REG - System1 Group PLC - PRELIMINARY RESULTS FOR THE YEAR ENDED 31 MAR 2022
12/07/2022 07:00
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RNS Number : 0927S System1 Group PLC 12 July 2022
12 July 2022
System1 Group PLC (AIM: SYS1)
("System1" or "the Group" or "the Company")
Preliminary results for the year ended 31 March 2022
System1 Group, the marketing decision-making platform, announces its
preliminary results for the year ended 31 March 2022.
Highlights
2021/22 2020/21 Change**
Management Basis* £m £m %
Revenue 24.1 22.8 6%
Gross profit 20.2 19.2 5%
Adjusted operating costs (19.2) (16.2) 18%
Adjusted profit before taxation 1.0 3.0 -65%
2021/22 2020/21 Change**
Statutory Basis £m £m %
Revenue 24.1 22.8 6%
Gross profit 20.2 19.2 5%
Operating costs (19.6) (17.7) 11%
Other operating income 0.3 0.6 -55%
Profit before taxation 0.9 2.1 -54%
Tax credit/(charge) 0.0 (0.4) -103%
Profit for the financial year 0.9 1.7 -46%
Diluted earnings per share 7.4p 13.1p
* Adjusted Operating Costs exclude impairment, interest, share based payments,
bonuses and commissions, severance costs and government support related to the
Covid pandemic. Adjusted figures exclude items, positive and negative, that
impede easy understanding of underlying performance. See note 4 to the
consolidated financial statements for further information.
** Year-on-year percentage change figures are based on unrounded numbers.
· Revenue increased 6% to £24.1m. Data Revenue increased by £8.4m
year on year to £9.7m (H2: £5.3m), representing 40% of the total (H2: 45%)
· Adjusted Operating Costs increased 18% year on year, reflecting
the planned investment in people, partnerships and platform
· Adjusted Profit before Taxation dropped 65% to £1.0m
· Statutory Operating Costs up 11% to £19.6m. Statutory Profit
before Taxation down 54% to £0.9m
· Share-based payment expense £0.3m (2020/21: £0.1m)
· Statutory Profit for the financial year down from £1.7m to
£0.9m
· Diluted earnings per share 7.4p (2020/21: 13.1p)
· Cash net of borrowings (excluding lease liabilities) up by £2.2m
in the period to £8.7m, reflecting strong underlying cash flows, a £0.5m tax
credit receipt in Q1, and a £0.6m share buyback in Q4
Commenting on the Company's results, John Kearon, Chief Executive Officer,
said:
"Underneath the 6% growth, we have built a fast-growing £10m automated
marketing prediction business over the past two years. The majority of Data
sales are now coming from new customers, including the No.1 UK Advertiser,
No.1 UK Broadcaster, World's No.1 B2B platform, World's No.1 laptop
manufacturer, and World's No.2 sportswear brand. The most significant source
of new business has been through partnerships with advertising agencies and
media platforms like LinkedIn, ITV, and Globo. New and existing customers seem
genuinely excited by the accuracy, speed, and incredible value of our
advertising decision-making platform. We are committed to continuing our
investment in people, partnerships, and platform to develop and commercialise
our automated marketing predictions, to accelerate this growth."
The Company can be found at www.system1group.com.
This announcement contains inside information for the purposes of article 7 of
the Market Abuse Regulation (EU) 596/2014 as amended by regulation 11 of the
Market Abuse (Amendment) (EU Exit) Regulations 2019/310. With the publication
of this announcement, this information is now considered to be in the public
domain.
For further information, please contact:
System1 Group PLC Tel: +44 (0)20 7043 1000
John Kearon, Founder and Chief Executive Officer
Chris Willford, Chief Financial Officer
Canaccord Genuity Limited Tel: +44 (0)20 7523 8000
Simon Bridges / Andrew Potts
CEO's Statement
Test your… transformational potential
Top-line growth was 6%, reduced from our double-digit half-year growth by an
unexpected Q4 reduction in our US bespoke research business. We have rapidly
addressed the issues in the USA by injecting fresh talent and unifying our
sales and marketing activities under our Chief Customer Officer, Jon Evans,
and operations under our Chief Operating Officer, James Gregory.
