TIDMWFCA
9 February 2009
Correction to the PRNewswire released this morning to correct the EPS figures
WFCA plc
("WFCA", "the Company" or "the Group")
INTERIM RESULTS
WFCA plc (AIM: WFCA.L), a leading regional advertising and marketing agency,
today announces its interim results for the 6 months ended 31 December 2008.
Highlights
* Gross margin for period increased to 17.9% (2007 H1: 7.8%)
* PBT (before exceptional credit and tax) GBP509k (2007 H1: GBP139k)
* Working capital has improved by GBP847,000
Further enquiries:
WFCA plc
Stephen Latter, Financial Director Tel: 01892 511 085
Daniel Stewart & Company plc
Simon Leathers/Oliver Rigby Tel: 020 7776 6550
Chairman's Statement
In the business review included in the 2008 annual report we drew attention to
the evolving strength of the Group following the acquisition of WFCA Integrated
Limited in April last year. The acquisition has materially enhanced the Group's
profitability and we are pleased to announce that the profit before the
exceptional credit and tax for the six months amounted to GBP509,000 compared to
GBP139,000 for the comparable period in the last financial year and GBP91,000 for
the year to June 2008. Gross margin has increased to 17.9% from the 7.8%
reported for last year. The significance of WFCA to the Group has been formally
recognised in the change of the Group's name from Ekay plc to WFCA plc on the
11th December 2008.
The result has been achieved by making strong operational and financial
decisions during the period. In the current economic climate it is essential
that all divisions are cash generative and their underlying cost base
structured to the present economic conditions.
In the last report we drew attention to the difficulties being experienced in
our Channel Islands division, Wallace Barnaby Associates, which necessitated
the full impairment of the investment at the 30th June 2008. Regrettably it was
not possible to restructure the division to a profitable level and as a
consequence, the decision was made in October to place the division into
liquidation. The liquidation of Wallace Barnaby has produced an exceptional
credit as a result of the de recognition of its negative net worth from the
consolidated balance sheet.
The impact of the Wallace Barnaby liquidation together with the enhanced
profitability of the Group has been to materially improve the Group's net
worth. Working capital has improved by GBP847,000 and should continue to improve
in the second six months of the current financial year. As the conditions
specified within the approval given by the High Court last June for the capital
reduction have now been satisfied, the Special Reserve has been transferred to
distributable reserves to facilitate the payment of future dividends.
Board changes
There have been two board changes since the last annual report. Bill Jones,
WFCA's media director joined the board in December 2008 and Eddie Powell, the
founder and Managing Director of the Ekay Group left the board on the 28th
January 2009 to concentrate on other interests. The board wishes to thank Eddie
for his long association with the Group and wishes him every success in the
future.
Current trading and future prospects
Looking ahead the business environment continues to be challenging and we
anticipate a tough second half. However, tight control of operating costs and
new business development should ensure that the Group remains profitable and
well placed to navigate through the current recession and move ahead when the
economic climate improves.
CONSOLIDATED INCOME STATEMENT
For the 6 months ended 31 December 2008
6 Months Ended 6 Months Ended 12 Months Ended
31st Dec 2008 31st Dec 2007 30th June 2008
Unaudited Unaudited Audited
Revenue 19,301,659 23,131,776 44,474,052
Direct Costs (15,853,548) (21,233,441) (41,022,308)
Gross Profit 3,448,111 1,898,335 3,451,744
Other operating income 4,500 4,350 22,604
Operating costs before share (2,888,368) (1,689,062) (3,338,285)
option and release of
provision
Share option credit / (10,534) (43,988) 17,131
(charge)
Total operating costs (2,898,902) (1,733,050) (3,321,154)
Depreciation (44,399) (57,202) (116,858)
Total operating profit 509,310 112,433 36,336
Interest income - 26,500 54,670
Profit before taxation 509,310 138,933 91,006
Income tax (charge) / credit (142,756) (41,590) 54,456
Profit before exceptional 366,554 97,343 145,462
items and discontinued
operations
Profit / (loss) from - 80,500 (3,237,609)
exceptional items
Profit from discontinued 350,539 - -
operations
Profit for the year 717,093 177,843 (3,092,147)
attributable to equity
holders of the parent
Earnings per share
Basic earnings / (loss) per 0.23p 0.45p (4.62)p
share
Diluted earnings / (loss) 0.23p 0.44p (4.62)p
per share
CONSOLIDATED BALANCE SHEET
as at 31 December 2008
As at 31st Dec As at 31st Dec As at 30th June
2008 2007 2008
Unaudited Unaudited Audited
Assets
Non Current Assets
Property, Plant and 338,910 433,132 470,746
Equipment
Goodwill 8,497,907 2,399,815 8,497,907
8,836,817 2,832,947 8,968,653
Current Assets
Trade and Other 7,429,047 3,329,345 7,636,070
Receivables
Cash & Short Term Deposits 302,684 397,997 757,249
Depreciation 7,731,731 3,727,342 8,393,319
Total operating profit
Total Assets 16,568,547 6,560,289 17,361,972
Equity and Liabilities
Share Capital 1,572,476 391,309 1,568,088
Share Premium 5,015 718,579 -
Special Reserve - - 6,499,126
Retained Earnings 3,169,115 (719,975) (4,051,085)
4,746,606 389,913 4,016,129
Non Current Liabilities
Long Term Borrowings 1,015,288 - 1,030,983
Current Liabilities
Trade & Other Payables 10,806,653 6,149,501 12,011,838
Provision for other - - 302,202
liabilities
Corporate income tax - 20,875 820
payable.
