TIDMTRS
RNS Number : 4099I
Tarsus Group PLC
25 July 2012
25 July 2012
Tarsus Group plc
Interim results for the six months ended 30 June 2012
Group transformed and growth prospects significantly
improved
Tarsus Group plc ('Tarsus', the 'Group' or 'Company'), the
international business-to-business media group, announces its
results for the six months ended 30 June 2012.
Financial highlights
Financial highlights - six months to 30 June
--------------------------------------------------------------------
2012 2011 2010 Growth 2012/2010
%
---------------------------- ----- ----- ----- -----------------
Revenue (GBP'm) 19.2 19.2 16.9 13
---------------------------- ----- ----- ----- -----------------
Adjusted profit before tax
(GBP'm) 1.8 0.6 1.1 64
---------------------------- ----- ----- ----- -----------------
Adjusted EPS (p) 1 0.1 0.8 25
---------------------------- ----- ----- ----- -----------------
Interim dividend per share
(p) 2.2 2.1 2 10
---------------------------- ----- ----- ----- -----------------
-- Like-for-like revenue up 14% on 2011 as adjusted for biennials
-- Interim dividend up 5% to 2.2p (2011: 2.1p)
-- Net debt GBP19.6 million (2011: GBP17.3 million)
Operational highlights
-- Quality portfolio in high growth markets driving strong Group performance
-- Very strong performance from Emerging Markets
o Turkey like-for-like revenues +17%
o China (Hope) revenues +39%
-- Medical division continues strong growth - revenues +16%
-- Group transformed with Project 50/13 strategy substantially implemented
o Life Media (Turkey) acquisition completed in March 2012
o Acquisition of GZ Auto (China) expected to complete in the next few months
-- Heads of terms agreed for new five year GBP45m bank facility
Outlook
-- Forward bookings currently stand at 80% of anticipated full year revenues (2011: 74%)
-- Labelexpo Americas and MEBA both tracking well ahead of previous events
-- Focus on accelerating earnings growth and increasing dividends over the medium term
Douglas Emslie, Group Managing Director, said:
"Our significant progress in the first half has been driven by
excellent performances in the US from our Medical and Off Price
products and in the Emerging Markets by very strong growth in the
Turkish and Chinese businesses.
"Turkey is now a key component in our portfolio as a result of
our acquisitions of Life Media and IFO. Our position in China will
be significantly enhanced with the addition of GZ Auto, the leading
automotive aftermarket show.
"With our 2012 forward bookings currently standing at 80% and
the strong performance in the first half, we have increased the
interim dividend by 5%.
"We are increasingly confident that our quality portfolio
addressing high growth sectors and markets in transition together
with our focus on driving visitors and growing exhibition volumes
will quicken the pace of our future earnings and dividend
growth".
For further information contact:
Tarsus Group plc
Douglas Emslie, Group Managing
Director 020 8846 2700
Dan O'Brien, Group Finance Director
College Hill
Adrian Duffield / Kay Larsen 020 7457 2020
The Company will be hosting a presentation to analysts at
12.30pm today at the offices of Investec, 2 Gresham Street, London,
EC2V 7QP. A webcast of the presentation will be available on
Tarsus's website (www.tarsus.com) from 9.30am on 26 July 2012.
Overview
The first half of 2012 has seen a further shift in the Group's
portfolio toward high-growth markets, driving strong underlying
growth across the business. The Group's existing Emerging Markets
portfolio delivered growth of more than 26%. The US division
continued to perform well, with Off Price and Medical events
growing strongly. Whilst trading is heavily weighted towards the
second half of the year, the Group's first half performance augurs
well for the full year.
The recent addition of Life Media in Turkey and GZ Auto
(awaiting various governmental approvals) in China to the Emerging
Markets portfolio adds significant scale to the Group's operations
in these high growth economies, taking Tarsus close to its 50/13
strategic objective of deriving 50% of revenues from Emerging
Markets in 2013.
Tarsus continues to evaluate selective bolt-on acquisition
opportunities that adhere to the Group's strict criteria of
geography, sector, and valuation that will help drive earnings
growth.
Financial review
Group revenue for the period was GBP19.2 million (2011: GBP19.2
million). Adjusting for businesses disposed in 2011 and biennial
shows, underlying like-for-like growth was 14%.
Adjusted profit before tax was GBP1.8 million (2011: GBP0.6
million), which reflects the strong revenue growth in the portfolio
together with the move toward higher margin markets. The Group
incurred exceptional costs of GBP0.2 million in respect of
acquisition costs that were expensed. Loss before tax was GBP0.2
million (2011: loss GBP1.5 million).
