RNS Number:7802D
Capital Radio PLC
14 November 2002
PART 2
Group Profit and Loss Account
For the year ended 30th September 2002 Note 2002 2001
#000 #000
Turnover
Continuing operations 120,004 123,201
Discontinued operations - 11,386
2 120,004 134,587
Operating profit
Continuing operations
Before goodwill and exceptional operating costs 2 27,930 29,980
Exceptional operating costs 4 (3,576) (2,712)
Amortisation of goodwill 2 (9,372) (9,622)
14,982 17,646
Discontinued operations 2 - 2,689
Operating profit 3 14,982 20,335
Share of operating profit of associated companies 1,144 2,612
Total operating profit: Group and share of associates 16,126 22,947
Exceptional gain on disposal of investments - 10,215
Profit on ordinary activities before interest and taxation 2 16,126 33,162
Net interest payable and similar items from continuing operations 6 (1,477) (2,535)
Net interest payable and similar items from discontinued operations 6 - (2,775)
Underlying profit before taxation from continuing operations 4 27,762 30,057
Goodwill, exceptional items and discontinued operations 4 (13,113) (2,205)
Profit on ordinary activities before taxation 14,649 27,852
Taxation on profit on ordinary activities 8 (7,472) (8,381)
Profit on ordinary activities after taxation 7,177 19,471
Dividends 10 (15,197) (15,114)
Retained (loss)/profit for the financial year 19 (8,020) 4,357
Basic earnings per share 11 8.8p 23.8p
Loss per share on goodwill, exceptional items and discontinued operations 14.7p 2.5p
after taxation
Underlying basic earnings per share from continuing operations 11 23.5p 26.3p
Diluted earnings per share 11 8.8p 23.8p
Group Balance Sheet
30th September 2002
Note 2002 2001
#000 #000
Fixed assets
Intangible assets - goodwill 12 161,448 170,488
Tangible fixed assets 13 16,387 18,463
Investments 14 5,905 2,060
183,740 191,011
Current assets
Debtors 15 18,478 16,548
Cash at bank and in hand - 1,608
18,478 18,156
Creditors: amounts falling due within one year 16 (61,335) (54,862)
Net current liabilities (42,857) (36,706)
Total assets less current liabilities 140,883 154,305
Creditors: amounts falling due after more than one year 17 - (8,037)
Net assets 140,883 146,268
Capital and reserves
Called up share capital 18 2,055 2,044
Share premium account 19 75,516 72,589
Merger reserve 19 23,767 23,767
Profit and loss account 19 39,545 47,868
Equity shareholders' funds 140,883 146,268
Group Cash Flow Statement
For the year ended 30th September 2002 2002 2002 2001 2001
Note #000 #000 #000 #000
Net cash inflow from operating activities 20 30,081 34,816
Dividends from associated undertakings 1,029 1,309
31,110 36,125
Returns on investments and servicing of finance
Interest received and similar income 240 243
Interest paid (1,676) (6,182)
Net cash outflow from returns on investments
and servicing of finance (1,436) (5,939)
Taxation paid (6,128) (8,920)
Capital expenditure and financial investments
Proceeds from sale of tangible fixed assets 71 107
Purchase of tangible fixed assets (2,198) (3,922)
Purchase of fixed asset investments - (215)
Cash outflow on capital expenditure (2,127) (4,030)
Acquisitions and disposals 21 (2,644) 65,124
Cash outflow from equity dividends paid (15,141) (15,045)
Cash inflow before financing 3,634 67,315
Cash outflow from financing 22 (9,730) (59,303)
(Decrease)/increase in cash in the period (6,096) 8,012
Reconciliation of Net Cash Flow to Movement in Net Debt (note 23)
(Decrease)/increase in cash in the period (6,096) 8,012
Cash flow from decrease in debt 6,000 44,000
Change in net debt arising from cash flows (96) 52,012
Repayment of finance leases 227 557
Repayment of loan notes 3,771 15,253
Movement in net debt in the period 3,902 67,822
Net debt at 1st October (32,901) (100,723)
Net debt at 30th September 23 (28,999) (32,901)
Reconciliation of Movements in Shareholders' Funds
For the year ended 30th September 2002 2002 2001
GROUP #000 #000
Profit for the financial year 7,177 19,471
Dividends (15,197) (15,114)
Retained (loss)/profit for the financial year (8,020) 4,357
New share capital issued 2,938 509
Movement on Quest (303) -
Merger reserve movement - 685
Net (decrease)/increase in shareholders' funds (5,385) 5,551
Shareholders' funds at beginning of year 146,268 140,717
Shareholders' funds at end of year 140,883 146,268
For the year ended 30th September 2002 2002 2001
COMPANY #000 #000
Profit for the financial year (note 9) 10,964 16,530
Dividends (15,197) (15,114)
Retained (loss)/profit for the financial year (4,233) 1,416
New share capital issued 2,938 509
Movement on Quest 11 -
Merger reserve movement - 685
Net (decrease)/increase in shareholders' funds (1,284) 2,610
Shareholders' funds at beginning of year 176,031 173,421
Shareholders' funds at end of year 174,747 176,031
Statement of Group Total Recognised Gains and Losses
For the year ended 30th September 2002 2002 2001
GROUP #000 #000
Profit for the financial year:
Group 6,387 17,361
Share of associates 790 2,110
Total gains and losses recognised since last annual report 7,177 19,471
Company Balance Sheet
30th September 2002
Note 2002 2001
#000 #000
Fixed assets
Tangible fixed assets 13 9,401 10,917
Investments 14 245,947 241,531
255,348 252,448
Current assets
Debtors 15 50,364 49,314
50,364 49,314
Creditors: amounts falling due within one year 16 (130,965) (117,731)
Net current liabilities (80,601) (68,417)
Total assets less current liabilities 174,747 184,031
Creditors: amounts falling due after more than one year 17 - (8,000)
Net assets 174,747 176,031
Capital and reserves
Called up share capital 18 2,055 2,044
Share premium account 19 75,516 72,589
Revaluation reserve 19 429 429
Merger reserve 19 37,242 37,242
Profit and loss account 19 59,505 63,727
Equity shareholders' funds 174,747 176,031
Notes Forming Part of the Accounts
1. Accounting Policies
A summary of the principal Group accounting policies, all of which
have been applied consistently throughout the year, is set out below.
a. Basis of accounting
The accounts have been prepared under the historical cost accounting
rules and in accordance with applicable accounting standards,
including for the first time Financial Reporting Standard 19. The
introduction of this standard did not require a prior year adjustment
because the amount was deemed immaterial.
b. Basis of consolidation
(i) The consolidated accounts include the accounts of the Company
and its subsidiary undertakings made up to 30th September 2002.
