TIDMOOUT
RNS Number : 3320X
Ocean Outdoor Limited
04 May 2021
4 May 2021
Ocean Outdoor Limited
("Ocean" or the "Company" or the "Group")
2020 Full Year Results
Ocean Outdoor Limited (LSE: OOUT), a leading operator of premium
Digital Out-of-Home ("DOOH") advertising in the United Kingdom, the
Netherlands, the Nordics and Germany, today publishes its financial
results for the full year ended 31 December 2020.
Reported financials - protected core business during
pandemic:
-- Billings (1) recognised by the Group in FY20 were GBP104.7m (FY19: GBP135.1m)
-- Revenue generated by the business in the year totalled GBP86.2m (FY19: GBP104.0m)
-- Group gross profit was GBP22.5m (FY19: GBP44.9m)
-- One off impairment charge of GBP142m (FY19: nil) related to impact of COVID-19
-- Group loss before tax was GBP182.0m (FY19: GBP6.2m)
-- Successfully agreed GBP35m of debt facility to assist with
working capital requirements, with GBP5m drawn down by the year
end
-- Cash on balance sheet of GBP30.0m (FY19: GBP26.9m)
-- Net assets balance of GBP197.7m (FY19: GBP374.0m)
-- Cash generated from operations totalling GBP32.1m (FY19: GBP46.8m)
Unaudited proforma (2) figures:
-- Unaudited Group revenue of GBP86.2m on a proforma basis, down 38% (2019: GBP139.6m)
-- Unaudited Adjusted EBITDA(3) of GBP(0.4)m down from GBP32.9m
-- Reduced overheads (excluding depreciation and non-recurring
items) by GBP4.4m to GBP26.8m, down 14% (2019: GBP31.2m)
-- Continued to invest for growth - capital expenditure in new
locations of GBP6.4 million (2019: GBP15.9 million)
-- Strong working capital management leading to GBP5.5m of operating free cash flow
Ongoing strategic investment and new contract wins:
-- Ocean Netherlands appointed as 10-year strategic media
partner for Westfield Mall of the Netherlands, contract value of
EUR7 million
-- Launched suite of new technological innovations with Ocean
Labs for wider appeal (3D forced perspective technology, mobile
augmented reality (AR) technology and touchless screen
technology)
-- Continued roadside network expansion in UK cities including
expansion of Two Towers(R) concept in Birmingham
-- Won four new media contracts in a competitive tender process
across the Nordics, leading to an additional 58 shopping malls
across Sweden, Norway, Denmark and Finland
-- Renewed three and extended two roadside contracts in the
Netherlands related to EUR1.8m of annual revenues
Momentum building in 2021:
-- Announced a sealed bid auction ahead of COP26 later this year
for brands wanting to appear on Ocean's large format DOOH screens
across Edinburgh and Glasgow
-- Exclusive UK digital content deal with BT Sport to broadcast
next day UEFA Champions League match clips across 7 key cities as
live sports return in the UK
-- Expansion of Ocean Netherlands media partnership with Dutch
Olympic team ahead of Tokyo 2021
-- Launched Amsterdam's First Digital Creative Competition
-- Oslo bus station, one of Norway's busiest transport
locations, launched with 28 new digital screens
(1) Billings represent the advertising spend by the advertiser,
including fees directly payable by the advertiser to their
advertising agency, exclusive of sales tax.
(2) Due to FY19 mid-year acquisitions the consolidated statement
of profit and loss presented does not provide a year-on-year
comparison for the underlying performance and operations. The
financial highlights detailed above are on an unaudited proforma
basis for Ocean Outdoor Limited and all subsidiaries in the Group
as at 31 December 2020 as if the same subsidiaries had been owned
from 1 January 2019.
(3) Earnings before interest, tax, depreciation, amortisation,
impairment on intangible assets, impairment on investments in
associates, deal fees, debt raise fees, foreign exchange gains or
losses, restructuring and redundancy costs, other one-off costs
& earn out payments designated as post completion compensation
under IFRS3. IFRS 16 has been removed, in order to provide
comparison on the prior period.
Tim Bleakley, Ocean's CEO, commented:
"Throughout the period Ocean Outdoor has continued to invest in
its platforms and products to prepare for the impending recovery.
With a strong balance sheet and growth opportunities in every area
of our operations, our focus is now on the speed of that recovery
as restrictions are lifted.
"We have never stood still. We have not only protected our core
businesses across all territories, but developed or won incremental
assets and contracts to accelerate growth, strengthening Ocean's
network proposition in key areas such as content partnerships, new
technology and brand experiences to maximise every opportunity for
advertisers as they return. Momentum is building and the
investments we have made means Ocean is exceptionally well placed
to reach and engage with highly receptive, liberated outdoor
audiences at scale. We have a strong underlying business, we are
well set for the recovery and we are already engaged in the fight
back."
A conference call for investors and analysts will take place on
4 May at 2021 at 13:00 BST / 08:00 ET. Dial-in details below:
UK Toll Free: 0808 109 0700
USA Toll Free: 1 866 966 5335
Standard International Access: +44 (0) 33 0551 0200
Password: Ocean Outdoor
A copy of the results presentation will be made available within
the investor relations section of the Company website once the
results are announced.
The Company's 2020 Annual Report & Accounts is also now
available via the investor relations section:
https://investors.oceanoutdoor.com
For further information please contact:
Ocean Outdoor
Tim Bleakley, CEO 020 7292
Susann Jerry, Head of Corporate Communications 6161
Yellow Jersey PR
Charles Goodwin
Joe Burgess 0774 778
Annabel Atkins 8221
Chairman's Statement
It is with pleasure that we present to you, the shareholders,
the Report and audited consolidated financial statements of Ocean
Outdoor Limited for the year ended 31 December 2020.
After such a promising start to 2020 with our ambitions set on
delivering another transformational year, the task from mid-March
rapidly changed with the immediate impact of COVID-19 causing
advertising spend to be switched off almost overnight and national
lockdowns commencing shortly after. Instantly, our priority was to
protect the staff and business.
With no visibility of how long the lockdowns in our territories
would last, or what the true impact of the pandemic was to be, the
Group had to prepare for a longer-term scenario. As such, the Group
moved quickly to negotiate with its landlords and suppliers and
utilise the support from its banks as well as government in order
to safeguard the core business. The entire team has done an
incredible job to shield the business, and on behalf of the Board,
I am truly grateful for the staff's tireless efforts during an
unprecedented period, which has put a huge stress on people's
lives, both physically and emotionally.
Whilst the summer months and third quarter saw a business
recovery, which coincided with the lifting of social restrictions,
unfortunately this was not to be sustained due to the pandemic
taking hold again in October and new lockdown measures being
enforced. However, what Ocean did experience in this open period
was a rapid, week-on-week increase in sales and bookings as brands
reactivated their campaigns. The positives here emphasised both the
demand for brands to be seen in our locations and the pace at which
Ocean digital's network operates, with its ability to launch high
impact campaigns on a national scale at the flick of a switch. We
anticipate experiencing this trend again once our markets begin to
move back to normality.
After working our way through one of the most extraordinary
periods in recent history, Ocean is now focused on the future and
playing its role in the recovery. The Group has continued to make
progress across a number of operational areas, creating a much more
efficient and innovative business, which is ready to capitalise on
advertising spend as brands switch on their campaigns.
One thing that has not changed is Ocean's strategy and its
proposition to push the boundaries of digital Out-of-Home
advertising. After completing a series of acquisitions in 2019 and
accelerating the integration of the Nordics business during the
first half of 2020, we have created the most dynamic, prime digital
Out-of-Home player across northern Europe.
Whilst caution and uncertainty remains, the vaccination
programmes underway across our territories are leading to renewed
optimism alongside the initial lifting of some lockdown
restrictions. In recent weeks, non-essential retail has reopened in
the UK in a positive way, with Westfield reporting 1.2 million
shoppers across both London malls on the first weekend after
reopening, which was 68% higher than the first weekend open after
the first lockdown. In the Netherlands, traffic has reach 75% of
pre-COVID levels in the first two weeks of April, whilst across the
Nordics region they have recorded traffic levels between 65% and
74% of those experienced pre-COVID. With urban roadside and premium
retail key pillars of Ocean's network, we are in the environments
people are returning to, and where brands want to be visible.
Ocean's network and offering continues to go from strength to
strength and the Group is an excellent position to capitalise on
the recovery. The Board and senior management team remain focused
on continuing to execute the strategy and we are confident that
Ocean will prosper as its markets open up fully.
Aryeh Bourkoff
Chairman
3 May 2021
Chief Executive's Review
Introduction
-- Navigated pandemic by working closely with partners and
landlords to manage costs and strengthened balance sheet with GBP35
million facility
-- Committed GBP6.4 million in 2020 to support further expansion
and upgrades to our state of the art DOOH product offering
-- Seeing encouraging early signs in 2021, particularly in the
UK with weekly bookings increasing in line with vaccine roll
out
It has been well documented that the pandemic has brought
unprecedented challenges to the Out-of-Home sector, with the public
lockdowns keeping people away from city centres and the spaces
where we primarily connect with our audiences. As we publish our
2020 figures, the outlook is beginning to look more promising than
four months ago, due to the success of the vaccination programmes
underway. Whilst they are at different stages across our
territories, a number of governments expect to have a significant
proportion of their populations vaccinated by summer 2021, and some
restrictions are starting to be eased, including the opening of
non-essential retail in the UK. Whilst it remains too early to
forecast how quickly Ocean will recover in 2021, we are seeing some
encouraging early signs as lockdown restrictions begin to ease,
with weekly bookings in the UK increasing in line with the vaccine
roll out. Whilst lockdown restrictions are being lifted at
different rates across the Netherlands and Nordics, both regions
are seeing good progress with their vaccination programmes
After enjoying a strong start to 2020 across all our
territories, from mid-March we saw media and advertising spend
quickly decline. With governments enforcing social restrictions at
the same time, the focus became mitigating the impact on Ocean,
with the Group immediately lowering its cost base while protecting
the core business and employees. Ocean has benefited throughout
from the good relationships it has with its landlords and
suppliers, working closely with them to negotiate on terms, which
has enabled payment deferrals and reductions to be accepted.
Whilst the Group's balance sheet was strong at the time the
pandemic hit our market, with net cash of almost GBP20 million, the
Board felt it was wise to look at options to further bolster the
Group's liquidity. Ocean entered into a GBP35 million facility
agreement, comprising of a term loan and revolving credit facility,
with GBP25 million of the new facility issued under the UK
government backed Coronavirus Large Business Interruption Loan
Scheme, which increased the Group's liquidity to GBP67 million. At
the year end the Group had drawn down GBP5 million from this
facility.
The easing of the initial restrictions at the start of the
summer period consequently saw bookings and revenues rebuild
week-on-week during late Q2 and Q3. However, the reintroduction of
lockdown measures across all territories in Q4, which is normally
the biggest period for advertisers in the lead up to Christmas, led
to brands pulling back on advertising spend and deferring
campaigns, resulting in a weaker conclusion to the year.
Our decision to continue with our organic growth plans, with a
total of GBP6.4 million invested during the year, supported the
further expansion and upgrades made to our state of the art DOOH
product offering. This means that the Group has put itself in the
best possible position to capitalise on demand as the sector
re-emerges. We believe that Ocean is the most dynamic operator in
its market and our focus on premium retail and city roadside will
support our ability to bounce back quickly as people return to our
cities and brands recommence their Out-of-Home advertising
campaigns.
.
Ocean UK
-- Undertook various initiatives during 2020 to remain visible
and used platform to support UK small businesses, charities and the
arts.
-- Expanded Ocean's Two Towers(R) concept in Birmingham and
added five more locations to XL roadside network.
-- Continued to incorporate further technologies into our
network to amplify brand engagement, including mid-air haptics
technology and mobile augmented reality.
As highlighted in our previous updates, throughout 2020, Ocean
has undertaken various initiatives to remain visible and use its
platform to support UK small businesses, charities and the arts.
Some of the highlights which have showcased our medium in global
news have included carrying The Queen's message to the UK back in
April 2020, the VE Day anniversary, the tributes to incredible
fundraising feat and life of war veteran Captain Sir Tom Moore on
the Piccadilly Lights, displaying the works held in the National
Gallery whilst it remains closed, and helping over 250 UK SMEs
through the combined GBP25 million advertising fund, which
supported businesses in both the UK and the Netherlands.
In terms of ongoing investment, in 2020 we committed GBP2.3
million to the UK expansion plans. This investment includes the
expansion of Ocean's Two Towers(R) concept in Birmingham, adding to
its coverage already in Manchester, Leeds and London, and the
ongoing expansion of the XL roadside network, with the
implementation of Ocean's next generation in super-sized, connected
DOOH roadside screens, which are 1.5 times larger than a standard
48-sheet. Five further locations were added during 2020, including
two in Southampton, two in Manchester and one in Birmingham -
bringing the total number of screens to 19 in four cities and
planning consent for two more in Leeds and Newcastle in 2021.
We are also pleased to have announced the roll-out of our first
premium large format DOOH screen in Norwich, one of the UK's top 10
fastest growing cities. It is the only large format full motion
screen in the city located above the entrance of the main shopping
centre, which is in close proximity to multiple premium retailers
and hospitality hotspots which attract an annual footfall of 15
million.
In terms of product innovation and technology developments,
Ocean partnered with the location marketing technology company
Hivestack, a leader in programmatic Digital Out-of-Home
advertising. Through Hivestack, marketers are now able to activate
Ocean's premium digital locations across the UK, enabling them to
run highly targeted campaigns that can be turned on or off
instantly. This is providing advertisers with a highly effective
and low risk route to market.
We have also become the first DOOH media owner in the UK to
deploy the use of Ultraleap's mid-air haptics technology to
facilitate touchless campaigns in key experiential spaces, enabling
consumers to interact and participate in a safe way conducive to
today's public environment. This technology was put into great
effect by Ocean Labs and the campaign created for the LEGO Group,
utilising the touchless screen technology to create the first ever
DOOH immersive play experience on an Ocean Outdoor screen at
London's Westfield Stratford shopping centre.
The innovation continued in December, with Ocean and Landsec
teaming up to work with Darabase to scale the interactive
capabilities of the Piccadilly Lights, using augmented reality
technology. Delivered via Darabase's platform, the technology used
a range of techniques including a virtual model to replicate the
sweep and scale of the Piccadilly screen to deliver large-scale
mobile AR experiences which amplify the big screen content on a
viewer's mobile handset.
Ocean Netherlands
-- Awarded the strategic media partnership contract for Westfield Mall of the Netherlands
-- Won tender for the large screen at the Amsterdam World Trade
Centre and media contract covering all buses and trams in
Amsterdam
-- Strengthened roadside network - winning three new contracts and renewing two
Our Dutch division made great strides during 2020 despite the
lockdown measures across the Netherlands, which has put the
business in an exciting position for the recovery. Since taking
over the digital advertising masts portfolio previously owned and
operated by Clear Channel Netherlands at the start of 2020, which
includes the iconic Triple Digital in Rotterdam, Double Digital in
Amsterdam, Diamond in Waddinxveen and the Box, formerly known as
'de Vis', in Amsterdam, the business has gone on to win a series of
high-profile contracts, which has cemented our position as one of
the leading DOOH operators in the market.
As previously announced in the second half, Ocean was awarded
the strategic media partnership contract for Westfield Mall of the
Netherlands, which has a contract value of EUR7 million. The
contract extends the Group's partnership Unibail-Rodamco-Westfield,
which now covers 24 European URW shopping malls. The partnership
sees Ocean Netherlands have the exclusive rights on media sales on
23 double sided digital screens within the mall, one large digital
outdoor screen and two large experience screens.
Other contracts secured during the period included the tender
for the large screen at the Amsterdam World Trade Centre, the media
contract covering all buses and trams in Amsterdam, which includes
over 300 vehicles and 1,688 digital screens, and the renewal of a
substantial contract with property company Kroonenberg Groep,
covering three shopping malls in Amsterdam and one mall in
Hilversum. The business has also won three roadside contracts
covering Almere and Gorinchem, extended two Amsterdam road
contracts and installed two new roadside screens in Schipol and
Nieuwegein. Other developments have included the installation of a
new digital screen in Helftheuvel Den Bosch shopping mall and the
signing of a reseller agreement with Dutch Railways, covering the
large screens within their stations.