Underneath our respectable but unspectacular 6% growth, was a far more
impressive 521% growth in our automated 'Predict Your Ad' platform business,
and a 419% growth in our associated 'Improve Your Ad' creative guidance. In
two years, we have built a £10m automated data business, with advertising
platform partners like LinkedIn, ITV, and Globo, winning significant new
customers like Lenovo and Intel, and growing existing significant customers
like adidas, Sky, Aldi, and Boston Beer. In the last year, almost a quarter of
our business, £6m, came from winning new customers to our 'Test Your Ad'
prediction platform. New and existing customers seem genuinely excited by the
accuracy, speed, and uncredible value of our advertising decision-making
platform, together with the clarity and helpfulness of our creative guidance.
Based on Test Your Ad's success, and to enhance our growth potential, we
completed and launched our automated 'Test Your Brand' platform, in November.
More recently, in May 2022, we launched our automated 'Test Your Idea'
platform, ensuring we can offer the same industry-leading predictions, 24-hour
turnaround, and best value prices, across all three parts of our business, in
every major market.
During the year, we significantly enhanced our industry profile, with Orlando
Wood's brilliant book on advertising effectiveness, Look out, along with our
Ad of the Week, Feeling Seen diversity report and Jon Evans' Uncensored CMO
podcasts.
I'm incredibly grateful for the hard work and brilliance of our staff, the
belief and commitment of an increasing number of industry-leading customers,
the terrific partnership of our suppliers, and the advice and encouragement of
our incredibly supportive shareholders.
Progress towards our goals
The year saw significant progress in the four progressive goals we set out
four years ago:
1. Build defensible assets
We have now tested over 80,000 ads, making Test Your Ad the world's largest
database of validated ad-effectiveness data of which we're aware. We use this
asset to continuously enhance our understanding of advertising and prove the
value of creativity to advertisers. The database continues to prove an
invaluable asset. Orlando Wood, our Chief Innovation Officer used the database
in his new book, Look out (now the IPA's Advertising biggest ever selling
book), acclaimed by such industry luminaries as Peter Field, co-author, The
Long and the Short of It, who said:
"If Orlando's last book, Lemon, was the wake-up call for those who champion
effectiveness, then Look out is the playbook for rebuilding the effectiveness
that advertising has lost over the last decade."
It has been a monumental task automating the many complex, sequential steps
involved in predicting the potential of our customers' advertising,
innovations, and brands. As of May 2022, every step that used to require
manual intervention, has been automated, ensuring we can offer our
industry-leading predictions, within 24-hours, at incredible value pricing,
across all three parts of our business. This amounts to an automated marketing
decision-making platform (Test Your Ad, Test Your Idea, and Test Your Brand),
giving us a huge competitive advantage in winning significant market share,
delighting our customers, and achieving our goals.
Platform Database Innovation
Test Your Ad Fully automated Jun 21 Now ~80,000 ads TYA Pro Reports Jun 21
UK 95% of all TV ads TYA Static Ads Feb 22
US 70% of all TV ads TYA Profit Projector Mar 22
Test Your Brand Fully automated Nov 21 Now ~6,000 brands TYB Pro Reports Nov 21
Test Your Idea Fully automated May 22 Now ~60,000 ideas TYI Pro Reports May 22
2. Generate fame
Testing every new US and UK ad across almost all categories, and many in our
other markets, Brazil, Germany, France, Asia, Australia, generated
significantly more coverage for System1 than in any previous year.
Ad of the Week, celebrating the best, most effective creative from around the
world has generated significant industry attention, and led to significant new
customer wins.
Feeling Seen, written in partnership with our partner ITV, is a
first-of-its-kind UK report exploring and celebrating the benefits of
inclusive advertising as seen through the eyes of real, diverse audiences. We
were able to prove diverse advertising isn't just about 'doing good' - it
leads to greater engagement and greater commercial effectiveness. The report
led directly to significant new customer wins. We've just published our US
Feeling Seen, with partners LinkedIn and BBDO, which is generating significant
interest.
