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MONEYWEB HOLDINGS LIMITED - Unaudited Condensed Financial Results for the six months ended 31 December 2014

Release Date: 19/03/2015 12:10
Code(s): MNY     PDF:  
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Unaudited Condensed Financial Results for the six months ended 31 December 2014

Moneyweb Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration No: 1998/025067/06)
(JSE code: MNY     ISIN code: ZAE000025409)
("Moneyweb" or "the company" or "the group")

UNAUDITED CONDENSED FINANCIAL RESULTS FOR THE SIX MONTHS ENDED 31 DECEMBER 2014

Condensed Group Statement of Comprehensive Income

                                                    Unaudited   Unaudited    Audited
                                                     6 months    6 months  12 months
                                                    31-Dec-14   31-Dec-13  30-Jun-14
                                                        R'000       R'000      R'000

Revenue                                                14 403      13 592     23 494

Profit/(Loss) before investment income,
fair value adjustments, depreciation,
amortisation, impairments and exchange
gains/(losses)                                            245     (1 649)    (3 371)

Depreciation and amortisation                           (182)       (298)      (578)
Investment income                                         329         540      1 115
Bank interest                                             182         128        253
Fair value adjustment of other investment and
other financial asset                                       -           -         39
Foreign exchange (losses)/gains                           (8)        (43)         18
Profit/(loss) on write-off of tangible assets               7         (6)        (5)

Net profit/(loss) before taxation                         573     (1 328)    (2 529)
Taxation                                                 (60)        (63)      (107)
Net profit/(loss) for the period                          513     (1 391)    (2 636)

Other comprehensive income                                  -           -          -

Total comprehensive profit/(loss) for the
period                                                    513     (1 391)    (2 636)

Basic and diluted earnings/(loss) per share
(cents)                                                  0.48      (1.31)     (2.47)
Weighted average number of shares in issue
(000’s)                                               106 575     106 575    106 575


Reconciliation of headline profit/(loss) 
Net profit/(loss) for the period                          513     (1 391)    (2 636)
(Profit)/loss on write-off of tangible assets             (7)           6         5
Headline earnings/(loss)                                  506     (1 385)    (2 631)

Basic and diluted headline earnings/(loss) per
share (cents)                                            0.48      (1.30)     (2.47)

Weighted average number of shares in issue
(000’s)                                               106 575     106 575    106 575

Condensed Group Statement of Financial Position

                                                    Unaudited   Unaudited    Audited
                                                    31-Dec-14   31-Dec-13  30-Jun-14
Assets                                                  R'000       R'000      R'000
Non-current assets
Tangible fixed assets                                     432         791        545
Investment in joint venture                                13          13         13
Other investment                                           32          24         32
Deferred taxation                                         106         210        165
                                                          583       1 038        755
Current assets
Trade and other receivables                             3 727       3 832      3 622
Other financial asset                                  19 007      18 073     18 679
Cash and cash equivalents                               6 778       8 057      5 749
                                                       29 512      29 962     28 050
Total assets                                           30 095      31 000     28 805

Equity and liabilities
Capital and reserves
Share capital and premium                              32 732      32 732     32 732
Accumulated loss                                      (6 732)     (6 000)    (7 245)
Ordinary shareholders’ interest                        26 000      26 732     25 487

Current liabilities
Trade and other payables                                3 389       3 325      2 502
Taxation                                                   10          10         10
Deferred revenue                                          696         933        806
                                                        4 095       4 268      3 318
Total equity and liabilities                           30 095      31 000     28 805

Net asset value per share (cents)                        24.4        25.1       23.9
Net tangible asset value per share (cents)               24.4        25.1       23.9
Closing number of shares in issue (net of
(treasury) (000’s)                                    106 575     106 575    106 575

Condensed Group Statement of Changes in Equity

                                          Share       Share     Accumulated        Total
                                        capital     premium         deficit
                                          R'000       R'000           R'000        R'000

Balance at 30 June 2013                     107      32 625         (4 609)       28 123
Total comprehensive loss for
the period ended 30 June 2014                 -           -         (2 636)      (2 636)
Balance at 30 June 2014                     107      32 625         (7 245)       25 487
Total comprehensive profit
for the period ended 31
December 2014                                 -           -            513           513
Balance at 31 December 2014                 107      32 625         (6 732)       26 000
Condensed Group Statement of Cash Flow
   
                                                   Unaudited    Unaudited     Audited
                                                    6 months     6 months   12 months
                                                   31-Dec-14    31-Dec-13   30-Jun-14
                                                       R'000        R'000       R'000

Net cash inflows/(outflows) from operating
activities                                             1 090         291      (2 518)

Net cash outflows from investing activities             (61)       (548)         (47)

Cash and cash equivalents at end of period             6 778       8 057        5 749


Financial results
Moneyweb has turned its operating profit around by R1.894m from a loss in the
comparative 6 month period of R1.649m to a profit of R245k at end December 2014.
This turn-around arose from an increase in revenue of 5.97% and a decrease in cost
of sales and operating expenses of 7.1%. Moneyweb has grown its revenue through
event activations and cross platform selling.

Cash flows from operating activities were a positive R1.090m due to positive
movements in working capital, cash generated from operations and bank interest.

Moneyweb has maintained cash reserves of R25.785m which ensures the group is in a
strong going-concern position. This position will enable Moneyweb to take advantage
of investment opportunities in the market. Current assets exceed current liabilities
with a factor of 7.20. The group has remained debt free.

