Final Results
April 27 2006 - 5:33AM
UK Regulatory
1
Stockcube Plc ("Stockcube" or "the Company")
Preliminary Results for the year ended 31 December 2005
Highlights
2005 2004
�000 �000
Turnover 2,420 2,430
Profit before tax, impairment and amortisation of 433 230
goodwill
Profit before tax 251 201
Profit after tax 164 156
Earnings before impairment - pence per share 0.33p 0.16p
Earnings - pence per share 0.17p 0.16p
* Group turnover slightly down on last year.
* Profit before tax, impairment and amortisation of goodwill up 88% to �433,000.
* Profit before tax up 25% to �251,000.
* All elements of business show satisfactory performances.
* Strong balance sheet with net assets of 4.5p per share, of which 4.0p is cash and short-term
deposits.
* Earnings per share before impairment up 106% to 0.33p and after impairment up 6% to 0.17p.
* Dividend (proposed) increased by 50% to 0.075 pence per share.
Julian Burney, Chief Executive Officer, said:
"We have made considerable advances in all aspects of our business during 2005, which are reflected
in our profit before impairment and goodwill but not yet reflected in reported turnover. However,
attention to cost control and cost efficiencies has enabled us to report an increase of 88% in
profit before tax and impairment and goodwill and an increase of 94% in earnings per share before
impairment.
"During the year we upgraded our specialist hedge fund services which ,together with favourable
regulatory change, gives us great confidence in our professional consultancy. We have capacity to
expand this business without significant additional cost. Our institutional services team is maturing
nicely; our analytical expertise and client relationships are now more widely distributed within our
business than at any other time.
"We have also been greatly encouraged by the growth in numbers of subscribers for our wider market
services and in the revenues arising from our business-to-business relationships with third party
stockbrokers for whom we contribute an integral component of their own research.
"Our technology business, Ecube, is building very good foundations in the financial services sector
combining bespoke functionality with Stockcube's technical research and analysis."
For further information:
Stockcube Julian Burney 020-7352-4001
Corporate Synergy Katie Ratner/David Seal/Luke Ahern 020-7448-4430
Chairman's Statement
Introduction
We continued our progress to establish Stockcube as a leading provider of financial research and
analysis for global investors.
Financial review
Turnover for the year ended 31 December 2005 was �2,420,000 - a slight decrease of 0.4% on last year
(2004: �2,430,000). Profit before tax, goodwill and the exceptional impairment charge for Sportcal,
was �433,000, generating a very encouraging increase of 88% over 2004 (�230,000). Basic earnings per
share, before impairment, were 0.33p per 1p ordinary share giving an increase of 106% over 2004.
Earnings per share after impairment increased by 6% to 0.17p (2004: 0.16p). The impairment provision
will not qualify for relief from corporation tax until actually realised.
Our balance sheet is as strong as ever with net assets of 4.5p per share, of which 4.0p is held in
cash at 31 December 2005.
Operations
Turnover from Stockcube Research, our stock market and sector analysis consultancy for institutional
investors, reported an 8% drop from 2004, in line with our budget expectations. Such modest
variations are not surprising in view of the size of some of our individual accounts and the diverse
reactions of these clients to changing market conditions. We have now established the core of an
excellent team of young, motivated analysts whose expertise in defined markets and reputations for
making valuable market calls is growing apace. Our capacity to service a number of larger individual
accounts has thereby been considerably increased and we are confident that this team will attract and
retain significant new business going forward.
Last year's change in Fullermoney from monthly hardcopy to daily on-line and audio formats is
beginning to show good results with a net 20% growth in subscriptions during the year. The enhanced
immediacy of this service has also enabled us to increase subscription prices, generating a 25%
increase in income whilst removing distribution costs completely. The net growth in subscriptions is
continuing in the current year. Our bi-annual Chart Seminars held in London continue to sell-out and
our bespoke consultancy for in-house training is developing satisfactorily.
