Unaudited Half Year Results

RNS Number : 5067A

Immedia Group PLC

30 September 2020

 

ISSUED ON BEHALF OF IMMEDIA GROUP PLC

WEDNESDAY, 30 SEPTEMBER 2020

IMMEDIATE RELEASE

The information contained within this announcement is deemed by the Company to constitute inside information stipulated under the Market Abuse Regulation (EU) No. 596/2014.  Upon the publication of this announcement via the Regulatory Information Service, this inside information is now considered to be in the public domain.

IM MEDIA GROUP PLC

("Immedia" or the "Company" or the "Group")

"Audio visual and digital communications solutions for leading Brands"

2020 UNAUDITED HALF - YEAR RESULTS

Immedia (AIM: IME), announces its unaudited Half-Year results for the six months ended 30 June 2020. 

"The difficulties caused by COVID-19 have overshadowed the good things that we created in Q1 2020 in terms of increased customer engagement. With our cost base firmly under control and elements of the business experiencing some recovery, we are confident that whilst revenue will be reduced the 2020 EBITDA outturn will represent an improvement on the very disappointing 2019 EBITDA results. Indeed the H1 EBITDA performance was considerably better the same period in 2019.

As a result of the Placing last month where we raised £1.1m, the Company is now debt free, except for finance leases and a Government "bounce back" loan.  We believe that we are well placed to move ahead with a new strategic direction following a thorough overhaul of processes and structure."

Your business has undergone huge change in 2020 in terms of pace, people, and processes.  We believe the results of an improved business model will be tangible both in the rest of 2020 and into 2021."

Ross Penney

CEO Immedia

2020 Half-Year key points · EBITDA performance of the business significantly better than the corresponding period in the prior year · IME delivered superlative work to Nationwide Building Society (COVID-19 staff channel for homeworkers), JD Sports Fashion plc (social distance messaging in local languages across Europe), Dana Petroleum (Walk 2 Work Campaign video), Fugro (offshore wind animation), North East Scotland Food and Drink (Virtual Awards 2020) and many others · Lockdown resulted in closure of client sites and delays to project work resulting in limited revenue opportunities for IME Key financials Unaudited Half-Year ended  30 June  2020 Unaudited Half-Year ended 30 June  2019 Audited Year-  ended  31 December 2019 Revenue £1,328,069 £1,741,721 £4,020,443 EBITDA* £ (219,403) £ (315,490) £ (699,584) Loss from operating activities £ (321,055) £ (447,004) £ (941,552) Loss before income tax £ (360,867) £ (457,181) £ (991,461) Net fair value (loss)/gain on financial assets £ (3,900) £57,000 £57,000 Total comprehensive loss for the period £ (364,767) £ (396,785) (£1,015,460) Loss per share - basic (pence) (2.63) (3.31) (7.81) Loss per share - diluted (pence) (2.63) (3.31) (7.81) Net cash and cash equivalents £352,733 £44,571 £237,574 *Loss before interest, tax, depreciation, amortisation, and impairment charges Included in the EBITDA loss are exceptional costs of £161,894 relating mainly to employment costs and the remaining costs of an aborted takeover Post period-end highlights · Share Placing and Subscription completed on 15 September 2020.  1.1m raised to be used for working capital and to repay costs of the aborted transaction undertaken in 2019 and H1 2020. · Short - term loan of £ 0.3m repaid following Placing · New business activities secured in 2020 with Headmasters, Fugro, Deep Green, Weir Oil and Gas, Stork and JFD Global; other market opportunities continue to be developed by the team  · Rebranding of the trading entity to avcimmedia, reflecting a stronger brand entity and culture which will bring together the Aberdeen (AVC) and Newbury (Immedia) offices and take advantage of synergies within the business · The restructure and revision of the business model and processes highlighted in last week's preliminary results announcement will enhance productivity and efficiency and deliver greater focus and pace.

