TIDMIMMO
RNS Number : 1353N
Immotion Group PLC
28 September 2021
28 September 2021
Immotion Group plc
("Immotion Group", the "Company" or the "Group")
Interim Results
Immotion Group plc (AIM:IMMO), the immersive entertainment
group, is pleased to announce its interim results for the six
months to 30 June 2021.
Highlights
-- H1 2021 revenue GBP2.8m
-- Near breakeven result in H1 - EBITDA loss GBP31k
-- Outstanding performance in Q3 - revenue circa GBP3m,
estimated EBITDA circa GBP0.6m, adjusted PBT breakeven [1]
-- Six consecutive months of underlying EBITDA profit (April-September)
-- Record Group results for June, July and August
-- H2 expected to be strongly cash generative. Cash on hand GBP0.9m (30 June 2021: GBP0.6m)
-- Location Based Entertainment ("LBE") division - almost all sites now open and trading
-- H2 seeing growing revenue and contributions from Home Based Entertainment ("HBE") and Uvisan
-- New LBE zoo offering in production for spring 2022 launch
-- New HBE product - "Vodiac" - to be beta launched in Q4 2021
-- Uvisan received first significant NHS order for 64 cabinets
Robin Miller, Chairman of Immotion Group said:
"Our H1 result is very encouraging, particularly as conditions
in the early part of the period remained challenging to say the
least. April saw us reach underlying EBITDA profit for the first
time, and we have maintained this performance every month since.
Our core Location Based Entertainment ("LBE") business has
recovered strongly and enjoyed a buoyant summer period.
Following this, we have seen a very strong start to H2 and,
accordingly, we expect Q3 to deliver overall Group revenue of circa
GBP3m and EBITDA of GBP0.6m. Momentum is growing in our HBE and
Uvisan businesses and this augurs well for Q4 when we believe,
based on current performance, they will in aggregate deliver
significant revenue, margin and net cash inflow.
Our LBE business will continue to focus on larger installations
while creating new content to launch into the global zoo market -
which we believe to be considerably larger than the aquarium market
- in the early part of next year.
HBE, while continuing to build momentum with the "Let's Explore
Oceans" range of content, will also be launching an exciting new
product, "Vodiac", offering a much broader and deeper choice of
channels.
Securing our first significant order for the NHS was a major
milestone for Uvisan, our UV-C disinfection business. This, plus
the ongoing pandemic and resultant heightened profile of workplace
safety and hygiene, gives us confidence that demand for these
products is going to be with us for the foreseeable future and
provides a positive backdrop for growth.
The creation of the HBE and Uvisan divisions has provided us
with two further significant growth opportunities and the early
signs are very promising. This is a real testament to the team, its
entrepreneurial spirit and determination not just to survive but to
prosper.
In conclusion, we have confidence that there are plentiful
growth opportunities ahead."
The information contained within this announcement is deemed by
the Company to constitute inside information under the Market Abuse
Regulation (EU) No. 596/2014 ("MAR") as it forms part of UK
domestic law by virtue of the European Union (Withdrawal) Act 2018
and is disclosed in accordance with the Company's obligations under
Article 17 of MAR.
Enquiries:
For further information please visit www.immotion.co.uk , or
contact:
Immotion Group Martin Higginson Tel + 44 (0) 207
David Marks 220 1666
WH Ireland Limited Adrian Hadden Tel + 44 (0) 207
(Nomad and Joint Darshan Patel 220 1666
Broker) Ben Good
Alvarium Capital Alex Davies Tel: +44 (0) 207
Partners 195 1458
(Joint Broker)
Shard Capital Partners Damon Heath Tel: +44 (0) 20 7186
LLP Erik Woolgar 9900
(Co-Broker)
Overview
We are delighted with the performance of our Group in H1.
Despite a very challenging start to the year, the Group produced
its best ever result with a small overall EBITDA loss for the first
half of GBP31k on revenue of GBP2.8m.
This was an excellent outcome given that trading conditions in
the first three months of the period were very challenging as
COVID-19 restrictions persisted and many sites remained closed or
severely impacted. In fact, the Group recorded an EBITDA loss of
GBP0.2m in the first quarter.
We were delighted to see the Group finally reach underlying
monthly EBITDA profit in each of the three months of the second
quarter - this is a real landmark for the Group, emerging from the
long periods of lockdowns to clearly demonstrate its potential.
Cost control remained a key focus and we implemented a small
number of redundancies and have taken steps to reduce our occupancy
costs. Administrative expenses (excluding depreciation,
amortisation, impairment, share-based payments, profit/loss on
asset disposals, restructuring costs and other exceptional items)
fell to GBP1.4m (H1 2020: GBP1.5m), being an average of GBP235k per
month. We expect administrative expenses to remain around this
level but there may be, as would be expected, some degree of
variable cost fluctuation as activity levels increase across the
three businesses (e.g. travel and trade shows).
