28th Aug 2012 07:00
UTV Media plc ("UTV" or "the Company" or "the Group") Interim Results for the six months ended 30 June 2012
Financial highlights on continuing operations (1)
* Group revenue up 4% to £61.6m (2011: £59.1m) * Pre-tax profits up by 3% to £11.2m (2011: £10.9m) * Group operating profit marginally down to £12.7m (2011: £12.8m)
* £13.1m (21%) reduction in net debt over 12 months to £50.0m (June 2011: £63.1m)
* Net debt has reduced by £45.7m over the last 3 years, a reduction of 48%
* Net finance costs down 12% to £1.6m (2011: £1.8m) * Diluted adjusted earnings per share up by 3% to 8.93p (2011: 8.64p) * Proposed interim dividend of 1.75p (2011: 1.50p)
Operational highlights and prospects
* talkSPORT signed exclusive football deals:
+ Barclays Premier League package of worldwide audio broadcasting rights
(excluding Europe) to 2016 + Commercial radio rights for the FA Cup in the UK and Global rights (including Europe) to 2018 * Acquisition of Simply Zesty - Ireland's leading social media agency
* Successful refinancing of bank facilities with terms, pricing and duration
endorsing the cash generative qualities and balance sheet strength of UTV
* New network arrangements signed with ITV * Continuing strong audience delivery across both Radio and Television
* Revenue growth of 11% in Radio GB and 4% in local currency in Radio Ireland
* Television net advertising revenue down by 3%, compared to the ITV1 Network
which was flat, reflecting the economic environment in Ireland
* Continued significant debt reduction created by strong cash management,
with 1.74 times Net Debt:EBITDA achieved at 30 June 2012 (2011: 2.20 times)
* Appointment of Richard Huntingford as Chairman
(1) As appropriate, references to profit include associate income but exclude exceptional items
John McCann, Group Chief Executive, UTV Media plc, said:
"The Group has posted a resilient performance for the first half of 2012,growing both revenues and pre-tax profits in a choppy market. It has also seenthe business undergo some exciting operational developments, including a newNetwork Affiliate Agreement with ITV; talkSport securing innovativebroadcasting agreements with both the Barclays Premier League and the FootballAssociation; and the acquisition of Simply Zesty, Ireland's leading socialmedia agency. The emphasis on adding value right across UTV's media assets,coupled with disciplined balance sheet improvement, provides a strong platformfor future growth."
For further information contact:
Maitland +44 (0) 20 7379 5151Rowan BrownUTV Media plc
John McCann Group Chief Executive +44 (0) 28 9026 2202
Norman McKeown Group Finance Director +44 (0) 28 9026 2098
Orla McKibbin Head of Communications +44 (0) 28 9026 2188
Chairman's Statement
Introduction
I was delighted and honoured last month to be appointed Chairman of UTV Media plc, a company that I have admired for its achievements for a number of years.
The Group has a high quality portfolio of leading media assets in radio, television and digital media that enjoy strong competitive positions in their respective markets. In addition, it has a highly committed and motivated management team, led by John McCann, with both a strong track record of industry out-performance and a keen focus on financial discipline.
The Group generates strong cashflows from its businesses - even in the most difficult of trading conditions for media companies - which it has sensibly deployed to strengthen significantly its balance sheet over the recent past, whilst also maintaining a dividend return for its shareholders.
Given this, I believe that the Group has a strong platform for future growth,particularly once macro-economic conditions improve. I also hope that my manyyears of media industry and PLC Board experience can bring added value andadditional perspective to the company, for the long-term benefit of itsshareholders.
Results (1)
Radio operating profits in the first six months increased by 14% to £10.0 (2011: £8.8M) which was offset by a reduction in television and new media operatingprofits to £2.1M (2011 : £3.1M) and £0.6M (2011 : £0.9M) respectively. Groupoperating profit, therefore, was marginally lower at £12.7M (2011 : £12.8M).With a reduced net interest charge of £1.6M (2011 : £1.8M) group profit beforetax and exceptional items was 3% higher at £11.2 (2011 : £10.9M). Dilutedadjusted earnings per share were up 3% at 8.93p (2011 : 8.64p)
(1) as appropriate, references to profit include associate income but exclude exceptional items and relate to continuing operations only
Dividend
Your Board's success in reducing net debt has enabled it to adopt a moreprogressive dividend policy over the last two years. While continuing to focuson further debt reduction, and being mindful of the continuing macroeconomicuncertainty, your Board is able to declare a 17% increase in the interimdividend to 1.75p (2011 : 1.50p). This will be paid on 15 October 2012 to allshareholders on the Register at the close of business on 14 September 2012.
