FRV Reports Revenues of $4.9 Million for Q3 2004-2005.MONTREAL Montreal (mŏn'trēôl`), Fr. Montréal (môNrāäl`), city (1991 pop. 1,017,666), S Que., Canada, on Montreal island, surrounded by St. Lawrence River and Rivière des Prairies. -- FRV FRV feline rhinotracheitis virus. Media Inc. (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension VENTURE:FRV)
TABLE 1
KEY FIGURES, THIRD QUARTER AND FIRST NINE MONTHS
(In thousands of dollars, except amounts per share. Amounts
per share are fully diluted)
--------------------------------------------------------------------
Quarters ended: Nine months ended:
--------------------------------------------------------------------
December 31 December 31 December 31 December 31
2004 2003 2004 2003
--------------------------------------------------------------------
Revenues 4,862 4,402 16,959 5,277
--------------------------------------------------------------------
Gross profit 981 648 2,254 970
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EBITDA 107 (60) (480) (888)
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Net earnings (net loss) 212 (155) (583) (817)
--------------------------------------------------------------------
Earnings (loss)
per share ($) 0.01 (0.01) (0.02) (0.04)
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Highlights:
- FRV achieves net earnings of $212,000 or $0.01 per share.
- Made-for-TV movie The Last Casino, produced by Cite-Amerique,
wins the Bronze Medal in the TV Movie/Drama Specials category at
the New York Festivals 2005 International Television Programming
and Promotion Competition.
- Altau.tv produces several profitable shows, including Soir de
fete avec Isabelle Boulay, aired in Canada and France.
- INEO successfully organizes the Montreal Education Training
Career Fair and the annual Canadian Manufacturers and Exporters
conference.
The Board of Directors of FRV Media Inc. ("FRV" or the "Company") today approved the Company's financial results for the second quarter ended December December: see month. 31, 2004. For the quarter ended December 31, 2004, FRV Media recorded consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: revenues of $4,861,827, up 10.5% over the corresponding year-earlier period. FRV Media acquired INEO between these two periods of comparison (in January January: see month. 2004). Earnings before interest, depreciation and amortization, unusual item and taxes were $106,924 for the quarter, against a loss of $60,333 a year earlier. FRV Media recorded net earnings of $212,275 or $0.01 per share, compared with a loss of $155,155 or $0.01 per share for the corresponding year-ago period. "Given our short history, these quarterly results are satisfactory", commented Richard Ri·chard , Joseph Henri Maurice Known as "Rocket." 1921-2000. Canadian hockey player. A right wing for the Montreal Canadiens (1942-1960), he led his team to eight Stanley Cup championships and was the first player to score 50 goals in a Laferriere, president and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of FRV Media. "That said, our potential is greater than these results and our profitability will improve if some of the projects on which we're we're Contraction of we are. we're we are currently working materialize ma·te·ri·al·ize v. ma·te·ri·al·ized, ma·te·ri·al·iz·ing, ma·te·ri·al·iz·es v.tr. 1. To cause to become real or actual: By building the house, we materialized a dream. ." Added Mr. Laferriere: "The results for the quarter are largely attributable to the following factors: - Delivery by Cite-Amerique and Altau.tv of several profitable feature films and television programs. - A gross profit that nevertheless is below expectations, mainly due to the deferral of certain projects that were replaced by others with a lower margin. - The positive impact on consolidated sales of the INEO acquisition, whose activities and profitability peak in the fall. - Financial gains of $161,092 realized as a result of changes in the Company's capital structure." Revenues for the nine-month period ended December 31 stood at $16,958,540, versus $5,277,271 a year earlier. The loss before interest, depreciation and amortization, unusual item and taxes amounted to $479,837, an improvement over the $888,068 recorded on the same date last year. The net loss was $583,135 or $0.02 per share, in comparison with $816,661 or $0.04 per share a year ago. The period of comparison recorded an unusual after-tax gain of $267,433. The results of the first nine months of fiscal 2005 are attributable to the following factors: - The positive impact on sales of the acquisition of Altau.tv in August 2003 and INEO in January 2004. - The delivery by Cite-Amerique and Altau.tv of several profitable feature films and television programs, notably, Monica la Mitraille. - A gross profit below expectations, mainly due to the deferral of certain projects that were replaced by other, lower-margin projects, as well as weaker than expected sales by INEO and by Cite-Amerique International abroad. FRV Media's operations generated positive cash flows of $584,835 for the first nine months of the year reflecting changes in assets (accounts receivable, productions in process and under development) and liabilities (progress advances on productions in process). ANALYSIS OF THIRD QUARTER RESULTS Revenues In the third quarter ended December 31, 2004, FRV Media achieved revenues of $4,861,827, compared with $4,401,629 in the third quarter last year. These revenues essentially stem from: - Cite-Amerique's delivery of Selling Innocence, a TV movie aired by CTV; - Altau.tv's delivery of the variety show Soir de Fete avec Isabelle Boulay, broadcast in Canada