TIDMARE
RNS Number : 3363T
Arena Events Group PLC
24 November 2021
24 November 2021
Arena Events Group plc
("the Company" or "the Group")
Unaudited interim results for the six-months ended 30 September
2021
Arena Events Group plc (AIM: ARE) announces its unaudited
interim results for the six-months ended 30 September 2021 (H1
FY22) including the first fully consolidated results of Arena Aztec
Shaffer (AAS).
The guidance of a "transitional year" remains on track as events
continue to return to pre-pandemic levels in many markets. H1 FY22
has benefitted from a number of large major periodic events such as
the Olympics and the Ryder Cup, alongside a longer tail of pandemic
related projects and other relief work than was expected, which has
more than offset inflationary pressures and a tight labour
market.
Financial highlights (includes fully consolidated AAS from April
2021)
-- Revenue increased to GBP82.5m (6m Sept 20: GBP42.8m)
-- Gross profit margin decreased to 33.7 per cent. (6m
Sept 20: 34.6 per cent.) due to revenue mix
-- Adjusted EBITDA (1) increased to GBP12.3m (6m Sept 20:
GBP4.4m)
-- Operating profit of GBP4.1m (6m Sept 20: loss of GBP3.3m)
-- Profit after taxation of GBP2.5m (6m Sept 20: loss of
GBP5.3m)
-- Basic EPS of 0.8p (6m Sept 20: loss per share of 2.7p)
-- Period-end cash GBP31.3m (Sept 20: GBP15.5m), net debt
(2) GBP23.8m (Sept 20: GBP26.4m)
Financial highlights (excluding consolidated results of AAS)
-- Revenue increased to GBP65.0m (6m Sept 20: GBP42.8m)
-- Adjusted EBITDA (1) increased to GBP10.3m (6m Sept
20: GBP4.4m)
-- Period-end cash GBP28.6m (Sept 20: GBP15.5m), net debt
(2) GBP11.9m (Sept 20: GBP26.4m)
Operational highlights
-- In the UK & Europe - delivered structures, seating
and furniture at major events including the Open
at Royal St. Georges, the BMW PGA Championship at
Wentworth, the Cinch Tennis at Queen's Club and the
Wimbledon Tennis Championships; built a temporary
outdoor theatre for the Royal Shakespeare Company;
installed structures at Epsom and Newmarket racecourses
and seating for the Goodwood Revival and Festival
of Speed.
-- In the Middle East & Asia - seasonally quiet, with
activity focused on planning for the delivery of
new and returning projects in the UAE and KSA in
the second half of the year.
-- In the US - completed the acquisition of a 50 per
cent. interest in AAS; built over 600,000 sq.ft.
of tenting, approximately 8,000 seats and a number
of other temporary structures for the Ryder Cup in
Whistling Straits; supported a number of COVID-19
related and other relief projects across the country;
supplied structures to the 2021 U.S. Open, the PGA
Championships and the Experimental Aircraft Aviation
(EAA) AirVenture airshow.
Post period events
-- On 20 October announced a recommended cash offer
for the Group of 21 pence per share, being a 40.9
per cent. premium to the volume weighted average
price of 14.9 pence per share for the three months
to 19 October 2021 and a 50.0 per cent. premium to
the 14.0 pence per share subscription and placing
price completed in April 2021.
Greg Lawless, CEO, commented:
"As we reported back in July, FY22 is expected to be a
transitional year for the Group, as COVID-19 restrictions are
lifted at varying rates in each country in which we operate, giving
a different pace of recovery in the live events industry in each
market.
In H1 FY22 we have delivered world class solutions for a number
of large events such as the Tokyo Olympics and the Ryder Cup,
alongside the gradual return of many annual events, often adapting
to late-changing customer requirements. We have also seen a much
longer tail of projects in support of the COVID-19 pandemic and
other relief projects which has helped to protect margins in the
face of growing inflationary pressures and a tight labour market.
We are also pleased to have completed the acquisition of a 50 per
cent. stake in Arena Aztec Shaffer, along with our 50 per cent.
consortium partners, which has strengthened our offering in the US
market.
Despite the strong H1, it is worth noting that the second half
of our financial year is always seasonally much quieter than the
first, and this year will again most likely follow that pattern,
particularly in the US market where COVID-19 and other relief work
continues to reduce.
By way of conclusion, I am very grateful for the opportunity to
have been involved in the growth of the Arena Events Group over the
last fifteen years. It has been a journey that would not have been
possible without the support and commitment of all my colleagues
around our global operations."
Notes:
(1) Adjusted EBITDA is defined as earnings before interest, tax,
depreciation, intangible amortisation, exceptional items share
option costs and acquisition costs.
2) Net debt is per Senior Facility covenant definition,
excluding IFRS 16, but including both finance leases calculated on
a pre-IFRS16 basis and deferred consideration.
