Papa Entertainment PLC
LSE : PAPP

August 30, 2013 02:00 ET

Final Results

                                                 
                                                                                        30 August 2013

                                      Papa Entertainment plc
                                                 
                              ("Papa Entertainment" or the "Company")
                                                 
                                           Final Results

Papa  Entertainment  Plc  (ISDX:  PAPP), a specialist UK group focused  on  the  music  and  media
industries, today announces its final audited results for the 15 month period ended 31 March  2013
(the "Period").

Highlights

- Revenues for the Period totalled £31k (16 months to 31 December 2011: £2k)
- Loss for the Period after taxation was £969k (16 months to 31 December 2011: £234k)
- Successful debut of 'Raiding the Rock Vault' at the Mayan Theatre in Los Angeles
- Contract secured with Las Vegas Hotel for 'Raiding the Rock Vault'

Commenting   on  the  preliminary  results,  Korda  Marshall,  Non-Executive  Chairman   of   Papa
Entertainment  plc,  said:  "We are pleased to be able to report our  maiden  set  of  Preliminary
Results since being successfully admitted to the ISDX.  In the Period, the Company has made strong
progress in moving forward the 'Raiding the Rock Vault' show which we debuted in LA last November.
Earlier this year, we secured the Showroom at the Las Vegas Hotel, formerly the Hilton, and we are
delighted  to  report  that  post  the Period end, 'Raiding the  Rock  Vault'  has  surpassed  our
expectations  to  become, as listed by the Trip Advisor website, the No. 2 in the performances  in
Las Vegas section, behind Jersey Boys."

     The Directors of the Company accept responsibility for the contents of this announcement.

                                             - Ends -

For further information, please contact:
Papa Entertainment plc                                                                            
Harry Cowell, Chief Executive                                            Tel: +44 (0) 20 8977 0632
                                                                      www.papaentertainmentplc.com

SVS Securities Plc                                                                                 
Alexander Brearley                                                        Tel: +44 (0) 20 7638 5600
                                                                              www.svssecurities.com

Media enquiries:
Abchurch                                                                                          
Henry Harrison-Topham / Joanne Shears                                    Tel: +44 (0) 20 7398 7709
joanne.shears@abchurch-group.com                                            www.abchurch-group.com

Notes to Editors

Papa  Entertainment  was  incorporated as a vehicle for the  purpose  of  acquiring  companies  or
businesses  engaged in the entertainment, music and media industries. Papa Entertainment  acquired
Mission Entertainment Group Limited and its subsidiaries (the "Mission Group") in July 2012.  Papa
Entertainment  is led by its Chief Executive Officer, "Sir" Harry Cowell, who has over  25  years'
experience in the music industry.

The  Company's Non-Executive Chairman is Korda Marshall, who has during his career signed artists,
directed major label A&R departments, produced, executive produced and been a managing director of
three  recording  companies and has worked with performers including Take That,  MUSE,  Ash,  Paul
Oakenfold, the Eurythmics, Dave Stewart, Peter Andre, Garbage, James Blunt, Gnarls Barkley and The
Darkness,  personally  signing  or negotiating with several of these  artists.   Korda's  signings
include Mercury Music Prize winning band Alt-J.

Simon  Napier-Bell, a Non-Executive Director of Papa Entertainment, has enjoyed a long  career  in
the  entertainment  industry,  commencing in the 1960s,  with  notable  highlights  including  the
management of well-known artists such as "Wham!" and the "Yardbirds" and the co-writing of the No.
1 Hit Single "You don't have to say you love me" for Dusty Springfield.

The  Mission Group is a group of music production and publishing companies with studio and  office
facilities  in Kingston-Upon-Thames, South West London.  The Mission Group's business consists  of
the   delivery  of  music  to  the  listener,  incorporating  writing,  recording,  marketing  and
distribution, label management and production.  The Company's policy through concentrating all the
Group's operations under one roof and utilising its own studios is to consolidate the functions of
music production and publishing in-house in order to manage costs and to integrate functions  that
would  otherwise  be  subject to external contracting. Various contracts,  artists,  projects  and
agreements  are signed to the Mission Group's companies.  Papa Entertainment was admitted  to  the
ISDX  Growth  Market  on  14 September 2012.  For more information on the  Company  please  visit:
www.papaentertainmentplc.com.

Chairman and Chief Executive's Statement

On  behalf of Papa Entertainment, a specialist UK group focused on the music and media industries,
we  are  delighted to present our maiden preliminary results since the Company successfully joined
the ISDX on 14 September 2012.

