Stratmin Global Resources Regulatory News (STGR)

15 Sep 2006 07:00

Interactive Prospect TargetingHdgs15 September 2006 For release 07.00am 15 September 2006 Interactive Prospect Targeting Holdings plc ("IPT") Interim Results IPT (IPH.L), the UK's leading on-line direct marketing services company,announces record interim results for the six months to 30 June 2006, reflectedin the strong organic growth of operating profits in the core businesses. Amajor acquisition in France in May, IPT'S first in Europe and largest to date,has moved the business onto a European dimension. Highlights • Turnover up 73% to £9.8m (2005 : £5.7m) • Headline operating profits up 156% to £1.8m (2005 : £0.7m) • Pre-tax profits up 94% to £1.75m (2005 : £1.19m) • Diluted EPS up 23% to 3.2p (2005 : 2.6p) • Total equity £31.02m, (2005 : £8.31m) • Headline operating margin 18.6% (2005: 12.6%) • Acquisition of Directinet, the leading online direct marketing company in France, on May 24th for approx £22.4m (maximum consideration) Commenting, Lionel Thain, Chief Executive, said: "In 2006 internet advertisingis expected to represent the third largest segment within the total advertisingmarket after TV and newspapers, growing at on current estimates at nearly 50%per annum compared to less than 4% in overall advertising expenditure. We viewthe remainder of 2006 with a positive outlook. We retain our market leadingposition in Internet direct marketing in the UK and with the acquisition haveestablished a similar position in the wider European market. The second half hasbegun on a positive note." Notes to Editors • IPT is established as the number 1 online consumer data and services company in the UK • Directinet similarly establishes the Group as the market leader in France • The UK and French markets together account for approximately 64% of total internet advertising spend across Europe • The Group's market position is continually enhanced by the introduction of additional successful products and services to the French market • Both markets showing continuing high levels of growth • The Group has over 750 blue chip clients • The Group's data bases currently list over 6m e-mail addresses and 9m postal addresses Enquiries: Interactive Prospect Targeting Holdings plcLionel Thain, CEO Tel: 020 7932 4100Ivan Southall, Director Tel: 020 7932 4100 Adventis Financial PRPeter Binns Tel: 020 7034 4760 / 07768 392 582Chris Steele Tel: 020 7034 4759 / 07979 604 687Annie Evangeli Tel: 020 7034 4757 / 07778 507 162 Canaccord Adams LtdMark Williams Tel: 020 7518 2777 Overview Interactive Prospect Targeting Holdings plc (IPT) has continued to makesignificant progress in the 6 months to 30 June 2006 with its core businessesexperiencing strong organic growth. In addition, a major acquisition in Francehas moved the business into a European dimension. In the six-month period to June 2006: • Revenue increased 73% to £9.8 million on June 2005; • Headline Operating Profit* increased by 156% to £1.8m on June 2005 (see note 3); • Headline earnings** per share increased 111% to 4.0p on June 2005 (see note 5). Basic earnings per share were 3.6p; • Group operating profit rose by 131% to £1.7m on June 2005; • Acquisition of Directinet, the leading online direct marketing services company in France, for a maximum consideration of €33m (£22.4m) was completed. The above results include Directinet's profit from the date of acquisition, being 31 May 2006; IPT continues to lead the UK as the number 1 online consumer data and servicescompany, which is reflected in the strong growth of operating profits. The acquisition of Directinet in May 2006 establishes the Group with a marketleading position in France, which will be further enhanced by introducing theGroup's successful UK products and services to the French market. The second half-year has begun on a positive note from all of our core UKoperating divisions, with the integration of Directinet progressing as expected. --------------------------* before goodwill impairment, amortisation of other intangibles and one-timerestructuring costs.**before goodwill impairment, amortisation of other intangibles, one-timerestructuring costs and profit on available-for -sale investments.