Half Yearly Report

RNS Number : 6890A

Parallel Media Group PLC

30 September 2015

 

30 September 2015

PARALLEL MEDIA GROUP PLC

("PMG" OR THE "GROUP")

HALF-YEARLY RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2015

Parallel Media Group Plc (AIM:PAA), a leading event marketing and media agency, announces its half-yearly results for the period ended 30 June 2015.

Highlights

·      Through its associated music business, it has:

o  Agreed high profile sponsorship for a US chart topping indie band's concerts in HK and Malaysia;

o  Secured underwriting for an annual dance music event in Tokyo in 2016 and beyond; and

o  Launched a collaboration with Google/YouTube to create CentreStage in Asia, the first edition of which took place at a leading American rock band's concert in Indonesia on 11 September 2015.

·      Reduced overheads by £0.4m against the same period as last year.

Chairman of PMG, David Ciclitira, commented: "

We are beginning to see real traction in our music business which after all the hard groundwork should really take off in 2016.  Whilst the main focus of the company has shifted to music, we are still in discussion with various sponsors for the Championship to be staged in 2016.  On a stand-alone basis, the music business is now profitable and will make a small contribution to PMG's overheads this year.

I would like to make a special mention of the Company's Board and Staff worldwide for their considerable efforts and I would, at the same time, like to thank all our stakeholders for their support."

Contact Details

For more information please contact:

Parallel Media Group Plc David Ciclitira www.parallelmediagroup.com	[phone]
Sanlam Securities UK Limited Virginia Bull - Corporate Finance www.sanlamsecuritiesuk.com	[phone]

CHAIRMAN'S STATEMENT

Music

The hard work of late 2014 and the first six months of 2015 is starting to reap rewards, with various agreements concluded and others in the pipeline.  Projects successfully agreed to 30 June 2015 include the negotiation and activation of an international insurance company's sponsorship of a US chart topping indie band's concerts in HK and Malaysia and securing underwriting for an annual dance music event in Tokyo in 2016 and beyond.  Additionally, working with YouTube CentreStage in Asia, the first edition of which took place at a leading American rock band's concert in Indonesia on 11 September 2015.  CentreStage gives YouTube artists the opportunity to be opening acts for established artists at Live Nation promoted concerts across Asia.

Golf Events

PMG is in active discussion with various potential title sponsors of the Championship, which is planned to take place in 2016 after a year of absence from the European Tour. PMG looks forward to once again promoting a first class event on the European Tour.

Financial Review

The results of the cost cutting exercise is starting to show with the first six months of 2015 resulting in a loss of £0.18m against a loss of £0.44m in the same period for last year. This exercise resulted in substantial savings in administration expenses of £0.40m against the same period.

Revenue fell in the first 6 months of June as the group continues to focus on the potential of the music operation and also due to the non staging of two golf events (Causeway Trophy and The Championship) from £0.57m at June 2014 to £0.08m in June 2015. This resulted in the gross profit of the Group being £0.10 to June 2015 against £0.23m to June 2014.

The loss in the first six months therefore continued to increase the net liabilities on the statement of financial position to £1.83m.

As in previous years, I have supported the working capital requirements of the Company.  The balance of the loans due to me at the period end was £0.69m.  In addition, the bank facility at period end totalled £0.35m and is secured by a personal guarantee provided by me at a monthly cost of £1,674 to the Company.

The loans have been made in the name of David Ciclitira on a short term basis and as yet there are no formal terms of these loans.  The independent directors, being Tim Sturm and Ranjit Murugason consider that, having consulted with the Company's Nominated Adviser, the provision of the loans are fair and reasonable in so far as the Company's shareholders are concerned.

Post Balance Sheet Events

There has not been any matter or circumstance occurring subsequent to the end of the financial period that has significantly affected, or may significantly affect, the operations of the company, the results of those operations, or the state of affairs of the company in future financial years. 

Going forward

I remain positive and would like to use this opportunity to thank our board and hardworking staff, without whose support our undoubted potential would not be possible.

David Ciclitira                        

Chairman

Date: 30 September 2015

Consolidated income statement for half year to 30 June 2015

		30 June 2015 unaudited	30 June 2014 unaudited	31 December 2014 audited
	Note	£'000	£'000	£'000
Continuing operations
Revenue		107	572	692
Cost of sales		(4)	(344)	(442)
Gross profit		103	228	250
Other administrative expenses		(198)	(554)	(984)
Foreign exchange		30	7	(106)
Depreciation and amortisation of non financial assets		(69)	(93)	(187)
Total admin expenses		(237)	(640)	(1,277)
Operating (loss) before exceptional items		(134)	(412)	(1,027)
Exceptional items		-	-	(3,648)
Operating loss after exceptional items		(134)	(412)	(4,675)
Finance costs		(19)	(31)	(65)
Share of post acquisition loss of Joint Venture		-	-	129
Loss before tax		(153)	(443)	(4,611)
Tax expense		-	-	-
Loss for the period		(153)	(443)	(4,611)
Attributable to:
Non-controlling interests		-	-	-
Equity holders of the parent		(183)	(443)	(4,611)
Loss for the financial period		(183)	(443)	(4,611)
Earnings Profit/(loss) per share
-basic	4	(5.1p)	(14.7p)	(153.2p)
-diluted	4	(5.1p)	(14.7p)	(153.2p)

The accompanying accounting policies and notes form an integral part of the financial statements.

