Half-yearly Report

UTV Media plc ("UTV" or "the Group") Interim Results for the six months ended 30 June 2013 Financial highlights * - Group revenue of £55.2m (2012: £61.6m) - Pre-tax profits of £6.1m (2012: £10.7m) - Group operating profit of £7.8m (2012: £12.4m) - Net debt of £50.2m (June 2012: £50.0m) - Net finance costs of £1.6m (2012: £1.8m) - Pension deficit of £6.0m (2012: £12.4m) - Diluted adjusted earnings per share of 5.18p (2012: 8.78p) - Proposed interim dividend of 1.75p (2012: 1.75p) Operational highlights and prospects - Clear signs of return to revenue growth in all our business units - talkSPORT achieved highest audience in the station's history - talkSPORT successfully renewed exclusive national audiobroadcasting rights for two Premier League packages for the next threefootball seasons - talkSPORT extended its global audio rights agreement with thePremier League to offer exclusive live audio commentary of Barclays PremierLeague matches across Europe. The service now broadcasts in nine languages - Absence of a major sporting event and decline in the UK radiomarket impacted Radio GB in H1 but prospects for strong talkSPORT revenuegrowth from the World Cup in 2014 - Radio Ireland assets continued to outperform the market withstrong audience delivery - Television division again outperformed the network in audiencedelivery achieving the highest peak-time audience in three years - Merger of Simply Zesty and Tibus Digital Agency businesses toform one of Ireland's largest full service digital agencies - New Media restructuring will deliver improved offering andprofitability - Broadcast assets well placed to benefit from the improvingmacro-economic conditions - Strong cash generation remains a key feature of our business - Robust balance sheet with significant net debt reduction over thepast five years * As appropriate, references to profit include associate income John McCann, Group Chief Executive, UTV Media plc, said: "As expected the first half of the year has been challenging forthe Group. However, we remain confident about the prospects for growth in thesecond half and as we move into the 2014 World Cup year." For further information contact: Investor Enquiries www.utvmedia.com/investors John McCann, Group CEO +44 (0) 28 9032 8122Norman McKeown, Group Finance +44 (0) 28 9032 8122Director Media Enquiries Orla McKibbin, Head of +44 (0) 28 9026 2188 / +44 (0) 7879Communications 666 427 Maitland James Devas +44 (0) 20 7379 5151Chairman's Statement Introduction In my Chairman's Statement for 2012, I borrowed football parlancefrom pundits on talkSPORT to characterise the different fortunes of the earlyand latter parts of that year as a "game of two halves". That phrase mightagain be applied to 2013, as a slow first half starts to give way to animproving performance in the second half of the year. In particular, talkSPORT's revenue, which was impacted in the firstsix months by poor market conditions and the absence of a major sportingevent, is forecast to grow in the post summer months, contributing to anoverall improvement in GB Radio's performance. Similarly, Televisionadvertising revenue, which was down in the first half, has bounced back intopositive territory in the third quarter with strong growth being achieved inthe previously soft Republic of Ireland market. That Republic of Irelandmarket has also been difficult for our Irish Radio division in the first sixmonths, but growth is expected to return to that division in September. Thepreviously flagged restructuring of our New Media division is continuing as weseek to improve profitability in this area. Results and Dividend * Group revenue was £55.2m (2012: £61.6m) and Group operating profitwas £7.8m (2012: £12.4m) net of central group costs of £1.0m (2012: £2.2m).After a net interest charge of £1.6m (2012: £1.8m) and foreign exchange lossof £0.1m (2012: gain of £0.1m), Group profit before tax was £6.1m (2012:£10.7m). Diluted adjusted earnings per share were 5.18p (2012: 8.78p). Even with reduced operating profit and some one-off significantcash outflows in the period, the Group continues to be highly cash generative.Our expectation is for a stronger second half of the year and for furthergrowth in 2014. Accordingly, your Board considers that the interim dividendshould be maintained at 1.75p (2012: 1.75p). This will be paid on 15 October2013 to all shareholders on the Register at the close of business on 13September 2013. Radio * The positive impact of Euro 2012 in the first half last year wasalways going to present a tough comparator for talkSPORT. This, and a 9%reduction in the UK radio national advertising market, are the main factorsbehind a £3.4m fall in talkSPORT's UK advertising revenue. With our localradio revenue lower at £10.3m (2012: £10.7m), GB Radio's total revenue wasdown by 14% to £24.1m (2012: £27.9m). With costs £0.4m higher at £21.6m, dueprimarily to investment in talkSPORT International, GB Radio's operatingprofit fell to £2.5m (2012: £6.7m). Good progress has been made in extending the talkSPORT brand andcontent beyond the UK, on the back of our 2012 agreement to become GlobalAudio Partner of the Premier League. By the end of June 2013 we had securednew syndication partners in multiple markets including China, Malaysia andVietnam. In addition to these, more recently we announced agreements inSingapore and with the USA's Dial Global. We have also successfully extendedour agreement with the Premier League to include radio commentary insideEurope (excluding the UK and Ireland) for the first time. In Ireland, the radio advertising market continued to be difficultthroughout the first six months of 2013. Over the last few years, our verystrong audience delivery in the key urban areas has enabled us to consistentlyoutperform the market, which is estimated to be down by as much as 15% in thesix months to 30 June 2013. We again outperformed the market, with our IrishRadio revenue down by 12% in local currency and by 10% in sterling to £9.8m(2012: £10.8m). With costs held at last year's level, operating profit in ourIrish Radio division was £2.1m (2012: £3.1m). * As appropriate, references to profit include associate income Television Our Television advertising revenue in the first quarter wasnegatively impacted by the poor trading conditions in Ireland, offsetting agood performance in our revenue derived from London. This position wasreversed in the second quarter with a soft market in GB detracting from astronger performance in Ireland. Encouragingly, as noted above, Televisionadvertising revenue performance is much stronger in both Ireland and GB in thethird quarter. Overall, Television advertising revenue in the first half wasdown by 8% with total Television turnover at £15.3m (2012: £16.9m). WithTelevision operating costs reduced by 6%, Television operating profit in the 6months to 30 June 2013 was £3.3m (2012: £4.2m). New Media The restructured Tibus Digital Infrastructure business deliveredrevenues of £0.9m (2012: £1.0m) and continued to develop digital assets forkey projects within the Group, including talkSPORT International's livestreaming services and ongoing development of the UTV Player. Simply Zestycontinued to evolve from a specialist social media marketing agency,post-acquisition, into a full service digital agency following the merger withTibus Digital Agency, with revenue in the first six months up 19% to £1.4m(2012: £1.2m). Overall turnover in New Media for the first half was in linewith the previous year at £6.0m (2012: £6.0m), with operating profit at £0.9m(2012: £0.6m). Outlook The trading challenges of the first half have eased in the secondhalf of the year. We are encouraged that industry commentators continue to bepositive about the remainder of 2013 and it does appear that the last monthsof the year will make up much of the lost ground of the early months. In GB Radio, July advertising revenue was lower than last year butexpected growth in the post summer months augurs well for the rest of theyear, with talkSPORT forecast to be up by 5% and 10% year on year in Augustand September respectively. The prospect of additional internationalpartnerships and the build-up of interest in the FIFA World Cup, starting withthe draw at the end of this year, should provide further revenueopportunities. Irish Radio revenue slipped further in August but September isforecast to move into healthy growth and, after adjusting for FX, our revenueis expected to be up by 5% in the third quarter. Television advertisingrevenue is growing strongly in both GB and Ireland and is expected to be up by11% in the third quarter. In New Media, we expect operating profit to be up onthe same period for the previous year. Advertising revenue is strongly influenced by the broader economicenvironment and consumer confidence. Recent macroeconomic data suggests thatwe are heading towards recovery which should see advertising enjoy renewedgrowth. The recent growth experienced in television revenues, with theirlonger lead times, provides encouragement for a similar trend to be seen inour radio revenues. As we look towards 2014, the prospects for strong revenuegeneration for talkSPORT also appear promising. Nevertheless, the volatilityin our advertising revenue over the last eighteen months confirms that theroad to recovery is not necessarily a smooth one and we will continue,therefore, to be prudent in managing the affairs of the Group. Richard Huntingford Chairman 27 August 2013 Group Income Statementfor the six months ended 30 June 2013 Results Results before before Exceptional Exceptional Exceptional Exceptional Items Items Total Items Items Total 30 June 30 June 30 June 30 June 30 June 30 June Notes 2013 2013 2013 2012 2012 2012 (restated) (restated) (restated) £000 £000 £000 £000 £000 £000 Revenue 3 55,176 - 55,176 61,551 - 61,551Operating costs (47,398) - (47,398) (49,219) - (49,219) ------- ------- ------- ------- ------- -------Operating profit before tax andfinance costs 7,778 - 7,778 12,332 - 12,332 Share of results of associatesaccountedfor using the equity method 62 - 62 90 - 90 ------- ------- ------- ------- ------- -------Profit before tax and financecosts 3 7,840 - 7,840 12,422 - 12,422 Finance revenue 34 - 34 53 - 53Finance costs (1,648) - (1,648) (1,850) - (1,850)Foreign exchange (loss)/gain (172) - (172) 66 - 66 ------- ------- ------- ------- ------- -------Profit before tax 3 6,054 - 6,054 10,691 - 10,691 Taxation (1,211) (1,425) (2,636) (2,296) (1,684) (3,980) ------- ------- ------- ------- ------- -------Profit for the year 4,843 (1,425) 3,418 8,395 (1,684) 6,711 ------- ------- ------ ------- ------- ------Attributable to:Equity holders of the parent 4,704 (1,425) 3,279 8,210 (1,684) 6,526Non-controlling interest 139 - 139 185 - 185 ------- ------- ------- ------- ------- ------- 4,843 (1,425) 3,418 8,395 (1,684) 6,711 ------- ------- ------ ------- ------- ------ Earnings per share 2013 2012 (restated)Basic 6 3.44p 6.85pDiluted 6 3.42p 6.81pAdjusted 6 5.21p 8.83pDiluted adjusted 6 5.18p 8.78p All operations of the Group arecontinuing. Group Statement of Comprehensive Incomefor the six months ended 30 June 2013 30 June 30 June 2013 2012 (restated) £000 £000 Profit for the period 3,418 6,711 ------- ------- Other comprehensive income/(loss) Items that will not be reclassified subsequentlyto profit or loss:Actuarial gain/(loss) on defined benefit pensionschemes 3,325 (3,301)Income tax relating to items that will not bereclassified subsequently (765) 734 ------- ------- 2,560 (2,567) ------- -------Items that may be reclassified subsequently toprofit or loss:Cash flow hedges:Loss arising during the year (1) (134)Less transfers to the income statement 328 247 Exchange difference on translation of foreignoperations 2,488 (1,290)Income tax relating to items that may bereclassified (21) 31 ------- ------- 2,794 (1,146) ------- ------- Other comprehensive income/(loss) for the year,net of tax 5,354 (3,713) ------- ------- Total comprehensive income for the year, net oftax 8,772 2,998 ------- ------- Attributable to:Equity holders of the parent 8,633 2,813Non-controlling interest 139 185 ------- ------- 8,772 2,998 ------- ------Group Balance Sheetfor the six months ended 30 June 2013 30 30 31 June June December Notes 2013 2012 2012 (restated) £000 £000 £000 ASSETSNon-current assetsProperty, plant and equipment 7 12,109 11,566 11,910Intangible assets 180,209 176,133 176,589Investments accounted for using theequity method 166 216 104Deferred tax asset 2,501 5,623 4,250 ------- ------- ------- 194,985 193,538 192,853 ------- ------- -------Current assetsInventories 317 352 1,643Trade and other receivables 22,617 26,033 25,163Cash and short term deposits 9,066 14,606 10,958 ------- ------- ------- 32,000 40,991 37,764 ------- ------- -------TOTAL ASSETS 226,985 234,529 230,617 ------- ------- ------- EQUITY AND LIABILITIESEquity attributable to equity holdersof the parentEquity share capital 55,557 55,557 55,557Capital redemption reserve 50 50 50Treasury shares (123) (1,523) (1,523)Foreign currency reserve 8,506 5,881 6,018Cash flow hedge reserve - (444) (251)Retained earnings 28,277 22,439 28,680 ------- ------- ------- 92,267 81,960 88,531Non-controlling interest 619 510 480 ------- ------- -------TOTAL EQUITY 92,886 82,470 89,011 ------- ------- -------Non-current liabilitiesFinancial liabilities 8 56,343 62,967 58,948Pension liability 10 6,041 11,170 12,409Provisions 387 744 800Deferred tax liabilities 37,964 36,937 36,154 ------- ------- ------- 100,735 111,818 108,311 ------- ------- -------Current liabilitiesTrade and other payables 26,175 31,769 26,033Financial liabilities 8 4,388 4,526 4,292Derivative financial liabilities - 570 324Tax payable 2,016 2,944 2,275Provisions 785 432 371 ------- ------- ------- 33,364 40,241 33,295 ------- ------- -------TOTAL LIABILITIES 134,099 152,059 141,606 ------- ------- -------TOTAL EQUITY AND LIABILITIES 226,985 234,529 230,617 ------- ------- ------- Group Cash Flowfor the six months ended 30 June 2013 30 June 30 June 2013 2012 (restated) £000 £000Operating activitiesProfit before tax 6,054 10,691Adjustments to reconcile profit before taxtonet cash flows from operating activitiesForeign exchange loss/(gain) 172 (66)Net finance costs 1,614 1,797Share of results of associates (62) (90)Depreciation of property, plant andequipment 945 834Amortisation of intangible assets 188 -Non cash decrease in contingentconsideration (1,369) -Loss/(profit) from sale of property, plantand equipment 5 (194)Share based payments 225 283Difference between pension contributionspaid and amountsrecognised in the income statement (3,043) (963)Decrease in inventories 1,325 1,181Decrease in trade and other receivables 3,139 4Decrease in trade and other payables (5,952) (4,829)Decrease in provisions 1 (25) ------- -------Cash generated from operations 3,242 8,623 Tax paid (672) (178) ------- -------Net cash inflow from operating activities 2,570 8,445 ------- -------Investing activitiesInterest received 36 64Proceeds on disposal of property, plant andequipment 6 263Purchase of property, plant and equipment (1,059) (1,184)Outflow on acquisition of subsidiaryundertaking (200) (1,670)Outflow on acquisition of radio licences - (180) ------- -------Net cash flows from investing activities (1,217) (2,707) ------- -------Financing activitiesBorrowing costs (884) (1,137)Swap cost (328) (247)Refinancing cost - (936)Dividends paid to equity shareholders (18) (8)Dividends paid to non-controlling interests - (144)Repayment of borrowings (2,139) (61,416)Proceeds from borrowings - 65,595 ------- -------Net cash flows used in financing activities (3,369) 1,707 ------- -------Net (decrease)/increase in cash and cashequivalents (2,016) 7,445 Net foreign exchange differences 124 (44)Cash and cash equivalents at 1 January 10,958 7,205 ------- -------Cash and cash equivalents at 30 June 9,066 14,606 ------- ------ Group Statement of Changes in Equityfor the six months ended 30 June 2013 Equity Capital Foreign Cashflow Share Non- share redemption Treasury currency hedge Retained holder controlling capital reserve shares reserve reserve earnings equity interest Total (restated) (restated) (restated) £000 £000 £000 £000 £000 £000 £000 £000 £000 At 1 January 2012 55,557 50 (1,523) 7,171 (521) 22,414 83,148 469 83,617 ------ ------- ------- ------- ------- ------- ------- ------- ------- Profit for the -period - - - - 6,526 6,526 185 6,711Othercomprehensive(loss)/income inthe period - - - (1,290) 77 (2,500) (3,713) - (3,713) ------ ------ ------- ------- ------- ------- ------- ------- -------Total netcomprehensive(loss)/income inthe period - - - (1,290) 77 4,026 2,813 185 2,998 Share basedpayment - - - - - 283 283 - 283Equity dividendspaid andpayable - - - - - (4,284) (4,284) (144) (4,428) ------ ------- ------- ------- ------- ------- ------- ------- -------At 30 June 2012 55,557 50 (1,523) 5,881 (444) 22,439 81,960 510 82,470 ------ ------- ------- ------- ------- ------- ------- ------- ------- Profit for the -period - - - - 8,351 8,351 172 8,523Othercomprehensiveincome/(loss) intheperiod - - - 137 193 (717) (387) - (387) ------ ------ ------- ------- ------- ------- ------- ------- -------Total netcomprehensiveincome in theperiod 137 193 7,634 7,964 172 8,136 Share basedpayment - - - - - 273 273 - 273Equity dividends -paid - - - - (1,666) (1,666) (202) (1,868) ------ ------- ------- ------- ------- ------- ------- ------- -------At 31 December 50 (251) 88,5312012 55,557 (1,523) 6,018 28,680 480 89,011 ------ ------- ------- ------- ------- ------- ------- ------- ------- Profit for the -period - - - - 3,279 3,279 139 3,418Othercomprehensiveincome in theperiod - - - 2,488 251 2,615 5,354 - 5,354 ------ ------- ------- ------- ------- ------- ------- ------- -------Total netcomprehensiveincome in the year - - 2,488 251 5,894 8,633 139 8,772 Treasury sharesissued - - 1,400 - - (1,521) (121) - (121)Share basedpayment - - - - - 225 225 - 225Equity dividendspaid andpayable - - - - - (5,001) (5,001) - (5,001) ------ ------- ------- ------- ------- ------- ------- ------- -------At 30 June 2013 55,557 50 (123) 8,506 - 28,277 92,267 619 92,886 ------ ------- ------- ------- ------- ------- ------- ------- ------- Notes to the accounts 1. Basis of preparation The interim financial statements have been prepared in accordance with IAS34"Interim Financial Reporting" and the Disclosure and Transparency Rules of theFinancial Conduct Authority. In addition, except for the adoption of new standards effective from 1 January2013 as noted below, the interim financial statements have been prepared on abasis consistent with the accounting policies set out in the Group's annualReport and Accounts for the year ended 31 December 2012. The Group Income Statement, the Group Statement of Comprehensive Income,the Group Statement of Changes in Equity and affected notes have beenrestated for the 6 months ended 30 June 2012 and the year ended 31December 2012, to reflect changes in the calculation of pension costs inaccordance with IAS19 "Employee Benefits (Revised)". The net charge to theIncome Statement for the 6 months ended 30 June 2012 increased by£263,000, on a pre tax basis, with a tax impact of £60,000, following theintroduction of the concept of recognising net interest on the net definedbenefit obligation in place of the interest on the defined benefitobligation and the expected return on plan assets recognised under theoriginal standard. In conjunction with this change the