Enquiries:
Im media Group plc Ross Penney, CEO www.immediaplc.com		Tel:  [phone]
SPARK Advisory Partners Limited (Nomad)
Mark Brady/Neil Baldwin		Tel:  [phone]
SP Angel Corporate Finance LLP (Stockbroker) Abigail Wayne		Tel:  [phone]
TooleyStreet Communications (IR & Media Relations)
Fiona Tooley		Tel:  [phone]

About Im media Group plc www.immediaplc.com Im media Group is a multi-media content and digital solutions provider to global businesses and organisations investing in internal and/or brand communications which trades as avcimmedia.  Our interactive audio channels deliver original and relevant content, via avcimmedia's Dreamstream-X platform, to a client's workforce and/or customer base.  Each channel is supported with powerful data analytics, which monitor audience activity and provide data to enable avcimmedia to enhance audience engagement.  The Group also creates original video, 3D animation, App, and web content, as well as supplying and installing audio-visual equipment.  Avcimmedia's clients include BP, FIFA, BMW/Mini, JD Sports Fashion plc, O2, Shell, Subway Europe, Nationwide Building Society, and IKEA.

Im media Group plc  

Unaudited Half-Year Results for the six months ended 30 June 2020

INTRODUCTION

Although the EBITDA result for the Half-Year is unsatisfactory, it is significantly better than in the corresponding period in the prior year, especially given the detrimental effects of the COVID-19  pandemic and the significant one-off exceptional costs taken in the period. 

In our announcement on 6 April 2020 we referred to many positive trading developments in Q1 2020, and to the fact that at this early stage of the year we were trading in line with management expectations.  Due to the impact of COVID-19 in Q2 and beyond, we have not had the opportunity to deliver many substantial new opportunities, although recent signs of recovery give us confidence that incremental revenue streams will materialise.

The business used the relative quietness of the lockdown period in Q2 to bring about significant change in the business.  A renewed vision and structure now unite the whole business on a single P&L.  Major changes have also occurred in personnel and processes, resulting in a harmonious, supportive team culture and environment in which colleagues are encouraged to use their own initiative in pursuit of the Company's goals. 

The Group has undertaken a full review in 2020 to refine Group strategy through a single unified brand - avcimmedia - with a simple strapline - " Audio Visual Communication for Brands ".  The Group is working on systematic cross- and upselling to its broad portfolio of blue chip clients, in tandem with a buy and build strategy to bring strategically focused companies into the Group in the fields of content production, App development and data analytics.   We have placed the engagement and retention of the best possible staff at the centre of our revised strategic landscape.   The objective is to maximise benefit to staff members and shareholders alike.

Our people are doing their utmost both operationally and in business development to manage the current precarious COVID-19 situation.  We remain confident that, with a lot of hard work already done to remodel the business, and in an improved environment, we will generate future substitutional and incremental margins that will deliver value to all stakeholders.

FINANCIAL RESULTS

Revenue in the period being reported decreased 24% to £1,328,069 (H1 2019: £1,741,721).  As above the COVID-19 outbreak has been a significant factor in this HY1 result.  In addition, the Group experienced one retail contract (HSBC UK) coming to a natural end in the business cycle after some 15 years.  Steps to manage working capital in the business have been implemented.

EBITDA  

Considering the developments above, EBITDA loss for the period was (£219,403) (H1 2019: (£315,490)); an improvement of £96,087.  Included in the EBITDA loss are exceptional costs of £161,984 relating mainly to employment costs and the remaining costs of an aborted transaction.  Cash management remains a priority, and in the first half cash increased to £352,733 (H1 2019: £44,571).  The Group has a provision for doubtful debts of £94,730 and a £50,000 "bounce back" loan from the Government to assist with trading difficulties brought about by COVID-19. 

INVESTMENTS

As in previous years, our investment in AudioBoom Group plc, the leading spoken word audio platform (AIM: BOOM), showed fluctuations in value during the period.  In accordance with our IFRS accounting regime, a loss on revaluation of investments of £3,900 has been reported in the first half-year (HY1 2019: gain of £57,000).  Cumulatively, the Group remains in surplus on its investment.

OPERATIONS

The weaker than anticipated trading referred to above has resulted in further cost reduction measures; the full effect of these will be realised in the latter part of this year. 

 

PEOPLE

We are a people-centred organisation and our staff are at the forefront of the organisation's culture and values.

The business employs 27 people, and, on behalf of all stakeholders, I would once again like to thank each one of them for their hard work and dedication particularly as we go through one of the toughest years we have experienced.

OUTLOOK

The recent Placing and Subscription has provided a firm working capital base from which to pursue the Company's strategy and new marketing initiatives.

