Replacement Interim Results

The following announcement replaces the announcement released at 07.00 on 18 November 2013 under RNS number 2188T, the third bullet point of section 1 having been amended for clarification.

DQ Entertainment (DQE) a leading global animation, gaming, live action, entertainment production and distribution company, today announces its results for the period ended 30 September 2013

1. Financial Highlights:

· Revenue: INR 870 mn (USD 14.77 mn) (2012: INR.954 mn)(USD 17.39mn)

· EBIDTA: INR 561 mn (USD 9.53 mn)(2012: INR 348 mn)(USD 6.34 mn)

· Profit before tax: INR 296 mn(USD 5.03 mn) (2012: INR 99 mn)(USD 1.8 mn)

· Profit after tax: INR 287 mn (USD 4.87 mn) (2012: INR 71 mn)(USD 1.29 mn)

· With the first signs of improvement in the global scenario your Company has buoyantly sustained itself and generated a total revenue of Rs. 870 mn during the half year ended September 2013 which is on line with our annual estimates.

· The financials had a positive impact of change due to foreign exchange rates and substantial increase in production/delivery efficiencies. For the half year ended September 2013 there is a foreign exchange gain of Rs. 315 mn as compared to a loss of Rs. 17 mn for the corresponding period in the previous year. This gain is on account of restatement of foreign currency balances as on 30 September 2013.

· The Company continues to make significant efforts to reduce its receivables to a normal cycle. Since April 2013, the Company has already collected Rs. 866 mn . We are constantly in touch with all the clients/partners/broadcasters/distributors/agents for recovery of due amounts and monies are being received from most of the clients on regular basis, thereby assuring that the clients are committed to pay. We do not foresee any issues on the recoverability of these amounts. However, our administrative costs have been impacted by a provision of INR 57mn (with a corresponding reduction in receivables) which is due from one customer, although we are hopeful of recovering this debt.

During the half year ended, the Company has repayed term loans to the extent of INR155 mn

2. Chairman's Statement:

The global entertainment industry is developing at an unprecented pace. Mobility and portability of content will, in my opinion, have a profound impact as viewers consume programming outside their homes and want to control what they watch, when they watch, and on what device . So many opportunities are evolving and we recognize that in so far as content production is important, even more vital will be the distribution technologies that are emerging.

Recognizing and serving this need with regards to distribution technology, we have made substantial and focused progress in Licensing and Distribution of our Intellectual Properties not only for television broadcast, but other VOD (Video on Demand) and SVOD (Subscription Video on Demand) & OTT (Over the Top) platforms as well. Our flagship global property Jungle Book Series is on Netflix, Vudu and Hulu - the famous OTT platforms in the USA.

New associations with leading networks and licensees globally are paving the way to monetize our IPs and co-produced content. New deals across our portfolio of properties in recent months are with best-in-class partners such as France Television, Nickelodeon, Disney Channel Productions, Sky Italia, Universal Music, Discovery Kids, Rai TV, Italy etc. The promotional deal for The Jungle Book with Burger King Worldwide has been immensely successful and will be extended for second promotion.

We have successfully completed deliveries while new productions are in development. Our foray into theatrical production of 'The Jungle Book' is gathering momentum, and we hope to conclude announceable distribution deals in the near future.

 Recently, the Group concluded co-production and licensing deals worth INR 2220 mn. We remain confident that the global entertainment industry has excellent growth prospects, while our business remains well placed for projected growth in the current year."

3. Operating Highlights:

Completed projects:

1. Peter Pan Season 1 - 26 x 22' 3D HD Stereoscopic TV Series with ZDF Germany, De Agostini Italy, Method Animation supported by France TV, B Channel - Indonesia, JCCTV - Middle East and Noga - Israel

On- going projects :

1. Jungle Book Season 2 - 52 x 11'CGI TV series with ZDF - Germany and TF1 - France

2. Jungle Book Christmas Special - 42' CGI TV Feature, ZDF and Disney Channel

3. Robin Hood, Mischief in Sherwood - 52 x 11' CGI TV series with Method Animation and TF1 - France, ZDF - Germany, ATV - Turkey, DeA Kids - Italy

4. Lassie & Friends - 52 x 11' 2D HD TV series with Dreamworks Classic Media - USA, Super Prod & TF1 - France, ZDF - Germany

5. Lanfeust Quest - 26 x 22' CGI TV series with Gaumont Animation - France, M6 TV - France

6. NFL Rush Zone Season 3 - 24 x 22' CGI & 2D TV Series with Rollman Entertainment - USA for Nicktoons

7. Little Prince Season 3 - 26 x 22' CGI TV series with Method Animation, WDR - Germany, France Television, RAI TV - Italy

8. Iesodo - 10 x 13' CGI TV Series with Zaya Toonz LLC - USA

9. Manav - 1 x 60' 2D TV feature for Disney - India

New projects signed/in development:

1. Peter Pan Season 2 - 26 x 22' CGI TV series with ZDF - Germany, De Agostini - Italy and Method Animation - France and France TV

2. *Yonaguni  - 52 x 11' CGI TV series with Sea World - USA and Rollman Entertainment- USA