In terms of advertising campaigns and initiatives, some of the
most high-profile have included the streaming of highlights and
live coverage of the Tour de France across Ocean Netherlands'
network of large digital screens throughout the country, and
helping 250 SMEs stay visible and connected with their audiences
with the benefit of the GBP25 million advertising support fund.
Ocean Nordics & Germany
-- Successfully accelerated integration of Visual Art and AdCity
Media and rebranded entity to Ocean Nordics
-- Won exclusive contract for 15 malls with Centrumkanalen in Sweden
-- Expanded relationship with shopping malls operator Alti, with contract for 24 malls
-- Awarded contract for 39 event areas across 16 malls in Demark
In early 2020, we accelerated the integration of Visual Art and
AdCity Media, realising a number of significant synergy gains, and
have since successfully rebranded the combined corporate entity as
Ocean Nordics. The integration process also consisted of delivering
new sales training, product structure, brand & culture, market
analysis and a new salary model, and the expanded Nordics business
is now offering digital advertising products across all its
territories.
In Q4 2020, the subsidiary ACM Retail Tech was rebranded to
Ocean MediaTech, which is part of Ocean's ongoing programme to
integrate AdCityMedia's assets with existing operations. The new
division delivers multiple Group-wide benefits, including economies
of scale, allowing the business to become more competitive through
an expanded portfolio, closer integration with Ocean media sales,
combined talent and deeper market coverage. Ocean MediaTech is also
aiming to drive greater synergies and opportunities for landlords,
partners and suppliers right across Ocean's DOOH portfolio in
Europe and beyond, and service a broad range of client
categories.
In terms of new contracts and organic developments, Ocean
Nordics secured a number of new shopping mall contracts across the
region, including an exclusive contract for 15 malls with
Centrumkanalen, which has expanded its mall network in Sweden to
115. Also in Sweden, Ocean Nordics launched a 900 sqm premium
banner located in Stockholm, situated within one of the highest
roadside vehicular audience locations in the country.
In Norway, Ocean Nordics expanded its relationship with shopping
malls operator Alti, with a contract for 24 malls, which includes
both small and large format digital screens, as well securing the
tender to operate 24 screens within Oslo bus station, the largest
bus terminal in the country. In Denmark, Ocean Nordics was awarded
a new contract for 39 event areas across 16 malls by shopping
centre owner Danske, as well as securing an additional two
independent malls, whilst in Finland, it was awarded contracts for
3 further malls. It is pleasing to see the Ocean brand competing
and beating its peers in these new markets for the Group.
Current trading & outlook
-- Entered 2021 a stronger like-for-like business, both operationally and financially
-- New content partnership with BT Sport to show UEFA's Champions League match clips
-- Well poised for the fight back with solid organic pipeline of new locations and contracts
There has been further positive momentum in terms of new
contracts and partnerships since the start of 2021, which only adds
to our optimism for the future. In March, the UK business signed
its first exclusive digital content deal with BT Sport, with Ocean
now broadcasting next day match clips from UEFA's Champions League
last 16 fixtures through to the Final in May 16, across screens in
seven cities including London, Birmingham, Manchester, Liverpool,
Newcastle, Edinburgh and Glasgow.
In the Netherlands, we have signed a strategic partnership with
the data insights provider Precisely, which forms part of Ocean
Netherlands' data and research strategy, with a new solution
incorporating mobile trace data to measure reach and determine the
profile of audiences. We have also just launched the first Digital
Creative Competition Amsterdam, using the UK format as the
template, which has been hugely successful in encouraging agencies
and creatives to push the boundaries of what is achievable with
out-of-home, whilst further raising Ocean's profile during the
process.
While financial guidance continues to be withheld until we have
seen an extended period of consistent trading, Ocean is certainly a
stronger like-for-like business, both operationally and financially
when compared to the start of 2020. Despite all the challenges
COVID-19 has thrown at the Group, we have managed to develop and
win a significant number of new assets and contracts across all our
territories, which will help to accelerate our growth as the
recovery gathers pace. We have also expanded our product offering
through further technology and innovation, which has strengthened
our network proposition. We have a solid organic pipeline of new
locations and contracts to align with the positive business and
consumer confidence that is emerging in the UK and will emerge over
coming months across all Ocean territories.
Tim Bleakley
Chief Executive
3 May 2021
Consolidated statement of profit or loss and other comprehensive
income
for the year ended 31 December 2020
Note Restated
2020 2019
GBP'000 GBP'000
Revenue 4 86,171 104,033
Cost of sales (63,724) (59,154)
_______ _______
Gross profit 22,447 44,879
Administrative expenses
* Other administrative expenses (55,705) (43,555)
(8,000) -
* Impairment of investment in associate
(133,600) -
* Impairment of intangible assets
2,256 -
* Fair value adjustment on contingent consideration
* Increase in expected credit loss provision 16 (1,139) (532)
_______ _______
(Loss) / profit from operations 6 (173,741) 792
Finance expense 9 (10,478) (7,505)
Finance income 9 17 518
Share of post-tax loss of equity (94) -
accounted associates
_______ _______
Loss before tax (184,296) (6,195)
Tax credit / (expense) 10 4,791 (541)
_______ _______
Loss from continuing operations (179,505) (6,736)
_______ _______
Other comprehensive income
Items which will or may be reclassified
to profit or loss:
Exchange gain / (loss) on translation
of foreign operations 1,471 (530)
_______ _______
Total comprehensive loss (178,034) (7,266)
_______ _______
Note Restated
2020 2019
GBP'000 GBP'000
Loss for the year attributable
to:
Shareholders of the parent (179,505) (6,736)
_______ _______
Total comprehensive loss attributable
to:
Shareholders of the parent (178,034) (7,266)
_______ _______
Earnings per share
Basic loss per share (pence) 23 (334.3p) (12.6p)
_______ _______
Diluted loss per share (pence) 23 (334.3p) (12.6p)
_______ _______
Consolidated statement of financial position
As at 31 December 2020
Note Restated
2020 2019
Assets GBP'000 GBP'000
Non-current assets
Property, plant and equipment
* Site assets, equipment and motor vehicles 11 42,860 47,352
* Right of use asset 12 182,471 159,176
Intangible assets 13 202,261 360,937
Investment in associate 15 5,203 13,297
_______ _______
432,795 580,762
_______ _______
Current assets
Trade and other receivables 16 39,289 55,471
Cash and cash equivalents 30,030 26,917
_______ _______
69,319 82,388
_______ _______
Total assets 502,114 663,150
_______ _______
Current liabilities
Trade and other payables 17 63,983 76,391
Lease liability 18 36,954 24,187
Tax payable 4,259 5,159
_______ _______
105,196 105,737
_______ _______
Non-current liabilities
Bank loan 17 4,949 -
Other payables 17 1,280 5,520
Lease liability 18 161,012 140,390
Deferred tax liability 19 33,677 37,469
_______ _______
Total liabilities 306,114 289,116
_______ _______
NET ASSETS 196,000 374,034
_______ _______
Equity
Founder Preferred Share Capital 22 3,909 4,561
Treasury shares 22 (2,417) (2,417)
Share Premium 22 376,898 376,246
Foreign exchange reserve 24 941 (530)
Retained deficit 24 (183,331) (3,826)
_______ _______
TOTAL EQUITY 196,000 374,034
_______ _______
The financial statements were approved by the Board of Directors
and authorised for issue on 3 May 2021
Consolidated statement of changes in equity
For the year ended 31 December 2020
Ordinary Ordinary Founder Foreign Retained
Share Treasury Share Preferred exchange earnings Total
capital shares premium Share Capital reserve / (deficit) equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance as
reported at 31
December
2019 - (2,417) 376,246 4,561 (530) (8,703) 369,157
Prior period
adjustment
(note
21) - - - - - 4,877 4,877
______ ______ ______ ______ ______ ______ ______
Balance at 01
January 2020
restated - (2,417) 376,246 4,561 (530) (3,826) 374,034
Conversion of
Founder
preferred
to ordinary
shares - - 652 (652) - - -
Comprehensive
income for the
period
Loss for the
period - - - - - (179,505) (179,505)
Other
comprehensive
income - - - - 1,471 - 1,471
______ ______ ______ ______ ______ ______ ______
Total
comprehensive
income
for the period - - - - 1,471 (179,505) (178,034)
______ ______ ______ ______ ______ ______ ______
31 December 2020 - (2,417) 376,898 3,909 941 (183,331) 196,000
______ ______ ______ ______ ______ ______ ______
Ordinary Ordinary Founder Foreign Retained
Share Treasury Share Preferred exchange earnings Total
capital shares premium Share Capital reserve / (deficit) equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 01
January 2019 - - 375,594 5,213 - 6,823 387,630
IFRS 16
restatement - - - - - (3,913) (3,913)
______ ______ ______ ______ ______ ______ ______
Balance at 01
January 2019
restated - - 375,594 5,213 - 2,910 383,717
Conversion of
Founder
preferred
to ordinary
shares - - 652 (652) - - -
Share repurchase - (2,417) - - - - (2,417)
Comprehensive
income for the
period
Loss for the
period restated
(note 21) - - - - - (6,736) (6,736)
Other
comprehensive
income - - - - (530) - (530)
______ ______ ______ ______ ______ ______ ______
Total
comprehensive
income
for the period
restated - - - - (530) (6,736) (7,266)
______ ______ ______ ______ ______ ______ ______
31 December 2019
restated - (2,417) 376,246 4,561 (530) (3,826) 374,034
Consolidated statement of cash flows
For the year ended 31 December 2020
Note Restated
2020 2019
GBP'000 GBP'000
Cash flows from operating activities
Loss for the year (179,505) (6,736)
Adjustments for:
Depreciation of property, plant and
equipment 11 9,977 6,953
Impairment of property, plant and
equipment 11 1,435 -
Depreciation on right of use asset 12 32,894 19,706
Amortisation of intangible fixed assets 13 24,768 19,753
Profit on disposal of tangible fixed
assets 6 117 (22)
Finance income 9 (17) (518)
Finance expense 9 10,478 7,505
Bank arrangement fees 43 -
Impairment loss on intangible assets 13 133,600 -
Impairment loss in associates 15 8,000 -
Fair value adjustment to contingent (2,256) -
consideration
Share of loss of associated companies 94 -
Rent concessions (8,306) -
_______ _______
31,322 46,641
Decrease / (increase) in trade and
other receivables 16,182 (6,651)
(Decrease) / increase in trade and
other payables (15,356) 6,761
_______ _______
Cash generated from operations 32,148 46,751
Income taxes paid (2,688) (2,369)
_______ _______
Net cash flows from operating activities 29,460 44,382
_______ _______
Investing activities
Acquisition of subsidiaries, net of
cash acquired - (125,999)
Investment in associate - (13,297)
Contingent consideration settlement (395) -
Purchases of site assets, equipment
and motor vehicles 11 (6,378) (12,095)
Interest received 9 17 518
_______ _______
Net cash used in investing activities (6,756) (150,873)
_______ _______
Financing activities
Proceeds from borrowings 20 4,880 -
Interest paid on lease liabilities (9,641) (6,916)
Interest paid 9 (299) (38)
Share buy back - (2,417)
Principal paid on lease liabilities 18 (14,573) (17,724)
_______ _______
Net cash used in financing activities (19,633) (27,095)
_______ _______
Net decrease in cash and cash equivalents 3,071 (133,586)
Cash and cash equivalents at beginning
of year 26,917 160,503
Effect of foreign exchange rate changes 42 -
_______ _______
Cash and cash equivalents at end of
year 30,030 26,917
_______ _______
Notes forming part of the Consolidated Financial Statements
for the year ended 31 December 2020
1. General information
The Company was incorporated with limited liability under the
laws of the British Virgin Islands under the BVI Companies Act on
20 January 2017. The address of the Company's registered office is
Kingston Chambers, PO Box 173, Road Town, Tortola, British Virgin
Islands. The Ordinary Shares and Warrants were admitted for trading
on the Main Market of the London Stock Exchange on 13 March
2017.
2. Principal accounting policies
The principal accounting policies applied in these financial
statements are set out below.
2.1 Basis of preparation
These financial statements have been prepared in accordance with
International Financial Reporting Standards and International
Accounting Standards as adopted by the European Union (collectively
IFRSs) and those parts of the BVI Business Companies Act applicable
under IFRS.
The preparation of financial statements in compliance with
adopted IFRS requires the use of certain critical accounting
estimates. It also requires Group management to exercise judgment
in applying the Group's accounting policies. The areas where
significant judgments and estimates have been made in preparing the
financial statements and their effect are disclosed
in note 2.9.
The financial statements are presented in GBP.
Amounts are rounded to the nearest thousand, unless otherwise
stated.
The financial statements are prepared on the historical cost
basis with the exception of certain financial instruments which are
stated at fair value.
Accounting policies have been consistently applied throughout
the periods presented.
The Group has not early adopted any standard, interpretation or
amendment that has been issued but is not yet effective.
Non-GAAP performance measures
Billings represent the advertising spend by the advertiser,
including fees directly payable by the advertiser to their
advertising agency, exclusive of sales tax.
Billings is the standard metric used by the out of home
advertising industry body "Outsmart" to measure the market size and
industry trends. Management consider Billings to be an important
metric to assess the performance of the underlying business against
industry trends and therefore presents Billings as a Non-GAAP
performance measure. Billings is presented for the benefit for
users of the accounts but is not a substitute for other standard
GAAP measures presented.
2.2 Going concern
The Directors have, at the time of approving the financial
statements, a reasonable expectation that the Company has adequate
resources to continue in operational existence for the foreseeable
future.
The Directors have considered the Group's current financial
position, a review of its budgets and forecasts, the principal
risks and uncertainties including the impact of COVID-19 and loan
facilities available to the Group, with it having secured credit
facilities providing financing of up to GBP35m, subject to
customary covenants related to minimum quarterly adjusted EBITDA
and cash balances. GBP5m of this facility has been drawn down at
year end. No breaches of the debt covenants are expected.
The audit committee continuously review forecasts and outlook,
and as part of that consider the going concern basis of preparation
of the accounts. The committee reviews the various downside
scenarios and applies its judgement in assessing the relevant
assumptions used by management and challenges where necessary.
The key assumptions that were stress tested for the going
concern scenarios were quarterly revenue declines. These were
applied to the most recent forecast for FY21 which included the
impact of lockdown restrictions across all our markets. This was
stress tested by extending the impact of these restrictions by a
whole quarter. We then applied haircuts to quarterly revenue to
assess headroom before a covenant breach. The gap between the
forecast and the covenant breach level was deemed sufficient to
maintain the going concern basis.
The group is subject to two debt covenants: last three months
EBITDA covenant and minimum liquidity covenant. These were reduced
significantly in Q1 2021 with our banks and the above assessments
of revenue decline were tested against these new covenants.
Furthermore, the term of the debt facility was extended by 12
months, providing additional comfort on the Group's operational
liquidity.
On 11 March 2020, the World Health Organisation announced the
pandemic status of COVID-19. Subsequent to this announcement,
significant measures have been taken by Governments across Europe,
restricting the movement of the people and the forced closure of
non-essential business. Given the company operates in the DOOH
market, this has impacted the company's performance in FY20. The
effect COVID-19 will have on the global economy and the knock-on
effect that it has on the long term on consumer and business
behaviour cannot yet be quantified. However, the impact on the
Group in FY20 has led to a decrease in revenue of 17% from
GBP104,033k to GBP86,171k on FY19 (and on a proforma basis a
decrease of 38% from GBP139,594k to GBP86,171k).
Following the decline in sales as a result of the pandemic, the
Group addressed its cost base as a matter of urgency in order to
reduce cash outflows from the business. Staff costs were reduced
through a structured reduction in working hours and government
reimbursement schemes were utilised where strictly necessary. These
secured GBP1.6m of grants towards employee costs. All landlords
were contacted with a view to negotiating rent holidays, deferrals
and reductions wherever possible. Rent concessions of GBP8.3m were
secured during the year. Capital expenditure has been limited and
the site maintenance program has been reduced to the performance of
only essential maintenance. Credit terms were optimised and
extensions agreed with key suppliers. Cash inflows have been aided
with sales teams chasing up any unpaid balances and ensuring any
invoice queries are resolved ensuring that debtors continue to be
settled in a timely fashion.
