TIDMTWE
RNS Number : 3313P
Twenty PLC
30 September 2011
TWENTY PLC
(AIM: TWE)
INTERIM RESULTS
FOR THE SIX MONTHS ENDED 30 JUNE 2011
Twenty plc ('Twenty' or the 'Group'), the AIM quoted integrated
marketing solutions provider, announces its interim results for the
six months ended 30 June 2011.
Enquiries:
Twenty Plc Tel: 07810 640888
Mark Patron, Non-Executive Chairman
www.twentyplc.com
Daniel Stewart & Company plc Tel: 020 7776 6550
Noelle Greenaway
Paul Shackleton
Twenty Plc
Chairman's Statement
Dear Shareholder
Results for the six month period ended 30 June 2011 were
disappointing. Trading continues to be difficult. As explained in
more detail in the Chief Executive's Statement, trading continues
to be difficult across all business units, but in particular the
Home Mover Data business has yet to develop as originally
planned.
During September 2011, the non-executive directors have carried
out a detailed review and examination into the disclosure of the
executive directors' remuneration and payments to their related
parties in the notes to the accounts for the year ended 31 December
2010. This highlighted that there were some errors made in the
reporting of the directors' remuneration note and related party
transactions note. Further details are set out in note 7 to these
Interim Statements.
The Board continues to explore a number of strategic options for
the company and hopes to conclude this review before the end of the
year.
I would also like to re-iterate my thanks to our shareholders
for their tremendous support and patience throughout this difficult
period.
Mark Patron
Non-Executive Chairman
30 September 2011
Twenty Plc
Chief Executive's Statement
Introduction
We have now bedded down our new integrated Database, Data and
Digital business under the TwentyCI brand. We continue to serve our
existing client base within the Database and Digital markets whilst
in parallel continuing the investment in sales and marketing
activity to build a new market position in the Home Mover Data
business through our Moveme subsidiary.
The housing market continues to be depressed resulting in a
slower rate of growth in the new data products being created within
Moveme than we had expected. We have consequently reduced our
overheads in the period further to match the rate of new business
activity that we are experiencing. We believe when the market picks
up we will be well placed to benefit with a unique set of data
products for brands that wish to connect with new home movers.
Our existing clients within the established Database and Digital
businesses continue to spend money with us at a consistent level
which is encouraging and a mark of the quality of our solutions and
staff.
Financials
The interim results for Twenty Plc reflect the six-month period
to 30 June 2011. The results have been prepared in accordance with
International Financial Reporting Standards (IFRS) and
International Accounting Standards (IAS).
During the 6 month period to 30 June 2011 the group reports a
loss after tax of GBP597.8k and loss per share of 1.05p. This
reflects an improvement on the performance of the underlying
business compared to same period last year.
Trading in the period has continued to be difficult with
revenues in Analytical CRM & Data Services declining compared
to the same period last year. This is largely as a result of lost
clients due to the economic downturn not being replaced. In
addition, the Data Sales business, under the Moveme.com brand has
continued to fall below the boards expectations, despite extending
the contract with Royal Mail to resell re-directional data to the
utilities and insurance sector. In response to the reduction in
revenues, the board has continued to rationalise the cost base
during the period, reflecting almost GBP1.0m reduction in
administration costs compared to the same period in 2010. Adjusted
loss per share for the period was 1.05p compared to adjusted loss
per share for the same period last year of 2.99p
During the period the deferred consideration due on the sale of
DF Property Portfolio Limited was renegotiated from GBP2.95m down
to GBP1.5m, to be paid in the period to December 2012. As at the
balance sheet date, GBP0.471m had been paid.
The group had net cash outflow in the period of GBP0.24m
resulting in a cash balance at the balance sheet date of GBP0.5m.
Net current assets at the balance sheet date were GBP0.31m.
Outlook
Trading conditions continue to remain challenging due to the
subdued economic environment and slower than expected growth in the
Twenty Data business. The board continues to explore a number of
strategic options and expect to conclude this review by the end of
the year.
Ian Lancaster
Chief Executive
30 September 2011
Twenty Plc
Group Income Statement (Unaudited)
For the period ended 30 June 2011
6 months 6 months Year
to to to
30.06.2011 30.06.2010 31.12.2010
Unaudited Unaudited Audited
Note GBP GBP GBP
Continuing operations
Revenue 2 1,137,034 1,697,153 3,158,246
Cost of
sales 2 (902,278) (1,214,579) (2,183,253)
----------- ------------ ------------
Gross
Profit 234,756 482,574 974,993
Administrative expenses (832,643) (1,764,173) (2,957,683)
----------- ------------ ------------
Operating Loss
pre-exceptional 2 (597,887) (1,281,599) (1,982,690)
Exceptional item - gain on
acquisition of The Moving
Service Ltd - 152,633 152,633
Exceptional item - goodwill
impairment - - (4,848,200)
Operating Loss 2 (597,887) (1,128,966) (6,678,257)
Finance Income 118 107 282
Finance Costs - (49,527) (64,358)
----------- ------------ ------------
Loss before Taxation (597,769) (1,178,386) (6,742,333)
----------- ------------ ------------
Taxation 3 - - 38,893
Loss for the period from
continuing operations (597,769) (1,178,386) (6,703,440)
=========== ============ ============
Discontinued operations
Profit for the period from
discontinued operations 5 - 1,807,950 359,822
(Loss)/profit for the
period (597,769) 629,564 (6,343,618)
=========== ============ ============
Attributable to:
Equity holders of the
parent (597,769) 629,564 (6,343,618)
----------- ------------ ------------
(597,769) 629,564 (6,343,618)
=========== ============ ============
(Loss)/earnings per share:
Basic and diluted
From continuing operations (1.05 (2.06 (11.75
p) p) p)
From discontinued - 3.17 0.63
operations p p
----------- ------------ ------------
