Catalyst Media Group expecting small loss thanks to SIS

14th Oct 2016 11:37

(ShareCast News) - Catalyst Media Group updated the market on Satellite Information Services Holdings, in which it has 20.54% interest, on Friday, with the company showing revenues of £227.9m for the year to 31 March 2016, down from £229m in the prior year.The AIM-traded firm said SIS reported a profit after tax of £16.6m, down from £21.4m, with the profits below the prior year due to a reduction in the customer subscriber base during the year, combined with increased costs arising from media rights to additional content and inflationary factors.Net cash generated from operating activities increased significantly to £43.2m from £32.3m, due mainly to working capital movements, and as at 31 March SIS had a substantially increased cash position of £62.2m compared to £21.9m, prior to the payment of the dividend."Given the strong cash position of SIS as set above, the progress it has made in signing new media rights and the continued positive cash flow generation of its operations, as announced on 29 July 2016, SIS approved a dividend of £20m," CMG's board said in a statement."Accordingly, the dividend received by CMG was £4.1m."Since its year end, SIS is trading in line with management's expectations and continues to generate positive cash flow."Taking account of CMG's share of SIS's profit for 2015 of £3.4m, together with a one off charge to reflect accounting changes in SIS of £0.4m and an impairment charge of £3m, on the basis CMG's investment in SIS has been maintained at £25m, CMG anticipated announcing a small loss for the year ended 30 June."In assessing the value of the company's investment in SIS, the board takes into account the performance and prospects of SIS, which are in line with the board's expectations and hence, in line with previous treatment, the company has made an impairment charge equal to its profit share in order to maintain the value of its investment in SIS."The final audited statements of CMG for the year ended 30 June are expected to be published on or before 20 December.