Half Yearly Report

23 December 2013

MBL GROUP PLC

(AIM: MUBL)

("MBL" or "the Group")

Unaudited Interim Results for the Six Months Ended 30 September 2013

The Board of MBL Group plc announces its interim results for the six months ended 30 September 2013.

Key Points

Continued operations only:

· Group revenue £6.1m (2012: £5.9m)

· Group loss before tax of £0.3m (2012: loss £0.3m)

· Loss per share for the period of 1.4p (2012: 2.0p)

Including discontinued operations:

· Group revenue decreased to £6.1m (2012: £7.4m)

· Group loss before tax reduced to £0.6m (2012: £1.1m)

· Loss per share for the period of 3.2p (2012: loss 6.4p)

Balance sheet:

· The Group remains debt free with cash balances of £3.1m at 30 September 2013 (31 March 2013: £3.1m).

Peter Cowgill, Chairman of MBL, commented:

"The Group operates within the two distinct sectors of home entertainment and garden and home products. The entry in 2012 to the garden and leisure sector has removed the Group's previous sole reliance on the home entertainment sector and the Board continues to look for opportunities to further strengthen the Group's prospects for the future.

The performance in the first half of the year remained in line with management's expectations and the second half has continued in the same manner."

--ENDS-

Enquiries:

MBL Group plc Tel: 0161 767 1620

Peter Cowgill, Non-Executive Chairman

N+1 Singer, Nominated Advisor and Broker Tel: 020 74960 3000

Aubrey Powell

Alex Wright

Chairman's Statement

The Group has continued with its planned diversification and a summary of the Group performance is shown in the table below:

CONTINUING OPERATIONS

Home Entertainment

At the start of the financial year the Group's home entertainment wholesale activities, which had previously traded as MBL Direct, were consolidated into Windsong International ("Windsong").

During the period the Group's home entertainment sales fell by £304k to £4,421k (2012: £4,725k) as sales from MBL Direct's customer base reduced. In the prior year MBL Direct had been utilised as a vehicle to clear surplus stock. This activity ceased during the last financial year and as a consequence whilst sales value has fallen, gross margins have improved. An operating profit of £41k has been generated during the period (2012: loss £173k).

Garden and Leisure

The Group invested heavily in both the Garden Bird Supplies and Garden Centre Online brands which were acquired in May 2012. In particular, marketing activity increased for both brands and has included national advertising campaigns, attendance at specialist shows and the launch of Garden Centre Online's first catalogue. The marketing investment has been directed to increase the profile of the brands and attract new customers.

The combined businesses generated sales of £1,656k (2012: £1,098k) and, due to the increased marketing activity, an operating loss of £177k (2012: loss £67k).

Overheads

Overhead costs have continued to be managed in line with the size of the business and Group headcount is now 47 employees (2012: 89; year end 2013: 53). Management has continued negotiations with regards to the Leyland property, the size of which exceeds the needs of the remaining business, and it is anticipated that the Garden and Leisure businesses and central resource will relocate to premises appropriate to the size of anticipated volumes in 2014.

DISCONTINUED OPERATIONS

In line with the Group's partial exit from the home entertainment market, a number of subsidiaries have been wound down, discontinued or disposed of in previous financial years. Included within the discontinued operations expenses are accruals for residual costs for winding up the discontinued activities.

For the purposes of the Interim Announcement these businesses have been classified as discontinued. As a consequence, only the reported loss after tax of discontinued operations is disclosed within the Interim Announcement.

Funding position

The working capital of the Group remained tightly controlled during the period. At 30 September 2013, the Group had positive cash balances of £3.1m (31 March 2013: £3.1m) and remained without bank loan or overdraft facilities.

The Group continues to face the challenge of a lack of available supplier credit, particularly in the home entertainment sector, but the director's believe that the Group remains in a strong position to fund its existing operations for the foreseeable future.

Group Strategy and Outlook

The Group operates within the two distinct sectors of home entertainment and garden and home products. The entry in 2012 to the garden and leisure sector has removed the Group's previous sole reliance on the home entertainment sector and the Board continues to look for opportunities to further strengthen the Group's prospects for the future.

The performance in the first half of the year remained in line with management's expectations and the second half has continued in the same manner.

