RNS Number:9446R
First Artist Corporation PLC
25 February 2002
Embargoed Release: 0700 hours 25th February 2002
First Artist Corporation Plc ("First Artist" or "the Company")
Interim Results for the six months ended 31 December 2001
First Artist is a leading European management and representation company looking
after the commercial interests of footballers and other high profile
personalities in the football and television market.
Highlights
- Sales up 205 per cent. to £3.0 million;
- Operating profit before goodwill up 100 per cent. to £1.0 million;
- Acquisition of FIMO completed on 21 December 2001 with effective control from
1 July 2001 - integration progressing well;
- Listing on AIM on 21 December 2001;
- £5 million raised through placing on 21 December 2001;
- Acquisition of Ian Elliott football agency completed on 19 July 2001;50 (2000:
24) football deals completed during the period;
- Increase in the number of FIFA registered agents employed by the Group to 7
(2000: 2); and
- Investment in UK media division.
Jon Smith, Chief Executive of First Artist Corporation plc, comments:
'I am pleased to report that the integration of FIMO within the First Artist
group is progressing successfully. We have completed a number of cross-border
deals during the period, which were only made possible by the alliance, and we
are already benefiting from the improved information flow across Europe. We are
continuing to explore new alliances, which will allow us to access new football
markets and accelerate our expansion across the globe. This expansion will
proceed in priority markets based on potential profitability.
We are also looking at investment in areas outside of football. We have expanded
our presence in media personality representation organically by developing a
separate division and formalising our offering through a dedicated agency
service. I look forward to the balance of this year with confidence."
Headline numbers Six months ended 31 Six months ended 31 Year ended 30 June
December 2001 December 2000 2001
(Unaudited) (Unaudited) (Audited)
£m £m £m
Sales 3.0 1.0 1.7
Operating profit* 1.0 0.5 0.7
Profit before tax* 1.0 0.5 0.7
Earnings per share (pence)* 1.91 1.84 2.27
Fully diluted earnings per share* 1.81 1.84 2.24
* Stated before goodwill amortisation of £653,000 (2000: £nil).
For further details please contact:
Jon Smith - Chief Executive Tel: 020 8900 1818
First Artist Corporation plc
www.1startist.com
Kirsty Campbell Tel: 020 7648 8721
Seymour Pierce Limited
Adam Reynolds/Takki Sulaiman Tel: 020 7735 9415
Hansard Communications
www.hansardcommunications.com
mail@hansardcommunications.com
Chairman's Statement
For the six months ended 31 December 2001
I am pleased to present our maiden interim results as an AIM-listed company for
the six months ended 31 December 2001. First Artist joined the Alternative
Investment Market on 21 December 2001, completing its acquisition of FIMO Sport
Promotion AG ("FIMO") and successfully raising £5 million from institutional and
other investors.
Sales increased to £3.0 million for the six-month period ended 31 December 2001,
up from £1.0 million in the corresponding period last year. These sales include
£2.0 million from the acquisitions made in the period. An operating profit of
£1.0 million before goodwill amortisation was generated compared to £0.5 million
in the corresponding period last year. The operating profit includes £0.75
million generated by the acquisitions made in the period. Earnings per share
before goodwill amortisation was 1.91 pence compared to 1.84 pence in the
corresponding period last year. The Board intends to use its funds to expand its
operations and to provide working capital and no interim dividend payment will
be made this year.
Group and financial review
Sales
The consolidated results of the Group include the results of FIMO from 1 July
2001 and the results of the business acquired from Mr Ian Elliott from 19 July
2001.
The Group generated sales of £3.0 million in the period, up 205% on the
corresponding period last year. Sales of £1.0 million, up 7.1% on the
corresponding period last year were generated in the continuing business of
First Artist, the remainder coming from the acquisitions of FIMO and Ian
Elliott's business. There were 50 football deals (2000: 24) during the period,
31 originating in the UK and 19 in Europe.
£1.4million (June 30 2001: £0.3million) of conditional income is carried forward
to be recognised in future periods.
Gross profit
The gross profit is stated after third-party commissions payable of £0.6 million
(2000: £nil) which represents around 20% of the gross commissions earned. 26% of
this cost represents third-party commission payable within contracts derived in
the UK, and the balance represents commission payable within contracts derived
in Europe.
