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AME
AME
AME - African Media Entertainment Limited - Unaudited interim results for the
six months ended 30 September 2010
African Media Entertainment Limited
(Incorporated in the Republic of South Africa)
(Registration number 1926/008797/06)
Share code: AME ISIN: ZAE000055802
Website: www.ame.co.za
("AME" or "the group")
UNAUDITED INTERIM RESULTS for the six months ended 30 September 2010
CONSOLIDATED ABRIDGED STATEMENTS OF COMPREHENSIVE INCOME
Unaudited Unaudited Audited
six months to six months to year ended
September September 31 March
% 2010 2009 2010
change R`000 R`000 R`000
Revenue 16 87 416 75 229 158 373
Cost of sales (25 305) (21 267) (46 641)
Gross profit 62 111 53 962 111 732
Operating expenses (44 367) (38 359) (75 628)
Operating profit 14 17 744 15 603 36 104
Investment income 275 - -
Finance income 2 074 2 663 5 098
Finance cost (76) (160) (203)
Losses attributable
to associates (330) (486) (2 207)
Net profit before
taxation 12 19 687 17 620 38 792
Taxation (6 153) (5 737) (14 683)
SA normal taxation (6 185) (5 173) (11 477)
Deferred taxation 32 44 (1 222)
Secondary taxation
on companies - (608) (1 984)
Total comprehensive
income for the period 14 13 534 11 883 24 109
Total comprehensive
income
attributable to:
Non-controlling
interest holders 1 669 1 715 2 668
Equity holders of
the parent 17 11 865 10 168 21 441
Earnings per share
(cents) 17 139,0 119,1 251,1
Headline earnings
per share (cents) 19 141,3 119,1 266,8
Diluted earnings per
share (cents) 16 136,5 118,1 249,4
Diluted headline
earnings
per share (cents) 18 138,8 118,1 265,0
Dividends per share
(cents) - - 200
Number of shares in
issue (000`s) 8 539 8 539 8 539
Diluted average
number of
shares in issue
(000`s) 8 692 8 610 8 597
Headline earnings
reconciliation
Profit attributable
to equity holders 11 865 10 168 21 441
Loss on disposal of
fixed assets - - 42
Impairment of loans
to associate 199 - 1 295
Headline earnings 12 064 10 168 22 778
CONSOLIDATED ABRIDGED STATEMENTS OF FINANCIAL POSITION
Unaudited Unaudited Audited
September September 31 March
2010 2009 2010
R`000 R`000 R`000
Assets
Non-current assets 76 585 53 146 61 362
Property, plant and equipment 25 130 14 778 20 258
Investments 10 954 1 633 635
Goodwill 35 431 30 431 35 431
Deferred taxation 5 070 6 304 5 038
Current assets 74 368 74 248 79 383
Trade receivables 36 981 30 094 31 520
Other receivables 1 967 1 887 1 715
Cash and cash equivalents 35 420 42 267 46 148
Total assets 150 953 127 394 140 745
Equity and liabilities
Total equity 101 818 94 245 87 960
Non-current liabilities 890 875 939
Operating lease accrual 647 712 647
Interest-bearing borrowings 243 163 292
Current liabilities 48 245 32 274 51 846
Trade payables 25 891 14 742 16 719
Other payables 20 234 16 875 14 954
Dividend payable 934 - 17 257
Operating lease accrual and
interest-bearing borrowings 295 509 451
Taxation 891 148 2 465
Total equity and liabilities 150 953 127 394 140 745
CONSOLIDATED ABRIDGED STATEMENTS OF CHANGES IN EQUITY
Unaudited Unaudited Audited
six months to six months to year ended
September September 31 March
2010 2009 2010
R`000 R`000 R`000
Issued capital
Balance at beginning and end of
period 8 539 8 539 8 539
Share premium
Balance at beginning and end of
period 31 909 31 909 31 909
Retained profit
Balance at beginning of period 43 988 39 803 39 803
Total comprehensive income for
the period 11 865 10 168 21 441
Dividend - - (17 256)
Balance at end of period 55 853 49 971 43 988
Non-distributable reserve
Balance at beginning of period 1 869 1 608 1 608
Share based payment expense 324 346 261
Balance at end of period 2 193 1 954 1 869
Non-controlling interests
Balance at beginning of period 1 655 4 687 4 687
Share of dividend - (4 530) (5 700)
Share of total comprehensive
income for the period 1 669 1 715 2 668
Balance at end of period 3 324 1 872 1 655
Total capital and reserves 101 818 94 245 87 960
CONSOLIDATED ABRIDGED STATEMENTS OF CASH FLOWS
Unaudited Unaudited Audited
six months to six months to year ended
September September 31 March
2010 2009 2010
R`000 R`000 R`000
Cash generated by operating
activities 19 239 17 656 37 947
Net interest received 1 998 1 749 4 895
Taxation paid (7 759) (9 270) (14 634)
Decrease in working capital 8 740 345 117
Cash flows from operating
activities 22 218 10 480 28 325
Dividends paid (16 323) (17 257) (17 257)
Cash flows from investing
activities (16 623) (1 012) (12 838)
Cash flows from financing
activities - (3 562) (5 700)
Net decrease in cash and
cash equivalents (10 728) (11 351) (7 470)
Cash and cash equivalents at
beginning of period 46 148 53 618 53 618
Cash and cash equivalents at
end of period 35 420 42 267 46 148
COMMENTARY
Basis of preparation
These reports have been prepared in accordance with the group`s accounting
policies that comply with International Financial Reporting Standards, IAS34,
the Companies Act No. 61 of 1973 and the Listings Requirements of the JSE, on a
basis consistent with the policies and methods of computation as used in the
Annual Financial Statements for the year ended 31 March 2010.