From total operations 6 (1.05 1.10 (11.12
p) p p)
=========== ============ ============
Twenty Plc
Group Statement of Comprehensive Income (Unaudited)
For the period ended 30 June 2011
6 months 6 months Year
to to to
30.06.2011 30.06.2010 31.12.2010
Unaudited Unaudited Audited
GBP GBP GBP
Loss for the period from
continuing operations (597,769) (1,178,386) (6,703,440)
Profit for the period
from discontinued operations - 1,807,950 359,822
Other comprehensive income - - -
----------- ------------ ------------
Total comprehensive (loss)/profit
for the period (597,769) 629,564 (6,343,618)
Attributable
to:
Equity holders
of the parent (597,769) 629,564 (6,343,618)
----------- ------------ ------------
(597,769) 629,564 (6,343,618)
=========== ============ ============
Twenty Plc
Group Statement of Financial Position (Unaudited)
As at 30 June 2011
As at As at As at
30.06.2011 30.06.2010 31.12.2010
Unaudited Unaudited Audited
GBP GBP GBP
Assets
Non-current assets
Property, plant
and equipment 76,369 181,729 129,896
Goodwill - 4,848,200 -
Other debtors 342,857 1,061,500 685,714
Deferred tax - 84,111 -
Total non-current
assets 419,226 6,175,540 815,610
------------ ----------- ------------
Current assets
Trade and other
receivables 1,522,530 2,935,801 1,598,009
Cash and cash equivalents 501,697 1,646,805 743,263
------------
Total current assets 2,024,227 4,582,606 2,341,272
------------ ----------- ------------
Total assets 2,443,453 10,758,146 3,156,882
============ =========== ============
Equity & liabilities
Current liabilities
Trade and other
payables 1,674,319 2,219,603 1,770,367
Obligations under
finance leases 38,249 42,212 40,540
Current tax liabilities - 22,872 -
Total current liabilities 1,712,568 2,284,687 1,810,907
------------ ----------- ------------
Non-current liabilities
Other creditors - 82,711 -
Obligations under
finance leases 2,978 57,174 20,299
Total non-current
liabilities 2,978 139,885 20,299
------------ ----------- ------------
Total liabilities 1,715,546 2,424,572 1,831,206
------------ ----------- ------------
Equity
Share capital 4,835,793 4,836,268 4,835,793
Share premium account 4,151,956 4,151,956 4,151,956
Capital redemption
reserve 475 - 475
Share options reserve 70,753 89,547 70,753
Retained earnings (8,331,070) (744,197) (7,733,301)
Total equity 727,907 8,333,574 1,325,676
------------ ----------- ------------
Total equity & liabilities 2,443,453 10,758,146 3,156,882
============ =========== ============
Twenty Plc
Group Statement of Cash Flows (Unaudited)
For the period ended 30 June 2011
6 months ended 6 months ended Year ended
30.6.2011 30.6.2010 31.12.2010
Unaudited Unaudited Audited
GBP GBP GBP GBP GBP GBP
Cash flow from
operating activities
(Loss)/profit
for the period (597,769) 629,564 (6,343,618)
Adjustments
for:
Finance income (118) (107) (282)
Finance
costs - 49,527 64,358
Taxation - 105,883 66,990
Depreciation
of property,
plant and equipment 67,981 226,617 236,673
Impairment
of goodwill - - 4,848,200
Share-based
payment expense - 10,458 (8,336)
Increase in
contingent
consideration -
Moveme - 42,800 -
Gain on acquisition
of subsidiary - (152,633) (152,633)
Gain on disposal
of subsidiary - (2,181,435) (733,307)
Gain on disposal
of property,
plant and equipment - - 84,132
67,863 (1,898,890) 4,405,795
Operating cash
flows before
movements in
working capital (529,906) (1,269,326) (1,937,823)
(Increase)/decrease
in receivables (53,092) (126,315) 142,262
Decrease
in payables (96,048) (1,696,937) (1,976,510)
(149,140) (1,823,252) (1,834,248)
Cash used
in operations (679,046) (3,092,578) (3,772,071)
Taxation
paid - (95,327) (75,603)
---------- ------------ ------------
Net cash used
in operating
activities (679,046) (3,187,905) (3,847,674)
---------- ------------ ------------
Twenty Plc
Group Statement of Cash Flows (Unaudited)
For the period ended 30 June 2011 (Continued)
6 months ended 6 months ended Year ended
30.6.2011 30.6.2010 31.12.2010
Unaudited Unaudited Audited
GBP GBP GBP GBP GBP GBP
Net cash used
in operating
activities (679,046) (3,187,905) (3,847,674)
Investing
activities
Interest
received 118 107 282
Purchases
of property,
plant and
equipment (14,454) (12,239) (54,594)
Receipts
from sale
of subsidiary
undertakings 471,428 6,310,000 6,180,836
Costs associated
with sale
of subsidiary
undertakings - (394,754) (397,883)
Cash and
cash equivalents
sold with
subsidiary - (116,952) (116,952)
Acquisition
of subsidiary
undertaking - (1) (1)
Cash and
cash equivalents
acquired
with subsidiary
undertaking - 159,300 159,300
Net cash
(used in)/
generated
from investing
activities 457,092 5,945,461 5,770,988
Financing
activities
Interest
paid - (49,527) (64,358)
Repayments
of borrowings - (1,646,739) (1,646,739)
Repayments of
obligations
under finance
leases (19,612) (64,084) (102,631)
Buy back of
shares - - (15,922)
Issue of new
share capital - 175,000 175,000
Net cash
used in financing
activities (19,612) (1,585,350) (1,654,650)
Net
(decrease)/increase
in cash and cash
equivalents (241,566) 1,172,206 268,664
Cash and cash
equivalents
at the beginning
of the period 743,263 474,599 474,599
Cash and cash
equivalents
at the end of
the period 501,697 1,646,805 743,263
========== ============ ============
Twenty Plc
Group Statement of Changes in Equity (Unaudited)
For the period ended 30 June 2011
Share Share Capital Retained
Share options premium redemption earnings/
Capital reserve account reserve (losses) Total
GBP GBP GBP GBP GBP GBP
At 1
January
2010 4,833,860 79,089 3,979,364 - (1,373,761) 7,518,552
Loss for
the
period - - - - (6,343,618) (6,343,618)
Share buy
back (475) - - 475 (15,922) (15,922)
Issue of
new share
capital 2,408 - 172,592 - - 175,000
Share
options - (8,336) - - - (8,336)
--------- ------- --------- ---------- ----------- -----------
At 31
December
2010 4,835,793 70,753 4,151,956 475 (7,733,301) 1,325,676
Loss for
the
period - - - - (597,769) (597,769)
At 30 June
2011 4,835,793 70,753 4,151,956 475 (8,331,070) 727,907
========= ======= ========= ========== =========== ===========
Notes to the Unaudited Interim Financial Statements
For the period ended 30 June 2011
General Information
Twenty Plc is a company incorporated and domiciled in the UK and
is listed on the Alternative Investment Market (AIM). The addresses
of its registered office and principal place of business are
disclosed in the introduction to the annual report.
