Unaudited Preliminary Results

9 February 2015 Guscio PLC ("Guscio" or the "Company" or the "Group") Unaudited preliminary results for the year ended 30 September 2014 Chairman's Report I am pleased to present the Company's results for the year ended 30 September 2014. As shareholders will be aware, the Company disposed of its two trading subsidiary companies on 8 September 2014, and was re-classified as an Investing Company in accordance with the AIM Rules for Companies. In last year's Chairman's Report, my predecessor as Chairman, Terry Bate, highlighted a concern that the Board had at that time about the future sustainability of the Group given the trading prospects of its two businesses. It was against this background that the decision was taken to dispose of those businesses and to refocus the Company as an Investing Company. This year's financial statements therefore reflect the disposal of the business. The loss from continuing operations was £177,000 (2013: £113,000 loss) and a profit from discontinued operations, largely reflecting the non cash profit recorded on the disposal of the subsidiary companies, resulted in an overall profit for the year of £467,000 (2013: £289,000 loss). Since the year end, the Company has raised £200,000 from a placing of ordinary shares which has stabilised the Company's financial position and has allowed it to make its first investment, being an investment of £125,000 in Sportsdata Limited in the form of a convertible loan. Sportsdata Limited is a technology company that has developed and implemented a website application for monitoring and improving the physical literacy of children in association with the Youth Sports Trust. The investment in Sportsdata Limited is in accordance with the Company's Investing Policy which is to invest in and/or acquire technology and media companies and/or assets where the Board believes there are opportunities for growth which, if achieved, will be earnings enhancing for shareholders. I joined the Board as Non-Executive Chairman on 26 January 2015 and look forward to helping the Company identify and make further investments which will enhance shareholder value. A copy of the Company's report and accounts for the year ended 30 September 2014 together with a notice for its annual general meeting, to be held at 2.00 p.m. on 25 March 2015 at the offices of Peterhouse Corporate Finance Limited, 3rd Floor New Liverpool House, 15-17 Eldon Street, London EC2M 7LA, will shortly be posted to shareholders and will be made available on the Company's website www.guscioplc.com. Richard Thompson Chairman 6 February 2015 For further information please contact: Guscio PLC Tony Humphreys / Marcus Yeoman 0203 056 4737 Sanlam Securities UK Limited Virginia Bull / Simon Clements 020 7628 2200 Peterhouse Corporate Finance Limited Lucy Williams / Eran Zucker 020 7469 0936 Consolidated statement of comprehensive income for the year ended 30 September 2014 Notes 2014 2013 £'000 £'000 Continuing Operations Revenue 3 - - Cost of sales - - Gross profit - - Administrative expenses 3 (177) (113) Operating loss (177) (113) Finance income 5 - - Finance costs 6 - - Loss before taxation (177) (113) Income tax 7 - - Loss for the year from continuing operations (177) (113) Discontinued Operations Profit/(Loss) for the year from discontinued 2 644 (176) operations (attributable to owners of the parent) Profit/(Loss) for the year 467 (289) Other comprehensive income - - Comprehensive profit/(loss) for the year 467 (289) Earnings per share from continuing operations attributable to the equity holders of the Company during the year: 2014 2013 Basic earnings/(loss) per share 9 2.24p (1.31p) Diluted earnings/(loss) per share 9 2.15p (1.26p) There are no recognised gains or losses other than the results for the period as set out above. Consolidated statement of financial position at 30 September 2014 2014 2013 Notes £'000 £'000 £'000 £'000 Assets Non-Current Assets Goodwill 10 - 1,082 Property, plant & Equipment 11 - 3 Investments 12 - - - 1,085 Current Assets Inventories 13 - 85 Trade Receivables 14 66 161 Cash & Cash equivalents - 13 66 259 Total Assets 66 1,344 Equity and liabilities Equity Share capital 16 6,369 6,368 Share premium 11,871 11,822 Share option reserve 3 148 Retained earnings (18,250) (18,865) Total Equity (7) (527) Current Liabilities Borrowings 17 - 920 Trade & other payables 18 73 951 Total Liabilities 73 1,871 Total equity & liabilities 66 1,344 Consolidated cash flow statements for the year to 30 September 2014 2014 2013 £'000 £'000 Cash flows from continuing operations Operating loss (177) (113) Adjustments for: Share option expense 3 - Decrease in trade & other