Zinc Media Regulatory News (ZIN)

FOR RELEASE

Ten Alps Plc

14 December 2012

Interim Results

Ten Alps plc ("Ten Alps" or the "Group") today announces its interim results for the six months to 30 September 2012.

Though moving in a positive direction, the interim results illustrate the challenging environment the Group operates in. The business has focused its propositions, simplified its structures and substantially reduced its cost base but still faces a stressed macro environment.

Revenue from continuing operations was £17.1m (2011: £20.8m) with an adjusted EBITDA loss of £0.67m (2011 profit: £0.49m). The operating loss was £1.52m (2011 loss: £0.74m) after incurring restructuring costs of £0.13m (2011 £0.19m) in the period and £0.56m in non-cash impairment and amortisation (2011: £0.82m). Net loss was £1.82m (2011 loss: £1.15m).

At 30 September 2012, goodwill was £10.3m (2011: £11.4m) with net current assets of £1.29m (2011: £1.56m) reflecting the reclassification of borrowings from current and non-current. Net assets of the Group were £7.36m (2011: £9.17m).

The Group has improved its debt position year on year. Following the successful fund raise of £3m (before expenses) and refinancing in April 2012 the Group assigned the bank debt to debt investors. At the period end the Group had an outstanding debt facility of £4.3m (2011: £6.98m) and loan notes of £1.91m (2011: £1.75m).

Peter Bertram, Chairman, commented:

"As I communicated 12 months ago the key aim was all about creating a solid base from which to develop Ten Alps for the future. We are making progress albeit slowly. We have disposed of non-core assets, simplified the structure of the Group into three distinct divisions, implemented further cost reductions and delivered high calibre products. We believe that by the end of the current financial year, the Group will have completed all its planned restructuring and will be ready for any new challenges".

For further information please contact:

Ten Alps plc

Peter Bertram, Chairman Tel: +44 (0) 207 878 2311

c/o Moira McManus www.tenalps.com

Grant Thornton, Nominated Adviser Tel: +44 (0) 207 383 5100

Colin Aaronson /Jen Clarke www.grant-thornton.com

Canaccord Genuity, Broker Tel: +44 (0) 207 523 8000

Simon Bridges/ Kit Stephenson www.canaccordgenuity.com

Chairman's Statement

BUSINESS OVERVIEW

The Group has continued to deliver on its stated goals of stability, focussed strategies and certain key performance indicators (KPIs). Our aim was to improve our overall performance from this time last year and we believe that this improvement has mostly been achieved in delivering our KPIs. The exception is profits and we aim to address this KPI in the coming 12 months. We are setting similar goals for the coming year with clear emphasis on creative content and products, cash generation, core market growth, brand extension and enhanced overall performance thereby enabling us to address the interests of the various stakeholders of the Group.

The Directors believe that Ten Alps' assets in its three divisions, TV, Marketing Services and Sustainability, are strong and have the potential for future expansion. With market conditions remaining challenging we believe that by delivering solid organic development on a further reduced cost base, the Group can generate improved financial returns and take advantage of wider opportunities in the future.

We continue to maintain strength and depth in our managers and employees. Fiona Stourton and Andrew Mckerlie have now managed the TV unit for a year and a half and the strategy implemented is beginning to show some positive results. Alan Whibley's appointment in April 2012 to the publishing unit has meant a greater focus on core strengths and Scott Ford's continued management of the agencies has helped in achieving reasonable results in a difficult market. Bharti Bhika's promotion in the sustainability division has resulted in improved half year results and shows that the actions taken by senior management across the board are moving the Group forward.

TV

We manage this division to produce engaging, entertaining and intelligent programming. Continuing the good progress made in the last financial year, we will utilise and enhance our skills to produce high quality programming that attracts both audiences and industry awards. The clear plan is to grow the division organically over the next 2-3 years delivering increased revenue and higher profits while maintaining the quality of the products, all from a more diverse client base and genres.

We continue to prioritise development of ideas across all the units and look to further enhance the efficiency of the division and the quality of its output. We will also build on our international reputation to ensure that each company is global in its outlook and capable of working with international clients.

In recognition of the current industry trend we will look to form strategic alliances with respected executive producers and directors who have a similar outlook to ours in order to help deliver our stated mission statement and KPIs.

MARKETING SERVICES

This division has been fundamentally restructured to focus on its core operations and skills and has been rebranded from B2B to encompass two main units namely publishing and agency services. With the closure of our Manchester office during the period followed by the merger of our two London units into Atalink in November 2012, we believe we have now completed the planned restructuring of this division.

