TIDMTVCH
RNS Number : 2979E
TVC Holdings PLC
09 May 2013
TVC Holdings plc
Preliminary financial results for the year ended 31 March
2013
TVC Holdings plc ("TVC" or the "Company"), the investment
holding company, today (Thursday, 9 May 2013) announces its
Preliminary Financial Results for the year ended 31 March 2013.
Key Performance Highlights:
Ø Gross portfolio return of EUR9.3 million (22% of opening
portfolio value) in the year to 31 March 2013 driven by a realised
gain on disposal of an investment and an increase in value of the
remaining investment portfolio.
Ø Profit before tax for the year of EUR6.6 million.
Ø 6% increase in net asset value (NAV) per share from EUR1.14 at
31 March 2012 to EUR1.21 at 31 March 2013 contributing to compound
annual growth in NAV per share of 15.5% in the four years to 31
March 2013.
Ø Cash and government bonds increased by 9.5% during the year
from EUR72.6 million to EUR79.5 million at 31 March 2013. TVC has
no debt.
Ø Sale of investment in The TAS Group in August 2012. TVC
received cash proceeds of US$9.2 million (EUR7.4 million) and
realised a gain on the sale of this investment of EUR3.9 million in
the year ended 31 March 2013. The sale proceeds represented a
return of 2.1 times the valuation of its investment at 31 March
2012.
Ø Operating expenses, excluding a charge of EUR0.67 million for
restructuring costs, decreased by over 15% to EUR2.06 million
(2012: EUR2.44 million).
Ø Proposed special dividend of 49.5 cent per ordinary share to
return EUR50 million of surplus capital to shareholders. In
addition, shareholder consent to be sought to provide for the
flexibility to implement on-market share buy backs up to a maximum
of 20 per cent of the issued share capital of the Company.
Commenting on the year end Financial Results, TVC Holdings'
Executive Chairman, Shane Reihill, said:
"We are pleased to report another year of strong performance at
TVC. Against a backdrop of continued economic uncertainty, for the
fourth consecutive year the Company's NAV per share has grown,
driven by the sale of our investment in The TAS Group, realising
proceeds of EUR7.4 million, and unrealised value growth in our
investment portfolio. During the year, we evaluated a number of
potential new investment opportunities but chose not to complete
any new investments.
"Since March 2011, TVC's cash and government bonds have
increased by almost EUR50 million to EUR80 million at 31 March 2013
as a result of the sale of Norkom and a number of our unquoted
technology investments. In light of the very limited number of
investment opportunities during this period and after considering a
range of strategic and financial options to enhance shareholder
value, the Board has decided, subject to shareholder approval, to
return the EUR50 million of cash generated by TVC to our
shareholders.
"On a pro-forma basis, after adjusting for the payment of the
proposed special dividend, TVC's net assets at 31 March 2013 would
be EUR72 million mainly comprised of the investment in UTV valued
at EUR32m; three unquoted investments valued at EUR11m; and cash of
EUR29m. We believe that our selective investment approach is the
correct strategy. TVC will continue to look for value enhancing
investments and to manage its existing portfolio in order to
maximise value for all our shareholders".
For further information please contact:
TVC Holdings plc
Shane Reihill, Executive Chairman
John Tracey, Chief Executive Officer
Tel: +353-1-2057700
Murray Consultants
Pauline McAlester
Tel: +353-1-4980300
Davy
John Frain
Tel: +353-1-6796363
Executive Chairman's Statement
Performance for year and overview of investment portfolio
During the year ended 31 March 2013, despite continuing
difficult macroeconomic conditions and a subdued M&A market,
the Group continued to deliver a strong performance through working
with our portfolio companies to maximise value and tight management
of our costs. The Group achieved a gross portfolio return of EUR9.3
million for the year comprised of a realised gain on disposal of an
investment of EUR3.9 million, an increase of EUR3.9 million in the
value of the Group's remaining investment portfolio and portfolio
income of EUR1.5 million.
There were no new investments made during the year and we
disposed of one unquoted investment. Prior to year end, we
undertook some further restructuring of our cost base in light of
the reduction in the size of our investment portfolio and in order
to reduce our operating costs to be in line with our income.
As at 31 March 2013, TVC's investment portfolio was comprised as
follows:
%
Value % Investments
EUR'000 Investments + Cash
---------------------- --------- ------------- -------------
UTV Media plc 31,601 74% 26%
Unquoted Investments 10,935 26% 9%
Total Investments 42,536 100% 35%
Cash & Government
Bonds 79,512 65%
Total Investments
+ Cash 122,048 100%
---------------------- --------- ------------- -------------
TVC's quoted investment in UTV Media plc was valued based on its
closing bid price of GBP1.55 on 31 March 2013. The unquoted
investments were valued in accordance with the International
Private Equity and Venture Capital Valuation Guidelines and the
Group's accounting policies.
