Earnings Release • Nov 22, 2016
Earnings Release
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National Storage Mechanism | Additional information
RNS Number : 7631P
Jaywing PLC
22 November 2016
Date: 21st November 2016
On behalf of: Jaywing plc ("Jaywing", "the Company" or "the Group")
Embargoed: 0700 hrs 22nd November 2016
Jaywing plc
Interim Results 2016/2017
Jaywing plc (AIM: JWNG) today announces its interim results for the six months ended
30 September 2016.
Financial highlights from continuing operations
| Period to 30 September 2016 £'000 |
Period to 30 September 2015 £'000 |
|
| Gross profit* | 17,114 | 15,447 |
| Adjusted EBITDA** | 2,132 | 1,807 |
| Adjusted EBITDA margin*** | 12.5% | 11.7% |
| Adjusted operating profit# | 758 | 503 |
| Basic EPS on adjusted EBITDA | 1.66p | 1.46p |
| (Loss) / profit after tax | (384) | 21 |
| Reported EPS | (0.45)p | 0.03p |
| Net debt | 3,398 | 6,389 |
* Revenue less direct costs of sale
** Before amortisation, share based charges, exceptional items and acquisition related costs
*** As a percentage of gross profit
# Before acquisition related costs
Highlights:
· Gross profit growth of 11% (7% excluding acquisitions)
· Adjusted EBITDA growth of 18% (12% excluding acquisitions)
· 0.8% improvement in EBITDA margin
· Increased operating profit excluding the one-off impact of acquisition related costs
· Reduction in net debt
Outlook:
· Trading in line with full year market expectations
Commenting on the results, Ian Robinson, Chairman of Jaywing plc, said:
"The first half of the financial year has seen Jaywing continue make excellent progress in its growth strategy. EBITDA was up 12% organically and up by 18% after including the impact of two recent strategic acquisitions in Australia and the UK, both of which were completed towards the end of the half year in year in July and August respectively. I am also pleased to report that strong cash flow has seen net debt almost halved from £6.4m to £3.4m.
Putting (advanced) data science at the heart of all our service offerings remains our core objective and is a key differentiator. This is being achieved through effective internal collaboration across varied but complementary skill sets across Jaywing. This enables us to provide bespoke and highly effective solutions to our clients' most challenging briefs."
Enquiries:
| Jaywing plc | |
| Michael Sprot (Company Secretary) | Tel: 0114 281 1200 |
| Cenkos Securities plc | |
| Ivonne Cantú/Callum Davidson | Tel: 020 7397 8900 |
CHIEF EXECUTIVE COMMENTARY
I'm pleased to report that the momentum built towards the end of our last financial year has been maintained and we have seen strong organic growth rates in the first half of this year. What is more, we've made two strategic acquisitions and have achieved all of this in a period of uncertainty in the market due to the European Union membership referendum.
Overall gross profit (GP) has grown by 11% compared with H1 2016, whilst EBITDA has increased by 18% as EBITDA margin has improved by 0.8% to 12.5%. Profits generated from our acquisitions of Digital Massive and Bloom are included from the start of July and September respectively and accordingly growth has primarily been driven organically with GP up by 7% and EBITDA by 12%.
The Media & Analysis segment comprising search marketing (branded Epiphany) and data analysis, has seen the strongest growth with GP and EBITDA up by 15% and 18% respectively compared with H1 2016. Organic growth excluding acquisitions was still 11% and 14% as the acquisitions were only completed at the start of July and end of August. This segment now represents nearly 70% of our overall EBITDA. The area of strongest growth for Epiphany has been in its programmatic display and mobile advertising revenues where the use of data science provides differentiation and delivers improved outcomes for clients. The demand for our IFRS9 work remains high as smaller lenders are now turning their attention to compliance and the launch of Horizon, our SaaS IFRS9 product, in September has created a great deal of interest amongst those smaller lenders. Product and Product Development sits within this segment and we have continued to invest through our P&L.
We have continued to see organic growth in our Agency Services segment that contains our social media, website design and build, brand communications and customer management outsourcing propositions. Whilst GP has grown by 2%, EBITDA has increased by 7% due to improved margins from H1 2016.
