DQ ENTERTAINMENT PLC 
By ?
The following announcement replaces the announcement released at 07.00 on 18 November 2013 under RNS number 2188T, the third bullet point of section 1 having been amended for clarification.
DQ Entertainment plc ('DQE', the 'Company' or the 'Group') Results for the half year ended 30 September 2013 |
DQ Entertainment (DQE) a leading global animation, gaming, live action, entertainment production and distribution company, today announces its results for the period ended 30 September 2013
1. Financial Highlights:
· Revenue: INR 870 mn (USD 14.77 mn) (2012: INR.954 mn)(USD 17.39mn)
· EBIDTA: INR 561 mn (USD 9.53 mn)(2012: INR 348 mn)(USD 6.34 mn)
· Profit before tax: INR 296 mn(USD 5.03 mn) (2012: INR 99 mn)(USD 1.8 mn)
· Profit after tax: INR 287 mn (USD 4.87 mn) (2012: INR 71 mn)(USD 1.29 mn)
· With the first signs of improvement in the global scenario your Company has buoyantly sustained itself and generated a total revenue of Rs. 870 mn during the half year ended September 2013 which is on line with our annual estimates.
· The financials had a positive impact of change due to foreign exchange rates and substantial increase in production/delivery efficiencies. For the half year ended September 2013 there is a foreign exchange gain of Rs. 315 mn as compared to a loss of Rs. 17 mn for the corresponding period in the previous year. This gain is on account of restatement of foreign currency balances as on 30 September 2013.
· The Company continues to make significant efforts to reduce its receivables to a normal cycle. Since April 2013, the Company has already collected Rs. 866 mn . We are constantly in touch with all the clients/partners/broadcasters/distributors/agents for recovery of due amounts and monies are being received from most of the clients on regular basis, thereby assuring that the clients are committed to pay. We do not foresee any issues on the recoverability of these amounts. However, our administrative costs have been impacted by a provision of INR 57mn (with a corresponding reduction in receivables) which is due from one customer, although we are hopeful of recovering this debt.
During the half year ended, the Company has repayed term loans to the extent of INR155 mn
2. Chairman's Statement:
The global entertainment industry is developing at an unprecented pace. Mobility and portability of content will, in my opinion, have a profound impact as viewers consume programming outside their homes and want to control what they watch, when they watch, and on what device . So many opportunities are evolving and we recognize that in so far as content production is important, even more vital will be the distribution technologies that are emerging.
Recognizing and serving this need with regards to distribution technology, we have made substantial and focused progress in Licensing and Distribution of our Intellectual Properties not only for television broadcast, but other VOD (Video on Demand) and SVOD (Subscription Video on Demand) & OTT (Over the Top) platforms as well. Our flagship global property Jungle Book Series is on Netflix, Vudu and Hulu - the famous OTT platforms in the USA.
New associations with leading networks and licensees globally are paving the way to monetize our IPs and co-produced content. New deals across our portfolio of properties in recent months are with best-in-class partners such as France Television, Nickelodeon, Disney Channel Productions, Sky Italia, Universal Music, Discovery Kids, Rai TV, Italy etc. The promotional deal for The Jungle Book with Burger King Worldwide has been immensely successful and will be extended for second promotion.
We have successfully completed deliveries while new productions are in development. Our foray into theatrical production of 'The Jungle Book' is gathering momentum, and we hope to conclude announceable distribution deals in the near future.
Recently, the Group concluded co-production and licensing deals worth INR 2220 mn. We remain confident that the global entertainment industry has excellent growth prospects, while our business remains well placed for projected growth in the current year."
3. Operating Highlights:
Completed projects:
1. Peter Pan Season 1- 26 x 22' 3D HD Stereoscopic TV Series with ZDF Germany, De Agostini Italy, Method Animation supported by France TV, B Channel - Indonesia, JCCTV - Middle East and Noga - Israel
On- going projects :
1. Jungle Book Season 2- 52 x 11'CGI TV series with ZDF - Germany and TF1 - France
2. Jungle Book Christmas Special- 42' CGI TV Feature, ZDF and Disney Channel
3. Robin Hood, Mischief in Sherwood- 52 x 11' CGI TV series with Method Animation and TF1 - France, ZDF - Germany, ATV - Turkey, DeA Kids - Italy
4. Lassie & Friends- 52 x 11' 2D HD TV series with Dreamworks Classic Media - USA, Super Prod & TF1 - France, ZDF - Germany
5. Lanfeust Quest- 26 x 22' CGI TV series with Gaumont Animation - France, M6 TV - France
6. NFL Rush Zone Season 3- 24 x 22' CGI & 2D TV Series with Rollman Entertainment - USA for Nicktoons
7. Little Prince Season 3- 26 x 22' CGI TV series with Method Animation, WDR - Germany, France Television, RAI TV - Italy
8. Iesodo- 10 x 13' CGI TV Series with Zaya Toonz LLC - USA
9. Manav- 1 x 60' 2D TV feature for Disney - India
New projects signed/in development:
1. Peter Pan Season 2- 26 x 22' CGI TV series with ZDF - Germany, De Agostini - Italy and Method Animation - France and France TV
2. *Yonaguni - 52 x 11' CGI TV series with Sea World - USA and Rollman Entertainment- USA
3. *7 Dwarfs & Me- 52 x 11' CGI & Live Action Hybrid Series with Method Animation - France
4. 5 & IT- 52 x 11' - CGI TV Series with ZDF Enterprises - Germany, Method Animation - France, Nick- India and Global TV - Indonesia
5. Leo & The Pisa Gang- 52 x 11' - CGI TV series with MPP Production and Penta TV - Germany
6. Raz & Benny- 52 x 11' - CGI TV series with Foothill Entertainment - USA
7. The Wind in the Willows- 52 x 11' HD TV series under development
* Have been signed/in development since the Indian subsidiary Q1 announcement on 9 August 2013
Licensing and Distribution:
Our licensing and distribution efforts have proven increasingly successful on a global scale and are helping to create long term and sustained value for DQE.
