Interim Results
24 Juni 2004 - 9:41AM
UK Regulatory
RNS Number:0921A
Galleon Holdings PLC
24 June 2004
Galleon Holdings plc
Interim results, for the six months ended 31 March 2004
Galleon Holdings Plc ("Galleon" or "the Company") the AIM listed cross media
company, announces its Interim Results for the six months ended 31 March 2004.
Interim results for the SIX months ended 31 MARCH 2004
Chairman's statement
I am pleased to present the interim financial results for the Group for the six
months ended 31 March 2004. As previously announced the accounting period will
this time run through to 30 September 2004, for which time a full set of results
will be published. In the six months under review the loss on ordinary
activities after taxation was #509,000, which included #274,000 relating to the
amortisation of goodwill.
I am delighted to be able to report that we have continued to make progress
during the period. Our strategic objective to build a significant intellectual
property rights (IPR) portfolio by creating, developing and acquiring rights has
seen the company very active in this pursuit.
J. Christopher Entertainment
I announced on 15 June 2004 that we had successfully acquired a 50 per cent
stake in J Christopher Entertainment. The company is an animation studio and
facility based in Los Angeles, California. The other 50 per cent shareholder is
Chris Henderson an ex Disney producer whose credits include 101 Dalmatians,
Hercules, Hunchback of Notre Dame and Peter Pan's Return to Neverland. Chris has
assembled a team of experienced talent that includes scriptwriters, directors,
artists and designers who have worked for the major Hollywood studios, Disney,
Warner Bros., Universal and Dreamworks.
This team has now taken over the production of our series Oggies and the first
eleven-minute episode will be completed in September 2004. The studio also
brings two projects they are currently working on for third parties.
I believe that this acquisition gives Galleon a tremendous opportunity to
increase our output, build our portfolio and enhance our profile in the USA, the
world's biggest market place for our business.
Croco Worldwide Sourcing Limited
In May 2004 I announced the acquisition of the entire share capital of Croco
Worldwide Sourcing Limited. Croco specialises in premiums and promotions for a
client list that includes Coca-Cola, Kellogg's, Burger King, Nestle and
Gillette. Shortly after completing the transaction the company signed three
contracts with Coca-Cola for promotions in Hungary, Estonia and the Czech
Republic.
Croco has a history of creating innovative promotion and premium offers for
blue-chip clients. It also sources and supplies the products mainly from
factories in the Far East where it has many established relationships.
The addition of the Galleon IPR portfolio to the Croco business provides an
opportunity for both companies to increase their visibility, turnover and
profitability.
I feel it is appropriate to point out that both of these acquisitions were
satisfied in full by the payment of Galleon shares at par, once again
demonstrating the belief in our strategic approach to the ownership of IPR, by
others.
A4 Publications and Probe Media
I am happy to report that both businesses have made an improvement since my last
statement. The editorial and design team for A4 have enhanced both the look and
the content of the publications. The advertising sales in the USA are starting
to come through and we are currently recruiting for an advertising sales
executive in the UK to work out of our London office.
Probe has come through a difficult trading period and is now showing much better
prospects. A number of new clients have been gained during this period including
Motown Records a subsidiary of music giant Universal Music Group, the record
labels Ministry of Sound and Big Brother who are responsible for the band Oasis.
Probe has also won contracts for Heart FM and the promotion of the Duran Duran
tour.
Oggies, Astro Knights, Peppers Patrol
As already mentioned, Oggies is now being produced by our 50 per cent subsidiary
J Christopher Entertainment in Hollywood. The studio has undertaken redesigns of
the characters and setting. The new artwork has started to come through and has
been described as "truly classical".
The licensing programme continues to attract attention across the globe with
approaches coming from licensing agencies keen to represent the series.
Astro Knights is also in production in Sweden. The producers, Jaguar Media
Entertainment have also reported to us that the licensing programme will be
officially launched in October 2004.
This series is a Galleon/Sanctuary Group PLC 50/50 joint venture and has
retained the rights for UK TV distribution, licensing, and worldwide music
publishing.
Peppers Patrol our joint venture with Coolebah Limited has also made progress
during the period. Siriol animation studio in Cardiff have been selected to
undertake the development of the series and work has already begun. Siriol have
recently produced the new Fireman Sam series for S4C television and HIT
Entertainment.
