TIDMDATA
RNS Number : 5375Q
GlobalData PLC
01 March 2016
1 March 2016
GlobalData Plc
(Formerly "Progressive Digital Media Group Plc")
Final Results For The Year Ended 31 December 2015
Key highlights and achievements
-- Organic growth and acquisitions have transformed the business
-- Organic revenue growth of 14.1%
-- Deferred revenue increased by 36.3% to GBP29.3m
-- Maiden dividend of 2.5p pence per share reflecting the improved prospects for the Group
-- Completed two major acquisitions
-- Changed name to GlobalData.
Financial Highlights continuing operations (1)
-- Group revenue increased by 25.1% to GBP60.5m (2014: GBP48.3m)
-- Adjusted EBITDA (2) increased by 47.5% to GBP12.0m (2014: GBP8.1m)
-- Adjusted EBITDA margin (2) increased by 300 basis points to 19.8% (2014: 16.8%)
-- Cash generated from continuing operations increased by 731.7% to GBP10.9m (2014: GBP1.3m)
-- Reported loss before tax from continuing operations of GBP2.8m (2014: loss of GBP3.1m)
Mike Danson, Chief Executive of GlobalData Plc, commented:
"The business has changed significantly over the last year. We
now have a business with largely annualised global revenues. The
confidence in the business has resulted in a maiden dividend of 2.5
pence a share."
Note 1: Continuing operations: include the part year effect of
the Consumer acquisition and exclude the disposal of the non-core
B2B print business. The results do not included any contribution
from the recently completed acquisition of the Healthcare Business
information assets from GlobalData Ltd.
Note 2: Adjusted EBITDA: Earnings before interest, tax,
depreciation and amortisation, non-trading 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.
About GlobalData Plc
GlobalData is a premium business intelligence company, providing
subscription based data, insight and analytic services to
businesses operating in dynamic global industries.
ENQURIES
GlobalData Plc 0207 936 6400
Mike Danson, Chief Executive
Simon Pyper, Group Financial Officer
N+1 Singer 0207 496 3000
James Maxwell
James White
Hudson Sandler 0207 796 4133
Nick Lyon
CHAIRMAN'S STATEMENT
This has been a year of transition for the Group; we completed
one significant acquisition, announced another and exited from the
more traditional B2B print sector. The net effect of these
transactions is a Group transformed and one which is clearly
focused on the provision of premium business information services
to global industries, all with significant opportunities for
long-term growth.
In recognition of this transformation and to reflect our
business more fully, the Group has renamed itself GlobalData Plc
and has, as previously announced, made a number of changes to the
Board and senior management team. It is exciting that Mike Danson
has agreed to assume the role of Chief Executive of the enlarged
group and I am proud to become its Non-Executive Chairman. The
overall change in structure and the integration of the acquisitions
will result in a more focused management team.
For the forthcoming year we expect to make further progress as
we position the Group to take advantage of its strong market
positions.
Our markets
Since the Group formed we have been consistent in our strategy
of developing the Business Information side of the company. The
recent acquisitions, coupled with the disposal of the non-core B2B
print assets, are consistent with this strategy. Following these
transactions, the Group will operate in three key global business
information verticals (namely Consumer, Information Communications
Technology (ICT) and Healthcare with a combined addressable market
estimated at over US$10 billion.
Whilst distinct from one another, our verticals do share some
common characteristics: large global industry, no dominant supply
side provider and with a demand side which is large, fragmented and
with a history of spend on business information products and
services.
We now have geographical reach and operational scale with each
vertical represented, globally, by one or more of the Group's
brands; Consumer being served by Canadean, ICT by Current Analysis
and Healthcare by GlobalData.
Our business model
The Group produces and owns premium business information for
each of our markets. We provide data, insight and analysis across
multiple platforms that enable our customers to gain a competitive
advantage in their markets. We have a clear philosophy of owning
our own data and intellectual property together with powerful
analysis supporting our clients' businesses.
Our business model is designed to generate revenues off a
relatively fixed operating cost base, allowing for operational
gearing to drive increased cash generation and profit growth. The
key features are:
-- Strong asset base with scalable business model - premium intelligence and customer datasets
-- Global coverage of Consumer, ICT and Healthcare information markets
-- Focus on subscription revenues - high quality recurring
income, with high barriers to entry and pricing power
-- Investment in human capital.
Our employees
It has been a challenging year for the Group and its employees.
That so much has been achieved and that we continued to grow during
a period of such transformation is a testament to the quality,
dedication and hard work of our staff. I would like to express my
own and my fellow Board members' appreciation of the continued
commitment of our colleagues and wish them all every success for
the year ahead.
Board Changes
I am delighted that Murray Legg has agreed to join the Board of
the Company as a Non-Executive Director succeeding me as Chairman
of the Audit Committee.
