TIDMAVS
RNS Number : 1939C
Avesco Group PLC
15 January 2015
15 January 2015
AVESCO GROUP plc
PRELIMINARY RESULTS FOR THE YEAR ENDED 30 SEPTEMBER 2014
Avesco Group plc ("Avesco" or the "Group") (AIM: AVS), the
international provider of services to the corporate presentation,
entertainment and broadcast markets, announces its preliminary
results for the year ended 30 September 2014.
KEY HIGHLIGHTS
-- Revenue up 2% to GBP126.4m (2013: GBP124.0m)
-- Operating profit of GBP0.9m (2013: loss of GBP8.4m)
-- Trading profit up GBP5.8m to GBP6.3m (2013: GBP0.5m)*
-- Trading EBITDA up by a third to GBP25.0m (2013: GBP18.9m)*
-- Continuing operations loss per share of 12.8p (2013: 41.2p)
-- Adjusted basic earnings per share of 23.4p (2013: loss of 1.8p)*
-- Annual dividend (excluding Return of Cash to Shareholders)
increased by 20% to 6.0p per share (2013: 5.0p)
-- Profit from discontinued operations of GBP1.2m (2013: GBP45.7m)
* As described in note 8, the Group uses certain non-GAAP
alternative measures to assess underlying operating
performance.
Richard Murray, Chairman, commented:
"With the exception of 2012 (when we had the benefit of the
London Olympics in our home territory), trading profits reached
record levels in 2013/14. This achievement was due to an
outstanding performance in CTUS, a dramatic turnaround in
profitability in Presteigne, and a reduction in losses in our
developing CT Asia Pacific unit.
During the year, each of the Group's three divisions was subject
to a restructuring, the benefits of which are already starting to
flow through to the results.
The first quarter of the current financial year has continued
the positive momentum from last year. We expect to see further
benefits flow from the cost savings generated by the Group's
restructuring programme, so that any "odd year" dip in
profitability is minimised. With the restructuring programme now
completed and substantial forward momentum in the businesses, we
are able to continue our focus on increasing profitability,
generating cash and growing dividends."
For further information please contact:
Avesco Group plc
Richard Murray, Chairman 01293 583400
John Christmas, Group Finance Director
finnCap
Julian Blunt, Corporate Finance
Victoria Bates, Corporate Broking 020 7220 0500
Results
With the exception of 2012 (when we had the benefit of the
London Olympics in our home territory), trading profits reached
record levels in 2013/14. This achievement was due to an
outstanding performance in CTUS, a dramatic turnaround in
profitability in Presteigne, and a reduction in losses in our
developing CT Asia Pacific unit.
The Key Performance Indicators used to manage the business
comprise revenue, margin, trading EBITDA, trading profit and net
debt. Margin is the percentage derived by dividing the gross profit
by the revenue. Trading EBITDA and trading profit are Alternative
Performance Measures that better reflect our underlying trading
performance by removing various non trading items from earnings
before interest, taxation, depreciation and amortisation and from
operating profit, respectively.
Non trading items include substantial restructuring costs which
were partially offset by a reduction in our estimate of tax payable
on discontinued operations. The tax payable relates to the gain
from the Group's share of the award in the litigation against the
Walt Disney Company and others ("Disney")last year.
During the 12 months ended 30 September 2014, our total revenue
grew by GBP2.4m to GBP126.4m (2013: GBP124.0m), whilst trading
profits leapt by GBP5.8m to GBP6.3m (2013: GBP0.5m), reflecting a
margin increase of 2% and a significant overhead reduction of
GBP2.2m resulting from our restructuring efforts. Major overhead
savings were derived from reductions in premises and staff numbers,
although our worldwide coverage remains very much intact. Our
average staff numbers during the year were reduced by 8% to 705
(2013: 765).
Our operating profit was GBP0.9m (2013: GBP8.4m loss) and, after
taking account of net interest costs of GBP1.3m (2013: GBP1.5m),
the result before income tax on continuing operations was a loss of
GBP0.4m (2013: GBP9.9m loss). The tax charge for the year was
GBP2.3m (2013: GBP0.7m) and the profit from discontinued
operations, representing our revised estimate of the tax due in
respect of the Disney litigation, was GBP1.2m (2013: GBP45.7m). The
basic and diluted loss per share was 7.2p (2013: earnings of
136.2p).
The major non trading items, which were removed from the
operating results this year in order to calculate the trading
profit, comprise restructuring costs and compensation for loss of
office of GBP5.7m (2013: GBP4.8m), the vast majority of which
relates to CT Germany, and credits totalling GBP0.6m in respect of
prior period provisions. The biggest component of the CT Germany
restructuring costs is a provision in respect of an onerous lease,
which runs until 2023, on our premises near Stuttgart. Last year
there were also payments to LTIP holders and bonuses in connection
with the Disney settlement of GBP3.3m and other non-recurring costs
of GBP0.7m. The total of these restructuring and other
non-recurring costs amounted to GBP5.4m (2013: GBP8.9m).
