TIDMTENG
RNS Number : 4574Y
Ten Lifestyle Group PLC
13 May 2021
13 May 2021
Ten Lifestyle Group plc
("Ten", the "Company" or the "Group")
Interim results for the six months ended 28 February 2021
Ten Lifestyle Group plc (AIM: TENG), a leading
technology-enabled global concierge platform for the world's
wealthy and mass affluent, announces its unaudited Interim Results
for the six months ended 28 February 2021 ("H1 2021", or "the
period").
Financial Highlights
-- Net Revenue (1) GBP17.2m, GBP6.6m down due to the effects of
COVID-19 (28% lower than H1 2020: GBP23.8m, which was the last
period before international lock-downs took effect)
o Corporate revenue of GBP15.5m (25% lower than H1 2020:
GBP20.5m)
o Supplier revenue of GBP0.9m (66% lower than H1 2020:
GBP2.5m)
-- Reduced operating expenses of GBP15.5m (H1 2020: GBP21.7m),
as a result of continued efficiencies as well as participation in
government funded COVID-19 initiatives
-- Adjusted EBITDA (2) of GBP1.7m (H1 2020: GBP2.1m) and
improved Adjusted EBITDA margin (3) of 9.8% (H1 2020: 8.7%)
-- Loss before tax of GBP(3.6)m (H1 2020: GBP(3.3)m)
-- Cash and cash equivalents of GBP9.2m (H1 2020: GBP9.6m) and
GBP1.0m of long-term debt (USA) (H1 2020: GBPnil)
Operational Highlights
-- Key contract renewals, expansion of certain existing contracts and won new contracts
-- Healthy pipeline of potential new contracts in all three global regions
-- Continued investment in proprietary digital platforms,
communications and technologies, GBP5.5m (H1 2020: GBP5.9m)
-- Operating efficiency continues to improve largely due to
digital transformation, including three quarters of requests now
fully or partially automated compared with half of requests in H1
2020
-- Digital platform launched with new brands and into new geographic markets
-- Record Member satisfaction (4) due to continued improvements to the member proposition
Alex Cheatle, CEO of Ten Lifestyle Group, said;
"Revenue from corporate clients was reduced due to the pandemic
but remained at healthy levels because we continued to provide
value to members. Supplier revenue, predominantly from
travel-related commissions, remained subdued, whilst travel is
restricted globally. Despite lower revenues, the growth engine
within the Ten model helped us to remain EBITDA profitable, with
improved margin, whilst achieving record service levels in the
period and continuing the digital transformation of our
business.
Our improving proposition and efficiency, along with our strong
pipeline of new contract opportunities and the gradual return of
demand for our core services, means we are well positioned to
continue our momentum as the impact of the COVID-19 pandemic
eases."
Analyst Presentation
An online analyst presentation will be held by video link at
9:00am on 13 May 2021. To attend, please email
investorrelations@tengroup.com .
Dial-in details for the presentation are also available:
Dial-in number: +44 208 080 6592
Meeting ID: 874 2243 8399
The Group will also be presenting an Investor Webinar for
current and prospective investors at 5:30pm on 17 May 2021. If you
would like to attend, please email investorrelations@tengroup.com
.
For further information please visit www.tenlifestylegroup.com
or call:
Ten Lifestyle Group plc
Alex Cheatle, Chief Executive Officer +44 (0)20 7850
Alan Donald, Chief Financial Officer 2796
Peel Hunt LLP, Nominated Advisor and Broker
Edward Knight
Paul Gillam +44 (0) 20 7418
Nick Prowting 8900
Chief Executive's Review
The severe impact of the COVID pandemic has reduced Net Revenue
due to lower revenue from suppliers (5) and demand for Ten's core
propositions in the dining, travel and live entertainment
categories being severely reduced. However, the growth engine at
the heart of Ten's business model has enabled us to continue to
make progress towards our strategic aim of becoming the world's
most trusted service.
