TIDMTVCH
RNS Number : 9100G
TVC Holdings PLC
13 May 2014
TVC Holdings plc
Preliminary financial results for the year ended 31 March
2014
TVC Holdings plc ("TVC" or the "Company"), the investment
holding company, today (Tuesday, 13 May 2014) announces its
Preliminary Financial Results for the year ended 31 March 2014.
Key Performance Highlights - Year to 31 March 2014:
-- Profit before tax for the year of EUR33.4 million (2013: EUR6.6 million), driven by realised gains on disposal of
investments and an increase in value of the remaining investment portfolio.
-- Subscribed EUR15.0 million for new shares in the IPO of Dalata Hotel Group plc in March 2014 and subsequently
disposed of TVC's entire Dalata shareholding for a total consideration of EUR30.4 million, realising a profit on
disposal of EUR13.4 million.
-- Disposed of 7.6 million shares in UTV Media plc in February 2014 for a total consideration of EUR22.1 million
(GBP18.2 million) realising a profit on disposal of EUR8.2 million. Including dividends received to date, this
sale enabled TVC to recover the full cost of its investment in UTV. TVC's remaining 10.05% shareholding of
9,640,262 shares in UTV was valued at EUR27.5 million at 31 March 2014.
-- Sale of investment in Shenick Network Systems Limited in February 2014 realising a profit on disposal of EUR3.8
million. The total cash proceeds payable to TVC, including escrow, amount to US$8.6 million (EUR6.4 million),
representing a return of 2.4 times the valuation of its investment.
-- Special dividend of EUR45.3 million representing EUR0.495 per share, approved at AGM in June 2013, paid to
shareholders in September 2013.
-- In August 2013, repurchased 9.6 million shares at a price equivalent to EUR0.445 per share (adjusting for payment
of the special dividend). TVC's closing share price on 31 March 2014 was EUR0.91.
-- Increase of 55% in net asset value per share over the year to EUR1.10 at 31 March 2014 (adjusting for payment of
the special dividend).
-- Net assets at 31 March 2014 of EUR101.0 million including cash at bank of EUR67.3 million, quoted equity
investments of EUR27.5 million and unquoted investments of EUR5.6 million. TVC has no debt.
Significant Return of Capital and Cancellation of TVC's Listings
on AIM and ESM
-- Detailed review of TVC's strategic options completed, following the Group's very strong 2014 financial
performance and in the light of the current equity funding environment.
-- Proposed capital distribution to shareholders in July 2014 of cash and UTV shares valued at circa EUR91 million
or EUR0.95 per ordinary share, which is 90% of TVC's net assets based on valuations at 31 March 2014.
-- Intention to cancel TVC's listings on AIM and ESM and significantly reduce group overheads.
-- Arrangements, including appropriate board and corporate governance, to be put in place to manage the realisation
of TVC's remaining assets and liabilities in an orderly way, which is expected to take a number of years, in
order to maximise value for shareholders.
Commenting on the year-end Financial Results, TVC Holdings'
Executive Chairman, Shane Reihill, said:
"We are pleased to report a year of very strong performance at
TVC with a profit for the year in excess of EUR33 million. Having
completed a detailed review of TVC's strategic options, in the
light of both the continuing lack of suitable investment
opportunities and the current equity funding environment, the Board
of TVCproposes to make a large capital distribution to shareholders
and, over a number of years, to carry out an orderly realisation of
TVC's remaining assets to maximise value. We believe that this
strategy is in the best interests of all our shareholders."
For further information please contact:
TVC Holdings plc
Shane Reihill, Executive Chairman
John Tracey, Chief Executive Officer
Tel: +353-1-2057700
Murray Consultants
Pauline McAlester
Tel: +353-1-4980300
Davy
John Frain
Tel: +353-1-6796363
Executive Chairman's Statement
Performance for year and overview of investment portfolio
In the year ended 31 March 2014, the Group recorded a profit
after tax of EUR33.4 million, which was a very strong performance.
