| Wed 28 Jun 2006, 17:56 | | Moneyweb Holdings Limited - Provisional Audited Re |
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MNY
MNY
Moneyweb Holdings Limited - Provisional Audited Results For The
Year Ended 31 March 2006
MONEYWEB HOLDINGS LIMITED
(Registration No:1998/025067/06)
Share code:MNY & ISIN:ZAE000025409
("Moneyweb" or "the group")
PROVISIONAL AUDITED RESULTS FOR THE YEAR ENDED 31 MARCH 2006
* Financial turnaround confirmed, back into profit
* New strategic offshore and local partnerships secured
* Investment phase launched for Mineweb.com
* Relationship deepened through new SABC programmes
* Record reach for online, print and radio audiences
Consolidated Income Statement
Restated
Audited Audited
Year ended Year ended
31 March 2006 31 March 2005 % Change
R"000 R"000
REVENUE 19,268 16,829 14%
EBITDA 1,634 (2,355)
Depreciation and amortisation (495) (842)
Income before investment income,
income from associates, fair value
adjustment and impairment 1,139 (3,197)
Impairment of goodwill (347) (14,318)
Investment income 40 374
Net income from associates
(net of taxation) - 286
Profit on disposal of
Investments - 21
Fair value adjustment of investments 6 (326)
PROFIT/LOSS BEFORE TAXATION 838 (17,160)
Income tax expense (404) 614
BASIC PROFIT/LOSS FOR THE YEAR 434 (16,546)
BASIC EARNINGS/LOSS PER SHARE (cents) 0,65 (21,26)
FULLY DILUTED EARNINGS/LOSS PER
SHARE (cents) 0,64 (21,24)
HEADLINE EARNINGS/LOSS PER SHARE
(cents) 1,14 (2,47)
FULLY DILUTED HEADLINE EARNINGS/LOSS
PER SHARE (cents) 1,14 (2,47)
Reconciliation of headline earnings:
Basic profit/loss for the year 434 (16,546)
Impairment 347 14,318
Profit on disposal of investment - (21)
Fair value adjustment of investments (6) 326
HEADLINE EARNINGS 775 (1,923)
Number of shares (000"s) (Net of Treasury shares)
- issued closing 66 950 77 811
- weighted average 67 923 77 811
- fully diluted weighted average 68 000 77 898
Consolidated Balance Sheet
Restated
Audited as at Audited as at
31 March 2006 31 March 2005
R"000 R"000
ASSETS
Non-current assets
Tangible assets 1,168 1,513
Intangible assets - 347
Other investment 21 3,016
Deferred taxation 676 948
1,865 5,824
Current assets
Trade and other receivables 3,894 2,153
Cash and cash equivalents 4,077 2,538
7,971 4,691
Total assets 9,836 10,515
EQUITY AND LIABILITIES
Capital and reserves
Share capital and premium 5,383 6,257
Accumulated profit 1,324 891
6,707 7,148
Current liabilities
Trade and other payables 2,362 2,505
Provisions 216 343
Deferred revenue 431 509
Income tax payable 118 8
Shareholders for dividend 2 2
3,129 3,367
Total equity and liabilities 9,836 10,515
Net asset value per share (cents) 9,9 9,2
Net tangible asset value per share (cents) 9,9 8,7
Statement of changes in shareholders" equity
Share Capital Share Premium Accumulated Total
Profit
Balance at 1 April
2004 78 10,465 17,437 27,980
Net loss for the year
ended 31 March 2005 (16,546) (16,546)
Treasury shares purchased (9) (3,029) (3,038)
Capital Distribution (1,248) (1,248)
Balance at 1 April 2005 69 6,188 891 7,148
Net profit for the year
Ended 31 March 2006 433 433
Treasury shares purchased (2) (872) (874)
67 5,316 1,324 6,707
Consolidated Cash Flow Statements
Audited Restated Audited
Year ended Year ended
31 March 2006 31 March 2005
R"000 R"000
Cash flows from operating activities
Cash generated from operations 1,555 (3,220)
(Increase)/decrease in working capital (2,010) 751
Cash generated from operating activities (455) (2,469)
Investment income 40 374
Dividends Received - 589
Capital distribution paid - (1,248)
Normal taxation paid (22) (710)
Cash flows from operating
activities (437) (3,464)
Cash flows from investing activities
Acquisition of tangible assets (150) (1,041)
Repayment of loans from associates - 312
Loan advanced to associate - (105)
