AVESCO GROUP PLC INTERIMREPORT 2010
www.avesco.com
01
The Group produced a 35% increase in EBITDA on trading operations to £8.3m (2009: £6.1m). Cash generated from the Group’s operations improved to £8.2m (2009: £4.6m), which meant that even in a relatively challenging business environment we managed to generate £4.2m of free cash flow in the six months period (2009: net cash out flow of £2.2m). As a result, net debt at the end of the period reduced to £17.5m (2009: £25.9m) and with gearing at a very manageable 48% (2009: 53%), the Group remains in a healthy financial position.
On 31March 2010, the net assets of the Group were £36.6m(2009: £48.8m) or £1.46 per share (2009: £1.95 per share).
POST-PERIOD DEVELOPMENT The Group has an economic interest in the outcome of existing litigation brought by Celador International Ltd against TheWalt Disney Company and others. After several years, the trial finally began on 1 June 2010 in the US District Court of Riverside, California. A verdict is expected in July. The expected trial costs have been provided for in prior periods.
CURRENT OUTLOOK It is encouraging to report that 2010 is developing far more positively after an exceptionally difficult 2009. As the year has progressed our clients’ outlook has become more upbeat and the Group’s order book for the summer period is much stronger. We are seeing significant business from the 2010 FIFA World Cup in South Africa and the World Expo in Shanghai and there has been a marked upturn in the North American market. Responding to faster than anticipated acceptance of our 3D camera technology we are accelerating our development in this area.
Capital expenditure will be higher than expected because we have brought forward the purchase of some LED screens to support our positioning for the 2012 London Olympics, as well as enhancing our capabilities for the intervening period.
The Board anticipates a trading profit for the financial year, with continuing strong cash generation.
PEOPLE I again would like to thank all of our employees throughout the Group for their support and efforts, which are greatly appreciated. It is the people within the Avesco Group thatmake the difference.
CONCLUSION It is true to say that the Avesco Group has been tested by themarket downturn over the last 18months. However, we have throughout remained true to the principles that we believe in, offering a first class service and applying strong and prudent financial disciplines.We continue to build ourmarket share and reputation. It would not be in keeping with our conservative nature to say that the current positive trends will bemaintained but the signs are certainly encouraging.
MICHAEL GIBBINS CHAIRMAN 17 JUNE 2010
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