TIDMLUD
RNS Number : 8243K
Ludorum PLC
27 April 2010
26 April 2010
LUDORUM PLC PRELIMINARY RESULTS FOR THE YEAR ENDED 31 DECEMBER 2009
Ludorum plc, the AIM-listed media investment company, today announces its
results for the year ended 31 December 2009.
Highlights
* Revenue generated in the year increased by GBP1.97m to GBP2.14m (2008:
GBP0.17m) Operating loss for the year fell by 29% to GBP1.69m (2008: GBP2.39m)
* Chuggington has now been licensed for broadcast in over 175 countries with
significant ratings success in most initial broadcast markets including the UK,
Germany, Australia, Canada and France
* A multi-rights agreement was signed in April 2009 with Fuji Networks in Japan
with satellite broadcast commencing in July 2009
* Broadcast agreement reached with The Disney Channel in the USA in June 2009
with first broadcast on 18 January 2010
* Over 125 consumer products and home entertainment licence agreements have been
concluded throughout the world.
* Fifty-two 10 minute episodes completed; agreement entered into in February
2009 to produce a further 52 X 10 minute episodes which have been pre-sold to
the BBC, Super RTL, TF1 and ABC Australia
* Strong publishing and DVD sales have begun in the UK and Australia
Rob Lawes, Chief Executive Officer said:
"We are very pleased and excited with the progress made in 2009. We have created
a pre-school property in Chuggington that has demonstrated appeal to children
and their parents on a global basis. We believe that Chuggington is now well
positioned in the marketplace and is starting to deliver real growth and value
for our shareholders."
Chief Executive's Review
Overview
Ludorum plc is an AIM-listed media investment company. The Group is focused on
creating or acquiring and subsequently exploiting the rights for children's
entertainment properties through both conventional media and new media channels.
Throughout 2009 the Group has continued to make substantial progress with
securing broadcast in nearly all major markets worldwide. Building on the
successful broadcast placement of Chuggington we have been active in concluding
key home entertainment, consumer products, publishing and agency agreements to
help to support and maximise the popularity of Chuggington.
This is the first year in which we see tangible financial results from our
investment in Chuggington with revenues for the period increasing by GBP1.97m to
GBP2.14m. We are greatly encouraged by Chuggington's early success. We will
continue to develop and exploit the property throughout the world, and have
confidence that our first property will create material long-term value for our
shareholders.
Chuggington
Chuggington is a computer generated series of 104 x 10 minute episodes, 52
shorter mini-episodes and a fully immersive interactive website. The website, 52
episodes and 26 mini-episodes are complete, and the others are currently in
production. The series follows the adventures of Wilson, Brewster and Koko, all
trainee engines and each with their own unique personality and learning style.
The series is set in a world much like our own with cities, villages and diverse
cultures and geography. Entertainment and enjoyment is at the heart of
Chuggington, but embedded within each story are important educational and
developmental messages centred on learning and social-emotional development. The
series offers an extensive range of destinations to explore and adventures
through which children and parents can benefit from the underlying value of
positive life-learning lessons.
Broadcast
We have concluded broadcast agreements with leading broadcasters in their
respective territories for broadcast into 175 countries. During the year we
concluded two significant agreements: one with Disney Channel in North America,
where we created an American voiced version of Chuggington for broadcast in
January 2010, and the second an agreement with Fuji Networks in Japan (their
first western pre-school programming acquisition in more than 15 years) where
satellite broadcast commenced in July 2009. In addition to major terrestrial
broadcasters in key territories, we have also concluded agreements with Disney
channels in Latin America, the Far East, Italy and Scandinavia.
Chuggington launched on Cbeebies channel in the UK in January 2009 and has
established a consistent status as one of the top rating shows on the
channel. The series has also been launched in a number of key international
markets and has also enjoyed strong ratings. The property is scheduled to launch
in other key territories around the world during 2010.
Consumer Products, Home Entertainment and Publishing
Learning Curve Brands, Inc ("Learning Curve"), a division of RC2 and a leading
global toy manufacturer based in the US, has been granted the master toy licence
for Chuggington on a worldwide basis. Learning Curve has developed a substantial
line of new and innovative toys. Learning Curve has recently reported that
their product lines have been well received at the Hong Kong, United Kingdom,
Nuremberg and New York toy fairs that took place in early 2010. First products
have started to roll-out in Spring 2010 and preliminary sales data in the UK,
Australia and Germany has been very encouraging. Learning Curve contributes to
the animated production costs and will participate in the net profits of the
property.
