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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Fuse 8 | LSE:FUZ8 | London | Ordinary Share | GB00B66Q8C12 | ORD 2P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 4.00 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
0 | 0 | N/A | 0 |
TIDMFUZ8
RNS Number : 9706X
Fuse 8 PLC
15 December 2010
Date: 15 December 2010 On behalf of: Fuse 8 plc ('Fuse 8' or 'the Company') Embargoed until: 0700hrs
Fuse 8 plc
Interim results for the six months ended 30 September 2010
Fuse 8 plc (AIM: FUZ 8), the full service digital marketing agency, is pleased to announce its interim results for the six month period ended 30 September 2010.
Financial Highlights
-- Turnover of GBP2.40 million (2009: GBP2.06million)
-- Revenue of GBP1.63 million (2009: GBP1.54million)
-- Headline Operating Profits of GBP229,000 (2009: GBP384,000)
-- Cash balance GBP384,000 (2009: GBP149,000)
Operational Highlights
-- Completion of reverse acquisition and admission to AIM in July 2010
-- First step of strategic plan implemented with acquisition of digital agency in London in November 2010
-- New business wins include: Adidas, Asda and Soreen
Commenting on the Interim results Nigel Hunter, Chief Executive Officer said:
"We believe that AIM will be a great platform for us to achieve the Company's growth plans and, with this in mind, I am very pleased to be able to report such robust maiden results.
"We are optimistic for the next half and look forward to continuing to implement Fuse 8's strategic plan of growing the business organically while adding to our technical and service offer through targeted acquisitions."
For Further Information please contact:
Fuse 8 plc Nigel Hunter/Graeme Burns Tel +44 (0)113 260 4600 finnCap Geoff Nash/ Charlotte Stranner Tel +44 (0) 20 7600 1658 Redleaf Communications fuse8@redleafpr.com Rebecca Sanders-Hewett/ Lucy Salaman Tel +44 (0) 20 7566 6700
Notes to editors:
Fuse 8 is a full service digital marketing specialist covering a wide spectrum of services, ranging from creative development services to Search Engine Optimisation (SEO). Fuse 8, has offices in Leeds and Russia, centres most of its services around enhancing clients' reputations by helping to market and build their brands. The Group's principal expertise is in assisting its clients to build, grow and develop their online brands and, through this, help to drive sales and market share growth.
Fuse 8's current service offering encompasses the six main sectors below:
-- Online Design & Build
-- Digital Marketing
-- Creative Services
-- Media Planning & Buying
-- Marketing Consultancy
-- Online Press & Public Relations, Online Content
Fuse 8 was founded in 2000 by Mark Walton and Andy Hutchinson. As an early adopter of online technology, the Company has spent ten years developing and refining its digital marketing offering and has grown rapidly in a fragmented marketplace. The business now services more than 100 clients across the UK, Continental Europe, and the USA. Major clients currently include: Adidas, Arla Foods, Alton Towers, Asda, British Airways, Central Office of Information, Manpower, Miele, Persimmon Homes, Soreen, and UK Trade & Investment.
Fuse 8 is listed on the London Stock Exchange under the symbol FUZ8. Further information on the Company can be found at www.fuse8.com
INTERIM MANAGEMENT REPORT - SIX MONTHS TO 30 SEPTEMBER 2010
Chief Executive's Statement
It gives me great pleasure to deliver our maiden interim report following the Company's admission to AIM in July 2010.
During the six months to 30 September 2010 the Company has increased sales and, more importantly, revenues by some 17% and 6% respectively representing a solid start to our fifth consecutive year of revenue growth.
Fuse 8's client offering combines conventional marketing services with fully integrated online and digital marketing services which enable it to provide clients with a seamless service across all media channels. The benefits of the digitally focussed services we provide our clients are reflected in our continued revenue growth. The challenging economic climate of the last two years has meant that clients are looking for more tangible value for their marketing spend, and the highly measurable results achieved through digital communications help to ensure a more robust digital market. Accordingly, increasing proportions of our client's budgets are being spent on digital communications and our ten year heritage in digital marketing means that clients need and value the expertise we can apply to servicing them.
