TIDMLUD
RNS Number : 5054W
Ludorum PLC
30 December 2013
30 December 2013
LUDORUM PLC INTERIM RESULTS
Ludorum plc, the AIM-listed media investment company, today
announces its results for the half-year ended 30 September,
2013.
Highlights for the period 1 April 2013 to 30 September 2013
Turnover GBP2.53 m (2012: GBP3.36 m)
Broadcast income GBP0.43 m (2012: GBP0.28 m)
Consumer products revenues GBP2.09 m (2012: GBP3.07 m)
Operating profit GBP0.01 m (2012: GBP0.39 m)
Administrative expenses GBP0.82 m (2012: GBP1.05 m)
Chuggington has now been licensed for broadcast to 175
countries
A new series of 26 episodes is completing production for
delivery in 2013-14 with broadcast having commenced on the BBC
(UK), Disney Channel (US) and SRTL (Germany) in the fourth quarter
of 2013.
Rob Lawes, Chief Executive, said:
"This has been a challenging period for the Company from a
financial perspective and is reflected in the modest operating
profit. It's a very competitive marketplace but Chuggington is
proving to be a durable property and providing a solid global
platform to build on. There are some exciting developments taking
place. Firstly, our new Chuggington series, the first new content
since Spring 2011, has just started to air on a global basis and is
generating strong ratings. Secondly, our master toy partner, Tomy,
has introduced new, exciting products which have appeared on store
shelves throughout the world since autumn 2013.
Contacts
Ludorum plc 020 8246 4010
Rob Lawes
Investec Investment Banking (NOMAD) 020 7597 4000
David Flin
Andrew Pinder
Chief Executive's Review
Overview
This has been a challenging period for the Company from a
financial perspective and is reflected in the modest operating
profit. We have almost completed the production of series 4 of
Chuggington, being episodes 93 to 118. This is the first new
content we have delivered to broadcasters since Spring 2011. This
new season delivers even more adventure and excitement and
introduces many new locations and characters, and although early
days, the first 13 episodes have already commenced broadcast in the
UK, US and Germany and are generating strong ratings. The next 13
episodes will commence broadcast in the first quarter of 2014. We
are also in pre-production for further episodes for 2015
delivery.
Both Tomy's StackTrack and Wooden Systems have enjoyed some good
successes at retail and new characters and sets are planned for
introduction in 2014. Tomy is also working hard on the development
of a plastic motorized system that will launch in 2015. In
anticipation of the introduction of this new system, Tomy has
almost completed the withdrawal of their "Interactive" plastic
train system from the market place during this financial
period.
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 are in production on a
further 26 x 10" episodes with delivery of the first 13 episodes
completed in September 2013 and the balance in the first quarter of
2014.
The first Chuggington series was created by Ludorum in 2006 and
has continually and successfully been on air since 2008. 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).
Financial Review
Ludorum generated revenues of GBP2.53m for the first six months
ending 30 September 2013 (2012: GBP3.36m), a 25% reduction over the
first six months of 2012. This reduction is mainly the result of
lower reported consumer product revenues of GBP2.09m (GBP3.07m).
Consumer products revenues represented 83% of revenues. Broadcast
revenues represented 17% of revenues at GBP0.43m (2012:
GBP0.28m).
Europe (including the UK) represented 45% (2012: 46%) of total
revenues at GBP1.14m, The Americas represented 38% (2012: 34%) of
revenues at GBP0.97m and Austral/Asia 16% (2012: 20%) of revenues
at GBP0.41m.
Gross profit decreased from to GBP1.44m, to GBP0.82m largely
reflecting the decrease in consumer products revenues.
Total administrative costs were GBP0.82m a reduction of 22% over
the prior period cost of GBP1.05m. The operating profit for the
six-month period was GBP0.01m versus a GBP0.39m for the prior
period.
Capital expenditure on Chuggington during the period was
GBP0.39m (GBP0.62m in the six months to 30 September 2012), a
decrease of GBP0.23m.
As at 30 September 2013, the Company had cash and cash
equivalents of GBP0.44m (30 September 2012 GBP0.28m) and bank
overdrafts of GBP0.99m (30 September 2012: GBP0.67m). In June 2013,
the Company renewed its GBP0.75m overdraft facility with Coutts
& Co. Coutts & Co has temporarily increased the Company's
overdraft facility from GBP0.75m to GBP1m until 28 February 2014
and then GBP0.9m until 31 March 2014, at which date it will revert
to GBP0.75m.