Adjusted earnings per share were 1.0p (2011: 0.1p). Basic loss
per share was 1.0p (2011: 2.3p).
An interim dividend of 2.2p per share (2011: 2.1p) has been
declared and will be paid on 18 January 2013 to Shareholders on the
Register on 7 December 2012. The Group will continue to offer a
scrip alternative.
Operating cash outflow was GBP0.8 million (2011: inflow GBP3.1
million). Net debt at 30 June 2012 was GBP19.6 million (2011:
GBP17.3 million). The operating cash performance reflects the
difference in timing between cash collections and payments for our
large biennial events.
The Group's balance sheet remains strong, with net debt at
GBP19.6 million (2011: GBP17.3 million). Tarsus has agreed heads of
terms for a new five-year GBP45 million bank facility expected to
provide the financial resources to support the growth strategy.
This facility is expected to operate under a net debt to EBITDA
covenant of 2.5 times throughout the five-year term.
On 30 March 2012 Tarsus announced the acquisition of 70% of Life
Media in Turkey for a total estimated consideration of GBP15
million payable in cash. The acquisition was partly financed by the
placing of 8,086,228 new ordinary shares which raised GBP10.6
million net of expenses. The remaining deferred acquisition costs,
payable in 2013, will be financed from existing cash and bank
facilities.
Operating review
Geographic Analysis
Emerging Markets - strong performance in China and Turkey
USA - excellent performance across the portfolio
Europe - stability in France but outlook remains cautious
US Europe Emerging Markets
----------------- ------------------- -------------------- ---------------------
GBP'm 2012 2011 2010 2012 2011 2010 2012 2011 2010
----------------- ----- ----- ----- ------ ----- ----- ------ ------ -----
Revenue 7.8 6.5 6.2 4.1 7.1 7.4 7.3 5.7 3.3
----------------- ----- ----- ----- ------ ----- ----- ------ ------ -----
Adjusted Profit
before tax 2.4 2.0 1.9 (0.5) 0.1 0.4 1.5 0.5 0.1
----------------- ----- ----- ----- ------ ----- ----- ------ ------ -----
Emerging markets
The Group's Emerging Markets portfolio saw strong growth with a
notable performance in China from the Hope joint venture, with
sales up 39%. The Group's position in China will be further
strengthened with the acquisition of 50% of GZ Auto, a leading
business to business automotive aftermarket exhibition held
annually in China. The acquisition, which is subject to various
governmental approvals, is expected to complete in the next few
months.
In Dubai, Tarsus' education event GESS performed strongly with
excellent visitor attendance and revenues up 16%. The Group's
largest event in Dubai in 2012 is MEBA (Middle East Business
Aviation) and forward bookings for this show are tracking well
ahead of the previous event.
In Turkey, the second REW event held under Tarsus ownership,
achieved revenue growth of 17%. Life Media, one of the largest
independent exhibition businesses in Turkey was acquired in March
2012 and organises Turkey's two leading annual housewares and gift
events. The business is now fully integrated into the Group and
held its first event, Ideal Home, under Tarsus ownership,
performing slightly better than pre-acquisition expectations and
achieving a 62% revenue increase over its previous show.
USA
Sales in the Medical division were up 16% with education/online
products showing very strong growth. The medical event held in
Orlando in May also performed very well, with revenue up 15% on its
previous edition.
The February Off Price show in Las Vegas was another record
event, with revenues up 7% compared with the equivalent 2011 event.
Bookings for the August edition of the exhibition are also tracking
ahead of its comparable 2011 iteration.
Europe
Like-for-like French sales were up 6% in the first half,
adjusted for the disposal of Modamont in 2011, driven by good
bookings at the start of the year. However, given the current
economic uncertainty in Europe, and with the largest French
exhibitions taking place in the second half of the year, the Group
remains cautious for the full year outlook in France.
Outlook
The Group has now substantially implemented its strategy of
increasing its exposure to Emerging Markets (Project 50/13) and
remains on track to hit 50% in 2013. Tarsus remains committed to
driving earnings growth by growing its diversified portfolio
organically and through selective value enhancing acquisitions.
The Group is increasingly seeing the benefits of its strategy of
driving the focus of the portfolio toward high-growth economies.
Forward bookings are strong and currently stand at 80% of
anticipated full year revenues (2011: 74%). The key events for the
remainder of 2012, Labelexpo Americas and MEBA, are tracking well
ahead of their previous iterations.
Tarsus continues to develop its portfolio in high growth
markets, with the Labels division launching a Label Summit in
Indonesia in 2013. Forward bookings for the major 2013 events - the
Dubai Airshow and Labelexpo Europe - are strong. Tarsus' high
quality portfolio in Emerging Markets and the US underpins a
positive outlook for the Group in the medium term.