Despite lower revenue, improving efficiencies have led to
improved Adjusted EBITDA margin percentage and allowed the business
to maintain investment into our digital transformation and deliver
improvements to Ten's member proposition; readying Ten for growth
once the effects of COVID-19 ease by region.
Strengthened member proposition, satisfaction and engagement
During the period, we strengthened Ten's member proposition with
better access and benefits for our members. Examples of this
include, we have increased the number of contracted hotels,
airlines and retail offers available on the platform.
In addition, we have developed new services that are attractive
to our members. These include high-end home deliveries and virtual
events with top chefs, leading authors and well-known
personalities. We have also increased the production and range of
our in-house content, showcasing the knowledge, access and value of
the concierge service to our members in multiple languages. These
improvements have helped achieve record levels of member
satisfaction in the period, as measured by NPS.
Continued investment in technology
Our investment in the continued digital transformation of the
business means that around one fifth of requests were fully
automated compared to a modest level in the prior half year. In
addition, around three quarters of requests were serviced using
full or partial automation, up from around half in the same period
last year. The continued digital transformation of the business
improves service quality and efficiency.
Improved efficiencies and cost control have allowed us to
maintain a healthy cash position and positive EBITDA despite lower
revenues and continued discretionary investment in technology.
Our People
Our colleagues have continued to respond very well to the
challenges of the pandemic and secure home working has been a
success. We continued to develop our talent through our Global
Leadership Programme, invested into global Diversity, Equity and
Inclusion initiatives and we improved our internal communications.
This was reflected in the record scores achieved in the recent
annual all employee engagement survey.
Corporate client developments
We enjoy continued support from our corporate clients by
delivering valued services to improve their customer acquisition,
retention and profitability. We believe we have continued to build
competitive advantage, anchored by Ten's market-leading digital
platform and technology capabilities, and the improved Return on
Investment (ROI) that we believe we deliver for our corporate
partners.
Our improved proposition, technology and committed colleagues
were key to Ten retaining all of the corporate client contracts
that came up for renewal during the period and since the period
end. Of our 23 Medium, Large and Extra Large contracts(6) , we
renewed one Extra Large contract, three Large contracts, two Medium
contracts in the period.
Although the wider effects of COVID-19 continue to limit the
signing of new contracts, our sales pipeline is robust and we have
secured some important new mandates from new and existing corporate
clients during the period and since the period end. These include a
new Small contract as well as mandates to expand two Extra Large
contracts and a Medium contract.
Outlook and Trading since the end of the half year
Request volumes and the resulting Net Revenue since the end of
the half year remain below prior year due to the effects of
COVID-19 on Ten's core propositions in the dining, travel and live
entertainment categories.
Monthly levels of inbound requests, a lead indicator of
improving demand, have increased since the end of the half year
period, as travel and social restrictions slowly ease in EMEA and
North America; where we expect revenue from our long-standing and
new corporate client contracts to start to improve. In addition,
supplier revenue continues to demonstrate significant improvement
since the end of the half year period, as the impact of the
pandemic on international travel in these regions start to ease.
The timing of a recovery in Latin America remains uncertain and in
APAC the level of international travel is expected to remain low
until restrictions are eased.
Further easing of restrictions in all regions is expected to
benefit our pipeline of potential new business and also allow us to
restart our expansion into new verticals.
We expect ongoing improvements in servicing, content and
efficiencies to continue to generate Adjusted EBITDA in line with
the Board's expectations. We also expect to retain a healthy cash
position, albeit generating a net cash outflow in the second half
of the year, whilst we continue to invest in technology to further
drive the growth engine.
We believe the improvements made to the member proposition leave
Ten well positioned to increase Net Revenue and profitability as
the pandemic eases and develop its share of the huge dining, travel
and live entertainment markets (7) for our target group of HNW and
mass affluent individuals.
Alex Cheatle
Group Chief Executive Officer
12 May 2021
(1) Net Revenue excludes the direct cost of sales relating to
certain member transactions managed by the Group.
