TIDMPRO
RNS Number : 1715G
Progressive Digital Media Group PLC
02 March 2015
2 March 2015
For release
Progressive Digital Media Group Plc
Final Results For The Year Ended 31 December 2014
Highlights
Recent acquisitions performing well, whilst adverse exchange
rate movements impacted organic growth.
Key achievements in 2014
-- Revenue and earnings growth
-- Acquisition of Pyramid Research completed 1 January 2014
-- Acquisition of Current Analysis completed 30 July 2014
-- Cash and bank facilities to fund future growth
Financial performances
-- Group revenue increased by 16.2% to GBP63.2m (2013:
GBP54.3m)
-- Business Intelligence revenue increased by 17.6% to GBP38.5m
(2013: GBP32.7m)
-- Adjusted EBITDA(1) increased by 1.8% to GBP12.0m (2013:
GBP11.8m)
-- Adjusted EBITDA margin(1) decreased to 19.0% (2013:
21.7%)
-- Reported EBITDA(2) reduced by 62.0% to GBP3.8m (2013:
GBP9.9m)
-- Reported profit before tax from continuing operations of
GBP0.3m (2013: GBP7.3m) inclusive of GBP2.6m restructuring costs
and GBP4.4m share based payments charge
-- Group loss for the year of GBP2.2m, which includes tax and
loss from discontinued operations
-- Deferred Revenue increased by 50.3% to GBP21.5m (2013:
GBP14.3m)
-- Net (debt)/ cash(3) of (GBP8.7m) (2013: net cash of
GBP8.3m)
Our business
-- Premium business information services
-- A strong and scalable asset base
-- Significant contracted and visible revenue streams
-- Globally exploitable business model
Simon Pyper, Chief Executive of Progressive Digital Media Group
Plc, commented:
"We have during 2014 made good progress towards achieving our
objective of building an authoritative presence in the Global
Consumer and ICT business information markets. Additionally, we
have over the past year continued to invest in our content sets and
delivery platforms and as we start the new financial year we are
better placed than ever to serve our growing blue chip customer
base on a local, regional and global basis."
Note 1: Adjusted EBITDA: Earnings before interest, tax,
depreciation and amortisation, exchange rate losses, impairment,
share based payments, adjusted for costs associated with
derivatives, acquisitions, integration and restructure of the
Group. Adjusted EBITDA margin is defined as; Adjusted EBITDA as a
percentage of revenue.
Note 2: EBITDA: Earnings before interest, tax, depreciation,
amortisation and impairment. Includes a non-cash charge of GBP4.4
million for share based payments (2013: GBP1.1 million).
Note 3: Net (debt)/ cash: Cash and cash equivalents less short
and long-term borrowings.
Enquiries:
Progressive Digital Media Group Plc 0207 936 6400
Mike Danson, Chairman
Simon Pyper, Chief Executive
N+1 Singer 0207 496 3000
James Maxwell
Alex Wright
Hudson Sandler 0207 796 4133
Michael Sandler
CHAIRMAN'S STATEMENT
I am pleased to report results that show good revenue and
earnings growth, with revenues tempered by adverse exchange rates.
We have, during 2014, made progress towards achieving our key
strategic objective of becoming a leading provider of premium
business information to the Global Consumer and ICT markets. In
2014 we completed three acquisitions; one small "bolt-on" for our
Consumer proposition and two more substantial acquisitions which
address the ICT market. Additionally, we continued to re-engineer
the business and its processes, investing heavily in content sets
and delivery platforms which better serve the needs of our growing
blue chip customer base.
Our business model
We produce premium business information for the Global Consumer
and ICT markets. We supply our customers with research, analysis
and tactical intelligence across a multiple of platforms, which
enables our customers to gain a competitive advantage in their
markets. We have a simple business model, which is designed to
generate revenues off a relatively fixed operating cost base
allowing for operational gearing to drive profit growth and margin.
Its key features are:
1. Strong asset base with scalable business model - premium intelligence and customer datasets
2. Global coverage of consumer and technology information markets
3. Focus on subscription and contracted revenues - high quality
recurring income, with high barriers to entry and pricing power
Our employees
We work in a dynamic global market, with customer needs ever
changing and where success both today and in the future is entirely
dependent upon the professionalism, commitment and hard work of our
employees. On behalf of the Board I would like to thank our
employees for their contribution and to welcome those new employees
who have joined the Group from our recent acquisitions.
Current trading and outlook
We expect 2015 to be another year of progress, as we seek to
leverage our recent acquisitions and continue to invest in our
content and delivery platforms.
Mike Danson
Chairman
2 March 2015
CHIEF EXECUTIVE'S REVIEW
We have during 2014 made good progress towards achieving our
objective of building an authoritative presence in the Global
Consumer and ICT business information markets. Additionally, we
have over the past year continued to invest in our content sets and
delivery platforms and as we start the new financial year we are
better placed than ever to serve our growing blue chip customer
base on a local, regional and global basis.
Operational review
Group performance
Group revenues grew by 16.2% to GBP63.2m.
Business Intelligence revenues grew by 17.6% and now account for
61.0% of total revenues (2013: 60.3%). Over the medium term our
goal is to increase Business Intelligence revenues to 75.0% of
total Group revenues. Eliminating the benefit of our recent
acquisitions underlying revenues grew by 4.8% which reflects the
higher mix of non-sterling denominated revenues.
Events and Marketing revenues grew by 14.1% to GBP24.6m and now
account for 39.0% of total revenues (2013: 39.7%). The majority of
revenues in this area are denominated in sterling and thus not
subject to exchange rate movements.
Adjusted EBITDA grew by just under 2% to GBP12.0m (2013:
GBP11.8m) whilst Adjusted EBITDA margin decreased by 2.7% to 19.0%
(2013: 21.7%). Margins were adversely impacted by both the
part-year effect of our recent acquisitions and the effect of
exchange rates and in particular the strength of sterling against
both the US dollar and Euro from which the majority of Group
revenues derive.
Profit before tax from continuing operations decreased by
GBP7.0m to GBP0.3m (2013: GBP7.3m), which is after a GBP4.4m (2013:
GBP1.1m) non-cash charge for share based payments reflecting the
award of additional share options under the long term inventive
plan for senior management and the significant increase in share
price since the scheme was first introduced in January 2011. Profit
before tax also includes GBP2.6m of largely acquisition related
restructuring costs.
Loss for the year of GBP2.2m (2013: profit of GBP4.5m) is net of
tax and losses associated with discontinued operations.
Acquisitions
We completed three acquisitions during 2014, one "bolt-on"
acquisition addressing the Consumer market and two complementary
acquisitions which address the ICT market.
