TIDMBOTB

RNS Number : 6189L

Best of the Best PLC

14 January 2021

Best of the Best plc

("Best of the Best", "BOTB", "the Company" or "the Group")

Interim results for the six months ended 31 October 2020

Best of the Best plc runs competitions online to win cars and other prizes.

Online-only model and efficient marketing investment drive ongoing revenue and profit growth

Financial Highlights:

   --       Total revenue for the six months GBP22.09 million (2019: GBP7.60 million) 
   --       Profit before tax GBP6.80 million (2019: GBP1.38 million) 
   --       Earnings per share 59.84p (2019: 12.40p) 

-- Net assets of GBP6.75 million (2019: GBP2.26 million), substantially underpinned by property and cash

   --       Cash balances of GBP11.18 million at 31 October 2020 with no borrowings 

Operational Highlights:

-- Strong performance reflects the move to a pure online model, with continued growth in customer acquisition, enhanced content creation and IT investment

   --       New Midweek Car Competition added 
   --       Ticket prices reduced and Dream Car Competition prizes enhanced 

William Hindmarch, Chief Executive, said:

"These strong results reflect our successful move to a pure online model together with our increased confidence in marketing investment as we look to accelerate growth.

Sales momentum since the period end has been encouraging, and we expect pre-tax profits for the full year to be materially ahead of management's expectations. We look forward to updating shareholders with further progress in due course."

Enquiries:

 
 Best of the Best plc      William Hindmarch, Chief     T: 020 7371 
                            Executive                    8866 
                            Rupert Garton, Commercial 
                            Director 
 
 Buchanan                  Chris Lane                   T: 020 7466 
                            Toto Berger                  5000 
                            Charlotte Slater 
 
   Oakvale Capital           Daniel Burns                 T: 0207 580 
   (Financial Adviser)       Kieran Davey                 3838 
 finnCap                   Corporate Finance            T: 020 7220 
  (Nominated Adviser and    Carl Holmes                  0500 
  Broker)                   Kate Bannatyne 
                            ECM 
                            Alice Lane 
 

The information communicated in this announcement is inside information for the purposes of Article 7 of Regulation 596/2014 Please visit www.botb.com for further information

Chief Executive's Statement

Over the past few years the Company has cautiously but actively reduced the estate of physical sites upon which it was originally established 20 years ago. Having previously traded from up to twenty-six airport and shopping centre locations, the business has completed its evolution and now operates entirely online.

The financial results for the first half reflect the benefits of our successful transition to an online only model, with a reduced cost base and improved capital efficiency. I am particularly pleased with the smooth and measured way in which this transition has been executed, with no loss of overall revenue or unwelcome exceptional costs.

With the transition now complete, the Company is benefitting from a very effective and scalable platform from which it can continue to leverage its brand, supplier relationships and the proprietary systems, software and database it has developed.

Whilst growing our investment in new customer acquisition, alongside improving the products and experience we offer existing players, BOTB has invested in increasing the range of competitions and prizes. I am pleased with the growth delivered in the year to date and how well positioned the business is for the future.

Interim Results

Revenue for the six months ended 31 October was GBP22.09 million (2019: GBP7.60 million). Profit before tax was GBP6.80 million (2019: GBP1.38 million) with earnings per share increasing to 59.84p (2019: 12.40p).

Net assets at 31 October 2020 stood at GBP6.75 million underpinned by cash balances at the period end of GBP11.18 million and our 967-year leasehold office properties in London, valued at GBP0.95 million. The Group has no borrowings.

Competitions, Strategy & CRM

Both our 'Dream Car' and 'Lifestyle' competitions delivered encouraging results and during the period we have added a new Midweek Car Competition, offering a more focused selection of the most popular lower-priced prizes. More recently, the ticket prices in our car competitions have been materially reduced and all cars in the Dream Car Competition are now awarded together with GBP50,000 in cash as standard.

The Lifestyle Competition, which features luxury watches, motorbikes, holidays, other gadgets/technology and cash prizes, continued to perform well showing the benefits of considered diversification. The wide range of prizes in the Lifestyle Competition, with entry prices starting at just 15p, has also significantly broadened our addressable market.

The weekly 'In The Headlights' edits, our YouTube car reviews and other social channel automotive content continue to provide valuable engagement with players. This activity has recently been bolstered by a new 'Under the Hood' section of the website, showcasing recent car winners and prize collections, in-house car reviews, and other editorial content.

