Final Results
Text 100 Group PLC
23 October 2000
'Continuing strong performance across the Group'
* Turnover up 60% to £36.4 million
* Pre-tax profit, before exceptionals, up 59% to £2.7 million.
* Strong organic growth overall with outstanding performances in the US
and from Bite and Joe Public Relations subsidiaries
* Eight new operations established internationally
* Proposed name change of group to 'OneMonday Group plc'
* Plans to float a small minority stake in subsidiary Bite Communications
Ltd on OFEX at end of 2001
* Strong start to new financial year
Tom Lewis, Chairman of Text 100 Group plc, the international technology pr
company, said: 'I am pleased to report a strong performance for our first full
year on the LSE. The growth has been entirely organic and I am delighted that
such strong profit growth has been achieved despite the substantial ongoing
early-stage investment we have been undertaking in new subsidiaries, expansion
of existing offices and operational infrastructure.
'The Group has made a good start to the new year, winning some significant
business. We expect that the market for technology related pr services will
continue to grow strongly.'
For further information, contact:
Tom Lewis, Chairman, Text 100 Group 020 8996 4100
David Dewhurst, Finance Director 020 8996 4100
Nick Denton, Hogarth Partnership 020 7357 9477
Preliminary Announcement of Results for the Year to 31 July 2000
Following our successful debut on the London Stock Exchange in December 1999,
it gives me great pleasure to report a powerful set of full-year figures for
your Company. During the year to 31 July 2000, turnover rose 60% to £36.4m,
while pre-tax profit grew 59% to £2.7m before exceptional flotation expenses.
Adjusted basic earnings per share was up 74% to 7.89p.The board is proposing a
dividend per share increase of 25% to 2p.
Two things are noteworthy about this performance. Firstly, the turnover
growth is 100% organic - meaning that it has come entirely from three sources
- increased spending from existing clients, new clients being won, and new
start-up operations being formed. Secondly, the profit growth has been
achieved in spite of substantial early-stage investment in new subsidiaries,
expansion of existing offices, investment in operational infrastructure and
the new staff required to sustain the rate of growth in turnover.
During the year, the Group's subsidiaries established eight new operations in
locations as diverse as Hong Kong (Text 100), London, Sydney and Auckland
(AUGUST.ONE), San Francisco (Bite) and Cape Town (extra PR). Some of the
turnover growth was quite outstanding, with Text 100's US operations showing
growth of 115%, while Bite grew by 65% and Joe Public Relations by 121%.
AUGUST.ONE also enjoyed a successful first year of operations.
In a move that's designed to emphasise that the Group is a collection of 8
separate brands, comprising 41 profit centres worldwide and more than 600
staff - the board is proposing to change the Company's name to OneMonday Group
plc. The new name highlights our emphasis on organic growth, and reflects
that our new operations are almost invariably start-ups, which open their
doors for business on a Monday. Assuming that the new name is approved by
the Group's shareholders at the EGM on 15 November 2000, it is anticipated
that it will become effective on 16 November 2000.
In conjunction with the name change, the Company is also changing its main
board structure. On 1 January 2001, the Group will reduce the size of its
main board from 10 to 5. Responsibility for many brand level operational
matters will be delegated to a larger Executive Council. The new Group main
board will consist of Tim Dyson (Group CEO), David Dewhurst (Group FD) and
myself, as well as the Group's non-executive directors Ian Taylor and Brendan
Magee. Aedhmar Hynes, Matthew Ravden and Carlo Crighton will step down from
the Group board but will join the Executive Council and remain directors of
Text 100 International. Andrew West and Sandeep Kalsi will step down from the
Group board at the same time. Also joining the Executive Council, which will
be chaired by the Group CEO, are the CEOs of Bite, AUGUST.ONE and Joe Public
Relations as well as the Group FD.
The Company's strategy of separate brand development is further evidenced by
medium-term plans for its subsidiary Bite Communications Ltd. Bite has grown
and developed strongly since its formation in 1995. Assuming continued growth
and stock market and other conditions permitting, the Group hopes to float a
small minority stake in Bite - probably no more than 5% - on the OFEX trading
facility or another junior market in or about November 2001. This move will
be motivating for Bite staff, enabling them to hold share options in a quoted
rather than a private company.
The board is delighted with the strong performance of the Company's share
price since its flotation on the LSE in December 1999 and as a result the
board has decided to recommend the split of the Company's 5p shares into units
of 2.5p, which should improve liquidity. This matter will be presented for
approval at the next AGM in January 2001.
The Group board wishes to announce two appointments to the board of its Text
100 International subsidiary. One of the Group's non-executive directors, Ian
Taylor MBE, MP takes on the new role of chairman while another Group director,
Aedhmar Hynes, has been appointed CEO in place of Tim Dyson, who is now free
to concentrate on the development of all the Group's brands in his role as
Group CEO.