Unless otherwise stated, the acquisition method of accounting has
been adopted. Under this method, the results of subsidiary
undertakings acquired or disposed of in the year are included in
the consolidated profit and loss account from the date of
acquisition or up to the date of disposal.
An associate is an undertaking in which the Group has a long term
interest, usually from 20% to 50% of the equity voting rights,
and over which it exercises significant influence. The Group's
share of the profits less losses of associates is included in the
consolidated profit and loss account and its interest in their
net assets is included in the consolidated balance sheet.
Other fixed asset investments in the Group accounts, and all
fixed assets in the accounts of the Company, are stated at cost
less amounts written off in respect of any impairment in value.
(ii) Purchased goodwill (both positive and negative) arising on
consolidation in respect of acquisitions before 1st October 1997,
when Financial Reporting Standard 10, Goodwill and intangible
assets, was adopted, was written off to reserves in the year of
acquisition. When a subsequent disposal occurs any related
goodwill previously written off to reserves is written back
through the profit and loss account as part of the profit or loss
on disposal.
Purchased goodwill (representing the excess of the fair value of
the consideration given and any related costs over the fair value
of the separable net assets acquired) arising on consolidation in
respect of acquisitions since 1st October 1997 is capitalised.
Positive goodwill is amortised to nil by equal annual instalments
over its estimated useful life, being deemed to be 20 years.
On the subsequent disposal or termination of a business acquired
since 1st October 1997, the profit or loss on disposal or
termination is calculated after charging/(crediting) the
unamortised amount of any related goodwill/(negative goodwill).
(iii) Under section 230(4) of the Companies Act 1985 the Company is
exempt from the requirement to present its own profit and loss
account. The profit for the financial year dealt with in the
financial statements of the holding company was #10,964,000
(2001: #16,530,000).
c. Tangible fixed assets
Tangible fixed assets are stated at cost less accumulated
depreciation. Depreciation is provided to write off the cost
(less estimated residual value) of each asset on a straight line
basis over its expected useful life, as follows:
Freehold buildings 2%-4% per annum
Long leasehold premises 4%-6% per annum
Short leasehold premises over the term of the lease, or where the lease is renewable, 5%
Office and studio equipment 10%-20% per annum
Digital equipment over the term of the contract
Computer equipment 33% per annum
Motor vehicles 25% per annum
Freehold land is not depreciated.
d. Investments
In the Company's accounts investments in subsidiary companies are
stated at cost less provisions where, in the opinion of the Directors, there has
been an impairment in the value of the investment. Dividends receivable from
subsidiary companies are credited to the Company's profit and loss account.
Fixed asset investments are stated at cost less provisions where, in the opinion
of the Directors, there has been an impairment in the value of the investment.
e. Taxation
Corporation tax payable is provided on taxable profits at the
current rate.
f. Deferred taxation
Financial Reporting Standard 19 requires full provision to be made for deferred
tax assets and liabilities arising from timing differences between recognition
in the financial statements and in the tax computation. The introduction of this
standard did not require a prior year adjustment because the amount was deemed
immaterial.
g. Operating leases
Rentals payable under operating leases are charged to the profit
and loss account on a straight line basis.
h. Finance leases
Assets held under finance lease agreements are included in tangible
fixed assets and are depreciated in accordance with the depreciation policy.
Obligations under such agreements are included in creditors net of finance
charges allocated to future periods. Finance charges are taken to the profit
and loss account so that the annual rate of charge on the outstanding obligation
at the end of each accounting period is approximately constant.
i. Turnover
Turnover comprises income from the sale of advertising airtime,
sponsorship and promotions (net of agencies' commissions) and income from
advertising on the Internet. Turnover is stated excluding VAT, trade discounts,
and intra group transactions and derives from goods and services provided in the
normal course of business. Airtime revenue is recognised on the date of
broadcast. Sponsorship revenue and internet advertising revenue are recognised
over the life of the contract.
j. Licences
Expenditure incurred on the purchase of licences and successful
applications and re-applications for licences is written off to the profit and
loss account as it is incurred.
k. Pensions
The Group provides for and funds pension liabilities on a going
concern basis, on the advice of external actuaries. The amount charged to the
profit and loss account is calculated to produce a level percentage of the
current and future pensionable payroll. The group has adopted the transitional
arrangements under Financial Reporting Standard 17, Retirement Benefits, and
these disclosures can be found in note 24.
l. Own shares held under trust
Shares in the Company issued to cover SAYE schemes are held in a
qualifying Share Ownership Trust (QUEST).
The cost of long term incentive plans for directors and senior executives is
charged to the profit and loss account over three years.
m. Capital Radio Restricted Share Plan ("the Plan")
Shares acquired by the Trustee of the Plan funded by the Company
and held for the continuing benefit of the Company are classified as fixed asset
investments until such time as the shares vest unconditionally in employees.
The cost of the shares is amortised to the profit and loss account as an
operating expense over three years. Any permanent diminution in value is
recognised immediately and is charged as an operating expense.
