Preliminary Results

8th Jun 2009 07:00



Preliminary Results for the year ended 31 March 2009

UBC produces strong profits and record cash balance.

Financial Highlights

Strategic Highlights

Chief Executive, Simon Cole, commented,

"This has been a year in which we have totally re-positioned the business, eliminating our exposure to the falling advertising market and fully providing for any risk in our digital investments. In doing so we have realised substantial value for our commercial networking business and expect to earn more in the current year from the well-structured deal with Global Traffic Network. We emerge with a slimmed down but focused radio services business and a balance sheet unrivalled in the industry."

Enquiries:

Simon Cole, Chief Executive, UBC Media Group plc Tel: 020 7453 1600

Mark Percy, Seymour Pierce Tel: 020 7107 8000

*'Recurrent' revenues are defined as those from clients from whom revenues have been generated for more than 12 months or with whom revenues are contracted for at least 12 months in the future.

Chief Executive's Review

Overview

We unveil here a set of results which show the fruits of a busy year of corporate activity and a robust underlying business. Against the background of an uncertain economic climate, we have reshaped our business, lowering our reliance on the volatile advertising market and removing completely our exposure to loss-making digital activities. Our core remaining businesses have substantial levels of recurring revenues, a customer base of large global companies with a high percentage of public funding and good forward visibility. At the same time, we have brought £9m of cash into the business through a disposal and created the possibility of making a return to shareholders.

We are now very well positioned to make carefully considered acquisitions at a good time in the economic cycle and build a strong company which services the global media industry with content and software.

Commercial (Discontinued)

Our results from continuing operations have excluded the Commercial Division which was sold to Global Traffic Network Inc. ("GTN"), a US listed company, in March for a cash consideration of £9m plus a three year earn-out. Turnover for the 11 months leading up to disposal was £9,417,000 (2008: 12 months - £11,534,000).

UBC had built its Commercial Division carefully over the last ten years to become the clear market leader in the provision of national advertiser-funded programming to commercial radio. Our dominance, particularly in the provision of traffic and travel news, was strengthened in November 2008 when we added Global Radio's stations - including Capital FM and Classic FM - to our network. This meant that our services were heard throughout the UK on virtually every major commercial radio station. It was this dominant position, despite the challenged national radio advertising market which has seen industry revenues in this area decline by more than 20% year on year, that led GTN to purchase the division from us for £9m initial consideration with future consideration contingent on revenue targets being met. 

We protected our position in a recovering economic climate by securing a three year revenue linked earn-out. The arrangement pays out each calendar year based on turnover targets and we are pleased that, in the four months to the end of April 2009, the revenues are at a level which, if continued, management believes will trigger a payment. Negotiations have commenced with GTN already on an arrangement to settle the earn-out with a one off cash payment to UBC. These negotiations also include the return to UBC of the part of the commercial business responsible for sponsorship, promotions and marketing activity, including the fast developing area of internet video marketing. This part of the business made a gross profit of £139,000 in the 11 months to February 2009 before the disposal.

Programme Production 

Our production division encompasses our two individual production units, Unique, based in London and Smooth Operations, based in Manchester and Cambridge. Turnover for the year was £2,946,000 (2008: £3,302,000).

These companies supply audio, video and multimedia content to a variety of clients. The businesses have traditionally been led by their position as significant suppliers to BBC Audio and Music - between them supplying 800 hours of programming - but have in recent years been expanding from that base to supply a broader range of clients and to produce an increasing amount of multimedia content. In the last twelve months, Smooth Operations produced two documentary series for Guardian Media Group's commercial radio stations and Unique supplied entertainment news to some 150 commercial stations. Online work has included video campaigns for Nivea and Braun and the production of podcasts for, amongst others, The Times.

Our work for the BBC includes Radio 4's 'Something Understood', which Unique has produced for 8 years and was this year commissioned for a further 3 years, Mark Radcliffe and Stuart Maconie's nightly programme on BBC Radio 2 and the Rock Show on BBC 6 Music. Two of our programmes, Count Arthur Strong (BBC R4) and Mark Radcliffe, were given Gold awards in this year's Sony Radio Academy Awards. 

We believe that the BBC's attitude to its suppliers is now more benign and that the Corporation will come under increasing pressure in the next twelve months to show commitment to the independent sector as it seeks to justify its position as the sole recipient of public funding in an increasingly diverse media marketplace. 