As at the reporting date, TVC had cash and government bonds of
EUR79.5 million and no bank debt.
Realisations
In August 2012, TVC disposed of its interest in The TAS Group.
The entire consideration was paid in cash and TVC received proceeds
of US$9.2 million (EUR7.4 million) on completion of the
transaction. The consideration received by TVC represented a return
of 2.1 times the valuation of its investment at 31 March 2012. A
gain on the sale of this investment of EUR3.9 million was realised
in the year ended 31 March 2013.
In March 2013, Intel Corporation (INTC) agreed to acquire
AePONA. On completion of the transaction in April 2013, TVC
received proceeds of US$1.0 million (EUR0.7 million). An unrealised
gain of EUR0.7 million is included in the Company's financial
statements for the year ended 31 March 2013 as, at that date, the
investment in AePONA was valued at EUR0.7 million being the amount
of the anticipated sale proceeds. The carrying value of TVC's
investment in AePONA at 31 March 2012 was EURnil.
Net asset value ("NAV") per share
The Company's net assets per share of EUR1.21 at 31 March 2013
increased by 6% over the year from 31 March 2012 (EUR1.14). The
movement in the NAV per share during the year ended 31 March 2013
was as follows:
Cent per
EUR'000 EUR'000 share
----------------------------------------- -------- -------- ---------
Net asset value at 31 March 2012 115,186 113.9
Realised gains on disposal of unquoted
investments 3,909 3.9
Unrealised gains on investments
* UTV Media plc 1,727
* Unquoted investments 2,190 3,917 3.9
--------
Net costs (excl. share based payment
expenses) (1,112) (1.1)
Net asset value at 31 March 2013 121,900 120.6
----------------------------------------- -------- -------- ---------
Special Dividend and Share Buy Back
In recent months, the Board has considered a range of strategic
and financial options to enhance shareholder value. The Board, in
consultation with its advisers, reviewed a number of factors
including:
Ø The Group's current cash position;
Ø The level of capital expected to be required to fund new
investment opportunities and to support the Company's existing
portfolio of investments;
Ø The Company's projected investment income and operating costs;
and
Ø The Company's market capitalisation which continues to trade
at a substantial discount to its net asset value.
Following this review and after careful consideration and
consultation with its advisers, the Board unanimously determined
that it would be in the best interests of the Company and its
shareholders as a whole to return EUR50 million of surplus capital
to shareholders in the form of a special dividend and, in addition,
to provide for the flexibility to implement on-market share buy
backs up to a maximum of 20 per cent of the issued share capital of
the Company. The Board believes that a return of capital would
represent the most effective use of those shareholder funds. The
Company's remaining cash balance of EUR29 million will be used to
invest in existing portfolio companies should the opportunity
arise; to fund value enhancing new investments; and to engage in
opportunistic share buy backs.
Consequently, subject to shareholder approval at the Company's
AGM to be held in June 2013, the Board is recommending a special
dividend of 49.5 cent per ordinary share to be paid on 25 September
2013 to shareholders on the register on 13 September 2013.
Having the authority to repurchase its shares will enable the
Company to respond to volatile stock market conditions, help
stimulate liquidity in the Company's shares and provide
shareholders with the flexibility, but without any compulsion, to
realise value in respect of all or some of their shareholdings.
Share buy backs will only be executed when appropriate financial
and stock market conditions prevail and when the Board determines
that they are in the interests of the Company and its shareholders
as a whole. The Company will not be able to repurchase shares
during a Close Period, as defined by the AIM and ESM Rules.
The ability of the Company to repurchase its shares will be
conditional upon shareholder approval of various resolutions and
the granting of a waiver by the Irish Takeover Panel of obligations
for certain parties under Rule 37 of the Irish Takeover Rules. A
circular containing further details on the proposed buy back
authorities and convening an extraordinary general meeting of the
Company, to be held on the day of the Company's next annual general
meeting in June 2013, will be posted to shareholders with the 2013
Annual Report.
Business strategy and outlook
Since March 2011, TVC's cash and government bonds have increased
by almost EUR50 million to EUR80 million at 31 March 2013 as a
result of the sale of Norkom and a number of our unquoted
technology investments. In light of the very limited number of
investment opportunities during this period and after considering a
range of strategic and financial options to enhance shareholder
value, the Board has decided, subject to shareholder approval, to
return the EUR50 million of cash generated by TVC to our
shareholders.
