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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Jaywing Plc | LSE:JWNG | London | Ordinary Share | GB00BF5KDY46 | ORD 5P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 3.15 | 3.10 | 3.20 | 3.15 | 3.15 | 3.15 | 0.00 | 08:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Advertising, Nec | 22.57M | -12.83M | -0.1373 | -0.23 | 2.94M |
From Apr 2022 to Apr 2024
TIDMJWNG
RNS Number : 1689I
Jaywing PLC
01 December 2022
The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.
Jaywing plc
Interim Results September 2022
Jaywing plc (AIM: JWNG), the integrated agency powered by data science, today announces its interim results for the six months ended 30 September 2022 ("H1").
Financial highlights
Hot Features
Premium
6 months 6 months
to to
30 September 30 September
2022 2021 Change
GBP'000 GBP'000 %
-------------- -------------- -------
Revenue 11,161 11,606 (3.8%)
-------------- -------------- -------
Loss after tax for the
period (208) (289)
-------------- -------------- -------
Adjusted EBITDA(1) 1,360 1,026 32.6%
-------------- -------------- -------
Cash Generated from Operations (134) 681
-------------- --------------
Net Debt (excluding IFRS
16) (2) (10,068) (8,138)
-------------- --------------
Reconciliation of Operating Profit with Adjusted EBITDA
6 months 6 months
to to
30 September 30 September
2022 2021
GBP'000 GBP'000
Operating Profit 580 205
-------------- ---------------------------
Add Back:
-------------- ---------------------------
Depreciation 117 140
-------------- ---------------------------
Depreciation of right
of use assets 310 333
-------------- ---------------------------
Amortisation of intangibles 30 348
-------------- ---------------------------
EBITDA 1,037 1,026
-------------- ---------------------------
Restructuring charges 131 -
-------------- ---------------------------
Acquisition & related 192 -
costs
-------------- ---------------------------
Adjusted EBITDA(1) 1,360 1,026
-------------- ---------------------------
Adjusted EBITDA margin 12.2% 8.8%
-------------- ---------------------------
6 months to 6 months to
30 September 30 September
2022 2021 Change
GBP'000 GBP'000 %
Revenue
------------- ------------- -------
United Kingdom 8,426 8,956 (5.9%)
------------- ------------- -------
Australia 2,735 2,650 3.2%
------------- ------------- -------
Group total 11,161 11,606 (3.8%)
------------- ------------- -------
Adjusted EBITDA(1)
------------- ------------- -------
United Kingdom 1,219 486 150.8%
------------- ------------- -------
Australia 141 540 (73.9%)
------------- ------------- -------
Group total 1,360 1,026 32.6%
------------- ------------- -------
(1) Adjusted EBITDA represents EBITDA before restructuring charges arising from actions taken in Q4 of the year ended 31 March 2022, and acquisition & related costs
(2) Including accrued interest
Operational Highlights
-- Adjusted EBITDA up by 32.6% at GBP1,360k against prior period, on 3.8% lower revenues
-- UK profitability improved with adjusted EBITDA up 150.8% at GBP1,219k, due to cost and efficiency improvements
-- Australian adjusted EBITDA down 73.9% at GBP141k as a result of Australian wage inflation and impact of integration activity at the start of FY23
-- New business pipeline remains strong
-- Decision IP acquisition successfully completed & encouraging new business growth opportunities for Decision software being developed.
Commenting on the results, Andrew Fryatt, CEO of Jaywing plc, said :
I am pleased to report that we delivered an improvement in underlying profitability in the first half year with adjusted EBITDA up GBP334k to GBP1,360k against prior period. Adjusted EBITDA margin improved by 3.4ppt to 12.2%, driven by our strong proposition in the market together with a firm control on costs. This has been delivered against a challenging backdrop. The economic uncertainty in both the UK and Australia impacted first half revenues, with some existing clients delaying spend and onboarding of new clients taking longer to navigate clients' internal approvals. UK revenues were 5.9% lower, but our actions to reduce the cost base at the end of the prior year resulted in UK adjusted EBITDA being 150.8% higher, at GBP1,219k. In Australia, revenues were up 3.2%, although the momentum from the previous financial year, which achieved a revenue growth of 24.5%, was interrupted by the integration of the two Australian businesses. Coupled with local wage inflation as a result of the previous border closure, Australia's EBITDA fell back in the period, to GBP141k.The group returned to pre-tax profit, recording a profit before tax of GBP208k.
