TIDMMRM
RNS Number : 9558F
Metrodome Group PLC
31 May 2013
30 May 2013
Metrodome Group Plc
("Metrodome" or the "Company")
Preliminary Results for the year to 31 December 2012
Metrodome is pleased to announce its preliminary results for the
year ended 31 December 2012.
Financial highlights
-- Revenue down 9% to GBP8.2 million (2011: GBP9.0 million)
-- Underlying EBITDA* of GBP93,000 (2011: GBP656,000)
-- New loan funding of GBP750k in January 2013
*Underlying EBITDA consists of earnings from continuing
operations before exceptional items, interest, tax, depreciation,
amortisation of software costs and amortisation of acquired
intangible assets.
Operational highlights
-- Target Entertainment Ltd placed into administration in February 2012
-- Oscar nomination for "In Darkness" in February 2012
-- Oscar nomination for "A Royal Affair" in February 2013
-- HMV in administration in January 2013
Strategic highlights
-- The board announces its intention to delist the company from AIM
Mark Webster, Executive Chairman of Metrodome, commented:
"We have seen a shakeout in the film distribution industry with
the recent difficulties of some of our main competitors. The Group
is in a good position to capitalise in the marketplace and well
positioned for organic growth. This will be achieved by continuing
to acquire and/or produce good quality content for UK distribution
and the acquisition and representation of classic film libraries
across all platforms including the emerging digital platforms which
will be a catalyst for growth. It is the Board's belief that the
next stage of the Company's growth can be best effected as a
private company. "
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
Chairman's Statement
Metrodome is pleased to present its results for the year ended
31 December 2012.
Metrodome is 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. As a business we excel in creating bespoke,
cost effective release strategies to maximise returns for all
stakeholders. We pride ourselves on our 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.
Operating performance
The continuing businesses of UK film distribution and worldwide
sales agency were profitable for the year at the underlying EBITDA
level (note 3), despite the loss of sales to HMV and Blockbuster
which went into administration in January 2013.
Metrodome released 7 theatrical titles to cinemas in 2012 plus
22 one-print releases to launch the DVD. The highlights included In
Darkness, the Oscar nominated World War 2 story about Jewish
refugees, A Royal Affair, the Oscar nominated 18(th) century
historical drama and Room 237, the documentary exploring the hidden
meanings in Stanley Kubrick's film The Shining.
The Group released 57 DVD titles during the year, including:
-- Grave Encounters (horror)
-- Innkeepers (horror)
-- St Georges Day (British crime thriller)
HMV went into administration in January 2013 which had a serious
impact on our Q4 revenue. DVD sales were reduced by GBP213,000.
A full breakdown of the Group's total revenue is as follows:
Year ended % of Year ended % of Growth
31 Dec 12 Revenue 31 Dec 11 Revenue Year on Year
Revenue GBP'000 % GBP'000 % %
Cinema Sales 604 7.4% 348 3.9% 73.6%
Television Sales 550 6.7% 434 4.8% 26.7%
Video on Demand 1,043 12.7% 1,110 12.4% (6.0)%
Other ancillary income 277 3.4% 77 0.9% 259.7%
DVD Rental 285 3.5% 344 3.8% (17.2)%
DVD Sell Through 5,436 66.3% 6,643 74.2% (18.2)%
8,195 100.0% 8,956 100.0% (8.5)%
========== ======== ==================== ======== =============
Total revenues of GBP8,195,000 were 8.5% lower than the same
period last year (2011: GBP8,956,000), mainly due to the loss of
sales to HMV.
We announced our expansion into production with a slate of films
through our subsidiary Cinedome Ltd. Five projects are at various
stages of development and production. The film library includes
GBP103,000 incurred during the year on the first feature via a new
subsidiary: Devil Lies Beneath Ltd. Borderlands is an innovative
horror feature which will be released in the UK in 2013.
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.
Hollywood Classics moved into the Edgware Road office in
February 2012 which will ultimately achieve significant cost
savings by reducing overheads.
We carried out a review of operating costs at the end of the
year which resulted in 4 redundancies in early 2013.
