Final Results
27 June 2011
Totally PLC
("Totally" or "the Company")
Final results for the year ended 31 December 2010
Performance highlights
* Revenues from continuing operations £1.88m +7 per cent. yr/yr (2009: £
1.76m).
* Gross Profit from continuing operations £0.145m + 5 per cent yr/yr (2009: £
0.138m)
* Operating Profit from continuing operations before tax £0.10m (2009: £
0.14m)
* Total EBITDA from continuing operations £0.15m (2009: £0.17m).
* Total operating profit from continuing operations before tax and head
office charges £0.39m (2009: £0.43m).
* Total EBITDA from continuing operations before head office charges was £
0.43m (2009: £0.46m).
* Cash generated from operating activities £0.08m (2009: £0.16m).
* Basic earnings per share 0.1p (2009: 0.2p per share)
Chairman's Statement
Despite the ongoing recessionary pressures I am pleased to be able to report a
second consecutive year of profit in 2010 and an increase in revenues of 7 per
cent and in Gross Profit of 5 per cent.
The Group generated revenues from continuing operations of £1.88m (2009: £
1.76m), EBITDA of £0.15m (2009: £0.17m) and an operating profit before tax from
continuing operations of £0.11m (2009: £0.14m).
I believe this is a positive achievement in a challenging marketplace and is
testimony to the skills of our staff and to the leadership of our business.
Board, Staff and Clients
I would like to thank Totally's board and staff for their efforts over the
period under review as well as our clients.
Prospects
Trading since the beginning of the current financial year has, despite the
continuing weak market conditions, been stable and the Board looks forward to a
positive outcome for the full year.
Dr. Michael Sinclair
Non-Executive Chairman
Further enquiries:
Totally Plc www.totallyplc.com
Daniel Assor, CEO 020 7692 6929
Merchant Securities Limited
Simon Clements 020 7628 2200
Virginia Bull
Business review
The Business Review should be read in conjunction with the Chairman's Statement
on page 4 which includes information about the Group's business performance
during the year and an indication of the Group's future prospects. A review of
the Group's financial position is included in the Directors' report.
Digital Marketing: "Totally Communications "
2010 saw strong top lines sales growth of 15.2 per cent. despite an uncertain
market with recessionary pressures.
During the period under review, the division's three core units of website and
bespoke software development; hosting maintenance & support and online
marketing, delivered continued and sustainable revenue growth. 65 organisations
are now secured on long-term hosting, maintenance and support contracts, which
make up over 20 per cent. of revenues.
Rise Digital, a dedicated Online Marketing division, was launched. Rise
specialises in the delivery of Search Engine Optimisation, Pay per Click and
Social Media campaigns. Rise Digital revenues represented c.10 per cent. of
annual revenues and long-term contracts for SME's and corporate organisations
were secured.
Particularly strong growth was achieved developing websites and bespoke
web-enabled software for clients in both the private and Not for Profit
sectors. One contributing factor was the completion of an enterprise website
management system, Pelorous, which enables development and subsequent
implementation of large scale web-based propositions expediently without
compromising quality or robustness. Pelorous is a result of a number of years
of development and reduces the requirement for client testing of new websites
and online propositions by approximately 30 per cent.
During this reporting period, Totally Communications has continued to work with
a number of its long-term clients, delivering consultancy and web-enabled
solutions, however as recessionary pressures in the market place have
continued, a number of additional organisations have secured Totally
Communications expertise and experience to deliver efficiencies by leveraging
the power of the Internet.
During the reporting period, Totally Communications commercial and corporate
clients included Barclays Capital, Solar Century (leading solar energy
company), and The Clear Company (specialist recruiter for companies such as
E.O.N and B.T.), BSB Law & Volcanoes Safaris. However Totally Communications
made significant progress in its position as a specialist in the third sector.
Highlights for the reporting period include:
Health Foundation (a not for profit organisation dedicated to clinical
excellence in the UK); Totally Communications constructed a large website
proposition containing an online network and online resources. This was a multi
agency pitch.
