RNS Number:2743R
Premier Management Holdings PLC
24 October 2003
For immediate release on Friday 24 October 2003
PREMIER MANAGEMENT HOLDINGS PLC
Statement of results for the year ended 30 April 2003
Key points
* Turnover up 27 per cent. to #2,136,000 (2002: #1,683,000) although
player representation fees are down
* Operating loss pre-exceptionals and amortisation of #510,000 (2002:
#327,000 profit)
* Provisions for exceptional items including bad debts, impairment of
investments in football player registrations and foreign exchange losses on the
convertible bond, together with amortisation of bond finance costs have resulted
in a pre-tax loss for the year of #4,107,000 (2002: #18,000 profit)
* The current year has started with a better than expected summer window
with European offices showing promise
* Group has restructured cost base to make it more flexible and
responsive to market conditions.
* The offices in Turkey, the Netherlands and Hungary are well positioned
for further growth.
* Negotiations are ongoing with the bondholder to ensure the long-term
future of the Group
Chairman, Barry Gold said,
"In common with our competitors we face testing market conditions, continually
trying to improve operating margins and collect debts from Clubs with cash flow
difficulties. The market's potential for recovery will be enhanced with the
ending of the three-year contracts with players entered into on the back of the
ITV digital deal. In the meantime we are working towards trades in the January
2004 transfer window and to do such deals as are permissible in the period up to
January. We are also planning to maximise the opportunities to the Group that
Euro 2004 will offer and work to this end has already started."
Further enquiries:
Barry Gold (Premier Management) - 07768 948 928 or 01227 366 992
Richard Evans (Brewin Dolphin Securities) - 0161 214 5553
Chairman's Statement
In common with other companies in our sector we have not found the last year an
easy one. Following the collapse of ITV Digital, the introduction of transfer
windows and the administration of a number of clubs, some owing fees to the
Company, has led to a pre-tax loss for the period of #4,107,000 (2002: #18,000
profit), despite a 27 per cent, increase in turnover to #2,136,000 (2002:
#1,683,000). Turnover was boosted by #892,000 (2002: #nil) of realisations of
player investments, but the fees from player representation activities were down
26 per cent. to #1,244,000 (2002: #1,683,000).
Of the loss, #1,126,000 is represented by the interest costs, amortisation of
finance costs and adverse foreign exchange movements on the Convertible Bond and
#1,780,000 is attributable to impairment of investments in football player
registrations and provisions for exceptional bad debts. In addition, the Group
has provided #531,000 against the carrying value of assets and goodwill in
subsidiary undertakings, impairment of image rights and the value of the
Company's shares held in its ESOP. After stripping out these items and
amortisation the underlying performance of the Group showed an operating loss of
#510,000 (2002: #327,000 profit).
Whilst the first six months of the year did show an improvement over the
corresponding period of the previous year, the Chairman warned in his interim
statement that unless trading in the January window of 2003 was strong then
trading in the second half of the year would be below our previous expectations.
During the window there were few major transfers and although we handled
several of them, including Jamie Clapham's move to Birmingham and Adil Ramzi's
move from PSV in Holland to Cordoba in Spain, trading in the second half of the
year was poor.
During the period outside the transfer windows whilst the market remained very
quiet, we completed our programme of overhead reductions. As a result the
Company now operates from offices outside Central London with a much reduced
head count as, regretfully, all our support staff and several of our agents have
left the Company. The overhead savings targeted have been achieved, although
the full benefit of these will only show during the year ending 30 April 2004,
and those agents who have remained have worked hard under difficult
circumstances.
Much uncertainty existed over the future of the football industry even before
the summer 2003 window opened. It was no surprise, therefore, that with the
notable exception of Chelsea activity levels were very quiet. The Company
turned over gross fess in excess of #750,000 during the summer window, which was
better than we expected, but once it closed the market returned to a state of
near hibernation, although there are signs of more potential business than the
corresponding period of last year.