UK
In the UK, we added a number of new clients in the first half, including Verdant Leisure, Fair4All Finance, OpenMoney, University of East Anglia and Truworths. The opportunity pipeline remains strong, and we continue to win at least half the opportunities we pitch for.
However, the impact of economic uncertainty and the war in Ukraine can be seen in existing spend levels, with some clients deferring expenditures into the second half or until they have more certainty of their own revenues. We are managing the UK cost base accordingly to help us to continue to increase profitability year-on-year despite softer revenues, and UK revenue per head was up 2.9% in the first half.
The UK's top ten clients accounted for 35.0% of UK revenue, or GBP3.0m, and their aggregate spend was up 17.3% on the previous year. Key clients included Castrol, HSBC and ADT, who have all increased their spend this year. Our Retail client revenues were up 19.0% in the first half, but this was offset by more cautious expenditure by our Financial and FMCG clients.
Australia
In Australia, the integration of the two original businesses (Massive Group Pty and Frank Digital Pty) into "Jaywing Australia", during last year's Q4, resulted in a reduced pipeline of new business at the start of the current financial year. However, the restructuring of our Australian business will now support increased scale, and we are now able to present a strong integrated proposition. This is already resulting in an increased opportunity pipeline which includes a number of potential blue-chip clients.
The key issue over the last year or so has been wage inflation in Australia, following the two-year closure of the borders during the pandemic. On a comparable basis, average cost per employee is up 26.2% on the prior year. With the opening of the borders, this wage inflation has abated, and the second half of the year is expected to produce a stronger revenue and profit performance.
Strategy
During the first half we were also able to resolve a number of legacy issues, including the long-running litigation in relation to the Bloom acquisition in 2016 with the claimants' case being dismissed in April 2022 and completion of the final payments for the Frank Digital Put Option in Australia.
Towards the end of the first half we completed the acquisition of Midisi Ltd, who own the IP for the Decision automation software Jaywing has used since 2016. This has immediately increased profitability through removal of the licence fee and allowed us to increase our commercial focus on Decision and its benefits in increasing the effectiveness of marketing spend. This is resonating well with clients, and we have already added four new Decision clients with several additional opportunities in the pipeline.
Net Debt and Cash Flow
Partly in anticipation of the purchase of Midisi Ltd, and to provide further working capital, the Group has increased the headroom in its existing short-term finance facility by GBP1.0m, through a variation of the existing debt agreement with its lenders, DSC Investment Holdings Ltd and 1798 Volantis Fund Ltd. This was the largest driver for the increase in net debt to GBP10.1m.
There have been a number of one off cash items that have resulted in cash generated from operations dropping by GBP0.8m to GBP(0.1m). This is primarily legal costs for the Bloom litigation, payment of acquisition related costs, timing of media spend and costs relating to the new Leeds office (with a reduced cost going forward).
Working capital continues to be closely managed with debtors days for the group dropping from 64 days for the prior interim period, to 49 days.
People
Just after the end of the period we moved our Leeds employees into our new office at Globe Point - whilst our employees are working in a hybrid model resulting in a reduced footprint and lower costs, we are beginning to see a move towards a greater in-office component.
Outlook
Given the continuing uncertainty in both our domestic markets and the global economy, we remain cautious about the outlook. Nonetheless, the actions taken to optimise our cost base, coupled with a strong new business pipeline in the UK and Australia and an expected strong recovery in Australia, are expected to underpin stronger profitability in the second half.
