UPDATE 1-Publicis raises 2010 outlook amid ad recovery

July 30, 2010 By Leave a Comment

PARIS, July 29 (Reuters) – Publicis (PUBP.PA), the world’s third-largest advertising group by revenue, posted better than expected first-half results and raised its outlook as the global advertising industry recovers.

Publicis’ outperformance in the first half was fueled largely by a return to growth in nearly all regions, including the U.S., Europe, Asia, and Latin America, as well as by its digital business, the company said.

“The growth came from both new business and existing clients raising their ad spending,” Publicis CEO Maurice Levy told journalists. “We really have the feeling of being at the end of economic crisis, or even having put it completely behind us.”

Publicis, which competes with WPP (WPP.L) and Omnicom Group Inc. (OMC.N), posted first-half revenues of 2.54 billion euros and operating profit of 369 million euros, and had an operating margin of 14.5 percent.

The results exceeded analysts’ expectations of revenue of 2.44 billion euros, operating profit of 326 million euros, and a 13.4 percent operating margin.

Publicis’ strong performance comes after some of the world’s big advertising groups have sounded optimistic notes about the economic recovery lately as blue-chip companies boost their ad spending.

Omnicom posted better-then-expected results last week with CEO John Wren saying growth had returned to the U.S., Middle East, Asia, and Latin America, although Europe remained sluggish. [ID:nN16117713] [ID:nLDE65O1BB]

Analysts at ZenithOptimedia recently upped their forecast for worldwide advertising market growth from 2.2 to 3.5 percent this year.

“Of our 30 biggest clients, the vast majority of them have increased their ad budgets and are doing more business with us than before,” said Levy.

The group also signed new business contracts worth 2.1 billion euros in the first half.

Levy said the situation led Publicis to raise its full-year guidance for organic growth from 3 percent to at least 3.5 percent.

He also said Publicis hoped to exceed the 15 percent operating margin it achieved last year, a change from its earlier target of meeting last year’s level. [ID:nLDE65O1UT]

Levy added that concerns remained over Europe’s sovereign debt crisis and the prospects for the U.S. economy, but that he felt that Publicis would reach its raised targets nevertheless.

“There are indications that the market could slow, and I take them into account,” he said. “But even in a slowing market Publicis will do better than what we have announced till now.”

(Additional reporting by Cyril Altmeyer, editing by Geert De Clercq)

Filed Under: International News Tagged With: , , , , , , , , , , , , , , , , , , ,

Publicis Groupe: First Half 2010 Results

July 30, 2010 By Leave a Comment

PARIS, July 29, 2010

PARIS, July 29, 2010 /PRNewswire-FirstCall/ –

Second quarter 2010
(EUR million)

– Revenue 1,376 (+21.3%)
– Organic growth +7.1%

First half 2010
(EUR million)

– Revenue 2,538 (+14.9%)
– Organic growth +5.3%
– Operating margin 369 (+28.6%)
– Operating margin rate 14.5%
– Net income (Group share) 213 (+27.5%)
– Free Cash Flow (1) 277 (+42%)
– Headline diluted EPS (2) 1.00 euro (+12%)
– Debt/equity ratio 0.20

(1) Before changes in WCR

(2) After elimination of impairment, amortization of intangibles arising on acquisitions and the tax credit arising on the deferred tax liability on the Oceane 2014 convertible bond.

Maurice Levy, Chairman and Chief Executive Officer of Publicis Groupe declares:

“With organic growth of 7.1% for the second quarter of 2010 and 5.3% for the half-year, an operating margin of 14.5% and net income up by 27.5%, Publicis Groupe has once again given proof of its energy and ability to create value, even in the aftermath of the worst global economic crisis in many years.

This growth is the result of a strategy that has been effectively executed over a number of years. We were quick to take the digital route, gaining a decisive lead over our competitors and providing clients with the best and most innovative solutions for the new landscape being shaped by the explosion of digital technology.

We also opted for expansion in emerging markets. The economic crisis may have slowed the pace of their growth, but ZenithOptimedia’s latest estimates for 2011 and 2012 bode well for strong growth.

The challenges our clients face demand from us greater inventiveness, creativity and innovation, and relentless operational efforts to ensure that they win whatever the circumstances. I would like to thank them for their confidence, and to pay tribute to the hard work of all our teams who have performed wonders within the constraints of strict cost controls, enabling Publicis Groupe to emerge stronger than ever from the crisis.

Tight cost containment since end 2008 and strong growth in revenue have boosted operating margin to an impressive 14.5%, despite the fact that Razorfish is still in the integration phase with a margin that, while improving, is still well below average for the Groupe.

Without lapsing into the euphoria that these half-year results for our Groupe might warrant, I remain firmly convinced that Publicis Groupe will succeed in outperforming the market in terms of both growth and margin.”

At its meeting on July 28, 2010, chaired by Mrs. Elisabeth Badinter, the
Supervisory Board of Publicis Groupe examined the first half results for 2010
presented by Mr. Maurice Levy, Chairman and Chief Executive Officer of
Publicis Groupe.
Key figures

EUR million, except for 1st half 2010 1st half 2009 2010/2009
percentages and
per-share data (EUR)

Income statement data
Revenue 2,538 2,209 14.9%
Operating margin before
depreciation and amortization 422 333 26.7%
As % of revenue 16.6% 15.1%
Operating margin 369 287 28.6%
As % of revenue 14.5% 13.0%
Operating income 353 257 37.4%
Net income attributable to Publicis
Groupe 213 167 27.5%

Earnings per share (1) 1.04 0.83 25.3%

Diluted earnings per share (2) 0.95 0.82 15.8%

Balance sheet data June 30, 2010 June 30, 2009
Total assets 14,458 11,408
Shareholders’ equity 3,090 2,418

(1) The average number of shares used to calculate earnings per share was 204.5 million for 1st Half 2010 and 200.8 million for 1st Half 2009.

(2) The average number of shares used to calculate diluted earnings per share was 237.1 million for 1st Half 2010 and 206.3 million for 1st Half 2009. This includes stock options, free shares, equity warrants and convertible bonds with a dilutive effect on EPS. For the first six months of 2010, the instruments that diluted EPS were the Oceane convertible bonds, equity warrants, free shares and certain tranches of stock options with a strike price below the average price over the period.

Analysis of key figures

I. First half 2010 activity

The global economy rallied over the first half of 2010. After forecasting a 0.9% increase in 2010 global advertising expenditure in its December 2009 forecast, ZenithOptimedia upgraded its forecast in April this year to 2.2% growth and upped its latest estimate yet again, on July 19, to 3.5%. This steady improvement in growth forecasts is most encouraging.

As the advertising market recovered, Publicis Groupe posted an increase of 14.9% in reported revenue for the first half and organic growth of +5.3%.

Second quarter revenue was up by 21.3% and organic growth rose to 7.1%.

Revenue in first half 2010

Consolidated revenue for the first half of 2010 was EUR 2,538 million compared to EUR 2,209 million for the first half of 2009, an increase of 14.9% (exchange rate impact was positive at EUR 55 million).

Organic growth was 5.3%.

First half growth reflects the strong recovery in advertising expenditure after the record slump triggered by the 2009 economic crisis. The larger networks, in particular Leo Burnett and Publicis Worldwide along with VivaKi, made the most of the upturn, and digital activities maintained their strong growth trend.

The breakdown of consolidated revenue for the first half of 2010 is as follows: 33% from advertising, 20% from media and 47% from specialized agencies and marketing services (including digital activities).

Breakdown of first half 2010 revenue by region

(EUR million) Revenue Organic Growth
1st half 2010 1st half 2009

Europe 805 738 +3.1%
North America 1,258 1,061 +6.6%
Asia-Pacific 286 238 +6.0%
Latin America 126 109 +10.8%
Africa and Middle East 63 63 -3.3%

Total 2,538 2,209 +5.3%

Almost all the regions, Europe included, saw a return to growth, with the exception of Africa and the Middle East, which is still suffering from Dubai’s financial crisis.

North America continues to enjoy good growth. Organic growth for the USA was 7.2%, fuelled by strong growth from all the agencies and significant contributions from the healthcare and digital activities, the latter accounting for 42.5% of the region’s revenue.

The Asia Pacific region is growing again, thanks largely to India and Korea.

Every country in Latin America except Chile reported growth.

Expressed in US dollars, first half revenue was USD 3,362 million, an increase of 14.3%.

Revenue in 2nd quarter 2010

Consolidated second quarter 2010 revenue was EUR 1,376 million, an increase of 21.3% on the figure of EUR 1,134 million for the corresponding period in 2009 (the exchange rate impact was positive at EUR 73 million).

Organic growth was +7.1% in the second quarter, a significant improvement on first quarter organic growth of +3.1%.

The second quarter undoubtedly benefited from a low basis of comparison, but the marked upswing in advertising business seen in the first quarter was also maintained.

Growth was also fuelled by new business wins in 2009 and by an increase in advertising spending by major clients.

– Breakdown of 2nd quarter 2010 revenue by region

(EUR million) Revenue Organic Growth
2nd quarter 2nd quarter
2010 2009

Europe 437 381 +7.3%
North America 679 535 +8.1%
Asia-Pacific 154 123 +5.3%
Latin America 71 58 +11.5%
Africa and Middle East 35 37 -10.4%

Total 1,376 1,134 +7.1%

Europe performed well in the second quarter. Only Africa and the Middle East posted negative figures.

Operating margin and operating income

Operating margin before depreciation and amortization was EUR 422 million in first half 2010, up 26.7% from EUR 333 million for the first half of 2009.

Operating margin was EUR 369 million compared with EUR 287 million for the same period in 2009, an increase of 28.6%.

Operating margin rate for the first half of the year was 14.5%, up from 13% for the same period in 2009. This reflects the significant upturn in activity as compared with first half 2009, and continued tight control over costs. The effects of measures taken in 2009, particularly with regard to containing personnel costs, are beginning to be felt.

Operating income for first half 2010 was EUR 353 million compared to EUR 257 million for the corresponding period in 2009, an increase of 37.4%.

Net income

Net income attributable to the Group was EUR 213 million, an increase of 27.5% on the net income of EUR 167 million reported for the first half of 2009.

Net income includes a net financial expense of EUR 42 million and a tax charge of EUR 89 million for the half-year.

Free Cash Flow

The Groupe’s free cash flow, excluding changes in WCR, was up sharply (+42% on the corresponding period of 2009) at EUR 277 million. The increase is directly linked to the increase in operating margin before depreciation and amortization.

Net financial debt at June 30, 2010

Net financial debt was EUR 618 million at June 30, 2010 compared to 899 EUR million at June 30, 2009. This figure includes the impact of the partial buyback of Publicis Groupe shares held by SEP Badinter-Dentsu at a cost of EUR 217.5 EUR million. Net financial debt at December 30, 2009 was EUR 313 million, the raise observed at June 30,2010 reflecting the usual seasonal effect.

The Groupe’s average net debt for the first half of 2010 was EUR 673 million, down sharply on the figures of EUR 1, 002 million for first half 2009 and EUR 929 million for the full year 2009.

The Groupe’s available liquidity position at June 30, 2010 was EUR 3.6 billion.

Shareholders’ equity at June 30, 2010

Consolidated shareholders’ including minority interests was EUR 3,111 million at June 30, 2010, compared with EUR 2,838 million at December 31, 2009. This includes the impact of allocation of 2009 income (dividends of EUR 107 million distributed).

The debt/equity ratio thus rose from 0.14 at December 31, 2009 to 0.20 at June 30, 2010.

II. NETWORKS

The upturn in advertising markets over the course of the first half of the year is benefiting all the Groupe’s networks. The growing contribution from digital activities, up to 28.1% of first half revenue compared with 20.7% (at 2010 exchange rate) for the first half of 2009, once again confirms the Groupe’s strategic decision to help its clients keep pace with a changing consumer landscape and the new digital audience. Digital activities are now making their way into every one of the Groupe’s networks, bringing the benefits of expertise and new ideas in virtually every area of digital operations, be it search, display, or the social and mobile networks made possible by the creation of the VivaKi Nerve Center (and at the same time avoiding duplication of investments).

III. COST CONTROL

The Groupe continues to exercise tight control over its costs. Cost optimization programs are the focus of unrelenting attention and are ongoing. The deployment of shared service centers, initiated some years ago, continues, as does the process of regionalization. The “Americas” platform, designed to serve the entire continent, is scheduled to go fully operational at the end of this year. The rollout (first local and subsequently global) of ERP, made possible by the integration of most agencies into shared service centers and the adoption of shared processes, continues. The Group expects to achieve a significant reduction in its operating costs from this investment, through global harmonization of processes and systems as from 2012.

Thanks to a solid balance sheet and improved cost control, the Groupe is well placed to meet market needs and sharpen its competitive edge.

IV. New BUSINESS: USD 2.1 BILLION IN NET wins

Publicis Groupe took in USD 2.1 billion in net new business in the first half of 2010, clear testimony to the attractiveness of its products and services (see Appendix for list).

V. ACQUISITIONS

Publicis Groupe has embarked on a process of securing long-term growth by ramping up its engagement in digital activities and emerging economies, both of which are growth drivers for the communications sector today and in the future.

A significant number of targets have been identified, with special interest focusing on the opportunities offered by China.

On March 30, Publicis Groupe announced it had acquired a minority stake in Taterka Comunicacoes (Taterka), an advertising agency based in Sao Paulo, Brazil.

On April 6, 2010, the Groupe acquired Canadian agency In-Sync. Founded in 1989, the Toronto-based agency operates in the health and wellness space, specializing in market research consultancy and offering innovative marketing solutions to its biopharma clients.

At the end of April, Publicis Groupe bought out the minority interests in W&K and holds now 100% of the capital of this Chinese agency, now rebranded Leo Burnett Beijing Communications Co., Ltd.

On May 19, 2010, Publicis Groupe acquired Resolute Communications Ltd. Founded in 2002, Resolute Communications provides healthcare communications programs spanning strategic consulting, medical education, and media and public relations. Resolute is headquartered in London with an office in New York. Resolute will be merged with Publicis Life Brands in London to form a new entity renamed Publicis Life Brands Resolute, that will further entrench Publicis Healthcare Communications Group (PHCG) as a leader in the United Kingdom.

VI. FINANCE

January 2010 saw the early redemption of some of the outstanding 2018 Oceane convertible bonds. According to the 2018 Oceane prospectus, any holder was entitled to request early redemption of all or part of its Oceane bonds at the early redemption price of EUR 45.19 per bond. At the early redemption date, i.e. January 18, 2010, a total of 617,985 Oceane bonds were repaid early for a total amount of EUR 28 million.

The number of Oceane bonds subsequently outstanding is 2,624,538, representing 14.9% of the number initially issued (17,624,521).

Furthermore, in view of the authorization granted by the Combined Annual General Meeting of the shareholders on June 9, 2009, Publicis Groupe SA entered into an agreement on January 8, 2010, with an authorized intermediary, with a view to purchasing 2.7 million Publicis Groupe shares. This authorization was granted for a period of eighteen months from June 9, 2009, i.e. until December 8, 2010. To date, 2,482,440 shares have been purchased under this program.

On May 10, 2010 Publicis Groupe purchased from Dentsu Inc. a block of 7,500,000 of its own shares, held by SEP Dentsu-Badinter, to be cancelled. The total price paid for the block was EUR 217.5 million, equivalent to EUR 29 per share. The shares were immediately cancelled.

VII. RECENT EVENTS

Acquisitions

On July 12, 2010, Publicis Groupe announced its acquisition of G4, a Beijing-based advertising agency. Launched in 2009, G4 offers integrated communications solutions, including advertising, design and strategic consulting, to Nestle in China. G4 has rebranded as Publicis G4 and will join forces with the Publicis Beijing Nestle team. Concentrating all the skills and resources dedicated to Nestle within Publicis G4 will provide an enhanced service to this key customer throughout Greater China and the Asia region.

New Business

New business maintained its dynamic pace at the beginning of second half 2010 after total gains of USD 1 billion for the second quarter.

VIII. Outlook

For the second time in succession, ZenithOptimedia has upgraded its forecasts of growth in global advertising expenditure for 2010, most recently to 3.5% growth. These significantly higher forecasts confirm the upturn in the market, after a year of record decline in global advertising expenditure in 2009.

Publicis Groupe’s growth rates for the first two quarters of 2010 are a mark of excellent performance and testimony to its judicious strategic choices, with digital activities continuing to expand across all the Groupe’s networks and creating the right conditions for innovation and value creation. Emerging economies are returning to growth rates more commensurate with their level of development and opening up new prospects for the Groupe.

These two cornerstones offer assurances of growth both now and in the future.

Investments in talent and in digital activities are still very much ongoing, made possible by strict cost control and a sound financial situation.

With many emerging economies, China in particular, returning to high growth, a recovering US economy (although flat since May), and certain European countries (including France and the UK) holding up well, Publicis Groupe confirms its target of outperforming the market on growth for full year 2010.

“This document contains forward-looking statements. The use of the words “aim(s),” “expect(s),” “feel(s),” “will,” “may,” “believe(s),” “anticipate(s)” and similar expressions in this press release are intended to identify those statements as forward looking. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Other than in connection with applicable securities laws, Publicis Groupe undertakes no obligation to publish revised forward-looking statements to reflect events or circumstances after the date of this press release or to reflect the occurrence of unanticipated events. Publicis Groupe urges you to review and consider the various disclosures it made concerning the factors that may affect its business carefully, including the disclosures made to the French financial authority (AMF)”

About Publicis Groupe

Publicis Groupe [Euronext Paris: FR0000130577] is the world’s third largest communications group. In addition, it is ranked as the world’s second largest media counsel and buying group, and is the first global network in digital and healthcare communications. With activities spanning 104 countries on five continents, the Groupe employs approximately 46,000 professionals. Publicis Groupe offers local and international clients a complete range of advertising services through three global advertising networks, Leo Burnett, Publicis, Saatchi & Saatchi, two multi-hub networks, Fallon and 49%-owned Bartle Bogle Hegarty, as well as New York-based Kaplan Thaler Group. Media consultancy and buying is offered through the two first ranked worldwide networks, Starcom MediaVest Group and ZenithOptimedia; and interactive and digital marketing led by the two first ranked Digitas and Razorfish networks. Publicis Groupe launched VivaKi to leverage the combined scale of the autonomous operations of Digitas, Denuo, Razorfish, Starcom MediaVest Group and ZenithOptimedia to develop new services, tools, and next generation digital platforms. Publicis Groupe’s specialized agencies and marketing services offer healthcare communications with Publicis Healthcare Communications Group (PHCG, the first network in healthcare communications), sustainability communications and multicultural communications. With MS&LGroup, one of the world’s top three PR and Events networks, expertise ranges from corporate and financial communications to public relations and public affairs, branding, social media marketing and events, sports marketing and events.

Web site: http://www.publicisgroupe.com
Appendices
New Business – 1st Half 2010
USD 2.1 billion (net)
Key wins
Digitas

Electronic Arts (Brazil), Topper (Brazil), CA (USA), Goodyear (USA), Aflac (USA), Sears (USA), Whitewave (USA), Olay (Hong Kong/ Taiwan), Airtel (India), Nestle (India), Renault ZE (France)

Fallon

Cadbury Flake (UK), French Connection (global), Nokia (global), The Cosmopolitan of Las Vegas. (USA), Cadillac (USA)

Leo Burnett

Chrysler (UK, Germany, Turkey), Samsung (Malaysia, Czech Republic, Thailand, Kazakhstan), COI/BIS (UK), Research in Motion- Blackberry (UK), DUFRY- duty free (Mexico), Sigma Alimentos (Mexico), Koleston (Colombia), Nestle (Guatemala), Sanofi-Aventis (Guatemala), Canon (Thailand), Amway (China), Siemens (China), Merrill Lynch (Korea), British Council (Sri Lanka), BMW (Malaysia), Pilipinas Shell (Philippines), Arla Food (Russia), Nycomed (Latvia), The ITI Group (Poland), Altıparmak (Turkey), El-Bi Electrics (Turkey), Turkcell (Turkey), Ulker (Turkey), Delipapier Sofidel (France), Campero (Guatemala, Salvador), V-Inspired (UK), Cemex (Costa Rica), World Gold Council (Turkey), Dubai International Film Festival, Tele2 (Kazakhstan), Fiat (Mexico), Cipher Lab (Taiwan)

MS&L Group

What’s on (India), World Gold Council (China), Central agency for national insurance (France), National Defense Ministry (France), Klepierre Segece (France), Pernod Ricard (France), RapidShare (Germany), Apoteket (Sweden)

Publicis Worldwide

Dolce Gusto (France, USA), Chrysler (Canada), City of Toronto (Canada), Metro (Canada), Siemens Energy (Germany, Asia), Telefonica / Movistar (Spain), Sky News / Online project (UK), Cafe do Brasil (Italy), Orogel (Italy), J.K. Helene Curtis (India), Reserve Bank of India / VIP Bags (India), SCMP Classified Post (Hong Kong), Le Monde (France), Ricola (France), Descamps (France), Carte d’Or (France), Cyrillus (France), GT Land Plaza (China), La Halle (France), Aeroports de la Cote d’Azur (France), Nestle / Dairy Culinary (Mexico), Bupa (UK), Concha y Toro / VCT (Brazil), Hamburger / Financial (Germany), Bud Light (Canada), Beefeater Gin (UK), Randstad (UK), Belle Avenue (Thailand), Black Canyon (Thailand), Wellcome / Social business (Germany), Emirates Airlines (Netherlands), Stivoro / Anti-smoking campaign (Netherlands), Musee du Louvre (France), Losc / Lille Football Club (France), Hammerson (France), Shanghai World Expo’s / Information & communication pavilion account, Virgin Mobile (Australia), City of Dreams / Digital account (Hong Kong), Indigo Books / Largest Canadian book retailer, (Canada), Hasbro (Canada), Canadian Olympic Foundation (Canada), Fiat / Punto Evo / International launch in Spain, Portugal, Netherlands, Belgium, Ireland, Poland ( France), BNP Paribas / Investment Partners (Netherlands), Nestle Maggi (Malaysia)

Saatchi & Saatchi

Arla Foods – Lurpak (Global except for UK), BNP Paribas (Poland), Red.es digital TV (Spain), Chrysler & Dodge SUV (China), Vinda (China), Carlsberg: Dali, Wusu, XiXia (China), Petrobras (Brazil), Sanitarium (New Zealand), Toyota (Italy)

Starcom MediaVest Group

Honda (Germany, Italy, Norway, Poland, Sweeden, UK), CBS Film (USA), Turner (USA), Napa Auto Parts (USA), Nintendo (Netherlands), Dutch Government (Netherlands), Van Haren (Netherlands), Silesia Voivodship (Poland), Ministry of Environment (Poland), Skyways (Sweeden), FEW Online Retail (Sweeden), Prudential Direct Insurance (Taiwan), Coca-Cola (France), Mitre 10 (Australia), Mars Wrigley (China), in.gr (Greece), General Mills (China), Supermac’s (Ireland), AIB (Ireland), IKKS (Netherlands), Provident (Poland), Aflac (USA), Avon (USA), Kraft/Cadbury (global), American Egg Board (USA)

The Kaplan Thaler group

Aflac (USA)

ZenithOptimedia

Aviva (global), Reckitt Benckiser (global), Beijing Tourism Board, China Merchant Bank, Maoduoli (China), Electrolux (Vietnam), Georgia Pacific (Romania), Vivartia (Romania), BN Telecom (Turkey), Dyo (Turkey), Pegasus Airlines (Turkey), SAB Miller (Ecuador), Axtel (Mexico), Lindt (United Arab Emirates), Catalonian Government (Spain), Ministry of Environment (Spain), Perfume Shop (UK), Remington Consumer Products (USA), Beijing Lan Hai Cold Mineral Water (China), Warner Bros (Singapore), Universal Pictures (Mexico), Hubei Mobile (China), Reckitt Benckiser (China), AS Watson (APAC)

Glossary

Operating margin rate: operating margin/revenue.

