REG-One Media iP Group Plc: Final Results
09/04/2019 07:05
09 April 2019
One Media IP Group Plc
(“One Media” or the “Group”)
Final Results and Notice of A.G.M.
One Media iP (AIM:OMIP), the digital media content provider which exploits
intellectual digital property rights around music, video and copyright
technology, announces its Full Year Results for the 12-month period ended 31
October 2018.
Financial Highlights
*
Revenue increased 16% to £2,702,374
*
EBITDA increased 44% to £773,071 (2017: £535,678)
*
Operating profit increased 94% to £638,758 (2017: £330,174)
*
Cash at 31 October 2018 of £5,576,379 (2017: £335,664)
Operational Highlights
*
Fundraise of £8.9m gross (before costs) in equity and debt to acquire music
publishing rights, artist recordings and songwriters’ rights
*
Appointment of Lord Michael Grade and Ivan Dunleavy to strengthen the Board
*
Another year of solid development for OMiP’s proprietary software, TCAT
(Technical Copyright Analysis Tool), which signed its second major
international record label client
*
Strong growth across the Group driven by a resurgent music industry which saw
its longest period of revenue growth since the 1990s, driven by increased
consumer demand and dividends from streaming platforms
*
Post period end, acquisition of Locomotive Records’ music catalogue for
US$750,000, including a direct artist royalty agreement with Spanish folk
metal band, Mägo de Oz
*
Announced today, the acquisition of certain rights relating to the composition
and writers share of the income in the Michael Dulaney catalogue of songs, an
American country music songwriter from Nashville, Tennessee, for a total
consideration of US $850,000, to be satisfied in cash.
Michael Infante, CEO of One Media iP commented:
“2018 demonstrated our determination to bring continued strong progress
across the Group, within the context of a resurgent music industry that is
seeing on-going growth in streaming. We appointed Lord Michael Grade and Ivan
Dunleavy to enhance the Board and, subsequently, raised capital to scale up
OMiP through the acquisition of music publishing rights and master rights.
“We continue to operate a selective approach with our acquisition programme
and, post period end, have made two acquisitions since the fundraise,
consisting of the Locomotive music catalogue and the acquisition of the
certain rights relating to the composition and writers share of the income in
the Michael Dulaney catalogue. Moving forward, we remain focused on acquiring
IP content and maximising our digital music and video income via the growing
global streaming stores such as Apple Music, Spotify, Amazon, Facebook and
Deezer.”
For further information, please contact:
One Media IP Group Plc
Michael Infante Chairman and Chief Executive Tel: +44 (0)175 378 5500
Alice Dyson-Jones Corporate Communications Tel: +44 (0)175 378 5501
Cairn Financial Advisers LLP Nominated Adviser
Liam Murray / Jo Turner Tel: +44 (0)20 7213 0880
Panmure Gordon (UK) Ltd Broker
Karri Vuori Tel: +44 (0)20 7886 2500
Chief Executive’s Statement
This has been a milestone year for One Media, during which we welcomed Lord
Grade and Ivan Dunleavy onto the Board, raised £8.9m in equities and debt to
fund acquisitions of music rights and saw growth across the Group.
Our operating profit for the Full Year was up 94% to £638,758 and cash at the
end of the period stood at £5,576,379. The Company achieved growth through
its technical ability and by developing our relationships with our
distribution partners.
Music
Over the last few years we’ve witnessed significant change, driven by
streaming which has now become the biggest single source of revenue in the
industry. However, it is the emerging technology in the sector where we now
see significant opportunities to further monetise our content. Artificial
Intelligence (AI) and smart, Voice Activated (VA) speakers have already begun
revolutionising how music is consumed. One Media’s in-house creative
technicians, using ‘best practices’, maximise the discoverability of One
Media’s recordings and ensure that they are curated in as many playlists as
possible. We are also now witnessing established giants such as YouTube Music
and Facebook add new royalty income sources as music is monetised on their
sites. All of these factors endorse our continued investment into content and
underpin our ability to keep pace with this fast-changing sector.
Focused on maximising the value of our existing catalogue of over 250,000
tracks, we were pleased to successfully place a number of synchronised music
pieces in film and TV during the year. This included our recording of
Chopin’s Nocturne Op No 2 in E-Flat Major from the Point Classics catalogue
featuring in Marvels Daredevil and Jim Carrey’s new TV series ‘Kidding’.
Video
Our archive Men & Motors footage grew in popularity on YouTube, generating
over 43 million minutes of viewing in 2018 and increasing to over 114,000
subscribers.
The Group’s music video, documentaries and special interest programs are
finding new platforms for distribution. We have seen content appear on Amazon
and other independent distributors as well as our country music videos being
broadcast on Keep It Country, a leading UK Freeview channel.
TCAT
Development work on TCAT is progressing and the team has made further strides
into digital fingerprinting. Over the year, the TCAT development team has been
focusing not just on One Media’s requirements but that of the industry, and
we were delighted to be able to announce that we successfully signed our
second major record label client as a result. At the period end the carrying
value for research and development in TCAT was £427,852.