Broadcasting deals signed during the period:
S. No | Name of the licensee | Project Name | Territories |
1 | Discovery* | Robin Hood | Indian Sub- Continent Region |
2 | Nickelodeon* | The Jungle Book - 1 & 2, The Rising Star and Galactic Football | Indian Sub- Continent |
3 | Sky Italia* | Peter Pan - 1 | Italy |
4 | Rai TV* | Peter Pan - 1 | Italy |
5 | Universal Music* | Jungle Book - 2 | World Wide |
6 | 2 x 2* | Iron Man 2 | Russia |
7 | Green Narae Media* | Jungle Book 2, Peter Pan | Korea |
8 | Clearvision | Iron Man 2 | United Kingdom |
9 | Parent Media Co | Iron Man 2 | Canada |
10 | Simbasat | Iron Man 2 | French Speaking Africa |
11 | Escalada (RTM) | Jungle Book - 1, Iron Man 2 & Peter Pan | Malaysia |
12 | Univision | Jungle Book - 1 | USA & Puerto Rico |
13 | Knowledge Network | Jungle Book - 1 | British Columbia |
Merchandising deals signed during the period: The Jungle Book
S. No | Licensee | Category | Territories |
1 | Show Attraction* | Costume Character Appearance | Australia |
2 | Habuba Clip* | Toys | Israel |
3 | TRU Dubai* | Toys | Dubai |
4 | Hunter Leisure* | Toys | Australia |
5 | Prima Toys* | Toys | South Africa |
6 | Scandi Toys* | Toys | Scandinavia |
7 | Ho's Team- Shoprite* | Toys | South Africa |
8 | BBS* | Disposables and Tableware | Italy, San Marino & Vatican City |
9 | Play Wow | Inflatable bath toys | USA, Canada, Australia, New Zealand & South Africa |
10 | Inkology | Stationery items | USA & Canada |
11 | Budge Studios | Mobile App | World Wide |
12 | Techno plast | Lunch boxes, water bottles, thermo bottles, back packs, soft lunch kits, vaccum flasks | Peru, Chille |
13 | Bendon Publishing | Colouring books, activity books, story books, board books | USA & Canada |
14 | Union underwear | Boys & girls underwear separates and sets | USA & Canada |
Merchandising Deals signed - The New Adventures of Peter Pan
S. No | Name of the party | Category | Territory |
1 | Ranocchiore* | Ceramic, Procelain, Glass, Silver bi-laminate, Resin and Cardboard | Italy, San Marino, Vatican City and Italian speaking Switzerland |
2 | Tendenze srl* | Apparels | Italy, San Marino and Vatican City. |
3 | Intimage | Nightwear , Seawear, Underwear | Italy |
4 | Jungle Online | Comic Publishing | Belgium |
5 | Due In | T Shirts, Long Sleeved Shirts , Sweat Shirt & Sweat pants | Italy, San Marino,Vatican City |
6 | Cisca | Easter Eggs | Italy, San Marino,Vatican City |
7 | Libri Spa | Traditional picture books,Color Registers and activities,Pop-up books, carousel with 3 D scenarios,Toy books with puzzle or with sound /tactile/bright elements. Books "allcardboard" shaped and/or with windows or elements of cardboard furniture | Italy, San Marino,Vatican City,Italian Swithzerland |
8 | Play Press | Coloring Book, Activity Book, 3D Magic gadgets | Italy, San Marino,Vatican City, Ticinio |
9 | Flunch | QSR | France |
10 | Showtime Attractions | Costume Character Appearences | Australia & Newzealand |
11 | Nestle | Easter chocolate eggs with or without gadget, small chocolate eggs with or without gadget, mini chocolate eggs with or without eggs | Italy, San Marino, Vatican City |
* Have been signed/in development since the Indian subsidiary Q1 announcement on 9 August 2013
4. Awards and Accolades
Mr. Tapaas Chakravarti received the Life Time Achievement - Hall of Fame Award on November 3, 2013 at the World Animation and VFX summit held in California. The accolade was awarded to Tapaas for his contribution to the growth of the animation industry in India and his global outreach efforts in animation.