Data and Interactive

Since its inception in 2001, Unique Interactive has developed a global position in the provision of software and data services to the radio industry. It is a market leader in the UK and an increasingly significant supplier in the US where digital radio has been slower to develop than in Europe. Turnover was £579,000 (2008: £690,000)

The last twelve months have been concentrated on consolidating the company's customer base whilst the global radio industry has been going through a major period of adjustment owing in part to the difficult economic climate. Despite the many challenges faced by its customers, Unique Interactive has managed to maintain sales at close to last year's level and has won significant new business from the BBC - for whom it now supplies Electronic Programme Guide ("EPG") data for the iPlayer - and from the commercial radio industry in the USA who, via the National Association of Broadcasters, have commissioned Unique Interactive to develop an EPG system for the nascent US terrestrial digital radio industry.

One of the company's biggest clients, XM Satellite Radio of the USA, went through a prolonged merger in the last year with rival Sirius Satellite Radio. This caused a 6 month hiatus in work from the company - putting pressure on revenues. However, the resulting consolidated company has now emerged and has confirmed Unique Interactive as a supplier and recently begun discussions about further software development.

Chairman's Statement

My first report to shareholders is in respect of a year in which the world has experienced one of the most extraordinary financial crises in a century, the consequences of which are still extremely uncertain as to breadth, depth and length of economic decline and pace of subsequent recovery. It is therefore encouraging that, despite such turmoil and future economic and political uncertainty, your Company has been able to deliver strong profits due to the profound changes to the Group anticipated at the time of last year's report and concluded the year with record cash balances of £10.47m (2008: £3.92m). This positions the Group well for the future.

I am pleased to report that in the year to 31 March 2009 UBC performed relatively well delivering a post tax profit of £5.82m (2008: £3.39m loss) after provision in full for all loss making digital radio activities, the disposal of the Commercial Networking Division and consequent restructuring costs. 

Following the disposal of the Commercial Networking Division on 2 March 2009 which contributed eleven months of revenues in the period, being £9.42m (2008: £11.53m), the Group's continuing operating divisions remain Programme Production and Data and Interactive. In the year to 31 March 2009 Programme Production revenues were £2.95m (2008: £3.30m) and Data and Interactive Revenues were £0.58m (2008: £0.69m). With the well publicised challenges affecting the sector, and particularly the withdrawal of Channel 4 from its commitments to radio, this was a resilient operating performance by the continuing divisions.

Completing the sale of the Commercial Networking Division during a period of such uncertainty was very pleasing. The structure of the deal through the earn-out mechanics enables the Company to share in any future economic recovery of such a good business. This is thanks to the ingenuity and tenacity of the executive team although with the continuing deterioration in the markets during the year our preferred timetable was unavoidably extended.

Whilst endeavouring to maintain and improve operational performance the Board's primary focus following completion of the sale is on determining the most appropriate strategy for the Group to exploit its particular resources, skills and relationships to maximise shareholder value. Whilst considering additional investment in developing specific areas of the core businesses the Board, not surprisingly at this stage in the economic cycle, is also carefully exploring a number of potential acquisitions. The details of the Group's approach will be shared with shareholders imminently. Naturally the Board's deliberations on whether to return cash to shareholders and if so how much and through which route will be impacted by the Group's decisions in these areas and ability to successfully conclude any preferred transactions. Nonetheless the Company is seeking authority for a capital re-organisation to enable distributions to be made in the future without impediment. 

Both the production businesses, Unique and Smooth Operations, are within the top five suppliers of programming to the BBC. Unique Interactive is a market leader in the UK and other countries in key services and software to the digital radio industry. Accordingly, with the commitment by various European countries to roll out DAB, anticipated regulatory changes within the UK commissioning structure, increasing requirement for audio content on the web, and growth of internet radio, particularly in North America, it is expected that there will in time be meaningful opportunities organically to broaden and grow revenues of the Group's retained businesses. However, in the current climate anticipating with any precision the speed or scale that such opportunities will translate into revenues is extremely difficult.

It is traditional in a Chairman's Statement to report the Board's thanks to all staff. After such a transformational and significant year, which has been achieved in such a rapidly changing and uncertain climate, it is particularly important to recognise and appreciate the superb efforts of all management and staff (some of whom have left with, or as a result of, the sale of the Commercial division) for their professionalism, hard work, commitment and sheer tenacity during what has been a very unsettling period. There have been a number of Board changes during the year and on behalf of the Board I would like to thank John Hodson, John Quinn, Gavin Rigby and Simon Howell, for their significant contribution to the Group over the years.