Management and Team
The departure of Scott Cohen from the Board was announced on 6 February 2019,
and becomes effective today. Scott joined OMiP in 2007 and has been a huge
part of the journey thus far. Once again, I’d like to thank him on behalf of
the Board for his fantastic contribution and wish him every success for the
future.
I would also like to take this opportunity to thank all the One Media Team for
their continued hard work and dedication throughout the year.
Financial Overview
The year under review has seen revenues grow by 16% up to £2,702,374 and our
EBITDA up by 44% to £773,071 (2017: £535,678), driven by increased consumer
demand on streaming platforms and other revenue distributions from digital
platforms. Our operating profit is up to £638,758, a significant increase
over our 2017 figure of £330,174. In September the Company issued 48,250,001
new shares raising £2,895,000 of cash and drew down debt of £1,600,258 (net
of fees) from a new facility of £6,000,000. At the end of the period, our
cash balance was £5,576,379 (2017: £335,664). Our Gross margin has increased
to 51%. Overheads for the year are reported at £853,229 compared to 2017 at
£758,311.
The profit after tax attributable to equity shareholders of £405,016 (2017:
£266,772) is reported for the financial year. Reflecting an increase in
revenues, a reduced foreign exchange charge and increased margins. The
corporation tax expense of £81,488 in the period (2017: £30,829) includes
Research and Development allowances available to the Group. At the end of the
year our cash position is reported at £5,576,379 (2017: £383,051).
Acquisitions
Post period end we were delighted to announce the acquisitions of two
significant catalogues. Firstly, the catalogue of Locomotive Records in
February for $750,000, broadening our music library with contemporary Spanish
progressive rock music predominantly featuring the band Mägo de Oz. A great
addition to our catalogue and one which will enhance the Group’s growth of
streaming in regions like Spain and Latin America.
Following this, in April 2019 we were also extremely pleased to announce the
acquisition of the publishing and songwriter rights to songs written by
Michael Dulaney for $850,000. Dulaney has been a prolific songwriter over the
years and has had major hit songs performed by the likes of Faith Hill and
Jason Aldean.
Outlook
The Company is well placed to benefit from growth in the music industry and
growing its own catalogue of music rights. We have a strong pipeline of
opportunities and the Board looks to the future with confidence.
Michael Antony Infante
Chief Executive and Founder
Consolidated Statement of Comprehensive Income
For the year ended 31 October 2018
Year ended 31 October 2018 Year ended 31 October 2017
£ £
Revenue 2,702,374 2,337,624
Cost of sales (1,325,448) (1,281,897)
Gross profit 1,376,926 1,055,727
Administration expenses (738,168) (725,553)
Operating profit 638,758 330,174
Share based payments (115,061) (32,758)
Finance costs (37,201) -
Finance income 8 185
Profit on ordinary activities before taxation 486,504 297,601
Tax expense (81,488) (30,829)
Profit for period attributable to equity shareholders and total comprehensive income for the year 405,016 266,772
Basic earnings per share 0.44p 0.38p
Diluted earnings per share 0.40p 0.35p
The Consolidated Statement of Comprehensive Income has been prepared on the
basis that all operations are continuing activities.
Consolidated Statement of Changes in Equity
For the year ended 31 October 2018
Share Capital Share redemption reserve Share premium Share based payment reserve Retained earnings Total equity
£ £ £ £ £ £
At 1 November 2016 355,268 239,546 1,457,645 74,440 1,309,977 3,436,876
Share based payment charge - - - 32,758 - 32,758
Profit for the year - - - - 266,772 266,772
At 1 November 2017 355,268 239,546 1,457,645 107,198 1,576,749 3,736,406
Proceeds from the issue of new shares 322,750 - 2,983,000 - - 3,305,750
Fund raise costs - - (126,425) - - (126,425)
Share based payment charge - - - 115,061 - 115,061
Profit for the year - - - - 405,016 405,016
At 31 October 2018 678,018 239,546 4,314,220 222,259 1,981,765 7,435,808
Consolidated Statement of Financial Position at 31 October 2018
At 31 October 2018 At 31 October 2017
£ £
Assets
Non-current assets
Intangible assets 3,351,304 3,383,597
Property, plant and equipment 12,221 16,970
3,363,525 3,400,567
Current assets
Trade and other receivables 680,960 478,804
Cash and cash equivalents 5,576,379 383,051
Total current assets 6,257,339 861,855
Total assets 9,620,864 4,262,422
Liabilities
Current liabilities
Trade and other payables 526,224 491,619
Deferred tax 58,574 34,397
Total current liabilities 584,798 526,016
Borrowings 1,600,258 -
Total liabilities 2,185,056 526,016
Equity
Called up share capital 678,018 355,268
Share redemption reserve 239,546 239,546
Share premium account 4,314,220 1,457,645
Share based payment reserve 222,259 107,198
Retained earnings 1,981,765 1,576,749
