Strong Margin Increase In First Half of 2003
- EPS* 10.7p (8.9p) up 20 per cent
- Profit before tax* 45.5m pounds (40.7m pounds) up 12 per cent
- Operating* margin 12.2 per cent (9.1 per cent)
- Net cash balances boosted to 118.9m pounds (93.5m pounds at
31 December 2002)
- Dividend increases to 3.3p (3.0p) up 10 per cent
* Before amortisation of goodwill and prior year exceptional items
LONDON, July 29 /PRNewswire-FirstCall/ --
Clive Hollick, Chief Executive of United Business Media, said:
"United has delivered a good performance in the first half of 2003 with
profit before tax and earnings per share ahead of last year by 12 per cent and
20 per cent respectively. Although underlying revenues are down 6 per cent
compared with the first half of 2002 there has been a welcome stabilisation in
revenue trends over the last six months and early signs of an improvement in
certain markets in the US. This modest improvement, combined with the
continuing drive for operating efficiencies, has boosted operating margins
from 9 per cent last year to 12 per cent this year. 200m pounds of cost
savings have now been secured, this represents approximately 30 per cent of
the 2000 fixed cost base.
"Yields and key market shares have either been maintained or slightly
increased across the group. The level of revenue from new products started in
the last two years increased in the first half year to 17 million pounds.
Losses attributable to new product development increased to 5m pounds
(1m pounds). Cash conversion remains strong at 105 per cent of operating
profits and net cash balances were 118.9 million pounds at 30 June.
"Professional media profits grew by 75 per cent thanks to a return to
profit at CMP in the US and a good improvement in margins at CMPi in the UK,
offset by a fall in the CMP Asia profits following the SARS outbreak.
Revenues in the US have been broadly stable in the last four quarters with
improvements in the reseller technology and healthcare markets offset by
continued weakness in electronics. Market share continues to edge ahead,
yields are being maintained and further reductions in the cost base are being
delivered.
"CMPi's profits in the second half will be boosted by the recent
acquisitions of Builder Group, Barbour Index, Property Media and Interior
Design Handbook. In 2004 these acquisitions, which together cost 83m pounds,
are expected to contribute operating profits of 9 million pounds. Margin
improvements at Exchange & Mart and Daltons Weekly helped to lift UAP's
profits.
"Trading at CMP Asia is beginning to improve as the SARS outbreak abates.
The total adverse effect on earnings in the first six months was slightly
below our forecast of 8 million pounds before insurance recoveries.
"Our news distribution business, PR Newswire, delivered a good margin
increase on the second half of 2002. After three successive quarters of
stable US message volumes the second quarter of 2003 saw a quarterly increase
of almost 10 per cent and a small year on year strengthening of yields.
"NOP World, our market research business, achieved a near doubling of
margins to 11.1 per cent compared with the second half of 2002. There are now
early indications of modest improvements in healthcare revenues and some
stability in the US custom business.
"five (formerly Channel 5) continues to make excellent progress with
strong gains in advertising share. After six years of investment five
delivered an operating profit in the first half of 2003.
"Forward revenue visibility remains limited, but with the recent
stabilisation in revenue trends, some improvement in certain US markets, a
gradual return to normal trading conditions in Asia and the boost to margins
from improved operating efficiencies throughout the group, should deliver an
improvement in United's year on year performance in the second half of 2003.
We plan to increase the level of investment in new products and make
acquisitions which strengthen our core business and meet our demanding
financial criteria."
SUMMARY PROFIT & LOSS STATEMENT
The group profit and loss statement set out below re-presents the group's
full profit and loss account (which is included in the attached financial
information) in order to show more clearly the results from operations
excluding amortisation of goodwill and prior year exceptional items.
Restated (1)
Period Period
ended ended
30 June 30 June
2003 2002 Variance
m pounds m pounds %
Turnover 344.0 412.8 (16.7)
Operating profit* 42.0 37.4 12.3
Net interest income 6.2 4.3 44.2
Other finance expense (FRS 17) (2.7) (1.0) (170.0)
Profit before tax* 45.5 40.7 11.8
Amortisation of goodwill (53.3) (65.8) 19.0
(7.8) (25.1) 68.9
Exceptional items -- (14.0) --
Loss before tax (7.8) (39.1) 80.1
Taxation (10.0) (9.8) (2.0)
Loss on ordinary activities
after tax (17.8) (48.9) 63.6
Equity minority interest 0.3 (1.4) 121.4
Loss for the period (17.5) (50.3) 65.2
Dividends - equity (11.0) (10.1) 8.9
- non-equity (0.3) (0.3) --
(11.3) (10.4) 8.7
Retained loss for the period (28.8) (60.7) 52.6
EPS* (pence) 10.7 8.9 20.2
Basic EPS (pence) (5.3) (15.1) 64.9
Dividend per share 3.3 3.0 10.0
(1) 2002 has been restated to include the impact of adopting FRS17
"Retirement Benefits"
* Before amortisation of goodwill and prior year exceptional items
CONTENTS
1. Summary of Results
2. Divisional Review
3. Dividend
4. Balance Sheets and Cash Conversion
5. Fixed Asset Investments
6. Tax
1. SUMMARY OF RESULTS
Group Turnover Group Operating Profit
Six months to 30 June Six months to 30 June
(m pounds) (m pounds)
2003 2002 Change Underlying 2003 2002 Change Underlying
(%) #(%) (%) g #(%)
CMP Media 101.8 129.9 (21.6) (10.0) 4.9 (7.3) -- --
CMP Asia 14.0 25.5 (45.1) -- (0.7) 7.7 -- --
CMP
Information (14.8) 58.7 68.9 (8.4) 10.7 6.3 69.8 58.1
UAP 29.5 29.5 -- -- 8.9 6.9 29.0 19.4
Professional
Media 204.0 253.8 (19.6) (6.8) 23.8 13.6 75.0 160.0
News
Distribution 48.0 57.5 (16.5) (6.8) 8.0 12.3 (35.0) (30.3)
Market
Research 92.0 101.5 (9.4) (2.1) 10.2 11.5 (11.3) (16.1)
Total 344.0 412.8 (16.7) (5.6) 42.0 37.4 12.3 29.9
# Underlying:
- adjusted for the estimated effects of acquisitions, foreign exchange,
SARS and biennial events
Although group revenue was down 16.7 per cent to 344.0m pounds,
significant improvements in operational efficiency secured a 12.3 per cent
increase in operating profits. The operating margin increased to 12.2 per
cent from 9.1 per cent in the first half of 2002.
