21st Mar 2006 07:01
TV Commerce Holdings PLC21 March 2006 21 March 2006 TV Commerce Holdings PLC TV Commerce Holdings PLC ("TV Commerce" or the "Group"), the AIM-listed media and entertainment company specialising in TV, telephony entertainment content and broadcasting services, today reports its Preliminary Results for the year-ended 31 December 2005. Highlights / recent activity • Turnover of £723,992 with a pre-tax loss of £551,389 - in line with expectations • Continued growth in 'Your Destiny TV' interactive show with benefits from the increasing integration of TV, telephony and multi-media input. • Launch of mobile phone gaming joint venture with Probability Games Corporation in July 2005 • Launch of TV Gaming is planned for 2006 under newly granted Play2Win licence, with increased opportunities for cross-selling to existing customers. • Production of content for third parties increases studio utilisation • Group trading profitably and cash flow positive Commenting on the results TV Commerce Chief Executive Vince Stanzione said: "Building on our position within the interactive TV market, the Group hasbroadened its appeal across a variety of integrated platforms. We've seen anencouraging start to 2006 and the planned launch our new gaming formats shouldsee us reach an increasing customer base in the year ahead." For further information, please contact: TV Commerce Vince Stanzione Tel: +44 (0) 1908 330 747 First City Financial Ltd Allan Piper Tel: +44 (0) 207 436 7486 +44 (0) 7736 064 982 Seymour Pierce Stuart Lane Tel: +44 (0) 207 107 8029 Chairman's statement For the year ended 31 December 2005 I am pleased to report that the year to 31 December 2005 has been one of steadyprogress for the Group, leaving us excellently positioned in what has become arapidly developing interactive media content market. Following our arrival onAIM 13 months ago, development costs have led to losses in the year of £551,389on sales of £723,992 but the Group is now trading profitably and is cash flowpositive. We now offer a range of services that has carried us beyond our initialpositioning in the satellite TV sector. Alongside our highly successful "Your Destiny" programming, we have: • expanded into premium rate mobile texting, with products such as the LIVE 85588 psychic line and the Match 69698 dating and chat service. • taken our first step into the international marketplace with initial trials in the US and further trials planned for the Australian market. • moved into the increasingly popular interactive TV gaming market with our planned Quiz Roulette and other games. • expanded our production facilities to produce programming for other satellite and cable TV broadcasters. As a result, we have established a broad range of complimentary platforms whichinclude mobile and fixed line telephony (using MMS, SMS, WAP and 3G) togetherwith internet and web TV. Our key strength has become the appeal of ourservices distributed through an integrated range of formats, to a growingcustomer database. Psychic & astrology-themed multi-media content The "Your Destiny" show continues to grow in strength and, from itslaunch this year, has become a popular live interactive daytime programme. Theshow is now broadcast on Sky on both RAJ TV - EPG 187 and Bonanza - EPG 165,reaching approximately 8 million homes throughout the UK, Northern Ireland, theRepublic of Ireland and Europe. Your Destiny TV features well-known psychics, astrologers and clairvoyants.Viewers are able to interact with the show for one-to-one consultations viapremium rate telephone calls, text and multi-media messaging, which enables themto send in photos for aura readings, samples of their handwriting and photos oftheir palms for immediate reading. What makes the programme unique is the speed of response and live nature of itsinteraction with customers. Within 60 seconds of a customer sending a photo fromtheir phone with a question, our skilled presenters and psychics discuss thecontent with them. Our telephony partnership with Stream Group plc, announced on 10 March 2005, hasproven to be very successful with an excellent working relationship and similarbusiness culture of reacting quickly to customer demands and we continue to workwith them on a range of new and exciting projects. Also on our behalf, Requestec Ltd handles over 800 text messages per day on ourbehalf and we continue to work closely with them to develop TV-to-mobile as wellas photo and video messaging applications. In addition, by texting LIVE at anytime to 85588, an SMS short code owned by the Group, users can receive aresponse from our psychic text service. In September 2005, we launched a new dating and chat text service, promoted onYour Destiny TV. By texting