TIDMILX
RNS Number : 0061G
ILX Group PLC
25 June 2012
ILX Group PLC
("ILX" or the "Group")
PRELIMINARY RESULTS FOR THE YEAR ENDED 31 MARCH 2012
ILX Group plc (AiM: ILX), the AIM quoted provider of e-learning
software and consulting services, announces its unaudited
preliminary results for the year ended 31 March 2012.
Corporate Highlights
-- Continued strong growth in Australian revenues
-- Software sales growth in the UK despite difficult market conditions
-- Global consultancy business developed
-- Leading position in PRINCE2 and Best Practice digital learning maintained
-- Subsidiaries established in New Zealand, Dubai, and Poland
Financial Highlights
-- Revenues up 5% to GBP13.47 million (2011: GBP12.89 million)
-- Software revenues up 17% and comprise over 57% of Group revenues (2011: 51%)
-- Operating profit GBP1.01 million (2011: GBP1.73 million)
-- Adjusted PBT GBP0.96 million (2011: GBP1.54 million)
-- Adjusted earnings per share 2.49p (2011: 4.39p)
-- Bank debt refinanced with HSBC at reduced rates
-- GBP0.49 million investment in our digital learning products (2011: GBP0.48 million)
-- Net debt GBP2.25 million (2011: GBP1.89 million)
-- Dividend suspended to allow net debt to be reduced
Ken Scott, Chief Executive, ILX Group commented:
"The ongoing economic uncertainty made this a challenging year,
particularly in the UK. However, we have increased Group revenues
and continue to see growth of our digital learning revenues, even
in the UK.
Our digital learning solutions and our technology platform
provide a highly efficient and effective proposition. They deliver
an enjoyable user learning experience and enable both
organisational customers and consumers to obtain accreditation at
excellent value for money. Demand for project and programme
management skills and knowledge remains high, even in the current
climate, and is expected to increase. ILX offer a cost effective,
high quality interactive digital learning solution that meets this
growing need. "
25 June 2012
For further information, please contact:
ILX Group plc 020 7751 7100
Ken Scott, Chief Executive
FinnCap 020 7220 0500
Marc Young, Charlotte Stranner - Corporate
Finance
Victoria Bates - Corporate Broking
Lothbury Financial Services Limited 020 7868 2010
Michael Padley / Chris Roberts
Editors' Note
ILX Group plc (www.ilxgroup.com) is a leading provider of Best
Practice learning products and services to the private and public
sectors. ILX offers a variety of accredited technology led courses
through a blend of traditional classroom, workshops & live
forums and digital learning. It has developed its own proprietary
software and is the market leader in PRINCE2. It trades through two
divisions:
1. UK Best Practice services primarily the UK marketplace,
including a number of multinational companies headquartered in the
UK
2. International was formed in late 2009 to service to overseas
markets, including Australia, New Zealand, Middle East, US and
across Europe.
ENDS
Chairman's Statement
For the year ended 31 March 2012
I am pleased to present the results for the year ended 31 March
2012.
In the current economic climate, the need for project and
programme management skills is as strong as ever. With the
increasing pace of technological change the demand for learning
that can be delivered economically, efficiently, and using
technology, remains strong and is increasing. Thus I am pleased to
report that the Group continued to grow its overall sales during
the period as well as increase the proportion in those sales of
digital learning products.
Nevertheless, the growth was not as strong as we had hoped and
this resulted in the issue of a profits downgrade towards the end
of the financial year. Neither our International division, which
grew revenues 61%, nor our UK division, where revenues fell 15%,
made their annual targets. The UK was affected by highly
competitive market conditions which affected in particular the
classroom sales, and the International sales did not see the growth
in Europe that was expected.
However, the Group still delivered top line growth and a
significant operating profit. The decline in the UK revenues that
was experienced during the year, most particularly in the third
quarter, halted in Q4 which saw slight growth over the same period
the previous year. The Australian and New Zealand operations again
almost doubled their sales, and a strong foundation has been laid
in the Middle East with a number of significant consultancy
contracts in the pipeline for the current financial year.
We are confident that the strategy to focus on software led
solutions and developing our business in overseas markets, whilst
continuing to offer both software and classroom-based learning to
customers, remains the right one.