on TQS and in France on FR2. This show had originally been planned for the first quarter of the year; - Altau.tv's delivery of episodes of the series Fous du risque (Canal D) and Projet Tuning (Ztele); - Altau.tv's event recording, coverage and dubbing activities; and - INEO's Education Training Career Fair in Montreal and the annual conference of Canadian Manufacturers and Exporters. Considering the deferrals in the first quarter, revenues are in line with our expectations. Gross profit Gross profit for the quarter was $980,642 or 20.2% of sales, against $648,256 or 14.7% of sales. A clear improvement over last year, the gross profit in the third quarter is generally consistent with the major benchmarks observed in our industry. Thus, while consistent with the generally observed benchmarks in the exhibition industry, INEO's gross profit was slightly below expectations. As well, the requirements of the broadcasters of the variety show Soiree soi·ree also soi·rée n. An evening party or reception. [French soirée, from Old French seree, from seir, evening, from Latin de Fete avec Isabelle (theory, tool) Isabelle - A generic theorem prover with support for several object-logics, developed by Lawrence C. Paulson <Larry.Paulson@cl.cam.ac.uk> in collaboration with Tobias Nipkow at the Technical University of Munich. Boulay pushed production costs higher than expected, which although partially offset by strong revenues, reduced its gross margin rate below budget. Otherwise, our gross profit for the quarter is in line with budget and reflects the profit potential of the quarter's activities. Operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. FRV Media's consolidated operating expenses comprise those of FRV Media and its subsidiaries. For the quarter ended December 31, 2004, these expenses amounted to $873,718, compared with $708,589 in the same year-ago quarter. This increase is explained by the consolidation of INEO's expenses and by the fact that we stepped up development of our distribution and exporting activities, which gave rise to new operating expenses. Interest, depreciation and amortization, and extraordinary items Financial activities in the third quarter generated revenues of $121,906. Interest and bank charges net of interest income were $71,838 in the comparable period last year. The gain is the outcome of the conversion on November November: see month. 4 of 5,600,000 Class C shares into the same number of Class A shares. The Class C shares had a debt component for which the interest was implicit and capitalized Capitalized Recorded in asset accounts and then depreciated or amortized, as is appropriate for expenditures for items with useful lives longer than one year. but still reported as an expense. The conversion gave rise to a $161,092 gain on settlement of debt. Depreciation and amortization for the quarter amounted to $19,809, compared with $22,984 in fiscal 2004. ANALYSIS OF RESULTS FOR THE NINE-MONTH PERIOD ENDED DECEMBER 31 Revenues For the first nine months of fiscal 2005 ended December 31, 2004, FRV Media recorded revenues of $16,958,540, compared with $5,277,271 in the year-ago period. A good part of this growth is attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to the acquisition of Altau.tv in August 2003, INEO in January 2004, as well as major deliveries by Cite-Amerique. At approximately $7.5 million, Monica la Mitraille, delivered by Cite-Amerique in April, was the largest source of revenue recorded since the beginning of the year. The remaining $9.5 million stem from: - Cite-Amerique's delivery of the children's TV series Dragon I and feature film CQ2 to the distributor in June for release on November 5, and the TV movie Selling Innocence, delivered to CTV; - Altau.tv's delivery of episodes of the series Fous du risque (Canal D), Projet Tuning (Ztele) and Marc Gagnon rencontre (RDI); - Altau.tv's delivery of the variety show Soir de Fete avec Isabelle Boulay, broadcast in Canada on TQS and in France on FR2; - Altau.tv's event recording, coverage and dubbing activities; and - Events held by INEO in the spring and fall, namely, the Education Training Career Fair in Ottawa and Montreal, the Training Symposium in Montreal, and the organization of the Canadian Manufacturers and Exporters annual conference. Overall, revenues for the first three quarters are in line with expectations despite the fact that some projects did not proceed as originally planned. For example, revenues from events organized by INEO were lower than expected. These shortfalls in relation to plan were offset by the April delivery of a few episodes of Dragon dragon, mythical beast usually represented as a huge, winged, fire-breathing reptile. For centuries the dragon has been prominent in the folklore of many peoples; thus, its physical characteristics vary greatly and include combinations of numerous animals. I, initially slated for March, i.e., the end of last year, by the organization of the annual Manufacturers and Exporters conference and by higher than projected event recording and coverage revenues as a result of the contracts for the Grand Prix Grand Prix n. pl. Grand Prix Any of several competitive international road races for sports cars of specific engine size over an exacting, usually risky course. de Trois-Rivieres and the Champ Car “CART” redirects here. For other uses, see CART (disambiguation). Champ Car, an abbreviation of "Championship Car", has been the name for a class and specification of cars used in American Championship Car Racing for many decades. Molson Indy Molson Indy can refer to any of the following races:
