Interim Results
TRINITY PLC
6 August 1999
Interim Results 1999
Trinity plc ('Trinity'), the regional newspaper publishing group, announces
record interim profits for 1999.
Highlights 1999 1998 % change % change
(underlying)*
Turnover £168.0m £174.3m -3.6% +3.8%
Operating profit £44.7m £40.9m +9.2% +14.0%
Profit before tax £42.5m £36.2m +17.5% +22.8%
Earnings per share 21.1p 17.9p +17.9%
Dividend per share 4.8p 4.4p +9.1%
* Underlying change excludes results of the US division sold in 1998.
- Underlying revenue growth of 3.8% achieved
- Other revenues now represent 5.0%, (1998 4.0%), of group turnover
- Operating margins continue to improve, up from 23.5% to 26.6%
- Gearing reduced from 31.4% to 14.2%
Earnings per share up 17.9%
Enquiries:
Philip Graf/Mike Masters
Trinity plc Tel: 01244 687000
Richard Constant/Deborah Walter
Gavin Anderson & Company Tel: 0171 457 2345
Financial Summary
The reduction in turnover of 3.6% is due to the sale of the US operations in
1998. Underlying turnover, excluding US, increased by 3.8% to £168.0m.
At the operating profit level the group achieved an underlying growth of 14.0%
over the comparable period. The reported profit before tax of £42.5m for the
current period represents an underlying increase over 1998 of 22.8%.
Earnings per ordinary share rose from 17.9p (1998) to 21.1p (1999).
The Board has recommended an interim net dividend of 4.8p, which represents an
increase of 9.1% on the interim dividend paid in 1998. The dividend will be
paid on 29 October 1999 to shareholders on the register on 13 August 1999.
Discussions with Mirror Group
Shareholders will be aware that on 1 March, Trinity announced that it had
approached the Mirror Group, 'Mirror', with regard to making an offer for
Mirror. Prior to any offer being made the consent of the Secretary of State
for Trade and Industry is required in accordance with the 1973 Fair Trading
Act.
On 23 July 1999 the Secretary of State for Trade and Industry announced that
he was giving consent to Trinity for the proposed transfer of the newspaper
titles currently published by Mirror to Trinity on the condition that it
divests its four Northern Ireland titles (the Belfast Telegraph, Sunday Life,
Community Telegraph and Farm Trader) and their related newspaper assets. A
draft of the conditions to the consent was published on the same day and
interested parties were requested to comment on the wording by 6 August 1999.
We announced on 30 July an agreed merger with Mirror.
We have received a number of expressions of interest from various parties with
regard to the acquisition of our Northern Ireland business. We are also
satisfied that the divestment of this business can be achieved efficiently and
on favourable terms.
Trading
Trinity has enjoyed yet another period of record trading. This was achieved
despite the slow down in the economy, as anticipated, although the period
ended strongly. The results also reflect the benefit of the actions initiated
across the group towards the end of 1998.
Revenues
Our core revenue grew much in line with expectation but it has been pleasing
to see the development of new revenue streams which have helped us to achieve
an overall increase in turnover of 3.8%.
Advertising
Group revenues grew by 2.7%. In our UK Newspapers, display and classified
revenues both grew by 2.2%.
We saw growth in all our major classified categories. Recruitment revenues
grew by almost 1%, motors grew by 1.8% in a very competitive and changing
marketplace. Property, which was the most consistent category across the
whole group, grew by 6.3%.
AMRA, which we acquired in November 1998 to represent the group's titles at a
national level, has integrated well and helped us achieve national display
growth of 9%. After an encouraging first quarter, local display revenues
finished 0.9% down on last year. April and May were particularly difficult,
whilst June saw a noticeable improvement.
Circulation
Circulation revenues increased by 1.8% mainly reflecting cover price increases
implemented at the end of 1998.
Overall the morning titles were down by 2.8%. Competitive pressure increased
in the sector from both mid-market and tabloid national titles.
The evening titles showed a reduction of 3.4% for the period up against a
strong performance in the first half of 1998.
