REG - Zinc Media Group PLC - Interim results for the six months ended 30 June
27/09/2023 07:00
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RNS Number : 7196N Zinc Media Group PLC 27 September 2023
27 September 2023
Zinc Media Group plc
("Zinc Media", the "Group" or the "Company")
Interim results for the six months ended 30 June 2023
Zinc Media Group plc (AIM: ZIN), the award-winning television, brand and audio
production group, is pleased to announce its unaudited interim results for the
six months to 30 June 2023 ("H1 2023").
Headlines
The Group is pleased to report excellent progress in H1 2023 and continues to
trade in line with market expectations for the current financial year. The
first half of 2023 includes the following highlights:
· Revenue of £18.1m (H1 2022: £10.8m), an increase of 68%
year-on-year.
o Organic revenue growth (i.e. all businesses excluding The Edge) of 12% and
a strong customer base providing continuing high net revenue retention
o Growth in both TV and Content Production revenue
o The Edge continues to perform ahead of acquisition expectations
· Adjusted EBITDA(1) profit of £0.2m compared to an Adjusted
EBITDA profit of £0.1m in the whole prior financial year (H1 2022: loss of
£0.6m).
· Gross margins in the period were significantly up at 41% (H1
2022: 33%).
· Cash of £5.8m at 30 June 2023 is £2.2m higher than at 31
December 2022 due to working capital inflows.
· As at 25 September 2023, total revenue won and expected to be
recognised in FY23 is £35m. This is an increase of £4m since the last
trading update in July 2023 and an improvement of £8m compared to the same
point in 2022 in relation to that financial year.
· With £35m of revenue already won and expected to be recognised
this year, revenue for the whole year will significantly exceed the £30m of
revenue generated in FY22.
· The Group's pipeline remains strong with a further £7m of
revenue that can be recognised in FY23 in highly advanced discussions.
· Loss before tax in the period of £1.6m (H1 2022: £1.8m) is
mainly driven by costs relating to the acquisition of The Edge (revaluation of
deferred consideration due to The Edge's strong performance, amortisation,
unwinding of discounted deferred consideration), depreciation and finance
costs resulting from The Edge being in the Group this period, plus
depreciation and finance costs.
Operational Highlights
· The Group was awarded "Production Company of the Year" at the
prestigious New York Festival Film and Television Awards.
· The Group produced a number of highly acclaimed documentaries
that led the news agenda and got the nation talking including:
o Making global headlines with the documentary Putin vs The West, which was
one of the most watched programmes on BBC iPlayer.
o Bowelbabe: In Her Own Words for the BBC, which details the extraordinary
last five years of cancer campaigner Dame Deborah James' life, received
national press coverage, was on the front page of the Radio Times and has been
nominated for a Grierson award.
o Gender Wars, exploring the issue of transgender women's rights, was made
for Channel 4 as part of its remit to make agenda setting programmes which
tackle contentious issues.
· The Group won its largest ever television commission in a
two-year deal worth over £7m. The commission is from Channel 5 for 136
hours of the hit show Bargain Loving Brits.
· The Group produced its biggest ever digital branded content
commission Big in America with Alex Polizzi. It was commissioned by
the Department for Business & Trade and is being broadcast on LinkedIn.
· The Group has partnered with Idris Elba to produce Paid in Full:
The Battle for Payback (working title) for broadcasters CBC (Canadian
Broadcasting Corporation) and the BBC, examining the systematic exploitation
of black artists by the music industry.
· The Group's television label Atomic Television, only launched in
January 2023, won its first commission with a substantial contract worth over
£1m for an international blue-chip broadcaster.
Outlook
· The recent period of new business conversion underpins the
Board's confidence in meeting market expectations for the financial year,
including substantially increased Adjusted EBITDA profitability in the second
half of the year.
· The Edge is performing ahead of acquisition expectations and its
integration is progressing well: cross-divisional business development
opportunities have been identified and the co-location with Zinc's other
London businesses is complete which will enable cost savings and further
synergies.
· The Group has a strong pipeline of potential new business for
2024 and has £11m of revenue already won and expected to be recognised in
FY24. This is £5m ahead of revenue won at the same point last year for
recognition in the following year.
