TIDMBONH
RNS Number : 7991T
Bonhill Group PLC
25 March 2019
25 March 2019
Bonhill Group plc
("Bonhill", the "Company" or the "Group")
FINAL RESULTS
Bonhill Group plc (AIM: BONH), a leading B2B media business
specialising in three key areas: Business Information, Live Events
and Data & Insight, today announces its audited final results
for the nine months ended 31 December 2018.
Financial Highlights
-- Revenue of GBP8.0 million (year ended 31 March 2018: GBP2.6
million)
-- InvestmentNews contributed GBP6.0 million of revenue in the
four and a half months since its acquisition
-- Adjusted EBITDA* of GBP0.9 million (year ended 31 March 2018:
GBP0.4 million loss)
-- Net assets of GBP22.9 million (31 March 2018: GBP2.0 million)
-- Further strengthening of the balance sheet with GBP4.4 million
in cash at 31 December 2018 (31 March 2018: GBP1.0 million)
-- Process commenced to enable payment of a maiden dividend in
respect of the six months ending 30 June 2019
*Adjusted EBITDA excludes adjusting items, acquisition costs and
amortisation of intangible assets through business combinations as
set out in Note 5 below
Operational Highlights
-- Completed transformational acquisition of 20 year old market
leading US brand, InvestmentNews, in August 2018
-- Equity fundraising of GBP19.2 million to fund the acquisition
of InvestmentNews, broaden the institutional shareholder
base and invest in the Company's infrastructure and technology
platform
-- A new Head of Digital recruited to oversee growth of the
InvestmentNews Digital division
-- Expansion of 'Women in...' series to two new locations,
Dublin and San Francisco, and the London event held in
early 2019 attracted a record 1,150 attendees
-- Launch of 'DiversityQ' in summer 2018
Commenting on the outlook for the Group, Simon Stilwell, CEO of
Bonhill, said:
"The business has invested in its people, processes, structure
and a new strategy from which to grow in a market abound with
opportunities. We are confident that, underpinned by investment
into the robust core business, we are in a strong position to drive
growth and deliver returns for our shareholders over the coming
years.
"The InvestmentNews integration plan is on track and
InvestmentNews is performing well, showing that our acquisition
strategy is working. There are clearly major opportunities to
develop the brand further which we will do in the years ahead. We
will look to replicate this success in our other target sectors and
will seek to develop them in 2019 and beyond. We will continue to
invest across the business and look forward to another year of
growth and development with confidence."
Commenting on the proposed acquisition of Last Word Media, Neil
Sachdev, Chairman of Bonhill, said:
"We are delighted to announce the proposed acquisition of Last
Word Media, a leading B2B media company supporting the global asset
management industry. It is aligned to our growth strategy and we
believe that it will be an excellent partner for our InvestmentNews
business. We look forward to bringing Last Word into the Bonhill
Group and to working with Last Word's founders and their team."
-ends-
For further enquiries please contact:
Bonhill Group plc +44 (0)20 7250 7035
Simon Stilwell, Chief Executive
David Brown, Group Finance Director
Stockdale Securities Limited (Nominated
Adviser and Joint Broker) +44 (0)20 7601 6100
Tom Griffiths
David Coaten
Canaccord Genuity Limited (Joint Broker)
Bobbie Hilliam
Adam James
Georgina McCooke +44 (0)20 7523 8000
Belvedere Communications (Financial PR) +44 (0)20 3687 2757
John West
Kim van Beeck
About Bonhill Group plc
Bonhill Group plc is an AIM-quoted leading B2B media business
specialising in three key areas: Business Information, Live Events
and Data & Insight in three key sectors: Technology, Financial
Services and Diversity. Bonhill's ambition is to create content
that informs, communities that engage and brands that inspire in
order to enable a better business environment for our sponsors and
clients.
Flagship titles include: InvestmentNews, SmallBusiness.co.uk,
Growth Company Investor, Information Age, GrowthBusiness.co.uk and
What Investment. Bonhill is also responsible for a growing
portfolio of high-profile events, including The Quoted Company
Awards, Women in IT Awards, Women in Finance Awards and British
Small Business Awards, amongst others.
For more information visit www.bonhillplc.com
Chairman's Statement
The nine months ended 31 December 2018 was a period of
transformation and wholesale change at Bonhill which culminated in
the Group reporting a maiden adjusted profit.
In August 2018, the Company completed the reverse takeover of US
based InvestmentNews. This 20-year-old market leading brand was the
Group's first acquisition and, in line with our strategy, added a
high quality, high margin, cash generative business. The
transaction was funded by an equity fundraising of GBP19.2 million
and the provision of a vendor loan of GBP4.7 million. The equity
issue brought a new, broader group of institutional shareholders,
to support the Board and the Group's strategy in building a global
B2B business focused on the Financial Services, Technology and
Diversity sectors. InvestmentNews had a strong 2018 and delivered a
record operating performance in the year with revenue up 14 per
cent. on the prior year. Under the Group's ownership, we see
enormous potential for expanding its events and data propositions
as well as growing its business information portfolio.
We have continued to build our other brands and our diversity
franchise. The ever-expanding 'Women in...' series was successfully
launched during the year in two new important locations, Dublin and
San Francisco. There is enormous potential for this global
franchise. DiversityQ, which is aimed at professionals and business
leaders to provide content and analysis to enhance, develop and
promote workforce diversity and inclusion, was also launched in
summer 2018 and complements our other diversity initiatives.