Employers Forum on Disability; Totally Communications secured a large project
to bring online an updated version of the clients scorecard system which is a
self-help tool to allow organisations to monitor their compliance with their
legal requirements covering disability.
WJR; the leading UK Jewish international agency responding to the needs of
Jewish communities at risk or in crisis, outside the UK; Totally Communications
was retained for a third time to upgrade their substantial website proposition
which includes an ethical giving micro-site.
Philanthropy Bridge Foundation; an organisation which works to connect giving
from emerging economy countries with charities around the world; Totally
Communications was secured to construct a modest initial website for this new
organisation working with high-profile individuals to target giving in the
third world.
The Holocaust Explained; an educational portal dedicated to Key Stage 3 of the
national curriculum, sponsored by Deutsche Bank and the London Grid, resulting
in a high profile launch at the Foreign Office by Secretary of State for
Education, Michael Gove.
Totally Communications' ongoing support for the third sector saw significant
work on its proprietary product, "Totally Giving", a new donor acquisition tool
for charities. The initial prototype was launched prior to this reporting
period for a charity which resulted in "54 per cent. of all donations via the
portal being from new donors". During the period under review the system was
sold to a second charity and developed into a generic fundraising support tool
to be rolled out as Totally Communications' first stand -alone product. The
product has significant potential in the third sector market, as it focuses on
the acquisition of data which subsequently drives new donor acquisition which
continues to be a significant growth area for charities that are all facing
fundraising pressures.
Post Reporting Period Events
Q1 & Q2 2011 have seen a continuation of the strategy for aggressive organic
growth, and have shown a significant increase of 25 per cent. (unaudited) in
revenues in this division compared to the same period in 2010, whilst cash
collection has shown an increase of nearly 50 per cent. (unaudited) in this
division.
As a result, Totally Communications has moved into a substantially larger
office, and is currently recruiting a number of additional employees.
During the first few months of 2011, following a multi-agency pitch, Totally
Communications, was delighted to be awarded a contract with the charity Crisis
to construct an extensive web-enabled volunteer management system. Totally
Communications reach into the third sector continued with contract wins with
Parenting UK and Kusuma Trust along with ongoing work with The Health
Foundation. Other notable project wins since the start of 2011 included for
Linked In, Le Cordon Bleu and Katie Price. Notable contract wins for Rise
Digital included Ingersoll Rand (international commercial manufacturer),
Homesun (solar power), Art You Grew Up With, Celebrity Group and Paulie
Clothing.
Andy Margolis
Managing Director Totally Communications Limited
Niche Community Publishing
The Jewish News & Media Group is the umbrella brand for the group's publishing
businesses which include two trading subsidiaries, the Jewish News Limited and
TotallyJewish.com Limited.
The group publishes on and offline media for the UKs Jewish community
including:
• A weekly newspaper, `Jewish News'
• A quarterly lifestyle magazine, `Pulse'
• An annual Celebrations magazine, `TotallyJewishSimchas'
• A community portal, `www.TotallyJewish.com'
• An annual Wedding exhibition, www'TotallyJewishSimchas Live!'
www.thejngroup.com
Performance Highlights
• Revenues of £1,146,000, (2009: £1,130,000)
• EBITDA of £204,000 (2009: £252,000)
• Operating Profit of £177,000 (2009: £228,000)
Post Reporting Period Events
In May 2011 the business announced plans to hold a significant new community
exhibition at Wembley Stadium on 18 March 2012. Jewish Living Expo is a
consumer event where visitors will be invited to browse, eat, shop and engage
with 175+ quality brands from across an array of industries including food,
travel, education, fashion, community, lifestyle and the home. In addition live
performances and educational workshops will be held throughout the day.