Mark Browning, Chief Executive, commented: "We are delighted with our H1
performance in a challenging content production market. Our year-on-year
increase of this scale bucks the market trend. This is the result of a
robust strategy rooted in organic growth alongside the acquisition of The
Edge. The investments made in the transformation plan are delivering, every
business in the Group is growing and we are confident of meeting market
expectations for the year."
A copy of the interim results will be made available on the Company's website,
(http://www.zincmedia.com/) zincmedia.com.
(( 1 ))Adjusted EBITDA is defined as EBITDA before Adjusting Items comprising
share based payment charges, profit/loss on disposal of fixed assets,
reorganisation and restructuring costs, acquisition costs and change in fair
value of contingent consideration
For further information, please contact:
Zinc Media Group
plc
+44 (0) 20 7878 2311
Mark Browning, CEO / Will Sawyer, CFO
www.zincmedia.com (http://www.zincmedia.com)
Singer Capital Markets (Nominated Adviser and Broker)
+44 (0) 20 7496
3000
James Moat / George Tzimas / Alex Emslie
IFC Advisory Ltd (Financial
PR)
+44 (0) 20 3934 6630
Graham Herring / Zach Cohen
CHAIRMAN'S STATEMENT
We are delighted to report a strong set of H1 results. Content production is
typically weighted to H2 so for the Group to report a small profit at Adjusted
EBITDA level, while maintaining investment for the longer term, is
outstanding. It is worth putting this performance in context. These H1
results are better than the full year results in 2021. This is the scale of
growth we are reporting.
In our interim results 12 months ago we said we were looking forward to
sustained profitability in 2023 and we are achieving this. With a positive
Adjusted EBITDA in H1, we are confident of at least delivering in line with
market expectations for the full year, which in turn will be Zinc's strongest
financial performance for many years.
This is a company transformed under this management team. They came to Zinc
with a track record of turning around underperforming media companies and the
results for Zinc are excellent. This turnaround is all the more impressive
given the run of poor market conditions which included Brexit, Covid, the
cost-of-living crisis and economic downturn impacting on commissioning
budgets.
Having invested over the past three years in starting new businesses to
increase our addressable market, we are pleased to report that both TV and
Content Production are increasing their revenue which is outstanding in this
tough market. This year more of the businesses are positively contributing at
Adjusted EBITDA level, which is demonstrated in the excellent Adjusted EBITDA
year on year performance. Some remain earlier in their investment phase and
therefore do not yet contribute positively to the Group's profit but they are
of strategic importance and we expect them to do so in time as we continue to
invest in their growth. Operating profit is now in sight and with it sustained
cash generation.
Creatively, H1 has also seen Zinc at the top of its game with our content
leading the national conversation with the likes of Gender Wars for Channel 4,
Bowelbabe: In her own words which told the story of Dame Deborah James,
Blackadder: The Lost Episode and Putin vs The West for the BBC. In
production we have Paid in Full: The Battle for Payback (working title) in
partnership with Idris Elba, The Grand Tour with Rob Rinder and Rylan Clarke
and Legends of Comedy with Lenny Henry. Much of the content produced by The
Edge and Zinc Communicate is confidential to those clients we work with, but
no less impressive.
Notwithstanding inflationary pressures, the tough content commissioning market
and the macro issues affecting the UK public markets, the future of Zinc Media
Group is looking brighter than ever. The Group is on course for a period of
steady organic growth and sustainable profitability, with the Board focused on
providing value to shareholders.
The Board would like to thank the management team, employees and freelancers
for their professional and dedicated work, and our shareholders for their
continued support.
Christopher Satterthwaite
Chairman
CEO'S REPORT
CURRENT TRADING, STRATEGY AND MARKET OUTLOOK
Trading in the first six months of the year has been excellent with organic
revenues increasing 12% to £12.1m (H1 2022: £10.8m), pushing total H1
revenue to £18.1m including The Edge, which was acquired in H2 2022. This
excellent performance sees the Group report Adjusted EBITDA profit of £0.2m
compared to a H1 2022 loss of £0.6m. For further context the H1 2021 loss
was £1.1m, which demonstrates the transformation within the Group.