directors have alsoreclassified from operating costs to other finance costs the net financecost arising on defined benefit obligations. The net effect of thesechanges has been to increase operating costs and reduce operating profitby £64,000 and increase other finance costs by £199,000. The correspondingimpact for the year ended 31 December 2012 was an increased charge of£525,000 pre tax, with a tax impact of £121,000. The restatements werereflected in the Group Statement of Comprehensive Income. There was noimpact on the disclosed defined benefit obligation at either period end. The amendments to IAS 1 introduce a grouping of items presented in othercomprehensive income (OCI). Items that could be reclassified (or recycled)to profit or loss at a future point in time now have to be presentedseparately from items that will never be reclassified. The amendmentaffected presentation only and had no impact on the Group's financialposition or performance. IFRS 13 establishes a single source of guidance under IFRS for all fairvalue measurements. IFRS 13 does not change when an entity is required touse fair value, but rather provides guidance on how to measure fair valueunder IFRS when fair value is required or permitted. The application ofIFRS 13 has not materially impacted the fair value measurements carriedout by the Group. IFRS 13 also requires specific disclosures on fairvalues, some of which replace existing disclosure requirements in otherstandards, including IFRS 7 Financial Instruments: Disclosures. Some ofthese disclosures are specifically required for financial instruments byIAS 34 and thereby affect the interim condensed consolidated financialstatements period. The relevant disclosures are reflected in note 9. The balance sheet at 30 June 2012 has been restated to reclassify thecontingent consideration from trade and other payables to financialliabilities in line with the classification in the financial statementsfor the year ended 31 December 2012. The relevant amounts are reflected innote 8. The exceptional items for the period ended 30 June 2012have been restated to remove international start-up costs and theassociated tax credit which, in the financial statements for the yearended 31 December 2012, were not deemed to be exceptional due tomateriality and were therefore included within operating costs within theRadio GB operating segment. These interim financial statements have been prepared on the going concernbasis as the directors, having considered available relevant information,have a reasonable expectation that the Group has adequate resources tocontinue in operational existence for the foreseeable future. The interim results are unaudited but have been formally reviewed by theauditors and their report to the Company is set out at the end of thisInterim Report. The information shown for the year ended 31 December 2012does not constitute statutory accounts within the meaning of Section 434of the Companies Act 2006 and has been extracted from the Group's 2012Annual Report, which has been filed with the Registrar of Companies. Thereport of the auditors on the accounts contained within the Group's 2012Annual Report was unqualified and did not contain a statement under eitherSection 498(2) or Section 498(3) of the Companies Act 2006 regardinginadequate accounting records or a failure to obtain necessary informationand explanations 2. Seasonality and cyclicality There is no significant seasonality or cyclicality affecting theinterim results of the operations. 3. Segmental information The Group operates in four principal areas of activity - radio in GB, radio inIreland, commercial television and new media. These four principal areas ofactivity also form the basis on which the Group is managed and reports areprovided to the Chief Executive and the Board. The following is an analysis ofthe revenue and results for the period, analysed by reportable segment.Central costs, which had previously been included within the Televisionsegment, are now reported separately to the Chief Executive and the Board andare therefore now analysed separately below. The Television segment operatingprofit for 30 June 2012 has been restated for this and for the impact of IAS19 "Employee Benefits (Revised)" as outlined in note 1. Radio GB segmentoperating profit for the six months ended 30 June 2012 has been restated asdetailed in note 1. Revenue Six months ended 30 June 2013 Radio Radio GB Ireland Television New Media Total £000 £000 £000 £000 £000 Sales to third parties 24,028 9,770 15,318 6,060 55,176Intersegmental sales 372 630 1,016 91 2,109 ------- ------- ------- ------- ------- 24,400 10,400 16,334 6,151 57,285 ------- ------- ------- ------- ------- Six months ended 30 June 2012 Radio Radio GB Ireland Television New Media Total £000 £000 £000 £000 £000 Sales to third parties 27,862 10,821 16,878 5,990 61,551Intersegmental