9th Mar 2005 07:01
Interactive Prospect TargetingHdgs09 March 2005 For release 7:00am 9 March 2005 Interactive Prospect Targeting Holdings plc Preliminary results for the year ended 31 December 2004. Interactive Prospect Targeting Holdings plc ('IPT' or 'the Company'), the onlinedirect marketing company, announces its maiden preliminary results for the yearended 31 December 2004. Highlights • In December 2004, the Company was successfully admitted to the Alternative Investment Market ('AIM') of the London Stock Exchange, raising £4.5m of new capital (£3.9m net of expenses) • Turnover up 37% to £8.4 million • Operating profits increased by 106% to £0.9m • Profit before tax up by 123% to over £1 million • Shareholders funds increase by £4.7 million to £6.6 million • Diluted EPS doubled to 2.6p from 1.3p in 2003 Commenting today, Colin Lloyd, Chairman said: IPT stands at the point where Internet advertising and direct marketing converge. These two forms of communication are powerful in their own right; combined they have spawned the new discipline of email marketing which is now one of the fastest growing communication channels in the world. Chairman's Statement On 9th December 2004, following a reorganisation of the Group, the shares of theCompany were listed on the Alternative Investment Market (AIM). The listingraised £4.5m (£3.9m net of expenses), at a market capitalisation of £23.5m. When I wrote at the end of 2003 as Chairman of IPT limited I reported that theCompany had made substantial investments in technology and product development,building the right infrastructure for sustained future growth. A year later I amdelighted to be able to report that this investment has been rewarded withrecord revenues and profits. Turnover for the year was £8.4million, an increaseof 37% over 2003 resulting in a 123% increase in profit on ordinary activitiesto over £1million. The multiple successes of 2004 provide a strong platform for continued growthboth in terms of existing products and services and new developments to assistdigital marketers. IPT's core expertise in the field of email marketing isenshrined in a new 5-volume Essential Guide to Email Marketing, which theCompany has launched to wide acclaim at seminars across the country. IPT has achieved a market leading position in the direct marketing/new mediamarketplace, and I wholeheartedly endorse the management's commitment toeducation, innovation and raising standards in this new sector. The Company's pioneering achievements have helped lead the development of onlinedata capture and the email communication medium. In many ways, last year saw theindustry reach a new level of market acceptance. Email is now an establishedmarketing channel, being used by hundreds of the UK's largest companies whorecognise that the use of the Internet to collect data and engage customers indialogue have demonstrable cost and speed advantages over traditional postal ortelephone channels, delivering a compelling interactive consumer experience. IPTis now pre-eminent in the UK in the provision of email data, email broadcastingand online market research, offering its clients greater volumes and superiorquality of 'lifestyle' data than any of its competitors. The development of the company to its current market leadership has been arewarding experience for us all culminating in our admission to AIM last year.It is therefore appropriate for me thank the management team and our employeesfor their commitment and professionalism in achieving our success. Thecombination of our investment in the very best talent and market leadingtechnology provides the company with an excellent platform to continue itsgrowth into the current year and beyond and I am pleased to report that thecurrent year has begun positively, with increased trading levels. Colin LloydNon-executive Chairman Chief Executive's Review In February 2000 IPT launched MyOffers.co.uk with the aim of spearheading the UKdirect marketing industry's adoption of the email marketing medium. Five yearslater we believe we generate more online questionnaire responses than any othercompany, providing consumer prospects to our clients with permission for contactby email, direct mail, SMS or telephone. Our managed email delivery serviceEmailBureau is a market leader in terms of acquisition and retention campaigns,with an advanced range of reporting and delivery tools. The IMRS online marketresearch panel is one of the leading in the industry, translating into ultrafast, robust survey samples. Our Direct division is the UK's leading source ofopt-in email data, fresh lifestyle postal addresses and online registrations. In2004 IPT delivered data or services to over 600 clients. Our business is nowconducted through 4 divisions: Customer Acquisition, Services, Direct andInnovation. Customer Acquisition Five years ago, our groundbreaking online data collection