2. Segmental Information Turnover Profit before Net assets
interest and
taxation
2002 2001 2002 2001 2002 2001
#000 #000 #000 #000 #000 #000
Commercial Radio, all from UK:
Analogue 118,831 122,170 33,347 36,526
Digital 318 169 (3,295) (2,959)
Total Commercial Radio, all from UK: 119,149 122,339 30,052 33,567 180,125 191,060
Interactive, all from UK: 855 862 (2,122) (3,587) - -
Continuing operations before goodwill
and exceptional operating costs 120,004 123,201 27,930 29,980 180,125 191,060
Exceptional operating costs - - (3,576) (2,712) - -
Amortisation of goodwill (continuing) - - (9,372) (9,622) - -
Television (discontinued) - 11,386 - 2,689 - -
120,004 134,587 14,982 20,335 180,125 191,060
Share of operating profit of associated - - 1,144 2,612 5,472 2,013
companies
Exceptional gain on disposal of investments - - - 10,215 - -
Cash, overdrafts, loans and other - - - - (28,999) (32,901)
investments
Liabilities for taxation - - - - (5,136) (3,684)
Proposed dividend - - - - (10,276) (10,220)
120,004 134,587 16,126 33,162 141,186 146,268
Amortisation of goodwill relates to analogue commercial radio activities.
All exceptional costs relate to analogue commercial radio activities.
During the year the Group entered into Barter agreements worth #206,000.
This is accounted for in accordance with UITF 26.
3. Operating Profit 2002 Continuing Discontinued 2001
operations operations
#000 #000 #000 #000
Turnover 120,004 123,201 11,386 134,587
Direct costs (14,843) (14,930) (3,292) (18,222)
Gross profit 105,161 108,271 8,094 116,365
Staff costs (27,065) (27,302) (2,648) (29,950)
Other operating charges (46,583) (46,766) (1,959) (48,725)
Exceptional operating costs (3,576) (2,712) - (2,712)
Depreciation and amortisation (12,955) (13,845) (798) (14,643)
Operating profit 14,982 17,646 2,689 20,335
3 Operating Profit (continued)
2002 2001
Operating profit is stated after charging the following items: #000 #000
Hire of plant or machinery 921 997
Other operating lease charges 1,765 1,653
Auditors' remuneration - audit fees 99 108
Other fees paid to the auditors and their associates 51 392
(Profit)/loss on disposal of fixed assets (30) 26
Fees paid to the auditor for the audit of the Company amounted to #25,000 (2001:
#25,000). Auditors' fees have been reviewed by the Audit Committee.
4. Underlying Profit before Taxation from Continuing Operations
Underlying profit before taxation from continuing operations has been calculated
as follows: 2002 2001
#000 #000
Profit on ordinary activities before taxation 14,649 27,852
Continuing operations:
Abortive development costs - (1,458)
Restructuring costs (3,576) (1,254)
Total exceptional operating costs (3,576) (2,712)
Amortisation of goodwill - continuing operations (9,372) (9,622)
Amortisation of goodwill - associates (165) -
Exceptional gain on disposal of investments - continuing operations - 10,215
Discontinued operations:
Operating profit of television - 2,689
Related interest on discontinued operations - (2,775)
Net excluded items 13,113 2,205
Underlying profit before taxation from continuing operations 27,762 30,057
Restructuring costs in 2002 relate to costs incurred in re-aligning the Group's
operations along brand lines and into one commercial division. These costs
consist of redundancies, consultancy fees and fixed asset write-offs of
#319,000.
5. Staff 2002 2001
#000 #000
The aggregate payroll costs of the persons employed by the Group during the year
were as follows:
Wages and salaries 23,403 25,391
Social security costs 2,538 2,941
Other pension costs 1,124 1,618
27,065 29,950
Redundancy costs included within exceptional items 1,477 530
28,542 30,480
The above analysis includes the costs relating to Directors. The figures
exclude radio presenters engaged under short-term and part-time contracts. The
total cost of these persons amounts to #8,970,000 (2001: #8,575,000).
5. Staff (continued)
2002 2001
No. No.
The average number of persons employed by the Group (including Directors) during
the year was as follows:
Radio: Management and administration 171 174
Sales 304 318
Programming 159 162
Engineering 18 19
652 673
Interactive 35 58
Continuing operations 687 731
Television (discontinued) - 91
687 822
Details of individual directors' emoluments, pension entitlements, long term
incentive schemes and share options (including gains on exercise) are shown in
the Directors' Remuneration report.
6. Net Interest Payable and Similar Items 2002 2001
#000 #000
Interest receivable and similar income:
Bank interest 240 78
Bank interest attributable to associated undertakings 95 402
335 480
Interest payable and similar charges:
Bank loan and overdrafts, wholly repayable within 5 years (1,415) (1,553)
Interest on Capital Radio plc loan notes (338) (1,450)
Hire purchase, finance leases and other interest (19) (12)
Bank interest attributable to associated undertakings (40) -
(1,812) (3,015)
Interest payable by continuing operations (1,477) (2,535)
Interest payable by discontinued operations - (2,775)
(1,477) (5,310)
7. Acquisition of Choice FM
On the 25th October 2001 Capital Radio plc acquired 19% of Tainside Limited
(trading as Choice FM for #3,565,000). The net assets on acquisition amounted to
#261,000. The Group has applied associate accounting for this purchase. On the
same date the Group also signed a "Put and Call Option" to acquire the remaining
81% of Tainside Limited. The options can potentially be exercised between 30th
September 2004 and 29th September 2006. The current best estimate of the
possible additional consideration is in the range of #15,000,000 - #20,000,000
which will be settled predominantly in shares.
8. Taxation 2002 2002 2001 2001
#000 #000 #000 #000
Corporation tax at 30% 7,539 8,227
Share of associated companies' taxation 409 904
Adjustment relating to prior years 42 (750)
Total current tax 7,990 8,381
Deferred tax (see note 15)
Origination/reversal of timing differences (226) -
Adjustment in respect of previous years (292) -
(518) -
Tax on profit on ordinary activities 7,472 8,381
Factors affecting the tax charge for the year
The current tax charge for the year is higher (2001: higher) than the standard
rate of corporation tax in the UK of 30%. The differences are explained below.
2002 2001
#000 #000
Current tax reconciliation
Profit on ordinary activities before tax 14,649 27,852
Current tax at 30% (2001 : 30%) 4,395 8,356
Effects of:
Expenses not deductible for tax purposes:
Goodwill amortisation (including that in respect of associated undertakings) 2,861 2,887
Other 554 629
Depreciation for period in excess of capital allowances 171 78
Utilisation of tax losses (33) (2,819)
Adjustments to tax charge in respect of previous periods 42 (750)
Total current tax charge (see above) 7,990 8,381
9. Profit for the Financial Year
The profit for the financial year dealt with in the accounts of the Company was #10,964,000 (2001:
profit #16,530,000).
