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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Mbl Group Plc | LSE:MUBL | London | Ordinary Share | GB00B0W48T45 | ORD 7.5P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 3.50 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Apr 2019 to Apr 2024
TIDMMUBL
RNS Number : 5825A
MBL Group PLC
12 September 2018
12 September 2018
The information communicated in this announcement contains inside information for the purposes of Article 7 of Regulation 596/2014.
MBL GROUP PLC
("MBL" or the "Company" or the "Group")
Final Results for the Year Ended 31 March 2018
MBL Group plc (AIM: MUBL) announces its final audited results for the year ended 31 March 2018.
Key points:
-- Group revenue including discontinued operations decreased by 17.2% to GBP13.2 million (2017: GBP16.0 million);
-- The Garden and Home division operating profit before exceptional items increased by over 51%, this division is included in discontinued operations
-- Home Entertainment division operating loss before exceptional items of GBP46,000 (2017: GBP383,000 profit), this division is included in discontinued operations and was treated as 'held for sale' as at 31 March 2018.
-- Group loss for the year after taxation was GBP1,499,000 (2017: GBP158,000) including exceptional costs of GBP1,086,000 in the year (2017: GBP693,000)
-- Net cash of GBP0.4 million (2017: GBP1.6 million), the Group remains debt free -- Group diluted loss per share of 8.7p (2016: 0.9p) -- No dividend is proposed
-- The Garden and Home division was sold in March 2018 for GBP0.8 million in cash, all consideration received by 31 August 2018.
-- The Home Entertainment division entered administration, after the year end, on 15 June 2018
-- The Company became a Rule 15 Cash Shell under Rule 15 of the AIM Rules for Companies from 15 June 2018.
-- The accounts have been prepared on a non-going concern basis, as the Directors do not expect the Group to continue trading within the next twelve months
Extracts from the final results appear below. The Annual Report & Accounts will be available on the Company's website, www.mblgroup.co.uk, from later on today and will be sent to shareholders shortly thereafter, together with the Notice convening the Annual General Meeting.
For further information please contact:
MBL Group plc Tel: 01454 777 831
Anton Lane, Chairman
SPARK Advisory Partners Limited Tel: 0203 368 3555
Mark Brady
SI Capital Limited Tel: 01483 413500
Nick Emerson
CHAIRMAN'S STATEMENT
The Group's objectives were to pursue the conclusions of the strategic review and dispose of the trading businesses. A sale of Redworth Limited was achieved in March 2018, with the final deferred payment being received post year end on 31 August 2018. However, increased problematic trading conditions for the Group's other trading division resulted in Windsong International Limited being place into administration post year end.
The Group faced a decline in sales during the year. The decline is attributable to several issues, both operationally and within the market.
It is the Chairman's view that the Garden & Home business, whilst remaining relatively stable, was affected by competition within the market and disruption to the operation of the business. In particular, the development of the business was affected by not identifying replacement management following their termination in 2016. Following the sale of Redworth Limited, and its subsidiary The Garden and Home Trading Company Limited, the companies and their underlying businesses are treated as a discontinued operation.
In line with our stated strategy, the Company had been looking to dispose of the Home Entertainment division for some time as part of a plan to realise value for shareholders and return capital to them in the short to medium term. Whilst this strategy was still being implemented, it became clear to the Board that this process would take longer than first envisaged because of market demand. In addition, post period end, a worsening of trading in this division in the weeks leading up to 15 June 2018 meant that the Company would have needed to inject further capital into the Home Entertainment division. Having taken insolvency and legal advice, the Board decided that it was in the best interests of all shareholders to appoint administrators to Windsong in order to preserve the Company's cash reserves and not erode them further. The company and its underlying business has been treated as a discontinued operation and the assets and liabilities at 31 March 2018 have been classified as 'held for sale'.
The Group's subsidiaries have further incurred several exceptional expenses affecting profitability including the settlement of an unfair dismissal claim. The Group has also incurred the costs of undertaking two investigations at the requests of certain shareholders. The second of these investigations remains in progress at the year end.
The Board is seeking to engage with shareholders regarding the commerciality of ongoing investigations and the future of the company with the hope of returning shareholder value. The Board sought direction from the shareholders on 5 September 2018 whether they desired the Company's shares to remain admitted to trading on AIM. Shareholders voted in favour of remaining on AIM and as such the Board intends to seek Shareholder direction to establish the desired future of the Company.
Operational Review
Sales within the home entertainment market declined by 23.6%, in a very challenging market.
