TIDMCOO
RNS Number : 1518J
Coolabi PLC
25 March 2010
Coolabi plc
("Coolabi" or "the Company")
Final unaudited results for the 18 months ended 31 December 2009
Coolabi plc (AIM: COO), the media company focused on the ownership and creative
management of high quality intellectual property assets, announces final
unaudited results for the 18 months ended 31 December 2009.
Financial Highlights
· EBITDA of GBP0.20m (12 months to 30 June 2008: loss of GBP0.25m), an
improvement of GBP0.45m
· Gross profit of GBP2.04m (12 months to 30 June 2008: GBP0.93m), an
improvement of GBP1.11m
Financial Highlights (12 months to 31 December 2009 comparative review)
· EBITDA of GBP0.38m (12 months to 31 December 2008: loss of GBP0.24m), an
improvement of GBP0.62m
· Gross profit of GBP1.64m (12 months to 31 December 2008: GBP0.93m), an
improvement of GBP0.71m
Corporate Highlights
· Acquisitions of Licensing By Design Ltd. and Ambler, Innes and
Creasey literary estates
Operational Highlights
· Purple Ronnie - continued growth in key categories (greetings card
revenue up nearly a third calendar 2009 over calendar 2007; book sales up 20%
year on year for Valentine's Day 2010 over 2009); US launch on iPhone
· Scarlett & Crimson- strong uptake of cosmetics range with Boots and
announcement today of exciting partnership with Superdrug
· Poppy Cat - new animated series commissioned and now in development
· Bagpuss, Clangers & Ivor the Engine- 4 year extension to distribution
agreement; 60,000 Bagpuss soft toys sold in 2009
· Production - The Large Family (series 2) and Dead Gorgeous both produced
and delivered in the year
Commenting on the results William Harris, Chairman of Coolabi, said:
"This has been a transformational period for the Group. We have achieved the
dual targets of delivering material organic growth and, as a consequence, a
positive EBITDA, whilst at the same time enhancing the underlying value of each
assets in our portfolio of intellectual properties.
"We now have a portfolio of diversified assets at different stages of
development, a number of which we expect to make a contribution for the first
time in 2010, thereby further enhancing our EBITDA growth profile.
"Trading in the first quarter of 2010 has been in line with our expectations.
The timing of a number of projects is such that we expect the second half of the
year to be considerably stronger than the first and we remain confident of our
ability to deliver strong EBITDA growth in the future."
Contacts
+------------------------+---------------------------------------------+
| Coolabi plc | Tel: 020 7258 7080 |
+------------------------+---------------------------------------------+
| Jeremy Banks, Chief | |
| Executive | |
+------------------------+---------------------------------------------+
| Tim Ricketts, Finance | |
| Director | |
+------------------------+---------------------------------------------+
| | |
+------------------------+---------------------------------------------+
| Evolution Securities | Tel: 020 7071 4300 |
+------------------------+---------------------------------------------+
| Bobbie Hilliam / Chris | |
| Clarke | |
+------------------------+---------------------------------------------+
| | |
+------------------------+---------------------------------------------+
| Walbrook PR Ltd | Tel: 020 7933 8780 |
+------------------------+---------------------------------------------+
| Paul McManus | Mob: 07980 541 893 or |
| | paul.mcmanus@walbrookpr.com |
+------------------------+---------------------------------------------+
| Louise Goodeve | Mob: 07823 530 346 or |
| | louise.goodeve@walbrookpr.com |
+------------------------+---------------------------------------------+
Chairman's Statement
Overview
I am pleased to present the Group's results for the 18 months to 31 December
2009. This period has once again seen very good progress made across all our
principal assets and, having previously enhanced the prospects of the group
through strategic acquisitions, I am delighted that the management team has
delivered such attractive organic growth and, in particular, delivered
outstanding gross profit and EBITDA growth, despite the prevailing economic
climate.
Results
We are today reporting a positive EBITDA (Earnings before interest, tax,
depreciation, amortisation, share based payment costs and exceptional items) of
GBP0.20m for the 18 months ended 31 December 2009 ("2009"), as opposed to a loss
of GBP0.25m in the year ended 30 June 2008 ("2008"). The loss before tax rose
to GBP1.38m (2008: GBP0.99m), largely due to a significant increase in the
amortisation of intangible assets, a non-cash item, and also an exceptional
charge principally relating to aborted acquisition costs. A full breakdown of
this charge is provided in the Finance Director's Review.
During the year the Directors decided to change the period end from 30 June to
31 December in order to improve the usefulness of the financial statements and
so comparative figures are for the 12 months ended 30 June 2008.
Share Placings & Acquisitions
On 23 October 2008, we announced the acquisition of 100% of Licensing By Design
Limited (LBD). Enduring British children's classics Bagpuss, Clangers and Ivor
The Engine were created by the renowned partnership of Oliver Postgate and Peter
Firmin and are owned by them and their heirs. Through the acquisition of LBD,
we act as licensing and merchandising agent on behalf of the owners. The cash
consideration for the acquisition was GBP400,000. In order to finance this
acquisition and to provide capacity for further small acquisitions and working
capital for the Company, Coolabi raised GBP750,000 (gross) by way of a placing
of 9,375,000 new Ordinary Shares of one penny each at a price of 8 pence per
share.
This was followed on 3 March 2009, when it was announced that 51% of Eric Ambler
Literary Management Limited, 100% of Michael Innes Literary Management Limited
and 100% of John Creasey Literary Management Limited had been acquired for an
initial consideration of GBP85,000. We believe these literary estates have
good potential for growth and that there is scope to acquire other attractive
literary estates and to build a significant presence in this lucrative market.
On 21 October 2009, we raised approximately GBP1.15 million (gross) by way of a
placing of 14,375,000 new Ordinary Shares of one penny each at a price of 8
pence per share to invest in our properties, most notably Purple Ronnie,
Scarlett & Crimson and Poppy Cat. Investment in these opportunities will help
the Company to continue its EBITDA growth in the future.
Staff
We are fortunate to have such a dedicated and hard-working team at Coolabi and
on behalf of the Board, I would like to thank them for their significant
contribution to our progress over the last 18 months.
Outlook
This has been a transformational period for the Group. We have achieved the
dual targets of delivering material organic growth and, as a consequence, a
positive EBITDA, whilst at the same time enhancing the underlying value of each
asset in our portfolio of intellectual properties.
We now have a portfolio of diversified assets at different stages of
development, a number of which we expect to make a contribution for the first
time in 2010, thereby further enhancing our EBITDA growth profile.
Trading in the first quarter of 2010 has been in line with our expectations.
The timing of a number of projects is such that we expect the second half of the
year to be considerably stronger than the first and we remain confident of our
ability to deliver strong EBITDA growth in the future.
William Harris
Chairman
25 March 2010
Chief Executive's Review
Coolabi has continued to make good progress in the 18 months to 31 December
2009, driving value and revenue growth across both our own and our licensed
properties. The results we are announcing today confirm we have once again
delivered on market expectations and that we have achieved the key deliverable
of gross profit and EBITDA growth (up 120% and 181% respectively), against the
background of very tough economic conditions.
Our strategy is to build a diversified portfolio of cash-generative intellectual
property ("IP") assets that have international appeal across a broad range of
media platforms. We have focussed our attention on building long-term,
sustainable value by acquiring or developing low-risk IP assets and the period
under review has seen the group concentrate on driving good organic growth from
those assets.
I am excited about our current slate of IP assets that is diversified in terms
of both genre and media of exploitation. There is also a good mix of
established properties, those in their infancy and others in development.
