TIDMAVS
RNS Number : 6627A
Avesco Group PLC
09 June 2016
9 June 2016
AVESCO GROUP plc
RESULTS FOR THE SIX MONTHSED 31 MARCH 2016
Avesco Group plc (AIM: AVS), a leading international provider of
services to the corporate presentation, entertainment and broadcast
markets, announces its results for the six months ended 31 March
2016.
KEY HIGHLIGHTS FOR THE SIX MONTHS TO 31 MARCH 2016
-- Revenues increased to GBP73.0m (six months ended 31 March 2015: GBP66.0m)
-- Operating profit increased to GBP15.3m (six months ended 31 March 2015: GBP5.5m)
-- Completion of the previously announced sale of the land and
buildings at Fountain Studios, generating a profit before tax of
GBP9.8m (GBP7.7m after tax)
-- Trading profit of GBP4.6m (six months ended 31 March 2015: GBP5.5m)*
-- Trading EBITDA of GBP13.4m (six months ended 31 March 2015: GBP14.6m)*
-- Profit before tax of GBP14.6m (six months ended 31 March 2015: GBP4.6m)
-- Basic earnings per share from continuing operations of 53.8p
(six months ended 31 March 2015: 13.3p)
-- Adjusted continuing basic earnings per share of 13.3p (six
months ended 31 March 2015: 13.3p) *
-- Interim dividend increased by a quarter to 2.5p (six months ended 31 March 2015: 2.0p)
-- Net assets per share of 230p (31 March 2015: 180p)
* As described in note 3, the Group uses certain non-GAAP
alternative measures to assess underlying operating
performance.
Richard Murray, Chairman, commented:
"The Avesco Group has again delivered a strong first half
performance, with interim operating profits for the six month
period to 31 March 2016 (which include the profit on the sale of
the land and buildings at Fountain Studios) once more at record
levels and net debt reduced to just GBP3.2m.
Trading in the six months to 31 March 2016 has not been without
its challenges, but our core CT business continues to perform
strongly. With net debt now at historically low levels and the Rio
2016 Olympic Games to come over the summer, the outlook for the
Group remains very positive."
For further information please contact:
Avesco Group plc
Richard Murray, Chairman 01293 583 400
John Christmas, Group Finance
Director
finnCap
Julian Blunt/Scott Mathieson,
Corporate Finance
Malar Velaigam, Corporate
Broking 020 7220 0500
Chairman's Statement
The Avesco Group has again delivered a strong first half
performance, with interim operating profits for the six month
period to 31 March 2016 (which include the profit on the sale of
the land and buildings at Fountain Studios) once more at record
levels and net debt reduced to just GBP3.2m. Whilst the Board's
view of the outlook for the full year remains positive, when the
Fountain Studios sale is excluded, the underlying trading results
for the first six months of the year are, as expected, down
slightly on the corresponding period last year, due in part to the
timing of certain events. The Creative Technology ("CT") division
was once again the star performer, whilst trading at mclcreate has
been disappointing.
Results
Revenue in the six months ended 31 March 2016 increased to
GBP73.0m (six months ended 31 March 2015: GBP66.0m). However, a
combination of reduced gross margins (caused by strong pricing
pressures, particularly around LED products) and increased
overheads (mainly in CTUS, which had until now been able to delay
the increase in staff numbers required by its revenue growth) has
seen trading profit for the six months ended 31 March 2016 reduce
to GBP4.6m (six months ended 31 March 2015: GBP5.5m). Trading
profits exclude the profit on the sale of the land and buildings at
Fountain Studios (GBP9.8m), restructuring credits in Germany and
from the sub-letting of a previously provided onerous lease in
mclcreate, coupled with other non-recurring costs (together
amounting to a GBP0.9m credit to the income statement). There were
no such exceptional items in the corresponding period last
year.
Operating profit for the six months ended 31 March 2016 was
therefore GBP15.3m (six months ended 31 March 2015: GBP5.5m), and
the basic earnings per share from continuing operations increased
to 53.8p (six months ended 31 March 2015: 13.3p), although this
increase benefits significantly from the disposal and expected
closure of Fountain Studios. Excluding the results of this
transaction, adjusted continuing basic earnings per share was
13.3p.
