TIDMBOOM
RNS Number : 7583B
Boomerang Plus PLC
24 February 2011
Date: 24 February 2011
On behalf of: Boomerang Plus plc ('Boomerang', 'the Company', or
'the Group')
Embargoed until: 0700hrs
Boomerang Plus plc
Interim Results
Boomerang Plus plc (AIM: BOOM.L), a profitable and vertically
integrated, multi-genre, independent television production group,
today announces its unaudited results for the six months ended 30
November 2010.
Financial Highlights
-- Turnover increased by 84% to GBP16.29 million (2009: GBP8.87
million)
-- Gross profit margin of 15.2% (year to May 2010: 16.3%)
-- Operating profit increased 74% to GBP0.86 million (2009:
GBP0.49 million)
-- Cash and cash equivalents of GBP3.76 million (2009: GBP2.82
million)
-- Basic earnings per share increased by 69% to 6.21p
(2009:3.67p)
Operational Highlights
-- Good progress on diversification strategy:
- Successful integration of Indus Films (acquired October
2009)
- Organic Network success
- Continued growth in advertiser funded programming ('AFP')
-- 659 hours of programming for calendar year 2010 (2009: 428
hours)
-- Continued critical acclaim for the Group's programmes
Outlook
-- Full year revenues and profits expected to be considerably
first half weighted
-- Strong visibility over future revenues and commissions
-- Increase in Network productions
-- Current trading in line with the Board's expectations
-- Continue to examine acquisition opportunities
Huw Eurig Davies, Chief Executive Officer of Boomerang Plus,
commented:
"These interim results demonstrate the Group's continued
progress in diversifying its operations. We have made successful
inroads with Network broadcasters and seen further strong growth in
our AFP business. With good visibility over future revenues and
commissions, together with a strong balance sheet, the Group is
very well placed to exploit the considerable opportunities
presented by a fast-changing media marketplace"
- Ends -
For further information, please contact:
Boomerang Plus plc Via Redleaf Communications
Huw Eurig Davies, Chief Executive
Mark Fenwick, Finance Director
Redleaf Communications 020 7566 6700
Anna Dunkin/Rebecca Sanders-Hewett boomerang@redleafpr.com
Altium Capital
Tim Richardson/Melanie Szalkiewicz 020 7484 4040
Boomerang Plus
-- Boomerang, founded in 1994, has extensive experience in
producing content in a variety of genres, including entertainment,
factual, sport, music, drama, and children's programming for
television, radio and the web.
-- The Group operates across the whole spectrum of creative
industry activities including content production, post-production
services, television facilities, and talent management.
-- Boomerang aims to be independent television production
company of choice to the Network broadcasters looking to fill their
Ofcom quotas from the 'Nations and Regions' (broadcasters must
source between 10% and 50% of qualifying programme hours from
outside the M25 boundary).
-- Boomerang is ranked in the top five independent television
production companies, by revenue, in the Nations and Regions
according to the Broadcast Survey 2010.
-- Boomerang's strategy is to continue to produce high quality
content across a breadth of genres and to become a leading producer
of AFP and digital content and services. The Group also aims to
achieve strong organic growth by leveraging its existing customer
base and making strategic acquisitions, with a view to becoming a
major supplier to UK networks looking to satisfy their Nations and
Regions quotas.
Chief Executive's Statement
I am pleased to present the Group's results for the six months
ended 30 November 2010 (the 'period').
Overview
This has been a period of continued progress by the Group. Our
strategy of diversifying the Group's operations and, in particular,
investing in IP strong businesses with global footprints, has
contributed to a period of strong growth in revenue and
profitability. The period under review has also benefited from a
number of the Group's projects being delayed in the previous
year.
The period includes a full six months trading from Indus Films
(acquired in October 2009) and the other businesses we acquired in
the first half of last year. The addition of Indus to the Group has
brought the world renowned and award winning expertise of the
producers of "Amazon" and "Arctic" (with Bruce Parry), "Living with
Monkeys", "Coal House" and "Snowdonia 1890".
We also experienced strong growth in our Advertiser Funded
Programming ('AFP') business and made significant organic inroads
into Network broadcasters. We are among the market leaders in AFP
and continue to see growth and opportunities with a broad range of
UK and global clients such as Red Bull, Nissan, Sony Playstation,
Sony Ericsson and Quiksilver. Changes to product placement rules,
pressure on programming budgets and widening distribution platforms
are providing a strong base for growth, which our talented team are
well placed to exploit.
Financial Review
As highlighted above, the impact of acquisitions and delayed
commissions from 2009/10 has helped revenues for the period
increase by 83.8 per cent to GBP16.29 million (2009: GBP8.87
million). Overall gross profit margins in the period reduced to
15.2 per cent (six months to 30 November 2009: 19.1 per cent; 12
months to 31 May 2010 16.3 per cent) due to a higher proportion of
lower margin drama and children's production.
