Final Results
Huveaux PLC
07 March 2005
HUVEAUX PLC
Preliminary announcement of the final results
for the year ended 31 December 2004
HIGHLIGHTS
- Sales more than trebled to £14.4 million
- Pre-tax profit before exceptional items doubled to £2.45 million *
- Earnings per share before exceptional items up by 9 per cent *
- Dividend up by 14 per cent
- Cash of £3.1 million at year-end, and strong cash generation
- 3 acquisitions completed in 2004
The above highlights the underlying business performance of the Group. The
statutory results show the following financial results:
2004 2003
£'000 £'000
Turnover 14,433 4,575
Profit before taxation and exceptional items* 2,450 1,205
Profit before taxation 2,128 1,205
Earnings per share before exceptional items (basic)* 2.19p 2.01p
Earnings per share (basic) 1.94p 2.01p
Dividend per share 1.00p 0.88p
* Exceptional items amounted to £322,000 (before tax) relating principally to
the cost of restructuring the Parliamentary Communications Limited operations
acquired during 2004.
John van Kuffeler, Chairman of Huveaux PLC, commented:
'We are delighted that 2004 was a year of considerable growth for Huveaux, both
organically and through acquisition. Sales, profits and earnings per share have
all significantly increased.
We have invested in new offices in London to bring our UK Political Division
under one roof and this will generate significant benefits going forward.
Overall, the business has been transformed under a strengthened senior
management team and is in excellent shape. The outlook for 2005 is for another
year of growth.'
For further information, please contact:
John van Kuffeler, Huveaux PLC 020 7245 0270
Ann-marie Wilkinson/Geoff Callow, Bell Pottinger 020 7861 3232
CHAIRMAN'S STATEMENT
The year 2004 saw a further major transformation of Huveaux. We made three
acquisitions more than doubling our size and in addition achieved good organic
growth. As a result sales more than trebled from £4.6 million to £14.4 million
and pre-tax profits before exceptional items doubled to £2.45 million (2003 -
£1.20 million). Earnings per share before exceptional items increased by 9 per
cent to 2.2 pence (2003- 2.0 pence) and the Directors are recommending a
dividend of 1 pence per share (2003- 0.88 pence), an increase of 14 per cent
over 2003. Huveaux ended the year with a strong balance sheet, no borrowings and
£3.1 million of cash balances in the bank.
The exceptional item of £322,000 (2003- £nil) represents principally the cost of
restructuring the Parliamentary Communications Limited operations, including 18
redundancies, the day we completed that acquisition. After this exceptional
item, the pre-tax profit was £2.1 million (2003- £1.2 million).
The acquisitions in 2004 of Parliamentary Communications and Public Affairs News
have been fully integrated with Vacher Dod in the UK creating a very strong
market position in UK political publishing, with significant cost and revenue
benefits flowing through in 2005. Similarly, the operations of ATP- Egora have
been integrated into Le Trombinoscope in Paris with similar benefits flowing
through to 2005. In addition we have significantly strengthened our Board and
management team. Altogether, these measures have ensured a strong start to 2005.
Review of Operations
As at 31 December 2004 Huveaux's business comprised four operating units all in
the field of specialist B2B publishing. The sales and profits of each were as
follows for the year 2004:
Sales Pre-tax Profit*
£000 £000
UK Political 6,682 1,283
EU Political 2,213 335
---------- ------------
Total Political Division 8,895 1,618
---------- ------------
Fenman 2,875 466
Lonsdale 2,663 1,188
---------- ------------
Total Education & Training Division 5,538 1,654
---------- ------------
Operating Result 14,433 3,272
Head Office - (822)
---------- ------------
Sales/Pre-tax Profit 14,433 2,450
========== ============
* before exceptional items
Each of these is now described in turn.
Our UK Political Operation, Dod's Parliamentary Communications, is our largest
operating unit and is the leading political information, public affairs and
policy communication specialist in the UK. It comprises magazines, websites,
databases, reference books, seminars and events. Sales totalled £6.7 million in
2004, up from £1.5 million in 2003, with a large proportion of the increase from
the acquisitions made during the year. This Division is showing strong organic
growth with revenues increasing 16 per cent in 2004 on a like-for-like basis.