Enquiries :
Jaywing plc Christopher Hughes (CFO/Company Tel: 0333 370 6500 Secretary) Cenkos Securities plc Nicholas Wells / Callum Davidson Tel: 020 7397 8920
Consolidated statement of comprehensive income
Unaudited Unaudited Audited
Six months Six months year ended
ended ended 31 March
30 Sept 30 Sept 2021 2022
2022
Note GBP'000 GBP'000 GBP'000
Gross revenue 14,710 15,065 30,168
Direct costs (3,549) (3,459) (6,844)
----------------- ------------------ ------------
Revenue 4 11,161 11,606 23,324
Other operating income 5 423 40 40
Operating expenses (11,004) (11,441) (29,450)
----------------- ------------------ ------------
Operating Profit /
(loss) 580 205 (6,086)
Finance costs (372 ) (249 ) (474)
Profit / (loss) before
tax 208 (44) (6,560)
Tax (charge) / credit (416) (245) 123
----------------- ------------------ ------------
Loss after tax for
the period (208) (289) (6,437)
Loss for the period
is attributable to:
Non-controlling interests - 14 12
Owners of the parent (208 ) (303 ) (6,449)
----------------- ------------------ ------------
(208) (289) (6,437)
Other comprehensive
income
Items that will be
reclassified subsequently
to profit or loss
Exchange differences
on retranslation of
foreign operations (68) 60 279
----------------- ------------------ ------------
Total comprehensive
loss for the period (276 ) (229 ) (6,158)
----------------- ------------------ ------------
Total comprehensive
loss is attributable
to:
Non-controlling interests - 14 12
Owners of the parent (276) (243 ) (6,170)
----------------- ------------------ ------------
(276) (229) (6,158)
----------------- ------------------ ------------
Loss per share 6
Basic loss per share (0.22p) (0.26p) (6.90p)
Diluted loss per share (0.22p) (0.26p) (6.90p)
Consolidated balance sheet
Unaudited Unaudited Audited
30 Sept 30 Sept 31 March
2022 2021 2022
GBP'000 GBP'000 GBP'000
Assets
Non-current assets
Property, plant and equipment 7 4,010 1,701 2,173
Goodwill 21,705 29,789 21,705
Deferred tax asset 557 - 644
Other intangible assets 8 3,331 456 69
----------------- ------------------ -----------
29,603 31,946 24,591
----------------- ------------------ -----------
Current assets
Trade and other receivables 5,246 6,550 6,415
Contract assets 887 1,180 453
Current tax asset - 329 32
Cash and cash equivalents 490 402 714
6,623 8,461 7,614
----------------- ------------------ -----------
Total assets 36,226 40,407 32,205
----------------- ------------------ -----------
Liabilities
Current liabilities
Borrowings 9 10,558 8,540 8,754
Trade and other payables 6,297 7,664 7,305
Deferred and contingent
consideration 542 794 626
Contract liabilities 788 1,046 1,408
Lease liabilities 486 353 395
Tax liabilities 25 161 -
Provisions - 42 42
----------------- ------------------ -----------
18,696 18,600 18,530
----------------- ------------------ -----------
Non-current liabilities
Lease liabilities 3,206 731 1,448
Deferred tax liabilities - 56 -
Deferred and contingent 2,373 - -
consideration
5,579 787 1,448
----------------- ------------------ -----------
Total liabilities 24,275 19,387 19,978
----------------- ------------------ -----------
Net assets 11,951 21,020 12,227
----------------- ------------------ -----------
Equity
Capital and reserves attributable
to equity holders of the
company
Share capital 10 34,992 34,992 34,992
Share premium 10,088 10,088 10,088
Capital redemption reserve 125 125 125
Shares purchased for treasury (25) (25) (25)
Foreign currency translation
reserve 50 (101) 118
Retained earnings (33,279) (24,427) (33,071)
----------------- ------------------ -----------
Equity attributable to
owners of the parent 11,951 20,652 12,227
Non-controlling interest - 368 -
Total equity 11,951 21,020 12,227
----------------- ------------------ -----------
Consolidated cash flow statement
Unaudited Unaudited Audited
Six months Six months year ended
ended ended 31 March
30 Sept 30 Sept 2021 2022
2022
GBP'000 GBP'000 GBP'000
Cash flow from operating activities
Loss after tax for the period (208) (289) (6,437)
Adjustment for:
Impairment of goodwill - - 6,131
Depreciation of property, plant,
and equipment 117 140 327
Depreciation and impairment
of right of use assets 310 333 752
Amortisation of intangibles 30 348 730
Financial costs 372 249 474
Taxation expense/(credit) 416 245 (123)
------------ -------------- ------------
Operating cash flow before
changes in working capital 1,037 1,026 1,854
Operating cash flow before
changes in working capital
Decrease/(Increase) in trade
and other receivables 735 (990) (168)
(Decrease)/Increase in trade
and other payables (1,906) 645 (99)
Cash generated from operations (134) 681 1,587
Interest paid (15) (27) (58)
Tax paid (44) (98) (240)
