Final Results

RNS Number : 6084L

Catalyst Media Group PLC

06 September 2012

 



Catalyst Media Group Plc

("CMG" or the "Company")

Final results for the year ended 30 June 2012

The Board of Catalyst Media Group ("CMG") is pleased to announce the final results for the Company covering the year ended 30 June 2012. CMG is a 20.54 per cent. shareholder of Satellite Information Services (Holdings) Ltd ("SIS") and the results for the year to 30 June 2012 incorporate its share of the profits of SIS for its year ended 31 March 2012.

Highlights

·      Profit after taxation                     £4.3m (2011: £2.4m)

·      Earnings per share                     15.43p(2011:8.47p)

·      Net assets                                £36.1m (2011:£32.7m)

·      Net assets per share                  128.2p (2011:116p)

·      Net Cash                                   £1.5m

·      Proposed Dividend                     7p per share

·      SIS Revenues                            £240m (2011: £256m)

·      SIS  Profit before taxation           £25.3m(2011: £13.5m)

Michael Rosenberg, Non-Executive Chairman, commented:

"The results for the year ended 30 June 2012 show a considerable increase in profits generated from our holding of 20.54% in SIS. We are pleased that SIS continues to perform well despite the difficult and challenging economic conditions.  We benefited during the year from the receipt of dividends totalling approximately £2.5 million and in addition received a further £1.027 million following the year end. As a result the Group has no debt and is proposing a dividend of 7p per share."

Enquiries:

CMG:

Michael Rosenberg

[phone]     

Non Executive Chairman

Melvin Lawson

[phone]     

Non-Executive Director         

Strand Hanson Limited

[phone]     

James Harris

Angela Hallett

Chairman's statement 

I am pleased to report that for the 12 month period ended 30 June 2012, CMG recorded profit after taxation, including its 20.54% equity share of the profits of Satellite Information Services (Holdings) Ltd (SIS) for its year ended 31 March 2012, of £4.3 million (2011: £2.5 million) with earnings per share from continuing operations of 15.43p (2011: 8.47p). Net assets as at 30 June 2012 were £36.1 million (2011: £32.7 million) with Net assets per share of 128.2p (2011: 116p).  Net cash as at 30 June 2012 was approximately £1.5 million. Following the year end a dividend of £1,027,000 was received from SIS thus further increasing the cash reserves of CMG.

For the year ended 31 March 2012, SIS generated turnover of £240 million (2011: £256 million) and a profit before taxation of £25.3 million (2011: £13.5 million). The reduction in turnover in 2012 is primarily due to the one-off positive impact of the Commonwealth Games on the results for 2011. Net cash inflow from operating activities increased from £46.5 million in 2011 to £51.6m in the year ended 31 March 2012.  A provision of £5.9 million was made in the 2011 accounts to cover possible losses in respect of the previously announced dispute concerning the contract for the Commonwealth Games in 2010. Arbitration proceedings have been initiated to recover the outstanding payment from the Indian broadcaster and hearings are expected to begin in late 2012 or early 2013.

SIS is a world leader in the television broadcasting industry. Through its SISLIVE division, it operates the largest fleet of satellite uplink and outside broadcast units in Europe and is the only company to design, build, operate and support uplink and production vehicles in-house, providing a complete bespoke service. SISLIVE has a unique position in the market as it is able to offer a complete broadcasting solution, from host broadcast facilities through to global distribution, 3D outside broadcast and satellite internet service provision. SISLIVE has satellite uplink contracts with leading broadcasters, including SKY, BBC and ITN. They also operate a large ad hoc satellite uplink fleet with regional truck bases throughout the UK and Europe thus being able to reach any location fast.

There has been an increased level of activity in SIS's joint venture partnership with Peel Group which operates a studio complex containing seven television and two audio studios at MediaCityUK in Salford Quays, Manchester.

The services provided by SIS to the betting industry are supported in the main by fixed term contracts both with the retail owners of betting shops and with the racecourses that enable pictures to be delivered to those shops. SIS now holds long term media rights representing in excess of 50% of all UK horse racing fixtures. This ensures the supply of images and data from the coverage of horseracing fixtures at racecourses including Royal Windsor, Lingfield Park, Chepstow and Fontwell Park until 2016 and 2017.