Dividend
Given the fall in profits for the year, and the resultant effect
on available cash, the Board has taken the decision not to
recommend payment of a dividend for the year ended 31 March
2012.
The Group commenced a dividend payout in 2006 and since that
time has paid dividends totaling GBP1.15 million, of which GBP0.97
million has been in cash and the remainder in scrip shares.
However, it is important in the short term that the Group can
reduce its level of debt and also that it can invest adequately in
the opportunities for growth in its core markets. The position will
be reviewed on a regular basis and the Board will endeavour to
return to paying a dividend as soon as it is prudent to do so.
Financial results
Revenue for the year was GBP13.47 million (2011: GBP12.89
million), an increase of 5%. Operating profit was GBP1.01 million
(2011: GBP1.73 million. Profit before taxation was GBP0.65 million
(2011: GBP1.42 million). Diluted earnings per share were 1.94p
(2011: 4.06p from continuing operations). Net debt increased during
the year to GBP2.25 million (2011: GBP1.89 million).
These results are explained in detail in the Finance Review.
Board changes
Chris Allner of Octopus Ventures was appointed to the Board as a
Non-Executive Director on 30 November 2010. Having left Octopus
Ventures, Chris resigned from the Board and Damien Lane was
appointed on 23 March 2012 in his stead.
I would like to thank Chris for the experience and input he made
during his time on the Board and also warmly welcome Damien to the
Board.
Outlook
We remain in challenging economic times in which companies will
need to innovate to stay ahead. As I said at the beginning of this
report, I believe that we are a company which is able to do so and
that our strategy is the right one. In our ambitions to grow it is
important we do not stretch ourselves too thin and we will
therefore focus principally in the short term on our core
geographical areas of the UK, Australasia, Oman and the UAE.
I would like to thank management and staff for their ongoing
contributions, and our shareholders for their continued support, as
we look forward to continued growth in the current financial
year.
Paul Lever
Chairman 25 June 2012
Business Review
For the year ended 31 March 2012
The year ended 31 March 2012 was very challenging in the face of
the ongoing economic uncertainty. This was especially felt in the
UK but I am pleased that, even domestically, the Group increased
its digital learning revenue. Worldwide, digital learning revenue
increased by 17% and now comprises 57% of total Group revenue. In
addition, and even in this tough year, revenue as an absolute
number grew across the Group.
The ongoing domestic austerity, and the deep shadow of
uncertainty surrounding the Eurozone, has had a marked impact on UK
organisational purchasing patterns. As a consequence, and in the UK
specifically, the Group experienced longer sales lead times, a
slowdown in customer spending and a price war amongst competitors
in the classroom-training arena. At the same time however, and as
mentioned earlier, our domestic sales of digital learning have
grown year on year and the pipeline in the UK remains encouraging.
However, those lengthening sales cycles and commodity pricing
pressure in classroom training gave rise to a shortfall in domestic
revenue and consequent shortfall in Group profitability.
Our ability to develop overseas markets on the back of digital
learning and our market leading position in PRINCE2 (a leading and
established best practice standard in project management) has also
been instrumental in our continued substantial international
growth. We are seeing the benefits of promoting our digital product
suite and this combined with ongoing overseas expansion should
allow the Group to recover its growth trajectory. The foundations
that we have in place should ensure that ILX remains a market
leader in digital learning, worldwide.
Our strategy and vision
The Group's vision is to 'Transform the Way People Learn'. We
are committed to building brand leadership in digital learning to
consumers and organisational customers across the world using
innovative technology to deliver exceptional customer experiences
around the core range of products and services.
Two years ago, we set out four key drivers for strategic
growth:
Focus on innovative product development and customer retention
to build on our position as a global market leader in the PRINCE2
project management qualification
We are at our core a digital learning provider, although we are
also highly active in the provision of classroom training and in
providing blended learning experiences; a mixture of digital and
classroom events. Although we firmly believe that the migration to
digital learning is inexorable and accelerating, we recognise that
individual learners and organisations will migrate at a pace that
suits their particular needs and circumstances. By being available
to individual learners and organisations, regardless of where they
are on the learning delivery spectrum will we believe, secure their
business to ILX for years to come.
Sales of our digital learning products continued to grow as a
proportion of total sales and now account for 57% of our PRINCE2
revenues (2011: 52%). Customer retention metrics, both in terms of
repeat business and renewed software licences, have also shown
improvement year on year.