sales 406 642 1,455 69 2,572 ------- ------- ------- ------- ------- 28,268 11,463 18,333 6,059 64,123 ------- ------- ------- ------- -------3. Segmental information (continued) Results Six months ended 30 June 2013 Radio Radio GB Ireland Television New Media Total £000 £000 £000 £000 £000 Segment operatingprofit 2,398 2,074 3,384 923 8,779 ------- ------- ------- ------- Central costs (1,001)Associate income 62 -------Profit before tax andfinancecosts 7,840 Net finance cost (1,614)Foreign exchange loss (172) -------Profit before taxation 6,054 -------Results Six months ended 30 June 2012 Radio Radio GB Ireland Television New Media Total (restated) (restated) (restated) £000 £000 £000 £000 £000 Segment operatingprofit 6,639 3,107 4,210 575 14,531 ------- ------- ------- ------- Central costs (2,199)Associate income 90 -------Profit before tax andfinancecosts 12,422 Net finance cost (1,797)Foreign exchange gain 66 -------Profit before taxation 10,691 ------- 4. Exceptional tax charge 30 June 30 June 2013 2012 (restated) £000 £000 Exceptional tax credit (i) - 751Exceptional tax charge (ii) (1,425) (2,435) ------- ------- (1,425) (1,684) ------- -------(i) In the budget on 21 March 2012, the Autumn Statement on 5 December 2012 and the budget on 20 March 2013, tax changes were announced for the UK which have an impact on the Group's current and future tax position. The exceptional tax credit of £751,000 in 2012 arose from the restatement of the relevant deferred tax balances to reflect the change in the UK corporation tax rate from 25% to 24% with effect from 1 April 2012, which was substantially enacted on 26 March 2012. As at 31 December 2012, the revision of the corporation tax from 24% to 23% from April 2013 had been substantially enacted. Accordingly all the deferred tax balances subject to UK corporation tax were calculated at 23% at 31 December 2012 resulting in a further exceptional deferred tax credit of £748,000 in the second half of 2012. On 3 July 2013, the revision of the UK corporation tax rate to 21% from 1 April 2014 and to 20% from 1 April 2015 was substantially enacted. As a result, it is expected that the deferred tax will be calculated at 20% at 31 December 2013 and that an exceptional deferred tax credit of £2,620,000 will be recognised in the second half of the year. (ii) In the finance bill published on 13 February 2013, the rate of corporate capital gains in the Republic of Ireland was increased from 30% to 33%. The exceptional tax charge of £1,425,000 in 2013 arises from the restatement of the relevant deferred tax assets and liabilities to reflect this. In the finance bill published on 8 February 2012 and passed into law on 2 April 2012, the rate of capital gains tax in the Republic of Ireland was increased from 25% to 30%. The exceptional tax charge of £2,435,000 in 2012 arises from the restatement of the relevant deferred tax assets and liabilities to reflect this. 5. Dividends 30 June 30 June 2013 2012 £000 £000Equity dividends on ordinary sharesDeclared at the AGM during the periodFinal for 2012: 5.25p (2011: 4.50p) 5,001 4,284 ------- ------- Proposed but not recognised as a liability at 30 JuneInterim for 2013: 1.75p (2012: 1.75p) 1,677 1,666 ------- ------- The final dividend for 2012 was paid on 15 July 2013 (2011:16 July 2012). 6. Earnings per share Basic earnings per share is calculated based on the profit for thefinancial period attributable to equity holders of the parent and on theweighted average number of shares in issue during the period. Adjusted earnings per share are calculated based on the profit forthe financial period attributable to equity holders of the parent adjusted forthe exceptional items and the impact of net finance costs under IAS 19"Employee Benefits (Revised)". This calculation uses the weighted averagenumber of shares in issue during the period. Diluted earnings per share are calculated based on profit for thefinancial period attributable to equity holders of the parent. Dilutedadjusted earnings per share are calculated based on profit for the financialperiod attributable to equity holders of the parent before exceptional itemsand the impact of net finance costs under IAS 19 "Employee Benefits(Revised)". In each case the weighted average number of shares is adjusted toreflect the dilutive potential of the awards expected to be vested on the LongTerm Incentive Schemes. Earnings per share for the period ended 30 June 2012 has beenrestated to reflect the impact on profit of changes in the calculation ofpension costs in accordance with IAS19 "Employee Benefits (Revised)" asexplained in note 1. The following reflects the income and share data used in the basic,adjusted, diluted and diluted adjusted earnings per share calculations: Net profit attributable to equity holders 30 June 30 June 2013 2012 (restated) £000 £000 Net profitattributable to equityholders 