(2) Adjusted EBITDA is operating (loss)/profit before interest,
taxation, depreciation, amortisation, share-based payments and
exceptional items.
(3) Adjusted EBITDA margin is Adjusted EBITDA as a percentage of
Net Revenue.
(4) Ten measures member satisfaction using the Net Promoter
Score management tool, which gauges the loyalty of a firm's
customer relationships
(https://en.wikipedia.org/wiki/Net_Promoter).
(5) Ten's revenue from its supplier base, such as hotels,
airlines, and event promoters which sometimes pay commission to Ten
constituted 12% of Net Revenue for the 2019 financial year (as
reported in the 2019 Annual Report and Accounts) and 7% of Net
Revenue for the 2020 financial year (as reported in the 2020 Annual
Report and Accounts).
(6) Ten categorises its corporate client contracts based on the
annualised value paid, or expected to be paid, by the corporate
client for the provision of concierge and related services by Ten
as: Small contracts (below GBP0.25m); Medium contracts (between
GBP0.25m and GBP2m); Large contracts (between GBP2m and GBP5m); and
Extra Large contracts (over GBP5m). This does not include the
revenue generated from suppliers through the provision of concierge
services.
(7) As described on pages 20 & 21 of the 2020 Annual Report
and Accounts.
Operating and Financial Review
GBPm H1 2021 H1 2020
Revenue 17.5 25.6
-------- --------
Net Revenue 17.2 23.8
-------- --------
Operating expenses & other income (excluding depreciation,
amortisation, share based payments and exceptional
items) (15.5) (21.7)
-------- --------
Adjusted EBITDA* 1.7 2.1
-------- --------
Adjusted EBITDA % of Net Revenue 9.8% 8.7%
-------- --------
Depreciation (1.8) (2.3)
-------- --------
Amortisation (1.9) (1.4)
-------- --------
Share-based payments charge and exceptional items
charge (1.2) (0.5)
-------- --------
Operating loss before interest and tax (3.2) (2.1)
-------- --------
Net finance expense (0.4) (1.2)
-------- --------
Loss before taxation (3.6) (3.3)
-------- --------
Taxation charge (0.3) (0.4)
-------- --------
Loss for the period (3.9) (3.7)
-------- --------
Revenue
Revenue for the six months to 28(th) February 2021 was GBP17.5m,
32% lower than the six months to 29(th) February 2020, which was
the last period before international lock-downs took effect. Net
Revenue which is our key revenue measure was GBP17.2m, down 28%
compared to the prior period and 16% below that generated in the
previous 6 months of GBP20.5m.
This revenue decline reflected the impact of the COVID-19
pandemic.
Development of corporate contracts
Contracts by Launched by 28 Expected to be
size February 2021 launched by 31
August 2021
Extra Large 3 3
--------------- ----------------
Large 5 6
--------------- ----------------
Medium 15 14
--------------- ----------------
Total 23 23
--------------- ----------------
New business wins of Medium, Large and Extra Large contracts was
subdued in the period. Secured a Medium contract in APAC and, as
previously reported, the contract loss related to a Large contract
which transitioned from a corporate to an affiliate contract model
from September 2020.
Operating expenses & other income (excluding depreciation,
amortisation, share based payments and exceptional items)
Operating expenses of GBP15.5m (H1 2020: GBP21.7m) reduced by
GBP6.2m, as a result of continued operational efficiencies,
government funded COVID-19 initiatives in various countries and
other cost saving initiatives throughout the period, including
several salary sacrifice schemes, to mitigate the impact of
COVID-19.
Adjusted EBITDA
Adjusted EBITDA, as reported, takes into account all Group
operating costs, other than depreciation of GBP1.8m (H1 2020:
GBP2.3m), amortisation of GBP1.9m (H1 2020: GBP1.4m), share-based
payment expenses of GBP0.8m (H1 2020: GBP0.5m) and an exceptional
charge for the impairment of intangibles of GBP0.4m (H1 2020: nil).
