MediaZest Plc
Unaudited results for the six months ended 30 September 2013
CHAIRMAN’S STATEMENT
Introduction
Results for the six months ended 30 September 2013 for MediaZest Plc (“MediaZest”, the “Company” and, together
with its wholly owned subsidiary company Touch Vision Ltd, the “Group”).
Fundraising
On 13 December, the Company announced a conditional placing of 247,142,800 shares at 0.35p per share to raise
£865,000 before expenses, and a proposed issue of 47,479,714 new shares through the conversion of loan interest
amounting to £166,179 at a price of 0.35p per share. The shares are expected to be admitted to AIM on 2 January
2014 subject to the passing of the necessary resolutions at a General Meeting to be held on 31 December 2013.
Previous to this, on 8 July 2013 the Company completed a placing of 143,200,000 shares at 0.25p per share. The
gross proceeds included conversion of £50,000 of loan interest at the placing price. Net cash proceeds were £289,000
(of which £200,000 was used to pay down debt).
Financial Review
Revenue for the period was £1,572,000 (2012: £964,000) and the Group made a loss for the period after taxation of
£183,000 (2012: £239,000), interest of £77,000 (2012: £55,000), administrative expenses before depreciation of
£674,000 (2012: £625,000) and depreciation of £18,000 (2012: £20,000).
Gross profit was £576,000 (2012: £461,000). The basic and fully diluted loss per share was 0.033 pence (2012: 0.073
pence). EBITDA was a loss of £98,000 (2012: £164,000).
Operational Review
The results for the period reflect a significant improvement in revenue compared to the corresponding period last
year. This follows a large contract win announced at the beginning of the period with a multinational client, a
constituent of the Consumer Staple sector of the S&P 500 index. Total revenue from the project, which is contracted
through one of the world’s biggest advertising groups, is expected to be approximately £1.1million in the period to
summer 2014. Contract delivery has begun with great success, and the Group has already been paid £850,000 of this
revenue, the majority of which falls within the period ended 30 September 2013. The Group is currently pitching for
additional work relating to this project.
Top line revenue for the period increased to £1,572,000 (2012: £964,000) representing growth of 63%. This growth
was achieved through the large contract win detailed above, in addition to further work with existing customers such
as Samsung, O2, Kuoni and JD Sports and new projects from growth areas such as the corporate market.
Gross profit margin as a percentage of revenue was 37% (2012: 48%) mainly reflecting a number of low margin
equipment supply only contracts with clients in the education sector. In addition, the reduced level of service and
maintenance work provided for HMV following its administration in January 2013 had an impact. Prospects for
ongoing project work in the retail, event/brand experience and corporate markets that the Group is targeting for
future growth continue to be strong.
As previously noted, the Board has pursued a policy this year of increasing its investment in the sales team and, in
particular, the development of new business in the corporate sector. The Board was particularly pleased, therefore, to
announce its first major win in this sector for several years, a project delivered in the period for a City of London
based private equity company. Development in this sector has continued and, on 7 November 2013, the Group was
able to announce a second major engagement in respect of a large videowall project, again in the City of London,
due for completion late December 2013.
The Board was also pleased to announce the opening of its new London showroom, which is expected to assist in
driving revenues by giving the Group a means to demonstrate its unique technology offering.
Whilst the impact of increased revenues has led to improved gross profit, investing in improving sales and marketing
resource in order to generate increased future returns has naturally had an impact on the EBITDA and tempered the
improvement in results. However, financial performance for the first half of the financial year remains much
improved on corresponding periods in recent years.
MediaZest Plc
Operational Review (continued)
Although interest and finance costs remained high in the half year, improvement in the Company’s balance sheet and
reduced levels of debt made possible by a conditional fundraising, as announced on 13 December 2013 and as
detailed above, will enable the Group to significantly reduce these costs going forward.
Outlook
The Group has made good progress in the last 12 months, and this has enabled it to undertake a conditional placing
to institutional and other investors to raise £865,000 (before expenses). This placing will allow MediaZest to
capitalise upon the opportunities before it, both in driving additional business and developing new products for
which the Board believes there is a substantial market.
The Company will also de-gear its balance sheet as a consequence of this proposed placing. Furthermore, the Group
will have improved its working capital position and its ability to develop additional products and enable it to
continue to invest in the sales and marketing process. The calendar year is ending on a high note and the Group can
look forward to further progress in 2014.