receivables 16 - (Decrease) in trade & other payables (258) - Cash generated from continuing (416) (113) operations Cash flows from discontinued operations Operating profit/(loss) 698 (134) Depreciation - 3 Loss on disposal of fixed assets 3 7 Loss on disposal of goodwill 1,082 - Decrease/(increase) in trade & other 129 (83) receivables Decrease in inventories 85 53 (Decrease)/increase in trade & other (620) 270 payables Net (decrease)/increase in borrowing (892) 42 Cash generated from discontinued 485 158 operations Net cash inflow from operating 69 45 activities Cash flows from investing activities Interest received 5 - 1 Purchase of property, plant & 11 - (5) equipment Sale proceeds of fixed asset - 6 disposals Net cash used in investing activities - 2 Cash flows from financing activities Interest paid (discontinued 6 (54) (43) operations) Issue of new shares (continuing 16 - operations) Net cash from financing activities (54) (43) Net increase in cash & cash 15 15 4 equivalents Cash and cash equivalents at 1 15 (15) (19) October Cash and cash equivalents at 30 15 - (15) September Statement of changes in equity for the year ended 30 September 2014 Share Share Share Retained Total Capital Premium Option Earnings Reserve £'000 £'000 £'000 £'000 £'000 Balance at 1 October 2012 6,368 11,822 148 (18,576) (238) Comprehensive loss for the year - - - (289) (289) 6,368 11,822 148 (18,865) (527) Balance as at 30 September 2013 Balance at 1 October 2013 6,368 11,822 148 (18,865) (527) Comprehensive income for the year - - - 467 467 Issue of shares 1 49 - - 50 Equity share options expired - - (148) 148 - Equity share options issued - - 3 - 3 At 30 September 2014 6,369 11,871 3 (18,250) (7) Share capital relates to the nominal value of shares issued. Share premium relates to the amounts subscribed for share capital in excess of the nominal value of the shares. The share option reserve arose on the grant of share options to employees under the employee share option plan. At 30 September 2014 the Company had no employees other than the directors. Retained earnings relates to cumulative profits and losses recognised in the statement of comprehensive income. Notes to the consolidated financial statements for the year to 30 September 2014 1 Accounting policies 1.1 Basis of preparation and consolidation The Company's financial statements are prepared under the historical cost convention. The Company's financial statements have been prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union and applied in accordance with the provisions of the Companies Act 2006 applicable to companies reporting under IFRS. The Group financial statements consolidate the financial statements of the Company and its subsidiary undertakings made up to 30 September 2014. The principal accounting policies adopted by the Group are set out below. 1.2 Going concern The disposal of the trading subsidiaries was completed during the year and as a result, Guscio Plc is now a non trading holding Company. No substantive warranties or indemnities were given to the purchasers of the trading subsidiaries and therefore the directors are not expecting any further liabilities arising from the disposal of these companies. £250,000 has been raised in three separate placings, with £50,000 being raised before the balance sheet date and £200,000 being raised subsequent to the year end. These funds have allowed all historical creditors to be paid and has put the Company in a position where it has sufficient cash resources to meet the on going expenses for at least a further 18 months. It is anticipated that the Company may make new investments during this period but the directors will ensure that any such investments can be funded in a prudent way. Therefore after making enquiries, the directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. The Group therefore continues to adopt the going concern basis in preparing its consolidated financial statements. 1.3 Revenue recognition Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue consists of the total value of goods sold in the year, net of value added tax and comprises amounts invoiced in respect of making productions. Where a production straddles two financial years, the amount of revenue, costs and profit are pro-rated based on the proportion of the production completed at year end. Distribution revenue arises from the licensing of programme rights which have been obtained under distribution agreements with either external parties or Group companies. Distribution income is recognised in the income statement on signature of the licence agreement and represents amounts receivable on such contracts. 