Radio (1)
On 17 April 2012, we announced that talkSPORT had agreed a deal with thePremier League for an exclusive package of international audio broadcastingrights for the next four football seasons. On 26 July 2012, we announced thatagreement had been reached with the Football Association for commercial radiorights for the FA Cup both internationally and domestically. These rights willenable us to extend the talkSPORT brand and content beyond the UK. At the timeof writing, we have already announced agreements with the first of ourinternational broadcast partners and have successfully broadcast our firstPremier League matches in English, Mandarin and Spanish.In the UK, investment in sports rights and presenters has firmly establishedtalkSPORT as an attractive proposition for both listeners and advertisers. Thisproposition was enhanced during the Euro 2012 football tournament, helping tolift talkSPORT's revenue for the six months to 30 June 2012 by 16% to £17.2M(2011 : £14.8M). Our local radio stations in GB improved revenue by 3% to £10.7M (2011 : £10.4M). As a result, operating profit at our GB Radio divisionincreased by 18% in the first six months to £6.9M (2011 : £5.8M).In Ireland, the advertising revenue market remained very difficult and isestimated to have been down by as much as 10% in the first half. However, ourvery strong audience delivery in the key urban areas again led to a verysignificant outperformance by our stations which, on a like for like basis,increased revenues by 4%. After the impact of foreign exchange, revenue fromRadio Ireland included within the Group results declined by 1% to £10.8M (2011: £11.0M). Operating profit at our Irish radio stations increased by 10% inlocal currency which, after adjusting for foreign exchange, was pared back to astill encouraging 5% improvement in operating profit to £3.1M (2011 : £3.0M).
Television
A new Network Affiliate Agreement was agreed with ITV plc on 5 March 2012. Thisnew agreement will replace the existing network arrangements which no longerprovide the appropriate structures to govern the broadcasting, new media,technological, and regulatory realities of the modern Channel 3 network. TheNetwork Affiliate Agreement provides for an agreed fixed fee for the purchaseby our television division of multi-platform programme rights to the networkschedule.In our television division, net advertising revenue was down by 3% in the firsthalf of 2012, an underperformance of the ITV1 network, which was flat. Withinthis, our television advertising revenue from London was on a par with the ITV1network while revenue from Ireland was down by 8%. Total television revenue wasdown by 2% to £16.9M (2011 : £17.2M). With much of our cost base linked toinflation indexed network programme costs, television operating profits werereduced to £2.1M (2011 : £3.1M).
New Media
On 6 March 2012, we announced the acquisition of Simply Zesty for an initialconsideration of £1.7M. Simply Zesty, which is based in Dublin, provides socialmedia marketing services to a wide range of clients, with more than 15% of itsrevenues now coming from international clients.Turnover in the New Media division increased to £6.0M (2011 : £5.8M) with £0.6Mdue to the inclusion of Simply Zesty for the first time. Within the total,Internet revenue slipped due to competitive pricing while revenue at our webdevelopment business, Tibus, was maintained. Overall new media operating profitwas £0.6M (2011 : £0.9M).ProspectsAs has been reported by many other media companies, the Olympics did notprovide any performance enhancing effect on advertising revenue and as a resulttrading conditions for the third quarter have been less positive thananticipated. The television airtime market in Ireland continues to be difficultleading to an expected 13% fall in television advertising in the three monthsending 30 September 2012. Irish radio is projected to show a 2% improvement ona like for like basis and GB Radio advertising revenue is expected to increaseby 2% during the three months, despite a strong 2011 Rugby World Cupcomparative. New Media revenue is forecast to be up by 1% on a like for likebasis, excluding Simply Zesty.Looking to the full year, the continuing economic uncertainty is likely to leadto volatility in the advertising revenue market. Both our GB and our Irishradio divisions are expected to continue to outperform their respective marketsfor the rest of the year. However, we would anticipate that with lacklustreconditions in Ireland, our television revenue will underperform the UKtelevision market. Our New Media division will continue to show modest growthfor the remainder of the year.