Pyramid Research and Current Analysis are two well-regarded and
complementary businesses which provide practical market
intelligence to leading professionals in the ICT sector. Pyramid
Research focuses on market and service opportunities, whilst
Current Analysis is focused on innovation and on how companies in
the ICT space can better compete. Both companies satisfy all of our
acquisition criteria, providing subscription based business
information services to blue chip companies operating in a global
sector.
Common Systems
The Group has a number of common systems and processes from
sales management, to content production and client delivery. We
seek to constantly improve these systems and processes in order to
drive improved efficiencies and operating margins. Moreover, these
common systems and processes ease expansion into new geographies
and reduce integration risk.
Looking ahead
We are a focused business with one clear goal: to become a
leading provider of premium business information to the Global
Consumer and ICT markets. Last year was a step in the right
direction; this year should prove to be another as we build on the
solid foundation we have established.
The key objectives for the forthcoming year are:
-- Focus on high-quality, subscription based Business Information services and products
-- Expand our sales footprint in high-growth Consumer and ICT markets
-- Integration, investment and growth from our recent acquisitions
We are an ambitious and growing company; that we have achieved
so much in such a relatively short period of time is testament to
the passion, commitment and contribution of our employees.
Simon Pyper
Chief Executive
2 March 2015
FINANCIAL REVIEW
Financially the Group has performed well with improved revenues
and earnings at an Adjusted level.
Financial highlights
-- Increased the Group's revenue by 16.2% year on year
-- Increased profitability at the Adjusted EBITDA level by 1.8%
-- Deferred revenue increased by GBP7.2m to GBP21.5m (2013:
GBP14.3m) as a result of acquisitions in the year combined with
strong sales towards the end of 2014
The increased share based payments charge of GBP4.4m (2013:
GBP1.1m) is largely related to additional options granted to
existing scheme members, new hires and employees joining the Group
via acquisitions.
2014 2013 Movement
Continuing operations GBP000s GBP000s
Revenue 63,161 54,342 16.2%
Profit before tax 294 7,283
Depreciation 547 562
Amortisation 2,425 1,725
Finance costs 484 311
------------------------------------------------ -------- -------- -----------
EBITDA(1) 3,750 9,881 (62.0%)
Restructuring costs 2,237 392
Property related provisions (221) (222)
Revaluation of short and long-term derivatives 15 (24)
Share based payments charge 4,371 1,127
Exceptional property costs 13 93
Unrealised foreign exchange loss 787 -
M&A costs 431 45
Deal costs 146 154
Exceptional legal costs - 141
Exchange rate losses 498 231
------------------------------------------------ -------- -------- -----------
Adjusted EBITDA(2) 12,027 11,818 1.8%
------------------------------------------------ -------- -------- -----------
Adjusted EBITDA margin(2) 19.0% 21.7%
------------------------------------------------ -------- -------- -----------
Note 1: EBITDA: Earnings before interest, tax, depreciation,
amortisation and impairment. Includes a non-cash charge of GBP4.4
million for share based payments (2013: GBP1.1 million).
Note 2: Adjusted EBITDA: Earnings before interest, tax,
depreciation and amortisation, exchange rate losses, impairment,
share based payments, adjusted for costs associated with
derivatives, acquisitions, integration and restructure of the
Group. Adjusted EBITDA margin is defined as: Adjusted EBITDA as a
percentage of revenue.
Earnings per share
Basic loss per share from continuing operations was (0.78) pence
per share (2013: earnings of 6.90 pence per share).
FINANCIAL REVIEW
Cash flow
The Group generated GBP12.0 million of Adjusted EBITDA in 2014,
which excludes GBP0.3 million paid in relation to onerous leases.
Working capital movements reduced the cash generated from
continuing operations to an inflow of GBP3.1 million.
Trade and other receivables were significantly higher than the
previous year at GBP33.0 million (2013: GBP24.9 million),
reflecting the balance sheet impact of the acquisitions made during
the year combined with strong sales towards the end of 2014 in line
with expectations. Banking facilities were renegotiated with The
Royal Bank of Scotland in the year, resulting in a cash inflow of
GBP10.0 million which was used to partially fund the acquisition of
Current Analysis Inc.
Capital expenditure (excluding balances in relation to
acquisitions) was GBP2.3 million in 2014 (GBP0.4 million in 2013).
This included GBP1.1 million on software (GBP0.1 million in
2013).
Currency rate risk
The Group's primary objective in managing foreign currency risk
is to protect against the risk that the eventual Sterling net cash
flows will be affected by changes in foreign currency exchange
rates. To do this, the Group enters into foreign exchange contracts
that limit the risk from movements in US dollar, Euro and Indian
Rupee exchange rates with Sterling. Whilst commercially this hedges
the Group's currency exposures, it does not meet the requirements
for hedge accounting and accordingly any movements in the fair
value of the foreign exchange contracts are recognised in the
income statement.
Liquidity risk and going concern
The Group's approach to managing liquidity risk is to ensure, as
far as possible, that it has sufficient liquidity to meet its
liabilities as they fall due with surplus facilities to cope with
any unexpected variances in timing of cash flows. The Group meets
its day-to-day working capital requirements through free cash flow.
The Group has an overdraft facility of GBP2 million, which was not
utilised as at 31 December 2014 and management do not forecast
utilisation of this facility in the next 18 months.
Based on cash flow projections, the Group considers the existing
financing facilities to be adequate to meet short-term commitments.
The Directors have a reasonable expectation that there are no
material uncertainties that cast significant doubt about the
Group's ability to continue as a going concern. Accordingly, the
Group has prepared the annual report and financial statements on a
going concern basis.