Given the increasing significance of the 'Women in...' series,
Niki Dowdall has decided to step-down from the Board with immediate
effect, to focus full-time on developing this key franchise. I
would like to thank her for her commitment to Bonhill, steering the
business through some difficult times. Niki has led the development
of the 'Women in...' franchise from its inception and, in this new
role, will continue to make a valuable contribution to Bonhill into
the future.
As we have grown, we have looked at every part of the business
and have made significant changes to strengthen our people,
advisory network, digital capability and business support
functions. As the business grows, we continue to ensure that we
have the highest calibre of people in the right roles and are
focused on attracting and retaining the best talent we can. I would
like to thank all of our team for their hard work during a period
of such change.
We continue to build our leadership capability and senior
leadership team, and coupled with some planned hires, we are well
placed to capitalise on the growth potential from the
InvestmentNews' acquisition and have the requisite skills to
continue to grow the Group organically and by acquisition. Our
corporate structure has been significantly strengthened following
the acquisition of InvestmentNews, from policies and procedures
through to financial processes. This strengthening provides the
foundations for the smooth integration of further acquisitions. We
have also recently adopted the QCA Code and are committed to the
highest standards of governance.
The period also saw a name change, an office relocation, a
change of year end to align ourselves with InvestmentNews', but
also to better manage our accounting periods with our events
calendar, and a 1:40 share consolidation. We have commenced the
court process to enable us to pay a dividend, the first being an
interim dividend this year.
At the period end, the Company had GBP4.4 million of cash, a
strong profitable operating business, a robust infrastructure and
an ambitious team keen to build a business of scale in our chosen
areas. With the support of our shareholders, and the energetic
input from our talented team, I look forward to delivering on the
opportunities available to the Group.
We are delighted to announce separately the proposed acquisition
of Last Word Media. This represents a tremendous strategic fit with
our existing Financial Services offering and our combined entities
will offer a truly global marketing solution for our asset
management clients. I look forward to welcoming the founders and
team to our business.
Neil Sachdev
Non-Executive Chairman
22 March 2019
Chief Executive's Review
Introduction
It has been an extremely busy and particularly rewarding nine
month reporting period. It was a period of great change which has
seen the business grow both organically as well as through
acquisition and, during that process, almost every aspect of the
business has been assessed and, where appropriate, adapted and
enhanced. We have made terrific progress, but there is still much
to be done and there are opportunities aplenty. Bonhill ended the
period barely recognisable from the one that started it in April
2018. When I took over as the Company's Chief Executive in August
2017, I saw great potential for the business and I am pleased that
we are finally starting to realise that. In the interim, we have
refreshed the Board and the management team, embarked on a new
strategy and, as a result, we now have a profitable, cash
generative underlying business many times bigger than the original
company, and with significant growth potential.
One of my key objectives on taking over the role was to make the
business profitable and we have achieved that on an adjusted basis.
The next step is to enhance the scale, nature, geographic reach,
revenue and margin of the Group and I believe that we have the
platform, support and resources to do so.
Financial information
For the nine months ended 31 December 2018, we reported revenues
of GBP8.0 million (year ended 31 March 2018: GBP2.6 million) and
adjusted EBITDA of GBP0.9 million (year ended 31 March 2018: GBP0.4
million loss). This is partly as a result of the acquisition of
InvestmentNews in mid-August 2018, which contributed GBP6.0 million
of revenue for the Group in the four and a half months, but also
through the growth of the Company's existing UK portfolio. The
period under review is the 9 months from 1 April 2018 to 31
December 2018 as the year end was changed to coincide with
InvestmentNews', but also to better accommodate our events
calendar. We ended the period with GBP4.4 million of cash (31 March
2018: GBP1.0 million) which is approximately twice the Company's
market capitalisation when I was appointed Chief Executive and we
have started the process to enable the payment of a maiden interim
dividend later this year.
Strategic review
We have refined our strategy to focus on the provision of
Business Information, Live Events and Data & Insight in our
three chosen sectors and with a growing geographic reach. We aspire
to build, manage and own market leading brands with 'must have'
products, that provide greater financial visibility via recurring
revenue streams and strong cash generation. We operate in three
clearly defined global business sectors: Technology; Financial
Services; and Diversity, all of which are growing, constantly
evolving and are extremely complementary.
Acquisition of InvestmentNews
In mid-August 2018, we completed the acquisition of
InvestmentNews, a 20 year old US title that is the market leading
provider of news and information to the growing US financial
advisory community. It is a key partner for both advisers and asset
managers. It had a clear strategic fit as it was already providing
business information, live events and data. It is our ambition to
invest in the business to further develop the events and data
propositions, which we believe had been under exploited previously.
We are delighted that the business has delivered a record year,
despite the distraction of the transaction, and in our period of
ownership we have identified a wealth of opportunities. The US
location provides an important base for us to continue our
strategic goals. InvestmentNews sits strategically between the key
constituents of the large US professional investment market, an
industry that is constantly undergoing change through regulation,
acquisition, product launches, changing demographics, evolving
technology and the changing role of advice. This complex and
dynamic environment provides a strong backdrop for InvestmentNews'
services. We are delighted that all of the core team have stayed
with us post-acquisition and are working hard together to explore
and exploit new opportunities and enhance the future mix of the
business.
We have recently recruited a new Head of Digital, who will
oversee the largest part of the business. We have already expanded
the Group's events portfolio, best evidenced by the growth in the
'Women Adviser' summit series from four in 2018, to six planned for
2019 and an expanded events team will help continue the growth in
all events activities.
With a new Head of Digital and an improved technology platform,
we are currently looking at how to augment InvestmentNews' data
products with our own data sources and third party suppliers.
