| Wed 30 Jun 2010, 11:53 | | MNY - Moneyweb Holdings - Reviewed condensed financial results for the year |
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MNY
MNY
MNY - Moneyweb Holdings - Reviewed condensed financial results for the year
ended 31 March 2010 and further cautionary announcement
Moneyweb Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration No: 1998/025067/06)
JSE code: MNY ISIN: ZAE000025409
("Moneyweb" or "the company" or "the group")
REVIEWED CONDENSED FINANCIAL RESULTS FOR THE YEAR ENDED 31 MARCH 2010 AND
FURTHER CAUTIONARY ANNOUNCEMENT
* Core online community up 12% year-on-year, total visitors up to 230 000
* Revenues up 29% and net profit up 28%
* Earnings per share up by 29%
* Headline earnings per share of 2.16 cents vs (0.19) in prior year
* Expected strong continuing organic growth for the year ahead
Condensed Group Statement of
Comprehensive Income
Reviewed Audited
12 months 12 months
31-Mar-10 31-Mar-09
R`000 R`000
Revenue 27 159 20 979
Advertising 26 159 19 897
Newsletters 1 000 1 082
Profit/(loss) before investment income, 3 941 (199)
fair value adjustment, depreciation,
amortisation and impairments
Depreciation and amortisation (962) (856)
Investment income 358 598
Finance cost (34) (27)
Fair value adjustment of 7 (11)
investment and financial
instruments
Impairment of financial assets (1 118 ) -
Profit on disposal of intangible - 1 860
asset
Loss on disposal of tangible asset (9) -
Net profit before taxation 2 183 1 365
Taxation (732) (741)
Profit from joint ventures 175 644
Net profit for the period 1 626 1 268
Other comprehensive income
Exchange differences on (516) (363)
translating foreign operations
Total comprehensive income for the 1 110 905
year
Reconciliation of headline
earnings
Net profit for the period 1 626 1 268
Profit on disposal of intangible - (1 414)
asset
Loss on disposal of tangible asset 9 -
Headline earnings/(loss) 1 635 (146)
Earnings per share (cents) 2.15 1.67
Headline earnings/(loss) per share 2.16 (0.19)
(cents)
Number of shares (000`s)
- Issued closing (net of 75 775 75 808
treasury)
- weighted average 75 777 76 037
Condensed Group Statement of
Financial Position
Reviewed Audited
31-Mar-10 31-Mar-09
ASSETS R`000 R`000
Non-current assets
Tangible assets 2 681 778
Intangible assets 3 622 2 776
Investment in joint ventures 1 108 863
Other investment 14 7
Deferred taxation 147 457
7 572 4 881
Current assets
Trade and other receivables 8 820 8 098
Cash and cash equivalents 5 935 8 030
14 755 16 128
Total assets 22 327 21 009
EQUITY AND LIABILITIES
Capital and reserves
Share capital and premium 11 788 11 805
Accumulated profit 3 194 2 842
Ordinary shareholders` interest 14 982 14 647
Non-current liabilities
Current liabilities
Trade and other payables 2 520 2 598
Deferred revenue 3 873 3 190
Income tax payable 952 574
7 345 6 362
Total equity and liabilities 22 327 21 009
Net asset value per share (cents) 19.8 19.3
Net tangible asset value per share 16.2 18.3
(cents)
Condensed Group Statement of Changes in
Equity
Sha Share Transla Accumula Total
re premiu tion of ted
cap m foreign profit
ita operati
l ons
R`0 R`000 R`000 R`000 R`000
00
Balance at 1 April 2008 76 11 856 - 2 699 14 631
Total comprehensive income for the - - (363) 1 268 905
year ended 31 March 2009
Ordinary dividend paid - - - (762) (762)
Treasury shares purchased (127) (127)
-
Balance at 1 April 2009 76 11 729 (363) 3 205 14 647
Total comprehensive income for the - - (516) 1 626 1 110
year ended 31 March 2010
Ordinary dividend paid - - - (758) (758)
Treasury shares purchased - (17) - - (17)
Balance at 31 March 2010 76 11 712 (879) 4 073 14 982
Condensed Group Statement of Cash
Flow
Reviewed Audited
12 months 12 months
31-Mar-10 31-Mar-09
R`000 R`000
Cash flows from operating
activities
Cash generated by operations 3 156 2 970
Movements in working capital (800) (1 160)
Cash (utilized)/generated by 2 356 1 810
operating activities
Investment income 364 587
Finance cost (34) (27)
Taxation paid (353) (633)
Dividend paid (758) (762)
Net cash flows from operating 1 575 975
activities
Cash flows from investing
activities
Acquisition of intangible assets (1 799) (1 013)
Acquisition of tangible assets (1 944) (217)
Investment in joint ventures - (824)
Proceeds on disposal of - 1 860
intangible assets
Proceeds on disposal of tangible - 4
assets
Repayment of loan receivable 90 -
Net cash flows from investing (3 653) (190)
activities
Cash flows from financing
activities
Acquisition of treasury shares (17) (127)
Net cash flows from financing (17) (127)
activities
Net movement in cash and cash (2 095) 658
equivalents for the period
Cash and cash equivalents at 8 030 7 372
beginning
Cash and cash equivalents at end 5 935 8 030
of period
Financial results
We have seen strong organic growth in both revenue and net profit for the year
to end March 2010, up by 29% and 28% respectively, with revenues at their
highest level in our corporate history.