Maiden dividend
Our business is one that is focused on the efficient management
of working capital and increased cash generation. The Board
therefore believes it can invest in the business, achieve growth in
profits and service a progressive dividend policy. Having regard to
the improved prospects for the Group and the cash requirements of
the business for the year ahead, the Board is pleased to announce a
proposed maiden final dividend of 2.5 pence per share. The proposed
final dividend will be paid on 3(rd) June 2016 to shareholders on
the register at the close of business on 13(th) May 2016.
Current trading and outlook
We have had a good start to the year and we remain confident for
the remainder of the year.
Bernard Cragg
Chairman
1 March 2016
CHIEF EXECUTIVE'S REVIEW
The Group delivered a good set of financial results for the
year, increasing revenues, margins and cash generation. That we
performed so well during a period of such transformation is, I
believe, a testament to the robustness of our business model,
confirmation that our strategy is sound and more importantly, a
reflection of the quality and commitment of our staff.
The business has changed significantly over the last year. We
now have a business with largely annualised global revenues. The
confidence in the business has resulted in a maiden dividend of 2.5
pence a share.
The Group's performance this year - continuing operations
Continuing operations include the part year effect of the
Consumer acquisition and exclude the disposal of the non-core B2B
print business. Additionally, the results do not include any
contribution from the recently completed acquisition of the
Healthcare business information assets from GlobalData Ltd.
1. Revenue
On a continuing basis, revenues increased by 25.1% to GBP60.5m
(2014: GBP48.3m) which reflects both good organic growth (14.1%)
and the part year benefit of the Consumer acquisition. The acquired
Consumer business is, I am pleased to report, performing well and
in line with management expectations.
With the acquisition of the Healthcare business our business
information revenues will, broadly speaking, be equally balanced
across the three industry verticals.
2. Deferred Revenue
Deferred revenue increased by 36.3% to GBP29.3m (2014:
GBP21.5m). On a pro-forma basis, deferred revenue, including the
acquired deferred revenue for the Healthcare business, was GBP36.0m
at 31 December 2015, providing significant visibility on 2016
expected revenues.
3. Adjusted EBITDA
Adjusted EBITDA increased by 47.5% to GBP12.0m (2014: GBP8.1m)
with the Group's margin improving by 300 basis points to 19.8%
(2014: 16.8%). The EBITDA margin growth reflects the benefit of
operational gearing.
4. Cash Generation
Cash generation improved significantly during the year, with
cash generated from continuing operations increasing by GBP9.6m to
GBP10.9m (2014: GBP1.3m). Cash conversion (cash generated from
operations as a percentage of Adjusted EBITDA) increased to 91.2%
from 16.2% in the prior year.
Development of the Business
Our principal objective is to become one of the world's leading
providers of premium, subscription based business information
products and services to the verticals we serve.
To that end, we have four core strategic priorities:
-- To develop world class products and services
-- To continue to develop our sales capabilities
-- To improve operational effectiveness
-- To provide best in class customer service
Developing world class products and services
Our content is data driven and analyst led and provides our
clients with strategic and tactical insights for the markets that
they operate in. Our content is robust, relevant and unique; the
majority of which can be accessed via our online delivery platforms
that give our clients real time access to critical business
information and an increasing array of work flow tools.
Develop our sales capabilities
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The business information market is dominated by North America,
which accounts for 50% of global spend, followed by Europe and Asia
Pacific. Our goal is to create more geographical balance in our
business reflecting market size. Consequently, the Group will look
to increase its management and sales operations in the important
North American and Asia Pacific markets.
Improve operational effectiveness
The Group has a number of common systems and processes from
sales management to content production and client delivery. The
Group constantly seeks to 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.
Providing best in class customer service
We believe that outstanding customer service is a critical
component in delivering customer satisfaction and improved customer
retention. Our aim is to deliver best in class customer service at
every point of interaction with our clients. If successful we
should expect to see upper quartile renewal rates by volume for our
subscription products.
We are a transformed business focused solely on the provision of
business information to three global verticals, all of which
present opportunities for long-term profitable growth. We expect
that 2016 will be a year of progress and opportunity for the
Group.
Mike Danson
Chief Executive
1 March 2016
FINANCIAL REVIEW
The recent acquisitions and exit from the legacy B2B print
business has improved the financial profile of the business. I am
pleased that on a continuing basis, for the twelve months ended 31
December 2015, revenue increased by 25.1% to GBP60.5m, Adjusted
EBITDA increased by 47.5% to GBP12.0m and cash generated from
continuing operations increased to GBP10.9m being some 91.2% of
Adjusted EBITDA.
Financial highlights
Positive movement across all key trading metrics.