Total equity 7,435,808 3,736,406
Total equity and liabilities 9,620,864 4,262,422
Consolidated Cash Flow Statement
For the year ended at 31 October 2018
Year ended 31 October 2018 Group Year ended 31 October 2017 Group Year ended 31 October 2018 Company Year ended 31 October 2017 Company
£ £ £ £
Cash flows from operating activities
Operating profit before tax 486,505 297,601 109,186 245,496
Amortisation 247,406 234,911 - -
Depreciation 7,653 3,350 - -
Share based payments 115,061 32,758 115,061 32,758
Finance income (8) (185) (1) (7)
Finance costs (Increase) in receivables 37,201 (202,155) - (15,229) 37,201 (195,110) - (255,691)
Increase/(decrease) in payables (87,013) (267,761) (13,472) 7,585
Corporation tax 27,104 - - -
Net cash inflow (outflow) from operating activities 631,754 285,445 52,865 30,141
Cash flows from investing activities
Investment in intellectual property rights and TCAT (215,113) (224,375) - -
Investment in property, plant and equipment (2,904) (13,868) - -
Finance income 8 185 1 7
Net cash used in investing activities (218,009) (238,058) 1 7
Cash flows from financing activities
Proceeds from the issue of new shares 3,305,750 - 3,305,750 -
Share issue costs (126,425) - (126,425) -
Loan notes 1,600,258 - 1,600,258 -
Net cash inflow (outflow) from financing activities 4,779,583 - 4,779,583 -
Net change in cash and cash equivalents 5,193,328 47,387 4,832,449 30,148
Cash at the beginning of the year 383,051 335,664 61,631 31,483
Cash at the end of the year 5,576,379 383,051 4,894,080 61,631
Notes to the Preliminary Results
Basis of preparation
The Company is a public limited company incorporated and domiciled in England
under the Companies Act 2006. The Board has adopted and complied with
International Financial Reporting Standards (IFRS) as adopted by the European
Union. The Company's shares were admitted for trading on the AIM market of the
London Stock Exchange on 18 April 2013.
Taxation
Year ended 31 October 2018 Year ended 31 October 2017
£ £
Analysis of the charge for the year
Adjustments to tax charge in respect of prior years 2,272 (22,940)
UK corporation tax charge 55,018 24,833
Deferred tax 24,198 28,936
81,488 30,829
The standard rate of tax for the year, based on the UK standard rate of
corporation tax is 19% (2017: 19.41%). The actual tax charge for the periods
is different than the standard rate for the reasons set out in the following
reconciliation:
Reconciliation of current tax charge Year ended 31 October 2018 Year ended 31 October 2017
£ £
Profit on ordinary activities before tax 486,504 297,601
Tax on profit on ordinary activities at 19% (2017: 19.41%) 92,436 57,765
Effects of:
Non-deductible expenses 24,660 9,304
Adjustments to tax charge in respect of previous periods 1,878 (8,270)
Fixed asset timing differences 24,198 11,579
Depreciation in excess of capital allowances 520 (660)
Share scheme deduction - -
Research and development (62,204) (38,889)
Total tax charge 81,488 30,829
Earnings per share
The weighted average number of shares in issue for the basic earnings per
share calculations is 92,244,794 (2017: 71,053,698) and for the diluted
earnings per share assuming the exercise of all warrants and share options is
100,714,200 (2017: 75,653,698).
The calculation of basic earnings per share is based on the profit for the
period of £405,016 (2017: £266,772). Based on the weighted average number of
shares in issue during the year of 92,244,794 (2017: 71,053,698) the basic
earnings per share is 0.44p (2017: 0.38p). The diluted earnings per share is
based on 100,714,200 shares (2017: 75,653,698) and is 0.40p (2017: 0.35p).
EBITDA
Profit from continuing activities before interest, tax, depreciation and
amortisation for the twelve months ended 31 October 2018 was £773,071 (2017:
£535,678).
Amendment of option agreement with director
Michael Infante, a director of the Company, has an option over 500,000
ordinary shares in the Company exercisable at a price of 2.75 pence per share
for an exercise period to 6 March 2019. The Company has agreed to amend the
terms of this option agreement by extending the exercise date to 6 March
2020. All other terms of the option agreement remain unchanged
Directors’ responsibilities
The Annual Report, including the financial information contained therein, is
the responsibility of, and was approved by the directors on 08 April 2019.
Availability of Report and Accounts and Notice of the Annual General Meeting
Copies of the Company’s Report and Accounts together with the Notice of the
Annual General Meeting, to be held at 09:30 a.m. on Thursday 16 May 2019 2019
at Panmure Gordon One New Change, London EC4M 9AF will be posted to
shareholders shortly. Copies of the Company’s Report and Accounts will also
be available at the registered office of the Company and can be viewed on the
Company’s website, www.onemediaip.com.
This announcement contains inside information for the purposes of Article 7 of
EU Regulation 596/2014.
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