Enquiries:
Arena Events Group plc
Greg Lawless, CEO / Steve Trowbridge, CFO (contact via Alma)
Cenkos Securities (Nomad & Broker)
Derrick Lee / Max Gould (Corporate Finance) 0207 397 8900
Julian Morse (Sales)
Alma PR (Financial PR)
Josh Royston / John Coles / Matthew Young 0203 405 0205
About Arena Events Group plc
Arena Events Group plc (www.arenagroup.com) is a provider of
temporary physical structures, seating, ice rinks, furniture and
interiors. The Group has operations across Europe, the US, the
Middle East and Asia, and current clients include: The
Championships, Wimbledon; The Open; The Jockey Club; the PGA
European Tour; and the Ryder Cup.
The Group services major sporting, outdoor and leisure events,
providing a managed solution from concept and design through to the
construction and integration of the final structure and interior.
Contracts range in size and complexity from a simple equipment
rental for a local outdoor event, to an integrated solution of
multiple structures and interiors for a major international
sporting event. The Group also has a growing presence in other
markets serving a range of retail, industrial, governmental and
construction customers.
Arena Events Group plc
Chief Executive's Review
Introduction
We indicated in July 2021 that FY22 would be a transitional year
as the Group returned to normality and that is precisely our
experience during the first six months of FY22. We have seen
restrictions lifted at varying rates in each country in which we
operate, resulting in a different pace of recovery in the live
events industry in each market. In overall terms, the interim
results are an encouraging set of numbers, with a particularly
strong performance in the US, where those businesses have
benefitted from a longer tail of COVID-19 related work, disaster
relief revenues and the Ryder Cup. I am therefore pleased to report
that Group Adjusted EBITDA reached GBP12.3m in H1 FY22, including
the first contribution from Arena Aztec Shaffer (AAS) following its
acquisition in April.
Despite the encouraging first half, it should be noted that the
second half of Arena's financial year is always seasonally much
quieter than the first and this year, the balance between the two
periods will be even more extreme given the major periodic events
and the various relief work in H1 FY22 which will not be repeated
in the second half.
Operational Highlights
US Region:
The US Division now comprises three business units, including
the recently acquired 50 per cent. interest in Arena Aztec Shaffer
(100 per cent. of the results are consolidated, given management
control). All three performed well over the last six months and
delivered a strong EBITDA result, with the return to full spectator
events supplemented by long-term COVID-19 rentals and a number of
unplanned disaster relief jobs. The region reported revenues of
GBP54.0m and Adjusted EBITDA of GBP12.5m which was an excellent
first half performance. The region's revenues were delivered from a
mixture of sporting and non-sporting events which included:
1. The Ryder Cup
2. The US Open
3. The US PGA
4. The Experimental Aircraft Aviation (EAA) AirVenture airshow
5. The Travelers Championship
6. The Tour Championship
7. The Atlanta Open Tennis
8. A number of long-term COVID-19 related rentals
9. Several disaster relief jobs around the country
We are expecting a slower second half in the US as the benefit
of the Ryder Cup and a number of other "one-off" revenues,
delivered in the first half will not repeat, while ongoing labour
shortages in the market are limiting the scale and pace of any
additional recovery.
EMEA Region:
The region comprises the UK & Europe and the Middle East
& Asia businesses, managed by a single senior leadership team.
The combined region delivered revenues of GBP28.5m and an Adjusted
EBITDA of GBP1.0m for the six months to the end of September.
In H1 FY22, the UK & Europe region generated revenues and
Adjusted EBITDA of GBP20.1m and GBP2.1m respectively and the
majority of this revenue was derived from the welcome return of the
British summer events season, including:
1. The Wimbledon Championships
2. The Cinch Tennis at Queen's Club
3. The Open at Royal St. Georges
4. The Goodwood Revival and Festival Of Speed
5. Racing at Epsom and Newmarket racecourses
6. The provision of seating equipment for the delayed Tokyo 2020 Olympics
A number of small European Tour golf events also returned in the
UK, but there is no doubt that shortages of labour and transport
impacted the margins from these projects. This is a common problem
throughout the UK at the moment, and we believe that Arena will
continue to feel the impact of these increased cost factors in the
second half of the year.
The first six months of the financial year would typically
represent the quieter season for the Middle East & Asia region
and this year the first half was even weaker than normal as
restrictions on live events continued to curtail revenue
opportunities.
The results for the Middle East & Asia in H1 FY22 were
therefore disappointing as the region posted lower than expected
revenues of GBP8.4m and an Adjusted EBITDA loss of GBP1.1m.
Cash and Banking Facilities:
Including the fully consolidated results of AAS, the Group had
cash balances of GBP31.3m at the end of September leaving Group net
debt (covenant definition, pre-IFRS16) at GBP23.8m.