Peter Cowgill

Chairman

23 December 2013 

Condensed Consolidated Statement of Total Comprehensive Income

For the period ended 30 September 2013

Condensed Consolidated Statement of Financial Position

As at 30 September 2013

Unaudited Condensed Consolidated Statement of Changes in Equity

For the period ended 30 September 2013

Consolidated Statement of Cash Flows

For the period ended 30 September 2013

Notes

1. Basis of preparation

MBL Group Plc (the 'Company') is a company incorporated and domiciled in the United Kingdom. The half-year financial report for the 6 month period to 30 September 2013 represents that of the Company and its subsidiaries (together referred to as the 'Group').

This half-year financial report is an interim management report as required by Rule 18 of the AIM Rules for Companies and was authorised for issue by the Board of Directors on 23 December 2013.

The half-year financial report is prepared in accordance with the EU endorsed standard IAS 34 'Interim Financial Reporting'. The comparative figures for the year ended 31 March 2013 are not the Group's statutory accounts for that financial year. Those accounts have been reported on by the Group's Auditor and delivered to the Registrar of Companies. The Report of the Auditor was (i) unqualified, (ii) did not include a reference to any matters to which the Auditor drew attention by way of emphasis without qualifying their report, and (iii) did not contain a statement under section 498 of the Companies Act 2006.

The information contained in the half-year financial report for the 6 month period to 30 September 2013 and 30 September 2012 is unaudited and should be read in conjunction with the annual financial statements for the year ended 31 March 2013, which have been prepared in accordance with the IFRS adopted by the European Union.

As required by AIM Rule 18, the half-year financial report has been prepared and presented in a form consistent with that which will be adopted in the preparation of the Company's annual report and accounts for the year ended 31 March 2014.

The Group's policy is to maintain the ability to continue as a going concern, in order to provide returns to the shareholder and benefits to other stakeholders. Accordingly the going concern basis has been adopted in preparing these interim results.

The consolidated financial statements of the Group for the year ended 31 March 2013 are available upon request from the Company's registered office at MBL Group plc, Unit 9 Enterprise Court, Lancashire Enterprise Business Park, Centurion Way, Leyland, Lancashire, PR26 6TZ.

2. Going concern

The financial report has been prepared on a going concern basis, which the Directors believe to be appropriate for the following reasons.

The Directors have prepared cash flow forecasts to 31 March 2015 taking account of reasonable possible changes in trading performance. These forecasts show the Group to be cash positive throughout the next 15 months and make a number of assumptions around revenue and profitability of the remaining business activity.

These forecasts demonstrate the Group has appropriate funds which the directors believe are sufficient for the Group to continue to trade for at least the next 12 month period. In addition the Group continues to reflect an overall net assets position and is debt free.

The Group had a cash balance of £3.1m as at 30 September 2013 and currently does not have a bank overdraft or loan facilities.

The directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. Thus they continue to adopt the going concern basis in preparing the financial report.

3. Unaudited segmental analysis

The Group comprises the following main business segments:

Home Entertainment The sale of home entertainment products predominantly to the export market.

Garden and Leisure The sale of garden bird and garden leisure related products direct to consumer via mail order and online channels.

Other A combination of revenue streams including the license of film and music rights for manufacture, sale and download.

Discontinued The distribution, merchandising and retail of home entertainment products to general retailers and the sale of home entertainment products to the end consumer via the internet and retail stores.

Consolidated statement of comprehensive income for period ended 30 September 2013:

Consolidated statement of comprehensive income for period ended 30 September 2012:

Consolidated statement of comprehensive income for year ended 31 March 2013:

4. Taxation

The income tax charge has been estimated by the Group based on adjustments to tax payable in respect of previous years and the level of losses incurred in the period ending 30 September 2013.

5. Earnings per share

The calculation of the basic earnings per share is based on the loss after taxation divided by the weighted average number of shares in issue, being 17,296,068 (2012: 17,296,068; year ended 31 March 2013: 17,296,068).

6. Property, plant and equipment

During the period, the Group acquired assets with a cost of £96k (2012: £180k; year ended 31 March 2013: £318k).

Assets with a net book value of £2k were disposed by the Group (2012: £17k; year ended 31 March 2013: £42k), resulting in a net profit of £nil (2012: loss of £1k; year ended 31 March 2013: loss of £9k).

7. Provisions

8. Discontinued operations