UK Sunday sales were down by 3.6%. Sunday Life was affected by changes in
lifestyle patterns in a more peaceful Northern Ireland. The elimination of a
non-profitable edition affected the Sunday Sun, whilst Wales on Sunday had a
particularly strong half year, up 5.1%. The Sunday Business Post continues to
grow, increasing by a further 2% on last years significant growth.
It was encouraging that more than half our weekly titles showed year on year
gains, although overall sales were 0.8% down on the previous year.
Other Revenues
As a result of increased pagination and extra volumes from the nationals,
contract printing revenues grew by 9.8% optimising the utilisation of the
group's printing facilities.
Other revenues which include on-line, leaflets, our national representation
sales house and regional magazines, grew by 28.3% with the expansion of new
media making a significant contribution. As a result 'other revenues' now
represent 5% of turnover, compared with 4% last year.
Operating Costs
Staff costs increased by 5.5% reflecting sustained investment in new media,
our magazines and Ireland. The underlying increase in the core newspaper
business has been held to 2.2% despite expansion of new products and increased
systems development.
Newsprint, the group's major raw material cost, decreased by 5.8% due to a
further reduction in the underlying price. Newsprint tonnes consumed reduced
by 2.5% due mainly to careful management. The market for newsprint remains
helpful with an expectation of further limited reductions in newsprint prices.
Other costs have been reduced by 2.1% through tight cost control thereby
absorbing increased activity levels that have impacted on external printing
and distribution costs. The core cost base is being actively reduced making
way for further investment in new media.
Depreciation charges rose by 11.6% reflecting the recent capital expenditure
on replacement systems and press investment.
Investment and Capital Expenditure
The capital investment in 1999 is forecast at £23.5m with £13.8m spent in the
first half on upgrading of press facilities and replacement editorial,
advertising and accounting systems, to facilitate digitisation as well as
providing a high level of confidence on Year 2000 compliance.
Depreciation for the period was £7.0m (1998 £6.6m).
Cash flow and financing
The group continued to produce strong cash flows from continuing operating
activities with an increase of 4.2% to £39.2m. Net debt, including finance
leases of £50.8m, reduced by £8.5m to £57.2m with gearing having fallen to
14.2% (1998 31.4%).
Operations
Most United Kingdom businesses achieved record profits for the half year.
Despite more difficult trading conditions in certain markets, our publishing
operations in the South East achieved strong operating profit growth and
improved margins. Excellent control of costs played a key role in achieving
this result.
Meanwhile in South Wales a strong revenue performance, driven by product
innovation combined with tightly controlled costs, delivered profit growth of
16.5% and a record return on sales. The Welsh Assembly and the forthcoming
Rugby World Cup make this a buoyant year for Wales.
In the North-West, advertisement revenues struggled to exceed the previous
year's levels, although the trend improved as the half-year approached. The
major programme of upgrades of systems in all the businesses, and of presses
in Liverpool and Chester, continued to be implemented and the benefits will
start to be seen from 2000 onwards. Particularly noteworthy during the period
were the circulation performances of the Liverpool Echo and the paid-for
weekly titles, and the recognition of excellence through a clutch of
prestigious awards.
In Scotland, the new management team has made very good progress despite a
slowing down of the economy in the second quarter. Circulation performance
remains impressive and fifteen out of twenty one titles will show growth
despite cover price increases on most titles. We have recently completed an
agreement to print later week Scottish editions of The Sun which will help
profits in the second half.
The anticipated slowdown affected the North East of England in the second
quarter after a good first quarter. However, cost reduction activity late in
1998, coupled with cover price increases and buoyant contract print revenues
at Newcastle helped both of Trinity's businesses in Newcastle and on Teesside
to achieve healthy profit and margin growth. The Journal (Newcastle) was also
named BT UK Newspaper of the Year.
Whilst uncertainty continues to surround the peace process, this was not
reflected in our Belfast business which delivered a very strong performance.
Ireland
The Sunday Business Post's performance reflects the strength of the Irish
economy and the continued commercial development of the newspaper.
Magazines
The first six months of 1999 saw difficult trading conditions for our magazine
business, particularly in the IT market place. Although overall revenues grew
by 5.9% this was below our expectations.