The aim continues to be to offer an integrated marketing service which is adaptable to the changing demands of clients without losing sight of our core strengths and delivering our stated KPIs.

The retention and development of existing clients is a key strategy and we aim to do this by increasing our creative approach to meet their evolving needs. To enable us to achieve these strategies we plan to retain and recruit the highest calibre of employees by offering them the opportunity to work on innovative projects and expanding their skills in key niche sectors.

During the next financial year the division will see the individual units collaborating even more closely to further optimise available synergies in terms of both costs and commercial opportunities. In addition we will extend the strong asset brands owned by the Group into other revenue streams that will further enhance those brands and generate incremental margin.

SUSTAINABILITY

This division houses DBDA, our award winning sustainability and consultancy firm. It has also rebranded and was previously known as corporate social responsibility (CSR). DBDA specialises in creating strategies, programmes, campaigns and resources for blue chip corporates, charities and government departments, targeting the sectors of education, safety and health.

These innovative campaigns are delivered through a range of online and digital application based formats as well as a variety of platforms other including print, events and video.

As mentioned previously, this division had a difficult time in the last financial year. However, the appointment of new sales executives, change in management and strategy has seen an improvement year on year. To continue the progress the division will be moving to London by December 2012 taking over the space being released by the merger of the two London publishing units into Atalink.

OPERATING REVIEW

TV

The TV division of Ten Alps focuses on the production of high quality factual programming for major broadcasters. The output of the division includes award winning documentaries, current affairs and investigative content and observational series. The business enjoys a premium reputation and employs a number of highly respected television producers operating under the label of our industry leading brands.

The division has been fully integrated in London with a satellite office in Manchester and a subsidiary in Belfast. The strategy of investment in programme development and key staff has been maintained and has enabled the division to attain certain KPIs, namely increased revenue, a wider client base and sales of series accounting for a greater percentage of revenue in the period.

The division now operates from increasingly centralised facilities with a reduced overhead base as a result. Our key aims are to build revenues on this reduced cost base by exploiting new markets at home and abroad and to look for series, repeatable formats and output deals to offer long term revenue streams and visible order books into the future.

The division achieved revenues from continuing operations of £4.83m (2011: £3.94m) and EBITDA of £0.27m (2011: £0.38m) after development costs of £0.15m (2011: £0.05m) and before allocation of plc costs which, for the Group, amounted to £0.31m (201: £0.41m). Operating profit for the division from continuing activities was £0.19m (2011: £0.27m).

Creative highlights in the financial year so far have included the well-reviewed Shakespeare Uncovered (BBC2/4), Queen Victoria's Last Love (C4), Edward VIII: The Plot to Topple a King (C4), Panorama: The Truth About Sports Products (BBC1) and from Dispatches: Murdoch, Cameron and the £8billion deal (C4), Myths about your 5-a-day (C4) and Tricks of the Dole Cheats (C4). In Belfast, programmes have been produced for BBC Northern Ireland including The Ingenious Mr Hutcheson and George Mitchell-My Journey's End. Finally, there was strong radio production for BBC Radio from A Foreigner Everywhere (Radio 4) to Missing Presumed (Radio 4) and Capital Justice (Radio 4).

MARKETING SERVICES

There are two main units within this division namely the publishing unit and the agency services unit. The largest unit is the publishing unit which now operates solely in the UK delivering content in print, online, tablet and event formats supported by customer advertising and sponsorship.

Publishing

Target sectors for the division's publishing unit have been refined to concentrate on a few targeted business sectors where we believe there is scope for robust growth. These include:

·; Building, energy, freight and transport, defence, business, land and farming, health and consumer.

This focus has seen a positive reduction in the range of titles and a related concentration of effort into the delivery of higher margin owned assets. As part of this focus, the Group disposed of its 65% shareholding in Ten Alps Communications Asia Pte Limited for S$1.2m (approximately £600,000) before costs. The results in the current and previous periods have been adjusted to reflect this discontinued operation.

Creatively the unit developed various initiatives to support existing magazines including a number of sponsored supplements with and Reckitt Benckiser whose products include Dettol and Nurofen. The Cream Awards were successfully launched and the event will be developed into a conference and exhibition event for which there is strong industry support.

There were a number of cross divisional initiatives to develop best practice and cross fertilise editorial and sales ideas including development of on line training and the scope of the "Round table events" (chaired debates) which were expanded to include the Pension reforms, Business skills and Technology in the boardroom. Each was supported by websites and video streamed online. On the same theme, Over the Counter magazine developed an online newsletter which subsequently produced over 8,000 completed online training modules.