The profit for the year included realised gains of EUR25.4 million
arising on the disposal of our investments in Dalata Hotel Group
and Shenick Network Systems, together with the partial realisation
of our investment in UTV Media plc. In addition, an unrealised gain
of EUR9.9 million arose on the Group's remaining 10.0% shareholding
in UTV.
The movement in the NAV per share during the year ended 31 March
2014 was as follows:
Cent per
EUR'000 EUR'000 share
------------------------------------------- -------- --------- ---------
Net asset value at 31 March 2013 121,900 120.6
Share buy backs (9,121) 2.6
Special dividend (45,307) (49.5)
Realised gains on disposal of investments
* UTV Media plc 8,187
* Dalata Hotel Group p.l.c. 13,394
* Unquoted investments 3,867 25,448 27.8
--------
Unrealised gains on quoted investment
in UTV Media plc 9,858 10.8
Net costs (excl. share based payment
expenses) (1,738) (1.9)
Net asset value at 31 March 2014 101,040 110.4
------------------------------------------- -------- --------- ---------
The Company's net assets per share of EUR1.10 at 31 March 2014
increased by 55% over the year from 31 March 2013 (adjusting for
the payment of the special dividend).
As at 31 March 2014, TVC's investment portfolio comprised of the
following:
%
Value % Investments
EUR'000 Investments + Cash
---------------------- --------- ------------- -------------
UTV Media plc 27,529 83% 27%
Unquoted Investments 5,623 17% 6%
Total Investments 33,152 100% 33%
Cash 67,269 67%
Total Investments
+ Cash 100,421 100%
---------------------- --------- ------------- -------------
As at the reporting date, TVC had cash of EUR67.3 million and no
debt.
Significant return of capital and cancellation of TVC's listings
on AIM and ESM
TVC's Board and management have carried out a detailed review of
the Company's strategic options. A number of factors were
considered including:
-- the Group's strong cash position following the significant value realised on the disposal of investments during
the year to March 2014; and
-- the very substantial amount of Irish and international funding seeking investment opportunities similar to those
sought by TVC.
Following this review and after careful consideration and
consultation with its advisers, the Board unanimously determined
that it would be in the best interests of the Company and its
shareholders to make a large capital distribution to shareholders
and that this would be best achieved through an issue of redeemable
shares. Under this transaction, subject to the passing of all
resolutions to be proposed at an EGM to be held in June 2014,
shareholders will receive a bonus issue of redeemable shares with
the intention that the Company will elect to redeem the shares
shortly thereafter. Accordingly, in July 2014, it is expected that
shareholders will receive cash and UTV shares with a total value of
EUR91 million, taking into account the valuation of UTV of EUR27.5
million at 31 March 2014.
Subject to shareholder approval, the Company also intends
to:
-- cancel its AIM and ESM admissions following the conclusion of the redeemable share transaction due to the costs
involved in maintaining the listings and the much reduced scope of the Group's business activities going forward;
-- significantly reduce overhead costs including making all of TVC's executives and staff redundant; and
-- make arrangements to manage the realisation of TVC's remaining assets and liabilities in an orderly manner over a
number of years.
Appropriate board and corporate governance arrangements will be
put in place post de-listing and, when all remaining assets have
been realised, the Company will distribute the remaining capital to
shareholders.
The redemption amount payable in July 2014, based on the
valuation of UTV at 31 March 2014, is expected to be EUR0.95 per
ordinary share on a fully diluted basis, which represents
approximately 90% of TVC's fully diluted NAV per ordinary share as
at 31 March 2014. TVC's pro-forma net assets as at 31 March 2014
adjusting for the redemption, executive and staff severance
packages, future lease obligations, professional fees and projected
net operating costs for the 3-month period commencing on 1 April
2014 is approximately EUR8.2 million or EUR0.09 per ordinary
share.
A circular containing further details on the proposed redeemable
share transaction and on the other authorities to be sought from
shareholders and convening an extraordinary general meeting of the
Company, to be held on the day of the Company's next annual general
meeting in June 2014, will be posted to shareholders with the 2014
Annual Report.
Board, management and staff
I would like to thank TVC's Board, management and staff for
their commitment and significant contribution to the successful
outcome for the year.