Interactive Media
Trinity confirmed its position as the strongest regional publisher online with
further increases in traffic. Our Belfast and Cardiff operations led the way,
registering 1.5m and 1m page views per month, respectively, to help us to
achieve 5.9m page views Trinity-wide by the end of the period.
Trinity's strategy is to build dominant local online franchises, form national
alliances to secure distribution for them, and develop national niche
businesses using content from our own sites aggregated with that of our
partners. Our ADHunter online classifieds alliance, with other regional
publishers, exemplifies our exploitation of national niches by delivering
growing traffic to jobs and motors sites each of which now boasts the largest
database of ads in its category.
Trinity's newest national alliance, announced in May, is This Is Britain, a
partnership with Northcliffe, Newsquest and Associated New Media to create a
UK network of local information sites. A chief executive has been appointed
and This Is Britain intends to be a major player in marketing our sites to
online distributors and creating a powerful medium for attracting national
advertising.
Trinity is committed to integrating e-commerce into its web sites and is
presently considering which platforms and suppliers will provide the best
solution to successfully deliver the important revenue opportunities which e-
commerce provides.
The popularity of Trinity's sites, the strength of our national alliances and
our commitment to investing in this burgeoning medium leave us well placed to
seize the opportunities which are emerging.
Industry Consolidation
The need to embrace the new media opportunities and to maintain plurality will
require a well focused and financially strong newspaper industry. This will
only be achieved through a further consolidation of ownership with Trinity
well placed to participate fully in this to enhance shareholder value.
Interest in the regional newspaper industry remains as strong as ever, as
evidenced by the recent offer by Gannett for Newsquest plc.
The current competition regime allows overseas buyers and venture capitalists
to acquire newspaper assets without a reference to the Competition Commission.
This is unfair to existing owners as they seek to develop a strong and
focussed industry to meet the challenges we face. We will continue to seek to
persuade the government to change the existing legislation.
Strategy
The future for regional newspapers remains good despite increasing competition
from niche publications and new media.
Trinity's strategy continues to be one of maintaining and developing our
existing franchises whilst seeking to acquire new brands which offer value to
our shareholders and further the scale of the group.
Within our existing franchises, we continue to invest both in our products and
people, balancing the drive for short-term profitability against the longer-
term development of our brands and franchises. This commitment is
demonstrated through product investment in colour and editorial paging, the
launch of new products, in investigating and trialing new media opportunities,
and through the extensive investment in the training of our people.
People
Once again I am delighted to offer my congratulations and thanks to all the
people in Trinity who have contributed to another very successful period and
at the same time have picked up a considerable number of prestigious industry
awards.
Year 2000
The group identified during 1997 the issue of possible date problems arising
in its computer systems following the change of century. The consequences of
these potential malfunctions to both Trinity and externally could result in
widespread commercial disruption. Following the recognition of this complex
and extensive issue, each subsidiary company drew up a risk register and
assessment that identified all the key areas of concern within their business
as well as those that related to both key customers and suppliers.
A major year 2000 programme was subsequently implemented which was approved by
the Board. This included a complete inventory of systems and other equipment
that may have date related functionality. Systems have been replaced,
upgraded, certified and tested to ensure year 2000 compliance. Contingency
plans have also been drawn up to ensure business continuity in the event of
any unexpected failures.
In addition all our key customers and suppliers have been contacted about
their own compliance programmes which has resulted in site visits by our own
internal year 2000 project team and a review of the programmes being
implemented in a number of these businesses.
The group are on schedule to complete the remaining year 2000 projects and
testing by the end of September 1999.
Given the complexity of the problem it is not possible for any organisation to
guarantee that no year 2000 problems will remain as potentially some level of
failure may still occur. Overall, however, the Board believes that the group
has achieved a high state of readiness and considers that the contingency
planning, which has already been put in place, will reduce the impact of any
failures subsequently arising.
The costs to date of implementing the action plans have been expensed as
incurred, where appropriate, in the accounts up to the period ending 27 June
1999. The remaining costs to complete the group's year 2000 programme are not
expected to be material.
Outlook
The actions taken by the group towards the end of 1998 have lead to both
profit growth and margin enhancement. We remain confident of a satisfactory
outturn for the year.
