The information contained within
this announcement is deemed by the Company to constitute inside
information for the purposes of Regulation 11 of the Market Abuse
(Amendment) (EU Exit) Regulations 2019/310.
Aeorema
Communications plc / Index: AIM / Epic: AEO / Sector:
Media
25 March 2024
Aeorema Communications
plc
("Aeorema", the "Company" or the "Group")
Interim Results and FY
Projections
Aeorema Communications plc
(AIM: AEO), a leading
strategic communications group, today announces its unaudited
interim results for the six months ended 31 December 2023 ("H1
2024").
OVERVIEW
|
•
|
Revenue of
£6,553,779 (H1 2023:
£7,121,103)
|
|
•
|
Loss before taxation
of £243,534 (H1 2023 Profit:
£326,021)
|
|
•
|
Cash at date of this release of
£3,717,848
|
|
•
|
Expecting to reaffirm commitment to
shareholders by maintaining the dividend policy
|
|
•
|
Winner of multiple industry
awards
|
|
|
•
|
Cheerful Twentyfirst named Agency
Team of the Year for the first time in the Experience category at
industry-leading The Drum Awards Festival and nominated in four
other award categories
|
|
|
•
|
Post period end, Cheerful
Twentyfirst named Creative Team of the Year at the 2024 CN Agency
Awards for sixth year running
|
CHAIRMAN'S STATEMENT
As we navigate the dynamic landscape
of our 2024 financial year, I present our interim results for the
six months ended 31 December 2023 and provide insight into our
strategic direction moving forward.
We are confident of delivering a
full year profit of not less than £400,000, despite the loss in the
first half of this financial year. We also expect to have a near
record profit of £650,000 in the second half of this financial
year. This is based on projecting revenue for the
full year of no less than £19 million, and with three months still
remaining in the Company's financial year ending 30 June 2024
("FY2024"), we are confident in achieving this
revenue.
Having made significant investment
in the structure and foundations of our business in FY 2023, during
H1 2024 we have focussed on investing in our team, both in the US
and UK, which has impacted our profit margin. We are therefore
amending our business model to have a better balance in costs
between the first half and second halves of our financial year and
we are also aggressively chasing business for the first half to
improve the balance between first and second half
revenue.
Like many agencies in its sector,
Aeorema's clients are facing a challenging economic landscape which
is resulting in delays in the decision-making process on committing
spending and, consequently, in some cases, the temporary
postponement of events. More particularly for Aeorema, several
brands have delayed projects and pushed them into the first half of
the 2024 calendar year (the second half of the Company's financial
year) or into Aeorema's 2024/25 financial year, which is the case
for approximately £2 million of contracted revenue.
Despite the disappointing impact of
these timing shifts on both our half year and anticipated full year
figures, we remain optimistic about the future. We have a robust
pipeline of client projects and a resilient blue-chip client base.
Importantly, Aeorema has maintained the loyalty of its client base,
having not experienced any client losses during this period, which
reflects the trust they place in our capabilities to deliver
exceptional, world-class, experience events. This, and discussions
with clients about future plans, gives us significant comfort in
maintaining a positive outlook for the remainder of our 2023/24
financial year and for our 2024/25 financial year as we continue to
grow organically and capitalise on an uptick in revenue driven by
the realisation of postponed projects.
With a focus on adaptability and
forward planning, Aeorema is well positioned for the future and is
confident in its ability to deliver sustainable growth and value
creation over the long term. We also expect to reaffirm our
commitment to shareholders by maintaining our dividend
policy.
While this half year's financial
performance reflects the impact of project timing, we are
encouraged by the underlying strength of our business and our
pipeline. Our focus remains steadfast on delivering creative
brilliance for our clients on a global scale, and sustained growth
and value to our shareholders.
