Live Company Regulatory News (LVCG)

16 Aug 2006 07:00

PARALLEL MEDIA GROUP PLC RESULTS FOR THE YEAR ENDED 31 DECEMBER 2005 Chairman's statementThis year has been a time of challenges for Parallel Media Group Plc (`PMG')but has also witnessed a turnaround in its fortunes with the successfulconclusion of four new Title Sponsorships in its Asian business during the 2006PGA European Tour international's season.Since year end the company has agreed heads of terms for restructuring of itsAsian operations on a basis which the directors believe is beneficial to PMG.In addition PMG is in negotiation to raise funds of at least ‚£2 million whichwill be used to redeem certain of the Company's issued convertible loan stocks.A circular describing more of these matters will be sent to shareholdersshortly and approval of the resolutions necessary to issue shares for thesepurposes will be sought at an Extraordinary General Meeting.Key assetsPMG's business internationally is also set to expand, especially in Europe. PMGsees great potential in the FIFPro XI Awards, and its existing property inKazakhstan. Another area of activity that PMG has embarked on in 2006, is itsinvolvement in European Golf Resorts Limited. As previously announced, yourcompany is involved in negotiations for one venue in Havr (Croatia). PMG iscurrently also reviewing its contract with the PGA de las Americas regardingthe Tour de las Americas with the aim of making this contract potentiallyprofitable in 2007.It is your board's belief that the aforementioned developments which have beenachieved between the year end and today, significantly enhance your Company'slong term prospects.CorporateThe Company has also decided to restructure the Board to put the Company in thebest position for this coming period of growth. I will continue to spend aconsiderable portion of my time overseas developing the international aspectsof the business and will continue for the foreseeable future as chairman. I amdelighted to announce that Edward Adams who is chairman of RAM Investment Groupplc which is a significant holder of convertible loan stock in the company hasagreed to become a Non-Executive Director of the Company and that Leonard Finehas also agreed to become a Non Executive Director again. Both Edward andLeonard have worked closely with me over recent months and I have greatlyvalued their input so it is a pleasure to welcome them as directors. We willalso be looking to further strengthen the board over the forthcoming monthsThe board has decided that it would be appropriate for the business to have achief operating officer who would run the company on a day-to-day basis,relieving me of these duties and enabling me to apply my skills more fully toevent creation and sponsorship arrangement which will be the revenue generatorsfor the company in coming years. We have identified a suitable candidate withconsiderable experience in this field to take this role and are optimistic ofcompleting an agreement with him in the near future.OutlookThe last year has been a very significant period in the development of yourcompany. The current year has started well and I anticipate being able toannounce results for the first half of 2006 very shortly and that these willdemonstrate the improvement in trading. The changes with regard to our Asianactivities should enable this trend to be continued further and the plannedimprovements to the Group's balance sheet should enable the business to bedeveloped further and profitably.Without doubt this Company would not be in the position it is today without thetremendous support of its staff and shareholders and I thank them for theireffort and dedication.David Ciclitira.Chairman14 August 2006Financial reportOverview to 31 December 2005 In this year the Group shows a retained loss of ‚£1.05 million compared to aprior year loss of ‚£2.57 million. The adjusted loss per share figure for theyear was 4.71p, against a prior year adjusted loss per share figure of 10.98p. Turnover Group turnover for the year was ‚£2.58 million compared to turnover of ‚£2.98million in the prior year. Turnover reduced due to the cessation of the Group'sItalian operations and the expiration of a television rights contract, both ofthese activities had been loss making in 2004. These reductions in turnoverwere partially offset by the staging of two new Ladies European Tour