Final Results

30th Oct 2009 07:00



30th October 2009

PROGRESSIVE DIGITAL MEDIA GROUP PLC 

(formerly TMN Group plc)

Final Results

Progressive Digital Media Group plc (AIM: PDM, the "Group" or the "Company") has published the final results for the year to 30 April 2009. 

Note: The results are reported prior to the reverse takeover of Progressive Digital Media Limited, which transacted on the 5 June 2009 and consequently do not include any financial information on Progressive Digital Media Limited.

These results should therefore be read in the context that they are for TMN Group only and do not include the results of Progressive Digital Media Limited. These accounts do however include such value adjustments, which have been made subsequent to the purchase of Progressive Digital Media Limited to conform with the englarged Group's accounting policies and to deal with relevant valuation issues. These adjustments are fully detailed in the audited statements. Whilst Progressive Digital Media Group plc (formerly TMN Group plc) is the acquiring entity in the transaction, under IFRS, Progressive Digital Media Limited is deemed to be the acquirer and the accounting for this transaction will be dealt with in the next set of results.

The interim Financial Statements for Progressive Digital Media Group plc to October 2009 will be released before the end of January 2010.

Highlights

		●	Group revenues £28.8m (2008: £22.5m)
		●	Group revenues excluding discontinued activities £27.9m (2008: £22.0m)
		●	Adjusted EBITDA £(5.4)m (2008: £3.1m). Adjusted EBITDA excludes amortisation of intangibles, depreciation and exceptional non-recurring costs
		●	Operating (loss)/profit £(18.8m) (2008: £1.9m)

Simon Pyper, PDM CEO, commented,

"The enlarged Group's continued investment in digital content, digital delivery platforms and operational infrastructure should allow the business to deliver long term profitable growth and ensure that we are well placed to exploit market opportunities and developments. 

With regards to the performance of the Group excluding TMN, the Board is pleased with the overall trading performance to date. Moreover, the Group is achieving profitable revenue growth across a number of its business platforms and industry sectors.

Whilst there is still much to do, the Board is satisfied that progress is being made and is confident of the long-term prospects of the business."

Enquiries:

PDM plc	0207 936 6000
Mike Danson, Chairman
Simon Pyper, CEO
Ken Appiah, Finance Director
Investec Investment Banking, NOMAD and Broker	0207 597 4000
Erik Anderson/ David Flin
Hudson Sandler	0207 796 4133
Nick Lyon/ James White

CHIEF EXECUTIVE STATEMENT AND OPERATING REVIEW

Reporting basis

The Group's financial statements for the year ended 30 April 2009 have been prepared in accordance with International Financial Reporting Standards (IFRS).

The results for the year ending 30 April 2009 are reported prior to the reverse takeover of Progressive Digital Media Limited, which transacted on the 5 June 2009.

These results should therefore be read in the context that they are for TMN Group only and do not include the results of Progressive Digital Media Limited. These accounts do however include such fair value adjustments, which have been made subsequent to the purchase of Progressive Digital Media Limited to conform with the englarged Group's accounting policies and to deal with relevant valuation issues, these adjustments are detailed below. Whilst Progressive Digital Media Group plc (formerly TMN Group plc) is the acquiring entity in the transaction, under IFRS, Progressive Digital Media Limited is deemed to be the acquirer and the accounting for this transaction will be dealt with in the interim results for the Group, which will be released before the end of January 2010.

With regards to the integration of the enlarged Group, the Board is satisfied that progress is being made and is confident of the long-term prospects of the business. 

Revenue

Including discontinued operations for the year ended 30 April 2009, revenues were £28.8m compared to 2008 revenues of £22.5m. On a proforma basis (which annualises the revenues of acquisitions made in 2008) and excluding the trading impact of discontinued activities, revenues decreased by 23% from £36.2m in 2008 to £27.9m in 2009. 