Operating profit before goodwill amortisation
The operating profit before goodwill amortisation is stated after deducting
operating expenses. The operating profit earned by the Group during the period
was £1.0 million compared to £0.5 million in the corresponding period last year.
Operating profit of £0.25 million (2000: £0.5 million) was generated in the
continuing business of First Artist, the remainder coming from the acquisitions
of FIMO and Ian Elliott. The increase in overheads (including PLC costs) has
been borne by the continuing business of First Artist.
The operating expenses of £1.4 million include £0.65 million (2000: £0.46)
incurred by the continuing business of First Artist. This increase primarily
represents the cost of an increased head-count from 6 at the end of the
corresponding period last year to 14 at 31 December 2001, combined with the
associated costs of being a plc. In addition the continuing business has
invested around £0.1 million in relation to its new media division.
Goodwill amortisation
The Group has adopted Financial Reporting Standard 10 and consequently any
purchased goodwill arising on consolidation in respect of acquisitions made has
been capitalised. This goodwill is amortised by equal annual instalments over
its useful economic life. The goodwill of FIMO has been amortised from the date
of taking control of that business being 1 July 2001. The goodwill of Ian
Elliott has been amortised from the date of acquisition being 19 July 2001. The
goodwill amortisation charge for the period is £653,000 (2000: £nil).
Taxation
The charge for taxation is based on the estimated effective rate for the year as
a whole. The underlying tax charge before goodwill amortisation is 17.1% (2000:
33.3%). This rate is less than the UK standard rate due to the high proportion
of profits generated in Switzerland.
Earnings per share
The adjusted basic earnings per share before goodwill amortisation was 1.91
pence (2000: 1.84 pence) based on a weighted average number of shares in issue
of 44,247,826 (2000: 18,650,000), and based on a profit after tax of £845,000
(2000: £344,000). The fully diluted earnings per share was 1.81 pence (2000:
1.84 pence) based on 46,747,826 shares (2000: 18,650,000). The earnings per
share calculations have included the shares issued in consideration for FIMO on
21 December 2001 as though they were in issue for the entire period from the
date of taking control of that company on 1 July 2001.
The earnings per share was 0.43 pence (2000: 1.84 pence) and the fully diluted
earnings per share was 0.41 pence (2000: 1.84 pence).
Balance sheet
The net assets of the Group increased from £3.0 million to £15.9 million as at
31 December 2001 representing £0.3 million of profit and foreign exchange
translation adjustments for the financial period and £12.6 million of new share
capital net of costs. The net assets comprise of £12.2 million of unamortised
goodwill, £0.7 million of tangible assets, £4.1 million of net current assets
less £1.1 million of long-term creditors. The net current assets of £4.1 million
is made up of £4.2 million of cash and £2.0 million of working capital less £2.1
million of deferred consideration. The working capital of £2.0 million includes
an amount of £1.2 million representing debtors due in more than one year.
Liquidity and capital resources
At 31 December 2001, the Group's cash balance stood at £4.2 million, up from
£2.4 million at 30 June 2001. Around £0.9 million of this cash balance will be
paid to the vendors of FIMO over the next twelve months.
£4.4 million was raised net of costs through the placement of 10 million shares
at 50 pence on 21 December 2001. £4.2 million was utilised on the purchase of
Ian Elliott and FIMO for £0.3 million and £3.9 million respectively. £0.5
million was spent on capital expenditure and £0.2 million was paid in
corporation tax. The remaining sources of funds included cash acquired in FIMO
of £1.6 million representing £1.1 million of loans repaid by the vendors and
£0.5 million of cash and £0.7 million of operating cash from £1.0 million of
operating profit before goodwill amortisation.
Acquisitions
On 19 July 2001 the Group acquired the client listing and services of Ian
Elliott, a football agent, for a total consideration of £405,000 excluding
costs. This consideration is payable in three instalments over the two years
following acquisition.
Goodwill arising from this acquisition was £472,000.
On 21 December 2001 the Group acquired the whole of the issued share capital of
FIMO, although the effective date of control was agreed between the parties as
being 1 July 2001. The consideration was made up of £3.0 million of cash and the
allotment and issue of 16,650,000 ordinary shares of 0.25 pence each to the
value of £8.33 million. In addition the Group has agreed to pay an amount equal
to the aggregate of the net assets of FIMO at 30 June 2001 less its fixed assets
and the expected payments due under certain transfer contracts. This represents
around £3.8 million of which £0.8 million was paid on completion.