On this basis, Adjusted EBITDA was a profit of GBP1.7m (H1 2020:
GBP2.1m).
Depreciation has declined by GBP0.5m, primarily due to a
reduction in Right-of-use Asset (lower lease costs). Amortisation
increased by GBP0.5m, reflecting our continued technology
investment. Share-based payment expenses increased by GBP0.3m, due
to the salary sacrifice for share options schemes in the period.
The exceptional items expense of GBP0.4m related to a further
review of a database previously capitalised that was less likely to
generate future economic benefit, due to the effects of the
COVID-19 pandemic on this content.
Net Finance Expense fell by GBP0.8m, due to a reduction in
foreign-exchange translation differences in the income
statement.
Regional performance
Segmental Net Revenue reporting reflects our servicing location
rather than the location of our corporate clients. This allows us
to understand and track the efficiency and profitability of our
operations around the world.
GBPm H1 2021 H1 2020 % change
EMEA 8.7 11.9 (27%)
-------- -------- ---------
Americas 5.0 7.7 (35%)
-------- -------- ---------
APAC 3.5 4.2 (17%)
-------- -------- ---------
Total 17.2 23.8 (28%)
-------- -------- ---------
After fully allocating our indirect central costs including IT,
platform support, non-lease costs and management across the
regions, the Adjusted EBITDA profitability of each regional segment
is:
GBPm H1 2021 H1 2020
EMEA 3.0 3.9
-------- --------
Americas (1.7) (1.5)
-------- --------
APAC 0.4 (0.3)
-------- --------
Total 1.7 2.1
-------- --------
Adjusted EBITDA % of Net
Revenue 9.8% 8.7%
-------- --------
EMEA
Net Revenue in the region decreased by 27% to GBP8.7m (H1 2020:
GBP11.9m). The reduction in Net Revenue of GBP3.2m is primarily
driven by base business reduction and low supplier revenue due to
reduced demand as a result of the COVID-19 pandemic. In addition,
as previously communicated, one Large contract (GBP0.6m revenue
reduction in H1 2021 compared to H1 2020) ended at the start of the
year. However, through efficiencies, government funded COVID-19
initiatives and cost savings the EMEA Adjusted EBITDA margin
percentage in the period was overall slightly up on the previous
period at 34% (H12020: 33%).
AMERICAS
Net Revenue from the region decreased by 35% to GBP5.0m (H1
2020: GBP7.7m). The GBP2.7m reduction in revenue in the region also
reflected the impact of COVID-19 with base business activity
declining and very low levels of Supplier Revenue due to the travel
restrictions. The Adjusted EBITDA loss of GBP(1.7)m is higher than
prior year of GBP(1.5)m and Adjusted EBITDA margin percentage of
(34)% is below prior year of (20)%. Despite reduced profitability,
we made the conscious decision to retain key people, despite few
government funded COVID-19 initiatives across the region, to be
ready when the effects of COVID-19 unwind and activity returns.
APAC
Net Revenue decreased by 17% to GBP3.5m (H1 2020: GBP4.2m). The
impact of COVID 19 pandemic (on our revenue) in this region
appeared to have levelled-off at current levels, however further
revenue recovery is dependent on the timing of international travel
opening back up again. Through operational efficiencies, some
government funded COVID-19 initiatives and tight cost control, the
region has moved to an Adjusted EBITDA profit of GBP0.4m compared
to an Adjusted EBITDA loss of GBP(0.3)m in the prior period.