BOTB has built a substantial and valuable database, which not only supports its existing competitions, but also offers interesting opportunities for new products and strategic partnerships, which are currently under review.

New player acquisition

We continued to invest confidently to attract new customers to our increased range of competitions and content, through a wide array of digital marketing channels, as well as TV, Radio, Print and PR. Encouraging revenue growth has been delivered by an enlarged in-house marketing team, deploying constantly updated, dynamic and creative content at a granular level across all channels. This has also delivered increasingly efficient customer acquisition metrics.

Social media continues to be a core marketing and community channel, driving both customer acquisition and contributing to brand awareness. We now have a Facebook following of over 350,000 alongside 240,000 Instagram users, actively engaged with our unique content. Traditional media is also used to maximise the Company's exposure to a wide range of demographics, including our 'traditional' airport customer. Investment in print and PR continues to secure frequent coverage of weekly winners and is working well to positively strengthen and promote the BOTB brand.

All investment in this area is carefully analysed on the cost per acquisition of a new customer, versus their lifetime value. This metric, which is tracked in considerable detail across the various channels, is critical in our decision making on where and how we continue to grow our marketing budget in the year ahead.

IT development

There have been numerous iterative changes to the system architecture and website during the period, all aimed at incremental improvements in the user experience of new and existing customers. Our in-house team of developers work to a fortnightly deployment schedule with new code being released regularly and consistently, using AB split testing to refine and roll out new functionality.

Also during the period our native iOS App was soft launched, with the native Android app to follow shortly. Our marketing team is poised to promote both of these apps to our customers as a simpler way to enter our competitions with a richer user experience.

Dividends

In line with various previous distributions, as the Company continues to be profitable, cash generative and benefits from a robust balance sheet, the Board is also pleased to declare the return of approximately GBP3.75 million to shareholders by way of a special dividend (the "Special Dividend") of 40.0p per ordinary share.

The Special Dividend will be paid on 5(th) February 2021 to shareholders on the register at the close of business on 22nd January 2021. The ex-dividend date is 21(st) January 2021. Following the payment of the Special Dividend the Company will retain working capital cash balances in excess of GBP7.0 million, which the Directors consider to be sufficient working capital to fund the Company's activities over the next 12 month period.

Update of FSP

The Company, together with its advisers, remains in ongoing discussions with interested parties from a number of sector verticals and including private equity, who are reviewing information in a data room and having management team meetings. These discussions are continuing despite the renewed constraints of Covid-19, though the related restrictions are naturally impacting the speed of discussions and decision making. The Board wishes to reiterate that there can be no certainty that an offer will be forthcoming or as to the terms of any such offer and looks forward to keeping shareholders updated in due course.

Outlook

The first half of the year has delivered encouraging sales and profits growth, and importantly, we also completed the transition to an online-only business which has driven a step change in growth. This momentum has continued since the period end and, as a result, the Board now expects full year pre-tax profits to materially exceed management expectations.

With the Group well-positioned for the remainder of the financial year and beyond, the Board remains confident about the prospects for the business. I look forward to updating shareholders with further progress in due course.

William Hindmarch

Chief Executive

14 January 2021

 
                                            BEST OF THE BEST PLC 
 
                                  Unaudited Consolidated Income Statement 
                                  For the Six Months Ended 31 October 2020 
 
___________________________________________________________________________________________________ 
 
                                                                  Six Months        Six Months 
                                                              Ended 31/10/20    Ended 31/10/19    Year Ended 
                                                                   Unaudited         Unaudited      30/04/20 
                                                                                                     Audited 
                                                    Notes            GBP'000           GBP'000       GBP'000 
 
 
Revenue                                               2               22,088             7,604        17,789 
 
Cost of sales                                                        (8,206)           (3,033)       (7,267) 
                                                            ----------------  ----------------  ------------ 
 
GROSS PROFIT                                                          13,882             4,571        10,522 
 
Administrative expenses                                              (7,083)           (3,192)       (6,328) 
 
OPERATING PROFIT                                                       6,799             1,379         4,194 
 
Finance income                                                             1                 4            11 
                                                            ----------------  ----------------  ------------ 
 
PROFIT BEFORE TAX                                                      6,800             1,383         4,205 
 
Tax                                                                  (1,188)             (220)         (687) 
                                                            ----------------  ----------------  ------------ 
 