In addition to the Learning Curve master toy licence, the Company has entered
into a significant number of consumer products agreements with leading
organisations, including Scholastic Publishing, Tomy, and VTech. For example,
in the UK, there are now a total of 29 licence agreements in place covering a
broad range of product categories including clothing, bedding, games and
puzzles, bicycles, celebration cakes and greetings cards. Product under these
arrangements will also start to roll-out in early 2010.
The Group has concluded a number of agreements with leading home entertainment
partners in key territories. These include 2entertain (UK), Universal Pictures
(Germany), TF1 Vision (France), Fuji Group (Japan), Roadshow (Australia) and
Daewon in Korea. In the UK Chuggington was the strongest performing "new
entrant" into the pre-school market having the fourth best selling DVD in the
pre-school genre for the year and all three DVD releases being in the top twenty
of all titles released in 2009. As in the UK, DVDs in Australia also performed
strongly.
Parragon are the master publisher of Chuggington books in several key markets
including the UK, Australia, Germany, Scandinavia and Benelux and the Company is
committed to producing a very broad range of high quality books across all
categories. Parragon introduced 7 titles in the UK and Australia and enjoyed
very strong sell through in both markets. In November 2009 the Company concluded
a publishing agreement with Scholastic Inc for North American publishing rights.
First titles will be released in autumn 2010.
Production
The first series of 52 episodes was fully completed in January 2009. In February
2009 the Company entered into a new agreement with its production partner in
Shanghai to produce a further 26 episodes which will be delivered in July 2010
and the Company has commissioned a further 26 episodes which will be delivered
in summer 2011. The second series has been pre-sold to the BBC, Super RTL, TF1
and ABC Australia.
Financial Review
Ludorum generated revenues of GBP2.14m for the full year (2008: GBP0.17m). The
first six months of 2009 generated revenues of GBP0.94m and the second half of
the year had revenues of GBP1.20m, a 28% increase over the prior six months.
Broadcast revenues in the first six months were GBP0.8m and consumer products
revenues were GBP0.14m. The second half of the year had broadcast revenues of
GBP0.56m and consumer products revenues of GBP0.64m. Strong DVD and publishing
royalties drove the second half increase in consumer products income.
Gross profit increased from GBP0.04m to GBP1.15m for the full year. The gross
profit for the first six months of 2009 was GBP0.34m and the second half gross
profit was GBP0.81m.
Total administrative costs, excluding costs attributed to share schemes, were
GBP2.43m, a 21% increase of GBP0.43m over the year to 31 December 2008. Staff
costs increased by GBP0.27m. Average staff numbers for the year increased from
10 in 2008 to 15 in 2009. Advertising and marketing expenditure increased by
GBP0.1m. An additional GBP0.28m was incurred on professional fees and
depreciation of office equipment increased by GBP0.21m.
The operating loss for the full year fell by 29% to GBP1.69m (2008: GBP2.39m).
Capital expenditure on Chuggington during the year was GBP0.75m, compared with
GBP0.99m in 2008. Series 1 of the programme was completed in early 2009 and,
following a short interval, production commenced on Series 2 of the programme.
Expenditure on tangible assets increased to GBP0.81m in 2009 compared with
GBP0.16m in 2008. This is mainly accounted for by the Company's change of
premises.
In the year the Company utilised a GBP1.2m fixed interest bank loan facility and
started to repay back the loan towards the end of the year. Total repayment of
the loan by the end of the year was GBP0.07m. Additional cash was also raised by
a placing of 324,000 ordinary shares at a price of GBP1.40 per share. The total
amount raised by the placing was GBP0.45m.
As at 31 December 2009 the Company had cash and cash equivalents, excluding bank
overdrafts, of GBP0.17m (2008: GBP0.05m) and borrowings of GBP1.18m (2008:
GBP0.19m). In March 2010 the Group replaced Clydesdale Bank with Coutts as its
principal bankers. At the same time it secured a GBP0.50m overdraft facility
and entered into a long-term loan note of GBP1.50m secured at 9% with Pennine
AIM VCT PLC. Based on the forecast results of the Group and the above
facilities, the directors are comfortable that the Company and Group will be
able to continue as a going concern for the foreseeable future.
