Half-yearly Report
20 June 2008
Talent Group plc
("Talent" or the "Company")
Interim Results
For the six month period ended 31 March 2007
Chairman's statement
I am pleased to report to shareholders for the first time since being appointed
chairman following the annual general meeting at the end of January this year.
The Company's interim results for the period under review show turnover of £
1,164 million (2007 - £1,533 million), gross profit of £341,000 (2007 - £
458,000) and a loss before and after taxation of £145,000 (2007 - loss after
taxation of £325,000). The loss per share was 0.89p (2007-2.0 p)
Whilst these figures show a small improvement at the operating level, on a like
for like basis, they are not what we would like them to be, even though the
industry continues to go through a difficult period. I am pleased to say that
to help compensate for these reductions, prudent management action brought our
administration expenses down to £487,000 from the 2007 figure of £626,000.
As set out in the statement issued by the board on my behalf prior to my
appointment as chairman, I believe that market conditions such as these can
often result in unexpected business opportunities and that with the right
support Talent can position itself to take advantage of such opportunities.
This is why we are initiating a restructuring and reviewing the finances of the
business, in addition to major changes in our personnel and premises.
Following John Kaye Cooper's departure to join ITV as Controller of
Entertainment, we recruited Jonathan Glazier as director of entertainment of
Talent Television Limited ("Talent TV"), our operating subsidiary. Jonathan not
only brings a wealth of international experience with him but also confirmed
his commitment to the Company when he acquired just under 10 per cent. of the
Talent share capital from Mr Cooper. In addition, managing director Tony
Humphreys and I increased our shareholdings in the Company to just under 17 per
cent. and just under 25 per cent. respectively, underlining our confidence for
the future.
Under the restructuring, our childrens' production activities will be brought
under the aegis of the entertainment division and we have already indicated our
intentions to expand our factual entertainment output. We also have a number of
`scripted' projects in development and I will report on further progress in
this field later in the year.
As well as having a strong development slate, I am pleased to report that the
latest series of Best of Friends, currently showing on CBBC, has been well
received and that the fifth Test the Nation - Japan increased its market share
on the previous year. More recently, we were delighted to be commissioned by
ITV for An Audience Without Jeremy Beadle, a tribute to the late presenter,
hosted by Chris Tarrant, which was transmitted in a prime-time Saturday Night
slot on ITV 1 in May.
Although we anticipate further commissions in the very near future, I am
mindful that it will take the new team time to make its mark fully. With
Jonathan Glazier only starting in his new post on 2nd June and with a year end
of 30th September, I do not anticipate that meaningful organic progress will
roll through until the 2008/09 financial year. Although the market remains
difficult and competitive, we believe that these conditions will offer
corporate opportunities which we intend to pursue.
Terry Bate
Chairman
20 June 2008
Group Income Statement
For the six months ended 31 March 2008
6 months to 6 months to Year ended
31 March 31 March 30 September
2008 2007 2007
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Revenue 1,164 1,533 3,333
Cost of sales (823) (1,075) (2,312)
Gross profit 341 458 1,021
Administrative expenses (487) (626) (1,200)
Finance income 1 13 21
Loss before taxation and exceptional (145) (155) (158)
items
Exceptional costs relating to an - (170) (162)
unsuccessful acquisition
Income tax expense - prior year - - (10)
- current year - - 7
Loss for the period (145) (325) (323)
Basic loss per share (pence) (0.89p) (2.00p) (1.99p)
Diluted loss per share (pence) (0.87p) (1.91p) (1.94p)
The results relate to the continuing activities of the Group.