PROFIT FOR THE PERIOD AND TOTAL COMPREHENSIVE 
 INCOME                                                                5,612             1,163         3,518 
                                                            ================  ================  ============ 
 
Profit and total comprehensive income 
 attributable to: 
Owners of the parent                                                   5,612             1,163         3,518 
                                                            ----------------  ----------------  ------------ 
 
Profit on earnings per share expressed 
in pence per share:                                   3 
Basic from continuing operations                                       59.84             12.40         37.51 
Diluted from continuing operations                                     59.39             12.39         37.44 
 
 
                                      BEST OF THE BEST PLC 
 
                            Unaudited Consolidated Statement of Financial Position 
                                      As at 31 October 2020 
 
_________________________________________________________________________________________________ 
 
 
                                             Six Months       Six Months 
                                         Ended 31/10/20   Ended 31/10/19    Year Ended 
                                              Unaudited        Unaudited      30/04/20 
                                                                               Audited 
                                Notes           GBP'000          GBP'000       GBP'000 
 
ASSETS 
 NON-CURRENT ASSETS 
 
Development costs                                   157               70            81 
Property, plant and equipment                     1,098            1,106         1,086 
Deferred tax                                          -                3             3 
                                        ---------------  ---------------  ------------ 
 
                                                  1,255            1,179         1,170 
 
CURRENT ASSETS 
Trade and other receivables                         105              111           376 
Cash and cash equivalents                        11,183            3,238         5,210 
                                        ---------------  ---------------  ------------ 
 
                                                 11,288            3,349         5,586 
 
TOTAL ASSETS                                     12,543            4,528         6,756 
                                        ===============  ===============  ============ 
 
EQUITY 
SHAREHOLDERS' EQUITY 
Called up share capital                             469              469           469 
Share premium                                       199              199           199 
Capital redemption reserve                          237              237           236 
Foreign exchange reserve                             20               26            27 
Retained earnings                                 5,824            1,327         2,369 
                                        ---------------  ---------------  ------------ 
 
TOTAL EQUITY                                      6,749            2,258         3,300 
                                        ===============  ===============  ============ 
 
LIABILITIES 
CURRENT LIABILITES 
Trade and other payables                          4,610            2,061         3,004 
Tax payable                                       1,184              209           452 
 
TOTAL LIABILITIES                                 5,794            2,270         3,456 
                                        ===============  ===============  ============ 
 
TOTAL EQUITY AND LIABILITIES                     12,543            4,528         6,756 
                                        ===============  ===============  ============ 
 
 
 
                             BEST OF THE BEST PLC 
 
             Unaudited Consolidated Statement of Changes in Equity 
                   For the Six Months Ended 31 October 2020 
 
 
 
 
                                Called 
                                    up 
                                 share        Retained     Share 
                               capital        earnings   premium 
                               GBP'000         GBP'000   GBP'000 
 
 Balance at 1 May 2019             469             352       199 
                              --------  --------------  -------- 
 
 Dividends                           -         (1,501)         - 
                              --------  --------------  -------- 
 Transactions with owners            -         (1,501)         - 
                              --------  --------------  -------- 
 Profit for the year                 -           3,518         - 
 Total comprehensive income          -           3,518         - 
                              --------  --------------  -------- 
 
 Balance at 30 April 2020          469           2,369       199 
                              --------  --------------  -------- 
 
 Dividends                           -         (2,157)         - 
                              --------  --------------  -------- 
 Transactions with owners            -         (2,157)         - 
                              --------  --------------  -------- 
 Profit for the period               -           5,612         - 
 Total comprehensive income          -           5,612         - 
                              --------  --------------  -------- 
 
 Balance at 31 October 2020        469           5,824       199 
                              ========  ==============  ======== 
 
 
 
                                  Capital    Foreign 
                               redemption   exchange     Total 
                                  reserve   reserves    equity 
                                  GBP'000    GBP'000   GBP'000 
 
 Balance at 1 May 2019                237         26     1,283 
                              -----------  ---------  -------- 
 
 Issue of share capital 
 Dividends                              -          -   (1,501) 
                              -----------  ---------  -------- 
 Transactions with owners               -          -   (1,501) 
                              -----------  ---------  -------- 
 Profit for the year                    -          -     3,518 
 Total comprehensive income             -          -     3,518 
                              -----------  ---------  -------- 
 