In March 2012, the Company issued GBP2.75m of loan notes. The
loan notes are held by client funds of Downing LLP and D C Thomson
& Co Limited. The loan notes are repayable in March 2017. If
the Company redeems the loan notes within the first 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 coupon on all notes is the higher of 7.5% or 3% above
LIBOR for the first 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.
Outlook
We remain committed to building Chuggington into the premier
evergreen pre-school global train property. Chuggington has proved
to be well established and durable and is an accepted brand in
markets globally. We are excited about the introduction of our new
series content alongside some great toy product lines, 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 September 2013
Six months Six months
Notes ended ended
30 September 30 September
2013 2012
GBP000 GBP000
--------------------------------------- -------- -------------- --------------
Continuing operations
--------------------------------------- -------- -------------- --------------
Revenue 2 2,526 3,363
--------------------------------------- -------- -------------- --------------
Cost of sales (1,704) (1,922)
--------------------------------------- -------- -------------- --------------
Gross profit 822 1,441
--------------------------------------- -------- -------------- --------------
Administrative expenses (817) (1,047)
--------------------------------------- -------- -------------- --------------
Operating profit 5 394
--------------------------------------- -------- -------------- --------------
Finance cost - bank and loan interest (67) (57)
--------------------------------------- -------- -------------- --------------
Finance income - bank interest - -
--------------------------------------- -------- -------------- --------------
Net finance cost (67) (57)
--------------------------------------- -------- -------------- --------------
(Loss) / profit before taxation (62) 337
--------------------------------------- -------- -------------- --------------
Taxation (18) (57)
--------------------------------------- -------- -------------- --------------
(Loss) / profit for the period (80) 280
--------------------------------------- -------- -------------- --------------
Other comprehensive income: foreign (2) -
exchange differences
--------------------------------------- -------- -------------- --------------
Total comprehensive income for
the period (82) 280
--------------------------------------- -------- -------------- --------------
Basic (loss) / earnings per share (0.81)p 2.8p
--------------------------------------- -------- -------------- --------------
Diluted (loss) / earnings per
share (0.80)p 2.8p
--------------------------------------- -------- -------------- --------------
Ludorum plc
Unaudited consolidated balance sheet as at 30 September 2013
Notes 30 September 31 March 30 September
2013 2013 2012
------------------------------ ------ ------------- ---------- -------------
GBP000 GBP000 GBP000
------------------------------ ------ ------------- ---------- -------------
Assets
------------------------------ ------ ------------- ---------- -------------
Non -current assets
------------------------------ ------ ------------- ---------- -------------
Property, plant and
equipment 1 2 15
------------------------------ ------ ------------- ---------- -------------
Intangible assets 3 4,234 3,956 3,686
------------------------------ ------ ------------- ---------- -------------
4,235 3,958 3,701
------------------------------ ------ ------------- ---------- -------------
Current assets
------------------------------ ------ ------------- ---------- -------------
Trade and other receivables 1,462 1,728 1,993
------------------------------ ------ ------------- ---------- -------------
Overseas tax receivable 51 20 -
------------------------------ ------ ------------- ---------- -------------
Cash and cash equivalents 437 954 282
------------------------------ ------ ------------- ---------- -------------
1,950 2,702 2,275
------------------------------ ------ ------------- ---------- -------------
Liabilities
------------------------------ ------ ------------- ---------- -------------
Current Liabilities
------------------------------ ------ ------------- ---------- -------------
Income tax payable - - (35)
------------------------------ ------ ------------- ---------- -------------
Trade and other liabilities (2,917) (3,363) (2,796)
------------------------------ ------ ------------- ---------- -------------
Borrowings 4 (994) (966) (668)
------------------------------ ------ ------------- ---------- -------------
(3,912) (4,329) (3,499)
------------------------------ ------ ------------- ---------- -------------
Net current liabilities (1,962) (1,627) (1,224)
------------------------------ ------ ------------- ---------- -------------
Non - current liabilities
------------------------------ ------ ------------- ---------- -------------
Borrowings 4 (2,750) (2,750) (2,750)
------------------------------ ------ ------------- ---------- -------------
Net liabilities (476) (419) (273)
------------------------------ ------ ------------- ---------- -------------
Shareholders' equity
------------------------------ ------ ------------- ---------- -------------
Ordinary shares 88 88 88
------------------------------ ------ ------------- ---------- -------------
Deferred shares 50 50 50
------------------------------ ------ ------------- ---------- -------------
