Half Yearly Report
07 December 2010 - 10:00PM
UK Regulatory
TIDMTOU
RNS Number : 4966X
Touch Group PLC
07 December 2010
TOUCH GROUP PLC
('Touch' or 'the Group')
Interim Report for the Six Months Ended 30 September 2010
Touch Group plc, the international business-to-business publishing group, today
announces its unaudited interim results for the six-month period ended 30
September 2010
Highlights
· Turnover down 6% GBP2,689,000 (GBP2,870,000)
· Trading loss* reduced by 31% GBP471,000 (GBP686,000)
· Operating loss reduced by 49% GBP471,000 (GBP916,000)
· Gross Margins increased to 54.7% (44.5%)
· Orders Carried Forward up 10% GBP2,543,000 (GBP2,319,000)
· Continued focus on a balanced range of revenue streams
Note: comparators for 6 months to 30 September 2009
* "Trading loss" refers to operating loss before the impact of investment
impairments, fixed asset impairments, share based payment charges and credits
and other operating income.
Chairman's Statement
It is encouraging to see that operating losses were reduced by 49%. The strength
of our team has driven these challenging changes through.
Our strategy, which is firmly in place, is designed to achieve profitability.
However, to achieve our goals we still need to generate more revenue and at the
same time maintain our gross profit margins.
Stuart Winship, our CEO, and his managers are fully credited with building a
team that is becoming acknowledged and recognised as a "knowledge provider" to
the pharmaceutical industry. Our targeted areas of Medical Communications,
Online, Medical Content Research, for the Pharmaceutical Device and Diagnostic
Industries are gathering momentum. The focus on improving margins is beginning
to show results. Gross margins improved to 54.7% due to a combination of
increased digital distribution of the journals and greater online margins. Our
bespoke medical communications product, which is a highly tailored set of core
solutions in four key areas that include Medical Publications, Education
Materials, Medical Publishing and Online Solutions, generates high gross and
operating margin. Further, repeat business is making an increasingly important
contribution to our turnover figure, and we expect this to continue going
forward. We are working hard to increase volume.
We are going forward with an increasing pipeline of high value and strategic
opportunities which are starting to be fulfilled. This includes the expansion of
the R&D Pharma Publications and Digital offerings. Whilst our portfolio of
online sites currently stands at 8, it is intended that this will be extended as
quickly as we can to cover all the major 'ologies, thereby providing a
comprehensive range. We are confident we have the right products, reinforced by
positive feedback from our customers, but market outlook remains difficult so
management focus will also be on conserving cash and maintaining tight control
over costs.
The value of building our digital archive library is starting to pay off. Last
financial year we sold GBP630,000 of reprints both in print and on line from our
archive library. This year we should achieve nearly one million in revenue.
The margins of this business are high because commissioning costs were met when
content was originated.
"TORQUE"
"DEFINITION: FORCE FROM EVERY DIRECTION"
2007 -2010
We have developed from a contract publisher with revenue from advertising to a
publisher of medical and energy journals again funded by advertising.
We moved from this platform by building relationships with key opinion leaders
in the medical world and providing original content for our journals and seeking
financial grants from the medical foundations of the larger pharma companies to
support our content.
We then provided content coupled with advertising in print and online. Going
forward from this base and with the establishment of our own team of 10 medical
writers we are now becoming regarded as a provider of knowledge and content on
line and in print and bespoke and we are working in close association with major
medical groups across the world, of course, not ignoring advertising
opportunities.
All of this against a background of financial pessimism and depression.
We have now arrived at our destination. We have coped with Torque.
The challenge is building our revenues.
