Half-yearly Report

Half-yearly Report

Media Corporation PLC

26 May 2010

Media Corporation Plc
("Media Corp" or the "Group")

Interim results for the six months ended 31 March 2010

The Board of Media Corp, a leading advertising network and gaming operator, is pleased to announce its interim results for the period ended 31 March 2010.

Financial Highlights

• Revenues of £10.3 million (2009: £2.0 million) an increase of 415%
• Gross profit of £3.0 million (2009: £0.6 million) an increase of 400%
• Profit after tax of £157,000 (2009: Loss of £898,000) an increase of £1.1 million
• Cash balances of £2.3 million (March 2009: £2.5 million; September 2009: £1.7 million)
• Successful sale of treasury stock raising £0.9 million for the Group

Trading Highlights

• Acquisition of Purple Lounge, a leading online gaming brand
• Gambling.com returned to number 1 in Google’s search rankings
• Strong trading across the Group at the start of the second half

Justin Drummond, CEO of Media Corp, commented:

“Following the board’s strategy to reduce overheads and move back in to online gaming via the acquisition of Purple Lounge, the first six months of the financial year represent a significant turnaround in the fortunes of the Group. Whilst the second quarter is seasonally the weakest quarter for the advertising network business, we have seen strong and profitable growth in the Group’s recently acquired gaming operation.

“The acquisition of Purple Lounge has given us a fast growing, profitable and hugely scalable business which can benefit from the Group’s extensive online marketing expertise. Whilst the main driver for growth has been in internet publishing through Purple Lounge, where revenue increased significantly, revenue in the Group’s advertising network has grown organically by a solid 36%.

“The second half of the financial year has started strongly, with record revenues across the Group in April. It is anticipated that this trend will continue and the Board remains confident of an excellent outcome for the rest of the year.”

Issue of Warrants

The Group has today issued 1,900,000 warrants to subscribe for Ordinary Shares of 1 penny each ("Warrants") at a price of 2.25 pence (being the mid-market price of the Group’s shares on 25 May 2010). These Warrants have been issued to certain Directors and Managers of the company. Chris Gorman OBE and John Palmer, both Directors of the Group, were awarded 1,000,000 and 400,000 warrants.

