TIDMLUD
RNS Number : 1245N
Ludorum PLC
26 September 2012
26 September 2012
LUDORUM PLC INTERIM RESULTS
Ludorum plc ("Ludorum" or the "Company"), the AIM-listed media
investment company, today announces its results for the half-year
ended 30 June 2012.
Highlights
Turnover generated in the period of GBP2.88m (2011: GBP2.95m), a
decrease of 2%
Consumer products revenues flat at GBP2.60m (2011: GBP2.60m)
Operating loss of GBP0.24m (2011: GBP0.41m), a 42% reduction
Chuggington now licensed for broadcast to 175 countries
Exciting new series in production for delivery in 2013 and
licensed to the BBC
"Pla-rail" toy train system successfully introduced in Japan in
July 2012
Die Cast "Stack Track" toy train systems successfully introduced
into the US in September 2012
Rob Lawes, Chief Executive, said:
"Although our consumer products revenues remained flat for the
comparable period, this was a solid performance given the
withdrawal from the market place of the "Interactive" plastic train
system during the period. We are encouraged by the early success of
the "Pla-rail" system, the successor to the Interactive system,
which has had a strong launch in Japan commencing in July 2012, and
the new "Stack Track" system with its launch in the US market
earlier this month. Revenues from both new product lines are not
reflected in the reporting period".
Contacts
Ludorum plc 020 8246 4010
Rob Lawes
Investec Investment Banking (NOMAD) 020 7597 4000
David Flin
Chief Executive's Review
Overview
Although our consumer products revenues remained flat for the
comparable period, this was a solid performance given the
withdrawal from the market place of our "Interactive" plastic train
system. We are encouraged by the early success of the "Pla-rail"
system, the successor to the Interactive system, which has had a
strong launch in Japan commencing in July 2012, and the new "Stack
Track" system has also made a strong start with its launch in the
US market this month. Revenues from both new product lines are not
reflected in this period and, alongside the wooden train system,
should drive strong sales for the remainder of 2012 and beyond.
It was pleasing to show a 42% reduction in operating losses to
GBP0.24m versus GBP0.41m in the prior period, reflecting our
continued focus on maximising profitability through overhead
management.
Chuggington
Chuggington is an action packed series of train adventures that
come to life in a vibrant modern world called Chuggington. Wilson
and his friends, Brewster and Koko, take on exciting challenges
that test their courage, speed and determination. Along the way,
they learn positive values and new skills empowering them to become
the best trainees they can be. To date we have created 92 x 10"
episodes and 46 x 4" shorter episodes.
We have concluded broadcast agreements with all leading
broadcasters in their respective territories in over 175 countries.
The series has established a highly successful ratings record in
many markets including the UK (BBC - Cbeebies), North America (The
Disney Channel), Germany (Super RTL), France (TF1), Japan (Fuji
-TV), Australia (ABC) and Canada (Treehouse). We have recently
concluded an agreement for Chuggington to be aired on Disney
Channel, India, commencing December 2012.
The first Chuggington series was started by Ludorum in 2006 and
has continually and successfully been on-air since 2008. We have
now commenced production on series 4, comprising 26 x 10" episodes
of new adventures that will be available for broadcast commencing
in September 2013. We are pleased to have concluded a deal with the
BBC for the new series and we are starting the process of licensing
the new series to our international broadcast partners. We are
anticipating strong demand for the new content.
Consumer Products
Our consumer revenues were flat during the period of review.
This reflects a period where the Interactive system developed by
RC2 was withdrawn from the market, and its replacement system,
Pla-rail, had not been launched. We also did not benefit in the
period from the launch of the new "Stack Track" system that has
been designed to enhance the existing die-cast range. We are
pleased to report that, post these results, both these systems have
had encouraging launches in their respective markets.
In addition to Tomy, we have a significant number of other
licensees across consumer products, home entertainment and
publishing.
Financial Review
Ludorum generated revenues of GBP2.88m for the first six months
of 2012 (2011: GBP2.95m), a 2% reduction over the first six months
of 2011. This reduction is mainly the result of slightly lower
reported broadcast revenues. Consumer products revenues
representing 90% of revenues, were consistent with the prior period
at GBP2.60m (2011: GBP2.60m). Broadcast revenues, which are
recognised on license period start dates, represented 9% of
revenues and reduced by GBP0.06m to GBP0.26m (2011: GBP0.32m).
Europe (including the UK) represented 44% of total revenues at
GBP1.28m, The Americas represented 41% of revenues at GBP1.18m and
Asia & Australasia 15% of revenues at GBP0.42m.