10. Dividends 2002 2001
#000 #000
Interim dividend of 6.0p (2001: 6.0p) per share, paid on 21st June 2002 4,921 4,894
Proposed final dividend of 12.5p (2001: 12.5p) per share, to be paid on 28th January 10,276 10,220
2003
Total dividend of 18.5p per share (2001: 18.5p) 15,197 15,114
11. Earnings Per Share
The calculation of earnings per share is based on the profit after taxation and minority interest of
#7,177,000 (2001: #19,471,000) and on the weighted average of 82,014,070 (2001: 81,729,926)
Ordinary Shares in issue during the year. The underlying earnings per share from continuing
operations is included to show the effect of adjusting for the impact of exceptional items, goodwill
and discontinued operations which result in earnings increasing by #13,113,000 (2001: #2,205,000).
After the effect of related tax credit of #977,000 (2001: #189,000), this results in earnings of
#19,313,000 (2001: #21,487,000).
12. Intangible Assets -
Goodwill
#000
GROUP
Book value
Beginning of year 191,804
Additions 332
End of year 192,136
Amortisation
Beginning of year 21,316
Provided during the 9,372
year
End of year 30,688
Net book value
Beginning of year 170,488
End of year 161,448
In February 2002 Capital Radio plc acquired Big AM.
13. Tangible Fixed Assets Land and Long Short Fixtures,
GROUP Freehold Leasehold Leasehold Fittings and Motor
Property Premises Premises Equipment Vehicles Total
#000 #000 #000 #000 #000 #000
Cost
Beginning of year 1,847 3,195 8,143 22,419 557 36,161
Reclassifications - (428) 428 - - -
Additions - 560 - 1,606 55 2,221
Disposals - - - - (154) (154)
End of year 1,847 3,327 8,571 24,025 458 38,228
Depreciation
Beginning of year 347 566 1,043 15,386 356 17,698
Charged in year 38 271 348 2,830 96 3,583
Reclassifications - (140) 140 354 - 354
Disposals - - - - (113) (113)
Impairment - - - 319 - 319
End of year 385 697 1,531 18,889 339 21,841
Net book value
Beginning of year 1,500 2,629 7,100 7,033 201 18,463
End of year 1,462 2,630 7,040 5,136 119 16,387
The net book value of assets held under finance leases by the Group amounted to
#61,000 (2001: #159,000). The depreciation charge in respect of these assets
amounted to #82,000 (2001: #85,000). The gross book value of freehold property
includes #1,488,000 (2001: #1,488,000) of depreciable assets.
Short Fixtures,
COMPANY Leasehold Fittings and Motor
Premises Equipment Vehicles Total
#000 #000 #000 #000
Cost
Beginning of year 8,087 18,341 319 26,747
Additions - 1,138 55 1,193
Disposals - - (45) (45)
End of year 8,087 19,479 329 27,895
Depreciation
Beginning of year 990 14,561 279 15,830
Charged in year 347 1,657 32 2,036
Reclassification - 354 - 354
Disposals - - (45) (45)
Impairment - 319 - 319
End of year 1,337 16,891 266 18,494
Net book value
Beginning of year 7,097 3,780 40 10,917
End of year 6,750 2,588 63 9,401
14. Fixed Asset Investments
Associated Other Own
GROUP Companies Investments Shares Total
#000 #000 #000 #000
Book value
Beginning of year 2,013 622 891 3,526
Additions 3,698 - 886 4,584
Disposal of investment - - (1,151) (1,151)
Share of retained losses (74) - - (74)
End of year 5,637 622 626 6,885
Provisions
Beginning of year - 575 891 1,466
Provided during the year - - 200 200
Amortisation of goodwill 165 - - 165
Disposal of investment - - (851) (851)
End of year 165 575 240 980
Net book value
Beginning of year 2,013 47 - 2,060
End of year 5,472 47 386 5,905
Fixed asset investments comprise:
At the beginning of the year
Unlisted investments 2,013 47 - 2,060
Listed investments - - - -
Total 2,013 47 - 2,060
At the end of the year
Unlisted investments 5,472 47 - 5,519
Listed investments - - 386 386
Total 5,472 47 386 5,905
Market value of listed investments
At beginning of year - - 317 317
At end of year - - 463 463
Included within Associated Companies is goodwill of #3,139,000 which arose on
the acquisition of 19% of Choice FM (Tainside Limited).
14. Fixed Asset Investments (continued)
Subsidiary Associated Other Own
Companies Companies Investments Shares Total
#000 #000 #000 #000 #000
COMPANY
Book value
Beginning of year 293,238 1,103 614 891 295,846
Additions 332 3,698 - 886 4,916
Disposals - - - (1,151) (1,151)
End of year 293,570 4,801 614 626 299,611
Provisions
Beginning of year 52,437 415 572 891 54,315
Provided during the year - - - 200 200
Disposal of investment - - - (851) (851)
End of year 52,437 415 572 240 53,664
Net book value
Beginning of year 240,801 688 42 - 241,531
End of year 241,133 4,386 42 386 245,947
Fixed asset investments comprise:
At beginning of year
Unlisted investments 240,801 688 42 - 241,531
Listed investments - - - - -
Total 240,801 688 42 - 241,531
At the end of the year
Unlisted investments 241,133 4,386 42 - 245,561
Listed investments - - - 386 386
Total 241,133 4,386 42 386 245,947
Own Shares in both the Group and Company represents shares in Capital Radio plc
acquired by the Trustee of the Capital Radio Restricted Share Plan to satisfy
potential future obligations to award shares under the Plan. In accordance with
guidance given by the Urgent Issues Task Force the cost of these shares is
amortised over three years, being the period of service in respect of which
conditional awards have been made.
