TIDMMRM
RNS Number : 3145G
Metrodome Group PLC
11 May 2011
11 May 2011
Metrodome Group Plc
("Metrodome" or the "Company")
Unaudited Preliminary Results for the year to 31 December
2010
Metrodome is pleased to announce its preliminary results for the
year ended 31 December 2010.
Financial highlights
-- Revenue up 53% to GBP13.90 million (2009: GBP9.10
million)
-- Headline* operating profit up 205% to GBP747,000 (2009:
GBP245,000)
-- GBP1.96 million cash raised through the issue of convertible
loan notes
*Headline operating profit / (loss) consists of revenues and
other operating income after deducting operating costs incurred in
the normal course of business excluding amortisation of acquired
intangibles and non-recurring items.
Operational highlights
-- Acquisition of Target Entertainment Ltd and its subsidiaries
("Target") for GBP800,000
-- Increased Coutts overdraft facility by GBP1.40 million
-- Oscar win for The Secret in Their Eyes in the Best Foreign
Language Film category in March 2010
Strategic highlights
-- Addition of 4,000 hours of television programming to Group's
library of content
-- Released 3 of the top 10 foreign language films in UK
-- Significant growth in Video on Demand ("VOD")
-- Signed non-exclusive deal with Apple's iTunes.
Mark Webster, Executive Chairman of Metrodome, commented:
"I am pleased to announce a strong set of results which
demonstrate Metrodome's development as a fully integrated rights
management and distribution business. I am pleased we have met our
strategic and performance objectives for 2010 and feel confident we
have a strong platform for growth in 2011. We were very pleased to
complete the acquisition of Target during the year which has given
us a global presence in TV distribution. We are actively seeking
further suitable acquisition opportunities in the sector."
For further information please visit www.metrodomegroup.com, or
contact:
Metrodome Group plc
Mark Webster / Deborah Brown Tel: 020 7535 7300
Charles Stanley Securities
Dugald J. Carlean / Karri Vuori Tel: 020 7953 6000
Tavistock Communications
John West / Lydia Eades Tel: 020 7920 3150
Chairman's Statement
The first half of 2010 was a period of significant change for
Metrodome in terms of staffing and strategic direction. We
announced a reduction in our theatrical distribution business with
a move towards a more commercially focused slate of theatrical
releases scaled in accordance with market conditions. We carefully
select titles for theatrical release, taking into consideration key
criteria such as genre and cast, in order to raise the profile of a
film in a cost effective way, prior to the DVD and VOD release. Our
remarkable success at the Box Office in 2010 has proved this to be
an appropriate strategy.
The second half of 2010 saw Metrodome take the next step in its
diversification into related activities. The acquisition of Target
Entertainment Ltd and its subsidiaries ("Target") added 4,000 hours
of television programming to the Group's expanding library of
content. We are now a fully integrated all rights distribution
business dedicated to maximising revenues for producers of film and
TV content.
These changes resulted in a number of redundancies during the
year which will generate significant cost savings going
forward.
Our stated objectives are to maintain profitability and expand
the Group. We have achieved our objectives for 2010 through a
headline* operating profit of GBP747,000 and the acquisition of
Target. We will continue on this path and focus on our core
business of film and TV distribution, as well as investing in
related activities such as co-production deals and further seeking
diversification in related markets via mergers and
acquisitions.
*Headline operating profit / (loss) consists of revenues and
other operating income after deducting operating costs incurred in
the normal course of business excluding amortisation of acquired
intangibles and non-recurring items.
Acquisition of Target Entertainment Ltd
On 13 August 2010, Metrodome acquired the entire share capital
of Target Entertainment Ltd. Founded in 1998, Target is a TV
distribution rights management business. It has a broad
international network and a substantial catalogue of rights across
a wide range of genres, including drama, documentary, comedy and
kids' entertainment.
