LONDON (Alliance News) - Reach4entertainment enterprises PLC Wednesday reported a fall in pretax profit for the first half of 2015 as the theatre market returned to a more "normal" level after an "exceptional" 2014, and said it is trading in line with its expectations for the full year.
Reach4entertainment provides advertising, marketing and other services for the theatrical, film and live entertainment industries.
For the half year to end-June the company posted a pretax profit of GBP52,000, down from GBP709,000 a year before, as a rise in revenue to GBP42.5 million from GBP41.5 million was offset by a rise in administrative costs, and exceptional costs of GBP264,000 related to one-off property expenses, redundancy costs and charges associated to the company's refinancing.
Reach4entertainment said the growth in revenue came from higher advertising spend from US related theatre shows.
The company has inked a conditional agreement with AIB Group UK PLC to restructure its existing GBP14.6 million loan facility. This is subject to the company securing funding to fulfil its repayment obligations, required by the end of October, and it is seeking to secure this funding through a combination of new debt facilities and a share issue. It said its total debt should fall to GBP9 in October following a capital repayment of GBP400,000.
Reach4entertainment said that the size of its borrowings has meant it has "not been able to achieve its full potential", as this has restricted its ability to invest in growth opportunities, but sees the agreement with AIB as a "catalyst for re-launching the company".
"Overall our trading performance has been comfortably in line with our expectations for this period and the outlook for the full year," said Executive Chairman David Stoller in a statement.
"We are very enthusiastic about the future of our business, following the successful negotiations with AIB to restructure our borrowings as agreed in June. Once the restructuring is completed later this year, r4e will be able to focus on re-launching its new business strategy, building upon our market leading positions in London and New York theatre markets," Stoller added.
Shares in Reach4entertainment were down 12% at 2.26 pence Wednesday morning.
By Hana Stewart-Smith; hanassmith@alliancenews.com; @HanaSSAllNews
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