CTEA.L Regulatory News (CTEA)

14 Jun 2007 07:01

Milestone Group PLC14 June 2007 MILESTONE GROUP PLC RESULTS FOR THE SIX MONTHS ENDED 31 MARCH 2007 AIM listed Milestone Group PLC ("Milestone" or the "Company") announces itsresults for the six months ended 31 March 2007. Highlights •Operating loss for the six months ended 31 March 2007 reduced to £0.7m inclusive of a £0.3m provision for management restructuring (six months ended 31 March 2006 operating loss: £2.0m) £€0.6m of cash reserves (31 March 2006: £0.7m) •Management restructure as strategic review approaches conclusion Milestone Chairman, John Sanderson, said: "The Company's strategic review is now entering its final stages and the Boardintends to make an announcement to shareholders in due course." For further information: Milestone Group PLC Tel: 020 7580 2444John Sanderson, Chairman Arden Partners plc Tel: 020 7398 1632Richard Day / Adrian Trimmings Below: Chairman's StatementUnaudited Consolidated Profit & Loss AccountUnaudited Consolidated Balance SheetUnaudited Consolidated Cashflow statementNotes to the interim financial information Milestone Group PLC Results for the six months ended 31 March 2007 CHAIRMAN'S STATEMENT Strategic Review During the financial year ended 30 September 2006, the Board pursued a strategyof maximising shareholder value by undertaking a structured disposal of thegroup's traditional publishing and radio assets. The strategy fulfilled twoessential objectives for the group: (i) to eliminate losses from continuedtrading in an increasingly challenging publishing and radio environment and (ii)to provide cash from asset sales to provide working capital and enable theCompany to explore new opportunities on behalf of shareholders. This review isongoing and it is intended to make further announcements to shareholders in due course. Television Division Loss reduced to £40,000 on turnover of £46,000 (2006: loss of £96,000 onturnover of £76,000) The television division continues to trade at a modest loss broadly in line withexpectations. Although investment in the group's local TV licences has beenfully written down in the Company's books, the Board believes the channels couldadd value either to an enlarged Milestone Group or a third party. The future ofthe assets is therefore likely to be influenced by the Company's wider strategicreview which is ongoing. In the meantime, trading is expected to remain subduedin light of the exceptionally low overheads now in place. The Company continues to be at the forefront of campaigning for local televisionto gain access to the Freeview platform post digital switchover. Meetings havebeen attended with both DCMS and DTI who are now expecting to make policydecisions, with Ofcom, in the coming year. Post Balance Sheet Events The Board announced in May 2007 that, in order to facilitate the conclusion ofthe group's strategic review, the Company's two executive directors had agreedto stand down from their full time positions. Milestone's former CEO, Andy Craig, remains on the board as a non-executive director whilst Finance Director,Brian Chester, continues to serve in his original role but in a part timecapacity. As a consequence of these new arrangements, the Company's ongoingmonthly overheads have been significantly reduced. Upon completion of the Company's strategic review, neither Andy Craig or BrianChester will be entitled to any further termination payments. In addition, allthree holders of options under the Milestone Unapproved Share Option Scheme,Andy Craig, Brian Chester and Dan Cass, have agreed to waive all outstandingoptions granted to them. I would like to take this opportunity to express my gratitude to my colleaguesfor the diligent manner in which they are continuing to perform their servicesto Milestone as the Company approaches the final stages of its strategic review. Future Trading The Company has sufficient reserves in place to continue to trade as a goingconcern for the foreseeable future. The Board is considering the likely fundingrequirements of an expansion of the Company's business as part of its strategicreview process. Outlook The Board is working with vigour to seek to bring its strategic review to asatisfactory conclusion. As stated in February 2007, the Company essentially hastwo options: (i) a paper-based acquisition expanding the group's interests andtaking the business in a new direction or (ii) the winding-up of the groupfollowing a sale of the TV division and distribution of any outstanding cash toshareholders. The Company is currently investigating a possible transaction withone particular entity although the final outcome, at this stage, remainsuncertain. The Board is doing all it can to reach