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Forever Broadcast (FOB)

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Wednesday 13 November, 2002

Forever Broadcast

Final Results

Forever Broadcasting PLC
13 November 2002

For Immediate Release: 13 November 2002

                            FOREVER BROADCASTING PLC


Forever Broadcasting plc, the Newcastle-based independent radio company, today
announces preliminary results for the year ended 30 September 2002.


•         Turnover of £3.8m (2001: £2.17m), representing some 27% like for like

•         Normalised operating loss for the period £2.14m (2001: £2.23m),
          reflecting a full year's trading at all five radio stations

•         Loss per share of 38.9p (2001: 26.2p)

•         Good progress operationally with record numbers of listeners achieved

•         35% increase in total hours listened

•         Advance bookings significantly higher than at the corresponding time
          last year

•         Overhead cost base reduced by almost 15% since October 2001

•         Worthing licence awarded to Splash FM, in which Forever Broadcasting
          has a 35% stake

•         The company has announced in a separate announcement today that
          following the completion of a strategic review, it has decided to 
          commence discussions with potential investors, including a potential 
          MBO led by Eric Lawrence

Commenting on the results, John Josephs, Chairman, said:

'Although the year was more difficult than foreseen twelve months ago,
operationally good progress has been made. Our audience growth has been
outstanding, particularly when considered alongside an increase in total hours
listened of 35% but advertising growth was lower than expected.  The Board has
carried out a strategic review of all options, including a possible MBO.  We
will of course keep shareholders updated on any significant developments as


John Josephs                                                0191 286 0000
Forever Broadcasting

David Simonson/Nicola Davidson                              020 7606 1244
Merlin Financial

Chairman's Statement and Operating Review

The year ended 30 September 2002 was more difficult than foreseen twelve months
ago.  The downturn in national advertising has lasted longer and been deeper
than predicted and spilled over into local markets, and although we recorded
sales growth of 27% on a like for like basis, this growth was less than budgeted
and accordingly the loss for the year was greater than anticipated.

This is particularly disappointing because we have made excellent progress in
increasing our audience.  We now have more listeners than ever before and they
are listening for longer.

Results for the Year

The results show a loss for the year of £8.37m (2001: £4.93m) which includes a
full year's goodwill amortisation charge and the provision against the
investment in XY Networks Ltd. However the 'normalised' operating loss fell to
£2.14m (2001: £2.23m) on turnover of £3.8m (2001: £2.17m).  These results
reflect a full year's trading at all five stations; last year's results included
a full year only at Juice in Liverpool and Tower FM in Bolton, our stations in
Brighton, Wolverhampton and Chesterfield having been acquired in December 2000,
February 2001 and June 2001 respectively.  The basic loss per share was 38.9p
(2001: 26.2p) and the adjusted loss per share 10.6p (2001: 10.4p).  No dividend
is being recommended by the Board (2001: nil).

Operating Review


The RAJAR results for Quarter 3, 2002 confirm a continuing trend of improvement
since our five stations were first acquired.

                     Pre-Acquisition RAJAR Pre-Acquisition RAJAR    Quarter 3 2001       Quarter 3 2002
                                            Number of Listeners
                             Date                                       RAJAR                RAJAR

                                                                 Number of Listeners  Number of Listeners

  Juice Liverpool           Q3 1999               33,000                89,000              103,000
       Tower                Q2 2000               51,000                76,000               80,000
   Juice Brighton           Q3 2000               35,000                37,000               45,000
      The Wolf              Q4 2000               63,000                59,000               66,000
        Peak                Q2 2001               92,000                94,000              108,000
       Total                                      274,000              355,000              402,000

This growth in audience of 13% in twelve months is a significant achievement in
itself, but when considered alongside an increase in total hours listened of
35%, is exceptional.  Normally, when a radio station adds a large number of new
listeners, the average hours listened each week by the enlarged audience
reduces, because new listeners typically listen less than the established
audience.  However, our total hours have increased from 2.69m per week (average
per listener 7.6 hours - Q3 2001 RAJAR) to 3.63m per week (average per listener
9 hours - Q3 2002 RAJAR)).  Across the local commercial radio industry as a
whole, reach and total hours fell slightly between RAJAR Q3, 2001 and RAJAR Q3,


Trading conditions since January have been extremely difficult, with January and
April being particularly weak months.  Since April there has been a steady
growth in monthly revenues, with September being the best month of the year.
While our actual turnover growth of 27% combines an increase of 28% in local
advertising revenue and 20% in national advertising revenue, which we believe
will be substantially ahead of the UK commercial radio industry as a whole which
is not expected to show any growth in revenue year on year, this was
significantly below our expectations.


The difficult trading conditions experienced last year necessitated a detailed
review of operations which was completed before 30 September 2002.  A
combination of increased centralisation of our administrative functions,
economies of scale in programming as we developed consistent formats, salary
reductions by the Executive Directors, a general pay freeze, and a reduction in
discretionary expenditure enabled us to achieve savings against our overhead
budget for the year ended 30 September 2002 of £360,000 and we have reduced the
budget for fixed costs for the current financial year by a further £420,000 per
annum.  All our employees have contributed to these significant savings which
have been achieved without affecting the operational efficiency of the business.