However, as the debt of AAS is non-recourse to the wider Arena
Events Group, it is also useful to assess the net debt position
excluding the consolidation of AAS. Under this measure, cash was
GBP28.6m and net debt (covenant definition, pre-IFRS16) was
GBP11.9m. This compares to a net debt position (covenant
definition, pre-IFRS16) of GBP21.1m at the end of March 2021, an
improvement of GBP9.2m. Of this change, GBP6.9m was received in
April 2021 as the net proceeds of the second portion of the equity
subscription and placing, with the balance being delivered from the
positive EBITDA and working capital performance of the Group,
offset by capital investment, debt repayment and the acquisition
cost of AAS.
Current Trading and Outlook:
The guidance of a 'transitional year' for the Arena Group
(excluding AAS) given in July 2021 remains on track as events
continue to return to pre-pandemic levels in many markets.
The first half of FY22 benefitted from a number of large major
periodic events such as the Olympics and the Ryder Cup, alongside a
longer tail of Pandemic related projects and other relief work than
was expected, which has more than offset inflationary pressures and
a tight labour market.
Despite the encouraging H1 FY22, the second half of our
financial year is always seasonally much quieter than the first.
This year, the balance between the two periods will be even more
extreme given certain major events and relief work in H1 FY22 which
will not repeat in the second half.
We therefore expect that, whilst the second half of FY22 will
again be quieter than H1 FY22, we expect that FY22 as a whole will
still deliver a positive "transitional" result, as the live events
world continues to return to normal alongside the continued
reduction in COVID-19 related revenues.
Greg Lawless
Arena Events Group plc CEO
Financial Review
Revenue and gross margin
The Group delivered GBP82.5m of revenue in the six-months ended
30 September 2021 (6m Sept 20: GBP42.8m), representing a 93 per
cent. increase compared with the corresponding period in 2020.
GBP19.1m of this revenue growth related to the first-time inclusion
of the consolidated results of Arena Aztec Shaffer (AAS), which was
acquired in April 2021. The remainder of the increase resulted from
the UK & Europe and US regions, where events began to return to
normal alongside a much longer than expected tail of COVID-19
projects and one-off disaster relief projects. The US also
benefitted significantly from the inclusion of the Ryder Cup at
Whistling Straits, while the UK Seating division also reported
revenues for the delayed Tokyo 2020 Olympics as the rental rolled
into a second year.
Gross margins across the Group decreased from 34.6 per cent. to
33.7 per cent. mainly due to a reduced level of capital sales
projects. The US margin returned to a more normal 37.4 per cent.
margin (6m Sept 2020: 55.7 per cent.) as a broad range of events,
including the Ryder Cup, returned at near full scope replacing
capital sales projects. The UK gross margin of 29.3 per cent. (6m
Sept 20: 30.1 per cent.) was slightly lower year on year as events
returned, albeit with inflationary pressures in both labour and
transport. The Middle East saw margins start to recover to 20.2 per
cent. (6m Sept 20: 8.5 per cent.). Although this was still lower
than the long-run average due to the low levels of activity, it
improved from the comparator six-month period which had been
dominated by just one large COVID-19 related project.
Administrative expenses
Administrative expenses were GBP23.7m in the six-months ended
September 2021, compared to GBP18.0m in the same period in 2020, a
31.6 per cent. increase. The first-time inclusion of AAS accounted
for GBP4.7m of the growth, while the balance related largely to
salary costs, being a combination of headcount growth, the lifting
of Pandemic-reduced management salaries, and inflationary
pressures. Excluding the effect of AAS, at a regional level the
highest increase was in the UK & Europe with staff returning
following an extended period of furlough in the prior year.
Meanwhile the MEA region saw a fall in administrative expenses as
cost reduction actions, such as unpaid leave, enacted part way
through FY21 to match the slowdown in activity benefitted the full
H1 FY22 period.
Adjusted EBITDA
Adjusted EBITDA is defined as earnings before interest, tax,
depreciation, amortisation, exceptional items and acquisition
costs. The Group uses alternative performance measures such as
Adjusted EBITDA to allow the users of the financial statements to
gain a clearer understanding of the underlying performance of the
business without the impact of one-off non-recurring costs of an
exceptional nature. Adjusted EBITDA (further excluding the impact
of IFRS16) is also part of the Group's covenant structure in its
Senior Facility Agreement.
The Group's Adjusted EBITDA increased to GBP12.3m in the
six-months ended 30 September 2021, compared to GBP4.4m in the same
period last year. The first-time inclusion of AAS accounted for
GBP2.0m of the EBITDA growth. Adjusted EBITDA margin also improved
from 10.3 per cent. in 2020 to 14.9 per cent. in 2021.