1.4 Property, plant and equipment Items of property, plant and equipment are stated at the cost of acquisition or production cost less accumulated depreciation and impairment losses. Depreciation is calculated to write down the cost less estimated residual value of all tangible fixed assets by the reducing balance method. The rates applicable are: Fixtures and fittings - 15% Office equipment - 33% Items of property, plant and equipment are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the assets carrying amount exceeds its recoverable amount. 1.5 Investments Investments in subsidiaries are included at cost less any accumulated impairment losses. 1.6 Taxation Current taxes are based on the results of the Group companies and are calculated according to local tax rules, using the tax rates that have been enacted or substantively enacted by the balance sheet date. Deferred tax is provided in full using the balance sheet liability method for all taxable temporary differences arising between the tax bases of assets and liabilities and their carrying values for financial reporting purposes. Deferred tax is measured using currently enacted or substantively enacted tax rates. Deferred tax assets are recognised to the extent the temporary difference will reverse in the foreseeable future and that it is probable that future taxable profit will be available against which the asset can be utilised. 1.7 Foreign currencies Transactions in foreign currencies are translated at the exchange rate ruling at the date of the transaction. Monetary assets and liabilities in foreign currencies are translated at the rates of exchange ruling at the balance sheet date. All exchange differences are dealt with through the income statement. 1.8 Leased assets Costs in respect of operating leases are charged on a straight line basis over the lease term. Leasing agreements or hire purchase contracts which transfer to the Group substantially all the benefits and risks of ownership of an asset are treated as if the asset had been purchased outright. The assets are included in fixed assets and the capital element of the leasing commitments is shown as obligations under finance leases. The lease rentals are treated as consisting of capital and interest elements. The capital element is applied to reduce the outstanding obligations, and the interest element is charged against profit so as to give a constant periodic rate of charge on the remaining balance outstanding at each accounting period. Assets held under finance leases are depreciated over the shorter of the lease terms and the useful economic life of equivalent owned assets. 1.9 Financial instruments The Group uses financial instruments other than derivatives comprising cash and various items such as trade debtors, other creditors etc. that arise from its operations. The main purpose of these financial instruments is to raise finance for the Group's business. The board approves treasury policies and senior management directly controls day-to-day operations. Surplus cash funds are deposited with third party banks with high credit ratings in floating rate deposits. The security of these deposits and the interest rates earned are monitored on a regular basis against the products and services of competing financial institutions. The fair values of the financial instruments at the period end approximate the book values. 1.10 Inventories and work in progress Work in progress represents expenditure relating to productions which have not yet been completed and is valued at the lower of cost and net realisable value. It is the Group's policy to write off amounts relating to productions that do not proceed within one year of inception. 1.11 Goodwill Goodwill arising on an acquisition represents the excess of the cost of the acquisition over the Group's interest in the fair value of identifiable assets and liabilities acquired as at the date of the exchange transaction. Goodwill is stated at cost less any accumulated impairment losses. Where an indication of impairment exists, goodwill is written down immediately to its recoverable amount. An impairment review is performed annually in which the recoverable amount of the goodwill is calculated and compared with the carrying value within the accounts. 1.12 Intellectual property rights Intellectual property rights are shown at cost and are being written off on a straight line basis over ten years, or written-off in full if considered to have no further residual value. Amortisation is included in administrative expenses in the income statement. 