TIMES MEDIA GROUP LIMITED - Unaudited Condensed Consolidated Group Financial Results for the six months ended 31 December 2014

Release Date: 30/03/2015 15:00
Code(s): TMG
 
Wrap Text
Unaudited Condensed Consolidated Group Financial Results for the six months ended 31 December 2014

TIMES MEDIA GROUP LIMITED  
Incorporated in the Republic of South Africa
Registration number: 2008/009392/06
Share code: TMG ISIN: ZAE000169272
("Times Media Group" or "Times Media" or "TMG" or "the Company" or "the Group")

UNAUDITED 
CONDENSED CONSOLIDATED
GROUP FINANCIAL RESULTS
for the six months ended 31 December 2014

HIGHLIGHTS

- TMG now has a footprint in East and West Africa through Kenya and Ghana
- TMG has exposure to 16 radio stations throughout Africa 
- Kenya radio achieved a record profit for the 6 month period
- 3 out of 7 newspapers grew circulation
- TMG's Media Division increased market share of advertising spend
- Digital business growing and profitable
- All print newspapers are profitable
- Moved up to a level 2 BEE contributor with value add

Condensed consolidated statement of profit or loss
and other comprehensive income
                                                            Six months    Six months
                                                                 ended         ended
                                                           31 December  3 1 December
                                                                  2014          2013
                                                                    Rm            Rm
CONTINUING OPERATIONS
Revenue                                                          2 108         2 092
Cost of sales                                                  (1 530)       (1 530)

Gross profit                                                       578           562
Operating expenses                                               (406)         (391)

Operating costs                                                  (339)         (330)
Depreciation                                                      (40)          (34)
Amortisation                                                      (17)          (15)
Share-based payments                                              (10)          (12)

Profit from operations before exceptional items                    172           171
Exceptional items                                                 (28)           155

Profit from operations                                             144           326
Net finance costs                                                 (21)          (22)

Finance income                                                       1            12
Finance costs including interest paid
 on cash flow hedges                                              (22)          (34)

Share of (losses) profits of associates
 and joint ventures (net of income tax)                            (5)             6

Profit before taxation                                             118           310
Taxation                                                          (38)          (89)

Profit from continuing operations                                   80           221

DISCONTINUED OPERATIONS
Profit from discontinued operations                                 20           257

(Loss) profit after taxation before profit on disposals           (25)            24
Profit on disposals (net of capital gains tax)                      45           233

Profit for the period                                              100           478

Other comprehensive income (loss)
Items that may be reclassified subsequently
  to profit or loss
Change in fair value of cash flow hedges
 (net of income tax)                                                 –           (8)
Exchange differences on translation of
 foreign operations                                                  1           (4)

Other comprehensive income (loss) for the
 period (net of income tax)                                          1          (12)

Total comprehensive income for the period                          101           466

Profit (loss) attributable to:
Owners of the Company                                              104           476

Profit from continuing operations                                   84           218
Profit from discontinued operations                                 20           258

Non-controlling interest                                           (4)             2

(Loss) profit from continuing operations                           (4)             3
(Loss) profit from discontinued operations                           –           (1)

Profit for the period                                              100           478

Total comprehensive income (loss) attributable to:
Owners of the Company                                              105           464

Profit from continuing operations                                   85           212
Profit from discontinued operations                                 20           252

Non-controlling interest                                           (4)             2

(Loss) profit from continuing operations                           (4)             3
(Loss) profit from discontinued operations                           –           (1)

Total comprehensive income for the period                          101           466

Earnings per ordinary share
 from continuing operations
Basic                                             (cents)           66           172
Diluted                                           (cents)           66           171
Earnings per ordinary share
 from discontinued operations
Basic                                             (cents)           16           203
Diluted                                           (cents)           15           202
Earnings per ordinary share from
 continuing and discontinued operations
Basic                                             (cents)           82           375
Diluted                                           (cents)           81           373

