MBL drums up profit to please chorus despite key shareholder discord

22nd Aug 2016 11:45

(ShareCast News) - Amid an attempted boardroom coup at the behest of major shareholder, interim results from MBL Group revealed a return to profitability after five years.In the year to 31 March, MBL, which is a distributor and wholesaler of DVDs, CDs, records, and birdseed, generated revenue of £14.8m that represented a 14% rise on the prior year thanks to a strong performance in the Garden & Home division and a battling result for its home entertainment business against a "very challenging" market.MBL, which has been led by finance director Lisa Clarke since interim-chief executive since Trevor Allan was forced to step down due to medical reasons in March last year, returned to an operating profit of £21,000 after the previous year reporting a £0.9m loss, which was half-inflated by asset impairments.Although the profit may be considered bird feed in comparison with those of other larger companies, shares in the longstanding AIM-listed group climbed to a level not seen since 2011, the last year in which the company posted a profit.The result seemed to add to MBL investors' growing confidence ahead of an October shareholder meeting convened by the Allan family trust, which along with other Allan shareholders listed on the company's website has a 38.7% stake and has proposed the removal of chairman Tony Johnson and one other director.Johnson, a former CEO of multi-channel retailer Findel, ascended to the chair in 2014 after previous incumbent Peter Cowgill, who remains a 14.3% shareholder, resigned in the wake of a disagreement with the rest of the board over the future strategy of the company.At the time of Allan's enforced resignation, the company said it expected that he will be re-appointed to the board upon his return to work.In his absence in April, Johnson and Clarke oversaw the appointment of non-executive directors Timothy Jackson-Smith, a corporate and commercial lawyer, and Christopher Jones, a restructuring expert.The Allan family have requested Jones' removal along that of with Johnson.MBL was, as Air Music & Media, originally brought from OFEX to AIM in 2002 by serial entrepreneur John French as a compiler of cheap CDs and DVDs before changing its name in 2008.