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RNS
Tarsus Group PLC  -  TRS   

Half-year Report

Released 07:00 26-Jul-2017

RNS Number : 0794M
Tarsus Group PLC
26 July 2017
 

 Tarsus Group plc

("Tarsus", the "Company" or the "Group")

 

Interim results for six months to 30 June 2017

 

 

Tarsus, the international business-to-business media group, reports significant progress.

The 'Quickening the Pace' strategy - to accelerate financial returns - continues to gain momentum

with a concerted drive to scale up the Group's portfolio delivering strong organic revenue growth.

 

Highlights

 

·      Strong growth in adjusted profits and earnings

 

·      Like-for-like revenue* up 4% in smaller first half (8% excluding Turkey)

 

·      Interim dividend up 11% to 3.0p (2016: 2.7p)

 

·      Continuing strong visitor growth up 8%

 

·      Encouraging performances from recent acquisitions - Connect, Hometex and Intex

 

·      Acceleration of replication programme

 

·      Award winning - AEO Marketing Campaign of the Year (fifth time) and IAEE International Excellence Award

 

Six months to 30 June


2017

2016

2015*

Revenue (£'m)

39.8

27.0

29.0

Adjusted profit before tax* (£'m)

6.8

4.0

5.1

Loss before tax (£'m)

(1.4)

(3.1)

(2.2)

Adjusted EPS* (p)

3.5

2.8

3.1

EPS (p)

(3.2)

(3.1)

(3.0)

Interim dividend per share (p)

3.0

2.7

2.5

Operating cash inflow (£'m)

16.1

1.1

9.5

Net debt (£'m)

85.3

57.3

43.5

 

Outlook

 

·      Promising outlook for larger events in second half, including the Dubai Airshow and Labelexpo Europe

 

·      Forward bookings for the full year currently 9% ahead on a like-for-like basis

 

·      Group remains confident of delivering a strong performance in 2017 in line with expectations

 

Douglas Emslie, Group Managing Director, said:

 

"2017 is set to be a strong year for Tarsus. Our determination to build a high quality portfolio in fast-growth markets is paying off, with recent acquisitions performing well and replications extending the reach of Tarsus brands across the world.

 

"We are seeing impressive results across the portfolio, thanks to the Group's clear strategy of driving scale and momentum. We acquire businesses in exciting markets and industries on the cusp of change; we partner with entrepreneurs who share our vision; we replicate these success stories across the world. Thanks to our increasing scale, we are positioned to deliver future growth - Quickening the Pace of returns to our shareholders.

 

"As we look ahead to the next six months, the picture is bright. Forward bookings for the current year are already 9% ahead - and we are expecting strong editions of our largest shows, notably Labelexpo Europe and the Dubai Airshow. Given the progress made in 2017, and our excellent portfolio, the Group is confident of delivering a strong performance for the year as a whole."

 

Overview

 

The past five years have seen a major strategic re-shaping of the Tarsus portfolio, with a number of strong brands acquired and the Group's ambitions focused on geographies which promise significant growth. The portfolio of exhibitions is diversified by both geography and sector, from the emerging markets of Dubai, Turkey, South East Asia and Mexico to the world-leading markets of the US and China, Tarsus has laid the foundations for future progress.

 

Following this period of expansion, Tarsus now enjoys the scale and reach to build momentum rapidly: anchored in key markets, with the dexterity and drive to replicate leading brands worldwide. The company continues to invest in new innovations and products, with a constant eye on increasing future organic growth. Together, these actions allow the Group to fulfil its strategy of 'Quickening the Pace': constantly accelerating the rate of return to shareholders.

 

Financial review

 

Group revenue for the period was £39.8m (2016: £27.0m). Adjusting for acquisitions and biennial events, underlying organic revenue growth of 4% was achieved in the smaller first half. Revenues in Turkey in the first half were impacted by the geopolitical uncertainty in the region; excluding this impact the revenue growth for the group was 8% on a like-for-like basis.

 

Adjusted profit before tax was £6.8m (2016: £4.0m; 2015: £5.1m), reflecting strong revenue growth in the portfolio as a result of the move towards higher growth markets and a strong performance from acquisitions. The Group incurred exceptional costs of £0.6m (2016: £0.8m) in respect of completed and pending corporate transactions. The Group also incurred an amortisation charge of £3.7m (2016: £2.5m). Other adjusting items are set out in note 6 to the financial statements below. Loss before tax was £1.4m (2016: £3.1m).

 

Adjusted earnings per share were 3.5p (2016: 2.8p). Basic loss per share was 3.2p (2016: 3.1p).