A combination of underlying revenue growth and the timing of
events coupled with some favourable foreign exchange movements on
the US Dollar meant that our main trading division, CT, saw
revenues grow by 20% to GBP61.9m (six months ended 31 March 2015:
GBP51.6m). Trading profit grew by GBP0.4m to GBP5.9m (six months
ended 31 March 2015: GBP5.5m) with CTUS again providing the bulk of
CT's profits, although CT London contributed significantly improved
results and CT Asia Pacific was able to continue its progress as it
works towards achieving profitability in the region. Our CT
business in Qatar suffered however, with the effects of the current
low oil price seeing a marked reduction in the number and size of
events in the region although in contrast the Dubai office produced
a much stronger performance. Despite pricing pressures, an increase
in the worldwide demand for the use of LED products in shows and
events has resulted in us looking to invest more in equipment than
we had planned at the beginning of the year, thus enabling us to
reduce sub hires and improve margins where we can.
Our Full Service business, mclcreate, had a particularly poor
six months, with revenue down 25% to GBP5.9m (six months ended 31
March 2015: GBP7.9m) incurring a trading loss of GBP0.3m (six
months ended 31 March 2015: GBP0.6m trading profit). Cancelled
events, a poor conversion rate and office relocations all played a
part in the disappointing performance but we expect trading to
improve in the second half of the year.
In our Broadcast Services division, revenue dipped to GBP5.4m
(six months ended 31 March 2015: GBP6.8m) resulting in a trading
loss of GBP0.9m (six months ended 31 March 2015: GBP0.4m loss).
Fountain Studios was adversely affected by the televising of the
2015 Rugby World Cup in October, reducing the number of X Factor
shows broadcast live from the studios. As for Presteigne Broadcast
Hire, the steps we have taken to bolster the sales team have yet to
bear fruit. Moreover, whilst we have made significant progress over
the last two years in reducing the odd year / even year profit
swing in the Group, Presteigne retains some such sensitivity. With
the Rio 2016 Olympic Games this summer, we are expecting an
improved performance from Presteigne over the year as a whole.
Last year the Group had an effective tax rate of 45% as high
taxable profits earned in the US (which are taxed at around 40%)
cannot be offset against taxable losses elsewhere in the world. For
the six months ended 31 March 2016 however, with the substantial
gain on the sale of the land and buildings at Fountain subject to
tax in the UK (with its 20% corporation tax charge), the overall
effective tax rate has been reduced to 30%.
The GBP16m cash that the Group received on the sale of the land
and buildings at Fountain has helped our net debt balance reduce
from last year end's GBP17.5m to a very modest GBP3.2m. With
tangible fixed assets of GBP52.5m (31 March 2015: GBP58.7m) and net
assets of GBP44.0m (31 March 2015: GBP34.3m) or GBP2.30 per share
(31 March 2015: GBP1.80 per share) the Group maintains a strong
balance sheet.
As a sign of the Board's confidence in the outcome for the
current year, we are again increasing the interim dividend, this
time to 2.5p per share (2015: 2.0p per share). This payment will be
made on 3 October 2016 to shareholders on the register on 2
September 2016 and the shares will be quoted ex dividend from 1
September 2016.
Fountain
We completed our sale of the land and buildings at Fountain
Studios on 5 February 2016 for GBP16m, producing a profit before
tax of GBP9.8m (GBP7.7m after tax) in the six months ended 31 March
2016. In the second half of the year ended 30 September 2015 we
impaired the fixtures and fittings in the studios by GBP1.3m, and
we plan to sell these in advance of the expected site closure in
early 2017.
Outlook
Trading in the six months to 31 March 2016 has not been without
its challenges, but our core CT business continues to perform
strongly thanks in part to the quality and reputation of our
exceptional staff. With net debt now at historically low levels and
the Rio 2016 Olympic Games to come over the summer, the outlook for
the Group remains very positive.