The underlying decline in group turnover was only 5.6 per cent, with the
reported number having been depressed by foreign exchange (31m pounds), SARS
(9m pounds), business closures (6m pounds) and biennial exhibitions
(4m pounds).
The sterling / US dollar exchange rate has a translation impact upon
consolidation. For the six month period a 1 cent movement in the US dollar
against sterling was equivalent to a move in profit of between 100,000 pounds
and 200,000 pounds.
2. DIVISIONAL REVIEW
Professional Media
Turnover Operating Profit
Six month periods Six month periods
(m pounds) (m pounds)
2003 2002 2002 2003 2002 2002
H1 H2 H1 H1 H2 H1
CMP Media 101.8 108.3 129.9 4.9 0.5 (7.3)
CMP Asia 14.0 25.6 25.5 (0.7) 6.0 7.7
CMP Information 58.7 58.7 68.9 10.7 3.8 6.3
UAP 29.5 28.6 29.5 8.9 5.8 6.9
Total 204.0 221.2 253.8 23.8 16.1 13.6
Total Professional Media revenue was 204.0m pounds, down 19.6 per cent on
H1 2002. Operating profit was 23.8m pounds, up 75.0 per cent on H1 2002, with
cost reductions driving this improvement and CMP Media in particular turning a
loss of 7.3m pounds into a 4.9m pounds profit despite a decline in revenue of
28.1m pounds. The total divisional operating margin of 11.7 per cent
represents a significant improvement on 5.4 per cent in H1 2002 and 7.3 per
cent in H2 2002.
CMP Media
The 21.6 per cent decline in CMP Media's revenues was more than offset by
cost savings and CMP Media delivered a half year operating profit of 4.9m
pounds.
Over the first six months of 2003 CMP Media's continuing titles again
increased their market share of advertising page volumes, up to 29.4 per cent
(from 27.5 per cent), and also increased yields by 1.5 per cent.
Overall the conditions in CMP's technology marketplace broadly stabilised
in late 2002 / early 2003, although there are different trends in each of
CMP's product areas with the Channel market consistently strong -- revenue up
11 per cent -- and, at the other end of the scale, Electronics was
consistently weak -- revenue down 23.2 per cent. Both the Channel area and
online -- across the division -- performed ahead of plan in H1 2003. CMP
Media new product development activity continued with Optimize generating over
$1.5m in the period, and the Institute for Partner and Educational Development
making significant progress and being ahead of budget.
Approximately 10 per cent of CMP Media's revenues come from its Healthcare
division and this was its strongest growth area in the first half, with
revenues up 14 per cent. Sales demand is good and new initiatives made a
solid contribution with Continuing Medical Education (CME) teleconferences
continuing to receive requests for proposals and performing ahead of budget.
CMP Asia
The adverse earnings impact of SARS was slightly below our previous
estimate.
The Spring 2003 Leather Fair in Hong Kong was cancelled with a full refund
to customers and several other exhibitions were postponed. The June Jewellery
Fair went ahead, although inevitably with lower levels of attendance.
New launches continued and included a Jewellery trade fair in Shenzhen,
beauty trade and natural health publications in Japan and also two beauty
trade conferences in New York. These shows and publications generated US
$2.3m in new revenue. Events launched in 2002 in Bangkok, Tokyo and China
continued to grow in 2003.
CMP Information
The overriding theme of the performance at CMPi* has been one of major
improvement in margins leading to profitability growth of 70 per cent or 4.4m
pounds.
CMPi revenue of 58.7m pounds (68.9m pounds) was 14.8 per cent down on 2002
because of closures and also a biennial effect. Half of the underlying fall
of 8.4 per cent related to the weakness of the Network Telecoms show which is
now under review. The extensive programme of initiatives to improve
operational efficiencies generated an operating margin of 18.2 per cent (9.1
per cent) and enabled CMPi to grow profit to 10.7m pounds (6.3m pounds).
The first half of the year also saw the completion of two acquisitions --
the remaining 50% of Property Media and the purchase of Interior Design
Handbook -- the integration of both has since been completed according to
plan.
Last week UBM announced the acquisition of Builder Group and Barbour Index
for 79m pounds. These will be integrated into CMPi, and together with
Property Media and the Interior Design Handbook have significantly
strengthened CMPi's leadership position in the UK construction and design
market.
Organic initiatives included several successful exhibitions -- Technology
for Marketing, ACPO and FI China -- which between them generated well over
2m pounds in revenue.
* CMPi results (and prior period comparatives) now include CMP Europe
following the transfer from CMP Media at the start of 2003.
UAP
UAP delivered another strong performance with operating profit up almost
30 per cent at 8.9m pounds due to increased operating efficiencies and an
improved margin of 30.2 per cent (23.4 per cent).
Revenue at 29.5m pounds was the same as in 2002 as gains at Daltons
Weekly, Private Villas, Trader, Trade It and online properties offset weaker
performances at Auto Exchange and the Computer titles.
Organic initiatives included DaltonsBusiness.com, the early success of
which contributed significantly to growth in online revenues across the
business of over 70 per cent.