The Uncensored CMO created by our Chief Customer Officer, Jon Evans,
interviewing industry luminaries, has become the pre-eminent marketing podcast
in our biggest markets which has led to significant new customer wins.
Look out, published in October 2021, has already been presented to 10,000
marketers from many of the world's largest advertisers, and led to significant
new customer wins. Orlando Wood is due to present our findings and advice for
improving advertising effectiveness, on the main stage at this year's Cannes
Advertising Festival, the world's leading industry event.
The Winning 11, written in partnership with our partners ITV and Globo,
summarises our advice to this year's soccer World Cup advertisers, on how to
make a famous, highly effective ad. The report is already starting to generate
significant industry attention and we're starting to test ads in development
for the event.
Our work has generated industry accolades from leading industry figures like
Professor Mark Ritson:
"System1 is special because you've looked at creativity in a far more detailed
way. You've balanced the creativity/media thing and done it on an
effectiveness basis."
3. Win new customers
Our Test Your Ad automation, increased industry profile, and Partnerships with
ITV, LinkedIn, Globo, enabled us to win 209 new customers in the year, many of
which are industry leaders like Lenovo and H&M. Our total customer base
rose to 465, an increase of 17%.
Having completed and launched our Test Your Brand automation in November 2021,
and our Test Your Idea automation in May this year, our sales team are working
hard to achieve the same success and growth in new customers and revenue
achieved with our Test Your Ad automation.
4. Generate new revenues
Test Your Ad revenues increased six-fold year on year, making it now our most
popular product, accounting for 31% of our revenues. Just over half of TYA
revenue came from customers won since April 2020.
Partnerships with major advertising platforms, including ITV and LinkedIn,
have produced multiple new customer leads, and Test Your Ad has become a key
element in our partners commitment to improving their advertisers'
effectiveness and drive their own revenues and profitability. LinkedIn have
acknowledged us as a key partner in helping them increase their advertising
business by $200m in the last year.
In contrast to the growing success of our automated marketing decision-making
platform, our bespoke research business declined by 39% during the year,
reducing its contribution to 48% of total revenues. This was particularly the
case in our bespoke consultancy business in the Americas, which declined 52%
in the year. A sizeable proportion of our bespoke research revenues come from
our traditional innovation testing business. Our hope is the new automated
Test Your Idea will repeat the success of Test Your Ad, converting existing
customers and winning new customers to the faster, cheaper, platform solution.
Outlook
Over the last few years, we have made the creative and financial investments
needed to take our industry-leading IP and create a market-leading, automated
'Predict Your…' platform, complemented by best-in-class 'Improve Your…'
consultancy. We've hired additional talent capable of winning over Chief
Marketing Officers of big companies, been recognised as thought-leaders and
champions for creativity backed by data and built a management team capable of
achieving our ambitious goals. There remains much to do, but we believe our
marketing decision-making platform is far ahead of our competitors and
combined with our ability to advise customers on how to improve the
effectiveness of their marketing, leaves the company well-placed for
accelerated growth and influence in the industry.
There are of course, two known headwinds for us to face and overcome: the
exposure of a few of our large customers to the loss of their Russian market,
which has already led to reduced marketing budgets; and the looming threat and
impact of a recession on our customers' marketing investment.
Finally, I would like to say a heartfelt thank you to our talented and
committed staff, enthusiastic and appreciative customers, and incredibly
supportive shareholders.
In the spirit of appreciation: Gratitude Ignites. Gratitude Attracts.
Gratitude Accelerates.
John Kearon
Founder & Chief Executive Officer
Financial Review
Overview
2022 2021 Change Change**
£m £m £m %
Revenue 24.1 22.8 1.3 6%
Gross profit 20.2 19.2 1.0 5%
Adjusted operating costs* (19.2) (16.2) (3.0) 18%
Adjusted profit before taxation* 1.0 3.0 (2.0) -65%
Statutory profit before taxation 0.9 2.1 (1.2) -54%
Taxation 0.0 (0.4) 0.4 103%
Statutory profit for the financial year 0.9 1.7 (0.8) -46%
*All figures in the Financial Review are presented in millions rounded to one
decimal place unless specified otherwise. Percentage movements are calculated
based on the numbers reported in the financial statements and accompanying
notes. Adjusted Revenue, Cost and Profit figures are as defined in the
Highlights section.