The Directors of the company recognise COVID-19 has had and will
have a significant effect on the results of the business in FY21,
Various scenarios assessing the impact of different sales levels
including growth rates over the next 12 months from the date of
approval of the financial statements and beyond, have been
modelled, including additional downside stress testing, in line
with the FRC guidance issued on 26th March 2020, and what the
subsequent implications would be on the Group cash flow.
The modelling demonstrates that, given the existing level of
cash held by the Group of GBP22.1m at 19 April 2021, in conjunction
with the credit facilities secured in the year providing additional
finance, with an extension of the debt facility and renegotiation
of debt covenants agreed subsequent to the year end, and the
mitigating actions available to the directors, being the option to
reduce certain costs and cash outflows as follows;
- Staff costs could be reduced through a structured reduction in
working hours and government reimbursement schemes could be
utilised
- Further staff restructuring programmes could be entered into
- Variable overheads could be reduced as much as possible, with
the operation of a zero budget policy
- Travel, subsistence and entertainment could be suspended
- All landlords have been contacted with a view to negotiating
rent holidays, deferrals and reductions wherever possible
- Capital expenditure has been frozen on all new projects where
completion is not imminent, and the site maintenance program has
been reduced to the performance of only essential maintenance
- Credit terms have been optimised and extensions agreed with key suppliers
The models prepared by management, demonstrate that even in the
prudent downside conditions considered reasonably possible, the
Group will continue to be able to meet its obligations as they fall
due and will remain compliant with its debt covenants.
On this basis, whilst acknowledging there is some uncertainty
regarding the future impacts of COVID-19, the Directors are
satisfied the Group remains well placed to manage its business
risks successfully. Therefore, they have a reasonable expectation
that the Group has adequate resources to continue in operational
existence for a period of 12 months from the date of approval of
the financial statements. Accordingly, the financial statements
continue to be prepared on a going concern basis.
2.3 Foreign currency translation
Functional and presentation currency
The Company is listed on the main market of the London Stock
Exchange. The performance of the Group is measured and reported to
the shareholders in GBP, which is considered the Group's main
functional currency, however its foreign subsidiaries functional
currency is their local currency. Subsidiaries within the Group
trade in Euro's, Swedish Krona, Danish Krona and Norwegian Krone.
The Directors consider GBP as the presentational currency of the
Group as this is the Group's primary economic environment, and is
thus considered to be the most appropriate.
Transactions and balances
Transactions entered into by Group entities in a currency other
than the functional currency are recorded at the rates ruling when
the transactions occur. Foreign currency monetary assets and
liabilities are translated at the rates ruling at the reporting
date. Exchange differences arising on the retranslation of
unsettled monetary assets and liabilities are recognised
immediately in profit or loss. Exchange differences arising on the
retranslation of the foreign operation are recognised in other
comprehensive income and accumulated in the foreign exchange
reserve.
On consolidation, the results of overseas operations are
translated into GBP at the average exchange rate for the year. All
assets and liabilities of overseas operations, including goodwill
arising on the acquisition of those operations, are translated at
the rate ruling at the reporting date. Exchange differences arising
on translating the opening net assets at opening rate and the
results of overseas operations at actual rate are recognised in
other comprehensive income and accumulated in the foreign exchange
reserve.
2.4 Financial assets
The Group classifies its financial assets into one of the
categories discussed below, depending on the business model and
cash flow type under which the assets are held. The Group has not
classified any of its financial assets as fair value through other
comprehensive income. The Group's accounting policy for each
category is as follows:
Amortised cost
These assets are non-derivative financial assets held under the
'hold to collect' business model and attracting cash flows that are
solely payments of principal and interest. They comprise trade and
other receivables and cash and cash equivalents. They are initially
recognised at fair value plus transaction costs that are directly
attributable to their acquisition or issue, and are subsequently
carried at amortised cost using the effective interest rate method,
less provision for impairment.
Impairment provisions for trade and other receivables are
calculated using an expected credit loss model. Under this model,
impairment provisions are recognised to reflect expected credit
losses based on a combination of historic and forward-looking
information, the amount of such a provision being the difference
between the net carrying amount and the present value of the future
expected cash flows associated with the impaired receivable. For
trade receivables, which are reported net; such provisions are
recorded in a separate allowance account with the loss being
recognised within administrative expenses in the consolidated
statement of comprehensive income. On confirmation that the trade
receivable will not be collectable, the gross carrying value of the
asset is written off against the associated provision.
Cash and cash equivalents include cash in hand, deposits held at
call with banks, other short term highly liquid investments with
maturities of three months or less.
Fair value through profit or loss
This category comprises in-the-money derivatives and
out-of-money derivatives where the time value offsets the negative
intrinsic value (see "Financial liabilities" section for
out-of-money derivatives classified as liabilities). They are
carried in the statement of financial position at fair value with
changes in fair value recognised in the consolidated statement of
comprehensive income in the finance income or expense line. Other
than derivative financial instruments which are not designated as
hedging instruments, the Group does not have any assets held for
trading nor does it voluntarily classify any financial assets as
being at fair value through profit or loss.
2.5 Financial liabilities
The Group classifies its financial liabilities into one of two
categories, depending on the purpose for which the liability was
acquired. The Group's accounting policy for each category is as
follows:
Other financial liabilities
Other financial liabilities include the following items:
- Trade payables and other short-term monetary liabilities,
which are initially recognised at fair value and subsequently
carried at amortised cost using the effective interest method
- Contingent consideration is carried in the statement of
financial position at fair value with changes in fair value
recognised in the consolidated statement of comprehensive income in
the finance income or expense line.
2.6 Share-based payments
The Founder Preferred Shares (and attached warrants) and
director options represent equity-settled share-based arrangements
under which the Company receives services as a consideration for
the additional rights attached to these equity shares, over and
above their nominal price. In addition, the Company has granted
options to the non-executive directors. The management team have
been incentivised via the issue of hurdle shares which aligns the
long-term interest of the company to deliver shareholder wealth.
The hurdle shares represent equity-settled share-based arrangements
under which the Group receives services as a consideration for
equity shares, over and above their nominal price. The fair value
of the grant of Founder Preferred Shares (and attached warrants),
and hurdle shares in excess of any purchase price received is
recognised as an expense. In addition, the Company has granted
options to the non-executive directors. The management team have
been incentivised via the issue of hurdle shares which aligns the
long-term interest of the company to deliver shareholder wealth.
The fair value of the Founder Preferred Shares (and attached
warrants), the options and the hurdle shares is determined using a
valuation model.
2.7 Segmental reporting
Operating segments are reported in a manner consistent with the
internal reporting provided to the chief operating decision-maker.
The chief operating decision-maker, who is responsible for
allocating resources and assessing performance of the operating
segments, has been identified as the Board of Directors as it is
the body that makes strategic decisions. The Board are of the
opinion the company operates in three distinct markets: The United
Kingdom, The Netherlands and The Nordics. Accordingly, the group
has been treated as three operational segments for FY20 and the
results of the group presented in the financial statements are
disaggregated accordingly. Each operational segment provides DOOH
services to their local market.
2.8 Share capital
Founder Preferred Shares, Ordinary Shares, and Warrants are
classified as equity. Incremental costs directly attributable to
the issue of new ordinary shares are shown in equity as a
deduction, net of tax, from the proceeds.
2.9 Critical accounting judgements and key sources of estimation uncertainty
The Group makes certain estimates and assumptions regarding the
future. Estimates and judgements are continually evaluated based on
historical experience and other factors, including expectations of
future events that are believed to be reasonable under the
circumstances. In the future, actual experience may differ from
these estimates and assumptions.
Estimates and assumptions
In preparing the financial statements for the year ended 31
December 2020, management and the directors made certain estimates
and judgements in the following areas:
- Impairment of goodwill and other intangible assets -
Estimation of future cash flows and determination of discount rates
(see note 14);
- Impairment of investment in associate - Estimation of future
cash flows and determination of discount rate (see note 15)
- Depreciation of property, plant and equipment - Estimation of
useful lives and residual values (see note 2.18);
- The determination of incremental borrowing rates used and
expected lease lengths in the application of IFRS 16 Leases; (see
note 18)
- The application of IFRS 9 when measuring expected credit
losses and the assessment of expected credit loss provisions
required for accounts receivable balances (see note 16);
- The valuation of contingent consideration based on the
probability of earn-out targets being satisfied for entities
acquired during the previous year (see note 2.20)
2.10 New accounting standards and interpretations
The Company applied all applicable standards and applicable
interpretations published by the EU for the year ended 31 December
2020 for the consolidated financial statements.
a) New standards, interpretations and amendments effective from 1 January 2020
New standards impacting the Group that were adopted in the
annual financial statements for the year ended 31 December 2020,
and which have given rise to changes in the Group's accounting
policies are:
- COVID-19-Related Rent Concessions (Amendments to IFRS 16); (see note 2.19)
- Definition of a Business (Amendments to IFRS 3);
- Interest Rate Benchmark Reform - IBOR 'phase 2' (Amendments to IFRS 9, IAS 39 and IFRS 7);
- IAS 1 Presentation of Financial Statements and IAS 8
Accounting Policies, Changes in Accounting Estimates and Errors
(Amendment - Disclosure Initiative - Definition of Material);
and
- Revisions to the Conceptual Framework for Financial Reporting.
Other new and amended standards and Interpretations issued by
the IASB that will apply for the first time in the next annual
financial statements are not expected to impact the Group as they
are either not relevant to the Group's activities or require
accounting which is consistent with the Group's current accounting
policies.
b) New standards, interpretations and amendments not yet effective
There are a number of standards, amendments to standards, and
interpretations which have been issued by the IASB that are
effective in future accounting periods that the group has decided
not to adopt early. The most significant of these is are as
follows, which are all effective for the period beginning 1 January
2022:
- Onerous Contracts - Cost of Fulfilling a Contract (Amendments
to IAS 37);
- Property, Plant and Equipment: Proceeds before Intended Use
(Amendments to IAS16) 16);
- Annual Improvements to IFRS Standards 2018-2020 (Amendments to
IFRS 1, IFRS 9, IFRS 16 and IAS 41); and
- References to Conceptual Framework (Amendments to IFRS 3
The Group is currently assessing the impact of these new
accounting standards and amendments.
2.11 Revenue
Substantially all of the Group's contracts with customers
contain a single performance obligation, being the provision of
advertising space, and are subject to fixed prices. Revenue is
recognised on an over time basis. This is because the customer
simultaneously receives and consumes the economic benefits provided
under the contract by the Group's performance.
Amounts invoiced in advance of the performance of the
advertising services are recognised as performance obligations and
released to revenue as the group performs the advertising space
under the contract.
Payment terms extended to customers depend on the country of
operation, the size of the booking and the credit risk posed by the
customer. Credit terms vary from up-front payment to 60 days.
Revenue represents the amounts (excluding the value added tax)
derived from the provision of advertising space to customers during
the 52-week period ended 27 December 2020 (2019: 52-week period
ended 29 December 2019) net of commissions and discounts. Revenue
is recognised on a 52-week period to reflect the period of customer
bookings, normally in 2-week blocks. The difference on this basis
to recognition of revenue for a full year is immaterial.
2.12 Basis of consolidation
Where Ocean Outdoor Limited ("the Company") has control over an
investee, it is classified as a subsidiary. The Company controls an
investee if all three of the following elements are present: power
over the investee, exposure to variable returns from the investee,
and the ability of the investor to use its power to affect those
variable returns. Control is reassessed whenever facts and
circumstances indicate that there may be a change in any of these
elements of control.
The Consolidated Financial Statements presents the results of
the Company and its subsidiaries ("the Group") as if they formed a
single entity. Intercompany transactions and balances between group
companies are therefore eliminated in full.
The Consolidated Financial Statements incorporates the results
of business combinations using the acquisition method. In the
statement of financial position, the acquiree's identifiable
assets, liabilities and contingent liabilities are initially
recognised at their fair values at the acquisition date. The
results of acquired operations are included in the consolidated
statement of comprehensive income from the date on which control is
obtained. They are derecognised from the date on which control
ceases.
Where the Group has the power to participate in (but not
control) the financial and operating policy decisions of another
entity, it is classified as an associate. Associates are initially
recognised in the consolidated statement of financial position at
cost. Subsequently associates
are accounted for using the equity method, where the Group's
share of post-acquisition profits
and losses and other comprehensive income is recognised in the
consolidated statement of profit and loss and other comprehensive
income (except for losses in excess of the Group's investment in
the associate unless there is an obligation to make good those
losses).
Profits and losses arising on transactions between the Group and
its associates are recognised
only to the extent of unrelated investors' interests in the
associate. The investor's share in the associate's profits and
losses resulting from these transactions is eliminated against the
carrying value of the associate.
2.13 Goodwill
Goodwill represents the excess of the cost of a business
combination over the total acquisition date fair value of the
identifiable assets, liabilities and contingent liabilities
acquired.
Cost comprises the fair value of assets given, liabilities
assumed and equity instruments issued, plus the amount of any
non-controlling interests in the acquiree plus, if the business
combination is achieved in stages, the fair value of the existing
equity interest in the acquiree. Direct costs of acquisition are
recognised immediately as an expense.
Goodwill is capitalised as an intangible asset with any
impairment in carrying value being charged to the statement of
comprehensive income. Where the fair value of identifiable assets,
liabilities and contingent liabilities exceed the fair value of
consideration paid, the excess is credited in full to the statement
of comprehensive income on the acquisition date.
2.14 Other intangible assets
Intangible assets are recognised on business combinations if
they are separable from the acquired entity or arise from other
contractual/legal rights. The amounts ascribed to such intangibles
are arrived at by using appropriate valuation techniques.
The Group has recognised acquired rights over advertising sites
on business combinations as intangible assets. These are amortised
over the contractual life of the advertising sites on a
straight-line basis, which are typically 5 to 15 years. The
amortisation charge is included within administrative expenses in
the consolidated statement of profit and loss.
The Group has recognised intangible asset in relation to the
Ocean brand acquired as part of the business combination. This is
amortised over 10 years on a straight-line basis. The amortisation
charge is included within administrative expenses in the
consolidated statement of profit and loss.
2.15 Impairment of non-financial assets (excluding deferred tax assets)
Impairment tests on goodwill and other intangible assets with
indefinite useful economic lives are undertaken annually at the
financial year end. Other non-financial assets are subject to
impairment tests whenever events or changes in circumstances
indicate that their carrying amount may not be recoverable. Where
the carrying value of an individual asset or cash generating units
('CGU') exceeds its recoverable amount (i.e. the higher of value in
use and fair value less costs to sell), the asset is written down
accordingly. Impairment charges are included in profit or loss,
except to the extent they reverse gains previously recognised in
other comprehensive income. An impairment loss recognised for
goodwill is not reversed.
2.16 Defined contribution schemes
Contributions to defined contribution pension schemes are
charged to the consolidated statement of comprehensive income in
the year to which they relate.
2.17 Deferred taxation
Deferred tax assets and liabilities are recognised where the
carrying amount of an asset or liability in the consolidated
statement of financial position differs from its tax base, except
for differences arising on:
- The initial recognition of goodwill
- The initial recognition of an asset or liability in a
transaction which is not a business combination and at the time of
the transaction affects neither accounting or taxable profit,
and
- Investments in subsidiaries where the Group is able to control
the timing of the reversal of the difference and it is probable
that the difference will not reverse in the near future.
Recognition of deferred tax assets is restricted to those
instances where it is probable that taxable profit will be
available against which the difference can be utilised.
The amount of the asset or liability is determined using tax
rates that have been enacted or substantively enacted by the
reporting date and are expected to apply when the deferred tax
liabilities/(assets) are settled/(recovered).