PR Newswire - News Distribution
Turnover Operating Profit
Six month periods Six month periods
(m pounds) (m pounds)
2003 2002 2002 2003 2002 2002
H1 H2 H1 H1 H2 H1
PR Newswire 48.0 47.9 57.5 8.0 5.0 12.3
Further action on costs delivered a 60 per cent improvement in
profitability on the second half of 2002. In addition, a sustained period of
stability was followed in the second quarter of 2003, by indications of
improvements in core US message volumes and revenues.
Revenue at 48.0m pounds was the same as in the second half of 2002, but
down on the first half of 2002. Operating profit improved from 5.0m pounds in
H2 2002 to 8.0m pounds in H1 2003, a margin improvement from 10.4 per cent to
16.7 per cent.
America
Core US message volumes reached a high of 49k in the second quarter of
2002 and then declined to 42k in each of the following three quarters. The
second quarter of 2003 then saw an improvement to 46k with June volumes up 3.7
per cent on June 2002. M&A, IPO and new product announcements all improved in
May and June.
Growth in organic initiatives such as MultiVu and Online MediAtlas (OMA)
offset declines in mature services such as Broadcast Fax.
Rest of the World
Overall PR Newswire's businesses outside America improved to break even in
the first half of 2003. Total revenue from organic initiatives, Disclose, OMA
and News Monitoring was up by 33 per cent.
NOP World - Market Research
Turnover Operating Profit
Six month periods Six month periods
(m pounds) (m pounds)
2003 2002 2002 2003 2002 2002
H1 H2 H1 H1 H2 H1
NOP World 92.0 111.5 101.5 10.2 6.4 11.5
Operating profit increased from 6.4m pounds in H2 2002 with NOPW achieving
10.2m pounds in the first half of 2003. The margin performance at NOPW was
strong with the first half delivering 11.1 per cent, double H2 2002 and in
line with H1 2002.
Mediamark Research (MRI)
MRI, NOP World's largest profit contributor, is performing slightly ahead
of expectations with both revenue and profit ahead of the first half of 2002.
The core National Study product delivered both higher renewal rates and new
business.
Allison-Fisher (AFI)
Revenues in the first half were 28 per cent ahead of the same period last
year. The majority of calendar year renewals have now been booked and the
organic initiatives (international product expansions) are well under-way and
anticipated to meet full year objectives.
NOP Research Group
In a challenging environment, NOP Research increased marketing and sales
activity and generated sufficient new business to hold revenue close to the
levels in H1 2002.
A weak first quarter was followed by a good second quarter. NOP's
strengths in Financial, Business and Mystery Shopping were offset by some
weakness in Automotive and Healthcare. Investments included a Mystery Shopping
organic initiative.
RoperASW
Conditions in RoperASW's US markets (custom, consumer trends and retail
markets) remained flat in the first half of the year, although there have been
some more positive indications in the technology market. Consequently
revenues are still down on H1 2002 but -- boosted by better than expected
operating efficiency gains -- RoperASW improved its profit on the first half
of 2002.
Market Measures Cozint (MMC) / Strategic Marketing Corporation (SMC)
These Healthcare businesses continue to operate in a difficult market but
the drug approval pipeline appears to be improving. Both saw a significant
deterioration in the second half of 2002. SMC is showing healthy revenue and
profit progress, benefiting from increased numbers of drug approvals and from
an upgraded sales and marketing programme whilst MMC was down on H1 2002 and
is addressing structural issues in its product offering. In particular sales
of the Global Tracking business have been strong.
3. DIVIDEND
An interim dividend of 3.3 pence per share for 2003 will be paid. This is
in line with the Board's dividend policy announced in December 2001.
The interim dividend will be paid on 23 October to shareholders on the
register on 15 August.
4. BALANCE SHEET AND CASH CONVERSION
Net cash balances at the end of the period were 118.9m pounds. Operating
cash conversion was 105 per cent of operating profits.
Group capital expenditure was held to 3.3m pounds during the period
(compared with 10.9m pounds in 2002), well below the level of depreciation at
9.5m pounds. Cash outflows for the period included 4.3m pounds of additional
funding for five. Cash was boosted by net tax receipts of 7.6m pounds in
respect of prior periods.
In June the group purchased a total of 100,000 ordinary shares in the
market for cancellation.
5. FIXED ASSET INVESTMENTS
UBM holds investments in five, ITN, SIS, SDN, Paperloop and the Press
Association. five revenue grew 7.1 per cent, its audience share held firm at
6.6 per cent, and its share of advertising revenue increased from 7.3 per cent
to 7.8 per cent.
Income from investments of 3.2m pounds includes dividends received from
SIS and ITN.
6. TAX
The effective tax rate in H1 2003 was 21.9 per cent against 24.0 per cent
in H1 2002.
Notes to Editors:
United Business Media plc (http://www.unitedbusinessmedia.com) is a
leading provider of business information services to the technology,
healthcare, media, automotive and financial services industries. UBM offers
services in market research, consultancy, news distribution, publishing and
events to customers across the globe. Its brands include NOP World, one of
the largest market research groups globally; PR Newswire, the world's leading
corporate news distribution service and CMP, the B2B media and exhibition
group operating in high-tech, healthcare, property, entertainment jewellery
& fashion in the US, UK, Asia and Europe.
This press release includes statements which are not historical facts and
are considered "forward-looking" within the meaning of Section 27 of the
Securities Act of 1933, as amended. These forward-looking statements reflect
UBM's current views about future events, business and growth strategy and
financial performance. These forward-looking statements are identified by
their use of terms and phrases such as "believe," "expect," "plan,"
"anticipate," "on target" and similar expressions identifying forward-looking
statements. Investors should not rely on forward-looking statements because
they are subject to a variety of risks, uncertainties and other factors that
could cause actual results to differ materially from UBM's expectations. UBM
expressly does not undertake any duty to update forward-looking statements.