Clients continue to utilise the skills of Fuse 8 for both their digital and traditional marketing activities. However, the latest trends and new business activity continues to shift the majority of activity into the digital arena. Demand and appetite for new innovations has grown steadily over the period with clients old and new looking particularly to mobile technology and applications to form part of their overall digital communications strategy.
Fuse 8 is not immune to the economic difficulties affecting the UK and Europe. The Company has seen some clients, most noticeably in the public sector, being slower to commit to previously agreed plans or spend. However a diverse client base and a focus on new business has allowed the Company to continue growing revenue and to invest in its digital offering for clients. By producing measurable results Fuse 8 has become a strong player in this value conscious environment.
Fuse 8's office in Russia offers an offshore technology and digital production centre that has been operating successfully for the last seven years. Currently 35 highly skilled employees act as our centre of excellence in Russia delivering a high quality service for clients.
For Fuse 8's first interim report I am pleased to announce good progress on some key facets of the Company's development and, following this very active period, the business is better positioned than ever to deliver expert communication solutions to clients across a wider geography in the maturing digital arena.
Financial Overview
The balance sheet remains sound and for a business of our size we have robust cash balances and net current assets. Underlying cash generation continues to be positive although as a result of continually growing sales some of our cash reserves are utilised as working capital.
Significant investment has been made in business development activities including an increased business development resource, staff training and additional sales support. As a result, operating margins have been impacted slightly, though long-term delivery of profits continues. Whilst the operating margin of 14% achieved in the period is slightly below prior year levels, it is in line with the Board's expectations due to increased investment in staff and resources to drive organic growth. The Company anticipates that margins will return to previous levels as the Company continues the growth in revenue and leverages the advantage that our Russia office affords.
Strategy
As stated at the time of Fuse 8's admission to AIM, the Company's plan is to grow income and profits, steadily over time, both organically and by acquisition, to become one of the pre-eminent digital marketing agencies in the UK. The financial and operational achievements of the first six months represent positive steps in that plan.
The Company's organic growth is supported by investment in the marketing technology toolbox that we use to deliver services that, in turn, help to continually enhance our offering. The Board recognises that a greater spread of resource throughout the UK and London in particular, will help increase the Company's efficiency and profile and to that end is regularly appraising acquisition opportunities.
New Business
New business opportunities continue at pace, with Fuse 8's core digital services providing the Company with a firmer foothold with existing clients as well as helping to create dialogue with potential new clients.
Fuse 8 has three strategic areas from which it targets new business; cross selling of services to its current clients; winning new clients; and through strategic partnerships. New client wins during the period include Adidas, Asda and Soreen.
Post Period
Following the end of the six months under review Fuse 8 completed its first acquisition. Delete Digital Marketing, which was acquired in November, gives the Group both the London office it sought and a complementary team of experienced digital specialists. Delete also has a number of important clients including a range of high quality consumer and business brands such as BaByliss, Decca Records and Red Bull.
Summary & Outlook
Continued positive earnings throughout the period, during which the Company listed on AIM and the continued search for suitable acquisition opportunities, is testament to the strength of the entire Fuse 8 team. I would like to take this opportunity to thank each member of our team for their contribution towards our good performance.
The first half of the year has seen steady progress and there is positive momentum driving the Group forward with an encouraging new business pipeline. We believe that the second half will deliver further very positive steps in our growth plans. Whilst other companies are leaving AIM, I am pleased to be able to report such strong prospects for the Company; Fuse 8 is emerging as a forward thinking digital agency and the platform AIM provides should help propel the Company onwards in its ambition to become one of the UK's pre-eminent digital agencies.