Operating profit and loss after tax
The Group generated an operating profit of GBP4.1m for the
six-months ended 30 September 2021, compared with a loss of GBP3.3m
in the same period in 2020. This outturn largely reflects the
GBP7.9m increase in Adjusted EBITDA described above, offset by
GBP0.6m of additional fixed asset depreciation due to the
first-time consolidation of the results of AAS. Exceptional costs
were GBP0.2m in the six-months ended 30 September 2021, compared to
GBP0.8m in 2020, while acquisition costs of GBP0.8m in H1 FY22
related to the AAS acquisition and compare to a nil cost in the
prior year. Intangible amortisation was broadly consistent with the
prior year, while depreciation of right of use assets fell by
GBP0.1m as a number of finance leases were fully settled.
Interest expense of GBP0.6m in the six-months ended 30 September
2021 relates to the interest cost of the Group's bank debt, with
the year-on-year fall reflecting a lower senior facility interest
rate. Other finance costs increased GBP0.7m year-on-year due to the
first-time consolidation of the cost of debt in AAS.
Profit before tax for the six-months ended September 2021 was
GBP2.1m compared to a GBP4.7m loss in 2020. After accounting for a
minority interest credit of GBP0.4m relating to AAS, the Group's
profit after tax for the period was GBP2.5m (6m Sept 2020: loss of
GBP5.3m). There was no tax charge in the period (6m Sep 21: GBP0.6m
charge).
Earnings per share
Basic earnings per share (EPS) for the six-months ended
September 2021 was 0.8p per share. The figure for the comparative
period in 2020 was a loss of 2.7p per share.
Dividends
No interim dividend has been declared for the six-months ended
30 September 2021 (6m Sept 2020: Nil)
Cash flow
The Group generated operating cash flow of GBP13.1m in the
six-months ended September 2021 compared with GBP6.0m in the same
period in 2020. The GBP7.4m higher operating profit in H1 FY22
period was the main driver of the increase, as working capital
movements were broadly flat year on year with a net GBP2.6m inflow
in the six months ended 30 September 2021, compared to a net
GBP2.3m inflow in the six months ended 20 September 2020. Working
capital in H1 FY22 benefitted from some large receipts at the end
of the period, relating to a number of large projects in the Middle
East which are due to be delivered in H2 FY22. Without those late
inflows, working capital would have been slightly negative in the
six months ended 30 September 2021, in line with expectations.
Capital expenditure
Net capital expenditure (additions less proceeds from disposals)
in the six-months ended 30 September 2021 was GBP2.9m, compared
with GBP2.4m in the same period in 2020. Whereas in H1 FY21 the
spend was concentrated on commitments made prior to the COVID-19
pandemic in support of what was to have been a busy golf season in
the US, the spend in H1 FY22 has been more widely spread across a
range of business units and projects.
Balance sheet
At the end of September 2021, goodwill and other intangibles
stood at GBP39.3m, compared with GBP38.9m at the end of September
2020. No reassessment has been made of the carrying values of any
intangible assets during the six-month period, with the
year-on-year increase instead reflecting the intangibles acquired
with AAS offset by the amortisation of other intangibles.
Property, plant and equipment at 30 September 2021 of GBP57.6m
was GBP7.3m higher than at 30 September 2020. The consolidation of
AAS brought an additional GBP12.2m of NBV assets onto the Group
balance sheet, with depreciation in the remainder of the Arena
Group being the balancing movement. The net book value (NBV) of
fixed assets on the AAS balance sheet has been calculated on a "no
bargain purchase" methodology consistent with IFRS3 Business
Combinations.
Cash at 30 September 2021 was GBP31.3m, giving a net debt
position (covenant definition, pre-IFRS16) of GBP23.8m. At the end
of September 2021, the Group's drawn senior debt facility remained
at GBP34.5m, in line with the March position, supported by
overdraft and guarantee facilities in the US and Middle East.
During H1 FY22 the GBP2m short-term financing facility with Lombard
Odier Investment Management was repaid, while the Group also made
various finance lease repayments with a balance outstanding of only
GBP0.1m as at 30 September 2021, compared to GBP1.5m at the same
date in 2020.
In April 2021 the Group received proceeds of GBP6.9m after
expenses from the GBP11m equity fundraising announced on 29 March
2021, and also drew down GBP4m from its GBP15.6m Coronavirus Large
Business Interruption Loan Scheme ("CLBILS") facility, in line with
the required activity to maintain access to the facility.
During the six months ended 30 September 2021 the Group paid no
dividends but made a GBP36k deferred consideration payment relating
to the Williams Party Rental acquisition that had completed in July
2020.
Post balance sheet events
On 20 October 2021 a recommended cash offer for the Group of 21
pence per share was announced. The offer represented a 40.9 per
cent. premium to the volume weighted average price of 14.9 pence
per share for the three months to 19 October 2021 and a 50.0 per
cent. premium to the 14.0 pence per share subscription and placing
price completed in April 2021.
