Final Results
To be released at 7.00 a.m.
on 2 April 2007
ToLuna Plc
(the "Group" or the "Company")
Results for the year ended 31st December 2006
Highlights
* A year of dramatic growth
* Revenues ahead 180 per cent. to £8.4 million (2005: proforma £3 million)
* Pretax profits ahead 220 per cent. to £2.2 million (2005: proforma £0.7
million)
* Pretax profits before share based payment charges ahead 210 per cent. to £
2.3 million
* Revenues, profits and earnings ahead of expectations
* First year of dividend payments - final dividend proposed of 0.5 pence per
share, making 0.75p for the year
* EPS before deferred tax of 4.80 pence per share
* Panel members up from 729,000 to 1.3 million at year end, now 1.4 million
* Expansion across Europe, foothold in the US
Further enquires:
ToLuna plc
Frederic-Charles Petit, Chief Executive Tel: 00336 33 08 03 91
Richard Bernstein, Non-Executive Director Tel: 0207 491 0770
Powerscourt
Victoria Palmer-Moore Tel: 0207 236 5680
Notes to Editors
ToLuna is the leading independent provider of online panel and technology to
the market research industry. It operates and builds online panels across
Europe. It has designed and operates application service to enable research to
be undertaken online.
ToLuna offers data collection services to the market research industry
covering:
* access to its online panellists;
* creation of dedicated online panels; and
* licensing of its own hosted proprietary survey and panel management
technology.
The Group operates internationally with offices in London, Paris, Frankfurt and
New York.
Chairman's Statement
I am pleased to report to you on an important and exceptional year for ToLuna.
We have made significant progress with our strategy of becoming the leading
European independent provider of panel and technology services to the market
research industry. We have further developed our presence in the UK, France and
Germany with strong operational and sales offices giving our clients pan
European as well as local online data collection services. Our first
acquisition, Speedfacts, acquired in December 2005, has been successfully
integrated into the Group and strengthened our footprint in Europe. The opening
of our New York office in September further extended our geographical reach. It
now has eightstaff. Our panel coverage has dramatically increased, measured by
the number of panel members, from 729,000 at the start of the year to 1,300,000
at 31 December 2006. It currently stands at 1,400,000.
Results
Our financial performance strengthened throughout the year both in terms of
revenues and profit. In comparison to the proforma full year figures for the
year ended 31 December 2005, our revenues have almost trebled to £8.4 million
(2005: £3 million). Profit before tax has risen to £2.2 million from £0.7
million and to £2.3 million (2005: £0.8 million) before recording a share-based
payment charge. Profit after tax has also almost trebled to £1.4 million (2005:
£0.5 million), at an improved margin of 25.4 per cent. (2005:19.6 per cent.).
The basic earnings per share for the year is 4.03 pence (2005: 0.99 pence).
However, based on the current tax charge, excluding deferred tax, the basic
earnings per share is 4.80 pence (2005: 1.82 pence). Basic earnings per share,
excluding deferred tax and the share-based payment charge, is 5.09 pence (2005:
1.99 pence).
The business is highly cash generative with cash generated from operations
during 2006 of £1.9 million (period to 2005: £0.5 million). Our cash reserves
at the end of the year were £3.6 million.
ToLuna has grown rapidly during the year and the commitment of our people to
the best possible client services is reflected in our level of repeat business
and our business performance. The number of clients has more than doubled to
246. Repeat business from our existing clients represents 70 per cent. of
revenue.
Dividend
Your Board is recommending the payment of a final dividend of 0.5 pence per
share payable on 29 June 2007 to shareholders on the register of members at
close of business on 1 June 2007. This brings the total dividend payable in
respect of the year to 0.75 pence (2005: nil).
Operational review
ToLuna's service to the market research industry is the supply of data
collection services. This covers the access to our panellists, the creation and
management of bespoke panels and the provision of hosted survey and panel
management technology.
In 2006, growth has been seen in our revenues in Europe, the US and Asia
Pacific. This validates our strategy of having a strong presence in each of the
main European markets. Our European revenue has increased to £5.9 million
(2005: proforma £2.3 million), and our US revenue has increased significantly
to £2.3 million (2005: proforma £0.6 million) and our Asia Pacific income has
increased to £0.2 million (2005: proforma £0.1 million).
Technology
During the year, we have won a number of blue chip clients on our
AutomateSurvey and PanelPortal solution. I am also pleased to report that we
are now using the first modules of the new version of this application
service..
Panel Access and Panel Building
Our ToLuna and Testandvote online communities are at the core of our
development. We now have 1.4 million online panellists. We operate panels in 20
countries and have 16 specialist panels covering specialist areas such as the
automotive and healthcare sectors and the B2B (business to business) community.
Outside Europe, we have begun to replicate our model of multi-national,
multicultural panels, by opening panels in territories such as Australia,
Mexico and Brazil.
