Interim Results
Ingenta PLC
15 May 2001
Date: Embargoed until 07.00, Tuesday 15th May 2001
Contacts: ingenta Website: www.ingenta.com
Martyn Rose, Chairman (On 15th May) 020 7796 4133
Mark Rowse, Chief Executive Thereafter: 01865 314810
David Callcott, Finance Director 01225 361020
Hudson Sandler
Alistair Mackinnon-Musson Tel: 020 7796 4133
Philip Dennis email: ingenta@hspr.co.uk
Meetings: Presentations for analysts and press will be held today at
10.30am and 11.45am respectively. For further information,
please contact Hudson Sandler on 020 7796 4133.
ingenta plc
Interim Results
ingenta plc, global market leader in the online distribution of published
scientific, professional and academic research, today announces interim
results for the 6 months to 31st March 2001.
Highlights
* Turnover increased by 294% to £4.6m (2000: £1.2m)
* Gross profits up 348% to £3.5m (2000: £0.8m)
* Gross margin up from 67% to 76%
* Cash balances at 31st March 2001 were £8.6m (30th September 2000:
£7.7m)
* Trading for the current year comfortably in line with expectations
* Current projections indicate ingenta is on target to become
profitable and cash generative by the end of 2001
Commenting on the results, Martyn Rose, Chairman, said:
'The company continues to demonstrate that it can deliver growth that is both
rapid and sustainable, supporting management's view that the $6bn industry in
which it operates is unaffected by prospects of a global slowdown. Management
has continued to build on its market leading position in both the UK and the
US following the acquisition of CatchWord, and is firmly on course to continue
its significant growth rate. With the company's cost base now established,
further growth in sales is set to feed through rapidly into profits, on
schedule late this year.'
Mark Rowse, Chief Executive, added:
'The company now provides access to over 4,500 publications, representing over
two-thirds of the material currently online in this sector. With under 10
percent of the world's scientific, professional and academic research yet
available online, the scope for further growth is substantial.'
Notes to Editors
ingenta is the global market leader in online distribution of published
scientific, professional and academic research. It provides an online search
service of published content from reliable research sources not freely
searchable elsewhere on the Web and is one of the UK's top 5 Web service
operators, serving over 3 million visitors a month.
For publishers of scientific, professional and academic periodicals, journals
and reference works, it provides a suite of services including data
conversion, secure online hosting, subscription authentication, marketing and
e-commerce services. As well as providing Web users with a broad based article
search and delivery service through www.ingenta.com, ingenta also develops
subject-focused e-communities, built in conjunction with societies and
publishers, and enterprise portal solutions for libraries.
ingenta's revenue streams derive both from fees paid by publishers, such as
Reed Elsevier Educational Publishing, Nature Publishing Group and Taylor &
Francis Group, and from a share of pay per view and subscription revenues from
users paying to download articles or subscribing to e-communities it operates
such as www.animalscience.com or www.nutritiongate.com.
e25, the definitive index of the UK's top 25 Internet businesses from leading
business magazine Management Today and business consultancy Bain & Company,
placed ingenta in the number 3 spot in its March 2001 edition, and US-based
InfoWorld has named ingenta as one of its top 100 'e-businesses to watch'.
Interim Results Statement
The Directors are pleased to present their interim report for the six months
ended 31st March 2001.
During the six months to 31st March 2001 the Company's activities continued to
show strong dynamic growth. ingenta achieved rapid increases in sales in all
its core business areas while the acquisition of CatchWord reinforced its
leading position in the market. The customer base continues to expand rapidly
and now includes over 160 publishers and societies, including 8 of the world's
largest 10 journal publishers and 2 of the top 3 reference publishers.
Overall usage of ingenta's sites increased to over 3.2 million visits in
March, compared with some 750,000 in September 2000. Penetration of the higher
value corporate market has increased markedly and the company's user base now
includes 20 of the FTSE 100 and 93 of the Fortune 500 companies.
Financial and operational review
During the period, turnover increased by 294% to £4.6m (2000: £1.2m). The
results include a contribution from CatchWord from 1st February 2001, which
represents some 15% of the Company's growth in the period. Gross profits were
up by 348% to £3.5m (2000: £0.8m). Gross margins increased markedly from 66.6%
to 75.7%, reflecting the scalability of the business and positive benefits of
operational gearing as the company grows. Net operating losses before
interest, depreciation, amortisation and exceptional items, and after fully
providing for software development costs of £1.7m, were £3.7m (2000: £1.4m).
Revenues continue to demonstrate rapid month on month growth, with March
providing ingenta's first £1million month.
Publisher services
The acquisition of CatchWord has enabled ingenta to strengthen further its
proposition to publishers with the company now offering a complete suite of
electronic publishing and distribution solutions to publishers of all sizes.