The board expects that the market for its technology-related PR services will
continue to grow strongly. The Group has made a good start to the new year and
has already won some significant new business during the first quarter. Bite
has been appointed to run a significant campaign for BT in connection with its
3G mobile phone licence and Text 100 in London has won technology-related
assignments from Channel 5 and Barclays Bank. At the same time, the Group has
established new Text 100 operations in New York and Palo Alto (Silicon Valley)
while the Joe Public Relations brand has established its first subsidiary
operation, Joe Public Future. As a result, the board is confident that the
Group will continue to make good progress in the coming year.
Finally, I'd like to say a few words to my colleagues all over the world - so
many of whom are also shareholders and option holders. The Group's performance
over the first year as a listed company has been a class act, and I
congratulate you all on an outstanding performance.
Yours faithfully,
Chairman
20 October 2000
TEXT 100 GROUP PLC
CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 JULY 2000
Year ended Year ended
31 July 2000 31 July 1999
(UNAUDITED) (AUDITED)
£'000 £'000
TURNOVER (Note 3) 36,440 22,771
Other external charges (6,404) (3,882)
TURNOVER LESS OTHER EXTERNAL CHARGES 30,036 18,889
Staff costs (17,978) (11,027)
Depreciation (1,031) (653)
Other operating charges:
Exceptional Flotation Costs (Note 4) 434 -
Other operating charges 8,137 5,412
(8,571)
(5,412)
2,456 1,797
OPERATING PROFIT
Interest receivable and similar income 22 14
Interest payable and similar charges (212) (111)
PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION 2,266 1,700
Tax on profit on ordinary activities (Note 5) (1,078) (801)
PROFIT ON ORDINARY ACTIVITIES AFTER TAXATION 1,188 899
MINORITY INTERESTS (69) (46)
PROFIT ATTRIBUTABLE TO MEMBERS 1,119 853
OF THE HOLDING COMPANY
Equity dividends paid and proposed (Note 6) (397) (309)
RETAINED PROFIT FOR THE 722 544
FINANCIAL YEAR
BASIC EARNINGS PER SHARE (Note 7) 5.75p 4.52p
DILUTED EARNINGS PER SHARE (Note 7) 5.35p 4.35p
ADJUSTED EARNINGS PER SHARE (Note 7) 7.89P 4.52p
The profit and loss account for the year ended 31 July 2000 and the preceding
year relate to the continuing activities of the Group.
TEXT 100 GROUP PLC
CONSOLIDATED BALANCE SHEET
AS AT 31 JULY 2000
2000 1999
(UNAUDITED) (AUDITED)
£'000 £'000
FIXED ASSETS
Tangible assets 3,262 1,741
Investments 1,523 1,509
4,785 3,250
CURRENT ASSETS
Debtors 9,014 6,469
Cash at bank and in hand 1,802 562
10,816 7,031
CREDITORS - Amounts falling due within
one year (8,331) (5,538)
NET CURRENT ASSETS 2,485 1,493
TOTAL ASSETS LESS CURRENT LIABILITIES 7,270 4,743
CREDITORS - Amounts falling due after
more than one year (606) (409)
PROVISIONS FOR LIABILITES AND CHARGES - Deferred - (22)
tax
NET ASSETS 6,664 4,312
EQUITY CAPITAL AND RESERVES
Called up share capital 1,121 1,071
Share premium account 2,711 1,162
Profit and loss account 2,750 2,009
6,582 4,242
TOTAL EQUITY SHAREHOLDERS' FUNDS
MINORITY INTERESTS 82 70
6,664 4,312
TEXT 100 GROUP PLC
CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 31 JULY 2000
2000 1999
£'000 £'000
NET CASH INFLOW FROM
OPERATING ACTIVITIES (Note 8 (1)) 2,522 2,225
RETURNS ON INVESTMENTS
AND SERVICING OF FINANCE
Interest received 22 13
Interest paid (212) (111)
Minority interest dividends paid (18) (7)
NET CASH OUTFLOW FROM RETURNS ON INVESTMENTS
AND
SERVICING OF FINANCE (208) (105)
NET CASH OUTFLOW FROM TAXATION
Corporation tax paid (1,093) (604)
CAPITAL EXPENDITURE AND
INVESTING ACTIVITIES
Payments for long term deposits (73) (52)
Payments to purchase own shares (75) (200)
Payments to acquire tangible fixed assets (2,757) (1,102)
Proceeds from sale of own shares 11 -
Receipts from sales of tangible fixed assets 233 112
NET CASH OUTFLOW FROM CAPITAL EXPENDITURE AND
INVESTING
ACTIVITIES (2,661) (1,242)
EQUITY DIVIDENDS PAID (185) (306)
NET CASH OUTFLOW BEFORE
FINANCING (Note 8 (3)) (1,625) (32)
FINANCING
Issue of ordinary share capital 1,599 -
New bank loan 631 -
Net capital outflow on hire purchase contracts (121) 297
NET CASH INFLOW FROM FINANCING 2,109 297
INCREASE IN CASH FOR THE YEAR (Note 8 (3)) 484 265
1) FINANCIAL INFORMATION
The financial information set out in the announcement does not constitute the
company's statutory accounts for the years ended 31 July 2000 or 1999. The
financial information for the year ended 31 July 1999 is derived from the
statutory accounts for that year which have been delivered to the Registrar of
Companies. The auditors reported on those accounts; their report was
unqualified and did not contain a statement under s237(2) or (3) Companies Act
1985. The statutory accounts for the year ended 31 July 2000 will be finalised
on the basis of the financial information presented by the directors in this
preliminary announcement and will be delivered to the Registrar of Companies
following the company's annual general meeting.
