Preliminary Results
14 3월 2003 - 4:00PM
UK Regulatory
RNS Number:7240I
Talent Group PLC
14 March 2003
EMBARGOED - NOT TO BE RELEASED UNTIL 7.00 A.M. 14 March, 2003
Talent Group PLC ("Talent Group" or "the Company")
Preliminary Results
Chairman's Statement
Overview
I am presenting the first results of the Group since my appointment as Chairman
on 23rd December 2002, the date that the acquisition of The Talent Group Limited
("Talent") was completed.
In order to bring into line the year-end of the Company with that of Talent and
its subsidiaries, your Board has decided to change the year-end of the Company
to 30 September. Accordingly, the period now under review represents the seven
months to 30 September 2002, which is a period prior to the acquisition of
Talent.
The financial period started with a restructuring of the business in March 2002
designed to reduce the cost base to a much lower level and this was successfully
achieved within the planned timescale. However, the market for the Company's
products continued to be difficult, and although several major projects with
potential clients were under advanced discussion, in the view of the then Board
the likelihood of these achieving significant sales revenue within an acceptable
period was low. As a result in August 2002 the decision was taken by the then
directors of the Company to sell the remaining business and exit from the
software sector entirely.
The transfer of the remaining business to two companies was announced on 10
October 2002 for a nominal consideration and a commission on future sales. The
remaining employees left the Company by the end of October 2002 and all the
remaining assets were sold.
As the decision to close the business was made prior to 30 September 2002 the
balance sheet includes accruals for remaining costs and revenues resulting from
its implementation.
Results
The turnover for the seven months to 30 September 2002 was #148,000 (year ended
28th February 2002: #617,000) on which a pre-tax loss of #938,000 was incurred
(year ended 28th February 2002: loss of #6.345 million). This loss includes
restructuring costs of #219,000 (year ended 28 February 2002: #1.2 million).
Included in the accounts for the seven months to 30 September 2002 are research
and development tax credits amounting to #322,000. The tax credits have arisen
as a result of claims made in February 2003 in respect of the two years ended
28th February 2002 and a claim to be submitted for the period ended 30th
September 2002.
The cash position at 30th September 2002 was #706,000 compared to a balance of
#1.538 million at 28th February 2002. For the seven month period, there was a
loss per share of 1.01p (year ended 28 February 2002: loss per share of 11.12p).
Board changes
Chris Thomas and Gwyn Jones resigned from the Board on 6 March 2002 and Derek
Cormack resigned from the Board on 7 October 2002. On 23 December 2002 Edward
Carroll resigned from the Board and John Kaye Cooper, Anthony Humphreys, Colin
Nicholl and I were appointed to the Board as Deputy Chairman and Creative
Director, Managing Director, Finance Director and Chairman respectively.
Current trading and outlook
Since Talent's reverse takeover of RMR Plc, it has continued to develop its
television production business. Following the success of Test The Nation, the
National 2002 Test, broadcast on BBC 1 at primetime on 23 December 2002, Talent
has continued to work with the BBC on the Test The Nation project, with further
shows scheduled for 2003.
Annie Miles joined us to establish a new division, Talent Kids, at the beginning
of 2003 and the combination of her expertise in children's television with
Talent's international entertainment expertise is already leading to some
interesting potential developments with a number of other broadcasters. A
fourth series of "The Villa" for Sky One has completed production and is due for
transmission later in 2003.
Your directors were delighted when the quality of Talent's productions was
recognised by its nomination for two Broadcast awards during 2002.
The next published results of the Group will be the unaudited interim results
for the six months to 31 March 2003. These will incorporate the results of
Talent for the period since acquisition on 23 December 2002.
Enterprise Investment Scheme ("EIS")
The Board is aware that certain shareholders of the Company acquired ordinary
shares in the Company at the placing and admission of the Company's shares in
April 2000 with the benefit of EIS income tax relief. Under EIS legislation,
the investment must remain qualifying and be held for three years to qualify for
this relief. Following the restructuring and transfer of the business as
mentioned above and the acquisition of Talent, the Company has made
representations to the Inland Revenue to confirm the continued qualification of
the Company as a qualifying trading company. Shareholders will be advised of
the outcome of these representations in due course.
Robert Benton
Chairman
13 March, 2003
Consolidated Profit and Loss Account
for the period ended 30 September 2002
Note 7 months to 30 12 months to 28
September February
2002 2002
#'000 #'000
Turnover 148 617
Cost of sales (282) (2,394)
Gross Result (134) (1,777)
Operating costs (508) (2,932)
Goodwill write-off (100) (600)
Restructuring costs 1 (219) (1,200)
Administrative expenses (827) (4,732)
Operating loss (961) (6,509)
Net interest 23 164
Loss before taxation (938) (6,345)
Taxation 2 322 -
Loss for the year (616) (6,345)
Basic and diluted loss per ordinary share 3 (1.01p) (11.12p)
The results relate to continuing activities of the Group during the period.
There were no recognised gains or losses other than the loss for the financial
year.