Richard Murray
June 2016
Unaudited condensed consolidated income statement
For the six months ended 31 March 2016
Year
Six months ended
ended 31 March 30 September
2016 2015 2015
GBP000s GBP000s GBP000s
------------------------------------ ----------- --------- --------------
Continuing operations
Revenue 72,967 65,974 133,674
Cost of sales (46,062) (40,060) (83,035)
------------------------------------ ----------- --------- --------------
Gross profit 26,905 25,914 50,639
Operating expenses and
income (11,639) (20,407) (45,754)
Share of associate's profit/(loss) - (28) (27)
------------------------------------ ----------- --------- --------------
Trading profit 4,586 5,479 7,357
Exceptional items 10,680 - (2,499)
------------------------------------ ----------- --------- --------------
Operating profit 15,266 5,479 4,858
Finance income 2 3 6
Finance costs (694) (863) (1,656)
------------------------------------ ----------- --------- --------------
Profit before income tax 14,574 4,619 3,208
Income tax expense (4,306) (2,098) (854)
------------------------------------ ----------- --------- --------------
Profit from continuing
operations 10,268 2,521 2,354
Profit on discontinued
operation, net of tax - - 1,072
Profit for the financial
period 10,268 2,521 3,426
------------------------------------ ----------- --------- --------------
Attributable to:
Owners of the Company 10,289 2,542 3,032
Non-controlling interests (21) (21) 394
------------------------------------ ----------- --------- --------------
10,268 2,521 3,426
------------------------------------ ----------- --------- --------------
Pence
Pence per Pence
per share share per share
Earnings per share for
profit attributable to
the equity holders of
the company
- basic 53.8p 13.3p 18.0p
- diluted 53.8p 13.1p 17.9p
Earnings per share for
profit attributable to
the equity holders of
the company from continuing
operations
- basic 53.8p 13.3p 12.4p
- diluted 53.8p 13.1p 12.3p
Unaudited alternative performance measures (non-GAAP)
For the six months ended 31 March 2016
Year
Six months ended
ended 31 March 30 September
2016 2015 2015
GBP000s GBP000s GBP000s
------------------------ ------------------------ ------------------------ -------------------
Operating profit 15,266 5,479 4,858
Adjusted to exclude:
Restructuring costs
and compensation
for loss of office (953) - 1,088
Disposal and expected
closure of Fountain
Studios (9,787) - 1,299
Other non-recurring
costs 60 - 112
------------------------ ------------------------ ------------------------ -------------------
Exceptional items (10,680) - 2,499
Trading profit 4,586 5,479 7,357
Net finance costs (692) (860) (1,650)
Trading profit after
net finance costs 3,894 4,619 5,707
------------------------ ------------------------ ------------------------ -------------------
Adjusted profit from
continuing operations 2,528 2,521 3,393
Trading EBITDA 13,390 14,611 26,955
------------------------ ------------------------ ------------------------ -------------------
Refer to note 3 for a full description of the alternative
performance measures adopted by the Group.
Unaudited condensed consolidated statement of comprehensive
income
For the six months ended 31 March 2016
Year
Six months ended
ended 31 March 30 September
2016 2015 2015
GBP000s GBP000s GBP000s
--------------------------- -------- -------- --------------
Profit for the period 10,268 2,521 3,426
Other comprehensive
income
Currency translation
differences 670 965 511
--------------------------- -------- -------- --------------
Total comprehensive
income for the period 10,938 3,486 3,937
--------------------------- -------- -------- --------------
Attributable to:
Owners of the Company 10,959 3,507 3,543
Non-controlling interests (21) (21) 394
--------------------------- -------- -------- --------------
10,938 3,486 3,937
--------------------------- -------- -------- --------------
All items in other comprehensive income will be recycled
subsequently to the income statement.
