Acquisition

RNS Number:3735F
Electric Word PLC
09 October 2007


 

9 October 2007

                               Electric Word plc                                
 

                    Acquisition expands Education Publishing                    
 

Electric Word plc, the specialist information publisher, announces today the
acquisition of Speechmark Publishing Ltd ("Speechmark") for a cash consideration
of #2.0m.
 

Speechmark, which as Winslow Press was established in 1984, is a leading
publisher of books and other resources for speech therapists and Special Needs
professionals in schools and other children's and adults' services, and will
complement the Group's current Special Needs publications. At the heart of the
business is its range of Colorcards photographic resources, which have built an
international reputation across the US and Europe over the last twenty years.


In the year to December 2006, Speechmark reported pre-tax profits of #22,000 on
revenues of #1.7m. The Directors expect that Speechmark's pre-tax profits for
the year ending December 2007, before integration costs, will be no less than
#180,000.
 

The consideration of #2.0m is comprised of an initial payment of #1.35m and the
issue of loan notes to the value of #650,000. The loan notes are issued in two
tranches, #150,000 bearing interest at base rate repayable within six months and
#500,000 bearing no interest and repayable within twelve months. The initial
consideration will be funded through a revolving credit facility of #1.5m and
the redemption of the loan notes through cashflow.


The acquisition is expected to be immediately earnings enhancing, excepting
initial integration costs in the period to December 2007*.


The existing Electric Word businesses continue to meet the Board's expectations
for the current year.

 

Julian Turner, Electric Word's Chief Executive, commented:

 

"Speechmark is an award-winning publisher with an outstanding reputation built
over many years. Its speech and language therapy and other products fit well
with our existing strength in Special Needs education and we look forward to
employing Electric Word's educational publishing and marketing expertise in
further developing the business. With the synergies we can achieve within
Electric Word we anticipate Speechmark making a positive contribution to
earnings in its first full year of ownership."

 

                                    - ends -                                    

                                                                                
Julian Turner, Chief Executive      Helen Thomas / Tim Spratt           
Electric Word plc, 0207 954 3470    Financial Dynamics, 0207 831 3113   

                                    
                                     

* For the avoidance of doubt, this statement should not be construed as a profit
forecast, and the statement regarding earnings enhancement should not be
interpreted to mean that earnings per share will necessarily be greater than
those for the relevant preceding financial period.



                      This information is provided by RNS
            The company news service from the London Stock Exchange

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