 

An interim dividend of 3.0p per share (2016: 2.7p) has been declared and will be paid on 12 January 2018 to Shareholders on the Register on 1 December 2017. The Group will continue to offer a scrip alternative to qualifying shareholders.

 

Operating cash inflow in the first half was £16.1m (2016: £1.1m), a strong performance ahead of the Group's large biennial shows in the second half of the year. As expected net debt at 30 June 2017 increased to £85.3 million (2016: £57.3m), driven primarily by acquisitions and deferred consideration payments. The Group remains on target to return to its stated long-term target range of 1.5 - 2.0x net debt: EBITDA by the end of the year. Tarsus has bank facilities of £111m to 2020, providing the financial resources to support its strategic development.

 

Corporate activity

 

Tarsus completed the acquisition of 65% of Foshan Huaxia Home Textile Development Co., Ltd on 25 January 2017.

 

There were no other acquisitions or disposals during the period.

 

Operating review

 

Geographic breakdown of results

 

The Group has changed its reporting structure to better reflect the geographic management of the businesses. Previously the Group reported under US, Europe and Emerging Markets. The segments are now Americas (US and Latin America), Asia (China and South East Asia) and EMEA (Europe, Middle East and Turkey).

 


EMEA

Americas

Asia

£'m

2017

2016

2015

2017

2016

2015

2017

2016

2015

Revenue

10.5

7.1

11.1

16.3

12.2

9.9

13.1

7.7

8.0

Adjusted Profit before tax

2.2

0.5

2.1

3.0

4.3

2.9

5.0

1.9

2.3

Americas

 

The Connect events are second-half weighted and are performing in line with expectations. We are seeing good opportunities to expand the Connect portfolio with 10 new events planned this year. The Medical portfolio continues its return to revenue growth and the Off Price February 2017 show produced another solid performance.

 

In Mexico, trading was positive with a strong performance from Expo Manufactura. Two replications were also held (GESS Mexico and Airport Solutions) in the period and both did well.

 

Asia

 

The Group's Chinese portfolio, which is heavily first half weighted, performed strongly. AAITF showed good growth in its third edition in Shenzhen, and SIUF performed well. The first editions of events held under the Group's ownership of Hometex and Intex were all encouraging and in line with management expectations. The outlook for the second half in China remains positive.

 

The majority of events in South-East Asia fall in the second half of the year. Performance of the first half events was in line with management's expectations.

 

EMEA

 

Dubai saw a solid performance across events in the first half, including GESS: one of the key brands being replicated into other markets. The first edition in Turkey will take place in October 2017.

 

Given the unsettled political background, the Group budgeted cautiously for Turkey in 2017. Overall, a number of events in the first half saw lower revenues than previous editions. The market has now recovered resulting in an improved outlook for 2017 compared with 2016 for the Group's larger shows in the second half: Zuchex, Sign and Flower Show.

 

Outlook

 

Revenues for the year as a whole are heavily weighted to the second half, owing to the timing of the Group's larger events. Overall, bookings are 9% ahead of 2016 on a like-for-like basis - and Tarsus expects strong editions of the larger shows (notably Labelexpo Europe and the Dubai Airshow) in the second half.

 

Recent acquisitions are performing well, further enhancing the Group's organic growth potential through increased scale and additional replication opportunities.

 

The Group remains confident of delivering a strong performance for the year as a whole and in line with the Board's expectations.

  

 

Neville Buch

Douglas Emslie

Chairman

Group Managing Director

26 July 2017


 

For further information contact:

 

Tarsus Group plc:


Douglas Emslie, Group Managing Director

020 8846 2700

Dan O'Brien, Group Finance Director




IR Focus


Neville Harris

07909 976044



 

The Group will be hosting a presentation to analysts at 11.30am today at the offices of Investec Bank plc, 2 Gresham Street, London EC2V 7QP. A webcast of the presentation will be available on Tarsus's website (www.tarsus.com) from 9.30am on 27 July 2017.