We have renewed our overdraft facility of £3.5m for a further twelve month
period.  In addition, the Executive Directors and certain founder shareholders
have loaned the company £900,000 upon terms that were agreed by shareholders at
an Extraordinary General Meeting on 14 October 2002.

As announced on 14 August 2002 we have provided in full against our investment
in XY Networks Ltd, a company which was created to provide content and
technology services to WAP and 3G mobile telephone networks.  The availability
and take up of the hardware has been slower than expected and we have therefore
made full provision against this investment now.  Somethin' Else Sound
Directions Ltd, the parent company of XY, continues to develop its radio and
television independent production businesses.

During the year ended 30 September 2002 we renegotiated the terms of the
acquisition of our 10% interest in Somethin' Else Sound Directions Ltd, some of
the initial consideration for which was deferred.  £275,000 of the deferred
consideration, due to be paid on 30 April 2003, will not now be paid, and our
interest will reduce to 8%.  The carrying value of this investment on our
balance sheet, and creditors, have been reduced accordingly.

New Licence Win

In September 2002 the Radio Authority awarded the Worthing licence to the Splash
FM consortium in which we have a 35% stake.  Splash FM will start broadcasting
in April 2003.  We were disappointed that our Juice applications for Reading,
East Midlands and Oxford were unsuccessful, and we await the outcome of our
application for a new licence in Barnsley, which is expected to be determined in
January 2003.

Your Board

Maurice Dobson, a founder shareholder of Forever Broadcasting, retired from the
Board as Group Sales and Marketing Director in June 2002.  He made a significant
contribution to the establishment of the company and we wish him and his wife a
long and happy retirement.  He continues to be a substantial shareholder and a
contributor to the additional loans referred to under 'Finance'.

Tim Bleakley, a Non-Executive Director, resigned from the Board in December 2001
on leaving his employment in The Wireless Group plc.  We are grateful for his
contribution to the company also.

Harry Dunne was appointed to the Board as Sales Director following Maurice
Dobson's retirement.

Denis Cassidy and John Whitney, both Non-Executive Directors, have agreed to
serve for a  period of two years and will offer themselves for re-election at
the AGM to be held on 31st January 2003.

All of the Executive Directors were re-elected and Harry Dunne was elected at
the EGM held on 14th October 2002.


It has been an extremely difficult year for staff at all levels whose successful
efforts to increase audiences and revenues and bear the brunt of cost reductions
as well as contributing to a pay freeze have demonstrated both loyalty and
commitment.  I believe that shareholders will wish to join the Board in
acknowledging our appreciation of their support.

Strategic Review

The Board has released the following statement in a separate announcement this
morning: -

'Having concluded the strategic review announced in the circular to shareholders
dated 20th September 2002, the Board has decided to commence discussions with
potential investors.

The Board does not wish to speculate on how these discussions may develop
although, in the light of this decision, Mr Eric Lawrence (Managing Director),
having expressed a desire to explore the possibility of a management buy out of
part or all of the Group, has been granted leave of absence to enable him to do
so.  Mr Steve King (Programme Director) and Mr Harry Dunne (Sales and Marketing
Director) have indicated that, if successful, they wish to join a management buy
out team and, in the meantime, they will continue in their operational roles.
During Mr Lawrence's leave of absence, Mr Josephs (Chairman) will assume the day
to day management of the Group's operations.

Further announcements will be made as appropriate.'

Future Prospects

We have entered the new financial year further encouraged by the most recent
RAJAR results and with a forward order book substantially higher than a year
ago.  We have reduced costs and demonstrated our ability both to grow audiences
and to manage the business effectively.

The industry as a whole is facing uncertain conditions as a result of the
Communications Bill.  Most observers expect there to be some further
consolidation in the industry and we hope to benefit from this.

Your Board, supported by a talented and committed staff, will continue to work
to enhance shareholder value.

John Josephs
13 November 2002

Unaudited consolidated profit and loss account for the year ended 30 September

                                                       Note                       Unaudited      Unaudited

                                                                                       2002           2001

                                                                                      £'000          £'000

Turnover                                                                              3,802          2,172
Administrative and selling expenses
  Trading administrative and selling expenses                                       (6,328)        (4,932)
  Goodwill amortisation                                                             (3,709)        (2,439)
  Impairment of trade investment                                                    (2,000)              -
                                                                                   (12,037)        (7,371)
Operating loss                                                                      (8,235)        (5,199)
Interest receivable and similar income                                                    5            276
Interest payable and similar charges                                                  (145)            (8)
Loss on ordinary activities before taxation                                         (8,375)        (4,931)
Tax on loss on ordinary activities                                                        -              -
Loss for the financial year                                                         (8,375)        (4,931)
Loss per share - basic                                   1                            38.9p          26.2p
Adjusted loss per share                                  1                            10.6p          10.4p

All results relate entirely to continuing operations.