1. Group revenue increased by 25.1% to GBP60.5m (2014: GBP48.3m)
2. Organic revenue increased by 14.1%
3. Deferred Revenue increased by 36.3% to GBP29.3m (2014: GBP21.5m)
4. Adjusted EBITDA(1) increased by 47.5% to GBP12.0m (2014: GBP8.1m)
5. Adjusted EBITDA margin(1) increased by 300 basis points to 19.8% (2014: 16.8%)
6. Reported EBITDA(2) increased to GBP3.2m (2014: GBP0.4m)
7. Reported loss before tax from continuing operations of
GBP2.8m (2014: loss of GBP3.1m) inclusive of GBP4.3m restructuring
costs and GBP2.1m share based payments charge
8. Cash generated from continuing operations increased by 731.7% to GBP10.9m (2014: GBP1.3m)
9. Net debt (3) of GBP25.5m (2014: GBP8.7m)
2015 2014 Movement
Continuing operations GBP000s GBP000s
Revenue 60,466 48,344 25.1%
Loss before tax (2,803) (3,100)
Depreciation 676 547
Amortisation 4,392 2,425
Finance costs 886 484
------------------------------------------------ -------- -------- -----------
EBITDA(2) 3,151 356 785.1%
Restructuring costs 4,258 2,237
Property related provisions 61 (221)
Revaluation of short and long-term derivatives 217 15
Share based payments charge 2,066 4,371
Exceptional property costs 6 13
Non-trading foreign exchange loss 773 787
M&A costs 1,464 431
Deal costs 6 146
Adjusted EBITDA(1) 12,002 8,135 47.5%
------------------------------------------------ -------- -------- -----------
Adjusted EBITDA margin(1) 19.8% 16.8%
------------------------------------------------ -------- -------- -----------
Note 1: Adjusted EBITDA: Earnings before interest, tax,
depreciation and amortisation, non-trading 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 GBP2.1
million for share based payments (2014: GBP4.4 million).
Note 3: Net debt: Short and long-term borrowings less cash and
cash equivalents.
Earnings per share
Basic loss per share from continuing operations was (4.08) pence
per share (2014: loss of (4.29) pence per share). Fully diluted
loss per share from continuing operations was also (4.08) pence per
share (2014: loss of (4.29) pence per share) due to the share
options in issue being anti-dilutive.
FINANCIAL REVIEW
Cash flow
The Group generated GBP12.0 million of Adjusted EBITDA in 2015,
which excludes GBP0.2 million paid in relation to onerous leases.
Working capital movements reduced the cash generated from
continuing operations to an inflow of GBP10.9 million.
Trade and other receivables were lower than the previous year at
GBP32.1 million (2014: GBP33.0 million), reflecting the transfer of
assets held for sale in 2015, offset by strong billings in the last
quarter of the year as well as the effect of the Consumer
acquisition from Informa Plc.
A further draw down on the Banking facilities negotiated with
The Royal Bank of Scotland in 2014 resulted in a cash inflow of
GBP10.0 million. In addition to this, a new term loan of GBP10.0
million was taken from The Royal Bank of Scotland, meaning a total
inflow from financing activities of GBP20.0 million. During the
year, the Group repaid an aggregate of GBP1.9m of its term loans to
The Royal Bank of Scotland in accordance with the repayment
terms.
Capital expenditure (excluding balances in relation to
acquisitions) was GBP1.5 million in 2015 (GBP2.3 million in 2014).
This included GBP1.1 million on software (GBP1.1 million in
2014).
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.
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 Accounts on a going
concern basis.
Simon Pyper
Group Financial Officer
1 March 2015
Consolidated Income Statement
Notes Year ended Year ended
31 December 31 December
2015 2014
GBP000s GBP000s
Continuing operations
Revenue 3 60,466 48,344
Cost of sales (36,745) (29,730)
--------------------------------------- ------ ------------- -------------
Gross profit 23,721 18,614
Distribution costs (804) (792)
Administrative costs (12,391) (11,132)
Other expenses 4 (12,443) (9,306)
--------------------------------------- ------ ------------- -------------
Operating loss (1,917) (2,616)
Analysed as:
Adjusted EBITDA(1) 12,002 8,135
Items associated with acquisitions
and restructure of the Group 4 (5,795) (2,606)
Other adjusting items 4 (3,056) (5,173)
--------------------------------------- ------ ------------- -------------
EBITDA(2) 3,151 356
Amortisation (4,392) (2,425)
Depreciation (676) (547)
--------------------------------------- ------ ------------- -------------
Operating loss (1,917) (2,616)
--------------------------------------- ------ ------------- -------------
Finance costs (886) (484)
Loss before tax from continuing
operations (2,803) (3,100)
Income tax expense (306) (157)
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--------------------------------------- ------ ------------- -------------
Loss for the year from continuing
operations (3,109) (3,257)
(Loss)/ profit for the year
from discontinued operations 11 (7,992) 1,036
Loss for the year (11,101) (2,221)
--------------------------------------- ------ ------------- -------------
Attributable to:
Equity holders of the parent (11,101) (2,106)
Non-controlling interest - (115)
--------------------------------------- ------ ------------- -------------
Loss per share attributable
to equity holders from continuing
operations: 5
Basic loss per share (pence) (4.08) (4.29)
Diluted loss per share (pence) (4.08) (4.29)
(Loss)/ earnings per share
attributable to equity holders
from discontinued operations:
Basic (loss)/ earnings per
share (pence) (10.48) 1.52
Diluted (loss)/ earnings per
share (pence) (10.48) 1.37
Total basic loss per share
(pence) (14.56) (2.77)
Total diluted loss per share
(pence) (14.56) (2.77)
--------------------------------------- ------ ------------- -------------
(1) We define Adjusted EBITDA as EBITDA adjusted for costs