Statement of comprehensive income for half year to 30 June 2015

		Group
	30 June 2015 unaudited	30 June 2014 unaudited	31 December 2014 audited
	£'000	£'000	£'000
(Loss)/profit for the period	(153)	(443)	(4,611)
Exchange difference on translation of foreign operations	(31)	-	(69)
Total comprehensive (expense) / income for the period	(184)	(443)	(4,680)
Total comprehensive (expense) / income attributable to:
Equity holders of the parent	(184)	(443)	(4,680)
Non - controlling interest	-	-	-
	(184)	(443)	(4,680)

Statement of financial position for the half year to 30 June 2015

	30 June  2015 (unaudited)	30 June  2014 (unaudited)	31 December 2014  (audited)
	£'000	£'000	£'000
Non current assets
Property, plant and equipment	4	9	6
Intangible assets - Tournament rights	1,526	1,662	1,594
Intangible assets - Development costs	-	2,901	-
Goodwill	-	200	-
Investments	-	56	-
Total non current assets	1,530	4,828	1,600
Current assets
Inventory	-	8	-
Trade and other receivables	22	1,702	72
Cash and cash equivalents	(7)	9	3
Total current assets	15	1,719	75
Current liabilities
Financial liabilities - Borrowings	85	162	85
Trade and other payables	3,032	2,902	2,927
Total current liabilities	3,117	3,064	3,012
Net current liabilities	(3,102)	(1,345)	(2,937)
Non current liabilities
Financial liabilities - Borrowings	266	291	317
Deferred tax	-	708	-
	266	999	317
Net (liabilities)/assets	(1,838)	2,484	(1,654)

Statement of financial position for the half year to 30 June 2015

Equity
Share capital	4,612	4,612	4,612
Share premium	8,741	8,741	8,741
Other reserves	503	557	503
Capital redemption reserve	5,034	5,034	5,034
Foreign exchange reserve	(147)	13	(116)
Retained earnings	(20,734)	(16,473)	(20,581)
Equity attributable to equity holders of the parent	(1,991)	2,484	(1,807)
Non-controlling interests	153	-	153
	(1,838)	2,484	(1,654)

Statement of cashflows for the half year to 30 June 2015

	30 June 2015 (unaudited)	30 June 2014 (unaudited)	31 December 2014 (audited)
	£'000	£'000	£'000
Cash flows from operating activity
Operating (loss)	(153)	(412)	(4,675)
(Decrease)/increase in translation reserve	(31)	-	(69)
Depreciation	2	3	6
Amortisation of intangibles-Tournament rights	68	68	136
Amortisation of intangibles-Development costs	-	22	45
Loss on disposal of investment	-	-	2
(Increase)/decrease  in inventory	-	-	8
Decrease/(increase) in receivables	50	627	2,386
(Decrease)/increase in payables	105	(195)	(170)
Cash generated from/(used in) operations	41	113	39
Cash flow from investing activities
Acquisition of equipment	-	(9)	(9)
Net cash (used in) investing activities	-	(9)	(9)
Cash flow from financing activities
Cash proceeds from issue of new shares	-	-	153
Loans repaid	(42)	(88)	(139)
Interest paid	(9)	(31)	(65)
Net cash (used in)/generated from financing activities	(51)	(119)	(51)
Cash and cash equivalents at beginning of the period	3	32	24
Net (decrease)/increase in cash and cash equivalents	(10)	(15)	(21)
Cash and cash equivalents at end of the period	(7)	17	3

Consolidated statement of changes in equity for half year to 30 June 2015

	Ordinary Share Capital	Share Premium	Other Reserves	Capital Redemption	Foreign Exchange Reserve	Retained Earnings	Subtotal	Non controlling Interests	Total
At 31 December 2014	4,612	8,741	503	5,034	(116)	(20,581)	(1,807)	153	(1,654)
Loss for the half year	-	-	-	-	-	(153)	(153)	-	(153)
Foreign Exchange	-	-	-	-	(31)	-	(31)	-	(31)
Total comprehensive income					(31)	(153)	(184)	-	(184)
At 30 June 2015	4,612	8,741	503	5,034	(147)	(20,734)	(1,991)	153	(1,838)