1.13 Cash and cash equivalents Cash and cash equivalents compromise cash at bank and in hand and short term deposits. Short term deposits are defined as deposits with an initial maturity of three months or less. Bank overdrafts that are repayable on demand and form an integral part of the Company's cash management are included as a component of cash and cash equivalents for the purposes of the cash flow statement. 1.14 Trade and other payables Trade and other payables represent liabilities for goods and services provided to the Company prior to the year end which remain unpaid at the year end. Current liabilities represent those amounts falling due within one year. 1.15 Share based payments In accordance with IFRS 2 share based payments, the Group reflects the economic cost of awarding shares and share options to employees by recording an expense in the income statement equal to the fair value of the benefit awarded, fair value being determined by reference to option pricing models. The expense is recognised in the income statement over the vesting period of the award. 1.16 Trade and other receivables Trade and other receivables are recognised by the Company and carried at the original invoice amount less an allowance for any uncollectible or impaired amounts. An estimate for the doubtful debts is made when collection of the full amount is no longer probable. Uncollectible receivables are written off as soon as the payment loss has been established. 1.17 Development costs Development costs are costs incurred in the course of developing programmes for commission and are written off as incurred. 1.18 Accounting estimates and judgements Details of significant accounting estimates and judgements have been disclosed under the relevant note or accounting policy for each area where disclosure is required. Principally these are valuation of work in progress, trade receivables acquired intangible assets, goodwill impairment testing and revenue recognition. 1.19 Borrowing Costs Borrowing costs are charged to the profit and loss account on an accruals basis, and added to the loan in liabilities if unpaid at year end. 1.20 Application of new EU endorsed accounting standards, amendments to existing EU endorsed standards and interpretations New Standards, amendments and interpretations effective for the first time for the financial year beginning 1 October 2013, but not currently relevant to the Group (although they may affect the accounting for future transactions and events): IAS 1 (amendment) - `Presentation of items of other comprehensive income' IAS 12 (amendment) - `Income taxes' IAS 16 (annual improvements 2011) - `Property, Plant and Equipment' IAS 19 (amendment) - `Employee benefits' IAS 34 (annual improvements 2011) - `Interim financial reporting' IAS 32 (annual improvements 2011) - `Financial Instruments: Presentation' IFRS 1 (amendment) - `First time adoption' IFRS 7 (amendment) - `Financial Instruments' IFRS 13 - `Fair value measurement' IFRIC 20 (interpretation) - `Stripping costs in the production phase of a surface mine' The above revised standards have not had any impact on the Company's financial statements in the current year. The Company will apply for the above standards prospectively to all future transactions and events. New Standards, amendments and interpretations issued, but not effective for the financial year beginning 1 October 2013 and not early adopted. IAS 16 (annual improvements 2012) - `Property, Plant and Equipment' - effective 1 July 2014 IAS 19 (amendment) - `Employee benefits' - effective 1 July 2014 IAS 27 (revised 2011) - `Separate Financial statements' - effective 1 January 2014 IAS 28 (revised 2011) - `Associates and joint ventures' - effective 1 January 2014 IAS 32 (amendment) - `Financial Instruments: Presentation' - effective 1 January 2014 IAS 36 (amendment) - `Impairment of assets' - effective 1 January 2014 IAS 37 (annual improvements 2012) - `Provisions, contingent liabilities and contingent assets' - effective 1 July 2014 IAS 39 (annual improvements 2012) - `Financial instruments: Recognition and measurement' - effective 1 July 2014 IAS 39 (amendment) - `Financial instruments: Recognition and measurement' - effective 1 January 2014 IAS 40 (annual improvement 2013) - `Investment Property' - effective 1 July 2014 IFRS 1 (annual improvement 2013) - `First time adoption' - effective 1 July 2014 IFRS 2 (annual improvement 2012) - `Share-based Payment' - effective 1 July 2014 IFRS 3 (annual improvement 2012) - `Business combinations' - effective 1 July 2014 IFRS 3 (annual improvement 2013) - `Business combinations' - effective 1 July 2014 IFRS 8 (annual improvement 2012) - `Operating segments' - effective 1 July 2014 IFRS 9 - `Financial instruments' - effective 1 January 2015 IFRS 9 (amendment) - `Financial instruments' - effective date to be determined IFRS 10 (amendment) - `Consolidated financial statements' - effective 1 January 2014 IFRS 11 - `Joint arrangements' - effective 1 January 2014 IFRS 12 - `Disclosures of interests in other entities' - effective 1 January 2014 IFRS 13 (annual improvement 2012) - `Fair value measurement' - effective 1 July 2014 IFRS 13 (annual improvement 2013) - `Fair value measurement' - effective 1 July 2014 IFRIC 21 (interpretation) - `Levies' - effective 1 January 2014 The directors do not anticipate that the adoption of these interpretations in future reporting periods will have a material impact on the Company's results. 