Condensed consolidated statement of financial position

                                                    As at        As at         As at
                                              31 December  31 December       30 June
                                                     2014         2013          2014
                                                       Rm           Rm            Rm
ASSETS
Non-current assets                                  1 740        1 565         1 669

Property, plant and equipment                         374          379           380
Intangible assets                                     865          879           821
Interests in associates and joint
  ventures                                            416          174           376
Investments                                             –           10             2
Long-term receivable                                    –            8             8
Deferred taxation assets                               85          115            82

Current assets                                      1 203        1 526         1 249

Inventories, receivables and
  other current assets                              1 162        1 390         1 202
Bank balances, deposits and cash                       41          136            47

Non-current assets classified
 as held for sale                                      95          162           203

Total assets                                        3 038        3 253         3 121

EQUITY AND LIABILITIES
Total equity                                        1 564        1 643         1 528

Equity attributable to owners
 of the Company                                     1 570        1 638         1 528
Non-controlling interest                              (6)            5             –

Non-current liabilities                               506          528           514

Long-term borrowings                                  352          385           366
Post-retirement benefits liabilities                   87           78            85
Operating leases equalisation liabilities              29           22            24
Deferred taxation liabilities                          38           43            39

Current liabilities                                   956        1 041         1 047

Payables and other current liabilities                870          963           947
Short-term borrowings                                  63           66            48
Post-retirement benefits liabilities                    9            9             9
Bank overdrafts                                        14            3            43

Liabilities directly associated with
 non-current assets classified as
 held for sale                                         12           41            32

Total equity and liabilities                        3 038        3 253         3 121

Condensed consolidated segmental statement
                                                            Six months    Six months
                                                                 ended         ended
                                                           31 December   31 December
                                                                  2014          2013
                                                                    Rm            Rm
CONTINUING OPERATIONS
Segmental revenue from external customers
Media                                                              968         1 012
Broadcasting and Content                                           205           213
Retail Solutions                                                   935           867

                                                                 2 108         2 092
Segmental profit (loss) from operations before
exceptional items
Media                                                               91            90
Broadcasting and Content                                            11            24
Retail Solutions                                                   101            86

                                                                   203           200
Corporate                                                         (21)          (17)

                                                                   182           183
Share-based payments                                              (10)          (12)

                                                                   172           171

Condensed consolidated statement of cash flows
                                                            Six months    Six months
                                                                 ended         ended
                                                           31 December   31 December
                                                                  2014          2013
                                                                    Rm            Rm

Net cash flows from operations                                     169           210
Net finance costs including interest paid
 on cash flow hedges                                              (21)          (21)
Taxation paid                                                     (33)          (33)

Net cash flows from operating activities                           115           156
Net cash flows from investing activities                          (36)           233
Net cash flows from financing activities                          (52)         (267)

Net increase in cash and cash equivalents                           27           122
Cash and cash equivalents at the beginning of the period            40            59
Foreign operations translation adjustment                            –           (1)

Cash and cash equivalents at the end of the period                  67           180

Condensed consolidated statement of changes in equity
                                                                                                                     Non-
                                                                     Share     Other  Accumulated    Owners'  controlling    Total
                                                                   capital  reserves      profits  interest      interest   equity
                                                                        Rm        Rm           Rm        Rm            Rm       Rm

Balance at 30 June 2013                                              1 724   (1 133)          571     1 162            46    1 208
Profit attributable to owners of the Company                             –         –          476       476             2      478
Change in fair value of cash flow hedges (net of income tax)             –       (8)            –       (8)             –      (8)
Exchange differences on translation of foreign operations                –       (4)            –       (4)             –      (4)
Effect of acquisitions and disposals of non-controlling interests        –         –            –         –          (37)     (37)
Equity-settled share incentive plans                                     –        12            –        12             –       12
Dividends paid by subsidiaries to non-controlling interests              –         –            –         –           (6)      (6)

