Interim Results
26th September 2012
PARALLEL MEDIA GROUP PLC
("PMG" OR THE "GROUP")
INTERIM RESULTS
FOR THE 6 MONTHS ENDED 30 JUNE 2012
Parallel Media Group Plc (AIM:PAA), a leading sports marketing, media and
digital agency, announces its interim results for the six months ended 30th June 2012.
Highlights
* Successfully promoted and delivered the Ballantine's Championship, the
largest golf tournament in South Korea with a record attendance of over
45,000 people
* Promoted first K-Pop concert (Shinhwa) in Singapore
* Raised £500,000 at 35p to create and grow the Singapore based business
* Turnover of £5.48m
* Gross profit of £1.28 million
* Operating profit of £248,000
* Net profit after tax of £88,000
Post Period Highlights:
* Promoted second K-Pop concert (Wonder Girls) in Singapore
* Signed a contract with the International Judo Federation
* Signed a contract to promote the Korean LPGA golf tournament, ADT Caps, to
be held in Singapore on 15th November 2012
Chairman of PMG, David Ciclitira, commented:
"The first six months of this year have been a positive period for Parallel
Media Group plc, as we have continued to expand the existing business in Asia
at the same time as developing new business based around our offices in Seoul
and Singapore. Examples of this are the promotion of two K-Pop concerts and the
innovative move of the final Korean LPGA event, the ADT Caps, from Seoul to
Singapore."
"I am pleased to announce the appointment of Jin Wei Toh and Martin Capstick as
Managing Directors responsible for the Asian business (PMGA) heading up Sales
and Operations in Asia respectively.
"I am very conscious of the support of our directors, staff and above all
shareholders and would like to take this opportunity to thank them all."
Contact Details
For more information please contact:
Parallel Media Group Plc
David Ciclitira +44 (0) 20 7225 2000
Chairman
Northland Capital Partners Limited +44 (0) 20 7796 8800
Edward Hutton, Luke Cairns
Bishopsgate Communications +44 (0)20 7562 3350
Nick Rome/Sam Allen/Matt Low
pmg@bishopsgatecommunications.com
www.parallelmediagroup.com
CHAIRMAN'S STATEMENT
Overview
The first six months of this year has been a positive period for Parallel Media
Group plc.
Asia
We have continued to expand the existing business in Asia at the same time as
developing new business based around our offices in Seoul and Singapore. This
is illustrated by the promotion of two K-Pop concerts in June and September in
Singapore and the innovative move this November, from Seoul to Singapore, of
the final 2012 Korean LPGA tournament, the ADT Caps.
Europe
We have refocused our European operations around Parallel Smart Media, and the
development of a new joint venture in Milan, concentrating on opportunities
brought about by Expo 2015.
In this period under review and subsequently PMG has:
* Successfully promoted and delivered the Ballantine's Championship, the
largest golf tournament in South Korea, with a record attendance of over
45,000 people
* promoted two K-Pop concerts (Shinhwa and Wonder Girls) in Singapore
* Raised £500,000 at 35p to create and grow the Singapore based business
* Signed a representational contract with the International Judo Federation
* Signed a contract to promote the Korean LPGA golf tournament, ADT Caps, to
be held in Singapore on 15th November 2012
Financial Review
The Company's main focus during the first six months of 2012 has been to
develop its new sales infrastructure based in Singapore.
Turnover for the six months to 30 June 2012 was £5.48m.
The operating profit before exceptional items for the six months to June 30
2012 was £248,000, this operating profit is after deducting approximately £
125,000 of one off set up costs for the Singapore operation.
The exceptional item reflects the payment of creditors from 2011 by issuing
shares in the Company.
The Net Asset Value has increased from £376,000 to £1,183,000, reflecting the
raising of additional capital through the issue of 2,892,595 shares.
At the end of April 2012 PMG raised a further £500,000 at 35p per share of
which £300,000 has subsequently been lent to the PSMA Alpha Entertainment (a
joint venture company set up to promote K-Pop in Singapore), and the majority
of the remaining amount has been invested in the start up of the Singapore
operations.
Senior Management Appointments
To capitalise on its expanding business in Asia, PMG today announces the
appointment of Jin Wei Toh and Martin Capstick as Managing Directors
responsible for the PMG's Asian business, heading up Sales and Operations
respectively. It is hoped that these appointments will allow me, as Executive
Chairman, to spend more time on the development of the Group. As part of this
restructure, the company has streamlined its UK operations through the
outsourcing of the financial function. Additionally the company is reviewing
its statutory structure to eliminate underlying minority interests and
potential conflicts of interests.
Going forward
At the same time as making special mention of the Company's Board and Staff
worldwide, I would like to take this opportunity to thank all our stakeholders.
