TIDMCAU
RNS Number : 8908E
Centaur Media PLC
16 March 2022
16 March 2022
Centaur Media Plc
Preliminary results for the year ended 31 December 2021
Strong year of progress with growth in revenues, EBITDA and
EBITDA margin
On track for Margin Acceleration Plan (MAP23) objectives
Centaur Media, an international provider of business
intelligence, training and specialist consultancy, is pleased to
present its preliminary results for the year ended 31 December
2021.
Financial Highlights
GBPm 2021 2020
-------------------------------- ----- -------
Statutory revenue 39.1 32.4
Adjusted EBITDA ([1]) 6.4 3.8
Adjusted profit/(loss) before
tax 3.0 (0.3)
Statutory profit/(loss) before
tax 1.4 (2.6)
Group statutory profit/(loss)
after taxation 1.4 (14.4)
-------------------------------- ----- -------
-- Revenues increased 21% to GBP39.1m
-- Adjusted EBITDA grew 68% to GBP6.4m with margin growing to 16% in
line with MAP23 strategy
-- Group statutory profit of GBP1.4m
-- Proposing a final dividend of 0.5p per share
-- Net cash of GBP13.1m at year end, driven by EBITDA growth and cash
conversion (2) of 164%
-- Revenue from outside UK grew to 37% of total - up from 31% in 2020
In early 2021 Centaur launched its Margin Acceleration Plan
(MAP23) with the objective of generating over GBP45m in revenue and
an adjusted EBITDA margin of 23% by 2023. To support MAP23, Centaur
has continued to focus investment and resource allocation in its
Flagship 4 brands - Econsultancy, Influencer Intelligence, MW Mini
MBA and The Lawyer - which it considers the key drivers of organic
revenue growth. These are supported by Xeim's wider portfolio of
Core Brands.
Over the course of 2021, despite the continued impact of the
Covid pandemic, the Group has performed ahead of consensus and
remains on track to deliver on its ambitious MAP23 goals. The year
saw a 21% growth in revenue to GBP39.1m and a sustained improvement
in Adjusted EBITDA margin to 16% (2020: 12%), which contributed to
the further strengthening of Centaur's cash position to GBP13.1m.
Xeim and The Lawyer contributed to this result with increased
revenues, EBITDA and EBITDA margin.
Market and business knowledge provide an increasingly important
competitive advantage in the legal and marketing professions and
the past two years have accelerated the already rapid shift to
high-quality digital content. In a market characterised by change,
Centaur is delivering targeted connectivity together with deeper
insight, learning and consultancy expertise.
The objective across Centaur's portfolio of brands is to
position them for continued growth by harnessing cross-selling
opportunities, with the ultimate aim of enabling customers to
deliver better corporate outcomes through building competitive
advantage in their markets.
In 2021 Centaur's Flagship 4 brands benefitted from optimised
pricing, strong renewal rates and a recovery in events.
Econsultancy had particular success through providing blended
learning solutions and continuing to penetrate the top 200
companies by marketing spend, while Influencer Intelligence
overcame challenging market conditions in H1 to achieve H2 renewal
rates of 95%. MW Mini MBA had another outstanding year, with record
corporate sales for multi-seat packages and delegate numbers up
44%. The Lawyer saw excellent client renewal rates at 116% and
launched several new paid-for products.
Meanwhile, Centaur's Core Brands saw good revenue growth from
marketing solutions and successful hybrid events. The performance
of the Festival of Marketing was particularly encouraging, with
above-target sponsorship and delegate levels for its second
consecutive virtual event.
Overall, the value of the content and networking capabilities of
Centaur's brands enabled the business to increase the number, size
and quality of its customers. Revenue of GBP28.8m, representing
approximately three-quarters of the Group's total, came from our
valuable Premium Content, Marketing Services and Training and
Advisory recurring revenue streams. Centaur has also successfully
increased its international footprint, which now comprises 37% of
total revenues with two-thirds of the Group's revenue growth coming
from outside the UK.
Outlook
The excellent performance across the Group in 2021 provides a
good platform for further growth in 2022. Centaur will continue to
invest in quality across the Flagship 4 and Core Brands to take
advantage of the trends in the market and develop the Group's
offering for its customers, increasing the emphasis on
cross-selling of products and building on their synergies.
Centaur has started the year well and trading for the first two
months of 2022 is in line with the Board's expectations. Cash at 11
March 2022 was GBP12.1m.
The business is on track to meet its MAP23 objectives and will
aim to achieve this despite the market headwinds of inflation,
competition for talent and the current geopolitical backdrop.
Centaur will look to manage its margin through structured price
rises in relation to its services to customers, strong negotiation
with suppliers and flexible reward structures to retain and recruit
top talent.
Dividend
Centaur's Board is proposing a final dividend of 0.5p per share,
a total of 1p per share for the 2021 financial year. This is in
line with its dividend policy to distribute 40% of adjusted
earnings after taxation, subject to a minimum of 1p per share.
Swag Mukerji, Chief Executive Officer, commented:
"After the challenges of 2020, Centaur entered 2021 as a strong
and resilient business. We launched our Margin Acceleration Plan -
MAP23 - our strategy designed to drive profitable revenue growth,
and I am pleased that Centaur has made strong progress in line with
these objectives.
Over the course of 2021, it was particularly encouraging to see
how the business invested in the quality of the Flagship 4 and Core
Brands, positioning them for further growth and enhancing their
opportunities to cross-sell. We now have the talent, strategy and
financial discipline to realise the opportunities that lie ahead.
And none of this would have been possible without the hard work and
resilience of our brilliant colleagues, who are playing a pivotal
role in making MAP23 a reality."
Enquiries
Centaur Media plc
Swag Mukerji, Chief Executive Officer 020 7970 4000
Simon Longfield, Chief Financial Officer
Teneo
Zoë Watt / Matthew Thomlinson 07713 157561 / 07785 528363
Note to editors
Centaur is an international provider of business information,
training and specialist consultancy that inspires and enables
people to excel at what they do, raising the standard for insight,
interaction and impact.
Advise. Inform. Connect.
Our vision
We will be the 'go to' company in the international Marketing
and Legal sectors for:
-- Advising businesses on how to improve their performance and returns
on investment (ROI);
-- Informing customers using data, content and insight with the provision
of business intelligence products;
-- Offering training and advisory services through digital learning initiatives
and online programmes; and
-- Connecting specific communities through media and events.
We will build strong and lasting relationships with our
customers by providing cutting-edge insight and analysis to deliver
long-term sustainable returns for our shareholders.
Our business
Centaur is an international provider of business information,
training and specialist consultancy that inspires and enables
people to excel at what they do within the marketing and legal
professions. Our Xeim and The Lawyer business units serve the
marketing and legal sectors respectively and, across both, we offer
a wide range of products and services targeted at helping our
customers add value.
Our reputation is based on the trust and confidence arising from
a deep understanding of these sectors providing innovative products
and services and we have developed a strong track record for
providing our customers with market-leading insight, content, data
and training. Our key strengths are the expertise of our people,
the quality of our brands and products, and our ability to harness
technology to innovate continually and develop our customer
offering. This enables us to help our customers raise their
aspirations and deliver better performance.
Highlights of the year
Financial highlights
Revenue from continuing operations Adjusted EBITDA
GBP39.1m GBP6.4m (16% margin)
2020: GBP32.4m 2020: GBP3.8m (12% margin)
Cash Adjusted diluted EPS
GBP13.1m 1.9p
2020: GBP8.3m 2020: 0.3p
Strategic and operational highlights
-- Resilient performance against the backdrop of the Covid pandemic and
the business remains on track to deliver on its MAP23 objectives
-- Flagship 4 brands continued to deliver strong results, benefitting
from optimised pricing, strong renewal rates and the creation of hybrid
events
-- Developed the customer offering of our brands, including the introduction
of a campaign management tool for Influencer Intelligence, blended
learning for Econsultancy and further paid-for products at The Lawyer
-- Record cross-marketing performance of Xeim Brands, supported by Xeim
Engage and Xeim Labs marketing solutions
-- Hybrid events at The Lawyer continued to improve in content and networking
capability, leading to increased quality and size of customer
-- Improved brand profile at Xeim following further investment in our
marketing teams and digital marketing capabilities
-- Increased number of, and value generated from, large blue chip international
clients across Xeim
-- DICE, our employee engagement committee, has worked closely with employees
to implement initiatives to help Centaur build a more diverse and inclusive
workplace
Performance: CEO Review
This has been another unique year for Centaur.
After the challenges of 2020, Centaur entered 2021 as a strong
and resilient business. During 2021, our people were brilliant and
all showed great drive, energy and tenacity in serving our
customers while continuing to grow our business in the uncertain
economic environment. Their hard work supported 21% revenue growth
and 68% adjusted EBITDA growth while cash improved 58% compared to
2020 all ahead of market consensus.
In January 2021, we launched MAP23, our new strategy designed to
drive profitable revenue growth. The core objectives of MAP23 are
to raise Group Adjusted EBITDA margins to 23% by 2023, while
increasing revenues to more than GBP45m in the same timeframe. We
remain on track to deliver this.
Financial Performance
Over the course of the year, we took our first positive steps
towards our MAP23 goals, as well as putting in place an effective
organisation structure to deliver it.
In 2021, Centaur reported revenues of GBP39.1m for the year (up
21% from 2020), and a Group Adjusted EBITDA margin of 16% (up 4
percentage points from 2020). The Group ended the year with a cash
balance of GBP13.1m, up from GBP8.3m last year.
I am pleased with the contribution that all our brands have made
to this positive momentum over the past twelve months.
Dividends
The Group has proposed a final dividend for 2021 of 0.5p per
ordinary share, bringing the total dividends in respect of 2021 to
1.0p per ordinary share.
Operational review
Centaur comprises two business units, Xeim and The Lawyer. Xeim
(or "excellence in marketing") forms 82% of our revenues and is
focused on the marketing sector. The Lawyer is focused on the legal
sector and drives the other 18%. Both sectors are undergoing
significant change, driven by technological advancement, structural
transformation and globalisation all of which gives Centaur a great
opportunity for growth.
Within these two business units, Centaur has four key brands -
the Flagship 4 - which we consider our key growth drivers and where
the business prioritises investment and resource allocation. The
Lawyer is one of these brands, while the other three form part of
the Xeim portfolio (Econsultancy, Influencer Intelligence and MW
Mini MBA). The Flagship 4 is supported by our suite of Core
Brands.
Over the course of 2021, we made significant progress in
developing both our Flagship 4 and Core Brands. Our aim is to
position each of these brands for further growth, developing
cross-selling opportunities and enhancing their shared
capabilities, with the ultimate aim of enabling our customers to
deliver better corporate outcomes through building competitive
advantage in their markets.
At Econsultancy, we had success with the sale of blended
learning solutions and continued to penetrate the top 200 marketing
companies, winning contracts from large blue chip international
companies including Unilever, Bayer, UPS and PZ Cussons.
Econsultancy Live and the marketing solutions operation also
performed well with positive results and impressive revenue growth
compared to the prior year.
Influencer Intelligence grew in momentum as the year progressed,
overcoming the challenging market conditions from 2020 and in Q1
2021 to end the year with renewal rates at 84%. This was supported
by our new campaign management tool which helped drive new
business, 41% higher than 2020 levels. Our focus on higher value
clients supported margin growth and we are well positioned to
capitalise on attractive market dynamics in an industry worth
$15bn.
MW Mini MBA had another excellent year, with record corporate
sales for multi-seat packages and online revenues for both the
Marketing and Brand courses. Delegate numbers rose 44% with many of
our largest sales coming directly from recurring corporate
customers demonstrating the value they see in the courses.
The Lawyer also performed well, with excellent corporate client
renewal rates of 116% and daily usage of Horizon, the 7am daily
email. This was supported by several new paid for products
including Signal, which provides monthly in-depth strategic
insight, benchmark data on the markets and detailed reports on the
topics that matter most to law firms.
In our portfolio of Core Brands, we were particularly encouraged
by the performance of the Festival of Marketing. Last year's
Festival, titled "The Year Ahead", was held virtually for the
second consecutive year. With more than 80 speakers over the course
of four days, and above-target sponsorship and delegate levels, it
is well-placed to return even stronger as a hybrid event for
2022.
People
In August 2021 Jane Wilkinson joined the Group as the new
Managing Director of The Lawyer. Jane's experience in driving
revenue and margin growth across data, media, B2B and B2C
businesses will ensure The Lawyer is best placed to reach its MAP23
objectives and I am delighted to have her onboard. I would also
like to take this opportunity to thank Andy Baker for his
significant contribution to making The Lawyer a multi-faceted
subscription-based information provider with a strong digital
presence and market-leading retention rates .
We have also strengthened the senior management team in Centaur
with the appointment of Claire Rance as Managing Director of our
Core Brands, Gill Huber as Managing Partner of Oystercatchers and
Juan Mejia as Marketing Director of The Lawyer as well as the
promotion of Zara Paes to the role of Group Financial
Controller.
Looking to 2022
In 2022 our objective is to continue to drive revenue and margin
growth to deliver our MAP23 strategy. To do this we will focus
investment and resource allocation on our Flagship 4 brands while
continuing to develop our Core Brands, increasing the emphasis on
cross-selling our products and building on their synergies. We aim
to achieve this despite the market headwinds of inflation and
competition for talent and we will manage our margin through robust
negotiation with suppliers, flexible reward structures to retain
and recruit top talent and structured price rises in relation to
our services to customers.
We are confident in our MAP23 plan; the targets are ambitious
and achievable and, with our strong balance sheet and unique
portfolio of brands, we are well-placed to capitalise on future
market opportunities.
Centaur will continue to invest across the Flagship 4 and Core
Brands portfolios to take advantage of these trends and to develop
its offering for our customers.
Summary
To conclude, I wanted to reflect on the past two years and
reiterate my thanks to everyone at Centaur for their tremendous
effort and contribution to the growth of our business.
As we enter 2022 Centaur is well-positioned for growth. We have
a clear strategy in place and I am confident in our ability to hit
our targets. Next year we will continue to advance our offering and
capitalise on the many market opportunities that lie ahead of us as
we continue to invest in our brands and provide the most advanced
and competitive offering in the marketplace.
Key Performance Indicators
The Group has set out the following core financial and
non-financial metrics to measure the Group's performance. The KPIs
are monitored by the Board and the focus on these measures will
support the successful implementation of the MAP23 strategy. These
indicators are discussed in more detail in the CEO and financial
reviews.
KPI Graph Commentary
Financial
Underlying revenue 2021: 21%, 2020: The growth/(decline) in total revenue
growth* (14)% adjusted to exclude the impact of
event timing differences, as well
as the revenue contribution arising
from acquired or disposed businesses.
Adjusted EBITDA margin* 2021: 16%, 2020: Adjusted EBITDA as a percentage
12% of revenue where Adjusted EBITDA
is defined as adjusted operating
profit before depreciation and impairment
of tangible assets and amortisation
and impairment of intangible assets
other than those acquired through
a business combination.
Adjusted diluted EPS* 2021: 1.9p, 2020: Diluted earnings per share calculated
0.3p using the adjusted earnings, as
set out in note 9 to the financial
information.
Cash conversion* 2021: 164%, 2020: The percentage by which adjusted
100% operating cash flow covers Adjusted
EBITDA (on continuing and discontinued
operations) as set out in the financial
performance review.
Non-financial
=========================== ===================== ===========================================
Attendance at Festival 2021: 6,786, 2020: Number of unique delegates attending
of Marketing 3,938 the Festival of Marketing
Delegates on Mini 2021: 6,951, 2020: Number of delegates on Mini MBA
MBA course 4,813 and related eLearning courses in
the year
Xeim customers >GBP50k 2021: 90 (GBP12.1m), Number and value of Xeim customers
that have sales in the year of greater
than GBP50,000
2020: 77 (GBP10.4m)
Top 250 law firm customers 2021: 152 (61%), Number and percentage of top 200
UK law firms and top 50 US law firms
2020: 160 (64%)
=========================== ===================== ===========================================
*See definitions in Financial Review
Performance: Financial Review
Overview
2021 has been a year of organic growth recovery after the
significant challenges posed by the pandemic. The social and
governmental restrictions imposed in 2020 and the economic
uncertainties faced by our customers were unprecedented. The easing
of these measures, together with the focused strategic and
operational actions taken by Centaur's management team, has
supported organic growth across most revenue streams, notably
Training and Advisory and Events both up by approximately 50%
year-on-year. Premium content was an exception to this trend,
seeing revenues decline by 2% due to the downturn in renewals and
new business in 2020, which has had a knock-on impact on revenues
in the year.
After the divestments made in 2019 and the subsequent
restructuring of the business, combined with continued control over
our costs, we started 2021 in a good financial position. We are
pleased with the 21% growth in revenue compared to 2020, the
sustained expansion in EBITDA margin and the increase in our cash
balance. All of this demonstrates that we are on track to meet our
MAP23 objectives.
Performance
Group
Statutory revenue rose by GBP6.7m to GBP39.1m in 2021 - an
increase of 21%. Xeim increased 23% and The Lawyer 9%. 37% (2020:
31%) of the revenue was generated from outside the UK and this
year-on-year increase represented two-thirds of the total growth.
We will not be renewing or taking on any new business with Russian
customers during 2022, the impact of which is negligible to our
results.
Adjusted EBITDA increased from GBP3.8m to GBP6.4m at a margin of
16% (2020: 12%), showing promising progress towards our MAP23
targets. This improved margin was on increased revenues,
demonstrating the commitment to continued cost control and
profitable revenue growth following the previously completed cost
savings programme. Central operating costs rose by only 3% in
2021.
The Group posted an adjusted operating profit of GBP3.2m in the
year (2020: GBPnil), showing an improved trading performance for
the business year-on-year as a result of the operational gearing on
increased revenues. The Group achieved an adjusted profit after
taxation of GBP2.8m (2020: GBP0.4m).
During 2021, we have increased our cash balances from GBP8.3m to
GBP13.1m, mainly as a result of a focus on cash management, the
increase in EBITDA, healthy cash collections from customers and
working capital improvements from subscriptions growth and the
timing of payments.
Xeim
Xeim's revenue for 2021 was GBP32.1m, an increase of 23% from
GBP26.0m in 2020, surpassing pre-Covid revenue levels of GBP31.4m
in 2019. Premium content in 2021 fell 5% year-on-year, due mainly
to the economic uncertainties posed by the global pandemic in 2020
reducing both subscription renewal and new business billings in
that year. However, 2021 has seen a recovery in renewal rates and
new business across both Econsultancy and Influencer Intelligence,
which will lead to positive momentum on revenue in 2022.
Revenue from all other streams showed year-on-year growth, most
significantly in Training and Advisory and Events. Events revenue
grew by 69% to GBP2.7m, largely driven by the move from wholly
virtual events to hybrid events as some social distancing measures
and restrictions were eased in the second half of the year.
Training and Advisory revenue saw strong growth of 48% on the
back of continued excellent performance in eLearning revenues from
the MW Mini MBA marketing and brand courses, Econsultancy and
Oystercatchers.
Xeim posted an Adjusted EBITDA of GBP6.6m for the year, an
increase from GBP4.3m in 2020. This was predominantly driven by the
increase in revenue, offset by an associated increase in cost.
Xeim contains three of the Group's Flagship 4 brands -
Econsultancy, Influencer Intelligence and MW Mini MBA.
After facing difficulties posed by the pandemic in the prior
year, Econsultancy grew all revenue streams in 2021, with an
increase of 22% in the year, resulting in revenues now exceeding
pre-Covid levels. Our blended learning strategy was the main driver
of new business wins at more than three times the level seen in
2020, resulting in premium content revenue from Econsultancy
growing 18%. Subscription renewal rates increased to 69% (2020:
64%) and we are aiming to improve this further in 2022.
Econsultancy's training and advisory revenue also returned to
growth up 22% on 2020 and winning further large digital training
and consultancy contracts with blue chip international companies.
Events revenue almost trebled year-on-year from the Econsultancy
Live conferences held in April and November, together with
Econsultancy revenue from Marketing Solutions also increasing by
over 30%.
Influencer Intelligence revenue reduced 15% in the year. The
impact of Covid on the retail and fashion industries in 2020 and
the first quarter of 2021 had reduced billings due to cautious
marketing investment from core consumer-facing brand clients.
However, renewal rates improved significantly from Q2 of 2021
onwards and averaged close to the historically strong rates last
seen in 2019. New business also improved in 2021, up 41% on 2020.
Both these increases resulted in annualised book of business growth
of 3% in the year, after initially dropping by 6%; the revenue
benefits will be seen in 2022.
The MW Mini MBA continues to go from strength to strength, with
delegate numbers up 44% year-on-year and Net Promoter Scores of
+75. Revenue grew 66% from the increase in delegates and a rise in
the list price. Delegate increases are being driven in particular
by larger take up from recurring corporate customers as well as an
increase in online sales.
Of our core Xeim brands, Festival of Marketing has shown
significant recovery in 2021 through a series of three hybrid
events resulting in a doubling of revenue year-on-year. This is in
contrast with the reduced revenue in 2020 due to the move to
virtual events. Really B2B and Oystercatchers saw growth in revenue
of approximately 20% and the growth in revenue from Marketing Week
exceeded 30%, driven by contracts for Marketing Solutions.
The Lawyer
Overall revenues for The Lawyer grew by 9%. Premium content
revenue showed modest growth of 5%, primarily from corporate
subscriptions which grew 15%. However, this was offset by a planned
deferral of revenue relating to the move from the transactional
Market Reports product to the Signal product on a subscription
based revenue model. Without the impact of this deferral, premium
content revenues would have grown by over 10%.
High-margin recruitment advertising revenue grew 34%,
demonstrating a partial recovery from the reduction seen due to the
economic uncertainty in 2020 which saw law firms delay hiring. With
a move to hybrid events as social distancing measures eased, events
revenue grew 22% year-on-year to GBP1.1m, albeit lower than revenue
in 2019 when all events were face-to-face.
This led to a rise in Adjusted EBITDA from GBP2.1m in 2020 to
GBP2.7m in 2021. The underlying business continues to perform
strongly with strong renewal rates and continued engagement by
users indicating how important The Lawyer has become to leading law
firms and their fee earners.
Measurement and non-statutory adjustments
The statutory results of the Group are presented in accordance
with International Financial Reporting Standards ("IFRS"). The
Group also uses alternative reporting and other non-GAAP measures
as explained below and as defined in the table at the end of this
section.
Adjusting items
Adjusted results are not intended to replace statutory results
but are prepared to provide a better comparison of the Group's core
business performance by removing the impact of certain items from
the statutory results. The Directors believe that adjusted results
and adjusted earnings per share are the most appropriate way to
measure the Group's operational performance because they are
comparable to the prior year and consequently review the results of
the Group on an adjusted basis internally.