Outlook
We are committed to building Chuggington into an evergreen property. We believe
we have made excellent progress in 2009 and have put in a place a formidable
line up of broadcast and consumer product partners. The first quarter of 2010
has started very well and we anticipate that for the remainder of 2010 and
beyond we will see significant growth as we look to build on the achievements
made to date.
Rob Lawes
Chief Executive Officer
Ludorum plc
Consolidated statement of comprehensive income
For the year ended 31 December 2009
+-------------------------------+-------+---------------+--------------+
| | | UNAUDITED | AUDITED |
| |Notes | For the year | For the |
| | | ended | year ended |
| | | 31 December | 31 December |
| | | 2009 | 2008 |
| | | GBP000 | GBP000 |
+-------------------------------+-------+---------------+--------------+
| Continuing operations | | | |
+-------------------------------+-------+---------------+--------------+
| Revenue | 2 | 2,142 | 170 |
+-------------------------------+-------+---------------+--------------+
| Cost of sales | | (988) | (131) |
+-------------------------------+-------+---------------+--------------+
| Gross profit | | 1,154 | 39 |
+-------------------------------+-------+---------------+--------------+
| Costs attributable to Share | | (414) | (422) |
| Schemes | | | |
+-------------------------------+-------+---------------+--------------+
| Other administrative expenses | | (2,425) | (2,004) |
+-------------------------------+-------+---------------+--------------+
| Total administrative expenses | | (2,839) | (2,426) |
+-------------------------------+-------+---------------+--------------+
| Operating loss | | (1,685) | (2,387) |
+-------------------------------+-------+---------------+--------------+
| Finance costs - bank interest | | (21) | (8) |
+-------------------------------+-------+---------------+--------------+
| Finance income - bank | | - | 29 |
| interest | | | |
+-------------------------------+-------+---------------+--------------+
| Net finance (cost)/income | | (21) | 21 |
+-------------------------------+-------+---------------+--------------+
| Loss before taxation | | (1,706) | (2,366) |
+-------------------------------+-------+---------------+--------------+
| Taxation | 3 | (6) | (5) |
+-------------------------------+-------+---------------+--------------+
| Loss for the year | | (1,712) | (2,371) |
+-------------------------------+-------+---------------+--------------+
| Other comprehensive (loss) / | | | |
| income: | | (3) | 8 |
| Foreign exchange differences | | | |
+-------------------------------+-------+---------------+--------------+
| Total comprehensive (loss) / | | (1,715) | (2,363) |
| income for the year | | | |
+-------------------------------+-------+---------------+--------------+
| Loss per share (basic and | 4 | (19.7p) | (29.3p) |
| diluted) | | | |
+-------------------------------+-------+---------------+--------------+
Ludorum plc
Consolidated balance sheet for the year ended 31 December 2009
+-------------------------------+-------+-----------+--------------+
| | | UNAUDITED | AUDITED |
| |Notes | GROUP | GROUP |
| | | 2009 | 2008 |
| | | GBP000 | GBP000 |
+-------------------------------+-------+-----------+--------------+
| Assets | | | |
+-------------------------------+-------+-----------+--------------+
| Non-current assets | | | |
+-------------------------------+-------+-----------+--------------+
| Property, plant and equipment | | 66 | 14 |
+-------------------------------+-------+-----------+--------------+
| Intangible assets | 5 | 1,998 | 1,477 |
+-------------------------------+-------+-----------+--------------+
| | | 2,064 | 1,491 |
+-------------------------------+-------+-----------+--------------+
| Current assets | | | |
+-------------------------------+-------+-----------+--------------+
| Trade and other receivables | | 2,121 | 720 |
+-------------------------------+-------+-----------+--------------+
| Cash and cash equivalents | | 169 | 46 |
+-------------------------------+-------+-----------+--------------+
| | | 2,290 | 766 |
+-------------------------------+-------+-----------+--------------+
| Liabilities | | | |
+-------------------------------+-------+-----------+--------------+
| Current liabilities | | | |
+-------------------------------+-------+-----------+--------------+
| Income tax payable | | (9) | (3) |
+-------------------------------+-------+-----------+--------------+
| Trade and other liabilities | | (5,026) | (2,035) |
+-------------------------------+-------+-----------+--------------+
| Borrowings | 6 | (1,183) | (186) |
+-------------------------------+-------+-----------+--------------+
| | | (6,218) | (2,224) |
+-------------------------------+-------+-----------+--------------+
| Net current liabilities | | (3,928) | (1,458) |
+-------------------------------+-------+-----------+--------------+
| Non-current liabilities | | | |
+-------------------------------+-------+-----------+--------------+