For further information please contact:
Touch Group PLC
Vincent Isaacs
Executive Chairman Tel: 020 7452
5222
Shore Capital and Corporate Limited
Nominated Adviser to the Company
Andrew Raca/Edward Mansfield Tel: 020 7468 7923
Trading Review
+-----------------------+----------+--------------+----------+----------------+
| | | Six months | | Six months |
| | | ended | | ended |
| | | 30 September | | 30 September |
| | | 2010 | | 2009 |
+-----------------------+----------+--------------+----------+----------------+
| Clinical publications | | GBP1,871,000 | | GBP1,915,000 |
| | | | | |
+-----------------------+----------+--------------+----------+----------------+
| Energy publications | | GBP160,000 | | GBP281,000 |
+-----------------------+----------+--------------+----------+----------------+
| Barter revenues | | GBP285,000 | | GBP414,000 |
+-----------------------+----------+--------------+----------+----------------+
| Medical | | GBP373,000 | | GBP260,000 |
| communications | | | | |
+-----------------------+----------+--------------+----------+----------------+
| Total Turnover | | GBP2,689,000 | | GBP2,870,000 |
+-----------------------+----------+--------------+----------+----------------+
The revenue breakdown shows that the clinical publications revenues remain at
similar levels to the prior year. Energy as a division of publications was
down due to one journal being deferred into the second half in order to coincide
with a major event. Barter revenues (non cash) were reduced due to more media
partnerships being actioned online. Medical communications revenues (including
online projects) were up by 44% reflecting the expanding initiatives in this
area.
Gross margins improved to 54.7% due to a combination of increased digital
distribution of the journals and greater online margins. Administrative
expenses remained level at GBP1.9 million and unlike prior year there was no
impairment (2009 - GBP230,000). The resulting operating loss of GBP478,000
represents a 45% reduction on the prior period loss (2009 - GBP874,000).
As of 30th September 2010 the group had cash at bank of GBP86,000 and
availability to draw down a further GBP350,000 under the invoice financing
facility.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
+----------------------------------+-----+-----------+----------+-----------+----------+---------+
| | | Unaudited | | Unaudited | | Audited |
| | | Six | | Six | | 15 |
| | | months | | months | | months |
| | | ended | | ended | | ended |
| | | 30 | | 30 | | 31 |
| | | September | | September | | March |
| | | 2010 | | 2009 | | 2010 |
+----------------------------------+-----+-----------+----------+-----------+----------+---------+
| | | GBP'000 | | GBP'000 | | GBP'000 |
+----------------------------------+-----+-----------+----------+-----------+----------+---------+
| CONTINUING OPERATIONS | | | | | | |
+----------------------------------+-----+-----------+----------+-----------+----------+---------+
| Revenue | | 2,689 | | 2,870 | | 5,692 |
+----------------------------------+-----+-----------+----------+-----------+----------+---------+
| Cost of sales | | (1,219) | | (1,592) | | (2,712) |
+----------------------------------+-----+-----------+----------+-----------+----------+---------+
| GROSS PROFIT | | 1,470 | | 1,278 | | 2,980 |
+----------------------------------+-----+-----------+----------+-----------+----------+---------+
| Administrative expenses | | (1,948) | | (1,922) | | (4,857) |
+----------------------------------+-----+-----------+----------+-----------+----------+---------+
| Other operating | | - | | (230) | | (267) |
| expenses-impairment | | | | | | |
+----------------------------------+-----+-----------+----------+-----------+----------+---------+
| OPERATING LOSS | | (478) | | (874) | | (2,144) |
+----------------------------------+-----+-----------+----------+-----------+----------+---------+
| Investment revenue | | 13 | | - | | 3 |
+----------------------------------+-----+-----------+----------+-----------+----------+---------+
| Finance costs | | (6) | | (42) | | (57) |
+----------------------------------+-----+-----------+----------+-----------+----------+---------+
| LOSS BEFORE TAX | | (471) | | (916) | | (2,198) |
+----------------------------------+-----+-----------+----------+-----------+----------+---------+
| Tax | | - | | - | | - |
+----------------------------------+-----+-----------+----------+-----------+----------+---------+
| LOSS FOR THE PERIOD | | (471) | | (916) | | (2,198) |
+----------------------------------+-----+-----------+----------+-----------+----------+---------+
| There is no other profit or loss for the period, therefore the comprehensive loss for |
| the period is GBP471,000 (GBP916,000) |
+------------------------------------------------------------------------------------------------+
| LOSS PER SHARE | | Pence | | Pence | | Pence |
+----------------------------------+-----+-----------+----------+-----------+----------+---------+
| Basic | | (0.3) | | (0.8) | | (1.7) |
+----------------------------------+-----+-----------+----------+-----------+----------+---------+
| Diluted | | (0.3) | | (0.8) | | (1.7) |
+----------------------------------+-----+-----------+----------+-----------+----------+---------+
All of the articles are clarified as continuing.