Management does not attempt to update forecasts unless conditions materially
change.
Group profit and loss account
for the six months ended 30 June 2003
Six months ended 30 June 2003 Six months ended 30 June 2002
As restated As restated
Before Exceptional Before Exceptional As
Notes exceptional items exceptional items restated
items (note 2) Total items (note 2) Total
m pounds m pounds m pounds m pounds m pounds m pounds
Turnover - group and
share of joint ventures
Continuing
operations 354.3 -- 354.3 425.4 -- 425.4
Acquisitions 1.4 -- 1.4 -- -- --
355.7 -- 355.7 425.4 -- 425.4
Less: share of
joint ventures'
turnover (11.7) -- (11.7) (12.6) -- (12.6)
Group turnover 344.0 -- 344.0 412.8 -- 412.8
Group operating loss
Continuing
operations (15.7) -- (15.7) (32.3) -- (32.3)
Acquisitions 0.2 -- 0.2 -- -- --
Group operating
loss (15.5) -- (15.5) (32.3) -- (32.3)
Share of
operating
profit
in joint
ventures
and
associates 3 1.0 -- 1.0 0.5 -- 0.5
Income from other
fixed asset
investments 3.2 -- 3.2 3.4 -- 3.4
Total operating
loss (11.3) -- (11.3) (28.4) -- (28.4)
Loss on sale and
closure of businesses
Discontinued
operations -- -- -- -- (14.0) (14.0)
Loss on ordinary
activities before
interest (11.3) -- (11.3) (28.4) (14.0) (42.4)
Net interest
income 4 6.2 -- 6.2 4.3 -- 4.3
Other finance
expense (2.7) -- (2.7) (1.0) -- (1.0)
Loss on ordinary
activities before
tax (7.8) -- (7.8) (25.1) (14.0) (39.1)
Tax on loss on
ordinary
activities (10.0) -- (10.0) (9.8) -- (9.8)
Loss on ordinary
activities after
tax (17.8) -- (17.8) (34.9) (14.0) (48.9)
Equity minority
interests 0.3 -- 0.3 (1.4) -- (1.4)
Loss for the
period (17.5) -- (17.5) (36.3) (14.0) (50.3)
Dividends
- equity 7 (11.0) (10.1)
- non-equity 7 (0.3) (0.3)
7 (11.3) (10.4)
Retained loss
for the period (28.8) (60.7)
Earnings/(loss) per share
- before amortisation of
intangible assets and
exceptional
items 5 10.7p 8.9p
- basic 5 (5.3)p (15.1)p
- diluted 5 (5.3)p (15.1)p
Group profit and loss account
for the six months ended 30 June 2003
Year ended 31 December 2002
Notes As restated As restated
Before Exceptional
exceptional items As restated
items (Note 2) Total
m pounds m pounds m pounds
Turnover - group
and share of
joint ventures
Continuing operations 819.2 -- 819.2
Acquisitions -- -- --
819.2 -- 819.2
Less: share of joint
ventures' turnover (25.8) -- (25.8)
Group turnover 793.4 -- 793.4
Group operating loss
Continuing operations (83.0) (144.2) (227.2)
Acquisitions -- -- --
Group operating loss (83.0) (144.2) (227.2)
Share of operating profit
in joint ventures and
associates 3 1.6 -- 1.6
Income from other
fixed asset
investments 10.4 -- 10.4
Total operating loss (71.0) (144.2) (215.2)
Loss on sale and closure
of businesses
Discontinued operations -- (14.0) (14.0)
Loss on ordinary activities
before interest (71.0) (158.2) (229.2)
Net interest income 4 10.1 -- 10.1
Other finance expense (2.1) -- (2.1)
Loss on ordinary activities
before tax (63.0) (158.2) (221.2)
Tax on loss on ordinary
activities (16.0) -- (16.0)
Loss on ordinary activities
after tax (79.0) (158.2) (237.2)
Equity minority interests
(1.8) -- (1.8)
Loss for the period (80.8) (158.2) (239.0)
Dividends
- equity 7 (23.6)
- non-equity 7 (0.6)
7 (24.2)
Retained loss for the
period (263.2)
Earnings/(loss) per share
- before amortisation
of intangible assets
and exceptional
items 5 16.5p
- basic 5 (71.6)p
- diluted 5 (71.6)p
Analysis of turnover
for the six months ended 30 June 2003
Six months ended Six months ended Year ended
30 June 2003 30 June 2002 31 December 2002
Group Group Group
share share of share of
Group of joint Group joint Group joint
m pounds ventures m pounds ventures m pounds ventures
m pounds m pounds m pounds
Turnover by division
Continuing operations:
CMP Media 101.8 4.2 129.9 4.2 238.2 9.0
CMP Asia 14.0 1.6 25.5 1.8 51.1 3.6
CMP Information 57.3 1.2 68.9 2.0 127.6 4.5
United Advertising
Publications 29.5 -- 29.5 -- 58.1 --
Professional
media 202.6 7.0 253.8 8.0 475.0 17.1
News distribution 48.0 4.7 57.5 4.6 105.4 8.7
Market research 92.0 -- 101.5 -- 213.0 --
Continuing
operations 342.6 11.7 412.8 12.6 793.4 25.8
Acquisitions:
CMP Information 1.4 -- -- -- -- --
Acquisitions 1.4 -- -- -- -- --
Turnover 344.0 11.7 412.8 12.6 793.4 25.8
by geographic market
United Kingdom 110.8 1.2 119.3 2.0 216.6 4.5
North America 217.9 8.5 266.8 8.5 502.2 17.0
Europe and
Middle East 4.4 0.4 3.5 0.3 28.1 0.7
Pacific 10.9 1.6 23.2 1.8 46.5 3.6
Turnover 344.0 11.7 412.8 12.6 793.4 25.8
Analysis of activities
for the six months ended 30 June 2003
Six months ended 30 June 2003
