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| Share Name | Share Symbol | Market | Type |
|---|---|---|---|
| IMD International Medical Devices SpA | BIT:IMD | Italy | Ordinary Share |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 1.50 | 1.44 | 1.55 | 1.53 | 1.50 | 1.52 | 5,250 | 16:40:00 |
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RNS Number:0406I
Independent Media Distribution PLC
27 February 2003
INDEPENDENT MEDIA DISTRIBUTION PLC
Preliminary announcement of results for the period ended 31 December 2002
Independent Media Distribution plc ("IMD") today announces its results for the
fifteen months ended 31 December 2002. These results are announced in accordance
with the requirements of the UKLA, following IMD's reverse acquisition of Chemex
International plc ("Chemex") on 21 February 2002. Chemex's year end was 30
September but IMD, in accordance with its previous practice, is reporting with a
31 December balance sheet date. The figures quoted in this summary refer to the
year ended 31 December 2002 and comparatives to the year ended 31 December 2001.
A profit and loss account for the year ended 31 December 2002 is contained at
the end of this document.
PERFORMANCE AHEAD OF TARGETS
STRONG CURRENT TRADING
Robust profit performance for 12 Months ended 31 December 2002
* Sales increase to #2.71m, up 5%
* Headline pre-tax profit #940,000, up 12.8% with improved margins
* Headline profit after tax #681,000 (2001: #603,000)
* Increase in net cash to #2.01m (#1.35m at time of listing
in February 2002)
Increasing Rate of Growth
* Six months' sales to 31 December 2002 up 12% (First half down 1%)
* Six months' pre-tax profit to 31 December 2002 up 25% (First half
up 1%)
* Successful launch of music video service in first move into
television
* Strong response to new services in core radio business
New Year Ahead of Budget
* First eight weeks' sales increase over 20%
* Gross margins maintained
New Developments
* Progress continues for additional television industry involvement
including distribution of programming and advertising plus
extensions to music services
David Haynes, Chairman said:
"IMD's excellent results are evidence of the strength of the core business and
the depth of the company's skills in successfully expanding into new areas.
Operating and technical resources have concentrated on expanding the flexibility
and depth of services to advertising agencies, music labels and the radio
industry. This has increased the value of services offered to customers and
therefore IMD's overall importance in a key element of the media industry's
structure.
It has been IMD's objective to offer the same facilities to the television
industry and its partners. An important start has been made with music videos,
already contributing to earnings, where there has been strong uptake from all
the major record labels plus support from all elements of the television
broadcast and production industry. This opportunity has the potential to give
further impetus to sales and profit in a complementary but separate market."
Enquiries
IMD
David Haynes, Executive Chairman 0207 468 6868
david@imd.plc.uk
Bridgewell Limited
John Craven 0207 003 3000
Chairman's statement
Summary of results for the twelve months to 31 December 2002.
31/12/02 31/12/01
#'000 #'000
Turnover 2,712 2,580
Profit before taxation* 940 833
Profit after taxation* 681 603
Earnings per share (pre amortisation of goodwill) 2.03p 1.98p
Earnings per share (post amortisation of goodwill) 1.53p n/a
*before amortisation of goodwill on consolidation.
Radio Services
These comprise the delivery to radio stations on behalf of producers,
advertising agencies and studios of national advertising, syndicated
programming, new music releases and other material intended for broadcast.
Included in this activity where required, IMD provides archiving, reporting,
quality testing, royalty information for performing rights and other services
that help integrate the relationship between the radio industry and its
suppliers or customers.
Until the last few months this activity generated all IMD's revenue. It has
since the company's inception seven years ago seen rapid growth. This has been
due to enlarged market opportunities as the radio industry has increased its
penetration of media generally; there has been a substantial increase in the
number of stations and a general move toward more sophisticated programming and
advertising.
To ensure its ability to grow with these developments, IMD has consistently
invested in updating its technology together with maintaining a software and
engineering development team amounting to a third of the company's total
staffing. During the latest period, capital expenditure upgrades have included
substantial extensions to the broadband digital network, introduction of online
verification and reporting, and linear quality to overcome compression problems
at radio stations.
