Half-yearly results for 6 months ended 30 Septe...
MediaZest Plc
Half-yearly unaudited results for the six months ended 30 September 2011
CHAIRMAN'S STATEMENT
Introduction
The results for MediaZest Plc ("MediaZest", the "Company", and collectively
with its wholly owned subsidiary, TouchVision Limited, the "Group") reflect the
six-month period to 30 September 2011 and incorporate the results of its wholly
owned subsidiary.
Financial Review
Revenue for the period was £1,746,000 (2010 - £1,080,000) and the Group made a
loss for the period, after taxation, of £151,000 (2010 - loss of £109,000)
after finance costs of £42,000 (2010 - £32,000) and having paid administrative
expenses of £754,000 (2010 - £595,000). The basic and fully diluted loss per
share was 0.054p (2010 - 0.065p). The Group had cash in hand of £139,000 (2010
- £2,000) at the period end. EBITDA was a loss of £103,000 (2010 - loss of £
68,000).
Operational Review
The Group operates, currently, two trading businesses: TouchVision ("TV") and
MediaZest Ventures ("MV). TV trades as an audio visual supply and installation
company whilst MV operates as a digital out of home creative agency.
The results for the period demonstrate a significant increase in turnover in
comparison to the corresponding period in 2010. Turnover for the period was
almost as much as was achieved in the whole of the year ended 31 March 2011.
The source of this increase in revenue was due largely to enhanced spending
from existing retail customers, such as O2, HMV and JD Sports, as well as the
securing of business from new clients such as West Bromwich Building Society.
Business in the Education market is challenging. Government cut backs have
affected the sector as a whole and margins are under pressure. Whilst we made
progress in covering a wider range of educational institutions due to our
inclusion on the consortium panel much of our business in this sector was
derived from lower margin equipment sales rather than full scale refurbishments
and installations. Notwithstanding, we were contracted to perform a major
installation with a south eastern based university as well as smaller pieces of
work with other educational establishments.
The Group continued to monitor its cost base closely and looked to trim costs
where possible without compromising the ability of the Group to generate
revenue. James Abdool joined the Group as Sales Director in the period and has
been responsible for introducing meaningful new business to the Group.
Touchvision, the operating company within the Group, traded profitably for the
period but as yet is not generating enough revenue to absorb the entirety of
Group overhead which along with Group financing costs accounted, largely, for
the period loss of £151,000.
Outlook
The Group will continue to place emphasis on MV's retail offering complemented
by the high quality engineering and installation services that TV provides.
Further hiring of experienced personnel in these areas is anticipated to
enhance the Group's revenue. Furthermore, the Group will continue to place
emphasis on improving the quality of its revenues with the longer term
objective of covering monthly overhead in its entirety from this source. We
have increased the flexibility of our business model by acquiring a number of
high demand capital items, some at extremely favourable prices, for hire/long
term rental to customers. The purpose of this is to take advantage of campaign
business which may not be financially viable if the equipment needed to be
purchased by the client. This is already proving to be beneficial and the Group
continues to look for opportunities to extend this activity, particularly with
a number of high profile events in the next 12 months.
In terms of cost reductions, several property leases that the Group inherited
at the time of its acquisition of TV expire within the next few months and
these are unlikely to be renewed. Financing costs remain high and the Group is
negotiating with the providers of credit to provide improved terms going
forward.
The business that the Group's subsidiary conducts is in essence project based
and whilst progress has been made in changing both the business and revenue
mixes this is likely to persist in the near term. Therefore, it is important to
both retain and enhance existing clients and to bring on board new ones that
can generate a better quality of revenue stream wherever possible. To this
effect we expect to carry out installations for several overseas concerns that
are entering the European market and have quoted on some significant projects
with major companies as well as several trials with large retail concerns.