Group
share Exceptional
Group of joint Subtotal items Total
m pounds ventures m pounds m pounds m pounds
m pounds
Operating
profit/ (loss)
before amortisation
of intangible assets
by division
Continuing operations:
CMP Media 4.8 0.1 4.9 -- 4.9
CMP Asia (0.9) 0.2 (0.7) -- (0.7)
CMP Information 10.4 -- 10.4 -- 10.4
United Advertising
Publications 8.9 -- 8.9 -- 8.9
Professional
media 23.2 0.3 23.5 -- 23.5
News distribution 6.5 1.5 8.0 -- 8.0
Market research 10.2 -- 10.2 -- 10.2
Continuing
operations 39.9 1.8 41.7 -- 41.7
Acquisitions:
CMP Information 0.3 -- 0.3 -- 0.3
Acquisitions 0.3 -- 0.3 -- 0.3
Operating profit
before amortisation
of intangible
assets 40.2 1.8 42.0 -- 42.0
Amortisation of
intangible
assets (52.5) (0.8) (53.3) -- (53.3)
Operating (loss)/
profit by division
Continuing operations:
CMP Media (18.0) (0.2) (18.2) -- (18.2)
CMP Asia (7.7) 0.2 (7.5) -- (7.5)
CMP Information (3.9) -- (3.9) -- (3.9)
United Advertising
Publications 8.5 -- 8.5 -- 8.5
Professional
media (21.1) -- (21.1) -- (21.1)
News distribution 4.1 1.0 5.1 -- 5.1
Market research 4.5 -- 4.5 -- 4.5
Continuing
operations (12.5) 1.0 (11.5) -- (11.5)
Acquisitions:
CMP Information 0.2 -- 0.2 -- 0.2
Acquisitions 0.2 -- 0.2 -- 0.2
Operating loss (12.3) 1.0 (11.3) -- (11.3)
Non-operating
exceptional items --
Net interest and
other financial
income 3.5
Loss on ordinary
activities before tax (7.8)
by geographic market
United Kingdom 8.4 -- 8.4 -- 8.4
North America (9.0) 1.1 (7.9) -- (7.9)
Europe and Middle
East (2.8) (0.3) (3.1) -- (3.1)
Pacific (8.9) 0.2 (8.7) -- (8.7)
Operating loss (12.3) 1.0 (11.3) -- (11.3)
Non-operating
exceptional items --
Net interest and
other financial
income 3.5
Loss on ordinary
activities before
tax (7.8)
Analysis of activities
for the six months ended 30 June 2003
Six months ended 30 June 2002
Group
share of
joint Exceptional
Group ventures Subtotal items Total
m pounds m pounds m pounds m pounds m pounds
Operating profit/ (loss)
before amortisation of
intangible assets by division
Continuing operations:
CMP Media (7.4) 0.1 (7.3) -- (7.3)
CMP Asia 7.5 0.2 7.7 -- 7.7
CMP Information 6.2 0.1 6.3 -- 6.3
United Advertising
Publications 6.9 -- 6.9 -- 6.9
Professional media 13.2 0.4 13.6 -- 13.6
News distribution 10.8 1.5 12.3 -- 12.3
Market research 11.5 -- 11.5 -- 11.5
Continuing operations 35.5 1.9 37.4 -- 37.4
Acquisitions:
CMP Information -- -- -- -- --
Acquisitions -- -- -- -- --
Operating profit before
amortisation of
intangible assets 35.5 1.9 37.4 -- 37.4
Amortisation of
intangible assets (64.4) (1.4) (65.8) -- (65.8)
Operating (loss)/ profit
by division
Continuing operations:
CMP Media (40.0) (0.9) (40.9) -- (40.9)
CMP Asia 0.7 0.2 0.9 -- 0.9
CMP Information (6.6) 0.1 (6.5) -- (6.5)
United Advertising
Publications 6.4 -- 6.4 -- 6.4
Professional media (39.5) (0.6) (40.1) -- (40.1)
News distribution 8.4 1.1 9.5 -- 9.5
Market research 2.2 -- 2.2 -- 2.2
Continuing operations (28.9) 0.5 (28.4) -- (28.4)
Acquisitions:
CMP Information -- -- -- -- --
Acquisitions -- -- -- -- --
Operating loss (28.9) 0.5 (28.4) -- (28.4)
Non-operating
exceptional items (14.0)
Net interest and
other financial income 3.2
Loss on ordinary
activities before tax (39.2)
by geographic market
United Kingdom (0.9) 0.2 (0.7) -- (0.7)
North America (25.1) 0.5 (24.6) -- (24.6)
Europe and Middle East (1.6) (0.4) (2.0) -- (2.0)
Pacific (1.3) 0.2 (1.1) -- (1.1)
Operating loss (28.9) 0.5 (28.4) -- (28.4)
Non-operating
exceptional items (14.0)
Net interest and
other financial income 3.2
Loss on ordinary
activities before tax (39.2)
Analysis of activities
for the six months ended 30 June 2003
Year ended 31 December 2002
Group
share
of joint Exceptional
Group ventures Subtotal items Total
m pounds m pounds m pounds m pounds m pounds
Operating profit/ (loss)
before amortisation of
intangible assets by division
Continuing operations:
CMP Media (7.3) 0.5 (6.8) (11.3) (18.1)
CMP Asia 13.6 0.1 13.7 (0.7) 13.0
CMP Information 9.9 0.2 10.1 (5.8) 4.3
United Advertising
Publications 12.7 -- 12.7 (0.8) 11.9
Professional media 28.9 0.8 29.7 (18.6) 11.1
News distribution 14.3 3.0 17.3 (4.1) 13.2
Market research 17.9 -- 17.9 (7.3) 10.6
Continuing operations 61.1 3.8 64.9 (30.0) 34.9
Acquisitions:
CMP Information -- -- -- -- --
Acquisitions -- -- -- -- --
Operating profit/ (loss)
before amortisation of
intangible assets 61.1 3.8 64.9 (30.0) 34.9
Amortisation of
intangible assets (133.7) (2.2) (135.9) (114.2) (250.1)
Operating (loss)/ profit by division
Continuing operations:
CMP Media (71.3) (0.7) (72.0) (71.3) (143.3)