Statutory operating profit/(loss) from continuing operations
reconciles to adjusted operating profit and Adjusted EBITDA as
follows:
2021 2020
Note GBPm GBPm
------------------------------------ -------- --- ----- --- -----
Statutory operating profit/(loss) 1.6 (2.3)
Adjusting items:
Exceptional operating costs 4 - 0.2
Amortisation of acquired intangible
assets 11 1.1 1.5
Share-based payments 23 0.5 0.5
Loss on disposal of assets and
liabilities 11,12,18 - 0.1
1.6 2.3
------------------------------------ -------- --- ----- --- -----
Adjusted operating profit 3.2 -
Depreciation, amortisation and
impairment 3 3.2 3.8
------------------------------------ -------- --- ----- --- -----
Adjusted EBITDA 6.4 3.8
Adjusted EBITDA margin 16% 12%
------------------------------------ -------- --- ----- --- -----
Adjusting items from continuing operations of GBP1.6m in the
year (2020: GBP2.3m) are comprised as follows:
Adjusting Item Description
-------------------------- -----------------------------------------------------
Exceptional operating 2021 GBPnil. 2020 exceptional costs of GBP0.2m relate
costs primarily to staff restructuring costs following
the onset of the pandemic.
Amortisation of acquired Amortisation of acquired intangible assets of GBP1.1m
intangible assets (2020: GBP1.5m) has fallen as certain assets have
become fully amortised.
Share-based payments Share-based payments of GBP0.5m were at a similar
level (2020: GBP0.5m).
Loss on disposal of assets 2021 GBPnil. In 2020 GBP0.1m relates primarily to
and liabilities asset write-offs and disposals.
-------------------------- -----------------------------------------------------
Segment profit
Segmental profit is reported to improve clarity around our
business units' performance and consists of gross contribution for
a business unit minus specific overheads and allocations of the
central support teams and overheads that are directly related to
each business unit. Any costs not attributable to either Xeim or
The Lawyer, remain as part of central costs.
The table below shows the statutory revenue for each business
unit:
The The
Xeim Lawyer Total Xeim Lawyer Total
2021 2021 2021 2020 2020 2020
GBPm GBPm GBPm GBPm GBPm GBPm
------------------------- ----- ------- ----- ----- ------- -----
Revenue
Premium Content 9.0 3.9 12.9 9.5 3.7 13.2
Marketing Services 3.3 - 3.3 2.9 - 2.9
Training and Advisory 12.6 - 12.6 8.5 - 8.5
Events 2.7 1.1 3.8 1.6 0.9 2.5
Marketing Solutions 4.2 0.8 5.0 3.3 0.9 4.2
Recruitment Advertising 0.3 1.2 1.5 0.2 0.9 1.1
------------------------- ----- ------- ----- ----- ------- -----
Total statutory revenue 32.1 7.0 39.1 26.0 6.4 32.4
------------------------- ----- ------- ----- ----- ------- -----
Revenue growth 23% 9% 21%
------------------------- ----- ------- ----- ----- ------- -----
The table below reconciles the adjusted operating profit/(loss)
for each segment to the Adjusted EBITDA:
Xeim The Lawyer Central Total Xeim The Lawyer Central Total
2021 2021 2021 2021 2020 2020 2020 2020
GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
--------------------------------- ------ ---------- ------- ------ ------ ---------- ------- ------
Revenue 32.1 7.0 - 39.1 26.0 6.4 - 32.4
Operating costs (27.6) (4.9) (3.4) (35.9) (24.1) (5.0) (3.3) (32.4)
--------------------------------- ------ ---------- ------- ------ ------ ---------- ------- ------
Adjusted operating profit/(loss) 4.5 2.1 (3.4) 3.2 1.9 1.4 (3.3) -
Adjusted operating margin 14% 30% 8% 7% 22% 0%
Depreciation, amortisation
and impairment 2.1 0.6 0.5 3.2 2.4 0.7 0.7 3.8
--------------------------------- ------ ---------- ------- ------ ------ ---------- ------- ------
Adjusted EBITDA 6.6 2.7 (2.9) 6.4 4.3 2.1 (2.6) 3.8
Adjusted EBITDA margin 21% 39% 16% 17% 33% 12%
--------------------------------- ------ ---------- ------- ------ ------ ---------- ------- ------
Xeim's telemarketing business, MarketMakers, was closed in 2020
and its results in the prior-year comparatives are not shown above
but within discontinued operations.
Net finance costs
Net finance costs were GBP0.3m (2020: GBP0.3m). The Group held
positive cash balances throughout the year and therefore, in both
2021 and 2020, the vast majority of finance costs relate to the
commitment fee payable for the revolving credit facility as well as
interest on lease payments for right-of-use assets.
Taxation
A tax credit of GBP0.1m (2020: credit of GBP0.9m) has been
recognised on continuing operations for the year. The adjusted tax
charge was GBP0.1m (2020: credit of GBP0.6m). The Company's profits
were taxed in the UK at a blended rate of 19% (2020: 19.0%), but
the resulting tax charge is more than offset by a credit resulting
from the effect of changes in the tax rate on deferred tax
balances. See note 7 for a reconciliation between the statutory
reported tax charge and the adjusted tax charge.
Earnings/loss per share
The Group has delivered adjusted diluted earnings per share for
the year of 1.9 pence (2020: 0.3 pence). Diluted earnings per share
for the year were 0.9 pence (2020: loss of 10.0 pence). Full
details of the earnings per share calculations can be found in note
9 to the financial information.
Dividends
Under the Group's dividend policy, Centaur will target a pay-out
ratio of 40% of adjusted retained earnings, subject to a minimum
dividend of 1.0p per share per annum.
In light of this, the Group has proposed a final dividend in
March 2022 of 0.5p per ordinary share in respect of 2021. This
brings the total dividends relating to 2021 to 1.0p (2020: 0.5p)
per ordinary share.
This final dividend is subject to shareholder approval at the
Annual General Meeting and, if approved, will be paid on 27 May
2022 to all ordinary shareholders on the register at the close of
business on 13 May 2022.
Cash flow
2021 2020
GBPm GBPm
-------------------------------------------- ----- -----
Adjusted operating profit 3.2 -
Depreciation, amortisation and impairment 3.2 4.0
Movement in working capital 3.1 2.5
-------------------------------------------- ----- -----
Adjusted operating cash flow 9.5 6.5
Capital expenditure (0.8) (0.8)
Cash impact of adjusting items - (4.6)
Taxation - -
Repayment of lease obligations and interest (2.2) (2.1)
-------------------------------------------- ----- -----
Free cash flow 6.5 (1.0)
Disposal of subsidiaries - (0.1)
Disposal of intangible assets - 0.1
Purchase of own shares (0.3) -
Dividends paid to Company's shareholders (1.4) -
-------------------------------------------- ----- -----
Increase/(decrease) in net cash 4.8 (1.0)
Opening net cash 8.3 9.3
-------------------------------------------- ----- -----
Closing net cash 13.1 8.3
-------------------------------------------- ----- -----
Cash conversion 164% 100%
-------------------------------------------- ----- -----
Adjusted operating cash flow is not a measure defined by IFRS.
Centaur defines adjusted operating cash flow as cash flow from
operations excluding the impact of adjusting items. The Directors
use this measure to assess the performance of the Group as it
excludes volatile items not related to the core trading of the
Group and includes the Group's management of capital expenditure. A
reconciliation between cash flow from operations and adjusted
operating cash flow is shown in note 1(b) to the financial
information. The cash impact of adjusting items in 2020 primarily
related to exceptional restructuring costs.
The movement in working capital in 2021 includes a repayment of
GBP1.0m of VAT deferred under the Government's Covid VAT payment
deferral scheme (2020: GBP1.0m deferral). 2020 also included the
receipt of GBP1.5m relating to the lease incentive on the Group's
former office premise. The cash conversion of 164% (2020: 100%) has
been adjusted to exclude these one-off items. The cash conversion
has increased significantly as a result of the positive working
capital movements relating to increased bonuses for 2021 and costs
related to the MW Mini MBA, both paid after the end of the year,
and an increase in deferred income mainly due to increased billings
on subscriptions.
MAP23
In January 2021 the Group announced its MAP23 strategy, under
which it will raise Group Adjusted EBITDA margins to 23% (including
the impact of IFRS 16) by 2023, while increasing revenues to
GBP45m. The increase in revenue of 21% and EBITDA margin from 12%
in 2020 to 16% in 2021 demonstrates clear progress towards these
objectives.
The Group has made an encouraging start to 2022 and trading is
in line with our expectations. We are expecting some pressure on
our costs and on retention of employees due to the wider economic
situation in the UK and internationally. We will address this
through structured pricing increases to our customers, robust
negotiation with our suppliers, tight control of our cost base,
variable remuneration structures for our senior management team and
continued work on the social aspects of our ESG agenda as set out
in our ESG report.
Financing and bank covenants
On 16 March 2021 the Group signed a new revolving credit
facility with NatWest that replaces the GBP25m facility signed with
NatWest and Lloyds in 2018. The new facility allows the Group to
borrow up to GBP10m and has a three-year duration with the option
of two further one-year periods. The covenants regarding leverage
and interest cover are identical to those of the facility it
replaces.
Balance sheet
2021 2020
GBPm GBPm
------------------------------------- ----- -----
Goodwill and other intangible assets 44.2 46.1
Property, plant and equipment 2.5 3.3
Deferred taxation 2.4 2.2
Deferred income (7.8) (7.0)
Other current assets and liabilities (7.1) (4.8)
Non-current assets and liabilities (0.2) (0.9)
------------------------------------- ----- -----
Net assets before cash 34.0 38.9
Net cash 13.1 8.3
------------------------------------- ----- -----
Net assets 47.1 47.2
------------------------------------- ----- -----
Goodwill and other intangibles have decreased by GBP1.9m as a
result of the amortisation of intangible assets. Property, plant
and equipment has fallen by GBP0.8m due to the difference between
depreciation and capital expenditure. Deferred income has increased
by GBP0.8m mainly as a result of advance billings on subscriptions.
Other current assets and liabilities have been impacted by an
increase in bonus accruals and cost accruals related to the MW Mini
MBA.
Going concern
After due consideration, as required under IAS 1 Presentation of
Financial Information, including consideration of the Group's net
current liability position, the Group's forecasts for at least
twelve months from the date of this report, and the effectiveness
of risk management processes, the Directors have concluded that it
is appropriate to continue to adopt the going concern basis in the
preparation of the consolidated financial information for the year
ended 31 December 2021. As detailed under the Risk Management
section, the Directors have assessed the viability of the Group
over a three-year period to March 2025 and the Directors have a
reasonable expectation that the Company will be able to continue in
operation and meet its liabilities as they fall due over that
period.
Conclusion
Centaur is well-positioned for growth. The resilience of our
brands during the pandemic, the resultant organic revenue growth
and the increase in profitability delivered in 2021, together with
the strength of our balance sheet, provides persuasive evidence of
the progress that Centaur is making towards its MAP23 goals and
longer-term vision.
Alternative performance measures
Measure Definition
---------------------- ------------------------------------------------------------
Adjusted EBITDA Adjusted operating profit before depreciation and
impairment of tangible assets and amortisation and
impairment of intangible assets other than those acquired
through a business combination.
Adjusted EBITDA margin Adjusted EBITDA as a percentage of revenue.
Adjusted EPS EPS calculated using Adjusted profit for the period.
Adjusting items Items as set out in the statement of consolidated
income and notes 1(b) and 4 of the financial information
including exceptional items, amortisation of acquired
intangible assets, profit/(loss) on disposal of assets,
share-based payment expense, volatile items predominantly
relating to investment activities and other separately
reported items.
Adjusted operating Operating profit excluding Adjusting items.
profit
Adjusted profit before Profit before tax excluding Adjusting items.
tax
Cash conversion Adjusted operating cash flow (excluding any one-off
significant cash flows) / Adjusted EBITDA (including
discontinued operations).
Exceptional items Items where the nature of the item, or its magnitude,
is material and likely to be non-recurring in nature
as shown in note 4.
Free cash flow Increase/decrease in cash for the year before the
impact of debt, acquisitions, disposals, dividends
and share repurchases.
Segment profit Adjusted operating profit of a segment after allocation
of central support teams and overheads that are directly
related to each segment or business unit.
Underlying revenue Statutory revenue adjusted to exclude the impact of
revenue arising from acquired businesses, disposed
businesses that do not meet the definition of discontinued
operations per IFRS 5, and closed business lines ("excluded
revenue").
---------------------- ------------------------------------------------------------
Risk Management
Risk management approach
The Board has overall responsibility for the effectiveness of
the Group's system of risk management and internal controls, and
these are regularly monitored by the Audit Committee.
The Executive Committee, Company Secretary and the Head of Legal
are responsible for identifying, managing and monitoring material
and emerging risks in each area of the business and for regularly
reviewing and updating the risk register, as well as reporting to
the Audit Committee in relation to risks, mitigations and controls.
As the Group operates principally from one office and with
relatively flat management reporting lines, members of the
Executive Committee are closely involved in day-to-day matters and
are able to identify areas of increasing risk quickly and respond
accordingly. The responsibility for each risk identified is
assigned to a member of the Executive Committee. The Audit
Committee considers risk management and controls regularly and the
Board formally considers risks to the Group's strategy and plans as
well as the risk management process as part of its strategic
review.
The risk register is the core element of the Group's risk
management process. The register is maintained by the Company
Secretary with input from the Executive Committee and the Head of
Legal. The Executive Committee initially identifies the material
risks and emerging risks facing the Group and then collectively
assesses the severity of each risk (by ranking both the likelihood
of its occurrence and its potential impact on the business) and the
related mitigating controls.
As part of its risk management processes, the Board considers
both strategic and operational risks, as well as its risk appetite
in terms of the tolerance level it is willing to accept in relation
to each principal risk, which is recorded in the Company's risk
register. This approach recognises that risk cannot always be
eliminated at an acceptable cost and that there are some risks
which the Board will, after due and careful consideration, choose
to accept. The Group's risk register, its method of preparation and
the operation of the key controls in the Group's system of internal
control are regularly reviewed and overseen by the Audit Committee
with reference to the Group's strategic aims and its operating
environment. The register is also reviewed and considered by the
Board.
As part of the ongoing enhancement of the Group's risk
monitoring activities, we reviewed and updated the procedures by
which we evaluate principal risks and uncertainties during the
year.
Principal risks
The Group's risk register currently includes operational and
strategic risks. The principal risks faced by the Group in 2021,
taken from the register, together with the potential effects and
mitigating factors, are set out below. The Directors confirm that
they have undertaken a robust assessment of the principal and
emerging risks facing the Group. Financial risks are shown in note
26 to the financial information.
Rank Risk Description of risk and Risk mitigation/control Movement
impact procedure in risk
---- ------------------------- ----------------------------------- ------------------------------------ ----------
1 Failure to Centaur's success depends There has been a significant The Board
deliver and on growing the business focus on employee communication considers
maintain a and completing the MAP23 this year, including, weekly this risk
high growth strategy. In order to updates, local town hall to have
performance do this, it depends in meetings, monthly all Company increased
culture. large part on its ability Q&A sessions and staff welfare since
The risk that to recruit, motivate calls. the prior
Centaur is and retain highly experienced We regularly review measures year.
unable to attract, and qualified employees aimed at improving our ability
develop and in the face of often to recruit and retain employees.
retain an appropriately intense competition from During the year we have
skilled, diverse other companies, especially focused on bringing in higher
and responsible true in London. quality employees to replace
workforce and Investment in training, leavers or in new roles
leadership development and pay awards in order to enhance our
team, and maintain needs to be compelling strategy particularly in
a healthy culture but will be challenging areas such as digitalisation,
which encourages in the current economic technology and data analytics.
and supports and operating climate. We track employee engagement
ethical high-performance Implementing a diverse through weekly "check-ins"
behaviours and inclusive working via our Engage system to
and decision environment that allows gauge colleague sentiment
making. for agile and remote and gain an understanding
Difficulties delivery is necessary of any key risks or challenges.
in recruiting to keep the workforce Our employee engagement
and retaining engaged. It is also required team, "DICE", who focus
staff could for the transition to on Diversity, Inclusion,
lead to loss a more flexible hybrid Culture and Engagement have
of key senior working model. helped to drive forward
staff. Higher staff churn (a initiatives relating to
challenge for many companies diversity and inclusion,
in our sector) is likely through communication and
to be an important issue virtual social events. This
during 2022 and we will is sponsored by the CEO
need to keep our policies and a Non-Executive Director.
and practices under review. An annual review ensures
Developing the MAP23 flight risks and training
business strategy and needs are identified which
changes required in skill become the focus for pay,
set and culture are challenging reward and development areas.
and costly. All London based staff continue
to be paid at or above the
London Living Wage.
Our HR team hold exit interviews
for all leavers to identify
and resolve areas of concern.
---- ------------------------- ----------------------------------- ------------------------------------ ----------
2 Sensitivity The world economy has Most of the risk impacting The Board
to UK/sector been severely impacted Centaur relates to our customers. considers
economic conditions. by the Covid pandemic The Group has demonstrated this risk
and UK GDP fell significantly that it can mitigate the to be
in 2020.The UK also came risk by increased digitalisation, broadly
to the end of the transition running hybrid events and the same
deal with the EU at the offering eLearning services. as the
end of 2020. Although Centaur plans to increase prior
the UK economy has improved international organic growth year.
during 2021 the Group in the mid to longer term,
continues to have sensitivity focusing on the US and Asia
to UK/sector volatility in particular, to mitigate
and economic conditions. this risk. We are also increasing
The impact was acute our focus on targeting larger
on some of Centaur's scale multinational businesses
target market segments which have a more diversified
including the fashion, risk profile.
retail and entertainment Many of the Group's products
sectors and could also are market-leading in their
have an impact on physical respective sectors and are
events. an integral part of our
The likelihood of ongoing customers' operational processes,
volatility is expected which mitigates the risk
to be high in 2022 including of reduced demand for our
higher inflation rates products.
and there are varying The Group regularly reviews
views as to the timing the political and economic
and extent of a recovery. conditions and forecasts
for the UK, including specific
risks such as inflation,
to assess whether changes
to its product offerings
or pricing structures are
necessary.
---- ------------------------- ----------------------------------- ------------------------------------ ----------
3 Fraudulent Centaur relies on its Appropriate IT security The Board
or accidental IT network to conduct and related controls are considers
breach of our its operations. The IT in place for all key processes this risk
IT network, network is at risk of to keep the IT environment to be
major systems a serious systems failure safe and monitor our network broadly
failure or or breach of its security systems and data. the same
ineffective controls due to a deliberate Centaur has invested significantly as the
operation of or fraudulent cyber-attack in its IT systems and, where prior
IT and data or unintentional event services are outsourced year.
management and may include third-parties to suppliers, contingency
systems leads gaining unauthorised planning is carried out
to loss, theft access to Centaur's IT to mitigate risk of supplier
or misuse of network and systems. failure.
financial assets, This could result in Centaur continues to develop
proprietary misappropriation of its its CRM, e-commerce and
or sensitive financial assets, proprietary finance systems and removed
information or sensitive information a number of legacy systems
and/or inoperative (including personal data following the divestments
core products, or confidential information), in 2019 which has reduced
services, or corruption of data, or the Group's cyber risk.
business functions. operational disruption, Centaur has a business continuity
such as unavailability plan which includes its
of our websites and our IT systems, subject to an
digital products to users, annual failover test, and
unavailability of support there is daily, overnight
platforms and disruption back-up of data, stored
to our revenue collection off-site.
activities. Websites are hosted by specialist
Centaur could incur significant third-party providers who
costs and suffer other typically provide warranties
negative consequences relating to security standards.
as a result of this, All of our websites are
such as remediation costs hosted on a secure platform
(including liability which is cloud hosted and
for stolen assets or databases have been cleansed
information, and repair and updated.
of any damage caused The Group Head of Data ensures
to Centaur's IT network that rigorous controls are
infrastructure and systems) in place to ensure warehouse
as well as reputational data can only be downloaded
damage and loss of investor by the data team. Integration
confidence resulting of the warehouse with current
from any operational databases and data captured
disruption. and stored elsewhere is
A serious occurrence ongoing.
of a loss, theft or misuse Please see risk 4 below
of personal data could for specific mitigations
also result in a breach relating to the security
of data protection requirements of personal data and GDPR
and the effects of this. compliance.
See risk 4: GDPR, PECR
below.
---- ------------------------- ----------------------------------- ------------------------------------ ----------
4 Regulatory The UK General Data Protection Centaur has taken a wide The Board
(GDPR, PECR Regulation ('GDPR'), range of measures aimed considers
and other similar the Data Protection Act at complying with the key this risk
legislation) 2018 ('DPA') and the aspects of the GDPR, DPA to be
involve strict Privacy and Electronic and PECR. broadly
requirements Communications Regulations In 2020, a Data Protection the same
regarding how ('PECR') involve strict Compliance Committee was as the
Centaur handles requirements for Centaur formed (overseen by the prior
personal data, regarding its handling CFO) in order to monitor year.
including that of personal data. Centaur's Centaur's ongoing compliance
of customers. obligations under the with these data protection
There is the GDPR are complex meaning laws.
risk of a fine this area requires ongoing Staff are required to undertake
from the ICO, focus. online data protection awareness
third-party PECR includes specific and data security awareness
claims as well obligations for businesses training annually.
as reputational like Centaur regarding In Q4 2021, Centaur appointed
damage if we electronic marketing a DPO (Wiggin LLP) to oversee
do not comply. calls, emails, texts, its compliance with data
and on their use of cookies protection laws. Further,
and similar technologies, Centaur's in-house lawyer
among other things. keeps abreast of material
In the event of a serious developments in data protection
breach of the GDPR and/or law and regulation and advice
PECR, Centaur could be from external law firms
subject to a significant is sought where appropriate.
fine from the regulator, Given the increasingly global
the ICO, and claims from nature of our business and
third parties including our customers, Centaur's
customers as well as approach to complying with
reputational damage. data protection laws in
The maximum fines for other jurisdictions should
breaches are GBP17.5 be kept under review. In
million (GDPR) and GBP500,000 2020, Centaur implemented
(PECR) respectively and various measures to mitigate
directors can have liability against risk in respect
for serious breaches of the CCPA, a new Californian
of PECR's marketing rules. privacy law, and also appointed
Other countries and jurisdictions an 'EU representative' under
worldwide are reviewing the GDPR ahead of Brexit.
and updating their own
laws relating to data
and privacy. Where Centaur
is required to comply
with the laws in non-UK
jurisdictions there is
a risk that Centaur may
not be compliant with
all such laws and could
therefore be subject
to regulatory action
and fines from the relevant
regulators and data subjects.
The UK's departure from
the EU will have implications
for UK data protection
laws, the impact of which
is not yet clear and
is being kept under review.
ICO guidance relating
to use of cookies, and
further changes to the
laws relating to data
privacy, ad tech and
electronic marketing
expected in the future,
will further increase
the regulatory burden
for businesses like Centaur,
and the requirements
in this regard will need
to be kept under review.
Viability Statement
In accordance with provision 31 of the UK Corporate Governance
Code 2018, the Directors have assessed the viability of the Group
over a three-year period from signing of this Annual Report to
March 2025, taking account of the Group's current position, the
Group's strategy, the Board's risk appetite and, as documented
above, the principal risks facing the Group and how these are
managed. Based on the results of this analysis, the Directors have
a reasonable expectation that the Company will be able to continue
in operation and meet its liabilities as they fall due over the
period to March 2025.
The Board has determined that the three-year period to March
2025 is an appropriate period over which to provide its viability
statement because the Board's financial planning horizon covers a
three-year period. In making their assessment, the Directors have
taken account of the Group's GBP10m three-year revolving credit
facility (which allows extensions to 2026 on similar terms), cash
flows, dividend cover and other key financial ratios over the
period.