Metrodome acquired Target Entertainment Ltd for GBP800,000,
which comprised GBP400,000 of available cash resources held by the
Company with the remaining GBP400,000 being provided by the issue
of 4% loan notes. A further GBP1,560,000 of loan notes were issued
to provide working capital for the enlarged Group. GBP1,100,000 of
these loan notes have been subscribed for by Mark Webster,
Executive Chairman of the Company.
We are delighted to have taken this first step in our
acquisition strategy designed to both strengthen our current
operations and broaden our range of activities.
The fair value of the assets and liabilities acquired is shown
in note 2 of the accounts, which generated goodwill on acquisition
of GBP3,413,000, following the translation of Target's results,
assets and liabilities to comply with Group accounting policies and
IFRS. The goodwill is attributable to operational synergies and
future earnings potential based on strong relationships with
producers and TV broadcasters globally.
We consider Target's TV distribution business to be a separate
operating segment to the existing film distribution business and
the board monitors the performance of the two businesses separately
as well as a whole. The results by segment are provided in note
3.
Operating performance
Metrodome released 5 theatrical titles to cinemas in 2010 plus
15 one-print releases to launch the DVD. The highlights in the
first half included I Am Love, starring Tilda Swinton, which was
nominated for a BAFTA in the 'Film Not In The English Language'
category, outperforming all expectations at the box office, and
Lebanon which won the Venice Film Festival's Golden Lion in 2009.
Key releases in the second half of the year were Leaving, starring
Kristen Scott Thomas who won Best Actress in the London Evening
Standard British Film Awards for her performance, and The Secret in
their Eyes which won an Oscar in 2010 for the best foreign language
film.
Our theatrical releases, in aggregate, grossed over GBP2.1
million (2009: GBP1.4 million) at the Box Office which we consider
to be an excellent result. Metrodome released three of the top 10
foreign language films in UK cinemas in 2010 (source: Rentrak). The
important lessons learned in previous years regarding the size of
release were applied to the theatrical release strategies in 2010
with profitable results.
The acquisition of Target has considerably reduced our reliance
on DVD. TV revenues contributed 35.1% of total revenues in 2010 as
Target sales were included from the date of acquisition; 91% of
total TV Sales in 2010 were due to Target.
We continue to see significant growth in Video on Demand
("VOD"). Our strategy remains unchanged as we sign non-exclusive
deals with all the major players including Apple's iTunes.
As predicted in recent years, we have seen our rental revenues
fall considerably in 2010.
After several years of significant growth in DVD we have
experienced a slight fall of 2.5% in DVD revenues this year. Given
the fierce competition in acquiring suitable product at an
affordable price and the difficulty selling into the retailers we
are pleased with the overall result generated by the steady
performance of several titles rather than a breakout result from
one or two. It was our reliance on such a competitive revenue
stream which guided us towards our overall diversification
strategy. We aim to release fewer direct-to-DVD titles in 2011 and
focus on improving margins.
The Group released 53 titles during the year, including:
-- Lebanon
-- Attack on Leningrad
-- The Bridge
-- Dragon Quest
-- Everyman's War
A full breakdown of the Group's total revenue is as follows:
Year ended % of Year ended % of Growth
31 Dec 10 Revenue 31 Dec 09 Revenue Year on Year
Revenue GBP'000 % GBP'000 % %
Cinema Sales 742 5.3% 395 4.3% 87.8%
Television Sales 4,871 35.1% 517 5.7% 842.2%
Video on Demand 1,089 7.9% 695 7.6% 56.7%
Other ancillary
income 72 0.5% 68 0.8% 5.9%
DVD Rental 296 2.1% 790 8.7% -62.5%
DVD Sell Through 6,460 46.6% 6,626 72.9% -2.5%
Consumer Products 346 2.5% - 0% 100%
---------- -------- ---------- -------- -------------
13,876 100.0% 9,091 100.0% 52.6%
========== ======== ========== ======== =============
Total revenues of GBP13,876,000 were 52.6% higher than the same
period last year (2009: GBP9,091,000) which is an excellent result
in the current marketplace.