Average half-year net debt: half-year average of average monthly net debt.

Free cash flow: cash flow from operations minus capital expenditures for tangible and intangible fixed assets, excluding acquisitions.

Net new business: this figure is derived not from financial reporting but from estimated media-marketing budgets based on annual business (net of losses) from new and existing clients.

For further information, please visit our website: http://www.finance.publicisgroupe.com

2010 Press Releases

08/01/10 Share repurchase program

11/01/10 Partnership between the Women’s Forum and Terrafemina

18/01/10 OCEANES 2018 – early redemption

05/02/10 Lov Group and Publicis Groupe in exclusive negotiations

17/02/10 2009 Annual Results

16/03/10 Management Board bonuses

30/03/10 Publicis Groupe acquires a minority stake of Brazilian agency
Taterka Comunicacoes

06/04/10 Publicis Groupe Acquires In-Sync Healthcare Agency

22/04/10 Publicis Groupe: First Quarter 2010 Revenue – Back to Growth

26/04/10 Re-Elections at the Publicis Groupe Supervisory Board

29/04/10 Publicis Groupe Acquires Remaining Capital of Leo Burnett / W&K
Beijing Advertising Co. Ltd

10/05/10 Publicis Groupe Announces its Acquisition from Dentsu Inc. of
7,500,000 of its own Shares in Order to Cancel Them

19/05/10 Publicis Groupe acquires Resolute Communications, in Healthcare
Communications

01/06/10 Publicis Groupe Annual General Shareholders’ Meeting – Dividend
set at 0.60 Euros per Share

01/06/10 Supervisory Board and Management Board of Publicis Groupe

28/06/10 Daniele Bessis Joins Publicis Groupe as CEO of Re:Sources
Worldwide

12/07/10 Publicis Groupe Acquires G4 Advertising co. Ltd. in China

For further information: http://www.publicisgroupe.com

Publicis Groupe

Consolidated financial statements – June 30, 2010 (unaudited)

Consolidated income statement

(in millions of euros) June 30, June 30, 2009
2010 2009

Revenue 2,538 2,209 4,524
Personnel expenses (1,613) (1,423) (2,812)
Other operating expenses (503) (453) (940)
Operating margin before depreciation
and amortization 422 333 772
Depreciation and amortization expense
(excluding intangibles arising on
acquisition) (53) (46) (92)
Operating margin 369 287 680
Amortization of intangibles arising on
acquisition (17) (15) (30)
Impairment – (20) (28)
Non-current income (expense) 1 5 7
Operating income 353 257 629
Interest expense (40) (34) (73)
Interest income 6 9 12
Cost of net financial debt (34) (25) (61)
Other financial income (expenses) (8) (2) (9)
Income of consolidated companies before
taxes 311 230 559
Income taxes (89) (59) (146)
Net income of consolidated companies 222 171 413
Share in net income of associates – 1 4
Net income 222 172 417
Of which:

– Net income attributable to
non-controlling interests
(Minority interests) 9 5 14
– Net income attributable to equity
holders of the parent company 213 167 403

Per share data (in euros) – Net income
attributable to equity holders of the
parent company
Number of shares 204,545,563 200,760,562 202,257,125
Net earnings per share 1.04 0.83 1.99
Number of shares – diluted 237,073,116 206,261,458 220,867,344
Net earnings per share – diluted 0.95 0.82 1.90

Consolidated statement of comprehensive income

(in millions of euros) June 30, June 30, 2009
2010 2009

Net income for the year (a) 222 172 417
Other comprehensive income
– Valuation of available-for-sale
investments at fair value (1) 4 12
– Actuarial gains and losses on defined
benefit plans (24) (16) (4)
– Translation of foreign operations 431 (12) (59)
– Deferred taxes on other comprehensive
income 7 5 1
Other comprehensive income for the period
(b) 413 (19) (50)

Total comprehensive income for the period
(a) + (b) 635 153 367
Of which:

– Comprehensive income attributable to
non-controlling interests (Minority
interests) 18 7 17
– Comprehensive income attributable to
Equity holders of the parent company 617 146 350

Consolidated balance sheet

(in millions of euros) June 30, 2010 December 31, 2009

Assets
Goodwill, net 4,416 3,928
Intangible assets, net 937 835
Property and equipment, net 480 458
Deferred tax assets 96 73
Investments in associates 42 49
Other financial assets 113 94
Non-current assets 6,084 5,437
Inventory and costs billable to clients 406 290
Accounts receivable 5,941 4,875
Other receivables and other current assets 609 548
Cash and cash equivalents 1,418 1,580
Current assets 8,374 7,293

Total Assets 14,458 12,730

Liabilities and shareholders’ equity
Share capital 76 79
Additional paid-in capital and retained earnings 3,014 2,734
Equity attributable to holders of the
parent company 3,090 2,813
Non-controlling Interests (Minority interests) 21 25
Total Equity 3,111 2,838
Long-term financial debt (more than 1 year) 1,812 1,796
Deferred tax liabilities 235 214
Long-term provisions 499 449
Non-current liabilities 2,546 2,459
Accounts payable 6,858 5,835
Short-term financial debt (less than 1 year) 227 214
Income taxes payable 75 63
Short-term provisions 105 100
Other creditors and other current liabilities 1,536 1,221
Current liabilities 8,801 7,433

Total Liabilities and Equity 14,458 12,730

Consolidated cash flow statement

(in millions of euro) June 30, June 30, 2009
2010 2009
Cash flows from operations
Net income 222 172 417
Adjustment for non-cash income and
expenses:
Income taxes 89 59 146
Cost of net financial debt 34 25 61
Capital (gains) losses on disposal
(before tax) (1) (4) (10)
Depreciation, amortization and
impairment on property and equipment and
intangible assets 70 81 150
Non-cash expenses on stock options and
similar items 15 12 24
Other non-cash income and expenses 3 5 11
Equity in net income of associates – (1) (4)

Dividends received from equity accounted
investments 11 6 9
Taxes paid (103) (86) (157)
Interest paid (36) (51) (75)
Interest received 7 10 16
Change in working capital requirements(1) (266) (495) 59
Net cash flows provided by (used in)
operating activities (I) 45 (267) 647
Cash flows from investment operations
Purchases of property and equipment and
intangible assets (35) (33) (74)
Proceeds from sale of property and
equipment and intangible assets 1 – 10
Proceeds from sale of investments and
other financial assets, net (5) 3 10
Acquisition of subsidiaries (48) (70) (298)
Divestment of subsidiaries 1 – 1
Net cash flows provided by (used in)
investment operations (II) (86) (100) (351)
Cash flows from financing operations
Capital Increase – – -
Dividends paid to parent company
shareholders – – (107)
Dividends paid to minority shareholders
of subsidiaries (14) (15) (26)
Cash received on new borrowings 13 734 744
Reimbursement of borrowings (59) (115) (108)
Net (purchases)/sales of treasury shares
and equity warrants (249) 1 5
Cash received on hedging transactions – – -
Net cash flows provided by (used in)
financing operations (III) (309) 605 508
Impact of exchange rate fluctuations (IV) 173 34 (94)
Net change in consolidated cash flows (I
+ II + III + IV) (177) 272 710
Cash and cash equivalents as of January 1, 1,580 867 867
Bank overdrafts as of January 1, (33) (30) (30)
Net cash and cash equivalents at
beginning of period 1,547 837 837
Cash and cash equivalents at end of
period 1,418 1,162 1,580
Bank overdrafts at end of period (48) (53) (33)
Net cash and cash equivalents at end of
period 1,370 1,109 1,547
Net change in cash and cash equivalents (177) 272 710
(1) Breakdown of change in working
capital requirements
Change in inventory and costs billable
to clients (73) 31 29
Change in accounts receivable and other
receivables (458) 729 160
Change in accounts payable, other
creditors and provisions 265 (1,255) (130)
Variation in working capital
requirements (266) (495) 59

Statement of changes in consolidated shareholders’ equity

Number of (in millions of Capital Additional Reserves Translation
outstanding euros) stock paid-in and reserve
shares capital retained
earnings

178,854,301 January 1, 2009 78 2,553 (105) (315)
Net income for the 167
period
Other
comprehensive
income
Valuation of
available-for-sale
investments at
fair value
Actuarial gains (11)
and losses on
defined benefit
plans
Translation of (14)
foreign operations
Total other – – (11) (14)
comprehensive
income
Total – – 156 (14)
comprehensive
income for the
period

Equity component 49
of OCEANE 2014
Dividends (107)
Share-based 12
compensation
Additional (3)
interest on Oranes
Effect of changes
in scope of
consolidation and
of commitments to
purchase minority
interests
72,910 Purchases/sales of 1
treasury shares
178,927,211 June 30, 2009 78 2,553 3 (329)

Number of (in millions Fair-value Equity Non-Controlling Total
of outstanding euros) reserve attributable Interest Equity
shares to holders (Minority
of the interests)
parent
company

178,854,301 January 1, 2009 109 2,320 30 2,350
Net income for the 167 5 172
period
Other
comprehensive
income
Valuation of 4 4 4
available-for-sale
investments at
fair value
Actuarial gains (11) (11)
and losses on
defined benefit
plans
Translation of (14) 2 (12)
foreign operations
Total other 4 (21) 2 (19)
comprehensive
income
Total 4 146 7 153
comprehensive
income for the
period

Equity component 49 49
of OCEANE 2014
Dividends (107) (15) (122)
Share-based 12 12
compensation
Additional (3) (3)
interest on Oranes
Effect of changes – 3 3
in scope of
consolidation and
of commitments to
purchase minority
interests
72,910 Purchases/sales of 1 1
treasury shares
178,927,211 June 30, 2009 113 2,418 25 2,443

Number of (in millions of Capital Additional Reserves Translation
outstanding euros) stock paid-in and reserve
shares capital retained
earnings

187,168,768 January 1, 2010 79 2,600 390 (377)
Net income 213
Other
comprehensive
income
Valuation of
available-for-sale
investments at
fair value
Actuarial gains (17)
and losses on
defined benefit
plans
Translation of 422
foreign operations
Total other – – (17) 422
comprehensive
income
Total – – 196 422
comprehensive
income for the
period

Dividends paid (107)
Share-based 19
compensation
Additional (3)
interest on Oranes
Effect of changes
in scope of
consolidation and
of commitments to
purchase minority
interests
(7,500,000) Cancellation of (3) (215)
Publics Groupe SA
shares
(807,764) Purchases/sales of (31)
treasury shares
178,861,004 June 30, 2010 76 2,385 464 45

Number of (in millions Fair-value Equity Non-Controlling Total
of outstanding euros) reserve attributable Interests Equity
shares to holders (Minority
of the interests)
parent
company

187,168,768 January 1, 2010 121 2,813 25 2,838
Net income 213 9 222
Other
comprehensive
income
Valuation of (1) (1) (1)
available-for-sale
investments at
fair value
Actuarial gains (17) (17)
and losses on
defined benefit
plans
Translation of 422 9 431
foreign operations
Total other (1) 404 9 413
comprehensive
income
Total (1) 617 18 635
comprehensive
income for the
period

Dividends paid (107) (14) (121)
Share-based 19 19
compensation
Additional (3) (3)
interest on Oranes
Effect of changes
in scope of
consolidation and
of commitments to
purchase minority
interests – (8) (8)
(7,500,000) Cancellation of (218) (218)
Publics Groupe SA
shares
(807,764) Purchases/sales of (31) (31)
treasury shares
178,861,004 June 30, 2010 120 3,090 21 3,111

Earnings per share calculation details

Earnings per share and diluted earnings per share

(In millions of euro except for shares) June 30, 2010 June 30, 2009
Net income used for the calculation of
earnings per share
Net income attributable to equity holders
of the parent a 213 167
Impact of dilutive instruments:
– Savings in financial expenses related
to the conversion of debt instruments,
net of tax (1) 13 2
Net income attributable to equity holders
of the parent – diluted b 226 169
Number of shares used for the calculation
of earnings per share
Average number of shares composing the
company’s share capital 195,469,852 196,020,983
Treasury shares to be deducted (average
for the year) (11,231,966) (17,130,227)
Shares to be issued to redeem the Oranes 20,307,677 21,869,806
Average number of shares used for the
calculation c 204,545,563 200,760,562
Impact of dilutive instruments: (2)
– Free shares and dilutive stock options 3,904,161 1,045,823
– Equity warrants (BSA) 172,692 -
– Shares resulting from the conversion of
convertible bonds (1) 28,450,700 4,455,073
Number of shares – diluted
(en euro) d 237,073,116 206,261,458

Net earnings per share a/c 1.04 0.83

Net earnings per share – diluted b/d 0.95 0.82

(1) In 2010 and 2009, both Oceane 2018 and Oceane 2014 were taken into account for the calculations (the Oceane 2014, issued in June 2009, was only included for one month for the first semester 2009).

(2) Only stock-options and equity warrants with a dilutive effect (whose exercise price is lower than the average share price for the period) are taken into consideration.

Headline earnings per share and diluted earnings per share

(In millions of euro except for shares) June 30, 2010 June 30, 2009
Net income used for the calculation of
headline earnings per share (1)
Net income attributable to equity holders
of the parent 213 167
Items excluded:
– Amortization of intangibles arising on
acquisition, net of tax 10 9
– Impairment, net of tax – 16
– Deferred tax asset linked to Oceane 2014(2) – (11)

Headline income attributable to equity
holders of the parent e 223 181
Impact of dilutive instruments:
– Savings in financial expenses related to
the conversion of debt instruments, net of
tax 13 2
Adjusted net income attributable to equity f
holders of the parent – diluted 236 183

Number of shares used for the calculation
of earnings per share
Average number of shares composing the
company’s share capital 195,469,852 196,020,983
Treasury shares to be deducted (average
for the year) (11,231,966) (17,130,227)
Shares to be issued to redeem the Oranes 20,307,677 21,869,806
Average number of shares used for the
calculation c 204,545,563 200,760,562
Impact of dilutive instruments:
– Free shares and dilutive stock options 3,904,161 1,045,823
– Equity warrants (BSA) 172,692 -
– Shares resulting from the conversion of
convertible bonds 28,450,700 4,455,073
Number of shares – diluted
(in euro) d 237,073,116 206,261,458

Headline earnings per share (1) e/c 1.09 0.90

Headline earnings per share – diluted (1) f/d 1.00 0.89

(1) Earnings per share before Amortization of intangibles from acquisitions, impairment and deferred tax assets linked to equity component of Oceane 2014.

(2) Effect of deferred tax asset recognized against deferred tax liabilities linked to equity component of Oceane 2014 recorded as equity.

SOURCE Publicis Groupe

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Publicis Groupe: First Half 2010 Results

July 30, 2010 By Leave a Comment

http://www.businesswire.com/news/home/20100728007270/en

PARIS–(Business Wire)–
Regulatory News:

Second quarter 2010 (EUR million)

* Revenue1,376 (+21.3%)
* Organic growth+7.1%

First half 2010 (EUR million)

* Revenue2,538 (+14.9%)
* Organic growth+5.3%
* Operating margin369 (+28.6%)
* Operating margin rate14.5%
* Net income (Group share) 213 (+27.5%)
* Free Cash Flow (1)277(+42%)
* Headline diluted EPS (2) 1.00 euro (+12%)
* Debt/equity ratio0.20

(1)Before changes in WCR

(2)After elimination of impairment, amortization of intangibles arising on
acquisitions and the tax credit arising on the deferred tax liability on the
Oceane 2014 convertible bond.

Maurice Lévy, Chairman and Chief Executive Officer of Publicis Groupe declares:

“With organic growth of 7.1% for the second quarter of 2010 and 5.3% for the
half-year, an operating margin of 14.5% and net income up by 27.5%, Publicis
Groupe has once again given proof of its energy and ability to create value,
even in the aftermath of the worst global economic crisis in many years.

This growth is the result of a strategy that has been effectively executed over
a number of years. We were quick to take the digital route, gaining a decisive
lead over our competitors and providing clients with the best and most
innovative solutions for the new landscape being shaped by the explosion of
digital technology.

We also opted for expansion in emerging markets. The economic crisis may have
slowed the pace of their growth, but ZenithOptimedia`s latest estimates for 2011
and 2012 bode well for strong growth.

The challenges our clients face demand from us greater inventiveness, creativity
and innovation, and relentless operational efforts to ensure that they win
whatever the circumstances. I would like to thank them for their confidence, and
to pay tribute to the hard work of all our teams who have performed wonders
within the constraints of strict cost controls, enabling Publicis Groupe to
emerge stronger than ever from the crisis.

Tight cost containment since end 2008 and strong growth in revenue have boosted
operating margin to an impressive 14.5%, despite the fact that Razorfish is
still in the integration phase with a margin that, while improving, is still
well below average for the Groupe.

Without lapsing into the euphoria that these half-year results for our Groupe
might warrant, I remain firmly convinced that Publicis Groupe will succeed in
outperforming the market in terms of both growth and margin.”

***

At its meeting on July 28, 2010, chaired by Ms. Elisabeth Badinter, the
Supervisory Board of Publicis Groupe (Paris:PUB) examined the first half results
for 2010 presented by Mr. Maurice Lévy, Chairman and Chief Executive Officer of
Publicis Groupe.

Key figures

EUR million, except for percentages and per-share data (EUR) 1st half 2010 1st half 2009 2010/2009
Income statement data
Revenue 2,538 2,209 14.9%
Operating margin before depreciation and amortization 422 333 26.7%
As % of revenue 16.6% 15.1%
Operating margin 369 287 28.6%
As % of revenue 14.5% 13.0%
Operating income 353 257 37.4%
Net income attributable to Publicis Groupe 213 167 27.5%
Earnings per share (1) 1.04 0.83 25.3%
Diluted earnings per share (2) 0.95 0.82 15.8%
Balance sheet data June 30, 2010 June 30, 2009
Total assets 14,458 11,408
Shareholders` equity 3,090 2,418

(1)The average number of shares used to calculate earnings per share was 204.5
million for 1st Half 2010 and 200.8 million for 1st Half 2009.

(2)The average number of shares used to calculate diluted earnings per share was
237.1 million for 1st Half 2010 and 206.3 million for 1st Half 2009. This
includes stock options, free shares, equity warrants and convertible bonds with
a dilutive effect on EPS. For the first six months of 2010, the instruments that
diluted EPS were the Oceane convertible bonds, equity warrants, free shares and
certain tranches of stock options with a strike price below the average price
over the period.

Analysis of key figures

I.First half 2010 activity

The global economy rallied over the first half of 2010. After forecasting a 0.9%
increase in 2010 global advertising expenditure in its December 2009 forecast,
ZenithOptimedia upgraded its forecast in April this year to 2.2% growth and
upped its latest estimate yet again, on July 19, to 3.5%. This steady
improvement in growth forecasts is most encouraging.

As the advertising market recovered, Publicis Groupe posted an increase of 14.9%
in reported revenue for the first half and organic growth of +5.3%.

Second quarter revenue was up by 21.3% and organic growth rose to 7.1%.

* Revenue in first half 2010

Consolidated revenue for the first half of 2010 was EUR 2,538 million compared
to EUR 2,209 million for the first half of 2009, an increase of 14.9% (exchange
rate impact was positive at EUR 55 million).

Organic growth was 5.3%.

First half growth reflects the strong recovery in advertising expenditure after
the record slump triggered by the 2009 economic crisis. The larger networks, in
particular Leo Burnett and Publicis Worldwide along with VivaKi, made the most
of the upturn, and digital activities maintained their strong growth trend.

The breakdown of consolidated revenue for the first half of 2010 is as follows:
33% from advertising, 20% from media and 47% from specialized agencies and
marketing services (including digital activities).

- Breakdown of first half 2010 revenue by region

(EUR million) Revenue Organic Growth
1st half 2010 1st half 2009
Europe 805 738 +3.1%
North America 1,258 1,061 +6.6%
Asia-Pacific 286 238 +6.0%
Latin America 126 109 +10.8%
Africa and Middle East 63 63 -3.3%
Total 2,538 2,209 +5.3%

Almost all the regions, Europe included, saw a return to growth, with the
exception of Africa and the Middle East, which is still suffering from Dubai`s
financial crisis.

North America continues to enjoy good growth. Organic growth for the USA was
7.2%, fuelled by strong growth from all the agencies and significant
contributions from the healthcare and digital activities, the latter accounting
for 42.5% of the region`s revenue.

The Asia Pacific region is growing again, thanks largely to India and Korea.

Every country in Latin America except Chile reported growth.

Expressed in US dollars, first half revenue was USD 3,362 million, an increase
of 14.3%.

* Revenue in 2nd quarter 2010

Consolidated second quarter 2010 revenue was EUR 1,376 million, an increase of
21.3% on the figure of EUR 1,134 million for the corresponding period in 2009
(the exchange rate impact was positive at EUR 73 million).

Organic growth was +7.1% in the second quarter, a significant improvement on
first quarter organic growth of +3.1%.

The second quarter undoubtedly benefited from a low basis of comparison, but the
marked upswing in advertising business seen in the first quarter was also
maintained.

Growth was also fuelled by new business wins in 2009 and by an increase in
advertising spending by major clients.

- Breakdown of 2nd quarter 2010 revenue by region

(EUR million) Revenue Organic Growth
2nd quarter 2010 2nd quarter 2009
Europe 437 381 +7.3%
North America 679 535 +8.1%
Asia-Pacific 154 123 +5.3%
Latin America 71 58 +11.5%
Africa and Middle East 35 37 -10.4%
Total 1,376 1,134 +7.1%

Europe performed well in the second quarter. Only Africa and the Middle East
posted negative figures.

Operating margin and operating income

Operating margin before depreciation and amortization was EUR 422 million in
first half 2010, up 26.7% from EUR 333 million for the first half of 2009.

Operating margin was EUR 369 million compared with EUR 287 million for the same
period in 2009, an increase of 28.6%.

Operating margin rate for the first half of the year was 14.5%, up from 13% for
the same period in 2009. This reflects the significant upturn in activity as
compared with first half 2009, and continued tight control over costs. The
effects of measures taken in 2009, particularly with regard to containing
personnel costs, are beginning to be felt.

Operating income for first half 2010 was EUR 353 million compared to EUR 257
million for the corresponding period in 2009, an increase of 37.4%.

Net income

Net income attributable to the Group was EUR 213 million, an increase of 27.5%
on the net income of EUR 167 million reported for the first half of 2009.

Net income includes a net financial expense of EUR 42 million and a tax charge
of EUR 89 million for the half-year.

Free Cash Flow

The Groupe`s free cash flow, excluding changes in WCR, was up sharply (+42% on
the corresponding period of 2009) at EUR 277 million. The increase is directly
linked to the increase in operating margin before depreciation and amortization.

Net financial debt at June 30, 2010

Net financial debt was EUR 618 million at June 30, 2010 compared to 899 EUR
million at June 30, 2009. This figure includes the impact of the partial buyback
of Publicis Groupe shares held by SEP Badinter-Dentsu at a cost of EUR 217.5 EUR
million. Net financial debt at December 30, 2009 was EUR 313 million, the raise
observed at June 30,2010 reflecting the usual seasonal effect.

The Groupe`s average net debt for the first half of 2010 was EUR 673 million,
down sharply on the figures of EUR 1, 002 million for first half 2009 and EUR
929 million for the full year 2009.

The Groupe`s available liquidity position at June 30, 2010 was EUR 3.6 billion.

Shareholders` equity at June 30, 2010

Consolidated shareholders` including minority interests was EUR 3,111 million at
June 30, 2010, compared with EUR 2,838 million at December 31, 2009. This
includes the impact of allocation of 2009 income (dividends of EUR 107 million
distributed).

The debt/equity ratio thus rose from 0.14 at December 31, 2009 to 0.20 at June
30, 2010.