1 Accounting Policies
a) Basis of preparation
The condensed interim financial statements, which have been
neither audited nor reviewed, have been prepared in accordance with
International Financial Reporting Standards (IFRS's) adopted by the
European Union, IFRIC interpretations and with those parts of the
Companies Act 2006 applicable to companies reporting under IFRS and
comply with International Accounting Standard (IAS) 34 'Interim
Financial Reporting'. They have been prepared on a consistent basis
with the accounting policies set out in the Annual Report and
Accounts for the year ended 31 December 2010 except as set out
below. The preparation of the financial statements requires
management to make estimates and assumptions that affect the
reported amounts of assets and liabilities at the year end and
reported amounts of revenue and expenses during the financial year.
Actual results could differ from the original estimates and
assumptions.
The following standards, interpretations, and amendments to
standards have been adopted in the financial statements for the
first time. None had any impact on the Group results or financial
position:
-- Revised IAS 24 (revised), 'Related party disclosures',
effective 1 January 2011
-- 'Classification of rights issues' (amendment to IAS 32),
effective 1 February 2010
-- IFRIC 19, 'Extinguishing financial liabilities with equity
instruments', effective 1 July 2010
-- 'Prepayments of a minimum funding requirement' (amendments to
IFRIC 14), effective 1 January 2011
-- Improvements to IFRSs (May 2010)
The consolidated financial information has been prepared under
the historical cost convention as modified by the revaluation of
certain financial assets and liabilities.
Going Concern
At the balance sheet date the Group had net current assets of
GBP0.31m. Based on the forecasted performance and cash flows of the
Group for the period to 31 December 2012, which incorporate the
recent cost reductions and the receipt of the remaining deferred
consideration of GBP1.03m over the period to 31 December 2012, the
Directors consider that the Group will be able to meet its
obligations as they fall due in the normal course of business. The
Directors consider that, if necessary, further measures would be
taken to reduce costs further or enter into financing arrangements
as required. For these reasons, the Directors consider it
appropriate to adopt the going concern basis in preparing the
Interim Report.
b) Recently issued standards and interpretations not yet
applied
The following IFRS and IFRIC Interpretations have been issued
but have not been applied by the Group in preparing these financial
statements as they are not as yet effective. The Group intends to
adopt these Standards and Interpretations when they become
effective, rather than adopt them early.
-- IFRS 10, Consolidated Financial Statements - includes a
revised definition of control, which forms the centre of a new
consolidation model. The revised definition states that control
exists when an investor has the right to variable returns and has
the ability to affect those rights through its power over the
investee, effective 1 January 2013
-- IFRS 9, 'Financial instruments', effective 1 January 2013
-- IFRS 12, Disclosure of Interests with Other Entities,
effective 1 January 2013
-- IAS 27 (2011) Separate Financial Statements, effective 1
January 2013
-- IAS 19 (revised), Employee Benefits, effective 1 January
2013.
-- IFRS 13, Fair Value Measurement, effective 1 January 2013
A number of IFRS and IFRIC interpretations are also currently in
issue which are not relevant for the Group's activities and which
have not therefore been adopted in preparing these financial
statements.
Notes to the Unaudited Interim Financial Statements
For the period ended 30 June 2011 (Continued)
c) Publication of non-statutory accounts
The financial information contained in this document is
unaudited and does not constitute statutory accounts within the
meaning of the Companies Act 2006. The information for the year
ended 31 December 2010 is based on the company's
statutory accounts for that year which received an unqualified
audit report and have been filed with the Registrar of
Companies.
d) Basis of consolidation
Subsidiary undertakings are all entities over which the Group
has the power to govern the financial and operating policies of the
subsidiary and therefore exercises control. The existence and
effect of both current voting rights and potential voting rights
that are currently exercisable or convertible are considered when
assessing whether control of an entity is exercised. Subsidiaries
are consolidated from the date at which the Group obtains the
relevant level of control and are de-consolidated from the date at
which control ceases.
The acquisition method is used for all business combinations. On
acquisition, the cost is measured at the aggregate of the fair
values, at the date of exchange, of assets given, liabilities
incurred or assumed and equity instruments issued by the Group in
exchange for control of the acquiree. Any costs directly
attributable to the business combination are expensed as incurred.
The acquiree's identifiable assets, liabilities and contingent
liabilities that meet the conditions for recognition under IFRS 3
(Revised), "Business Combinations" are recognised at their fair
values at the acquisition date.