Balance at 31 December 2013                                          1 724   (1 133)        1 047     1 638             5    1 643

Balance at 30 June 2014                                              1 724   (1 135)          939     1 528             –    1 528
Profit (loss) attributable to owners of the Company                      –         –          104       104           (4)      100
Effect of acquisitions and disposals                                     –      (20)            –      (20)             –     (20)
Effect of acquisitions and disposals of non-controlling interests        –       (8)            –       (8)           (2)     (10)
Equity-settled share incentive plans                                     –        10            –        10             –       10
Dividends paid                                                           –         –         (44)      (44)             –     (44)

Balance at 31 December 2014                                          1 724   (1 153)          999     1 570           (6)    1 564

Notes

1. Basis of preparation

   The unaudited condensed consolidated Group financial results for the six
   months ended 31 December 2014 have been prepared and presented in
   accordance with the International Financial Reporting Standard IAS 34:
   Interim Financial Reporting, the framework concepts and the measurement
   and recognition requirements of International Financial Reporting Standards
   (IFRS), the SAICA Financial Reporting Guides as issued by the Accounting
   Practices Committee and the Financial Reporting Pronouncements as issued
   by the Financial Reporting Standards Council, the JSE Limited's Listings
   Requirements, and the requirements of the South African Companies Act
   No 71 of 2008 (as amended). The accounting policies are compliant with
   IFRS, and their application is consistent, in all material respects, with those
   detailed in TMG's 2014 integrated annual report, apart from the adoption,
   from 1 July 2014 up to the reporting date, of those new and amended IFRS
   statements and interpretations with effective dates for the Company of 1
   July 2014 up to the reporting date, and those amendments included in the
   International Accounting Standards Board's annual improvements project
   where such amendments were effective for the Company from 1 July 2014 up
   to the reporting date. The adoption of the new and amended IFRS statements
   and interpretations, and improvements project amendments, has not had a
   material effect on the Company's financial results.

   In compliance with IFRS 5: Non-current Assets Held for Sale and Discontinued
   Operations, the relevant comparative financial information has been re-
   presented.

   The preparation of these condensed consolidated Group interim financial
   statements was supervised by TMG's financial director, Mr W Marshall-Smith
   CA(SA).

                                                        Six months     Six months
                                                             ended          ended
                                                       31 December    31 December
                                                              2014           2013
                                                                Rm             Rm
2. Exceptional items

   CONTINUING OPERATIONS
   Media
   – Retrenchment costs                                       (10)            (5)

   Broadcasting and Content                                      –            (5)
   – Gain on disposal of Ponte advertising site                  –             11
   – Impairment of goodwill                                      –           (16)
   Retail Solutions                                           (11)            (3)
   – Profit on sale of Universal Web assets                      –              8
   – Costs related to closure of Universal Web                 (3)            (3)
   – Costs related to Ferroprint acquisition                   (1)              –
   – Costs related to closure of businesses                    (1)              –
   – Legacy balances and legal matters                         (2)              –
   – Retrenchment costs                                        (4)            (8)
   Corporate                                                   (7)            168
   – Revaluation of listed investments                           –              1
   – Profit on disposal of listed investments                    –              1
   – Post-retirement medical aid                               (6)            169
   – Costs related to acquisitions                               –            (2)
   – Retrenchment costs                                        (1)            (1)

                                                              (28)            155
3. Reconciliation between earnings
    and headline earnings

   CONTINUING OPERATIONS
   Earnings                                                     84            218
   Profit on disposal of property, plant
    and equipment                                                –            (8)
   Profit on disposal of intangible assets                       –           (10)
   Impairment of goodwill                                        –             16
   Revaluation of listed investments                             –            (1)
   Profit on disposal of listed investments                      –            (1)
   Tax effect                                                    –              6
   Attributable to non-controlling interest                      –              –
   Headline earnings                                            84            220

   Headline earnings per ordinary share
    from continuing operations
   Basic                                      (cents)           66            173
   Diluted                                    (cents)           66            172