Much of our turnover this summer was won from our offices in Hungary, Turkey and
Holland. These offices are lower cost in comparison with our UK operation and
exist in areas that are not "over-agented" like the UK. We would expect our
offices in Hungary and Turkey to benefit when or if those countries join the
European Union, giving opportunities for further expansion from both offices.
In the meantime, we face testing market conditions, continually trying to
improve operating margins and collect debts from Clubs with cash flow
difficulties. The market's potential for recovery will be enhanced with the
ending of the three-year contracts with players entered into on the back of the
ITV digital deal. In the meantime we are working towards trades in the January
2004 transfer window and to do such deals as are permissible in the period up to
January. We are also planning to maximise the opportunities to the Group that
Euro 2004 will offer and work to this end has already started.
We are currently in negotiations with our bondholder and provided a satisfactory
solution can be agreed we believe there is a long term future for the Group.
Accordingly, the Group's accounts have been prepared on the assumption the Group
is a going concern.
I would like to thank all the staff who have worked for the Company this year,
and to wish those who have left us during the year every success in the future.
It has been very difficult to say goodbye to old friends and colleagues, and to
restructure the arrangements of everyone who has stayed, and each and every one
of them deserve and have our thanks for their efforts in such a difficult
environment.
Barry Gold
24 October 2003
Consolidated profit and loss account
for the year ended 30 April 2003
2003 2002
#'000 #'000
Turnover 2,136 1,683
Cost of sales (1,100) -
-------- --------
Gross profit before exceptional impairment 1,036 1,683
Exceptional impairment of investment in footballers (1,135) -
-------- --------
Gross (loss)/profit (99) 1,683
Exceptional administrative expenses (1,867) (9)
Amortisation of intangible fixed assets (181) (33)
Other administrative expenses (1,546) (1,356)
-------- --------
Operating (loss)/profit (3,693) 285
Other interest receivable and similar income 27 73
Interest payable (243) (191)
Amortisation of finance costs (198) (149)
-------- --------
(Loss)/Profit on ordinary activities before taxation (4,107) 18
Taxation 209 (25)
-------- --------
(Loss)/Profit on ordinary activities after taxation (3,898) (7)
Dividends - -
-------- --------
Transfer from share premium account
relating to amortisation of finance costs 198 149
-------- --------
Retained (loss)/profit carried forward for the financial (3,700) 142
year ======== ========
(Loss)/Earnings per share
Basic (loss)/earnings per ordinary share (15.52)p (0.03)p
Adjusted for amortisation of finance costs (14.73)p 0.70p
The profit and loss has been prepared on the basis that all operations are
continuing operations.
There were no recognised gains or losses not dealt with through the profit and
loss account.
