Final Results

Parallel Media Group PLC 30 June 2005 Parallel Media Group plc Preliminary announcement of the financial results for the year ended 31 December 2004 Chairman's statement I am pleased to report that this year has seen the further development of PMG's unique golfing assets. The key changes since 31 December 2003 to date can be summarised as follows: • The acquisition in March 2004 through its 49.975% associate Parallel Media (2003) Asia Limited ('PMA') of 100% of the Asian PGA Tour Limited, now renamed, Parallel Media Golf Asia Limited ('ATL'). ATL currently has the right to, and has recently promoted, the following five PGA European Tour/Asian Tour co-sanctioned events: Hong Kong Open, Singapore Masters, Malaysian Open, TCL Classic and a new event, the Indonesian Open, which was staged between 24 to 27 March 2005 making the Group the largest single promoter on the PGA European and Asian Tours. • The signing of an agreement on March 17th 2004 with the PGA European Tour for the creation of an 'Asian Swing' within their European Tour Schedule. Under this agreement the PGA European Tour and ATL act as joint promoters of ATL's existing events and selected future events. PMG also has the exclusive right to market the commercial rights to the Asian Swing and has appointed PMA as its sponsorship and sales marketing agent. PMG also has the right to jointly exploit the television rights to the Swing with the PGAET. • The launching of two new Ladies European Tour co-sanctioned events in Singapore and Thailand - the Samsung Ladies Masters in Singapore (February 2005) and the Thailand Ladies Open (April 2005). • The launching of a new Tour De Las Americas Tournament, The American Express Dominican Republic Open held at Casa del Campo. • The announcement on 28 April 2005 of a new Challenge Tour Event, - the Kazakhstan Open, to be staged between 22 to 25 September 2005 Turnover for the year ended 31 December 2004 was £3.7 million with a loss of £2.6 million as opposed to a turnover of £7.5 million and a loss of £4.3 million for the period ending 31 December 2003. (The difference in turnover being due to the fact that Parallel Media Asia (2003) Limited ('PMA') is now an associate of the Company as opposed to a subsidiary, PMG now currently owns 49.975% of PMA). Now that the Group has control of its assets I am pleased to indicate that there has been a significant improvement in trading in 2005. Whilst the Company's business has been without doubt strengthened, the Directors feel that it is prudent to ensure that the Group and its associated companies have enough working capital to develop and increase their business over the next 12 months. To strengthen the Company's working capital position, the Company is proposing to raise between £750,000 and £1.1 million from investors by a new issue of convertible secured loan stock. Agreement in principal has been reached for David Ciclitira and an external investor to subscribe approximately a further £750,000 into the Company by way of a three year convertible loan which is convertible at 1.5p per ordinary share. Details of this, together with some proposed changes to the share capital structure required to implement the proposals are set out in a separate document which will be sent to shareholders. Outlook The last 18 months have been an extraordinary period for the Group; to have promoted seven major events in the first three months of this new financial year is an achievement that everybody is proud of. The Company now appears to be in a better position to generate growth and I am proud to have been able to assist over the last 18 months particularly in the area of Asia, which I know so well. Tan Sri Mohd Razali Abdul Rahman Chairman Consolidated profit and loss account for the year ended 31 December 2004 Period Year ended 23 January 2003 to 31 December 2004 31 December 2003 Note £'000 £'000 Turnover: Group and share of joint venture 3,702 7,545 Less share of turnover of joint venture (723) (3,439) Turnover 2,979 4,106 Cost of Sales (1,943) (1,928) Gross Profit 1,036 2,178 Administrative Expenses (2,474) (5,380) Other operating Income - - Operating loss before exceptional items (1,288) (2,793) Administrative expenses - exceptional (150) (409) Operating Loss 1 (1,438) (3,202) Share of operating loss in joint ventures (226) (2,566) Share of operating (loss)/profit in associates (672) 314 Exceptional items - profit on sale of - 247 subsidiary Exceptional items - loss on sale of associated undertaking - (180) Exceptional items - profit on partial disposal of subsidiary 16 - Loss on ordinary activities before interest and tax (2,320) (5,387) Interest receivable 1 - Interest payable (397) (147) Loss on ordinary activities before tax (2,716) (5,534) Tax on loss on ordinary activities - (3) Loss on ordinary activities after tax (2,716) (5,537) Minority interests 144 1,192 Loss for the financial period (2,572) (4,345) Loss per share - basic and diluted 2 (11.58p) (19.57p) - adjusted 2 (10.98p) (17.95p) Balance sheets at 31 December 2004 Group Company 31 December 31 December 