Last checked at 14 Dec 2010 18:24
Catalyst Media Group Plc
('CMG' or the 'Group')
Interim Results for Six Months Ended 30 September 2010
Catalyst Media Group Plc ("CMG") announces its interim results for the six months ended 30th September 2010.
CMG is a 20.54% shareholder in Satellite Information Services (Holdings) Ltd ("SIS") and the results include its share in the profits of SIS as an equity accounted associate.
Financial Highlights for the six months to 30 September 2010
Michael Rosenberg, Chairman of CMG commented:
"We are pleased to report that the results of SIS are ahead of our expectations for the period under review.
Although SIS has a policy of declaring and paying dividends no decision has yet been taken on the timing or quantum of the next dividend payment. Once a decision has been taken shareholders of CMG will be informed.
As previously stated we have reorganized our capital structure so as to enable payment of dividends or other forms of distribution in the future as and when such distributions are received from SIS. The Court approval for this was granted on 28th October 2010."
Enquiries
Michael Rosenberg, Non-executive Chairman: 07785 727595
Melvin Lawson, Non-executive Director: 020 7637 8412
Strand Hanson Limited: 020 7409 3494
James Harris
Angela Peace
Chairman's statement
I am pleased to report that for the six months ended 30th September 2010 the Group has generated a net profit after taxation of £1,770,674 (2009 (restated): £1,362,708). Net assets at 30 September 2010 were £31,313,085 (2009 (restated): £27,068,197). Net assets per share were 112 pence per share (2009 (restated): 97 pence per share).
During the period under review the Company's net debt was reduced to approximately £485,000 (2009: £3.8 million).
SIS
The main asset of the Group remains the 20.54% stake in Satellite Information Services (Holdings) Ltd ("SIS"). CMG equity accounts for its share in the profits of SIS.
The revenues of SIS during the period included £76 million derived from the long established business of providing integrated television and data services to licensed betting offices in the UK, Ireland and overseas.
Revenues of £52 million were generated from the business of SIS LIVE which provides satellite news gathering and associated transmission services to its customers and also provides outside broadcast television production units including sound support and communication.
In August 2010 SIS LIVE, which is Europe's largest outside broadcast and satellite uplink company, won a long term contract to supply the outside broadcast facilities on all of ESPN's football requirements. In September it was announced that it had upgraded the technical facilities for BBC Sport's coverage of Formula 1 motor racing. It has designed and built a brand new HD-ready flyaway unit and outside broadcast truck to capture the BBC Sport's race-weekend footage for BBC One, BBC Red Button and BBC online.
In August 2010 SIS LIVE also upgraded and expanded the Sky Sports News Satellite News Gatheringfleet for the launch of Europe's first fully High Definition sports service, Sky Sports News HD. It has secured a long term contract to supply Sky Sports News within its Satellite News Gathering outside broadcast capabilities consisting of six dedicated Satellite News Gathering outside broadcast trucks all built to the highest HD specifications. SIS now provides 21 dedicated Satellite News Gathering HD trucks across the Sky Group.
SIS LIVE provided full host broadcast television production facilities for the Commonwealth Games in India during October 2010. Whilst TV coverage was concluded successfully, this major event has not been without its challenges for SIS some of which still remain to be resolved.
In November it was announced that SIS and Peel Media, owners of MediaCityuk had agreed a major new joint venture to run MediaCityuk's state of the art studio facilities including post production, content and technical services as well as managing all connectivity. At the same time, the joint venture signed a ten year contract to deliver an enhanced range of production and technical services to the BBC when it moves to the new site in Manchester next year.
The services to the betting industry are supported in the main by fixed term contracts both with the retail owners of betting shops and with the racecourses that enable pictures to be delivered to those shops. Following the signing of long term rights agreements by SIS with Arena Leisure Plc and Northern Racing Limited, combined with other courses that have subsequently renewed contracts, SIS now holds long term media rights representing in excess of 50% of all UK horse racing fixtures. This ensures the supply of images and data from the coverage of horseracing fixtures at these racecourses until 2016 and 2017 respectively.