We are encouraged by the performance of our two recent acquisitions with both businesses tracking well against their plans. Digital Massive based in Sydney is leveraging the experience and resources of our Epiphany search marketing team in the UK and has won several new contracts since the acquisition was completed. The team at Bloom has hit the ground running, introducing its unique products to all areas of Jaywing. At the same time, the dedicated environment where the enlarged Company's data products will be developed and managed has been set up.
Further details on both of these acquisitions can be found in the RNS releases dated 7th July 2016 and 1st September 2016.
Cash generation has been strong with net debt reducing to £3.4m from £6.4m at 30th September 2015 (and £5.3m at 31st March 2016). High levels of recurring revenues allied to low client and sector concentration continue to underpin the resilience of the business.
Profit before tax (PBT) has been temporarily impacted by the cost of the acquisitions. Excluding these one off costs, PBT is £758k compared with £503k for H1 2016.
The second half of the year has started well and we are on track to achieve our full year expectations.
Martin Boddy
Chief Executive Officer
21 November 2016
Consolidated interim statement of comprehensive income (unaudited)
| Six months ended 30 Sept 2016 |
Six months ended 30 Sept 2015 |
Audited year ended 31 March 2016 |
||
| Note | £'000 | £'000 | £'000 | |
| Revenue | 4 | 20,895 | 17,051 | 35,973 |
| Direct costs | (3,781) | (1,604) | (4,181) | |
| Gross profit | 17,114 | 15,447 | 31,792 | |
| Other operating income | - | - | 71 | |
| Amortisation | (762) | (787) | - | |
| Operating expenses | (16,446) | (14,370) | (30,538) | |
| Operating (loss)/profit | (94) | 290 | 1,325 | |
| Finance income | 1 | - | - | |
| Finance costs | (111) | (128) | (251) | |
| Net financing costs | (110) | (128) | (251) | |
| (Loss)/profit before tax | (204) | 162 | 1,074 | |
| Tax expense | 5 | (180) | (173) | (369) |
| (Loss)/profit for the period from continuing operations | (384) | (11) | 705 | |
| Exchange differences on retranslation of foreign operations | - | 32 | (18) | |
| (Loss)/profit for the period attributable to the equity holders of the parent | (384) | 21 | 687 | |
| (Loss)/profit per ordinary share | 6 | |||
| Basic (loss)/earnings per share | (0.45p) | 0.03p | 0.90p | |
| Diluted (loss)/earnings per share | (0.41p) | 0.03p | 0.83p | |
Consolidated interim balance sheet (unaudited)
| 30 Sept 2016 | 30 Sept 2015 | Audited 31 March 2016 |
||
| Note | £'000 | £'000 | £'000 | |
| Assets | ||||
| Non-current assets | ||||
| Property, plant and equipment | 763 | 707 | 744 | |
| Goodwill | 36,384 | 30,446 | 30,446 | |
| Other intangible assets | 8,169 | 7,278 | 6,562 | |
| 45,316 | 38,431 | 37,752 | ||
| Current assets | ||||
| Trade and other receivables | 10,953 | 8,402 | 10,150 | |
| Cash and cash equivalents | 2,952 | 1 | 347 | |
| 13,905 | 8,403 | 10,497 | ||
| Total assets | 59,221 | 46,834 | 48,249 | |
| Liabilities | ||||
| Current liabilities | ||||
| Bank overdraft | 7 | - | (184) | - |
| Other interest bearing loans and borrowings | 7 | (4,750) | (4,612) | (4,612) |
| Trade and other payables | (12,883) | (5,824) | (7,534) | |
| Tax payable | (933) | (631) | (452) | |
| Provisions | (175) | (161) | (167) | |
| (18,741) | (11,412) | (12,765) | ||
| Non-current liabilities | ||||
| Other interest bearing loans and borrowings | 7 | (1,600) | (1,594) | (1,063) |
| Deferred tax liabilities | (1,536) | (1,526) | (1,387) | |
| (3,136) | (3,120) | (2,450) | ||
| Total liabilities | (21,877) | (14,532) | (15,215) | |
| Net assets | 37,344 | 32,302 | 33,034 | |
| Equity | ||||
| Capital and reserves attributable to equity holders of the company | ||||
| Share capital | 34,639 | 34,139 | 34,139 | |