site MyOffers.co.ukhelped to establish IPT as the pioneer of permission marketing. Today it is oneof the UK's most visited websites and has delivered over 700 opt-in prospectdatabases to well known brands. IPT's online data collection questionnaires areoffered across a range of online content including prize draws, incentives,quizzes and polls.One of the keys to IPT's success has been the quality and volume of its consumeruser base. The total inventory of IPT's website members stands at over 5.9million, with a further 170,000 fresh registrations each month. The high volumeof new registrations guarantees the freshness of our data, ensuring that clientsbenefit from an active and dynamic user profile. In return for completing short self-profiling questionnaires, members ofMyOffers gain entry to some of the best prize draws available on the web. Prizeson offer include cars, holidays, electrical and cash with at least 60 guaranteedwinners each month. The site has given away over £1,000,000 of prizes. TheMyOffers site is constantly evolving to meet the demands of our dedicated onlinemember base and to attract the many thousands of new members that join the siteeach week. We continually develop new promotions and content to ensure increasedrepeat visits, which translate into greater numbers of questionnairecompletions. Members now regularly return to the site to enjoy our onlinequizzes, daily prize draws, interactive games and daily polls.This year IPT has introduced WebBrands, a co-operative online promotion toolgiving non-competing companies the opportunity to generate high numbers ofonline registrations at low cost. As the latest product to join our CustomerAcquisition division, clients can use it as a stand-alone promotion tool or inconjunction with the wider database building solutions on offer. IPT's consumerprospect data is equally responsive whether used for email marketing, telesales,SMS communications or direct mail. Services IPT Services offers clients a range of email marketing and database managementsolutions using the most innovative technology available. We continually investin our email delivery infrastructure to offer the highest standard of serviceand maintain our status as champions of email broadcast in the UK. We providenot only the technology to conduct successful email marketing, but also offerunique tools and solutions to make campaigns more effective, more deliverableand ultimately more profitable.The IPT Services team is led by some of the most knowledgeable and experiencedexperts in the field, many of whom were responsible for the introduction ofcommercial opt-in email communication. They endeavour to share their expertisethroughout the direct marketing industry, whilst offering our clients a level ofservice and satisfaction that comes second to none. Direct With in-house databases of over 4.8 million email (IPT Online) and 2.1 millionunique postal (IPT Lifestyle) prospects, IPT Direct provides a fast, low costand effective method of targeting consumers for acquisition and brand buildingcampaigns. Our innovative web based data collection techniques facilitate themost effective method of targeting consumers at the lowest possible cost.Because data is collected online, all addresses are PAF validated and the dataentry errors normally associated with manual data capture are eradicated.All consumers have actively opted-in to receive information and offers relatingto their interests from IPT and third parties. Our respect for the consumer issecond to none and we strictly adhere to data protection legislation. Innovation IPT is constantly searching for new and innovative ideas to engage consumers andcapture prospect data, which will enable our clients to target and attract evenhigher volumes of new customers. The Innovation division is at the forefront ofnew concept development. IPT Innovation comprises an eclectic range of products. These are new or veryrecently launched websites, which enjoy considerable consumer acclaim but whosecommercial success is yet to be fully realised. Many of these are evolving intoclient-led products and services, opening up new revenue streams or adding extravalue to our existing core solutions. Employees I am delighted with the performance of IPT's employees and management teamduring the period under review. They have shown outstanding commitment toachieving our business development objectives and new product initiatives. Outlook Our aim for 2005 is to continue to expand our core businesses and to develop newopportunities within the rapidly expanding marketplace in which we operate. Thepower of our products and the growing acceptance of on-line marketing as thechosen method of communication between advertisers and their customers are allreasons for management, employees and shareholders to be positive. Lionel ThainChief Executive Officer Consolidated Profit and Loss AccountFor