Simon Pyper
Chief Executive
2 March 2015
Consolidated Income Statement
Notes Year ended Year ended
31 December 31 December
2014 2013
GBP000s GBP000s
Continuing operations
Revenue 3 63,161 54,342
Cost of sales (39,294) (31,657)
------------------------------------------------ ------ ------------- -------------
Gross profit 23,867 22,685
Distribution costs (792) (878)
Administrative costs (12,991) (11,744)
Other expenses 4 (9,306) (2,469)
------------------------------------------------ ------ ------------- -------------
Operating profit 778 7,594
Analysed as:
Adjusted EBITDA(1) 12,027 11,818
Items associated with acquisitions and
restructure of the Group 4 (2,606) (603)
Exchange rate losses (498) (231)
Other adjusting items 4 (5,173) (1,103)
------------------------------------------------ ------ ------------- -------------
EBITDA(2) 3,750 9,881
Amortisation (2,425) (1,725)
Depreciation (547) (562)
------------------------------------------------ ------ ------------- -------------
Operating profit 778 7,594
------------------------------------------------ ------ ------------- -------------
Finance costs (484) (311)
Profit before tax from continuing operations 294 7,283
Income tax expense (887) (2,146)
------------------------------------------------ ------ ------------- -------------
(Loss)/ profit for the year from continuing
operations (593) 5,137
Loss for the year from discontinued
operations 9 (1,628) (633)
(Loss)/ profit for the year (2,221) 4,504
------------------------------------------------ ------ ------------- -------------
Attributable to:
Equity holders of the parent (2,106) 4,487
Non-controlling interest (115) 17
------------------------------------------------ ------ ------------- -------------
(Loss)/ earnings per share attributable
to equity holders from continuing operations: 5
Basic (loss)/ earnings per share (pence) (0.78) 6.90
Diluted (loss)/ earnings per share (pence) (0.70) 6.48
Loss per share attributable to equity
holders from discontinued operations:
Basic loss per share (pence) (1.99) (0.87)
Diluted loss per share (pence) (1.79) (0.82)
Total basic (loss)/ earnings per share
(pence) (2.77) 6.02
Total diluted (loss)/ earnings per share
(pence) (2.50) 5.66
------------------------------------------------ ------ ------------- -------------
1 We define Adjusted EBITDA as EBITDA adjusted for costs
associated with acquisition, integration, restructure of the Group,
share based payments, impairment, exchange rate losses and impact
of foreign exchange contracts. See note 4 of the preliminary
financial statements for details. We present Adjusted EBITDA as
additional information because we understand that it is a measure
used by certain investors and because it is used as the measure of
segment profit or loss. However, other companies may present
Adjusted EBITDA differently. EBITDA and Adjusted EBITDA are not
measures of financial performance under IFRS and should not be
considered as an alternative to operating profit or as a measure of
liquidity or an alternative to net income as indicators of our
operating performance or any other measure of performance derived
in accordance with IFRS.
2 EBITDA is defined as earnings before interest, tax,
depreciation, amortisation and impairment.
Consolidated Statement of Comprehensive Income
Year ended Year ended
31 December 31 December
2014 2013
GBP000s GBP000s
(Loss)/ profit for the year (2,221) 4,504
Other comprehensive income
Items that will be classified subsequently
to profit or loss:
Translation of foreign entities (166) 15
Other comprehensive (loss)/ income, net of
tax (166) 15
-------------------------------------------- ------------- -------------
Total comprehensive (loss)/ income for the
year (2,387) 4,519
-------------------------------------------- ------------- -------------
Attributable to:
Equity holders of the parent (2,272) 4,502
Non-controlling interest (115) 17
-------------------------------------------- ------------- -------------
Consolidated Statement of Financial Position
Notes 31 December 2014 31 December 2013
GBP000s GBP000s
Non-current assets
Property, plant and equipment 1,510 831
Intangible assets 42,403 24,807
Deferred tax assets 457 1,490
----------------------------------------------------- ---------- ------------------- ---------------------
44,370 27,128
----------------------------------------------------- ---------- ------------------- ---------------------
Current assets
Inventories 150 155
Trade and other receivables 33,049 24,877
Short-term derivative assets 106 6
Cash and cash equivalents 8,261 14,178
----------------------------------------------------- ---------- ------------------- ---------------------
41,566 39,216
----------------------------------------------------- ---------- ------------------- ---------------------
Total assets 85,936 66,344
----------------------------------------------------- ---------- ------------------- ---------------------
Current liabilities
Trade and other payables (32,567) (26,763)
Short-term borrowings 7 (1,283) -
Current tax payable (1,240) (917)
Short-term derivative liabilities (89) -
Short-term provisions (368) (644)
----------------------------------------------------- ---------- ------------------- ---------------------
(35,547) (28,324)
----------------------------------------------------- ---------- ------------------- ---------------------
Non-current liabilities
Long-term provisions (84) (58)
Long-term derivative liabilities (26) -
Long-term borrowings 7 (15,651) (5,851)
----------------------------------------------------- ---------- ------------------- ---------------------
(15,761) (5,909)
----------------------------------------------------- ---------- ------------------- ---------------------
Total liabilities (51,308) (34,233)
----------------------------------------------------- ---------- ------------------- ---------------------
Net assets 34,628 32,111
----------------------------------------------------- ---------- ------------------- ---------------------
Equity
Share capital 8 154 153
Share premium account 200 -
Other reserve (37,128) (37,128)
Special reserve 48,422 48,422
Foreign currency translation reserve (126) 40
Retained profit 23,106 20,508
----------------------------------------------------- ---------- ------------------- ---------------------
Equity attributable to equity holders of the parent 34,628 31,995
Non-controlling interest - 116
----------------------------------------------------- ---------- ------------------- ---------------------
Total equity 34,628 32,111
----------------------------------------------------- ---------- ------------------- ---------------------
Consolidated Statement of Changes in Equity
Share Share Other Foreign Retained Equity Non-controlling Total
capital premium reserve Special currency profit/ attributable interest equity
account reserve translation (loss) to equity
reserve holders
of the
parent
GBP000s GBP000s GBP000s GBP000s GBP000s GBP000s GBP000s GBP000s GBP000s
--------------------- --------- --------- --------- --------- ------------ --------- ------------- ---------------- --------
Balance at 1 January
2013 153 71,368 (37,128) - 25 (7,942) 26,476 107 26,583
---------------------- -------- --------- --------- --------- ------------ --------- ------------- ---------------- --------
Profit for the year - - - - - 4,487 4,487 17 4,504
Other comprehensive
income:
Translation of
foreign
entities - - - - 15 - 15 - 15
---------------------- -------- --------- --------- --------- ------------ --------- ------------- ---------------- --------
Total comprehensive
income for the year - - - - 15 4,487 4,502 17 4,519
---------------------- -------- --------- --------- --------- ------------ --------- ------------- ---------------- --------
Transactions with
owners:
Transfer between
reserves - 25 - - - (25) - - -
Capital reduction - (71,393) - 48,422 - 22,971 - - -
Dividends - - - - - - - (8) (8)
Share based
payments
charge - - - - - 1,127 1,127 - 1,127
Excess deferred
tax
on share based
payments - - - - - (110) (110) - (110)
---------------------- -------- --------- --------- --------- ------------ --------- ------------- ---------------- --------
Balance at 31
December
2013 153 - (37,128) 48,422 40 20,508 31,995 116 32,111
