Toluna Plc
Toluna plc (“the Company”), the leading European independent provider of online panels and technology services to the market research industry, today announces its results from the 16 March 2005 to 31 December 2005, which includes trading from 10 May 2005. These are the first year end results to be announced since the placing and admission to AIM in May 2005. Highlights- Successful IPO on AIM in May
- Proforma turnover for the Group of GBP 3 million, nearly tripling the previous year result
- Proforma PBT of GBP 756,000, over 22 times the previous year
- Revenues up significantly across all three lines of business: panel access, panel building and access to technology
- In line with stated strategy, significant expansion of operations to create a Pan-European presence with offices and management team in Paris, London and in Frankfurt following acquisition of German online pioneer Speedfacts in December 2005
- Growth in panellists from 350,000 in May 2005 to 875,000 currently, now across 13 countries
- Current trading very strong: Q1 revenue of GBP1.4 million, up 260%.
Commenting on the results, Non Executive Chairman, George Kynoch said, “I’m delighted the results reflect the Group’s continuing strong performance and are significantly ahead of management expectations. Demand for all our services continues to grow as market research companies switch an increasing proportion of their market research online. This gives us considerable confidence in the growth potential of Toluna.” Further enquires
Toluna plc.
Frederic-Charles Petit, Chief Executive Tel: 00336 33 08 03 91
Richard Bernstein, Non-Executive Director Tel: 0207 491 0770
Powerscourt
Victoria Palmer-Moore Tel: 0207 236 5680
Notes to Editors
Toluna operates and builds online panels across Europe. It has designed and operates software to enable research to be undertaken online.
Toluna offers three core services to the market research industry:
- access to its online panellists;
- creation of dedicated online panels; and
- licensing of its own hosted proprietary technology.
The group operates across Europe with offices in London, Paris and Frankfurt, following the acquisition of Speedfacts at the end of 2005.
Chairman's Statement
I am pleased to report the results of the Group for the period from incorporation, 16 March 2005 to 31 December 2005. The Group commenced trading on 10 May 2005. These are the first year end results to be announced since our placing and admission to AIM in May 2005, and I am pleased to be able to report profit before taxation of £430,000. These excellent results have been achieved alongside a significant expansion of our operations to create a pan-European presence. No direct comparatives have been included as Toluna Plc was incorporated as a new holding company for the Group in March 2005. Proforma turnover for the Group for the full year was £3 million and proforma profit before taxation was £756,000 as detailed in the proforma income statement at the end of this statement, showing growth of 2.8 times turnover and 22.2 times profit before taxation. Your directors are not recommending a dividend for the period.
When Toluna acquired the operating subsidiaries on 10 May 2005, the business was operating from one office in Paris with five international panels and a total of 350,000 panel members. Since then, we have successfully opened an office in London and our acquisition of Speedfacts Gesellschaft für Online Research mbH (“Speedfacts”) at the year end has given us a strong presence in Germany. Presently, we have panels in 13 European countries and 875,000 panellists. Demand for our services continues to grow as market research companies and others switch an increasing proportion of their market research online, drawn by the very significant advantages in cost and speed of processing. This gives us considerable confidence in the growth potential of the Company. The investment made during 2005 will enable the Company to handle the increasing level of business.
Placing and admission to AIM
Toluna was incorporated on 16 March 2005 and acquired the trading subsidiaries Cjudge Limited and Cjudge SAS on 10 May 2005. On 25th May 2005, the Company raised £4.4million, net of expenses, by means of a placing accompanied by admission of the Company’s shares to AIM. The funds raised from the placing allowed us to accelerate our growth by increasing our panel size and market penetration, while continuing to invest in the development of our technology, opening of new offices and the identification of sound strategic acquisitions. The capital injection and the good reception from the market has given us significant momentum which has continued into the current year.
Toluna’s shares, which were priced at 70p in the float, have recently traded at 130p. While share prices are volatile and not within the company’s control, we are pleased the shares sit at a significant premium to the placing price at float.