SIS provides more than 45,000 betting opportunities per year to its customers including exclusive racing from 26 UK and 26 Irish tracks and greyhound racing together with international racing from South Africa, France, Germany and the UAE. Services also include football and the exclusive rights to distribute official English and Scottish FA and FIFA football data. Virtual content includes numbers games, racing, football and others.

The special camera division of SISLIVE produces high quality live action pictures from unique viewpoints, for example, the middle stump in a test match, the racing driver's point of view, the jockey's view in the Grand National and underwater tracking shots at swimming events. In 2011, SISLIVE delivered HD agile cameras and digital RF microwave links for the 34^th Americas Cup. It used 36 newly developed, agile robotic cameras and 7 control units across the 7 live and 3 backup yachts.

During the current year SISLIVE provided facilities for the Queen's Diamond Jubilee with outside broadcast facilities from 10 sites, 9 outside broadcast vehicles, 19 uplink trucks and a total of 251 SISLIVE specialists in outside broadcasts and engineering. It provided sound for the service of thanksgiving at St Paul's Cathedral as well as links for the River Pageant including 30 wireless cameras. It was also deeply involved in providing facilities to the BBC for the UK Olympics and in coverage of the Euro 2012 football competition for both ITV and BBC.

After a competitive tender process, SISLIVE was selected by SkyNews Arabia to supply multiple flyaway systems and on-going technical support for key parts of their contribution services across the Middle East and North Africa.

In July 2012, SISLIVE announced the launch of its brand new teleport facility at MediaCityUK, Salford. It is the largest broadcast teleport ever built in the north of the UK and confirms the company's position as the leading provider of satellite facilities in Europe. In addition, it has entered into a strategic partnership with international media solutions company BT Media and Broadcast ("BT"). This is a five year agreement under which BT will provide SISLIVE with a market leading MPLS-based fibre network to support its rapid growth in broadcast solutions. SISLIVE will become a preferred reseller of the BT Broadcast Fibre and Media network and thus will be able to provide best value and a comprehensive service to its clients.

Shareholders of SIS include certain bookmaker customers, Ladbroke, William Hill, Fred Done of Betfred, the Tote as well as financial investors being CMG and Caledonia Investments Plc.

The results of SIS for the year ended 31 March 2012 are as follows:-

	Year ended 31/3/12	Year ended 31/3/11
	£'000	£'000
Turnover	239,583	255,583
	---------	-----------
Subtotal	239,583	255,583
Operating expenses	211,970	238,698
Operating Profit
Ongoing operations	30,054	16,885
Exceptional Items Share of operating loss of joint venture	(2,441) (53)	- (855)
Profit on disposal of fixed asset	49	10
Net interest payable	(2,281)	(2,585)
Profit on ordinary activities before tax	25,328	13,455
Tax on profit on ordinary activities	(6,723)	(4,342)
Retained profit transferred to reserves	18,605	9,113

The revenues of SIS included £138 million derived from the long established business of providing integrated television and data services to licensed betting offices in the UK, Ireland and overseas. This division contributed approximately £16.4 million to operating profits.

Revenues of £99 million were generated from the business of SISLIVE which provides satellite news gathering and associated transmission services to its customers and also provides outside broadcast television production units including sound support and communication. This division contributed a profit of approximately £5.8 million. 

A further £31 million of revenues came from other services including the production of pictures to the licensed betting offices and services offered to overseas customers. These services contributed approximately £7.9 million to operating profits.  

The SIS group operating profit margin (before exceptional items) increased in 2012 to 12.5% from 6.6% in the previous year primarily due to the prior year provision of £5.9 million relating to the Commonwealth Games, discussed above.

In April 2011, SIS announced plans to undergo one of its biggest developments in its history with the move of its head offices to MediaCityUK, Salford. Plans are underway to move out of the Corsham Street offices and expand the Milton Keynes operation. Some redundancy and relocation costs have been incurred during the year and exceptional costs amounting to £2.4 million relating to this relocation project have been charged to the Profit and Loss account for the year ended 31 March 2012. Further costs will be incurred in the year ending 31 March 2013.