CMP Asia (0.5) -- (0.5) (0.7) (1.2)
CMP Information (17.5) 0.2 (17.3) (5.8) (23.1)
United Advertising
Publications 11.7 -- 11.7 (0.8) 10.9
Professional media (77.6) (0.5) (78.1) (78.6) (156.7)
News distribution 8.9 2.1 11.0 (21.3) (10.3)
Market research (3.9) -- (3.9) (44.3) (48.2)
Continuing operations (72.6) 1.6 (71.0) (144.2) (215.2)
Acquisitions:
CMP Information -- -- -- -- --
Acquisitions -- -- -- -- --
Operating loss (72.6) 1.6 (71.0) (144.2) (215.2)
Non-operating
exceptional items (14.0)
Net interest and other
financial income 8.0
Loss on ordinary
activities before tax (221.2)
by geographic market
United Kingdom (27.6) 0.5 (27.1) (24.6) (51.7)
North America (54.5) 1.9 (52.6) (112.4) (165.0)
Europe and Middle East 12.5 (0.8) 11.7 (7.2) 4.5
Pacific (3.0) -- (3.0) -- (3.0)
Operating loss (72.6) 1.6 (71.0) (144.2) (215.2)
Non-operating
exceptional items (14.0)
Net interest and
other financial income 8.0
Loss on ordinary
activities before tax (221.2)
Group balance sheet
at 30 June 2003
30 June 30 June 31 December
2003 2002 2002
m pounds m pounds m pounds
Fixed assets
Intangible assets 385.5 649.2 442.7
Tangible assets 60.7 79.0 67.3
Investments in joint ventures:
- share of gross assets 18.9 19.9 17.2
- share of gross liabilities (7.2) (4.7) (4.4)
11.7 15.2 12.8
Investments in associated undertakings 0.2 0.2 0.2
Other investments 172.1 160.7 169.5
630.2 904.3 692.5
Current assets
Stocks 24.1 23.5 16.6
Debtors 163.7 200.5 163.3
Investments -- 1.9 1.5
Short term liquid funds 521.3 463.1 594.8
Cash at bank and in hand 177.3 272.2 96.7
886.4 961.2 872.9
Creditors: amounts falling
due within one year (604.7) (632.3) (605.9)
Net current assets 281.7 328.9 267.0
Total assets less current liabilities 911.9 1,233.2 959.5
Creditors: amounts falling due
after more than one year
Bank and other loans (327.5) (406.0) (338.5)
Other creditors (8.2) (9.3) (13.3)
Convertible debt (237.1) (258.6) (245.0)
(572.8) (673.9) (596.8)
Provisions for liabilities and charges (70.4) (31.2) (58.5)
Net assets excluding pension liability 268.7 528.1 304.2
Pension liability (90.9) (41.0) (90.9)
Net assets 177.8 487.1 213.3
Capital and reserves
Called up share capital 84.5 96.1 84.5
Share premium account 308.5 308.3 308.5
Merger reserve 31.3 31.3 31.3
Other reserves 167.8 156.2 167.8
Profit and loss account (414.9) (106.5) (380.8)
Shareholders' funds
(including non-equity interests) 177.2 485.4 211.3
Equity minority interests 0.6 1.7 2.0
Capital employed 177.8 487.1 213.3
Equity shareholders' funds 176.6 473.2 210.7
Non-equity shareholders' funds 0.6 12.2 0.6
Shareholder' funds 177.2 485.4 211.3
Group cash flow statement
for the six months ended 30 June 2003
Six months Six months Year ended
ended 30 ended 30 31 December
June 2003 June 2002 2002
m pounds m pounds m pounds
Net cash inflow from operating
activities 30.2 20.2 55.5
Dividends received from joint
ventures and associates 0.4 0.3 0.9
Returns on investment and
servicing of finance 4.9 (1.4) 15.2
Taxation 7.6 14.4 15.3
Capital expenditure and financial
investment (3.2) (15.3) (22.1)
Payments relating to prior year
disposals -- (25.0) (19.0)
Acquisitions and disposals (4.3) -- (1.4)
Equity dividends paid to
shareholders (13.4) (3.4) (13.5)
Net cash inflow/ (outflow) before
use of liquid resources and
financing 22.2 (10.2) 30.9
Management of liquid resources (26.6) 201.2 222.0
Net cash (outflow)/ inflow before
financing (4.4) 191.0 252.9
Financing
Issue of ordinary share capital -- 2.7 2.9
Return of capital to shareholders (0.3) (0.2) (7.4)
Redemption of convertible bond -- (164.0) (164.0)
Decrease in bank loans -- -- (47.8)
Repayment of loan stock (0.7) (18.4) (23.6)
Financing (1.0) (179.9) (239.9)
(Decrease)/ increase in cash in
the period (5.4) 11.1 13.0
Reconciliation of net cash flow
to movement in net cash
(Decrease)/ increase in cash in
the period (5.4) 11.1 13.0
Cash outflow from decrease in
debt and financing 0.7 182.4 235.4
Cash outflow/ (inflow) from
decrease/ (increase) in liquid
resources 26.6 (201.2) (222.0)
Changes in net cash resulting
from cash flows 21.9 (7.7) 26.4
Other non cash movements (0.8) (1.2) (6.2)
Translation difference 4.3 10.0 24.0
Movement in net cash in the period 25.4 1.1 44.2
Opening net cash 93.5 49.3 49.3
Closing net cash 118.9 50.4 93.5
Reconciliation of operating loss
to net cash inflow from operating
activities
Operating loss (11.3) (28.4) (215.2)
Depreciation charges 9.5 12.1 23.2
Amortisation of intangible assets
- group 52.5 64.4 247.9
Share of results of joint ventures (1.0) (0.5) (1.6)