the year ended 31 December 2004 Note 2004 2003 £'000 £'000 TURNOVER 8,441 6,139Cost of sales (1,607) (1,096) -------- --------Gross profit 6,834 5,043Administrative expenses (5,944) (4,611) -------- --------OPERATING PROFIT 890 432Profit on disposal of fixed asset investments 78 -Interest receivable and similar income 34 18 -------- --------PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION 1,002 450Tax charge on profit on ordinary activities 3 (299) (99) -------- --------PROFIT FOR THE FINANCIAL YEAR AFTER TAXATION 703 351Minority interest (2) (12) -------- --------PROFIT FOR THE FINANCIAL YEAR AFTER TAXATION & MINORITYINTEREST 701 339Dividends 4 (115) (18) -------- --------Retained profit for the year 6 586 321 ======== ========Earnings per shareBasic earnings per share (pence) 5 3.0 1.7Diluted earnings per share (pence) 2.6 1.3 All results arise from continuing operations.There are no recognised gains or losses other than the results for the year.Accordingly, a statement of total recognised gains and losses has not beenpresented. Consolidated Balance SheetAs at 31 December 2004 Note 2004 2003 £'000 £'000FIXED ASSETSIntangible assets - goodwill 45 -Intangible assets - other 403 163Tangible fixed assets 385 388Investments 2 2 -------- ------- 835 553 -------- -------CURRENT ASSETSCurrent asset investments 28 56Debtors 2,473 1,934Cash at bank and in hand 8 5,204 904 -------- ------- 7,705 2,894CREDITORS: amounts falling due within one year (1,884) (1,376) -------- -------NET CURRENT ASSETS 5,811 1,518 -------- -------TOTAL ASSETS LESS CURRENT LIABILITIES 6,646 2,071CREDITORS: amounts falling due after one year (3) - -------- -------NET ASSETS 6,643 2,071 ======== =======CAPITAL AND RESERVESCalled up share capital 6 133 104Share premium account 6 3,926 -Merger Reserve 6 2,354 2,237EBT reserve 6 (2) -Other reserve 6 18 18Profit and loss account 6 214 (372) -------- -------SHAREHOLDERS' FUNDS 6 6,643 1,987Minority interest - 84 -------- ------- TOTAL CAPITAL EMPLOYED 6,643 2,071 ======== =======Total shareholders funds may be analysed asfollows:Equity interests 449Non-equity interests 1,538 ------- 1,987 ======= Consolidated Cashflow StatementFor the year ended 31 December 2004 Note 2004 2003 £'000 £'000 £'000 £'000 Net cash inflow from operating activities 7 950 311 Returns on investments and servicing offinanceInterest received 34 18Dividends paid to non-equity shareholders (133) -Returns on investments and servicing offinance (99) 18 Taxation paid - (3) Capital expenditure and financialinvestmentPurchase of intangible fixed assets (376) (203)Purchase of tangible fixed assets (236) (320)Proceeds from sale of tangible fixed 3 -assetsPurchase of trade investments - (2)Proceeds from sale of fixed assetinvestments 106 - (503) (525) ------- -------Cash inflow/(outflow) before managementof 348 (199)liquid resources and financing FinancingIssue of ordinary share capital 3,953 -Purchase of own shares (2) -Capital element of finance lease rentalpayments 1 (25)Financing 3,952 (25) ------- -------Increase/(decrease) in cash in the year 4,300 (224) ======= ======= NOTES 1. The financial information set out above in respect of the yearsended 31 December 2004 and 31 December 2003 does not constitute the company'sfinancial statements for those periods but has been derived from the auditedstatutory accounts for those years, and is prepared using the same accountingpolicies. Statutory accounts for the year ended 31 December 2004 will bedelivered to the Registrar of Companies shortly. The auditors have reported onthose accounts; their report is unqualified and did not contain statements unders237(2) or (3) Companies Act 1985. 2. During the year, Interactive Prospect Targeting Holdings plcacquired the entire share capital of Interactive Prospect Targeting Limited byway of a share for share exchange. The acquisition of Interactive ProspectTargeting Limited qualifies as a group reconstruction and has therefore beenaccounted for as a merger. Therefore the group financial statements have beenprepared as if the group was in existence for the whole of the current and priorperiods. The audited statutory accounts of Interactive Prospect TargetingLimited, therefore comprise the comparative information referred to above.Statutory accounts for Interactive Prospect Targeting Limited for the year ended31 December 2003 have been delivered to the Registrar of Companies and theauditors have reported on those financial statements; their report wasunqualified and did not contain a statement under section 237(2) or (3) of theCompanies Act 1985. The accounting policies have been applied throughout thecurrent and preceding year. 3. TAX CHARGE ON PROFIT ON ORDINARY ACTIVITIES The tax charge comprises 2004 2003 £'000 £'000 Current taxUK corporation tax (137) (14)Adjustment in respect of prior years (7) 3 -------- -------- (144) (11) -------- --------Deferred