Last checked at 26 Sep 2012 17:54
26th September 2012 PARALLEL MEDIA GROUP PLC ("PMG" OR THE "GROUP") INTERIM RESULTS FOR THE 6 MONTHS ENDED 30 JUNE 2012
Parallel Media Group Plc (AIM:PAA), a leading sports marketing, media and digital agency, announces its interim results for the six months ended 30th June 2012.
Highlights
* Successfully promoted and delivered the Ballantine's Championship, the largest golf tournament in South Korea with a record attendance of over 45,000 people * Promoted first K-Pop concert (Shinhwa) in Singapore * Raised £500,000 at 35p to create and grow the Singapore based business * Turnover of £5.48m * Gross profit of £1.28 million * Operating profit of £248,000 * Net profit after tax of £88,000
Post Period Highlights:
* Promoted second K-Pop concert (Wonder Girls) in Singapore * Signed a contract with the International Judo Federation * Signed a contract to promote the Korean LPGA golf tournament, ADT Caps, to be held in Singapore on 15th November 2012
Chairman of PMG, David Ciclitira, commented:
"The first six months of this year have been a positive period for Parallel Media Group plc, as we have continued to expand the existing business in Asia at the same time as developing new business based around our offices in Seoul and Singapore. Examples of this are the promotion of two K-Pop concerts and the innovative move of the final Korean LPGA event, the ADT Caps, from Seoul to Singapore."
"I am pleased to announce the appointment of Jin Wei Toh and Martin Capstick as Managing Directors responsible for the Asian business (PMGA) heading up Sales and Operations in Asia respectively.
"I am very conscious of the support of our directors, staff and above all shareholders and would like to take this opportunity to thank them all."
Contact Details
For more information please contact:
Parallel Media Group PlcDavid Ciclitira +44 (0) 20 7225 2000Chairman Northland Capital Partners Limited +44 (0) 20 7796 8800Edward Hutton, Luke Cairns Bishopsgate Communications +44 (0)20 7562 3350Nick Rome/Sam Allen/Matt Low pmg@bishopsgatecommunications.com www.parallelmediagroup.com CHAIRMAN'S STATEMENTOverview
The first six months of this year has been a positive period for Parallel Media Group plc.
Asia
We have continued to expand the existing business in Asia at the same time as developing new business based around our offices in Seoul and Singapore. This is illustrated by the promotion of two K-Pop concerts in June and September in Singapore and the innovative move this November, from Seoul to Singapore, of the final 2012 Korean LPGA tournament, the ADT Caps.
Europe
We have refocused our European operations around Parallel Smart Media, and the development of a new joint venture in Milan, concentrating on opportunities brought about by Expo 2015.
In this period under review and subsequently PMG has:
* Successfully promoted and delivered the Ballantine's Championship, the largest golf tournament in South Korea, with a record attendance of over 45,000 people * promoted two K-Pop concerts (Shinhwa and Wonder Girls) in Singapore * Raised £500,000 at 35p to create and grow the Singapore based business * Signed a representational contract with the International Judo Federation * Signed a contract to promote the Korean LPGA golf tournament, ADT Caps, to be held in Singapore on 15th November 2012
Financial Review
The Company's main focus during the first six months of 2012 has been to develop its new sales infrastructure based in Singapore.
Turnover for the six months to 30 June 2012 was £5.48m.
The operating profit before exceptional items for the six months to June 30 2012 was £248,000, this operating profit is after deducting approximately £ 125,000 of one off set up costs for the Singapore operation.
The exceptional item reflects the payment of creditors from 2011 by issuing shares in the Company.
The Net Asset Value has increased from £376,000 to £1,183,000, reflecting the raising of additional capital through the issue of 2,892,595 shares.
At the end of April 2012 PMG raised a further £500,000 at 35p per share of which £300,000 has subsequently been lent to the PSMA Alpha Entertainment (a joint venture company set up to promote K-Pop in Singapore), and the majority of the remaining amount has been invested in the start up of the Singapore operations.
Senior Management Appointments
To capitalise on its expanding business in Asia, PMG today announces the appointment of Jin Wei Toh and Martin Capstick as Managing Directors responsible for the PMG's Asian business, heading up Sales and Operations respectively. It is hoped that these appointments will allow me, as Executive Chairman, to spend more time on the development of the Group. As part of this restructure, the company has streamlined its UK operations through the outsourcing of the financial function. Additionally the company is reviewing its statutory structure to eliminate underlying minority interests and potential conflicts of interests.