12 December 2011
Lance O'Neill
Chairman
STATEMENT OF COMPREHENSIVE INCOME FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2011
Unaudited Unaudited Audited
Six months Six months 12 months
Notes 30-Sep-11 30-Sep-10 31-Mar-11
£'000 £'000 £'000
Continuing Operations
Revenue 1,746 1,080 1,918
Cost of sales (1,095) (553) (957)
Gross profit 651 527 961
Administrative expenses (754) (595) (1,315)
EBITDA (103) (68) (354)
Administrative expenses - depreciation (6) (9) (20)
Operating loss (109) (77) (374)
Interest expense (42) (32) (83)
Loss before taxation (151) (109) (457)
Taxation - - -
Retained loss and total comprehensive (151) (109) (457)
loss on ordinary activities after
taxation
Loss per ordinary share
Basic 2 (0.061p) (0.065p) (0.252p)
Diluted 2 (0.061p) (0.065p) (0.252p)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AT 30 SEPTEMBER 2011
Unaudited Unaudited Audited
As at As at As at
30-Sep-11 30-Sep-10 31-Mar-11
£'000 £'000 £'000
Non-current assets
Goodwill 2,772 2,772 2,772
Property, plant and equipment 40 42 32
Total non-current assets 2,812 2,814 2,804
Current assets
Inventories 156 116 120
Trade and other receivables 759 580 523
Cash and cash equivalents 139 2 365
Total current assets 1,054 698 1,008
Current liabilities
Trade and other payables (1,246) (915) (1,008)
Financial liabilities (496) (419) (521)
Total current liabilities (1,742) (1,334) (1,529)
Net current liabilities (688) (636) (521)
Non-current liabilities
Financial liabilities (17) - (25)
Total non-current (17) - (25)
liabilities
Net assets 2,107 2,178 2,258
Equity
Share Capital 2,507 2,428 2,507
Share premium account 3,929 3,580 3,929
Other reserves 7 7 7
Retained earnings (4,336) (3,837) (4,185)
Total equity 2,107 2,178 2,258
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHS ENDED 30
SEPTEMBER 2011
Share
Share Share Options Retained Total
Capital Premium Reserves Earnings Equity
£'000 £'000 £'000 £'000 £'000
Balance at 31 March 2010 2,428 3,580 7 (3,728) 2,287
Loss for the period - - - (109) (109)
Total comprehensive income for the - - - (109) (109)
period
Balance at 30 September 2010 2,428 3,580 7 (3,837) 2,178
Loss for the period - - - (348) (348)
Total comprehensive income for the - - - (348) (348)
period
Issue of share capital 79 361 - - 440
Share issue costs - (12) - - (12)
Balance at 31 March 2011 2,507 3,929 7 (4,185) 2,258
Loss for the period - - - (151) (151)
Total comprehensive income for the - - - (151) (151)
period
Balance at 30 September 2011 2,507 3,929 7 (4,336) (2,107)
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2011
Unaudited Unaudited Audited
Six Six 12 months
months months
Note 30-Sep-11 30-Sep-10 31-Mar-11
Cash flows from operating activities £'000 £'000 £'000
Cash used in operations 3 (137) (331) (423)
Net cash used in operating activities (137) (331) (423)
Cash flows from investing activities
Purchase of property, plant and equipment (14) (3) (4)
Net cash used in investing activities (14) (3) (4)
Cash flow from financing activities
Bank loan - 48 50
Repayment of borrowings (8) - (9)
Shareholder loans - 81 325
Shareholder repayments (25) - (110)
Interest paid (42) (32) (83)
Net proceeds on issue of shares - - 440
Share issue costs - - (12)
Net cash (used in)/generated from (75) 97 601
financing activities
Net (decrease)/increase in cash and cash (226) (237) 174
equivalents
Cash and cash equivalents at beginning of 151 (23) (23)
period
Cash and cash equivalents at end of period 4 (75) (260) 151
NOTES TO THE FINANCIAL INFORMATION
1. Basis of preparation
The Group's annual financial statements are prepared in accordance with
International Financial Reporting Standards (IFRS) as adopted for use in the EU
applied in accordance with the provisions of the Companies Act 2006 applicable
to companies preparing financial statements under IFRS.