For these reasons, although we previously forecasted positive earnings for the fiscal year, and in spite of in opposition to all efforts of; in defiance or contempt of; notwithstanding. See also: Spite a profitable third quarter, management now believes that the current fiscal year will produce a net loss most likely less than the previous year. Gross profit Gross profit for the first nine months of the year was $2,253,601 or 13.3% of sales, against $970,451 or 18.4% last year. Gross profit for the year to date remains below potential, mostly due to a shortfall Shortfall The amount by which the capital required to fulfill a financial obligation exceeds available capital. Notes: Shortfall risk is often combated with an efficient hedging strategy created by a fund, group, institution, or individual. in INEO's event recording revenues and to higher than expected production costs for Soiree de Fete avec Isabelle Boulay. Operating expenses FRV Media's consolidated operating expenses comprise those of FRV Media and its subsidiaries. For the nine-month period ended December 31, 2004, these expenses amounted to $2,733,438, compared with $1,858,519 in the year-earlier interval. This increase is explained by the consolidation, for the entire period, of the expenses of Altau.tv and INEO, acquired in August 2003 and January 2004 respectively. As well, FRV stepped up development of its distribution and exporting activities, giving rise to earlier than anticipated expenses. Losses for the nine-month period before interest, depreciation and amortization, extraordinary items and taxes were $479,837, compared with $888,068 a year earlier, an improvement of $408,231. Interest, depreciation and amortization, and extraordinary items Financial expenses, net of interest income, amounted to $9,617 versus $153,036 in the same nine month-period last year. The decrease in interest expense stems mainly from the conversion of 5,600,000 Class C shares into an equivalent number of Class A shares. The Class C shares had a debt component for which implicit and capitalized interest Capitalized interest Interest that is not immediately expensed, but rather is considered as an asset and is then amortized through the income statement over time. In the context of project financing, interest that is paid by additional borrowing. was recorded. The conversion gave rise to a $161,092 gain on settlement of debt. The increase in depreciation and amortization in the first nine months of the year from $42,990 to $95,690 year-over-year is attributable to the Altau.tv and INEO acquisitions. Losses before extraordinary items and taxes were $586,389 as compared with $1,084,094 for the corresponding year-earlier period. During the first quarter last year, subsidiary Cite-Amerique reached an out-of-court settlement An agreement reached between the parties in a pending lawsuit that resolves the dispute to their mutual satisfaction and occurs without judicial intervention, supervision, or approval. with a third party concerning the exploitation of certain rights derived de·rive v. de·rived, de·riv·ing, de·rives v.tr. 1. To obtain or receive from a source. 2. from the television series Marguerite Marguerite, for French women thus named, use Margaret Marguerite. For French women thus named, use Margaret. marguerite, in botany marguerite: see daisy. Volant vo·lant adj. 1. Flying or capable of flying. 2. Moving quickly or nimbly; agile. 3. Heraldry Depicted with the wings extended as in flying. .As a result of this settlement, the Company recorded an extraordinary gain of $267,433 net of charges and applicable taxes. RECENT DEVELOPMENTS The TV movie The Last Casino casino or cassino (both: kəsē`nō). 1 Card game played with a full deck by two to four players. Its origins are obscure though it probably traces back to the Italian game of Scopa. , produced by Cite-Amerique, won the Bronze Medal in the TV Movie/Drama Specials category at the New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of Festivals 2005 International Television Programming and Promotion Competition. Cite-Amerique continues filming Station X, which will air on Teletoon Teletoon, a portmanteau of "television" and "cartoon", is a name used for three cable and satellite animation channels: Teletoon Channels from Canada
Altau.tv is producing L'Antichambre des grands, a 90-minute documentary documentary: see motion pictures. documentary Fact-based film that depicts actual events and persons. Documentaries can deal with scientific or educational topics, can be a form of journalism or social commentary, or can be a conduit for propaganda that will air on RDS (1) (Remote Data Services) A set of programming interfaces from Microsoft that enables users to update data on the Internet or intranets from their ActiveX-enabled browser. and be delivered before the end of the current fiscal year. A second series of Marc Gagnon Marc Gagnon (born May 24, 1975 in Chicoutimi, Quebec) is a French Canadian short track speed skater. He is a four-time individual World Champion and winner of three Olympic gold medals. rencontre Ren`con´tre n. 1. Same as Rencounter, n. os> will also be delivered during the fourth quarter of fiscal 2005 and in early fiscal 2006. Altau.tv is also part of the Metrovision project of the Societe de transport de Montreal.Alongside partners that include RDI RDI - Receiver Data Interface , Cirque du Soleil Cirque du Soleil (French for "Circus of the Sun") is an entertainment empire based in Montreal, Quebec, Canada and founded in Baie-Saint-Paul in 1984 by two former street performers, Guy Laliberté and Daniel Gauthier. and National Film Board, Altau.tv is providing informative and entertaining capsules that are broadcast