There has been a continuing improvement throughout the year in comparative
sales. This reflects the radio industry's better performance against other media
together with a continuing improvement in like for like sales due to the uptake
of additional IMD services introduced later in the year.
Television services
After considerable development time to create high picture quality, IMD
commenced delivery of music videos to television stations and programme makers
in July. The videos are of new releases and in VHS quality for review purposes.
After successful trials with MTV the service has now been enthusiastically
supported by both broadcasters and music labels. By October 2002, sales were
generating positive cash flow. Since then there has been continuing progress as
the network has expanded and pricing correspondingly improved.
Music video distribution was always seen as the first stage in IMD's television
services. Its success has been important in building relationships in the
industry opening the opportunity to deliver broadcast quality music. It is
believed there is also the potential to satisfy the television requirements of
IMD's existing advertising customers. Several television stations are helping
with this next phase of development and all the major record labels have pledged
they will support the upgraded version.
Balance sheet, cash generation and financial summary
The Group's financial position is strong. There are no borrowings and no long
term commitments other than property leases. Cash resources at the end of the
year exceeded #2.01m. Net cash generated from the date of the company's stock
market listing on 21 February 2002 to the end of the year was #0.66m.
Since the company's listing, sales have shown a rising momentum. In the second
half, they increased 12% and in the opening eight weeks of 2003 the increase has
been in excess of 20%. Profit margins have improved with greater productivity
and staff levels have remained steady despite the commencement of the television
video service. In the second half of 2002 operating profit was up 25%, a figure
substantially in excess of the sales increase.
IMD maintains a high level of development expenditure both to improve and
upgrade existing services and to prepare new products. To finance this
expenditure depreciation policy is to write off all hardware and fixed assets
over three years straight line and all bought in software over two years
straight line. When combined with internal development expenditure, which is
expensed as incurred, the company believes it is conservative in its asset
valuations.
Goodwill associated with the reverse acquisition of Chemex has been written off
in its entirety in the year.
Earnings per share and dividend policy
Headline earnings per share for the twelve months to 31 December 2002 were 2.03p
and earnings per share after deducting goodwill on consolidation were 1.53p
Earnings per share for the fifteen months to 31 December 2002 were, headline
2.39p and after deducting goodwill on consolidation 1.88p
The Company's strong cash generation and robust profit enables the company to
increase the final dividend. An interim dividend of 0.45p per share was paid in
November 2002 and a final dividend of 0.50p is proposed for payment on 28 May
2003 to shareholders on the register as at 25 April 2003.
Current Trading
Group Sales in the first eight weeks of 2003 are in excess of 20% above those of
2002. The sales increase reflects initial revenue from television videos
together with a pleasing increase in radio related revenue. It is particularly
gratifying to see that agencies are increasing the use of upgraded services and
therefore slightly lifting the average revenue per order.
Development expenditure continues at its previous level with a high proportion
written off against current earnings, both for continuing improvements to
existing services as well as potential new services. Even so profit margins are
being fully maintained.