Going forward
At the same time as making special mention of the Company's Board and Staff worldwide, I would like to take this opportunity to thank all our stakeholders.
As your Chairman I truly feel positive about the next 18 months.
I remain committed to improving shareholder communication and look forward to both sharing with you various announcements this forthcoming quarter, and meeting you at the AGM at 9am on the 29th October at our offices in London.
David CiclitiraChairman26th September 2012
CONSOLIDATED INCOME STATEMENT
FOR THE SIX MONTHS ENDED 30 JUNE 2012
Notes 6 months 6 months 12 months to to to 31 30 June 30 June December 2012 2011 2011 unaudited unaudited audited £'000 £'000 £'000 Continuing operations Revenue 5,475 6,013 6,417 Cost of Sales (4,191) (4,397) (4,420) Gross Profit 1,284 1,616 1,997 Administrative Expenses (924) (1,154) (1,920) Foreign Exchange (32) 62 31 Earnings before interest, tax, 328 524 108depreciation and amortisation Depreciation and Amortisation of (80) (83) (225)intangibles Operating Profit / (Loss) 248 441 (117) Exceptional items (100) - (101) Finance cost (34) (45) (111) Share of post acquisition loss of (26) - (46)Joint Venture Profit/ (Loss) on ordinary 88 396 (375)activities before tax Taxation - - - Profit/(Loss) for the period 88 396 (375) Attributable to: Non-controlling Interests (110) - - Equity Holders of the parent 198 396 (375) 88 396 (375) Earnings per share 4 Basic 0.9p 2.6p (2.2p) Diluted 0.9p 2.6p (2.2p)
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTHS ENDED 30 JUNE 2012
6 months 6 months 12 months to to to 31 30 June 30 June December 2012 2011 2011 unaudited unaudited audited £'000 £'000 £'000 Profit / (Loss) for the year 88 396 (375) Other comprehensive income Exchange difference on translation of - 25 29foreign operations Tax effect of changes in other comprehensive income Total comprehensive income for the 88 421 (346)year Total comprehensive income attributable to: Equity holders of the parent 198 417 (350) Non-controlling interest (110) 4 4 88 421 (346)
CONSOLIDATED BALANCE SHEET
AS AT 30 JUNE 2012 Notes 30 June 30 June 31 December 2012 2011 2011 unaudited unaudited audited £'000 £'000 £'000 Non-current assets Property, Plant & Equipment 9 3 1 Intangible Assets 1,934 2,070 2,002 Development Costs 850 294 219 Investment in Joint Venture - - 1,319 Investments 12 12 12 Goodwill on consolidation 1,267 - - Total non-current assets 4,072 2,379 3,553 Current Assets Trade Receivables 1,312 1,898 1,917 Cash 78 186 22 Total current assets 1,390 2,084 1,939 Current Liabilities: Financial Liabilities - 6 250 250 250borrowings Financial Liabilities - loans 7 - 39 - Trade & Other payables 3,487 3,602 3,845 Total current liabilities 3,737 3,891 4,095 Net current assets/ (2,347) (1,807) (2,156)(liabilities) Non- current liabilities 8 (542) (750) (667) Financial borrowings Deferred Tax - - (354) Total non current liabilities (542) (750) (1,021) Net Assets 1,183 (178) 376 Equity Share Capital 9 3,527 3,362 3.463 Share premium 7,259 5,429 6,653 Other reserves 557 557 557 Capital redemption reserve 5,034 5,034 5,034 Foreign translation reserve 13 13 13 Retained earnings (15,012) (14,439) (15,210) Total Equity 1,378 (44) 510 Minority Interest (195) (134) (134) Equity attributable to equity 1,183 (178) 376holders of the parent
CONSOLIDATED CASH FLOW STATEMENT
FOR THE SIX MONTHS ENDED 30 JUNE 2012
30 June 30 June 31 December 2012 2011 2011 unaudited unaudited audited £'000 £'000 £'000 Cash flows from operating activities Operating Profit / (Loss) 148 441 (218) Depreciation - 3 5 Amortisation of intangibles - 68 68 136Tournament rights Amortisation of intangibles - 12 12 87development costs Decrease in debtors 605 (509) (936) Increase/(Decrease) in creditors (712) 45 289 Foreign exchange on non-operating - (27) 4activities Increase in translation reserve - 29 25 Cash generated from operating 121 62 (608)activities Cash flow from investing activities Investment in joint ventures (406) - - Net cash used in investing activities (406) - - Cash flow from financing activities Repayments of bank facility - - 146 Convertible loans repaid - - (39) Cash proceeds from issue of new 500 721shares Loan repaid (125) - (229) Interest paid (34) (45) (111) Net cash used in financing activities 341 (45) 488 Cash and cash equivalents at 22 142 142beginning of the year Exchange (loss) / gains on cash and - 27 -cash equivalents Net (decrease)/increase in cash and 56 17 (120)cash equivalents Cash and cash equivalents at end of 78 186 22the period