tax(Decrease) in estimate of recoverable deferred tax (169) (112)assetAdjustment in respect of prior years 14 24 -------- -------- (155) (88) -------- --------Total tax on profit on ordinary activities (299) (99) ======== ========The difference between the total current tax as shown and the amounts calculatedby applying the standard rate of UK corporation tax to the profit before tax isas follows: 2004 2003 £'000 £'000 Profit on ordinary activities before tax 1,002 450 -------- --------Tax on profit on ordinary activities at standard UKcorporation (301) (135)tax rate of 30% Effects of:Depreciation in excess of capital allowances (22) (2)Expenses not deductible (17) (15)Prior period adjustments (7) 3Utilisation of prior period losses 186 132Other timing differences 5 (2)Other 12 8 -------- --------Current tax charge for period (144) (11) ======== ======== 4. DIVIDENDS 2004 2003 £'000 £'000 Non-equity shares Class B-1 (10% cumulative dividend) 34 5Class B-2 (10% cumulative dividend) 36 5Class C-1 (10% cumulative dividend) 45 8 -------- -------- 115 18 ======== ========The preference dividend related to the preference shares held in InteractiveProspect Targeting Ltd, a subsidiary undertaking.The holders of the 'B-1', 'B-2' and 'C-1' preference shares in InteractiveProspect Targeting Ltd were entitled to a fixed gross cumulative dividend of 10%per annum commencing from 11 November 2003. The preference dividend wascalculated on the aggregate of the nominal amount of such preference share, thepremium paid on subscription and any arrears of the dividend for such preferenceshare.The preference shares were converted to ordinary shares on 30 November 2004 at arate of 1 ordinary share per preference share held, and the accumulated dividendoutstanding was paid on that date.On 1 December 2004 Interactive Prospect Targeting Holdings plc acquired all theshare capital of Interactive Prospect Targeting Limited pursuant to a share forshare exchange agreement. 5. EARNINGS PER SHARE Basic earnings per share has been calculated in accordance with FRS 14 bydividing the consolidated profit after tax attributable to shareholders by theweighted average number of ordinary shares outstanding during the year.Diluted earnings per share has been calculated on the same basis as above exceptthe weighted average number of shares that would be issued on the conversion ofall dilutive potential ordinary shares into ordinary shares has been added tothe denominator.The calculation of earnings per share is based on the following profits andnumber of shares: 2004 2003 Profit after Number of Pence Profit after Number of Pence tax shares per tax shares per share £'000 '000 share £'000 '000 Basicearnings per share 586 19,406 3.0 321 18,558 1.7 Impact ofshare - 3,130 (0.4) - 3,046 (0.2)options Impact ofpreferenceshares 115 4,471 - 18 4,886 (0.2) -------- -------- ------ -------- -------- ------ 701 27,007 2.6 339 26,490 1.3 ======== ======== ====== ======== ======== ====== 6. RESERVES Group Share Capital Profit and Merger reserve EBT reserve Other Share 2004 loss reserve premium account account £'000 £'000 £'000 £'000 £'000 £'000 £'000 Balance atbeginningof 104 (372) 2,237 - 18 - 1,987year Adjustmentarisingfromacquisitionofminority - - 117 - - - 117interestforshares Sharesissuedto Employee 2 - - (2) - - -BenefitTrust Profitretainedfor - 586 - - - - 586the year Dividendaccrued onpreferenceshares - - - - 115 - 115Payment ofdividend onpreferenceshares - - - - (133) - (133) Placing ofshares onadmissionto 27 - - - - 3,926 3,953AIM Arising onacquisitionofminority - - - - 18 - 18interest ------ ------ ------ ------ ------ ------ ------ At 31December 133 214 2,354 (2) 18 3,926 6,6432004 ====== ====== ====== ====== ====== ====== ====== 7. RECONCILIATION OF OPERATING PROFIT TO OPERATING CASH FLOWS 2004 2003 £'000 £'000 Operating profit 890 432Depreciation 238 169Amortisation 141 59Loss on fixed asset investment 1 -Profit on disposal of fixed assets (2) -Increase in debtors (701) (462)Increase in current asset investments - (56)Increase in creditors 383 169 -------- --------Net cash inflow from operating activities 950 311 ======== ======== 8. ANALYSIS AND RECONCILIATION OF NET FUNDS 1 January 2004 Cash flow 31 December 2004 £'000 £'000 £'000 Cash in hand, at bank 904 4,300 5,204 Finance leases (13) (1) (14) -------- -------- --------Net funds 891 4,299 5,190 ======== ======== ======== 2004 2003 £'000 £'000 Increase/(decrease) in cash in the year 4,300 (224)Cash flow from movement in debt and lease financing (1) 25 -------- --------Change in net funds/(debt) resulting from cash flows 4,299 (199) -------- --------Movement in net funds /(debt) in year 4,299 (199)Net funds at 1 January 891 1,090 -------- --------Net funds at 31 December 5,190 891 ======== ======== This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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