Brave Bison Regulatory News (BBSN)

Brave Bison Group plc

("Brave Bison" or "the Group" or "the Company")

Interim results for the six months ended 30 June 2017

Brave Bison Group plc (AIM: BBSN), the independent digital media & social video business, today announces its interim year results for the six months ended 30 June 2017. 

Financial Highlights 

· Net Revenue of £6million for the period, at a substantially increased gross profit margin of 48% (1H 2016: 39%), through increased focus on high margin business

· Achieved positive Adjusted EBITDA of £64k for the period (1H 2016 negative Adjusted EBITDA of £839k)

· Cash balance at end of period of £5.3m

Operational Highlights

· Business momentum has been driven by six figure branded content deals

· Investments made in high growth opportunities, including Rebel FC

· Costs efficiency measures included the creation of Yellowstone Studios and centralising of operations in two major hubs, London and Singapore.

· New CEO Claire Hungate appointed, to commence role in August 2017

 Kevin Deeley, Chief Operating and Finance Officer, commented:

"When I agreed to take on the responsibilities of the Chief Executive Officer in January this year, it was with the aim of bringing some stability to this promising, innovative and creative business while a permanent CEO was sought. The financial results for the first half of the year demonstrate that Brave Bison has the potential to deliver strong performance by focussing on high-value activity as a producer and broadcaster of social video. I wish our new CEO Claire Hungate the very best as she takes on the leadership of this exciting business."

For further information please contact:

This announcement is available on the Group's website, www.bravebison.io.

This announcement contains inside information as defined in EU Regulation No. 596/2014 and is in accordance with the Brave Bison obligations under Article 17 of that Regulation.

Financial and Business Review

During the first half of the year the Group has continued to pursue the established strategic imperatives of simplifying the business, moving up the value chain and achieving stand-alone financial sustainability. The first quarter of 2017 saw generally difficult trading, but in the latter months the company has delivered more encouraging results, helped by improved cash collection, demonstrating what can be achieved.

Advertising remains by far the most significant revenue stream, accounting for 86% of Net Revenue (2016: 75%). Growth has been driven by six figure branded content deals amounting to 37% of Net Revenue (2016: 13%), and we continue to undertake repeat business direct with leading global brands such as P&G and via agencies such as Havas. This solid performance is despite the fact that in 2016 the first half revenue result was substantially enhanced by activities around the European Football championship tournament in France, whereas there has been no similar large advertising friendly event in 2017. A further challenge this half-year has been the well-publicised difficulties faced by online video platforms that have lost major advertisers as a result of fears around inappropriate content. This has adversely affected the Group somewhat, but such revenues still accounted for 18% (2016: 11%) of Net Revenue. However, the Group enters the second half of the year with a much stronger advertising pipeline than we entered the first half, and we remain on target to achieve management and market revenue expectations for the full year.

The Group has continued to move up the value chain. In the first quarter of 2017 we began a process of reducing the amount of low margin business we undertake, which was completed in May 2017. This has of course diminished the revenue line, this activity accounted for 26% (2016: 44%) of revenue, but has allowed us to report much higher overall margins this half year than last. Going into the second half of the year we are now achieving sustainable gross profit margins in excess of 50%. To drive future profitable growth we have continued to invest tactically where we see opportunities, for example in the establishment of Rebel FC, a football team made up of established young stars of social media.

On the cost front, the Group has delivered further re-structuring savings, in particular closing small satellite offices and centralising operations in two major hubs, London and Singapore. As a result, headcount at 30 June 2017 has fallen to 57 (June 2016: 124). Any future new headcount will be in key territories and products where we see potential for profitable growth. During the first half we have continued to invest in talent and content production to support our growing owned and operated SlashFootball brand, and we opened Yellowstone Studios in early 2017 as we believe that having our own dedicated production facility could drive those costs lower, we will assess the results later in the year, and the facility is on a short-term lease.

The ending of low margin activities has had the additional benefit of allowing a material reduction in the volatility of cash-flows, and we have also sought and achieved better payment terms from clients. We were therefore able to restrict cash outflows from operations to £1.2m (2016: £4.0m) and ended the half-year with a healthy £5.3m of cash as a result.

Outlook

The Group has had an encouraging start to 2017, bringing us significantly closer to profitability. Management will seek to continue this momentum under a its new Chief Executive Officer, Claire Hungate and my successor as Chief Finance Officer, where good progress is being made in making an appointment.