II.NETWORKS

The upturn in advertising markets over the course of the first half of the year
is benefiting all the Groupe`s networks. The growing contribution from digital
activities, up to 28.1% of first half revenue compared with 20.7% (at 2010
exchange rate) for the first half of 2009, once again confirms the Groupe`s
strategic decision to help its clients keep pace with a changing consumer
landscape and the new digital audience. Digital activities are now making their
way into every one of the Groupe`s networks, bringing the benefits of expertise
and new ideas in virtually every area of digital operations, be it search,
display, or the social and mobile networks made possible by the creation of the
VivaKi Nerve Center (and at the same time avoiding duplication of investments).

III.COST CONTROL

The Groupe continues to exercise tight control over its costs. Cost optimization
programs are the focus of unrelenting attention and are ongoing. The deployment
of shared service centers, initiated some years ago, continues, as does the
process of regionalization. The “Americas” platform, designed to serve the
entire continent, is scheduled to go fully operational at the end of this year.
The rollout (first local and subsequently global) of ERP, made possible by the
integration of most agencies into shared service centers and the adoption of
shared processes, continues. The Group expects to achieve a significant
reduction in its operating costs from this investment, through global
harmonization of processes and systems as from 2012.

Thanks to a solid balance sheet and improved cost control, the Groupe is well
placed to meet market needs and sharpen its competitive edge.

IV.NEW BUSINESS: USD 2.1 BILLION IN NET WINS

Publicis Groupe took in USD 2.1 billion in net new business in the first half of
2010, clear testimony to the attractiveness of its products and services (see
Appendix for list).

V.ACQUISITIONS

Publicis Groupe has embarked on a process of securing long-term growth by
ramping up its engagement in digital activities and emerging economies, both of
which are growth drivers for the communications sector today and in the future.

A significant number of targets have been identified, with special interest
focusing on the opportunities offered by China.

On March 30, Publicis Groupe announced it had acquired a minority stake in
Taterka Comunicações (Taterka), an advertising agency based in São Paulo,
Brazil.

On April 6, 2010, the Groupe acquired Canadian agency In-Sync. Founded in 1989,
the Toronto-based agency operates in the health and wellness space, specializing
in market research consultancy and offering innovative marketing solutions to
its biopharma clients.

At the end of April, Publicis Groupe bought out the minority interests in W&K
and holds now 100% of the capital of this Chinese agency, now rebranded Leo
Burnett Beijing Communications Co., Ltd.

On May 19, 2010, Publicis Groupe acquired Resolute Communications Ltd. Founded
in 2002, Resolute Communications provides healthcare communications programs
spanning strategic consulting, medical education, and media and public
relations. Resolute is headquartered in London with an office in New York.
Resolute will be merged with Publicis Life Brands in London to form a new entity
renamed Publicis Life Brands Resolute, that will further entrench Publicis
Healthcare Communications Group (PHCG) as a leader in the United Kingdom.

VI.FINANCE

January 2010 saw the early redemption of some of the outstanding 2018 Oceane
convertible bonds. According to the 2018 Oceane prospectus, any holder was
entitled to request early redemption of all or part of its Oceane bonds at the
early redemption price of EUR 45.19 per bond. At the early redemption date, i.e.
January 18, 2010, a total of 617,985 Oceane bonds were repaid early for a total
amount of EUR 28 million.

The number of Oceane bonds subsequently outstanding is 2,624,538, representing
14.9% of the number initially issued (17,624,521).

Furthermore, in view of the authorization granted by the Combined Annual General
Meeting of the shareholders on June 9, 2009, Publicis Groupe SA entered into an
agreement on January 8, 2010, with an authorized intermediary, with a view to
purchasing 2.7 million Publicis Groupe shares. This authorization was granted
for a period of eighteen months from June 9, 2009, i.e. until December 8, 2010.
To date, 2,482,440 shares have been purchased under this program.

On May 10, 2010 Publicis Groupe purchased from Dentsu Inc. a block of 7,500,000
of its own shares, held by SEP Dentsu-Badinter, to be cancelled. The total price
paid for the block was EUR 217.5 million, equivalent to EUR 29 per share. The
shares were immediately cancelled.

VII.RECENT EVENTS

Acquisitions

On July 12, 2010, Publicis Groupe announced its acquisition of G4, a
Beijing-based advertising agency. Launched in 2009, G4 offers integrated
communications solutions, including advertising, design and strategic
consulting, to Nestlé in China. G4 has rebranded as Publicis G4 and will join
forces with the Publicis Beijing Nestlé team. Concentrating all the skills and
resources dedicated to Nestlé within Publicis G4 will provide an enhanced
service to this key customer throughout Greater China and the Asia region.

New Business

New business maintained its dynamic pace at the beginning of second half 2010
after total gains of USD 1 billion for the second quarter.

VIII.Outlook

For the second time in succession, ZenithOptimedia has upgraded its forecasts of
growth in global advertising expenditure for 2010, most recently to 3.5% growth.
These significantly higher forecasts confirm the upturn in the market, after a
year of record decline in global advertising expenditure in 2009.

Publicis Groupe`s growth rates for the first two quarters of 2010 are a mark of
excellent performance and testimony to its judicious strategic choices, with
digital activities continuing to expand across all the Groupe`s networks and
creating the right conditions for innovation and value creation. Emerging
economies are returning to growth rates more commensurate with their level of
development and opening up new prospects for the Groupe.

These two cornerstones offer assurances of growth both now and in the future.

Investments in talent and in digital activities are still very much ongoing,
made possible by strict cost control and a sound financial situation.

With many emerging economies, China in particular, returning to high growth, a
recovering US economy (although flat since May), and certain European countries
(including France and the UK) holding up well, Publicis Groupe confirms its
target of outperforming the market on growth for full year 2010.

***

“This document contains forward-looking statements. The use of the words
“aim(s),” “expect(s),” “feel(s),” “will,” “may,” “believe(s),” “anticipate(s)”
and similar expressions in this press release are intended to identify those
statements as forward looking. Forward-looking statements are subject to risks
and uncertainties that could cause actual results to differ materially from
those projected. You should not place undue reliance on these forward-looking
statements, which speak only as of the date of this press release. Other than in
connection with applicable securities laws, Publicis Groupe undertakes no
obligation to publish revised forward-looking statements to reflect events or
circumstances after the date of this press release or to reflect the occurrence
of unanticipated events. Publicis Groupe urges you to review and consider the
various disclosures it made concerning the factors that may affect its business
carefully, including the disclosures made to the French financial authority
(AMF)”

About Publicis Groupe

Publicis Groupe [Euronext Paris: FR0000130577] is the world’s third largest
communications group. In addition, it is ranked as the world`s second largest
media counsel and buying group, and is the first global network in digital and
healthcare communications. With activities spanning 104 countries on five
continents, the Groupe employs approximately 46,000 professionals. Publicis
Groupe offers local and international clients a complete range of advertising
services through three global advertising networks, Leo Burnett, Publicis,
Saatchi & Saatchi, two multi-hub networks, Fallon and 49%-owned Bartle Bogle
Hegarty, as well as New York-based Kaplan Thaler Group. Media consultancy and
buying is offered through the two first ranked worldwide networks, Starcom
MediaVest Group and ZenithOptimedia; and interactive and digital marketing led
by the two first ranked Digitas and Razorfish networks. Publicis Groupe launched
VivaKi to leverage the combined scale of the autonomous operations of Digitas,
Denuo, Razorfish, Starcom MediaVest Group and ZenithOptimedia to develop new
services, tools, and next generation digital platforms. Publicis Groupe`s
specialized agencies and marketing services offer healthcare communications with
Publicis Healthcare Communications Group (PHCG, the first network in healthcare
communications), sustainability communications and multicultural communications.
With MS&LGroup, one of the world’s top three PR and Events networks, expertise
ranges from corporate and financial communications to public relations and
public affairs, branding, social media marketing and events, sports marketing
and events.

Web site: www.publicisgroupe.com

*******

Appendices

New Business – 1st Half 2010
USD 2.1 billion (net)

KEY WINS

DIGITAS
Electronic Arts (Brazil), Topper (Brazil), CA (USA), Goodyear (USA), Aflac
(USA), Sears (USA), Whitewave (USA), Olay (Hong Kong/ Taiwan), Airtel (India),
Nestle (India), Renault ZE (France)

FALLON
Cadbury Flake (UK), French Connection (global), Nokia (global), The Cosmopolitan
of Las Vegas. (USA), Cadillac (USA)

LEO BURNETT
Chrysler (UK, Germany, Turkey), Samsung (Malaysia, Czech Republic, Thailand,
Kazakhstan), COI/BIS (UK), Research in Motion- Blackberry (UK), DUFRY- duty free
(Mexico), Sigma Alimentos (Mexico), Koleston (Colombia), Nestlé (Guatemala),
Sanofi-Aventis (Guatemala), Canon (Thailand), Amway (China), Siemens (China),
Merrill Lynch (Korea), British Council (Sri Lanka), BMW (Malaysia), Pilipinas
Shell (Philippines), Arla Food (Russia), Nycomed (Latvia), The ITI Group
(Poland), Altıparmak (Turkey), El-Bi Electrics (Turkey), Turkcell (Turkey),
Ülker (Turkey), Delipapier Sofidel (France), Campero (Guatemala, Salvador),
V-Inspired (UK), Cemex (Costa Rica), World Gold Council (Turkey), Dubai
International Film Festival, Tele2 (Kazakhstan), Fiat (Mexico), Cipher Lab
(Taiwan)

MS&L GROUP
What`s on (India), World Gold Council (China), Central agency for national
insurance (France), National Defense Ministry (France), Klépierre Ségécé
(France), Pernod Ricard (France), RapidShare (Germany), Apoteket (Sweden)

PUBLICIS WORLDWIDE
Dolce Gusto (France, USA), Chrysler (Canada), City of Toronto (Canada), Metro
(Canada), Siemens Energy (Germany, Asia), Telefonica / Movistar (Spain), Sky
News / Online project (UK), Cafè do Brasil (Italy), Orogel (Italy), J.K. Helene
Curtis (India), Reserve Bank of India / VIP Bags (India), SCMP Classified Post
(Hong Kong), Le Monde (France), Ricola (France), Descamps (France), Carte d’Or
(France), Cyrillus (France), GT Land Plaza (China), La Halle (France), Aéroports
de la Cote d’Azur (France), Nestlé / Dairy Culinary (Mexico), Bupa (UK), Concha
y Toro / VCT (Brazil), Hamburger / Financial (Germany), Bud Light (Canada),
Beefeater Gin (UK), Randstad (UK), Belle Avenue (Thailand), Black Canyon
(Thailand), Wellcome / Social business (Germany), Emirates Airlines
(Netherlands), Stivoro / Anti-smoking campaign (Netherlands), Musée du Louvre
(France), Losc / Lille Football Club (France), Hammerson (France), Shanghai
World Expo’s / Information & communication pavilion account, Virgin Mobile
(Australia), City of Dreams / Digital account (Hong Kong), Indigo Books /
Largest Canadian book retailer, (Canada), Hasbro (Canada), Canadian Olympic
Foundation (Canada), Fiat / Punto Evo / International launch in Spain, Portugal,
Netherlands, Belgium, Ireland, Poland ( France), BNP Paribas / Investment
Partners (Netherlands), Nestlé Maggi (Malaysia)

SAATCHI & SAATCHI
Arla Foods – Lurpak (Global except for UK), BNP Paribas (Poland), Red.es digital
TV (Spain), Chrysler & Dodge SUV (China), Vinda (China), Carlsberg: Dali, Wusu,
XiXia (China), Petrobras (Brazil), Sanitarium (New Zealand), Toyota (Italy)

STARCOM MEDIAVEST GROUP
Honda (Germany, Italy, Norway, Poland, Sweeden, UK), CBS Film (USA), Turner
(USA), Napa Auto Parts (USA), Nintendo (Netherlands), Dutch Government
(Netherlands), Van Haren (Netherlands), Silesia Voivodship (Poland), Ministry of
Environment (Poland), Skyways (Sweeden), FEW Online Retail (Sweeden), Prudential
Direct Insurance (Taiwan), Coca-Cola (France), Mitre 10 (Australia), Mars
Wrigley (China), in.gr (Greece), General Mills (China), Supermac’s (Ireland),
AIB (Ireland), IKKS (Netherlands), Provident (Poland), Aflac (USA), Avon (USA),
Kraft/Cadbury (global), American Egg Board (USA)

THE KAPLAN THALER GROUP
Aflac (USA)

ZENITHOPTIMEDIA
Aviva (global), Reckitt Benckiser (global), Beijing Tourism Board, China
Merchant Bank, Maoduoli (China), Electrolux (Vietnam), Georgia Pacific
(Romania), Vivartia (Romania), BN Telecom (Turkey), Dyo (Turkey), Pegasus
Airlines (Turkey), SAB Miller (Ecuador), Axtel (Mexico), Lindt (United Arab
Emirates), Catalonian Government (Spain), Ministry of Environment (Spain),
Perfume Shop (UK), Remington Consumer Products (USA), Beijing Lan Hai Cold
Mineral Water (China), Warner Bros (Singapore), Universal Pictures (Mexico),
Hubei Mobile (China), Reckitt Benckiser (China), AS Watson (APAC)

*******

Glossary

Operating margin rate: operating margin/revenue.

Average half-year net debt: half-year average of average monthly net debt.

Free cash flow: cash flow from operations minus capital expenditures for
tangible and intangible fixed assets, excluding acquisitions.

Net new business: this figure is derived not from financial reporting but from
estimated media-marketing budgets based on annual business (net of losses) from
new and existing clients.

For further information, please visit our website:
www.finance.publicisgroupe.com

*******

2010 Press Releases

08/01/10 Share repurchase program
11/01/10 Partnership between the Women`s Forum and Terrafemina
18/01/10 OCEANES 2018 – early redemption
05/02/10 Lov Group and Publicis Groupe in exclusive negotiations
17/02/10 2009 Annual Results
16/03/10 Management Board bonuses
30/03/10 Publicis Groupe acquires a minority stake of Brazilian agency Taterka Comunicações
06/04/10 Publicis Groupe Acquires In-Sync Healthcare Agency
22/04/10 Publicis Groupe: First Quarter 2010 Revenue – Back to Growth
26/04/10 Re-Elections at the Publicis Groupe Supervisory Board
29/04/10 Publicis Groupe Acquires Remaining Capital of Leo Burnett / W&K Beijing Advertising Co. Ltd
10/05/10 Publicis Groupe Announces its Acquisition from Dentsu Inc. of 7,500,000 of its own Shares in Order to Cancel Them
19/05/10 Publicis Groupe acquires Resolute Communications, in Healthcare Communications
01/06/10 Publicis Groupe Annual General Shareholders’ Meeting – Dividend set at 0.60 Euros per Share
01/06/10 Supervisory Board and Management Board of Publicis Groupe
28/06/10 Danièle Bessis Joins Publicis Groupe as CEO of Re:Sources Worldwide
12/07/10 Publicis Groupe Acquires G4 Advertising co. Ltd. in China

For further information: www.publicisgroupe.com

Publicis Groupe

Consolidated financial statements – June 30, 2010 (unaudited)

Consolidated income statement

(in millions of euros) June 30, 2010 June 30, 2009 2009
Revenue 2,538 2,209 4,524
Personnel expenses (1,613) (1,423) (2,812)
Other operating expenses (503) (453) (940)
Operating margin before depreciation and amortization 422 333 772
Depreciation and amortization expense (excluding intangibles arising on acquisition) (53) (46) (92)
Operating margin 369 287 680
Amortization of intangibles arising on acquisition (17) (15) (30)
Impairment – (20) (28)
Non-current income (expense) 1 5 7
Operating income 353 257 629
Interest expense (40) (34) (73)
Interest income 6 9 12
Cost of net financial debt (34) (25) (61)
Other financial income (expenses) (8) (2) (9)
Income of consolidated companies before taxes 311 230 559
Income taxes (89) (59) (146)
Net income of consolidated companies 222 171 413
Share in net income of associates – 1 4
Net income 222 172 417
Of which: 9 5 14
– Net income attributable to non-controlling interests
(Minority interests)
– Net income attributable to equity holders of the parent company 213 167 403

Per share data (in euros) – Net income attributable to equity holders of the parent company
Number of shares 204,545,563 200,760,562 202,257,125
Net earnings per share 1.04 0.83 1.99
Number of shares – diluted 237,073,116 206,261,458 220,867,344
Net earnings per share – diluted 0.95 0.82 1.90

Consolidated statement of comprehensive income

(in millions of euros) June 30, 2010 June 30, 2009 2009
Net income for the year (a) 222 172 417
Other comprehensive income
– Valuation of available-for-sale investments at fair value (1) 4 12
– Actuarial gains and losses on defined benefit plans (24) (16) (4)
– Translation of foreign operations 431 (12) (59)
– Deferred taxes on other comprehensive income 7 5 1
Other comprehensive income for the period (b) 413 (19) (50)

Total comprehensive income for the period (a) + (b) 635 153 367
Of which: 18 7 17

- Comprehensive income attributable to non-controlling interests
(Minority interests)
– Comprehensive income attributable to Equity holders of the parent company 617 146 350

Consolidated balance sheet

(in millions of euros) June 30, 2010 December 31, 2009
Assets
Goodwill, net 4,416 3,928
Intangible assets, net 937 835
Property and equipment, net 480 458
Deferred tax assets 96 73
Investments in associates 42 49
Other financial assets 113 94
Non-current assets 6,084 5,437
Inventory and costs billable to clients 406 290
Accounts receivable 5,941 4,875
Other receivables and other current assets 609 548
Cash and cash equivalents 1,418 1,580
Current assets 8,374 7,293

Total Assets 14 ,458 12,730

Liabilities and shareholders` equity
Share capital 76 79
Additional paid-in capital and retained earnings 3,014 2,734
Equity attributable to holders of the parent company 3,090 2,813
Non-controlling Interests (Minority interests) 21 25
Total Equity 3,111 2,838
Long-term financial debt (more than 1 year) 1,812 1,796
Deferred tax liabilities 235 214
Long-term provisions 499 449
Non-current liabilities 2,546 2,459
Accounts payable 6,858 5,835
Short-term financial debt (less than 1 year) 227 214
Income taxes payable 75 63
Short-term provisions 105 100
Other creditors and other current liabilities 1,536 1,221
Current liabilities 8,801 7,433

Total Liabilities and Equity 14,458 12,730

Consolidated cash flow statement

(in millions of euro) June 30, 2010 June 30, 2009 2009
Cash flows from operations
Net income 222 172 417
Adjustment for non-cash income and expenses:
Income taxes 89 59 146
Cost of net financial debt 34 25 61
Capital (gains) losses on disposal (before tax) (1) (4) (10)
Depreciation, amortization and impairment on property and equipment and intangible assets 70 81 150
Non-cash expenses on stock options and similar items 15 12 24
Other non-cash income and expenses 3 5 11
Equity in net income of associates – (1) (4)

Dividends received from equity accounted investments 11 6 9
Taxes paid (103) (86) (157)
Interest paid (36) (51) (75)
Interest received 7 10 16
Change in working capital requirements (1) (266) (495) 59
Net cash flows provided by (used in) operating activities (I) 45 (267) 647
Cash flows from investment operations
Purchases of property and equipment and intangible assets (35) (33) (74)
Proceeds from sale of property and equipment and intangible assets 1 – 10
Proceeds from sale of investments and other financial assets, net (5) 3 10
Acquisition of subsidiaries (48) (70) (298)
Divestment of subsidiaries 1 – 1
Net cash flows provided by (used in) investment operations (II) (86) (100) (351)
Cash flows from financing operations
Capital Increase – – –
Dividends paid to parent company shareholders – – (107)
Dividends paid to minority shareholders of subsidiaries (14) (15) (26)
Cash received on new borrowings 13 734 744
Reimbursement of borrowings (59) (115) (108)
Net (purchases)/sales of treasury shares and equity warrants (249) 1 5
Cash received on hedging transactions – – –
Net cash flows provided by (used in) financing operations (III) (309) 605 508
Impact of exchange rate fluctuations (IV) 173 34 (94)
Net change in consolidated cash flows (I + II + III + IV) (177) 272 710
Cash and cash equivalents as of January 1, 1,580 867 867
Bank overdrafts as of January 1, (33) (30) (30)
Net cash and cash equivalents at beginning of period 1,547 837 837
Cash and cash equivalents at end of period 1,418 1,162 1,580
Bank overdrafts at end of period (48) (53) (33)
Net cash and cash equivalents at end of period 1,370 1,109 1,547
Net change in cash and cash equivalents (177) 272 710
(1) Breakdown of change in working capital requirements
Change in inventory and costs billable to clients (73) 31 29
Change in accounts receivable and other receivables (458) 729 160
Change in accounts payable, other creditors and provisions 265 (1,255) (130)
Variation in working capital requirements (266) (495) 59

Statement of changes in consolidated shareholders` equity

Number of outstanding shares (in millions of euros) Capital stock Additional paid-in capital Reserves and retained earnings Translation reserve Fair-value reserve Equity attributable to holders of the parent company Non-Controlling Interest (Minority interests) Total Equity

178,854,301 January 1, 2009 78 2,553 (105) (315) 109 2,320 30 2,350
Net income for the period 167 167 5 172
Other comprehensive income
Valuation of available-for-sale investments at fair value 4 4 4
Actuarial gains and losses on defined benefit plans (11) (11) (11)
Translation of foreign operations (14) (14) 2 (12)
Total other comprehensive income – – (11) (14) 4 (21) 2 (19)
Total comprehensive income for the period – – 156 (14) 4 146 7 153

Equity component of OCEANE 2014 49 49 49
Dividends (107) (107) (15) (122)
Share-based compensation 12 12 12
Additional interest on Oranes (3) (3) (3)
Effect of changes in scope of consolidation and of commitments to purchase minority interests – 3 3
72,910 Purchases/sales of treasury shares 1 1 1
178,927, 211 June 30, 2009 78 2,553 3 (329) 113 2,418 25 2,443

Number of outstanding shares (in millions of euros) Capital stock Additional paid-in capital Reserves and retained earnings Translation reserve Fair-value reserve Equity attributable to holders of the parent company Non-Controlling Interests (Minority interests) Total Equity

187,168,768 January 1, 2010 79 2,600 390 (377) 121 2,813 25 2,838
Net income 213 213 9 222
Other comprehensive income
Valuation of available-for-sale investments at fair value (1) (1) (1)
Actuarial gains and losses on defined benefit plans (17) (17) (17)
Translation of foreign operations 422 422 9 431
Total other comprehensive income – – (17) 422 (1) 404 9 413
Total comprehensive income for the period – – 196 422 (1) 617 18 635

Dividends paid (107) (107) (14) (121)
Share-based compensation 19 19 19
Additional interest on Oranes (3) (3) (3)
Effect of changes in scope of consolidation and of commitments to purchase minority interests – (8) (8)
(7,500,000) Cancellation of Publics Groupe SA shares (3) (215) (218) (218)
(807,764) Purchases/sales of treasury shares (31) (31) (31)
178,861,004 June 30, 2010 76 2,385 464 45 120 3,090 21 3,111

Earnings per share calculation details

Earnings per share and diluted earnings per share

(In millions of euro except for shares) June 30, 2010 June 30, 2009
Net income used for the calculation of earnings per share
Net income attributable to equity holders of the parent a 213 167
Impact of dilutive instruments:
– Savings in financial expenses related to the conversion of debt instruments, net of tax (1) 13 2
Net income attributable to equity holders of the parent – diluted b 226 169
Number of shares used for the calculation of earnings per share
Average number of shares composing the company`s share capital 195,469,852 196,020,983
Treasury shares to be deducted (average for the year) (11,231,966) (17,130,227)
Shares to be issued to redeem the Oranes 20,307,677 21,869,806
Average number of shares used for the calculation c 204,545,563 200,760,562
Impact of dilutive instruments: (2)
– Free shares and dilutive stock options 3,904,161 1,045,823
– Equity warrants (BSA) 172,692 –
– Shares resulting from the conversion of convertible bonds (1) 28,450,700 4,455,073
Number of shares – diluted d 237,073,116 206,261,458
(en euro)
Net earnings per share a/c 1.04 0.83

Net earnings per share – diluted b/d 0.95 0.82

(1)In 2010 and 2009, both Oceane 2018 and Oceane 2014 were taken into account
for the calculations (the Oceane 2014, issued in June 2009, was only included
for one month for the first semester 2009).

