TIDMCMX
RNS Number : 6785U
Catalyst Media Group PLC
30 March 2023
30 March 2023
Catalyst Media Group Plc
("CMG", "Catalyst" or the "Company")
Interim Results for the Six Months Ended 31 December 2022
The Board of CMG (AIM: CMX) is pleased to announce the Company's
unaudited interim results for the six months ended 31 December
2022.
CMG is a 20.54% shareholder in Sports Information Services
(Holdings) Limited ("SIS") and the results include its share in the
profits/(losses) of SIS as an equity accounted associate.
Financial Highlights for the six months to 31 December 2022
-- CMG profit after taxation of GBP0.30 million (2021: GBP0.45 million)
-- Earnings per share of 1.45p (2021: 2.14p)
-- Net asset value per share of 170.4p (2021: 54.5p)
-- For the six months to 30 September 2022, SIS achieved
- Revenues of GBP125.8 million (2021: GBP113.4 million)
- Operating profit of GBP1.9 million (2021: GBP3.0 million)
- Profit after tax on ordinary activities of GBP1.8 million (2021: profit of GBP2.4 million)
-- On 18 November 2022, SIS declared a dividend of GBP4.4
million of which GBP0.9 million was received by CMG.
-- CMG has not declared nor paid any dividends during the
reporting period or during the prior period, but a dividend of
GBP0.7m (3.3p per ordinary share) was declared and paid by CMG,
post the reporting period end, in January and February 2023
respectively.
Current Trading and Outlook
SIS's trading remains robust and its management continues to
pursue and win new business opportunities both in terms of content
acquisition, most recently securing new rights for Australian
Horseracing from Victorian Thoroughbred Racing and Racing South
Australia, and new customers, with the most recent deals announced
being with BetGo+ and Kiron Interactive.
SIS has also recently launched the first of its esports
offerings in New Jersey and Colorado which marks another
significant step in the further geographic diversification of this
particular business line.
SIS has advised CMG that it expects to close its financial year
to 31 March 2023 with increased revenue and profit before tax
year-on-year.
Enquiries:
Catalyst Media Group Plc
Michael Rosenberg, Non-executive Chairman Mob: 07785 727 595
Melvin Lawson, Non-executive Director Tel: 020 7734 8111
Strand Hanson Limited Tel: 020 7409 3494
James Harris / Matthew Chandler
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014 as it forms part of
United Kingdom domestic law by virtue of the European Union
(Withdrawal) Act 2018, as amended by virtue of the Market Abuse
(Amendment) (EU Exit) Regulations 2019.
Chairman's Statement
For the six-month period ended 31 December 2022, the Company
achieved a net profit after taxation of GBP0.30 million (2021:
GBP0.45 million).
Net assets as at 31 December 2022 were GBP35.8 million (30 June
2022: GBP35.5 million). Net cash as at 31 December 2022 was
approximately GBP0.9 million (30 June 2022: GBP0.1 million).
CMG's main asset remains its 20.54% stake in SIS and, in
November 2022, the Company received a dividend of GBP0.9 million
from SIS. The value of CMG's investment in SIS has reduced from
approximately GBP35.4 million to approximately GBP34.9 million,
reflecting the impact of the dividend receipt offset by CMG's share
of the profits achieved by SIS in the six months to 30 September
2022. As a result, CMG's net assets per share as at 31 December
2022 were 170.4p (2021: 54.5p). The carrying value of our
investment in SIS will be reviewed again at our financial year
end.
CMG equity accounts for its share in the profit of SIS which was
GBP1.8 million after tax for its six-month period to 30 September
2022 (2021: GBP2.4 million). SIS's revenues for such period were
GBP125.8 million (2021: GBP113.4 million) which were derived from
its business of providing integrated television and data services
to Licensed Betting Offices in the UK, Ireland and overseas. SIS
generated an operating profit for this period of GBP1.9 million,
compared to an operating profit of GBP3.0 million in the comparable
period for 2021.
Following the declaration and payment of a GBP0.7m dividend
(3.3p per ordinary share) in January and February 2023
respectively, CMG currently has cash reserves of approximately
GBP0.2 million which is sufficient for its present
requirements.
Set out below is an overview of the activities of SIS's key
divisions for the period under review.
SIS - UK and Ireland Retail
SIS continues to provide a core service including Racecourse
Media Group horseracing, the SIS British Greyhound Service, Irish
Horseracing, Chelmsford City Horseracing, 49s and International
Horseracing to almost the entire UK and Irish retail market,
including all of the major UK bookmaking groups and the majority of
the independent market.
In advance of the scheduled renewal dates SIS has recently
renewed, on a long-term basis, a combination of production,
distribution, and content deals with 80% of the major bookmaker
Licensed Betting Operator ("LBO") market and is in advanced stage
negotiations with the remainder of the major bookmaker LBO market.