Revenue analysed by product category and region was as follows:

	Reported	Reported	Proforma
	£'m	£'m	£'m
	2009	2008	2008
Email marketing	8.6	13.1	15.9
Affiliate marketing	14.8	4.1	15.4
Research	2.6	2.7	2.7
Publishing	1.9	2.1	2.2
	────────	────────	────────
	27.9	22.0	36.2
	────────	────────	────────
United Kingdom	24.7	20.4	32.9
Netherlands	3.2	1.6	3.3
	────────	────────	────────
	27.9	22.0	36.2
	────────	────────	────────

On a proforma basis email marketing revenues showed a significant reduction compared to 2008 mainly as a result of the impact of the downturn in display advertising in the UK and Europe. Although the Group's mix of verticals has altered significantly over the last year, the downturn in financial services and automotive advertising has had a material impact on email marketing revenues. For the Group's three other product categories combined, there was a marginal 5% reduction in revenues year-on-year which should be seen in the context of the very severe downturn in the UK advertising market and challenging macro economic conditions in general.

Gross margin

Gross profit decreased by 19% to £8.5m (2008: £10.5m). The gross profit margin declined to 31% from 48% in 2008. Part of this is attributable to product mix, in particular, the full year impact of lower margin affiliate marketing. The Group has changed its accounting policy in relation to data acquisition costs which has resulted in a £1.2m reduction in gross profit in the current year. Data acquisition costs are now expensed as a cost of sale rather than being capitalised and amortised over two years as per the previous policy.

  

CHIEF EXECUTIVE STATEMENT AND OPERATING REVIEW (continued)

Adjusted results and prior year restatement 

The Group reported an operating loss of £18.6m for the year compared to an operating profit of £1.9m in 2008. To assist the understanding of underlying performance and remove the impact of non-cash and non-recurring items, adjusted EBITDA has been used as a basis for comparison:

	2009	2008
	£'m	£'m
Operating (loss)/profit	(18.6)	1.9
Amortisation of intangibles	2.5	0.8
Depreciation	0.5	0.2
Exceptional costs	10.2	0.2
	────────	────────
Adjusted EBITDA	(5.4)	3.1
	═════	═════

Exceptional costs comprise of restructuring costs, principally those associated with headcount reduction and impairment of goodwill, acquired and other intangible assets as shown below: 

		2009		2008
		£'m		£'m
Legal and professional costs relating to rejected offers for the business		-		0.2
Restructuring and reorganisation costs		0.7		-
Impairment of goodwill		4.5		-
Impairment of other intangible assets		4.9		-
Impairment of investments		0.1		-
		────────		────────
		10.2		0.2
		═════		═════

Included within administration expenses there are dilapidations charges of £0.2m and onerous lease provisions of £0.6m this year relating to two of the Group's unoccupied properties. During the year the Group changed the accounting policy in relation to the treatment of database acquisition costs. The previous policy was to capitalise the acquisition cost and amortise over two years. The new policy is to expense acquisition costs as a cost of sale. The impact of this change in relation to the prior year is disclosed in note 2 to the Consolidated Financial Statements. The provision for impairment of trade receivables was £2.2m at the year end (2008: £0.2m). This reflects a more prudent approach in light of the current economic environment.

Loss before interest, tax and exceptional costs

Reported losses before tax, interest and exceptional costs were £8.4m (2008: profit of £2.1m).

Taxation

The total tax credit for the year was £2.2m (2008: £0.4m charge). This is lower than the standard corporation tax rate as applied to the loss before tax principally as a result of expenses not deductible for tax and deferred tax not provided on losses. In relation to unrelieved tax losses, no deferred tax asset has been recognised. 

Balance sheet and net assets

Consolidated net assets reduced by £16.5m to £3.3m (2008: £19.8m). The majority of this reduction is attributable to the amortisation and impairment of intangible assets.

  

CHIEF EXECUTIVE STATEMENT AND OPERATING REVIEW (continued)

Net debt, cash flow and risk

Consolidated net debt was £2.8m at the year end compared to £0.3m at 30 April 2008. Net cash used in operating activities was £0.3m (2008: generated £1.5m) comprising of operating cash flow of £0.7m less £1.0m of interest and tax paid. 

Capital expenditure relating to computer hardware was £0.4m. The £0.3m cash outflow from acquisitions represents the final tranche of EDR deferred cash consideration.

