TIDMZIN
RNS Number : 4502X
Zinc Media Group PLC
26 April 2023
26 April 2023
Zinc Media Group plc
("Zinc" or the "Group")
Results for the year ended 31 December 2022
and
Notice of Annual General Meeting
Zinc Media Group plc (AIM: ZIN), the award-winning television,
brand and audio production group, is pleased to announce its
audited results for the year ended 31 December 2022 ("FY22").
The Group is pleased to report excellent progress for FY22,
including the following highlights:
Financial highlights
-- Revenue and Adjusted EBITDA [1] ahead of market expectations
, with the Group profitable at Adjusted EBITDA level
-- Revenue increased 72% to GBP30.1m (FY21: GBP17.5m) and marks
the highest revenue the Group has generated in the last ten
years
-- Organic revenue growth of GBP6.8m or 39% year-on-year,
reflecting the investment in new businesses and contracts
-- H2 revenues increased 83% to GBP19.2m (H2 2021: GBP10.5m)
-- Approximately 80% of revenue was delivered from existing customers, up from 69% in FY21
-- Adjusted EBITDA of GBP0.1m, compared to a loss of GBP0.6m in FY21
-- Strong H2 2022 performance with Adjusted EBITDA of GBP0.7m
-- GBP3.6m of cash at 31 December 2022 and GBP4.6m as at 19(th) April 2023
-- Loss before tax of GBP3.3m (FY21: GBP2.6m) is largely driven
by acquisition costs related to The Edge acquisition in the year
and amortisation related to previous acquisitions
Operational highlights
-- The successful acquisition of The Edge in August 2022 has
brought a quality, high margin business with significant repeat
revenue
-- The Edge is performing ahead of acquisition expectations,
having achieved its best ever trading performance last year,
generating GBP13m of revenue and GBP1.3m of profit before tax (of
which GBP5.8m of revenue and GBP0.7m of profit before tax has been
included in the Group's consolidated results)
-- The acquisition of The Edge has added considerable scale to
the Group, with pro-forma revenues for the enlarged group of GBP37m
in FY22 2
-- The Group has been awarded "Production Company of the Year"
at the prestigious New York Festival Film and Television Awards
Delivering a number of significant programme successes during
the year
-- Highly acclaimed documentaries that led the news agenda and
got the nation talking include Putin vs The West, Tom Daley:
Illegal to be me and Afghanistan: Getting out for the BBC
-- Zinc's largest ever volume commission, Bargain Loving Brits for Channel 5
-- Programming with fresh talent and from new buyers such as
Unprecedented for Discovery+, Space Jump for Red Bull, Martin
Compston's Scottish Fling for BBC, Spooked Ireland for Really,
Naughty Tories for Channel 5 and Sunday Morning Live for the
BBC
Current trading and outlook
-- The Group is trading strongly with GBP26m of revenue already
booked and expected to be recognised in FY23 (7 February 2023:
GBP15m)
-- In addition the Group's pipeline remains strong with a
further GBP6m of revenue at a highly advanced stage
-- Together this provides the B oard with confiden ce in delivering FY23 market expectations
-- Integration of The Edge is progressing well: cross-divisional
business development opportunities have been identified and the
planned co-location with Zinc's other London businesses later this
year will enable cost savings and further synergies
Mark Browning, CEO of Zinc Media Group, commented:
"We are delighted to report a strong set of results for FY22:
exceeding market expectations and revenues at a 10-year high. This
is a great achievement and has been testament to the breadth and
depth of our creative output. Performance in FY23 is very
encouraging and there is a feeling of momentum and optimism around
the Group. Zinc has a considerable pipeline of business and has
already booked GBP26m of revenue to be recognised this year. As a
result, the Board is positive for the outlook of the business and
views the remainder of the year with confidence."
Copies of the annual report and accounts
The annual report and accounts is available on the company's
website at www.zincmedia.com and a hard copy will be posted to
those shareholders registered to receive one.
Notice of annual general meeting
Accompanying the annual report and accounts is notice of the
Group's 2023 annual general meeting (the "AGM"), which will take
place at 10.00am on 25 May 2023 at Singer Capital Markets' offices
at 1 Bartholomew Lane, London, EC2N 2AX.
This announcement contains inside information for the purposes
of the UK Market Abuse Regulation. The Directors of the Company
take responsibility for this announcement.
For further information, please contact:
Zinc Media Group plc +44 (0) 20 7878 2311
Mark Browning, CEO / Will Sawyer, CFO
www.zincmedia.com
Singer Capital Markets (Nominated Adviser and Broker) +44 (0) 20
7496 3000
James Moat / George Tzimas / Alex Emslie
IFC Advisory Ltd (Financial PR) +44 (0) 20 3934 6630
Graham Herring / Zach Cohen
About Zinc Media Group
Zinc Media Group plc is a premium television and content
creation group.
The award-winning and critically acclaimed television labels
comprise Brook Lapping, Red Sauce, Supercollider, Tern Television,
Rex and Atomic, along with Bumblebee Post Production, and produce
programmes across a wide range of factual genres for UK and
international broadcasters.
Zinc Communicate specialises in developing cross-platform
content for brands, businesses and rights holders.
The Edge Picture Company produces film content for brands and
corporates in the UK, Qatar and other international markets.
For further information on Zinc Media please visit
www.zincmedia.com .
Chairman's Statement
2022's results reflect a transformational year for the Group.
The Board is delighted to see revenue grew 72% overall to a
ten-year high, powered by excellent organic growth of 39% and a
strong Adjusted EBITDA performance of GBP0.7m during the second
half, plus the successful acquisition of The Edge Picture Company
("The Edge"). This follows huge amounts of hard work and is a much
improved performance on the prior year.
The strong growth delivered by the Company and the high level of
revenues delivered from repeat customers provides the Board with
confidence of sustained Adjusted EBITDA profitability. The Board is
pursuing a strategy built on strong organic growth, supplemented by
selective acquisitions, to deliver long term profitable growth. The
Group has continued to invest in talent and new business
opportunities that are resulting in numerous contracts and should
lead to growth and profitability in 2023 and beyond.
The acquisition of The Edge in August 2022 has been a strong
addition to the Group. It has delivered record financial results in
its fourth quarter, helping the Group to report strong H2
profitability. The Edge entered 2023 in a good position with record
pre-booked revenue. Cross-selling opportunities and integration
into the wider Group is progressing well and cost benefits will be
realised with the planned move of The Edge from its current
premises in Covent Garden into Zinc's London headquarters in H2
2023.
The Group continues to deliver world class television and brand
content. Putin vs The West grabbed the news headlines across the
world when it was first broadcast in early 2023. Afghanistan:
Getting Out gave the inside track on the chaotic withdrawal of
western forces from Afghanistan and Bowelbabe In Her Own Words
provided exclusive access to the final days of Dame Deborah James'
battle with bowel cancer. In addition, Zinc has produced hundreds
of hours of television for all the main UK and many international
broadcasters including Zinc's largest ever volume commission for
Bargain Loving Brits, and brand content produced for companies
including Red Bull, EasyJet and Lego alongside large
multi-nationals in the FTSE100, government departments and NGOs.
The Company continues to receive notable endorsements for its
quality of production and programming, most recently winning
"Production Company of the Year" at the New York Festival
Awards.
The Board would like to thank the management team, the employees
and freelancers for their professional and dedicated work, as well
as our shareholders for their support in what has been a year of
strong progress.
CEO's Review
The strategic priorities for 2022 were to deliver good organic
growth, supported by high quality acquisitions, with the ambition
to build a strong core business by the end of 2022 that would
deliver long term sustainable profitability. All these were
delivered in the year.
Revenue growth
The Group grew strongly in 2022 with total revenue up 72% on
FY21 to GBP30.1m. This growth was achieved as a result of
investments made in London Television and Zinc Communicate during
the previous two financial years and the acquisition of The Edge in
August 2022. Following the easing of Covid-19 restrictions in H1,
revenue growth in H2 was even stronger, increasing 83% year-on-year
to GBP19.2m, and delivering an H2 Adjusted EBITDA of GBP0.7m, in
part driven by the acquisition of The Edge in August, which has
performed ahead of our expectations.
Organic revenue growth powered Zinc's top line performance and
grew GBP6.8m or 39% in FY22, driven by a very strong performance
from the Group's new businesses which were up 97% (GBP4.2m) as well
as excellent growth from the Group's established businesses, which
grew 20% (GBP2.6m).
The Group comprises twelve businesses that operate in two areas:
television production (Tern TV, Brook Lapping, Red Sauce,
Supercollider, Rex, Bumblebee and Atomic TV) and content production
for brands and businesses (The Edge and the Zinc Communicate
businesses in Brand Entertainment, Audio, Corporate Film and
Publishing).
Four of these businesses, Tern TV, Brook Lapping, Zinc
Communicate Publishing and The Edge have been established for many
years. Seven are new businesses that have been launched in the last
three years as part of the Group's transformation plan and are
growing at an accelerated rate. These comprise the London TV labels
Red Sauce, Supercollider and Rex, alongside Zinc Communicate
businesses in branded entertainment, corporate film and podcasting,
and the post-production business Bumblebee. Together the new
businesses contributed GBP9m of revenue in FY22, almost doubling
year-on-year. A new Bristol based TV label, Atomic TV, was launched
in January 2023.
The Edge has helped add scale to the Group, as well as an
increasing proportion of revenue from repeat customers. Zinc's
pro-forma group revenue for FY22 was over GBP37m (on the basis of
The Edge having been acquired at the start of FY22).
Strong customer base built on high levels of repeat
customers
The Group has a solid and growing base of existing business with
79% of revenue in FY22 from repeat customers, up from 69% in the
prior year, delivering a high level of earnings predictability.
This is particularly pleasing when taking into account that the
Group has a large number of new businesses that are still
establishing their client base. The revenue delivered from the
repeat customer base within the Group's established businesses is
90% of their revenue.
Continued revenue diversification delivering a more robust
Group
The Group's revenue and customer diversification was enhanced
with the acquisition of The Edge in August 2022. The Edge is one of
the world's leading producers of corporate and brand films,
producing work of a consistently high quality for a stable base of
long-term returning clients. It achieved healthy gross margins of
around 50% and had its best ever year in 2022. It started 2023 with
record levels of pre-booked revenue.
The addition of The Edge creates a more balanced Group where
television now accounts for around 60% of Group revenue and Zinc
Communicate and The Edge representing the remaining 40%. This
revenue mix and diversified portfolio has created a strong platform
on which to build future growth and de-risks the Group's previous
dependency on high value but binary TV commissions.
Path to sustainable profitable growth
The Group is pleased to report a profit at Adjusted EBITDA level
for FY22 of GBP0.1m, including a profit of GBP0.7m in the second
half, and we will look to accelerate growth in profitability in the
coming years.
Five of the eight new businesses launched in the last three
years are in the investment and early growth phase, and we expect
them to start contributing positively to Adjusted EBITDA in FY23
and beyond. Similarly, the Group has added some strategic high
volume, lower margin TV revenue in FY22 that is supporting the
Group's expansion into new TV markets. We believe these contracts
will provide long-term benefits by bringing new capabilities to the
Group, establishing Zinc in new markets and driving profitability
in the future. These contracts include a seven-figure development
funding from a global streaming service for an access documentary,
securing the Group's first weekly live television series for the
BBC and the commission of a high-volume daytime commission for
Channel 5, which have provided a foothold in the previously
untapped global streaming, live television and daytime markets.
Shareholder engagement
The Group conducted many engagements with shareholders during
the year. Alongside regular trading updates, the CEO and CFO
presented to all shareholders and interested parties three times
during the year using the Investor Meets Company platform and
investors can follow the Group via the DirectorsTalk platform. In
addition, the Group held a capital markets day at the Zinc
headquarters in London. This provided the opportunity for investors
to meet the executive team and Chairman along with members of the
senior management team, and the CEO presented market insights and
showcased the creative work from around the Group. Following its
success, the Company intends to present another capital markets day
this year and further details will be announced via RNS in due
course. Investor Focus Communications (IFC) is the Group's investor
relations and financial PR advisor. News is regularly posted on the
Group's website and on the Group's social media feeds. Links to
these can be found at www.zincmedia.com .
Looking forward in FY23 with confidence
The Group entered 2023 with the highest amount of pre-booked
revenue since the new management team took over in 2019. As at 18
April 2023, revenue booked and expected to deliver and be
recognised in FY23 stands at GBP26m, with a further GBP6m on the
pipeline at a highly advanced stage. Last year GBP18m of revenue
was booked between May and December and recognised in FY22. Taken
together, these underpin the Board's confidence in comfortably
achieving market expectations for the year ahead.