The covenants of the facility require a minimum interest cover
ratio of 4, and net leverage not exceeding 2.5 times. In the
calculation of net leverage Adjusted EBITDA excludes the impact of
IFRS 16. The Group is not expected to breach any of these covenants
in any of the scenarios run for the viability statement.
The base scenario uses a three-year forecast to December 2025,
which assumes achievement of MAP23 targets, with 2024 forecast
continuing that strategy. The three months to March 2025 are based
directly off the respective forecast in 2024 with inflation
applied. The MAP23 targets were built, bottom-up during 2020 once
the impact of Covid had become clear. The strategy focuses on
investment and resource allocation on the Flagship 4, the four
brands we consider our key drivers for organic revenue growth.
Further details of the MAP23 plan can be found in the Strategy
section of the 2020 Annual Report.
The metrics in the base case are subject to stress testing which
involves sensitising key assumptions underlying the forecasts both
individually and in unison. The key sensitivity is on Adjusted
EBITDA which is the primary driver of performance in the viability
assessment. This sensitised scenario assume that Adjusted EBITDA is
lowered by 10% in every period that the viability statement
covers.
In both the base case and sensitised scenarios, the Group would
not be required to rely on the revolving credit facility in order
to fund its daily operations. Sensitising the model for changes in
the assumptions and risks affirmed that the Group would remain
viable over the three-year period to March 2025.
Going concern basis of accounting
In accordance with provision 30 of the UK Corporate Governance
Code 2018, the Directors' statement as to whether they consider it
appropriate to adopt the going concern basis of accounting in
preparing the financial information and their identification of any
material uncertainties, including the principal risks outlined
above, to the Group's ability to continue to do so over a period of
at least twelve months from the date of approval of the financial
information and for the foreseeable future, being the period as
discussed in the viability statement above.
Statement of Directors' Responsibilities in respect of the
financial information
The Directors are responsible for preparing the Annual Report
and the financial information in accordance with applicable law and
regulation.
Company law requires the Directors to prepare financial
information for each financial year. On 31 December 2020, IFRS as
adopted by the European Union at that date was brought into UK law
and became UK-adopted International Accounting Standards (IASs),
with future changes being subject to endorsement by the UK
Endorsement Board. Therefore, the Directors have prepared the Group
financial information in accordance with UK-adopted IASs and
Company financial information in accordance with UK-adopted IASs.
Under company law the Directors must not approve the financial
information unless they are satisfied that they give a true and
fair view of the state of affairs of the Group and Company and of
the profit or loss of the Group and Company for that period. In
preparing the financial information, the Directors are required
to:
-- select suitable accounting policies and then apply them consistently;
-- state whether applicable UK-adopted IASs have been followed for the
Group financial information and UK-adopted IASs have been followed
for the Company financial information, subject to any material departures
disclosed and explained in the financial information;
-- make judgements and accounting estimates that are reasonable and prudent;
and
-- prepare the financial information on the going concern basis unless
it is inappropriate to presume that the Group and Company will continue
in business.
The Directors are also responsible for safeguarding the assets
of the Group and Company and hence for taking reasonable steps for
the prevention and detection of fraud and other irregularities.
The Directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the Group and
Company's transactions and disclose with reasonable accuracy at any
time the financial position of the Group and Company and enable
them to ensure that the financial information and the Directors'
Remuneration Report comply with the Companies Act 2006.
The Directors are responsible for the maintenance and integrity
of the Company's website. Legislation in the United Kingdom
governing the preparation and dissemination of financial
information may differ from legislation in other jurisdictions.
Directors' confirmations
The Directors consider that the annual report and accounts,
taken as a whole, is fair, balanced and understandable and provides
the information necessary for shareholders to assess the Group and
Company's position and performance, business model and
strategy.
Each of the Directors, whose names and functions are listed in
the Governance Report confirm that, to the best of their
knowledge:
-- the Company financial information, which has been prepared in accordance
with UK-adopted IASs, gives a true and fair view of the assets, liabilities,
financial position and result of the Company;
-- the Group financial information, which has been prepared in accordance
with UK-adopted IASs, gives a true and fair view of the assets, liabilities,
financial position and profit of the Group; and
-- the Directors' Report includes a fair review of the development and
performance of the business and the position of the Group and Company,
together with a description of the principal risks and uncertainties
that it faces.
In the case of each Director in office at the date the
Directors' Report is approved:
-- so far as the Director is aware, there is no relevant audit information
of which the Group and Company's auditors are unaware; and
-- they have taken all the steps that they ought to have taken as a Director
in order to make themselves aware of any relevant audit information
and to establish that the Group and Company's auditors are aware of
that information.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the year ended 31 December 2021
Adjusted Adjusting Statutory Adjusted Adjusting Statutory
Results(1) Items(1) Results Results(1) Items(1) Results
2021 2021 2021 2020 2020 2020
Note GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------------ ---- ----------- --------- --------- ----------- --------- ---------
Continuing operations
Revenue 2 39,080 - 39,080 32,419 - 32,419
Other operating income - - - 2 - 2
Net operating expenses 3 (35,848) (1,611) (37,459) (32,411) (2,315) (34,726)
------------------------------------------ ---- ----------- --------- --------- ----------- --------- ---------
Operating profit / (loss) 3,232 (1,611) 1,621 10 (2,315) (2,305)
Finance income 1 - 1 6 - 6
Finance costs 6 (261) - (261) (315) - (315)
------------------------------------------ ---- ----------- --------- --------- ----------- --------- ---------
Profit / (loss) before tax 2,972 (1,611) 1,361 (299) (2,315) (2,614)
Taxation 7 (139) 195 56 559 336 895
------------------------------------------ ---- ----------- --------- --------- ----------- --------- ---------
Profit / (loss) for the year from
continuing operations 2,833 (1,416) 1,417 260 (1,979) (1,719)
Discontinued operations
Profit / (loss) for the year from
discontinued operations after tax 8 - - - 112 (12,821) (12,709)
------------------------------------------ ---- ----------- --------- --------- ----------- --------- ---------
Profit / (loss) for the year attributable
to owners of the parent after tax 2,833 (1,416) 1,417 372 (14,800) (14,428)
------------------------------------------ ---- ----------- --------- --------- ----------- --------- ---------
Total comprehensive income / (loss)
attributable to owners of the parent 2,833 (1,416) 1,417 372 (14,800) (14,428)
------------------------------------------ ---- ----------- --------- --------- ----------- --------- ---------
Earnings / (loss) per share attributable
to owners of the parent 9
Basic from continuing operations 2.0p (1.0p) 1.0p 0.2p (1.4p) (1.2p)
Basic from discontinued operations - - - 0.1p (8.9p) (8.8p)
------------------------------------------ ---- ----------- --------- --------- ----------- --------- ---------
Basic from profit / (loss) for the
year 2.0p (1.0p) 1.0p 0.3p (10.3p) (10.0p)
------------------------------------------ ---- ----------- --------- --------- ----------- --------- ---------
Fully diluted from continuing operations 1.9p (1.0p) 0.9p 0.2p (1.4p) (1.2p)
Fully diluted from discontinued
operations - - - 0.1p (8.9p) (8.8p)
------------------------------------------ ---- ----------- --------- --------- ----------- --------- ---------
Fully diluted from profit / (loss)
for the year 1.9p (1.0p) 0.9p 0.3p (10.3p) (10.0p)
------------------------------------------ ---- ----------- --------- --------- ----------- --------- ---------
(1) Adjusted results exclude adjusting items, as detailed in
note 1(b)
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the year ended 31 December 2021
Attributable to owners of the Company
Reserve
for shares
Share Own Share to be Deferred Foreign currency Retained Total
capital shares premium issued shares reserve earnings equity
Note GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------ ----- -------- -------- -------- ----------- -------- ----------------- --------- --------
At 1 January 2020 15,141 (7,243) 1,101 1,770 80 127 50,040 61,016
Loss for the year
and total
comprehensive
loss - - - - - - (14,428) (14,428)
Currency
translation
adjustment - - - - - 39 - 39
Transactions with
owners in their
capacity as
owners:
Exercise of share
awards 22,23 - 1,341 - (749) - - (592) -
Fair value of
employee services 23 - - - 543 - - - 543
Lapsed share
awards 22 - - - (957) - - 957 -
------------------ ----- -------- -------- -------- ----------- -------- ----------------- --------- --------
As at 31 December
2020 15,141 (5,902) 1,101 607 80 166 35,977 47,170
------------------ ----- -------- -------- -------- ----------- -------- ----------------- --------- --------
Profit for the
year and total
comprehensive
income - - - - - - 1,417 1,417
Currency
translation
adjustment - - - - - (23) - (23)
Transactions with
owners in their
capacity as
owners:
Dividends 24 - - - - - - (1,450) (1,450)
Exercise of share
awards 22,23 - 431 - (493) - - (419) (481)
Fair value of
employee services 23 - - - 357 - - - 357
Tax on share-based
payments 14 - - - - - - 118 118
As at 31 December
2021 15,141 (5,471) 1,101 471 80 143 35,643 47,108
------------------ ----- -------- -------- -------- ----------- -------- ----------------- --------- --------
COMPANY STATEMENT OF CHANGES IN EQUITY
for the year ended 31 December 2021
Attributable to owners of the Company
Reserve
for shares
Share Own Share to be Deferred Retained Total
capital shares premium issued shares earnings equity
Note GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------------------------------- ---- -------- -------- -------- ----------- -------- --------- --------
At 1 January 2020 15,141 (6,330) 1,101 1,770 80 15,972 27,734
Profit for the year and total
comprehensive income - - - - - 12,172 12,172
Transactions with owners in their
capacity
as owners:
Transfer of treasury shares 22 - 2,195 - - - (1,591) 604
Exercise of share awards 23 - - - (749) - 246 (503)
Fair value of employee services 23 - - - 543 - - 543
Lapsed share awards 22 - - - (957) - 957 -
-------------------------------------- ---- -------- -------- -------- ----------- -------- --------- --------
As at 31 December 2020 15,141 (4,135) 1,101 607 80 27,756 40,550
-------------------------------------- ---- -------- -------- -------- ----------- -------- --------- --------
Loss for the year and total
comprehensive loss - - - - - (2,325) (2,325)
Transactions with owners in their
capacity as owners:
Dividends 24 - - - - - (1,450) (1,450)
Exercise of share awards 23 - - - (493) - 80 (413)
Fair value of employee services 23 - - - 357 - - 357
Tax on share-based payments 14 - - - - - 88 88
-------------------------------------- ---- -------- -------- -------- ----------- -------- --------- --------
As at 31 December 2021 15,141 (4,135) 1,101 471 80 24,149 36,807
-------------------------------------- ---- -------- -------- -------- ----------- -------- --------- --------
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
as at 31 December 2021
Registered number 04948078
31 December 31 December
2021 2020
Note GBP'000 GBP'000
--------------------------------------------------- ---- ----------- -----------
Non-current assets
Goodwill 10 41,162 41,162
Other intangible assets 11 3,102 4,911
Property, plant and equipment 12 2,484 3,258
Deferred tax assets 14 2,488 2,449
Other receivables 15 319 515
--------------------------------------------------- ---- ----------- -----------
49,555 52,295
--------------------------------------------------- ---- ----------- -----------
Current assets
Trade and other receivables 15 6,059 5,781
Cash and cash equivalents 16 13,065 8,300
Current tax assets 20 195 182
--------------------------------------------------- ---- ----------- -----------
19,319 14,263
--------------------------------------------------- ---- ----------- -----------
Total assets 68,874 66,558
--------------------------------------------------- ---- ----------- -----------
Current liabilities
Trade and other payables 17 (11,405) (8,719)
Bank and other borrowings (3) (7)
Lease liabilities 18 (1,884) (1,969)
Deferred income 19 (7,846) (7,048)
(21,138) (17,743)
--------------------------------------------------- ---- ----------- -----------
Net current liabilities (1,819) (3,480)
--------------------------------------------------- ---- ----------- -----------
Non-current liabilities
Lease liabilities 18 (500) (1,406)
Provisions 21 - -
Deferred tax liabilities 14 (128) (239)
--------------------------------------------------- ---- ----------- -----------
(628) (1,645)
--------------------------------------------------- ---- ----------- -----------
Net assets 47,108 47,170
--------------------------------------------------- ---- ----------- -----------
Capital and reserves attributable to owners of the
Company
Share capital 22 15,141 15,141
Own shares (5,471) (5,902)
Share premium 1,101 1,101
Other reserves 551 687
Foreign currency reserve 143 166
Retained earnings 35,643 35,977
--------------------------------------------------- ---- ----------- -----------
Total equity 47,108 47,170
--------------------------------------------------- ---- ----------- -----------
COMPANY STATEMENT OF FINANCIAL POSITION
as at 31 December 2021
Registered number 04948078
31 December 31 December
2021 2020
Note GBP'000 GBP'000
--------------------------------------------------- ---- ----------- -----------
Non-current assets
Investments 13 65,155 64,992
Deferred tax assets 14 190 68
Other receivables 15 1,197 237
--------------------------------------------------- ---- ----------- -----------
66,542 65,297
--------------------------------------------------- ---- ----------- -----------
Current assets
Trade and other receivables 15 161 35,717
161 35,717
--------------------------------------------------- ---- ----------- -----------
Total assets 66,703 101,014
--------------------------------------------------- ---- ----------- -----------
Current liabilities
Trade and other payables 17 (29,893) (60,457)
Bank and other borrowings (3) (7)
--------------------------------------------------- ---- ----------- -----------
(29,896) (60,464)
--------------------------------------------------- ---- ----------- -----------
Net current liabilities (29,735) (24,747)
--------------------------------------------------- ---- ----------- -----------
Net assets 36,807 40,550
--------------------------------------------------- ---- ----------- -----------
Capital and reserves attributable to owners of the
Company
Share capital 22 15,141 15,141
Own shares (4,135) (4,135)
Share premium 1,101 1,101
Other reserves 551 687
Retained earnings 24,149 27,756
--------------------------------------------------- ---- ----------- -----------
Total equity 36,807 40,550
--------------------------------------------------- ---- ----------- -----------
The Company has taken advantage of the exemption available under
section 408 of the Companies Act 2006 and has not presented its own
statement of comprehensive income in this financial information.
The Company's loss for the year was GBP2,325,000 (2020: profit of
GBP12,172,000). Dividends of GBP1,450,000 were paid in the year
(2020: GBPnil). The other movements in retained earnings are shown
in the Company's statement of changes in equity.
CONSOLIDATED CASH FLOW STATEMENT
for the year ended 31 December 2021
2021 2020
Note GBP'000 GBP'000
-------------------------------------------------------- ---- -------- --------
Cash flows from operating activities
Cash generated from operations 25 9,521 2,065
Tax refund - (9)
-------------------------------------------------------- ---- -------- --------
Net cash generated from operating activities 9,521 2,056
-------------------------------------------------------- ---- -------- --------
Cash flows from investing activities
Directly attributable costs of disposal of subsidiaries - (85)
Proceeds from disposal of intangible assets 11 - 150
Purchase of property, plant and equipment 12 (51) (223)
Purchase of intangible assets 11 (706) (597)
Net cash flows used in investing activities (757) (755)
-------------------------------------------------------- ---- -------- --------
Cash flows from financing activities
Purchase of own shares 22 (306) -
Loan arrangement fees 25 (107) (25)
Interest paid 25 (87) (130)
Repayment of obligations under lease arrangements 18 (2,036) (1,925)
Termination of finance lease 18 - (200)
Dividends paid to Company's shareholders 24 (1,448) -
Net cash flows used in financing activities (3,984) (2,280)
-------------------------------------------------------- ---- -------- --------
Net increase / (decrease) in cash and cash equivalents 4,780 (979)
Cash and cash equivalents at beginning of the year 8,300 9,274
Effects of foreign currency exchange rate changes (15) 5
-------------------------------------------------------- ---- -------- --------
Cash and cash equivalents at end of year 16 13,065 8,300
-------------------------------------------------------- ---- -------- --------
COMPANY CASH FLOW STATEMENT
for the year ended 31 December 2021
2021 2020
Note GBP'000 GBP'000
--------------------------------------------------- ---- -------- --------
Cash flows from operating activities
Cash generated from operating activities 25 1,642 155
--------------------------------------------------- ---- -------- --------
Cash flows from investing activities
Net cash flows used in investing activities - -
--------------------------------------------------- ---- -------- --------
Cash flows from financing activities
Interest paid 25 (87) (130)
Loan arrangement fees 25 (107) (25)
Dividends paid to Company's shareholders 24 (1,448) -
--------------------------------------------------- ---- -------- --------
Net cash flows used in financing activities (1,642) (155)
--------------------------------------------------- ---- -------- --------
Net increase in cash and cash equivalents - -
Cash and cash equivalents at beginning of the year - -
--------------------------------------------------- ---- -------- --------
Cash and cash equivalents at end of year 16 - -
--------------------------------------------------- ---- -------- --------
NOTES TO THE FINANCIAL INFORMATION
1 Summary of significant accounting policies
The principal accounting policies adopted in the preparation of
these consolidated and Company financial information is set out
below. These policies have been consistently applied to all the
periods presented, unless otherwise stated. The financial
information is for the Group consisting of Centaur Media Plc and
its subsidiaries, and the Company, Centaur Media Plc. Centaur Media
Plc is a public company limited by shares and incorporated in
England and Wales.
(a) Basis of preparation
The financial information in this preliminary announcement has
been extracted from the audited Group Financial Statements for the
year ended 31 December 2021 and does not constitute statutory
accounts within the meaning of section 434 of the Companies Act
2006. The Group Financial Statements for 2020 were delivered to the
registrar of companies, and those for 2021 will be delivered in due
course. The auditor's report on the Group Financial Statements for
2020 and 2021 were both unqualified and unmodified. The auditors'
report was signed on 15 March 2022. The Group Financial Statements
and this preliminary announcement were approved by the Board of
Directors on 15 March 2022.
On 31 December 2020, IFRS as adopted by the European Union at
that date was brought into UK law and became UK-adopted
International Accounting Standards, with future changes being
subject to endorsement by the UK Endorsement Board. Centaur Media
Plc transitioned to UK-adopted International Accounting Standards
in its consolidated and Company financial information on 1 January
2021. This change constitutes a change in accounting framework.
However, there is no impact on recognition, measurement or
disclosure in the year reported as a result of the change in
framework. The consolidated and Company financial information has
been prepared in accordance with UK-adopted International
Accounting Standards and with the requirements of the Companies Act
2006 as applicable to companies reporting under those standards.
The financial information has been prepared on a historical cost
basis except where stated otherwise within the accounting
policies.
Going concern
The financial information has been prepared on a going concern
basis. The Directors have carefully assessed the Group's ability to
continue trading and have a reasonable expectation that the Group
and Company have adequate resources to continue in operational
existence for at least twelve months from the date of approval of
this financial information and for the foreseeable future, being
the period in the viability statement.
Net cash (see note 1(b)) at 31 December 2021 amounted to
GBP13,065,000 (2020: GBP8,300,000). On 16 March 2021, the Group
signed a new multi-currency revolving credit facility with NatWest.
The new revolving credit facility consists of a committed GBP10m
facility and an additional uncommitted GBP15m accordion option,
both of which can be used to cover the Group's working capital and
general corporate needs. The facility runs to March 2024 with the
option to extend for two periods of one year each. None of this was
drawn down at 31 December 2021. The covenants regarding leverage
and interest cover are identical to those of the facility it
replaces.
The Group has net current liabilities at 31 December 2021
amounting to GBP1,819,000 (2020: GBP3,480,000). In both the current
and prior year these primarily arose from its normal high levels of
deferred income relating to performance obligations to be delivered
in the future rather than an inability to service its liabilities,
as deferred income will not result in a cash outflow. An assessment
of cash flows for the next three financial years, which has taken
into account the factors described above, has indicated an expected
level of cash generation which would be sufficient to allow the
Group to fully satisfy its working capital requirements and the
guarantee given in respect of its UK subsidiaries, to cover all
principal areas of expenditure, including maintenance, capital
expenditure and taxation during this year, and to meet the
financial covenants under the revolving credit facility. The
Company has net current liabilities at 31 December 2021 amounting
to GBP29,735,000 (2020: GBP24,747,000). In both the current and
prior year, these almost entirely arose from unsecured payables to
subsidiaries which have no fixed date of repayment.
The preparation of financial information in accordance with IFRS
requires the use of estimates and assumptions that affect the
reported amounts of assets and liabilities at the date of the
financial information and the reported amounts of revenues and
expenses during the year. Although these estimates are based on
management's best knowledge of the amount, events or actions, the
actual results may ultimately differ from those estimates.
Having assessed the principal risks and the other matters
discussed in connection with the Viability Statement which
considers the Group's viability over a three-year period to March
2025, the Directors consider it appropriate to adopt the going
concern basis of accounting in preparing its consolidated financial
information.
New and amended standards adopted by the Group
No new standards or amendments to standards that are mandatory
for the first time for the financial year commencing 1 January 2021
affected any of the amounts recognised in the current year or any
prior year and is not likely to affect future periods.
New standards and interpretations not yet adopted
There are no standards that are not yet effective and that would
be expected to have a material impact on the entity in the current
or future reporting periods and on foreseeable future
transactions.
Prior year re-presentation
The financial information has been presented in GBP'000. This is
a change from the prior year financial information which was
presented in GBPm rounded to one decimal place. Prior year
comparatives have been re-presented in GBP'000. Certain prior year
comparatives have been updated following this change.
Comparative numbers
Prior year comparative numbers have been updated to reflect
current year presentation and disclosures. A portion of costs
previously presented as administrative expenses have now been
allocated to cost of sales, an update to reflect the same
allocation basis as the current year. The allocation basis has been
refined to reflect the nature of the costs. These reallocations
increased cost of sales by GBP1,946,000 and decreased
administrative expenses by GBP1,946,000 for the Group, refer to
note 3. There is no impact on the face of the consolidated
statement of comprehensive income.
(b) Presentation of non-statutory measures
In addition to IFRS statutory measures, the Directors use
various non-GAAP key financial measures to evaluate the Group's
performance and consider that presentation of these measures
provides shareholders with an additional understanding of the core
trading performance of the Group. The measures used are explained
and reconciled to their IFRS statutory headings below.
Adjusted operating profit and adjusted earnings per share
The Directors believe that adjusted results and adjusted
earnings per share, split between continuing and discontinued
operations, provide additional useful information on the core
operational performance of the Group to shareholders, and review
the results of the Group on an adjusted basis internally. The term
'adjusted' is not a defined term under IFRS and may not therefore
be comparable with similarly titled profit measurements reported by
other companies. It is not intended to be a substitute for, or
superior to, IFRS measurements of profit.
Adjustments are made in respect of:
-- Exceptional items - the Group considers items of income and expense as
exceptional and excludes them from the adjusted results where the nature
of the item, or its magnitude, is material and likely to be non-recurring
in nature so as to assist the user of the financial information to better
understand the results of the core operations of the Group. Details of
exceptional items are shown in note 4.
-- Amortisation of acquired intangible assets - the amortisation charge
for those intangible assets recognised on business combinations is excluded
from the adjusted results of the Group since they are non-cash charges
arising from investment activities. As such, they are not considered
reflective of the core trading performance of the Group. Details of amortisation
of acquired intangible assets are shown in note 11.