The difference between EBITDA and operating cash flow was almost
entirely a result of total net working capital outflows of GBP0.8m
in the period. This related in the main to an increase in trade and
other receivables of GBP0.6m in the period that occurred naturally
as the LBE business activity increased dramatically in Q2.
Additionally, there was an overall reduction of trade and other
payables of GBP0.2m as we caught up on liabilities that had built
up during the lockdown period last year, including paying off all
remaining overdue amounts to HMRC.
Inventories at period end were GBP163k (31 December 2020:
GBP152k), primarily comprised of HBE stock held. In addition, the
H1 closing balance sheet includes net HBE stock prepayments of
GBP227k (comprised of stock in production/transit, less
corresponding payments yet to be made). Having planned ahead, we
should now be very well placed to capitalise on the key Q4
period.
Post period-end trading
The second half has begun very strongly with record results in
July and August. September will be another strong month and, with
the contribution of HBE and Uvisan now growing strongly, we expect
overall Group revenue for Q3 to be circa GBP3.0m and underlying
EBITDA to be circa GBP0.6m.
Q1 2021 Q2 2021 Q3 2021 YTD
Unaudited Unaudited Estimate Estimate
GBPm GBPm GBPm GBPm
Revenue 0.8 2.0 3.0 5.8
EBITDA (0.2) 0.2 0.6 0.6
Adjusted PBT
[2] (0.8) (0.3) 0.0 (1.1)
Despite the LBE division moving into its quieter period, we are
confident of a profitable fourth quarter for the Group. The HBE
division has seen a strong surge in revenue and margin in September
and it will have plenty of stock at its disposal to deliver
significant revenue, margin and cash inflow in Q4 if this trend
continues. Uvisan has seen a growing order book from its reseller
and distributor network and this is translating into growing
revenue and contribution.
We expect H2 to be strongly cash generative, providing us with
the flexibility to bring forward any stock or equipment orders to
address international shipping concerns.
The Group currently has cash of GBP0.9m, up from GBP0.6m as at
30 June 2021, which reflects the extremely strong trading of the
LBE business during the summer months.
We present below our review of the period and prospects for each
division and the Group.
Location Based Entertainment ("LBE")
The Group outcome in H1 was driven in the main by the recovery
of the LBE Business. We saw monthly revenue in this division grow
almost six-fold from January to June as sites reopened and trading
conditions improved.
Total revenue in this division in the period was GBP2.3m and
gross profit was GBP1.0m (being total revenue less partner share
and other direct costs of sales, including rent and payroll in our
ImmotionVR sites).
We believe the result is a strong endorsement of the partner
model and the substantial investment made pre-pandemic to establish
and grow it.
Our current portfolio is presented in the table below. I am
pleased to report that almost all of our locations have now
re-opened and are trading, though we expect our Australian
installations in Sydney (two sites) and Melbourne (one site) to
remain closed for some time to come as lockdown continues in the
states of New South Wales and Victoria.
Total USA UK ROW
Sites Headsets Sites Headsets Sites Headsets Sites Headsets
At 1 January
2021 48 345 24 163 14 121 10 61
Installed
in 2021 7 70 4 52 2 14 1 4
Uninstalled
in 2021 (4) (27) (1) (2) (2) (21) (1) (4)
At 27 September
2021 51 388 27 213 14 114 10 61
In the period we opened seven new locations (64 headsets)
including the 22-headset installation at Clearwater Marine
Aquarium, Florida which opened in March 2021 and has traded very
well throughout the summer. We were pleased that the agreement in
relation to Clearwater has now been extended through to March
2023.
The current operational status of our installed base is as
follows:
Total USA UK ROW
Sites Headsets Sites Headsets Sites Headsets Sites Headsets
At 27 September
2021 51 388 27 213 14 114 10 61
Fully operational 44 358 24 203 14 114 6 41
Site closed 3 14 - - - - 3 14
Site open
but installation
not operating 4 16 3 10 - - 1 6
Throughout the period we suffered reduced capacity at Shark Reef
Aquarium at Mandalay Bay, our flagship Las Vegas installation, due
to local restrictions but these were finally removed from 1 July
2021 and this has had a significant positive impact on subsequent
trading.
Since the period end, we have seen very strong trading in our
LBE business in July and August with revenue in excess of GBP900k
in both months, though we will see the significant seasonal
slow-down kick in from September as school holidays have now ended
in the USA and UK.
As can be seen from the summer period, our LBE business has now
reached a tipping point where its contribution can generate
significant overall monthly profit for the Group in the summer
months. Even in the quieter months, we believe it should at its
current scale, cover most if not all of the Group's fixed costs of
operation. This combined with the busier period for HBE, as well as
growing sales in Uvisan gives us a well-balanced portfolio of
businesses.