Proceeds on disposal of Classic FM 3,000 2,000
Proceeds on disposal of Vestact - 2
Proceeds on disposal of tangible assets 14
Cash flows from investing
activities 2,850 1,182
Cash flows from financing activities
Acquisition of treasury shares (874) (3,038)
Net movement in cash and cash
equivalents for the year 1,539 (5,320)
Cash and cash equivalents at
beginning of the year 2,538 7,858
Cash and cash equivalents at
end of the year 4,077 2,538
Supplementary notes to the adoption of International Financial Reporting
Standards
Reconciliation of equity
31 March 2005 31 March 2004
R"000 R"000
Equity previously reported 7,285 28,067
Equity adjustments
Correction of expensing of
operating lease payments (196) (-124)
Deferred tax adjustment 59 37
Equity reported under IFRS 7,148 27,980
Reconciliation of profit
Net loss previously reported (16,496) (12,539)
Correction of expensing of operating
lease payments (72) (124)
Deferred tax adjustment 22 37
Net loss reported under IFRS (16,546) (12,626)
The application of International Financial Reporting Standards has had no effect
on the cash flow statement
ACCOUNTING POLICIES
The results for the year ended 31 March 2006, and comparative information, have
been prepared in terms of International Financial Reporting Standards (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, are provided below
- IFRS2 - Share-based Payments: The group has elected not to apply IFRS2 to
share options granted before 7 November 2002. All outstanding options were
granted before that date and therefore no adjustments have been necessary.
- IFRS3 - Business Combinations: The group has elected not to 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
financial year ended 31 March 2005 do not require adjustment and the remaining
goodwill has been impaired during the current year.
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.
COMMENTARY
FINANCIAL:
Audited results for the financial year ended March 2006 show that the turnaround
promised a year ago has been achieved. The prior year"s headline loss of R1,9
million (-2,5 cents per share) has been improved to earnings of R775 000
(+1,1cents per share). Operating cash flow of a positive R1,5 million compares
with the previous year"s outflow of R3,2 million. Tangible net asset value which
excludes Moneyweb"s most valuable asset - its brands - improved by 13,8% from
8,7 cents a share to 9,9 cents.
OPERATIONAL:
The past year saw record audience reach being achieved by the online, print and
radio platforms.
Since May 2005, the market leading Moneyweb Power Hour radio programme has been
broadcast on the SABC"s national FM station Radio 2000, making it available to
the entire country for the first time. This programme, broadcast daily from 6pm
to 7pm, is complemented by the Afrikaans-language Geldsake met Moneyweb,
broadcast on RSG (5pm to 6pm) and daily drive time crossings to Lotus FM, which
targets the affluent Indian community. A foundation has been created from which
growth in advertising revenues is sure to follow the growing audiences.
The group"s flagship, investment and business news website Moneyweb.co.za,
continues to grow at a rapid clip with unique visitors to its home page rising
at an annualized rate well into double figures. Online advertising revenues,
although higher in the year under review, did not keep pace with the audience
growth. This is mainly the result of continued difficulties experienced in South
Africa"s conversion to globally competitive broadband pricing and
infrastructure. After a difficult 2004, Mineweb.com stabilized and has now
established a base from which an aggressive global growth strategy can be
launched. The joint venture with Wag The Dog Publishing on marketingweb.co.za
has been successful virtually from the outset with the site now making a
positive financial contribution.
