SpaceandPeople PLC Trading Update and Closure of S&P+ Limited (8967C)
July 01 2016 - 2:00AM
UK Regulatory
TIDMSAL
RNS Number : 8967C
SpaceandPeople PLC
01 July 2016
SpaceandPeople plc
("SpaceandPeople" or the "Group")
Trading Update and Closure of S&P+ Limited ("S&P+")
SpaceandPeople plc (AIM:SAL) announces the following trading
update of the Group.
The Group's UK and German retail operations are performing in
line with expectations. The UK has seen an increase in venues and
we have a strong pipeline of UK venues with whom we are in varying
stages of discussion. The reinvigorated retail offer "POP Retail"
has seen excellent traction so far and we are again currently
hitting our internal budgets for this product. In addition, the MPK
(Mobile Promotions Kiosk) has achieved its 75(th) installation and
is on track to achieve the budgeted 80-100 installed units in the
UK by the end of the year.
The Group's core UK and German promotion businesses are also
trading in line with expectations and the Board is pleased with
revenues being generated under the new Network Rail and British
Land contracts.
However, S&P+ which operates a venture in a niche sector
distinct from SpaceandPeople's core businesses, has now been
significantly curtailed and has insufficient prospects in both the
short and medium term to allow it to trade profitably.
S&P+ had planned to book substantial business deals in June
which they had been working on for some time. These deals have been
both delayed and cancelled entirely by clients. This has resulted
in considerable cash flow constraints for the S&P+ business and
the Board of SpaceandPeople, which owns 51% of S&P+, does not
consider it prudent to continue funding the venture beyond that
already provided.
The closure of S&P+ will have an effect on the Group's
consolidated results for 2016. The loan of GBP425,000 that
SpaceandPeople has provided to S&P+ will be written off as will
approximately GBP50,000 of intercompany debts resulting in a
one-off loss of approximately GBP275,000. In addition to this,
S&P+ had been expected to contribute GBP180,000 of profit
before taxation ("PBT") to the consolidated SpaceandPeople group
results for 2016 which will now be a loss of approximately
GBP200,000 instead. This does not have a negative cash impact on
the Group and the core business will continue to be cash generative
going forward. The Board of SpaceandPeople expects PBT of the Group
from continuing operations after minority interests and excluding
S&P+, in 2016 will be broadly comparable with prior year.
Matthew Bending, CEO of SpaceandPeople commented: "Obviously, we
are very disappointed about this outcome and understand the impact
this will have on the employees of S&P+, however, the core UK
and German promotions and retail businesses are trading in line
with our internal expectations and we are very happy with the
development of the MPK programme, the rejuvenation of "POP Retail"
and the strong pipeline of UK venues with whom we are in discussion
about joining our service. We do not see the decision on closing
S&P+ as having any negative effect on the core business."
Ends
0845 241
SpaceandPeople Plc 8215
Matthew Bending, Gregor Dunlay
020 7894
Cantor Fitzgerald Europe 7000
David Foreman, Will Goode
(Corporate Finance)
David Banks (Sales)
About SpaceandPeople plc:
SpaceandPeople facilitates and manages promotional space for
marketing campaigns and retailing in shopping centres and other
high footfall locations, such as theme parks and railway stations.
SpaceandPeople is at the forefront of developing the concept of
space as an advertising and promotional medium. It offers consumer
brands the opportunity to promote their products through direct
engagement with consumers through a mix of experiential marketing
events and complementary above the line advertising and multimedia
campaigns. SpaceandPeople offers a comprehensive service covering
brokerage, consultancy and venue centric media buying.
SpaceandPeople is independently funded and its shares are admitted
to trading on AIM. The Company acquired Retail Profile, the RMU
specialist, in May 2010 and operates in the UK, Germany, India and
Russia.
www.spaceandpeople.com
This information is provided by RNS
The company news service from the London Stock Exchange
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July 01, 2016 02:00 ET (06:00 GMT)