Interim Results

Catalyst Media Group PLC 01 July 2004 1 July 2004 CATALYST MEDIA GROUP PLC UNAUDITED INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 APRIL 2004 Catalyst Media Group plc ('CMG'), formerly known as Newsplayer Group plc, the media company, today announces its unaudited interim results for the six months ended 30 April 2004. Financial Highlights: • Turnover of £1,655,071 compared to £151,017 for the six months ended 31 October 2003. • Pre-tax loss of £709,883 compared to a loss of £4,102,240 for the six months ended 31 October 2003. • Cash reserves of £1,356,073 at 30 April 2004 compared to £587,323 at 31 October 2003. Operational Highlights: • Acquisition of Betelgeuse Productions Inc. ('BPI') in New York completed in March 2004. • Placing of new shares to raise £2,750,000 in March 2004. • Betelgeuse and GMS win $6m ChampCar contract. • CMG channels launched on NTL's Broadband Plus platform. • Renewed licence for CMG consumer channels to KPN for one year. • Signed distribution agreement with VOD Pty of Australia. Commenting on the results, Paul Duffen, Chief Executive Officer, said: 'These results reflect the significant progress that the Group has made over the past year. We are now profitable and cash generative on a monthly basis and on course to make a profit for the current financial year. In March 2004 we acquired Betelgeuse Productions Inc in New York which followed the acquisition of GMS in September 2003. Both businesses are performing ahead of expectations and have demonstrated their synergy by winning the $6 million contract to produce the Champ Car racing series both on-air and on-line. Adding value to live sport through the application of interactive technology is an area we will continue to focus on. As part of this strategy we are in the process of acquiring a 20% stake in Satellite Information Services, based in London, who are one of the world's largest producers of live sport. We expect this transaction to be completed by the middle of August 2004.' Enquiries: CMG plc 020 7927 6699 Merlin PR 020 7653 6620 Paul Duffen, CEO David Simonson/Rebecca Penney Durlacher Limited 020 7459 3600 Richard Swindells/Marcus Jackson CHIEF EXECUTIVE STATEMENT OVERVIEW Catalyst Media Group plc is a media company that manages, produces and distributes high quality audio-visual content using interactive digital technology. CMG provides clients with a comprehensive range of professional services to support their online strategies. CMG is becoming the partner of choice for media companies in the digitisation and distribution of broadcast content and interactive programme creation. Additionally, CMG supports corporations and organisations from other industrial sectors by enabling them to use streaming and download distribution to support communication with customers, investors and employees. Furthermore, CMG is a rights holder on its own account specialising in historic entertainment and educational content. CMG generates revenues from the licensing of content globally to third parties, from consumer subscriptions and pay-per-view fees and from advertising revenue. MEDIA CHANNELS AND LICENSED CONTENT Footage.net - A leading stock footage portal which manages the databases of many of the world's leading stock footage libraries, including ABC News, CNN, Action Sports, National Geographic, and many others. Newsplayer.com - A video-on-demand (VOD) consumer channel offering 1,000 hours of footage from ITN/ Reuters, including material from Paramount, Gaumont, British Empire News, Visnews, French Pathe et al. Features original video footage of some of the most important and notable news stories of the 20th century. Frost.tv - A VOD channel featuring the unparalleled, 40-year archive of Sir David Frost's original interviews with the world's most famous public figures. The strategic partnership between CMG and Sir David extends also to marketing content in professional markets, both on- and off-line. Screenplayer.com - A VOD channel offering the largest collection of Hollywood footage in the world from Passport International Productions. The archive includes more than 650 hours of movie-related documentaries comprised of film trailers, celebrity interviews and profiles of the stars. Video.tv - A VOD channel providing an interactive collection of EMI music videos. Advanced negotiations are under way with other major record labels that have expressed an interest in having their material represented. Birdstream.com - A VOD channel giving access to 100 hours of award-winning wildlife footage in the Film Collection of the Royal Society for the Protection of Birds (RSPB). Professionals in TV and advertising can also play, edit and license the material at www.rspbfilmcollection.com, managed by CMG. Pure World Cup.com- A VOD channel providing World Cup highlights from 1958 to 1998. The Alison Mercer Collection- CMG