Lance O’Neill
Chairman
20 December 2013
MediaZest Plc
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE SIX MONTHS ENDED
30 SEPTEMBER 2013
Unaudited
Six months
30-Sep-13
£'000
Unaudited
Six months
30-Sep-12
£'000
Audited
12 months
31-Mar-13
£'000
1,572
(996)
964
(503)
1,850
(941)
576
461
909
(674)
(625)
(1,275)
EBITDA
(98)
(164)
(366)
Administrative expenses – depreciation
(18)
(20)
(47)
(116)
(184)
(413)
(77)
(55)
(138)
(193)
(239)
(551)
10
-
-
(183)
(239)
(551)
(0.033p)
(0.033p)
(0.073p)
(0.073p)
(0.15p)
(0.15p)
Notes
Continuing Operations
Revenue
Cost of sales
Gross profit
Administrative expenses
Operating Loss
Interest
Loss before taxation
Taxation credit
Loss for the period and total comprehensive loss for the
period attributable to the owner of the parent
Loss per ordinary 0.1p share
Basic
Diluted
2
2
MediaZest Plc
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 SEPTEMBER 2013
Non-current assets
Goodwill
Property, plant and equipment
Total non-current assets
Unaudited
As at 30-Sep-13
Unaudited
As at 30-Sep-12
Audited
As at 31-Mar-13
£'000
£'000
£'000
2,772
2,772
2,772
51
83
63
2,823
2,855
2,835
Current assets
Inventories
142
95
123
Trade and other receivables
440
406
515
-
33
1
582
534
639
(1,244)
(1,093)
(1,155)
(393)
(546)
(707)
Total current liabilities
(1,637)
(1,639)
(1,862)
Net current liabilities
(1,055)
(1,105)
(1,223)
Net assets
1,768
1,750
1,612
Equity
Share Capital
2,879
2,587
2,736
Share premium account
4,225
4,004
4,029
Cash and cash equivalents
Total current assets
Current liabilities
Trade and other payables
Financial liabilities
Other reserves
Retained earnings
Total equity
7
7
7
(5,343)
(4,848)
(5,160)
1,768
1,750
1,612
MediaZest Plc
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHS ENDED
30 SEPTEMBER 2013
Share
Capital
£'000
Share
Premium
£'000
Share
Options
Reserves
£'000
Retained
Earnings
£'000
Total
Equity
£'000
2,587
4,004
7
(4,609)
1,989
Loss for the period
-
-
-
(239)
(239)
Total comprehensive income for the period
-
-
-
(239)
(239)
2,587
4,004
7
(4,848)
1,750
Loss for the period
-
-
-
(312)
(312)
Total comprehensive income for the period
-
-
-
(312)
(312)
149
-
30
(5)
-
-
179
(5)
2,736
4,029
7
(5,160)
1,612
Loss for the period
-
-
-
(183)
(183)
Total comprehensive income for the period
-
-
-
(183)
(183)
143
215
-
-
358
-
(19)
-
-
(19)
2,879
4,225
7
(5,343)
1,768
Balance at 31 March 2012
Balance at 30 September 2012
Issue of share capital
Share issue costs
Balance at 31 March 2013
Issue of share capital
Share issue costs
Balance at 30 September 2013
MediaZest Plc
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2013
Unaudited
Unaudited
Audited
Six months
Six months
12 months
Note
30-Sep-13
30-Sep-12
31-Mar-13
£'000
£'000
£'000
Net cash generated from/ (used in) operating activities
3
Cash flows used in investing activities
Purchase of plant and machinery
Disposal of plant and machinery
Net cash used in investing activities
Cash flow from financing activities
Repayment of borrowings
Shareholder loans
Other loan repayments
Shareholder loan repayments
Interest paid
Proceeds of issue of shares
Share issue costs
Net cash generated from/(used in) financing activities
Net decrease in cash and cash equivalents
Cash and cash equivalents at beginning of period/year
Cash and cash equivalents at end of period/year
4
12
(82)
(385)
(6)
(6)
(6)
(6)
(16)
3
(13)
(8)
(77)
(200)
(77)
308
(19)
(73)
(8)
(55)
(63)
(17)
77
(39)
179
(5)
195
(67)
(151)
(203)
(199)
4
4
(266)
(147)
(199)
MediaZest Plc
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 2014.
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 the light of the ongoing economic difficulties in the UK and global
economy, previous experience of the markets in which the Group 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 Group
will generate sufficient cash resources to meet its liabilities as they fall due over the next 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 2013 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 2013 and 30 September 2012 is not audited.
2.
Loss per share
Basic loss per share is calculated by dividing the loss attributed to ordinary shareholders of £183,000 (2012:
£239,000) by the weighted average number of shares during the period of 548,759,406 (2012: 327,625,327). 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”.
MediaZest Plc
NOTES TO THE FINANCIAL INFORMATION (Continued)
3.
CASH USED IN OPERATIONS
Operating loss
Depreciation of tangible assets
(Increase)/decrease in inventories
Increase in payables
Decrease/(increase) in receivables
Net cash inflow/(outflow) from operating activities
Unaudited
Six months
30-Sep-13
£'000
(116)
18
(19)
44
85
12
Unaudited
Six months
30-Sep-12
£'000
(184)
20
11
207
(136)
(82)
Audited
12 months
31-Mar-13
£'000
(413)
47
(17)
243
(245)
(385)
Unaudited
Six months
30-Sep-13
£'000
(63)
(203)
(266)
Unaudited
Six months
30-Sep-12
£'000
33
(180)
(147)
Audited
12 months
31-Mar-13
£'000
1
(92)
(108)
(199)
4. CASH AND CASH EQUIVALENTS
Cash held at bank
Bank overdraft
Invoice discounting facility
5.
Subsequent Events
On 13 December, the Company announced a conditional placing of 247,142,800 shares at 0.35p per share to raise
£865,000 before expenses, and a proposed issue of 47,479,714 new shares through the conversion of loan interest
amounting to £166,179 at a price of 0.35p per share. The shares are expected to be admitted to AIM on 2 January
2014 subject to the passing of the necessary resolutions at a General Meeting to be held on 31 December 2013.
6.
Distribution of the Half-yearly Report
Copies of the Half-yearly Report will be available to the public from the Company’s website, www.mediazest.com,
and from the Company Secretary at the Company's registered address at 27/28 Eastcastle Street, London, W1W
8DH.
MediaZest Plc
Tel: 020 7724 5680
Geoff Robertson
Chief Executive Officer
Nominated Adviser
Northland Capital Partners Limited
Tel: 0207 796 8800
Gavin Burnell/Edward Hutton
Broker
Hybridan LLP
0207 947 4350
Claire Noyce/William Lynne