The costs in 2004 include the full costs of moving from four separate office
buildings to the new integrated office in Westminster Tower (including the costs
of the remainder of the old leases). The pre-tax profit before exceptional items
of this division amounted to £1.28 million.
Our magazines offer comprehensive editorial content from key decision makers who
influence, inform and educate- resulting in an essential read for those
interested in government, policy and the decision- making process. Regularly
highlighted in independent 'best read' research, our publications link the
political communities of the UK, allowing readers to keep abreast of
developments at all levels. Our magazines account for some 35 per cent of Dod's
Parliamentary Communications sales and comprise:
The House Magazine is the premier weekly publication for the Houses of
Parliament and those involved in politics and policy development.
The Parliamentary Monitor provides a monthly commentary on the big issues in the
political world, resulting in a respected insight into the current and
forthcoming agenda. In 2005 we have added The Regional Monitor, a month by month
analysis of the political issues around the regions of the UK.
Whitehall and Westminster World is a fortnightly newspaper for the civil
servants charged with developing, influencing and implementing policy in
Whitehall and Westminster.
Public Affairs News is Europe's leading monthly business publication dedicated
to those in the public affairs industry and government relations.
pH7 is the quarterly parliamentary health magazine for parliamentarians and
health policy makers to read and debate current issues.
The International Development Magazine is a new magazine which analyses issues
in the developing world. It is read by parliamentarians and leading figures
involved in development.
Our UK new media services comprise:
ePolitix.com is the highly regarded open access politics website with news,
policy bulletins, and a comprehensive legislation guide, as well as 420 MP and
250 specialist government relations websites. It has a monthly audience of
60,000 unique users and over 8,000 people read the daily email bulletins.
ePolitixlocal.com is the local government equivalent of ePolitix.com which was
launched in February 2005.
dodonline.co.uk is the UK's most authoritative online political intelligence
resource covering the people, institutions and constituencies in the UK. As
preferred supplier to the UK Parliament it delivers unrivalled real- time
information and search facilities based on the highly respected Dod's
Parliamentary Companion database.
ePolitixplus.com is a specialist information provider for political monitoring.
It delivers fast and accurate tailor- made political information to clients for
a fee, which varies according to the complexity of information required. The
number of clients grew from 30 to more than 100 during the year 2004.
The revenue from the above new media businesses account for some 25 per cent of
UK Political sales.
Our UK Political training and seminar business comprises:
Westminster Explained which offers high quality training and development
seminars to the public and private sector, facilitating a high standard of
performance and understanding in policymaking.
The Certificate in Public Sector Delivery which offers a high quality
professional training programme for people working in the civil service and the
public sector.
Westminster Briefing which offers political and policy specialists the rare
opportunity to hear about proposed government legislation and initiatives from
key parliamentary figures.
The revenue from the above training and seminar businesses account for some 22
per cent of UK political sales from over 100 events in 2004.
Our database and reference book business is dominated by Dod's Parliamentary
Companion and its accompanying titles, Dod's Civil Service Companion, Dod's
Constituency Guide, Dod's Scotland, Wales and Northern Ireland Companion, VQ,
and the Dod's Handbooks of Parliamentary Procedures. The revenue from these
publications account for some 15 per cent of UK political sales.
Electus is the leading search and selection consultancy for the public affairs
and political communications industry. The revenue from this business account
for some 3 per cent of UK political sales, after sales more than doubled in
2004.
The outlook for 2005 is for continued good growth in sales with the cost and
operational benefits of the new building flowing through. Our budgets for 2005
are based upon a May General Election, but an autumn poll date could have an
influence on the Division's results for 2005.