Zinc's programmes have led the national conversation so far this
year and include Putin vs The West and Bowelbabe: In her Own Words
which received 5-star reviews with The Times calling the film "a
masterclass in how to make life and death meaningful". Channel 4
has announced a high profile commission titled Gender Wars which
will explore one of the most polarised issues of our time, the
meaning of sex and gender. BBC One has broadcast Dr Xand: Con or
Cure and also recently announced their first commission from Rex TV
called Get your Eurovision on!.
The size of the opportunity ahead is significant. H2 2022
results provide evidence that the Group can generate healthy
Adjusted EBITDA and cash as it scales. Growth will come organically
and from pursuing selected earnings accretive acquisitive
opportunities. We are optimistic that growth will accelerate in
2023 and beyond.
Programme highlights
2022 was packed with programme and editorial highlights.
Putin vs The West was produced in 2022 for the BBC and aired in
Q1 2023. This programme secured exclusive access to world leaders
including former UK Prime Ministers Theresa May, David Cameron and
Boris Johnson, along with former French President François Hollande
and current Ukrainian President Volodymyr Zelenskyy, in addition to
the Director of the CIA. This three-part series told the story of
how through the decades of clashes, the West has struggled to deal
with President Putin.
Bargain Loving Brits: the long running series was super-sized in
2022 with Channel 5 commissioning over 50 episodes of fun-loving
ex-pats in Spain setting up businesses, enjoying retirement and
always searching for a bargain on the Costa del Sol.
Tom Daley: Illegal to be me: As thousands of athletes prepared
to compete on the global stage at the 2022 Commonwealth Games in
Birmingham gold medallist and double world champion diver Tom Daley
exposed the brutality faced by gay athletes in many competing
countries where it remains illegal to be gay, including 56 member
states of the Commonwealth.
Space Jump: This special feature documentary for Red Bull was
released to mark the tenth anniversary of Felix Baumgartner's 2012
record-breaking sound barrier bursting, mega jump from space.
Baumgartner broke the speed of sound in freefall reaching a speed
of 843mph, and also broke all records for live streaming, a record
that still stands today.
Afghanistan: Getting Out was a two part documentary for the BBC
in partnership with numerous other global broadcasters telling the
twenty year story of the West's conflict with Afghanistan
culminating in the chaotic withdrawal of Western forces in
2021.
Martin Compston's Scottish Fling: Tern TV secured The Line of
Duty star to present this factual entertainment series for the BBC,
showcasing the spirit of Scotland through its people and
places.
Sunday Morning Live: Tern TV secured this live weekly programme
for BBC ONE in an open competitive tender, in a production
partnership with Green Inc Film and Television. Sunday Morning Live
is an ethical discussion programme picking up on the week's topical
news and events.
Productions made outside London ("MoL") are important for the
UK's Public Service Broadcasters ("PSBs") and Zinc is well placed
to address this need, with substantive long term production centres
in Manchester, Glasgow, Belfast and Aberdeen. At the beginning of
2023 the Group opened a new TV label in Bristol, a city world
renowned for producing specialist factual programmes including
natural history, travel and adventure and history. Over two thirds
of Zinc's production revenues in 2022 were MoL, driven by the
success of Red Sauce in Manchester and Tern TV in Scotland and
Northern Ireland.
Supercollider, Zinc Communicate and The Edge produced hundreds
of brand and corporate films in 2022 for many of the world's
largest and most recognisable brands including Red Bull, EasyJet
and Lego alongside multi-national FTSE100 organisations as well as
NGOs and government organisations.
There were dozens of other programmes produced by Zinc Media
Group in 2022, which can be seen on www.zincmedia.com . Zinc's
group of companies produces content watched by tens of millions of
people across the world every year, and its programmes have led the
news and the national conversation across the United Kingdom.
Market and outlook
In television the PSBs (comprising the BBC, ITV, Channel 4 and
Channel 5) represent the largest market for Zinc and the Group
produces for all these channels.
The total TV commissioning market in 2022 for UK producers still
remained below pre-Covid levels at GBP4.3bn (GBP4.7bn in 2019) but
the factual television spend in 2022 remained consistent at GBP1bn,
of which c. GBP850m was spent with independent production
companies, not owned by the main broadcasters or channels (Source:
Ofcom 2022). PSB's account for just over 50% of this commissioning
market and Channel 4 is the single largest commissioning channel
from the independent production sector. Zinc has made specific
investments in Tern TV and Rex TV to grow the number of programmes
it makes for Channel 4. Subscription Video on Demand (SVoD)
spending on UK factual programming by the likes of Netflix and
Disney+ has risen significantly, although the number of hours
commissioned remains far lower than the PSBs, and UK multi-channels
have also increased their spend from the independent production
sector.
Zinc is well placed to continue to grow from this large factual
commissioning market. Approximately GBP200m of the UK PSB spend on
television commissions is spent outside of London, which validates
Zinc's continued investment in Tern TV (Glasgow and Belfast), Red
Sauce TV (Manchester) and the launch in 2023 of the new Atomic TV
(Bristol).
While premium documentary programmes such as Putin vs The West
and Tom Daley: Illegal to be me have generated both recognition and
awards for Zinc, it is the factual entertainment market which
offers the greatest potential for accelerated growth. This genre
represents the largest proportion of PSB commissioning spend in
non-scripted television and Zinc has diversified into this market
in recent years with the launch of Red Sauce TV and Rex TV as well
as new investment in factual entertainment within Tern TV. While
this is the largest addressable factual market for Zinc, it is
dominated by a large number of returning series. This makes it
initially hard to penetrate but provides lucrative and long running
returning revenues once business is secured. The super-sized Red
Sauce commission from Channel 5 is testament to this, and Rex TV
has a growing pipeline in this market. Factual entertainment also
offers the opportunity for increased international distribution and
format sales.
In addition to broadcast television production, the Group's
commercial content production division Zinc Communicate continues
to grow at pace, with CAGR of 22% over the last three years. If
these high levels of organic growth can be sustained in the years
ahead, the Group will have developed a prominent position in this
large, and higher margin, market for corporate and brand films. The
addition of The Edge accelerates the Group's presence in this
market.
We are very encouraged by the high rate of new business wins in
recent months, including high profile television programmes, large
volume series and the new businesses gaining excellent traction in
the market:
-- The Group's newest TV labels, Red Sauce, Rex and
Supercollider, have booked GBP9m of revenue into FY23; Bristol
based Atomic TV was launched in January this year
-- The Edge has booked GBP8m that is expected to be recognised
in FY23, which is the highest amount of pre-booked revenue it has
had at this stage of a financial year
-- Red Sauce has won the Group's largest ever commission worth
GBP7.3m, to be recognised over FY23 and FY24, and is in production
for two new series which are yet to be announced
CFO's Report
Income Statement
======================== ====== ====== =======
Revenue 30.1 17.5 12.6
======================== ====== ====== =======
Gross Profit 10.2 6.7 3.5
======================== ====== ====== =======
Gross Margin 34.0% 38.5% (4.5%)
======================== ====== ====== =======
Loss before tax (3.3) (2.6) (0.7)
======================== ====== ====== =======
Adjusted EBITDA 0.1 (0.6) 0.7
======================== ====== ====== =======
Statement of financial
position
------------------------ ------ ------ -------
Cash 3.6 5.6 (2.0)
------------------------ ------ ------ -------
Long-term debt (3.5) (3.4) (0.1)
------------------------ ------ ------ -------
Net cash 0.1 2.2 (2.1)
------------------------ ------ ------ -------
Income statement
Revenue
The key drivers for the increase in revenue from GBP17.5m to
GBP30.1m are organic growth of GBP6.8m from the TV and Zinc
Communicate divisions and the acquisition of The Edge, which
contributed GBP5.8m of revenue since its acquisition. The organic
growth was driven by an increase of GBP5.6m, or 39%, year-on-year
from the TV business via its new labels and a GBP1.2m increase from
Zinc Communicate, a 40% increase year-on-year, which has grown its
brand and corporate film offering.
Revenue (GBPm)
Gross margin and operating expenses
The Group's gross margin decreased during the period from 38.5%
to 34.0% due to a strategic increase in the volume of lower margin
TV revenue that is supporting the Group's expansion into new TV
markets and accounted for GBP7m of revenue in FY22. Gross margins
excluding this lower margin TV revenue have risen to 40.5% from
38.5% in FY21. This was mainly driven by the acquisition of The
Edge which delivers higher margins.
Whilst Group gross margin decreased in FY22, it remains notably
ahead of the performance achieved in previous years, as
demonstrated in the graph below.
Group gross margins (%)
Adjusting items incurred during the year amounted to GBP1.3m
(FY21: GBP0.3m), which mainly comprised the costs relating to the
acquisition of The Edge which were GBP0.95m, in addition to
restructuring and share based payment costs of GBP0.3m (FY21:
GBP0.2m).
Operating expenses have risen by GBP4.0m to GBP13.1m, and whilst
this represents a 44% increase on the prior year, the rate of
growth has been significantly outpaced by the 72% increase in
revenue due to the Group's relatively high operating leverage. As a
result, operating costs as a percentage of revenue have fallen from
52% to 44%.
Finance costs, which mainly relate to interest on the Group's
long-term debt, have risen from GBP0.2m to GBP0.4m as the relevant
interest rate is based on the Bank of England base rate, and also
subject to a floor of RPI, both of which increased during the
year.
Earnings per share
Basic and diluted loss per share from continuing operations in
FY22 was 12.43p (FY21: loss per share of 15.80p). These measures
were calculated on the losses for the period from continuing
operations attributable to Zinc Media shareholders of GBP2.3m
(FY21: loss of GBP2.5m) divided by the weighted average number of
shares in issue during the period being 18,480,039 (FY21:
16,095,991 ).
Dividend
The Board has not recommended a dividend in respect of the year
ended 31 December 2022 (FY21: GBPnil).
Statement of Financial Position
Net assets have increased by GBP3.2m to GBP7.0m at the end of
December 2022, driven by the acquisition of The Edge which added
GBP1.9m of net assets at year end.
Assets
Cash balance at the end of December 2022 was GBP3.6m. This
represents a decrease of GBP2.0m during the year, as the cash
consideration paid for The Edge, outflows from operating
activities, capital expenditure, property leases and the servicing
of the long-term debt offset the net proceeds from the equity
fundraise in August 2022.
Trade and other receivables have increased by GBP6.7m to
GBP10.6m, driven by The Edge's receivables of GBP4.9m.
Equity and Liabilities
Total equity has increased from GBP3.7m to GBP7.0m as the issue
of new equity more than offset the loss in the year.
Total liabilities have increased by GBP5.3m due The Edge's
liabilities being consolidated into the Group and contingent
consideration payable as part of the acquisition. The Group had an
outstanding balance on long-term debt of GBP3.5m at year-end (FY21:
GBP3.4m). The Directors believe the Group has strong shareholder
support, evidenced by shareholders investing GBP5.0m in new equity
in the year. The long-term debt holders are also major shareholders
who own 42% of the Group's shares.
Cash Flows
The Group used cash of GBP4.6m in the year (FY21: GBP0.2m) in
its operations mainly due to an increase in working capital from a
high receivable position in the last year and as a result of The
Edge acquisition. The net movement in the year was a decrease in
cash of GBP2.0m (FY21: decrease of GBP1.2m) after financing
activity cash inflow of GBP3.9m (FY21: outflow of GBP0.6m) and cash
used in investing activities of GBP1.2m (FY21: GBP0.3m), driven
respectively by the GBP4.8m equity fundraise (net of costs) and
associated acquisition of The Edge which contributed a net cash
outflow of GBP0.3m (GBP1.2m consideration paid less GBP0.9m of cash
acquired).
Key Performance Indicators (KPIs)
In monitoring the performance of the business, the executive
management team uses the following KPIs:
-- Revenue growth, including revenue from repeat customers and new business pipeline strength
-- Profitability assessed by key measures including gross margins and Adjusted EBITDA
-- Cash generation and cash management
-- Performance and integration of acquisitions
These KPIs have been reported on within the Strategic
Report.