Consolidated Balance Sheet
as at 30 September 2002
30 September 2002 28 February 2002
#'000 #'000 #'000 #'000
Fixed assets
Tangible assets - 86
Investments - -
- 86
Current assets
Debtors 389 188
Cash at bank and in hand 706 1,538
1,095 1,726
Creditors: amounts falling due within one year (348) (470)
Net Current assets 747 1,256
Total assets less current liabilities 747 1,342
Creditors: amounts falling due after more than one year (21) -
Net assets 726 1,342
Capital and reserves
Called up share capital 6,110 6,110
Share premium account 10,650 10,650
Profit and loss account (16,034) (15,418)
Shareholders' funds 726 1,342
Consolidated Cash Flow Statement
for the period ended 30 September 2002
Note 7 months to 30 12 months to
September 28 February
2002 2002
#'000 #'000
Net cash outflow and servicing of finance (a) (906) (4,645)
Returns on investments and servicing of finance
Interest element of finance lease rentals (1) (6)
Interest received 24 170
23 164
Capital expenditure and financial investment
Purchase of tangible fixed assets - (92)
Sale of tangible fixed assets 51 37
Purchase of investments - (150)
51 (205)
Cash outflow before management of liquid resources (832) (4,686)
Financing
Issue of share capital - -
Expenses paid in connection with the issue of share capital - -
Capital element of finance lease and hire purchase contracts - (46)
Net Cash outflow from financing - (46)
Decrease in cash (c) (832) (4,732)
(a) Reconciliation of operating loss to net cash outflow from operating
activities
30 September 28 February
2002 2002
#'000 #'000
Operating loss (961) (6,509)
Depreciation and impairment on tangible fixed assets 65 1,055
Goodwill write-off 100 600
Impairment losses on fixed asset investment - 150
(Profit)/loss on sale of tangible fixed assets (35) 149
Decrease in debtors 127 415
Decrease in creditors (202) (505)
Net cash outflow from operating activities (906) (4,645)
(b) Analysis of changes in net funds
At 1 March Cash flow At 30 September
2002 #'000 2002
#'000 #'000
Cash in hand 1,538 (832) 706
Finance leases (23) 23 -
Total 1,515 (809) 706
(c) Reconciliation of net cash flow to movement in net debt
30 September 28 February
2002 2002
#'000 #'000
(Decrease)/increase in cash in the period (832) (4,732)
Capital element of finance leases and hire purchase contracts 23 46
Change in net funds resulting from cash flows (809) (4,686)
Inception of finance leases - -
Movement in net funds in the period (809) (4,686)
Net funds at 1 March 2002 1,515 6,201
Net funds at 30 September 2002 706 1,515
Notes to the financial statements
1. Restructuring costs
#219,000 (28 February 2002: #1,200,000) was incurred during the period as the
business significantly reduced in size and scale. These costs comprise #65,000
(28 February 2002: #708,000) of impairment losses on fixed assets and #154,000
(28 February 2002: #492,000) in relation to staff redundancies.
2. Taxation
Factors affecting the tax charge for the period:
The tax assessed to the period does not equate to the standard rate of
corporation tax in the UK of 30% (28 February 2002: 30%). The differences are
explained as follows:
7 months to 30 12 months to
September 28 February
2002 2002
#'000 #'000
Loss on ordinary activities before taxation (938) (6,345)
Loss on ordinary activities multiplied by the standard rate of (281) (1,904)
corporation tax in the UK of 30%
Expenses not deductible for tax purposes - 413
Depreciation in excess of capital allowances for the year - 239
Other timing differences - 7
Tax receivable re Research & Development Tax Credit - current period 20 -
- previous 302 -
Tax losses not utilised 281 1,245
Current tax charge for the period 322 -
The tax receivable has arisen as a result of claims for Research & Development
Tax Credits in respect of the two years ended 28 February 2002 and the period
ended 30 September 2002.
3. Loss/Earnings per share
The loss per share is based on a loss of #616,000 (28 February 2002:
#6,345,000), being the loss attributable to ordinary shareholders, and a
weighted average of 61,102,847 (28 February 2002: 57,042,573) ordinary shares.
The figures presented here represent the position as at 30 September 2002,
before the acquisition of Talent and the capital reorganisation that occurred on
23 December 2002.
4. Dividends
No dividends have been proposed or paid in respect of the seven months ended 30
September, 2002 or the year ended 28 February 2002.
5. Publication of non-statutory accounts
The financial information set out in this preliminary announcement does not
constitute statutory accounts as defined in Section 240 of the Companies Act
1985.
6. The financial information for the year ended 28 February 2002 is extracted
from the Group's financial statements to the date which received an unqualified
auditor's report and have been filed with the Registrar of Companies.
The financial information for the period ended 30 September 2002 is
extracted from the Group's financial statements to date which received an
unqualified auditor's report and will be filed with the Registrar of Companies.
7. Copies of the Report and Accounts will be sent to shareholders in due
course and will be available from the head office of the Company, MWB Business
Exchange, 77 Oxford Street, London W1D 2ES.
Further Enquiries:
Talent Group plc Tel: 020 7659 2017
Tony Humphreys - Managing Director
Colin Nicholls - Finance Director
John East & Partners Limited Tel: 020 7628 2200
John East
David Worlidge
This information is provided by RNS
The company news service from the London Stock Exchange
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