Interim Results

Parallel Media Group PLC 09 August 2005 Parallel Media Group plc Interim Results for the 6 months ended 30 June 2005 Chairman's statement The Company's interim results for the period ended 30 June 2005 show a retained loss of £218,000 compared to a loss of £892,000 reported in last year's interim results. During the six months to 30 June 2005 the Company, together with its 49.9% associate, Parallel Media Asia (2003) Limited (PMA), launched two new PGA European Tour golf events in China and Indonesia and two new Ladies European Tour events in Singapore and Thailand. This period also saw the Company, together with PMA, successfully stage PGA European Tour events in Malaysia, Singapore and China. Financial review The turnover for the period was £1,923,000 compared to a turnover of £1,861,000 (after the deduction share of joint venture turnover) in the prior period. The operating loss for the period was £110,000 (6 months ended 30 June 2004: £531,000). The share of profit in associates line is the Group's 49.9% share of the profit of PMA for the period. Interest payable of £131,000 relates to interest paid on the US$3 million facility with Bumiputra Commerce Bank and interest paid on convertible and shareholders loans. At 30 June 2005 the Group had a net short term overdraft position of £10,000. The creditors falling due after more than one year comprised of a proportion of the Bumiputra Commerce Bank facility, convertible loans and shareholder loans. As indicated in the Chairman's Statement in the 31 December 2004 Report and Accounts and the subsequent circular dated 30 June 2005, the Company has been looking to raise monies in order to have sufficient working capital to develop and increase its business over the next 12 months. I am therefore pleased to announce that the Company has today received minimum commitments for a cash injection of £750,000. The commitments have been made by myself and RAM Investment Group plc. The cash injection is to be in the form of convertible loans, with a conversion price of 1.5p per share. Board changes Tan Sri Mohd Razali Abdul Rahman is standing down as Chairman of the Company in order to be able to devote more time to his role as Chairman of PMA and I would like to take this opportunity to thank him for his tremendous support over the last two years and look forward to a continued close relationship with him in the future. Snowy Invest & Trade Inc. will continue to have two directors on the Company's board. The Company will be announcing non-executive additions to the board in the Autumn including a new Non-Executive Chairman. In the meantime I will temporarily be taking on the role of both Chairman and CEO. David Ciclitira Chairman & CEO 9 August 2005 Consolidated profit and loss account for the 6 months ended 30 June 2005 6 months ended 6 months ended Year ended 30 June 30 June 31 December 2005 2004 2004 (unaudited) (unaudited) (audited) Note £'000 £'000 £'000 Turnover: Group and share of joint venture 1,923 2,584 3,702 Less share of turnover of joint venture - (723) (723) Turnover 1,923 1,861 2,979 Cost of Sales (1,321) (1,242) (1,943) Gross profit 602 619 1,036 Administrative Expenses (712) (1,150) (2,474) Other operating Income - - - Operating loss before exceptional items (110) (531) (1,288) Administrative expenses - exceptional - - (150) Operating loss (110) (531) (1,438) Share of operating loss in joint ventures - (226) (226) Share of operating profit/(loss) in associates 19 (192) (672) Exceptional items - profit on partial disposal of a subsidiary - - 16 Loss on ordinary activities before interest and tax (91) (949) (2,320) Interest receivable - - 1 Interest payable (131) (57) (397) Loss on ordinary activities before tax (222) (1,006) (2,716) Tax on loss on ordinary activities - - Loss on ordinary activities after tax (222) (1,006) (2,716) Minority interests 4 114 144 Loss for the financial period (218) (892) (2,572) Loss per share - basic and diluted 2 (0.98p) (4.02p) (11.58p) - adjusted 2 (0.98p) (4.02p) (10.98p) Consolidated balance sheet as at 30 June 2005 30 June 30 June 31 December 2005 2004 2004 (unaudited) (unaudited) (audited) £'000 £'000 £'000 Fixed assets Tangible assets 59 78 62 Investments 757 1,206 883 816 1,284 945 Current assets Debtors - Due within one year 914 1,363 923 - Due after one year 1,971 1,750 1,890 2,885 3,113 2,813 Cash - 7 47 2,855 3,120 2,860 Creditors: amounts falling due within one year (2,361) (2,923) (2,003) Net current assets/(liabilities) 524 197 857 Total assets less current liabilities 1,340 1,481 1,802 Creditors: amounts falling due after one year (5,412) (3,605) (5,468) Provisions for liabilities and charges Associates (156) (156) (156) Net liabilities (4,228) (2,280) (3,822) Capital and reserves Called up share capital 1,110 1,110 1,110 Share premium account - - - Other reserves 5,591 5,591 5,591 Profit and loss account (10,821) (8,895) (10,413) Shareholders' funds - equity (4,120) (2,194) (3,712) Minority interest - equity (108) (86) (110) (4,228) (2,280) (3,822) Consolidated cash flow statement for the 6 months ended 30 June 2005 6 months ended 6 months ended 30 June 