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RNS Number : 0995X Catalyst Media Group PLC 30 December 2021
30 December 2021
Catalyst Media Group Plc
("CMG", the "Company" or the "Group")
Final Results for the Year Ended 30 June 2021
and Notice of Annual General Meeting
The Board of CMG (AIM: CMX) is pleased to announce the Company's final results
for its financial year ended 30 June 2021.
CMG is a 20.54% shareholder in Sports Information Services (Holdings) Limited
("SIS") and the results for the year to 30 June 2021 incorporate its share in
the profits/(losses) of SIS for its financial year ended 31 March 2021, as an
equity accounted associate.
Highlights:
· CMG loss after taxation of £1.6 million with no impairment charge in
the carrying value of the group's interest in SIS (2020: loss of £1.1 million
following an impairment charge of £1.2 million in the carrying value of the
group's interest in SIS)
· Loss per share of 7.51p (2020: loss per share of 5.27p)
· Net asset value per share of 52.3p (2020: 60.7p)
· For its financial year to 31 March 2021, SIS achieved:
- Turnover of £130.1 million (2020: £212.6 million)
- Operating loss prior to litigation fees of £8.3 million (2020:
£3.6 million)
- Loss after taxation prior to litigation fees of £6.7 million (2020:
profit after taxation prior to litigation fees of £3.7 million)
· SIS did not declare or pay any dividends to CMG during the reporting
period (2020: £5.0 million dividend declared of which £1.03 million was
received by CMG)
· CMG has not declared nor paid any dividends during the reporting
period (2020: £1.05 million dividend (5p per share) declared in October
2019 and paid in November 2019)
SIS Current Trading and Outlook
· Following the relaxation of COVID-19 restrictions in May 2021, SIS's
UK and Irish retail business has returned to normal operations whilst its
Digital business has continued to operate at levels higher than pre-COVID-19
with significant growth in its customer base and continued scaling up of its
Competive Gaming (e-sports) and Numbers draws products. Accordingly, SIS's
profitability for its current financial year to 31 March 2022 is expected to
see a significant rebound and, although still impacted by the COVID-19
outbreak and uncertain nature of the new variants, the Board of CMG has been
informed that it currently expects to make a profit for its financial year as
a whole
· In June 2021, SIS extended its rights agreement with Racecourse Media
Group for UK Retail Horseracing rights for a further 3 years through to March
2026 and completed an initial investment in, and long term partnership
arrangement with, Racelab Pty Limited, a racing data science company in
Australia, to enhance its product range
· As at 30 November 2021, SIS had a total cash balance of approximately
£52m and its working capital position has returned to normal levels. The
Board of CMG is hopeful that SIS will be able to return to paying dividends in
its next financial year
Availability of Annual Report & Financial Statements and Notice of Annual
General Meeting
A pdf copy of the Company's full Annual Report and Financial Statements for
its financial year ended 30 June 2021, together with the formal notice of
Annual General Meeting ("AGM") and form of proxy, will shortly be made
available to download from the Company's website at: www.cmg-plc.com.
The AGM is to be held at 6 Stratton Street, London W1J 8LD at 11.00 a.m. on
Thursday, 27 January 2022. In light of the current status of the evolving
COVID-19 situation and any UK government restrictions on public gatherings
that may be introduced and in force at the date of the AGM, the Directors
strongly encourage all Shareholders to vote electronically or lodge a form of
proxy prior to the meeting and not attend the meeting in person.
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 Regulation
(EU) No. 596/2014 as it forms part of United Kingdom domestic law by virtue of
the European Union (Withdrawal) Act 2018, as amended.
Key Extracts from the Company's audited Annual Report and Financial Statements
are set out below:
Chairman's Statement
I am pleased to present the results for Catalyst Media Group plc ("CMG" or the
"Company") for the year ended 30 June 2021, which incorporates our share of
profits/losses for Sports Information Services (Holdings) Ltd ("SIS") in which
CMG has a 20.54% interest.
The main asset of CMG continues to be its 20.54% shareholding in SIS, as
detailed further below. CMG equity accounts for its share in the
profits/losses of SIS.
After taking account of CMG's share in the loss (2020: profits) of SIS for its
year ended 31 March 2021 of £1.47 million (2020: £0.13 million), CMG
recorded a loss before taxation of £1.6 million (2020: loss of £1.1
million), with no impairment charge recognised against the carrying value of
its interest in SIS (2020: charge of £1.2 million). Net assets at the year
end were £11 million (52.3p per share) (2020: £12.8 million (60.7p per
share)).