Nigel Hunter
Chief Executive Officer
15 December 2010
Interim group statement of comprehensive income
for the six months ended 30 September 2010
6 months ended 6 months ended Year ended 30 September 2010 30 September 2009 31 March 2010 GBP'000 GBP'000 GBP'000 Unaudited Unaudited Unaudited Turnover 2,407 2,063 4,512 Revenue 3 1,625 1,539 3,347 ---------------------- ----------------- ----------------- ------------- Administrative expenses 1,396 1,155 2,746 ---------------------- ----------------- ----------------- ------------- Headline operating profit 3 229 384 601 Exceptional costs 8 411 - - Operating (loss)/profit 3 (182) 384 601 Finance costs 10 6 17 Finance income (1) - (1) Net finance cost 9 6 16 (Loss)/ profit from continuing operations before tax (191) 378 585 Taxation charge 4 54 87 180 ---------------------- ----------------- ----------------- ------------- (Loss)/ profit for the period and total comprehensive income (245) 291 405 ---------------------- ----------------- ----------------- ------------- Attributable to: Parent company's shareholders (245) 291 405 Basic earnings per share from total operations 5 (2.2p) 2.8p 4.0p ---------------------- ----------------- ----------------- ------------- Diluted earnings per share from total operations 5 (2.2p) 2.8p 4.0p ---------------------- ----------------- ----------------- -------------
Interim group statement of financial position
as at 30 September 2010
30 September 2010 30 September 2009 31 March 2010 GBP'000 GBP'000 GBP'000 Unaudited Unaudited Unaudited Non-current assets ------------------------- ----------------- ----------------- ------------- Property, plant and equipment 342 281 315 Current assets Trade and other receivables 1,260 1,183 1,226 Cash and cash equivalents 390 149 284 ------------------------- ----------------- ----------------- ------------- 1,650 1,332 1,510 ------------------------- ----------------- ----------------- ------------- Total assets 1,992 1,613 1,825 ------------------------- ----------------- ----------------- ------------- Current liabilities Trade and other payables 860 714 744 Corporation tax 232 119 180 Financial liabilities 59 49 30 ------------------------- ----------------- ----------------- ------------- 1,151 882 954 ------------------------- ----------------- ----------------- ------------- Non-current liabilities Financial liabilities 90 77 103 Deferred tax 9 9 9 ------------------------- ----------------- ----------------- ------------- 99 86 112 ------------------------- ----------------- ----------------- ------------- Total liabilities 1,250 968 1,066 ------------------------- ----------------- ----------------- ------------- Net assets 742 645 759 ------------------------- ----------------- ----------------- ------------- Shareholders' funds Share capital 544 18 18 Share premium account 1,667 - - Capital redemption reserve - 2 2 Merger reserve (1,963) - - Retained earnings 494 625 739 Total equity 742 645 759 ------------------------- ----------------- ----------------- -------------
Interim group statement of change in equity
for the six months ended 30 September 2010
Share Capital Issued premium redemption Merger Retained Total capital account reserve reserve earnings equity GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 Balance at 1 April 2009 18 - 2 334 354 -------------- -------- -------- ------------ -------- --------- ------- Profit for the financial period - - - - 291 291 Total comprehensive income for the period - - - - 291 291 -------------- -------- -------- ------------ -------- --------- ------- Balance at 30 September 2009 18 - 2 - 625 645 Profit for the financial period - - - - 114 114 -------------- -------- -------- ------------ -------- --------- ------- Total comprehensive income for the period - - - - 114 114 -------------- -------- -------- ------------ -------- --------- ------- Balance at 31 March 2010 18 - 2 - 739 759 -------------- -------- -------- ------------ -------- --------- ------- Loss for the financial period - - - - (245) (245) Total comprehensive income for the period - - - - (245) (245) Reverse acquisition 526 1,667 (2) (1,963) - 228 Balance at 30 September 2010 544 1,667 - (1,963) 494 742 -------------- -------- -------- ------------ -------- --------- -------
Interim group statement cash flows
for the six months ended 30 September 2010
6 months ended 6 months ended Year ended 30 September 2010 30 September 2009 31 March 2010 GBP'000 GBP'000 GBP'000 Unaudited Unaudited Unaudited Cash inflow from operating activities Cash inflow from operating activities before tax 7 51 114 364 Corporation tax paid - - (32) ---------------------- ----------------- ----------------- ------------- Net cash inflow from operating activities after tax 51 114 332 Cash inflow/ (outflow) from investing activities Finance income received 1 - 1 Cash acquired on reverse acquisition 82 - - Purchase of property, plant and equipment (129) (128) (220) Proceeds from disposals of property, plant and equipment 69 - - ---------------------- ----------------- ----------------- ------------- Net cash inflow/ (outflow) from investing activities 23 (128) (219) ---------------------- ----------------- ----------------- ------------- Cash inflow from financing activities Finance cost paid 8 (6) (17) Hire purchase agreements 24 73 92 Net cash inflow from financing activities 32 67 75 ---------------------- ----------------- ----------------- ------------- Net increase in cash and cash equivalents 106 53 188 ---------------------- ----------------- ----------------- ------------- Cash and cash equivalents at beginning of period 284 96 96 Cash and cash equivalents at end of period 390 149 284 ---------------------- ----------------- ----------------- -------------
Notes to the interim group financial statements
for the six months ended 30 September 2010
1. GENERAL INFORMATION
Fuse 8 plc and its subsidiaries' principal activities are digital marketing communications services.