Custom research products are growing extremely well and will be a
big feature in 2019 and beyond. There is a new energy in the
InvestmentNews brand and a renewed purpose, all of which bodes
well. We take great comfort from the references and dialogue we
have had with major customers and clients post-acquisition, which
we were unable to do beforehand.
'Women in...' Series
I am delighted that we have continued to see growth in our
'Women in...' series. We have had successful launches in Dublin and
San Francisco and the London event in early 2019 reached a record
level of attendance at 1,150. Women in Finance has also seen good
growth and 2019 will see the development of this global franchise
in another three cities. There is still much to be done to address
gender diversity, especially in the finance and technology
industries, and the scope of our activities, including our
DiversityQ brand, will increase in 2019.
UK assets
After another quiet year for our UK assets, we finally have
these titles under control and, with some new leadership and
clearer assessment of our audience needs, we are starting to make
progress. I am optimistic for the future potential in this
area.
During the period, we have also refreshed our financial services
titles, which include InvestmentNews, What Investment and Growth
Company Investor. What Investment has had an editorial change and a
rebranding that has seen a marked improvement in readership and
better advertising returns. It is encouraging to see the response
to our efforts in reinvigorating the product from its loyal
subscription base.
As well as our titles, we also have awards that support the
community. In particular, the Grant Thornton Quoted Company Awards,
which focuses on the people behind the businesses in the quoted
company arena, continues to do well and its 20th anniversary event,
which was held in February 2019, was another great success.
Data
We have talked previously of our ambition to build a much
stronger data business out of our titles. While this is a longer
term ambition, we have recently strengthened our team and the
investment in technology we have made will soon start to produce
benefits from data driven decisions and improved data sales and
opportunities.
We are looking to recruit a new Head of Products to drive our
strategy in this area. Data should be the foundation for our
business decisions and we have already seen the benefit of its use
in the targeted roll out of our growing events portfolio. The
impact will be modest in 2019, but we should start to see a much
bigger contribution in 2020.
Personnel
In May 2018, we announced the appointment of David Brown as
Group Finance Director. David brings a wealth of complementary
experience to the new and refreshed management team. He has proven
execution capability in acquisitions, understands the plc
environment and we are very pleased to have appointed somebody of
his calibre.
We have undertaken a fairly radical change in our people
resulting in an abnormally high level of staff turnover during the
period. I think this is entirely appropriate given the change in
pace and ambition of the Company and, now with a much more
interesting product set and business momentum, I expect that we
will continue to attract fresh talent that can have a material
impact on our business areas. We are working hard to improve our
culture and inter-company communications.
As part of the equity fundraising in 2018, and in conjunction
with the acquisition of InvestmentNews, we took the opportunity to
reassess every policy, procedure and process within the business.
It was an important milestone in the Company's history and offered
an opportunity for us to examine and evolve both our internal and
external processes. We always strive for best practice and believe
that we have now built a solid foundation in order to uphold the
highest standards of governance and process in every aspect of our
business. With these foundations in place, we believe that we are
well placed to embark on the rest of our growth plans.
We remain attracted by the long term prospects of the wider B2B
arena. As we continue to evolve the business, we have learnt more
about our customer needs and this has highlighted the potential to
build a global solutions provider in our chosen areas. Our sectors
are rapidly evolving and there is a constant need for information
and insight to help manage this change. We remain convinced that
with high quality, content led solutions across information, events
and data, we will continue to be a valued and effective partner.
Our culture is to constantly review and ensure that we are meeting
our clients' needs and providing the highest levels of service. In
the diversity segment, where best practice has yet to be
established globally, we are helping to highlight and define what a
diverse workforce and inclusive workplace can mean for an
organisation.
Technology
We raised additional VCT and EIS funds as part of the equity
fundraising in the summer to invest in the Company's infrastructure
and technology platform. By the period end, we had completed our
technology choices and 2019 has seen the implementation phase start
in earnest. Much of the work will be undertaken during the course
of this year, but what we expect to emerge is an excellent platform
for us to communicate with our audiences, undertake greater
analysis of our business and deliver better solutions for our
clients. This technology refresh was much needed for both the
existing business and InvestmentNews and we are already starting to
see what the initial benefits of the work will be.
Acquisition Strategy
We continue to assess further acquisition opportunities to
complement our growth strategy and are continually assessing
potential opportunities that we believe will meet our strategic
criteria. Areas of interest for us and potential targets must have
the following characteristics: market leading; high degree of
visible revenue; and alignment with our existing sectors. There is
plenty of activity in our target sectors, but we will remain
disciplined and maintain our strict criteria.
We are delighted to announce separately today the proposed
acquisition of Last Word Media, a key media partner to the asset
management industry. It has strong alignment with our existing
financial services brand and brings greater geographic coverage,
high quality people and a strong events portfolio to our business.
We believe there is good growth in the existing business and the
opportunity to develop their products into the US.
Outlook
The business now has better people, processes, structure and a
new strategy from which to grow in a market abound with
opportunities. We are confident that, underpinned by investment
into the robust core business, we are in a strong position to drive
growth and deliver returns for our shareholders over the coming
years.
InvestmentNews has been integrated into the Group and is
performing well, showing that our acquisition strategy is working.
There are clearly major opportunities to develop the brand further
which we will do in the years ahead. We will look to replicate this
success in our other target sectors and will seek to develop them
in 2019 and beyond. We will continue to invest across the business
and look forward to another year of growth and development with
confidence.
