Final Results

RNS Number : 1770A

Talent Group PLC

18 March 2013

 



18  March 2013

Talent Group plc

("Talent", "Company" or the "Group")

Final results for the year ended 30 September 2012

Chairman's Statement

I am pleased to present the Company's results for the year ended 30 September 2012.

Although Group turnover has increased to £1,041,000 (2011: £874,000), gross profit was reduced to £292,000 (2011: £516,000), reflecting a different mix of income streams, After taxation, we have a retained loss for the year of £245,000 (2011: profit of £31,000).

The results for the full year are somewhat disappointing in view of an encouraging first half of the year which saw both our production companies, Talent Television and Talent Television South, engaged in significant levels of production activity. Talent Television was completing production of My Phone Genie, a 26-part children's series produced as an international co-production with Moonscoop of France, Telegael of Ireland, and ZDF of Germany. The series has subsequently been broadcast successfully on ITV, and the company is in discussions regarding a second series.

Talent Television South completed a second series of eight crime documentaries for The Crime and Investigation Network during the first half of the year, which were broadcast in the final quarter of 2012, achieving above average audiences for the Channel. A third series of six shows has just been commissioned for production in the 2012/13 financial year.

A number of other projects have also contributed to Group profitability. Talent Television South completed a documentary on The Richardsons, again for The Crime and Investigation Network. A further two documentaries, on Frankie Fraser and Broadmoor, have been commissioned and completed since the year end. Additionally, Talent South retains its involvement in the production of instructional DVDs, corporate films, and local television.

Whilst there was a notable lack of production activity during the second half of the 2011/12 financial year, development work continued unabated, and both companies have a range of projects, both for television and cinema, which are progressing and can be expected to contribute to Group profitability in future years.

Terry Bate

Chairman

14 March 2013

Business Review and Principal Activities

As the Chairman has stated above, the second half of the year was disappointing in terms of the level of production and therefore income. This was due in part to My Phone Genie being broadcast in Germany much later than we had anticipated which impacted on our expectations for the timing of a potential second series. That said, the series has performed well in the UK on ITV/CITV and the broadcaster has responded positively.  As a result we are looking at the prospect of funding a second series. We also have a number of other new scripted comedy and drama projects both for Kid's and prime-time television at various stages of development and pitching.

We have also embarked on a number of new relationships with third party creators and companies in order to stimulate greater activity in the genres of game show and formatted entertainment and reality.

As expected, our first theatrical feature film Outside Bet was released into cinemas by Universal last April and is currently available on DVD. It has started selling to other territories, including Australia, and we expect it will get a free-to-air television premiere in the UK at some point in the not too distant future. As a result of this film, we have established some new relationships and as such have acquired the rights to some other interesting projects including the co-production film rights to the successful British Asian stage play The Deranged Marriage, by Pravesh Kumar, which would be best described as in the same genre as Bend It Like Beckham and Monsoon Wedding.

Talent South continues to progress well, and we are all delighted that the audience figures continue to grow for Fred Dinenage - Murder Casebook, and that our strong relationship with the broadcaster has resulted in the commissioning of further one-off programmes and a third series of Murder Casebook.

Overall, whilst the general lack of production in the second half year thwarted the speed of our desired progress we have a strong development slate in both companies and a keen desire to return shareholder value. As experienced investors in this sector know, it can be frustrating but the next big and profitable 'hit' is always just around the corner and can therefore be very rewarding for those who persist.

Tony Humphreys

Managing Director

18  March 2013

 Further Enquiries

Talent Group plc
Tony Humphreys	Tel: [phone]
Merchant Securities Limited
Simon Clements	Tel: [phone]

Audited consolidated income statement for the year ended 30 September 2012

		2012	2011
	Notes	£'000	£'000
Revenue		1,041	874
Cost of sales		(749)	(358)
Gross profit		292	516
Administrative expenses		(494)	(441)
Operating (loss)/profit		(202)	75
Finance income		-	-
Finance costs		(43)	(55)
(Loss)/profit  before taxation		(245)	20
Taxation	2	-	11
(Loss)/profit for the year		(245)	31
(Loss)/profit  per share (pence)	3	(1.116p)	0.165p
Diluted (loss)/profit per share (pence)	3	(1.066p)	0.156p

The income statement has been prepared on the basis that all operations are continuing operations.

The accounting policies and the notes, which are set out in the Company's report and accounts, form an integral part of these financial statements.

There are no recognised gains or losses other than those passing through the income statement.

Audited consolidated balance sheet as at 30 September 2012

		2012		2011
	Notes	£'000	£'000	£'000	£'000
Assets
Non-current assets
Goodwill			1,082		1,082
Property, plant  & equipment			14		21
			1,096		1,103
Current assets
Inventories		138		55
Trade receivables		78		248
Cash & cash equivalents (excluding bank overdraft)	4	11		29
			227		332
Total assets			1,323		1,435
Equity and liabilities
Equity
Share capital			6,368		6,368
Share premium			11,822		11,822
Share option reserve			148		141
Retained earnings			(18,576)		(18,331)
Total equity			(238)		-
Current liabilities
Borrowings	5		880		862
Trade & other payables	6		681		573
Total Liabilities			1,561		1,435
Total equity & liabilities			1,323		1,435

