IME.L Regulatory News (IME)

23 Aug 2006 07:01

Immedia Broadcasting plc23 August 2006 23 August 2006 IMMEDIA BROADCASTING PLC INTERIM RESULTS Immedia Broadcasting PLC, the UK's leading provider of live, tailored in-storemedia, today announces its interim results for the six months to 30 June 2006. Highlights • Underlying* revenue up 19.4% to £1.43m (2005: £1.20m); total revenue up 48.7% to £2.29m (2005: £1.54m) • Underlying* gross profit up 35.4% to £0.80m (2005: £0.59m); total gross profit up 77.9% to £1.51m (2005: £0.85m) • Improvement in underlying* loss before interest and taxation -£0.48m (2005: £0.55m). Total profit before tax for the period of £0.13m (2005 loss: -£0.27m). • Excellent cost and cash management • The business continues to be cash generative following the acquisition of The Cube Group of Companies ('Cube') with net debt of £0.35m at period end • 'Impulse Live' delivering in line with expectations following recent strategic change • New tailored station for Irish convenience stores continuing to roll out as planned through our contract with Alphyra • 'HSBC Live' successfully rolled out to 450 branches • 'IKEA Live' continuing to be rolled out as further IKEA stores open throughout the UK • Cube acquisition integrating successfully * The underlying figures refer to revenue and profit numbers excluding therecent acquisition of Cube and non-recurring revenues linked to the terminatedcontract with Vitus announced in November 2005. Commenting on the results Bruno Brookes, Chief Executive, said: "Immedia has made solid progress for the first six months of the year. We haveachieved good results with all our current radio stations and are pleased withthe integration of Cube. We have a very strong management team with blue chip clients and are unrivalledboth in terms of our live radio and visual offering. We are seeing encouragingorganic growth from existing clients and continue to negotiate longer termcontracts to increase our earnings visibility. The business has a promising pipeline of new opportunities and we are confidentof meeting market expectations for the full year." Immedia Broadcasting PlcBruno Brookes, Chief Executive 01635 572 800Charles Barker-Benfield, Finance Director Hudson SandlerSandrine Gallien / Amy Faulconbridge 020 7796 4133 Chairman's Statement Overview The results from the last six months have been encouraging. In a challengingadvertising market, particularly for radio, Immedia has continued to makeprogress. Our outsourced sales team is now fully operational and performingwell. In addition, increased revenues from existing clients have driven organicgrowth and costs have been managed efficiently, pushing Immedia further towardsprofitability for the full year. The recent acquisition of Cube announced in April 2006 is creating an additionalplatform for us and we are looking forward to building on our broadened offer. Financial Review Underlying revenue for the first half was £1.43m, an increase of 19.4% comparedto the same period last year (2005: £1.20m) generating an underlying grossprofit of £0.80m (2005: £0.59m) and an improvement in underlying loss beforeinterest and taxation of £0.07m to - £0.48m (2005: -£0.55m). Profit before tax for the period is £0.13m compared to a loss of -£0.27m in2005. The business is cash generative and has a reported net debt of £0.35m as at 30June 2006, including £0.70m of deferred consideration relating to theacquisition of Cube. Outlook Immedia's unique media solutions continue to appeal to a broad range ofbusinesses. The success for the half-year and the strengthened management teamleave us in a strong position to continue Immedia's expansion. We are continuing to trial new subscription radio channels as well asRadioVision, Immedia's latest product where live radio triggers tailored videocontent, with high street brands, and remain confident of a positive outcome forthe full year. Geoff Howard-Spink Chairman 23 August 2006 Consolidated Profit and Loss Account Note Unaudited Unaudited Half year Half Year Year Ended 30 June 06 30 June 05 31 Dec 05 £ £ £ Turnover 8 2,294,464 1,543,388 3,007,688 Cost of sales (780,034) (692,120) (1,308,281) Gross profit 1,514,430 851,268 1,699,407 