The company's new business pipeline is strong, with three major
client wins in its creative division including one which generates
over GBP500,000 in annualised billings. While trading has fallen
short of budget in Scotland and Ireland (two of its more recent
markets acquired via acquisition) management is supporting its
regional efforts and expects business to pick up in the second half
of the calendar year.
IBIS' valuation at the half-year has increased by GBP7,488 (+2%)
to reflect increased valuations from transactions and public
trading involving comparable companies.
Futurelex (formerly known as Polyview)
---------------------------------------------------
Date of initial 17 November 2008
investment:
---------------------- ---------------------------
Investment to date: GBP950,000 ordinary shares
and loan notes
---------------------- ---------------------------
Valuation as at GBP321,876
31 January 2013:
---------------------- ---------------------------
Investment in period: GBP0
---------------------- ---------------------------
Valuation as at GBP200,000
31 July 2013:
---------------------- ---------------------------
Change in valuation: -GBP121,876; -38%
---------------------- ---------------------------
Investment Overview
Futurelex, which was launched in 2006, provides both online and
offline information to the international legal market. The group
comprises The Global Legal Post, an online legal news digest, the
legal tendering platform ProcureLaw.com and the legal lead
generation business TakeLegalAdvice.com. The company also organises
events and conferences catering to the international legal
market.
Recent Developments
In April 2013, Futurelex sold its legal tendering platform,
ProcureLaw, to Elevate Technologies in the US for a mixture of cash
and a continued carried interest, the proceeds from which have been
used for the company's working capital.
The company hosted a "Luxury Law Summit" in May in partnership
with the International Herald Tribune aimed at the legal market for
luxury goods and services. Following the success of the inaugural
event held in London, Futurelex is now planning a series of UK and
international Luxury Law Summits for 2014 and is also looking to
launch events catering to other specialist areas within the legal
market in partnership with the International Herald Tribune.
While traffic to the company's legal news digest website, the
Global Legal Post, has been encouraging and has continued to grow
over the past six months, Futurelex has faced a challenging legal
market in which to monetise its digital assets.
In the financial year ending 31 January 2013, IBIS made a
significant write down in the carrying value of its investment in
Futurelex. During the period under review, IBIS has supported
Futurelex in its fundraising efforts by participating in the
company's restructuring, whereby IBIS has entered into an agreement
to sell part of its loan notes and convert the balance debt into
equity on the basis that IBIS shall own 25% of the company's
ordinary shares post-investment. The net result of the
restructuring has seen the value of IBIS' investment in Futurelex
decrease by GBP121,876 (-38%) and a GBP190,805 of accrued loan note
interest written off (which is accounted for separately in the
calculation of the Company's net asset value.)
Riva Digital Media
-----------------------------------------------------
Date of initial 03 May 2007
investment:
---------------------- -----------------------------
Investment to date: GBP345,015 ordinary shares
and GBP4,500 unsecured loan
note
---------------------- -----------------------------
Valuation as at GBP0
31 January 2012:
---------------------- -----------------------------
Investment in period: GBP0
---------------------- -----------------------------
Valuation as at GBP0
31 July 2012:
---------------------- -----------------------------
Change in valuation: GBP0; 0%
---------------------- -----------------------------
Investment Overview
Riva Digital Media's core activity is the design, production and
distribution of Epacs. Each Epac is a bundled collection of premium
content which is digitally wrapped in a unique branded skin and is
downloadable to a customer's personal computer. The components of
an Epac can include video clips, MP3 files, ring tones, digital
wall paper and customised information.
Since launch, Riva Digital Media has struggled to establish
Epacs as a widely used consumer application for the consumption of
mixed digital media. The company's business model, which required
significant web traffic to generate advertising income as well as
charging for premium content, has not worked as originally
envisaged. In response the management cut costs significantly while
the business model was redeveloped.
Recent Developments
It continues to remain difficult to assess the future prospects
of Riva Digital Media and, as a consequence, the fair value was
written down to zero in the 2011/12 financial year. Nevertheless,
the company has a number of projects included in its development
pipeline that once launched may allow for a positive revision to
the fair value of the IBIS investment.
Investment Portfolio Summary
as at 31 July 2013
As at 31 July 2013 As at 31 January
2013
% of net % of net
Cost Valuation assets Cost Valuation assets
Company GBP GBP by value GBP GBP by value
---------------------- ---------- ---------- --------- ---------- ---------- ---------
Steel River Media
(Contagious) 850,000 1,939,757 32.56 850,000 1,842,683 31.14
Ginx TV 985,000 1,679,884 28.20 985,000 1,401,695 23.68
Get Me Media 806,442 999,938 16.79 806,442 999,938 16.89
Masher 564,333 354,587 5.95 564,333 354,587 5.99
Freshwater 864,499 329,972 5.54 864,499 322,484 5.45
Futurelex 950,000 200,000 3.36 950,000 321,876 5.44
Riva Digital Media 349,515 0 0 349,515 0 0
---------------------- ---------- ---------- --------- ---------- ---------- ---------
Total venture
capital investments 5,369,789 5,504,138 92.40 7,761,408 5,243,263 88.59
---------------------- ---------- ---------- --------- ---------- ---------- ---------
Total fixed asset
investments 5,369,789 5,504,138 92.40 7,761,408 5,243,263 88.59
---------------------- ---------- ---------- --------- ---------- ---------- ---------
Net current assets 452,973 7.60 675,056 11.41
---------------------- ---------- ---------- --------- ---------- ---------- ---------
Net assets 5,957,111 100.00 5,918,319 100.00
---------------------- ---------- ---------- --------- ---------- ---------- ---------
Statement of the Directors' Responsibilities in respect of the
Half-Yearly Financial Report
We confirm that to the best of our knowledge:
-- The condensed set of financial statements has been prepared
in accordance with the Statement "Half-yearly financial reports"
issued by the UK Accounting Standards Board
-- The Chairman's Statement (constituting the interim management
report) includes a fair review of the information required by DTR
4.2.7R of the "Disclosure and Transparency Rules", being an
indication of important events that have occurred during the first
six months of the financial year and their impact on the condensed
set of financial statements
-- The "Statement of Principal Risks and Uncertainties" on page
15 is a fair review of the information required by DTR 4.2.7R,
being a description of the principal risks and uncertainties for
the remaining six months of the year
-- The financial statements include a fair review of the
information required by DTR 4.2.8R of the "Disclosure and
Transparency Rules", being related party transactions that have
taken place in the first six months of the current financial year
and that have materially affected the financial position or
performance of the entity during that period; and any changes in
the related party transactions described in the last annual report
that could do so.
By Order of the Board
The City Partnership (UK) Limited
Company Secretary
30 September 2013
Statement of Principal Risks and Uncertainties
The Company's assets consist of equities and fixed interest
investments, cash and liquid resources. Its principal risks are
therefore market risk, interest rate risk, credit risk and
liquidity risk. Other risks faced by the Company include economic,
investment, financial and regulatory risks. These risks, and the
way in which they are managed, are described in more detail in the
Directors' Report, the Statement of Corporate Governance and Note
18 to the Financial Statements in the Company's Annual Report &
Financial Statements for the year ended 31 January 2013. The
Company's principal risks and uncertainties have not changed
materially since the date of that report.
Related Parties
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