on giant screens in Montreal metro The Montreal Metro is the main form of public transportation within the city of Montreal, Quebec, Canada. The Metro, operated by the Société de transport de Montréal (STM), was inaugurated on October 14, 1966, during the tenure of Mayor Jean Drapeau. stations. OUTLOOK The Company will pursue both its organic and external growth. Our development plan has three thrusts: - Develop the distribution and export aspects of our business, which is already underway. The recent investment by the Solidarity Fund and Fondaction CSN will now allow us to deploy the resources required to forge ahead with this project. - Increase international co-productions. FRV already has achievements to its credit in this regard (Soir de Fete avec Isabelle Boulay, broadcast in Canada on TQS and in France by FR2, Dragon I, for which episodes were delivered in the first half of the year, and Dragon II, currently in production, are German and Korean co-productions) as well as French co-productions in progress, such as the documentary series entitled Messagers de l'Histoire. - Making timely acquisitions that will not only increase business volume and profits but also help create a coherent ensemble of operating units that complement each other by their respective focus and expertise. FRV will continue to back the development of its subsidiaries and enhance their complementarity com·ple·men·tar·i·ty n. 1. The correspondence or similarity between nucleotides or strands of nucleotides of DNA and RNA molecules that allows precise pairing. 2. and potential synergy The enhanced result of two or more people, groups or organizations working together. In other words, one and one equals three! It comes from the Greek "synergia," which means joint work and cooperative action. in a profitable manner and at a pace commensurate com·men·su·rate adj. 1. Of the same size, extent, or duration as another. 2. Corresponding in size or degree; proportionate: a salary commensurate with my performance. 3. with its financial capacity. The net loss for the first three quarters amounts to $583,135. Although the quarter ended December 31 was the most profitable in our young history, the results fell short of expectations. Some projects that were to have been delivered before the end of the year were delayed. Such is the case, in particular, of Dragon II. Consequently, the net earnings projected for the fourth quarter, while positive, will not be sufficient to make the entire fiscal year profitable. FORWARD-LOOKING for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. INFORMATION This press release contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. reflecting the objectives, estimates and expectations of FRV Media. These statements are identified by the use of verbs such as "believe," "anticipate," "estimate" and "expect" as well as the use of the future or conditional Subject to change; dependent upon or granted based on the occurrence of a future, uncertain event. A conditional payment is the payment of a debt or obligation contingent upon the performance of a certain specified act. tense tense [O.Fr., from Lat.,=time], in the grammar of many languages, a category of time distinctions expressed by any conjugated form of a verb. In Latin inflection the tense of a verb is indicated by a suffix that also indicates the verb's voice, mood, person, and . By their very nature, these types of statements involve risk and uncertainty. Consequently, results could differ materially from the Company's projections or expectations. For information on the nature of risk factors not specifically discussed in this press release, the reader is invited to consult the FRV Annual Report for the fiscal year ended March 31, 2004, under the heading "Risks and Uncertainties," page 11. ADDITIONAL INFORMATION The complete interim management's analysis and discussion of operating results and financial position for the quarter ended December 31, 2004 can be found on the SEDAR SEDAR System for Electronic Document Analysis and Retrieval SEDAR Southeast Data, Assessment, and Review Web site at the address www.sedar.com. Moreover the Company regularly discloses information pertaining per·tain intr.v. per·tained, per·tain·ing, per·tains 1. To have reference; relate: evidence that pertains to the accident. 2. to its operations through press releases, quarterly financial statements and its annual information form. This information is available on the SEDAR Web site at www.sedar.com. ABOUT FRV MEDIA FRV Media Inc. is a producer, exporter and integrator (1) In electronics, a device that combines an input with a variable, such as time, and provides an analog output; for example, a watt-hour meter. (2) See systems integrator. of quality content deployed across multiple platforms Refers to two or more operating environments, which typically include the CPU family and operating system. For example, if versions of a program run on Windows and the Macintosh, the software is said to support multiple platforms. : television, cinema, multimedia, and publishing. Through its wholly-owned subsidiaries Cite-Amerique, Altau.tv and INEO Group, the Company creates and distributes dramatic content (TV series, made-for-TV movies and feature films), youth programs, children's programs, documentaries, sitcoms  The perspective and/or examples in this article do not represent a world-wide view. Please [ edit] this page to improve its geographical balance. , magazine-style series and education, training and career
planning information. It is also involved in dubbing dubbingremoval of most of the comb of day-old chickens. See also decombing. and event recording.