A net profit of R1,63m (2,15c per share) was achieved for the year despite the
Board having decided to impair the carrying value of certain of the group`s
mini sites by R1,12m, which had the effect of reducing net profit by R0.81m.
Advertising revenues have shown good growth for the year across all our core
platforms, with our flagship websites, www.moneyweb.co.za and www.mineweb.com,
and three nationally broadcast business radio programmes continuing to show
steady increases in our audience numbers. Our strategic relationship with
Google`s Adsense continue to show good growth, with annual receipts up by 60%
in Rand terms. Pleasingly, the work done to reposition Mineweb is bearing fruit
and it has made a positive contribution to earnings, having now solidly swung to
profitability after years of loss making.
While the company`s operating cash flow increased from R2,97m to R3,16m, there
was a net reduction in our year end cash holdings of R2,1m due to significant
investments in both tangible and intangible infrastructure. This provides us
with a strong platform to pursue ongoing growth in our broadcast and web
offerings, as well as allowing us to develop our Financial Aggregator service
to Moneyweb community members. The balance sheet remains strong with year end
cash holdings of R5,9m (2009: R8,0m) and zero debt.
Operating results
Despite the strong positions of market leadership our Internet, broadcast and
newspaper platforms have built up over the past decade, we still continue to see
ongoing growth among our core audience, allowing us to reach new highs.
Google Analytics recorded a core audience of 230 334 unique home page visitors
to the network of Moneyweb sites in March 2010, a 10% increase year-on-year.
Our email newsletter base has risen to over 88 000 unique members.
Our partnership with SABC Radio -- on SAFM, RSG and Lotus FM - is working well
and we continue to serve strong, loyal audiences on each channel. With over 683
000 daily listeners, we remain the strong market leader in radio business
programming. Although our March 2010 audience numbers show an approximate 12%
year-on-year decline, almost all our competitors have seen the same numerical
fall off. We believe this is a consequence of the sampling methods used. Our
relocation to Melrose Arch and the significant upgrades and improvements we have
made to our broadcast capabilities have allowed us to strengthen our programming
capabilities both on radio and multimedia online.
We launched our financial aggregator, moneywebmarketplace.co.za, in beta release
during October 2009 and allowed consumers the opportunity to gain real time
quotes for car and household insurance on a price comparison basis from nine
insurance vendors. We gained much insight and are now working towards a new
release both in terms of technology capability and customer support. Both these
elements are now being further enhanced and we expect these improvements to be
embedded in the next release later in 2010.
We have been pleased with the results from the re-design work done on our
websites. These elements have improved both the user experience and our
capacity to generate further advertising revenues.
Prospects
We enter the new year confident that the forward momentum we built up on our
core platforms will continue. Although the general state of the economic
recovery remains soft, we believe that our platforms will continue to prove
valuable to our audiences and advertisers. Moreover, as broadband penetration
rates continue to widen in South Africa, we believe our audience size will both
increase and deepen across our network thereby directly leveraging our business
model. Our strategic partnership with Google is important here.