ILX has over 10% of the PRINCE2 learning market measured by exam
passes. We deliver learning products and services in over 100
countries across 5,000 organisations worldwide. The principal
geographic areas of activity are the UK, Australia, New Zealand,
Scandinavia, Western Europe, UAE, Oman, South Africa and the USA.
During the year we established new subsidiaries in Poland and New
Zealand.
Key enablers for this strategy to be successful are:
- Retaining product focus and innovation around the core product
range. The aim is to achieve market dominance in PRINCE2 and market
leadership in ITIL (a leading and established best practice
standard in IT Service management).
- Ensuring we have a strong field sales capability across the
business that is populated by well-trained and well-managed high
performers who are able to sustain the growth required and thereby
deliver the targeted results. We have recruited a sales coaching
company to help ensure that our UK and international sales
population as well as the supporting processes are fit for
purpose.
- Strengthening the ILX brand and providing effective marketing
support for our field sales activities.
Leverage our proprietary technology to drive significant
international expansion; focusing on PRINCE2 and project management
where we can disrupt established markets.
The Group is building and developing its sales footprint across
new and existing geographic territories. Currently, our field sales
population is based in the UK, Denmark, the Netherlands, Dubai,
Australia and New Zealand. This sales force drives around 70% of
Group revenue. In all our new territories, we use our global
pre-eminence as the leading learning provider in the PRINCE2 market
as the entry point. Once established, we then broaden our offer
over time.
Our total Group revenues by geographic area of delivery are
shown below.
Year ended Year ended
31.3.2012 31.3.2011
GBP'000 % GBP'000 %
UK & Ireland 7,922 58.7% 9,005 69.9%
Australasia 2,502 18.6% 1,191 9.2%
Europe, Middle East
and Africa 2,085 15.5% 1,952 15.2%
Americas 358 2.7% 352 2.7%
Africa 531 3.9% 309 2.4%
Asia 75 0.6% 77 0.6%
-------- --------
13,473 100.0% 12,886 100.0%
======== ========
Over 40% of the Group's sales are now made to overseas
customers, with sales outside the UK growing by 43% during the
year. The major areas of growth were again Australia for the second
year running and New Zealand. Our Australasian operation was
started just two years ago and has gone from a standing start to
now accounting for almost 20% of Group revenue. Substantial sales
in mainland Europe and Scandinavia were also generated; some
through our subsidiary in Copenhagen but the majority directly from
the UK. The UAE and Oman also remain key target areas for growth
and since the close of the year we have established a subsidiary
company in Dubai to service this region.
On the back of our field sales capability, we have also
developed a global consultancy business, to take advantage of the
growing move in a number of countries towards governmental and
organisational compliance with PRINCE2 process management. The
consultancy opportunities typically develop from the sale of
learning content but sometimes can be generated without our
learning material initially having been used. The ILX brand and
reputation are particularly helpful in new territories.
Our consumer offer currently accounts for around 30% of Group
revenue. This revenue is all from web-generated leads, two thirds
of which come through orders and enquiries; the remaining third
being fully automated web purchases. We believe this area has
significant opportunity for scalability.
In both our field sales and our consumer offer, the primary
focus is on English language content as we have found the English
language market for digital learning to be far more extensive than
just English speaking territories. Sufficient numbers of workers
seeking PRINCE2 accreditation in non-English speaking regions
appear to value the English language versions and this is where we
are particularly strong.
Develop our capability in other markets for Finance and Service
Management to build market-leading positions.
Our revenues by subject for the year, with the comparative for
last year, are shown below.