Board
My immediate priority as Chairman is to restore the Board to full independencefollowing the events of earlier this year; the effects of which I believe mayunfortunately have overshadowed the strong performance of the Group'sbusinesses. I am committed to the highest standards of corporate governance andlook forward to constructive engagement with the company's shareholders. I willbe strengthening the Board with new Non-Executive Director appointments withthe aim of creating an effective, cohesive and balanced board of directors,appropriate to UTV Media's status and scale of ambition as a listed company.Finally, I would like to pay tribute to my predecessor, Helen Kirkpatrick, whosuccessfully steered the Board through the most difficult of circumstances witha wonderful blend of integrity, sensitivity, professionalism and humour.Richard HuntingfordChairman28 August 2012Group Income Statement
for the six months ended 30 June 2012
Results Results before before Exceptional Exceptional Exceptional Exceptional Items Items Total Items Items Total 30 June 30 June 30 June 30 June 30 June 30 June Notes 2012 2012 2012 2011 2011 2011 £000 £000 £000 £000 £000 £000 Continuing operations Revenue 3 61,551 - 61,551 59,103 - 59,103 Operating costs (48,959) (196) (49,155) (46,429) - (46,429) ------- ------- ------- ------- ------- ------- Operating profit from 3 12,592 (196) 12,396 12,674 - 12,674continuing operations before tax and finance costs Share of results of 90 - 90 82 - 82associates accounted for using the equity method ------- ------- ------- ------- ------- ------- Profit from continuing 12,682 (196) 12,486 12,756 - 12,756operations before tax and finance costs Finance revenue 53 - 53 75 - 75 Finance costs (1,651) - (1,651) (1,896) - (1,896) Foreign exchange gain/ 66 - 66 (83) - (83)(loss) ------- ------- ------- ------- ------- ------- Profit from continuing 11,150 (196) 10,954 10,852 - 10,852operations before tax Taxation (2,404) (1,636) (4,040) (2,389) 616 (1,773) ------- ------- ------- ------- ------- ------- Profit from continuing 5 8,746 (1,832) 6,914 8,463 616 9,079operations after tax Discontinued operations Loss from discontinued 4 - - - (213) - (213)operations ------- ------- ------- ------- ------- ------- Profit for the year 8,746 (1,832) 6,914 8,250 616 8,866 ------- ------- ------ ------- ------- ------ Attributable to: Equity holders of the 8,561 (1,832) 6,729 8,083 616 8,699parent Non-controlling interest 185 - 185 167 - 167 ------- ------- ------- ------- ------- ------- 8,746 (1,832) 6,914 8,250 616 8,866 ------- ------- ------ ------- ------- ------ Earnings per share 2012 2011 Continuing operations Basic 7 7.07p 9.34p Diluted 7 7.02p 9.28p Adjusted 7 8.99p 8.70p Diluted adjusted 7 8.93p 8.64p Continuing and discontinued operations Basic 7 7.07p 9.12p Diluted 7 7.02p 9.06p Adjusted 7 8.99p 8.47p Diluted adjusted 7 8.93p 8.42pGroup Statement of Comprehensive Incomefor the six months ended 30 June 2012 30 June 30 June 2012 2011 £000 £000 Profit for the period 6,914 8,866 ------- ------- Other comprehensive income Exchange difference on translation of foreign (1,290) 4,946operations
Actuarial (loss)/gain on defined benefit pension (3,564)
521schemes Cash flow hedges: Loss arising during the year (134) (226)
Less transfers to the income statement 247
312
Tax relating to other comprehensive income 825 (104) ------- ------- Other comprehensive (loss)/income for the year, (3,916) 5,449net of tax ------- ------- Total comprehensive income for the year, net of 2,998 14,315tax ------- ------- Attributable to: Equity holders of the parent 2,813 14,148 Non-controlling interest 185 167 ------- ------- 2,998 14,315 ------- ------ Group Balance Sheetfor the six months ended 30 June 2012 30 30 31 June June December Notes 2012 2011 2011 £000 £000 £000 ASSETS Non-current assets Property, plant and equipment 8 11,566 11,514 11,273 Intangible assets 176,133 228,610 173,776