Consolidated balance sheet
as at 30 April 2003
Group Group Company Company
2003 2002 2003 2002
#'000 #'000 #'000 #'000
Fixed Assets
Intangible assets 3,299 3,729 - 132
Tangible assets 120 186 89 172
Investments 211 3,045 3,985 6,871
-------- -------- -------- --------
3,630 6,960 4,074 7,175
-------- -------- -------- --------
Current assets
Debtors 1,497 2,168 1,511 1,737
Current asset investments 1,342 1,342
Cash at bank and in hand 251 1,320 250 1,176
-------- -------- -------- --------
3,090 3,488 3,103 2,913
Creditors:
amounts falling due within one year (781) (1,515) (525) (1,242)
-------- -------- -------- --------
Net current assets 2,309 1,973 2,578 1,671
-------- -------- -------- --------
Total assets less current liabilities
Creditors: 5,939 8,933 6,652 8,846
amounts falling due over one year (6,407) (5,603) (6,407) (5,603)
-------- -------- -------- --------
Total assets less liabilities (468) 3,330 245 3,243
======== ======== ======== ========
Capital and reserves
Called up share capital 269 244 269 244
Share premium account 2,745 2,868 2,745 2,868
Profit and loss account (3,482) 218 (2,769) 131
-------- -------- -------- --------
Equity shareholders' funds (468) 3,330 245 3,243
======== ======== ======== ========
Consolidated cash flow statement
for the year ended 30 April 2003
2003 2002
#'000 #'000
Net cash movement from operating activities (153) (148)
-------- --------
Returns on investments and servicing of finance
Interest received 27 73
Interest paid (243) (191)
-------- --------
(216) (118)
-------- --------
Taxation paid (6) (7)
-------- --------
Capital expenditure
Payments to acquire intangible assets - (133)
Receipts on disposal of tangible assets 15 4
Payments to acquire tangible assets (13) (30)
Payments to acquire investments (175) (2,447)
26 -
-------- --------
(147) (2,606)
-------- --------
Acquisitions and disposals
Payments to acquire subsidiary undertakings (33) (982)
-------- --------
Net cash outflow before management of liquid resources (555) (3,861)
Management of liquid resources
Short term deposits 936 (186)
-------- --------
Net cash outflow before financing (381) (4,047)
-------- --------
Financing
Convertible loan stock - 4,343
Capital element of hire purchase contracts (41) (22)
Purchase of own shares by ESOP Trust - (210)
Payment for deferred consideration (421) -
-------- --------
(462) 4,111
-------- --------
(Decrease)/Increase in cash in the year (81) 64
======== ========
Notes:
1. The preliminary financial statement has been prepared on the basis of
the Group's normal accounting policies but does not constitute statutory
accounts. The comparative figures for the period ended 30 April 2002 have been
extracted from statutory accounts for the year then ended. These statutory
accounts have been delivered to the Registrar of Companies, the auditors report
on which was unqualified and did not contain a statement under section 237(2) or
(3) of the Companies Act 1985. It is anticipated that the Group's Annual Report
and Accounts for the year ended 30 April 2003 will be published and posted to
shareholders on 31 October 2003. Copies will be made available at the Company's
office at 11 Central House, Ongar, Essex CM5 9AA.
2. The Group's Accounts have been prepared on the assumption that the
group is a going concern. The accounts of the group for the year ended 30 April
2003 show a loss for the period of #3,898,000. Of this loss, #463,000 is
represented by the amortisation and impairment of goodwill, which does not
affect the operating cash flows of the group and #2,720,000 is attributable to
impairment of investments in footballers and other exceptional costs.
The group's ability to continue as a going concern is subject to the following:
* The group's ability to meet its future working capital requirements
is dependent on the group being able to generate further revenues and free cash
flow from its continuing activities over the levels already achieved;
* the collection of debtors and payment of creditors on a timely
basis or subject to agreed payment schedules; and
* The group's ability to repay its Convertible Eurobond which is due
in August 2004. At 30 April 2003 the liability, when translated into # Sterling
at the euro exchange rate ruling on that day, amounted to #5,592,000. The
directors are in negotiation with the bondholders over the terms of repayment.
The directors are confident that if a satisfactory solution can be agreed with
the bondholder the group will generate the necessary level of sales and will
resolve satisfactorily the matters referred to above. On this basis, in the
opinion of the directors, the accounts have been properly prepared on the
assumption that the group is a going concern. In making this assessment the
directors have had due regard to the net funds available to the group.
3. Gerald Edelman, Chartered Accountants and Registered Auditors
of 25 Harley Street, London W1G 9BR are the Company's auditors. In their audit
report to the audited accounts for the year ended 30 April 2003, which is
unqualified, they have stated:
"Going Concern
In forming our opinion, we have considered the adequacy of the disclosure made
in note 1.1 to the financial statements, which we consider should be brought to
your attention. Our opinion is not qualified in this respect."
The full text of note 1.1 to the audited accounts is set out in note 2 above.
ENDS
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR USSKROKRRURA