| Thu 30 Jan 2003, 11:25 | | African Media Entertainment - Preliminary Results |
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AFRICAN MEDIA ENTERTAINMENT
(Incorporated in the Republic of South Africa)
(Registration number 1926/008797/06)
("AME" or "the group")
PRELIMINARY RESULTS FOR THE YEAR ENDED 31 OCTOBER 2002
ABRIDGED GROUP INCOME STATEMENT
for the year ended 31 October
Reviewed Restated
2002 2001
R`000 R`000
Revenue 130 120 209 999
Continuing operations 87 142 200 230
Disposed operations 42 978 9 769
Operating (loss)/profit before
abnormal items (19 891) 4 808
Continuing operations (707) 11 762
Disposed operations (19 184) (6 954)
Abnormal items 27 118 601
Operating profit 7 227 5 409
Net interest paid (5 218) (7 273)
Profit/(loss) before taxation 2 009 (1 864)
Taxation (11 896) 3 469
Continuing operations (4 101) (4 078)
Deferred (7 795) 7 547
(Loss)/profit after taxation (9 887) 1 605
Outside shareholders` interest 424 (3 306)
Loss attributable to ordinary shareholders (9 463) (1 701)
Loss per share (cents) (1,17) (0,22)
Headline (loss)/earnings per share for
continuing operations (cents) (1,71) 0,89
Total headline loss per share (cents) (4,02) (0,01)
Weighted average number of shares
in issue (000`s) 809 354 779 524
Headline (loss)/earnings reconciliation
continuing operations
Loss attributable to shareholders (9 463) (1 701)
Abnormal items (27 118) (601)
Surplus on disposal of businesse (23 406) (3 487)
Restructuring and reorganisational costs - 2 886
Write-down of investments and share
incentive trust loan 2 832 -
Reversal of vendor liabilities (6 544) -
Disposed operations 18 721 6 954
Amortisation of goodwill 4 056 2 254
Headline (loss)/earnings for
continued operations (13 804) 6 906
ABRIDGED GROUP BALANCE SHEET
as at 31 October
Reviewed Restated
2002 2001
R`000 R`000
ASSETS
Non-current assets 44 450 71 829
Property, equipment and
production facilities 6 458 10 903
Trademarks and goodwill 35 734 40 564
Investments and loans - 7 920
Debtor for sale of business 1 600 -
Share Incentive Trust 317 1 879
Deferred taxation 341 10 563
Current assets 55 179 43 101
Inventories 81 10 853
Trade and other receivables 17 697 32 248
Debtors for sale of businesses and property 37 401 -
Total assets 99 629 114 930
EQUITY AND LIABILITIES
Capital and reserves
Issued capital and reserves 14 410 21 908
Minority interests 14 050 7 575
Non-current liabilities 8 026 16 642
Interest-bearing borrowings 8 026 13 642
Non-interest-bearing - vendor liabilities - 3 000
Current liabilities 63 143 68 805
Trade and other payables 29 794 30 173
Current portion of vendor liabilities 2 989 11 786
Current portion of interest-bearing b
borrowings 15 607 20 463
Taxation payable 6 499 6 043
Bank overdraft 8 254 340
Total equity and liabilities 99 629 114 930
ABRIDGED GROUP CASH FLOW STATEMENT
for the year ended 31 October
Reviewed Restated
2002 2001
R`000 R`000
Cash available from/(utilised by) operations 636 (15 138)
Investing and financing activities (3 331) 11 145
Net movement in cash and cash equivalents (2 695) (3 993)
Cash and cash equivalents at beginning of year (340) 4 961
Cash and cash equivalents from acquisitions
and disposals (5 219) (1 308)
Cash and cash equivalents at end of year (8 254) (340)
STATEMENT OF CHANGES IN EQUITY
for the year ended 31 October
Reviewed Restated
2002 2001
R`000 R`000
Issued capital 8 427 7 795
Balance at beginning of year 7 795 8 000
Issued/(returned) during the year 632 (205)
Share premium 32 101 30 768
Balance at beginning of year 30 768 31 921
Issued/(returned) during the year 1 333 (1 150)
Share issue expenses written off - (3)
Accumulated loss (26 118) (16 655)
Balance at beginning of year - as
previously stated (16 655) (14 406)
Prior year adjustment - adoption of AC135 - (548)
Restated balance (16 655) (14 954)
Loss for the year (9 463) (1 701)
As previously stated (9 463) 218
Change in accounting policy - adoption of AC135 - (147)
Prior year taxation underprovision - (1 772)
Total shareholders` interest 14 410 21 908
COMMENTS
FINANCIAL COMMENTARY
The group experienced difficult trading conditions at the start of the year
under review. The general lack of consumer and corporate spending in the first
few months of the financial year had a negative impact on most of the businesses
in the group. There were, however, significant improvements towards the end of
the year, driven by the group`s restructuring efforts and achievement of organic
growth in its core businesses.