*before goodwill impairment, amortisation of other intangibles, and one-timerestructuring costs as defined in note 3. CHAIRMAN'S STATEMENT IFRSThis is the Group's first set of results under the new IFRS accountingstandards. The principal changes relate to goodwill, share based payments andtax expense but had minimal effect on the underlying operating performance ofthe Group in this period. ResultsRevenues increased by 73% to £9.8m (2005: £5.7m) in the 6 months ended June2006, with strong growth across all product lines. Headline Operating profits* for the period increased by 156% to £1.8m (2005:£0.7m). Significantly our headline operating margin* for the 6 months to June2006 increased to 18.6%, up from 12.6% for the 6 months to 30 June 2005 and14.6% for the 12 months to 31 December 2005. Group Operating profit for the period was £1.7m (2005: £0.7m), profit after taxwas £1.3m (2005: £0.9m), and basic earnings per share were 3.6p (2005: 3.0p) OverviewUK Internet advertising expenditure continues to grow well ahead of the generalgrowth in advertising expenditure. The World Advertising Research Centre's,European Advertising & Media forecast July 2006, predicts growth in Internetadvertising expenditure of 49.9% in 2006 (to £2bn) compared to a general growthof 3.9% (to £15.5bn) in overall advertising expenditure. In 2006 Internetadvertising is expected to represent the third largest segment within the totaladvertising market behind only TV and Newspapers. IPT has continued to flourish in this rapidly expanding market place. OurCustomer Acquisition products go from strength to strength with MyOffers.co.ukcontinuing to lead the market in the collection of on-line consumer informationfor marketing purposes. Customer Acquisition currently collects between 3m to 4mquestionnaires each month on behalf of its customers. WebBrands, which wasestablished in 2005, is now firmly established as the UK's leading sharedregistration program. Our IPT Direct products continue to provide data to its customers for directcommunication by email, post or SMS. Following the acquisition of the PostalPreference Service in 2005, the provision of data for postal direct marketinghas increased both in numbers and value and now represents a significantproportion of this revenue. IPT currently carries out, on average, over 139direct campaigns per month on behalf of its clients. IPT continues to develop new and innovative products and launch new web sitesdesigned to acquire data focussed on specific market segments. In July IPTlaunched MyPropertySpy.co.uk, a web site dedicated to acquiring data aboutproperty and home movers and providing information to these individuals. Thisweb site is rapidly building a database of marketing prospects representingconsumers at a particular life-cycle stage. AcquisitionsAs announced on 24 May 2006, the Group acquired the entire issued share capitalof Directinet for a maximum consideration of €33.0m (approximately £22.4m). Theconsideration is payable as an initial consideration of €24.5m (approximately£16.9m) and a maximum contingent consideration of €8.5m (approximately £4.6mafter discounting future cash payments) to the management vendors based onachieving certain financial targets for the years ended 31 December 2006, 2007and 2008 (see note 8). Directinet is the leader in Internet direct marketing in France. Together withIPT's leading position in the UK market, the combined Group is uniquely wellpositioned to lead the provision of Internet direct marketing services in Europe. Many of the programmes and sites provided by IPT in the UK can berapidly rolled out into France, enhancing the Directinet operating model andleading to synergistic benefits. The acquisition is the first by IPT in Europeand its largest to date. The French and UK markets together account for some 64% of the total spend onInternet advertising across Europe and both markets continue to grow rapidly. In May 2006, to coincide with the acquisition of Directinet, the Groupsuccessfully raised £11m, net of expenses, in a secondary placing of 5.6 millionshares on the AIM, at a price of £2.05 per share. In April 2006, the Group acquired the business and assets of Direct ExcellenceLimited ("DE"), a business that helps organisations develop more effectivecustomer management strategies, for an initial consideration of £0.5m (see note8). Subsequent to the period-ended 30 June 2006, the Group acquired the entireissued share capital of Smartquotes Limited, an online company that providesindividuals with access to consumer finance products, for a total considerationof £0.3m (see note 9). OutlookIPT has achieved its objectives for the first half-year and views the remainderof 2006 with a positive outlook. It retains its market leading position inInternet direct marketing in the UK and with the acquisition of Directinet isnow poised to participate in the wider European market. Colin LloydNon-executive Chairman14 September 2006 INDEPENDENT REVIEW REPORT TO INTERACTIVE PROSPECT TARGETING HOLDINGS PLC ("theGROUP") IntroductionWe have been instructed by the Group to review the financial information for thesix months ended 30 June 2006 that comprises the consolidated income