Financial Review

Turnover  for  the Period ended 31 March 2013 was £31,283 (16 months to 31 December 2011:  £1,856)
and the loss after taxation was £969,799 (16 months to 31 December 2011: loss of £233,773).  As at
31 March 2013, cash on the balance sheet was £144,601 (as at 31 December 2011: £6,989).

Raiding the Rock Vault ("RTRV")

The  first  classic  rock  concert of the Rock Vault project, 'Raiding the  Rock  Vault',  debuted
successfully  on 29 November 2012 at The Mayan Theatre in Los Angeles.  The one and  a  half  hour
long  concert  narrates the story of classic rock and features songs by The Who, The  Doors,  Jimi
Hendrix, Free, The Eagles, Led Zeppelin, Bryan Adams, Van Halen, Deep Purple, Queen, Kiss and  The
Rolling Stones.

In  January  2013,  the Company secured a one year contract with the Las Vegas  Hotel  and  Casino
("LVH") (formerly the Hilton), to perform the RTRV concerts in the hotel's Showroom.  The Showroom
seats  approximately  1,500 and the hotel has 2,956 rooms and 305 suites in total.   The  contract
with  LVH  was  structured so that the Company receives 100% of the net  gate  fee  for  the  RTRV
concerts.  The first concert at the LVH was performed on 18 March 2013.

In  relation  to  the  RTRV  project in the U.S., the Company established  two  U.S.  incorporated
subsidiaries.  "Rock Vault Tours Inc" is Papa Entertainment's subsidiary which produces  the  RTRV
concerts  and  is the subsidiary which has entered into the agreement with the LVH.   "Rock  Vault
Inc"  is  Papa  Entertainment's  subsidiary established  for  holding  the  intellectual  property
associated  with the Rock Vault Project.  Rock Vault Inc is also to be the company  through  which
Papa  Entertainment intends to conduct its Rock Vault merchandising opportunities. Both Rock Vault
Tours Inc and Rock Vault Inc are 100% owned by Papa Entertainment.

Since the 18 March 2013, the RTRV band has now performed over 100 concerts in the Showroom of  the
LVH.   The Directors estimate that attendances at these concerts have ranged from over 300  to  in
excess of 1,000 audience members.

Papa  Entertainment has been conducting merchandising activities in relation to the RTRV concerts,
which has principally involved the sale of branded items, such as t-shirts, CD albums, posters and
signed guitars.

In addition to the normal RTRV shows, the band has also been performing certain 'one-off' concerts
with  special guest musicians and vocalists, under the name of the "RTRV Icon Series". This format
introduces  well  recognised artists to sing with the RTRV band for a number of nights  which  are
heavily  promoted.  The first of these iconic guest acts to perform back in April 2013  was  Bobby
Kimball,  the former lead singer of US rock band Toto.  In May 2013, Joe Lynn Turner, formerly  of
Deep  Purple  performed  and  he was soon followed by Mickey Thomas, the  former  lead  singer  of
Starship in July 2013.

Going  forward  the  "Icon Series" has secured the services of Jon Anderson, the  English  singer-
songwriter  and  multi-instrumentalist musician best known as the original lead  vocalist  in  the
progressive  rock band Yes, to perform for five nights in September 2013.  This has  been  swiftly
followed  by Lou Gramm, best known as a former lead vocalist of the hard rock band Foreigner,  who
has agreed to perform for five nights in October 2013.

RTRV  believes that the "Icon Series" has and will continue to assist in driving further  footfall
to  the  already successful RTRV show at the LVH and in turn increase the shows' standing  in  Las
Vegas whilst improving revenues taken through ticketing and merchandise sales.

Since RTRV was launched at the LVH on 18 March 2013, the show has performed well on a limited  and
well  managed budget.  According to Trip Advisor, RTRV is the Number 2 ranked performance  out  of
180 in Las Vegas (No.1 being Jersey Boys) and ranked Number 5 out of 526 attractions in Las Vegas.
The show continues to grow and is moving steadily towards becoming cash flow positive on a monthly
basis.