(2)Only stock-options and equity warrants with a dilutive effect (whose exercise
price is lower than the average share price for the period) are taken into
consideration.

Headline earnings per share and diluted earnings per share

(In millions of euro except for shares) June 30, 2010 June 30, 2009
Net income used for the calculation of headline earnings per share (1)
Net income attributable to equity holders of the parent 213 167
Items excluded:
– Amortization of intangibles arising on acquisition, net of tax 10 9
– Impairment, net of tax – 16
– Deferred tax asset linked to Oceane 2014 (2) – (11)
Headline income attributable to equity holders of the parent e 223 181
Impact of dilutive instruments:
– Savings in financial expenses related to the conversion of debt instruments, net of tax 13 2
Adjusted net income attributable to equity holders of the parent – diluted f 236 183

Number of shares used for the calculation of earnings per share
Average number of shares composing the company`s share capital 195,469,852 196,020,983
Treasury shares to be deducted (average for the year) (11,231,966) (17,130,227)
Shares to be issued to redeem the Oranes 20,307,677 21,869,806
Average number of shares used for the calculation c 204,545,563 200,760,562
Impact of dilutive instruments:
– Free shares and dilutive stock options 3,904,161 1,045,823
– Equity warrants (BSA) 172,692 –
– Shares resulting from the conversion of convertible bonds 28,450,700 4,455,073
Number of shares – diluted d 237,073,116 206,261,458
(in euro)
Headline earnings per share (1) e/c 1.09 0.90
Headline earnings per share – diluted (1) f/d 1.00 0.89

(1)Earnings per share before Amortization of intangibles from acquisitions,
impairment and deferred tax assets linked to equity component of Oceane 2014.

(2)Effect of deferred tax asset recognized against deferred tax liabilities
linked to equity component of Oceane 2014 recorded as equity.

PUBLICIS GROUPE CONTACTS
Peggy Nahmany, Corporate Communication: + 33 (0)1 44 43 72 83
peggy.nahmany@publicisgroupe.com
or
Martine Hue, Investor Relations: + 33 (0)1 44 43 65 00
martine.hue@publicisgroupe.com

Copyright Business Wire 2010

Filed Under: International News Tagged With: , , , , , , , , , , , , , , , , , , ,

Takkt AG: TAKKT Group returns to growth

July 30, 2010 By Leave a Comment

Takkt AG / TAKKT Group returns to growth processed and transmitted by Hugin AS. The
issuer is solely responsible for the content of this announcement.

Turnover and profit rise in both Europe and North America

Stuttgart, Germany, 29 July 2010. The economic upswing in the first half of 2010 had a
positive effect on business developments at TAKKT Group. TAKKT’s business revived
considerably in the second quarter, compensating for the negative growth rates recorded
in the first months of 2010 and enabling the Group to post an organic increase in
turnover for the first half-year. Operational profitability improved significantly
compared to the previous year’s period. As forecasted at the beginning of the year,
TAKKT Group has returned to growth. In the light of the positive business climate, the
organic growth target for the company’s annual turnover has been raised to around three
percent.

Significant events in the first half of 2010

* Organic increase in turnover of 0.9 percent in the first half-year and 6.6 percent in
Q2
* EBITDA margin climbs to 13.9 (11.0) percent
* Earnings per share up 46 percent
* TAKKT awarded first place in the Investor Relations Awards organised by the business
magazine Capital

In the first six months of 2010, TAKKT Group benefited from the economic upturn in all
its key sales regions. Consolidated turnover increased by 5.2 percent to EUR 376.8
(previous year’s period: 358.3) million. Adjusted for currency effects and Central
Products LLC (Central), acquired in April 2009, this corresponds to organic growth of
0.9 percent in turnover. While an organic decrease in turnover of minus 4.1 percent was
recorded in Q1, organic turnover growth of 6.6 percent was posted in the second quarter.
“The growth dynamic remained intact in the first six months of the current financial
year. In March 2010, we predicted that the company would return to growth in Q2 – this
has proved us right”, said CEO Dr Felix A. Zimmermann.

As expected, the gross profit margin increased slightly in the first half to 42.8 (42.3)
percent. Excluding the Central acquisition, the increase was 0.8 percentage points.
TAKKT Group is continuing to benefit from the improved procurement conditions agreed
during the crisis.

Operational profitability showed a considerable year-on-year improvement in the first
half of 2010 due to a turnover-related increase in infrastructure utilisation, higher
advertising efficiency and the FOCUS measures implemented in the previous year. EBITDA
(earnings before interest, tax, depreciation and amortisation) rose by 32.2 percent to
EUR 52.2 (39.5) million in the first six months of the year. This corresponds to an
increase in the EBITDA margin to 13.9 (11.0) percent.

As usual, cash flow developed strongly during the reporting period, increasing by 24.3
percent to EUR 36.8 (29.6) million. The cash flow margin was 9.8 (8.3) percent.

Upturn at TAKKT EUROPE
The new Group structure introduced on 01 January 2010 (last year’s figures have been
adjusted to improve comparability) enabled the growth rate of the TAKKT EUROPE division
to catch up with the TAKKT AMERICA division growth rate. Although its customers
initially remained reluctant to buy, the first six months of the year were marked by a
gradual, continuous recovery at TAKKT EUROPE. In total, the division generated turnover
of EUR 222.4 (218.8) million – an increase of 1.6 percent year-on-year. With this, TAKKT
EUROPE generated 59.0 (61.0) percent of consolidated turnover. Adjusted for the various
currency effects, the growth was equivalent to 0.1 percent in the first half and 7.7
percent in Q2.

The Office Equipment Group (OEG) – comprising the Topdeq companies – was unable to keep
up with the high single-digit growth rate posted by the Business Equipment Group (BEG),
which consists of the former KAISER + KRAFT EUROPA companies. Even after adjusting for
the US activities closed at the end of 2009, turnover dropped by a double-digit
percentage at the OEG and remained disappointing. In the light of this, the Group is
currently working on strategically repositioning the Topdeq companies.

TAKKT EUROPE generated EBITDA of EUR 41.9 (31.1) million in the first half of the year.
This took the EBITDA margin from 14.2 percent in H1 2009 to 18.8 percent.

The Group continues to drive the division’s expansion in the current financial year.
KAISER + KRAFT began operations in Russia in January. Following a successful launch in
Germany, the new online brand Certeo has now also been rolled out on the Austrian
market. The gaerner Group, which specialises in plant and office equipment, commenced
sales activities in Italy in May 2010.

All companies will expand their range of private label articles due to positive
experience throughout the Group. The BEG has been offering high-quality transport
equipment at fair prices under the name of Quipo since March. In addition to this,
Topdeq has been marketing its own range of high-end office furniture since January,
branded as siqnatop.

In April 2010, TAKKT acquired minority interests in the Dutch company Vink Lisse B.V.
and the Belgian subsidiary KAISER + KRAFT N.V. for a purchase price of approximately EUR
11 million.

TAKKT AMERICA posts solid growth
Turnover at the TAKKT AMERICA division came in at USD 204.4 (185.8) million in the
reporting period. This corresponds to a year-on-year increase of 10.0 percent. Adjusted
for the Central acquisition, the division’s turnover still grew by 3.4 percent based on
US dollar figures in the first half, with growth of 5.5 percent recorded in the second
quarter. Translated into the reporting currency Euro, turnover increased by 10.7 percent
to EUR 154.5 (139.6) million during the first six months. TAKKT AMERICA therefore
contributed 41.0 (39.0) percent to consolidated turnover.

The division still benefits from the broad diversification of its client base and
product portfolio. As expected, the companies within the Office Equipment Group (OEG)
experienced a slight year-on-year decline in turnover as they tend to be late-cycle
businesses. Thanks to high growth rates in the second quarter, the Plant Equipment Group
(PEG) posted a single-digit increase in turnover overall. With high single-digit rates
of organic growth, the Specialties Group (SPG) recorded the strongest gain. Including
Central, growth here even ran well into double figures.

In the period under review, TAKKT AMERICA generated EBITDA of EUR 14.1 (12.1) million.
This corresponds to an EBITDA margin of 9.1 (8.7) percent. Adjusted for Central, the
EBITDA margin was 8.9 (8.4) percent.

Following the successful launch of Hubert in Germany and France, the brand will be
rolled out into the Swiss market in autumn 2010. The PEG has also been active on the
North American market with the online-only brand Industrialsupplies.com since June.
Furthermore all three groups of the TAKKT AMERICA division are intensifying their
private label engagement.

Business climate gives grounds for more optimistic forecast
For the remainder of 2010, TAKKT expects the economic recovery in Europe and North
America to continue, though with slightly diminished dynamic. “We should be able to
exceed the upper limit of organic growth of two percent targeted at the beginning of the
year. We currently expect to see growth of around three percent. If we achieve this
turnover goal, the EBITDA margin for the whole Group should come close to the lower end
of the long-term target corridor of twelve to 15 percent”, said Dr Florian Funck, CFO.

Conference call
We invite you to directly address the Management Board with your questions. We will be
hosting a conference call for this purpose at 15:00 (CEST) on 29 July 2010, during which
we will be open to questions. To take part, please dial the following number: +49 69
201744-295 (access code: 779134#).

Short profile of TAKKT AG
TAKKT is the leading B2B direct marketing specialist for business equipment in Europe
and North America. The Group is represented with its brands in more than 25 countries.
The product range of the TAKKT subsidiaries comprises over 160,000 items for the areas
of business and warehouse equipment, classic and design-oriented office furniture and
accessories, and supplies for retailers, the food service industry and the hotel market.

TAKKT Group employs some 1,800 staff, has around three million customers worldwide and
distributes more than 55 million catalogues and mailings per year.

TAKKT AG is listed on the SDAX and was admitted to Deutsche Boerse’s Prime Standard on
01 January 2003.

IFRS figures for TAKKT Group to the end of Q2 2010

in EUR million

Q2 2010 Q2 2009* Change in % HY 1 2010 HY 1 2009* Change in %
Turnover TAKKT Group 191.0 171.9 11.1 376.8 358.3 5.2
Organic growth 6.6 0.9
TAKKT EUROPE 108.4 98.6 9.9 222.4 218.8 1.6
TAKKT AMERICA (€) 82.6 73.3 12.7 154.5 139.6 10.7
TAKKT AMERICA ($) 105.0 99.5 5.5 204.4 185.8 10.0
EBITDA 23.5 12.6 86.5 52.2 39.5 32.2
EBITDA margin 12.3 7.3 13.9 11.0
EBIT 18.4 7.7 139.0 42.3 30.5 38.7
EBIT margin 9.6 4.5 11.2 8.5
Profit before tax 15.9 6.1 160.7 37.6 27.5 36.7
Pbt margin 8.3 3.5 10.0 7.7
Cash flow 16.3 9.9 64.6 36.8 29.6 24.3
Cash flow margin 8.5 5.8 9.8 8.3

* The 2009 figures have been adjusted to the new segment structure for the sake of
comparability.

Contacts:
Dr Felix A. Zimmermann, CEO Tel. +49 711 3465-8201
Dr Florian Funck, CFO Tel. +49 711 3465-8207

Email: investor@takkt.de

HUG#1434502

Press Release as PDF http://hugin.info/131631/R/1434502/380103.pdf

— End of Message —

Takkt AG
Neckartaltstr. 155 Stuttgart null

Listed: Regulierter Markt in Frankfurter Wertpapierbörse;

Filed Under: International News Tagged With: , , , , , , , , , , , , , , , , , , ,

UPDATE 1-African Barrick cuts FY production guidance

July 28, 2010 By Leave a Comment

LONDON, July 27 (Reuters) – African Barrick Gold (ABG) (ABGL.L), which floated in London this year, has cut its full-year production guidance due to delays in accessing higher grade from its new Buzwagi mine in Tanzania.

It expects to produce 750,000-800,000 ounces of gold for the year, at a cash cost of $500-550 an ounce, down from its 800,000 to 850,000 ounce target.

ABG’s chief executive told Reuters in June that production this year would likely end up at the low end of its 800,000 to 850,000 ounce target after a slow ramp up at its new Buzwagi open pit mine. [ID:nLDE65L22D]

On Tuesday, the FTSE 100 miner said first-half attributable production was 356,208 ounces, up 23 percent year-on-year, at cash costs of $529 per ounce.

The miner reiterated that it expects higher grade primary sulphide ore to be increasingly mined in the second half and for production to rise at Buzwagi.

First-half net income jumped 217 percent from the year-earlier period to $99 million and the company said it plans to pay an interim dividend of 1.6 cents per share.

Shares in the FTSE 100 group closed on Monday at 550 pence, just below the IPO price. Gold prices XAU= rose 13 percent in the first half of 2010 to touch a record $1,264.90 an ounce in June on concern over euro zone sovereign debt levels. [GOL/]

The market has viewed the company, which has four producing gold mines in Tanzania, with some caution compared to its rivals and is looking for African Barrick to establish a track record of organic growth or make an acquisition elsewhere in Africa.

ABG, spun off on March 19 from its Canadian parent Barrick Gold Corp (ABX.TO), the world’s largest gold miner, after raising 581 million pounds via an initial public offering at 575 pence a share.

Barrick Gold will announce its second-quarter results on Thursday. [ID:nN22125838]

(Reporting by Julie Crust; editing by Rhys Jones)

Filed Under: International News Tagged With: , , , , , , , , , , , , , , , , , , ,

Teva Reports Strong Second Quarter 2010 Results Driven by Growth in All Businesses

July 28, 2010 By Leave a Comment

European Sales Grew 10% in Local Currencies –
JERUSALEM–(Business Wire)–
Teva Pharmaceutical Industries Ltd. (NASDAQ: TEVA) today reported results for
the quarter ended June 30, 2010.

Second Quarter Highlights:

* Quarterly net sales of $3.8 billion, reflecting organic growth of 12%,
compared to the comparable period in 2009.
* Quarterly non-GAAP net income and non-GAAP EPS of $981 million and $1.08, up
32% and 30%, respectively, compared with the second quarter of 2009. Quarterly
GAAP net income and EPS totaled $797 million and $0.88, up 53% and 52%,
respectively, compared with the second quarter of 2009.
* Quarterly non-GAAP operating income of $1.2 billion, up 22% compared with the
second quarter of 2009. Quarterly GAAP operating income totaled $1.1 billion, up
53% compared with the second quarter of 2009.
* Quarterly global in-market sales of Copaxone® of $773 million, up 13% over the
second quarter of 2009. Copaxone® continues to be the leading MS therapy in the
U.S. and globally.
* Quarterly cash flow from operations of $954 million, up 45% compared with the
second quarter of 2009. Free cash flow of $700 million, up 86% compared with the
second quarter of 2009.
* Financing of ratiopharm acquisition secured with debt offering of $2.5 billion
and committed bank loans of $1.5 billion.
* For the first six months of 2010, sales increased by 14%, non-GAAP EPS
increased by 29% and GAAP EPS increased by 52%, compared to the first six months
of 2009.

“This was truly a superb quarter, in which Teva achieved record-breaking
results, including outstanding organic growth,” commented Shlomo Yanai, Teva`s
President and Chief Executive Officer. “It was an especially strong quarter in
North America, where we had nine new product launches, and in Europe, where we
experienced solid growth despite the challenging market environment.”

Mr. Yanai continued, “2010 is well on track to becoming another year of
profitable growth and major achievements for Teva, a year in which we will make
significant progress towards achieving our long-term strategic objectives.”

Net sales for the second quarter increased 12% to $3,800 million, compared to
$3,400 million in the second quarter of 2009.

Exchange rate differences negatively impacted sales in the second quarter of
2010 by approximately $52 million compared to the second quarter of 2009, while
having a negligible positive impact on operating income. The impact on sales
resulted from the decline in the value of certain currencies relative to the
U.S. dollar (primarily the Euro, the British pound and the Hungarian forint),
partially offset by the strengthening of the value of other currencies relative
to the U.S. dollar (primarily the Canadian dollar, the Israeli shekel and the
Russian ruble) in the second quarter of 2010 compared with the second quarter in
2009.

Non-GAAP net income for the second quarter of 2010 totaled $981 million, an
increase of 32% compared to the second quarter of 2009, while non-GAAP diluted
earnings per share were $1.08, an increase of 30% compared to the second quarter
of 2009. On a U.S. GAAP basis, net income for the second quarter totaled $797
million, up 53% compared to the second quarter of 2009, while diluted earnings
per share were $0.88, up 52% compared to the second quarter of 2009.

Non-GAAP net income and non-GAAP EPS for the second quarter of 2010 are adjusted
to exclude the following items:

* Amortization of purchased intangible assets of $130 million;
* Financial expenses of $123 million related to hedging activity in connection
with the acquisition of ratiopharm, net of gains from the sale of marketable
securities;
* Income of $23 million in connection with legal settlements;
* Other adjustments totaling $19 million; and
* Related tax benefits of $65 million.

Teva believes that excluding these items facilitates investors’ understanding of
the trends in the Company’s underlying business. In the second quarter of 2009,
non-GAAP net income and non-GAAP EPS excluded amortization of purchased
intangible assets, inventory step-up, legal settlements, restructuring expenses
and related tax effects. See the attached tables for a reconciliation of U.S.
GAAP reported results to the adjusted non-GAAP figures.

Quarterly non-GAAP operating income (which excludes amortization of purchased
intangible assets, restructuring expenses, purchase of R&D in-process and
impairment of assets, offset by income in connection with legal settlements, as
detailed above) reached $1,201 million, an increase of 22% compared with the
second quarter of 2009. On a U.S. GAAP basis, operating income for the second
quarter of 2010 totaled $1,075 million, up 53% compared to the second quarter of
2009.

Sales in North America in the second quarter reached $2,467 million, accounting
for 65% of total sales and representing an increase of 17% compared with the
second quarter of 2009. The increase in quarterly sales resulted from the launch
of generic versions of Hyzaar® (losartan potassium – hydrochlorothiazide),
Cozaar® (losartan potassium) and Yaz® (drospirenone and ethinyl estradiol), as
well as continued strong sales of generic versions of Pulmicort Respules®
(budesonide), Mirapex® (pramipexole) and Eloxatin® (oxaliplatin) launched in
previous quarters. The quarter’s sales also reflected continued strong sales of
Copaxone®. Generic and other product sales in the U.S. were $1,502 million in
the quarter, up 14% compared to the comparable quarter in 2009.

As of July 16, 2010, Teva had 206 product applications awaiting final FDA
approval, including 44 tentative approvals. Collectively, the brand products
covered by these applications had annual U.S. sales of over $107 billion. Of
these applications, 134 were “Paragraph IV” applications challenging patents of
branded products. Teva believes it is the first to file on 82 of the
applications, relating to products with annual U.S. branded sales exceeding $48
billion.

Sales in Europe in the second quarter of 2010 totaled $811 million, accounting
for 21% of total sales and representing an increase of 4% compared with the
second quarter of last year. In local currency terms, sales in Europe grew 10%
compared with the second quarter of 2009. The increase in sales was mostly
attributable to strong generic sales in Italy, Spain and France, as well as
increased sales of Copaxone® and Azilect®.

Since the beginning of 2010, Teva received 594 generic approvals in Europe
relating to 111 compounds in 209 formulations, including four European
Commission approvals valid in all EU member states. In addition, as of June 30,
2010, Teva had approximately 2,574 marketing authorization applications pending
approval in 30 European countries, relating to 241 compounds in 470
formulations, including seven applications pending with the EMA.

International sales in the second quarter of 2010 totaled $522 million,
accounting for 14% of total sales and representing an increase of 1% compared to
the second quarter of 2009. In local currency terms, international sales grew 6%
compared with the second quarter of 2009. The increase in sales was driven
primarily by increased sales in Latin America and Israel. Sales in the quarter
were adversely affected from the timing of Copaxone® sales in government
tenders.

Copaxone® remains the number one MS therapy in the U.S. and globally. Global
in-market sales reached $773 million in the second quarter of 2010, an increase
of 13% over the second quarter of 2009. In the U.S., quarterly in-market sales
increased 21% to $531 million compared to the second quarter of 2009. In-market
sales outside the U.S. totaled $243 million, flat compared to the second quarter
of 2009, with growth in sales recorded in Europe and Latin America offset by
weaker sales in certain international markets due to timing of tenders. In local
currency terms, in-market sales of Copaxone® outside the U.S. grew 2% in the
second quarter of 2010.

Global in-market sales of Azilect® reached $70 million in the quarter, a 29%
increase over the comparable period in 2009, benefiting primarily from an
increase in sales in Europe (mostly in France Spain, Italy and Germany). In
local currency terms, global in-market sales of Azilect® grew 33% in the second
quarter of 2010.

Teva’s global respiratory product sales totaled $221 million in the quarter, up
17% compared to $189 million in the second quarter of 2009. The increase is
attributable to continued growth in Qvar® and ProAir™ sales in the U.S. Teva’s
respiratory product sales in the U.S. totaled $143 million in the second
quarter. As of June 30, 2010, Teva maintained its leadership position with a 50%
market share in the SABA (short acting beta agonist) market in the U.S., while
Qvar® continued to solidify its number two position in the inhaled
corticosteroid category (ICS) market with a 19% market share.

Teva’s women’s health business sales reached $82 million in the quarter, up 3%
compared to $80 million in the comparable quarter in 2009, benefiting from
strong sales of Seasonique® and ParaGard® in the second quarter.

API sales to third parties totaled $163 million in the second quarter, up 21%
compared to $135 million in the comparable quarter in 2009.

Non-GAAP gross profitmargin reached 59.0% in the second quarter of 2010,
compared to the 58.5% non-GAAP gross profit margin recorded in the comparable
quarter of 2009. Non-GAAP gross profit margins continued to benefit from the
contribution to sales of new and recently launched generic products in the U.S.,
improved gross margins of the U.S. generics base business as well as the
contribution to sales of innovative and branded products (including Copaxone®,
ProAir™, Azilect®, Qvar® and women’s health products). GAAP gross profit margin
reached 55.8% in the second quarter of 2010, compared to GAAP gross profit of
52.0% in the comparable quarter of 2009. The improvement was due to the
inventory step up expenses recorded in connection with the acquisition of Barr
Pharmaceuticals and higher amortization of purchased intangible assets recorded
in the second quarter of 2009, in addition to the above factors.

Net Research & Development (R&D) expenditures in the second quarter totaled $217
million, or 5.7% of sales, compared to $169 million recorded in the second
quarter of 2009, or 5.0% of sales. Gross R&D in the second quarter of 2010,
before reimbursement from third parties for certain R&D expenses, totaled $227
million, or 6.0% of sales, an increase of 8% compared to the comparable quarter
in 2009. For the full year, Teva continues to expect net R&D expenses to be
between 6% and 6.5% of net sales.

Selling and Marketing (S&M) expenditures (excluding amortization of purchased
intangible assets) totaled $636 million, or 16.7% of sales, for the second
quarter, compared to $641 million, or 18.9% of sales, in the comparable quarter
of 2009. The decrease in S&M expenses is attributable primarily to the
termination, as of the beginning of the quarter, of payments to sanofi-aventis
in connection with Copaxone®’s North American sales, offset by higher royalty
payments in connection with new and recently launched generic products sold in
the U.S.

General and Administrative (G&A) expenditures totaled $189 million, or 5.0% of
sales, for the second quarter, compared with $197 million, or 5.8% of sales, in
the comparable quarter of 2009.