3. *7 Dwarfs & Me - 52 x 11' CGI & Live Action Hybrid Series with Method Animation - France

4. 5 & IT - 52 x 11' - CGI TV Series with ZDF Enterprises - Germany, Method Animation - France, Nick- India and Global TV - Indonesia

5. Leo & The Pisa Gang - 52 x 11' - CGI TV series with MPP Production and Penta TV - Germany

6. Raz & Benny - 52 x 11' - CGI TV series with Foothill Entertainment - USA

7. The Wind in the Willows - 52 x 11' HD TV series under development

* Have been signed/in development since the Indian subsidiary Q1 announcement on 9 August 2013

Licensing and Distribution:

Our licensing and distribution efforts have proven increasingly successful on a global scale and are helping to create long term and sustained value for DQE.

Broadcasting deals signed during the period:

Merchandising deals signed during the period: The Jungle Book

Merchandising Deals signed - The New Adventures of Peter Pan 

* Have been signed/in development since the Indian subsidiary Q1 announcement on 9 August 2013

4. Awards and Accolades

Mr. Tapaas Chakravarti received the Life Time Achievement - Hall of Fame Award on November 3, 2013 at the World Animation and VFX summit held in California. The accolade was awarded to Tapaas for his contribution to the growth of the animation industry in India and his global outreach efforts in animation.

***

Condensed Consolidated Interim Financial Statements

DQ Entertainment plc

30 September 2013

Condensed Consolidated Income Statement

Condensed Consolidated Statement of Comprehensive Income

Total comprehensive income attributable to:

Condensed Consolidated Statement of Financial Position

Condensed Consolidated Statement of Financial Position

 (continued)

These financial statements were approved by the Board of Directors and authorised for use on 15November 2013.

Signed on behalf of the Board of Directors by:

Director Director

Condensed Consolidated Statement of Changes in Equity for the period ended 30 September 2013

Condensed Consolidated Statement of Cash Flows for the period ended 30 September 2013

Condensed Consolidated Statement of Cash Flows for the period ended 30 September, 2013 (continued)

Notes to Condensed Consolidated Financial Statements

NOTE A - BASIS OF PREPARATION

1. General information

DQ Entertainment plc (the 'Company' or "DQ plc") is a company domiciled and incorporated in the Isle of Man on 19 April 2007 and was admitted to the Alternative Investment Market of London Stock Exchange on 18 December 2007. The Company raised approximately INR 2,147Mn at listing (before Admission costs).

The condensed consolidated financial statements of the Company for the six months period ended 30 September 2013, comprises the financial Information of the Company, its subsidiaries and associate (together referred to as the 'Group').

As at 30 September 2013 the following companies formed part of the Group:

The Company's registered address is 33-27, Athol Street, Douglas, IM ILB, Isle of Man.

The Group is primarily engaged in the business of providing traditional and digital animation for television, home video and feature films. The Group also is engaged in exploitation of its distribution rights to broadcasters, television channels, home video distributors and others.

The functional currencies of the respective Group companies are:

NOTE B - STANDARDS AND INTERPRETATIONS NOT YET APPLIED

The following new Standards and Interpretations, which are yet to become mandatory, have not been applied in the Company's Financial Statements.

Based on the Company's current business model and accounting policies, management does not expect any material impact on the Company's financial statements when any of the other standards or interpretations becomes effective.

The Company does not intend to apply any of these pronouncements early.

1. Significant accounting policies

The condensed consolidated interim financial information should be read in conjunction with the annual financial statements for the year ended 31 March, 2013, which have been prepared in accordance with International Financial Reporting Standards ('IFRS's)

In the opinion of management, all adjustments, which are of a normal recurring nature and necessary for a fair presentation, have been included. The Company has chosen to present the condensed consolidated financial position & condensed consolidated income statement, condensed consolidated comprehensive income statement, condensed consolidated statement of cash flows and condensed consolidated statement of changes in equity along with selected explanatory notes. Accordingly, certain information and note disclosures normally included in annual financial statements prepared in accordance with IFRS have been condensed or omitted, although the Company believes that the disclosures made are adequate to make the information presented not misleading. These condensedconsolidated financial statements have been prepared using the same accounting policies that were applied in the preparation of the Company's annual consolidated financial statements for the year ended 31 March, 2013.

The directors have had regard to the 12 month period from the date of approval of the interim financial statements and have reviewed the forecasted cash flows. The Company has sufficient resources to meet its on-going liabilities as they fall due.

NOTE C - SEGMENT REPORTING

Segment information is presented in respect of the Group's business and geographical segments. The primary format, business segments, is based on the Group's management and internal reporting structure.

Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated items comprise mainly interest-bearing loans, borrowings and expenses, and corporate assets and expenses.

Segment capital expenditure is the total cost incurred during the period to acquire segment assets that are expected to be used for more than one period.

Business segments

The Company comprises the following main business segments:

Animation production:

The production services rendered to production houses and training rendered for acquiring skills for production services in relation to the production of animated television series and movies.

Distribution:

The revenue generated from the exploitation of the distribution rights of animated television series.