Year ended Year ended
31.3.2012 31.3.2011
Digital Digital
learning Other Total learning Other Total
GBP'000 GBP'000 GBP'000 %age GBP'000 GBP'000 GBP'000 %age
PRINCE2 4,193 3,359 7,552 56.1% 3,886 3,601 7,487 58.1%
ITIL & ISO20000 538 616 1,154 8.6% 632 579 1,211 9.4%
Other OGC Best
Practice 1,030 1,266 2,296 17.0% 787 1,687 2,474 19.2%
Finance 308 - 308 2.3% 342 - 342 2.6%
Software testing 93 - 93 0.7% 72 - 72 0.6%
Microsoft 120 - 120 0.9% 20 - 20 0.2%
Multi-subject
licences 1,340 - 1,340 9.9% 779 - 779 6.0%
Other revenues 52 558 610 4.5% 18 483 501 3.9%
---------- -------- -------- ------- ---------- -------- -------- -------
7,674 5,799 13,473 100.0% 6,536 6,350 12,886 100.0%
57.0% 43.0% 100.0% 50.7% 49.3% 100.0%
At first glance it would appear our revenues from pure PRINCE2
sales grew by just 1% in the year and now account for 56% of our
business (2010: 58%), whereas pure ITIL and ISO20000 revenues
remained flat at 9%. However, we have developed a multi-subject
digital learning offer called Digital Learning Licence, which has
proved very popular. Sales of the Digital Learning Licences
increased by 72% during the year to GBP1.34 million (2011: GBP0.78
million) and the advent of this offer means that some of our
PRINCE2 and ITIL data in particular is hidden in the sales of
multi-subject Digital Learning Licences.
Other OGC (Office of Government Commerce, a division of the UK
Treasury Department) accredited products comprise Programme and
Project Sponsorship, Project Support (P3O), Risk Management
(M_o_R), Value Management (MoV), Managing Successful Programmes
(MSP) and the APM Introductory Certificate in Project Management.
Revenues decreased by 7% and accounted for 17% of the business
(2011: 19%).
Focus on increasing the number of learners using ILX technology
worldwide.
As was stated earlier, we recognise that individual learners and
organisations will migrate to digital learning at a pace that suits
their particular needs and circumstances. However, all our learners
are exposed to our technology, whether through digital learning
courses, access to revision games on hand-held devices, or a
classroom-based simulation. During the year, we provided digital
learning licenses to 56,000 users.
ILX is committed to taking advantage of the growing number of
workers seeking to acquire new business skills. We plan to develop
this into subscription-based revenue from users of our products and
services.
Values and people
Our core values of Passion; Making a Difference; Teamwork and
Ownership have been challenged in the past year in the face of the
Euro monetary crisis, the UK recession and the overall global
uncertainty, which have all impacted on business performance. In
addition to these values we recognise the need for urgency in
everything we do within the business in the knowledge that the
speed of change is highly unpredictable and that the time available
is highly subjective.
The year saw a number of people changes.
The executive management team within the Group has been
strengthened over the past year; primarily to add additional skills
that we need as the business expands. As I announced a year ago,
Mel Scott-Taylor arrived from the Disney Channel in April 2011 to
take up the newly created role of Chief Marketing Officer,
responsible for driving marketing disciplines into a traditionally
sales dominated culture. In April this year, Phil Barr also joined
to take up another newly created role of Chief HR Officer. Phil
came from Yell, where he was responsible for UK HR and key elements
of Yell's global change programme.
At the end of March 2012 and as agreed at the time of his
appointment, Martyn Kinch stepped down as Head of International and
has now retired from the business. Martyn has been with ILX on and
off since we purchased his company, Key Skills, in February 2004.
He has had a major influence on the Group over the years and he
will be missed. I would like to take this opportunity to thank him
for his work and for his companionship over the past eight
years.
Our new head of International is Eddie Kilkelly. Eddie was
appointed to the main board in early 2011 and is highly experienced
in all aspects of our operational and sales functions, having run
the UK business for the past four years. He is well respected
within ILX and is firmly grasping the International baton. I have
taken over direct responsibility for running the UK sales
operation. David Willis, our Chief Technology Officer, and Jon
Pickles, our Chief Financial Officer, complete the team.
The executive management team continues to be committed to the
core values and to ensure those values remain at the heart of our
culture as the company changes shape.
Finally, I would like to thank all our staff for their ongoing
hard work and resolve in what has been a testing year for everyone.
We look to the future with confidence.
Ken Scott
Chief Executive Officer
25 June 2012
Finance Review
For the year ended 31 March 2012
Financial results
Operating performance
The Group delivered revenues of GBP13.47 million (2011: GBP12.89
million), growth of 5%. Gross margins increased fractionally to
55.5% (2011: 55.2%), with the positive effect of an increasing
proportion of software sales offset somewhat by lower margins in
the classroom space due to competitive pressure. Operating profit,
however, fell to GBP1.01 million (2011: GBP1.73 million)
principally as a result of higher overhead costs relating to
marketing and international sales.