Our EU Political Operation, based in Paris and Brussels, had sales of £2.2
million in 2004, a like-for-like increase of 19 per cent over 2003. It consists
of:
• Le Trombinoscope (two reference books, a newsletter, a subscription
website and the prestigious 'Prix du Trombinoscope' political awards) which
had sales growth of 9 per cent in 2004;
• Parliament Magazine, published fortnightly, reports and reflects upon
the work of the European Parliament, and the European Commission as well as
upon broader European issues, which achieved a phenomenal 46 per cent sales
growth over the equivalent period last year;
• EUPolitix.com which has seen stable revenues since being acquired by
Huveaux, and has turned a £ 364,000 loss pre-acquisition into a small pre-tax
profit;
• ATP - Egora acquired in 2004 (which consists of four quarterly
specialist medical magazines under the brand 'Reseaux' and a website for
professionals in the French healthcare sector) which similarly saw stable
revenues but saw increased profits under our ownership with a contribution of
approximately €70,000 (£48,000) in the four months post - acquisition.
Overall, the EU Political Operation achieved pre-tax profits of £335,000 in
2004.
Our operations in Paris, comprising the separate businesses of Le Trombinoscope
and ATP - Egora, have recently moved into new premises together, enabling
further operational benefits to accrue.
Parliament Magazine and EUPolitix.com are both run from our Brussels office
which is opposite the European Commission building.
Eurosource, which is the title for the new database and reference books and
subscription website on the EU Parliament and the EU Commission (which combines
the former Dod's and Trombinoscope databases) achieved sales of approximately
£249,000 in 2004, all of which were deferred to 2005 pending the delivery to
customers of Volume II. This postponement arose as a direct result of the EU
Parliament rejecting the proposed EU Commission in October. Sales in 2004 were
therefore £ nil as compared to £184,000 on a like-for-like basis in 2003.
Overall, the EU Political Operation should see continued strong growth in 2005
combined with the benefit of the Eurosource sales being deferred from 2004 to
2005.
The Education & Training Division consists of Fenman and Lonsdale.
Fenman is a specialist publisher of material for training managers in both the
public and private sectors, including larger companies, government departments,
local authorities, the armed forces and large accounting firms. Its flagship
product is a monthly publication, The Training Journal, which has some 5,000
annual subscribers. Fenman also makes and sells a wide range of training videos
and publishes 108 different training manuals. In addition, it runs seminars and
courses for training managers at locations throughout the UK, and operates a
website for training managers with over 2,000 subscribers. Fenman is based in
Ely, Cambridgeshire and has 16 employees.
Fenman had sales of approximately £ 2.9 million in 2004 as compared to £ 0.7
million in 2003 (part year only), but on a like-for-like basis, sales were 2 per
cent lower. Pre-tax profits were £466,000 (2003 - £184,000 part year only). This
was a disappointing result reflecting a slowing of manual and video sales (down
13 per cent) counterbalanced by 8 per cent growth in Training Journal revenues
and a 48 per cent growth in seminar revenues (on a like-for-like basis in each
case). Immediate action has been taken to address these points:-
•Production of the Training Journal is being moved to London to be
produced alongside our other magazine titles with consequent cost savings
and the benefit of a large advertising sales department.
•The Fenman seminars business will be given the added expertise of our
large London political conference and training unit and further expansion of
this high growth business is planned for 2005.
•The manual and video business will reduce its heavy direct marketing
spend which will be replaced by a small sales unit targeting high value
customers, particularly the larger Government departments.
The outlook for 2005 for Fenman is therefore for a resumption of modest sales
growth.
Lonsdale is a specialist publisher of revision guides and workbooks for schools
in England and Wales. It specialises in Key Stages 2, 3 and 4, including GCSE
(for pupils between the ages of 7 and 16) and has 63 current titles. Sales are
made directly to schools and are priced at between £1 and £4. The guides are
designed to assist teachers to ensure that their pupils receive the exact
material on which they will be assessed. Lonsdale is based in Holmfirth,
Yorkshire; and Carnforth and Penrith in the Lake District. It has 18 employees.
Lonsdale achieved sales of approximately £ 2.66 million in 2004, as compared to
£2.5 million on a like-for-like basis in 2003, representing sales growth of 6
per cent. Pre-tax profits were approximately £1.19 million, which represents a
pre-tax profit margin of 44 per cent. A number of new titles were published
during the year, including six new maths titles published in November, and sales
have started strongly in 2005.