As your Chairman I truly feel positive about the next 18 months.
I remain committed to improving shareholder communication and look forward to
both sharing with you various announcements this forthcoming quarter, and
meeting you at the AGM at 9am on the 29th October at our offices in London.
David Ciclitira
Chairman
26th September 2012
CONSOLIDATED INCOME STATEMENT
FOR THE SIX MONTHS ENDED 30 JUNE 2012
Notes 6 months 6 months 12 months
to to to 31
30 June 30 June December
2012 2011 2011
unaudited unaudited audited
£'000 £'000 £'000
Continuing operations
Revenue 5,475 6,013 6,417
Cost of Sales (4,191) (4,397) (4,420)
Gross Profit 1,284 1,616 1,997
Administrative Expenses (924) (1,154) (1,920)
Foreign Exchange (32) 62 31
Earnings before interest, tax, 328 524 108
depreciation and amortisation
Depreciation and Amortisation of (80) (83) (225)
intangibles
Operating Profit / (Loss) 248 441 (117)
Exceptional items (100) - (101)
Finance cost (34) (45) (111)
Share of post acquisition loss of (26) - (46)
Joint Venture
Profit/ (Loss) on ordinary 88 396 (375)
activities before tax
Taxation - - -
Profit/(Loss) for the period 88 396 (375)
Attributable to:
Non-controlling Interests (110) - -
Equity Holders of the parent 198 396 (375)
88 396 (375)
Earnings per share 4
Basic 0.9p 2.6p (2.2p)
Diluted 0.9p 2.6p (2.2p)
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTHS ENDED 30 JUNE 2012
6 months 6 months 12 months
to to to 31
30 June 30 June December
2012 2011 2011
unaudited unaudited audited
£'000 £'000 £'000
Profit / (Loss) for the year 88 396 (375)
Other comprehensive income
Exchange difference on translation of - 25 29
foreign operations
Tax effect of changes in other
comprehensive income
Total comprehensive income for the 88 421 (346)
year
Total comprehensive income
attributable to:
Equity holders of the parent 198 417 (350)
Non-controlling interest (110) 4 4
88 421 (346)
CONSOLIDATED BALANCE SHEET
AS AT 30 JUNE 2012
Notes 30 June 30 June 31 December
2012 2011 2011
unaudited unaudited audited
£'000 £'000 £'000
Non-current assets
Property, Plant & Equipment 9 3 1
Intangible Assets 1,934 2,070 2,002
Development Costs 850 294 219
Investment in Joint Venture - - 1,319
Investments 12 12 12
Goodwill on consolidation 1,267 - -
Total non-current assets 4,072 2,379 3,553
Current Assets
Trade Receivables 1,312 1,898 1,917
Cash 78 186 22
Total current assets 1,390 2,084 1,939
Current Liabilities:
Financial Liabilities - 6 250 250 250
borrowings
Financial Liabilities - loans 7 - 39 -
Trade & Other payables 3,487 3,602 3,845
Total current liabilities 3,737 3,891 4,095
Net current assets/ (2,347) (1,807) (2,156)
(liabilities)
Non- current liabilities 8 (542) (750) (667)
Financial borrowings
Deferred Tax - - (354)
Total non current liabilities (542) (750) (1,021)
Net Assets 1,183 (178) 376
Equity
Share Capital 9 3,527 3,362 3.463
Share premium 7,259 5,429 6,653
Other reserves 557 557 557
Capital redemption reserve 5,034 5,034 5,034
Foreign translation reserve 13 13 13
Retained earnings (15,012) (14,439) (15,210)
Total Equity 1,378 (44) 510
Minority Interest (195) (134) (134)
Equity attributable to equity 1,183 (178) 376
holders of the parent
CONSOLIDATED CASH FLOW STATEMENT
FOR THE SIX MONTHS ENDED 30 JUNE 2012
30 June 30 June 31 December
2012 2011 2011
unaudited unaudited audited
£'000 £'000 £'000
Cash flows from operating activities
Operating Profit / (Loss) 148 441 (218)
Depreciation - 3 5
Amortisation of intangibles - 68 68 136
Tournament rights
Amortisation of intangibles - 12 12 87
development costs
Decrease in debtors 605 (509) (936)
Increase/(Decrease) in creditors (712) 45 289
Foreign exchange on non-operating - (27) 4
activities
Increase in translation reserve - 29 25
Cash generated from operating 121 62 (608)
activities
Cash flow from investing activities
Investment in joint ventures (406) - -
Net cash used in investing activities (406) - -
Cash flow from financing activities
Repayments of bank facility - - 146
Convertible loans repaid - - (39)
Cash proceeds from issue of new 500 721
shares
Loan repaid (125) - (229)
Interest paid (34) (45) (111)
Net cash used in financing activities 341 (45) 488
Cash and cash equivalents at 22 142 142
beginning of the year
Exchange (loss) / gains on cash and - 27 -
cash equivalents
Net (decrease)/increase in cash and 56 17 (120)
