Half Yearly Report

RNS Number : 7715W

Dods (Group) PLC

12 November 2014

 



12 November 2014

Dods (Group) PLC

Interim Results for the six months ended 30 September 2014

Financial Highlights

•           Revenues £8.4m (2013: £9.3m) decrease of 9.3%.

•           Gross Profit £2.1m (2013: £2.0m).

•           Gross profit margin increased from 22.0% to 24.8%.

•           Loss before tax £1.2m (2013: £1.1m).

•           Adjusted EBITDA loss of £54,000 (2013: profit £28,000).

Operational Highlights

•           Continued growth of information and intelligence products.

•           All UK Monitoring customers have been migrated to the new technology platform.

•           Through the Government's new event framework agreement we were awarded the annual National Health Service Expo.

Cheryl Jones, Chairman of Dods (Group) PLC, commented:

"The Group's interim results reflect trading in line with management's expectations. The Group's priorities include; to reposition Dods' resources enabling further product and service innovation, to realign market-facing activities for greater effectiveness, to leverage the investment in technology and improve the Group's overall structural efficiencies.  We will keep our shareholders and the wider market appropriately updated to these transformational plans."

For further information, please contact:

Cenkos

Nicholas Wells                                                020 7397 8920           

Business Review

The first half of the financial year saw group revenues reduced by 9.3% from £9.3 million to £8.4 million. The corresponding improved margins, from 22% to 24.8%, reflect early progress made in focussing on quality revenues.

Much of this focus was on our events portfolio with a planned re-modelling of Civil Service Live seeing revenues reduced by £0.4m. Further planned reductions in our events portfolio were seen across both our Westminster and Brussels operations. The impact of the referendum in Scotland saw revenues from the Holyrood business decline by £0.2m

Continued emphasis on recurring digital subscriptions saw revenues increase across our UK and EU monitoring businesses by 8.5% and 16.6% respectively. All our UK monitoring clients have now been migrated over to the new platform and all new trials of our service is based on this new technology. We are receiving positive feedback on these trials and will benefit from improved service levels to our customers.

I am pleased to announce we were one of 15 companies to be placed on the Government's framework for the awarding of events on behalf of Government. Our first submission on the framework resulted in us being appointed to run the NHS's Expo on a three year contract. This is a commercial opportunity where the economic benefit and risk resides with the Company. We believe this will be a long term success for us.

Outlook

We continue to be in a period of transition but are seeing the benefits of our early initiatives. We are currently trading in line with management's expectations.

Martin Beck

Chief Executive Director

DODS (GROUP) PLC
CONSOLIDATED  INCOME STATEMENT

									For the six		For the six		For the year
									months ended		months ended		ended
									30 September		30 September		31 March
									2014		2013		2014
									Unaudited		Unaudited		Audited
								Note	£'000		£'000		£'000
Revenue								3	8,442		9,332		19,775
Cost of sales									(6,352)		(7,283)		(13,934)
Gross profit									2,090		2,049		5,841
Administrative expenses:
Non-trading items								4	(75)		(89)		(485)
Amortisation of intangible assets and assets acquired
through business combinations									(418)		(514)		(1,026)
Amortisation of intangible assets									(578)		(375)		(803)
Depreciation									(58)		(114)		(225)
Net administrative expenses									(2,144)		(2,021)		(4,754)
Total administrative expenses									(3,273)		(3,113)		(7,293)
Operating loss									(1,183)		(1,064)		(1,452)
Finance income									17		7		11
Financing costs									(17)		-		(47)
Loss before tax									(1,183)		(1,057)		(1,488)
Income tax credit								5	76		120		199
Loss for the period									(1,107)		(937)		(1,289)
Loss per share
Basic								6	(0.33 p)		(0.34 p)		(0.38 p)

	CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
			For the six	For the six		For the year
			months ended	months ended		months ended
			30 September	30 September		31 March
			2014	2013		2013
			Unaudited	Unaudited		Audited
			£'000	£'000		£'000
Loss for the period			(1,107)	(937)		(1,289)
Items that will be subsequently reclassified to profit and loss
Exchange differences recognised on disposal of discontinued operations			(7)	(5)		(10)
Other comprehensive (loss)/income for the period			(7)	(5)		(10)
Total comprehensive loss in the period
attributable to equity holders of parent company			(1,114)	(942)		(1,299)