Total liabilities 11,821,941 6,170,376 13,345,843
Total equity & liabilities 16,568,547 6,560,289 17,361,972
CONSOLIDATED CASH FLOW STATEMENT
For the 6 months ended 31 December 2008
6 Months 6 Months 12 Months
Ended Ended Ended
31st Dec 2008 31st Dec 2007 30th June
2008
Unaudited Unaudited Audited
Cash inflow / (loss) from operating
activities
Profit / (loss) from operations 859,849 227,434 (3,201,273)
Share option credit / (charge) for 10,534 43,988 (17,131)
the year
Impairment of investment in - - 2,386,462
subsidiary
Impairment of property, plant & - - 41,205
equipment
Depreciation of property, plant & 49,597 57,202 116,857
equipment
Operating cash flows before movement 919,980 328,624 (673,880)
in working capital
Depreciation 135,638 - 60,989
Total operating profit 26,014 (432,223) 772,621
Increase / (decrease) in payables (3,610,390) (1,696,320) (2,554,241)
Cash (consumed) / generated from (2,528,758) (1,799,919) (2,394,511)
operations
Income tax received / (paid) 16,344 - 33,263
Net cash from operating activities (2,512,414) (1,799,919) (2,361,248)
Cash inflow / (outflow) from
investing activities
Interest received - 26,500 54,670
Acquisition of subsidiaries net of - (13,353) (2,417,593)
cash acquired
Proceeds from sale of property, plant - - 29,887
& equipment
Purchase of property, plant and (53,499) (56,616) (115,016)
equipment
Net cash used in investment (53,499) (43,469) (2,448,052)
activities
Cash inflow from financing activities
Proceeds from issue of shares 9,403 - 2,521,326
Costs of share issues - - (64,000)
Costs of capital reduction (6,553) - -
Net cash from financing activities 2,850 - 2,457,326
Net (decrease) in cash & cash (2,563,063) (1,843,388) (2,351,974)
equivalents
Cash & cash equivalents at beginning (685,602) 1,666,372 1,666,372
of period
Cash & cash equivalents at end of (3,248,665) (177,016) (685,602)
period
Cash & Cash Equivalents as at 31st December 2008
Represented by;
Cash & short term deposits 302,684 397,997 757,249
Bank overdrafts (3,551,349) (575,013) (1,442,851)
Total cash & cash equivalents (3,248,665) (177,016) (685,602)
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the 6 months ended 31 December 2008
Share Share Special Retained
Capital Premium Reserve Earnings Total
GBP GBP GBP GBP GBP
Balances as at 1st July 1,568,088 - 6,499,126 (4,051,085) 4,016,129
2008
Charge for share options - - - 10,534 10,534
Issue of share capital 4,388 5,015 - - 9,403
Costs of creating Special - - (6,553) - (6,553)
Reserve
Transfer of Special - - (6,492,573) 6,492,573 -
Reserve
Profit for the six months - - - 717,093 717,093
ended 31st December 2008
Balances as at 31st 1,572,476 5,015 - 3,169,115 4,746,606
December 2008
This interim report is unaudited and does not constitute statutory financial
statements within the meaning of section 240 of the Companies Act 1985. The
financial statements for the year to 30th June, which were prepared in
accordance with International Financial Reporting Standards (`IFRS') and upon
which the auditors have issued an unqualified report, have been delivered to
the Registrar of Companies.
The financial statements for the half year to 31st December 2008 have been
prepared in accordance with IAS 34 `Interim Financial Reporting'. The
accounting policies applied in these interim financial statements are
consistent with those set out and applied in the Group's Annual report for the
year to 30th June 2008.
The financial information for the six months ended 31 December 2008 which
comprises the Consolidated Income Statement, Consolidated Balance Sheet,
Consolidated Cash Flow Statement, Consolidated Statement of Changes in Equity
and the related notes, has been reviewed by the Group's auditor. In addition,
the Group's auditor has read the other information contained in the interim
report and considered whether it contains any apparent misstatements or
material inconsistencies with the financial information.
The full Consolidated Statements and notes can be downloaded on the Company's
website www.wfca.co.uk
END
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