The unit continues to develop both content and revenue from online platforms which are supported by the core brands and allow cross media sales opportunities.

The unit achieved revenues from continuing operations of £8.42m (2011: £13.31m) and EBITDA loss of £0.72m (2011: profit £0.72m) before allocation of plc costs as stated previously. Operating loss for the division from continuing activities was £0.92m (2011: profit of £0.39m).

Agency services

The agency services unit operated from a single business unit, Ten Alps Agencies. This business offers design, production, PR, video and media buying services across the full range of platforms, including print, online, events, TV/radio and video.

The agency looks to provide these fee based services in a fully integrated package from a tight and effective cost base. To this end the unit initiated plans in the period to house its production capacities centrally from its operation in Hampshire supported by a client services office in Edinburgh.

The agency has made a significant improvement in the period with the delivery of powerful creative campaigns, digital video and accountable media planning and buying. The Edinburgh unit has produced a number of high profile projects in international B2B, and the Southern unit has acquired a range of new clients that further strengthen the agency's credentials in its core markets.

The media planning and buying unit has produced cost effective and accountable campaigns for new clients in addition to the delivery of quality analysis and strategic guidance for a range of substantial brands in direct response.

The agency continues to focus on building its digital offering with the appointment of personnel in digital media planning/buying and the development team, and has invested in improving skills and training in search engine optimisation (SEO) and social media. The units will continue to focus on the provision of these services as an extension to their core offer and expect further growth in that sector in the coming year.

The agency unit achieved revenues from continuing operations of £2.78m (2011: £2.84m) and EBITDA of £0.05m (2011: £0.02m) before allocation of plc costs as stated previously. Operating profit for the division from continuing activities was £0.04m (2011: £0.01m).

SUSTAINABILITY

Progress is being made in this division during the period. Losses have been stemmed and corporate clients expanded. Restructuring will be complete by the end of 2012 and the relocation to London should help integration with the rest of the Group.

A key focus is the extension of DBDA's reach through strong business development and the generation of wider income streams from its owned assets in the education and safety markets. The KPIs will be increased sales, profitability, cost control, new business and greater integration within the Group.

DBDA successfully launched the new digitised 'Children's Traffic Club' in September 2012(www.childrenstrafficclub.com) with marketing strategies targeting local authorities, SME's and corporates as part of their sustainability objectives including cross promotion in our own titles. Siemens continues to deliver significantly into the business, launching an online platform 'Siemens Education' (www.siemenseducation.co.uk) in November 2012, with a planned extension activity in the UK and internationally taking us through to September 2013. DBDA were also tasked to develop the education outreach component for Siemen's flagship project 'The Crystal' (www.thecrystal.org). 

The speaker services into schools has gained momentum for both Thames Water and Plant Positive as well as the mass participation event 'The Giant Sleepover' which has opened registrations for the event in June 2013 which is being underwritten and sponsored by UNICEF.

The division achieved revenues from continuing operations of £1.05m (2011: £0.76m) and EBITDA of £0.04m (2011: loss £0.22m) before allocation of plc costs as stated previously. Operating loss for the division from continuing activities was £0.18m (2011: loss of £0.57m) after depreciation and amortisation charge of £0.22m (2011: £0.35m).

Peter BertramChairman

FINANICIAL REVIEW

The Group, although having had a challenging six months, is moving in the right direction.

Company revenue from continuing operations was down by 17.8% to £17.1m (2011: £20.8m). Consequently cost of sales decreased by 14.8% to £12.1m (2011: £14.2m) and operating expenses fell by 9.7% from £6.2m to £5.6m as a result of reduced fixed staff costs, the benefits of restructuring feeding through and the strategic move to a more variable freelance model.

EBITDA or headline profit, a key performance measure used by the Board, was a loss of £0.67m (2011 profit: £0.49m). Operating loss was £1.52m (2011loss: £0.74m) after a restructuring charge of £0.13m (2011: £0.19m) and an amortisation and impairment charge on intangibles of £0.56m (2011: £0.82m).

During the year the Group disposed of its 65% shareholding in Ten Alps Communications Asia Pte Limited. The results of these operations, which are presented as discontinued in the condensed income statement, show after tax loss of £0.12m (2011loss: £0.06m) in the period.

Earnings per share

Basic loss per share from continuing operations in the period was 0.72p (2011: 0.80p loss per share) and was based on the loss after taxation of £1.7m (2011 loss: £1.1m) divided by the weighted average number of shares in issue during the period being 234,836,094 (2011:132,541,012). The number of shares has increased due to our successful fund raise in April 2012.