***
Condensed Consolidated Interim Financial Statements
DQ Entertainment plc
30 September 2013
Condensed Consolidated Income Statement
GROUP | Note | Six months ended 30 September 2013 INR'Mn | Six months ended 30 September 2012 INR'Mn |
Year ended INR'Mn |
Continuing operations | ||||
Revenue | C | 870 | 954 | 2,294 |
Cost of sales | (601) | (676) | (1,389) | |
Gross profit | 269 | 278 | 905 | |
Other operating income | 301 | 3 | 10 | |
Distribution expenses | (15) | (19) | (34) | |
Administrative expenses | (171) | (75) | (281) | |
Other operating expenses | (10) | (20) | - | |
105 | (111) | (305) | ||
Operating result before financing costs | 374 | 167 | 600 | |
Financial income | 37 | 10 | 14 | |
Financial expenses | (117) | (94) | (204) | |
Net financing costs | J | (80) | (84) | (190) |
Share of profit of associate | 2 | 16 | 17 | |
Profit before tax | 296 | 99 | 427 | |
Income tax expense | (9) | (28) | (46) | |
Profit after tax | 287 | 71 | 381 | |
Attributable to: | ||||
Owners of the Company | 214 | 61 | 296 | |
Non-controlling interests | L | 73 | 10 | 85 |
Basic and diluted earnings per share for profit attributable to the equity holders of the company during the period (expressed as cents per share) | K | |||
Basic earnings per share | 4 | 2 | 7 | |
Diluted earnings per share | 4 | 2 | 7 |
Condensed Consolidated Statement of Comprehensive Income
GROUP Notes | Six months ended 30 September 2013 INR'Mn | Six months ended 30 September 2012 INR'Mn |
Year ended INR'Mn | |
Profit after tax | 287 | 71 | 381 | |
| Other comprehensive income | ||||
Foreign Currency Translation | 580 | (16) | 16 | |
Total comprehensive income for the period / year | 867 | 55 | 397 |
Total comprehensive income attributable to:
Owners of the Company 698 58 316 |
Non-controlling interests L 169 (3) 81 |
Condensed Consolidated Statement of Financial Position
GROUP | Note | As at 30 September 2013 INR'Mn | As at 30 September 2012 INR'Mn | As at 31 March 2013 INR'Mn |
ASSETS | ||||
Non current assets | ||||
Property, plant and equipment | 202 | 384 | 290 | |
Goodwill | 432 | 432 | 432 | |
Intangible assets | E | 3,969 | 3,412 | 3,294 |
Intangible Assets under construction | F | 1,857 | 760 | 1,230 |
Investment in associate | 194 | 156 | 152 | |
Prepaid leasehold rights | 10 | 11 | 11 | |
Deferred tax asset | 57 | 21 | 60 | |
Deposits | 17 | 20 | 20 | |
Total non current assets | 6,738 | 5,196 | 5,489 | |
Current assets | ||||
Trade and other receivables | 2,682 | 2,475 | 2,379 | |
Cash and Bank balances | D | 24 | 93 | 42 |
Total current assets | 2,706 | 2,568 | 2,421 | |
Total assets | 9,444 | 7,764 | 7,910 |
Condensed Consolidated Statement of Financial Position
(continued)
GROUP | Note | As at 30 September 2013 INR'Mn | As at 30 September 2012 INR'Mn | As at 31 March 2013 INR'Mn |
EQUITY AND LIABILITIES | ||||
EQUITY | ||||
Issued capital | M | 5 | 3 | 4 |
Share Premium | 2,816 | 2,516 | 2,616 | |
Reverse acquisition reserve | 55 | 55 | 55 | |
Capital Redemption Reserve | 1 | 1 | 1 | |
Foreign currency translation reserve | 708 | 201 | 224 | |
Retained earnings | 1,536 | 1,087 | 1,322 | |
Equity attributable to owners of the Company | 5,121 | 3,863 | 4,222 | |
Non-controlling interests | L | 1,242 | 989 | 1,073 |
Total equity | 6,363 | 4,852 | 5,295 | |
Non current liabilities | ||||
Interest-bearing loans and borrowings | G | 869 | 552 | 719 |
Provisions | 143 | 123 | 131 | |
Total non current liabilities | 1,012 | 675 | 850 | |
Current liabilities | ||||
Trade and other payables | 692 | 1,122 | 690 | |
Bank overdraft | D | 892 | 418 | 666 |
Interest-bearing loans and borrowings | G | 456 | 665 | 379 |
Provisions | 29 | 32 | 30 | |
Total current liabilities | 2,069 | 2,237 | 1,765 | |
Total liabilities | 3,081 | 2,912 | 2,615 | |
Total stockholders' equity and liabilities | 9,444 | 7,764 | 7,910 |
These financial statements were approved by the Board of Directors and authorised for use on 15November 2013.