FRV Media Inc.
Consolidated earnings (unaudited)
THREE-MONTH PERIOD NINE-MONTH PERIOD
ENDED DECEMBER 31 ENDED DECEMBER 31
2004 2003 2004 2003
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$ $ $ $
Revenue 4,861,827 4,401,629 16,958,540 5,277,271
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Production costs 3,845,878 3,555,548 14,544,779 3,737,060
Distribution direct
costs 35,307 197,825 160,160 569,760
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3,881,185 3,753,373 14,704,939 4,306,820
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Gross profit 980,642 648,256 2,253,601 970,451
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Operating expenses 873,718 708,589 2,733,438 1,858,519
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Profit (Loss) before
interest,
amortization,
unusual item and
taxes 106,924 (60,333) (479,837) (888,068)
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Interest income (10,760) 2,998 (24,858) (30,439)
Interest and bank
charges 49,946 68,840 19,5567 183,475
Gain on settlement
of debt (161,092) - (161,092) -
Loss on disposition
of fixed assets - - 1,246 -
Amortization of
property, plant
and equipment 19,809 22,984 95,690 42,990
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(102,097) 94,822 106,552 196,026
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Profit (Loss)
before unusual item
and taxes 209,021 (155,155) (586,389) (1,084,094)
Unusual item 267,433
Balance of sale
realized on
settlement of
lawsuit
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Profit (Loss) before
taxes 209,021 (155,155) (586,389) (816,661)
Income taxes recovered (3,254) - (3,254) -
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Net Profit (Net loss) 212,275 (155,155) (583,135) (816,661)
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Basic and diluted
profit (loss) per
class A and C share 0,01 (0,01) (0,02) (0,04)
Basic and diluted
weighted average
number of class A
and C shares 27,947,018 25,388,980 27,955,155 23,048,844
FRV Media Inc.
Consolidated Deficits (unaudited)
THREE-MONTH PERIOD NINE-MONTH PERIOD
ENDED DECEMBER 31 ENDED DECEMBER 31
2004 2003 2004 2003
---------------------------------------------------------------------
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$ $ $ $
Deficit, beginning
of period (2,818,459) (1,898,142) (2,023,048) (1,236,636)
Prior year's
adjustment to
reflect change in
accounting for
stock-based
compensation
(note 3) (169,225) - (169,225) -
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Restated deficit,
beginning of
period (2,987,684) (1,898,142) (2,192,273) (1,236,636)
Net Profit (Net loss) 212,275 (155,155) (583,135) (816,661)
Share Issue Costs (277,809) (6,525) (277,809) (6,525)
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Deficit, end of
period (3,053,218) (2,059,822) (3,053,218) (2,059,822)
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FRV Media Inc.
Consolidated Balance Sheets as at December 31 (unaudited)
December 31, 2004 March 31, 2004
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(audited)
ASSETS
Cash 677,378 1,426,162
Short-term investments 1,643,727 3,170,071
Segregated investments 2,626,675 -
Accounts receivable 2,997,202 7,175,268
Income taxes receivable 37,777 37,777
Prepaid expenses 35,456 72,900
Deferred fees 31,948 -
Productions in process and productions
under development 8,420,196 10,810,149
Investments in films and television
programs 25,139 51,129
Recoverable distribution direct costs 145,189 29,396
Balance of sale 150,000 300,000
Property, plant and equipment 424,212 449,830
Future income taxes 499,325 499,325
Goodwill 2,550,382 2,550,382
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20,264,606 26,572,389
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Liabilities
Short-term loans 4,606,936 7,367,992
Accounts payable and accrued
liabilities 1,910,459 2,861,860
Progress advances on productions
in process 6,122,351 10,662,565
Long-term debts 697,794 1,395,188
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13,337,540 22,287,605
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SHAREHOLDER'S EQUITY
Share capital
Equity component of Class "C" shares - 1,023,078
Class "A" shares and warrents 9,604,497 5,284,754
Deficit (3,053,218) (2,023,048)
Contributed surplus 375,786 -
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6,927,066 4,284,784
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20,264,606 26,572,389
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The accompanying notes are an integral part of these consolidated
financial statements
FRV MEDIA INC.