We are committed to building a strong and long term relationship with the
individuals who answer our surveys. In line with that objective, our consumer
opinion community is now operating in France, Belgium, Switzerland, United
Kingdom, Ireland, Austria, Netherlands, Italy, Spain, Germany and Portugal.
As a result, we are now able to deliver a more interactive experience to our
panel communities and our engagement with the members of our panels gives us
confidence in building a superior long term sustainable platform for panel
management and panellist relationships.
Overseas Expansion and Acquisition
ToLuna is seeking new ways to grow business internationally and we are
currently assessing a number of market opportunities.
On 1 March 2007 we acquired dPolls.com, which operates an online community
website. Although this is not a substantial acquisition in terms of cost, we
are confident that it will not only add to revenues but will also add
significant value to the community aspects of our panel operations. We have, in
line with that strategy, launched a web and community research lab, consisting
of a first class technology team based in Haifa, Israel which will be in charge
of developing ToLuna strategy in this space.
Charitable Donations
In April, the Company intends to issue a total of 25,000 new ordinary shares of
1p each, divided equally between five charitable organisations. We hope that
the creation and gifting of new shares to worthy causes will encourage other
companies to support charities in this way.
Management and Staff
This is a people business. We continue to create a first class team of online
experts. On behalf of the Board I would like to thank all the members of the
ToLuna Group for their continuing high level of motivation and commitment
during this exciting period of growth for the Group.
Prospects and Outlook
The global market research market is equal to around US$23 billion. Inside
Research currently estimates that from 2005 to 2006, online research has grown
in Europe from US$205 million to US$277 million and in the US online research
was US$1,435 billion in 2006 up 19 per cent. on 2005. In our core market,
Europe, the growth has been 34 per cent and we expect these trends to continue
as we see online market research accelerating.
Our strategy is to continue our expansion through organic growth, continued
development of our panels and communities both geographically and in-depth
services, extending our product offering both in panels, communities,
technologies and a combination of selective acquisitions.
I am pleased to report that the new financial year has begun well with the
Group achieving strong revenue and profit growth. Demand for our products and
services is increasing and your Board believes that we are well positioned to
capitalise on the strong fundamentals in our markets as the switch to online
market research gathers pace. I look forward to the current year with
confidence.
George Kynoch
Chairman
30 March 2007
Unaudited Proforma Consolidated Income Statement
The additional proforma information does not form part of the financial
statements on which the auditor has issued the report; however, it should be
read in conjunction with them.
The Company acquired Cjudge SAS on 10 May 2005 and therefore the comparative
consolidated income statement in the financial statements only includes the
results from that date. The following comparative proforma information shows
the results of the Group for the full year ended 31 December 2005 as if the
Group had been in existence for the full year.
Year ended 31 Proforma year
December ended
2006 31December
£'000 2005
£'000
Revenue 8,392 3,001
Staff costs (3,295) (1,267)
Other operating expenses (2,963) (1,147)
Profit from operations 2,134 587
Net investment income 104 113
Profit before tax 2,238 700
Tax (790) (233)
Profit for the financial year 1,448 467
Earnings per share
Basic 4.03p 1.30p
Diluted 3.96p 1.29p
Basic - excluding deferred tax 4.80p 1.82p
Notes:
The comparative earnings per share have been calculated on the assumption that
the shares at the time of the acquisition of Cjudge Ltd and at the time of
listing on AIM were in issue for the full year.
The retained profit for the financial year using the current tax charge
(excluding deferred tax) of £516,000 (2005: £45,000) would be £1,722,000 (2005:
£655,000).
