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African Media Entertainment - Interim Results For The Six Months Ended 30 April
Release Date: 08/07/2004 17:52:01 Code(s): AME
African Media Entertainment - Interim results for the six months ended 30 April
2004
African Media Entertainment
(Incorporated in the Republic of South Africa)
(Registration number 1926/008797/06)
Share code: AME ISIN: ZAE000055802
(AME or the Group or the Company)
Interim results for the six months ended 30 April 2004
Abridged group income statement
for the period ended 30 April 2004
Reviewed Audited
Six months ended Year ended
30 Apr 30 Apr 31 Oct
2004 2003 2003
R`000 R`000 R`000
Revenue 47 552 48 820 92 650
Continuing operations 46 252 39 576 78 163
Discontinued operations 1 300 9 244 14 487
Cost of sales and operating
expenses 40 533 48 218 91 816
Continuing operations 38 833 37 431 73 285
Discontinued operations 1 700 10 787 18 531
Operating profit/(loss) before
exceptional items 7 019 602 834
Continuing operations 7 419 2 145 4 878
Discontinued operations (400) (1 543) (4 044)
Exceptional items 1 945 (2 760) 5 779
Operating profit/(loss) 8 964 (2 158) 6 613
Net interest paid (706) (1 681) (2 669)
Profit/(loss) before
taxation 8 258 (3 839) 3 944
Taxation (5 004) (2 390) (4 060)
Current (3 195) (2 390) (4 369)
STC (2 000) - -
Deferred 191 309
Profit/(loss) after
taxation 3 254 (6 229) (116)
Minority interest (1 056) (685) (1 809)
Profit/(loss) attributable
to ordinary shareholders 2 198 (6 914) (1 925)
Earnings/(loss) per
share (cents)
Note 1 25,4 (82,0) (22,3)
Headline earnings/(loss)
per share for
continuing operations
(cents) 29,4 (6,6) 10,3
Total headline earnings/
(loss) per share (cents) 24,8 (24,9) (45,4)
Weighted average number of shares
in issue (000`s) 8 647 8 427 8 647
Headline earnings/(loss)
reconciliation for continuing
operations
Profit/(loss) attributable to
ordinary shareholders 2 198 (6 914) (1 925)
Exceptional items Note 2 (1 945) 2 760 (5 779)
Discontinued operations 400 1 543 4 812
Amortisation of intangible
assets 1 890 2 054 3 781
Headline earnings/(loss) for
continuing operations 2 543 (557) 889
Note 1
Adjusted for the consolidation of the authorised and issued share capital of the
company on the basis of 1-for-100 from shares having a par value of 1 cent each
to shares having a par value of 100 cents each, which consolidation became
effective on Friday, 25 June 2004. Comparative figures have been restated
accordingly.
Note 2
Exceptional items (1 945) 2 760 (5 779)
(Surplus)/deficit on disposal of
operations (1 945) 2 673 1 619
Impairment/(Reversal of impairment)
of investments and loans 87 (7 398)
Abridged group balance sheet
at30 April 2004
Reviewed Audited
30 Apr 30 Apr 31 Oct
2004 2003 2003
R`000 R`000 R`000
Assets
Non-current assets 35 682 42 842 37 679
Property, plant and equipment 2 810 5 934 3 071
Intangible assets 28 350 34 963 30 244
Investments and loans - 1 600 -
Deferred taxation 4 522 345 4 364
Current assets 17 816 24 743 20 389
Loans receivable 2 136 4 898 4 936
Trade and other receivables 13 114 19 845 15 453
Cash and cash equivalents 2 566
Total assets 53 498 67 585 58 068
Equity and liabilities
Capital and reserves 19 974 16 509 17 041
Issued capital and reserves 15 233 7 496 13 035
Minority interests 4 741 9 013 4 006
Non-current liabilities
Interest-bearing borrowings - 5 239 7 516
Current liabilities 33 524 45 837 33 511
Trade and other payables 11 782 28 824 20 042
Taxation payable 6 982 6 938 7 944
Bank overdraft 7 295 3 486 2 761
Current portion of
interest-bearing borrowings 7 465 6 589 2 764
Total equity and liabilities 53 498 67 585 58 068
Abridged group cash flow statement
for the period ended 30 April 2004
Reviewed Audited
Six months ended Year
ended
30 Apr 30 Apr 31 Oct
2004 2003 2003
R`000 R`000 R`000
Cash generated from operations 9 541 3 733 7 935
Net interest paid (706) (1 681) (2 669)
Taxation paid (5 443) (1 954) (2 319)
Outside shareholders paid - (6 375) -
Increase in working capital (3 602) (3 846) (376)
Cash (utilised in)/available
from operations (210) (10 123) 2 571
Cash flows from investing
activities (1 423) 424 19 970
Cash flows from financing
activities 7 181 15 173 (16 342)
Net movement in cash and
cash equivalents 5 548 5 474 6 199
Cash and cash equivalents at
beginning of period (2 761) (8 254) (8 254)
