REG - Aeorema Comms Plc - Interim Report

Aeorema CommunicationsAnnouncement

22/03/2021 07:05

RNS Number : 9379S
  
Aeorema Communications Plc
  
22 March 2021
  
 

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Regulation 11 of the Market Abuse Regulations (Amendment) (EU Exit) Regulations 2019/310 ("MAR").  With the publication of this announcement via a Regulatory Information Service, this inside information is now considered to be in the public domain.
 
Aeorema Communications plc / Index: AIM / Epic: AEO / Sector: Media
22 March 2021
Aeorema Communications plc ('Aeorema' or 'the Company' or 'the Group')
Interim Report
 
Aeorema Communications plc, the AIM-traded live events agency, announces its unaudited results for the six months ended 31 December 2020. 
 
Overview
·    Revenues of £1,677,311 (2019: £2,913,290)
·    Loss after taxation of £247,576 (2019: loss of £57,021)
·    Robust cash position of £1,342,548 (31 December 2019: £1,393,243)
·    Returned to profitability in the final three-months of the period
 
Chairman's Statement 
Our shareholders will be familiar with the proverb "necessity is the mother of invention" and this phrase became especially true for your Company as the hospitality and events industry experienced an immediate and full-blown shut down in the unprecedented times of the Covid-19 pandemic. 
 
I am proud of our achievements during the period under review, having quickly re-invented ourselves at pace into an expert in virtual and hybrid conferencing following the collapse of the live events business as a result of Covid-19 last year. Equally, I am optimistic for the future as I believe we are well positioned to grow rapidly when live events return.
 
Faced with the extraordinary challenge of restructuring our business to service a new model focused on virtual events, our team adeptly stepped up to the plate. We developed new services, built our own virtual events platform, KIT, grew existing accounts, onboarded new clients, and impressively returned the Company to profitability in the final months of the period - an outstanding achievement following a period which necessitated substantial restructuring costs and saw a gradual take up of our new offerings. In addition to our traditional largely professional services client base, we are proud to have onboarded a technology giant, working across its four divisions, as well as working with a further five technology clients, all of whom trust our consultancy and technical expertise. These accounts continue to grow during this unprecedented period, and we anticipate further engagements going forward. 
 
While we had expected revenues from live events of circa £3-5 million for July to December 2020, we replaced this lost income with £1,677,311 in revenue from virtual events. We also contained the loss after tax to £247,576 (2019: loss of £57,021) and ended the calendar year with £1,342,548 in cash (2019: £1,393,243) despite restructuring costs. The trend is positive. With several new blue-chip clients and a strong pipeline, we are confident that the next six months will be profitable. The Company's cash position remains strong and as at the date of this announcement is circa £1.1 million. 
 
We announced the opening of an office in New York in September 2020. This was a strategic decision signifying a dedicated approach to supporting the growing needs and requests of our clients in the US, and internationally, as we saw an increase in potential business in the region. I am pleased to report this has been a beneficial investment for the Company and we are expecting to make a profit from this division in its first year. Our presence in the US has enabled us to grow our existing clients as well as win new US based clients. 
 
Whilst Eventful, acquired in March 2020, was naturally severely impacted by Covid-19 related travel bans and venue closures, the team has maintained its relationships with existing clients and been introduced to many new clients working with Cheerful Twentyfirst. During this quiet period, the team has been developing its strategy for 2021/22 and is excited about both returning to sourcing venues for live events and building an exceptional incentives programme for corporates. Holly Mills has joined Eventful as Head of Incentives (formerly Head of Incentives at Penguins Events) and is developing the new Incentives offering for a market with pent up demand and sizeable budgets.
 
Looking ahead, we believe live events will return; a number of clients have commented that there is no substitute for personal contact. However, regardless of when this happens, we have proven that we can operate as a profitable business in the virtual and hybrid space too and are excited at the prospect of new opportunities for the Group.  Furthermore, we are growing our fee based strategic communications solutions as part of our new consultancy approach, supported by production excellence and networking solutions that continue to challenge the norm.
 
I would like to thank our team and our shareholders for their ongoing support and look forward to the next six months with growing optimism. 
 