In addition, the acquisition, together with rapid organic growth, has resulted
in the number of publishers and societies working with ingenta at the end of
the period exceeding 150, compared with 80 six months earlier, with a further
9 new customers in April alone. The number of online publications accessible
from within www.ingenta.com now exceeds 3,600, with over 1,000 more titles
contracted and in production. This represents over two-thirds of all the
publications currently online in this sector. With under 10 percent of the
world's scientific, professional and academic research yet available online,
the scope for further growth is substantial.
ingenta.com
The ingenta.com and catchword.com web services are being progressively merged,
starting with the loading of the CatchWord content into ingenta.com, which now
includes over 1.4 million articles. This has contributed to rapid growth in
usage with over 650,000 articles downloaded in March, a 56% increase over the
previous month and 451% above the previous year.
e-communities
The Company's e-communities business continues to grow rapidly. The number of
e-communities (specialised websites providing subject-focused content and
services to niche groups of users) has doubled over the last 6 months to 35
now live on the web with a further 20 in development, in addition to around
150 portals tailored specifically to the needs of individual libraries. Of
particular note were the first of a series of sites launched during the period
for Macmillan (www.ency-astro.com and www.els.net), and Reed Educational
Publishing (www.heinemannexploreprim.com)
Operations
Integration of the CatchWord acquisition has progressed rapidly since its
acquisition and the businesses are expected to be fully integrated by July
2001. The management team has been further strengthened by the appointment of
Simon Dessain as Chief Technology Officer and Andrea Keyhani as Chief
Operating Officer, reinforcing ingenta's capacity to sustain the rapid growth
of the past six months.
Principally as a result of the CatchWord acquisition, the number of staff grew
to 236 at 31st March compared with 168 at the September 2000 year end. The
Board is confident that this overall level of staffing will be broadly
sufficient to sustain the Group's plans for continued growth.
To have managed and integrated the acquisition of a major competitor while
continuing to produce rapid and accelerating organic growth is a very
considerable achievement. The staff and management at every level should be
proud of what has been achieved and on the Board's behalf we would like to
thank everyone for their dedication and effort.
Current trading and outlook
As shown in these results, ingenta continues to demonstrate dynamic growth and
scalability. All its revenue streams are growing and demand for its services
is increasing. The critical mass and broad service offering achieved by the
acquisitions has enabled the company to develop its position more rapidly in
its fast growing market place, building on a base of strong organic growth.
Since the year end, the company has continued to move ahead strongly with
current trading levels continuing to show substantial growth in revenues and
gross profits against comparables for the preceding year. With over £9.2m of
revenue for the year ending 30th September 2001 already either contracted or
expected as repeat business, and with a substantial pipeline of further
orders, management is confident that the outcome for the year will be
comfortably in line with expectations.
Finally, given the strong forward visibility in trading referred to above,
along with a reduction in software development and marketing costs during the
year, the outlook is extremely encouraging and the Board is confident that
profitability and cash generation will be achieved on schedule in late 2001.
Martyn Rose Mark Rowse
Chairman Chief Executive
15th May 2001
Consolidated Profit and Loss Account
for the 6 months ended 31 March 2001
6 months 6 months Year ended
ended ended
30
31 March 31 March September
2001 2000 2000
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
Turnover 4,649 1,181 4,319
Cost of sales (1,130) (395) (1,232)
Gross profit 3,519 786 3,087
Operating expenses
Technical Services (1,695) (506) (1,728)
Software Development (1,660) (537) (1,168)
Sales & Marketing Expenses (2,532) (597) (2,008)
Other Administration Costs (1,332) (510) (1,247)
Loss before interest, tax, depreciation, (3,700) (1,364) (3,064)
amortisation and exceptional items
Depreciation (433) (132) (318)
Integration costs (1,503) - (469)
National insurance on share options 83 - (196)
Goodwill amortisation (1,902) (672) (1,467)
Goodwill write-off - - (15,637)
Total operating expenses (10,974) (2,954) (24,238)
Operating loss (7,455) (2,168) (21,151)
Share of operating profit / (loss) in joint 2 - (1)
venture
Total operating loss: group and share of (7,453) (2,168) (21,152)
joint venture
Net interest receivable / (payable) 190 (6) 195
Loss on ordinary activities before taxation (7,263) (2,174) (20,957)
Tax on loss on ordinary activities 2 - 312
Loss for the financial period (7,261) (2,174) (20,645)
Loss and diluted loss per share (14p) (7p) (52p)
Loss and diluted loss per share before (10p) (5p) (9p)
goodwill amortisation and write off
The results for the periods above are derived entirely from continuing
operations.