We expect a strong contribution from Mineweb in the year ahead and have built a
very capable editorial and sales team that serves key mining centres around the
world. Over 85% of Mineweb`s advertising revenues are now generated outside of
South Africa.
Our mini-sites strategy is making good progress and we expect these trends to
continue. Moneywebtax, Marketingweb and Racingweb all now make modest profits,
whilst Realestateweb and Politicsweb - which have both seen rapid growths in
their unique visitors - continue to be in the build phases of their development.
Notwithstanding, the board has taken the prudent decision to impair the carrying
value of certain financial assets relating to Realestateweb and Politicsweb.
Sportingweb was closed down because it failed to meet our internal investment
criteria.
We have also gently launched Moneyweb.com into the market place, focused
principally on the foreign investor market with its emerging market focus. Its
launch is at a very embryonic stage and we monitor it closely.
We continue to work on our transaction-based sources of revenue on both our
financial aggregator and white label horseracing tote on Racingweb, both of
which have generated revenues for us but need to be transitioned to allow them
to scale.
Post balance sheet events
There are no other material events subsequent to the year end that have not been
reflected in the reviewed financial results for the year ended 31 March 2010 or
that require further disclosure.
Basis of preparation
Statement of compliance
The reviewed condensed financial statements for the year ended 31 March 2010
have been prepared in accordance with the framework concepts and the
recognition and measurement requirements of International Financial Reporting
Standards ("IFRS") and the AC500 Standards, and in compliance with IAS34:
Interim Financial Reporting, the requirements of the Companies Act of South
Africa and the Listing Requirements of the JSE Limited
The principal accounting policies used in the preparation of the results for the
year ended 31 March 2010 are consistent with those applied for the year ended 31
March 2009 and are in terms of IFRS, except for the adoption of IAS1:
Presentation of Financial Statements (Revised) which has had no impact on the
results but affects presentation. International Financial Reporting Standard
8 : Operating Segments is not applicable as the group is a single segment
business.
Basis of measurement
The reviewed condensed financial statements for the year ended 31 March 2010
have been prepared on the historical cost basis with the exception of certain
financial instruments that are stated at fair value.
Going concern
The reviewed condensed financial statements for the year ended 31 March 2010
have been prepared on the going-concern basis since the directors have every
reason to believe that the company has adequate resources in place to continue
in operation for the foreseeable future.
Review opinion
The Group`s auditors, BDO South Africa Inc, have reviewed the condensed
financial results for the year ended 31 March 2010 contained in this report.
Their unmodified review report is available for inspection at the company`s
registered office.
Further cautionary announcement
Shareholders are referred to the cautionary announcement, dated 11 May 2010 and
23 June 2010, and are advised that the company is still in negotiations which,
if successfully concluded, could affect the price of the company`s securities.
Accordingly, shareholders are advised to continue to exercise caution when
dealing in the company`s securities until a further announcement is made.
Dividend
The company`s dividend policy is to pay out half the annual earnings per share
as a dividend to shareholders.
Notice is hereby given that a cash dividend of 1,0 cent per share ("the
dividend") has been declared and is payable to shareholders recorded in the
books of Moneyweb at the close of business on Friday, 30 July 2010.
Shareholders are advised that the last day to trade "cum" the dividend will be
Friday, 23 July 2010. The shares will trade "ex" dividend as from Monday, 26
July 2010.
Payment will be made on Monday, 2 August 2010. Share certificates may not be
dematerialised or rematerialised during the period Monday, 26 July 2010 to
Friday, 30 July 2010, both days inclusive.
On behalf of the Board
Dr Andrew Smith
Executive Chairman
30 June 2010
Corporate Information
Non executive directors: E A Jay; L Sipoyo; T Ncube
Executive directors: Dr A Smith (Chairman), (CEO); A B Hogg; L M Hogg; DG
Wessels
Registration number: 1998/025067/06
Registered address: 20 The Piazza, Second Floor, Melrose Arch, 2196
Postal address: PO Box 8, Melrose Arch, 2076
Company secretary: D G Wessels
Telephone: (011) 344 8600
Facsimile: (011) 344 8601
Transfer secretaries: Computershare Investor Services (Pty) Limited
Auditors: BDO South Africa Incorporated
Designated Adviser: Vunani Corporate Finance
Date: 30/06/2010 11:53:01 Produced by the JSE SENS Department.
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