One Media Regulatory News (OMIP)

One Media iP Group Plc ("One Media", the "Group" or the "Company") UNAUDITED INTERIM RESULTS Profit before taxation up 31.5%, turnover up 13% and interim dividend of 0.071p ence declared USD$2 million advance agreed with The Orchard One Media iP Group plc (AIM: OMIP), the digital media content provider thatexploits intellectual property rights around music and video, is pleased toannounce its half year results for the period ended 30 April 2014 and aninterim dividend. Highlights: * Turnover up 13% to £1,492,412 (2013: £1,325,119); * Profit before tax up 31.5% to £344,865 (2013: £262,180); * Cash balances of £1,411,305 at 30 April 2014 (2013: £1,919,668); * Dividend of 0.077p per ordinary share paid in November in respect of the year ended 31 October 2013; and * Interim dividend of 0.071p per ordinary share declared in respect of the six month period ended 30 April 2014. As announced on 10 June 2014, a USD$2,000,000 advance against future royaltieswas agreed with the Company's distributor, The Orchard. Michael Infante, Chairman and CEO, commented: "I am very pleased with ourongoing progress and today's published results and post-balance sheet events.The Group continues to deliver shareholder value, both through improvedfinancial performance and the acquisition of content, which the Board believesadds considerable value to One Media setting the Company apart. We do facechallenges however in our digital world and the Board recognises that there isno room for complacency. Streaming music sites such as Spotify and YouTube arebeginning to dominate what was, only a short time ago, the majority `sellingspace' held by the traditional digital stores such as iTunes" "We embrace all forms of digital exploitation but the shifts in digital modelstoday are demanding and require us to keep ahead of the curve on all ourdistribution services. We are constantly monitoring trends and keep ahead bytraining our team in new methods of digital marketing utilising social media.We are confident that your Company is correctly positioned to meet the manydemands within the industry." For further information, please contact: One Media iP Group Plc Chairman and Chief ExecutiveMichael Infante Tel: +44 (0)175 378 5500 Cairn Financial Advisers LLP Nominated AdviserLiam Murray / Jo Turner Tel: +44 (0)20 7148 7900 Charles Stanley Securities Limited BrokerMark Taylor Tel: +44 (0)20 7149 6000 Yellow Jersey PR Limited Financial PRKelsey Traynor/Dominic Barretto/Philip Ranger Tel: +44(0)7799 003 220 CHAIRMAN & CHIEF EXECUTIVE STATEMENT The Group has continued to show good progress in the six months period to 30April 2014 with growth in both turnover and profit before taxation and hascontinued to develop its content portfolio with a number of small acquisitionsof content and rights. Results for the six months ended 30 April 2014, theGroup's consolidated turnover increased by 13% to £1,492,412 (2013: £1,325,119)and, an increase of 13% on the equivalent period last year when £1,325,119 wasreported. Profit before tax and interest increased by 31.5% to £344,865 is reported forthe six months, up 31.5% on the equivalent figure of (2013: £262,180). The Group continued to invest in intellectual property and copyrights, spendinga further £375,901 in this area during the period. Following the exercise in November 2013 of employee share options and theexercise of warrants by directors and an institutional investor in April 2014 atotal of £92,500 was raised in new equity. Cash balances at 30 April 2014 continued to remain strong at £1,411,305. As announced on 10 June 2014, a USD$2,000,000 advance against future royaltieswas agreed with The Orchard, the Company's primary digital distributor. The Group receives the majority of its income in US Dollars. Recent shifts inexchange rates have not favoured us and the Board is conscious to carefullymonitor exchange rates to ensure best conversion deals from time to time. OneMedia deals in a worldwide market and we have to convert our digital incomefrom the many territories currencies in which we deal on a monthly basis. Allof these local currencies are converted to US Dollars which are ultimately arereported in Pounds Sterling. Dividend Pursuant to the dividend payment of 0.077p per share in November 2013, theGroup is pleased to announce that it intends to pay an interim dividend of0.071p per ordinary share in respect of the 6 month period ended 30 April 2014.The ex-dividend date of this payment is 25 June 2014, the record date is 27June 2014 and the expected payment date 8 July 2014. Contents and Acquisitions During the period, the Company has not issued new shares as