If the fair value of the cost of acquisition is less than the
fair value of the identifiable net assets of the subsidiary
acquired, the excess is recognised as a gain directly in the income
statement. Where payment of part of the cost of the combination is
contingent on future events, for instance future performance of the
subsidiary acquired, a provision is recognised at the date of
acquisition if it is thought probable that such future events will
be achieved, and the cost of the combination increased accordingly.
The provision is recognised at its fair value, discounted to
recognise the effect of the time value of money where payable in
cash. The discount is released over the period over which the
future events are assessed such that at the date of payment the
provision is equal to the amount of deferred consideration to be
paid. The provision is assessed at each reporting date and adjusted
if expectations of the amount payable have changed. Contingent
consideration payable via the issuance of a variable number of
shares is consider to constitute a liability and is measured at
fair value initially, being the market value of the company's
shares at the date of acquisition. On each subsequent reporting
date the liability is assessed to reflect the change in market
value of the company's shares and the number which are considered
to be likely to be issued. Any changes to contingent consideration
are recognised immediately in comprehensive income.
On an acquisition by acquisition basis, the Group recognises any
non-controlling interest in the acquiree either at fair value or at
the non-controlling interest's proportionate share of the
acquiree's net assets.
The Group treats transactions with non-controlling interests as
transactions with equity owners of the Group. For purchases from
non-controlling interests, the difference between any consideration
paid and the relevant share acquired of the carrying value of net
assets of the subsidiary is recorded in equity. Gains or losses on
disposals to non-controlling interests are also recorded in
equity.
When the Group ceases to have control or significant influence,
any retained interest in the entity is remeasured to its fair
value, with the change in carrying amount recognised in profit or
loss. The fair value is the initial carrying amount for the
purposes of subsequently accounting for the retained interest as an
associate, joint venture or financial asset. In addition, any
amounts previously recognised in other comprehensive income in
respect of that entity are accounted for as if the Group had
directly disposed of the related assets or liabilities. This may
mean that amounts previously recognised in other comprehensive
income are reclassified to profit or loss.
Notes to the Unaudited Interim Financial Statements
For the period ended 30 June 2011 (Continued)
Inter-company transactions, balances and unrealised gains on
transactions between Group companies are eliminated. Unrealised
losses are also eliminated. Accounting policies of subsidiaries
have been changed where necessary to ensure consistency with the
policies adopted by the Group.
d) Segment reporting
In accordance with IFRS 8, segmental information is presented
based on the way in which financial information is reported
internally to the chief operating decision maker. The Group's
internal financial reporting is organised along product and service
lines and therefore segmental information has been presented about
business segments. A business segment is a Group of assets and
operations engaged in providing products and services that are
subject to risks and returns which are different from those of
other business segments.
The Group has determined its reportable segments in accordance
with IFRS 8. In accordance with that Standard the results of
certain operating segments may be aggregated if they are
sufficiently similar in nature. Where a business segment
contributes in excess of either 10% of total revenue, 10% of total
assets or 10% of the absolute amount of reported profit or loss, it
is disclosed as a separate segment. Because the Group has
determined that its reportable segments are based on products and
services, the disclosures specifically required by IFRS 8 in
respect of products and services are not separately disclosed.
Information regarding geographical revenues are disclosed in
note 2 to this interim statement.
e) Discontinued operations
Cash flows and operations that relate to a major component of
the business or subsidiary that has been disposed of or classified
as held for sale are shown separately from continuing operations in
accordance with IFRS 5 "Non-current Assets Held for Sale and
Discontinued Operations". Comparative results for continuing
operations in the income statement and the related notes are
restated to show the results of the disposed businesses as
discontinued operations.
e) Revenue recognition
Revenue comprises the invoiced amounts of services, excluding
VAT, adjusted for amounts invoiced in advance at both the beginning
and end of the year, such that revenue is recognised when the Group
has obtained the right to consideration for the performance of the
services. Revenue on a particular project or service is recognized
in line with the progress of a contract or service. Profit on long
term contracts is taken over the life of the contract when the
outcome of the contract, or a separately identifiable portion of
it, can be assessed with reasonable certainty. More specifically
revenue recognition by operating segment is detailed below :
i) Operational CRM
This segment deals with customer interaction and transactional
marketing activity on behalf of clients. This includes contact
centre, fulfilment and campaign services and was disposed in May
2010 as it formed the Dataforce Interact business.
Clients pay for services based on activity in a month, on a rate
multiplied by volume basis where volume could be hours delivered,
calls answered, items processed.
Income recognition for Operational CRM activity is therefore
based on volume delivered during the period.
ii) Analytical CRM and Data Services
This segment deals with the provision of marketing platform
design, development and support. It is more aligned to software
development and support.
Contracts typically have a setup element (for the design and
build), a licence element (where we provide a third party software
application as part of our solution), a monthly support fee and a
monthly management fee.
The support and management fees are recognised as revenue in the
periods they are earned.
Set up fees are recognised on a percentage of completion
basis.
Licence fees are typically billed annually in advance. Revenue
is recognised equally over the period of the licence. Any
unrecognised revenue at the balance sheet date is held in deferred
income.
iii)E-commerce
This segment relates to the design and support of clients
e-commerce platforms. Revenue recognition follows the same
principles as Analytical CRM and Data Services described above.
Notes to the Unaudited Interim Financial Statements
For the period ended 30 June 2011 (Continued)
iv)Data Sales
This segment relates to the sale of data around home move
trigger date. Data is either sold on a per data item basis or on a
fee per successful sale by the client. Revenue is recognized at the
point the sale is made.
f) Goodwill
Goodwill arising on acquisitions is stated at cost and is not
amortised, but is subject to an annual test for impairment.
Impairment testing is performed by the directors as set out below.
Where an impairment is identified, it is charged to the income
statement in that period.