Group balance sheet
As at 31 March 2008
31 March 31 March 30 September
2008 2007 2007
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000 £'000 £'000 £'000
Assets
Non-current assets
Goodwill 987 987 987
Other intangible assets 40 46 43
Property, plant & 55 61 62
equipment
1,082 1,094 1,092
Current assets
Inventories 44 44 54
Trade receivables 836 217 411
Cash & cash equivalents 35 477 943
915 738 1,408
Total assets 1,997 1,832 2,500
Equity and liabilities
Equity
Share capital 6,310 6,310 6,310
Share premium 11,634 11,634 11,634
Share option reserve 119 113 117
Retained earnings (16,879) (16,736) (16,734)
Total equity 1,184 1,321 1,327
Current liabilities
Bank loan 450 - -
Trade & other payables 363 476 1,173
Current tax liability - 35 -
Total liabilities 813 511 1,173
Total equity and 1,997 1,832 2,500
liabilities
Group cash flow statement
For the six months ended 31 March 2008
Note 6 months to 6 months to Year ended
31 March 31 March 30 September
2008 2007 2007
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Cash flows from operating activities
Loss before taxation (145) (325) (320)
Adjustments for:
Depreciation 9 9 19
Amortisation of intangible assets 3 3 6
Interest received (6) (14) (21)
Interest paid 4 - -
(135) (327) (316)
(Increase)/Decrease in trade and (425) 152 (42)
other receivables
Decrease/(Increase) in inventories 10 3 (15)
(Decrease)/Increase in trade and (810) (577) 139
other payables
(1,360) (749) (234)
Tax paid - - (45)
Net cash flows from operating (1,360) (749) (279)
activities
Cash flows from investing activities
Purchase of property, plant and (1) (4) (15)
equipment
Interest received 6 14 21
Interest paid (3) - -
Net cash used in investing 2 10 6
activities
Cash flows from financing activities
Proceeds from borrowings 450 - -
Net cash from financing activities 450 - -
Net cash decrease in cash and cash (908) (739) (273)
equivalents
Cash and cash equivalents at 943 1,216 1,216
beginning of period
Cash and cash equivalent at end of (35) 477 943
period
Group statement of changes in equity
For the six months ended 31 March 2008
Share Share Share Retained Total
Option
Capital Premium Earnings
Reserve
£'000 £'000 £'000 £'000 £'000
At 30 September 2007 6,310 11,634 117 (16,734) 1,327
Changes in equity
Loss for period - - - (145) (145)
Equity share option - - 2 - 2
recognised
At 31 March 2008 6,310 11,634 119 (16,879) 1,184
Share Share Share Retained Total
Capital Premium Option Earnings
Reserve
£'000 £'000 £'000 £'000 £'000
At 30 September 2006 6,310 11,634 112 (16,411) 1,645
Changes in equity
Profit for period - - - (325) (325)
Equity share option - - 1 - 1
recognised
At 31 March 2007 6,310 11,634 113 (16,736) 1,321
Notes to the interim financial statements For the six months ended 31 March 2008
1. Interim financial statements
The interim financial statements do not comprise statutory accounts for the
purposes of s240 of the Companies Act 1985.
These interim financial statements have been prepared applying the accounting
policies and presentation applied in preparing the Group's consolidated
financial statements for the year ended 30 September 2007.
2. Revenue and loss on ordinary activities before taxation
The results for the six months ended 31 March 2008 and 31 March 2007 are
unaudited. The audited results for the year ended 30 September 2007 have also
been shown.
By geographical location 2008 2007
Loss Before Loss Before
Revenue £'000 taxation Revenue £'000 Taxation
£'000 £'000
United Kingdom 1,096 (137) 1,137 (241)
United States - - 324 (68)
Asia 68 (8) 72 (16)
1,164 (145) 1,533 (325)
3. Loss per ordinary share
The loss per share is based on a loss for the period of £145,000 (six months
ended 31 March 2007: a loss of £325,000; year ended 30 September 2007: a loss
of £323,000), being the loss attributable to ordinary shareholders and a
weighted average of 16,210,284 (31 March 2007: 16,210,284; 30 September 2007:
16,210,284) ordinary shares.
The diluted loss per share is based on a time weighting of the options granted
by the current Talent Group employee share option plan.
4. Reconciliation of net cash flow to movement in cash and cash equivalents
31 March 31 March 30 September
2008 2007 2007
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Decrease in cash and cash equivalents (908) (739) (273)
in the period
Cash and cash equivalents at beginning 943 1,216 1,216
of period
Cash and cash equivalents at end of (35) 477 943
period
The loan of £450,000 outstanding at 31 March 2008 related to a specific
production and was repaid in full on 9 April 2008.
5. Copies of interim results
Copies of the interim results will be sent to shareholders shortly and will be
available to members of the public from the Company's registered office, Lion
House, Red Lion Street, London, WC1R 4GB and on the Company's website
www.talenttv.com.
ENQUIRIES:
Talent Group plc
Tony Humphreys Tel: 020 7421 7800
John East & Partners Limited
John East / Simon Clements Tel: 020 7628 2200
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