Interim Report
Total Page:16
File Type:pdf, Size:1020Kb
0592834 127689 -,,.+-,,/ CHARACTERISTICS OF THE GROWTH ENTERPRISE MARKET (“GEM”) OF THE STOCK EXCHANGE OF HONG KONG LIMITED (THE “STOCK EXCHANGE”) GEM has been established as a market designed to accommodate companies to which a high investment risk may be attached. In particular, companies may list on GEM with neither a track record of profitability nor any obligation to forecast future profitability. Furthermore, there may be risks arising out of the emerging nature of companies listed on GEM and the business sectors or countries in which the companies operate. Prospective investors should be aware of the potential risks of investing in such companies and should make the decision to invest only after due and careful consideration. The greater risk profile and other characteristics of GEM mean that it is a market more suited to professional and other sophisticated investors. Given the emerging nature of companies listed on GEM, there is a risk that securities traded on GEM may be more susceptible to high market volatility than securities traded on the main board of the Stock Exchange and no assurance is given that there will be a liquid market in the securities traded on GEM. The principal means of information dissemination on GEM is publication on the internet website operated by the Stock Exchange. Listed companies are not generally required to issue paid announcements in gazetted newspapers. Accordingly, prospective investors should note that they need to have access to the GEM website in order to obtain up-to-date information on GEM-listed issuers. The Stock Exchange takes no responsibility for the contents of this report, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this report. This report, for which the directors of Rojam Entertainment Holdings Limited (the “Directors”) collectively and individually accept full responsibility, includes particulars given in compliance with the Rules Governing the Listing of Securities on the Growth Enterprise Market of The Stock Exchange of Hong Kong Limited (the “GEM Listing Rules”) for the purpose of giving information with regard to Rojam Entertainment Holdings Limited. The Directors, having made all reasonable enquiries, confirm that, to the best of their knowledge and belief: (1) the information contained in this report is accurate and complete in all material respects and not misleading; (2) there are no other matters the omission of which would make any statement in this report misleading; and (3) all opinions expressed in this report have been arrived at after due and careful consideration and are founded on bases and assumptions that are fair and reasonable. HIGHLIGHTS Revenue for the six months ended 30th September 2004 amounted to HK$220.0 million, representing an increase of 85% from HK$118.7 million in the corresponding period of last year. Record distribution turnover reached HK$209.9 million for the six months ended 30th September 2004, a 97% increase from HK$106.3 million in the corresponding period of last year. Profit before taxation amounted to HK$22.9 million for the six months ended 30th September 2004, representing 45 times of HK$0.5 million in the same period of previous year. Profit attributable to shareholders amounted to HK$3.7 million for the six months ended 30th September 2004, compared to loss of HK$1.5 million in the same period of previous year. Basic earnings per share for the six months ended 30th September 2004 was 0.2 HK cent, compared to the loss per share of 0.1 HK cent in last year. The acquisition of a further 20% stake in R&C was completed in September 2004. The Board does not recommend the payment of an interim dividend for the six months ended 30th September 2004. ROJAM ENTERTAINMENT HOLDINGS LIMITED INTERIM REPORT 2004/2005 1 INTERIM RESULTS The board of directors (the “Board”) of Rojam Entertainment Holdings Limited (the “Company”, together with its subsidiaries, the “Group”) is pleased to present the unaudited consolidated results of the Group for the three months and six months ended 30th September 2004 together with the comparative unaudited figures for the corresponding periods in 2003. CONSOLIDATED PROFIT AND LOSS ACCOUNT FOR THE THREE MONTHS AND SIX MONTHS ENDED 30TH SEPTEMBER 2004 Unaudited Unaudited Three months ended Six months ended 30th September 30th September 2004 2003 2004 2003 Note HK$’000 HK$’000 HK$’000 HK$’000 Turnover 2 179,895 103,847 219,958 118,662 Other revenue 2 103 87 193 225 Total revenues 179,998 103,934 220,151 118,887 Cost of sales (93,425) (65,235) (115,726) (85,799) Selling and distribution expenses (42,274) (15,696) (53,283) (19,799) Other operating expenses (17,566) (2,570) (25,468) (10,037) Amortisation