** Year-on-year percentage change figures are based on unrounded numbers.
Revenue rose by £1.3m (6%) in the year to £24.1m with strong growth in
automated ad-testing revenues partly offset by declines in legacy complex
consultancy projects. As anticipated, adjusted operating costs increased
appreciably versus the Covid-affected prior year as the company continued to
invest in people, platform and partnerships. Adjusted profit before tax
declined by £2.0m in the year due partly to the decline in our USA
consultancy revenues in the final quarter. Statutory profit before taxation
decreased by £1.2m to £0.9m.
Profit for the financial year fell by £0.8m to £0.9m. Diluted Earnings Per
Share of 7.4p compared to the previous year's Earning Per Share of 13.1p.
Revenue performance
Last year was the first full year of Test Your Ad, our leading automated data
product. Test Your Brand launched during the year, and Test Your Idea has just
come to market in the new financial year. Data products represented 40% of
Revenue for the year as a whole (2020/21: 6%), with the proportion of data
sales rising over the period to reach 45% in the second half-year. We have in
effect built a £10m data business in 18 months, just over 60% of it coming
from new customers.
The company's focus on the new automated product set has coincided with softer
revenues from legacy complex consultancy assignments, especially from
Innovation and in the USA.
The success of Test Your Ad led to Communications revenue growing in all
geographic regions and representing 62% of Group's Revenue for the year. This
was offset by declines in our customers' Innovation spend, particularly in the
Americas and APAC. The Brand product area fell back year on year, as we
converted low-profit, high-effort bespoke brand tracking business to Test Your
Brand.
Sales of Test Your Ad in UK and Europe contributed to the growth in both these
areas. Despite a disappointing final quarter, the Americas region returned to
growth, with significant new ad-testing wins offsetting declines in the
innovation consultancy business. The Asia-Pacific revenues fell back from a
strong prior year performance.
Operating expenditure
We made it clear a year ago that expenditure would rise steeply year on year,
partly as a result of the Covid-related reduction in costs during FY 2020/21
and also because of our decision to accelerate the development of the
automated predictions platform and the partnership approach to new business
development.
As a consequence of those plans, adjusted operating costs increased by 18% to
£19.2m. The biggest area of increase was sales and marketing. Of the £3.0m
cost increase year on year about a half was people costs and the other half
external spend such as fame-building activity including Ad of the Week and the
launch of Look out and Feeling Seen. In the prior year we had a number of
employees on reduced hours during the first wave of the pandemic and were
carrying some vacancies. The next largest increase was in IT, primarily due to
the growth in the number of in-house developers working on new platform
features including Test Your Brand and Test Your Idea. We also expanded the
number of categories on the TYA Premium database (previously called the
AdRatings Database), which now 95% has coverage in the UK and nearly 60% in
the US.
Direct costs (those between Revenue and Gross Profit) rose in line with
revenue, producing a stable gross profit margin of 84%.
Tax
The Group's effective tax rate fell from 19% to -1% due mainly to the higher
proportional impact of R&D tax credits (£0.5m recognised in the period)
on lower taxable profits. We have submitted a £0.2m R&D tax credit claim
for FY 2020/21 which is yet to be approved or recognised.
Funding and liquidity
The Group began the year with £9.0m cash on the balance sheet and ended with
£11.2m: funding from the £2.5m revolving credit facility is included in both
years' balances. Cash net of debt rose from £6.5m to £8.7m. The £2.2m cash
inflow is attributable to £2.5m cash generated from operations before tax and
after property lease costs, £0.5m tax credit, and a £0.3m favourable
translation effect of non-sterling bank balances reflecting primarily the
weakening of the pound against the dollar around the year end. These inflows
were partially offset by £0.5m tax paid, £0.1m capital expenditure, and loan
interest £0.1m, and a £0.6m share buyback in the final quarter.
Some £3.8m cash was spent on research and development in the year, related
primarily to the development of new intellectual property, automated
prediction products and the TYA Premium database.