associated with acquisition, integration, restructure of the Group,
share based payments, impairment, non-trading 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 Group 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
2015 2014
GBP000s GBP000s
Loss for the year (11,101) (2,221)
Other comprehensive income
Items that will be classified subsequently
to profit or loss:
Translation of foreign entities (55) (166)
Other comprehensive loss, net of
tax (55) (166)
-------------------------------------------- ------------- -------------
Total comprehensive loss for the
year (11,156) (2,387)
-------------------------------------------- ------------- -------------
Attributable to:
Equity holders of the parent (11,156) (2,272)
Non-controlling interest - (115)
-------------------------------------------- ------------- -------------
Consolidated Statement of Financial Position
Notes 31 December 2015 31 December 2014
GBP000s GBP000s
Non-current assets
Property, plant and equipment 1,297 1,510
Intangible assets 62,540 42,403
Deferred tax assets 2,042 2,226
------------------------------------------------------------ -------- ------------------- -------------------
65,879 46,139
------------------------------------------------------------ -------- ------------------- -------------------
Current assets
Inventories 77 150
Current tax receivable 432 -
Trade and other receivables 32,089 33,049
Short-term derivative assets - 106
Cash and cash equivalents 10,117 8,261
------------------------------------------------------------ -------- ------------------- -------------------
42,715 41,566
------------------------------------------------------------ -------- ------------------- -------------------
Non-current assets and current assets classified as held
for sale 11 6,425 -
------------------------------------------------------------ -------- ------------------- -------------------
Total assets 115,019 87,705
------------------------------------------------------------ -------- ------------------- -------------------
Current liabilities
Trade and other payables (46,061) (32,567)
Short-term borrowings 7 (5,214) (1,283)
Current tax payable - (1,240)
Short-term derivative liabilities (201) (89)
Short-term provisions (1,649) (368)
------------------------------------------------------------ -------- ------------------- -------------------
(53,125) (35,547)
------------------------------------------------------------ -------- ------------------- -------------------
Non-current liabilities
Long-term provisions (954) (84)
Deferred tax liabilities (3,218) (1,769)
Long-term derivative liabilities (24) (26)
Long-term borrowings 7 (30,359) (15,651)
------------------------------------------------------------ -------- ------------------- -------------------
(34,555) (17,530)
------------------------------------------------------------ -------- ------------------- -------------------
Liabilities directly associated with non-current assets and
current assets classified as held
for sale 11 (2,128) -
------------------------------------------------------------ -------- ------------------- -------------------
Total liabilities (89,808) (53,077)
------------------------------------------------------------ -------- ------------------- -------------------
Net assets 25,211 34,628
------------------------------------------------------------ -------- ------------------- -------------------
Equity
Share capital 8 154 154
Share premium account 200 200
Other reserve (37,128) (37,128)
Special reserve 48,422 48,422
Foreign currency translation reserve (181) (126)
Retained profit 13,744 23,106
------------------------------------------------------------ -------- ------------------- -------------------
Total equity 25,211 34,628
------------------------------------------------------------ -------- ------------------- -------------------
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Consolidated Statement of Changes in Equity
Share Share Other Foreign Retained Equity Non-controlling Total
capital premium reserve currency profit attributable interest equity
account translation to
reserve equity
Special holders
reserve of
the
parent
GBP000s GBP000s GBP000s GBP000s GBP000s GBP000s GBP000s GBP000s GBP000s
----------------------- -------- --------- --------- ------------ --------- ------------- ---------------- ---------
Balance at 1
January
2014 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
Loss for the year - - - - - (11,101) (11,101) - (11,101)
Other
comprehensive
income:
Translation of
foreign entities - - - - (55) - (55) - (55)
------------------ ---- -------- --------- --------- ------------ --------- ------------- ---------------- ---------
Total
comprehensive
loss for the
year - - - - (55) (11,101) (11,156) - (11,156)
------------------ ---- -------- --------- --------- ------------ --------- ------------- ---------------- ---------
Transactions with
owners:
Share based
payments
charge - - - - - 2,066 2,066 - 2,066
Excess
deferred
tax on share
based
payments - - - - - (327) (327) - (327)
------------------ ---- -------- --------- --------- ------------ --------- ------------- ---------------- ---------
Balance at 31
December 2015 154 200 (37,128) 48,422 (181) 13,744 25,211 - 25,211
------------------ ---- -------- --------- --------- ------------ --------- ------------- ---------------- ---------
Consolidated Statement of Cash Flows
Year ended Year ended
31 December 31 December
Continuing operations 2015 2014
Cash flows from operating activities GBP000s GBP000s
Loss for the year from continuing
operations (3,109) (3,257)
Adjustments for:
Depreciation 676 547
Amortisation 4,392 2,425
Finance costs 886 484
Taxation recognised in profit
or loss 306 157
Profit on disposal of subsidiary - (106)