Non-current liability transferred
to bank overdraft (7 516) - -
Cash and cash equivalents from
acquisitions and disposals - (706) (706)
Cash and cash equivalents at
end of period (4 729) (3 486) (2 761)
Statement of changes in equity
for the period ended 30 April 2004
Reviewed Audited
Six months ended Year
ended
30 Apr 30 Apr 31 Oct
2004 2003 2003
R`000 R`000 R`000
Issued capital
Balance at beginning of
period 8 647 8 427 8 427
Issued during the period - - 220
Balance at the end of the
period 8 647 8 427 8 647
Share premium
Balance at beginning of
period 32 431 32 101 32 101
Issued during the period - - 330
Balance at the end of the
period 32 431 32 101 32 431
Accumulated loss
Balance at beginning of
period (28 043) (26 118) (26 118)
Accumulated loss for the
period 2 198 (6 914) (1 925)
Balance at the end of the
Period (25 845) (33 032) (28 043)
Total capital and
Reserves 15 233 7 496 13 035
Comments
Financial commentary
Operations
As indicated in the commentary in the 2003 annual report, the Group`s focus on
its core business of radio stations has produced a satisfactory return to a net
profit before tax of R8 258 000 (2003: Loss R3 389 000). The Group closed the
last of its non-core businesses in early 2004 and The Dome@Northgate was placed
in liquidation in January this year. As anticipated, a surplus of R1 945 000 was
made as a result of this closure.
The Group is now comprised of two radio stations - OFM covering central South
Africa and Algoa FM covering the Eastern Cape - and United Stations, the agency
that procures all the advertising for the radio stations. The Group`s radio
stations have always been profitable. The increase in advertising revenue
provided by United Stations during the period under review has been substantial,
with our radio stations` revenue increasing by 27% compared to the same period
last year.
United Stations now only sells advertising for the Group`s radio stations.
Despite their increased turnover, this company incurred further losses during
the period. Steps have been taken to reduce overheads and the company could
contribute to Group profits by the end of the current financial year.
After the end of this reporting period OFM was pleased to hear that its
application to ICASA for two transmitters in the southern Free State to be re-
activated and for an additional transmitter to be established at Sasolburg,
still within the station`s designated footprint, was successful. This means that
the station will now broadcast to an additional 650 000 potential listeners who
were always in its footprint, but never able to receive the station`s signal.
Liquidity
Whilst the Group`s trading operations have now turned profitable, they will not
generate sufficient cash to settle the borrowings that are due for repayment
within the next nine months. The Board has been in negotiations to secure
support for the raising of capital to relieve the Group of the remaining legacy
debt that has had such a negative impact on its balance sheet for the past three
years.
Accounting policies
The results have been prepared in accordance with South African Statements of
Generally Accepted Accounting Practice. The policies applied in this report are
consistent with those applied by the Group in the previous financial year. The
interim report has been prepared in accordance with AC127, Interim Financial
Reporting.
Review report
The financial results for the six months ended 30 April 2004 have been reviewed,
in terms of rule 3.18(b) of the Listings Requirements of the JSE Securities
Exchange South Africa, by the Group`s auditors, Charles Orbach & Company. In
their review they have drawn attention to the directors` statement relating to
the liquidity of the Group. A copy of the auditors` review report is available
for inspection at the registered office of the Company.
By order of the board
ACG Molusi
Chairman Johannesburg 8 July 2004
Registered office: 5th Floor, Park Terras, 33 Princess of Wales Terrace,
Parktown, Johannesburg
PO Box 3014, Houghton 2041
Transfer secretaries: Computershare Investor Services 2004 (Pty) Limited, 70
Marshall Street, Marshalltown PO Box 61051, Marshalltown 2107
Directors: ACG Molusi (Chairman)*, S Katz (Chief operating officer), Z Lacob*,
MJ Prinsloo*, W Tshuma* *Non-executive
Website: www.ame.co.za
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