Cash flow
H1 2021
GBPm
Loss before tax (3.6)
Net finance expense 0.2
Movement in working capital 0.9
Non-cash items (share-based payments, depreciation,
amortisation charges and exceptional items) 4.9
--------
Pre-tax operating cash in flows 2.4
Capital expenditure -
Investment in intangibles (2.5)
Taxation (0.3)
--------
Cash outflow (0.4)
Cash receipts from issue of new shares 0.6
Repayment of leases and net interest (1.7)
--------
Net Financing activities (1.5)
Foreign currency movements (0.3)
--------
Reduction in cash (1.8)
--------
Cash and cash equivalents balance 9.2
========
Pre-tax operating cash inflows of GBP2.4m, reflecting a loss
before tax of GBP3.6m, reduced net working capital of GBP0.9m, and
add back of non-cash items of GBP4.9m, as highlighted above.
Additionally, as planned, there was GBP2.5m (H1 2020: GBP2.7m)
of capital investment in the period in both our global content, our
internal CRM platform (TenMAID) and the continued development of
our digital platform.
Repayment of leases and net interest of GBP1.7m has resulted in
a cash outflow in the period of GBP1.8m.
Balance sheet
GBPm As at 28 February As at 31 August
2021 2020
Intangible assets 10.7 10.5
------------------ ----------------
Property, plant and equipment 0.8 1.1
------------------ ----------------
Right-of-use Asset 3.9 5.1
------------------ ----------------
Cash 9.2 11.0
------------------ ----------------
Other Current Assets 5.3 7.0
------------------ ----------------
Current Liabilities (14.1) (15.8)
------------------ ----------------
Long Term Borrowings (1.0) (1.0)
------------------ ----------------
Other non-current Liabilities (2.2) (2.7)
------------------ ----------------
Net assets 12.6 15.2
------------------ ----------------
Share capital/Share premium 29.2 28.6
------------------ ----------------
Reserves (16.6) (13.4)
------------------ ----------------
Total equity 12.6 15.2
------------------ ----------------
Net assets of GBP12.6m includes cash of GBP9.2m as at 28(th)
February 2021. Right-of-use Asset reduced as a result of
renegotiation, expiry of leases, and new leases taken out on better
terms. The Group carries GBP1.0m in debt from the US government as
a Payment Protection Program (PPP) loan. We have submitted a loan
forgiveness application in line with US government guidance and we
await confirmation if some or all of this loan will be
forgiven.
Principle Risks and Uncertainties
The principle risks and uncertainties facing the Group remain
broadly consistent with the Principle Risks and Uncertainties
reported in Ten's 2020 Annual Report.
Alex Cheatle Alan Donald
Chief Executive Officer Chief Finance Officer
12 May 2021 12 May 2021
Consolidated statement of comprehensive income
Note 6 months 6 Months
to 28 February to 29 February
2021 2020
Unaudited Unaudited
GBP'000 GBP'000
Revenue 2 17,484 25,570
Cost of sales on principal member transactions (318) (1,802)
---------------- ----------------
Net Revenue 2 17,166 23,768
Other cost of sales (328) (559)
Gross profit 16,838 23,209
Administrative expenses (20,202) (25,288)
Other income 150 -
Operating profit/(loss) before amortisation,
depreciation, interest, share based payments,
exceptional items and taxation ("Adjusted
EBITDA") 1,689 2,060
Depreciation (1,765) (2,286)
Amortisation 3 (1,877) (1,355)
Share-based payment expense (816) (498)
Exceptional items 3 (445) -
------------------------------------------------ ----- ---------------- ----------------
Operating loss (3,214) (2,079)
Net Finance Expense (365) (1,244)
---------------- ----------------
Loss before taxation (3,579) (3,323)
Taxation expense 4 (351) (406)
---------------- ----------------
Loss for the year (3,930) (3,729)
================ ================
Other comprehensive (expense)/income:
Foreign currency translation differences (135) 652
Total comprehensive loss for the year (4,065) (3,077)
================ ================
Basic and diluted loss per ordinary share 5 (4.9)p (4.6)p
The consolidated statement of comprehensive income has been
prepared on the basis that all operations are continuing
operations.