Signed on behalf of the Board of Directors by:
Director Director
Condensed Consolidated Statement of Changes in Equity for the period ended 30 September 2013
GROUP | Equity shares - No of Shares | Equity Shares - Amount INR'Mn | Share premium INR'Mn | Reverse acquisition reserve INR'Mn | Foreign currency translation reserve INR'Mn | Capital Redemption Reserve INR'Mn | Retained earnings INR'Mn | Attributable to owners of the Company INR'Mn | Non controlling interests INR'Mn | Total INR'Mn | ||
Balance as at 1 April, 2012 | 35,966,047 | 3 | 2,516 | 55 | 204 | 1 | 1,026 | 3,805 | 992 | 4,797 | ||
Changes in equity for the year ended 31 March, 2013 | ||||||||||||
Issue of Shares | 6,600,000 | 1 | - | - | - | - | - | 1 | - | 1 | ||
Premium on Issue of shares | - | - | 100 | - | - | - | - | 100 | - | 100 | ||
Other Comprehensive Income | 20 | 20 | (4) | 16 | ||||||||
Income for the Year | - | - | - | - | - | - | 296 | 296 | 85 | 381 | ||
Balance as at 31 March, 2013 | 42,566,047 | 4 | 2,616 | 55 | 224 | 1 | 1,322 | 4,222 | 1,073 | 5,295 | ||
Changes in equity for the six months ended 30 September 2013 | ||||||||||||
Issue of shares during the period | 13,697,000 | 1 | - | - | - | - | - | 1 | - | 1 | ||
Premium on Issue of Shares | - | - | 200 | - | - | - | - | 200 | - | 200 | ||
Other comprehensive income | - | - | - | - | 484 | - | - | 484 | 96 | 580 | ||
Income for the period | - | - | - | - | - | - | 214 | 214 | 73 | 287 | ||
Balance as at 30 September 2013 | 56,263,047 | 5 | 2,816 | 55 | 708 | 1 | 1,536 | 5,121 | 1,242 | 6,363 | ||
Balance as at 1 April, 2011 | 35,966,047 | 3 | 2,516 | 55 | 137 | 1 | 745 | 3457 | 891 | 4348 | ||
Changes in equity for the year ended 31 March 2012 | ||||||||||||
Other Comprehensive Income | - | - | - | - | 67 | - | - | 67 | 24 | 91 | ||
Income for the Year | - | - | - | - | - | - | 281 | 281 | 77 | 358 | ||
Balance as at 31 March, 2012 | 35,966,047 | 3 | 2516 | 55 | 204 | 1 | 1026 | 3805 | 992 | 4797 | ||
Changes in equity for the six moths ended 30 September 2012 | ||||||||||||
Other Comprehensive Income | - | - | - | - | (3) | - | - | (3) | (13) | (16) | ||
Income for the period | - | - | - | - | - | - | 61 | 61 | 10 | 71 | ||
Balance as at 30 September 2012 | 35,966,047 | 3 | 2516 | 55 | 201 | 1 | 1087 | 3863 | 989 | 4852 | ||
Condensed Consolidated Statement of Cash Flows for the period ended 30 September 2013
GROUP | Note | Six months ended 30 September 2013 INR'Mn | Six months ended 30 September 2012 INR'Mn |
Year ended INR'Mn |
Cash flows from operating activities | ||||
Profit for the period before tax | 296 | 99 | 427 | |
Adjustments for: | ||||
Depreciation and amortization | 187 | 181 | 526 | |
Financial income | J | (37) | (10) | (14) |
Financial expenses | J | 117 | 94 | 204 |
Provisions for employee benefits | 20 | 27 | 39 | |
Provision for retakes | H | (1) | (2) | (7) |
Loss/(gain)on foreign exchange fluctuations | (301) | 13 | (17) | |
Share of gain of associate | (2) | (16) |
(17) | |
(Gain) / Loss on sale of property, plant and equipment | (3) | 1 | 5 | |
Operating cash flows before changes in working capital | 276 | 387 | 1,146 | |
Decrease /(Increase) in trade and other receivables | 72 | (545) | (764) | |
Employee benefits paid | (7) | (6) | (6) | |
(Decrease)/increase in trade and other payables | 8 | 42 | 50 | |
349 | (122) | 426 | ||
Income taxes paid | - | (12) | (21) | |
Net cash generated from / (used in) operating activities | 349 | (134) | 405 | |
Condensed Consolidated Statement of Cash Flows for the period ended 30 September, 2013 (continued)
GROUP | Note | Six months ended 30 September 2013 INR'Mn | Six months ended 30 September 2012 INR'Mn |
Year ended INR'Mn |
Cash flows from investing activities | ||||
Acquisition of property, plant and equipment | (1) | (18) | (47) | |
Acquisition and advances paid for distribution rights | (807) | (205) | (1,136) | |
Proceeds from sale of property, plant and equipment | 5 | 4 | 1 | |
Sale of Investment in Mutual Funds | - | 61 | 61 | |
Financial assets at fair value through | - | - | 7 | |
Deposits | (12) | - | (1) | |
Finance income | 5 | 23 | 14 | |
Net cash used in investing activities | (810) | (135) | (1,101) | |
Cash flows from financing activities | ||||
Proceeds from Borrowings from Term Loans | 307 | 243 | 412 | |
Repayment of Term Loans | (155) | (496) | (558) | |
Issue of share capital | 1 | - | 1 | |
Premium collected on issue of shares | 200 | - | 100 | |
Interest paid | (115) | (91) | (188) | |
Net cash generated from /(used in) financing activities | 238 | (344) | (233) | |
Net decrease in cash and cash equivalents | (223) | (613) | (929) | |
Cash and cash equivalents at beginning of period | 43 | 645 | 645 | |
Bank overdraft at beginning of period | (666) | (311) | (311) | |
Gain / (Loss) on foreign exchange fluctuations | (22) | (46) | (29) | |
Cash and Cash equivalents at the end of period / year | D | (868) | (325) | (624) |
Notes to Condensed Consolidated Financial Statements
NOTE A - BASIS OF PREPARATION
1. General information
DQ Entertainment plc (the 'Company' or "DQ plc") is a company domiciled and incorporated in the Isle of Man on19 April 2007 and was admitted to the Alternative Investment Market of London Stock Exchange on 18 December 2007. The Company raised approximately INR 2,147Mn at listing (before Admission costs).