Shane Reihill
Executive Chairman
13 May 2014
Condensed consolidated statement of financial position
as at 31 March 2014
2014 2013
Notes EUR'000 EUR'000
-------------------------------------- ------ -------- --------
Non-current assets
Investments designated as fair value
through profit or loss
Quoted equity investments 27,529 31,601
Unquoted equity investments 5,623 8,935
Loans and receivables - 2,000
-------------------------------------- ------ -------- --------
Total investment portfolio 2 33,152 42,536
Property, plant and equipment 67 99
Deferred consideration receivable 3 1,214 -
--------------------------------------- ------ -------- --------
Total non-current assets 34,433 42,635
--------------------------------------- ------ -------- --------
Current assets
Available-for-sale investments - 14,511
Other receivables 3 825 1,129
Cash and cash equivalents 67,269 65,001
--------------------------------------- ------ -------- --------
Total current assets 68,094 80,641
--------------------------------------- ------ -------- --------
Total assets 102,527 123,276
--------------------------------------- ------ -------- --------
Current liabilities
Trade and other payables (1,478) (1,366)
Current taxation payable (9) (10)
--------------------------------------- ------
Total current liabilities (1,487) (1,376)
--------------------------------------- ------ -------- --------
Net assets 101,040 121,900
--------------------------------------- ------ -------- --------
Equity
Shareholders' capital 1,011 1,011
Share option reserve 363 175
Reserve for treasury shares (9,121) -
Retained earnings 108,787 120,714
--------------------------------------- ------ -------- --------
Total equity 101,040 121,900
--------------------------------------- ------ -------- --------
Condensed consolidated income statement
for the year ended 31 March 2014
2014 2013
Notes EUR'000 EUR'000
--------------------------------------- ------ ----------- ----------
Realised profits over value on the
disposal of investments 5 25,448 3,909
Unrealised profits on the revaluation
of investments 9,858 3,917
--------------------------------------- ------ ----------- ----------
35,306 7,826
Portfolio income
Dividends 1,406 1,367
Fees receivable 95 95
--------------------------------------- ------ ----------- ----------
Gross portfolio return 36,807 9,288
Operating expenses (2,777) (2,731)
--------------------------------------- ------ ----------- ----------
Net portfolio return 34,030 6,557
Finance income 221 332
Exchange movements (871) (273)
--------------------------------------- ------ ----------- ----------
Profit before tax 33,380 6,616
Income tax - -
--------------------------------------- ------ ----------- ----------
Profit for the financial year 33,380 6,616
--------------------------------------- ------ ----------- ----------
Earnings per share
Basic EPS (cent) 6 35.2 6.5
Diluted EPS (cent) 6 34.6 6.5
--------------------------------------- ------ ----------- ----------
Condensed consolidated statement of comprehensive income
for the year ended 31 March 2014
2014 2013
EUR'000 EUR'000
------------------------------------ --------- ---------
Profit for the year 33,380 6,616
Other comprehensive income - -
------------------------------------ --------- ---------
Total comprehensive income for the
year 33,380 6,616
------------------------------------ --------- ---------
Condensed consolidated statement of cash flows
for the year ended 31 March 2014
2014 2013
EUR'000 EUR'000
--------------------------------------------- --------- ---------
Cash flows from operating activities
Profit for year before tax 33,380 6,616
Adjusted for:
Depreciation 38 40
Unrealised profits on the revaluation of
investments (9,858) (3,917)
Realised profits over value on the disposal
of investments (25,448) (3,909)
Exchange movements 871 273
Share-based payment expenses 188 98
Finance income (221) (332)
Purchase of investments (15,002) -
Proceeds from disposal of investments 58,005 7,577
Increase in other current assets (101) (43)
Increase in trade and other payables 111 323
Tax received/(paid) 101 (27)
Net cash inflow from operating activities 42,064 6,699
--------------------------------------------- --------- ---------
Cash flows from investing activities
Purchase of available-for-sale investments - (29,504)