The current sizeable investment programme in our business will come to an end
in 1999 but, as appropriate, we will continue to invest to ensure our
facilities provide the best possible platform to both sustain our existing
franchises and to maximise on the revenue opportunities from the developing
digital markets.
GROUP PROFIT AND LOSS ACCOUNT
26 weeks 26 weeks 52 weeks
ended ended ended
27 Jun 28 Jun 27 Dec
1999 1998 1998
£'000 £'000 £'000
TURNOVER
Continuing operations 167,955 161,756 321,258
Discontinued operations 0 12,548 21,174
------ ------ ------
167,955 174,304 342,432
Cost of sales (77,590) (82,589) (165,721)
------ ------ ------
Gross profit 90,365 91,715 176,711
Net operating (45,690) (50,811) (100,076)
expenses ------ ------ ------
OPERATING PROFIT
Continuing operations 44,675 39,192 73,483
Discontinued operations 0 1,712 3,152
----- ------ ------
44,675 40,904 76,635
Share of results
in joint venture (107) (140) (276)
Profit on disposal
of discontinued
operations 0 0 17,552
Profit on sale of
fixed assets -
continuing operations 4 339 457
------ ------ ------
Profit on ordinary
activities before
interest 44,572 41,103 94,368
Net interest payable (2,035) (4,898) (10,580)
------ ------ ------
Profit on ordinary
activities before
taxation 42,537 36,205 83,788
Tax on profit on
ordinary activities (13,204) (11,396) (20,833)
------ ------ ------
Profit on ordinary
activities after
taxation 29,333 24,809 62,955
Equity minority interests 24 44 73
------ ------ -----
Earnings available for
ordinary shareholders 29,357 24,853 63,028
Ordinary dividends on
equity shares (6,684) (6,142) (20,217)
------ ------ ------
Retained for reinvestment
in the business 22,673 18,711 42,811
===== ===== =====
Basic earnings per
ordinary share 21.1p 17.9p 45.4p
Diluted earnings per
ordinary share 20.8p 17.7p 45.0p
Dividend per ordinary
share 4.8p 4.4p 14.5p
GROUP BALANCE SHEET
As at As at As at
27 Jun 28 Jun 27 Dec
1999 1998 1998
£'000 £'000 £'000
FIXED ASSETS
Intangible assets 348,553 354,098 348,509
Tangible assets 129,669 117,745 122,706
Own shares 430 455 430
Investments 4,199 4,408 4,433
------ ------ ------
482,851 476,706 476,078
------ ------ ------
CURRENT ASSETS
Stocks 2,544 4,048 3,066
Debtors due within
one year 55,514 55,760 45,717
Debtors due after
one year 10,928 8,622 10,328
Investments 67 114 67
Cash at bank and in hand 6,859 46,759 28,866
------ ------ ------
75,912 115,303 88,044
------ ------ ------
CREDITORS: DUE WITHIN
ONE YEAR
Finance debt (13,504) (38,202) (13,905)
Other creditors (70,092) (65,371) (68,598)
------ ------ ------
(83,596) (103,573) (82,503)
------ ------ ------
NET CURRENT (LIABILITIES)/
ASSETS (7,684) 11,730 5,541
------ ------- ------
TOTAL ASSETS LESS CURRENT
LIABILITIES 475,167 488,436 481,619
CREDITORS: DUE AFTER
ONE YEAR
Finance debt (50,596) (118,531) (80,701)
Deferred purchase consideration (5,555) (6,459) (5,945)
PROVISIONS FOR LIABILITIES
AND CHARGES (12,513) (10,560) (12,223)
ACCRUALS AND DEFERRED INCOME (2,628) (2,766) (2,711)
------ ------ ------
CAPITAL EMPLOYED 403,875 350,120 380,039
===== ===== =====
CAPITAL AND RESERVES
Called up equity
share capital 13,957 13,914 13,918
Share premium account 212,944 211,598 211,745
Revaluation reserve 5,568 5,626 5,568
Profit and loss account 171,406 118,982 148,808
------ ------ ------
EQUITY SHAREHOLDERS' FUNDS 403,875 350,120 380,039
===== ===== =====
Gearing 14.2% 31.4% 17.3%
GROUP CASH FLOW STATEMENT
26 weeks 26 weeks 52 weeks
ended ended ended
27 Jun 28 Jun 27 Dec
1999 1998 1998
Note £'000 £'000 £'000
Cash flow from
operating activities 6 39,240 39,430 90,848
