Preliminary Statement of Results-FY to 31 Dec 2011

RNS Number : 0300D

Immedia Group PLC

10 May 2012

 

IMMEDIA GROUP PLC

Preliminary Statement of Results for the FY to 31 December 2011

Immedia Group Plc ("Immedia" or the "Group"), which provides bespoke radio stations and a range of in-store media solutions for retailers, today announces its preliminary financial results for the year to 31 December 2011.

Overview

·      O2 Retail won as a significant new customer and contract extensions secured with existing customers including HSBC and SPAR

·      Trials using Immedia proprietary technology under way with valuable potential new customers

·      Major marketing investment in Q4 2011 already delivering a promising new business pipeline for 2012

·      Operating loss of £166,307 largely attributable to one-off £150,000 marketing expense (2010: loss £59,724)

·      EBITDA of £21,383 up as a percentage of turnover if marketing spend is excluded (2010: £52,530)

Financial Summary

	12 months to 31 December 2011	12 months to 31 December 2010
Revenue	£2,968,184	£3,509,421
EBITDA	£21,383	£52,530
Results from operating activities	£(166,307)	£(59,724)
Loss before income tax	£(164,500)	£(60,444)
Loss and total comprehensive income for the year attributable to equity shareholders of the parent	£(142,066)	£(48,566)
Basic and diluted loss per share	(1.04)p	(0.35)p
Year-end balance of cash and cash equivalents	£738,150	£817,242

Bruno Brookes, Chief Executive of Immedia, said: 

"Despite being a victim of the current UK economy, as illustrated by the negative headlines dominating the newspapers and demonstrated by some of our clients reducing spend, we have identified a new pool of potential retail and hospitality brands that are proactively developing a need to invest in services that improve customer experience and staff communications. Consequently, we have spent considerable time repositioning our own product and service message with a new web presence and marketing strategy which we launched in the fourth quarter of the year.

This has resulted in higher visibility and helped to secure a new client, O2 Retail. Following a successful tender process, we were selected to provide our unique 'LIVE' and localised content solution to all O2 retail stores using our proprietary technology - 'Dreamstream'.   The technology enables our clients to 'Storecast' live 'events' from flagship stores and other external locations to their retail estate. Together with these unique features 'Dreamstream'' delivers music strategy, localised marketing and interactive staff communications. 

There is no doubt that the last few years have been challenging for many businesses including Immedia. While we remain cautious about the economic climate for the forthcoming year, I remain confident that our services are more relevantthan ever before in assisting our clients to improve their position on the high street. I am also confident that our people and infrastructure are best placed to accelerate more new business."

Enquiries:

Immedia Group Plc
Bruno Brookes - Chief Executive	[phone]
Daniel Stewart & Company Plc
Paul Shackleton	[phone]

Chairman's Statement

2011 was a difficult year for the UK economy. Immedia, as a supplier to the retail sector, felt the consequences of the tightening of marketing budgets on turnover, which was down by 15.4% on the previous year.

As the outlook for the economy remained uncertain, the directors reviewed all of the activities of the business and as a result decided in the mid-year to make a substantial investment in sales and marketing with the objective of creating a platform from which to grow revenue.

A positioning statement 'The Sound of Your Brand' is now the central part of a media communications programme that began at the back end of the year. The full effect of this investment will be felt in 2012 and beyond but early indications are that the flow of new business enquiries has increased.

All other expense has been tightly controlled and cash balances have been substantially maintained.

The loss for the year of £142,066 is largely attributable to the £150,000 one-off expense of creating and tooling up for the marketing programme. You will see that EBITDA as a percent of turnover was up on 2010 if the marketing spend is excluded.

The determination to realise value for shareholders remains the Board's key strategic objective and all options to achieve this objective will be on the table for the coming year.

Geoff Howard-Spink

Chairman

Chief Executive's Review

I am pleased to present our full year results for the financial year ended 31 December 2011.

Results & Financial Performance

Revenues for the year were £2,968,184 (2010: £3,509,421).  Earnings before interest, tax, depreciation and amortisation (EBITDA) were £21,383 (2010: £52,530). Operating loss was £166,307 (2010: loss £59,724). Research and development tax credits of £22,434 (2009: £11,878) reduced the loss after tax attributable to equity shareholders to £142,066 (2010 loss £48,566).

The Group has remained operationally cash generative and ended 2011 with £738,150 cash in the bank (2010: £817,242).

During the year the Group suffered as a result of a number of our existing clients tightening their belt, reducing revenues year on year by some £540,000 compared to 2010. Most of these lost revenues were attributed to reduced marketing production, hardware installations and store development.