Unaudited condensed consolidated balance sheet
As at 31 March 2016
31 March 31 March 30 September
2016 2015 2015
GBP000s GBP000s GBP000s
-------------------------------- --------- ----------------------- -------------------------
Assets
Non-current assets
Property, plant and
equipment 52,470 58,748 54,266
Intangible assets 229 121 209
Deferred income tax
assets 3,758 3,793 4,585
Trade and other receivables 138 147 141
--------------------------------- --------- ----------------------- -------------------------
56,595 62,809 59,201
Current assets
Inventories 1,008 757 649
Trade and other receivables 31,263 30,210 25,860
Current income tax assets - - 1,483
Cash and cash equivalents 22,966 10,398 12,749
55,237 41,365 40,741
-------------------------------- --------- ----------------------- -------------------------
Total assets 111,832 104,174 99,942
--------------------------------- --------- ----------------------- -------------------------
Liabilities
Non-current liabilities
Borrowings and loans 16,836 26,507 21,866
Deferred income tax
liabilities 4,593 4,933 5,330
Provisions 763 1,770 2,735
--------------------------------- --------- ----------------------- -------------------------
22,192 33,210 29,931
Current liabilities
Trade and other payables 29,810 25,079 25,138
Current income tax liabilities 3,565 1,870 876
Borrowings and loans 9,367 8,948 8,345
Provisions 2,946 768 1,233
---------------------------------
45,688 36,665 35,592
-------------------------------- --------- ----------------------- -------------------------
Total liabilities 67,880 69,875 65,523
--------------------------------- --------- ----------------------- -------------------------
Total assets less total
liabilities 43,952 34,299 34,419
--------------------------------- --------- ----------------------- -------------------------
Equity
Capital and reserves
attributable to equity
holders of the company
Ordinary shares 2,095 2,095 2,095
Share premium 11,194 11,194 11,194
Capital redemption 12,646 12,646 12,646
Translation reserves 1,413 1,197 743
Retained earnings 16,587 7,141 7,633
--------------------------------- --------- ----------------------- -------------------------
Equity attributable
to owners of the Company 43,935 34,273 34,311
Non-controlling interests 17 26 108
--------------------------------- --------- ----------------------- -------------------------
Total equity 43,952 34,299 34,419
--------------------------------- --------- ----------------------- -------------------------
Unaudited condensed consolidated statement of changes in
equity
For the six months ended 31 March 2016
Share Share Capital
capital premium redemption Other Retained Non-controlling Total
account account reserve reserves earnings Total interest equity
GBP000s GBP000s GBP000s GBP000s GBP000s GBP000s GBP000s GBP000s
------------------ --------------- --------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
Balance at 1
October 2015 2,095 11,194 12,646 743 7,633 34,311 108 34,419
Profit/(loss)
for the period - - - - 10,289 10,289 (21) 10,268
Other
comprehensive
income net of
tax - - - 670 - 670 - 670
------------------- --------------- --------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
Total
comprehensive
income/(expense) - - - 670 10,289 10,959 (21) 10,938
Transactions
with owners
in their capacity
as owners:
External dividends
paid - - - - (1,335) (1,335) (70) (1,405)
------------------- --------------- --------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
Balance at 31
March 2016 2,095 11,194 12,646 1,413 16,587 43,935 17 43,952
------------------- --------------- --------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
Share Share Capital
capital premium redemption Other Retained Non-controlling Total
account account reserve reserves earnings Total interest equity
GBP000s GBP000s GBP000s GBP000s GBP000s GBP000s GBP000s GBP000s
------------------ --------------- --------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
Balance at 1
October 2014 2,095 11,194 12,646 232 5,976 32,143 - 32,143
Profit/(loss)
for the period - - - - 2,542 2,542 (21) 2,521
Other
comprehensive
income net of
tax - - - 965 - 965 - 965
------------------- --------------- --------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
Total
comprehensive
income/(expense) - - - 965 2,542 3,507 (21) 3,486
Transactions
with owners
in their capacity
as owners:
Non-controlling
interest acquired - - - - - - 47 47
External dividends
paid - - - - (1,141) (1,141) - (1,141)
LTIP and share
options - - - - (236) (236) - (236)
------------------- --------------- --------------- ---------------- ---------------- ---------------- ---------------- ----------------