Consolidated statement of financial position
Note 6 months 31 August
to 28 February 2020
2021
Unaudited Audited
GBP'000 GBP'000
Non-current assets
Intangible assets 3 10,736 10,532
Property, plant and equipment 764 1,126
Right of use assets 3,858 5,116
----------
Total non-current assets 15,358 16,774
---------------- ----------
Current assets
Inventories 61 66
Trade and other receivables 5,243 6,941
Cash and cash equivalents 9,172 10,957
----------
Total current assets 14,476 17,964
---------------- ----------
Total assets 29,834 34,738
================ ==========
Current liabilities
Trade and other payables (11,134) (11,906)
Provisions (578) (596)
Lease Liabilities (2,413) (3,335)
Total current liabilities (14,125) (15,837)
---------------- ----------
Net current assets 351 2,127
================ ==========
Non-current liabilities
Borrowings (959) (1,000)
Lease Liabilities (2,169) (2,668)
Total non-current liabilities (3,128) (3,668)
---------------- ----------
Total liabilities (17,253) (19,505)
================ ==========
Net assets 12,581 15,233
================ ==========
Equity
Called up share capital 81 81
Share premium account 29,077 28,480
Merger relief reserve 1,993 1,993
Treasury reserve 15 15
Foreign exchange reserve (540) (405)
Retained deficit (18,045) (14,931)
Total equity 12,581 15,233
================ ==========
Consolidated statement of changes in equity
Share Merger Foreign
Share premium relief exchange Treasury Retained
Note capital account reserve reserve reserve deficit Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1 September
2019 (Audited) 81 28,480 1,993 (345) (30) (9,234) 20,945
--------- --------- --------- ---------- --------- --------- --------
Period ended 31 August
2020:
Loss for the year - - - - - (6,896) (6,896)
Change in accounting
policy - - - - - (326) (326)
Foreign exchange - - - (60) - - (60)
Total comprehensive loss
for the year - - - (60) - (7,222) (7,282)
Shares sold by Employee
Benefit Trust (EBT) - - - - 45 - 45
Equity-settled share-based
payments charge - - - - - 1,525 1,525
Balance at 31 August
2020 (Audited) 81 28,480 1,993 (405) 15 (14,931) 15,233
Period ended 28 February
2021
Loss for the year - - - - - (3,930) (3,930)
Foreign exchange - - - (135) - - (135)
--------- --------- --------- ---------- --------- --------- --------
Total comprehensive loss
for the year - - - (135) - (3,930) (4,065)
Equity-settled share-based
payments charge - - - - - 816 816
Issue of new share capital - 597 - - - - 597
Balance at 28 February
2021 (Unaudited) 81 29,077 1,993 (540) 15 (18,045) 12,581
========= ========= ========= ========== ========= ========= ========
Condensed consolidated statement of cash flows
GBP'000 Note 6 Months 6 Months
to 28 February to 29 February
2021 2020
GBP'000 GBP'000
Cash flows from operating activities
Loss for the year, after tax (3,930) (3,729)
Adjustments for:
Taxation expense 4 351 406
Finance expense 173 241
Amortisation of intangible assets 3 1,877 1,353
Depreciation of property, plant and equipment 376 452
Depreciation of right-of-use asset 1,389 1,834
Equity-settled share based payment expense 816 498
Impairment 3 445 -
Movement in working capital:
Decrease/(Increase) in inventories 5 (47)
Decrease in trade and other receivables 1,698 2,072
(Increase) in trade and other payables (786) (219)
Cash generated from operations 2,414 2,861
Tax paid (227) (207)
Net cash generated from operating activities 2,187 2,654
---------------- ----------------
Cashflows from Investing activities
Purchase of intangible assets 3 (2,525) (2,749)
Purchase of property, plant and equipment (49) (581)
Finance income - 2
Net cash used by investing activities (2,574) (3,328)
---------------- ----------------
Cash flows from financing activities
Lease Liability repayments (1,544) (1,847)
Interest received/(paid) - (3)
Interest paid on lease liabilities (167) (237)
Cash receipts from issue of share capital 597 -
Net cash (used) by financing activities (1,114) (2,087)
---------------- ----------------
Foreign currency movements (284) -
Net decrease in cash and cash equivalents (1,785) (2,761)
Cash and cash equivalents at beginning of period 10,957 12,341
Cash and cash equivalents at end of period
Cash at bank and in hand 9,172 9,580
Cash and cash equivalents 9,172 9,580
================ ================
Notes to the Interim Financial Information
1. Basis of preparation
These interim consolidated financial statements have been
prepared using accounting policies based on applicable law and
international accounting standards, in conformity with the
requirements of the Companies Act 2006. Furthermore, the financial
information has been prepared on the historical cost basis except
that financial instruments are stated at the fair value. They do
not include all disclosures that would otherwise be required in a
complete set of financial statements and should be read in
conjunction with the 31 August 2020 Annual Report. The financial
information for the half years ended 28 February 2021 and 29
February 2020 does not constitute statutory accounts within the
meaning of Section 434 (3) of the Companies Act 2006 and both
periods are unaudited.