 
M Hale
Chairman 
19 March 2021
 
 
 
 
 
 
AEOREMA COMMUNICATIONS PLC
CONDENSED CONSOLIDATED INCOME STATEMENT
For the period ended 31 December 2020
 
 
 




 
 
 


 


Unaudited
6 Months to 31 December 2020


Unaudited
6 Months to 31 December 2019


Audited
Year to 
30 June 
2020




 


 


 


 


 




 


Notes


£


£


£




Continuing Operations


 


 


 


 




 


 


 


 


 




Revenue


 


1,677,311


2,913,290


5,475,425




Cost of sales


 


(829,741)


(2,044,591)


(3,629,770)




 


 


 


 


 




Gross profit


 


847,570


868,699


1,845,655




 


 


 


 


 




Other income


 


49,616


-


82,601




 


 


 


 


 




Administrative expenses 


 


(1,175,117)


(958,677)


(2,103,299)




 


 


 


 


 




Operating (loss) / profit pre-exceptional items


 


(277,931)


(89,978)


(175,043)




 


 


 


 


 




Exceptional items


 


-


-


(23,184)




 


 


 


 


 




Operating (loss) / profit post exceptional items


 


(277,931)


(89,978)


(198,227)




 


 


 


 


 




Finance income


 


539


328


556




 


 


 


 


 




Finance costs


 


(10,284)


-


(20,253)




 


 


 


 


 




(Loss) / profit before taxation


 


(287,676)


(89,650)


(217,924)




 


 


 


 


 




Taxation


4


40,100


32,629


20,497




 


 


 


 


 




(Loss) / profit for the period from continuing operations


 


 
(247,576)


 
(57,021)


 
(197,427)




 


 


 


 


 




Other comprehensive income


 


 


 


 




Items that may be reclassified to profit or loss


 


 


 


 




 


 


 


 


 




Exchange differences on translation of foreign entities


 


(7,479)


-


-




 


 


 


 


 




Other comprehensive income for the period


 


(7,479)


-


-




 


 


 


 


 




 


 


 


 


 




Total comprehensive income for the period


 


(255,055)


(57,021)


(197,427)




 


 


 


 


 




Basic and diluted earnings per share from continuing operations


 


 


 


 




 


 


 


 


 




Basic (pence)


5


(2.67997)p


(0.63003)p


(2.16920)p




Diluted (pence)


5


N/A


N/A


N/A




 
 
 
AEOREMA COMMUNICATIONS PLC
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
For the period ended 31 December 2020
 
 
 




 


 


Unaudited
6 Months to 31 December 2020


Unaudited
6 Months to 31 December 2019


Audited
Year to 
30 June 
2020




 


 


 


 


 




 


 


£


£


£




 


 


 


 


 




Non-current assets


 


 


 


 




Intangible assets


 


572,682


365,154


573,931




Property, plant and equipment


 


76,832


98,070


85,952




Right-to-use assets


 


333,983


425,070


379,530




Deferred taxation


 


47,710


25,100


7,611




 


 


1,031,207


913,394


1,047,024




 


 


 


 


 




Current assets


 


 


 


 




Trade and other receivables


 


1,007,548


1,480,984


597,497




Cash and cash equivalents


 


1,342,548


1,393,243


1,721,217




 


 


2,350,096


2,874,227


2,318,714




 


 


 


 


 




 


 


 


 


 




Total assets


 


3,381,303


3,787,621


3,365,738




 


 


 


 


 




Current liabilities


 


 


 


 




Trade and other payables


 


1,298,948


1,472,303


1,186,670




Lease liabilities


 


87,219


82,973


85,070




Bank loans


 


13,889


-


-




Current tax payable


 


3,711


74,616


68,490




 


 


1,403,767


1,629,892


1,340,230




 


 


 


 


 




Non-current liabilities


 


 


 


 




Lease liabilities


 


256,538


343,756


300,689




Bank loans


 


236,112


-


-




Provisions


 


25,020


25,020


25,020




 


 


517,670


368,776


325,709




 


 


 


 


 




 


 


 


 


 




Total liabilities


 


1,921,437


1,998,668


1,665,939




 


 


 


 


 




Net assets


 


1,459,866


1,788,953


1,699,799




 


 


 


 


 




 


 


 


 


 




Equity attributable to equity holder:


 


 


 


 




Share capital


 


1,154,750


1,131,313


1,154,750




Share premium


 


9,876


7,063


9,876




Merger reserve


 


16,650


16,650


16,650




Other reserve


 


96,480


56,358


81,358




Capital contribution reserve


 


257,812


257,812


257,812




Retained earnings


 


(75,702)


319,757


179,353




 


 


 


 


 




Total equity


 


1,459,866


1,788,953


1,699,799





 

AEOREMA COMMUNICATIONS PLC
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the period ended 31 December 2020
 
 




 


Share capital


Share
premium


Merger reserve


Other reserve


Capital contribution reserve


Retained earnings


Total equity




 


£


£


£


£


£


£


£




 


 


 


 


 


 


 


 




At 1 July 2019


1,131,313


7,063


16,650


34,261


257,812


467,283


1,914,382




Payment of dividends


-


-


-


-


-


(90,505)