M Hale
Chairman
22 March 2024
*ENDS*
|
Andrew Harvey
|
Aeorema Communications
plc
|
+44 (0)20 7291 0444
|
|
John Depasquale / Liz Kirchner /
Lauren Wright
(Corporate Finance)
Kelly Gardiner / Joscelin Pinnington
(Sales and Corporate Broking)
|
Allenby Capital Limited
(Nominated Adviser and
Broker)
|
+44 (0)20 3328 5656
|
|
Paul Dulieu / Isabel de
Salis
|
St Brides Partners Ltd
(Financial PR)
|
aeorema@stbridespartners.co.uk
|
Notes to Editors
Aeorema Communications plc, (AIM:
AEO) is a leading strategic communications group with offices in
London, New York, and Amsterdam. The Group provides bespoke event
services, comprising live, virtual, and hybrid experiences to an
established international blue-chip client base spanning a broad
range of sectors, including finance, professional services,
advertising, IT, gaming, fashion, fintech, and beverages. The Group
also provides high level consultancy services to help clients
maximise and deliver on their long-term communication strategies
over multiple event and film touchpoints.
Aeorema delivers these services via
its fully owned companies Cheerful Twentyfirst and Cheerful
Twentyfirst, Inc. (the North American arm of Cheerful Twentyfirst)
(cheerfultwentyfirst.com), two live events agencies with film
capabilities that specialise in devising and delivering corporate
communication solutions. The Group also operates Eventful Limited
(www.eventful.co.uk), which provides consultative, high-touch
services including assisting clients with venue sourcing, event
management and incentive travel. With more than 56 years of
combined operating experience and extensive award wins, Aeorema is
a recognised industry thought leader and for the year ended 30 June
2023 reported record revenue and profits (before tax) of £20.2
million and £1.0 million respectively, and also declared a dividend
for the year.
Central to all that the Group does
is its Corporate Social Responsibility charter, which is focussed
on ensuring sustainable, inclusive, and ethical business
operations. To this end, the Group is a pioneer in delivering
innovative strategies and services, including a client carbon
measurement programme to establish a formal structure and approach
around reducing emissions and offsetting both its own and its
clients' carbon footprint.
AEOREMA
COMMUNICATIONS PLC
CONDENSED
CONSOLIDATED INCOME STATEMENT
For the period
ended 31 December 2023
|
|
|
Unaudited
6 Months to 31 December
2023
|
Unaudited
6 Months to 31 December
2022
|
Audited
Year to
30 June
2023
|
|
|
Notes
|
£
|
£
|
£
|
|
Continuing Operations
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
6,553,779
|
7,121,103
|
20,230,231
|
|
Cost of sales
|
|
(5,051,024)
|
(5,595,529)
|
(15,896,463)
|
|
|
|
|
|
|
|
Gross profit
|
|
1,502,755
|
1,525,574
|
4,333,768
|
|
|
|
|
|
|
|
Administrative expenses
|
|
(1,724,982)
|
(1,175,668)
|
(3,240,848)
|
|
|
|
|
|
|
|
Operating (loss) / profit
|
|
(222,227)
|
349,906
|
1,092,920
|
|
|
|
|
|
|
|
Finance income
|
|
20
|
80
|
215
|
|
|
|
|
|
|
|
Finance costs
|
|
(21,327)
|
(23,965)
|
(47,175)
|
|
|
|
|
|
|
|
(Loss) / profit before taxation
|
|
(243,534)
|
326,021
|
1,045,960
|
|
|
|
|
|
|
|
Taxation
|
4
|
125,253
|
(30,553)
|
(288,780)
|
|
|
|
|
|
|
|
(Loss) / profit for the period from continuing
operations
|
|
(118,281)
|
295,468
|
757,180
|
|
|
|
|
|
|
|
Other comprehensive income
|
|
|
|
|
|
Items that may be reclassified to profit or
loss
|
|
|
|
|
|
|
|
|
|
|
|
Exchange differences on translation
of foreign entities
|
|
56,973
|
(29,245)
|
(119,547)
|
|
