Final Results
13 April 2010
Totally plc
("Totally", "the Company" or "the Group")
Final Results for the year ended 31 December 2009
Chairman's Statement
In an extremely difficult economic environment I am pleased to be able to
report an excellent set of results for 2009. The turnaround in profitability of
the Group since 2007 has been significant with an improvement of £0.6m profit
from continuing operations.
The Group generated revenues from continuing operations of £1.76m, an increase
of 4% compared to the previous year (2008:£1.69m) and EBITDA from continuing
operations of £0.17m (2008: loss £0.28m) an increase of 666%. Operating profit
before tax from continuing operations of £0.14m (2008: loss £0.06m) an increase
of 344%. Cash generated from operating activities of £0.14m (2008: £0.02m).
I believe this is a truly exceptional achievement in the worst market for many
years and is testimony to the Group's strategy, skills of our staff, and to the
leadership of our business.
Financial Year 2007 2008 2009 08/'09 07/'09
Change Change
Operating (Loss)/Profit (£431,000) (£41,000) £156,000 £197,000 £587,000
EBITDA (£160,000) (£10,000) £185,000 £195,000 £345,000
Cash generated from (£119,000) £23,000 £144,000 £121,000 £263,000
operations
NB: Operating Profit and EBITDA figures in this illustration exclude non-cash
charges for share options (2009 £12,000, 2008:£18,000, 2007: £21,000)
Prospects
Trading since the beginning of the current financial year has been stable and
the Board is optimistic about the Group's trading performance for the full
year.
Dr Michael Sinclair
Non-Executive Chairman
12 April 2010
Further Enquiries
Totally plc
Daniel Assor CEO 020 7692 6929
Merchant John East Securities Limited
Simon Clements/Virginia Bull 020 7628 2200
Chief Executive Officer's statement
I was extremely pleased with the trading performance of the Group in 2009. In
2007 and 2008 a number of cost cutting measures were implemented which allowed
the business to mitigate the downside of expected tough trading conditions.
Revenues increased year on year across both divisions in the Group. The
reduction in the cost base combined with the increase in revenues was
responsible for the 344% increase in operating profit before tax and the
delivery of the best trading performance since 2006.
Publishing Division Overview
The Jewish News & Media Group is the umbrella brand for the group's publishing
businesses which include the Jewish News Limited and TotallyJewish.com Limited.
The group publishes on and offline media for the UK's Jewish community
including:
• A weekly newspaper, `Jewish News'
• A quarterly lifestyle magazine, `Pulse'
• An annual Celebrations magazine, `TotallyJewishSimchas'
• A community portal, `www.TotallyJewish.com'
• An annual Wedding exhibition, www'TotallyJewishSimchas Live!'
Performance Highlights
* Revenues of £1,080,000, + 4.6% yr/yr.
* EBITDA of £252,000, +138% yr/yr. Operating Profit of £228,000, +192% yr/yr
* Operating Profit of £228,000, +192% yr/yr.
Operational Highlights
This division continued to consolidate its growing reputation as the number one
Jewish media organisation in the UK. In 2009 an events division was launched
through a Wedding exhibition, TotallyJewishSimchas.com, at the Village Hotel,
Elstree, Herts. The exhibition was attended by over 1,500 visitors and 80
paying exhibitors.
A series of Q&A sessions with high profile political leaders saw David
Milliband and Boris Johnson face questions from over 150 paying Jewish News
readers and in Q1 2010 Shadow Foreign Secretary William Hague continued this
high profile initiative. An aggressive marketing campaign was launched which
included the creation of a new media pack and website, TheJNgroup.com as well
as individual promotional websites for each of the two magazines in the
divisions portfolio, Pulse (www.JNPulse.co.uk) and TJ Simchas Magazine
(www.TJSimchaMag.co.uk). A show reel promoting the work of the JN Media Group
is expected to be launched in Q2 2010.
Outlook for 2010
The aim is to continue to develop and expand the portfolio including the launch
of an Education exhibition for the Jewish community. Combined with the annual
Wedding exhibition the short to medium term objective is to grow the revenue of
the event division for the events division so that it accounts for 10% of the
publishing division's revenues. Exhibitions are seen as a growth area and
provide a realistic cross selling opportunity to existing clients within the
division.