Administrative expenses (1,389,292) (1,138,377) (2,771,144) Operating profit/(loss) 125,138 (287,109) (1,071,737) Operating profit before depreciation, amortisation, 658,409 51,397 73,391impairment charge and interestDepreciation and amortisation (533,271) (338,506) (699,279)Impairment charge - - (445,849)Net interest receivable 3,457 13,838 20,321 Interest receivable and similar income 14,951 23,428 37,817Interest payable and similar charges (11,494) (9,590) (17,496) Profit/(loss) on ordinary activities before 128,595 (273,271) (1,051,416)taxation Tax on loss on ordinary activities 6 - - - Profit/(loss) for the period 128,595 (273,271) (1,051,416) Earnings/(loss) per share - basic 7 0.99p (2.45)p (9.43)pEarnings/(loss) per share - diluted 7 0.98p (2.45)p (9.43)p The results for the half year to 30th June 2006 include the results for The CubeGroup of Companies from 8 May 2006 until the end of the period, amounting to£246,000 of turnover and £5,000 of operating loss. Consolidated Balance Sheet Note Unaudited Unaudited as at as at As at 30 June 06 30 June 05 31 Dec 05 £ £ £ Fixed assetsIntangible assets 9 2,234,752 54,952 36,637Tangible assets 11 867,865 1,687,574 1,155,712 3,102,617 1,742,526 1,192,349 Current assetsDebtors 12 1,461,093 826,247 866,422Cash at bank and in hand 481,487 1,008,261 838,452 1,942,580 1,834,508 1,704,874 Creditors: amounts falling due within one year 13 (2,396,397) (921,390) (1,217,614) Net current (liabilities)/assets (453,817) 913,118 487,260 Total assets less current liabilities 2,648,800 2,655,644 1,679,609 Creditors: amount falling due after more than 14 (232,071) (200,000) -one yearProvisions for liabilities and charges - (10,000) - Net assets 2,416,729 2,445,644 1,679,609 Capital and reservesCalled up share capital 15 1,334,831 1,170,791 1,173,897Share premium account 15 3,532,696 3,372,960 3,390,411Shares to be issued 15 305,306 - -Merger reserve 15 2,245,333 2,245,333 2,245,333Profit and loss account 15 (5,001,437) (4,343,440) (5,130,032) Equity shareholders' funds 2,416,729 2,445,644 1,679,609 Consolidated Cash Flow Statement Note Unaudited Unaudited Half Year to Half Year to Year Ended 30 June 06 30 June 05 31 Dec 05 £ £ £ Cash inflow from operating activities 1 737,416 389,795 464,524 Return on investments & servicing of financeInterest received 14,951 23,428 37,817Interest paid (11,494) (9,590) (17,496)Net cash inflow from return on investments & 3,457 13,838 20,321servicing of finance TaxationCorporation tax paid - - - Capital expenditure & financial investmentPayments to acquire tangible fixed assets (143,700) (217,533) (473,978)Payments to acquire shares for EBT - (6,838) -Proceeds from sales of tangible fixed assets - 110 500Net cash outflow on capital expenditure & (143,700) (224,261) (473,478)financial investment AcquisitionsPurchase of subsidiary undertaking (2,379,449) - -Cash and bank balances acquired 204,236Net cash outflow on acquisitions (2,175,213) - - Net cash (outflow)/inflow before management ofliquid resources and financing (1,578,040) 179,372 11,367 Management of liquid resourcesCash withdrawn from short term deposit 790,000 - 210,000 FinancingRepayment of other loans (141,227) (50,000) (50,000)New other loans 700,000 - -Purchase of own shares for Immedia Employee - - (6,865)Benefit TrustIssue of ordinary share capital 326,531 - -Conditional shares to be issued 305,306 - -Share issue costs (taken against share premium - - (10,498)account)Effect of adoption of FRS 25 on 1 January 2005 - - 28,253(with 2004 not restated)FRS 25 revaluations of other loans (23,312) - - Net cash inflow/(outflow) from financing 1,167,298 (50,000) (39,110) Increase in cash in the period 379,258 129,372 182,257 Reconciliation of net cash flow to movement in net funds Note Unaudited Unaudited Half Year to Half Year to Year Ended 30 June 06 30 June 05 31 Dec 05 £ £ £ Increase in cash in the period 379,258 129,372 182,257Cash outflow from decrease in liquid resources (790,000) - (210,000)Cash (outflow)/inflow from (increase)/decrease in (587,190) 50,000 44,382debt Movement in net (debt)/funds in the period (997,932) 179,372 16,639Net funds at the start of the period 643,497 626,858 626,858 Net (debt)/funds at the end of the