The tax expense provided for the second quarter was $183 million of pre-tax
non-GAAP income of $1,176 million. Teva’s current estimate of the annual tax
rate of non-GAAP income for 2010 is 15%, compared to a rate of 16% of pre-tax
non-GAAP income for all of 2009. On a GAAP basis, the annual tax rate for 2010
is estimated to be approximately 12%.

Cash flow generated from operating activities during the second quarter of 2010
was $954 million, compared to $658 million in the comparable quarter in 2009.
Free cash flow – excluding gross capital expenditures (of $136 million) and
dividends (of $164 million), partially offset by sales of assets ($46 million) -
reached $700 million.

Cash and marketable securities as of June 30, 2010 were $5.2 billion, up
approximately $2.2 billion from March 31, 2010, due to the sale of $2.5 billion
principal amount of senior notes and strong cash generation in the second
quarter, net of approximately $903 million of debt repayment, primarily bank
debt incurred in connection with the Barr acquisition.

Total equity as of June 30, 2010 amounted to $19.4 billion, an increase of $104
million compared to $19.3 billion as of December 31, 2009. The increase in total
equity is attributable primarily to GAAP net income, offset by the negative
impact of currency translation resulting from the weakening of major non-U.S.
currencies compared to the U.S. dollar (mainly the Euro, the Hungarian forint,
the Polish zloty and the Czech koruna) as well as dividends paid to
shareholders.

For the second quarter of 2010, the weightedaverage share count for the fully
diluted earnings per share calculation was 921 million shares on both a GAAP and
non-GAAP basis. As of June 30, 2010, Teva’s share count going forward for the
fully diluted share calculation is estimated at 922 million shares, while the
share count for calculating Teva’s market capitalization is approximately 898
million shares.

Dividend

The Board of Directors, at its meeting on July 26, 2010, declared a cash
dividend for the second quarter of 2010 of NIS 0.70 (approximately 18.1 cents
according to the rate of exchange on July 26, 2010) per share.

The record date will be August 4, 2010, and the payment date will be August 19,
2010. Tax will be withheld at a rate of 9%.

Conference Call

Teva will host a conference call to discuss the Company’s second quarter 2010
results, on Tuesday, July 27, 2010 at 8:30 a.m. ET. The call will be webcast and
can be accessed through the Company’s website at www.tevapharm.com. Following
the conclusion of the call, a replay of the webcast will be available within 24
hours at the Company’s website. A replay of the call will also be available
until August 3, 2010, at 11:59 p.m. ET, by calling 858-384-5517 or 877-870-5176.
The Conference ID# is 353522.

About Teva

Teva Pharmaceutical Industries Ltd. (NASDAQ:TEVA) is a leading global
pharmaceutical company, committed to increasing access to high-quality
healthcare by developing, producing and marketing affordable generic drugs as
well as innovative and specialty pharmaceuticals and active pharmaceutical
ingredients. Headquartered in Israel, Teva is the world’s largest generic drug
maker, with a global product portfolio of more than 1,250 molecules and a direct
presence in over 60 countries. Teva’s branded businesses focus on neurological,
respiratory and women’s health therapeutic areas as well as biologics. Teva’s
leading innovative product, Copaxone®, is the number one prescribed treatment
for multiple sclerosis. Teva employs more than 35,000 people around the world
and reached $13.9 billion in net sales in 2009.

Teva’s Safe Harbor Statement under the U. S. Private Securities Litigation
Reform Act of 1995:

This release contains forward-looking statements, which express the current
beliefs and expectations of management. Such statements involve a number of
known and unknown risks and uncertainties that could cause our future results,
performance or achievements to differ significantly from the results,
performance or achievements expressed or implied by such forward-looking
statements. Important factors that could cause or contribute to such differences
include risks relating to: our ability to successfully develop and commercialize
additional pharmaceutical products, the introduction of competing generic
equivalents, the extent to which we may obtain U.S. market exclusivity for
certain of our new generic products and regulatory changes that may prevent us
from utilizing exclusivity periods, potential liability for sales of generic
products prior to a final resolution of outstanding patent litigation, including
that relating to the generic versions of Neurontin®, Lotrel®, Protonix®, and
Yaz® current economic conditions, the extent to which any manufacturing or
quality control problems damage our reputation for high quality production, the
effects of competition on our innovative products, especially Copaxone® sales,
dependence on the effectiveness of our patents and other protections for
innovative products, especially Copaxone®, the impact of consolidation of our
distributors and customers, the impact of pharmaceutical industry regulation and
pending legislation that could affect the pharmaceutical industry, our ability
to achieve expected results though our innovative R&D efforts, the difficulty of
predicting U.S. Food and Drug Administration, European Medicines Agency and
other regulatory authority approvals, the uncertainty surrounding the
legislative and regulatory pathway for the registration and approval of
biotechnology-based products, the regulatory environment and changes in the
health policies and structures of various countries, any failures to comply with
the complex Medicare and Medicaid reporting and payment obligations, the effects
of reforms in healthcare regulation, supply interruptions or delays that could
result from the complex manufacturing of our products and our global supply
chain, interruptions in our supply chain or problems with our information
technology systems that adversely affect our complex manufacturing processes,
potential tax liabilities that may arise should our agreements (including
intercompany arrangements), be challenged successfully by tax authorities, our
ability to successfully identify, consummate and integrate acquisitions and
other business combinations (including our pending acquisition of ratiopharm),
the potential exposure to product liability claims to the extent not covered by
insurance, our exposure to fluctuations in currency, exchange and interest
rates, as well as to credit risk, significant operations worldwide that may be
adversely affected by terrorism, political or economical instability or major
hostilities, our ability to enter into patent litigation settlements and the
increased government scrutiny of our agreements with brand companies in both the
U.S. and Europe, the termination or expiration of governmental programs and tax
benefits, impairment of intangible assets and goodwill, any failure to retain
key personnel or to attract additional executive and managerial talent,
environmental risks, and other factors that are discussed in our Annual Report
on Form 20-F for the year ended December 31, 2009, in this report and in our
other filings with the U.S. Securities and Exchange Commission (“SEC”).

Teva Pharmaceutical Industries Limited

Consolidated Statements of Income
(Unaudited, U.S. Dollars in millions, except share and per share data)

Three Months Ended Six Months Ended
June 30, June 30,
2010 2009 2010 2009
Net sales 3,800 3,400 7,453 6,547
Cost of sales (a) 1,679 1,631 3,319 3,207
Gross profit 2,121 1,769 4,134 3,340
Research and development expenses 217 169 424 388
Selling and marketing expenses (b) 644 649 1,396 1,253
General and administrative expenses 189 197 371 393
Legal settlements, acquisition and restructuring expenses and impairment (9) 52 25 66
Purchase of research and development in process 5 – 9 –
Operating income 1,075 702 1,909 1,240
Financial expenses- net (c) 148 61 175 124
Income before income taxes 927 641 1,734 1,116
Provision for income taxes (d) 118 98 203 123
809 543 1,531 993
Share in losses of associated companies – net 9 20 17 19
Net income 800 523 1,514 974
Net income attributable to non-controlling interests 3 2 4 2
Net income attributable to Teva 797 521 1,510 972

Earnings per share attributable to Teva: Basic ($) 0.89 0.61 1.69 1.13
Diluted ($) 0.88 0.58 1.66 1.09
Weighted average number of shares (in millions): Basic 895 860 894 858
Diluted 921 895 921 895

Non-GAAP net income attributable to Teva:*** 981 742 1,811 1,376

Non-GAAP earnings per share attributable to Teva: Basic ($) 1.10 0.86 2.03 1.60
Diluted ($) 1.08 0.83 1.99 1.54

Weighted average number of shares (in millions): Basic 895 860 894 858
Diluted 921 911 921 911

*** See reconciliation attached.

(a) Cost of sales includes $122 million and $143 million of amortization of purchased intangible assets in the three months ended June 30, 2010 and 2009, respectively, and $76 million of inventory step-up in the three months ended June 30, 2009.
(b) Selling and marketing expenses includes $8 million of amortization of purchased intangible assets in the three months ended June 30, 2010 and 2009.
(c) Financial expenses includes $147 million resulting from hedging of the ratiopharm acquisition offset by $24 million gain from sale of securities in the three months ended June 30, 2010.
(d) Provision for income taxes includes $(65) million and $(58) million of related tax effect of non-GAAP charges in the three months ended June 30, 2010 and 2009, respectively.

Teva Pharmaceutical Industries Limited

Condensed Balance Sheets
(U.S. Dollars in millions)

June 30, December 31,
2010 2009
ASSETS unaudited audited
Current assets:
Cash and cash equivalents 4,854 1,995
Short-term investments 24 253
Accounts receivable 4,985 5,019
Inventories 3,078 3,332
Deferred taxes and other current assets 1,502 1,542
Total current assets 14,443 12,141
Long-term investments and receivables 628 534
Deferred taxes, deferred charges and other assets 630 642
Property, plant and equipment, net 3,622 3,766
Identifiable intangible assets, net 3,639 4,053
Goodwill 12,223 12,674
Total assets 35,185 33,810

LIABILITIES AND EQUITY
Current liabilities:
Short-term debt and current maturities of long term liabilities 1,946 1,301
Sales reserves and allowances 2,978 2,942
Accounts payable and accruals 2,647 2,680
Other current liabilities 611 679
Total current liabilities 8,182 7,602
Long-term liabilities:
Deferred income taxes 1,686 1,741
Other taxes and long term payables 712 727
Employee related obligations 171 170
Senior notes and loans 5,050 3,494
Convertible senior debentures 21 817
Total long-term liabilities 7,640 6,949
Equity:
Teva shareholders’ equity 19,328 19,222
Non-controlling interests 35 37
Total equity 19,363 19,259
Total liabilities and equity 35,185 33,810

Teva Pharmaceutical Industries Limited

Reconciliation between Reported and Non-GAAP Net Income
(Unaudited, U.S. Dollars in millions, except share and per share data)

Three Months Ended Six Months Ended
June 30, June 30,
2010 2009 2010 2009
Reported net income attributable to Teva 797 521 1,510 972
Inventory step-up – 76 – 296
Purchase of research and development in process 5 – 9 –
Amortization of purchased intangible assets – under cost of sales 122 143 244 189
Amortization of purchased intangible assets – under selling and marketing 8 8 16 16
Legal settlements (23) 42 (6) 42
Impairment of assets 3 – 3 2
Acquisition and restructuring expenses 11 10 28 22
Financial expenses related to hedging activity of the ratiopharm acquisition 147 – 147 –
Gain from sale of marketable securities (24) – (24) –
Related tax effect (65) (58) (116) (163)
Non-GAAP net income attributable to Teva 981 742 1,811 1,376

Diluted earnings per share attributable to Teva: Reported ($) 0.88 0.58 1.66 1.09
Non-GAAP ($) 1.08 0.83 1.99 1.54

Add back for diluted earnings per share calculation:
Interest expense on convertible senior debentures, and issuance costs, net of tax benefits Reported ($) 11 1 22 2
Non-GAAP ($) 11 12 22 23

Diluted weighted average number of shares (in millions): Reported 921 895 921 895
Non-GAAP 921 911 921 911

Teva Pharmaceutical Industries Limited

Reconciliation between Reported and Non-GAAP Operating Income
(Unaudited, U.S. Dollars in millions)

Three Months Ended Six Months Ended
June 30, June 30,
2010 2009 2010 2009
Reported operating income 1,075 702 1,909 1,240
Inventory step-up – 76 – 296
Purchase of research and development in process 5 – 9 –
Amortization of purchased intangible assets – under cost of sales 122 143 244 189
Amortization of purchased intangible assets – under selling and marketing 8 8 16 16
Legal settlements (23) 42 (6) 42
Impairment of assets 3 – 3 2
Acquisition and restructuring expenses 11 10 28 22
Non-GAAP operating income 1,201 981 2,203 1,807

Teva Pharmaceutical Industries Limited

Condensed Cash Flow
(Unaudited, U.S. Dollars in millions)

Three Months Ended Six Months Ended
June 30, June 30,
2010 2009 2010 2009
Operating activities:
Net income 800 523 1,514 974
Purchase of research and development in process 5 – 9 –
Other adjustments to reconcile net income to net cash provided from operations 149 135 317 417

Net cash provided by operating activities 954 658 1,840 1,391

Net cash provided by (used in) investing activities 189 (175) (139) (317)

Net cash provided by (used in) financing activities 1,525 (1,131) 1,350 (1,155)

Translation adjustment on cash and cash equivalents (170) 59 (192) (12)

Net increase (decrease) in cash and cash equivalents 2,498 (589) 2,859 (93)

Balance of cash and cash equivalents at beginning of period 2,356 2,350 1,995 1,854

Balance of cash and cash equivalents at end of period 4,854 1,761 4,854 1,761

Teva Pharmaceutical Industries Limited

Three Months Ended
June 30, % of Total % of Total
2010 2009 2010 2009 % Change
(Unaudited, U.S Dollars in millions)

Sales by Geographic Area
North America 2,467 2,108 65% 62% 17%
Europe* 811 777 21% 23% 4%
International 522 515 14% 15% 1%
Total 3,800 3,400 100% 100% 12%

* Includes EU member states, Switzerland & Norway.

Teva Pharmaceutical Industries Limited

Six Months Ended
June 30, % of Total % of Total
2010 2009 2010 2009 % Change
(Unaudited, U.S Dollars in millions)

Sales by Geographic Area
North America 4,776 4,033 64% 62% 18%
Europe* 1,623 1,516 22% 23% 7%
International 1,054 998 14% 15% 6%
Total 7,453 6,547 100% 100% 14%

* Includes EU member states, Switzerland & Norway.

Investor Relations:
Teva Pharmaceutical Industries Ltd.
Elana Holzman, 972 (3) 926-7554
or
Teva North America
Kevin Mannix, 215-591-8912
or
Media:
Teva Pharmaceutical Industries Ltd.
Yossi Koren, 972 (3) 926-7590
or
Teva North America
Denise Bradley, 215-591-8974

Copyright Business Wire 2010

Filed Under: International News Tagged With: , , , , , , , , , , , , , , , , , , ,

Cision: Interim Report January-June 2010

July 23, 2010 By Leave a Comment

Continued improvement in profitability
STOCKHOLM–(Business Wire)–
April-June

* The Group`s operating revenue amounted to SEK 285 million (377). Organic
growth was negative at 5 percent, compared with negative 8 percent for
January-March 2010 and negative 12 percent for April-June 2009. Exchange rate
effects decreased revenue by SEK 11 million compared with the same period last
year.
* Operating profit excluding restructuring costs amounted to SEK 35 million
(30). Exchange rate effects had a negative impact on operating profit of SEK 1
million compared with the same period last year.
* Following mainly the successful divestment of loss-making businesses in
Europe, Cision`s operating margin excluding restructuring costs continued to
strengthen in the second quarter, reaching 12.2 percent compared with 10.4
percent in the first quarter of 2010 and 7.9 percent in the second quarter last
year.
* Cision US returned to organic growth of 3% in the second quarter, following
negative organic growth of 4% in the first quarter of 2010 and negative 10% for
2009.

January-June

* The Group`s operating revenue amounted to SEK 599 million (837). Organic
growth was negative at 7 percent (-10). Exchange rate effects decreased revenue
by SEK 45 million.
* Operating profit excluding restructuring costs amounted to SEK 68 million (48)
and the operating margin excluding restructuring costs was 11.3 percent (5.7).
Exchange rate effects had a negative impact on operating profit of SEK 6 million
compared with the same period last year.
* Operating profit including restructuring costs amounted to SEK 62 million (33)
and profit before tax was SEK 39 million (-14). Earnings per share were SEK 0.20
(-0.28).
* For the period January-June, operating cash flow amounted to SEK -3 million
(19) and free cash flow amounted to SEK -71 million (-56).

Comment by Cision CEO Hans Gieskes: “In the second quarter of 2010, we were
pleased to see continued improvement in profitability. Our EBITDA margin
exceeded 17 percent, up from 15 percent in the first quarter of 2010, indicating
that we are on track toward achieving our financial target of an EBITDA margin
exceeding 20 percent by 2012 at the latest. The improvement in profitability was
mainly driven by stronger performance in Cision Europe, where the EBITDA margin
increased significantly from 5 percent in the first quarter to 11 percent in the
second quarter of 2010. Our North American business also continued to do well,
delivering a very solid 25 percent EBITDA margin in the second quarter.

In the second quarter, we continued to see positive effects from the launch of
CisionPoint as our most important business, Cision US, returned to organic
growth. The share of customers on the CisionPoint platform in the US has now
reached 78 percent as of June 30, 2010, compared with 48 percent one year ago.
As we continue to roll out CisionPoint in our other markets, we remain confident
in the long-term growth prospects for Cision.”

Cision empowers businesses to make better decisions and improve performance
through its CisionPoint software solutions for corporate communication and PR
professionals. Powered by local experts with global reach, Cision delivers
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Autonomy Corporation Plc Announces Interim Results for the Six Months Ended June 30, 2010

July 23, 2010 By Leave a Comment

CAMBRIDGE, England, July 22, 2010 /PRNewswire-FirstCall/ — Autonomy Corporation plc (LSE: AU. or AU.L), a global leader in infrastructure software, today reported financial results for the six months ended June 30, 2010.

QUARTERLY REPORT AND INTERIM RESULTS

Financial Highlights

– Record six month revenues of $415.3 million (within the
range of analyst expectations of $412-417m), up 28% from H1 2009 with
overall organic growth at 14%
– Six months organic IDOL revenue growth at 24%; organic
growth excluding professional services at 18%
– Gross profits (adj.) at $363.4 million, up 26% from H1 2009;
gross margins (adj.) at 88%
– H1 2010 operating margins (adj.) at 44%
– Record H1 profit before tax (adj.) at $182.7 million, up 24%
from H1 2009
– Record H1 fully diluted EPS (adj.) of $0.53 (within the
range of analyst expectations of $0.52-0.55), up 22% from H1 2009
(IFRS: $0.42, up 17%)
– Q2 DSOs decreased to 82 days (Q1 2010: 93 days, Q4 2009: 88 days)
– Cash conversion for the second quarter was 98% (Q2 2009:
66%), and for the first half of 2010 was 93% (H1 2009: 72%)

Commenting on the results, Dr Mike Lynch, Group CEO of Autonomy said today: “The first half of 2010 continued to show a gentle recovery with discretionary spend continuing. In considering the macro environment our customers are positive but still cautious. We saw continued positive moves in the ‘Power’ and OEM parts of our business. The ‘Promote’ area is starting to convert its great promise into sales as a lot of pre-recovery work is being undertaken by our customers and the ‘Protect’ part of the business has seen a number of high profile corporate and regulatory events underpin its continuing strength. The ability to understand the meaning of information and breadth of capabilities IDOL offers on a single platform meant that our competitive position remains strong and was recently recognised by independent analysts at IDC, who acknowledged Autonomy to be the world’s leading provider of archiving, search and discovery solutions.”

Dr Lynch continued: “The OEM business continues to be our fastest growing revenue stream, and we see a powerful networking effect underway as IDOL further penetrates the entire spectrum of enterprise software applications. The shift to new delivery models is ongoing and Autonomy continues to operate the world’s largest private cloud computing platform, with SaaS contributing over a quarter of Group revenues in the first half of 2010. We also continue to see a growing interest in our “Promote” solutions and we now see multi-million dollar deals in the pipeline for Meaning Based Marketing, where we believe there is pent-up demand. The strategic success of the recent MicroLink acquisition has already become apparent with a multi-million dollar contract signed directly with a US federal customer during the second quarter. Our government business, which is mainly focused on national security, has proved robust in the current climate of curtailed government expenditure and we do not expect to see any deterioration in this area.”

Dr Lynch concluded: “Given the continuation in the improvement of the macro environment, we took advantage of opportunities to improve the brand reach of the company by entering into new marketing arrangements. The robust demand backdrop and solid execution led to record revenues and EPS in the second quarter and first half of 2010, with strong cash generation. As in previous years, we expect to see the usual seasonality and unpredictability of the split of revenues between Q3 and Q4. Overall we face the rest of the year with a strong balance sheet, and in light of the continuing macro recovery, we are confident in our ability to continue to deliver strong growth for the full year.”

Six Month 2010 Highlights

– Record revenue of $415.3 million, up 28% from H1 2009
– Gross margins (adj.) in targeted range at 88%
– Record profit before tax (adj.) of $182.7 million, up 24%
from H1 2009 (IFRS: $136.3 million, up 12%)
– Operating margins (adj.) stable at 44% (H1 2009: 46%)
– Fully diluted EPS (adj.) of $0.53, up 22% from H1 2009
(IFRS: $0.42, up 17%)
– Positive cash flow generated by operations of $190.8 million
(H1 2009: $116.5 million), up 64%
– Six month cash conversion at 93%, above our target range

Second Quarter 2010 Highlights

– Record Q2 revenues of $221.1 million, up 13% from Q2 2009
despite negative FX effect of $0.8 million
– At constant currency, overall organic growth at 13%; organic
growth excluding professional services at 15%; and organic IDOL revenue
growth at 19%;
– Average selling price for meaning-based technologies at
$876,000 (Q2 2009: $722,000)
– Blue chip second quarter wins include Air Liquide, Amgen,
BNP Paribas, BP, Charles Schwab, Fortis Bank, HBO, Kraft, LG, Liberty
Mutual, Metlife, Michelin, Morgan Stanley, Precise, RWE, Sainsburys,
Starwood Hotels, Talk Talk, Ubisoft and Verizon, as well as significant
deals with multiple government, defence and intelligence agencies
around the globe including in Australia, the UK, USA and the
Netherlands
– Nine OEM deals signed including new deals and extensions
with Dassault Systemes, IBM, OpenText and Oracle
– Repeat business accounted for 49% of revenue in Q2 2010 (Q2
2009: 50%)
– Record Q2 profit before tax (adj.) of $97.3 million, up 9%
from Q2 2009
– Operating margins (adj.) stable at 44% (Q2 2009: 47%)
– Record Q2 fully diluted EPS (adj.) of $0.28, up 7% from Q2
2009 (IFRS: $0.21, up 2%)
– Deferred revenue increased to $175.5 million (Q1 2010:
$172.2 million, Q4 2009: $173.5 million)
– DSOs decreased significantly to 82 days (Q1 2010: 93 days,
Q4 2009: 88 days)

Revenues

Revenues for the six months ended June 30, 2010 totalled $415.3 million, up 28% from $325.0 million for the first six months of 2009 due to strong organic growth. During the first half of 2010 there were 44 deals over $1.0 million. In the first half of 2010, Americas revenues of $282.5 million represented 68% of total revenues, and Rest of World revenues of $132.8 million represented 32% of total revenues. Revenues for the second quarter of 2010 totalled $221.1 million, up 13% from $195.2 million for the second quarter of 2009 also due to strong organic growth.

Gross Profits and Gross Margins

Gross profits (adj.) for the six months ended June 30, 2010 were $363.4 million, up 26% from $288.6 million for the first six months of 2009. Gross margins (adj.) for the six months ended June 30, 2010 were 88%, compared to 89% for the first six months of 2009. Gross profits (IFRS) for the first six months of 2010 were $334.0 million, up 25% from $268.1 million for the first six months of 2009. Gross profits (adj.) for the second quarter of 2010 were $190.8 million, up 11% from $171.6 million for the second quarter of 2009. Gross margins (adj.) for the second quarter of 2010 were 86%, compared to 88% for the second quarter of 2009. Gross profits (IFRS) for the second quarter of 2010 were $175.9 million, up 12% from $156.5 million for the second quarter of 2009. The small variation in gross margins in Q2 2010 was in line with our expectations due to the sales mix including appliances as discussed last quarter.