When there is uncertainty concerning the Group's filing position
regarding the tax bases of assets or liabilities, the taxability of
certain transactions or other tax-related assumptions, then
the Group:
- Considers whether uncertain tax treatments should be
considered separately, or together as a group, based on which
approach provides better predictions of the resolution;
- Determines if it is probable that the tax authorities will
accept the uncertain tax treatment; and
- If it is not probable that the uncertain tax treatment will be
accepted, measure the tax uncertainty based on the most likely
amount or expected value, depending on whichever method better
predicts the resolution of the uncertainty. This measurement is
required to be based on the assumption that each of the tax
authorities will examine amounts they have a right to examine and
have full knowledge of all related information when making those
examinations.
2.18 Property, plant and equipment
Items of property, plant and equipment are initially recognised
at cost. As well as the purchase price, cost includes directly
attributable costs.
Depreciation is provided on all items of property, plant and
equipment so as to write off their carrying value over their
expected useful economic lives according to the method of
depreciation prevailing in the relevant countries in accordance
with local regulations and economic conditions. It is provided at
the following rates:
Site assets
Site build costs - Over the length of the lease
Digital signage - 3 -10 years
Light boxes - 10 years
Assets under the course of construction are only depreciated
once ready for use.
Equipment
Fixtures and - 4 years straight line
fittings
Computer equipment - 2 years straight line
Motor vehicles - 4 years straight line
2.19 IFRS 16 "Leases"
IFRS 16 "Leases" applies to the recognition, measurement,
presentation and disclosure of leases. The Group's policy is as
follows:
- Right-of-use assets
The Group recognises right-of-use assets at the commencement
date of the lease. Right-of-use assets are measured at cost, less
any accumulated depreciation and impairment losses, and adjusted
for any remeasurement of lease liabilities. The cost of
right-of-use assets includes the amount of lease liabilities
recognised, initial direct costs incurred, and lease payments made
at or before the commencement date less any lease incentives
received. Unless the Group is reasonably certain to obtain
ownership of the leased asset at the end of the lease term, the
recognised right-of-use assets are depreciated on a straight-line
basis over the shorter of its estimated useful life and the lease
term. Right-of-use assets are subject to impairment.
- Lease liabilities
At the commencement date of the lease, the Group recognises
lease liabilities measured at the present value of lease payments
to be made over the lease term. The lease payments include fixed
payments (including in substance fixed payments) less any lease
incentives receivable, variable lease payments that depend on an
index or a rate, and amounts expected to be paid under residual
value guarantees. The lease payments also include the exercise
price of a purchase option reasonably certain to be exercised by
the Group and payments of penalties for terminating a lease, if the
lease term reflects the Group exercising the option to terminate.
The variable lease payments that do not depend on an index or a
rate are recognised as expense in the period on which the event or
condition that triggers the payment occurs.
- Recognition of right of use assets and lease liabilities on business combinations
In the case of lease assets and lease liabilities acquired in a
business combination, the Group measures the lease liability at the
present value of the remaining lease payments as if the acquired
lease were a new lease at the acquisition date. The group measures
the right-of-use asset at the same amount as the lease liability,
adjusted to reflect favourable or unfavourable terms of the lease
when compared with market terms.
In calculating the present value of lease payments, the Group
uses the incremental borrowing rate at the lease commencement date
if the interest rate implicit in the lease is not readily
determinable. After the commencement date, the lease liability is
increased to reflect the accretion of interest and reduced for the
lease payments made. In addition, the carrying amount of lease
liabilities is remeasured if there is a modification, a change in
the lease term, a change in the in-substance fixed lease payments
or a change in the assessment to purchase the underlying asset.
- Significant judgement in determining the lease term of contracts with renewal options
The Group determines the lease term as the non-cancellable term
of the lease, together with any periods covered by an option to
extend the lease if it is reasonably certain to be exercised, or
any periods covered by an option to terminate the lease if it is
reasonably certain not to be exercised. The Group applies judgement
in evaluating whether it is reasonably certain to exercise the
option to renew. That is, it considers all relevant factors that
create an economic incentive for it to exercise the renewal. In
addition, the Group assesses the probability of renewal of a lease
beyond the contractual term based on experience, and if likely,
includes this period within the lease term. After the commencement
date, the Group reassesses the lease term if there is a significant
event or change in circumstances that is within its control and
affects its ability to exercise (or not to exercise) the option to
renew (e.g., a change in business strategy).
The Group has leases that can be modified in subsequent periods
based on contractual performance. These are accounted for in the
accounting period as a lease modification. When the group
renegotiates the contractual terms of a lease with the lessor, the
accounting depends on the nature of the modification:
- If the renegotiation results in one or more additional assets being leased for an amount
commensurate with the standalone price for the additional
rights-of-use obtained, the modification is accounted for as a
separate lease in accordance with the above policy.
- In all other cases where the renegotiated terms increase the
scope of the lease (whether that is an extension to the lease term,
or one or more additional assets being leased), the lease liability
is remeasured using the discount rate applicable on the
modification date, with the right-of use asset being adjusted by
the same amount.
- If the renegotiation results in a decrease in the scope of the
lease, both the carrying amount of the lease liability and
right-of-use asset are reduced by the same proportion to reflect
the partial or full termination of the lease with any difference
recognised in profit or loss. The lease liability is then further
adjusted to ensure its carrying amount reflects the amount of the
renegotiated payments over the renegotiated term, with the modified
lease payments discounted at the rate applicable on the
modification date. The right-of-use asset is adjusted by the same
amount.
COVID-19-Related Rent Concessions (Amendments to IFRS 16)
Effective 1 June 2020, IFRS 16 was amended to provide a
practical expedient for lessees accounting for rent concessions
that arise as a direct consequence of the COVID-19 pandemic and
satisfy the following criteria:
a) The change in lease payments results in revised consideration
for the lease that is substantially the same as, or less than, the
consideration for the lease immediately preceding the change;
b) The reduction is lease payments affects only payments
originally due on or before 30 June 2021; and
c) There are is no substantive change to other terms and
conditions of the lease. Rent concessions that satisfy these
criteria may be accounted for in accordance with the practical
expedient, which means the lessee does not assess whether the rent
concession meets the definition of a lease modification. Lessees
apply other requirements in IFRS 16 in accounting for the
concession.
The Group has elected to utilise the practical expedient for all
rent concessions that meet the criteria. The practical expedient
has been applied retrospectively, meaning it has been applied to
all rent concessions that satisfy the criteria, which in the case
of the Group, occurred from March 2020 to December 2020.
Accounting for the rent concessions as lease modifications would
have resulted in the Group remeasuring the lease liability to
reflect the revised consideration using a revised discount rate,
with the effect of the change in the lease liability recorded
against the right-of-use asset. By applying the practical
expedient, the Group is not required to determine a revised
discount rate and the effect of the change in the lease liability
is reflected in profit or loss in the period in which the event or
condition that triggers the rent concession occurs.
2.20 Contingent and deferred consideration on acquisitions
The Group recognises contingent consideration payable on
satisfaction of performance targets over certain time periods,
based on the probability of the targets being achieved. At
inception, the balance is discounted using the acquisition internal
rate of return (IRR) to present value. Interest on the unwinding of
the balance is charged to the profit and loss over the period of
the performance targets. The probability of targets being achieved
is reviewed, and weighed average probability analysis undertaken
based on latest budgets and forecasts to assess the fair value of
the expected liability. Any changes in the expected liability are
posted as a fair value adjustment to the profit and loss.
For contingent consideration tied to on-going employment of
personnel, an accrual is made in the period in which the specified
targets are achieved with the cost being recognised as a cost of
employment.
The Group recognises deferred consideration at the present value
at inception. The balance payable in a future period is discounted
using a discount rate based on a lender borrowing rate at
acquisition to present value and interest on the unwinding of the
balance is charged to the profit and loss up to the point the
balance is payable.
2.21 Government grants
Government grants received for revenue expenditure are netted
against the cost incurred by the Group. Where retention of a
government grant is dependent on the Group satisfying certain
criteria, it is initially recognised as deferred income. When the
criteria for retention have been satisfied, the deferred income
balance is released to the consolidated statement of comprehensive
income.
2.22 Finance expense
Finance expense comprises interest payable on loans, the unwind
of discounted balances and interest charged on IFRS 16 lease
liabilities. The expense is recognised as a cost in the profit or
loss in the period in which it is incurred. In line with IAS 7,
cashflows in relation to finance expenses paid are recognised in
financing activities.
3. Financial instruments - Risk Management
The Group is exposed through its operations to the following
financial risks:
- Credit risk;
- Liquidity risk; and
- Foreign currency risk
In common with all other businesses, the Group is exposed to
risks that arise from its use of financial instruments. This note
describes the Group's objectives, policies and processes for
managing those risks and the methods used to measure them. Further
quantitative information in respect of these risks is presented
throughout these financial statements.
There have been no substantive changes in the Group's exposure
to financial instrument risks, its objectives, policies and
processes for managing those risks or the methods used to measure
them from previous periods unless otherwise stated in this
note.
(i) Principal financial instruments
The principal financial instruments used by the Group, from
which financial instrument risk arises, are as follows:
- Trade and other receivables
- Cash and cash equivalents
- Trade and other payables
(ii) Financial instruments by category
Financial assets
Amortised cost
2020 2019
GBP'000 GBP'000
Cash and cash equivalents 30,030 26,917
Trade receivables 33,298 54,124
_______ _______
Total financial assets 63,328 81,041
_______ _______
Financial liabilities
Amortised cost
2020 2019
GBP'000 GBP'000
Trade and other payables
- current 35,802 46,980
Other payables - non-current 839 2,956
Loans 4,949 -
_______ _______
Total financial liabilities 41,590 49,936
_______ _______
At year end, the Group has a GBP441k (2019: GBP2,564k) liability
which is measured at fair value through profit and loss. This is
presented in other payables, non-current liabilities. No current
trade of other payables balances are measured at fair value through
profit and loss (2019: GBP5,070k). These balances relate to amounts
payable on subsidiaries acquired in FY19. The movement in the
balance is due to payments made in the year and an update in
forecasted performance in acquired businesses following the impact
of COVID-19. The liability has been reduced resulting in a
GBP2,256k fair value release in the profit and loss statement.
(iii) Financial instruments not measured at fair value
Financial instruments not measured at fair value include certain
cash and cash equivalents, trade and other receivables and trade
and other payables.
Due to their short-term nature, the carrying value of cash and
cash equivalents, trade and other receivables, trade and other
payables approximates their fair value.
General objectives, policies and processes
The Board has overall responsibility for the determination of
the Group's risk management objectives and policies. The Board
receives monthly reports from the Group Financial Controller
through which it reviews the effectiveness of the processes put in
place and the appropriateness of the objectives and policies it
sets.
The overall objective of the Board is to set policies that seek
to reduce risk as far as possible without unduly affecting the
Group's competitiveness and flexibility. Further details regarding
these policies are set out below:
Credit risk
Credit risk is the risk of financial loss to the Group if a
customer or counterparty to a financial instrument fails to meet
its contractual obligations. The Group is mainly exposed to credit
risk from credit sales. It is Group policy, implemented locally, to
assess the credit risk of new customers before entering contracts.
The Group's review includes external ratings, when available, and
in some cases bank references. Purchase limits are established for
each customer. Trade receivables contain receivables due from
customers to which we may also owe volume rebates that are
contained within our trade payables and accruals. Credit risk also
arises from cash and cash equivalents and deposits with banks and
financial institutions. For banks and financial institutions, only
independently rated parties with minimum rating "A" are accepted.
In respect of the year and period ends presented, GBP18.1m (2019:
GBP20.9m) was held on current account with HSBC Bank plc, GBP6.1m
(2019: GBP1.1m) was held on current account with Barclays Bank plc,
EUR1.5m (GBP1.4m) (2019: EUR2.9m (GBP2.5m)) was held on current
account with ABN AMRO, EUR1.6m (GBP1.5m) (2019: EUR1.5m (GBP1.2m))
was held on current account with Rabobank and SEK 30.9m (GBP2.9m)
(2019: SEK14.7m (GBP1.2m)) was held on current account with
Skandinaviska Enskilda Banken.
Liquidity risk
Liquidity risk arises from the Group's management of working
capital and the finance charges and principal repayments on its
debt instruments. It is the risk that the Group will encounter
difficulty in meeting its financial obligations as they fall
due.
The Group's policy is to ensure that it will always have
sufficient cash to allow it to meet its liabilities when they
become due. To achieve this aim, it seeks to maintain cash balances
(or agreed facilities) to meet expected requirements for a period
of at least 90 days.
The Board receives rolling 12-month cash flow projections on a
monthly basis as well as information regarding cash balances. At
the end of the financial year, these projections indicated that the
Group expected to have sufficient liquid resources to meet its
obligations under all reasonably expected circumstances.
Between Between Between
Total Up to 3 and 1 and 2 and Over
3 12 2 5
months months years years 5 years
At 31 December 2020 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Lease liability 231,241 9,229 28,610 31,873 90,095 71,434
Trade and other payables 35,802 35,289 513 - - -
Accruals and deferred
income 28,033 28,033 - - - -
Other payables 1,280 - - 814 466 -
_______ _______ _______ _______ _______ _______
Between Between Between
Total Up to 3 and 1 and 2 and Over
3 12 2 5
months months years years 5 years
At 31 December 2019 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Lease liability 206,790 7,701 23,910 29,544 76,615 69,020
Trade and other payables 46,980 44,606 2,374 - - -
Accruals and deferred
income 29,412 29,412 - - - -
Other payables 10,501 - - 7,423 3,078 -
_______ _______ _______ _______ _______ _______
Currency risk
Following the acquisition of foreign subsidiaries in the prior
year, the Group is exposed to risk from movements in foreign
currency exchange rates, interest rates and market prices that
affect its assets, liabilities and anticipated future transactions.
The Group is exposed to foreign currency risk from transactions
other than functional currency. Transaction exposure arises because
affiliated companies undertake transactions in foreign currencies.
The Group does not use forward foreign exchange rate contracts to
hedge exchange rate risk. Its exposure is as follows:
USD EURO SEK GBP Total
in GBP in GBP in GBP in GBP GBP
At 31 December 2020 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Financial assets
Cash and cash equivalents 1,301 4,053 2,756 21,920 30,030
Trade receivables - 2,128 4,738 26,432 33,298
_______ _______ _______ _______ _______
Financial liabilities
Trade and other payables - 2,380 9,707 23,715 35,802
Other payables - 441 839 - 1,280
_______ _______ _______ _______ _______
USD EURO SEK GBP Total
in GBP in GBP in GBP in GBP GBP
At 31 December 2019 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Financial assets
Cash and cash equivalents 1,560 4,848 2,030 18,479 26,917
Trade receivables - 4,516 8,222 41,386 54,124
_______ _______ _______ _______ _______
Financial liabilities
Trade and other payables - 7,694 12,435 26,851 46,980
Other payables - 5,520 - - 5,520
_______ _______ _______ _______ _______
If the GBP exchange rate was to depreciate by 10% at FY20 year
end the difference in the above numbers would be as follows:
USD EURO SEK GBP Total
in GBP in GBP in GBP in GBP GBP
At 31 December 2020 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Financial assets
Cash and cash equivalents 1,431 4,458 3,032 21,920 30,841
Trade receivables - 2,341 5,212 26,432 33,958
_______ _______ _______ _______ _______
Financial liabilities
Trade and other payables - 2,618 10,678 23,715 37,011
Other payables - 485 923 - 1,408
_______ _______ _______ _______ _______
Net FX impact 130 336 (305) - 161
_______ _______ _______ _______ _______
The effect of a 10% weakening of GBP at the reporting date had a
net impact of GBP161k, all other variables held constant. The
effect of fluctuations in exchange rates on the balance sheet
balances is partially offset through a natural hedge. On the same
basis, the Group would have reported a GBP6.8m increased post-tax
loss.
Capital Disclosures
The Group's objectives when maintaining capital are:
- to safeguard the entity's ability to continue as a going
concern, so that it can continue to provide returns for
shareholders and benefits for other stakeholders, and
- to provide an adequate return to shareholders by pricing
products and services commensurately with the level of risk.
The Group sets the amount of capital it requires in proportion
to risk. The Group manages its capital structure and makes
adjustments to it in the light of changes in economic conditions.
In order to maintain or adjust the capital structure, the Group may
adjust the amount of dividends paid to shareholders, return capital
to shareholders, issue new shares, or sell assets to reduce
debt.