Loss on disposal of property,
plant and equipment - 8
Non-trading foreign exchange
loss 774 902
Share based payments charge 2,066 4,371
Increase in trade and other receivables (6,504) (4,465)
Decrease in inventories 73 5
Increase in trade payables 9,018 529
Revaluation of short and long-term
derivatives 216 15
Movement in provisions 2,151 (299)
----------------------------------------- ------------- -------------
Cash generated from continuing
operations 10,945 1,316
Interest paid (continuing operations) (775) (220)
Income taxes paid (continuing
operations) (2,182) (1,364)
----------------------------------------- ------------- -------------
Net cash from/ (used in) operating
activities (continuing operations) 7,988 (268)
Net (decrease)/ increase in cash
and cash equivalents from discontinued
operations (1,624) 518
----------------------------------------- ------------- -------------
Total cash flows from operating
activities 6,364 250
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)
Acquisition of Verdict Research (20,679) -
Limited
Proceeds from disposal of subsidiary - 58
Purchase of property, plant and
equipment (468) (1,212)
Purchase of intangible assets (1,066) (1,128)
----------------------------------------- ------------- -------------
Net cash used in investing activities
(continuing operations) (22,213) (15,999)
Net increase in cash and cash
equivalents from discontinued
operations - 4
----------------------------------------- ------------- -------------
Total cash flows from investing
activities (22,213) (15,995)
Cash flows from financing activities
(continuing operations)
Repayment of short-term borrowings (1,920) -
Proceeds from long-term borrowings 20,000 10,000
----------------------------------------- ------------- -------------
Net cash from financing activities
(continuing operations) 18,080 10,000
Net decrease in cash and cash
equivalents from discontinued
operations - (6)
----------------------------------------- ------------- -------------
Total cash flows from financing
activities 18,080 9,994
----------------------------------------- ------------- -------------
Net increase/ (decrease) in cash
and cash equivalents 2,231 (5,751)
Cash and cash equivalents at
beginning of year 8,261 14,178
Effects of currency translation
on cash and cash equivalents (375) (166)
----------------------------------------- ------------- -------------
Cash and cash equivalents at
end of year 10,117 8,261
----------------------------------------- ------------- -------------
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).
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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 2015 and should be read in conjunction
with the Annual Report and Accounts for the year ended 31 December
2014 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 2015. The
auditors have reported on the Group's statutory accounts for the
year ended 31 December 2015 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 2015 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 software, brands,
intellectual property rights and customer relationships. The
intangibles were valued based on either the net present value of
the future cash flows associated with the intangible, or on the
cost to recreate an intangible. Assumptions are made on the useful
life of an intangible and if shortened, would increase the
amortisation charge recognised in the income statement.
There are a number of assumptions in estimating the present
value of future cash flows including management's expectation of
future revenue, renewal rates for subscription customers, costs,
timing and quantum of future capital expenditure, long-term growth
rates and discount rates.
Provision 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 based payments reserve within equity.
Additional disclosures on the calculation of share based payments
are provided in note 6.
Carrying value of goodwill and other intangibles
The carrying value of goodwill and other intangibles is assessed
at each reporting date 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. Based on cash flow projections the Group
considers the existing financing facilities to be adequate to meet
short-term commitments.
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. This is
repayable in quarterly instalments over 4 years. The first
instalment was made in July 2015, with total repayments due in 2016
being US$4 million.
The Group took out an additional term loan of GBP10 million in
August 2015, which is repayable in quarterly instalments over 4
years. The first instalment was made in October 2015, with total
repayments due in 2016 being GBP2.5 million.
Additionally, the Group drew a further GBP10 million in August
2015 from its revolving capital facility (RCF) with The Royal Bank
of Scotland. As at 31 December 2015, the Group had a total draw
down of GBP16.4 million against a total facility of GBP17
million.
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%.
The finance facilities were issued with debt covenants which are
measured on a quarterly basis. There were no breaches of these
covenants during the year and as at 31 December 2015. Management
have reviewed forecasted cash flows and there is no indication that
there will be any breach in the next 12 months.
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 2015.
3. Segmental analysis
The principal activity of GlobalData Plc (formerly Progressive
Digital Media Group Plc) and its subsidiaries ('the Group') is to
enable organisations in the Consumer, ICT and Healthcare markets to
gain competitive advantage by providing unique, high quality
business information and services across multiple platforms.
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.