The relationship with major South African publishing group Caxton was further
strengthened through October"s formation of a joint venture partnership on the
eight-page Moneyweb Business supplement which is inserted daily into The Citizen
newspaper. Although advertising revenues have been slow to follow the product"s
improvement, readership penetration into the corporate executive market has been
promising. The two companies are continuously exploring ways in which to
collaborate more closely.
Moneyweb was once again honoured at the annual Sanlam and Citadel financial
journalism competitions, producing substantially more finalists than any of its
competitors and prevailing in a number of the categories. The Moneyweb Power
Hour was adjudged best business radio programme in South Africa in both
competitions for the seventh successive year.
PROSPECTS:
That Moneyweb is back into a growth phase is reflected by numerous developments
subsequent to the financial year end. Among the most significant of these are:
The partnership struck with the Wall Street Journal (WSJ), the best selling
business newspaper in the world. Moneyweb has secured the exclusive right to
publish two pages daily of WSJ content in its joint venture newspaper, Moneyweb
Business. It has also secured the right to republish a maximum of six WSJ
articles daily on Moneyweb.co.za. The agreement kicks off on July 1.
A joint venture with Irish-headquartered The Investment Club Network (TICN), a
global leader in the training of members and management of stock market
investment clubs. This follows TICN"s successful launch into Nigeria where it
has attracted over 2 000 members within the first 18 months of operation. The
first local clubs will be established in mid-August.
The relocation of the Mineweb.com operations offshore enabling it to better
serve its global audience, 93% of whom are based outside of South Africa. Former
Financial Times journalist and Decision Media executive Jenny Luesby has been
appointed Mineweb CEO and given a mandate to appoint suitable staff to drive the
global expansion.
In a partnership with leading KwaZulu Natal newspaper the Weekend Witness,
during May the company started providing a four-page broadsheet section on
personal finance. This is the first joint venture between Moneyweb and Naspers,
South Africa"s largest media group.
The relationship with the national broadcaster has been expanded through the
production of three new weekly radio programmes for Radio 2000 - Investing 101;
Personal Finance Live; and the first ever Sotho-language business programme.
Planning is well advanced for a mid-July"s launch of the first ever Pan African
daily business radio programme, also in partnership with the SABC.
The board is confident that Moneyweb"s turnaround is now on track. The group has
sufficient financial resources to fund those areas of expansion which will not
immediately be cash generating. Earnings in the year to March 2007 will be
affected by the numerous new ventures, but the board is confident that real
growth in earnings will be achieved.
AUDITORS REPORT
The Group"s auditors, BDO Spencer Steward (Jhb) Inc, have audited the financial
information for the year to 31 March 2006. Their unqualified audit report is
available for inspection at the registered office of Moneyweb.
DIVIDENDS
In line with the company"s policy of distributing half of its headline earnings,
a dividend of 0,5cents a share has been declared. Although this represents a
nominal payment, it reflects the financial stability of the business and a
determination by the board to establish the company as a regular dividend payer.
Notice is hereby given that a cash dividend of 0,5 cents 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, 28 July 2006. Shareholders
are advised that the last day to trade "cum" the dividend will be Friday, 21
July 2006. The shares will trade "ex" dividend as from Monday, 24 July 2006.
Payment will be made on Monday, 31 July 2006. Share certificates may not be
dematerialised or rematerialised during the period Monday, 24 July 2006 to
Friday, 28 July 2006, both days inclusive
Andrew Smith Alec Hogg
Chairman Chief Executive Officer
Rosebank, Johannesburg
28 June 2006
Registered office:
First Floor, West Wing
President Place
Corner Jan Smuts Avenue and Bolton Road
Rosebank 2196
Directors:
AB Hogg
EA Jay*
LM Hogg
V Nosi*
A Smith*
*non executive
Sponsor
Merchant Sponsors (Pty)Ltd
Moneyweb Holdings Limited
Date: 28/06/2006 05:56:55 PM Produced by the JSE SENS Department