Financial Review

For the financial year ended 31 March 2009 UBC Media Group plc is required to report its results under International Financial Reporting Standards ("IFRS"). The results reported in this announcement have been prepared in accordance with the recognition and measurement bases of IFRS.

In the year to 31 March 2009 Group revenues from continuing operations declined by 11.7% to £3.53 million (2008: £3.99 million). 

Revenues by division for the period were as follows:

Programme Production: £2.95 million (2008: £3.30 million) -10.8%

Data and Interactive: £0.58 million (2008: £0.69 million) -16.0%

Financial Summary (Year ended 31 March)

	2009		2008
	£000		£000
Continuing Operations
Revenues	3,525		3,992
Gross profit	1,894		2,344
Administrative expenses	(2,720)		(2,648)
Loss from continuing operations	(826)		(304)
Share of joint venture results	-		(446)
Interest received	121		252
Profit/(loss) from discontinued operations	6,583		(2,742)
Tax	(57)		(149)
Profit/(loss) in the period from continuing and discontinued operations	5,821		(3,389)

Net profit/(loss) attributable to discontinued operations	2009 £’000		2008 £’000
Commercial Division	9,148		1,015
Cliq music downloading service	(2,023)		(3,351)
Classic Gold Digital	(542)		(385)
Oneword Radio	-		(21)
Profit/(loss) from discontinued operations	6,583		(2,742)

 

Disposal of Commercial Division

On 2 March 2009 the Commercial Networking business was sold to Global Traffic Network (UK) Limited for an initial consideration of £9.0m and a potential earn out over the next three calendar years. The structure of the deal was such that the entire share capital of The Unique Broadcasting Company Limited was purchased by Global Traffic Network (UK) Limited after the assets of Programme Production and Data and Interactive businesses were transferred out of the company to another wholly owned subsidiary of UBC Media Group plc. The sale resulted in a gain on disposal of £9.0m (including a fair value of the earn out as at the balance sheet date). This has been accounted for in discontinued operations along with the trade performance of the division in the year. 

Closure of Cliq

On 11 June 2008 the directors decided to close the Cliq music downloading service. Consumer uptake was not as anticipated and the Java application was beset with difficulties relating to compatibility with mobile phones in the market place. Further costly development of the Java application was required and along with not having the co-operation of the mobile telecoms industry, the directors decided to close the consumer facing side of the Cliq music downloading service and instead concentrate on opportunities to provide a business-to-business solution to manufacturers of connected devices. After accounting for all closure costs of the division the loss attributed to Cliq in the year was £2.0m (including provision of digital licence costs) (2008: £3.4m) which was accounted for as a discontinued operation.

Classic Gold Digital

All digital licence costs have now been fully provided for in the year.

Investment in 4 Digital Group

UBC is a shareholder in the 4 Digital Group consortium, which in July 2007 was awarded the second national DAB multiplex. As a result of Channel 4's announcement to retreat from digital radio in October 2008 the shareholders of the 4 Digital Group agreed to put the company into a members' voluntary liquidation. UBC's investment of £150,000 has been fully written down in the year. 

Cash Flow

In the year to 31 March 2009 UBC had a cash inflow of £6.55 million (2008: £1.82 million inflow) including a cash outflow of £0.45 million from continuing operating activities (2008: £0.69 million outflow).

Cash

At 31 March 2009, UBC had cash in the bank of £10.47 million (2008: £3.92 million).

Loss per Share

In the year to 31 March 2009 UBC reported basic loss per share of -0.40p (2008: -0.34p) from continuing operations and basic profit per share of 3.02p (2008: 1.76p loss) from continuing and discontinued operations. The diluted loss per share was -0.38p (2008: -0.32p) from continuing operations and a profit per share of 2.89p (2008: -1.67p loss) from continuing and discontinued operations.

Dividend

The Board is not recommending the payment of a dividend (2008: £nil), though the company is in the process of a capital restructuring to enable distributions to be considered in the future.