MATCH to 69698 and answering a number of relevantquestions, users are able to contact other users in a supervised environmentwithout revealing their identity. There is a strong overlap between customersinterested in psychic and chat/dating services which improves the success ratein marketing MATCH to our existing Your Destiny TV customer database. Following initial trials to expand Your Destiny TV in the USA earlier in theyear, we are now setting up similar trials in Australia and Germany. Mobile casino gaming On 17 July 2005, the Group announced a joint venture with Probability GamesCorporation plc for the Group to promote a mobile telephone casino ("theCasino") developed by Probability Games. Profits from the joint venture aresplit equally between the two companies. The Casino includes games of blackjack, hi-low, roulette, poker and "fortune teller" - a mobile fruit machine that also provides daily horoscopes C which are downloaded to the user!s mobile phone. All of the games carry TV Commerce station branding and related content, such as programme schedules andpromotions. The games are free to download and have been tested on over 150 differenthandsets, with full customer support. Customers can then choose to play free orfor as little as 10p per game with the chance to win cash prizes. The Casino isthe only gaming business in the UK to hold a Small E-Money Issuer Certificatefrom the Financial Services Authority (FSA) and customers can top up theiraccount using SMS, IVR, Credit Card or Neteller. One of the key features of the Casino is that it incorporates a unique age andidentity verification system to prevent underage gambling and fraud, withautomatic daily play limits. TV gaming C Play2Win On 10 March 2006, the Group announced that Ofcom had granted TV Commerce a newbroadcasting licence in the name of Play2Win. The licence enables TV Commerceto broadcast a selection of interactive games on TV, the first of which is "QuizRoulette" which we plan to launch later in 2006. Quiz Roulette invites viewers to call a premium rate number with the answer to askill-based question which, if answered correctly, enters them into a draw withthe possibility of winning a £25 credit to play roulette. The selected viewersees a graphical presentation of their bet being placed on the roulette table,before seeing a presenter spin a real roulette wheel to provide the chance towin. The design and software content of the game is owned by TV Commerce, the rightsto which can be licensed to others users or markets. Other games planned forlater launch include slot machine and scratch card formats such as Jungle Diva. As well as profiting from the games, we also have the opportunity of earningadditional income from the database of players' telephone numbers generated. Itis likely that anyone who plays a competition or quiz on TV is interested ingames of skill or chance, enabling us to sell related products to that database. Programme production for third parties In order to maximise use of our TV production facilities, we continue to producecontent for third parties. To date, this has included commercials for Monstermobplc and Carphone Warehouse, and chat show content for Chatterbox TV and othershows. Summary We have come a long way in 2005, developing strong brands, infrastructure, and agrowing, loyal customer base. In 2006, trading in the first two months of theyear has been profitable and cash flow positive. With this in mind, the Boardremains confident of the outlook for the business within what continues to be anexciting and rapidly expanding sector. Andy MinternChairman Consolidated Profit and Loss AccountFor the year ended 31 December 2005 2005 2004 Notes £ £ GROUP TURNOVER 723,992 64,199 Cost of sales (908,741) (429,177) ------- ------- GROSS LOSS (184,749) (364,978) Administration expenses (380,010) (69,532) ------- ------- GROUP OPERATING LOSS (564,759) (434,510) Interest receivable and similar items 13,514 -Interest payable and similar charges (144) - ------- ------- LOSS ON ORDINARY ACTIVITIES BEFORE TAXATION (551,389) (434,510) TAXATION - - ------- ------- LOSS AFTER TAXATION (551,389) (434,510) ------- ------- Dividend - - RETAINED LOSS FOR THE YEAR (551,389) (434,510) ======= ======= Loss per ordinary share:Basic loss per share (in pence) 2 (1.0)p - Consolidated Balance SheetAs at 31 December 2005 2005 2004 Notes £ £ FIXED ASSETSTangible 16,141 - CURRENT ASSETSDebtors 300,495 132,385Cash at bank and in hand 4 179,807 75,309 ------- ------- 480,302 207,694 CREDITORS:amounts falling due within one year (150,129) (642,202) ------- ------- NET CURRENT ASSETS 330,173 (434,508) ------- ------- TOTAL ASSETS LESS CURRENT LIABILITIES 346,314 (434,508) CREDITORS:amounts falling due after