Profit from Operations and Operating Margins

Profit from operations (adj.) for the six months ended June 30, 2010 was $182.7 million, up 22% from $150.2 million for the six months ended June 30, 2009. Operating margins (adj.) were 44% in the first half of 2010, compared to 46% in the first half of 2009. Profit from operations (IFRS) for the six months ended June 30, 2010 was $150.1 million, up 20% from $124.7 million for the six months ended June 30, 2009. Profit from operations (adj.) for the second quarter of 2010 was $96.5 million, up 5% from $92.2 million for the second quarter of 2009. Operating margins (adj.) were 44% in the second quarter of 2010, compared to 47% in the second quarter of 2009. Profit from operations (IFRS) for the second quarter of 2010 was $77.0 million, up 4% from $74.4 million for the second quarter of 2009.

Interest payable

Interest payable for the six months ended June 30, 2010 was $16.2 million, up from $3.3 million for the six months ended June 30, 2009. The increase is a result of a charge of $13.1 million in relation to the convertible loan notes issued in March 2010. The convertible loan notes pay a cash interest rate of 3.25%. However, the income statement charge is based on a market rate of interest for corporate loan notes of similar term without a convertible element in accordance with IFRS. This charge is excluded from the calculation of EPS in accordance with IFRS.

Interest payable for the quarter ended June 30, 2010 was $11.4 million, up from $2.8 million for the quarter ended June 30, 2009. The increase is primarily a result of a charge of $10.0 million in relation to the convertible loan notes.

Taxation

The full year effective tax rate for 2010 is 25%, down from 28% for the full year in 2009. The decrease follows the completion of the certain tax studies – as discussed last quarter – which has resulted in additional tax losses which will be utilised. The effective tax rate for the second quarter has fallen to 22% as a result of the change in the full year rate.

Foreign Exchange Impact

The effect on revenue in the first half of 2010 of movements in foreign exchange rates was negligible, a tailwind in the first quarter of 2010 was offset by a headwind in the second quarter of 2010.

The effect on revenue in the second quarter of 2010 of movements in foreign exchange rates was a decrease of approximately $0.8 million compared to the second quarter of 2009. In the second quarter of 2010 the U.S. Dollar strengthened slightly versus Sterling to an average of $1.49 versus $1.55 in the second quarter of 2009.

Net Profits

Net profit (adj.) for the six months ended June 30, 2010 was $137.2 million, or $0.53 per diluted share, compared to net profit (adj.) of $103.7 million, or $0.43 per diluted share, for the six months ended June 30, 2009. Net profit (IFRS) for the six months ended June 30, 2010 was $102.1 million, or $0.42 per diluted share, compared to net profit (IFRS) of $85.4 million, or $0.36 per diluted share, for the first half of 2009.

Net profit (adj.) for the second quarter of 2010 was $75.5 million, or $0.28 per diluted share, compared to net profit (adj.) of $63.6 million, or $0.26 per diluted share, for the second quarter of 2009. Net profit (IFRS) for the second quarter of 2010 was $52.4 million, or $0.21 per diluted share, compared to net profit (IFRS) of $50.9 million, or $0.21 per diluted share, for the second quarter of 2009.

IAS 38 Charges and Capitalization

Under IAS 38 the company is required to capitalize certain aspects of its research and development activities. R&D capitalization in the first half of 2010 was $16.3 million (H2 2009: $17.3 million) as a specific new product initiative moves towards launch earlier than anticipated. R&D capitalization for the first half of 2010 is offset by amortization charges of $7.4 million (H2 2009: $5.4 million) arising from historical R&D capitalization. The capitalization and offsetting charges resulted in a net credit (before tax) in the period of $8.9 million (H2 2009: $11.9 million), and a net margin impact of 2% (H2 2009: 3%).

Balance Sheet and Cash Flow

Cash balances were $962.0 million at June 30, 2010, an increase of $719.2 million from $242.8 million at December 31, 2009. Movements in cash flow during the first half year of 2010 of note included:

– Positive cash flow from operations of $190.8 million, up 64% from the
same period last year
– Tax payments of $36.8 million (H1 2009: $13.2 million), up sharply due
to the increased profitability of the Group
– Acquisition of MicroLink LLC and CA’s Information Governance Business
for combined consideration of $76.3 million;
– Purchase of fixed assets of $30.6 million due to continued expansion of
the Group’s data centres;
– Raising of $765.9 million from the convertible loan notes issue in
March 2010; and
– Repayment of $53.9 million of the Barclays term loan facility also in
March 2010.

Cash conversion for the six months ended June 30, 2010 was 93% (H1 2009: 72%). Trade receivables at June 30, 2010, were $211.6 million, compared to $230.2 million at December 31, 2010. Accounts receivable days sales outstanding were 82 days at June 30, 2010, compared to 88 days at December 31, 2009. $5.9 million of inventory from the beginning of the quarter was still to be delivered by the end of the quarter. Deferred revenues were $175.5 million at June 30, 2010, compared to $173.5 million at December 31, 2009 showing normal seasonality. Despite the difficult economic climate, bad debt write off in the quarter was less than 1% of revenues. Accrued income at June 30, 2010 was not material, at under 5% of revenues.

Supplemental Metrics

Autonomy is supplying supplemental metrics to assist in the understanding and analysis of Autonomy’s business.

Six Months Ended June 30, 2010

Cash conversion (H1 CFFO/H1 adj EBITDA**)…………………… 93%
Cash conversion (LTM CFFO/LTM adj EBITDA**)…………………. 89%
Product including hosted and OEM*………………………….$268m
IDOL Product $109m
IDOL Cloud $92m
Service revenues*…………………………………………$22m
Deferred revenue release (primarily maintenance)*……………$125m
OEM derived revenues*………………. $67m
OEM Dev…………………………………………………..$6m
OEM Ongoing………………………………………………$61m
Deals over $1 million……………………………………….44
Tax rate………………………………………………….25%
Available tax losses*………………………………….. $148m
LTM revenue with terms >365 days in normal range (<2% of revenues)
Accrued income in normal range (<5% of revenues)

Three Months Ended June 30, 2010
Cash conversion (Q2 CFFO/Q2 adj EBITDA**)........................ 98%
Cash conversion (Q2 CFFO/Q1 adj EBITDA**)........................107%
Product including hosted and OEM*...............................$147m
IDOL Product.....................................................$62m
IDOL Cloud.......................................................$47m
Service revenues*................................................$11m
Deferred revenue release (primarily maintenance)*................$63m
OEM derived revenues*............................................$38m
OEM Dev.........................................................$3m
OEM Ongoing....................................................$35m
Deals over $1 million..............................................25
Tax rate..........................................................22%
LTM revenue with terms >365 days in normal range (<2% of revenues)
Accrued income in normal range (<5% of revenues)

——–

* The above items are provided for background information and may
include qualitative estimates.
** Adj. EBITDA is defined as operating cash flow before movements in
working capital.

Q2 2010 Corporate Developments

During the second quarter of 2010 Autonomy continued to extend its market leadership with the introduction of key new and upgraded IDOL technologies, including the launches of:

– World’s first Social Media Governance platform, protecting
organisations across all social media channels;
– Industry’s first Meaning Based Rich Media Management platform; and
– Industry leading Meaning Based Multichannel Customer Interaction
Analytics Platform.

During the second quarter Autonomy was recognised in multiple ways for its market leadership and unmatched technology, including:

– Receiving Her Majesty The Queen’s Award for Enterprise in the category
of continuous achievement in international trade;
– Sushovan Hussain, CFO, was presented with FTSE 100 FD of the Year Award
at the FD’s Excellence Awards supported by the CBI; and
– Being rated by IDC as fastest-growing archiving software company and
the leading provider of search and discovery software.

Scheduling of Conference Call and Further Information

Autonomy’s results conference call will be available live at http://www.autonomy.com on July 22, 2010, at 9:30 a.m. BST/4:30 a.m. EST/1:30 a.m. PST.

From time to time the company answers investors’ questions on its website which may include information supplemental to that set forth above. Questions and answers can be found at: http://www.autonomy.com/investors/questions.

Risk Factors as Required by DTR 4.2.7(2)

As with all businesses, the Group is affected by certain risks, not wholly within our control, which could have a material impact on the Group’s long term performance and could cause actual results to differ materially from forecast and historic results.

The principal risks and uncertainties facing the Group have not changed from those set out in the company’s most recent prospectus, which does not form part of these interim statements. These include: dependence on our core technology; competition; levels of operational spending versus revenues; average selling price; economic and market conditions; reliance on value added resellers; continued service of our executive directors; hiring and retention of qualified personnel; product errors or defects; problems encountered in connection with potential acquisitions; and intellectual property claims.

In addition to the foregoing, the primary risk and uncertainty related to the Group’s performance for the remainder of the year is the continuing uncertain macro economic environment, which could have a material impact on the Group’s performance over the remaining six months of the financial year and could cause actual results to differ materially from expected and historical results. This effect has been offset during the first six months of the year to some extent by emerging signs of economic stability and continuing legal, regulatory and compliance issues which have arisen for enterprises in connection with the current economic environment.

About Autonomy Corporation plc

Autonomy Corporation plc (LSE: AU. or AU.L), a global leader in infrastructure software for the enterprise, spearheads the Meaning Based Computing movement. IDC recently recognized Autonomy as having the largest market share and fastest growth in the worldwide search and discovery market. Autonomy’s technology allows computers to harness the full richness of human information, forming a conceptual and contextual understanding of any piece of electronic data, including unstructured information, such as text, email, web pages, voice, or video. Autonomy’s software powers the full spectrum of mission-critical enterprise applications including pan-enterprise search, customer interaction solutions, information governance, end-to-end eDiscovery, records management, archiving, business process management, web content management, web optimization, rich media management and video and audio analysis.

Autonomy’s customer base is comprised of more than 20,000 global companies, law firms and federal agencies including: AOL, BAE Systems, BBC, Bloomberg, Boeing, CitiGroup, Coca Cola, Daimler AG, Deutsche Bank, DLA Piper, Ericsson, FedEx, Ford, GlaxoSmithKline, Lloyds Bank, NASA, Nestle, the New York Stock Exchange, Reuters, Shell, Tesco, T-Mobile, the U.S. Department of Energy, the U.S. Department of Homeland Security and the U.S. Securities and Exchange Commission. More than 400 companies OEM Autonomy technology, including Symantec, Citrix, HP, Novell, Oracle, Sybase and TIBCO. The company has offices worldwide. Please visit http://www.autonomy.com to find out more.

Autonomy and the Autonomy logo are registered trademarks or trademarks of
Autonomy Corporation plc. All other trademarks are the property of their
respective owners.

AUTONOMY CORPORATION plc
CONDENSED CONSOLIDATED INCOME STATEMENT
(in thousands, except per share amounts)

Three Months Six Months Ended
Ended
(unaudited) (unaudited)
June 30, June 30, June 30, June 30,
2010 2009 2010 2009
Continuing operations $’000 $’000 $’000 $’000
Revenues (see note 4)……………221,125 195,192 415,305 324,971
Cost of revenues (excl.
amortization). (30,323) (23,628) (51,865) (36,417)
Amortization of purchased
intangibles (14,898) (15,105) (29,432) (20,459)
Total cost of revenues…………..(45,221) (38,733) (81,297) (56,876)
Gross profit………………….. 175,904 156,459 334,008 268,095
Operating expenses:
Research and development…………(27,741) (28,781) (55,523) (48,791)
Sales and marketing……………..(50,557) (37,110) (93,457) (65,870)
General and administrative ………(17,264) (15,508) (34,519) (26,796)
Other costs…………………….
Post-acquisition restructuring
costs………………………… (558) – (558) (846)
(Loss) profit on foreign exchange..(2,777) (694) 184 (1,127)
Total operating expenses…………(98,897) (82,093) (183,873) (143,430)
Profit from operations……………77,007 74,366 150,135 124,665
Share of loss of associate……….. (333) (85) (671) (526)
Interest receivable……………….2,178 168 2,985 791
Interest payable………………..(11,372) (2,757) (16,169) (3,261)
Profit before income taxes………..67,480 71,692 136,280 121,669
Income taxes (see note 5)………..(15,129) (20,817) (34,215) (36,278)
Net profit………………………52,351 50,875 102,065 85,391
Basic earnings per share
(see note 7)……………………$ 0.22 $ 0.21 $ 0.42 $ 0.36
Diluted earnings per share
(see note 7)…………………….$ 0.21 $ 0.21 $ 0.42 $ 0.36

Reconciliation of Adjusted Financial Measures

Three Months Six Months Ended
Ended
(unaudited) (unaudited)
June 30, June 30, June 30, June 30,
2010 2009 2010 2009
$’000 $’000 $’000 $’000
Gross profit …………………….175,904 156,459 334,008 268,095
Amortization of purchased intangibles 14,898 15,105 29,432 20,459
Gross profit (adjusted)……………190,802 171,564 363,440 288,554

Profit before income taxes………….67,480 71,692 136,280 121,669
Amortization of purchased intangibles 14,898 15,105 29,432 20,459
Share-based compensation (see note 6)…1,273 2,007 2,767 3,131
Post-acquisition restructuring costs…. 558 – 558 846
Loss (profit) on foreign exchange…….2,777 694 (184) 1,127
Interest payable on convertible
loan notes………………………..10,019 – 13,138 -
Share of loss of associate………….. 333 85 671 526
Profit before income taxes (adjusted)..97,338 89,583 182,662 147,758
Income taxes (adjusted)……………(21,823) (26,012) (45,493) (44,009)
Net profit (adjusted)………………75,515 63,571 137,169 103,749

Profit from operations……………..77,007 74,366 150,135 124,665
Amortization of purchased intangibles 14,898 15,105 29,432 20,459
Share-based compensation (see note 6).. 1,273 2,007 2,767 3,131
Post-acquisition restructuring costs…. 558 – 558 846
Loss (profit) on foreign exchange…….2,777 694 (184) 1,127
Profit from operations (adjusted)……96,513 92,172 182,708 150,228

AUTONOMY CORPORATION plc
CONDENSED CONSOLIDATED BALANCE SHEET

As at
(unaudited)
June 30, Dec. 31,
2010 2009
$’000 $’000
ASSETS
Non-current assets:
Goodwill……………………………………. 1,358,397 1,287,042
Other intangible assets………………………. 407,475 399,277
Property and equipment, net…………………… 28,918 33,886
Equity and other investments………………….. 29,944 16,608
Deferred tax asset…………………………… 19,705 24,015
Total non-current assets……………………… 1,844,439 1,760,828
Current assets:
Trade receivables, net……………………….. 211,616 230,219
Other receivables……………………………. 54,442 45,231
Total trade and other receivables 266,058 275,450
Inventory…………………………………… 5,908 486
Cash and cash equivalents…………………….. 961,992 242,791
Total current assets…………………………. 1,233,958 518,727
TOTAL ASSETS………………………………… 3,078,397 2,279,555

CURRENT LIABILITIES
Trade payable……………………………….. (22,643) (14,926)
Other payables………………………………. (36,822) (54,517)
Total trade and other payables…. (59,465) (69,443)
Bank loan…………………………………… (78,358) (52,375)
Tax liabilities……………………………… (44,901) (43,338)
Deferred revenue…………………………….. (170,718) (164,931)
Provisions………………………………….. (2,113) (2,731)
Total current liabilities…………………….. (355,555) (332,818)
Net current assets…………………………… 878,403 185,909

NON-CURRENT LIABILITIES
Bank loan…………………………………… (66,083) (145,152)
Convertible loan notes……………………….. (654,954) -
Deferred tax liabilities……………………… (74,609) (85,087)
Deferred revenue…………………………….. (4,751) (8,576)
Other payables………………………………. (1,693) (1,020)
Provisions………………………………….. (4,450) (5,123)
Total non-current liabilities…………………. (806,540) (244,958)
Total liabilities……………………………. (1,162,095) (577,776)
NET ASSETS………………………………….. 1,916,302 1,701,779

Shareholders’ equity:
Ordinary shares (1)………………………….. 1,339 1,333
Share premium account………………………… 1,241,809 1,130,767
Capital redemption reserve……………………. 135 135
Own shares………………………………….. (788) (845)
Merger reserve………………………………. 27,589 27,589
Stock compensation reserve……………………. 24,669 21,959
Revaluation reserve………………………….. 16,601 4,499
Translation reserve………………………….. (27,343) (12,032)
Retained earnings……………………………. 632,291 528,374
TOTAL EQUITY………………………………… 1,916,302 1,701,779

————

(1) At June 30, 2010, 600,000,000 ordinary shares of nominal value 1/3
pence each authorized, 241,833,190 issued and outstanding; as of
December 31, 2009, 600,000,000 ordinary shares of nominal value 1/3
pence each authorized, 240,574,304 issued and outstanding.

AUTONOMY CORPORATION plc
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

Three Months Six Months Ended
Ended
(unaudited) (unaudited)
June 30, June 30, June 30, June 30,
2010 2009 2010 2009
$’000 $’000 $’000 $’000
Cash flows from operating activities:
Profit from operations……………77,007 74,366 150,135 124,665
Adjustments for:
Depreciation and amortization……..26,438 22,081 53,069 32,624
Share based compensation…………. 1,273 2,007 2,767 3,131
Foreign currency movements……….. 2,777 694 (184) 1,127
Post-acquisition restructuring costs. 357 – 357 596
Other non-cash items…………….. – – – 126
Operating cash flows before
movements in working capital……..107,852 99,148 206,144 162,269
Changes in operating assets and
liabilities (net of impact of
acquisitions):
Receivables…………………… 5,274 (36,349) 6,852 (44,841)
Inventories…………………… 4,342 (77) (5,425) 170
Payables……………………..(12,179) 2,671 (16,806) (1,064)
Cash generated by operations……..105,289 65,393 190,765 116,534
Income taxes paid……………….(13,039) (2,370) (36,819) (13,151)
Net cash provided by operating
activities…………………….. 92,250 63,023 153,946 103,383

Cash flows from investment activities:
Interest received……………….. 2,095 168 2,316 791
Purchase of fixed assets…………(12,960) (291) (30,583) (4,364)
Purchase of investments………….. – (1,172) (2,500) (2,152)
Expenditure on product development…(9,721) (4,115) (16,294) (7,399)
Acquisition of subsidiaries,
net of cash acquired…………….(21,977) (10,160) (77,929) (620,923)
Net cash used in investing
activities….. (42,563) (15,570) (124,990) (634,047)

Cash flows from financing activities:
Proceeds from issuance of shares,
net of issuance costs……………. 5,665 5,106 12,830 12,861
Proceeds from share placing,
net of issuance costs……………. – – – 308,512

Proceeds from convertible loan
notes, net of issuance costs……… – – 765,912
Interest on bank loan……………. (980) (2,297) (2,252) (2,498)
Repayment of bank loan…………… – (37,450) (53,906) (37,450)
Drawdown of bank loan……………. – – – 200,000
Payment of arrangement fee……….. – (346) – (3,846)
Net cash provided by (used in)
financing activities…………….. 4,685 (34,987) 722,584 477,579

Net increase (decrease) in cash
and cash equivalents……………..54,372 12,466 751,540 (53,085)
Beginning cash and cash
equivalents…………………….910,876 132,315 242,791 199,218
Effect of foreign exchange
on cash and cash equivalents…….. (3,256) 7,768 (32,339) 6,416
Ending cash and cash equivalents….961,992 152,549 961,992 152,549

AUTONOMY CORPORATION plc
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

Three Months Six Months
Ended Ended
(unaudited) (unaudited)
June June June June
30, 30, 30, 30,
2010 2009 2010 2009
$’000 $’000 $’000 $’000

Net profit………………………….52,351 50,875 102,065 85,391

Revaluation of equity investment…….. 14,913 (810) 12,102 584
Translation of overseas operations… (1,019) 14,272 (15,311) 14,334
Other comprehensive income…………. 13,894 13,462 (3,209) 14,918
Total comprehensive income………….. 66,245 64,337 98,856 100,309

AUTONOMY CORPORATION plc
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

Capital
Ordinary Share redemption Own Merger
shares premium reserve shares reserve Sub-total
$’000 $’000 $’000 $’000 $’000 $’000

At January 1, 2010….1,333 1,130,767 135 (845) 27,589 1,158,979
Retained profit………..- – – – – -
Other comprehensive
income………………..- – – – – -
Stock compensation……..- – – – – -
Share options exercised…6 13,227 – – – 13,233
EBT options exercised…..- – – 57 – 57
Equity element of
convertible loan notes….- 97,815 – – – 97,815
Deferred tax on
stock options………….- – – – – -
At June 30, 2010……1,339 1,241,809 135 (788) 27,589 1,270,084

Stock
Sub-total comp’n Revaluation
Forwarded reserve reserve
$’000 $’000 $’000
At January 1, 2010……………………..1,158,979 21,959 4,499
Retained profit……………………….. – – -
Other comprehensive income……………… – – 12,102
Stock compensation…………………….. – 2,767 -
Share options exercised………………… 13,233 – -
EBT options exercised………………….. 57 (57) -
Equity element of convertible loan
notes………………………………… 97,815 – -
Deferred tax on stock options…………… – – -
At June 30, 2010……………………….1,270,084 24,669 16,601

(table continued)

Translation Retained
reserve earnings Total
$’000 $’000 $’000
At January 1, 2010…………………….. (12,032) 528,374 1,701,779
Retained profit……………………….. – 102,065 102,065
Other comprehensive income……………… (15,311) – (3,209)
Stock compensation…………………….. – – 2,767
Share options exercised………………… – – 13,233
EBT options exercised………………….. – – -
Equity element of convertible loan notes…. – – 97,815
Deferred tax on stock options…………… – 1,852 1,852
At June 30, 2010………………………. (27,343) 632,291 1,916,302

Capital
Ordinary Share redemption Own Merger
shares premium reserve shares reserve Sub-total
$’000 $’000 $’000 $’000 $’000 $’000

At January 1, 2009….1,214 798,279 135 (905) 27,589 826,312
Retained profit………..- – – – – -
Other comprehensive
income………………..- – – – – -
Stock compensation……..- – – – – -
Issuance of shares……111 321,010 – – – 321,121
EBT options exercised…..- – – 2 – 2
Deferred tax movement…..- – – – – -
At June 30, 2009……1,325 1,119,289 135 (903) 27,589 1,147,435

Sub-total Stock comp’n Revaluation
Forwarded reserve reserve
$’000 $’000 $’000

At January 1, 2009……………… 826,312 14,846 2,987
Retained profit………………… – – -
Other comprehensive income………. – – 584
Stock compensation……………… – 3,131 -
Issuance of shares……………… 321,121 – -
EBT options exercised…………… 2 (2) -
Deferred tax movement…………… – – -
At June 30, 2009………………..1,147,435 17,975 3,571

(table continued)

Translation Retained
reserve earnings Total
$’000 $’000 $’000

At January 1, 2009………………….(18,261) 294,016 1,119,900
Retained profit……………………. – 85,391 85,391
Other comprehensive income………….. 14,334 – 14,918
Stock compensation…………………. – – 3,131
Issuance of shares…………………. – – 321,121
EBT options exercised………………. – – -
Deferred tax movement………………. – 18,291 18,291
At June 30, 2009…………………… (3,927) 397,698 1,562,752

The accompanying notes are an integral part of these consolidated financial statements

AUTONOMY CORPORATION plc

NOTES TO THE CONDENSED SET OF CONSOLIDATED FINANCIAL STATEMENTS FOR THE
SIX MONTHS ENDED JUNE 30, 2010 – UNAUDITED

1. General information

Interim information is unaudited, but reflects all normal adjustments which are, in the opinion of management, necessary to provide a fair statement of results and the company’s financial position for and as at the periods presented. The results of operations for the three and six months ended June 30, 2010 are not necessarily indicative of the operating results for future operating periods. The interim financial statements should be read in connection with the company’s audited Consolidated Financial Statements and the notes thereto for the year ended December 31, 2009. The information for the year ended December 31, 2009 does not constitute statutory accounts as defined in section 435 of the Companies Act 2006. A copy of the statutory accounts for that year has been delivered to the Registrar of Companies. The auditors reported on those accounts; their report was unqualified, did not draw attention to any matters by way of emphasis and did not contain a statement under section 498(2) or (3) of the Companies Act 2006.

