers include the BBC, Highways Agency and through anexclusive agreement with UBC Media, 185 commercial radio stations. • The acquisition enables ITIS to expand its strong presence within theUK market, adding value to existing services and enriching both companies'content offerings to customers. • Initial cash payment of £10.5 million (from existing resources) anddeferred, performance-related cash consideration of up to £6.0 million by June2009. • In the year ended 30th June 2007 Trafficlink reported audited revenueof £4.7million, profit before taxation of £0.56 million and an EBITDA of £0.74million. • The acquisition provides complementary data sources and significantcross-selling opportunities. • Acquisition expected to be immediately earnings enhancing. Nick Somper, Chief Executive of Trafficlink said: "The demand for high quality traffic and travel information has grownsignificantly in recent years from consumers, government and the corporatesector. Our nationwide coverage across all modes of transport provides us with atruly unique position from which to meet this demand. Our close relationshipwith ITIS has been a very real feature of our success and the consolidation ofour data and technologies will enable us to offer unrivalled products andservices to our existing customers and to address the requirements of newmarkets and platforms as they emerge" Stuart Marks, Chief Executive of ITIS, commented: "Acquiring Trafficlink is an important step in our strategy to maintain ourleadership in the UK traffic and travel market by providing drivers with thehighest quality information accessed across the widest range of wireless media.We have worked closely with management at Trafficlink for over five years andbelieve that by consolidating our data formally we will be able to offer a widerrange of products and services, especially in emerging technologies such asdigital radio. The navigation and broadcast industries are evolving rapidly andwe believe that the combination of ITIS' speed and flow data, generated byFloating Vehicle Data, and Trafficlink's unrivalled incident information willprovide a compelling, real time and historical journey dataset." There will be a meeting for investors and invited analysts at Trafficlink's HeadOffice (91 Charterhouse Street, London, EC1M 6HR) at 9.30am on Wednesday 12thDecember. ITIS Holdings plc ("ITIS" or the "Company") Acquisition of Trafficlink Limited ("Trafficlink") Introduction ITIS, a real time road traffic information provider serving the UK andinternational markets, is pleased to announce the acquisition of Trafficlink,the UK's leading provider of journalistic traffic and travel information tobroadcasters, business and Government. Information on Trafficlink Trafficlink is the UK's leading provider of journalistic traffic and travelinformation to broadcasters, business and government, providing over 42 millionpeople each week with access to real-time journey information across all modesof transport. Trafficlink gathers, edits and broadcasts traffic and travel information from anetwork of seven regional offices (London, Bristol, Birmingham, Cardiff,Manchester, Middlesbrough, Edinburgh) that operate 24 hours per day, 7 days aweek. REGIS, Trafficlink's data aggregation tool, covers the entire UK roadnetwork as well as all forms of public transport and aggregates real-timetraffic and travel information from over 5,000 CCTV cameras, police forces,government agencies, local councils and other sources. Trafficlink's data isthen delivered by its customers across multiple platforms that includecommercial radio stations, BBC local and national radio, Ceefax and BBC Online,Teletext, ITV Local, GMTV, Sky News, an expanding range of corporate clients,websites and government agencies. Trafficlink's principal business is the provision of traffic and travel updatesto the BBC (with a recently renewed contract until November 2010) and tocommercial radio stations, the latter via a contract with UBC which extends to2012. Trafficlink, through its own team of travel editors and broadcasters,makes up to 15,000 live broadcasts on behalf of 115 radio stations every week,and provide a further 110 with real-time information for broadcast. Some 57percent of its revenues are derived from the broadcast (radio and TV) market,virtually all through fixed fee arrangements. Trafficlink has developed strategic relationships with its government partnersand provides a range of data and consultancy services to the Highways Agency,including Traffic Radio, a recently launched regionalised traffic informationservice, offering news about traffic conditions on England's motorway and trunkroad network, as well as London's main roads, 24 hours a day, delivered on theinternet and through DAB radio. Trafficlink is also the sole provider ofmulti-modal information to Transport Direct, the Department for