 

*Definitions can be found in note 17 to the financial statements

 

CONDENSED CONSOLIDATED INTERIM INCOME STATEMENT

 



Period to 30 June 2017


Period to 30 June 2016





Unaudited






Unaudited




Note

Headline


Adjusting items *

Reported


Headline


Adjusting

items *

Reported



£000


£000


£000


£000


£000


£000



























Group revenue

7

39,777


-


39,777


26,954


-


26,954














Operating costs


(32,761)


(6,266)


(39,027)


(23,896)


(4,580)


(28,476)














Share of profit of joint ventures


1,703


(464)


1,239


2,020


(591)


1,429














Group operating profit/(loss)


8,719


(6,730)


1,989


5,078


(5,171)


(93)














Net finance costs


(1,928)


(1,429)


(3,357)


(1,113)


(1,888)


(3,001)














Profit/(loss) before taxation


6,791


(8,159)


(1,368)


3,965


(7,059)


(3,094)














Tax on profit/(loss) on ordinary activities

8

(1,091)


667


(424)


(604)


1,151


547














Profit/(loss) for the financial period


5,700


(7,492)


(1,792)


3,361


(5,908)


(2,547)














Attributable to:













Profit/(loss) for the financial period attributable to equity shareholders of the parent company

3,941


(7,492)


(3,551)


2,787


(5,908)


(3,121)














Profit for the financial period attributable to non-controlling interests

1,759


-


1,759


574


-


574
















5,700


(7,492)


(1,792)


3,361


(5,908)


(2,547)



























Note

Headline




Reported


Headline




Reported



























- basic

9

3.5




(3.2)


2.8




(3.1)

- diluted


3.5




(3.2)


2.7




(3.1)

 

* See note 6 for adjusting items


 

CONDENSED CONSOLIDATED INTERIM STATEMENT OF COMPREHENSIVE INCOME

 

For the six months ended 30 June

 



Period to 30 June 2017

Period to 30 June 2016



£000


£000



Unaudited


Unaudited






Loss for the financial period


(1,792)


(2,547)






Other comprehensive income/(expense) recognised directly in equity:





Cash flow hedge reserve - movement in fair value


525


(2,120)

Foreign exchange translation differences


(7,414)


8,379











Other comprehensive (expense)/income


(6,889)


6,259






Total comprehensive (expense)/income for the period


(8,681)


3,712






Attributable to:





Equity shareholders of the parent company


(10,440)


3,138

Non-controlling interests


1,759


574






Total comprehensive (expense)/income for the period


(8,681)


3,712






 


 

Other comprehensive income relating to foreign exchange translation differences, fair value movements in cash flow hedges and the tax effects thereon may all subsequently be reclassified to profit and loss if certain conditions are met.

CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITION


Note

At 30 June

        2017

At 30 June

       2016

At 31 December 2016



£000


£000


£000



Unaudited


Unaudited


Audited

NON-CURRENT ASSETS







Property, plant and equipment


1,241


958


1,355

Intangible assets

10

193,909


139,309


186,813

Investment in Joint Ventures


32,426


25,123


34,281

Other investments


-


1


1

Deferred tax assets


2,928


-


3,224










230,504


165,391


225,674

CURRENT ASSETS







Trade and other receivables


37,874


33,148


33,420

Cash and cash equivalents


26,996


8,708


15,946










64,870


41,856


49,366

CURRENT LIABILITIES







Trade and other payables


(38,360)


(18,211)


(33,357)

Deferred income


(50,311)


(37,143)


(35,790)

Provisions


(134)


-


(165)

Liabilities for current tax


(1,306)


-


(692)










(90,111)


(55,354)


(70,004)








NET CURRENT LIABILITIES


(25,241)


(13,498)


(20,638)








TOTAL ASSETS LESS CURRENT LIABILITIES


205,263


151,893


205,036








NON-CURRENT LIABILITIES







Other payables


(22,056)


(42,946)


(38,716)

Deferred tax liabilities


(10,918)


(9,168)


(10,881)

Interest bearing loans and borrowings


(111,000)


(63,500)


(83,800)










(143,974)


(115,614)


(133,397)








NET ASSETS


61,289


36,279


71,639








EQUITY







Share capital


5,650


5,117


5,637

Share premium account


73,200


49,164


72,304

Other reserves


(12,498)


(9,632)


(5,618)

Retained earnings


(9,388)


(11,832)


(3,047)

Issued capital and reserves attributable to equity shareholders of the parent

56,964


32,817


69,276








NON-CONTROLLING INTERESTS


4,325


3,462


2,363








TOTAL EQUITY


61,289


36,279


71,639

 

 

The financial statements of Tarsus Group plc, registered number 101579 (Jersey), were approved by the board and authorised for issue on 26 July 2017 and signed on its behalf by:

                                                                                                                                                                       

                                                                                                                                                                

Douglas Emslie                                                                          Daniel O'Brien

Group Managing Director                                                               Group Finance Director

 

 

 

 

CONDENSED CONSOLIDATED INTERIM STATEMENT OF CASH FLOWS 



Period to 30 June 2017

Period to 30 June 2016








Unaudited


Unaudited



£000


£000

Cash flows from operating activities





Loss for the period


(1,792)


