Trading Statement

LONDON--(BUSINESS WIRE)-- 

Next Fifteen Communications Group plc

("Next 15" or "the Group"),

FCA Moratorium on publication of results

Trading Update

Next 15, the digital marketing and communications group, announces that the publication of the Company's Full Year Results for the year ended 31 January 2020 will be delayed beyond 6 April 2020, the date on which Next 15 had previously expected to announce. This decision was made following a request by the Financial Conduct Authority (the FCA) to all public companies that, in the light of the ongoing Covid-19 developments, that they delay making preliminary announcements.

The Group is pleased to announce that the unaudited results for the year ended 31 January 2020 were in line with the trading update released on 28 January 2020.

Net revenue increased by 11% to £248m, adjusted operating profit increased by 11% to £40.9m, adjusted profit before tax increased by 12% to £40.2m and adjusted fully diluted EPS increased by 5% to 34.8p. The Group continues to maintain a strong balance sheet, with net debt as at 31 January 2020 of £9.3m, with facilities of £50m in the UK and a further US facility of $7m. Our key banking covenant is that our net debt to EBITDA should be less than 1.75x which compares with 0.2x as at 31 January 2020.

Before we give an update on how our business is performing in light of the Covid-19 virus, we want to address how our staff are being impacted. On 9^th March we took the decision to have all staff in the US work from home. This was soon followed by staff in the UK and Europe. Staff in the AP region were already largely operating in this way and had been for some time. We are pleased to say that the transition to working from home has not interrupted our ability to service our customers as the business already used many of the technologies that are necessary for such a setup.

Next 15’s evolution towards a data and digital business has put us in a better place to deal with the impact of Covid-19. Whilst we are not immune to macro-economic forces, we are fortunate to have a large percentage of our revenues derived from business to business technology customers and only a small percentage from more business to consumer clients in the travel and leisure sectors.

In terms of current trading, we have yet to see any material impact on the business overall and we have seen some benefit from the strength of the US dollar versus Sterling. The Group continues to win new work and has recently added DuPont, Google Cloud, O2 and TDK as new clients. However, we do anticipate our business to be impacted as the wider economic impact of Covid-19 increases. It remains too early to assess the impact that this unfolding situation will have on trading for the year ahead.

Given the macroeconomic backdrop, the Group has already drawn up contingency plans and taken a series of steps to reduce short-term spending. In addition, the Group is deferring all non-critical capital expenditure and taking steps to defer or stagger any anticipated large payments. Lastly, the Group has decided to suspend the final dividend, although it fully intends to resume dividend payments once the macro environment improves.

Given the measures outlined above, the board is confident that Next 15 is well positioned to withstand this unprecedented period and can continue to progress with its growth strategy. Whilst the Group is actively working on how to best manage the current situation it is also looking to the ‘Post Covid’ era to ensure it can capitalize on the shifts an event of this nature is likely to create in the market.

Enquiries:

Next Fifteen Communications Group plc
Tim Dyson, CEO
[phone]
Peter Harris, CFO
[phone]

Numis
Mark Lander, Hugo Rubinstein, Nick Westlake,
[phone]