The annual Celebrations magazine, TotallyJewishSimchas, will be published
quarterly. The lifestyle magazine, Pulse, is already published four times a
year which will mean eight glossy magazines will be published in 2010
Digital Marketing Division Overview
Totally Communications, "TC", the group's digital marketing business with three
main service sectors:
1. Website and software design & development
2. Consultancy & systems integration
3. Online marketing
Performance Highlights
• Revenues of £628,000, +3% yr/yr.
• EBITDA of £210,000, +12% yr/yr.
• Operating Profit of £205,000, +11% yr/yr
Operational Highlights
TC were delighted to have won a multi-agency pitch for celebrity led charity
Global Cool's new website, launched at 2009 London Fashion Week.
During the period under review TC was selected by JP Morgan to construct a
significant system for a mentoring charity, African Caribbean Diversity and
other notable new account wins included a new website for the Barbarians Rugby
Club and a high profile online proposition for the Ghurkha Welfare Trust and
their Debt of Honour campaign which was spearheaded by Joanna Lumley.
Significant research and development was undertaken to develop the `next
generation' of the division's proprietary website content management system,
"Pelorous". The current in-house content management system underpins 80
individual applications and is used daily by over 500 users. Existing users
will be migrated onto Pelorous over the next 12 months and all new clients will
have their website developed through the system. This will give the division an
improved competitive advantage in tenders by deskilling the development process
and reducing the time taken to deliver projects.
Outlook for 2010
Management expect to achieve organic growth in this division in 2010 through
the launch of its new search engine marketing division, RISE Digital,
www.risedigital.com. The development of the RISE brand and communication
materials was undertaken in Q4 in 2009 and launched in Q1 2010.
Consolidated statement of comprehensive income
For the year ended 31 December 2009
Note 2009 2008
£000 as restated
£000
Continuing operations
Revenue 1,758 1,688
Cost of Sales (381) (429)
Gross profit 1,377 1,259
Administrative expenses (1,204) (1,287)
Profit/(Loss) before interest, tax, 173 (28)
depreciation and amortisation
Depreciation (5) (9)
Amortisation (24) (22)
Operating Profit/(Loss) 144 (59)
Finance costs (19) (40)
Profit/(Loss) before taxation 125 (99)
Income tax 4 16 18
Profit/(Loss) for the year from continuing 141 (81)
operations
Discounted operations
Loss for the year from discounted operations - (1,000)
Profit/(Loss) for the year 141 (1,081)
Earnings/(Loss) per share
Basic
Continuing operations 0.002p (0.1p)
Discounted operations - (0.9p)
0.002p (1.0p)
Diluted
Continuing operations 0.001p (0.1p)
Discounted operations - (0.9p)
0.001p (1.0p)
Consolidated Statement of Changes in Equity
for the year ended 31 December 2009
Equity
Share Share Translation Profit shareholders'
capital premium Reserve and loss (deficit)/
account account funds
£000 £000 £000 £000 £000
At 1 January 2008 1,124 3,353 1 (3,947) 531
Prior year adjustment - - - (53) (53)
relating to revenue
recognition
Restated balance 1 1,124 3,353 1 (4,000) 478
January 2008
Loss for the year - - - (1,081) (1,081)
Currency translation - - (1) 1 -
differences on foreign
currency net
investments
Credit on issue of - - - 12 12
share options
Credit on issue of - - - 6 6
warrants
Restated balance at 31 1,124 3,353 - (5,062) (585)
December 2008
Profit for the year - - - 141 141
Credit on issue of - - - 5 5
share options
Credit on issue of - - - 7 7
warrants
At 31 December 2009 1,124 3,353 - (4,909) (432)
Consolidated statement of financial position
at 31 December 2009
2009 2008 As restated As at 1 January
2008
As restated
£000 £000 £000 £000 £000 £000
Assets
Non current assets
Intangible fixed assets 60 51 1,014
Property, plant and equipment 4 7 27
64 58 1,041
Current assets
Inventories - - 8
Trade and other receivables 266 290 433
Cash and cash equivalents - 14 94
266 304 535
Total assets 330 362 1,576
Liabilities
Current Liabilities
Trade and other payables (321) (386) (528)
Short term borrowings (441) (561) (542)
(762) (947) (1,070)
Non-current Liabilities