Investments accounted for using the 216 254
126equity method Deferred tax asset 5,623 6,444 6,511 ------- ------- ------- 193,538 246,822 191,686 ------- ------- ------- Current assets Inventories 352 644 1,533 Trade and other receivables 26,033 25,832
25,857
Cash and short term deposits 14,606 9,862 7,205 ------- ------- ------- 40,991 36,338 34,595 ------- ------- ------- TOTAL ASSETS 234,529 283,160 226,281 ------- ------- ------- EQUITY AND LIABILITIES
Equity attributable to equity holders
of the parent Equity share capital 55,557 55,557 55,557 Capital redemption reserve 50 50 50 Treasury shares (1,523) (1,258) (1,523) Foreign currency reserve 5,881 14,445 7,171 Cash flow hedge reserve (444) (515) (521) Retained earnings 22,439 61,019 22,414 ------- ------- ------- 81,960 129,298 83,148 Non-controlling interest 510 642 469 ------- ------- ------- TOTAL EQUITY 82,470 129,940 83,617 ------- ------- ------- Non-current liabilities Financial liabilities 10 60,622 64,519 53,752
Derivative financial liabilities - 337
207 Pension liability 11 11,170 4,930 8,569 Provisions 744 969 766 Deferred tax liabilities 36,937 37,362 35,932 ------- ------- ------- 109,473 108,117 99,226 ------- ------- ------- Current liabilities Trade and other payables 34,655 33,771 31,948 Financial liabilities 10 3,985 8,444 8,167
Derivative financial liabilities 570 366
479 Tax payable 2,944 2,094 2,409 Provisions 432 428 435 ------- ------- ------- 42,586 45,103 43,438 ------- ------- ------- TOTAL LIABILITIES 152,059 153,220 142,664 ------- ------- ------- TOTAL EQUITY AND LIABILITIES 234,529 283,160 226,281 ------- ------- -------Group Cash Flow
for the six months ended 30 June 2012
30 June 30 June 2012 2011 £000 £000 Operating activities Profit before tax 10,954 10,639
Adjustments to reconcile profit before tax to net cash flows from operating activities Foreign exchange (gain)/loss (66) 83 Net finance costs 1,598 1,821 Share of results of associates (90)
(82)
Depreciation of property, plant and equipment 834
771
Profit from sale of property, plant and (194) (3)equipment Share based payments 283 304 Difference between pension contributions paid (963) (1,349)and amounts
recognised in the income statement
Decrease in inventories 1,181 1,097 Decrease in trade and other receivables 4
2,525
Decrease in trade and other payables (4,786) (1,742) Decrease in provisions (25) (1) ------- ------- Cash generated from operations before 8,730 14,063exceptional costs Exceptional costs (107) - Tax paid (178) (1,118) ------- ------- Net cash inflow from operating activities 8,445 12,945 ------- ------- Investing activities Interest received 64 75
Proceeds on disposal of property, plant and 263
3equipment Purchase of property, plant and equipment (1,184)
(1,242)
Outflow on acquisition of subsidiary (1,670)
-undertaking
Outflow on acquisition of radio licences (180)
- ------- ------- Net cash flows from investing activities (2,707) (1,164) ------- ------- Financing activities Borrowing costs (2,320) (1,916) Dividends paid to equity shareholders (8)
(7)
Dividends paid to non-controlling interests (144)
- Repayment of borrowings (61,416) (11,308) Proceeds from borrowings 65,595 - ------- ------- Net cash flows used in financing activities 1,707 (13,231) ------- ------- Net increase/(decrease) in cash and cash 7,445 (1,450)equivalents
Net foreign exchange differences (44)
62
Cash and cash equivalents at 1 January 7,205 11,250 ------- ------- Cash and cash equivalents at 31 December 14,606 9,862 ------- ------Group Statement of Changes in Equityfor the six months ended 30 June 2012 Equity Capital Foreign Cashflow
Share Non-
share redemption Treasury currency hedge Retained
holder controlling