In October 2021 the Group elected not to draw any additional
funds under its GBP15.6m Coronavirus Large Business Interruption
Loan Scheme ("CLBILS") facility. The undrawn GBP11.6m therefore
lapsed and is no longer accessible.
Exchange rates
The reported figures use an average US$ rate of $1.38 for the
period (2019: $1.26) and a period end rate of $1.38 (2019
$1.32).
Condensed consolidated income statement
For the six-months ended 30 September 2021
6 mths 6 mths
ended ended Year ended
30 Sept 30 Sept 31 March
2021 2020 2021
(unaudited) (unaudited) (audited)
GBPm GBPm GBPm
------------ ------------ -----------
Revenue 82.5 42.8 71.6
Cost of sales (54.7) (28.0) (44.6)
--------------------------- ------------ ------------ -----------
Gross profit 27.8 14.8 27.0
Administrative expenses (23.7) (18.0) (36.8)
--------------------------- ------------ ------------ -----------
Operating (loss) /
profit 4.1 (3.3) (9.8)
------------ ------------
Analysed as:
Adjusted EBITDA 12.3 4.4 5.7
Depreciation fixed
assets (4.7) (4.1) (7.8)
Depreciation right
of use assets (2.2) (2.3) (4.7)
Exceptional costs (0.2) (0.8) (2.7)
Acquisition costs (0.8) (0.0) (0.1)
Share option costs (0.1) - 0.4
Intangible amortisation (0.3) (0.3) (0.6)
--------------------------- ------------ ------------ -----------
Interest expense (0.6) (0.8) (1.6)
Other finance costs (1.4) (0.7) (1.4)
--------------------------- ------------ ------------ -----------
Profit/(loss) before
taxation 2.1 (4.7) (12.8)
Tax on profit/(loss)
on ordinary activities (0.0) (0.6) 0.1
Non-controlling interest 0.4 - -
------------
Profit/(loss) after
taxation 2.5 (5.3) (12.7)
--------------------------- ------------ ------------ -----------
Adjusted EBITDA reflects earnings before interest, taxation,
depreciation, exceptional items, acquisition costs, share option
costs and intangible amortisation
Earnings/(loss) per share
For the six-months ended 30 September 2021
6 mths ended 6 mths ended Year ended
30 Sept 30 Sept 31 March
2021 2020 2021
(unaudited) (unaudited) (unaudited)
------------- ------------- ------------
Basic profit/(loss)
per share - pence 0.8 (2.7) (5.2)
Diluted profit/(loss)
per share 0.7 (2.7) (5.2)
Statement of comprehensive income
For the six-months ended 30 September 2021
6 mths 6 mths
ended ended Year ended
30 Sept 30 Sept 31 March
2021 2020 2021
(unaudited) (unaudited) (audited)
GBPm GBPm GBPm
------------ ------------ -----------
Profit/(loss) for
the period 2.5 (5.3) (12.7)
Items that may be
reclassified subsequently
to profit or loss:
Exchange differences
on translation of
foreign subsidiaries 0.3 (0.4) (1.5)
------------ ------------ -----------
Other comprehensive
income for the period
net of tax 0.3 (0.4) (1.5)
------------ ------------ -----------
Total comprehensive
profit/(loss) for
the period 2.8 (5.7) (14.2)
------------ ------------ -----------
Total comprehensive
profit/(loss) attributable:
Owners of the company 2.4 (5.7) (14.2)
Non-controlling interests 0.4 - -
-----------
2.8 (5.7) (14.2)
------------ ------------ -----------
Condensed consolidated balance sheet
As at 30 September 2021
30 September 30 September 31 March
2021 2020 2021
(unaudited) (unaudited) (audited)
GBPm GBPm GBPm
-------------------------------- ------------- ------------- ----------
Non-current assets
Goodwill and other intangibles 39.3 38.9 37.8
Property, plant and equipment 57.6 50.3 45.0
Right of use asset 17.0 21.1 18.5
Investments - - -
Trade and other receivables
due after one year 0.8 0.8 0.7
-------------------------------- ------------- ------------- ----------
114.7 111.0 102.0
Current assets
Inventories and WIP 8.4 7.8 2.3
Trade and other receivables 22.6 16.3 8.2
Cash and cash equivalents 31.3 15.5 18.4
-------------------------------- ------------- ------------- ----------
62.4 39.6 28.9
Current liabilities
Trade and other payables (17.2) (11.7) (16.0)
Bank overdraft (0.1) - (0.4)
Borrowings (2.9) (2.2) (4.5)
Bank interest (0.4) (0.8) -
Current tax liabilities (0.0) 0.0 -
Lease liabilities (3.6) (5.6) (3.3)
Accruals (12.9) (11.4) (8.7)
Deferred revenue (18.5) (11.0) (3.2)
Deferred consideration (0.1) (1.0) (0.1)
-------------------------------- ------------- ------------- ----------
(55.8) (43.8) (36.2)
Net current liabilities 6.5 (4.1) (7.3)
Total assets less current
liabilities 121.2 106.9 94.7