Discontinuation of Target Entertainment Ltd ("Target")
The acquisition of Target fulfilled a strategic aim to diversify
into worldwide TV distribution to complement our existing film
distribution business. Unfortunately this objective proved to be
unsuccessful due to a number of factors, including the
underperformance in sales of key programmes and the loss of key
producers post acquisition. Target was placed into administration
on 28 February 2012 because it had accumulated losses and needed
significant funding to meet its current liabilities and acquisition
of new programming in order to return to profitability. Metrodome
decided it was not in the best interests of the Company to provide
this level of continued support for its loss-making subsidiary. It
was a difficult but necessary decision in order to safeguard the
future of the remaining profitable trading divisions of the Group.
Metrodome was owed GBP2.8m when the joint administrators were
appointed.
Under applicable accounting standards we were required to impair
the assets in 2011 and remove the liabilities from the
consolidation in 2012, which resulted in a profit from discontinued
operations for the year of GBP5,196,000 (2011: loss of
GBP8,733,000).
Funding
On 23 January 2013 the company raised GBP750,000 from Metrodome
BV, a 7.13% shareholder of the Company which is ultimately
controlled by the same entity which owns a majority investment of
Alerria Management Company SA, a 34.7% shareholder of the Company.
The loan shall be used to supplement working capital requirements
and acquire new content.
Board changes
On 30 September 2012 Steve Winetroube resigned from his role as
Chief Operating Officer for the Group.
Delisting
The board has carefully reviewed the costs and benefits of being
on AIM and decided it is in the best interests of all shareholders
and the company to cancel ("Cancellation") its listing on AIM. The
Board has given careful attention to the merits of maintaining its
listing on AIM against the current backdrop of a lack of liquidity
in the trading of the ordinary shares, the challenges and
likelihood of raising equity finance and the annual cost of
maintaining the listing. This was a difficult but necessary
decision. We can no longer justify the expense when we see little
prospect of raising funding in the near future. The Board will make
provision for shareholders to continue to trade their shares after
the Cancellation. The AIM Rules require that shareholders approve
the Cancellation. Further information surrounding the Cancellation
proposals will be circulated to shareholders in the Annual Report
to be dispatched in due course with the resolution to be included
at the next AGM which is anticipated to take place on 25 June
2013.
Outlook
We have seen a shakeout in the film distribution industry with
the recent difficulties of some of our main competitors. The Group
is in a good position to capitalise in the marketplace and well
positioned for organic growth. This will be achieved by continuing
to acquire and/or produce good quality content for UK distribution
and the acquisition and representation of classic film libraries
across all platforms including the emerging digital platforms which
will be a catalyst for growth. It is the Board's belief that the
next stage of the Company's growth can be best effected as a
private company.
Mark Webster
Chairman
30 May 2013
Consolidated Income Statement
For the year ended 31 December 2012
31 December 31 December
2012 2011
Continuing operations Notes GBP'000 GBP'000
Revenue 8,195 8,956
Cost of sales (5,056) (5,797)
Gross profit 3,139 3,159
Operating expenses (3,859) (2,562)
Operating (loss) / profit (720) 597
Analysed as:
Underlying EBITDA 3 93 656
Exceptional items 6 (34) 140
Depreciation and amortisation of
software costs (64) (64)
Amortisation and impairment of acquired
intangibles (715) (135)
--------------------------------------------- ------- ------------ ------------
(720) 597
--------------------------------------------- ------- ------------ ------------
Investment income - 7
Finance costs (151) (192)
--------------------------------------------- ------- ------------ ------------
(Loss)/profit before income tax expense (871) 412
Income tax credit 7 112 -
--------------------------------------------- ------- ------------ ------------
(Loss)/profit for the year from continuing
operations (759) 412
--------------------------------------------- ------- ------------ ------------
Profit/(loss) for the year from discontinued
operations 5,196 (8,733)
--------------------------------------------- ------- ------------ ------------
Profit/(loss) for the year 4,437 (8,321)
--------------------------------------------- ------- ------------ ------------