Despite significant market headwinds in the UK, the FY23 position remains
strong with total revenue won and expected to be recognised in this financial
year of £35m (as at 25th September). This is an increase of £4m since the
last trading update in July 2023 and an improvement of £8m compared to the
same point in 2022 in relation to that financial year. This figure already
exceeds the £30m of revenue generated in the whole of FY22 and with £7m of
revenue at a highly advanced stage we expect further revenue to be won and
recognised this year.
The content commissioning market remains poor, particularly within the UK, but
the Group is trading strongly with £11m of revenue already won and expected
to be recognised in FY24, and this is supported by a healthy pipeline. For
context, at this point in 2022 there was £6m booked for FY23.
These financial results demonstrate the effectiveness of the transformation
plan enacted in 2019. Our strategy is anchored in investment in organic
growth, supplemented by strategic acquisitions, with the aim of delivering a
profitable and cash generative content creation group of significant scale
listed on the UK public market. Despite unprecedented headwinds caused by
Brexit, Covid and more recently inflation and the cost-of-living crisis, the
Group is delivering to plan and trading in line with market expectations.
Zinc Media Group now comprises 12 businesses, of which 8 are new since 2020.
All are united by a reputation as a trusted partner delivering the highest
quality content to our range of international and blue-chip clients in either
television production or production for brands and businesses. All Zinc
businesses benefit from a shared platform that offers a wide array of
resources, including post-production facilities, cutting-edge broadcast
technology, financial services, human resources support, public relations,
marketing expertise, and IT assistance. Additionally, some of the services
available through Zinc's platform are now being made accessible to third-party
production companies as a means of generating revenue.
The first six months of 2023 have seen a number of creative highlights and
further new business launches in the Group.
Our television labels continue to produce some of the UK's most talked about
television. H1 2023 has been outstanding for Zinc companies. In January
Putin vs The West made global headlines. This was closely followed by
Bowelbabe: In Her Own Words, which told the story of cancer campaigner Dame
Deborah James, and was featured on the front cover of The Radio Times. Gender
Wars for Channel Four sparked nationwide debate as it skilfully explored the
complex issue of trans-gender rights. Gold commissioned Blackadder: The Lost
Episode which marked the 40th anniversary of the hit show, and the BBC
launched a new daytime series Dr Xand's Con or Cure. Further successes
included the recommission of many Zinc programmes including the hit Bargain
Loving Brits in the Sun for Channel 5. The company announced a partnership
with Idris Elba to produce a series investigating the exploitation of Black
music artists and a series with Rylan Clark and Rob Rinder. Tern TV's Belfast
based division delivered another successful series of the daytime series
Critical Incident for BBC ONE and continues to produce the weekly BBC ONE
series Sunday Morning Live.
Zinc Communicate continues to grow steadily in the face of a difficult
advertiser market which is suppressing brand and marketing spend in the UK.
Despite this macro-level context, it secured the Group's biggest ever digital
branded content commission Big in America with Alex Polizzi. This was
commissioned by the Department for Business & Trade and is being
broadcast on LinkedIn. This piece of work demonstrates the power of the wider
Group as this was pitched and developed by Zinc Communicate but produced by
Tern TV. Zinc Communicate's documentary series The Future of Food, produced in
partnership with the World Farmers' Organisation, launches at COP28 in Dubai
later this year. Many of the clients in the Zinc Communicate portfolio of
businesses and The Edge keep the nature of the work confidential. One
significant new venture in H1 was the launch of the Group's first direct to
consumer podcast series, Tony Robinson's Cunningcast. Radio programmes in H1
included Marvel vs DC for BBC Sounds.
The Edge is performing ahead of acquisition expectations. H2 is typically
its strongest half of the year, driven by activity in the Middle East.
Integration is progressing well with the company now co-located with Zinc's
other London based businesses. Cross-divisional business development
opportunities have been identified and property cost savings will start to be
realised from H2 2023.
Despite the challenging wider market, the demand for high quality television
and content for brands and businesses remains strong, especially in markets
outside the UK, where Zinc has diversified in recent years and is further
enhanced by the acquisition of The Edge. Broadcasters, platforms, media owners
and brands continue to see content as a differentiator with their consumers.
Zinc Media Group now produces for all these markets and, while growing, still
maintains a relatively small market share. The Group therefore remains
confident of delivering further organic growth and profitability in the period
ahead.