Investors Intelligence online produced a very pleasing 37% increase in the number of individual
subscriptions in 2005. In addition, we continue to pursue our strategy of seeking distribution
partners for our analysis work. By building and powering online research 'microsites', bespoke stock
universes and analysis tools for third party stockbrokers, we are enabling them to provide their own
clients with daily technical market signals and stock analysis. Our own label subscription and white
label 'B2B' models have together generated an encouraging increase of 51% in income during the year.
Income for our US subsidiary, Chartcraft, in sterling terms, was the same as 2004 although its
contribution to group profits was down by 14% on 2004.
Ecube, our in-house software business, continues to extend its expertise and customer base through
development and installation of third party data microsites through the Investors Intelligence brand
and through repeat business with third party financial and non-financial services businesses. Ecube
reported a 13% increase in pure third party development and web-hosting income in 2005.
Staff
I should like to thank all our staff for their continued contribution during the year.
Dividend
We are pleased to seek shareholder approval for a dividend of 0.075 pence per 1p ordinary share in
respect of the results for 2005, an increase of 50% over 2004. The Company's Annual General Meeting
will be held on 24 May 2006 at Unit 1.23, Plaza 535, King's Road, London SW10 0SZ.
Share Consolidation
The Board is seeking shareholder approval to consolidate the Company's ordinary share capital,
proposing that every ten existing ordinary shares of 1 penny each be consolidated into one new
ordinary share of 10 pence each. Approval will be sought at the Extraordinary General Meeting, which
will be held on 24 May 2006 at Unit 1.23, Plaza 535, King's Road, London SW10 0SZ.
Outlook
The current year has started well as we expand our institutional and subscriber customer bases. At
this stage we have every confidence that 2006 will show another year of significant improvement.
Edward Forbes,
Chairman,
London
26 April, 2006
Group Profit & Loss account
For the year ended 31 December 2005
2005 2004
�000 �000
Turnover 2,420 2,430
Administrative expenses (2,186) (2,360)
------- -------
Group operating profit 234 70
Impairment in associate (150) -
Share of operating profit/(loss) in associate 6 (8)
Amortisation of goodwill (32) (29)
------- -------
Total operating profit: group and share of associate 58 33
Interest receivable and similar income 193 168
------- -------
Profit on ordinary activities before taxation 251 201
Tax on profit on ordinary activities (87) (45)
------- -------
Profit on ordinary activities after taxation 164 156
------- -------
Basic earnings per share 0.17p 0.16p
Group Statement of Total Recognised Gains and Losses
2005 2004
�000 �000
Profit for the financial year excluding share of profits/(losses) of 158 164
associate
Share of associate profit/(loss) for the year 6 (8)
------- -------
Profit for the financial year attributable to members of the parent 164 156
company
Exchange differences on retranslation of net assets of subsidiary
undertaking (28) 55
------- -------
Total recognised gains during the year 136 211
------- -------
Group Balance Sheet
at 31 December 2005
2005 2004
�000 �000
Fixed assets
Intangible assets 17 19
Tangible assets 327 345
Investments in associate 226 400
------- ------
570 764
Current assets ------- ------
Debtors 426 550
Cash at bank and in hand 3,900 3,561
------- ------
4,326 4,111
Creditors: amounts falling due within one year (550) (617)
------- ------
Net current assets 3,776 3,494
------- ------
Total assets less current liabilities 4,346 4,258
------- ------
Capital and reserves
Called up share capital 961 961
Share premium account 3,774 3,774
Merger reserve 568 568
Profit and loss account (957) (1,045)
------- ------
Equity shareholders' funds 4,346 4,258
------- ------
The financial statements were approved by the Board on 26 April 2006 and signed on its behalf
Julian Burney
Director
Company Balance Sheet
at 31 December 2005
2005 2004
�000 �000
Fixed assets
Investments 1,767 1,911
Current assets
Debtors 591 561