Mission Entertainment Group Limited

Separate from the 'Rock Vault' project, on 24 July 2012 the Company acquired music production  and
publishing company, Mission Entertainment Group Limited ("Mission Group").  Since the acquisition,
good  progress  has  been made and the Company is pleased to report that two  of  Mission  Group's
recording acts are due to release music singles.  The first single which is due for release on  15
September  2013  and  the video will debut on Vevo on 29 August 2013, is by a UK-based  dance  act
called "Dirty Sneekers UK" and is called "The Sound", which has been entirely written and produced
by  the team at Mission Group.  The song features British reggae music artist, Sweetie Irie, whose
past collaborations include world famous bands like the Gorillaz and No Doubt.  The second Mission
Group  music single due for release in Q4 2013 is the latest single for UK rapper Ayo Beatz, which
will feature a number of different club remixes.

Earlier  in 2013 Mission Group released the debut single for UK hip-hop artist Cameron Whiley  who
is signed to Mission Recordings and Mission Publishing; the single was called "Reh Reh Reh".

In  June  2013, the Company's subsidiary Mission Publishing Limited ("MPL"), entered into a  joint
publishing venture with Notting Hill Music (UK) Limited ("NHM").  NHM is part of the international
Notting Hill Music Group.  During the term of the Joint Publishing Venture, MPL will grant NHM the
exclusive "first look" rights to publish or sub-publish writers introduced by MPL.

The  Joint  Publishing Venture is to be for an initial term of two years, with  an  option  to  be
extended  for  a  further two years, subject to the achievement of a financial milestone.   Income
earned from the publishing rights of writers introduced to the Joint Publishing Venture is  to  be
shared  equally  between  MPL and NHM.  It is intended that the agreements  entered  into  between
writers and MPL and NHM under the Joint Publishing Venture will be for a term of 15 years,  unless
agreed otherwise.

The  Directors  believe  that this Joint Publishing Venture should act as a  replacement  for  the
Company's previous publishing joint venture arrangements with Imagem CV.

Mission  Group  has  also  recently completed a modernisation programme of  its  recording  studio
facilities at the Fairlight Mews Studios in Kingston-upon-Thames.  The completion of this  upgrade
now means that Mission Group's artists can now utilise modern, up to date recording facilities  to
produce their tracks for release.

Outlook

RTRV  has,  on  an  extremely  limited budget when compared to other Las  Vegas  shows,  become  a
successful  and  well  recognised show in Las Vegas.  The show continues to  grow  and  is  moving
steadily towards becoming cash flow positive on a monthly basis.  The Board will then look at  the
possibility of launching, in addition to the Las Vegas show, a touring RTRV band to produce a  new
revenue stream for the Company.

Whilst  the majority of the Company's focus has been on the successful launch of the RTRV  project
in Las Vegas, good progress has also been made at Mission Group.  The Board believes that it has a
number  of  exciting  new artists who are due to release singles shortly  and  the  Company  looks
forward to updating the market as to how these artists perform.

The Board views the future with optimism.

Korda Marshall                                                                        Harry Cowell
Chairman                                                                           Chief Executive
29 August 2013                                                                      29 August 2013

Consolidated Profit and Loss Account
For the Period ended 31 March 2013
                                                                                           Pro forma
                                                                          15 month          16 month
                                                                      period ended      period ended
                                                                          31 March       31 December
                                                                              2013              2011
                                                           Note                  £                 £
                                                                                      
                                                           
Turnover                                                     2              31,283             1,856

Cost of sales                                                            (230,837)          (43,235)
                                                                    --------------------------------
Gross profit                                                             (199,554)          (41,379)
                                                                    --------------------------------
----------------------------------------------------------------------------------------------------                         
Administrative expenses                                                  (480,067)         (192,394)
                                                            
Deemed cost of listing                                       3           (278,969)                 -
----------------------------------------------------------------------------------------------------

Total administrative expenses                                            (759,036)         (192,394)
----------------------------------------------------------------------------------------------------

Operating loss                                                           (958,590)         (233,773)
                                                                           
Interest payable and similar charges                                      (10,407)                 -
                                                                    --------------------------------
Loss before taxation                                                     (968,997)         (233,773)
                                                            
Tax on loss on ordinary activities                           4                   -                 -
                                                                    --------------------------------
Loss for the period after taxation                                        (968,997)        (233,773)
                                                                    --------------------------------
                                                                    --------------------------------
Basic and diluted loss per share (pence)                     5               (1.42)           (0.36)
                                                                                     


All amounts relate to continuing operations.

There  were no recognised gains and losses for the Period other than those included in the results
above and therefore no separate statement of total recognised gains and losses has been presented.