The condensed consolidated financial statements of the Company for the six months period ended 30 September 2013, comprises the financial Information of the Company, its subsidiaries and associate (together referred to as the 'Group').
As at 30 September 2013 the following companies formed part of the Group:
Company | Immediate Parent | Country of Incorporation | % of Interest |
Subsidiaries | |||
DQ Entertainment (Mauritius) Limited (DQM) | DQ Entertainment Plc | Mauritius | 100 |
DQ Entertainment (International) Limited (DQ India) was formerly known as "Animation and Multimedia Private Limited" | DQ Entertainment (Mauritius) Limited | India | 75 |
DQ Entertainment (Ireland) Limited ( DQ Ireland) | DQ Entertainment (International) Limited | Ireland | 100 |
DQ Entertainment Films (International) Limited | Joint Venture Company by DQ India and DQ Plc | Ireland | 100 |
DQ Power Kidz Private Limited | DQ Entertainment (International) Limited | India | 100 |
Associate | |||
Method Animation SAS | France | 20 | |
The Company's registered address is 33-27, Athol Street, Douglas, IM ILB, Isle of Man.
The Group is primarily engaged in the business of providing traditional and digital animation for television, home video and feature films. The Group also is engaged in exploitation of its distribution rights to broadcasters, television channels, home video distributors and others.
The functional currencies of the respective Group companies are:
DQplc | British Pound (GBP) |
DQM | US Dollar (USD) |
DQIndia | Indian Rupee (INR) |
DQ Ireland | Euro (EURO) |
DQ Films Ltd | Euro (EURO) |
DQ Power Kidz | Indian Rupee (INR) |
Method Animation SAS | Euro (EURO) |
NOTE B - STANDARDS AND INTERPRETATIONS NOT YET APPLIED
The following new Standards and Interpretations, which are yet to become mandatory, have not been applied in the Company's Financial Statements.
Standard or Interpretation | Effective for reporting periods starting on or after | |
IFRS -7 | Amendments related to the offsetting of assets and liabilities | Annual periods beginning on or after 1 January 2013 and interim periods within those periods |
IFRS -9 | Reissue to include requirements for the classification and measurement of financial liabilities and incorporate existing derecognition requirements | Annual periods beginning on or after 1 January 2013 |
IFRS 9 | Financial instruments-classification and measurement of Financial assets | Annual periods beginning on or after 1 January 2015 |
IFRS -10 | Consolidated Financial Statements | Annual periods beginning on or after 1 January 2013 |
IFRS 11 | Joint Arrangements | Annual periods beginning on or after 1 January 2013 |
IFRS -12 | Disclosure of interests in other entities | Annual periods beginning on or after 1 January 2013 |
IFRS -13 | Fair Value Measurement | Annual periods beginning on or after 1 January 2013 |
IAS-1 | Presentation of financial statements - Amendments to revise the way other comprehensive income in presented | Annual periods beginning on or after 1 July 2012 |
IAS-12 | Income taxes on deferred tax | Annual periods beginning on or after 1 January, 2012 |
IAS -19 | Amended standard resulting from the post-employment benefits and termination benefits projects | Annual periods beginning on or after 1 January 2013 |
IAS-27 | Consolidated and separate financial statements - reissued as IAS 27 separate financial statements(as amended in 2011) | Annual periods beginning on or after 1 January 2013 |
IAS -28 | Investments in Associates and Joint Ventures | Annual periods beginning on or after 1 January 2013 |
IAS-34 | Interim Finacial reporting - Amendments resulting from May 2010 annual improvements to IFRS | Annual period beginning on or after 1 January 2011 |
IAS-32 | Offsetting financial assets and financial liabilities | Annual period beginning on or after 1 January 2014 |
IAS-36 | Impairment of Assets - Amendments arising from recoverable amount disclosures for non-financial assets | Annual period beginning on or after 1 January 2014 |
Based on the Company's current business model and accounting policies, management does not expect any material impact on the Company's financial statements when any of the other standards or interpretations becomes effective.
The Company does not intend to apply any of these pronouncements early.
