| Mon 14 Nov 2005, 12:35 | | Moneyweb - Unaudited Results For The Six Months E |
|
Moneyweb - Unaudited Results For The Six Months Ended 30 September 2005
MONEYWEB HOLDINGS LIMITED
("Moneyweb" or "the Company")
(Registration No: 1998/025067/06)
ISIN code: ZAE000025409
Share code: MNY
UNAUDITED RESULTS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2005
Moneyweb Holdings Limited
Consolidated Income Statements
Restated Restated
Unaudited Unaudited Unaudited
Six months Six months % Year
ended ended Change ended
30-Sep-05 30-Sep-04 31-Mar-05
R"000 R"000 R"000
Revenue 9,991 8,562 17% 16,829
EBITDA 620 (545) (2,355)
Depreciation & amortisation (251) (410) (842)
Operating income before
Investment income, income from
Associates, fair value adjustment
And impairment 369 (955) (3,197)
Impairment of goodwill (347) (14,318) (14,318)
Investment income 28 246 374
Net Income from associates
(Net of taxation) 286 286
Fair Value adjustment of
Investment (326)
Profit on disposal of investment 21
Profit / (loss) before taxation 50 (14,741) (17,160)
Income tax expense (28) 198 614
Basic profit / (loss) for the
period 22 (14,543) (16,546)
Basic Earnings/ (loss) per share
(cents) 0,03 (18,64) (21,26)
Fully diluted earnings /
(loss) per share (cents) 0,03 (18,52) (21,24)
Headline earnings /(loss) per
share (cents) 0,55 (0,29) (3,26)
Fully diluted headline Earnings
/ (loss) per share (cents) 0,54 (0,29) (3,25)
Reconciliation of headline earnings:
Net profit / (loss) for the period 22 (14,543) (16,546)
Impairment 347 14,318 14,318
Profit / (loss) on disposal of
Investments (326)
Fair value adjustment on
Investments 21
Headline Earnings / (Loss) 369 (225) (2,533)
Number of shares (000"s)
- issued closing
(net of treasury shares) 66 950 78 032 77 811
- weighted average 66 950 78 032 77 811
- fully diluted weighted
average 68 962 78 533 77 898
Moneyweb Holdings Limited
Consolidated Balance Sheets
Restated Restated
Unaudited Unaudited Unaudited
30-Sep-05 30-Sep-04 31-Mar-05
R"000 R"000 R"000
ASSETS
Non-current assets
Tangible assets 1,366 1,083 1,513
Intangible assets 556 347
Investment in associates 5,598
Other investment 3,016 12 3,016
Deferred taxation 1,049 286 948
5,431 7,535 5,824
Current assets
Trade and other receivables 2,908 3,789 2,153
Income tax prepaid 7
Cash and cash equivalents 1,669 5,075 2,538
4,577 8,871 4,691
Total assets 10,008 16,406 10,515
EQUITY AND LIABILITIES
Capital and reserves
Share capital and premium 5,380 9,295 6,257
Accumulated profit 916 2,894 891
Ordinary shareholders interest 6,296 12,189 7,148
Non-current liabilities
Shareholders" loan 438 438 438
Current liabilities
Trade and other payables 2,377 2,524 2,067
Provisions 118 289 343
Deferred revenue 695 964 509
Income tax payable 82 8
Shareholders for dividend 2 2 2
3,274 3,779 2,929
Total equity and liabilities 10,008 16,406 10,515
Net asset value per share (cps) 9,1 24,4 9,2
Net tangible asset value per share (cps) 9,1 15,1 8,7
Moneyweb Holdings Limited
Statement of changes in shareholders" equity
Share Capital Share Premium Accumlated Total
Profit
Balance at 1 April
2004 78 10,465 17,437 27,980
Net loss for the 6
Months ended 30
September 2004 (14,543) (14,543)
Capital Distribution (1,248) (1,248)
Balance at 30 Sep 2004 78 9,217 2,894 12,189
Net loss for the 6
Months ended 31 Mar
2005 (2,003) (2,003)
Treasury shares
Purchased (9) (3,029) (3,038)
Balance at 31 Mar 2005 69 6,188 891 7,148
Net profit for the 6
Months ended 30 Sep 2005 22 22
Treasury shares
Purchased (2) (872) (874)
67 5,316 913 6,296
Moneyweb Holdings Limited
Consolidated cash flow statements
Restated Restated
Unaudited Unaudited Unaudited
Six months Six months Year
ended ended ended
30-Sep-05 30-Sep-04 31-Mar-05
R"000 R"000 R"000
Cash flows from operating activities
Cash generated by operations 670 (992) (3,220)
Movements in working capital (472) (444) 751
Cash generated by operating activites 198 (1,436) (2,469)
Investment income 28 246 374
Normal taxation paid (114) (479) (710)
Capital distribution paid (1,248) (1,248)
Dividend received 588 589
Net cash flows from operating activities 112 (2,329) (3,464)
Cash flows from investing activities
To expand operations