Attributable to
Equity holders of the parent 4,437 (8,309)
Non-controlling interest - (12)
--------------------------------------------- ------- ------------ ------------
Profit/(loss) for the year 4,437 (8,321)
--------------------------------------------- ------- ------------ ------------
Earnings / (loss) per share
Basic and diluted 4 1.6p (3.8)p
(Loss) / earnings per share from
continuing operations
Basic and diluted 4 (0.3)p 0.2p
Earnings / (loss) per share from
discontinued operations
Basic and diluted 4 1.9p (4.0)p
Consolidated Statement of Comprehensive
Income
For the year ended 31 December 2012
31 December 31 December
2012 2011
GBP'000 GBP'000
Profit / (loss) for the year 4,437 (8,321)
Other comprehensive income net of
tax:
Exchange differences arising on translation 13 (18)
--------------------------------------------- ------- ------------ ------------
Other comprehensive income for the
year 13 (18)
Total comprehensive income for the
year 4,450 (8,339)
--------------------------------------------- ------- ------------ ------------
Attributable to:
Equity holders of parent
* continuing operations (746) 394
* discontinued operations 5,196 (8,721)
Non-controlling interest
* discontinued operations - (12)
--------------------------------------------- ------- ------------ ------------
Total comprehensive income for the
year 4,450 (8,339)
--------------------------------------------- ------- ------------ ------------
Consolidated Statement of Financial Position
As at 31 December 2012
2012 2011
Notes GBP'000 GBP'000
Non current assets
Property, plant and equipment 152 171
Intangible assets 38 16
Film distribution library 4,294 3,502
Producer relationships 1,474 2,189
Trade and other receivables 123 330
---------------------------------- ----- ------- --------
6,081 6,208
---------------------------------- ----- ------- --------
Current assets
Inventories 105 85
Trade and other receivables 3,803 9,314
Income tax recoverable 29 -
Cash and cash equivalents 29 710
3,966 10,109
---------------------------------- ----- ------- --------
Total assets 10,047 16,317
---------------------------------- ----- ------- --------
Current liabilities
Trade and other payables (6,815) (17,277)
Current income tax liabilities - (272)
Borrowings 9 (2,558) (2,061)
---------------------------------- ----- ------- --------
(9,373) (19,610)
---------------------------------- ----- ------- --------
Non current liabilities
Trade and other payables (46) (171)
Deferred income tax liabilities (230) (342)
Borrowings 9 (237) (588)
---------------------------------- ----- ------- --------
(513) (1,101)
---------------------------------- ----- ------- --------
Total liabilities (9,886) (20,711)
---------------------------------- ----- ------- --------
Net assets / (liabilities) 161 (4,394)
---------------------------------- ----- ------- --------
Equity
Share capital 2,806 2,806
Share premium account 3,653 3,653
Share option reserve 41 37
Equity reserve 160 160
Translation reserve (6) (19)
Accumulated losses (6,493) (10,930)
---------------------------------- ----- ------- --------
Capital and reserves attributable
to equity holders of the parent 161 (4,293)
Non-controlling interest - (101)
---------------------------------- ----- ------- --------
Total equity 161 (4,394)
---------------------------------- ----- ------- --------
Consolidated Statement of Changes in Equity
For the year ended 31 December 2012
Share Share Share Non-
capital premium option Equity Translation Accumulated Sub-Total Controlling Total
account reserve reserve reserve losses Interest equity
Notes GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 January 2011 1,847 2,890 47 270 (1) (2,723) 2,330 (89) 2,241
------------------------- ---------------------------------- ---------------------------------- ---------------------------------- ------------------------------- ------------- ------------------------------- ----------- ------------------------------- --------
Loss for the year - - - - - (8,309) (8,309) (12) (8,321)
Exchange differences
arising
on translation of
overseas
operations - - - - (18) - (18) - (18)
------------------------- ---------------------------------- ---------------------------------- ---------------------------------- ------------------------------- ------------- ------------------------------- ----------- ------------------------------- --------
Total comprehensive
income
for the year - - - - (18) (8,309) (8,327) (12) (8,339)
------------------------- ---------------------------------- ---------------------------------- ---------------------------------- ------------------------------- ------------- ------------------------------- ----------- ------------------------------- --------