David Haynes
Chairman
GROUP PROFIT AND LOSS ACCOUNT
Fifteen months to Year to
31 December 30 September
2002 2001
#'000 #'000
TURNOVER 3,311 2,597
Cost of sales and overheads, less other income (2,265) (1,807)
------------- -------------
TRADING PROFIT 1,046 790
Goodwill on consolidation written-off (168) -
-------------- -------------
OPERATING PROFIT 878 790
Interest receivable 76 53
-------------- -------------
PROFIT ON ORDINARY
ACTIVITIES BEFORE TAXATION 954 843
Tax on profit on ordinary activities (329) (205)
------------- -------------
PROFIT ON ORDINARY ACTIVITIES
AFTER TAXATION 625 638
DIVIDENDS
Ordinary dividends on equity shares (521) (155)
Special dividend on equity shares (639) -
(1,160) (155)
------------- -------------
RETAINED (LOSS)/PROFIT (535) 483
======= ======
NORMAL EARNINGS PER SHARE
BASIC 1.88p 2.14p
====== ======
DILUTED 1.85p 1.93p
====== ======
EARNINGS PER SHARE - PRIOR TO
GOODWILL WRITE-OFF
BASIC 2.39p 2.14p
====== ======
DILUTED 2.34p 1.93p
====== ======
GROUP BALANCE SHEET
As at 31 December As at 30 September
2002 2001
#'000 #'000
FIXED ASSETS
Intangible assets - 7
Tangible assets 385 475
---------- ----------
385 482
---------- ----------
CURRENT ASSETS
Debtors 660 681
Cash at bank 2,008 1,260
------------- -------------
2,668 1,941
CREDITORS: amounts falling
due within one year (627) (526)
------------- -------------
NET CURRENT ASSETS 2,041 1,415
-------------- -------------
TOTAL ASSETS LESS CURRENT LIABILITIES 2,426 1,897
PROVISION FOR LIABILITIES AND CHARGES (23) (11)
------------- -------------
NET ASSETS 2,403 1,886
====== ======
CAPITAL AND RESERVES
Called up share capital 3,352 101
Share premium account 1 404
Other reserve (1,796) -
Profit and loss account 846 1,381
------------- -------------
EQUITY SHAREHOLDERS' FUNDS 2,403 1,886
====== ======
GROUP CASH FLOW STATEMENT
Fifteen months to Year to
31 December 2002 30 September 2001
#'000 #'000 #'000 #'000
OPERATING ACTIVITIES
Operating profit 878 790
Depreciation and amortisation 536 416
Decrease/(increase) in debtors 21 (164)
(Decrease)/increase in creditors (72) 57
Goodwill write-off 168 -
-------------- ---------------
653 309
--------------- -------------
NET CASH INFLOW FROM OPERATING
ACTIVITIES 1,531 1,099
RETURNS ON INVESTMENTS AND
SERVICING OF FINANCE 76 53
TAXATION (204) (217)
CAPITAL EXPENDITURE
Purchase of intangible fixed assets - (11)
Purchase of tangible fixed assets (440) (378)
-------------- ---------------
(440) (389)
ACQUISITIONS AND DISPOSALS 785 -
(net of transaction costs)
EQUITY DIVIDEND PAID (992) (155)
---------------- ---------------
NET CASH INFLOW BEFORE MANAGEMENT OF LIQUID
RESOURCES AND FINANCING 756 391
MANAGEMENT OF LIQUID RESOURCES
Increase in monies held on 30 day notice (646) -
FINANCING
Issue of shares 99 12
--------------- -------------
CHANGE IN CASH IN THE PERIOD 209 403
======= ======
RECONCILIATION OF NET CASH FLOW TO NET FUNDS
Fifteen months to Year to
31 December 2002 30 September 2001
#'000 #'000
Change in cash in the period 209 403
Increase in liquid resources 646 -
------------- -------------
Movement in net funds in the period 855 403
Net funds at beginning of period 1,153 750
------------- -------------
Net funds at end of period 2,008 1,153
====== ======
NOTES
1. BASIS OF CONSOLIDATION
On 21 February 2002 the Company then named Chemex International PLC ("Chemex")
became the legal parent company of Independent Media Distribution PLC ("IMD") in
a share-for-share transaction. Due to the relative values of the companies, the
former IMD shareholders became the majority shareholders with 75% of the
enlarged share capital. Further, the Company's continuing operations and
executive management were those of IMD. Accordingly, the substance of the
combination was that IMD acquired Chemex in a reverse acquisition. As part of
the business combination Chemex International plc changed its name to
Independent Media Distribution plc and changed its year-end to 31 December.
Under the requirements of the Companies Act 1985 it would normally be necessary
for the Company's consolidated accounts to follow the legal form of the business
combination. In that case the pre-combination results would be those of Chemex
and its subsidiary undertakings, which would exclude IMD. IMD would then be
brought into the Group from 21 February 2002. However, this would portray the
combination as an acquisition of IMD by Chemex and would, in the opinion of the
directors, fail to give a true and fair view of the substance of the business
combination. Accordingly, the directors have adopted reverse acquisition
accounting as the basis of consolidation in order to give a true and fair view.