consideration foracquisitions and has used existing cash resources as consideration. In December2013, One Media acquired various rights for a consideration of USD$100,000 forseveral back catalogues of music and video. The first of four was for the Irish singer `Rose-Marie'. This exclusive dealincludes over 160 tracks (24 albums) of Irish and standard ballads. Rose-Marieis a prolific Irish performer well known within the cabaret, TV and recordingcircles. The catalogue includes a host of standards including Danny Boy, AveMaria and Abide with Me. The second was for the exclusive license with an on-going royalty for certaintitles taken from the `Delta Leisure Group' video library for digitalexploitation. Over 250 programmes of trains, planes and automobiles and variousspecial interest content including cookery, sports, fishing and keep fitinstructional videos were included. All of the content will be made availablethrough One Media's emerging video channels on YouTube and other advertisingfunded broadcast mediums. The third was for the exclusive audio book rights to the 'Lost Elvis Diaries'written and edited by Aubrey Malone. The book which is a recreation of Elvis'slife is written in diary form. This audio-visual digital book deal whichcontains many previously unpublished photographs from Elvis's life will beoffered in all formats including: electronic written publication (`Kindle'style) and via download in spoken word format for all the Group's digitalstores such as iTunes, Amazon, Spotify and serialised on YouTube. The fourth deal concluded was a revisit to one of One Media's originallicensors and royalty partners. One Media invested in the High Energy/NorthernSoul/Motorcity catalogues (Tropicana) originally in 2006. This deal wasextended in 2010 for a period of 25 years. The Group can now report that it hastaken ownership of the 2,500 soul/dance music tracks and associated videos. Thecatalogue contains 80s chart topping artists like `Evelyn Thomas' performingher number one hit 'High Energy', performances from `Johnny Bristol', `BarbaraPennington', `Martha Reeves', `Marv Johnson' and the `Former Ladies of theSupremes' just to mention a few of the 200 artists featured within thecatalogue. In January 2014, One Media consolidated a long term licensor's agreement fortheir audio rights for a consideration of USD75,000. We continue to activelypursue `buy-out' deals with our royalty partners as they impact positively onprofitability but of course have no effect on turnover. Subsequent to the balance sheet date in May 2014, One Media announced that ithad acquired, under an exclusive license with an on-going royalty, the 'Rockand Roll Palace' and 'Church Street Station' music-video catalogues; this dealwas concluded with the `Henry Hadaway Organisation' ("HHO") for a totalconsideration of £300,000 plus VAT. The two catalogues contain hundreds ofmusic-video performances by various artists such as; `Tammy Wynette', `CharlieRich', `George Jones', `Lynn Anderson', `Mickey Giley', `Tanya Tucker', `TheBellamy Brothers', `The Osmonds', `Del Shannon', `The Platters', and the`Shirelles' to name just a few. Directors Share Trading The Group announced that on 9 April 2014, and to satisfy investor demand, thedirectors of the Company sold their warrants to institutional investors. A total of 5,250,000 warrants were realised in the Directors' Dealings. Thereare no outstanding warrants issued to the directors. We saw this as a tidyingup event to remove the `overhang' and to increase liquidity within the marketplace. The Market At the beginning of this financial year (November 2013 to April 2014) the Boardimplemented several changes within the Group's internal technical operations,to ensure we keep `current' with digital market forces. As digital `streaming'begins to have greater traction in both our video and audio markets, we havecommenced a series of cross-training exercises with our team of in-housecreative technicians. As you may recall, I stated that we would be focused oninvesting in people this time last year to facilitate video. The day-to-day jobof delivering both music and video to over 600 digital stores has advanced inline with industry changes. Our foresight and investment over the last nineyears has made our systems, eminently flexible. Our bespoke ingestion system,developed in-house, caters for our needs and has been handling upwards of 20million digital transactions per month. Couple this with the arrival of themonetisation and managing our emerging YouTube channels - there is a lot ofdata to monitor. What is changing is the diverse consumer choice between the iTunes(downloading) model and that of the Spotify `streaming' model. I have longbelieved - if one can say that in an industry less than ten years old- that`streaming' will be the driving force in both video and audio consumerpreference. Liberating a consumer's chosen device's hard drive from having tocontain `terabytes' and potentially `petabytes' of data is far too restrictiveand not necessary. Therefore `streaming' and `on-demand' services will be theway forward. Additionally, sound purists will tell you that music and video can stand onlyso much `compression' before the quality of the content is challenged. Asbroadband becomes broader and more widely accessible via the static delivery ofyour home phone line or via the roaming services of 4G, more data is beingdelivered into our daily lives than ever before. It is therefore an engineeringchallenge (even with micro-chips and hard drives being miniscule) to store thequantity of data now required for the longer term onto your chosen device. Thisdata (whether it be music or video) is available at any time anywhere in theworld via a streaming service. The `Cloud' has no limits. This makes hardwarecheaper and processors faster. There is the additional benefit to content owners and artists alike that the`streaming' model offers. Young consumers that do not have the ability of usingcredit cards to purchase music online are drawn to free illegal download sites.Many of these sites, and the various illegal torrent stores or file sharingsites offer vast amounts of music and video at no charge. If consumers canaccess safely and legitimately and without fear of `bugs' and `viruses' and/orat low subscription prices a legitimate music store (and sometimes free viaad-funded revenue sharing schemes), why risk the pirate sites. Additionallytelecom companies (such as Vodafone) have offered subscription memberships tomusic stores as part of their monthly mobile tariffs. These initiatives I seeas growing and ultimately good for the industry in the fight against piracy andgrowing legitimate continual revenue streams. Outlook A recent report by PriceWaterhouseCoopers ("PwC") has predicted that globalstreaming music revenues will see compound growth of 13.4% over the next fiveyears, but that music downloads will still grow as well, albeit by just 3.3%.PwC thinks that the global media and entertainment industry will grow at a 5%compound annual growth rate to USD2.15 trillion by 2018, with digital spendinggrowing at 12.2%, and accounting for 65% of the overall revenue growth in thatperiod. By 2018, the report suggests that China, Brazil, Russia, India, Mexico,South Africa, Turkey, Argentina and Indonesia will account for 21.7% of globalrevenues. The first half of our year emulates the trend above in turnover. Stores such asiTunes are being repositioned by the competiveness and the affordability ofstreaming stores such as Spotify, Deezer and YouTube. Whilst we are not seeinga drop in revenues from the downloading stores such as iTunes we are seeing aslowing of growth in their model. Conversely we have seen enlarged growth inthe "streaming' stores model as they ingratiate themselves with consumers. Afinal word on growth, not all consumers both here in the UK and the rest of theworld have yet switched to digital consumption. We must not forget, albeit yourGroup does not trade in it, that physical product still exists in the form ofCD and DVD. We are still only experiencing approximately 37% of music and videoconsumers worldwide who have embraced the digital medium so far, so with aheadroom of circa 63% of worldwide consumers yet to discover digital music andvideo, we are very much still in a growth market. MICHAEL INFANTE CHAIRMAN AND CHIEF EXECUTIVE 17th June 2014 Unaudited Consolidated Statement of Comprehensive Income For the six months ended 30 April 2014 Unaudited Unaudited Audited 6 months 6 months 12 months ended ended ended 31 30 April 2014 30 April 2013 October 2013 £ £ £ Revenue 1,492,412 1,325,119 2,649,130 Cost of sales (712,822) (628,384) (1,273,592) _________ _________ _________ 779,590 696,735 1,375,538 Administrative expenses (434,725) (434,555) (851,890) _________ _________ _________ Profit from continuing 344,865 262,180 523,648activities Other expenses - Aim float - (196,559) (196,559)and associated costs _________ _________ _________ Operating profit 344,865 65,621 327,089 Finance income 705 1,046 2,800 _________ _________ _________ Profit on ordinary activities 345,570 66,667 329,889before taxation Taxation (21,000) (49,200) (90,980) _________ _________ _________ Profit for period 324,570 17,467 238,909attributable to equityshareholders ========= ========= ========= Basic adjusted earnings per 