The net cash inflow for the year was £0.6m (2008: outflow of £1.9m). The debt of £2.8m represents gross debt of £3.1m less cash of £0.3m held outside of the composite accounting arrangement with the Group's UK bankers. Gross debt consists of the amounts drawn down under a revolving credit facility. As a result of the completion of the acquisition of Progressive Digital Media Limited on 24 June 2009, £1.5m of the facility has been repaid. 

The majority of the Group's trade is denominated in the currencies of the jurisdiction in which trade is conducted. As a result, the Group has currency risk with regard to approximately 11% of revenues. No currency hedging is entered into as exposure to fluctuations in foreign currencies is not considered significant to the Group. The Group now has minimal exposure to interest rate and liquidity risk as a result of the repayment of borrowings following the completion of the acquisition.

Prospects for the future

The Group's prospects for the future, following the acquisition of Progressive Digital Media Limited, were set out in the circular to shareholders in June 2009. We intend to update shareholders on progress when the enlarged Group's interim results are announced in January 2010.

Key performance indicators (KPIs)

The Group uses a number of KPIs to monitor the performance of business units as well as the individual product categories within those units. These include but are not limited to, the following:

		-	Quality of databases in terms of activity levels, responsiveness, email deliverability, size and coverage;
		-	Organic revenue growth compared to market and peer group growth rates;
		-	Gross and operating profit margins as well as cash contribution to the Group's central cost base; and
		-	Working capital and cash management in terms of adherence to forecast, borrowing headroom and levels of trade receivables and payables.

Individual KPIs are currently being re-evaluated in light of the Group's trading performance and the recent reverse acquisition of Progressive Digital Media Limited.

S Pyper

Chief Executive Officer

  CONSOLIDATED INCOME STATEMENT

YEAR ENDED 30 APRIL 2009

		2009			2008
		Pre-exceptional costs	Exceptional costs	Total	Pre-exceptional costs	Exceptional costs	Total As restated
		£'000	£'000	£'000	£'000	£'000	£'000
Revenue		27,891	-	27,891	22,004	-	22,004
Cost of sales		(19,372)	-	(19,372)	(11,535)	-	(11,535)
		────────	────────	────────	────────	────────	────────
Gross profit		8,519	-	8,519	10,469	-	10,469
Administrative expenses Other administrative expenses		(14,353)	(661)	(15,014)	(7,494)	(225)	(7,719)
- amortisation of intangibles		(2,519)	-	(2,519)	(847)	-	(847)
- impairments		-	(9,579)	(9,579)	-	-	-
		────────	────────	────────	────────	────────	────────
Total administrative expenses		(16,872)	(10,240)	(27,112)	(8,341)	(225)	(8,566)
		────────	────────	────────	────────	────────	────────
Operating (loss)/profit		(8,353)	(10,240)	(18,593)	2,128	(225)	1,903
		────────	────────	────────	────────	────────	────────
Finance income				5			42
Finance costs				(204)			(51)
				──────────			────────
(Loss)/profit from continuing operations before taxation				(18,792)			1,894
Taxation credit/(charge)				2,230			(352)
				─────────			────────
(Loss)/profit from continuing operations after taxation				(16,562)			1,542
Profit on discontinued operations				167			37
				─────────			────────
(Loss)/profit for the year				(16,395)			1,579
				═════			═════
(Loss)/profit attributable to the equity holders of the parent				(16,395)			1,579
				═════			═════
(Loss)/earnings per share (note 5)
Basic (pence)				(21.5)p			2.8p
				═════			═════
Diluted (pence)				(21.5)p			2.7p
				═════			═════