The breakdown of revenues and profits is disclosed in the notes
to the accounts in the same format as that used internally, as
required by IFRS 8. The note has also been expanded to include the
two prior years to give a clearer view of the underlying
trends.
These figures highlight that revenue growth for the year was
driven by the International division, which grew its top line by
61% to GBP5.22 million, with the UK division revenues falling 15%
to GBP7.95 million. Both divisions made a substantial contribution
to profit. It should be noted that the UK division bears the entire
costs of the Group's UK premises and operations team. The Finance
e-learning revenues contributed GBP0.31 million (2011: GBP0.34
million), at a significantly increased profit.
Central costs rose to GBP2.39 million (2011: GBP1.89 million).
These relate to technology, IT, finance, and central personnel
costs, together with the costs of the Board, advisors, and other
AIM related expenditure. Also included here are marketing costs,
with the exception of those that relate directly to specific sales
support for the International and UK divisions. The increase in
central costs is principally due to increased marketing spend; in
addition, the prior year comparative figure was distorted downwards
by Directors waiving GBP115,000 of salary and pension in return for
share options.
International subsidiaries
During the year, the Group traded principally through three
companies; ILX Group plc, ILX Group Pty Ltd (Australia) and ILX
Group Aps (Denmark). Subsidiaries have also been established in New
Zealand, the USA, Poland, and post year end, the JLT free zone in
Dubai. These have been required to support our increasing
international business and will assist in ensuring and maintaining
a local presence for customers.
Finance costs
The Group incurred finance costs of GBP0.37 million (2011:
GBP0.31 million) during the year. This cost comprised GBP0.21
million in interest on bank loans and facilities (2011: GBP0.33
million); a credit of GBP0.04 million relating to the Group's
interest rate swap arrangement (2011: GBP0.09 million); and loan
arrangement costs of GBP0.19 million (2011: GBP0.07 million). As
noted in last year's report, these costs included GBP0.18 million
in previously paid fees relating to the Barclays debt which were
being amortised over the term of the loan and were brought forward
when the debt was refinanced during the year, as covered in more
detail below.
Profit before tax
Profit before tax was GBP0.65 million (2011: GBP1.42
million).
In line with common practice, the Group has also presented an
adjusted profit before tax figure which is calculated after adding
back one-off non-cash refinancing charges, share option charges,
and intangibles impairment. Adjusted profit before tax for the year
was GBP0.96 million (2011: GBP1.54 million). Details are included
in the notes to the accounts.
Taxation
The tax charge for the year was GBP0.10 million (2011: GBP0.40
million), representing 16% of profit before tax (2011: 28%). The
Group continues to benefit where possible from tax credits
available in the UK arising from qualifying research and
development.
Profit for the year and Earnings per share
Profit for the year attributable to equity shareholders was
GBP0.55 million (2011: loss of GBP9.45 million, after a loss from
discontinued operations of GBP10.48 million).
Earnings per share were 2.00p (2011: loss of 38.2p, earnings of
4.14p from continuing operations). Diluted earnings per share were
1.94p (2011: loss of 37.4p, earnings of 4.06p from continuing
operations).
An adjusted earnings per share figure is also presented based on
adjusted profit before tax and after applying a standard tax rate.
Adjusted earnings per share were 2.60p (2011: 4.48p) and adjusted
diluted earnings per share 2.49p (2011: 4.39p).
Cash flow
Cash generated from continuing operating activities was GBP1.16
million (2011: GBP1.79 million). This represents 115% of operating
profit (2011: 103% of operating profit). The Group continues to
generate strong operating cash flow from its operating profit with
strong e-commerce and cash sales and an increase in advance
payments from customers, reflected by a 14% increase in deferred
income.
The Group paid out GBP0.34 million in corporation tax (2011:
GBP0.18 million). This significant increase was due to both the
payment of the higher tax bill for the year ended 31 March 2011 and
also the beginning of payment of UK corporation tax by
installments, required as the Group is now considered large for UK
corporation tax purposes.
The Group continued to invest in its product range and also
incurred capital expenditure in the period relating to updates of
systems and equipment.
Refinancing and net debt
The Group refinanced its bank facilities during the period,
moving from Barclays to HSBC to secure additional facilities with
substantially reduced costs.