CONSOLIDATED CHANGES IN EQUITY
FOR THE SIX MONTHS ENDED 30 JUNE 2012
Non Capital con- Share Share Other redemption Forex Retained Sub trolling Capital Premium reserves reserve reserve earnings total interest Total At 1 3,463 6,653 557 5,034 13 (15,210) 510 (134) 376January 2012 Profit for - - - - - 198 198 (110) 88the period Share issue 64 606 - - - - 670 - 670 Arising on - - - - - - - (49) (49)acquisition of Parallel Smart Media Ltd At 30 June 3,527 7,259 557 5,034 13 (15,012) 1,378 (195) 1,1832012
The table below sets out the movements in reserve for the six months ended 30 June 2011
Non Capital con- Share Share Other redemption Forex Retained Sub trolling Capital Premium reserves reserve reserve earnings total interest Total At 1 3,362 5,429 557 5,034 (12) (14,835) (465) (138) (603)January 2011 Profit 396 396 396for the period Foreign 25 25 4 25exchange At 3,362 5,429 557 5,034 13 (14,439) (44) (134) (178)30 June 2011
NOTES TO THE FINANCIAL INFORMATION
1. Basis of Preparation
The condensed financial statements have been prepared using accounting policies consistent with International Financial Reporting Standards.
The condensed consolidated Interim Financial Statements should be read in conjunction with the annual financial statements for the year ended 31 December 2011, which have been prepared in accordance with International Financial Reporting Standards. The comparative figures shown for the year ended 31 December 2011 do not constitute statutory accounts as they have been extracted from the statutory accounts which have been filed with the Registrar of Companies. These interim results are unaudited and do not constitute statutory accounts.
2. Significant Accounting Policies
The condensed financial statements have been prepared under the historical cost convention. The same accounting policies, presentation and method of computation are followed in these condensed financial statements as were applied in the preparation of the Group's financial statements for the year ended 31 December 2011.
3. Segment Information The group is organised into two main divisions Event Promotion and Consultancyand Sales. The Event Promotion operates professional golf tournaments in Asiawhich are Sanctioned by the European Tour and Ladies European Tour. TheConsultancy and Sales division is based in the London headquarters and workswith major international brands, sports federations and tourist boards onsports and lifestyle projects, brand development, sales and marketingopportunities. Event Promotion Sales & Consolidated Asia Consultancy Europe 6 months 6 months 6 months 6 months 6 months 6 months to to to to to to 30 June 30 June 30 June 30 June 30 June 30 June 2012 2011 2012 2011 2012 2011 £'000 £'000 £'000 £'000 £'000 £'000 Group Revenue 5,408 5,556 67 420 5,475 6,013 Segment result 1,217 1,159 67 420 1,284 1,616 Unallocated (1,136) (1,175)corporate overhead Operating profit 148 441 Finance Costs (34) (45) Share of loss of (26) -Joint Venture Profit for the 88 396period Segment Assets 3,383 2,626 - 293 3,383 2,919 Unallocated 2,079 1,544corporate assets Consolidated total 5,462 4,463assets Segment (1,839) (1,961) - (363) (1,839) (2,324)liabilities Unallocated (2,440) (2,317)corporate liabilities Consolidated total (4,279) (4,641)liabilities Net assets 1,183 (178) 4. Earnings per Share The basic earnings per share is calculated by dividing the profit attributableto equity shareholders by the weighted average number of shares in issue duringthe year. In calculating the diluted earnings per share, outstanding shareoptions, warrants and convertible loans are taken into account where the impactof these is dilutive. 6 months to 6 months to year ended 30 June 30 June 31 December 2012 2011 2011 (i) Basic Profit (loss) for the period (£'000) 198 396 (375) Weighted average number of shares in 21,712,508 15,437,437 17,339,456issue (No.) Earning (loss) per share (p) 0.9 p 2.6 p (2.2p) (ii) Fully diluted Profit for the period (£'000) 198 396 (375) Add back interest charged on - 2 30convertible loans (£'000) Revised Profit for the period (£'000) 198 398 (345)
Weighted average number of shares in 21,712,508 15,437,437 17,339,456 issue (No.)
