29th Apr 2005 07:11
Future PLC29 April 2005 29 April 2005 FUTURE PLC Trading Update This trading update provides an overview of Future's revenues and generaltrading for the six months ended 31 March 2005 ('the first half'). All revenuegrowth figures are given year-on-year and in constant currency. Trading for the first half (October to March) has been satisfactory. Total Group revenue was up 6%, reflecting strong growth in the Group'sentertainment titles (up 25%) and reasonable growth in games titles (up 3%), anda decline in computing magazine revenues of 3%. Like-for-like Group revenue (excluding acquisitions made during the six monthsto 31 March 2005) increased by 4%. Both circulation and advertising revenue grew by 6%. The two largest businessesin the UK and US each achieved revenue growth of 8%. Revenue performance for the first half (October to March) can be analysed asfollows: Territory Growth Growth (sterling) (constant Proportion of currency) GroupUK + 8% + 8% 53%US + 2% + 8% 26%Mainland Europe + 1% + 1% 21%Total Group + 5% + 6% 100% Sector Growth Growth (sterling) (constant Proportion of currency) GroupGames + 1% + 3% 44%Computing - 4 % - 3% 28%Entertainment + 23% + 25% 28%Total Group + 5% + 6% 100% The average value of the Dollar against Sterling declined by 6% compared withthe first half last year, so that our revenue growth in Dollar terms wasstronger than that reported in sterling. The average value of the Euro againstSterling in the half-year strengthened by less than 1%. UK business UK turnover for the half-year rose by 8%, reflecting organic growth andincreased activity levels in terms of both acquisition and launches during thehalf-year. We continued to diversify our UK portfolio, including theacquisition of 11 motoring titles, two parenting titles, a wedding title and onecomputing title. This portfolio expansion is also reflected in our launchprogramme, which includes Simply Knitting, Computer Upgrade and PapercraftInspirations. US business US turnover also rose by 8%. We continued to diversify our US portfolio, whichnow serves four special-interest areas: games, computing, music and actionsports. We established our action sports division, based in San Diego, in thefirst half, acquired Snowboard Journal and will launch Future Snowboarding inthe late summer. Future Music was launched in March and during the second halfwe will launch Scrapbook Answers. We are increasing our internet presence andthis will result in increased spending in the second half. While these stepsmay hold back profitability in the short term, they represent a continuingbroadening of the US business. Mainland Europe Turnover in Mainland Europe grew by 1%. In March, we launched a new computingtitle, Micro Actuel, in France. This is our largest magazine launch this yearin the Group. Agreement to buy 38 Highbury titles for £30.5 million In a separate announcement today, Future has announced that it has entered intoan agreement with the Board of Highbury House Communications plc ("Highbury") toacquire 38 magazine titles, and associated assets, for a cash consideration of£30.5 million, which will be funded from Future's committed bank facilities. The titles being acquired include Fast Car, Fast Bikes, DJ, DVD Review, the WhatVideo group of magazines and Highbury's puzzle magazines. Additionally, thedeal includes Highbury's US business which publishes five magazines. Highburymanagement accounts for the year ended 31 December 2004 show that: (a) theassets being acquired generated unaudited aggregated turnover of approximately£34.1 million; and (b) the unaudited aggregated profit (before interest,taxation and amortisation) attributable to these assets was approximately £5.3million. Future anticipates that a number of the benefits identified in relation to itsprevious offer for the whole of Highbury, in particular further diversificationof Future's portfolio and the benefits from increased financial and operationalscale, are applicable to the acquisition of these Highbury assets. None of the titles being acquired is a games title. As a result of this deal,the estimated split of the Group's revenues is likely to become Games 38%;Entertainment 34%; and Computing 28%. Outlook Trading for the half-year to March has been satisfactory and, as previouslyannounced, the Board will consider the introduction of an interim dividend, whenthe interim results are announced on 14 June 2005. The Board anticipates a satisfactory out-turn for the Group as a whole for thefinancial year to 30 September 2005. Enquiries: Future plc Greg Ingham, Chief Executive Tel: 01225 442244 John Bowman, Finance Director Tel: 01225 732281 Hogarth Partnership James Longfield/Georgina Briscoe Tel: 020 7357 9477 About Future Future plc was founded in the UK in 1985. Today, it publishes over 100special-interest consumer magazines worldwide with strong portfolios in thecomputing, games, music, sports, motoring, crafts and leisure sectors. Futureemploys 1,200 people in offices in the UK, US, France and Italy. Over 100international editions of Future's magazines are also published under licence in30 other countries across the world. The company is listed on the London StockExchange (symbol FUTR). Financial performance of Future Future's financial year now ends on 30 September. For the twelve months ended30 September 2004, the Future group generated profit before taxation andamortisation of £23.6m on turnover of £190.4m. At 30 September 2004 Future hadnet cash balances of £9.8m. Aborted bid for Highbury House Communications plc ("Highbury") On 14 February 2005, Future announced a recommended share offer (with a partialcash alternative) to acquire the whole of Highbury. This was a Class Onetransaction for Future and shareholders in Future voted in favour of it at anEGM held on 31 March 2005, when more than 80% of all shares in Future were votedand of these, more than 99.9% were in favour. On 14 April 2005, the Office of Fair Trading announced that it had referred therecommended share offer to the Competition Commission. On 15 April 2005, Futureannounced that it no longer intended to pursue this transaction. On 28 April2005 the Competition Commission announced that it had formally cancelled thereference. Future will treat the costs incurred in connection with this abortedbid as an exceptional item in its interim results. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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