capital reserve shares reserve reserve earnings equity interest Total £000 £000 £000 £000 £000 £000 £000 £000 £000 At 1 January 55,557 50 (1,258) 9,499 (581) 54,441 117,708 475 118,1832011 ------ ------- ------- ------- ------- ------- ------- ------- ------- Profit for - - - - - 8,699 8,699 167 8,866the period Other - - - 4,946 66 437 5,449 - 5,449comprehensive income in the period ------ ------ ------- ------- ------- ------- ------- ------- ------- Total net 4,946 66 9,136 14,148 167 14,315comprehensive income in the period Share based - - - - - 304 304 - 304payment Equity - - - - - (2,862) (2,862) - (2,862)dividends paid and payable ------ ------- ------- ------- ------- ------- ------- ------- ------- At 30 June 55,557 50 (1,258) 14,445 (515) 61,019 129,298 642 129,9402011 ------ ------- ------- ------- ------- ------- ------- ------- ------- Loss for the - - - - - (34,585) (34,585) 248 (34,337)period Other - - - (7,274) (6) (2,893) (10,173) - (10,173)comprehensive income in the period ------ ------- ------- ------- ------- -------
------- ------- ------- Total net (7,274) (6) (37,478) (44,758) 248 (44,510)comprehensive income in the period Share based - - - - - 301 301 - 301payment Acquisition - - (265) - - - (265) - (265)of treasury shares Equity - - - - - (1,428) (1,428) (421) (1,849)dividends paid ------ ------- ------- ------- ------- ------- ------- ------- ------- At 31 55,557 50 (1,523) 7,171 (521) 22,414 83,148 469 83,617December 2011 ------ ------- ------- ------- ------- ------- ------- ------- ------- Profit for - - - - - 6,729 6,729 185 6,914the period Other - - - (1,290) 77 (2,703) (3,916) - (3,916)comprehensive income in the period ------ ------- ------- ------- ------- ------- ------- ------- ------- Total net (1,290) 77 4,026 2,813 185 2,998comprehensive income in the year Share based - - - - - 283 283 - 283payment Equity - - - - - (4,284) (4,284) (144) (4,428)dividends paid and payable ------ ------- ------- ------- ------- ------- ------- ------- ------- At 30 June 55,557 50 (1,523) 5,881 (444) 22,439 81,960 510 82,4702012 ------ ------- ------- ------- ------- -------
------- ------- -------Notes to the accounts1. Basis of preparation The interim financial statements have been prepared in accordance with IAS34"Interim Financial Reporting" and the Disclosure and Transparency Rules of theFinance Services Authority.
In addition the interim financial statements have been prepared on a basis consistent with the accounting policies set out in the Group's Annual Report and Accounts for the year ended 31 December 2011.
These interim financial statements have been prepared on the going concernbasis as the directors, having considered available relevant information, havea reasonable expectation that the Group has adequate resources to continue inoperational existence for the foreseeable future.The interim results are unaudited but have been formally reviewed by theauditors and their report to the Company is set out at the end of this InterimReport. The information shown for the year ended 31 December 2011 does notconstitute statutory accounts within the meaning of Section 434 of theCompanies Act 2006 and has been extracted from the Group's 2011 Annual Report,which has been filed with the Registrar of Companies. The report of theauditors on the accounts contained within the Group's 2011 Annual Report wasunqualified and did not contain a statement under either Section 498(2) orSection 498(3) of the Companies Act 2006 regarding inadequate accountingrecords or a failure to obtain necessary information and explanations.
2. Seasonality and cyclicality
There is no significant seasonality or cyclicality affecting the interim results of the operations.
3. Segmental information The Group operates in four principal areas of activity - radio in GB, radio inIreland, commercial television and new media. These four principal areas ofactivity also form the basis on which the Group is managed and reports areprovided to the Chief Executive and the Board. The following is an analysis ofthe revenue and results for the period, analysed by reportable segment.