Mark Browning
Chief Executive Officer
CFO'S REPORT
INCOME STATEMENT
Group revenues in the reporting period were up by 68% year-on-year to £18.1m
(H1 2022: £10.8m). TV revenues have grown by 20% to £11.0m (H1 2022:
£9.1m), driven by strong performance from the Red Sauce, Supercollider and
Rex labels that have only launched in the last few years, plus a strong H1
from Tern. Content Production revenue has grown by 331% to £7.1m (H1 2022:
£1.6m) which is driven by the acquisition of The Edge in H2 2022.
Gross margins in the period were 41% (H1 2022: 33%), with the growth
attributable to The Edge joining the Group which produces content at higher
gross margins than traditionally achieved in television. Despite downward
pricing and upward cost pressures, gross margins in the TV and Zinc
Communicate businesses have been maintained at the same levels as in FY22.
Operating expenses have risen by £3.3m to £8.7m, a 65% increase on the prior
year, which is slightly lower than the Group's revenue growth and is a result
of the acquisition of The Edge and continued investment for growth in Zinc
Communicate and the new Atomic label in television. Finance costs have risen
from £0.2m to £0.6m due to the unwinding of the discounted deferred
consideration in relation to The Edge acquisition and the interest rate on the
Group's long-term debt having increased.
Improved profitability is anticipated in H2 2023 as television production is
typically weighted to the summer and autumn months. This is in line with
market expectations.
Earnings per share
Basic and diluted loss per share in the period was 7.44p (H1 2022: 10.48p).
Dividend
No dividend is proposed. The Board considers the Group's investment plans,
financial position and business performance in determining when to pay a
dividend.
STATEMENT OF FINANCIAL POSITION
Assets
Cash at the end of June 2023 was £5.8m, having increased by £2.2m during the
period as a result of working capital improvements.
As at 22 September the Group's cash position was £5.7m.
Equity and Liabilities
The £2.6m increase in equity and liabilities results from the loss for the
period being offset by a £4.1m increase in trade and other payables, largely
due to an increase in contract liabilities resulting from cash received up
front from customers, which will unwind in future periods.
The Group had an outstanding balance on long-term debt of £3.5m as at 30 June
2023 which has remained unchanged (2022: £3.5m). The Directors believe the
Group has strong shareholder support, evidenced by shareholders investing
£5.0m in new equity last year to support the acquisition of The Edge. The
long-term debt holders are also major shareholders who own 42% of the Group's
shares, and the debt has no financial covenants.
Will Sawyer
Chief Financial Officer
Zinc Media Group plc consolidated income statement
For the six months ended 30 June 2023
Unaudited Unaudited Audited
Half Year to Half Year to Year to
30 June 30 June 31 December
2023 2022 2022
Note £'000 £'000 £'000
Revenue 3 18,072 10,775 30,083
Cost of sales (10,636) (7,263) (19,880)
Gross Profit 7,436 3,512 10,203
Operating expenses (8,435) (5,118) (13,083)
Operating loss (999) (1,606) (2,880)
Analysed as:
Adjusted EBITDA 157 (645) 75
Depreciation (760) (385) (947)
Amortisation (231) (352) (715)
Adjusting Items 4 (165) (224) (1,293)
Operating Loss (999) (1,606) (2,880)
Finance costs (584) (154) (390)
Finance income 2 - 1
Loss before tax (1,581) (1,760) (3,269)
Taxation (debit)/credit (35) 63 987
Loss for the period (1,616) (1,697) (2,282)
Attributable to:
Equity holders (1,623) (1,701) (2,297)
Non-controlling interest 7 4 15
Retained loss for the period (1,616) (1,697) (2,282)
Earnings per share
Basic Loss per Share 5 (7.44)p (10.48)p (12.43)p
Diluted Loss per Share 5 (7.44)p (10.48)p (12.43)p
Zinc Media Group plc consolidated statement of financial position
As at 30 June 2023
Unaudited Unaudited
Audited
30 June 30 June 31 December
2023 2022 2022
Note £'000 £'000 £'000
Assets
Non-current assets
Goodwill and intangible assets 6 7,451 3,464 7,671
Property, plant and equipment 7 1,126 850 1,056
Right-of-use assets 9 707 943 1,084
9,284 5,257 9,811
Current assets
Inventories 299 63 73
Trade and other receivables 8 11,350 6,327 10,591
Cash and cash equivalents 5,777 2,596 3,632