No dividends were declared or paid in the year. During the final quarter the
Company spent £0.6m repurchasing 158,674 ordinary shares on market. The
repurchased shares are now held in treasury with no voting or dividend rights.
Distribution policy
Since the year-end the Company has clarified its policy on capital
distribution and the Board has decided to pay annual distributions to
shareholders by way of on market share buyback or tender offer, rather than by
way of a dividend. The Board has concluded that the distribution policy will
be progressive, taking into account underlying business performance. It is
expected that the absolute level of distribution for the year end 31 March
2023 will be between 30-40% of through-the-cycle profit after tax. The Board
is comfortable that this policy will support continued investment in the
business, provide funds for potential in-fill acquisitions to supplement
organic growth and will deliver returns to shareholders. In addition,
reflecting the strong cash position of the Group, the Board announced a
near-term return of capital of up to £1.5m worth of shares by way of a tender
offer at the earliest opportunity.
Litigation
On 27 September 2021, the Company filed a complaint for trademark
infringement, unfair competition and deceptive trade practices at the United
States District Court Southern District of New York against System1 LLC
("LLC"), since renamed System1 Inc., an omnichannel customer acquisition
marketing provider, over their infringing use of the mark "SYSTEM1". The
matter is still at an early stage and at the time of publication the court is
reviewing a motion to dismiss from LLC.
Consolidated Income Statement (unaudited)
for the year ended 31 March 2022
Note 2022 2021
£'000 £'000
Revenue 3 24,097 22,838
Cost of sales (3,898) (3,686)
Gross profit 20,199 19,152
Administrative expenses 4 (19,383) (17,517)
Other operating income 289 652
Operating profit 1,105 2,287
Finance expense 4 (160) (211)
Profit before taxation 945 2,076
Income tax credit/(expense) 10 (386)
Profit for the financial year 955 1,690
Attributable to the equity holders of the Company 955 1,690
Earnings per share attributable to equity holders of the Company
Basic earnings per share 5 7.4p 13.4p
Diluted earnings per share 5 7.4p 13.1p
Consolidated Statement of Comprehensive Income (unaudited)
for the year ended 31 March 2022
2022 2021
£'000 £'000
Profit for the financial year 955 1,690
Other comprehensive income:
Items that may be subsequently reclassified to profit/(loss)
Currency translation differences on translating foreign operations 349 (278)
Other comprehensive profit/(loss) for the period, net of tax 349 (278)
Total comprehensive income/(loss) for the period attributable to equity 1,304 1,412
holders of the Company
Consolidated Balance Sheet (unaudited)
as at 31 March 2022
Registered company no. 05940040
2022 2021
£'000 £'000
ASSETS
Non-current assets
Property, plant, and equipment 2,054 1,435
Intangible Assets 382 418
Deferred tax asset 292 286
2,728 2,139
Current assets
Contract assets 198 318
Trade and other receivables 4,492 5,880
Cash and cash equivalents 11,174 9,008
15,864 15,206
Total assets 18,592 17,345
EQUITY
Attributable to equity holders of the Company
Share capital 132 132
Share premium account 1,601 1,601
Merger reserve 477 477
Foreign currency translation reserve 203 (146)
Retained earnings 5,850 5,170
Total equity 8,263 7,234
LIABILITIES
Non-current liabilities
Provisions 432 560
Borrowings 2,500 2,500
Lease liabilities 1,417 928
4,349 3,988
Current liabilities
Provisions 77 200
Lease liabilities 1,091 1,647
Contract liabilities 991 803
Income taxes payable 267 334
Trade and other payables 3,554 3,139
5,980 6,123
Total liabilities 10,329 10,111
Total equity and liabilities 18,592 17,345
Consolidated Statement of Cash Flows (unaudited)
for the year ended 31 March 2022
2022 2021
£'000 £'000
Net cash generated from operations 4,098 3,791
Tax paid (63) 332
Net cash generated from operating activities 4,035 4,123
Cash flows from investing activities
Purchases of property, plant, and equipment (79) (102)
Purchase of intangible assets (59) (96)
Net cash used by investing activities (138) (198)
Net cash flow before financing activities 3,897 3,925
Cash flows from financing activities
Interest paid (161) (211)
Property lease liability payments (1,218) (1,093)