Neville Buch Douglas Emslie
25 July 2012
INDEPENDENT REVIEW REPORT TO TARSUS GROUP plc
We have been engaged by the company to review the condensed set
of financial statements in the half-yearly financial report for the
six months ended 30 June 2012 which comprises the Condensed
Consolidated Interim Income Statement, Condensed Consolidated
Interim Statement of Comprehensive Income, Condensed Consolidated
Interim Statement of Financial Position, Condensed Consolidated
Interim Statement of Changes in Equity, Condensed Consolidated
Interim Statement of Cash Flows and the related notes. We have read
the other information contained in the half-yearly financial report
and considered whether it contains any apparent misstatements or
material inconsistencies with the information in the condensed set
of financial statements.
This report is made solely to the company in accordance with the
terms of our engagement. Our review has been undertaken so that we
might state to the company those matters we are required to state
to it in this report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume responsibility
to anyone other than the company for our review work, for this
report, or for the conclusions we have reached.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and
has been approved by, the directors. The directors are responsible
for preparing the half-yearly financial report in accordance with
the Disclosure and Transparency Rules of the United Kingdom's
Financial Services Authority.
As disclosed in note 2, the annual financial statements of the
group are prepared in accordance with IFRSs as adopted by the
European Union. The condensed set of financial statements included
in this half-yearly financial report has been prepared in
accordance with International Accounting Standard 34, Interim
Financial Reporting, as adopted by the European Union.
Our responsibility
Our responsibility is to express to the company a conclusion on
the condensed set of financial statements in the half-yearly
financial report based on our review.
Scope of review
We conducted our review in accordance with International
Standard on Review Engagements (UK and Ireland) 2410, 'Review of
Interim Financial Information Performed by the Independent Auditor
of the Entity' issued by the Auditing Practices Board for use in
the United Kingdom. A review of interim financial information
consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other
review procedures. A review is substantially less in scope than an
audit conducted in accordance with International Standards on
Auditing (UK and Ireland) and consequently does not enable us to
obtain assurance that we would become aware of all significant
matters that might be identified in an audit. Accordingly, we do
not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that
causes us to believe that the condensed set of financial statements
in the half-yearly financial report for the six months ended 30
June 2012 is not prepared, in all material respects, in accordance
with International Accounting Standard 34 as adopted by the
European Union and the Disclosure and Transparency Rules of the
United Kingdom's Financial Services Authority.
PKF (UK) LLP
25 July 2012
London, UK
CONDENSED CONSOLIDATED INTERIM INCOME STATEMENT
For the six months ended 30 June
Notes 2012 2011
GBP000 GBP000
Unaudited Unaudited
Revenue 7 19,157 19,233
Operating costs (18,671) (19,694)
---------- ----------
Operating profit/(loss) 486 (461)
Finance costs (648) (1,078)
---------- ----------
Loss before taxation (162) (1,539)
Taxation (charge) / credit 8 (71) 98
---------- ----------
Loss for the financial period (233) (1,441)
========== ==========
Loss for the financial period attributable
to equity shareholders of the parent company (865) (1,771)
Profit for the financial period attributable
to non- controlling interests 632 330
---------- ----------
(233) (1,441)
========== ==========
Notes 2012 2011
Unaudited Unaudited
Loss per share (pence) 9
- basic (1.0) (2.3)
- diluted (0.9) (2.3)
CONDENSED CONSOLIDATED INTERIM STATEMENT OF COMPREHENSIVE
INCOME
For the six months ended 30 June
Notes 2012 2011
GBP000 GBP000
Unaudited Unaudited
Loss for the financial period
(233) (1,441)
Other comprehensive income:
Foreign exchange translation differences (821)
Cash flow hedges:
Losses during the period 13 (9) 237 (221)
Other comprehensive (expense) / income (830) 16
Total comprehensive expense for the period (1,063) (1,425)
========== ===============
Attributable to:
Equity holders of the parent company (1,818) (1,755)
Non-controlling interests 755 330
---------- ---------------
Total comprehensive expense for the period (1,063) (1,425)
========== ===============
CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL
POSITION
Notes 30 June 30 June 31 December
2012 2011 2011
GBP000 GBP000 GBP000
Unaudited Unaudited Audited
NON-CURRENT ASSETS
Property, plant and equipment 1,509 2,012 1,461
Intangible assets 10 98,873 100,424 86,229