2 Discontinued operations Analysis of the results of discontinued operations and the result recognised on the re-measure of assets or disposal Group is as follows: 2014 2013 £'000 £'000 Revenue 562 677 Cost of sales (491) (459) Administrative expenses (327) (352) Finance costs (54) (43) Finance income - 1 Loss on discontinued operations (310) (176) Profit recognised on the re-measurement of assets and liabilities on disposal 954 - Profit/(Loss) for the year from discontinued operations 644 (176) See notes 8 and 12 for further details. 3 Revenue and loss on discontinued and continued activities before taxation The revenue and loss on discontinued activities before taxation are primarily attributable to the creation, development and production of television programmes. The loss on continuing activities before taxation is primarily attributable to investing in companies and assets. By geographical origin For the year to 30 September 2014: Revenue Profit Total Total assets liabilities before tax £'000 £'000 £'000 £'000 United Kingdom 321 467 66 (73) Rest of Europe 162 - - - Asia 79 - - - 562 467 66 (73) All revenue is from discontinuing operations and profit before tax is from both discontinued operations and continuing operations, see note 2. For the year to 30 September 2013: Revenue Loss before Total Total tax assets liabilities £'000 £'000 £'000 £'000 United Kingdom 556 (289) 1,344 (1,871) Rest of Europe 121 - - - Asia - - - - 677 (289) 1,344 (1,871) Total assets include property, plant and equipment and goodwill, all of which are allocated to operations within the UK. Non cash expenses such as depreciation and amortisation are also allocated to operations in the UK. 2014 2013 £'000 £'000 Loss before taxation is arrived at after charging: Depreciation of tangible fixed assets - 3 Loss on disposal of fixed assets 3 7 Auditors' remuneration : - audit of the annual accounts of the Group 12 12 - other services relating to taxation 4 2 Provision for bad debt - 1 4 Directors and employees 2014 2013 £'000 £'000 Staff costs during the year were as follows: Wages and salaries 248 256 Social security costs 28 31 Share-based payments to employees 3 - 279 287 All staff costs are included within discontinued operations, except for the share-based payments to employees. The monthly average number of employees during the year was made up as follows: No. No. Production 4 4 Administration 2 2 Management 1 1 7 7 £'000 £'000 Details of emoluments paid to directors are as follows: Emoluments 222 245 All directors emoluments are included within discontinued operations. [[TAB_STOP_RIGHT]]The emoluments of directors disclosed above include the following amounts paid to the highest paid director: £'000 £'000 Director emoluments 78 85 5 Finance income 2014 2013 £'000 £'000 Interest receivable - 1 6 Finance costs 2014 2013 £'000 £'000 Interest payable 54 43 All amounts are included within discontinued operations. 7 Taxation 2014 2013 £'000 £'000 Domestic current year tax UK corporation tax - - Domestic prior year tax UK corporation tax - repayment - - - - Factors affecting the tax charge for the period: Profit/(Loss) on ordinary activities before 467 (289) taxation Profit/(Loss) on ordinary activities 94 (58) multiplied by the standard rate of Corporation tax in the UK of 20% (2013 - 20%) Expenses not deductible for tax purposes 215 - Income not taxable (395) - Other short term timing differences 6 24 Deferred tax not recognised 80 34 Current tax charge - - 8 Related party transactions On 12 August 2014, the Company entered into two separate conditional agreements to dispose of its entire shareholdings in (i) Talent Television South Limited and (ii) Talent Holdings Limited and its subsidiary undertakings. As detailed below, both transactions were to related parties and were therefore subject to shareholder approval. Both transactions were approved at a General Meeting held on 8 September and therefore the sales completed on that date. Pursuant to the Sale and Purchase Agreement for Talent Television South Limited, Stitchcombe Productions Limited, a Company which is beneficially owned and controlled by Bob Benton, who was at that stage a Non-Executive Director of the Company, and his wife, acquired the entire issued share capital of Talent Television South Limited for a maximum cash consideration of £42,000. Of the consideration, £30,000 was payable on completion and the remainder was paid subsequent to the year end. The amount of intercompany debt to be novated to and assumed by Talent 2014 Limited for the acquisition of Talent Holdings Limited assumed that the consideration monies became due and payable to the Company under the Talent South Sale and Purchase agreement. 