Speedfacts Acquisition
On 30 December 2005, Speedfacts was purchased for £2.06 million. The consideration was satisfied by the payment to the vendors of £1.91 million in cash and by the issue of 146,588 new ordinary shares in Toluna. The acquisition was a first step in our strategy of expanding into other major European markets, giving us an immediate presence in Germany, together with an important strategic co-operation agreement with freenet.de AG, one of Germany’s biggest internet service providers.
Operational Review
Revenue has grown across all three lines of business: panel access, panel building and access to technology.
This significant improvement in performance resulted from:
- The successful strategy of expanding our office network with offices in London in addition to our operational centre in Paris. Your directors strongly believe that although our focus is online panel and technology, clients also benefit from contact with local teams who understand local markets;
- The leveraging of our offering to clients, providing not only strong sample services but also panel building and proprietary access to hosted data collection technology;
- Adding more resources to service clients, in project management, sales and consulting;
- Increasing repeat business from existing clients, as well as developing and broadening our portfolio of clients.
This has been achieved by adding fresh talented management to the core team at Toluna in sales, IT, client services and finance. Toluna is strongly committed to continue to invest in its people in order to continue and accelerate our strong growth.
Services
Toluna offers its clients access to its panel, panel building operations and to its technology. This gives the Group the ability to offer a wide range of services specifically suited to client needs and to adapt to the evolving requirements of those clients in a market that is still changing, while reshaping market research.
Capacity to deliver services, whether they are panel or technology driven, is key to the long term success of Toluna. Toluna has invested in people by growing the production, panel management, IT and sales team.
- Panel Access and Panel Building
As part of our efforts to offer ever-better service to clients, we have grown our panel base from five countries to 13 and from 350,000 panellists to 729,000 as of 31 December 2005.
We have also worked hard to maintain the quality of our panellist relationship management through our “testandvote” and “Toluna” portals. This has been achieved by developing the functions of the panellist portals (quick vote, product testing and opinions gathering).
- Technology
In 2005, our portfolio of technology clients grew by adding new clients such as Galeries Lafayette, SwissLife and Best Western. In line with our stated strategy, we have invested in infrastructure and research and development. This has involved:
- Growing our IT resources;
- Upgrading our IT capacity by investing in new equipment;
- Creating access to new resources of research and development; and
- Development of our new AutomateSurvey solution.
Toluna is distinguished from its competitors by the high levels of investment in proprietary IT and in research and development. This has been key to the past development of our offer and we intend to continue in that vein.
Prospects
The strong growth seen in 2005 has continued into the current year, with revenue in the first quarter of £1.4 million, an increase of approximately 260 per cent. over the same period in 2005. The market for our services continues to increase and the investment and hard work that has been put in by Toluna’s management and staff is achieving positive results. On behalf of your Board I should like to take this opportunity to thank all the staff, management and advisers for their significant contribution to our success over the past year.With a strong start to the year, your directors are confident that Toluna’s prospects are excellent. We believe our investment in the future gives us a solid platform from which to exploit our position as one of the leading players in a fast growing market place.
George Kynoch
Chairman
3 April 2006
Unaudited Proforma Consolidated Income Statement
The additional proforma information does not form part of the financial statements on which the auditors have issued their report; however, it should be read in conjunction with them. The Group acquired Cjudge on 10 May 2005 and therefore the consolidated income statement in the financial statements only includes the results from that date. The following proforma information shows the results of the Group for the full year ended 31 December 2005 as if the Group had been in existence for the full year. The comparative figures are extracted from the placing document dated 13 May 2005.
| Proforma year ended 31 December 2005 £’000 |
Year ended 31 December 2004 £’000 |
|
| Revenue | 3,001 | 1,069 |
| Staff costs (excluding share option scheme grant cost) | (1,211) | (567) |
| Other operating expenses | (1,147) | (477) |
| Profit from operations | 643 | 25 |
| Net investment income | 113 | 9 |
| Profit before tax | 756 | 34 |
| Tax | (233) | (14) |
| Retained profit for the financial year | 523 | 20 |
| Earnings per share | ||
| Basic | 1.46p | n/a |
| Diluted | 1.45p | n/a |
The earnings per share have been calculated on the assumption that the shares at the time of the acquisition of Cjudge Ltd and at the time of listing on AIM were in issue for the full year.