Consolidated Balance Sheet
as at 31 March 2001
As at 31 As at 31 As at 30
March March September
2001 2000 2000
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
Fixed Assets
Intangible assets 23,257 5,086 8,059
Tangible assets 2,531 618 1,718
Interests in joint ventures 34 - 32
25,822 5,704 9,809
Current assets
Debtors: amounts falling due within one 2,381 695 2,029
year
Cash at bank and in hand 8,626 5,442 7,718
11,007 6,137 9,747
Creditors: amounts falling due within (7,912) (4,475) (6,764)
one year
Net current assets 3,095 1,662 2,983
Total assets less current liabilities 28,917 7,366 12,792
Creditors: amounts falling due after (325) (180) (319)
more than one year
Provisions for liabilities and charges (87) - (170)
Net assets 28,505 7,186 12,303
Capital and reserves
Called up share capital 2,741 13 2,373
Shares to be issued 5,500 314 313
Share premium account 10,215 9,991 3,194
Merger reserve 11,055 - -
Reverse acquisition reserve 12,680 - 12,679
Profit and loss account (13,686) (3,132) (6,256)
Equity shareholders' funds 28,505 7,186 12,303
Consolidated Cash Flow Statement
for the 6 months ended 31 March 2001
6 months 6 months Year ended
ended ended
30 September
31 March 31 March 2000
2001 2000
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
Cash flow from continuing operating
activities
Operating loss (7,455) (2,168) (21,151)
Depreciation charge 433 132 318
Write-off of goodwill - - 15,637
Amortisation of goodwill 1,902 672 1,467
Decrease in stocks - - 7
(Increase) / Decrease in debtors 683 183 (465)
Increase / (Decrease) in creditors 691 (150) 380
Increase / (Decrease) in provisions (83) - 170
Net cash outflow from operating activities (3,829) (1,331) (3,637)
Returns on investments and servicing of
finance
Net interest received / (paid) 190 (6) 191
Tax paid (98) - (28)
Capital expenditure and financial
investments
Purchase of tangible fixed assets (756) (83) (309)
Sale of tangible fixed assets - - 2,951
Net cash (outflow) / inflow from (1,342) (312) 2,332
acquisitions
Net cash (outflow) / inflow before (5,835) (1,732) 1,500
financing
Financing
Issue of shares at a premium 6,862 7,165 9,977
Take up of cash alternative to offer by - - (3,711)
Delyn Group plc
Repayment of principal under finance (119) 9 (41)
leases
Net cash inflow from financing 6,743 7,174 6,225
Increase in cash in the period 908 5,442 7,725
Statement of group total recognised gains and losses
for the 6 months ended 31 March 2001
6 months 6 months Year ended
ended ended
30 September
31 March 31 March 2000
2001 2000
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
Loss for the financial period (7,261) (2,174) (20,645)
Currency translation differences on foreign (169) - (288)
currency net investments
Total recognised losses for the period (7,430) (2,174) (20,933)
Notes to the Unaudited Interim Report
for the 6 months ended 31 March 2001
1 Basis of preparation
The Interim Financial Information has been prepared on the basis of the
accounting policies set out in the Group's Annual Report and Accounts for the
year ended 30 September 2000. The acquisition of ingenta UK Ltd by ingenta plc
(previously named Delyn Group plc) in the prior year is treated as a reverse
acquisition and reflected in the accounts as if ingenta UK Ltd acquired
ingenta plc. Therefore, the comparative figures presented in the Interim
Financial Information are those of ingenta UK Limited and its subsidiaries for
the 6 months to 31 March 2000 and not ingenta plc.
2 Reconciliation of reported share capital in the consolidated
balance sheet
£'000
Allotted, called up and fully paid share capital of ingenta plc 2,373
at 1 October 2000
Issue of 2,500,000 ordinary shares for cash on 4 October 2000 125
Shares issued on exercise of share options during the period 7
Shares issued in exchange for shares in Catchword Ltd on 8 February 2001 214
Shares issued on 1 March 2001 as deferred consideration for the 22
acquisition of Uncover inc in prior year
Allotted, called up and fully paid share capital of ingenta plc 2,741
at 31 March 2001
3 Publication of Non-Statutory Accounts
The financial information contained in this interim report is unaudited and
has not been reviewed by the auditors. It does not constitute statutory
accounts as defined in section 240 of the Companies Act 1985. The comparative
financial information for the 6 months ended 31 March 2000 was neither audited
nor reviewed by the auditors. Statutory accounts for the year ended 30
September 2000 incorporating an unqualified audit report have been filed with
the Registrar of Companies.
4 Basis of EPS Calculation
The basic loss per share has been calculated by dividing the loss for the
period by the weighted number of ordinary shares of 51,251,121 (6 months ended
31 March 2000: 33,084,700; year ended 30 September 2000: 39,428,804) in issue
during the 6 month period to 31 March 2001. The company had no dilutive
ordinary shares in any of the periods and there is therefore no difference
between the loss per ordinary share and the diluted loss per ordinary share.
Supplementary basic and diluted EPS have been calculated to exclude the effect
of goodwill amortisation and write-off in respect of subsidiaries and
businesses acquired and in respect of the goodwill arising on the reverse
acquisition of ingenta plc. The supplementary figures have been calculated by
dividing the loss for the financial period excluding goodwill amortisation and
write off, by the weighted average number of shares, as described above.
ENDS
Latest directors dealings
- 10 hours ago Origin Enterprises (CDI)
- 10 hours ago Origin Enterprises (CDI)
- 11 hours ago SSP Group
- 12 hours ago Latham (James)
- 12 hours ago LSL Property Services