Consolidated Balance Sheet
As at 31 March 2013

                                                                                                        
                                                                       31 March                    31 December
                                                                           2013                           2011
                                             Note                £            £             £                £
                                                                                               
Assets
Fixed assets                                                             75,435                         77,718
                                                                   -------------                  -------------
Total fixed assets                                                       75,435                         77,718
                                                                                                         
Current assets                                                                                  
Stocks                                                     547,050                          -   
Debtors                                                    233,794                    264,423   
Cash at bank and in hand                                   144,601                      6,989   
                                                      -------------              -------------              

Total current assets                                       925,445                    271,412   
                                                                                               
Creditors: amounts falling due within one                  
year                                                     (281,473)                  (333,036)
                                                      -------------              -------------
Net current assets/ (liabilities)                                      643,972                        (61,654)
                                                                  -------------                   -------------

Total assets less current liabilities                                  719,407                          16,064
                                                                  -------------                   -------------  
Creditors: amounts falling due after more                           
 than one year                                                     (1,495,990)                       (128,500)
                                                                  -------------                   -------------
Total net liabilities                                                (776,583)                       (112,436)
                                                                  -------------                   -------------
                                                                  -------------                   -------------
CAPITAL AND RESERVES
Called up share capital                        6                      720,563                           64,002
Share premium account                          7                    1,973,412                           16,000
Reverse acquisition reserve                    7                  (2,102,490)                          206,633
Profit and loss account                        7                  (1,368,068)                        (399,071) 
                                                                 -------------                    -------------
SHAREHOLDERS' DEFICIT                          7                    (776,583)                        (112,436)
                                                                 -------------                    ------------- 
                                                                 -------------                    -------------



Consolidated Cash Flow Statement
For the Period ended 31 March 2013

                                                                                            Pro forma
                                                                       15 month              16 month
                                                                   period ended          period ended
                                                                       31 March           31 December
                                                                           2013                  2011
                                                       Note                   £                     £
                                                                                                     
                                                        
Net cash outflow from operating activities                8         (1,081,865)             (280,255)
                    
Returns on investments and servicing of finance           9            (10,407)                     -

Capital expenditure and financial investment              9            (19,186)               (2,502)
                                                                                                     
Cash outflow before financing                                       (1,111,458)             (282,757)
                                                               --------------------------------------
Financing                                                 9           1,392,619               128,802
                                                               --------------------------------------
Increase/(decrease) in cash in the period                               281,161             (153,955)
                                                          



Reconciliation of Net Cash Flow to Movement in Net Debt
For the Period ended 31 March 2013

                                                                                            Pro forma
                                                                      15 month               16 month
                                                                  period ended           period ended
                                                                      31 March            31 December
                                                                          2013                   2011
                                                                             £                      £
                                                                                                     
Increase/(decrease) in cash in the period                              281,161              (153,955)
                                                                                                     
Cash outflow from decrease in debt and lease
 financing                                                         (1,367,188)              (128,802)
                                                               --------------------------------------
                                     
Change in net debt resulting from cash flows                       (1,086,027)              (282,757)
                                                                      
Net debt/funds at 1 January 2012                                     (265,362)                 17,395
                                                               --------------------------------------

Net debt at 31 March 2013                                          (1,351,389)              (265,362)
                                                               ---------------        ---------------
                                                               --------------------------------------



Notes to the financial information
For the period ended 31 March 2013


1.    ACCOUNTING POLICIES

        1.1  Basis of preparation of financial statements
         
             The  financial information has been prepared in accordance with United Kingdom Generally Accepted
             Accounting  Practice. The financial information is prepared on the historical basis of accounting
             and in accordance with applicable United Kingdom law and accounting standards.
             
             Except  as disclosed below, the same accounting policies, presentation and methods of computation
             have  been  followed in this financial information as those which were applied in the preparation
             of  the  financial  statements of Mission Entertainment Group Limited for  the  period  ended  31
             December  2011,  upon  which  the auditors issued an unqualified opinion,  and  which  have  been
             delivered to the registrar of companies.
             
             Basis of consolidation of Papa Entertainment plc
             
             The   consolidated   financial  information  incorporate  the  financial  information   of   Papa
             Entertainment Plc and its subsidiaries.
             
             On   24  July  2012,  Papa  Entertainment  plc  became  the  legal  holding  company  of  Mission
             Entertainment Group Limited and its subsidiaries via a share for share exchange.
             