The trading profit, excluding these items, was GBP6.3m (2013:
GBP0.5m). Trading EBITDA was GBP25.0m (2013: GBP18.9m). The trading
profit less interest and current tax was GBP5.0m (2013: GBP0.5m
loss) and on this basis the adjusted basic earnings per share was
23.4p (2013: loss per share of 1.8p).
Creative Technology (CT)
Creative Technology saw revenues climb GBP4.4m to GBP96.1m
(2013: GBP91.7m) and trading profit to GBP4.4m (2013: GBP1.8m).
CTUS was again the star performer, growing revenue by 18%, having
been the main beneficiary of the Group's more targeted capital
spend. Revenue also increased in all other parts of the division
with the sole exception of Germany. The restructuring of CT Germany
during the year was necessitated by the decision of our major
German clients to move away from their previous practice of using
German based staff and equipment to service their needs worldwide.
As a result, we are now able to service these clients locally from
our network of offices around the world. Other companies in the
division benefited from this transfer of business as well as from
normal even year events, such as the Winter Olympics in Sochi, the
FIFA World Cup in Brazil and the Commonwealth Games and Ryder Cup
in Scotland, which between them generated revenue of GBP4.1m.
Despite the drop in revenue in Germany, losses in CT Germany
were reduced and, with a promising start there to the new financial
year, we are optimistic of eliminating them entirely within the
next 12 months.
Creative Technology Asia Pacific ("CTAP") had a significantly
improved performance over last year but failed to reach its break
even target. The reopening of our Singapore operation at the
beginning of the period has proved successful and, with significant
amounts of equipment moving into the region from the restructured
German business, we are hopeful that CTAP will prove to be both
profitable and a significant asset to our other larger CT
operations seeking to service their clients in the region.
Full Service
mclcreate, previously known as MCL, is now our sole full service
business. Revenue grew to GBP14.4m (2013: GBP13.4m) but trading
profit dropped to GBP0.2m (2013: GBP0.7m). This reduction reflected
slightly lower margins and increased overheads from the new
management structure put in place as mclcreate positions itself for
the next stage of its development and growth.
Broadcast Services
Our Broadcast Services division has been a major beneficiary of
the Group restructuring programme, with revenue dropping to
GBP15.8m (2013: GBP18.9m) but trading profits rising to GBP1.7m
from a trading loss of GBP2.0m in 2012/13. The decrease in revenue
is mainly driven by the closure of Presteigne's projects-based
Singapore office, as well as the closure of its mainland European
businesses. The disposal of significant amounts of projects
equipment and the slimming down of the remaining UK back office
functions ensured that the company, now rebranded as Presteigne
Broadcast Hire, quickly returned to profitability. Fountain
Studios, the other business in this division, was again home to
some of the UK's major TV shows, but a quiet summer dominated by TV
coverage of the FIFA World Cup meant that the company made only a
small profit.
Taxation
Taxation was again at a relatively significant level as high
taxable profits earned in the US cannot be offset against taxable
losses elsewhere in the world.
The income tax expense for the year was GBP2.3m (2013: GBP0.7m),
comprised of a minimal current tax credit (2013: GBP0.6m credit)
due to the utilisation of allowances around the Group, and a
deferred tax charge of GBP2.3m (2013: GBP1.3m). The deferred tax
charge has arisen primarily due to the utilisation of losses across
the Group and first year allowances in the US.
Our deferred tax asset at the year end stood at GBP3.9m (2013:
GBP5.2m). Tax losses represent GBP1.0m (2013: GBP3.3m) of this
asset, with the balance of GBP2.9m (2013: GBP1.9m) mostly resulting
from the temporary difference between the tax base and the book
value of property, plant and equipment.
Further deferred tax assets amounting to GBP4.5m at the year end
(2013: GBP6.6m) remain
unrecognised on the balance sheet.
The majority of the deferred tax liability of GBP5.3m (2013:
GBP4.2m) relates to temporary differences between the tax base and
the book value of property, plant and equipment and has primarily
arisen due to the availability of high levels of first year
allowances on equipment purchases in CTUS.
Disney, Return of Cash to Shareholders and Buy-back of Shares
from Taya
As previously announced, we completed two significant
transactions during the year, both funded by our share of the
proceeds of theDisney litigation.
The cash received in June 2013, after deductions for estimated
tax liabilities, indemnities, and related bonuses, was GBP44.5m or
$68.1m ("Net Receipt"). An amount of GBP1.10 per ordinary share,
representing 68% (GBP30.4m) of the total Net Receipt, was returned
to shareholders in cash by way of a B & C Share Scheme, and to
LTIP holders by way of a cash bonus, on 31 January 2014. The return
of cash was structured in such a way as to allow shareholders,
subject to applicable legal and regulatory restrictions, to elect
to receive their proceeds as either income or capital.
On 5 February 2014, we also completed the buy-back of 7,584,724
ordinary shares of the Company from Taya Communications Ltd
("Taya") for a total consideration of GBP9.4m plus associated fees.