Balance at 31
March 2015 2,095 11,194 12,646 1,197 7,141 34,273 26 34,299
------------------- --------------- --------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
Share Share Capital
capital premium redemption Other Retained Non-controlling Total
account account reserve reserves earnings Total interest equity
GBP000s GBP000s GBP000s GBP000s GBP000s GBP000s GBP000s GBP000s
------------------ --------------- --------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
Balance at 1
October 2014 2,095 11,194 12,646 232 5,976 32,143 - 32,143
Profit for the
period - - - - 3,032 3,032 394 3,426
Other
comprehensive
income net of
tax - - - 511 - 511 - 511
------------------- --------------- --------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
Total
comprehensive
income - - - 511 3,032 3,543 394 3,937
Transactions
with owners
in their capacity
as owners:
Non-controlling
interest acquired - - - - - - 47 47
External dividends
paid - - - - (1,141) (1,141) (333) (1,474)
LTIP and share
options - - - - (234) (234) - (234)
----------------
Balance at 30
September 2015 2,095 11,194 12,646 743 7,633 34,311 108 34,419
------------------- --------------- --------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
Unaudited condensed consolidated cash flow statement
For the six months ended 31 March 2016
Year
Six months ended
ended 31 March 30 September
2016 2015 2015
GBP000s GBP000s GBP000s
----------------------------------- --------------------- --------------------- ---------------------
Cash flows from operating
activities
Cash generated from
operations 11,382 9,286 26,292
Income tax paid (136) (1,488) (2,942)
Net cash generated
from operating activities 11,246 7,798 23,350
----------------------------------- --------------------- --------------------- ---------------------
Cash flows from investing
activities
Purchases of property,
plant and equipment (11,849) (12,439) (19,237)
Proceeds from sale
of property, plant
and equipment 16,705 2,296 3,262
Interest received 2 2 6
Acquisition of subsidiary - 634 634
Net cash generated
from/(used in) investing
activities 4,858 (9,507) (15,335)
----------------------------------- --------------------- --------------------- ---------------------
Cash flows from financing
activities
Interest paid (688) (838) (1,640)
Proceeds from borrowings 8,503 15,381 23,672
Repayments of borrowings (14,141) (11,807) (25,031)
Dividends paid to Company's
shareholders (382) (283) (1,141)
Dividends paid to non-controlling
interest (70) - (333)
--------------------- ---------------------
Net cash (used in)/generated
from financing activities (6,778) 2,453 (4,473)
----------------------------------- --------------------- --------------------- ---------------------
Net increase in cash,
cash equivalents and
bank overdrafts 9,326 744 3,542
Cash, cash equivalents
and bank overdrafts
at beginning of period 12,737 8,968 8,968
Exchange gains on cash
and bank overdrafts 629 686 227
Cash, cash equivalents
and bank overdrafts
at end of period 22,692 10,398 12,737
Bank overdrafts at
end of period 274 - 12
Cash, cash equivalents
at end of period 22,966 10,398 12,749
----------------------------------- --------------------- --------------------- ---------------------
Notes to the interim report and accounts
1. General information
Avesco Group plc ('the Company') and its subsidiaries (together
'the Group') is an international media services business. The Group
has subsidiaries around the world and sells in the UK, USA, Europe,
Asia Pacific and the Middle East.
The Company is a public limited company which is admitted to
trading on the AIM Market of the London Stock Exchange and is
incorporated and domiciled in the UK. The address of its registered
office is Unit E2, Sussex Manor Business Park, Gatwick Road,
Crawley, West Sussex, RH10 9NH.
The registered number of the Company is 01788363.
2. Status of interim report and accounts
The interim report and accounts are unaudited but have been
reviewed by the auditors, Ernst & Young LLP, and their
independent review report is appended to this document. The interim
report and accounts, which were approved by the Board of Directors
on 9 June 2016, are not full accounts within the meaning of section
435 of the Companies Act 2006.
The figures for the year ended 30 September 2015 have been
extracted from the audited annual report and accounts that have
been delivered to the Registrar of Companies. The auditors, Ernst
& Young LLP, reported on those accounts under section 495 of
the Companies Act 2006. Their report was unqualified and did not
contain a statement under section 498 of that Act.