Acquisition of tangible assets (104) (374) (1,041)
Acquisition of treasury shares (877) (3,038)
Loan advanced to associate (80) (105)
Repayment of loans to associates 312
Proceeds on disposal of associate
Company - Classic FM 2,000
Proceeds on disposal of associate
Company - Vestact 2
Proceeds on disposal of tangible assets 14
Net cash flows from investing
activities (981) (454) (1,856)
Net movement in cash and cash
equivalents for the period (869) (2,753) (5,320)
Cash and cash equivalents at
beginning of period 2,538 7,858 7,858
Cash and cash equivalents at
end of period 1,669 5,075 2,538
Moneyweb Holdings Limited
Supplementary notes to the adoption of International Financial Reporting
Standards (IFRS)
Reconciliation of equity
31-Mar-05 30-Sep-04 31-Mar-04
Equity previously reported 7,285 19,075 28,067
Equity adjustments
Impairment of goodwill (6,775)
Correction of expensing of
Operating Lease Payments (196) (159) (124)
Deferred tax adjustment 59 48 37
Equity reported under IFRS 7,148 12,189 27,980
Reconciliation of profit
Net Loss Previously reported (16,496) (7,743) (12,539)
Impairment of goodwill (6,775)
Correction of expensing of
Operating lease payments (72) (36) (124)
Deferred tax adjustment 22 11 37
Net Loss reported under IFRS (16,546) (14,543) (12,626)
COMMENTS
Moneyweb is delighted to report that the turnaround strategy has achieved its
objective of returning the business to profitability. After the disruptions of
last year, the Company now possesses the strongest delivery platforms in its
history, positioning it for strong growth in the period ahead.
Financial results
During the six months ended September, revenues rose 17% on the same half year
of 2004 and by 21% compared with the previous six months. Headline earnings per
share improved to 0,55c, comparing favourably with losses of 2,97c and 0,29c a
share respectively in the preceding half year periods.
The turnaround is most apparent in the cash generation line where the R2,2m
outflow during the six months to the end of March was turned into a positive
R670 000 for the half year under review.
In line with the decision to more efficiently utilize the Company"s cash
reserves, a further R877 000 was invested in buying back the Company"s own
shares. The cash holding, now R1,7m, is appropriate for a business of this size.
No plans have yet been made for the allocation of R3m in cash expected before
the end of the financial year as final settlement of Moneyweb"s sale of its
19,6% of Classic FM. Payment will be received on approval of the change in
shareholding by broadcasting regulator ICASA.
The Company has appointed new auditors, BDO Spencer Steward. The board thanks
the previous auditors, Grant Thornton, for their services over the years.
Operational results
As expected, securing a national FM platform for the Company"s flagship radio
programme was an important factor in the return to profitability. The impact was
felt throughout the business with the Moneyweb Power Hour"s dominant position in
business radio providing a useful cross-selling hook.
The local Internet platform, www.moneyweb.co.za, continued to perform well in
terms of both audience reach and advertising revenues. The Company"s
international arm, www.mineweb.com, has stabilized after reverses suffered last
year. It has regained its position as a pre-eminent global online site for
investment information on the resources sector.
Official statistics produced by the Online Publisher"s Association shows in
terms of audience reach Moneyweb is the country"s 10th biggest Internet
publishing house, a major achievement considering the tight niche, which it
serves.
The successful two and half year partnership with Caxton on The Citizen
newspaper has been elevated to a new level with the establishment of a full-
blown joint venture to produce the daily eight page Moneyweb Business insert.
The joint venture was launched on October 3.
Future prospects
Significant progress was made during the reporting period in positioning the
Company for strong organic growth and fulfilling the expectation that it will
resume the payment of dividends in the current financial year.