The film distribution segment achieved annual revenues of
GBP8,798,000 (2009: GBP9,091,000), a drop of 3.2% year on year. In
contrast to prior years, there was no single title in 2010 to
contribute more than 10% of total revenue. Considering we had
steady performing titles across the catalogue the total revenue was
quite an achievement in the current economic climate.
Cost base
The Group is constantly reviewing its operating structure and
cost base in an attempt to improve operational effectiveness and
achieve efficiencies. We are regularly reviewing key contracts with
suppliers, with a view to maintaining high standards and further
cost reductions.
We moved out of our office in Leicester Square in March 2011
into Target's existing office in Edgware Road which has spare
capacity for additional staff as we expand. As such, we will
achieve significant cost savings by combining offices and reducing
overheads.
The redundancies in 2010 will result in reduced annual
employment costs in future.
The Group amortised GBP432,000 of the fair value of the TV
library on acquisition based on the revenues of the TV distribution
segment from acquisition to 31 December 2010.
Non recurring items
During 2010 Metrodome incurred GBP449,000 of legal and
professional fees in respect of a potential acquisition which was
aborted in early 2010 (2009: GBP45,000), the successful acquisition
of Target Entertainment Ltd, employment law advice and the issue of
loan notes.
The Group incurred GBP368,000 of redundancy payments and
termination costs in respect of the staff re-organisation in the
film distribution segment and GBP129,000 in the TV distribution
(Target) segment of the business.
Funding
In addition to the GBP1,960,000 raised from existing
shareholders by the issue of loan notes, the Company raised
$900,000 via an unsecured loan from Metrodome BV, a Dutch holding
and investment company, which is owned by Adrian Sarbu who owns
approximately 90% of Alerria Management SA ("Alerria"), Metrodome's
major shareholder. Alerria currently has a holding in Metrodome of
52.8%.
The Company also increased its Coutts Bank overdraft facility by
GBP1,000,000 to GBP1,400,000 in December 2010 to provide additional
working capital to the Group in 2011.
Board changes
Deborah Brown was appointed as Finance Director and Company
Secretary on 1(st) September 2010, replacing Steve Winetroube who
remains with the Company as a Non-Executive Director.
Outlook
Metrodome is now a fully integrated rights management and
distribution business which provides its industry expertise to
maximise revenues for producers of film and TV content across all
distribution platforms in the UK. As a business we excel in
creating bespoke, cost effective release strategies to maximise
returns for all stakeholders. We pride ourselves on our unrivalled
market knowledge and ability to adapt to our clients' needs in a
fast changing media landscape. We also pride ourselves on our
ability to provide the very best in marketing, press and sales,
delivering exceptional release campaigns for quality movies that
capture the imagination of audiences.
Metrodome's strategic objective is to diversify into related
activities and expand globally. Half of our business is DVD which
is arguably in decline. The future of the DVD industry depends on
the success of Blu-Ray and 3D as well as the emergence of VOD which
is currently restricted by broadband capability in the UK. The
potential risk of losing HMV as a key retailer is also an important
factor.
The success of our expansion into co-production will be
established in the first half of 2011 when we release Age of the
Dragons and Age of Heroes, our first two co-production deals. These
releases will determine how this strategy is pursued in future.
Early indications are very positive and we see co-production as an
ideal way of securing product for the home entertainment
market.
I am pleased we met our strategic and performance objectives for
2010 and feel confident we have a strong platform for growth in
2011. The acquisition of Target Entertainment Ltd was the first
acquisition in line with our corporate strategy. We are actively
seeking other suitable opportunities, concentrating on film and TV
distribution. Now we have a global presence with Target for TV
distribution we are also looking at international opportunities for
film distribution.
I would personally like to thank our talented staff for their
ongoing support and contribution to this year's success. I am
confident we can build value for our supportive shareholders in
2011 and beyond.