  

Financial Statements

Consolidated Income Statement

		2009		2008
		£’000		£’000
Continuing operations
Revenue		3,525		3,992
Cost of sales		(1,631)		(1,648)
Gross profit		1,894		2,344
Administrative expenses before impairment of fixed asset investment		(2,570)		(2,648)
Impairment of fixed asset investment		(150)		-
Total administrative expenses		(2,720)		(2,648)
Operating loss		(826)		(304)
Investment income		121		252
Share of results of joint ventures		-		(446)
Loss before tax		(705)		(498)
Taxation on continuing operations		(57)		(149)
Loss for the period from continuing operations		(762)		(647)
Discontinued operations:
Profit/(Loss) for the period after taxation from discontinued operations		6,583		(2,742)
Profit/(Loss) for the period		5,821		(3,389)
(Loss)/Profit per share (pence)
From continuing operations
Basic		(0.40)		(0.34)
Diluted		(0.38)		(0.34)
From continuing and discontinued operations
Basic		3.02		(1.76)
Diluted		2.89		(1.76)

Financial Statements (continued)

Consolidated Balance Sheet

		2009 £’000		2008 £’000
Assets
Non-current assets
Goodwill		2,834		2,834
Property, plant and equipment		128		219
Deferred tax asset		92		-
Investments		-		150
		3,054		3,203
Current assets
Inventory: work in progress		94		58
Trade and other receivables		1,670		3,550
Derivative financial asset		811		-
Cash and cash equivalents		10,473		3,919
		13,048		7,527
Total assets		16,102		10,730
Current liabilities
Trade and other payables		(1,666)		(2,718)
Provisions for liabilities and charges – current		(931)		-
		(2,597)		(2,718)
Net current assets		10,451		4,809
Non-current liabilities
Deferred tax liability		(447)		(298)
Provisions for liabilities and charges – non-current		(2,919)		(3,396)
		(3,366)		(3,694)
Total liabilities		(5,963)		(6,412)
Net assets		10,139		4,318
Equity
Share capital		1,927		1,927
Share premium account		18,676		18,676
Other reserves		-		(801)
Accumulated losses		(10,464)		(15,484)
Total equity		10,139		4,318

Financial Statements (continued)

Consolidated Cashflow Statement

			2009 £’000		2008 £’000
Cash flows from operating activities
Cash used in continuing operations			(446)		(693)
Cash used in discontinued operations			(1,421)		(326)
Taxation rebate			123		15
Net cash used in operating activities			(1,744)		(1,004)
Investing activities
Interest received			121		222
Proceeds from disposal of trade and assets of subsidiary			8,212		3,832
Other investment income			-		30
Investment in joint venture			-		(466)
Purchase of property, plant and equipment			(35)		(84)
Purchase of investment			-		(150)
Investment in intangible assets			-		(557)
Net cash from investing activities			8,298		2,827
Net increase in cash and cash equivalents			6,554		1,823
Cash and cash equivalents at beginning of period			3,919		1,933
Cash acquired on purchase of subsidiary			-		163
Cash and cash equivalent at end of period			10,473		3,919

  Financial Statements (continued)

1  Basis of preparation

The preliminary results for the year ended 31 March 2009 are an abridged statement of the full annual report, which was approved by the Board of directors on 5 June 2009. The auditors' report on these accounts was unqualified and did not contain statements under section 237(2) or 237(3) of the Companies Act 1985. The preliminary results do not comprise statutory accounts within the meaning of section 240 of the Companies Act 1985. The annual report for the year ended 31 March 2009 will be dispatched to shareholders by 26 June 2009 for approval at the Annual General Meeting on 24 July 2009.

The preliminary results are prepared in accordance with International Financial Reporting Standards ('IFRS') as issued by the International Accounting Standards Board. The preliminary results are also prepared in accordance with IFRS adopted by the European Union ('EU'), the Companies Act 1985 and Article 4 of the EU IAS Regulations. However, the financial information included in this preliminary announcement does not itself contain sufficient information to comply with IFRS. The Company will publish full financial statements that comply with IFRS in June 2009.

The preparation of the preliminary results requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the balance sheet date, and the reported amounts of revenue and expenses during the reporting period. Actual results could vary from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods.

2 Business and geographical segments

Business segments

For management purposes, the Group is organised into two continuing operating divisions - Programme Production and Data and Interactive. These divisions are the basis on which the Group reports its primary segment information.

Principal activities are as follows:

Programme Production - The principal activity of the division is the production and syndication of radio programmes and promotions to the BBC and to the domestic and international radio markets. 

Data and Interactive - The principal activity of the division is the development and sale of software and data services to the radio industry both in the UK and overseas markets. 

The Group was also previously involved in:

Commercial Networking - the sale of radio advertising airtime within the UK. This division was discontinued with effect from 2 March 2009 (see note 3) and the results for the year have been presented in discontinued operations.