As a result, operating profit was up 74 per cent to GBP0.86
million (2009: GBP0.49 million) and profit before tax was up 67.7
per cent to GBP0.79 million (2009: GBP0.47 million).
Basic earnings per share for the period were up 69.2 per cent to
6.21 pence (2009: 3.67 pence).
As at 30 November 2010, the Group had cash and cash equivalents
of GBP3.76 million (2009: GBP2.82 million) after outflows for
acquisitions, including deferred consideration payments in respect
of acquisitions in prior periods, of GBP0.21 million (2009: GBP1.22
million), the purchase of fixed assets of GBP0.39 million (2009:
GBP0.58 million), and debt repayments of GBP0.29 million (2009:
GBP0.16 million) during the period. Net assets at 30 November 2010
were GBP9.5 million (2009: GBP8.9 million).
Programming
The Group's content production businesses: Boomerang, Indus,
Fflic, Alfresco and Apollo, contributed towards a strong,
multi-genre portfolio of programmes for our broadcast customers
during the period.
We have had noted success in increasing our organic Network
presence during the period. For Channel 4, we are currently in
production of "The Secret Supper Club", a ten part food and wine
series with Olly Smith, and the second series of "That Paralympic
Show", a multi-platform magazine series introducing the London 2012
Paralympics.
In AFP, highlights included our first 3D commission to produce a
Skateboard Documentary with legendary American Skateboarder, Tony
Hawk. Filming for Quiksilver's Tony Hawk's European Tour wrapped in
July 2010 following a three-week tour across Berlin, Rome,
Barcelona and Brighton. Other AFP productions during the period
included Roxy Jam Biarritz, the annual Women's World Longboard
Championships; the third series of Sony Ericsson World B-boy
Championships, the global search for the best breakdancing crew in
the world, filmed on location in New York, Japan, Korea, Europe and
concluding in Brixton for the competition final; and Sony
Playstation GT Academy, the virtual-to-reality motor racing
competition once again hosted by F1 luminaries Eddie Jordan and
Johnny Herbert and filmed across Australia, New Zealand, Europe and
the UK. This organic growth has been complemented through continued
investment into the "Freeze" winter sports and music festival and
the acquisition last year of "Method", the multimedia snowboarding
publisher.
Complementing this organic success, Indus has been extremely
busy during the period on a raft of commissions including "Arctic"
(with Bruce Parry) and "Snowdonia 1890".
We have again produced a range of multi-genre programming for
S4C during the period. These include the "Stwnsh" and "Cyw"
children's services; drama series "Teulu" and "Alys"; factual
entertainment series "3 Lle", "Gwlad Beirdd", "Cartrefi Cefn Gwlad
Cymru" and "Cyfnewid"; music series "Bandit" and "Nodyn"; youth
series "Gofod;" and sports series "Chwa", "Rasus" and "Ras i
Lundain" amongst others.
Post-production and Facilities
The Group continued to invest during the period in expanding its
post-production, camera, studio and outside broadcast facilities.
The Group currently operates approximately 70 edit suites, four
pro-tools dub suites and four studios together with an outside
broadcast truck. Our editing facilities now include a Baselight
grading system, two DS Nitris systems and two Symphony Nitris
systems.
Digital media
With our digital media partner, Cube Interactive, we continue to
explore and develop opportunities in digital media, including
websites, web streaming and interactive media. This includes
content creation for the "Royal Welsh", "Stwnsh" and "Cyw"
contracts whilst multi-platform distribution is also at the
forefront of most of our AFP content.
Radio
The Group continues to supply a diverse range of radio
programmes, particularly for BBC Radio Wales, Radio Cymru and Radio
4.
Talent management
Boom Talent, a management company representing singers, actors
and presenters in film, television, theatre, radio, corporate and
voice-over work, continues to establish itself.
Outlook
As previously highlighted, following the Government's
Comprehensive Spending Review in October 2010, S4C will have a
reduced programming budget in the future and this will inevitably
impact production companies based in Wales. However, the Board
believes that the Group's position as one of the largest
multi-genre Nations and Regions production companies in the UK and
accelerating diversification will allow it to mitigate the impact
of S4C's changed circumstances and will bring considerable benefits
to the Company over the coming years as the increased Ofcom quota
requirements for broadcasters come in to force.
Organic Network growth, the acquisition of Indus and growth in
AFP programming have all contributed to diversifying the Group's
customer base and widening its intellectual product base. This will
continue to drive further growth in an increasingly global market
and provide us with opportunities to increase our profit
margins.