Mark Webster
Chairman
11 May 2011
Unaudited Consolidated Statement of Comprehensive Income
For the year ended 31 December 2010
Year ended Year ended
31-Dec-2010 31-Dec-2009
Notes (Unaudited) (Audited)
GBP'000 GBP'000
Revenue 13,876 9,091
Amortisation of acquired intangibles (432) -
Other cost of sales (9,850) (6,434)
----------- -----------
Cost of sales (10,282) (6,434)
----------- -----------
Headline gross profit 4 4,026 2,657
Amortisation of acquired intangibles (432) -
--------------------------------------- ----- ----------- -----------
Gross profit 3,594 2,657
Operating expenses (3,279) (2,412)
Headline operating profit 5 747 245
Amortisation of acquired intangibles (432) -
--------------------------------------- ----- ----------- -----------
Non recurring items 8 (946) (45)
(Loss) / profit on ordinary activities
before investment income, finance
costs and income tax expense (631) 200
Investment income 1 2
Finance costs (36) (3)
(Loss) / profit before income tax
expense (666) 199
Income tax expense 9 (14) -
--------------------------------------- ----- ----------- -----------
(Loss) / profit for the year (680) 199
--------------------------------------- ----- ----------- -----------
Total comprehensive income for the
year (680) 199
--------------------------------------- ----- ----------- -----------
Attributable to
Equity holders of parent (672) 199
Non-controlling interest (8) -
--------------------------------------- ----- ----------- -----------
(680) 199
--------------------------------------- ----- ----------- -----------
(Loss) / profit per share
Basic 6 (0.4)p 0.1p
Diluted 6 (0.4)p 0.1p
Unaudited Consolidated Statement of Financial Position
As at 31 December 2010
31-Dec-2010 31-Dec-2009
Notes (Unaudited) (Audited)
GBP'000 GBP'000
Non current assets
Property, plant and equipment 145 162
Intangible assets 20 11
Goodwill on acquisition 2 3,413 -
Film and TV distribution library 10 6,562 2,771
Trade and other receivables 669 73
---------------------------------- ----- ----------- -----------
10,809 3,017
---------------------------------- ----- ----------- -----------
Current assets
Inventories 53 90
Trade and other receivables 7,481 1,554
Cash and cash equivalents 764 1,578
8,298 3,222
---------------------------------- ----- ----------- -----------
Total assets 19,107 6,239
---------------------------------- ----- ----------- -----------
Current liabilities
Trade and other payables (13,883) (3,526)
Other borrowings 11 (183) -
---------------------------------- ----- ----------- -----------
(14,066) (3,526)
---------------------------------- ----- ----------- -----------
Non current liabilities
Trade and other payables (388) -
Other borrowings 11 (2,412) -
---------------------------------- ----- ----------- -----------
(2,800) -
---------------------------------- ----- ----------- -----------
Total liabilities (16,866) (3,526)
---------------------------------- ----- ----------- -----------
Net assets 2,241 2,713
---------------------------------- ----- ----------- -----------
Equity
Share capital 1,847 1,847
Share premium account 2,890 2,890
Share option reserve 47 181
Equity reserve 270 -
Translation reserve (1) -
Accumulated losses (2,723) (2,205)
---------------------------------- ----- ----------- -----------
Capital and reserves attributable
to owners of the company 2,330 2,713
Non-controlling interest (89) -
Total equity 2,241 2,713
---------------------------------- ----- ----------- -----------
Unaudited Consolidated Statement of Changes in Equity
For the year ended 31 December 2010
Share Share Non-
Share premium option Equity Translation Accumulated controlling Total
capital account reserve reserve Reserve Losses Interest Equity
(Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited)
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1
January 2009 1,207 2,581 128 - - (2,404) - 1,512
Profit for the
year - - - - - 199 - 199
------------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------
Total
comprehensive
income and
expense for the
year - - - - - 199 - 199
------------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------
Transactions
with owners Net
proceeds from
ordinary shares
issued 640 309 - - - - - 949
Share based
payment charge
for the year - - 53 - - - - 53
Transactions with
owners 640 309 53 - - - - 1,002
------------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------
Balance at 31
December 2009 1,847 2,890 181 - - (2,205) - 2,713
Loss for the
year - - - - - (672) (8) (680)
Equity component
of convertible
loan notes - - - 270 - - - 270
Exchange
differences
arising on
translation of
overseas