Importantly, our IP assets are also diversified between those that do not
require TV exposure in order to deliver attractive long-term returns and those
that do embrace TV, but only when the cost of production is substantially
covered by third parties and a tier 1 broadcaster is attached.
Our focus, therefore, is to enhance the underlying value of each property whilst
at the same time delivering improved revenues from them. The activity across
our portfolio and the stage of development of our IP assets can be summarised as
follows:
i) Purple Ronnie
100% owned and a British institution with a track-record of success dating back
more than 20 years. Well established and growing in its core categories in the
UK (greetings cards and books) with the potential to expand into new categories
and territories. Purple Ronnie is our key wholly-owned asset and we are
delighted to report further significant progress in the period under review.
The attractions of Purple Ronnie to us, when acquiring it in 2007, were its
enduring track record of generating significant cashflow in the UK, its
resilience to economic cycles and its minimal requirement for capital
investment. It is typical of this industry that investment in TV production is
often required to maintain the affections of a property with the public and
hence its returns from licensing - that is not the case with Purple Ronnie.
Additionally, it had established itself, over its life, in a range of key
categories, diversifying its exposure to and therefore its reliance upon any
particular one.
Brand development
Our strategy has been firstly, to review the key aspects of the brand, 'what
makes it tick', and then build the brand plan around maximising its long-term
sustainable earnings in its key categories of greetings cards, books and general
gifts firstly in the UK but with a view to opening new international
opportunities.
In developing the brand we have looked to build on its legacy with the public as
a pre-eminent vehicle for social expression but also developing it for new
audiences. One particular initiative in 2009 was Purple Ronnie's Stand-Up
Poetry Club, which launched at the Edinburgh Festival with Phil Jupitus
headlining, followed by a series of gigs in London. This positioned the brand
with a younger adult target and had the dual appeal of raising the profile of
the brand around one of its key strengths, poetry.
We have also focussed on creating Purple Ronnie's digital presence:
· Purple Ronnie's Express Yourself,the new online home of Purple Ronnie
(www.purpleronnie.com), has just been launched where users are able to design
their own interactive Ronnie scenes or can use 'The Love Guru' to send more
personal messages of affection! The next stage of development will include a
further range of personalised Purple Ronnie products.
· Purple Ronnie also has his first iPhone app, Purple Ronnie's
Create-A-Card, which was launched for Valentine's Day 2010. For 59 pence users
can create their own customised greetings card for every occasion to send to
friends and family.
· All of this activity is supported by dedicated pages on Facebook,
MySpace, Bebo and Twitter.
We are also pleased to report significant commercial progress with Purple Ronnie
during the period.
Category progress - greeting cards
Purple Ronnie has increased its share in its most popular category of greeting
cards. Hallmark reported an increase in royalties of nearly a third in calendar
2009 compared to calendar 2007 (the year in which the asset was bought) despite
the backdrop of difficult market conditions. In addition, the reach of the
brand has once again been extended with all major supermarkets now stocking
cards.
Print on Demand (POD), where consumers can create their own physical card
online, is a growing greeting card market trend. Hallmark has invested in this
area with Purple Ronnie as a key component. Early indications are that POD
revenues could show good growth next year. Off the back of this success, the
recently developed POD Humour range is now also going to be launched at retail
from 2010.
Category progress - publishing
The three year product development partnership with Macmillan is now half way
through its cycle. Macmillan has produced new books that focus on the brand's
strength during annual occasions - The World's Best Boyfriend, The World's Best
Girlfriend (Valentine's), The World's Best Mum (Mother's Day) and The World's
Best Dad (Father's Day) were released during 2009. In addition, a new male
targeted title, The Ultimate Toilet Book, was released in time for the Christmas
humour market alongside a new doodle book format, Totally Doodle, with publisher
Michael O'Mara.
This raft of new titles adds to an already substantial back catalogue of
successful titles that goes from strength to strength:
· Most recently, for Valentine's Day 2010, Macmillan has reported a 20%
year-on-year increase in sales and four titles made it into the top ten of the
Sunday Times Best Seller list.
· Macmillan has also reported a strong sell-in for the new Mother's Day
title ("Reasons Why You're a Super Mum") and is further expanding the reach of
the books by launching Purple Ronnie's Secret Santa for Christmas 2010.
Category progress - gifts
The success of our strategy in greetings cards and publishing and the momentum
being seen in those categories is now being utilised to create wider
opportunities at retail, with a number of new licensees having been signed.
Each licensee has a preferred partner status with specific retailers. For
example, a dedicated Valentine's novelty gifting range was presented in over 650
Clinton's stores representing a value at retail of over GBP0.5 million and the
new book being launched for Father's Day ("Reasons Why You're a Super Dad") has
created a wider themed opportunity at retail - Clinton's will be featuring mugs
and tankards (from licensee Only4U) and promoting The Prostate Cancer Charity
with a set of four themed badges (from licensee Big Badge).
North America
As announced in May 2009, Big Tent Entertainment was appointed to look after
Purple Ronnie in North and South America. Big Tent's strategy for Purple Ronnie
is to launch the brand digitally in order to raise awareness among consumers and
this commenced early in 2010 with the launch of a self-funded iPhone
application. Purple Ronnie's Pix Poetry allows consumers to customise poems and
illustrations with their own photos and send an animated card to friends and
family, all for one download price of 99 cents.
ii) Scarlett & Crimson
Tween/teen girl property with recent book launches in the US & UK. Successful
cosmetics range, in association with Ruby Hammer and Millie Kendall, to be
available in Superdrug in 2010.
Scarlett & Crimson is in its infancy as a property compared with the more
established Purple Ronnie brand. Jointly owned with its creator, Ged Backland,
and with exploitation controlled internationally by Coolabi, this tween/teen
girl property has been developed from the start to be design-led and to fill a
gap in the market which exists internationally. With its first range of
products launching only recently in the UK and the US, it is rapidly gaining
momentum and we are very pleased with the progress made during the period and
are excited about its potential for the future.
Brand development
Scarlett & Crimson has been developed so as to create a successful international
licensing property that is not dependent on having a TV presence for its
success. In so doing, we once again avoid the need to invest significant
amounts of money in the property in advance of its launch. The property has
been developed to have a platform of credibility in its key sector of fashion,
with its own make-up and fashion range, and to have a developing on-line
community.
Scarlett & Crimson's association with Ruby Hammer and Millie Kendall,
established icons in the cosmetics industry through their company, Ruby &
Millie, has significantly raised the profile of the property. It is estimated
that the association with Ruby & Millie helped generate an eleven million plus
press circulation campaign during the course of 2009.
Category progress - publishing & online
The first three books in our 16 book output deal with Simon & Schuster were
launched in the US in Autumn 2009, primarily through Barnes and Noble and
independent retailers. Simon & Schuster launched the first two titles in the UK
via Waterstone's during the same period. The followers of Scarlett & Crimson
now have an online home with the launch of www.scarlettandcrimson.com, where
there is a focus on music creation and the band from the books, Darqstarz. The
girls also have their own Facebook, Bebo and MySpace pages.
Category progress - cosmetics
Our first Scarlett & Crimson cosmetics range, in association with Ruby & Millie,
went into over 300 Boots stores in the UK in Autumn 2009, positioned as a first
teen cosmetics line and aimed at the Christmas gift market. The range achieved
almost 100% sell through and over GBP400k value at retail.
