Unaudited Results for the year to 31 December 2013

Cellcast PLC

(the "Company" or the "Group")

Unaudited Preliminary Results for the year ended 31 December 2013

The Board of Cellcast PLC (AIM: CLTV) announces the Group's unaudited preliminary results for the year ended 31 December 2013.

Financial Results Highlights

· Operating Revenue 15.54 million (2012: £19.16 million)

· Operating loss of £2.48 million (2012: loss £0.51 million)

· Exceptional costs of £1.13 million (2012: £0.28 million)

· Loss for the year £2.49 million (2012: loss £0.06 million)

Post Balance Sheet Event

· Agreement signed with Entertainment Network Ltd resulting in one off payment of £2.98 million (approximately £2 million net)

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Andrew Wilson, CEO of Cellcast PLC, commented:

"The results for the year just ended have been disappointing with the reduction in revenues reflecting the general market decline in the premium rate service sector. Whilst the beneficial effects of the relocation to Milton Keynes and reorganisation were expected to be recognised in the second half of 2013, for various logistical reasons, these benefits will not now be fully realised until June 2014.

As the Group's traditional UK market offers diminishing opportunities for new customer acquisition the Group has identified two new areas of potential growth. The first, cross-selling and upselling complementary internet and mobile internet based services to the existing customer base and the second, expansion into developing markets where mobile and specifically smartphone penetration is growing rapidly and new digital broadcasting opportunities are emerging.

I am delighted to announce the agreement with Entertainment Network Ltd resulting in a one off net payment of approximately £2 million which was announced today."

 For further information:

Chief Executive's Statement

Unaudited 2013 Results

Operating revenues, which continued to be derived almost entirely from interactive broadcasting activities in the UK, amounted to £15.5 million, a decrease of 19% on 2012. The gross margin declined from a level of 6% in 2012 to a negative 1% in 2013. The Group posted an operating loss of £2,483,000 compared to the previous year's operating loss of £511,000. The 2013 operating loss includes £1,131,000 the majority of which was spent on unsuccessful exploratory ventures in overseas markets (2012: £276,000).

Revenues remained poor throughout the first half of 2013 and as anticipated continued to decline in the second half. Evidence suggests that this pressure was derived less from competitive share than from a continued recession driven shrinkage in customer demand for our services. Industry research shows that revenue across the premium rate service sector declined in 2013 and the group's diminution in revenue reflects this general market decline, a decline that continued despite the cessation of operation by a number of competitive channels.

General and administrative costs decreased by 18% from £1,019,000 to £838,000. Around 40% of these were personnel costs, with 18 permanent staff at 31 December 2013.

In October 2013 the Group successfully relocated its studios and associated production facilities from Central London to Milton Keynes. This is expected to result in operational savings of £150,000 per month when fully implemented. In addition, the set up in Milton Keynes allows flexible access to additional space on demand giving the group the ability to react quickly to opportunities to broadcast on new channels or in new markets. It was hoped that the beneficial effect of this relocation and reorganisation would be recognised in the second half of 2013 but for various logistical reasons these benefits will not be fully realised until June 2014.

Amortisation and depreciation expenses of £377,000 - 37% less than in 2013 - are predominantly accounted for by the amortisation of the group's capitalised development costs, which at 31 December 2013 net book value of £80,000 (2012 - £326,000).

After taking into account the net interest costs, the total loss for 2013 was £2,491,000 (2012 - loss of £55,000). 2013 loss per share was 3.3p (2012 loss per share of 0.1p).

Funding

At 31 December 2013, the Group had a net cash balance of £404,000 (2012: £740,000).

Your attention is drawn to note 1 "Basis of Preparation" and the statement that the directors anticipate that the auditor's report, to be issued with the Group's statutory accounts for the year ended 31 December 2013, will be unqualified but will contain an emphasis of matter paragraph. This emphasis of matter paragraph will draw attention to the material uncertainty which may cast significant doubt about the Group's ability to continue as a going concern.

Post Balance Sheet Event

Today, Cellcast is pleased to announce that Cellcast UK, its wholly owned subsidiary, has entered into an agreement with Entertainment Networks Ltd, a subsidiary of Sony Pictures Television, under which Cellcast UK has agreed to early termination of its exclusive rights (which it has held since 2006) to manage and operate the Freeview channel known as Movie Mix in consideration for a one off payment of £2,980,000.

Of the consideration receivable the directors believe that the net amount, after payment of certain liabilities in relation to the operation of the Movie Mix channel and professional fees, will be approximately £2 million.

This will provide the Company with a cash sum, which the directors expect to use to support the short working capital requirements of Cellcast PLC.

Outlook

As the Group's traditional UK market offers diminishing opportunities for new customer acquisition the Group has identified two areas of potential growth. The first of these involves increase revenue from existing customers through cross-selling and upselling complementary internet and mobile internet based services. The second is expansion into developing markets where mobile and specifically smartphone penetration is growing rapidly and new digital broadcasting opportunities are emerging. The fruits of these efforts were realised in the second half of 2013 and it is hoped these revenues will continue to grow through 2014.