Returns on investments
and servicing of
finance 7 (4,243) (5,006) (11,556)
Taxation (426) (5,632) (18,221)
Capital expenditure and
financial investment 7 (13,799) (7,281) (21,397)
Acquisitions and disposals 7 5 (1,297) 30,426
Equity dividends paid (14,061) (12,787) (18,903)
---------- ---------- ----------
Cash inflow before
use of liquid resources
and financing 6,716 7,427 51,197
Financing:- 7
Issue of shares 1,238 1,218 1,368
Decrease in net debt (29,895) (11,467) (73,286)
---------- ---------- ----------
(28,657) (10,249) (71,918)
---------- ---------- ----------
Decrease in cash
in the period 8 (21,941) (2,822) (20,721)
====== ====== ======
Reconciliation of net cash flow to movement in net debt (note 8)
£'000 £'000 £'000
Decrease in cash
in the period (21,941) (2,822) (20,721)
Cash outflow from decrease
in debt and finance leases 29,895 11,467 73,286
------ ------ ------
Change in net debt
resulting from cash flows 7,954 8,645 52,565
Finance leases acquired
with subsidiary 0 0 (25)
Disposal of subsidiary
undertaking 0 0 297
Disposal of current asset
investment 0 0 (17)
Provision against a current
asset investment 0 0 (30)
Other movements arising in
finance leases 921 (7) (7)
New loan notes issued on
acquisition of subsidiary (310) (991) (991)
Currency translation differences (66) (3) 39
------ ------ ------
Movement in net debt
in the period 8,499 7,644 51,831
Net debt at start of
the period (65,673) (117,504) (117,504)
------ ------ ------
Net debt at end of
the period (57,174) (109,860) (65,673)
===== ====== ======
STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
26 weeks 26 weeks 52 weeks
ended ended ended
27 Jun 28 Jun 27 Dec
1999 1998 1998
£'000 £'000 £'000
Profit for the financial 29,357 24,853 63,028
period
Currency translation differences
on foreign currency net investments (75) 1 41
------ ------ ------
Total recognised gains and
losses relating to the period 29,282 24,854 63,069
===== ===== =====
RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
26 weeks 26 weeks 52 weeks
ended ended ended
27 Jun 28 Jun 27 Dec
1999 1998 1998
£'000 £'000 £'000
Profit for the financial period
attributable to shareholders 29,357 24,853 63,028
Dividends (6,684) (6,142) (20,217)
----- ----- -----
Retained earnings 22,673 18,711 42,811
Other recognised gains and
losses relating to the period (75) 1 41
New share capital subscribed 1,238 2,239 2,390
Effect of share options expensed
by parent company 0 (794) (804)
Goodwill recognised through
the profit and loss account 0 0 5,014
Goodwill adjustment arising
following amendment to
deferred consideration 0 0 624
----- ----- -----
Net increase in shareholders' 23,836 20,157 50,076
funds
Opening shareholders' funds 380,039 329,963 329,963
------ ----- -----
CLOSING SHAREHOLDERS' FUNDS 403,875 350,120 380,039
===== ===== =====
NOTES TO THE ACCOUNTS
1 BASIS OF PREPARATION
The interim financial statements, which are not statutory accounts, have been
prepared on the basis of the accounting policies set out in the Group's 1998
statutory accounts as amended by the adoption of Financial Reporting Standard
12 in the period.
The statements were approved by the Board of Directors on 5 August 1999 and
are unaudited.
The auditors have carried out a review and their report is set out on page 17.
The figures for the 52 weeks ended 27 December 1998 have been extracted from
the statutory accounts which have been filed with the registrar of companies.
The auditors' report on these accounts was unqualified and did not contain any
statement under section 237 (2) or (3) of the Companies Act 1985.