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, 49's and International Horseracing to almost the entire UK
and Irish retail market, including all the major UK bookmaking groups and the
majority of the independent operators market.
Additionally, SIS supplies content and services to its UK and Irish retail
customers to cover early morning and additional evening products and has
renewed several pre-existing arrangements.
In SIS's financial year to 31 March 2021, COVID-19 led to Licensed Betting
Offices ("LBOs") being closed or operating under significant restrictions
which resulted in no SIS Retail Services for a period of two months and
significant disruption to retail services and revenue for a further six
months.
SIS - International & Online
SIS has continued to expand both the content and customer base for its 24/7
racing channels covering horseracing, greyhound racing, virtual racing and
mixed channels, and has improved the user experience. SIS now has over 50
channels with customers designed to maximise betting opportunities for
international retail and online operators and has signed 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.
The financial year also saw the launch of new online products outside of
racing which included the launch of the SIS Competitive Gaming (e-sports)
service during the UK lockdown in May 2020, with commitment from customers for
multiple 24/7 service channels. Additionally, following the acquisition of the
49's business in June 2020, the numbers draws and virtuals products have been
launched online and have experienced rapid growth.
SIS Results
The Company announced in March 2021 that the forecast annual loss before tax
for SIS was between £9m and £10m, whereas the final result for its year
ended 31 March 2021 was a loss before tax of £8.6 million. The main driver
for the loss was the significant restrictions and disruptions to trading due
to the COVID-19 pandemic.
SIS's cash balance on 31 March 2021 was approximately £38.9 million, down on
the prior year due to the COVID-19-driven loss and the related unwind in
working capital. There has been no dividend declared nor paid by SIS since the
end of its financial year.
The results of SIS for its year ended 31 March 2021 were as follows:
31 March 2021 31 March 2020
Before individually significant items* Individually significant Total Before individually significant items* Individually significant Total
Items* Items*
£'000 £'000 £'000 £'000 £'000 £'000
Turnover 130,107 - 130,107 212,593 - 212,593
Operating expenses (140,267) (622) (140,889) (208,975) (3,577) (212,552)
Other operating income 1,863 - 1,863 - - -
Group operating profit / loss (8,297) (622) (8,919) 3,618 (3,577) 41
Other interest receivable and similar income 310 - 310 756 - 756
Interest payable and similar expenses (3) - (3) (1) - (1)
Profit / (loss) before taxation (7,990) (622) (8,612) 4,373 (3,577) 796
Tax on profit / (loss) 1,337 118 1,455 (695) 509 (186)
Profit / (loss) after taxation (6,653) (504) (7,157) 3,678 (3,068) 610
Other comprehensive income (917) - (917) 1,279 - 1,279
Total comprehensive income (7,570) (504) (8,074) 4,957 (3,068) 1,889
Notes: * - Individually significant items relate to litigation fees.
Share of net assets and liabilities of associate
31 March 2021 31 March 2020
Gross assets 100,419 97,150
Net liabilities (47,771) (36,428)
Net assets 52,648 60,722
India
An arbitration award was made in July 2020 in respect of the Indian project
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.
Litigation
As previously announced on 9 October 2020, in the case brought by The Racing
Partnership ("TRP") and others against SIS's subsidiary, Sports Information
Services Limited ("SISL"), and others, the Court of Appeal handed down
judgment in relation to the appeals against various elements of the High Court
judgment of Mr Justice Zacaroli in respect of liability issues. The Court of
Appeal:
1. Upheld SISL's appeal in relation to the finding of breach of confidence in
relation to certain race day data supplied to SISL by a co-defendant; and
2. Upheld TRP's appeal against the dismissal of its claims for unlawful means
conspiracy.
The Court of Appeal was concerned only with the appeals on the liability
findings and consequently made no ruling as to damages.
SIS has applied to the Supreme Court and has been granted an appeal hearing
which is currently expected to be held in the summer of 2022.
Current Trading and Outlook
Following the relaxation of COVID-19 restrictions in May 2021 the UK and Irish
retail business has returned to normal operations whilst the Digital business
has continued to operate at levels higher than pre-COVID-19 and has seen
significant growth in its customer base. Additionally, the business has
continued to scale its new products of Competitive Gaming (e-sports) and
Numbers draws.