In June 2010 it was announced that the BAGS greyhound picture and data contract had been extended through to the end of 2015. In the same month an exclusive five year contract was agreed with PhumelelaGold Enterprises to supply South African horse racing pictures and data products to UK and Irish betting shops. This covers racing from South Africa's ten thoroughbred tracks with over 400 fixtures annually.
SIS has also announced plans to relocate its London operation to MediaCityuk in Salford Quays, Manchester. This will be a phased move and is due to be completed by 2013. SIS will take a minimum of 25,000 sq ft of space and expects to have in excess of 100 staff working in Salford.
Strategic Review
After some months of discussions with various parties interested in the possible acquisition of our stake in SIS the board has concluded that the best interests of shareholders would be served by retaining this stake and continuing as a quoted company for the immediate future. Accordingly the board has terminated all such discussions and all parties have withdrawn their interest.
As stated above the SIS business continues to perform well and it is expected that dividends will continue to be paid by SIS subject to its cash flow needs for the foreseeable future. On that assumption the remaining borrowings within the CMG group should be eliminated within the next 12 months or possibly sooner, it would then be the intention to utilize free cash flow to make appropriate distributions to our own shareholders.
Notes to Editors
SIS principal activities are
Uplink Services and Outside Broadcast are managed under the common brand of SIS LIVE.
Consolidated interim statement of comprehensive income
Notes | 6 months to 30 September 2010
£ Unaudited | 6 months to 30 September 2009 (As restated) £ Unaudited | Year to 31 March 2010
£ Audited | |
Revenue | 12,500 | 26,875 | 43,909 | |
Cost of sales | - | - | (95,292) | |
Gross (loss) profit | 12,500 | 26,875 | 51,383 | |
Administrative expenses | (91,808) | (140,253) | (290,212) | |
Operating loss | (79,308) | (113,378) | (341,595) | |
Financial income | 47 | 23 | 88 | |
Financial costs | 4 | (20,951) | (127,627) | (201,569) |
Net financial costs | (20,904) | (127,604) | (201,481) | |
| ||||
Share of profit of equity-accounted associate | 1 | 1,835,249 | 1,454,232 | 3,812,224 |
Profit before taxation | 1,735,037 | 1,213,250 | 3,269,148 | |
Taxation | 35,637 | 149,458 | 752,840 | |
Profit for the period | 1,770,674 | 1,362,708 | 4,021,988 | |
Share of other comprehensive (loss) / income of associate | - | 411 | (184,655) | |
Total comprehensive income for the period | 1,770,674 | 1,363,119 | 3,837,333 | |
Attributable to equity holders of the company | 1,770,674 | 1,363,119 | 3,837,333 | |
Earnings per share: | 5 | |||
Basic | 6.29p | 4.84p | 14.29p | |
Diluted | 6.29p | 4.84p | 14.29p | |
Consolidated interim statement of financial position
30 September 2010
£ Unaudited | 30 September 2009 (As restated) £ Unaudited | 31 March 2010
£ Audited | ||
Assets | ||||
Non-current assets | ||||
Intangible assets | - | - | ||
Property, plant and equipment | - | 111 | - | |
Investment in associate | 1 | 31,790,597 | 30,697,424 | 29,955,348 |
31,790,597 | 30,697,535 | 29,955,348 | ||
Current assets | ||||
Trade and other receivables | 30,463 | 156,978 | 82,592 | |
Corporation tax receivable | 12,233 | 104,377 | 327,198 | |
Cash and cash equivalents | 132,951 | 35,628 | 46,444 | |
175,647 | 296,983 | 456,234 | ||
Total assets | 31,966,244 | 30,994,518 | 30,411,582 | |
Equity and liabilities | ||||
Capital and reserves attributable to equity holders of the parent | ||||