On the disposal of a subsidiary, the attributable amount of
goodwill is included in the determination of profit or loss on
disposal.
Goodwill has been allocated by subsidiary company, which
reflects the segments reported in accordance with IFRS. These
represent the cash generating units.
Following the consolidation of Twenty Web Limited and
Emaginating Limited into TwentyCi Limited at 31 December 2010,
TwentyCi Limited has become the cash generating unit for the
purposes of testing goodwill.
g) Property, plant and equipment
Property, plant and equipment are stated at historical cost, net
of depreciation and any provision for impairment. Historical cost
includes expenditure that is directly attributable to the
acquisition of the items. Depreciation has been calculated on the
straight line method and aims to write down the cost, less
estimated residual value, of property, plant and equipment over
their expected useful lives, using the following periods:
Leasehold improvements Over the terms of the lease
Plant, machinery and database equipment 4 to 8 years
Fixtures, fittings and office equipment 3 to 10 years
Motor vehicles 4 years
i) Impairment of assets
Assets that have an indefinite useful life are not subject to
amortisation but are instead tested annually for impairment and are
subject to additional impairment testing if events or changes in
circumstances indicate that the carrying amount of the asset may
not be recoverable.
Assets that are subject to depreciation or amortisation are
reviewed for impairment whenever events or changes in circumstances
indicate that the carrying amount may not be recoverable. A review
for indicators of impairment is performed annually. An impairment
loss is recognised for the amount by which the asset's carrying
amount exceeds its recoverable amount. The recoverable amount is
the higher of an asset's fair value less costs to sell and value in
use. Any impairment charge is recognised in the income statement in
the year in which it occurs. When an impairment loss, other than an
impairment loss on goodwill, subsequently reverses due to a change
in the original estimate, the carrying amount of the asset is
increased to the revised estimate of its recoverable amount, up to
the carrying amount that would have resulted, net of depreciation,
had no impairment loss been recognised for the asset in prior
years.
h) Research and development
Costs associated with developing or maintaining computer
software programmes are recognised as an expense as incurred. Costs
that are directly associated with the development of identifiable
and unique software products controlled by the Group, and that will
probably generate economic benefits exceeding beyond one year, are
recognised as intangible assets. Costs include the software
development costs.
Computer software development costs recognised as assets are
amortised on a straight line basis over their estimated useful
lives (not exceeding three years) and are included in
administration expenses within the consolidated income
statement.
i) Investments
Investments in subsidiaries, associates and joint ventures, and
other investments are presented in the parent company financial
statements at cost, less any necessary provision or impairment.
Notes to the Unaudited Interim Financial Statements
For the period ended 30 June 2011 (Continued)
l) Taxation
The tax expense for the year represents the total of current
taxation and deferred taxation. The charge in respect of current
taxation is based on the estimated taxable profit for the year.
Taxable profit for the year is based on the profit as shown in the
income statement, as adjusted for items of income or expenditure
which are not deductible or chargeable for tax purposes. The
current tax liability for the year is calculated using tax rates
which have either been enacted or substantially enacted at the
balance sheet date.
Deferred tax is provided in full, using the liability method on
temporary differences arising between the tax base of assets and
liabilities and their carrying values in the financial statements.
The deferred tax is not accounted for if it arises from initial
recognition of an asset or liability in a transaction other than a
business combination that at the time of the transaction affects
neither accounting nor taxable profit or loss. Deferred tax is
determined using tax rates which have been enacted or substantially
enacted at the balance sheet date and are expected to apply when
the related deferred tax asset is realised or the deferred income
tax liability is settled.
Deferred tax assets are recognised to the extent that it is
probable that future taxable profits will be available against
which the temporary differences can be utilised.
Deferred tax is provided on temporary differences arising on
investments in subsidiaries and associates, except where the timing
of the reversal of the temporary difference is controlled by the
Group and it is probable that the temporary difference will not
reverse in the foreseeable future.
k) Share-based payments
The Group issues equity-settled share-based payments to certain
employees in the form of share options. Equity-settled share-based
payments are measured at fair value (excluding the effect of non
market-based vesting conditions) at the date of grant. The fair
value determined at the grant date of the equity settled
share-based payments is expensed on a straight line basis over the
vesting period, based on the Group's estimate of the shares that
will eventually vest and adjusted for the effect of non
market-based vesting conditions.
Fair value is measured using a modified Black-Scholes pricing
model. The expected life used in the model has been adjusted, based
on management's best estimate, for the effects of
non-transferability, exercise restrictions and behavioural
considerations.
l) Leasing
On inception of a lease of an item of property, plant and
equipment, the terms and conditions of the lease are reviewed to
determine the appropriate classification for the lease. Where the
Group bears substantially all the risks and rewards of ownership of
the item, the lease is classified as a finance lease and the item
is capitalised within the appropriate class of property, plant and
equipment at the lower of the fair value of the leased item and the
minimum lease payments. Each lease payment is allocated between the
liability and finance charges so as to obtain a constant rate on
the finance balance outstanding. The outstanding capital element of
the lease payments are included within current and long-term
payables as appropriate; the interest element of the lease payments
is charged to the income statement over the period of the lease so
as to produce a constant periodic rate of interest on the remaining
balance of the liability for each period.
Leases where the risks and rewards of ownership are retained by
the lessor are classified as operating leases. Rentals payable
under operating leases are charged to the income statement on a
straight line basis over the term of the lease, net of any
incentives received from the lessor. The lease term is considered
to be the non-cancellable period of the lease together with any
additional periods for which the Company and Group has the option
to lease the asset, where it is reasonably certain at the inception
of the lease that this option will be exercised.
m) Pensions
The Group operates a defined contribution pension scheme under
which fixed contributions are payable. Pension costs charged to the
income statement represent amounts payable to the scheme during the
year.
n) Financial instruments
Trade and other receivables
Trade and other receivables are stated at their original
invoiced value, less any appropriate allowance for estimated
irrecoverable amounts.