Consolidated income statement for the year ended 31 December
2022
12 months
ended 12 months ended
31 December 31 December
2022 2021
Notes GBP'000 GBP'000
------------------------------ ------ ------------ ----------------
Continuing operations
Revenue 4 30,083 17,491
Cost of sales 5 (19,880) (10,759)
------------------------------ ------ ------------ ----------------
Gross profit 10,203 6,732
Operating expenses 5 (13,083) (9,097)
Operating loss (2,880) (2,365)
------------------------------ ------ ------------ ----------------
Analysed as:
Adjusted EBITDA 75 (612)
Depreciation 5 (947) (782)
Amortisation 5 (715) (704)
Adjusting items 8 (1,293) (267)
Operating loss (2,880) (2,365)
------------------------------ ------ ------------ ----------------
Finance costs 9 (390) (241)
Finance income 9 1 -
------------------------------ ------ ------------ ----------------
Loss before tax (3,269) (2,606)
Taxation credit/(charge) 10 987 86
Loss for the period (2,282) (2,520)
Attributable to:
Equity holders (2,297) (2,544)
Non-controlling interest 15 24
Retained loss for the period (2,282) (2,520)
------------------------------ ------ ------------ ----------------
Earnings per share
Basic 11 (12.43)p (15.80)p
Diluted 11 (12.43)p (15.80)p
The loss for the period attributable to equity holders from
continuing operations is GBP2,297k ( 31 December 2021 :
GBP2,544k).
The accompanying principal accounting policies and notes form
part of these consolidated financial statements.
Consolidated statement of comprehensive income for the year
ended 31 December 2022
12 months 12 months
ended ended
31 December 31 December
2022 2021
GBP'000 GBP'000
------------------------------------------- ------------ ------------
Loss for the year and total comprehensive
expense for the period (2,282) (2,520)
Attributable to:
Equity holders (2,297) (2,544)
Non-controlling interest 15 24
(2,282) (2,520)
------------------------------------------- ------------ ------------
Consolidated statement of financial position as at 31 December
2022
2022 2021
Note GBP'000 GBP'000
------------------------------------- ----- -------- --------
Assets
Non-current
Goodwill and intangible assets 12 7,671 3,800
Property, plant and equipment 13 1,056 904
Right-of-use assets 18 1,084 1,159
9,811 5,863
------------------------------------- ----- -------- --------
Current assets
Inventories 14 73 226
Trade and other receivables 15 10,591 3,887
Cash and cash equivalents 16 3,632 5,608
14,296 9,721
------------------------------------- ----- -------- --------
Total assets 24,107 15,584
------------------------------------- ----- -------- --------
Equity
Called up share capital 24 27 20
Share premium account 24 9,546 4,785
Share based payment reserve 457 277
Merger reserve 24 566 27
Retained losses 24 (3,653) (1,386)
------------------------------------- ----- -------- --------
Total equity attributable to equity
holders of the parent 6,943 3,723
------------------------------------- ----- -------- --------
Non-controlling interests 16 24
------------------------------------- ----- -------- --------
Total equity 6,959 3,747
------------------------------------- ----- -------- --------
Liabilities
Non-current
Borrowings 19 3,490 -
Lease liabilities 18 352 735
Deferred tax 21 - 190
Provisions 22 242 250
Trade and other payables 17 2,476 -
6,560 1,175
------------------------------------- ----- -------- --------
Current
Trade and other payables 17 9,753 6,799
Current tax liabilities 160 4
Borrowings 19 - 3,428
Lease liabilities 18 675 431
10,588 10,662
-------- --------
Total liabilities 17,148 11,837
------------------------------------- ----- -------- --------
Total equity and liabilities 24,107 15,584
------------------------------------- ----- -------- --------
The consolidated financial statements were authorised for issue
and approved by the Board on 25 April 2023 and are signed on its
behalf by Will Sawyer.
The above consolidated statement of financial position should be
read in conjunction with the accompanying notes.
Company registration number: SC075133
Consolidated statement of cash flows for the year ended 31
December 2022
12 months 12 months
ended ended
31 December 31 December
2022 2021
Note GBP'000 GBP'000
---------------------------------------------- ----- ------------ ------------
Cash flows from operating activities
Loss for the year before tax from continuing
operations (3,269) (2,606)
(3,269) (2,606)
Adjustments for:
Depreciation 5 947 782
Amortisation and impairment of intangibles 5 715 704
Finance costs 9 390 241
Finance income 9 (1) -
Share based payment charge 7 180 122
Contingent consideration deemed remuneration 8 - -
Consideration paid in shares 30 131
Loss on disposal of assets 8 - 4
(1,008) (623)
Decrease/(increase) in inventories 191 (42)
(Increase)/decrease in trade and other
receivables (2,841) 392
(Decrease)/increase in trade and other
payables (975) 28
---------------------------------------------- ----- ------------ ------------
Cash used in operations (4,633) (245)
Finance income 1 -
Finance costs (57) (65)
Net cash flows used in operating activities (4,689) (310)
---------------------------------------------- ----- ------------ ------------
Investing activities
Payment of contingent consideration on - -
acquisition of subsidiary
Purchase of property, plant and equipment 13 (831) (273)
Purchase of intangible assets 12 (50) -
Acquisition of subsidiary net of cash
acquired 23 (324) -
Net cash flows used in investing activities (1,205) (273)
---------------------------------------------- ----- ------------ ------------
Financing activities
Issue of ordinary share capital (net of
issue costs) 24 4,767 -
Principal elements of lease payments 18 (555) (432)
Borrowings repaid 19 (265) (176)
Dividends paid to NCI (23)
Net cash flows generated from / (used
in) from financing activities 3,924 (608)
---------------------------------------------- ----- ------------ ------------
Net decrease in cash and cash equivalents (1,970) (1,191)
Translation differences (6) (6)
Cash and cash equivalents at beginning
of year/period 16 5,608 6,805
---------------------------------------------- ----- ------------ ------------
Cash and cash equivalents at year/period
end 16 3,632 5,608
---------------------------------------------- ----- ------------ ------------
Consolidated statement of changes in equity for the year ended
31 December 2022
Total
equity
attributable
Share to equity
based holders
Share Share payment Merger Retained of Non-controlling Total
capital premium reserve reserve earnings the parent interest equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1 January
2021 20 4,654 155 27 1,158 6,014 12 6,026
--------------------- --- -------- --------- -------- --------- -------------- ---------------- --------
Loss and total
comprehensive
expense for the
period - - - - (2,544) (2,544) 24 (2,520)
--------------------- --- -------- --------- -------- --------- -------------- ---------------- --------
Equity-settled
share-based
payments - - 122 - - 122 - 122
Consideration paid
in shares - 131 - - - 131 - 131
Dividends paid - - - - - - (12) (12)
Total transactions
with owners
of the Company - 131 122 - (2,544) (2,291) 12 (2,279)
--------------------- --- -------- --------- -------- --------- -------------- ---------------- --------
Balance at 31
December 2021 20 4,785 277 27 (1,386) 3,723 24 3,747
--------------------- --- -------- --------- -------- --------- -------------- ---------------- --------
Balance at 1 January
2022 20 4,785 277 27 (1,386) 3,723 24 3,747
--------------------- --- -------- --------- -------- --------- -------------- ---------------- --------
Loss and total
comprehensive
expense for the
period - - - - (2,297) (2,297) 15 (2,282)
--------------------- --- -------- --------- -------- --------- -------------- ---------------- --------
Equity-settled
share-based
payments - - 180 - - 180 - 180
Shares issued in
placing net
of expenses 6 4,761 - - - 4,767 - 4,767
Consideration paid
in shares 1 - - 539 - 540 - 540
Shares issued in
lieu of
fees/Directors
remuneration paid
in shares - - - - 30 30 - 30
Dividends paid - - - - - - (23) (23)
Total transactions
with owners
of the Company 7 4,761 180 539 (2,267) 3,220 (8) 3,212
--------------------- --- -------- --------- -------- --------- -------------- ---------------- --------
Balance at 31
December 2022 27 9,546 457 566 (3,653) 6,943 16 6,959
--------------------- --- -------- --------- -------- --------- -------------- ---------------- --------
Notes to the consolidated financial statements
1. GENERAL INFORMATION
Zinc Media Group plc and its subsidiaries (the Group) produce
high quality television and cross-platform content.
Zinc Media Group plc is the Group's ultimate parent and is a
public listed company incorporated in Scotland. The address of its
registered office is 4th Floor, Saltire Court, 20 Castle Terrace,
Edinburgh EH1 2EN. Its shares are traded on the AIM Market of the
London Stock Exchange plc (LSE:ZIN).
The financial statements are presented in Sterling (GBP),
rounded to the nearest thousand.
2. BASIS OF PREPARATION
The financial statements of the Group have been prepared in
accordance with UK-adopted-International Accounting Standards. The
financial statements have been prepared primarily under the
historical cost convention, with the exception of contingent
consideration measured at fair value. Areas where other bases are
applied are identified in the accounting policies below.
The Group's accounting policies have been applied consistently
throughout the Group to all the periods presented, unless otherwise
stated.
2.1) Going concern
The financial statements have been prepared on a going concern
basis, which assumes that the Group will be able to meet its
liabilities as they fall due for a period of at least 12 months
from the date of signing of the financial statements. The Group is
dependent for its working capital requirements on cash generated
from operations, cash holdings, long-term debt and from equity
markets.
The Directors believe the Group has sufficient cash resources.
As at 31 December 2022 the cash holdings of the Group were GBP3.6m
and net cash was GBP0.1m. The Group also has an overdraft facility
of GBP0.6m available.
The Directors believe the Group has strong shareholder support,
evidenced by shareholders investing GBP12.5m in new equity in
recent years and the long-term debt holders, who are also major
shareholders with 42% of the Group's shares, having agreed in 2022
to extend the repayment date of the Group's long-term debt from
December 2022 to December 2024.
Management have prepared forecasts and scenarios under which
cashflows may vary and believe there are sufficient mitigating
actions that can be employed to enable the Group to operate within
its current level of financing for a period of at least 12 months
from the date of signing of the financial statements.
There are several factors which could materially affect the
Group's cashflows, including the underlying performance of the
business and uncertainty regarding the timing of receipts from
customers. The Directors have prepared scenario plans. The main
variable is the run rate of new business. Whilst the sales pipeline
is healthy the timing of new sales is hard to predict, the
scenarios include revenues being 15% down on budget. The Directors
have reviewed management's forecasts and scenarios under which
cashflows may vary and remain confident that the Group will have
sufficient cash resources for a period of at least 12 months from
issuing the financial statements in these scenarios.
In light of the forecasts, the support provided by shareholders
and mitigating measures available to be used if needed, the
Directors believe that the going concern basis upon which the
financial statements have been prepared is reasonable.
2.2) Basis of consolidation
The consolidated financial statements comprise the financial
statements of the Group and its subsidiaries as at 31 December
2022. Control is achieved when the Group is exposed, or has rights,
to variable returns from its involvement with the investee and has
the ability to affect those returns through its power over the
investee. Generally, there is a presumption that a majority of
voting rights results in control. To support this presumption and
when the Group has less than a majority of the voting or similar
rights of an investee, the Group considers all relevant facts and
circumstances in assessing whether it has power over an
investee.
Consolidation of a subsidiary begins when the Group obtains
control over the subsidiary and ceases when the Group loses control
of the subsidiary. Assets, liabilities, income and expenses of a
subsidiary acquired or disposed of during the year are included in
the consolidated financial statements from the date the Group gains
control until the date the Group ceases to control the
subsidiary.
All intra-group assets and liabilities, equity, income, expenses
and cash flows relating to transactions between members of the
Group are eliminated in full on consolidation.
Non-controlling interests (NCI) represents the share of
non-wholly owned subsidiaries' net assets that are not directly
attributable to the shareholders of the Group.
2.3) Adoption of new and revised standards
No new standards were adopted in 2022. A number of other new
pronouncements are effective from 1 January 2023 the principal ones
are listed below:
-- Amendments to IAS 1 Presentation of Financial Statements and IFRS Practice Statement 2:
Disclosure of Accounting policies (Effective 1 January 2023)
-- Amendments to IAS 12 Deferred Tax related to Assets and Liabilities arising from a Single
Transaction (Effective 1 January 2023)
-- Amendments to IAS 8 Accounting policies, Changes in
Accounting Estimates and Errors: Definition
of Accounting Estimates (Effective 1 January 2023)
3) ACCOUNTING POLICIES
3.1) Revenue
The Group recognises revenue to depict the transfer of promised
goods or services to customers at an amount that reflects the
consideration to which the entity expects to be entitled in
exchange for those goods or services. Specifically, the Group
follow these steps:
1. Identify the contract with the customer
2. Identify the performance obligations in the contract
3. Determine the transaction price
4. Allocate the transaction price to the performance obligations in the contract
5. Recognise revenue when (or as) the entity satisfies a performance obligation
Revenue is measured at the fair value of the consideration
received or receivable and represents amounts receivable for
services provided in the normal course of business, net of
discounts and sales related taxes.