Statement of Financial Position

The Group has amortised non-current goodwill and other intangibles carried forward at a value of £11.18m (2011: £13.79m).

The Group's cash balance has been reduced in the period from £2.86m in March 2012 to £2.51m in September 2012 reflecting the losses incurred. The cash balance as at September 2011 was £3.92m.

Inventories and trade receivables have decreased by £1.98m to £11.72m (2011: £13.70m) reflecting the impact of reduced inventories and receivables as revenue decreased. Trade payables and other creditors have decreased by £1.51m to £12.94m (2011: £14.45m). Deferred income has decreased to £4.34m (2011: £5.28m) again reflecting decreased activity.

The Group has provided for deferred consideration of £0.1m (2011: £0.25m) on the balance sheet, of which £Nil (2011: £0.1m) is due after more than one year. The current considerations relate to earn out payments due to be made in relation to the acquisition of Grove Publishing.

As at the period end, the Group had outstanding debt investor loans of £4.30m (2010: £6.98m). These loans are all non-current balances due after more than one year. The Group also had a loan note of £1.91m (2011: £1.75m) which is non-current and due in March 2016.

Shareholders' Equity

Called up share capital increased to £5.05m (2011: £2.65m) and the share premium increased to £15.23m (2011: £14.63m) reflecting the share placing in the period.

Retained losses as at 30 September 2012 were £13.62m (2011: losses of £9.16m) and total shareholders' equity at that date was £7.36m (2011: £8.83m).

Issue of Shares

On 25 April 2012, the Company issued 120,000,000 ordinary shares at a price of 2.5p per share to institutional and ordinary investors.

Minority Interests

Non- controlling interest was £Nil (2011: £0.34m) reflecting the disposal of Ten Alps Communications Asia Pte Limited in the period.

Broker

The Group also announces today that following the completion of the acquisition of Collins Stewart Hawkpoint plc by Canaccord Financial Inc ("Canaccord"), the Canaccord business has been restructured with the Company's broker, Canaccord Genuity Limited, being transferred to Collins Stewart Europe Limited.

Collins Stewart Europe Limited, which will be the Company's broker going forward, has since been renamed Canaccord Genuity Limited.

Nitil PatelChief Financial Officer

Condensed consolidated interim income statement

Condensed consolidated statement of comprehensive income

Condensed consolidated statement of financial position

Condensed consolidated statement of cash flows

Condensed consolidated statement of changes in equity

Notes to the consolidated financial statements

1) GENERAL INFORMATION

The condensed interim Financial Statements for the six months ended 30 September 2012 were authorised for issue in accordance with a resolution of the Board of Directors on 14 December 2012.

The Company is a public limited company incorporated in the United Kingdom. The address of its registered office is Links House, Suit 4/2 Links Place Edinburgh EH6 7EZ.

The Company is listed on the London Stock Exchange's Alternative Investment Market.

These extracts do not comprise statutory accounts within the meaning of Section 235 of the Companies Act 2006. Statutory accounts for the year ended 31 March 2012 were approved by the Board of Directors on 25 June 2012 which received an unqualified auditors' report and have been delivered to the delivered to the Registrar of Companies. The financial information contained in this report is unaudited.

2) BASIS OF PREPARATION

These condensed consolidated interim financial statements (the interim financial statements) have been prepared in accordance with the accounting policies adopted in the last annual financial statements for the year to 31 March 2012.

3) ACCOUNTING POLICIES

The accounting policies applied in these condensed interim Financial Statements are consistent with those of the annual Financial Statements for the year ended 31 March 2012, as described in the annual Financial Statements.

4) SEGMENTAL INFORMATION

The operations of the group are managed in two principle business divisions, TV, Marketing Services and Sustainability. These divisions are the basis upon which the management reports its primary segment information.

5) DISCONTINUED OPERATIONS

During the six-month period ended 30 September 2012, the Company disposed of its majority stake in Ten Alps Communication Asia Pte Limited, as part of the Marketing Services division overall Group restructuring. Analysis of the result of the discontinued operations is as follows:

During the year ended 31 March 2012, four cash generating units, Education Digital 2 Limited, Ten Alps Asia Limited and the Agencies units in Newcastle and Belfast, have ceased operations. Education Digital 2 Limited ceased trading due to the loss of the Teachers TV contract. Ten Alps Asia Limited was closed as it was a loss making unit. The Newcastle and Belfast business units were closed as part of the Marketing Services division overall Group restructuring. Analysis of the result of the discontinued operations is as follows:

The net cash flows attributable to the discontinued operations are as follows:

6) EARNINGS PER SHARE

7) SHARE CAPITAL