0.49p 0.031p 0.40pshare ========= ======= ========= Unaudited Consolidated Statement of Financial Position As at 30 April 2014 Unaudited Unaudited Audited 30 April 2014 30 April 2013 31 October 2013 £ £ £ Assets Non-current assets Intangible assets 2,108,759 1,661,416 1808,535 Property, plant and 18,547 38,388 26,439equipment _________ _________ _________ 2,127,306 1,699,804 1,834,974 _________ _________ _________ Current assets Trade and other 585,119 435,198 481,453receivables Cash and cash 1,411,305 1,919,668 1,688,093equivalents _________ _________ _________ Total current assets 1,996,424 2,354,866 2,169,546 _________ _________ _________ Total assets 4,123,730 4,054,670 4,004,520 ========= ========= ========= Liabilities Current liabilities Trade and other payables 1,206,414 1,720,339 1,468,312 _________ _________ _________ _________ _________ _________ Total liabilities 1,206,414 1,720,339 1,468,312 _________ _________ _________ Equity Called up share capital 353,518 320,018 324,768 Share redemption reserve 239,546 239,546 239,546 Share premium account 1,452,895 1,370,895 1,389,145 Share based payment 40,629 18,835 26,192reserve Retained earnings 830,728 385,037 556,557 _________ _________ _________ Total equity 2,917,316 2,334,331 2,536,208 _________ _________ _________ _________ _________ _________ Total equity and 4,123,730 4,054,670 4,004,520liabilities ========= ========= ========= Unaudited Consolidated Statement of Changes in Equity For the six months ended 30 April 2014 Share Share Share Share Retained Total capital redemption premium based earnings equity reserve payment reserve £ £ £ £ £ £ At 1 November 273,143 239,546 718,271 12,416 387,783 1,631,1592012 Issue of share 46,875 - 703,125 - - 750,000capital Costs of share - - (50,501) - - (50,501)issue Profit for the - - - - 17,467 17,467six months to 30 April 2013 Share option - - - 6,419 - 6,419charge Dividends - - - - (20,213) (20,213) ________ _________ _________ _________ _________ _________ At 30 April 320,018 239,546 1,370,895 18,835 385,037 2,334,3312013 Issue of share 4,750 - 18,250 - - 23,000capital Profit for the - - - - 221,442 221,442six months to 31 October 2013 Share option - - - 7,357 - 7,357charge Dividends - - - - (49,922) (49,922) ________ _________ _________ _________ _________ _________ At 31 October 324,768 239,546 1,389,145 26,192 556,557 2,536,2082013 Issue of share 28,750 - 63,750 - - 92,500capital Profit for the - - - - 324,570 324,570six months to 30 April 2014 Share option - - - 14,437 14,437charge Dividends - - - - (50,399) (50,399) ________ _________ _________ _________ _________ _________ Balance at 30 353,518 239,546 1,452,895 40,629 830,728 2,917,316April 2014 ======== ========= ========= ========= ========= ========= On 8 November 2013 500,000 employee share options, over ordinary shares of 0.5peach, were exercised at 2.75p per share. Further, as announced on 10 April2014, Michael Infante sold 1,800,000 warrants in ordinary shares of 0.5p each,with an exercise price of 1.5p directly to one institutional investors. Theinvestor immediately exercised the warrants over 1,800,000 new ordinary shares.Also a further 3,450,000 million warrants, over ordinary shares of 0.5p each,with an exercise price of 1.5p were exercised by directors. Unaudited Consolidated Cash Flow Statement For the six months ended 30 April 2014 Unaudited Unaudited Audited 6 months 6 months 12 months ended ended ended 31 October 2013 30 April 2014 30 April 2013 £ £ £ Cash flows from operatingactivities Profit before taxation 345,570 66,667 329,889 Amortisation 75,677 53,933 118,959 Depreciation 10,557 13,267 27,389 Share based payments 14,437 6,419 13,776 Finance income (705) (1,046) (2,800) (Increase)/decrease in (103,666) (29,436) (75,691)receivables (Decrease)/increase in payables (282,898) 1,037,986 819,873 Corporation tax paid - - (75,694) _________ _________ _________ Net cash inflow from operating 58,972 1,147,790 1,155,701activities _________ _________ _________ Cash flows from investingactivities Investment in copyrights (375,901) (273,209) (485,354) Investment in fixed assets (2,665) (3,900) (6,073) Finance income 705 1,046 2,800 Corporation tax paid _________ _________ _________ Net cash used in investing (377,861) (276,063) (488,627)activities _________ _________ _________ Cash flow from financingactivities Proceeds from the issue of new 92,500 750,000 773,000shares Share issue costs - (50,501) (50,501) Dividend paid (50,399) (20,213) (70,135) _________ _________ _________ Net cash outflow from financing 42,101 679,286 652,364activities _________ _________ _________ Net change in cash and cash (276,788) 1,551,013 1,319,438equivalents