2005 30 June 2004 Note £'000 £'000 Net cash outflow from operating activities 3 80 (1,294) Returns on investments and servicing of finance Interest paid (131) (57) Interest received - - Net cash outflow from returns on investments and servicing of finance (131) (57) Tax paid - - Capital expenditure - - Acquisitions and disposals - - Further investment in associated undertaking - (158) Net cash sold with subsidiary - (242) - (400) Net cash outflow before management of liquid resources & (51) (1,751) financing Financing Convertible loan - 678 Loan from director - 514 - 1,192 Decrease in cash (51) (559) Notes forming part of the interim results for the period ended 30 June 2005 1. Accounting policies The interim results have been prepared on the basis of the accounting policies as set out in the Group's 31 December 2004 statutory accounts. The comparative figures show above for the period ended 31 December 2004 do not constitute statutory accounts as they have been extracted from the statutory accounts which have been filed with the Registrar of Companies. The auditors' report on those financial statements which was issued on 29 June 2005 contained a reference to a fundamental uncertainty, details of which are shown below. Fundamental uncertainties In forming our opinion, we have considered the adequacy of the disclosures made in note 1 of the financial statements concerning the assumptions underlying the directors' financial forecasts and the consequent uncertainty over the appropriateness of the going concern basis of accounting. We have also considered the disclosures made in notes 14 and 15 concerning the uncertainty over the carrying value (in the company's balance sheet) of the investment in subsidiaries and the recoverability of the amounts owed by associated companies. In view of the significance of these uncertainties we consider that they should be drawn to your attention, but our opinion is not qualified in this respect. The accounting policies included in the financial statements for the year ended 31 December 2004 included the following basis of preparation note. Basis of preparation - Going concern The directors have prepared trading and cash flow forecasts for the group for the 30 month period to 31 December 2007. These forecasts incorporate, inter alia, the following assumptions:- a) as stated in the Chairman's statement, there will be a further cash injection of £750,000 in the company in the near future b) the company's associated undertaking, Parallel Media Golf (Asia) Ltd ('PMGA '), will continue to repay its debt due to the company at the rate of $60,000 per month (plus interest) c) the directors are in discussion with the directors of Parallel Media Asia (2003) Ltd an associated undertaking of the Company with a view to strengthening the latter's financial position by means of a substantial cash injection d) certain creditors will continue to acquiesce in receiving payment in instalments Based on the above assumptions, the directors believe these forecasts to be realistic, and consequently have prepared the financial statements on the going concern basis, which assumes that the group will continue in operational existence for the foreseeable future. If any or all of the above assumptions prove to be inaccurate, the going concern basis might not be appropriate, and the financial statements do not contain any adjustments which might prove necessary as a consequence thereof. These interim results are unaudited and do not constitute statutory accounts. 2. Loss per share (i) Basic 6 months 6 months ended Year ended ended 30 June 2004 31 December 2004 30 June 2005 (unaudited) (unaudited) (audited) Loss for the financial period (£218,000) (£892,000) (£2,572,000) Number of shares in issue 22,203,505 22,203,505 22,203,505 Loss per share (0.98p) (4.02p) (11.58p) (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) 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 profit excluding goodwill, 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. 6 months ended 6 months ended Year ended 30 June 2005 30 June 2004 31 December 2004 (unaudited) (unaudited) (audited) Earnings EPS Earnings EPS Earnings EPS £'000s Pence £'000s Pence £'000s Pence Basic loss per share (218) (0.98p) (892) (4.02p) (2,572) (11.58p) Administrative expenses - Exceptional - - - - 150 0.67p Exceptional items - - - - (16) (0.07p) Adjusted loss per share (218) (0.98p) (892) (4.02p) (2,438) (10.98p) 3. Reconciliation of operating loss to net cash outflow from operating activities 6 months ended 6 months ended 30 June 2005 30 June 2004 £'000 £'000 Operating loss after exceptional items (110) (531) Depreciation 2 7 Gain on disposal of - (16) subsidiaries (Increase)/decrease in debtors (112) (841) (Decrease)/Increase in 301 88 creditors Foreign exchange (1) (1) Net cash outflow from operating activities (80) (1,294) 4. Other Copies of unaudited interim results have not been sent to shareholders, however copies are available on request from the Company Secretary at the company's Registered Office: 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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