Last checked at 30 Jun 2009 12:30
30 June 2009
Zest Group plc
("Zest" or "the Group")
Interim Results
for the period ended 31 March 2009
Zest Group plc (AIM:ZEST), announces its interim results for the six months ended 31 March 2009.
During the period the Group made a loss before taxation of £113,000 (2008: loss £341,000). There was a loss per share from continuing operations of 0.01p (2008: loss per share 0.20p).
Current trading
During the period the Group has continued to seek to exploit the publishing and recording rights from Tara Chinn, Nasio Fontaine and Tony Fennell.
The Board is currently considering a proposed UK/European release for Tara Chinn's debut album "Night Racing" through an independent marketing company and expects to make a decision shortly.
Zest owns 100% of the recording and publishing rights of all five Nasio Fontaine's albums and is currently negotiating a new worldwide license deal. In addition, VP Records/Greensleeves will be releasing a "Best of" Nasio album with a DVD late in the summer of 2009. To support this release, Nasio is being asked to tour in the USA and Europe.
A songwriter and record producer signed to Zest, Tony Fennell, has a song on hold with Disney Records and has a number of other covers currently being considered by major record labels. Tony is also recording and writing an album with a mainstream female artist, who for legal reasons cannot be named at this time.
Whilst the Board continues to support these artists and is confident that the Group will receive some positive financial benefit from these relationships, in the current economic climate the quantum and timing of this benefit is subject to significant uncertainty. Accordingly, in order to take a prudent view of the prospects, the Board agreed to make a full provision against the recoverability of these amounts in the financial year to 30 September 2008.
Board changes
On 13 January 2009 Jon Crawley resigned from the Board to pursue other business interests. The Board would like to thank him again for his contribution to the Group.
Outlook
The Group will continue to seek to optimise the value of existing artists and where the opportunity arises, seek to add further rights by signing new artists and songwriters. In addition, Zest continues to look for potential acquisition opportunities and to explore alternative routes to securing shareholder value.
I would like to thank the staff and our shareholders for their continued support.
Richard Griffiths
Chairman
30 June 2009
ZEST GROUP PLC
UNAUDITED CONSOLIDATED INCOME STATEMENT
FOR THE PERIOD ENDED 31 MARCH 2009
| Note | Six months ended 31 March 2009 | Six months ended 31 March 2008 | Year ended 30 September 2008 | |
| £'000 | £'000 | £'000 | ||
| Administrative expenses | ||||
| - amortisation of intangibles | - | (10) | (20) | |
| - impairment of intangible assets | - | - | (78) | |
| - impairment of advance payments to artists | - | - | (533) | |
| - other administrative expenses | (117) | (285) | (469) | |
| Total administrative expenses | (117) | (295) | (1,100) | |
| Operating loss from continuing operations | (117) | (295) | (1,100) | |
| Finance costs | 4 | (46) | (180) | |
| Loss from continuing operations for the period before taxation | (113) | (341) | (1,280) | |
| Taxation expense | - | - | - | |
| Loss from continuing operations | (113) | (341) | (1,280) | |
| Loss from discontinued operations | - | (738) | (475) | |
| Loss for the period | (113) | (1,079) | (1,755) | |
| Basic and diluted loss per share from total operations | 4 | (0.01)p | (0.62)p | (1.01)p |
| Basic and diluted loss per share from continuing operations | 4 | (0.01)p | (0.20)p | (0.74)p |
| Basic and diluted loss per share from discontinued operations | 4 | - p | (0.42)p | (0.27)p |
ZEST GROUP PLC
UNAUDITED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 MARCH 2009
| Share capital | Share premium | Share based payment reserve | Retained earnings | Total equity | |
| £'000 | £'000 | £'000 | £'000 | £'000 | |
| At 1 October 2007 | 434 | 3,598 | 126 | (2,304) | 1,854 |
| Share based payment | - | - | 40 | - | 40 |
| Loss for the year | - | - | - | (1,755) | (1,755) |
| At 30 September 2008 | 434 | 3,598 | 166 | (4,059) | 139 |
| Share based payments | - | - | 11 | - | 11 |
| Loss for the period | - | - | - | (113) | (113) |
| At 31 March 2009 | 434 | 3,598 | 177 | (4,172) | 37 |
ZEST GROUP PLC
UNAUDITED CONSOLIDATED BALANCE SHEET
AS AT 31 MARCH 2009
| Note | 31 March 2009 | 31 March 2008 | 30 September 2008 | |
| £'000 | £'000 | £'000 | ||
| ASSETS | ||||
| Non-current assets | ||||
| Intangible assets | - | 88 | - | |
| Property, plant and equipment | 1 | 1 | 1 | |
| 1 | 89 | 1 | ||
| Current assets | ||||
| Trade and other receivables | 76 | 595 | 133 | |
| Cash and cash equivalents | 53 | 333 | 62 | |
| Total current assets | 129 | 928 | 195 | |
| Total assets | 130 | 1,017 | 196 | |
| EQUITY AND LIABILITIES | ||||
| Current liabilities | ||||
| Trade and other payables | 93 | 216 | 57 | |
| Total liabilities | 93 | 216 | 57 | |
| Equity | ||||
| Share capital | 5 | 434 | 434 | 434 |
| Share premium | 3,598 | 3,598 | 3,598 | |
| Share based payment reserve | 177 | 152 | 166 | |
| Retained earnings | (4,172) | (3,383) | (4,059) | |