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

YEAR ENDED 30 APRIL 2009

	Called up share capital £'000	Share premium account £'000	Merger reserve £'000	Equity shares to be issued £'000	Share option reserve £'000	Trans-lation reserve £'000	Retained earnings £'000	Total £'000
At 1 May 2007 as previously stated	105	5,809	-	687	426	121	2,618	9,766
Prior year restatement - change in accounting policy	-	-	-	-	-	-	(467)	(467)
	───────	───────	───────	───────	───────	───────	───────	───────
At 1 May 2007 as restated	105	5,809	-	687	426	121	2,151	9,299
Foreign exchange adjustment	-	-	-	-	-	25	-	25
Profit for the financial year	-	-	-	-	-	-	1,579	1,579
	───────	───────	───────	───────	───────	───────	───────	───────
Total recognised expense in the year	-	-	-	-	-	25	1,579	1,604
Issue of shares	3	1,864	7,174	(331)	-	-	-	8,710
Purchase of own shares	-	-	-	-	-	-	(109)	(109)
Share options exercised	-	75	-	-	-	-	-	75
Share options cancelled	-	-	-	-	(10)	-	10	-
Deferred tax on share options	-	-	-	-	-	-	165	165
Share-based payment	-	-	-	-	27	-	-	27
	───────	───────	───────	───────	───────	───────	───────	───────
At 1 May 2008 as restated	108	7,748	7,174	356	443	146	3,796	19,771
Foreign exchange adjustment	-	-	-	-	-	59	-	59
Loss for the financial year	-	-	-	-	-	-	(16,395)	(16,395)
	───────	───────	───────	───────	───────	───────	───────	───────
Total recognised expense in the year	-	-	-	-	-	59	(16,395)	(16,336)
Issue of shares	-	342	-	(356)	-	-	-	(14)
Share options exercised	-	-	-	-	(357)	-	357	-
Deferred tax on share options	-	-	-	-	-	-	(165)	(165)
At 30 April 2009	108	8,090	7,174	-	86	205	(12,407)	3,256

CONSOLIDATED BALANCE SHEET

AS AT 30 APRIL 2009

			2009	2008
				As restated
			£'000	£'000
Non-current assets
Goodwill			5,947	11,370
Other intangible assets			3,417	10,268
Property, plant and equipment			559	948
Investments			10	108
			────────	────────
			9,933	22,694
			────────	────────
Current assets
Inventories			-	277
Trade and other receivables			4,768	9,449
Cash and cash equivalents			253	2,702
Current tax receivable			624	-
			────────	────────
			5,645	12,428
			────────	────────
Total assets			15,578	35,122
			────────	────────
Current liabilities
Borrowings Trade and other payables			- 7,260	3,032 7,438
Current tax liabilities			-	924
Provisions for liabilities			292	1,408
			────────	────────
			7,552	12,802
			────────	────────
Non-current liabilities
Provisions for liabilities			801	786
Borrowings			3,012	-
Deferred tax liabilities			957	1,763
			────────	────────
			4,770	2,549
			────────	────────
Total liabilities			12,322	15,351
			────────	────────
			────────	────────
Net assets			3,256	19,771
			════════	════════
SHAREHOLDERS' FUNDS
Share capital			108	108
Share premium account			8,090	7,748
Merger reserve			7,174	7,174
Equity shares to be issued			-	356
Share option reserve			86	443
Translation reserve			205	146
Retained earnings			(12,407)	3,796
			────────	────────
Total equity			3,256	19,771
			═════	═════

CONSOLIDATED CASH FLOW STATEMENT

YEAR ENDED 30 APRIL 2009

			2009	2008
				As restated
			£'000	£'000
Cash flows from operating activities
Operating (loss)/profit			(18,593)	1,903
Adjustments for:
Depreciation			455	182
Amortisation			2,519	847
Loss on disposal of fixed assets			316	-
Share based payments expense			-	27
Impairment of intangibles and investments			9,579	9
Foreign exchange			49	25
Decrease in inventories			277	32
Decrease/(increase) in receivables			4,682	(2,359)
(Decrease)/increase in payables			(178)	1,405
Increase/(decrease) in provisions			1,450	(105)
Discontinued operations
Net cash inflow from operating activities from discontinued operations			167	37
			────────	───────
Cash generated from operations			723	2,003
Interest paid			(204)	(51)
Income tax paid			(788)	(444)
			────────	────────
Net cash (utilised by)/generated from operating activities			(269)	1,508
			────────	────────
Investing activities
Interest received			5	42
Purchases of plant, property and equipment			(372)	(384)
Purchases of intangible assets			(607)	(374)
Acquisition of subsidiaries			(300)	(2,539)
Adjustment to fair value of subsidiary			(872)	-
Net cash used in investing activities			────────	────────
			(2,146)	(3,255)
Financing activities
(Costs)/proceeds on issue of shares			(14)	75
Purchase of own shares			-	(109)
Loan note repaid			-	(100)
Loan finance			3,012	-
			────────	────────
Net cash generated by/(utilised in) financing activities			2,998	(134)
			────────	────────
Net increase/(decrease) in cash and cash equivalents			583	(1,881)
Cash and cash equivalents at the beginning of the year			(330)	1,551
			────────	────────
Cash and cash equivalents at the end of the year			253	(330)
			═════	═════

