Interim Results
11 Februar 2003 - 8:00AM
UK Regulatory
RNS Number:3091H
Charterhouse Communications PLC
11 February 2003
CHARTERHOUSE COMMUNICATIONS PLC
11 FEBRUARY 2003
Charterhouse Communications plc ("Company" or "Charterhouse")
Interim results for the six months to 30th November 2002
Summary:
* turnover #5.3m (2001: #6.5m) - down 19%
* cost of sales #3.5m (2001: #4.8m) - down 26%
other administrative expenses #1.3m (2001: #1.6m) - down 18%
* operating profit before amortisation #402,000 (2001: #97,000)
* pretax profit #135,000 before amortisation of #445,000 (2001: loss
#107,000 before amortisation of #8,198,000)
* cash inflow from operating activities #606,000 (2001: #50,000)
* no interim dividend to be paid (2001: nil)
Chairman Brian Rowbotham said:
"Until the uncertainty caused by the possibility of an Iraq war is lifted, there
may be little improvement in the personal investment market apart from some
seasonal advertising of ISAs prior to the fiscal year end.
"A cooling of the housing market may not be disadvantageous to us as mortgage
providers may advertise more to compete in an effort to maintain, if not
increase, market share.
"As reported before, we continue to run a tight ship with every cost under
strict control. We are making no assumptions regarding an up-turn in markets
until there is firm evidence.
"Consequently, we are not giving any indication of profit levels for the second
half year except that we expect to return a profit before tax and amortisation."
Further information:
Geoff Gamble, Managing Director
020 7827 5454
CHAIRMAN'S STATEMENT
Strict cost control resulted in our direct costs being reduced by 26% in the six
months to 30 November 2002 compared to the same period last year as we responded
to the challenge of a further revenue decline caused by weak conditions in
financial markets which have lowered the faith of private investors to invest
further.
Our magazines were in two differently performing markets.
The mortgage magazines were certainly in the premier division, producing
increased revenues and profit contribution due to the growth of our fortnightly
Mortgage Introducer.
However, our UK personal finance magazines were in the most difficult market,
albeit maintaining their relative market positions, with lower revenues leading
to lower profit contributions despite stringent cost controls.
HS Publishing produced profits but subscription income declined in line with the
reducing number of active private investors and city executives.
Brand & Co - our distributor of books and government publications to
professional firms in London - enjoyed an excellent period due to the volume of
legislation and regulatory material.
We ceased promoting Successful Personal Investing last year but continued to
edit the course so as to service existing subscribers and provide an update
service to past subscribers. This much lower level of activity has removed both
substantial turnover and cost, turning Independent Research Services from a
loss-making to a profitable operation.
RESULTS
Turnover decreased by 19% to #5.3 million. Half of that decrease was due to
ceasing the sale of Successful Personal Investing to new subscribers. Our
personal finance magazines and HS Publishing each recorded significant falls
whilst the mortgage magazines increased their revenues due to the success of
Mortgage Introducer.
Cost of sales, which consists of both external production costs and direct
internal costs of the publications, was reduced by 26% to #3.5 million with all
expenditure under constant scrutiny. Other administrative costs were reduced by
18% to #1.3 million.
We thus produced an operating profit before goodwill amortisation of #402,000
(2001: #97,000) which translated into #606,000 (2001: #50,000) positive cash
flow from operating activities.
Profit on ordinary activities after interest and tax but before goodwill
amortisation was #135,000 (2001: loss of #107,000), and after amortisation of
#445,000 (2001: #683,000 and further exceptional amortisation of #7,515,000)
there was a loss on ordinary activities after tax of #310,000 (2001: loss of
#8,305,000).
Earnings per share before amortisation were 0.11p (2001: deficit 0.09p) and
after amortisation the deficit per share was 0.25p (2001: deficit 6.73p).
As last year, no interim dividend is being declared.
BALANCE SHEET
The balance sheet now reflects the cancellation of the Company's share premium
account and merger reserve for which shareholders gave their approval last
September and which the Court sanctioned in October. Revenue reserves are now
positive.
CURRENT PERIOD
Until the uncertainty caused by the possibility of an Iraq war is lifted, there
may be little improvement in the personal investment market apart from some
seasonal advertising of ISAs prior to the fiscal year end.
A cooling of the housing market may not be disadvantageous to us as mortgage
providers may advertise more to compete in an effort to maintain, if not
increase, market share.
As reported before, we continue to run a tight ship with every cost under strict
control. We are making no assumptions regarding an up-turn in markets until
there is firm evidence thereof.
Consequently we are not giving any indication of profit levels for the second
half year except that we expect to return a profit before tax and amortisation.