Loss for the year - - - - - (2,106) (2,106) (115) (2,221)
Other comprehensive
income:
Translation of
foreign
entities - - - - (166) - (166) - (166)
---------------------- -------- --------- --------- --------- ------------ --------- ------------- ---------------- --------
Total comprehensive
loss for the year - - - - (166) (2,106) (2,272) (115) (2,387)
---------------------- -------- --------- --------- --------- ------------ --------- ------------- ---------------- --------
Transactions with
owners:
Issue of share
capital:
ERC acquisition - 200 - - - - 200 - 200
Issue of share
capital:
Share based
payments
scheme 1 - - - - (1) - - -
Dividends - - - - - - - (1) (1)
Share based
payments
charge - - - - - 4,371 4,371 - 4,371
Excess deferred
tax
on share based
payments - - - - - 334 334 - 334
---------------------- -------- --------- --------- --------- ------------ --------- ------------- ---------------- --------
Balance at 31
December
2014 154 200 (37,128) 48,422 (126) 23,106 34,628 - 34,628
---------------------- -------- --------- --------- --------- ------------ --------- ------------- ---------------- --------
Consolidated Statement of Cash Flows
Year ended Year ended
31 December 31 December
Continuing operations 2014 2013
Cash flows from operating activities GBP000s GBP000s
(Loss)/ profit for the year from continuing
operations (593) 5,137
Adjustments for:
Depreciation 547 562
Amortisation 2,425 1,725
Finance costs 484 311
Taxation recognised in profit or loss 887 2,146
Profit on disposal of subsidiary (106) -
Loss on disposal of property, plant and
equipment 8 8
Revaluation of foreign currency loan 902 -
Share based payments charge 4,371 1,127
Increase in trade and other receivables (5,927) (7,544)
Decrease in inventories 5 25
Increase in trade payables 396 680
Revaluation of short and long-term derivatives 15 (24)
Movement in provisions (299) (642)
--------------------------------------------------- ------------- -------------
Cash generated from continuing operations 3,115 3,511
Interest paid (continuing operations) (220) (214)
Income taxes paid (continuing operations) (1,364) (623)
--------------------------------------------------- ------------- -------------
Net cash from operating activities (continuing
operations) 1,531 2,674
Net decrease in cash and cash equivalents
from discontinued operations (1,281) (114)
--------------------------------------------------- ------------- -------------
Total cash flows from operating activities 250 2,560
Cash flows from investing activities (continuing
operations)
Acquisition of Pyramid Research (2,006) -
Acquisition of ERC Group (543) -
Acquisition of Current Analysis Inc (11,168) -
Proceeds from disposal of subsidiary 58 -
Purchase of property, plant and equipment (1,212) (213)
Purchase of intangible assets (1,128) (149)
--------------------------------------------------- ------------- -------------
Net cash used in investing activities (continuing
operations) (15,999) (362)
Net increase/ (decrease) in cash and cash
equivalents from discontinued operations 4 (24)
--------------------------------------------------- ------------- -------------
Total cash flows from investing activities (15,995) (386)
Cash flows from financing activities (continuing
operations)
Repayment of short-term borrowings - (500)
Proceeds from long-term borrowings 10,000 -
--------------------------------------------------- ------------- -------------
Net cash used in financing activities (continuing
operations) 10,000 (500)
Net decrease in cash and cash equivalents
from discontinued operations (6) (8)
--------------------------------------------------- ------------- -------------
Total cash flows from financing activities 9,994 (508)
--------------------------------------------------- ------------- -------------
Net (decrease)/ increase in cash and cash
equivalents (5,751) 1,666
Cash and cash equivalents at beginning
of year 14,178 12,497
Effects of currency translation on cash
and cash equivalents (166) 15
--------------------------------------------------- ------------- -------------
Cash and cash equivalents at end of year 8,261 14,178
--------------------------------------------------- ------------- -------------
The accompanying notes form an integral part of this financial
report.
Notes to the Condensed Consolidated Financial Statements
1. General information
Basis of preparation
These condensed consolidated financial statements have been
prepared in accordance with International Financial Reporting
Standards (IFRS) and International Financial Reporting
Interpretations Committee (IFRIC) interpretations as adopted by the
European Union (EU).
The financial statements have been prepared under the historical
cost convention as modified by the revaluation of derivative
financial instruments. These condensed financial statements are for
the year ended 31 December 2014 and should be read in conjunction
with the Annual Report and Accounts for the year ended 31 December
2013 that was sent to all shareholders and is available on the
Company's website. These financial statements are presented in
Pounds Sterling (GBP).
This preliminary announcement does not constitute the Group's
full financial statements for the year ended 31 December 2014. The
auditors have reported on the Group's statutory accounts for the
year ended 31 December 2014 under s495 of the Companies Act 2006,
which do not contain statements under s498(2) or s498(3) of the
Companies Act 2006 and are unqualified. The statutory accounts for
the year ended 31 December 2014 will be filed with the Registrar of
companies in due course.
Critical accounting estimates and judgements
The Group makes estimates and assumptions regarding the future.
Estimates and judgements are continually evaluated based on
historical experience and other factors, including expectations of
future events that are believed to be reasonable under the
circumstances.
In the future, actual experience may deviate from these
estimates and assumptions. The estimates and assumptions that have
a significant risk of causing a material adjustment to the carrying
amounts of assets and liabilities within the next financial year
relate to valuation of acquired intangible assets, provisions for
bad debt, share based payments and carrying value of goodwill and
other intangibles.
Valuation of acquired intangibles
Management identified and valued acquired intangibles on
acquisitions that were made during the periods disclosed in the
financial statements. Management has applied judgements in
identifying and valuing intangible assets separate from goodwill
that consist of assessing the value of brands, software, IP rights
and customer relationships.
Provisions for bad debt
The Group is required to judge when there is sufficient
objective evidence to require the impairment of individual trade
receivables. It does this on the basis of the age of the relevant
receivables, external evidence of the credit status of the customer
entity and the status of any disputed amounts.
Share based payments
The Group operates a share based compensation plan under which
the entity receives services from employees as consideration for
equity instruments (options) of the Group. The fair value of the
employee services received in exchange for the grant of the options
and awards is recognised as an expense. The total amount to be
expensed is determined by reference to the fair value of the
options granted, excluding the impact of any non-market service and
performance vesting conditions (for example, profitability, sales
growth targets and remaining an employee of the entity over a
specified time period). Non-market vesting conditions are included
in assumptions about the number of options and awards that are
expected to vest. The total amount expensed is recognised over the
vesting period, which is the period over which all of the specified
existing conditions are to be satisfied. At each reporting date,
the entity revises its estimates of the number of options and
awards that are expected to vest based on the non-market vesting
conditions. It recognises the impact of the revision to original
estimates, if any, in the Income Statement, with a corresponding
adjustment to the share option reserve within equity.