9 Loss per share (a) Basic Basic earnings per share is calculated by dividing the loss attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the year. The calculation of the basic loss per ordinary share is based on: 2014 2013 Number Number Weighted average number of Ordinary shares in issue during the period 20,840,286 21,960,284 Profit/(Loss) for the year (£'000) 467 (289) (b) Diluted Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares. The Company has one category of dilutive potential shares and share options. A calculation is performed to determine the number of shares that could have been acquired at fair value (determined as to the average annual market share price of the Company's shares) based on the monetary value of the subscription rights attached to outstanding share options. The number of shares calculated as above is compared with the number of shares that would have been issued assuming the exercise of the share options. The calculation of diluted earnings per share is based on: 2014 2013 Number Number Weighted average number of Ordinary shares in issue 20,840,286 21,960,284 Adjustments for dilutive effect of: - Employee share options 856,008 867,500 Weighted average number of ordinary shares for diluted earnings per share 21,696,294 22,827,784 10 Goodwill £'000 Group Cost At 1 October 2012 and 30 September 2013 1,082 Disposals During the year to 30 September 2014 (1,082) Net book amount as at 30 September 2014 - Net book amount as at 30 September 2013 1,082 See notes 8 and 12 for further details. 11 Property, plant and equipment Office Equipment Fixtures and Total £'000 fittings £'000 £'000 Group Cost At 30 September 2012 137 37 174 Additions D 5 5 - Disposals (134) (37) (171) ___________________­­­ ________ ________ At 30 September 2013 8 - 8 Additions in year - - - Disposals (8) - (8) At 30 September 2014 - - - Depreciation At 1 October 2012 129 32 161 Charge for the year 3 - 3 Disposals (127) (32) (159) At 31 September 2013 5 - 5 Charge for the year - - - Disposals (5) - (5) At 30 September 2014 - - - Net book value At 30 September 2014 - - - Net book value At 30 September 2013 3 - 3 12 Fixed asset investments Subsidiary undertakings £'000 Company Cost - At 1 October 2013 6,344 Amounts written off - At 1 October 2013 (4,145) Net book amount at 30 September 2013 2,199 Additions during the year to 30 September 2014 - Disposals during the year to 30 September 2014 (1,323) Net book amount at 30 September 2014 876 Details of the Group's investments, which are wholly owned by the parent Company and are included in the consolidated financial statements, are as follows: Name of entity Principal activity Country of incorporation RMR Design Associates Ltd Dormant England & Wales Guscio 2 Limited Dormant England & Wales Fair value information has not been disclosed for the investments as their fair value cannot be measured reliably. This is because the investments are not traded on an active market. On 12 August 2014, the Company entered into two separate conditional agreements to dispose of its entire shareholdings in (i) Talent Television South Limited and (ii) Talent Holdings Limited and its subsidiary undertakings. As detailed below, both transactions were to related parties and were therefore subject to shareholder approval. Both transactions were approved at a General Meeting held on 8 September and therefore the sales completed on that date. Further details of the terms of these disposals are explained in the related party note. The Companies which were disposed of during the year were as follows: Name of entity Principal activity Country of incorporation Talent Holdings Ltd Holding company England & Wales Talent Television Ltd Television production and England & Wales development Talent Television Television production and England & Wales South Ltd development Name of entity Principal activity Country of incorporation Talent Films Ltd Dormant England & Wales Talent Kids Ltd Dormant England & Wales Talent Music Ltd Dormant England & Wales Talent Theatre Dormant England & Wales Productions Ltd KMB Productions Ltd Dormant England & Wales 13 Inventories 2014 2013 £'000 £'000 Work in progress - 85 14 Trade and other receivables 2014 2013 £'000 £'000 Due within one year: Amounts due from Group undertakings - - Other receivables 63 61 Prepayments and accrued income 3 100 66 161 The above items represent financial assets (financial instruments) of the Group. 