period 2 (354,435) 806,230 643,497 Notes to the Cash flow statement 1. Reconciliation of operating profit (loss) to net cash flow from operating activities Unaudited Unaudited Half Year to Half Year to Year Ended 30 June 06 30 June 05 31 Dec 05 £ £ £ Operating profit/(loss) 125,138 (287,109) (1,071,737)Depreciation and amortisation of tangible and intangible assets 533,271 338,506 1,145,128(Profit)/loss on disposal of fixed assets - (110) 500Decrease/(increase) in debtors (803,080) 299,357 259,182Increase in creditors 882,087 39,151 132,451 Net cash inflow from operating activities 737,416 389,795 464,524 2. Analysis of changes in net funds/(debt) 31 Dec 05 Cash Flow 30 June 06 £ £ £ Cash at bank and in hand 48,452 433,035 481,487Overdrafts (6,588) (53,777) (60,365) 41,864 379,258 421,122 Loans - short term position (188,367) (355,119) (543,486)Loans - long term position - (232,071) (232,071)Cash on deposit 790,000 (790,000) - Net funds/(debt) 643,497 (997,932) (354,435) Notes to the Interim Results 3. Basis of preparation The accounts of the company for the six months ended 30 June 2006, which areunaudited, were approved by the board on 22 August 2006. They have beenprepared under the historical cost accounting rules and in accordance withapplicable accounting standards. The results contained in this statement do notconstitute statutory accounts as defined in section 240 of the Companies Act1985. 4. Merger accounting On the 20 November 2003 a new holding company was brought into the group. Thiswas carried out by a share for share exchange and the existing shareholders ofImmedia Broadcast Ltd received 1,000 10p Ordinary shares in Immedia BroadcastingPlc for every share held. There was no cash consideration. This group reconstruction has been accounted for as a merger as permitted by FRS6 acquisitions and mergers. Following these principles the entities arecombined. This transaction qualifies under section 131 of the Companies Act1985, which exempts the parties from creating a share premium on thistransaction. The difference between the investment value carried in ImmediaBroadcasting Plc and the capital base of Immedia Broadcast Ltd is taken to amerger reserve. Under the merger method, subsidiaries acquired are included asif they had always been members of the group. 5. Employee Benefit Trust (EBT) Group accounts for the current year and the comparative figures include an EBTin accordance with UITF 38. The cost of shares in Immedia Broadcasting Plcpurchased on behalf of the Trust has been debited to reserves. 6. Taxation During the period, the Group made taxable profits before capital allowances(losses to 30 June and 31 December 2005), which have been offset againstaccumulated tax losses brought forward. The residual trading losses create adeferred tax asset of £1,143,000 (31 December 2005: £1,173,000) which has notbeen recognised due to the uncertainty of the timing of its eventualcrystallisation. 7. Earnings/(loss) per share Earnings/(loss) per share is based on the earnings after tax of £128,595 (30June 2005: loss of £273,271; 31 December 2005: loss of £1,051,416) divided bythe weighted average number of Ordinary shares in issue in each of the relevantperiods; 30 June 2006: 12,969,563 shares (30 June and 31 December 2005:11,144,410 shares). The diluted earnings per share is based on 13,093,010 shares for the period toJune 2006. For 30 June and 31 December 2005, the diluted basic loss per shareis stated as the same amount as basic as there is no dilutive effect from thecurrent share options, warrants and convertible loan notes in accordance withFRS 22. 