Commercial development

Despite being a victim of the current UK economy, as illustrated by the negative headlines dominating the newspapers and demonstrated by some of our clients reducing spend, we have identified a new pool of potential retail and hospitality brands that are proactively developing a need to invest in services that improve customer experience and staff communications. Consequently, we have spent considerable time repositioning our own product and service message with a new web presence and marketing strategy which we launched in the fourth quarter of the year.

This has resulted in higher visibility and helped to secure a new client, O2 Retail. Following a successful tender process, we were selected to provide our unique 'LIVE' and localised content solution to all O2 retail stores using our proprietary technology - 'Dreamstream'.   The technology enables our clients to 'Storecast' live 'events' from flagship stores and other external locations to their retail estate. Together with these unique features 'Dreamstream'' delivers music strategy, localised marketing and interactive staff communications. 

We have also expanded our sales team and have since signed agreements to appoint strategic individuals and partners to develop new commercial opportunities in specific sectors including e.g. the health sector. We expect to continue to develop similar positions throughout 2012.

We have improved our installations and maintenance business by adding more specialist partnership teams creating more efficiency and an even higher level of expertise to the sales force across the UK and Ireland. This is already opening new sales opportunities with collaborative solutions.

As mentioned in my 2010 report we are continuing to research and develop relationships outside the UK and expect to finalise new business in another territory this year.

Technology

We continue to invest in our own propriety technologies designed to offer flexibility in the delivery of our content services, helping our clients to future-proof their own requirements and further benefit from ancillary features like localised marketing, data collection and reduced maintenance requirements. In addition, our IT infrastructure has been further strengthened to deliver a wide range of interactive connectivity solutions to our clients.

Outlook

There is no doubt that the last few years have been challenging for many businesses including Immedia. While we remain cautious about the economic climate for the forthcoming year, I remain confident that our services are more relevant than ever before in assisting our clients to improve their customer experience. I am also confident that our people and infrastructure are best placed to accelerate more new business.

We are passionate about quality and continue to drive exceptional solutions and good value to our clients. This extends to our shareholders, where I and the Immedia team remain absolutely committed to shareholder value moving forward.

Bruno Brookes

Chief Executive

Consolidated statement of comprehensive income

for the year ended 31 December 2011

	Note	2011	2010
		£	£
Revenue		2,968,184	3,509,421
Cost of sales		(1,163,891)	(1,625,096)
Gross profit		1,804,293	1,884,325
Administrative expenses before depreciation, amortisation and impairment charges		(1,782,910)	(1,831,795)
Earnings before interest, taxation, depreciation, amortisation and impairment charges (EBITDA)		21,383	52,530
Depreciation, amortisation and impairment charges		(187,690)	(112,254)
Results from operating activities		(166,307)	(59,724)
Finance income		1,807	1,726
Finance cost		-	(2,446)
Net finance income/(cost)		1,807	(720)
Loss before income tax		(164,500)	(60,444)
Income tax income		22,434	11,878
Loss and total comprehensive income for the year attributable to equity shareholders of the parent		(142,066)	(48,566)
Continuing and total operations
Loss per share - basic and diluted	3	(1.04)p	(0.35)p

Consolidated balance sheet

At 31 December 2011

			2011 £		2010 £
Assets
Property, plant and equipment			205,112		218,585
Intangible assets			229,137		304,925
Total non-current assets			434,249		523,510
Current assets
Inventories			146,117		117,857
Trade and other receivables			744,146		319,177
Prepayments			89,932		122,461
Cash and cash equivalents			738,150		817,242
Total current assets			1,718,345		1,376,737
Total assets			2,152,594		1,900,247
Equity
Share capital			1,455,684		1,455,684
Share premium			3,586,541		3,586,541
Merger reserve			2,245,333		2,245,333
Retained losses			(6,804,794)		(6,662,728)
Total equity			482,764		624,830
Liabilities
Trade and other payables			150,000		-
Total non-current liabilities			150,000		-
Loans and borrowings			-		22,000
Trade and other payables			1,126,779		1,153,455
Deferred income			393,051		99,962
Total current liabilities			1,519,830		1,275,417
Total liabilities			1,669,830		1,275,417
Total equity and liabilities			2,152,594		1,900,247

Consolidated statement of changes in equity

	Attributable to equity shareholders of the Company
Total equity as at 31 December 2011	Share capital £	Share premium account £	Merger reserve £	Profit & loss account £	Total equity £
Balance at 1 January 2011	1,455,684	3,586,541	2,245,333	(6,662,728)	624,830
Equity settled share based payments	-	-	-	-	-
Transactions with owners	-	-	-	-	-
Loss and total comprehensive income for the year	-	-	-	(142,066)	(142,066)
Balance at 31 December 2011	1,455,684	3,586,541	2,245,333	(6,804,794)	482,764