Following this success, as announced today, a brand new everyday cosmetics and
accessories range will be launched in Superdrug in April 2010; over 400 stores
will stock cosmetics self-select ranges and 180 stores will stock the
accessories range. The combined first production run of stock represents
potential retail value of well over GBP1 million. This activity provides us
with a springboard for driving the whole brand in 2010.
North America
Importantly, the early success of Scarlett & Crimson has not been confined to
its home market. Agents have been appointed in a number of territories and in
the US our new licensing agent has negotiated a master apparel licence with
Awake (Jem Sportswear), who are developing product ranges for presentation for
Back to School Autumn 2010 and Spring 2011 and are co-ordinating product
development presentations for a number of other categories.
This positive progress has continued into 2010 and I look forward to announcing
a number of new initiatives in accordance with our KPIs as the year progresses.
iii) Poppy Cat
Internationally successful pre-school favourite based on the hugely popular book
series (over 2.5 million books sold to date) by Lara Jones. Coolabi will own
the copyright in the series with its co-production partner and therefore will
benefit directly from substantially all of the ancillary exploitation derived
from the series, with normal payaways to other founder partners.
Development for the new animated television series of Poppy Cat is now well
underway and the broadcaster in the UK and Australia will be Nickelodeon Jr. In
addition to the international Nickelodeon sales, five additional pre-sales have
also been concluded. Animation is being produced by our established
award-winning co-production partner, King Rollo Films. To ensure the best
possible chance of success for the US market, our development team also includes
two established US 'showrunners', who have previously worked on Rugrats, Olivia
and Mr Men, and a prominent US educational advisor.
The series capitalises on a core brand value of Poppy Cat, that of adventure.
This will serve to strengthen the product proposition with potential licensing
partners. Pitches to prospective toy partners will begin as soon as the
creative materials for the series become available.
iv) Bagpuss, Clangers & Ivor The Engine
Enduring British children's classics created by Oliver Postgate and Peter
Firmin. Coolabi is the international licensing agent and distributor of the
existing TV series.
Bagpuss, Clangers and Ivor The Engine were created by the renowned partnership
of Oliver Postgate and Peter Firmin and are owned by them and their heirs.
Through the acquisition of Licensing By Design (LBD) during the period under
review, we act as licensing and merchandising agent on behalf of the owners.
These properties hold an unrivalled affection in the hearts of the British
public, as most recently evidenced by an onepoll.com survey earlier this month
that placed Bagpuss at number 5 in the Top 10 list of kids TV shows that adults
most wanted to return to our screens.
Coolabi has the ability to develop new audio-visual materials and concepts with
the owners' approval and we are exploring a number of exciting opportunities
with them.
The Coolabi team contains a number of individuals with a track record of success
in reinvigorating classic, much loved properties such as those represented by
LBD. Early efforts have been focused on both the renewal of existing and the
negotiation of new licensing agreements. This has delivered some early
successes; for example, 2009 saw sales of over 60,000 Bagpuss soft toys.
We were also pleased to secure a four year extension to our licence to
distribute the existing series of Bagpuss, Clangers and, for the first time,
Ivor The Engine and a new contract was signed for series distribution of all
three properties on iTunes. Bagpuss (13 X 11 minute pre-school animation) and
Clangers (26 X 5 minute pre-school animation) continued to air daily on Nick Jr.
v) Literary Estates
Eric Ambler (51% owned), Michael Innes (100% owned) and John Creasey (100%
owned).
The Eric Ambler, Michael Innes and John Creasey literary estates were acquired
in 2009 and we believe there is scope to acquire other attractive literary
estates and to build a significant presence in this lucrative market.
Ambler, Innes and Creasey wrote over 600 titles between them, selling millions
of books worldwide; Creasey alone is said to have sold more than 80 million
books in 26 languages. Many of their titles have been adapted for film,
television and radio, including Ambler's Journey Into Fear starring Orson Welles
and The Light of Day, filmed as Topkapi and starring Peter Ustinov.
Good early progress has been made and five of Ambler's titles were re-launched
by Penguin Classics to celebrate the author's centenary and have sold well. As
previously reported, we are encouraged by some of the interest shown by third
parties in re-introducing certain works derived from these literary estates to
new TV and film audiences.
vi) Television Production
The Company's production strategy is to develop high-quality, low-risk
television series utilising its existing development portfolio and rights
library. Initially kick-started through the acquisitions of the children's
assets of Zenith Entertainment and Indie Kids, this strategy is now supplemented
by ongoing in-house development. We have a particular focus on projects that
are capable of being significantly financed before production commences and that
have potential for exploitation into other areas, especially licensing.
We own the following IP assets where the principal source of revenue is TV
production and distribution:
(a) The Large Family
A co-production for BBC/TF1 about a family of elephants based on the successful
series of books by Jill Murphy. Coolabi owns the copyright in the production
with its co-production partner.
Following the significant ratings success of series 1, BBC and TFI commissioned
a second series of The Large Family, with BBC Worldwide again handling
international distribution as well as licensing and merchandising on our behalf.
This was delivered from Autumn 2009 and commenced airing from Christmas 2009.
Early indications are that series 2 is enjoying similar levels of audience
viewership. Series 1 continued to be aired daily on CBeebies throughout most of
2009 and has been sold to over 35 territories.
(b) Dead Gorgeous
BBC/ABC Australia children's live-action co-production. Coolabi owns the
copyright in the production with its co-production partner.
Production of the live action comedy drama series for tweens with partners CBBC,
ABC (Australia), Burberry Productions, Screen Australia, Film Victoria and Cake
distribution has been completed. The production was fully funded and the
development of commercially attractive live action series will continue to be a
core part of our TV production strategy. The series is a wholly-owned Coolabi
Productions concept and has recently launched on both BBC2 and CBBC in the UK
and will launch on ABC in April 2010.
(c) Other Television Assets
Our other television assets include The Worst Witch, Fungus The Bogeyman, King
Arthur's Disasters and The Famous 5.
The Worst Witch (79 X 30 minute live action comedy) was screened on CiTV during
2009 and is distributed on our behalf by ITV Studios Global Entertainment, which
has over 80 deals on the books including broadcast, home video and in-flight
outlets.
King Arthur's Disasters (26 X 11 minute animation) continued to air twice daily
on Nickelodeon and Nicktoons in the UK. Distributed by Cake, it has been sold
to over 25 territories and Cartoon Network (Europe) and ABC (Australia) have
recently renewed their respective licences.
Sir Gadabout (26 X 26 minute 6-9 live action comedy) aired again on CiTV in
2009.
Achievement of Key Performance Indicators
The achievement of the 8 key objectives for the year to 30 June 2009 was
confirmed in the Interim Statement for that 12 month period.
Key Performance Indicators for Year Ending 31 December 2010
At the start of this year, we set ourselves five key objectives for the year
ending 31 December 2010 which focus on the continuing development of our
portfolio of IP assets. These are:
· Put Poppy Cat into production
· Contract a Poppy Cat master toy partner
· Sign up at least two more major retailers in the UK in addition to Boots
(in announcing our partnership with Superdrug today, we are pleased to have
partly achieved this key objective)
· Sign two additional categories for licensing Scarlett & Crimson in the US
· Put at least 2 TV series into development for delivery from 2011
I look forward to updating you on our progress in achieving these during the
course of the year.
Jeremy Banks
Chief Executive
Finance Directors Review
Highlights
Financial Key Performance Indicators
EBITDA (Earnings before interest, tax, depreciation, amortisation, share based
payment costs and exceptional items) improved 181% to a profit of GBP202k in 18
months ended 31 December 2009 ("2009") from a loss of GBP250k in the 12 months
ended 30 June 2008 ("2008").