Carrying value of goodwill and other intangibles
The carrying value of goodwill and other intangibles is assessed
at least annually to ensure that there is no need for impairment.
Performing this assessment requires management to estimate future
cash flows to be generated by the related cash generating unit,
which entails making judgements including the expected rate of
growth of sales, margins expected to be achieved, the level of
future capital expenditure required to support these outcomes and
the appropriate discount rate to apply when valuing future cash
flows.
Going concern
The Group meets its day-to-day working capital requirements
through free cash flow. The Group has an overdraft facility of GBP2
million, which was not utilised as at 31 December 2014 and
management do not forecast utilisation of this facility in the next
18 months.
Based on cash flow projections, the Group considers the existing
financing facilities to be adequate to meet short-term commitments.
The Directors have a reasonable expectation that there are no
material uncertainties that cast significant doubt about the
Group's ability to continue as a going concern. Accordingly, the
Group has prepared the annual report and financial statements on a
going concern basis.
2. Accounting policies
This report has been prepared based on the accounting policies
detailed in the Group's financial statements for the year ended 31
December 2014.
3. Segmental analysis
The principal activity of Progressive Digital Media Group Plc
(PDMG) and its subsidiaries ('the Group') is the provision of
premium business information through multiple channels. The Group
supplies its customers with research, analysis and tactical
intelligence enabling them to gain a competitive advantage in their
markets.
IFRS 8 "Operating Segments" requires the segment information
presented in the financial statements to be that which is used
internally by the chief operating decision maker to evaluate the
performance of the business and to decide how to allocate
resources. The Group has identified the executive directors as its
chief operating decision maker.
Business information is provided to customers through multiple
channels by a dedicated content team that is centrally managed by
research directors who report directly to the executive directors.
Business information is therefore considered to be the operating
segment of the Group.
The Group profit or loss is reported to the executive directors
on a monthly basis and consists of earnings before interest, tax,
depreciation, amortisation, central overheads and other adjusting
items. The executive directors also monitor revenue within the
operating segment and have decided to include an additional
voluntary disclosure analysing revenue by sub-category, being
Business Intelligence and Events and Marketing.
A reconciliation of Adjusted EBITDA to profit before tax from
continuing operations is set out below:
Year ended Year ended
31 December 31 December
2014 2013
GBP000s GBP000s
Business Intelligence 38,513 32,742
Events and Marketing 24,648 21,600
---------------------------------------------- ------------- -------------
Total Revenue 63,161 54,342
Adjusted EBITDA 12,027 11,818
Foreign exchange losses (498) (231)
Other expenses (see note 4) (9,306) (2,469)
Depreciation (547) (562)
Amortisation (excluding amortisation of
acquired intangible assets) (898) (962)
Finance costs (484) (311)
Profit before tax from continuing operations 294 7,283
---------------------------------------------- ------------- -------------
Geographical analysis
From continuing operations
Year ended 31 December 2014 UK Europe North America Rest of World Total
GBP000s GBP000s GBP000s GBP000s GBP000s
Revenue from external customers 17,906 22,447 15,640 7,168 63,161
--------------------------------- -------- -------- -------------- -------------- --------
Year ended 31 December 2013 UK Europe North America Rest of World Total
GBP000s GBP000s GBP000s GBP000s GBP000s
Revenue from external customers 16,543 20,157 11,961 5,681 54,342
--------------------------------- -------- -------- -------------- -------------- --------
4. Other expenses
Year ended Year ended
31 December 31 December
2014 2013
GBP000s GBP000s
Restructuring costs 2,237 392
Property related provisions (221) (222)
Exceptional property costs 13 93
Exceptional legal costs - 141
Deal costs 146 154
M&A costs 431 45
Items associated with acquisitions and
restructure of the Group 2,606 603
Share based payments charge 4,371 1,127
Revaluation of short and long-term derivatives 15 (24)
Unrealised foreign exchange loss 787 -
Amortisation of acquired intangibles 1,527 763
Total other expenses 9,306 2,469
------------------------------------------------ ------------- -------------
-- Restructuring costs relates to redundancies and other
restructuring, largely in relation to the integration of
acquisitions made during the year. Redundancies were announced
prior to 31 December 2014.
-- Property related provisions relate to the consolidated income
statement impact of the provision made for onerous property leases
and dilapidations.
-- Exceptional property costs relate to additional costs
incurred on properties that are not occupied and are provided for
within the onerous property lease provision.
-- Deal costs represent costs incurred in respect of the
refinancing of loans issued by the Royal Bank of Scotland in 2014
(see note 7).
-- The M&A costs relate to due diligence and corporate
finance activity during the year.
-- The share based payments charge relates to the share option plan (see note 6).
-- The revaluation of short and long-term derivatives relates to
movement in the fair value of the short and long-term
derivatives.
-- Unrealised foreign exchange loss relates to the retranslation
of short and long-term loan and trade receivable amounts
denominated in foreign currency which were held at 31 December
2014.
5. Earnings per share
The calculation of the basic earnings per share is based on the
earnings attributable to ordinary shareholders of the parent
company divided by the weighted average number of shares in issue
during the year. The Group has a share options scheme in place and
therefore the Group has calculated the dilutive effect of these
options. The below table shows earnings per share for both
continuing and discontinued operations:
Year ended Year ended
31 December 31 December
2014 2013
Continuing operations
Basic
(Loss)/ profit for the year attributable
to ordinary shareholders of the parent
company (GBP000s) (593) 5,137
Weighted average number of shares (000s) 75,941 74,487
Basic (loss)/ earnings per share (pence) (0.78) 6.90
Diluted
(Loss)/ profit for the year attributable
to ordinary shareholders of the parent
company (GBP000s) (593) 5,137
Weighted average number of shares* (000s) 84,300 79,262
Diluted (loss)/ earnings per share (pence) (0.70) 6.48
Discontinued operations
Basic
Loss for the year attributable to ordinary
shareholders from discontinued operations
(GBP000s) (1,628) (633)
Less minority interest (GBP000s) (115) 17
Loss for the year attributable to ordinary
shareholders of the parent company (GBP000s) (1,513) (650)
Weighted average number of shares (000s) 75,941 74,487
Basic loss per share (pence) (1.99) (0.87)
Diluted
Loss for the year attributable to ordinary
shareholders of the parent company (GBP000s) (1,513) (650)
Weighted average number of shares* (000s) 84,300 79,262
Diluted loss per share (pence) (1.79) (0.82)
----------------------------------------------- ------------- -------------
Total
Basic
(Loss)/ profit for the year attributable
to ordinary shareholders of the parent
company (GBP000s) (2,106) 4,487
Weighted average number of shares (000s) 75,941 74,487
Basic (loss)/ earnings per share (pence) (2.77) 6.02
Diluted
(Loss)/ profit for the year attributable
to ordinary shareholders of the parent
company (GBP000s) (2,106) 4,487
Weighted average number of shares* (000s) 84,300 79,262
Diluted (loss)/ earnings per share (pence) (2.50) 5.66
----------------------------------------------- ------------- -------------
Reconciliation of basic weighted average number of shares to the
diluted weighted average number of shares:
31 December 31 December
2014 2013
No'000s No'000s
Basic weighted average number of shares 75,941 74,487
Share options in issue at end of year 8,359 4,775
----------------------------------------- ------------ ------------
Diluted weighted average number of
shares 84,300 79,262
----------------------------------------- ------------ ------------
* The share options in issue are anti-dilutive in respect of the
diluted loss per share calculation in 2014.