-- Share-based payments - share-based payment expenses or credits are excluded
from the adjusted results of the Group as the Directors believe that
the volatility of these charges can distort the user's view of the core
trading performance of the Group. Details of share-based payments are
shown in note 23.
-- Impairment of goodwill - the Directors believe that non-cash impairment
charges in relation to goodwill are triggered by factors external to
the core trading of the business, and therefore exclude any such charges
from the adjusted results of the Group. Details of the goodwill impairment
analysis are shown in note 10.
-- Profit or loss on disposal of assets or subsidiaries - profit or loss
on disposals of businesses are excluded from adjusted results of the
Group as they are unrelated to core trading and can distort a user's
understanding of the performance of the Group due to their infrequent
and volatile nature. See note 4.
-- Other separately reported items - certain other items are excluded from
adjusted results where they are considered large or unusual enough to
distort the comparability of core trading results year-on-year. Details
of these separately disclosed items are shown in note 4.
The tax related to adjusting items is the tax effect of the
items above that are allowable deductions for tax purposes,
calculated using the standard rate of corporation tax. See note 7
for a reconciliation between reported and adjusted tax charges.
Further details of adjusting items are included in note 4. A
reconciliation between adjusted and statutory earnings per share
measures is shown in note 9.
Profit / (loss) before tax reconciles to adjusted operating
profit as follows:
2021 2020
Note GBP'000 GBP'000
-------------------------------------------- -------- -------- --------
Profit / (loss) before tax 1,361 (2,614)
Adjusting items
Exceptional operating costs 4 - 238
Amortisation of acquired intangible assets 11 1,091 1,464
Impairment of acquired intangible assets 11 25 -
Share-based payment expense 23 495 541
Loss on disposal assets and liabilities 11,12,18 - 72
--------------------------------------------- -------- -------- --------
Adjusted profit / (loss) before tax 2,972 (299)
Finance income (1) (6)
Finance costs 6 261 315
--------------------------------------------- -------- -------- --------
Adjusted operating profit 3,232 10
--------------------------------------------- -------- -------- --------
Adjusted operating cash flow
Adjusted operating cash flow is not a measure defined by IFRS.
It is defined as cash flow from operations excluding the impact of
adjusting items, which are defined above, and including capital
expenditure. The Directors use this measure to assess the
performance of the Group as it excludes volatile items not related
to the core trading of the Group and includes the Group's
management of capital expenditure. Statutory cash flow from
operations reconciles to adjusted operating cash as below:
2021 2020
Note GBP'000 GBP'000
--------------------------------------------- ---- -------- --------
Reported cash flow from operating activities 25 9,521 2,065
Adjusting items from operations - 1,063
Working capital impact of adjusting items
from operations - 3,450
---------------------------------------------- ---- -------- --------
Adjusted operating cash flow 9,521 6,578
Capital expenditure (757) (820)
---------------------------------------------- ---- -------- --------
Post capital expenditure cash flow 8,764 5,758
---------------------------------------------- ---- -------- --------
Our cash conversion rate for the year was 164% (2020: 100%).
Underlying revenue growth
The Directors review underlying revenue growth in order to allow
a like-for-like comparison of revenues between years. Underlying
revenues therefore exclude the impact of revenue contribution
arising from acquired or disposed businesses and other revenue
streams that are not expected to be ongoing in future years.
Statutory revenue growth reconciles to underlying revenue growth as
follows:
Xeim The Lawyer Total
GBP'000 GBP'000 GBP'000
-------------------------- -------- ---------- --------
Reported revenue 2020 26,053 6,366 32,419
Underlying revenue 2020 26,053 6,366 32,419
-------------------------- -------- ---------- --------
Reported revenue 2021 32,108 6,972 39,080
-------------------------- -------- ---------- --------
Underlying revenue 2021 32,108 6,972 39,080
-------------------------- -------- ---------- --------
Reported revenue growth 23% 9% 21%
-------------------------- -------- ---------- --------
Underlying revenue growth 23% 9% 21%
-------------------------- -------- ---------- --------
Adjusted EBITDA
Adjusted EBITDA is not a measure defined by IFRS. It is defined
as adjusted operating profit before depreciation and impairment of
tangible assets and amortisation and impairment of intangible
assets other than those acquired through a business combination. It
is used by the Directors as a measure to review performance of the
Group and forms the basis of some of the Group's financial
covenants under its revolving credit facility. Adjusted EBITDA is
calculated as follows:
2021 2020
Note GBP'000 GBP'000
---------------------------------------------- ---- -------- ---------
Adjusted operating profit (as above) 3,232 10
Depreciation of property, plant and equipment 12 1,808 1,992
Amortisation of computer software 11 1,335 1,816
Impairment of computer software 11 55 -
----------------------------------------------- ---- -------- ---------
Adjusted EBITDA 6,430 3,818
----------------------------------------------- ---- -------- ---------
Net cash / (debt)
Net cash/(debt) is not a measure defined by IFRS. Net
cash/(debt) is calculated as cash less overdrafts and bank
borrowings under the Group's financing arrangements. The Directors
consider the measure useful as it gives greater clarity over the
Group's liquidity as a whole. Net cash is GBP13,062,000 as at 31
December 2021 (2020: GBP8,293,000).
(c) Principles of consolidation
The consolidated financial information incorporates the
financial information of Centaur Media Plc and all of its
subsidiaries after elimination of intercompany transactions and
balances.
(i) Subsidiaries
Subsidiaries are all entities controlled by the Group. The Group
controls an entity when the Group is exposed to, or has rights to,
variable returns from its involvement with the entity and has the
ability to affect those returns through its power to direct the
activities of the entity. Subsidiaries are fully consolidated from
the date on which control is transferred to the Group until the
date that the Group ceases to control them. In the consolidated
statement of comprehensive income, the results of subsidiaries for
which control has ceased are presented separately as discontinued
operations in the year in which they have been disposed of and in
the comparative year.
On the disposal of a subsidiary, assets and liabilities of that
subsidiary are de-recognised from the consolidated statement of
financial position, earnings up to the date of loss of control are
retained in the Group, and a profit/(loss) on disposal is
recognised, measured as consideration received less the fair value
of assets and liabilities disposed of.
Intercompany transactions, balances and unrealised gains on
transactions between Group companies are eliminated. The accounting
policies of subsidiaries are consistent with the policies adopted
by the Group.
(ii) Employee Benefit Trust
The Centaur Employees' Benefit Trust ('Employee Benefit Trust')
is a trust established by Trust deed in 2006 for the granting of
shares to applicable employees. Its assets and liabilities are held
separately from the Company and are fully consolidated in the
consolidated statement of financial position. Holdings of Centaur
Media Plc shares by the Employee Benefit Trust are shown within the
'own shares' reserve as a deduction from consolidated equity.
(d) Foreign currency translation
(i) Functional and presentation currency
Items included in the financial information of each of the
Group's entities are measured using the currency of the primary
economic environment in which the entity operates ('the functional
currency'). The consolidated financial information are presented in
Pounds Sterling, which is the Group and Company's functional and
presentation currency.
(ii) Transactions and balances
Foreign currency transactions are translated into the functional
currency using the exchange rates at the dates of the transactions.
Foreign exchange gains and losses resulting from the settlement of
such transactions and from the translation of monetary assets and
liabilities denominated in foreign currencies at year end exchange
rates are recognised in the consolidated statement of comprehensive
income.
(iii) Group companies
The results and financial position of the Group entities that
have a functional currency different from the presentation
currency, as disclosed in note 13, are translated into the
presentation currency as follows:
-- assets and liabilities for each statement of financial position presented
are translated at the closing rate at the reporting date;
-- income and expenses for each statement of comprehensive income are translated
at average exchange rates (unless this average is not a reasonable approximation
of the cumulative effect of the rates prevailing on the transaction dates,
in which case income and expenses are translated at the rate on the dates
of the transactions); and
-- all resulting exchange differences are recognised in other comprehensive
income.
On consolidation, exchange differences arising from the
translation of the net investment in foreign operations and of
borrowings are recognised in other comprehensive income. When a
foreign operation is sold, exchange differences that were recorded
in equity are recognised in the consolidated statement of
comprehensive income as part of the gain or loss on sale.
Goodwill and fair value adjustments arising on the acquisition
of a foreign entity are treated as assets and liabilities of the
foreign entity and translated at the closing rate.
(e) Revenue recognition
Revenue is measured at the transaction price, which is the
amount of consideration to which the Group expects to be entitled
in exchange for transferring promised goods or services to the
customer. Judgement may arise in timing and allocation of
transaction price when there are multiple performance obligations
in one contract. However, an annual impact assessment is performed
which has confirmed that the impact is immaterial in both the
current year and comparative year. Revenue arises from the sales of
premium content, marketing services, training and advisory, events,
marketing solutions, recruitment advertising, and telemarketing
services in the normal course of business, net of discounts and
value added tax. Goods and services exchanged as part of a barter
transaction are recognised in revenue at the fair value of the
goods and services provided. Returns, refunds and other similar
allowances, which have historically been low in volume and
immaterial in magnitude, are accounted for as a reduction in
revenue as they arise.
Where revenue is deferred it is held as a balance in deferred
income on the consolidated statement of financial position. At any
given reporting date, this deferred income is current in nature and
is expected to be recognised wholly in revenue in the following
financial year, with the exception of returns and credit notes,
which have historically been low in volume and immaterial in
magnitude.
The Group recognises revenue earned from contracts as individual
performance obligations are met, on a stand-alone selling price
basis. This is when value and control of the product or service has
transferred, being when the product is delivered to the customer or
the period in which the services are rendered as set out in more
detail below.
Premium Content
Revenue from subscriptions is deferred and recognised on a
straight-line basis over the subscription period, reflecting the
continuous provision of paid content services over this time.
Revenue from individual publication sales is recognised at the
point at which the publication is delivered to the customer. In
general, the Group bills customers for premium content at the start
of the contract.
Marketing Services
Revenue from campaign work and consultancy contracts is
recognised when the Group has obtained the right to consideration
in exchange for its performance, which is when a separately
identifiable phase (milestone) of a contract has been completed and
the value and benefit of the services rendered have been
transferred to the customer. In general, the Group bills customers
for marketing services up front on a milestone basis.
Training and Advisory
Revenue from training and advisory is deferred and recognised
over the period of the training or when a separately identifiable
milestone of a contract has been delivered to the customer. In
general, the Group bills customers for training and advisory up
front or on a milestone basis as the service is delivered.
Events
Consideration received in advance for events is deferred and
revenue is recognised at the point in time at which the event takes
place. In general, the Group bills customers for events before the
event date.
Marketing Solutions
Marketing solutions revenue from display and bespoke campaigns
is recognised over the period that the service is provided. In
general, the Group bills customers for marketing solutions on
delivery.
Recruitment Advertising
Sales of online recruitment advertising space are recognised in
revenue over the period during which the advertisements are placed.
Sales of recruitment advertising space in publications are
recognised at the point at which the publication occurs. In
general, the Group bills customers for recruitment advertising on
delivery.
Telemarketing Services
Revenue from telemarketing services was deferred and recognised
over the period that the service was delivered, generally according
to the number of hours expended as a proportion of the total hours
contracted. In general, the Group billed customers for
telemarketing services in advance. All revenue from telemarketing
services ceased during the prior year following the closure of the
MarketMakers' telemarketing business in August 2020 and is
therefore presented within discontinued operations in the prior
year.
(f) Government grants
Grants from the government are recognised at their fair value
where there is a reasonable assurance that the grant will be
received, and the Group will comply with all attached conditions.
Government grants are recognised in the profit or loss and deducted
from the related expense within net operating expenses in the
consolidated statement of comprehensive income. Note 3 provides
further information on how the Group accounts for government
grants.
(g) Investments
In the Company's financial information, investments in
subsidiaries are stated at cost less provision for impairment in
value.
Investments are reviewed for impairment whenever events indicate
that the carrying value may not be recoverable. An impairment loss
is recognised to the extent that the carrying value exceeds the
higher of the investments fair value less cost of disposal and its
value-in-use. An asset's value-in-use is calculated by discounting
an estimate of future cash flows by the pre-tax weighted average
cost of capital. Any impairment is recognised in the statement of
comprehensive income. If there has been a change in the estimates
used to determine the investment's recoverable amount, impairment
losses that have been recognised in prior periods may be reversed.
This reversal is recognised in the statement of comprehensive
income.
(h) Income tax
The tax expense represents the sum of current and deferred
tax.
Current tax is based on the taxable profit for the year. Taxable
profit differs from profit as reported in the consolidated
statement of comprehensive income because it excludes items of
income or expense that are taxable or deductible in other years,
and it further includes items that are never taxable or deductible.
The Group and Company's liability for current tax is calculated
using tax rates that have been enacted or substantively enacted by
the reporting date.
Deferred tax is provided in full, using the liability method, on
temporary differences between the carrying amounts of assets and
liabilities in the consolidated financial information and the
corresponding tax bases used in the computation of taxable profit.
Deferred tax liabilities are generally recognised for all taxable
temporary differences and deferred tax assets are recognised to the
extent that it is probable that taxable profits will be available
to utilise those temporary differences and losses. Such assets and
liabilities are not recognised if the temporary difference arises
from goodwill or the initial recognition (other than in a business
combination) of other assets and liabilities in a transaction that
affects neither the tax profit nor the accounting profit.
Deferred tax is calculated at the enacted or substantively
enacted tax rates that are expected to apply in the year when the
liability is settled, or the asset is realised. Deferred tax is
charged or credited to the consolidated statement of comprehensive
income, except when it relates to items charged or credited
directly to equity or other comprehensive income, in which case the
deferred tax is recognised in equity or other comprehensive income
respectively.
The carrying amount of deferred tax assets is reviewed at each
reporting date and is reduced to the extent that it is no longer
probable that sufficient taxable profits will be available to allow
all or part of the asset to be recovered.
(i) Leases
Lessee accounting
Under IFRS 16, leases are accounted for on a 'right-of-use
model' reflecting that, at the commencement date, the Group as a
lessee has a financial obligation to make lease payments to the
lessor for its right to use the underlying asset during the lease
term. The financial obligation is recognised as a lease liability,
and the right to use the underlying asset is recognised as a
right-of-use ('ROU') asset. The ROU assets are recognised within
property, plant and equipment on the face of the consolidated
statement of financial position and are presented separately in
note 12.
The lease liability is initially measured at the present value
of the lease payments using the rate implicit in the lease or,
where that cannot be readily determined, the incremental borrowing
rate. Subsequently, the lease liability is measured at amortised
cost, with interest increasing the carrying amount and lease
payments reducing the carrying amount. The carrying amount is
remeasured to reflect any reassessment or lease modifications, or
to reflect revised in-substance fixed lease payments.
The ROU asset is initially measured at cost which comprises:
-- the amount of the initial measurement of the lease liability;
-- any lease payments made at or before the commencement date, less
any lease incentives received;
-- any initial direct costs; and
-- an estimate of costs to be incurred at the end of the lease term.
Subsequently, the ROU asset is measured at cost less accumulated
depreciation and impairment losses. Depreciation is calculated to
write off the cost on a straight-line basis over the lease
term.
Using the exemption available under IFRS 16, the Group elects
not to apply the requirements above to:
-- Short-term leases; and
-- Leases for which the underlying asset is of a low value.
In these cases, the Group recognises the lease payments as an
expense on a straight-line basis over the lease term, or another
systematic basis if that basis is more representative of the
agreement.
Lessor accounting
The Group had contracts for the sub-lease of areas of its former
office property lease. These arrangements were exempt from the
requirements of IFRS 16 under the short-term lease exemption as
they all had a lease term of under twelve months from the date of
transition. As such, the income derived from these sub-leasing
arrangements was recognised on a straight-line basis and was
presented in the consolidated statement of comprehensive income in
'other operating income'. All arrangements in which the Group acted
as a lessor ceased during the prior year.
(j) Impairment of assets
Assets that are subject to depreciation or amortisation are
reviewed for impairment whenever events indicate that the carrying
value may not be recoverable. An impairment loss is recognised to
the extent that the carrying value exceeds the higher of the
asset's fair value less cost of disposal and its value-in-use. An
asset's value-in-use is calculated by discounting an estimate of
future cash flows by the pre-tax weighted average cost of
capital.
(k) Inventories
Inventories are stated at the lower of cost and net realisable
value. Work in progress comprises costs incurred relating to
publications and exhibitions prior to the publication date or the
date of the event. Cost is measured as all costs of purchase and
other costs incurred in bringing the inventories to their present
location and condition.
(l) Property, plant and equipment
See note 1(i) for right-of-use assets. All other property, plant
and equipment is stated at historical cost less accumulated
depreciation and impairment losses. The historical cost of
property, plant and equipment is the purchase cost together with
any incidental direct costs of acquisition. Depreciation is
calculated to write off the cost, less estimated residual value, of
assets, on a straight-line basis over the expected useful economic
lives to the Group over the following periods:
Leasehold improvements - 10 years or the expected length of the lease
if shorter
Fixtures and fittings - 5 to 10 years
Computer equipment - 3 to 5 years
Right-of-use assets - over the lease term
The estimated useful lives, residual values and depreciation
methods are reviewed at the end of each reporting year, with the
effect of any changes in estimate accounted for on a prospective
basis.
(m) Intangible assets
(i) Goodwill
Where the cost of a business acquisition exceeds the fair values
attributable to the separable net assets acquired, the resulting
goodwill is capitalised and allocated to the cash generating unit
('CGU') or groups of CGUs that are expected to benefit from the
synergies of the business combination. Goodwill has an indefinite
useful life and is tested for impairment annually on a Group level
or whenever events or changes in circumstances indicate that the
carrying amount may not be recoverable.
Each segment is deemed to be a CGU. Goodwill and acquired
intangible assets are assessed for impairment in accordance with
IAS 36 'Impairment of Assets'. In assessing whether a write-down of
goodwill and acquired intangible assets is required, the carrying
value of the segment is compared with its recoverable amount.
Recoverable amount is measured as the higher of fair value less
cost of disposal and value-in-use. Any impairment is recognised in
the consolidated statement of comprehensive income (in net
operating expenses) and is classified as an adjusting item.
Impairment of goodwill is not subsequently reversed.
On the disposal of a CGU, the attributable amount of goodwill is
included in the determination of the profit or loss on
disposal.
(ii) Brands and publishing rights and customer relationships
Separately acquired brands and publishing rights are shown at
historical cost. Brands and publishing rights and customer
relationships acquired in a business combination are recognised at
fair value at the acquisition date. They have a finite useful life
and are subsequently carried at cost less accumulated amortisation
and impairment losses.
(iii) Software
Computer software that is not integral to the operation of the
related hardware is carried at cost less accumulated amortisation.
Costs associated with the development of identifiable and unique
software products controlled by the Group that will generate
probable future economic benefits in excess of costs are recognised
as intangible assets when the criteria of IAS 38 'Intangible
Assets' are met. They are carried at cost less accumulated
amortisation and impairment losses.
(iv) Amortisation methods and periods
Amortisation is calculated to write off the cost or fair value
of intangible assets on a straight-line basis over the expected
useful economic lives to the Group over the following periods:
Computer software - 3 to 5 years
Brands and publishing rights - 5 to 20 years
Customer relationships - 3 to 10 years or over the term of any specified
contract
Separately acquired websites - 3 to 5 years
and content
(n) Employee benefits
(i) Post-employment obligations
The Group and Company contribute to a defined contribution
pension scheme for the benefit of employees. The assets of the
scheme are held separately from those of the Group in an
independently administered fund. Contributions to defined
contribution schemes are charged to the statement of comprehensive
income in net operating expenses when employer contributions become
payable.
(ii) Share-based payments
The Group operates a number of equity-settled share-based
compensation plans for its employees. The fair value of the
share-based compensation expense is estimated using either a Monte
Carlo (stochastic model) or Black-Scholes option pricing model and
is recognised in the consolidated statement of comprehensive income
over the vesting period with a corresponding increase in equity.
The total amount to be expensed is determined by reference to the
fair value of the awards granted:
-- including any market performance conditions;
-- excluding the impact of any service and non-market performance vesting
conditions (for example, profitability, sales growth targets, cash flow
performance and remaining an employee of the entity over a specified
time period); and
-- including the impact of any non-vesting conditions (for example, the
requirement for employees to save).
The total expense is recognised over the vesting period, which
is the period over which all of the specified vesting conditions
are to be satisfied. At the end of each reporting year, the Group
revises its estimates of the number of options that are expected to
vest based on the non-market vesting and service conditions. It
recognises the impact of the revision to original estimates, if
any, in the consolidated statement of comprehensive income, with a
corresponding adjustment to equity. The Company issues new shares
or transfers shares from treasury shares to settle share-based
compensation awards.
The award by the Company of share-based compensation awards over
its equity instruments to the employees of subsidiary undertakings
in the Group is treated as a capital contribution only if it is
left unsettled. The fair value of employee services received,
measured by reference to the grant date fair value, is recognised
over the vesting period as an increase to investment in subsidiary
undertakings, with a corresponding credit to equity.
A deferred tax asset is recognised on share options based on the
intrinsic value of the options, which is calculated as the
difference between the fair value of the shares under option at the
reporting date and exercise price of the share options. The
deferred tax asset is utilised when the share options are exercised
or released when share options lapse. The accounting policy
regarding deferred tax is set out above in note 1(h).
(o) Provisions
Provisions are recognised when the Group has a present
obligation (legal or constructive) as a result of a past event, it
is probable that an outflow of resources will be required to settle
the obligation and the obligation can be reliably estimated.
(p) Equity
(i) Share capital and share premium
Ordinary and deferred shares are classified as equity. The
excess of consideration received in respect of shares issued over
the nominal value of those shares is recognised in the share
premium account. Incremental costs directly attributable to the
issue of new shares or options are shown in equity as a deduction,
net of tax, from the proceeds.
Where any Group company purchases the Company's equity
instruments, for example as the result of a share buyback or
share-based payment plan, the consideration paid, including any
directly attributable incremental costs (net of income taxes) is
deducted from equity attributable to the owners of the Company as
treasury shares until the shares are cancelled or reissued. Where
such ordinary shares are subsequently reissued, any consideration
received, net of any directly attributable incremental transaction
costs and the related income tax effects, is included in equity
attributable to the owners of the Company.
Shares held by the Employee Benefit Trust are disclosed as own
shares and deducted from equity.
(ii) Own shares
Own shares consist of treasury shares and shares held within the
Employee Benefit Trust.
Own shares are recognised at cost as a deduction from equity
shareholders' funds. Subsequent consideration received for the sale
of such shares is also recognised in equity, with any excess of
consideration received between the sale proceeds and the original
cost being recognised in share premium. No gain or loss is
recognised in the financial information on transactions in treasury
shares.
(q) Dividends
Dividends are recognised in the year in which they are paid or,
in respect of the Company's final dividend for the year, approved
by the shareholders in the Annual General Meeting.
(r) Segmental reporting
Operating segments are reported in a manner consistent with the
internal reporting provided to the chief operating decision-maker.
The Executive Committee has been identified as the chief operating
decision-maker, reviewing the Group's internal reporting on a
monthly basis in order to assess performance and allocate
resources. Refer to note 2 for the basis of segmentation.