| Share ownership liability | | (524) | - |
+-------------------------------+-------+-----------+--------------+
| Provisions for liabilities | | - | (104) |
| and charges | | | |
+-------------------------------+-------+-----------+--------------+
| Net liabilities | | (2,388) | (71) |
+-------------------------------+-------+-----------+--------------+
| Shareholders' equity | | | |
+-------------------------------+-------+-----------+--------------+
| Ordinary shares | 7 | 84 | 81 |
+-------------------------------+-------+-----------+--------------+
| Deferred shares | | 50 | 50 |
+-------------------------------+-------+-----------+--------------+
| Share premium | | 7,885 | 7,435 |
+-------------------------------+-------+-----------+--------------+
| Share based payments reserve | | 30 | 1,085 |
+-------------------------------+-------+-----------+--------------+
| Foreign currency translation | | 5 | 8 |
+-------------------------------+-------+-----------+--------------+
| Retained losses | | (10,442) | (8,730) |
+-------------------------------+-------+-----------+--------------+
| Total shareholders' deficit | | (2,388) | (71) |
+-------------------------------+-------+-----------+--------------+
Ludorum plc
Consolidated statement of changes in equity
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| | UNAUDITED | UNAUDITED | UNAUDITED | UNAUDITED | UNAUDITED | UNAUDITED |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| | | | | | | |
| 2009 | | | | Share | Foreign | Total |
| | Share | Share | Accumulated | based | currency | shareholders' |
| | capital | Premium | losses | payments | translation | deficit |
| | GBP000 | GBP000 | GBP000 | reserve | GBP000 | GBP000 |
| | | | | GBP000 | | |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| At 1 January 2009 | 131 | 7,435 | (8,730) | 1,085 | 8 | (71) |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| Comprehensive | | | | | | |
| income: | | | | | | |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| Loss for the year | - | - | (1,712) | - | - | (1,712) |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| Other | | | | | | |
| comprehensive | | | | | (3) | (3) |
| income: | - | - | - | - | | |
| | | | | | | |
| Foreign exchange | | | | | | |
| differences | | | | | | |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| Total | - | - | (1,712) | - | (3) | (1,715) |
| comprehensive | | | | | | |
| income | | | | | | |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| Transactions with | | | | | | |
| owners: | | | | | | |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| Credit relating | - | - | - | 30 | - | 30 |
| to | | | | | | |
| Share based | | | | | | |
| payments reserve | | | | | | |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| Transfer to share | - | - | - | (1,085) | - | (1,085) |
| ownership | | | | | | |
| liability | | | | | | |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| New shares issued | 3 | 450 | | | - | 453 |
| | | | - | - | | |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| Total | 3 | 450 | | (1,055) | | (602) |
| transactions with | | | - | | - | |
| owners | | | | | | |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| At 31 December | 134 | 7,885 | (10,442) | 30 | 5 | (2,388) |
| 2009 | | | | | | |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| | AUDITED | AUDITED | AUDITED | AUDITED | AUDITED | AUDITED |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| | | | | | Foreign | Total |
| 2008 | Share | Share | Accumulated | Incentive | currency | shareholders' |
| | capital | Premium | losses | Option | translation | deficit |
| | GBP000 | GBP000 | GBP000 | plan | GBP000 | GBP000 |
| | | | | GBP000 | | |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| At 1 January 2008 | 131 | 7,435 | (6,359) | 700 | - | 1,907 |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| Comprehensive | | | | | | |
| income: | | | | | | |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| Loss for the year | - | - | (2,371) | - | - | (2,371) |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| Other | | | | | | |
| comprehensive | | | | | 8 | 8 |
| income: | - | - | - | - | | |
| | | | | | | |
| Foreign exchange | | | | | | |
| differences | | | | | | |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| Total | - | - | (2,371) | - | 8 | (2,363) |
| comprehensive | | | | | | |
| income | | | | | | |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| Transactions with | | | | | | |
| owners: | | | | | | |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| Credit relating | | | | 385 | | 385 |
| to | - | - | - | | - | |
| Share based | | | | | | |
| payments reserve | | | | | | |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| Total | | | | 385 | - | 385 |
| transactions with | - | - | - | | | |
| owners | | | | | | |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
| At 31 December | 131 | 7,435 | (8,730) | 1,085 | 8 | (71) |
| 2008 | | | | | | |