15. Debtors Group Company
2002 2001 2002 2001
#000 #000 #000 #000
Amounts falling due within one year:
Trade debtors 11,604 11,893 11,604 11,726
Amounts due from subsidiary companies - - 34,281 34,321
Deferred tax (see below) 518 - 95 -
Other debtors 761 391 542 93
Prepayments and accrued income 4,643 3,395 2,890 2,305
17,526 15,679 49,412 48,445
Amounts falling after more than one year:
Prepayments and accrued income 952 869 952 869
952 869 952 869
Total 18,478 16,548 50,364 49,314
Group Company
#000 #000
Deferred tax
At 1 October 2001 - -
Profit and loss account 518 95
At 30 September 2002 518 95
Deferred tax provided in the accounts, which represents the total potential
asset for deferred taxation, is as follows:
Group Group Company Company
2002 2001 2002 2001
#000 #000 #000 #000
Accelerated capital allowances 67 - (192) -
Other timing differences 352 - 287 -
Tax losses 99 - - -
Deferred tax asset 518 - 95 -
No account has been taken of UK tax losses which are not expected to be utilised
in the foreseeable future. The total amount unprovided in respect of these
losses is #1,300,000 (2001: #1,300,000).
16. Creditors: Amounts falling due within one year
Group Company
2002 2001 2002 2001
#000 #000 #000 #000
Bank loans and overdrafts 22,988 16,500 23,002 14,770
Loan notes (see note below) 5,980 9,751 5,980 9,751
Finance leases 31 221 - -
Trade creditors 5,724 4,572 5,190 4,182
Other creditors 4,148 4,840 3,660 5,379
Amounts due to subsidiary undertakings - - 78,182 66,644
Corporation tax payable 5,136 3,684 113 3,591
Proposed dividend 10,276 10,220 10,276 10,220
Other taxation and social security 2,340 2,372 2,340 2,302
Accruals and deferred income 4,712 2,702 2,222 892
61,335 54,862 130,965 117,731
Capital Radio plc loan notes
Capital Radio plc loan notes amounting to #420,000 (2001: #450,000) were issued
in July 1998 and have a five year term. Interest is paid six monthly in arrears
at 1% below London Inter-Bank Offered Rates. The loan notes may be redeemed at
the holder's option on interest dates until 2003, or by the Company on 31 July
2003.
Capital Radio plc loan notes amounting to #5,426,000 (2001: #6,001,000) were
issued in June 2001 and have a five year term. Interest is paid six monthly in
arrears at 1% below London Inter-Bank Offered Rates. The loan notes may be
redeemed at the holder's option on interest dates until 2005, or by the Company
on 31 March 2005.
Capital Radio plc loan notes amounting to #134,000 (2001: #3,300,000) were
issued in August 2001 and have a five year term. Interest is paid six monthly in
arrears at 1% below London Inter-Bank Offered Rates. The loan notes may be
redeemed at the holder's option on interest dates until 2005, or by the Company
on 31 March 2005.
17. Creditors: Amounts falling due after more than one year Group Company
2002 2001 2002 2001
#000 #000 #000 #000
Bank loans falling due after more than one year and less than two years - 8,000 - 8,000
Finance leases falling due after more than one year and less than two years - 37 - -
- 8,037 - 8,000
18. Share Capital 2002 2001
#000 #000
Authorised 100,000,000 (2001: 100,000,000) Ordinary Shares of 2.5p each 2,500 2,500
Allotted, called-up and fully paid 82,211,330 (2001: 81,759,799) Ordinary
shares of 2.5p each 2,055 2,044
The increase in the issued share capital was due to: Number Number
Ordinary Shares of 2.5p each issued fully paid during the year:
- on acquisitions 260,253 68,844
- on issue of own shares to LTIP 133,700 -
- on exercise of option rights 57,578 94,170
451,531 163,014
The shares issued on acquisition of Tainside Limited were issued at
#6.85 per share.
18. Share Capital (continued)
At 30th September 2002, the Company had options outstanding to
subscribe for 2,750,204 (2001: 2,201,735) ordinary shares. Details of the
outstanding options are as follows:
Option Number of Exercise Exercisable
Shares Price Not
Grant Date Under Option (pence) Earlier Than
Capital Radio 1986 Senior Executive Share Option Scheme
July 1993 10,348 172 July 1996
December 1994 24,100 332 December 1997
December 1996 24,300 540 December 1999
Capital Radio Savings Related Share Option Scheme
December 1997 44,771 389 February 2003
December 1998 29,595 448 February 2004
December 1999 33,899 897 February 2005
December 2000 16,770 1054 February 2006
December 2001 152,258 614 February 2007
Capital Radio 1998 Share Option Scheme
March 1998 192,905 633 March 2001
November 1998 290,230 541 November 2001
June 1999 61,194 865 May 2002
November 1999 242,812 1224 November 2002
May 2000 83,926 1262 May 2003
November 2000 331,934 1172 November 2003
December 2000 16,204 1172 December 2003
February 2001 82,219 1080 February 2004
May 2001 141,638 795 May 2004
November 2001 443,970 815 November 2004
January 2002 109,059 705 January 2005
May 2002 119,489 773 May 2005
June 2002 54,264 645 June 2005
July 2002 79,734 668 July 2005
Capital Radio Presenters Share Option Scheme
March 2000 54,794 1825 March 2003
December 2000 40,358 1115 December 2003
July 2001 38,759 645 July 2004
November 2001 30,674 815 November 2004
During the year, options over 94,671 Ordinary Shares of 2.5p each were
exercised, of which 37,093 were issued through the "Quest", for a total
consideration of #164,000, resulting in an increase in the share premium account
of #267,000. Options over 346,308 shares lapsed during the year. Share options
under the Capital Radio 1986 Senior Executive Share Option Scheme and the
Capital Radio 1998 Share Option Scheme and the Capital Radio Presenters Share
Option Scheme expire ten years after the date of grant. Options under the
Capital Radio Savings Related Share Option Scheme expire six months after the
date on which they can first be exercised.