6. Share based payments
The Group created a share option scheme during the year ended 31
December 2010 and granted the first options under the scheme on 1
January 2011 to certain senior employees. Each option granted
converts to one ordinary share on exercise. A participant may
exercise their options (subject to employment conditions) at any
time during a prescribed period from the vesting date to the date
the option lapses. For these options to be exercised the Group's
earnings before interest, taxation, depreciation and amortisation,
as adjusted by the Remuneration Committee for significant or
one-off occurrences, must exceed certain targets. The fair values
of options granted were determined using the market value at the
date of grant. The market values were compared to the Black-Scholes
model and there were no significant differences.
The following assumptions were used in the valuation:
Award Tranche Grant Date Fair Value Estimated Weighted
of Share Exercise Forfeiture Average
Price at Price rate p.a. of Remaining
Grant Date (Pence) Contractual
Life
--------------- --------------- ------------- ----------- ------------ --------------
1 January
Award 1 2011 GBP1.09 0.0714p 15% 2.5
Award 2 1 August 2011 GBP1.32 0.0714p 0% 2.5
Award 3 1 May 2012 GBP1.87 0.0714p 15% 2.5
Award 4 7 March 2014 GBP2.55 0.0714p 15% 2.5
8 September
Award 5 2014 GBP2.575 0.0714p 15% 2.7
22 September
Award 6 2014 GBP2.525 0.0714p 15% 2.5
9 December
Award 7 2014 GBP2.075 0.0714p 15% 2.6
31 December
Award 8 2014 GBP2.025 0.0714p 15% 2.5
The estimated forfeiture rate assumption is based upon
management's expectation over the number of options that will lapse
over the vesting period. The assumptions were determined when the
scheme was set up in 2011 and are reviewed annually. Management
believe the current assumptions to be reasonable based upon the
rate of lapsed options.
Each of the above awards are subject to the following vesting
criteria:
Vesting Criteria
Group Achieves Group Achieves GBP18.5m Group Achieves GBP23.5m
GBP10m EBITDA EBITDA EBITDA
---------- --------------- ------------------------ ------------------------
Award 1-4 20% Vest 40% Vest 40% Vest
Award 5 N/a 30% Vest 70% Vest
Award 6 N/a 50% Vest 50% Vest
Award 7 N/a 40% Vest 60% Vest
Award 8 N/a 50% Vest 50% Vest
During 2013 the first vesting criteria of the Group achieving
GBP10m Adjusted EBITDA was met. As a result 1,701,156 options were
exercised during 2014 at a weighted exercise price of 0.0714 pence.
The weighted average price of shares exercised was GBP2.55.
The Remuneration Committee has increased the second and third
vesting criteria to GBP18.5 million and GBP23.5 million
respectively as a result of the acquisitions made during 2014
(2013: GBP15 million and GBP20 million respectively).
The total charge recognised for the scheme during the twelve
months to 31 December 2014 was GBP4,371,000 (2013: GBP1,127,000).
The awards of the scheme are settled with ordinary shares of the
Company. Reconciliation of movement in the number of options is
provided below.
Option price Number of
(pence) options
31 December 2013 1/14th 4,775,050
Granted 1/14th 5,553,436
Vested 1/14th (1,701,156)
Forfeited 1/14th (268,450)
------------------ -------------- ------------
31 December 2014 1/14th 8,358,880
------------------ -------------- ------------
The following table summarises the Group's share options
outstanding at 31 December 2014:
Options Option price Remaining
Reporting date outstanding (pence) life (years)
31 December 2011 5,004,300 1/14th 3.7
31 December 2012 4,931,150 1/14th 4.3
31 December 2013 4,775,050 1/14th 3.3
31 December 2014 8,358,880 1/14th 2.5
------------------ ------------- ------------- --------------
7. Borrowings
31 December 31 December
2014 2013
GBP000s GBP000s
Current
Loans due within one year 1,283 -
--------------------------- ------------ ------------
Non-current
Long-term loans 15,651 5,851
--------------------------- ------------ ------------
Overdraft
The Group currently has a GBP2 million overdraft facility, which
was not drawn down upon at 31 December 2014. Interest is charged on
the overdraft at 2.25% over the Bank of England Base Rate.
Term loan and RCF
US$17m term loan and GBP20m RCF provided by The Royal Bank of
Scotland
In July 2014, the Group refinanced its debt position. A US$17
million term loan was issued by The Royal Bank of Scotland to
partially fund the acquisition of Current Analysis Inc (refer to
acquisitions detailed in note 10). This is repayable in quarterly
instalments over 4 years. The first instalment is due for repayment
in July 2015, with total repayments due in 2015 being US$2
million.
Additionally, The Royal Bank of Scotland issued a GBP20 million
revolving capital facility (RCF). As at 31 December 2014, the Group
had drawn down GBP6.4 million of this facility. The GBP2 million
overdraft discussed above and GBP1 million for potential interest
rate hedging also offset against the RCF leaving a remaining
undrawn balance of GBP10.6 million as at 31 December 2014.
Interest is charged on the term loan and drawn down RCF at a
rate of 2.25% over the London Interbank Offered Rate. Interest is
charged on the undrawn RCF at 0.9%.
These new arrangements replaced the existing GBP6 million RCF
which was arranged in October 2011 and was due for repayment in
2015.