Ordinary shares issuable under - - -convertible loan agreements * 21,712,508 15,437,437 17,339,456 Diluted Earnings per share (p) 0.9 p 2.6p (2.2p)*
* Ordinary shares issuable under outstanding convertible loan agreements, share options and warrants are anti-dilutive.
5. Dividends
No dividend was recommended or paid for the period under review
6. Acquisition Of Subsidiary
On 1st January 2012 the group completed the acquisition of Parallel Smart Media Limited with the purchase of a further 25% of the share capital, taking its holding to 75%. The investment has not been valued for the purpose of these interim accounts but will be for the full year audited financial statements.
7. Financial Liabilities - Borrowings
30 June 31 2012 December 2011 £'000 £'000 Bank borrowings 250 250
The bank facility represents amounts due to Lloyds Bank Plc in less than one year. The total amounts outstanding to Lloyds Bank as at 30 June 2012 and 31 December 2011 are £792k and £917k respectively repayable in 48 consecutive monthly instalments. See note 8 for details.
8. Non-Current Liabilities - Borrowings
30 June 31 Dec 2012 2011 £'000 £'000 Bank loan > 1 year 542 667 542 667
The bank loan represents amounts due to Lloyds Bank in more than one year. Lloyds Bank has provided a loan totalling £1 million. The loan is repayable in 48 consecutive monthly instalments from August 2011 (an effective 5 year term with a one year repayment holiday). The loan carries interest payable at 3% over base and may be repaid early at the discretion of the company. The loan is secured by personal guarantees provided by the David Ciclitira concert party.
9. Issued Share Capital
Issued share capital as at 30th June 2012 is comprised as follows:
* 22,912,346 ordinary shares of 2.2 pence being £0.504 million;
* 199,831,545 deferred ordinary shares of 0.5p each being £0.999 million*
* 103,260 deferred B shares of £19.60 being £2.024 million*
* The deferred ordinary shares do not entitle their holders to receive dividend or other distribution nor do they entitle their holders to receive notice, attend speak or vote at any General Meeting of the Company. The rights of deferred share holders are set out in full in the financial statements as at 31 December 2011 on page 33.
Ordinary shares: during the period ordinary shares were issued as follows:
2012 (number) Ordinary shares of 2.2p each issued during the period 26 April 2012 at 35p per share 1,430,000 3 February 2012 at between 24p and 35p per share 1,462,595
Total shares of 2.2p each issued during the period 2,892,595
26 April 2012- Being £466,075 equivalent settlement of amounts owed to creditors 3 February 2012- Being SGD1 million new share issue for cash 10. Related Parties
Luna Trading Limited and its subsidiary, Parallel Contemporary Arts Limited, is a company under the control of David Ciclitira, and provides consultancy services, loans and guarantees to Parallel Media Group Plc as follows:
Period ended Year ended 30 June 31 December 2012 2011 £'000 £'000 Opening balance 157 114 Loan guarantee interest paid 25 50 Loan fee 20 Payments made to Luna (58) (146) Expenses claimed by Luna 54 139 Total loan amounts outstanding to Luna and PCA 198 157at period end
Luna Trading is the Company through which PMG contract with D Ciclitira for consulting and business services. During the period, Luna Trading charged PMG for consultancy fees of £110k and remote office costs of £31.5k.
In 2010, Luna Trading Limited, David and Serenella Ciclitira agreed to provide personal guarantees of £1 million to Lloyds Bank to support long term PMG loans. As consideration for providing the guarantees, Luna trading charges 5% per annum of the guarantee amount for the period of the guarantee. In addition David Cicilitira has been granted a fixed and floating charge over the Company's assets for the period of the guarantee and has been granted an option to acquire at fair value, Parallel Media (Championships) Limited (a wholly owned subsidiary of PMG which holds the rights to the Company's major sporting events).
During the year PMG incurred costs for the staging and management of art projects and PCA loaned money to PMG. The outstanding balance owed by PMG to PCA at the 30th June was £56,401 due to PCA
11. Other
Copies of unaudited interim results have not been sent to shareholders, however copies are available at www.parallelmediagroup.com or on request from the Company Secretary at the Company's Registered Office, 10 Peterborough Mews, Fulham, London, SW6 5EG.
The Company's AGM will be held at 9am at 10 Peterborough Mews, Fulham, London, SW6 5EG on 29th October 2012. Notice of the AGM will be sent to shareholders by Friday 28th September 2012.
12. Approval of Interim Financial Statements
The interim financial statements were approved by the board of directors on 26th September 2012.