Last checked at 22 Sep 2014 07:00
Everyman Media Group plc
("Everyman" or the "Group")
Interim Results (unaudited) for the six-month period ended 30 June 2014
Highlights
· Revenue for the period up 15% to £6,212,000 (H1 2013: £5,380,000)
· Profit before tax up 20% to £220,000 (H1 2013 £183,000)
· Cash held at the end of the period was £8,541,000 (H1 2013: £1,919,000)
· The Group will be opening new sites at the Mailbox in Birmingham (early 2015) and Canary Wharf in London (mid 2015)
· The Group has also exchanged contracts for new sites in Bristol and Harrogate
Chairman's Statement
I am pleased to report on the Group's half year results for the six-month period ended on 30 June 2014, which have been prepared in accordance with International Financial Reporting Standards as adopted by the EU ("IFRS").
The Group achieved a profit after tax for the period of £139,000 (2013: £159,000).The Group's underlying operating profit before pre-opening expenses, exceptional items and share-based payments was £358,000 (2013: £297,000). Overall, the financial performance of the Group after all expenses and taxation is in line with the Board's expectations.
The effective tax rate is higher than the standard rate of corporation tax for the six-month period due to the effect of significant capital expenditure made by the Group part of which does not qualify for capital tax allowances or only qualifies for capital tax allowances at a reduced rate. The Group's effective tax rate is also affected by charges for share-based payments and fair-value movements in respect of the Group's derivative financial instruments.
The share-based payment expense for the period was £84,000 (30 June 2013: £10,000, 31 December 2013 £526,000) reflecting share option incentives provided to the Group's senior management and employees. The expense for the year ended 31 December 2013 included share-based payments becoming fully vested on achieving a quotation on AIM.
Review of the business
For the half year ended 30 June 2014, the Group received 0.82 per cent (2013: 0.70 per cent) of all box office revenues for cinemas in the United Kingdom (Source: Rentrak EDI). The Board continues to believe there is significant growth potential for an independent cinema chain within the UK.
The 'Everyman' brand continues to be positioned at the premium end of the UK cinema market and the Board remains confident that there is scope to increase box office sales, retail spend per customer and other revenue streams from its existing venues through general marketing, advertising and promotion of the 'Everyman' brand.
Results
Revenue for the half year ended 30 June 2014 was up 15% on last year to £6,212,000 (2013: £5,380,000).
The Board does not recommend the payment of a dividend at this stage of the Group's development.
Openings
In the period since the year end, the Group has acquired additional space adjacent to our existing site in Hampstead which has been used to expand the food offer.
The Group will be opening new sites at the Mailbox in Birmingham (early 2015), and Canary Wharf in London (mid 2015). The Group has also exchanged contracts for new sites in Bristol and Harrogate. There are a number of other sites which are already in the pipeline and at various stages of negotiation.
Cash flows
Cash flows from operating activities were £845,000 (2013: £2,241,000). Net cash outflow for the period before financing was £276,000 (2013: £1,657,000).
Cash held at the end of the period was £8,541,000 (2013: £1,919,000). The cash held will be invested in the continuing development and expansion of the Group's business in 2014 and into 2015.
Pre-opening costs
Pre-opening costs, which have been expensed within administrative expenses, were £54,000 (2013: £125,000). These costs include expenses, net of the effect of rent free periods, which are necessarily incurred in the period prior to a new unit being opened, but which are specific to the opening of that unit.
Current Trading
Since the year end trading has been in line with expectations and there remains a strong pipeline of new opportunities.
Board Changes
On 26th June 2014, the Company announced that Andrew Myers its Chief Executive would be leaving the business at the end of 2014. The Board would like to thank Andrew for his dedication and commitment. On 3 September 2014, the Company announced the appointment of Crispin Lilly, as its new Chief Executive Officer. Crispin is due to commence his position with Everyman before the end of the year.