Proceeds on maturity of available-for-sale
investments 14,500 28,950
Interest received 641 1,009
Purchase of property, plant and equipment (6) (14)
Net cash inflow from investing activities 15,135 441
--------------------------------------------- --------- ---------
Cash flows from financing activities
Purchase of own shares (9,121) -
Dividends paid (45,307) -
--------------------------------------------- --------- ---------
Net cash outflow from financing activities (54,428) -
--------------------------------------------- --------- ---------
Net increase in cash and cash equivalents 2,771 7,140
Opening cash and cash equivalents 65,001 58,111
Effect of exchange rate fluctuations (503) (250)
Closing cash and cash equivalents 67,269 65,001
--------------------------------------------- --------- ---------
Condensed consolidated statement of changes in shareholders'
equity
for the year ended 31 March 2014
Share Reserve
Ordinary Ordinary option for treasury Retained Total
Shares shares reserve shares earnings equity
No. EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
Balance at 1 April 2012 101,112,579 1,011 77 - 114,098 115,186
Profit for the year - - - - 6,616 6,616
Total comprehensive income
for the
year - - - - 6,616 6,616
Transactions with owners
of the Company,recognised
directly in equity
Share-based payments - - 98 - - 98
Balance at 31 March 2013 101,112,579 1,011 175 - 120,714 121,900
Profit for the year - - - - 33,380 33,380
----------- -------- -------- ------------- --------- ---------
Total comprehensive income
for the
year - - - - 33,380 33,380
----------- -------- -------- ------------- --------- ---------
Transactions with owners
of the Company,recognised
directly in equity
Purchase of own shares - - - (9,121) - (9,121)
Dividends paid to shareholders - - - - (45,307) (45,307)
Share-based payments - - 188 - - 188
----------- -------- -------- ------------- --------- ---------
Total transactions with
owners of
the Company - - 188 (9,121) (45,307) (54,240)
----------- -------- -------- ------------- --------- ---------
Balance at 31 March 2014 101,112,579 1,011 363 (9,121) 108,787 101,040
------------------------------- ----------- -------- -------- ------------- --------- ---------
Notes to the condensed consolidated preliminary financial
information
1 Basis of preparation
The condensed consolidated preliminary financial information of
the Company for the year ended 31 March 2014 comprises of the
Company and its subsidiaries (together referred to as the
"Group").
As outlined on page 2, in May 2014, following a detailed review
of the Company's strategic options, the Board unanimously resolved
to recommend to shareholders that the Company return the
significant majority of the Company's capital to shareholders by
way of a redeemable share offer. Taking into account the valuation
of the Company's investment in UTV Media plc of EUR27.5 million as
at 31 March 2014, this liquidity event would be valued at circa
EUR91 million or 90% of the net asset value at 31 March 2014.
In addition, subject to shareholder approval where required, it
is proposed to:
-- cancel the trading of the Company's ordinary shares on AIM and ESM;
-- significantly reduce operating costs including making all of TVC's executives and staff redundant; and
-- make arrangements to manage the realisation of TVC's remaining assets and liabilities in an orderly way, which is
expected to take a number of years, with a view to making a further distribution to shareholders.
The pro-forma net assets of the Group as at 31 March 2014
adjusting for the redemption, executive and staff severance
packages, the Company's expected share of future office lease and
running costs, professional fees and projected net operating costs
for the 3-month period commencing on 1 April 2014 is EUR8.2
million, mainly comprised of an unquoted investment valued at
EUR5.6m, non-current deferred consideration of EUR1.2 million and
cash and net working capital of EUR1.4 million. Sufficient cash
will be retained to meet the Group's liabilities and its
significantly reduced operating costs post the de-listing of the
Company's shares. Therefore, the Directors are satisfied that it is
appropriate to continue to prepare the financial statements on a
going concern basis.