On a pro-forma basis, after adjusting for the payment of the
proposed special dividend, TVC's net assets at 31 March 2013 would
be EUR72 million mainly comprised of the investment in UTV valued
at EUR32m; three unquoted investments valued at EUR11m; and cash of
EUR29m. We believe that our selective investment approach is the
correct strategy. TVC will continue to look for value enhancing
investments and to manage its existing portfolio in order to
maximise value for all our shareholders.
Board, management and staff
We were pleased to welcome David Doyle who joined the Board in
September 2012. Rory Quirke resigned from the Board on 8 May 2013.
On behalf of the Board, I would like to thank Rory for his valuable
contribution to TVC and to wish him well in his future career.
I would like to thank TVC's Board, management and staff for
their continued commitment and significant contribution to the
successful outcome for the year.
Shane Reihill
Executive Chairman
9 May 2013
Condensed consolidated statement of financial position
as at 31 March 2013
2013 2012
Notes EUR'000 EUR'000
-------------------------------------- ------ -------- --------
Non-current assets
Investments designated as fair value
through profit or loss
Quoted equity investments 31,601 29,874
Unquoted equity investments 8,935 11,736
Loans and receivables 2,000 500
-------------------------------------- ------ -------- --------
Total investment portfolio 2 42,536 42,110
Property, plant and equipment 99 125
--------------------------------------- ------ -------- --------
Total non-current assets 42,635 42,235
--------------------------------------- ------ -------- --------
Current assets
Available-for-sale investments 3 14,511 14,513
Other receivables 1,129 1,407
Cash and cash equivalents 65,001 58,111
--------------------------------------- ------ -------- --------
Total current assets 80,641 74,031
--------------------------------------- ------ -------- --------
Total assets 123,276 116,266
--------------------------------------- ------ -------- --------
Current liabilities
Trade and other payables (1,366) (1,045)
Current taxation payable (10) (35)
--------------------------------------- ------
Total current liabilities (1,376) (1,080)
--------------------------------------- ------ -------- --------
Net assets 121,900 115,186
--------------------------------------- ------ -------- --------
Equity
Shareholders' capital 1,011 1,011
Share option reserve 175 77
Retained earnings 120,714 114,098
--------------------------------------- ------ -------- --------
Total equity 121,900 115,186
--------------------------------------- ------ -------- --------
Condensed consolidated income statement
for the year ended 31 March 2013
2013 2012
Notes EUR'000 EUR'000
--------------------------------------------- ------ ----------- ----------
Realised profits over opening value
on the disposal of investments 3,909 1,460
Unrealised profits on the revaluation
of investments 3,917 8,118
--------------------------------------------- ------ ----------- ----------
7,826 9,578
Portfolio income
Dividends 1,367 883
Fees receivable 95 260
--------------------------------------------- ------ ----------- ----------
Gross portfolio return 9,288 10,721
Operating expenses (including restructuring
costs of EUR0.67m (2012: EURnil)) (2,731) (2,438)
--------------------------------------------- ------ ----------- ----------
Net portfolio return 6,557 8,283
Finance income 332 885
Exchange movements (273) 20
--------------------------------------------- ------ ----------- ----------
Profit before tax 6,616 9,188
Income tax - (119)
--------------------------------------------- ------ ----------- ----------
Profit after tax for the financial
year 6,616 9,069
--------------------------------------------- ------ ----------- ----------
Earnings per share
Basic EPS (cent) 5 6.5 9.0
Diluted EPS (cent) 5 6.5 9.0
--------------------------------------------- ------ ----------- ----------
Condensed consolidated statement of comprehensive income
for the year ended 31 March 2013
2013 2012
EUR'000 EUR'000
------------------------------------ --------- ---------
Profit for the year 6,616 9,069
Other comprehensive income - -
------------------------------------ --------- ---------
Total comprehensive income for the
year 6,616 9,069
------------------------------------ --------- ---------
Condensed consolidated statement of cash flows
for the year ended 31 March 2013
2013 2012
EUR'000 EUR'000
---------------------------------------------- --------- ---------
Cash flows from operating activities
Profit for year before tax 6,616 9,188
Adjusted for:
Depreciation 40 36