operations - - - - (1) - - (1)
------------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------
Total
comprehensive
income and
expense for the
year - - - 270 (1) (672) (8) (411)
------------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------
Transactions
with owners
Share options
forfeited
during the
year - - (154) - - 154 -
Non-controlling
interest on
acquisition of
subsidiaries - - - - - - (81) (81)
Share based
payment charge
for the year - - 20 - - - - 20
Transactions with
owners - - (134) - - 154 (81) (61)
------------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------
Balance at 31
December 2010 1,847 2,890 47 270 (1) (2,723) (89) 2,241
================== ============ ============ ============ ============ ============ ============ ============ ============
Unaudited Consolidated Statement of Cash Flows
For the Year ended 31 December 2010
Year ended Year ended
31-Dec-2010 31-Dec-2009
Notes (Unaudited) (Audited)
GBP'000 GBP'000
Net cash from operating activities 12 1,983 5,111
Net cash used in investing activities 13 (5,764) (4,656)
Net cash from financing activities 14 2,967 32
Net (decrease) / increase in cash and
cash equivalents (814) 487
Cash and cash equivalents at beginning
of year 1,578 1,091
Cash and cash equivalents at end of year 764 1,578
----------------------------------------- ----- ----------- -----------
Notes to the Preliminary announcement
For the year ended 31 December 2010
1. Preparation of the accounts
The unaudited preliminary announcement has been prepared under
the historical cost convention on a going concern basis and in
accordance with applicable International Financial Reporting
Standards and IFRIC interpretations ("IFRS") as adopted by the
EU.
The board carries out an assessment of whether the Group is a
going concern when preparing its annual and half-yearly financial
statements. This assessment takes into account the size, level of
financial risk and complexity of the Group and its operations. The
review covers a period of at least twelve months from the date of
approval of the financial statements.
The assessment is twofold: firstly to assess the minimum
requirements to continue as a going concern and secondly, to
identify the funding requirements for new acquisitions and make
plans to raise additional finance where necessary, for example from
major shareholders.
As a consequence of the Group's financial resources at the year
end and having considered the trading and cash flow forecasts for
the next twelve months, the directors believe that the Company and
the Group have adequate resources to continue to adopt the going
concern basis in preparing the annual report and accounts.
The preliminary announcement has been prepared on the basis of
the same accounting policies as published in the audited financial
statements of the Group for the year ended 31 December 2009.
The financial information in this preliminary announcement does
not constitute statutory accounts within the meaning of section 435
of the Companies Act 2006. Statutory accounts for the year ended 31
December 2010 have not yet been delivered to the Registrar of
Companies and no audit report has yet been given on the statutory
financial statements. Statutory accounts for the year ended 31
December 2009 have been delivered to the Registrar of Companies.
The audit report on these statutory accounts was unqualified and
did not contain a statement either under section 498(2) or 498(3)
of the Companies Act 2006.
The preliminary announcement is presented in pounds sterling
since that is the currency in which the majority of the Group's
transactions are denominated.
2. Acquisition
Business combinations are accounted for under the acquisition
method. There were no business combinations in 2009.
On 13 August 2010, Metrodome acquired the entire share capital
of Target Entertainment Ltd. Founded in 1998, Target is a TV
distribution rights management business. It has a broad
international network and a substantial catalogue of rights across
a wide range of genres, including drama, documentary, comedy and
kids' entertainment.
Metrodome acquired Target Entertainment Ltd for GBP800,000,
which comprised GBP400,000 provided from by the Company's resources
with the remaining GBP400,000 being provided by the issue of 4%
loan notes, convertible by the holder at 2 pence which equates to a
premium of 45% to the mid-market price on 13 August 2010. A further
GBP1,560,000 of loan notes have been issued on identical terms to
provide working capital for the enlarged Group. GBP1,100,000 of
these loan notes have been subscribed by Mark Webster, Executive
Chairman of the Company.