Home Entertainment
Hot Features
Premium
2018 GBP'000 2017
GBP'000
--------------------------------- ------------- ---------
Revenue 7,259 9,500
================================= ============= =========
Operating (loss)/ profit before
exceptional costs (46) 383
--------------------------------- ------------- ---------
Our Home Entertainment division experienced a downturn during the year with a decrease in revenue of 23.6% to GBP7.3 million (2017: GBP9.5 million). Exports account for 68% of the division's sales (2017: 64%). In the previous year sales had been stimulated with the continued growth of the vinyl market and back catalogue sales in the audio market driven by the death of high profile artists which revived interest in their music. Gross profit margins dropped marginally to 10.7% from 12.9% due mainly to worsening trading conditions and stock management. Profitability declined compared with the prior year at GBP46,000 loss (2017: GBP383,000 profit), a 112% reduction.
Exceptional costs of GBP58,000 were incurred, being a GBP35,000 loyalty bonus and one-off IT infrastructure costs of GBP23,000.
The division has been treated as a discontinued operation.
Garden & Home
2018 2017 GBP'000
GBP'000
------------------------------------- --------- -------------
Revenue 5,925 6,414
===================================== ========= =============
Operating profit before exceptional
costs 373 247
------------------------------------- --------- -------------
The Garden & Home division specialised in the mail order and online sales of garden bird food and associated wildlife products and aquatics supplies. The division is a discontinued operation.
Sales during the year decreased by 7.6% to GBP5.9 million (2017: GBP6.4 million). The decline related to increased competition in the market place entwined with the change of senior management. There has also been a continued focus on controlling costs and this has led to an operating profit for the business of GBP373,000 (2017: GBP247,000), an increase of over 51%. The UK market for bird food remains highly competitive but the ability to buy competitively helped maintain margins within the division.
Exceptional costs of GBP316,000 were met by Redworth Limited which related to an employment dispute and the associated legal and professional fees.
The division is a discontinued operation.
STRATEGIC REPORT
Financial Review
The Segmental Analysis in the Notes to the Financial Statements presents the Group's performance and position by division.
The Group loss for the year after taxation was GBP1,499,000 (2017: GBP158,000) however it is worth noting that there were GBP712,000 of exceptional items in the year (2017: GBP693,000). In addition to this it also includes GBP467,000 of losses relating to discontinued operations compared to GBP745,000 of profit in the prior year.
The Group has sold off subsidiaries that contributed to its trading activity with the aim of realising value for shareholders. The decision to proceed with the sale process arose from a recognition that the Group's performance may be unduly affected by differing views and influences of shareholders. The previous boards considered the businesses would better perform after a sale and under new management although the sale process became prolonged. The current board continued the sale process.
The Group's business has significantly reduced and as such we are sensitive to the costs of maintaining an AIM listing. The Board are also conscious of providing shareholders with a return of capital and appreciate this could be affected by a number of issues including ongoing investigations and the cost of remaining on AIM. These factors were considered as part of the strategic review and were relevant in reaching the conclusion that the Group sell its trading businesses.
Cash flow, working capital and borrowing facilities
Despite a number of one-off exceptional costs incurred by the Group along with disposal of subsidiaries, it ended the year with cash balances of GBP0.4 million (2017: GBP1.6 million) and GBP0.8 million receivable following the disposal of subsidiaries. The net cash outflow from operating activities was GBP1.3 million (2017: GBP0.2 million). Exceptional items of GBP712,000 adversely affected the Group cash position, which includes a fine of GBP75,000 on 13 August 2018 for breaches of AIM regulations during September 2017. The Group remains debt free.
Dividends
The Board is not recommending the payment of a dividend.
Future Strategy
The Company became a Rule 15 Cash Shell under Rule 15 of the AIM Rules for Companies from 15 June 2018. Within six months of becoming an AIM Rule 15 cash shell, the Company must make an acquisition or acquisitions which constitute(s) a reverse takeover under Rule 14 of the AIM Rules for Companies. In the event that the Company does not complete a reverse takeover under AIM Rule 14 within six months of becoming a cash shell, the Exchange will suspend trading in the Company's ordinary shares pursuant to AIM Rule 40 on 17 December 2018.The Board intends to seek to guidance from shareholders on desired future Group activities and the return of capital to shareholders.
The Group currently has no trading activity since an Administrator was appointed to Windsong International Limited on 15 June 2018. As at the time of writing, there is one subsidiary remaining within MBL Group, being Air Music and Media Copyright Limited, generating GBP30,000 of residual revenue from digital catalogue sales within the year. This is also included in discontinued operations as the directors are currently looking at the best way to dispose of this in the interest of shareholders.