Other investments 1 1 1
Deferred tax assets 728 989 290
101,111 103,426 87,981
CURRENT ASSETS
Trade and other receivables 19,692 14,034 16,844
Cash and cash equivalents 6,260 14,580 8,505
----------- ----------- ------------
25,952 28,614 25,349
CURRENT LIABILITIES
Trade and other payables (13,011) (19,055) (20,528)
Deferred income (24,328) (25,996) (17,824)
Other interest bearing loans
and borrowings (1,250) (1,875) (2,250)
Liabilities for current tax (1,832) (4,719) (2,579)
----------- ----------- ------------
(40,421) (51,645) (43,181)
----------- ----------- ------------
NET CURRENT LIABILITIES (14,469) (23,031) (17,832)
----------- ----------- ------------
TOTAL ASSETS LESS CURRENT LIABILITIES 86,642 80,395 70,149
NON-CURRENT LIABILITIES
Other payables (13,688) (4,099) (4,393)
Deferred tax liability (4,600) (3,774) (3,730)
Other interest bearing loans
and borrowings (24,283) (28,807) (19,620)
----------- ----------- ------------
(42,571) (36, 680) (27,743)
----------- ----------- ------------
NET ASSETS 44,071 43,715 42,406
=========== =========== ============
EQUITY
Share capital 4,756 4,342 4,342
Share premium account 37,219 26,723 26,884
Other reserves (6,055) (5,208) (5,103)
Retained earnings 5,857 16,802 15,371
----------- ----------- ------------
Issued capital and reserves attributable
to equity holders of the parent 41,777 42,659 41,494
NON CONTROLLING INTEREST 2,294 1,056 912
----------- ----------- ------------
TOTAL EQUITY
44,071 43,715 42,406
=========== =========== ============
CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN
EQUITY
Attributable to equity holders
of the parent
Share Share Reorganisation Capital Fair Foreign Retained Non-controlling Total
capital premium reserve redemption value exchange earnings interest
account reserve reserve reserve
Unaudited GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
Six months
ended 30 June
2012:
Recognised
foreign
exchange
gain for the
period - - - - - (944) - 123 (821)
Decrease in
Fair Value
of hedging
derivatives - - - - (9) - - - (9)
Non-controlling
interest profit
for the period - - - - - - - 632 632
Loss
attributable
to shareholders - - - - - - (865) - (865)
-------- -------- --------------- ----------- -------- ---------- --------- ---------------- --------
Total
comprehensive
result for
the period - - - - (9) (944) (865) 755 (1,063)
Scrip dividend 1 32 - - - - - - 33
New share
capital
subscribed 413 10,659 - - - - - - 11,072
Cost of shares
issued - (356) - - - - - - (356)
Share option
charge - - - - - - 162 - 162
Liability
on put option
over
non-controlling
interest - - - - - - (6,850) - (6,850)
Movement in
reserves
related
to deferred
tax - - - - - - (160) - (160)
Dividend paid - - - - - - (1,800) - (1,800)
Acquisition
of
non-controlling
interests - - - - - - - 627 627
Net change
in
shareholders'
funds 414 10,335 - - (9) (944) (9,513) 1,382 1,665
Opening equity
shareholders'
funds 4,342 26,884 6,013 (443) (295) (10,377) 15,370 912 42,406
Closing equity
shareholders'
funds 4,756 37,219 6,013 (443) (304) (11,321) 5,857 2,294 44,071
======== ======== =============== =========== ======== ========== ========= ================ ========
CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN
EQUITY
Attributable to equity holders
of the parent
Share Share Reorganisation Capital Fair Foreign Retained Non-controlling Total
capital premium reserve redemption value exchange earnings interest
account reserve reserve reserve
Unaudited GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
Six months
ended 30 June
2011:
Recognised
foreign
exchange
gain for the
period - - - - - 237 - - 237
Decrease in
Fair Value
of hedging
derivatives - - - - (221) - - - (221)
Non-controlling -
interest profit
for the period - - - - - - - 330 330
Loss
attributable
to shareholders - - - - - - (1,771) - (1,771)
-------- -------- --------------- ----------- -------- ---------- --------- ---------------- --------
Total
comprehensive
result for
the period - - - - (221) 237 (1,771) 330 (1,425)
Scrip dividend 1 12 - - - - - - 13
New share
capital
subscribed 584 15,711 - - - - - - 16,295
Cost of shares
issued - (1,133) - - - - - - (1,133)
Share option
charge - - - - - - 105 - 105
Movement in
reserves
relating
to deferred
tax - - - - - - (90) (90)
Dividend paid - - - - - - (1,479) - (1,479)
Acquisition
of
non-controlling
interests - - - - - - - 547 547
Net change
in
shareholders'
funds 585 14,590 - - (221) 237 (3,235) 877 12,833
Restated Opening
equity
shareholders'
funds 3,757 12,133 6,013 (443) 14 (10,808) 20,037 179 30,882
-------- -------- --------------- ----------- -------- ---------- --------- ---------------- --------
Closing equity
shareholders'
funds 4,342 26,723 6,013 (443) (207) (10,571) 16,802 1,056 43,715
======== ======== =============== =========== ======== ========== ========= ================ ========
CONDENSED CONSOLIDATED INTERIM STATEMENT OF CASH FLOWS
For the six months ended 30 June
2012 2011
GBP000 GBP000
Unaudited Unaudited
