Aegis Media to make a strategic investment in search firm PinZhong

July 26, 2012 — Fusion DigiNet

Aegis Group is to make a strategic investment in local Chinese search search engine marketing agency PinZhong, also known as PZoom. PZoom was  founded by Yu Cheng in 2006. Aegis Group’s investment in PZoom is RMB 24 million (£2.4 million).

Aegis Group’s digital performance marketing network, iProspect, will create a trading and development alliance with PZoom in order to bring more scale and breadth of services to existing and prospective Aegis Media clients in the digital performance marketing segment.  By formalising a partnership with PZoom, Aegis also expects to extend client opportunities to its other global network brands of Carat, Vizeum and Isobar.

Nick Waters, CEO, Aegis Media Asia Pacific said: “Building scale and competitiveness in both search and performance marketing in China is a priority for Aegis. By identifying and investing in a proven brand like PZoom we will contribute significantly to our quest for growth in this space.”

UK, London and China

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DMGT – Q3 results

July 26, 2012 — Fusion DigiNet

DMGT has announced results for the third quarter of their financial year to 1st July 2012 .

Highlights

  • Revenue for the third quarter of £509 million, up 3% on last year on a reported basis and up 4% on an underlying basis
  • Continued good underlying growth from our B2B businesses
  • Return to underlying growth at Associated Newspapers
  • Net debt reduced by £9 million to £800 million
  • Outlook for the year remains unchanged

Business to Business (B2B) – third quarter performance

RMS reported revenues were £42 million, with continued growth driven by core modelling performance as well as new product areas. The difference between underlying and reported revenue growth rates reflects the sale of RMSI in the fourth quarter of the prior year.

The reported revenues of dmg information grew strongly to £63 million, driven by Education (Hobsons) and Property (Landmark and EDR) businesses.

dmg events’ reported revenues increased to £29 million, reflecting a strong performance from the biennnial Global Petroleum Show in June.

Continued good performance from Euromoney Institutional Investor, with reported revenues of £111 million.

Consumer – third quarter performance  

Associated: reported revenues were £210 million, with circulation revenues up 4% and continued market share improvement (Daily Mail 21.6% compared to 21.0% last year and The Mail on Sunday 20.1% compared to 19.8% last year)*. Total underlying advertising revenues were up 2%; comprising newspapers down 5%, newspaper websites (mainly Mail Online) up 69% (when combined these two revenue streams were broadly in line with last year), and other digital advertising (primarily Evenbase) up 15%. For the first three weeks of July, total underlying advertising revenues were 3% ahead of last year.

Headcount reduced by a further 105 (3%) during the quarter to 3,809, 533 (12%) lower than at the start of the financial year.

Northcliffe: reported revenues were £54 million, with circulation revenues up 2% on an underlying basis, reflecting the benefit of recent cover price increases.  Total underlying advertising revenues were down 7% in a difficult market.  There is a continued focus on efficiency with costs reduced by 14%. For the first three weeks of July, total underlying advertising revenues were 7% below last year.

Headcount reduced by a further 86 (4%) during the quarter to 2,280, 251 (10%) lower than at the start of the financial year.

Net debt / financing

Net debt at 1st July, 2012 was £800 million, down from £809 million at 1st April, 2012.  The Group continues to generate strong cash flows and these were primarily used to fund further acquisitions in the quarter.  Acquisitions have now used £82 million of cash year to date (notably Jobrapido, Intelliworks, Xcelligent, Global Grain and Euromoney shares) with proceeds from disposals totalling £16 million year to date (notably the final instalment from the GLM disposal).  Further debt reduction is expected in the fourth quarter.

UK, London

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MoneySupermarket.com Group – interim results for the six months to 30 June 2012

July 26, 2012 — Fusion DigiNet

MoneySupermarket.com Group PLC, the UK price comparison website, has announced its interim results for the 6 months to 30 June 2012.

Highlights

  • Adjusted revenue increased by 15% to £102.2m (2011: £88.8m)
  • Adjusted EBITDA increased by 25% to £28.7m (2011: £23.0m)
  • Adjusted gross margin improved to 71.7% (2011: 71.4%)
  • Cash balances of £36.7m (2011:£32.2m) at 30 June. The Group continues to be highly cash generative, and converted 106% of EBITDA to cash.
  • Interim dividend increased by 20% to 1.8p per share
  • Proposed acquisition of MoneySavingExpert.com for up to £87m approved by shareholders subject to OFT approval:
  • Trading in July is in line with expectations with revenues approximately 10% ahead of the same period last year.
  • The Board is confident in the prospects for the full year.

Peter Plumb, MoneySupermarket.com Chief Executive Officer, said, “The proposed purchase of MoneySavingExpert.com will add to what we offer consumers.  It is among the most trusted brands in consumer finance. Our two brands – while continuing to operate independently – will give us a greater ability to help more customers and will accelerate progress towards our goal of helping every consumer make the most of their money.”

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Progressive Digital Media Group Plc – interim report for the six months ended 30 June 2012

July 26, 2012 — Fusion DigiNet

Progressive Digital Media Group, a content driven media company producing premium business information, has announced it results for the six months ended 30 June 2012.

