Final Results
CERES MEDIA INTERNATIONAL PLC
("Ceres" or the "Company" or the "Group")
Final Results to 31 July 2011
CHAIRMAN'S STATEMENT
I am pleased to present shareholders with the Report and Accounts for the year
to 31 July 2011. In my last statement made on 28 April 2011 reporting on the 6
months activities to 31 January 2011 for Hartfield Securities PLC (as the
company was then called) I advised shareholders of the board's intention to
acquire Ceres Media PLC, a company that had developed natural sustainable
environmental advertising and marketing products for companies seeking to
promote their products, brands and corporate social responsibility through the
use of natural materials.
On 17 March 2011 the Company made a recommended offer for the entire issued
share capital of Ceres Media PLC which was declared unconditional in all
respects and Ceres Media PLC ultimately became a wholly owned subsidiary of the
Company (the "Acquisition"). Ceres Media PLC is the holding company for its
wholly-owned subsidiary Natural AdCampaign whose products include advertising,
promotional and public relations products as well as a full selection of
printed products using its patent-pending NatureWovenTM range of digitally
printable materials.
On 9 May 2011 the Company withdrew its listing to trading on PLUS Markets and
changed its name from Hartfield Securities PLC to Ceres Media International
PLC.
For the period to 31 July 2011 the Group recorded revenues of £30k.
PLACING AND ADMISSION TO AIM
On 9 September 2011 the Company raised £1m by way of a placing of 5,555,556 new
ordinary shares and was admitted to trading on AIM ("Admission").
DIRECTORATE CHANGES
On 9 May 2011, following the Acquisition, Gerald Raingold, Malcolm Coleman and
Brian Leader-Cramer stepped down from the board. I would like to thank them for
their hard work and efforts over the last number of years. Also on 9 May 2011
Alex Dowdeswell was appointed as Chief Executive Officer, Matthew Howes as
Finance Director and Leslie Barber as a Non-executive Director. I would like to
welcome them to the board.
UPDATE
Since Admission Ceres Media has continued to invest in product development,
intellectual property protection and commercialisation of its products and
continues to work on expanding its sales and marketing and improving quality
control with its manufacturing partners.
Work has been ongoing with the expansion of the distributor network within the
United Kingdom, the United States of America and Europe.
The NatureWovenTM range of products includes:-
"Chorus", a jute based material with a natural look and feel that enhances the
credentials of the printed branding, and
"Gossyp", a cotton based fabric which provides fine print detail, enabling
images to look very similar to how they appear when printed on PVC.
Both Chorus and Gossyp are stocked across a number of international territories
and are being used in a number of different areas within the display market.
Ceres Media is focussing on increasing awareness of its products in its target
markets and has accordingly strengthened its sales force. Whilst sales levels
have been modest to date they will continue to improve as Ceres Media benefits
from better market awareness, new sales territories and the additional products
being available to the market.
The board has noted that the demand for Chorus and Gossyp has varied according
to geographic market. The board is refocusing it sales and marketing strategy
in certain markets on end-users to "pull" demand for the product rather than
the more traditional method of targeting printers and distributors to "push"
demand. The board is hopeful this refocusing will lead to a faster take-up of
Chorus and Gossyp product across all market sectors, which to date has been
slower than anticipated.
Ceres Media's TierraFilmTM product, "window film" is due to be available in the
United Kingdom market in November 2011 in commercial volumes. Certain key
distributors and printers have already been trialling test batches with
positive feedback.
Ceres Media originally projected that TierraFilmTM would be commercially
available in the United Kingdom in early October 2011, however, it has
experienced a delay in delivering the TierraFilmTM window film into the market
due to a product refinement to more fully meet end users expectations.
This delay has pushed back the anticipated sales by 2 -3 months, however the
board remains hopeful that the Company will meet its sales budget in the
current year.
I would like to thank my colleagues on the board, our employees and
distributors, for all the hard work during the last year, and look forward to
reporting further progress in the months ahead.
Norman Fetterman
Chairman
Consolidated Statement of Comprehensive Income for the period 1 March 2011 to
31 July 2011
Period 1 March Period 1 March
2011 to 31 July 2011 to 28
2011 February 2011
£ As restated
£
CONTINUING OPERATIONS
Revenue 30,054 2,342
Cost of sales (37,688) -
Administrative expenses (472,532) (258,752)
OPERATING LOSS (480,166) (256,410)
Interest income 250 -
Finance costs (4,859) -
LOSS BEFORE INCOME TAX (484,775) (256,410)
Income tax - -
TOTAL COMPREHENSIVE EXPENSE FOR (484,775) (256,410)
THE YEAR
LOSS PER SHARE
BASIC AND DILUTED LOSS PER SHARE 0.021 0.013
The comparatives are noted as restated as they relate to Ceres Media Plc. See
Principal Accounting Policies for further details.