 Balance at 30 April 2020             237         26     3,300 
                              -----------  ---------  -------- 
 
 Dividends                              -          -   (2,157) 
                              -----------  ---------  -------- 
 Transactions with owners               -          -   (2,157) 
                              -----------  ---------  -------- 
 Profit for the period                  -        (6)     5,606 
 Total comprehensive income             -        (6)     5,606 
                              -----------  ---------  -------- 
 
 Balance at 31 October 2020           237         20     6,749 
                              ===========  =========  ======== 
 
 
 
                             BEST OF THE BEST PLC 
 
             Unaudited Consolidated Statement of Changes in Equity 
                   For the Six Months Ended 31 October 2020 
 
 
 
 
 
                                   Called 
                                       up 
                                    share   Retained     Share 
                                  capital   earnings   premium 
                                  GBP'000    GBP'000   GBP'000 
 
 Balance at 1 May 2019                469        352       199 
                              -----------  ---------  -------- 
 
 Dividends                              -      (188)         - 
                              -----------  ---------  -------- 
 Transactions with owners               -      (188)         - 
 Profit for the period                  -      1,163         - 
                              -----------  ---------  -------- 
 Total comprehensive income             -      1,163         - 
                              -----------  ---------  -------- 
 
 Balance at 31 October 2019           469      1,327       199 
                              -----------  ---------  -------- 
 
                                  Capital    Foreign 
                               redemption   exchange     Total 
                                  reserve   reserves    Equity 
                                  GBP'000    GBP'000   GBP'000 
 
 Balance at 1 May 2019                237         26     1,283 
                              -----------  ---------  -------- 
 
 Dividends                              -          -     (188) 
                              -----------  ---------  -------- 
 Transactions with owners               -          -     (188) 
                              -----------  ---------  -------- 
 Profit for the period                  -          -     1,163 
 Total comprehensive income             -          -     1,163 
                              -----------  ---------  -------- 
 
 Balance at 31 October 2019           237         26     2,258 
                              ===========  =========  ======== 
 
 
 
                                          BEST OF THE BEST PLC 
 
                                      Unaudited Consolidated Cash Flow Statement 
                                       For the Six Months Ended 31 October 2020 
 
________________________________________________________________________________________________ 
                                                             Six Months         Six Months 
                                                         Ended 31/10/20     Ended 31/10/19     Year Ended 
                                                              Unaudited          Unaudited       30/04/20 
                                                                                                  Audited 
Cash flows from operating activities          Notes             GBP'000            GBP'000        GBP'000 
Cash generated from operations                  5                 8,697              1,362          4,892 
Tax paid                                                          (455)              (410)          (644) 
                                                      -----------------  -----------------  ------------- 
 
Net cash from operating activities                                8,242                952          4,248 
 
Cash flows from investing activities 
Purchase of intangible fixed assets                                (78)               (63)           (76) 
Purchase of tangible fixed assets                                  (35)               (12)           (18) 
Sale of tangible fixed assets                                         -                  -              - 
Interest received                                                     1                  4             11 
                                                      -----------------  -----------------  ------------- 
 
Net cash from investing activities                                (112)               (71)           (83) 
 
Cash flows from financing activities 
Equity dividends paid                                           (2,157)              (188)        (1,500) 
 
Net cash from financing activities                              (2,157)              (188)        (1,500) 
                                                      -----------------  -----------------  ------------- 
 
Increase in cash and cash equivalents                             5,973                693          2,665 
 
Cash and cash equivalents at beginning 
 of period                                                        5,210              2,545          2,545 
                                                      -----------------  -----------------  ------------- 
 
Cash and cash equivalents at end 
 of period                                                       11,183              3,238          5,210 
                                                      =================  =================  ============= 
 
 

BEST OF THE BEST PLC

Notes to the Interim Financial Statements

For the Six Months Ended 31 October 2020

 
 
 
   1.           BASIS OF PREPARATION 

These condensed interim financial statements are for the six months ended 31 October 2020. They have been prepared with regard to the requirements of International Financial Reporting Standards as adopted by the EU. They do not include all of the information required for full financial statements and should be read in conjunction with the financial statements (under IFRS) of the Group for the year ended 30 April 2020.

The Group is listed on the AIM market of the London Stock Exchange and has prepared the interim financial statements in accordance with AIM rule 18. The Group has elected not to adopt the full scope of IAS 34 'Interim Financial Reports', which is a voluntary requirement.