Revenue is recognised when the amount of revenue can be measured
reliably, it is probable that the economic benefits associated with
the transaction will flow to the entity, the costs incurred or to
be incurred can be measured reliably, and when the criteria for
each of the Group's different activities has been met.
Where productions are in progress at the year end and where the
revenue amounts invoiced exceed the value of work done the excess
is shown as contract liabilities; where the revenue recognised
exceeds revenue invoiced the amounts are classified as contract
assets. The contract asset is transferred to receivables when the
entitlement to payment becomes unconditional. Where it is
anticipated that a production will make a loss, the anticipated
loss is provided for in full.
The accounting policies specific to the Group's key operating
revenue categories are outlined below:
TV - production and content production revenue
Production revenue from contracts with broadcasters comprises
work carried out to produce and deliver television programmes and
broadcaster licence fees. These are combined performance
obligations because the production and licence are indistinct, and
the licence is not the primary or dominant component of the
combined performance obligation. The Group considers the combined
performance obligation to be satisfied over time as it does not
create an asset with an alternative use at contract inception and
the Group has an enforceable right to payment for performance
completed to date.
The Group recognises revenue over time by measuring the progress
towards complete satisfaction of the performance obligation, in
line with transferring control of goods or services promised to a
customer. The Group transfers control of the programme over time,
and costs are incurred in line with performance completed. The
percentage of completion is calculated as the ratio of the contract
costs incurred up until the end of the period to the total
estimated programme cost.
TV - distribution revenue
Distribution revenue comprises sums receivable from the
exploitation of programmes in which the company owns rights and is
received as advances and royalties.
Advances are fixed sums receivable at the beginning of
exploitation that are not dependent on the sales performance of the
programme. They are recognised when all the following criteria have
been met:
i) an agreement has been executed by both parties; and
ii) the programme has been delivered; and
iii) the licence period has begun.
Royalty revenue is dependent on the sales performance of the
programme and is recognised when royalty amounts are confirmed.
Publishing
Advertising revenue is recognised on the date publications are
published which is when control transfers to the customer.
3.2) Property, plant and equipment
Property, plant and equipment are stated at cost net of
depreciation and any provision for impairment.
Depreciation is calculated to write down the cost less estimated
residual value of all property, plant and equipment by equal annual
instalments over their expected useful lives. The rates generally
applicable are:
Leasehold premises over the term of the lease
Office equipment 10%-20% on cost
Computer equipment 20%-33% on cost
Motor vehicles 25% on cost
Useful economic lives are reviewed annually. Depreciation is
charged on all additions to, or disposals of, depreciating assets
in the year of purchase or disposal. Any impairment in values is
charged to the income statement.
3.3) Intangible assets
Business combinations are accounted for by applying the
acquisition method. Goodwill represents the difference between the
cost of the acquisition and the fair value of the net identifiable
assets acquired. Identifiable intangibles are those which can be
sold separately, or which arise from legal rights regardless of
whether those rights are separable.
Goodwill is stated at cost less any accumulated impairment
losses. Goodwill is allocated to cash-generating units and is not
amortised but tested annually for impairment.
Goodwill arising on acquisitions is attributable to operational
synergies and earnings potential expected to be realised over the
longer term.
The intangible assets other than goodwill are in respect of the
customer relationships, brand and distribution catalogue acquired
in respect of the acquisition of The Edge and Tern Television
Productions and in each case, are amortised over the expected life
of the earnings associated with the asset acquired.
Brands, Customer relationships Over 7 - 10 years
Distribution catalogue Over 5 years
Software Over 2 years
Brands and customer relationships relate to the acquisition of
Tern Television Productions and The Edge. They are amortised over a
period of 7 and 10 years respectively and as at 31 December 2022
there was under 2 years remaining for Tern Television Productions
and under 10 years for The Edge.
The distribution catalogue intangible asset arose on the
acquisition of Tern Television Productions. It is amortised over 5
years and as at 31 December 2022 the remaining useful life was
nil.
The software relates to a finance system that is used across the
group and CRM system in Zinc Communicate.
3.4) Leased assets
For any new contracts the Group considers whether a contract is,
or contains, a lease. A lease is defined as 'a contract, or part of
a contract, that conveys the right to use an asset (the underlying
asset) for a period of time in exchange for consideration'. To
apply this definition the Group assesses whether the contract meets
three key evaluations which are whether:
-- The contract contains an identified asset, which is either
explicitly identified in the contract or implicitly specified by
being identified at the time the asset is made available to the
Group; and
-- The Group has the right to obtain substantially all the
economic benefits from use of the identified asset throughout the
period of use, considering its rights within the defined scope of
the contract; and
-- The Group has the right to direct the use of the identified
asset throughout the period of use. The Group assesses whether it
has the right to direct 'how and for what purpose' the asset is
used throughout the period of use.
At lease commencement date, the Group recognises a right-of-use
asset and a lease liability on the balance sheet. The right-of-use
asset is measured at cost, which is made up of the initial
measurement of the lease liability, any initial direct costs
incurred by the Group, an estimate of any costs to dismantle and
remove the asset at the end of the lease, and any lease payments
made in advance of the lease commencement date (net of any
incentives received).
The Group depreciates the right-of-use assets on a straight-line
basis from the lease commencement date to the earlier of the end of
the useful life of the right-of-use asset or the end of the lease
term. The Group also assesses the right-of-use asset for impairment
when such indicators exist.
At the commencement date, the Group measures the lease liability
at the present value of the lease payments unpaid at that date,
discounted using the interest rate implicit in the lease if that
rate is readily available or the Group's incremental borrowing
rate.
Lease payments included in the measurement of the lease
liability are made up of fixed payments, variable payments based on
an index or rate, amounts expected to be payable under a residual
value guarantee and payments arising from options reasonably
certain to be exercised.
Subsequent to initial measurement, the liability will be reduced
for payments made and increased for interest. It is remeasured to
reflect any reassessment or modification.
When the lease liability is remeasured, the corresponding
adjustment is reflected in the right-of-use asset, or income
statement if the right-of-use is already reduced to zero. The Group
has elected to account for short-term leases and leases of
low-value assets using the practical expedients. Instead of
recognising a right-of-use asset and lease liability, the payments
in relation to these are recognised as an expense in the income
statement on a straight-line basis over the lease term.
3.5) Inventories
Inventories in Zinc Communicate and The Edge comprise:
-- Cumulative costs incurred in relation to unpublished titles
or events, less provision for future losses, and are valued based
on direct costs plus attributable overheads based on a normal level
of activity. No element of profit is included in the valuation of
inventories.
-- Inventories comprise costs of unsold publishing stock and
costs on projects that are incomplete at the year-end less any
amounts recognised as cost of sales.
3.6) Impairment of assets
For the purposes of assessing impairment, non-financial assets
are grouped at the lowest levels for which there are separately
identifiable cash flows (cash-generating units). As a result, some
assets are tested individually for impairment, and some are tested
at the cash-generating unit level.
Goodwill is allocated to those cash generating units that are
expected to benefit from the synergies of the related business
combination and represent the lowest level within the Group at
which management monitors the related cash flows. Goodwill and
other individual assets or cash-generating units are tested for
impairment annually or whenever events / changes in circumstances
indicate that the carrying amount may not be recoverable.
An impairment loss is recognised for the amount by which the
assets or cash-generating unit's carrying amount exceeds its
recoverable amount. The recoverable amount is the higher of fair
value, reflecting market conditions less costs to sell, and value
in use based on an internal discounted cash flow evaluation.
Impairment losses recognised for cash-generating units, to which
goodwill has been allocated, are credited initially to the carrying
amount of goodwill. Any remaining impairment loss is charged pro
rata to the other assets in the cash generating unit. Except for
goodwill, all assets are subsequently reassessed for indications
that an impairment loss previously recognised may no longer
exist.
3.7) Current and deferred taxation
Current tax is the tax currently payable based on taxable
profit/(loss) for the year.
Deferred income taxes are calculated using the liability method
on temporary differences. Deferred tax is generally provided on the
difference between the carrying amounts of assets and liabilities
and their tax bases.
Deferred tax is not recognised in respect of:
-- the initial recognition of goodwill that is not tax deductible; and
-- the initial recognition of an asset or liability unless the
related transaction is a business combination or affects tax or
accounting profit. In addition, tax losses available to be carried
forward as well as other income tax credits to the Group are
assessed for recognition as deferred tax assets.
Deferred tax liabilities are provided in full, with no
discounting. Deferred tax assets are recognised to the extent that
it is probable that the underlying deductible temporary differences
will be able to be offset against future taxable income. Current
and deferred tax assets and liabilities are calculated at tax rates
and laws that are expected to apply to their respective year of
realisation, provided they are enacted or substantively enacted at
the reporting date.
Changes in deferred tax assets or liabilities are recognised as
a component of tax expense in the income statement, except where
they relate to items that are charged or credited directly to
equity in which case the related deferred tax is also charged or
credited directly to equity.
3.8) Financial instruments
Recognition of financial instruments
Financial assets and liabilities are recognised on the Group's
Statement of Financial Position when the Group becomes a party to
the contractual provisions of the instrument.
Financial assets
Initial and subsequent measurement of financial assets
Cash and cash equivalents
Cash and cash equivalents comprise cash at bank and in hand and
other short-term deposits held by the company with maturities of
less than three months.
Trade and other receivables
Trade receivables are initially measured at fair value. Other
receivables are initially measured at fair value plus transaction
costs. Receivables are subsequently measured at amortised cost
using the effective interest rate method.
Impairment of trade receivables
For trade receivables, expected credit losses are measured by
applying an expected loss rate to the gross carrying amount. The
expected loss rate comprises the risk of a default occurring and
the expected cash flows on default based on the aging of the
receivable. The risk of a default occurring always takes into
consideration all possible default events over the expected life of
those receivables ("the lifetime expected credit losses").
Different provision rates and periods are used based on groupings
of historic credit loss experience by product type, customer type
and location.
Impairment losses and any subsequent reversals of impairment
losses are adjusted against the carrying amount of the receivable
and are recognised in profit or loss.
Financial liabilities and equity
Financial liabilities and equity instruments are classified
according to the substance of the contractual arrangements entered
into. An equity instrument is any contract that evidences a
residual interest in the assets of the company after deducting all
of its liabilities.
Initial and subsequent measurement of financial liabilities
Trade and other payables
Trade and other payables are initially measured at fair value,
net of direct transaction costs and subsequently measured at
amortised cost.
Loan notes
Loan notes are initially recognised at fair value, adjusted for
transaction costs, and subsequently measured at amortised cost
using the effective interest rate method.
Finance charges, including premiums payable on settlement and
direct issue costs, are accounted for on an effective interest
method and are added to the carrying amount of the instrument to
the extent that they are not settled in the year in which they
arise.
Contingent consideration
The acquisition-date fair value of any contingent consideration
is recognised as part of the consideration transferred by the Group
in exchange for the acquiree. Changes in the fair value of
contingent consideration that result from additional information
obtained during the measurement period (maximum one year from the
acquisition date) about facts and circumstances that existed at the
acquisition date are adjusted retrospectively against goodwill.
Other changes resulting from events after the acquisition date are
recognised in profit or loss.
Equity instruments
Equity instruments issued by the Company are recorded at fair
value on initial recognition net of transaction costs.
Derecognition of financial assets (including write-offs) and
financial liabilities
A financial asset (or part thereof) is derecognised when the
contractual rights to cash flows expire or are settled, or when the
contractual rights to receive the cash flows of the financial asset
and substantially all the risks and rewards of ownership are
transferred to another party.
When there is no reasonable expectation of recovering a
financial asset it is derecognised ('written off').
The gain or loss on derecognition of financial assets measured
at amortised cost is recognised in profit or loss.
A financial liability (or part thereof) is derecognised when the
obligation specified in the contract is discharged, cancelled or
expires.
Any difference between the carrying amount of a financial
liability (or part thereof) that is derecognised, and the
consideration paid is recognised in profit or loss.
3.9) Employee benefits
Equity settled share-based payments
Where employees are rewarded using equity settled share-based
payments, the fair values of employees' services are determined
indirectly by reference to the fair value of the instrument granted
to the employee. This fair value is appraised at the grant date and
excludes the impact of non-market vesting conditions.
All equity-settled share-based payments are ultimately
recognised as an expense in the income statement with a
corresponding credit to reserves.
If vesting periods apply, the expense is allocated over the
vesting period, based on the best available estimate of the number
of share options expected to vest. Estimates are revised
subsequently if there is any indication that the number of share
options expected to vest differs from previous estimates. Any
cumulative adjustment prior to vesting is recognised in the current
year. No adjustment is made to any expense recognised in prior
years if share options that have vested are not exercised.