Gross profit increased by 120% to GBP2,037k in 2009 from GBP926k in 2008.
Normalised operating cash absorbedby the business (net cash absorbed by
operating activities adjusting for the cashflow effect of exceptional items) has
increased by GBP43k to an absorption of GBP449k in 2009 from an absorption of
GBP406k in 2008 due to working capital movements particularly with regard to
production activity.
The move into positive EBITDA, has been achieved because of the increases in
gross margin generated from licensing, GBP715k, and production, GBP397k.
Licensing benefits from the growth in Purple Ronnie, the acquisition of
Licensing by Design and it being an 18 month period, and production had two
series being delivered in the period as opposed to the comparative period's one.
Critically, Operating expenses have continued to be tightly controlled, the
ratio of Operating expenses to Gross profit improving to 0.9 times this period
from 1.3 last year.
During the year the directors decided to change the year-end from 30 June to 31
December to improve the usefulness of the financial statements giving rise to
the current 18 month period. On a pro forma calendar year basis EBITDA has
increased to GBP380k for the year ending 31 December 2009 as opposed to a loss
of GBP239k for the year ended 31 December 2008. Further analysis of the 2009
calendar year results is set out below.
As previously reported, in October 2008, the Company entered into new banking
facilities with Coutts & Co. for an aggregate value of up to GBP2m.
Consolidated Income Statement
Revenue in the period increased 111% to GBP3,357k (2009: GBP1,590k). Gross
income, which includes the value of film & television licence fees on
productions delivered during the year that were contracted directly through
co-production companies, has increased from GBP1,589k to GBP6,690k, an increase
of 321%.
Licensing & merchandising revenue accounts for GBP1,086k of that increase due to
growth in Purple Ronnie and the acquisition of Licensing by Design Ltd. Film &
television revenue, which this year included the delivery of Dead Gorgeous and
The Large Family Series 2, is up 90% to GBP1,441k in 2009 from GBP759k in 2008.
Film & television Gross Income, is up 529% to GBP4,773k in 2009 from GBP759k in
2008.Gross margin increased from 58% to 61%. Operating expenses were GBP1,835k
(2008: GBP1,175k), the increase being due to the 18 month period. The ratio of
Operating expenses to Gross profit has improved (from 1.3 times in 2008 to 0.9
times in the current year). EBITDA has improved by 181% to GBP202k (2008: loss
of GBP250k).
Operating loss has increased to GBP1,258k from GBP912k in 2008 due to an
increase in amortisation charged on intangible assets. This charge has increased
by GBP471k as a result of the 18 month period, recent acquisitions of Licensing
by Design Ltd and the Literary Estates businesses with the intangible assets
recognised from these transactions being amortised in accordance with our
accounting policies. Operating profit before amortisation of intangible assets
and exceptional items was GBP109k an improvement of GBP415k from the loss in
2008 of GBP306k.
As the group is in a net loss position, no tax is payable. IFRS accounting
requires a provision for deferred tax to be created upon the recognition of
intangible assets, which is then released to the income statement in line with
the amortisation charge on these assets.
Earnings per share
Basic and diluted losses per share for the year are 3.5p (2008 - 3.5p).
Net Debt
Net Debt was GBP734k as at 31 December 2009 an increase of GBP1,198k from 30
June 2008. This is due to the Company entering into banking facilities with
Coutts & Co primarily to finance the remaining deferred consideration payments
arising from the acquisition of Purple Enterprises Limited, its smaller
acquisitions during the period, its investment in brand development, in
particular digital, and its working capital requirements.
Gross borrowings under these facilities were GBP1,355k as at 31 December 2009,
with GBP309k falling due for repayment in the next 12 months.
Consolidated Balance Sheet
Goodwill and other intangible assets have a net book value of GBP6,532k as at 31
December 2009, an increase of GBP140k from 30 June 2008. This increase is due to
the effect of the intangible assets arising on acquisitions and development
during the period net of the amortisation provided in the year of GBP1,002k.
The deferred taxation provision of GBP1,320k arises as a result of the
requirement under IFRS to provide for deferred taxation on intangible assets
arising on acquisition. In accordance with its accounting policy the Group has
not recognised a deferred tax asset on its accumulated trading losses which are
GBP3,469k.
Pro-forma results for the year ending 31 December 2009
Key figures on a calendar year basis are as follows:-
+---------------------------------------+----------+----------+
| | Year | Year |
| | ended 31 | ended 31 |
| | December | December |
| | 2009 | 2008 |
| | GBP'000 | GBP'000 |
+---------------------------------------+----------+----------+
| Gross Income | 6,160 | 1,241 |
+---------------------------------------+----------+----------+
| Revenue | 2,828 | 1,241 |
+---------------------------------------+----------+----------+
| Gross profit | 1,636 | 929 |
+---------------------------------------+----------+----------+
| EBITDA | 380 | (239) |
+---------------------------------------+----------+----------+
Consolidated Statement of Comprehensive Income
+---+------------------------------------+-----+-------------+-------------+
| | | | 18 | 12 |
| | | | months | months |
| | | | to | to |
+---+------------------------------------+-----+-------------+-------------+
| | | | 31 | 30 June |
| | | | December | |
+---+------------------------------------+-----+-------------+-------------+
| | | | 2009 | 2008 |
+---+------------------------------------+-----+-------------+-------------+
| | | | GBP | GBP |
+---+------------------------------------+-----+-------------+-------------+
| | | | | |
+---+------------------------------------+-----+-------------+-------------+
| Gross income | | 6,689,557 | 1,589,585 |
+----------------------------------------+-----+-------------+-------------+
| Revenue | | 3,357,326 | 1,589,585 |
+----------------------------------------+-----+-------------+-------------+
| Cost of sales | | (1,319,874) | (664,050) |
+----------------------------------------+-----+-------------+-------------+
| Gross profit | | 2,037,452 | 925,535 |
+----------------------------------------+-----+-------------+-------------+
| Operating expenses | | (1,834,996) | (1,175,459) |
+----------------------------------------+-----+-------------+-------------+
| Earnings before interest, tax, | | 202,456 | (249,924) |
| depreciation, amortisation, | | | |
| share-based payment costs and | | | |
| exceptional items | | | |
+----------------------------------------+-----+-------------+-------------+
| Depreciation | | (24,386) | (9,201) |
+----------------------------------------+-----+-------------+-------------+
| Share-based payment costs | | (69,150) | (46,867) |
+----------------------------------------+-----+-------------+-------------+
| Exceptional items | | (364,141) | (74,569) |
+----------------------------------------+-----+-------------+-------------+
| Amortisation of intangible assets | | (1,002,377) | (531,549) |
+----------------------------------------+-----+-------------+-------------+
| Total administrative costs | | (3,295,050) | (1,837,645) |
+----------------------------------------+-----+-------------+-------------+
| Operating loss | | (1,257,598) | (912,110) |
+----------------------------------------+-----+-------------+-------------+
| Interest charged | | (125,707) | (104,749) |
+----------------------------------------+-----+-------------+-------------+
| Interest received | | 1,125 | 22,439 |
+----------------------------------------+-----+-------------+-------------+
| Loss before income tax | | (1,382,180) | (994,420) |
+----------------------------------------+-----+-------------+-------------+
| Income tax credit | | 261,346 | 146,279 |
+----------------------------------------+-----+-------------+-------------+
| Loss after tax | | (1,120,834) | (848,141) |
+----------------------------------------+-----+-------------+-------------+
| Other comprehensive income | | - | - |
+----------------------------------------+-----+-------------+-------------+
| Total comprehensive loss for the | | (1,120,834) | (848,141) |
| period | | | |
+----------------------------------------+-----+-------------+-------------+
| Profit attributable to minority | | 16,186 | - |
| interests | | | |
+----------------------------------------+-----+-------------+-------------+
| Loss attributable to parent's equity | | (1,137,020) | (848,141) |