(s) Financial instruments
The Group has applied IFRS 9 'Financial Instruments' as outlined
below:
(i) Financial assets
The Group classifies and measures its financial assets in line
with one of the three measurement models under IFRS 9: at amortised
cost, fair value through profit or loss, and fair value through
other comprehensive income. Management determines the
classification of its financial assets based on the requirements of
IFRS 9 at initial recognition.
They are included in current assets, except for maturities
greater than 12 months after the reporting date. These are
classified as non-current assets. The Group's financial assets
comprise trade and other receivables and cash and cash equivalents
in the consolidated statement of financial position. Please see the
following sections.
(ii) Trade receivables
Trade receivables are accounted for under IFRS 9, being
recognised initially at fair value and subsequently at amortised
cost less any allowance for expected lifetime credit losses under
the 'expected credit loss' model. As mandated by IFRS 9, the
expected lifetime credit losses are calculated using the
'simplified' approach.
A provision matrix is used to calculate the allowance for
expected lifetime credit losses on trade receivables which is based
on historical default rates over the expected life of the trade
receivables and is adjusted for forward-looking estimates. The
allowance for expected lifetime credit losses is established by
considering, on a discounted basis, the cash shortfalls it would
incur in various default scenarios for prescribed future periods
and multiplying those shortfalls by the probability of each
scenario occurring. The historical loss rates are adjusted to
reflect current and forward-looking information on macroeconomic
factors affecting the ability of the customers to settle the
receivables. The allowance is the sum of these probability weighted
outcomes. The allowance and any changes to it are recognised in the
consolidated statement of comprehensive income within net operating
expenses. When a trade receivable is uncollectible, it is written
off against the allowance account for trade receivables. Subsequent
recoveries of amounts previously written off are credited against
net operating expenses in the consolidated statement of
comprehensive income. The Group defines a default as failure of a
debtor to repay an amount due as this is the time at which our
estimate of future cash flows from the debtor is affected.
(iii) Cash and cash equivalents
Cash and cash equivalents include cash in hand and deposits
repayable on demand or maturing within three months from the date
of acquisition.
(iv) Financial liabilities
Debt and trade payables are recognised initially at fair value
based on amounts exchanged, net of transaction costs, and
subsequently at amortised cost.
Interest expense on debt is accounted for using the effective
interest method and is recognised in finance costs.
(v) Trade payables
Trade payables are recognised initially at fair value and
subsequently measured at amortised cost using the effective
interest method.
(vi) Borrowings
Borrowings are initially recognised at fair value, net of
transaction costs incurred and carried subsequently at amortised
cost. Costs of borrowings, including commitment fees on undrawn
facilities, are recognised in the consolidated statement of
comprehensive income as incurred or, where appropriate, across the
term of the related borrowing.
(vii) Receivables from and payables to subsidiaries and the
Employee Benefit Trust
The Company has amounts receivable from and payable to
subsidiaries and the receivable from the Employee Benefit Trust
which are recognised at fair value. Amounts receivable from
subsidiaries and the Employee Benefit Trust are assessed annually
for recoverability under the requirements of IFRS 9.
(t) Key accounting assumptions, estimates and judgements
The preparation of financial information under IFRS requires the
use of certain key accounting assumptions and requires management
to exercise its judgement and to make estimates. The areas where
assumptions and estimates are significant to the consolidated
financial information are as follows:
Key sources of estimation uncertainty
(i) Carrying value of goodwill, other intangible assets and
Company investment estimate
In assessing whether goodwill, other intangible assets and the
Company's investment are impaired, the Group uses a discounted cash
flow model which includes forecast cash flows and estimates of
future growth. If the results of operations in future periods are
lower than included in the cash flow model, impairments may be
triggered. A sensitivity analysis has been performed on the
value-in-use calculations. Further details of the assumptions and
sensitivities in the discounted cash flow model are included in
notes 10 and 13.
(ii) Recoverability of trade receivables estimate
The allowance for expected lifetime credit losses for trade
receivables is calculated in line with IFRS 9. This is established
by considering on a discounted basis the cash shortfalls it would
incur in various default scenarios for prescribed future periods
and multiplying the shortfalls by the probability of each scenario
occurring. The historical loss rates are adjusted to reflect
current and forward-looking information on macroeconomic factors
affecting the ability of the customers to settle the receivables.
Further details about trade receivables are included in note 15 and
information about the credit risk and expected lifetime credit
losses are shown in note 26.
(iii) Share-based payments estimate
The fair value of the share-based compensation expense
recognised in the consolidated statement of comprehensive income
requires the use of estimates. Details regarding the determination
of fair value of these costs are set out in note 1(n)(ii).
(iv) Deferred tax judgement and estimate
The calculation of deferred tax assets and liabilities requires
judgement. Where the ultimate tax treatment is uncertain, the Group
recognises deferred tax assets and liabilities based on an estimate
of future taxable income and recoverability. Where a change in
circumstances occurs, or the final tax outcome is different from
the amounts that were initially recorded, such differences will
impact the income tax and deferred tax balances in the year in
which that change, or outcome, is known. The accounting policy
regarding deferred tax is set out above in note 1(h).
Critical accounting judgements
(v) Adjusting items judgement
The term 'adjusted' is not a defined term under IFRS. Judgement
is required to ensure that the classification and presentation of
certain items as adjusting, including exceptional items, is
appropriate and consistent with the Group's accounting policy.
Further details about the amounts classified as adjusting are
included in notes 1(b) and 4.
(vi) IFRS 16 reassessment of lease term judgement
Leases are required to be recognised at the present value of the
lease payments not yet paid for the duration of the lease term. The
lease term is defined by IFRS 16 as the non-cancellable period of
the lease, and any period covered by an option to extend or
terminate that the lessee is reasonably certain to exercise. The
assessment of the lease term requires judgement when considering
the option to extend or terminate in a contract.
During the year, the Group's property lease has been remeasured
upon reassessment of the lease term, where a judgement has been
taken that an option to extend will be exercised. The remeasurement
of the lease, and the corresponding adjustment to the ROU asset are
presented in notes 18 and 12 respectively.
2 Segmental reporting
The Group is organised around two reportable market-facing
segments: Xeim and The Lawyer. These two segments derive revenues
from a combination of premium content, marketing services, training
and advisory, events, marketing solutions and recruitment
advertising. Overhead costs are allocated to these segments on an
appropriate basis, depending on the nature of the costs, including
in proportion to revenues or headcount. Corporate income and costs
have been presented separately as 'Central'. The Group believes
this is the most appropriate presentation of segmental reporting
for the user to understand the core operations of the Group. There
is no inter-segmental revenue.
Segment assets consist primarily of property, plant and
equipment, intangible assets (including goodwill) and trade
receivables. Segment liabilities comprise trade payables, accruals
and deferred income.
Corporate assets and liabilities primarily comprise property,
plant and equipment, intangible assets, current and deferred tax
balances, cash and cash equivalents, borrowings and lease
liabilities.
Capital expenditure comprises additions to property, plant and
equipment and intangible assets.
Xeim The Lawyer Central Group
2021 Note GBP'000 GBP'000 GBP'000 GBP'000
----------------------------------------------------- ---- -------- ---------- -------- --------
Revenue 32,108 6,972 - 39,080
Adjusted operating profit / (loss) 1(b) 4,469 2,110 (3,347) 3,232
Amortisation of acquired intangibles 11 (1,091) - - (1,091)
Impairment of acquired intangibles 11 (25) - - (25)
Share-based payments 23 (113) (2) (380) (495)
Operating profit / (loss) 3,240 2,108 (3,727) 1,621
Finance income 1
Finance costs 6 (261)
----------------------------------------------------- ---- -------- ---------- -------- --------
Profit before tax 1,361
Taxation 7 56
----------------------------------------------------- ---- -------- ---------- -------- --------
Profit for the year 1,417
----------------------------------------------------- ---- -------- ---------- -------- --------
Segment assets 38,167 18,216 - 56,383
Corporate assets 12,491 12,491
----------------------------------------------------- ---- -------- ---------- -------- --------
Consolidated total assets 68,874
----------------------------------------------------- ---- -------- ---------- -------- --------
Segment liabilities (13,251) (2,795) - (16,046)
Corporate liabilities (5,720) (5,720)
----------------------------------------------------- ---- -------- ---------- -------- --------
Consolidated total liabilities (21,766)
----------------------------------------------------- ---- -------- ---------- -------- --------
Other items
Capital expenditure (tangible and intangible assets) 401 188 162 751
----------------------------------------------------- ---- -------- ---------- -------- --------
Discontinued
Xeim The Lawyer Central Continuing operations operations Group
2020 Note GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------------- -------- -------- ---------- -------- --------------------- -------------------- --------
Revenue 26,053 6,366 - 32,419 3,604 36,023
Other operating
income - - 2 2 - 2
--------------------- -------- -------- ---------- -------- --------------------- -------------------- --------
Adjusted operating
profit / (loss) 1(b) 1,923 1,408 (3,321) 10 41 51
Exceptional operating
costs 4 (283) (50) 95 (238) (911) (1,149)
Amortisation of
acquired intangibles 11 (1,464) - - (1,464) (485) (1,949)
Share-based payments 23 (304) (39) (198) (541) - (541)
Loss on disposal of
assets and
liabilities 11,12,18 - - (72) (72) (659) (731)
Impairment of
goodwill 10 - - - - (11,009) (11,009)
Operating (loss) /
profit (128) 1,319 (3,496) (2,305) (13,023) (15,328)
Finance income 6 1 7
Finance costs 6 (315) (24) (339)
--------------------- -------- -------- ---------- -------- --------------------- -------------------- --------
Loss before tax (2,614) (13,046) (15,660)
Taxation 7 895 337 1,232
--------------------- -------- -------- ---------- -------- --------------------- -------------------- --------
Loss for the year (1,719) (12,709) (14,428)
--------------------- -------- -------- ---------- -------- --------------------- -------------------- --------
Segment assets 40,618 17,734 - 58,352 - 58,352
Corporate assets 8,206 8,206 - 8,206
--------------------- -------- -------- ---------- -------- --------------------- -------------------- --------
Consolidated total
assets 66,558 - 66,558
--------------------- -------- -------- ---------- -------- --------------------- -------------------- --------
Segment liabilities (13,816) (3,103) - (16,919) (285) (17,204)
Corporate liabilities (2,184) (2,184) - (2,184)
--------------------- -------- -------- ---------- -------- --------------------- -------------------- --------
Consolidated total
liabilities (19,103) (285) (19,388)
--------------------- -------- -------- ---------- -------- --------------------- -------------------- --------
Other items
Capital expenditure (tangible
and intangible assets) 253 39 461 753 91 844
------------------------------- -------- ---------- -------- --------------------- -------------------- --------
Supplemental Information
Revenue by Geographical Location
The Group's revenues from continuing operations from external
customers by geographical location are detailed below:
Xeim The Lawyer Total Xeim The Lawyer Total
2021 2021 2021 2020 2020 2020
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
---------------------------------- -------- ---------- -------- -------- ---------- --------
United Kingdom 19,057 5,662 24,719 17,175 5,168 22,343
Europe (excluding United Kingdom) 4,567 675 5,242 2,503 636 3,139
North America 4,954 445 5,399 4,069 385 4,454
Rest of world 3,530 190 3,720 2,306 177 2,483
---------------------------------- -------- ---------- -------- -------- ---------- --------
32,108 6,972 39,080 26,053 6,366 32,419
---------------------------------- -------- ---------- -------- -------- ---------- --------
Substantially all of the Group's net assets are located in the
United Kingdom. The Directors therefore consider that the Group
currently operates in a single geographical segment, being the
United Kingdom. Refer to note 13 for the location of the Group's
subsidiaries.
Revenue by type
The Group's revenue from continuing operations by type is as
follows:
Xeim The Lawyer Total Xeim The Lawyer Total
2021 2021 2021 2020 2020 2020
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------ -------- ---------- -------- -------- ---------- --------
Premium Content 9,006 3,882 12,888 9,527 3,689 13,216
Marketing Services 3,301 - 3,301 2,889 - 2,889
Training and Advisory 12,542 18 12,560 8,497 36 8,533
Events 2,751 1,071 3,822 1,595 865 2,460
Marketing Solutions 4,145 840 4,985 3,291 915 4,206
Recruitment Advertising 363 1,161 1,524 254 861 1,115
32,108 6,972 39,080 26,053 6,366 32,419
------------------------ -------- ---------- -------- -------- ---------- --------
The accounting policies for each of these revenue streams is
disclosed in note 1(e), including the timing of revenue
recognition. There are some contracts for which revenue has not yet
been recognised and is being held in deferred income, see note 19.
This deferred income is all current and is expected to be
recognised as revenue in 2022.
3 Net operating expenses
Continuing operating profit / (loss) is stated after
charging:
Re-presented(2) Re-presented(2)
Adjusted Adjusting Statutory Adjusted Adjusting Statutory
Results(1) Items(1) Results Results(1) Items(1) Results
2021 2021 2021 2020 2020 2020
Note GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------------------- -------- ----------- --------- --------- ---------------- --------- ---------------
Employee benefits
expense 5 19,272 - 19,272 17,282 238 17,520
Government grants - - - (290) - (290)
--------------------------- -------- ----------- --------- --------- ---------------- --------- ---------------
Net employee benefits
expense 19,272 - 19,272 16,992 238 17,230
Depreciation of property,
plant and equipment 12 1,808 - 1,808 1,992 - 1,992
Loss on disposal of
assets and liabilities 11,12,18 - - - - 72 72
Amortisation of intangible
assets 11 1,335 1,091 2,426 1,816 1,464 3,280
Impairment of intangible
assets 11 55 25 80 - - -
Impairment of trade
receivables 26 (39) - (39) 255 - 255
Share-based payment
expense 23 - 495 495 - 541 541
IT expenditure 2,563 - 2,563 2,548 - 2,548
Marketing expenditure 1,399 - 1,399 719 - 719
Other staff related
costs 618 - 618 715 - 715
Other operating expenses 8,837 - 8,837 7,374 - 7,374
--------------------------- -------- ----------- --------- --------- ---------------- --------- ---------------
35,848 1,611 37,459 32,411 2,315 34,726
--------------------------- -------- ----------- --------- --------- ---------------- --------- ---------------
Cost of sales 15,082 - 15,082 12,604 - 12,604
Distribution costs 62 - 62 98 - 98
Administrative expenses 20,704 1,611 22,315 19,709 2,315 22,024
--------------------------- -------- ----------- --------- --------- ---------------- --------- ---------------
35,848 1,611 37,459 32,411 2,315 34,726
--------------------------- -------- ----------- --------- --------- ---------------- --------- ---------------
(1) Adjusted results exclude adjusting items, as detailed in
note 1(b)
(2) See note 1(a) for description of the prior year
re-presentation
Government grants
In prior year, the Group applied for government grants of
GBP835,000 for furloughed employees based at both the London and
Portsmouth offices. This was received in full during the prior
year. Government grants were deducted from the related employee
benefit expenses and presented within net operating expenses in the
consolidated statement of comprehensive income.
The government grants in continuing operations was GBP290,000
and in discontinued operations was GBP545,000.
No government grants were applied for in the current year.
Services provided by the Company's auditors
2021 2020
GBP'000 GBP'000
------------------------------------------------------------- -------- --------
Fees payable to the Company's auditor for the audit of the
Company and consolidated financial information 109 105
Fees payable to the Company's predecessor auditor for the
audit of the Company and consolidated financial information - 31
Total audit fees 109 136
------------------------------------------------------------- -------- --------
Audit related assurance services 10 50
Total non-audit fees 10 50
------------------------------------------------------------- -------- --------
Total fees 119 186
------------------------------------------------------------- -------- --------
4 Adjusting items
As discussed in note 1(b), certain items are presented as
adjusting. These are detailed below:
2021 2020
Note GBP'000 GBP'000
---------------------------------------------------------- -------- -------- --------
Continuing operations
Exceptional operating costs
Staff related restructuring costs (including external
employment advice costs) 5 - 238
Exceptional operating costs - 238
Amortisation of acquired intangible assets 11 1,091 1,464
Impairment of acquired intangible assets 11 25 -
Share-based payment expense 23 495 541
Loss on disposal of assets and liabilities 11,12,18 - 72
Adjusting items to profit / (loss) before tax 1,611 2,315
Tax relating to adjusting items 7 (195) (336)
---------------------------------------------------------- -------- -------- --------
Total adjusting items after tax for continuing operations 1,416 1,979
---------------------------------------------------------- -------- -------- --------
Discontinued operations
Exceptional costs 8,21 - 911
Impairment of goodwill 10 - 11,009
Amortisation of acquired intangible assets 11 - 485
Loss on disposal of assets and liabilities 11,12,18 - 659
Tax relating to adjusting items 7 - (243)
---------------------------------------------------------- -------- -------- --------
Total adjusting items after tax for discontinued
operations - 12,821
---------------------------------------------------------- -------- -------- --------
Total adjusting items after tax 1,416 14,800
---------------------------------------------------------- -------- -------- --------
Exceptional costs
Staff related restructuring costs (including external employment
advice costs)
In the prior year staff related restructuring costs of
GBP793,000 in discontinued operations related to restructuring of
the MarketMakers business and GBP238,000 in continuing operations
related to restructuring parts of the wider Centaur Group due to
the adverse impact of Covid. Refer to note 21 for further
details.
Other exceptional costs
In the prior year, GBP118,000 in discontinued operations related
to the exit of the Portsmouth lease upon cessation of MarketMakers'
telemarketing business.
Other adjusting items
Other adjusting items relate to the amortisation and impairment
of acquired intangible assets (see note 11) and share-based payment
costs (see note 23) as well as the items discussed below:
Goodwill impairment
An impairment of GBP11,009,000 against goodwill relating to the
MarketMakers business was recognised in the prior year. There were
no impairments recognised in the current year. See note 10 for
further details.
Loss on disposal of assets and liabilities
In the prior year the loss on disposal of assets and liabilities
in continuing operations of GBP72,000 consisted of a loss on
disposal of software assets of GBP60,000 (see note 11), a loss on
disposal of computer equipment of GBP53,000 (see note 12), a loss
on disposal of the MarketMakers ROU asset of GBP124,000 (see note
12) which represented the proportion of the asset attributable to
the continuing Really B2B business, offset by a GBP165,000 gain on
disposal of the corresponding lease liability (see note 18).
The loss on disposal of assets and liabilities in discontinued
operations of GBP659,000 consisted of the disposal of intangible
assets totalling a net book value of GBP830,000 (see note 11), with
proceeds on disposal of GBP150,000 creating a loss on disposal of
GBP680,000 (see note 11). Additionally, there was a loss on
disposal of computer equipment of GBP68,000, fixtures and fittings
of GBP65,000, and the MarketMakers ROU asset of GBP469,000 (see
note 12) which represented the proportion of the asset attributable
to the discontinued telemarketing business. This was offset by a
GBP623,000 gain on disposal of the corresponding lease liability
(see note 18).
In the current year, disposals of assets were at net book value,
resulting in no gain or loss on disposal.
5 Directors and employees
2020 2020 2020 2021 2020
2021 Continuing Discontinued Total Total Total
Group Group Group Group Company Company
Note GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------- ---- --------- ----------- -------------- --------- ----------- ---------
Wages and salaries 16,652 15,014 3,055 18,069 1,057 989
Social security costs 1,946 1,609 251 1,860 105 92
Other pension costs 674 659 57 716 42 34
------------------------------------- ---- --------- ----------- -------------- --------- ----------- ---------
Adjusted staff costs 19,272 17,282 3,363 20,645 1,204 1,115
Government grants 3 - (290) (545) (835) - -
Exceptional staff related
restructuring costs 4 - 238 793 1,031 - -
Equity-settled share-based payments 23 495 541 - 541 325 (15)
------------------------------------- ---- --------- ----------- -------------- --------- ----------- ---------
19,767 17,771 3,611 21,382 1,529 1,100
------------------------------------- ---- --------- ----------- -------------- --------- ----------- ---------
The average monthly number of employees employed during the
year, including Executive Directors, was:
2021 2020 2021 2020
Group Group Company Company
Number Number Number Number
------------- ------- ------- -------- --------
Xeim 202 216 - -
The Lawyer 52 56 - -
Central 10 10 4 4
Discontinued - 134 - -
264 416 4 4
------------- ------- ------- -------- --------
The Group's employees are employed and paid by Centaur
Communications Limited, a Group company, with the exception of the
Company's directors who are employed by the Company. As the
employees provide services to other Group companies, their costs
are recharged, and the relevant disclosures are made in the
financial information. The employees relating to discontinued
operations were employed and paid by Market Makers Incorporated
Limited.
Key management compensation
2021 2020
GBP'000 GBP'000
-------------------------------------------- -------- --------
Salaries and short-term employment benefits 1,736 1,216
Post-employment benefits 74 57
Share-based payments 64 40
1,874 1,313
-------------------------------------------- -------- --------
Key management is defined as the Executive Directors and
Executive Committee members.
Aggregate Directors' remuneration
2021 2020
GBP'000 GBP'000
--------------------------------------------- -------- --------
Salaries, fees, bonuses and benefits in kind 1,150 753
Post-employment benefits 46 29
---------------------------------------------- -------- --------
1,196 782
--------------------------------------------- -------- --------
Highest paid Director's remuneration
2021 2020
GBP'000 GBP'000
--------------------------------------------- -------- --------
Salaries, fees, bonuses and benefits in kind 592 386
Post-employment benefits 37 20
629 406
--------------------------------------------- -------- --------
No directors exercised share options during the year (2020: one
director and one former director exercised share options). Further
details of Directors' remuneration are included in the Remuneration
Committee Report.
6 Finance costs
2021 2020 2020 2020
Group Continuing Discontinued Total
Note GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------------------ ------ -------- ----------- ------------- --------
Commitment fees and amortisation of arrangement
fee in respect of revolving credit facility 194 215 - 215
Lease interest 18 67 100 24 124
261 315 24 339
------------------------------------------------ ------ -------- ----------- ------------- --------
Interest and fees on revolving credit facility
These finance costs are in relation to the GBP25m revolving
credit facility, none of which was drawn down at 31 December 2021
(2020: GBPnil). As indicated by the consolidated cash flow
statement, there were no drawdowns from this facility during the
current and prior year. Finance costs in relation to this facility
resulted in cash outflows by the Company and Group of GBP194,000
during the year (2020: GBP155,000).
Lease interest
Lease liabilities are recognised for the Group's property lease
arrangements. GBP67,000 of interest on these leases was incurred
during the year (2020: GBP124,000). Please refer to notes 1(i) and
18 for further details.