The retained profit for the financial year using the actual tax payable of £45,000 would be £711,000. The earnings per share based on these retained earnings are basic 1.99 pence and diluted 1.97 pence.
| Consolidated Income Statement | ||
| Note | Period from 16 March 2005 to31 December 2005 £’000 |
|
| Revenue | 2,155 | |
| Staff costs | (1,001) | |
| Other operating expenses | (839) | |
| Profit from operations | 315 | |
| Net interest income | 115 | |
| Profit before tax | 430 | |
| Tax | 2 | (147) |
| Retained profit for the financial year period | 283 | |
| Earnings per share | ||
| Basic | 4 | 0.99p |
| Diluted | 4 | 0.98p |
| Consolidated Balance Sheet | ||
| 31 December 2005 £’000 |
||
| Non-current assets | ||
| Goodwill | 2,088 | |
| Other intangible assets | 458 | |
| Property, plant and equipment | 70 | |
| Deferred tax | 295 | |
| 2,911 | ||
| Current assets | ||
| Trade and other receivables | 1,323 | |
| Cash and cash equivalents | 2,968 | |
| 4,291 | ||
| Total assets | 7,202 | |
| Equity and liabilities | ||
| Equity | ||
| Share capital | 359 | |
| Share premium account | 5,365 | |
| Retained earnings | 339 | |
| Total equity | 6,063 | |
| Current liabilities | ||
| Trade and other payables | 1,048 | |
| Tax liabilities | 91 | |
| Total current liabilities | 1,139 | |
| Total equity and liabilities | 7,202 | |
| Consolidated Cash Flow Statement | ||
| Period from 16 March 2005 to 31 December 2005 £’000 |
||
| Operating activities | ||
| Profit before tax | 430 | |
| Adjustments for: | ||
| Depreciation and amortisation | 123 | |
| Share option grant costs | 56 | |
| Loss on disposal of property, plant and equipment | 1 | |
| 610 | ||
| Increase in receivables | (563) | |
| Increase in payables | 481 | |
| Cash generated from operations | 528 | |
| Net investment income | (115) | |
| Net cash from operating activities | 413 | |
| Investing activities | ||
| Interest received | 127 | |
| Interest paid | (12) | |
| Purchase of subsidiary undertakings (net of cash acquired) | (1,540) | |
| Purchase of intangible assets | (446) | |
| Purchase of property, plant and equipment | (37) | |
| Net cash from investing activities | (1,908) | |
| Cash outflow before financing | (1,495) | |
| Financing | ||
| Issue of shares | 4,443 | |
| Finance leases entered into | ||
| Net cash inflow from financing | 4,463 | |
| Increase in cash and cash equivalents in period | 2,968 | |
| Cash at start of the period | - | |
| Cash and cash equivalents at end of the period | 2,968 | |
Notes to the Financial Statements
1. Publication of non-statutory accountsThe financial information set out in this preliminary announcement does not constitute statutory accounts as defined in Section 240 of the Companies Act 1985.
The financial information for the period ended 31 December 2005 has been extracted from the Company's financial statements to that date which have received an unqualified auditors’ report but have not yet been delivered to the Registrar of Companies.
2. Taxation
| Period from 16 March 2005 to 31 December 2005 £’000 |
||
| Current tax | ||
| UK tax | 46 | |
| Foreign tax | - | |
| Deferred tax | 101 | |
| 147 | ||
Deferred tax relates to the utilisation of the deferred tax asset recognised on the acquisition of the Cjudge SAS in respect of accumulated tax losses.
| Tax reconciliation | ||
| Period from 16 March 2005 to 31 December 2005 £’000 |
||
| Operating activities | ||
| Profit before tax | 430 | |
| Tax at 30% on profit before tax | 129 | |
| Non deductible items | 18 | |
| Tax expenses | 147 | |
The diluted earnings per share is calculated on the assumption that all options granted were exercised. This would give rise to a total weighted average number of ordinary shares in issue for the period of 28,397,823.
| Basic £’000 |
Diluted £’000 |
|
| Profit for the financial year | 283 | 283 |
| Earnings per share | 0.99p | 0.98p |
5. Copies of the Report and Accounts will be sent to share holders shortly and will be available from the registered office of the Company, 29 Curzon Street, London W1J 7TL.
