Daisy released its financial interim results statement.
The Chairman’s view
The 6 month period ended 30 September 2012 has seen the Group continue to make progress towards its stated aim of being one of the largest providers of unified communications services in the UK to the SME and mid-market sector.
The Group acquired the entire issued share capital of the audio-conferencing specialist Worldwide Group Holdings Limited (“WWG”) in April 2012. The post-acquisition results for WWG have been included in the results for the retail division.
In order to complete the acquisition of WWG in April 2012, the Group increased its borrowing facilities by a further £25.0 million following the introduction of Royal Bank of Scotland plc (“RBS”) to the existing four-strong group of lenders. This takes the total bank facilities to £140.0 million. During the period the Group repaid £6.0 million of term loan borrowings and £5.0 million of the revolving credit facility. Both facilities terminate on 30 June 2013 and have been reclassified as current borrowings accordingly. The Board remains confident about the Group’s ability to refinance on acceptable terms.
Revenues have increased from £176.0m to £178.1m with the increase from WWG mitigating against the impact of market pressures in our traditional revenue streams. Adjusted EBITDA (operating result before depreciation, amortisation, net exceptional operating items and net share based payment credits/charges) has increased by 3% to £27.3m and the Group has generated strong cash flows with net cash generated from operating activities of £20.1 million (2011: £13.1 million) and free cash flow of £17.0 million (2011: £16.9 million).
Key highlights from the report include:
Growth in headline revenue, adjusted EBITDA and net cash generated from operating activities:
Revenue up 1% to £178.1 million (2011: £176.0 million).
Adjusted EBITDA* up 3% to £27.3 million (2011: £26.6 million).
Net cash generated from operating activities up 53% to £20.1 million (2011: £13.1 million).
Significant recovery in free cash flow generation:
Free cash flow up 1% to £17.0 million (2011: £16.9 million).
Free cash flow post-exceptional items up 22% to £14.2 million (2011: £11.6 million) and up 97% versus the second half of the year ended 31 March 2012 (£7.2 million).
Matthew Riley, CEO of Daisy, commented “We are pleased to report the results for this interim period, in which we have seen an improvement in revenue and adjusted EBITDA, as well as a return to strong levels of free cash flow generation.
“Our acquisition of Worldwide Group Holdings Limited, in a growing area of the market, is performing well. The business has achieved an encouraging level of annualised revenue growth so far, and the change of ownership has been welcomed by key customers.
“Whilst the sector continues to experience difficult macroeconomic and regulatory headwinds, we see our own performance balanced positively by our improving revenue mix and product diversification. Looking forward, we remain cautiously optimistic and expect to see continued strong free cash flow generation during the rest of the current financial year.”