All of the activities of the Group are classed as continuing.
31 July 2011 28 February
2011
£
(as
restated)
£
ASSETS
NON-CURRENT ASSETS
Goodwill 868,088 129,442
Intangible assets 223,306 217,800
Property, plant and equipment 9,057 3,440
Investments - -
Trade and other receivables - 10,000
1,100,451 360,682
CURRENT ASSETS
Inventories 162,663 48,193
Trade and other receivables 98,313 51,607
Cash and cash equivalents 55,911 13,528
316,887 113,328
TOTAL ASSETS 1,417,338 474,010
EQUITY
SHAREHOLDERS' EQUITY
Called up share capital 5,200,348 150,539
Share premium - 419,249
Other reserves (3,444,552) -
Retained earnings (875,172) (390,397)
TOTAL EQUITY 880,624 179,391
LIABILITIES
CURRENT LIABILITIES
Trade and other payables 536,714 199,944
Financial liabilities: borrowings
Interest bearing loans and borrowings - 94,675
TOTAL LIABILITIES 536,714 294,619
TOTAL EQUITY AND LIABILITIES 1,417,338 474,010
Consolidated Statement of Financial position for the period 1 March 2011 to 31
July 2011
Consolidated Statement of Cash Flows fir the period 1 March 2011 to 31 July
2011
Period to Period to
31 July 28 February
2011 2011
£ As restated
£
Cash flows from operating activities
Loss before income tax (484,775) (256,410)
Depreciation charges 1,304 1,616
Investment income (250) -
Increase in inventories (114,470) (48,193)
Increase in trade and other receivables 50,144 (50,424)
Increase in trade and other payables 229,629 158,259
Costs settled by issue of shares - -
Net cash from operating activities (318,418) (195,152)
Cash flows from investing activities (28,006) (75,181)
Purchase of intangible fixed assets
Purchase of tangible fixed assets (6,921) (826)
Acquisition of subsidiaries, net of cash 385,144 -
Finance income received 250 -
Movement in balances with other Group companies - -
Net cash from investing activities 350,467 (76,007)
Cash flows from financing activities
New loans in year - 94,675
Amount withdrawn by directors - (22,086)
Share issue 10,334 219,866
Net cash from financing activities 10,334 292,455
Increase/(Decrease) in cash and cash 42,383 21,296
equivalents
Cash and cash equivalents at beginning of 13,528 (7,768)
period
Cash and cash equivalents at end of period 55,911 13,528
CASH AND CASH EQUIVALENTS
The amounts disclosed on the statement of cash flow in respect of cash and cash
equivalents are in respect of these statement of financial position amounts:
31 July 2011 28 February 2011
£ As restated
£
Cash and cash equivalents 55,911 13,528
Bank overdrafts - -
Notes:
1 ACCOUNTING POLICIES
Basis of preparation
These financial statements have been prepared in accordance with International
Financial Reporting Standards and IFRIC interpretations and with those parts of
the Companies Act 2006 applicable to companies reporting under IFRS. The
financial statements have been prepared under the historical cost convention.
The preparation of financial statements in conformity with generally accepted
accounting principles requires the use of estimates and assumptions that effect
the reported amounts of assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Although these estimates are based on management's best
knowledge of the amount, actual results may differ from those of estimates.
The principal accounting policies are summarised below. They have all been
applied consistently throughout the period under review.