CONSOLIDATED BALANCE SHEET
+---------------------------------+-----+-----------+----------+---------+
| | | Unaudited | | Audited |
| | | As at | | As at |
| | | 30 | | 31 |
| | | September | | March |
| | | 2010 | | 2010 |
+---------------------------------+-----+-----------+----------+---------+
| | | GBP'000 | | GBP'000 |
+---------------------------------+-----+-----------+----------+---------+
| NON-CURRENT ASSETS | | | | |
+---------------------------------+-----+-----------+----------+---------+
| Intangible assets | | 267 | | 343 |
+---------------------------------+-----+-----------+----------+---------+
| Property, plant and equipment | | 810 | | 868 |
+---------------------------------+-----+-----------+----------+---------+
| Investments | | 18 | | 18 |
+---------------------------------+-----+-----------+----------+---------+
| | | 1,095 | | 1,229 |
+---------------------------------+-----+-----------+----------+---------+
| CURRENT ASSETS | | | | |
+---------------------------------+-----+-----------+----------+---------+
| Inventories | | 442 | | 337 |
+---------------------------------+-----+-----------+----------+---------+
| Trade and other receivables | | 1,843 | | 1,374 |
+---------------------------------+-----+-----------+----------+---------+
| Cash and cash equivalents | | 86 | | 993 |
+---------------------------------+-----+-----------+----------+---------+
| | | 2,371 | | 2,704 |
+---------------------------------+-----+-----------+----------+---------+
| TOTAL ASSETS | | 3,466 | | 3,933 |
+---------------------------------+-----+-----------+----------+---------+
| | | | | |
+---------------------------------+-----+-----------+----------+---------+
| CURRENT LIABILITIES | | | | |
+---------------------------------+-----+-----------+----------+---------+
| Trade and other payables | | (1,423) | | (1,322) |
+---------------------------------+-----+-----------+----------+---------+
| Borrowings | | (245) | | (260) |
+---------------------------------+-----+-----------+----------+---------+
| | | (1,668) | | (1,582) |
+---------------------------------+-----+-----------+----------+---------+
| | | | | |
+---------------------------------+-----+-----------+----------+---------+
| NET CURRENT ASSETS | | 703 | | 1,122 |
+---------------------------------+-----+-----------+----------+---------+
| | | | | |
+---------------------------------+-----+-----------+----------+---------+
| NON-CURRENT LIABILITIES | | | | |
+---------------------------------+-----+-----------+----------+---------+
| Obligations under finance | | (5) | | - |
| leases | | | | |
+---------------------------------+-----+-----------+----------+---------+
| Other | | (638) | | (688) |
+---------------------------------+-----+-----------+----------+---------+
| Total liabilities | | (2,311) | | (2,270) |
+---------------------------------+-----+-----------+----------+---------+
| NET ASSETS | | 1,155 | | 1,663 |
+---------------------------------+-----+-----------+----------+---------+
| | | | | |
+---------------------------------+-----+-----------+----------+---------+
| EQUITY | | | | |
+---------------------------------+-----+-----------+----------+---------+
| Issued share capital | | 1,619 | | 1,619 |
+---------------------------------+-----+-----------+----------+---------+
| Share premium account | | 4,475 | | 4,475 |
+---------------------------------+-----+-----------+----------+---------+
| Other reserve | | 300 | | 300 |
+---------------------------------+-----+-----------+----------+---------+
| Retained loss | | (5,239) | | (4,731) |
+---------------------------------+-----+-----------+----------+---------+
| TOTAL EQUITY | | 1,155 | | 1,663 |
+---------------------------------+-----+-----------+----------+---------+
STATEMENT OF CONSOLIDATED CASH FLOWS
+-------------------------------------+-----------+----------+-----------+----------+---------+
| | Six | | Six | | Audited |
| | months | | months | | 15 |
| | ended | | ended | | months |
| | 30 | | 30 | | ended |
| | September | | September | | 31 |
| | 2010 | | 2009 | | March |
| | | | | | 2010 |
| | | | | | |
+-------------------------------------+-----------+----------+-----------+----------+---------+
| | | | GBP'000 | | GBP'000 |