2020 2019
GBP'000 GBP'000
Loans and borrowings 4,949 -
IFRS 16 lease liabilities 197,966 164,577
Less: cash and cash equivalents (30,030) (26,917)
_______ _______
Net debt 172,885 137,660
_______ _______
Total equity 196,000 374,034
_______ _______
Debt to capital ratio 88% 37%
_______ _______
4. Revenue
All revenue is recognised on an over time basis from advertising
space provided to its customers.
Analysis of revenue by service type and region:
2020 2019
GBP'000 GBP'000
Provision of advertising space - United
Kingdom 39,240 71,668
Provision of advertising space - Netherlands 17,263 22,800
Provision of advertising space - Nordics 29,668 9,565
_______ _______
86,171 104,033
_______ _______
5. Segmental reporting
UK Group Netherlands Nordics Total
2020 GBP'000 GBP'000 GBP'000 GBP'000
Revenue 39,240 17,263 29,668 86,171
Interest 6,148 2,528 1,858 10,534
Depreciation, amortisation
and impairment on tangible
fixed assets 46,954 10,166 12,285 69,405
Impairment on intangibles
and investments in associates 75,000 17,200 49,400 141,600
Loss for the period (108,977) (20,283) (50,245) (179,505)
Non-current assets 311,008 62,802 58,984 432,794
Total assets 412,263 48,513 41,337 502,113
Total liabilities (183,871) (61,242) (61,000) (306,113)
_______ _______ _______ _______
UK Group Netherlands Nordics Total
Restated 2019 GBP'000 GBP'000 GBP'000 GBP'000
Revenue 71,668 22,800 9,565 104,033
Interest (5,779) (1,411) (315) (7,505)
Depreciation and amortisation
and impairment on tangible
fixed assets (37,475) (6,385) (2,552) (46,412)
(Loss) / profit for
the period (10,939) 3,365 838 (6,736)
Non-current assets 481,600 62,819 36,343 580,762
Total assets 553,392 56,283 53,475 663,150
Total liabilities (198,783) (49,007) (41,326) (289,116)
_______ _______ _______ _______
6. Expenses by nature
Restated
2020 2019
GBP'000 GBP'000
Employee benefit expenses (note 7) (restated) 15,941 10,882
Depreciation of site assets, equipment
and motor vehicles (note 11) 9,977 6,953
Impairment of site assets (note 11) 1,435 -
Depreciation of right of use asset (note
12) 32,984 19,706
Amortisation of intangible assets (note
13) 24,768 19,753
Impairment of intangible assets (note 133,600 -
14)
Impairment of investment in associate 8,000 -
Site profit share, rates, utilities
and maintenance 20,142 22,015
Rent concessions (8,306) -
Loss / (profit) on disposal of site
assets, equipment and motor vehicles 117 (22)
Foreign exchange (338) 482
Acquisition and relisting fees 3,093 1,854
Auditor remuneration - audit fees
Ocean Outdoor Limited Group audit 412 516
Auditor remuneration - other non-audit - -
services
_______ _______
7. Employee benefit expenses
Restated
2020 2019
GBP'000 GBP'000
Wages and salaries 14,473 7,604
Government grants - employee cost reimbursement (1,569) -
Deemed consideration on earn out (restated) - 2,135
Social security contributions and similar
taxes 2,269 909
Hurdle share option cost 90 90
Defined contribution pension cost 678 144
_______ _______
15,941 10,882
_______ _______
Payroll support
Included in the profit or loss are government grants obtained
relating to supporting the payroll of the Group's employees. The
Group has elected to offset the Government grants with the payroll
expense. The Group was re-imbursed for payroll expenses following
its compliance with the requirements of the applicable scheme.
8. Key management personnel compensation
Key management personnel are those persons having authority and
responsibility for planning, directing and controlling the
activities of the Group, including the directors.
2020 2019
GBP'000 GBP'000
Wages and salaries 1,071 1,941
Benefits in kind 42 67
Hurdle share option cost 90 90
Defined contribution pension cost 39 38
_______ _______
1,242 2,136
_______ _______
9. Finance expense and finance income
Restated
2020 2019
GBP'000 GBP'000
Finance expense
Interest payable on lease liability 9,641 6,915
Interest on contingent consideration 538 552
Other Interest payable 299 38
_______ _______
10,478 7,505
_______ _______
2020 2019
GBP'000 GBP'000
Finance income
Interest receivable on cash and cash
equivalents 17 518
_______ _______
10. Tax
2020 2019
GBP'000 GBP'000
Current tax expense
Current tax (credit) / charge for the
year (969) 4,250
Adjustments in respect of prior periods (924) -
_______ _______
Total current tax (1,893) 4,250
Deferred tax expense
Deferred tax credit for the year (see
note 19) (2,898) (3,709)
_______ _______
Total tax (credit) / expense (4,791) 541
_______ _______
The Group's trading subsidiaries operated in the UK, the
Netherlands and in the Nordics in FY20. The group pays corporation
tax on profits in the corresponding tax jurisdiction in which the
company operates. The reasons for the difference between the actual
tax charge for the year and the standard rate of corporation tax in
the United Kingdom applied to the loss for the year are as
follows:
2020 2019
GBP'000 GBP'000
Loss before tax (184,296) (6,195)
_______ _______
Tax using the Company's domestic tax
rate of 19%
(2019: 19%) (35,016) (1,177)
Foreign subsidiary tax rate difference 370 220
Expenses not deductible for tax purposes 998 1,498
Impairment charges not deductible 26,909 -
Income not taxable (456) -
Adjustment closing deferred tax to average 2,123 -
rate
Adjustments to tax charge in respect (943) -
of previous periods
Losses carried back 932 -
Deferred tax not recognised 292 -
_______ _______
Total tax (credit) / expense (4,791) 541
_______ _______
Expenses not deductible for tax purposes
The key contributor to the expenses not deductible for tax
purposes is interest disallowable per the corporate interest
restrictions rules.
Changes in tax rates and factors affecting the future tax
charge
On 11 March 2020, the UK corporation tax rate was confirmed as
being maintained at 19% from 1 April 2020 onwards. Deferred tax
assets and liabilities at 31 December 2020 have been calculated
taking into consideration the applicable rates when the temporary
differences are expected to reverse. On 3 March 2021 it was
announced the UK corporation tax rate is to increase to 25% from 1
April 2023. This may have a material effect on deferred tax once
the new tax rate is substantively enacted.
11. Property, plant and equipment
Site Motor
assets Equipment vehicles Total
GBP'000 GBP'000 GBP'000 GBP'000
Cost or valuation
At 1 January 2019 34,787 211 61 35,059
Acquired through business
combinations 9,630 579 117 10,326
Additions 11,922 278 - 12,200
Disposals (91) - (13) (104)
FX variance (250) (3) (1) (254)
_______ _______ _______ _______
At 31 December 2019 55,998 1,065 164 57,227
_______ _______ _______ _______
At 1 January 2020 55,998 1,065 164 57,227
Additions 5,268 1,078 32 6,378
Disposals (1,749) (364) (41) (2,154)
FX variance 964 240 6 1,210
_______ _______ _______ _______
At 31 December 2020 60,481 2,019 161 62,661
_______ _______ _______ _______
Accumulated depreciation
At 1 January 2019 3,088 (13) 13 3,088
Charge in the year 6,737 161 55 6,953
Disposals (121) - (4) (125)
FX variance (40) (1) - (41)
_______ _______ _______ _______
At 31 December 2019 9,664 147 64 9,875
_______ _______ _______ _______
At 1 January 2020 9,664 147 64 9,875
Charge in the year 9,397 538 42 9,977
Impairment 1,435 - - 1,435
Disposals (1,629) (295) (23) (1,947)
FX variance 254 206 1 461
_______ _______ _______ _______
At 31 December 2020 19,121 596 84 19,801
_______ _______ _______ _______
Net Book Value
At 31 December 2020 41,360 1,423 77 42,860
_______ _______ _______ _______
At 31 December 2019 46,334 918 100 47,352
_______ _______ _______ _______
Included within site assets is GBP0.5m (2019: GBP3.95m) related
to assets under course of construction.
There were indicators of impairment on a single location and
therefore management have made the decision to process a charge to
write down the asset, included above.
12. Right of use asset
Right of
use asset
Cost GBP'000
At 1 January 2019 144,530
Additions 73,580
Effect of modification to lease terms 11,463
Disposals (1,429)
FX variance (1,214)
_______
At 31 December 2019 226,930
_______
As reported at 31 December 2019 216,384
Prior period adjustment (note
21) 10,546
_______
As restated at 1 January 2020 226,930
Additions 41,621
Effect of modification to lease
terms 12,688
Disposals (5,707)
FX variance 4,885
_______
At 31 December 2020 280,417
_______
Accumulated depreciation
At 1 January 2019 48,788
Charge in the year 19,706
Disposals (613)
FX variance (127)
_______
At 31 December 2019 67,754
_______
At 1 January 2020 67,754
Charge in the year 32,894
Disposals (3,452)
FX variance 750
_______
At 31 December 2020 97,946
_______
Right
of use
asset
Net Book Value GBP'000
At 31 December 2020 182,471
_______
At 31 December 2019 159,176
_______
The right of use asset arises from the group entering into
leases to secure advertising site assets.
13. Intangible assets
Brand Acquired Goodwill Total
rights
over advertising
sites
GBP'000 GBP'000 GBP'000 GBP'000
Cost or valuation
At 1 January 2019 6,725 136,715 96,671 240,111
Acquired through business
combinations - 74,167 77,315 151,482
FX variance - (264) (552) (816)
_______ _______ _______ _______
At 31 December 2019 6,725 210,618 173,434 390,777
_______ _______ _______ _______
As reported at 31 December
2019 6,725 210,618 179,904 397,247
Prior period adjustment
(note 21) - - (6,470) (6,470)
_______ _______ _______ _______
As restated at 1 January
2020 6,725 210,618 173,434 390,777
FX variance - (166) (142) (308)
_______ _______ _______ _______
At 31 December 2020 6,725 210,452 173,292 390,469
_______ _______ _______ _______
Accumulated amortisation
and impairment
At 1 January 2019 500 9,587 - 10,087
Charge in the year 673 19,080 - 19,753
_______ _______ _______ _______
At 31 December 2019 1,173 28,667 - 29,840
_______ _______ _______ _______
Brand Acquired Goodwill Total
rights
over advertising
sites
Accumulated amortisation GBP'000 GBP'000 GBP'000 GBP'000
and impairment
At 1 January 2020 1,173 28,667 - 29,840
Charge in the year 673 24,095 - 24,768
Impairment losses - 150 133,450 133,600
_______ _______ _______ _______
At 31 December 2020 1,846 52,912 133,450 188,208
_______ _______ _______ _______
Net Book Value
At 31 December 2020 4,879 157,540 39,842 202,261
_______ _______ _______ _______
At 31 December 2019 5,552 181,951 173,434 360,937
_______ _______ _______ _______
The period over which amortisation is charged on acquired rights
over advertising sites is between 4 and 15 years. The period over
which amortisation is charged on the Ocean brand is 10 years.
14. Goodwill and impairment
The Group is required to test, on an annual basis, whether
goodwill has suffered any impairment. The recoverable amount is
determined based on value in use calculations. The use of this
method requires the estimation of future cash flows and the
determination of a discount rate in order to calculate the present
value of the cash flows.
The Company made five acquisitions in FY19 - three acquisitions
in the Netherlands and two acquisitions in the Nordics. It made two
acquisitions in FY18 in the UK. The Group has three CGU's and for
the purpose of impairment testing each CGU was measured on the
basis of its value in use based on financial forecasts covering a
five-year period. The key assumptions for the value in use
calculation are:
- Discount rates
- Growth rates in revenue and costs
- Free cash flow
The free cash flows used are based on revenue projections less
direct and allocated costs established using management approved
budgets and forecasts less working capital movements.
The key assumption used in the models for each CGU were as
follows:
UK NL Nordics
GBP'000 GBP'000 GBP'000
Basis of recoverable amount Value in Value in Value in
determined Use Use Use
Key assumptions:
Revenue growth 17.4% 9.6% 15.8%
Cost growth 5.2% 3.8% 7.9%
Forecast period 5 years 5 years 5 years
Growth rate beyond forecast
period 2.0% 2.0% 2.0%
Pre-tax discount rate for
forecast period 9.5% 9.0% 11.4%
Revenue growth equals the compound annual growth rate over the
5-year period of the model. Following an update to the CGU models
using the latest market data available, taking into account the
impact COVID-19 has had on the business and the market as a whole,
the Group has recognised an impairment of GBP133.6m on intangible
assets of the business to ensure the CGU's value in use did not
exceed their carrying value. This impairment charge arises due to
reductions in budgeted revenue in each CGU. The UK impairment
charge of GBP67.0m has been allocated against goodwill. The Nordics
impairment charge of GBP49.4m has also been allocated against
goodwill. The NL impairment charge of GBP17.05m has been allocated
against the entirety of the NL goodwill balance with a further
GBP0.15m allocated against acquired rights over advertising
sites.
The carrying amount of goodwill is allocated to the cash
generating units (CGUs) as follows:
2020 2019
GBP'000 GBP'000
Ocean UK 29,671 96,671
Ocean Netherlands - 17,050
Ocean Nordics 10,171 59,713
_______ _______
39,842 173,434
_______ _______
The assumptions used are based on past performance and
expectations of future changes in the market. They have been
assessed and consideration given to any reasonable possible changes
to these assumptions, including the undertaking of a sensitivity
analysis. Had assumptions used in the models have been more
conservative, additional impairment of intangible assets would have
been recognised in each CGU as follows:
UK UK UK
GBP'000 GBP'000 GBP'000
Total additional
Goodwill Other intangibles impairment
Pre-tax discount rate increased
by 10% 29,671 1,329 31,000
10% decrease in Revenue
growth rates over FY21 to
FY25 29,671 59,329 89,000
Decrease in long term growth
rate to 1% 29,671 2,329 32,000
The key assumption used in the models for each CGU were as
follows:
UK NL Nordics
GBP'000 GBP'000 GBP'000
Basis of recoverable amount Value in Value in Value in
determined Use Use Use
Key assumptions:
Revenue growth 17.4% 9.6% 15.8%
Cost growth 5.2% 3.8% 7.9%
Forecast period 5 years 5 years 5 years
Growth rate beyond forecast
period 2.0% 2.0% 2.0%
Pre-tax discount rate for
forecast period 9.5% 9.0% 11.4%
Revenue growth equals the compound annual growth rate over the
5-year period of the model. Following an update to the CGU models
using the latest market data available, taking into account the
impact COVID-19 has had on the business and the market as a whole,
the Group has recognised an impairment of GBP133.6m on intangible
assets of the business to ensure the CGU's value in use did not
exceed their carrying value. This impairment charge arises due to
reductions in budgeted revenue in each CGU. The UK impairment
charge of GBP67.0m has been allocated against goodwill. The Nordics
impairment charge of GBP49.4m has also been allocated against
goodwill. The NL impairment charge of GBP17.05m has been allocated
against the entirety of the NL goodwill balance with a further
GBP0.15m allocated against acquired rights over advertising
sites.
The carrying amount of goodwill is allocated to the cash
generating units (CGUs) as follows:
2020 2019
GBP'000 GBP'000
Ocean UK 29,671 96,671
Ocean Netherlands - 17,050
Ocean Nordics 10,171 59,713
_______ _______
39,842 173,434
_______ _______
The assumptions used are based on past performance and
expectations of future changes in the market. They have been
assessed and consideration given to any reasonable possible changes
to these assumptions, including the undertaking of a sensitivity
analysis. Had assumptions used in the models have been more
conservative, additional impairment of intangible assets would have
been recognised in each CGU as follows:
UK UK UK
GBP'000 GBP'000 GBP'000
Total additional
Goodwill Other intangibles impairment
Pre-tax discount rate increased
by 10% 29,671 1,329 31,000
10% decrease in Revenue
growth rates over FY21 to
FY25 29,671 59,329 89,000
Decrease in long term growth
rate to 1% 29,671 2,329 32,000
NL NL NL
GBP'000 GBP'000 GBP'000
Total additional
Goodwill Other intangibles impairment
Pre-tax discount rate increased
by 10% - 9,270 9,270
10% decrease in Revenue
growth rates over FY21 to
FY25 - 4,520 4,520
Decrease in long term growth
rate to 1% - 10,660 10,660
Nordics Nordics Nordics
GBP'000 GBP'000 GBP'000
Total additional
Goodwill Other intangibles impairment
Pre-tax discount rate increased
by 10% 10,171 1,429 11,600
10% decrease in Revenue
growth rates over FY21 to
FY25 10,171 19,129 29,300
Decrease in long term growth
rate to 1% 10,171 29 10,200
15. Subsidiaries, investments and business combinations
On 26 February 2018, Ocean Outdoor Limited formed Ocean Jersey
Topco Limited (formerly Ocelot Partners Bidco Limited), a wholly
owned subsidiary, incorporated in Jersey.