The costs of operation in the LBE division should remain
relatively stable with almost all gross profit from new sites now
dropping straight to the EBITDA line. Even with our conservative
depreciation policies on plant and equipment (we believe lifetimes
of motion platforms are considerably longer than three years), new
sites should add strongly to the PBT line.
We were, as previously advised, deliberately cautious this year
in terms of new site openings. However, we are seeing healthy
levels of enquiries from the aquarium sector, where we now enjoy a
strong reputation.
We intend to launch in the zoo market in spring 2022. We have
been filming new immersive, 360-degree, live action endangered
species content in Africa, which we expect to unveil in Q4, when we
also hope to announce initial partner zoos. We would expect
installations to begin in time for spring 2022.
We believe the zoo market to be both global and several times
the size of the aquarium sector, sharing the features that
attracted us to the aquarium market: large numbers of high traffic,
high quality potential partners, on a global basis.
For both aquariums and zoos, our focus will be where possible to
open larger formats based on the know-how we have developed at
Mandalay Bay, Clearwater Marine Aquarium and Sea Life Orlando.
Where size allows these new installations will take the form of
mini-theatres complete with pre-show areas. We want these to be
exciting new core attractions for the partner sites, as well as
delivering significant revenue for both parties.
In short, we believe there are plentiful growth opportunities
for our LBE business which we are well placed to capitalise
upon.
Home Based Entertainment ("HBE")
We launched our HBE division with sales of Let's Explore Oceans
("LEO") commencing in mid-October 2020, selling only in the UK
market. In Q4 2020, we sold circa 11,000 LEO packs and recorded
revenue of circa GBP0.7m.
We always expected the LEO product to be highly seasonal, so H1
2021 was, as expected, a quieter period. For a gift type product at
its price point the LEO pack was always likely to see a drop in
consumer intent to purchase post-Christmas.
Accordingly, in H1 we have sought to expand the global marketing
and sales of the product, delivering to a number of key countries,
including USA, Canada, Australia, as well as the UK, recording
revenue of GBP0.3m (3,000 packs).
Though it resulted in a loss after product, marketing and
fulfilment costs of circa GBP0.1m, this period has given us an
enormous amount of learning ahead of the key Q4 period for this
year and enabled us to identify the most lucrative potential global
markets for Q4 2021 as well as continue development of additional
experiences.
Our focus for the remainder of this year will be USA, Canada, UK
and Australia. With stock on hand, and stock already purchased for
delivery in coming weeks, we have the potential in Q4 to sell circa
28,000 units. Having planned forward we have secured stock at
substantially lower unit cost than 2020, so that even allowing for
increased shipping costs in the current shipping crisis, we are
well placed.
To ensure we can supply our target markets as effectively as
possible, we have established third party logistics and fulfilment
relationships in the UK, USA and China and we also began trading on
Amazon in both the USA and UK and we are seeing growing volumes
through these channels.
Customer acquisition remains our most material cost of sale and
we expect this to fall in the Q4 period when demand is strongest
and customer intent high. Our key marketing channels are social
media sites, which allows us to access a huge addressable market
very rapidly. Amazon is obviously a key channel in its own right
which complements our social media activity.
We have seen a substantial uptick in the HBE business post
period end, with aggregate revenue for July and August of GBP253k
and improving, positive margins (after product cost, customer
acquisition and fulfilment). September to date has been very strong
with revenue on target to end the month at circa GBP300k, again
with strong margins.
This augurs well for the balance of the year. As noted above,
between stock on hand and orders placed we have circa 28,000 pieces
of LEO stock, with substantial deposits having already been paid on
un-delivered stock. If the metrics seen in the last few weeks
continue - with average order values of in excess of GBP80 and
strong margins per unit being achieved - we should see very
substantial revenue, margin and net cash inflow in Q4 from this
division.
As far as 2022 is concerned, we will be continuing to finesse
the LEO product, whilst also launching a lower price point product,
"Vodiac". The new offering will boast a number of VR channels
allowing us to offer a range of VR video content, both on a free
and rental basis. The broadening of content, verticals and lower
price point should allow us to expand significantly the potential
audience. The new content, which will include our "Dinosaur
Safari", will also be made available to all existing LEO users and
in good time for new users opening their parcels, which will likely
be concentrated around the Christmas and festive holiday
season.
Uvisan
This is Uvisan's first full year of trading and H1 saw it make
good progress, delivering a small but profitable contribution.
The versatility of our UV-C cabinet meant we supplied a number
of sectors including education (with particular success with
universities), leisure, media and healthcare, with some
high-profile counterparties, including our first supplies into the
NHS.