a conclusion and intends tomake a further announcement in due course. Throughout this period the Board willremain focused on minimising overheads and losses. John SandersonChairman13 June 2007 Consolidated profit and loss account for the six month period ended 31 March 2007 Audited Audited Unaudited Unaudited Year ended Year ended Audited Six months Six months 30 September 30 September Year ended Note ended ended Continuing Discontinued 30 September 31 March 31 March 2006 2006 Total 2006 2007 2006 £ £ £ £ £ Turnover 50,918 1,762,883 137,719 2,825,183 2,962,902Cost of sales 7,097 1,300,897 110,156 2,312,082 2,422,238 --------- -------- --------- --------- ---------Gross Profit 43,821 461,986 27,563 513,101 540,664 Distributioncosts - 55,295 - 55,295 55,295Impairment ofgoodwill - 557,138 - 471,538 471,538Otheradministrative 770,056 1,817,229 1,293,165 1,549,123 2,842,288expenses --------- -------- --------- --------- --------- (726,235) (1,967,676) (1,265,602) (1,562,855) (2,828,457) Otheroperatingincome 54,381 445 5,120 14,768 19,888 --------- -------- --------- --------- --------- Groupoperating loss (671,854) (1,967,231) (1,260,482) (1,548,087) (2,808,569) --------- -------- --------- --------- ---------Profit/(Loss)on disposal of - 180,796 - (1,227,652) (1,227,652)groupoperations --------- -------- --------- --------- --------- Loss onordinaryactivities (671,854) (1,786,435) (1,260,482) (2,775,739) (4,036,221)beforeinterest Interestreceivable 20,893 457 8,295Interestpayable 2,936 45,854 68,933 --------- -------- --------- Loss onordinaryactivities (653,897) (1,831,832) (4,096,859)beforetaxation Taxation onloss fromordinaryactivities 2 - - 8,885 --------- -------- --------- Loss onordinaryactivities (653,897) (1,831,832) (4,087,974)after taxationMinorityinterest - 47,852 47,717 ========= ======== =========Loss for thefinancial (653,897) (1,783,980) (4,040,257)period ========= ======== ========= Basic anddiluted lossper share 3 (2.4) p (6.4) p (14.8) All recognised gains and losses are included in the profit and loss account Consolidated balance sheet at 31 March 2007 Unaudited Unaudited Audited 31 March 2007 31 March 2006 30 September 2006 Note £ £ £ £ £ £ Fixed assetsIntangible - 2,475,212 -assetsTangible 11,313 496,679 7,535assets --------- --------- ---------Fixed asset - 22,529 -investments --------- --------- --------- 11,313 2,994,420 7,535Current assetsDebtors 136,400 770,369 163,743 -------- --------- -------Cash at bank 593,735 718,066 1,221,181and in hand -------- --------- ------- 730,135 1,488,435 1,384,924Creditors:amounts fallingdue withinone year 516,995 1,321,513 511,045 -------- --------- ------- --------- --------- ---------Net current 213,140 166,922 873,879(liabilities)/assets --------- --------- --------- Total assets 224,453 3,161,342 881,414less currentliabilities Creditors: - 4,192 3,063amounts fallingdue after morethan one year --------- --------- ---------Provisions - 22,523 -for liabilitiesand charges --------- --------- --------- 224,454 3,134,627 878,351 ========= ========= ========= Capital andreservesCalled up 4 2,760,510 2,760,510 2,760,510share capitalShare premium 5 7,692,985 7,692,985 7,692,985accountMerger 5 11,119,585 11,119,585 11,119,585reserve --------- --------- ---------Profit and 5 (21,348,626) (18,438,453) (20,694,729)loss account --------- --------- ---------Equity 224,454 3,134,627 878,351shareholders'funds ========= ========= ========= Consolidated cash flow statement for the six month period ended 31 March 2007 Unaudited Unaudited Audited 31 March 2007 31 March 2006 30 Sept 2006 Note £ £ £ £ £ £ ------- -------- -------- -------- ------- --------Net cashoutflow fromoperating 6 (500,357) (931,465) (1,338,318)activities Returns oninvestments andservicing offinanceInterest 20,893 457 8,295receivedInterest (2,936) (45,854) (68,933)paid ------- -------- ------- Net cash 17,957 (45,397) (60,638)inflow / (outflow)from returnson investmentand servicing offinance TaxationUK corporation tax - - 8,885 CapitalexpenditurePurchase of (7,882) (1,738) (1,744)tangiblefixed assets Receipts - 500 500from sale oftangiblefixed assets ------- -------- ------- (7,882) (1238) (1,244)Acquisitionsand disposalsProceeds - 1,947,175 3,394,066from disposalof businessoperationsCash - (98,667) (210,887)disposed ofwith businessoperations Cost of - (174,611) (333,662)disposal ofbusinessoperations ------- -------- ------- Net cash - 1,673,897 2,849,517inflow fromacquisitionsanddisposals -------- -------- -------- Cash (490,282) 695,797 1,458,202(outflow)inflow beforefinancing FinancingNew Loans - - 211,400advancedLoan (3,063) (1,208) (213,737)repaymentsCapital - (4,676) (11,882)element offinanceleases repaidRepayments/ - (276,883) (283,321)advancesunderinvoicediscountingagreements ------- -------- -------Cash outflow (3,063) (282,767) (297,540)fromfinancing ======== ======== ======== (Decrease) / 7,8 (493,345) 413,030 1,160,662increase in cash in the period ======== ======== ======== Notes to the Interim financial information for the six month period ended 31 March 2007 1 Basis of preparation The Interim Report was approved by the Board of Directors on 13 June 2007. Except as noted below the financial information contained in this Interim Reporthas been prepared on the basis of the accounting policies set out in accordancewith applicable United Kingdom accounting standards in the Group's auditedaccounts for the year ended 30 September 2006. In preparing this information the Group has adopted for the first time FRS 20'Share-based Payment'. This has not resulted in any changes to the current orcomparative period financial information. The financial information for the six months ended 31 March 2007 and 31 March2006 is unaudited. The comparatives for the full year ended 30 September 2006 are not the Company'sfull statutory accounts for that year. A copy of the statutory accounts for thatyear has been delivered to the Registrar of Companies. The auditors' report onthose accounts was unqualified and did not contain a statement under section 237(2)-(3) of the Companies Act 1985." 2 Taxation Deferred tax assets have not been recognised on the basis that their futureeconomic benefit is not certain. 3 Loss per share Basic loss per share has been calculated in accordance with FRS 22. Basic lossper share has been calculated by dividing the loss on ordinary activities beforetaxation by the weighted average number of ordinary shares in issue during theperiod. The weighted average number of equity shares in issue was 27,605,095 andthe loss was £653,897. The effect of all potential ordinary shares isantidilutive. 4 Share capital 2007 2007 2006 2006 £ Number £ NumberAuthorisedOrdinary shares of 10p each 5,000,000 50,000,000 5,000,000 50,000,000 ========== ========== ========== ======== 2007 2007 2006 2006 £ Number £ NumberAllotted, called up and fullypaidOrdinary shares of 10p each 2,760,510 27,605,095 2,760,510 27,605,095 ========== ========== ========== ======== 5 Reserves Share Profit Premium Merger and loss Account Reserve Account £ £ £GroupAt 1 October 2006 7,692,985 11,119,585 (20,694,729)Loss for the period - - (653,897) --------- --------- ----------At 31 March 2007 7,692,985 11,119,585 (21,348,626) ========= ========= ========== 6. Reconciliation of operating loss to net cash outflow from operating activities 2007 £ Operating loss (671,854)Depreciation 4,104Decrease in debtors 27,341Increase in creditors 140,052 ---------Net cash outflow from operating activities (500,357) ========= 7 Reconciliation of net cash outflow to movement in net funds 2007 £ Decrease of cash in period (490,282)Cash outflow from decrease in debt financing (3,063) ---------Movement in the period (493,345)Net cash at 1 October 2006 1,087,080 ---------Net cash at 31 March 2007 593,735 ========= 8 Analysis of net debt At 1 October Cash At 31 March 2006 Flow 2007 £ £ £ Cash at bank and in hand 1,221,181 (627,446) 593,735Bank overdrafts (134,101) 134,101 - --------- --------- ---------- 1,087,080 (493,345) 593,735 Debt due after one year (3,063) 3063 - --------- --------- ---------- Total 1,084,017 (490,282) 593,735 ========= ========= ========== 9 Post Balance Sheet Events In order to reduce management costs, Chief Executive, Andy Craig, has agreed toallow his existing service contract to be terminated as of 18 May 2007 but toremain on the Milestone Board serving as a non executive director. Separately,MGH Investments Limited, a consultancy company controlled by Andy Craig, hasbeen contracted to provide corporate finance advice to the Company until thecompletion of the group's strategic review. Similarly, the Company's Finance Director, Brian Chester, has agreed to allowhis existing service contract to be terminated as of 18 May 2007 but to remainon the Milestone Board serving in the capacity of part time Finance Director.Separately, ChesterBrown Limited, a company controlled by Brian Chester, hasbeen contracted to provide ongoing consultancy services to the Company until thecompletion of the group's strategic review. Under the terms of these compromise, consultancy and directorship arrangementsthe aggregate amount payable to Andy Craig and MGH Investments Limited is£155,000 and to Brian Chester and ChesterBrown Limited £121,000. These costshave been accrued for in the accounts to 31 March 2007 consistent with theBoard's expectation at that time. 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