Revenue
Six months ended 30 June 2012
Radio GB Radio Television New Media Total Ireland £000 £000 £000 £000 £000 Sales to third parties 27,862 10,821 16,878 5,990 61,551 Intersegmental sales 406 642 1,455 69 2,572 ------- ------- ------- ------- ------- 28,268 11,463 18,333 6,059 64,123 ------- ------- ------- ------- -------
Six months ended 30 June 2011
Radio GB Radio Television New Media Total Ireland £000 £000 £000 £000 £000 Sales to third parties 25,141 10,976 17,158 5,828 59,103 Intersegmental sales 384 574 1,314 - 2,272 ------- ------- ------- ------- ------- 25,525 11,550 18,472 5,828 61,375 ------- ------- ------- ------- -------ResultsSix months ended 30 June 2012 Radio GB Radio Television New Media Total Ireland £000 £000 £000 £000 £000 Segment operating profit 6,835 3,107 2,075 575 12,592before exceptional costs ------- ------- ------- ------- Associate income 90 ------- Profit before 12,682exceptional costs, tax and finance costs Exceptional costs (196) ------- 12,486 Net finance cost (1,598) Foreign exchange gain 66 ------- Profit before taxation 10,954 -------Six months ended 30 June 2011 Radio GB Radio Television New Media Total Ireland £000 £000 £000 £000 £000 Segment operating profit 5,787 2,960 3,053 874 12,674before exceptional costs ------- ------- ------- ------- Associate income 82 ------- Profit before tax and 12,756finance costs Net finance cost (1,821) Foreign exchange loss (83) ------- Profit before taxation 10,852 -------4. Discontinued operations Discontinued operations in 2011 relate to UTV Interactive Ltd which was closedin February 2011.5. Exceptional items 30 30 June June 2012 2011 £000 £000 International start-up (i) (196) -costs Tax credit associated 48 -with exceptional costs Exceptional tax credit (ii) 751 616 Exceptional tax charge (iii) (2,435) - ------- ------- (1,832) 616 ------- -------
(i) In April 2012, talkSPORT agreed a deal with the Premier League for an
exclusive package of international audio broadcasting rights for the next
four football seasons. The deal will see talkSPORT become a global audio
partner of the Premier League and broadcast commentary outside Europe on all 380 Barclays Premier League games in multiple languages. This deal is the first step in internationalising talkSPORT's brand.
Production of the international output requires an expansion of talkSPORT's
premises and also an increase its editorial and commercial teams. The total
investment in set up and pre-launch costs is expected to be in the region of
£0.8 million to 31 December 2012.
(ii) In the budgets in 2010, 2011 and 2012, changes in future corporation tax
rates in the UK were proposed for the years up to 2014. The exceptional tax
credit of £751,000 (2011: £616,000) arises from the restatement of the relevant
deferred tax balances to reflect the change in the UK corporation tax rate from
25% to 24% with effect from 1 April 2012, which was substantially enacted on 26
March 2012.
On 3 July 2012, the revision of the UK corporation tax rate to 23% from 1 April
2013 was substantially enacted. As a result, it is expected that the deferred
tax will be calculated at 23% at 31 December 2012 and that a further
exceptional deferred tax credit of £751,000 will be recognised in the second
half of the year.
The further proposed changes in the UK corporation tax rate have not yet been
substantively enacted. If the proposed corporation tax rate changes were to be
fully approved and the tax rate reduced to 22% by 2014, the relevant deferred
tax assets and liabilities would be restated accordingly resulting in a net
exceptional credit of approximately £1,300,000 in future periods.
(iii) In the finance bill published on 8 February 2012 and passed into law on 2
April 2012, the rate of capital gains tax in the Republic of Ireland was
increased from 25% to 30%. The exceptional tax charge of £2,435,000 (2011:
£Nil) arises from the restatement of the relevant deferred tax assets and
liabilities to reflect this.
6. Dividends 30 June 30 June 2012 2011 £000 £000 Equity dividends on ordinary shares Declared at the AGM during the period Final for 2011: 4.50p (2010: 3.00p) 4,284 2,862 ------- ------- Proposed but not recognised as a liability at 30 June Interim for 2012: 1.75p (2011: 1.50p) 1,666 1,428 ------- -------
The final dividend for 2011 was paid on 16 July 2012 (2010: 15 July 2011)
7. Earnings per share
Basic earnings per share is calculated based on the profit for the financialperiod attributable to equity holders of the parent and on the weighted averagenumber of shares in issue during the period.Adjusted earnings per share are calculated based on the profit for thefinancial period attributable to equity holders of the parent adjusted for theexceptional items. This calculation uses the weighted average number of sharesin issue during the period.Diluted earnings per share are calculated based on profit for the financialperiod attributable to equity holders of the parent. Diluted adjusted earningsper share are calculated based on profit for the financial period attributableto equity holders of the parent before exceptional items. In each case theweighted average number of shares is adjusted to reflect the dilutive potentialof the awards expected to be vested on the Long Term Incentive Schemes.