Simon Stilwell
Chief Executive
22 March 2019
Group Finance Director's Review
Income statement
Adjusted results are prepared to provide a more comparable
indication of the Group's core business performance by removing the
impact of certain items including exceptional items (material and
non-recurring), and other separately reported items. Adjusted
results exclude adjusting items as set out in the statement of
consolidated income and below, with further details given in Notes
4 and 5 of the financial statements. In addition, the Group also
measures and presents performance in relation to various other
non-GAAP measures, such as underlying revenue growth, adjusted cash
flow, adjusted EBITDA and net assets. Adjusted results are not
intended to replace statutory results. These have been presented to
provide users with additional information and analysis of the
Group's performance, consistent with how the Board monitors
results. Further rationale for each of the adjusting items used in
these measures, as well as reconciliations to their statutory
equivalents, can be found in Note 5 to the financial
statements.
31 Dec 2018 31 Mar 2018
9 months 12 months
GBP'000 GBP'000
------------------------------------------- ------------ -----------
Revenue 7,991 2,606
Adjusted EBITDA profit/(loss) 889 (393)
Depreciation / amortisation of internally
generated intangibles (155) (45)
Share option charge (68) -
------------------------------------------- ------------ -----------
Adjusted operating profit/(loss) 666 (438)
Finance costs (146) (7)
------------------------------------------- ------------ -----------
Adjusted profit/(loss) before tax 520 (445)
Adjusted tax - -
------------------------------------------- ------------ -----------
Adjusted profit/(loss) 520 (445)
Adjusting items (after tax) (2,360) (526)
------------------------------------------- ------------ -----------
Statutory loss (1,840) (971)
------------------------------------------- ------------ -----------
Adjusted profit/(loss) per share 2.69p (12.29)p
Statutory loss per share (9.51)p (26.79)p
------------------------------------------- ------------ -----------
InvestmentNews generated GBP6.0 million of revenue in the four
and a half months since it was acquired on 17 August 2018.
InvestmentNews delivered record revenue of $19.2 million for the
calendar year 2018, which is 14 per cent. ahead of the preceding
year. All of its business units (print, digital and live events)
increased their revenues on the prior year and the business had a
strong finish to the year with revenues in the final quarter up 10
per cent. on the prior year period.
The UK based Events business generated total sales of GBP1.5
million which is double the sales compared to the same 9 month
period last year (unaudited). Sales of like-for-like events rose by
21 per cent.
UK Media sales saw improved performance in the final quarter
with sales consistent with those in the corresponding period in the
previous year. The recent restructuring of this part of the
business gives us greater confidence in its future growth
prospects. Overall, UK media sales in the period were GBP0.5
million.
Adjusted earnings before interest, depreciation and amortisation
("EBITDA") is a measure of earnings and cash generative capacity. A
reconciliation of adjusted EBITDA to statutory earnings is set out
in Note 5 below. An adjusted EBITDA gain of GBP0.889 million (31
March 2018: GBP0.393 million loss) was comprised of a GBP1.6
million contribution from InvestmentNews and a GBP0.7m loss from
the UK business which carries the central overheads for the
Group.
Adjusting items comprised GBP1.932 million (31 March 2018:
GBP0.082 million) of acquisition related costs, GBP0.252 million of
integration costs (31 March 2018: GBPNil) and GBP0.456 million (31
March 2018: GBP0.431 million) relating to amortisation or write off
of intangible assets acquired, together with tax relief on these
items of GBP0.280 million.
On an adjusted basis, the retained profit was GBP0.520 million
(31 March 2018: loss of GBP0.445 million), equivalent to 2.69p per
share (31 March 2018: 12.29p loss per share). The statutory loss
for the period was GBP1.840 million (31 March 2018: GBP0.971
million), equivalent to 9.51p per share (31 March 2018: 26.79p per
share).
Cash flow
31 Dec 31 Mar 2018
2018
9 months 12 months
GBP'000 GBP'000
-------------------------------------------- ---------- -----------
Adjusted EBITDA 889 (393)
Working capital movement (1,290) (464)
Interest paid (267) (7)
Foreign exchange gains or losses 8 -
Purchases of property, plant and equipment
and intangible assets (134) (40)
-------------------------------------------- ---------- -----------
Free cash outflow (794) (904)
Acquisition of InvestmentNews (12,867) -
Acquisition costs (1,774) (82)
Proceeds from issue of ordinary shares 19,247 2,021
Repayment of borrowings (449) (147)
Net cash inflow 3,363 888
-------------------------------------------- ---------- -----------
Working capital showed an outflow due to the timing of the
acquisition of InvestmentNews, though this has been offset by
reduced consideration for the acquisition.
Net of GBP1.3 million of costs, GBP19.2 million of share placing
proceeds were raised in the period (31 March 2018: GBP2.0 million),
of which GBP12.9 million was used as part consideration to acquire
InvestmentNews, and GBP1.8 million paid out relating to acquisition
costs, leading to a net cash inflow of GBP3.363 million (31 March
2018: GBP0.888 million).
Balance sheet
31 Dec 31 Mar 2018
2018 GBP'000
GBP'000
-------------------------- --------- -----------
Intangibles 23,416 1,127
Tangible fixed assets 125 35
Working capital 1,554 (203)
Lease asset 968 -
Lease liability (1,018) -
-------------------------- --------- -----------
Deferred and current tax (2,163) -
Cash 4,367 1,004
Debt (4,323) -
-------------------------- --------- -----------
Net assets 22,926 1,963
-------------------------- --------- -----------
At 31 December 2018, the business had a healthy cash balance of
GBP4.367 million (31 March 2018: GBP1.004 million).
The acquisition of InvestmentNews was, in part, financed by a
vendor loan of GBP4.720 million, which had been reduced to GBP4.323
million by the balance sheet date. The loan is repayable in equal
monthly instalments until 31 August 2021.
