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					INTERIM REPORT

2005

Directors and Advisers
Directors Selma Käppel Non-Executive Chairman Peter Urie Managing Director Elaine Edwards Finance Director Karl Homburg Non-Executive Director Secretary Elaine Edwards Registered and head office 33 Charlotte Street London W1T 1RR Registered number 3057905 Nominated adviser and nominated broker KBC Peel Hunt Ltd 111 Old Broad Street London EC2N 1PH www.metrodomegroup.com Registrars and transfer office Capita IRG plc The Registry 34 Beckenham Road Beckenham Kent BR3 4TU Bankers The Royal Bank of Scotland plc West End Commercial Centre 28 Cavendish Square London W1M 0DB Solicitors Bircham Dyson Bell 50 Broadway London SW1H 0BL

Chairman’s Statement
Financial highlights (compared to unaudited six months ended 30 June 2004) q Turnover at £1,660,000 was 31% down on the 6 months to 30 June 2004. April 2004 saw the release of Metrodome's biggest ever theatrical hit: Monster q Gross Margin % a very healthy 42.6% compared to 34.5% in 2004 mainly due to a very lucrative back catalogue deal q Overheads increased by 8% over 2004 due to employment of general managers in both theatrical and DVD departments, higher occupancy costs, increased business travel and additional audit and tax fees q Operating loss before tax and interest was £154,000 q Operational cashflow was -£763,000 (2004: +£136,000), due to six theatrical releases in the half and acquisition of a full slate of product for the second half q Loss before tax of £206,000 compared to a profit of £17,000 The highlights of the half were: q the theatrical release of The Assassination of Richard Nixon grossed £560,000 at the box office q the continued success of the Retro kids label accounting for 15% of the DVD sales in the half q The Corporation was released in March shipping 9,000 units q Budget and back catalogue DVD sales also did well The issues in the half were: q poor box office industry-wide especially for indie titles q continued squeeze on DVD prices Group operating results Metrodome had always planned to make a loss in the first half of the year as it released six films theatrically at an average 10% margin. The profit was always forecast to come in the second half when the titles could be sold to television and the DVD releases both rental and sell-through would be available. £240,000 of television sales were made but contracts were not signed until July hence they will show in second half numbers. On the DVD side the first half saw the launch of the Chronicle historical series with Napoleon; Julius Caesar and Wagner released in the half and a concentration on releasing higher priced box sets such as Nick Broomfield – Documenting Icons, Carlos Saura box set and Masters of Jazz. The set-up costs of these boxsets are high but should sell for many years.

Turnover Sales at £1,660,000 were 31% down against the comparable period last year.
Six monthsSix months ended ended 30 June 30 June 2005 2004 £000 £000

Variance %

Theatrical Non Theatrical Television Rental DVD Sell-through VHS Sell-through Other

231 12 34 103 1,248 32 — 1,660

737 135 108 1,350 95 — 2,425

(69) 100 (75) (5) (8) (67) — (31)

Metrodome Group plc

Chairman’s Statement
The theatrical market in the first half has been difficult. The independent sector has suffered to a greater extent than the studios. Some Indie sites have opted to show studio product rather than traditional Indie/foreign language titles. Metrodome has achieved steady box office performance, the highlight being The Assassination of Richard Nixon with a box office of £560,000 which supported a strong DVD ship-out in excess of 27,000 units in September 2005. Comparisons to 2004 are especially marked as last year Metrodome had its biggest ever theatrical hit Monster with a box office of £2.6million. Television sales in the half are low as £240,000 of sales were made but final contracts were only signed in July. Rental sales have continued as last year. On DVD sales fell by 8% as fewer titles were released as the business concentrated on higher value boxsets. These boxsets are taking longer to establish themselves than expected but will have a much longer life than the many Orchid label titles released last year. Unit prices in the marketplace have been coming down sharply and the length of time before a title has to be campaigned is becoming shorter both impacting turnover. Metrodome has continued to see success with its Kids retro label especially My Little Pony and Transformers. The new label Chronicle has started strongly with the 3 disc boxset of Napoleon selling 5,000 units to date. June saw the first release under our exclusive sales and distribution contract with cult film label Second Sight. The DVD team are actively looking to take on more of these contracts.

Gross margin The margin in the half is a very healthy at 42.6%. This is due to 2 major issues:
q

a large back catalogue sale at 100% margin provision taken last year for the margin impact of significant Monster returns in January this year

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Without these abnormal margin adjustments the margin would have been 33% which is in line with the 34% achieved last year. Administrative costs Costs in the half have increased by 8% year on year due to the following:
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improved calibre staff and the introduction of a General Manager in both Theatrical and DVD marginally higher occupancy and increased insurance costs increased business travel costs as more staff are travelling to markets additional professional fees for 2003 tax and audit

q

q

q

Again the above costs had all been allowed for in the 2005 budget.

Review of continuing operations Metrodome has a strong slate of product for the second half of 2005.