At the 31 March 2011 the Group had term debt of GBP2.6 million
with Barclays at an average interest rate of 6.9% over LIBOR. By 30
September 2011 this had been reduced to GBP2.1 million, and it was
refinanced with a 3-year term loan of GBP2.0 million at 3.3% over
base rate.
The Group also had at 31 March 2011 a revolving credit facility
of GBP0.95 million, which was due for renewal in October 2011. This
was refinanced by a GBP2.0 million 2-year revolving credit
facility, expiring October 2013.
At the balance sheet date, the Company was in technical breach
of two out of five banking covenants and accordingly, as required
by IAS1, the Company's bank loans are presented as current
liabilities. The Company's bankers have acknowledged the breach and
confirmed that, at the present time, they are not taking any action
following this breach. Of the total GBP2.89 million in facilities
drawn, GBP0.65 million are expected to fall due for payment during
the current year.
The effect of the refinancing was to reduce the overall cost of
facilities by approximately 4 percentage points, almost halving the
interest cost to the Group. In addition, total facilities increased
from GBP3.15 million at 31 March 2011 (including GBP0.4 million
undrawn) to GBP3.84 million at 31 March 2012 (including GBP0.95
million undrawn). Further draw down of these undrawn amounts is
subject to EBITDA not exceeding gross debt by more than 2 times at
the point of draw down and to the covenants being remedied.
As noted above, the refinancing accelerated the amortisation of
GBP139,000 out of GBP180,000 in previously capitalised arrangement
fees. Arrangement fees paid to HSBC were GBP52,000 and these will
be spread over the period of the facilities.
Net debt at the year end, defined as all bank debt, less cash at
bank, was GBP2.25 million (2011: GBP1.89 million). This comprised
GBP2.89 million in bank facilities drawn and GBP0.64 million in
cash balances.
Interest rate and currency risk
The Group entered into an interest rate swap agreement with
Barclays Bank in February 2008, to hedge its exposure to interest
rate movements in respect of its term loan. This agreement expired
during the year. At the balance sheet date, there was no interest
rate hedging in place.
34.3% of the Group's turnover for the year was invoiced in 7
separate foreign currencies (2011: 18.7% in 6 foreign currencies).
These are: Australian Dollars (14.2%), Euros (5.9%), New Zealand
Dollars (5.4%), US Dollars (4.9%), South African Rand (2.0%),
Danish Kroner (1.9%), and Emirati Dirhams. At the year end, GBP1.15
million of assets (2011: GBP0.95 million) and GBP1.00 million of
liabilities (2011: GBP0.42 million) were denominated in these
currencies. No currency hedging arrangements were in place during
the year. The Group maintains currency accounts in all these
currencies, in order to match currency income and expenditure and
to benefit from bulk rates on transfer to sterling.
Dividend
A dividend of 1.50 pence per share was declared for the previous
financial year, which was paid during the year just ended. 43.4% of
the shareholders elected to receive the scrip option, resulting in
the issue of 620,796 new ordinary shares. The remaining GBP232,000
of the dividend was paid in cash during the year. As noted in the
Chairman's statement, the board does not recommend a dividend for
the year just ended.