19. Reserves Profit
Share Revaluation Merger and Loss
Premium Reserve Reserve Account
#000 #000 #000 #000
The movement on reserves during the year
was as follows:
Group
Beginning of year 72,589 - 23,767 47,868
Retained loss for the year - - - (8,020)
Movement on Quest - - - (303)
Premium arising on issue of shares 2,927 - - -
End of year 75,516 - 23,767 39,545
Company
Beginning of year 72,589 429 37,242 63,727
Retained loss for the year - - - (4,233)
Movement on Quest - - - 11
Premium arising on issue of shares 2,927 - - -
End of year 75,516 429 37,242 59,505
The cumulative total of goodwill written off against the Group
profit and loss account reserve in respect of acquisitions prior to
1st October 1997, when Financial Reporting Standard 10: Goodwill and
Intangible Assets was adopted, amounts to #45,941,000 (2001: #45,941,000).
20. Reconciliation of Operating Profit to Net Cash
Inflow from Operating Activities 2002 2001
#000 #000
Operating profit 14,982 20,335
Depreciation 4,256 5,021
Amortisation and impairment of goodwill 9,372 9,622
(Profit)/loss on disposal of tangible fixed assets (30) 26
(Increase)/decrease in debtors (1,412) 2,745
Increase/(decrease) in creditors 2,713 (2,933)
Change in provisions against investments in own shares 200 -
Net cash inflow from operating activities 30,081 34,816
21. Cash flows from acquisitions and disposals 2002 2001
#000 #000
Net cash disposed of with subsidiary - (233)
Net cash acquired with subsidiary - 456
Net (cost)/proceeds from sale of Border Television Plc (397) 50,500
Net Proceeds from sale of other investments - 12,471
Purchase of fixed asset investments (2,247) -
Repayment of investment loan - 1,930
Net cash (inflow)/outflow from acquisitions and (2,644) 65,124
disposals
22. Cash Flows from Financing 2002 2001
#000 #000
Proceeds from issue of shares 268 507
Bank loans - 14,000
Repayment of bank loans (6,000) (58,000)
Repayment of loan notes (3,771) (15,253)
Capital element of finance leases (227) (557)
Net cash outflow from financing (9,730) (59,303)
23. Analysis of Net Debt Net Debt at Cash Other Non- Net Debt at
1st October Flow Cash Changes 30th September
2001 2002
#000 #000 #000 #000
Cash at bank 1,608 (1,608) - -
Bank loans and overdrafts - (4,488) - (4,488)
1,608 (6,096) - (4,488)
Bank loans falling due in less than one (16,500) 6,000 (8,000) (18,500)
year
Bank loans falling due in more than one (8,000) - 8,000 -
year
Loan notes (9,751) 3,771 - (5,980)
Finance leases (258) 227 - (31)
(34,509) 9,998 - (24,511)
(32,901) 3,902 - (28,999)
24. Pension Funds
The Group operates three pension schemes and participates in a
fourth scheme on behalf of its employees. The Capital Radio Plc Pension and
Assurance Scheme (CRPPAS) and the Midlands Radio Group Pension Scheme (MRGPS)
are contributory defined benefit schemes. Both schemes were closed to new
employees from 31st March 1995. At 30th September 2002, 21 employees of Capital
Radio plc and 7 employees of Birmingham Broadcasting Limited respectively were
active members of these schemes. All other employees in the Radio Group, and in
particular new employees, are eligible to join the Capital Radio Group Personal
Pension Plan, which was established on 1st April 1995. This scheme is a
contributory defined contribution arrangement and as at 30th September 2002, 252
employees were active members of this scheme. The Group makes age related
contributions to the scheme.
For both defined benefits schemes, the assets are held separately
from those of the Group, being invested with insurance companies. Independent
actuarial valuations are obtained every third year. Contributions to the pension
schemes are made in accordance with advice given by independent qualified
actuaries.
Details of the most recent Actuarial valuations of the defined
benefit pension schemes, insofar as they relate to the Group, are as follows:
MRGPS CRPPAS
Date of last valuation 30th September 2000 1st April 1999
Method used Minimum Funding Requirement (MFR) Attained Age
Assumptions:
Annual salary increase 6% 6%
Annual investment return before
retirement 9% 7.5%
Annual investment return after
retirement 9% 6.5%
Market value of scheme assets #3,638,000 #7,277,000
Percentage of liabilities 84% 92%
A new valuation for the CRPPAS is currently being finalised.
Under the MFR method of valuation, the current service cost of
members will increase as members approach retirement.
The contribution to the CRPPAS made by the Company in the year was
#275,000. The Company has agreed to redress the deficit over five years at the
funding rate of 22% (plus the cost of insured death in service benefits) as
recommended by the actuary.
The contribution to the MRGPS made by the Company in the year was
#325,000. The Company has agreed to redress the deficit over five years at the
funding rate of 14% of pensionable salaries plus #22,800 per month for eighteen
months, and #7,600 per month for a further three years as recommended by the
actuary.