Notes to the Unaudited Interim Financial Statements
For the period ended 30 June 2011 (Continued)
Trade and other payables
Trade payables are recognised initially at fair value and are
subsequently measured at amortised cost using the effective
interest method. As the payment period of trade payables is short
future cash payments are not discounted as the effect is not
material.
Cash and cash equivalents
Cash and cash equivalents comprise cash at bank and in hand and
other short term highly liquid deposits with original maturities of
three months or less. Bank overdrafts are shown within borrowings
in current liabilities on the balance sheet.
Financial liabilities and equity
Financial liabilities and equity instruments issued by the
Company are classified according to the substance of the
contractual arrangements entered into and the definitions of a
financial liability and an equity instrument. An equity instrument
is any contract that evidences a residual interest in the assets of
the Company after deducting all of its liabilities. The accounting
policies adopted for specific financial liabilities and equity
instruments are set out below.
Borrowings
Interest-bearing borrowings are recognised initially at fair
value, net of any transaction costs incurred. Borrowings are
subsequently stated at amortised cost using the effective interest
method with any difference between the proceeds (net of transaction
costs) and the redemption value being recognised over the period of
the borrowings.
Borrowing costs incurred which are directly attributable to the
acquisition, construction or production of a qualifying asset are
capitalised as part of the cost of that asset.
All borrowings are classified as current unless the Group has an
unconditional right to defer payment of the borrowings until at
least twelve months from the balance sheet date.
Share Capital
Ordinary shares of the company are classified as equity. Shares
in the company which are held in treasury are shown as a deduction
from shareholders' funds.
Equity instruments
Equity instruments issued by the Company are recorded at the
proceeds received, net of direct issue costs.
o) Provisions
Provisions are recognised in the balance sheet where there is a
legal or constructive obligation to transfer economic benefits as a
result of a past event. Provisions are discounted using a rate
which reflects the effect of the time value of money and the risks
specific to the obligation, where the effect of discounting is
material.
Notes to the Unaudited Interim Financial Statements
For the period ended 30 June 2011 (Continued)
2 Segmental analysis
As described in note 1, the Directors consider that
the Group's internal financial reporting is organised
along product and service lines and therefore segmental
information has been presented about business segments.
The segmental analysis of the Group's business was
derived from its principal activities as set out
below. The information below also comprises the disclosures
required by IFRS 8 in respect of products and services
as the Directors consider that the products and services
sold by the disclosed segments are essentially similar
and therefore no additional disclosure in respect
of products and services is required.
No single customer represents more than 10% of the
total Group revenues.
Analytical 6 months
CRM & Data Data ended
Services e-commerce Sales 30.6.2011
GBP GBP GBP GBP
Revenue 758,654 270,786 107,594 1,137,034
Cost of sales (480,314) (189,372) (232,592) (902,278)
---------- ---------- ----------- -----------
Gross Profit/(Loss) 278,340 81,414 (124,998) 234,756
Administrative
expenses (341,393) (170,696) (170,696) (682,785)
---------- ---------- ----------- -----------
Segment result (63,053) (89,282) (295,694) (448,029)
Unallocated
corporate
expenses (149,858)
Operating loss (597,887)
Finance Income 118
Finance Costs -
-----------
Loss before
Taxation (597,769)
Taxation -
-----------
Loss for the
period (597,769)
===========
Notes to the Unaudited Interim Financial Statements
For the period ended 30 June 2011 (Continued)
Analytical 6 months
CRM & Data Data ended
Services e-commerce Sales 30.6.2010
GBP GBP GBP GBP
Revenue 1,175,735 239,695 281,723 1,697,153
Cost of sales (555,888) (212,504) (387,435) (1,155,827)
---------- ---------- ----------- -----------
Gross Profit/(Loss) 619,847 27,191 (105,712) 541,326
Administrative
expenses (684,419) (30,959) (346,792) (1,062,170)
---------- ---------- ----------- -----------
Segment result
before allocated
corporate costs (64,572) (3,768) (452,504) (520,844)
Allocated corporate
expenses (120,961) (24,660) (28,984) (174,605)
Segment result
after allocated
corporate costs (185,533) (28,428) (481,488) (695,449)
Unallocated
corporate
expenses (586,150)
Gain on acquisition
of The Moving
Service Limited 152,633
Operating loss (1,128,966)
Finance Income 107
Finance Costs (49,527)
-----------
Loss before
Taxation (1,178,386)
Taxation -
-----------
Loss for the
period (1,178,386)
===========
In accordance with IFRS 8, segmented information
is presented based on the way in which financial
information is reported internally to the chief operating
decision maker. The Group has determined its reportable
segments in accordance with IFRS 8.
Analytical CRM
Provision of marketing platform design, development
and support and customer data analytical services.
e-commerce
Design, development and support of
client's e-commerce platforms.
Data Sales
The collection and sale of data relating to home
move services.
Administrative expenses are allocated to segments
where they are directly attributable. Following the
significant changes in the business and reductions
in corporate expenses, no allocations of corporate
expenses have been made to the reportable segments
in the period ended 30 June 2011. All revenue and
profit has been generated solely within the United
Kingdom.
All revenue and profit has been generated
solely within the United Kingdom.
The group reports assets and liabilities internally
on a statutory entity basis and therefore has not
reported on assets and liabilities by segment.
3 Taxation
The taxation charge has been estimated by the group
based on previous taxation adjustments and future
rates.
4 Dividends
The directors do not recommend
the payment of an interim
dividend.