Investment in joint ventures - - (28)
Total Liabilities (762) (947) (1,098)
Net (Liabilities)/Assets (432) (585) 478
Shareholders' Equity
Called up share capital 1,124 1,124 1,124
Share premium account 3,353 3,353 3,353
Retained earnings (4,909) (5,062) (3,999)
Equity shareholders (deficit)/ (432) (585) 478
funds
Consolidated cash flow statement
For the year ended 31 December 2009
Note 2009 2008
£000 as restated
£000
Operating activities
Operating profit/(loss) from continuing 144 (59)
operations
Option and warrants charge 12 18
Amortisation and depreciation 29 31
Decrease in inventories - 1
Decrease in trade and other receivables 24 64
Decrease in trade and other payables (65) (32)
Cash flow from continuing operations 144 23
Loss before taxation from discontinued - (43)
operations
Depreciation - 3
Movement in working capital from discontinued - 32
operations
Cash flow from discontinued operations 6 - (8)
R&D tax credit 4 16 18
Foreign tax on subsidiary profit - (5)
Net cash flow from operating activities 160 28
Investing activities
Purchase of intangible fixed assets (33) -
Purchase of property, plant and equipment (2) (8)
Cash disposed with subsidiary - (35)
Costs on disposal of subsidiary 6 - (44)
Net cash flow from investing activities (35) (87)
Cashflow/(outflow) before financing 125 (59)
Financing activities
Interest paid (19) (40)
Net cash utilised in financing activities (19) (40)
Net increase/(decrease) in cash and cash 106 (99)
equivalents
Cash and cash equivalents at beginning of year (547) (448)
Cash and cash equivalents at end of year (441) (547)
Cash and cash equivalents comprise:-
Cash and short term deposits - 14
Bank overdrafts (441) (561)
(441) (547)
Notes to the financial statements
For the year ended 31 December 2009
1. General information
Totally Plc is a public limited company ("Company") incorporated in the United
Kingdom under the Companies Act 1985 (registration number 3870101). The Company
is domiciled in the United Kingdom and its registered address is Unit 611
Highgate Studios, 53-79 Highgate Road, London NW5 1TL. The Company's Ordinary
Shares are traded on the AIM Market of the London Stock Exchange ("AIM")
The Group's principal activities have been publishing and the provision of
internet and communication services. The Company's principal activity is to act
as a holding company for its subsidiaries.
2. Authorisation of financial statements and statement of compliance with IFRS
The Company's financial statements for the period ended 31 December 2009 were
authorised for issue by the Board of Directors and the balance sheet was signed
on the Board's behalf by D Assor on 12 April 2010.
The Company's financial statements have been prepared with IFRS and
International Financial Reporting Interpretations Committee ("IFRIC")
interpretations as endorsed by the European Union, and with those parts of the
Companies Act 1985 and 2006 applicable to companies reporting under IFRS. The
Company's financial statements have been prepared on the same basis and as
permitted by Section 408 of the Companies Act 2006 no income statement is
presented for the Company. The Company incurred a loss of £17,000 for the year
ended 31 December 2009 (2008: loss £1,317,000).
3. Basis of preparation
The financial year represents the 365 days to 31 December 2009, and the prior
financial year, 366 days to 31 December 2008. The financial statements are
presented in sterling and all values are rounded to the nearest thousand pounds
(£000) except when otherwise indicated.
The financial statements are prepared on a going concern basis which the
Directors believe to be appropriate for the following reasons. The Group
currently meets its day to day working capital requirements through two
overdraft facilities which are repayable on demand.
The Group has confirmed the availability of a facility of £700,000 with Bank
Hapoalim which was renewed on 8 July 2009 until 30 June 2010. As security for
the facility, the bank has obtained the unlimited Joint and Several Guarantees
of Dr. Michael J. Sinclair (non-executive Chairman), and Mr Leo Noe.
In addition, a working capital facility of £50,000 has been agreed with NatWest
which is secured on the Group's debtor book. This facility is due for renewal
on 31 March 2010.