It is pleasing to note that our UV-C disinfection cabinet meets
the cleaning criteria of both Microsoft (HoloLens) and Hewlett
Packard for their range of VR headsets (we are specifically
recommended by HP as one of only two recommended UV-C disinfection
products for their headsets).
The emphasis in the period for Uvisan was very much on growing
the reseller and distributor base and we are pleased to now have a
network of 10 active resellers which, we believe, will benefit us
in terms of volume moving forwards. We signed an exclusive
distribution agreement for Australia and New Zealand and are
pleased to report that the first container of product will be
arriving there imminently. We continue to sign new agreements
(including our first agreements for the USA) with partners who we
believe have deep knowledge of, and customer relationships in,
their vertical channels.
The global installed base of headsets is forecast to grow
massively, particularly in training and education settings, and we
intend to be a product of choice for businesses and organisations
wanting hassle free and safe disinfection of their valuable headset
fleets.
The second half will see a substantial increase in revenue as
cabinet orders on hand from the reseller network begin to be
fulfilled.
We chose to delay the launch of "Cleanroom by Uvisan" pending an
official launch at a number of major healthcare related conferences
which we are attending in the coming months.
Additionally, we are complementing the product range so that we
can cater to a wider range of needs and budgets. We are looking to
include UV-C air filtering equipment and static light arrays in our
range, which we believe will give us a wider addressable audience
and better equip us to compete for large healthcare and other
public sector opportunities.
The objective in the coming 18 months is to grow Uvisan into a
specialist in UV-C based disinfection rather than an opportunistic
reseller of the cabinets. We believe that the heightened focus on
disinfection as a result of the continuing COVID-19 pandemic and
the growth of VR and AR headset use provide a very supportive
backdrop.
Outlook
Whilst not beyond doubt, it does now appear that the likelihood
of protracted lockdowns because of the COVID-19 pandemic has
diminished. The period since March 2021 has demonstrated the true
potential of our LBE business and we will look to grow this
significantly in 2022 as we launch our new zoo product and
increasingly seek to focus on larger 'dial-moving' sites.
We believe there are huge growth opportunities in front of us in
both the aquarium and zoo sectors and with a more stable
environment we will look to accelerate growth as we move into
2022.
In our HBE and Uvisan businesses we have the potential for two
further high growth businesses which we believe can contribute
significantly to the Group and complement our LBE division.
Against this backdrop we currently feel very optimistic about
our prospects for the remainder of 2021 and beyond.
IMMOTION GROUP PLC
INTERIM CONSOLIDATED INCOME STATEMENT
for the six months ended 30 June 2021
Unaudited Unaudited Audited
Notes Six months Six months 12 months
to to to
30 June 30 June 31 December
21 20 20
GBP'000 GBP'000 GBP'000
Revenue 3 2,760 818 2,848
Cost of sales (1,781) (789) (2,382)
_______ _______ _______
Gross profit 979 29 466
Other income 4 399 308 575
Administrative expenses (2,779) (2,867) (5,779)
_______ _______ _______
Operating loss (1,401) (2,530) (4,738)
Memorandum:
Adjusted EBITDA (31) (1,212) (1,690)
Amortisation (313) (352) (719)
Depreciation (787) (851) (1,751)
Share based payments (291) (64) (194)
Impairment of tangible and intangible
assets (1) - (253)
Profit / (loss) on disposal
of fixed assets 11 (24) (35)
Restructuring costs 5 (42) (27) (96)
Exceptional income 6 53 - -
______ ______ ______
Loss from operations (1,401) (2,530) (4,738)
--------------------------------------- ------ ----------- ----------- ------------
Finance costs (26) (45) (82)
Finance income - 1 2
______ ______ ______
Loss before taxation (1,427) (2,574) (4,818)
Tax credit 12 58 86
______ ______ ______
Loss for the period after taxation (1,415) (2,516) (4,732)
======== ======== ========
Other comprehensive income /
(expense) for the period
Profit / (loss) on translation
of subsidiary (20) 67 (35)
Total comprehensive expense
for the period (1,435) (2,449) (4,767)
======== ======== ========
Earnings per share 7 GBP0.01 GBP0.01 GBP0.01
Basic EPS (0.34) (0.77) (1.33)
Diluted EPS (0.34) (0.77) (1.33)
IMMOTION GROUP PLC
INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the six months ended 30 June 2021
(unaudited)
Foreign
Share Share Retained exchange Total
capital premium earnings reserve equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 31 December
2019 115 15,310 (9,105) (45) 6,275
Total comprehensive expense
for the period - - (2,516) - (2,516)
Currency translation