| holders | | | |
+----------------------------------------+-----+-------------+-------------+
| | | | | |
+---+------------------------------------+-----+-------------+-------------+
| Basic loss per share total and | | (3.5) | (3.5) |
| continuing | | | |
+----------------------------------------+-----+-------------+-------------+
| Diluted loss per share total and | | (3.5) | (3.5) |
| continuing | | | |
+---+------------------------------------+-----+-------------+-------------+
Consolidated Statement of Financial Position
Company number: 3735898
+---+------------------------------------+-----+-------------+-------------+
| | | | as at | as at |
+---+------------------------------------+-----+-------------+-------------+
| | | | 31 | 30 June |
| | | | December | |
+---+------------------------------------+-----+-------------+-------------+
| | | | 2009 | 2008 |
+---+------------------------------------+-----+-------------+-------------+
| | | | GBP | GBP |
+---+------------------------------------+-----+-------------+-------------+
| ASSETS | | | |
+----------------------------------------+-----+-------------+-------------+
| Non-current assets | | | |
+----------------------------------------+-----+-------------+-------------+
| Property, plant and equipment | | 43,404 | 61,621 |
+----------------------------------------+-----+-------------+-------------+
| Goodwill | | 1,300,425 | 1,174,493 |
+----------------------------------------+-----+-------------+-------------+
| Other intangible assets | | 5,231,458 | 5,217,091 |
+----------------------------------------+-----+-------------+-------------+
| | | | 6,575,287 | 6,453,205 |
+---+------------------------------------+-----+-------------+-------------+
| Current assets | | | |
+----------------------------------------+-----+-------------+-------------+
| Inventories | | 243,126 | 171,741 |
+----------------------------------------+-----+-------------+-------------+
| Trade and other receivables | | 935,593 | 418,802 |
+----------------------------------------+-----+-------------+-------------+
| Cash and cash equivalents | | 620,735 | 463,922 |
+----------------------------------------+-----+-------------+-------------+
| | | | 1,799,454 | 1,054,465 |
+---+------------------------------------+-----+-------------+-------------+
| Total assets | | 8,374,741 | 7,507,670 |
+----------------------------------------+-----+-------------+-------------+
| | | | |
+----------------------------------------+-----+-------------+-------------+
| LIABILITIES | | | |
+----------------------------------------+-----+-------------+-------------+
| Current liabilities | | | |
+----------------------------------------+-----+-------------+-------------+
| Trade and other payables | | (751,287) | (1,498,044) |
+----------------------------------------+-----+-------------+-------------+
| Current portion of long term | | (309,260) | - |
| borrowings | | | |
+----------------------------------------+-----+-------------+-------------+
| | | | (1,060,547) | (1,498,044) |
+---+------------------------------------+-----+-------------+-------------+
| Non-current liabilities | | | |
+----------------------------------------+-----+-------------+-------------+
| Deferred consideration | | (51,000) | (356,126) |
+----------------------------------------+-----+-------------+-------------+
| Deferred tax liabilities | | (1,320,468) | (1,450,031) |
+----------------------------------------+-----+-------------+-------------+
| Long term borrowings | | (1,045,505) | - |
+----------------------------------------+-----+-------------+-------------+
| | | | (2,416,973) | (1,806,157) |
+---+------------------------------------+-----+-------------+-------------+
| Total liabilities | | (3,477,520) | (3,304,201) |
+----------------------------------------+-----+-------------+-------------+
| | | | |
+----------------------------------------+-----+-------------+-------------+
| Net assets | | 4,897,221 | 4,203,469 |
+----------------------------------------+-----+-------------+-------------+
| | | | | |
+---+------------------------------------+-----+-------------+-------------+
| EQUITY | | | |
+----------------------------------------+-----+-------------+-------------+
| Attributable to the equity holders of | | | |
| the Company | | | |
+----------------------------------------+-----+-------------+-------------+
| Share capital | | 5,142,708 | 4,905,208 |
+----------------------------------------+-----+-------------+-------------+
| Share premium account | | 5,519,046 | 3,969,411 |
+----------------------------------------+-----+-------------+-------------+
| Profit and loss account | | (5,739,020) | (4,671,150) |
+----------------------------------------+-----+-------------+-------------+
| Total shareholders equity | | 4,922,734 | 4,203,469 |
+----------------------------------------+-----+-------------+-------------+
| Minority interest in equity | | (25,513) | - |
+----------------------------------------+-----+-------------+-------------+
| Total equity | | 4,897,221 | 4,203,469 |
+---+------------------------------------+-----+-------------+-------------+
Consolidated Statement of Changes in Equity
+---+--------------------+----------+------------+------------+-----------+-------------+-------------+
| | | | Share | Share | Minority | Profit | Total |
| | | | capital | premium | interest | & loss | equity |
| | | | | account | | account | |
+---+--------------------+----------+------------+------------+-----------+-------------+-------------+
| | | | GBP | GBP | GBP | GBP | GBP |
+---+--------------------+----------+------------+------------+-----------+-------------+-------------+
| | | | | | | | |
+---+--------------------+----------+------------+------------+-----------+-------------+-------------+
| Balance as at 1 July | | 4,905,208 | 3,979,411 | - | (3,908,733) | 4,975,886 |
| 2007 | | | | | | |
+------------------------+----------+------------+------------+-----------+-------------+-------------+
| Transactions with | | | | | | |
| owners | | | | | | |
+------------------------+----------+------------+------------+-----------+-------------+-------------+
| | Cost of | | - | (10,000) | - | - | (10,000) |
| | consolidation of | | | | | | |
| | share capital | | | | | | |
+---+--------------------+----------+------------+------------+-----------+-------------+-------------+
| | Share-based | | - | - | - | 85,724 | 85,724 |
| | payment costs | | | | | | |
+---+--------------------+----------+------------+------------+-----------+-------------+-------------+
| | | | - | (10,000) | - | 85,724 | 75,724 |
+---+--------------------+----------+------------+------------+-----------+-------------+-------------+
| | Loss and total | | - | - | - | (848,141) | (848,141) |
| | comprehensive loss | | | | | | |
| | for the period | | | | | | |
+---+--------------------+----------+------------+------------+-----------+-------------+-------------+
| Balance at 30 June | | 4,905,208 | 3,969,411 | - | (4,671,150) | 4,203,469 |
| 2008 | | | | | | |
+------------------------+----------+------------+------------+-----------+-------------+-------------+
| | | | | | | | |
+---+--------------------+----------+------------+------------+-----------+-------------+-------------+
| Transactions with | | | | | | |
| owners | | | | | | |
+------------------------+----------+------------+------------+-----------+-------------+-------------+
| | Issue of share | | 237,500 | 1,549,635 | - | - | 1,787,135 |
| | capital | | | | | | |
+---+--------------------+----------+------------+------------+-----------+-------------+-------------+
| | Share-based | | - | - | - | 69,150 | 69,150 |
| | payment costs | | | | | | |
+---+--------------------+----------+------------+------------+-----------+-------------+-------------+
| | Minority interest | | - | - | (41,699) | - | (41,699) |
| | acquired | | | | | | |
+---+--------------------+----------+------------+------------+-----------+-------------+-------------+
| | | | 237,500 | 1,549,635 | (41,699) | 69,150 | 1,814,586 |
+---+--------------------+----------+------------+------------+-----------+-------------+-------------+
| | Loss and total | | - | - | 16,186 | (1,137,020) | (1,120,834) |
| | comprehensive loss | | | | | | |
| | for the period | | | | | | |
+---+--------------------+----------+------------+------------+-----------+-------------+-------------+
| Balance as at 31 | | 5,142,708 | 5,519,046 | (25,513) | (5,739,020) | 4,897,221 |
| December 2009 | | | | | | |
+---+--------------------+----------+------------+------------+-----------+-------------+-------------+
Consolidated Statement of Cash Flows
+---+------------------------------------+-----+-------------+-----------+
| | | | 18 | 12 |
| | | | months | months |
| | | | to | to |
