MUBL.L Regulatory News (MUBL)

25 Jan 2006 07:01

Air Music & Media Group PLC25 January 2006 FOR IMMEDIATE RELEASE 25 JANUARY 2006 Air Music & Media Group plc ("Air Group" or "the Group") TRADING UPDATE Trading in line with expectations The Board of Air Group, the UK distributor of home entertainment products,provides shareholders today with a Trading Update. HIGHLIGHTS: •Christmas sales in line with management expectations; •Confidence in full year results meeting market expectations; •Successful centralisation of UK distribution - anticipated to generate future overhead savings; •Pilot scheme of retail outlets for Air Group's product range; •Exclusive supply arrangement with Universal Music for selected products; •Group remained comfortably within its banking facilities; and •EGM called for 27 January 2006. Sales in the critical Christmas trading period were in line with managementexpectations. Trading performance in January 2006 has also performed well and,accordingly, the Directors remain confident that the full year results will meetmarket expectations. The caution the Board expressed in mid-December, regarding the performance ofretail activity, proved relatively unfounded. Sales for the Group were £26.4million in the quarter to 31 December 2005, compared to £26.1 million on acomparable basis in the quarter to 31 December 2004. The activity in theChristmas trading period gives the Board confidence in achieving sales ofbetween £68-70 million for the year ending 31 March 2006. The Group completed the successful centralisation of UK distribution through its100,000 square foot facility in Leyland, during the busiest period of the yearwith no disruption to operations. This is anticipated to generate overheadsavings in the next financial year. In addition, in November the Group commenceda pilot scheme of introducing retail outlets on a discount/value theme sellingfrom the Group's existing product range. The Group operated six stores in theNorth East of England which generated £0.9 million in sales to 31 December 2005. The Group has recently entered into an exclusive supply arrangement giving itaccess to selected Universal Music budget releases which are produced byUniversal exclusively for the Group. These releases, which appear under theGroup's own-label 'United', raise the overall quality of the Group's own-labelproducts which previously were restricted to superbudget repertoire. The Group remained comfortably within its banking facilities during the peakworking capital period, and continued to meet scheduled borrowing repayments.The Directors acknowledge the low market valuation currently placed on the Groupand in the current situation are not pursuing new acquisition opportunities thatwould involve the further issue of shares. The Directors are consideringaccelerating the repayment of debt during 2006. The Company has called an EGM for 27 January 2006 at which time the Board willseek consent for amongst other things a share consolidation and the authority tobuy back Company shares. --ENDS-- Enquiries: AIR MUSIC & MEDIA GROUP PLCJohn French, Chairman Tel: 078 3672 2482Alex Sorrell, Finance Director Tel: 01772 455 000 BISHOPSGATE COMMUNICATIONS LIMITED Tel: 020 7430 1600Dominic BarrettoMaxine Barnes This information is provided by RNS The company news service from the London Stock Exchange