3,279 6,526Exceptional items 1,425 1,684Adjustments to netfinancingcosts 258 199 ------ ------Total adjusted anddiluted profitattributable to equityholders 4,962 8,409 ------- -------Weighted average number of shares 2013 2012 thousands thousands Shares in issue 95,903 95,903Weighted average number of treasury shares (593) (700) ------- -------Weighted average number of shares for basic andadjusted earnings per share (excluding treasuryshares) 95,310 95,203Effect of dilution of the Long Term Incentive Plan 536 609 ------- ------- 95,846 95,812 ------- ------- 6. Earnings per share (continued) Earnings per share 2013 2012 (restated) Basic 3.44p 6.85p ------- ------- Diluted 3.42p 6.81p ------- ------- Adjusted 5.21p 8.83p ------- ------- Diluted adjusted 5.18p 8.78p ------- ------- 7. Property, plant and equipment During the period the Group spent £1,009,000 (2012: £1,271,000) oncapital additions. 8. Financial liabilities 30 30 31 June June December 2013 2012 2012 £000 £000 £000CurrentCurrent instalments due on bank loans 4,063 3,985 3,852Current instalment due on contingent 325 541consideration 440 Non-currentNon-current instalments due on bank loans 55,208 60,622 56,500Non-current instalment due on contingent 1,135 2,345consideration 2,448 ------ ------ ------ 60,731 67,493 63,240 ------ ------ ------ The bank loans at 30 June 2013 are stated net of deferred financingcosts amounting to £842,000 (30 June 2012: £1,042,000; 31 December 2012:£939,000). The Group's bank facilities comprise a £65m Revolving CreditFacility and a €25m Term Loan Facility which mature in May 2017. The Term LoanFacility has bi-annual repayments of €2.5m in June and December of each year. 9. Derivatives and other financial instruments The Group's principal financial instruments comprise bank loans andcash and short-term deposits. The main purpose of these financial instrumentsis to raise finance for the Group's operations. The Group has various otherfinancial assets and liabilities, such as trade receivables and tradepayables, which arise directly from its operations. Set out below is a comparison by category of carrying amounts andfair values of the Group's financial assets and liabilities, excluding tradereceivables and payables, that are carried in the financial statements. Carrying Fair amount value 30 June 30 June 2013 2013 £000 £000Financial assetsCash and short term deposits 9,066 9,066 ------ ------Financial liabilitiesInterest-bearing loans and borrowings 59,271 59,271Contingent consideration 1,460 1,460 ------ ------ 60,731 60,731 ------ ------ The fair value of contingent consideration, which arose on theacquisition of Simply Zesty Limited in March 2012, is measured using thepresent value of the probability-weighted average of pay out associated witheach possible outcome of EBITDA achieved under the related earn out agreement. The Group uses the following hierarchy as set out in IFRS 7"Financial Instruments: Disclosures" and IFRS 13 "Fair Value measurement" fordetermining and disclosing the fair value of financial instruments byvaluation technique: - Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities; - Level 2: other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly; and, - Level 3: techniques which use inputs which have a significant effect on the recorded fair value that are not based on observable market data. The fair value of contingent consideration is considered by theDirectors to fall within the level 3 fair value hierarchy. There have been notransfers between level 1, 2 or 3 of the hierarchy during the current andprevious years. In January 2013 the Group entered into an agreement with a previouscorporate shareholder of Simply Zesty Limited to pay cash consideration of£200,000 in settlement of their rights in relation to contingent considerationwith an estimated fair value of £1,031,000. At this stage the Group alsoannounced the merger of its two digital marketing agencies Simply Zesty andTibus Digital. The resultant restructuring coupled with finance costs of£25,000 due to unwind of the discounts and foreign exchange losses of£116,000, have led to a further reduction in the fair value of the contingentconsideration amounting to £397,000 from 31 December 2012. As part of a restructuring in the Group, subsequent to 30 June 2013the outstanding contingent consideration was settled with consequent fullrelease. 10. Pension schemes The IAS 19 deficit at 30 June 2013 is £6,041,000 (30 June 2012:£11,170,000) compared with a deficit of £12,409,000 at 31 December 2012. Thedecrease is predominately due to a strong return on equities resulting in anincrease in the scheme's assets and a discretionary employer contribution of£1,209,000. 