more than one year - - ------- ------- NET ASSETS 346,314 (434,508) ======= ======= CAPITAL AND RESERVES Called up share capital 641,796 2Share premium account 624,066 -Merger Reserve 66,351 -Profit and loss account (985,899) (434,510) ------- ------- EQUITY SHAREHOLDERS' FUNDS 6 346,314 (434,508) ======= ======= Consolidated Cash FlowFor the year ended 31 December 2005 2005 2004 Notes £ £ RECONCILIATION OF LOSS BEFORE INTERESTAND TAXATION TO OPERATING CASH OUTFLOW Operating loss before interest and taxation (564,759) (434,510)Depreciation 949 -Increase in debtors (168,110) (132,385)Increase in creditors 112,927 37,202 ------- ------- Net cash outflow from operating activities (618,993) (529,693) Returns on investments and servicing of finance Interest received 13,514 -Interest paid (144) - ------- ------- 13,370 - Capital expenditure and financial investment Payments to acquire tangible fixed assets (17,090) - ------- ------- Net cash outflow before financing (622,713) (529,693) Financing Shares issued 1,248,761 2Flotation expenses (416,550) -Receipt of loans - 605,000Repayment of loans (105,000) - ------- ------- 727,211 605,002 ------- ------- Increase in net cash in the year 5 104,498 75,309 ======= ======= Notes to Financial StatementsFor the year ended 31 December 2005 1. Preliminary Statement This preliminary statement, which has been agreed with the Auditors, wasapproved by the Board on the 20 March 2005. It is not the Company's statutoryaccounts, which will be sent to shareholders shortly. The Group's financial statements consolidate the financial statements of TVCommerce Holdings PLC and its subsidiaries, TV Commerce Limited and The AdvertChannel Limited, each of which have been made up to 31 December 2005, accountedfor under merger accounting. The comparative Group financial statements reflectthe accounts of TV Commerce Limited from the date of incorporation (13 November2003) to 31 December 2004. 2. Loss per share Basic Loss per share is calculated by dividing the Group's loss after taxationof £551,389 by the weighted average number of shares in issue during the year of53,681,432. No diluted earnings per share are presented as the effect of the exercise ofshare options would be to decrease the loss per share. 3. Dividend The directors do not recommend a dividend for the year. 4. Reconciliation of net cash flow to movements in net funds 2005 2004 £ £ Increase in cash in the year 104,498 75,309Loans repaid / (received) 105,000 (605,000)Conversion of loans to equity 500,000 - ------- ------- Movement in net funds / (debt) in the year 709,498 (529,691) Net debt beginning of year (529,691) - ------- ------- Net funds / (debt) at end of year 179,807 (529,691) ======= ======= Notes to Financial StatementsFor the year ended 31 December 2005 5. Analysis of changes in net debt At beginning Cash Non-cash At end of year flow movements of year £ £ £ £ Cash at bank and in hand 75,309 104,498 - 179,807 Loans (605,000) 105,000 500,000 - ------- ------- ------- ------- Total (529,691) 209,498 500,000 179,807 ======= ======= ======= ======= 6. Shareholders! funds 2005 £ Beginning of the year (434,508)Retained loss for the year (551,389)Nominal value of shares issued in the year 641,796Share premium on new shares issued net of expenses 624,066Movement on Merger Reserve 66,349 ------- End of the year 346,314 ======= On 22 November 2004, the Company was incorporated with an authorised sharecapital of 1,000 £1 ordinary shares, of which 1 £1 ordinary share was allottedat par for cash. On 18 January 2005 the share capital was subdivided into 100,000 ordinary sharesof £0.01 each and, on the same date, the share capital was increased by thecreation of 124,900,000 shares, increasing the value of the authorised sharecapital to £1,250,000. On 18 January 2005, 43,367,200 ordinary shares of £0.01 each were issued inexchange for the whole of the issue share capita of TV Commerce Limited. On 10 February 2005, a further 20,662,332 ordinary shares of £0.01 each wereissued for a cash consideration of £1,239,740. Notes to Financial StatementsFor the year ended 31 December 2005 On 17 March 2005, 150,000 ordinary shares of £0.01 each were issued for a cashconsideration of £9,000. 7. Copies of the Annual Report and Financial Statements Copies of the Annual Report and Financial Statement will be sent to shareholdersand will be available from the Company!s registered office from 25 April 2006. 8. Annual General Meeting The Annual General Meeting will be held on 19 May 2006 at 10.00 am at theoffices of the Company at Broadcast Media Centre, Plane Tree Crescent, Feltham,Middlesex, TW13 7HF. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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