Fuse 8 plc, a Public Limited Company, is incorporated and domiciled in the United Kingdom.
The financial information set out in the interim report does not constitute statutory accounts as defined in the Companies Act 2006.
The statutory financial statements for the year ended 31 March 2010 for Fuse 8 Group Limited and for the year ended 30 September 2009 for Fuse 8 plc (formerly Award International Holdings plc), both prepared under United Kingdom General Accepted Accounting Practices (GAAP), have been filed with the Registrar of Companies. The auditor's report on those financial statements was unqualified and did not contain a statement under Sections 498 (2) and (3) of the Companies Act 2006.
The interim report was approved by the Board on 14 December 2010.
2. BASIS OF PREPARATION
The Company issued new shares in June 2010 to acquire the share capital of Fuse 8 Group Limited (see note 8). After the acquisition the directors of Fuse 8 Group Limited, owned the majority of Fuse 8 plc. Under International Financial Reporting Standards (IFRS), the transaction is deemed to be a reverse acquisition. The assets and liabilities of Fuse 8 Group Limited have been recognised and measured at their pre-combination carrying values and the comparative results are those of Fuse 8 Group Limited and therefore the retained earnings and other reserves brought forward are those of Fuse 8 Group Limited. The cost of the acquisition was measured at the fair value of the ordinary shares that were issued to effect the reverse acquisition. The assets and liabilities of Fuse 8 plc have been recognised at the fair value at the acquisition date. The premium arising on the acquisition has been written off within the income statement. The share capital and share premium at the period end are those of the parent company Fuse 8 plc. The movement in the share capital and share premium from Fuse 8 Group Limited to Fuse 8 plc is recognised in a merger reserve.
This consolidated financial information for the six months ended 30 September 2010 has been prepared in accordance with IAS 34, "Interim Financial Reporting" as adopted by the European Union. The interim group financial statements should be read in conjunction with the annual financial statements for the year ended 31 March 2010, for Fuse 8 Group Limited prepared in accordance with UK GAAP and the AIM listing document dated 23 June 2010 which converted the UK GAAP financial statements to comply with IFRS. No adjustments were required to the numbers reported initially under UK GAAP to comply with IFRS and as such the comparative numbers for 31 March 2010 and 30 September 2009 agree with those presented under UK GAAP.
This interim financial information has been prepared using the accounting policies set out in the Group's admission document to AIM published on 23 June 2010.
Copies of the interim results for the six months ended 30 September 2010 are being sent to all shareholders. A copy can also be found on the Company's website at www.fuse8.com.
Comparative period
The comparative period for the interim financial statements is for the six months to 30 September 2009 and the 12 months to 31 March 2010 which was the previous year end for Fuse 8 Group Limited. The 31 March 2010 figures are drawn from the audited financial statements of Fuse 8 Group Limited and will be the comparative period for the Group financial statements prepared to 31 March 2011 for the Fuse 8 plc Group. However, as those financial statements were prepared under UK GAAP, the 31 March 2010 figures have been described as unaudited.