Unrealised profits on the revaluation of
investments (3,917) (8,118)
Realised profits over opening value on
the disposal of investments (3,909) (1,460)
Exchange movements 273 (20)
Share-based payment expenses 98 77
Finance income (332) (885)
Proceeds from disposal of investments 7,577 1,373
Increase in other current assets (43) (175)
Increase/(decrease) in trade and other
payables 323 (83)
Tax paid (27) (9)
Net cash inflow/(outflow) from operating
activities 6,699 (76)
---------------------------------------------- --------- ---------
Cash flows from investing activities
Purchase of available-for-sale investments (29,504) (29,490)
Proceeds on maturity of available-for-sale
investments 28,950 29,026
Decrease in financial assets - bank deposits
> 3 months - 20,000
Interest received 1,009 1,153
Purchase of property, plant and equipment (14) (31)
Net cash inflow from investing activities 441 20,658
---------------------------------------------- --------- ---------
Net increase in cash and cash equivalents 7,140 20,582
Opening cash and cash equivalents 58,111 37,529
Effect of exchange rate fluctuations (250) -
Closing cash and cash equivalents 65,001 58,111
---------------------------------------------- --------- ---------
Condensed consolidated statement of changes in shareholders'
equity
for the year ended 31 March 2013
Share
Ordinary Ordinary option Other Retained Total
Shares shares reserve reserves earnings equity
No. EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
Balance at 1 April 2011 101,112,579 1,011 1,497 1,995 101,537 106,040
Profit for the year - - - - 9,069 9,069
Total comprehensive income
for the year - - - - 9,069 9,069
Share-based payments - - 77 - - 77
Release from share-based
payments reserves - - (1,497) (1,995) 3,492 -
Balance at 31 March 2012 101,112,579 1,011 77 - 114,098 115,186
Profit for the year - - - - 6,616 6,616
Total comprehensive income
for the year - - - - 6,616 6,616
Share-based payments - - 98 - - 98
Balance at 31 March 2013 101,112,579 1,011 175 - 120,714 121,900
--------------------------- ----------- -------- -------- --------- --------- ---------
Notes to the condensed consolidated preliminary financial
information
1 Basis of preparation
The condensed consolidated preliminary financial information of
the Company for the year ended 31 March 2013 comprises of the
Company and its subsidiaries (together referred to as the
"Group").
The financial information included in this preliminary financial
results announcement, which should be read in conjunction with the
2012 Annual Report, has been prepared on a consistent basis and
using the same accounting policies as those applied in the prior
year, in accordance with International Financial Reporting
Standards (IFRSs) as adopted by the EU and effective at 31 March
2013. Full details of the Group's accounting policies will be
included in the 2013 Annual Report. None of the new IFRSs or
interpretations that are effective for the financial year ended 31
March 2013 had an impact on the Group's reported income or net
assets.
The condensed consolidated preliminary financial information
presented herein does not constitute full statutory financial
statements of the Group within the meaning of Regulation 40 of the
European Communities (Companies: Group Accounts) Regulations, 1992.
Statutory financial statements for the year ended 31 March 2012
have been filed with the Companies Registration Office. The
auditor's report on those financial statements was unqualified. The
statutory financial statements for the year ended 31 March 2013
will be finalised on the basis of the financial information
presented by the directors in this preliminary announcement and,
together with the independent auditor's report thereon, will be
filed with the Companies Registration Office following the
Company's Annual General Meeting.
The consolidated financial information is presented in Euro,
rounded to the nearest thousand, which is the functional currency
of the parent company and its subsidiaries.
The preparation of the condensed consolidated preliminary
financial information requires management to make judgements,
estimates and assumptions that affect the application of policies
and reported amounts of assets and liabilities, income and
expenses. Actual results could differ materially from these
estimates. In preparing this financial information, the significant
judgements made by management in applying the Company's accounting
policies and the key sources of estimation uncertainty are the same
as those that applied to the consolidated financial statements as
at and for the year ended 31 March 2012.