--ENDS--

Contacts:
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Media Corporation Plc		Tel: [phone]
Justin Drummond - CEO
Nilesh Jagatia – Group Finance Director
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Astaire Securities Plc		Tel: + 44 20 7448 4400
Luke Cairns / Avi Robinson (Nomad)
Katie Shelton (Broker)
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Bishopsgate Communications		Tel: + 44 20 7562 3350
Gemma O'Hara / Siobhra Murphy
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Threadneedle Communications		Tel: [phone]
Graham Herring / Josh Royston
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Consolidated Unaudited Income Statement for the six months ended 31 March 2010
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		Six months endedended		Six months endedended		Year ended
		31 March 20102010		31 March 20092009		30 September 20092009
		(unaudited)		(unaudited)		(audited)
		£'000		£'000		£'000
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Total revenue		10,334		2,002		3,507
Cost of sales		(7,380)		(1,418)		(2,627)
Gross profit		2,954		584		880
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Administrative expenses		(2,798)		(1,496)		(3,588)
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Analysis of administrative expenses:
Distribution costs		(1,512)		(193)		(276)
Other administrative expenses		(1,286)		(1,303)		(2,914)
Exceptional loss		Â		Â		(398)
Â		(2,798)		(1,496)		(3,588)
						Â
Operating profit / (loss)		156		(912)		(2,698)
						Â
Finance income		1		14		39
						Â
Profit / (loss) before income tax		157		(898)		(2,659)
						Â
Income tax expense		-		-		(14)
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Profit / (loss) from continuing activities attributable to equity holders of the Group		157		(898)		(2,645)
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Earnings/(loss) per share attributable to equity holders of the Group
Basic		0.06p		(0.31)p		(0.90)p
Diluted		0.05p		(0.28)p		(0.83)p
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Consolidated unaudited statement of recognised income and expense for the six months ended 31 March 2010
	Â		Â		Â
		Six months endedended		Six months endedended		Year ended
		31 March 20102010		31 March 20092009		30 September 20092009
		(unaudited)		(unaudited)		(audited)
		£'000		£'000		£'000
						Â
Currency translation differences		77		95		841
Total income recognised directly in equity		77		95		841
Profit / (loss) for the year		157		(898)		(2,645)
Total recognised income / (expense) for the period		234		(803)		(1,804)
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Consolidated unaudited balance sheet as at 31 March 2010
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		Six months endedended		Six months endedended		Year ended
		31 March 20102010		31 March 20092009		30 September 20092009
		(unaudited)		(unaudited)		(audited)
		£'000		£'000		£'000
Assets
Non current assets
Property, plant and equipment		342		458		85
Intangibles		4,768		4,566		4,830
Deferred tax asset		-		-		8
		5,110		5,024		4,923
Current assets
Trade and other receivables		1,132		985		675
Cash at bank and in hand		2,302		2,511		1,697
		3,434		3,496		2,372
Total assets		8,544		8,520		7,295
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Liabilities
Current liabilities
Trade and other payables		(3,738)		(1,312)		(1,342)
Current tax liabilities		-		(25)		(18)
		(3,738)		(1,337)		(1,360)
Total liabilities		(3,738)		(1,337)		(1,360)
Total assets less liabilities		4,806		7,183		5,935
Equity
Share capital		4,798		4,773		4,798
Share premium		12,943		12,927		12,943
Other Reserves		1,422		1,422		1,422
Ordinary shares in treasury		(372)		(719)		(719)
Translation reserves		310		(112)		536
Retained Earnings		(14,295)		(11,108)		(13,045)
Total shareholders’ equity		4,806		7,183		5,935
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Consolidated unaudited statement of changes in shareholders’ equity for the six months ended 31 March 2010
	Â		Â		Â		Â		Â		Â
Group		Share capital		Share premium		Currency translation reserve		Other reserves		Retained earnings		Total
		£’000		£’000		£’000		£’000		£’000		£’000
		Â		Â		Â		Â		Â		Â
At 30 September 2008		4,773		12,927		(305)		1,422		(10,924)		7,893
Loss for the year		-		-		-		-		(2,645)		(2,645)
Share based payments		-		-		-		-		27		27
Currency translation differencesdifferences		-		-		841		-		-		841
Purchase of own shares		-		-		-		-		(222)		(222)
Issue of shares		25		16		-		-		-		41
At 30 September 2009		4,798		12,943		536		1,422		(13,764)		5,935
Profit for the year		-		-		-		-		157		157
Reserves on acquired company b/fcompany b/f		-		-		-		-		(1,406)		(1,406)
Currency translation differencesdifferences		-		-		(226)		-		-		(226)
Sale of own shares		-		-		-		-		346		346
At 31 March 2010		4,798		12,943		310		1,422		(14,667)		4,806
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Consolidated unaudited cash flow statements for the six months ended 31 March 2010
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		Six months endedended		Six months endedended		Year ended
		31 March 20102010		31 March 20092009		30 September 20092009
		(unaudited)		(unaudited)		(audited)
		£'000		£'000		£'000
Operating activities
Operating profit / (loss)		156		(912)		(2,698)
Depreciation and amortisation		(179)		(109)		(255)
Increase / (decrease) in receivables		(459)		(232)		78
Increase in payables		1,378		57		107
Net cash (used in)/generated by operating activities		896		(1,196)		(2,258)
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Investing activities
Interest received		1		14		39
Purchase of property, plant and equipment		(214)		(8)		(34)
Purchase of intangibles		(421)		-		(82)
Net cash (used in)/generated by investing activities		(634)		6		(77)
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Financing activities
Purchase / sale of treasury shares		420		(221)		(222)
Net cash used in financing activities		420		(221)		(222)
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Net increase / (decrease) in cash and cash equivalents		682		(1,411)		(2,488)
Cash and cash equivalents at beginning of period		1,697		3,809		3,809
Effects on exchange movements		(77)		113		376
Cash and cash equivalents at end of period		2,302		2,511		1,697

Note: The Group is expecting an additional £453,081.84 in June 2010 from the deferred settlement of the sale of treasury shares.