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

YEAR ENDED 30 APRIL 2009

1. GENERAL INFORMATION

 

Progressive Digital Media Group plc is incorporated and domiciled in the United Kingdom.

The financial information set out in this preliminary announcement does not constitute statutory accounts as defined in section 434 of the Companies Act 2006. The consolidated income statement, the consolidated statement of changes in equity, the consolidated balance sheet at 30 April 2009, the consolidated statement of cash flows and the associated notes for the year then ended have been extracted from the Group's financial statements upon which the auditor's opinion is unqualified and does not include any statement under section 498 of the Companies Act 2006. The statutory accounts for the year ended 30 April 2009 will be delivered to the Registrar of Companies following the Group's Annual General Meeting.

2. ACCOUNTING POLICIES

Basis of preparation

The Group's financial statements have been prepared in accordance with applicable IFRS as adopted by the European Union and IFRS as issued by the International Accounting Standards Board.

Going concern

The directors have undertaken a detailed review of the Group's trading forecasts, cash flow forecasts and available financial facilities in order to ensure that the preparation of the financial statements on the going concern basis is appropriate. This is based on an assessment of the enlarged Group following the reverse acquisition.

The directors consider the forecasts to have been prepared on a reasonable basis representing management's best estimates of the Group's trading and cash flows. The directors further note that management information for the first five months of 2009 indicate that the Group is, to date, performing in line with forecast.

Based on their review of the forecasts, the directors have assessed that the Group has, with a reasonable degree of headroom, access to sufficient cash flow to enable it to continue trading and to meet its liabilities as they fall due for the foreseeable future. In addition, the directors take comfort from the ongoing support from a significant shareholder, should the Group require making use of this. On this basis, the directors consider it appropriate to prepare the financial statements on a going concern basis, and have done so.

Overall considerations

The significant accounting policies that have been used in the preparation of these financial statements are set out in the financial statements.

The financial statements have been prepared using the measurement bases specified by IFRS for each type of asset, liability, income and expense. The measurement bases are more fully described in the financial statements.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

YEAR ENDED 30 APRIL 2009

2. ACCOUNTING POLICIES (continued)

Prior year adjustments 

During the year the Group changed its accounting policy in relation to the treatment of database acquisition costs. Previously the Group had capitalised the cost of acquiring email databases and amortised them over a two year period. The Board believes that a policy of expensing these costs as incurred represents the commercial reality of the transaction as the data concerned is not considered to have an enduring economic value. The directors are of the opinion that the cost of a database is a direct cost of servicing a particular client and that any enduring economic value is considered incidental.

The effect of the new policy on the Group for the year ended 30 April 2008 is set out in the table below. There is no affect on the Company's financial statements.

	2008
	As originally  stated	As restated
	£'000	£'000
Brought forward retained earnings at 1 May 2007	2,618	2,151
Income statement extracts:
Cost of sales (effect of expensing of additions in the year)	10,804	11,958
Administrative expenses (effect of reduction in amortisation charge)	7,489	6,881
Tax on profit	635	352
Profit for the year	1,842	1,579
Retained earnings at 30 April 2008	4,526	3,796
Balance sheet extracts:
Intangible assets:
Database acquisition costs	1,012	-
Domain names	166	166
	────────────	────────────
	1,178	166
	═════	═════
Deferred tax liability	2,046	1,763
	═════	═════

Basis of consolidation

The consolidated financial statements incorporate the results of the Company and all of its subsidiary undertakings up to 30 April 2009. Unless otherwise stated, the acquisition method of accounting has been adopted. Under this method, the results of the subsidiary undertakings acquired in the year are included in the consolidated income statement from the date of acquisition.

