Hilversum, 10 July 2006 2waytraffic (“2waytraffic” or the “Company”) Pre-close trading update
2waytraffic, the interactive media content provider, today issued the following pre-close period trading update for the six months to 30 June 2006.
During the first half of the financial year 2waytraffic has achieved several significant milestones and begun to deliver on the strategy set out at the time of the Company’s IPO in April 2006. Good progress has been made across all three divisions and the acquisitions of Emexus in June 2006 and Intellygents, announced today, have strengthened the Company’s product offer and geographical reach. 2waytraffic is now one of the leading developers and exploiters of interactive content for both television and mobile telephony distribution, in a global media market which continues to be characterised by convergence of delivery mechanisms and growing demand for high quality content.
Achievements in the first half of the financial year have included:
The successful IPO of the company with a market capitalisation of 155m (£107.9m), after a 35m (£24.3m) fundraising
The acquisition of Emexus, the international mobile content service provider for up to a maximum of 11m in June 2006
The acquisition of Intellygents, the developer of prime time television formats, with an initial consideration of 5 million. Intellygents has successfully developed many entertainment shows and, amongst others, sold two prime time quiz formats (“Take it or Leave it” and “That’s the question”) to broadcasters in territories including the Netherlands, Italy, the USA, France, Spain, Switzerland and the UK
Launch of participation TV in Belgium with SBS
Launch of participation TV in Sweden with TV4
Continued strong trading in the Dutch participation TV business
The first prime time format sold to SBS in the Netherlands
52 episodes of Xplosiv, a late night show including footage of reality stunts, commissioned in the Netherlands
and An encouraging revenue contribution from the digital interactive division, through tie-ups with major advertisers.
Current trading
Based on progress to date and before the contribution from acquisitions, trading is in line with the Board’s expectations. Specifically, we expect revenues for the year to 31 December 2006 to be ahead of expectations, largely due to the inclusion of gross telecoms revenue contributions from two participation TV contracts. EBITDA is expected to be in line with the Board’s full year expectations to 31 December 2006, with the anticipated weighting to the second half of this financial year, due in part to the later than expected commencement and contribution to revenues of certain contracts, evident. Overall, current trading is encouraging and we are confident of the outlook for 2006 and into 2007.
Board reorganisation
To reflect the growth in the business the executive Board has been restructured. Taco Ketelaar been appointed Chief Creative Officer with immediate effect. This will enable him to creating and acquiring new formats in order to extend 2waytraffic’s library of premium content. Glorie replaces Taco as Chief Operating Officer, alongside his existing Board role as Executive Chairman. This will bring a clearer organisational and operational focus to the business.
Chris Pye, non-executive Chairman, has agreed to spend more of his time working with 2waytraffic on creative and UK specific projects. Chris has already made a significant contribution to the business through his knowledge, experience and industry contacts. He previously held senior roles at the BBC, Granada and Sony. It remains the Board’s intention to appoint another independent nonexecutive director in due course. Discussions are continuing with potential candidates.
Commenting on today’s trading update, Kees Abrahams, Chief Executive Officer said: “This has been an extremely busy and rewarding six months for 2waytraffic, the Company we founded just two and a half years ago. The business is positioning itself to be a key player in the roll-out of interactive media services as convergence continues to manifest itself. We remain acquisitive and continue to assess further acquisition opportunities of varying sizes and in several geographic markets.”
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