Interim Results 2006
Embargoed: 07:00hrs 11th September 2006
International Brand Licensing plc
("IBL" or the "Company")
Interim Results for the 6 month period ended 30 June 2006
Chairman's Statement
I am delighted to announce IBL's interim results for the six months to 30th
June 2006. These results demonstrate a continuation of growth from the
corresponding period last year, with turnover up 19% (from £1,456,000 to £
1,738,000) and pre-tax and pre-exceptional profit up 211% (from £101,000 to £
314,000).
Earnings per share for the period was 1.0p (2005: 1.3p) and if the performance
of the Group continues to show strong growth, it is the Board's intention to
pay a maiden dividend in the 2007 financial year.
This represents a particularly strong performance in light of the fact that
last year we had the Ashes series in England and our licensing revenue was
boosted in the first half with new contract advances. This demonstrates the
robustness and controls that have been put in place during the past twelve
months.
Your Board is working tirelessly to grow and further establish the Admiral
brand around the world. The potential growth from our existing territories,
potential new territories and the recent launch of our on-line e-commerce site
www.admiralsportswear.com is substantial.
We are currently in negotiations with regards to a number of corporate
transactions, which if they were to complete would have a significant effect
upon the Group. These are all at an early stage and shareholders will be kept
fully informed of developments.
The goal for the first twelve months of my tenure as Chairman was to stabilise
the business. This is now complete and the second phase is well under way to
grow the business and deliver greater shareholder value.
Your Board views the future with confidence and believes we will see continued
growth going forward.
Adam Reynolds
Chairman
8th September 2006
Group Profit And Loss Account
For The Period Ended 30 June 2006
6 month period 6 month period Year ended
ended 30 June ended 30 June
2006 2005 31 December
2005
Notes £000 £000 £000
(Unaudited) (Unaudited) (Audited)
Turnover 1,738 1,456 3,261
Cost of Sales (813) (521) (1,286)
Gross Profit 925 935 1,975
Exceptional cost of 2 (139) - -
share awards
Other administrative (609) (770) (1,402)
expenses
Operating Profit 177 165 573
Exceptional profit on 201 534 475
sale of intangible fixed
asset
Interest receivable - - 6
Interest payable and (2) (64) (77)
similar charges
Profit on ordinary 376 635 977
activities before tax
Tax on profit on 3 (33) (189) (142)
ordinary activities for
the period
Retained Profit for the 343 446 835
period
Earnings per ordinary
share
ï¼ basic 4 1.0p 1.3p 2.5p
ï¼ diluted 4 1.0p 1.3p 2.5p
Group statement of total recognised gains and losses
6 month period 6 month period Year ended
ended 30 June ended 30 June
2006 2005 31 December
2005
£000 £000 £000
(Unaudited) (Unaudited) (Audited)
Profit for the period 343 446 835
Exchange differences 3 (276) (236)
Total recognised gains 346 170 599
relating to the period
Group Balance Sheet
at 30 June 2006
30 June 2006 30 June 2005 31 December 2005
£000 £000 £000
(Unaudited) (Unaudited) (Audited)
Fixed assets
Intangible assets 2,964 3,391 3,471
Tangible assets 9 12 9
2,973 3,403 3,480
Current assets
Stock 505 329 252
Debtors 1,925 1,612 828
Cash at bank and in 271 63 283
hand
2,701 2,004 1,363
Creditors: amounts (1,530) (2,122) (1,129)
falling due within
one year
Net current assets/ 1,171 (118) 234
(liabilities)
Total assets less 4,144 3,285 3,714
current liabilities
Capital and reserves
Share capital 333 333 333
Share premium 3,048 3,048 3,048
Merger reserve 244 244 244
Profit and loss 519 (340) 89
account
Equity shareholders' 4,144 3,285 3,714
funds
The financial statements were approved by the Board on 8th September 2006
and signed on its behalf by:
Paul Foulger
Finance Director
Group statement of cash flows
for the period ended 30 June 2006
6 month period 6 month period Year Ended 31
ended 30 June ended 30 June December
2006 2005
2005
Notes £000 £000 £000
(Unaudited) (Unaudited) (Audited)
Net cash (outflow)/ 5(a) (762) 21 111
inflow from operating
activities
Returns on investments
and servicing of
finance
Interest paid (2) (67) (80)
Interest received - - 6
Taxation
UK tax received/(paid) 33 - (59)
Foreign taxes (paid)/ (55) - 48
received
Capital expenditure
and financial
investment
Purchase of intangible (13) (41) (37)
fixed assets
Purchase of tangible (3) - -
fixed assets
Proceeds from sale of 721 2,639 2,772
intangible fixed asset
Net cash(outflow)/ (81) 2,552 2,761
inflow before
financing
Financing
Repayment of bank - (2,563) (2,563)
borrowings
Net cash outflow from - (2,563) (2,563)
financing
(Decrease)/increase in 5(b) (81) (11) 198
cash in the period
Notes to the Interim Report
at 30 June 2006
1.Basis of preparation and abridged accounts
The financial information for the 6 months ended 30 June 2006 is prepared under
the historical cost convention and in accordance with applicable United Kingdom
law and accounting standards and has been prepared on the basis of the
accounting policies set out in the group's statutory accounts for the year
ended 31 December 2005 and is unaudited.