Standards, amendments and interpretations effective in 2011 but not relevant
The following new standards, amendments and interpretations to published
standards are mandatory for accounting periods beginning on or after 1 February
2011 but are not relevant to the company's operations:
* IFRIC 17 Distribution of Non Cash Assets to Owners
* IFRIC 19 Transfers of Assets from Customers
* IFRS 3 (revised) Business Combinations
* IAS 27 (amended) Consolidated and Separate Financial Statements
* IFRS 1 (revised) First Time Adoption of IFRS
* IFRS 1 and IAS 27 (amendments) Cost of an Investment in a Subsidiary,
Jointly Controlled Equity or Associate
* IAS 39 (amendment) Financial Instruments- Recognition and Measurement:
Eligible Hedged Items
* IFRIC 9 and IAS 39 (amendment) Embedded Derivatives
* IFRS 1 (amendment) Additional exemptions for first time adopters
* IFRS 2 Group cash settled share based payment transactions
* Improvements to IFRS's (issued April 2009)
Standards, amendments and interpretations to existing standards that are not
yet effective and have not been early adopted by the Ceres Media Group
The following standards, amendments and interpretation to existing standards
were in issue at the date of authorisation of these financial statements, but
are not yet effective, and in some cases have not been adopted by the EU:
* IFRIC 19 Extinguished Financial Liabilities with Equity Instruments
* IFRIC 14 (amendment) Prepayment of minimum funding requirement
* IFRS 1 (amendment) Limited exemption from comparative IFRS 7 disclosure for
first-time adopters
* IAS 32 (amendment) Financial instruments: Presentation: clarification of
rights issue
* IAS 24 (revised) Related Party Disclosures
* IFRS 9 Financial Instruments
* IFRS 7 (amendment) Financial Instruments Disclosures
* Improvements to IFRS (issued May 2010)
* IAS 12 (amendment) Deferred tax: Recovery of Underlying Assets
* IFRS 1 (amendment) Severe Hyperinflation and removal of fixed dates for
first-time adopters
The directors of Ceres Media do not anticipate any material impact on the
company's financial statements when the standards and interpretations become
effective.
Basis of consolidation
The Group financial statements consolidate the financial statements of the
Company and all of its subsidiaries.
On 9 May 2011, Ceres Media International Plc (formerly Hartfield Securities
Plc) became the legal parent of Ceres Media Plc in a share-for-share exchange.
In accordance with IFRS 3 `Business combinations', this transaction has been
accounted for as a reverse acquisition, such that in substance, Ceres Media Plc
has acquired Ceres Media International Plc. Accordingly, the comparative
information for Ceres Media Plc has been presented for the period ended 28
February 2011 and these financial statements present a continuation of the
business of Ceres Media Plc as the legal subsidiary.
Going concern
Since the balance sheet date the Ceres Media Plc group has been funded by Ceres
Media International Plc, a Company incorporated in England and Wales. The
directors anticipated that support will continue on this basis consider it
appropriate to prepare the financial statements on the going concern basis. The
financial statements do not include any adjustments that would result from
withdrawal of support.
Revenue recognition
Revenue represents amounts receivable for goods and services net of VAT and
trade discounts.
Revenue is recognised when the significant risks and rewards of ownership of
the goods have passed to the buyer and the amount of revenue can be measured
reliably.
Investments
Investments in subsidiaries are held at cost less any impairment.
Intangible assets
An intangible asset, which is an identifiable non-monetary asset without
physical substance, is recognised to the extent that it is probable that the
expected future economic benefits attributable to the asset will flow to the
Group and that its cost can be reliably measured. The asset is deemed to be
identifiable when it is separable or when it arises from contractual or legal
rights.
Goodwill
Goodwill represents any excess of the cost of acquisition over the fair value
of the identifiable assets and liabilities acquired. Goodwill is tested
annually for impairment and is earned at cost less accumulated impairment
losses.
Property, plant and equipment
Depreciation is provided at the following annual rates in order to write off
each asset over its estimated useful life.
Plant and machinery - 25% on cost
Financial instruments
Financial assets and liabilities are recognised at fair value in the Group's
balance sheet when the Group becomes a party to the contractual provisions of
the instrument.
The Group classifies its financial instruments into loans and receivables
(comprising cash and trade receivables) and other liabilities (comprising trade
payables).
Inventories
Inventories are valued at the lower of cost and net realisable value, after
making due allowance for obsolete and slow moving items
Trade and other receivables
Trade and other receivables do not carry any interest and are stated at their
nominal value unadjusted to reflect discounting for the time value of cash
flows recoverable and are reduced by appropriate allowances for estimated
irrecoverable amounts.
Cash and cash equivalents
Cash and cash equivalents comprise cash in hand and deposits which are readily
convertible to known amounts of cash and which are subject to insignificant
risk of changes in value and have an original maturity of three months or less
at acquisition. Bank overdrafts are included within current liabilities unless
there is a right of offset with cash balances.
Financial liabilities and equity
Financial liabilities and equity instruments are classified according to the
substance of the contractual arrangements entered into. An equity instrument is
any contract that evidences a residual interest in the assets of the group
after deducting all of its liabilities.
Trade and other payables
Trade payables are not interest bearing and are stated at their carrying value.
Capital Management
Capital is made up of stated capital, premium and retained earnings. The
objective of the Company's capital management is to ensure that it maintains
strong credit ratings and capital ratios. This will ensure that the business is
correctly supported and shareholder value is maximised.
