Wilmington Regulatory News (WIL)

24 Feb 2005 07:01

Wilmington Group Plc24 February 2005 Embargoed until 0700 24 February 2005 WILMINGTON GROUP PLC ("Wilmington", "the Group" or "the Company") Interim Results for the six months to 31 December 2004 Wilmington Group plc, the information and training group, today announces itsinterim results for the six months to 31 December 2004. Highlights • The Group returned a pleasing result: - normalised profit before tax (before amortisation and exceptional items) increased by 15% to £4.1m - turnover up 6% to £39.7m • The good performance reflects the benefits of: - the recent portfolio review - the Group's focus on specific clusters of expertise - expansion of the Group's revenue streams through new products and delivery channels - the growing requirement for high quality information and training amongst professional business communities • The Legal and Regulatory division made good progress • Agence de Presse Medicale exceeded expectations in its first year as part of the Healthcare Division • Outlook continues to be encouraging Commenting on the interim results, Charles Brady, Chief Executive of Wilmington,said: "Wilmington has continued to grow its business and we are pleased with theperformance during the first half of this year, with normalised profit beforetax increasing by 15%. "Wilmington's focus is on the generation of sustainable and growing profits fromservicing the information and training requirements of professional businesscommunities. The outlook for the full year continues to be encouraging." - ends - For further information, please contact: Wilmington Group Plc On the day: 020 7422 6804Charles Brady, Chief Executive Thereafter: 0121 355 0900Basil Brookes, Finance Director Weber Shandwick Square Mile 020 7067 0700Nick Oborne, Kirsty Raper or Yvonne Alexander Note to Editors Wilmington Group plc is one of the UK's leading providers of information andtraining for professional business markets. The Group provides training,arranges industry events and publishes magazines, directories, databases, andspecial reports focused primarily on its five principal sectors of Legal &Regulatory, Healthcare, Media and Entertainment, Drinks and Catering and Designand Construction. Capitalised at approximately £150 million, Wilmington floatedon the London Stock Exchange in 1995. Embargoed until 0700 24 February 2005 WILMINGTON GROUP PLC ("Wilmington", "the Group" or "the Company") Interim Results for the six months to 31 December 2004 CHAIRMAN'S STATEMENT I am pleased to announce the results for Wilmington Group plc for the six monthsto 31st December 2004. Our trading performance was ahead of the corresponding period in 2003. Turnoverin the six months to 31st December 2004 increased to £39.7m (2003: £37.5m).Profit before interest, tax, amortisation and exceptional items ("TradingProfit") increased to £4.5m (2003: £3.6m). Adjusted profit before tax (beforeamortisation and exceptional items) increased to £4.1m (2003: £3.55m). Thecorresponding adjusted earnings per share, calculated before amortisation andexceptional items, increased to 3.08p (2003: 2.73p). An interim dividend for the current year of 1.15p per share (2003: 1.0p pershare) will be paid on 8th April 2005 to shareholders on the register on 11thMarch 2005. Business Review Wilmington's focus is on the generation of sustainable and growing profits fromservicing the information and training requirements of professional businesscommunities. Our strategy is to develop stronger positions in key market sectorsby concentrating investment, both acquisitive and organic, on those markets andto expand revenue streams by adding new products and delivery channels. This strategy has seen turnover grow by 6% and Trading Profit increase by 24%compared to the corresponding period in 2003. As in previous years we expectthat the Group's performance will be weighted to the second half of thefinancial year. The Legal and Regulatory division has increased turnover by 9% to £18.9m (2003:£17.4m) and trading profits by 10% to £4.3m (2003: £3.9m). Many areas within ourLegal and Regulatory division have produced strong performances. Our continuinglegal training has had an excellent six months improving on the performanceachieved in the corresponding period last year. Pendragon has continued to showstrong profit growth and our legal magazines have seen further improvement inadvertising revenues and profitability. In 2004 Central Law Training wasappointed by The Commission for Legal Services and The Law Society to run amandatory accreditation scheme for immigration and asylum advisors. To