SIS's profitability for the year to 31 March 2022 will see a significant
rebound and, although still impacted by the COVID-19 outbreak, SIS expects to
make a profit for the year as a whole, albeit the magnitude of such profit is
currently difficult to forecast given the uncertain nature of the new COVID-19
variants.
In June 2021, SIS extended its rights agreement with Racecourse Media Group
for UK Retail Horseracing rights for a further 3 years through to March 2026
and has already secured two extended contracts for major customers of this
content.
Also in June 2021, SIS completed an initial investment in, and long term
partnership arrangement with, Racelab Pty Limited, a racing data science
company in Australia, which added a range of market leading products across
the SIS portfolio of international horse and greyhound racing
SIS's cash balance had risen to circa £52m as of 30 November 2021 and its
working capital position has returned to normal levels.
As a result of the COVID-19 uncertainty, SIS has deferred any dividend this
year and will next consider a dividend in 2022.
The Directors consider that the most appropriate treatment for the Group's
investment in its associate, SIS, as at 30 June 2021 is to hold the investment
at the Group's share of SIS's net assets. For further details on this, please
refer to notes 1 and 2 in the full Annual Report and Financial Statements.
CMG's outlook and Annual General Meeting
CMG continues to be cash positive with very low overheads. As stated above, it
is hoped that SIS will be able to return to paying dividends in its next
financial year.
The next Annual General Meeting of CMG will take place on Thursday, 27 January
2022. Formal Notice of the meeting is set out at the end of the full Annual
Report and Financial Statements together with the form of proxy.
Michael Rosenberg, OBE
Chairman
30 December 2021
Strategic Report
The Directors present their strategic report for the year ended 30 June 2021.
Principal activities and review of the business
The principal activities of the business are outlined in the Chairman's
Statement. A review of the business is also included within the Chairman's
Statement.
Principal risks and uncertainties
Investment in SIS
The principal strategic investment of the Group is its 20.54% shareholding in
SIS. The Group is entitled to appoint one director to the board of SIS which
currently comprises eight directors, of which five are appointed by
shareholders, two are independent and one is the Chairman. Although it can
influence the board on strategic decisions, the Group is not in a position to
control the day-to-day business and affairs of SIS other than with the support
of other directors and a majority of the shareholders of SIS.
There are a number of risks and uncertainties associated with the business of
SIS which could potentially have an adverse impact on the value of the Group's
investment. At a technical level this includes the fact that the customers of
SIS rely upon real time data and uninterrupted content delivery. Loss of
content would result in reduced quality of services and potentially reduced
income. SIS has therefore adopted advanced disaster recovery solutions and has
built back up facilities which are located around the UK.
Financial risk
The Group is subject to financial risk through its exposure to financial
assets and liabilities. The Group's main financial risk is its exposure to its
investment in SIS.
Credit risk
The Group is not exposed to any credit risk.
Liquidity risk
There is a very low risk that the Group will encounter difficulty in meeting
its financial obligations as they fall due, on the basis that the Group
operates with minimal overheads and cash flow is well managed.
The Group's policy is to ensure that it will always have sufficient cash to
allow it to meet its liabilities when they become due. The principal
liabilities of the Group and Company arise in respect of administrative
expenditure and trade and other payables. Trade and other payables are all
payable within three months.
The Board receives cash flow projections on a regular basis as well as
information on cash balances.
Key Performance Indicators (KPIs)
The Company's key performance indicators used by the Board in monitoring the
general performance of the Group and its investments are:
Net asset value per share
The net asset value per share of the Group was 52 pence as at 30 June 2021
(2020: 61 pence). The net asset value per share has therefore decreased during
the year to 30 June 2021. The net asset value of the Group as at 30 June 2021
and 30 June 2020 is shown in the Group's consolidated statement of financial
position.
Administrative expenses
The Directors closely monitor the anticipated overheads for the Group and
ensure that these are kept to a minimum.
Earnings per share (EPS)
EPS shows the relative performance year-on-year of the Group's profitability
measured as an amount of profit or loss attributable to one ordinary share.
The calculation of earnings per share is based on the weighted average number
of ordinary shares in issue for the financial year concerned and the
profit/(loss) after taxation attributable to ordinary shareholders. EPS in
respect of operations for the year and the prior financial year is shown in
the Group consolidated statement of comprehensive income.