Financial results
Revenue for the period was R87,4 million with a comprehensive income of R13,5
million.
The comprehensive income attributable to equity holders of the parent amounted
to R11,9 million (2009: R10,2 million) with earnings per share of 139,0 cents
(2009: 119,1 cents). Headline earnings per share were 141,3 cents (2009: 119,1
cents).
After paying tax of R7,8 million, the group generated R22,2 million in cash from
its operating activities during the period. The Group invested R9,2 million in
Mokgosi Holdings, R0,7 million in Moneyweb and R5 million on equipment.
After paying dividends of R16,3 million, the group ended the period with cash
resources of R35,4 million.
Segmental report
No segmental report for the current and comparative periods are included, as the
board considers the individual operations to form one integrated business unit
operating within South Africa and is viewed as such by the chief operating
decision makers.
AlgoaFM
AlgoaFM`s net advertising revenue showed an increase of 18% compared to the
previous period. Both the FIFA 2010 Wold Cup soccer and the Airtel Champions
League cricket had a significant impact on national revenues.
Operating costs were well controlled at less than the inflation rate resulting
in a better than budgeted income after taxation.
Listenership remained stable during the period under review.
The company acquired a 50% stake in a free handout newspaper called
SportsElizabeth, with a distribution of approximately 35 000 in the Nelson
Mandela metropolitan area. Going forward, AlgoaFM will be taking responsibility
for the sales initiative.
OFM
The radio station was able to track positively against budget, mainly due to
good cost control and a recovery in the national sales market. The station
benefitted from last minute advertising spend planned for the World Cup. There
was also a good uptake for some of the newer non-traditional products such as
activation and online advertising.
Audience levels remained stable during the period, although changes were made to
the lineup. A new breakfast show was launched in February and indications are
that it has had a positive impact on both audience as well as advertising.
There has also been strong uptake for web development offered by the digital
team. Apart from advertising demand growing in this sector, the team is
positioned to develop on both major platforms and the order book is full for
development. This is seen as a strong growth market and some large local web
platforms are under construction.
United Stations
Specialist media sales partner United Stations took another step forward in
realising its vision to be the obvious choice for assisting radio stations to
maximise their advertising revenue at the lowest cost of sale. The company
successfully competed for the national sales contract of premier Gauteng station
Kaya FM and have brought the station`s sales in house from 1 September 2010. At
the same time they have managed to buck the industry wide trend of flat or
negative revenues, by posting good year on year growth for all client platforms.
RadioHeads
RadioHeads is a team of radio specialists offering radio skills specifically in
the provision of Branded Content, Station Imaging, Creative, Campaign management
and Direct Response Radio solutions.
During the past six months the company has managed to syndicate its home-grown
show Point of View across four metropolitan stations. This achievement is
significant in that it speaks to RadioHeads` vision of ownership of proprietary
content that can be leveraged for sponsorship and promotion.
The company has incurred a loss in the current period mainly as a result of the
investment cost in the Point of View platform.
Prospects
The Board is cautiously optimistic that the growth in earnings will be
maintained for the remainder of the year.
By order of the Board
ACG Molusi M Mynhardt
Chairman Director
19 November 2010
Johannesburg
Registered office
Unit Block A, Oxford Office Park
No. 5 8th Street, Houghton Estate, Johannesburg
PO Box 3014, Houghton, 2041
Transfer secretaries
Computershare Investor Services (Proprietary) Limited
70 Marshall Street, Marshalltown
PO Box 61051, Marshalltown, 2107
Sponsor
Arcay Moela Sponsors (Proprietary) Limited
3 Anerley Road, Parktown, Johannesburg
PO Box 62397, Marshalltown, 2107
Directors
ACG Molusi (Chairman)*, AJ Davies, M Mynhardt
MJ Prinsloo*, N Sooka**, W Tshuma*
*Independent Non-executive
**Non-executive
WWW.AME.CO.ZA
Date: 19/11/2010 17:29:01 Produced by the JSE SENS Department.
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