8. Turnover Turnover represents the amount invoiced by the Group for goods and servicesprovided in the normal course of business, excluding value added tax. 9. Intangible fixed assets Unaudited Unaudited as at as at As at 30 June 06 30 June 05 31 Dec 05 £ £ £ GoodwillCostAt beginning of period 109,900 109,900 109,900Acquisitions 2,230,317 - -At end of period 2,340,217 109,900 109,900 Accumulated amortisationAt beginning of period (73,263) (36,633) (36,633)Charge for period (32,202) (18,315) (36,630)At end of period (105,465) (54,948) (73,263) Net Book Value 2,234,752 54,952 36,637 10. Acquisitions Fair value Book values adjustments As adjusted £ £ £ Net assets acquiredTangible fixed assets 426,254 (361,999) 64,255Debtors 435,915 - 435,915Cash at bank and in hand 102,286 - 102,286Creditors (424,905) - (424,905)Loans and finance leases (28,419) - (28,419) 511,131 (361,999) 149,132Goodwill 2,230,317 2,379,449 Satisfied byShares allotted 326,531Conditional shares to be issued 305,306Cash 1,747,612 2,379,449 The subsidiary undertaking acquired during the period contributed £(101,950) tothe group's net operating cash flows, paid £294 in respect of net returns oninvestments and servicing of finance, paid £nil in respect of taxation andutilised £nil for capital expenditure. 11. Tangible fixed assets Plant and Fixtures and Network Total machinery fittings equipment £ £ £ £ CostAt 1 January 2006 615,366 245,852 2,378,993 3,240,211Additions 3,800 21,497 118,403 143,700Acquisitions 18,747 102,273 - 121,020 At 30 June 2006 637,913 369,622 2,497,396 3,504,931 DepreciationAt 1 January 2006 441,317 153,773 1,489,409 2,084,499Charge for period 63,612 34,050 403,407 501,069Acquisitions 6,738 44,760 - 51,498 At 30 June 2006 511,667 232,583 1,892,816 2,637,066 Net book valueUnaudited at 30 June 2006 126,246 127,039 604,580 867,865 At 31 December 2005 174,049 92,079 889,584 1,155,712 Unaudited at 30 June 2005 221,272 87,900 1,378,402 1,687,574 12. Debtors - amounts falling due within one year Unaudited Unaudited as at as at As at 30 June 06 30 June 05 31 Dec 05 £ £ £ Trade debtors 1,089,078 507,579 472,862Other debtors and prepayments 372,015 318,668 393,560 1,461,093 826,247 866,422 13. Creditors - amounts falling due within one year Unaudited Unaudited as at as at As at 30 June 06 30 June 05 31 Dec 05 £ £ £ Bank overdrafts 60,365 2,031 6,588Bank loans 14,250 - -Other loans 522,139 - 188,367Finance leases 7,097 - -Trade creditors 758,432 399,038 396,683Other creditors including taxation & social security 128,328 29,850 66,048Accruals and deferred income 905,786 490,471 559,928 2,396,397 921,390 1,217,614 Other loans comprise £475,000 in relation to the acquisition of The Cube Groupof Companies Limited (repayable in instalments of £250,000 on 31 October 2006and £225,000 on 30 April 2007 and bearing interest at a fixed rate of 8% perannum) and £50,000 for an unsecured convertible loan from Horrocks GuardianLimited, bearing interest at a fixed rate of 8% per annum and repayable on 19September 2006. The carrying value of the Horrocks Guardian loan is included at£47,139 following revaluation under FRS 25. 14. Creditors - amounts falling due after more than one year Unaudited Unaudited as at as at As at 30 June 06 30 June 05 31 Dec 05 £ £ £ 232,071 200,000 - This comprises £225,000 of deferred consideration for the acquisition of TheCube Group of Companies Limited, repayable on 31 October 2007 and bearinginterest at a fixed rate of 8% per annum, £6,980 for two DTI loans granted toThe Cube Group of Companies Limited under the Small Firms Loan Guarantee Schemebearing interest at LIBOR plus 2.5% and repayable on a monthly basis up toAugust 2008, and £91 of finance lease liabilities. 15. Reserves Reserves as at 30 June 2006 Merger Share Share Shares Profit reserve capital premium To be & loss account £ £ £ issued £ £ Beginning of period 2,245,333 1,173,897 3,390,411 - (5,130,032)Retained profit for the - - - - 128,595periodReleased on repayment - (2,331) (20,981) - -of Other loan under FRS 25New shares issued - 163,265 163,266 - -Conditional shares to - - - 305,306 -be issuedEnd of Period 2,245,333 1,334,831 3,532,696 305,306 (5,001,437) Reserves as at 31 December 2005 Merger reserve Share capital Share premium Profit £ £ £ & loss account £ Beginning of period 2,245,333 1,170,791 3,372,960 (4,063,331)Retained loss for the year - - - (1,051,416)Liabilities classified as shares - 3,106 - -Effect of adoption of FRS 25 on 1 January - - 34,919 (10,546)2005 (with 2004 not restated) Released on repayment of Other loan under - - (6,970) 2,126FRS 25 Share issue costs - - (10,498) -Purchase of own shares for Employee Benefit - - - (6,865)Trust End of Period 2,245,333 1,173,897 3,390,411 (5,130,032) This information is provided by RNS The company news service from the London Stock Exchange