We continue to work with the Metropolitan Police who will be using PC Pepper to
put out messages of stranger danger and road safety to young children. A recent
presentation to a number of police forces nationally is also proving to be
successful with them joining in with the Peppers Patrol awareness programme.
CHANGE OF ADVISERS
I am delighted to announce the appointment of Durlacher as nominated adviser and
brokers to the group, with immediate effect.
Outlook
We have remained focused on our strategic objective and I firmly believe that we
have added tremendous strength to our business during this period. The animation
market place is waiting for the next successful children's property and Galleon
is more than capable and well positioned to provide one. Our latest acquisitions
give us the added opportunity of increasing our turnover and profitability
whilst not being totally dependent on in-house properties. The addition of our
portfolio to these businesses makes for a very interesting and exciting future
for the group. I am confident that the second half of 2004 and calendar year
2005 will herald a big improvement in Galleon's financial performance.
In conclusion I should like to thank shareholders for their continued support
and I look forward to communicating further positive developments over the
balance of 2004 and beyond.
James Driscoll, MBE
CHAIRMAN
24 June 2004
For further information contact:
Jim Driscoll Peter Binns
Chairman Binns & Co PR Limited
Galleon Holdings plc Tel: 020 7153 1477
Tel: 01384 350 210
Profit and Loss account
For the six months ended 31 March 2004
Six months Six months Year ended 31
ended 31 March ended 30 March
2004 September 2003
2003
Note Unaudited Unaudited Audited
#'000 #'000 #'000
Turnover 470 329 1,207
Cost of sales (448) (275) (883)
------- ------- ------
Gross profit 22 54 324
Other administrative (239) (377) (1,186)
expenses
Impairment and (274) (274) (7,823)
amortisation of ------- ------- ------
goodwill
Administrative expenses (513) (651) (9,009)
Operating loss prior to (217) (323) (862)
impairment and
amortisation of
goodwill
Impairment and (274) (274) (7,823)
amortisation of ------- ------- ------
goodwill
Operating loss (491) (597) (8,685)
Share of operating profit - 5 (64)
/(loss) of associate
Amortisation of purchased - (5) (70)
goodwill in associate
Provision for unrealised (12) - -
profit in Joint Venture
Net interest (6) (12) (14)
------- ------- ------
Loss on ordinary
activities before
taxation (509) (609) (8,833)
Tax on loss on ordinary 2 - - -
activities
------- ------- ------
Loss on ordinary (509) (609) (8,833)
activities after taxation ======= ======= ======
and loss for the
financial period
Basic loss per ordinary 3 (0.1)p (0.1)p (1.1)p
share
Consolidated balance sheet at 31 March 2004
At 31 At 30 September At 31 March
March 2002 2003
2004 Unaudited Audited
Unaudited #'000 #'000
#'000
Fixed assets
Intangible
assets
Goodwill 4,202 4,476 4,750
Other 2 2 2
-------- -------- ------
4,204 4,478 4,752
------- -------- ------
Tangible assets 44 58 70
Investments Associates and 70 70 70
joint ventures
Other 22 22 26
investments ------- -------- ------
92 92 96
------- -------- ------
------- -------- ------
4,340 4,628 4,918
------- -------- ------
Current assets
Stocks and work 89 19 18
in progress
Debtors 1,029 868 779
Cash at bank and 84 68 4
in hand ------- -------- ------
1,202 955 801
Creditors:
amounts falling
due within one
year (829) (950) (807)
------- -------- ------
Net current 373 5 (6)
assets/ ------- -------- ------
(liabilities)
Total assets less 4,713 4,633 4,912
current
liabilities
Creditors:
amounts falling
due after
more than one (5) (3) (5)
year
Provisions for (109) (98) (98)
liabilities and
charges ------- ------ ------
4,599 4,532 4,809
======= ====== ======
Capital and
reserves
Called up share 9,068 8,488 8,150
capital
Share premium 1,332 1,336 1,342
account
Other reserves - 6,338 6,338
Profit and loss (5,801) (11,630) (11,021)
account ------- -------- --------
Shareholders' 4,599 4,532 4,809
funds ======= ======== ========
Consolidated cash flow statement
For the six months ended 31 March 2004
Note Six months Six months Year ended
