9th Sep 2013 11:38
LONDON (Alliance News) - Avesco Group PLC Monday said it swung to a third quarter pretax loss as a result of declining revenues and difficult trading conditions.
Avesco, which provides audio visual equipment and services to the live events, broadcast and entertainment industries, said it swung to a GBP3.7 million pretax loss for the three months to June 30, after a GBP1 million pretax profit for the corresponding period the year prior.
Despite this, Avesco still made a GBP41 million net profit for the three month period after it won approximately USD66 million from Disney as a result of Celador International's victory in its legal case against Disney over alleged unpaid royalties connected to its Who Wants to be a Millionaire? television programme, which Disney aired in the US.
Avesco has previously announced that it will return GBP31 million of the Disney cash to shareholders, subject to their approval at a future meeting.
"Our balance sheet has been significantly strengthened by the receipt of the Disney funds, which, even after tax and returns to shareholders and others, should see a net debt reduction of over GBP14 million, leaving gearing low, and the group well placed for the future," the company said in a statement.
However, Avesco said its German business was struggling to make enough profit following a restructuring that has seen the departure of key staff, while it said its Chinese business will not achieve last year's scheduled target of breaking even.
It also said the demand pick-up in the UK is below its previous expectations, though it said a number of sporting events, including Winter Olympics in Russia, the Commonwealth Games in Scotland and the FIFA World Cup in Brazil should help its businesses.
Avesco shares were Monday quoted at 200 pence, down 18.50 pence, or 8.5%.
By Samuel Agini; [email protected]; @samuelagini
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