Key Performance Indicators of Associate
The Directors additionally monitor the performance of SIS in order to evaluate
the general performance of the Group.
s172 Statement
CMG's Directors are mindful of their responsibilities under section 172 of the
Companies Act 2006 to promote the success of the business through operating in
accordance with good corporate practice and with considered engagement with
the Group's stakeholders. Several of the Group's major shareholders are also
directors of the Group and are therefore actively involved in all key
decision-making. Please see the Corporate Governance Statement in the full
Annual Report and Financial Statements for further details of engagement with
stakeholders.
The board of directors regularly review and identify other principal
stakeholders of the business, and decisions in respect of the Group's
activities are made only after reviewing, and discussing, the potential impact
on such stakeholders. Furthermore, in terms of engagement with the Group's
suppliers, the directors continue to actively monitor ethical standards and
environmental issues to ensure that the wider business is compliant with
global standards.
Energy and carbon report
For the financial year ended 30 June 2021, CMG is classified as a low energy
user as its total energy usage for the year to 30 June 2021 was below
40,000kWh. The Company is therefore exempt from providing an energy and carbon
report under section 20D(7a) of The Companies (Directors' Report) and Limited
Liability Partnerships (Energy and Carbon Report) Regulations 2018.
Michael Rosenberg, OBE
Chairman
30 December 2021
Consolidated statement of comprehensive income for the year ended 30 June 2021
Year Year
Ended Ended
30 June 30 June
2021 2020
£ £
Revenue 25,000 25,000
Administrative expenses (130,029) (123,600)
Operating loss (105,029) (98,600)
Financial income 23 712
Financial costs - -
Net financial income 23 712
Share of (loss)/profit of equity-accounted associate, net of tax (1,470,048) 125,294
Impairment of equity-accounted associate - (1,160,843)
Loss before taxation (1,575,054) (1,133,437)
Taxation (4,934) 25,583
Loss for the year (1,579,988) (1,107,854)
Share of other comprehensive (loss)/profit of associate (188,352) 262,707
Total comprehensive loss for the year (1,768,340) (845,147)
Attributable to equity holders of the Company (1,768,340) (845,147)
Loss per share:
Basic (7.51p) (5.27p)
Diluted (7.51p) (5.27p)
The above Consolidated Statement of Comprehensive Income should be read in
conjunction with the accompanying notes in the Company's full Annual Report
and Financial Statements.
Consolidated statement of financial position as at 30 June 2021
30 June 30 June
2021 2020
£ £
Assets
Non-current assets
Investment in associate 10,816,580 12,474,980
10,816,580 12,474,980
Current assets
Trade and other receivables 57,312 62,741
Cash and cash equivalents 167,830 270,654
225,142 333,395
Total assets 11,041,722 12,808,375
Equity and liabilities
Capital and reserves attributable to equity holders of the parent
Share capital 2,103,202 2,103,202
Capital redemption reserve 711,117 711,117
Merger reserve 2,402,674 2,402,674
Retained profits 5,785,560 7,553,900
Total equity 11,002,553 12,770,893
Current liabilities
Trade and other payables 39,169 37,482
Total equity and liabilities 11,041,722 12,808,375
The above Consolidated Statement of Financial Position should be read in
conjunction with the accompanying notes in the Company's full Annual Report
and Financial Statements.
Consolidated statement of changes in equity for the year ended 30 June 2021
Attributable to equity holders of the Group
30 June 2021 Share Share Capital Merger Retained Total
Capital Premium Redemption Reserve Reserve Profits Shareholders
Equity
£ £ £ £ £ £
At 1 July 2020 2,103,202 - 711,117 2,402,674 7,553,900 12,770,893
Loss for the year - - - - (1,579,988) (1,579,988)
Other comprehensive income:
Share of other comprehensive loss of associate - - - - (188,352) (188,352)
Total comprehensive loss for the period - - - - (1,768,340) (1,768,340)
At 30 June 2021 2,103,202 - 711,117 2,402,674 5,785,560 11,002,553
The following describes the nature and purpose of each reserve within owners'
equity:
Share capital Amount subscribed for shares at nominal value.
Share premium Amount subscribed for share capital in excess of nominal value.
Capital redemption reserve Amounts arising from the purchase by the group of its own shares.