Transactions
with owners
Net proceeds from
ordinary
shares issued (net of
issue
costs) 559 463 - - - - 1,022 - 1,022
Loan notes converted to
equity 400 300 - (110) - 76 666 - 666
------------------------- ---------------------------------- ---------------------------------- ---------------------------------- ------------------------------- ------------- ------------------------------- ----------- ------------------------------- --------
Share options
forfeited during
the year - - (26) - - 26 - - -
Share based payment
charge
for the year - - 16 - - - 16 - 16
------------------------- ---------------------------------- ---------------------------------- ---------------------------------- ------------------------------- ------------- ------------------------------- ----------- ------------------------------- --------
Transactions with owners 959 763 (10) (110) - 102 1,704 - 1,704
------------------------- ---------------------------------- ---------------------------------- ---------------------------------- ------------------------------- ------------- ------------------------------- ----------- ------------------------------- --------
At 31 December 2011 2,806 3,653 37 160 (19) (10,930) (4,293) (101) (4,394)
------------------------- ---------------------------------- ---------------------------------- ---------------------------------- ------------------------------- ------------- ------------------------------- ----------- ------------------------------- --------
Consolidated Statement of Changes in Equity
For the year ended 31 December 2012
Share Share Non-
Share premium option Equity Translation Accumulated Sub-Total Controlling Total
capital account reserve reserve reserve losses Interest equity
Notes GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 January 2012 2,806 3,653 37 160 (19) (10,930) (4,293) (101) (4,394)
------------------------- ------------------------------- ---------------------------------- ---------------------------------- ------------------------------- ------------ ------------------------------- ---------- ------------------------------- --------
Profit for the year - - - - - 4,437 4,437 - 4,437
Exchange differences
arising on translation
of overseas operations - - - - 13 - 13 - 13
------------------------- ------------------------------- ---------------------------------- ---------------------------------- ------------------------------- ------------ ------------------------------- ---------- ------------------------------- --------
Total comprehensive
income for the year - - - - 13 4,437 4,450 - 4,450
------------------------- ------------------------------- ---------------------------------- ---------------------------------- ------------------------------- ------------ ------------------------------- ---------- ------------------------------- --------
Transactions
with owners
Share based payment
charge for the year - - 4 - - - 4 - 4
Non controlling
interest
of discontinued
operation - - - - - - - 101 101
------------------------- ------------------------------- ---------------------------------- ---------------------------------- ------------------------------- ------------ ------------------------------- ---------- ------------------------------- --------
Transactions with owners - - 4 - - - 4 101 105
------------------------- ------------------------------- ---------------------------------- ---------------------------------- ------------------------------- ------------ ------------------------------- ---------- ------------------------------- --------
At 31 December 2012 2,806 3,653 41 160 (6) (6,493) 161 - 161
------------------------- ------------------------------- ---------------------------------- ---------------------------------- ------------------------------- ------------ ------------------------------- ---------- ------------------------------- --------
Consolidated Statement of Cash Flows
For the Year ended 31 December 2012
Year ended Year ended
31 December 31 December
2012 2011
Notes GBP'000 GBP'000
Net cash generated from operating activities 10 3,837 4,809
Net cash used in investing activities 11 (4,629) (6,330)
Net cash (used in) / generated from financing
activities 12 (194) 1,467
Net decrease in cash and cash equivalents (986) (54)
Cash and cash equivalents at beginning
of year 710 764
Cash and cash equivalents at end of year (276) 710
---------------------------------------------- ----- ----------- -----------
Notes to the Preliminary announcement
For the year ended 31 December 2012
1. Preparation of the accounts
The 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.
Going concern
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.