17,426 8,986 14,296
Total assets 26,710 14,243 24,107
Equity and liabilities
Shareholders' equity
Called up share capital 12 27 20 27
Share premium account 9,546 4,785 9,546
Merger reserve 558 27 457
Share Based payment reserve 566 369 566
Retained earnings (5,276) (3,087) (3,653)
Total equity attributable to equity holders of the parent 5,421 2,114 6,943
Non-controlling interests 23 28 16
Total Equity 5,444 2,142 6,959
Liabilities
Non-current
Borrowings 3,480 3,471 3,490
Provisions 11 371 250 242
Lease liabilities 9 164 530 352
Trade and other payables 2,643 128 2,476
6,658 4,379 6,560
Current
Trade and other payables 10 13,908 7,300 9,753
Current tax liabilities 237 4 160
Lease liabilities 9 463 418 675
Borrowings - - -
14,608 7,722 10,588
Total liabilities 21,266 12,101 17,148
Total equity and liabilities 26,710 14,243 24,107
Zinc Media Group plc consolidated statement of cash flows
For the six months ended 30 June 2023
Unaudited Unaudited Audited
Half year to Half year to Year to
30 June 30 June 31 December
2023 2022 2022
£'000 £'000 £'000
Cash flows from operating activities
Loss for the period before tax (1,581) (1,760) (3,269)
Adjustments for:
Depreciation 760 385 947
Amortisation and impairment of intangibles 231 352 715
Finance costs 584 154 390
Finance income (2) - (1)
Share based payment charge 101 92 180
(Gain)/Loss on disposal of assets (14) - -
Adjustment to property leases (129)
Consideration paid in shares - - 30
(50) (777) (1,008)
Decrease/(increase) in inventories (225) 164 191
(Increase)/decrease in trade and other receivables (720) (2,440) (2,841)
Increase/(decrease) in trade and other payables 4,082 501 (975)
Cash generated from / (used in) operations 3,087 (2,552) (4,689)
Finance income 2 - 1
Finance cost (23) - (57)
Net cash flows (used in)/generated from operating activities 3,066 (2,552) (4,689)
Investing activities
Purchase of property, plant and equipment (322) (115) (831)
Disposal of property, plant and equipment 14
Purchase of intangible assets (12) (16) (50)
Acquisition of subsidiary net of cash acquired - - (324)
Net cash flows used in investing activities (320) (131) (1,205)
Financing activities
Borrowings repaid (203) (111) (265)
Principal elements of lease payments (400) (218) (555)
Issue of ordinary share capital (net of issue costs) - - 4,767
Dividends paid to NCI (23)
Net cash flows generated used in financing activities (603) (329) 3,924
Net increase/(decrease) in cash and cash equivalents 2,143 (3,012) (1,970)
Translation differences 2 - (6)
Cash and cash equivalents at beginning of period 3,632 5,608 5,608
Cash and cash equivalents at end of period 5,777 2,596 3,632
Share Share Share based payment Merger Retained Non-controlling Total
capital premium reserve reserve earnings Total equity attributable to equity holders of the parent interest equity
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance at 1 January 2022 20 4,654 155 27 1,158 6,014 12 6,026
Total comprehensive income for the year - - - - (2,297) (2,297) 15 (2,282)
Equity-settled share-based payments - - 180 - - 180 - 180
Shares issued in placing net of expenses 6 4,761 - - - 4,767 - 4,767
Consideration paid in shares 1 - - 539 - 540 - 540
Shares issued in lieu of fees/Directors remuneration paid in shares - - - - 30 30 - 30
Dividends paid - - - - - - (23) (23)
Total transactions with owners of the Company 7 4,761 180 539 (2,267) 3,220 (8) 3,212
Balance at 31 December 2022 27 9,546 457 566 (3,653) 6,943 16 6,959
Balance at 1 January 2022 20 4,785 277 27 (1,386) 3,723 24 3,747
Total comprehensive income for the year - - - - (1,701) (1,701) 4 (1,697)
Equity-settled share-based payments - - 92 - - 92 - 92
Total transactions with owners of the Company - - 92 - (1,701) (1,609) 4 (1,605)
Balance at 30 June 2022 20 4,785 369 27 (3,087) 2,114 28 2,142
Balance at 1 January 2023 27 9,546 457 566 (3,653) 6,943 16 6,959
Total comprehensive income for the year - - - - (1,623) (1,623) 7 (1,616)
Equity-settled share-based payments - - 101 - - 101 - 101
Total transactions with owners of the Company - - 101 - (1,623) (1,522) 7 (1,515)
Balance at 30 June 2023 27 9,546 558 566 (5,276) 5,421 23 5,444
Notes to the consolidated financial statements
1) GENERAL INFORMATION
The Company is a public limited company incorporated in the United Kingdom.