+-------------------+-----------+-----------+-------------+-----------+-------------+---------------+
Ludorum plc
Consolidated cash flow statement for the year ended 31 December 2009
+----------------------------------+-------+-----------+---------+
| | | UNAUDITED | AUDITED |
| | Notes | GROUP | GROUP |
| | | 2009 | 2008 |
| | | GBP000 | GBP000 |
+----------------------------------+-------+-----------+---------+
| | | | |
+----------------------------------+-------+-----------+---------+
| Cash flows from operating | | | |
| activities | | | |
+----------------------------------+-------+-----------+---------+
| Cash used in operations | | (478) | (867) |
+----------------------------------+-------+-----------+---------+
| Interest received | | - | 29 |
+----------------------------------+-------+-----------+---------+
| Interest paid | | (21) | (8) |
+----------------------------------+-------+-----------+---------+
| Taxation paid | | | |
| | | - | - |
+----------------------------------+-------+-----------+---------+
| Net cash used in operating | | (499) | (846) |
| activities | | | |
+----------------------------------+-------+-----------+---------+
| Cash flows from investing | | | |
| activities | | | |
+----------------------------------+-------+-----------+---------+
| Purchase of property, plant and | | (81) | (16) |
| equipment | | | |
+----------------------------------+-------+-----------+---------+
| Investment in intangible assets | | (747) | (990) |
+----------------------------------+-------+-----------+---------+
| Net cash used in investing | | (828) | (1,006) |
| activities | | | |
+----------------------------------+-------+-----------+---------+
| Cash flows from financing | | | |
| activities | | | |
+----------------------------------+-------+-----------+---------+
| Net proceeds from issuance of | | 453 | - |
| ordinary shares | | | |
+----------------------------------+-------+-----------+---------+
| Proceeds from bank loan | | 1,200 | - |
+----------------------------------+-------+-----------+---------+
| Repayment of bank loan | | (73) | - |
+----------------------------------+-------+-----------+---------+
| Net cash generated from | | 1,580 | - |
| financing activities | | | |
+----------------------------------+-------+-----------+---------+
| | | | |
+----------------------------------+-------+-----------+---------+
| Net increase / (decrease) in | | 253 | (1,852) |
| cash and cash equivalents | | | |
+----------------------------------+-------+-----------+---------+
| Cash and cash equivalents | | (140) | 1,712 |
| (including bank overdraft) at 1 | | | |
| January 2009 | | | |
+----------------------------------+-------+-----------+---------+
| Cash and cash equivalents | | 113 | (140) |
| (including bank overdraft) at 31 | | | |
| December 2009 | | | |
+----------------------------------+-------+-----------+---------+
Ludorum plc
Notes to the preliminary results for the year ended 31 December 2009
1. Basis of preparation
The financial information in this preliminary announcement is unaudited and does
not constitute the Group's statutory accounts within the meaning of section 434
of the Companies Act 2006. It has been extracted from the draft statutory
accounts of the Group for that year which are still subject to audit and
approval by the board of directors and are prepared in accordance with IFRS as
adopted by the European Union and with those parts of the Companies Act 2006
applicable to companies reporting under IFRS. Those financial statements will be
approved by the board of directors and filed with the Registrar of Companies in
due course. The financial information for the year ended 31 December 2008 has
been extracted from the statutory accounts of the Group for that year, which
have been delivered to the Registrar of Companies. The auditors' report on those
accounts was unqualified and did not contain a statement under section 237(2) or
section 237(3) of the Companies Act 1985.
The basis of preparation of the
financial information in both years presented is consistent with the accounting
policies set out in the Group's statutory accounts for the year ended 31
December 2008 except that the following standards and amendments to existing
standards have been adopted by the Group with effect from 1 January
2009:
IAS 1 (Revised) 'Presentation of financial statements': The revised
standard prohibits the presentation of items of income and expenses (that is
'non-owner changes in equity') in the statement of changes in equity, requiring
'non-owner changes in equity' to be presented separately from owner changes in
equity. All 'non-owner changes in equity' are required to be shown in a
performance statement. Under the revised standard, entities can choose whether
to present one performance statement (the statement of comprehensive income) or
two statements (the income statement and statement of comprehensive income). The
Group has elected to present one Consolidated Statement of Comprehensive Income.