Our first priority will always be to ensure a safe working environment for all of our employees, and, at the same time we have remained in regular communication with our customers to understand their needs through lockdown and over the coming months. Businesses throughout the UK have been affected by COVID-19, market uncertainty and investment delays and there is no doubt that these trends may continue for some time. 

Despite this backdrop however, we have not stood still; we have acted decisively to reshape the business to make it leaner, more efficient, and quicker to respond to market opportunities.  Stakeholders can expect to see numerous marketing activities highlighting the range of Group products and services in the near future.

It is pleasing to report that we are experiencing re-engagement with clients and increased activity in our project-based business.

Finally, there, is great spirit in the business despite the challenging circumstances we find ourselves in.  We remain determined and believe that this spirit will translate into commercial success in the short to medium-term. 

We look forward to updating all stakeholders in a timely fashion as new opportunities come to fruition and existing contracts are extended.

Note:  Market guidance

In view of the continued turbulent market conditions caused by COVID-19, and the Government guidelines in place, the Company remains unable to give guidance on the 2020 outturn other than that provided in this announcement.

Ross Penney

Chief Executive Officer

On behalf of Immedia Group plc

30 September 2020

Immedia Group plc 

Unaudited Half-Year results for the six months ended 30 June 2020

Consolidated statement of profit or loss

		Unaudited Half-Year		Unaudited Half-Year		Audited Full-Year
		June 2020		June 2019		December 2019
Revenue		1,328,069		1,741,721		4,020,443
Cost of sales		(542,165)		(823,876)		(1,976,945)
Gross profit		785,904		917,845		2,043,498
Admin expenses		(945,065)		(1,364,849)		(2,698,790)
Exceptional items		(161,894)				(286,260)
Loss from operations		(321,055)		(447,004)		(941,552)
Finance income		84		114		-
Finance cost		(39,896)		(10,291)		(49,909)
Loss before tax		(360,867)		(457,181)		(991,461)
Tax expense (S/B Tax Income)		-		3,396		(80,999)
Loss for the period		(360,867)		(453,785)		(1,072,460)
Loss per share (pence)
Basic and Diluted		(2.63)		(3.31)		(7.81)

Consolidated statement of profit or loss and other comprehensive income

	Unaudited Half-Year			Unaudited Half-Year		Audited  Full-Year
		June 2020		June 2019		December 2019
Loss for the period		(360,867)		(453,785)		(1,072,460)
Items that will not be reclassified subsequently to profit or loss:
Fair value gain/(loss) on equity investments not held for trading designated as FVTOC		(3,900)		57,000		54,900
Total comprehensive loss for the period		(364,767)		(396,785)		(1,017,560)

Consolidated balance sheet

		Unaudited Half-Year		Unaudited  Half-Year		Audited Full-Year
		June 2020		June 2019		December 2019
Assets
Property, plant, and equipment		192,996		375,563		268,182
Intangible assets		235,402		278,435		253,099
Deferred tax asset		0		84,395		0
Available for sale assets		111,000		117,000		114,900
Total non-current assets		539,398		855,393		636,181
Current assets
Inventories		155,231		206,278		201,462
Trade and other receivables		556,219		904,343		986,318
Prepayments		85,973		116,554		63,141
Cash and cash equivalents		352,733		44,571		237,574
Total current assets		1,150,156		1,271,746		1,488,495
Total assets		1,689,554		2,127,139		2,124,676
Equity
Share capital		1,455,684		1,455,684		1,455,684
Share premium		3,586,541		3,586,541		3,586,541
Merger reserve		2,245,333		2,245,333		2,245,333
Share based payment reserve		4,578		4,578		4,578
Investment valuation reserve		21,000		27,000		24,900
Retained losses		(8,477,072)		(7,497,530)		(8,116,206)
Total equity		(1,163,936)		(178,394)		(799,170)
Liabilities
Deferred tax		0		0		0
Trade and other payables		0		0		0
Provisions		42,500		42,500		42,500
Total non-current liabilities		42,500		42,500		42,500
Borrowings		250,000		69,981		298,250
Finance leases		135,521		192,296		184,394
Trade and other payables		2,317,670		1,851,717		2,253,590
Deferred income		107,799		149,039		145,112
Total current liabilities		2,810,990		2,263,033		2,881,346
Total liabilities		2,853,490		2,305,533		2,923,846
Total equity and liabilities		1,689,554		2,127,139		2,124,676