A reconciliation of Adjusted EBITDA to loss before tax from
continuing operations is set out below:
Year ended Year ended
31 December 31 December
2015 2014
GBP000s GBP000s
Business Information 60,466 48,344
Total Revenue 60,466 48,344
Adjusted EBITDA 12,002 8,135
Other expenses (see note 4) (12,443) (9,306)
Depreciation (676) (547)
Amortisation (excluding amortisation
of acquired intangible assets) (800) (898)
Finance costs (886) (484)
Loss before tax from continuing
operations (2,803) (3,100)
-------------------------------------- ------------- -------------
Geographical analysis
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From continuing operations
Year ended 31 December 2015 UK Europe North America Rest of World Total
GBP000s GBP000s GBP000s GBP000s GBP000s
Revenue from external customers 17,001 17,054 17,457 8,954 60,466
--------------------------------- -------- -------- -------------- -------------- --------
Year ended 31 December 2014 UK Europe North America Rest of World Total
GBP000s GBP000s GBP000s GBP000s GBP000s
Revenue from external customers 11,633 16,902 11,684 8,125 48,344
--------------------------------- -------- -------- -------------- -------------- --------
4. Other expenses
Year ended Year ended
31 December 31 December
2015 2014
GBP000s GBP000s
Restructuring costs 4,258 2,237
Property related provisions 61 (221)
Exceptional property costs 6 13
Deal costs 6 146
M&A costs 1,464 431
Items associated with acquisitions
and restructure of the Group 5,795 2,606
Share based payments charge 2,066 4,371
Revaluation of short and long-term
derivatives 216 15
Unrealised foreign exchange loss 774 787
Amortisation of acquired intangibles 3,592 1,527
Total other expenses 12,443 9,306
-------------------------------------- ------------- -------------
-- Restructuring costs relates to redundancies and other
restructuring, largely in relation to the integration of
acquisitions made during the year. Included in this number is a
loss of GBP2,316,000 relating to an onerous contract acquired as
part of the acquisition of Verdict Research Limited. Redundancies
were announced prior to 31 December 2015.
-- 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.
-- 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 scheme (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.
-- Non-trading foreign exchange losses relate to non-cash
exchange losses made on non-trading items such as loans denominated
in foreign currencies.
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
2015 2014
Continuing operations
Basic
Loss for the year attributable
to ordinary shareholders of the
parent company (GBP000s) (3,109) (3,257)
Weighted average number of shares
(000s) 76,268 75,941
Basic loss per share (pence) (4.08) (4.29)
Diluted
Loss for the year attributable
to ordinary shareholders of the
parent company (GBP000s) (3,109) (3,257)
Weighted average number of shares*
(000s) 76,268 75,941
Diluted loss per share (pence) (4.08) (4.29)
Discontinued operations
Basic
(Loss)/ profit for the year attributable
to ordinary shareholders from
discontinued operations (GBP000s) (7,992) 1,036
Less minority interest (GBP000s) - (115)
(Loss)/ profit for the year attributable
to ordinary shareholders of the
parent company (GBP000s) (7,992) 1,151
Weighted average number of shares
(000s) 76,268 75,941
Basic (loss)/ earnings per share
(pence) (10.48) 1.52
Diluted
(Loss)/ profit for the year attributable
to ordinary shareholders of the
parent company (GBP000s) (7,992) 1,151
Weighted average number of shares*
(000s) 76,268 84,300
Diluted (loss)/ earnings per share
(pence) (10.48) 1.37
------------------------------------------ ------------- -------------
Total
Basic
Loss for the year attributable
to ordinary shareholders of the
parent company (GBP000s) (11,101) (2,106)
Weighted average number of shares
(000s) 76,268 75,941
Basic loss per share (pence) (14.56) (2.77)
Diluted
Loss for the year attributable
to ordinary shareholders of the
parent company (GBP000s) (11,101) (2,106)
Weighted average number of shares*
(000s) 76,268 75,941
Diluted loss per share (pence) (14.56) (2.77)
------------------------------------------ ------------- -------------
* The share options in issue are anti-dilutive in respect of the
diluted loss per share calculation in 2015 and 2014; therefore the
options have not been included in the calculation.
Reconciliation of basic weighted average number of shares to the
diluted weighted average number of shares:
31 December 31 December
2015 2014
No'000s No'000s
Basic weighted average number
of shares 76,268 75,941
Share options in issue at end
of year 7,558 8,359
--------------------------------- ------------ ------------
Diluted weighted average number
of shares 83,826 84,300
--------------------------------- ------------ ------------
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 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% 2.6
21 April
Award 9 2015 GBP2.05 0.0714p 15% 3.0
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The estimated forfeiture rate assumption is based upon
management's expectation of 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 Group Achieves
GBP10m EBITDA GBP18.5m EBITDA GBP23.5m EBITDA
------ --------------- ----------------- -----------------
Award 20% Vest 40% Vest 40% Vest
1-4
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
Award
9 N/a 40% Vest 60% Vest
The total charge recognised for the scheme during the twelve
months to 31 December 2015 was GBP2,066,000 (2014: GBP4,371,000).
