Medi@Invest PLC - Interim Results
December 16 1999 - 2:30AM
UK Regulatory
RNS Number:6199C
Medi@Invest PLC
16 December 1999
Medi@Invest PLC
INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 1999
The Board of Medi@Invest PLC (the "Group"), the media and internet investment
company, announce their interim results for the six months ended 30 September
1999.
Highlights
- The Group has been granted an option to acquire between 55% and 65% of KZN
Media Limited, the developer of KZuk.net, the UK's first safe and secure
family friendly Internet Service and Content Provider, with an arrangement
in place to acquire the balance of shares in due course.
- KZuk.net expected to launch in January 2000, with over 30,000 pages of
content, licensed rights to animated characters and numerous marketing and
sponsorship deals.
- Successful share issue of 44 million new ordinary shares in November,
raising #2.4 million.
- Strong cash position; current cash balance of #3 million.
Commenting on the results, Sir James Harvie-Watt, Chairman, said:
"Our successful fund-raising in November has enabled us to make our first
strategic investment in KZuk.net. We believe that, as the UK's first safe and
secure family oriented ISP, there is enormous potential to meet the demands of
the fastest growing internet population of 7 to 17 year olds. The ultimate
intention is for KZuk.net to become an interactive digital TV channel."
The text of full interim results to be posted to shareholders follows:
"Medi@Invest PLC
Chairman's Interim Statement
Overview
The first half of the 1999/2000 financial year and its immediate aftermath,
has been an exciting time for Medi@Invest PLC (the "Group"). Following an
Extraordinary General Meeting of shareholders on 12 October 1999, the Group
completed on the sale of the business trading as Edwards Hardy Fencing (the
"Fencing Division"), renamed itself Medi@Invest PLC, raised funds and changed
its strategy to focus on the opportunities currently available in the
development of media and the Internet. Since the EGM, it has raised further
funds and has announced its first new investment. This is a loan with an
option that will result in a majority shareholding in KZN Media Limited
("KZN"), a company developing a family oriented Internet Service and Content
Provider ("ISP") called KZuk.net.
Fund Raisings
The placing and open offer, which closed in October, successfully raised cash
of # 1.2m. Subsequent to the announcement that the Group had agreed to provide
an initial debt facility to KZN, a further capital raising was completed on 23
November by issuing 44m new ordinary shares to raise # 2.4m. At this time the
Group also appointed Insinger Townsley as its new Nominated Broker.
The Group currently has cash balances of approximately # 3.0m, which the
Directors believe will be sufficient to complete the development and promotion
of KZuk.net.
KZN Media Limited
KZN is a new company that is developing the UK's first family-friendly ISP and
content channel with the aim to provide a secure and safe zone for 5-12 year
olds to explore largely proprietary educational and entertainment content,
with password-controlled access to the worldwide web for adults and older
children. One in four UK children who are 17 or under are regular Internet
users - an estimated three million. This group represents the fastest growing
Internet population, with NOP estimating a global total of 77m under 18-year
olds by 2005. KZuk.net will be launched in January 2000 with over 30,000
pages of content, licensed rights to animated characters and numerous
marketing and sponsorship deals. With greater bandwidth and further content
development, the ultimate intention is for KZuk.net to become an interactive
digital TV channel.
The core management team at KZN comprises Peter Hitchen, Gary Lorimer, Paul
Bailey, Alexander Watson and Nissim Cohen. They have many years experience in
TV and film finance, marketing, sales and licencing, IT management and
software development for ISPs.
The Group has agreed to fund the development and launch of KZuk.net through a
loan agreement secured by a debenture of between #2,250,000 and #2,750,000.
The Group has been granted an option to acquire a shareholding of between 55%
and 65% of the enlarged issued share capital of KZN by way of capitalisation
of part of the loan for the nominal value of these shares (the "Option") and
has agreed to issue shares in the Group to the current shareholders of KZN if
certain conditions in relation to the ISP are satisfied. There are also
provisions to acquire the minority shareholding balance of KZN through the
issue of further new shares in the Group. A circular is expected to be issued
shortly to shareholders providing further details of this transaction and
calling an EGM to seek approval to exercise the Option.