Share capital | 9,243,197 | 9,243,197 | 9,243,197 | |
Share premium | 38,904,450 | 38,904,450 | 38,904,450 | |
Merger reserve | 2,402,674 | 2,402,674 | 2,402,674 | |
Retained deficit | (19,237,236) | (23,482,124) | (21,007,910) | |
31,313,085 | 27,068,197 | 29,542,411 | ||
Non-current liabilities | ||||
Interest-bearing loans and borrowings | 617,787 | 3,834,649 | 806,854 | |
Current liabilities | ||||
Interest-bearing loans and borrowings | - | - | - | |
Trade and other payables | 35,372 | 91,672 | 62,317 | |
35,372 | 91,672 | 62,317 | ||
Total equity and liabilities | 31,966,244 | 30,994,518 | 30,411,582 | |
Notes to the interim financial statements
1 | Investment in associate | Share of net assets | Fair Value of Intangibles | Total
| |||
| Group | Group | Group | ||||
| £ | £ | £ | ||||
| Cost | ||||||
| At 1 April 2010 | 8,777,307 | 21,178,041 | 29,955,348 | |||
| Additions - share of profit | 1,835,249 | - | 1,835,249 | |||
| Additions - share of other comprehensive income | - | - | - | |||
| Dividend received | - | - | - | |||
| At 30 September 2010 | 10,612,556 | 21,178,041 | 31,790,597 | |||
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|
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The Group's interest in the associate, Satellite Information Services (Holdings) Limited, a company incorporated in Great Britain, ('SIS') is held by Alternateport Limited. Alternateport Limited holds an investment of 20.54% in the equity share capital of SIS and is entitled to appoint a director and alternate director to the SIS board. This right has been exercised since acquisition. Alternateport Limited is a wholly owned subsidiary of Catalyst Media Holdings Limited a wholly-owned subsidiary of the Company. The intangible assets represent the value attributable to the ongoing business activities of SIS. These are subject to an annual impairment review.
Share of profit of associate | 30 September 2010 SIS Total £'000 | 30 September 2010 CMG share £'000 | 30 September 2009 (As restated) CMG share £'000 | 31 March 2010 CMG share £'000 | |
Revenue: | |||||
Racing services | 66,969 | 13,755 | 12,591 | 29,286 | |
SIS live services | 43,063 | 8,845 | 7,011 | 11,424 | |
Total revenue | 110,032 | 22,600 | 19,602 | 40,710 | |
Operating profit from ongoing operations | 12,794 | 2,628 | 2,009 | 5,457 | |
Net interest receivable | - | - | - | - | |
Net interest payable | (1,249) | (257) | (114) | (298) | |
Gain on disposal of subsidiary | - | - | - | 203 | |
Profit before tax | 11,545 | 2,371 | 1,895 | 5,362 | |
Taxation | (2,610) | (536) | (441) | (1,550) | |
Share of profit after taxation | 8,935 | 1,835 | 1,454 | 3,812 | |
Net income from associate | 8,935 | 1,835 | 1,454 | 3,812 | |
Other comprehensive income | |||||
Actuarial (loss) /gain | - | - | - | (257) | |
Deferred tax | - | - | - | 72 | |
- | - | - | (185) | ||
Share of gross assets and liabilities of associate | |||||
Gross assets | 114,416 | 23,501 | 21,353 | 29,005 | |
Gross liabilities | (62,749) | (12,889) | (11,835) | (20,228) | |
Net equity | 51,667 | 10,612 | 9,518 | 8,777 | |
2 | Corporate information |
Catalyst Media Group Plc ("the Company") is a company incorporated in England and Wales and quoted on the London Stock Exchange's Alternative Investment Market. |
3 | Basis of preparation |
These interim financial statements of the Company and its subsidiaries ("the Group") for the six months ended 30 September 2010 have been prepared in accordance with International Financial Reporting Standards (IFRSs and IFRIC interpretations) as adopted by the European Union and also in accordance with the Companies Act 2006.