cash equivalents
Cash and cash equivalents at end of 78 186 22
the period
CONSOLIDATED CHANGES IN EQUITY
FOR THE SIX MONTHS ENDED 30 JUNE 2012
Non
Capital con-
Share Share Other redemption Forex Retained Sub trolling
Capital Premium reserves reserve reserve earnings total interest Total
At 1 3,463 6,653 557 5,034 13 (15,210) 510 (134) 376
January
2012
Profit for - - - - - 198 198 (110) 88
the period
Share issue 64 606 - - - - 670 - 670
Arising on - - - - - - - (49) (49)
acquisition
of Parallel
Smart Media
Ltd
At 30 June 3,527 7,259 557 5,034 13 (15,012) 1,378 (195) 1,183
2012
The table below sets out the movements in reserve for the six months ended 30 June 2011
Non
Capital con-
Share Share Other redemption Forex Retained Sub trolling
Capital Premium reserves reserve reserve earnings total interest Total
At 1 3,362 5,429 557 5,034 (12) (14,835) (465) (138) (603)
January
2011
Profit 396 396 396
for the
period
Foreign 25 25 4 25
exchange
At 3,362 5,429 557 5,034 13 (14,439) (44) (134) (178)
30 June
2011
NOTES TO THE FINANCIAL INFORMATION
1. Basis of Preparation
The condensed financial statements have been prepared using accounting policies
consistent with International Financial Reporting Standards.
The condensed consolidated Interim Financial Statements should be read in
conjunction with the annual financial statements for the year ended 31 December
2011, which have been prepared in accordance with International Financial
Reporting Standards. The comparative figures shown for the year ended 31
December 2011 do not constitute statutory accounts as they have been extracted
from the statutory accounts which have been filed with the Registrar of
Companies. These interim results are unaudited and do not constitute statutory
accounts.
2. Significant Accounting Policies
The condensed financial statements have been prepared under the historical cost
convention. The same accounting policies, presentation and method of
computation are followed in these condensed financial statements as were
applied in the preparation of the Group's financial statements for the year
ended 31 December 2011.
3. Segment Information
The group is organised into two main divisions Event Promotion and Consultancy
and Sales. The Event Promotion operates professional golf tournaments in Asia
which are Sanctioned by the European Tour and Ladies European Tour. The
Consultancy and Sales division is based in the London headquarters and works
with major international brands, sports federations and tourist boards on
sports and lifestyle projects, brand development, sales and marketing
opportunities.
Event Promotion Sales & Consolidated
Asia Consultancy
Europe
6 months 6 months 6 months 6 months 6 months 6 months
to to to to to to
30 June 30 June 30 June 30 June 30 June 30 June
2012 2011 2012 2011 2012 2011
£'000 £'000 £'000 £'000 £'000 £'000
Group
Revenue 5,408 5,556 67 420 5,475 6,013
Segment result 1,217 1,159 67 420 1,284 1,616
Unallocated (1,136) (1,175)
corporate overhead
Operating profit 148 441
Finance Costs (34) (45)
Share of loss of (26) -
Joint Venture
Profit for the 88 396
period
Segment Assets 3,383 2,626 - 293 3,383 2,919
Unallocated 2,079 1,544
corporate assets
Consolidated total 5,462 4,463
assets
Segment (1,839) (1,961) - (363) (1,839) (2,324)
liabilities
Unallocated (2,440) (2,317)
corporate
liabilities
Consolidated total (4,279) (4,641)
liabilities
Net assets 1,183 (178)
4. Earnings per Share
The basic earnings per share is calculated by dividing the profit attributable
to equity shareholders by the weighted average number of shares in issue during
the year. In calculating the diluted earnings per share, outstanding share
options, warrants and convertible loans are taken into account where the impact
of these is dilutive.
6 months to 6 months to year ended
30 June 30 June 31 December
2012 2011 2011
(i) Basic
Profit (loss) for the period (£'000) 198 396 (375)
Weighted average number of shares in 21,712,508 15,437,437 17,339,456
issue (No.)
Earning (loss) per share (p) 0.9 p 2.6 p (2.2p)
(ii) Fully diluted
Profit for the period (£'000) 198 396 (375)
Add back interest charged on - 2 30
convertible loans (£'000)
Revised Profit for the period (£'000) 198 398 (345)
Weighted average number of shares in 21,712,508 15,437,437 17,339,456
issue (No.)