Goodwill arising from this acquisition was £12.3 million.
Outlook and current operations
The board considers these results satisfactory and in line with the plans set
for this half year. The acquisition of FIMO has delivered the initial benefits
envisaged, and the management teams are integrating well. We see this as the
beginning of our expansion of football activities overseas. Current trading
remains in line with our plans and expectations.
Chairman
Brian Baldock
22nd February 2002
Consolidated Profit and Loss Account
For the six months ended 31 December 2001
Notes Six months ended 31 Six months ended 31 Year
December 2001 December 2000 ended 30
(Unaudited) £000's (Unaudited) £000's June
2001
(Audited)
£000's
Sales Continuing 1,037 968 1,702
Acquisitions 1,915 - -
2,952 968 1,702
Cost of sales (616) - (22)
Gross profit 2,336 968 1,680
Operating expenses (1,360) (455) (1,002)
Operating profit before
goodwill amortisation
Continuing 223 513 678
Acquisitions 753 - -
976 513 678
Goodwill amortisation (653) - -
Operating profit after
goodwill amortisation 323 513 678
Investment income 53 17 63
376 530 741
Interest payable (10) (14) (26)
Profit on ordinary
activities before
taxation 366 516 715
Taxation 2 (174) (172) (237)
Profit on ordinary
activities after taxation 192 344 478
Dividends 3 - - (37)
Retained profit for the
period 192 344 441
Adjusted earnings per
share 4 1.91 pence 1.84 pence 2.27 pence
Adjusted fully diluted
earnings per share 4 1.81 pence 1.84 pence 2.24 pence
Basic earnings per share 4 0.43 pence 1.84 pence 2.27 pence
Diluted earnings per
share 4 0.41 pence 1.84 pence 2.24 pence
Consolidated Balance Sheet
As at 31 December 2001
Notes As at As at As at
31 December 2001 31 December 2000 30 June
(Unaudited) £000's (Unaudited) £000's 2001
(Audited)
£000's
FIXED ASSETS
Intangible assets 7 12,157
Tangible assets 732 161 297
12,889 161 297
CURRENT ASSETS
Debtors 4,572 837 1,167
Cash at bank and in hand 4,237 795 2,391
8,809 1,632 3,558
CREDITORS: Amounts falling due (4,739) (947) (877)
within one year
NET CURRENT ASSETS 4,070 685 2,681
TOTAL ASSETS LESS CURRENT 16,959 846 2,978
LIABILITIES
CREDITORS: Amounts falling due (1,066) - -
in greater than one year
Provision for liabilities and (11) - (11)
charges
NET ASSETS 15,882 846 2,967
CAPITAL AND RESERVES
Called up share capital 6 134 10 67
Share premium account 6 14,485 1,966
-
Profit and loss account 6 1,263 836 934
15,882 846 2,967
Consolidated Cash Flow Statement
For the six months ended 31 December 2001
Notes Six months ended 31 Six months ended 31 Year ended
December 2001 December 2000 30 June 2001
(Unaudited) (Unaudited) (Audited)
£000's £000's £000's
Cash flow from operating
activities 5 680 209 89
Returns on investments and
servicing of finance 43 3 38
Taxation (183) - (154)
Capital expenditure (464) (3) (155)
Equity dividends paid - (33) (33)
Acquisitions (4,155) - -
Cash (outflow)/inflow before (4,079) 176 (215)
financing
FINANCING:-
Issue of shares (net of costs) 4,351 - 1,987
Loans repaid on acquisition 1,088 - -
Cash acquired 483 - -
Increase in cash in the period 1,843 176 1,772
Net funds at the beginning of 2,391 619 619
Net funds at the end of the 4,234 795 2,391
Statement of Total Recognised Gains and Losses
For the six months ended 31 December 2001
Six months ended Six months ended 31 Year ended
31 December 2001 December 2000 30 June 2001
(Unaudited) (Unaudited) (Audited)
£000's £000's £000's
Profit for the financial period 192 344 478
Exchange adjustments 138 - -
Total recognised gains and 330 344 478
losses
Notes to the Interim Accounts:
For the six months ended 31 December 2001
1. Basis of preparation
The financial information contained in this interim report does not constitute
statutory accounts within the meaning of Section 240 of the Companies Act 1985.