Dividends

SIS has paid dividends totalling £12 million during the year ended 31 March 2012 and since the year end a further £5 million has been paid. Further payments are anticipated subject always to cash requirements for major projects or acquisitions as and when they may occur. The board of CMG intends to distribute the major part of its share of these receipts, being cash surplus to its needs, either through dividends to its shareholders or purchases of its shares. The first such dividend of 7 pence per share will be proposed at the Annual General Meeting of CMG to be held on  28 September 2012 and will be payable to those shareholders on the register of members as at 12 September 2012.

CMG overheads

The overheads of CMG now run at an annualised rate of approximately £170,000 excluding exceptional items and are expected to stay at that level for the foreseeable future.

AGM

Notice of the Annual General Meeting is attached. This will be held at 9.30am on Friday 28 September 2012 at the office of GAM, 20 King St London SW1Y 6QY. Apart from the normal ordinary resolutions there will be a Special Resolution proposed to renew the authority given last year for the company to purchase up to 15% of its share capital in the market. Under this authority, the Company purchased 497,524 shares at 51p per share on 23 December 2011.

Michael Rosenberg OBE

Chairman

CATALYST MEDIA GROUP PLC

Report and financial statements for the year ended 30 June 2012

Consolidated statement of comprehensive income

			12 months ended		15 months ended
			30 June		30 June
			2012		2011
				£		£
	Revenue			25,000		31,250
	Cost of sales			-		(25,000)
	Gross profit			25,000		6,250
	Administrative expenses			(166,682)		(228,152)
	Operating loss			(141,682)		(221,902)
	Financial income			3,069		68
	Financial costs			(27,846)		(48,813)
	Net financial costs			(24,777)		(48,745)
	Share of profit of equity-accounted associate			4,466,218		2,589,272
	Profit before taxation			4,299,759		2,318,625
	Taxation			41,700		64,634
	Profit for the year / period from continuing operations			4,341,459		2,383,259
	Profit for the year / period			4,341,459		2,383,259
	Share of other comprehensive income / (loss) of associate			(46,420)		118,105
	Total comprehensive income for the year / period			4,295,039		2,501,364
	Attributable to equity holders of the Company			4,295,039		2,501,364
	Earnings per share:
	Basic			15.43p		8.47p
	Diluted			15.43p		8.47p
	Earnings per share from continuing operations:
	Basic			15.43p		8.47p
	Diluted			15.43p		8.47p

Consolidated statement of financial position

		30 June 2012 £	30 June 2011 £
Assets
Non-current assets
Intangible assets		-	-
Investment in associate		34,618,166	32,662,725
		34,618,166	32,662,725
Current assets
Trade and other receivables		14,512	26,426
Corporation tax receivable		10,927	10,886
Cash and cash equivalents		1,481,309	27,582
		1,506,748	64,894
Total assets		36,124,914	32,727,619
Equity and liabilities
Capital and reserves attributable to equity holders of the parent
Share capital		2,814,319	2,814,319
Merger reserve		2,402,674	2,402,674
Retained profits/ (deficit)		31,344,612	26,826,782
Total equity		36,085,077	32,043,775
Current liabilities
Interest-bearing loans and borrowings		-	634,635
Trade and other payables		39,837	49,209
		39,837	683,844
Total equity and liabilities		36,124,914	32,727,619