Share premium 9,296 9,296 9,296
------------------------------ ------ ------------- ---------- -------------
Share based payments
reserve 2,343 2,318 2,287
------------------------------ ------ ------------- ---------- -------------
Foreign currency translation (10) (8) -
------------------------------ ------ ------------- ---------- -------------
Accumulated losses (12,243) (12,163) (11,994)
------------------------------ ------ ------------- ---------- -------------
Total shareholders'
equity (476) (419) (273)
------------------------------ ------ ------------- ---------- -------------
Ludorum plc
Unaudited statement of changes in shareholders' equity
Share Share Accumulated Share-based Foreign Total
Capital Premium losses payments currency deficit
reserve translation
----------------------- --------- --------- ------------ ------------ ------------- ---------
30 September 2013 Sept Sept Sept 13 Sept Sept Sept 13
13 13 GBP000 13 13 GBP000
GBP000 GBP000 GBP000 GBP000
----------------------- --------- --------- ------------ ------------ ------------- ---------
At 31 March 2013 138 9,296 (12,163) 2,318 (8) (419)
----------------------- --------- --------- ------------ ------------ ------------- ---------
Loss for the period - - (80) - - (80)
----------------------- --------- --------- ------------ ------------ ------------- ---------
Other comprehensive
income:
Foreign exchange
differences - - - - (2) (2)
----------------------- --------- --------- ------------ ------------ ------------- ---------
Total comprehensive
income
for the period to
30 Sept 2013 - - (80) - (2) (82)
----------------------- --------- --------- ------------ ------------ ------------- ---------
Transactions with
owners
----------------------- --------- --------- ------------ ------------ ------------- ---------
Charge relating to
incentive option
plan - - - 25 - 25
----------------------- --------- --------- ------------ ------------ ------------- ---------
At 30 September 2013 138 9,296 (12,243) 2,343 (10) (476)
----------------------- --------- --------- ------------ ------------ ------------- ---------
Share Share Accumulated Share-based Foreign Total
Capital Premium losses payments currency deficit
reserve translation
----------------------- --------- --------- ------------ ------------ ------------- ---------
30 September 2012 Sept Sept Sept 12 Sept Sept Sept 12
12 12 GBP000 12 12 GBP000
GBP000 GBP000 GBP000 GBP000
----------------------- --------- --------- ------------ ------------ ------------- ---------
At 31 March 2012 138 9,296 (12,274) 2,238 - (602)
----------------------- --------- --------- ------------ ------------ ------------- ---------
Profit for the period - - 280 - - 280
----------------------- --------- --------- ------------ ------------ ------------- ---------
Other comprehensive - - - - - -
income:
Foreign exchange
differences
----------------------- --------- --------- ------------ ------------ ------------- ---------
Total comprehensive
income
for the period to
30 Sept 2012 - - 280 - - 280
----------------------- --------- --------- ------------ ------------ ------------- ---------
Transactions with
owners
----------------------- --------- --------- ------------ ------------ ------------- ---------
Charge relating to
incentive option
plan - - - 49 - 49
----------------------- --------- --------- ------------ ------------ ------------- ---------
At 30 September 2012 138 9,296 (11,994) 2,287 - (273)
----------------------- --------- --------- ------------ ------------ ------------- ---------
Ludorum plc
Unaudited consolidated cash flow statement for the six months
ended 30 September 2013
Six months Six months
ended ended
30 September 30 September
2013 2012
GBP000 GBP000
------------------------------------------- -------------- --------------
Cash flows from operating activities
------------------------------------------- -------------- --------------
Cash used in operations (75) (203)
------------------------------------------- -------------- --------------
Interest received - -
------------------------------------------- -------------- --------------
Interest paid (67) (57)
------------------------------------------- -------------- --------------
Taxation paid (18) (57)
------------------------------------------- -------------- --------------
Net cash used in operating activities (160) (317)
------------------------------------------- -------------- --------------
Cash flows from investing activities
------------------------------------------- -------------- --------------
Investment in intangible assets (385) (615)
------------------------------------------- -------------- --------------
Net cash used in investing activities (385) (615)
------------------------------------------- -------------- --------------
Cash flows from financing activities - -
------------------------------------------- -------------- --------------
Net decrease in cash and cash equivalents (545) (932)
------------------------------------------- -------------- --------------
Cash, cash equivalents and bank
overdraft at 31 March (12) 546
------------------------------------------- -------------- --------------
Cash, cash equivalents and bank
overdraft at 30 September (557) (386)
------------------------------------------- -------------- --------------
Ludorum plc
Notes to the consolidated interim financial statements for the
six months ended 30 September 2013
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 23 December 2013.