Upon completion of the share buy-back, the Taya representatives on
the Board, Mr Amiram Giniger and Ms Carmit Hoomash, both
resigned.
The balance of the Disney funds received was applied to the
restructuring of the Group's businesses as outlined above and to
reduce debt.
Cash Generation and Capital Expenditure
The Group's net debt, which stood at GBP24.8m at the beginning
of 2012/13, was successfully reduced by GBP3.4m to GBP21.4m by the
end of 2013/14. The Group's cash flow was impacted in the
intervening period by the GBP44.5m Net Receipt from the Disney
litigation in 2012/13, as well as by the GBP30.5m return of cash to
shareholders, the GBP9.8m buy-back of shares from Taya and the
Group restructuring programme in 2013/14.
When the cash effect of these transactions, shareholder
dividends of GBP1.0m, and other non-recurring costs are removed,
the net cash inflow for the Group in 2013/14 was GBP1.9m (2013:
GBP0.3m). This was generated from a trading EBITDA of GBP25.0m
(2013: GBP18.9m), net investments in new equipment of GBP19.0m
(2013: GBP15.8m), 50% of which went to CT US, net outflows of
working capital and other balance sheet items of GBP2.3m (2013:
GBP1.1m), and interest and tax payments of GBP1.9m (2013:
GBP1.7m).
The return of cash to shareholders and the Taya share buyback
were mainly responsible for the net assets of the Group reducing
over the year to GBP32.1m on 30 September 2014 (2013: GBP73.2m).
This equates to a net asset value of GBP1.70 per share (2013:
GBP2.82) or GBP1.67 per share (2013: GBP2.66) on a fully diluted
basis (when the remaining 0.4m shares subject to LTIP awards are
taken into account).
In addition to the Group's cash balances of GBP9.0m, the Group
had unutilised banking and HP facilities of GBP18.2m at the year
end and remains comfortably within its finance and banking
facilities of some GBP48.6m. The main component of the Group's
facilities is a GBP20m multi currency revolving loan from HSBC,
which was renewed during the year on favourable terms and is now in
place until June 2018, with the balance comprising a combination of
overdraft and leasing lines.
Dividend
We increased our interim dividend at the half year to 1.5p per
share (2013: 1.0p) and this payment was made in October 2014. The
Board is now pleased to announce that it also proposes to increase
the final dividend to 4.5p (2013: 4.0p) per share, making a total
dividend for the year of 6.0p per share (2013: 5.0p), reflecting
our confidence in the longer term prospects for the Group.
Subject to shareholder approval, the proposed dividend is
expected to be paid on 8 April 2015 to shareholders on the register
at the close of business on 13 March 2015.
People
Whilst there will always be tough competition for our services,
we are operating in buoyant markets where the high quality and
technical expertise of our staff give us a discernible edge.
Working long and unsociable hours to deliver the highest levels of
service that our customers expect are regular occurrences. I cannot
thank them enough.
Current Trading and Outlook
The first quarter of the current financial year has continued
the positive momentum from last year. We expect to see further
benefits flow from the cost savings generated by the Group's
restructuring programme, so that any "odd year" dip in
profitability is minimised. With the restructuring programme now
completed and substantial forward momentum in the businesses, we
are able to continue our focus on increasing profitability,
generating cash and growing dividends.
Richard Murray
15 January 2015
Avesco Group plc
Consolidated Income Statement
For the year ended 30 September 2014
Year ended 30 September
2014 2013
Note GBP000s GBP000s
------------------------------------- ----- ------------ ------------
Revenue 1 126,391 124,033
Cost of sales (80,186) (80,408)
------------------------------------- ----- ------------ ------------
Gross profit 46,205 43,625
Operating expenses and income (45,721) (51,947)
Share of associate's profit/(loss) 384 (28)
------------------------------------- ----- ------------ ------------
Trading profit 6,253 511
Exceptional items (5,385) (8,861)
------------------------------------- ----- ------------ ------------
Operating profit/(loss) 1 868 (8,350)
Finance income 23 3
Finance costs (1,321) (1,532)
------------------------------------- ----- ------------ ------------
Loss before income tax (430) (9,879)
Income tax expense 3 (2,310) (744)
------------------------------------- -----
Loss from continuing operations (2,740) (10,623)
Profit on discontinued operation,
net of tax 1,192 45,729
(Loss)/profit for the financial
year (1,548) 35,106
------------------------------------- ----- ------------ ------------
Pence per Pence per
share share
(Losses)/earnings per share
attributable to the equity holders
of the company (note 4)
- basic (7.2)p 136.2p
- diluted (7.2)p 136.2p
(Losses) per share for profit
attributable to the equity holders
of the company from continuing
operations (note 4)
- basic (12.8)p (41.2)p
- diluted (12.8)p (41.2)p
Avesco Group plc
Alternative Performance Measures (non-GAAP)
For the year ended 30 September 2014
Year ended 30 September
2014 2013
GBP000s GBP000s
------------------------------------------- ------------ ------------
Operating profit/(loss) 868 (8,350)
Adjusted to exclude:
------------------------------------------- ------------ ------------
Restructuring costs and compensation
for loss of office 5,738 4,845
Payments to LTIP holders and bonuses
in connection with the Disney settlement (246) 3,298
Other non-recurring (credits)/costs (107) 718
-------------------------------------------- ------------ ------------
Exceptional items 5,385 8,861
Trading profit 6,253 511
Net finance costs (1,298) (1,529)
Trading profit/(loss) after net
finance costs 4,955 (1,018)
-------------------------------------------- ------------ ------------
Current tax credit (note 3) 35 566
Trading profit /(loss) after net
finance costs and current tax expense 4,990 (452)
-------------------------------------------- ------------ ------------
Trading EBITDA (note 2) 24,968 18,943
-------------------------------------------- ------------ ------------
Adjusted earnings/(losses) per Pence per Pence per
share (per note 4) share share
------------------------------------------- ------------ ------------
- basic 23.4p (1.8)p
- diluted 23.4p (1.8)p
Refer to note 8 for a full description of the alternative
performance measures adopted by the Group.