The address of its registered office is 4th Floor, Saltire Court, 20 Castle
Terrace, Edinburgh EH1 2EN. Its shares are traded on the AIM Market of the
London Stock Exchange plc (LSE:ZIN).
2) BASIS OF PREPARATION
The interim results for the six months ended 30 June 2023 have been prepared
on the basis of the accounting policies expected to be used in the 2023 Zinc
Media Group plc Annual Report and Accounts and in accordance with the
recognition and measurement requirements of UK adopted International
Accounting Standards (IAS) but does not include all the disclosures that would
be required under IAS and should be read in conjunction with the accounts for
the period ended 31 December 2022.
The same accounting policies, presentation and methods of computation are
followed in these interim condensed set of financial statements as have been
applied in the Group's latest annual audited financial statements.
The interim results, which were approved by the Directors on 26 September
2023, are unaudited. The interim results do not constitute statutory
financial statements within the meaning of section 434 of the Companies Act
2006.
Comparative figures for the 12 months ended 31 December 2022 have been
extracted from the statutory accounts for the Group for that period, which
carried an unqualified audit report, did not include a reference to any
matters to which the auditor drew attention by way of emphasis of matter, did
not contain a statement under section 498(2) or (3) of the Companies Act 2006
and have been delivered to the Registrar of Companies.
3) SEGMENTAL INFORMATION
The operations of the group are managed in two principal business divisions
that generate revenue: Television and Content production. These divisions are
the basis upon which the management reports its primary segmental information.
The activities undertaken by the Television segment include the production of
television. The Content Production segment includes brand and corporate film
production, radio and podcast production and publishing.
Unaudited Unaudited Audited
Half Year to Half Year to Year to
30 Jun 2023 30 Jun 2022 31 Dec 2022
Revenues by Business Division (continuing operations) £'000 £'000 £'000
Television 11,004 9,135 20,218
Content production 7,068 1,640 9,865
Total 18,072 10,775 30,083
4) ADJUSTING ITEMS
Adjusting items are presented separately as, due to their nature or the
infrequency of the events giving rise to them, this allows shareholders to
understand better the elements of financial performance for the period, to
facilitate comparison with prior periods and to assess better the trends of
financial performance.
Unaudited Unaudited Audited
Half Year to Half Year to Year to
30 Jun 2023 30 Jun 2022 31 Dec 2022
£'000 £'000 £'000
Reorganisation and restructuring costs (39) (52) (160)
Acquisition costs - - (953)
Share based payment charge (101) (92) (180)
Profit on disposal of assets 14 - -
Other exceptional items (39) (80) -
Total (165) (224) (1,293)
5) EARNINGS PER SHARE
Basic loss per share (EPS) for the period equals the loss after tax from
continuing operations attributable to the Company's ordinary shareholders
divided by the weighted average number of issued ordinary shares.
When the Group makes a profit from continuing operations, diluted EPS equals
the profit attributable to the Company's ordinary shareholders divided by the
diluted weighted average number of issued ordinary shares. When the Group
makes a loss from continuing operations, diluted EPS equals the loss
attributable to the Company's ordinary shareholders divided by the basic
(undiluted) weighted average number of issued ordinary shares. This ensures
that EPS on losses is shown in full and not diluted by unexercised share
options or awards.