             UK  company  law and accounting standards do not envisage reverse acquisition accounting  and  to
             adopt  that  approach  is  a  departure from the law and accounting standards.  However,  such  a
             departure  is  required by both the Companies Act and accounting standards where it is  necessary
             to give a true and fair view.
             
             The  directors have developed an accounting policy for this transaction as explained  further  in
             note 3.
             
             Furthermore,  as  Papa  Entertainment Plc was incorporated on 12  May  2011,  while  the  Mission
             Entertainment Group began trading in 2010, the comparative profit and loss account and cash  flow
             statement  are  pro forma.  The consolidated financial statements therefore are  for  the  period
             from  1  January  2012  to  31  March 2013 and are presented in  pounds  sterling  ("GBP").   The
             comparative period is for the 16 month period to 31 December 2011.
             
             The  parent  company financial statements are for the year to 31 March 2013, and the  comparative
             period is for the period to 31 March 2012.
             

             Going concern
             
             The  financial information has been prepared assuming the group will continue as a going concern.
             Under  the  going concern assumption, a group is ordinarily viewed as continuing in business  for
             the  foreseeable future with neither the necessity of liquidity, nor ceasing trading  or  seeking
             protection  from  creditors  pursuant to laws or regulations.  In  assessing  whether  the  going
             concern  assumption is appropriate, management takes into account all available  information  for
             the  foreseeable  future, in particular for the twelve months from the date of  approval  of  the
             financial  statements.  Management have a reasonable expectation that  the  entity  has  adequate
             resources  to  continue in its operational exercises for the foreseeable future and  has  adopted
             the going concern basis of accounting in preparing the financial information.
             
             Eoghan  Hynes  a  director and shareholder of the Company has undertaken to the Company  that  he
             would  support  and  continue to support the Group financially, as required  so  that  the  Group
             maintains  adequate  financial and working capital resources for a minimum period  of  12  months
             commencing  from  the date of the signing of these accounts and is able to pay its  existing  and
             future liabilities or commitments with third parties.
             
             Other debtors
             
             Royalties due to a composer are credited against any outstanding advances in the year of  receipt
             until  the advance is fully recovered.  If it is thought that future earnings will not amount  to
             the  net  value of an advance, then a provision for the estimated shortfall is raised.   Advances
             are  included  in other debtors as recoverable within one year although certain  amounts  may  be
             recovered after more than one year.
             
             Stocks and work in progress
             
             Stocks  and  project  work in progress are valued at the lower of cost and net  realisable  value
             after making due allowance for obsolete and slow-moving stocks.
             
             Project  work in progress is fully provided at the point where the project cannot be foreseen  to
             commercial completion or where loss is anticipated.
             
             Announcement information
             
             The  information set out in this announcement does not constitute the Group's statutory financial
             statements  for  the period ended 31 March 2013 as defined in Section 434 of  the  Companies  Act
             2006,  but  was extracted from those audited financial statements. The auditors have reported  on
             the  statutory  financial  statements  for the period  ended  31  March  2013;  this  report  was
             unqualified but included the following emphasis of matter in respect of going concern:
             
             "In  forming our opinion on the financial statements, which is not qualified, we have  considered
             the  adequacy  of  the  disclosure  made  in note 1 to the financial  statements  concerning  the
             company's and the group's ability to continue as a going concern. The financial position and  the
             current  liabilities of the group are disclosed on the balance sheet on page 8. These conditions,
             along  with  the  other  matters explained in note 1 to the financial  statements,  indicate  the
             existence  of  a material uncertainty which may cast significant doubt about the group's  ability
             to  continue  as  a  going  concern  though our opinion is not qualified  in  this  respect.  The
             financial  statements do not include the adjustments that would result if the company was  unable
             to continue as a going concern."
             
             
             The  financial information set out in this announcement was approved by the board  on  29  August
             2013.
             
             The directors do not recommend the payment of a dividend (2012: nil).
             


2.    TURNOVER AND SEGMENTAL INFORMATION

      The whole of the turnover is attributable to the principal activities of the group.
      