Highlights

  • Adjusted EBITDA(note 1) increased by 10.3% to £4.3m (2011: £3.9m)
  • Adjusted EBITDA Margin (note 1) increased to 16.6% (2011: 15.5%)
  • Group revenue increased by 2.8% to £25.9m (2011: £25.2m) with Business Intelligence revenues up by 12.5% to £13.5m (2011: £12.0m)
  • Business Intelligence revenues account for 52.1% of Group revenue (2011: 47.6%)
    • Business Intelligence at +12.5%
    • Events and Marketing at -5.3%
  • Reported profit before tax of £2.0m (2011: £1.2m)
  • Successful completion of a £20m share placing to fund acquisitions.
  • Acquisition of Kable, one of the UK’s leading providers of technology expenditure intelligence. Kable provides business information, tactical intelligence, research, analysis and consultancy to a number of the UK’s leading blue chip companies. See the DigiNet article on the Kable acquisition.
  • Exit from the consumer email marketing sector.
  • Full year results likely to be in line with market estimates.

Mike Danson, Chairman of Progressive Digital Media Group Plc, commented, “Our first half results demonstrate that we have made good progress across a number of key metrics delivering increased revenues, margin and earnings against the prior year comparatives. We continue to focus on those areas which present the best opportunities for growth such as Business Intelligence, which pleasingly now accounts for over half of Group revenues.  Our results, together with the fundraising and acquisition of Kable form not only a good platform for future growth but also have allowed the Group to exit from the less profitable consumer email marketing sector.  Moreover, the launch of the new intelligence centres and the performance of our Business Intelligence division as a whole have positioned us well to develop the business rapidly from now on.”

Note 1: Adjusted EBITDA: Earnings before interest, tax, depreciation, amortisation, impairment, and share based payments, and adjusted for costs associated with derivatives, acquisitions, integration and restructure of the Group. Adjusted EBITDA Margin is defined as Adjusted EBITDA as a percentage of Revenue.

Note 2:  EBITDA: Earnings before interest, tax, depreciation, amortisation and impairment. Includes a charge of £0.5 million for share based payments (2011: £0.4 million).

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Yell Group Plc – results for the three months ended 30 June 2012

July 25, 2012 — Fusion DigiNet

Yell Group Plc has announced its results for the three months to 30 June 2012

Financial Highlights

  • Group revenue of £331m decreased by 15%
  • Digital services revenues grew by 40% to £38m
  • Digital directories revenue fell by 16% to £68m
  • Print and other directory revenues fell by 21% to £225m
  • EBITDA of £71m was down £40m
  • Free cash flow of £39m decreased £34m
  • Net debt of £2,181m decreased by £19m from March

Operational Highlights

  • Total digital revenue declined by 2%, and represents 32% of revenue
  • Total digital customers decreased by 0.2% to 925,000
  • Annual digital revenue per advertiser fell by 10% to £478
  • Live customer websites increased by 17% to 408,000
  • Digital directories visitors increased 13% to 44m in June
  • Mobile directories visitors increased 71% to 4.8m in June
  • Print advertisers reduced by 9% to 253,000
  • Print revenue per advertiser decreased by 7% to £780

Mike Pocock, Chief Executive Officer, said, “During the last quarter, we continued to transform the Group, capitalising on our unique position in the SME community. We continued our trials of new digital products, progressed new partnerships, introduced our new corporate brand and enhanced our digital capability through the acquisition of Moonfruit. Whilst we continue to deliver cost savings through our global operating model, the decline in our legacy product revenue continues to negatively affect EBITDA. The Group continued to generate significant amounts of cash and pay down debt. Looking ahead, we remain confident in our four year strategy to transform Yell.”

UK, London

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Commarco/WPP acquires majority interest in digital agency KKLD in Germany

July 24, 2012 — Fusion DigiNet

Commarco GmbH, the German-based marketing services network which is part of WPP, has acquired a majority interest in KKLD GmbH, a German-based digital agency.

Founded by Alexander Diehl in 2005, KKLD specialises in brand and digital communication strategies, creative solutions, eCommerce and social media.  KKLD is based in Berlin and employs 30 people in its offices in Germany and New York.  Clients include BMW, MINI, Baume and Mercier, Bayer and Swarovski.

KKLD’s unaudited revenues for the year ended 31 December 2011 were approximately Euro 4.1 million, with gross assets at the same date of approximately Euro 3.7 million.

Germany, Berlin

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First half 2012 mergers and acquisitions trend report for Private Equity in the Information Industry

July 23, 2012 — Fusion DigiNet

Berkery Noyes has released its first half 2012 mergers and acquisitions trend report for Private Equity in the Information Industry.

The report analyses merger and acquisition activity in the private equity market for the first half of 2012 and compares it with activity in the four previous six-month periods. It features transactions made by financially sponsored acquirers within the Information Industry, including purchases made by subsidiaries or platforms of private equity firms.