Consolidated Cash Flows (unaudited)
THREE-MONTH PERIOD NINE-MONTH PERIOD
ENDED DECEMBER 31 ENDED DECEMBER 31
2004 2003 2004 2003
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$ $
OPERATING ACTIVITIES
Net loss 212,277 (155,155) (583,135) (816,661)
Non-cash items:
Stock-based
compensation 6,780 - 16,927 -
Amortization of
property, plant and
equipment 19,809 22,984 95,690 42,990
Loss on disposition
of fixed assets - - 1,246 -
Amortization of
deferred charges 1,315 - 3,943 -
Interest premium
capitalized to
convertible debenture 5,793 35,605 16,876 100,393
Interest allocated to
liability component
of class C shares
(reversed) 13,782 - 90,434 -
Future income taxes - - - -
Gain on settlement
of debt (161,092) - (161,092) -
Changes in assets and
liabilities:
Accounts receivable 52,377 (152,555) 4,178,066 (152,215)
Prepaid expenses 12,816 (3,401) 37,444 7,777
Deferred fees (31,948) (31 948)
Productions in
process and
production under
development (3,025,009) (5,768,496) 2,412,000 (9,799,257)
Accounts payable
and accrued
liabilities (305,242) 266,635 (951,401) (138,978)
Progress advances
on productions
in process 2,613,942 (354,172) (4,540,214) 7,332,821
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Cash flows from
operating
activities (584,400) (6,108,555) 584,835 (3,423,130)
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INVESTING ACTIVITIES
Cash flows obtained
in business
acquisition - - - 4,888
Transaction costs
paid cash - (4,148) - (56,318)
Recoverable
distribution
direct costs (56,989) 29,393 (115,793) 34,733
Investments in
films and
television programs - (20,130) - (326,190)
Balance of sale - - 150,000 175,000
Royalties payable - 2,195 - (105,130)
Purchase of
short-term
investments - (1,761,179) - (2,178,419)
Redemption of
short-term
investments (2,733,098) 2,399,239 (1,100,331) 2,996,185
Purchase of
property, plant
and equipment (35,470) (17,288) (71,318) (127,682)
---------------------------------------------------------------------
Cash flows from
investing
activities (2,825,557) 628,082 (1,137,442) 417,067
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FINANCING ACTIVITIES
Short-term loans 990,293 4,562,720 (2,761,056) 3,287,176
Increase in
long-term debts - 5,460 - 125,000
Share Issue Costs (277,809) (6,525) (277,809) (6,525)
Repayment of loan
to a shareholder - - (32,231) -
Repayment of
long-term debt (36,783) (34,969) (135,378) (362,163)
Issue of Class
A shares 3,000,000 273,750 3,010,297 953,750
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Cash flows from
financing
activities 3,675,701 4,800,436 (196,177) 3,997,238
---------------------------------------------------------------------
Net increase
(decrease) in cash 265,744 (680,037) (748,784) 991,175
Cash, beginning of
period 411,634 1,864,998 1,426,162 193,786
---------------------------------------------------------------------
Cash, end of period 677,378 1,184,961 677,378 1,184,961
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The accompanying notes are an integral part of these consolidated
financial statements
Notes to Financial Statements of December 31, 2004 (unaudited) 1.GOVERNING gov·ern v. gov·erned, gov·ern·ing, gov·erns v.tr. 1. To make and administer the public policy and affairs of; exercise sovereign authority in. 2. STATUTES AND NATURE OF OPERATIONS The Company was incorporated on October October: see month. 20, 1998 under the Canada Business Corporations Act The Canada Business Corporations Act, also known as Bill C-44, is a Canadian act respecting Canadian business corporations. See also
Before October 30, 2002, the Company was in the development stage and its sole purpose was the search for business acquisitions that would qualify as an acquisition as defined by the TSX Venture Exchange TSX Venture Exchange Originally called the Canadian Venture Exchange (CDNX), this was a result of the merger of the Vancouver and Alberta stock exchanges. The goal of TSX Venture Exchange is to provide venture companies with effective access to capital while protecting investors. . On October 30, 2002 and August 29, 2003 the Company acquired Cite-Amerique Inc. and Altau Inc. Since then, the Company produces and distributes TV series, made-for-TV movies and feature films. In January 2004, the Company acquired Romcom Inc. (INEO), a firm operating in the organization of events and Education Training Career fairs and many Training Symposiums for corporate managers. 2. SIGNIFICANT ACCOUNTING POLICIES The accompanying ac·com·pa·ny v. ac·com·pa·nied, ac·com·pa·ny·ing, ac·com·pa·nies v.tr. 1. To be or go with as a companion. 