The annual financial statements of Ten Lifestyle Group plc ('the
Group') are prepared in accordance with international accounting
standards in conformity with the requirements of the Companies Act
2006. The comparative financial information for the year ended 31
August 2020 included within this report does not constitute the
full statutory Annual Report for that period. The statutory Annual
Report and Financial Statements for year ended 31 August 2020 have
been filed with the Registrar of Companies. The Independent
Auditors' Report in the Annual Report and Financial Statements for
the year ended 31 August 20120 was unqualified, did not draw
attention to any matters by way of emphasis and did not contain a
statement under 498(2)-(3) of the Companies Act 2006.
The Group has applied the same accounting policies and methods
of computation in its interim consolidated financial statements as
in its year ended 31 August 2020 annual financial statements,
except for those that relate to new standards and interpretations
effective for the first time for periods beginning on (or after) 1
January 2020, and will be adopted in the year ended 31 August 2021
financial statements. There are currently deemed to be no new
standards, amendments and interpretations to existing standards,
which have been adopted by the Group, that have had a material
impact on the financial statements
The Group's financial information has been presented in Pounds
sterling (GBP).
Going Concern
The consolidated financial statements have been prepared on a
going concern basis.
In carrying out the going concern assessment, the Directors have
considered a number of scenarios, taking account of the possible
impacts of the continuing impact of the coronavirus pandemic, in
relation to revenue forecasts for the next 12 months. A material
downside scenario assumes a longer delay in the recovery of both
variable corporate and supplier revenues whilst assuming the
current agreed contractual minimum revenues will be maintained over
the period. In such a scenario, the Group has identified cost
reductions which could be implemented, to help mitigate the impact
on cash outflows.
In reaching their going concern assessment, the Directors have
considered the foreseeable future, a period extending 12 months
from the date of approval of this half-yearly financial report.
This assessment has included consideration of the forecast
performance of the business, as noted above, the cash and financing
facilities available to the Group.
In light of all of this analysis, the Directors are satisfied
that, even if this downside scenario were to occur, the Group has
sufficient cash resources over the period. As such, the
consolidated financial statements have been prepared on a going
concern basis.
The Board of Directors approved this interim report on 12 May
2021.
2. Segmental Information
The total revenue for the Group has been derived from its
principal activity; the provision of concierge services.