Gross profit decreased from to GBP1.15m, to GBP0.97m, largely
reflecting a re-classification of an overhead cost into marketing
costs and an increased amortisation charge which resulted from the
greater number of completed episodes.
Total administrative costs were GBP1.21m a reduction of 23% over
the prior year cost of GBP1.57m.
The operating loss for the six-month period was GBP0.24m, a 42%
reduction on the GBP0.41m operating loss for the six months to 30
June 2011. This was mainly the result of improved overhead
management.
Capital expenditure on Chuggington during the period was
GBP0.36m (2011: GBP0.79m), a decrease of GBP0.43m. This decrease
was the result of a lull in production while the concept and
scripts for the new series were being developed.
As at 30 June 2012 the Company had cash and cash equivalents of
GBP0.34m (2011: GBP0.25m) and bank overdrafts of GBP0.73m (2011:
GBP0.72m). In March 2012, the Company renewed its GBP0.75m
overdraft facility with Coutts & Co.
In March 2012, the Company redeemed at par, GBP1.50m of loan
notes, being all the loan notes in issue. At the same time the
Company issued GBP2.75m of new loan notes. The new loan notes are
held by client funds of Downing LLP and D C Thomson & Co
Limited. The new loan notes are repayable in March 2017. If the
Company redeems the new loan notes within the next two years the
redemption will be GBP1.25 per GBP1 of loan notes. If the new loan
notes are redeemed after two years the loan notes are redeemable at
par. The coupon on all new loan notes is the higher of 7.5% or 3%
above LIBOR for the next three years. After the three years the
coupon is 12.5%.
On the basis of enquiries made by the Directors and in the light
of current financial projections and facilities available, the
Directors have reasonable expectation that the Group has adequate
resources to continue in operational existence for the foreseeable
future. Accordingly, we continue to adopt the going concern basis
in preparing the accounts.
On 28 June 2012 we announced that our accounting reference date
would change to 31 March. Accordingly, the next consolidated
accounts for the Company will be prepared for the fifteen month
period ending 31 March 2013. The change has been made so that the
Company's accounting year end is the same as that of its master toy
licence partner, Tomy Company Limited.
Board Changes
Two directors, Charlie Caminada and David Maloney, resigned with
effect from 28 June 2012. On behalf of the Board and the Company, I
would like to thank Charlie Caminada, a co-founder of Ludorum, and
a colleague and friend of 23 years standing, for his excellent
contribution since our launch in 2006. We wish him all the very
best following his retirement in June. We would also like to thank
David Maloney for his significant contributions over his six years
as a non-executive director.
Richard Hall was appointed, with effect from 28 June 2012, as a
non-executive director. We are delighted to welcome Richard who
also serves as a board member of D C Thomson & Co Limited.
Outlook
We remain committed to building Chuggington into the premier
evergreen pre-school global train property. Chuggington is already
established as a durable and well accepted brand in markets
throughout the globe, and we feel there are excellent opportunities
to make this strategic aim a reality as we look to steadily build
on our experience and the brand's successes to-date.
Ludorum plc
Unaudited consolidated statement of comprehensive income
for the six months ended 30 June 2012
Six months Six months
Notes ended ended
30 June 30 June
2012 2011
GBP000 GBP000
-------------------------------- -------- ----------- -----------
Continuing operations
-------------------------------- -------- ----------- -----------
Revenue 2 2,880 2,949
-------------------------------- -------- ----------- -----------
Cost of sales (1,910) (1,797)
-------------------------------- -------- ----------- -----------
Gross profit 970 1,152
-------------------------------- -------- ----------- -----------
Administrative expenses (1,210) (1,565)
-------------------------------- -------- ----------- -----------
Operating loss (240) (413)
-------------------------------- -------- ----------- -----------
Finance cost - bank and
loan interest (54) (43)
-------------------------------- -------- ----------- -----------
Finance income - bank interest - -
-------------------------------- -------- ----------- -----------
Net finance cost (54) (43)
-------------------------------- -------- ----------- -----------
Loss before taxation (294) (456)
-------------------------------- -------- ----------- -----------
Taxation (51) (95)
-------------------------------- -------- ----------- -----------
Loss for the period (345) (551)
-------------------------------- -------- ----------- -----------
Other comprehensive income:
foreign exchange differences 3 5
-------------------------------- -------- ----------- -----------
Total comprehensive income
for the period (342) (546)
-------------------------------- -------- ----------- -----------
Loss per share (basic and
diluted) (3.5p) (5.7p)
-------------------------------- -------- ----------- -----------
Ludorum plc
Unaudited consolidated balance sheet as at 30 June 2012
Notes 30 June 31 December 30 June
2012 2011 2011