 On behalf of the Board

Kevin Deeley

Chief Operating and Financial Officer

 31 July 2017

BRAVE BISON GROUP PLC

CONSOLIDATED INCOME STATEMENT AND CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the six months ended 30 June 2017

All transactions arise from continuing operations.

BRAVE BISON GROUP PLC

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

As at 30 June 2017

BRAVE BISON GROUP PLC

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the six months ended 30 June 2017

BRAVE BISON GROUP PLC

NOTES TO THE FINANCIAL STATEMENTS

1 General information

The information for the year ended 31 December 2016 does not constitute statutory accounts as defined in section 435 of the Companies Act 2006. A copy of the statutory accounts has been delivered to the Registrar of Companies. The auditors reported on those accounts: their report was unqualified, did not draw attention to any matters by way of emphasis and did not contain a statement under section 498 (2) or (3) of the Companies Act 2006. The interim financial statements have not been audited or reviewed by the Group's auditor.

2 Accounting policies

Basis of preparation

The annual financial statements of Brave Bison Group plc are prepared in accordance with IFRS as adopted by the European Union. The condensed set of financial statements included in this half yearly report has been prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting", as adopted by the European Union. The interim statement has been prepared on a going concern basis, which assumes that the Group will be able to meet its liabilities for the foreseeable future. The Group is dependent for its working capital requirements on cash generated from operations, cash holdings and from equity markets. The cash holdings of the Group at 30 June 2017 were £5.3 million.

Significant accounting policies

The accounting policies applied by the Group in this condensed set of consolidated financial statements are the same as those applied by the Group in its consolidated financial statements as at and for the year ended 31 December 2016. 

Adoption of new and revised standards

At the date of authorisation of the financial statements, certain new standards, amendments and interpretations to existing standards have been published by the IASB but are not yet effective, and have not been adopted early by the Group. Management anticipates that all of the relevant pronouncements will be adopted in the Group's accounting policies for the first period beginning after the effective date of the pronouncement. Information on new standards, amendments and interpretations that are expected to be relevant to the Group's financial statements are provided in the Group financial statements. Certain other new standards and interpretations have been issued but are not expected to have a material impact on the Group's financial statements.

3 Segment reporting

Management identify only one operating segment in the business, being monetising online video content. This single operating segment is monitored and strategic decisions are made on the basis of this segment alone.

As a result, only the geographic reporting of revenue analysis has been included in this note.

The breakdown of net assets and capital expenditure for geographic reporting has not been shown as it can only be provided as an arbitrary breakdown.

Geographic reporting

As anticipated in the 2016 Annual Report, Group geographic reporting will henceforth focus on our two operational hubs, with the analysis based on the customers' location. Geographic reporting has also been updated to present net revenue as this is the information used by management.

The analysis of revenue by each stream is detailed below.

4 Finance costs

5 Loss per share

Both the basic and diluted loss per share have been calculated using the loss after tax attributable to shareholders of Brave Bison Group plc as the numerator, i.e. no adjustments to losses were necessary in 2016 or 2017. The calculation of the basic loss per share is based on the loss attributable to ordinary shareholders divided by the weighted average number of shares in issue during the period. All share options and warrants have been excluded when calculating the diluted earnings per share (EPS) as they were anti-dilutive.

6 Share capital

Rights attributable to ordinary shares

The holders of ordinary shares are entitled to receive notice of and attend and vote at any general meeting of the Company.

7 Financial Instruments

Financial instruments measured at fair value

Financial assets and financial liabilities measured at fair value in the statement of financial position are grouped into three levels of fair value hierarchy. This grouping is determined based on the lowest level of significant inputs used in fair value measurement, as follows:

· Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities

· Level 2 - inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices)

· Level 3 - inputs for the asset or liability that are not based on observable market data (unobservable inputs).

8 Contingent liabilities

There were no contingent liabilities at 30 June 2017 (30 June 2016 and 31 December 2016: None).

9 Transactions with Directors and other related parties

There have been no material changes in the related party transactions described in the last annual report aside from those disclosed elsewhere in this interim statement.

10 Subsequent events

On 10 July 2017, Kevin Deeley, Chief Operating & Financial Officer, tendered his resignation, which was accepted.