The accounting policies adopted for the preparation of this interim statement are consistent with the accounting policies adopted in the financial statements for the year ended 31 March 2010.
The financial information set out above does not constitute statutory accounts as defined in section 434 of the Companies Act 2006. Statutory accounts for the twelve months to 31 March 2010, on which the report of the auditors was unqualified and did not contain a statement under section 498 of the Companies Act 2006, have been filed with the Registrar of Companies. | |
4 | Finance expenses | 6 months to 30 September 2010 £ | 6 months to 30 September 2009 £ | Year to 31 March 2010 £ |
|
| |||
Interest payable | 15,322 | 75,641 | 121,009 | |
Amortisation of transaction costs and other loan redemption fees | 5,629 | 51,986 | 80,560 | |
20,951 | 127,627 | 201,569 |
5 | Earnings per share
|
The calculation of the basic earnings per share is based upon the following: |
6 months to 30 September 2010 £ | 6 months to 30 September 2009 (As restated) £ | Year to 31 March 2010 £ | ||
Basic and Diluted |
|
| ||
|
| |||
Earnings per share - pence | 6.29p | 4.84p | 14.29p | |
Profit attributable to equity shareholders | £1,770,674 | £1,362,708 | £4,021,988 | |
Weighted average number of shares in issue | 28,143,197 | 28,143,197 | 28,143,197 | |
6 | Dividend
|
The Directors have not declared a dividend for the interim period ended 30 September 2010. |
7 | Restatement
|
The financial statements to 31 March 2010 included a prior year adjustment as a result of an alignment of accounting policies between the Group's equity accounted associate, SIS; a Group which prepares its financial statements in accordance with UK GAAP. The adjustments required as a result of this alignment have given rise to the restatement as detailed below.
The Group's opening retained earnings as at 30 September 2009 have been increased by £486,182 from the previously reported figure of £23,968,306.
Effect on Balance Sheet | As previously stated |
As restated |
Restatement |
30 Sept 2009 | 30 Sept 2009 | 30 Sept 2009 | |
£ | £ | £ | |
Investment in associate | 30,211,242 | 30,697,424 | 486,182 |
Retained earnings | (23,968,306) | (23,482,124) | 486,182 |
Increase in equity | (23,968,306) | (23,482,124) | 486,182 |
Effect on Income Statement | As previously stated |
As restated |
Restatement |
| |
2009 | 2009 | 2009 |
| ||
£ | £ | £ |
| ||
Increase in share of profit from |
| ||||
equity accounted investment: |
| ||||
Year to 31 March 2009 | 3,102,773 | 3,402,657 | 299,884 |
| |
6 months to 30 September 2009 | 1,268,345 | 1,454,643 | 186,298 |
| |
| |||||
Increase in profit from continuing operations | 4,371,118 | 4,857,300 | 486,182 |
| |
| |||||
Effect on Earnings per share | As previously stated |
As restated |
Restatement |
6 months to | 6 months to | 6 months to | |
30 Sept 2009 | 30 Sept 2009 | 30 Sept 2009 | |
p | p | p | |
Earnings per share | 4.20 | 4.84 | 0.64 |
There was no cash flow impact as a result of the restatement. Additionally, there was no material difference arising from the above restatement of the Group's Statement of Financial Position as at 1 October 2008 compared with that previously reported as at 30 September 2008. Therefore no Statement of financial position as at 1 October 2008 has been prepared.