Group Financial
Head Office costs were £ 822,000 net of interest income which was in line with
expectations.
Huveaux ended the year with a strong balance sheet with no borrowings and
approximately £ 3.1 million cash in the bank. Cash generation was strong with
93 per cent of pre-tax profits being converted into cash during the year,
excluding deferred payments in respect of the Fenman and Lonsdale acquisitions
and the payment following exercise of options by the vendors of Parliamentary
Communications Limited.
Corporate Philosophy
Huveaux has the objective of building a substantial publishing and media group
over the next ten years. After three years of significant achievement, including
seven acquisitions, our corporate philosophy remains unchanged:
•Concentration on 'must-have' information businesses with strong market
positions
•Strong organic growth supplemented by carefully targeted acquisitions
•Increasing pre-tax profits and EPS each year
•All our businesses must be cash generating
•A progressive dividend policy
Staff
We now have approximately 190 employees, of whom approximately 160 are in the UK
and 30 are in Paris and Brussels. Our staff represent a valuable resource of the
Group, which through our acquisitions in 2004 has been strengthened by
significant sales and marketing, editorial and events management expertise.
During the year, we introduced two share incentive schemes to provide staff at
all levels with the opportunity to participate in share ownership of Huveaux.
Our staff have responded well to a period of rapid change. The Board would like
to thank all staff for their continued efforts and hard work, which have been so
important to the success of the Group.
Board and Management
During 2004 we continued the strengthening of our board. Kevin Hand, Gerry
Murray and Jean-Marie Simon were appointed directors in November, 2004. Five of
our eight directors are highly experienced publishers and three have served on
FTSE100 company boards. This gives us confidence that we have the management in
place to exploit the next phase of our growth.
2004 has been an active year, involving three acquisitions and significant
reorganisation and restructuring of the operations under our strengthened senior
management team. Gerry Murray now has responsibility for all our UK operations,
and Jean-Marie Simon heads our European political activities. Both have actively
integrated our acquisitions and positioned the businesses for growth. The
benefits of the actions taken this year are expected to flow through for years
to come.
Outlook
It is still early in the new financial year, but the results for January and
February are encouraging. We are concentrating on achieving strong organic
growth during the early months of the year to lay the sound foundations for a
successful year. We will also have the benefit of the full year contribution
from the three acquisitions made in 2004. In addition, the Board is continuing
to evaluate and negotiate acquisitions which meet its strict criteria. Overall
the outlook for 2005 is for continued significant growth, enhanced by the
expected UK General Election in May.
4 March 2005
CONSOLIDATED PROFIT AND LOSS ACCOUNT
for the year ended 31 December 2004
Note
2004 2003
£ 000s £ 000s
Turnover
Continuing operations 2 7,572 4,575
Acquisitions 2 6,861 -
-------- ---------
14,433 4,575
Cost of sales (6,872) (1,497)
-------- ---------
Gross profit 7,561 3,078
-------- ---------
Administrative expenses (5,217) (1,969)
Exceptional items 3 (322) -
-------- ---------
Total administrative expenses (5,539) (1,969)
-------- ---------
Continuing operations 2 1,281 1,109
Acquisitions 2 741 -
-------- ---------
Total operating profit 2,022 1,109
Other interest receivable and similar income 116 99
Interest payable and similar charges (10) (3)
-------- ---------
Profit on ordinary activities before taxation 2,128 1,205
Tax on profit on ordinary activities 4 (345) (250)
-------- ---------
Profit for the financial year 1,783 955
Dividends on equity shares 5 (1,065) (629)
-------- ---------
Retained profit for the year 718 326
======== =========
Adjusted basic earnings per share before exceptional
items 6 2.19 p 2.01 p
Earnings per share- basic 6 1.94 p 2.01 p
Earnings per share - diluted 6 1.92 p 2.01 p
The accompanying notes are an integral part of this consolidated profit and loss
account.