6 months to 6 months to
28 February 29 February
2021 2020
Unaudited Unaudited
GBP'000 GBP'000
EMEA 8,735 11,908
Americas 4,997 7,674
Asia 3,434 4,186
Net Revenue 17,166 23,768
Add back: Cost of sales on principal member
transactions 318 1,802
Revenue 17,484 25,570
EMEA 2,956 3,868
Americas (1,653) (1,533)
Asia 386 (275)
Adjusted EBITDA 1,689 2,060
Depreciation (1,765) (2,286)
Amortisation (1,877) (1,355)
Share-based payment expense (816) (498)
Exceptional Items (445) -
Operating loss (3,214) (2,079)
Foreign exchange loss (192) (1,005)
Other net finance expense/income (173) (239)
Loss before taxation (3,579) (3,323)
Taxation charge (351) (406)
Loss for the period (3,930) (3,729)
============ =============================
Net Revenue is a non-GAAP Group measure that excludes the direct
cost of sales relating to member transactions managed by the Group,
such as the cost of airline tickets sold under the Group's ATOL
licences. Net Revenue is the measure of the Group's income on which
segmental performance is measured.
Adjusted EBITDA is a Group non-GAAP specific measure excluding
interest, taxation, depreciation, amortisation, share-based
payments and exceptional items, the latter being expenses which are
considered to be one-off and non-recurring in nature (where
applicable).
Adjusted EBITDA is the main measure of performance used by the
Group's Chief Executive Officer, who is considered to be the chief
operating decision maker. Adjusted EBITDA is the principal profit
measure for a segment.
The statement of financial position is not analysed between
reporting segment. Management and the chief operating
decision-maker consider the statement of financial position at
Group level.
3. Intangible Assets
The Group capitalised GBP2.5m (H1 2020: GBP2.7m, FY 2020:
GBP5.3m) of costs representing the development of Ten's global
digital platform, TenMAID (Ten's proprietary customer relationship
management system) resulting in a net book value of GBP10.7m (H1
2020: GBP10.4m, FY 2020: GBP10.5m) after an amortisation charge of
GBP1.8m (H1 2020: GBP1.4m, FY 2020: GBP3.3m) as well as am
impairment of GBP0.4m (H1 2020: Nil, FY 2020: GBP0.4m).
There is an impairment charge in the year related to specific
know-how, enabling more cost-efficient servicing of concierge
request. An assessment of the data base capitalised determines that
a specific portion of this was less likely to generate future
economic benefits due to the impact of COVID-19 pandemic on this
data. Such impairment is considered to be a one-off in nature and
therefore has been presented as an exceptional item.
Exceptional Items
2021 2020
GBP'000 GBP'000
Impairment of intangible asset (445) -
-------- ------------
(445) -
4. Taxation
The income tax expense has been recognised based on the best
estimate of the weighted average annual effective UK corporation
tax rate expected for the full financial year. The Group currently
forecasts a loss for the financial year ending 31 August 2021 and
therefore no charge has been recognised in regard to UK corporation
tax in the period.
The income tax expense of GBP0.4m (H1 2020: GBP0.4m) included
foreign taxes recognised by overseas Group companies on a territory
by territory basis using the expected effective tax rate for the
full year.
5. Loss Per Share
6 months to 6 months
28 February to
2021 29 February
Unaudited 2020
Unaudited
GBP'000 GBP'000
Loss attributable to equity shareholders of
the parent (3,930) (3,729)
------------- -------------
Weighted average number of ordinary shares
in issue (net of treasury) 80,302,498 80,103,503
Basic loss per share (pence) (4.9)p (4.6)p
------------- -------------
Where the Group has incurred a loss in the six-month period to
28 February 2021, the diluted earnings per share is the same as the
basic loss per share as the loss has an anti-dilutive effect.
6. Cautionary Statement
This document contains certain forward-looking statements
relating to Ten Lifestyle Group plc. The Company considers any
statements that are not historical facts as "forward-looking
statements". They relate to events and trends that are subject to
risk and uncertainty that may cause actual results and the
financial performance of the Company to differ materially from
those contained in any forward-looking statement. These statements
are made by the Directors in good faith based on information
available to them and such statements should be treated with
caution due to the inherent uncertainties, including both economic
and business risk factors, underlying any such forward-looking
information.
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END
IR BLLLFFELBBBL
(END) Dow Jones Newswires
May 13, 2021 02:00 ET (06:00 GMT)
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