Consolidated statement of changes in equity

Attributable to equity shareholders of the Company

	Share capital	Share premium account	Merger reserve	Shared-based payment	Investment valuation reserve	Retained losses	Total  equity
	£	£	£	£	£	£	£
Balance at 1 January 2020	1,455,684	3,586,541	2,245,333	4,578	24,900	(8,116,205)	(799,169)
Loss for the year						(360,867)	(360,867)
Other comprehensive income for the year:
Fair value gain on equity investments not held for trading designated as FVTOCI					-  3,900		-  3,900
Total comprehensive loss for the year:	0	0	0	0	(3,900)	(360,867)	(364,767)
Balance at 30 June 2020	1,455,684	3,586,541	2,245,333	4,578	21,000	(8,477,072)	(1,163,936)

	Share capital	Share premium account	Merger reserve	Shared-based payment	Investment valuation reserve	Retained losses	Total  equity
	£	£	£	£	£	£	£
Balance at 1 January 2019	1,455,684	3,586,541	2,245,333	4,578	(30,000)	(7,043,745)	218,391
Loss for the year						(453,785)	(453,785)
Other comprehensive income for the year:
Fair value gain on equity investments not held for trading designated as FVTOCI					57,000		57,000
Total comprehensive loss for the year:	0	0	0	0	57,000	(453,785)	(396,785)
Balance at 30 June 2019	1,455,684	3,586,541	2,245,333	4,578	27,000	(7,497,530)	(178,394)

	Share capital	Share premium account	Merger reserve	Shared-based payment	Investment valuation reserve	Retained losses	Total equity
	£	£	£	£	£	£	£
Balance at 1 January 2019	1,455,684	3,586,541	2,245,333	4,578	(30,000)	(7,043,745)	218,391
							0
Loss for the year						(1,072,460)	(1,072,460)
Other comprehensive income for the year:							0
Fair value gain on equity investments not held for trading designated as FVTOCI					54,900		54,900
							0
Total comprehensive loss for the year:	0	0	0	0	54,900	(1,072,460)	(1,017,560)
Balance at 31 December 2019	1,455,684	3,586,541	2,245,333	4,578	24,900	(8,116,205)	(799,169)

Consolidated statement of cash flows

		Unaudited Half-Year 2020		Unaudited Half-Year 2019		Audited Full -Year 2019
Cash flows from operating activities
Profit/(loss) for the period before income tax		(360,867)		(457,181)		(991,461)
Adjustments for:
Depreciation and amortisation charges		101,652		131,514		241,968
Loss on sale of assets						493
Exceptional gain from negative goodwill
Financial income		(84)		(114)		0
Financial expense		39,896		10,291		49,910
(Increase)/decrease in trade and other receivables and prepayments		409,017		(250,618)		(280,930)
(Increase)/decrease in inventories		46,231		(52,363)		(47,547)
Increase/(decrease) in trade and other payables and deferred income		26,767		367,424		765,370
Increase in provisions		0		0		0
Net cash from operating activities		262,612		(251,047)		(262,197)
Taxation
Taxation		0		0		3,396
Cash flows from investing activities
Proceeds from sale of property, plant, and equipment
Interest received		84		114
Acquisition of property, plant, and equipment		(8,769)		(63,903)		(30,896)
Acquisition of intangible assets
Acquisition of investments
Net cash from investing activities		(8,685)		(63,789)		(30,896)
Cash flows from financing activities
Repayment of bank loan		(50,000)		0		300,000
Repayment of finance leases		(48,872)		0		(92,517)
Interest paid		(39,896)		(10,291)		(49,910)
Amounts repaid under invoice financing facility		0		0		0
Purchase of own shares for EBT		0		0		0
Net cash from financing activities		(138,768)		(10,291)		157,573
Net decrease in cash and cash equivalents		115,159		(325,127)		(132,124)
Cash and cash equivalents at 1 January		237,574		369,698		369,698
Cash and cash equivalents at end of period		352,733		44,571		237,574

Immedia Group plc 

Notes to the Financial Statements

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 December 2019 have been filed with the Registrar of Companies.  The report of the auditors on these statutory accounts was unqualified, did not draw 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 June 2020 and 30 June 2019 is unaudited.  