This is in addition to the majority of the Independent Retail
Bookmakers who are already signed up to SIS's services through to
2024.
SIS has recently secured additional content for its UK Retail
and Digital customers in the form of South African horseracing from
4Racing, Italian horseracing and Australian horseracing content
from both Victorian Thoroughbred Racing and Racing South
Australia.
SIS - International & Online
SIS has seen continued growth in both existing customer revenues
and its customer base for its online racing content through both
its 24/7 racing channels and direct content distribution. SIS has
over 140 live feeds to customers designed to maximise betting
opportunities for international retail and online operators and has
signed up numerous international and online operators to multi-year
agreements. SIS continues to progress its strategy to increase
distribution, in both new and existing international and online
markets, using proprietary production technology as well as
ultra-low latency streaming and data pricing services.
In November 2022, SIS exercised its option to acquire a further
25% interest in Racelab Pty Limited ("Racelab"), a racing data
science company in Australia, thereby increasing its total stake to
50%. Racelab provides a range of market leading products across the
SIS portfolio of international horse and greyhound racing.
SIS - Non-racing content
Numbers products online, operated under the 49's brand, have
grown significantly in the period, driven by a combination of
increased customers and an expanded product range, and complemented
by an upgrade of the 49s.co.uk website which has driven affiliates
revenue. In December 2022 bet365 launched a new online draw
product, Lotto365, powered by SIS's 49s business which brought the
total number of events delivered under the 49's brand to over
300,000.
The SIS Competitive Gaming (e-sports) service, which was
launched during lockdown in May 2020, has continued to scale the
number of events created and increase revenues with new customers
onboarding during the period. The business has three titles focused
around eBasketball, eFootball and Counter Strike: Global Offensive
(CS: GO), a traditional e-sports product, and creates over 100,000
events per annum with the ability to scale further. SIS has also
recently launched the first of its esports offerings in New Jersey
and Colorado which marks another significant step in the further
geographic diversification of this particular business line.
India
An arbitration award was made in July 2020 which the respondent
has paid into court. These funds are now subject to appeals in the
Delhi High Court by both parties: SIS continues to pursue claims
disallowed by the arbitrators whilst the respondent attempts to
nullify the award in its entirety. The overall outcome therefore
remains uncertain.
The legal and associated costs relating to this claim have been
significantly reduced but are still impacting SIS's profits.
SIS Current Trading and Outlook
SIS's trading remains robust, and its management continues to
pursue and win new business opportunities both in terms of content
acquisition, most recently securing new rights for Australian
Horseracing from Victorian Thoroughbred Racing and Racing South
Australia and new customers, with the most recent deals announced
being with BetGo+ and Kiron Interactive.
SIS has advised CMG that it expects to close its financial year
to 31 March 2023 with increased revenue and profit before tax
year-on-year
SIS's cash position as of 28 February 2023 was approximately
GBP51m.
As announced previously by the Company, in November 2022 SIS
engaged Oakvale Capital LLP ("Oakvale Capital") to review strategic
options for the SIS business and this review is ongoing. The
outcome of this review process may include various courses of
action for the future of the business and once the SIS board has
reached any conclusions an appropriate announcement will be made by
CMG.
CMG Outlook
The Board of CMG notes the positive report from SIS that its
revenues and profits are expected to show increased growth for its
financial year ending 31 March 2023 compared to the previous year.
We look forward to the outcome of the review currently being
undertaken by Oakvale Capital. Meanwhile overheads for CMG continue
to remain at a very low level as in previous years.