--------------------------- ------ --------- ------------ ---------
GBP000 GBP000 GBP000
--------------------------- ------ --------- ------------ ---------
Assets
--------------------------- ------ --------- ------------ ---------
Non -current
assets
--------------------------- ------ --------- ------------ ---------
Property, plant
and equipment 19 36 53
--------------------------- ------ --------- ------------ ---------
Intangible assets 3 3,619 3,704 3,304
--------------------------- ------ --------- ------------ ---------
3,638 3,740 3,357
--------------------------- ------ --------- ------------ ---------
Current assets
--------------------------- ------ --------- ------------ ---------
Trade and other
receivables 1,755 2,498 1,702
--------------------------- ------ --------- ------------ ---------
Cash and cash
equivalents 337 501 252
--------------------------- ------ --------- ------------ ---------
2,092 2,999 1,954
--------------------------- ------ --------- ------------ ---------
Liabilities
--------------------------- ------ --------- ------------ ---------
Current Liabilities
--------------------------- ------ --------- ------------ ---------
Income tax payable (16) (23) (18)
--------------------------- ------ --------- ------------ ---------
Trade and other
liabilities (2,768) (4,463) (5,983)
--------------------------- ------ --------- ------------ ---------
Borrowings 4 (734) (999) (723)
--------------------------- ------ --------- ------------ ---------
(3,518) (5,485) (6,724)
--------------------------- ------ --------- ------------ ---------
Net current (liabilities)
/ assets (1,426) (2,486) (4,770)
--------------------------- ------ --------- ------------ ---------
Non - current
liabilities
--------------------------- ------ --------- ------------ ---------
Borrowings 4 (2,750) (1,500) (1,500)
--------------------------- ------ --------- ------------ ---------
Net (liabilities)
/ assets (538) (246) (2,913)
--------------------------- ------ --------- ------------ ---------
Shareholders'
equity
--------------------------- ------ --------- ------------ ---------
Ordinary shares 88 88 88
--------------------------- ------ --------- ------------ ---------
Deferred shares 50 50 50
--------------------------- ------ --------- ------------ ---------
Share premium 9,296 9,296 9,281
--------------------------- ------ --------- ------------ ---------
Share based payments
reserve 2,262 2,212 166
--------------------------- ------ --------- ------------ ---------
Foreign currency
translation (11) (14) 10
--------------------------- ------ --------- ------------ ---------
Accumulated losses (12,223) (11,878) (12,508)
--------------------------- ------ --------- ------------ ---------
Total shareholders'
equity (538) (246) (2,913)
--------------------------- ------ --------- ------------ ---------
Ludorum plc
Unaudited statement of changes in shareholders' equity
Share Share Accumulated Share-based Foreign Total
Capital Premium losses payments currency Shareholder
reserve translation (deficit)/
Equity
--------------------- --------- --------- -------------- ------------ ------------- -------------
30 June 2012 June June June June June June
12 12 12 12 12 12
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
--------------------- --------- --------- -------------- ------------ ------------- -------------
At 1 January
2012 138 9,296 (11,878) 2,212 (14) (246)
--------------------- --------- --------- -------------- ------------ ------------- -------------
Loss for the
period - - (345) - - (345)
--------------------- --------- --------- -------------- ------------ ------------- -------------
Other comprehensive
income:
Foreign exchange
differences - - - - 3 3
--------------------- --------- --------- -------------- ------------ ------------- -------------
Total comprehensive
income
for the period
to 30 June 2012 - - (345) - 3 (342)
--------------------- --------- --------- -------------- ------------ ------------- -------------
Transactions
with owners
--------------------- --------- --------- -------------- ------------ ------------- -------------
Charge relating
to incentive
option plan - - - 50 - 50
--------------------- --------- --------- -------------- ------------ ------------- -------------
At 30 June 2012 138 9,296 (12,223) 2,262 (11) (538)
--------------------- --------- --------- -------------- ------------ ------------- -------------
Share Share Accumulated Share-based Foreign Total
Capital Premium losses payments currency Shareholder
reserve translation (deficit)/
Equity
--------------------- --------- --------- -------------- ------------ ------------- -------------
30 June 2011 June June June June June June
11 11 11 11 11 11
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
--------------------- --------- --------- -------------- ------------ ------------- -------------
At 1 January
2011 138 9,281 (11,957) 105 5 (2,428)
--------------------- --------- --------- -------------- ------------ ------------- -------------
Loss for the
period - - (551) - - (551)
--------------------- --------- --------- -------------- ------------ ------------- -------------
Other comprehensive
income:
Foreign exchange
differences - - - - 5 5
--------------------- --------- --------- -------------- ------------ ------------- -------------
Total comprehensive