Retirement benefits
Obligations for contributions to defined contribution pension
plans are recognised as an expense in the income statement when
they are due.
3.10) Provisions
Provisions are recognised when: the Group has a present legal or
constructive obligation as a result of past events; it is probable
that an outflow of resources will be required to settle the
obligation; and the amount has been reliably estimated.
Provisions are measured at the present value of the expenditures
expected to be required to settle the obligation using a pre-tax
rate that reflects current market assessments of the time value of
money and the risks specific to the obligation. Any increase in the
provision due to the passage of time is recognised as interest
expense.
3.11) Foreign currencies
Transactions in foreign currencies are recorded using the rate
of exchange ruling at the date of the transaction. Monetary assets
and liabilities denominated in foreign currencies are translated
using the rate of exchange ruling at the balance sheet date and the
gains or losses on translation are included in the income
statement.
3.12) Significant judgements and estimates
The preparation of consolidated financial statements in
accordance with UK-adopted International Accounting Standards
requires the Group to make estimates and assumptions that affect
the application of policies and reported amounts. Estimates and
judgements are continually evaluated and are based on historical
experience and other factors including expectations of future
events that are believed to be reasonable under the circumstances.
Actual results may differ from these estimates. The estimates and
assumptions which have a significant risk of causing a material
adjustment to the carrying amount of assets and liabilities are
discussed below.
i) Judgements
Revenue recognition
The main judgements regarding revenue recognition relate to TV
production and content production revenue. The Group considers the
production and licence elements to be a combined performance
obligation to be satisfied and recognised over time. This is
explained in note 3.1.
ii) Estimates
Impairment of goodwill and intangible assets
The Group is required to test, at least annually, whether
goodwill has suffered any impairment. The recoverable amount is
determined based on value in use calculations. The use of this
method requires the estimation of future cash flows and the choice
of a suitable discount rate to calculate the present value of these
cash flows. Actual outcomes could vary. See note 12 for details of
how these judgements are made and the estimation sensitivities
disclosed.
Valuation of intangibles arising on acquisition
The intangible assets acquired on the acquisition of The Edge
Picture Co Limited have been valued using the income approach. This
involves forecasting the expected future economic benefits
attributable to an asset and calculating the net present value of
these future economic benefits using an appropriate asset specific
discount rate. The discount rate used has factored in the market
rate of return, the specific risks associated with the industry as
well as the risk associated with the asset being valued. See note
23 for more detail on the acquisition.
Valuation of contingent consideration
The contingent consideration payable in relation to the
acquisition of The Edge has been measured at its fair value using a
Monte Carlo simulation where the EBIT of each of the three years of
the earn out period is an independent, normally distributed random
variable. Values have been calculated for all three years and the
total, and the average of these represents the fair value.
Estimation sensitivity has been disclosed in note 20.
3.13) Segmental reporting
In identifying its operating segments, management follows the
Group's service lines, which represent the main products and
services provided by the Group. The activities undertaken by the TV
segment include the production of television content. The Content
Production segment includes brand and corporate film production,
radio and podcast production and publishing.
Each of these operating segments is managed separately as each
service line requires different resources as well as marketing
approaches. All inter-segment transfers are carried out at arm's
length prices.
The measurement policies the Group uses for segment reporting
under IFRS 8 are the same as those used in its financial
statements.
4) SEGMENTAL INFORMATION AND REVENUE
Segmental information
The chief operating decision maker, who is responsible for
allocating resources and assessing performance of the operating
segments, has been identified as the Board of Directors who
categorise the Group's two service lines as two operating segments:
Television and Content Production. These operating segments are
monitored, and strategic decisions are made on the basis of
adjusted segment operating results.
Central
TV Content Production and plc Total
---------------------------- ------------------- ---------
2022 2021 2022 2021 2022 2021 2022 2021
Continuing GBP GBP GBP GBP GBP GBP
Operations GBP '000 GBP '000 '000 '000 '000 '000 '000 '000
--------- --------- -------- -------- -------- -------- --------- ---------
Revenue 20,218 14,565 9,865 2,926 - - 30,083 17,491
----------------- --------- --------- -------- -------- -------- -------- --------- ---------
Adjusted EBITDA 611 932 573 (241) (1,109) (1,303) 75 (612)
Depreciation (541) (582) (192) (48) (214) (151) (947) (782)
Amortisation - - (10) - (705) (704) (715) (704)
Adjusting Items
and acquisition
costs (83) (6) (68) (51) (1,143) (211) (1,293) (267)
Operating profit
/ (loss) (13) 344 303 (340) (3,171) (2,369) (2,880) (2,365)
----------------- --------- --------- -------- -------- -------- -------- --------- ---------
Finance costs (5) (12) (11) - (374) (229) (390) (241)
Finance income - 0 1 - - - 1 0
--------- ---------
Loss before
tax (18) 332 293 (340) (3,545) (2,597) (3,269) (2,606)
----------------- --------- ---------
Taxation
credit/(charge) (5) 4 828 - 164 82 987 86
--------- --------- -------- -------- -------- -------- ---------
Loss for the
year (23) 336 1,122 (340) (3,381) (2,515) (2,282) (2,520)
----------------- --------- --------- -------- -------- -------- -------- --------- ---------
Segment Assets 11,775 12,571 7,175 2,151 5,158 862 24,107 15,584
Segment
Liabilities (16,326) (15,294) (3,748) (1,207) 2,926 4,664 (17,149) (11,837)
----------------- --------- --------- -------- -------- -------- -------- --------- ---------
Other Segment
items:
Expenditure
on intangible
assets - - 50 - 4,394 108 4,444 108
Expenditure
on tangible
assets 190 236 544 6 97 862 831 1,104
* Adjusted EBITDA is defined as earnings before interest, tax,
depreciation, amortisation and adjusting items as set out in
note.
Items included under 'Central and Plc' do not constitute an
operating segment and relate mainly to Group activities based in
the United Kingdom. Central and plc costs relate to Directors,
support functions and costs resulting from being listed.
The internal reporting of the Group's performance does not
require that costs and/or Statement of Financial Position
information is gathered based on the geographical streams.
The Group's principal operations are in the United Kingdom. Its
revenue from external customers in the United Kingdom for the year
was GBP24.7m (year ended 31 December 2021: GBP16.0m), and the total
revenue from external customers in other countries was GBP5.4m
(2021: GBP1.5m). There were two customers that accounted for more
than 10% of Group revenue in the year: one customer accounted for
GBP7.3m or 24% of Group revenue and the other customer accounted
for GBP5.9m or 20% of Group revenue (2021: one customer accounted
for GBP3.8m revenue).
Non-current assets are all located in the Group's country of
domicile.
Revenue
Contract balances
The following table provides information about receivables,
contract assets and contract liabilities from contracts with
customers.
2022 2021
GBP'000 GBP'000
----------------------------------------------- -------- --------
Receivables, which are included in 'Trade and
other receivables' 6,515 2,060
Contract assets 2,545 1,502
Contract liabilities (1,895) (1,068)
------------------------------------------------ -------- --------
The contract assets primarily relate to the Group's rights to
consideration for work completed but not billed at the reporting
date on contracts with customers. The contract assets are
transferred to receivables when the milestones per the production
agreements are met and an invoice is raised. The contract
liabilities primarily relate to the advance consideration received
from customers for TV production related contracts, for which
revenue is recognised on the percentage stage of completion of the
production.
Significant changes in the contract assets and the contract
liabilities balances during the year are as follows.
2022
Contract Contract
assets liabilities
GBP'000 GBP'000
------------------------------------------------------ --------- -------------
Opening balance 1 January 2022 1,502 (1,068)
Revenue recognised that was included in the contract
liability balance at the beginning of the period - 1,068
Increases due to cash received, excluding amounts
recognised as
revenue during the period - (1,006)
Transfers from contract assets recognised at the
beginning of the
period to receivables (1,502) -
Increases as a result of changes in the measure
of progress 2,132 -
Increase as a result of The Edge acquisition 413 (889)
------------------------------------------------------ --------- -------------
Closing balance 31 December 2022 2,545 (1,895)
------------------------------------------------------ --------- -------------
Transaction price allocated to the remaining performance
obligations
The Group has applied the practical expedient in paragraph 121
of IFRS 15 and chosen not to disclose information relating to
performance obligations for contracts that had an original expected
duration of one year or less, or where the right to consideration
from a customer is an amount that corresponds directly with the
value of the completed performance obligations.
5) EXPENSES BY NATURE
Costs from continuing operations consist of:
2022 2021
GBP'000 GBP'000
---------------------------------- -------- --------
Cost of sales
Production costs 16,813 7,660
Salary costs 2,250 1,803
Royalties and distribution costs 817 1,296
Total cost of sales 19,880 10,759
---------------------------------- -------- --------
Operating expenses
Salary costs 7,815 6,402
Leases on premises 10 6
Other administrative expenses 2,296 932
Foreign exchange gain 7 4
Adjusting Items 1,293 267
Depreciation and Amortisation 1,662 1,486
Total operating expenses 13,083 9,097
---------------------------------- -------- --------
Furlough income in the year totalled GBPnil (2021: GBP71k), this
is included in salary costs in both operating expenses and cost of
sales.
Auditor, tax and share option advisor fees are included in other
administrative expenses. The auditor did not provide any non-audit
services in the current or prior year. The fee for statutory audit
services was as follows:
2022 2021
GBP'000 GBP'000
-------------------------------------------------- -------- --------
Statutory audit services
Annual audit of the company and the consolidated
accounts 189 107
6) STAFF COSTS
Staff costs from continuing operations, including directors,
consist of:
2022 2021
GBP'000 GBP'000
------------------------------- -------- --------
Wages & salaries 8,682 6,888
Social security & other costs 994 778
Pension costs 359 509
Share based payment charge 180 122
Consideration paid in shares 30 30
Total 10,245 8,327
------------------------------- -------- --------
The average number of employees (including directors) employed
by the Group for continuing operations during the year was:
2022 2021
-------------------- ----- -----
Zinc Television 134 115
Content Production 82 45
Central and Plc 8 8
Total 224 168
-------------------- ----- -----
The directors consider that the key management comprises the
directors of the company, and their emoluments are set out
below:
Directors' emoluments
2022 2021
--------------------------- ---------- --------- -------- --------- -------- -------- --------
Salaries Benefits
and fees in kind Bonus Shares Pension Total Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------------------- ---------- --------- -------- --------- -------- -------- --------
Executive Directors
Mark Browning 270 - 135 - 27 432 459
Will Sawyer 159 - 80 - 16 255 246
Non-Executive Directors
Christopher Satterthwaite
(Chairman) 50 - - 30 - 80 80
Nicholas Taylor 18 - - - 12 30 30
Andrew Garard 30 - - - - 30 30
527 - 215 30 55 827 845
--------------------------- ---------- --------- -------- --------- -------- -------- --------
The executive director bonuses solely relate to the successful
acquisition, integration and fundraise related to The Edge Picture
Co. Almost 40% of the bonuses received by the executive directors
were re-invested back in the Group via an equity fundraise during
the year.
Key management personnel compensation
2022 2021
GBP'000 GBP'000
-------------------------------------------------- -------- --------
Short term employee benefits (includes employers
NICs) 840 870
Post-employment benefits 55 54
Shares (includes employers NICs) 34 34
Share-based payments charge 129 101
-------------------------------------------------- -------- --------
Total 1,058 1,059
-------------------------------------------------- -------- --------
The amount for share based payments charge (see note 7) which
relates to the Directors was GBP129k (2021: GBP101k).
7) SHARE BASED PAYMENTS
The charge for share based payments arises from the following
schemes:
2022 2021
GBP'000 GBP'000
EMI share option scheme 104 74
Unapproved share option scheme 76 48
Total 180 122
-------------------------------- -------- --------
The share based payment charge for options granted since
February 2020 are calculated using a Stochastic model and options
granted prior to February 2020 have been valued using the Black
Scholes model.
Share options held by directors are disclosed in the Directors'
Report.
Share Option Schemes
Under the terms of the EMI and unapproved share option schemes,
the Board may offer options to purchase ordinary share options to
employees and other individuals. Share options granted under the
Group's schemes are normally exercisable for a ten-year period. The
vesting period is from the date of grant up to three years. Some of
the EMI share options and unapproved share options have market
criteria that mean they only vest if the share price is at a
minimum level at that point.