Our success in securing new contracts and our track record on
recommissions provide the Group with good visibility over revenues
for the second half of the current financial year and the first
half of 2011/12. Full year results are expected to be considerably
first half weighted and current trading is in line with the Board's
expectations.
We will also continue to look for further acquisitions that can
add value for shareholders in a fast-changing media
marketplace.
Huw Eurig Davies
Chief Executive
23 February 2011
Condensed Consolidated Income Statement
Six months ended 30 November 2010 (unaudited)
Six months Six months
ended 30 ended 30 Year ended
November November 31 May
Note 2010 2009 2010
GBP'000 GBP'000 GBP'000
Revenue 16,295 8,866 21,409
Cost of sales (13,811) (7,176) (17,912)
Gross profit 2,484 1,690 3,497
Administrative expenses
Other administrative expenses (1,631) (1,320) (2,928)
Professional fees in relation to
unsuccessful corporate
transactions (10) - (73)
Provision for impairment of
investments - - (70)
Amortisation of intangibles
arising on business acquisitions (10) (6) (20)
Equity settled share based
payments - (4) (7)
Total administrative expenses (1,651) (1,330) (3,098)
Other operating income 37 112 227
Loss on disposal of fixed assets - (3) -
Share of results of joint ventures
and associates (12) 24 (18)
Operating profit 858 493 608
Investment income 3 - 3
Finance costs (73) (23) (76)
Profit before tax 788 470 535
Tax on profit on ordinary
activities 2 (234) (143) (218)
Profit for the period 554 327 317
Earnings per share 3
Basic 6.21p 3.67p 3.56p
Diluted 6.13p 3.60p 3.50p
Adjusted - basic 6.44p 3.78p 5.47p
Adjusted - diluted 6.35p 3.71p 5.38p
All activities derive from continuing operations.
The Group has no other items of comprehensive income and as such
has not presented a separate condensed consolidated statement of
comprehensive income.
Condensed Consolidated Balance Sheet
As at 30 November 2010 (unaudited)
30 30 31
November November May
2010 2009 2010
GBP'000 GBP'000 GBP'000
NON-CURRENT ASSETS
Goodwill 3,039 2,102 3,049
Other intangible assets 2,430 3,802 2,444
Property, plant and equipment 3,401 1,613 2,931
Investments 360 496 371
9,230 8,013 8,795
CURRENT ASSETS
Inventories - - 9
Trade and other receivables 3,461 3,423 4,158
Current tax assets 219 219 219
Cash and cash equivalents 3,761 2,818 3,070
7,441 6,460 7,456
TOTAL ASSETS 16,671 14,473 16,251
CURRENT LIABILITIES
Trade and other payables 4,256 2,945 4,615
Current tax liabilities 374 595 84
Interest-bearing loans and borrowings 735 250 492
Deferred consideration 109 268 333
5,474 4,058 5,524
NON-CURRENT LIABILITIES
Interest-bearing loans and borrowings 634 90 742
Other payables 76 14 47
Deferred tax liabilities 219 109 232
Deferred consideration 734 1,212 722
1,663 1,425 1,743
TOTAL LIABILITIES 7,137 5,483 7,267
NET ASSETS 9,534 8,990 8,984
Condensed Consolidated Balance Sheet
As at 30 November 2010 (unaudited)
30 30 31
November November May
2010 2009 2010
GBP'000 GBP'000 GBP'000
EQUITY
Share capital 89 89 89
Share premium account 3,934 3,933 3,934
Merger reserve 1,217 1,217 1,217
Retained earnings 4,294 3,751 3,744
Equity attributable to equity holders
of the parent 9,534 8,990 8,984
These condensed consolidated interim statements were approved by
the Board of Directors on 23 February 2011.