Additional disclosures in accordance with FRS17
An actuarial estimate performed by independent qualified actuaries, based on the
last full valuations as above, has been undertaken to provide the information
required for FRS 17 as at 30th September 2002:
The major assumptions used by the actuary were:
MRGPS and CRPPAS MRGPS and CRPPAS
30th September 2002 30th September 2001
Rate of increase in salaries 4.00% 4.25%
Rate of increase in pensions in payment 3.00% 3.00%
Discount rate 5.40% 6.00%
Inflation assumption 2.25% 2.50%
24. Pension Funds (continued)
The assets in the Scheme and the expected rates of return were:
Long term rate of Value at 30th Long term rate of Value at 30th
return expected at 30th September 2002 return expected at September 2001
Assets in the September 2002 30th September 2001
Scheme #000 #000
MRGPS CRPPAS MRGPS CRPPAS MRGPS CRPPAS MRGPS CRPPAS
Equities 7.0% 7.5% 1,756 3,661 7.0% 6.5% 2,210 3,393
Gilts 4.5% 5.0% 723 2,651 6.0% 6.5% 157 3,393
Cash/other 4.0% 5.4% 248 2,191 5.0% 6.0% 512 1,563
2,727 8,503 2,879 8,349
The following amounts at 30th September 2001 and 30th September 2002 were
measured in accordance with the requirements of FRS 17:
2002 2001
#000 #000
MRGPS CRPPAS MRGPS CRPPAS
Total market value of assets 2,727 8,503 2,879 8,349
Present value of Scheme liabilities (5,255) (12,042) (4,474) (10,025)
Deficit in Scheme (2,528) (3,539) (1,595) (1,676)
Related deferred tax asset 758 1,062 478 503
Net pension deficit (1,770) (2,477) (1,117) (1,173)
If the above amounts had been recognised in the financial statements, the
Company's net assets and profit and loss reserve at 30th September 2002 and 30th
September 2001 would be as follows:
2002 2001
#000 #000
Net assets excluding pension deficit 140,883 146,268
Pension deficit - MRGPS (1,770) (1,117)
Pension deficit - CRPPAS (2,477) (1,173)
Net assets including pension deficit 136,636 143,978
Profit and loss reserve excluding pension deficit 39,545 47,868
Pension reserve - MRGPS (1,770) (1,117)
Pension reserve - CRPPAS (2,477) (1,173)
Profit and loss reserve 35,298 45,578
The following amounts would have been recognised in the performance statements
in the year to 30th September 2002 under the requirements of FRS 17:
#000
Operating profit MRGPS CRPPAS
Current service cost (81) (194)
Past service cost - -
Total operating charge (81) (194)
Other finance income:
Expected return on pension scheme assets 189 511
Interest on pension scheme liabilities (271) (595)
Net return (82) (84)
#000
Statement of total recognised gains and losses MRGPS CRPPAS
Actual return less expected return on pension scheme assets (341) (329)
Experience gains and losses on pension scheme liabilities (268) (35)
Change in assumptions underlying pension scheme liabilities (486) (1,496)
Actuarial gains and losses in STRGL (1,095) (1,860)
24. Pension Funds (continued)
#000
Movement in deficit during the year MRGPS CRPPAS
Deficit in Scheme at beginning of year (1,595) (1,676)
Movement in year:
Current service cost (81) (194)
Contributions 325 275
Past service costs - -
Other finance income (82) (84)
Actuarial gain (1,095) (1,860)
Deficit in Scheme at end of year (2,528) (3,539)
Details of experience gains/losses for year to 30th September 2002
Difference between actual and expected return on assets
Amount (341) (329)
Percentage of Scheme assets (12.5%) (3.9%)
Experience gains and losses on Scheme liabilities
Amount (242) (35)
Percentage of the present value of the Scheme liabilities (4.6%) (0.0%)
Total amount recognised in statement of total recognised gains and losses:
Amount (1,095) (1,860)
Percentage of the present value of the Scheme liabilities (20.8%) (21.9%)
In accordance with the transitional arrangements of FRS 17, the deficits on the
above schemes have not been recognised in the accounts.
The total pension cost for the period was #1,124,000 (2001: #1,618,000).
Pension costs for the two defined benefit schemes are charged to the profit and
loss account so as to spread the cost of pensions over employees' working lives
with the Group. The pensions charge for the other schemes represents the
contributions paid. The outstanding debtor to pensions schemes at 30th September
2002 was #102,000 (2001: creditor #87,000).
25. Financial Commitments
Annual operating lease commitments for the year to 30th September
2002 analysed by expiry date are as follows:
Land and Land and
Buildings Other Buildings Other
2002 2002 2001 2001
GROUP #000 #000 #000 #000
Less than one year - 105 - 160
Within one to two years - 357 - 194
Within three to five years - 221 - 365
In more than five years 2,016 - 2,086 -
2,016 683 2,086 719
COMPANY
Less than one year - 20 - 30
Within one to two years - 38 - 55
Within three to five years - 55 - 36
In more than five years 1,461 - 1,532 -
1,461 113 1,532 121
Contracted capital expenditure at 30th September not 2002 2001
provided for in the accounts amounts to: #000 #000
Group - -
Company - -
26. Contingent Liabilities
Neither the Group nor the Company had any material contingent
liabilities at 30th September 2002 or 2001. The Company has given its bankers
a cross guarantee to secure the bank borrowings of the other Group undertakings
(see note 28). This guarantee is secured by a fixed and floating charge over
all the assets of the Company. The Directors do not anticipate that any
liability will fall on the Company in respect of this guarantee.
27. Related Parties
The Group has trading relationships with Independent Radio News
Limited ("IRN") and the Radio Advertising Bureau Limited ("RAB"). The Group
holds significant shareholdings in both of these companies and has
representatives on their boards of directors, and is therefore in a position to
exercise significant influence over these companies. All transactions were
conducted at normal commercial rates.
IRN supplies the UK radio industry with a news service in return
for airtime adjacent to news bulletins. This airtime is sold as the "Newslink"
national advertising product by Capital Advertising, as agent for IRN. An
element of the profits of IRN is repaid to participating stations as a payment
for airtime given. The Group also supplies accounting services to IRN. During
the year the Group received #2,232,000 (2001: #2,251,000) of income from IRN,
representing Capital Advertising commission income, airtime rebate and payment
for accounting services. The value of airtime transferred to IRN during the
year was #2,298,000 (2001: #2,475,000). At 30th September 2002 there was an
outstanding debtor from IRN of #650,000 (2001: #604,000).
The RAB is a trade body promoting commercial radio with
advertisers. The RAB is funded by levies paid by the commercial radio industry
in the UK based on volumes of advertising. During the year the Group paid
#832,000 (2001: #897,000) in levies to the RAB and at 30 September 2002 had an
outstanding creditor of #34,000 (2001: #72,000).
Wildstar Records Limited is a record label. At 30 September 2002
there were no outstanding debtors or creditors to the Group.
CE Digital operates three local digital radio multiplexes. During
the year the Group paid #844,000 (2001: #804,000) to CE Digital in respect of
radio broadcasts and received #nil (2001: #170,000) from CE Digital in respect
of legal expertise and engineering time. At 30 September 2002 there was an
outstanding creditor of #254,000 (2001: debtor of #201,000).
Tainside Limited operates a commercial radio station (Choice FM).
At 30 September 2002 there were no outstanding debtors or creditors to the
Group.
28. Derivatives and other financial instruments
Short term debtors and creditors that meet the definition of a
financial asset or liability under Financial Reporting Standard 13 have been
excluded from the disclosures as permitted by the Standard.