Cash flows from operating activities
Loss for the period (233) (1,441)
Adjustments for:
Depreciation 278 249
Amortisation 1,579 1,505
Profit on disposal of tangible assets (57) -
Share option charge 162 105
Taxation charge / (credit) 71 (98)
Net interest 648 1,078
---------- ----------
Operating cashflow before changes in working
capital and provisions 2,448 1,398
Increase in trade and other receivables (2,901) (970)
(Decrease) / increase in current trade and
other payables (394) 2,689
Cash generated from operations (847) 3,117
Interest paid (862) (1,303)
Income taxes paid (987) (394)
---------- ----------
Net cash (outflow)/inflow from operating activities (2,696) 1,420
---------- ----------
Cash flows from investing activities
Acquisition of property, plant and equipment (129) (280)
Proceeds from sale of tangible fixed assets 44 -
Acquisition of intangible assets (445) (109)
Acquisition of subsidiary - cash paid (10,461) (3,041)
Acquisition of subsidiary - cash acquired 1,202 652
Deferred and contingent consideration paid (2,032) (1,094)
---------- ----------
Net cash (outflow) from investing activities (11,821) (3,872)
---------- ----------
Cash flows from financing activities
Drawdown / (repayments) of borrowings 3,483 (7,956)
Proceeds from the issue of share capital 10,916 16,270
Cost of share issue (356) (628)
Dividends paid to shareholders of parent company (1,767) (1,467)
Net cash inflow from financing activities 12,276 6,219
---------- ----------
Net (decrease)/increase in cash and cash equivalents (2,241) 3,767
Opening cash and cash equivalents 8,505 10,968
Effect of exchange rate fluctuations on cash
held (4) (155)
Closing cash and cash equivalents 6,260 14,580
---------- ----------
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL
STATEMENTS
1. REPORTING ENTITY
Tarsus Group plc (the "Company") is a company incorporated in
Jersey and resident in Ireland. The condensed consolidated interim
financial statements of the Company as at and for the six months
ended 30 June 2012 comprise the Company and its subsidiaries
(together referred to as the "Group") and the Group's interest in
jointly controlled entities.
The consolidated financial statements of the Group as at and for
the year ended 31 December 2011 are available upon request from the
Company Secretary at 17 Upper Pembroke Street, Dublin 2,
Ireland.
2. STATEMENT OF COMPLIANCE
These condensed consolidated interim financial statements have
been prepared in accordance with International Financial Reporting
Standard (IFRS) IAS 34 Interim Financial Reporting. They do not
constitute the Group's statutory accounts.
The interim financial statements should be read in conjunction
with the consolidated financial statements of the Group as at and
for the year ended 31 December 2011 which were prepared under
International Financial Reporting Standards, as adopted by the
European Union, and have been reported on by the Company's
auditors. The auditors' report was unqualified.
The interim financial statements were approved by a duly
appointed and authorised committee of the Board of Directors on 25
July 2012. The interim financial statements are unaudited but have
been reviewed by the auditors as set out in their report.
3. SIGNIFICANT ACCOUNTING POLICIES
The accounting policies applied by the Group in these condensed
consolidated interim financial statements are the same as those
applied by the Group in its consolidated financial statements as at
and for the year ended 31 December 2011, with the addition of the
following:
Put option liabilities over non-controlling interest
Put options over shares in subsidiaries held by non-controlling
interests are recognised initially at fair value through equity
when granted. They are subsequently re-measured at fair value at
each reporting period with the change in fair value recorded in the
Income Statement as other finance expenses and income.
4. ESTIMATES
The preparation of consolidated interim financial statements
requires management to make judgments, estimates and assumptions
that affect the application of accounting policies and the reported
amounts of assets and liabilities, income and expense. Actual
results may differ from these estimates.
In preparing these condensed consolidated interim financial
statements, the significant judgements made by management in
applying the Group's accounting policies and the key sources of
estimation uncertainty were the same as those that applied to the
consolidated financial statements as at and for the year ended 31
December 2011, with the addition of the following:
Put option liability over non-controlling interest
The calculation of the fair value of the put option over the
non-controlling interest in the LifeMedia business in Turkey is
based on the contractual agreement and requires the application of
key assumptions around both the future performance of this business
and the appropriate discount rate to use in Turkey. Refer to note
11 for further details of the put option liability.