Details of the number of share options and the weighted average
exercise price (WAEP) outstanding during the year are as
follows:
Unapproved share option
scheme
------------------------------ -------- ------------------ -------- ---------
2022 2021
Number WAEP GBP Number WAEP GBP
------------------------------ -------- ------------------ -------- ---------
Outstanding at the beginning
of the year 886,546 0.014 173,201 2.527
Transferred from EMI scheme 26,605 0.670 2,000 3.750
Granted - - 711,345 0.001
Lapsed during the year - - - -
------------------------------ --------
Outstanding at the end
of the year 913,151 0.033 886,546 0.014
------------------------------ -------- ------------------ -------- ---------
Exercisable at the end
of the year - - - -
------------------------------ -------- ------------------ -------- ---------
EMI Share option scheme
2022 2021
WAEP
Number WAEP GBP Number GBP
------------------------------- ---------- --------- ---------- ------
Outstanding at the beginning
of the year 1,097,104 0.390 566,144 0.784
Granted during the year 151,622 0.875 539,960 0.683
Lapsed during the year (70,211) 0.713 (7,000) 3.921
Transferred to unapproved
scheme (26,605) 0.670 (2,000) 3.750
Outstanding at the end of
the year 1,151,909 0.428 1,097,104 0.390
------------------------------- ---------- --------- ---------- ------
Exercisable at the end of
the year - - - -
------------------------------- ---------- --------- ---------- ------
The options outstanding as at 31 December 2022 have the
following exercise prices and expire in the following financial
years:
Exercise
Expiry Grant Date Price 2022 2021
GBP No. No.
--------------- ----------
December 2026 December 2016 3.75 6,000 6,000
November 2027 November 2017 4.15 5,000 5,000
April 2028 April 2018 3.75 4,000 4,000
November 2028 November 2018 2.00 6,000 6,000
February 2030 February 2020 0.0013 711,345 711,345
June 2031 June 2021 0.0013 711,345 711,345
June 2031 June 2021 0.6695 268,237 337,449
November 2031 November 2021 0.7060 202,511 202,511
December 2032 December 2022 0.8750 151,622 -
2,066,060 1,983,650
-------------------------------
No options were exercised or expired during the periods covered
by the above tables.
Options are forfeited at the discretion of the Board if the
employee leaves the Group before the options vest. The Share Option
Plan provides for the grant of both tax-approved Enterprise
Management Incentives (EMI) options and unapproved options. The
model used to calculate a share option charge involves using
several estimates and judgements to establish the appropriate
inputs, covering areas such as the use of an appropriate interest
rate and dividend rate, exercise restrictions and behavioural
considerations. A significant element of judgement is therefore
involved in the calculation of the charge.
Options issued in December 2022
The Group issued 151,622 share options to senior member of staff
of Zinc Media Group on the 12(th) of December 2022 under the
Company's EMI Share Option Plan.
The options are exercisable at 87.5 pence per share on or after
the third anniversary of their grant. Half the options will vest if
the share price is at least GBP1.3125 for a period of 30
consecutive dealing days ending on or after 12(th) of December
2025. The remaining half of the Options will vest unconditionally
on the third anniversary of the grant date, being 12 December
2025.
The inputs into the option pricing model for the options granted
in December 2022 are as follows:
Scheme EMI
---------------------------------------------------- -----------
Weighted average share exercise price 87.5 pence
Weighted average expected volatility - tranche
1 47.15%
Weighted average expected volatility - tranche
2 61.05%
Average expected life (years) - tranche 1 4.3 years
Average expected life (years) - tranche 2 6.5 years
Weighted average risk-free interest rate - tranche
1 3.25%
Weighted average risk-free interest rate - tranche
2 3.27%
Expected dividend yield 0%
---------------------------------------------------- -----------
The expected volatility was calculated over a period of five
years immediately prior to the date of the grant. The risk-free
interest rate has been calculated using the gilt rates over a
period of five years from the date of grant.
8) ADJUSTING ITEMS
2022 2021
GBP'000 GBP'000
---------------------------------------- -------- --------
Adjusting Items
Reorganisation and restructuring costs (160) (81)
Acquisition costs (953) (60)
Share based payment charge (180) (122)
Loss on disposal of tangible assets - (4)
Total (1,293) (267)
---------------------------------------- -------- --------
Adjusting items are presented separately as, due to their nature
or for the infrequency of the events giving rise to them, this
allows shareholders to understand better the elements of financial
performance for the year, to facilitate comparison with prior years
and to assess better the trends of financial performance.
Reorganisation and restructuring costs
Management made changes to operational roles across the Group to
improve efficiency and decision making. The non-recurring element
of the costs has been presented as adjusting to enable a more
refined evaluation of financial performance.
Acquisition costs
Acquisition costs represent costs incurred in the acquisition of
The Edge Picture Co during the year. These costs are non-recurring
in nature and are therefore treated as an adjusting item for
management to better understand the underlying performance of the
Group in the year. These costs are also included in operating
activities in the cash flow statement.
9) FINANCE COSTS
2022 2021
Finance Costs GBP'000 GBP'000
--------------------------------------- -------- --------
Interest payable on borrowings (336) (176)
Interest payable on lease liabilities (54) (65)
Finance Costs (390) (241)
--------------------------------------- -------- --------
Finance Income
Interest received 1 -
--------------------------------------- -------- --------
Net finance costs (389) (241)
--------------------------------------- -------- --------
10) INCOME TAX EXPENSE
Taxation Charge/credit
2022 2021
GBP'000 GBP'000
--------------------------------------------------- -------- --------
Current tax expense:
Current tax expense 4 4
Charge in respect of prior periods - -
4 4
--------------------------------------------------- -------- --------
Deferred tax
Origination and reversal of temporary differences (953) (126)
Effect of change in UK corporation tax rate (39) 42
Adjustments in respect of prior periods 1 (6)
(991) (90)
--------------------------------------------------- -------- --------
Total income tax credit (987) (86)
--------------------------------------------------- -------- --------
Reconciliation of taxation expense:
2022 2021
GBP'000 GBP'000
-------------------------------------------------- -------- --------
Loss before tax (3,269) (2,606)
-------------------------------------------------- -------- --------
Taxation expense at UK corporation tax rate
of 19% (2021: 19%) (621) (495)
Other non-taxable income/non-deductible expenses 239 54
Tax losses (recognised)/not recognised (610) 311
Group relief (claimed)/surrendered (4) 4
Effect of changes in UK corporation tax rates (39) 42
Varying tax rates of overseas earnings (100) -
Adjustments to tax charge in respect of previous 147 -
years
Charge in respect of prior periods 1 (2)
Total income tax credit (987) (86)
-------------------------------------------------- -------- --------
11) EARNINGS PER SHARE
Basic loss per share (EPS) for the period is calculated by
dividing the loss for the year attributable to ordinary equity
holders of the parent by the weighted average number of ordinary
shares outstanding during the year.
When the Group makes a profit from continuing operations,
diluted EPS equals the profit attributable to the Company's
ordinary shareholders divided by the diluted weighted average
number of issued ordinary shares. When the Group makes a loss from
continuing operations, diluted EPS equals the loss attributable to
the Company's ordinary shareholders divided by the basic
(undiluted) weighted average number of issued ordinary shares. This
ensures that EPS on losses is shown in full and not diluted by
unexercised share options or awards.
2022 2021
Number of Shares Number of Shares
Weighted average number of
shares used in basic and diluted
earnings per share calculation 18,480,039 16,095,991
Potentially dilutive effect
of share options 1,558,184 1,117,890
GBP'000 GBP'000
------------------------------------------ ----------------- -----------------
Loss for the year from continuing
operations attributable to shareholders (2,297) (2,544)
Continuing operations
Basic Loss per share (pence) (12.43)p (15.80)p
Diluted Loss per share (pence) (12.43)p (15.80)p
12) INTANGIBLE ASSETS
Customer Software Distribution Order
Goodwill Brands Relationships Catalogue Book Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP000
Cost
At 31 December
2020 29,394 4,497 3,419 230 443 - 37,983
Other changes* (20,441) (3,818) (116) - - - (24,375)
---------------- --------- -------- -------------- --------- ------------- -------- ---------
At 31 December
2021 8,953 679 3,303 230 443 - 13,608
Additions - - - 50 - - 50
Acquired
through
business
combinations 1,503 1,464 1,450 - - 119 4,536
---------------- --------- -------- -------------- --------- ------------- -------- ---------
At 31 December
2022 10,456 2,143 4,753 280 443 119 18,194
---------------- --------- -------- -------------- --------- ------------- -------- ---------
Amortisation
and impairment
At 31 December
2020 (26,339) (4,289) (2,444) (126) (281) - (33,479)
Charge for the
year - (97) (464) (54) (89) - (704)
Other changes* 20,441 3,818 116 - - - 24,375
---------------- --------- -------- -------------- --------- ------------- -------- ---------
At 31 December
2021 (5,898) (568) (2,792) (180) (370) - (9,808)
Charge for the
year - (113) (351) (59) (73) (119) (715)
At 31 December
2022 (5,898) (681) (3,143) (239) (443) (119) (10,523)
---------------- --------- -------- -------------- --------- ------------- -------- ---------
Net Book Value
At 31 December
2022 4,558 1,462 1,610 41 - - 7,671
---------------- --------- -------- -------------- --------- ------------- -------- ---------
At 31 December
2021 3,055 111 511 50 73 - 3,800
---------------- --------- -------- -------------- --------- ------------- -------- ---------
* The goodwill, brands and customer relationship intangibles
have been de-recognised as they were previously fully amortised or
impaired.
Impairment Tests for Goodwill
Goodwill by cash generating unit is:
2022 2021
GBP'000 GBP'000
Tern TV CGU 1,444 1,444
London & Manchester TV CGU 1,611 1,611
The Edge CGU 1,503 -
Total 4,558 3,055
---------------------------- -------- --------
Goodwill is not amortised but tested annually for impairment
with the recoverable amount being determined from value in use
calculations. The key assumptions for the value in use calculations
are those regarding the discount rate, growth rates, gross margins
and forecasts in new business.
The Group assessed whether the carrying value of goodwill was
supported by the discounted cash flow forecasts of each operating
segment based on financial forecasts approved by management, taking
into account both past performance and expectations for future
market developments. Management has used a perpetuity model (5-year
Group forecast and GDP growth rate in perpetuity). Management
estimates the discount rate using a pre-tax rate that reflects
current market assessments of the time value of money and the risks
specific to media businesses.
The 2023 business unit forecasts are based on the budget set for
the year. In TV a growth rate of 2 per cent has been used for the
following years into perpetuity. Management believes the 2 per cent
growth rate does not exceed the growth rate of the industry and is
a cautious assumption, which may be significantly lower than the
growth rate management would expect to achieve.
In evaluating the recoverable amount, the discounted cash flow
methodology has been employed, which is based on assumptions and
judgements related to forecasts, margins, discount rates and
working capital needs. These estimates will differ from actuals in
the future and could therefore lead to material changes to the
recoverable amounts. The key assumptions used for estimating cash
flow projections in the Group's impairment testing are those
relating to EBITDA growth, which take account of the businesses'
expectations for the projection period. These expectations consider
the macroeconomic environment, industry and market conditions, the
unit's historical performance and any other circumstances
particular to the unit, such as business strategy and client
mix.
The three cash generating units operate in a similar media
landscape and the pre-tax discount rate applied across the segments
for period ended 31 December 2022 was 9.1 per cent (2021: 10 per
cent). A sensitivity analysis of an increase in the discount rate
by 2.4 per cent is shown below.
London & Manchester TV and Tern TV CGUs
Changes in assumptions can have a significant effect on the
recoverable amount and therefore the value of the impairment
recognised.
Assumption Judgement Sensitivity
Discount As indicated above the rate An increase in the discount
Rate used is 9.1 per cent. rate to 11.5 per cent will
result in no impairment charge.
---------------------------------- ---------------------------------
Revenue London & Manchester TV's If there is a shortfall in
and Gross and Tern TV's CGU revenue revenue of 20% or a reduction
Margins for 2023 is forecast to in gross margin of 4%, there
increase and London & Manchester would be no impairment charge.
TV's gross margin is forecast
to increase.
---------------------------------- ---------------------------------
EBITDA growth An average rate of 2 per If a zero per cent average
Rate cent has been used for financial growth rate was applied for
year 2025 onwards. 2024 onwards there would be
no impairment in any of the
CGU's.
---------------------------------- ---------------------------------
Sensitivity analysis using reasonable variations in the
assumptions shows no indication of impairment.