1. Significant accounting policies
The condensed consolidated interim financial information should be read in conjunction with the annual financial statements for the year ended 31 March, 2013, which have been prepared in accordance with International Financial Reporting Standards ('IFRS's)
In the opinion of management, all adjustments, which are of a normal recurring nature and necessary for a fair presentation, have been included. The Company has chosen to present the condensed consolidated financial position & condensed consolidated income statement, condensed consolidated comprehensive income statement, condensed consolidated statement of cash flows and condensed consolidated statement of changes in equity along with selected explanatory notes. Accordingly, certaininformation and note disclosures normally included in annual financial statements prepared in accordance with IFRS have been condensed or omitted, although the Company believes that the disclosures made are adequate to make the information presented not misleading. These condensedconsolidated financial statements have been prepared using the same accounting policies that were applied in the preparation of the Company's annual consolidated financial statements for the year ended 31 March, 2013.
The directors have had regard to the 12 month period from the date of approval of the interim financial statements and have reviewed the forecasted cash flows. The Company has sufficient resources to meet its on-going liabilities as they fall due.
NOTE C - SEGMENT REPORTING
Segment information is presented in respect of the Group's business and geographical segments. The primary format, business segments, is based on the Group's management and internal reporting structure.
Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated items comprise mainly interest-bearing loans, borrowings and expenses, and corporate assets and expenses.
Segment capital expenditure is the total cost incurred during the period to acquire segment assets that are expected to be used for more than one period.
Business segments
The Company comprises the following main business segments:
Animation production:
The production services rendered to production houses and training rendered for acquiring skills for production services in relation to the production of animated television series and movies.
Distribution:
The revenue generated from the exploitation of the distribution rights of animated television series.
The following is an analysis of the Company's revenue and results by operating segment for the periods under review:
Segment Revenue | Segment Result | |||||
GROUP | Six months ended 30 September 2013 INR'Mn | Six months ended 30 September 2012 INR'Mn | Year ended 31 March 2013 INR'Mn | Six months ended 30 September 2013 INR'Mn | Six months ended 30 September 2012 INR'Mn | Year ended 31 March 2013 INR'Mn |
Animation Production | 692 | 703 | 1,819 | 389 | 278 | 987 |
Distribution | 178 | 251 | 475 | 76 | 140 | 120 |
Total | 870 | 954 | 2,294 | 465 | 418 | 1,107 |
Unallocated Expenses | (169) | (319) | (680) | |||
Profit before tax | 296 | 99 | 427 | |||
Income tax expense | (9) | (28) | (46) | |||
Profit for the period/year | 287 | 71 | 381 | |||
NOTE D - CASH AND CASH EQUIVALENTS
30 September 2013 INR'Mn | 30 September 2012 INR'Mn | 31 March 2013 INR'Mn | |
Cash and bank balances | 7 | 77 | 26 |
Call deposits | 17 | 16 | 16 |
Cash and bank balances | 24 | 93 | 42 |
Bank overdraft | (892) | (418) | (666) |
Cash and cash equivalents in the statement of cash flows | (868) | (325) | (624) |
NOTE E - INTANGIBLE ASSETS
GROUP | 30 September 2013 INR'Mn | 30 September 2012 INR'Mn | 31 March 2013 INR'Mn |
Cost | |||
Opening balance | 4,254 | 3,720 | 3,720 |
Acquisitions/Transfer from Assets under Construction/Recoupment | 289 | 383 | 529 |
Disposals | (65) | - | - |
Translation adjustment | 528 | 9 | 5 |
Closing balance | 5,006 | 4,112 | 4,254 |
Amortisation | |||
Opening balance | 960 | 604 | 604 |
Amortisation expense | 110 | 96 | 218 |
Impairment losses recognised in profit or loss | - | - | 134 |
Impairment reversed on disposal | (65) | - | - |
Translation adjustment | 32 | - | 4 |
1,037 | 700 | 960 | |
Carrying amounts | |||
At beginning of period/year | 3,294 | 3,116 | 3,116 |
At end of period/year | 3,969 | 3,412 | 3,294 |
NOTE F - INTANGBILE ASSETS UNDER CONSTRUCTION
Intangible assets under construction include amounts paid to the producers for acquisition of the distribution rights and amounts incurred on internally generated intellectual property rights pending for capitalisation. These advances are transferred to distribution rights on completion of the entire production activities and when the asset is ready for exploitation.