has an exclusive licence for 80 hours, or 1400 video clips, of film-related material of cinema's golden age and US-focused archive news and features. Stock Video of Boston- CMG has an exclusive licence for 150 hours of classic sports footage from Stock Video of Boston, sourced from Columbia Sports News, Castlefilms and a selection of private collections. FINANCIAL RESULTS The loss for the period was £710,383 compared to a loss of £2,426,194 for the equivalent period in 2003. No dividend has been paid or is proposed. OUTLOOK The recent acquisitions of GMS and Betelgeuse in New York have consolidated the Group's positioning as a full service, cross platform, digital content business and provide critical mass, infrastructure and efficiencies for the Group's activities in the USA. The collaboration between these two businesses has demonstrated how we can add value to traditional broadcast environments through the application of digital technology by winning the contract to produce the Champ Car racing series. We are now engaged in the process of acquiring a stake in Satellite Information Services, based in London, who are one of the world's largest producers of live sport and an ideal potential partner to develop interactive solutions for the horse racing and betting industries. I am confident that the Group will make a profit for the current financial year and that we will continue to grow strongly. Paul Duffen Chief Executive Officer UNAUDITED RESULTS FOR THE SIX MONTHS ENDED 30 APRIL 2004 Consolidated Profit and Loss Account Note Six months ended Six months ended Year ended 30 April 2004 30 April 2003 31 Oct 2003 £ £ £ Turnover 2 Existing operations 420,317 113,505 226,751 Acquisitions 1,234,754 - 37,771 Continuing operations 1,655,071 113,505 264,522 Cost of sales (980,081) (47,553) (118,485) Gross profit 674,990 65,952 146,037 Operating expenses 3 (1,386,989) (2,492,214) (6,666,803) Operating loss Existing operations (895,642) (2,426,262) (6,513,687) Acquisitions 183,643 - (7,079) (711,999) (2,426,262) (6,520,766) Interest receivable 7,912 1,068 7,673 Interest payable (5,796) (1,000) (15,341) Loss on ordinary activities before taxation (709,883) (2,426,194) (6,528,434) Taxation (500) - 204,269 Loss on ordinary activities after taxation (710,383) (2,426,194) (6,324,165) Loss per ordinary share - basic 4 (0.56p) (3.49p) (7.88p) Consolidated Balance Sheet Note At At At 30 April 2004 30 April 2003 31 Oct 2003 £ £ £ Fixed assets Intangible assets 5 8,350,070 2,071,624 3,342,067 Tangible assets 254,733 183,108 171,617 8,604,803 2,254,732 3,513,684 Current assets Debtors 6 2,057,932 218,066 186,595 Cash at bank and in hand 1,356,073 100,252 587,323 Creditors: amounts falling due within one year 7 (4,146,286) (560,055) (1,896,570) Net liabilities (732,281) (241,737) (1,122,652) Total assets less current liabilities 7,872,522 2,012,995 2,391,032 Creditors: amounts falling due after more than 8 (2,559,860) (160,000) (160,000) one year Total net assets 5,312,662 1,852,995 2,231,032 Capital and Reserves £ £ £ Called up share capital 9 1,405,099 722,688 1,214,624 Shares to be issued 1,012,640 - 1,012,640 Share premium account 15,308,182 11,827,380 12,775,192 Merger reserve 2,402,674 (509,386) 1,295,676 Profit and loss account (14,815,933) (10,187,687) (14,069,092) Equity shareholders' funds 10 5,312,662 1,852,995 2,229,040 Minority interest - - 1,992 5,312,662 1,852,995 2,231,032 Consolidated Cash Flow Statement Note Six months ended Six months ended Year ended 30 April 2004 30 April 2003 31 Oct 2003 £ £ £ Net cash outflow from operating activities 11 (1,238,742) (649,690) (1,355,300) Returns on investment and servicing of finance 6,917 1,068 (1,013) Taxation (500) - 204,436 Capital expenditure and financial investment (9,992) - (76,922) Acquisitions (358,449) - (131,825) Cash outflow before financing (1,600,766) (648,622) (1,360,624) Financing New unsecured loan - 160,000 160,000 Issue of shares 2,665,202 150,000 1,349,073 Repayment of bank loan (263,318) - - Repayment of loan notes (32,368) - - 2,369,516 310,000 1,509,073 Increase/(decrease) in cash 768,750 (338,622) 148,449 Notes 1. Accounting policies and additional information These interim results for the six month period ended 30 April 2004 do not constitute statutory accounts and have been neither reviewed nor audited by our auditors. The financial information for the year ended 31 October 2003 is derived from the statutory accounts for that year which have been delivered to the Registrar of Companies. The auditors reported on those accounts; their report was unqualified and did not contain a statement under s237(2) or (3) Companies Act 1985. The accounting policies are consistent with those applied in the preparation of the statutory accounts for the year ended 31 October 2003. 