In invoking the true and fair override the directors note that reverse
acquisition accounting is endorsed under International Accounting Standard 22
and that the Urgent Issues Task Force of the UK's Accounting Standards Board
considered the subject and concluded that there are instances where it is right
and proper to invoke the true and fair override in such a way.
As a consequence of applying reverse acquisition accounting, the results for the
fifteen months ended 31 December 2002 comprise the results of IMD for those
fifteen months plus those of Chemex, the non-trading holding company, from 21
February 2002 to 31 December 2002. The comparative figures are those of IMD for
the year ended 30 September 2001. Goodwill amounting to #168,000 (see note 3)
arose on the difference between the fair value of Chemex share capital and the
fair value of its net assets at the reverse acquisition date. The goodwill has
been written off in the period because Chemex had no continuing business and
therefore the goodwill has no intrinsic value.
The effect on the consolidated financial statements of adopting reverse
acquisition accounting, rather than following the legal form, are widespread.
However, the following table indicates the principal effect on the composition
of the reserves.
Reverse acquisition Normal acquisition Impact of reverse
Accounting (as Accounting Acquisition accounting
disclosed)
#'000 #'000 #'000
Called up share capital 3,352 3,352 -
Share premium account 1 1 -
Merger reserve - 8,240 (8,240)
Other reserve (1,796) - (1,796)
Profit and loss account 846 87 759
-------------- -------------- --------------
2,403 11,680 (9,277)
====== ====== =======
2. ACCOUNTING POLICIES
This preliminary announcement is prepared on the basis of the accounting
policies as stated in the last annual accounts of the group's only trading
subsidiary, IMD Media Limited (formerly Independent Media Distribution PLC), and
are in accordance with the Accountants' Report on IMD contained in the listing
particulars relating to Chemex International PLC, dated 28 January 2002.
3. ACQUISITION
Reverse acquisition of Chemex International PLC ("Chemex")
On 21 February 2002 Independent Media Distribution PLC ("IMD") completed the
reverse acquisition of Chemex. The goodwill that arose on the reverse
acquisition of Chemex's share capital of 4,172,496 ordinary shares at the fair
value of the shares on that date of #0.39 less the fair value of Chemex net
assets acquired is set out in the following table:
Book and fair value of net assets acquired #'000
Cash at bank and in hand 1,623
Creditors (164)
--------------
Net assets 1,459
Cost of acquisition 1,627
--------------
Goodwill 168
======
The goodwill of #168,000 has been written off in the period because Chemex had
no continuing business and therefore the goodwill has no intrinsic value.
4. BUSINESS SEGMENT ANALYSIS
The turnover, profit on ordinary activities before taxation and net assets, all
of which occur in the United Kingdom, are attributable to one activity that of
electronic data distribution.
5. TAXATION ON PROFIT ON ORDINARY ACTIVITIES
The effective rate of corporation tax for the period ended 31 December
2002 is 34.5% (2001 24.3%) compared to an actual corporation tax rate for
the period of 30% (2001 30%). The difference is principally due to the
goodwill written-off being disallowable and the adjustments to the tax
charge in respect of previous periods.
6. DIVIDENDS TO EQUITY SHAREHOLDERS Fifteen months to Year to
31 December 2002 30 September 2001
#'000 #'000
Interim dividends paid 353 67
Special dividend paid 639 -
Final dividend paid - 88
Final dividend proposed 168 -
-------------- ------------
1,160 155
====== ======
7. EARNINGS PER SHARE
Basic earnings per share is calculated by reference to the profit on ordinary
activities after taxation of #625,000 (2001: #638,000) and on the weighted
average of 33,218,726 (2001: 29,795,964) shares in issue.