statement,the consolidated statement of recognised income and expenses the consolidatedbalance sheet, the consolidated cash flow statement and related notes 1 to 9. Wehave read the other information contained in the interim report and consideredwhether it contains any apparent misstatements or material inconsistencies withthe financial information. This report is made solely to the Group in accordance with Bulletin 1999/4issued by the Auditing Practices Board. Our work has been undertaken so that wemight state to the Group those matters we are required to state to them in anindependent review report and for no other purpose. To the fullest extentpermitted by law, we do not accept or assume responsibility to anyone other thanthe Group, for our review work, for this report, or for the conclusions we haveformed. Directors' responsibilitiesThe interim report, including the financial information contained therein, isthe responsibility of, and has been approved by, the directors. The directorsare responsible for preparing the interim report in accordance with the ListingRules of the Financial Services Authority which require that the accountingpolicies and presentation applied to the interim figures are consistent withthose applied in preparing the preceding annual accounts except where anychanges, and the reasons for them, are disclosed. International Financial Reporting StandardsAs disclosed in note 1, the next annual financial statements of the Group willbe prepared in accordance with International Financial Reporting Standards asadopted for use in the EU. Accordingly, the interim report has been prepared inaccordance with the recognition and measurement criteria of IFRS and thedisclosure requirements of the Listing Rules. The accounting policies areconsistent with those that the directors intend to use in the annual financialstatements. There is, however, a possibility that the directors may determinethat some changes to these policies are necessary when preparing the full annualfinancial statements for the first time in accordance with IFRSs as adopted foruse in the EU. Review work performedWe conducted our review in accordance with the guidance contained in Bulletin1999/4 issued by the Auditing Practices Board for use in the United Kingdom. Areview consists principally of making enquiries of Group management and applyinganalytical procedures to the financial information and underlying financial dataand, based thereon, assessing whether the accounting policies and presentationhave been consistently applied unless otherwise disclosed. A review excludesaudit procedures such as tests of controls and verification of assets,liabilities and transactions. It is substantially less in scope than an auditperformed in accordance with International Standards on Auditing (UK andIreland) and therefore provides a lower level of assurance than an audit.Accordingly, we do not express an audit opinion on the financial information. Review conclusionOn the basis of our review we are not aware of any material modifications thatshould be made to the financial information as presented for the six monthsended 30 June 2006. Deloitte & Touche LLPChartered Accountants,Reading14 September 2006 CONSOLIDATED INCOME STATEMENT FOR THE SIX MONTHS ENDED 30 JUNE 2006 Continuing operations 6 months 6 months Year ended ended ended 30 June 30 June 31 December 2006 2005 2005 Note Unaudited Unaudited Unaudited £'000 £'000 £'000 Revenue 9,800 5,669 13,560 Cost of sales (2,163) (1,109) (2,381) Gross profit 7,637 4,560 11,179--------------------------- ------ -------- -------- ---------Administrative expenses (5,811) (3,846) (9,197)Costs of restructuring - - (230)Goodwill impairment (88) - -Amortisation of otherintangibles - non-data (88) - (36)--------------------------- ------ -------- -------- --------- Total administrative expenses (5,987) (3,846) (9,463) Operating Profit 1,650 714 1,716 Profit on disposal ofavailable-for-sale investments - 354 509 Interest on bank deposits 97 119 190 Profit on ordinary activitiesbefore tax 1,747 1,187 2,415 Tax 4 (467) (254) (576) Profit for the period fromcontinuing operations 1,280 933 1,839 Profit attributable to equityholders of the parent 1,280 933 1,839 Earnings per share fromcontinuing operations 5 Basic (pence) 3.6 3.0 5.7 Diluted (pence) 3.4 2.7 5.3 CONSOLIDATED STATEMENT OF RECOGNISED INCOME AND EXPENSEFOR THE SIX MONTHS ENDED 30 JUNE 2006 6 months 6 months Year ended ended ended 30 June 30 June 31 December 2006 2005 2005 Note Unaudited Unaudited Unaudited £'000 £'000 £'000 Gains on revaluation ofavailable-for-sale investmentstaken to equity - 21 59Tax on items taken directly toequity 435 (13) 631 Net income recognised directlyin equity 