Cliq - The creation of a digital music downloading service. On 10 June 2008 the Board took the decision to close the loss-making mobile phone version of its Cliq music downloading service and concentrate on providing a business-to-business solution to manufacturers of connected devices. The results for the year have been presented in discontinued operations (see note 3).

Segment information about these businesses is presented below:

2009	Programme Production £’000		Data and interactive £’000		Elimination £’000		Consolidated £’000
Revenue
Total revenue	3,100		659		(234)		3,525
Inter-segment revenue	(154)		(80)		234		-
External revenue	2,946		579		-		3,525

Inter-segment revenue is charged at prevailing market prices.

Result
Segment result	501		48		-		549
Unallocated corporate expense	-		-		-		(1,375)
Operating loss	-		-		-		(826)
Investment income	-		-		-		121
Loss before tax	-		-		-		(705)
Taxation on continuing operations	-		-		-		(57)
Profit for the period from discontinued operations (note 10)	-		-		-		6,583
Profit after tax and discontinued operations	-		-		-		5,821

 

2. Business and geographical segments (continued)

Other information

2009	Programme Production £’000		Data and interactive £’000		Unallocated £’000		Consolidated £’000
Capital additions	16		8		12		36
Depreciation	19		15		71		105
Balance
Assets
Segment assets	3,527		246		11,518		15,291
Discontinued operations	-		-		-		811
Consolidated total assets	--		--		-		16,102
Liabilities
Segment liabilities	143		150		1,373		1,666
Discontinued operations	-		-		-		4,297
Consolidated total liabilities	-		-		-		5,963
2008	Programme Production £’000		Data and interactive £’000		Elimination £’000		Consolidated £’000
Revenue
Total revenue	3,433		778		(219)		3,992
Inter-segment revenue	(131)		(88)		219		-
External revenue	3,302		690		-		3,992

 

 

Inter-segment revenue is charged at prevailing market prices.

  2. Business and geographical segments (continued)

Result
Segment result	722		141		-		863
Unallocated corporate expense	-		-		-		(1,167)
Operating loss	-		-		-		(304)
Investment income	-		-		-		252
Share of results of joint ventures							(446)
Loss before tax	-		-		-		(498)
Taxation on continuing operations	-		-		-		(149)
Loss for the period from discontinued operations (note 10)	-		-		-		(2,742)
Loss after tax and discontinued operations	-		-		-		(3,389)

2008	Programme Production £’000		Data and interactive £’000		Unallocated £’000		Consolidated £’000
Capital additions	4		15		622		641
Depreciation	(11)		(26)		(93)		(130)
Impairment losses recognised in	-		(1)		(2,008)		(2,009)
Balance
Assets
Segment assets	3,713		253		4,406		8,372
Investment	-		-		-		150
Discontinued operations	-		-		-		2,208
Consolidated total assets	-		-		-		10,730
Liabilities
Segment liabilities	146		15		947		1,108
Discontinued operations							5,304
Consolidated total liabilities	-		-		-		6,412

 

3. Discontinued operations

Shown below is a summary of discontinued operations:

	Notes	2009 £’000		2008 £’000
Commercial Division	(i)	9,148		1,015
Cliq music downloading service	(ii)	(2,023)		(3,351)
Classic Gold Digital	(iii)	(542)		(385)
Oneword Radio	(iv)	-		(21)
Profit/(Loss) from discontinued operations		6,583		(2,742)

 

(i) On 2 March 2009 the entire share capital of The Unique Broadcasting Company Limited was purchased by Global Traffic Network (UK) Limited, a subsidiary of Global Traffic Network Inc, a US registrant. The assets of Programme Production and Data and Interactive businesses were not included in the sale and were transferred out of the company to New Unique Broadcasting Company Limited a newly incorporated and wholly owned subsidiary of UBC Media group plc. The sale was for an initial cash consideration of £9,000,000 and contingent consideration based on revenue achieved by the Commercial division in the years ending December 2009, 2010 and 2011 which is discussed in further detail in note 28. This results in a gain on disposal of £9,023,000 as shown below. The net assets of the disposal amounted to £3,000 and direct disposal costs amounted to £785,000. Included within discontinued operations is also the trade performance of the disposed assets which amounted to a profit of £125,000 in the year (2008: £1,015,000).