Going concern
The Group's business activities, together with the factors
likely to affect its future development, performance and position,
are set out in the Chairman's Statement and the Chief Executive's
Review.
The Directors regularly review detailed forecasts of sales,
costs and cash flows, and regularly project forwards 12 months
ahead or more. The assumptions underlying the budget are
challenged, varied and tested to establish the likelihood of a
range of possible outcomes, including reasonable cash flow
sensitivities. The expected figures are carefully monitored against
actual outcomes each month and variances are highlighted and
discussed at Board level.
The Directors have reviewed cash flow forecasts for the period
to 31 December 2020 and considered cash flow requirements during
that period for the purposes of approving these financial
statements. In preparing these forecasts, they have not taken into
account the proposed acquisition of Last Word Media.
The cash flow forecasts demonstrate that the Group will be able
to pay its debts as they fall due for the period to at least 31
December 2020. In the event that sales did not hit the projected
levels, management is able to adjust overhead levels to relieve any
short-term cash pressures which may arise.
The Directors are, therefore, satisfied that the financial
statements should be prepared on the going concern basis
Current Trading
Sales for the first two months of the year are in line with
market expectations. We have started to see the planned change in
mix from the more traditional business information towards live
events and custom projects. Since the period end, the Group's
flagship event, Women in IT London, which was held on 30 January
2019, delivered sales 37 per cent. ahead of those for last year's
event and we are excited about the potential for this global
franchise.
David Brown
Group Finance Director
22 March 2019
Consolidated statement of comprehensive income
for the nine month period ended 31 December 2018
9 month period ended 12 month period ended
31 December 2018 31 March 2018
Note Adjusted Adjusting Statutory Adjusted Adjusting Statutory
results items results results items results
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Revenue 3 7,991 - 7,991 2,606 - 2,606
Net operating expenses 4 (7,149) (2,184) (9,333) (2,993) (95) (3,088)
Impairment related
to expected credit
losses (21) - (21) (6) - (6)
Depreciation (20) - (20) (6) - (6)
Amortisation and
impairment 4 (135) (456) (591) (39) (431) (470)
--------- ---------- ---------- --------- ---------- ----------
Net operating profit/(loss) 666 (2,640) (1,974) (438) (526) (964)
Finance costs (146) - (146) (7) - (7)
--------- ---------- ---------- --------- ---------- ----------
Loss before tax 520 (2,640) (2,120) (445) (526) (971)
Tax - 280 280 - - -
--------- ---------- ---------- --------- ---------- ----------
Profit/(loss) for
the period 520 (2,360) (1,840) (445) (526) (971)
--------- ---------- ---------- --------- ---------- ----------
Other comprehensive
income:
Items that may be
reclassified subsequently
to profit or loss:
Exchange differences
on translating foreign
operations 35 - 35 - - -
Total comprehensive
income/(loss) for
the year 555 (2,360) (1,805) (445) (526) (971)
--------- ---------- ---------- --------- ---------- ----------
Basic loss per share
attributable to the
owners of the parent 6 2.69p (9.51p) (12.29p) (26.79p)
Diluted loss per
share attributable
to the owners of
the parent 6 (9.51p) (26.77p)
Consolidated statement of financial position
at 31 December 2018
Note 31 December 31 March 2018
2018 GBP'000
GBP'000
NON-CURRENT ASSETS
Goodwill 13,955 564
Other intangible assets 9,461 563
Property, plant and equipment 125 35
Deferred tax asset 333 -
Right-of-use asset 8 968 -
------------ --------------
24,842 1,162
------------ --------------
CURRENT ASSETS
Trade and other receivables 5,278 337
Cash and cash equivalents 4,367 1,004
------------ --------------
9,645 1,341
------------ --------------
TOTAL ASSETS 34,487 2,503
------------ --------------
NON-CURRENT LIABILITIES
Deferred tax liability (2,423) -
Borrowings (2,701) -
Financial lease liability 8 (733) -
------------ --------------
(5,857) -
------------ --------------
CURRENT LIABILITIES
Trade and other payables (3,724) (540)
Borrowings (1,622) -
Financial lease liability 8 (285) -
Current tax liability (73) -
------------ --------------
(5,704) (540)
------------ --------------
TOTAL LIABILITIES (11,561) (540)
------------ --------------
NET ASSETS 22,926 1,963
------------ --------------
EQUITY
Share capital 7 343 4,025
Share premium 26,715 4,315
Share option reserve 68 118
Other reserves 4,086 104
Retained earnings (8,321) (6,599)
Foreign exchange reserve 35 -
------------ --------------
TOTAL EQUITY ATTRIBUTABLE TO OWNERS 22,926 1963
OF THE PARENT
------------ --------------
Consolidated statement of changes in equity
for the nine month period ended 31 December 2018
Share Foreign
Share Share option Other Retained exchange
capital premium reserve reserves earnings reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance as at
31 March 2017
as restated 2,950 3,369 118 104 (5,628) - 913
Total comprehensive
loss for the
period - - - - (971) - (971)
Issue of share
capital 1,075 946 - - - - 2,021
Balance as at
31 March 2018 4,025 4,315 118 104 (6,599) - 1,963
Loss for the
period - - - - (1,840) - (1,840)
Other comprehensive
income - - - - - 35 35
--------- --------- --------- ---------- ---------- ---------- ---------
Total comprehensive
loss for the
period - - - - (1,840) 35 (1,805)
Issue of share
capital 300 23,699 - - - - 23,999
Share issue
costs - (1,299) - - - - (1,299)
Removal of share
option scheme - - (118) - 118 - -
Share option
charge - - 68 - - - 68
Cancellation
of deferred
shares (3,982) - - 3,982 - - -
Balance as at
31 December
2018 343 26,715 68 4,086 (8,321) 35 22,926
--------- --------- --------- ---------- ---------- ---------- ---------
Consolidated statement of cash flows
for the nine month period ended 31 December 2018
Note 9 month period 12 month period
ended ended
31 December 31 March 2018
2018 GBP'000
GBP'000
CASH USED IN OPERATIONS 9 (401) (939)
Interest paid (129) (7)
--------------- ----------------
NET CASH USED IN OPERATING ACTIVITIES (530) (946)
--------------- ----------------
INVESTING ACTIVITIES
Purchases of property, plant and
equipment (90) (32)
Purchases of intangible assets (44) (8)
Cash paid for acquisition (12,867) -
Exceptional costs (1,774) -
--------------- ----------------
NET CASH USED IN INVESTING ACTIVITIES (14,775) (40)
--------------- ----------------
FINANCING ACTIVITIES
Proceeds from issue of ordinary shares 19,247 2,021
Repayment of invoice discount facility
and other borrowings (449) (147)
Payment of vendor loan fees (138) -
--------------- ----------------
NET CASH GENERATED FROM FINANCING
ACTIVITIES 18,660 1,874
--------------- ----------------
FOREIGN EXCHANGE MOVEMENT 8 -
NET INCREASE IN CASH AND CASH EQUIVALENTS 3,363 888
CASH AND CASH EQUIVALENTS AT THE
BEGINNING OF THE PERIOD 1,004 116
--------------- ----------------
CASH AND CASH EQUIVALENTS AT THE OF THE PERIOD 4,367 1,004
--------------- ----------------
Notes to the accounts
1. Basis of preparation
The financial statements of Bonhill Group plc have been prepared
in accordance with EU Endorsed International Financial Reporting
Standards and IFRIC interpretations (IFRS) and the Companies Act
2006 applicable to companies reporting under IFRS. The financial
statements have been prepared under the historical cost
convention.
The preparation of financial statements in conformity with IFRS
requires the use of certain critical accounting estimates. It also
requires management to exercise its judgement in the process of
applying the accounting policies.
The financial information for the 9 month period ended 31
December 2018 and the 12 month period ended 31 March 2018 does not
constitute the company's statutory accounts for those years.
Statutory accounts for the 12 month period ended 31 March 2018
have been delivered to the Registrar of Companies. The statutory
accounts for the 9 month period ended 31 December 2018 will be
delivered to the Registrar of Companies in due course.
The auditors' reports on the accounts for 31 December 2018 and
31 March 2018 were unqualified, did not draw attention to any
matters by way of emphasis, and did not contain a statement under
498(2) or 498(3) of the Companies Act 2006.
2. Changes in accounting policy
The following relevant standards, amendments and interpretations
to existing standards have been published and are mandatory for
accounting periods beginning after 1 January 2018:
IFRS 15 Revenue from Contracts with Customers
The following standard has been published and is mandatory for
accounting periods beginning after 1 January 2019.
IFRS 15 replaces IAS 18 Revenue effective 1 January 2018, the EU
has approved the standard. IFRS 15 provides a five step revenue
recognition model:
-- Identify the contract
-- Identify separate performance obligations
-- Determine the transaction price
-- Allocate the transaction price to separate performance obligations
-- Recognise revenue when the performance obligation is satisfied
The Group has four contract types; advertising revenue,
subscription fees and events revenue and research revenue.
Once the performance obligation(s) is established and the
transaction price is allocated (allocation is based on the contract
amount as agreed with the customer), revenue is recognised when (or
as) goods or services are transferred to a customer, this being
represented by transfer of control. Control in the context of IFRS
15 is the ability to direct the use of, and obtain substantially
all of the remaining benefits from, an asset. Indicators of such
include:
-- A present obligation to pay
-- Physical possession of the assets
-- Legal title
-- Risks and rewards ownership
-- Acceptance of the asset(s)
The Group has adopted IFRS 15 using the full retrospective
method, there was no adjustment required to either period presented
on transition. Practical expedients used were as follows:
-- The Group has not disclosed the allocation of the transaction
price to the remaining performance obligations to either reporting
period or disclosed when the revenue is expected to be recognised;
and
-- Contracts that started and ended within the same reporting
period have not been restated.
IFRS 9 Financial Instruments
IFRS 9 replaces IAS 39 Financial Instruments: Recognition and
Measurement bringing all three aspects of the accounting together
for financial instruments: classification and measurements;
impairment; and hedge accounting. The only change that impacts the
Group is the change in calculation of the expected credit loss
allowance and considerations are discussed below.
Impairment
The adoption of IFRS 9 Financial Instruments for period from 1
January 2018, resulted in a change of accounting policy however
there were no adjustments required through opening retained
earnings.
The Group applies the IFRS 9 simplified approach to measuring
expected credit losses which uses a lifetime expected loss
allowance for all trade receivables. To measure the expected credit
losses, trade receivables have been grouped based on similar aging.
The Group has concluded that the expected loss rates for trade
receivables, are a reasonable approximation of the loss rates for
each ageing category and customer based on historical debt
trends.
IFRS 16 Leases
This standard has been early adopted by the group and therefore
the lease held by InvestmentNews to rent their US office has been
accounted for in line with IFRS 16. The consolidated statement of
comprehensive income for the 9 month period to 31 December 2018
includes GBP0.015m of interest and GBP0.098m of amortisation of the
right to use asset in line with IFRS 16. Refer to Note 8 for
further details on the lease.
If the lease had been accounted for according to IAS 17, it
would have been treated as an operating lease and so the impact on
the consolidated statement of comprehensive income for the 9 month
period to 31 December 2018 would have been a rental expense of
GBP0.117m. Therefore the total impact of early adoption is to
reduce the loss for the period by GBP0.004m with an improvement of
GBP0.117m to EBITDA.
The weighted average incremental borrowing rate applied to lease
liabilities was 4%.
In applying the modified retrospective approach, the Group has
taken advantage of the following practical expedient:
-- Leases with a remaining term of 12 months or less from the
date of application have been accounted for as short-term leases
(i.e. not recognised on balance sheet) even though the initial term
of the leases from lease commencement date may have been more than
12 months.
3. Segmental analysis
For executive management purposes, the business has two
reportable segments being the Bonhill UK business and the
InvestmentNews business. Further analysis of revenue has been
performed by core proposition and country.
9 month period 12 month period
ended 31 December ended 31 March
2018 2018
GBP'000 GBP'000
Analysis of revenue by core propositions
Business information 5,433 670
Live events 2,080 1,936
Data and insight 478 -
------------------- ----------------
Total 7,991 2,606
------------------- ----------------
Analysis of revenue by country
United Kingdom 1,507 2,212
Europe 264 99
United States 6,220 295
------------------- ----------------
Total 7,991 2,606
------------------- ----------------
Of the above total Group revenue, GBP6.003m relates to revenue
generated by InvestmentNews.
9 months ended 31 December Bonhill UK InvestmentNews Total
2018 GBP'000 GBP'000 GBP'000
Reportable segmental income
statement
Revenue 1,998 6,003 7,991
Adjusted EBITDA (936) 1,551 889
Adjusted operating profit/(loss) (786) 1,452 666
Statutory operating profit/(loss) (2,353) 379 (1,974)
Statutory profit/(loss) before
tax (2,352) 232 (2,120)
12 months ended 31 March 2018 Bonhill UK InvestmentNews Total
GBP'000 GBP'000 GBP'000
Reportable segmental income
statement
Revenue 2,606 - 2,606
Adjusted EBITDA (393) - (393)
Adjusted operating profit/(loss) (438) - (438)
Statutory operating profit/(loss) (964) - (964)
Statutory profit/(loss) before
tax (971) - (971)
4. Operating loss
(a) Operating loss for the year has been arrived at after charging the following items:
12 month period
9 month period ended ended
31 December 2018 31 March 2018
GBP'000 GBP'000
Depreciation of property,
plant and equipment 20 6
Amortisation of purchased
or internally generated intangible
assets 135 39
Share based payment charge 68 -
Foreign exchange (gain) or (149) -
loss
Operating lease rentals in
respect of land and buildings 6 78
Staff costs 3,192 1,162
Directors' remuneration 385 384
Events costs 930 931
Impairment relating to expected
credit losses 21 6
Print related costs 832 74
Other costs 1,885 364
--------------------- ----------------
7,325 3,044
--------------------- ----------------
(b) During the year, the following services were obtained from
the Group's auditor as detailed below:
12 month period
9 month period ended ended
31 December 2018 31 March 2018
GBP'000 GBP'000
Audit services
- Recurring fees payable
to Company auditor for the
audit of parent Company and
consolidated accounts 28 29
- Additional fees payable 36 -
in relation to non-recurring
audit work
Other services
Fees payable to the company's
auditor and its associates
for other services:
- The audit of Company's
subsidiaries pursuant to
legislation 32 19
- Accounting work performed 346 -
in relation to acquisition
of InvestmentNews
- Tax work performed in relation 82 -
to acquisition of InvestmentNews
--------------------- ----------------
The disclosure of the auditor's remuneration stated above
relates to the Company's auditor, BDO LLP, and its associates.
(c) Adjusting items
The Group incurred certain costs in 2017 and 2018 which the
Directors believe should be disclosed as adjusting items as set out
below:
12 month period
9 month period ended ended
31 December 2018 31 March 2018
GBP'000 GBP'000
Write off relating to intangible
assets - 431
M&A costs (including legal
fees) 1,932 82
Integration costs 252 -
Loss on write off relating
to software - 15
Profit on disposal of historic
property, plant and equipment - (2)
Amortisation of intangibles 456 -
acquired through business
combination
--------------------- ----------------
2,640 526
--------------------- ----------------
The tax effect of the adjusting items is a credit of
GBP0.280m.
5. Reconciliation of adjusted EBITDA to statutory earnings
Earnings before interest, depreciation and amortisation
("EBITDA") is a measure of earnings and cash generative capacity.
Adjusted EBITDA, which excludes non-recurring items, facilitates an
understanding of underlying earnings and cash generative capacity.
A reconciliation of Adjusted EBITDA to statutory earnings is set
out below.
12 month period
9 month period ended ended
31 December 2018 31 March 2018
GBP'000 GBP'000
Adjusted EBITDA 889 (393)
Adjusting items (2,184) (95)
--------------------- ----------------
EBITDA (1,295) (488)
Depreciation (20) (6)
Amortisation and impairment (591) (470)
Share option charge (68) -
--------------------- ----------------
Operating loss (1,974) (964)
Net finance costs (146) (7)
--------------------- ----------------
Loss before tax (2,120) (971)
Taxation 280 -
--------------------- ----------------
Loss after tax (1,840) (971)
--------------------- ----------------
6. Earnings per share
(a) Basic earnings per share
Basic loss per share is calculated by dividing the loss
attributable to owners of the parent by the weighted average number
of ordinary shares in issue during the year.