On 28 March 2018 the Ocean Outdoor Limited acquired 100% of the
share capital and voting rights of SCP Acquisition Topco Limited
and its subsidiaries, through Ocean Jersey Topco Limited. T he
acquired company and its subsidiaries specialise in the development
and sale of Out of Home (OOH) displays in the UK. The transaction
was funded using cash on hand.
On 2 June 2018 the Ocean Group acquired 100% of the share
capital and voting rights of Forrest Media (Holdings) Limited and
its subsidiaries, registered in Scotland, through Ocean Bidco
Limited. T he acquired company and its subsidiaries specialise in
the development and sale of Out of Home (OOH) displays in Scotland.
The transaction was funded using cash on hand.
On 11 March 2019 the Ocean Group acquired 100% of the share
capital and voting rights of Ngage Media B.V, registered in the
Netherlands, through Ocean Bidco Limited. The acquired company
specialises in the development and sale of Out of Home (OOH)
displays in the Netherlands. The transaction was funded using cash
on hand.
On 11 March 2019 the Ocean Group acquired 100% of the share
capital and voting rights of Ocean Outdoor Nederland B.V,
registered in the Netherlands, through Ocean Bidco Limited. T he
acquired company specialises in the development and sale of Out of
Home (OOH) displays in the Netherlands. The transaction was funded
using cash on hand.
On 29 May 2019 the Ocean Group acquired 100% of the share
capital and voting rights of DKTD Media B.V , (aka Beyond Outdoor)
registered in the Netherlands, through Ocean Bidco Limited. T he
acquired company specialises in the development and sale of Out of
Home (OOH) displays in the Netherlands. The transaction was funded
using cash on hand.
On 13 September 2019 the Ocean Group acquired 100% of the share
capital and voting rights of Ocean Outdoor Nordics VA Holding AB
and its subsidiaries, registered in Sweden, through Ocean Bidco
Limited. T he acquired company and its subsidiaries specialise in
the development and sale of Out of Home (OOH) displays in Sweden,
Denmark, Finland and Germany. The transaction was funded using cash
on hand. The acquired Group consisted of a Media Sales business and
a Digital signage business. It was always the intention of Ocean to
acquire 100% of the Media Sales business and to form a separate
entity with the vendors for the Digital Signage business.
Accordingly, the digital signage business was recognised as a
subsidiary held-for-sale at the acquisition date and the media
sales business was recognised as a business combination. The
acquired group was restructured following the acquisition resulting
in Ocean Bidco Limited holding 49.99% of the share capital and
voting rights of Visual Art Technologies (the Digital signage
business), a company registered in Sweden. The restructure was
formalised on 23 December 2019 at which point Visual Art
Technologies was de-recognised as a subsidiary and was subsequently
recognised as an associate in accordance with IAS 28. The Group
does not exercise control over Visual Art Technologies with effect
from 23 December 2019 because another party holds the remaining
share capital and voting rights. The fair value of the associate at
23 December 2019 and 31 December 2019 was GBP13.3m. The carrying
value of the investments at 31 December 2020 was GBP5.3m following
an impairment loss recognised in the year of GBP8.0m.
On 9 December 2019 the Ocean Group acquired 80.13% of the share
capital and voting rights of AdCityMedia AB and its subsidiaries,
registered in Sweden, through Ocean Bidco Limited. On 18 December
2019 a further 17.33% of the share capital and voting rights were
acquired taking the total holding to 97.46%. T he acquired company
and its subsidiaries specialise in the development and sale of Out
of Home (OOH) displays in Sweden and Norway. The transaction was
funded using cash on hand. On 4 February 2020 a further 1.94%
holding in the company was acquired. As at 31 December 2020, the
Group owned 99.41% of AdCityMedia AB and its subsidiaries. Under
Swedish law the remaining shares not owned can be acquired via a
compulsory purchase.
The principal subsidiaries and associates of the Group which
have been included in these Consolidated Financial Statements, are
as follows:
Name Country of Nature of business Ownership Ownership
incorporation 2020 2019
and principal
place of business
Subsidiary companies
Ocean Jersey Topco Limited Jersey Holding co. 100% 100%
SCP Acquisition Bidco Limited
(1) England & Wales Holding co. 100% 100%
Ocean Bidco Limited (1) England & Wales Holding co. 100% 100%
Ocean Outdoor UK Limited England &
(1) Wales OOH Media Owner 100% 100%
Signature Outdoor Limited England &
(1) Wales OOH Media Owner 100% 100%
Mediaco Outdoor Limited England &
(1) Wales OOH Media Owner 100% 100%
Forrest Outdoor Media Limited
(1) Scotland OOH Media Owner 100% 100%
Ocean Brands Limited (1) Scotland Dormant subsidiary 68% 68%
Ngage Media B.V (1) Netherlands OOH Media Owner 100% 100%
Ocean Outdoor Nederland
B.V (1,2) Netherlands OOH Media Owner 100% 100%
DKTD Media B.V (1) Netherlands OOH Media Owner 100% 100%
Ocean Outdoor Nordics AB
(1) Sweden Holding co. 100% 100%
Ocean Outdoor Sweden AB
(1) Sweden Holding co. 100% 100%
Global Agencies Stockholm
AB (1) Sweden OOH Media Owner 100% 100%
Ocean Outdoor Denmark A/S
(1) Denmark OOH Media Owner 100% 100%
Ocean Outdoor Finland Oy
(1) Finland OOH Media Owner 100% 100%
Gudfar & Son AB (1) Sweden OOH Media Owner 100% 100%
Ocean Outdoor Germany GmbH
(1) Germany OOH Media Owner 100% 100%
AdCityMedia AB (1) Sweden OOH Media Owner 99.41% 97.46%
GM-Gruppen Moving Message
AB (1) Sweden OOH Media Owner 99.41% 97.46%
Ocean Outdoor Norway A/S
(1) Norway OOH Media Owner 99.41% 97.46%
All in Media Sverige AB
(1) Sweden OOH Media Owner 99.41% 97.46%
ACM AB (1) Sweden OOH Media Owner 99.41% 97.46%
Associate companies
Digital signage
Visual Art Sweden AB Sweden co. 49.99% 49.99%
Visual Art International
Holding AB Sweden Holding co. 49.99% 49.99%
Digital signage
Visual Art Germany GmbH Germany co. 49.99% 47.49%
Digital signage
Visual Art USA Inc. USA co. 49.99% 49.99%
Digital signage
Visual Art Norway AS Norway co. 49.99% 49.99%
Visual Art Finland Oy Finland Digital signage 49.99% -
co.
Visual Art Denmark Aps Norway Digital signage 49.99% -
co.
(1) The shares held in these entities are held indirectly.
(2) Formerly called Interbest B.V
The registered address for Ocean Jersey Topco Limited is 3rd
Floor, 44 Esplanade, St Helier, Jersey, JE4 9WG.
The registered address for entities incorporated in England
& Wales is 25 Argyll Street, London, W1F 7TU, United
Kingdom.
The registered address for entities incorporated in Scotland is
7 Seaward Street, Paisley Road, Glasgow, G41 1HJ, United
Kingdom.
The registered address for Ocean Outdoor Nederland B.V and DKTD
Media B.V is Kastanjelaan 400 Verdieping 4, 5616LZ, Eindhoven,
Netherlands.
The registered address for Ngage Media B.V. is Locatellikade 1,
1076AZ, Amsterdam, Netherlands.
The registered address for Ocean Outdoor Nordics AB, Ocean
Outdoor Sweden AB, Global Agencies Stockholm AB, Visual Art Sweden
AB, Visual Art International Holding AB and Gudfar & Son AB is
Hälsingegatan 45, 113 31 Stockholm, Sweden.
The registered address for Ocean Outdoor Germany GmbH and Visual
Art Germany GmbH is Winterstraße 2, 22765 Hamburg, Germany.
The registered address for Visual Art USA Inc is 20 West Kinzie
Street, 17th floor Chicago, IL 60654, USA.
The registered address for Ocean Outdoor Denmark A/S is Gammel
Mønt 2, 1. sal 1117 København K, Denmark.
The registered address for Ocean Outdoor Finland Oy is
Pursimiehenkatu 29-31 E 00150 Helsinki, Finland.
The registered address for AdCityMedia AB and ACM AB is
Frihamnsgatan 22, Magasin 3, 115 56 Stockholm.
The registered address for GM-Gruppen Moving Message AB is
Strömslundsgatan 4, 507 62 Borås, Sweden.
The registered address for All in Media Sverige AB is
Kopparbergsvägen 27, 722 13 Västerås, Sweden.
The registered address for Visual Art Norway AS and Ocean
Outdoor Norway A/S is Martin Linges Vei 25 1364 Fornebu,
Norway.
The registered address for Visual Art Denmark ApS is Gammel Mont
2 1, 1117 København, Denmark.
The registered address for Visual Art Finland OY is Äyritie 8 D,
01510 Vantaa, Finland.
Ngage Media B.V prior period adjustment
Subsequent to the acquisition of Ngage Media B.V, the Directors
became aware of an error being presented in the financial
statements. Following the identification of a clause in relation to
the contingent consideration, the payment of the contingent
consideration was not only conditional on the satisfaction of
performance targets, the basis upon which it was previously
treated, but also on the condition of continued employment of
certain personnel within the business. In line with IFRS 3, the
acquisition accounting has been corrected. This contingent
consideration should be treated as an employee remuneration expense
in the period in which performance targets have been satisfied. The
discounted contingent consideration previously recognised, has been
removed resulting in a GBP6.5m reduction in the goodwill previously
reported. The recalculated fair value of the assets and liabilities
acquired and consideration are:
Fair value
Fair value of assets at 11 March 2019 GBP'000
Intangible fixed assets 12,130
Tangible fixed assets 2,233
Right of use asset 4,222
Debtors 1,331
Cash and cash equivalents 1,177
Creditors (2,906)
Lease liability (4,222)
Deferred tax liability (2,863)
________
Net assets acquired 11,102
________
Purchase consideration: Deemed consideration Consideration
Total GBP'000 per IFRS
GBP'000 3
GBP'000
Cash 8,815 - 8,815
Deferred consideration
paid 2,596 - 2,596
Contingent consideration 6,470 (6,470) -
________ ________ ________
Total purchase consideration 17,881 (6,470) 11,411
________ ________ ________
Goodwill arising on
acquisition 309
________
The net cash outflow of the acquisition was unaffected. See note
21 for the impact on the reported results.
Goodwill arising on acquisition relates to a number of factors.
Group synergies are expected to be achieved and the Group will
benefit from economies of scale. Preferential supplier terms can be
negotiated and bringing these companies under the Ocean brand will
create additional value as the Group establishes itself as a major
DOOH player across Northern Europe.
Investment in associate
Visual Art Sweden AB and subsidiaries became an associate
investment with effect from 23 December 2019. The cost of
investment and the latest available unaudited financial information
for that Group as at 31 Dec 2020 is as follows:
Visual Art Sweden AB and subsidiaries 2020 2019
GBP'000 GBP'000
Cost 13,297 13,297
Share of loss (94) -
Impairment (8,000) -
_______ _______
5,203 13,297
_______ _______
Management performed an impairment review over the associate to
determine if it had suffered any impairment at 31 December 2020.
The recoverable amount of the associate was determined using a
discounted cash flow (DCF) model over a period of 5 years together
with a terminal value calculation which was adjusted by Ocean's
equity ownership percentage and a discount for a non-controlling
interest. The use of this methodology requires the estimation of
future cash flows and the determination of a discount rate in order
to calculate the present value of the cash flows.
The key assumptions included in the DCF calculations are:
- Discount rates
- Growth rates in revenue and costs
- Free cash flow
The free cash flows used are based on revenue projections less
direct and allocated costs established using management approved
budgets and forecasts less working capital movements.
The key assumption used in the models for each CGU were as
follows:
Key assumptions:
Revenue growth 16.3%
Cost growth 13.3%
Forecast period 5 years
Growth rate beyond forecast period 2.0%
Pre-tax discount rate for forecast period 22.46%
The impairment arises within the investment in associate
following a loss suffered in the year with budgeted revenues
decreasing as a result of COVID-19. Using the latest value in use
methodology, based on the above key assumptions, an GBP8.0m
impairment has been recognised.
Sensitivity analysis was undertaken with the results as
follows:
GBP'000
Total additional
impairment
Post-tax discount rate increased by 10% 737
10% decrease in Revenue growth rates over FY21
to FY25 2,787
Decrease in long term growth rate to 1% 291
Visual Art Sweden AB and subsidiaries unaudited 2020 2019
financial information
GBP'000 GBP'000
Non-current assets 840 975
Current assets 4,378 4,324
Current liabilities (3,721) (4,725)
Revenue 17,482 -
Profit for the year 76 -
_______ _______
16. Trade and other receivables
2020 2019
GBP'000 GBP'000
Trade receivables 33,298 54,124
Prepayments and other receivables 5,991 1,347
_______ _______
Total trade and other receivables - Current 39,289 55,471
_______ _______
The carrying value of trade and other receivables classified as
financial assets at amortised cost approximates fair value. The
Group does not hold any collateral as security.
The Group applies the IFRS 9 simplified approach to measuring
expected credit losses using a lifetime expected credit loss
provision for trade receivables and contract assets. To measure
expected credit losses on a collective basis, trade receivables and
contract assets are grouped based on similar credit risk and aging.
The contract assets have similar risk characteristics to the trade
receivables for similar types of contracts.
The expected loss rates are based on the Group's historical
credit losses experienced over the
three-year period prior to the period end. The historical loss
rates are then adjusted for current
and forward-looking information on macroeconomic factors
affecting the Group's customers.
The Group has identified the gross domestic product (GDP),
unemployment rate and inflation
rate as the key macroeconomic factors in the countries where the
Group operates.
2020 2019
GBP'000 GBP'000
Opening provision for impairment of trade
receivables 778 246
Increase during the year 1,139 532
_______ _______
Closing estimated credit loss provision 1,917 778
_______ _______
The year-on-year increase in the expected credit loss provision
is as a result of the increased credit risk following the impact
COVID-19 has had on the economy. This has resulted in higher
default rates being applied to debtor balances.
Estimated Gross carrying Credit loss
Default amount allowance
31 December 2020 rate GBP'000 GBP'000
Current 1.00% 12,011 120
Up to 3 months past due 2.00% 13,034 261
More than 3 months past due 15.10% 10,170 1,536
_______ _______
35,215 1,917
_______ _______
Estimated Gross carrying Credit loss
Default amount allowance
31 December 2019 rate GBP'000 GBP'000
Current 0.50% 29,138 146
Up to 3 months past due 1.00% 15,040 151
More than 3 months past due 4.80% 9,946 481
_______ _______
54,124 778
_______ _______
17. Trade and other payables
Restated
2020 2019
Due within one year: GBP'000 GBP'000
Trade payables 23,978 33,854
Other payables 11,824 8,056
Contingent consideration - 5,070
Accrued consideration 148 627
Deferred income 2,100 7,699
Accruals 25,933 21,085
_______ _______
63,983 76,391
_______ _______
Restated
2020 2019
Due after more than one year: GBP'000 GBP'000
Bank loan 4,949 -
Other payables 839 2,956
Contingent consideration 441 2,564
_______ _______
6,229 5,520
_______ _______
The accruals balance contains accruals for site rates, profit
shares and volume rebates, including estimates for such items where
necessary.
