This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of
("MediaZest", the "Company” or “Group"; AIM: MDZ)
Half-year Report
Unaudited Interim Results
for the six months ended
Financial Highlights H1 FY24 H1 FY23 £’000 £’000 Revenue 1,173 1,054 Gross Profit 701 599 Gross Margin 60% 57% EBITDA1 (28) (148) (Loss) after tax (141) (260) (Loss) per share (pence) (0.0092) (0.0186) Cash 14 10
1 EBITDA is defined as (Loss)/Profit before tax adding back Finance costs, depreciation and amortisation
Operational Highlights
-- Positive H1 FY24 performance driven by long-term project roll outs with key customers including Hyundai and Pets at Home -- Continued good visibility over recurring revenue streams which remained consistent during the Period -- Work completed on further Lululemon Athletica stores asMediaZest continues to work with them acrossEurope -- First LED videowall delivered for Arc’Teryx in its newCovent Garden flagship store
Post-period end & Outlook
-- Strong start to H2 FY24, with a series of new orders from a wide range of well-known brands -- New business wins include installations inthe Netherlands ,Germany andFrance , to be delivered in H2 FY24 and the pipeline of potential new project work inEurope continues to expand -- Follow-on contract to supply digital signage to a large global automotive client across several of its sites in an EU country announced inMay 2024 -- Strong long-term demand for audio-visual technology in MediaZest’s three core sectors (retail, automotive and corporate offices)
-- Positive Outlook – aiming to build on the progress in H1 and generate positive growth organically and targeting a return to profitability for the full financial year ending30 September 2024 , whilst continuing to evaluate suitable parties for a potential “Buy and build” acquisition
“We were delighted to announce a follow-on contract with a large global automotive client last month, which will provide additional revenues of around € 150,000 in the short to medium term and which will contribute to recurring revenue streams. Our project pipeline continues to grow and we expect further contract confirmations before the financial year end.”
Enquires
MediaZest Plc www.mediazest.comGeoff Robertson , Chief Executive Officer via Walbrook PRSP Angel Corporate Finance LLP (Nomad) Tel: +44 (0)20 3470 0470David Hignell /Adam Cowl Hybridan LLP (Corporate Broker) Tel: +44 (0)20 3764 2341Claire Noyce Walbrook PR (Media & Investor Relations) Tel: +44 (0)20 7933 8780 or mediazest@walbrookpr.comPaul McManus /Alice Woodings Mob: +44 (0)7980 541 893 / +44 (0)7407 804 654
About
CHAIRMAN’S STATEMENT
The Board presents the consolidated unaudited results for the six months ended
Overview
The Board pleased to deliver a much improved H1 FY24 performance. Whilst revenues improved by 11%, gross profits increased by 17% with a greater mix of more profitable recurring revenue projects compared to the prior year. EBITDA and pre-tax losses were significantly reduced, with a positive start to H2 FY24 and a strong pipeline for the rest of the year and beyond, we believe the outlook for
Operational Review
Positive H1 FY24 performance driven long term project roll outs with key customers
The Company’s long-term client base remains consistent and continues to generate new opportunities. During the Period, the Group provided digital signage solutions to another tranche of stores for long-standing client, Pets at Home, and continued to deliver new dealership experiences for Hyundai.
Other long-term clients such as
Post-period end, we announced an agreement to deliver more projects for a large global automotive client won which now includes providing solutions across three European territories with the potential to expand this agreement further. These projects are longer term, over a three-year period, and will contribute to our recurring revenues for future periods.
Financial Review
Year-on-year improvement in results
-- Revenue was £1,173,000, up 11% (H1 FY23: £1,054,000). -- Gross profit was up by 17% to £701,000 (H1 FY23: £599,000). -- Gross margin rose to 60% (H1 FY23: 57%) reflecting the improvement in business compared to the prior period and the Group’s drive to higher margin recurring revenue work. -- Administrative expenses before depreciation and amortisation were £803,000, an increase of 8% (H1 FY23: £747,000) due to inflationary pressures and increased marketing spend. -- EBITDA improved significantly to a loss of £28,000 (H1 FY23: loss of £148,000). -- Net loss after taxation was £141,000 (H1 FY23: loss of £260,000). -- The basic and fully diluted loss per share was0.0092 pence (H1 FY23: loss per share0.0186 pence ). -- Cash and cash equivalents at31 March 2024 were £14,000 (H1 FY23: £10,000).