Brian W Rowbotham
Chairman
11 February 2003
Consolidated profit and loss account
for the six months ended 30 November 2002
Six months ended
30 November 2002 30 November 2001 Year ended
Unaudited (restated) 31 May 2002
#'000 Unaudited Audited
#'000 #'000
Turnover 5,276 6,510 12,858
Cost of sales (3,542) (4,788) (9,251)
-------- -------- --------
Gross profit 1,734 1,722 3,607
Administrative expenses
Amortisation of goodwill and intangible assets (445) (683) (1,144)
Exceptional amortisation - (7,515) (7,840)
Other administrative expenses (1,332) (1,625) (3,550)
-------- -------- --------
(1,777) (9,823) (12,534)
Operating loss (43) (8,101) (8,927)
Share of loss in associate - (22) (43)
Interest receivable 1 4 10
Interest payable (209) (192) (380)
-------- -------- --------
Loss on ordinary activities before taxation (251) (8,311) (9,340)
Tax on loss on ordinary activities (59) 6 18
-------- -------- --------
Loss on ordinary activities after taxation (310) (8,305) (9,322)
Dividends - - -
-------- -------- --------
Retained loss for the period (310) (8,305) (9,322)
======== ======== ========
(Deficit)/earnings per ordinary share
standard (0.25p) (6.73p) (7.56p)
before amortisation of goodwill and
intangible assets 0.11p (0.09p) (0.27p)
Diluted (deficit)/earnings per ordinary share
standard (0.25p) (7.03p) (7.56p)
before amortisation of goodwill and
intangible assets (0.11p) (0.10p) (0.27p)
Dividend per ordinary share - - -
Consolidated balance sheet
as at 30 November 2002
As at As at As at
30 November 30 November 31 May
2002 2001 2002
Unaudited (restated) Audited
Unaudited
#'000 #'000 #'000
Fixed assets
Goodwill and intangible assets 10,253 12,418 11,098
Tangible assets 268 389 332
---------- ---------- ----------
10,521 12,807 11,430
---------- ---------- ----------
Stock and work in progress 107 247 201
Debtors: due within one year 1,649 2,770 2,288
due after one year 520 641 527
Cash at bank and in hand 237 235 183
---------- ---------- ----------
2,513 3,893 3,199
Creditors: amounts falling due within one year (5,970) (8,211) (6,645)
---------- ---------- ----------
Net current liabilities (3,457) (4,318) (3,446)
---------- ---------- ----------
Total assets less current liabilities 7,064 8,489 7,984
Creditors: amounts falling due after one year (4,608) (4,608) (5,218)
Provisions for liabilities and charges - (98) -
---------- ---------- ----------
Net assets 2,456 3,783 2,766
========== ========== ==========
Capital and reserves
Share capital 1,233 1,233 1,233
Share premium account - 6,757 6,757
Merger reserve - 1,650 1,650
Special reserve 588 - -
Profit and loss account 635 (5,857) (6,874)
---------- ---------- ----------
Equity shareholders' funds 2,456 3,783 2,766
========== ========== ==========
Consolidated cash flow statement
for the six months ended 30 November 2002
Six months ended
30 November 30 November Year ended
2002 2001 31 May 2002
Unaudited Unaudited Audited
#'000 #'000 #'000
Cash flow from operating activities 606 50 499
Returns on investments and servicing of finance (208) (188) (370)
Taxation (26) (1) (1)
Capital expenditure and financial investment (11) (82) (136)
Equity dividends paid - (284) (284)
--------- --------- ---------
Cash flow before financing 361 (505) (292)
Financing (239) (823) (1,163)
--------- --------- ---------
Increase/(decrease) in cash in period 122 (1,328) (1,455)
========= ========= =========
Notes
1. The financial information contained in this interim report does not
constitute statutory accounts as defined in section 240 of the Companies Act
1985 ('the Act'). The financial information for the year ended 31 May 2002
is an abridged version of the Group's published financial statements for
that year which contained an unqualified audit report and which have been
filed with the Registrar of Companies. The audit report contained no
statement under s237(2) or (3) of the Act.
2. The results for the half years to 30 November 2002 and 30 November 2001 have
been prepared on the basis of the accounting policies adopted in the
accounts for the year ended 31 May 2002. This has resulted in the
restatement of the results for the half year to 30 November 2001 to comply
with the new Financial Reporting Standard 19, 'Deferred Tax'.
3. Goodwill and intangible assets are amortised through the Group's profit and
loss account over a maximum period of 20 years, in accordance with Financial
Reporting Standard 10 'Goodwill and Intangible Assets'. Contingent deferred
consideration of #400,000 in respect of HS Publishing Group Limited has been
written back to goodwill in the period.
4. The special reserve arose as a result of the reduction of capital approved by
shareholders in September 2002 and sanctioned by the Court in October 2002.
5. The Group has a term bank loan of #5.03 million, and an overdraft repayable
on demand which is to be reviewed in May 2003. The overdraft facility is
currently #1.6 million, and is scheduled to reduce to #1.5 million on 1 May
2003.
The Group has prepared profit and cash flow forecasts which are necessarily
dependent on the trading performance of the business. Such is the level of
uncertainty inherent in predicting future trading that in the opinion of the
directors the ability of the Group to continue to trade is dependent upon the
bank's willingness to maintain its support and to renew the overdraft facility
in May 2003. The directors consider that despite these uncertainties it is
appropriate to prepare the financial statements on a going concern basis. The
financial statements do not include any adjustments that would result from a
withdrawal of facilities by the Group's bankers.
6. No interim dividend will be paid (2001: nil).
7. This report is being sent to shareholders and is available for at least
fourteen days from the Company's registered office at Arnold House, 36-41
Holywell Lane, London EC2A 3SF.
Notes to Editors
Charterhouse Communications plc products include the following:
What Investment
Personal Finance
What ISA
UK Fund Industry Review & Directory
What Mortgage
Complete Guide to Homebuying
Mortgage Finance Gazette
Mortgage 2003
Building Societies Yearbook
Mortgage Introducer
Investment International
Successful Personal Investing
The IRS Report
Investing for Growth
Company REFS
PricewaterhouseCoopers Corporate Register
Pinsents Company Guide
Treasury Management International
European Municipal Directory
European Local Government Officers Database
Brand & Co (Booksellers) Ltd
Arnold House 36-41 Holywell Lane London EC2A 3SF
Tel: 020 7827 5454 Fax: 020 7827 0567
This information is provided by RNS
The company news service from the London Stock Exchange
END
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