|
|
|
|
|
|
Other comprehensive income for the period
|
|
56,973
|
(29,245)
|
(119,547)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income for the period
|
|
(61,308)
|
266,223
|
637,633
|
|
|
|
|
|
|
|
Basic and diluted earnings per share from continuing
operations
|
|
|
|
|
|
|
|
|
|
|
|
Basic (pence)
|
5
|
(1.24010)
|
3.18118
|
8.04398
|
|
Diluted (pence)
|
5
|
(1.05251)
|
2.71870
|
6.83499
|
AEOREMA
COMMUNICATIONS PLC
CONDENSED
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
For the period
ended 31 December 2023
|
|
|
Unaudited
6 Months to 31 December
2023
|
Unaudited
6 Months to 31 December
2022
|
Audited
Year to
30 June
2023
|
|
|
|
£
|
£
|
£
|
|
|
|
|
|
|
|
Non-current assets
|
|
|
|
|
|
Intangible assets
|
|
565,181
|
567,682
|
566,431
|
|
Property, plant and
equipment
|
|
379,137
|
389,668
|
428,509
|
|
Right-to-use assets
|
|
633,584
|
760,388
|
696,986
|
|
Deferred taxation
|
|
140,110
|
-
|
14,844
|
|
|
|
1,718,012
|
1,717,738
|
1,706,770
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
Trade and other
receivables
|
|
4,213,279
|
2,834,446
|
3,502,522
|
|
Cash and cash equivalents
|
|
1,342,729
|
3,676,194
|
2,444,100
|
|
Current tax receivable
|
|
-
|
101,426
|
-
|
|
|
|
5,556,008
|
6,612,066
|
5,946,622
|
|
|
|
|
|
|
|
Total assets
|
|
7,274,020
|
8,329,804
|
7,653,392
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
Trade and other payables
|
|
3,584,467
|
4,713,051
|
3,882,938
|
|
Lease liabilities
|
|
109,808
|
141,278
|
109,058
|
|
Bank loans
|
|
69,445
|
69,445
|
83,333
|
|
Current tax payable
|
|
72,510
|
-
|
74,736
|
|
Provisions
|
|
35,000
|
35,000
|
35,000
|
|
|
|
3,871,230
|
4,958,774
|
4,185,065
|
|
|
|
|
|
|
|
Non-current liabilities
|
|
|
|
|
|
Lease liabilities
|
|
594,247
|
668,006
|
612,693
|
|
Bank loans
|
|
-
|
83,334
|
27,778
|
|
Provisions
|
|
18,000
|
9,000
|
13,500
|
|
Deferred taxation
|
|
-
|
4,629
|
-
|
|
|
|
612,247
|
764,969
|
653,971
|
|
|
|
|
|
|
|
Total liabilities
|
|
4,483,477
|
5,723,743
|
4,839,036
|
|
|
|
|
|
|
|
Net
assets
|
|
2,790,543
|
2,606,061
|
2,814,356
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity attributable to equity holder:
|
|
|
|
|
|
Share capital
|
|
1,192,250
|
1,192,250
|
1,192,250
|
|
Share premium
|
|
21,876
|
21,876
|
21,876
|
|
Merger reserve
|
|
16,650
|
16,650
|
16,650
|
|
Other reserve
|
|
270,870
|
205,730
|
233,375
|
|
Capital redemption
reserve
|
|
257,812
|
257,812
|
257,812
|
|
Foreign translation
reserve
|
|
(31,271)
|
2,058
|
(88,244)
|
|
Retained earnings
|
|
1,062,356
|
909,685
|
1,180,637
|
|
|
|
|
|
|
|
Total equity
|
|
2,790,543
|
2,606,061
|
2,814,356
|
AEOREMA
COMMUNICATIONS PLC
CONDENSED
CONSOLIDATED STATEMENT OF CASH FLOWS
For the period
ended 31 December 2023
|
|
|
Unaudited
6 Months to 31 December
2023
|
Unaudited
6 Months to 31 December
2022
|
Audited
Year to
30 June
2023
|
|
|
|
|
|
|
|
|
|
£
|
£
|
£
|
|
Cash flow from operating activities
|
|
|
|
|
|
(Loss) / profit before
taxation
|
|
(243,534)
|
326,021
|
1,045,960
|
|
Adjustments for:
|
|
|
|
|
|
Depreciation of property, plant and
equipment
|
|
67,827
|
48,873
|
109,764
|
|
Depreciation of right-of-use
assets
|
|
63,402
|
63,384
|
126,786
|
|
Amortisation of intangible fixed
assets
|
|
1,250
|
1,250
|
2,500
|
|
Loss on disposal of fixed
assets
|
|
-
|
-
|
9,141
|
|
Share-based payment
|
|
37,495
|
36,774
|
64,419
|
|
Interest on lease
liabilities
|
|
17,804
|
20,244
|
39,212
|
|
Finance income
|
|
(20)
|
(80)
|
(215)
|
|
Dilapidations
|
|
4,500
|
4,500
|
9,000
|
|
Exchange rate differences on