The Period showed considerable improvement on the prior comparative period and also the second half of the previous financial year. EBITDA moved closer to profitability reflecting increasing levels of new business, as long-term work to deliver more recurring revenue contracts begins to take effect.
This trend is expected to continue and accelerate in the second half of the financial year with recent project wins and new business activity.
Margins continue to be robust with the mix of services offered and also reduced project revenues as a percentage of total revenue resulting in a greater percentage of gross profit coming from recurring revenue contracts, which typically have lower direct cost of sales.
The Board continues to keep a close eye on costs, however inflationary pressures and additional investment in the sales and marketing process have led to increases in costs during the Period, compared to the first six months of the prior year.
In
Outlook
Encouraging outlook for full year
The Board believes the outlook for the remainder of the financial year and beyond is very encouraging. Several large new projects have been won which will be delivered in the period. This is expected to be reflected in improving financial results in the second half of the financial year.
Recurring revenue streams have been robust and the Company continues to target the growth of these, in addition to new client wins.
At a strategic level, the Board believes adding scale to the current operational business via acquisition would unlock shareholder value. The Group continues to evaluate potential targets in the market that may be suitable, whilst remaining focussed on the opportunities provided by recent organic growth.
Whilst the three markets in which the Group primarily operates – Retail, Automotive and Corporate – are seeing strong long term demand, the Board remains mindful of macro-economic uncertainty but remains optimistic that current growth will continue. We continue to monitor and control the cost base carefully, whilst balancing the growth of the business and continuing to seek additional clients and projects. The Board remains confident in MediaZest’s ability to deliver year-on-year growth, alongside targeting a return to profitability, and continues to be positive about the Group's future potential.
Lance O’Neill
Chairman
Unaudited Interim Results for the six months ended
MediaZest’s interim results are set out below, with comparisons to the same period in the previous year, as well as to MediaZest’s audited results for the year ended
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE SIX MONTHS ENDED
Unaudited Unaudited Audited 6 months 6 months 12 months 31-Mar-24 31-Mar-23 30-Sep-23 Note £'000 £'000 £'000 Continuing Operations Revenue 1,173 1,054 2,335 Cost of sales (472) (455) (1,073) Gross profit 701 599 1,262 Administrative expenses before depreciation (803) (747) (1,487) and amortisation Exceptional items - - (97) EBITDA (28) (148) (322) Administrative expenses - depreciation and (38) (31) (67) amortisation Operating (loss)/profit (66) (179) (389) Finance costs (75) (81) (164) Profit / (Loss) before taxation (141) (260) (553) Taxation - - (Loss)/profit for the period and total comprehensive loss/income for the period (141) (260) (553) attributable to the owners of the parent (Loss)/profit per ordinary 0.1p share Basic 2 (0.0092) (0.0186) (0.0396) Diluted 2 (0.0092) (0.0186) (0.0396)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT
Unaudited Unaudited Audited 6 months 6 months 12 months 31-Mar-24 31-Mar-23 30-Sep-23 Note £'000 £'000 £'000 ASSETS Non-current assets Goodwill 2,772 2,772 2,772 Owned - Property plant and equipment 44 51 60 Right of Use - Property plant and equipment 15 60 37 Total non-current assets 2,831 2,883 2,869 Current assets Inventories 85 117 97 Trade and other receivables 551 301 406 Cash and cash equivalents 4 14 10 40 Total current assets 650 428 543 TOTAL ASSETS 3,481 3,311 3,412 EQUITY Shareholders' Equity Called up Share capital 3,686 3,656 3,656 Share premium account 5,334 5,244 5,244 Share options reserve 146 146 146 Retained earnings (8,500) (8,065) (8,358) TOTAL EQUITY 666 981 688 LIABILITIES Non-current liabilities Interest bearing loans and borrowings 7 70 195 Current liabilities Trade and other payables 1,284 991 1,308 Interest bearing loans and borrowings 1,524 1,269 1,221 Total current liabilities 2,808 2,260 2,529 TOTAL LIABILITIES 2,815 2,330 2,724 TOTAL EQUITY AND LIABILITIES 3,481 3,311 3,412
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHS ENDED