The following reflects the income and share data used in the basic, adjusted, diluted and diluted adjusted earnings per share calculations:
Net profit attributable to equity holders
2012 2011 Continuing Discontinued Continuing Discontinued Operations Operations Total Operations Operations Total £000 £000 £000 £000 £000 £000 Net profit/(loss) 6,729 - 6,729 8,912 (213) 8,699attributable to equity holders Exceptional items 1,832 - 1,832 (616) - (616) ------ ------ ------ ------ ------ ------ Total adjusted and 8,561 - 8,561 8,296 (213) 8,083diluted profit/(loss) attributable to equity holders ------- ------- ------- ------- ------- -------
Weighted average number of shares
2012 2011 thousands thousands Shares in issue 95,903 95,903 Weighted average number of treasury shares (700) (500) ------- ------- Weighted average number of shares for basic and 95,203
95,403
adjusted earnings per share (excluding treasury shares) Effect of dilution of the Long Term Incentive Plan 609
609 ------- ------- 95,812 96,012 ------- -------Earnings per share 2012 2011
From continuing and discontinued operations
Basic 7.07p 9.12p ------- ------- Diluted 7.02p 9.06p ------- ------- Adjusted 8.99p 8.47p ------- ------- Diluted adjusted 8.93p 8.42p ------- ------- From continuing operations Basic 7.07p 9.34p ------- ------- Diluted 7.02p 9.28p ------- ------- Adjusted 8.99p 8.70p ------- ------- Diluted adjusted 8.93p 8.64p ------- ------- From discontinued operations Basic and diluted - (0.22)p ------- ------- Adjusted and diluted adjusted - (0.22)p ------- -------
8. Property, plant and equipment
During the period the Group spent £1,271,000 on capital additions.
9. Business Combinations Simply ZestyOn 5 March 2012 the Group acquired the entire issued share capital of SimplyZesty Limited, a company incorporated in the Republic of Ireland. The totalcash consideration paid to date amounts to £1,670,000 and the fair value of theestimated deferred consideration amounting to £3,001,000 was recognised at thedate of acquisition. In line with the terms of the share purchase agreement,contingent consideration is payable over a five year ratchet period to 31January 2017 based on the achievement of future EBITDA targets. The maximumamount of future consideration payable is approximately £3,224,000.
Analysis of the acquisition of Simply Zesty
Provisional fair value £000 Property, plant and 29equipment Debtors 354 Bank Loans (17) Creditors (232) ------- Fair value of net assets 134 Goodwill arising on 4,537acquisition ------- 4,671 ------- Discharged by: Cash 1.671 Accrued consideration 3,001 ------- 4,671 -------
The above fair values are provisional pending the finalisation of the complete fair value exercise in the second half of the year.
Included in the £4,537,000 of goodwill recognised above are certain intangibleassets that cannot be individually separated and reliably measured from theacquiree due to their nature. These primarily relate to the expected value ofsynergies arising from the integration of Simply Zesty with the Group'sexisting new media business and the wider strategic benefits of the acquisitionto the Group.
Details of the revenues and profits of Simply Zesty have not been disclosed as they are deemed to be immaterial.
10. Financial liabilities 30 30 31 June June December 2012 2011 2011 £000 £000 £000 Current
Current instalments due on bank loans 3,985 8,444 8,167 Non-current Non-current instalments due on bank loans 60,622 64,519 53,752
------ ------ ------ 64,607 72,963 61,919 ------ ------ ------
The bank loans at 30 June 2012 are stated net of deferred financing costs amounting to £1,042,000 (30 June 2011: £342,000; 31 December 2011: £249,000).
In May 2012 the Group completed an agreement in respect to the refinancing ofits bank facilities for a five year period maturing in May 2017. The newfacilities comprise a £65m Revolving Credit Facility and a €25m Term LoanFacility. The Term Loan Facility has bi-annual repayments of €2.5m in June andDecember with the first repayment due December 2012.