Consolidated Income Statement
Note Year ended Period from
31December 16 March 2005
to
2006
31December
£'000
2005
£'000
Revenue 2 8,392 2,155
Staff costs (3,295) (1,001)
Other operating expenses (2,963) (839)
Profit from operations 2,134 315
Net interest income 104 115
Profit before tax 2,238 430
Tax 3 (790) (147)
Profit for the financial year/period 1,448 283
Earnings per share
Basic 5 4.03p 0.99p
Diluted 5 3.96p 0.98p
Consolidated Balance Sheet
31 December Restated
2006 31 December
£'000 2005
£'000
Non-current assets
Goodwill 1,953 1,953
Other intangible assets 1,153 602
Property, plant and equipment 202 70
Deferred tax 21 295
3,329 2,920
Current assets
Trade and other receivables 3,019 1,323
Cash and cash equivalents 3,605 2,968
6,624 4,291
Total assets 9,953 7,211
Equity and liabilities
Equity
Share capital 359 359
Share premium account 5,365 5,365
Retained earnings 1,803 339
Translation reserve (42) -
Total equity 7,485 6,063
Current liabilities
Trade and other payables 1,933 1,057
Tax liabilities 535 91
Total current liabilities 2,468 1,148
Total equity and liabilities 9,953 7,211
Consolidated Cash Flow Statement
Year ended Period from 16
March 2005 to
31December
31December
2006
2005
£'000 £'000
Operating activities
Profit before tax 2,238 430
Adjustments for:
Depreciation and amortisation 508 123
Share option grant costs 106 56
Loss on disposal of property, plant and 4 1
equipment
Exchange (42) -
2,814 610
Tax paid (73) -
Increase in receivables (1,696) (563)
Increase in payables 860 481
Cash generated from operations 1,905 528
Net investment income (104) (115)
Net cash from operating activities 1,801 413
Investing activities
Interest received 106 127
Interest paid (2) (12)
Purchase of subsidiary undertakings (net of - (1,540)
cash acquired)
Purchase of intangible assets (1,010) (446)
Purchase of property, plant and equipment (206) (37)
Net cash from investing activities (1,112) (1,908)
Cash inflow/(outflow) before financing 689 (1,495)
Financing
Dividend paid (90) -
Issue of shares - 4,443
Proceeds from finance leases entered into 70 20
Capital repayments of finance leases (32) -
Net cash (outflow)/inflow from financing (52) 4,463
Increase in cash and cash equivalents in the 637 2,968
year
Cash and cash equivalents at start of the 2,968 -
period
Cash and cash equivalents at end of the year 3,605 2,968
Statements of Changes in Equity
Group Share Share Retained Translation Total
Capital Premium earnings reserve
account £'000
£'000 £'000 £'000
£'000
At 16 March 2005 - - - -
Shares issued in the 359 5,922 - 6,281
period
Costs in relation to - (557) - (557)
issue of shares
Share option grants - - 56 56
Retained profit for the - - 283 283
period
At 1 January 2006 359 5,365 339 - 6,063
Dividend paid - - (90) - (90)
Exchange differences - - - (42) (42)
Share option grants - - 106 - 106
Retained profit for the - - 1,448 - 1,448
year
At 31 December 2006 359 5,365 1,803 (42) 7,485
The Group's total recognised income and expense for the year ended 31 December
2006 was £1,406,000 (2005: £283,000)
Notes to the Financial Statements
1. Publication of non-statutory accounts
The financial information set out in this preliminary announcement does not
constitute statutory accounts as defined in Section 240 of the Companies Act
1985.
The financial information for the period ended 31 December 2006 has been
extracted from the Company's financial statements to that date which have
received an unqualified auditors' report but have not yet been delivered to the
Registrar of Companies.
2. Segmental information
All revenue relates to the supply of online data collection services to the
market research industry. The directors regard this as a single class of
business.
All revenue is originated from Europe. Geographical split of revenue by
customer location is as follows:
Year to 31 December Europe Asia/ America Total
Pacific
2006 £'000 £'000 £'000
£'000
Revenue from external 5,871 188 2,333 8,392
customers
Assets 9,870 - 62 9,932
Liabilities 2,393 - 75 2,468
Property plant and 192 - 10 202
equipment
Amortisation and 529 - - 529
depreciation
Period from 16 March 2005 Europe Asia/ America Total
to 31 December 2005 Pacific
£'000 £'000 £'000
£'000
Revenue from external 1,542 76 537 2,155
customers
Assets 7,202 - - 7,202
Liabilities 1,140 - - 1,140
Property plant and 70 - - 70
equipment
Amortisation and 123 - - 123
depreciation
3. Tax
Year ended Period from
31 December 16 March 2005
to 31
2006 December 2005
£'000 £'000
Current tax
UK tax 417 46
Foreign tax 99 -
Deferred tax 516 46
274 101
Tax expense 790 147
Deferred tax relates to the utilisation of the deferred tax asset recognised on
the acquisition of the Cjudge SAS in respect of accumulated tax losses and
other timing differences arising in the period.
Tax reconciliation Year ended Period from
31 December 16 March 2005
to
2006
31 December
2005
£'000 £'000
Profit before tax 2,238 430
Tax at 30 per cent on profit before tax 671 129
Effects of:
Non deductible items 41 18
Foreign tax rates 11 -
Unutilised losses in foreign 21 -
subsidiaries
46 -
Other timing differences
Tax expense 790 147
4 Dividends
The Company paid a dividend of 0.25 pence per share on 22 October 2006
amounting to £90,000 (2005: £Nil)
5 Earnings per share
Earnings per share has been calculated on a profit after tax of £1,448,000
(2005: £283,000) and the weighted average number of shares in issue for the
period of 35,915,245 (2005: 28,616,031).
The diluted earnings per share is calculated on the assumption that all options
granted were exercised. This would give rise to a total weighted average number
of ordinary shares in issue for the period of 36,590,436 (2005: 28,937,823).
6.
Copies of the Report and Accounts will be sent to shareholders shortly and will
be available from the registered office of the Company, 29 Curzon Street,
London W1J 7TL.
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