DODS (GROUP) PLC
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
			As at		As at		As at
			30 September		30 September		31 March
			2014		2013		2014
			Unaudited		Unaudited		Audited
		Note	£'000		£'000		£'000
	Goodwill	7	13,282		13,336		13,282
	Intangible assets	8	13,622		14,714		14,332
	Property, plant and equipment		457		529		471
	Non-current assets		27,361		28,579		28,085
	Inventories		109		137		124
	Trade and other receivables		3,528		3,746		3,759
	Cash		4,843		5,611		5,291
	Income tax receivable		(3)		37		-
	Current assets		8,477		9,531		9,174
	Income tax payable		-		-		(39)
	Trade and other payables		(6,624)		(6,550)		(6,790)
	Current liabilities		(6,624)		(6,550)		(6,829)
	Net current assets		1,853		2,981		2,345
	Total assets less current liabilities		29,214		31,560		30,430
	Contingent deferred consideration		-		(564)		-
	Deferred tax liability		(1,025)		(1,317)		(1,100)
	Non current liabilities		(1,025)		(1,881)		(1,100)
	Net assets		28,189		29,679		29,330
	Equity attributable to equity holders of parent
	Issued capital		17,078		17,078		17,078
	Share premium		8,009		8,009		8,009
	Other reserves		409		409		409
	Retained profit		2,253		3,725		3,367
	Share option reserve		471		463		471
	Translation reserve		(31)		(5)		(4)
	Total equity		28,189		29,679		29,330

DODS (GROUP) PLC
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
		Unaudited	Unaudited	Unaudited	Unaudited	Unaudited	Unaudited	Total
		Share	Share	Merger	Retained	Translation	Share option	shareholders'
		capital	premium	reserve	earnings	reserve	reserve	funds
		£'000	£'000	£'000	£'000	£'000	£'000	£'000
	At 1 April 2013	17,078	8,009	409	5,129	(4)	0	30,621
	Reclassification	-	-	-	(473)	10	463	-
	Total comprehensive loss
	Loss for the year	-	-	-	(1,289)	-		(1,289)
	Other comprehensive loss
	Currency translation differences					(10)		(10)
	Transactions with owners
	Share based payment	-	-	-	-	-	8	8
	At 1 April 2014	17,078	8,009	409	3,367	(4)	471	29,330
	Total comprehensive loss
	Loss for the year	-	-	-	(1,107)	-		(1,107)
	Other comprehensive loss
	Currency translation differences	-	-	-	(7)	(27)		(34)
	At 30 September 2014	17,078	8,009	409	2,253	(31)	471	28,189

DODS (GROUP) PLC
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
				For the six		For the six		For the year
				months ended		months ended		months ended
				30 September		30 September		31 March
				2014		2013		2014
				Unaudited		Unaudited		Audited
			Note	£'000		£'000		£'000
	Cash flows from operating activities
	Loss for the period			(1,107)		(937)		(1,289)
	Depreciation of property, plant and equipment			58		114		225
	Amortisation of intangible assets acquired through business combinations			418		514		1,026
	Amortisation of other intangible assets			578		375		803
	Share based payments credit			-		-		8
	Net finance costs			-		(7)		36
	Income tax credit			(76)		(120)		(199)
	Operating cash flows before movements in
	working capital			(129)		(61)		610
	Change in inventories			(13)		21		34
	Change in receivables			282		(1,005)		(1,022)
	Change in payables			(202)		655		904
	Cash generated by operations			(62)		(390)		526
	Income tax paid			(36)		(63)		(87)
	Net cash used in operating activities			(98)		(453)		439
	Cash flows from investing activities
	Interest and similar income received			17		7		11
	Acquisition of subsidiaries, net of cash acquired			-		-		(564)
	Addition to property, plant and equipment			(38)		(70)		(123)
	Additions to intangible assets			(291)		(904)		(1,462)
	Net cash used in investing activities			(312)		(967)		(2,138)
	Cash flows from financing activities
	Interest and similar expenses paid			(4)		(3)		(12)
	Net cash from financing activities			(4)		(3)		(12)
	Net (decrease)/increase in cash and cash equivalents			(414)		(1,423)		(1,711)
	Opening cash and cash equivalents			5,291		7,037		7,037
	Effect of exchange rate fluctuations on cash held			(34)		(3)		(35)
	Closing cash and cash equivalents		9	4,843		5,611		5,291