The Company manages its capital structure through adjustments that are
dependent on economic conditions. In order to maintain or adjust the capital
structure, the Company may choose to change or amend dividend payments to
shareholders or issue new share capital to shareholders. There were no changes
to the objectives, policies or processes during the period ended 31 July 2011.
Equity instruments
Equity instruments issued by the group are recorded at the proceeds received,
net of direct issue costs.
Taxation
Current taxes are based on the results shown in the financial statements and
are calculated according to local tax rules, using tax rates enacted or
substantially enacted by the balance sheet date.
Research and development
Expenditure incurred in the development of products or enhancements to existing
products, and their related intellectual property rights, is capitalised as an
intangible asset only when the future economic benefits expected to arise are
deemed probable and the costs can be reliably measured. Development costs not
meeting these criteria are charged as costs within the Comprehensive Statement
of Income.
Foreign currencies
Monetary assets and liabilities denominated in foreign currencies are
translated into sterling at the rate of exchange ruling at the balance sheet
date. Transactions in foreign currencies are recorded at the rate ruling at the
date of the transaction. All differences are taken to the Comprehensive
Statement of Income.
Deferred taxation
Deferred taxation is provided in full in respect of taxation deferred by timing
differences between the treatment of certain items for taxation and accountancy
purposes. The deferred tax balance has not been discounted.
Critical accounting judgements
The preparation of the financial statements under IFRS requires the Company to
make estimates and assumptions that affect the application of policies and
reported amounts. Estimates and judgements are continually evaluated and are
based on historical experience and other factors including expectations of
future events that are believed to be reasonable under the circumstances.
Actual results may differ from these estimates.
Financial risk management
The Group is exposed through its operations to one or more of the following
financial risks that arise from its use of financial instruments. A risk
management programme has been established to protect the Group against the
potential adverse effects of these financial risks.
Credit risk
The Group has Trade receivables at 31 July 2011 £35,397. This balance is
reviewed regularly to minimise any credit risk.
Liquidity risk
Liquidity risk arises from the Group's management of working capital and
finance charges. It is the risk that the Group will encounter difficulty in
meeting its financial obligations as they fall due. The liquidity risk is
managed centrally by the finance function. Budgets are set and are agreed by
the Board. As at 31 July 2011, the Group had cash and cash equivalents
amounting to £55,911.
Interest rate risk
The Group not exposed to interest rate risk.
Foreign currency risk
The Group transacts in US dollars and is exposed to foreign currency risk in
respect of these transactions. Currently the group does not make use of hedging
instruments. The Board monitors the exposure of the Group to foreign currency
risks and will consider on an ongoing basis the implementation of hedging
procedures.
2 LOSS PER SHARE
The calculation of basic loss per share is based on the loss attributable to
ordinary shareholders and the weighted average number of ordinary shares in
issue during the period.
The calculation of diluted loss per share is based on loss per share
attributable to ordinary shareholders and the weighted average number of
ordinary shares that would be in issue, assuming conversion of all dilutive
potential ordinary shares into ordinary shares.
Reconciliations of the loss and weighted average number of shares used in the
calculations are set out below:
Period to Period to
31 July 28 February
2011 2011
£ £
Basic loss per share
Reported loss (484,775) (256,410)
Reported loss per share 0.021 0.013
Weighted average number of ordinary
shares:
Shares issued in respect of the 20,212,492 20,212,492
acquisition of Ceres Media plc
Effect of reverse acquisition of Ceres 3,161,234 -
Media International plc
Weighted average number of shares 23,373,726 20,212,492
Due to the Group's loss for the period, the diluted loss per share is the same
as the basic loss per share.
3 POSTING OF ACCOUNTS
Copies of the Report and Accounts for the period ended 31 July 2011 will be
sent to shareholders on 31 October 2011 and will be available from the
company's website www.ceresmediaplc.com.
4 ANNUAL GENERAL MEETING
Included in the Report and Accounts is a Notice of Annual General Meeting,
which has been convened for Monday 19 December 2011 at 11:00 a.m. at the
offices of Davies Arnold Cooper, 6-8 Bouverie Street, London EC4Y 8DD.
For further information, please contact:
Ceres Media International PLC Tel: 020 3178 5622
Alex Dowdeswell CEO
Nominated Adviser Tel: 020 7148 7900
Cairn Financial Advisers LLP
Jo Turner / Liam Murray
Broker Tel: 020 3002 2070
First Columbus LLP
Chris Crawford / Kelly Gardiner
Financial PR Tel: 020 7556 1063
De Facto Financial
Mike Wort / Anna Dunphy
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