Comparatives for 2008 have been represented accordingly.
IAS 23 (Amendment)
'Borrowing costs': This standard requires an entity to capitalise borrowing
costs directly attributable to the acquisition, construction or production of a
qualifying asset (one that takes a substantial period of time to get ready for
use or sale) as part of the cost of that asset. Borrowing costs which meet this
definition have therefore been capitalised with effect from 1 January
2009.
IFRS 8 "Operating segments": This standard replaces IAS 14, "Segment
reporting". It requires a 'management approach' to be adopted, under which
segment information is presented on the same basis as for internal reporting
purposes. Operating segments are reported in a manner consistent with the
internal reporting provided to the chief operating decision-maker, which has
been identified as being the board of directors, the primary executive body
responsible for all strategic decisions. As set out in Note 2, the Group has
only one operating segment, the development and exploitation of its rights in
Chuggington. Comparatives for 2008 have been represented accordingly.
2. Segmental reporting
The Group currently has one operating segment, the development and exploitation
of its rights in Chuggington. Further information about revenue derived from
the Group's product lines is set out below.
Management information used by the CODM is in a format similar to the
Consolidated Statement of Comprehensive Income and Consolidated Balance Sheet.
Revenue by product line
+---------------------+---------------------+---------------------+
| | UNAUDITED | AUDITED |
| | For the year ended | For the year ended |
| | 31 December 2009 | 31 December 2008 |
| | GBP000 | GBP000 |
+---------------------+---------------------+---------------------+
| | | |
+---------------------+---------------------+---------------------+
| Television | 1,359 | 155 |
+---------------------+---------------------+---------------------+
| Home Entertainment | 227 | 11 |
+---------------------+---------------------+---------------------+
| Consumer products | 406 | 4 |
+---------------------+---------------------+---------------------+
| Publishing | 112 | - |
+---------------------+---------------------+---------------------+
| Other | 38 | - |
+---------------------+---------------------+---------------------+
| | 2,142 | 170 |
+---------------------+---------------------+---------------------+
Geographical analysis of revenue by location of customer
+---------------------+---------------------+---------------------+
| | UNAUDITED | AUDITED |
| | For the year ended | For the year ended |
| | 31 December 2009 | 31 December 2008 |
| | GBP000 | GBP000 |
+---------------------+---------------------+---------------------+
| | | |
+---------------------+---------------------+---------------------+
| UK | 454 | 170 |
+---------------------+---------------------+---------------------+
| Europe, Middle East | 1,047 | - |
| & Africa | | |
+---------------------+---------------------+---------------------+
| Asia | 249 | - |
+---------------------+---------------------+---------------------+
| Australasia | 222 | |
+---------------------+---------------------+---------------------+
| Americas | 170 | - |
+---------------------+---------------------+---------------------+
| | 2,142 | 170 |
+---------------------+---------------------+---------------------+
All material assets are located in the United Kingdom.