Berkery Noyes’ data showed that total volume increased two percent. Vista Equity Partners and Hellman & Friedman each had seven Information Industry transactions in first half 2012, making them the most acquisitive private equity firms by volume. Total value decreased eight percent, from $18.90 billion to $17.33 billion.

M&A activity in the Health and Pharmaceutics segment rose 62 percent and reemerged as the largest vertical market segment tracked in this report. One of the most active related buyers was TPG Capital, which acquired iMDsoft, DecisionView, and PharmARC Analytic Solutions. Lifestyle and Entertainment, previously the largest market segment, leveled off by 21 percent in first half 2012. This came in the aftermath of a 46 percent improvement in second half 2011.

Private equity M&A within the Software portion of the Information Industry remained flat throughout 2011 but increased 15 percent during the last six months. Three of the top ten overall Software deals in first half 2012 were backed by private equity firms. This consisted of Turaz’s announced merger with Misys for $2 billion, Apax Partners and JMI Equity’s announced acquisition of Paradigm for $1 billion, and GTCR’s announced acquisition of CAMP Systems International for $675 million. These deals together accounted for 21 percent of financially sponsored transaction value in the Information Industry.

“Large private equity firms keen on making acquisitions are likely to continue pursuing deal opportunities in the middle and lower middle market,” stated John Shea, Managing Partner at Berkery Noyes. “There are several factors contributing to this. First, they are finding that it currently takes longer in some instances to sell their portfolio companies, which can temporarily limit the amount of capital they have available to invest elsewhere. Second, they are facing heightened competition from strategic buyers, as was demonstrated by the bidding process for Quest Software between Insight Venture Partners and Dell.”

A copy of the FIRST HALF 2012 M&A REPORT FOR PRIVATE EQUITY IN THE INFORMATION INDUSTRY is available at the Berkery Noyes website – here.

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WPP Digital acquires majority stake in marketing technology solution group Acceleration

July 23, 2012 — Fusion DigiNet

WPP Digital has acquired a majority stake in Acceleration Holdings Ltd in Guernsey and Acceleration eMarketing (Pty) Limited in South Africa, the holding companies of Acceleration, a marketing technology solutions group.

Founded in 1999, Acceleration has offices in Buenos Aires, Cape Town, Dubai, Johannesburg, London and New York and and employs 148 marketing technologists. Acceleration helps its clients architect, implement and orchestrate digital marketing and publishing technologies to enhance their digital business initiatives. Acceleration’s clients include Celebrity Cruises, The Economist, South African Tourism and UEFA.

Acceleration’s combined audited revenues for the year ended 31 December 2011 were US$16.8 million, with gross assets of US$7.1 million as at the same date.

UK, London & South Africa, Cape Town & Guernsey

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Millward Brown to acquire consumer insight company, Cadem Advertising, in Chile

July 23, 2012 — Fusion DigiNet

WPP’s wholly owned operating company Millward Brown, a brand, media and communications research business,  has acquired Cadem Advertising S.A., a consumer insights company in Chile.

Founded in 1997, Cadem has operated as a licensee of Millward Brown for many years providing brand tracking, quantitative and qualitative research services.

Cadem employs 87 people and key clients include Coca-Cola, Falabella Retail, Nestle, Telefonica and Unilever.

Cadem’s unaudited revenues for the year ended 31 December 2011 were approximately CLP3.2 billion with gross assets of approximately CLP1.3 billion at the same date.

UK, London & Chile, Santiago

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Aegis to acquire Chinese digital agency, Catch Stone, for initial consideration of £55.2m

July 23, 2012 — Fusion DigiNet

Aegis Group plc is to acquire Beijing Catch Stone Advertising Co., Ltd and the business of Shanghai Catch Stone Culture Media Co., Ltd, an established full service digital media and marketing agency in China, for an initial consideration of RMB 550 million (£55.2 million). Catch Stone will form a separate network brand for Aegis Media in China.

Catch Stone is an established digital agency in China. Its capabilities include digital media planning and buying as well as a range of digital marketing services in areas including creative origination and social media. Catch Stone is a leading media buying agency operating across China with a particular specialism in the automotive and financial services sectors. It has a strong mix of multi-national and local clients in these sectors, including Audi, Nissan, Saic GM Wuling (SGMW), Industrial Bank and Inoherb. Catch Stone was formed in 2002 and now employs over 130 people in Beijing, Shanghai and Guangzhou.

The acquisition is subject to a four year earn-out structure, from 2013 to 2016 inclusive, with further annual consideration payments being made during this period, dependent on the level of future profit growth achieved. The total consideration for the acquisition by 2016 is expected to be around RMB 949.4 million (£95.2 million). If Catch Stone significantly outperforms current forecasts, the total consideration could be higher with a cap on the maximum amount payable of RMB 1.5 billion (£150.4 million). All consideration payments will be satisfied in cash.

The unaudited profit before tax of Catch Stone for the year ended 31 December 2011 was RMB 81 million (£8.1 million) and the value of the gross assets at that time was RMB RMB 375.9 million (£37.7 million).

The RMB: £ exchange rate used in this article is RMB 9.9724: £1.

UK, London & China, Beijing

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