Merger reserve Amounts arising from the merger of subsidiary investments.
Retained profits Cumulative profit of the Group attributable to equity shareholders.
Attributable to equity holders of the Group
30 June 2020 Share Share Capital Merger Retained Total
Capital Premium Redemption Reserve Reserve Profits Shareholders
Equity
£ £ £ £ £ £
At 1 July 2019 2,103,202 - 711,117 2,402,674 9,450,670 14,667,663
Loss for the year - - - - (1,107,854) (1,107,854)
Other comprehensive income
Share of other comprehensive profit of associate - - - - 262,707 262,707
Total comprehensive profit for the period - - (845,147) (845,147)
Dividends paid (1,051,623) (1,051,623)
At 30 June 2020 2,103,202 - 711,117 2,402,674 7,553,900 12,770,893
Consolidated statement of cash flows for the year ended 30 June 2021
Year ended Year ended
30 June 30 June
2021 2020
£ £
Cash flow from operating activities
Loss before taxation (1,575,054) (1,133,437)
Adjustments for:
Share of loss / (profit) from associate 1,470,048 (125,294)
Impairment of investment in associate - 1,160,843
Finance income (23) (712)
Corporation taxes recovered 29,941 -
Net cash flow used in operating activities before changes in working capital (75,088) (98,600)
(Decrease) / Increase in trade and other receivables (29,446) 1,849
Increase in trade and other payables 1,687 7,820
Net cash flow used in operating activities (102,847) (88,931)
Investing activities
Dividend received - 1,026,884
Interest received 23 712
Net cash flow from investing activities 23 1,027,596
Financing activities
Dividends paid - (1,051,623)
Net cash flow used in financing activities - (1,051,623)
Net decrease in cash and cash equivalents in the year (102,824) (112,958)
Cash and cash equivalents at the beginning of the year 270,654 383,612
Cash and cash equivalents at the end of the year 167,830 270,654
The above Consolidated Statement of Cash Flows should be read in conjunction
with the accompanying notes in the Company's full Annual Report and Financial
Statements.
Notes to the consolidated financial information
1. Basis of preparation and significant accounting policies
The consolidated financial information set out above does not constitute the
Group's financial statements for the years ended 30 June 2021 or 30 June 2020
but is derived from those financial statements. Statutory financial statements
for 2020 have been delivered to the Registrar of Companies and those for 2021
have been approved by the board and will be delivered in due course. The
auditors have reported on the 2020 and 2021 financial statements which carried
an unqualified audit report, did not include a reference to any matters to
which the auditor drew attention by way of emphasis and did not contain a
statement under section 498(2) or 498(3) of the Companies Act 2006.
While the financial information included in this announcement has been
compiled in accordance with, inter alia, International Financial Reporting
Standards (IFRS), this announcement does not in itself contain sufficient
information to comply with IFRS. The accounting policies used in the
preparation of this announcement are consistent with those in the full
financial statements including those applicable to SIS, given its materiality
to the Group as a whole.
CMG is an AIM quoted public limited company registered in England and Wales
where it is domiciled for tax purposes. Its financial statements are prepared
under the historical cost convention.
Going concern
The directors can report that based on the Group's budgets and financial
projections, they have satisfied themselves that the business is a going
concern covering a period of at least twelve months from the date of approval
of the financial statements. In assessing the Group as a going concern, the
directors are also mindful of the business of SIS that provides the entire
value of the Group. The directors are satisfied that SIS is a going concern.
The Board has a reasonable expectation that the Company and its Group have
adequate resources and facilities to continue in operational existence for the
foreseeable future and therefore the accounts are prepared on a going concern
basis.
2. Investment in associate
Year Ended 30 June 2021 Group
£
Cost
At 1 July 2020 12,474,980
Share of loss - 2021 (1,470,048)
Share of other comprehensive loss - 2021 (188,352)
Dividend received - 2021 -
Impairment of equity-accounted associate -
At 30 June 2021 10,816,580
Year Ended 30 June 2020 Group
£
Cost
At 1 July 2019 14,274,706
Share of profit - 2020 125,294
Share of other comprehensive loss - 2020 262,707
Dividend received - 2020 (1,026,884)
Impairment of equity-accounted associate (1,160,843)
At 30 June 2020 12,474,980
The Group's interest in its associate, SIS, a company incorporated in England
and Wales, is held by Alternateport Limited. Alternateport Limited 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 Limited is a wholly owned
subsidiary of Catalyst Media Holdings Limited, a wholly owned subsidiary of
Catalyst Media Group plc.