(2,547)

Adjustments for:





Depreciation


269


176

Amortisation & impairment


4,642


3,225

Other gains / (losses)


(925)


185

Loss on disposal of intangible assets


-


1

Loss/(gain) on disposal of tangible assets


29


(4)

Share option charge


1,328


1,099

Taxation charge/(credit)


424


(547)

Interest payable


3,357


3,001

Share of profit from joint ventures


(1,239)


(1,429)

Dividends received from joint venture company


2,533


-






Operating cash flow before changes in working capital

8,626


3,160

Decrease/(increase) in trade and other receivables


1,100


(1,749)

Increase/(decrease) in trade and other payables


6,452


(278)

Decrease in provisions


(45)


-






Cash generated from operations


16,133


1,133

Interest paid


(1,802)


(1,199)

Income taxes received/(paid)


632


(206)






Net cash from operating activities


14,963


(272)






Cash flows from investing activities










Proceeds from sale of tangible fixed assets


-


2

Acquisition of property, plant & equipment


(191)


(45)

Acquisition of intangible fixed assets


(509)


(502)

Acquisition of subsidiaries (net of cash acquired)


(15,896)


(3,244)

Sale of French business


-


1,171

Deferred and contingent consideration paid


(5,938)


(4,979)

Put call option liability paid


(5,073)


-






Net cash outflow from investing activities


(27,607)


(7,597)






Cash flows from financing activities





Drawdown of borrowings


27,200


9,150

Share purchases for share based payments


-


(1,078)

Dividends paid to shareholders in parent company


(2,736)


(2,516)

Dividends paid to non-controlling interests in subsidiaries

(24)


(435)






Net cash inflow from financing activities


24,440


5,121






Net increase/(decrease) in cash and cash equivalents

11,796


(2,748)

Opening cash and cash equivalents


15,946


10,693

Foreign exchange movements


(746)


763






Closing cash and cash equivalents


26,996


8,708

 



CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY

 

   

                        



Attributable to equity holders of the parent















Share

Share

Reorgan-

Capital

Fair

Foreign

Retained

Non-

Total


Capital

Premium

isation

Redemption

Value

Exchange

Earnings

Controlling


Account

Reserve

Reserve

Reserve

Reserve

Reserve


Interests



£000

£000

£000

£000

£000

£000

£000

£000

£000











As at 1 January 2017

5,637

72,304

6,013

(443)

(2,434)

(8,754)

(3,047)

2,363

71,639

Recognised foreign exchange losses for the period

-

-

-

-

-

(7,405)

-

(9)

(7,414)

(Loss)/profit for the period:










- Attributable to equity shareholders

-

-

-

-

-

-

(3,551)

-

(3,551)

- Attributable to non-controlling interests

-

-

-

-

-

-

-

1,759

1,759

Cashflow hedge reserve

-

-

-

-

525

-

-

-

525

Total comprehensive income/(expense) for the period

-

-

-

-

525

(7,405)

(3,551)

1,750

(8,681)

Scrip dividend

-

14

-

-

-

-

-

-

14

New share capital subscribed

13

882

-

-

-

-

-

-

895

Share option charge

-

-

-

-

-

-

1,163

-

1,163

Movement in reserves relating to deferred tax

-

-

-

-

-

-

198

-

198

Other movements in reserves

-

-

-

-

-

-

(1,407)

-

(1,407)

Dividend paid

-

-

-

-

-

-

(2,744)

-

(2,744)

Acquisition of non-controlling interests

-

-

-

-

-

-

-

212

212

Net change in shareholders' funds

13

896

-

-

525

(7,405)

(6,341)

1,962

(10,350)

As at 30 June 2017

5,650

73,200

6,013

(443)

(1,909)

(16,159)

(9,388)

4,325

61,289
























Attributable to equity holders of the parent















Share

Share

Reorgan-

Capital

Fair

Foreign

Retained

Non-

Total


Capital

Premium

isation

Redemption

Value

Exchange

Earnings

Controlling


Account

Reserve

Reserve

Reserve

Reserve

Reserve


Interests



£000

£000

£000

£000

£000

£000

£000

£000

£000











As at 1 January 2016

5,091

48,280

6,013

(443)

(1,080)

(20,381)

(1,972)

4,424

39,932











Recognised foreign exchange gains for the period

-

-

-

-

-

8,379

-

-

8,379

Profit for the period:










- Attributable to equity shareholders

-

-

-

-

-

-

(3,121)

-

(3,121)

- Attributable to non-controlling interests

-

-

-

-

-

-

-

574

574

Cashflow hedge

-

-

-

-

(2,120)