Notes to the accounts

1. Basis of preparation

These consolidated interim financial statements of the Company and its subsidiaries ("the Group") for the six months ended 31 March 2010 have been prepared using accounting policies consistent with International Financial Reporting Standards (IFRSs). The same accounting policies, presentation and methods of computation are followed in the consolidated set of financial statements as applied in the Group's latest audited financial statements for the year ended 30 September 2009

These consolidated interim financial statements do not constitute Statutory Accounts under the Companies Act 2006, have not been audited, and do not include all of the information required for full annual financial statements. They should be read in conjunction with the Group's consolidated annual financial statements for the year ended 30 September 2009. The auditors' opinion on those Statutory Accounts was unqualified and did not draw attention to any other matters required by the Companies Act 2006. The Statutory Accounts for the year ended 30 September 2009 have been delivered to the Registrar of Companies.

The comparative figures presented are for the six months ended 31 March 2009 and the year ended 30 September 2009

Revenue

Revenue is measured at the fair value of the consideration received or receivable and represents amounts receivable for goods and services provided in the normal course of business, net of discounts, VAT and other sales related taxes. Sales of goods are recognised when goods are delivered and title has passed. Sales of services are recognised when the service has been completed and invoiced to the customer.

Goodwill

The directors undertake an impairment review of goodwill at the end of each annual reporting period.

2. Segmental analyses

The Group's primary segmental information is based on its operating divisions: its operating divisions:	Â	Six months endedended	Â	Six months endedended	Â	Year ended
		31 March 20102010		31 March 20092009		30 September 20092009
		(unaudited)		(unaudited)		(audited)
		£'000		£'000		£'000
Revenue
Advertising Network		1,922		1,418		2,602
Internet Publishing		8,412		584		905
		10,334		2,002		3,507
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Operating profit / (loss)
Advertising Network		203		(228)		(521)
Internet Publishing		(47)		(684)		(2,177)
		156		(912)		(2,698)
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Assets
Advertising Network		937		659		1,072
Internet Publishing		7,607		7861		6223
		8,544		8,520		7,295
Liabilities
Advertising Network		(676)		(652)		(634)
Internet Publishing		(3,062)		(685)		(726)
		(3,738)		(1,337)		(1,360)
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3. Taxation

There is no provision for UK Corporation tax due to tax losses.

Deferred tax is provided in full in respect of taxation deferred by timing differences between the treatment of certain items for taxation and accounting purposes. Recognition of the deferred tax asset is limited to the extent that the company anticipates making sufficient taxable profits in the future to absorb the reversal of the underlying timing differences. The deferred tax balance has not been discounted. The Group has a deferred tax asset of £Nil (2009: £Nil).

4. Earnings / (loss) per share

	Â	Six months endedended	Â	Six months endedended	Â	Year ended
		31 March 20102010		31 March 20092009		30 September 20092009
		(unaudited)		(unaudited)		(audited)
		£’000		£’000		£’000
Profit / (loss) for the purpose of basic and diluted earnings / (loss) per share earnings / (loss) per share		157		(898)		(2,645)
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Numbers
Weighted average number of ordinary shares for the purpose of basic earnings per share purpose of basic earnings per share		278,364,396		291,927,298		293,467,124
Effective of dilutive potential ordinary shares:
Share warrants		25,084,931		27,250,000		25,084,931
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Weighted average number of ordinary shares for the purpose of diluted earnings per share purpose of diluted earnings per share		303,449,327		319,177,298		318,552,055
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Loss per share – basic		0.06p		(0.31)p		(0.90)p
Loss per share – diluted		0.05p		(0.28)p		(0.83)p
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5. Dividends

The Directors do not recommend the payment of a dividend.

6. Copies of interim results

Copies are available at the Group´s web site at www.mediacorpplc.com. Copies may also be obtained from the Group´s registered office: Media Corporation plc, Ground Floor, 77 Queen Victoria Street, London EC4V 4AY.