REG - Ebiquity PLC - Final Results <Origin Href="QuoteRef">EBQ.L</Origin> - Part 3
28/07/2015 07:02
- Part 3: For the preceding part double click ID:nRSb2337Ub
296
At 30 April 2015 (1,136) (1,120) (11,016) (13,272)
Net book value
At 30 April 2015 1,861 1,074 12,243 15,178
At 30 April 2014 1,093 674 12,659 14,426
At 1 May 2013 672 517 11,970 13,159
Amortisation is charged within administrative expenses so as to write off the
cost of the intangible assets over their estimated useful lives. The
amortisation of purchased intangible assets is included as a highlighted
administrative expense.
Purchased intangible assets consist principally of customer relationships with
a typical useful life of 10 years.
The Group holds assets under finance leases within computer software, with
cost of £nil (2014: £624,000) and accumulated depreciation of £nil (2014:
£213,000).
8. Financial liabilities
30 April 2015 30 April 2014
£'000 £'000
Current
Bank overdraft 1,411 -
Bank borrowings 2,411 2,943
Finance lease liabilities 4 197
Derivative financial instrument - interest rate swaps - 52
Contingent deferred consideration 4,935 4,555
8,761 7,747
Non-current
Bank borrowings 31,880 26,235
Finance lease liabilities 13 17
Derivative financial instrument - interest rate swaps - -
Contingent deferred consideration 4,064 4,108
35,957 30,360
Total financial liabilities 44,718 38,107
Bank overdrafts£'000 Bank borrowings£'000 Finance lease liabilities£'000 Interest rate swaps£'000 Contingent deferred consideration£'000 Total£'000
At 1 May 2013 - 22,417 283 145 5,657 28,502
Recognised on acquisition - - - - 7,085 7,085
Additions - - 133 - - 133
Utilised - - (202) - (5,401) (5,603)
Charged to the Income Statement - 75 - - 1,603 1,678
Charged to reserves - - - (93) - (93)
Borrowings - 10,766 - - - 10,766
Repayments - (3,937) - - - (3,937)
Foreign exchange released to the Income Statement - (143) - - (105) (248)
Foreign exchange released to reserves - - - - (176) (176)
At 30 April 2014 - 29,178 214 52 8,663 38,107
Recognised on acquisition - - - - 4,773 4,773
Additions 1,411 (360) - - - 1,051
Utilised - - (197) - (5,156) (5,353)
Charged to the Income Statement - 219 - - 279 498
Charged to reserves - - - (52) - (52)
Borrowings - 36,703 - - - 36,703
Repayments - (31,107) - - - (31,107)
Foreign exchange released to the Income Statement - (342) - - 269 (73)
Foreign exchange released to reserves - - - - 171 171
At 30 April 2015 1,411 34,291 17 - 8,999 44,718
A currency analysis for the bank borrowings is shown below:
30 April 2015£'000 30 April 2014£'000
Pounds Sterling 31,440 26,052
US Dollar - 1,068
Euros 2,851 2,058
Total bank borrowings 34,291 29,178
On 2 July 2014, the Group refinanced its banking facilities with Barclays and
Royal Bank of Scotland ('RBS') and on 7 July 2014 drew down on these new
facilities. The new committed facility, totalling £40,000,000, comprises a
term loan of £10,000,000 (of which all was drawn on refinance and of which
£8,125,000 remains outstanding at 30 April 2015 (2014: £9,798,000 of the old
facility)) and a revolving credit facility ("RCF") of £30.0m (of which
£20,757,000 was drawn on refinance and of which £26,451,000 remains
outstanding at 30 April 2015 (2014: £13,959,000 of the old facility)). Both
the term loan and the RCF have a maturity date of 2 July 2018. The £10,000,000
term loan is being repaid on a quarterly basis to maturity, and the drawn RCF
and any further drawings under the RCF are repayable on maturity of the
facility. The facility may be used for deferred consideration payments on past
acquisitions, to fund future potential acquisitions, and for general working
capital requirements.
Loan arrangement fees of £285,000 (2014: £143,000 in relation to the old
facility) are offset against the term loan, and are being amortised over the
period of the loan. The remaining loan arrangement fees of £131,000 in
relation to the old facility were written off on refinancing and are reflected
in highlighted items.
The facility bears variable interest of LIBOR plus a margin of 2.50%. The
margin rate is able to be lowered each quarter end from April 2015 depending
on the Group's net debt to EBITDA ratio.
The undrawn amount of the revolving credit facility is liable to a fee of 40%
of the prevailing margin. The Group may elect to prepay all or part of the
outstanding loan subject to a break fee, by giving 5 business days' notice.
All amounts owing to the bank are guaranteed by way of fixed and floating
charges over the current and future assets of the Group. As such, a composite
guarantee has been given by all significant subsidiary companies in the UK,
USA and Germany.
During the year, the Group held floating to fixed interest rate swaps against
50% of its original sterling denominated term loans under the old facility for
the period from May 2012 to April 2015. These instruments matured on 30 April
2015.