11. Pension schemes
The IAS 19 deficit at 30 June 2012 is £11,170,000 (30 June 2011: £4,930,000)compared with a deficit of £8,569,000 at 31 December 2011. The increase ispredominately due to an increase in the benefit obligations arising from theadoption of updated longevity assumptions following the completion of thetriennial valuation as at June 2011 and also higher than expected inflation.Employer contributions included £1,181,000 of a discretionary contribution inaddition to normal funding during the period.
12. Related party transactions
The nature of related parties disclosed in the consolidated financialstatements for the Group as at and for the year ended 31 December 2011 has notchanged. There have been no significant related party transactions in the sixmonth period ended 30 June 2012.
Risks and uncertainties
The 2011 Annual Report sets out the most significant risk factors relating to UTV Media plc's operations in the Company's judgement at the time of that report. The Company does not consider that these principal risks and uncertainties have changed. However additional risks and uncertainties not currently known to the Company, or that the Company does not currently deem material may also have an adverse effect on its business.
With respect to the risks and uncertainties identified within the Annual Report, the Chairman's statement highlights those risks and uncertainties that will have significant impact throughout 2012.
Statement of directors' responsibilities
The interim report is the responsibility of, and has been approved by, the directors of UTV Media plc. Accordingly, the directors confirm that to the best of their knowledge:
* the condensed set of financial statements has been prepared in accordance
with IAS 34 "Interim Financial Reporting" as adopted by the European Union;
* the interim report includes a fair review of the information required by
the Disclosure and Transparency Rules:
+ DTR 4.2.7R, 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
+ DTR 4.2.8R, 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. By order of the Board:John McCannGroup Chief Executive28 August 2012
Independent review report to UTV Media plc
Introduction
We have been engaged by the Company to review the condensed set of financialstatements in the half-yearly financial report for the 6 months ended 30 June2012 which comprises the Group Income Statement, Group Statement ofComprehensive Income, Group Balance Sheet, Group Statement of Changes inEquity, Group Cash Flow Statement and the related notes 1 to 12. We have readthe other information contained in the half yearly financial report andconsidered whether it contains any apparent misstatements or materialinconsistencies with the information in the condensed set of financialstatements.This report is made solely to the company in accordance with guidance containedin ISRE 2410 (UK and Ireland) "Review of Interim Financial InformationPerformed by the Independent Auditor of the Entity" issued by the AuditingPractices Board. To the fullest extent permitted by law, we do not accept orassume responsibility to anyone other than the company, for our work, for thisreport, or for the conclusions we have formed.
Directors' Responsibilities
The half-yearly financial report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the half-yearly financial report in accordance with the Disclosure and Transparency Rules of the United Kingdom's Financial Services Authority.
As disclosed in note 1, the annual financial statements of the group areprepared in accordance with IFRSs as adopted by the European Union. Thecondensed set of financial statements included in this half-yearly financialreport has been prepared in accordance with International Accounting Standard34, "Interim Financial Reporting", as adopted by the European Union.
Our Responsibility
Our responsibility is to express to the Company a conclusion on the condensedset of financial statements in the half-yearly financial report based on ourreview.Scope of Review
We conducted our review in accordance with International Standard on ReviewEngagements (UK and Ireland) 2410, "Review of Interim Financial InformationPerformed by the Independent Auditor of the Entity" issued by the AuditingPractices Board for use in the United Kingdom. A review of interim financialinformation consists of making enquiries, primarily of persons responsible forfinancial and accounting matters, and applying analytical and other reviewprocedures. A review is substantially less in scope than an audit conducted inaccordance with International Standards on Auditing (UK and Ireland) andconsequently does not enable us to obtain assurance that we would become awareof all significant matters that might be identified in an audit. Accordingly,we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us tobelieve that the condensed set of financial statements in the half-yearlyfinancial report for the 6 months ended 30 June 2012 is not prepared, in allmaterial respects, in accordance with International Accounting Standard 34 asadopted by the European Union and the Disclosure and Transparency Rules of theUnited Kingdom's Financial Services Authority.Ernst & Young LLPBelfast28 August 2012
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