The financial statements have been prepared under the historical cost convention. Principal accounting policies adopted are consistent with those of the annual financial statements for the year ended 30 April 2020.

   2.             SEGMENTAL REPORTING 

The Directors consider that the primary reporting format is by business segment and that there is only one such segment being that of competition operators. This disclosure has already been provided in these financial statements.

   3.            EARNINGS PER SHARE 

Basic earnings per share is calculated by dividing the earnings attributable to the ordinary shareholders by the weighted average number of ordinary shares outstanding during the year.

Diluted earnings per share is calculated using the weighted average number of shares outstanding during the year, adjusted to assume the exercise of all dilutive potential ordinary shares under the company's share option plans.

 
                                            Six Months       Six Months 
                                                 Ended            Ended       Year Ended 
                                              31/10/20         31/10/19         30/04/20 
                                             Unaudited        Unaudited          Audited 
 Profit and basic and diluted earnings 
  attributable to the owners of the          5,611,363     GBP1,163,137     GBP3,517,626 
  parent 
 Weighted average number of ordinary 
  shares                                     9,377,253        9,377,253        9,377,253 
 Basic earnings per share                       59.84p           12.40p           37.51p 
 Adjusted weighted average number 
  of ordinary shares                         9,448,550        9,386,867        9,394,296 
 Diluted earnings per share                     59.39p           12.39p           37.44p 
 

BEST OF THE BEST PLC

Notes to the Interim Financial Statements

For the Six Months Ended 31 October 2020

 
 
 
   4.          DIVIDS 

A Special Dividend of 20.0 pence per ordinary share was paid on 10 July 2020 to shareholders on the register at the close of business on 26 June 2020.

A final dividend of 2.0 pence per ordinary share for the full year ending 30 April 2020 was paid on 02 October 2020 to shareholders on the register at 18 September 2020.

A Special Dividend of 40.0 pence per ordinary share will be paid on 5 February 2021 to shareholders on the register at the close of business on 22 January 2021. The ex-dividend date is 21 January 2021.

   5.          CASH GENERATED FROM OPERATIONS 
 
                                              Six Months        Six Months              Year 
                                          Ended 31/10/20    Ended 31/10/19    Ended 30/04/20 
                                               Unaudited         Unaudited           Audited 
                                                 GBP'000           GBP'000           GBP'000 
 
 Profit before income tax                          6,800             1,383             4,205 
 Depreciation and amortisation 
  charges                                             25                25                53 
 Finance income                                      (1)               (4)              (11) 
 Decrease / (increase) in trade 
  and other receivables                              270                49             (215) 
 Increase / (decrease) in trade 
  and other payables                               1,603               269             1,212 
 (Decrease) / increase in provisions                   -             (360)             (352) 
                                                   8,697             1,362             4,892 
                                        ----------------  ----------------  ---------------- 
 
   6.          RELATED PARTY DISCLOSURES 

M W Hindmarch is considered to be a related party as he is a Non-Executive Director of the Company. During the six months ended 31 October 2020, payments were made to him totalling GBP10,000 (GBP6,000 for the six months ended 31 October 2019) in respect of consultancy services provided.

   7.          ULTIMATE CONTROLLING PARTY 

The ultimate controlling party at the end of this interim period was W S Hindmarch, the Chief Executive Officer of the Company, by virtue of his controlling shareholding at the statement of financial position date.

   8.          PUBLICATION OF NON-STATUTORY ACCOUNTS 

The financial information contained in this interim statement does not constitute statutory accounts as defined in sections 434 of the Companies Act 2006. All information is unaudited apart from that included for the year ended 30 April 2020.

The statutory accounts for the financial year ended 30 April 2020 were prepared under IFRS as adopted by the EU. These accounts, upon which the auditor issued an unqualified opinion, did not include references to any matters to which the auditor drew attention by way of emphasis without qualifying their report and did not contain statements under 498(2) or (3), (accounting records or returns inadequate, accounts not agreeing with records and returns or failure to obtain necessary information and explanations) of the Companies Act 2006, have been delivered to the Registrar of Companies.

This interim statement will be made available at the Company's registered office at 2 Plato Place, 72-74 St. Dionis Road, London SW6 4TU and will be available on the Company's website: www.botb.com.

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END

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January 14, 2021 02:00 ET (07:00 GMT)

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