Significant accounting estimates and judgements 

Certain estimates and judgements need to be made by the directors of the Group which affect the results and position of the Group as reported in the financial statements. Estimates and judgements are required if, for example, as at the reporting date not all assets and liabilities have been settled and certain assets and liabilities are recorded at fair value which requires a number of estimates and assumptions to be made.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

YEAR ENDED 30 APRIL 2009

2. ACCOUNTING POLICIES (continued)

The major areas for estimation within the financial statements are as follows:

Revenue recognition

At each reporting period, the Group has a number of projects in progress. Management review each project's progress and reach a judgement as to the revenue that should be recognised in those business streams where revenue is recognised on a stage of completion basis. Management base this judgement on the best available project information.

Bad debt provision

At each reporting period, management review outstanding debts and determine appropriate provision levels. Needless to say, the recovery of certain debts is dependent on the individual circumstances of customers. There are a number of debts which remain outstanding past their due date, which management believe to be recoverable.

Provision for reward points

The provision for reward points represents the estimated future liabilities of unredeemed points where revenue attributable to the points issued has been recognised. The provision is calculated using a standard costing method making certain assumptions concerning redemption levels. In forming these judgements, the directors have assessed the anticipated future profile of points redemptions based on the Group's past experience of redemptions, the current run-rate of points accumulation and the age profile of the points in issue.

Impairment of intangible assets 

Determining whether intangible assets are impaired requires an estimation of the value in use of the cash-generating units ("CGU") to which intangible assets have been allocated. The value in use calculation requires the management to estimate the future cash flows expected to arise from the CGU and a suitable discount rate in order to calculate present value.

The major areas of judgement within the financial statements are as follows:

Deferred consideration

On deferred consideration for acquisitions and where performance criteria exist, the likelihood of the performance criteria being achieved are assessed to determine the level of consideration that is appropriate to recognise.

Recoverability of deferred tax assets

There is uncertainty over the recoverability of deferred tax assets. Management review forecasts for a two year period to assess the recoverability of the deferred tax asset. 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

YEAR ENDED 30 APRIL 2009

3. SEGMENTAL ANAYLSIS

Year ended  30 April 2009		Email marketing	Affiliate marketing	Research	Publishing & hosting	Central/ unallocated	Total
		£'000	£'000	£'000	£'000	£'000	£'000
Segment revenues - continuing operations		8,632	14,782	2,589	1,888	-	27,891
		═════	═════	═════	═════	═════	═════
Operating loss before exceptional costs		(1,803)	(3,093)	(542)	(396)	(2,519)	(8,353)
Exceptional costs		(8,904)	(183)	(85)	(9)	(1,059)	(10,240)
		────────	────────	────────	────────	────────	────────
Operating loss after exceptional costs		(10,707)	(3,276)	(627)	(405)	(3,578)	(18,593)
		═════	═════	═════	═════	═════	────────
Net finance costs							(199)
							────────
Loss before taxation							(18,792)
Taxation							2,230
Discontinued operations							167
							────────
Loss after tax							(16,395)
							═════
Other segment information
Capital expenditure		58	12	20	29	253	372
Depreciation & amortisation		1,069	1,456	27	33	389	2,974
		═════	═════	═════	═════	═════	═════

  NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

YEAR ENDED 30 APRIL 2009

3. SEGMENTAL ANALYSIS (continued)

Year ended 30 April 2008		Email marketing	Affiliate marketing	Research	Publishing & hosting	Central/ unallocated	Total as restated
		£'000	£'000	£'000	£'000	£'000	£'000
Segment revenues - continuing operations		13,175	4,087	2,690	2,052	-	22,004
		────────	────────	────────	────────	────────	────────
Operating profit before exceptional costs (as restated)		1,479	728	355	413	(847)	2,128
Exceptional costs		-	-	-	-	(225)	(225)
		────────	────────	────────	────────	────────	────────
Operating profit after exceptional costs (as restated)		1,479	728	355	413	(1,072)	1,903
		═════	═════	═════	═════	═════
Net finance costs							(9)
							────────
Profit before tax							1,894
Taxation							(352)
Discontinued operations							37
							────────
Profit after tax							1,579
							═════
Other Segment information
Capital expenditure		-	-	-	-	384	384
Depreciation & amortisation		178	-	91	352	408	1,029
Share based payment		-	-	-	-	27	27
		═════	═════	═════	═════	═════	═════

As these business streams are integrated with each other it is not possible to separately identify the segmental assets and liabilities held individually.