13) PROPERTY, PLANT AND EQUIPMENT
Office
Short leasehold Motor and computer
land and buildings vehicles equipment Total
GBP'000 GBP'000 GBP'000 GBP'000
Cost
At 31 December 2020 664 35 3,234 3,933
Additions - - 273 273
Disposals and retirements (240) (22) (1,893) (2,155)
At 31 December 2021 424 13 1,614 2,051
Additions 24 - 331 355
Disposals and retirements - - (17) (17)
Acquired through business
combinations - 8 185 193
At 31 December 2022 448 21 2,113 2,582
--------------------------- -------------------- ---------- -------------- --------
Depreciation
At 31 December 2020 (358) (35) (2,606) (2,999)
Charge for the period (73) - (219) (292)
Disposals and retirements 244 22 1,878 2,144
At 31 December 2021 (187) (13) (947) (1,147)
Charge for the period (76) (1) (319) (396)
Disposals and retirements - - 17 17
At 31 December 2022 (263) (14) (1,249) (1,526)
--------------------------- -------------------- ---------- -------------- --------
Net Book Value
At 31 December 2022 185 7 864 1,056
--------------------------- -------------------- ---------- -------------- --------
At 31 December 2021 237 - 667 904
--------------------------- -------------------- ---------- -------------- --------
14) INVENTORIES
31 Dec 31 Dec
2022 2021
GBP'000 GBP'000
------------------- -------- --------
Work in progress 73 226
Total Inventories 73 226
------------------- -------- --------
15) TRADE AND OTHER RECEIVABLES
31 Dec 31 Dec
2022 2021
GBP'000 GBP'000
------------------------------- -------- --------
Current
Trade receivables 6,872 2,609
Less provision for impairment (380) (549)
------------------------------- -------- --------
Net trade receivables 6,492 2,060
Prepayments 507 325
Other receivables 1,047 -
Contract assets 2,545 1,502
------------------------------- -------- --------
Total 10,591 3,887
------------------------------- -------- --------
The carrying amount of trade and other receivables approximates
to their fair value. The creation and release of provision for
impaired receivables have been included in administration expenses
in the income statement.
The maximum exposure to credit risk at the reporting date is the
carrying value of each class of asset above. The Group does not
hold any collateral as security for trade receivables. The Group is
not subject to any significant concentrations of credit risk.
There is no expected credit loss in relation to contract assets
recognised because the measure of expected credit losses is not
material to the financial statements.
Impairment of financial assets
The group's credit risk management practices and how they relate
to the recognition and measurement of expected credit losses are
set out below.
Definition of default
The loss allowance on all financial assets is measured by
considering the probability of default.
Receivables are considered to be in default when the principal
or any interest is significantly more than the associated credit
terms past due, based on an assessment of past payment practices
and the likelihood of such overdue amounts being recovered.
Write-off policy
Receivables are written off by the Group when there is no
reasonable expectation of recovery, such as when the counterparty
is known to be going bankrupt, or into liquidation or
administration.
Impairment of trade receivables and contract assets
The group calculates lifetime expected credit losses for trade
receivables using a portfolio approach. Receivables are grouped
based on the credit terms offered and the type of product sold. The
probability of default is determined at the year-end based on the
aging of the receivables and historical data about default rates on
the same basis. That data is adjusted if the Group determines that
historical data is not reflective of expected future conditions due
to changes in the nature of its customers and how they are affected
by external factors such as economic and market conditions.
As noted below, a loss allowance of GBP380,000 (2021:
GBP549,000) has been recognised for trade receivables in the Zinc
Communicate division based on the expected credit loss percentages
for trade receivables that are aged more than 30 days to over a
year past due and reflecting future conditions. The loss allowance
relates to the Building Control Communications sub-division within
Zinc Communicate, which has been assessed separately to other Zinc
Communicate sub-divisions because it has a different debt
collection profile due to its focus selling low value / high volume
adverts for publications.
In relation to the Television division, the directors do not
believe there are any other forward-looking factors to consider in
calculating the loss allowance provision as at 31 December 2022. No
expected loss provision has been recognised as the directors expect
any loss to be immaterial.
No expected credit loss is expected for contract assets (2021:
GBPnil).
Television
Aging
0-30 30-60 60-90 90-120 120-150 150-365 Over Total
Trade receivables: days days days days days days 365 days 2022
----------------------- ------ ------ ------ ------- -------- -------- ---------- ------
Gross carrying
amount (GBP'000) 781 590 172 106 - - - 1,649
----------------------- ------ ------ ------ ------- -------- -------- ---------- ------
Loss allowance
provision (GBP'000) - - - - - - - -
The expected credit loss in this division is immaterial.
The Edge
Aging Over
Trade 0-30 30-60 60-90 90-120 120-150 150-365 365 Total
receivables: days days days days days days days 2022
--------------- ------------------------------------------------------- ---------------------- ------------------- ------------------ -------- -------- ----- -----------------
Gross carrying
amount
(GBP'000) 1,406 1,126 303 366 - - - 3,201
--------------- ------------------------------------------------------- ---------------------- ------------------- ------------------ -------- -------- ----- -----------------
Loss allowance
provision -
(GBP'000) - - - - - - -
The expected credit loss in this division is immaterial.
Zinc Communicate - Publishing "Building Control Communications"
division
Aging Over
0-30 30-60 60-90 90-120 120-150 150-365 365 Total
Trade receivables: days days days days days days days 2022
----------------------- ------ ------ ------ ------- -------- -------- -------- ------
Expected loss
rate (%) 12% 15% 18% 20% 23% 37% 51% 34%
Gross carrying
amount (GBP'000) 131 130 128 57 50 354 416 1,266
----------------------- ------ ------ ------ ------- -------- -------- -------- ------
Loss allowance
provision (GBP'000) 15 18 21 10 10 116 190 380
----------------------- ------ ------ ------ ------- -------- -------- -------- ------
Zinc Communicate - All other divisions
Aging Over
0-30 30-60 60-90 90-120 120-150 150-365 365 Total
Trade receivables: days days days days days days days 2022
----------------------- ------ ------ ------ ------- -------- -------- -------- ------
Gross carrying
amount (GBP'000) 549 113 68 27 - - - 757
----------------------- ------ ------ ------ ------- -------- -------- -------- ------
Loss allowance
provision (GBP'000) - - - - - - - -
----------------------- ------ ------ ------ ------- -------- -------- -------- ------
The expected credit loss in this division is immaterial.
16) CASH AND CASH EQUIVALENTS
31 Dec 31 Dec
2022 2021
GBP'000 GBP'000
--------------------------------- -------- --------
Total Cash and cash equivalents 3,632 5,608
--------------------------------- -------- --------
The Group's credit risk exposure in connection with the cash and
cash equivalents held with financial institutions is managed by
holding funds in a high credit worthy financial institution
(Moody's A1- stable).
17) TRADE AND OTHER PAYABLES
31 Dec 31 Dec
2022 2021
GBP'000 GBP'000
---------------------------------- -------- --------
Current
Trade payables 1,415 764
Other payables 492 133
Other taxes and social security 1,149 1,348
Accruals 4,139 3,486
Contract liabilities 1,895 1,068
Contingent consideration payable 663 -
Total 9,753 6,799
Non-Current
Contingent consideration payable 2,476 -
---------------------------------- -------- --------
Total 12,229 6,799
---------------------------------- -------- --------
The Directors consider that the carrying amount of trade and
other payables approximates to their fair value. The Group's
payables are unsecured.
18) LEASES UNDER IFRS 16
Right-of-use assets
Office and
Short leasehold computer
land and buildings equipment Total
GBP'000 GBP'000 GBP'000
Balance as at 1 January 2021 1,073 204 1,277
Additions 373 - 373
Depreciation (407) (82) (489)
---------------------------------------- -------------------- ----------- --------
Balance as at 31 December 2021 1,039 122 1,161
Additions - 42 42
Acquired through business combinations 433 - 433
Depreciation (455) (97) (552)
Balance as at 31 December 2022 1,017 67 1,084
---------------------------------------- -------------------- ----------- --------
Lease liabilities are presented in the statement of financial
position as follows:
31 Dec 31 Dec
2022 2021
GBP'000 GBP'000
------------------------- -------- --------
Current 675 431
Non-current 352 735
Total lease liabilities 1,027 1,166
------------------------- -------- --------
The Groups future minimum lease payments are as follows:
31 Dec 31 Dec
2022 2021
GBP'000 GBP'000
--------------------------------- -------- --------
Not later than 1 year 707 475
Later than 1 year and not later
than 5 years 312 413
Later than 5 years 50 282
1,069 1,170
--------------------------------- -------- --------
19) BORROWINGS AND OTHER FINANCIAL LIABILITIES
31 Dec 31 Dec
2022 2021
GBP'000 GBP'000
-------------------------------------- -------- --------
Current
Lease liabilities 675 431
Debt facility - unsecured borrowings - 2,450
Loan notes - unsecured borrowings - 978
Sub total 675 3,859
-------------------------------------- -------- --------
Non-current
Debt facility - unsecured borrowings 2,512 -
Loan notes - unsecured borrowings 978 -
Lease liabilities 352 735
Sub total 3,842 735
-------------------------------------- -------- --------
Total 4,517 4,594
-------------------------------------- -------- --------
Maturity of Financial Liabilities
The maturity of borrowings (analysed by remaining contractual
maturity) is as follows:
31 Dec 31 Dec
2022 2021
GBP'000 GBP'000
---------------------------------- -------- --------
Repayable within one year and on
demand:
Lease liabilities 707 475
Trade and other payables 1,907 897
Accrued expenses 4,139 3,486
Debt facility - unsecured - 2,531
Loan notes - unsecured - 1,189
Contingent consideration 663 -
7,416 8,578
---------------------------------- -------- --------
Repayable between one and two years:
Lease liabilities 312 413
Debt facility - unsecured 3,080 -
Loan notes - unsecured 1,111 -
4,503 413
--------------------------------------- ------- ------
Repayable between two and five years:
Lease liabilities 50 282
Contingent consideration 2,476 -
--------------------------------------- ------- ------
2,526 282
--------------------------------------- ------- ------
Total 14,445 9,273
--------------------------------------- ------- ------
Debt Facility
Loans totalling GBP2.5m (2021: GBP2.5m) are held by Herald
Investment Trust Plc and The John Booth Charitable Foundation
("JBCF"), all of whom are a related party through shareholding.
During the year the interest on the facility is based on monthly
SONIA plus a margin of 4%, subject to a floor of RPI. The debt
facility is unsecured and is repayable in full on 31 December 2024.
There are no financial covenants in force in respect of this debt
facility.
Loan notes - unsecured
The unsecured loan notes of GBP1.0m (2021: GBP1.0m) relates to
short-term loan notes issued to Herald Investment Trust plc, a
related party through shareholding. Interest during the year was at
a fixed rate of 8%. The loan notes are repayable in full on 31
December 2024. There are no financial covenants in place in respect
of this debt.
Finance leases
Net obligations under finance leases are secured on related
property, plant and equipment and are included within lease
liabilities.
Overdraft
The Group has an overdraft facility of GBP600k, which is secured
over the assets of subsidiary companies. During the year the Group
has not drawn upon the overdraft facility in place. The interest
rate on the overdraft is 5.3% per annum over the Bank of England
rate.
Change in liabilities arising from financing activities
Interest Interest Non-cash 31
31 Dec Cash charged paid changes Dec
2021 flows 2022
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
---------------------------- -------- -------- --------- --------- --------- --------
Borrowings - debt facility 2,450 - 249 (187) - 2,512
Borrowings - loan notes 978 - 78 (78) - 978
Lease liabilities 1,166 (612) 57 - 416 1,027
---------------------------- -------- -------- --------- --------- --------- --------
Total liabilities from
financing activities 4,594 (612) 384 (265) 416 4,517
---------------------------- -------- -------- --------- --------- --------- --------
20) FINANCIAL INSTRUMENTS
The Group's financial instruments comprise borrowings, cash and
liquid resources and various items, such as trade and other
receivables and trade and other payables that arise directly from
its operations. The main purpose of these financial instruments is
to raise finance for the Group's operations.
The principal financial risk faced by the Group is
liquidity/funding. The policies and strategies for managing this
risk is summarised as follows:
Risk Potential impact How it is managed
Liquidity The Group's debt servicing The Group's treasury function
requirements and investment is principally concerned
strategies, along with with internal funding requirements,
the diverse nature of debt servicing requirements
the Group's operations, and funding of new investment
means that liquidity management strategies.
is recognised as an important
area of focus. Internal funding and debt
servicing requirements are
Liquidity issues could monitored on a continuing
have a negative reputational basis through the Group's
impact, particularly with management reporting and
suppliers. forecasting. The Group also
maintains a continuing dialogue
with the Group's lenders
as part of its information
covenants. The requirements
are maintained through a
combination of retained
earnings, asset sales or
capital markets.