      All  turnover was derived from external customers and an analysis by geographical market was
      as follows:
      
                                                                              Pro forma
                                                           15 month            16 month
                                                       period ended        period ended
                                                           31 March         31 December
                                                               2013                2011
                                                                  £                   £
                                                                
     United Kingdom                                           1,285               1,856
     USA                                                     29,998                   -
                                                    ------------------------------------             
     Total                                                   31,283               1,856
                                                    ------------------------------------ 
      
      The  group  has  two  classes  of business that are separable by  their  geographic  region.
      Activity  in  the  UK relates to the trade associated with the recording and  publishing  of
      material  by  various different artists. Activity in the USA relates to  the  production  of
      concerts. An analysis of results by each segment is as follows;

      Loss before tax by principal activities was as follows:

                                                                          Pro forma
                                                       15 month            16 month
                                                   period ended        period ended
                                                       31 March         31 December
                                                           2013                2011
                                                              £                   £
                                                                
Recording and publishing                              (686,425)           (233,773)
Concerts                                              (282,572)                   -
                                                ------------------------------------                
Total                                                 (968,997)           (233,773)
                                                ------------------------------------ 

      Net liabilities of the group by principal activities was as follows:
 
                                                                          Pro forma
                                                       15 month            16 month
                                                   period ended        period ended
                                                       31 March         31 December
                                                           2013                2011
                                                              £                   £
                                                                 
Recording and publishing                              (494,011)           (112,436)
Concerts                                              (282,572)                   -
                                                ------------------------------------                  
Total                                                 (776,583)           (112,436)
                                                ------------------------------------ 

3.    REVERSE ACQUISITION

On  24  July  2012,  Papa  Entertainment plc became the legal  holding  company  of  Mission
Entertainment  Group  Limited  and its subsidiaries via a  share  for  share  exchange.  The
aggregate  consideration  was £2,560,083, which was satisfied by  the  issue  of  64,002,070
ordinary  shares  of  £0.01 each in Papa Entertainment plc at an issue price  of  £0.04  per
ordinary share.

The  accounting  policy  adopted by the directors applies  the  principles  of  UK  GAAP  in
identifying  the  accounting  acquirer and the presentation of  the  consolidated  financial
statements  of the legal parent (Papa Entertainment plc) as a continuation of the accounting
acquirer's financial statements (Mission Entertainment Group Limited).  This policy reflects
the commercial substance of this transaction as follows:

    -  the  original  shareholders  of  the  subsidiary  undertakings  are  the  most  significant
       shareholders post initial public offering, owning 90 per cent. of the issued share capital;
       and
    -  the  cash consideration paid as part of the initial public offering returned equity to  the
       original  shareholders  of the legal subsidiary undertaking and as  a  consequence  diluted
       their shareholding to 10 per cent.

Accordingly, the following accounting treatment and terminology has been applied in respect of the
reverse acquisition:

    -  the  assets and liabilities of the legal subsidiary Mission Entertainment Group Limited are
       recognised and measured in the Group financial information at the pre-combination  carrying
       amounts, without reinstatement to fair value;
    -  the  retained  earnings  and  other  equity balances  recognised  in  the  Group  financial
       information   reflect  the  retained  earnings  and  other  equity  balances   of   Mission
       Entertainment Group Limited immediately before the business combination, and the results of
       the  period  from  1 September 2010 to the date of the business combination  are  those  of
       Mission Entertainment Group Limited.  However, the equity structure appearing in the  Group
       financial  information  reflects the equity structure of the legal  parent,  including  the
       equity  instruments  issued  under  the share for share exchange  to  effect  the  business
       combination;
    -  comparative numbers presented in the Group financial information are those reported in  the
       financial statements of the legal subsidiary, Mission Entertainment Group Limited, for  the
       period ended 31 December 2011.
    -  the  cost  of  the  combination  has  been  determined  from  the  perspective  of  Mission
       Entertainment  Group Limited.  The fair value of the shares in Mission Entertainment  Group
       Limited has been determined from the admission price of Papa Entertainment plc on admission
       to  trading  on ISDX for £0.04 pence per share.  The value of the consideration shares  was
       £2,560,083.   The fair value of the notional number of equity instruments  that  the  legal
       subsidiary  would  have had to have issued to the legal parent to give the  owners  of  the
       legal  parent the same percentage ownership in the combined entity is 10 per  cent  of  the
       market  value  of  the  shares  after issues, being £256,008. The  difference  between  the
       notional  consideration  paid  by Papa Entertainment plc for  Mission  Entertainment  Group
       Limited  and  the  Papa  Entertainment plc net liabilities acquired  of  £22,961  has  been
       recorded as goodwill, and charged to the consolidated profit and loss account at a cost  of
       £278,969 with a corresponding entry to the reverse acquisition reserve.