golfevents in Asia and an increase in the commission generated from the Group'sassociated company Parallel Media Asia (2003) Ltd. Operating Loss After deducting rights fees and other direct costs from the Group's grossrevenues a gross profit of ‚£1.0 million was generated in the year. Theoperating loss equalled ‚£0.31 million which is an improvement of ‚£1.13 millionon the ‚£1.44 million recorded in the previous year. A major reason for thisimprovement is the reduction in the administration costs incurred by the group,especially in terms of staff and professional advisor costs. Exceptional ItemsDuring the year the Company disposed of an associated company, BroadcastInnovations Limited, this transaction resulted in a profit on sale of ‚£0.16million. The Company also disposed of a subsidiary company, Parallel MediaItalia SRL ("PMI"), the consideration for this disposal was the transfer to theCompany of certain sponsorship rights that PMI held. In calculating the loss ondisposal no value was attached to this consideration leading to an accountingloss on disposal of ‚£0.16 million.Net liabilitiesThe net liabilities of the Group at the year end are ‚£5.22 million, thisposition will be dramatically improved upon conversion of convertible loansowed by the Group and through the fund raising which the Group proposes toundertake.Interest and Taxation The Group paid net interest of ‚£0.36 million arising from convertible loaninterest, interest on the facility with Bumiputra Commerce Bank and otherloans.There was no corporation tax charge during the year. Loss Per Share Adjusted loss per share in the year was 4.71p compared to 10.98p in the yearended 31 December 2004. The adjusted loss as shown in Note 1 to the accountsis based upon the attributable profit of the continuing operations afteradjusting for goodwill and all exceptional items. At the end of this year, theCompany made no final dividend recommendation.Parallel Media Group plcConsolidated profit and loss account for the year ended 31 December 2005 Year ended Year ended 31 December 2005 31 December 2004 ‚£'000 ‚£'000 Turnover: Group and share of 2,582 3,702joint venture Less share of turnover of - (723)joint venture Turnover 2,582 2,979 Cost of Sales (1,593) (1,943) Gross Profit 989 1,036 Administrative Expenses (1,297) (2,474) Operating loss before (308) (1,288)exceptional items Administrative expenses - - (150)exceptional Operating Loss (308) (1,438) Share of operating loss in - (226)joint ventures Share of operating loss in (389) (672)associates Exceptional items - profit on 156 -sale of associated undertaking Exceptional items - loss on (157) 16disposal of subsidiary Loss on ordinary activities (698) (2,320)before interest and tax Interest receivable - 1 Interest payable (361) (397) Loss on ordinary activities (1,059) (2,716)before tax Tax on loss on ordinary - -activities Loss on ordinary activities (1,059) (2,716)after tax Minority interests 11 144 Loss for the financial year (1,048) (2,572) Loss per share - basic and diluted 1 (4.72p) (11.58p)Parallel Media Group plcStatement of total recognised gains and losses for the year ended 31 December 2005 Year ended Year ended 31 December 31 December 2005 2004 ‚£'000 ‚£'000 Loss for the financial year - Group (659) (1,674) - Joint ventures - (226) - Associated undertakings (389) (672) (1,048) (2,572) Currency translation differences on foreign currency net investments - Group (63) (7) - Joint ventures & associated undertakings (278) 150 Total recognised gains and losses for the year (1,389) (2,429)Parallel Media Group plcBalance sheets at 31 December 2005 Group Company 31 31 31 31 December December December December Note 2005 2004 2005 2004 ‚£'000 ‚£'000 ‚£'000 ‚£'000 Fixed assets Tangible assets 17 62 14 9 Investments 619 883 3,408 3,010 636 945 3,422 3,019 Current assets Debtors - Due within one 1,264 923 2,012 1,449 year - Due after one 805 1,890 802 1,890 year 2,069 2,813 2,814 3,339 Cash 107 47 105 - 2,176 2,860 2,919 3,339 Creditors: amounts falling due within one year (1,906) (2,003) (1,633) (1,447) Net current assets 270 857 1,286 1,892 Total assets less current 906 1,802 4,708 4,911liabilities Creditors: amounts falling due after one year: (6,130) (5,468) (6,130) (5,468) Provisions for liabilities and charges Associates - (156) - - Net liabilities (5,224) (3,822) (1,422) (557) Capital and reserves Called