7 Taxation
2021 2020 2020 2020
Group Continuing Discontinued Total
Note GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------------- ---- -------- ----------- ------------- --------
Analysis of (credit) / charge for the year
Current tax 20
UK Corporation Tax - 105 (105) -
Overseas tax 14 24 - 24
Adjustments in respect of prior years (38) (20) - (20)
(24) 109 (105) 4
------------------------------------------- ---- -------- ----------- ------------- --------
Deferred tax 14
Current period (175) (731) (232) (963)
Adjustments in respect of prior years 143 (273) - (273)
------------------------------------------- -------------- ----------- ------------- --------
(32) (1,004) (232) (1,236)
------------------------------------------- -------------- ----------- ------------- --------
Taxation credit (56) (895) (337) (1,232)
------------------------------------------- -------------- ----------- ------------- --------
The tax credit for the year can be reconciled to the profit /
(loss) in the consolidated statement of comprehensive income as
follows:
'000 '000 '000 '000
2021 2020 2020 2020
Group Continuing Discontinued Total
GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------------------------------- -------- ----------- ------------- --------
Profit / (loss) before tax 1,361 (2,614) (13,046) (15,660)
Tax at the UK rate of corporation tax of 19.0% (2020: 19.0%) 259 (497) (2,479) (2,976)
Effects of:
Expenses not deductible for tax purposes 69 62 2,119 2,181
Share-based payments 47 - - -
Effects of changes in tax rate on deferred tax balances (538) (170) 23 (147)
Different tax rates of subsidiaries in other jurisdictions 2 3 - 3
Adjustments in respect of prior years 105 (293) - (293)
Taxation credit (56) (895) (337) (1,232)
------------------------------------------------------------- -------- ----------- ------------- --------
The Finance Act 2021 included provisions to increase the main
rate of corporation tax to 25% from 1 April 2023. This change had
been substantively enacted at the reporting date.
A reconciliation between the reported tax expense and the
adjusted tax expense taking account of adjusting items as discussed
in note 1(b) and 4 is shown below:
2021 2020 2020 2020
Group Continuing Discontinued Total
GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------ -------- ----------- ------------- --------
Reported tax credit (56) (895) (337) (1,232)
Effects of:
Amortisation of acquired intangible
assets 112 233 92 325
Exceptional costs - - 151 151
Share-based payments 83 103 - 103
------------------------------------ -------- ----------- ------------- --------
Adjusted tax charge / (credit) 139 (559) (94) (653)
------------------------------------ -------- ----------- ------------- --------
8 Discontinued operations
A significant restructuring of the MarketMakers' business was
executed during the prior year following an adverse impact on the
performance of the telemarketing business following the onset of
Covid. This led to the closure of the MarketMakers' telemarketing
business in August 2020. MarketMakers' Really B2B brand continues
to operate and its performance is reported as part of continuing
operations.
A loss on disposal of GBP659,000 arose on the disposal of assets
relating to the MarketMakers' telemarketing business being the
difference between the proceeds of disposal and the carrying amount
of the net assets. Details of the disposal can be found in note
4.
The results of the discontinued operations, which were included
in the consolidated statement of comprehensive income and
consolidated cash flow statement, were as follows:
2020
Statement of comprehensive income GBP'000
--------------------------------------------------------------------- --------
Revenue 3,604
Expenses (15,991)
Loss on disposal (659)
--------------------------------------------------------------------- --------
Loss before tax (13,046)
Attributable tax credit 337
--------------------------------------------------------------------- --------
Statutory loss after tax (12,709)
Add back adjusting items (1) :
Exceptional costs 911
Impairment of goodwill 11,009
Amortisation of acquired intangible assets 485
Loss on disposal 659
Tax relating to adjusting items(1) (243)
--------------------------------------------------------------------- --------
Total adjusting items(1) 12,821
--------------------------------------------------------------------- --------
Adjusted profit(1) attributable to discontinued operations after tax 112
--------------------------------------------------------------------- --------
(1) Adjusted results exclude adjusting items, as detailed in
note 1(b)
The attributable tax credit stated in the table above is derived
from the loss from discontinued operations. No income tax credit
arose on the loss on disposal.
2020
Cash flows GBP'000
--------------------- ---------
Operating cash flows 280
Investing cash flows 102
Financing cash flows (382)
--------------------- ---------
Total cash flows -
--------------------- ---------
There were no discontinued operations for the year ended 31
December 2021.
9 Earnings / (loss) per share
Basic earnings per share ('EPS') is calculated by dividing the
earnings attributable to ordinary shareholders by the weighted
average number of shares in issue during the year. 2,064,185 (2020:
1,948,492) shares held in the Employee Benefit Trust and 4,550,179
(2020: 4,550,179) shares held in treasury (see note 22) have been
excluded in arriving at the weighted average number of shares.
For diluted earnings per share the weighted average number of
ordinary shares in issue is adjusted to assume conversion of all
potentially dilutive ordinary shares. This comprises share options
and awards granted to Directors and employees under the Group's
share-based payment plans where the exercise price is less than the
average market price of the Company's ordinary shares during the
year.
Basic and diluted earnings per share have also been presented on
an adjusted continuing and discontinued basis, as the Directors
believe that these measures are more reflective of the underlying
performance of the Group. These have been calculated as
follows:
2021 Earnings 2020 Earnings
/ (loss) 2021 2021 / (loss) 2020 2020
attributable Weighted Earnings / attributable Weighted Earnings /
to owners of average number (loss) per to owners of average number (loss) per
the parent of shares share the parent of shares share
Note GBP'000 thousands pence GBP'000 thousands pence
-------------- -------- ------------- -------------- -------------- ------------- -------------- --------------
Basic
Continuing
operations 1,417 144,927 1.0 (1,719) 144,267 (1.2)
Continuing and
discontinued
operations 1,417 144,927 1.0 (14,428) 144,267 (10.0)
Effect of
dilutive
securities
Options:
Continuing
operations - 7,947 (0.1) - - -
Options:
Continuing
and
discontinued
operations - 7,947 (0.1) - - -
Diluted
Continuing
operations 1,417 152,874 0.9 (1,719) 144,267 (1.2)
Continuing and
discontinued
operations 1,417 152,874 0.9 (14,428) 144,267 (10.0)
-------------- -------- ------------- -------------- -------------- ------------- -------------- --------------
Adjusted(1)
Continuing
operations
Basic 1,417 144,927 1.0 (1,719) 144,267 (1.2)
Other
exceptional
costs 4 - - - 238 - 0.2
Amortisation
of acquired
intangibles 11 1,091 - 0.8 1,464 - 1.0
Impairment of
acquired
intangibles 11 25 - - - - -
Share-based
payments 23 495 - 0.3 541 - 0.4
Loss on
disposal of
assets and
liabilities 11,12,18 - - - 72 - -
Tax effect of
above
adjustments 7 (195) - (0.1) (336) - (0.2)
Discontinued
operations
Basic - 144,927 - (12,709) 144,267 (8.8)
Other
exceptional
costs 4 - - - 911 - 0.6
Impairment of
goodwill 10 - - - 11,009 - 7.6
Amortisation
of acquired
intangibles 11 - - - 485 - 0.3
Loss on
disposal of
assets and
liabilities 11,12,18 - - - 659 - 0.5
Tax effect of
above
adjustment 7 - - - (243) - (0.1)
-------------- -------- ------------- -------------- -------------- ------------- -------------- --------------
Adjusted(1)
basic
Continuing
operations 2,833 144,927 2.0 260 144,267 0.2
Continuing and
discontinued
operations 2,833 144,927 2.0 372 144,267 0.3
Effect of
dilutive
securities
Options:
Continuing
operations - 7,947 (0.1) - 7,319 -
Options:
Continuing
and
discontinued
operations - 7,947 (0.1) - 7,319 -
Adjusted(1)
diluted
Continuing
operations 2,833 152,874 1.9 260 151,586 0.2
Continuing and
discontinued
operations 2,833 152,874 1.9 372 151,586 0.3
-------------- -------- ------------- -------------- -------------- ------------- -------------- --------------
(1) Adjusted results exclude adjusting items, as detailed in
note 1(b)
Adjusted Adjusted Statutory Adjusted Adjusted Statutory
Results(1) Items(1) Results Results(1) Items(1) Results
2021 2021 2021 2020 2020 2020
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------------------------- ----------- --------- --------- ----------- --------- ---------
Earnings / (loss) per share
attributable to owners
of the parent
Fully diluted from continuing
operations 1.9p (1.0p) 0.9p 0.2p (1.4p) (1.2p)
Fully diluted from discontinued
operations - - - 0.1p (8.9p) (8.8p)
-------------------------------- ----------- --------- --------- ----------- --------- ---------
Fully diluted from continuing
and discontinued 1.9p (1.0p) 0.9p 0.3p (10.3p) (10.0p)
-------------------------------- ----------- --------- --------- ----------- --------- ---------
(1) Adjusted results exclude adjusting items, as detailed in
note 1(b)
10 Goodwill
Group
Note GBP'000
----------------------------------------- ---- --------
Cost
At 1 January 2020 111,113
Closure of business 8 (11,009)
Elimination of goodwill (18,995)
At 31 December 2020 and 31 December 2021 81,109
Accumulated impairment
At 1 January 2020 58,942
Impairment 8 11,009
Elimination of goodwill (30,004)
----------------------------------------- ---- --------
At 31 December 2020 and 31 December 2021 39,947
Net book value
----------------------------------------- --------------
At 31 December 2020 and 31 December 2021 41,162
----------------------------------------- --------------
In the prior year, an impairment of GBP11,009,000 was recognised
in the Xeim CGU, entirely related to the MarketMakers ('MM')
business within that CGU. The MM telemarketing business ceased
operations, and the goodwill cost and accumulated impairment was
eliminated as at 31 December 2020. The impairment was included
within discontinued operations as disclosed in note 8.
In addition to the impairment and subsequent elimination of
goodwill relating to MM, the Group also eliminated GBP18,995,000 of
goodwill in prior year that had been fully impaired in previous
financial years relating to legacy brands and businesses that the
Group no longer operated.
At 31 December 2021 a full impairment assessment has been
carried out. No impairment is required for the carrying value of
goodwill.
Goodwill by segment
Each brand is deemed to be a cash generating unit ('CGU'), being
the lowest level at which cash flows are separately identifiable.
Goodwill is attributed to individual CGUs and has historically been
reviewed at the operating segment level for the purposes of the
annual impairment review as this is the level at which management
monitors goodwill.
Xeim The Lawyer Total
Note GBP'000 GBP'000 GBP'000
----------------------------------------- ------ -------- ---------- --------
At 1 January 2020 36,197 15,974 52,171
Impairment charge 8 (11,009) - (11,009)
At 31 December 2020 and 31 December 2021 25,188 15,974 41,162
----------------------------------------- ------ -------- ---------- --------
Impairment testing of goodwill and acquired intangible
assets
At 31 December 2021, goodwill and acquired intangible assets
(see note 11) were tested for impairment in accordance with IAS 36.
In assessing whether an impairment of goodwill and acquired
intangible assets is required, the carrying value of the segment is
compared with its recoverable amount. Recoverable amounts are
measured based on value-in-use ('VIU').
The Group estimates the VIU of its CGUs using a discounted cash
flow model, which adjusts the cash flows for risks associated with
the assets and discounts these using a pre-tax rate of 10.3% (2020:
12.8%). The discount rate used is consistent with the Group's
weighted average cost of capital and is used across all segments,
which are all based predominantly in the UK and considered to have
similar risks and rewards.
The key assumptions used in calculating VIU are revenue growth,
margin, Adjusted EBITDA growth, discount rate and the terminal
growth rate. The Group has used the three-year plan forecast to
2024 for the first three years of the calculation and applied a
terminal growth rate of 2.5% (2020: 2.5%). This timescale and the
terminal growth rate are both considered appropriate given the
nature of the Group's revenues. The Group's current year results
have performed in line with the MAP23 strategy and hence this
strategy has not been revised from the prior year. The three-year
forecast to 2024 assumes achievement of MAP23 targets, with the
forecast for 2024 continuing that strategy. The MAP23 targets were
built, bottom-up during 2020 once the impact of Covid had become
clear. The strategy focuses on investment and resource allocation
on the Flagship 4, the four brands we consider our key drivers for
organic revenue growth. Further details of the MAP23 plan can be
found in the Strategy section of the 2020 Annual Report.
The key assumptions used in the calculations of VIU for each
segment have been derived from a combination of experience and
management's expectations of future growth rates in the business.
The forecasts have been prepared following a review of the business
where management has identified the key growth and focus areas
which will deliver the targets, and conversely which areas of the
business will be de-prioritised over that period. The forecasts
reflect the transformed Group which is more focused and streamlined
in order to deliver higher margins and profits.
The key assumptions and variables in this plan are sensitised in
isolation and in combination. The main sensitivities applied to the
key drivers are outlined below. As required by IAS 36, these
sensitivities are applied in order to assess the effect of
reasonably possible changes in the assumptions.
Sensitivity analysis has been performed on the VIU calculations,
holding all other variables constant, to:
I. apply a 10% reduction to forecast Adjusted EBITDA in each year of the
modelled cash flows. No impairment would occur in either of the segments.
II. apply a 4 percentage point increase in discount rate from 10.3% to
14.3%. No impairment would occur in either of the segments.
III. reduce the terminal value growth rate from 2.5% to 1.5%. No impairment
would occur in either of the segments.
The results of the impairment assessment and sensitivities
applied indicate that no impairment to the goodwill of either CGU
is required for the year ended 31 December 2021.
11 Other intangible assets
Separately
Brands and Customer acquired websites
Computer software publishing rights relationships and content Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------------- ------------------ -------------------- -------------------- ------------------- --------
Cost
At 1 January 2020 19,248 2,072 13,030 3,216 37,566
Additions -
separately acquired 292 - - - 292
Additions -
internally generated 318 - - - 318
Disposals (870) (514) (1,709) - (3,093)
Exchange differences (5) - - - (5)
--------------------- ------------------ -------------------- -------------------- ------------------- --------
At 31 December 2020 18,983 1,558 11,321 3,216 35,078
Additions -
separately acquired 396 - - - 396
Additions -
internally generated 298 - - - 298
Disposals (48) (178) - - (226)
Exchange differences 2 - - - 2
At 31 December 2021 19,631 1,380 11,321 3,216 35,548
--------------------- ------------------ -------------------- -------------------- ------------------- --------
Accumulated
amortisation
At 1 January 2020 14,817 846 9,716 3,216 28,595
Amortisation charge
for the year 1,944 165 1,671 - 3,780
Disposals (535) (203) (1,465) - (2,203)
Exchange differences (5) - - - (5)
--------------------- ------------------ -------------------- -------------------- ------------------- --------
At 31 December 2020 16,221 808 9,922 3,216 30,167
Amortisation charge
for the year 1,335 114 977 - 2,426
Impairment charge for
the year 55 25 - - 80
Disposals (48) (178) - - (226)
Exchange differences (1) - - - (1)
At 31 December 2021 17,562 769 10,899 3,216 32,446
--------------------- ------------------ -------------------- -------------------- ------------------- --------
Net book value at 31
December 2021 2,069 611 422 - 3,102
--------------------- ------------------ -------------------- -------------------- ------------------- --------
Net book value at 31
December 2020 2,762 750 1,399 - 4,911
--------------------- ------------------ -------------------- -------------------- ------------------- --------
Net book value at 1
January 2020 4,431 1,226 3,314 - 8,971
--------------------- ------------------ -------------------- -------------------- ------------------- --------
In the current year, the Group disposed of intangible assets
totalling a net book value of GBPnil.
During the prior year, the Group disposed of intangible assets
totalling a net book value of GBP890,000. GBP60,000 of this was
recognised in the consolidated statement of comprehensive income in
continuing operations. The GBP60,000 loss on disposal of intangible
assets in continuing operations related to software assets that
were no longer in use by the business.
The remaining GBP830,000 of assets disposed were recognised in
discontinued operations, along with proceeds of disposal of
GBP150,000, resulting in a loss on disposal of GBP680,000 in
discontinued operations. The GBP680,000 loss on disposal of
intangible assets in discontinued operations resulted from the
disposal relating to the MarketMakers ('MM') business. On 24 August
2020, the Group disposed of the MM branding and website with a net
book value of GBP311,000 for proceeds of GBP150,000, resulting in a
loss of GBP161,000. Customer relationships recognised on the
acquisition of the MM business in 2017 with a net book value of
GBP244,000 were disposed resulting in a loss of GBP244,000. MM
software assets were disposed at a net book value of GBP275,000
resulting in a loss of GBP275,000. These disposals were effected in
line with the closure of the MM telemarketing business following an
adverse impact on trading performance caused by Covid.
Amortisation and impairment of intangible assets is included in
net operating expenses in the consolidated statement of
comprehensive income. The amortisation charge in continuing
operations is GBP2,426,000 (2020: GBP3,280,000) and in discontinued
operations is GBPnil (2020: GBP500,000). Amortisation on acquired
intangible assets from business combinations is presented as an
adjusting item in note 4 (see note 1(b) for further information).
Total amortisation of GBP1,091,000 (2020: GBP1,949,000) on such
assets is all amortisation on assets in the asset groups 'Brands
and publishing rights', 'Customer relationships' and 'Separately
acquired websites and content' of GBP1,091,000 (2020: GBP1,836,000)
in addition to GBPnil (2020: GBP113,000) of amortisation on
acquired intangible assets in the asset group 'Computer software'.
These total amounts relate to continuing operations GBP1,091,000
(2020: GBP1,464,000) and discontinued operations GBPnil (2020:
GBP485,000) as shown in note 4.
Other intangible assets are tested annually for impairment in
accordance with IAS 36 at a segment level by comparing the carrying
value with its recoverable amount. Please see note 10 for further
details. During the current year, the Group impaired intangible
assets totalling a net book value of GBP80,000. The GBP80,000
impairment charge relates to computer software and brand and
publishing rights no longer in use by the business.
The Company has no intangible assets (2020: GBPnil).
12 Property, plant and equipment
Leasehold Fixtures Computer ROU assets - property
improvements and fittings equipment GBP'000 Total
GBP'000 GBP'000 GBP'000 GBP'000
----------------------------------- ------------- ------------- ---------- --------------------- ---------
Cost
At 1 January 2020 2,112 618 1,902 5,501 10,133
Additions - separately acquired - 14 209 1,704 1,927
Disposals (2,112) (564) (1,061) (2,122) (5,859)
Exchange differences - - (1) (6) (7)
------------------------------------ ------------- ------------- ---------- --------------------- ---------
At 31 December 2020 - 68 1,049 5,077 6,194
Additions - separately acquired - 5 51 978 1,034
Disposals - - (2) - (2)
Exchange differences - - - 2 2
------------------------------------ ------------- ------------- ---------- --------------------- ---------
At 31 December 2021 - 73 1,098 6,057 7,228
------------------------------------ ------------- ------------- ---------- --------------------- ---------
Accumulated depreciation
At 1 January 2020 2,112 484 1,405 1,817 5,818
Depreciation charge for the year - 55 240 1,912 2,207
Disposals (2,112) (499) (940) (1,529) (5,080)
Exchange differences - - (1) (8) (9)
------------------------------------ ------------- ------------- ---------- --------------------- ---------
At 31 December 2020 - 40 704 2,192 2,936
Depreciation charge for the year - 21 138 1,649 1,808
Disposals - - (2) - (2)
Exchange differences - - - 2 2
------------------------------------ ------------- ------------- ---------- --------------------- ---------
At 31 December 2021 - 61 840 3,843 4,744
------------------------------------ ------------- ------------- ---------- --------------------- ---------
Net book value at 31 December 2021 - 12 258 2,214 2,484
------------------------------------ ------------- ------------- ---------- --------------------- ---------
Net book value at 31 December 2020 - 28 345 2,885 3,258
------------------------------------ ------------- ------------- ---------- --------------------- ---------
Net book value at 1 January 2020 - 134 497 3,684 4,315
------------------------------------ ------------- ------------- ---------- --------------------- ---------
In the current year, the Group disposed of tangible assets
totalling a net book value of GBPnil.
During the prior year the Group disposed of tangible assets
totalling a net book value of GBP779,000, which resulted in a loss
on disposal of tangible assets of GBP779,000 (GBP177,000 in
continuing operations and GBP602,000 in discontinued operations,
see note 4).
In prior year, the GBP177,000 loss on disposal of tangible
assets in continuing operations related to computer equipment
assets that were no longer in use by the business (GBP53,000), and
a proportion of the disposal of the MarketMakers' ROU asset that
related to the continuing Really B2B business (GBP124,000).
In prior year, the GBP602,000 loss on disposal of tangible
assets in discontinued operations related to disposal of computer
equipment (GBP68,000), fixtures and fittings (GBP65,000) and a
proportion of the disposal of the MarketMakers' ROU asset that
related to the discontinued telemarketing business (GBP469,000).
These disposals were effected in line with the closure of the MM
telemarketing business following an adverse impact on trading
performance caused by Covid.
Depreciation and impairment of property, plant and equipment is
included in net operating expenses in the consolidated statement of
comprehensive income.
The depreciation charge in continuing operations is GBP1,808,000
(2020: GBP1,992,000) and in discontinued operations is GBPnil
(2020: GBP215,000).
The Company has no property, plant and equipment at 31 December
2021 (2020: GBPnil).
13 Investments
Investments
in subsidiary
undertakings
Company GBP'000
----------------------------------- --------------
Cost
At 1 January 2020 151,134
Additions 251
----------------------------------- --------------
At 31 December 2020 151,385
Additions 163
----------------------------------- --------------
At 31 December 2021 151,548
----------------------------------- --------------
Accumulated impairment
At 1 January 2020 61,000
Impairment charge for the year 25,393
----------------------------------- --------------
At 31 December 2020 86,393
Impairment charge for the year -
----------------------------------- --------------
At 31 December 2021 86,393
----------------------------------- --------------
Net book value at 31 December 2021 65,155
----------------------------------- --------------
Net book value at 31 December 2020 64,992
----------------------------------- --------------
Net book value at 1 January 2020 90,134
----------------------------------- --------------
Impairment testing of the investment
As outlined in the tables below, the carrying value of the
investment represents the Company's direct ownership of Centaur
Communications Limited ('CCL'). At 31 December 2021, the investment
was tested for impairment in accordance with IAS 36. In assessing
whether an impairment of the investment is required, the carrying
value of the investment is compared with its recoverable amount.
The recoverable amount is measured based on value-in-use ('VIU').
Although the Company only has direct ownership of CCL, CCL in turn
directly or indirectly controls the rest of the Group's
subsidiaries. Therefore, the VIU of the Company's investment in CCL
is supported by the operations of the entire Group.
In the prior year, the ongoing global pandemic and its impact on
the economy and directly on the Group was identified as an
indication of impairment of the Company's investment carrying
value, particularly following the closure of the MarketMakers
('MM') telemarketing business. Therefore, a full impairment
assessment was performed. An impairment of GBP25,393,000 was
identified and recognised in the Company's statement of
comprehensive income. After this impairment at 31 December 2020,
the carrying value of the investment was supported by the
underlying trade of the continuing Group.
In the current year, the ongoing global pandemic and its impact
on the economy and directly on the Group was identified as an
indication of impairment of the Company's investment carrying
value. Therefore, a full impairment assessment has been
performed.
The Group estimates the VIU using a discounted cash flow model,
which adjusts the cash flows for risks associated with the assets
and discounts these using a pre-tax rate of 10.3% (2020: 12.8%).
The discount rate used is consistent with the Group's weighted
average cost of capital.