translation
|
|
60,590
|
(28,902)
|
(119,455)
|
|
Operating cash flow before movement in working
capital
|
|
9,314
|
472,064
|
1,287,112
|
|
Increase/(decrease) in trade and
other payables
|
|
(298,470)
|
1,752,830
|
922,716
|
|
(Increase)/decrease in trade and
other receivables
|
|
(710,757)
|
295,592
|
(372,487)
|
|
Cash (used in) / generated from operating
activities
|
|
(999,913)
|
2,520,486
|
1,837,341
|
|
|
|
|
|
|
|
Taxation paid
|
|
(2,241)
|
(279,218)
|
(380,753)
|
|
|
|
|
|
|
|
Cash flow from investing activities
|
|
|
|
|
|
Finance income
|
|
20
|
80
|
215
|
|
Purchase of property, plant and
equipment
|
|
(22,071)
|
(216,406)
|
(325,027)
|
|
Repayment of leasing
liabilities
|
|
(35,500)
|
(71,000)
|
(177,500)
|
|
Net
cash used in investing activities
|
|
(57,551)
|
(287,326)
|
(502,312)
|
|
|
|
|
|
|
|
Cash flow from financing activities
|
|
|
|
|
|
Share issue
|
|
-
|
49,500
|
49,500
|
|
Dividends paid to owners of the
company
|
|
-
|
-
|
(190,760)
|
|
Repayment of bank loans
|
|
(41,666)
|
(41,665)
|
(83,333)
|
|
Net
cash used in financing activities
|
|
(41,666)
|
7,835
|
(224,593)
|
|
|
|
|
|
|
|
Net
increase / (decrease) in cash and cash
equivalents
|
|
(1,101,371)
|
1,961,777
|
729,683
|
|
|
|
|
|
|
|
Cash and cash equivalents at
beginning of period
|
|
2,444,100
|
1,714,417
|
1,714,417
|
|
|
|
|
|
|
|
Cash and cash equivalents at end of period
|
|
1,342,729
|
3,676,194
|
2,444,100
|
|
|
|
|
|
|
AEOREMA
COMMUNICATIONS PLC
NOTES TO THE
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
For the period
ended 31 December 2023
1. General
information
Aeorema Communications plc is a
public limited company incorporated within the United Kingdom. The
company is domiciled in the United Kingdom and its principal place
of business is 87 New Cavendish Street, London, W1W 6XD. The
Company's ordinary shares are traded on the AIM market of the
London Stock Exchange.
These condensed consolidated interim
financial statements for the period ending 31 December 2023
(including comparatives for the periods ended 31 December 2022 and
30 June 2023) were approved by the board of directors on 22 March
2024.
The financial information set out in
this interim report does not constitute statutory accounts for the
purposes of section 434 of the Companies Act (2006). The Group's
statutory financial statements for the year ended 30 June 2023,
prepared under International Financial Reporting Standards (IFRS),
have been filed with the Registrar of Companies. The auditor's
report for those financial statements was unqualified and did not
contain a statement under section 498 (2) or section 498 (3) of the
Companies Act (2006).
The interim financial statements
have been prepared using the accounting policies set out in the
Group's 2023 statutory accounts and have not been
audited.
Copies of the annual statutory
financial statements and the interim report can be found on our
website at www.aeorema.com or can be requested from the Company
Secretary at the Company's registered office: 101 New Cavendish
Street, 1st Floor South, London, W1W 6XH.
2. Basis of
preparation
These condensed consolidated interim
financial statements for the period ended 31 December 2023 have
been prepared in accordance with IAS 34, 'Interim Financial
Reporting' as adopted by the United Kingdom. The interim condensed
consolidated financial statements should be read in conjunction
with the annual financial statements for the year ended 30 June
2023, which have been prepared in accordance with IFRS as adopted
by the United Kingdom.