2. Accounting policies

The annual financial statements of Autonomy Corporation plc are prepared in accordance with IFRSs as adopted by the European Union. The condensed set of financial statements included in this half yearly report has been prepared in accordance with IAS 34 ‘Interim Financial Reporting’ as adopted by the European Union.

Basis of preparation

The same accounting policies, presentation and methods of computation are followed in the condensed set of consolidated financial statements as applied in the Group’s 2009 Annual Report, except for certain reclassifications between cost categories to ensure consistency across the Group, and as described below.

Adoption of new and current standards

The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those followed in the preparation of the Group’s financial statements for the year ended 31 December 2009, except for the adoption of new standards and interpretations. In the current financial year, the Group has adopted International Financial Reporting Standard 3 (Revised 2008) “Business Combinations” and International Accounting Standard 27 (Revised 2008) “Consolidated and Separate Financial Statements” as required, and will apply these principles throughout the year. Adoption of these standards did not have any significant effect on the financial position or performance of the Group.

Going Concern

The Group has considerable financial resources together with a significant number of customers across different geographic areas and industries. At June 30, 2010 the Group had cash balances of $962 million and total debt of $799 million. The Group has no net debt. As a consequence, the directors believe that the Group is well placed to manage business risks successfully despite the current uncertain economic outlook.

After making enquiries and considering the cash flow forecasts of the Group the directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the six month and quarterly consolidated financial statements

Adjusted Results

Although IFRS disclosure provides investors and management with an overall view of the company’s financial performance, Autonomy believes that it is important for investors to also understand the performance of the company’s fundamental business without giving effect to certain specific, non-recurring and non-cash charges. Consequently, the non-IFRS (adj.) results exclude share of profit/loss of associates, post-acquisition restructuring costs and non-cash charges for the amortization of purchased intangibles, share-based compensation, interest on convertible loan notes, non-cash translational foreign exchange gains and losses and associated tax effects. Management uses the adjusted results to assess the financial performance of the company’s operational business activities.

See reconciliations on page 7.

3. Acquisitions of MicroLink and Information Governance business

During the first half of 2010 we have completed the acquisitions of MicroLink LLC (100% of share capital acquired) and CA’s Information Governance business (asset purchase). The acquisition of MicroLink LLC is intended to accelerate the adoption of Autonomy technology in the important and growing area of US government expenditure. The acquisition of CA’s Information Governance business strengthens Autonomy’s position of the leader in Meaning Based Governance.

Total consideration paid was $76 million, all of which was paid in cash. Net assets acquired were $1 million, giving rise to goodwill of $75 million. Acquisition costs for each acquisition have been included as costs in the income statement in accordance with IFRS 3 Revised.

The purchase price allocation has not yet been finalised although we expect the independent valuation reports to be completed during the second half of 2010. Management’s provisional purchase price allocation has attributed a value of $12 million to purchased intangibles based on comparable transactions. It is not practicable to determine the effect of the acquisitions for the period from acquisition to the end of the financial period. The company’s core products and those of the acquired entities have been integrated and the operations merged such that it is not practicable to determine the portion of the result that specifically relates to the acquired entities on a stand-alone basis.

4. Segmental information

The Company is organized internally along Group function lines with each line reporting to the Group’s chief operating decision maker, the Chief Executive Officer. The primary Group function lines include: finance; operations, including legal, HR and operations; marketing; sales; and technology. Each of these functions supports the overall business activities, however they do not engage in activities from which they earn revenues or incur expenditure in their operations with each other. No discrete financial information is produced for these function lines. The company integrates acquired businesses and products into the Autonomy model such that separate financial data on these entities is not maintained post acquisition.

The Group has operations in various geographic locations however no discrete financial information is maintained on a regional basis. Decisions around the allocation of resources are not determined on a regional basis and the chief operating decision maker does not assess the Group’s performance on a geographic basis.

The Group is a software business that utilises its single technology in a set of standard products to address unique business problems associated with unstructured data. The Group offers over 500 different functions and connectors to over 400 different data repositories as part of its product suite. Each customer selects from a list of options, but underneath from a single unit of the proprietary core technology platform. As a result, no analysis of revenues by product type can be provided.

Each of the Group’s virtual brands is founded on the Group’s unique Intelligent Data Operating Layer (IDOL), the Group’s core infrastructure for automating the handling of all forms of unstructured information. Separate financial information is not prepared for each virtual brand to assess its performance for the purpose of resource allocation decisions. The pervasive nature of the Group’s technology across each brand requires decisions to be taken at the Group level and financial information is prepared on that basis.

A significant proportion of the Group’s cost base is fixed and represents payroll and property costs which relate to the multiple function lines of the Group. As a result the business model drives enhanced performance though growing sales and accordingly Group wide revenue generation is the key performance metric that is monitored by the chief operating decision maker. The revenue financial data used to monitor performance is prepared and compiled on a Group wide basis. No separate revenue financial analysis is maintained on revenues from any of the virtual brands.

The Company’s chief operating decision maker is the Group’s Chief Executive Officer, who evaluates the performance of the Company on a Group wide basis and any elements within it on the basis of information from junior executives and Group financial information and is ultimately responsible for entity-wide resource allocation decisions.

As a consequence of the above factors the Group has one operating segment in accordance with IFRS 8 “Operating Segments”. IFRS 8 also requires information on a geographic basis and that information is shown below. The Group’s operations are located primarily in the United Kingdom, the US and Canada. The company also has a significant presence in a number of other European countries as well as China, Japan, Singapore and Australia. The following tables provide an analysis of the Group’s sales and net assets by geographical market based upon the location of the Group’s customers.

Three Months Six Months
Ended Ended
(unaudited) (unaudited)
June 30, June 30, June 30, June 30,
2010 2009 2010 2009
Revenue by region: $’000 $’000 $’000 $’000

Americas…………………………146,874 133,928 282,469 219,111
Rest of World……………………..74,251 61,264 132,836 105,860

Total……………………………221,125 195,192 415,305 324,971

Information about these geographical regions is presented below:

Three Months Ended
(unaudited)
June 30, 2010 June 30, 2009
Americas ROW Total Americas ROW Total
$’000 $’000 $’000 $’000 $’000 $’000
Result by region………56,738 23,604 80,342 57,930 17,130 75,060
Post-acq’n restr. costs.. (558) -
Profit (loss) on foreign
exch………………… (2,777) (694)
Operating profit……… 77,007 74,366
Share of loss of
associate……………. (333) (85)
Interest receivable…… 2,178 168
Interest payable……… (11,372) (2,757)
Profit before tax…….. 67,480 71,692
Tax…………………. (15,129) (20,817)
Profit for the period…. 52,351 50,875

Six Months Ended
(unaudited)
June 30, 2010 June 30, 2009
Americas ROW Total Americas ROW Total
$’000 $’000 $’000 $’000 $’000 $’000
Result by region……..112,222 38,287 150,509 96,459 30,179 126,638
Post-acq’n restr. costs. (558) (846)
Profit (loss) on foreign
exch……………….. 184 (1,127)
Operating profit…….. 150,135 124,665
Share of loss of
associate…………… (671) (526)
Interest receivable….. 2,985 791
Interest payable…….. (16,169) (3,261)
Profit before tax……. 136,280 121,669
Tax………………… (34,215) (36,278)
Profit for the period… 102,065 85,391

5. Income taxes
Three Months Six Months
Ended Ended
(unaudited) (unaudited)
June 30, June 30, June 30, June 30,
2010 2009 2010 2009
Tax charge by region: $’000 $’000 $’000 $’000

UK………………………………. 9,901 12,901 23,300 20,344
Foreign………………………….. 5,228 7,916 10,915 15,934
Total…………………………..15,129 20,817 34,215 36,278

6. Share based compensation

Share based compensation charges have been charged in the consolidated
income statement within the following functional areas:

Three Months Six Months
Ended Ended
(unaudited) (unaudited)
June 30, June 30, June 30, June 30,
2010 2009 2010 2009
$’000 $’000 $’000 $’000
Research and development…………… 342 539 743 841
Sales and marketing……………….. 624 984 1,357 1,535
General and administra ……………. 307 484 667 755
Total share based compensation charge.. 1,273 2,007 2,767 3,131

7. Earnings per share

The calculation of the basic and diluted earnings per share is based on
the following data:

Three Months Six Months
Ended Ended
(unaudited) (unaudited)
June June June June
30, 30, 30, 30,
2010 2009 2010 2009
$’000 $’000 $’000 $’000
Earnings for purpose of basic and
diluted earnings per share, being
net profit (IFRS)…………………….52,351 50,875 102,065 85,391

Earnings for the purposes of diluted
earnings per share (adjusted -
see page 7)………………………….75,515 63,571 137,169 103,749

Number of shares (in thousands)
Weighted average number of ordinary
shares for the purposes of basic
earnings per share…………………..241,587 238,815 241,239 235,279

Share options…………………………3,308 4,094 3,114 3,707

Weighted average number of ordinary
shares for the purposes of diluted
earnings per share (IFRS)…………. 244,895 242,909 244,353 238,986

Convertible loan notes………………..24,082 – 15,700 -
Weighted average number of ordinary
shares for the purposes of diluted
earnings per share (adjusted)…… 268,977 242,909 260,053 238,986

IFRS
Earnings per share – basic…………….$ 0.22 $ 0.21 $ 0.42 $ 0.36
Earnings per share – fully diluted……..$ 0.21 $ 0.21 $ 0.42 $ 0.36

Adjusted
Earnings per share adj. – basic (IFRS)….$ 0.31 $ 0.27 $ 0.57 $ 0.44
Earnings per share adj.- fully
diluted (IFRS) ………………………$ 0.31 $ 0.26 $ 0.56 $ 0.43
Earnings per share adj. – fully diluted
(adjusted for conversion of loan notes)…$ 0.28 $ 0.26 $ 0.53 $ 0.43

Because in our adjusted measure of profits, we exclude the interest payable on the convertible loan notes, the inclusion of the potential shares for the convertible loan notes does cause dilution. In order to give a fair presentation of our adjusted diluted earnings per share, we have elected to reflect the impact of the convertible shares within our adjusted diluted earnings per share measures.

8. Related Party Transactions

There have been no related party transactions, or changes in related party transactions described in the latest annual report, that could have a material effect on the financial position or performance of the Group in the financial period.

————————————————

Statement of Directors’ Responsibility

We confirm that to the best of our knowledge:

(a) the condensed set of financial statements has been prepared in
accordance with IAS 34 “Interim Financial Reporting”;

(b) the interim management report includes a fair review of the
information required by DTR 4.2.7 (indication of important events
during the first six months and description of principal risks and
uncertainties for the remaining six months of the year); and

(c) the interim management report includes a fair review of the
information required by DTR 4.2.8 (disclosure of related parties’
transactions and changes therein).

By order of the Board

Dr Michael R Lynch Sushovan T Hussain
Chief Executive Officer Chief Financial Officer
July 22, 2010 July 22, 2010

INDEPENDENT REVIEW REPORT TO AUTONOMY CORPORATION PLC

We have been engaged by the Company to review the condensed set of financial statements in the interim financial report for the three and six months ended June 30, 2010 which comprises the condensed consolidated income statement, the condensed consolidated balance sheet, the condensed consolidated statement of comprehensive income, the condensed consolidated statement of changes in equity, the condensed consolidated statement of cash flow and related notes 1 to 8. We have read the other information contained in the interim financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.

This report is made solely to the company in accordance with International Standard on Review Engagements (UK and Ireland) 2410 “Review of Interim Financial Information Performed by the Independent Auditor of the Entity” issued by the Auditing Practices Board. Our work has been undertaken so that we might state to the company those matters we are required to state to them in an independent review report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company, for our review work, for this report, or for the conclusions we have formed.

Directors’ responsibilities

The interim financial report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the interim financial report in accordance with the Disclosure and Transparency Rules of the United Kingdom’s Financial Services Authority.

As disclosed in note 2 the annual financial statements of the Group are prepared in accordance with IFRSs as adopted by the European Union. The condensed set of financial statements included in this interim financial report has been prepared in accordance with International Accounting Standard 34, “Interim Financial Reporting,” as adopted by the European Union.

Our responsibility

Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the interim financial report based on our review.

Scope of Review

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410 “Review of Interim Financial Information Performed by the Independent Auditor of the Entity” issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the interim financial report for the three and six months ended June 30, 2010 is not prepared, in all material respects, in accordance with International Accounting Standard 34 as adopted by the European Union and the Disclosure and Transparency Rules of the United Kingdom’s Financial Services Authority.

Deloitte LLP

Chartered Accountants and Statutory Auditors
Cambridge, UK
July 22, 2010

Financial Media Contacts:
Edward Bridges / Haya Herbert-Burns
Financial Dynamics
+44(0)20-7831-3113

Analyst and Investor Contacts:
Derek Brown, Head of IR
Autonomy Corporation plc
+44(0)207-907-2300

Filed Under: International News Tagged With: , , , , , , , , , , , , , , , , , , ,

MEDICA: First-Half 2010 Business Review

July 21, 2010 By Leave a Comment

* MEDICA continued to drive faster growth

€259.1 million in H1-2010 revenue up 10.7% on H1 2009
PARIS–(Business Wire)–
Regulatory News:

MEDICA (Paris: MDCA), a leading provider of long and short-term dependency care
in France, has released its business review for the six months ended 30 June
2010.

H 1 Q 2
REVENUE 2010 2009 Reported Organic 2010 2009 Reported Organic
BY SECTOR – €M growth growth growth growth
Long-term care – France 160.8 139.7 +15.2% +8.8% 82.2 70.9 +15.9% +8.9%
% of revenue 62.1% 59.7% 62.3% 59.8%
Post-acute and psychiatric care – France 71.6 70.1 +1.9% +1.9% 36.2 35.3 +2.7% +2.7%
% of revenue 27.6% 30.0% 27.5% 29.8%
Italy 26.6 24.3 +9.4% +3.1% 13.5 12.3 +9.3% +2.8%
% of revenue 10.3% 10.4% 10.2% 10.4%
TOTAL 259.1 234.1 +10.7% +6.1% 131.9 118.5 +11.3% +6.2%
Unaudited figures

“We are satisfied with the growth in MEDICA`s business in the first half of
2010,” said Jacques Bailet, Chairman and Chief Executive Officer.”During the
period, our revenue rose by 10.7% compared with the first half of 2009, with
organic growth exceeding 6%.This positive first-half performance has
strengthened our confidence in our growth strategy and, in particular, our
ability to reach our revenue growth targets of at least 10% for 2010 and an
aggregate 45% for the 2010-2012 period.”

REVENUE

Consolidated revenue amounted to €259.1 million in the first half of 2010,
representing a 10.7% increase from the prior-year period. For the second quarter
alone, revenue came to €131.9 million, up 11.3% from the €118.5 million reported
in second-quarter 2009.

MEDICA drove robust expansion in its business in the first half, opening 247
beds and acquiring 770 beds. As of the date of this press release, MEDICA
operated a portfolio of 12,300 beds.

All of the business segments experienced growth during the period:

* Revenue from long-term care in France rose by 15.2% to €160.8 million, mainly
reflecting the strong 8.8% organic growth led by the ramp-up of facilities
opened in 2009 and first-half 2010.
* Revenue from post-acute and psychiatric care facilities in France edged up by
a slight 1.9% to €71.6 million, as the Group`s deployment of in-depth
restructuring plans held back expansion.
* Revenue from operations in Italy rose by 9.4% year-on-year.

Occupancy rates in Group facilities remained high, at 96.9%.

FIRST-HALF HIGHLIGHTS

* New financing facilities were set up during the period, as follows:

On 16 June 2010, MEDICA signed a club deal with a syndicate of leading banks.

The deal provides for a term loan facility in an amount of €350 million, used to
refinance existing syndicated loans at a reduced spread of 165 bps versus 270
bps previously.

In addition, the Group has access to:

* A revolving loan facility in an amount of €100 million, providing MEDICA with
additional financing to support its controlled growth strategy.
* An additional €150-million basket of bilateral debt facilities, authorized by
the banking documentation.

The new facilities will enable MEDICA to significantly reduce its borrowing
costs, while providing financing aligned with the Group`s growth strategy.

* The interest rate hedging policy was adjusted, as follows:

As announced when the new financing was arranged, the Group recently adjusted
its interest rate hedging policy to further optimise its borrowing costs.

The Group entered into a fixed-rate swap agreement with effect from 1 January
2011 and based on an amount of €350 million, of which €100 million expires on 31
December 2013 and €250 million on 30 June 2014.

Since January 2011, the fixed rate on the new swaps represents an average of
approximately 1.7%, which is 200 bps lower than the rate on the existing swaps.

DEVELOPMENT

To support its expansion plan, the Group also has an organic growth pipeline
representing some 2,700 beds (excluding beds with an option to buy), as
follows:

* 850 beds being restructured.
* 1,850 beds being built.

OUTLOOK

Management reaffirms the objective set during the initial public offering to
deliver revenue growth of at least 10% in 2010 and at least 45% over the
2010-2012 period. This performance will be driven by deploying an active capital
expenditure and investment strategy, to maintain the high quality and
profitability of existing facilities, create new facilities and carry out
carefully selected acquisitions. Management also intends to lead this growth
strategy while further improving the company’s leverage (net debt to EBITDA
ratio) to around 3x in 2012.

A conference call for analysts and investors will be held this morning at 9:00
am CEST.

INVESTOR CALENDAR

First-half 2010 results: Tuesday, 7 September 2010 before start of trading
Third-quarter 2010 business review: Tuesday, 26 October 2010 before start of trading

ABOUT MEDICA

Created in 1968, MEDICA is a leading provider of long and short-term dependency
care in France. It operates in both the long-term care sector, with 111 nursing
homes in France and Italy, and in the post-acute and psychiatric care sector,
with 37 post-op and rehabilitation facilities in France. Together, these
facilities offered a total of 11,381 beds at 31 December 2009.

MEDICA has been listed on the NYSE Euronext Paris stock exchange – Compartment B
since February 2010. Eligible for the Deferred Settlement Service.

MEDICA is included in the CAC Mid 100, SBF 250 and MSCI France Small Cap
indices.

Symbol: MDCA – ISIN: FR0010372581 – Reuters: MDCA PA – Bloomberg: MDCA FP

Website: www.groupemedica.com

INVESTOR RELATIONS
MEDICA
Christine Jeandel – Deputy Chief Executive Officer
christine.jeandel@medicafrance.fr
or
Mathieu Fabre – Chief Financial Officer
mathieu.fabre@medicafrance.fr
Phone: +33 (0)1 41 09 95 20
or
LT Value
Nancy Levain/Maryline Jarnoux-Sorin
Phone: +33 (0)1 44 50 39 30
LTvalue@LTvalue.com
or
MEDIA RELATIONS
Brunswick
Agnès Catineau
Phone: +33 (0)1 53 96 83 83
Medica@brunswickgroup.com

Copyright Business Wire 2010

Filed Under: International News Tagged With: , , , , , , , , , , , , , , , , , , ,

Retail banks making less from customers

July 20, 2010 By Leave a Comment

(Reuters) – Retail banks are making less profit on average from customers since the financial crisis as price-sensitive consumers shop around and become more demanding, according to a report released on Monday.

The study by consultancy Accenture found that nearly half of top global retail banks had seen the average profit from customers fall between 5 and 15 percent. A further 11 percent said they had seen bigger declines.

Of the 46 executives interviewed for the study, more than half said customer loyalty had decreased. Most expected the lack of customer loyalty to continue in the long term.

“Consumers (are) more skeptical of their bank brands, more price conscious, and more willing to move away from institutions that provide poor service,” said co-author Noel Gordon, global managing director of Accenture’s banking industry practice.

“For the banks, traditional profit-recovery strategies — rate and fee increases, conventional cross-selling and organic growth — will not readily fix the problem,” he said.

(Reporting by Kenneth Grierson, editing by Will Waterman)

Filed Under: International News Tagged With: , , , , , , , , , , , , , , , , ,

Retail banks making less from customers -study

July 20, 2010 By Leave a Comment

July 19 (Reuters) – Retail banks are making less profit on average from customers since the financial crisis as price-sensitive consumers shop around and become more demanding, according to a report released on Monday.

The study by consultancy Accenture found that nearly half of top global retail banks had seen the average profit from customers fall between 5 and 15 percent. A further 11 percent said they had seen bigger declines.

Of the 46 executives interviewed for the study, more than half said customer loyalty had decreased. Most expected the lack of customer loyalty to continue in the long term.

“Consumers (are) more sceptical of their bank brands, more price conscious, and more willing to move away from institutions that provide poor service,” said co-author Noel Gordon, global managing director of Accenture’s banking industry practice.

“For the banks, traditional profit-recovery strategies — rate and fee increases, conventional cross-selling and organic growth — will not readily fix the problem,” he said. (Reporting by Kenneth Grierson, editing by Will Waterman)

Filed Under: International News Tagged With: , , , , , , , , , , , , , , , , , ,

UPDATE 1-Pork supplier Cranswick Q1 sales up

July 14, 2010 By Leave a Comment

(Reuters) – British pork supplier Cranswick Plc (CWK.L) said on Tuesday first-quarter sales rose 19 percent as most of its product categories delivered strong growth reflecting higher volumes.

The company, which supplies fresh pork and gourmet sausages to Britain’s food retailing and manufacturing sectors, said it started the current financial year in line with its expectations.

“Whilst there was a reduction in sales of continental products, there were substantial gains in fresh pork, bacon and sandwiches and continued growth in cooked meats and sausages,” the company said in a statement.

For the three months ended June 30, total sales came in at 198 million pounds ($297.5 million), excluding revenue from the pet business, which was sold in April 2009.

The increase in sales reflects organic growth of 6 percent, and 13 percent from CCF Norfolk which it acquired in June 2009, Cranswick said.

The company’s net debt at end-June stood at 54 million pounds, which was lower than the year-end levels and down 16 percent from a year ago.

Cranswick shares closed at 860 pence on Monday on the London Stock Exchange. ($1=.6655 Pound) (Reporting by Tresa Sherin Morera in Bangalore; Editing by Roshni Menon)

Filed Under: International News Tagged With: , , , , , , , , , , , , , , , , , , ,

REFILE-Munich Re builds on Asia insurance expansion plans

June 25, 2010 By Leave a Comment

June 24 (Reuters) – German reinsurer Munich Re (MUVGn.DE) has embarked on its plans to expand in primary insurance in Asia by providing the reinsurance for a new direct online insurance facility launched in Singapore on Thursday.

Munich Re, which helps insurance companies pay for major losses, has teamed up with global insurance investor and services provider, Whittington Group, to launch DirectAsia.com, which will offer motor, travel, home and personal accident insurance through the website.

The world’s biggest reinsurer said it was seeking expansion in primary insurance in Asia, mainly through joint ventures and organic growth. [IDn:TOE65LO2K]

“The introduction of direct insurance is long overdue in most Asian countries,” said Anthony Hobrow, group chief executive of Whittington Group.

Whittington Group said virtually all personal lines insurance in Asia is sold through agents – who take commissions ranging from 10 percent to 50 percent.

“We have already seen the success of the direct business model in many other markets around the world, including Japan and South Korea,” he said.

Alexander Lay, head of casualty underwriting at Munich Re Singapore, said the move highlights the reinsurer’s position as a high value solution provider in Southeast Asia.

“Our reinsurance agreement gives DirectAsia.com access to our international network, consulting expertise and extensive motor insurance know-how,” he said.

This is not the first time Munich Re has provided reinsurance support for a primary insurance venture. The German reinsurer has a long-standing contract with Admiral Group to provide part of its reinsurance for its Elephant car insurance operation in the United States.

Munich Re’s chief executive officer Nikolaus von Bomhard told Reuters on Tuesday it expects to generate 15 percent of its business from Asia in the near future, up from 11 percent now.

He said the German reinsurer is looking for partnerships in China and India to start life or non life insurance businesses.