18. Leases
Restated
2020 2019
GBP'000 GBP'000
As at 1 January 164,577 99,719
Additions:
Lease additions 42,465 14,384
Lease modification 12,688 1,259
Subsidiary acquisition - 69,400
Disposals (2,382) (766)
Finance expense 9,641 6,916
Concessions (8,306) -
Foreign exchange difference 3,497 (1,695)
Payments (24,214) (24,640)
________ ________
As at 31 December 197,966 164,577
________ ________
Current 36,954 24,187
Non-current 161,012 140,390
________ ________
197,966 164,577
________ ________
The Group entered into a number of new site lease contracts in
the year resulting in an increase in the lease liability. Lease
modifications were recognised in the year reflecting change in
lease terms following negotiations with landlords. The Group has
received rent concessions from lessors due to the Group being
impacted by COVID-19, including rent forgiveness and rent
deferrals. Lease disposals relate to the termination of lease
contracts.
19. Deferred tax
Deferred tax assets and liabilities at 31 December 2019 have
been calculated taking into consideration the applicable rates when
the temporary differences are expected to reverse. On 11 March
2020, the UK corporation tax rate was confirmed as being maintained
at 19% from 1 April 2020 onwards. This resulted in the UK deferred
tax balances being assessed at 19% (2019: 17%).
Details of the deferred tax liability, amounts recognised in
profit or loss and amounts recognised in other comprehensive income
are as follows:
Charged/
(credited)
to profit
Asset Liability or loss
GBP'000 GBP'000 GBP'000
At 1 January 2020 - 37,469 -
Reversal of temporary timing differences
on business combinations - (5,124) (5,124)
Reversal of temporary timing differences
on fixed assets - (355) (355)
Reclassification and other timing
differences - (894) -
Adjustment to deferred tax rates - 2,581 2,581
_______ _______ _______
At 31 December 2020 - 33,677 (2,898)
_______ _______ _______
Charged/
(credited)
to profit
Asset Liability or loss
GBP'000 GBP'000 GBP'000
At 1 January 2019 - 23,579 -
Arising on business combinations - 16,752 -
Reversal of temporary timing differences
on business combinations - (3,736) (3,736)
Fixed asset and other differences - 847 -
Reversal of temporary timing differences
on fixed asset and other differences - 27 27
_______ _______ _______
At 31 December 2019 - 37,469 (3,709)
_______ _______ _______
20. Notes supporting the cash flow
Non-cash transactions from financing activities are shown in the
reconciliation of liabilities as follows
IFRS 16
Lease Bank loan
Cash liability Total
GBP'000 GBP'000 GBP'000 GBP'000
At 1 January 2020 26,917 (164,577) - (137,660)
Cash flows 3,113 24,214 (4,880) 22,447
Non-cash items
* Bank arrangement fee release - - (43) (43)
- Lease additions - (55,153) - (55,153)
* Disposals - 2,382 - 2,382
* Finance expense - (9,641) (26) (9,667)
* Concessions - 8,306 - 8,306
* Foreign exchange difference - (3,497) - (3,497)
_______ _______ _______ _______
At 31 December 2020 30,030 (197,966) (4,949) 172,885
_______ _______ _______ _______
Significant non-cash transactions are as follows:
Restated
2020 2019
GBP'000 GBP'000
Purchases of site assets, equipment and motor
vehicles unpaid at year end - 105
Contingent consideration on business combination - 4,864
IFRS 16 right of use asset recognised 54,309 99,066
IFRS 16 prepayments adjustment - 856
IFRS 16 right of use asset and lease liability
disposal 2,382 816
IFRS 16 right of use liability recognised - 99,719
IFRS 16 new operating leases 55,153 15,643
IFRS 16 interest payable 9,560 6,915
Accrued consideration - 627
Interest payable on contingent consideration 552 538
_______ _______
21. Restatement of prior year consolidated financial statements
Subsequent to the approval of the financial statements for the
year ended 31 December 2019, the Director's became aware of
information relating to the following:
-- Subsequent to the acquisition of Ngage Media B.V, the
Directors became aware of an error being presented in the financial
statements. Following the identification of a clause in relation to
the contingent consideration, the payment of the contingent
consideration was not only conditional on the satisfaction of
performance targets, the basis upon which it was previously
treated, but also on the condition of continued employment of
certain personnel within the business. In line with IFRS 3, the
acquisition accounting has been corrected. This contingent
consideration should be treated as an employee remuneration expense
in the period in which performance targets have been satisfied. The
discounted contingent consideration previously recognised, has been
removed resulting in a GBP6.5m reduction in the goodwill previously
reported, and an additional charge in the profit and loss statement
of GBP2.1m of deemed consideration was recognised. Interest cost on
the contingent consideration balance unwind of GBP0.7m was also
derecognised. This adjustment impacted the prior year consolidated
profit and loss, financial position, statement of changes in equity
and cash flow.
-- During the application of IFRS16, the date upon which the
modified retrospective approach was applied was incorrect,
resulting in a GBP6.4m adjustment to the right of use asset and
retained earnings. The transition adjustment was based on the lease
signing date, however following further analysis, the adoption date
should have been the date upon which the UK businesses were
acquired, being 28 March 2018 for the legacy UK business and 2 June
2018 for Forrest Outdoor Media Limited.
-- Further investigation into the application of IFRS16 revealed
a single lease that had not been recognised on the lease signing
date on 23 December 2019. This has resulted in an additional right
of use asset of GBP4.2m being recognised, and a GBP4.2m lease
liability also being recognised. There was with no material P&L
impact given the proximity of the lease signing date and the year
end. Further to this, the presentation of the interest paid on IFRS
16 was not split from the capital repayment. Interest paid is now
to be presented within financing activities, and GBP6.9m of
interest charge to be included within interest paid, with the
capital repayment of the lease liability as presented in the
previous year decreasing by the same amount.
The following amendments have been made to the comparatives
reported in the current year's financial statements:
Year ended 31 December As Restated As previously
2019 reported Change
(All amounts in GBP'000)
Statement of profit and
Loss
Interest payable on contingent
consideration 552 1,281 (729)
Administrative expenses 44,087 41,869 2,218
Statement of financial
position
Goodwill 173,434 179,904 (6,470)
Right of use asset 159,176 148,630 10,546
Non-current Lease liability 140,390 136,210 4,180
Retained deficit 3,826 8,703 (4,877)
Net assets 374,034 369,157 4,877
Contingent consideration
- NCL 2,564 7,545 (4,981)
Statement of changes
in equity
IFRS 16 restatement 3,913 10,279 (6,366)
Statement of cash flows
Loss for the year 6,736 5,247 1,489
Finance expense 7,505 8,234 (729)
(Decrease) / increase
in trade and other payables 6,761 4,543 2,218
Interest paid - 38 (38)
Net cash flows from operating
activities 44,382 44,344 38
Interest paid 6,954 - 6,954
Payment of lease liability 17,724 24,640 (6,916)
Net cash flows from financing
activities 27,095 27,057 (38)
There was no impact on the amounts reported for "net decrease in
cash and cash equivalents" or "cash and cash equivalents" at the
end of 2019.
22. Share capital
The authorised shares of the Company are as follows:
Authorised 2020 2019
GBP'000 GBP'000
Unlimited number of Ordinary Shares - -
_______ ________
Ordinary Shares, no par value 2020 2020 2019 2019
Number Premium Number Premium
'000 GBP'000 '000 GBP'000
Balance at beginning of period 54,009 376,246 53,921 375,594
Issued and fully paid during
the period 87 652 88 652
_______ _______ _______ _______
Balance at end of period 54,096 376,898 54,009 376,246
_______ _______ _______ _______
Shares held in treasury, no par 2020 2020 2019 2019
value
Number Number
'000 GBP'000 '000 GBP'000
Balance at beginning of period 397 2,417 - -
Shares acquired - - 397 2,417
_______ _______ _______ _______
Balance at end of period 397 2,417 397 2,417
_______ _______ _______ _______
Founder Preferred Shares, no 2020 2020 2019 2019
par value
Number Number
'000 GBP'000 '000 GBP'000
Balance at beginning of period 612 4,561 700 5,213
Converted during the period (87) (652) (88) (652)
_______ _______ _______ _______
Balance at end of period 525 3,909 612 4,561
_______ _______ _______ _______
147,000 Founder Preferred Shares were issued on 20 January 2017
at US$10.50 per share and a further 553,000 issued on 8 March 2017,
also at US$10.50 per share. 87,500 Founder Preferred Shares were
converted on 15 January 2019 into Ordinary shares on a one-for-one
basis. A further 87,500 Founder Preferred Shares were converted on
16 January 2020 into Ordinary shares on a one-for-one basis. There
are no Founder Preferred Shares held in Treasury. Each Founder
Preferred Share was issued with a Warrant as described below.
On 19 March 2019, the Company announced a discretionary share
buyback programme through its investment bank to purchase up to an
aggregate amount of US$25.0m (circa GBP18.8m) of Ordinary Shares.
The arrangement allows the investment bank to purchase up to
5,000,000 Ordinary Shares in the Company during open periods of the
Company until 30 September 2019. The price limits of Regulation
(EU) No 596/2014 of 16 April 2014 (as amended) in relation to
market abuse apply. The sole purpose of the share purchases was
to reduce the Company's share capital. Any Ordinary Shares
purchased by the Company were held in treasury. At 31 December 2020
there were 396,730 Ordinary Shares held in Treasury purchase for a
total consideration of US$3.1m (circa GBP2.4m).
As at 31 December 2020, the company had in issue 53,699,114
Ordinary Shares and 396,730 Ordinary Shares held in Treasury. The
company also had in issue 525,000 Founder Preferred Shares.
Ordinary Shares
Ordinary Shares confer upon the holders (in accordance with the
Articles):
a) Subject to the BVI Companies Act, on a winding-up of the
Company the assets of the Company available for distribution shall
be distributed, provided there are sufficient assets available, to
the holders of Ordinary Shares and Founder Preferred Shares pro
rata to the number of such fully paid up shares held by each holder
relative to the total number of issued and fully paid up Ordinary
Shares as if such fully paid up Founder Preferred Shares had been
converted into Ordinary Shares immediately prior to the
winding-up;
b) the right, together with the holders of the Founder Preferred
Shares, to receive all amounts available for distribution and from
time to time to be distributed by way of dividend or otherwise at
such time as the Directors shall determine, pro rata to the number
of fully paid up shares held by the holder, as if the Ordinary
Shares and Founder Preferred Shares constituted one class of share
and as if for such purpose the Founder Preferred Shares had been
converted into Ordinary Shares immediately prior to such
distribution; and
c) the right to receive notice of, attend and vote as a member
at any meeting of members except in relation to any Resolution of
Members that the Directors, in their absolute discretion (acting in
good faith) determine is: (i) necessary or desirable in connection
with a merger or consolidation in relation to, in connection with
or resulting from the Acquisition
d) (including at any time after the Acquisition has been made);
or (ii) to approve matters in relation to, in connection with or
resulting from the Acquisition (whether before or after the
Acquisition has been made).
Founder Preferred Shares
The Founder Preferred Shares have US$nil par value and carry the
same rights, including the right to receive dividends, as Ordinary
Shares. At the discretion of the holder, the Founder Preferred
Shares can be converted into Ordinary Shares on a one-for-one
basis.
The Founder Preferred Shares are structured to provide a
dividend based on the future appreciation of market value of the
Ordinary Shares, thus aligning the interests of the founders (as
defined in the Prospectus) with Ocean Outdoor Limited (formerly
Ocelot Partners Limited) investors on a long-term basis. This
dividend payment is calculated as follows: the Founder Preferred
Shares are divided into eight equal tranches, pro rata to the
number of Founder Preferred Shares held by each holder. On each
Enhancement Date, the rights which are comprised in one such
tranche (the "Enhanced Tranche") shall be enhanced by increasing
the holders of the Enhanced Tranche's proportionate entitlement to:
(a) any assets of the Company which are distributed to members on a
winding up of the Company; and (b) any amounts which are
distributed by way of dividend or otherwise if and to the extent
necessary to ensure that on such Enhancement Date, the Enhanced
Tranche has a market value which is at least equal to the market
value of the Relevant Number of Ordinary Shares at such time (which
for these purposes shall be determined in accordance with
sub-section (1) of section 421 of the United Kingdom Income Tax
(Earnings and Pensions) Act 2003. So far as possible, any such
enhancement shall be divided between the holders of the Enhanced
Tranche pro rata to the number of Founder Preferred Shares which
are held by them and comprised in the Enhanced Tranche.
As at each Enhancement Date, the Relevant Number of Ordinary
Shares means:
a) a number of Ordinary Shares equal to the aggregate number of
Founder Preferred Shares comprised in the Enhanced Tranche (subject
to adjustment in accordance with the Articles); plus
b) if the conditions for the Additional Annual Enhancement have
been met, such number of Ordinary Shares as is equal to the
Additional Annual Enhancement Amount divided by the Additional
Annual Enhancement Price (any increase in the calculation of the
Relevant Number of Ordinary Shares pursuant to this paragraph (b)
being referred to as the "Additional Annual Enhancement"); plus
c) if any dividend or other distribution has been made to the
holders of Ordinary Shares in the relevant Enhancement Year, such
number of Ordinary Shares as is equal to the Ordinary Share
Dividend Enhancement Amount at the Ordinary Share Dividend Payment
Price (any increase in the calculation of the Relevant Number of
Ordinary Shares pursuant to this paragraph (c) being referred to as
the "Ordinary Share Dividend Enhancement").
The conditions for the Additional Annual Enhancement referred to
in paragraph (b) above are as follows:
I. no Additional Annual Enhancement will occur until such time
as the Average Price per Ordinary Share for any ten consecutive
Trading Days following Admission is at least $11.50;
II. following the first Additional Annual Enhancement, no
subsequent Additional Annual Enhancement will occur unless the
Additional Annual Enhancement Price for the relevant Enhancement
Year is greater than the highest Additional Annual Enhancement
Price in any preceding Enhancement Year.
In the first Enhancement Year in which the Additional Annual
Enhancement is eligible to occur, the Additional Annual Enhancement
Amount will be equal to (i) 20 per cent. of the difference between
$10.00 and the Additional Annual Enhancement Price, multiplied by
(ii) the number of Ordinary Shares outstanding immediately
following the Acquisition including any Ordinary Shares issued
pursuant to the exercise of Warrants but excluding any Ordinary
Shares issued to shareholders or other beneficial owners of a
company or business acquired pursuant to or
in connection with the Acquisition (the "Preferred Share
Enhancement Equivalent").
Thereafter, the Additional Annual Enhancement Amount will be
equal in value to 20 per cent. of the increase in the Additional
Annual Enhancement Price over the highest Additional
Annual Enhancement Price in any preceding Enhancement Year
multiplied by the Preferred Share Enhancement Equivalent.
For the purposes of determining the Additional Annual
Enhancement Amount, the Additional Annual Enhancement Price is the
Average Price per Ordinary Share for the last 30 consecutive
Trading Days in the relevant Enhancement Year (the "Enhancement
Determination Period")
Hurdle shares
Ocean Jersey Topco Limited, a subsidiary of the Company, issued
shares to management which can be converted to shares in Ocean
Outdoor Limited under certain circumstances. 6,660,000 of these
hurdle shares were issued on 28 March 2018. The hurdle shares will
only accrue value when the price of Ordinary Shares has increased
by at least 10 per cent on a compound basis over a base price of
$10.00 per share, for each financial year since the date that the
participants
acquired the shares (including the financial year in which the
Ocean Transaction was completed). 3,330,000 of these shares vest
over a four-year period and 3,330,000 vest over a five-year
period.
The hurdle shares do not have a right to receive dividend
payments, except in the event of a winding-up of Ocean Jersey Topco
Limited, or other unusual circumstances. The hurdle shares do not
carry voting rights.
Securities carrying special rights:
Save as disclosed above in relation to the Founder Preferred
Shares, no person holds securities in the Company carrying special
rights with regard to control of the Company.