Paul Wise
Chairman
22 September 2014
Consolidated statement of comprehensive income for the six-month period ended 30 June 2014 (unaudited)
| Six-month period ended | Six-month period ended | Year ended | ||
| 30 June 2014 | 30 June 2013 | 31 December 2013 | ||
| Note | £000 | £000 | £000 | |
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Revenue | 3 | 6,212 | 5,380 | 11,515 | |
Cost of sales | (2,423) | (2,270) | (4,699) | ||
Gross profit | 3,789 | 3,110 | 6,816 | ||
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Administrative expenses | (3,569) | (2,948) | (7,102) | ||
Exceptional items: | 4 |
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Accelerated share-based payment on listing | - | - | (250) | ||
IPO expenses | - | - | (282) | ||
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Total administrative expenses | (3,569) | (2,948) | (7,634) | ||
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Profit/(loss) from operations | 220 | 162 | (818) | ||
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Adjusted profit from operations (before exceptional items, pre-opening expenses, and share-based payment expense) | 358 | 297 | 365 | ||
Exceptional items (as above) | - | - | (532) | ||
Pre-opening expenses | (54) | (125) | (125) | ||
Share based payment expense | (84) | (10) | (526) | ||
Profit/(loss) from operations | 220 | 162 | (818) | ||
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Financial income |
| 36 | 63 | 120 | |
Financial expenses |
| (36) | (42) | (83) | |
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Profit/(loss) before taxation |
| 220 | 183 | (781) | |
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Income tax (expense)/credit | 5 | (81) | (24) | 77 | |
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Profit/(loss) for the period and total comprehensive income attributable to equity holders of the parent company | 139 | 159 | (704) | ||
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Basic earnings/(loss) per share - pence | 6 | 0.38 | 0.62 | (2.42) | |
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Diluted earnings/(loss) per share - pence | 6 | 0.38 | 0.61 | (2.42) |
All amounts relate to continuing activities.
There were no other recognised gains and losses in the period.
| Consolidated statement of financial position at 30 June 2014 (unaudited) | ||||
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| 30 June | 30 June | 31 December | |
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| 2014 | 2013 | 2013 |
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| £000 | £000 | £000 |
| Assets |
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| Non-current assets |
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| Property, plant and equipment |
| 8,765 | 8,079 | 7,988 |
| Goodwill |
| 782 | 782 | 782 |
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| 9,547 | 8,861 | 8,770 |
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| Current assets |
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| Inventories |
| 80 | 87 | 98 |
| Trade and other receivables |
| 704 | 429 | 510 |
| Cash and cash equivalents |
| 8,541 | 1,919 | 8,883 |
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| 9,325 | 2,435 | 9,491 |
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| Total assets |
| 18,872 | 11,296 | 18,261 |
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| Current liabilities |
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| Trade and other payables |
| 5,009 | 4,618 | 4,657 |
| Loans and borrowings |
| 76 | 359 | 76 |
| Current corporation tax liabilities |
| - | - | - |
| Total current liabilities |
| 5,085 | 4,977 | 4,733 |
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| Non-current liabilities |
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| Loans and borrowings |
| 224 | - | 254 |
| Derivative financial instruments |
| 181 | 242 | 195 |
| Deferred tax |
| 252 | 273 | 172 |
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| 657 | 515 | 621 |
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| Total liabilities |
| 5,742 | 5,492 | 5,354 |
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| Net assets |
| 13,130 | 5,804 | 12,907 |
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Equity and liabilities |
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Equity attributable to owners of the Company |
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Ordinary shares |
| 3,629 | 2,786 | 3,629 | |
Share premium |
| 5,774 | - | 5,774 | |
Merger reserve |
| 11,152 | 10,569 | 11,152 | |
Retained deficit |
| (7,425) | (7,551) | (7,648) | |
Total equity |
| 13,130 | 5,804 | 12,907 | |
Consolidated statement of changes in equity for the six-month period ended 30 June 2014 (unaudited) |
| Share | Share | Merger | Retained | Total |
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| capital | premium | reserve | deficit | equity |
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| £000 | £000 | £000 | £000 | £000 |
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At 1 January 2013 |
| 2,786 | - | 10,569 | (7,720) | 5,635 |
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Profit for the period |
| - | - | - | 159 | 159 |
Total comprehensive income for the period |