Interest rate profile of financial assets and financial
liabilities:
Financial assets
The interest rate risk profile of the financial assets of the
Group as at 30th September 2002 was as follows:
2002 2001
#000 #000
Cash at floating interest rate - 1,608
Debtors due after more than one year 952 869
Unlisted investments 47 47
999 2,524
The weighted average interest rate for cash at 30th September 2002 was 4%.
Financial liabilities
The Group's floating rate financial liabilities which had a weighted average
interest rate at the year end of 4.4%, consist of:
2002 2001
#000 #000
Bank overdraft 4,488 -
Bank loans 18,500 24,500
Loan notes 5,980 9,751
Finance leases 31 258
28,999 34,509
The floating rate bank loans carry interest at 0.6% over LIBOR and
are repayable in instalments over three years ending on 30th June 2003. Bank
overdrafts carry interest at 1% over bank base rate and are repayable on demand.
The loan notes carry interest at 1% below bank base rate and are redeemable by
the holders on interest dates or by the Company on dates ranging from 31st July
2003 to 31st March 2005.
The maturity profile of the Group's financial liabilities at 30th September 2002
was as follows:
2002 2001
#000 #000
In one year or less, or on demand 28,999 26,472
In more than one year but not more than two years - 8,037
In more than two years but not more than five years - -
28,999 34,509
Borrowing facilities
The Group has various undrawn committed borrowing facilities. The
undrawn facilities available at 30th September 2002 in respect of which all
conditions precedent have been met were as follows:
2002 2001
#000 #000
Expiring in one year or less 35,512 40,500
Fair value financial assets and financial liabilities
There are no material differences between the carrying values and the fair
values of the financial assets and financial liabilities disclosed above.
Principal Investments
At 30th September 2002 the principal investments of the group were as stated
below. All the holdings are of ordinary shares, and are shown to the nearest
whole percentage.
Proportion of
Shares held by:
Principal Activity The Company Subsidiaries Total
Principal subsidiary undertakings
Beat 106 Limited Commercial radio 100% - 100%
Birmingham Broadcasting Limited Commercial radio - 100% 100%
Capital Radio Management Limited Commercial radio - 100% 100%
Cardiff Broadcasting Company Limited Commercial radio 100% - 100%
Century Radio Limited Commercial radio - 100% 100%
Century 105 Limited Commercial radio - 100% 100%
Century 106 Limited Commercial radio - 100% 100%
First Oxfordshire Radio Company Limited Commercial radio 40% 60% 100%
Radio Invicta Limited Commercial radio - 100% 100%
Southern Radio Limited Commercial radio - 100% 100%
The Ocean Radio Group Limited Commercial radio - 100% 100%
Xfm Limited Commercial radio 100% - 100%
Capital Radio Digital Limited Commercial digital radio 100% - 100%
Midlands Radio plc Holding company 100% - 100%
Southern Radio Group Limited Holding company 100% - 100%
Capital Radio Investments Limited Investment company 100% - 100%
Capital Radio UBC Data Limited Commercial digital data 70% - 70%
(Issued share capital :#100,000)
Principal associated undertakings
Independent Radio News Limited Programme production 37% 9% 46%
(Issued share capital: #374,535)
Radio Advertising Bureau Limited Marketing of commercial 30% 15% 45%
(Issued share capital: #50,000)
Wildstar Records Limited Record production 50% - 50%
(Issued share capital :#600,000)
CE Digital Limited Commercial digital radio - 50% 50%
(Issued share capital :#2)
Digital News Network Limited Commercial radio 22% - 22%
(Issued share capital :#600,000)
Tainside Limited Commercial radio 19% - 19%
(Issued share capital :#1,089,193)
All principle investments are incorporated in England and Wales except Beat 106
Limited, which is incorporated in Scotland.
Financial Record and Key Statistics
2002 2001 2000 1999 1998
Restated Restated Restated
Profit & Loss
Turnover from continuing operations # million 120.0 123.2 124.9 105.8 94.0
Operating profit before taxation from continuing
operations and exceptional items # million 27.9 30.0 39.9 38.4 34.8
As a percentage of turnover 23% 24% 32% 36% 37%
Underlying profit before taxation from continuing
operations
# million 27.8 30.1 41.2 37.7 35.4
Commercial radio - Analogue
Turnover # million 118.8 122.2 123.9 105.2 93.0
Underlying profit before taxation # million 33.3 36.5 45.4 39.7 35.6
As a percentage of turnover 28% 30% 37% 38% 38%
Balance Sheet
Net debt # million (29.0) (32.9) (100.7) (1.2) (16.2)
Net assets employed # million 140.9 146.3 141.1 42.4 48.8
Cash Flow
Net cash inflow from operating activities # million 30.1 34.8 44.4 45.0 39.7
Ordinary shares
Underlying earnings per share from continuing operations 23.5 26.3 39.2 35.2 33.0
pence
Dividends per share pence 18.50 18.50 18.50 16.65 15.25
Dividend cover times 1.3 1.4 2.1 2.1 2.2
Shares in issue at 30 September million 82.2 81.8 81.6 74.5 74.2
Share price # during year High 8.48 15.05 19.53 9.50 7.44
Low 4.53 4.83 8.85 4.36 4.52
Share price at 30 September # 4.90 5.20 14.38 8.85 4.67
Market capitalisation at 30 September # million 403 425 1,173 659 346
Average employees in continuing operations number 687 731 625 536 539
Notes
1. The underlying operating profit from continuing operations,
underlying profit before taxation from continuing operations and underlying
earnings per share from continuing operations figures are stated after
eliminating the effect of significant non-recurring items, goodwill and
discontinued operations.
2. Net debt represents the net total of cash at bank, loan notes,
overdrafts and short term lease finance debt, plus short term investments.
3. Dividend cover is calculated using underlying earnings per share from
continuing operations.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR EAFFDFLKAFAE
Clean Air (LSE:CAP)
Historical Stock Chart
From May 2024 to Jun 2024
Clean Air (LSE:CAP)
Historical Stock Chart
From Jun 2023 to Jun 2024