(90,505)




Comprehensive income for the period


-


-


-


-


-


(57,021)


(57,021)




Share-based payments


-


-


-


22,097


-


-


22,097




 
At 31 December 2019


 
1,131,313


 
7,063


 
16,650


 
56,358


 
257,812


 
319,757


 
1,788,953




 


 


 


 


 


 


 


 




At 1 January 2020


1,131,313


7,063


16,650


56,358


257,812


319,757


1,788,953




Comprehensive income for the period


-


-


-


-


-


(140,404)


(140,404)




Share-based payments


-


-


-


25,000


-


-


25,000




Share issue


23,437


2,813


-


-


-


-


26,250




 
At 30 June 2020


 
1,154,750


 
9,876


 
16,650


 
81,358


 
257,812


 
179,353


 
1,699,799




 
 


 


 


 


 


 


 


 




At 1 July 2020


1,154,750


9,876


16,650


81,358


257,812


179,353


1,699,799




Comprehensive income for the period


-


-


-


-


-


(255,055)


(255,055)




Share-based payments


-


-


-


15,122


-


-


15,122




 
At 31 December 2020


 
1,154,750


 
9,876


 
16,650


 
96,480


 
257,812


 
(75,702)


 
1,459,866




 
 
AEOREMA COMMUNICATIONS PLC
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
For the period ended 31 December 2020
 
 




 


 


Unaudited
6 Months to 31 December 2020


Unaudited
6 Months to 31 December 2019


Audited
Year to 
30 June 
2020




 


 


 


 


 




 


 


£


£


£




Cash flow from operating activities


 


 


 


 




(Loss) / profit before taxation


 


(287,676)


(89,650)


(217,924)




Adjustments for:


 


 


 


 




Depreciation of property, plant and equipment


 


18,209


14,064


31,871




Depreciation of right-of-use assets


 


45,546


43,848


89,392




Amortisation of intangible fixed assets


 


1,250


-


417




Loss on disposal of fixed assets


 


769


1,424


1,648




Share-based payment


 


15,122


22,097


47,097




Interest on lease liabilities


 


8,996


10,222


20,253




Finance income


 


(539)


(327)


(556)




Exchange rate differences on translation


 


(7,479)


-


-




Operating cash flow before movement in working capital


 


(205,802)


1,678


(27,802)




Increase/(decrease) in trade and other payables


 


112,278


(755,036)


(1,075,254)




(Increase)/decrease in trade and other receivables


 


(410,049)


131,361


1,014,847




Cash (used in) / generated from operating activities


 


(503,573)


(621,997)


(88,209)




 


 


 


 


 




Taxation paid


 


(64,779)


-


(10,797)




 


 


 


 


 




Cash flow from investing activities


 


 


 


 




Payment for Acquisition of Subsidiary, net of cash acquired


 


-


-


(128,331)




Finance income


 


539


327


556




Purchase of intangible assets


 


-


-


(10,000)




Purchase of property, plant and equipment


 


(9,856)


(55,710)


(61,400)




Disposal of property, plant and equipment


 


-


224


-




Repayment of leasing liabilities


 


(51,000)


(50,257)


(101,258)




Net cash used in investing activities


 


(60,317)


(105,416)


(300,433)




 


 


 


 


 




Cash flow from financing activities


 


 


 


 




Dividends paid
Bank loans


 


-
250,000


(90,505)
-


(90,505)
-




Net cash used in financing activities


 


250,000


(90,505)


(90,505)




 


 


 


 


 




Net increase / (decrease) in cash and cash equivalents


 


(378,669)


(817,918)


(489,944)




 


 


 


 


 




Cash and cash equivalents at beginning of period


 


1,721,217


2,211,161


2,211,161




 


 


 


 


 




Cash and cash equivalents at end of period


 


1,342,548


1,393,243


1,721,217




 


 


 


 


 




 
 
AEOREMA COMMUNICATIONS PLC
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
For the period ended 31 December 2020
 
1.    General information
 
Aeorema Communications plc is a public limited company incorporated within the United Kingdom. The company is domiciled in the United Kingdom and its principal place of business is 23-31 Great Titchfield Street, London, W1W 7PA. The Company's ordinary shares are traded on the AIM market of the London Stock Exchange.
 
These condensed consolidated interim financial statements for the period ending 31 December 2020 (including comparatives for the periods ended 31 December 2019 and 30 June 2020) were approved by the board of directors on 20 March 2021.
 
The financial information set out in this interim report does not constitute statutory accounts for the purposes of section 434 of the Companies Act (2006). The Group's statutory financial statements for the year ended 30 June 2020, prepared under International Financial Reporting Standards (IFRS), have been filed with the Registrar of Companies. The auditor's report for those financial statements was unqualified and did not contain a statement under section 498 (2) or section 498 (3) of the Companies Act (2006).
 
