Sale of Totally Communications & Trading Update

RNS Number : 9198V

Totally PLC

19 December 2013

 



19 December 2013

Totally Plc

("Totally" or the "Company")

Divestment of Totally Communications Limited, Trading Update and Proposed Change of Name

Divestment of Totally Communications Limited

The Board of Totally (AIM : TLY), the AIM quoted provider of innovative digital healthcare solutions, is pleased to announce that on 18 December 2013 the Company completed the sale of its 100 per cent. equity interest in Totally Communications Limited ("Totally Communications"), the Company's digital marketing business, to Crisp Works Limited ("the Purchaser" or "CWL") (the "Disposal").

The total consideration is £300,000 payable in cash and this is being paid in two instalments; £275,000 was paid on 18 December 2013 and £25,000 is to be paid on the anniversary of the first payment. £100,000 of  the sale proceeds will be used by the Company to provide further working capital and for general corporate purposes and £200,000 will be used for full and final settlement of outstanding intercompany loans with Totally Communications.

The unaudited gross assets of Totally Communications as at 30 June 2013 were £223,000 (excluding inter-company debtors), the audited revenue of Totally Communications for the year ended 31 December 2012 was £850,000 and the audited profit before taxation and extraordinary items was £32,000.

Following the Disposal, the Company will continue to focus on growing Totally Health Limited ("Totally Health"), its wholly owned subsidiary which promotes specialist innovative solutions across the spectrum of healthcare. This includes clinical health coaching services to promote self care and bring about behavioural changes which impact positively on the health of people diagnosed with a Long Term Condition. The Disposal reflects Totally's growth strategy which is driven by the Totally Health division and will enable the Company to focus its resources on implementing its strategy for Totally Health and creating value for shareholders. Totally Plc and Totally Health will retain relevant health related IT technical expertise following the Disposal.

The Purchaser is a newly incorporated company set up for the purpose of acquiring Totally Communications and its share capital is held in equal proportions by the three existing directors of Totally Communications on completion.  Andy Margolis, Executive Director of Totally, is a director of Totally Communications and has a 33.33% equity interest in CWL on completion. As Andy Margolis is a director of the Company he is treated as a related party under the AIM Rules for Companies. The Disposal therefore constitutes a related party transaction for the purposes of AIM Rule 13.

The directors of the Company (other than Andy Margolis who is not deemed to be independent for the purposes of the Disposal) consider that, having consulted with the Company's nominated adviser, Allenby Capital Limited, the terms of the Disposal are fair and reasonable insofar as the Company's shareholders are concerned.

Trading Update

Following the recent fundraise in Autumn 2013, Totally Plc's Board has driven the implementation of its business strategy within Long Term Condition management. The Board is concentrating resources to ensure a continued focus on its business strategy in the healthcare sector. The Board believes these changes are essential to maintain the current clear focus going into 2014.

The following changes have been implemented:

- Reduced Board level remuneration by up to 50% with all Directors agreeing to decreases in salary and writing off outstanding salaries due from the Company. This has reduced monthly cash burn and afforded more working capital.

- Rationalised business models and staffing, including redundancy measures to ensure that business growth, delivery to clients and effective use of resources continue to be the number one priority.

- Beginning work with another new client before Christmas to support patients  living with Chronic Obstructive Pulmonary Disease (COPD) through the winter months. Darley Dale Medical Centre in Derbyshire has requested that work begins as soon as possible in order to support patients through the Christmas and New Year period.

Totally continues to work closely with all existing clients which include:

- NHS England and services on Shared Decision Making. Totally Health host and maintain the interactive website for 36 existing Patient Decision Aids (PDAs) along with the 36 mobile apps for the PDAs.

- NHS Leicester City CCG - Total Care Programme providing Clinical Health Coaching services to 150 chronically ill patients with COPD plus 250 newly diagnosed patients with COPD. This programme has been running for approximately 12 months during which time the CCG has evaluated the programme and highlighted savings in excess of £550,000 which exceeds all original expectations. During the period that the service has been running there has been a dramatic decrease in the number of Accident & Emergency attendances by people enrolled into our programme.

- Recent new clients in Southern Derbyshire and High Weald Lewes Haven CCG are progressing well with early results proving to be in line with our expectations and those already realised from other clients.

- The addition of key individuals to an excellent team of experts whose time is focused on working with potential clients across healthcare both in the NHS and in the private sector. The team is continually pushing forward with the new business opportunities that present themselves. It is expected the strong pipeline will continue to gain traction with more positive newsflow in the first quarter of 2014.

The Board will be engaging more with shareholders and key stakeholders in 2014 to ensure regular updates on business activity and services provided by the Group.

The Board would like to thank its shareholders for their continued support. The directors of Totally believe that the support and hard work in repositioning the Company and laying firm foundations for growth will crystallise into increased traction and new contract wins in 2014.

Proposed Change of Name

Following completion of the Disposal the Company intends to change its name to Totally Health Plc to reflect the Company's ongoing activities and focus. The change of name will be subject to approval by shareholders in a general meeting to be held in due course and a further announcement will be made at the appropriate time.

Wendy Lawrence, Chief Executive of Totally, commented,:

"We are pleased to announce the sale of our digital marketing business which will enable the management team of Totally to focus on its growing, core business in Totally Health which provides innovative digital solutions to their clients across the healthcare sector. The Disposal allows Totally to concentrate its resources in the growing healthcare market while retaining its IT technical competency in delivering health focused solutions.  We remain strongly of the view that Totally Health is well positioned to capitalise on the demand for its current core proposition of long term management services through Shared Decision Making and health coaching provision."

Totally Plc	Tel: [phone]
Wendy Lawrence, Chief Executive
Allenby Capital Limited (Nominated Adviser & Joint Broker)	Tel: [phone]
Mark Connelly / Nick Athanas
Optiva Securities Limited (Joint Broker)	Tel: [phone]
Christian Dennis / Jeremy King

 

END

 

 

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