Consolidated statement of changes in equity for the year ended 31 December 2014

	Ordinary Share Capital	Share Premium	Other Reserves	Capital Redemption	Foreign Exchange Reserve	Retained Earnings	Subtotal	Non controlling Interests	Total
At 31 December 2013	4,612	8,741	503	5,034	13	(16,030)	2,873	-	2,873
Loss for the year	-	-	-	-	-	(4,611)	(4,611)	-	(4,611)
Foreign exchange	-	-	-	-	(129)	60	(69)	-	(69)
Total comprehensive income					(129)	(4,551)	(4,680)	-	(4,680)
Issued share capital					-	-	-	153	153
At 31 December 2014	4,612	8,741	503	5,034	(116)	(20,581)	(1,807)	153	(1,654)

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 Half-yearly Financial Statements should be read in conjunction with the annual financial statements for the year ended 31 December 2014, which have been prepared in accordance with International Financial Reporting Standards. These half-yearly 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 2014.

3.     Segment Information - Changes in Operating Segments

The group now operates under three segments, Sports, Entertainment and Media. The previous segments which are no longer in use were Event Promotion, Sales & Consultancy and Smart Media.

Operating Segments	Sports		Entertainment		Media		Consolidated
	£'000		£'000		£'000		£'000
	June 2015	June 2014	June 2015	June 2014	June 2015	June 2014	June 2015	June 2014
Revenue	107	274	-	29	-	-	107	303
Joint ventures	-	-	-	-	-	-	-	-
Segment result	104	126	-	12	-	-	104	138
Unallocated corporate expenses							(237)	(550)
Operating profit							(134)	(412)
Finance costs							(19)	(31)
(Loss) for the year							(153)	(443)

4.     Earnings per Share

The basic earnings per share are 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.

	Six months to		Six months to		Year ended
	30 June		30 June		31 December
	2015		2014		2014
(i) Basic
(Loss) for the period (£'000)	(153)		(443)		(4,611)
Weighted average number of shares in issue (No.)	3,009,223		3,009,223		3,009,223
Earning/(loss) per share  (p)	(5.1p)		(14.7p)		(153.2p)
(ii) Fully diluted
(Loss) for the period (£'000)	(153)		(443)		(4,611)
Revised (loss) for the period  (£'000)	(153)		(443)		(4,611)
Weighted average number of shares in issue (No.)	3,009,223		3,009,223		3,009,223
Ordinary shares issuable under convertible loan agreements *	-		-		-
	3,009,223		3,009,223		3.009,223
Diluted Earnings per share (p)*	(5.1p)		(14.7p)		(153.2p)

* The fully diluted loss per share is the same as the basic loss per share as the effects of potential shares are anti-dilutive.

5.     Dividends - No dividend was recommended or paid for the period under review

6.     Financial Liabilities - Borrowings

	30 June 2015		30 June 2014
	£'000		£'000
Bank facility	85		162
	85		162

The bank facility represents amounts due to Lloyds Bank Plc in less than one year. The total amount outstanding to Lloyds Bank as at 30 June 2015 was £0.35m.

7.     Non-Current Liabilities  - Borrowings

	30 June 2015		30 June 2014
	£'000		£'000
Bank facility > 1 year	266		291
	266		291

The bank facility represents amounts due to Lloyds Bank in more than one year. The total amount owed to Lloyds Bank was £0.35m (of which £0.09m is included in current liabilities and £0.19m in non current liabilities). The loan carries interest payable at 4% over base rate. The loan may be repaid early at the discretion of the Group. The loan is secured by personal guarantee provided by David Ciclitira.

8.     Issued Share Capital

Issued share capital as at 30 June 2015 is comprised as follows:

·      3,009,223 ordinary shares of 52.8 pence being £1.589 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 for the year ended 31 December 2014.

9.     Related Parties 

Luna Trading Limited and its subsidiary, Parallel Contemporary Arts Limited (PCA), is a company under the control of David Ciclitira, which provides consultancy services, loans and guarantees to Parallel Media Group Plc.

	Period ended 30 June 2015	Period ended 30 December 2014 (audited)
	£'000	£'000
Opening balance	455	197
Loan guarantee interest paid	10	28
Expenses Incurred	-	62
Payments Made	-	(125)
Funding provided in 2015 by D Ciclitira entities	222	-
Less 2014 inter company offset of the remaining balance owed to PMK	-	(226)
Amounts owed to Luna Trading including consultancy and business services	-	221
Amount owed to PCA	-	298
Total amounts outstanding to D Ciclitira entities	687	455

Luna Trading is the company through which PMG contract with D Ciclitira for consulting and business services. During the period, Luna Trading waived its charges to PMG for consultancy fees. Luna Trading charged £0.10m for loan guarantee in the first 6 months of 2015.

10.   Other

Copies of unaudited half-yearly 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: 82 Berwick Street, London W1F 8TP.

11.   Approval of Half-Yearly Financial Statements

The half-yearly financial statements were approved by the board of directors on 30 September 2015.

 

END

 

 

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