Jon Pickles
Chief Financial Officer
25 June 2012
Consolidated Statement of Comprehensive Income
For the Year ended 31 March 2012
Year Year
ended ended
31.3.2012 31.3.2011
Unaudited Audited
Notes GBP'000 GBP'000
Revenue 13,473 12,886
Cost of sales (5,999) (5,768)
----------- -----------
Gross profit 7,474 7,118
Administrative and distribution expenses (6,329) (5,303)
----------- -----------
Earnings before interest, tax and
depreciation 1,145 1,815
Depreciation and amortisation (137) (82)
Operating profit 1,008 1,733
Finance income 4 -
Finance costs (365) (311)
----------- -----------
Profit before tax 647 1,422
Tax expense (101) (396)
----------- -----------
Profit for the year from continuing
operations 546 1,026
Loss from discontinued operations 4 - (10,478)
----------- -----------
Profit / (loss) for the year attributable
to equity shareholders 546 (9,452)
Other comprehensive income - -
----------- -----------
Total comprehensive income 546 (9,452)
=========== ===========
Earnings per share 5
From continuing operations:
Basic 2.00p 4.14p
Diluted 1.94p 4.06p
From discontinued operations:
Basic - (42.30p)
Diluted - (41.48p)
Consolidated Statement of Financial Position
As at 31 March 2012
As at 31.3.2012 As at 31.3.2011
Unaudited Audited
Assets GBP'000 GBP'000
Non-current assets
Property, plant and equipment 194 95
Intangible assets 9,804 9,618
Total non-current assets 9,998 9,713
---------------- ----------------
Current assets
Trade and other receivables 3,266 3,009
Cash and cash equivalents 638 1,265
---------------- ----------------
Total current assets 3,904 4,274
Total assets 13,902 13,987
================ ================
Current liabilities
Trade and other payables (3,410) (3,234)
Contingent consideration (28) (35)
Tax liabilities (860) (995)
Bank loans and overdrafts (2,888) (1,350)
---------------- ----------------
Total current liabilities (7,186) (5,614)
---------------- ----------------
Non-current liabilities
Derivative financial instruments - (35)
Contingent consideration (28) (287)
Bank loans - (1,801)
---------------- ----------------
Total non-current liabilities (28) (2,123)
---------------- ----------------
Total liabilities (7,214) (7,737)
================ ================
Net assets 6,688 6,250
================ ================
Equity
Issued share capital 2,759 2,697
Share premium 114 -
Own shares in trust (1,881) (1,852)
Share option reserve 427 317
Retained earnings 5,288 5,116
Exchange differences arising on consolidation (19) (28)
---------------- ----------------
Total equity 6,688 6,250
================ ================
Consolidated Cash Flow Statement
For the year ended 31 March 2012
Year Year
ended ended
31.3.2012 31.3.2011
Unaudited Audited
GBP'000 GBP'000
Profit from continuing operations 1,008 1,733
Adjustments for:
Depreciation and amortisation 137 82
Share option charge 113 118
Movement in trade and other receivables (461) (188)
Movement in trade and other payables 358 71
Exchange differences on consolidation 9 (28)
----------- -----------
Cash generated from continuing operating
activities 1,164 1,788
Tax paid (342) (183)
----------- -----------
Net cash generated from continuing operating
activities 822 1,605
Net cash (used by) / generated from discontinued
operating activities (23) (146)
----------- -----------
Net cash generated from operating activities 799 1,459
----------- -----------
Investing activities
Interest received 4 -
Proceeds on disposal of property and equipment - 1
Purchases of property and equipment (178) (53)
Expenditure on product development (489) (477)
Acquisition of subsidiaries (23) (9)
----------- -----------
Net cash used by investing activities (686) (538)
----------- -----------
Financing activities
(Decrease) / increase in borrowings (263) (373)
Net proceeds of share issue - 842
Outflow relating to capital restructure - (34)
Interest and refinancing costs paid (245) (454)
Dividend paid (232) -
Net cash from financing activities (740) (19)
----------- -----------
Net change in cash and cash equivalents (627) 902
Cash and cash equivalents at start of
year 1,265 363
Cash and cash equivalents at end of year 638 1,265
=========== ===========
Notes to the Preliminary Results
For the year ended 31 March 2012
1 Results
The financial information set out in this unaudited preliminary
announcement does not constitute the statutory financial statements
for the years ended 31 March 2012 or 2011 but is derived from those
accounts. Statutory accounts for 2011 have been delivered to the
registrar of companies, and those for 2012 will be delivered in due
course. The auditors have reported on the accounts for 2011; their
report was (i) unqualified, (ii) did not include a reference to any
matters to which the auditors drew attention by way of emphasis
without qualifying their report and (iii) did not contain a
statement under section 498 of the Companies Act 2006. The auditors
have not yet reported on the accounts for 2012.
2 Accounting policies
The principal accounting policies of the Group are set out in
the Group's 2011 Annual Report and Financial Statements. The
policies have remained unchanged for the year ended 31 March
2012.
3 Segment reporting
In accordance with IFRS 8, the Group now presents its segmental
analysis in terms of its three operating divisions, UK Best
Practice, International Best Practice and Finance e-learning, as
opposed to two segments of Best Practice and Finance. The analysis
of revenue and profit by division is as follows, for the year and
the prior two years, together with a reconciliation of the adjusted
profit before tax figure.