of overseas subsidiary - - - 67 67
Issue of new shares 37 4,164 - - 4,201
Issue costs deducted
from equity - (328) - - (328)
-
Share based payment expense - - 64 - 64
_____ _____ _____ _____ _____
Balance at 30 June 2020 152 19,146 (11,557) 22 7,763
_____ _____ _____ _____ _____
Total comprehensive expense
for the period - - (2,216) - (2,216)
Issue of new shares 12 1,188 - - 1,200
Issue costs deducted
from equity - (61) - - (61)
Share based payment expense - - 130 - 130
Currency translation
of overseas subsidiary - - - (102) (102)
_____ _____ _____ _____ _____
Balance at 31 December
2020 164 20,273 (13,643) (80) 6,714
_____ _____ _____ _____ _____
Total comprehensive expense
for the period - - (1,415) - (1,415)
Currency translation
of overseas subsidiary - - - (20) (20)
Issue of new shares 3 297 - - 300
Issue costs deducted
from equity - (14) - - (14)
Share based payment expense - - 291 - 291
_____ _____ _____ _____ _____
Balance at 30 June 2021 167 20,556 (14,767) (100) 5,856
_____ _____ _____ _____ _____
IMMOTION GROUP PLC
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
as at 30 June 2021
Unaudited Unaudited Audited
Notes 30 June 2021 30 June 2020 31 Dec 2020
GBP'000 GBP'000 GBP'000
ASSETS
Non-current assets
Property, plant and equipment 1,444 2,638 1,954
Right of use assets 207 580 306
Intangible assets 8 3,448 3,971 3,625
______ ______ ______
Total non-current assets 5,099 7,189 5,885
______ ______ ______
Current assets
Inventories 163 - 152
Trade and other receivables 9 1,412 577 829
Contract assets 91 91 91
Cash and cash equivalents 629 1,811 1,664
______ ______ ______
Total current assets 2,295 2,479 2,736
______ ______ ______
Total assets 7,394 9,668 8,621
______ ______ ______
LIABILITIES
Current liabilities
Trade and other payables 10 (959) (947) (1,153)
Finance leases (222) (340) (231)
Loans (140) (180) (175)
Deferred tax - (7) -
Contract liabilities (6) (12) (12)
_______ _______ _______
Total current liabilities (1,327) (1,486) (1,571)
_______ _______ _______
Total current net assets 968 993 1,165
Non-current liabilities
Loans (153) (95) (160)
Finance leases (58) (324) (176)
Other payables - - -
_______ _______ _______
Total non-current liabilities (211) (419) (336)
_______ _______ _______
TOTAL NET ASSETS 5,856 7,763 6,714
_______ _______ _______
CAPITAL AND RESERVES
ATTRIBUTABLE TO EQUITY HOLDERS
OF THE PARENT
Issued share capital 11 167 152 164
Share premium account 20,556 19,146 20,273
Foreign exchange reserve (100) 22 (80)
Retained earnings (14,767) (11,557) (13,643)
_______ _______ _______
5,856 7,763 6,714
_______ _______ _______
IMMOTION GROUP PLC
CONSOLIDATED CASH FLOW STATEMENT
for the six months ended 30 June 2021
Unaudited Unaudited Audited
Six months Six months 12 months
to to to
30 June 2021 30 June 2020 31 Dec 2020
GBP'000 GBP'000 GBP'000
OPERATING ACTIVITIES
Loss before tax (1,427) (2,574) (4,818)
Adjustments for:
Share based payments 291 64 194
Depreciation 787 851 1,751
(Profit) / loss on disposal of fixed
assets (11) 24 35
Amortisation 313 352 719
Impairment of intangible assets 1 - 253
Finance costs 26 45 82
Finance income - (1) (2)
Foreign exchange on retranslation
of fixed assets (25) (101) (72)
Foreign exchange (loss) / gain (20) 67 (35)
Taxation (paid) / refunded (3) - 73
_____ _____ _____
Operating loss before changes in
working capital and provisions (68) (1,273) (1,820)
Increase in stocks (10) - (152)
(Increase) / decrease in trade and
other receivables (569) 173 (132)
Increase / (decrease) in trade and
other payables (200) (113) 92
_____ _____ _____
Cash used in operating activities (847) (1,213) (2,012)
_____ _____ _____
INVESTING ACTIVITIES
Purchase of property, plant and equipment (217) (931) (1,069)
Purchase of intangible assets (138) (288) (545)
Disposals of property, plant and
equipment 27 54 159
Foreign exchange on retranslation
of fixed assets 50 - 62
_____ _____ _____
Cash consumed by investing activities (278) (1,165) (1,393)
_____ _____ _____
FINANCING ACTIVITIES
Finance costs (26) (45) (82)
Finance income - 1 2
New Loans and finance leases 116 174 302
Loan repayments (154) (55) (95)
Finance lease repayments (124) (233) (520)
Foreign exchange on retranslation
of financing (8) - (24)
Issue of ordinary shares 300 4,201 5,401
Costs on issue of shares (14) (328) (389)
_____ _____ _____
Cash generated by financing activities 90 3,715 4,595
(DECREASE) / INCREASE IN CASH AND
CASH (1,035) 1,337 1,190
EQUIVALENTS --------------- --------------- ---------------
Cash and cash equivalents brought
forward 1,664 474 474
_____ _____ _____
CASH AND CASH EQUIVALENTS CARRIED
FORWARD 629 1,811 1,664
_____ _____ _____
IMMOTION GROUP PLC
NOTES TO THE INTERIM REPORT
for the six months ended 30 June 2021
1. Corporate information
The interim consolidated financial statements of the Group for
the period ended 30 June 2021 were authorised for issue in
accordance with a resolution of the directors on 27 September 2021.