Cash at the beginning of the 1,688,093 368,655 368,655period _________ _________ _________ Cash at end of the period 1,411,305 1,919,668 1,688,093 ========= ========= ========= Notes to the Interim Report For the six months ended 30 April 2014 1. Nature of operations and general information One Media iP Group Plc and subsidiaries' ("the Group") principal activities arethe acquisition and licensing of audio-visual intellectual copyrights andpublishing for distribution through the digital medium and to a lesser extentthrough traditional media outlets. One Media iP Group Plc is the Group's ultimate parent company incorporatedunder the Companies Act in England and Wales. The address of One Media iP GroupPlc registered office is 623 East Props Building, Goldfinger Avenue, PinewoodRoad , Iver Heath, Buckinghamshire, SL0 0NH. The financial information set out in this Interim Report does not constitutestatutory accounts. The Group's statutory financial statements for the yearended 31 October 2013 are available from the Group's website. The auditor'sreport on those financial statements was unqualified. 2. Accounting Policies Basis of Preparation These interim consolidated financial statements are for the six months ended 30April 2014. They have been prepared following the recognition and measurementprinciples of IFRS. They do not include all the information required for fullannual statements, and should be read in conjunction with the consolidatedfinancial statements of the Group for the year ended 31 October 2013. This unaudited interim statement has not been subject to a review by theGroup's auditors James Cowper LLP. Comparatives The comparative periods represent the unaudited results for the six monthsperiod ended 30 April 2013 and the audited twelve months figures for the yearended 31 October 2013. 3. Earnings per share The calculation of the earnings per share is based on the profit for thefinancial period divided by the weighted average number of shares in issueduring the period. Unaudited Unaudited AuditedBasic earnings per 6 months ended 6 months ended 12 months endedshare 30 April 2014 30 April 2013 31 October 2012 Profit for period 324,570 17,467 238,909attributable to equityshareholders Weighted average number 66,037,498 55,716,405 59,999,725of shares in issue atperiod end _________ _________ _________ Basic earnings per 0.49p 0.031p 0.40pshare ========= ========= ========= The diluted earnings per share would be lower than the basic profit per shareas the exercise of warrants and options would be dilutive. 4. Share capital Unaudited Unaudited Audited 30 April 2014 30 April 2013 31 October 2013 Group and company £ £ £ Authorised: 200,000,000 ordinary shares of 1,000,000 1,000,000 1,000,0000.5p each ========== ========== ========== Issued: Ordinary shares of 0.5p each 70,703,698 at 30 April 2014 , 353,518 320,018 324,76864,003,698 at 30 April 2013 and64,953,698 at 31 October 2013ordinary shares of 0.5p each ========== ========== ========== 5. Dividend The Directors are delighted to announce a second divided for the year of £50,200 (0.071p per share) following the earlier dividend of £50,399 (0.077p pershare). Our intention is to reward those investors that have been loyal and tofurther demonstrate that One Media is an investment opportunity providing areturn that we believe we will enhance shareholder value. 6. Interim statement Copies of this statement are available from Group's registered Office at: 623 East Props Building, Goldfinger Avenue, Pinewood Road, Iver Heath,Buckinghamshire, SL0 0NH. Notes to Editors: One Media is a digital music and video rights owner. The consumer led but B2B(Business-to-business) operation looks to exploit its catalogue of over 200,000music tracks and over 7,000 hours of video by recompiling the content for salethrough over 600 digital music and video stores worldwide. The Company has ateam of Creative Technicians who digitise the content, create the metadata andre-compile and prepare the digital music & video releases using bespoke in-house software. Additionally, One Media makes its library of content available for TV shows,movies, adverts, games and websites. One Media operates an online sync databasesystem that enables music supervisors to explore the library and select tracksfor music briefs. One Media focuses on music performed by well known artists from every genre,including; pop, rock, reggae, R&B, children's music, karaoke, jazz, soul,blues, rap, hip-hop, gospel, world-music, plus stand-up comedy, spoken-word andover 1,000 hours of classical music. One Media is eligible for Enterprise Investment Schemes ("EIS") and VentureCapital Trusts ("VCT")