| Share premium account | 9,108 | 6,608 | 6,608 | |
| Minority interest | 1,513 | - | - | |
| Capital redemption reserve | 125 | 125 | 125 | |
| Shares purchased for treasury | (25) | (25) | (25) | |
| Share option reserve | 327 | 80 | 146 | |
| Foreign currency translation reserve | 3 | 53 | 3 | |
| Retained earnings | (8,346) | (8,678) | (7,962) | |
| Total equity | 37,344 | 32,302 | 33,034 |
Consolidated interim cash flow statement (unaudited)
| Six months ended 30 Sept 2016 |
Six months ended 30 Sept 2015 |
Audited year ended 31 March 2016 |
||
| Note | £'000 | £'000 | £'000 | |
| Cash flow from operating activities | ||||
| (Loss)/profit for the period | (384) | (11) | 705 | |
| Adjustment for: | ||||
| Depreciation, amortisation and impairment | 997 | 980 | 1,910 | |
| Movement in provisions | 8 | 3 | 9 | |
| Foreign exchange | - | 32 | (18) | |
| Finance income | (1) | - | - | |
| Finance costs | 111 | 128 | 251 | |
| Share based payment charge | 373 | 221 | 412 | |
| Taxation | 180 | 173 | 369 | |
| Operating cash flow before changes in working capital | 1,284 | 1,526 | 3,638 | |
| Decrease/(increase) in trade and other receivables | 27 | (911) | (2,667) | |
| Increase in trade and other payables | 1,210 | 113 | 1,837 | |
| Cash generated from operations | 2,521 | 728 | 2,808 | |
| Interest received | 1 | - | - | |
| Interest paid | (111) | (128) | (251) | |
| Tax paid | (15) | - | (500) | |
| Net cash flow from operating activities | 2,396 | 600 | 2,057 | |
| Cash flows from investing activities | ||||
| Acquisition of subsidiaries Digital Massive and Bloom net of cash acquired | (3,372) | - | - | |
| Receipt/(payment) of deferred consideration | 151 | (1,589) | (1,728) | |
| Acquisition of property, plant and equipment | (245) | (213) | (469) | |
| Net cash outflow from investing activities | (3,466) | (1,802) | (2,197) | |
| Cash flows from financing activities | ||||
| Increase in borrowings | 941 | 550 | - | |
| Repayment of borrowings | (266) | (531) | (513) | |
| Proceeds from issue of share capital | 3,000 | - | - | |
| Net cash inflow/(outflow) from financing activities | 3,675 | 19 | (513) | |
| Net increase/(decrease) in cash, cash equivalents and bank overdrafts | 2,605 | (1,183) | (653) | |
| Cash and cash equivalents at beginning of period | 347 | 1,000 | 1,000 | |
| Cash and cash equivalents at end of period | 2,952 | (183) | 347 | |
| Cash and cash equivalents comprise: | ||||
| Cash at bank and in hand | 2,952 | 1 | 347 | |
| Bank overdrafts | 7 | - | (184) | - |
| Cash and cash equivalents at end of period | 2,952 | (183) | 347 | |
Consolidated interim statement of changes in equity (unaudited)
| Share capital | Share premium account | Capital redemption reserve | Treasury Shares | Minority interest £'000 |
Share option reserve | Foreign currency translation reserve | Retained earnings | Total equity | |
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 |
| Balance at 31 March 2015 | 34,139 | 6,608 | 125 | (25) | - | - | 21 | (8,667) | 32,201 |
| Loss for the period | - | - | - | - | - | - | - | (11) | (11) |
| Retranslation of foreign currency | - | - | - | - | - | - | 32 | - | 32 |
| Charge in respect of share based payments | - | - | - | - | - | 80 | - | - | 80 |
| Total comprehensive income for the period | - | - | - | - | - | 80 | 32 | (11) | 101 |
| Balance at 30 September 2015 | 34,139 | 6,608 | 125 | (25) | - | 80 | 53 | (8,678) | 32,302 |
| Charge in respect of share based payments | - | - | - | - | - | 66 | - | - | 66 |
| Transactions with owners | - | - | - | - | - | 66 | - | - | 66 |
| Profit for the period | - | - | - | - | - | - | - | 716 | 716 |
| Retranslation of foreign currency | - | - | - | - | - | - | (50) | - | (50) |
| Total comprehensive income for the period | - | - | - | - | - | - | (50) | 716 | 666 |