DODS (GROUP) PLC                                                                                                                                                                            

Notes to the Accounts                                                                                                                                                       

30 September 2014                                                                                                                                                             

1     Statement of Accounting Policies                                                                                                                            

       The interim financial statements have been prepared in accordance with the recognition and measurement principles of IFRSs as adopted by the EU, applying the accounting policies and presentation that were applied in the preparation of the Company's published consolidated financial statements for the year ended 31 March 2014.                                                                                                                                               

       Basis of preparation                                                                                                                                                   

The Board continuously assesses and monitors the key risks of the business.  Despite the current uncertainty in the global economy, the key risks that could affect the Group's medium term performance, and the factors which mitigate these risks have not significantly changed from those set out in the Group's Financial Report for the 12 months ended 31 March 2014.  The Operating Review includes consideration of uncertainties affecting the Group in the remaining six months of the year.  The Board has reviewed forecasts and remains satisfied with the Group's funding and liquidity position.  On the basis of its forecasts and available facilities and cash balances held on the balance sheet, the Board has concluded that the going concern basis of preparation continues to be appropriate.                                                                           

2     Statement of compliance                                                                                                                                           

This condensed set of financial statements has been prepared in accordance with IAS 34: Interim Financial Reporting as adopted by the EU.  The annual financial statements of the Group are prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the EU.  As required by AIM Rules, the condensed set of financial statements has been prepared applying the accounting policies and presentation that were applied in the preparation of the company's published consolidated financial statements for the year-ended 31 March 2014.

The comparative figures for the year ended 31 March 2014 are not the company's statutory accounts for that financial period.  Those accounts have been reported on by the company's auditor and delivered to the registrar of companies.  The report of the auditor was (i) unqualified, (ii) did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying their report, and (iii) did not contain a statement under section 498(2) or (3) of the Companies Act 2006.                                                                                             

3     Segmental information                                                                                                                                              

Segment information is presented in respect of the Group's operating segments.  The operating segments have been identified on the basis of internal reports about components of the Group that are regularly reviewed by the "chief operation decision maker" to allocate resources to the segments and to assess their performance.                                                                                                                                                  

		Six months ended		Six months ended		12 months ended
		30 September		30 September		31 March
		2014		2013		2014
		Unaudited		Unaudited		Unaudited
Revenue		£'000		£'000		£'000
Political		8,442		9,332		19,775
Total revenue		8,442		9,332		19,775
Revenue
United Kingdom		6,337		7,349		15,674
Continental Europe and rest of the world		2,105		1,983		4,101
		8,442		9,332		19,775

		Six months ended		Six months ended		12 months ended
		30 September		30 September		31 March
		2014		2013		2014
		Unaudited		Unaudited		Unaudited
EBITDA from operations*		£'000		£'000		£'000
Political		421		397		1,456
Head Office		(475)		(369)		(369)
Total EBITDA		(54)		28		1,087

*EBITDA is defined by the Directors as being earnings before interest, tax, depreciation, amortisation of intangible assets acquire through business combinations, and non-trading items.                                                                                                                                 

Non-trading items
				Six months ended		Six months ended		12 months ended
				30 September		30 September		31 March
				2014		2013		2014
				Unaudited		Unaudited		Audited
				£'000		£'000		£'000
Redundancy and people related costs				-		45		294
Abortive deal costs				-		30		25
Acquisition costs				-		14		14
Consultancy fees				75		-		152
				75		89		485

5     Taxation                                                                                                                                                                        

       The taxation charge for the six months ended 30 September 2014 is based on the expected annual tax rate.                                          

6	Adjusted (loss)/profit attributable to shareholders post tax
			Six months ended		Six months ended		12 months ended
			30 September		30 September		31 March
			2014		2013		2014
			Unaudited		Unaudited		Audited
			£'000		£'000		£'000
	Loss attributable to shareholders		(1,107)		(937)		(1,289)
	Add: non-trading items net of tax		57		68		471
	Add: amortisation of intangible assets acquired
	through business combinations		418		514		1,026
	Less: share based payment credit		-		-		8
	Adjusted loss attributable to shareholders		(632)		(355)		216