dateapproximately 2,500 individuals have indicated that they will seek thismandatory accreditation. A substantial amount of work has been undertaken toensure the success of this project. In the Healthcare division, Agence de Presse Medicale has successfully completedits first year as part of the Wilmington Group, exceeding the level of profitsthat we anticipated when we purchased the business. Beechwood has continued togrow and while profits in the six months ended 31st December 2004 were impactedby investment in new products, the benefits of this investment will start to beseen in the second half of the financial year. Overall Beechwood is expected tomake further encouraging progress this financial year. In the Design and Construction division we have now vacated properties inChelmsford and Sevenoaks which will reduce costs and enable greater integrationand efficiency within the division. These actions, and the restructuring of themanagement of the Group, are expected to result in annual cost savings ofapproximately £800,000 and, as indicated in the pre-close period statement, willincur one-off costs this year in the region of £917,000. In January 2005 we sold our 75% stake in Abacus Software Limited forconsideration of £760,000. It was acquired in December 1997 to accelerate ourdevelopment of web based technology and as a result we have made rapid progressin the utilisation of the internet as a source of profit and revenue growth.However, the company now feels that greater flexibility and capacity is achievedby outsourcing its software development. Abacus made a profit before tax of£105,000 in the year ended 30th June 2004. In January 2005 Bernard Jolles, who has been a non-executive director ofWilmington Group since July 2001 and the Chairman since January 2003, steppeddown from the Board. Bernard leaves the business well placed for the next phaseof its development. We thank him for this and I am delighted to succeed him asChairman. Outlook Wilmington has succeeded in growing its business in a challenging tradingenvironment and we are pleased with the performance during the first half ofthis year. The impact of the restructuring instigated during the last financialyear, the continued focus on specific clusters of expertise and the growingrequirement for high quality information and training amongst the professionalbusiness communities that we serve provides the Board with confidence in itsability to deliver profitable growth. The outlook for the full year continues tobe encouraging. The success of Wilmington is founded on the entrepreneurial talents and hardwork of our people. I should like to thank my fellow directors, our businessmanagers and our many employees for all their enthusiasm, hard work and support.Our people remain our greatest asset and their efforts are appreciated. David L SummersChairman WILMINGTON GROUP PLCInterim Results for the six months to 31 December 2004CONSOLIDATED PROFIT AND LOSS ACCOUNT Notes Six Six Twelve months months months ended ended ended 31st Dec 31st Dec 30th June 2004 2003 2004 (unaudited) (unaudited) (audited) £'000 £'000 £'000 Turnover - continuing operations 38,751 35,394 78,236 - discontinued operations 964 2,144 4,422 --------- --------- --------- 2 39,715 37,538 82,658 Cost of sales (13,774) (12,673) (27,473) --------- --------- ---------Gross profit 25,941 24,865 55,185 Operating expenses (21,408) (21,219) (44,572) --------- --------- ---------Operating profit before amortisation of goodwill and intangible assets 4,533 3,646 10,613 Amortisation of goodwill and intangible assets (2,389) (2,073) (4,794) Operating exceptional item 3 (917) - (250) --------- --------- ---------Operating profit/(loss) - continuing operations 1,222 1,858 5,729 - discontinued operations 5 (285) (160) --------- --------- --------- 1,227 1,573 5,569 Non-operating exceptional items 3 - - 251 --------- --------- --------- 1,227 1,573 5,820 Interest receivable and similar income 9 11 15Interest payable and similar charges (459) (107) (423) --------- --------- ---------Profit on ordinary activities before taxation 777 1,477 5,412Taxation 4 (959) (988) (2,695) --------- --------- ---------(Loss)/profit on ordinary activities after taxation (182) 489 2,717Minority interests (263) (252) (658) --------- --------- ---------(Loss)/profit for the period and attributable to shareholders (445) 237 2,059Dividends (959) (833) (2,501) --------- --------- ---------Retained loss for the period (1,404) (596) (442) --------- --------- ---------Earnings per ordinary share 5 (0.53)p 0.28p 2.47p --------- --------- ---------Diluted earnings per ordinary 5 (0.53)p 0.28p 2.46pshare --------- --------- ---------Adjusted earnings per ordinary share 6 3.08p 2.73p 7.73p --------- --------- --------- With the exception of exchange translation gains of £25,000 (2003: Nil) therewere no recognized gains or losses in the six months ended 31st December 2004(2003: £Nil) other than those shown in the profit and loss account. WILMINGTON GROUP PLCInterim Results for the six months to 31 December 2004CONSOLIDATED BALANCE SHEET As at As at As at 31st Dec 31st Dec 30th June 2004 2003 2004 (unaudited) (unaudited) (audited) £'000 £'000 £'000Fixed assets Goodwill and intangible assets 65,396 65,460 64,453Tangible assets 12,666 9,517 11,665 --------- --------- --------- 78,062 74,977 76,118 --------- --------- --------- Current assetsStock and work in progress 2,039 2,385 1,874Debtors 15,803 15,977 17,802Cash at bank and in hand 1,668 1,663 2,954 --------- --------- --------- 19,510 20,025 22,630 Creditors: Amounts falling due within one year (30,064) (35,252) (31,832) --------- --------- ---------Net current liabilities (10,554) (15,227) (9,202) --------- --------- ---------Total assets less current liabilities 67,508 59,750 66,916 Creditors: Amounts falling due after more than one year (9,000) - (7,000)Provision for liabilities and charges (578) (618) (604) --------- --------- ---------Net assets 57,930 59,132 59,312 --------- --------- ---------Capital and reservesCalled-up share capital 4,167 4,167 4,167Share premium account 42,363 42,363 42,363Other reserves 949 949 949Profit and loss account 8,364 9,589 9,743 --------- --------- ---------Equity shareholders' funds 55,843 57,068 57,222 Minority interests 2,087 2,064 2,090 --------- --------- --------- 57,930 59,132 59,312 --------- --------- --------- WILMINGTON GROUP PLCInterim Results for the six months to 31 December 2004CONSOLIDATED CASH FLOW Six Six Twelve months months months ended ended ended 31st Dec 31st Dec 30th June 2004 2003 2004 (unaudited) (unaudited) (audited) Notes £'000 £'000 £'000Reconciliation of operating profit to netcash inflow from operating activities:Operating profit 1,227 1,573 5,569Adjustment for items not involving the flow of funds 3,293 2,932 6,556Net working capital movement 7 (896) (2,950) (156) --------- --------- ---------Net cash inflow from operating activities 3,624 1,555 11,969 Returns on investments and servicing of finance --------- -------- --------Interest received 9 11 15Interest and similar charges paid (450) (90) (545)Dividend paid to minority shareholders in subsidiary undertakings (79) (25) (256) --------- -------- -------- Net cash outflow (520) (104) (786) TaxationCorporation tax paid (1,158) (944) (2,970) Capital expenditure and financial investment --------- -------- --------Purchase of goodwill and intangible assets (383) - (309)Purchase of tangible fixed assets (1,891) (546) (3,854)Sale of tangible fixed assets 11 23 223 --------- -------- -------- Net cash outflow (2,263) (523) (3,940) Acquisitions and disposals --------- -------- --------Purchase of subsidiary undertakings and minority interests (3,215) (11,297) (12,954)Purchase of businesses - (350) (493)Sale of businesses - - 44 --------- -------- -------- Net cash outflow (3,215) (11,647) (13,403) Equity dividends paid (1,667) (1,413) (2,247) --------- --------- --------Cash outflow before financing (5,199) (13,076) (11,377) Financing --------- -------- --------Issue of shares - 225 225New borrowings 2,000 - 7,000Repayment of loan notes (1,000) - - --------- -------- -------- 1,000 225 7,225 --------- -------- --------Decrease in cash (4,199) (12,851) (4,152) --------- -------- --------Reconciliation of net cash flow to movement in net (debt)Change in net (debt) resulting from cash flow (4,199) (12,851) (4,152)Cash arising on acquisitions and disposals - 794 1,024New borrowings (2,000) - (7,000)Net (debt) / cash brought forward (4,538) 5,590 5,590 --------- -------- -------Net (debt) carried forward (10,737) (6,467) (4,538) --------- --------- ------- WILMINGTON GROUP PLCNotes to the Interim Results for the six months to 31 December 2004 1. Nature of InformationThe interim accounts for the six months ended 31st December 2004 and thecomparative figures for the six months ended 31st December 2003 are neitheraudited nor reviewed by the Company's auditors. The comparative figures for thetwelve months ended 30th June 2004 are not the Company's statutory accountswithin the meaning of Section 240 of the Companies Act 1985 but are abridgedfrom such accounts which have been reported on by the Company's auditors anddelivered to the Registrar of Companies. The report of the auditors on suchaccounts was unqualified and did not contain any statement under Sections 237(2)or 237(3) of the Companies Act 1985. The interim accounts and the comparative figures are prepared on the basis ofthe accounting policies set out in the accounts of the Group for the twelvemonths ended 30th June 2004. 