Immotion Group plc ("the Company") is a Public Limited Company
quoted on AIM, incorporated in England and Wales. The interim
consolidated financial statements do not comprise statutory
accounts within the meaning of section 434 of the Companies Act
2006.
2. Statement of Accounting policies
2.1 Basis of Preparation
The entities consolidated in the half year financial statements
of the Company for the six months to 30 June 2021 comprise the
Company and its subsidiaries (together referred to as "the
Group").
The interim consolidated financial statements do not include all
the information and disclosures required in the annual financial
statements and should be read in conjunction with the Group's
annual audited consolidated financial statements for the year ended
31 December 2020.
The directors are satisfied that, at the time of approving the
consolidated interim financial statements, it is appropriate to
adopt a going concern basis in accordance with the recognition and
measurement criteria of International Financial Reporting Standards
("IFRS") as adopted by the European Union.
2.2 Accounting Policies
The interim results announcement has been prepared in accordance
with IFRS, International Accounting Standards and Interpretations
issued by the International Accounting Standards Board, as adopted
by the European Union, and with those parts of the Companies Act
2006 applicable to companies preparing their accounts under IFRS.
The consolidated financial statements have been prepared under the
historical cost convention.
The principal accounting policies adopted in the preparation of
these interim consolidated financial statements are consistent with
those followed in the preparation of the Group's annual audited
consolidated financial statements for the year ended 31 December
2020, except for the new and revised IFRSs effective 1 January
2021. None of the new IFRS and IFRS amendments effective on 1
January 2021 have had a material impact on the interim consolidated
financial statements of the Group.
The preparation of these consolidated half year financial
statements requires management to make judgments, estimates and
assumptions that affect the application of accounting policies and
the reported amounts of assets and liabilities, income and expense.
Actual results may differ from these estimates in preparing these
consolidated half year financial statements.
Going concern - at the time of approving the interim financial
statements, the Directors have a reasonable expectation that the
Company and the Group have adequate resources to continue in
operational existence. The going concern basis of accounting has
therefore been adopted in preparing the interim financial
statements.
In reaching this conclusion, the Directors considered the
financial position of the Group and prepared forecasts to 31
December 2022, taking into account reasonably possible changes in
trading.
Whilst the forecasts prepared did not indicate a requirement for
additional funding to enable the Group to continue being able to
operate as a going concern, the Directors note that there remains
considerable uncertainty as to the impact that the ongoing COVID-19
pandemic could have on the Location Based Entertainment business in
particular. If there were to be further lockdowns, for example,
this could have a material impact on the Group's ability to
generate revenue from partner and ImmotionVR sites. Should this
happen, the Directors may need to consider mitigating actions such
as seeking any government support available, identifying cost
savings and/or seeking external finance in the form of debt or
equity.
Impairment of intangible assets and goodwill - recoverable
amounts are based on value in use calculations using management's
best estimate of future performance. On the basis of the forecast
cash flows prepared it is concluded
that no impairment of intangible assets and goodwill is
required.
2.2 Accounting Policies (continued)
Government grants and assistance - the Group has applied IAS 20
- Accounting for Government Grants and Disclosure of Government
Assistance - in relation to Government grants received in the
period to 30 June 2021 (further details in Note 4).
In accordance with IAS 20 the accruals' method of accounting has
been adopted.
-- grants in recognition of specific expenses are recognised in
profit or loss in the same period as the relevant expenses;
-- grants related to depreciable assets are recognised in profit
or loss over the periods and in the proportions in which
depreciation expense on those assets is recognised; and
-- grants related to non-depreciable assets which require the
fulfilment of certain obligations are recognised in profit or loss
over the periods that bear the cost of meeting the obligations.
3 Segmental Information
The Group's primary reporting format for segmental information
is business segments which reflect the management reporting
structure in the Group. There have been no changes to the segments
employed within the period.