GROUP | 30 September 2013 INR'Mn | 30 September 2012 INR'Mn | 31 March 2013 INR'Mn |
Opening balance | 1,230 | 751 | 751 |
Acquisitions | 495 | 513 | 974 |
Transfers to intangible assets | (123) | (300) | (475) |
Translation adjustment | 255 | (204) | (20) |
Closing balance | 1,857 | 760 | 1,230 |
NOTE G - INTEREST BEARING LOANS AND BORROWINGS
Interest bearing loans and borrowings comprise the following:
GROUP | 30 September 2013 INR'Mn | 30 September 2012 INR'Mn | 31 March 2013 INR'Mn |
Non-current liabilities: | |||
Secured bank loans | 869 | 551 | 719 |
Finance lease liabilities | - | 1 | - |
869 | 552 | 719 | |
Current liabilities: | |||
Current portion of secured bank loans | 455 | 663 | 379 |
Finance lease liabilities | 1 | 2 | - |
456 | 665 | 379 |
NOTE H - PROVISION FOR RETAKES
GROUP | 30 September 2013 INR'Mn | 30 September 2012 INR'Mn | 31 March 2013 INR'Mn |
Opening balance | 21 | 28 | 28 |
Provisions made during the period/ year | 9 | 9 | 17 |
Provisions used during the period/ year | - | - | (1) |
Provisions reversed during the period/ year | (10) | (11) | (23) |
Closing balance | 20 | 26 | 21 |
Retakes include creative changes to the final product delivered to the customer, performed on the specific request of the customer at the Group's own cost. Requests for retakes will be accepted from customers by the Group for a maximum period of three months from the final delivery and hence the provision is not discounted.
NOTE I - PERSONNEL COSTS
Details of personnel expenses included in cost of sales, administrative and distribution expenses
are as follows:
GROUP | 30 September 2013 INR'Mn | 30 September 2012 INR'Mn | 31 March 2013 INR'Mn |
Wages and salaries | 354 | 398 | 777 |
Contributions to defined contribution plans | 24 | 28 | 54 |
Increase in liability for defined benefit plans | 8 | 17 | 29 |
Increase in liability for compensated absences | 12 | 9 | 10 |
398 | 452 | 870 |
Cost of sales | 389 | 444 | 757 |
Administrative expenses | 7 | 5 | 107 |
Distribution Expenses | 2 | 3 | 6 |
NOTE J - NET FINANCING COSTS
GROUP | 30 September 2013 INR'Mn | 30 September 2012 INR'Mn | 31 March 2013 INR'Mn |
Interest income | 37 | 10 | 14 |
Financial income | 37 | 10 | 14 |
Interest on short term borrowings and other financing costs | (60) | (52) | (97) |
Interest on term loans | (57) | (42) | (107) |
Financial expenses | (117) | (94) | (204) |
Net financing costs | (80) | (84) | (190) |
NOTE K - EARNINGS PER SHARE ("EPS")
Profit attributable to ordinary shareholders
30 September 2013 INR'Mn | 30 September 2012 INR'Mn | 31 March 2013 INR'Mn | |
Profit attributable to ordinary shareholders | 214 | 61 | 296 |
Weighted average number of ordinary shares outstanding during the period(in thousand) | 55,426 | 35,966 | 42,331 |
Basic EPS (Cents) | 4 | 2 | 7 |
Diluted EPS (cents) | 4 | 2 | 7 |
The Group does not have any dilutive instruments for any of the periods ended 30 September 2013 or
30 September 2012 and for the year ended 31 March, 2013 and as such Diluted EPS equals Basic EPS.
NOTE L - NON - CONTROLLING INTERESTS
30 September 2013 INR'Mn | 30 September 2012 INR'Mn | 31 March 2013 INR'Mn | |
Balance at beginning of period/year | 1,073 | 992 | 992 |
Profit for the period | 73 | 10 | 85 |
Other comprehensive income for the period/year | 96 | (13) | (4) |
Closing balance | 1,242 | 989 | 1,073 |
NOTE M - EQUITY
a) Ordinary shares
DQ plc presently has only one class of ordinary shares. For all matters submitted to vote in the shareholders' meeting, every holder of ordinary shares, as reflected in the records of the Company on the date of the shareholders' meeting, has one vote in respect of each share held. All shares are equally eligible to receive dividends and the repayment of capital in the event of liquidation of the Company.
The Company has an authorized share capital of 60,000,000 equity shares of 0.1 pence each.
Issue of ordinary shares
30 September 2013 | 30 September 2012 | 31 March 2013 | |
Number of shares | |||
Opening balance Issued for cash | 42,566,047 | 35,966,047 | 35,966,047 |
13,697,000 | - | 6,600,000 | |
Closing balance | 56,263,047 | 35,966,047 | 42,566,047 |
30 September 2013 INR'Mn | 30 September 2012 INR'Mn | 31 March 2013 INR'Mn | ||||
Share capital | ||||||
Opening balance | 4 | 3 3 | ||||
Issued for cash | 1 | - 1 | ||||
Closing balance | 5 | 3 4 | ||||
NOTE M - EQUITY(Continued)
Share premium- The amount received by the company over and above the par value of shares issued is shown under this heading.
30 September 2013 INR'Mn | 30 September 2012 INR'Mn | 31 March 2013 INR'Mn | ||||||
Share premium | ||||||||
Opening Balance | 2,616 | 2,516 | 2,516 | |||||
Issued for cash | 200 | - | 100 | |||||
Closing Balance | 2,816 | 2,516 | 2,616 | |||||
The share premium reserve can be utilised by the Company for the declaration of bonus shares and for offsetting incremental costs directly attributable to the issues of new shares.
b) Reserves
Translation reserve- Assets, liabilities, income, expenses and cash flows are translated into Indian Rupees (presentation currency) from US Dollars (functional currency of DQ Mauritius),
Euros (functional currency of DQ Ireland and DQ Films Ltd) and Great British Pounds (functional currency of DQ Plc). The exchange difference arising out of the period-end translation is debited or credited to foreign currency translation reserve.