| Balance at 31 March 2016 (audited) | 34,139 | 6,608 | 125 | (25) | - | 146 | 3 | (7,962) | 33,034 |
| Issue of share capital | 500 | 2,500 | - | - | - | - | - | - | 3,000 |
| Acquisition of subsidiaries | - | - | - | - | 1,513 | - | - | - | 1,513 |
| Charge in respect of share based payments | - | - | - | - | - | 181 | - | - | 181 |
| Transactions with owners | 500 | 2,500 | - | - | 1,513 | 181 | - | - | 4,694 |
| Loss for the period | - | - | - | - | - | - | - | (384) | (384) |
| Total comprehensive income for the period | - | - | - | - | - | - | - | (384) | (384) |
| Balance at 30 September 2016 | 34,639 | 9,108 | 125 | (25) | 1,513 | 327 | 3 | (8,346) | 37,344 |
1. General Information
Jaywing plc (the "Company") is incorporated and domiciled in the United Kingdom. The Company is listed on the AIM market of the London Stock Exchange. The registered address is Players House, 300 Attercliffe Common, Sheffield, S9 2AG.
The interim financial information was approved for issue on 22nd November 2016. .
2. Basis of preparation
The consolidated interim financial statements for the six months ended 30 September 2016 have been prepared in accordance with applicable accounting standards and under the historical cost convention except for certain financial instruments that are carried at fair value.
The financial information for the year ended 31 March 2016 set out in this interim report does not constitute statutory accounts as defined in Section 434 of the Companies Act 2006. The Group's statutory financial statements for the year ended 31 March 2016 have been filed with the Registrar of Companies. The auditor's report on those financial statements was unqualified and did not contain statements under Section 498 (2) or Section 498 (3) of the Companies Act 2006.
The consolidated interim financial information should be read in conjunction with the annual financial statements for the year ended 31 March 2016, which have been prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union.
3. Accounting policies
Except as described below, the principal accounting policies of Jaywing plc and its subsidiaries ("the Group") are consistent with those set out in the Group's 2016 annual report and financial statements.
Taxes on income in the interim periods are accrued using the tax rate that would be applicable to expected total annual earnings.
The following standards and interpretations of relevance to the Group have been issued but are not yet effective and have not been adopted by the Group:
· IFRS 9 Financial Instruments (effective 1 January 2018)
· IFRS 15 Revenue for Contracts with Customers (effective 1 January 2018)
· IFRS 16 Leases (effective 1 January 2019)
· IFRS 2 Classification and Measurement of Share-based Payment Transactions (effective 1 January 2018)
The Group are conducting a review of IFRS 15 - Revenue from Contracts with Customers which is ongoing.
The Group does not currently anticipate that the adoption of the other standards and interpretations above will have a material impact on the Group's financial statements in the period of initial application other than IFRS 16 Leases. A review of IFRS 16 will be conducted to determine its impact on the Group.
Other standards and interpretations in issue but not yet effective are not considered to have any relevance to the Group.
4. Segment information (unaudited)
The Group reports its business activities in two areas: Agency Services and Media & Analysis being its two primary business activities. Unallocated represents the Group's head office function, along with intragroup transactions.
Total assets exclude intangible assets, cash and external borrowings which have not been allocated to operating segments.
The majority of the Group's activities are carried out within the UK. There is also a small subsidiary in Australia.