-

-

-

(2,120)

Total comprehensive income (expense) for the period

-

-

-

-

(2,120)

8,379

(3,121)

574

3,712

Scrip dividend

1

14

-

-

-

-

-

-

15

New share capital subscribed

25

870

-

-

-

-

-

-

895

Share option charge

-

-

-

-

-

-

940

-

940

Movement in reserves relating to deferred tax

-

-

-

-

-

-

(2,763)

-

(2,763)

Other movements in reserves

-

-

-

-

-

-

(2,216)

-

(2,216)

Dividend paid

-

-

-

-

-

-

(2,540)

-

(2,540)

Dividend paid to non-controlling interests

-

-

-

-

-

-

-

(435)

(435)

Written Put options over non-controlling interests

-

-

-

-

-

-

(1,261)

-

(1,261)

Acquisition of non-controlling interests

-

-

-

-

-

-

1,101

(1,101)

-

Net change in shareholders' funds

26

884

-

-

(2,120)

8,379

(9,860)

(962)

(3,653)

As at 30 June 2016

5,117

49,164

6,013

(443)

(3,200)

(12,002)

(11,832)

3,462

36,279

 

 

 

 

 

 

 

 

 

                                                                                                                                     

 

 

 

 

 

 

 

 

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

 

1. REPORTING ENTITY

 

Tarsus Group plc (the "Company") is a company incorporated in Jersey and resident in Ireland. The condensed consolidated financial statements of the Company as at and for the six months ended 30 June 2017 comprise the Company and its subsidiaries (together referred to as the "Group") and the Group's interest in jointly controlled entities.

 

The consolidated financial statements of the Group as at and for the year ended 31 December 2016 are available upon request from the Company Secretary at 15 Harcourt Street, Dublin 2, Ireland.

 

Having reviewed the Group's liquid resources, borrowing facilities and cash flow forecasts, the directors believe that the Group has adequate resources to continue as a going concern for the foreseeable future.

 

2. STATEMENT OF COMPLIANCE

 

These condensed consolidated interim financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) IAS 34 Interim Financial Reporting. They do not constitute the Group's statutory accounts.

 

The interim financial statements should be read in conjunction with the consolidated financial statements of the Group as at and for the year ended 31 December 2016 which were prepared under International Financial Reporting Standards, as adopted by the European Union, and have been reported on by the Company's auditor. The auditor report was unqualified.

 

The financial statements of Tarsus Group plc, registered number 101579 (Jersey), were approved by the board and authorised for issue on 26 July 2017.

 

3. SIGNIFICANT ACCOUNTING POLICIES

 

The accounting policies applied by the Group in these condensed consolidated interim financial statements are the same as those applied by the Group in its consolidated financial statements as at and for the year ended 31 December 2016.   

 

4. ESTIMATES

 

The preparation of consolidation interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates.

 

In preparing these condensed consolidated interim financial statements, the significant judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial statements as at and for the year ended 31 December 2016.

 

5. FINANCIAL RISK MANAGEMENT

 

The Group's financial risk management objectives and policies are consistent with those disclosed in the consolidated financial statements as at and for the end for the year ended 31 December 2016.

  

 

6. ADJUSTING ITEMS

 

The following analysis details the adjusting items in the consolidated interim income statement. Adjusted profit is prepared to provide a better indication of overall financial performance and to reflect how the business is managed and measured on a day to day basis. The adjusted profit excludes share option charges, amortisation of intangible assets, unwinding of discount charges, changes in fair value of contingent consideration and put/call liabilities, acquisition related costs and related taxation impact.

 




Six months to

Six months to




30 June 2017

30 June 2016




£000


£000




Unaudited


Unaudited













Operating items:












Operating costs:






Acquisition and potential acquisition costs



650


813

Changes in fair value of put/call and contingent consideration


514


(636)

Movement in fair value of unsettled fx derivatives



-


816

Share option charge



1,328


1,099

Amortisation charge (excluding amounts charged to costs of sale)


3,745


2,493

Loss/(profit) on disposal of tangible fixed assets



29


(5)













Total adjusting items in operating costs



6,266


4,580

Tax on joint venture profits



464


591







Total adjusting items in operating profit



6,730


5,171







Finance item - Unwinding of discount



1,429


1,888







Adjusting items before tax



8,159


7,059







Taxation:






Tax on joint venture profits



(464)


(591)

Tax relating to adjusting items



(203)


(560)







Total adjusting items




 

 

 

 

7. SEGMENTAL ANALYSIS

 

As at 30 June 2017, the Group is organised into three main operating segments - Americas, Asia and EMEA. This has changed from the prior year when the three main segments were - Europe, USA and Emerging Markets. The change in segments reflects the format in which the key decision makers now review the business, the composition of the business and strategic intent.