The movements in this reserve which are attributable to the controlling interests are set out below:
30 September 2013 INR'Mn | 30 September 2012 INR'Mn | 31 March 2013 INR'Mn | |
Opening balance | 224 | 204 | 204 |
Increase/(Decrease) during the period | 484 | (3) | 20 |
Closing balance | 708 | 201 | 224 |
Exchange differences relating to the translation of the net assets of the Group's foreign operations from
their functional currencies to the Group's presentation currency (i.e. INR) are recognised directly in
other comprehensive income and accumulated in the foreign currency translation reserve.
Accumulated earnings- Accumulated earnings include all current and prior period results as disclosed in the income statement which are attributable to the controlling interests. The movements in the accumulated earnings are set out below:
30 September 2013 INR'Mn | 30 September 2012 INR'Mn | 31 March 2013 INR'Mn | |
Opening balance | 1,322 | 1,026 | 1,026 |
Profit for the period | 214 | 61 | 296 |
Closing balance | 1,536 | 1,087 | 1,322 |
Other Reserves - The Reverse Acquisition Reserve, Equity component of convertible instruments and
Capital Redemption Reserve are non distributable in nature.
NOTE N - CAPITAL COMMITMENTS AND CONTINGENT LIABILITIES
GROUP | 30 September 2013 INR'Mn | 30 September 2012 INR'Mn | 31 March 2013 INR'Mn |
Capital commitments: | |||
Purchase of property, plant and equipment | - | 3 | - |
Purchase of distribution rights | 918 | 411 | 1,044 |
Contingent liabilities: | |||
Outstanding letters of credit for capital investments | 917 | 700 | 777 |
Bonds executed in favour of Indian customs and excise authorities | 3 | 2 | 3 |
Claims not acknowledged as debts | 10 | 10 | 10 |
NOTE O - RELATED PARTIES
Identity of related parties
DQ plc has a related party relationship with its directors, executive officers, subsidiaries and associate.
DQ plc does not have any ultimate controlling entity.
Related parties and their relationships
a) Subsidiaries
DQ Entertainment (Mauritius) Limited
DQ Entertainment (International) Limited
DQ Entertainment (Ireland) Limited
DQ Entertainment (International) Films Limited
DQ Power Kidz Private Limited
Associate
Method Animation
RELATED PARTIES -
b) Key management personnel
Mr. Tapaas Chakravarti - Director
Mr. K. Balasubrahmanyam - Director
Ms. Theresa Plummer - Director
Ms.Rashida Adenwala - Director
c) Relatives of Key Management Personnel with whom DQ India had transactions during the year - Mrs. Rashmi Chakravarti (wife of Mr. Tapaas Chakravarti)
d) Ms Nivedita Chakravarti (daughter of Mr.Tapaas Chakravarti)
e) Mr Hatim Adenwala - Senior Vice President Human Resources (Husband of Rashida Adenwala)
RELATED PARTIES (Continued)
Trading transactions
Transactions between the Company and its subsidiaries, which are related parties of the Company, have been eliminated on consolidation and are not disclosed in this note. Details of transactions between the Group and other related parties are disclosed below.
Revenue from Animation | Amounts owed by /(to) related party | Revenue from Animation | Amounts owed by/ (to) related party | Revenue from Animation | Amounts owed by/(to) related party | |
30 September 2013 INR'Mn | 30 September 2013 INR'Mn | 30 September 2012 INR'Mn | 30 September 2012 INR'Mn | 31 March 2013 INR'Mn | 31 March 2013 INR'Mn | |
Associate | 53 | 319 | 161 | 258 | 215 | 292 |
Revenue from production from related parties was at prices arising out of the Group's usual trade practices. The amounts outstanding are unsecured and will be settled in cash. No guarantees have been given or received. No expense has been recognised in the period for bad or doubtful debts in respect of the amounts owed by related parties.
Compensation of key management personnel
Directors of the company and their immediate relatives control 14.47 per cent of the voting shares of the company.
The remuneration of directors and other members of key management during the period were as follows:
30 September 2013 INR'Mn | 30 September 2012 INR'Mn | 31 March 2013 INR'Mn | |
Short term benefits | 18 | 14 | 35 |
Other related party transactions
Remuneration paid to relatives of key management personnel during the period was INR 4 Mn
30 September 2012: 4 Mn; 31 March 2013: INR 8 Mn)
Contact:
DQE Tapaas Chakravarti - Chairman & CEO tapaas@dqentertainment.com Rashida Adenwala - Director Finance & Investor Relationsrashida@dqentertainment.com | Tel: +91 40 235 53726/27 |
Allenby Capital Limited - AIM Nominated Adviser & Broker Jeremy Porter / Alex Price | Tel: +44(0) 20 3328 5656 |
Buchanan | Tel: +44 (0)20 7466 5000 |
This information is provided by RNS
|
distributed by
|