2. unaudited financial statements are in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting applicable for interim financial statements and do not include all of the information required for complete financial statements. These financial statements are also consistent with the accounting policies described in the Company's financial statements for the year ended March 31, 2004 except for the modification in the accounting policy related to stock-based compensation described below. The interim financial statements and notes thereto there·to adv. 1. To that, this, or it. 2. Archaic In addition to that; furthermore. thereto Adverb Formal 1. to that or it 2. should be read in conjunction with the Company's audited consolidated financial statements Consolidated Financial Statements The combined financial statements of a parent company and its subsidiaries. Notes: Because consolidated financial statements present an aggregated look at the financial position of a parent and its subsidiaries, they enable you to gauge for the year ended March 31, 2004. Where necessary, the financial statements include amounts determined according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. insightful estimates and management's best judgment. The results of operations for the interim periods presented are not necessarily representative of expected results for the year. 3. ACCOUNTING POLICY MODIFICATION On April 1, 2004, the Company adopted, retroactively ret·ro·ac·tive adj. Influencing or applying to a period prior to enactment: a retroactive pay increase. [French rétroactif, from Latin , the revised recommendations of the Canadian Institute of Chartered Accountants The Canadian Institute of Chartered Accountants (CICA) is the umbrella body for the Chartered Accountant profession in Canada and Bermuda. Membership of the CICA totals 70,000 Chartered Accountants and 8,500 students. ("CICA CICA Competition In Contracting Act of 1984 (USA) CICA Canadian Institute of Chartered Accountants CICA Competition In Contracting Act CICA Criminal Injuries Compensation Authority (UK) ") Handbook
This article is about reference works. For the subnotebook computer, see .
The phrase pro forma disclosures of net earnings and earnings per share as if the fair value method of accounting had been applied. The fair value of the options granted during the year ended March 31, 2004 was estimated using the Black-Scholes option-pricing model Black-Scholes option-pricing model A model for pricing call options based on arbitrage arguments. Uses the stock price, the exercise price, the risk-free interest rate, the time to expiration, and the expected standard deviation of the stock return. with the following assumptions: an expected life of five years, a risk-free Adj. 1. risk-free - thought to be devoid of risk riskless, unhazardous safe - free from danger or the risk of harm; "a safe trip"; "you will be safe here"; "a safe place"; "a safe bet" semi-annual interest rate of 4.55% and an expected volatility Volatility 1. A statistical measure of the tendency of a market or security to rise or fall sharply within a period of time. 2. A variable in option pricing formulas that denotes the extent to which the return of the underlying asset will fluctuate between now and the of 92%. The weighted average fair value of options granted during the year ended March 31, 2004 was $0.184 ($0.1825 for the year ended March 31, 2003). On April 1, 2004, the Company adopted a retroactive Having reference to things that happened in the past, prior to the occurrence of the act in question. A retroactive or retrospective law is one that takes away or impairs vested rights acquired under existing laws, creates new obligations, imposes new duties, or attaches a application without restating prior periods as follows:
- Fair value of options granted applied to deficit $(169,225)
- Fair value of option granted applied
to contributed surplus $169,225
This table does not take into account options granted before January
1, 2002.
4. ACCOUNTING FOR COMPENSATION PLANS
The fair value of granted stock options was estimated with the Black-
Scholes model of evaluation of the price of options using an expected
life of five years, a semi-annual interest rate without risk of 4.55%
and volatility of 92%. A compensation expense is charged over the
option acquisition period.
Three months Three months Nine months Nine months
ended ended ended ended
December 31, December 31, December 31, December 31,
2004 2003 2004 2004
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Net Profit
(Net Loss)
presented $212,276 $(155 155) $(583,135) $(816,661)
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Plus:
Compensation
expense
recognized in
the results $6,780 - $16,927 -
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Less:
Total compensation
expense $(6,780) - $(16,927) $(68,932)
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Pro forma Net
Profit (Net Loss) $212,276 $(155,155) $(583,135) $(885,593)
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Pro forma net
profit (Net Loss)
per share $0.01 $(0.01) $(0.02) $(0.04)
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5. EARNINGS PER SHARE
The following items were not included in the calculation of earnings
per share dilution because these instruments would have been anti-
dilutive for the periods presented.