			Shares		Shares		Shares
	Weighted average number of shares
	In issue at start of the period - ordinary shares		339,770,953		273,263,601		339,770,953
	In issue at 30 September - ordinary shares		339,770,953		273,263,601		339,770,953
	Loss per share - ordinary shares (pence)		(0.33)		(0.34)		(0.38)
	Adjusted (loss)/earnings per ordinary share before
	non-trading items and amortisation of intangible assets
	acquired through business combinations (pence)		(0.19)		(0.13)		0.67

Since the Group is loss making, there is no dilutive impact of the share options.                                                                                                                                                                  

On 7 February 2012 each existing ordinary share of 10p in the authorised share capital of the company was subdivided into 1 ordinary shares of 1p each and 1 deferred shares of 9p each.

The 1p ordinary shares have the same rights (including voting and dividend rights and rights on a return of capital)                as the previous 10p ordinary shares.  Holders of the 9p deferred shares confer no right to any dividend or any other distribution (other than on a winding up), confer no right to receive notice of, or to attend or vote at, general meetings of the Company, and on a winding up confer the rights to be paid out of the assets of the Company available for distribution an amount equal to 1p for all the deferred shares prior to the surplus being distributed to the holders of ordinary shares, but do not confer any right to participate in any surplus assets of the Company, the Company shall not be obliged to issue share certificates in respect of the deferred shares.                            

On 5 April 2012, Dods (Group) PLC issued and allotted 76,950,944 ordinary shares which were admitted to trading on 5 April 2012.                     

On 25 July 2012, Dods (Group) PLC announced that it was proposing to raise approximately £6.1 million (before expenses) by the issue of 110,821,556 new Ordinary Shares ("Placing Shares") at a price of 5.5 pence each (the "Placing") to Lord Ashcroft KCMG.                                    

7	Goodwill
							Six months ended		Six months ended		12 months ended
							30 Sept		30 Sept		31 March
							2014		2013		2014
							Unaudited		Unaudited		Audited
							£'000		£'000		£'000
	Cost & net book value
	Opening balance						13,282		13,282		19,393
	Additions						-		54		782
	Impairment						-		-		(6,893)
	Closing balance						13,282		13,336		13,282

8	Intangible fixed assets
										Six months ended		Six months ended		12 months ended
										30 Sept		30 Sept		31 March
										2014		2013		2014
										Unaudited		Unaudited		Audited
	Intangible assets acquired through business combinations									£'000		£'000		£'000
	Cost
	Opening balance									24,215		24,215		24,215
	Additions									-		182		-
	Closing balance									24,215		24,397		24,215
	Amortisation
	Opening balance									12,166		11,140		11,140
	Charge for the period									418		514		1,026
	Closing balance									12,584		11,654		12,166
	Net book value
	Opening balance									12,049		13,075		13,075
	Closing balance									11,631		12,743		12,049
	Other intangible assets
	Net book value
	Opening balance									2,283		1,624		1,624
	Closing balance									1,991		1,971		2,283
	Net intangible assets
	Opening balance									14,332		14,699		14,699
	Closing balance									13,622		14,714		14,332

9	Analysis of net funds
							At							Exchange		At
							1 April 2014			Cash flow				movement		30 September 2014
							£'000			£'000				£'000		£'000
	Cash at bank and in hand						5,291			(414)				(34)		4,843
							5,291			(414)				(34)		4,843

RESPONSIBILITY STATEMENT OF THE DIRECTORS IN RESPECT OF THE HALF YEAR REPORT

We confirm that to the best of our knowledge:

1.     the condensed set of financial statements has been prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the EU.

2.             the interim management report includes a fair review of the information required by:

(a)   DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and

(b)   DTR 4.2.8R of the Disclosure and Transparency Rules, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the entity during that period; and any changes in the related party transactions described in the last annual report that could do so.

By order of the Board of Dods (Group) PLC

Keith Sadler

Company Secretary

 

END

 

 

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