Total equity as at 31 December 2010	Share capital £	Share premium account £	Merger reserve £	Profit & loss account £	Total equity £
Balance at 1 January 2010	1,455,684	3,586,541	2,245,333	(6,582,086)	705,472
Purchase of own shares by employee benefit trust	-	-	-	(23,360)	(23,360)
Equity settled share based payments	-	-	-	(8,716)	(8,716)
Transactions with owners	-	-	-	(32,076)	(32,076)
Loss and total comprehensive income for the year	-	-	-	(48,566)	(48,566)
Balance at 31 December 2010	1,455,684	3,586,541	2,245,333	(6,662,728)	624,830

Consolidated statement of cash flows

for the year ended 31 December 2011

		2011 £	2010 £
Cash flows from operating activities
Loss for the year before income tax		(164,500)	(60,444)
Adjustments for:
Depreciation, amortisation and impairment charges		187,690	112,254
Financial income		(1,807)	(1,726)
Financial expense		-	2,446
Profit on sale of property, plant and equipment		(1,300)	(376)
(Increase)/decrease in trade and other receivables		(149,828)	294,467
(Increase) in inventories		(28,260)	(38,179)
Increase/(decrease) in trade and other payables		173,797	(126,183)
Net cash from operating activities		15,792	182,259
Taxation
Taxation		22,436	-
Cash flows from investing activities
Proceeds from sale of property, plant and equipment		2,790	985
Interest received		1,807	1,726
Acquisition of property, plant and equipment		(96,122)	(97,594)
Acquisition of intangible assets		(3,795)	(39,040)
Net cash from investing activities		(95,320)	(133,923)
Cash flows from financing activities
Interest paid		-	(2,446)
Repayment of borrowings		(22,000)	(22,000)
Purchase of own shares for EBT		-	(23,360)
Net cash from financing activities		(22,000)	(47,806)
Net (decrease)/increase in cash and cash equivalents		(79,092)	530
Cash and cash equivalents at 1 January		817,242	816,712
Cash and cash equivalents at 31 December		738,150	817,242

Notes

The financial information set out in this preliminary announcement does not constitute statutory accounts as defined in section 435 of the Companies Act 2006. Statutory accounts for 2010 have been delivered to the registrar of companies, and those for 2011 will be delivered in due course.

The consolidated statement of comprehensive income, consolidated balance sheet at 31 December 2011, consolidated statement of changes in equity, consolidated statement of cash flows and associated notes have been extracted from the Group's 2011 statutory financial statements upon which the auditor's opinion is unqualified and which do not include any statements under sections 498(2) or 498(3) of the Companies Act 2006.

The 2011 accounts will be delivered to the registrar of companies following the Company's Annual General Meeting. The Annual Report and Notice of Annual General Meeting will be posted to the shareholders by 23 May 2012 and will be made available on the Company's website (www.immediaplc.com) at that time.

This preliminary announcement was approved by the Board on 9 May 2012.

1             Reporting entity

Immedia Group Plc (the "Company") is a company incorporated and domiciled in the United Kingdom.  The address of the Company's registered office and its principal place of business is The Old Brewery, The Broadway, Newbury, Berkshire RG14 1AU.

The consolidated financial statements of the Company as at and for the year ended 31 December 2011 comprise the Company and its subsidiaries (together referred to as the "Group").   The Group primarily is involved in marketing and communication services through radio and screen-based media together with the installation and maintenance of associated equipment.

2             Basis of preparation

The consolidated financial statements have been prepared and approved by the directors in accordance with International Financial Reporting Standards as adopted by the EU ("Adopted IFRSs").

The consolidated financial statements have been prepared in accordance with the same accounting policies adopted in the financial statements for the year to 31 December 2010.

The Directors have taken the settlement agreement made with a music licencing authority into account when reviewing forecasts of future cash flows of the Group.  They have also considered the Group's prospects for winning new business and reviewed a range of possible outcomes.  On the basis of current financial projections prepared up to the end of 2013, recent news of new contracts and of contract renewals, and continuing improvements in the management of costs, the Directors are satisfied that the Group has adequate resources to continue in operation for the foreseeable future and consequently the financial statements have been prepared on the going concern basis.

3             Loss per share

	2011 Number	2010 Number
Weighted average number of shares in issue	14,556,844	14,556,844
Less weighted average number of own shares	(832,374)	(681,153)
Weighted average number of shares in issue for basic loss per share	13,724,470	13,875,691
The basic and diluted loss per share are calculated using the after tax loss attributable to equity shareholders for the financial period of £142,066 (2010: loss of £48,566). The weighted number of shares used for the diluted loss per share is calculated after reflecting the outstanding share options throughout the year, but in accordance with IAS 33 the diluted basic loss per share is stated as the same amount as basic as there is no dilutive effect.

 

END

 

 

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