Osprey Communications PLC
4 July 2001
OSPREY COMMUNICATIONS PLC ('Osprey' or 'the Company')
Preliminary Results for the year ended 31 March 2001
CHAIRMAN'S STATEMENT
I am pleased to report a successful conclusion to the funding exercise
undertaken earlier in the year. Continuing operations made an operating profit
of £271,000 in the year ended 31 March 2001, with trading in Osprey RMA and
Osprey Scotland being buoyant.
Osprey RMA once again had a most successful year showing an operating profit
of £506,000. Osprey Scotland made an operating profit for the year of £151,000
and ended the year with several significant client gains, which augurs well
for the coming year. Osprey Communications Plc costs before interest were £
386,000, much of which related to the aftermath of the Company's earlier
problems and the subsequent tidying up operation.
The discontinued operations made an operating loss of £737,000 in the period
up to their disposal, which showed a profit of £1,239,000 over the net assets
disposed of making a net contribution to profit of £502,000. FRS 10 requires
us to make a transfer from reserves of goodwill relating to the disposed
businesses which has already been written off against profit and loss account
reserves in earlier years, as an exceptional deduction in this year's profit
and loss account, although this has no effect on the Group's overall profit
and loss account reserves, shareholders' funds and cash flow. In order to show
the position without this book entry, we have provided an additional earnings
per share calculation to show the earnings per share before the goodwill write
off.
As a result of the funding exercise, the successful trading and the profit on
the disposal of the businesses, the Group's balance sheet has been restored
from a deficit on shareholders' funds of £2,425,000 to a positive balance of £
71,000, providing a stable base from which to move forward.
As you will see from the documentation being sent with this report, subject to
Shareholders' approval, the Company will be undergoing a major change which
will be of great importance to its Shareholders and to the future of the
Company. Following intensive discussions I am pleased to announce that Osprey
Communications will purchase the whole of the share capital of 10 Alps and
Instant Party for an initial consideration of 10,920,349 new ordinary shares
of 20p each; up to a further 2,428,077 shares will be made available if
specified gross profit levels are achieved.
10 Alps is a young, dynamic Company which combined with the Osprey agencies
will then be well positioned to meet the marketing and communication needs of
a wide range of clients.
Bob Geldof KBE and Alex Connock head up a most impressive team who will be
running the new enlarged group.
I am delighted that Brian Walden has agreed to become Non-Executive Chairman.
I feel sure his knowledge and experience particularly in the world of
television will be of enormous benefit to the future of the Company.
Alex Connock will be the new Chief Executive and he will be assisted by a
number of new Directors. Details of this and other important matters will be
found in the attached documentation.
I would now particularly like to thank the Management and staff of Osprey RMA
and Osprey Scotland for their total dedication and support. I would also like
to thank Munir Samji and Stephen Barclay who will be retiring following the
acquisition. Without their support it would have been impossible to survive
the earlier difficulties and bring the Company back into profitability.
Finally, I too will be resigning once I have ensured the successful hand-over
of the Company, and I would like to thank the Shareholders, many of whom have
been extremely loyal and patient.
I leave the Company in good hands.
JACK RUBINS
Chairman
4 July 2001
CONSOLIDATED PROFIT AND LOSS ACCOUNT
Year ended 31 March 2001 18
months
ended
Continuing Discontinued Total 31 March
Operations Operations 2000
£'000 £'000 £'000 £'000
Turnover 6,523 2,445 8,968 25,374
Cost of sales 4,267 1,314 5,581 16,231
_________ ____________ ______ ________
Gross profit 2,256 1,131 3,387 9,143
Administrative expenses 1,985 1,868 3,853 10,356
_________ ____________ ______ ________
Operating profit/(loss) 271 (737) (466) (1,213)
Profit on disposal of 1,239 1,239 -
Businesses
Goodwill previously written off to
reserves written back on disposal
(*see note below) (807) (807) -
_________ ____________ ______ ________
Profit/(loss) on ordinary activities 271 (305) (34) (1,213)
before interest
_________ ____________
Net interest payable (95) (176)
______ ________
Loss on ordinary activities before (129) (1,389)
tax
Tax charge - (1)
______ ________
Retained loss for the year (129) (1,390)
===== ========
Basic loss per share (0.13p) (2.31p)
===== ========
Earnings/(loss) per share before
restatement of goodwill
on businesses sold 0.68p (2.31p)
===== ========
*Note: Representing goodwill relating to disposed businesses, which was
previously written off to reserves, required by FRS 10 to be written back on
disposal and which has no effect on the overall profit and loss account
reserves, shareholders' funds and cash flow.
CONSOLIDATED BALANCE SHEET
31 March 2001 31 March 2000
£'000 £'000 £'000 £'000
Fixed assets
Intangible assets 80 -
Tangible assets 140 611
_________ _________
220 611
Current assets
Work in progress 34 197
Debtors 1,336 2,455
Bank 115 -
_________ _________
1,485 2,652
Creditors
Amounts falling due within one year (1,634) (5,688)
_________ _________
Net current liabilities (149) (3,036)
_________ _________
Net assets/(liabilities) 71 (2,425)
======== ========
Capital and reserves
Called up share capital 267 7,516
Share premium account 527 438
Profit and loss account (723) (10,379)
_________ _________
Equity shareholders' funds/ 71 (2,425)
(deficit)
======== ========
CONSOLIDATED CASH FLOW STATEMENT
Year ended 18 months
ended
31 March 2001 31 March 2000
£'000 £'000 £'000 £'000
Net cash (outflow)/inflow from operating (979) 457
activities
Return on investments and servicing of finance (95) (176)
Taxation - (68)
Capital expenditure and financial investment (49) (236)
Acquisitions and disposals 1,135 (10)
_________ _________
Net cash inflow/(outflow) before financing 12 (33)
Financing
Issue of ordinary share capital 1,101 -
Capital element of finance lease rentals (12) (27)
Loans (repaid)/received from directors (100) 150
Receipt of other loans - 300
_________ _________
Net cash inflow from financing 989 423
_________ _________
Increase in cash 1,001 390
======== =========
Reconciliation of net cash flow movement to
movement in net debt
Increase in cash in the period 1,001 390
Cash outflow/(inflow) from (increase)/decrease in
debt and lease financing
112 (423)
_________ _______
Change in net debt resulting from cash flows 1,113 (33)
Finance leases - (22)
Decrease in loans from non-cash items 717 -
_________ _________
1,830 (55)
Net (debt) at 1 April 2000 (1,715) (1,660)
_________ _________
Net funds/(debt) at 31 March 2001 115 (1,715)
======== =========
1. The results have been prepared under the historical cost convention and in
accordance with applicable accounting standards using accounting policies that
have been applied consistently.
2. The financial information set out above does not constitute the
Company's statutory accounts for the 12 month period ended 31 March 2001.
The information relating to the 18 month period ended 31 March 2000 has
been extracted from the 2000 Annual Report and Accounts which received an
unqualified auditors' report and have been delivered to the Registrar of
Companies.
3. The Report and Accounts for the period ended 31 March 2001 have been
prepared and will be mailed to shareholders today and further copies will
be available from York House, Empire Way, Wembley, Middlesex HA9 0PA.
4. The twentieth Annual General Meeting of Osprey Communications plc will
be held at 10.00 a.m. on 27 July 2001 at the offices of Bright Grahame
Murray, 124-130 Seymour Place, London W1H 1BG.
For further information please contact:
Osprey Communications plc 020 8795 4559
Jack Rubins
Munir Samji
Seymour Pierce Limited 020 7648 8700
Jonathan Wright
Jeremy Porter