31 December 31 December 2004 2003 2004 2003 £'000 £'000 £'000 £'000 Fixed assets Intangible assets - - - - Tangible assets 62 89 9 11 Joint venture - share of gross assets - 705 - - Joint venture - share of gross - (2,474) - - liabilities Goodwill in joint venture - 1,817 - - - 48 - - Investments 883 224 3,010 2,822 945 361 3,019 2,833 Current assets Debtors - Due within one year 923 1,130 1,449 1,680 - Due after one year 1,890 2,000 1,890 1,259 2,813 3,130 3,339 2,939 Cash 47 565 - 201 2,860 3,695 3,339 3,140 Creditors: amounts falling due within one year (2,003) (3,514) (1,447) (2,656) Net current assets 857 181 1,892 484 Total assets less current liabilities 1,802 542 4,911 3,317 Creditors: amounts falling due after one year: (5,468) (2,401) (5,468) (2,401) Provisions for liabilities and charges Associates (156) (156) - - Net (liabilities)/assets (3,822) (2,015) (557) 916 Capital and reserves Called up share capital 1,110 1,110 1,110 1,110 Share premium account - - - - Other reserves 5,591 5,591 5,591 5,591 Profit and loss account (10,413) (7,984) (7,258) (5,785) Shareholders' funds - equity (3,712) (1,283) (557) 916 Minority interest - equity (110) (732) - - (3,822) (2,015) (557) 916 Consolidated cash flow statement for the year ended 31 December 2004 31 December 31 December 31 December 31 December 2004 2004 2003 2003 £'000 £'000 £'000 £'000 Net cash outflow from operating activities (2,404) (5,347) Returns on investments and servicing of finance Interest paid (397) (147) Interest received 1 - Dividend received from associated undertaking - 85 Net cash outflow from returns on investments and servicing of finance (396) (62) Tax paid Corporation tax refund - - Overseas withholding tax paid - (3) - (3) Capital expenditure Payments to acquire tangible fixed assets (48) (108) Receipts from sales of tangible fixed - 28 assets Net cash outflow from capital expenditure and financial investment (48) (80) Acquisitions and disposals Further investment in associated undertaking (158) - Sale of subsidiary undertaking - 500 Net (cash)/overdrafts sold with subsidiary (242) (33) Purchase of other investments (30) Sale of associated undertaking - 86 Sale of other investments - 14 (430) 567 Net cash outflow before management of liquid resources & financing (3,278) (4,925) Financing Proceeds from new ordinary share issues - - Bank facility 1,562 - Proceeds from shares issued in - 596 subsidiaries Convertible loan 678 2,220 Loan from shareholder - - Loan from director 514 - 2,754 2,816 Decrease in cash (524) (2,109) 1. Operating loss on ordinary activities before tax Year ended Period ended 31 December 31 December 2004 2003 £'000 £'000 This is stated after charging/(crediting) Depreciation 32 95 Hire of other assets - operating leases 150 141 Loss on foreign exchange 177 162 Auditors' remuneration - audit fee Company 17 20 - audit fee rest of group 30 40 Fees payable to the auditor and its associates in respect of non-audit services amount to £20,000 (period ended 31 December 2003: £23,525). The exceptional items included in administrative expenses for the year comprise provisions against amounts owed from associates of £150,000 (period ended 31 December 2003: provisions against loans receivable of £409,000). 2. Loss per share Year ended Period ended 31 December 31 December 2004 2003 (i) Basic £'000 £'000 Loss for the financial period (2,572) (4,345) Number of shares in issue 22,203,505 22,203,505 Loss per share (11.58p) (19.57p) (ii) Diluted Diluted loss and earnings per share is calculated on the same basis as basic loss and earnings per share because the effect of the potential ordinary shares (share options and convertible loans) reduces the net loss per share and is therefore anti-dilutive. (iii) Adjusted earnings per share The adjusted earnings per share figure shown below is calculated on attributable loss excluding discontinued operations, exceptional items included in administrative expenses, and exceptional items included after operating profit. This calculation has been used as it is deemed to give a more appropriate indication of the earnings of the continuing operations of the Group. Year ended Period ended 31 December 2004 31 December 2003 EPS Earnings EPS Earnings Pence £'000 Pence £'000 Basic loss per share (11.58p) (2,572) (19.57p) (4,345) Discontinued operations - - (0.22p) (49) Administrative expenses - Exceptional (continuing operations only) 0.67p 150 1.84p 409 Exceptional items (continuing operations only) (0.07p) (16) - - Adjusted loss per share (10.98p) (2,438) (17.95p) (3,985) The financial information set out above does not constitute the Company's statutory accounts for the year to 31 December 2004 but is derived from those accounts. Copies of the Report and Accounts for the period ended 31 December 2004 are being sent to shareholders. Further copies will be available from the Company's registered office, which is 56 Ennismore Gardens, London, SW7 1AJ. This information is provided by RNS The company news service from the London Stock Exchange

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