Notes to the Unaudited Interim Financial Statements
For the period ended 30 June 2011 (Continued)
Discontinued
5 operations
6 months 6 months
to to Year to
30.06.2011 30.06.2010 31.12.2010
Unaudited Unaudited Audited
GBP GBP GBP
Revenue - 2,542,348 2,542,348
Cost of sales - (1,270,501) (1,270,501)
---------- ----------- -----------
Gross Profit - 1,271,847 1,271,847
Administration
expenses - (894,456) (894,455)
Administration
expenses
associated with
the sale of
subsidiary
undertakings - (644,994) (644,994)
---------- ----------- -----------
Loss before
tax - (267,603) (267,602)
Taxation - (105,883) (105,883)
Loss after taxation
from discontinued
operations - (373,486) (373,485)
========== =========== ===========
Pre-tax gain
recognised on the
sale of
discontinued
operations - 2,181,435 733,307
Taxation - - -
---------- ----------- -----------
After tax gain on
the sale of
discontinued
operations - 2,181,435 733,307
Profit for the
period from
discontinued
operations - 1,807,950 359,822
========== =========== ===========
6 months
to Year to
30.06.2010 31.12.2010
Unaudited Audited
Cash flows from
discontinued
operations GBP GBP
Cash generated from
operations 44,374 44,375
Administration
expenses
associated with
the sale of
subsidiary
undertakings (644,994) (644,994)
Taxation paid (95,326) (95,326)
----------- -----------
Net cash used in
operating
activities (695,946) (695,945)
Net cash used in
investing
activities (10,031) (10,031)
Net cash used in
financing
activities (54,515) (43,252)
Decrease in cash
and cash
equivalents (760,492) (749,228)
=========== ===========
Notes to the Unaudited Interim Financial Statements
For the period ended 30 June 2011 (Continued)
Earnings per
6 share
The calculation of the basic and diluted earnings per
share attributable to the ordinary equity holders of
the company is based on the following data:
6 months 6 months
to to Year to
30.06.2011 30.06.2010 31.12.2010
Unaudited Unaudited Audited
GBP GBP GBP
Earnings
(Loss)/earnings
from total
operations for the
purposes of basic
earnings per
share (597,769) 629,564 (6,343,618)
Goodwill impairment - - 4,848,200
Gain on acquisition
of The Moving
Service Ltd - (152,633) (152,633)
Profit on sale of
subsidiary - (2,181,435) (733,307)
Write off obsolete
assets - - 84,132
Earnings from total
operations for the
purposes of
adjusted earnings
per share (basic &
diluted) (597,769) (1,704,504) (2,297,226)
========== =========== ===========
6 months 6 months
to to Year to
30.06.2011 30.06.2010 31.12.2010
Unaudited Unaudited Audited
No. No. No.
Number of shares
Weighted average
number of ordinary
shares 57,003,968 57,066,485 57,067,504
Basic and diluted (loss)/earnings
per Share (in pence) (1.05) 1.10 (11.12)
========== =========== ===========
Adjusted Earnings per share
(basic & diluted) (in pence) (1.05) (2.99) (4.03)
No potential ordinary shares were considered to be
issuable as the exercise price of shares options
and warrants was above the average share price during
the period.
7 Amendment to director's remuneration note and related party
transactions note
During September 2011, the non-executive directors have carried
out a detailed review and examination into the disclosure of the
executive directors' remuneration and payments to their related
parties in the notes to the accounts for the year ended 31 December
2010. This highlighted that there were some errors made in the
reporting of the directors remuneration note and related party
transactions note. As a result the following changes would be made
to the original notes and will be reflected in the comparatives in
the 2011 financial statements:
Ian Lancaster was awarded a total bonus of GBP182,057, based on
the successful disposal of DF Property Portfolio Limited, which was
all ultimately paid to a company where Ian Lancaster holds an
interest. The non-executive directors duly approved the amount of
this bonus. However, they were not previously aware of these
payment arrangements and it is these payment arrangements, which
led the non-executive directors to re-examine the reporting of
executive directors' remuneration and the related party
transactions note in the accounts for the year ended 31 December
2010.
In the 31 December 2010 accounts, the GBP182,057 bonus was
omitted from the directors' remuneration note, but GBP32,057 was
included within the payments of GBP60,172 shown in the related
party transactions note. There was a further amount of GBP9,715
which was included in the GBP60,172 shown in the related party
transactions note which Ian Lancaster has indicated his willingness
to repay to the company. The GBP182,057 has now been reported under
the directors' remuneration note.
Pending further advice on the matter, there might be a potential
liability to HMRC for PAYE and employers' national insurance. No
provision has been included either in the 31 December 2010 accounts
or the interim accounts for the half year ended 30 June 2011. Ian
Lancaster has indicated his willingness to refund to the Company
any sums paid by the Company in the event a liability subsequently
arises for PAYE relating to this bonus.
Grant Newton was awarded a total bonus of GBP91,085 on the
successful disposal of DF Property Portfolio Limited. In addition,
the Chairman and Chief Executive approved a further discretionary
bonus payment to Grant Newton of GBP25,000. This sum was paid to a
related party as part of the GBP30,000 payment reflected in the
related party transactions note. Included in the GBP30,000 paid to
the related party was GBP3,200 which Grant Newton has indicated his
willingness to refund to the company.
In the 31 December 2010 accounts, only GBP60,000 of the
GBP91,085 bonus was included under the directors' remuneration note
for Grant Newton. The balance of GBP31,085, plus the further bonus
of GBP25,000 has now been corrected and reported under the
director's remuneration note. Grant Newton has indicated his
willingness to have the further discretionary bonus payment of
GBP25,000 retrospectively adjusted though the PAYE system and to
reimburse the Company for the related income tax.
The revised disclosures for the directors' remuneration note and
related party transactions note are shown below:
5 Staff and directors' costs 2010 2009
GBP GBP
Staff costs during the year
Wages and salaries 3,690,004 6,513,262
Social security costs 315,787 486,181
Pension costs 16,832 25,971
------------------------------------------- ------------- -------------
4,022,623 7,025,414
------------------------------------------- ------------- -------------
2010 2009
No. No.