of goodwill (1,377) (1,370) (2,748) (2,740) Profit before taxation 3 25,356 19,063 22,926 512 Taxation 4 (16,155) (146) (16,590) 10 Profit after taxation 9,201 18,917 6,336 522 Minority interests (2,526) (4,030) (2,615) (2,043) Profit/(loss) attributable to shareholders 6,675 14,887 3,721 (1,521) Basic earnings/(loss) per share 6 0.4 cent 1.0 cent 0.2 cent (0.1 cent) ROJAM ENTERTAINMENT HOLDINGS LIMITED 2 INTERIM REPORT 2004/2005 CONSOLIDATED BALANCE SHEET AS AT 30TH SEPTEMBER 2004 AND 31ST MARCH 2004 Unaudited Audited 30th September 31st March 2004 2004 Note HK$’000 HK$’000 Non-current assets Intangible assets 7 132,982 107,943 Fixed assets 7 19,482 29,332 Current assets Record masters 7 19,033 14,785 Inventories 8,697 12,925 Trade receivables 8 97,764 13,100 Other receivables and prepayments 26,728 29,870 Cash and bank balances 54,750 90,428 206,972 161,108 ------------- ------------- Current liabilities Trade payables 9 64,883 35,717 Accruals and other payables 44,648 28,383 Taxation payable 16,461 147 125,992 64,247 ------------- ------------- Net current assets 80,980 96,861 ------------- ------------- Total assets less current liabilities 233,444 234,136 Financed by: Share capital 10 155,468 155,468 Reserves 11 76,407 75,853 Shareholders’ funds 231,875 231,321 Minority interests 675 1,884 Non-current liabilities Deferred tax liabilities 894 931 233,444 234,136 ROJAM ENTERTAINMENT HOLDINGS LIMITED INTERIM REPORT 2004/2005 3 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHS ENDED 30TH SEPTEMBER 2004 Unaudited Six months ended 30th September 2004 2003 Note HK$’000 HK$’000 Total equity as at 1st April 231,321 225,034 Profit/(loss) attributable to shareholders 3,721 (1,521) Exchange adjustment arising on translation of the accounts of overseas subsidiaries 11 (3,167) (334) Total equity as at 30th September 231,875 223,179 CONDENSED CONSOLIDATED CASH FLOW STATEMENT FOR THE SIX MONTHS ENDED 30TH SEPTEMBER 2004 Unaudited Six months ended 30th September 2004 2003 HK$’000 HK$’000 Net cash inflow/(outflow) from operating activities 8,072 (6,438) Net cash outflow from investing activities (41,556) (10,914) Decrease in cash and cash equivalents (33,484) (17,352) Exchange difference (2,194) (2,899) Cash and cash equivalents at 1st April 90,428 80,042 Cash and cash equivalents at 30th September 54,750 59,791 Analysis of balances of cash and cash equivalents Cash and bank balances 54,750 59,791 ROJAM ENTERTAINMENT HOLDINGS LIMITED 4 INTERIM REPORT 2004/2005 NOTES TO THE CONDENSED ACCOUNTS 1. Basis of preparation and accounting policies The Company was incorporated in the Cayman Islands on 29th February 2000 as an exempted company with limited liability under the Companies Law (Revised) of the Cayman Islands. The Company’s shares were listed on GEM on 31st May 2001. These unaudited consolidated condensed accounts are prepared in accordance with Hong Kong Statement of Standard Accounting Practice 25, “Interim Financial Reporting” issued by the Hong Kong Institute of Certified Public Accountants and with the applicable disclosure requirements of Chapter 18 of the GEM Listing Rules. These condensed accounts should be read in conjunction with the 2003/2004 annual accounts. The accounting policies and methods of computation used in the preparation of these condensed accounts are consistent with those used in the annual accounts for the year ended 31st March 2004. 2. Turnover, revenue and segment information The amounts of each significant category of revenue recognised during the three months and six months ended 30th September 2004 are as follows: Three months ended Six months ended 30th September 30th September 2004 2003 2004 2003 HK$’000 HK$’000 HK$’000 HK$’000 Turnover Record distribution income 174,612 95,992 209,934 106,327 Music production income 673 3,694 1,101 5,573 Music publishing royalty 16 30 21 36 Discotheque income 4,587 3,882 8,718 6,229 Event management income – 10 – 20 Merchandise sales 7 3 10 7 Banner advertising income – 236 174 470 179,895 103,847 219,958 118,662 Other revenue Bank interest income 103 87 193 225 Total revenues 179,998 103,934 220,151 118,887 The Group is principally engaged in three main business segments: Record distribution – distributing records under its own labels and records containing master sound recordings which have been licensed from third parties in Japan Music production – provision of encompassing producer services, master tape recordings, mixing services, re-mixing services, arranging services and advisory services in respect of selection of songs for records production Discotheque – operations of discotheque ROJAM ENTERTAINMENT HOLDINGS LIMITED INTERIM REPORT 2004/2005 5 An analysis of the Group’s