435 8 690 Transfer to profit on sale ofavailable-for-sale investments - (354) (509) Profit for the period 1,280 933 1,839 Total recognised income forthe period 1,715 587 2,020 Attributable to:Equity holders of the parent 1,715 587 2,020 CONSOLIDATED BALANCE SHEET AT 30 JUNE 2006 30 June 30 June 31 December 2006 2005 2005 Note Unaudited Unaudited Unaudited £'000 £'000 £'000Non-current assetsGoodwill 8 22,143 44 2,438Other intangibleassets 4,884 649 2,556Property, plant andequipment 647 405 449Deferred tax asset 1,618 667 1,139 29,292 1,765 6,582 Current assetsTrade and otherreceivables 7,435 3,301 5,212Cash and cashequivalents 6,693 5,461 5,414 14,128 8,762 10,626Assets held for sale - 186 - Total assets 43,420 10,713 17,208 Current liabilitiesTrade and other payables (5,828) (1,860) (4,263)Current Tax liabilities (638) (538) (187)Obligations underfinance leases (1) (8) (5)Bank loans and overdrafts (83) - -Provisions 8 (1,723) - - (8,273) (2,406) (4,455) Non-current liabilitiesBank loans andoverdrafts (332) - -Deferred tax liability (888) - (219)Provisions 8 (2,911) - - (4,131) - (219) Total liabilities (12,404) (2,406) (4,674) Net assets 31,016 8,307 12,534 EQUITYCalled up share capital 6 177 133 143Share premium account 6 23,437 3,915 6,747Own shares 6 (72) (2) (72)Share option reserve 6 91 40 62Revaluation reserve 6 - 117 -Other reserves 6 2,386 2,372 2,372Retained earnings 6 4,997 1,732 3,282 Total equity 6 31,016 8,307 12,534 These financial statements were approved by the Board of Directors on 14 September 2006. Signed on behalf of the Board Eoin RyanDirector CONSOLIDATED CASH FLOW STATEMENT FOR THE SIX MONTHS ENDED 30 JUNE 2006 6 months 6 months Year ended ended ended 30 June 30 June 31 December 2006 2005 2005 Note Unaudited Unaudited Unaudited £'000 £'000 £'000 Net cash from operatingactivities 7 2,208 174 1,859 Investing activitiesInterest received 97 119 190Proceeds on disposal ofavailable-for-saleinvestments - 516 755Purchases of plant, propertyand equipment (374) (230) (451)Purchases of otherintangibles - data (592) (304) (808)Acquisition of subsidiary (11,100) - (1,121) Net cash (used in) / frominvesting activities (11,969) 101 (1,435) Financing activitiesRepayment of loans andoverdrafts on acquisitions - - (2,966)Proceeds on issue of shares 11,027 (12) 2,831Purchase of own shares - - (70)Repayment of obligationsunder finance leases (5) (6) (9) Net cash from /(used in)financing activities 11,022 (18) (214) Net increase in cash andcash equivalents 1,261 257 210 Cash and cash equivalents atthe beginning of the period 5,414 5,204 5,204 Effect of foreign exchangerate changes 18 - - Cash and cash equivalents atthe end of the period 6,693 5,461 5,414 NOTES TO THE FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED 30 JUNE 2006 1. Basis of preparation For the year ending 31 December 2006, the Group will prepare consolidatedfinancial statements under IFRS as adopted by the European Commission. Thesewill be those International Accounting Standards, International FinancialReporting Standards and related interpretations (SIC-IFRIC interpretations),subsequent amendments to those standards and related interpretations, futurestandards and related interpretations issued or adopted by the IASB that havebeen endorsed by the European Commission. This process is ongoing and theCommission has yet to endorse certain standards issued by the IASB. This interim report for the 6 months ended 30 June 2006, is the first interimreport under IFRS. The interim report is unaudited and has been prepared on thebasis of the accounting policies set out in the financial statements for theyear ended 31 December 2005, amended where necessary to comply with IFRS.Details of these amendments are set out in the Group's IFRS restatementdocument, released on 12 September 2006 and available on the Group's website orfrom the Company Secretary. 2. Publication of non-statutory accounts The financial information for the six months ended 30 June 2006 and 30 June 2005has not been audited and does not constitute full financial statements withinthe meaning of Section 240 of the Companies Act 1985. The financial information relating to year ended 31 December 2005, does notconstitute full financial statements within the meaning of Section 240 of theCompanies Act 1985. This information is based on the Group's statutory accountsfor that period, restated for IFRS. Those statutory accounts that were preparedin accordance with United Kingdom Generally Accepted Accounting Principles (UKGAAP) received an unqualified report and have been filed with the Registrar ofCompanies. 