2. Segmental information Six Six Twelve months months months ended ended ended 31st Dec 31st Dec 30th June 2004 2003 2004 (unaudited) (unaudited) (audited) £'000 £'000 £'000Turnover:Legal and Regulatory 18,941 17,409 39,087Healthcare 4,740 3,260 8,833Media and Entertainment 3,336 3,228 6,647Design and Construction 5,651 5,628 11,282Drinks and Catering 4,486 4,233 9,035Other 1,597 1,636 3,352Discontinued 964 2,144 4,422 --------- --------- --------- 39,715 37,538 82,658 --------- --------- ---------Profit before taxation: £'000 £'000 £'000 Legal and Regulatory 4,302 3,902 9,622Healthcare 461 100 1,246Media and Entertainment 333 590 947Design and Construction (41) (58) (165)Drinks and Catering 77 (77) 303Other 45 (24) 53Discontinued 5 (285) (160) --------- --------- ---------Trading profit 5,182 4,148 11,846 Less: unallocated central overheads (649) (502) (1,233) --------- --------- ---------Operating profit before interest, exceptional items and amortisation 4,533 3,646 10,613 Less: interest (450) (96) (408) --------- --------- ---------Profit before taxation, amortisation and exceptional items ("adjusted profit") 4,083 3,550 10,205 Exceptional items - operating (917) - (250) - non-operating - - 251 --------- --------- --------Profit before taxation and amortisation 3,166 3,550 10,206Less: amortisation (2,389) (2,073) (4,794) --------- --------- ---------Profit before taxation 777 1,477 5,412 --------- --------- --------- 3. Exceptional itemsOperating exceptional items comprise restructuring costs of £917,000 (2003:Nil). Operating exceptional items for the twelve months to 30th June 2004comprised abortive transaction costs of £250,000. Non-operating exceptional items for the twelve months to 30th June 2004comprised profit on sale of businesses of £251,000. 4. Taxation Six Six Twelve months months months ended ended ended 31st Dec 31st Dec 30th June 2004 2003 2004 (unaudited) (unaudited) (audited) £'000 £'000 £'000The tax charge comprises:UK corporation tax at current rates 1,055 1,138 2,965Adjustment to previous year 11 (90) (93) --------- --------- --------- 1,066 1,048 2,872 Foreign tax 194 - 176Tax on exceptional items (275) - (279) --------- --------- --------- 985 1,048 2,769Deferred tax credit (26) (60) (74) --------- --------- --------- 959 988 2,695 --------- --------- --------- The total tax charge as a percentage of profit before taxation is high becauseof the disallowable amortisation of certain intangibles. The tax charge as apercentage of profit before taxation and amortisation is 30.3% (2003: 27.8%). 5. Earnings per ordinary shareEarnings per ordinary share is calculated on the basis of (loss) / profit onordinary activities after taxation and minority interests divided by 83,351,679(2003: 83,233,254), being the weighted average number of ordinary shares of 5pin issue. Diluted earnings per ordinary share is calculated on the basis of (loss) /profit on ordinary activities after taxation and minority interests divided by83,677,142 (2003: 83,453,890), being the diluted weighted average number ofordinary shares of 5p. 6. Adjusted earnings per ordinary shareAdjusted earnings per ordinary share has been calculated based on an adjustedprofit after taxation and minority interests but before amortisation of goodwilland intangible assets and exceptional items of £2,568,000 (2003: £2,269,000). 7. Net working capital movement Six Six Twelve months months months ended Ended ended 31st Dec 31st Dec 30th June 2004 2003 2004 (unaudited) (unaudited) (audited) £'000 £'000 £'000 (Increase)/decrease in stock and workin progress (165) (332) 136Decrease in debtors 1,951 1,137 372(Decrease) in creditors (2,682) (3,755) (664) --------- --------- --------- (896) (2,950) (156) --------- --------- --------- 8. International Accounting StandardsAs a result of the requirement for the Group to produce accounts in accordancewith International Financial Reporting Standards (IFRS), the Group is in theprocess of quantifying the likely impact of IFRS on its published financialstatements. It is anticipated that the accounting treatment of goodwill andintangible assets, deferred tax, share options, pension fund surpluses/deficitsand financial instruments will be impacted although this list is not necessarilyexhaustive. 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