Accordingly, the consolidated half-yearly financial information in this report
has been prepared using accounting policies consistent with IFRS. IFRS is
subject to amendment and interpretation by the International Accounting
Standards Board (IASB) and the IFRS Interpretations Committee and there is an
ongoing process of review and endorsement by the European Commission. The
financial information has been prepared on the basis of IFRS that the Directors
expect to be applicable as at 31 March 2012.
This interim report does not comply with IAS 34 "Interim Financial Reporting"
(as adopted by the European Union), as permissible under the AIM Rules for
Companies.
Going Concern
The Directors have considered financial projections based upon known future
invoicing, existing contracts, pipeline of new business and the number of
opportunities it is currently working on, particularly in the retail sector. In
addition, these forecasts have been considered in light of the ongoing economic
difficulties in the UK and global economy, previous experience of the markets
in which the company operates and the seasonal nature of those markets, as well
as the likely impact of ongoing reductions to public sector spending. These
forecasts indicate that the company will generate sufficient cash resources to
meet its liabilities as they fall due over the 12 month period from the date of
this interim announcement.
As a result the directors consider that it is appropriate to draw up the
accounts on a going concern basis. Accordingly, no adjustments have been made
to reflect any write downs or provisions that would be necessary should the
Group prove not to be a going concern, including further provisions for
impairment to goodwill and investments in Group companies.
Non-statutory accounts
The financial information contained in this document does not constitute
statutory accounts within the meaning of section 434 of the Companies Act 2006
("the Act").
The statutory accounts for the year ended 31 March 2011 have been filed with
the Registrar of Companies. The report of the auditors on those statutory
accounts was unqualified, did not draw attention to any matters by way of
emphasis and did not contain a statement under section 498(2) or (3) of the
Act. The financial information for the six months ended 30 September 2011 and
30 September 2010 is not audited.
2. Loss per share
Basic loss per share is calculated by dividing the loss attributed to ordinary
shareholders of £151,000 (2010 - £109,000) by the weighted average number of
shares during the period of 247,625,327 (2010 - 167,625,327). The diluted loss
per share is identical to that used for basic loss per share as the exercise of
warrants would have the effect of reducing the loss per share and therefore is
not dilutive under International Accounting Standard 33 "Earnings per Share".
3. CASH GENERATED FROM/(USED IN) OPERATIONS
Unaudited Unaudited Audited
Six months Six months 12 months
30-Sep-11 30-Sep-10 31-Mar-11
£'000 £'000 £'000
Operating loss (109) (77) (374)
Depreciation of tangible assets 6 9 20
Increase in inventories (36) (22) (26)
Increase in payables 238 84 225
Increase in receivables (236) (325) (268)
Cash used in operations (137) (331) (423)
4. CASH AND CASH EQUIVALENTS
Unaudited Unaudited Audited
Six months Six months 12 months
30-Sep-11 30-Sep-10 31-Mar-11
£'000 £'000 £'000
Cash held at bank 139 2 365
Invoice discounting facility (214) (262) (214)
(75) (260) 151
5. Distribution of the Half-yearly Report
Copies of the Half-yearly Report will be available to the public from the
Company website, www.mediazest.com, and from the Company Secretary at the
Company's registered address at 3rd Floor, 16 Dover Street, London W1S 4LR.
MediaZest Plc
Tel: 0207 724 5680
Contact: Geoff Robertson
Nominated Adviser
Northland Capital Partners Ltd
Tel: 0207 796 8800
Contact: Gavin Burnell/Rod Venables
Broker
Hybridan LLP
Tel: 0207 947 4004
Contact: Claire Noyce/Tim Goodman/Deepak Reddy
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