4. Segment information (unaudited) (continued)
| Six months ended 30 September 2016 | ||||
| Agency Services | Media & Analysis | Unallocated | Total Group | |
| £'000 | £'000 | £'000 | £'000 | |
| Revenue | 8,216 | 13,340 | (661) | 20,895 |
| Direct costs | (1,344) | (3,098) | 661 | (3,781) |
| Gross profit | 6,872 | 10,242 | - | 17,114 |
| Operating expenses excluding depreciation, amortisation, exceptional items, acquisition related costs and charges for share based payments | (5,575) | (7,533) | (1,874) | (14,982) |
| Operating profit / (loss) before depreciation, amortisation, exceptional items, acquisition related costs and credit for share based payments | 1,297 | 2,709 | (1,874) | 2,132 |
| Depreciation | (153) | (66) | (16) | (235) |
| Amortisation | (420) | (342) | - | (762) |
| Other exceptional costs | (4) | 2 | (2) | (4) |
| Acquisition related costs | - | (98) | (754) | (852) |
| Charge for share based payments | - | - | (373) | (373) |
| Operating profit / (loss) | 720 | 2,303 | (3,169) | (94) |
| Finance costs | (110) | |||
| Loss before tax | (204) | |||
| Tax expense | (180) | |||
| Loss for the period | (384) | |||
| Six months ended 30 September 2015 | ||||
| Agency Services | Media & Analysis | Unallocated | Total Group | |
| £'000 | £'000 | £'000 | £'000 | |
| Revenue | 7,352 | 9,865 | (166) | 17,051 |
| Direct costs | (666) | (1,104) | 166 | (1,604) |
| Gross profit | 6,686 | 8,761 | - | 15,447 |
| Operating expenses excluding depreciation, amortisation, exceptional items, acquisition related costs and charges for share based payments | (5,536) | (6,530) | (1,574) | (13,640) |
| Operating profit/(loss) before depreciation, amortisation, exceptional items, acquisition related costs and charges for share based payments | 1,150 | 2,231 | (1,574) | 1,807 |
| Depreciation | (128) | (54) | (11) | (193) |
| Amortisation | (458) | (329) | - | (787) |
| Compensation for loss of office | (1) | (29) | (68) | (98) |
| Acquisition related costs | (48) | (165) | - | (213) |
| Credit for share based payments | - | - | (226) | (226) |
| Operating profit / (loss) | 515 | 1,654 | (1,879) | 290 |
| Finance costs | (128) | |||
| Profit before tax | 162 | |||
| Tax expense | (173) | |||
| Loss for the period | (11) |
4. Segment information (unaudited) (continued)
| Year ended 31 March 2016 (audited) | ||||
| Agency Services | Media & Analysis | Unallocated | Total | |
| £'000 | £'000 | £'000 | £'000 | |
| Revenue | 15,700 | 21,218 | (945) | 35,973 |
| Direct costs | (1,899) | (3,227) | 945 | (4,181) |
| Gross profit | 13,801 | 17,991 | - | 31,792 |
| Operating expenses excluding depreciation, amortisation, exceptional items, acquisition related costs and charges for share based payments | (11,669) | (12,804) | (2,986) | (27,459) |
| Operating profit/(loss) before depreciation, amortisation, exceptional items, acquisition related costs and charges for share based payments | 2,132 | 5,187 | (2,986) | 4,333 |
| Other operating income | 64 | 7 | - | 71 |
| Depreciation | (270) | (114) | (23) | (407) |
| Amortisation | (861) | (642) | - | (1,503) |
| Compensation for loss of office | - | - | - | - |
| Exceptional costs | (75) | (24) | (471) | (570) |
| Acquisition related costs | (178) | (38) | 27 | (189) |
| Charges for share based payments | - | - | (412) | (412) |
| Operating profit / (loss) | 812 | 4,376 | (3,865) | 1,323 |
| Finance income | - | |||
| Finance costs | (251) | |||
| Profit before tax | 1,074 | |||
| Tax expense | (369) | |||
| Profit for the period | 705 | |||
| Total assets | Agency Services | Media & Analysis | Unallocated | Total |
| £'000 | £'000 | £'000 | £'000 | |
| 30 September 2016 | 33,477 | 30,384 | (4,640) | 59,221 |
| 31 March 2016 | 24,484 | 29,325 | (5,560) | 48,249 |
| 30 September 2015 | 24,016 | 27,817 | (4,999) | 46,834 |
5. Tax expense (unaudited)
A reconciliation of the charge that would result from applying the standard UK corporation tax rate to profit before tax to the tax charge is given below.