Basis of preparation
The condensed consolidated interim financial information should
be read in conjunction with the annual financial statements for the
15 month period ended 31 March 2013, 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 15 month period
ended 31 March 2013 were approved by the Board for issue on 13 June
2013 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 15 month period ended 31 March
2013, 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 September 30 September
2013 2012
GBP000 GBP000
------------------- -------------- --------------
Television 428 276
------------------- -------------- --------------
Consumer Products 2,091 3,068
------------------- -------------- --------------
Other 7 19
------------------- -------------- --------------
2,526 3,363
------------------- -------------- --------------
Geographical analysis of revenue by location of customer
Six months Six months
ended ended
30 September 30 September
2013 2012
GBP000 GBP000
-------------------------------- -------------- --------------
United Kingdom, Europe, Middle
East & Africa 1,144 1,542
-------------------------------- -------------- --------------
Asia & Australasia 413 656
-------------------------------- -------------- --------------
Americas 969 1,165
-------------------------------- -------------- --------------
2,526 3,363
-------------------------------- -------------- --------------
All material assets are located in the UK.
3. Intangible assets
Capitalised development
costs
------------------------------------- ------------------------
GBP000
------------------------------------- ------------------------
30 September 2013
------------------------------------- ------------------------
Cost
------------------------------------- ------------------------
At 1 April 2013 5,880
------------------------------------- ------------------------
Additions 622
------------------------------------- ------------------------
At 30 September 2013 6,502
------------------------------------- ------------------------
Accumulated amortisation
------------------------------------- ------------------------
At 1 April 2013 1,924
------------------------------------- ------------------------
Charge for the period 344
------------------------------------- ------------------------
At 30 September 2013 2,268
------------------------------------- ------------------------
Net book value at 30 September 2013 4,234
------------------------------------- ------------------------
Capitalised development
costs
------------------------------------- ------------------------
GBP000
------------------------------------- ------------------------
30 September 2012
------------------------------------- ------------------------
Cost
------------------------------------- ------------------------
At 1 April 2012 4,877
------------------------------------- ------------------------
Additions 389
------------------------------------- ------------------------
At 30 September 2012 5,266
------------------------------------- ------------------------
Accumulated amortisation
------------------------------------- ------------------------
At 1 April 2012 1,236
------------------------------------- ------------------------
Charge for the period 344
------------------------------------- ------------------------
At 30 September 2012 1,580
------------------------------------- ------------------------
Net book value at 30 September 2012 3,686
------------------------------------- ------------------------
4. Borrowings
The following borrowings are included in trade and other
liabilities:
30 September 31 March 30 September
2013 2013 2012
------------------------------ ------------- --------- -------------
GBP000 GBP000 GBP000
------------------------------ ------------- --------- -------------
Bank overdraft 994 966 668
------------------------------ ------------- --------- -------------
Loans 2,750 2,750 2,750
------------------------------ ------------- --------- -------------
3,744 3,716 3,418
------------------------------ ------------- --------- -------------
Undrawn borrowing facilities
------------------------------ ------------- --------- -------------
Bank overdraft 34 293 82
------------------------------ ------------- --------- -------------
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).
Ludorum has the legal right to set off balances within the Group.
Coutts & Co has temporarily increased the Company's overdraft
facility from GBP750,000 to GBP1m until 28 February 2014 and then
GBP900,000 until 31 March 2014, at which date it will revert to
GBP750,000..
The loan notes were issued in March 2012 and 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 September 2013 is
GBP135,000 in respect of unpaid remuneration (and the associated
employer's National Insurance payable) owed to directors of the
Company (30 September 2012: GBP152,000, 31 March 2013: GBP135,000).
Also included in trade and other liabilities at 30 September 2013
are accrued pension costs owed to the directors of GBP97,000 (30
September 2012: GBP74,000, 31 March 2013: GBP85,000).
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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