| - | - | - | 159 | 159 |
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Share-based payments |
| - | - | - | 10 | 10 |
Total contributions by owners of the parent |
| - | - | - | 10 | 10 |
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Balance at 30 June 2013 |
| 2,786 | - | 10,569 | (7,551) | 5,804 |
Profit for the period |
| - | - | - | (863) | (863) |
Total comprehensive income for the period |
| - | - | - | (863) | (863) |
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Shares issued in the period |
| 843 | 6,157 | - | - | 7,000 |
Share issue expenses |
| - | (383) | - | - | (383) |
Shares issued by subsidiary undertaking in the period |
| - | - | 583 | - | 583 |
Share-based payments |
| - | - | - | 766 | 766 |
Total contributions by owners of the parent | - | 843 | 5,774 | 583 | 766 | 7,966 |
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Balance at 31 December 2013 |
| 3,629 | 5,774 | 11,152 | (7,648) | 12,907 |
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Consolidated statement of changes in equity for the six-month period ended 30 June 2014 (unaudited) |
| Share | Share | Merger | Retained | Total |
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| capital | premium | reserve | deficit | equity |
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| £000 | £000 | £000 | £000 | £000 |
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Balance at 1 January 2014 |
| 3,629 | 5,774 | 11,152 | (7,648) | 12,907 |
Profit for the period |
| - | - | - | 139 | 139 |
Total comprehensive income for the period |
| - | - | - | 139 | 139 |
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Share-based payments |
| - | - | - | 84 | 84 |
Total contributions by owners of the parent |
| - | - | - | 84 | 84 |
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Balance at 30 June 2014 |
| 3,629 | 5,774 | 11,152 | (7,425) | 13,130 |
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Consolidated statement of cash flows for the six-month period ended 30 June 2014 (unaudited) | 30 June | 30 June | 31 December |
| 2014 | 2013 | 2013 |
| £000 | £000 | £000 |
Cash flows from operating activities |
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profit/(loss) from operations | 220 | 162 | (818) |
Depreciation | 380 | 285 | 671 |
Share-based payment | 84 | 10 | 776 |
| 684 | 457 | 629 |
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Decrease/(increase) in inventories | 18 | (20) | (31) |
(Increase)/decrease in trade and other receivables | (195) | 243 | 163 |
Increase in trade and other payables | 338 | 1,561 | 1,629 |
Net cash generated from operating activities | 845 | 2,241 | 2,390 |
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Cash flows from investing activities |
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Purchase of property, plant and equipment | (1,157) | (3,898) | (4,194) |
Interest received | 36 | - | 11 |
Net cash generated used in investing activities | (1,121) | (3,898) | (4,183) |
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Cash flows from financing activities |
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Proceeds from the issuance of ordinary shares | - | - | 7,000 |
Share issue expenses | - | - | (383) |
Repayment of bank borrowings | (30) | (42) | (401) |
Receipt of bank loans | - | - | 330 |
Proceeds from issuance of shares in subsidiary undertaking | - | - | 583 |
Interest paid | (36) | (12) | (83) |
Net cash generated from financing activities | (66) | (54) | 7,046 |
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Net (decrease)/increase in cash and cash equivalents | (342) | (1,711) | 5,253 |
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Cash and cash equivalents at the beginning of the period | 8,883 | 3,630 | 3,630 |
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Cash and cash equivalents at the end of the period | 8,541 | 1,919 | 8,883 |
1 | General information |
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| Everyman Media Group plc and its subsidiaries (together 'the Group') are engaged in the ownership and management of cinemas in the United Kingdom. Everyman Media Group plc (the Company) is a public company domiciled and incorporated in England and Wales (registered number 08684079). The address of its registered office is Studio 4, 2 Downshire Hill, London NW3 1NR. The Company was incorporated on 10 September 2013 for the purpose of becoming the new parent undertaking of the Group. |
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2 | Basis of preparation |
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| These condensed interim financial statements of the Group for the six months ended 30 June 2014 (the Period) have been prepared using accounting policies consistent with International Financial Reporting Standards (IFRSs) as adopted by the European Union. The same accounting policies, presentation and methods of computation are followed in the condensed set of financial statements as applied in the Group's latest audited financial statements for the year ended 31 December 2013. Amendments made to IFRSs since 31 December 2013 have not had a material effect on the Group's results or financial position for the six-month period ended 30 June 2014.