The Directors have prepared projected cash flow information for the period
ending 12 months from the date of their approval of these financial statements.
On the basis of cash flow forecasts and discussions with the Group's bankers,
the Directors consider that the Group will be able to operate within the
facilities currently agreed.
Inherently, there can be no certainty in relation to these matters, but the
Directors believe that the going concern basis of preparation continues to be
appropriate.
4. Taxation
a) Taxation charge 2009 2008
£'000 £'000
Research and development tax credit (16) (18)
Total current income tax credit charged in the income (16) (18)
statement
b) Taxation reconciliation 2009 2008
The current income tax credit for the period is £'000 £'000
explained below:
Profit/(loss) before tax 125 (1,086)
Taxation at the standard UK income tax rate of 28 per 35 (304)
cent. (2008: 28 per cent)
Research and development tax credit (16) (18)
Deferred tax movement not provided for 35 304
Total income tax credit charged in the income (16) (18)
statement
c) Deferred tax
Estimated tax losses of £3,699,000 (2008: £3,733,000) are available to relieve
future profits of the Group. A deferred tax asset has not been recognised in
respect of these losses due to uncertainty as to the timing and tax rate at
which these losses will be utilised.
5. Share capital and reserves
31 December 31 December
2008
2009
£'000
£'000
Authorised
125,000,000 ordinary shares of 1p each (2008: 1,250 1,250
125,000,000)
20,500,000 deferred shares of 1p each (2008: 205 205
2,050,000)
Allotted, called up and fully paid
91,947,934 ordinary shares of 1p each (2008: 919 919
91,947,934)
20,500,000 deferred shares of 1p each (2008: 205 205
20,500,000)
1,124 1,124
Issue of deferred shares
On 30 September 2008 20,500,000 1p Ordinary Shares were re-designated as
Deferred Shares.
The Deferred Shares issued carry no voting rights, no rights to attend general
meetings of the Company, and no rights to receive dividends. The Deferred
Shares do carry a right to participate in any return of capital to the extent
of 0.01 pence per Deferred Share but only after each Ordinary Share has
received in aggregate capital repayments totalling £1,000,000 per Ordinary
Share.
Earnings per share
The calculation of the basic earnings / (losses) per share is based on the
profit of £141,000 (2008 as restated: loss of £1,081,000) and on 91,947,934
(2008: 107,322,909) ordinary shares being the weighted average number of shares
in issue during the period. The diluted loss per share for 2009 is based on a
profit of £141,000 and 91,947,934 ordinary shares, 16,943,333 outstanding
options and 100,213,012 outstanding warrants. The diluted earnings per share in
2008 is the same as the basic earnings per share. In accordance with IAS 33
which prescribes that potential ordinary shares should only be used as dilutive
when, and only when, their conversion to ordinary shares would decrease net
profit or increase net loss per share from continuing operations.
Share options
On 27 July 2009 7,575,000 share options at an exercise price ranging between
1.5 pence and 4.38 pence per share were surrendered and 10,575,000 new options
were issued at an exercise price of 1 pence per share. The options are
exercisable from the date of issue up to 27 July 2019.
On 8 October 2009, 1,050,000 share options at an exercise price ranging between
1.5 pence and 3.62 pence per share were surrendered and a further 3,050,000
share options were issued at an exercise price of 1 pence per ordinary share.
The options are exercisable from the date of issue up to 8 October 2019.
In summary at 31 December 2009, there are 16,943,333 options still in issue.
Warrants currently in issue
On 21 May 2002, in conjunction with a share placing, subscribers to the placing
shares were issued 4,583,329 warrants (one warrant for every four shares
subscribed). The warrants are exercisable at 5 pence per ordinary share. The
warrants are exercisable in the 45 day periods following either publication of
the Company's half year results or adoption of the Company's annual accounts.
The last exercise period is the earliest of either the 45 day period following
the adoption of the Company's accounts for the year ended 31 December 2008 or,
subject to certain exceptions, on a winding up of the Company where there is a
surplus payable to the ordinary share holders.