   DISCONTINUED OPERATIONS
   Earnings                                                     20            258
   Profit on disposal of interests in companies
    and businesses                                               –          (259)
   Loss on disposal of property, plant and equipment             –              2
   Profit on disposal of properties                           (51)            (9)
   Impairment of intangible assets                              25              1
   Tax effect                                                    7             36
   Attributable to non-controlling interest                      –              –
   Headline earnings                                             1             29
   Total headline earnings from continuing
    and discontinued operations                                 85            249
   Headline earnings per ordinary share
    from discontinued operations
   Basic                                      (cents)            1             23
   Diluted                                    (cents)            1             23
   Headline earnings per ordinary share from
    continuing and discontinued operations
   Basic                                      (cents)           67            196
   Diluted                                    (cents)           67            195

4. Earnings per ordinary share

   The calculation of basic earnings and headline earnings per ordinary
   share for the six months ended 31 December 2014 is based on earnings of
   R104 million (2013: R476 million) and headline earnings of R85 million
   (2013: R249 million), respectively, and on a weighted average of 126 470 412
   ordinary shares in issue (2013: 127 047 179 shares).

   The calculation of diluted earnings and headline earnings per ordinary
   share for the six months ended 31 December 2014 is based on earnings of
   R104 million (2013: R476 million) and headline earnings of R85 million (2013:
   R249 million), respectively, and on a weighted average of 128 018 541 diluted
   ordinary shares in issue (2013: 127 526 675 shares). The additional diluted
   ordinary shares arise as a result of equity-settled share incentives in issue.

5. Discontinued operations

   The following assets comprise TMG's discontinued operations:
   Media

   -  Industria property (disposed of on 26 September 2014)
   -  I-Net Bridge (disposed of on 15 November 2013)
   -  East London properties (disposed of on 10 October 2013)
   -  Port Elizabeth property

   Broadcasting and Content
   -  Boo Media (disposed of on 1 May 2014)
   -  Interactive Junction Holdings (disposed of on 6 January 2015)

   Retail Solutions
   -  Bedfordview property (disposed of on 13 August 2014)

   Books
   -  Van Schaik Bookstore (disposed of on 2 December 2013)
   -  Exclusive Books (disposed of on 1 December 2013)
   -  New Holland Publishing (Lovell Johns disposed of on 1 November 2014,
      New Holland Publishing Australia and New Zealand disposed of on
      1 July 2014, Map Studio disposed of on 30 June 2014, Random House
      Struik disposed of on 25 November 2013, Mega Digital disposed of on
      1 November 2013 and Struik Christian Media disposed of on 29 July 2013)

   Entertainment
   -  Nu Metro Cinemas including Popcorn Cinema Advertising Sales
      (disposed of on 28 November 2013)
   -  40% interest in Warner Music Gallo Africa (disposed of on 31 July 2013)

                                                       Six months     Six months
                                                            ended          ended
                                                      31 December    31 December
                                                             2014           2013
                                                               Rm             Rm
  
  Revenue                                                      62            818
  Cost of sales                                               (7)          (425)
  Gross profit                                                 55            393
  Operating expenses                                         (54)          (363)
  Operating costs                                            (51)          (340)
  Depreciation                                                (1)           (19)
  Amortisation                                                (2)            (4)
  
  Profit from operations before
   exceptional items                                            1             30
  Exceptional items                                          (27)            (3)
  (Loss) profit from operations                              (26)             27
  Net finance costs                                             –              1
  Finance income                                                –              2
  Finance costs                                                 –            (1)
  Share of profits of associates (net of income tax)            –              1
  (Loss) profit before taxation                              (26)             29
  Taxation                                                      1            (5)
  (Loss) profit after taxation before
   profit on disposals                                       (25)             24
  Profit on disposals (net of capital gains tax)               45            233
  Profit on disposal of properties                             51              9
  Profit on disposal of I-Net Bridge                            –             85
  Profit on disposal of Van Schaik Bookstore                    –            116
  Profit on disposal of Exclusive Books                         –             66
  Profit on disposal of Random House Struik                     –              7
  Loss on disposal of Nu Metro Cinemas
   and Popcorn Cinema Advertising Sales                         –           (15)
  Capital gains tax                                           (6)           (35)
  