Non-current liabilities
Borrowings (51.2) (36.7) (34.0)
Lease liabilities (14.6) (17.6) (15.6)
Other creditors (0.7) (1.3) -
Deferred tax liabilities (0.7) (1.3) (0.8)
-------------------------------- ------------- ------------- ----------
(67.2) (56.9) (50.4)
Net assets 54.0 49.9 44.3
-------------------------------- ------------- ------------- ----------
Equity
Share capital 3.3 2.5 2.7
Share premium account 96.4 86.8 89.7
Merger reserve 10.9 10.9 10.9
Share option reserve 0.2 0.6 0.2
Retranslation reserve (3.5) (2.7) (3.8)
Minority interest (0.4) - -
Retained earnings (53.0) (48.1) (55.4)
-------------------------------- ------------- -------------
Total equity 54.0 49.9 44.3
-------------------------------- ------------- ------------- ----------
Condensed consolidated Group cash flow statement
6 months 6 months
ended ended Year ended
30 September 30 September 31 March
2021 2020 2021
(unaudited) (unaudited) (audited)
GBPm GBPm GBPm
-------------- -------------- -----------
Cash flow from operating activities
Operating profit/(loss) for the period 4.1 (3.3) (9.8)
Adjustments for:
Depreciation of property, plant and
equipment 4.7 4.1 7.8
Depreciation of right of use assets 2.2 2.3 4.7
Amortisation of intangibles 0.3 0.3 0.6
Deferred consideration (0.0) 0.1 -
Gain on disposal of property, plant
and equipment (0.2) (0.0) 0.2
Share option costs 0.1 - (0.4)
Decrease in provisions (0.7) (0.0) -
---------------------------------------------- -------------- -------------- -----------
Operating cashflows before changes
in working capital 10.5 3.6 3.1
(Increase)/decrease in inventories (6.2) (0.1) 5.4
(Increase)/decrease in receivables (14.9) 16.1 23.3
Increase/(decrease) in payables 23.7 (13.7) (19.4)
---------------------------------------------- -------------- -------------- -----------
Cash generated by operations 13.1 6.0 12.4
Bank interest paid (0.4) (0.0) (1.3)
Loan note interest paid (0.1) (0.0) (0.3)
Other finance charges (1.1) (0.0) (0.1)
Corporation tax 0.0 (0.6) (0.6)
---------------------------------------------- -------------- -------------- -----------
Net cash inflow from operating activities 11.6 5.3 10.1
---------------------------------------------- -------------- -------------- -----------
Cash flow from investing activities
Proceeds on disposal of property, plant
and equipment 0.4 0.6 1.4
Purchases of property, plant and equipment (3.3) (3.0) (5.2)
Investment in business combinations (15.6) - -
net of cash acquired
---------------------------------------------- -------------- -------------- -----------
Net cash used in investing activities (18.5) (2.4) (3.8)
Cash flow from financing activities
Increase in borrowings (1) 17.9 - 0.5
Repayment of borrowings (0.3) (0.1) (0.2)
Lease payments (2.7) (2.2) (5.4)
Proceeds on issue of shares net of
costs 7.3 9.3 12.4
Shareholder loan notes paid (2.4) - -
Payment of loan note interest - - 0.1
Deferred consideration paid - - (0.8)
Net cash generated from financing activities 19.8 7.0 6.6
---------------------------------------------- -------------- -------------- -----------
Net increase in cash and cash equivalents 12.9 10.0 12.9
Cash and cash equivalents at the beginning
of the period 18.4 5.8 5.8
Effect of foreign exchange rate changes (0.0) (0.2) (0.3)
---------------------------------------------- -------------- -------------- -----------
Cash and cash equivalents at the end
of the period 31.3 15.5 18.4
---------------------------------------------- -------------- -------------- -----------
Note to Borrowings:
1) The increase in borrowings of GBP17.9m during the six months
to September 2021 comprises an additional GBP4.0m funding under the
UK Government-backed Coronavirus Large Business Interruption Loan
Scheme (CLBILS) and GBP13.9m funding from Arena's co-bidders in the
acquisition of Arena Aztec Shaffer (AAS)
Notes to the Interim Report
1. General information
Arena Events Group plc (the "Company" or "the Group") is a
public company limited by shares incorporated in the United Kingdom
under the Companies Act 2006 (registration number 10799086) and is
registered in England & Wales. The registered address is 4 Deer
Park Road, London, SW19 3GY. Copies of this Interim Report may be
obtained from the registered address or on the Corporate (Investor
Relations) section of the Company's website at
www.arenagroup.com.