On 5 September 2018 there was a General Meeting for the Shareholders to vote on the cancellation of the Company's admission to trading on AIM. The Shareholders did not vote in favour of this resolution and accordingly the Group will continue to be admitted to trading on AIM and will continue to incur monthly management charges and the costs of maintaining the AIM quotation. In addition, the Group may incur ongoing legal costs associated with the ongoing investigation, any claims and managing shareholder communications.
Since the disposal of trading businesses, and given the decision to remain quoted on AIM, ongoing running costs, potential investigations and claims will erode residual cash balances within the foreseeable future.
The Directors have formed the judgement that the Group is not expected to continue trading within the next 12 months and have therefore rebutted the going concern basis in preparing these financial statements as disclosed in the accounting policies.
Board Changes
The Board has seen significant changes during the year with both T Jackson-Smith and P Palframan leaving the Board and Anton Lane and James Reynolds being appointed.
A D Lane
Chairman
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEARED 31 MARCH 2018
2018 2017
GBP'000 GBP'000
Continuing operations (restated)
Administrative expenses - normal (321) (220)
Administrative expenses - exceptional (712) (693)
Operating loss (1,033) (913)
Financial income 1 5
Financial expenses - 5
Net financing income 1 10
Loss before tax (1,032) (903)
Taxation - -
Loss from continued activities (1,032) (903)
(Loss)/profit from discontinued operations (467) 745
Total comprehensive expense for the
year (1,499) (158)
Basic and diluted loss per share in
pence (8.7) (0.9)
Basic and diluted loss per share in
pence (continuing) (6.0) (5.2)
Basic and diluted loss per share in
pence (discontinued) (2.7) 4.3
Continuing operations comprise the parent company only. All other activities of the group are included within discontinued operations. In accordance with IFRS 5, the comparative profit and loss account has been restated so that discontinued operations include those activities classified as discontinued in the current year.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2018
2018 2017
GBP'000 GBP'000
Non-current assets
Property, plant and equipment - 208
Intangible assets - 140
Deferred tax assets - 88
-------- --------
Total non-current assets - 436
Current assets
Inventories - 702
Trade and other receivables 847 1,682
Cash and cash equivalents 360 1,626
-------- --------
1,207 4,010
Assets held for disposal 1,596 -
Total current assets 2,803 4,010
Current liabilities
Trade and other payables (374) (1,261)
Tax payable - -
Provisions (472) (472)
-------- --------
(846) (1,733)
Liabilities held for disposal (743) -
Total current liabilities (1,589) (1,733)
Net current assets 1,214 2,277
Total assets less current liabilities 1,214 2,713
Equity
Share capital 1,297 1,297
Merger reserve - (2,800)
Retained earnings (83) 4,216
-------- --------
Total equity 1,214 2,713
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEARED 31 MARCH 2018
2018 2017
GBP'000 GBP'000
Cash flows from operating activities
Loss for the year (1,499) (158)
Adjustments for:
Depreciation 67 75
Loss on disposal of subsidiary 37 -
Financial income (1) (5)
Financial expense - (5)
Taxation 11 (40)
(1,385) (133)
Decrease/(increase) in inventories 319 (13)
(Increase)/decrease in trade and
other receivables 1,279 23
Increase/(decrease) in trade and
other payables (380) (95)
Increase in assets/liabilities held (853) -
for sale
Net cash outflow from operating activities (1,020) (218)
Cash flows from investing activities
Interest received 1 5
Acquisition of property, plant and
equipment (4) (21)
Cash leaving group on disposal of (243) -
subsidiaries
Net cash outflow from investing activities (246) (16)
Cash flows from financing activities
Interest refunded - 5
Net cash inflow from financing activities - 5
Net decrease in cash and cash equivalents (1,266) (229)
Cash and cash equivalents at 1 April 1,626 1,855
Cash and cash equivalents at 31 March 360 1,626
Notes to the Financial Statements for the year ended 31 March 2018
1. Source of Information
The preliminary financial statements for the financial year ended 31 March 2018 have been approved by the Board of Directors. The financial information set out above does not constitute the company's statutory accounts for the years ended 31 March 2018 or 2017 but is derived from those accounts. Statutory accounts for 2017 have been delivered to the registrar of companies, and those for 2018 will be delivered by 30 September 2018. The auditor, MHA Moore and Smalley, has reported on those accounts; their report for 2018 was unqualified and did not contain statements under section 498(2) or (3) of the Companies Act 2006 or equivalent preceding legislation.
2. Operating segments
The segments disclosed below reflect the Group's management and internal reporting structure.