The financial information set out on pages 2 to 5 does not constitute full
financial statements as defined in section 240 of the Companies Act 1985. The
financial information for the full preceding year is based on the statutory
accounts for the financial year ended 31 December 2005. These accounts, upon
which the auditors issued an unqualified opinion, have been delivered to the
Registrar of Companies.
Intangible assets
Intangible assets represent acquired trademarks and are recorded at historic
cost. No amortisation is charged as they are regarded as having infinite lives.
The results reflect the significant expenditure incurred in the support and
development of these brands. In addition, the trademarks are supported by the
existence of international licensee agreements, which establish obligations as
to guaranteed minimum license income and marketing arrangements with the view
to maximising long-term growth. The directors believe that the license
agreements will be renewed at the end of their legal expiry dates and that the
value of the trademarks will be maintained. The carrying values are reviewed
annually in accordance with Financial Reporting Standard No. 11 "Impairment of
fixed assets and goodwill" with a view to write down if impairment arises.
Stock
Stocks are stated at the lower of cost and net realisable value.
2. Exceptional Costs
The exceptional charge to the profit and loss account of £139,000 represents
the costs of share options and other awards to directors and others and is
necessary to comply with Financial Reporting Standard No. 20 `Share-Based
Payment'. Tax relief is not available on the cost of share awards until
exercise or other realisation and a deferred tax asset has therefore been
recognised for the potential relief.
3. Tax
The tax charge for the six month period ended 30 June 2006 is calculated on the
basis of the estimated effective tax rate for the full year.
4. Earnings per ordinary share
6 month period 6 month period Year ended 31
ended 30 June 2006 ended 30 June 2005 December 2005
No. No. No.
Weighted average 33,343,353 33,343,353 33,343,353
ordinary shares in
issue during the
period
Dilutive effect of 9,438 329,005 4,056
share options
Diluted weighted 33,352,791 33,672,358 33,347,409
average ordinary
shares
£000 £000 £000
Net profit for the 343 446 835
financial period
Pence Pence Pence
Basic earnings per 1.0 1.3 2.5
1p ordinary share
Diluted earnings 1.0 1.3 2.5
per 1p ordinary
share
5. Notes to the statement of cash flows
(a) Reconciliation of operating profit to net cash inflow/(outflow) from
operating activities
6 month period 6 month period Year ended 31
ended 30 June 2006 ended 30 June 2005 December 2005
£000 £000 £000
Operating profit 177 165 573
Depreciation 3 1 6
Increase in debtors (1,112) (1,248) (379)
Increase in stock (253) (112) (35)
Increase/(decrease) 336 985 (39)
in creditors
Gain/(loss) on 3 (304) (15)
exchange
Exceptional profit - 534 -
on sale of
intangible asset
Increase in equity 84 - -
- share option
award
(762) 21 111
b. Reconciliation of net cash flow to movement in net debt
6 month period 6 month period Year ended 31
ended 30 June ended 30 June December
2006 2005 2005
£000 £000 £000
(Decrease)/increase (81) (11) 198
in cash in the
period
Decrease in bank - 2,563 2,563
borrowings
Change in net debt (81) 2,552 2,761
arising from cash
flows
Net debt at 272 (2,489) (2,489)
beginning of period
191 63 272
c) Analysis of net debt
At 1 January 2006 Cash Flows At 30 June 2006
£000 £000 £000
Cash at bank 283 (12) 271
Bank borrowings (11) (69) (80)
272 (81) 191
For further information please contact:
Adam Reynolds, Chairman
Paul Foulger, Finance Director
International Brand Licensing Plc
+44 (0)20 7245 1100