3. Basis of preparation
The interim report and accounts have been prepared using the
accounting policies to be applied in the annual report and accounts
for the year ending 30 September 2016. These are consistent with
those included in the previously published annual report and
accounts for the year ended 30 September 2015, which have been
prepared in accordance with IFRS as adopted by the European
Union.
The directors have a reasonable expectation that the Group has
adequate resources to continue operating for the foreseeable
future, and for this reason they have adopted the going concern
basis of preparation in the consolidated interim financial
statements.
Alternative performance measures
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
these interim report and accounts.
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, profits and losses from the
disposal and expected closure of Fountain Studios, 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 profit from continuing operations
'Adjusted profit from continuing operations' is separately
disclosed, being defined as profit from continuing operations
adjusted to exclude profits and losses from the disposal and
expected closure of Fountain Studios, net of tax. The Directors
believe that adjusted profit from continuing operations is an
important measure of the underlying performance of the Group.
c) Adjusted continuing basic earnings per share
'Adjusted continuing basic earnings per share' is calculated by
dividing the adjusted profit from continuing operations for the
period by the weighted average number of ordinary shares in issue
during the period. The Directors believe that Adjusted continuing
basic earnings per share provides an important measure of the
underlying performance of the Group.
d) Trading EBITDA
Trading earnings before interest, taxation, depreciation and
amortisation ('EBITDA') is separately disclosed, being defined as
trading profit/loss adjusted to exclude depreciation and
amortisation of software. 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.
4. Segmental information
Year
Six months ended
ended 31 March 30 September
2016 2015 2015
GBP000s GBP000s GBP000s
----------------------- -------- -------- --------------
Revenue
Creative Technology 61,918 51,624 107,374
Full Service 5,947 7,889 14,060
Broadcast 5,411 6,756 12,989
Inter Segment revenue (309) (295) (749)
----------------------- -------- --------------
Group revenue 72,967 65,974 133,674
----------------------- -------- -------- --------------
Operating profit
Creative Technology 5,888 5,478 9,132
Full Service (282) 558 265
Broadcast (867) (431) (1,923)
Head Office (153) (126) (117)
----------------------- -------- --------------
Trading profit 4,586 5,479 7,357
Restructuring costs
and compensation for
loss of office 953 - (1,088)
Disposal of Fountain
Studios 9,787 - (1,299)
Other non-recurring
costs (60) - (112)
Operating profit 15,266 5,479 4,858
----------------------- -------- -------- --------------
5. Trading earnings before interest, taxation, depreciation and amortisation ('EBITDA')
Year
Six months ended
ended 31 March 30 September
2016 2015 2015
GBP000s GBP000s GBP000s
-------------------------- -------- -------- --------------
Trading profit 4,586 5,479 7,357
Depreciation 8,745 9,093 18,357
Impairment - - 1,158
Amortisation of software 59 39 83
Trading EBITDA 13,390 14,611 26,955
-------------------------- -------- -------- --------------
Trading EBITDA is defined in note 3.