CONSOLIDATED BALANCE SHEET
At 31 December 2004
Note 2004 2003
£ 000s £ 000s
Fixed assets
Intangible assets 8 38,046 19,451
Tangible assets 800 515
-------- ---------
38,846 19,966
-------- ---------
Current assets
Stocks 1,329 841
Debtors 4,638 1,153
Cash at bank and in hand 3,120 3,710
-------- ---------
9,087 5,704
Creditors: Amounts falling due within one year (8,736) (2,901)
-------- ---------
Net current assets 351 2,803
-------- ---------
Total assets less current liabilities 39,197 22,769
Creditors: Amounts falling due after more than one
year (77) (1,162)
Provision for liabilities and charges - (22)
-------- ---------
Net assets 39,120 21,585
======== =========
Capital and reserves
Called-up equity share capital issued 9 10,646 7,146
Called-up equity share capital not issued 9 400 400
Share premium account 26,444 13,157
Merger reserve 409 409
Profit and loss account 1,221 473
-------- ---------
Equity shareholders' funds 39,120 21,585
======== =========
The accompanying notes are an integral part of this consolidated balance sheet.
These financial statements were approved by the board of directors and signed on
its behalf by:
John P de Blocq van Kuffeler David B Horne
Chairman Finance Director
4 March 2005
CONSOLIDATED CASH FLOW STATEMENT
for the year ended 31 December 2004
Note 2004 2003
£ 000s £ 000s
Reconciliation of operating profit to net cash flow
from operating activities
Operating profit 2,022 1,109
Depreciation charges 238 45
Increase in stocks (483) (106)
Increase in debtors (773) (258)
Decrease in creditors (108) (631)
-------- --------
Net cash inflow from operating activities 896 159
======== ========
Cash flow statement
Cash flow from operating activities 896 159
Returns on investments and servicing of finance 10 106 96
Taxation (49) -
Capital expenditure and financial investment 10 (309) (240)
Acquisitions and disposals 10 (17,122) (12,514)
Equity dividends paid (629) (155)
Management of liquid resources (47) -
-------- --------
Cash outflow before financing (17,154) (12,654)
Financing 10 16,787 14,763
-------- --------
(Decrease)/increase in cash for the year 11 (367) 2,109
======== ========
Notes to the preliminary announcement
31 December 2004
Note
1. Accounting policies
The financial statements have been prepared on the basis of the accounting
policies set out on pages 19, 20 and 21 of the Huveaux PLC Annual Report for
2003, which have been consistently applied, except that the Group now
capitalises development costs of new publications and other new products and
amortises them over periods between one and five years following the first
release of the new product for sale. The impact of these changes for the year
ended 31 December 2003 and net assets at that date is not material.
2. Segmental information
All amounts shown relate to one business segment, that of publishing.
Continuing
operations Acquisitions Total
2004 2004 2004 2003
£ 000s £ 000s £ 000s £ 000s
Group turnover by geographical
area
United Kingdom 6,645 5,580 12,225 4,060
Continental Europe & rest of world 927 1,281 2,208 515
--------- ---------- -------- --------
7,572 6,861 14,433 4,575
========= ========== ======== ========
Operating profit before
exceptional items by geographical
area
United Kingdom 1,182 614 1,796 889
Continental Europe & rest of the 99 127 226 220
world --------- ---------- -------- --------
1,281 741 2,022 1,109
========= ========== ======== ========
Net assets/(liabilities) by
geographical area
United Kingdom 38,553 (575) 37,978 21,459
Continental Europe 595 547 1,142 126
--------- ---------- -------- --------
39,148 (28) 39,120 21,585
========= ========== ======== ========
Head office operating costs of £917,000 (2003: £378,000) have been allocated to
operating profits on a pro rata basis.
Exceptional items of £322,000 (2003: nil) were incurred in respect of the United
Kingdom totaling £306,000 and Continental Europe & rest of the world totaling
£16,000.