2) CHANGE OF ACCOUNTING POLICY
There has been a change of accounting policy in relation to exchange rates. In
order to increase accuracy of reporting for the profit and loss report only,
an average rate has been used for the period ended 31 July 2000. In previous
accounts reported, the period closing rate has been used as is used in balance
sheet reporting. The Directors do not consider that this change has had a
material effect on the reported profit and therefore the comparatives have not
been restated.
This announcement has been prepared on the basis of the accounting policies as
stated in the financial statements for the year ended 31 July 1999, except as
noted above.
3) SEGMENTAL INFORMATION
Analysis of turnover, profit before taxation and net assets by geographic
origin and destination.
Year ended 31 July 2000 Year ended 31 July 1999
(UNAUDITED) (AUDITED)
Turnover Profit Net Turnover Profit Net
before assets before assets
taxation taxation
£'000 £'000 £'000 £'000 £'000 £'000
Europe, 25,832 1,307 4,834 18,450 1,261 3,813
Middle
East &
Africa
North 7,790 984 865 3,481 705 537
America
Asia 2,818 (25) 965 840 (266) (38)
Pacific
36,440 2,266 6,664 22,771 1,700 4,312
The turnover relates to one class of business.
The directors consider these regions to be separate geographic markets and the
markets within which the group operates.
4) EXCEPTIONAL FLOTATION COSTS
Exceptional flotation costs of £535k represent the fees and related expenses
incurred in the process of obtaining a listing on the London Stock Exchange.
Of these, £101k has been netted against share premium in accordance with
section 130 of the Companies Act 1985 (as amended).
5) TAX ON PROFIT ON ORDINARY ACTIVITIES
2000 1999
(UNAUDITED) (AUDITED)
£'000 £'000
UK corporation tax at 30% (1999: 30.67%) on the results 247 339
for the year
Overseas taxation 869 495
Prior year (over) provision (16) (55)
Deferred taxation (22) 22
1,078 801
6) DIVIDENDS
An interim dividend of 0.6p per share has been paid for the year and a final
dividend of 1.4p per share is proposed, making a total for the year of 2.0p
(1999:1.6p). This final dividend will be paid on 1 February 2001 to
shareholders who are on the register at 3 November 2000, assuming shareholder
approval at the AGM in January 2001.
7) EARNINGS PER SHARE
Earnings per share has been calculated in accordance with FRS14, using
earnings of £1,119k (1999: £853k) and the weighted average number of shares in
issue of 19,460,799 (1999: 18,845,187). Diluted earnings per share has also
been calculated on the weighted average number of shares in issue, as adjusted
by dilutive potential ordinary shares, of 20,923,395 (1999: 19,582,528).
The adjusted earnings per share have been calculated by adding £417k of
flotation costs after tax to the Profit attributable to members of £1,119k.
8) NOTES TO THE CASH FLOW STATEMENT
(1) Reconciliation of operating profit to net cash inflow from operating
activities
2000 1999
£'000 £'000
Operating profit 2,456 1,797
Depreciation 1,031 653
Profit on sale of own shares (11) -
Exchange movements - 7
Profit on sale of tangible fixed assets (30) (84)
Increase in debtors (2,444) (1,461)
Increase in creditors 1,556 1,313
Increase in investments (14) -
Decrease in provisions (22) -
Net cash inflow from operating activities 2,522 2,225
(2) Analysis of changes in net funds during the year
31 July Cash flows Other Exchange 31 July
1999 changes movement 2000
£'000 £'000 £'000 £'000 £'000
Cash at bank and in 562 1,224 - 16 1,802
hand
Bank overdraft (477) (740) - (1) (1,218)
85 484 - 15 584
Bank loans (200) (631) - - (831)
Hire purchase (463) 148 (27) (4) (346)
contracts
Net funds (578) 1 (27) 11 (593)
(3) Reconciliation of net cash flow to movement in net funds
2000 1999
£'000 £'000
Increase in cash at bank and in hand in the year 1,224 216
Cash (outflow)/inflow from increase in bank overdraft (740) 49
Increase in cash for the year 484 265
Cash inflow from bank loan (631) -
Net cash outflow/(inflow) from hire purchase contracts 148 (268)
Changes in net funds from cash flows 1 (3)
Interest element of hire purchase contract payments (27) (29)
Exchange movement 11 -
Movement in net debt in the year (15) (32)
Net debt at 1 August 1999 (578) (546)
Net debt at 31 July 2000 (593) (578)