Non-current borrowings can be reconciled as follows:
31 December 31 December
2014 2013
GBP000s GBP000s
Term loan issued by The Royal Bank of Scotland 9,619 -
RCF issued by The Royal Bank of Scotland 6,375 6,000
Capitalised fees, net of amortised amount (343) (149)
------------------------------------------------ ------------ ------------
15,651 5,851
------------------------------------------------ ------------ ------------
8. Equity
Share capital
ERC Acquisition
The Group issued 76,191 ordinary shares as part of the
consideration for ERC Group Limited and its subsidiaries (as
discussed in note 10). These shares rank pari passu with the
existing PDMG ordinary shares in issue.
Share Option Scheme
The Group issued 1,400,000 ordinary shares on 7 March 2014 and
305,080 ordinary shares on 14 March 2014 following the exercise of
options by employees pursuant to the vesting of the Company's
Capital Appreciation Plan (as discussed in note 6). These shares
rank pari passu with the existing PDMG ordinary shares in
issue.
Allotted, called up and fully paid:
31 December 2014 31 December 2013
No'000 GBP000s No'000 GBP000s
Ordinary shares at 1 January
(1/14(th)
pence) 74,487 53 - -
Sub-division of ordinary share
capital - - 74,487 53
Issue of shares: partial consideration
ERC 76 - - -
Issue of shares: other 4 - - -
Issue of shares: share based
payments scheme 1,701 1 - -
------------------------------------------ ------------ ------------- ------------- -----------------
Ordinary shares c/f 31 December
(1/14(th) pence) 76,268 54 74,487 53
Deferred shares of GBP1.00
each 100 100 100 100
------------------------------------------ ------------ ------------- ------------- -----------------
76,368 154 74,587 153
------------------------------------------ ------------ ------------- ------------- -----------------
Capital management
The Group's capital management objectives are:
-- To ensure the Group's ability to continue as a going concern
-- To fund future growth and provide an adequate return to
shareholders and, when appropriate, distribute dividends
In order to enable the directors to pay dividends in the future
when considered appropriate, at the Annual General Meeting on 24
April 2013 shareholders approved the cancellation of the parent
company's share premium account (the "Capital Reduction"). The
Capital Reduction took effect on 23 May 2013 following confirmation
by the Court. By way of undertaking to the Court, the Company has
constituted a special reserve for the protection of its creditors
as at the effective date of the Capital Reduction. In respect of
equity, the Board has decided, in order to maximise flexibility in
the near term with regards to growth opportunities, not to return
any cash by way of a dividend at this time.
The Board is committed to keeping this policy under constant
review and will evaluate alternative methods of returning cash to
shareholders when appropriate.
The Company has two classes of shares. The ordinary shares carry
no right to fixed income and each share carries the right to one
vote at general meetings of the Company.
The deferred shares do not confer upon the holders the right to
receive any dividend, distribution or other participation in the
profits of the Company. The deferred shares do not entitle the
holders to receive notice of or to attend and speak or vote at any
general meeting of the Company. On distribution of assets on
liquidation or otherwise, the surplus assets of the Company
remaining after payments of its liabilities shall be applied first
in repaying to holders of the deferred shares the nominal amounts
and any premiums paid up or credited as paid up on such shares, and
second the balance of such assets shall belong to and be
distributed among the holders of the ordinary shares in proportion
to the nominal amounts paid up on the ordinary shares held by them
respectively.
There are no specific restrictions on the size of a holding nor
on the transfer of shares, which are both governed by the general
provisions of the Articles of Association and prevailing
legislation. The Directors are not aware of any agreements between
holders of the Company's shares that may result in restrictions on
the transfer of securities or on voting rights.
No person has any special rights of control over the Company's
share capital and all its issued shares are fully paid.
With regard to the appointment and replacement of Directors, the
Company is governed by its Articles of Association, the principles
of the UK Corporate Governance Code, the Companies Act and related
legislation. The Articles themselves may be amended by special
resolution of the shareholders. The powers of Directors are
described in the Board Terms of Reference, copies of which are
available on request.
9. Discontinued operations
As the business becomes more focussed on its Business
Information offering, a number of legacy non-core business units
have been discontinued in recent years.
During 2012, the Group made the decision to close the TMN email
marketing business unit, including the TMN, EDR and TAPPS
businesses. During 2013, the Group discontinued the US and European
arms of its affiliate marketing business. The email marketing and
US / European affiliate marketing businesses formed part of the
Group's B2C Digital Marketing division.
Following a review of the performance of the Group's German
subsidiary, it was decided that it was no longer viable and its
activities ceased in June 2014. Additionally, on 1 July 2014, the
Group disposed of its 75% shareholding in Office Solutions Media
Limited ('OSM'). The subsidiary company was no longer deemed to be
a strategic fit with the remainder of the Group; therefore the
shares were sold to OSM's minority shareholder. Additionally,
towards the end of 2014, the Group decided to discontinue the PDM
(which was engaged in business to business lead generation) and
Market Research business units. The key factors affecting this
decision were a combination of continued under-performance of these
business units and lack of strategic fit with the remainder of the
group.
Pursuant to the provisions of IFRS 5 the above operations have
been classified as discontinued.
a) The results of the discontinued operations are as follows:
Year ended Year ended
31 December 31 December
2014 2013
GBP000s GBP000s
Discontinued operations
Revenue 1,338 2,670
Cost of sales (1,958) (2,580)
----------------------------------------------- ------------- -------------
Gross (loss)/ profit (620) 90
Distribution costs (19) (32)
Administrative costs (453) (768)
Other income 86 77
----------------------------------------------- ------------- -------------
Operating loss from discontinued operations (1,006) (633)
Finance costs - -
--------------------------------------------- ------------- -------------
Loss before tax from discontinued
operations (1,006) (633)
Income tax expense (622) -
--------------------------------------------- ------------- -------------
Loss for the year from discontinued
operations (1,628) (633)
----------------------------------------------- ------------- -------------
b) Loss before tax
Year ended Year ended
31 December 31 December
2014 2013
This is arrived after charging: GBP000s GBP000s
Depreciation 6 -
-------------------------------- ------------- -------------
c) Cash flows from discontinued operations
Year ended Year ended
31 December 31 December
2014 2013
GBP000s GBP000s
Cash outflows from operating activities (1,281) (114)
Cash inflows/ (outflows) from investing
activities 4 (24)
Cash outflows from financing activities (6) (8)
------------------------------------------- ------------- -------------
Total cash outflows from discontinued
operations (1,283) (146)
10. Acquisitions
Pyramid Research
On 1 January 2014 the Group acquired the business and assets of
Pyramid Research for cash consideration of US$3,250,000
(GBP2,006,173).Pyramid is a leading provider of business
information and market analysis for the ICT industry. Pyramid has a
well regarded brand name and an expanding presence in some of the
world's fastest growing markets.