5. FINANCIAL RISK MANAGEMENT
The Group's financial risk management objectives and policies
are consistent with those disclosed in the consolidated financial
statements as at and for the year ended 31 December 2011.
6. PROFIT AND LOSS ANALYSIS
The following analysis illustrates the performance of the
Group's activities, and reconciles the Group's profit, as shown in
the condensed consolidated interim income statement, to adjusted
profits. Adjusted profit is presented to provide a better
indication of overall financial performance and to reflect how the
business is managed and measured on a day-to-day basis. The
adjusted profit excludes share option charges, amortisation of
intangible assets and unwinding of discount charges.
Six months Six months
to 30 June to 30 June
2012 2011
GBP000 GBP000
Unaudited Unaudited
Loss for the financial period after
taxation (233) (1,441)
Add back:
Taxation charge / (credit) 71 (98)
------------ ------------
(162) (1,539)
Add back:
Exceptional costs 193 419
Charge for share options 162 105
Amortisation charge 1,579 1,505
Unwinding of discount - Contingent
consideration 105 116
Profit on disposal of tangible assets (57) -
Fair value adjustment - contingent
consideration (68) -
------------ ------------
Adjusted profit before tax 1,752 606
------------ ------------
In 2012, the Group incurred exceptional one-off costs of GBP0.2
million (GBP0.4 million) resulting from acquisition costs expensed
following the adoption of IFRS 3 (revised) - Business
combinations.
7. SEGMENTAL ANALYSIS
As at 30 June 2012, the Group is organised into three main
operating segments - Europe, USA and Emerging Markets. These
segments are the basis on which the Group reports its segment
information for management purposes.
The main activities of all segments are the production of
exhibitions, conferences, magazines, directories and online
media.
The following table sets out the revenue and profit information
for the Group's operating segments:
Six months ended 30 June 2012
Unaudited
Europe Emerging Central Group
USA Markets costs
GBP000 GBP000 GBP000 GBP000 GBP000
Revenue 4,111 7,751 7,295 - 19,157
------- ------- --------- -------- -------
Profit/ (loss) from operating
activities (470) 2,368 1,467 (2,879) 486
Financing costs - - - (648) (648)
Profit/ (loss) before tax (470) 2,368 1,467 (3,527) (162)
Exceptional costs 193 193
Amortisation of intangible
assets - - - 1,579 1,579
Cost of share options 162 162
Unwinding of discount -
Contingent consideration - - - 105 105
Fair value adjustment -
Contingent consideration - - - (68) (68)
Profit on disposal of tangible
assets - - - (57) (57)
------- ------- --------- --------
Adjusted profit before
tax* (470) 2,368 1,467 (1,613) 1,752
======= ======= ========= ======== =======
Six months ended 30 June 2011
Unaudited
Europe Emerging Central Group
USA Markets costs
GBP000 GBP000 GBP000 GBP000 GBP000
Revenue 7,124 6,451 5,658 - 19,233
------- ------- --------- -------- --------
Profit/ (loss) from operating
activities 107 1,967 511 (3,046) (461)
Financing costs - - - (1,078) (1,078)
--------
Profit/ (loss) before tax 107 1,967 511 (4,124) (1,539)
Exceptional costs - - - 419 419
Amortisation of intangible
assets - - - 1,505 1,505
Cost of share options - - - 105 105
Unwinding of discount -
Contingent consideration - - - 116 116
------- ------- --------- -------- --------
Adjusted profit before
tax* 107 1,967 511 (1,979) 606
======= ======= ========= ======== ========
* Adjusted profit before tax represents Group profit before tax
excluding exceptional costs, share option charges, amortisation of
intangible assets, unwinding of discount charges, fair value
adjustments on contingent consideration. This is the same measure
as given in note 6.
7. SEGMENTAL ANALYSIS
Non-current assets within Emerging Markets have significantly
increased due to the acquisition of Life Media on 30 March 2012.