The following is an analysis of the Company's revenue and results by operating segment for the periods under review:

NOTE D - CASH AND CASH EQUIVALENTS

NOTE E - INTANGIBLE ASSETS

NOTE F - INTANGBILE ASSETS UNDER CONSTRUCTION

Intangible assets under construction include amounts paid to the producers for acquisition of the distribution rights and amounts incurred on internally generated intellectual property rights pending for capitalisation. These advances are transferred to distribution rights on completion of the entire production activities and when the asset is ready for exploitation.

NOTE G - INTEREST BEARING LOANS AND BORROWINGS

Interest bearing loans and borrowings comprise the following:

NOTE H - PROVISION FOR RETAKES

Retakes include creative changes to the final product delivered to the customer, performed on the specific request of the customer at the Group's own cost. Requests for retakes will be accepted from customers by the Group for a maximum period of three months from the final delivery and hence the provision is not discounted.

NOTE I - PERSONNEL COSTS

Details of personnel expenses included in cost of sales, administrative and distribution expenses

are as follows:

NOTE J - NET FINANCING COSTS

NOTE K - EARNINGS PER SHARE ("EPS")

Profit attributable to ordinary shareholders

The Group does not have any dilutive instruments for any of the periods ended 30 September 2013 or

30 September 2012 and for the year ended 31 March, 2013 and as such Diluted EPS equals Basic EPS.

NOTE L - NON - CONTROLLING INTERESTS

NOTE M - EQUITY

a) Ordinary shares

DQ plc presently has only one class of ordinary shares. For all matters submitted to vote in the shareholders' meeting, every holder of ordinary shares, as reflected in the records of the Company on the date of the shareholders' meeting, has one vote in respect of each share held. All shares are equally eligible to receive dividends and the repayment of capital in the event of liquidation of the Company.

The Company has an authorized share capital of 60,000,000 equity shares of 0.1 pence each.

Issue of ordinary shares

NOTE M - EQUITY (Continued)

Share premium - The amount received by the company over and above the par value of shares issued is shown under this heading.

The share premium reserve can be utilised by the Company for the declaration of bonus shares and for offsetting incremental costs directly attributable to the issues of new shares.

 b) Reserves

Translation reserve - Assets, liabilities, income, expenses and cash flows are translated into Indian Rupees (presentation currency) from US Dollars (functional currency of DQ Mauritius),

 Euros (functional currency of DQ Ireland and DQ Films Ltd) and Great British Pounds (functional currency of DQ Plc). The exchange difference arising out of the period-end translation is debited or credited to foreign currency translation reserve.

 The movements in this reserve which are attributable to the controlling interests are set out below:

Exchange differences relating to the translation of the net assets of the Group's foreign operations from

their functional currencies to the Group's presentation currency (i.e. INR) are recognised directly in

other comprehensive income and accumulated in the foreign currency translation reserve.

Accumulated earnings - Accumulated earnings include all current and prior period results as disclosed in the income statement which are attributable to the controlling interests. The movements in the accumulated earnings are set out below:

Other Reserves - The Reverse Acquisition Reserve, Equity component of convertible instruments and

Capital Redemption Reserve are non distributable in nature.

NOTE N - CAPITAL COMMITMENTS AND CONTINGENT LIABILITIES

NOTE O - RELATED PARTIES

Identity of related parties

DQ plc has a related party relationship with its directors, executive officers, subsidiaries and associate.

DQ plc does not have any ultimate controlling entity.

Related parties and their relationships

a) Subsidiaries

DQ Entertainment (Mauritius) Limited

DQ Entertainment (International) Limited

DQ Entertainment (Ireland) Limited

DQ Entertainment (International) Films Limited

DQ Power Kidz Private Limited

Associate

Method Animation

RELATED PARTIES -

b) Key management personnel

Mr. Tapaas Chakravarti - Director

Mr. K. Balasubrahmanyam - Director

Ms. Theresa Plummer - Director

Ms.Rashida Adenwala - Director

c) Relatives of Key Management Personnel with whom DQ India had transactions during the year - Mrs. Rashmi Chakravarti (wife of Mr. Tapaas Chakravarti)

d) Ms Nivedita Chakravarti (daughter of Mr.Tapaas Chakravarti)

e) Mr Hatim Adenwala - Senior Vice President Human Resources (Husband of Rashida Adenwala)

RELATED PARTIES (Continued)

Trading transactions

Transactions between the Company and its subsidiaries, which are related parties of the Company, have been eliminated on consolidation and are not disclosed in this note. Details of transactions between the Group and other related parties are disclosed below.

Revenue from production from related parties was at prices arising out of the Group's usual trade practices. The amounts outstanding are unsecured and will be settled in cash. No guarantees have been given or received. No expense has been recognised in the period for bad or doubtful debts in respect of the amounts owed by related parties.

Compensation of key management personnel

Directors of the company and their immediate relatives control 14.47 per cent of the voting shares of the company.

The remuneration of directors and other members of key management during the period were as follows:

Other related party transactions

Remuneration paid to relatives of key management personnel during the period was INR 4 Mn

30 September 2012: 4 Mn; 31 March 2013: INR 8 Mn)

Contact: