Aeorema Comm. Regulatory News (AEO)

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Aeorema Communications plc / Index: AIM / Epic: AEO / Sector: Media

29 March 2023

Aeorema Communications plc

("Aeorema", the "Company" or the "Group")

Interim Results

Aeorema Communications plc (AIM: AEO), a leading strategic communications group, is pleased to announce its unaudited interim results for the six months ended 31 December 2022.

Highlights

· Record level revenue of £7,121,103 (H1 2021: £4,909,742)

· Record level profit before taxation of £326,021 (H1 2021: £255,677)

· A period of continued growth and major investment for the Group

· Eventful Limited returning to profitability

· Substantially increased cash position of £3,676,194 (31 December 2021: £1,534,217)

Chairman's Statement

The six-month period ended 31 December 2022 has been a period of continued growth and major investment for the Group, following the record financial year we announced in November.

Group revenue increased by 45% year-on-year to £7.12 million (H1 2021: £4.91 million) and profit before taxation by 28% to £0.33 million (H1 2021: £0.26 million). The Group continues to invest in the team, our processes, and offices, in order to put us in a strong position to achieve sustained growth and success in the future.

The team continues to adapt and diversify to meet the range of demands and evolving needs, of both new and existing clients. As a fully integrated agency, the Group has consistently delivered innovative and bespoke events on a live, virtual and hybrid basis to a range of clients across many sectors. Moreover, the team has been able to capitalise on the ever-changing nature of the industry by expanding our offerings to include long-term communication campaigns and consultancy services. The development of a longer-term client partnership approach has successfully been executed with leading brands across multiple regions and markets. The flexible nature of the business model has enabled the Group to maintain a loyal base of blue-chip clients.

I am thrilled that the team's remarkable efforts have been recognised with award nominations and successful wins, both during and post-period end. Cheerful Twentyfirst, Aeorema's main operating division, won Creative Team of the Year for the fifth year running at the Conference News Agency Awards, Best Agency at the Micebook V Award, and Best Place to Work and Global Agency of the Year at the C&IT awards. Winning these high-profile awards not only bears testament to the strong ability of our team, but also affirms the Group's leading position in the sector.

We are delighted to announce, as a post-period end event, that we are working with Stagwell Inc. a NASDAQ listed, multi-billion-dollar challenger in the marketing network, on a unique brand activation 'Sport Beach' at Cannes Lions International Festival of Creativity. The activation is expected to be one of the largest brand activations in Cannes this year, and with discussions ongoing surrounding other additional contracts, 2023 has a promising outlook to be our biggest presence at the festival to date.

We continue to benefit from an increased global footprint, a growing presence in mainland Europe (with the opening of our Amsterdam office), and we continue to seek additional growth opportunities in line with our global growth strategy. Moreover, we look to serve the growing needs and requests of our clients operating in London and New York, by continuing the increased integration of the respective offices, as well as expanding our own presence in the North American market.

We are pleased to report that Eventful Limited, our venue sourcing and incentive travel agency, has had a strong six months with a record number of events. I am optimistic that we will be able to report a return to profitability at the end of the 2023 financial year.

Following the introduction of our client carbon measurement programme and the addition of a Sustainability Director in April 2022, post-period end we were pleased to launch our third annual Corporate Social Responsibility ("CSR") charter. The CSR charter was established as part of our transition into a value-led agency that views people, planet and prosperity as a balanced scale.

The 2023 CSR charter introduced several new environmental initiatives and commitments including the publication of our 2022 operational carbon footprint, and the offsetting of the Group's last three years' carbon emissions. A revised assessment tool, which considers the social and environmental impact of any new project also enables us to take on briefs that match our ethos and reinforce our commitment to become Net Zero by 2030.

We are very confident about the outlook for the remainder of the 2023 financial year. As mentioned earlier, we have more significant projects at Cannes this year than ever before. The investment we have made in strengthening our team and resources is a significant factor in the growth we have achieved, and it provides us with the structure to achieve significant revenue growth going forward. We are also confident that we can maintain our policy of paying a dividend to shareholders without limiting our growth opportunities.

Finally, I would like to take the opportunity to thank our dedicated team and our shareholders for their continued support and I look forward to what the rest of the year will bring.

M Hale

Chairman

28 March 2023

For further information contact:

Notes to Editors 

Aeorema Communications plc, (AIM: AEO) is a leading strategic communications group with offices in London, New York and Amsterdam. The Group provides bespoke event services, comprising live, virtual, and hybrid experiences to an established international blue-chip client base spanning a broad range of sectors, including finance, professional services, advertising, IT, gaming, fashion, fintech, and beverages. The Group also provides high level consultancy services to help clients maximise and deliver on their long-term communication strategies over multiple event and film touchpoints.

Aeorema delivers these services via its fully owned companies Cheerful Twentyfirst and Cheerful Twentyfirst, Inc. (the North American arm of Cheerful Twentyfirst) (cheerfultwentyfirst.com), two live events agencies with film capabilities that specialise in devising and delivering corporate communication solutions. The Group also operates Eventful Limited (www.eventful.co.uk), which provides consultative, high-touch services including assisting clients with venue sourcing, event management and incentive travel. With more than 56 years of combined operating experience and extensive award wins, Aeorema is a recognised industry thought leader and for the year ended 30 June 2022 reported record revenue and profits (before tax) of £12.2 million and £843,564 respectively, and also declared a dividend for the year.

Central to all that the Group does is its Corporate Social Responsibility charter, which is focussed on ensuring sustainable, inclusive and ethical business operations. To this end, the Group is a pioneer in delivering innovative strategies and services, including a client carbon measurement programme to establish a formal structure and approach around reducing emissions and offsetting both its own and its clients' carbon footprint.

CONDENSED CONSOLIDATED INCOME STATEMENT

For the period ended 31 December 2022

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

For the period ended 31 December 2022

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the period ended 31 December 2022

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

For the period ended 31 December 2022

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the period ended 31 December 2022

1. General information

Aeorema Communications plc is a public limited company incorporated within the United Kingdom. The company is domiciled in the United Kingdom and its principal place of business is 87 New Cavendish Street, London, W1W 6XD. The Company's ordinary shares are traded on the AIM market of the London Stock Exchange.

These condensed consolidated interim financial statements for the period ending 31 December 2022 (including comparatives for the periods ended 31 December 2021 and 30 June 2022) were approved by the board of directors on 28 March 2023.

The financial information set out in this interim report does not constitute statutory accounts for the purposes of section 434 of the Companies Act (2006). The Group's statutory financial statements for the year ended 30 June 2022, prepared under International Financial Reporting Standards (IFRS), have been filed with the Registrar of Companies. The auditor's report for those financial statements was unqualified and did not contain a statement under section 498 (2) or section 498 (3) of the Companies Act (2006).

The interim financial statements have been prepared using the accounting policies set out in the Group's 2022 statutory accounts and have not been audited.

Copies of the annual statutory financial statements and the interim report can be found on our website at www.aeorema.com or can be requested from the Company Secretary at the Company's registered office: 64 New Cavendish Street, London, W1G 8TB.

2. Basis of preparation

These condensed consolidated interim financial statements for the period ended 31 December 2022 have been prepared in accordance with IAS 34, 'Interim Financial Reporting' as adopted by the European Union. The interim condensed consolidated financial statements should be read in conjunction with the annual financial statements for the year ended 30 June 2022, which have been prepared in accordance with IFRS as adopted by the European Union

3. Revenue and segmental results

The Company uses several factors in identifying and analysing reportable segments, including the basis of organisation such as differences in products and geographical areas. The Board of Directors, being the chief operating decision makers, has determined that for the period ended 31 December 2022 there is only one reportable operating segment.

4. Income tax charge

Income period tax is accrued based on the estimated average annual effective income tax rate of 19 per cent (2021: 19 per cent).

5. Earnings per share

Basic earnings per share is calculated by dividing the profit attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the year.

Diluted earnings per share are calculated by dividing the profit attributable to ordinary owners of the parent by the weighted average number of ordinary shares outstanding during the year plus the weighted average number of ordinary shares that would have been issued on the conversion of all dilutive potential ordinary shares into ordinary shares.

The following reflects the income and share data used and dilutive earnings per share computations:

6. Dividends

During the interim period a dividend of 2 pence per share (2021: Nil) was declared to holders of the Company's ordinary shares in respect of the full year ended 30 June 2022.

7. Related party transactions

The Group has a related party relationship with its subsidiaries and its directors. Transactions between Group companies, which are related parties, have been eliminated on consolidation and are therefore not included in these consolidated interim financial statements.

Harris & Trotter LLP is a firm in which S Haffner is a member. The following was charged to the Group in respect of professional services.

Fees charged to Aeorema Communications plc include £7,500 (2021: £7,500) for the services of S Haffner as a non-executive director of that company.

The compensation of key management (including directors) of the Group is as follows:

During the period S Quah received an interest-free loan of £40,000 which has now been repaid. As at 31 December 2022 £50,000 (2021: £10,000) was outstanding.