INC.L Regulatory News (INC)

8 Feb 2008 09:50

Avanti Screenmedia Group PLC08 February 2008 8 February 2008 Avanti Screenmedia Group plc ("Avanti" or the "Company") AGM Statement Trading update New Contract Wins Avanti, the AIM quoted leading digital screenmedia specialist, announced attoday's AGM that all resolutions were duly passed. The Company made its preliminary statement of results on 6 December 2007 atwhich time it stated that national advertising sales across the Company hadperformed strongly during the first three months of the current financial year. Booked (gross) advertising sales already exceeded those achieved for the entire12 months to 30 June 2007. However, the softening of the retail markets duringthe run-up to Christmas reported at the time has continued into the New Yearwhich has led the Board to reduce its forecast anticipated rate of growth forthe remainder of the current financial year. The Company has renegotiated successfully the onerous terms of certain of itskey mall contracts which will benefit Avanti in the medium term. Similarcontract renegotiations are in hand with certain of the Company's other clientswhich, if successful, will provide the Company with a sound platform for furthergrowth. These negotiations are expected to be completed shortly. Despite these more challenging market conditions, the Company is continuing todevelop innovative and attractive media solutions for new and existing clients. Avanti is pleased to announce it has secured a contract with Bluewater, Europe'slargest shopping mall, to replace the existing digital media. Bluewaterattracts over 27 million visitors each year making it one of the UK's busiestshopping destinations. Avanti has now begun implementation of this contract,supplying screens and advertising content at a number of locations throughoutthe Mall. Avanti now has contracts with 34 malls with a combined annualaudience of over 433 million consumers. The Company also been awarded a three year contract as an official supplier tothe BBC's Motion Graphics for Factual Programming to supply 3D graphicanimations for both opening sequences and other programme requirements. The expansion of Avanti's business and the renegotiated retail contracts areboth factors that enhance the prospects and long-term profitability of theCompany. However, this also gives rise to an increase in the working capitalrequirement for the Company at a time when advertising rates and revenues areunder pressure throughout the industry. Costs at the Company have been reducedsignificantly in the last twelve months but the Company's financial resourcesremain limited. The Board confirms therefore that it will continue to seekfurther capital to secure the Company's future. The requirement is currentlyestimated at up to £2.0 million during the next twelve months. Mick Desmond, Chairman said: "Bluewater is a flagship shopping mall and in a competitive tender we aredelighted to have been selected as the provider of a high quality screen mediaadvertising product in keeping with this strong brand. The BBC contract winunderlines that Avanti is primarily a content-driven digital media company andis recognised as such by world renowned organisations. The Company also anticipates announcing further progress in renegotiating legacyrevenue guarantees with existing clients within the next few weeks. Despite more challenging market conditions the Company is making significantoperational improvements and achieving important new contract wins. In theevent that we are able to secure the further funding that the Company willrequire, Avanti should report further significant progress during the course ofthis year." Enquiries: Avanti Screenmedia Group plc 0207 902 2345Simon Rees, Chief ExecutiveGary Truman, Finance Director Charles Stanley Securities 020 7149 6000Nominated AdviserRussell Cook / Freddy Crossley Bishopsgate Communications Limited 020 7562 3355Jenni Herbert This information is provided by RNS The company news service from the London Stock Exchange