Income from other fixed asset
investments (3.2) (3.4) (10.4)
Other finance expenses (2.7) (1.0) (2.1)
Profit on sale of tangible fixed
assets -- -- 0.4
Payments against provisions (9.8) (7.9) (14.9)
Net increase in working capital:
- payments against restructuring
and other exceptional costs (1.3) (15.4) (20.2)
- other movements in working
capital (2.7) 2.3 16.3
Other non-cash items including
movements on provisions 0.2 (2.0) 32.1
Cash inflow from operating
activities 30.2 20.2 55.5
Statement of group total recognised gains and losses
for the six months ended 30 June 2003
Six months Six months Year ended
ended 30 ended 30 31 December
June 2003 June 2002 2002
m pounds m pounds m pounds
Loss for the financial period (17.5) (50.3) (239.0)
Currency translation differences
on foreign currency investments:
Group (4.9) (19.3) (32.5)
Joint ventures (0.1) (0.1) (0.9)
Actuarial loss recognised in the
pension schemes -- -- (50.6)
Other recognised losses for the
year (5.0) (19.4) (84.0)
Total recognised losses for the
year (22.5) (69.7) (323.0)
Prior year adjustment -
implementation of FRS 17
(see note 1) -- (48.9) (48.9)
Total recognised losses relating
to the period (22.5) (118.6) (371.9)
The historical cost loss for the financial period is not materially
different from the reported loss.
Reconciliation of movements in group shareholders' funds
for the six months ended 30 June 2003
Six months Six months Year ended
ended 30 ended 30 31 December
June 2003 June 2002 2002
m pounds m pounds m pounds
Opening shareholders funds 211.3 611.9 611.9
Prior year adjustment -
implementation of FRS 17
(see note 1) -- (48.9) (48.9)
211.3 563.0 563.0
Loss for the financial period (17.5) (50.3) (239.0)
Equity dividends (11.0) (10.1) (23.6)
Non-equity dividends on 'B'
shares - see below (0.3) (0.3) (0.6)
182.5 502.3 299.8
Other recognised (losses)/ gains
relating to the period (5.0) (19.4) (84.0)
New share capital subscribed -- 2.7 2.9
Return of capital to shareholders (0.3) (0.2) (7.4)
Closing shareholders' funds 177.2 485.4 211.3
At 30 June 2003, the company has 7,546,387 B shares outstanding (30 June
2002: 10,480,642; 31 December 2002: 7,546,387). These arose from the return
of capital to shareholders in April 2001. B shares receive a continuing
dividend linked to LIBOR. The company has indicated that it will periodically
offer to repurchase B shares at 245p per share.
On 27 June 2003, the company repurchased and cancelled 100,000 ordinary
shares at 2.93 pounds per share.
Notes
1. Basis of preparation
The interim report for the six months ended 30 June 2003 has been
prepared on the basis of accounting policies set out in the 2002 Annual
Report and Accounts.
The group adopted FRS 17 "Retirement Benefits" in the 2002 Annual
Report and Accounts. The adoption of the standard represents a change
in accounting policy and the comparative figures have been restated
accordingly. Details of the effect of adopting FRS 17 are given in the
Statement of group total recognised gains and losses.
2. Exceptional items
Six months Six months Year ended
ended 30 ended 30 31 December
June 2003 June 2002 2002
m pounds m pounds m pounds
Charged to operating profits:
Continuing operations
Restructuring costs -- -- (30.0)
Goodwill impairment -- -- (114.2)
Continuing operations -- -- (144.2)
(Charged)/credited to profit
before tax:
Payments relating to prior year
disposals -- (14.0) (14.0)
Total credited to profit on
ordinary activities before tax -- (14.0) (158.2)
Tax on exceptional items -- -- --
Exceptional items in 2002 included additional provisions for vacant
properties, goodwill impairment and settlement of an outstanding legal claim
relating to the planned merger with Carlton Communications plc in 2000 and
the subsequent sale of the group's television businesses.
3. Share of operating profit in joint ventures and associates
Six months Six months Year ended
ended 30 ended 30 31 December
June 2003 June 2002 2002
m pounds m pounds m pounds
Joint ventures and associates
-continuing 1.8 1.9 3.8
Amortisation of intangible assets (0.8) (1.4) (2.2)
1.0 0.5 1.6
4. Net interest income/ (expense)
Six months Six months Year ended
ended 30 ended 30 31 December
June 2003 June 2002 2002
m pounds m pounds m pounds
Group 6.2 4.3 10.1
Joint ventures and associates -- -- --
6.2 4.3 10.1
Interest receivable includes 4.5 million pounds (six months ended 30 June
2002: 4.3 million pounds; year ended 31 December 2002: 8.8 million pounds) of
interest receivable from Channel 5 Television Group in respect of shareholder
loans.