The group has no recognised gains or losses other than the loss above and
therefore no separate statement of total recognised gains and losses has been

There is no difference between loss on ordinary activities before taxation and
the loss for the financial year stated above and their historical cost

                                                                                    Unaudited     Unaudited

'Normalised' operating loss is calculated as follows:                                    2002          2001

                                                                                        £'000         £'000

Operating loss                                                                         (8,235)      (5,199)
Amortisation of goodwill                                                                 3,709        2,439
Restructuring costs                                                                        207          210
Licence application costs                                                                  183          284
Write-down in valuation of trade investments                                             2,000            -
Aborted deal costs                                                                           -           40

'Normalised' operating loss                                                            (2,136)      (2,226)

The 'normalised' operating loss represents the underlying performance of the
business before the amortisation of goodwill, restructuring costs, licence
application costs and the write down in the valuation of trade investments.

Unaudited balance sheets as at 30 September 2002
                                                                               Group             Group
                                                                           Unaudited        Unaudited

                                                                                2002             2001

                                                                               £'000            £'000
Fixed assets
Goodwill                                                                      13,367           17,130
Tangible assets                                                                  584              695
Investments                                                                      485            2,832
                                                                              14,436           20,657
Current assets
Debtors                                                                          965              965
Cash at bank and in hand                                                           -                -
                                                                                 965              965
Creditors: amounts falling due within
one year                                                                     (3,987)          (1,570)
Net current (liabilities)/assets                                             (3,022)            (605)
Total assets less current liabilities                                         11,414           20,052
Creditors: amounts falling due in more
than one year                                                                  (110)            (373)
Net assets                                                                    11,304           19,679

Capital and reserves
Called up equity share capital                                                10,759           10,759
Share premium account                                                         10,656           10,656
Other reserves                                                                 4,834            4,834
Profit and loss account                                                     (14,945)          (6,570)
Equity shareholders' funds                                                    11,304           19,679

Unaudited consolidated cash flow statement for the year ended 30 September 2002

                                                             Unaudited    Unaudited    Unaudited    Unaudited
                                                                  2002         2002         2001         2001

                                                                 £'000        £'000        £'000        £'000
Net cash outflow from operating activities                                  (2,230)                   (2,732)
Returns on investments and servicing of
Interest received                                                    5                       309
Interest paid                                                    (133)                      (14)

Net cash (outflow)/inflow from returns on
investment and servicing of finance
                                                                              (128)                       295

Taxation                                                                          -                         -
Capital expenditure and financial investment
Purchase of trade investments                                    (289)                   (1,316)
Purchase of tangible fixed assets                                (106)                     (295)
Sale of tangible fixed assets                                        -                         2

Net cash outflow from capital expenditure and
financial investment                                                          (395)                   (1,609)

Purchase of subsidiary undertakings                                 54                   (8,360)
Net overdraft acquired with subsidiaries                             -                      (88)

Net cash inflow/(outflow) from acquisitions                                      54                   (8,448)

Cash outflow before financing                                               (2,699)                  (12,494)
Net proceeds from issue of equity share                              -                       (4)
Capital element of finance lease repayments                       (34)                       (4)
Repayment of loan notes                                              -                     (256)
Increase in borrowings                                             399                         -
Repayment of loans and loan notes acquired
with subsidiaries                                                  (3)                     (156)
Net cash inflow/(outflow) from financing                                        362                     (420)
Decrease in net cash                                                        (2,337)                  (12,914)

1. Loss per share

The basic loss per 50p ordinary share has been calculated based on the loss
after taxation of £8,375,000 (2001: £4,931,000) and 21,519,225 (2001:
18,835,405) ordinary shares, being the weighted average number of ordinary
shares in issue during the period.

The adjusted loss per share has been calculated based on the adjusted loss after
taxation of £2,276,000 (2001: £1,958,000) and upon 21,519,225 (2001: 18,835,405)
ordinary shares, being the weighted average number of ordinary shares in issue.

The financial information set out above does not constitute financial statements
within the meaning of the Companies Act 1985.  The figures in the preliminary
announcement have been taken from the group's draft financial statements for the
year ended 30 September 2002, which will be finalised on the basis of the
financial information presented by the directors in this preliminary
announcement and will be delivered to the Registrar of Companies following the
Annual General Meeting.  The results for the year ended 30 September 2001 have
been extracted from the published accounts, which have been filed with the
Registrar of Companies, and on which the auditors gave an unqualified opinion.

The preliminary financial information has been prepared on the same basis as
accounting policies set out in the 2001 published accounts, as updated for the
introduction of FRS 19 'Deferred Taxation'.  The introduction of the standard
does not materially impact the Group.

Copies of the Company's Annual Report will be sent to shareholders in December
and will be available thereafter for members of the public at the Company's
registered office at 7 Diamond Court, Kingston Park, Newcastle Upon Tyne, NE3

The Annual General Meeting will be held on 31 January 2003 at 7 Diamond Court,
Kingston Park, Newcastle Upon Tyne, NE3 2EN.

                      This information is provided by RNS
            The company news service from the London Stock Exchange   D

FR BTBBTMMJBTIT                                                                                                                                                                                                                                             

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