3. Exceptional Items
2004
£ 000s
Wages and salaries 182
Social security costs 78
Legal fees 27
---------
Redundancy and people related costs 287
Provisions for vacant properties 35
---------
322
=========
Immediately following the acquisition of Parliamentary Communications Limited,
the Group carried out a significant cost reduction exercise in parts of that
business that were loss-making. 18 people left the Group and a property was
vacated. Following the integration of our UK Political Division into a single
location, 2 further properties were vacated. The exceptional charge for the
properties represents the costs incurred in vacating them and provisions for
future rental cost, net of expected rental income. There were no exceptional
items in the prior year.
4. Taxation
2004 2003
£ 000s £ 000s
UK corporation tax
Current tax on income for the period 272 46
Overaccrual in respect of prior periods (4) -
--------- ---------
268 46
Double taxation relief (5) -
Foreign tax
Current tax on income for the period 5 -
--------- ---------
Total current tax 268 46
Deferred tax
Origination and reversal of timing differences 371 275
Deferred tax asset on French losses (278) -
Impact of discounting (16) (71)
--------- ---------
Total deferred tax 77 204
--------- ---------
Tax on profit on ordinary activities 345 250
========= =========
5. Dividends
2004 2003
£ 000s £ 000s
Equity shares- Final dividend proposed 1.00p (2003: 0.88p) 1,065 629
========= =========
A final dividend of 1.00 pence per 10p Ordinary share (2003: 0.88 pence per 10p
Ordinary share) is recommended and, subject to approval by shareholders, will be
paid on 13 May 2005 to shareholders on the register as at 15 April 2005.
6. Earnings per Share
2004 2003
£ 000s £ 000s
Profit attributable to shareholders 1,783 955
Add: exceptional items (note 3) 322 -
Less: tax in respect of exceptional items (97) -
-------- ---------
Adjusted profit attributable to shareholders 2,008 955
======== =========
2004 2003
Shares Shares
Weighted average number of shares
In issue during the year - basic 91,737,954 47,473,307
Dilutive potential ordinary shares 1,179,162 -
-------- ---------
Diluted 92,917,116 47,473,307
======== =========
Adjusted basic earnings per share before exceptional
items (pence) 2.19 2.01
Earnings per share- basic (pence) 1.94 2.01
Earnings per share - diluted (pence) 1.92 2.01
7. Acquisitions
Each of the following acquisitions has been accounted for by the acquisition
method. An analysis of the book value and provisional fair value of the net
assets acquired on each is set out below. Publishing rights have, for each
acquisition, been valued to reflect their estimated fair values, and each
publication can be separately identified and valued.
a) Public Affairs Newsletter
On 5 March 2004 the Group acquired the assets and trade of the Public Affairs
Newsletter, a sole proprietorship, excluding the cash of the business.
The following table sets out the book values of the identifiable assets and
liabilities acquired and their provisional fair value to the group. All fair
values are provisional, awaiting final determination of the balances required.
Fair value
Book value adjustments Fair value
£ 000s £ 000s £ 000s
Publishing rights - 818 818
Debtors 85 - 85
Creditors (85) - (85)
--------- --------- ---------
Net assets acquired - 818 818
========= =========
Goodwill -
---------
Total consideration 818
=========
Satisfied by:
Cash paid 750
Acquisition costs 68
---------
818
=========
The summarised profit and loss account for the Public Affairs Newsletter for the
year ended 31 January 2004 is given below.
Year ended
31 January 2004
Unaudited
£000s
Turnover 199
=========
Profit before taxation 119
=========
b) Parliamentary Communications Limited
On 6 May 2004 the Group took effective control of Parliamentary Communications
Limited.
A number of loss-making activities (investments in and intercompany funding of
other business activities controlled by the vendors) and other assets and
liabilities were hived out of Parliamentary Communications Limited prior to
completion. The book value of these adjustments is as follows:
Book value
£ 000s
Tangible fixed assets 66
Fixed asset investments 588
Creditors (678)
---------
Net liabilities hived out (24)
=========
The following table sets out the book values of the identifiable assets and
liabilities acquired (after hive-out) and their provisional fair value to the
group. The adjustment to tangible fixed assets was made to reduce to zero the
net book value of software and leasehold improvements that are no longer used in
the operation. The adjustments to stock, deferred tax and creditors were made to
ensure consistency of accounting policies The fair value adjustment to debtors
reflects write-down to estimated realisable value. All fair values are
provisional, awaiting final determination of the balances required.