Consolidated statement of comprehensive income for year ended 31 March 2018:
Home Entertainment Garden Group
and Home Other Total
GBP'000 GBP'000 GBP'000 GBP'000
(discontinued) (discontinued) (discontinued)
Gross revenue 7,259 5,925 30 13,214
Intersegment revenue - - - -
------------------- --------------- --------------- --------
Revenue 7,259 5,925 30 13,214
------------------- --------------- --------------- --------
Operating (loss)/profit before
exceptional and central costs (46) 373 51 378
Exceptional costs allocated
to segments (58) (316) - (374)
------------------- --------------- --------------- --------
(104) 57 51 4
Exceptional costs - Group (712)
Impairment of Home Entertainment (423)
Loss on disposal of Garden
and Home (37)
Central costs (321)
--------
Operating loss (1,489)
Net financing income 1
Taxation expense (discontinued) (11)
--------
Loss for the period (1,499)
--------
Home Entertainment Garden Other,
and Home incl. Group
GBP'000 GBP'000 GBP'000
Total assets and liabilities
Assets held for sale 1,591 - 5 1,596
Liabilities held for sale (743) - - (743)
Total assets (excluding held
for sale) - - 1,207 1,207
Total liabilities (excluding
held for sale) - - (846) (846)
------------------- --------------- --------------- --------
Total segment net assets 848 - 366 1,214
------------------- --------------- --------------- --------
Capital Expenditure
Tangible fixed assets 3 1 - 4
------------------- --------------- --------------- --------
Depreciation 11 11 45 67
------------------- --------------- --------------- --------
Consolidated statement of comprehensive income for year ended 31 March 2017:
Home Entertainment Garden Group
and Home Other Total
GBP'000 GBP'000 GBP'000 GBP'000
(discontinued) (discontinued) (discontinued)
Gross revenue 9,500 6,414 40 15,954
Intersegment revenue - - - -
------------------- --------------- --------------- --------
Revenue 9,500 6,414 40 15,954
------------------- --------------- --------------- --------
Operating profit before
exceptional and central costs 383 247 75 705
Exceptional costs (693)
Central costs (220)
--------
Operating loss (208)
Net financing income 10
Taxation expense 40
--------
Loss for the period (158)
--------
Home Entertainment Garden Other,
and Home incl. Group
GBP'000 GBP'000 GBP'000
Total assets and liabilities
Total assets 1,725 641 1,940 4,306
Goodwill - 140 - 140
Total liabilities (703) (387) (643) (1,733)
------------------- --------------- --------------- --------
Total segment net assets 1,022 394 1,297 2,713
------------------- --------------- --------------- --------
Capital Expenditure
Tangible fixed assets 1 13 7 21
------------------- --------------- --------------- --------
Depreciation 10 18 47 75
------------------- --------------- --------------- --------
3. (Loss)/profit per share
The calculation of basic (loss)/profit per share has been calculated on the (loss)/profit after tax of GBP1,499,000 (2016: GBP158,000) and the weighted average number of shares in issue during the year of 17,296,067 shares of 7.5p each (2016: 17,296,067 shares of 7.5p each).
The calculation of diluted (loss)/profit per share is identical to that used for the basic (loss)/profit per share.
The adjusted (loss)/profit per share, as disclosed below, was calculated using the (loss)/profit after tax for the financial year calculated with reference to the basic and diluted weighted average share in issue during the year.
2018 2017
GBP'000 GBP'000
Loss after taxation from continuing
operations (1,032) (903)
(Loss)/profit after taxation from
discontinued operations (467) 745
Total comprehensive expense for
the year (1,499) (158)
Basic and diluted loss per share
in pence (8.7) (0.9)
Basic and diluted loss per share in pence (continuing
operations) (6.0) (5.2)
Basic and diluted (loss)/profit per share in
pence (discontinued operation) (2.7) 4.3
4. Consolidated statement of changes in equity
Share Merger Retained Total
capital reserve earnings
GBP'000 GBP'000 GBP'000 GBP'000
At 1 April 2016 1,297 (2,800) 4,374 2,871
Total comprehensive expense
for the year - - (158) (158)
--------- --------- ---------- --------
At 31 March 2017 1,297 (2,800) 4,216 2,713
Total comprehensive expense
for the year - - (1,499) (1,499)
Transfers - 2,800 (2,800) -
--------- --------- ---------- --------
At 31 March 2018 1,297 - (83) 1,214
5. Annual Report
The Annual Report, together with the Notice of Annual General Meeting, will be posted to shareholders shortly. Copies of the Annual Report will be available on request from the MBL Group plc, Edge House, UB1 Vantage Office Park, Old Gloucester Road, Hambrook, Bristol, BS16 1RS and will also be available to download from the Company's website at www.mblgroup.co.uk.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
END
FR GGUQPBUPRGPP
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