Purchase of own shares (567) -
Net cash used by financing activities (1,946) (1,304)
Net increase in cash and cash equivalents 1,951 2,621
Cash and cash equivalents at beginning of year 9,008 6,650
Exchange gain/(loss) on cash and cash equivalents 215 (263)
Cash and cash equivalents at end of year 11,174 9,008
Office lease costs are not included within "Net cash flow before financing
activities" (the Company's key cash flow performance indicator). "Net cash
flow before financing activities", adjusted for office leases, known by the
Company as "Operating cash flow" is shown below:
2022 2021
£'000 £'000
Net cash flow before financing activities 3,897 3,925
Net cash flow for property leases (1,307) (1,229)
Operating cash flow 2,590 2,696
Consolidated Movements in Net Cash/(Debt)
Cash and cash equivalents Borrowings Lease liabilities Total
£'000 £'000 £'000 £'000
At 1 April 2021 9,008 (2,500) (2,575) 3,933
Cash flows 1,951 - 1,218 3,169
Non-cash charges
Interest on lease liabilities - - (89) (89)
New lease liabilities - - (1,704) (1,704)
Disposal of lease liabilities - - 601 601
Exchange and other non-cash movements 215 - 42 257
At 31 March 2022 11,174 (2,500) (2,507) 6,167
Consolidated Statement of Changes in Equity (unaudited)
for the year ended 31 March 2022
Share capital Share premium account Merger reserve Foreign currency translation reserve Retained earnings Total
£'000 £'000 £'000 £'000 £'000 £'000
At 31 March 2020 132 1,601 477 132 3,416 5,758
Loss for the financial year - - - - 1,690 1,690
Other comprehensive income:
- currency translation differences - - - (278) - (278)
Total comprehensive income 132 1,601 477 (146) 5,106 7,170
Transactions with owners:
Employee share options:
- value of employee services - - - - 22 22
- deferred tax credited to equity - - - - 25 25
- adjustments with respect to prior year - - - - 17 17
At 31 March 2021 132 1,601 477 (146) 5,170 7,234
Profit for the financial year - - - - 955 955
Other comprehensive income:
- currency translation differences - - - 349 (7) 342
Total comprehensive income 132 1,601 477 203 6,118 8,531
Transactions with owners:
Employee share options:
- value of employee services - - - - 299 299
Purchase of treasury shares - - - - (567) (567)
At 31 March 2022 132 1,601 477 203 5,850 8,263
Notes to the Consolidated Financial Statements
for the year ended 31 March 2022
1. General information
System1 Group PLC (the "Company") was incorporated on 19 September 2006 in the
United Kingdom. The Company's principal operating subsidiary, System1 Research
Limited, was at that time already established, having been incorporated on 29
December 1999. The address of the Company's registered office is 4 More London
Riverside, London, England, SE1 2AU. The Company's shares are listed on the
AIM Market of the London Stock Exchange ("AIM").
The Company and its subsidiaries (together the "Group") provide marketing and
market research consultancy services.
The unaudited summary financial information set out in this announcement does
not constitute the Group's consolidated statutory accounts for the years ended
31 March 2022 and 2021. The results for the year ended 31 March 2022 are
unaudited. The statutory accounts for the year ended 31 March 2022 will be
finalised on the basis of the financial information presented by the Directors
in this preliminary announcement and will be delivered to the Registrar of
Companies in due course. The statutory accounts are subject to completion of
the audit and may also change should a significant adjusting event occur
before the approval of the Annual Report.
The statutory accounts for the Group for the year ended 31 March 2021 have
been reported on by the Group's auditor and delivered to the Registrar of
Companies. The auditor's report on those accounts was unqualified and did not
include references to any matter which the auditors drew attention by way of
emphasis without qualifying their report and did not contain statements under
section 498(2) or (3) of the Companies Act 2006.
The unaudited summary financial information set out in this announcement have
been prepared using the accounting policies as described in the 31 March 2021
audited year end statutory accounts and have been consistently applied.
The preliminary announcement for the year ended 31 March 2022 was approved by
the Board for release on 12 July 2022.