The radio stations` Radio Algoa and OFM, produced solid results, despite the
slow start to the financial year. Turnover increased by 17% compared to the
previous year and costs were kept well under control. We are delighted to report
that both radio stations` broadcasting licences were renewed for a further
period of six years. The group is exploring opportunities in the growing of its
radio portfolio, within the changing radio environment.
The Dome at Northgate has continued its improved sales and is showing
encouraging signs of turnaround. The Dome was one of the venues chosen for the
World Summit for Sustainable Development in August 2002.
Foghound Studios, which is involved in the production of television commercials,
had a profitable year and the prospects for the next financial year remain
positive.
As part of the group`s restructuring process Golden Gloves, Big Concerts,
Moonlighting Filmmakers, Exclusive Hire and Penguin Films were disposed of
during the financial year. The results of these operations have been reflected
separately in the income statement.
The revenue for the year is R130,1 million (2001: R210,0 million), a 38%
reduction, mainly due to the disposal of non-core assets. The group has reported
an operating loss for continuing operations of R0,7 million (2001: R11,8
million) due to write-downs of irrecoverable amounts in the radio stations and
decreased earnings from Foghound Studios and The Dome.
Finance costs decreased to R5,2 million (2001: R7,3 million) due to a lower
average level of interest-bearing debt. Interest-bearing debt reduced from R34,1
million to R23,6 million. The proceeds of the Golden Gloves disposal will reduce
interest-bearing debt to acceptable levels. Certain lenders have agreed to
extend the tenor of their loans until after the receipt of the proceeds on the
disposal of Golden Gloves.
The group has incurred a headline loss for the year, excluding disposed
operations, of R13,8 million (2001: R6,9 million profit), and a loss per share
of 1,71 cents (2001: profit of 0,89 cents).
ACCOUNTING POLICIES
The results have been prepared in accordance with South African Statements of
Generally Accepted Accounting Practice. The accounting policies applied in this
report are consistent with those applied by the group in the previous financial
year, with the exception of the group`s property, which is now accounted for in
terms of AC135 - Investment Properties. The previous year`s results have been
adjusted downwards by R 1 919 000 being a R147 000 decrease arising from the
implementation of AC135 and a R1 772 000 adjustment arising from additional
income tax charges incurred by a subsidiary company.
PROSPECTS
The outlook for the next financial year is encouraging as all businesses are
expected to be profitable. Particular emphasis will be placed on improving both
operating profits and cash flows. This will be achieved by keeping costs under
control and growing existing revenue streams. Debt reduction remains a focus
point in an effort to substantially improve gearing and reduce related finance
costs.
Shareholders are reminded that the group is currently trading under a
cautionary, relating to the acquisition of United Stations.
GOING CONCERN
The group is experiencing cash flow constraints resulting from legacy debt.
Negotiations are underway to restructure the debt that gives rise to the cash
flow constraints.
AUDIT REVIEW
The year-end financial results have been reviewed in terms of rule 3.23 of the
listing requirements of the JSE Securities Exchange South Africa, by the group`s
auditors Charles Orbach & Company. In their review report, they have drawn
attention to the directors` statement relating to the going concern issue.
By order of the board
K Coyle Johannesburg
Chief executive officer 29 January 2003
Registered office
The Dome, Corner Olievenhout Avenue & Northumberland Road, North Riding
(PO Box 540, North Riding 2162)
Transfer secretaries
Computershare Investor Services Limited, 70 Marshall Street, Marshalltown 2107
(POBox 61051, Marshalltown 2107)
Directors
K Ngqula (Chairman)*, K Coyle (Chief executive officer), C de Klerk (Financial),
Z Lacob*, J Makobe*, T Sadik*
*Non-executive
Share code: AME
ISIN number: ZAE000014106
Website: www.ame.co.za
Date: 30/01/2003 08:33:09 AM Produced by the JSE SENS Department