Cash at bank and in hand 3,792 3,466
------- ------
4,383 4,027
Creditors: amounts falling due within one year (1,284) (1,102)
------- ------
Net current assets 3,099 2,925
------- ------
Total assets less current liabilities 4,866 4,836
------- ------
Capital and reserves
Called up share capital 961 961
Share premium account 3,774 3,774
Profit and loss account 131 101
------- ------
Equity shareholders' funds 4,866 4,836
------- ------
The financial statements were approved by the Board on 26 April 2006 and signed on its behalf
Julian Burney
Director
Group Statement of Cash Flows
for the year ended 31 December 2005
2005 2004
�000 �000
Net cash inflow/( outflow) from operating activities 276 (193)
-------- --------
Returns of investments and servicing of finance
Interest and other income received 193 168
-------- --------
Coporation tax paid (68) (18)
-------- --------
Capital expenditure
Payments to acquire tangible fixed assets (14) (36)
Payments to acquire intangible fixed assets - (20)
-------- --------
Total capital expenditure (14) (56)
-------- --------
Acquisitions and disposals
Payments to acquire investments in associates - (437)
-------- --------
Equity dividends paid (48) (48)
-------- --------
Net cash inflow/(outflow)before financing 339 (584)
-------- --------
Reconciliation of net cash flow to movement in net funds
2005 2004
�000 �000
Increase/(decrease) in cash and short term deposits 339 (584)
Net funds at 1 January 3,561 4,145
-------- --------
Net funds at 31 December 3,900 3,561
-------- --------
Reconciliation of operating profit to net cash outflow from operating activities
2005 2004
�000 �000
Operating profit 234 70
Depreciation 32 36
Decrease/ (increase) in debtors 124 (250)
(Decrease) in creditors (114) (49)
-------- --------
Net cash inflow/(outflow) from operating activities 276 (193)
-------- --------
Analysis of changes in net funds
At 1 At 31
January December
2005 Cashflow 2005
�000 �000 �000
Cash at bank and in hand 111 1 112
Short-term deposits 3,450 338 3,788
-------- ------- --------
3,561 339 3,900
-------- ------- --------
Notes
1. Nature of financial information
These accounts do not constitute accounts under section 240 of the Companies Act 1985. The
results for the year ended 31 December 2004 are extracts from the Group accounts which have
been delivered to the Registrar of Companies. They carry an unqualified auditor's report and
did not contain a statement under Section 237 (2) or (3) of the Company's Act 1985. The
statutory accounts for the year ended 31 December 2005 will be finalised on the basis of the
financial information in this preliminary announcement and will be filed with the Registrar
of Companies after the Annual General Meeting.
2. Basis of preparation
The accounts are prepared under the historical cost convention and in accordance with
applicable accounting standards. The accounting policies set out in the group accounts for
the year ended 31 December 2004 have been applied for the purposes of this statement.
3. Basis of consolidation
The group financial statements consolidate the financial statements of Stockcube PLC and all
of its subsidiary undertakings for the year to 31 December 2005.
Entities other than subsidiary undertakings, in which the group has a participating interest
and over whose operating and financial policies the group exercises a significant influence
are treated as associates. In the group financial statements, associates are accounted for
using the equity method
No profit and loss account is presented for Stockcube PLC as permitted by Section 230 of the
Companies Act 1985
4. Earnings per share
The calculation of basic earnings per ordinary share is based on earnings as follows:
2005 2004
'000 '000
Profit for the year �164 �156
Weighted average number of ordinary shares outstanding 96,106 96,106
Basic earnings per share 0.17p 0.16p
There were no dilutive potential ordinary shares in 2005 (2004:nil)
5. Dividend record and payment date
The Directors have proposed the payment of a dividend. The dividend will be paid on 7 June
2006 at a price of 0.075p per share. Dividends will be paid to those shareholders on the
Register at the close of business on 12 May 2006.
Stockcube PLC
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