RNS Number:2369D
ResponzeTV PLC
04 September 2007
4 September 2007
ResponzeTV PLC
Interim Results 2007
ResponzeTV PLC today reports its interim figures for the six months to 30 June
2007:
Business Highlights:
*Major corporate, strategic and operational changes have established
foundations for success
*Early improvement in results are starting to show
*Two major US acquisitions completed and a new UK channel joint venture
launched
*Integration of product development and sourcing combined with
international distribution through infomercial and TV home shopping
distribution businesses
*Strong sales growth in the US and other major international markets from
sales offices in the US, Europe and Asia
*New products launched on infomercial and TV home shopping channels, with
a pipeline of further new products
Financial Highlights:
*Approx 1000% (11 times) sales growth
*Approx 1900% (20 times) improvement in gross profit
*Significant reduction in losses to US$360,000
*Operating profit of US$34,000
H1 2007 (US$) H1 2006 (US$) Approx Change
Sales 12.72m 1.16m 1000% (11x)
increase
Gross Profit 7.58m 0.37m 1900% (20x)
increase
Loss from continuing
operations (0.36)m (4.10)m 91% reduction
For further information, please contact:
ResponzeTV PLC
Steven Goodman, Executive Chairman
Tel: + 852 2295 1161
Evolution Securities Limited
Bobbie Hilliam
Tel: +44 207 071 4300
ResponzeTV PLC
Interim Results 2007
Review of Trading
In the first half, the focus was on the integration of Reliant and Famous
Discoveries, increasing distribution capability and the development and launch
of new products. As a result, the Group now develops and sources products
through its international supply business, and has international distribution
through its fully integrated infomercial and TV home shopping businesses.
Product launches have included the 'Pressa Bella Steam Iron', the 'Mirabella
Steam Mop', 'Tru Color Sunglasses' and a number of branded items such as Chef
Robert Irvine's kitchen products and the Professor Amos and 'Stainz-R-Out' lines
of cleaning products. The Tony Little branded 'Rock n Roll Stepper', which
started testing in June 2007, has launched to particularly successful early
results and is expected to generate significant revenues in the future. More
product launches are in the pipeline and the Company aims to have a continuing
flow of products at different stages of development.
International distribution now comprises Reliant's infomercial business, Famous
Discoveries' home shopping business and supplies of products to third party home
shopping operations in key markets in North America, Europe and Asia from sales
offices in the USA, Europe, Hong Kong and Taiwan. In the UK, additional
distribution is provided through the 'Shop Now TV' infomercial joint venture
channel. The Company has also established a joint venture with a TV home
shopping channel to provide infomercial distribution for its products in Canada,
and targets to enter into similar arrangements in other markets.
The Company is targeting to become a leader in the development and sourcing of
products, the production of media and the distribution of products on leading
infomercial and TV home shopping channels in the principal home shopping markets
around the world.
Senior Management Changes
The period saw a major strengthening of the senior management team. On
completion of the acquisition of Reliant in January 2007, Kevin Harrington and
Tim Harrington joined the Board as Group Chief Executive Officer and Group Chief
Operating Officer respectively. The senior management team was further
strengthened on the acquisition of Famous Discoveries in March 2007 by the
addition to the team of Akos Jankura and Bill Barlow. They each bring
significant experience and expertise in the infomercial and TV home shopping
industry.
Results for the Period
The above mentioned changes were instrumental in producing significantly
improved results for the period.
Turnover for the period, of US$12.72 million, represented an increase of
approximately 11 times on the US$1.16m achieved in the same period last year.
Gross profit for the period was US$7.58 million, an increase of approximately 20
times on the US$370,000 achieved for the same period last year.
The loss for the period of US$360,000 represents an approximate 91% reduction on
the US$4.10m loss for the same period last year.
The Group achieved an operating profit for the period (excluding finance costs)
of US$34,000, compared to a US$2.75m loss in the same period last year.
A significant part of these improvements reflects the contributions of Reliant
and Famous Discoveries, although the period also saw continued improvement in
the International Supply business. Each of these businesses have benefited from
being brought together. The launch of the new UK Channel 'Shop Now TV' at
end-May 2007 was too late to make a meaningful impact on results in the first
half, but is expected to contribute to further sales growth in the second half
of the year.
These improvements have taken place during the initial period of integration of
the new businesses, developing the Group's distribution capability and focusing
on the development of new products and projects for launch in 2007 and beyond.
As the Company moves through this initial integration and development phase and
into a period of focusing on further sales growth, the Board expects to see
continuing improvement in results for the rest of 2007 and into 2008.
Current Trading and Prospects
The Board anticipates that trading in the second half will continue to show
further improvement.