+---+------------------------------------+-----+-------------+-----------+
| | | | 31 | 30 June |
| | | | December | |
+---+------------------------------------+-----+-------------+-----------+
| | | | 2009 | 2008 |
+---+------------------------------------+-----+-------------+-----------+
| | | | GBP | GBP |
+---+------------------------------------+-----+-------------+-----------+
| Cash flows from operating activities | | | |
+----------------------------------------+-----+-------------+-----------+
| Loss before taxation | | (1,382,180) | (994,420) |
+----------------------------------------+-----+-------------+-----------+
| Adjustments for: | | | |
+----------------------------------------+-----+-------------+-----------+
| | Depreciation | | 24,386 | 9,201 |
+---+------------------------------------+-----+-------------+-----------+
| | Amortisation of intangible assets | | 1,002,377 | 531,549 |
+---+------------------------------------+-----+-------------+-----------+
| | Share-based payment costs | | 69,150 | 46,867 |
+---+------------------------------------+-----+-------------+-----------+
| | Interest expense | | 124,582 | 82,310 |
+---+------------------------------------+-----+-------------+-----------+
| | (Increase)/Decrease in inventories | | (71,385) | 254,218 |
+---+------------------------------------+-----+-------------+-----------+
| | (Increase)/Decrease in trade and | | (516,791) | 29,124 |
| | other receivables | | | |
+---+------------------------------------+-----+-------------+-----------+
| | (Decrease)/Increase in trade | | (10,487) | (438,948) |
| | payables | | | |
+---+------------------------------------+-----+-------------+-----------+
| Cash absorbed by operations | | (760,348) | (480,099) |
+----------------------------------------+-----+-------------+-----------+
| Interest paid | | (46,536) | (200) |
+----------------------------------------+-----+-------------+-----------+
| Income taxes paid | | (6,609) | - |
+----------------------------------------+-----+-------------+-----------+
| Net cash absorbed by operating | | (813,493) | (480,299) |
| activities | | | |
+----------------------------------------+-----+-------------+-----------+
| | | | | |
+---+------------------------------------+-----+-------------+-----------+
| Cash flows from investing activities | | | |
+----------------------------------------+-----+-------------+-----------+
| Acquisition of subsidiaries, net of | | (1,600,452) | (381,833) |
| cash acquired | | | |
+----------------------------------------+-----+-------------+-----------+
| Purchase of property, plant and | | (6,169) | (56,551) |
| equipment | | | |
+----------------------------------------+-----+-------------+-----------+
| Purchase of other intangible assets | | (221,236) | - |
+----------------------------------------+-----+-------------+-----------+
| Television production | | (324,862) | - |
+----------------------------------------+-----+-------------+-----------+
| Interest received | | 1,125 | 22,439 |
+----------------------------------------+-----+-------------+-----------+
| Net cash absorbed by investing | | (2,151,594) | (415,945) |
| activities | | | |
+----------------------------------------+-----+-------------+-----------+
| | | | | |
+---+------------------------------------+-----+-------------+-----------+
| Cash flows from financing activities | | | |
+----------------------------------------+-----+-------------+-----------+
| Proceeds from issue of share capital | | 1,900,000 | - |
+----------------------------------------+-----+-------------+-----------+
| Share issue costs | | (112,865) | (10,000) |
+----------------------------------------+-----+-------------+-----------+
| Preference shares redeemed | | (20,000) | - |
+----------------------------------------+-----+-------------+-----------+
| Bank facility utilisation | | 1,354,765 | - |
+----------------------------------------+-----+-------------+-----------+
| Net cash generated by/(used in) | | 3,121,900 | (10,000) |
| financing activities | | | |
+----------------------------------------+-----+-------------+-----------+
| | | | | |
+---+------------------------------------+-----+-------------+-----------+
| Net increase/(decrease) in cash and | | 156,813 | (906,244) |
| cash equivalents | | | |
+----------------------------------------+-----+-------------+-----------+
| Cash and cash equivalents at beginning | | 463,922 | 1,370,166 |
| of period | | | |
+----------------------------------------+-----+-------------+-----------+
| Cash and cash equivalents at end of | | 620,735 | 463,922 |
| period | | | |
+---+------------------------------------+-----+-------------+-----------+
Principal Accounting Policies
General
The directors approved this preliminary announcement on 24th March 2010.
Those financial statements have not yet been delivered to the registrar of
companies, nor have the auditors reported on them. Copies of the annual report
will shortly be posted to shareholders and copies will be available from the
company's registered office at 48 Broadley Terrace, London NW1 6LG.
Nature of operations and general information
Coolabi plc is the Group's ultimate parent company. It is incorporated and
domiciled in England. Coolabi plc's shares are listed on the Alternative
Investment Market of the London Stock Exchange.
In September 2009 the group elected to change its accounting reference date from
30 June to 31 December with immediate effect, in order to improve the usefulness
of the Group's financial statements. The current period encompasses 18 months
and the previous period 12 months - the figures presented in these statements
are therefore not directly comparable.
Coolabi plc's consolidated financial statements are presented in Pounds Sterling
(GBP), which is also the functional currency of the parent company.
Basis of preparation
These consolidated financial statements have been prepared in accordance with
International Financial Reporting Standards as adopted by the European Union.
The financial statements have been prepared using the measurement bases
specified by IFRS for each type of asset, liability, income and expense. The
measurement bases are more fully described in the accounting policies below and
are in accordance with the Companies Act 2006 and applicable International
Financial Reporting Standards.
The Group has elected to adopt IAS1 Presentation of Financial Statements
(revised 2007). This impacts only the presentation of the Group's financial
statements - consequently the board has elected not to show a restatement of the
prior year position. There are no changes to the balance sheet as a result of
new accounting policies or otherwise.
At the date of authorisation of these financial statements, the following
Standards and Interpretations which have not been applied in these financial
statements were in issue but not yet effective:
+-----------------------------------------------------------------+
| · IASB Improvements Project (effective for financial years |
| commencing 1 July 2009 or 1 January 2010) |
+-----------------------------------------------------------------+
| · IFRS 2 (Amendment): Group Cash-settled Share-based |
| Payment Transactions (effective for financial years commencing |
| 1 January 2010) |
+-----------------------------------------------------------------+
| · IAS 39 (Amendment): Financial Instruments: Recognition |
| and Measurement: Eligible Hedged Items (effective for financial |
| years commencing 1 July 2009) |
+-----------------------------------------------------------------+
| · IFRS 3 (Revised): Business Combinations (effective for |
| financial years commencing 1 July 2009) |
+-----------------------------------------------------------------+
| · IFRS 8: Operating Segments (effective for financial |
| years commencing 1 January 2009) |
+-----------------------------------------------------------------+
| · IAS 27 (Amendment): Consolidated and Separate Financial |
| Statements (effective for financial years commencing 1 July |
| 2009) |
+-----------------------------------------------------------------+
| · IFRIC 17: Distribution of Non-cash Assets to Owners |
| (effective for financial years commencing 1 November 2009) |
+-----------------------------------------------------------------+
| · IFRIC 18: Transfers of Assets from Customers (effective |
| for financial years commencing 1 November 2009) |
+-----------------------------------------------------------------+
The directors anticipate that the adoption of these Standards and
Interpretations in future periods will have no material impact on the
consolidated financial statements of the Group as reported except for additional
disclosures. The accounting policies have been applied consistently throughout
the Group for the purposes of preparation of these consolidated financial
statements.