+-------------------------------------+-----------+----------+-----------+----------+---------+
| | | | | | |
+-------------------------------------+-----------+----------+-----------+----------+---------+
| Cash flows from operating | (859) | | 206 | | 27 |
| activities | | | | | |
+-------------------------------------+-----------+----------+-----------+----------+---------+
| | | | | | |
+-------------------------------------+-----------+----------+-----------+----------+---------+
| Investing activities | | | | | |
+-------------------------------------+-----------+----------+-----------+----------+---------+
| Interest received | 13 | | - | | 3 |
+-------------------------------------+-----------+----------+-----------+----------+---------+
| Acquisition of plant, property and | (31) | | (61) | | (859) |
| equipment | | | | | |
+-------------------------------------+-----------+----------+-----------+----------+---------+
| Compensation received for | - | | - | | 820 |
| relocation | | | | | |
+-------------------------------------+-----------+----------+-----------+----------+---------+
| Acquisition of intangible assets | - | | (36) | | (84) |
+-------------------------------------+-----------+----------+-----------+----------+---------+
| Net cash used in investing | (18) | | (97) | | (120) |
| activities | | | | | |
+-------------------------------------+-----------+----------+-----------+----------+---------+
| | | | | | |
+-------------------------------------+-----------+----------+-----------+----------+---------+
| Financing activities | | | | | |
+-------------------------------------+-----------+----------+-----------+----------+---------+
| Interest and similar expenses paid | (7) | | (50) | | (57) |
+-------------------------------------+-----------+----------+-----------+----------+---------+
| Repayment of borrowings | (15) | | 5 | | (190) |
+-------------------------------------+-----------+----------+-----------+----------+---------+
| Invoice debt finance | - | | - | | (244) |
| acquired/(repaid) | | | | | |
+-------------------------------------+-----------+----------+-----------+----------+---------+
| Finance lease borrowings acquired | - | | - | | - |
+-------------------------------------+-----------+----------+-----------+----------+---------+
| Repayment of obligations under | (8) | | - | | (15) |
| finance leases | | | | | |
+-------------------------------------+-----------+----------+-----------+----------+---------+
| New shares issued | - | | - | | 1,061 |
+-------------------------------------+-----------+----------+-----------+----------+---------+
| Net cash from financing activities | (30) | | (45) | | 555 |
+-------------------------------------+-----------+----------+-----------+----------+---------+
| | | | | | |
+-------------------------------------+-----------+----------+-----------+----------+---------+
| Net increase/(decrease) in cash and | (907) | | 64 | | 462 |
| cash equivalents | | | | | |
+-------------------------------------+-----------+----------+-----------+----------+---------+
| Cash and cash equivalents at | 993 | | 194 | | 531 |
| beginning of period | | | | | |
+-------------------------------------+-----------+----------+-----------+----------+---------+
| Cash and cash equivalents at period | 86 | | 258 | | 993 |
| end | | | | | |
+-------------------------------------+-----------+----------+-----------+----------+---------+
NOTES TO THE INTERIM FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING POLICIES
These accounts comply with relevant accounting standards and have been prepared
on a consistent basis using the accounting policies set out in the Annual Report
and Accounts for the 15 months ended 31 March 2010.
2. NATURE OF INFORMATION
The interim accounts for the six months ended 30 September 2010 and the
comparative figures for the six months ended 30 September 2009 have not been
audited by the Company's auditors.
The financial statements for the 15 months ended March 2010 have been reported
on by the Company's auditors and delivered to the Registrar of Companies. The
report of the auditors on such accounts was unqualified and did not contain any
statement under sections 237(2) or 237(3) of the Companies Act 1985.