3. Taxation
+---------------------+---------------------+---------------------+
| | UNAUDITED | AUDITED |
| | For the year ended | For the year ended |
| | 31 December 2009 | 31 December 2008 |
| | GBP000 | GBP000 |
+---------------------+---------------------+---------------------+
| | | |
+---------------------+---------------------+---------------------+
| Current tax | | |
+---------------------+---------------------+---------------------+
| UK taxation | - | - |
+---------------------+---------------------+---------------------+
| Overseas taxation | 6 | 5 |
+---------------------+---------------------+---------------------+
| Total current tax | 6 | 5 |
| expenses | | |
+---------------------+---------------------+---------------------+
| Deferred taxation | - | - |
+---------------------+---------------------+---------------------+
| Total income tax | 6 | 5 |
| expense | | |
+---------------------+---------------------+---------------------+
The tax assessed for the year differs from the UK Small Company tax rate in the
UK. The difference is explained below:
+-------------------------------------------+-----------+----------+
| | UNAUDITED | AUDITED |
| | | For the |
| | For the | year |
| | year | ended |
| | ended | 31 |
| | 31 | December |
| | December | 2008 |
| | 2009 | GBP000 |
| | GBP000 | |
+-------------------------------------------+-----------+----------+
| Loss before taxation | (1,706) | (2,366) |
+-------------------------------------------+-----------+----------+
| Loss before taxation multiplied by the | (358) | (491) |
| weighted-average rate of UK corporation | | |
| tax applicable to small companies of 21% | | |
| (2008: 20.75%) | | |
+-------------------------------------------+-----------+----------+
| Effects of: | | |
+-------------------------------------------+-----------+----------+
| Overseas taxation | 6 | 5 |
+-------------------------------------------+-----------+----------+
| Expenses not deductible for tax purposes | 5 | 20 |
+-------------------------------------------+-----------+----------+
| Losses available to carry forward and | 353 | 471 |
| other timing differences | | |
+-------------------------------------------+-----------+----------+
| | 6 | 5 |
+-------------------------------------------+-----------+----------+
4. Loss per share
Basic earnings per share ("EPS") is calculated by dividing the earnings
attributable to ordinary shareholders by the weighted average number of ordinary
shares outstanding during the year. Because basic EPS results in a loss per
share, the diluted EPS is calculated using the undilutive weighted average
number of shares.
+----------------+----------------+----------------+----------------+
| Basic and | Loss | Weighted | Per-share |
| diluted EPS | attributable | average number | amount |
| | to ordinary | of shares | (pence) |
| | shareholders | | |
| | GBP000 | | |
+----------------+----------------+----------------+----------------+
| | | | |
+----------------+----------------+----------------+----------------+
| 2009 | UNAUDITED | UNAUDITED | UNAUDITED |
+----------------+----------------+----------------+----------------+
| Loss per share | (1,712) | 8,706,001 | (19.7)p |
+----------------+----------------+----------------+----------------+
| | | | |
+----------------+----------------+----------------+----------------+
| 2008 | AUDITED | AUDITED | AUDITED |
+----------------+----------------+----------------+----------------+
| Loss per share | (2,371) | 8,100,001 | (29.3)p |
+----------------+----------------+----------------+----------------+
5. Intangible assets
+---------------------------------------------+--------------------+
| Group | Group |
| | Capitalised costs |
| | 2009 |
| | GBP000 |
+---------------------------------------------+--------------------+
| Cost | |
+---------------------------------------------+--------------------+
| At 1 January 2008 - audited | 536 |
+---------------------------------------------+--------------------+
| Additions | 990 |
+---------------------------------------------+--------------------+
| At 31 December 2008 - audited | 1,526 |
+---------------------------------------------+--------------------+
| Additions - unaudited | 747 |
+---------------------------------------------+--------------------+
| At 31 December 2009 - unaudited | 2,273 |
+---------------------------------------------+--------------------+
| | |
+---------------------------------------------+--------------------+
| Accumulated amortisation | |
+---------------------------------------------+--------------------+
| At 1 January 2008 - audited | - |
+---------------------------------------------+--------------------+
| Charge for the year | 49 |
+---------------------------------------------+--------------------+
| At 31 December 2008 - audited | 49 |
+---------------------------------------------+--------------------+
| Charge for the year - unaudited | 226 |
+---------------------------------------------+--------------------+
| At 31 December 2009 - unaudited | 275 |
+---------------------------------------------+--------------------+
| | |
+---------------------------------------------+--------------------+
| Net book value | |
+---------------------------------------------+--------------------+
| At 31 December 2008 - audited | 1,477 |
+---------------------------------------------+--------------------+
| At 31 December 2009 - unaudited | 1,998 |
+---------------------------------------------+--------------------+
6. Borrowings
The following borrowings are included in current liabilities:
+-------------------------------------------+-----------+----------+
| | UNAUDITED | AUDITED |
| | | For the |
| | For the | year |
| | year | ended |
| | ended | 31 |
| | 31 | December |
| | December | 2008 |
| | 2009 | GBP000 |
| | GBP000 | |
+-------------------------------------------+-----------+----------+
| | | |
+-------------------------------------------+-----------+----------+
| Bank overdraft | 56 | 186 |
+-------------------------------------------+-----------+----------+
| Fixed interest loan | 1,127 | - |
+-------------------------------------------+-----------+----------+
| | 1,183 | 186 |
+-------------------------------------------+-----------+----------+
| Undrawn borrowing facilities | | |
+-------------------------------------------+-----------+----------+
| Bank overdraft | 244 | 114 |
+-------------------------------------------+-----------+----------+
| Fixed interest loan | - | 1,200 |
+-------------------------------------------+-----------+----------+
| | 244 | 1,314 |
+-------------------------------------------+-----------+----------+
7. Called up share capital
+-------------------------------------------+-----------+----------+
| | UNAUDITED | AUDITED |
| | | For the |
| | For the | year |
| | year | ended |
| | ended | 31 |
| | 31 | December |
| | December | 2008 |
| | 2009 | GBP000 |
| | GBP000 | |
+-------------------------------------------+-----------+----------+
| | | |
+-------------------------------------------+-----------+----------+
| Ordinary share capital | 84 | 81 |
+-------------------------------------------+-----------+----------+
In April 2009 the Company placed 324,000 ordinary shares at a price of GBP1.40
per share. In July 2009 the Company issued 936,000 ordinary shares to an
Employee Benefit Trust at a price of 1 pence each.