Results for six months to 30 September 1999
The operating loss from continuing activities of #59,000 reported for the six
months to 30 September 1999 was the overhead cost of the parent company. The
Directors endeavoured to minimise the costs of running the Group during this
period prior to the refinancing.
The period under review also includes the results of the Fencing Division.
This discontinued operation is shown in a separate column and made no
contribution to the Group results at the operating profit level.
Dividend
The Board consider it inappropriate to declare an interim dividend, as the
Group's priority is to concentrate its available resources on its Internet
investment in KZN and other complementary growth investment opportunities.
Future Strategy
In the last circular to shareholders the Board stated that it intended to
pursue investment opportunities within the areas of 'media and the Internet'.
In order to concentrate management time, the expertise of any new employees
and increase the cross-benefits of investments your Directors believe that a
greater degree of focus on entertainment, education, publishing and
merchandising will deliver the greatest value for shareholders.
Profit and Loss Account
UNAUDITED UNAUDITED AUDITED
6 months to 6 months to 12 months to
30 September 30 September 31 March
1999 1998 1999
Contin- Discon- Total Contin- Discon- Total Contin- Discon- Total
-uing -tinued -uing -tinued -uing -tinued
#'000 #'000 #'000 #'000 #'000 #'000 #'000 #'000 #'000
Turnover - 198 198 - 2710 2710 - 2946 2946
Cost of sales - -150 -150 - -2437 -2437 - -2713 -2713
Gross profit - 48 48 - 273 273 - 233 233
Administration -59 -48 -107 -193 -339 -532 -384 -413 -797
expenses
Operating loss -59 - -59 -193 -66 -259 -384 -180 -564
Loss on disposal
of business - - - - -119 -119 - -119 -119
Loss on ordinary
activities before
interest and
taxation -59 - -59 -193 -185 -378 -384 -299 -683
Interest payable
and similar charges - -11 -12
Interest received 1 13 20
Loss on ordinary
activities
before taxation -58 -376 -675
Taxation on loss
on ordinary activities - - -
Loss on ordinary
activities
after taxation -58 -376 -675
Loss per share (pence) (see note 1)
- basic (0.09) (0.59) (1.05)
- diluted (0.09) (0.59) (1.05)
The results of operations which have been discontinued in the six months ended
30 September 1999 have been restated in the prior periods' comparisons in
order to be consistent with the treatment in the current period's accounts.
Balance Sheet
UNAUDITED AUDITED
at 30 September at 31 March
1999 1999
#'000 #'000 #'000 #'000
Fixed Assets
Tangible assets - 5
Current Assets
Stock - 18
Debtors 33 140
Cash and bank balances 47 104
80 262
Creditors:
amounts falling due
within one year 58 213
Net Current Assets 22 49
Net Assets 22 54
Called up share capital 1855 1829
Reserves
Share premium account 318 318
Capital redemption reserve 10 10
Profit and loss account -2161 -2103
-1833 -1775
Shareholders' funds 22 54
Shareholders' funds include #227,000 (31 March 1999: #227,000) relating to
non-equity interests.
Notes:
1 The basic loss per share is based on 64,215,917 ordinary shares, (1998:
64,079,524 ordinary shares), being the weighted average number of ordinary
shares in issue during the six month period, and on the loss after taxation
for the respective periods.
2 The financial information set out herein does not comprise full financial
statements within the meaning of the Companies Act 1985. Full accounts of
the Group for the year ended 31 March 1999, on which the auditors gave a
qualified opinion arising from limitation of audit scope, have been
delivered to the Registrar of Companies.
3 All recognised gains and losses have been included in the profit and loss
account.
4 There is no material difference between the results disclosed in the profit
and loss account and the results prepared on an historical cost basis.
5 Copies of this statement of interim results will be sent to shareholders
of Medi@Invest PLC. Further copies are available to the public free of
charge from the Company's registered office at One Portland Place, London,
W1N 3AA."
Enquiries
Robin Jones Medi@Invest PLC 0171 706 3000
Jonathan Hinton Arthur Andersen Corporate Finance 0171 438 3000
Simon Fox Insinger Townsley 0171 377 6161
Rupert Ashe GCI Focus 0171 398 0800
END
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