Michael Rosenberg OBE
Chairman
29 March 2023
Consolidated interim statement of comprehensive income
Notes 6 months 6 months 12 months
to 31 December to 31 December to 30 June
2022 2021 2022
GBP GBP GBP
Unaudited Unaudited Audited
Revenue 12,500 12,500 25,000
Cost of sales - - -
---------------- ---------------- ------------
Gross profit 12,500 12,500 25,000
Administrative expenses (77,355) (60,049) (137,859)
Operating loss (64,855) (47,549) (112,859)
Financial income 874 9 36
Net financial income 874 9 36
---------------- ---------------- ------------
Share of profit of equity-accounted
associate 3 368,077 497,890 1,153,937
Reversal of impairment of equity-accounted
associate - - 23,391,701
---------------- ---------------- ------------
Profit before taxation 304,096 450,350 24,432,815
Taxation - - 23,957
Profit for the period 304,096 450,350 24,456,772
---------------- ---------------- ------------
Share of other comprehensive
profit of associate - - 67,782
Total comprehensive income for
the period 304,096 450,350 24,524,554
---------------- ---------------- ------------
Attributable to equity holders
of the Company 304,096 450,350 24,524,554
---------------- ---------------- ------------
Earnings per share: 4
Basic 1.45p 2.14p 116.28p
---------------- ---------------- ------------
Diluted 1.45p 2.14p 116.28p
---------------- ---------------- ------------
Consolidated interim statement of financial position
Notes 31 December 31 December 30 June
2022 2021 2022
GBP GBP GBP
Unaudited Unaudited Audited
Assets
Non-current assets
Investment in associate 3 34,894,534 11,314,470 35,430,000
------------ ------------- -----------
34,894,534 11,314,470 35,430,000
------------ ------------- -----------
Current assets
Trade and other receivables 49,555 40,976 56,953
Cash and cash equivalents 936,582 165,849 93,011
------------ ------------- -----------
986,137 206,825 149,964
------------ ------------- -----------
Total assets 35,880,671 11,521,295 35,579,964
------------ ------------- -----------
Equity and liabilities
Capital and reserves
attributable to equity
holders of the parent
Share capital 2,103,202 2,103,202 2,103,202
Capital redemption
reserve 711,117 711,117 711,117
Merger reserve 2,402,674 2,402,674 2,402,674
Retained profits 30,614,210 6,235,910 30,310,114
------------ ------------- -----------
35,831,203 11,452,903 35,527,107
------------ ------------- -----------
Current liabilities
Trade and other payables 49,468 68,392 52,857
49,468 68,392 52,857
------------ ------------- -----------
Total equity and
liabilities 35,880,671 11,521,295 35,579,964
------------ ------------- -----------
Consolidated interim cash flow statement
6 months 6 months 12 months
to 31 December to 31 December to 30
2022 2021 June
2022
GBP GBP
Unaudited Unaudited GBP
Audited
Cash flow from operating activities
Profit before taxation 304,096 450,350 24,432,815
Adjustments for:
Share of (profit) from associate (368,077) (497,890) (1,153,937)
Reversal of impairment in associate - - (23,391,701)
Finance income (874) (9) (36)
Corporation taxes recovered 17,904 - -
---------------- ---------------- --------------
Net cash outflow from operating activities
before changes in working capital (46,951) (47,549) (112,859)
(Increase) / Decrease in trade and
other receivables (10,506) 16,336 24,316
Increase / (Decrease) in trade and
other payables (3,389) 29,223 13,688
Net cash outflow used in operating
activities (60,846) (1,990) (74,855)
---------------- ---------------- --------------
Investing activities
Dividend received 903,543 - -
Interest received 874 9 36
Net cash inflow from investing activities 904,417 9 36
---------------- ---------------- --------------
Net movement in cash and cash equivalents
in the period 843,571 (1,981) (74,819)
Cash and cash equivalents at the
beginning of the period 93,011 167,830 167,830
Cash and cash equivalents at the
end of the period 936,582 165,849 93,011
---------------- ---------------- --------------
Consolidated interim statement of changes in equity
Share Capital redemption Merger Retained Total shareholders
capital reserve reserve surplus/ equity
GBP (deficit) GBP
GBP Unaudited GBP GBP Unaudited
Unaudited Unaudited Unaudited
At 1 July 2021 2,103,202 711,117 2,402,674 5,785,560 11,002,553
Profit for the 6 month period to 31
December 2021 - - - 450,350 450,350
Dividend paid to the Company's - - - - -
shareholders
Total comprehensive profit for the
period - - - 450,350 450,350
At 31 December 2021 2,103,202 711,117 2,402,674 6,235,910 11,452,903
----------- ------------------- ----------- ----------- -------------------
Profit for the 6 month period to 30
June 2022 - - - 24,006,422 24,006,422
Share of other comprehensive profit
of associate - - - 67,782 67,782
Total comprehensive profit for the
period - - - 24,074,204 24,074,204
At 30 June 2022 2,103,202 711,117 2,402,674 30,310,114 35,527,107
----------- ------------------- ----------- ----------- -------------------
Share Capital Merger Retained Total
capital redemption reserve surplus/ shareholders
reserve (deficit) equity
GBP GBP GBP GBP GBP
Unaudited Unaudited Unaudited Unaudited Unaudited
At 1 July 2022 2,103,202 711,117 2,402,674 30,310,114 35,527,107
Profit for the 6 month period to 31
December 2022 - - - 304,096 304,096
Dividend paid to the Company's shareholders - - - - -
----------- ------------ ----------- ----------- --------------
Total comprehensive profit for the
period - - - 304,096 304,096
----------- ------------ ----------- ----------- --------------
At 31 December 2022 2,103,202 711,117 2,402,674 30,614,210 35,831,203
----------- ------------ ----------- ----------- --------------
Notes to the interim financial statements
1. Corporate information
CMG is a company incorporated in England and Wales and is quoted
on the AIM market operated by London Stock Exchange plc.