A copy of the strategic forecasts prepared by SIS was made available to the
Directors of CMG showing management forecasts of the income statement,
statement of financial position and statements of cash flow. SIS's management
have assumed a growing level of future profits at a steady rate over a period
of five years. CMG's management have used these assumptions and further
applied a discount rate of 15% to arrive at a present value. In conjunction
with these forecasts, the potential impact of the settlement of the ongoing
TRP litigation has also been considered and CMG's management have applied
further sensitivities in respect of other commercial factors including the
risk of renewal of several media rights contracts over the forecast period,
and the impact of the forecast growth of SIS on the level of its support
costs.
After reviewing the forecasts and other factor detailed above, the Directors
concluded that the carrying value of the investment in SIS of £10.8m is
appropriate and no impairment is required to this value. The Directors have
also concluded that there is insufficient indication or circumstances
justifying a reversal of previously recognised impairment charges.
Share of profit of associate 2021 2021 2020
CMG share CMG share
SIS Total
£'000 £'000
£'000
Revenue 130,107 26,724 43,667
Operating (loss) / profit after individually significant items
(8,297) (1,704) 743
Net interest receivable 307 63 155
Profit / (losses) on individually significant items
(622) (128) (735)
(Loss) / Profit before tax (8,612) (1,769) 163
Taxation 1,455 299 (38)
Share of loss / (profit) after taxation (7,157) (1,470) 125
Net income from associate (7,157) (1,470) 125
Other comprehensive income:
Actuarial (loss) / gain (1,411) (290) 404
Deferred tax 494 101 (141)
(917) (188) 263
Share of net assets and liabilities of associate
Gross assets 100,419 20,629 19,957
Net liabilities (47,771) (9,812) (7,482)
Net equity 52,648 10,817 12,475
As at 30 June 2021, SIS was continuing to deal with tax and legal issues that
arose from the 2010 Commonwealth Games (CWG) in Delhi, India. SIS, via a
partnership in the name of SIS Live, delivered the host broadcast production
and facilities contract for the 2010 CWG. Given continuing scrutiny of the
entire CWG project immediately after the closure of the Games, approximately
40% of the contract has still not been paid. A provision of £5.9 million was
made in respect of this non-payment in SIS's financial statements for its
financial year ended 31 March 2011. There has been no subsequent movement on
this provision to 30 June 2021.
SIS Live received a draft assessment in March 2014 from Indian tax authorities
in relation to the year ended March 2011. SIS has strongly rejected the draft
assessment, and continues to appeal it through the Indian judiciary system. As
appeal proceedings continue it is not possible to quantify the potential tax
liability that may arise or the subsequent recoverability of that amount
through the courts and therefore no further provision has been made in the
accounts of SIS.
As at 30 June 2021, SIS continued to be involved in a litigation case brought
by The Racing Partnership ("TRP") and others against SIS's subsidiary, Sports
Information Services Limited ("SISL"), and others. SISL has successfully
defended two of the three claims and, following the year end, both SISL and
TRP have been granted permission by the judge to appeal elements of the
judgement. SISL have been ordered by the judge to pay 20% of TRP's costs. The
full outcome of the litigation was still unknown at the year end of CMG. The
Directors of SIS included an estimate of the total costs of the claim within
SIS's results to 31 March 2021.
No adjustment has been to 30 June 2021 on the basis that there have been no
further developments to either case since 31 March 2021.
On 30 June 2021, SIS acquired 25% of the share capital of Racelab Pty Limited
for a net consideration of £2.9m with a potential to acquire a further
shareholding in future years. While the acquisition of Racelab Pty Limited is
a significant event arising after SIS's financial reporting date of 31 March
2021, the Directors have concluded that its impact on the Group's share of
SIS's results to 30 June 2021 is immaterial and therefore does not require
adjusting for.
3. Post balance sheet events
There were no events subsequent to the Statement of Financial Position which
require disclosure.
See note 2 of the full Annual Report and Financial Statements for a
description of the impact of the post balance sheet events as they relate to
SIS's reporting date (31 March 2021) on the Group's valuation of its
investment in associate as at 30 June 2021.
- ENDS -
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