NUMBER OF INSTRUMENTS
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December 31, December 31,
2004 2003
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- Options
- Options, exercise price of $0.15 411,667 471,667
- Options, exercise price of $0.25 869,500 -
- Options, exercise price of $0.35 118,000 871,500
- Options, exercise price of $0.40 166,000 168,000
- Options, exercise price of $0.60 50,000 -
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1,615,167 1,511,167
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- Convertible debenture,
conversion price of 0.30$ 333,333 333,333
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- Warrants 5,319,882 607,143
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6.SEGMENTED INFORMATION The Company operates exclusively in the fields of television and films since November 2002. For the semester se·mes·ter n. One of two divisions of 15 to 18 weeks each of an academic year. [German, from Latin (cursus) s ended September September: see month. 30, 2004 and September 30, 2003, the Company has not recorded any foreign revenue. 7. NEW SHARES ISSUE On November 4, the Solidarity Solidarity, Polish independent trade union federation formed in Sept., 1980. Led by Lech Wałęsa, it grew rapidly in size and political power and soon posed a threat to Poland's Communist government by its sponsorship of labor strikes and other forms of Fund QFL QFL Quebec Federation of Labour (Canada) QFL Queensland Football League QFL Quoted for Lies (internet slang) QFL Qualified Products List (the "Solidarity Fund") and the Fonds
Fonds is an archival term used to describe a collection of papers that originate from the same source. de developpement de la CSN CSN Crosby, Stills, and Nash (band) CSN Centrala studiestödsnämnden (Swedish: state education grant and loan program) CSN Confédération des Syndicats Nationaux (French) pour la cooperation et l'emploi ("Fondaction CSN") concluded a major investment in FRV Media. As part of this investment, FRV Media has already received $3 million and has access, at its discretion, to another $3 million over the next two years. The amount FRV has already received is payment for 6,000,000 units, each of which consists of one Class A share and a half warrant. Each unit is issued at a price of $0.50. Each warrant is exercisable within 24 months at a price of $0.60 per share until May 4, 2006 or $0.75 until November 4, 2006.The remaining $3 million will be in exchange for debentures convertible into Class A shares. These debentures may be issued at the request of FRV Media by November 4, 2006. They are redeemable Redeemable Eligible for redemption under the terms of an indenture. on the fifth anniversary of their issue and will be convertible by the holders as September 1, 2009 at the average closing price for 20 consecutive days of trading prior to the conversion minus the maximum discount allowed by the Stock Exchange Policies, the conversion rate being no lower than $0.50. The debentures will bear interest at a rate of 10% per year. The interest will be capitalized during the first 24 months following the issue of each debenture debenture (dəbĕn`chər), document acknowledging indebtedness. In Great Britain a debenture is practically the same as a bond, and debenture stock is similar to preferred stock. and payable on a quarterly basis thereafter. We will use the proceeds of this investment to finance the expansion of its distribution and exporting activities. As part of this financing, the Company may also issue an additional $2 million in debentures to other investors. Concurrent At the same time. It implies that multiple processes are taking place simultaneously. See concurrent operation. with this transaction, FRV Media converted 5,600,000 Class C shares held by Capital d'Amerique CDPQ CDPQ Caisse de Dépôt et de Placement du Québec inc. ("CDPQ") and the Fonds d'investissement de la culture et des communications ("FICC FICC Fixed Income Clearing Corporation FICC Federal Identity Credentialing Committee FICC Federal Interagency Coordinating Council FICC Fixed Income, Currency and Commodities FICC Frequency Interference Control Center ") into an equal number of Class A shares.These shares had a put option that the Class A shares do not have. As compensation, FRV Media issued to CDPQ and FICC 680,000 Class A shares and 1,212,739 warrants with the same characteristics as the warrants issued to the Solidarity Fund and Fondaction CSN. 8.SEGREGATED INVESTMENTS The investment of the Fonds de solidarite FTQ FTQ Fédération des Travailleurs du Québec FTQ First Time Quality FTQ Fetch Target Queue FTQ Fond de Solidarité de La Fédération des Travailleurs du Québec (the "Solidarity Fund") and the Fonds de developpement de la CSN pour la cooperation et l'emploi ("Fondaction CSN") during the quarter, of which $3 million has already been cashed, will be used exclusively to finance the distribution and export activities of our subsidiary FRV Media International.
9. OTHER FINANCIAL INFORMATION
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FINANCIAL FEB. 23, DEC. 31, JUNE 30, MARCH 31,
INSTRUMENTS 2005 2004 2004 2004
OUTSTANDING
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Class "A" shares 34,685,758 34,685,758 21,374,758 21,341,758
Class "C" shares 0 0 5,600,000 5,600,000
Options 1,615,167 1,615,167 1,528,167 1,561,167
Warrants 5,319,882 5,319,882 1,107,143 1,107,143
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FRV Media Inc. (TSX VENTURE:FRV) |
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