Contingent deferred consideration represents additional amounts that are
expected to be payable for acquisitions made by the Group and is held at fair
value at the Statement of Financial Position date. All amounts are expected to
be fully paid by August 2017.
All finance lease liabilities fall due within five years. The minimum lease
payments and present value of the finance leases are as follows:
Minimum lease payments
Year ended30 April 2015 Year ended 30 April 2014
£'000 £'000
Amounts due:
Within one year 6 203
Between one and five years 18 27
24 230
Less: finance charges allocated to future periods (7) (16)
Present value of lease obligations 17 214
The minimum lease payments approximate the present value of minimum lease
payments.
9. Cash generated from operations
Year ended Year ended
30 April 2015 30 April 2014
£'000 £'000
Profit before taxation 4,657 3,440
Adjustments for:
Depreciation (note 11) 1,249 1,102
Amortisation (note 10) 2,515 2,200
Finance costs - loan fees written off (note 3) 131 -
Interest rate swap closure 29 -
Profit on disposal (1) -
Unrealised foreign exchange loss 208 814
Share option charges (note 3) 1,215 337
Finance income (note 6) (8) (15)
Finance expenses (note 6) 1,179 1,206
Share of profit of associates (note 13) (12) (19)
Contingent deferred consideration revaluations 548 1,603
11,710 10,668
Increase in trade and other receivables (2,270) (3,467)
Decrease in trade and other payables (1,040) (692)
Movement in provisions (473) 290
Cash generated from operations 7,927 6,799
10. Acquisitions
Media Value SL Group ("Media Value")
On 26 February 2015, the Group acquired the entire issued share capital of
Media Value SL, the Spain incorporated holding company of the Media Value SL
Group ("Media Value"). The initial cash consideration was EUR 743,000
(£545,000). Additional consideration is payable dependent on future
performance during the three financial years ending 30 April 2016 and will be
paid in cash. The maximum total consideration payable is EUR 6,000,000
(£4,398,000).
Media Value contributed £453,000 to revenue and £218,000 to profit before tax
for the period between the date of acquisition and the year end.
The carrying value and the fair value of the net assets at the date of
acquisition were as follows:
Carrying value Recognised on acquisition
£'000 £'000
Customer relationships - 1,559
Property, plant and equipment and computer software 20 20
Trade and other receivables 789 789
Cash and cash equivalents 122 122
Trade and other payables (980) (980)
Deferred tax liability - (437)
Net assets acquired (49) 1,073
Goodwill arising on acquisition 2,787
3,860
The fair value of trade and other receivables includes trade receivables with
a fair value and gross contractual value of £576,000.
The goodwill is attributable to the assembled workforce, expected synergies
and other intangible assets, which do not qualify for separate recognition.
Purchase consideration:
£'000
Cash 545
Contingent deferred consideration 3,315
Total purchase consideration 3,860
The fair value of contingent deferred consideration payable is based on EBIT
for the years ended 30 April 2014, 20 April 2015 and 30 April 2016. The
potential range of future payments that Ebiquity plc could be required to make
under the contingent consideration arrangement is between £nil and £3,854,000
and will be paid in cash. All contingent deferred consideration payments are
expected to be paid by August 2016.
TRANSACTIONS WITH NON CONTROLLING INTERESTS
On 7 May 2014, the 5% minority shareholder of the Group's subsidiary
undertaking, Billetts America LLC, exercised their option to increase their
shareholding to 15%. The Group then acquired the remaining 15% in Billetts
America LLC from the minority shareholder. The consideration payable for these
interests is dependent on the performance of the business of Billetts America
LLC during the three financial years ending 30 April 2015.
On 13 February 2015, the Group increased its interest in Ebiquity Germany GmbH
to 94.03% through the issue of 966,413 shares in Ebiquity plc.
DISPOSALS
On 16 July 2014, the Group sold its 50% investment in FLE Latam SAS
(Registered in Colombia) for cash of $1,000 (approximately £600). A profit of
£600 was made on the sale.
On 1 August 2014, the Group sold its 25% investment in its associate company
SLiK Media (incorporated in the United Kingdom) for cash of £68,000. A profit
of £700 was made on the sale.
If all of the above transactions had been completed on 1 May 2014, Group
revenue would have been £75,668,000 and Group operating profit before
highlighted items would have been £12,062,000, before any potential
synergistic benefits are taken into account.
None of the goodwill arising from the acquisitions in the year is expected to
be tax deductible.
11. Financial Information
The financial information included in this report does not amount to full
financial statements within the meaning of Section 434 of Companies Act 2006.
The financial information has been extracted from the Group's Annual Report
and financial statements for the year ended 30 April 2015, on which an
unqualified report has been made by the Company's auditors,
PricewaterhouseCoopers LLP.
Financial statements for the year ended 30 April 2014 have been delivered to
the Registrar of Companies; the report of the auditors on those accounts was
unqualified and did not contain a statement under Section 498 of the Companies
Act 2006. The 2015 statutory accounts are expected to be published on 14
August 2015.
This information is provided by RNS
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