The financial information included in this preliminary financial
results announcement, which should be read in conjunction with the
2013 Annual Report, has been prepared on a consistent basis and
using the same accounting policies as those applied in the prior
year, in accordance with International Financial Reporting
Standards (IFRSs) as adopted by the EU and effective at 31 March
2014. Full details of the Group's accounting policies will be
included in the 2014 Annual Report. None of the new IFRSs or
interpretations that are effective for the financial year ended 31
March 2014, as outlined on pages 32-33 of the 2013 Annual Report,
had an impact on the Group's reported income or net assets. The
Group will include the additional disclosures on fair value
required by IFRS 13 'Fair value measurement' in the 2014 Annual
Report.
The condensed consolidated preliminary financial information
presented herein does not constitute full statutory financial
statements of the Group within the meaning of Regulation 40 of the
European Communities (Companies: Group Accounts) Regulations, 1992.
Statutory financial statements for the year ended 31 March 2013
have been filed with the Companies Registration Office. The
auditor's report on those financial statements was unqualified. The
statutory financial statements for the year ended 31 March 2014
will be finalised on the basis of the financial information
presented by the directors in this preliminary announcement and,
together with the independent auditor's report thereon, will be
filed with the Companies Registration Office following the
Company's Annual General Meeting.
The consolidated financial information is presented in Euro,
rounded to the nearest thousand, which is the functional currency
of the parent company and its subsidiaries.
1 Basis of preparation (continued)
The preparation of the condensed consolidated preliminary
financial information requires management to make judgements,
estimates and assumptions that affect the application of policies
and reported amounts of assets and liabilities, income and
expenses. Actual results could differ materially from these
estimates. In preparing this financial information, the significant
judgements made by management in applying the Company's accounting
policies and the key sources of estimation uncertainty are the same
as those that applied to the consolidated financial statements as
at and for the year ended 31 March 2013.
2 Investment portfolio
Equity investments Loans and
receivables Total
EUR'000 EUR'000 EUR'000
------------------------------------------ --------------------- --------------- ----------
Year to 31 March 2014
At 1 April 2013 40,536 2,000 42,536
Additions 15,002 - 15,002
Reclassification 2,000 (2,000) -
Revaluation 9,288 - 9,288
Disposals (34,244) - (34,244)
Exchange movements 570 - 570
------------------------------------------ --------------------- --------------- ----------
At 31 March 2014 33,152 - 33,152
------------------------------------------ --------------------- --------------- ----------
Quoted 27,529 - 27,529
------------------------------------------ --------------------- --------------- ----------
Unquoted 5,623 - 5,623
------------------------------------------ --------------------- --------------- ----------
Year to 31 March 2013
At 1 April 2012 41,610 500 42,110
Revaluation 6,325 1,500 7,825
Disposals (7,400) - (7,400)
Exchange movements 1 - 1
------------------------------------------ --------------------- --------------- ----------
At 31 March 2013 40,536 2,000 42,536
------------------------------------------ --------------------- --------------- ----------
Quoted 31,601 - 31,601
------------------------------------------ --------------------- --------------- ----------
Unquoted 8,935 2,000 10,935
------------------------------------------ --------------------- --------------- ----------
In March 2014, one of the Company's investee companies, Dalata
Hotel Group p.l.c. ("Dalata") successfully floated on the ESM
market of the Irish Stock Exchange and the AIM market of the London
Stock Exchange. Immediately prior to the flotation, TVC exchanged
its loan notes in Dalata for ordinary shares. In addition, TVC
invested EUR15 million in Dalata as part of the IPO. The Company
subsequently disposed of its entire shareholding in Dalata
realising a gain of EUR13.4 million.
3 Other receivables
2014 2013
EUR'000 EUR'000
----------------------------------- -------- --------
Non-current
Deferred consideration receivable 1,214 -
----------------------------------- -------- --------
Current
Prepayments 84 87
Other receivables 296 957
VAT recoverable 7 85
Deferred consideration receivable 438 -
825 1,129
----------------------------------- -------- --------
Deferred consideration receivable relates to that portion of the
proceeds from investments that have been sold which is held in
escrow for an agreed period of time.
4 Segmental analysis
Segmental information is presented in respect of the Group's
investment portfolio based on whether the investee company is
quoted or unquoted. The Group has only one reportable geographical
segment as its investments are all located in the Island of
Ireland. The segmental information presented is consistent with the
Group's internal analysis of its investment portfolio.