 

The main activities of all segments are the production of exhibitions, conferences, magazines, directories and online media.

 

The following table sets out the revenue and profit information and certain asset and liability information for the Group's reportable segments:

 



30 June 2017

Unaudited






Central



Americas

Asia

EMEA

Costs

Group

Revenue by sector

£000

£000

£000

£000

£000







Group revenue

16,251

13,056

10,470

-

39,777







Profit/(loss) from operating activities

2,959

4,978

2,175

(8,123)

1,989

Net financing costs

-

-

-

(3,357)

(3,357)

Profit/(loss) before taxation

2,959

4,978

2,175

(11,480)

(1,368)

Adjusting items - see note 6

-

-

-

8,159

8,159

Adjusted profit/(loss) before tax

2,959

4,978

2,175

(3,321)

6,791







Segment non-current assets

116,695

65,482

45,399

-

227,576

Segment current assets

14,304

19,480

31,086

-

64,870


130,999

84,962

76,485

-

292,446







Deferred tax assets





2,928

Total assets





295,374







Segment liabilities

38,274

23,668

159,919

-

221,861







Liabilities for current tax





1,306

Deferred tax liabilities





10,918

Total liabilities





234,085

 

 

 

7. SEGMENTAL ANALYSIS (CONTINUED)

 




30 June 2016

Unaudited






Central



Americas

Asia

EMEA

Costs

Group

Revenue by sector

£000

£000

£000

£000

£000







Group revenue

12,204

7,695

7,055

-

26,954







Profit/(loss) from operating activities

4,258

1,884

487

(6,722)

(93)

Net financing costs

-

-

-

(3,001)

(3,001)

Profit/(loss) before taxation

4,258

1,884

487

(9,723)

(3,094)

Adjusting items - see note 6

-

-

-

7,059

7,059

Adjusted profit/(loss) before tax

4,258

1,884

487

(2,664)

3,965







Segment non-current assets

77,461

37,645

50,285

-

165,391

Segment current assets

12,872

7,547

21,437

-

41,856


90,333

45,192

71,722

-

207,247







Deferred tax assets





-

Total assets





207,247







Segment liabilities

31,865

14,065

115,870

-

161,800







Liabilities for current tax





-

Deferred tax liabilities





9,168

Total liabilities





170,968

 

 

 

8. TAXATION CHARGE

 

The taxation charge for the six months ended 30 June 2017 is based upon the estimated effective tax rate of 16.0% on adjusted profit before tax (2016: 15.2%) for the year ending 31 December 2016.

 

 

 

9. EARNINGS PER SHARE



Six months to

Six months to



30 June 2017


30 June 2016



Pence


Pence



Unaudited


Unaudited






Basic earnings per share


(3.2)


(3.1)

Diluted earnings per share


(3.2)


(3.1)

Adjusted earnings per share


3.5


2.8

Adjusted diluted earnings per share


3.5


2.7

 

 

 

Basic earnings per share

Basic earnings per share has been calculated on loss after tax attributable to ordinary shareholders for the six months of £3,551,775 (June 2016 loss: £3,121,652) and 112,249,882 (June 2016: 101,365,693) ordinary shares, being the weighted average number of shares in issue during the period.

 

Diluted earnings per share

Diluted earnings per share has been calculated on loss after tax attributable to ordinary shareholders for the six months of £3,551,775 (June 2016 loss: £3,121,652) and 112,662,685 (June 2016: 101,516,395) ordinary shares, being the diluted weighted average number of shares in issue during the period.

 

 

Adjusted earnings per share

Adjusted earnings per share is calculated using adjusted profit after tax as reconciled in note 6 and the weighted average number of ordinary shares (as below) in issue in the year.

 

Adjusted diluted earnings per share

Adjusted diluted earnings per share is calculated using loss after tax as reconciled in note 6 and the weighted average number of diluted ordinary shares (as below) in issue in the year.