5. Earnings/(loss) per share
Six months ended Six months ended Year ended
30 June 2003 30 June 2002 31 December
2002
Earnings/ Earnings/ Earnings/ Earnings/ Earnings/ Earnings/
(loss) (loss) (loss) (loss) (loss) (loss)
m pounds per share m pounds per share m pounds per share
pence pence pence
Profits before
amortisation
of intangible
assets and
exceptional
items 35.8 10.7 29.5 8.9 55.1 16.5
Adjustment in
respect of
amortisation
of intangible
assets (53.3) (16.0) (65.8) (19.8) (135.9) (40.7)
Adjustment in
respect of
exceptional
items:
- charged to
operating
profits -- -- -- -- (144.2) (43.2)
- payments
relating to
prior year
disposals -- -- (14.0) (4.2) (14.0) (4.2)
Basic (17.5) (5.3) (50.3) (15.1) (239.0) (71.6)
Diluted (17.5) (5.3) (50.3) (15.1) (239.0) (71.6)
Basic loss per share is calculated on the loss attributable to
shareholders of 17.5 million pounds (June 2002: loss of 50.3 million pounds;
December 2002: loss of 239.0 million pounds) and on 335,515,353 shares (June
2002: 333,561,961; December 2002: 333,773,282) being the weighted average
number of shares in issue during the period.
For diluted earnings per share, the weighted average number of shares in
issue is adjusted to assume conversion of all dilutive potential ordinary
shares. The group has three categories of dilutive potential ordinary shares:
those share options granted to employees where the exercise price is less than
the average market price of the company's ordinary shares during the year,
those shares which may be issued under the LTIP and shares attributable to
convertible debt. No adjustment has been made for the dilutive impact, as this
would increase reported earnings per share.
6. Foreign exchange
The trading results of overseas subsidiaries, joint ventures and
associated companies were translated into sterling at an average of the
exchange rates ruling for the period. This resulted in a weighted average rate
of exchange in respect of the US dollar for the period of $1.61 : 1 pound
(six months ended 30 June 2002: $1.46 : 1 pound; year ended 31 December 2002:
$1.51 : 1 pound). The balance sheets of overseas subsidiaries, joint ventures
and associated companies were translated into sterling at the period end rate
of exchange in respect of the US dollar of $1.67 : 1 pound (six months ended
30 June 2002: $1.52 : 1 pound; year ended 31 December 2002: $1.61 : 1 pound).
7. Dividends
Six months Six months Year ended
ended 30 ended 30 31 December
June 2003 June 2002 2002
m pounds m pounds m pounds
Equity dividends (11.0) (10.1) (23.6)
Non-equity dividends - B shares (0.3) (0.3) (0.6)
Dividends (11.3) (10.4) (24.2)
An interim dividend of 3.3 pence per ordinary share (2002: 3.0 pence) will
be payable on 23 October 2003 to shareholders on the register at close of
business on 15 August 2003.
The non-equity dividends relate to the LIBOR linked dividend on B shares.
8. Acquisitions and disposals
On 22 April 2003, the 50% shareholding in Property Media Limited not
already owned by the group was acquired for 2.75m pounds in cash.
On 14 May 2003, Kenrick Place Media Limited was acquired for 1.6m pounds
in cash.
9. Post balance sheet events
On 22 July 2003, Aprovia UK was acquired for 79m pounds in cash. Aprovia
UK owns The Builder Group, a UK construction publisher and event organizer,
and Barbour Index, an information services provider to professionals in the UK
construction and health and safety sectors.
10. Status of financial information
The figures for the year ended 31 December 2002 (which do not constitute
statutory accounts within the meaning of Section 240 of the Companies Act
1985) have been extracted from the Annual Report and Accounts which have been
filed with the Registrar of Companies; the auditors opinion on those accounts
was unqualified and did not contain a statement under section 237 of the
Companies Act 1985.
The interim financial information was approved by a duly appointed and
authorised committee of the board of Directors on 29 July 2003. It is
unaudited but has been reviewed by the auditors as set out in their report.
Independent review report to United Business Media plc
Introduction
We have been instructed by the company to review the financial information
for the six months ended 30 June 2003 which comprises a group profit and loss
account, statement of group total recognized gains and losses, group balance
sheet as at 30 June 2003, group cash flow statement, comparative figures and
associated notes. We have read the other information contained in the interim
report and considered whether it contains any apparent misstatements or
material inconsistencies with the financial information.
This report is made solely to the company in accordance with guidance
contained in Bulletin 1999/4 'Review of interim financial information' issued
by the Auditing Practices Board. To the fullest extent permitted by the law,
we do not accept or assume responsibility to anyone other than the company,
for our work, for this report, or for the conclusions we have formed.
Directors' responsibilities
The interim report, including the financial information contained therein,
is the responsibility of, and has been approved by, the directors. The
directors are responsible for preparing the interim report in accordance with
the Listing Rules of the Financial Services Authority which require that the
accounting policies and presentation applied to the interim figures should be
consistent with those applied in preparing the preceding annual accounts
except where any changes, and the reasons for them, are disclosed.
Review work performed
We conducted our review in accordance with guidance contained in Bulletin
1999/4 'Review of interim financial information' issued by the Auditing
Practices Board for use in the United Kingdom. A review consists principally
of making enquiries of group management and applying analytical procedures to
the financial information and underlying financial data, and based thereon,
assessing whether the accounting policies and presentation have been
consistently applied, unless otherwise disclosed. A review excludes audit
procedures such as tests of controls and verification of assets, liabilities
and transactions. It is substantially less in scope than an audit performed
in accordance with United Kingdom Auditing Standards and therefore provides a
lower level of assurance than an audit. Accordingly we do not express an
audit opinion on the financial information.
Review conclusion
On the basis of our review we are not aware of any material modifications
that should be made to the financial information as presented for the six
months ended 30 June 2003.
Ernst & Young LLP
London
29 July 2003
SOURCE United Business Media plc
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Related links:
http://www.unitedbusinessmedia.com
CONTACT:
Michael Waring, +44-20-7921-5031 or Nick
Molden, +44-20-7921-5097, both of United Business Media; or Colin
Browne, The Maitland Consultancy, +44-20-7379-5151
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