The calculation of diluted earnings per share is based on the profit on ordinary
activities after taxation and the diluted weighted average of 33,835,804 (2001:
32,062,217) shares calculated as follows:
Number of shares
Fifteen months to Year to
31 December 2002 30 September 2001
Basic weighted average number of shares 33,218,726 29,795,964
Dilutive potential ordinary shares:
Share options 617,078 2,266,253
--------------------- ---------------------
Diluted weighted average number of shares 33,835,804 32,062,217
========== ==========
An adjusted earnings per share calculation based on the results before the
write-off of goodwill is set out below to facilitate comparison of the
underlying performance of the group.
Fifteen months to Year to
31 December 2002 30 September 2001
Basic Diluted Basic Diluted
Basic earnings per share 1.88p 1.85p 2.14p 1.93p
Goodwill write off 0.51p 0.49p - -
------------- ------------- ------------ -------------
Adjusted earnings per share 2.39p 2.34p 2.14p 1.93p
====== ====== ====== ======
8. SHARE CAPITAL
Nos. of Allotted, called
up
Shares and fully paid
This comprises ordinary shares as follows: #'000
At 1 October 2001 41,724,960 417
Share consolidation (37,552,464) -
Shares issued during the period 29,349,389 2,935
----------------------- ---------------
At 31 December 2002 33,521,885 3,352
=========== =======
On 20 February 2002 the shares were consolidated on the basis of 1 New Ordinary
Share for every 10 Existing Ordinary Shares.
On 21 February 2002 29,146,719 shares of 10 pence each were issued in respect of
the reverse acquisition of Independent Media Distribution PLC with a nominal
value of #2,914,672.
Since 21 February 2002 a further 202,670 share options have been exercised at a
nominal value of #20,267.
The share capital in the group balance sheet at 30 September 2001 reflects that
of Independent Media Distribution PLC prior to the reverse acquisition.
The share premium has been used to absorb the costs of the transaction of
#692,000 along with the other reserve. The debit on the other reserve has arisen
because the nominal value of the consideration shares issued by Chemex to IMD
shareholders, referred to above, plus the costs of the transaction were in
excess of the book value of IMD's net assets at the date of the transaction.
RECONCILIATION OF THE HEADLINE RESULTS TO THE STATUTORY RESULTS
Headline results Statutory Results
12 months ended 3 months ended 15 months ended
31 December 2002 31 December 2001 Goodwill 31 December 2002
#'000 #'000 #'000 #'000
TURNOVER 2,712 599 3,311
Cost of sales and overheads, less other 1,834 431 2,265
income
------------- ------------- -------------
TRADING PROFIT 878 168 1,046
Goodwill on consolidation written-off - - (168) (168)
------------- ------------- -------------
OPERATING PROFIT 878 168 878
Interest receivable 62 14 76
------------- ------------- -------------
PROFIT ON ORDINARY ACTIVITIES BEFORE 940 182 954
TAXATION
Tax on profit on ordinary activities (259) (70) (329)
------------- ------------- -------------
PROFIT ON ORDINARY ACTIVITIES AFTER TAXATION 681 112 625
DIVIDENDS (318) (842) (1,160)
------------- ------------- -------------
RETAINED PROFIT/(LOSS) 363 (730) (535)
====== ====== ======
IMD MEDIA LIMITED
PROFIT AND LOSS ACCOUNT
YEAR ENDED 31ST DECEMBER 2002
Year ended Year ended
31 December 31 December
2002 2001
#'000 #'000
TURNOVER 2,712 2,580
Cost of sales (240) (292)
--------------------- --------------------
GROSS PROFIT 2,472 2,288
Administrative expenses (1,594) (1,511)
------------------- -------------------
OPERATING PROFIT 878 778
Net interest received 62 55
------------------- -------------------
PROFIT ON ORDINARY
ACTIVITIES BEFORE TAXATION 940 833
Tax on profit on ordinary activities (260) (230)
----------------- -----------------
PROFIT ON ORDINARY ACTIVITIES
AFTER TAXATION 680 603
DIVIDENDS
Ordinary dividend on equity shares (318) (202)
Special dividend on equity shares - (639)
(318) (841)
----------------- -----------------
RETAINED PROFIT/(LOSS) FOR THE YEAR 362 (238)
========= ========
This information is provided by RNS
The company news service from the London Stock Exchange
END
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