26 weeks 26 weeks 52 weeks
ended ended ended
27 Jun 28 Jun 27 Dec
1999 1998 1998
£'000 £'000 £'000
2 ANALYSIS OF ACTIVITIES
TURNOVER
Continuing operations
Publishing in United
Kingdom and Ireland 167,955 161,756 321,258
Discontinued operations
Publishing in USA 0 12,548 21,174
----- ----- -----
167,955 174,304 342,432
===== ===== ====
OPERATING PROFIT
Continuing operations
Publishing in United Kingdom
and Ireland 44,675 39,192 73,483
Discontinued operations
Publishing in USA 0 1,712 3,152
----- ----- -----
44,675 40,904 76,635
===== ===== ====
3 TAXATION
Taxation has been calculated using an estimated annual effective tax rate of
31.0% (1998: 26 weeks, 31.5%; 52 weeks, 24.9%) on profit on ordinary
activities before taxation.
4 ORDINARY DIVIDENDS
The interim dividend of 4.8 pence per share will be paid on 29 October 1999 to
shareholders on the register on 13 August 1999. This compares with an interim
dividend of 4.4 pence and a total dividend of 14.5 pence paid in respect of
1998.
5 EARNINGS PER SHARE
The calculation of basic earnings per ordinary share is based on earnings of
£29.357m (1998: £24.853m) after taxation and equity minority interests and the
weighted average number of ordinary shares ranking for dividend of 139,422,980
(1998: 138,946,316). The calculation of diluted earnings per ordinary share
is based on the same earnings of £29.357m (1998: £24.853m) after taxation and
equity minority interests and the increase in the weighted average number of
ordinary shares ranking for dividend of 140,930,605 (1998: 140,233,142) arises
only from the existence of share options.
6 NET CASH INFLOW FROM OPERATING ACTIVITIES
26 weeks 26 weeks 52 weeks
ended ended ended
27 Jun 28 Jun 27 Dec
1999 1998 1998
£'000 £'000 £'000
Operating profit 44,675 40,904 76,635
Depreciation charges 7,032 6,610 13,484
Other non-cash items (270) (2) (75)
Working capital (12,197) (8,082) 804
------ ----- -----
Net cash inflow from operating
activities 39,240 39,430 90,848
===== ===== ====
Changes in working capital are stated after excluding movements due to
acquisitions, disposals and exchange.
7 ANALYSIS OF CASH FLOWS FOR HEADINGS NETTED IN THE CASH FLOW STATEMENT
26 weeks 26 weeks 52 weeks
ended ended ended
27 Jun 28 Jun 27 Dec
1999 1998 1998
£'000 £'000 £'000
Returns on investments
and servicing of finance
Interest received 502 914 2,397
Interest paid (656) (2,249) (10,264)
Interest element of finance
lease rental payments (4,089) (3,671) (3,689)
Net cash outflow for returns ----- ----- -----
on investments and servicing
of finance (4,243) (5,006) (11,556)
===== ===== ====
Capital expenditure and
financial investment
Purchase of intangible
fixed assets (82) (123) (142)
Purchase of tangible
fixed assets (13,810) (7,473) (21,803)
Purchase of investments (103) (43) (223)
Sale of tangible fixed assets 61 358 581
Grant funding received 0 0 56
Sale of investments 135 0 134
Net cash outflow for ----- ----- -----
capital expenditure and
financial investment (13,799) (7,281) (21,397)
===== ===== =====
Acquisitions and disposals
Purchase of subsidiary
undertakings 0 (1,100) (2,711)
Cash at bank and in hand/
(bank overdraft) acquired 163 0 (67)
Sale of subsidiary
undertaking 0 0 33,532
Additional funding of
joint venture (158) (197) (328)
Net cash inflow/(outflow) ----- ----- -----
for acquisitions and disposals 5 (1,297) 30,426
===== ===== =====
Financing
Issue of ordinary
share capital 1,238 1,218 1,368
------ ------ -----
Debt due within one year:
Repayment of unsecured
loans (28,000) (10,175) (71,908)
Repayment of loan notes (470) (39) (101)
Debt due beyond a year:
Capital element of finance
lease rental payments (1,425) (1,253) (1,277)
------ ------ -----
(29,895) (11,467) (73,286)
------ ------ ------
Net cash outflow from
financing (28,657) (10,249) (71,918)
===== ===== =====
8 ANALYSIS OF NET DEBT
At 27 Dec Cash Other Exchange At 27 Jun
1998 Flow non-cash movement 1999
changes
£'000 £'000 £'000 £'000 £'000
Cash at bank
and in hand 28,866 (21,941) 0 (66) 6,859
Debt due after
one year (32,000) 28,000 0 0 (4,000)
Debt due within
one year (3,000) 0 0 0 (3,000)
Loan notes (6,451) 470 (310) 0 (6,291)
Finance leases (53,155) 1,425 921 0 (50,809)
------
29,895
------
Current asset 67 0 0 0 67
investments
------ ------ ------ ----- ------
Total (65,673) 7,954 611 (66) (57,174)
===== ===== ===== ===== =====
9 SALE OF BUSINESS
The cash inflow for the 1998 full year of £33.532m relates to the proceeds
received, less associated expenses, from the disposal of the USA division
during 1998.