If the acquisition had occurred on 1 January 2010, the estimated
revenue for the Group for the year would have been GBP20,812,000
and loss before income tax expense GBP808,000.
The acquired net assets of Target Entertainment are set out
below:
Fair Value
Book Value Fair value to Metrodome
Before Acquisition adjustments Group plc
(Unaudited) (Unaudited) (Unaudited)
GBP'000 GBP'000 GBP'000
Property, plant and
equipment 18 - 18
Intangible assets 23 - 23
TV distribution library 379 3,250 3,629
Trade and other
receivables 4,108 - 4,108
Cash and cash
equivalents 138 - 138
Trade and other payables (10,610) - (10,610)
Net assets and
liabilities (5,944) 3,250 (2,694)
------------------------- -------------------- ------------- --------------
Non-controlling interest 81
Purchase consideration (800)
--------------
Goodwill on acquisition 3,413
--------------
In the period from acquisition to 31 December 2010, Target
Entertainment Ltd and its subsidiaries contributed GBP343,000 to
the consolidated headline operating profit of the Group.
The goodwill is attributed to the profitability of the acquired
business through its relationships with TV producers.
3. Business segments
IFRS 8 requires financial information to be reported on the same
basis as is used internally for evaluating operating segment
performance and deciding how to allocate resources to operating
segments.
An operating segment is a component of an entity:
a) that engages in business activities from which it may earn
revenues and incur expenses,
b) whose operating results are regularly reviewed by the
entity's chief operating decision maker to make decisions about
resources to be allocated to the segment and assess its
performance, and
c) for which discrete financial information is available.
In the opinion of the directors, the chief decision maker is the
Board of Metrodome Group plc and there were two segments in 2010
whose reports were reviewed by the Board in order to allocate
resources and assess performance.
The first operating segment is based on its existing business
activity of film distribution. The second segment, TV distribution,
reflects Target Entertainment Limited (and its subsidiaries), a
100% owned subsidiary acquired on 13th August 2010 and whose
results have been included in the consolidated financial
statements. In 2009 there was only one operating segment.
Year ended
Year ended 31 December
31 December 2010 2009
Film TV
Distribution Distribution Total
(Unaudited) (Unaudited) (Unaudited) (Audited)
GBP'000 GBP'000 GBP'000 GBP'000
Segment
revenue 8,798 5,078 13,876 9,091
Headline
operating
profit 486 343 829 329
Amortisation
of acquired
intangibles - (432) (432) -
Non recurring
items (368) (129) (497) -
--------------- --------------- ------------ -------------
Segment (loss)
/ profit 118 (218) (100) 329
Corporate
costs (531) (129)
Investment
income 1 2
Finance costs (36) (3)
------------ -------------
(Loss) /
profit before
income tax
expense (666) 199
------------ -------------
Segment assets 12,065 7,042 19,107 6,239
-------- --------- --------- --------
Segment liabilities (6,615) (10,251) (16,866) (3,526)
-------- --------- --------- --------
Depreciation 33 7 40 23
------ ---- ------ ------
Amortisation 3,678 562 4,240 3,780
------ ---- ------ ------
Additions to non current
assets* 8,360 155 8,515 5,269
------ ---- ------ ------
* Additions to non current assets include property, plant and
equipment, intangible assets, goodwill, film and TV library.
4. Headline gross profit
Headline gross profit consists of revenue less cost of sales
incurred within the normal course of business excluding
amortisation of acquired intangibles and non-recurring items.
5. Headline operating profit
Headline operating profit consists of revenues and other
operating income after deducting operating costs incurred within
the normal course of business excluding amortisation of acquired
intangibles and non-recurring items.
6. (Loss) / profit per share
The (loss) / profit per share is based on the consolidated loss
of GBP680,000 (2009: GBP199,000 profit) after taxation and the
weighted average number of shares in the year of 174,051,248 (31
December 2009: 174,051,248).
Basic and diluted earnings per share are the same because at the
year end the exercise price was greater than the share price.
7. Dividends
As in prior periods, the directors are not recommending payment
of a dividend.