Consolidated interim cashflow statement
|
6 months to 30 September 2010 £ Unaudited |
6 months to 30 September 2009 (As restated) £ Unaudited |
Year to 31 March 2010 £ Audited | |
|
| |||
Cash flow from operating activities | ||||
Profit before taxation including discontinued operations | 1,663,969 | 1,213,250 | 3,269,148 | |
Adjustments for: | ||||
Depreciation, amortisation and impairment | - | 167 | 278 | |
Share of profit from associate | (1,764,181) | (1,454,232) | (3,812,224) | |
Finance income | (47) | (23) | (88) | |
Finance expense | 20,951 | 70,750 | 201,569 | |
Corporation taxes recovered | 350,602 | 163,471 | 544,032 | |
Net cash flow from operating activities before changes in working capital | 271,294 | (6,617) | 202,715 | |
(Increase)/decrease in trade and other receivables | 46,498 | 75,341 | 69,167 | |
Increase/(decrease) in trade and other payables | (26,943) | (106,070) | (135,967) | |
Net cash flow used in operating activities | 290,849 | (37,346) | 135,915 | |
Investing activities | ||||
Dividend received | - | - | 2,915,002 | |
Interest received | 47 | 23 | 88 | |
Net cash flow from investing activities | 47 | 23 | 2,915,090 | |
Financing activities | ||||
Proceeds from long-term borrowings | - | - | 200,000 | |
Repayment of long-term borrowings | (189,067) | - | (3,157,045) | |
Interest and early redemption fees paid | (15,322) | - | (120,467) | |
| ||||
Net cash outflow from financing activities | (204,389) | - | (3,077,512) | |
Net increase/(decrease) in cash and cash equivalents in the period | 86,507 | (37,323) | (26,507) | |
Cash and cash equivalents at the beginning of the period | 46,444 | 72,951 | 72,951 | |
Cash and cash equivalents at the end of the period | 132,951 | 35,628 | 46,444 |
.
Notes to the interim financial statements
Share capital
£ Unaudited | Share Premium
£ Unaudited | Merger reserve
£ Unaudited | Retained deficit
£ Unaudited | Total shareholders equity £ Unaudited | |
At 1 April 2009 | 9,243,197 | 38,904,450 | 2,402,674 | (25,145,127) | 25,405,194 |
Prior period adjustment (1) | - | - | - | 299,884 | 299,884 |
At 1 April 2009 restated | 9,243,197 | 38,904,450 | 2,402,674 | (24,845,243) | 25,705,078 |
Profit for the 6 month period to 30 September 2009 | - | - | - | 1,176,821 | 1,176,821 |
Share of other comprehensive income of associate | - | - | - | - | - |
Total comprehensive income for the period | - | - | - | 1,176,821 | 1,176,821 |
At 30 September 2009 (2) | 9,243,197 | 38,904,450 | 2,402,674 | (23,668,422) | 26,881,899 |
Prior period adjustment (1) | - | - | - | 186,298 | 186,298 |
At 30 September 2009 restated | 9,243,197 | 38,904,450 | 2,402,674 | (23,482,124) | 27,068,197 |
Profit for the 6 month period to 31 March 2010 | - | - | - | 2,658,869 | 2,658,869 |
Share of other comprehensive income of associate | - | - | - | (184,655) | (184,655) |
Total comprehensive income for the period | - | - | - | 2,474,214 | 2,474,214 |
At 31 March 2010 | 9,243,197 | 38,904,450 | 2,402,674 | (21,007,910) | 29,542,411 |
Share capital
£ Unaudited | Share Premium
£ Unaudited | Merger reserve
£ Unaudited | Retained deficit
£ Unaudited | Total shareholders equity £ Unaudited | |
At 1 April 2010 | 9,243,197 | 38,904,450 | 2,402,674 | (21,007,910) | 29,542,411 |
Profit for the 6 month period to 30 September 2010 | - | - | - | 1,770,674 | 1,770,674 |
Share of other comprehensive income of associate | - | - | - | - | - |
Total comprehensive income for the period | - | - | - | 1,770,674 | 1770,674 |
At 30 September 2010 | 9,243,197 | 38,904,450 | 2,402,674 | (19,237,236) | 31,313,085 |
(1) Total prior period adjustment for the period to 30 September 2009 is £485,771.
(2) The retained deficit stated as at 30 September 2009 was as follows:
£ | |
As above | (23,668,422) |
Prior period adjustment as at 1 April 2009 | (299,884) |
As stated as at 30 September 2009 | (23,968,306) |