Signed on behalf of the Board of Directors
H E Davies M W Fenwick
Director Director
Condensed Consolidated Cash Flow Statement
Six months ended 30 November 2010 (unaudited)
Six
Six months months
ended 30 ended 30
November November Year ended 31 May
Note 2010 2009 2010
NET CASH INFLOW FROM
OPERATING ACTIVITIES 4 1,473 1,745 2,615
INVESTING ACTIVITIES
Interest received 3 - 3
Purchase of property, plant
and equipment (393) (97) (544)
Acquisition of subsidiaries
- net cash outflow arising
on acquisition - (768) (768)
Acquisition of subsidiaries -
deferred consideration
payments (211) (128) (326)
Acquisition of associates - (326) (209)
Acquisition of intangible
fixed assets - (480) (458)
Proceeds on disposal of
property, plant and
equipment 7 - 1
NET CASH USED IN INVESTING
ACTIVITIES (594) (1,799) (2,301)
FINANCING ACTIVITIES
Repayments of obligations
under finance leases (288) (155) (372)
Proceeds on issue of shares - - 1
Grants received 100 - 100
NET CASH USED IN FINANCING
ACTIVITIES (188) (155) (271)
NET INCREASE/(DECREASE) IN
CASH AND CASH EQUIVALENTS 691 (209) 43
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 3,070 3,027 3,027
CASH AND CASH EQUIVALENTS AT
END OF PERIOD 3,761 2,818 3,070
Condensed Consolidated Statement of Changes in Equity
Six months ended 30 November 2010 (unaudited)
Share
Share premium Merger Retained
capital account reserve earnings Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1 June
2009 89 3,933 1,217 3,420 8,659
Profit for the financial
period - - - 327 327
Equity-settled
share-based payments - - - 4 4
Balance at 30 November
2009 89 3,933 1,217 3,751 8,990
Loss for the financial
period - - - (10) (10)
New shares issued - 1 - - 1
Equity-settled
share-based payments - - - 3 3
Balance at 31 May
2010 89 3,934 1,217 3,744 8,984
Profit for the financial
period - - - 554 554
Foreign exchange - - - (4) (4)
Balance at 30 November
2010 89 3,934 1,217 4,294 9,534
The Group has taken advantage of section 612 of the Companies
Act 2006 and so the excess over the nominal value of shares issued
other than for cash has been allocated to the merger reserve.
1. BASIS OF PREPARATION AND ACCOUNTING
The interim financial information does not constitute statutory
accounts for the purpose of section 434 of the Companies Act 2006.
The figures for the year ended 31 May 2010 have been extracted from
the Group's audited accounts for that year. Those accounts have
been reported on by the Group's auditors and delivered to the
Registrar of Companies. The report of the auditors was (i)
unqualified, (ii) did not include a reference to any matters to
which the auditors drew attention by way of emphasis without
qualifying their report, and (iii) did not contain a statement
under section 498 (2) or (3) of the Companies Act 2006.
The interim financial information for the six months ended 30
November 2010 and 30 November 2009 has not been audited or reviewed
by the auditors. The interim results have been prepared using the
same accounting policies and estimation techniques that are
expected to apply at the year-end and is consistent with the
accounting policies disclosed in the Group's annual report for the
year ended 31 May 2010.
2. tax
Taxation for the six-month period is charged at the best
estimate of the average annual effective income tax rate expected
for the full year, applied to the pre-tax income of the six-month
period.
31
30 November 30 November May
2010 2009 2010
GBP'000 GBP'000 GBP'000
UK taxation at standard rate 275 155 103
Deferred taxation (41) (12) 115
234 143 218
3. earnings per share
31
30 November 30 November May
2010 2009 2010
Earnings GBP'000 GBP'000 GBP'000
Profit for the period 554 327 317
Professional fees in relation to
unsuccessful corporate transactions 10 - 73
Amortisation of intangibles arising on
business acquisitions 10 6 20
Provision for impairment of investments - - 70
Equity settled share based payments - 4 7
Adjusted profit 574 337 487
Number of shares No. No. No.
Weighted average number of
ordinary shares 8,914,731 8,911,231 8,911,902
Dilutive weighted average
number of shares 9,036,676 9,079,154 9,065,700
Earnings per ordinary share - 6.21p 3.67p 3.56p
basic
Earnings per ordinary share - 6.13p 3.60p 3.50p
diluted
Adjusted earnings per share - 6.44p 3.78p 5.47p
basic
Adjusted earnings per share - 6.35p 3.71p 5.38p
diluted
4. notes to the condensed consolidated cash flow statement
31
30 November 30 November May
2010 2009 2010
GBP'000 GBP'000 GBP'000
Profit from operations 858 493 608
Adjustment for:
Amortisation of intangible fixed assets 29 27 61
Depreciation of property, plant and
equipment 339 207 446
Profit on property, plant and equipment
disposals - 4 2
Government grants (33) (60) (117)
Results of joint ventures and associates 12 (24) 20
Provision for impairment of investment - - 70
Foreign exchange (9) - -
Equity-settled share-based payments - 4 7
Operating cash flows before movement in
working capital 1,196 651 1,097
Decrease/(increase) in receivables 724 640 (79)
(Decrease)/increase in payables (397) 457 2,109
Increase/(decrease) in inventory 9 - (9)
Cash generated from operations 1,532 1,748 3,118
Income taxes received/(paid) 14 20 (451)
Interest paid (73) (23) (52)
Net cash inflow from operating
activities 1,473 1,745 2,615
5. AVAILABILITY OF INTERIM RESULTS
A copy of the interim report will be available for members of
the public by application to the Company's Registered Office or on
the Company's website at www.boomerang.co.uk.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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