The Group's revenue from external customers and its geographic allocation of net assets may be summarised as follows:

		Year ended 30 April 2009				Year ended 30 April 2008
		Revenue		Assets		Revenue		Assets
		£'000		£'000		£'000		£'000
United Kingdom		24,716		3,120		20,385		19,169
Netherlands		3,175		136		1,619		602
		────────────		───────────		────────────		────────────
		27,891		3,256		22,004		19,771
		══════		═════		══════		══════

		Acquisition of property, plant and equipment		Acquisition of intangibles		Acquisition of property, plant and equipment		Acquisition of intangibles as restated
		£'000		£'000		£'000		£'000
United Kingdom		356		607		384		374
Netherlands		16		-		-		-
		────────────		───────────		────────────		────────────
		372		607		384		374
		═════════		════════		═════════		═════════

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

YEAR ENDED 30 APRIL 2009

4. OPERATING (LOSS)/PROFIT

Operating (loss)/profit is stated after charging:

		2009	2008
			as restated
		£'000	£'000
Amortisation of intangibles		2,519	847
Foreign exchange		45	12
Depreciation of owned assets		455	182
Loss on disposal of fixed assets		316	-
Auditor's remuneration (see below)		257	114
Operating lease expense - land and buildings		493	212
Exceptional costs (see below)		10,240	225
		═════	═════

Exceptional costs

		2009	2008
		£'000	£'000
Legal and professional costs relating to rejected offers for the business		-	225
Restructuring and reorganisation costs		661	-
Impairment of goodwill and intangible assets		9,579	-
		────────	────────
		10,240	225
		═════	═════

Auditors' remuneration

		2009	2008
		£'000	£'000
Fees payable to the Group's auditors for the audit of the Company's annual accounts		83	94
Other services (transaction and tax services)		150	20
Fees payable to the Company's auditors and their associates for other services to the Group		24	-
		────────	────────
		257	114
		═════	═════

In addition to the amounts shown above, the Group paid £15,042 (2008: £116,000) to the auditors in respect of costs. Relating to transaction support services which have been included within the cost of investments.

  NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

YEAR ENDED 30 APRIL 2009

5. (LOSS)/EARNINGS PER SHARE

The calculation of the basic loss per share is based on the loss for the year of £16,395,000  (2008: profit £1,579,000) divided by the weighted average number of shares in issue during the year of 76,098,315 (2008: 56,111,000). As the effect of share options is anti dilutive no diluted loss per share figure has been produced in the year to April 2009.

An adjusted loss per share has also been calculated based on the loss for the year before amortisation of acquisition related intangible assets and exceptional costs amounting to a total of £10,240,000 (2008: £1,072,000). The adjusted loss per share is therefore based on the adjusted loss for the year of £6,155,000 (2008: profit £2,651,000) divided by the weighted average number of shares in issue during the year of 76,098,315 (2008: 56,111,000) which results is an adjusted loss per share of 8.1 pence (2008: 4.7 pence). 

The calculation of earnings per share is based on the following (loss)/profits and number of shares:

	2009			2008
	Loss  £'000	Number of shares '000	Pence per share	Profit  as restated £'000	Number of shares '000	Pence per share as restated
Basic (loss)/earnings per share	(16,395)	76,098	(21.5)	1,579	56,111	2.8
	═════	═════	═════
Dilutive effect of securities:
Share options					1,789
Deferred consideration to be settled in shares					1,176
				────────	────────	────────
Diluted earnings per share				1,579	59,076	2.7
				═════	═════	═════

6. REPORT AND ACCOUNTS

The Group's annual report and financial statements will be, where required, posted to shareholders shortly; alternatively the annual report and financial statements are published on our corporate web site www.progressivedigitalmedia.com

7. ANNUAL GENERAL MEETING

The Annual General Meeting will be held on 27 November 2009 at 9am at 2 Gresham Street, London.

ENDFR CKCKDABDDNKB

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