8. Related parties
During the year, Ludorum Inc, a Group company, rented an office from a company
controlled by a director of the Company. The rent paid during the year was
GBP4,000 (2008: GBP11,000).
Included in trade and other liabilities at the end of the year is GBPnil in
respect of unpaid remuneration owed to directors of the Company ( 2008:
GBP124,908). A further GBPnil has been included in trade and other liabilities
in respect of the employer's National Insurance payable on this remuneration
(2008: GBP10,240).
9. Commitments
In 2007 the Company entered into an agreement with a toy manufacturer under the
terms of which the toy manufacturer agreed to fund 50% of the production cost of
the Company's animated series "Chuggington" in return for which it has a global
master toy licence and the right to participate in the net profit of the
property. The agreed budget for the production of the first series of 52
episodes was $6.3 million (GBP3.9 million). Production of the first 52 episodes
was completed in early 2009. The Company and the toy manufacturer have now
agreed to jointly fund, on the same terms as the first series, the production of
a second series of 26 episodes of Chuggington. The budget for the second series
is $3.5 million (GBP2.2 million). It is expected that all the episodes in the
second series will be completed by mid 2010.
In 2007, the Company entered into an agreement with Shanghai Motion Magic
Digital Entertainment Inc ("Motion Magic") under the terms which Motion Magic
provided animation and editing services for the production of Chuggington. Under
the terms of the agreement, Motion Magic was to deliver 52 episodes for which
the Company was committed to pay a total of RMB 18.9 million (GBP1.38 million)
in instalments over the period of production. The Company fully discharged its
obligation under this agreement in to Motion Magic in 2009. As at 31 December
2008 RMB 5.1 million (GBP519,000) remained outstanding.
In 2009, the Company entered into a further agreement with Motion Magic under
the terms of which Motion Magic is to provide animation and editing services for
the production of a second series of 26 episodes of Chuggington. The Company is
committed to pay between RMB 10.3 million and RMB 10.9 million (between
GBP910,000 and GBP960,000.) As at the end of the year, the Company had paid RMB
1 million (GBP92,000).
Under the terms of the agreement with the toy manufacturer described above, 50%
of the amount paid and payable to Motion Magic has been or will be refunded to
the Company by the toy manufacturer.
10. Post balance sheet events
In March 2010 the Company obtained overdraft facilities of GBP500,000 from
Coutts & Co. The overdraft is secured by a first charge over the Company's
assets (including the Company's intellectual property). In March 2010 the
Company also issued GBP1.5m of loan notes to Pennine AIM VCT PLC. The loan notes
are redeemable within five years. If the Company redeems the loan notes within
two years the redemption will be GBP1.25 per GBP1 of loan notes (less interest
paid prior to redemption). If the loan notes are redeemed after two years the
loan notes are redeemable at par. The interest payable on the loan notes is the
greater of 9% or 3% above LIBOR for the first three years. After three years,
the interest rate is 15%. The loan notes are secured by a second charge over the
Company's assets (and a charge over the assets of Ludorum Enterprises Limited, a
wholly owned subsidiary of the Company).
In March 2010 the Company also repaid the outstanding balance on its fixed
interest loan from Clydesdale Bank. The Group also changed its bankers from
Clydesdale Bank to Coutts & Co.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR LLFLASVIRFII
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