6. Taxation
Year
Six months ended
ended 31 March 30 September
2016 2015 2015
GBP000s GBP000s GBP000s
------------------------ -------- -------- --------------
Current tax:
Current tax charge
on profits for the
year 4,332 2,653 3,461
Adjustments in respect
of prior periods - - (1,749)
------------------------ -------- -------- --------------
Total current tax 4,332 2,653 1,712
Deferred tax credit (26) (555) (858)
------------------------ -------- -------- --------------
Income tax expense 4,306 2,098 854
------------------------ -------- -------- --------------
7. Earnings per share
Year
Six months ended
ended 31 March 30 September
2016 2015 2015
GBP000s GBP000s GBP000s
----------------------------- ---------------------- ---------------------- --------------------
Profit for the financial
period 10,268 2,521 3,426
Profit on discontinued
operations, net of
tax - - (1,072)
----------------------------- ---------------------- ---------------------- --------------------
Profit from continuing
operations 10,268 2,521 2,354
Disposal and expected
closure of Fountain
Studios, net of tax (7,740) - 1,039
----------------------------- ---------------------- ---------------------- --------------------
Adjusted profit from
continuing operations 2,528 2,521 3,393
----------------------------- ---------------------- ---------------------- --------------------
Weighted average number
of shares (net of treasury
shares)
For basic earnings
per share (000's) 19,077 18,930 19,004
Effect of dilutive
share options (000's) - 298 148
For diluted earnings
per share (000's) 19,077 19,228 19,152
----------------------------- ---------------------- ---------------------- --------------------
Earnings per share
Basic 53.8p 13.3p 18.0p
Diluted 53.8p 13.1p 17.9p
----------------------------- ---------------------- ---------------------- --------------------
Continuing basic 53.8p 13.3p 12.4p
Continuing diluted 53.8p 13.1p 12.3p
----------------------------- ---------------------- ---------------------- --------------------
Adjusted continuing
basic 13.3p 13.3p 17.9p
Adjusted continuing
diluted 13.3p 13.1p 17.7p
----------------------------- ---------------------- ---------------------- --------------------
Discontinued operations
basic 0.0p 0.0p 5.6p
Discontinued operations
diluted 0.0p 0.0p 5.6p
----------------------------- ---------------------- ---------------------- --------------------
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 historic Long Term Incentive Plan ("LTIP")
where pre-specified performance conditions have been satisfied and
any required conversion of dilutive potential options.
Adjusted profit from continuing operations and adjusted
continuing basic earnings per share are alternative performance
measure adopted by the Group (refer to note 3).
8. Analysis of net debt
Other At
At non Currency 31
1 October Cash cash translation March
2015 flow changes differences 2016
GBP000s GBP000s GBP000s GBP000s GBP000s
----------------- ----------- -------- ---------------- ---------------- -----------
Cash at bank
and in hand 12,749 9,588 - 629 22,966
Bank overdrafts (12) (262) - - (274)
------------------- ----------- -------- ---------------- ---------------- -----------
Net cash 12,737 9,326 - 629 22,692
Bank loans
due in more
than one year (14,854) 5,915 - (619) (9,558)
Hire purchase
obligations
due in less
than one year (8,333) 3,417 (3,761) (416) (9,093)
Hire purchase
obligations
due in more
than one year (7,012) (3,694) 3,761 (333) (7,278)
Net debt (17,462) 14,964 - (739) (3,237)
------------------- ----------- -------- ---------------- ---------------- -----------
Other At
At non Currency 31
1 October Cash cash translation March
2014 flow changes differences 2015
GBP000s GBP000s GBP000s GBP000s GBP000s
----------------- ----------- -------- ---------------- ---------------- -----------
Cash at bank
and in hand 9,065 636 - 697 10,398
Bank overdrafts (97) 108 - (11) -
------------------- ----------- -------- ---------------- ---------------- -----------
Net cash 8,968 744 - 686 10,398
Bank loans
due in more
than one year (16,848) 1,000 - (634) (16,482)
Hire purchase
obligations
due in less
than one year (7,805) 2,241 (2,988) (396) (8,948)
Hire purchase
obligations
due in more
than one year (5,754) (6,815) 2,988 (444) (10,025)
Net debt (21,439) (2,830) - (788) (25,057)
------------------- ----------- -------- ---------------- ---------------- -----------
Other At
At non Currency 30
1 October Cash cash translation September
2014 flow changes differences 2015
GBP000s GBP000s GBP000s GBP000s GBP000s
----------------- ----------- -------- ---------------- ---------------- -----------
Cash at bank
and in hand 9,065 3,447 - 237 12,749
Bank overdrafts (97) 95 - (10) (12)
------------------- ----------- -------- ---------------- ---------------- -----------
Net cash 8,968 3,542 - 227 12,737
Bank loans
due in more
than one year (16,848) 2,500 - (506) (14,854)
Hire purchase
obligations
due in less
than one year (7,805) 6,649 (6,827) (350) (8,333)
Hire purchase
obligations
due in more
than one year (5,754) (7,790) 6,827 (295) (7,012)
-----------
Net debt (21,439) 4,901 - (924) (17,462)
------------------- ----------- -------- ---------------- ---------------- -----------
9. Interim and final dividends
A final dividend for the year ended 30 September 2015 of 5.0p
per ordinary share amounting to a total of GBP953,000 was approved
and was paid on 6 April 2016 to shareholders on the register on 11
March 2016.