2. Basis of preparation
The Group has prepared its consolidated financial statements in accordance
with international accounting standards in conformity with the requirements of
the Companies Act 2006 and applicable law. The consolidated financial
statements have been prepared under the historical cost convention.
The preparation of financial statements in accordance with International
Financial Reporting Standards ("IFRS") requires the use of certain critical
accounting estimates. It also requires management to exercise its judgement in
the process of applying the Group's accounting policies.
Items included in the financial statements of each of the Group's entities are
measured using the currency of the primary economic environment in which the
entity operates ("the Functional Currency"). The consolidated financial
statements are presented in Pounds Sterling (GBP), which is the Company's
functional and presentation currency. The financial statements are presented
in round thousands unless otherwise stated.
3. Segment information
The financial performance of the Group's geographic operating units
("Reportable Segments") is set out below. The Group defines its Consultancy
business as a Research and Advertising Agency.
2022 2021
Revenue Revenue
£'000 £'000
By location of customer
Americas 9,043 8,822
United Kingdom 7,918 6,780
Rest of Europe 5,463 5,233
APAC 1,673 2,003
24,097 22,838
Segmental revenue is revenue generated from external customers and so excludes
intercompany revenue and is attributable to geographical areas based upon the
location in which the service is delivered.
Consolidated balance sheet information is regularly provided to the Executive
Directors while segment balance sheet information is not. Accordingly, the
Company does not disclose segment balance sheet information here.
2022 2021
Revenue Revenue
£'000 £'000
By product variant
Data 9,747 1,480
Consultancy 14,102 20,561
Other services 248 797
24,097 22,838
By product group
Communications (Ad Testing) 14,955 10,603
Brand (Brand Tracking) 3,295 3,796
Innovation 5,599 7,642
Other services 248 797
24,097 22,838
As the Company is domiciled in the UK, its consolidated non-current assets,
other than financial instruments and deferred tax assets are as follows:
2022 2021
£'000 £'000
Non-current assets
United Kingdom 1,846 1,778
Rest of world 590 75
2,436 1,853
4. Reconciliation between Operating Costs and Adjusted Operating Costs
2022 2021
£'000 £'000
Administrative expenses 19,383 17,517
Finance expense 160 211
Total operating costs 19,543 17,728
Less: Adjusting items
Impairment (235) 990
Compensation for loss of office 81 564
Bonus and commissions expense 268 (161)
Share-based payment expense 270 75
Other interest expense 70 75
Other staff costs (211) (31)
Trademark litigation 150 -
393 1,512
Adjusted operating costs 19,150 16,216
Of other staff costs, a sabbatical provision of £213,000 was released in the
year (2020/21: £36,000).
5. Earnings per share
2022 2021
Profit/(loss) attributable to equity holders of the Company, in £'000 955 1,690
Weighted average number of Ordinary Shares in issue 12,863,257 12,657,318
Basic earnings/(losses) per share 7.4p 13.4p
Profit/(loss) attributable to equity holders of the Company, in £'000 955 1,690
Weighted average number of Ordinary Shares in issue 12,863,257 12,657,318
Share options 12,881 193,768
Weighted average number of Ordinary Shares for diluted earnings per share 12,876,138 12,876,138
Diluted earnings/(losses) per share 7.4p 13.1p
Basic earnings/(losses) per share is calculated by dividing the profit or loss
attributable to equity holders of the Company by the weighted average number
of Ordinary Shares in issue during the year.
Diluted earnings/(losses) per share is calculated by adjusting the weighted
average number of shares outstanding assuming conversion of all dilutive share
options to Ordinary Shares. Options are included in the determination of
diluted earnings per share if the required performance thresholds would have
been met based on the Group's performance up to the reporting date, and to the
extent that they are dilutive.
Employee options of 1.2 million (2021: 1.4 million) have not been included in
the calculation of diluted EPS because their exercise is contingent on the
satisfaction of certain criteria that had not been met at 31 March 2022.
6. Dividends
The Company did not pay an interim dividend in the year ended 31 March 2022
and does not propose the payment of a final dividend.
No dividends were paid to directors in the years ended 31 March 2022 and 2021.
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