------------ -------------- ------------
Net cash flow from operating
activities (193) 556 1,289
Cash flows from investing activities
Payment of deferred consideration (668) (442) (442)
Increase in borrowings 1,500 - -
Acquisition of subsidiary (note (400) - -
12)
Acquisition of intangible assets - (4) -
Acquisition of property, plant,
and equipment (150) (115) (163)
------------ -------------- ------------
Net cash outflow from investing
activities 282 (561) (605)
------------ -------------- ------------
Cash flows from financing activities
Repayment of Lease Liabilities
(IFRS 16) (313) (345) (722)
Net cash outflow from financing
activities (313) (345) (722)
Net decrease in cash, cash
equivalents and bank overdrafts (224) (350) (38)
Cash and cash equivalents at
beginning of period 714 752 752
------------ -------------- ------------
Cash and cash equivalents at
end of period 490 402 714
------------ -------------- ------------
Cash and cash equivalents comprise:
Cash at bank and in hand 490 402 714
------------ -------------- ------------
Consolidated statement of changes in equity
Share Share Capital Treasury Foreign Retained Equity Non-controlling Total
capital premium redemption Shares currency earnings attributable interest equity
account reserve translation to parent
reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------- -------- ----------- --------- ------------ ---------- ------------- ---------------- --------
Balance at 31
March 2021 34,992 10,088 125 (25) (161) (24,124) 20,895 354 21,249
(audited)
-------- -------- ----------- --------- ------------ ---------- ------------- ---------------- --------
Prior year
adjustment
(audited) - - - - - (2,208) (2,208) - (2,208)
Restated
balance
at 31 March
2021
(audited) 34,992 10,088 125 (25) (161) (26,332) 18,687 354 19,041
Acquisition of
subsidiaries
NCI - - - - - (290) (290) (366) (656)
-------- -------- ----------- --------- ------------ ---------- ------------- ---------------- --------
Transactions
with
owners - - - - - (290) (290) (366) (656)
Loss for the
period - - - - - (6,449) (6,449) 12 (6,437)
Retranslation
of
foreign
currency - - - - 279 - 279 - 279
-------- -------- ----------- --------- ------------ ---------- ------------- ---------------- --------
Total
comprehensive
income for the
period - - - - 279 (6,739) (6,460) (354) (6,814)
-------- -------- ----------- --------- ------------ ---------- ------------- ---------------- --------
Balance at 31
March 2022
(audited) 34,992 10,088 125 (25) 118 (33,071) 12,227 - 12,227
-------- -------- ----------- --------- ------------ ---------- ------------- ---------------- --------
Loss for the
period - - - - - (208) (208) - (208)
Retranslation
of
foreign
currency - - - - (68) - (68) - (68)
-------- -------- ----------- --------- ------------ ---------- ------------- ---------------- --------
Total
comprehensive
income for the
period - - - - (68) (208) (276) - (276)
-------- -------- ----------- --------- ------------ ---------- ------------- ---------------- --------
Balance at 30
September 2022
(unaudited) 34,992 10,088 125 (25) 50 (33,279) 11,951 - 11,951
-------- -------- ----------- --------- ------------ ---------- ------------- ---------------- --------
1. General Information
Jaywing plc (the "Company") is incorporated and domiciled in the United Kingdom. The Company is listed on the AIM market of the London Stock Exchange. The registered address is Albert Works, Sidney Street, Sheffield,
S1 4RG.
The interim financial information was approved for issue on 30 November 2022.
2. Basis of preparation
The consolidated interim financial statements for the six months ended 30 September 2022, which are unaudited, have been prepared in accordance with applicable accounting standards and under the historical cost convention except for certain financial instruments that are carried at fair value.
The financial information for the year ended 31 March 2022 set out in this interim report does not constitute statutory accounts as defined in Section 434 of the Companies Act 2006. The Group's statutory financial statements for the year ended 31 March 2022 have been filed with the Registrar of Companies. The auditor's report on those financial statements was unqualified and did not contain statements under Section 498 (2) or Section 498 (3) of the Companies Act 2006.
The consolidated interim financial information should be read in conjunction with the annual financial statements for the year ended 31 March 2022, which have been p repared and approved by the Directors in accordance with International accounting standards in conformity with the Companies Act 2006. The Consolidated Financial Statements have been prepared under the historical cost convention.