Location Home Based Total
Based Entertainment Entertainment 6 months
(LBE) (HBE) Head Office to 30 June
2021
GBP'000 GBP'000 GBP'000 GBP'000
Revenue 2,302 337 121 2,760
Cost of sales (1,302) (436) (43) (1,781)
Government grants 313 57 14 384
Rent income - - 15 15
Admin expenses* (439) (343) (627) (1,409)
---------------- ---------------- ---------------- ---------------
Operating profit / (loss) 874 (385) (520) (31)
Amortisation (255) (47) (11) (313)
Depreciation (717) - (70) (787)
Profit on disposal of
fixed assets 11 - - 11
Impairment of tangible
and intangible assets (1) - - (1)
Restructuring costs (3) (39) - (42)
Exceptional income - - 53 53
Finance costs - - (26) (26)
Finance income - - - -
Share based payments - - (291) (291)
Taxation - - 12 12
---------------- ---------------- ---------------- -------------
Loss for the period (91) (471) (853) (1,415)
---------------- ---------------- ---------------- ------------
6 months to 30 June 2021
*Administrative expenses exclude depreciation, amortisation,
impairment, profit on disposal of fixed assets, exceptional income,
restructuring costs and share based payments.
Revenue in the Head Office segment is comprised of income from
Uvisan and licensing of the Group's content to third parties.
3. Segment Information (continued)
External revenue by location Location of assets Net tangible capital
of customer expenditure by
location
of assets
30 Jun 30 Jun 31 Dec 30 Jun 30 Jun 31 Dec 30 Jun 30 Jun 31 Dec
2021 2020 2020 2021 2020 2020 2021 2020 2020
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
USA 2,090 301 1,176 1,920 1,988 1,542 182 692 813
UK 327 345 1,395 5,361 7,449 6,901 29 239 266
Australia 163 85 124 26 41 35 6 - 8
Canada 44 - - - - - - - -
China 33 7 35 6 12 9 - - -
Saudi
Arabia 20 29 35 34 65 50 - - -
UAE 17 39 38 32 74 56 - - 6
Other 66 12 45 15 39 28 - - 2
_____ _____ _____ _____ _____ _____ _____ _____ _____
Total 2,760 818 2,848 7,394 9,668 8,621 217 931 1,095
_____ _____ _____ _____ _____ _____ _____ _____ _____
The Group had certain customers whose revenue individually
represented 10% or more of the Group's total revenue. For the six
months ended 30 June 2021, two customers accounted for 31% and 20%
of the revenue respectively.
4 Other Income
Unaudited Unaudited Audited
Six months Six months 12 months
to to to
30 June 30 June 31 Dec 20
21 20
GBP'000 GBP'000 GBP'000
UK and USA national & local government
COVID-19 relief programmes 384 259 479
Property rentals 15 49 96
---------------- ---------------- ----------------
399 308 575
---------------- ---------------- ----------------
The Group is satisfied that it has met all the conditions
relating to grants received and that no liability for repayment of
any of the grants exists.
5 Restructuring costs
Unaudited Unaudited Audited
Six months Six months 12 months
to to to
30 June 30 June 31 Dec 20
21 20
GBP'000 GBP'000 GBP'000
Business restructuring (2) 13 16
COVID-19 effects - redundancies
and aborted projects 44 14 80
---------------- ---------------- ----------------
42 27 96
---------------- ---------------- ----------------
6 Exceptional income
Unaudited Unaudited Audited
Six months Six months 12 months
to to to
30 June 30 June 31 Dec 20
21 20
GBP'000 GBP'000 GBP'000
Liability to HMRC for Loan Charge
taxation revised 53 0 0
---------------- ---------------- ----------------
As a result of the Loan Charge review commissioned by the UK
Government in 2019 the Group's liability to HMRC for Loan Charge
taxation, and interest thereon, was reduced by a total of GBP53k.
Confirmation of this reduction was received from HMRC in March
2021.
7 Earnings per share
The calculation of the group basic and diluted loss per ordinary
share is based on the following data:
Unaudited Unaudited Audited
Six months Six months 12 months
to to to
30 June 30 June 31 Dec 20
21 20
GBP'000 GBP'000 GBP'000
The earnings per share is based
on the following:
Continuing earnings post tax
loss attributable to shareholders (1,415) (2,516) (4,732)
Discontinued earnings post tax - - -
attributable to shareholders
========= ============== ==========
====== ====
Basic weighted average number
of shares 412,738,083 328,286,069 356,941,188
Diluted weighted average number
of shares 412,738,083 328,286,069 356,941,188
========= ============== ==============
=====
GBP0.01 GBP0.01 GBP0.01
Basic earnings per share (0.34) (0.77) (1.33)
Diluted earnings per share (0.34) (0.77) (1.33)