Andrew Wilson

Chief Executive Officer

27 March 2014

Unaudited Consolidated Statement of Comprehensive Income

Unaudited Consolidated Statement of Financial Position

Unaudited Consolidated Statement of Changes in Equity for the Year Ended 31 December 2013

Unaudited Consolidated Statement of Changes in Equity for the Year Ended 31 December 2012

Unaudited Consolidated Statement Of Cash Flows For the year ended 31 December

Notes to the unaudited financial statements

1. Basis of preparation

The figures for the year ended 31 December 2013 have been extracted from the unaudited statutory financial statements for the year that have yet to be delivered to the Registrar of Companies and on which the auditor has yet to issue an opinion. The financial information attached has been prepared in accordance with the recognition and measurement requirements of international financial reporting standards (IFRS) as adopted by the EU and international financial reporting interpretations committee (IFRIC) interpretations issued and effective at the time of preparing those financial statements. The accounting policies applied in the year ended 31 December 2013 are consistent with those applied in the financial statements for the year ended 31 December 2012.

The financial information for the years ended 31 December 2013 and 31 December 2012 does not constitute statutory financial information as defined in Section 434 of the Companies Act 2006 and does not contain all of the information required to be disclosed in a full set of IFRS financial statements. This announcement was approved by the Board of Directors on 27 March 2014. The auditor's report on the financial statements for 31 December 2012 was unqualified, and did not contain a statement under either Section 498 (2) or 498 (3) of the Companies Act 2006 and included an emphasis of matter relating to the uncertainties in respect to the Group's ability to continue as a going concern. The financial statements for the year ended 31 December 2012 have been delivered to the Registrar.

Going concern

During the year ended 31 December 2013, the group recorded a loss of £2,490,950. While the group has net cash of £404,153 as at 31 December 2013 it has net current liabilities of £2,545,639. Subsequent to the year end the group sold its rights to Entertainment Networks Limited, a subsidiary of Sony Pictures Television for £2,980,000, generating additional cash for the group of £2,000,000. Furthermore, payments plans have been agreed with the group's main creditors.

The directors have carefully considered whether or not it is appropriate to adopt the going concern basis in preparing the 2013 financial statements. The directors have reviewed the group's detailed cash forecast to ensure that the group's current working capital and credit facilities in place are sufficient for the foreseeable future. This assumption is based upon updated forecasts required as a result of the reduction in the performance of the UK television business together with the continued reduction in operational costs implemented over the year and assumes the maintenance of existing relationships with key suppliers.

After making enquiries, the Directors have concluded that the group has adequate resources to continue trading for the foreseeable future. For these reasons, they continue to adopt the going concern basis of accounting in preparing the group financial statements.

The directors anticipate that the auditor's report, to be issued with the Group's statutory accounts for the year ended 31 December 2013, will be unqualified but will contain an emphasis of matter paragraph. This emphasis of matter paragraph will draw attention to the material uncertainty which may cast significant doubt about the Group's ability to continue as a going concern, referred to above.

The group's revenues are almost entirely in the UK from interactive broadcasting activities on Sky and Freeview channels. The financial information is presented to the executive management team who are responsible for making financial decisions as one operating unit which apart from the group's associate undertaking operates in one geographical unit. The executive management team make their decisions based upon this information. The executive management team comprises the chief executive officer, the chief operating officer and the chief financial officer.

The group has 3 significant telecom aggregators, generating 70% of the group's television and broadcast revenue. The 3 telecom aggregators contribute £5,923,117, £3,544,962, and £1,362,728 of the group's total revenue. (2012: 80% representing £9,249,341, £5,774,531 and £583,301).

3. Staff costs

Staff costs are included in general and administrative expenses (2013:£326,857, 2012: £338,343) and cost of sales (2013: £740,342, 2012: £847,012).

Average monthly number of employees by activity (including directors)

4. Loss per Share

The calculations of adjusted basic and diluted losses per ordinary share are based on the following results:

Due to the losses incurred in 2013 there was no dilution effect from the issued share options and warrants in 2013 or 2012.

The total potential number of dilutive ordinary shares at the year end was 12,783,699 (2012: 12,783,699).

5. Interest receivable and similar income

6. Interest payable and similar charges

7. Intangible assets

The decrease in the net book value of intangible assets in the year is predominantly due to the amortisation charge for the year of £310,516.

8. Property, plant & equipment

9. Trade and other receivables

10. Trade and other payables

11. Borrowings

12. Cash Flows Year ended 31 December

13. Capital commitments

At 31 December 2013, the group had no outstanding capital commitments (2012: nil).

14. Events after the reporting period

On 27 March 2013, the Company's wholly owned subsidiary Cellcast UK Limited ("Cellcast UK") entered into an agreement with Entertainment Network Ltd, a subsidiary of Sony Pictures Television, under which Cellcast UK agreed to early terminate its exclusive rights (which it has held since 2006) to manage and operate the Freeview channel known as Movie Mix in consideration for a one off payment of £2,980,000.