The Board continually assesses and monitors the key risks of the business. The Board continues to consider the Group's profit and cash flow plans for at least the next 12 months and runs forecasts and downside stress test scenarios. These risks have not significantly changed from those set out in the Company's Annual Report for the period ended 31 March 2022.
Based on the Group's cash flow forecasts and projections, the Directors are satisfied that the Group has adequate resources to continue in operational existence for the foreseeable future. In considering their position the Directors have also had regard to letters of support in respect of the secured debt received from each of the holders of that debt. The Group has continued to adopt the going concern basis of accounting in preparing these interim financial statements.
3. Accounting policies
The principal accounting policies of Jaywing plc and its subsidiaries ("the Group") are consistent with those set out in the Group's 2022 annual report and financial statements other than the new policies included below.
There were no new relevant Standards or Interpretations to be adopted for the six months ended 30 September 2022.
Taxes on income in the interim periods are accrued using the tax rate that would be applicable to expected total annual earnings.
3.1 Business combinations
The Group applies the acquisition method in accounting for business combinations. The consideration transferred by the Group to obtain control of a subsidiary is calculated as the sum of the acquisition-date fair values of assets transferred, liabilities incurred and the equity interests issued by the Group, which includes the fair value of any asset or liability arising from a contingent consideration arrangement. Acquisition costs are expensed as incurred.
Assets acquired and liabilities assumed are measured at their acquisition-date fair values.
The fair value amounts included in the interim results are provisional and will be reassessed in line with the measurement period applicable under IFRS 3
3.2 Other Intangible assets
Initial recognition of other intangible assets
Intellectual property
Intellectual property acquired in a business combination that qualifies for separate recognition are recognised as intangible assets at their fair values.
Subsequent measurement
Amortisation is charged to profit or loss on a straight-line basis over the estimated useful lives of intangible assets unless such lives are indefinite. Other intangible assets are amortised from the date they are available for use.
The estimated useful life for intellectual property is 5 years.
3.3 Accounting estimates
Management uses valuation techniques when determining the fair values of certain assets and liabilities acquired in a business combination (see Note 3.1). In particular, the fair value of contingent consideration is dependent on the outcome of the acquirees' future revenues (see Note 12).
4. Segment information
The Group reported its operations based on location of business (United Kingdom & Australia).
Group revenue and Adjusted EBITDA by operating segments
Unaudited Unaudited
six months six months
ended 30 ended
Sept 2022 30 Sept 2021
GBP'000 GBP'000
Revenue
United Kingdom 8,426 8,956
Australia 2,735 2,650
----------- -------------
11,161 11,606
----------- -------------
Adjusted EBITDA
United Kingdom 1,219 486
Australia 141 540
----- -----
1,360 1,026
----- -----
Revenue is defined as revenue less third-party direct costs of sale. Gross revenue before third- party direct costs in the UK was GBP11,949k (2021: GBP12,366k), and in Australia GBP2,761k (2021: GBP2,699k).
Group revenue by client facing segments
Analysis is presented on client facing sector to aid in understanding performance.
Unaudited Unaudited
six months six months
ended 30 ended
Sept 2022 30 Sept 2021
GBP'000 GBP'000
Retail 4,837 4,012
FMCG 2,984 3,057
Financial & Professional Services 3,340 4,537
--------------- ---------------
11,161 11,606
--------------- ---------------
"Retail" includes: Retail, Travel & Leisure, Hospitality, Property & Utilities
"FMCG" includes: Consumer Goods, Industrial, Telecoms, Support Services, Healthcare, Education, Public Sector & Non-Profit
"Financial & Professional Services " includes: Financial & Professional Services 5. Other operating income (unaudited)
Within other operating income this period is a settlement of GBP419k in relation to previously incurred legal costs following the dismissal of the claimants case in April 2022, associated with the 2016 acquisition of Bloom Media (UK) Limited. The remaining GBP4k relates to sundry income.
The Group has taken the option to present income received from Government sources in relation to Covid-19 as other operating income, rather than netted against costs. In the period to September 2021 the Group received funds from the UK Government under the Covid-19 Job Retention Scheme of GBP37k, and GBP3k under the corresponding scheme in Australia, Cashflow boost and Job Keepers. There were no receipts of support after September 2021.