Year ended Year ended Year ended
31.3.2012 31.3.2011 31.3.2010
Revenue Profit Revenue Profit Revenue Profit
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
UK Best Practice Division 7,949 1,945 9,309 2,634 9,565 2,535
International Division 5,216 1,271 3,235 876 1,810 421
Finance e-Learning division 308 184 342 113 493 246
Unallocated central costs - (2,392) - (1,890) - (2,146)
-------- -------- -------- -------- -------- --------
Continuing operations 13,473 1,008 12,886 1,733 11,868 1,056
======== ======== ========
Interest (361) (311) (299)
-------- -------- --------
Profit before Tax from Continuing
Operations 647 1,422 757
Non-cash refinancing charges 139 - -
Share option charges 113 118 101
Impairment charges 60 - -
-------- -------- --------
Adjusted Profit before Tax 959 1,540 858
======== ======== ========
The discontinued operation for the prior year is treated as a
further segment under IFRS 8 and analysis of the results of this
segment is provided in Note 4.
Revenues for the year and prior year split by geographical area
were as follows:
Year ended Year ended
31.3.2012 31.3.2011
Total Continuing Discontinued Total
GBP'000 GBP'000 GBP'000 GBP'000
UK & Ireland 7,922 9,005 816 9,821
Australasia 2,502 1,191 - 1,191
Europe, Middle East
and Africa 2,085 1,952 472 2,424
Americas 358 352 143 495
Africa 531 309 - 309
Asia 75 77 - 77
----------- ----------- ------------- --------
13,473 12,886 1,431 14,317
=========== =========== ============= ========
4 Discontinued Operations
The results of the Corporate Training Group (CTG), which was
closed during the prior year, have been included in the
Consolidated Statement of Comprehensive Income as loss from
discontinued items in accordance with IFRS 5. A breakdown of these
results is as follows:
Year ended Year ended
31.3.2012 31.3.2011
Total Total
GBP'000 GBP'000
Revenue - 1,431
Cost of sales and administrative expenses - (1,653)
------------ -----------
(Loss) / earnings before interest, tax
and depreciation - (222)
Depreciation - (11)
Impairment - (10,351)
------------ -----------
Loss before tax - (10,584)
Tax - 106
------------ -----------
Loss for the year from discontinued operations - (10,478)
============ ===========
5 Earnings per share
Earnings per share is calculated by dividing profit attributable
to shareholders by the weighted average number of shares in issue
during the year.
Diluted earnings per share is adjusted for outstanding share
options and the average option price, using an average interest
saving of 5.0% (2011: 8.0%).
Year ended Year ended
31.3.2012 31.3.2011
GBP'000 GBP'000
Profit / (loss) for the year attributable
to equity shareholders 546 (9,452)
=========== ===========
Weighted average shares 27,260,017 24,768,797
Outstanding share options 1,234,705 492,250
----------- -----------
Weighted average shares for diluted earnings
per share 28,494,722 25,261,047
=========== ===========
Basic earnings / (loss) per share 2.00p (38.16p)
Diluted earnings / (loss) per share 1.94p (37.42p)
Year ended Year ended
31.3.2012 31.3.2011
From continuing operations GBP'000 GBP'000
Profit for the year from continuing operations 546 1,026
Basic earnings per share 2.00p 4.14p
Diluted earnings per share 1.94p 4.06p
Year ended Year ended
31.3.2012 31.3.2011
From discontinued operations GBP'000 GBP'000
Loss from discontinued operations - (10,478)
Basic loss per share - (42.30p)
Diluted loss per share - (41.48p)
Adjusted earnings per share is calculated as follows:
Year ended Year ended
31.3.2012 31.3.2011
GBP'000 GBP'000
Adjusted profit before tax 959 1,540
less notional tax at 26% (28%) (249) (431)
----------- -----------
Adjusted profit before tax 710 1,109
Adjusted earnings per share 2.60p 4.48p
Adjusted diluted earnings per share 2.49p 4.39p
6 Dividend
The directors do not recommend payment of a dividend for the
year.
7 Annual report
The annual report will be sent to shareholders in due course and
will also be available from the Company's website www.ilxgroup.com
and from the Company's registered office at 1 London Wall, London
EC2Y 5AB.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR BKBDQPBKDAAB
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