| Equity shareholder's funds | 37 | 801 | 139 | |
| Total equity and liabilities | 130 | 1,017 | 196 |
ZEST GROUP PLC
UNAUDITED CONSOLIDATED CASH FLOW STATEMENT
FOR THE PERIOD 31 MARCH 2009
| Six months ended 31 March 2009 | Six months ended 31 March 2008 | Year to 30 September 2008 | ||
| £'000 | £'000 | £'000 | ||
| Operating activities Continuing activities | ||||
| Loss after taxation | (113) | (341) | (1,280) | |
| Finance costs | - | 49 | 187 | |
| Finance income | (4) | (4) | (7) | |
| Amortisation of intangibles | - | 10 | 20 | |
| Depreciation | - | - | 1 | |
| Impairment of intangible fixed assets | - | - | 78 | |
| Decrease in trade and other receivables | 57 | 46 | 608 | |
| Increase/(decrease) in trade and other payables | 36 | (164) | (323) | |
| Equity settled share based payments | 11 | 26 | 40 | |
| Net cash outflow from operating activities from continuing activities | (13) | (378) | (676) | |
| Discontinued operations | ||||
| Net cash inflow from operating actives from discontinued operations | - | 519 | 519 | |
| Total cash (outflow)/inflow from operating activities | (13) | 141 | (157) | |
| Investing activities Continuing activities | ||||
| Purchase of property, plant and equipment | - | - | (1) | |
| Finance cost | - | (49) | (49) | |
| Finance income | 4 | 4 | 7 | |
| Net cash inflow/(outflow) from investing activities | 4 | (45) | (43) | |
| Discontinued operations | ||||
| Net cash inflow from investing activities from discontinued operations | - | 1,866 | 2,029 | |
| Net cash inflow from investing activities | 4 | 1,821 | 1,986 | |
| Cash flow from financing activities | ||||
| Continuing operations | ||||
| Repayment of loans | - | (1,661) | (1,799) | |
| Net change in cash and cash equivalents | (9) | 301 | 30 | |
| Cash and cash equivalents at beginning of period | 62 | 32 | 32 | |
| Cash and cash equivalents at end of period | 53 | 333 | 62 |
ZEST GROUP PLC
NOTES TO THE INTERIM REPORT
FOR THE PERIOD ENDED 31 MARCH 2009
1 GENERAL INFORMATION
The financial information for the period ended 31 March 2009 does not constitute statutory accounts as defined in Section 240 of the Companies Act 1985. The figures for the year ended 30 September 2008 have been extracted from the 2008 statutory financial statements prepared under International Financial Reporting Standards as adopted by the European Union. The auditors' report on those accounts was unqualified and did not contain a statement under section 237(2) of the Companies Act 1985.
2 BASIS OF PREPARATION
This consolidated financial information for the six months ended 31 March 2009 has been prepared in accordance with IAS34, "Interim Financial Reporting" as adopted by the European Union. The half yearly consolidated financial report should be read in conjunction with the annual financial statements for the year ended 30 September 2008, which have been prepared in accordance with IFRS as adopted by the European Union.
This interim financial information has been prepared using the accounting policies set out in the Group's 2008 statutory accounts.
Copies of the interim results for the six months are being sent to all shareholders. A copy can also be found on the Company's website at www.zestmusic.com
3 SEGMENTAL REPORTING
(a) By business segment (Primary segment)
As defined under International Accounting Standard 14 (IAS 14) the only material business segment the Group has is that of music publishing and distribution.
(b) By Geographical Segment (Secondary segment)
Under the definitions contained in IAS 14 the only material geographic segment the Group operates in is the United Kingdom.
4 LOSS PER SHARE
The calculation of the loss per share is based on the loss attributable to ordinary shareholders divided by the weighted average number of shares in issue during the period.
| Six months ended 31 March 2009 | Six months ended 31 March 2008 | Year ended 30 September 2008 | |
| Loss for the period from total operations (£'000) | (113) | (1,079) | (1,755) |
| Weighted average number of 0.25p ordinary shares | 173,619,050 | 173,619,050 | 173,619,050 |
| Loss per share from total operations | (0.01)p | (0.62)p | (1.01)p |
| Loss for the period from continuing operations (£'000) | (113) | (341) | (1,280) |
| Weighted average number of 0.25p ordinary shares | 173,619,050 | 173,619,050 | 173,619,050 |
| Loss per share from continuing operations | (0.01)p | (0.20)p | (0.74)p |
| Loss for the period from discontinued operations (£'000) | - | (738) | (475) |
| Weighted average number of 0.25p ordinary shares | 173,619,050 | 173,619,050 | 173,619,050 |
| Loss per share from discontinued operations | -p | (0.42)p | (0.27)p |
The share options are anti-dilutive.
5 SHARE CAPITAL
| Unaudited 31 March 2009 | Unaudited 31 March 2008 | Audited 30 September 2008 | |
| £'000 | £'000 | £'000 | |
| Authorised | |||
| 4,000,000,000 ordinary shares of 0.25p | 10,000 | 10,000 | 10,000 |
| Allotted, issued and fully paid | |||
| 173,619,050 (31 March 2008 and 30 September 2008: 173,619,050) ordinary shares of 0.25p | 434 | 434 | 434 |
Enquiries:
| Steve Weltman, Chief Executive, Zest Group plc | +44 (0) 208 398 4144 |
| Tim Cofman/Nicola Rayner, W H Ireland Ltd | +44 (0) 121 265 6330 |