The Group has elected not to adopt IFRS 8 early, although to do so would have no
material impact upon the disclosures presented in these statements.
Basis of consolidation
The Group financial statements consolidate those of the Company and all of its
subsidiary undertakings drawn up to 31 December 2009. Subsidiaries are entities
over which the Group has the power to control the financial and operating
policies so as to obtain benefits from its activities. The Group obtains and
exercises control through voting rights.
Unrealised gains on transactions between the Group and its subsidiaries are
eliminated. Unrealised losses are also eliminated unless the transaction
provides evidence of an impairment of the asset transferred. Amounts reported in
the financial statements of subsidiaries have been adjusted where necessary to
ensure consistency with the accounting policies adopted by the Group.
Acquisitions of subsidiaries are dealt with by the purchase method. The purchase
method involves the recognition at fair value of all identifiable assets and
liabilities, including contingent liabilities of the subsidiary, at the
acquisition date, regardless of whether or not they were recorded in the
financial statements of the subsidiary prior to acquisition. On initial
recognition, the assets and liabilities of the subsidiary are included in the
consolidated balance sheet at their fair values, which are also used as the
bases for subsequent measurement in accordance with the Group accounting
policies. Goodwill is stated after separating out identifiable intangible
assets. Goodwill represents the excess of acquisition cost over the fair value
of the Group's share of the identifiable net assets of the acquired subsidiary
at the date of acquisition.
Business combinations completed prior to date of transition to IFRS
The Group has elected not to apply IFRS 3 Business Combinations retrospectively
to business combinations prior to 1 July 2006.
Accordingly, the classification of the combination (acquisition, reverse
acquisition or merger) remains unchanged from that used under UK GAAP. Assets
and liabilities are recognised at date of transition if they would be recognised
under IFRS, and are measured using their UK GAAP carrying amount immediately
post-acquisition as deemed cost under IFRS, unless IFRS requires fair value
measurement. Deferred tax and minority interest are adjusted for the impact of
any consequential adjustments after taking advantage of the transitional
provisions.
The transitional provisions used for past business combinations apply equally to
past acquisitions of interests in associates and joint ventures.
Accounting estimates and judgements
The preparation of consolidated financial statements under IFRS requires the
Group to make estimates and assumptions that effect the application of policies
and reported amounts. Estimates and judgements are based on historical
experience and other factors including expectations of future events that are
believed to be reasonable under the circumstances. Actual results may differ
from these estimates. The estimates and assumptions which have a significant
risk of causing a material adjustment to the carrying amount of assets and
liabilities are discussed below.
Intangible assets
The Group recognises intangible assets acquired as part of business combinations
at fair value at the date of acquisition. The determination of these fair values
is based upon management's judgement and includes assumptions on the timing and
amount of future incremental cash flows generated by the assets and selection of
an appropriate cost of capital. Furthermore, management must estimate the
expected useful lives of intangible assets and charge amortisation on these
assets accordingly.
Impairment of goodwill
The Group is required to test, at least annually, whether goodwill has suffered
any impairment. The recoverable amount is determined according to its estimated
value in use. The use of this method may require the estimation of future cash
flows and the choice of a suitable discount rate in order to calculate the
present value of these cash flows.
Deferred and contingent consideration
Where deferred consideration is payable in cash and discounting would have a
material effect the liability is discounted to its present value. Where the
deferred consideration is contingent and dependent upon future trading
performance, an estimate of the present value of the likely consideration
payable is made.
Revenue
Licensing and merchandising
Non-refundable advances are recognised upon contract signature. Royalties earned
in excess of such advances are recognised in the period to which they relate.
Film and television
Licence fees are recognised when a licence agreement has been signed by both
parties, and delivery to the broadcaster has occurred.
Gross income
Gross income represents the sum of Revenue, as above, and the film and
television licence fees received or receivable by the Group's contracted
co-production partners. This is included to provide full understanding of the
activity of the Group during the period.
Programme investments
Programme investments represent costs of production and are included as
intangible fixed assets. The amount held on the balance sheet is the lower of
the amount of anticipated future ancillary revenues and the amortised cost of
the investment.
Intangible assets
Goodwill and intangible assets acquired through business combinations
Goodwill representing the excess of the cost of acquisition over the fair value
of the Group's share of the identifiable net assets acquired is capitalised and
reviewed annually for impairment in accordance with IAS 36. The fair value of
intangible assets acquired as a result of business combinations are capitalised
and amortised on a straight line basis through the income statement. The rates
applied, which represent the directors' best estimate of the useful economic
lives, are:
+--------------------+---------------------+
| Contracts | Life of the |
| | contract |
+--------------------+---------------------+
| Brand and | 10 years |
| relationships | |
+--------------------+---------------------+
Digital assets
Digital assets, including websites and digital applications, are capitalised at
cost and amortised on a straight line basis through the income statement. The
rates applied, which represent the directors' best estimate of the useful
economic lives, are:
+-------------------------+-----------------+
| Digital assets | 3 years |
+-------------------------+-----------------+
| Websites | 3 years |
+-------------------------+-----------------+
Material residual value estimates are updated as required, but at least
annually, whether or not the asset is revalued.
Television Production
Production costs included in intangible assets are amortised against ancillary
income associated with the production.
Property, plant and equipment
Property, plant and equipment is stated at cost, net of depreciation and any
provision for impairment.
Depreciation is calculated to write down the cost less estimated residual value
of plant and equipment by equal annual instalments over their estimated useful
economic lives. The rates generally applicable are:
+-------------------------+-----------------+
| Computer Equipment | 33% |
+-------------------------+-----------------+
| Furniture, Fittings & | 20% |
| Equipment | |
+-------------------------+-----------------+
| Brand Style Guides | 20% |
+-------------------------+-----------------+
Material residual value estimates are updated as required, but at least
annually, whether or not the asset is revalued.
Operating lease agreements
Leases where substantially all of the risks and rewards of ownership are not
transferred to the Group are treated as operating leases. Rentals under
operating leases are charged against profits on a straight line basis over the
period of the lease.
Inventories
These costs represent expenditure on projects in development, valued at the
lower of cost and net realisable value. Licensed product held for resale is
valued at the lower of cost or net realisable value, after making allowance for
obsolete and slow moving items.
Financial instruments
Financial assets and liabilities are recognised on the Group's balance sheet
when the Group becomes a party to the contractual provisions of the instrument.
Financial assets
The Group's financial assets comprise trade and other receivables. Trade and
other receivables are recorded at their nominal value less any provision for
impairment, based on the receivable ageing, the Group's previous experience with
the debtor and known market intelligence. Any change in their value is
recognised in the income statement.
Financial liabilities
The Group's financial liabilities comprise borrowings, trade and other payables.