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
(pence) of
options
31 December 2014 1/14th 8,358,880
Granted 1/14th 1,079,960
Forfeited 1/14th (1,881,000)
------------------ -------------- ------------
31 December 2015 1/14th 7,557,840
------------------ -------------- ------------
The following table summarises the Group's share options
outstanding at 31 December 2015:
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
31 December 2015 7,557,840 1/14th 2.5
------------------ ------------- ------------- --------------
7. Borrowings
31 December 31 December
2015 2014
GBP000s GBP000s
Current
Loans due within one year 5,214 1,283
--------------------------- ------------ ------------
Non-current
Long-term loans 30,359 15,651
--------------------------- ------------ ------------
Term loan and RCF
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. This is
repayable in quarterly instalments over 4 years. The first
instalment was made in July 2015, with total repayments due in 2016
being US$4 million.
The Group took out an additional term loan of GBP10 million in
August 2015, which is repayable in quarterly instalments over 4
years. The first instalment was made in October 2015, with total
repayments due in 2016 being GBP2.5 million.
Additionally, The Group drew a further GBP10 million in August
2015 from its revolving capital facility (RCF) with The Royal Bank
of Scotland. As at 31 December 2015, the Group had total draw down
of GBP16.4 million against a total facility of GBP17 million.
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%.
Borrowings can be reconciled as follows:
31 December 31 December
2015 2014
GBP000s GBP000s
Term loans issued by The Royal Bank
of Scotland 19,552 10,902
RCF issued by The Royal Bank of
Scotland 16,408 6,375
Capitalised fees, net of amortised
amount (387) (343)
------------------------------------- ------------ ------------
35,573 16,934
------------------------------------- ------------ ------------
8. Equity
Share capital
Allotted, called up and fully paid:
31 December 31 December
2015 2014
No'000 GBP000s No'000 GBP000s
Ordinary shares at 1
January (1/14(th) pence) 76,268 54 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 76,268 54
Deferred shares of GBP1.00
each 100 100 100 100
--------------------------- --------- --------- -------- --------
76,368 154 76,368 154
--------------------------- --------- --------- -------- --------
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. These shares rank pari passu with the
existing GD ordinary shares in issue.
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
The capital structure of the Group consists of net debt, which
includes borrowings (note 7) and cash and cash equivalents, and
equity.
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 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.
Dividends
The Group is one that is focused on the efficient management of
working capital and increased cash generation. The Board therefore
believes it can invest in the business, achieve growth in profits
and service a progressive dividend policy. Having regard to the
improved prospects for the Group and the cash requirements of the
business for the year ahead, the Board has announced a proposed
maiden final dividend of 2.5 pence per share. The proposed final
dividend will be paid on 3rd June 2016 to shareholders on the
register at the close of business on 13th May 2016.
Other reserves
The foreign currency translation reserve contains the
translation differences that arise upon translating the results of
subsidiaries with a functional currency other than Sterling. Such
exchange differences are recognised in the income statement in the
period in which a foreign operation is disposed of.
Special reserve
The special reserve was created upon the capital reduction,
which occurred during 2013.
In order to facilitate the proposed dividend, the special
reserve, constituted by an undertaking to the Court given in
connection with the reduction of the Company's share premium
account undertaken in May 2013 (the "Special Reserve"), has been
released in accordance with its terms pursuant to a resolution of
the Board dated 23 February 2016 (all relevant creditors having
been discharged or otherwise consented to the reduction). Unaudited
interim accounts for the two month period to 29 February 2016
prepared for the purposes of section 836 Companies Act 2006 and
showing, inter alia, the effect of the release of the Special
Reserve will be filed at Companies House prior to the despatch of
the notice of AGM to be held on 17 May 2016.
9. Acquisitions
Verdict Research Limited
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On 1 September 2015 the Group acquired the Datamonitor
Financial, Datamonitor Consumer, MarketLine and Verdict businesses
from Informa Plc for cash consideration of GBP25,087,290. The
acquisition was effected by Informa Plc transferring the above
named businesses to Verdict Research Limited, the entire share
capital of which was acquired by GlobalData Plc (formerly
Progressive Digital Media Group Plc). During 2015, Verdict Research
Limited changed its name to Progressive Digital Media Limited.
The amounts recognised for each class of assets and liabilities
at the acquisition date were as follows:
Carrying Fair
Value Value Fair
Adjustments Value
GBP000s GBP000s GBP000s
Intangible assets consisting
of:
Brand - 2,924 2,924
Customer relationships - 1,656 1,656
Intellectual Property and
Content - 7,337 7,337
Net assets acquired consisting
of:
Tangible fixed assets 17 (17) -
Cash 4,408 - 4,408
Trade receivables 1,106 (270) 836
Trade and other payables - (193) (193)
Deferred revenue (5,438) (611) (6,049)
Deferred tax 2 (2,385) (2,383)
Fair value of net assets
acquired 95 8,441 8,536
--------------------------------------- --------- ------------- --------
Cash consideration 25,087
Less net assets acquired (8,536)
--------------------------------------- --------- ------------- --------
Goodwill 16,551
--------------------------------------- --------- ------------- --------
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 2014 the acquired businesses had revenues of GBP17.8 million
and profits before tax of GBP3.7 million. The businesses have
generated revenues of GBP5.3 million and Adjusted EBITDA of GBP1.9
million in the period from acquisition to 31 December 2015. If the
acquisition had occurred on 1 January 2015, the Group year to date
revenue for 2015 would have been GBP71.2 million and the Group
profit before tax from continuing operations would have been GBP0.7
million.