Revenues will be derived from entrance tickets, stand sales and sponsorship.
www.jewishlivingexpo.com
Dan Assor
CEO & Managing Director Jewish News & Media Group
Consolidated Income Statement for the year ended 31 December 2010
Note 2010 2009
£000 £000
Continuing operations
Revenue 1,882 1,758
Cost of Sales (427) (381)
Gross profit 1,455 1,377
Administrative expenses (1,308) (1,204)
Profit before interest, tax, depreciation and 147 173
amortisation
Depreciation (1) (5)
Amortisation (40) (24)
Operating profit 106 144
Finance costs (20) (19)
Profit before taxation 86 125
Income tax 3 10 16
Profit for the year attributable to the equity 96 141
shareholders of the parent company
All comprehensive income for the current and prior
year is included in the income statement above.
Earnings per share 2010 2009
Pence Pence
Basic
Continuing operations 0.1p 0.2p
Diluted
Continuing operations 0.1p 0.2p
Consolidated statement of changes in equity for the year ended 31 December 2010
Share Share Translation Profit and Equity
Reserve
capital premium loss shareholders'
account account deficit
£000 £000 £000 £000 £000
At 1 January 2009 1,124 3,353 - (5,062) (585)
Profit for the year - - - 141 141
Credit on issue of - - 5 5
share options
Credit on issue of - - - 7 7
warrants
At 1 January 2010 1,124 3,353 - (4,909) (432)
Profit for the year - - - 96 96
Credit on issue of - - - 2 2
share options
Credit on issue of - - - 13 13
warrants
At 31 December 2010 1,124 3,353 - (4,798) (321)
Consolidated statement of financial position as at 31 December 2010
Note 2010 2009
£000 £000 £000 £000
Non current assets
Intangible fixed assets 38 60
Property, plant and equipment 4 4
42 64
Current assets
Trade and other receivables 4 374 266
Cash and cash equivalents - -
374 266
Current liabilities
Trade and other payables (335) (321)
Financial liabilities (402) (441)
(737) (762)
Net current liabilities (363) (496)
Net liabilities (321) (432)
Shareholders' equity
Called up share capital 1,124 1,124
Share premium account 3,353 3,353
Retained earnings (4,798) (4,909)
Equity shareholders' deficit (321) (432)
Consolidated cash flow statement for the year ended 31 December 2010
Note 2010 2009
£000 £000
Operating activities
Operating profit 106 144
Option and warrants charge 15 12
Amortisation and depreciation 41 29
(Increase)/decrease in trade and other receivables (108) 24
Increase/(decrease) in trade and other payables 14 (65)
Cash flow from operations 68 144
Taxation
R&D tax credit 3 10 16
Net cash flows from operating activities 78 160
Investing activities
Purchase of property, plant and equipment (19) (35)
Net cash flows from investing activities (19) (35)
Cash inflow before financing 59 125
Financing activities
Interest paid (20) (19)
Net increase in cash and cash equivalents 39 106
Cash and cash equivalents at beginning of year (441) (547)
Cash and cash equivalents at end of year (402) (441)
Cash and cash equivalents comprise:-
Bank overdrafts (402) (441)
(402) (441)
Notes to the financial statements for the year ended 31 December 2010
1. General information
Totally Plc is a public limited company ("Company") incorporated in the United
Kingdom under the Companies Act 2006 (registration number 3870101). The Company
is domiciled in the United Kingdom and its registered address is Unit 611
Highgate Studios, 53-79 Highgate Road, London NW5 1TL. The Company's Ordinary
Shares are traded on the AlM Market of the London Stock Exchange ("AIM")
The Group's principal activities have been niche community media and the
provision of software development and digital marketing services. The Company's
principal activity is to act as a holding company for its subsidiaries.
2. Basis of preparation
The financial year represents the 365 days to 31 December 2010, and the prior
financial year, 365 days to 31 December 2009. The financial statements are
presented in sterling and all values are rounded to the nearest thousand pounds
(£000) except when otherwise indicated.
The accounting policies set out in note 4 have been applied consistently to all
periods presented in these consolidated financial statements.
The financial statements are prepared on a going concern basis which the
Directors believe to be appropriate for the following reasons. The Group
currently meets its day to day working capital requirements through two
overdraft facilities which are repayable on demand.