ResponzeTV PLC
CONSOLIDATED INCOME STATEMENT
Unaudited six Unaudited six Year to
months to 30 months to 30 31 December
June 2007 June 2006 2006
US$'000 US$'000 US$'000
Revenue 12,718 1,164 2,174
Cost of sales (5,143) (797) (2,001)
----------- ---------- -----------
Gross profit 7,575 367 173
Administrative
expenses (1,229) (2,716) (4,240)
Distribution
expenses (6,312) (401) (688)
----------- ---------- -----------
Operating
profit/(loss) 34 (2,750) (4,755)
Share of losses of associates - - -
Investment
revenue 1 1 2
Finance income - - 3,177
Finance costs (396) (1,347) (2,580)
----------- ---------- -----------
Loss before tax (361) (4,096) (4,156)
Income tax - - -
----------- ---------- -----------
Loss from
continuing
operations (361) (4,096) (4,156)
----------- ---------- -----------
Loss for the
financial
period/ year (361) (4,096) (4,156)
=========== ========== ===========
Basic/ diluted loss per ordinary US$(0.01) US$(0.52) US$(0.49)
share =========== ========== ===========
ResponzeTV PLC
CONSOLIDATED BALANCE SHEET
Unaudited 30 Unaudited 30 31 December
June 2007 June 2006 2006
----------------------- ----------------------- ------------------
US$'000 US$'000 US$'000
ASSETS
Non-Current assets:
Property,
plant and
equipment 85 131 142
Intangible
assets 598 - -
Goodwill 26,873 - -
------------ ------------ ------------
Total
non-current
assets 27,556 131 142
------------ ------------ ------------
Current assets:
Inventories 410 268 -
Trade and
other
receivables 2,368 361 1,008
Cash and cash
equivalents (12) 332 189
------------ ------------ ------------
Total current
assets 2,766 961 1,197
------------ ------------ ------------
Total Assets 30,322 1,092 1,339
LIABILITIES
Current liabilities:
Trade and
other payables (5,604) (6,483) (2,793)
Tax liabilities (68) (63) (68)
Other
financial
liabilities (6,624) (13,860) (3,619)
------------ ------------ ------------
Total current
liabilities (12,296) (20,406) (6,480)
------------ ------------ ------------
Non-current liabilities:
Other
financial
liabilities (3,946) (8,100) (3,132)
------------ ------------ ------------
Total
non-current
liabilities (3,946) (8,100) (3,132)
------------ ------------ ------------
Total
Liabilities (16,242) (28,506) (9,612)
------------ ------------ ------------
Total Assets
less Total
Liabilities 14,080 (27,414) (8,273)
============ ============ ============
EQUITY
Share capital 23,578 2,155 16,853
Equity
component of
convertible
bond 665 323 665
Deferred
shares on
acquisition 12,430 - -
Share premium
account 9,781 - 7,058
Other reserve 94 - 11
Translation
reserve (5,567) (3,413) (6,321)
Accumulated
losses (26,901) (26,479) (26,539)
------------ ------------ ------------
Total Equity 14,080 (27,414) (8,273)
============ ============ ============
ResponzeTV PLC
----------------------------------------------
Consolidated cash flow statement
for the period ended 30 June 2006
Unaudited six Unaudited six Year to 31
months to 30 months to 30 December 2006
June 2007 June 2006
US$'000 US$'000 US$'000
Operating activities
Loss for the
period/year (361) (4,096) (4,156)
Adjustments for:
Loss on disposal of property, plant and equipment 5 - 356
Depreciation of property, plant and equipment 46 99 168
Impairment of property, plant and equipment - 435
(Write back of) provision on inventories - - (153)
Impairment of goodwill - 99 55
Share -based payment expense 83 - 11
Finance income - - (3,177)
Finance costs 396 1,347 2,580
Interest receivables (1) (1) (2)
-------- -------- ---------
Operating cash
flows before
movements in
working
capital 168 (2,117) (162)
(Increase)/
decrease in
inventories (96) 164 635
(Increase)/
decrease in
receivables (604) 374 72
Decrease in
payables (3,401) (1,386) (2,466)
-------- -------- ---------
Cash generated
from
operations (3,933) (2,965) (1,759)
Income taxes refunded (paid) - - -
Interest paid (90) (90) (180)
-------- -------- ---------
Net cash from
operating
activities (4,023) (3,055) (6,257)
-------- -------- ---------
Investing activities
Interest
received 1 1 2
Acquisition of
subsidiary (138) (99) (77)
Disposal of
property,
plant and
equipment - - 33
Purchases of
property,
plant and
equipment (28) (60) (79)
-------- -------- ---------
Net cash from
investing
activities (165) (158) (121)
-------- -------- ---------
Financing activities
Proceeds of
capital
reorganization 95 - -
Issue of new
shares - - 252
New other
loans raised 3,196 4,100 6,600
Repayment of
loans (57) - -
-------- -------- ---------
Net cash from
financing
activities 3,234 4,100 6,852
-------- -------- ---------
Net
(decrease)/
increase in
cash and cash
equivalents (954) 887 474
Cash and cash
equivalents at
the beginning
of the period/
year 189 257 257
Effect of
foreign
exchange rate
changes 753 (812) (542)
-------- -------- ---------
Cash and cash
equivalents at
the end of the
period/ year (12) 332 189
======== ======== =========
ResponzeTV PLC
----------------
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE PERIOD/ YEAR
Unaudited six Unaudited six Year to 31
months to 30 months to 30 December 2006
June 2007 June 2006 --------------------
-------------------- --------------------
US$'000 US$'000 US$'000
Changes in equity
Exchange
differences
arising on
translation of
foreign
operations 753 (812) (3,720)