		2009 £’000		2008 £’000
Revenue		9,417		11,534
Expenses		(9,292)		(10,519)
Profit before tax		125		1,015
Attributable tax expense		-		-
Profit after tax		125		1,015
Gain on disposal of continued operations		9,023		-
Profit attributable to discontinued operations		9,148		1,015
		2009 £’000		2008 £’000
Initial consideration (cash)		9,000		-
Fair value of contingent consideration		811		-
Cost of disposal		(785)		-
Net assets disposed		(3)		-
Gain on disposal		9,023		-

 

 

3. Discontinued operations (continued)

 (ii) On 11 June 2008 the directors decided to close the Cliq music downloading service. Consumer uptake was not as anticipated and the Java application was beset with difficulties relating to compatibility with mobile phones in the market place. Further costly development of the Java application was required and along with not having the co-operation of the mobile telecoms industry, the directors decided to close the consumer facing side of the Cliq music downloading service and instead concentrate on providing a business-to-business solution to manufacturers of connected devices. After accounting for all closure costs of the division the loss attributed to Cliq in the year was £2,023,000 (2008: £3,351,000).

		2009 £’000		2008 £’000
Revenue		-		11
Expenses		(1,172)		(1,271)
Impairment of intangible assets		-		(1,994)
Loss before tax		(1,172)		(3,254)
Attributable tax credit		64		59
Loss after tax		(1,108)		(3,195)
Licence costs		(915)		(156)
Loss attributable to discontinued operations		(2,023)		(3,351)

The licence cost in the current year is for a provision for the ongoing commitment attributable to non-cancellable licences which run to 2015.

(iii) In the prior year on 30 June 2007 the business and assets, including licences, of Classic Gold Digital Limited, were sold to GCap Media (AM) Limited, a wholly-owned subsidiary of GCap Media plc. On 30 June 2007 the 20% shareholding in Classic Gold Digital Limited held by GCap Media Services Limited (formerly GWR Radio Services Limited) was transferred to UBC Media Group plc and Classic Gold Digital Limited became a wholly-owned subsidiary of UBC Media Group plc and Classic Gold Digital Limited changed its name to Lisson Street (Properties) Limited.

The licence cost in the current year is for a provision for the ongoing commitment attributable to non-cancellable licences which run to 2015. These licences were used to broadcast the Classic Gold Digital service.

		2009 £’000		2008 £’000
Revenue		-		1,026
Expenses		-		(1,281)
Interest received		-		524
Profit before tax		-		269
Attributable tax expense		-		-
Profit after tax		-		269
Gain on disposal of discontinued operations		-		3,535
Licence costs		(542)		(3,665)
Inter-company charges		-		(524)
Loss attributable to discontinued operations		(542)		(385)

3. Discontinued operations (continued)

 (iv) In the prior year on 12 December 2007, the Group acquired all the shares in Oneword Radio Limited held by 4 Ventures Limited for a consideration of £1, bringing its shareholding to 100%. At this date, the Group acquired net liabilities of £812,000. On 11 January 2008 the Group made the decision to discontinue the Oneword Radio Limited operation. 

During the year the Group invested £Nil (2008: £466,000) in the Oneword Radio Limited joint venture. On 12 December 2007 a decision was taken to waive all loans owed by Oneword Radio Limited to The Unique Broadcasting Company Limited and to provide no further funding to Oneword Radio Limited.

		2009 £’000		2008 £’000
Revenue		-		-
Expenses		-		(22)
Gain on acquisition		-		1
Net loss attributable to discontinued operations		-		(21)

The effect of discontinued operations on segment results is disclosed in note 3.

4. Provisions

 

				Digital licences provision £’000		Total £’000
At 1 April 2008				3,396		3,396
Additional provision in the year				1,328		1,328
Utilisation of provision				(874)		(874)
At 31 March 2009				3,850		3,850
Included in current liabilities						931
Included in non-current liabilities						2,919
						3,850

The company has provided for the costs attributable to non-cancellable licences which run to 2015 on the basis of the discounted present value of future payments (2008: £3,396,000).

Management are in discussions with the holders of the licences and are confident that these amounts will be settled for less than the contracted amount but, because the outcome of these discussions is uncertain, management have provided based on their contractual obligations.

The provision is made subsequent to payments of £181,000 (2008: £158,000) made to MXR in the year. The CEO of UBC Media Group plc is also the Chairman of MXR. Dealings remain on an arms-length basis. 

All provisions relate to discontinued operations.

ENDFR UUUMPQUPBGQA

---

Related Shares:

7DIG.L