Consolidated Statement of Comprehensive Income
For the year ended 30 September 2014
Year ended 30 September
2014 2013
GBP000s GBP000s
-------------------------------------- ------------ ------------
(Loss)/profit for the financial
year (1,548) 35,106
Other comprehensive income:
Currency translation differences 187 72
--------------------------------------- ------------ ------------
Total comprehensive (expense)/income
for the year (1,361) 35,178
--------------------------------------- ------------ ------------
Avesco Group plc
Consolidated balance sheet
As at 30 September 2014
30 September 1 October
30 September 2013 2012
2014 Restated Restated
GBP000s GBP000s GBP000s
------------------------------------- ------------------- ------------- ----------
Assets
Non-current assets
Property, plant and equipment 57,787 56,346 62,337
Intangible assets 130 311 130
Investment in associate 327 143 271
Deferred income tax assets 3,919 5,219 6,707
Trade and other receivables 148 141 159
-------------------------------------- ------------------- ------------- ----------
62,311 62,160 69,604
Current assets
Inventories 596 829 1,243
Trade and other receivables 23,801 23,114 26,573
Current income tax assets - 13 86
Cash at bank and on hand 9,065 43,699 4,345
33,462 67,655 32,247
------------------------------------- ------------------- ------------- ----------
Total assets 95,773 129,815 101,851
-------------------------------------- ------------------- ------------- ----------
Liabilities
Non-current liabilities
Borrowings and loans 22,602 13,467 21,662
Deferred income tax liabilities 5,292 4,247 4,425
Provisions 2,477 295 432
-------------------------------------- ------------------- ------------- ----------
30,371 18,009 26,519
Current liabilities
Trade and other payables 24,543 27,241 28,540
Current income tax liabilities 384 2,879 544
Borrowings and loans 7,902 7,895 7,448
Provisions 430 592 189
-------------------------------------- ------------------- ------------- ----------
33,259 38,607 36,721
------------------------------------- ------------------- ------------- ----------
Total liabilities 63,630 56,616 63,240
-------------------------------------- ------------------- ------------- ----------
Total assets less total liabilities 32,143 73,199 38,611
-------------------------------------- ------------------- ------------- ----------
Equity
Capital and reserves attributable
to equity holders of the
company
Ordinary shares 2,095 2,649 2,599
Share premium 11,194 23,286 23,286
Capital redemption 12,646 - -
Translation reserve 232 45 (27)
Retained earnings 5,976 47,219 12,753
-------------------------------------- ------------------- ------------- ----------
Total equity 32,143 73,199 38,611
-------------------------------------- ------------------- ------------- ----------
Refer to note 8 for a description of the change in accounting
policy which has lead to the restatement of the prior year
balances.