15 Cash and cash equivalents 2014 2013 £'000 £'000 Cash at bank and in hand - 13 Bank overdraft - (28) - (15) 16 Share capital 2014 2013 £'000 £'000 Allotted, called up and fully paid 3,378,506 (2013 - 21,960,284) Ordinary shares of 0.1p (2013 - 1p) each 3 220 1,689,253 B Deferred shares of 12.9p each 218 - 62,102,847 Deferred shares of 9.9p each 6,148 6,148 6,369 6,368 On 8 September 2014, 1,694,911 Ordinary shares of 0.1 pence each in the Company were issued raising £50,000 before expenses for the benefit of the Company. The Subscribers were issued with one Warrant for each ordinary share subscribed for and these warrants will be exercisable at the subscription Price (being 2.95 pence per share) at any time during the five year period from the date of issue. In order to carry out the Subscription described above, it was necessary to reduce the nominal value of the Company's issued Ordinary Shares at that date to an appropriate level which was less than the Subscription Price. Accordingly, a share reorganisation was effected and became effective from 8 September 2014 on the following basis: a. the previous Ordinary Shares of 1p each were consolidated into ordinary shares of 13p each at a ratio of 13 existing Ordinary Shares for every 1 new ordinary share of 13p each; and b. each of the new ordinary shares of 13p each were then subdivided into and reclassified as one New Ordinary Share (being an ordinary share in the capital of the Company with a nominal value of 0.1p each) and one New Deferred Share (being a B deferred share in the capital of the Company of 12.9p nominal value). The New Deferred Shares carry negligible value as they do not carry any rights to vote or dividend rights and have not be admitted to trading on AIM and will not be transferable. The New Deferred Shares have limited rights, and are subject to the restrictions, set out in the Company's New Articles. It is intended that in due course, all deferred shares in the capital of the Company will be repurchased by the Company for an aggregate of £1 and cancelled. The rights attaching to the New Ordinary Shares of 0.1 pence will be identical in all respects to those of the Existing Ordinary Shares. Shareholders with a holding of less than 13 Existing Ordinary Shares were not entitled to any New Ordinary Shares and any fractions of Ordinary Shares arising from the Capital Reorganisation were aggregated and sold for the benefit of the Company. 17 Borrowings Current borrowings 2014 2013 £'000 £'000 Overdraft - 28 Other loans - 892 - 920 Other loans related to amounts provided by T Bate, former Non-Executive Chairman. Interest was payable monthly at the rate of 6% per annum on the first £700,000, and interest at 7% per annum was payable upon repayment of the balance. The loans were unsecured and no guarantees were given. a) Ageing The loans were repayable on demand. b) Fair values Cash and cash equivalents The carrying value approximates to fair value. Other assets and liabilities No disclosure of fair value has been made as the carrying value is a reasonable approximation of the fair value. 18 Trade and other payables: Amounts falling due within one year 2014 2013 £'000 £'000 Amounts owed to Group undertakings - - Social security and other taxes - 97 Other payables 46 68 Accruals and deferred income 27 786 73 951 With the exception of social security and other taxes, the above items represent financial liabilities (financial instruments) of the Group. 19 Reconciliation of net cash flow to movement in cash and cash equivalents 2014 2013 £'000 £'000 Net increase in cash and cash equivalents 15 4 Cash and cash equivalents at beginning of (15) (19) year Cash and cash equivalents at end of year - (15) 20 Financial commitments Neither the Group nor the Company have commitments under non-cancellable operating leases as follows: Capital commitments Neither the Group nor the Company had any capital commitments at 30 September 2014. 21 Loans from related parties 2014 2013 £'000 £'000 Loans from T Bate, former Non-Executive - 892 Chairman Further details of these loans are provided in note 17. 