2 Investment portfolio
Equity investments Loans and
receivables Total
EUR'000 EUR'000 EUR'000
--------------------------------------- --------------------- --------------- ----------
Year to 31 March 2013
At 1 April 2012 41,610 500 42,110
Revaluation 6,325 1,500 7,825
Disposals (7,400) - (7,400)
Exchange movements 1 - 1
--------------------------------------- --------------------- --------------- ----------
At 31 March 2013 40,536 2,000 42,536
--------------------------------------- --------------------- --------------- ----------
Quoted 31,601 - 31,601
--------------------------------------- --------------------- --------------- ----------
Unquoted 8,935 2,000 10,935
--------------------------------------- --------------------- --------------- ----------
Year to 31 March 2012
At 1 April 2011 33,492 500 33,992
Revaluation 6,556 - 6,556
Disposals - - -
Exchange movements 1,562 - 1,562
--------------------------------------- --------------------- --------------- ----------
At 31 March 2012 41,610 500 42,110
--------------------------------------- --------------------- --------------- ----------
Quoted 29,874 - 29,874
--------------------------------------- --------------------- --------------- ----------
Unquoted 11,736 500 12,236
--------------------------------------- --------------------- --------------- ----------
3 Available-for-sale investments
---------------------------------- --- ----------------- -------------
2013 2012
EUR'000 EUR'000
-------------------------------------- ----------------- -------------
At beginning of year 14,513 14,483
Additions 29,504 29,490
Disposals, repayments (28,950) (29,026)
Amortisation of premium paid (556) (434)
At end of year 14,511 14,513
--------------------------------------- ----------------- -------------
The available-for-sale investments at the end of the year
represent investments in German government fixed rate Euro bonds
with a maturity date in April 2013 (2012: April 2012).
4 Segmental analysis
Segmental information is presented in respect of the Group's
investment portfolio based on whether the investee company is
quoted or unquoted. The Group has only one reportable geographical
segment as its investments are all located in the Island of
Ireland. The segmental information presented is consistent with the
Group's internal analysis of its investment portfolio.
UTV Unquoted
Media plc investments Total
Year to 31 March 2013 EUR'000 EUR'000 EUR'000
--------------------------------------- ----------- ------------- --------
Gross portfolio return
Realised profits over opening
value on the disposal of investments - 3,909 3,909
Unrealised profits on the revaluation
of investments 1,727 2,190 3,917
Portfolio income 1,367 95 1,462
--------------------------------------- ----------- ------------- --------
3,094 6,194 9,288
--------------------------------------- ----------- ------------- --------
Net (investment)/divestment
Realisation proceeds - 7,400 7,400
- 7,400 7,400
--------------------------------------- ----------- ------------- --------
Statement of financial position
Value of investment portfolio
at end of year 31,601 10,935 42,536
--------------------------------------- ----------- ------------- --------
UTV Unquoted
Media plc investments Total
Year to 31 March 2012 EUR'000 EUR'000 EUR'000
--------------------------------------- ----------- ------------- --------
Gross portfolio return
Realised profits over opening
value on the disposal of investments - 1,460 1,460
Unrealised profits on the revaluation
of investments 5,097 3,021 8,118
Portfolio income 883 260 1,143
--------------------------------------- ----------- ------------- --------
5,980 4,741 10,721
--------------------------------------- ----------- ------------- --------
Net (investment)/divestment
Realisation proceeds - 1,460 1,460
- 1,460 1,460
--------------------------------------- ----------- ------------- --------
Statement of financial position
Value of investment portfolio
at end of year 29,874 12,236 42,110
--------------------------------------- ----------- ------------- --------
5 Earnings per share
2013 2012
Basic earnings per share (cent) 6.5 9.0
Diluted earnings per share (cent) 6.5 9.0
Earnings (EUR'000)
Profit for the year 6,616 9,069
--------------------------------------------- ------------ ------------
Number of shares (Number)
Weighted average number of shares in issue 101,112,579 101,112,579
Number of dilutive shares under options 1,324,156 -
--------------------------------------------- ------------ ------------
Weighted average number of shares including
dilutive share options 102,436,735 101,112,579
Basic earnings per share is calculated by dividing the profit
for the year attributable to ordinary shareholders by the weighted
average number of ordinary shares during the year.
Diluted earnings per share is calculated by dividing the profit
for the year attributable to ordinary shareholders by the weighted
average number of ordinary shares adjusted for the effect of all
potentially dilutive shares and instruments, including share
options. In the prior year, the exercise price of all share options
exceeded the average price of ordinary shares during the year and
the share options were therefore excluded from the diluted earnings
per share calculation.
6 Dividend
2013 2012
EUR'000 EUR'000
------------------------------------------------ -------- --------
Proposed for approval at AGM:
Equity dividend on ordinary shares:
Final dividend of 49.5 cent per ordinary share
(2012: nil) 50,051 -
------------------------------------------------ -------- --------
Subject to shareholders' approval at the Annual General Meeting,
the dividend will be paid on 25 September 2013 to shareholders on
the register on 13 September 2013. In accordance with IFRS this
dividend has not been provided for in the Consolidated Statement of
Financial Position as at 31 March 2013.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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