Transport'sjourney planning and information website. Increasingly, businesses are recognising the cost of travel congestion anddelays. In order to meet this challenge, Trafficlink has also developedreal-time location specific solutions developed to meet the needs of individualbusinesses. The business employs 130 permanent staff and is run by CEO Nick Somper who alongwith all key management will remain with the business. For the year to 30 June 2007, Trafficlink generated an audited EBITDA of £0.74million and profit before taxation of £0.56 million on revenues of £4.7 million. Trafficlink had tax losses of £10.53 million at 30 June 2007, which can beutilised against future trading profits. Key terms of the Acquisition Under the Acquisition Agreement ITIS has acquired the entire issued sharecapital of Trafficlink and repaid certain loans within Trafficlink for aninitial cash payment of £10.5 million which will be financed out of ITIS'existing cash reserves. There is a deferred performance related payment of upto £6.0m payable by June 2009. Background to and rationale for the Acquisition ITIS has worked closely with Trafficlink for over five years through variousdata sharing initiatives and believes that formally consolidating the twocompanies' data sets will allow the combined group to offer a wider range ofproducts and services, especially in emerging technologies such as digitalradio: • The combination of Trafficlink's traveller information whichidentifies the cause of delays, aggregated with ITIS's FVD capability whichreports the effects of the incident reinforces the demand from customers for theprovision of a wider picture to drivers to enable them to make safe andintelligent decisions for themselves about their journey. • The advent of digital radio, in which the UK is the world leader,removes any distinction between voice and data over wireless, allowing serviceproviders to offer the information in an environment that promotes driver safetythrough ease of delivery. ITIS, through its agreement with 4 Digital Group,intends to capitalise on this distinctive dataset and Trafficlink's team ofnewsreaders to support customers as they migrate to these new platforms. • Whilst the previous arrangements between ITIS and Trafficlink havebeen commercially successful for both parties, ITIS believes that the pace ofdevelopment and new competitive environment makes it the right time to controlthe end to end data quality and business model. • ITIS recognises the Government's commitment to reducing congestion bypromoting multi-modal alternatives to cars. ITIS and Trafficlink combinedalready reach more motorists than any other commercial provider and intend tomake use of in-vehicle and mobile devices to support better journey managementand help government manage their congestion targets. • The acquisition is expected to be earnings enhancing with immediateeffect without the need to reduce any overheads thus ensuring the customers ofboth companies will benefit from higher quality information and better value formoney. The Company does not anticipate any changes in its dividend policy. Ends Notes to editors: ITIS Holdings plc, listed on AIM, (ITH.L) is the UK's leading provider oftraffic incident and travel information. ITIS has invested in the developmentof a unique system for the collection and analysis of traffic information, itcombines journalistic information with ITIS' historic and real-time FloatingVehicle Data (FVDTM) to provide journey time forecasts and real-time updates.ITIS now operates the largest commercial application of FVD anywhere in theworld, and delivers the content over a variety of platforms including RDS-TMC(Alert C), digital radio and automated telephone services (IVR) under theKeepmoving brand. ITIS has agreements in the UK to provide information to BMW,Ford, Jaguar, Land Rover, Lexus, MINI, Mercedes-Benz, Mitsubishi, Nissan,Porsche, Renault, Rolls Royce, Saab, Subaru, Toyota and Volvo. Aftermarket andportable device customers include Active Pilot, Clarion, Co Pilot, Fujitsu,Harman Becker, Mio, Navicore, Navman, Pioneer, Road Angel, Route 66, SiemensVDO, Snooper, Sony Europe, Telmap, Telenav, TomTom, ViaMichelin and Way Finder. Outside of the UK ITIS uses its Cellular Floating Vehicle Data (CFVDTM) whichtakes anonymous signalling information from wireless networks to determine speedand flow information on a given road network. ITIS has successfully introducedCFVD in Australia, Belgium, Czech Republic, Israel and the USA. Other projectsare underway in Asia, Ireland South Africa and Spain. Enquiries: ITIS Stuart Marks - 0161 929 5788 Andrew Forrest - 0161 929 5788 Trafficlink Nick Somper - 0207 012 3504 Citigate Ged Brumby - 0207 638 9571 Investec Andrew Pinder - 0207 597 4000 Erik Anderson - 0207 597 4000 This information is provided by RNS The company news service from the London Stock Exchange