Statement of compliance and basis of preparation
The condensed consolidated financial information presented in
this Interim Report has been prepared in accordance with
international accounting standards in conformity with the
requirements of the Companies Act 2006. The financial information
has been prepared using the historical cost convention and on a
going concern basis.
The statutory accounts for the year ended 31 March 2021 have
been delivered to the Registrar of Companies. The Independent
Auditors' Report on those accounts was unqualified, did not draw
attention to any matters by way of emphasis, and did not contain a
statement under s498(2) or s498(3) of the Companies Act 2006.
The financial information for the six-months ended 30 September
2021 and the six-months ended 30 September 2020 is unaudited and
does not constitute statutory accounts for the year. The accounting
policies applied in these interim accounts are consistent with
those adopted in the Group's 31 March 2021 audited Group statutory
accounts.
The Interim financial statements are presented in sterling and
all values are rounded to the nearest hundred thousand pounds
(GBP0.1m) except where otherwise indicated. Percentage movements
and margins are calculated from these rounded numbers.
Critical accounting judgements
As a result of the acquisition of Aztec Shaffer new critical
accounting judgements have been made in the six months to 30
September 2021:
-- Control over Arena Aztec Shaffer LLC (AAS)
The directors of the Company assessed whether or not the Group
has control over AAS based on whether the Group has control over
the day-to-day running of the business. After assessment, the
directors concluded that it is indeed in a position of control and
that this was further supported by the Management Services
Agreement in place.
-- Purchase price allocation
The acquisition accounting of the assets acquired from Aztec
Shaffer, including the fair value adjustment, is provisional as at
30 September 2021 in line with the requirements of IFRS3 Business
Combinations.
UK Government Grants and Support
During the six months to 30 September 2021, the UK division of
the Group received GBP0.1m (six months to 30 September 2020:
GBP2.3m) from HMRC under the Coronavirus Job Retention Scheme in
relation to staff who had been furloughed. Amounts received have
been offset against payroll related expenses in the period.
Segmental analysis
6 months ended 30 September 2021 (unaudited)
UK&E ME&A US HO Total
GBPm GBPm GBPm GBPm GBPm
Revenue
Hire 19.1 7.9 52.1 - 79.1
Sales 1.0 0.6 1.9 - 3.4
--------- ---------- --------- -------- ---------
Total revenue 20.1 8.4 54.0 - 82.5
Gross profit
Hire 5.6 1.5 18.6 - 25.7
Sales 0.3 0.2 1.6 - 2.1
--------- ---------- --------- -------- ---------
Total gross profit 5.9 1.7 20.2 27.8
Administration expenses (3.8) (2.8) (7.7) (1.1) (15.5)
--------- ---------- --------- -------- ---------
Adjusted EBITDA 2.1 (1.1) 12.5 (1.1) 12.3
Reconciliation of segment
result to profit/(loss)
before tax:
Depreciation & amortisation (1.4) (0.8) (2.8) (0.0) (5.1)
Right of use asset depreciation (0.6) (0.3) (1.4) - (2.2)
Exceptional costs (0.4) 0.2 - (0.0) (0.2)
Acquisition costs - - (0.3) (0.4) (0.8)
Share option costs - - - (0.1) (0.1)
Net finance expense (0.3) (0.1) (1.3) (0.4) (2.0)
--------- ---------- --------- -------- ---------
Profit/(loss) before
tax (0.5) (2.1) 6.6 (1.9) 2.1
6 months ended 30 September 2020 (unaudited)
UK&E ME&A US HO Total
GBPm GBPm GBPm GBPm GBPm
Revenue
Hire 6.8 12.7 13.1 - 32.6
Sales 4.5 0.2 5.4 - 10.2
--------- ---------- --------- -------- ---------
Total revenue 11.3 12.9 18.5 - 42.8
Gross profit
Hire 2.8 1.0 5.6 - 9.5
Sales 0.5 0.1 4.6 - 5.3
--------- ---------- --------- -------- ---------
Total gross profit 3.4 1.1 10.3 - 14.8
Administration expenses (2.3) (3.8) (3.7) (0.6) (10.4)
--------- ---------- --------- -------- ---------
Adjusted EBITDA 1.0 (2.6) 6.6 (0.6) 4.4
Reconciliation of segment
result to profit/(loss)
before tax:
Depreciation & amortisation (1.5) (1.3) (1.7) (0.0) (4.5)
Right of use asset depreciation (0.7) (0.5) (1.1) - (2.3)
Exceptional costs (1.3) 0.6 (0.1) (0.0) (0.8)
Acquisition costs - - (0.0) - (0.0)