Share Share Share Options Retained Total Capital Premium Reserve Earnings Equity £'000 £'000 £'000 £'000 £'000 Balance at 30 September 2022 3,656 5,244 146 (7,805) 1,241 Loss for the period - - - (260) (260) Total comprehensive loss for the - - - (260) (260) period Balance at 31 March 2023 3,656 5,244 146 (8,065) 981 Loss for the period - - - (293) (293) Total comprehensive loss for the - - - (293) (293) period Balance at 30 September 2023 3,656 5,244 146 (8,358) 688 Profit for the period - - - (141) (141) Total comprehensive loss for the - - - (141) (141) period Issue of new shares 30 90 - - 120 Balance at 31 March 2024 3,686 5,334 146 (8,500) 667
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE SIX MONTHS ENDED
Unaudited Unaudited Audited 6 months 6 months 12 months 31-Mar-24 31-Mar-23 30-Sep-23 Note £'000 £'000 £'000 Cash flows from operating activities Cash generated from/(absorbed by) operations 3 (185) 119 162 Taxation - 0 0 Net cash generated by/(used in) operating (185) 119 162 activities Cash flows used in investing activities Purchase of property, plant and equipment - (25) (47) Sale of tangible fixed assets - - 16 Net cash used in investing activities - (25) (31) Cash flows from financing activities Other loans repayments (5) (4) 30 Shareholder loan receipts 66 88 131 Bounce back loan (repayments)/receipts (5) (5) (10) Invoice financing (repayments)/receipts 91 (168) (154) Payment of lease liabilities (33) (12) (50) Share issue proceeds 120 - - Interest paid (75) (28) (83) Net cash (used in) / generated from financing 159 (129) (136) activities (Decrease)/increase in cash and cash (26) (35) (5) equivalents Cash and cash equivalents at beginning of 40 45 45 period Cash and cash equivalents at end of the year 4 14 10 40
NOTES TO THE FINANCIAL INFORMATION
1. Basis of Preparation
The Group’s annual financial statements are prepared in accordance with
The International Accounting Standards are subject to amendment and interpretation by the
This interim report does not comply with IAS 34 “Interim Financial Reporting” as permissible under the AIM Rules for Companies.
Going Concern
The Directors have considered financial projections based upon known future invoicing, existing contracts, pipeline of new business and the number of opportunities it is currently working on. These projections reflect the improvement in business post period end, as noted in the review above, and the associated improvement in financial results and therefore cash generation in the second half of the financial year ended
In addition, these forecasts have been considered in the light of the ongoing challenges in the global economy as a result of inflationary pressures, the legacy of the Covid-19 pandemic, war in
These forecasts indicate that the Group will generate sufficient cash resources to meet its liabilities as they fall due over the next 12-month period from the date of this interim announcement.
As a result, the Directors consider that it is appropriate to draw up the financial information on a going concern basis.
Accordingly, no adjustments have been made to reflect any write downs or provisions that would be necessary should the Group prove not to be a going concern, including further provisions for impairment to goodwill and investments in Group companies.
The main operating business,
Non-statutory accounts
The financial information contained in this document does not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006 (“the Act”).
The statutory accounts for the year ended
The financial information for the six months to
1. Earnings per Share
Unaudited Unaudited Audited 6 months 6 months 12 months 31-Mar-24 31-Mar-23 30-Sep-23 (Loss)/profit after tax £000 (141) (260) (553) Weighted average numbers of shares 1,530,852,004 1,396,425,774 1,396,425,774 Basic earnings per share (pence) (0.0092) (0.0186) (0.0396) Diluted earnings per share (pence) (0.0092) (0.0186) (0.0396)
The diluted loss per share is identical to that used for basic loss per share as the options are "out of the money" and therefore anti-dilutive.
1. Cash from operating activities
Unaudited Unaudited Audited 6 months 6 months 12 months 31-Mar-24 31-Mar-23 30-Sep-23 £'000 £'000 £'000 (Loss)/profit after tax (141) (260) (553) Depreciation/amortisation charge 38 31 67 Profit on disposal of fixed assets - - (16) Finance Costs 75 81 164 Decrease/(increase) in inventories 12 4 24 (Decrease)/increase in payables (24) (110) 268 Decrease/(increase) in receivables (145) 373 208 Cash from operating activities (185) 119 162
4. Cash and cash equivalents
Unaudited Unaudited Audited 6 months 6 months 12 months 31-Mar-24 31-Mar-23 30-Sep-23 £'000 £'000 £'000 Cash in hand 14 10 40
5. Subsequent events
There were no significant subsequent events.
6. Distribution of the interim report
Copies of the interim report will be available to the public from the Company’s website, www.mediazest.com, and from the Company Secretary at the Company's registered address at Unit 9,