Papa  Entertainment  plc  had  no  significant assets  nor  significant  other  liabilities  or
contingent liabilities of its own at the time that the share for share exchange took effect.


4.    TAXATION

No charge to taxation arises in the period ended 31 March 2013 (31 December 2011: nil).


5.    LOSS PER SHARE

Basic  earnings/(loss)  per  share  is calculated by dividing the  earnings  attributable  to  ordinary
shareholders by the weighted average number of ordinary shares outstanding during the period.
      
A reconciliation is set out below:

                                                                                       Pro forma
                                                                    15 month            16 month
                                                                   period to           period to
                                                                    31 March         31 December
                                                                        2013                2011
Basic loss per share                                                       £                   £

Loss for the period                                                (968,997)           (233,773)

Weighted average number of shares                                 68,424,483          64,002,070

Loss per share (pence)                                                (1.42)              (0.36)
 

In  calculating  the  weighted average number of ordinary shares outstanding (the  denominator  of  the
earnings per share calculation) during the period in which the reverse acquisition occurs:

(a)      the number of ordinary shares outstanding from the beginning of that period to the acquisition
date  shall  be computed on the basis of the weighted average number of ordinary shares  of  the  legal
acquiree  (accounting  acquirer)  outstanding  during the  period  multiplied  by  the  exchange  ratio
established in the merger agreement; and

(b)      the number of ordinary shares outstanding from the acquisition date to the end of that  period
shall  be  the  actual  number  of  ordinary shares of the legal  acquirer  (the  accounting  acquiree)
outstanding during that period.

The  basic earnings per share for each comparative period before the acquisition date presented in  the
consolidated financial statements following a reverse acquisition shall be calculated by dividing:

(a)     the profit or loss of the legal acquiree attributable to ordinary shareholders in each of those
periods by

(b)      the  legal  acquiree's  historical  weighted average number  of  ordinary  shares  outstanding
multiplied by the exchange ratio established in the acquisition agreement.


There are no current dilutive instruments in issue, therefore the diluted loss per share is the same as
the basic loss per share.



6.    SHARE CAPITAL

                                                                                                    
                                                                           31 March        31 December
                                                                               2013               2011
                                                                                  £                  £
        Allotted, called up and fully paid                                                           
                                                                                                     
        72,056,290 Ordinary shares of £0.01 each (2011 -                 
         6,400,200 Ordinary shares of £0.01 each)                          720,563              64,002
                                                                         -------------------------------
                                                                         -------------------------------


                                                      Number of            Share     Share Premium
                                                         Shares          Capital
                                                                               £                 £
                                                                                                  
       Ordinary shares issued at 1 January            
       2012                                           6,400,200           64,002            16,000
                                                                                                  
       Ordinary shares issued on 24 July             
       2012                                          64,002,070          640,021         1,920,062
       Ordinary shares issued on 24 July                
       2012                                             700,000            7,000            28,600
       Ordinary shares issued on 14                     
       September 2012                                   704,020            7,040                 -
       Ordinary shares issued on 16 November            
       2012                                             250,000            2,500             8,750
                                                   -------------------------------------------------
       Called-up and fully paid ordinary             
       shares of £0.01 each at 31 March 2013         76,056,290          720,563         1,973,412
                                                   -------------------------------------------------
                                                   -------------------------------------------------

On  24 July 2012, the Company purchased the entire ordinary share capital of Mission Entertainment
Group  Limited, for an aggregate consideration of £2,560,083, which was satisfied by the issue  of
Ordinary Shares of £0.01 in the Company at an issue price of £0.04 per Ordinary Share.

On  24 July 2012, 700,000 Ordinary Shares were issued by the Company to noteholders of Convertible
Unsecured Loan Notes following the receipt by the Company of their notice to exercise their  right
to convert the loan notes into shares pursuant to the loan note instrument.

On 14 September 2012, 704,020 Ordinary Shares were issued by the Company to SVS Securities on ISDX
at £0.01 per Ordinary Share.

On  16 November 2012 250,000 Ordinary Shares of £0.01 each were issued by the Company at a premium
of £0.035 per share for a consideration of £11,250.