income
for the period
to 30 June 2011 - - (551) - 5 (546)
--------------------- --------- --------- -------------- ------------ ------------- -------------
Transactions
with owners
--------------------- --------- --------- -------------- ------------ ------------- -------------
Charge relating
to incentive
option plan - - - 61 - 61
--------------------- --------- --------- -------------- ------------ ------------- -------------
At 30 June 2011 138 9,281 (12,508) 166 10 (2,913)
--------------------- --------- --------- -------------- ------------ ------------- -------------
Ludorum plc
Unaudited consolidated cash flow statement for the six months
ended 30 June 2012
Six months Six months
ended ended
30 June 30 June
2012 2011
GBP000 GBP000
-------------------------------- ----------- -----------
Cash flows from operating
activities
-------------------------------- ----------- -----------
Cash (used in) / generated
by operations (677) 210
-------------------------------- ----------- -----------
Interest received - -
-------------------------------- ----------- -----------
Interest paid (54) (43)
-------------------------------- ----------- -----------
Taxation paid (58) (93)
-------------------------------- ----------- -----------
Net cash (used in) / generated
by operating activities (789) 74
-------------------------------- ----------- -----------
Cash flows from investing
activities
-------------------------------- ----------- -----------
Purchase of property, plant
and equipment - (17)
-------------------------------- ----------- -----------
Investment in intangible
assets (360) (785)
-------------------------------- ----------- -----------
Net cash used in investing
activities (360) (802)
-------------------------------- ----------- -----------
Cash flows from financing
activities
-------------------------------- ----------- -----------
Increase in loans 1,250 -
-------------------------------- ----------- -----------
Net cash generated from 1,250 -
financing activities
-------------------------------- ----------- -----------
Net increase / (decrease)
in cash and cash equivalents 101 (728)
-------------------------------- ----------- -----------
Cash, cash equivalents
and bank overdraft at 1
January (498) 257
-------------------------------- ----------- -----------
Cash, cash equivalents
and bank overdraft at 30
June (397) (471)
-------------------------------- ----------- -----------
Ludorum plc
Notes to the consolidated interim financial statements for the
six months ended 30 June 2012
1. Accounting policies
General Information
The Company is a public limited company incorporated and
domiciled in the United Kingdom. The address of its registered
office is 2B River Court, 27 Brewhouse Lane, Putney Wharf, London
SW15 2JX. The registered number is 5595899. This Company is listed
on AIM.
The condensed consolidated interim financial information was
approved for issue on 26 September 2012.
Basis of preparation
The condensed consolidated interim financial information should
be read in conjunction with the annual financial statements for the
year ended 31 December 2011, which have been prepared in accordance
with IFRSs.
The condensed consolidated interim financial information has not
been reviewed or audited by the Company's auditors and does not
constitute statutory accounts within the meaning of section 434 of
the Companies Act 2006. Statutory accounts for the year ended 31
December 2011 were approved by the Board for issue on 23 March 2012
and have been delivered to the Registrar of Companies. The
auditors' report on those accounts was unqualified, did not contain
an emphasis of matter paragraph and did not contain any statement
under sections 498 (2) or (3) of the Companies Act 2006.
Accounting policies
The accounting policies applied are consistent with those of the
annual financial statements for the year ended 31 December 2011, as
described in those financial statements.
2. Segmental analysis
The Group currently has one operating segment, the development
and exploitation of its rights in Chuggington. Further information
about revenue derived from the Group's product lines is set out
below. Management information used by the Chief Operating Decision
Maker ("CODM") is in a format similar to the Consolidated Statement
of Comprehensive Income and Consolidated Balance Sheet. The CODM is
considered to be the Board of Directors.
Revenue by product line
Six months Six months
ended ended
30 June 30 June
2012 2011
GBP000 GBP000
------------------- ----------- -----------
Television 258 323
------------------- ----------- -----------
Consumer Products 2,596 2,601
------------------- ----------- -----------
Other 26 25
------------------- ----------- -----------
2,880 2,949
------------------- ----------- -----------
Geographical analysis of revenue by location of customer
Six months Six months
ended ended
30 June 30 June
2012 2011
GBP000 GBP000
------------------------- ----------- -----------
United Kingdom, Europe,
Middle East & Africa 1,276 1,373
------------------------- ----------- -----------
Asia & Australasia 421 574
------------------------- ----------- -----------
Americas 1,183 1,002
------------------------- ----------- -----------
2,880 2,949
------------------------- ----------- -----------
All material assets are located in the UK.