11. Related party transactions The nature of related parties disclosed in the consolidated financialstatements for the Group as at and for the year ended 31 December 2012 has notchanged. There have been no significant related party transactions in the sixmonth period ended 30 June 2013. Risks and uncertainties The 2012 Annual Report sets out the most significant risk factorsrelating to UTV Media plc's operations in the Company's judgement at the timeof that report. The Company does not consider that these principal risks anduncertainties have changed. However additional risks and uncertainties notcurrently known to the Company or that the Company does not currently deemmaterial may also have an adverse effect on its business. With respect to the risks and uncertainties identified within theAnnual Report, the Chairman's statement highlights those risks anduncertainties that will have significant impact throughout 2013. Statement of directors' responsibilities The interim report is the responsibility of, and has been approvedby, the directors of UTV Media plc. Accordingly, the directors confirm that tothe best of their knowledge: - the condensed set of financial statements has been prepared in accordance with IAS 34 "Interim Financial Reporting" as adopted by the European Union; - the interim report includes a fair review of the information required by the Disclosure and Transparency Rules: - DTR 4.2.7R, being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements, and a description of the principal risks and uncertainties for the remaining six months of the year; and - DTR 4.2.8R, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the entity during that period, and any changes in the related party transactions described in the last annual report that could do so. By order of the Board: John McCann Group Chief Executive 27 August 2013 Independent review report to UTV Media plc Introduction We have been engaged by the Company to review the condensed set offinancial statements in the half-yearly financial report for the 6 monthsended 30 June 2013 which comprises the Group Income Statement, Group Statementof Comprehensive Income, Group Balance Sheet, Group Statement of Changes inEquity, Group Cash Flow Statement and the related notes 1 to 11. We have readthe other information contained in the half yearly financial report andconsidered whether it contains any apparent misstatements or materialinconsistencies with the information in the condensed set of financialstatements. This report is made solely to the company in accordance withguidance contained in ISRE 2410 (UK and Ireland) "Review of Interim FinancialInformation Performed by the Independent Auditor of the Entity" issued by theAuditing Practices Board. To the fullest extent permitted by law, we do notaccept or assume responsibility to anyone other than the company, for ourwork, for this report, or for the conclusions we have formed. Directors' Responsibilities The half-yearly financial report is the responsibility of, and hasbeen approved by, the directors. The directors are responsible for preparingthe half-yearly financial report in accordance with the Disclosure andTransparency Rules of the United Kingdom's Financial Conduct Authority. As disclosed in note 1, the annual financial statements of thegroup are prepared in accordance with IFRSs as adopted by the European Union.The condensed set of financial statements included in this half-yearlyfinancial report has been prepared in accordance with International AccountingStandard 34, "Interim Financial Reporting", as adopted by the European Union. Our Responsibility Our responsibility is to express to the Company a conclusion on thecondensed set of financial statements in the half-yearly financial reportbased on our review. Scope of Review We conducted our review in accordance with International Standardon Review Engagements (UK and Ireland) 2410, "Review of Interim FinancialInformation Performed by the Independent Auditor of the Entity" issued by theAuditing Practices Board for use in the United Kingdom. A review of interimfinancial information consists of making enquiries, primarily of personsresponsible for financial and accounting matters, and applying analytical andother review procedures. A review is substantially less in scope than an auditconducted in accordance with International Standards on Auditing (UK andIreland) and consequently does not enable us to obtain assurance that we wouldbecome aware of all significant matters that might be identified in an audit.Accordingly, we do not express an audit opinion. Conclusion Based on our review, nothing has come to our attention that causesus to believe that the condensed set of financial statements in thehalf-yearly financial report for the 6 months ended 30 June 2013 is notprepared, in all material respects, in accordance with InternationalAccounting Standard 34 as adopted by the European Union and the Disclosure andTransparency Rules of the United Kingdom's Financial Conduct Authority. Ernst & Young LLP Belfast

27 August 2013