DirectAsia.com will be licensed and regulated by the Monetary Authority of Singapore.

(Additional reporting by Samuel Shen and Jane Lee)

Filed Under: International News Tagged With: , , , , , , , , , , , , , , , , , , ,

Australia’s Valemus to expand, IPO looms

June 17, 2010 By Leave a Comment

(Reuters) – The Australian unit of German construction group Bilfinger Berger (GBFG.DE) said on Wednesday it expected to double the size of its services business in three years through bolt-on acquisitions and organic growth.

The company, recently renamed Valemus ahead of a $1 billion-plus stock market listing next month, said it had no immediate plans to expand offshore and growth at its larger construction unit would be more steady in coming years.

“In the next three to four years we don’t see the need to go overseas. We see the growth opportunities in Australia as significant enough,” Valemus chief executive Peter Brecht said at the Reuters Global Real Estate and Infrastructure Summit.

Brecht was speaking ahead of a roadshow in Asia, Europe and the United States to market plans for an up to $1.1 billion float next month. He said investor interest in the float was high but there were some concerns about a predicted slowdown in Australian mining infrastructure spending.

Valemus, which translates from Latin to mean “we are strong”, earlier this month announced plans to push ahead with the country’s largest IPO in 8 months despite volatile markets which drove down valuations for the float to the lower levels of earlier expectations.

Brecht flies to Hong Kong on Wednesday to meet with investors to pitch the construction, engineering and services group which is being priced at 10.5 to 12 times 2010 earnings, lower than larger rival Leighton Holdings

Speaking in Sydney at the Reuters Summit, he said there was some concern from investors about a recent BIS Shrapnel report which predicted a 3 percent fall in mining and heavy industry construction in 2011.

However, he said this was not the indication Valemus was seeing from its own pipeline of work. The company has a forward order book of A$5.7 billion of work in hand at March 31, 2010.

“We have more work in hand for the 2011 year now than we had this time last year for the 2010 number so that is an indicator to us we will still have some growth in the business for 2011,” he said.

Valemus, named after an internal competition which drew over 1,200 submissions, has a 4 percent share of an estimated A$120 billion in Australian construction and engineering work up for grabs each year.

Brecht, a more than 22-year veteran with Valemus, would not say how much the company wanted to lift its market share to but said an infrastructure backlog, population demand and pressure on resources infrastructure would drive demand.

Valemus’ services business Conneq was expected to double in size of the next two or three years, he said, both through organic growth and strategic bolt-on acquisitions in mining, power and oil and gas.

The Valemus chief, who swims laps near the company office each day and loves rugby, boating and golf, said growth at its larger construction unit would be “steadier” but the company was underweight in the resource-rich state of Western Australia.

Valemus is hoping for a high level of interest from investors in Asia, Europe and the United States over the next week. He said there was no plan to attract large cornerstone investors.

Brecht said the company’s strategy would not change after the IPO but it would have the ability to respond faster to acquisition opportunities without needing clearance from parent Bilfinger which will no longer own a stake in the company after the float.

Filed Under: International News Tagged With: , , , , , , , , , , , , , , , , , , ,

UPDATE 1-StanChart seeking organic growth in S.Korea-exec

June 11, 2010 By Leave a Comment

SEOUL, June 10 (Reuters) – The head of Standard Chartered’s (STAN.L) South Korean unit said on Thursday the Asia-focused bank was seeking organic growth in the country, ruling out interest in acquiring Korea Exchange Bank (004940.KS).

“Our strategy in Korea is an organic strategy,” SC First Bank Chief Executive Richard Hill told reporters on the sidelines of a bank ceremony.

“We’ve invested now $5 billion of capital in Korea … so we’re going to continue to aggressively expand the business we’ve invested in already. It’s a core market for us,” Hill said, when asked by Reuters about possible interest in KEB.

Britain’s Standard Chartered Bank (2888.HK), which derives more than four-fifths of its profit from Asia, was the first European bank to set up a branch in South Korea and later expanded its presence with the acquisition of Korea First Bank in 2005. South Korea is now its second-biggest market.

Jaspal Bindra, Group Executive Director and Asia CEO for Standard Chartered, earlier told Reuters the bank would be disciplined about any acquisition.

“In our footprint we look at everything that is relevant in the banking space for us, but we are also very disciplined about any acquisition because it has to have both a financial and a strategic fit,” Bindra said on Monday in Vietnam.

“So far we have stayed with that principle, it’s worked well for us, so we’ll have to sort of apply this.”

Asked if there were banking M&A targets in his sights, he said: “Not so much in this region because we are pretty much in every market in Asia.”

He mentioned South Africa and Saudi Arabia as places they might look at.

“In Korea we are already quite big. We have 400 branches in Korea, we are one of the largest foreign banks in Korea. So Korea is not a small place for us,” he said.

U.S. equity fund Lone Star [LS.UL] has put up for sale its 51 percent stake in KEB, South Korea’s sixth-biggest lender by assets, but has seen slow progress in drumming up interest for the stake, worth 4.3 trillion won ($3.45 billion) at market price.

Australia and New Zealand Banking Group (ANZ.AX) and private equity house MBK Partners have shown interest, but South Korean banking groups remain inactive, while sources said ANZ was shifting its M&A focus to another target in Indonesia. [ID:nTOE658058]

HSBC (HSBA.L)(0005.HK), which had been speculated as another possible contender for KEB, has also ruled out its interest. [ID:nTOE63Q06A] ($1=1247.3 Won) (Reporting by Rhee So-eui and John Ruwitch; Editing by Jacqueline Wong)

Filed Under: International News Tagged With: , , , , , , , , , , , , , , , , , , ,

StanChart seeking organic growth in S.Korea – exec

June 11, 2010 By Leave a Comment

June 10 (Reuters) – The head of Standard Chartered’s (STAN.L) South Korean unit said the Asia-focused bank was seeking organic growth in the country, ruling out interest in acquiring Korea Exchange Bank (004940.KS).

“Our strategy in Korea is an organic strategy,” SC First Bank Chief Executive Richard Hill told reporters on the sidelines of a bank ceremony.

“We’ve invested now $5 billion of capital in Korea … so we’re going to continue to aggressively expand the business we’ve invested in already. It’s a core market for us,” Hill said, when asked by Reuters about possible interest in KEB.

Britain’s Standard Chartered (2888.HK), which derives more than four-fifths of its profit from Asia, was the first European bank to set up a branch in Korea and later expanded its presence with the acquisition of Korea First Bank in 2005. South Korea is now its second-biggest market.

U.S. equity fund Lone Star [LS.UL] has put up for sale its 51 percent stake in KEB, South Korea’s sixth-biggest lender by assets, but has seen slow progress in drumming up interest for the stake, worth 4.3 trillion won ($3.45 billion) at market price.

Australia and New Zealand Banking Group (ANZ.AX) and private equity house MBK Partners have shown interest, but South Korean banking groups remain inactive, while sources said ANZ was shifting its M&A focus to another target in Indonesia. [ID:nTOE658058]

HSBC (HSBA.L)(0005.HK), another possible contender for KEB, has also ruled out its interest. [ID:nTOE63Q06A] ($1=1247.3 Won) (Reporting by Rhee So-eui; Editing by Chris Lewis)

Filed Under: International News Tagged With: , , , , , , , , , , , , , , , , , , ,

Wyndham Hotel Group to Acquire Tryp Hotel Brand From Sol Melia

June 8, 2010 By Leave a Comment

PARSIPPANY, NJ, Jun 07 (MARKET WIRE) —
Wyndham Worldwide (NYSE: WYN) today announced that its Wyndham Hotel
Group business unit has agreed to acquire the Tryp(R) hotel brand from
Sol Melia Hotels & Resorts.

In addition, Wyndham will enter into a license agreement with the current
91 Tryp hotels located throughout Europe and South America that will
continue to be owned, operated, managed or licensed by Sol Melia. Wyndham
Hotel Group and Sol Melia will form a strategic alliance to work together
to develop the Tryp brand globally and market the hotels cooperatively
through their central reservations systems and loyalty programs.

The brand, expected to be renamed Tryp by Wyndham(R), is a
select-service, midmarket brand representing approximately 13,000 rooms
and caters to business and leisure travelers in cosmopolitan cities
including Madrid, Barcelona, Paris, Lisbon, Frankfurt, Buenos Aires, Sao
Paulo and Montevideo.

The acquisition price is approximately $43 million (USD), subject to
adjustments. The all-cash transaction is anticipated to close by the end
of the second quarter, subject to satisfaction of customary closing
conditions. Sol Melia will continue to operate hotels, resorts and
vacation clubs under its seven other owned brands.

“This acquisition reflects our strategy to invest in our fee-for-service
businesses and supplement organic growth with complementary brands,” said
Stephen P. Holmes, chairman and chief executive officer of Wyndham
Worldwide. “The addition of more than 90 high-performing hotels in key
international cities enhances and accelerates the recent development
momentum of the Wyndham Hotel Group. The transaction significantly
increases our international platform, enhancing our growth opportunities,
especially in Europe and Latin America.”

The Tryp by Wyndham brand would join Wyndham Hotel Group and its 11 other
hotel brands, which encompass nearly 7,100 hotels and 593,300 rooms in 65
countries.

“We look forward to adding the Tryp brand to our strong global portfolio
and continuing our working relationship with Sol Melia, a world-renowned
company,” said Wyndham Hotel Group president and chief executive officer,
Eric Danziger. “Sol Melia’s leaders built a family enterprise into a
successful and innovative global hotel company, providing an outstanding
collection of products and services for more than 50 years. We intend to
continue expanding the Tryp brand by utilizing our global development
team to tap the significant growth opportunities across Europe and the
Americas.”

“We selected to work with Wyndham Hotel Group because of the company’s
reputation as a global brand-builder, which will benefit the future of
the Tryp brand,” said Gabriel Escarrer Jaume, vice chairman and chief
executive officer of Sol Melia. “We are proud to have nurtured this
successful brand for the last 10 years. Now, this alliance will help Tryp
become a truly global hotel brand by creating long-term synergies between
our companies to boost Tryp Hotels to the next level.”

Wyndham Worldwide retained Kirkland & Ellis LLP and DLA Piper LLP (US)
for corporate legal services related to this transaction.

About Wyndham Hotel Group

Wyndham Hotel Group encompasses nearly 7,100 hotels and 593,300 rooms in
65 countries under the hotel brands: Wyndham Hotels and Resorts(R),
Wingate(R) by Wyndham, Hawthorn Suites(R) by Wyndham, Ramada(R), Days
Inn(R), Super 8(R), Baymont Inn & Suites(R), Microtel Inns & Suites(R),
Howard Johnson(R), Travelodge(R) and Knights Inn(R).

All hotels are independently owned and operated excluding certain Wyndham
and international Ramada hotels which are managed by an affiliate or
through a joint venture partner. Wyndham Hotel Group is based in
Parsippany, N.J. Additional information is available at
www.wyndhamworldwide.com.

About Sol Melia

Sol Melia was founded in 1956 in Palma de Mallorca, Spain and is one of
the world’s largest resort hotel chains, as well as Spain’s leading hotel
chain in both the business and leisure markets. It currently provides
more than 300 hotels in 26 countries on 4 continents under the brands:
Gran Melia, Melia, ME by Melia, Innside by Melia, Tryp, Sol, Paradisus
and Sol Melia Vacation Club.

Sol Melia is the only travel company included in the exclusive
“FTSE4GoodIbex” Spanish stock market index and is a signatory of the
United Nations Global Compact. In 2008 the company approved its Global
Sustainability Policy and in 2009 it was named the first “Biosphere Hotel
Company” by the Responsible Tourism Institute, supported by UNESCO. That
same year the company was also awarded the Prince Felipe Award for
Tourism Excellence for the second time.

The company currently employs more than 33,000 people worldwide with
staff from over 90 different countries. The company respects equal rights
and balance in its contracting of male and female staff and 10% of its
workforce is made up of immigrants. For more information, visit
www.solmelia.com.

About Wyndham Worldwide

As one of the world’s largest hospitality companies, Wyndham Worldwide
offers individual consumers and business-to-business customers a broad
suite of hospitality products and services across various accommodation
alternatives and price ranges through its premier portfolio of
world-renowned brands. Wyndham Hotel Group encompasses nearly 7,100
franchised hotels and approximately 593,300 hotel rooms worldwide.
Wyndham Exchange & Rentals offers leisure travelers, including its 3.8
million members, access to over 65,000 vacation properties located in
approximately 100 countries. Wyndham Vacation Ownership develops, markets
and sells vacation ownership interests and provides consumer financing to
owners through its network of over 155 vacation ownership resorts serving
over 820,000 owners throughout North America, the Caribbean and the South
Pacific. Wyndham Worldwide, headquartered in Parsippany, N.J., employs
approximately 25,000 employees globally.

For more information about Wyndham Worldwide, please visit the Company’s
web site at www.wyndhamworldwide.com.

Forward-Looking Statements

This press release contains “forward-looking statements” within the
meaning of Section 21E of the Securities Exchange Act of 1934, as
amended, conveying management’s expectations for the future, which are
based on plans, estimates and projections at the time the Company makes
the statements. Forward-looking statements involve known and unknown
risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the Company to be materially
different from any future results, performance or achievements expressed
or implied by such forward-looking statements. The forward-looking
statements contained in this press release include statements related to
the closing of the transaction discussed in this release and the
performance of the acquired business.

You are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date of this press release.
Factors that could cause actual results to differ materially from those
in the forward-looking statements include general economic conditions,
the economic environment for the hospitality industry, the impact of war
and terrorist activity, operating risks associated with the hotel
business, risks associated with acquisitions, especially international
transactions, as well as those described in the Company’s Annual Report
on Form 10-K, filed with the SEC on February 19, 2010 and the Company’s
Quarterly Report on Form 10-Q, filed with the SEC on April 30, 2010, in
each case including under such headings as “Risk Factors”, and in other
filings and furnishings made by the Company with the SEC from time to
time. Except for the Company’s ongoing obligations to disclose material
information under the federal securities laws, it undertakes no
obligation to release publicly any revisions to any forward-looking
statements, to report events or to report the occurrence of unanticipated
events.

Media Contact:
Evy Apostolatos
Director, Media Relations
Wyndham Hotel Group
22 Sylvan Way
Parsippany NJ 07054
+1 (973) 753-6590
Evy.Apostolatos@wyndhamworldwide.com

Investor Contact:
Margo C. Happer
Senior Vice President, Investor Relations
Wyndham Worldwide Corporation
(973) 753-6472
Margo.Happer@wyndhamworldwide.com

Copyright 2010, Market Wire, All rights reserved.

Filed Under: International News Tagged With: , , , , , , , , , , , , , , , , , , ,

A.M. Best Affirms Ratings of Citi Assurance Services Group`s Members

June 5, 2010 By Leave a Comment

OLDWICK, N.J.–(Business Wire)–
A.M. Best Co. has affirmed the financial strength rating (FSR) of A (Excellent)
and issuer credit ratings (ICR) of “a” of American Health and Life Insurance
Company (AHL) and Triton Insurance Company (Triton). Additionally, A.M. Best has
affirmed the FSR of A- (Excellent) and ICR of “a-” of Sears Life Insurance
Company (Sears Life). The outlook for all ratings is stable. These companies are
members of Citi Assurance Services Group (CAS), which is ultimately owned by
Citigroup Inc. (Delaware) (NYSE: C). All companies are domiciled in Fort Worth,
TX, unless otherwise specified.

The ratings of AHL reflect its strong risk-adjusted capitalization, consistently
positive statutory operating results and formidable market position in the
credit insurance business. The ratings also acknowledge the competitive
advantage derived from the sale of its core credit life and credit disability
products through its immediate parent, CitiFinancial Credit Company (CCC), one
of the leading consumer finance institutions with a network of branch offices
throughout the United States and Canada.

Partially offsetting these positive factors is the risk of AHL’s narrow business
profile, which is primarily focused on the sale of credit insurance products,
and its exposure to swings in the financial products marketplace. A.M. Best
notes that AHL’s top line premium growth has declined due to a reduction of loan
volume resulting from changes in credit criteria and lower new loan originations
from consumer finance business. The company`s loan volume is expected to pick up
in 2011 and 2012 after another challenging year in 2010. Furthermore, AHL’s
organic growth of capital and surplus funds has been hampered by the dividend
requirements of Citigroup Inc. and a coinsurance transaction with the National
Benefit Life Insurance Company.

Triton`s ratings recognize its historically strong operating performance,
superior risk-adjusted capitalization and the business opportunities it derives
from being a subsidiary of CCC. These positive factors are reflective of
management`s expertise in consumer finance-oriented products and Triton`s
conservative operating leverage.

Partially offsetting these positive rating factors is the anticipated further
decline in Triton`s premium volume in 2010 (attributable to decreases in loan
volume at CCC) and weak unemployment levels, which will likely continue to
pressure underwriting and overall operating profitability.

The ratings of Sears Life acknowledge its strong risk-adjusted capitalization
and continuing ownership by Citigroup Inc. These factors are offset by Sears
Life`s non-core position within CAS and its future declining trends in
life/health premium activities and earnings performance.

For Best`s Credit Ratings, an overview of the rating process and rating
methodologies, please visit www.ambest.com/ratings.

The principal methodologies used in determining these ratings, including any
additional methodologies and factors that may have been considered, can be found
at www.ambest.com/ratings/methodology.

Founded in 1899, A.M. Best Company is a global full-service credit rating
organization dedicated to serving the financial and health care service
industries, including insurance companies, banks, hospitals and health care
system providers. For more information, visit www.ambest.com.

A.M. Best Co.
Analysts
Steven Crotteau-L/H, 908-439-2200, ext. 5409
steven.crotteau@ambest.com
or
W. Dolson Smith, CFA-P/C, 908-439-2200, ext. 5379
w.dolson.smith@ambest.com
or
Public Relations
Rachelle Morrow, 908-439-2200, ext. 5378
rachelle.morrow@ambest.com
or
Jim Peavy, 908-439-2200, ext. 5644
james.peavy@ambest.com

Copyright Business Wire 2010

Filed Under: International News Tagged With: , , , , , , , , , , , , , , , , , , ,

UPDATE 2-Intermediate Capital swings to profit, mulls buys

June 3, 2010 By Leave a Comment

LONDON, June 2 (Reuters) – Buyout lender Intermediate Capital Group (ICP.L) returned to a full-year profit on capital gains and lower provisions at its investment arm and said it expects to make further progress in the current year.

The mezzanine finance specialist’s new chief executive said it will reach its ambitious target to double assets under management both through acquisitions and organic growth, adding it will snap up teams, portfolios or entire businesses if the right opportunity is available.

Mezzanine lending, common in takeovers or the expansion of existing companies, is a hybrid of debt and equity financing and is generally subordinated to debt from senior lenders such as banks and venture capital companies. It is often easier to obtain than bank financing.

“We see an opportunity to take portfolio of loans as banks realise they are too highly geared, and that there are further losses that they have to absorb,” Chief Executive Christophe Evain told Reuters.

ICG posted a full-year pretax profit of 106 million pounds compared to a loss of 67 million in 2009 and ahead of market expectations.

ICG, which lends directly to private equity firms and also invests in buyout debt on behalf of external clients, said profit before tax at its fund management company rose 23 percent to 38 million pounds.

“We feel the momentum seen in the portfolio in 2009/10 should be maintained in 2010/11 and we feel ICG has an attractive exit pipeline…and (it) has turned the corner,” said Bill Barnard an analyst at Evolution Securities.

ENCOURAGING SIGNS

ICG sank to a loss in the year to March 2009 after the banking crisis and subsequent recession triggered a surge in bad debts.

The group is now refocusing on its asset management business because higher funding costs in the wake of the banking crisis have made it less attractive to increase the volume of loans held on the company’s own balance sheet.

The company said on Wednesday there are “encouraging signs of attractive investments” in the refinancing of existing buyouts and that the pipeline of transactions in Asia Pacific and North America is growing.

“The U.S. is similar to Europe, but players in this market have been more pragmatic, they’ve addressed the issues faster, they’ve restructured their deals faster and the market is picking up faster,” he said.

Third party funds under management totalled at 7.3 billion pounds against 8.5 billion in 2009 and the company said its dividend would remain flat 17 pence per share for the year.

Shares in ICG were down 2.2 percent at 264-1/2 pence by 1012 GMT. (Reporting by Lorraine Turner; Editing by Louise Heavens)

Filed Under: International News Tagged With: , , , , , , , , , , , , , , , , , , ,

China Networks Completes Restructuring

April 16, 2010 By Leave a Comment

BEIJING, April 14, 2010 (GLOBE NEWSWIRE) — China Networks International
Holdings Ltd. (“China Networks” or the “Company”) (Pink Sheets:CNWHF), a
television advertising operator based in China, announced today the completion
of a $25.5 million debt restructuring. China Networks offers domestic and
international advertisers access to viewers and stations across its member
network throughout China.

In connection with the restructuring transaction, the holders of an aggregate of
$25.5 million in senior secured debentures of China Networks Media, Ltd., the
Company’s wholly-owned subsidiary, agreed to cancel the debentures in exchange
for 23 million common shares and 16 million preferred shares of China Networks.
Upon completion of restructuring, the outstanding capital of the Company will
consist of 41,019,993 common shares, 16,000,000 preferred shares and a total
debt of $11 million.

“It has been a pleasure working with our Kunming joint venture partners and the
respective local branches of the Chinese State Administration for Radio, Film
and Television,” says Kerry Propper, Board of Directors at China Networks. “The
execution of the restructuring marks a historical transaction for China Networks
and the overall media and television advertising industry in China. We completed
an ambitious corporate and debt restructuring plan so that we may now focus the
Company’s efforts on developing our business offerings. Through the series of
negotiations, we successfully secured a long-term partnership with Kunming SARFT
and are excited about the future of the business. Going forward, we will offer a
platform to our domestic and international advertising clients and enjoy high
profitability margins and strong organic growth on this and other future
television network collaborations.”

Chardan Capital Markets served as sole adviser on the restructuring.

About China Networks

China Networks International Holdings, Ltd., is a media advertising company
focusing on providing international and domestic advertising to its exclusive
networks in tier two and tier three cities in China., Currently the Company owns
and operates a 50% interest in the Kunming Taishi Information Cartoon Co., Ltd.
(Kunming) and Shanxi Yellow River & Advertising Networks Cartoon Technology Co.,
Ltd (Yellow River) Joint Ventures. Combined, Kunming and Yellow River represent
coverage of 7 television channels and 1 radio station covering 36 million
people. China Networks along with its joint venture partners seeks to add more
television stations to its advertising network. For more information about China
Networks, visit www.chinanetworks.com.

The China Networks International Holdings Ltd. logo is available at

http://www.globenewswire.com/newsroom/prs/?pkgid=7329

Safe Harbor Statement

This press release may include certain statements that are not descriptions of
historical facts, but are forward-looking statements. Such statements include,
among others, those concerning our assumptions, expectations, predictions,
intentions or beliefs about future events. Forward-looking statements can be
identified by the use of forward-looking terminology such as “will,” “believes,”
“expects” or similar expressions. Such information is based upon expectations of
our management that were reasonable when made but may prove to be incorrect. All
of such assumptions are inherently subject to uncertainties and contingencies
beyond our control and based upon premises with respect to future business
decisions, which are subject to change. We do not undertake to update the
forward-looking statements contained in this press release. For a description of
the risks and uncertainties that may cause actual results to differ from the
forward-looking statements contained in this press release, see our most recent
Annual Report on Form 10-K filed with the Securities and Exchange Commission
(“SEC”), and our subsequent SEC filings. Copies of filings made with the SEC are
available through the SEC’s electronic data gathering analysis retrieval system
at http://www.sec.gov.

CONTACT: Icon Media Communications
Investor and Media Contact:
Debra Chen
+ 917-499-8129
debra@imc-ir.com

Filed Under: International News Tagged With: , , , , , , , , , , , , , , , , , , ,
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