RNS Number:5464M
asSeenonScreen Holdings PLC
19 June 2003
AS SEEN ON SCREEN HOLDINGS PLC
("the Group")
Preliminary Results
for the year ended 31 December 2002
CHIEF EXECUTIVE'S STATEMENT
imie I am pleased to report on the Group's second full year trading figures
covering the 12 months ending 31 December 2002.
Headlines
*Revenues - up 141% to #4.1m
*EBITDA loss - down from 802k in 2001 to #48k in 2002
*MBO talks stopped
*Sale of trading subsidiary Entertainment Marketing underway
*AsSeenonScreen Holdings plc to be re-named ASOS plc
*Accounting year end to be changed from 31 December to 31 March
*Trading up-date - January to May 2003 Group revenues up 135%
*Strong growth expected throughout 2003
asSeenonScreen Holdings plc
Group revenues rose sharply to #4.1m, up from #1.7m in 2001 and Group losses
were reduced (on an EBITDA basis) from #802k in 2001 to #48k in 2002. This is a
very positive performance and highlights the Board's ability to combine strong
revenue growth with rigorous cost management.
The Group operating loss for the period of #1.7m (up from #1.1m in 2001)
includes a #1.4m goodwill write off from the Group's acquisition of the cash
shell 'Brindle Ltd' in 2001.
The Group can report that exploratory conversations were held with key
management in April 2003 regarding a possible management buyout. I can confirm
that these discussions have terminated. The Board believes that there are
opportunities within the Internet Retail sector for consolidation and, given
that the Group's ordinary shares are admitted to trading on AIM, the Group
intends to explore an acquisition strategy to accelerate the Group's growth.
At the time of writing, the Board are exploring the sale of Entertainment
Marketing, the Group's product placement business. Entertainment Marketing's
growth has been limited due to reduced management time and the ongoing
advertising recession. The Board has decided that the proceeds from a sale of
Entertainment Marketing would enhance the cash position and assist with the
stock requirements of the much faster growing asSeenonScreen.com Ltd ("ASOS").
The Board has proposed that the Group's name 'asSeenonScreen Holdings plc' be
changed to ASOS plc to mirror the re-branding of the Group's main trading
subsidiary ASOS.
In addition, following consultation with our auditors, it has been proposed that
the Group's accounting period be changed to year end 31 March as opposed to year
end 31 December. This is to enable more accurate forecasting and to assist in
the preparation of the Group's accounts in view of stock take requirements at
the year end.
I remain very confident about the Group's growth and profit potential. The
logistical and technical infrastructure is now in place to accommodate growth
and significant efficiencies have been achieved within the cost base to drive
profitability levels.
asSeenonScreen.com Ltd - ASOS
ASOS is the major contributor to the Group's performance and saw sales rise 214%
in the year to December 2002. This has continued into 2003 with revenues up 182%
(January - May).
A leading Internet fashion brand in the UK, ASOS has built a strong reputation
for range, price and quality of service - constantly out-performing better known
high-street rivals in Internet traffic terms.
According to the independent Internet survey 'Hitwise' - ASOS is a top 5 UK
Internet Clothing and Apparel store, achieving consistently higher traffic than
its nearest off-line competitor Top Shop.
The challenge facing the board is to sustain the historical growth levels and to
drive profit via increased operational efficiencies.
Since my last report, the technology platform has been overhauled enabling us to
handle ever-increasing levels of traffic and orders. The move to a bigger
warehouse in February 2003 has significantly increased the efficiencies of the
logistical operation enabling us to handle higher volumes of orders whilst
improving our high standards of customer care. The product range has been
expanded beyond fashion to incorporate more 'lifestyle' products suited to our
core 16-24 year old audience. We have also invested heavily in Magazine
advertising to promote individual products and to build awareness of the ASOS
brand.
Over the course of the year, the board has considered a number of sales channel
extensions such as Catalogues, TV infomercials and ultimately ASOS stores. It is
the Board's opinion that, for the foreseeable future, the most efficient sales
channel remains the Internet.
Entertainment Marketing UK Ltd (EM)
Against tough market conditions, and on slightly reduced revenues, EM managed to
increase its PBT to #150k in 2002 from #118k in 2001. This was a strong
performance in what has proved to a very tough climate for the whole advertising
sector.
Notable client wins in 2002 included News International and Gallo Wines and,
this year, British Gas and Samsung.
With Entertainment Marketing representing a decreasing percentage of Group
turnover (14% in 2002 and forecast 8% in 2003) the Board has decided to put
Entertainment Marketing up for sale and has approached two large advertising
groups.