Non-current assets in Europe have decreased due to the impairment
of goodwill in France and the disposal of the Group's 51%
shareholding in Modamont SAS in the financial year ended 31
December 2011. The segmental analysis of non-current assets
excluding deferred tax, is as follows:
Non-current assets
Unaudited
Europe Emerging Group
GBP000 USA Markets GBP000
GBP000 GBP000
As at 30 June 2012 19,999 39,297 41,087 100,383
======== ======== ========= ===============
Unaudited
Europe Emerging Group
GBP000 USA Markets GBP000
GBP000 GBP000
As at 30 June 2011 34,209 39,918 28,310 102,437
======== ======== ========= ===============
Audited
Europe Emerging Group
GBP000 USA Markets GBP000
GBP000 GBP000
As at 31 December 2011 20,745 40,357 26,589 87,691
======== ======== ========= =============
8. INCOME TAX EXPENSE
The taxation charge for the six months ended 30 June 2012 is
based upon the estimated effective tax rate of 15% on adjusted
profit before tax (2011: 17%) for the year ending 31 December
2012.
9. EARNINGS PER SHARE
Six months Six months
to 30 June to 30 June
2012 2011
Unaudited Unaudited
Basic loss per share (pence) (1.0) (2.3)
Diluted loss per share (pence) (0.9) (2.3)
Adjusted earnings per share (pence) 1.0 0.1
Adjusted diluted earnings per share (pence) 0.9 0.1
Basic earnings per share
Basic earnings per share has been calculated on loss after tax
attributable to ordinary shareholders for the six months of
GBP865,000 (June 2011: Loss of GBP1,771,000) and 90,127,025 (June
2011: 75,912,421) ordinary shares, being the weighted average
number of shares in issue during the period.
Diluted earnings per share
Diluted earnings per share has been calculated on the loss after
tax attributable to ordinary shareholders for the six months of
GBP865,000 (June 2011: Loss of GBP1,771,000) and 91,475,798 (June
2011: 77,217,386) ordinary shares, being the weighted average
number of shares adjusted for options in issue during the
period.
Adjusted earnings per share
The adjusted earnings per share has been calculated using profit
after tax attributable to equity shareholders, adjusted for
exceptional costs, share option charges, amortisation charges, and
loss/profit on disposal of tangible and intangible assets, of
GBP858,000 (June 2011: Profit of GBP79,000) and 90,127,025 (June
2011: 75,912,421) ordinary shares, being the weighted average
number of shares in issue during the period.
Adjusted diluted earnings per share
Adjusted diluted earnings per share is calculated using profit
after tax attributable to equity shareholders, adjusted for
exceptional costs, share option charges, amortisation charges, and
loss/profit on disposal of intangible assets, of GBP858,000 (June
2011: Profit of GBP79,000) and 91,475,798 (June 2011: 77,217,386)
ordinary shares, being the diluted weighted average number of
shares adjusted for options in issue during the period.
Weighted average number of ordinary shares (diluted):
Six months Six months
to 30 June to 30 June
2012 2011
Unaudited Unaudited
Weighted average number of ordinary shares 90,127,025 75,912,421
Effect of share options 1,348,773 1,304,965
------------ ------------
Weighted average number of ordinary shares
(diluted) 91,475,798 77,217,386
============ ============
10. INTANGIBLE FIXED ASSETS
Goodwill Trademarks Total
and Lists
GBP000 GBP000 GBP000
Unaudited Unaudited Unaudited
Cost:
At 1 January 2012 78,336 32,477 110,813
Additions through business acquisitions 12,698 1,949 14,647
Additions - 445 445
Foreign exchange adjustments (1,292) (535) (1,827)
At 30 June 2012 89,742 34,336 124,078
========== =========== ==========
Amortisation:
At 1 January 2012 8,458 16,126 24,584
Amortisation charge - 1,579 1,579
Foreign exchange adjustments (617) (341) (958)
---------- ----------- ----------
At 30 June 2012 7,841 17,364 25,205
========== =========== ==========
Net book values:
---------- ----------- ----------
At 30 June 2012 81,901 16,972 98,873
========== =========== ==========
At 31 December 2011 69,561 16,668 86,229
========== =========== ==========
At 30 June 2011 80,964 19,460 100,424
======= ======= ========
11. ACQUISITIONS
The Group completed one acquisition during the first half of
2012, in line with the Group's "Project 50/13" strategy of
expansion into Emerging Markets and specifically the fast-growing
Turkish economy.