2. Turnover Turnover represents amounts derived from the provision of services which fall within the group's ordinary activities after deduction of trade discounts and value added tax. 3. Operating expenses Six months Six months Year ended ended ended 31 Oct 2003 30 April 2004 30 April 2003 £ £ £ Included in operating expenses: Amortisation of goodwill 213,593 14,693 65,358 Depreciation 52,673 54,262 92,827 266,266 68,955 158,185 4. Loss per share The calculation of loss per share has been based on the loss after taxation for the period of £710,383 and the weighted average number of ordinary shares in issue during the period of 125,990,580. 5. Intangible fixed assets Goodwill Intellectual Property Total £ £ £ Cost At 1 November 2003 3,426,899 4,213,834 7,640,733 Additions 5,254,466 - 5,254,466 Exchange adjustments (36,193) - (36,193) At 30 April 2004 8,645,172 4,213,834 12,859,006 Amortisation At 1 November 2003 (84,832) (4,213,834) (4,298,666) Charge for the 6 months (213,593) - (213,593) Exchange adjustments 3,323 - 3,323 At 30 April 2004 (295,102) (4,213,834) (4,508,936) Net book value At 30 April 2004 8,350,070 - 8,350,070 At 31 October 2003 3,342,067 - 3,342,067 6. Debtors At At 30 April 2004 31 Oct 2003 £ £ Trade debtors 1,347,638 89,069 Other debtors 367,522 53,608 Prepayments and accrued income 342,772 43,918 2,057,932 186,595 7. Creditors: amounts falling due within one year At At 30 April 2004 31 Oct 2003 £ £ Trade creditors 1,238,353 275,370 Loan notes 339,205 - Taxation and social security 42,329 32,419 Other creditors 1,536,352 905,031 Accruals and deferred income 930,047 683,750 4,146,286 1,896,570 8. Creditors: amounts falling due after more than one year At At 30 April 2004 31 Oct 2003 £ £ Bank loan 789,221 - Loan notes to BPI vendors 765,144 - Convertible loan notes 2006 160,000 160,000 Other creditors 845,495 - 2,559,860 160,000 9. Changes in share capital In November 2003 David Holdgate subscribed for 125,000 new shares at a price of 20p per share. On 27 February 2004 the authorised share capital of the Company was increased to £2,000,000. On 21 April 2004 the Company issued 5,826,305 ordinary 1p shares at a price of 20p per share for a total consideration of £1,165,261 in respect of vendor consideration of Betelgeuse Productions Inc. 10. Reconciliation of movement in shareholders' funds Six months ended Six months ended Year ended 30 April 2004 30 April 2003 31 Oct 2003 £ £ £ Loss for the period (710,383) (2,426,194) (6,324,165) Issue of shares (net of issue costs) 2,723,465 150,000 1,589,748 Premium on issue of shares for acquisition 1,106,998 - 1,805,062 Currency translation difference (36,458) - 16,566 Shares to be issued - - 1,012,640 Net increase/(reduction) in shareholders' 3,083,622 (2,276,194) (1,900,149) funds Opening shareholders' funds 2,229,040 4,129,189 4,129,189 Closing shareholders' funds 5,312,662 1,852,995 2,229,040 11. Reconciliation of operating loss to operating cashflows Six months ended Six months ended Year ended 30 April 2004 30 April 2003 31 Oct 2003 £ £ £ Operating loss (711,999) (2,426,262) (6,520,766) Impairment of Intellectual property rights - - 1,995,235 Amortisation of Intellectual property rights - 351,331 555,101 Prepayment write off - - 682,058 Depreciation 52,673 54,262 92,827 Exceptional non-cash charges - 971,865 - Loss on disposal of fixed assets - - 12,755 Amortisation of goodwill on acquisition 213,593 14,693 65,358 (Increase)/decrease in debtors (790,862) 167,714 199,019 Increase in creditors 85,161 216,707 1,549,559 Exchange adjustment (87,308) - 13,554 Net cash outflow from operating activities (1,238,742) (649,690) (1,355,300) 12. Reconciliation of net cash flow to movement in net (debt)/funds At At 30 April 2004 31 Oct 2003 £ £ Increase in cash in the period 768,750 148,449 Issue of convertible loan note - (160,000) Loans and finance leases acquired with subsidiary (2,177,830) - Translation difference (71,426) - Repayment of loan notes 32,368 - Repayment of bank loan 263,318 - Movement in debt in the period (1,184,820) (11,551) Net funds at start of period 427,323 438,874 Net (debt)/funds at end of period (757,497) 427,323 13. Analysis of net (debt)/funds At 31 October Cash flow Acquired Exchange At 30 April 2003 2004 £ £ Movement £ £ £ Cash at bank 587,323 768,750 - - 1,356,073 Bank loan - 263,318 (1,012,598) (39,942) (789,222) Convertible loan note (160,000) - - - (160,000) Loan notes - 32,368 (1,165,232) (31,484) (1,164,348) 427,323 1,064,436 (2,177,830) (71,426) (757,497) This Interim Report was approved by the Directors on 30 June 2004. The report will be sent to all registered shareholders and will be available to members of the public from the Company's registered office at 12 Gough Square, London EC4A 3DW and online from the Company's corporate website at www.CMG-plc.com. This information is provided by RNS The company news service from the London Stock Exchange

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