Audited consolidated cash flow statement from the year ended 30 September 2012

		2012		2011
	Notes	£'000	£'000	£'000	£'000
Cash flows from operating activities
(Loss)/profit before taxation		(245)		20
Adjustments for:
Depreciation of tangible assets		7		12
Amortisation of intangible assets		-		25
Share option reserve		7		8
Interest received		-		-
Interest paid		43		55
		(188)		120
Decrease/(increase) in trade & other receivables		170		(257)
Decrease in inventories		(83)		(49)
Increase in other payables		108		127
		7		(59)
Tax refund received		-		11
Tax paid		-		-
Net cash from operating activities			7		(48)
Cash flows from investing activities
Purchase of property, plant and equipment		-		(2)
Interest received		-		-
Net cash used in investing activities			-		(2)
Cash flows from financing activities
Decrease in borrowings		(12)		-
Proceeds from issue of shares		-		130
Interest paid		(43)		(56)
Net cash used in financing			(55)		75
Net (decrease)/increase in cash and cash equivalents	7		(48)		25
Cash and cash equivalents at the beginning
of the year	7		29		4
Cash and cash equivalents at the end of the year	7		(19)		29

Audited consolidated statement of changes in equity from the year ended 30 September 2012

	Share Capital £'000	Share Premium £'000	Share Option Reserve £'000	Retained Earnings £'000	Total £'000
At 1 October  2010	6,329	11,731	133	(18,362)	(169)
Changes in equity
Profit for the year	-	-	-	31	31
Equity share option recognised	-	-	8	-	8
New shares issued	39	91	-	-	130
At 1 October  2011	6,368	11,822	141	(18,331)	-
Changes in equity
Loss for the year	-	-	-	(245)	(245)
Equity share option recognised	-	-	7	-	7
At 30 September 2012	6,368	11,822	148	(18,576)	(238)

Notes to the preliminary results for the year ended 30 September 2012

1.         Basis of preparation

These financial statements have been prepared in accordance with International Financial Reporting Standards, International Accounting Standards and Interpretations (collectively IFRS) issued by the International Accounting Standards Board (IASB) as adopted by European Union ("adopted IFRSs"), and are in accordance with IFRS as issued by the IASB.

The financial information set out above does not constitute the Company's statutory accounts for the years ended 30 September 2011 and 2012, but is derived from those accounts. Statutory accounts for 2011 have been delivered to the Registrar of Companies and those for 2012 will be shortly. The Auditors have reported on those accounts; their reports were unqualified and did not contain statements under the Companies Act 2006 section 498.

2.         Taxation

	2012	2011
	£'000	£'000
Domestic current year tax
UK corporation tax	-	-
Domestic prior year tax
UK corporation tax - refund	-	11
	-	11
Factors affecting the tax charge for the period:
(Loss)/profit on ordinary activities before taxation	(245)	20
Profit/(loss) on ordinary activities multiplied by the standard rate of
Corporation tax in the UK of 25 per cent. (2011: 21 per cent.)	(61)	4
Expenses not deductible for tax purposes	2	10
Depreciation in excess of capital allowances for the year	2	1
Other short-term timing differences	24	-
Utilisation of tax losses	33	(15)
Prior year tax	-	11
Current tax charge for the year	-	11

3.         Loss per share

	2012	2011
	£'000	£'000
Numerator
Basic/Diluted: Net (loss)/profit	(245)	31
Denominator
Basic: Weighted average shares	21,960,284	18,794,777
Effect of diluted securities: stock options	1,027,500	1,027,500
Diluted: Adjusted weighted average shares	22,987,784	19,822,277

Basic (loss)/profit per share is calculated by dividing the net (loss)/profit for the period attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period.

Diluted profit/(loss) per share is computed using the weighted average number of shares outstanding during the period adjusted for the dilutive effect of stock options outstanding for the period.

4.         Cash and cash equivalents

	2012	2011
	£'000	£'000
Cash at bank and in hand	11	29
Bank overdraft	(30)	-
	(19)	29

5.         Borrowings

	2012	2011
	£'000	£'000
Bank overdraft	30	-
Other loans	850	862
	880	862

The above borrowings include loans of £850,000 from Terry Bate, Non-Executive Chairman. On the first loan of £700,000, interest is payable monthly at the rate of a minimum of 6 per cent per annum. During the year to 30 September 2010 Mr Bate provided a further loan facility to the Company as production finance for a commission that was subsequently cancelled. At 30 September 2012 £150,000 remained outstanding under this facility (2011 - £162,000). Interest on this loan is payable at the rate of 7 per cent. per annum. The loans are unsecured and no guarantees were given.

a)         Ageing

The loans are due 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.

6.         Trade and other payables: amounts falling due within one year

	2012	2011
	£'000	£'000
Social security and other taxes	167	47
Other payables	-	33
Accruals and deferred income	514	493
	681	573

7.         Reconciliation of net cash flow to movement in cash and cash equivalents

	2012	2011
	£'000	£'000
Net (decrease)/ increase in cash and cash equivalents	(48)	25
Cash and cash equivalents at beginning of year	29	4
Cash and cash equivalents at end of year (note 4)	(19)	29

8.                     Financial commitments

	Office equipment 2012 £'000	Office equipment 2011 £'000	Land and buildings 2012 £'000	Land and buildings 2011 £'000
At 30 September 2012, the Group had commitments under non - cancellable operating leases as follows:
Expiry date:
Less than one year	2	-	-	-
Between two and five years	-	2	-	-

At 30 September 2012 there are no terms of renewal or purchase options and escalation clauses.  There are also no restrictions imposed by lease arrangements concerning dividends, additional debt and further leasing.

9.         Dividend

The Directors do not propose a dividend payment.

10.        Copies of report and accounts

Copies of the Report and Accounts will be posted to shareholders shortly, will be available from the Company's registered office Studio 31, FBC, 40 Bowling Green Lane, London EC1R 0NE and will be available from the Company's website www.talenttv.com.

 

END

 

 

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