The key assumptions used in calculating VIU are revenue growth,
margin, Adjusted EBITDA growth, discount rate and the terminal
growth rate. The Group has used its three-year plan forecast to
2024 for the first three years of the calculation and applied a
terminal growth rate of 2.5% (2020: 2.5%). This timescale and the
terminal growth rate are both considered appropriate given the
nature of the Group's revenues. The Group's current year results
have performed in line with the MAP23 strategy and hence this
strategy has not been revised from the prior year. The three-year
forecast to 2024 assumes achievement of MAP23 targets, with the
forecast for 2024 continuing that strategy. The MAP23 targets were
built, bottom-up during 2020 once the impact of Covid had become
clear. The strategy focuses on investment and resource allocation
on the Flagship 4, the four brands we consider our key drivers for
organic revenue growth. Further details of the MAP23 plan can be
found in the Strategy section of the 2020 Annual Report.
The assumptions used in the calculations of VIU have been
derived based on a combination of experience and management's
expectations of future growth rates in the business. The forecasts
have been prepared following a review of the business where
management has identified the key growth and focus areas which will
deliver the targets, and conversely which areas of the business
will be de-prioritised over that period. The forecasts reflect the
transformed Group which is more focused and streamlined in order to
deliver higher margins and profits.
Sensitivities are applied to each of the key assumptions and
variables in isolation and in combination, in line with those
sensitivities applied for goodwill impairment testing as outlined
in note 10. As required by IAS 36, these sensitivities are applied
in order to assess the effect of reasonably possible changes in the
assumptions.
The results of the impairment assessment and sensitivities
applied indicate that no impairment to the Company's investment in
CCL is required for the year ended 31 December 2021.
Additions of GBP163,000 (2020: GBP251,000) related to capital
contributions for share-based payments recharged to the Company's
subsidiaries.
In order to simplify the Group structure, the process to close
dormant companies commenced during the year.
The Group closed the following subsidiaries during the year:
Proportion of ordinary
shares and voting rights
Name held (%) Principal activities Country of incorporation Date of closure
------------------------- ------------------------- -------------------- ------------------------ ----------------
E-consultancy Asia 100 Dormant Singapore 6 June 2021
Pacific Pte Limited
E-consultancy Australia 100 Dormant Australia 5 April 2021
Pty Limited
Mayfield Publishing 100 Dormant United Kingdom 21 December 2021
Limited
Your Business Magazine 100 Dormant United Kingdom 20 April 2021
Limited
------------------------- ------------------------- -------------------- ------------------------ ----------------
Centaur Newco 2018 Limited was dissolved during the prior year.
The company did not trade since incorporation.
At 31 December 2021, the Group has control over the following
subsidiaries:
Proportion
of ordinary
shares and
voting rights
Name held (%) Principal activities Country of incorporation
-------------------------- -------------- ----------------------------- ------------------------
Centaur Communications 100 Holding company and agency United Kingdom
Limited (1) services
Centaur Media USA Inc.(2) 100 Digital information, training United States
and events
Chiron Communications 100 In liquidation United Kingdom
Limited
E-consultancy LLC (2) 100 Digital information, training United States
and events
E-consultancy.com Limited 100 Digital information, training United Kingdom
and events
Market Makers Incorporated 100 In liquidation United Kingdom
Limited
Pro-Talk Ltd 100 In liquidation United Kingdom
Taxbriefs Holdings Limited 100 Holding company United Kingdom
Taxbriefs Limited 100 In liquidation United Kingdom
TheLawyer.com Limited 100 Digital information services United Kingdom
Xeim Limited 100 Digital information services United Kingdom
-------------------------- -------------- ----------------------------- ------------------------
(1) Directly owned by Centaur Media Plc
(2) Registered address is 251 Little Falls Drive, Wilmington,
DE19808, USA. Functional currency is USD
The registered address of all subsidiary companies, except for
those identified above, is Floor M, 10 York Road, London, SE1 7ND,
United Kingdom. The functional currency of all subsidiaries is GBP
except for those identified above. The consolidated financial
information incorporates the financial information of all entities
controlled by the Company at 31 December 2021.
14 Deferred tax
The movement on the deferred tax account for the Group is shown
below:
Accelerated Other
capital temporary Tax
allowances differences losses Total
GBP'000 GBP'000 GBP'000 GBP'000
--------------------------------------------- ----------- ------------ -------- --------
Net asset / (liability) at 1 January 2020 626 (368) 716 974
Adjustments in respect of prior periods 66 174 33 273
Recognised in the statement of comprehensive
income (9) 180 792 963
--------------------------------------------- ----------- ------------ -------- --------
Net asset / (liability) at 31 December 2020 683 (14) 1,541 2,210
Adjustments in respect of prior periods (42) (55) (46) (143)
Recognised in the statement of comprehensive
income 69 110 (4) 175
Recognised in the statement of changes in
equity - 118 - 118
Net asset at 31 December 2021 710 159 1,491 2,360
--------------------------------------------- ----------- ------------ -------- --------
Deferred tax assets and liabilities are only offset where there
is a legally enforceable right of offset and there is an intention
to settle the balances net.
2021 2020
Group Group
GBP'000 GBP'000
------------------------- -------- --------
Deferred tax assets 2,488 2,449
Deferred tax liabilities (128) (239)
------------------------- -------- --------
2,360 2,210
------------------------- -------- --------
At the year end, the Group has unused tax losses of GBP5,961,000
(2020: GBP8,104,000) available for offset against future profits. A
deferred tax asset of GBP1,491,000 (2020: GBP1,541,000) has been
recognised in respect of GBP5,961,000 (2020: GBP8,104,000) of such
tax losses. The Group has concluded that the deferred tax asset
will be recoverable using the estimated future taxable profit based
on the FY22-24 3YP forecast. The Group is expected to generate
taxable profits from 2022 onwards. The losses can be carried
forward indefinitely and have no expiry date as long as the
companies that have the losses continue to trade.
The Company had deferred tax assets on share options under
long-term incentive plans of GBP190,000 at 31 December 2021 (2020:
GBP68,000).
Deferred tax assets and liabilities are expected to be
materially utilised after 12 months.
15 Trade and other receivables
2021 2020 2021 2020
Group Group Company Company
Note GBP'000 GBP'000 GBP'000 GBP'000
--------------------------------------- ------------------- -------- -------- -------- --------
Amounts falling due within one year
Trade receivables 5,475 5,211 - -
Less: expected credit loss 26 (564) (993) - -
--------------------------------------- ------------------- -------- -------- -------- --------
Trade receivables - net 4,911 4,218 - -
Receivables from subsidiaries - - - 34,973
Receivable from Employee Benefit Trust - - - 560
Other receivables 92 162 34 77
Prepayments 981 1,240 127 107
Accrued income 75 161 - -
6,059 5,781 161 35,717
--------------------------------------- ------------------- -------- -------- -------- --------
2021 2020 2021 2020
Group Group Company Company
GBP'000 GBP'000 GBP'000 GBP'000
--------------------------------------- -------- -------- --------- --------
Amounts falling due after one year
Other receivables 319 515 41 237
Receivable from Employee Benefit Trust - - 1,156 -
319 515 1,197 237
--------------------------------------- -------- -------- --------- --------
Trade receivables included GBP114,000 and the expected credit
loss included GBP114,000 in relation to discontinued operations as
at 31 December 2020. No amounts relate to discontinued operations
as at 31 December 2021.
Receivables from subsidiaries are unsecured, have no fixed due
date and bear interest at an annual rate of 3.45% (2020: 2.49%). In
preparation for liquidation of certain Group subsidiaries (see note
13) the Company settled receivables and payables with these
subsidiaries during the year.
The receivable from Employee Benefit Trust is unsecured, has no
fixed due date and does not bear interest.
Other receivables due after one year include GBP278,000 (2020:
GBP278,000) in relation to a deposit on the London property lease
which is fully refundable at the end of the lease term.
16 Cash and cash equivalents
2021 2020
Group Group
GBP'000 GBP'000
------------------------- -------- --------
Cash at bank and in hand 13,065 8,300
------------------------- -------- --------
The Company had no cash and cash equivalents at 31 December 2021
(2020: GBPnil).
17 Trade and other payables
2021 2020 2021 2020
Group Group Company Company
GBP'000 GBP'000 GBP'000 GBP'000
-------------------------------- -------- -------- -------- --------
Trade payables 1,070 219 - -
Payables to subsidiaries - - 29,397 60,044
Accruals 8,112 5,652 496 406
Social security and other taxes 886 1,274 - -
Other payables 1,337 1,574 - 7
11,405 8,719 29,893 60,457
-------------------------------- -------- -------- -------- --------
Payables to subsidiaries are unsecured, have no fixed date of
repayment and bear interest at an annual rate of 3.45% (2020:
2.49%). In preparation for liquidation of certain Group
subsidiaries (see note 13) the Company settled receivables and
payables with these subsidiaries during the year.
In response to Covid the Government allowed payments of VAT
between 20 March 2020 and 30 June 2020 to be deferred. Under this
scheme, in prior year, the Group deferred a total of GBP1,000,000
VAT payments, which is included in social security and other taxes
above. The Group re-paid the full amount in instalment payments
from March to November 2021.
At 31 December 2020, trade payables and other payables included
GBP61,000 and GBP244,000 respectively, relating to discontinued
operations. No amounts relate to discontinued operations as at 31
December 2021.
The Directors consider that the carrying amount of the trade
payables approximates their fair value.
18 Lease liabilities
The lease liability currently held by the Group relates to a
property lease, for which a corresponding right-of-use ('ROU')
asset is held on the consolidated statement of financial position
within property, plant and equipment and detailed in note 12.
2021 2020
Group Group
GBP'000 GBP'000
----------------------------------- -------- --------
At 1 January 3,375 4,260
Remeasurement of lease liabilities 978 1,704
Interest expense 67 124
Cash outflow (2,036) (1,925)
Disposal on exit of lease - (788)
----------------------------------- -------- --------
At 31 December 2,384 3,375
----------------------------------- -------- --------
Current 1,884 1,969
Non-current 500 1,406
----------------------------------- -------- --------
At 31 December 2,384 3,375
----------------------------------- -------- --------
The lease liability for the Group's property in London was
remeasured during the year upon reassessment of the lease term,
resulting in an increase of GBP978,000. The amount of the
remeasurement of the lease liability was recognised as an
adjustment to the ROU asset.
During the prior year, the lease liability for the Group's
property in London was remeasured upon reassessment of the lease
term and renegotiation of payment terms due to Covid, resulting in
an increase of GBP1,704,000. The amount of the remeasurement of the
lease liability was recognised as an adjustment to the ROU
asset.
The lease liability for the Group's property in Portsmouth,
which was the office for the MarketMakers' business, was fully
released during prior year upon the cessation of the MarketMakers'
telemarketing business.
The gain on disposal of the lease liability was recognised in
the consolidated statement of comprehensive income in the prior
year, with GBP165,000 recognised in continuing operations for the
proportion of the liability related to the continuing Really B2B
business, and GBP623,000 recognised in discontinued operations
related to the proportion of the liability that related to the
discontinued telemarketing business. The corresponding ROU asset
was also disposed of (see note 12), with the resulting net gain on
disposal of GBP195,000 being materially offset by the exit penalty
incurred.
19 Deferred income
2021 2020
Group Group
GBP'000 GBP'000
---------------- -------- --------
Deferred income 7,846 7,048
---------------- -------- --------
Deferred income arises on contracts with customers where revenue
recognition criteria has not yet been met. See note 1(e) for
further details.
20 Current tax assets
2021 2020
Group Group
GBP'000 GBP'000
---------------------------- -------- --------
Corporation tax receivables 195 182
---------------------------- -------- --------
The Company had no corporation tax receivables or payables at 31
December 2021 (2020: GBPnil).
21 Provisions
Restructuring Other Total
Group GBP'000 GBP'000 GBP'000
----------------------------------------- ------------- -------- --------
At 1 January 2020 - 50 50
Additions 1,031 - 1,031
Utilised in the year (1,031) (50) (1,081)
----------------------------------------- ------------- -------- --------
At 31 December 2020 and 31 December 2021 - - -
----------------------------------------- ------------- -------- --------
Restructuring
During the prior year, a restructuring provision of GBP793,000
was recognised in relation to restructuring the MarketMakers
business following a sharp fall in revenue as several major
customers were hit by disruption in their own markets. A further
GBP238,000 was provided in relation to restructuring other parts of
the wider Centaur group due to the adverse impact of Covid. The
provision was fully utilised in the second half of 2020. The
associated expense was recognised within exceptional costs and
presented as adjusting items as disclosed within note 4. In 2020,
the staff related restructuring costs in continuing operations was
GBP238,000 and in discontinued operations was GBP793,000.
Other
The other provision in the prior year related to the
dilapidation provision which was acquired on the acquisition of
MarketMakers in relation to the building leased by the company in
Portsmouth. This provision was utilised during the prior year as
part of the exit of the Portsmouth lease upon cessation of
MarketMakers' telemarketing business. The associated expense was
recognised within discontinued exceptional costs and presented as
adjusting items as disclosed within note 4.
There were no provisions as at 31 December 2021.
22 Equity
Nominal
value Number of
Ordinary shares of 10p each GBP'000 shares
--------------------------------------------------------- -------- -----------
Authorised share capital - Group and Company
At 1 January 2020, 31 December 2020 and 31 December 2021 20,000 200,000,000
--------------------------------------------------------- -------- -----------
Issued and fully paid share capital - Group and Company
At 1 January 2020, 31 December 2020 and 31 December 2021 15,141 151,410,226
--------------------------------------------------------- -------- -----------
Deferred shares reserve
The deferred shares reserve represents 800,000 (2020: 800,000)
deferred shares of 10p each, which carry restricted voting rights
and have no right to receive a dividend payment in respect of any
financial year.
Reserve for shares to be issued
The reserve for shares to be issued is in respect of
equity-settled share-based compensation plans. The movements in the
reserve for shares to be issued represent the total charges for the
year relating to equity-settled share-based payment transactions
with employees as accounted for under IFRS 2 less transfers from
this reserve to retained earnings for shares exercised or lapsed
during the year.
During the prior year a transfer of GBP957,000 was made from the
reserve to retained earnings for lapsed share awards relating to
the TSR performance condition of long-term incentive plans.
Own shares reserve
The own shares reserve represents the value of shares held as
treasury shares and in the Employee Benefit Trust. At 31 December
2021, 4,550,179 (2020: 4,550,179) 10p ordinary shares are held in
treasury and 2,064,185 (2020: 1,948,492) 10p ordinary shares are
held in the Employee Benefit Trust.
The Employee Benefit Trust issued 981,783 (2020: 2,038,736)
shares to meet obligations arising from share-based rewards to
employees that had vested and were exercised in the current year
(2020: vested in 2020 and 2019 and were exercised in 2020). The
shares were issued at a historical weighted average cost of 92.9p
(2020: 61.3p) per share. The total cost of GBP912,000 (2020:
GBP1,341,000) has been recognised as a reduction in the own shares
reserve in other reserves in equity.
During 2021, the Employee Benefit Trust purchased 1,097,476
(2020: nil) ordinary shares in order to meet future obligations
arising from share-based rewards to employees. The shares were
acquired at an average price of 43.8p per share, with prices
ranging from 39.9p to 50.8p. The total cost of GBP481,000 (2020:
GBPnil) has been recognised in the own shares reserve in
equity.
During 2020, 2,414,434 shares were transferred out of treasury
to the Employee Benefit Trust in order to meet future obligations
arising from share-based rewards to employees. The shares were
transferred from treasury at the historical weighted average cost
of GBP2,195,000 (90.9p per share) and acquired by the Employee
Benefit Trust at the market value of GBP604,000 (25.0p per share).
The difference between the historical weighted average cost and the
market value of GBP1,591,000 has been eliminated on
consolidation.
23 Share-based payments
The Group's share-based payment expense for the year by
plan:
2021 2020
GBP'000 GBP'000
Long-Term Incentive Plan ('LTIP') 488 537
Share Incentive Plan ('SIP') 7 4
---------------------------------- -------- --------
Share-based payment expense 495 541
---------------------------------- -------- --------
The share-based payment expense is presented as an adjusting
item in note 4 (see note 1(b) for further information) and is
included in net operating expenses in the consolidated statement of
comprehensive income.
The Group's share-based payment plans upon vesting are
equity-settled.
The share-based payment expense includes social security costs
which are settled in cash upon exercise.
Long-Term Incentive Plan
The Group operates a Long-Term Incentive Plan ('LTIP') for
Executive Directors and selected senior management. This is an
existing incentive policy and was approved by shareholders at the
2016 AGM. The share awards are valued at date of grant and the
consolidated statement of comprehensive income is charged over the
vesting period, taking into account the number of shares expected
to vest. Full details on how the plan operates are included in the
Remuneration Report.
During the year LTIP awards were granted to Executive Directors
and selected senior management. Details of the performance
conditions of these awards are disclosed in the Remuneration
Report.
A reconciliation of the movements in LTIP awards is shown
below.
LTIP 2016 LTIP 2016 LTIP 2016 LTIP 2016 LTIP 2016
---------- ---------- ---------- ---------- ----------
Grant date 29.04.2021 25.03.2021 30.06.2020 03.10.2019 25.10.2019
Number of awards
Balance at 1 January 2021 - - 2,074,782 995,259 48,050
Granted during the year 1,187,076 1,798,489 - - -
Forfeited during the year (82,025) (161,198) (187,272) - -
Exercised during the year - - - - -
Lapsed during the year - - - - -
---------- ---------- ---------- ---------- ----------
Balance at 31 December 2021 1,105,051 1,637,291 1,887,510 995,259 48,050
---------- ---------- ---------- ---------- ----------
Exercisable at 31 December 2021 - - - - -
---------- ---------- ---------- ---------- ----------
Weighted average share price at date of exercise (p) - - - - -
---------- ---------- ---------- ---------- ----------
Balance at 1 January 2020 - - - 995,259 128,133
Granted during the year - - 2,074,782 - -
Forfeited during the year - - - - (80,083)
Exercised during the year - - - - -
Lapsed during the year - - - - -
---------- ---------- ---------- ---------- ----------
Balance at 31 December 2020 - - 2,074,782 995,259 48,050
---------- ---------- ---------- ---------- ----------
Exercisable at 31 December 2020 - - - - -
---------- ---------- ---------- ---------- ----------
Weighted average share price at date of exercise (p) - - - - -
---------- ---------- ---------- ---------- ----------
No options expired during the year (2020: nil).
These awards were priced using the following models and inputs:
Grant date 29.04.2021 25.03.2021 30.06.2020 03.10.2019 25.10.2019
---------- ---------- ---------- ---------- ----------
Share price at grant date 39.78 39.50 24.00 41.50 32.50
Fair value 29.09 30.10 14.80 22.77 16.25
Vesting date 29.04.2024 25.03.2024 29.06.2023 02.10.2022 05.04.2022
Exercise price (p) GBPnil GBPnil GBPnil GBPnil GBPnil
---------- ---------- ---------- ---------- ----------
Expected volatility (%) 48.9 48.0 47.0 40.0 -
Expected dividend yield (%) 1.29 1.30 - - -
Risk free interest rate (%) (0.12) (0.07) (0.09) 0.34 -
Valuation of model used Stochastic Stochastic Stochastic Stochastic *
---------- ---------- ---------- ---------- ----------
LTIP 2016 LTIP 2016 LTIP 2016 LTIP 2016 LTIP 2016
---------- ----------- --------------- ---------- ----------
Grant date 25.07.2019 06.04.2018 06.04.2018 24.04.2017 07.04.2017
Number of awards
Balance at 1 January 2021 2,156,512 1,246,879 981,776 - -
Granted during the year - - - - -
Forfeited during the year (165,598) - - - -
Exercised during the year - - (981,776) - -
Lapsed during the year - (1,246,879) - - -
---------- ----------- --------------- ---------- ----------
Balance at 31 December 2021 1,990,914 - - - -
---------- ----------- --------------- ---------- ----------
Exercisable at 31 December 2021 - - - - -
---------- ----------- --------------- ---------- ----------
Weighted average share price at date of exercise
(p) - - 42.01 - -
---------- ----------- --------------- ---------- ----------
Balance at 1 January 2020 2,236,640 1,246,879 1,963,191 675,764 381,557
Granted during the year - - - - -
Forfeited during the year (80,128) - - - -
Exercised during the year - - (981,415) (675,764) (381,557)
Lapsed during the year - - - - -
---------- ----------- --------------- ---------- ----------
Balance at 31 December 2020 2,156,512 1,246,879 981,776 - -
---------- ----------- --------------- ---------- ----------
Exercisable at 31 December 2020 - - - - -
---------- ----------- --------------- ---------- ----------
Weighted average share price at date of exercise
(p) - - 24.19 25.50 26.65
---------- ----------- --------------- ---------- ----------
No options expired during the year (2020: nil).
These awards were priced using the following models and inputs:
Grant date 25.07.2019 6 .04.2018 6 .04.2018 24.04.2017 07.04.2017
---------- ----------- --------------- ---------- ----------
Share price at grant date 46.00 50.20 50.20 45.75 40.75
Fair value 23.00 28.65 25.10 24.46 21.08
Vesting date 05.04.2022 06.04.2021 06.04.2021 24.04.2020 07.04.2020
Exercise price (p) GBPnil GBPnil GBPnil GBPnil GBPnil
---------- ----------- --------------- ---------- ----------
Expected volatility (%) - 43.5 43.5 45.4 45.4
Expected dividend yield (%) - - 6.47 - -
Risk free interest rate (%) - 0.86 0.86 0.12 0.12
Valuation of model used * Stochastic Black - Scholes Stochastic Stochastic
---------- ----------- --------------- ---------- ----------
* Shares granted on 25 October 2019 and 25 July 2019 were
nil-cost options with non-market-based performance conditions.
These plans were valued based on the estimated vesting value of the
non-market-based conditions and expected forfeiture rates
The plans above also include non-market based performance
conditions. These elements of the plans were valued based on the
estimated vesting value of the non-market based conditions and
expected forfeiture rates.
The share awards outstanding at 31 December 2021 had a weighted
average exercise price of GBPnil (2020: GBPnil) and a weighted
remaining life of 1.3 years (2020: 1.3 years).
Senior Executive Long-Term Incentive Plan ('SELTIP')
The Centaur Media Plc 2010 Senior Executive Long-Term Incentive
Plan (the 'SELTIP') was introduced during 2011 and was approved by
shareholders at the 2010 AGM. This is not an HMRC approved scheme
and vests over a three-year period with service and performance
conditions. Awards were granted under this plan in 2011 for no
consideration and no exercise price. This plan is closed to new
awards.
Awards of bonus units were made in 2013 as summarised in the
following table:
Number
of shares
Total awarded
Financial Threshold PBTA Profit SELTIP bonus Bonus pool in
year profit achieved growth contribution pool allocated* total**
---------- ---------- ---------- -------- -------------- ------- ----------- ----------
2013 GBP8.0m GBP8.6m GBP0.6m 30% GBP0.1m GBP0.1m 118,851
---------- ---------- ---------- -------- -------------- ------- ----------- ----------
* The Remuneration Committee did not allocate the entire bonus pool in 2013.
** Awards were only made to participants with continuing employment.
These awards were priced using the following models and
inputs:
SELTIP
2013
----------------------------------------------------------------- --------
Grant date 15.09.11
Share price at grant date 33.88
Fair value 23.76
Vesting date 17.09.14
Exercise price (p) GBPnil
----------------------------------------------------------------- --------
Number of awards
Balance at 1 January 2020, 31 December 2020 and 31 December 2021 6,862
----------------------------------------------------------------- --------
Exercisable at 31 December 2020 and 31 December 2021 6,862
----------------------------------------------------------------- --------
Average share price at date of exercise (p) -
----------------------------------------------------------------- --------
There were no grants, forfeitures, exercises, lapses, or expired
options during the current and prior years.