 

 

Weighted average number of ordinary shares (diluted):

 



Six months to

Six months to



30 June 2017


30 June 2016



Unaudited


Unaudited






Weighted average number of ordinary shares


112,249,882


101,365,693

Dilutive effect of share options


412,804


150,702






Weighted average number of ordinary shares (diluted)


112,662,686


101,516,395

 

 

 

 

10. INTANGIBLE FIXED ASSETS



Goodwill

Trademarks, lists and other

Total



£000

£000

£000



Unaudited

Unaudited

Unaudited

COST





As at 1 January 2017


137,513

91,552

229,065

Additions through business acquisition


12,147

8,321

20,468

Additions


-

509

509

Disposals


-

(290)

(290)

Foreign exchange


(6,575)

(4,750)

(11,325)

At 30 June 2017


143,085

95,342

238,427






AMORTISATION





As at 1 January 2017


146

42,106

42,252

Charge for the year


-

4,642

4,642

Disposals


-

(290)

(290)

Foreign exchange


(4)

(2,082)

(2,086)

At 30 June 2017


142

44,376

44,518






NET BOOK VALUE





At 30 June 2017


142,943

50,966

193,909

At 31 December 2016


137,367

49,446

186,813

At 30 June 2016


112,425

26,884

139,309

 

 

 

 

11. FINANCIAL INSTRUMENTS

 

The carrying value of all financial instruments held in the Statement of Financial Position equals their fair value.

 


30 June 2017

Level 1

Level 2

Level 3


£000

£000

£000

£000






Interest rate swaps

(1,909)

-

(1,909)

-

Contingent consideration

(28,944)

-

-

(28,944)

Put and call option liabilities

(9,568)

-

-

(9,568)







(40,421)

-

(1,909)

(38,512)







30 June 2016

Level 1

Level 2

Level 3


£000

£000

£000

£000






Interest rate swaps

(3,200)

-

(3,200)

-

Forward contracts

(816)

-

(816)

-

Contingent consideration

(21,141)

-

-

(21,141)

Put and call option liabilities

(21,965)

-

-

(21,965)







(47,122)

-

(4,016)

(43,106)







31 December 2016

Level 1

Level 2

Level 3


£000

£000

£000

£000






Interest rate swaps

(2,434)

-

(2,434)

-

Forward contracts

(23)

-

(23)

-

Contingent consideration

(34,575)

-

-

(34,575)

Put and call option liabilities

(14,504)

-

-

(14,504)







(51,536)

-

(2,457)

(49,079)






Reconciliation of level 3 fair value measurements










2017

2016


Put and call option liabilities

Contingent consideration

Put and call option liabilities

Contingent consideration


£000

£000

£000

£000

At 1 January

(14,504)

(34,575)

(18,816)

(23,428)

Acquisitions

-

(805)

(1,261)

(590)

Consideration paid

-

5,938

-

4,979

Exercise of put option

5,073

-

2,060

-

Change in estimates

(457)

(90)

(661)

1,297

Unwinding of discount

(430)

(822)

(960)

(810)

Foreign exchange

750

1,410

(2,327)

(2,589)

At 31 December

(9,568)

(28,944)

(21,965)

(21,141)

 

 

Level 1 - fair values measured using quoted prices (unadjusted) in active markets for identical assets or liabilities.

 

Level 2 - fair values measured using indicative market valuations provided by banks for the identifiable asset of liability.

 

Level 3 - fair values using inputs or liabilities that are not based on observable market data. These are measured by using the latest management forecasts and using a country specific WACC rate to discount to the present value.

 

 

12. ACQUISITIONS

 

The Group completed one acquisition during the first half of 2017, in line with the Group's "Quickening the Pace" strategy.

 

Effective date

Name

Type of buisness

Percentage




acquired

25 January 2017

Foshan Huaxia Home Textile Development Co., Ltd ("Hometex"),

Exhibition business

65%

 

 

The following table sets out the book values of the identifiable assets and liabilities acquired and their fair value to the Group, in respect of the acquisition made during 2017:

 

 



Hometex

Adjustments

Fair value



£000

£000

£000






Other intangibles


-

8,320

8,320

Net liabilities


395

(556)

(161)

Deferred tax asset


-

139

139

Net assets acquired


395

7,903

8,298

Goodwill arising on acquisition




12,147





20,445

Consideration paid and costs incurred:





Satisfied in cash




16,325

Contingent consideration (less than one year)




3,293

Contingent consideration (greater than one year)




827

Total consideration incurred




20,445






Consideration paid in cash




15,896

Total net cash outflow




15,896

 

 

Contingent consideration, relates to payments to vendors, payable after completion, that are dependent on the outcome of future events. This contingent consideration is dependent on the financial performance of the exhibitions occurring in 2017 and 2018.

 

From the date of acquisition to 30 June 2017, the acquisition has contributed £5.2m of revenue to the Group.

 

Goodwill of £12.1 million, recognised on this acquisition, relates to certain assets that cannot be separated and reliably measured. These items include sector knowledge, customer loyalty and the anticipated future profitability that the Group can bring to the business acquired.