| Six months ended 30 Sept 2016 |
Six months ended 30 Sept 2015 |
Audited year ended 31 March 2016 |
||
| £'000 | £'000 | £'000 | ||
| Recognised in the consolidated statement of comprehensive income: | ||||
| Current year tax | 346 | 273 | 601 | |
| Origination and reversal of temporary differences | (166) | (100) | (232) | |
| Total tax charge | 180 | 173 | 369 | |
| (Loss)/profit before tax | (256) | 162 | 1,074 | |
| Tax charge thereon at UK corporation tax rate of 20% (2015: 20%) | (51) | 32 | 215 | |
| Effects of: | ||||
| Non-deductible expenses | 231 | 54 | 137 | |
| Other | - | 87 | 39 | |
| Prior year adjustment | - | - | (22) | |
| Total tax charge | 180 | 173 | 369 |
6. (Loss)/profit per share (unaudited)
| Six months ended 30 Sept 2016 |
Six months ended 30 Sept 2015 |
Audited year ended 31 March 2016 |
||
| Pence per share | Pence per share | Pence per Share |
||
| Basic (loss)/earnings per share | (0.45p) | 0.03p | 0.90p | |
| Diluted (loss)/earnings per share | (0.41p) | 0.03p | 0.83p |
(Loss)/earnings per share has been calculated by dividing the loss attributable to shareholders by the weighted average number of ordinary shares in issue during the period. The calculations of basic and diluted loss per share are:
| Six months ended 30 Sept 2016 |
Six months ended 30 Sept 2015 |
|||
| £'000 | ||||
| (Loss)/profit for the period from continuing operations | (384) | 21 | ||
| Weighted average number of ordinary shares in issue: | Number '000 | Number '000 | ||
| Basic | 86,260 | 76,260 | ||
| Adjustment for share options, warrants and contingent shares | 7,699 | 6,771 | ||
| Diluted | 93,959 | 83,031 | ||
| Adjusted earnings per share | ||||
| Six months ended 30 Sept 2016 |
Six months ended 30 Sept 2015 |
Audited year ended 31 March 2016 |
||
| Pence per share | Pence per share | Pence per Share |
||
| Basic adjusted earnings per share | 1.66p | 1.46p | 3.38p | |
| Diluted adjusted earnings per share | 1.53p | 1.34p | 3.13p |
Adjusted earnings per share have been calculated by dividing the profit attributable to shareholders before other income, amortisation, impairment and charges for share based payments by the weighted average number of ordinary shares in issue during the period. The numbers used in calculating the basic and diluted adjusted earnings per share are reconciled below:
| Six months ended 30 Sept 2016 |
Six months ended 30 Sept 2015 |
Audited year ended 31 March 2016 |
||
| £'000 | £'000 | £'000 | ||
| (Loss)/profit before tax and impairment | (204) | 162 | 1,074 | |
| Amortisation | 762 | 787 | 1,503 | |
| Acquisition related costs | 850 | 213 | 187 | |
| Charge for share based payments | 373 | 226 | 412 | |
| Adjusted profit attributable to shareholders | 1,781 | 1,388 | 3,176 | |
| Current period tax charge | (346) | (273) | (601) | |
| 1,435 | 1,115 | 2,575 | ||
7. Bank overdraft, borrowings and loans (unaudited)
| 30 Sept 2016 | 30 Sept 2015 | Audited 31 March 2016 |
||
| Summary | £'000 | £'000 | £'000 | |
| Bank overdraft | - | 184 | - | |
| Borrowings, undiscounted cash flows | 6,350 | 6,206 | 5,675 | |
| 6,350 | 6,390 | 5,675 | ||
| Borrowings are repayable as follows: | ||||
| Within 1 year | ||||
| Bank overdraft | - | 184 | - | |
| Borrowings | 4,750 | 4,612 | 4,612 | |
| Total due within 1 year | 4,796 | 4,612 | ||
| In more than one year but less than two years | 1,200 | 1,062 | 1,063 | |
| In more than two years but less than three years | 400 | 532 | - | |
| In more than three years but less than four years | - | - | - | |
| Total amount due | 6,350 | 6,390 | 5,675 | |
| Average interest rates at the balance sheet date were: | % | % | % | |
| Overdraft | - | 2.75 | - | |
| Term loan | 2.75 | 3.56 | 3.56 | |
| Revolving credit facility | 2.75 | 3.51 | 3.51 |
As the loans are at variable market rates their carrying amount is equivalent to their fair value.