3. Revenue and
segmental results
The Company uses several factors in
identifying and analysing reportable segments, including the basis
of organisation such as differences in products and geographical
areas. The Board of Directors, being the chief operating decision
makers, has determined that for the period ended 31 December 2023
there is only one reportable operating segment.
4. Income tax
charge
Income period tax is accrued based
on the estimated average annual effective income tax rate of 25 per
cent (2022: 19 per cent).
5. Earnings per
share
Basic earnings per share is
calculated by dividing the profit attributable to ordinary
shareholders by the weighted average number of ordinary shares
outstanding during the year.
Diluted earnings per share are
calculated by dividing the profit attributable to ordinary owners
of the parent by the weighted average number of ordinary shares
outstanding during the year plus the weighted average number of
ordinary shares that would have been issued on the conversion of
all dilutive potential ordinary shares into ordinary
shares.
The following reflects the income
and share data used and dilutive earnings per share
computations:
|
|
Unaudited 6 Months to 31
December 2023
|
Unaudited 6 Months to 31
December 2022
|
Audited Year to 30 June
2023
|
|
|
|
|
|
|
(Loss) / profit for the year
attributable to owners of the Company
|
(£118,281)
|
£295,468
|
£757,180
|
|
|
|
|
|
|
Number of shares
|
|
|
|
|
|
|
|
|
|
Basic weighted average number of
shares
|
9,538,000
|
9,288,000
|
9,413,000
|
|
|
|
|
|
|
Effect of dilutive share
options
|
1,700,000
|
1,580,000
|
1,665,000
|
|
|
|
|
|
|
Diluted weighted average number of
shares
|
11,238,000
|
10,868,000
|
11,078,000
|
|
|
|
|
|
6.
Dividends
During the interim period a dividend
of 3 pence per share (2022: 2 pence per share) was declared to
holders of the Company's ordinary shares in respect of the full
year ended 30 June 2023.
AEOREMA
COMMUNICATIONS PLC
NOTES TO THE
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Continued)
For the period
ended 31 December 2023
7. Related party
transactions
The Group has a related party
relationship with its subsidiaries and its directors. Transactions
between Group companies, which are related parties, have been
eliminated on consolidation and are therefore not included in these
consolidated interim financial statements.
|
|
Unaudited 6 months to 31
December 2023
|
Unaudited 6 months to 31
December 2022
|
|
|
£
|
£
|
|
Subsidiaries
|
|
|
|
Amounts owed by/(to)
subsidiaries
|
503,557
|
370,342
|
|
Amounts owed by/(to) subsidiaries
|
503,557
|
370,342
|
Harris & Trotter LLP is a firm
in which S Haffner is a member. The following was charged to the
Group in respect of professional services.
|
|
Unaudited 6 Months to 31
December 2023
|
Unaudited 6 Months to 31
December 2022
|
|
Harris & Trotter LLP
|
£
|
£
|
|
Aeorema Communications
plc
|
12,950
|
9,450
|
|
Aeorema Limited
|
7,750
|
9,500
|
|
|
20,700
|
18,950
|
Fees charged to Aeorema
Communications plc include £10,000 (2022: £7,500) for the services
of S Haffner as a non-executive director of that
company.
The compensation of key management
(including directors) of the Group is as follows:
|
|
Unaudited 6 Months to 31
December 2023
|
Unaudited 6 Months to 31
December 2022
|
|
|
£
|
£
|
|
Short-term employee
benefits
|
361,004
|
266,375
|
|
Post-employment benefits
|
10,101
|
7,496
|
|
|
371,105
|
273,871
|
For further information visit www.aeorema.com or contact:
Andrew Harvey
Aeorema Communications plc Tel : +44 (0) 20 7291
0444
John Depasquale / Liz Kirchner /
Allenby Capital Limited
Tel : +44 (0) 20 3328 5656
Lauren Wright (Corporate Finance)
Kelly Gardiner / Joscelin Pinnington
(Sales and Corporate Broking)
Paul Dulieu / Isabel de Salis
St
Brides Partners Ltd
aeorema@stbridespartners.co.uk