Consolidated statement of cash flows

		30 June 2012 £	30 June 2011 £
Cash flow from operating activities
Profit before taxation including discontinued operations		4,299,759	2,318,625
Adjustments for:
Depreciation, amortisation and impairment		-	-
Share of profit from associate		(4,466,218)	(2,589,272)
Finance income		(3,069)	(68)
Finance expense		27,846	48,813
Corporation taxes recovered		41,659	380,946
Net cash flow from operating activities before changes in working capital		(100,023)	159,044
Decrease in trade and other receivables		2,965	44,735
Decrease in trade and other payables		(9,373)	(13,108)
Net cash flow from operating activities		(106,431)	190,671
Investing activities
Dividend received		2,464,357	-
Interest received		74	68
Net cash flow from investing activities		2,464,431	68
Financing activities
Shares purchased into Treasury		(253,737)	-
Repayment of long-term borrowings		(634,635)	(172,219)
Interest paid		(15,901)	(37,382)
Net cash flow from financing activities		(904,273)	(209,601)
Net increase / (decrease) in cash and cash equivalents in the year / period		1,453,727	(18,862)
Cash and cash equivalents at the beginning of the year / period		27,582	46,444
Cash and cash equivalents at the end of the year / period		1,481,309	27,582

Notes to the financial statements

1.      Investment in associate Year Ended 30 June 2012		Share of net  assets	Fair Value of Intangibles	Total
		Group	Group	Group
		£	£	£
Cost
At 1 July 2011		11,484,684	21,178,041	32,662,725
Share of profit		4,466,218	-	4,466,218
Share of other comprehensive income / (loss)		(46,420)	-	(46,420)
Dividend received		(2,464,357)		(2,464,357)
At 30 June 2011		13,440,125	21,178,041	34,618,166

The Group's interest in the associate, Satellite Information Services (Holdings) Limited (SIS), a company incorporated in Great Britain, is held by Alternateport Limited. Alternateport Limited holds an investment of 20.54% in the equity share capital of SIS and is entitled to appoint a director and alternate director to the SIS board. This right has been exercised since acquisition. Alternateport Limited is a wholly owned subsidiary of Catalyst Media Holdings Limited a wholly owned subsidiary of Catalyst Media Group Plc. The intangible assets recognised upon acquisition of the Group's interest represent customer contracts and goodwill. These are subject to an annual impairment review.

Share of profit of associate*	2012 SIS Total £'000	2012 CMG share £'000	2011 CMG share £'000
Revenue:
UK racing	137,927	28,330	25,539
SIS live services	70,914	14,566	21,638
Other services	30,742	6,314	5,320
Total revenue	239,583	49,210	52,497
Operating profit from ongoing operations (i)	30,699	6,306	4,010
Net interest payable	(2,281)	(468)	(531)
Profit on disposal of fixed asset	49	10	2
Profit before tax	28,467	5,847	3,481
Taxation	(6,723)	(1,381)	(892)
Share of profit after taxation	21,744	4,466	2,589
Net income from associate	21,744	4,466	2,589
Other comprehensive income:
Actuarial gain/(loss)	(305)	(63)	164
Deferred tax	79	16	(46)
	(226)	(46)	118
Share of net assets and liabilities of associate
Net assets (i)	206,557	42,426	34,809
Net liabilities (i)	(140,570)	(28,986)	(23,324)
Net equity	65,987	13,440	11,485

*The period covered by the associate's accounts is 12 months.

(i)         The financial results for SIS are taken from its latest accounts to 31 March 2012, adjusted in order to align the accounting policies of SIS (whose accounts are prepared under UK GAAP) and CMG (whose accounts are prepared under International Financial Reporting Standards). Adjustments have been made in respect of the amortisation of goodwill and the recognition of the fair value of derivatives held by SIS as at the balance sheet date. The net cumulative effect of these adjustments is to increase the value of the investment in associate in the financial statements by £2,043k (2011: £1,398k).

Period Ended 30 June 2011		Share of net  assets	Fair Value of Intangibles	Total
		Group	Group	Group
		£	£	£
Cost
At 1 April 2010		8,777,307	21,178,041	29,955,348
Share of profit		2,589,272	-	2,589,272
Share of other comprehensive income		118,105	-	118,105
At 30 June 2011		11,484,684	21,178,041	32,662,725

2.   Annual Report

The Annual Report for the year ended 30 June 2012 will be posted to shareholders today and is also available from the Company's website www.cmg-plc.com today.

The Annual General Meeting will be held at the offices of GAM, 20 King Street, London SW1Y 6QY, at 9.30am on Friday 28 September 2012.

 

END

 

 

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