An interim dividend for the year ended 30 September 2015 of 2.0p
per ordinary share amounting to a total of GBP382,000 was approved
and was paid on 1 October 2015 to shareholders on the Register on 4
September 2015.
An interim dividend of 2.5p per ordinary share will be paid on 3
October 2016 to shareholders on the Register at 6.00pm on 2
September 2016. The shares will be quoted ex dividend from 1
September 2016.
10. Disposal and expected closure of Fountain Studios
On 5 February 2016 Fountain Television Limited ("Fountain"), a
subsidiary of the Group, sold the freehold land and buildings at
its television studios in Wembley to Fulton Road Limited, for a
cash consideration of GBP16m . At the same time, Fountain entered
into a lease back of the premises from the buyer at a nominal rent
for a term of five years. The lease was capable of termination by
either party on not less than six months' notice, expiring no
earlier than 28 February 2017 (that date having been extended by
agreement with the buyer from 31 December 2016). The lease has now
been terminated by the landlord by notice to expire on 28 February
2017.
The expiry of the lease of the premises is likely to lead to the
closure of the Fountain Studios business in Wembley and Fountain
has therefore commenced a consultation process with its staff.
During the year ended September 2015, Fountain reported revenues of
GBP5.6m and a loss before tax (and before impairment) of GBP0.4m.
At the end of its lease of the premises, the plant and equipment
owned by Fountain will be moved or sold and, in anticipation of
these eventual disposals, an impairment charge of GBP1.3m was
recognised in exceptional items for the year ended 30 September
2015.
Once the net book value of the land and buildings (GBP5.2m) and
tax and other additional costs (total of GBP3.1m) are taken into
account, a profit of GBP7.7m in relation to the Fountain
transaction has been recognised in the six months to 31 March
2016.
11. Distribution of interim report and accounts
Copies of this interim report and accounts are available from
the Company's web site (www.avesco.com) or from the Company's
registered office: Avesco Group plc, Unit E2, Sussex Manor Business
Park, Gatwick Road, Crawley, West Sussex, RH10 9NH. Telephone: +44
(0) 1293 583 400. Fax: +44 (0) 1293 583 410. E-mail:
mail@avesco.com.
INDEPENDENT REVIEW REPORT TO AVESCO GROUP PLC
Introduction
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 31 March 2016, which comprises the consolidated
income statement, consolidated statement of comprehensive income,
consolidated balance sheet, consolidated statement of changes in
equity and consolidated cash flow statement and the related
explanatory notes that have been reviewed. 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
guidance contained in International Standard on Review Engagements
2410 (UK and Ireland) "Review of Interim Financial Information
Performed by the Independent Auditor of the Entity" issued by the
Auditing Practices Board. To the fullest extent permitted by law,
we do not accept or assume responsibility to anyone other than the
Company, for our work, for this report, or for the conclusions we
have formed.
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 AIM Rules issued by the London Stock Exchange which require
that it is presented and prepared in a form consistent with that
which will be adopted in the Company's annual accounts having
regard to the accounting standards applicable to such annual
accounts.
As disclosed in note 3, 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 the AIM Rules issued by the London Stock
Exchange.
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 31
March 2016 is not prepared, in all material respects, in accordance
with the accounting policies outlined in Note 3, which comply with
IFRS's as adopted by the European Union and in accordance with the
AIM Rules issued by the London Stock Exchange.
Ernst & Young LLP
Reading
9 June 2016
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR AKFDBABKDQAK
(END) Dow Jones Newswires
June 09, 2016 02:00 ET (06:00 GMT)
Avesco (LSE:AVS)
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