7.    RECONCILIATION OF MOVEMENT IN SHAREHOLDERS' FUNDS

                                 Share        Share         Reverse     Profit and                
                               Capital      Premium     Acquisition           Loss                
                                                            Reserve        Account           Total
                           -------------------------------------------------------------------------
     Group                           £            £               £              £               £
                                                                                                  
     At 1 September 2010             -            -               -      (165,298)       (165,298)
     Issue of shares            64,002       16,000               -              -          80,002
     Reverse acquisition             
     adjustment                      -            -         206,633              -         206,633
     Loss for the period             -            -               -      (233,773)       (233,773)
                          -------------------------------------------------------------------------
     Balance at 31              64,002       16,000         206,633      (399,071)       (112,436)
     December 2011
                                                                                                  
     Loss for the period             -            -               -      (968,997)       (968,997)
     Issue of shares on        
     acquisition               640,021    1,920,062     (2,309,123)              -         250,960
     Conversion of loan          
     notes                       7,000       28,600               -              -          35,600
     Issue of other              
     shares 9,540                8,750            -               -              -          18,290
                          -------------------------------------------------------------------------
     Balance at 31 March       
     2013                      720,563    1,973,412     (2,102,490)     (1,368,068)       (776,583)

                          -------------------------------------------------------------------------
                          -------------------------------------------------------------------------


8.    NET CASH FLOW FROM OPERATING ACTIVITIES

                                                                                                  Pro forma
                                                                                                   16 month
                                                                           15 month               period to
                                                                          period to        31 December 2011
                                                                      31 March 2013
                                                                                  £                      £
                                                                                                            
        Operating loss                                                    (679,621)               (233,773)
        Depreciation of tangible fixed assets                                21,470                  16,592
        Increase in stocks                                                (547,050)                       -
        Decrease/(Increase) in debtors                                       30,629               (246,083)
        Increase in creditors                                                92,707                 183,009
                                                                     ----------------------------------------
                                                                     ----------------------------------------
        Net cash outflow from operating activities                      (1,081,865)               (280,255)



9.    ANALYSIS OF CASH FLOWS FOR HEADINGS NETTED IN CASH FLOW STATEMENT

                                                                                                 Pro forma
                                                                            15 month              16 month
                                                                          period to              period to
                                                                      31 March 2013       31 December 2011
                                                                                  £                      £
                                                                                                            
        Returns on investments and servicing of finance                                                     
        
        Interest paid                                                      (10,407)                       -
                                                                     ----------------------------------------  
        Net cash outflow from returns on investments and                   
         servicing of finance                                              (10,407)                       -
                                                                     ----------------------------------------
                                                                                                          
                                                                                  £                      £
                                                                                                            
        Capital expenditure and financial investment                                                        
        
        Purchase of tangible fixed assets                                  (19,186)                 (2,502)

                                                                    ----------------------------------------
                                                                                                          
                                                                                  £                      £
                                                                                                            
        Financing                                                                                           
        
        Issue of shares                                                      25,431                       -
        Long term loans                                                   1,367,188                 128,802
                                                                    ----------------------------------------    

        Net cash inflow from financing                                    1,392,619                 128,802
                                                                    ----------------------------------------

10.   ANALYSIS OF CHANGES IN NET DEBT

                                                                                   Other 
                                                                                non-cash
                                        1 January            Cash flow           changes                31 March
                                             2012                                                           2013
                                                £                   £                  £                       £
                                                                                                    
Cash at bank and in hand                    6,989             137,612                  -                 144,601
                                                                                                    
Debt:
Overdrafts                              (143,549)             143,549                  -                       -
Debts falling due after more than        
one year                                (128,802)         (1,367,188)                  -             (1,495,990)
                                   -------------------------------------------------------------------------------

Net debt                                (265,362)         (1,086,027)                  -             (1,351,389)
                                   -------------------------------------------------------------------------------

11.   GUIDANCE NOTE 69.1 OF ISDX GROWTH MARKET - RULES FOR ISSUERS

During the 15 month period ended 31 March 2013 the Company did not comply with Guidance Note  69.1
of  the  ISDX  Growth Market - Rules for Issuers (as amended on 9 July 2013).   This  was  due  to
Directors Korda Marshall, Harry Cowell, Eoghan Hynes, Norman Lott and Andrew Morley holding levels
and  combinations of third party directorships outside of the Company (and its group),  which  did
not  meet  the  recommendation in the Guidance Note.  The Directors  believe  that  the  Company's
individual  Board  members currently have sufficient time to commit to the  performance  of  their
duties  as  Directors of the Company and that the current composition of the  Company's  Board  is
appropriate given the Company's size and stage of development.






                                             - Ends -

Contact Information

  • Papa Entertainment PLC