Book value Adjustment Fair value
£ 000s £ 000s £ 000s
Publishing rights 1 17,744 17,745
Tangible fixed assets 607 (439) 168
Stock 27 (11) 16
Debtors 1,730 (51) 1,679
Deferred tax 81 510 591
Creditors (3,037) (937) (3,974)
--------- --------- ---------
Net (liabilities)/ assets acquired (591) 16,816 16,225
========= =========
Goodwill -
---------
Total consideration 16,225
=========
Satisfied by
Cash paid 15,229
Deferred consideration 471
Acquisition costs 525
---------
16,225
=========
On the date of acquisition, an agreement was entered into for the simultaneous
creation and repurchase of a minority interest in the subsidiary. Subsequent to
6 May 2004, options over 9,009,009 ordinary shares of Parliamentary
Communications Limited were exercised and £450,000 was paid into that Company.
Huveaux PLC controlled 100% of the share capital throughout the post-acquisition
period.
The summarised consolidated profit and loss account for Parliamentary
Communications Limited for the year ended 30 June 2003 and the period from 1
July 2003 to 30 April 2004, both before hive-out as previously noted, is given
below:
Period ended Year ended
30 April 2004 30 June 2003
Unaudited Audited
£ 000s £ 000s
Turnover 6,836 7,980
---------- -----------
Operating profit/ (loss) 1,099 (437)
---------- -----------
Profit/ (loss) before taxation 452 (417)
Taxation (250) (271)
---------- -----------
Profit/ (loss) after tax 202 (688)
========== ===========
c) ATP Egora SA
On 1 September 2004 the group took effective control of ATP Egora SA.
The following table sets out the book values of the identifiable assets and
liabilities acquired and their provisional fair value to the group. The
adjustment to deferred tax was made to ensure consistency of accounting
policies. All fair values are provisional, awaiting final determination of the
balances required.
Book value Adjustments Fair value
£ 000s £ 000s £ 000s
Publishing rights - 1 1
Tangible fixed assets 33 - 33
Debtors 330 - 330
Deferred tax - 173 173
Cash at bank and in hand 238 - 238
Creditors (287) - (287)
---------- ---------- ---------
Net assets acquired 314 174 488
========== ==========
Goodwill -
---------
Total consideration 488
=========
Satisfied by:
Cash paid 341
Acquisition costs 147
---------
488
=========
The summarised consolidated profit and loss account for ATP Egora SA for the
year ended 31 December 2003 and the period from 1 January 2004 to 31 August 2004
is given below.
Period ended Year ended
31 August 31 December
2004 2003
Unaudited Audited
£ 000s £ 000s
Turnover 700 1,294
------------- -----------
Operating profit/ (loss) 45 (62)
------------- -----------
Profit/(loss) before taxation 19 (632)
Taxation - -
------------- -----------
Profit/(loss) after tax 19 (632)
============= ===========
8. Intangible fixed assets
Publishing rights
£000s
Cost & Net book value
At 1 January 2004 19,451
Additions 5
Additions through acquisition 18,564
Fair value adjustments 26
-------------
At 31 December 2004 38,046
=============
Additions to publishing rights of £5,000 are additional costs in respect of the
acquisition of Publications Professionnelles Parlementaires SAS and Fenman
Limited.
Fair value adjustments to publishing rights of £26,000 are in respect of changes
to the provisional fair values of Fenman Limited, as follows:
£000s
Stock (finished goods) 59
Creditors (accruals and deferred income) 28
Debtors (trade debtors) 4
Cost of sales (39)
Tangible fixed assets (additions through acquisition) (15)
Turnover (continuing operations) (11)
-------------
26
=============
The directors' impairment review of intangible assets used a discount rate of
10% in the net present value calculation of the carrying value.