Unaudited Unaudited Audited
Half Year to Half Year to Year to
30 Jun 2023 30 Jun 2022 31 Dec 2022
£'000 £'000 £'000
Weighted average number of shares used 21,806,834 16,200,919 18,480,039
in basic and diluted earnings per share calculation
Potentially dilutive effect of share options 1,549,458 1,467,502 1,558,184
Basic Loss per Share (7.44)p (10.48)p (12.43)p
Diluted Loss per Share (7.44)p (10.48)p (12.43)p
6) GOODWILL AND INTANGIBLE ASSETS
Goodwill Brands Customer Relationships Software Distribution Catalogue Total
£000 £000 £000 £000 £000 £000
Net Book Value
At 30 June 2023 4,558 1,376 1,482 35 - 7,451
At 30 June 2022 3,055 64 279 37 29 3,464
At 31 December 2022 4,558 1,462 1,610 41 - 7,671
7) PROPERTY, PLANT AND EQUIPMENT
Land and buildings Office and computer equipment Total
Motor Vehicles
£000 £000 £000 £000
Net book value
As at 30 June 2023 146 6 974 1,126
As at 30 June 2022 222 - 628 850
As at 31 December 2022 185 7 864 1,056
8) TRADE AND OTHER RECEIVABLES
Unaudited Unaudited Audited
30 Jun 2023 30 Jun 2022 31 Dec 2022
£'000 £'000 £'000
Current
Trade receivables 7,520 4,380 6,872
Less provision for impairment (270) (467) (380)
Net trade receivables 7,250 3,913 6,492
Prepayments 566 523 507
Other receivables 787 3 1,047
Deferred tax 41 - -
Contract assets 2,706 1,888 2,545
Total 11,350 6,327 10,591
The carrying amount of trade and other receivables approximates to their fair
value. The creation and release of provision for impaired receivables have
been included in operating expenses in the income statement.
The maximum exposure to credit risk at the reporting date is the carrying
value of each class of asset above. The Group does not hold any collateral as
security for trade receivables. The Group is not subject to any significant
concentrations of credit risk.
9) LEASES AND RIGHT OF USE ASSETS
Right-of-use assets
Short leasehold land Office and computer equipment Total
and buildings
£'000 £'000 £'000
Balance as at 30 June 2022 867 76 943
Additions - 42 42
Acquired through business combinations 433 - 433
Depreciation (283) (51) (334)
Balance as at 31 December 2022 1,017 67 1,084
Additions 129 - 129
Depreciation (458) (48) (506)
Balance as at 30 June 2023 688 19 707
Lease
liabilities
Lease liabilities are presented in the statement of financial position as
follows:
Unaudited Unaudited Audited
30 Jun 2023 30 Jun 2022 31 Dec 2022
£000 £000 £'000
Current 463 418 675
Non-current 164 530 352
627 948 1,027
10) TRADE AND OTHER PAYABLES
Unaudited Unaudited Audited
30 Jun 2023 30 Jun 2022 31 Dec 2022
£'000 £'000 £'000
Current
Trade payables 1,892 1,297 1,415
Other payables 40 67 492
Other taxes and social security 1,275 770 1,149
Accruals 3,949 3,296 4,139
Contract liabilities 5,907 1,870 1,895
Contingent consideration payable 845 - 663
Total 13,908 7,300 9,753
Non-Current
Contingent consideration payable 2,643 - 2,476
Total 16,551 7,300 12,229
The Directors consider that the carrying amount of trade and other payables
approximates to their fair value. The Group's payables are unsecured.
11) PROVISIONS
30 Jun 30 Jun 31 Dec
2023 2022 2022
£'000 £'000 £'000
Provisions 371 250 242
Movement in provisions
£'000
At 30 June 2022 250
Net decrease in provision in the period (8)
At 31 December 2022 242
Net Increase in provision in the period 129
At 30 June 2023 371
The provisions relate to dilapidations on property leases.
12) SHARE CAPITAL
Unaudited Half Year Unaudited Half Year Audited Year
to 30 Jun 23 to 30 Jun 22 To 31 Dec 2022
Number of Shares Share Capital £'000 Number of Shares Share Capital £'000 Number of Shares Share Capital £'000
Ordinary Shares
At start of period 21,806,834 27 16,200,919 20 16,200,919 20
Share placing and subscription for cash - - - - 5,037,059 6
Consideration paid in shares - - - - 540,000 1
Shares issued in lieu of fees - - - - 28,856 0.3
At end of period 21,806,834 27 16,200,919 20 21,806,834 27
Total called up share capital 21,806,834 27 16,200,919 20 21,806,834 27
13) POST BALANCE SHEET EVENTS
There are no post balance sheet events to report.
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