The borrowing facilities available to the Group at 30 September 2016 were £2.0 million (2015: £2.0 million) and, taking into account cash balances within the Group, there was £5.0 million (2015: £1.8 million) of available borrowing facilities.
A composite accounting system is set up with the Group's bankers, which allows debit balances on overdraft to be offset across the Group with credit balances.
| Reconciliation of net debt | Cash at bank and in hand | Overdraft | Borrowings | Net debt |
| £'000 | £'000 | £'000 | £'000 | |
| 30 September 2015 | 2,952 | - | (6,350) | (3,398) |
| 31 March 2016 | 347 | - | (5,675) | (5,328) |
| 30 September 2015 | 1 | (184) | (6,206) | (6,389) |
8. Provisions (unaudited)
| 30 Sept 2016 | 30 Sept 2015 | Audited 31 March 2016 |
||
| £'000 | £'000 | £'000 | ||
| At the beginning of the period | 167 | 158 | 158 | |
| Additional provisions | 8 | 3 | 9 | |
| At the end of the period | 175 | 161 | 167 | |
Provisions relate to leases in the Group where the commercial benefit has either ceased or will cease before the normal expiry period.
9. Share capital (unaudited)
Authorised:
| 45p deferred shares | 5p ordinary shares | |||||
| £'000 | £'000 | |||||
| Authorised share capital at 31 March 2016 and 30 September 2016 | 45,000 | 10,000 | ||||
Allotted, issued and fully paid
| 45p deferred shares | 5p ordinary shares | ||||
| Number | Number | £'000 | |||
| Issued share capital at 31 March 2016 | 67,378,520 | 76,359,385 | 34,139 | ||
| Equity raise | - | 10,000,000 | 500 | ||
| Issued share capital at 30 September 2016 | 67,378,520 | 86,359,385 | 34,639 | ||
10,000,000 5p ordinary shares were issued on 31st August 2016.
10. Information on acquisitions
On 7th July 2016, Jaywing announced that it had acquired 75 per cent of Digital Massive's issued share capital for an initial cash payment of AUS$2 million, plus an earn out consideration of up to AUS$2 million, which will be payable in three instalments over the next two years, subject to the future performance of Digital Massive. From July 2020, the Company will, via a put and call option, be in a position to acquire the remaining 25 per cent of Digital Massive's issued share capital, at a multiple of its average audited EBITDA for the previous two financial years, subject to a maximum total consideration payable of AUS$12 million for the entire business.
On 1st September 2016, Jaywing announced that it had acquired the entire issued share capital of Bloom for an upfront cash consideration of £2.41 million on a cash and debt free basis. Additional earn-out consideration of up to £5.75 million is payable to the Vendors, subject to performance criteria, over a two-year period ending 31 March 2018 and will be satisfied through the Company's own cash resources and debt.
A new subsidiary company, of which Jaywing will own 75%, has been incorporated and into which Jaywing will make a capital investment of £637,500 over a period of two years. Certain of the Vendors, comprising certain of Bloom's existing management team will hold the remaining 25 per cent., having transferred into Newco the suite of Bloom Intelligence products. Newco will be led by Alex Craven who will be responsible for developing and monetising all of Jaywing's data science-led products.
Bloom Management will be granted a put option to sell their stake to Jaywing for 2.0 times the average audited maintainable EBITDA for the financial years ending March 2019 and March 2020 subject to a maximum of £4 million for the 25 per cent stake. Jaywing will also have a call option to acquire the 25 per cent stake under the same terms and the time period over which the average EBITDA is taken may be moved further into the future by mutual agreement. Jaywing may choose to pay up to 25 per cent of the additional consideration as shares.
11. Related party transactions (unaudited)
There were no significant changes in the nature and size of related party transactions for the period from those disclosed in the Annual Report for the year ended 31 March 2016.
This information is provided by RNS
The company news service from the London Stock Exchange
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