The interim financial information has been prepared on the basis of the
accounting policies set out in the Group's statutory accounts for the year ended
30 June 2001. In addition the Group has adopted Financial Reporting Standard
10, Goodwill and Intangible Assets. Purchased goodwill arising on consolidation
in respect of acquisitions made in the period is capitalised and amortised to
nil over its useful economic life.
The figures for the six months ended 31 December 2001 and the six months ended
31 December 2000 are unaudited. The figures for the year ended 30 June 2001
have been extracted from the statutory accounts filed with the Registrar of
Companies which contained an unqualified audit report and no adverse statement
under Section 237(2) or (3) of the Companies Act 1985.
2. Tax charge
The charge for taxation is based on the estimated effective rate for the year as
a whole.
The tax charge for the period consists of UK taxation of £102,000 (six months
ended 31 December 2000: £172,000, year ended 30 June 2001 £237,000) and overseas
taxation of £72,000 (six months ended 31 December 2000: £nil, year ended 30 June
2001: £nil).
3. Dividend
The directors have not declared an interim dividend.
4. Earnings per share
The calculations of earnings per share are based on the following profits and
numbers of shares:
The adjusted earnings per share is based on profit after tax before the goodwill
amortisation charge.
Six months ended Six months ended Year ended
31 December 2001 31 December 2000 30 June 2001
(Unaudited) (Unaudited) (Audited)
£000's £000's £000's
Number Number Number
Weighted average number of 0.25 pence ordinary
shares in issue during the period
For basic earnings per share 44,247,826 18,650,000 21,090,959
Exercise of share options 2,500,000 - 248,219
For diluted earnings per share 46,747,826 18,650,000 21,339,178
Profit for the financial period £000's £000's £000's
Profit for adjusted earnings per share 845 344 478
Adjustment for goodwill amortisation (653) - -
Profit for earnings per share 192 344 478
The comparative weighted average number of shares in issue has been adjusted to
reflect the subdivision of authorised share capital in December 2000 from £1
ordinary shares to shares of 0.25 pence each and the bonus issue of shares made
during the year ended 30 June 2001
5. Reconciliation of operating profit to net operating cash flow
Six months ended Six months ended Year ended
31-Dec-01 31-Dec-0000 30-Jun-01
(Unaudited) (Unaudited) (Audited)
£000's £000's £000's
Operating profit 323 513 678
Depreciation 37 8 23
Amortisation of goodwill 653
Profit on disposal (1)
(Increase) in debtors (411) (228) (559)
(Decrease) in creditors 79 (84) (53)
Net cash flow from operating activities 680 209 89
6. Reconciliation of movement in shareholders' funds
Six months ended Six months ended Year ended
31-Dec-01 31-Dec-00 30-Jun-01
(Unaudited) (Unaudited) (Audited)
£000's £000's £000's
Profit for the financial period 192 344 478
Foreign exchange adjustment 138 - -
Dividends - - (37)
330 344 441
New share capital subscribed net of costs 12,585 - 2,024
Increase in shareholders' funds 12,915 344 2,465
Opening shareholders' funds 2,967 502 502
Closing shareholders' funds 15,882 846 2,967
Shareholders' funds are entirely attributable to equity interests.
7. Acquisitions
Total Ian Elliott FIMO
£000's £000's £000's
Cash paid 3,995 185 3,810
Shares issued 8,325 - 8,325
Deferred consideration 3,221 220 3,001
Costs 230 67 163
15,771 472 15,299
Net assets (2,997) - (2,997)
Fair value adjustment 36 - 36
Goodwill arising 12,810 472 12,338
Goodwill amortisation (653) (39) (614)
Net book value 12,157 433 11,724
8. Interim Report
Copies of this interim report are being sent to all shareholders and will be
available to the public at the Company's registered office, First Artist House,
87 Wembley Hill Road, Wembley, Middlesex HA9 8BU for at least one month, free of
charge.
This information is provided by RNS
The company news service from the London Stock Exchange
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