9. Called-up share capital
Company 2004 2003
£ 000s £ 000s
Authorised:
Equity : 175,000,000 (2003: 120,000,000) ordinary shares of
10p each 17,500 12,000
======== ========
Allotted, called-up and fully paid:
Equity: 106,464,730 (2003: 71,464,730) ordinary shares of
10p each 10,646 7,146
======== ========
Equity shares to be issued 400 400
======== ========
During the year the company issued 35,000,000 ordinary shares of 10p each for
consideration of £3,500,000 and share premium of £13,287,000 net of expenses.
Shares to be issued of £400,000 relates to the settlement of contingent
consideration in relation to the acquisition of Lonsdale SRG in 2003.
Share options
The following options over 10p ordinary shares have been granted and are
outstanding at 31 December 2004 :
Number
of shares
of year
Unapproved Executive Share Option Scheme
Outstanding options at 1 January 2004 -
Granted during the year 3,136,925
----------
Outstanding options at 31 December 2004 3,136,925
==========
2004
Number Exercise Exercise
of shares price date
Outstanding options are
analysed as follows:
Granted in May 2004:
EMI options 878,000 65.0p May 2007-2014
Unapproved options 763,000 65.0p May 2007-2014
-------
1,641,000
Granted in November 2004:
Unapproved options 1,495,925 54.0p November 2007-2014
-------
1,495,925
-------
Outstanding options at 31
December 3,136,925
2004 =======
Comprising:
EMI options 878,000
Unapproved options 2,258,925
-------
Outstanding options 31
December 3,136,925
2004 =======
Number
of shares
Savings related share option
scheme
Outstanding options at 1 -
January 2004
Granted during the year 585,643
Lapsed during the year (6,228)
-------
Outstanding options at 31
December 2004 579,415
=======
2004
Number Exercise Exercise
of shares price date
Outstanding options analysed
as follows:
Granted in June 2004 145,605 52.5p July 2007-2009
Granted in September 2004 433,810 44.0p November 2007-2009
-------
Outstanding options at 31
December 579,415
2004 =======
10. Analysis of cash flows
2004 2003
£ 000s £ 000s
Returns on investment an servicing of finance
Interest and similar income received 116 99
Interest paid (10) (3)
========= ---------
106 96
========= =========
Capital expenditure and financial investment
Purchase of tangible fixed assets (304) (231)
Purchase of intangible fixed assets (5) (9)
--------- ---------
(309) (240)
========= =========
Acquisitions and disposals
Purchase of subsidiary undertakings and assets (17,060) (12,866)
Lonsdale deferred consideration paid (300) -
Cash acquired on acquisition of subsidiary 238 352
--------- ---------
(17,122) (12,514)
========= =========
Financing
Short term funding received - 1,380
Short term funding paid - (1,380)
Issue of Ordinary share capital 17,500 15,573
Expenses paid in connection with share issue (713) (810)
--------- ---------
16,787 14,763
========= =========
11. Analysis of net funds
At beginning Exchange At end
of year Cash flow movement of year
£ 000s £ 000s £ 000s
Cash at bank and in hand 3,710 (607) 17 3,120
Debt due within one year (240) 240 - -
---------- ---------- -------- ----------
3,470 (367) 17 3,120
========== ========== ======== ==========
12. Post balance sheet events
Payments totalling £1,100,000 of deferred consideration in respect of the
Lonsdale acquisition were settled in full on 16 February 2005.
A payment of £471,000 of deferred consideration in respect of the Parliamentary
Communications Limited acquisition was paid on 2 March 2005.
13. The financial information set out above does not constitute the company's
statutory accounts for the years ended 31 December 2004 or 2003 but is derived
from those accounts. Statutory accounts for 2003 have been delivered to the
registrar of companies, and those for 2004 will be delivered following the
company's annual general meeting. The auditors have reported on those accounts;
their reports were unqualified and did not contain statements under section 237
(2) or (3) of the Companies Act 1985.
This information is provided by RNS
The company news service from the London Stock Exchange
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