While the financial figures included within this half-yearly report have been computed in accordance with IFRSs applicable to interim periods, this half-yearly report does not contain sufficient information to constitute an interim financial report as set out in International Accounting Standard 34 Interim Financial Reporting.
These condensed interim financial statements have not been audited, do not include all of the information required for full annual financial statements, and should be read in conjunction with the Group's consolidated annual financial statements for the year ended 31 December 2013. The auditors' opinion on these Statutory Accounts was unqualified, did not draw attention to any matters by way of emphasis and did not contain a statement under s498(2) or s498(3) of the Companies Act 2006.
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3 | Revenue | 30 June | 30 June | 31 December |
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| 2014 | 2013
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| £000 | £000 | £000 |
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| Film and entertainment | 3,968 | 3,538 | 7,705 |
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| Food and beverages | 1,829 | 1,513 | 3,359 |
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| Other income | 415 | 329 | 451 |
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| 6,212 | 5,380 | 11,515 |
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4 | Exceptional items of expenditure | 30 June | 30 June | 31 December |
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| 2014 | 2013
| 2013
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| £000 | £000 | £000 |
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| Accelerated share-based payment on listing | - | - | 250 |
| IPO expenses | - | - | 282 |
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| - | - | 532 |
On 29 October 2013 the previous share option scheme within the Group, based upon ordinary shares within Everyman Media Holdings Limited, was accelerated on listing and a new share-incentive scheme put in place. The options related to the previous scheme were exercised, the vesting periods and the associated share-based payments expense being advanced.
On 7 November 2013 the Company was admitted to the AIM market and an associated placing of shares was made. The total costs were £665,000 of which £383,000 was attributed to share premium.
5 | Income tax | 30 June | 30 June | 31 December |
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| 2014
| 2013
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| £000 | £000 | £000 |
| Current tax (expense)/credit |
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| Current tax | - | - | - |
| Deferred tax: |
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| Origination and reversal of temporary differences | 81 | 24 | (77) |
| Total tax expense/(credit) | 81 | 24 | (77) |
The reasons for the difference between the actual tax charge for the period and the standard rate of corporation tax in the United Kingdom applied to profit/(loss) for the period is as follows:
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| 30 June | 30 June | 31 December |
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| 2014
| 2013
| 2013
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| £000 | £000 | £000 |
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| Profit/(loss) before tax | 220 | 183 | (781) |
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| Applied corporation tax rates: | 21.50% | 24.00% | 23.25% |
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| Tax at the UK corporation tax rate of 21.5%/24%/23.25% | 47 | 44 | (182) |
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| Expenses not deductible for tax purposes | 1 | (20) | 65 |
| Net effect of share options | 18 | - | (65) |
| Effect of change in tax rates | (18) | - | 9 |
| Under-provision in prior years | - | - | 106 |
| Effect of other timing differences | 33 | - | (10) |
| Total tax expense/(credit) | 81 | 24 | (77) |
6. | Earnings/(loss) per share | 30 June 2014 | 30 June 2013 | 31 December 2013 |
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| £000 | £000 | £000 |
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| Profit/(loss) used in calculating basic and diluted earnings/(loss) per share | 139 | 159 | (704) |
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| Number of shares |
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| Weighted average number of shares for the purpose of basic earnings per share | 36,291,024 | 25,560,136 | 29,128,127 |
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| Weighted average number of shares for the purpose of diluted earnings per share | 36,330,945 | 26,135,068 | 29,128,127 |
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| Basic earnings/(loss) per share (pence per share) | 0.38 | 0.62 | (2.42) |
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| Diluted earnings/(loss) per share (pence per share) | 0.38 | 0.61 | (2.42) |
Basic earnings per share amounts are calculated by dividing net profit/(loss) for the period attributable to ordinary equity holders of the parent by the weighted average number of ordinary shares outstanding during the period.
Where the Group has incurred a loss in a period the diluted earnings per share is the same as the basic earnings per share as the loss has an anti-dilutive effect. The diluted loss per share for 31 December 2013 is therefore the same as the basic loss per share for the period and the diluted weighted average number of shares is the same as the basic weighted average number of shares.
The Company has 3,296,441 potentially issuable shares all of which relate to the potential dilution from the Group's 'A' shares and share options issued to the Directors and certain employees under the Group's incentive arrangements.