Chairman’s Statement
Theatrical titles:
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Overnight (July) Dear Wendy (August) The Mighty Celt (August) Daybreak (September) Rag Tale (October) Mad Hot Ballroom (November) (Joint Venture with Paramount Classics)

q

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In striving for operational efficiencies, we have struck a new two year deal with our distributors Deluxe in August on the same terms as the last two years. DVD manufacturing prices are always under review due to the changing nature of the business. Andrew Keyte resigned in August 2005 to return to the television sector whence he came: I would like to take this opportunity to thank Andrew Keyte for all his efforts in the success of Metrodome over the last two years. I am pleased to announce that Peter Urie has replaced Andrew Keyte as the Managing Director of Metrodome Group plc. Peter brings with him a wealth of experience especially in the television sector. He worked for the BBC for 12 years before co-founding TSS Ltd and Media Merchants Ltd who became some of the largest independent producers of children's programmes in the UK. The two companies were ultimately sold onto HIT Entertainment PLC where Peter continued to work as Vice President Group Head of Production until early 2005. I would also like to wish Peter Urie every success in his new role.

q

q

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Several properties are also now acquired for the first half of 2006 including Pretty Persuasions and Shooting Dogs (a joint venture with the BBC). DVD retail titles: major releases:
q

Somersault (August) The Assassination of Richard Nixon Transformers The Movie Transformers Takara Overnight (September) First releases on new UMD format Evil My Little Pony Budget release of Monster (October) Nick Broomfield singles Hearts and Minds (November) Dear Wendy (December)

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q q

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Selma Käppel Chairman 18 September 2005

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Metrodome Group plc

Consolidated Profit and Loss Account
Six months ended 30 June 2005
Six months ended 30 June 2005 (Unaudited) £000 Six months ended 30 June 2004 (Unaudited) £000 Year ended 31 December 2004 (Audited) £000

Turnover Continuing Discontinued Cost of sales Continuing Discontinued Gross profit Administrative expenses Continuing Discontinued Exceptional administrative expenses Continuing Discontinued Operating (loss)/profit Loss on closure of discontinued businesses Discontinued — — 57 (40) 17 — 17 17 — 337 (93) 244 — 244 244 — — (154) (9.28%) — 15 57 2.36% (28) 15 337 (861) — (794) — (1,475) — (953) — 707 42.57% (1,589) — 836 34.47% (3,858) — 1,825 32.11% 1,660 — 2,425 — 5,683 —

(Loss)/profit on ordinary activities before interest (154) Interest payable (Loss)/profit before taxation Taxation (Loss)/profit after taxation (Loss)/profit transferred to reserves (52) (206) — (206) (206)

Earnings per share Basic Diluted (0.3)p (0.3)p 0.0p 0.0p 0.3p 0.3p

Consolidated Balance Sheet
At 30 June 2005
30 June 2005 (Unaudited) £000 30 June 2004 (Unaudited) £000 31 December 2004 (Audited) £000

Fixed assets Intangible assets Tangible assets 25 62 87 Current assets Stock Debtors – due within one year – due after one year Cash at bank and in hand 4,739 1,783 — — 6,522 Creditors Amounts falling due within one year Net current assets Total assets less current liabilities Creditors Amounts falling due after more than one year Net assets — 2,214 — 2,193 — 2,420 (4,395) 2,127 2,214 (4,485) 2,110 2,193 (4,311) 2,336 2,420 4,200 2,255 140 — 6,595 4,242 2,302 55 48 6,647 26 57 83 25 59 84

Capital and reserves Called up share capital Share premium account Profit and loss account Shareholders’ funds (equity interests) 2,631 5,128 (5,545) 2,214 2,631 5,128 (5,566) 2,193 2,631 5,128 (5,339) 2,420

Metrodome Group plc

Consolidated Cash Flow Statement
Six months ended 30 June 2005
Six months ended 30 June 2005 (Unaudited) £000 Six months ended 30 June 2004 (Unaudited) £000 Year ended 31 December 2004 (Audited) £000

Net cash (outflow)/inflow from operating activities Returns on investment and servicing of finance Interest paid Capital expenditure and financial investment Purchase of tangible fixed assets Cash (outflow)/inflow before use of liquid resources and financing Financing Issue of ordinary share capital Capital element of hire purchase payments — — — (Decrease)/increase in cash for the period (832) — — — 75 — — — 721 (832) 75 721 (17) (21) (38) (52) (40) (93) (763) 136 852

Reconciliation of net cash flow to movement in net debt (Decrease)/increase in cash for the period Cash outflow from decrease in hire purchase obligations Movement in net debt Net debt at start of period Net debt at 30 June 2005 — (832) 48 (784) — 75 (673) (598) — 721 (673) 48 (832) 75 721

Notes to the Accounts
1. Preparation of the accounts The unaudited results for the six months ended 30 June 2005 have been prepared on the basis of the accounting policies set out in the audited accounts of the Group for the year ended 31 December 2004. The financial information contained in this interim report does not constitute statutory accounts within the meaning of Section 240 of the Companies Act 1985. Statutory accounts for the year ended 31 December 2004, upon which the auditors gave an unqualified opinion, have been delivered to the Registrar of Companies. 2. Profit/(loss) per share The loss (2004: profit) per share is based on the consolidated loss of £206,000 (2004: profit £17,000) after taxation and minority interests and the weighted average number of shares in issue in the period of 71,309,543 (30 June 2004: 71,309,543). 3. Dividends As in prior periods the Directors are not recommending payment of a dividend. 4. Net cash flows from operating activities
Six months ended 30 June 2005 (Unaudited) £000 Six months ended 30 June 2004 (Unaudited) £000 Year ended 31 December 2004 (Audited) £000

Cash outflow from operating activities Operating (loss)/profit Depreciation on tangible fixed assets Loss on disposal of tangible fixed assets Amortisation of intangible fixed assets (Increase)/decrease in stocks Decrease/(increase) in debtors (Decrease)/increase in creditors Net cash (outflow)/inflow from operating activities (763) 136 852 (154) 14 — — (497) 574 (700) 57 17 — — (279) (245) 586 337 31 — 2 (321) (207) 1,010

Metrodome Group plc

Notes to the Accounts
5. Net debt
As at 30 June 2005 (Unaudited) £000 As at 30 June 2004 (Unaudited) £000 As at 31 December 2004 (Audited) £000

Net debt at 30 June 2005 is made up as follows: Bank overdrafts Net debt at 30 June 2005 (784) (784) (598) (598) 48 48


				
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