3. Intangible assets
Capitalised
development
costs
-------------------------------- -------------
GBP000
-------------------------------- -------------
30 June 2012
-------------------------------- -------------
Cost
-------------------------------- -------------
At 1 January 2012 4,768
-------------------------------- -------------
Additions 259
-------------------------------- -------------
At 30 June 2012 5,027
-------------------------------- -------------
Accumulated amortisation
-------------------------------- -------------
At 1 January 2012 1,064
-------------------------------- -------------
Charge for the period 344
-------------------------------- -------------
At 30 June 2012 1,408
-------------------------------- -------------
Net book value at 30 June 2012 3,619
-------------------------------- -------------
Capitalised
development
costs
-------------------------------- -------------
GBP000
-------------------------------- -------------
30 June 2011
-------------------------------- -------------
Cost
-------------------------------- -------------
At 1 January 2011 3,756
-------------------------------- -------------
Additions 327
-------------------------------- -------------
At 30 June 2011 4,083
-------------------------------- -------------
Accumulated amortisation
-------------------------------- -------------
At 1 January 2011 519
-------------------------------- -------------
Charge for the period 260
-------------------------------- -------------
At 30 June 2011 779
-------------------------------- -------------
Net book value at 30 June 2011 3,304
-------------------------------- -------------
4. Borrowings
The following borrowings are included in trade and other
liabilities:
30 June 31 December 30 June
2012 2011 2011
--------------------- -------- ------------ --------
GBP000 GBP000 GBP000
--------------------- -------- ------------ --------
Bank overdraft 734 999 723
--------------------- -------- ------------ --------
Loans 2,750 1,500 1,500
--------------------- -------- ------------ --------
3,484 2,499 2,223
--------------------- -------- ------------ --------
Undrawn borrowing
facilities
--------------------- -------- ------------ --------
Bank overdraft 16 56 27
--------------------- -------- ------------ --------
Fixed interest rate - - -
loan
--------------------- -------- ------------ --------
16 56 27
--------------------- -------- ------------ --------
The Company has overdraft facilities of GBP750,000 from Coutts
& Co. The overdraft is secured by a first charge over the
Company's assets (including the Company's intellectual
property).
In March 2010 the Company issued GBP1.5m of loan notes. These
loan notes were redeemed in March 2012 at which time the Company
issued GBP2.75m of new loan notes. The new loan notes are
redeemable within five years. If the Company redeems the loan notes
within two years the redemption will be GBP1.25 per GBP1 of loan
notes. If the loan notes are redeemed after two years the loan
notes are redeemable at par. The interest payable on the loan notes
is the greater of 7.5% or 3% above LIBOR for the first three years.
After three years, the interest rate is 12.5%. The new loan notes
are secured by a second charge over the Company's assets (and a
charge over the assets of Ludorum Enterprises Limited, a wholly
owned subsidiary of the Company). GBP1.5m of the new loan notes are
held by client funds of Downing LLP. GBP1.25m of the new loan notes
are held by D C Thomson & Co Limited.
5. Related party transactions
Included in trade and other liabilities at 30 June 2012 is
GBP145,442 in respect of unpaid remuneration (and the associated
employer's National Insurance payable) owed to directors of the
Company (30 June 2011: GBP101,220, 31 December 2011: GBP176,150).
Also included in trade and other liabilities at 30 June 2012 are
accrued pension costs owed to the directors of GBP70,544 (30 June
2011: GBP116,342 December 2011: GBP143,714).
6. Commitments
In 2007 the Company entered into an agreement with a toy
manufacturer under the terms of which the toy manufacturer agreed
to fund 50% of the production cost of the Company's animated series
"Chuggington" in return for which it has a global master toy
licence and the right to participate in the net profit of the
property. The Company and the toy manufacturer have now jointly
funded the production of three series, comprising 92 episodes of
Chuggington. The Company and the toy manufacturer have agreed to
jointly fund a fourth series of 26 episodes of 10 minutes each. The
budget is GBP4.4m. Production of this series commenced in 2012.
In April 2012 the Company entered into an agreement with
Shanghai Motion Magic Digital Entertainment Inc ("Motion Magic")
under the terms of which Motion Magic is to provide animation and
editing services for the production of the fourth series of
Chuggington. The Company is committed to pay RMB 12.631m
(GBP1.229m). Under the terms of the agreement with the toy
manufacturer described above, 50% of the amount payable to Motion
Magic will be refunded to the Company by the toy manufacturer.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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