There is uncertainty over future revenues since HMV and
Blockbuster went into administration in January 2013. The company
continued to trade with the administrators and is trading with the
new owners of HMV on a consignment basis, whereby Metrodome only
records a sale when it has been made over the counter to the end
consumer, which minimises the risk of bad debt. The company
experienced a similar shake up in the market when EUK ceased
trading in 2008. The directors are confident that consumers will
find a way to consume our product in the absence of HMV, provided
we expand into alternative retail outlets and continue our
expansion into online and video on demand platforms.
The company was technically in breach of certain loan covenants
at the year end and so the bank could have recalled their loan. The
conditions of the bank loan were successfully renegotiated in April
2013 and the loan repayments over the remaining term are
unchanged.
The directors monitor the success and failure of the company's
main competitors. Whilst the directors have noted the failure of
close competitors such as Revolver Entertainment Ltd, which went
into administration in April 2013, the directors see the potential
opportunity to acquire new films and increase market share as a
result.
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.
The following factors are taken into consideration during the
going concern assessment:
1) Overdraft at the end of the financial year of GBP276,000 (2011: GBP710,000 cash at bank)
2) Cash balance at the end of April 2013 of GBP268,000 and cash generated during May 2013,
3) The Group's bank overdraft facility of GBP500,000 which has a
temporary uplift of GBP250,000 to GBP750,000 for 6 months from June
to November 2013,
4) Detailed forecasts prepared which contain cash flow
projections by title, based on consistent and reliable assumptions
for income recognition and the timing of cash flows,
5) The quantity and quality of films scheduled for release in
the next twelve months and the acquisition strategy to fill in the
gaps in the schedule,
6) The Group's reduced reliance on key customers due to an
increase in the number of customers and use of credit
insurance,
7) The Group's dependence on key suppliers which has ensured
contingency plans are put in place to ensure business
continuity,
8) The extension of loan facilities and the agreement to extend the convertible loan notes
9) Loan covenant forecasts and the ongoing support of 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 and the ongoing support of major
shareholders, 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.
Preliminary announcement
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 2011 and the
same accounting policies adopted in the financial statements of the
Group for the year ended 31 December 2012.
The financial information in this preliminary announcement does
not constitute statutory accounts within the meaning of section 434
of the Companies Act 2006 but has been derived from statutory
accounts for the year ended 31 December 2012 which will be
delivered to the Registrar of Companies in due course. 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. Statutory accounts for the year ended 31
December 2011 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. Operating segments
IFRS 8 Operating Segments 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 2012
whose reports were reviewed by the Board in order to allocate
resources and assess performance. The first operating segment is
based on its original business activity of UK film distribution.
The second segment, Hollywood Classics, an international sales
agency, reflects Hollywood Classics Limited, a 100% owned
subsidiary acquired on 11 August 2011 and whose results have been
included in the consolidated financial statements. In 2011 there
were three operating segments: film distribution, Hollywood
Classics and TV distribution. The TV distribution segment reflected
Target Entertainment Limited (and its subsidiaries), a 100% owned
subsidiary discontinued on 28 February 2012 when Target was placed
into administration. Pricing of transactions between operating
segments is determined on an arm's length basis.