up share capital 2 1,110 1,110 1,110 1,110 Share premium account - - - - Other reserves 5,591 5,591 5,591 5,591 Profit and loss account (11,802) (10,413) (8,123) (7,258) Shareholders' funds - (5,101) (3,712) (1,422) (557)equity Minority interest - equity (123) (110) - - (5,224) (3,822) (1,422) (557)Parallel Media Group plcConsolidated cash flow statement for the year ended 31 December 2005 31 31 31 31 December December December December 2005 2005 2004 2004 ‚£'000 ‚£'000 ‚£'000 ‚£'000 Net cash outflow from (59) (2,404)operating activities Returns on investments and s ervicing of finance Interest paid (187) (397) Interest received - 1 Net cash outflow from (187) (396)returns on investments and servicing of finance Capital expenditure Payments to acquire tangible (9) (48) fixed assets Net cash outflow from (9) (48)capital expenditure and financial investment Acquisitions and disposals Further investment in - (158) associated undertaking Net (cash)/overdrafts sold (1) (242) with subsidiary Purchase of other - (30) investments (1) (430) Net cash outflow before (256) (3,278)management of liquid resources & financing Financing Bank facility (568) 1,562 Convertible loan 890 678 Loan from director - 514 322 2,754 Increase/(decrease) in cash 66 (524)Parallel Media Group plcNotes forming part of the financial statements for the year ended 31 December 20051. Loss per share Year ended Year ended 31 December 31 December 2005 2004 (i) Basic ‚£'000 ‚£'000 Loss for the financial year (1,048) (2,572) Number of shares in issue 22,203,505 22,203,505 Loss per share (4.72p) (11.58p)(ii) DilutedDiluted loss and earnings per share is calculated on the same basis as basicloss and earnings per share because the effect of the potential ordinary shares(share options and convertible loans) reduces the net loss per share and istherefore anti-dilutive.(iii) Adjusted earnings per shareThe adjusted earnings per share figure shown below is calculated onattributable loss excluding discontinued operations, exceptional items includedin administrative expenses, and exceptional items included after operatingprofit. This calculation has been used as it is deemed to give a moreappropriate indication of the earnings of the continuing operations of theGroup. Year ended Year ended 31 December 2005 31 December 2004 EPS Earnings EPS Earnings Pence ‚£'000 Pence ‚£'000 Basic loss per share (4.72p) (1,048) (11.58p) (2,572) Administrative expenses - - - 0.67p 150Exceptional (continuing operations only) Exceptional items (continuing 0.01 1 (0.07p) (16)operations only) Adjusted loss per share (4.71p) (1,047) (10.98p) (2,438)2. Called up share capital 31 31 December December 2005 2004 ‚£'000 ‚£'000 Authorised 1,799,533,475 ordinary shares of 0.5p each (31 December 8,998 9,9972004: 199,936,502 ordinary shares of 5p each) 199,831,545 deferred shares of 0.5p each (31 December 999 -2004: Nil) 9,997 9,997 Issued and fully paid 22,203,505 ordinary shares of 0.5p each (31 December 111 1,1102004: 22,203,505 ordinary shares of 5p each) 199,831,545 deferred shares of 0.5p each (31 December 999 -2004: Nil) 1,110 1,110(i) Ordinary shares and deferred sharesA re-organisation of the Company's capital was approved at an extraordinarygeneral meeting of the Company held on 2 August 2005. Every Ordinary Share of5p in issue was subdivided into one Ordinary Share of 0.5 pence each and nineDeferred Shares of 0.5 pence each. The deferred shares do not entitle theirholders to receive any dividend or other distribution, they do not entitletheir holders to receive notice of or to attend, speak or vote at any GeneralMeeting of the Company, and they do not entitle their holders on a return ofassets on a winding-up of the Company or otherwise only to the repayment of thecapital paid up on such Deferred Shares and only after repayment of the capitalpaid up on each Ordinary Share in the capital of the Company and the payment ofa further ‚£100,000 on each such Ordinary Share.The financial information set out above does not constitute the Company'sstatutory accounts for the year to 31 December 2005 but is derived from thoseaccounts.Copies of the Report and Accounts for the period ended 31 December 2005 arebeing sent to shareholders. Further copies will be available from the Company'sregistered office, which is 3-12 Harbour Yard, Chelsea Harbour, London, SW10OXD.ENDPARALLEL MEDIA GROUP PLC