Effective date acquired Name Type of business Percentage
------------------------- ------------------------- ------------------ -----------
LifeMedia Fuarcilik A.S Exhibition
30 March 2012 ('Life Media') business 70%
------------------------- ------------------------- ------------------ -----------
The following table sets out the book values of the identifiable
assets and liabilities acquired and their fair value to the Group,
in respect of the acquisition made during 2012:
LIFE
Carrying value Adjustments Fair value
GBP000 GBP000 GBP000
Property, plant and equipment 176 176
Other intangibles and acquisitions - 1,949 1,949
Trade and other debtors 1,743 1,743
Cash and cash equivalents 1,202 1,202
Trade and other payables (2,705) (2,705)
Deferred tax asset 115 115
Deferred tax liability - (390) (390)
_______ ________ ________
531 1,559 2,090
Non-controlling interest (30%) (627))
Net assets acquired 1,463
Goodwill arising on acquisition 12,698
Consideration paid and costs incurred:
Satisfied in cash 10,461
Contingent consideration (less
than 1 year) 3,700
Total consideration and costs incurred 14,161
Consideration paid in cash 10,461
Cash acquired (1,202)
Total net cash outflow 9,259
---------------------------------------- --------------- ------------ -----------
The values used in accounting for the identifiable assets and
liabilities and related contingent consideration of this
acquisition are estimates and are therefore provisional in nature
at the balance sheet date, due to the proximity of the date of
acquisition to the period end. If necessary, adjustments will be
made to these carrying values and the related goodwill, within 12
months of the acquisition date. The non-controlling interest is
measured as their proportionate share of the fair value of the net
assets.
Contingent consideration relates to payments to vendors, payable
after completion, that are dependent on the outcome of future
events. This contingent consideration is dependent on the future
financial performances of the various exhibitions, conferences and
publications acquired during 2012.
Tarsus and the vendor hold put and call options over the
remaining 30% of the shares of the business, exercisable from 2015
and enforceable by either party from 2016 to 2018, with
consideration payable based on a multiple of EBIT in the relevant
year. The group has recognised a liability for this through equity
in accordance with IAS 32.
From the date of acquisition to 30 June 2012, the acquisition
has contributed GBP1.6 million of revenue to the Group.
Goodwill of GBP12.7 million, recognised on this acquisition,
relates to certain assets that cannot be separated and reliably
measured. These items include sector knowledge, customer loyalty
and the anticipated future profitability that the Group can bring
to the business acquired.
The Group incurred transaction costs of GBP0.2m in respect of
the acquisition.
12. DIVIDENDS
The following dividends were paid and proposed by the Group:
For the six months ended 30 June
2012 2011
GBP000 GBP000
Unaudited Unaudited
Dividend paid in cash or scrip
2011 interim dividend (2.1p per share) 1,800 1,479
========== ==========
Dividend paid and proposed post this period
2011 / 2010 final dividend paid (4.0p /
4.0p per share) 3,945 2,963
Dividend proposed in the period (2.2p /
2.1p per share) 2,093 1,823
========== ==========
13. FOREIGN EXCHANGE TRANSLATION DIFFERENCES
Other Comprehensive Income includes foreign exchange translation
losses of GBP0.8 million (2011: gain of GBP0.2
million) relating to the retranslation of foreign currency
denominated net assets, including goodwill.
14. RELATED PARTIES
As at 30 June 2012, directors of the company controlled 10.7%
(31 December 2011: 11.7%) of the voting shares of the company.
Executive officers also participate in the Group's share option
programme and share acquisition plan.
15. ISSUE OF SHARE CAPITAL
On 30 March 2012, the Group announced the successful completion
of the placing of 8,086,228 new ordinary shares raising GBP10.6
million net of expenses.
Responsibility Statement of the Directors in respect of the
half-yearly financial report
We confirm that to the best of our knowledge:
-- the condensed set of financial statements, which has been
prepared in accordance with the applicable set of accounting
standards, gives a true and fair view of the assets, liabilities,
financial position and profit or loss of the Group;
-- the interim management report includes a fair review of the information required by:
(a) DTR 4.2.7R of the Disclosure and Transparency Rules, being
an indication of important events that have occurred during the
first six months of the financial year and their impact on the
condensed set of financial statements; and a description of the
principal risks and uncertainties for the remaining six months of
the year; and
(b) DTR 4.2.8R of the Disclosure and Transparency Rules, being
related party transactions that have taken place in the first six
months of the current financial year and that have materially
affected the financial position or performance of the entity during
that period; and any changes in the related party transactions
described in the last annual report that could do so.
Principal risks and uncertainties
The Board consider the principal risks and uncertainties
relating to the Group for the next six months to be the same as
detailed in our last Annual Report and Accounts to 31 December 2011
and include:
-- Economic and financial uncertainty
-- Events and exhibitions may be adversely affected by incidents which can curtail travel
-- Expansion into new geographic regions subjects the group to new operating risks
-- Fluctuations in exchange rates may affect the reported results
-- The ability to implement and execute strategic plans depends
on the ability to attract and retain key management
Full details of the risks and uncertainties are detailed in the
Directors' Report of the 2011 accounts.
Douglas Emslie Dan O'Brien
Group Managing Director Group Finance Director
25 July 2012
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR BKQDKABKDDOB
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