 

The Group incurred transaction costs of £400,000 in respect of the acquisition, which were expensed.

 

The values used in accounting for the identifiable assets and liabilities and related contingent consideration of this acquisition are estimates and are therefore provisional in nature at the balance sheet date. If necessary, adjustments will be made to these carrying values and the related goodwill, within 12 months of the acquisition date. The non-controlling interest is measured as their proportionate share of the fair value of the net assets.

 

Consideration paid in cash represents the initial cash payment and the first contingent consideration payment net of cash acquired.

13. DIVIDENDS

 

The following dividends were paid and proposed by the Group:

 



2017


2016



£000


£000



Unaudited


Unaudited






Dividend paid in current period in cash or scrip





2016 interim dividend (2.7p per share)


2,751


2,540








2,751


2,540






Dividend paid and proposed post period end





2016 final dividend paid 6.4p per share (2015: 5.9p per share)


7,201


5,998

Dividend proposed in the period 3.0p per share (2016: 2.7p per share)


3,380


2,737








10,581


8,735

 

 

 

14. FOREIGN EXCHANGE TRANSLATION DIFFERENCES

 

Other Comprehensive Income includes foreign exchange translation losses of £7.4 million (June 2016: gains of £8.4 million) relating to the retranslation of foreign currency denominated net assets, including goodwill.

 

 

15. RELATED PARTIES

 

As at 30 June 2017, directors of the company controlled 9.6% (31 December 2016: 9.5%) of the voting shares of the company.

 

Executive officers also participate in the Group's share option programme and share acquisition plan.

 

 

16. POST BALANCE SHEET EVENTS

 

There have been no significant post balance sheet events.

 

 

17. DEFINITIONS

 

Organic revenues are on a constant currency basis and after adjusting for the impact of acquisitions, disposals and biennials.

 

Forward bookings:

Committed orders for future events, adjusted for biennials.

 

Like-for-like revenue:

Constant exchange rates adjusted for biennial events, excluding acquisitions impacting for the first time in 2016, prior year disposals and non-recurring products and items.

 

Adjusted profit before tax:

Profit before tax adjusted for exceptional items, share option charges / credits, movements in fair value measurement of derivatives, unsettled amortisation charges, impairment of intangibles, profit / loss on disposal of intangibles and tangible fixed assets, profit on sale of subsidiary and unwinding of discount for contingent consideration. See note 6.

 

 

 

 

17. DEFINITIONS (CONTINUED)

 

Adjusted EPS:

Profit after tax attributable to equity shareholders adjusted for exceptional items, share option charges / credits, movements in fair value measurement of unsettled derivatives, amortisation charges, impairment of intangibles, profit / loss on disposal of intangibles and tangible fixed assets, profit on sale of subsidiary and unwinding of discount - contingent consideration. See note 9.

 

Adjusted operating cash:

Cash from operations adjusted for non-operating items and disposals.

 

2015 comparatives:

Restated for the removal of discontinued operations (France).

 

 

 

 

 

 

 

 

RESPONSIBILITY STATEMENT OF THE DIRECTORS IN RESPECT OF THE HALF-YEARLY FINANCIAL REPORT

 

We confirm that to the best of our knowledge:

 

·      The condensed set of financial statements, which has been prepared in accordance with the applicable set of accounting standards, gives a true and fair view of the assets, liabilities, financial position and profit or loss of the Group;

·      The interim management report includes a fair review of the information required by:

(a)  DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and

(b)  DTR4.2.8R of the Disclosure and Transparency Rules, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the entity during that period; and any changes in the related party transactions described in the last annual report that could do so.

 

 

 

Principal risks and uncertainties

 

The Board consider the principal risks and uncertainties relating to the Group for the next six months to be the same as details in our last Annual Report and Accounts to 31 December 2016 and include:

 

·      Economic and financial uncertainties;

·      Events and exhibitions may be adversely affected by incidents which can curtail travel;

·      Expansion into new geographic regions subjects the group to new operating risks;

·      Fluctuation in exchange rates may affect the reported results;

·      The ability to implement and execute strategic plans depends on the ability to attract and retain key management.

 

The impact of "Brexit" has been considered and has not resulted in a change to these risks.

 

Full details of the risks and uncertainties are detailed in the Directors' Report of the 2016 accounts.

 

 

 

 

 

Douglas Emslie                                                                                                         Daniel O'Brien

Group Managing Director                                                                                          Group Finance Director

26 July 2017

 

 


This information is provided by RNS
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Half-year Report - RNS