AS SEEN ON SCREEN HOLDINGS PLC
Consolidated Profit And Loss Account
Year Ended 31 DECEMBER 2002
Notes 2002 2001
# # #
TURNOVER 2 4,104,123 1,702,388
Cost of sales (1,941,355) (704,915)
GROSS PROFIT 2,162,768 997,473
Distribution costs 61,085 37,279
-------- --------
Administration 2,435,157 2,075,494
expenses - other
Administration 3a 1,371,615 -
expenses - goodwill -------- --------
write off
Total administration 3,806,772 2,075,494
expenses
OPERATING LOSS (1,705,089) (1,115,300)
Interest receivable 4,197 3,412
Interest payable 4 (140) (2,377)
LOSS ON ORDINARY
ACTIVITIES
BEFORE TAXATION 3 (1,701,032) (1,114,265)
Tax on loss on 6 - -
ordinary activities
LOSS ON ORDINARY
ACTIVITIES AFTER
TAXATION (1,701,032) (1,114,265)
EARNINGS PER SHARE
Basic and fully 19 (2.8p) (2.6p)
diluted
The profit and loss account includes all recognised gains and losses in the
current and preceding year. All activities were derived from continuing
operations.
AS SEEN ON SCREEN HOLDINGS PLC
Consolidated Balance Sheet
AT 31 DECEMBER 2002
2002 2001
# # #
FIXED ASSETS
Intangible assets 1,762,234 3,362,182
Tangible assets 70,576 99,427
1,832,810 3,461,609
CURRENT ASSETS
Stocks 622,214 165,842
Debtors falling due within one 713,055 245,630
year
Cash at bank and in hand 67 116,198
1,335,336 527,670
CREDITORS: amounts falling due
within
one year (1,330,758) (450,859)
NET CURRENT ASSETS 4,578 76,811
TOTAL ASSETS LESS CURRENT
LIABILITIES 1,837,388 3,538,420
CAPITAL AND RESERVES
Called up share capital 2,157,042 2,157,042
Share premium account 2,982,025 2,982,025
Profit and loss account (3,301,679) (1,600,647)
SHAREHOLDERS' FUNDS (ALL 1,837,388 3,538,420
EQUITY)
AS SEEN ON SCREEN HOLDINGS PLC
Consolidated Cash Flow Statement
FOR THE Year Ended 31 DECEMBER 2002
2002 2001
# # #
Net cash outflow from operating (215,029) (811,028)
activities
Returns on investments and
servicing of finance
Interest received 4,197 3,412
Interest paid (140) (2,377)
Net cash flow from returns on
investments and
servicing of finance 4,057 1,035
Investing activities
Payments to acquire tangible fixed (27,744) (26,430)
assets
Cash acquired on the acquisition of - 359,698
subsidiary
Net cash (outflow)/inflow from
investing
Activities (27,744) 333,268
NET CASH OUTFLOW BEFORE FINANCING (238,716) (476,725)
Financing
Issue of loan stock - 456,300
Net inflow from issue of ordinary - 71,284
shares
Repayment of short term loan (49,000) -
Net cash (outflow)/inflow from (49,000) 527,584
financing
(DECREASE)/INCREASE IN CASH AND
CASH
EQUIVALENTS (287,716) 50,859
RECONCILIATION OF NET CASH FLOW
TO
MOVEMENT IN NET DEBT
(Decrease)/increase in cash for the (287,716) 50,859
year
Cash inflow/(outflow) from increase 49,000 (456,300)
in debt
Change in net debt resulting from (238,716) (405,441)
cashflows
Ordinary share capital issued as - 2,301,300
settlement for debt
Movement in net debt in year (238,716) 1,895,859
Net funds/(debt) at 1 January 64,794 (1,831,065)
2002
Net (debt)/funds at 31 December (173,922) 64,794
2002
a) Reconciliation of operating profit to net cash inflow from operating
activities
2002 2001
# #
Operating loss (1,705,089) (1,115,300)
Amortisation charge 1,599,948 -
Depreciation charge 56,595 312,882
Loss on disposal of fixed assets - 75
Increase in stock (456,372) (78,318)
(Increase)/decrease in debtors (467,425) 40,377
Increase in creditors 757,314 29,256
(215,029) (811,028)
b) Analysis of net debt
At 1 At 31
January Cash December
2002 flow 2002
# # #
Cash at bank in hand 116,198 (116,131) 67
Bank overdraft (1,404) (171,585) (172,989)
114,794 (287,716) (172,922)
Due in less than one year (50,000) 49,000 (1,000)
Due in more than one year 64,794 (238,716) (173,922)
Notes:
1. Statutory accounts
The financial information presented does not constitute statutory accounts
as defined in Section 240 of the Companies Act 1985. The results have been
extracted from the accounts of the Group for the year ended 31 December
2002. The accounts, on which the auditors have issued an unqualified report,
will be sent to shareholders and delivered to the Registrar of Companies in
due course.
2. Exceptional goodwill write off of #1,371,615 is charged in respect of the
impairment in the carrying value of the goodwill on acquisition of Brindle
Limited.
3. Earnings per ordinary share
Basic and fully diluted loss per ordinary share has been calculated on the
Group's loss attributable to shareholders of #1,701,032 (2001: #1,137,712)
and on the weighted average number of ordinary shares in issue during the
financial year, which was 61,629,759 (2001: 42,964,551). Whilst unexercised
share options and warrants would increase the weighted average number of
ordinary shares in issue during the year, due to the losses they are not
considered dilutive. No shares have been issued between the year end and
date of approval of these financial statements.
4. Dividends
The Directors are not proposing that a dividend payment be made.
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