8. Non recurring items
The Group has separately identified costs and revenue of a
non-recurring nature which are considered to be outside the normal
course of business due to their one-off nature or size.
31-Dec-2010 31-Dec-2009
(Unaudited) (Audited)
GBP'000 GBP'000
Legal & professional fees (449) (45)
Staff re-organisation (497) -
(946) (45)
--------------------------- ------------ ------------
Legal & professional fees
During 2010 Metrodome incurred GBP449,000 of legal and
professional fees in respect of a potential acquisition which was
aborted in early 2010 (2009: GBP45,000), the successful acquisition
of Target Entertainment Ltd, employment law advice and the issue of
loan notes.
Staff reorganisation
The Group incurred GBP368,000 of redundancy payments and
termination costs in respect of the staff re-organisation in the
film distribution segment and GBP129,000 in the Target segment of
the business.
9. Income tax expense
2010 2009
(Unaudited) (Audited)
GBP'000 GBP'000
Current tax (14) -
Deferred tax - -
(14) -
------------- ------------- -----------
Corporation tax is calculated at 27% (31 December 2009: 28%) of
the estimated assessable profit for the year.
10. Film and TV distribution library
Expenditure on the Group's film and TV distribution library is
carried forward and recognised as an asset when it is estimated
that sufficient future income will be earned to cover recoupment of
the costs. These costs are written off in line with actual revenue
flows calculated in accordance with licensor agreements.
The estimate of future income depends on management judgement
and assumptions based on the pattern of historical revenue streams
and the remaining life of each film or TV contract.
11. Other borrowings
31-Dec-2010 31-Dec-2009
(Unaudited) (Audited)
GBP'000 GBP'000
The other borrowings are repayable 183 -
as follows:
Within one year
In the second year 2,412 -
2,595 -
----------------------------------- ------------ ------------
Convertible loan notes 1,690 -
Loan from a related party 499 -
Other borrowing 406 -
2,595 -
-------------------------- ------
The convertible loan notes are unsecured, carry an interest rate
of 4% and have a maturity date of 31(st) August 2012.
The loan from a related party is in US dollars, carries an
interest rate of 4% and is repayable on 31(st) August 2012.
The other borrowing is unsecured, interest-free and repayable
over three years by equal monthly instalments.
Fair values have been calculated by discounting cash flows at
prevailing interest rates.
12. Reconciliation of profit before income tax expense to net
cash from operating activities
Year ended Year ended
31-Dec-2010 31-Dec-2009
(Unaudited) (Audited)
GBP'000 GBP'000
(Loss) / profit before income
tax expense (666) 199
Adjustments for:
Investment income (1) (2)
Finance costs 36 3
Depreciation of property, plant
& equipment 40 23
Amortisation of intangible assets 20 3
Exchange differences arising
on translation of overseas operations (1) -
Amortisation of film & TV distribution
library 4,220 3,777
Impairment of film & TV distribution
library 708 667
Share based payment expense 20 53
(Gain)/loss on disposal of property,
plant & equipment 1 6
(Increase) / decrease in inventories 38 (37)
(Increase) / decrease in receivables (2,416) 438
Decrease in payables (16) (19)
Net cash from operating activities 1,983 5,111
--------------------------------------- ----------- -----------
13. Investing activities
Purchases of film distribution
library (5,090) (4,485)
Purchases of property, plant
& equipment (6) (161)
Purchases of intangible assets (6) (10)
Purchase of subsidiary undertaking (800) -
Net cash acquired with subsidiary
undertaking 138
-------------------------------------- ------- -------
Net cash used in investing activities (5,764) (4,656)
-------------------------------------- ------- -------
14. Financing activities
Proceeds from issue of ordinary
share capital - 599
Issue of loan notes 1,960 -
Proceeds from new borrowings 1,175 689
Repayments of bank loan - (284)
Repayments of other borrowings (133) (971)
Investment income 1 2
Interest paid (36) (3)
Net cash from financing activities 2,967 32
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This information is provided by RNS
The company news service from the London Stock Exchange
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