Average number of persons employed
Administration 28 108
Production and sales 79 201
------------------------------------------- ------------- -------------
107 309
------------------------------------------- ------------- -------------
2010 2009
GBP GBP
Remuneration in respect of directors
was as follows
Aggregate emoluments 681,760 355,324
Company contributions to money purchase
pension schemes - 2,567
------------------------------------------- ------------- -------------
681,760 357,891
------------------------------------------- ------------- -------------
The number of directors for whom retirement benefits
are accruing under money purchase pension schemes
for qualifying services during the year was nil
(2009 : 1)
Remuneration for each director
Ian Lancaster 394,727 170,473
Grant Newton 243,700 119,082
Mark Patron 20,000 20,000
Rob Unsworth 18,333 -
Martin Clarke 5,000 48,336
------------------------------------------- ------------- -------------
Total 681,760 357,891
------------------------------------------- ------------- -------------
The amounts above include amounts paid to directors
via related parties totalling GBP182,057 in respect
of Ian Lancaster and GBP25,000 in respect of Grant
Newton. The transactions are detailed in Note 26
to these accounts.
The amounts above include remuneration
in respect of the highest paid director
as follows:
2010 2009
GBP GBP
Aggregate emoluments including benefits
in kind 394,727 170,473
Company contributions to money purchase
pension schemes - -
------------------------------------------- ------------- -------------
394,727 170,473
------------------------------------------- ------------- -------------
Share options for each director
2010 2009
Ian Lancaster 2,658,856 2,202,824
Grant Newton 1,282,091 826,059
Total 3,940,947 3,028,883
------------------------------------------- ------------- -------------
The staff and directors' costs included above reflect
both the continuing and discontinued activities
of the Group during the current and previous year.
26 Related party transactions
On 16 February 2009 the Company issued 6,800,000
ordinary 0.1p shares for GBP85,000 to the vendors
of Emaginating Limited in settlement of the
deferred consideration following the acquisition
by Twenty Plc in December 2006. Of the new shares
issued, 3,400,000 were issued to Professor Martin
Clarke who was a non-executive director of Twenty
Plc during the period.
The inter-group balances between Twenty Plc
company and its subsidiary undertakings are
as follows:
2010 2009
GBP GBP
Owed to TwentyCi Limited
(formerly Dataforce Online
Limited) - (115,908)
Owed to TwentyWeb Limited
(formerly Ominor Limited) - (34,000)
Owed to TwentyCi Holdings
Limited (formerly Dataforce
Holdings Limited) - (10,826,392)
Owed to The Moving Service
Limited 164,879 -
Owed to Emaginating Limited - (2,620)
The amount due to Dataforce Holdings Limited
related to the sale of Dataforce Group Limited
to Twenty Plc during 2006. This balance was
released during the year.
On 31 July 2009 the Group completed a corporate
restructure which resulted in the trade of DF
Property Portfolio Limited (formerly Dataforce
Group Limited) being separated into 3 new operating
companies; Dataforce Interact Limited (a wholly
owned subsidiary of DF Property Portfolio Limited),
TwentyCi Limited (formerly Dataforce Online
Limited) and TwentyCi Central Services Limited
(formerly Dataforce Central Services Limited)
(both wholly owned subsidiaries of Twenty Plc).
On 18 November 2010 TwentyCi Limited acquired
the entire share capital of TwentyWeb Limited
(formerly Ominor Limited), TwentyCi Central
Services Limited and Emaginating Limited from
Twenty Plc.
On 31 December 2010 the Group completed a further
corporate restructure which resulted in the
trade of TwentyWeb Limited, TwentyCi Central
Services Limited and Emaginating Limited being
transferred into TwentyCi Limited.
During the year the following amounts owed to
the company or owed by the company from subsidiaries
were written off
2010
GBP
Owed from TwentyCi Limited
(formerly Dataforce Online
Limited) 1,954,090
Owed to TwentyCi Holdings
Limited (formerly Dataforce
Holdings Limited) 11,007,903
Twenty Plc
During the year, non-executive fees were paid
to Martin Clarke, a director of the company,
GBP5,000, Patron Direct Limited (a company owned
by Mark Patron, a director of the company) GBP
15,000 and Vincos Limited (a company that employs
Rob Unsworth, a director of the company) GBP10,000.
At the year-end GBP5,875 was owed to Vincos
Limited.
During the year GBP60,172 was paid directly
to Valeplan Developments Limited, a company
in which Ian Lancaster holds an interest, partly
in respect of consultancy services relating
to the sale of DF Property Portfolio Limited
and integration services relating to the acquisition
of The Moving Service Limited. GBP150,000 was
paid indirectly to Valeplan Developments via
a third party. Of these amounts GBP182,057 related
to a bonus received by Ian Lancaster following
the successful disposal of DF Property Portfolio
in the year. The GBP182,057 is included in the
directors remuneration disclosed in note 5 to
these accounts.
TwentyCi Limited
During the year GBP30,000 was paid to Sarah
Newton, wife of Grant Newton, a director of
the company, partly for IT consultancy and IT
training services. Of this amount, GBP25,000
related to a bonus to Grant Newton which is
included in the directors remuneration disclosed
in note 5 to these accounts.
During the year GBP823 was paid to Red Eye International
Limited, a company in which Mark Patron holds
an interest, for email services. At the year-end
GBP137 was owed to Red Eye International Limited.
At the year-end GBP2,500 was owed to Martin
Clarke.
Emaginating Limited
During the year, GBP8,500 was paid to Martin
Clarke for consultancy services relating to
client projects for Emaginating.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR BXGDCXSXBGBG
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