22 Share-based payment transactions 2014 2014 2013 2013 No. of Weighted No. of Weighted options average options average exercise price exercise price (pence) (pence) Outstanding at 1 October 867,500 - 1,027,500 3.42 - Granted 676,832 4.18 - 3.00 - Forfeited (867,500) - - - - Exercised - - - - - Expired - - (160,000) 7.50 Outstanding at 30 676,832 867,500 September Exercisable at 30 676,832 867,500 September The estimated fair value was calculated by applying the Black Scholes model. The exercise price of all the options granted is equal to the share price at time of grant. The new warrants issued can be exercised at any time before 8 September 2019. The model inputs, in addition to the above, were: Risk free rate 2% Expected volatility 20% Gross dividend yield 0% The weighted average estimated fair value of each warrant granted in the general employee share option plan is 4.18p. Date of grant Exercise Latest Estimated Number of Number of price exercise fair value options options date 2014 2013 July 2008 7.50 July 2018 3.16 - 5,000 August 2010 2.00 August 2020 2.47 - 312,500 March 2011 3.00 March 2021 3.58 - 550,000 September 2014 2.95 September 4.18 676,832 - 2019 676,832 867,500 All share-based payments are equity rather than cash based. 23 Financial Risk Factors Risk management objectives The Group manages financial risks relating to the companies within the Group through regular review by the board. Capital risk management The Group aims to manage its overall capital so as to ensure that companies within the Group continue to operate as a going concern, whilst providing an adequate return to shareholders. The Group's capital structure represents the equity attributable to the shareholders of the Company together with borrowings and cash and cash equivalents. The structure is reviewed on a quarterly basis to ensure that an appropriate level of gearing is being used. Market risk Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. The principal ways in which the Group is exposed to such fluctuations is through interest rate risk. Interest rate risk management The Group has an exposure to interest rate risk arising principally on borrowings which are at fixed rates of interest. The only borrowings of the Group are disclosed in note 17. Credit risk Credit risk is the risk that a counter-party will cause a financial loss to the Group by failing to discharge its obligation to the Group. The Group manages its exposure to this risk by having fixed contracts with known suppliers and companies. Liquidity risk Liquidity risk is the risk that companies within the Group will encounter difficulty in meeting obligations associated with financial liabilities. To counter this risk, the Group operates monthly cash flow management. Maturity analysis of financial liabilities and liquidity risk Details of the Group's borrowings are given in note 17. 24 Post Balance Sheet Events On 8 October 2014 the Company raised £150,000 following the issue of 2,835,538 ordinary shares at a price of 5.29p per share. In connection with the subscription, the Company has entered into a warrant instrument pursuant to which the Company issued two new warrants for every three ordinary shares subscribed for. Accordingly, the Company has issued a total of 1,890,356 new warrants pursuant to the warrant instrument. These new warrants are exercisable at the subscription price of 5.29p per share and can be exercised at any time during the three year period from admission. On 29 October 2014 the Company raised £50,000, by way of a subscription for 945,179 new ordinary shares at a price of 5.29 pence per share. In connection with the subscription, the Company has entered into a warrant instrument pursuant to which the Company issued two new warrants for every three Ordinary Shares subscribed for. Accordingly, the Company has issued a total of 630,119 new warrants pursuant to the warrant instrument. These new warrants are exercisable at the subscription price of 5.29p per share and can be exercised at any time during the three year period from admission. Subsequent to the year end the Company has invested in Sportsdata Limited and has entered into an agreement to provide a £125,000 nominal unsecured convertible loan note. This loan note is repayable on the first anniversary of drawdown and has an annual interest rate of 5%, which is payable on a quarterly basis. The Company is entitled to convert the loan into ordinary shares at a valuation equivalent to £1.125 million. On 29 December 2014 some share options were exercised at a price of 5.29p and therefore the Company issued 63,012 ordinary shares. On 30 January 2015 some share options were exercised at a price of 5.29p and therefore the Company issued 157,529 ordinary shares.

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