Avesco Group plc
Consolidated Statement of Changes in Equity
For the year ended 30 September 2014
Share Share Capital
capital premium redemption Translation Retained
account account reserve reserve earnings Total
GBP000s GBP000s GBP000s GBP000s GBP000s GBP000s
------------------ ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
Balance at 1
October
2013 2,649 23,286 - 45 47,219 73,199
Loss for the
period - - - - (1,548) (1,548)
Other
comprehensive
income,
net of tax - - - 187 - 187
------------------ ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
Total
comprehensive
income/(expense)
for the period - - - 187 (1,548) (1,361)
Transactions with
owners
in their capacity
as
owners:
Issue of B and C
shares 12,092 (12,092) - - - -
Redemption of B
shares (12,092) - 12,092 - (12,092) (12,092)
Dividend on C
shares - - - - (16,455) (16,455)
Purchase of
ordinary
shares (554) - 554 - (9,769) (9,769)
External
dividends paid - - - - (1,013) (1,013)
LTIP and share
options - - - - (366) (366)
Balance at 30
September
2014 2,095 11,194 12,646 232 5,976 32,143
------------------ ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
Share Share Capital
capital premium redemption Translation Retained
account account reserve reserve earnings Total
GBP000s GBP000s GBP000s GBP000s GBP000s GBP000s
------------------ ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
Balance at 1
October
2012 2,599 23,286 - (27) 12,753 38,611
Profit for the
period - - - - 35,106 35,106
Other
comprehensive
income,
net of tax - - - 72 - 72
------------------ ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
Total
comprehensive
income
for the period - - - 72 35,106 35,178
Transactions with
owners
in their capacity
as
owners:
External
dividends paid - - - - (1,032) (1,032)
LTIP and share
options 50 - - - 392 442
Balance at 30
September
2013 2,649 23,286 - 45 47,219 73,199
------------------ ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
Avesco Group plc
Consolidated cash flow statement
For the year ended 30 September 2014
Year ended 30 September
2013
2014 Restated
GBP000s GBP000s
------------------------------ --------------- -------------------------------
Cash flows from operating
activities
Cash generated from
operations 16,415 66,916
Income tax paid (1,268) (1,157)
Net cash generated
from operating activities 15,147 65,759
------------------------------- --------------- -------------------------------
Cash flows from investing
activities
Purchases of property,
plant and equipment
and software (23,492) (16,403)
Proceeds from sale
of property, plant
and equipment 4,450 637
Dividends from associate 200 100
Net cash used in
investing activities (18,842) (15,666)
------------------------------- --------------- -------------------------------
Cash flows from financing
activities
Net interest (paid)/received (1,224) (1,604)
Proceeds from external
borrowings 23,361 13,909
Repayments of external
borrowings (13,544) (22,162)
Purchase of ordinary
shares (9,769) -
Redemption of B shares (12,092) -
Dividends paid to
Company's shareholders (17,468) (1,032)
Net cash used in
financing activities (30,736) (10,889)
------------------------------- --------------- -------------------------------
Net (decrease)/increase
in cash and cash
equivalents (34,431) 39,204
Cash, cash equivalents
and bank overdrafts
at beginning of year 43,107 4,116
Exchange gains/(losses)
on cash and bank
overdrafts 292 (213)
Cash and cash equivalents
at end of year 8,968 43,107
------------------------------- --------------- -------------------------------
Avesco Group plc
Notes to the preliminary announcement
For the year ended 30 September 2014
1. Segmental information
Management has determined the operating segments based on the
reports reviewed by the Board of Directors that are used to make
strategic decisions.
The Board of Directors categorises Group companies based on the
services they provide and as a result the business is split into
four segments. These correspond to three operating segments
(Creative Technology, Full Service and Broadcast Services) which
together provide the Group's principal activity of services to the
corporate presentation, entertainment and broadcast markets. In
addition, the Group recognises a further segment, Head Office,
which provides administrative support to the rest of the Group.
Creative Technology provides specialist AV services and
equipment to the live events, broadcast and entertainment markets.
The Full Service segment provides full technical support for
conferences, sports, music, corporate and television programmes.
Finally, the Broadcast Services segment provides broadcast
equipment, systems and services to the broadcast industry.
Following a review of the Group's continental European
businesses, the allocation of the Group's subsidiaries to operating
segments was changed to align them with the revised organisational
reporting structure. Our Spanish and Dutch Full Service businesses
have now been integrated in to the operations of Creative
Technology. Results for prior periods have been restated to
facilitate comparison.
The Board of Directors assesses performance of the operating
segments based on trading profit (see note 8). As segmental
performance does not therefore include finance costs and tax, such
items are not allocated to segments.
The segmental results for the year ended 30 September 2014 are
as follows:
Creative Full Broadcast Head
Technology Service Services Office Group
GBP000s GBP000s GBP000s GBP000s GBP000s
------------------------------- ------------ ------------------ ------------------ ------------------- ---------
Total segment revenue 96,258 14,446 16,266 - 126,970
Inter segment revenue (133) (17) (429) - (579)
-------------------
Revenue 96,125 14,429 15,837 - 126,391
------------------------------- ------------ ------------------ ------------------ ------------------- ---------
Trading EBITDA* 18,755 980 5,300 (67) 24,968
Less depreciation (13,529) (732) (3,610) (9) (17,880)
Less impairment (726) - - - (726)
Less amortisation (80) (19) (10) - (109)
------------------------------- ------------ ------------------ ------------------ ------------------- ---------
Trading profit/(loss) 4,420 229 1,680 (76) 6,253
Restructuring (costs)/credits
and compensation for
loss of office (5,247) (474) (38) 21 (5,738)
Payments to LTIP holders
and bonuses in connection
with the Disney settlement 59 16 9 162 246
Other non-recurring
credits/(costs) 426 (8) (249) (62) 107
------------------------------- ------------ ------------------ ------------------ ------------------- ---------
Operating (loss)/profit (342) (237) 1,402 45 868
Net finance costs (1,298)
Profit before income
tax (430)
Income tax expense (2,310)
------------------------------- ------------ ------------------ ------------------ -------------------
Loss for the financial
year from continuing
operations (2,740)
------------------------------- ------------ ------------------ ------------------ ------------------- ---------
*Trading EBITDA includes profit on sale of property, plant and
equipment of GBP36,000 for Creative Technology, GBP12,000 for Full
Service and GBP1,298,000 for Broadcast Services.