Operating segments
Year ended 31 December 2012 Metrodome Hollywood Corporate
Distribution Classics Costs Total
Film Film
GBP'000 GBP'000 GBP'000 GBP'000
Segment revenue 6,872 1,323 - 8,195
-------------- ---------- ---------- ---------
Underlying EBITDA 3 71 19 93
Exceptional items - - (34) (34)
Depreciation (2) (3) (46) (51)
Amortisation of software costs - (7) (6) (13)
Amortisation of acquired intangibles - (597) - (597)
Impairment of acquired intangibles - (118) - (118)
Segment profit / (loss) 1 (654) (67) (720)
Finance costs (27) - (124) (151)
-------------- ---------- ---------- ---------
Loss before income tax expense (26) (654) (191) (871)
-------------- ---------- ---------- ---------
Segment assets 7,330 3,440 3,934 14,704
Elimination of intercompany balances (4,657)
---------
10,047
---------
Segment liabilities (9,306) (1,640) (3,597) (14,543)
Elimination of intercompany balances 4,657
(9,886)
---------
Amortisation of film distribution
library 3,371 - - 3,371
Impairment of film distribution
library 399 - - 399
Operating segments
Year ended 31 December 2011 Metrodome Hollywood Corporate Discontinued
Distribution Classics Costs Total operations Total
Film Film
(5 months)
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Segment revenue 8,243 713 - 8,956 7,819 16,775
-------------- ----------- ---------- --------- ------------- ---------
Underlying EBITDA 434 185 37 656 (436) 220
Exceptional items - 504 (364) 140 (7,001) (6,861)
Depreciation (2) (2) (49) (53) (12) (65)
Amortisation of software costs - (4) (7) (11) (9) (20)
Amortisation of acquired intangibles - (135) - (135) (1,128) (1,263)
Segment profit / (loss) 432 548 (383) 597 (8,586) (7,989)
Investment income 7 - - 7 - 7
Finance costs (71) - (121) (192) (75) (267)
-------------- ----------- ---------- --------- ------------- ---------
Profit / (loss) before income
tax expense 368 548 (504) 412 (8,661) (8,249)
-------------- ----------- ---------- --------- ------------- ---------
Segment assets 6,299 3,278 5,198 14,775 4,994 19,769
Elimination of intercompany balances (3,452)
---------
16,317
---------
Segment liabilities (8,209) (2,747) (2,776) (13,732) (13,254) (26,986)
Elimination of intercompany balances 3,452
Elimination of Target intercompany
balance 2,823
---------
(20,711)
---------
Amortisation of film & TV distribution
library 3,431 - - 3,431 1,452 4,883
Impairment of film & TV distribution
library 578 - - 578 3,513 4,091
3. Underlying EBITDA
Underlying EBITDA consists of earnings from continuing
operations before exceptional items, interest, tax, depreciation,
amortisation of software costs and amortisation of acquired
intangible assets.
4. Earnings / (loss) per share
2012 2011
GBP'000 GBP'000
Profit/(loss) for the purpose of basic
earnings per share 4,437 (8,309)
(Loss)/profit for the purpose of basic
earnings per share on continuing activities (759) 412
Profit/(loss) for the purpose of basic
earnings per share on discontinued activities 5,196 (8,721)
Number of shares
Weighted average number of ordinary shares
for the purposes of basic and diluted earnings/(loss)
per share 280,567,915 220,661,665
Basic and diluted earnings/(loss) per share 1.6p (3.8)p
Basic and diluted (loss)/earnings per share
on continuing activities (0.3)p 0.2p
Basic and diluted earnings/(loss) per share
on discontinued activities 1.9p (4.0)p
Basic and diluted earnings per share are the same in the current
year because at the year end the exercise price was greater than
the share price. Basic and diluted earnings per share are the same
in the prior year as the effect on the loss for the year would be
anti-dilutive.
5. Dividends
The directors are unable to recommend payment of a dividend
(2011: GBPnil).
6. Exceptional items
The Group has separately identified costs and revenue of an
exceptional nature which are considered to be outside the normal
course of business due to their one-off nature or size.
2012 2011
GBP'000 GBP'000
Bargain purchase - (504)
Legal and professional fees - 325
Staff re-organisation 34 -
Office move - 39
34 (140)
----------------------------- -------- --------
Staff reorganisation
The Group incurred GBP34,000 (2011: GBPnil) of redundancy
payments and termination costs in respect of the staff
re-organisation during the year.
7. Income tax expense
2012 2011
GBP'000 GBP'000
Current tax - charge for the year - 9
- adjustment in respect of prior periods - 63
------------------------------------------------------------ ---------- ---------
- 72
Discontinued operation - (72)
Deferred tax credit 112 -
112 -
----------------------------------------------------------------------- ---------
The deferred tax credit for the year is due to the amortisation
of the fair value of producer relationships.
8. 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 income
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.