This announcement was approved by the Board on 29 September 2020.

1. Reporting entity

Immedia Group Plc (the "Company") is a public limited company incorporated and domiciled in England and Wales.  The address of the Company's registered office, and its principal place of business, is 7-9 The Broadway, Newbury, Berkshire RG14 1AS.  The consolidated financial statements of the Company as at and for the year ended 31 December 2019 comprise the Company and its subsidiaries (together referred to as the "Group"). 

The Group is involved in marketing and communication services through the provision of interactive digital channels products and services using music, radio, and screen-based media to provide brand conversation, engaging entertainment and innovative technical solutions.  It also supplies, installs, and maintains the equipment used to deliver these services.

2. Basis of preparation

The interim financial information in this report has been prepared using accounting policies consistent with IFRS as adopted by the European Union.  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 adopted by the European Union and applicable as at 31 December 2019 and 31 December 2020.  The Group has chosen not to adopt IAS 34 "Interim Financial Statements" in preparing the interim financial information.

3. Significant accounting policies

The accounting policies set out in detail in note 3 of the Group's consolidated financial statements to 31 December 2019 have been applied consistently to these unaudited financial statements to 30 June 2020.

No standards have become applicable for accounting periods commencing on or after 1 January 2020.

4. Financial assets

In March 2014, the Group invested £90,000 in the purchase of 6,000,000 shares in AudioBoom Group plc, an AIM-quoted audio social media platform, as part of the Group's strategy to broaden its digital marketing and communications services. 

The Company has taken the irrevocable election to classify this investment as FVTOCI. At 30 June 2020 the fair value of the investment was £111,000 with a current period fair value loss of £3,900 recognised in other comprehensive income (30 June 2019 fair value £117,000 with fair value gain of £57,000 recognised in other comprehensive income; 31 December 2019 fair value £114,900 with fair value gain of £54,900 recognised in other comprehensive income).

As at the date of approval of this report, the investment represents c.0.4% of AudioBoom Group plc's shares in issue and has a fair value of £103,500. 

5. Loss per share
		Unaudited Half-Year		Unaudited Half-Year		Audited Full Year
		2020 Number		2019 Number		2019 Number
Basic
Weighted average number of shares in issue		14,556,844		14,556,844		14,556,844
Less weighted average number of own shares		(832,374)		(832,374)		(832,374)
Weighted average number of shares in issue for basic earnings per share		13,724,470		13,724,470		13,724,470

The basic and diluted earnings per share are calculated using the after tax loss attributable to equity shareholders for the financial period of £360,867 (30 June 2019: loss £453,875; 31 December 2019: loss £1,072,460) divided by the weighted average number of Ordinary shares in issue in each of the relevant periods: 30 June 2020: 13,724,470 shares (30 June and 31 December 2019: 13,724,470 shares).  For the period to 30 June 2020 and the year to 31 December 2019 and period to 30 June 2019 and in accordance with IAS 33, the diluted loss per share is stated as the same amount as basic as there is no dilutive effect.

2019 Annual Report and Financial Statements

The Annual Report for the year ended 31 December 2019 has been posted to shareholders today together with the Notice of Meeting (NOM) and Form of Proxy.

The Annual Report will also be available to view and download on the Company's website at www.immediaplc.com

2020 Annual General Meeting (AGM)

The AGM will be held on 29 October 2020 at 10am.  Based on the most recent Public Health England and Government guidance, public gatherings for annual general meetings will not be permitted on the date the AGM is due to be held, and accordingly shareholders must not attend the AGM in person.  For further guidance please refer to the investor website or the NOM.

Forward Looking Statements

This document contains certain forward-looking statements which reflect the knowledge and information available to the Company during the preparation and up to the publication of this document.  By their very nature, these statements depend upon circumstances and relate to events that may occur in the future thereby involving a degree of uncertainty.  Although the Group believes that the expectations reflected in these statements are reasonable, it can give no assurance that these expectations will prove to have been correct. Given that these statements involve risks and uncertainties, actual results may differ materially from those expressed or implied by these forward-looking statements.

The Group undertakes no obligation to update any forward-looking statements whether because of new information, future events or otherwise.

The Half-Year Report will be available to view and download from the Group's website at www.immediaplc.com.

 

END

 

 

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