The segmental results for the year ended 30 September 2013 are
as follows:
Creative Full Broadcast Head
Technology Service Services Office Group
GBP000s GBP000s GBP000s GBP000s GBP000s
------------------------------------- ------------ --------- ---------- -------- ---------
Total segment revenue 91,988 13,445 19,336 - 124,769
Inter segment revenue (291) (24) (421) - (736)
--------
Revenue 91,697 13,421 18,915 - 124,033
------------------------------------- ------------ --------- ---------- -------- ---------
Trading EBITDA* 14,718 1,265 2,895 65 18,943
Less depreciation (12,837) (601) (4,875) (13) (18,326)
Less amortisation (75) (11) (20) - (106)
------------------------------------- ------------ --------- ---------- -------- ---------
Trading profit/(loss) 1,806 653 (2,000) 52 511
Restructuring costs and
compensation for loss
of office (901) (86) (3,820) (38) (4,845)
Payments to LTIP holders
and bonuses in connection
with the Disney settlement (1,485) (296) (272) (1,245) (3,298)
Other non-recurring (costs)/credits (868) - 150 - (718)
------------------------------------- ------------ --------- ---------- -------- ---------
Operating (loss)/profit (1,448) 271 (5,942) (1,231) (8,350)
Net finance costs (1,529)
Loss before income tax (9,879)
Income tax expense (744)
------------------------------------- ------------ --------- ---------- --------
Loss for the financial
year from continuing
operations (10,623)
------------------------------------- ------------ --------- ---------- -------- ---------
* Trading EBITDA includes profit on sale of property, plant and
equipment of GBP438,000 for Creative Technology, GBP18,000 for Full
Service and GBP322,000 for Broadcast Services.
Inter-segment transactions are entered into under the normal
commercial terms and conditions that would be available to
unrelated third parties.
No single customer contributed revenues of greater than 10% of
the Group's total revenue for 2014 or 2013.
The segmental assets and liabilities at 30 September 2014,
external net debt at 30 September 2014 and capital expenditure cash
flows for the year then ended are shown below.
Creative Full Broadcast Head
Technology Service Services Office Unallocated Group
GBP000s GBP000s GBP000s GBP000s GBP000s GBP000s
-------------------------- ------------ --------- ---------- -------- ------------------ --------
Total assets 63,454 4,422 23,214 764 3,919 95,773
Non-current assets 37,363 2,067 18,808 6 3,919 62,163
Total liabilities 30,899 2,112 6,134 18,809 5,676 63,630
Capital expenditure 15,939 1,037 6,237 279 - 23,492
External net debt/(cash) 3,957 (329) 1,939 15,872 - 21,439
--------------------------- ------------ --------- ---------- -------- ------------------ --------
Unallocated items relate to deferred tax and income tax.
Non-current assets above does not agree to the balance sheet as it
excludes non-current receivables.
The segmental assets and liabilities at 30 September 2013,
external net debt at 30 September 2013 and capital expenditure cash
flows for the year then ended are shown below.
Creative Full Broadcast Head
Technology Service Services Office Unallocated Group
GBP000s GBP000s GBP000s GBP000s GBP000s GBP000s
------------------------- ------------ --------- ---------- ------------------- ------------------- ---------
Total assets 62,882 5,963 31,658 24,080 5,232 129,815
Non-current assets 36,183 1,783 18,821 13 5,219 62,019
Total liabilities 27,832 2,136 7,392 12,130 7,126 56,616
Capital expenditure
(restated) 12,633 828 2,942 - - 16,403
External net debt/(cash) 2,549 (2,006) (3,136) (19,744) - (22,337)
-------------------------- ------------ --------- ---------- ------------------- ------------------- ---------
The Group's main business segments operate in four main
geographical areas. Details of the segmental allocation of revenue
can be found below.
2014 2013
Revenue GBP000s GBP000s
-------------------------- -------- --------
United Kingdom 48,801 39,748
Mainland Europe 14,577 23,050
United States of America 51,545 46,444
Rest of the World 11,468 14,791
126,391 124,033
-------------------------- -------- --------
2. Trading earnings before interest, taxation, depreciation and amortisation ('Trading EBITDA')
2013
2014 Restated
GBP000s GBP000s
-------------------------- -------- ----------
Trading profit 6,253 511
Depreciation 17,880 18,326
Impairment 726 -
Amortisation of software 109 106
Trading EBITDA 24,968 18,943
--------------------------- -------- ----------
Trading EBITDA is defined in note 8.
3. Income tax expense
2014 2013
GBP000s GBP000s
--------------------------------------- -------- --------
Current tax
Current tax on profits for the
year 393 (479)
Adjustments in respect of prior
years (428) (87)
---------------------------------------- -------- --------
Total current tax (35) (566)
Deferred tax
Origination and reversal of temporary
differences 2,345 1,046
Impact of change in the UK tax
rate - 264
---------------------------------------- -------- --------
Total deferred tax 2,345 1,310
Income tax charge 2,310 744
---------------------------------------- -------- --------
4. Earnings/(losses) per share
2014 2013
GBP000s GBP000s
------------------------------------------ -------- ---------
(Loss)/profit for the financial year (1,548) 35,106
Profit on discontinued operation,
net of tax (1,192) (45,729)
------------------------------------------ -------- ---------
Loss from continuing operations (2,740) (10,623)
Exceptional items 5,385 8,861
Deferred tax charge 2,345 1,310
Trading profit/(loss) after net finance
costs and current tax expense 4,990 (452)
------------------------------------------ -------- ---------
Weighted average number of shares
(net of treasury shares)
For basic earnings per share (000's) 21,361 25,781
Effect of dilutive share options (000's) 848 1,782
---------
For diluted earnings per share (000's) 22,209 27,563
------------------------------------------ -------- ---------
(Losses)/earnings per share
Basic (7.2)p 136.2p
Diluted (7.2)p 136.2p
------------------------------------------ -------- ---------
Continuing operations basic (12.8)p (41.2)p
Continuing operations diluted (12.8)p (41.2)p
------------------------------------------ -------- ---------
Adjusted basic 23.4p (1.8)p
Adjusted diluted 23.4p (1.8)p
------------------------------------------ -------- ---------
Discontinued operations basic 5.6p 177.4p
Discontinued operations diluted 5.6p 177.4p
------------------------------------------ -------- ---------
Basic earnings per share have been calculated by dividing
profit/loss for the period by the weighted average number of
ordinary shares in issue during the period.
Diluted earnings per share have been calculated by dividing
profit/loss for the period by the weighted average number of
ordinary shares in issue during the period, adjusted for any awards
under the Company's Long Term Incentive Plan ("LTIP") where
pre-specified performance conditions have been satisfied and any
required conversion of dilutive potential options.
Exceptional items consist of restructuring costs and
compensation for loss of office, payments to LTIP holders and
bonuses in connection with the Disney settlement, and other
non-recurring costs.
Adjusted earnings per share have been calculated as per note
8.
5. Dividends
An interim dividend for the year ended 30 September 2014 of 1.5p
per ordinary share amounting to a total of GBP283,000 was approved
and was paid on 1 October 2014 to shareholders on the Register at
6.00pm on 5 September 2014.
A final dividend for the year ended 30 September 2014 of 4.5p
per share has been proposed and, subject to shareholders' approval,
will be paid on 8 April 2015 to shareholders on the register at the
close of business on 13 March 2015.
A special dividend of GBP1.10 per C share was approved and was
paid on 24 January 2014 under the Return of Cash.
A final dividend for the year ended 30 September 2013 of 4.0p
per ordinary share amounting to a total of GBP754,000 was approved
and was paid on 7 April 2014 to shareholders on the register at
6.00pm on 14 March 2014.
An interim dividend for the year ended 30 September 2013 of 1.0p
per ordinary share amounting to a total of GBP259,000 was approved
and was paid on 1 October 2013 to shareholders on the Register at
6.00pm on 4 September 2013.
6. Analysis of net debt
At 1 Other Currency At 30
October Net cash non cash translation September
2013 flow changes differences 2014
GBP000s GBP000s GBP000s GBP000s GBP000s
--------------------- --------- --------- ---------------- ------------- -----------
Cash at bank and
in hand 43,699 (34,859) - 225 9,065
Bank overdrafts (592) 428 - 67 (97)
---------------------- --------- --------- ---------------- ------------- -----------
Net cash 43,107 (34,431) - 292 8,968
Bank loans due in
more than one year (7,419) (9,492) - 63 (16,848)
HP obligations due
in less than one
year (7,303) 5,613 (6,182) 67 (7,805)
HP obligations due
in more than one
year (6,048) (5,938) 6,182 50 (5,754)
Net cash/(debt) 22,337 (44,248) - 472 (21,439)
---------------------- --------- --------- ---------------- ------------- -----------
At 1 Other Currency At 30
October Net cash non cash translation September
2012 flow changes differences 2013
Group GBP000s GBP000s GBP000s GBP000s GBP000s
--------------------- --------- --------- ---------- ------------- -----------
Cash at bank and
in hand 4,345 39,572 - (218) 43,699
Bank overdrafts (229) (368) - 5 (592)
---------------------- --------- --------- ---------- ------------- -----------
Net cash 4,116 39,204 - (213) 43,107
Bank loans due in
more than one year (13,645) 6,247 - (21) (7,419)
HP obligations due
in less than one
year (7,219) 6,359 (6,377) (66) (7,303)
HP obligations due
in more than one
year (8,017) (4,353) 6,377 (55) (6,048)
Net (debt)/cash (24,765) 47,457 - (355) 22,337
---------------------- --------- --------- ---------- ------------- -----------
Other non cash changes relate to
the passage of time.