9. Borrowings
2012 2011
GBP'000 GBP'000
The other borrowings are repayable
as follows:
Within one year 2,558 2,061
In the second year 170 248
Between two and five years 67 340
2,795 2,649
------------------------------------ -------- --------
Analysed as:
Convertible loan notes 1,118 1,115
Bank overdraft 305 -
Bank loans 511 807
Loan from a related party 441 503
Other loan 420 224
2,795 2,649
--------------------------- ------ ------
The convertible loan notes are unsecured, carry an interest rate
of 4% and have a maturity date of 31 August 2014. The maturity date
of the convertible loan notes was extended from 31 August 2012 in
July 2012 and extended from 31 August 2013 in April 2013.
The bank loan is in sterling, carries an interest rate of 4.5%
above Coutts bank base rate and is repayable over four years by
equal quarterly instalments. The bank loan is secured by a fixed
and floating charge over the assets of the Company and its trading
subsidiaries plus an unlimited inter-company composite guarantee.
The bank loan was converted from euros to sterling in September
2012. The bank loan is treated as repayable on demand as at 31
December 2012 because certain conditions of the loan were not met.
The loan agreement states bank interest should be covered 2 times
by EBITDA. Bank interest of GBP65,000 (note 14) was covered 0.9
times by EBITDA of GBP59,000. The loan agreement states
Shareholders Funds should not fall below GBP500,000 and the
Consolidated Statement of Financial Position shows GBP161,000. The
conditions of the bank loan have been renegotiated in April 2013
and the loan repayments over four years are unchanged.
The loan from a related party is in US dollars, is unsecured,
carries an interest rate of 4% and is repayable on 31 August 2014.
The repayment date was extended from 31 August 2012 in March 2012
and extended from 31 August 2013 in April 2013.
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.
10. Reconciliation of loss before income tax expense to net cash
from operating activities
Year ended Year ended
31-Dec-2012 31-Dec-2011
GBP'000 GBP'000
(Loss) / profit before income
tax expense (871) 412
Income taxes paid (115) -
Adjustments for:
Investment income - (7)
Finance costs 151 192
Gain on bargain purchase - (504)
Depreciation of property, plant
& equipment 51 53
Amortisation of intangible assets 13 11
Amortisation of film distribution
library 3,371 3,431
Impairment of film distribution
library 399 578
Amortisation of producer relationships 597 135
Impairment of producer relationships 118 -
Share based payment expense 4 16
Loss on disposal of property,
plant & equipment - 40
Increase in inventories (20) (32)
Decrease in receivables 197 1,752
Decrease in payables (664) (2,007)
--------------------------------------- ----------- -----------
Cash generated from continuing
operations 3,231 4,070
Cash generated from discontinued
operations 606 739
--------------------------------------- ----------- -----------
Net cash generated from operating
activities 3,837 4,809
--------------------------------------- ----------- -----------
11. Investing activities
Year ended Year ended
31-Dec-2012 31-Dec-2011
GBP'000 GBP'000
Purchases of film distribution
library (4,562) (4,186)
Purchases of property, plant
& equipment (32) (125)
Purchases of intangible assets (35) (14)
Acquisition of subsidiary, net
of cash acquired:
* Consideration paid - (1,620)
* Cash acquired - 1,357
-------------------------------------- ----------- -----------
Net cash used in investing activities
in continuing operations (4,629) (4,588)
Net cash used in investing activities
in discontinued operations - (1,742)
-------------------------------------- ----------- -----------
Net cash used in investing activities (4,629) (6,330)
-------------------------------------- ----------- -----------
12. Financing activities
Year ended Year ended
31-Dec-2012 31-Dec-2011
GBP'000 GBP'000
Proceeds from issue of ordinary share
capital - 1,022
Proceeds from new borrowings 607 831
Repayments of bank loan (188) (50)
Repayments of borrowings (383) (200)
Investment income - 7
Interest paid (151) (221)
----------------------------------------------- ----------- -----------
Net cash (used in) / generated from
financing activities in continuing operations (115) 1,389
Net cash (used in) / generated from
financing activities in discontinued
operations (79) 78
----------------------------------------------- ----------- -----------
Net cash (used in) / generated from
financing activities (194) 1,467
----------------------------------------------- ----------- -----------
This information is provided by RNS
The company news service from the London Stock Exchange
END
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