Based on statutory earnings 12 month period
9 month period ended ended
31 December 2018 31 March 2018
GBP'000 GBP'000
Loss attributable to owners
of the parent (1,840) (971)
Weighted average number
of ordinary shares in issue 19,355,302 3,623,656
Basic earnings per share
(pence per share) (9.51p) (26.79p)
Basic earnings per share
(pence per share) - as
previously stated (0.67p)
Effect of prior period
adjustments and share re-organisation (26.12p)
--------------------- ----------------
Based on adjusted earnings 12 month period
9 month period ended ended
31 December 2018 31 March 2018
GBP'000 GBP'000
Profit attributable to
owners of the parent 520 (445)
Weighted average number
of ordinary shares in issue 19,355,302 3,623,656
Basic earnings per share
(pence per share) 2.69p (12.29p)
Basic earnings per share
(pence per share) - as
previously stated (0.35p)
Effect of prior period
adjustments and share re-organisation (11.94p)
--------------------- ----------------
(b) Diluted earnings per share
Based on statutory earnings 12 month period
9 month period ended ended
31 December 2018 31 March 2018
GBP'000 GBP'000
Loss attributable to owners
of the parent (1,840) (971)
Weighted average number
of ordinary shares in issue 19,355,302 3,623,656
Dilutive effect of "in
the money" share options 2,500
--------------------- ----------------
Diluted ordinary shares 19,355,302 3,626,156
Basic earnings per share
(pence per share) (9.51p) (26.77p)
Basic earnings per share
(pence per share) - as
previously stated (0.67p)
Effect of prior period
adjustments and share re-organisation (26.10p)
--------------------- ----------------
7. Called up share capital
Issued and fully paid ordinary shares of 1p each.
Number GBP'000
As at 31 March 2017 64,561,632 646
Shares issued during the
12 month period 107,500,000 1,075
-------------- --------
As at 31 March 2018 172,061,632 1,721
Administrative issue of 8 -
shares
Impact of 40:1 share re-organisation (167,760,099) (1,678)
Shares issued during the
9 month period 29,998,437 300
-------------- --------
As at 31 December 2018 34,299,978 343
-------------- --------
Deferred shares of 9p each.
Number GBP'000
As at 31 March 2017and 31
March 2018 25,603,787 2,304
Impact of 40:1 share re-organisation 18,640,011 1,678
Cancellation of deferred
shares (44,243,798) (3,982)
------------- --------
As at 31 December 2018 - -
------------- --------
8. Lease
The group has chosen to early adopt IFRS 16 and therefore
recognise a right-of-use asset and lease liability.
Right-of-use asset GBP'000
Carrying value as at 1 April 2018 -
Additions to right-of-use assets 1,066
Amortisation charged (98)
Foreign exchange impact of revaluation -
--------
Carrying value as at 31 December 2018 968
--------
Lease liability
Carrying value as at 1 April 2018 -
Additions to lease liability 1,066
Interest charged 15
Repayments made (65)
Foreign exchange impact of revaluation 2
--------
Carrying value as at 31 December 2018 1,018
--------
9. Notes to the cashflow
9 month period
ended 12 month period
31 December ended
2018 31 March 2018
GBP'000 GBP'000
Loss after tax (1,840) (971)
Adjustments for:
Tax (280) -
Finance costs 146 7
Loss on write off relating to software - 15
Profit on disposal of historic property,
plant and equipment - (2)
Amortisation and impairment 591 470
Depreciation or property, plant and
equipment 20 6
Share option charge 68 -
Other exceptional costs 2,184 -
Operating cash flows before movements
in working capital 889 (475)
Movement in receivables (2,520) 45
Movement in payables 1,230 (509)
CASH FLOWS (USED IN) / GENERATED
FROM OPERATIONS (401) (939)
--------------- ----------------
10. Acquisition of InvestmentNews
On 17 August 2018 the Group acquired 100% of InvestmentNews, a
US-based news, information and events business for a net
consideration of GBP12.867m in cash, a GBP4.720m vendor loan and
GBP3.052m taken as equity. This equity consisted of 3,815,338
shares at 80p per share. The principal reason for this acquisition
was to enhance the Group's market-leading position and further
develop the Group's events and data propositions.
Details of the fair value of identifiable assets and liabilities
acquired, purchase consideration and goodwill are as follows:
Fair value
Book value adjustments Total
Fair value of assets acquired GBP'000 GBP'000 GBP'000
Property, plant and equipment - 19 19
Intangibles - 9,338 9,338
Trade receivables 2,217 - 2,217
Other receivables/prepayments 135 (51) 84
Trade receivables (581) - (581)
Other payables/accruals (1,324) - (1,324)
Provisions (40) - (40)
Deferred tax liability - (2,442) (2,442)
------------- ------------- --------
Fair value of net assets
acquired 407 6,864 7,271
Goodwill 13,368
--------
Consideration 20,639
--------
Goodwill is attributable to the synergies expected to arise in
integrating the operations into the wider Group. Intangibles
included brands and customer relationships which will be amortised
over a period of 10 and 7 years respectively. US intangibles,
including goodwill, are expected to be deductible for tax purposes.
Trade receivables were GBP2.217m net of irrecoverable debt
provisions at acquisition of GBP0.095m.
The consideration comprised:
GBP'000
Cash consideration 12,867
Shares 3,052
Vendor loan 4,720
--------
20,639
--------
Since acquisition, InvestmentNews has contributed GBP6.003m to
revenue and GBP1.551m to adjusted EBITDA.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
FR JTMMTMBBTTPL
(END) Dow Jones Newswires
March 25, 2019 03:00 ET (07:00 GMT)
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