7. Status of preliminary announcement
The financial information set out in this announcement for the
year ended 30 September 2014 does not constitute the Group's
statutory accounts as defined by s435 of the Companies Act but has
been extracted from the 2014 statutory accounts on which an
unqualified audit report has been made by the auditors, and which
did not contain an emphasis of matter paragraph nor a statement
under section 498(2) or (3) of the Companies Act 2006.
Statutory Accounts for the year ended 30 September 2013 have
been delivered to the Registrar of Companies and the auditors'
report on these accounts was unqualified and did not contain a
statement under either Section 498(2) or (3) of the Companies Act
2006.
8. Basis of preparation
With the exception of the change in accounting policy noted
below, the preliminary results for the year ended 30 September 2014
have been prepared in accordance with the accounting policies set
out in the annual report and accounts for the year ended 30
September 2013.
Change in accounting policy
In the current period the Group has adopted the amendment to IAS
16 Property, Plant and Equipment which forms part of the
Improvements to International Financial Reporting Standards 2009 to
2011 Cycle. This amendment clarifies that major spare parts and
servicing equipment that meet the definitions of property, plant
and equipment should not be classified as inventory. As a result of
this amendment the Group has revised its accounting policy for the
classification of cable. The balance of GBP524,000 as at 30
September 2013 was previously classified as inventory, and in light
of this amendment has been reclassified as property, plant and
equipment.
There has been no impact on the equity or results of the Group
as a result of this change in policy. The consolidated balance
sheet and cash flow statement have been restated as a result of
this change in policy. A balance sheet for the year ended 30
September 2012 has been presented in line with the requirements of
IAS 1.
Non-GAAP financial measures
For the purposes of this preliminary announcement and the annual
report and accounts, the Group uses alternative non-Generally
Accepted Accounting Practice ("non-GAAP") financial measures which
are not defined within IFRS. The Directors use these measures in
order to assess the underlying operational performance of the
Group, and as such, these measures are important and should be
considered alongside the IFRS measures. The following non-GAAP
measures are referred to in the preliminary announcement:
a) Trading profit/loss
'Trading profit/loss' is separately disclosed, being defined as
operating profit adjusted to exclude restructuring costs and
compensation for loss of office, payments to LTIP holders and
bonuses in connection with the Disney settlement, and other
non-recurring costs. Other non-recurring costs relate to items
which management believe do not accurately reflect the underlying
trading performance of the business in the period. Examples of
other non-recurring costs are one off costs and charges incurred
which management believe do not accurately reflect the trading
performance of the business. The Directors believe that trading
profit/loss is an important measure of the underlying performance
of the Group.
b) Adjusted earnings per share
'Adjusted earnings per share' is calculated by dividing the
profit for the period excluding restructuring costs and
compensation for loss of office, payments to LTIP holders and
bonuses in connection with the Disney settlement, other
non-recurring costs and the deferred tax charge/credit by the
weighted average number of ordinary shares in issue during the
period. The Directors believe that adjusted earnings per share
provides an important measure of the underlying performance of the
Group.
c) Trading EBITDA
Trading earnings before interest, taxation, depreciation and
amortisation ('Trading EBITDA') is separately disclosed in note 2,
being defined as trading profit/loss adjusted to exclude
depreciation and amortisation of software, as well as any
impairment which has been included in trading profit/loss. Trading
EBITDA includes profits on disposal of property, plant and
equipment. The Directors believe that trading EBITDA is an
important measure of the underlying performance of the Group.
d) Trading operating expenses
'Trading operating expenses' is separately disclosed, being
defined as operating expenses adjusted to exclude restructuring
costs and compensation for loss of office, payments to LTIP holders
and bonuses in connection with the Disney settlement, and other
non-recurring costs. The Directors believe that trading operating
expenses are an important measure of the underlying performance of
the Group.
9. Annual general meeting
The Annual General Meeting of the Company will be held at 10am
on 5 March 2015 at Unit E2, Sussex Manor Business Park, Gatwick
Road, Crawley, West Sussex, RH10 9NH.
10. Annual report and accounts
Copies of the full Statutory Accounts will be dispatched to
shareholders in due course. Copies will also be available on the
Company's website (www.avesco.com) and from the registered office
of the Company: Unit E2, Sussex Manor Business Park, Gatwick Road,
Crawley, West Sussex, RH10 9NH.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR DZLFFEFFBBBV
Avesco (LSE:AVS)
Historical Stock Chart
From Mar 2024 to Apr 2024
Avesco (LSE:AVS)
Historical Stock Chart
From Apr 2023 to Apr 2024