Dalata Hotel UTV Unquoted
Group plc Media plc investments Total
Year to 31 March 2014 EUR'000 EUR'000 EUR'000 EUR'000
--------------------------------------- ------------- ----------- ------------- ---------
Gross portfolio return
Realised profits over value
on the disposal of investments 13,394 8,187 3,867 25,448
Unrealised profits on the revaluation
of investments - 9,858 - 9,858
Portfolio income 51 1,406 44 1,501
--------------------------------------- ------------- ----------- ------------- ---------
13,445 19,451 3,911 36,807
--------------------------------------- ------------- ----------- ------------- ---------
Net (investment)/divestment
Investments (15,000) - (2) (15,002)
Realisation proceeds 30,395 22,118 7,179 59,692
15,395 22,118 7,177 44,690
--------------------------------------- ------------- ----------- ------------- ---------
Statement of financial position
Value of investment portfolio
at end of year - 27,529 5,623 33,152
--------------------------------------- ------------- ----------- ------------- ---------
UTV Unquoted
Media plc investments Total
Year to 31 March 2013 EUR'000 EUR'000 EUR'000
--------------------------------------- ------------- ----------- ------------- ---------
Gross portfolio return
Realised profits over value
on the disposal of investments - 3,909 3,909
Unrealised profits on the revaluation
of investments 1,727 2,190 3,917
Portfolio income 1,367 95 1,462
--------------------------------------- ------------- ----------- ------------- ---------
3,094 6,194 9,288
--------------------------------------- ------------- ----------- ------------- ---------
Net (investment)/divestment
Realisation proceeds - 7,400 7,400
- 7,400 7,400
--------------------------------------- ------------- ----------- ------------- ---------
Statement of financial position
Value of investment portfolio
at end of year 31,601 10,935 42,536
--------------------------------------- ------------- ----------- ------------- ---------
5 Realised profits over value on the disposal of investments
Loans and
Equity receivables Total
Year to 31 March 2014 EUR'000 EUR'000 EUR'000
------------------------------------------ --------- --------------- -----------
Net proceeds 59,692 - 59,692
Valuation of disposed investments (34,244) - (34,244)
------------------------------------------ --------- --------------- -----------
Total realised profits over opening
value 25,448 - 25,448
------------------------------------------ --------- --------------- -----------
Loans and
Equity receivables Total
Year to 31 March 2013 EUR'000 EUR'000 EUR'000
------------------------------------------ --------- --------------- -----------
Net proceeds 7,400 - 7,400
Valuation of disposed investments (3,491) - (3,491)
------------------------------------------ --------- --------------- -----------
Total realised profits over opening
value 3,909 - 3,909
------------------------------------------ --------- --------------- -----------
6 Earnings per share
2014 2013
Basic earnings per share (cent) 35.2 6.5
Diluted earnings per share (cent) 34.6 6.5
Earnings (EUR'000)
Profit for the year 33,380 6,616
--------------------------------------------------- ------------- ------------
Number of shares (Number)
Weighted average number of shares in issue 101,112,579 101,112,579
Less: weighted average own shares held (6,183,573) -
--------------------------------------------------- ------------- ------------
Weighted average number of shares for calculation
of basic
earnings per share 94,929,006 101,112,579
Number of dilutive shares under options 1,657,610 1,324,156
--------------------------------------------------- ------------- ------------
Weighted average number of shares including
dilutive share options 96,586,616 102,436,735
Basic earnings per share is calculated by dividing the profit
for the year attributable to ordinary shareholders by the weighted
average number of ordinary shares during the year.
Diluted earnings per share is calculated by dividing the profit
for the year attributable to ordinary shareholders by the weighted
average number of ordinary shares adjusted for the effect of all
potentially dilutive shares and instruments, including share
options.
7 Dividends
On 25 September 2013, a special dividend of 49.5 cent per
ordinary share was paid giving rise to a total distribution of
EUR45,306,819. The special dividend was approved by shareholders at
the Annual General Meeting held on 27 June 2013.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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