On 18 June 2004, 10,000,000 warrants were issued at an exercise price of 5
pence per ordinary share and 4,394,350 warrants were issued at an exercise
price of 4.375 pence per ordinary share. The warrants are exercisable from the
date of issue up to 18 June 2011. The 4,394,350 warrants have been cancelled on
30 September 2008 as part of the disposal of The Jewish Advocate Publishing
Corporation.
On 30 September 2008 70,000,000 warrants were issued at an exercise price of 1
pence per ordinary share. The warrants are exercisable from the date of issue
and have no fixed expiry date.
On 27 July 2009, 6,752,538 warrants at an exercise price ranging between 1.5
pence and 4.38 pence were surrendered and 16,752,538 new warrants were issued
at an exercise price of 1 pence share. The warrants are exercisable from the
date of issue up to 27 July 2019.
On 8 October 2009 166,666 warrants were issued at an exercise price of 1 pence
per ordinary share. The warrants are exercisable from the date of issue up to 8
October 2019.
In summary at 31 December 2009, there are 100,123,012 warrants still in issue.
Share premium account
The share premium account represents the amounts received by the Company on the
issue of Ordinary Shares that are in excess of the nominal value of the issued
shares.
6. Notes to the cash flow statement
2009 2008
£'000 £'000
(i) Cash flows relating to discontinued operations
Cash flows from operating activities
Loss before taxation from discontinued operations - (43)
Depreciation - 3
Decrease in inventories - 6
Decrease in trade and other receivables - 28
Increase in trade and other payables - (2)
- (8)
Foreign tax on subsidiary profit - (5)
Net cash utilised by operating activities - (13)
Cash flows from investing activities
Purchase of non current assets - -
Cash disposed with subsidiary - (35)
Net cash utilised by investing activities - (35)
Cash flow before financing - (48)
Cash flows from financing activities
Interest received - -
Net cash from financing activities - -
Net decrease in cash and cash equivalents - (48)
Cash and cash equivalents at beginning of year - 48
Cash and cash equivalents at 31 December 2009 - -
7. Related party transactions
The Group has taken advantage of the exemption available under IAS 24, "Related
Party Disclosures", not to disclose details of transactions with its subsidiary
undertakings.
The following related party transactions have been carried out at arms length
and are required to be disclosed in accordance with IAS24.
As set out in note 1, Dr Michael Sinclair, and Mr Leo Noe have provided
guarantees in respect of the Group's current overdraft facility.
In 2009, purchases of £2,000 (2008: £4,000), on an arm's length basis were made
from J Margolis, mother of A Margolis who is a director of Totallyjewish.com
Limited. A balance of £nil (2008: £1,000) is included in trade creditors at the
year end.
Included in trade debtors is an amount of £15,000 (2008: £30,000) due from
Totally Jewish Travel Inc., a company in which the Group had a joint venture
interest, that was sold during 2008. Sales of £5,000 (2008: £54,000) relating
to system support have been made in the year. Balances of £nil due from Totally
Jewish Travel Inc. (2008: £18,000) have been written off during the year.
During 2009, 9,080,633 warrants (2008: nil) and 5,450,000 options (2008: nil)
have been granted to D Assor. The exercise prices are 1 pence per option and
per warrant.
During 2009, 7,671,905 warrants (2008: nil) and 5,125,000 options (2008: nil)
have been granted to A Margolis. The exercise prices are 1 pence per option and
per warrant.
During 2009, no warrants (2008: 35,000,000) have been granted to Dr M Sinclair.
The exercise price is 1 pence per warrant.
8. Contingent liabilities
The company is party to a group banking arrangement with NatWest Bank Plc which
includes a debenture, unlimited corporate guarantee and letters of offset
between Totally Plc, Totally Communications Limited, The Jewish News Limited
and TotallyJewish.com Limited. Totally Plc has a contingent liability in
respect of these borrowings which at 31 December 2009 amounted to £nil (2008: £
nil).
9. Dividend
The Directors do not propose the payment of a dividend.
10. Copies of Report and Accounts
Copies of the Report and Accounts will be posted to shareholders shortly, will
be available from the Company's registered office Unit 611 Highgate Studios,
53-79 Highgate Road, London NW5 1TL and are available from the Company's
website www.totallyplc.com.
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