Ordinary shares issuable under - - -
convertible loan agreements *
21,712,508 15,437,437 17,339,456
Diluted Earnings per share (p) 0.9 p 2.6p (2.2p)*
* Ordinary shares issuable under outstanding convertible loan agreements, share
options and warrants are anti-dilutive.
5. Dividends
No dividend was recommended or paid for the period under review
6. Acquisition Of Subsidiary
On 1st January 2012 the group completed the acquisition of Parallel Smart Media
Limited with the purchase of a further 25% of the share capital, taking its
holding to 75%. The investment has not been valued for the purpose of these
interim accounts but will be for the full year audited financial statements.
7. Financial Liabilities - Borrowings
30 June 31
2012 December
2011
£'000 £'000
Bank borrowings 250 250
The bank facility represents amounts due to Lloyds Bank Plc in less than one
year. The total amounts outstanding to Lloyds Bank as at 30 June 2012 and 31
December 2011 are £792k and £917k respectively repayable in 48 consecutive
monthly instalments. See note 8 for details.
8. Non-Current Liabilities - Borrowings
30 June 31 Dec
2012 2011
£'000 £'000
Bank loan > 1 year 542 667
542 667
The bank loan represents amounts due to Lloyds Bank in more than one year.
Lloyds Bank has provided a loan totalling £1 million. The loan is repayable in
48 consecutive monthly instalments from August 2011 (an effective 5 year term
with a one year repayment holiday). The loan carries interest payable at 3%
over base and may be repaid early at the discretion of the company. The loan is
secured by personal guarantees provided by the David Ciclitira concert party.
9. Issued Share Capital
Issued share capital as at 30th June 2012 is comprised as follows:
* 22,912,346 ordinary shares of 2.2 pence being £0.504 million;
* 199,831,545 deferred ordinary shares of 0.5p each being £0.999 million*
* 103,260 deferred B shares of £19.60 being £2.024 million*
* The deferred ordinary shares do not entitle their holders to receive dividend
or other distribution nor do they entitle their holders to receive notice,
attend speak or vote at any General Meeting of the Company. The rights of
deferred share holders are set out in full in the financial statements as at 31
December 2011 on page 33.
Ordinary shares: during the period ordinary shares were issued as follows:
2012
(number)
Ordinary shares of 2.2p each issued during the period
26 April 2012 at 35p per share 1,430,000
3 February 2012 at between 24p and 35p per share 1,462,595
Total shares of 2.2p each issued during the period 2,892,595
26 April 2012- Being £466,075 equivalent settlement of
amounts owed to creditors
3 February 2012- Being SGD1 million new share issue for
cash
10. Related Parties
Luna Trading Limited and its subsidiary, Parallel Contemporary Arts Limited, is
a company under the control of David Ciclitira, and provides consultancy
services, loans and guarantees to Parallel Media Group Plc as follows:
Period ended Year ended
30 June 31 December
2012 2011
£'000 £'000
Opening balance 157 114
Loan guarantee interest paid 25 50
Loan fee 20
Payments made to Luna (58) (146)
Expenses claimed by Luna 54 139
Total loan amounts outstanding to Luna and PCA 198 157
at period end
Luna Trading is the Company through which PMG contract with D Ciclitira for
consulting and business services. During the period, Luna Trading charged PMG
for consultancy fees of £110k and remote office costs of £31.5k.
In 2010, Luna Trading Limited, David and Serenella Ciclitira agreed to provide
personal guarantees of £1 million to Lloyds Bank to support long term PMG
loans. As consideration for providing the guarantees, Luna trading charges 5%
per annum of the guarantee amount for the period of the guarantee. In addition
David Cicilitira has been granted a fixed and floating charge over the
Company's assets for the period of the guarantee and has been granted an option
to acquire at fair value, Parallel Media (Championships) Limited (a wholly
owned subsidiary of PMG which holds the rights to the Company's major sporting
events).
During the year PMG incurred costs for the staging and management of art
projects and PCA loaned money to PMG. The outstanding balance owed by PMG to
PCA at the 30th June was £56,401 due to PCA
11. Other
Copies of unaudited interim results have not been sent to shareholders, however
copies are available at www.parallelmediagroup.com or on request from the
Company Secretary at the Company's Registered Office, 10 Peterborough Mews,
Fulham, London, SW6 5EG.
The Company's AGM will be held at 9am at 10 Peterborough Mews, Fulham, London,
SW6 5EG on 29th October 2012. Notice of the AGM will be sent to shareholders by
Friday 28th September 2012.
12. Approval of Interim Financial Statements
The interim financial statements were approved by the board of directors on
26th September 2012.
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