2. Basis of preparation
These unaudited consolidated interim financial statements cover
the six month period from 1 July 2022 to 31 December 2022 including
the financial results of Sports Information Services (Holdings)
Limited ("SIS") for its six month period to 30 September 2022.
These consolidated interim financial statements of the Company
and its subsidiaries (the "Group") for the six months ended 31
December 2022 have been prepared in accordance with International
Financial Reporting Standards (IFRSs and IFRIC interpretations) as
adopted by the European Union and also in accordance with the
Companies Act 2006.
The accounting policies adopted for the preparation of these
unaudited interim financial statements are consistent with the
accounting policies adopted in the Group's financial statements for
the year ended 30 June 2022 and will remain so for the year ending
30 June 2023.
The financial information set out above does not constitute
statutory accounts as defined in section 434 of the Companies Act
2006. Statutory accounts for the year ended 30 June 2022, on which
the report of the auditors was unqualified and did not contain a
statement under section 498 of the Companies Act 2006, have been
filed with the Registrar of Companies.
New financial reporting requirements
The Group, including SIS, has applied no new financial reporting
standards for the first time in preparing its financial statements
for the six month period ended 31 December 2022.
Standards, interpretations and amendments to published standards
not yet effective
At the date of authorisation of these consolidated interim
financial statements, the IASB and IFRIC have issued the following
standard and interpretations which are effective for annual
accounting periods beginning on or after the stated effective date.
This standard is not effective for, and has not been applied in,
the preparation of these consolidated interim financial
statements:
-- IFRS 17: Insurance Contracts (effective as of 1 January
2023)
The Directors anticipate that the adoption of this standard will
not have a material impact on the Group's financial statements in
the period of initial adoption.
3. Investment in associate
Total
Group
GBP
Cost
At 1 July 2022 35,430,000
Additions - share of profits 368,077
Dividends received (903,543)
At 31 December 2022 34,894,534
-----------
The Group's interest in its associate, SIS, a company
incorporated in England and Wales, is held by Alternateport Limited
("Alternateport"). Alternateport holds an investment of 20.54% in
the equity share capital of SIS and is entitled to appoint a
director and alternate director to the SIS board. This right has
been exercised since acquisition. Alternateport is a wholly-owned
subsidiary of Catalyst Media Holdings Limited, a wholly-owned
subsidiary of the Company.
The Board has reviewed its valuation of the Company's investment
in SIS as at 31 December 2022 and has, in line with the Group's
accounting policies, decreased the value of its investment by the
amount of its share of profits for the period, less the value of
the dividend received. As a result, the investment is now carried
at a value of GBP34.9m.
Share of profit of associate* 30 September 31 December 31 December 30 June
2022 2022 2021 2022
SIS Total CMG share CMG share CMG share
GBP'000 GBP'000 GBP'000 GBP'000
Revenue:
SIS Betting Services 125,746 25,828 23,283 44,849
Total revenue 125,746 25,828 23,283 44,849
Operating profit/(loss)
from ongoing operations 1,929 396 616 1,430
Net interest receivable
/ (payable) 283 58 (1) -
Profit/(loss) before tax 2,212 454 615 1,430
Taxation (420) (86) (117) (276)
------------- ------------ ------------ ----------
Share of income/(loss)
after taxation 1,792 368 498 1,154
------------- ------------ ------------ ----------
Net income from associate 1,792 368 498 1,154
Other comprehensive income
Actuarial gain/(loss) - - - 104
Deferred tax - - - (36)
- - - 68
------------- ------------ ------------ ----------
Share of gross assets
and liabilities of associate
Gross assets 131,315 26,972 23,068 26,005
Gross liabilities (69,212) (14,216) (11,754) (13,617)
------------- ------------ ------------ ----------
Net equity 62,103 12,756 11,314 12,388
------------- ------------ ------------ ----------
* - The period covered by the associate's accounts is for the
six months to 30 September 2022. The revenues have been stated
excluding internal revenues.
4. Earnings per share
The calculation of the basic earnings per ordinary share of 10p
each in the capital of the Company ("Share") is based upon the
following:
6 months 6 months 12 months
to to to 30 June
31 December 31 December 2022
2022 2021 GBP
GBP GBP
Basic and Diluted
Earnings per share - pence 1.45p 2.14p 116.28p
Profit attributable to equity shareholders 304,096 450,350 24,456,772
Weighted average number of Shares
in issue 21,032,030 21,032,030 21,032,030
------------- ------------- ------------
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END
IR BLGDXXXDDGXC
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