The interim financial statements have been prepared using the accounting policies set out in the Group's 2020 statutory accounts and have not been audited.
 
Copies of the annual statutory financial statements and the interim report can be found on our website at www.aeorema.com or can be requested from the Company Secretary at the Company's registered office: 64 New Cavendish Street, London, W1G 8TB.
 
2.    Basis of preparation
 
These condensed consolidated interim financial statements for the period ended 31 December 2020 have been prepared in accordance with IAS 34, 'Interim Financial Reporting' as adopted by the European Union. The interim condensed consolidated financial statements should be read in conjunction with the annual financial statements for the year ended 30 June 2020, which have been prepared in accordance with IFRS as adopted by the European Union.
 
3.    Revenue and segmental results
 
The Company uses several factors in identifying and analysing reportable segments, including the basis of organisation such as differences in products and geographical areas. The Board of Directors, being the chief operating decision makers, has determined that for the period ended 31 December 2020 there is only one reportable operating segment.
 
4.    Income tax charge
 
Income period tax is accrued based on the estimated average annual effective income tax rate of 19 per cent. (2019: 19 per cent).
 
 
5.    Earnings per share
 
Basic earnings per share is calculated by dividing the profit attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the year.
 
Diluted earnings per share are calculated by dividing the profit attributable to ordinary owners of the parent by the weighted average number of ordinary shares outstanding during the year plus the weighted average number of ordinary shares that would have been issued on the conversion of all dilutive potential ordinary shares into ordinary shares.
 
The following reflects the income and share data used and dilutive earnings per share computations:
 




 


Unaudited 6 Months to 31 December 2020


Unaudited 6 Months to 31 December 2019


Audited Year to 30 June 2020




 


 


 


 




(Loss) / profit for the year attributable to owners of the Company


(247,576)


(57,021)


(197,427)




 


 


 


 




Number of shares


 


 


 




 


 


 


 




Basic weighted average number of shares


9,238,000


9,050,500


9,101,356




 


 


 


 




Effect of dilutive share options


1,020,000


1,020,000


1,020,000




 


 


 


 




Diluted weighted average number of shares


10,258,000


10,070,500


10,121,356




 


 


 


 




 
6.    Dividends
 
During the interim period no dividend (2019: 1 pence per share) was declared to holders of the Company's ordinary shares in respect of the full year ended 30 June 2020.
 
 
 
 
 
7.    Related party transactions
 
The Group has a related party relationship with its subsidiaries and its directors. Transactions between Group companies, which are related parties, have been eliminated on consolidation and are therefore not included in these consolidated interim financial statements.
 




 


Unaudited 6 months to 31 December 2020


Unaudited 6 months to 31 December 2019




 


£


£




Subsidiaries


 


 




Amounts owed by/(to) subsidiaries


504,694


1,027,839




Amounts owed by/(to) subsidiaries


504,694


1,027,839




 
 
 
Harris & Trotter LLP is a firm in which S Haffner is a member. The following was charged to the Group in respect of professional services.
 




 


Unaudited 6 Months to 31 December 2020


Unaudited 6 Months to 31 December 2019




Harris & Trotter LLP


£


£




Aeorema Communications plc


7,500


7,500




Aeorema Limited


10,450


11,750




 


17,950


19,250




 
Fees charged to Aeorema Communications plc include £7,500 (2019: £7,500) for the services of S Haffner as a non-executive director of that company.
 
The compensation of key management (including directors) of the Group is as follows:
 




 


Unaudited 6 Months to 31 December 2020


Unaudited 6 Months to 31 December 2019




 


£


£




Short-term employee benefits 


140,500


110,667




Post-employment benefits


2,992


5,024




 


143,492


115,691




 
During the period A Harvey received an interest-free loan of £10,000. At 31 December 2020, £10,000 (2019: £10,000) was outstanding. 
 
During the period S Quah received an interest-free loan of £10,000. At 31 December 2020, £10,000 (2019: £Nil) was outstanding. 
 
 
ENDS
 
For further information visit www.aeorema.com or contact:
 




Mike Hale
 
 


Aeorema Communications plc


+44 (0)20 7291 0444




John Depasquale /
Liz Kirchner (Corporate Finance)
Kelly Gardiner (Sales and Corporate Broking)
 


Allenby Capital Limited (Nominated Adviser and Broker)


+44 (0)20 3328 5656




Catherine Leftley/ Selina Lovell


St Brides Partners Ltd   
(Financial PR)


info@stbridespartners.co.uk




 
 
 

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