An overdraft of GBP0.6m
is in place to help fund
potential working capital
fluctuations.
New investment strategies
are to be funded through
existing working capital
or where possible capital
markets.
--------------------------------- -------------------------------------
Capital management policy and risk management
The Group manages its capital to ensure that entities in the
Group will be able to continue as a going concern while maximising
the return to shareholders through the optimisation of the debt and
equity balance. The capital structure of the Group consists of
debts, which include the borrowings disclosed in note 19, cash and
cash equivalents and equity attributable to the owners of the
parent, comprising issued capital, reserves and retained earnings
as disclosed in the Consolidated Statement of Changes in
Equity.
The Group's Board reviews the capital structure on an on-going
basis. As part of this review, the Board considers the cost of
capital and the risks associated with each class of capital. The
Group seeks a conservative gearing ratio (the proportion of net
debt to equity). The Board is currently satisfied with the Group's
gearing ratio.
The gearing ratio at the year-end is as follows:
31 Dec 31 Dec
2022 2021
GBP'000 GBP'000
------------------------------- -------- --------
Borrowings (debt facility and
loan notes) (3,490) (3,428)
Cash and cash equivalents 3,632 5,608
--------------------------------- -------- --------
Net Cash 142 2,180
Total equity 6,959 3,747
Net cash to equity ratio -2% -58%
--------------------------------- -------- --------
The Group's gearing ratio has changed due to a reduced cash
balance resulting from operational cash outflows and an increase in
equity due to an equity fundraise in the year.
Financial instruments by category
31 Dec 31 Dec
2022 2021
GBP'000 GBP'000
-------------------------------------------------- ------ -------- --------
Categories of financial assets and liabilities
Financial assets - measured at amortised
cost
Trade and other receivables 10,083 3,566
Cash and cash equivalents 3,632 5,608
Financial liabilities - other financial
liabilities at amortised cost
Trade and other payables (6,046) (4,383)
Borrowings (3,490) (3,428)
Lease liabilities (1,027) (1,166)
Financial liabilities - other financial
liabilities at fair value
Contingent consideration payable (3,139) -
The fair values of the Group's cash and short-term deposits and
those of other financial assets equate to their carrying amounts.
The Group's receivables and cash and cash equivalents are all
classified as financial assets and carried at amortised cost. The
amounts are presented net of provisions for doubtful receivables
and allowances for impairment are made where appropriate. Trade and
other payables and loan borrowings are all classified as financial
liabilities measured at amortised cost.
The contingent consideration payable is measured at fair value,
using level 3 inputs in the calculation of fair value. The
contingent consideration is made up of two parts. The larger
portion of the consideration is fair valued using a Monte Carlo
simulation where the EBIT of each of the three years is an
independent, normally distributed random variable. An EBIT of
GBP1.2m has been used for year one with a 5% increase in each of
years 2 and 3. Values have been calculated for all three years and
in total and the average represents the fair value. As this is
based on estimated EBIT the actual amount may be different. The
smaller part of the contingent consideration relates to a
performance bond that is owed to The Edge. All contingent
consideration has been discounted using a discount rate of
9.2%.
A GBP100k increase in EBIT in each of the three years could
increase the contingent consideration payable by GBP113k, and a
GBP100k decrease in EBIT in each of the three years could decrease
the contingent consideration payable by GBP126k.
21) DEFERRED TAX
Deferred tax is calculated in full on temporary differences
under the liability method using a tax rate of 25% (2021:19%) for
UK differences. The movements in deferred tax assets and
liabilities during the year are shown below.
Deferred Deferred
Tax Asset Tax Liability Net Position
GBP'000 GBP'000 GBP'000
Recognised on intangible assets - (190) (190)
--------------------------------- ----------- --------------- -------------
At 31 December 2021 - (190) (190)
--------------------------------- ----------- --------------- -------------
Recognised on intangible assets - (801) (801)
Recognised on current period
amortisation 164 - 164
Recognised on tax losses 827 - 827
At 31 December 2022 991 (991) -
--------------------------------- ----------- --------------- -------------
Deferred tax assets estimated at GBP4.2 million (2021: GBP4.8
million) in respect of losses carried forward have not been
recognised due to uncertainties as to when income will arise
against which such losses will be utilised.
22) PROVISIONS
31 Dec 31 Dec
2022 2021
GBP'000 GBP'000
------------ -------- --------
Provisions 242 250
------------ -------- --------
Movement in provisions
GBP'000
At 31 December 2021 250
----------------------------------------- --------
Net decrease in provision in the year (8)
At 31 December 2022 242
----------------------------------------- --------
Provisions comprise dilapidation provisions relating to
properties. The associated forecast cash outflows are GBP0.1m in
2023 and GBP0.1m in 2025. The movement in the provision in the year
comprises a GBP0.05m cash outflow and an additional GBP0.04m
provision in relation to The Edge.
23) BUSINESS COMBINATIONS
The Edge Picture Co Limited
In August 2022, the Company acquired the entire issued share
capital of The Edge Picture Co Limited ("The Edge").
The consideration comprised initial consideration of GBP1.24m in
cash and GBP0.54 million paid in shares and deferred consideration
of up to a further GBP3.875m. The deferred consideration will be
satisfied by (i) cash and (ii) a combination of cash, the issue of
shares and/or the issue of loan notes in Zinc (in each case at
Zinc's sole discretion) contingent on the trading performance of
The Edge over each of the 12 month periods ending 30 June 2023, 30
June 2024 and 30 June 2025. An additional amount of deferred
consideration up to an approximate amount of GBP0.8m may become
payable in cash following The Edge receiving the same amount under
an existing financial arrangement and is not considered an
additional cost to Zinc.
The acquisition was funded by the share placing of 5,037,059 new
ordinary shares at GBP1 per share with certain of the Company's
shareholders and new investors. The placing raised gross proceeds
for the Company of GBP5.037m. Issue costs of GBP0.27m which were
directly attributable to the issue of the shares have been netted
against the deemed proceeds.
The Edge's full year trading performance resulted in GBP13m of
revenue and GBP1.3m of profit before tax, of which GBP5.8m of
revenue and GBP0.7m of profit before tax has been included in the
Group's consolidated results.
The fair value of the assets acquired and liabilities assumed
were as follows:
Fair Value
GBP'000
-------------------------------------- -----------
Property, plant and equipment 193
Right of use assets 433
Trade and other receivables 4,000
Work in progress 38
Cash and cash equivalents 913
Trade and other payables (3,743)
Lease liabilities (371)
Current tax liabilities (145)
Deferred tax (43)
Net assets acquired 1,275
-------------------------------------- -----------
Brand capitalised 1,464
Order book capitalised 119
Customer relations capitalised 1,450
Deferred tax liability on intangible
assets (758)
Goodwill capitalised 1,503
Consideration 5,053
-------------------------------------- -----------
Satisfied by:
Issue of shares 540
Cash 1,237
Deferred contingent consideration 3,276
5,053
-------------------------------------- -----------
The acquisition of The Edge forms part of the Group's growth
strategy. The acquisition resulted in a goodwill value of GBP1.5m
of which GBPnil is tax deductible.
24) SHARE CAPITAL AND RESERVES
31 Dec 22 31 Dec 21
Ordinary shares with a nominal value of: 0.125p 0.125p
Authorised:
Number Unlimited Unlimited
Issued and fully paid:
Number 21,806,834 16,200,919
Nominal value (GBP'000) 27 20
Fully paid ordinary shares carry one vote per share and carry
the right to dividends.
The movements in share capital and reserves in the year are made
up as follows:
31 Dec 2022 31 Dec 2021
Number of Share Share Merger Number of Share Share Merger
Shares Capital Premium Reserve Shares Capital Premium Reserve
Ordinary
shares GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At start of
year 16,200,919 20 4,785 27 15,963,039 20 4,654 27
Share placing
and
subscription
for cash 5,037,059 6 5,031 - - - - -
Expenses of
issue of
shares - - (270) - - - - -
Consideration
paid in
shares 540,000 1 - 539 - - - -
Shares issued
in lieu of
fees 28,856 - - - 237,880 0.3 131 -
At end of year 21,806,834 27 9,546 566 16,200,919 20 4,785 27
--------------- ----------- ----------- ----------- --------- ----------- ----------- ------------ ---------
Share Placing
In August 2022 the company raised GBP5.04m (before expenses)
through a placing of 5,037,059 new ordinary shares at GBP1 per
share.
Consideration paid in shares
On the 23rd of August 2022, the company issued 540,000 new
ordinary shares as part of the consideration for the acquisition of
The Edge.
Shares issued in lieu of fees
On the 11 June 2022 the Group issued 28,856 new ordinary shares
at a price of GBP1.04 per share to a Director in lieu of payment of
director fees.
Nature and purpose of the individual reserves
Below is a description of the nature and purpose of the
individual reserves:
-- Share capital represents the nominal value of shares issued;
-- Share premium includes the amounts over the nominal value in
respect of share issues. In addition, costs in respect of share
issues are debited to this account;
-- Merger reserve is used where more than 90 per cent of the
shares in a subsidiary are acquired and the consideration includes
the issue of new shares by the Company, which attract merger relief
under the Companies Act 1985 and, from 1 October 2009, the
Companies Act 2006;
-- Share based payment reserve arises on recognition of the
share-based payment charge in accordance with IFRS2 'Share Based
Payment Transactions'; and
-- Retained earnings include the realised gains and losses made by the Group and the Company .
25) RELATED PARTY TRANSACTIONS
Herald Investment Trust plc and John Booth Charitable
Foundation
The Company is the borrower of unsecured debt and loan notes
with Herald Investment Trust plc and John Booth Charitable
Foundation requiring a bullet repayment on 31 December 2024. The
total amount outstanding at 31 December 2022 including accrued
interest is GBP3.5m (2021: GBP3.4m). Interest accrued on the debt
amounted to GBP0.1m (2021: GBP0.0m).
26) POST BALANCE SHEET EVENTS
There are no post balance sheet events to disclose.
27) GUARANTEE IN RELATION TO SUBSIDIARY AUDIT EXEMPTION
On 19 April 2023, the Directors of the Company provided
guarantees in respect of its trading subsidiary companies in
accordance with section 479C of the Companies Act 2006. As a
result, the following subsidiary entities of the Company are exempt
from the requirements of the Companies Act 2006 relating to the
audit of accounts under section 479A of the Companies Act 2006:
Blakeway Productions Limited (02908076)
Zinc Television London Limited (02800925)
Zinc Communicate CSR Limited (06271341)
Films of Record Limited (01446899)
Reef Television Limited (03500852)
Zinc Television Regions Limited (02888301)
Tern Television Productions Limited (SC109131)
Cautionary note regarding forward-looking statements
This press release may contain certain forward-looking
information. The words "expect", "anticipate", believe",
"estimate", "may", "will", "should", "intend", "forecast", "plan",
and similar expressions are used to identify forward looking
information.
The forward-looking statements contained in this press release
are based on management's beliefs, estimates and opinions on the
date the statements are made in light of management's experience,
current conditions and expected future development in the areas in
which the Company is currently active and other factors management
believes are appropriate in the circumstances. The Company
undertakes no obligation to update publicly or revise any
forward-looking statements or information, whether as a result of
new information, future events or otherwise, unless required by
applicable law.
Readers are cautioned not to place undue reliance on
forward-looking information. By their nature, forward-looking
statements are subject to numerous assumptions, risks and
uncertainties that contribute to the possibility that the predicted
outcome will not occur, including some of which are beyond the
Company's control. There can be no assurance that forward-looking
statements will prove to be accurate as actual results and future
events could vary or differ materially from those anticipated in
such statements.
Inside Information
The information contained within this announcement constitutes
inside information for the purposes of Article 7 of the Market
Abuse Regulation (EU) no. 596/2014 as it forms part of UK domestic
law by virtue of the European Union (Withdrawal) Act 2018 ("MAR")
and is disclosed in accordance with the Company's obligations under
Article 17 of MAR. On the publication of this announcement via a
Regulatory Information Service, this inside information is now
considered to be in the public domain.
[1] Adjusted EBITDA is defined as EBITDA before Adjusting Items
(see Note 8) comprising share based payment charges, loss on
disposal of fixed assets, reorganisation and restructuring costs,
acquisition costs and contingent consideration treated as
remuneration
2 Pro-forma revenues demonstrate performance had The Edge been
owned by the Group for the whole of FY22
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
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END
FR UVRRROUUSUUR
(END) Dow Jones Newswires
April 26, 2023 02:00 ET (06:00 GMT)
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