Acquisition

9th Oct 2007 07:00

Electric Word PLC09 October 2007 9 October 2007 Electric Word plc Acquisition expands Education Publishing Electric Word plc, the specialist information publisher, announces today theacquisition of Speechmark Publishing Ltd ("Speechmark") for a cash considerationof £2.0m. Speechmark, which as Winslow Press was established in 1984, is a leadingpublisher of books and other resources for speech therapists and Special Needsprofessionals in schools and other children's and adults' services, and willcomplement the Group's current Special Needs publications. At the heart of thebusiness is its range of Colorcards photographic resources, which have built aninternational reputation across the US and Europe over the last twenty years. In the year to December 2006, Speechmark reported pre-tax profits of £22,000 onrevenues of £1.7m. The Directors expect that Speechmark's pre-tax profits forthe year ending December 2007, before integration costs, will be no less than£180,000. The consideration of £2.0m is comprised of an initial payment of £1.35m and theissue of loan notes to the value of £650,000. The loan notes are issued in twotranches, £150,000 bearing interest at base rate repayable within six months and£500,000 bearing no interest and repayable within twelve months. The initialconsideration will be funded through a revolving credit facility of £1.5m andthe redemption of the loan notes through cashflow. The acquisition is expected to be immediately earnings enhancing, exceptinginitial integration costs in the period to December 2007*. The existing Electric Word businesses continue to meet the Board's expectationsfor the current year. Julian Turner, Electric Word's Chief Executive, commented: "Speechmark is an award-winning publisher with an outstanding reputation builtover many years. Its speech and language therapy and other products fit wellwith our existing strength in Special Needs education and we look forward toemploying Electric Word's educational publishing and marketing expertise infurther developing the business. With the synergies we can achieve withinElectric Word we anticipate Speechmark making a positive contribution toearnings in its first full year of ownership." - ends - Julian Turner, Chief Executive Helen Thomas / Tim Spratt Electric Word plc, 0207 954 3470 Financial Dynamics, 0207 831 3113 * For the avoidance of doubt, this statement should not be construed as a profitforecast, and the statement regarding earnings enhancement should not beinterpreted to mean that earnings per share will necessarily be greater thanthose for the relevant preceding financial period. This information is provided by RNS The company news service from the London Stock Exchange

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