Mutually beneficial radio partnerships have been developed with SA Broadcasting
Corporation stations Radio 2000, RSG and Radio Lotus. Considerable progress has
been made in expanding this relationship to embrace more stations operated by
the national broadcaster.
The Moneyweb Business insert joint venture with Caxton offers great promise. The
self-contained publication in the preferred tabloid format, together with
Moneyweb"s tight focus on business issues, has met with ready acceptance from
readers. Advertising support has been growing and has been sufficient to ensure
a profitable start for the project.
A further joint venture which started after the reporting period, on
www.marketingweb.co.za, positions this website for a profitable future. Partner
Wag The Dog, is a highly professional, specialist media and advertising
publishing operation.
With all of the Company"s non-core assets disposed of and restructuring
completed, considerable management time and effort is now being invested in
crystallizing the Company"s international expansion strategy. This is aimed at
taking advantage of an offshore footprint developed over the years.
Almost two thirds of the Company"s substantial online audience resides outside
of South Africa. Before the end of the calendar year, a comprehensive plan to
exploit the business opportunity this offers will be presented for the board"s
consideration.
Implementation of International Financial Reporting Standards (IFRS)
The results for the six months ended 30 September 2005, and comparative
information, have been prepared in terms of International Financial Reporting
Standards (IFRS) expected to be applicable at 31 March 2006 and comply with
IAS34 - Interim Financial Reporting.
The financial statements for the year ending 31 March 2006 will be the group"s
first consolidated IFRS compliant financial statements, and hence IFRS1 - First
Time Adoption of IFRS has been applied in preparing this interim report.
At transition date, which is 1 April 2004, IFRS1 allows a number of exemptions
to the retrospective application of certain of the IFRS. An explanation of how
the transition to IFRS has affected the accounting policies adopted by the group
together with the exemptions of which the group has taken advantage, is provided
below:
IFRS2 - Share-based Payments: the group has elected not to apply IFRS2 to share
options granted before 7 November 2002. As all options outstanding were granted
before that date no adjustments have been necessary.
IFRS3 - Business Combinations: the group has elected to not restate acquisitions
made prior to the date of transition to IFRS. Under the previous accounting
policy goodwill was amortised over a period of 5 years, and the remaining
unamortised balance was tested for impairment. The carrying amount of goodwill
at the transition date becomes the deemed cost for the purposes of IFRS3 and is
tested annually for impairment.
IAS36 - Impairment of Assets: Substantially all of the remaining unamortised
balance of goodwill that arose on acquisition of the subsidiary was amortised
during the year ended 31 March 2005 and the small remaining balance was at the
time considered to have not been impaired. Therefore the results for the full
year ended 31 March 2005 do not require adjustment. However, the circumstances
that resulted in the poor financial performance of the subsidiary during the
year ended 31 March 2005 occurred prior to 30 September 2004, and accordingly
the amount of goodwill amortised for the year as a whole corresponds to the
amount of the impairment of goodwill that is considered to have occurred during
the six months then ended.
During the six months ended 30 September 2004 a significant interest in the
associated Company was sold (Classic FM). The balance of the investment held was
at the time reclassified as a financial instrument held in terms of IAS39 and
was measured at fair value. The amount previously accounted for as amortisation
of goodwill, together with the fair value adjustment of the remaining
investment, corresponds to the amount by which the goodwill arising on
investment in the associate was impaired.
Other Adjustments
Straight-lining of Operating Lease Payments
Payments made under operating leases are recognised in the income statement on a
straight-line basis over the term of the lease.
Previously operating lease payments were expended on a payments basis, which was
an interpretation that was generally accepted and applied in South Africa. The
new interpretation, with which the group is obliged to comply, is that operating
lease payments must be recognised on a straight line basis over the term of the
lease. The resulting adjustment has been accounted for in terms of IAS8 with the
necessary restatement of comparative figures.
Dividend
In line with prior year, no interim dividend is declared. This policy will be
reviewed at year end.
Andrew Smith Alec Hogg
Chairman Chief Executive Officer
Rosebank, Johannesburg
14 November 2005
Sponsor
Grant Thornton Corporate Finance (Pty) Ltd
Date: 14/11/2005 12:35:08 PM Produced by the JSE SENS Department