The Group has confirmed the availability of a facility of £700,000 with Bank
Hapoalim which was renewed on until 30 June 2010. As security for the facility,
the bank has obtained the unlimited Joint and Several Guarantees of Dr Michael
Sinclair (non-executive Chairman), and Mr Leo Noe. Dr Sinclair and Mr Noe have
confirmed to the Company that they will keep this guarantee in place until 31
May 2012.
In addition, a working capital facility of £50,000 has been agreed with NatWest
which is secured on the Group's debtor book. This facility is due for renewal
on 30 September 2011.
The Directors have prepared projected cash flow information for the period
ending 12 months from the date of their approval of these financial statements.
On the basis of cash flow forecasts and discussions with the Group's bankers
and guarantee holders, the Directors consider that the Group will be able to
operate within the facilities currently agreed.
Inherently, there can be no certainty in relation to these matters, but the
Directors believe that the going concern basis of preparation continues to be
appropriate.
3. Taxation
a. Taxation charge
b.
2010 2009
£000 £000
Research and development tax credit (10) (16)
Total current income tax credit charged in the income (10) (16)
statement
b. Taxation reconciliation
The current income tax credit for the period is explained below:
2010 2009
£000 £000
Profit before tax 86 125
Taxation at the standard UK income tax rate of 28 per cent 24 35
(2009: 28 per cent)
Research and Development tax credit (10) (16)
Utilisation of brought forward tax losses (24) (35)
Total income tax credited in the income statement (10) (16)
c. Deferred tax
Estimated tax losses of approximately £3,600,000 (2009: £3,699,000) are
available to relieve future profits of the Group. A deferred tax asset has not
been recognised in respect of these losses due to uncertainty as to the timing
and tax rate at which these losses will be utilised against future taxable
profit streams.
4. Trade and other receivables
2010 2009
£000 £000
Trade receivables 283 200
Less: provision for impairment on receivables (8) (1)
Trade receivables -net 275 199
Amount due from group undertakings - -
Other debtors 10 10
Prepayments and accrued income 89 57
374 266
5. Related party transactions
The Group has taken advantage of the exemption available under IAS 24, "Related
Party Disclosures", not to disclose details of transactions between Group
undertakings which are eliminated on consolidation.
Included within current liabilities on the Company statement of financial
position are amounts owed to 100% subsidiary undertakings of £1.26m (2009: £
0.55m). The movement in the Company's balances with its subsidiaries reflects
the group's banking facilities and arrangements operating during the year.
The following related party transactions have been carried out at arm's length
and are required to be disclosed in accordance with IAS24.
As set out in note 3, Dr Michael Sinclair and Mr Leo Noe have provided
guarantees in respect of the Group's current overdraft facility.
The company charged East Kings Ltd £12,500 (2009: £nil) for technical services
provided. Dr M J Sinclair is a director of East Kings Ltd.
In 2010, purchases of £nil (2009: £2,000), on an arm's length basis were made
from J Margolis, mother of A Margolis who is a director of both Totally
Communications Limited and Totallyjewish.com Limited. A balance of £nil (2009:
£nil) is included in trade creditors at the year end.
During 2010, 32,424,153 warrants (2009: 9,080,633) and nil options (2009:
5,450,000) have been granted to D Assor. The exercise price is 1 pence per
option and 1 pence per warrant.
During 2010, 17,500,000 warrants (2009: 7,671,905) and nil options (2009:
5,125,000) have been granted to A Margolis. The exercise price is 1 pence per
option and 1 pence per warrant.
During 2010, 7,500,000 warrants (2009: Nil) have been granted to B Gritz, who
is a director of Totally Communications Limited. The exercise price is 1 pence
per warrant.
6. Dividend
The Directors do not propose the payment of a dividend.
7. Copies of Report and Accounts
Copies of the Report and Accounts have been posted to shareholders, are
available from the Company's registered office Unit 611 Highgate Studios, 53-79
Highgate Road, London NW5 1TL and are available from the Company's website
www.totallyplc.com.
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