3. LOSS PER SHARE
The calculation of the basic and diluted earnings per share is based on the
following data:
+------------------------------+--+-------------+----------+-------------+----------+-------------+
| | | Unaudited | | Unaudited | | Audited |
| | | Six | | Six | | 15 |
| | | months | | months | | months |
| | | ended | | ended | | ended |
| | | 30 | | 30 | | 31 |
| | | September | | September | | March |
| | | 2010 | | 2009 | | 2010 |
| | | | | | | |
+------------------------------+--+-------------+----------+-------------+----------+-------------+
| | | GBP'000 | | GBP'000 | | GBP'000 |
+------------------------------+--+-------------+----------+-------------+----------+-------------+
| Earnings: | | | | | | |
+------------------------------+--+-------------+----------+-------------+----------+-------------+
| Earnings for the purposes of | (471) | | (916) | | (2,198) |
| basic and diluted earnings per | | | | | |
| share | | | | | |
+---------------------------------+-------------+----------+-------------+----------+-------------+
| | | | | | | |
+------------------------------+--+-------------+----------+-------------+----------+-------------+
| Number of shares: | | Shares | | Shares | | Shares |
+------------------------------+--+-------------+----------+-------------+----------+-------------+
| Weighted average number of | | 161,858,588 | | 117,858,588 | | 127,961,378 |
| shares for the purposes of | | | | | | |
| basic and diluted earnings | | | | | | |
| per share | | | | | | |
+------------------------------+--+-------------+----------+-------------+----------+-------------+
| |
| Some options granted to employees could potentially dilute basic earnings per |
| share in the future, but were not included in the calculation of diluted |
| earnings per share as they are anti dilutive for the period presented. |
| |
+------------------------------+--+-------------+----------+-------------+----------+-------------+
4. NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT
+---------------------------------+-----------+----------+-----------+----------+---------+
| | 6 | | 6 | Audited |
| | months | | months | 15 months ended |
| | ended | | ended | 31 March |
| | 30 | | 30 | 2010 |
| | September | | September | |
| | 2010 | | 2009 | |
+---------------------------------+-----------+----------+-----------+--------------------+
| | GBP'000 | | GBP'000 | | GBP'000 |
+---------------------------------+-----------+----------+-----------+----------+---------+
| | | | | | |
+---------------------------------+-----------+----------+-----------+----------+---------+
| Operating loss for the period: | (478) | | (874) | | (2,144) |
+---------------------------------+-----------+----------+-----------+----------+---------+
| | | | | | |
| Adjustments for: | | | | | |
+---------------------------------+-----------+----------+-----------+----------+---------+
| Depreciation of property, plant | 89 | | 81 | | 195 |
| and equipment | | | | | |
+---------------------------------+-----------+----------+-----------+----------+---------+
| Amortisation of intangibles | 77 | | 65 | | 166 |
+---------------------------------+-----------+----------+-----------+----------+---------+
| Impairment | - | | - | | 230 |
+---------------------------------+-----------+----------+-----------+----------+---------+
| Share based payment | - | | - | | - |
| charge/(credit) | | | | | |
+---------------------------------+-----------+----------+-----------+----------+---------+
| Operating cash flows before | | | | | |
| movements in working capital | (312) | | (728) | | (1,553) |
+---------------------------------+-----------+----------+-----------+----------+---------+
| Increase in inventories | (105) | | 171 | | (25) |
+---------------------------------+-----------+----------+-----------+----------+---------+
| Reduction/(Increase) in | (978) | | 1,243 | | 2,027 |
| receivables | | | | | |
+---------------------------------+-----------+----------+-----------+----------+---------+
| Decrease in payables | 535 | | (480) | | (422) |
+---------------------------------+-----------+----------+-----------+----------+---------+
| Net cash from operating | (859) | | 206 | | 27 |
| activities | | | | | |
+---------------------------------+-----------+----------+-----------+----------+---------+
5. AVAILABILITY OF ACCOUNTS
Copies of these interim results are available from Touch Group plc, Saffron
House, 6-10 Kirby Street, London EC1N 8TS. Alternatively a downloadable version
is available from the
following web address: www.touchbriefings.com/reports.htm.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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