The period end of Fuse 8 plc (the parent) has been extended by six months to 31 March 2011. Due to the use of reverse acquisition accounting prescribed under IFRS, the Group results at 31 March 2011 will represent:
- 12 month trade of Fuse 8 Group Limited (the trading subsidiary) - Fuse 8 plc results from the date of the reverse acquisition of 23 June 2010 to 31 March 2011.
Prior to the release of the interim financial statement for the six months to 30 September 2010, Fuse 8 plc (when it traded as Award International Holdings plc) released interim results for the six months to 31 March 2010 which were included in the AIM admission document published on 23 June 2010. The results included in those interims to 31 March 2010 related solely to the Company's activities as Award International Holdings plc and the results occurred prior to the reverse acquisition. As such, the 31 March 2010 interims have not been included in these interim group financial statements as comparative information as they have no relevance to the newly created Group.
3. segmental analysis
The Group operates in one business segment, the provision of digital marketing communications services. As such, no further segmental information has been disclosed.
4. Taxation charge
The taxation charge for the period ended 30 September 2010 differs to the standard rate of tax as explained below.
6 Months ended 6 Months ended Year ended 30 September 30 September 31 March 2010 2009 2010 GBP'000 GBP'000 GBP'000 (Loss)/ profit before taxation (191) 378 585 ---------------------------------- -------------- -------------- ---------- (Loss)/ profit before taxation by rate of tax of 28% (53) 105 164 Non tax deductible acquisition costs 115 - - Other timing differences (8) (19) 16 Taxation charge 54 87 180 ---------------------------------- -------------- -------------- ----------
5. EARNINGS PER SHARE
The calculation of the basic earnings per share is based on the profit on ordinary activities after tax and on the weighted average number of Ordinary shares in issue during the year.
As a result of the reverse acquisition, the weighted average number of shares up until the reverse acquisition is deemed to be the number of shares that were issued by Fuse 8 plc for the reverse acquisition.
The diluted earnings per share figure is the same as the basic earnings per share as no diluting shares or options exist.
The (loss)/ profit and weighted average number of shares used in the calculations are set out below:
(Loss)/ Basic and diluted profit Weighted average number Earnings per share earnings per share GBP'000 of shares Number '000 Pence ----------------------- -------- ----------------------- ------------------ 6 months ended 30 September 2010 (245) 11,350 (2.2p) 6 months ended 30 September 2009 291 10,215 2.8p Year ended months ended 31 March 2010 405 10,215 4.0p
6. Dividend
The Board of Directors does not recommend the payment of a dividend.
7. Net cash inflow from operating activities
6 Months Year 6 Months ended ended ended 30 September 30 September 31 March 2010 2009 2010 GBP'000 GBP'000 GBP'000 Operating (loss)/ profit (182) 384 601 Depreciation 42 39 98 Non cash element of acquisition costs 110 - - Profit on disposal of property, plant and equipment (9) - - Increase in receivables (36) (406) (448) Decrease in payables 126 97 114 -------------------------------- ------------------ ------------- --------- Net cash inflow from operating activities 51 114 364 -------------------------------- ------------------ ------------- ---------
8 Reverse acquisition
On the 23 June 2010, Fuse 8 plc (formerly Award International Holdings plc) acquired all of the issued share capital of Fuse 8 Group Limited. The transaction has been accounted for as a reverse acquisition under International Financial Reporting Standards. The amounts recognised for each class of assets, liabilities and contingent liabilities recognised at the acquisition date were as follows:
GBP'000 Trade and other receivables 41 Cash 82 ------- Trade and other payables (5) Net assets acquired 118 Non cash fair value of shares issued 228 Acquisition fees 301 ------- 529 Exceptional cost of acquisition recognised in the income statement 411 -------------------------------------------------- -------
This information is provided by RNS
The company news service from the London Stock Exchange
END
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