10 PURCHASE OF SUBSIDIARY UNDERTAKINGS
26 weeks 26 weeks 52 weeks
ended ended ended
27 Jun 28 Jun 27 Dec
1999 1998 1998
£'000 £'000 £'000
Net assets acquired:
Tangible fixed assets 109 0 170
Debtors 114 0 614
Cash at bank and in hand 163 0 0
Bank overdraft 0 0 (67)
Creditors (51) 0 (484)
Taxation 0 0 (95)
Loans and finance leases 0 0 (25)
---- ---- ----
335 0 113
Goodwill arising on the
acquisition in the year 0 0 1,498
---- ---- ----
335 0 1,611
==== ==== ====
Satisfied by:
Cash 0 0 1,611
Intercompany debt 335 0 0
---- ---- ----
335 0 1,611
==== ==== ====
Analysis of the net (inflow)/
outflow of cash in respect
of acquisitions
Cash consideration 0 0 1,611
Deferred consideration paid 0 1,100 1,100
---- ---- ----
0 1,100 2,711
(Cash at bank)/bank
overdraft acquired (163) 0 67
---- ---- ---
Net (inflow)/outflow of cash
in respect of the purchase
of businesses (163) 1,100 2,778
==== ==== ====
On 8 June 1999 the group acquired the remaining 50% of its joint venture
interest in Channel One Liverpool Limited. The fair value of the net assets
acquired of £0.335m was settled by intercompany debt.
On 6 November 1998 the group acquired Mediaserve Limited for a cash
consideration of £1.611m. In addition during 1998 the Group paid a further
£1.1m of cash as part of the £4.0m deferred consideration payable on the
acquisition of the Computer Trade Only title which was acquired on 3 October
1997.
11 DISTRIBUTION
This statement is being sent to all holders of the Company's ordinary shares.
Copies will be available to members of the public at the Company's registered
office; Kingsfield Court, Chester Business Park, Chester CH4 9RE.
INDEPENDENT REVIEW REPORT TO TRINITY PLC
Introduction
We have been instructed by the company to review the financial information set
out on pages 8 to 16 and we have read the other information contained in the
interim report and considered whether it contains any apparent misstatements
or material inconsistencies with the financial information.
Directors' responsibilities
The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by the directors. The Listing
Rules of the London Stock Exchange require that the accounting policies and
presentation applied to the interim figures should be consistent with those
applied in preparing the preceding annual accounts except where any changes,
and the reasons for them, are disclosed.
Review work performed
We conducted our review in accordance with the guidance contained in Bulletin
1999/4 issued by the Auditing Practices Board. A review consists principally
of making enquiries of group management and applying analytical procedures to
the financial information and underlying financial data and based thereon,
assessing whether the accounting policies and presentation have been
consistently applied unless otherwise disclosed. A review excludes audit
procedures such as tests of controls and verification of assets, liabilities
and transactions. It is substantially less in scope than an audit performed
in accordance with Auditing Standards and therefore provides a lower level of
assurance than an audit. Accordingly, we do not express an audit opinion on
the financial information.
Review conclusion
On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the 26 weeks
period ended 27 June 1999.
Deloitte & Touche
Chartered Accountants
201 Deansgate
Manchester
M60 2AT
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