The amounts recognised for each class of assets and liabilities
at the acquisition date were as follows:
Carrying Fair Value
Value Adjustments Fair Value
GBP000s GBP000s GBP000s
Intangible assets consisting of:
Software - 51 51
Brand - 503 503
Customer relationships - 420 420
Net assets acquired consisting of:
Tangible fixed assets 24 - 24
Accounts receivable 643 (184) 459
Trade and other payables (163) (64) (227)
Deferred revenue (457) - (457)
Fair value of net assets acquired 47 726 773
-------------------------------------- --------- ------------- -------------
Cash consideration 2,006
Less net assets acquired (773)
-------------------------------------- --------- ------------- -------------
Goodwill 1,233
-------------------------------------- --------- ------------- -------------
Pyramid Research has generated revenues of GBP2.4m and a
contribution loss of GBP0.4m in the year ended 31 December
2014.
The goodwill that arose on the combination can be attributed to
revenue and cost synergies expected to arise upon the integration
of Pyramid Research into Progressive Digital Media Group.
The Group incurred legal and professional costs of GBP105,000 in
relation to the acquisition, which were recognised in other
expenses (note 4).
ERC
On 28 March 2014, the Group acquired ERC Group Limited and its
subsidiaries ('ERC') for total consideration of GBP804,000. The
consideration comprised of GBP604,000 in cash consideration and
GBP200,000 in equity. The equity issued was 76,191 ordinary shares
in PDMG at a price of GBP2.625 (which rank pari passu with the
existing PDMG ordinary shares in issue). ERC is a provider of
business information and market analysis for the Consumer market.
ERC has a well regarded brand name and a dedicated client base
which will be used as a solid base for growth.
The amounts recognised for each class of assets and liabilities
at the acquisition date were as follows:
Carrying Fair Value
Value Adjustments Fair Value
GBP000s GBP000s GBP000s
Intangible assets consisting of:
Intellectual property - 485 485
Customer relationships - 101 101
Deferred tax liability upon creation
of intangible assets - (117) (117)
Net assets acquired - - -
Fair value of net assets acquired - 469 469
--------------------------------------- --------- ------------- -------------
Total consideration 804
Less net assets acquired (469)
--------------------------------------------------- ------------- -------------
Goodwill 335
--------------------------------------------------- ------------- -------------
In line with the provisions of IFRS 3, further fair value
adjustments may be required within the 12 month period from the
date of acquisition. Any fair value adjustments will result in an
adjustment to the goodwill balance reported above.
In 2013 ERC had revenues of GBP0.4m and profits before tax of
GBPnil. ERC has generated revenues of GBP0.3m and a contribution of
GBP0.1m in the period from acquisition to 31 December 2014. If the
acquisition had occurred on 1 January 2014, the Group year to date
revenue for 2014 would have been GBP63.2m and the Group profit
before tax from continuing operations would have been GBP0.3m.
The Group incurred legal and professional costs of GBP16,000 in
relation to the acquisition, which were recognised in other
expenses (note 4).
The goodwill that arose on the combination can be attributed to
revenue and cost synergies expected to arise upon the integration
of ERC into Progressive Digital Media Group.
The total cash cost of the acquisition is reconciled as
follows:
GBP000s
Cash consideration 604
Cash acquired as part of opening balance sheet (165)
Cash returned to seller representing net assets
as at completion date 104
---------------------------------------------------- ---- ----------
Total cash cost 543
---------------------------------------------------- ---- ----------
Current Analysis
On 30 July 2014, the Group acquired Current Analysis Inc and its
subsidiaries ('Current Analysis') for cash consideration of
US$19,600,000 (GBP11,529,412). Current Analysis is an established
and well regarded business which provides subscription based
business intelligence services to the ICT industry. The acquisition
supports the Group's strategy of expanding its premium subscription
based services into global markets.
The amounts recognised for each class of assets and liabilities
at the acquisition date were as follows:
Carrying Fair Value
Value Adjustments Fair Value
GBP000s GBP000s GBP000s
Intangible assets consisting of:
Customer relationships - 2,543 2,543
Brand - 1,390 1,390
Deferred tax liability upon creation
of intangible assets - (1,573) (1,573)
Net liabilities acquired consisting
of:
Tangible fixed assets 41 - 41
Intangible assets 257 - 257
Cash and cash equivalents 361 - 361
Trade receivables 1,340 - 1,340
Prepayments and other receivables 383 - 383
Trade and other payables (1,116) 461 (655)
Deferred revenue (3,701) - (3,701)
Short and long-term provisions (49) (218) (267)
----------------------------------------------- --------- ------------- -------------
Fair value of net assets acquired (2,484) 2,603 119
----------------------------------------------- --------- ------------- -------------
Total consideration 11,529
Less net assets acquired (119)
----------------------------------------------- --------- ------------- -------------
Goodwill 11,410
----------------------------------------------- --------- ------------- -------------
In line with the provisions of IFRS 3, further fair value
adjustments may be required within the 12 month period from the
date of acquisition. Any fair value adjustments will result in an
adjustment to the goodwill balance reported above.
In 2013 Current Analysis had revenues of US$13.3m and profits
before tax of US$0.2m. Current Analysis has generated revenues of
GBP3.6m and a contribution of GBP1.2m in the period from
acquisition to 31 December 2014. If the acquisition had occurred on
1 January 2014, the Group year to date revenue for 2014 would have
been GBP67.6m and the Group loss before tax from continuing
operations would have been GBP0.6m.
The Group incurred legal and professional costs of GBP286,000 in
relation to the acquisition, which were recognised in other
expenses (note 4).
The goodwill that arose on the combination can be attributed to
revenue and cost synergies expected to arise upon the integration
of Current Analysis into Progressive Digital Media Group, the
highly skilled assembled workforce and penetration into the
valuable US ICT business information sector.
As part of the acquisition of Current Analysis, US$2million of
the purchase consideration was transferred to an Escrow account to
cover unpaid historic US sales tax. A claim will be made against
the Escrow monies to extinguish the liability once the exact value
is agreed with the relevant tax authorities. The liability is
estimated to be no more than US$1.85m.
The total cash cost of the acquisition is reconciled as
follows:
GBP000s
Cash consideration 11,529
Cash acquired as part of opening balance sheet (361)
Total cash cost 11,168
--------------------------------------------------- ---- ----------
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR PKDDPKBKDNNK
Globaldata (LSE:DATA)
Graphique Historique de l'Action
De Juin 2024 à Juil 2024
Globaldata (LSE:DATA)
Graphique Historique de l'Action
De Juil 2023 à Juil 2024