Share option costs - - - - -
Net finance expense (0.3) (0.2) (0.7) (0.3) (1.5)
--------- ---------- --------- -------- ---------
Profit/(loss) before
tax (2.7) (4.0) 3.0 (1.0) (4.7)
Year ended 31 March 2021 (audited)
UK&E ME&A US HO Total
GBPm GBPm GBPm GBPm GBPm
Revenue
Hire 13.0 17.6 27.9 - 58.5
Sales 6.6 0.2 6.3 - 13.1
--------- ---------- --------- -------- ---------
Total revenue 19.6 17.8 34.2 - 71.6
Gross profit
Hire 5.8 1.9 13.5 - 21.2
Sales 0.4 0.2 5.2 - 5.8
--------- ---------- --------- -------- ---------
Total gross profit 6.2 2.1 18.7 27.0
Administration expenses (5.0) (6.6) (8.5) (1.2) (21.3)
--------- ---------- --------- -------- ---------
Adjusted EBITDA 1.2 (4.5) 10.2 (1.2) 5.7
Reconciliation of segment
result to profit/(loss)
before tax:
Depreciation & amortisation (2.7) (2.5) (3.2) - (8.4)
Right of use asset depreciation (1.7) (1.1) (1.9) - (4.7)
Exceptional costs (4.1) (1.7) (0.1) 3.2 (2.7)
Acquisition costs - - (0.1) - (0.1)
Share option costs - - - 0.4 0.4
Net finance expense (0.9) (0.3) (1.2) (0.6) (3.0)
--------- ---------- --------- -------- ---------
Profit/(loss) before
tax (8.2) (10.1) 3.7 1.8 (12.8)
2. Earnings per share
Six months to Six months to Year ended
30 Sept 2021 30 Sept 2020 31 Mar 2021
(unaudited) (unaudited) (audited)
Weighted Weighted Weighted
average average average
Profit number Loss number Loss number
GBPm of shares GBPm of shares GBPm of shares
------- ------------ ------ ------------ ------- ------------
2.5 322,166,388 (5.3) 196,317,390 (12.7) 244,134,863
Profit/(loss)
per share pence:
- basic 0.8 (2.7) (5.2)
Diluted Diluted Diluted
average average average
Profit number Loss number Loss number
GBPm of shares GBPm of shares GBPm of shares
------- ------------ ------ ------------ ------- ------------
2.5 333,917,625 (5.3) 196,317,390 (12.7) 254,203,727
Profit/(loss)
per share pence:
- diluted 0.7 (2.7) (5.2)
3. Arena Aztec Shaffer acquisition
Assets Fair value Total
acquired adjustment acquired
(unaudited) (unaudited) (unaudited)
GBPm GBPm GBPm
------------ ------------ ------------
Intangible:
- Customer Relationships - 0.9 0.9
- Brand - 0.8 0.8
Tangible assets 14.8 (1.9) 12.9
ROU assets 1.2 - 1.2
Other assets and liabilities (0.3) 0.1 (0.1)
Cash in hand 0.0 0.1 0.1
------------ ------------ ------------
Net assets acquired 15.8 (0.0) 15.8
Goodwill - 0.0 0.0
------------ ------------ ------------
Consideration 15.8 - 15.8
Satisfied by:
Cash paid 15.8 - 15.8
------------ ------------ ------------
15.8 - 15.8
The acquisition accounting of Aztec Shaffer is provisional as at
30 September 2021 in line with the requirements of IFRS3 Business
Combinations.
4. Deferred consideration
During the period the Group made a GBP36k deferred consideration
payment relating to the Williams Party Rental acquisition that
completed in July 2020.
5. Dividends
No interim dividend has been declared for the six-months ended
September 2021 (6m Sept 20: Nil), and no dividends were paid in
respect of the year ended 31 March 2021 (6m Sept 20: Nil).
6. Post balance sheet events
On 20 October 2021 a recommended cash offer for the Group of 21
pence per share was announced. The offer represented a 40.9 per
cent premium to the volume weighted average price of 14.9 pence per
share for the three months to 19 October 2021 and a 50.0 per cent
premium to the 14.0 pence per share subscription and placing price
completed in April 2021.
In October 2021 the Group also decided not to draw any
additional funds under its GBP15.6m Coronavirus Large Business
Interruption Loan Scheme ("CLBILS") facility. The undrawn GBP11.6m
therefore lapsed and is no longer accessible.
Ends.
, the news service of the London Stock Exchange. RNS is approved by
the Financial Conduct Authority to act as a Primary Information
Provider in the United Kingdom. Terms and conditions relating to
the use and distribution of this information may apply. For further
information, please contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
IR FLFVTLFLVFIL
(END) Dow Jones Newswires
November 24, 2021 01:59 ET (06:59 GMT)
Arena Events (LSE:ARE)
Historical Stock Chart
From Feb 2024 to Mar 2024
Arena Events (LSE:ARE)
Historical Stock Chart
From Mar 2023 to Mar 2024