3. Operating profit 6 months 6 months Year ended ended ended 30 June 30 June 31 December 2006 2005 2005 Unaudited Unaudited Unaudited £'000 £'000 £'000 Reported Operating Profit 1,650 714 1,716 Add back:- goodwill impairment 88 - -- amortisation of other intangibles - non-data 88 - 36 - restructuring costs - - 230 Headline Operating Profit 1,826 714 1,982 4. Tax The tax expense comprises: 6 months 6 months Year ended ended ended 30 June 30 June 31 December 2006 2005 2005 Unaudited Unaudited Unaudited £'000 £'000 £'000 Current taxUK corporation tax (446) (407) (696)Adjustment in respect of prior years - - (16) (446) (407) (712) Deferred taxDecrease in deferred tax liability 26 151 230(Decrease)/ increase in recoverabledeferred tax asset (47) 2 (94) (21) 153 136 Total tax expense (467) (254) (576) 5. Earnings per share The calculation of earnings per share is based on the following profits andnumber of shares: 6 months ended 6 months ended Year ended 30 June 2006 30 June 2005 31 December 2005 Unaudited Unaudited Unaudited ------ ------- ------ ------ ------- ------ ------ ------- ------ Profit Number of Pence Profit Number of Pence Profit Number of Pence shares per shares per shares per £'000 '000 share £'000 '000 share £'000 '000 share ------ ------- ------ ------ ------- ------ ------ ------- ------ Headline earnings per share* 1,430 35,790 4.0 579 31,021 1.9 1,516 32,048 4.7 Reconciliation to reported earnings (net of tax at 30%):-goodwill impairment (88) - --amortisation of otherintangibles - non-data (88) - (36)-profit on available-for-saleinvestments - 354 509-restructuring costs - - (230)-tax effect of the above items 26 80 Basic earnings per share 1,280 35,790 3.6 933 31,021 3.0 1,839 32,048 5.7 Impact of share options - 2,392 (0.2) - 2,907 (0.3) - 2,556 (0.4) Diluted earnings per share 1,280 38,182 3.4 933 33,928 2.7 1,838 34,604 5.3 *Headline earnings per share excluding goodwill impairment, amortisation ofother intangibles, profit on available-for-sale investments, and one-timerestructuring costs have been included as the Directors consider that thisfigure provides a meaningful measure on the ongoing business. 6. Reconciliation of movement in total equity Called Share Own Share Other Retained up share premium shares Option reserve earnings capital account reserve £'000 £'000 £'000 £'000 £'000 £'000 £'000 At 1 January 2006 143 6,747 (72) 62 2,372 3,282 12,534Issue of shares 34 17,163 - - - - 17,197Costs for issue of shares - (473) - - - - (473)Total income recognised for the period - - - - - 1,715 1,715Share options movement - - - 29 - - 29Translation reserve - - - 14 - 14 At 30 June 2006 177 23,437 (72) 91 2,386 4,997 31,016 7. Reconciliation of operating profit to net cash inflow from operating activities 6 months 6 months Year ended ended ended 30 June 30 June 31 December 2006 2005 2005 Unaudited Unaudited Unaudited £'000 £'000 £'000 Operating profit 1,650 714 1,716 Depreciation 214 144 350Amortisation - data 449 127 476Amortisation - other intangibles 88 - 36Impairment of goodwill 88 - -Share based payments expense 29 15 37Increase/ (decrease) in receivables 385 (838) (1,746)(Decrease)/ increase in payables (680) 26 1,142Tax expense (15) (14) (152) Net cash inflow from operatingactivities 2,208 174 1,859 8. Acquisitions DirectinetOn 24 May 2006, the Group acquired the entire issued share capital of Directinetfor a maximum consideration of €33.0m (approx. £22.4m). The provisional fairvalue of net assets acquired was £3.3m giving rise to goodwill on acquisition of£19.1m. The consideration was satisfied as follows: Unaudited £'000 Cash consideration 11,182Shares issued 5,697Provision for payments due on earn-out agreement 4,607Costs of acquisition 885 22,371 Direct ExcellenceIn April 2006, the Group acquired the business and assets of Direct ExcellenceLimited for an initial consideration of £0.5m, giving rise to goodwill onacquisition of £0.6m. The consideration was satisfied in cash. A furthercontingent consideration of £27,000 is currently provided for. 9. Subsequent event On 28th July 2006, the Group acquired the entire issued share capital ofSmartquotes Limited, an online company that provides individuals with access toconsumer finance products, for a total consideration of £0.3m. ADVISERS REGISTERED NUMBER5173250 England and Wales GROUP HEAD OFFICE AND REGISTERED ADDRESS30 Buckingham GateLondonSW1E 6NN NOMINATED ADVISOR AND BROKERCanaccord Adams Limited1st Floor, Brook House27 Upper Brook StreetLondon W1 PRINCIPAL BANKERSBarclays Bank plc1st Floor99 Hatton GardenLondon EC1 SOLICITORSBircham Dyson Bell50 BroadwayLondon SW1 AUDITORSDeloitte & Touche LLPChartered AccountantsReading REGISTRARSCapita Registrars34 Beckenham RoadBeckenhamKent BR3 4TU This information is provided by RNS The company news service from the London Stock Exchange