6. Loss per share
Unaudited Unaudited Audited
Six months Six months year
ended ended ended
30 Sept 30 Sept 31 March
2022 2021 2022
Pence Pence per Pence per
per share share Share
Basic loss per share (0.22p) (0.26p) (6.90p)
Diluted loss per share (0.22p) (0.26p) (6.90p)
7. Property, plant and equipment
Unaudited Unaudited Audited
30 Sept 30 Sept 31 March
2022 2021 2022
GBP'000 GBP'000 GBP'000
Buildings 3,462 1,136 1,660
Leasehold improvements 216 224 211
Office equipment 332 341 302
---------- ---------- ----------
4,010 1,701 2,173
---------- ---------- ----------
8. Other intangible assets
Unaudited Unaudited Audited
30 Sept 30 Sept 31 March
2022 2021 2022
GBP'000 GBP'000 GBP'000
Customer relationships - 296 -
Development costs 39 160 69
Intellectual property (note 3,292 - -
12)
---------- ---------- ----------
3,331 456 69
---------- ---------- ----------
9. Borrowings
Unaudited Unaudited Audited
30 Sept 30 Sept 31 March
2022 2021 2022
Summary GBP'000 GBP'000 GBP'000
Borrowings 10,558 8,540 8,754
---------- ---------- ----------
10,558 8,540 8,754
---------- ---------- ----------
Borrowings are repayable
as follows:
Within 1 year
Borrowings 10,558 8,540 8,754
---------- ---------- ----------
Total due within 1 year 10,558 8,540 8,754
In more than one year but - - -
less than two years
Total amount due 10,558 8,540 8,754
---------- ---------- ----------
Average interest rates at % % %
the balance sheet date were:
Term loan 5.60 4.81 4.75
As the loans are at variable market rates their carrying amount is equivalent to their fair value.
The borrowings are repayable on demand and interest is calculated at 3-month LIBOR plus a margin. Borrowings includes accrued interest.
The borrowings are secured by charges over all the assets of Jaywing and guarantees and charges over all the assets of the various subsidiaries (Jaywing UK Limited, Alphanumeric Limited, Gasbox Limited, Jaywing Central Limited, Jaywing Innovation limited, Bloom Media (UK) Limited and Epiphany Solutions Limited).
Cash and
Reconciliation of net debt cash equivalents Borrowings Net debt
GBP'000 GBP'000 GBP'000
30 September 2022 (Unaudited) 490 (10,558) (10,068)
31 March 2022 (Audited) 714 (8,754) (8,040)
30 September 2021 (Unaudited) 402 (8,540) (8,138)
------------------ ----------- ---------
10. Share capital (unaudited)
Allotted, issued and fully paid
45p deferred 5p ordinary
shares shares
Number Number GBP'000
Issued share capital at 31
March 2022 and 30 September
2022 and 30 September 2021 67,378,520 93,432,217 34,992
--------------- -------------- ----------
11. Related party transactions (unaudited)
There were no other significant changes in the nature and size of related party transactions for the period from those disclosed in the Annual Report for the year ended 31 March 2022.
12. Provisional business combination (unaudited)
On 26 August 2022 the group purchased 100% of the ordinary share capital of Midisi Limited for consideration of GBP3.3m.
The provisional amounts below recognised in respect of the identifiable assets and liabilities acquired are as set out in the table below:
Provisional
fair value
on acquisition
GBP'000
Assets
Intangible assets (note 8) 3,292
---------------------------
3,292
---------------------------
Liabilities
Accruals (3)
Social security and other taxes (23)
---------------------------
(26)
---------------------------
Total identifiable net assets at fair value 3,266
---------------------------
Purchase consideration
Satisfied by:
Cash 400
Deferred consideration 1,307
Contingent consideration 1,559
---------------------------
Total consideration 3,266
---------------------------
The initial consideration for the acquisition was GBP0.4m which was paid from Jaywing's existing cash resources. Further fixed payments totalling GBP1.4m will be paid at 6-monthly intervals over 42 months, plus an additional performance-related earn-out payable at 6-monthly intervals between months 13 and 49. The earn-out relates to revenues generated from Midisi, and the maximum earn-out payment is capped at GBP3.2m. Following the acquisition, the incremental revenue contributions delivered by Midisi are estimated to be at least GBP5.7m over 42 months, based on planned growth in the client base and enhancements to other existing Jaywing services. This would generate earn-out payments totalling GBP1.7m. The figures included in the table above are recorded at present value.
13. Post balance sheet event (unaudited)
There are no post balance sheet events that require disclosure.
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