========= ========= =========
Earnings per ordinary share has been calculated using the
weighted average number of shares in issue during the period. The
weighted average number of equity shares in issue in the period to
30 June 2021 was 412,738,083.
8. Intangible Assets
Goodwill
Other intangible acquired Development
assets on acquisition costs Total
GBP'000 GBP'000 GBP'000 GBP'000
Cost
At 1 January 2021 545 2,438 2,166 5,149
Additions 5 - 133 138
Foreign exchange
adjustment - - (6) (6)
_____ _____ _____ _____
At 30 June 2021 550 2,438 2,293 5,281
_____ _____ _____ _____
Amortisation
At 1 January 2021 527 - 997 1,524
Charge 10 - 303 313
Foreign exchange
adjustment - - (4) (4)
_____ _____ _____ _____
At 30 June 2021 537 - 1,296 1,833
_____ _____ _____ _____
Net book value
30 June 2021 13 2,438 997 3,448
_____ _____ _____ _____
31 December 2020 18 2,438 1,169 3,625
_____ _____ _____ _____
Development costs are fully amortised on a straight-line basis
over 3 years.
For projects which are still underway and are not ready to be
used no amortisation has been charged.
Other intangible assets are being amortised principally over a
period of 3 years. Domains are amortised over 10 years. Websites
and trademarks are amortised over 2 years.
Goodwill is not amortised.
Amortisation is charged to administrative costs in the Statement
of Comprehensive Income.
9. Trade and other receivables
Unaudited Unaudited Audited
Six months Six months 12 months
to to to
30 June 30 June 31 Dec 20
21 20
GBP'000 GBP'000 GBP'000
Trade receivables 364 107 102
Accrued income
Prepayments: 290 8 71
- Home Based Entertainment stock
in production/transit 351 - 288
- Other 248 233 235
Corporation tax 81 118 65
Other receivables 78 111 68
---------------- ---------------- ----------------
1,412 577 829
---------------- ---------------- ----------------
10. Trade and other payables
Unaudited Unaudited Audited
Six months Six months 12 months
to to to
30 June 30 June 31 Dec 20
21 20
GBP'000 GBP'000 GBP'000
Trade payables 500 415 594
Accruals 280 164 263
Payroll taxes and social security 50 206 146
Other payables 129 162 150
---------------- ---------------- ----------------
959 947 1,153
---------------- ---------------- ----------------
11. Share Capital
Called up share capital No. Value
Allotted, issued and fully GBP'000
paid
Ordinary shares of 0.040108663
pence each 415,538,083 167
============= ==========
Shares issued in the 6 month period to 30 June 2021:
Date Description Gross share Cash received
No shares Price/share value
GBP GBP GBP
Issue of shares
of 0.040108663p
26.03.2021 each 6,000,000 0.05 300,000 300,000
----------------------- --------------------- ---------------------
6,000,000 300,000 300,000
=========== ========== =========
As at 30 June 2020 379,538,083 20,490,582 17,275,440
As at 31 December 2020 409,538,083 21,690,582 18,475,440
As at 30 June 2021 415,538,083 21,990,582 18,775,440
12. Related party transactions
M J Higginson, a director of Immotion Group plc, is a director
and controlling shareholder of M Capital Investment Properties
Limited. Services to the value of GBP47,167 (year to 31 December
2020: GBP122,250) were invoiced in the period by M Capital
Investment Properties Limited to Immotion Group plc. At 30 June
2021, Immotion Group plc owed GBPNil (31 December 2020: GBP4,125)
to M Capital Investment Properties Limited.
R Miller, a director of Immotion Group plc, is a director of
Robin Miller Consultants Ltd. In the period, services totalling
GBP7,500 (year to 31 December 2020: GBP15,000) were billed to
Immotion Group plc from Robin Miller Consultants Ltd. At 30 June
2021, GBP1,250 (31 December 2020: GBP1,250) was owing from Immotion
Group Plc to Robin Miller Consultants Ltd.
M J Higginson, a director of Immotion Group plc, is a director
and shareholder in Huddled Group Limited. Services to the value of
GBP16,407 (year to 31 December 2020: GBP88,182) were invoiced in
the period by Huddled Group Limited to the Group. At 30 June 2021,
the Group owed GBPNil (31 December 2020: GBP15,452) to Huddled
Group Limited.
D Marks, a director of Immotion Group plc, was advanced a loan
in a prior period by the subsidiary Immotion Studios Limited.
Interest is currently charged on the loan at 2% per annum. At 30
June 2021, D Marks owed GBP15,831 (31 December 2020: GBP15,678)
inclusive of interest, to the Group.
The total amounts paid to key management personnel during the
period was GBP284,363 (year to 31 December 2020: GBP544,335). The
key management personnel are considered to be the directors of
Immotion Group plc.
[1] Adjusted PBT excludes share-based payments
[2] Adjusted PBT excludes share-based payments
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END
IR PPUGGBUPGGRM
(END) Dow Jones Newswires
September 28, 2021 02:00 ET (06:00 GMT)
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