Operating results
We are pleased to announce a return to interim profitability for the period under
review.

The company generated revenue of R14.4 million and a net profit of R513k over the
period. This compares favourably to a net-loss of R1.391m for the previous
corresponding period.

Tangible net asset value improved to 24.4c per share, up from 23.9c from the 30 June
2014 year-end.

This improved operating performance has been driven by a more focused sales effort
coupled with tight cost controls. Our decision to relocate our head office from
Melrose Arch to Houghton has created significant savings which started to come
through in the latter part of the year.

Moneyweb.co.za continues to grow and is consistently serving 4 million page
impressions each month and reaching more than 400 000 visitors. The site was re-
designed in early 2015, and this will open it up to a mobile audience which is
likely to provide a wider reach as well as potential revenue streams.

The Moneyweb Today digital newspaper now reaches more than 150 000 people and serves
more than 1 million page impressions each month. It has begun to contribute revenue
to the bottom-line.

Our business radio shows on the SABC include RSG Geldsake - the biggest business
show in the country - as well as SAfm Market Update, which are attracting new
audiences. We are in the unique position of being the partner of choice for the SABC
in terms of financial content.

Litigation
A core feature of the Moneyweb business is our ability to deliver high-quality
original content to our loyal reader base. We respect our audience and have no
interest in competing on a low-cost aggregation model.

As disclosed in our previous full-year financial results, Moneyweb has been engaged
in litigation against Media24 and its Fin24 business unit. We argue that they have
infringed on our Intellectual Property (IP) and taken advantage of our own
investment in financial journalists to further their coverage and reproduced our
work and presented it as their own. Media24 has denied the allegations, claiming
that copyright does not subsist in the reporting of news.

Having extensively consulted with legal and industry professionals, we are confident
that the Media24 / Fin24 practice is not in-line with either local or international
copyright standards.

Both Moneyweb and Media24 have filed their Heads of Argument. The matter is expected
to be heard in court in the first week of May 2015.

Prospects
The South African business media sector is going through a highly disruptive phase
at the moment. Traditional players are facing restructuring, the closure of the
South African Press Association (SAPA) means that low-cost aggregation is no longer
an option and economic growth remains tepid.

A key benefit for Moneyweb is that we have a low cost base and cash resources to
deploy when we spot tactical opportunities. The six month period under review has
seen Moneyweb invest in both its internal capacity - including sales and editorial -
as well as identify key properties which we will be able to own and monetise over
the coming years.

Importantly we needed to understand exactly what it is we are good at so as to
allocate capital appropriately.

Key opportunities include:

•    Our digital newspaper Moneyweb Today has gained traction and apart from being
     one of the fastest growing digital publications in the business and finance
     sector, is also becoming a regular outlet for financial results for JSE-listed
     businesses;

•    We will be running the inaugural Money Expo in 2015 which alongside our other
     event properties are expected to be both profitable and an excellent
     opportunity to interact with Moneyweb readers;

•    During 2015 we will roll out exciting projects for financial content in
     IsiZulu (Ezemali), financial education (Moneyweb Masterclass) as well as
     crowd-funding and video related content.

A media company is a curious one in that it serves three masters - an audience, its
advertisers and its shareholders. While Moneyweb has historically been good at
serving the former two, it has not dedicated enough focus to the latter. It is our
stated intention to grow our turnover aggressively over the next 18 months and look
to grow organically and by way of investment.

Dividend policy
No dividend has been declared for the interim period.

Post balance sheet events
There are no material events subsequent to the end of the period that require
further disclosure.

Basis of preparation
Statement of compliance
The interim condensed financial statements have been prepared in accordance with the
measurement and recognition requirements of International Financial
Reporting Standards (IFRS), the principles of IAS 34: Interim Financial Reporting,
the AC500 standards as issued by the Accounting Practices Board or its successor for
Interim Reporting and the JSE Listings Requirements and South African Companies Act.

The accounting policies and methods of computation adopted in the interim condensed
financial statements are consistent with those applied in the annual financial
statements for the period ended 30 June 2014 and are in terms of IFRS.

The unaudited interim results have been prepared by the financial director of
Moneyweb, Mr P Meyer CA (SA).

The interim consolidated financial statements have not been reviewed by the
company's auditors.

Basis of measurement
The interim condensed financial statements have been prepared on the historical cost
basis with the exception of certain financial instruments that are stated at fair
value.

Going concern
The interim condensed financial statements have been prepared on the going-concern
basis since the directors have every reason to believe that the company has adequate
resources in place to continue in operation for the foreseeable future.

Changes to the board
On 07 October 2014, Mr Marc Ashton was appointed as managing director of the
company.


On Behalf of the Board
PM Jenkins
Executive Chairman
19 March 2015
Corporate Information

Non executive directors: LW Sipoyo; SJ Gordon; AJ Isbister; BN Sturgeon;
WP van der Merwe; VW Mcobothi
Executive directors: PM Jenkins (Chairman); MJ Ashton; P Meyer
Registered address: Number 5, 8th Street, Houghton Estates, 2096
Postal address: PO Box 8, Melrose Arch, 2076
Company secretary: N Sooka
Telephone: (011) 344 8600
Transfer secretaries: Computershare Investor Services Proprietary Limited
Auditors: BDO South Africa Incorporated
Designated Adviser: Arbor Capital Sponsors Proprietary Limited

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