ended 31 March ended 30 31 March
2004 September 2003 2003
Unaudited Unaudited Audited
#'000 #'000 #'000
Net cash outflow from 6 (457) (261) (694)
operating activities ------- ------- -------
Returns on investments and
servicing of finance
Interest received - - 4
Interest paid (5) (10) (14)
Hire purchase interest (1) (2) (4)
Net cash outflow from
returns on ------- ------- -------
investments and servicing (6) (12) (14)
of finance ------- ------- -------
Capital expenditure
Purchase of tangible fixed (12) - (16)
assets
Purchase of intangible - - (1)
fixed assets
Payments to acquire fixed - - (30)
asset investments
Proceeds from sale of fixed - - 2
asset investments ------- ------- -------
Net cash outflow from (12) - (45)
capital expenditure ------- ------- -------
Net cash outflow before (475) (273) (753)
financing
Financing
Issue of shares 580 338 -
Expenses paid in connection (4) (6) -
with share issues
Capital element of finance (8) (15) (40)
leases ------- ------- -------
Net cash inflow/(outflow) 568 317 (40)
from financing ------- ------- -------
------- ------- -------
Increase/(decrease) in 93 44 (793)
cash ======= ======= =======
1. RESULTS
The results for the six months ended 31 March 2004 are neither audited nor
reviewed and do not constitute statutory accounts within the meaning of the
Companies (Northern Ireland) Order 1986. They have been prepared on the basis of
accounting policies consistent with those used in the annual accounts for the
year ended 31 March 2003. The statutory accounts for the year ended 31 March
2003 have been given an unqualified audit report and have been filed with the
Registrar of Companies. The interim accounts for the six months to 30 September
2003 were unaudited.
2. TAXATION
In view of the Company's tax losses carried forward, there is no tax charge
included in the twelve months under review.
3. LOSS PER SHARE
Loss per share has been calculated in accordance with FRS14 based on 884,070,441
ordinary shares of 1 pence each being the weighted average of those in issue
during the six months ended 31 March 2004.
4. DIVIDENDS
The Company will not be declaring an interim dividend.
5.CONTINGENT LIABILITY
The Company has been involved jointly with Glencar Mining plc in civil
litigations in the Irish courts against Mayo County Council. The Company has
withdrawn its action, although Glencar Mining plc has decided to proceed with an
appeal to the Supreme Court. Under an agreement reached between the Company and
Glencar Mining plc dated 23 May 2000, the Company will still be liable for the
legal costs but restricted to a maximum of Irish #60,000. This amount has been
provided in the accounts as at 31 March 2004. As this agreement is between the
Company and Glencar Mining plc, the Company has joint and several liability
regarding legal costs in the event, that there is a shortfall unpaid by Glencar
Mining plc.
6. NOTE TO CASH FLOW STATEMENT
Reconciliation of operating loss to net cash outflow from operating activities:-
Six months Six months Year ended
ended 31 March ended 30 31 March
2004 September 2003 2003
Unaudited Unaudited Audited
#'000 #'000 #'000
Operating loss (491) (597) (8,685)
Loss of disposal of tangible - - 2
fixed assets
Depreciation of tangible 26 12 45
fixed assets
Amortisation of intangible - - 5
fixed assets
(Decrease)/increase in (1) 4 70
provision against
investments
Reversal of provisions - - (112)
Amortisation of goodwill 274 274 7,823
Increase in work in (70) (1) (1)
progres
(Increase)/decrease in (161) (89) 134
debtors
(Decrease)/increase in (34) 136 25
creditors ------ ------ ------
Net cash outflow from (457) (261) (694)
operating activities ====== ====== ======
7. POST BALANCE SHEET EVENTS
On 5 May 2004 the company acquired the entire issue share capital of Croco
Worldwide Sourcing Limited for a consideration totalling 75 million ordinary
shares of one pence each issued at par value.
For further information contact: Jim Driscoll
Chairman
Galleon Holdings plc
Tel: 01384 350 210
Peter Binns
Binns & Co PR Limited
Tel: 020 7153 1477
This information is provided by RNS
The company news service from the London Stock Exchange
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