Voting rights:
Holders of Ordinary Shares will have the right to receive notice
of and to attend and vote at any meetings of members. Each holder
of Ordinary Shares being present in person or by proxy at a meeting
will, upon a show of hands, have one vote and upon a poll each such
holder of Ordinary Shares present in person or by proxy will have
one vote for each Ordinary Share held by them. In the case of joint
holders of a share, if two or more persons hold shares jointly each
of them may be present in person or by proxy at a meeting of
members and may speak as a member, if only one of the joint owners
is present, they may vote on behalf of all joint owners, and if two
or more joint holders are present at a meeting of members, in
person or by proxy, they must vote as one.
Restrictions on voting:
No member shall, if the Directors so determine, be entitled in
respect of any share held by them to attend or vote (either
personally or by proxy) at any meeting of members or separate class
meeting of the Company or to exercise any other right conferred by
membership in relation to any such meeting if they or any other
person appearing to be interested in such shares has failed to
comply with a notice requiring the disclosure of shareholder
interests and given in accordance with the Company's articles of
association (the "Articles") within 14 calendar days, in a case
where the shares in question represent at least 0.25% of their
class, or within seven days, in any other case, from the date of
such notice. These restrictions will continue until the information
required by the notice is supplied to the Company or until the
shares in question are transferred or sold in circumstances
specified for this purpose in the Articles.
Rights to appoint and remove Directors
Subject to the BVI Companies Act and the Articles, the Directors
shall have power at any time, and from time to time, without
sanction of the members, to appoint any person to be a Director,
either to fill a casual vacancy or as an additional Director.
Subject to the BVI Companies Act and the Articles, the members may
by a Resolution of Members appoint any person as a Director and
remove any person from office as a Director.
For so long as an initial holder of Founder Preferred Shares
(being a Founding Entity together with its affiliates) holds 20% or
more of the Founder Preferred Shares in issue, such holder shall be
entitled to nominate a person as a Director of the Company and the
Directors shall appoint
such person. In the event such holder notifies the Company to
remove any Director nominated by them the other Directors shall
remove such Director, and in the event of such a removal the
relevant holder shall have the right to nominate a Director to fill
such vacancy.
23. Earnings per share
2020 2019
GBP'000 GBP'000
Numerator
Loss used in basic and diluted EPS (179,505) (6,736)
_______ _______
Denominator '000 '000
Weighted average number of shares used in basic EPS 53,696 53,590
_______ _______
Weighted average number of shares used in diluted EPS 53,696 53,590
_______ _______
Basic EPS (pence) (334.3p) (12.6p)
_______ _______
Diluted EPS (pence) (334.3p) (12.6p)
_______ _______
At 31 December 2020, the warrants had expired and the directors'
share options, the founder preferred shares and the hurdle shares
were currently considered to be non-dilutive. They are expected to
become dilutive once in the money.
24. Reserves
The following describes the nature and purpose of each reserve
within equity:
Reserve Description and purpose
Treasury share reserve Amount paid by the company to
purchase its own shares.
Share premium Amount subscribed for share capital
in excess of nominal value.
Retained earnings All other net gains and losses
and transactions with owners (e.g.
dividends) not recognised elsewhere.
Foreign exchange reserve Foreign exchange gains and losses
on translation of subsidiary undertakings
into the presentational currency
of the Group.
25. Related party disclosures
2020 Founder
Ordinary Preferred
Shares Shares
Number Number
'000 '000
Andrew Barron 18 (18)
Aryeh B. Bourkoff 50 (50)
_______ _______
68 (68)
_______ _______
During the period the Company issued the following Shares to
directors of the company, exchanging founder preferred shares for
ordinary shares:
2019 Founder
Ordinary Preferred
Shares Shares
Number Number
'000 '000
Andrew Barron 18 (18)
Aryeh B. Bourkoff 50 (50)
_______ _______
68 (68)
_______ _______
The fees paid to directors during the period to 31 December 2020
were as follows:
2020 2019
GBP'000 GBP'000
Andrew Barron - -
Tim Bleakley 312 453
Aryeh B. Bourkoff - -
Sangeeta Desai 16 67
Thomas Ebeling 14 59
Tom Goddard 79 88
Stephen Joseph 247 411
Robert Marcus 19 78
Andrew Miller - 67
Thomas Smith - -
Martin HP Söderström 16 67
_______ _______
703 1,290
_______ _______
During the year a hurdle share expense of GBP90k (FY19: GBP90k)
was incurred by the Group. Of this charge, GBP17k related to hurdle
shares issued to Tom Goddard, GBP27k related to hurdle shares
issued to Tim Bleakley and GBP17k related to hurdle shares issued
to Stephen Joseph.
26. Events after the reporting date
In accordance with the London Stock Exchange Admission and
Disclosure Standards, the Company announced, pursuant to its
articles of association, a tranche of 87,500 founder preferred
shares have been automatically re-designated as ordinary shares on
a one for one basis. This re-designation became effective on 6
January 2021.
Subsequent to the year end, further measures have been taken by
Governments across Europe restricting the movement of the
population and the forced closure of non-essential business. Given
the company operates in the DOOH market, this has impacted on the
company's performance in FY21, as it did in FY20. The effect
COVID-19 will continue have on the economy and the company is
unknown, however following the vaccine roll out across the UK and
Europe, market conditions are expected to improve compared to FY20.
The Directors recognise there remain some uncertainties, however
they are of the opinion the business is able to continue to
navigate through the impact of COVID-19 due to the strength of its
market position, its robust balance sheet, cash surplus and the
availability of debt facilities to draw upon. An extension to these
debt facilities was agreed post year end, with the debt covenants
also re-based to providing additional headroom should the impact of
COVID-19 continue beyond market expectations.
There are a number of factors that will determine the overall
impact COVID-19 will have. The Group recognised impairment charges
at the year-end following an assessment of the impact COVID-19 has
had and will continue to have on the Group. At the balance sheet
date there were no indicators additional impairments should be
recognised on any of the Group assets. The Group will continue to
assess the impact of COVID-19 on the business combinations, and all
other Group assets, for any indicators that they are held at
carrying values in excess of their fair value.
The following pages present unaudited proforma financial
information for entities owned by the Group as at 31 December 2020,
which show the year-on-year results on a combined basis assuming
subsidiaries acquired during FY19 had been acquired on 1 January
2019. This allows analysis and assessment of the underlying
performance of operations, ignoring timing differences relating to
the date of acquisition. The FY19 financials will therefore differ
to the FY19 reported figures presented on page 28.
In the prior year, proforma financial results for overseas
operations were translated using the constant currency methodology.
Common practice indicates overseas operations should be translated
at the average rate for the year. Therefore, the proforma prior
year results have been restated using the FY19 average rate and all
future results will continue to be translated using the average
rate of that year. Any FX impact will be highlighted
separately.
Current year and prior year financials are provided for
comparison. The same period financials are also presented excluding
the IFRS 16 accounting standard which came in to effect 1 January
2019.
There is also a reconciliation of Profit from operations to
Adjusted EBITDA.
Ocean Outdoor Limited and subsidiaries
The results below present the Group on an unaudited proforma
basis.
Excl. Excl.
IFRS 16 IFRS
16
FY20 FY19 FY20 FY19
GBP'000 GBP'000 GBP'000 GBP'000
Billings 104,702 171,619 104,702 171,619
_______ _______ _______ _______
Revenue 86,171 139,594 86,171 139,594
Cost of sales (63,724) (75,680) (70,086) (82,964)
_______ _______ _______ _______
Gross profit 22,447 63,914 16,085 56,630
Administrative and other expenses (196,188) (56,975) (197,588) (57,363)
_______ _______ _______ _______
(Loss) / profit from operations (173,741) 6,939 (181,503) (733)
Loss from fixed asset investments (94) - (94) -
Finance expense (10,478) (9,422) (837) (945)
Finance income 17 521 17 521
_______ _______ _______ _______
Loss before tax (184,296) (1,962) (182,417) (1,157)
Tax expense 4,791 (4,821) 4,791 (4,821)
_______ _______ _______ _______
Loss from continuing operations (179,481) (6,783) (177,626) (5,978)
_______ _______ _______ _______
Total comprehensive loss (179,505) (6,783) (177,626) (5,978)
_______ _______ _______ _______
Excl. Excl.
IFRS 16 IFRS
16
FY20 FY19 FY20 FY19
GBP'000 GBP'000 GBP'000 GBP'000
(Loss) / profit from operations (173,741) 6,939 (181,503) (733)
Depreciation 42,871 35,199 9,977 8,008
Impairment on site asset 1,435 - 1,435 -
Amortisation 24,768 19,753 24,768 19,753
Profit on disposal (7) (31) 117 -
Impairment on intangible assets
and investments 141,600 - 141,600 -
Fair value adjustment of contingent
consideration (2,256) 2,218 (2,256) 2,218
Deal fees 3,093 2,237 3,093 2,237
Debt raise fee 551 - 551 -
Currency movements 554 638 554 638
Restructuring and redundancy costs 1,038 - 1,038 -
Other one-off costs 239 819 239 819
_______ _______ _______ _______
Adjusted EBITDA 40,145 67,772 (387) 32,940
_______ _______ _______ ______
Ocean Outdoor Limited and subsidiaries
The table below reconciles the reported profit from operations
to Reported Adjusted EBITDA and then reconciles Reported Adjusted
EBITDA to the Proforma Adjusted EBITDA.
FY20 FY19
GBP'000 GBP'000
Reported (loss) / profit from operations (173,741) 792
Depreciation on right of use asset 32,894 19,706
Depreciation on site assets, equipment
and motor vehicles 9,977 6,953
Impairment on site asset 1,435 -
Amortisation 24,768 19,753
Impairment on intangible assets and investments 141,600 -
Profit on disposal (7) -
Post-acquisition add-backs 3,219 5,540
_______ _______
Reported Adjusted EBITDA 40,145 52,744
IFRS 16 adjustment - pre acquisition costs - 15,028
_______ _______
Proforma Adjusted EBITDA 40,145 67,772
Deduct site rents (40,532) (24,495)
Reversal of IFRS 16 adjustment - pre acquisition
costs - (15,028)
Add acquisitions' pre acquisition profit
from operations - 4,319
Add pre acquisition add-backs - 372
_______ _______
Proforma Adjusted EBITDA Excl. IFRS 16 (387) 32,940
_______ ______
Ocean Outdoor Limited and UK operating subsidiaries
The results below present the Ocean Outdoor Limited and UK
operating subsidiaries on an unaudited proforma basis.
Excl. Excl.
IFRS 16 IFRS
16
FY20 FY19 FY20 FY19
GBP'000 GBP'000 GBP'000 GBP'000
Billings 55,520 101,631 55,520 101,631
_______ _______ _______ _______
Revenue 39,240 71,668 39,240 71,668
Cost of sales (33,660) (40,710) (37,652) (43,938)
_______ _______ _______ _______
Gross profit 5,580 30,958 1,588 27,730
Administrative and other expenses (112,587) (37,538) (112,751) (37,916)
_______ _______ _______ _______
Loss from operations (107,007) (6,580) (111,163) (10,186)
Loss from fixed asset investments (94) - (94) -
Finance expense (6,148) (5,841) (757) (549)
Finance income - 509 - 509
_______ _______ _______ _______
Loss before tax (113,249) (11,912) (112,014) (10,226)
Tax expense 4,272 (2,856) 4,272 (2,856)
_______ _______ _______ _______
Loss from continuing operations (108,977) (14,768) (107,742) (13,082)
_______ _______ _______ _______
Total comprehensive loss (108,977) (14,768) (107,742) (13,082)
_______ _______ _______ _______
Excl. Excl.
IFRS 16 IFRS
16
FY20 FY19 FY20 FY19
GBP'000 GBP'000 GBP'000 GBP'000
Loss from operations (107,007) (6,580) (111,163) (10,186)
Depreciation 20,751 17,723 6,269 5,009
Impairment on site asset 1,435 - 1,435 -
Amortisation 24,768 19,753 24,768 19,753
Profit on disposal (107) (21) - -
Impairment on intangible assets
and investments 75,000 - 75,000 -
Fair value adjustment of contingent
consideration (2,256) 2,218 (2,256) 2,218
Deal fees 3,093 2,237 3,093 2,237
Debt raise fee 551 - 551 -
Currency movements 554 638 554 638
Restructuring and redundancy costs 602 - 602 -
Other one-off costs 164 447 164 447
_______ _______ _______ _______
Adjusted EBITDA 17,548 36,415 (983) 20,116
_______ _______ _______ ______
Ocean Netherlands
The results below present Ocean Netherlands (Ocean Outdoor
Netherlands, Ngage and Beyond) on an unaudited proforma basis,
translated in GBP using reported exchange rates.
Excl. Excl.
IFRS 16 IFRS
16
FY20 FY19 FY20 FY19
GBP'000 GBP'000 GBP'000 GBP'000
Billings 18,316 28,452 18,316 28,452
_______ _______ _______ _______
Revenue 17,263 26,390 17,263 26,390
Cost of sales (13,923) (13,564) (14,973) (14,701)
_______ _______ _______ _______
Gross profit 3,340 12,826 2,290 11,689
Administrative and other expenses (21,688) (6,608) (21,853) (6,618)
_______ _______ _______ _______
(Loss) / profit from operations (18,348) 6,218 (19,563) 5,071
Finance expense (2,528) (2,109) - (175)
Finance income 12 12 12 12
_______ _______ _______ _______
(Loss) / profit before tax (20,864) 4,121 (19,551) 4,908
Tax expense 581 (1,098) 581 (1,098)
_______ _______ _______ _______
(Loss) / profit from continuing
operations (20,283) 3,023 (18,970) 3,810
_______ _______ _______ _______
Total comprehensive (loss) / income (20,283) 3,023 (18,970) 3,810
_______ _______ _______ _______
Excl. Excl.
IFRS 16 IFRS
16
FY20 FY19 FY20 FY19
GBP'000 GBP'000 GBP'000 GBP'000
(Loss) / profit from operations (18,348) 6,218 (19,563) 5,071
Depreciation and tangible asset
impairment 10,166 9,037 2,538 2,055
Profit on disposal 100 (10) 117 -
Impairment on intangible assets
and investments 17,200 - 17,200 -
Restructuring and redundancy costs 109 - 109 -
Other one-off costs - 372 - 372
_______ _______ _______ _______
Adjusted EBITDA 9,227 15,617 401 7,498
_______ _______ _______ ______
Ocean Nordics
The results below present Ocean Nordics on an unaudited proforma
basis, translated in GBP using reported exchange rates.
Excl. Excl.
IFRS 16 IFRS
16
FY20 FY19 FY20 FY19
GBP'000 GBP'000 GBP'000 GBP'000
Billings 30,866 41,536 30,866 41,536
_______ _______ _______ _______
Revenue 29,668 41,536 29,668 41,536
Cost of sales (16,141) (21,406) (17,461) (24,325)
_______ _______ _______ _______
Gross profit 13,527 20,130 12,207 17,211
Administrative and other expenses (61,913) (12,829) (62,984) (12,829)
_______ _______ _______ _______
(Loss) / profit from operations (48,386) 7,301 (50,777) 4,382
Finance expense (1,802) (1,472) (80) (221)
Finance income 5 - 5 -
_______ _______ _______ _______
(Loss) / profit before tax (50,183) 5,829 (50,852) 4,161
Tax expense (62) (867) (62) (867)
_______ _______ _______ _______
(Loss) / profit from continuing
operations (50,245) 4,962 (50,914) 3,294
_______ _______ _______ _______
Total comprehensive (loss) / income (50,245) 4,962 (50,914) 3,294
_______ _______ _______ _______
Excl. Excl.
IFRS 16 IFRS
16
FY20 FY19 FY20 FY19
GBP'000 GBP'000 GBP'000 GBP'000
(Loss) / profit from operations (48,386) 7,301 (50,777) 4,382
Depreciation and tangible asset
impairment 11,954 8,439 1,170 944
Impairment on intangible assets
and investments 49,400 - 49,400 -
Restructuring and redundancy costs 327 - 327 -
Other one-off costs 75 - 75 -
_______ _______ _______ _______
Adjusted EBITDA 13,370 15,740 195 5,326
_______ _______ _______ ______
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END
FR EANSDEEAFEFA
(END) Dow Jones Newswires
May 04, 2021 02:00 ET (06:00 GMT)
Ocean Outdoor (LSE:OOUT)
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Ocean Outdoor (LSE:OOUT)
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から 1 2024 まで 1 2025