----------- ----------- -----------
Net income
recognized
directly in
equity 753 (812) (3,720)
Loss for the
period/year (361) (4,096) (4,156)
----------- ----------- -----------
Total
recognized
income and
expense for
the
period/year 392 (4,908) (7,876)
Issue of share
capital 6,677 - 119
Issue of share
capital upon
conversion of
debts 48 - 14,579
Equity element
of convertible
loan - issue
of convertible
debt - - 403
Equity element
of convertible
loan -
conversion of
debt - - (61)
Share premium
arising from
capital
reorganization 95 - -
Share premium
arising from
the issue of
ordinary share
capital 2,576 - 133
Share premium
arising from
conversion of
debts 52 - 6,925
Issue of share
options 83 - 11
Deferred
shares on
acquisition 12,430
----------- ----------- -----------
22,353 (4,908) 14,233
Equity brought
forward (8,273) (22,506) (22,506)
----------- ----------- -----------
Equity carried
forward 14,080 (27,414) (8,273)
=========== =========== ===========
Notes to the Accounts
The interim results to 30 June 2007 have been prepared on the same basis and
under the same accounting policies as were applicable and set out in the
accounts for the year ended 31 December 2006. Specifically, the interim results
have been prepared in accordance with International Financial Reporting
Standards, International Accounting Standards and Interpretations (collectively
"IFRS") as adopted by the EU and with those parts of the Companies Act 1985
applicable to companies preparing their financial statements under IFRS.
The financial information in the report does not constitute full accounts
defined by section 240 of the Companies Act 1985. The figures for the year ended
31 December 2006 are based on the accounts, which have been filed with the
Registrar of Companies. The auditors report on the accounts, as filed with the
Registrar of Companies, was unqualified.
Presentational Currency - under IAS 21 the US$ represents the currency of the
primary economic environment which operates on a company by company basis and
all subsidiaries have adopted the US$ as their functional currency. The Group
therefore, has adopted the US$ as the presentational currency when reporting all
financial statements.
Seasonality - the period under review has not been subject to any unusual
influence of seasonality or cyclicality.
Going Concern - the directors believe that continued financial support to the
Group will be provided by MediaXposure Limited (Cayman) ("MediaXposure") and on
this view the directors consider it appropriate to prepare the interim results
statements on a going concern basis.
Financing - during the period the Company borrowed a further US$200,000 from
MediaXposure. On 19 January 2007, the Company's subsidiary Reliant International
Media LLC ("Reliant") agreed a US$2.0m line of credit with Grand Pacific Finance
Corporation. On 1 April 2007, this facility was increased by a further US$1.0m.
Business combinations - on 11 January 2007 the company acquired 100% of the
shares of Reliant, a TV Infomercial producer based in the USA. The Company
issued to the vendors 13,620,551 new ordinary shares. On 31 May 2007, the
Company issued a further 4,540,184 new ordinary shares to the vendors. The issue
of a balance of up to 26,415,614 new ordinary shares will be by way of earn-out
and is dependant on the financial performance of Reliant for the financial years
ending 31 December 2007 and 31 December 2008.
On 30 March 2007 the Company acquired 100% of the shares of EXI International
Corp, a USA based vendor to television home shopping channels worldwide, trading
as Famous Discoveries. The Company paid the vendors consideration of US$2.5m,
which was satisfied by the issue of 3,144,594 new ordinary shares at an issue
price of 40.5p per share. Payment of further consideration to the vendors, of up
to US$ 2.6m, will be satisfied by the issue of further new ordinary shares at
the market price as at the dates of each such issue and will be by way of
earn-out dependent upon the financial performance of the Famous Discoveries
business for the two years ending 28 February 2009.
Loan Debt - on 4 May 2007 DKR Soundshore Oasis Holding Fund Limited ("Oasis")
converted US$100,000 of the US$3.0m 6% Convertible Unsecured Loan Notes Due
2007. The conversion price was 33.5p per ordinary share, and this resulted in
the issue of 149,283 new ordinary shares to Oasis. Other than this, there were
no repayments of loan debt during the period.
Dividends - no dividend payments were proposed or paid during the period.
Contingent assets and contingent liabilities - during the period the Group
excluded recognition of deferred tax as an asset on the basis that actual
occurrence is unlikely to arise in the foreseeable future. No other contingent
asset or liability arose during the period.
Earnings Per Share - the basic and diluted loss per ordinary share has been
calculated using the loss for the financial period and the weighted average
number of ordinary shares in issue during the period. The number of shares used
for the basic and diluted loss per share has been recalibrated for the impact of
the capital reorganization approved at the AGM on 31 July 2006.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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