The goodwill that arose on the combination can be attributed to
revenue and cost synergies expected to arise upon the integration
of the acquired businesses into the Group.
The Group incurred legal and professional costs of GBP331,000 in
relation to the acquisition, which were recognised in other
expenses (note 4).
The total cash cost of the acquisition is reconciled as
follows:
Cash consideration 25,087
Cash acquired as part of
opening balance sheet (4,408)
----------------------------- --------
Total cash cost 20,679
----------------------------- --------
10. Post Balance Sheet Events
In January 2016 the Group completed the acquisition of
Healthcare business information provider GlobalData Holding
Limited, a private company owned by Mike Danson and Wayne Lloyd
(and his connected parties) for a total consideration satisfied by
the issue 26,078,431 Ordinary Shares.
In accordance with IFRS3.B66, management has not been able to
estimate the fair value of goodwill and intangible assets acquired
as the acquisition occurred in close proximity of the year end. No
revenues or profits are included in the Group's results for the
year ended 31 December 2015. In 2015 the acquired Healthcare
business had revenues of GBP19.1 million and profits before tax of
GBP1.4 million.
In addition, the Group also completed the disposal of its
non-core B2B print assets to Research Views Limited also controlled
by Mike Danson and Wayne Lloyd (and his connected parties). The
disposal was for consideration of GBP1, together with a guaranteed
loan agreement from the related party acquirers.
As a result of the above transactions, the Group changed its
name to GlobalData Plc which better reflects the business and its
operations.
On 1 March 2016, the Group announced its maiden dividend.
Further details can be found in note 8.
11. Assets held for sale and discontinued operations
As the business becomes more focused on its business information
offering, a number of legacy non-core business units have been
discontinued in recent years.
On 23(rd) December 2015, the Group announced that it was in
advanced negotiations to sell some of its non-core B2B print
businesses to a related party, as described in note 10. The Board
felt that the assets no longer fitted with the Group's strategy of
being a solely business information focused business. The
completion of the disposal was confirmed on 19 January 2016.
The B2B print assets subject to the disposal currently provide
marketing, advertising and online solutions to a wide number of
clients operating in a number of the Group's non-core industry
verticals, including Automotive, Oil & Gas and Hospitality. The
disposal represents an exit from non-core businesses, which operate
in markets that are contracting and are inconsistent with the
remainder of the Group.
Pursuant to the provisions of IFRS 5, the business has been
classified as held for sale as at 31 December 2015 and its
operations have been separated out as discontinued.
Carrying Fair
Value Value Fair
Adjustments Value
GBP000s GBP000s GBP000s
Non-current assets consisting
of:
Goodwill 4,335 (4,335) -
Intangible assets 497 (497) -
Current assets consisting
of:
Trade receivables 7,553 (1,393) 6,160
Other receivables 265 - 265
Total Non-current and Current
Assets 12,650 (6,225) 6,425
--------------------------------- --------- ------------- --------
Current liabilities consisting
of:
Trade payables (270) - (270)
Deferred income (1,077) - (1,077)
Accruals (781) - (781)
Total Current Liabilities (2,128) - (2,128)
--------------------------------- --------- ------------- --------
Net Assets held-for-sale 10,522 (6,225) 4,297
--------------------------------- --------- ------------- --------
A fair value review was conducted by management prior to the
assets being classified as held-for-sale. As a result, an
impairment of GBP6.2 million was recorded in the income
statement.
In addition to the disposal of the non-core B2B print business,
included in the discontinued operations are those activities which
ceased during 2014, including the Group's German subsidiary, the
disposal of its 75% shareholding in Office Solutions Media Limited
as well as a lead generation and market research business.
a) The results of the discontinued operations are as follows;
Year ended Year ended
31 December 31 December
2015 2014
GBP000s GBP000s
Discontinued operations
Revenue 10,145 16,155
Cost of sales (10,013) (11,522)
--------------------------------- ------------- -------------
Gross profit 132 4,633
Distribution costs - (19)
Administrative costs (8,925) (2,312)
Other income - 86
--------------------------------- ------------- -------------
(Loss)/ profit before tax
from discontinued operations (8,793) 2,388
Income tax credit/ (expense) 801 (1,352)
--------------------------------- ------------- -------------
(Loss)/ profit for the year
from discontinued operations (7,992) 1,036
--------------------------------- ------------- -------------
b) (Loss)/ profit before tax
Year ended Year ended
31 December 31 December
2015 2014
This is arrived at after GBP000s GBP000s
charging:
Depreciation - 6
Amortisation 409 -
Impairment 6,225 -
---------------------------- ------------ -------------
c) Cash flows from discontinued operations
Year ended Year ended
31 December 31 December
2015 2014
GBP000s GBP000s
Cash (outflows)/ inflows from
operating activities (1,624) 518
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