The share awards outstanding at 31 December 2021 had a weighted
average exercise price of GBPnil (2020: GBPnil) and a weighted
remaining life of 0.7 years (2020: 1.7 years).
Share Incentive Plan
The Group has a Share Incentive Plan, which is an HMRC approved
Tax-Advantaged plan, which provides employees with the opportunity
to purchase shares in the Company. This plan is open to all
employees who have been employed by the Group for more than 3
months. Employees may invest up to GBP1,800 per annum (or 10% of
their salary if less) in ordinary shares in the Company, which are
held in trust. The shares are purchased in open market and are held
in trust for each employee. The shares can be withdrawn with tax
paid at any time, or tax-free after five years. The Group matches
the contribution with a ratio of one share for every two purchased.
Other than continuing employment, there are no other performance
conditions attached to the plan.
The Executive Directors are eligible to participate in the Share
Incentive Plan, as are all employees of the Group.
2021 2020
Number of outstanding matching shares 57,495 58,117
--------------------------------------- ------ ------
24 Dividends
2021 2020
GBP'000 GBP'000
------------------------------------------------------- -------- --------
Equity dividends
Final dividend for 2020: 0.5p per 10p ordinary share 726 -
Interim dividend for 2021: 0.5p per 10p ordinary share 724 -
------------------------------------------------------- -------- --------
1,450 -
------------------------------------------------------- -------- --------
The total dividend pertaining to 2020 was the final dividend for
the year ended 31 December 2020 of GBP726,000 (0.5p share). This
dividend was paid on 28 May 2021.
An interim dividend for the six months ended 30 June 2021 of
GBP724,000 (0.5p per ordinary share) was paid on 22 October 2021 to
all ordinary shareholders on the register as at close of business
on 8 October 2021.
A final dividend for the year ended 31 December 2021 of
GBP725,000 (0.5p share) is proposed by the Directors and subject to
shareholder approval at the Annual General Meeting, will be paid on
27 May 2022 to all ordinary shareholders on the register at the
close of business on 13 May 2022.
During the prior year, the Company received a dividend of
GBP40,000,000 from Centaur Communications Limited. No dividends
were received in the current year.
25 Notes to the cash flow statement
Reconciliation of profit / (loss) for the year to cash generated
from operating activities:
2021 2020 2021 2020
Group Group Company Company
Note GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------------- -------- -------- -------- -------- --------
Profit / (loss) for the year 1,417 (14,428) (2,325) (27,828)
Adjustments for:
Tax 7 (56) (1,232) (512) (433)
Net interest expense 2,6 260 332 1,182 838
Depreciation 12 1,808 2,207 - -
Impairment of property, plant and
equipment 12 - - - -
Amortisation of intangible assets 11 2,426 3,780 - -
Impairment of intangible assets 11 80 - - -
Impairment of goodwill 10 - 11,009 - -
Loss on disposal of assets and liabilities 11,12,18 - 731 - -
Loss on impairment of investment 13 - - - 25,393
Share-based payment charge 5,23 495 541 325 (15)
Dividends waived 2 - 2 -
Dividends received from subsidiaries 24 - - - 40,000
Unrealised foreign exchange differences (65) 83 - -
Changes in working capital:
(Increase) / decrease in trade and
other receivables (259) 4,445 34,359 (34,050)
Increase / (decrease) in trade and
other payables 2,615 (3,732) (31,389) (3,750)
Increase / (decrease) in deferred
income 798 (1,671) - -
------------------------------------------- -------- -------- -------- -------- --------
Cash generated from operating activities 9,521 2,065 1,642 155
------------------------------------------- -------- -------- -------- -------- --------
Reconciliation of movements of liabilities and associated assets
to cash flows arising from financing activities:
Group and
Company Group
Net borrowings Lease liabilities
Note GBP'000 GBP'000
---------------------------------------------- ---- --------------- ------------------
At 1 January 2020 (132) 4,260
Changes from financing cash flows:
Loan arrangement fee (25) -
Interest paid (130) -
Repayment of obligations under finance leases 18 - (1,925)
(155) (1,925)
Other changes:
Interest expense 6 215 124
Remeasurement of lease liabilities 18 - 1,704
Disposal on exit of lease 18 - (788)
---------------------------------------------- ---- --------------- ------------------
215 1,040
---------------------------------------------- ---- --------------- ------------------
Balance at 31 December 2020 (72) 3,375
Changes from financing cash flows:
Loan arrangement fees (107) -
Interest paid (87) -
Repayment of obligations under finance leases 18 - (2,036)
(194) (2,036)
Other changes:
Interest expense 6 194 67
Remeasurement of lease liabilities 18 - 978
---------------------------------------------- ---- --------------- ------------------
194 1,045
---------------------------------------------- ---- --------------- ------------------
Balance at 31 December 2021 (72) 2,384
---------------------------------------------- ---- --------------- ------------------
Net borrowings is comprised of a loan arrangement fee debtor of
GBP75,000 (2020: GBP79,000) presented within other receivables on
the statement of financial position and a commitment fee creditor
of GBP3,000 presented as bank and other borrowings on the statement
of financial position (2020: GBP7,000). The movements of this asset
and liability together give rise to cash flows from financing
activities relating to the GBP25m revolving credit facility.
26 Financial instruments and financial risk management
Financial risk management
The Board has overall responsibility for the determination of
the Group's risk management policies. The Board receives monthly
reports from the Chief Financial Officer through which it reviews
the effectiveness of policies and processes put in place to manage
risk. The Board sets policies that reduce risk as far as possible
without unduly affecting the operating effectiveness of the
Group.
The Group's activities expose it to a variety of financial
risks, including interest rate risk, credit risk, liquidity risk,
capital risk and currency risk. Of these, credit risk and liquidity
risk are considered the most significant. This note presents
information about the Group's exposure to each of the above
risks.
Categories of financial instruments
Details of the significant accounting policies and methods
adopted, including the criteria for recognition, the basis of
measurement and the basis on which income and expenses are
recognised in respect of each class of financial asset, financial
liability and equity instrument are disclosed in note 1(s). All
financial assets and liabilities are measured at amortised
cost.
2021 2020
Note GBP'000 GBP'000
------------------------ ---- -------- --------
Financial assets
Cash and bank balances 16 13,065 8,300
Trade receivables - net 15 4,911 4,218
Other receivables 15 411 677
------------------------ ---- -------- --------
18,387 13,195
------------------------ ---- -------- --------
Financial liabilities
Lease liabilities 18 2,384 3,375
Trade payables 17 1,070 219
Accruals 17 8,112 5,652
Provisions 21 - -
Other payables 17 1,337 1,574
------------------------ ---- -------- --------
12,903 10,820
------------------------ ---- -------- --------
Credit risk
The Group's principal financial assets are trade and other
receivables (note 15). Credit risk refers to the risk that a
counterparty will default on its contractual obligations resulting
in financial loss to the Group. The carrying amount of financial
assets recorded in the financial information, which is net of
impairment losses, represents the Group's maximum exposure to
credit risk in relation to financial assets. Credit risk is managed
on a Group basis. The Group does not consider that it is subject to
any significant concentrations of credit risk.
Trade receivables
Trade receivables consist of a large number of customers, of
varying sizes and spread across diverse industries and geographies.
The Group does not have significant exposure to credit risk in
relation to any single counterparty or group of counterparties
having similar characteristics. The Group's exposure to credit risk
is influenced predominantly by the circumstances of individual
customers as opposed to industry or geographic trends.
The business assesses the credit quality of customers based on
their financial position, past experience and other qualitative and
quantitative factors. The Group's policy requires customers to pay
in accordance with agreed payment terms, which are generally 30
days from the date of invoice. Under normal trading conditions, the
Group is exposed to relatively low levels of risk and potential
losses are mitigated as a result of a diversified customer base and
the requirement for events and certain premium content subscription
invoices to be paid in advance of service delivery.
The credit control function within the Group's finance
department monitors the outstanding debts of the Group and trade
receivable balances are analysed by the age and value of
outstanding balances.
Any trade receivable balance which is objectively determined to
be uncollectible is written off the ledger, with a charge taken
through the consolidated statement of comprehensive income. The
Group also records an allowance for the lifetime expected credit
loss on its trade receivables balances under the simplified
approach as mandated by IFRS 9. The impairment model for trade
receivables, under IFSR 9, requires the recognition of impairment
provisions based on expected lifetime credit losses rather than
only incurred ones. All balances past due are reviewed with those
greater than 90 days past due considered to carry a higher level of
credit risk. Refer to note 1(s) for further details on the approach
to allowance for expected credit losses on trade receivables.
The allowance for expected lifetime credit losses, and changes
to it, are taken through administrative expenses in the
consolidated statement of comprehensive income.
The ageing of trade receivables according to their original due
date is detailed below:
2021 2021 2020 2020
Gross Provision Gross Provision
GBP'000 GBP'000 GBP'000 GBP'000
---------------------- -------- ---------- -------- ----------
Not due 3,488 (43) 3,265 (76)
0-30 days past due 972 (25) 598 (26)
31-60 days past due 161 (9) 140 (10)
61-90 days past due 146 (16) 167 (39)
Over 90 days past due 708 (471) 1,041 (842)
---------------------- -------- ---------- -------- ----------
5,475 (564) 5,211 (993)
---------------------- -------- ---------- -------- ----------
Trade receivables that are less than 3 months past due are
generally not considered to be impaired, except where specific
credit issues or delinquency in payments have been identified. In
making the assessment that unprovided trade receivables are not
impaired, the Directors have considered the quantum of gross trade
receivables which relate to amounts not yet included in income,
including amounts in deferred income and amounts relating to VAT.
The credit quality of trade receivables not yet due nor impaired
has been assessed as acceptable.
The movement in the allowance for expected credit losses on
trade receivables is detailed below:
2021 2021 2021 2020 2020 2020
Continuing Discontinued Total Continuing Discontinued Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------------ ----------- ------------- -------- ----------- ------------- --------
Balance at 1 January 879 114 993 729 378 1,107
Utilised (276) (114) (390) (134) (24) (158)
Additional provision charged to the
statement of comprehensive income - - - 255 - 255
Release (39) - (39) - (241) (241)
Written back - - - 29 1 30
------------------------------------------ ----------- ------------- -------- ----------- ------------- --------
Balance at 31 December 564 - 564 879 114 993
------------------------------------------ ----------- ------------- -------- ----------- ------------- --------
The Group's policy requires customers to pay in accordance with
agreed payment terms which are generally 30 days from the date of
invoice or in the case of live events related revenue no less than
30 days before the event. All credit and recovery risk associated
with trade receivables has been provided for in the consolidated
statement of financial position. The Group's policy for recognising
an impairment loss is given in note 1(s)(ii). Impairment losses are
taken through administrative expenses in the consolidated statement
of comprehensive income.
The remaining provision in prior year of GBP114,000 for
discontinued operations related to MarketMakers trade debtors which
was fully provided for as at 31 December 2020. This was fully
utilised in the current year.
The Directors consider the carrying value of trade and other
receivables approximates to their fair value.
Cash and cash equivalents
Banks and financial institutions are independently rated by
credit rating agencies. We choose only to deal with those with a
minimum 'A' rating. We determine the credit quality for cash and
cash equivalents to be strong.
Other receivables
Other receivables are neither past due nor impaired. These are
primarily made up of sundry receivables, including employee-related
debtors and receivables in respect of distribution
arrangements.
Liquidity risk
Liquidity risk is the risk that the Group will not be able to
meet its financial obligations as they fall due. The Group manages
liquidity risk by maintaining adequate reserves and working capital
credit facilities, and by continuously monitoring forecast and
actual cash flows. In March 2021, the Group terminated its existing
GBP25m multi-currency revolving credit facility with NatWest and
Lloyds which was due to run to November 2021. It has been replaced
by a new multi-currency revolving credit facility with NatWest
which runs to March 2024 with the option to extend for two periods
of one year each. The new facility consists of a GBP10m committed
facility and an additional GBP15m uncommitted accordion option,
both of which can be used to cover the Group's working capital and
general corporate needs. As at 31 December 2021, the Group had cash
of GBP13,065,000 (2020: GBP8,300,000) with a full undrawn loan
facility of GBP25m (2020: full undrawn loan facility of
GBP25m).
The following tables detail the financial maturity for the
Group's financial liabilities:
Less than
Book value Fair value 1 year 2-5 years
GBP'000 GBP'000 GBP'000 GBP'000
---------------------- ---------- ---------- --------- ---------
At 31 December 2021
Financial liabilities
Interest bearing 2,384 2,384 1,884 500
Non-interest bearing 10,519 10,519 10,519 -
---------------------- ---------- ---------- --------- ---------
12,903 12,903 12,403 500
---------------------- ---------- ---------- --------- ---------
At 31 December 2020
Financial liabilities
Interest bearing 3,375 3,375 1,969 1,406
Non-interest bearing 7,445 7,445 7,445 -
---------------------- ---------- ---------- --------- ---------
10,820 10,820 9,414 1,406
---------------------- ---------- ---------- --------- ---------
The Directors consider that book value is materially equal to
fair value.
The book value of primary financial instruments approximates to
fair value where the instrument is on a short maturity or where
they bear interest at rates that approximate to the market.
The following table details the level of fair value hierarchy
for the Group's financial assets and liabilities:
Financial Assets Financial Liabilities
----------------------- ---------------------
Level 1 Level 3
Cash and bank balances Lease liabilities
Level 3 Trade payables
Trade receivables - net Accruals
Other receivables Provisions
Other payables
Borrowings*
*Borrowings are purely in relation to the Group's revolving
credit facility which is discussed above. The amount drawn down
from this facility at 31 December 2021 was GBPnil (2020:
GBPnil).
All trade and other payables are due for payment in one year or
less, or on demand.
Interest rate risk
The Group has no significant interest-bearing assets but is
exposed to interest rate risk when it borrows funds at floating
interest rates through its revolving credit facility. Borrowings
issued at variable rates expose the Group to cash flow interest
rate risk. The Group evaluates its risk appetite towards interest
rate risks regularly to manage interest rate risk in relation to
its revolving credit facility if deemed necessary.
The Group did not enter any hedging transactions during the
current or prior year and as at 31 December 2021 the only floating
rate to which the Group was exposed was LIBOR. The Group's exposure
to interest rates on financial assets and financial liabilities is
detailed in the liquidity risk section of this note.
Interest rate sensitivity
The Group has not drawn down from its revolving credit facility
in the current year or prior year therefore a sensitivity analysis
has not been performed.
Capital risk
The Group manages its capital to ensure that all entities in the
Group will be able to continue as a going concern while maximising
return to stakeholders, as well as sustaining the future
development of the business.
The capital structure of the Group consists of net cash, which
includes cash and cash equivalents (note 16), and equity
attributable to the owners of the parent, comprising issued share
capital (note 22), other reserves and retained earnings. The Board
also considers the levels of own shares held for employee share
plans and the ability to issue new shares for acquisitions, in
managing capital risk in the business.
For the whole of 2020, the Group benefited from its banking
facilities, renewed in November 2019 which ran until November 2021
with an option to extend for a further two periods of one year
each. Interest was calculated on LIBOR plus a margin dependent on
the Group's net leverage position, which was re-measured quarterly
in line with covenant testing. The Group's borrowings were subject
to financial covenants tested quarterly. The principal financial
covenants under the facility were the ratio of net debt to Adjusted
EBITDA (see note 1(b) for explanation and reconciliation of
Adjusted EBITDA) would not exceed 2.5:1 and the ratio of EBITDA to
net finance charges would not be less than 4:1. In July 2020, the
Group agreed with the banks to waive leverage and interest cover
covenants up to, and including, the testing periods to 30 September
2021. This was subject to minimum liquidity tests which were
reported monthly. At no point during the prior year did the Group
breach its covenants or its minimum liquidity tests.
From March 2021, the Group benefited from a new banking facility
with NatWest, which featured a committed GBP10m facility and an
additional uncommitted GBP15m accordion option, both of which can
be used to cover the Group's working capital and general corporate
needs. The facility is available until March 2024 with an option to
extend for a further two periods of one year each. Interest is
calculated on SONIA plus a margin dependent on the Group's net
leverage position, which is re-measured quarterly in line with
covenant testing. The Group's borrowings are subject to financial
covenants tested quarterly. The principal financial covenants under
the facility are that the ratio of net debt to Adjusted EBITDA (see
note 1(b) for explanation and reconciliation of Adjusted EBITDA)
shall not exceed 2.5:1 and the ratio of EBITDA to net finance
charges shall not be less than 4:1. At no point during the year did
the Group breach its covenants.
Currency risk
Substantially all the Group's net assets are in the United
Kingdom. Most of the revenue and profits are generated in the
United Kingdom and consequently foreign exchange risk is limited.
The Group continues to monitor its exposure to currency risk,
particularly as the business expands into overseas territories such
as North America, however the results of the Group are not
currently considered to be sensitive to movements in currency
rates.
27 Pension schemes
The Group contributes to individual and collective money
purchase pension schemes in respect of Directors and employees once
they have completed the requisite period of service. The charge for
the year in respect of these defined contribution schemes is shown
in note 5. Included within other payables is an amount of GBP76,000
(2020: GBP77,000) payable in respect of the money purchase pension
schemes.
28 Capital commitments
At 31 December 2021, the Group had no capital commitments (2020:
GBPnil).
29 Related party transactions
Group
Key management compensation is disclosed in note 5. There were
no other material related party transactions for the Group in the
current or prior year.
Company
The Company had the following transactions with subsidiaries
during the year.
i) Interest
During the year, interest was recharged from subsidiary
companies as follows:
2021 2020
GBP'000 GBP'000
--------------------- ------- -------
Net interest payable 988 623
--------------------- ------- -------
There were no borrowings at the year end.
The balances outstanding with subsidiary companies are disclosed
in notes 15 and 17.
ii) Dividends
During the prior year, the Company received a dividend of
GBP40,000,000 from its subsidiary, Centaur Communications Limited.
No dividends were received in the current year.
There were no other material related party transactions for the
Company in the current or prior year.
Audit exemption
For the year ended 31 December 2021, the Company has provided a
guarantee pursuant to sections 479A-C of Companies Act 2006 over
the liabilities of the following subsidiaries and, as such, they
are exempt from the requirements of the Act relating to the audit
of individual financial information, or preparation of individual
financial information, as appropriate, for this financial year.
Outstanding
Company liabilities
Name number GBP'000
----------------------------------- -------- ------------
Centaur Communications Limited 01595235 21,530
Chiron Communications Limited 01081808 -
E-consultancy.com Limited 04047149 2
Market Makers Incorporated Limited 05063707 -
Pro-Talk Limited 03939119 -
Taxbriefs Holdings Limited 03572069 -
Taxbriefs Limited 01247331 -
TheLawyer.com Limited 11491880 2,101
Xeim Limited 05243851 11,117
----------------------------------- -------- ------------
See note 13 for changes to subsidiary holdings during the
year.
30 Events after the reporting date
No material events have occurred after the reporting date.
FIVE YEAR RECORD (UNAUDITED)
2017* 2018* 2019 2020 2021
------------------------------------ ----- ------ ------ ------ -----
Revenue (GBPm) 64.7 50.3 39.6 32.4 39.1
Operating (loss) / profit (GBPm) (0.3) (20.3) (7.8) (2.3) 1.6
Adjusted operating profit / (loss)
(GBPm) 4.1 (2.2) (1.2) - 3.2
Adjusted operating profit / (loss)
margin 6% (4%) (3%) - 8%
(Loss) / profit before tax (GBPm) (0.7) (20.5) (8.1) (2.6) 1.4
Adjusted profit / (loss) before tax
(GBPm) 3.7 (2.4) (1.5) (0.3) 3.0
Adjusted diluted EPS (pence) 1.8 (1.4) 0.3 0.3 1.9
Ordinary dividend per share (pence) 3.0 3.0 1.5 0.5 1.0
Net operating cash flow (GBPm) 12.1 5.6 4.7 2.1 9.5
Average permanent headcount (FTE) 589 758 317 282 264
Revenue per head (GBP'000) 110 66 125 115 148
------------------------------------ ----- ------ ------ ------ -----
2017* 2018* 2019 2020 2021
Revenue by type GBPm GBPm GBPm GBPm GBPm
------------------------ ----- ----- ----- ----- -----
Premium Content 19.1 14.4 14.4 13.2 12.9
Marketing Services 1.9 4.5 4.3 2.9 3.3
Training and Advisory 8.0 8.0 7.6 8.5 12.6
Events 18.7 6.5 6.4 2.5 3.8
Marketing Solutions 9.3 4.6 4.6 4.2 5.0
Recruitment Advertising 3.5 2.7 2.3 1.1 1.5
Telemarketing Services 4.2 9.6 - - -
------------------------ ----- ----- ----- ----- -----
64.7 50.3 39.6 32.4 39.1
------------------------ ----- ----- ----- ----- -----
2017* 2018* 2019 2020 2021
Other GBPm GBPm GBPm GBPm GBPm
------------------------------------- ------ ------ ----- ------ -------
Goodwill and other intangible assets 94.2 78.1 61.2 46.1 44.2
Other assets and liabilities (13.4) (11.5) (9.4) (7.2) (10.2)
------------------------------------- ------ ------ ----- ------ -------
Net assets before net cash 80.8 66.6 51.8 38.9 34.0
Net cash 4.1 0.1 9.3 8.3 13.1
------------------------------------- ------ ------ ----- ------ -------
Total equity 84.9 66.7 61.1 47.2 47.1
------------------------------------- ------ ------ ----- ------ -------
* 2017-2018 have not been re-presented with regards to
discontinued operations relating to the cessation of the
MarketMakers telemarketing business in 2020.
Marketing and Advertising Solutions revenue was split into
Marketing Solutions and Recruitment Advertising in the prior
year.
Directors, Advisers and Other Corporate Information
Company registration number
04948078
Incorporated / domiciled in
England and Wales
Registered office
Floor M
10 York Road
London
SE1 7ND
United Kingdom
Directors
Colin Jones (Chair)
Swagatam Mukerji (Chief Executive Officer)
Simon Longfield (Chief Financial Officer)
William Eccleshare
Carol Hosey
Leslie-Ann Reed
Company Secretary
Helen Silver
Independent Auditor
Crowe U.K. LLP
55 Ludgate Hill
London
EC4M 7JW
Registrars
Share Registrars Limited
3 The Millennium Centre
Crosby Way
Farnham
Surrey
GU9 7XX
External Lawyers
Dechert LLP
160 Queen Victoria Street
London
EC4V 4QQ
Brokers
Investec Bank plc
Singer Capital Markets
[1] Adjusted EBITDA is adjusted operating profit before
depreciation and amortisation. Adjusted results exclude adjusting
items detailed in note 4 of the financial information.
(2) Cash conversion is adjusted operating cash flows (excluding
one-off significant cash flows) divided by adjusted EBITDA.
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END
FR ZZGMFRKVGZZM
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March 16, 2022 03:00 ET (07:00 GMT)
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