They are classified and accounted for according to the substance of the
contractual arrangement entered into, and stated at their nominal value. All
interest-related charges and, if applicable, changes in the instrument's nominal
value are included in the income statement line items "interest charged" or
"interest received".
Exceptional items
Items of significant income or expenditure which are one-off transactions are
classed as exceptional on the face of the income statement, to show more
accurately the underlying performance of the Group.
Impairment testing of goodwill, other intangible assets and property, plant and
equipment
For the purposes of assessing impairment, assets are grouped at the lowest
levels for which there are separately identifiable cash flows (cash-generating
units). As a result, some assets are tested individually for impairment and
some are tested at cash-generating unit level. Goodwill is allocated to those
cash-generating units that are expected to benefit from synergies of the related
business combination and represent the lowest level within the Group at which
management monitors the related cash flows.
Goodwill, other individual assets or cash-generating units that include
goodwill, other intangible assets with an indefinite useful life, and those
intangible assets not yet available for use are tested for impairment at least
annually. All other individual assets or cash-generating units are tested for
impairment whenever events or changes in circumstances indicate that the
carrying amount may not be recoverable.
An impairment loss is recognised for the amount by which the assets' or
cash-generating unit's carrying amount exceeds its recoverable amount. The
recoverable amount is the higher of fair value, reflecting market conditions
less costs to sell, and value in use based on an internal discounted cash flow
evaluation. Impairment losses recognised for cash-generating units, to which
goodwill has been allocated, are credited initially to the carrying amount of
goodwill. Any remaining impairment loss is charged pro rata to the other assets
in the cash generating unit. With the exception of goodwill, all assets are
subsequently reassessed for indications that an impairment loss previously
recognised may no longer exist.
Sale and leaseback transactions
Where film and television assets have been partly financed via sale and
leaseback arrangements, the proceeds of the sale of the master negative, and the
corresponding loan obligation in respect of the lease rental commitment over the
period of the lease, are shown by way of a note to the accounts as it is
considered that this properly reflects the nature of the transaction as a
refinancing of the original production costs, as the risks and rewards of
ownership have been retained by the Company. Under IAS 39 "Financial
Instruments: Recognition & Measurement", each sale and leaseback transaction
entered into by the Group has, from inception, failed to meet the definition of
an asset and liability and has therefore not been recognised in these financial
statements. The Group has applied guidance from SIC-27 "Evaluating the Substance
of Transactions Involving the Legal Form of a Lease".
Taxation
Current tax is the tax currently payable based on taxable profit for the period.
Deferred income taxes are calculated using the liability method on temporary
differences. Deferred tax is generally provided on the difference between the
carrying amounts of assets and liabilities and their tax bases. However,
deferred tax is not provided on the initial recognition of goodwill, nor on the
initial recognition of an asset or liability unless the related transaction is a
business combination or affects tax or accounting profit. Deferred tax on
temporary differences associated with shares in subsidiaries and joint ventures
is not provided if reversal of these temporary differences can be controlled by
the Group and it is probable that reversal will not occur in the foreseeable
future. In addition, tax losses available to be carried forward as well as
other income tax credits to the Group are assessed for recognition as deferred
tax assets.
Deferred tax liabilities are provided in full, with no discounting. Deferred
tax assets are recognised to the extent that it is probable that the underlying
deductible temporary differences will be able to be offset against future
taxable income. Current and deferred tax assets and liabilities are calculated
at tax rates that are expected to apply to their respective period of
realisation, provided they are enacted or substantively enacted at the balance
sheet date.
Changes in deferred tax assets or liabilities are recognised as a component of
tax expense in the income statement, except where they relate to items that are
charged or credited directly to equity (such as the revaluation of land) in
which case the related deferred tax is also charged or credited directly to
equity.
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand.
Equity
Equity comprises the following:
· Share capital: the nominal value of equity shares.
· Share premium account: the excess over nominal value of the fair value of
consideration received for equity shares, net of expenses of the share issue.
· Shares to be issued: shares that have not yet been issued.
· Profit and loss account: retained profits.
Foreign currencies
Transactions in foreign currencies are translated at the exchange rate ruling at
the date of the transaction. Assets and liabilities in foreign currencies are
translated at the rates of exchange ruling at the balance sheet date. Exchange
differences are taken to the profit and loss account in arriving at the
operating result for the period.
Share-based payments
Equity settled share-based payments are measured at fair value (excluding the
impact of any non-market vesting conditions) at the date of grant. The fair
value determined at the grant date of the equity-settled share-based payments is
expensed on a straight line basis over the vesting period, based on the Group's
estimate of shares that will eventually vest and adjusted for the effect of non
market-based vesting conditions.
Fair value is measured by use of a binomial model. The expected life used in the
model has been adjusted, based on management's best estimate, for the effects of
non-transferability, restrictions on exercise and behavioural considerations.
Upon exercise of share options, the proceeds received net of attributable
transactions costs are credited to share capital and, where appropriate, share
premium.
The assumptions in respect of all options granted are based on:
· Volatility: determined by calculating the historical volatility of the
Company's share price over the previous year.
· Expected life: based on the average contractual life adjusted for
management's best estimate, for the effects of non-transferability, exercise
restrictions, and behavioural considerations.
· Risk-free rate of return: yield of a UK government gilt over the expected
life at the date of grant
Notes to the Consolidated Financial Statements
1. Earnings per share
The calculation of the basic earnings per share is based on the earnings
attributable to ordinary shareholders divided by the weighted average number of
shares in issue during the period.
The calculation of diluted earnings per share is based on the basic earnings per
share, adjusted to allow for the issue of shares and the post tax effect of
dividends and/or interest, on the assumed conversion of all dilutive options and
other dilutive potential ordinary shares. In view of the pricing of share
options currently in issue, these options are considered to have no dilutive
effect.
Reconciliations of the earnings and weighted average number of shares used in
the calculations are set out below:
+----------------------------------------+-------------+-------------+
| | 31 | 30 June |
| | December | |
+----------------------------------------+-------------+-------------+
| | 2009 | 2008 |
+----------------------------------------+-------------+-------------+
| | GBP | GBP |
+----------------------------------------+-------------+-------------+
| Loss for the period attributable to | (1,137,020) | (848,141) |
| the parent's equity holders | | |
+----------------------------------------+-------------+-------------+
| | | |
+----------------------------------------+-------------+-------------+
| Weighted average number of ordinary | 32,842,034 | 24,526,043 |
| shares in issue during the period | | |
+----------------------------------------+-------------+-------------+
| Basic EPS (pence) | (3.5) | (3.5) |
+----------------------------------------+-------------+-------------+
| | | |
+----------------------------------------+-------------+-------------+
| Weighted average number of ordinary | 32,842,034 | 24,526,043 |
| shares in issue or under option during | | |
| the period | | |
+----------------------------------------+-------------+-------------+
| Fully diluted EPS (pence) | (3.5) | (3.5) |
+----------------------------------------+-------------+-------------+
2. Publication of non-statutory accounts
The financial information set out in this preliminary announcement does not
constitute statutory accounts as defined in section 435 of the Companies Act
2006.
The summarised consolidated balance sheet at 31 December 2009 and the
summarised consolidated income statement, summarised consolidated cash flow
statement and associated notes for the year then ended have been extracted from
the Group's 2009 financial statements. Those financial statements have not yet
been delivered to the registrar of companies, nor have the auditors reported on
them.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR LLFEAVEISFII
Coolabi (LSE:COO)
過去 株価チャート
から 12 2024 まで 1 2025
Coolabi (LSE:COO)
過去 株価チャート
から 1 2024 まで 1 2025