  Profit from discontinued operations                          20            257
  
  Segmental revenue from external customers
  Media                                                         –             54
  Broadcasting and Content                                     29             50
  Books                                                        33            577
  Entertainment                                                 –            137
                                                               62            818
  Segmental profit (loss) from operations
   before exceptional items
  Media                                                         –            (1)
  Broadcasting and Content                                      –            (1)
  Books                                                         1             31
  Entertainment                                                 –              1
                                                                1             30
  Segmental exceptional items
  Broadcasting and Content                                   (27)              –
  – Impairment of goodwill                                   (25)              –
  – Costs relating to disposal of businesses                  (1)              –
  – Retrenchment costs                                        (1)              –
  Books                                                         –            (3)
  – Impairment of Exclusives.co.za                              –            (1)
  – Retrenchment costs                                          –            (2)
  
                                                             (27)            (3)
  Assets and liabilities of discontinued
   operations classified as held for sale
  Non-current assets                                           20              6
  Current assets                                               75            156
  Non-current liabilities                                       3              9
  Current liabilities                                           9             32
  Cash flow information
  Net cash flows from operations                                4             19
  Interest received                                             –              1
  Taxation refunded                                             –              3
  Net cash flows from operating activities                      4             23
  Net cash flows from investing activities                     75           (71)
  Net cash flows from financing activities                   (10)             35
  Foreign operations translation adjustment                     –            (1)
  Cash flows from discontinued operations                      69           (14)

Commentary

INTRODUCTION

The trading conditions for the six months ended December 2014 were challenging
across our Group's divisions. Despite this, TMG managed to hold operating profit
steady. We have done a lot of work across divisions and companies to align our cost
base with revenue as well as invest in areas where we believe we can generate good
returns on our capital. Last year we began cleaning up some legacy issues in our Media
Division and during this period we continued with these initiatives. Our intention is to
take unnecessary expenses and costs out of Media so that we can strengthen our core
operations which are good at content generation. We are reticent to follow the herd
in a digital strategy that has no possibility of generating a return on investment. Our
approach is measured and commercially driven.

Our investment in Kenya has surpassed our expectations and has had a record six
months driven by a strong management team and a robust radio advertising market,
while Ghana's tough macroeconomic environment has affected the consumer and had
a knock on effect on our investment. Television operations continue to struggle in the
country but radio remains less affected by the downturn. The Cedi has devalued by
some 19% against the Rand over calendar 2014 which hasn't helped.

Group turnover from continuing operations was R2,108 billion and operating profit
before exceptional items from continuing operations was R172 million.

We have begun looking at our businesses' processes, cash flow generation, general
efficiencies and other pertinent areas across the Group which is already yielding
results.

MEDIA

Profits from our Media Division remained steady despite revenue falling by 4%.
(Advertising in the corresponding six months was unusually high because it included
spend associated with the death of Nelson Mandela). Despite the decline we continued
to grow our advertising market share at the expense of our main competitors. In total
we have grown market share by three percentage points over the past three years.

EBITDA for the period was R102 million (2013: R100 million), despite R10 million in
retrenchment costs and a decline in turnover for the period under review. Depreciation
was higher than usual due to increased investment in IT.

Three of our titles (The Times, the Sowetan and Daily Dispatch) were amongst the
five dailies to grow circulation while most other competitors' titles suffered steep
declines. The Times in particular has cemented its position as the biggest quality daily
paper in the all-important Johannesburg market. The circulation of the rest of the titles
was steady. All TMG newspaper individual titles were profitable for the period and
continue to be. We have also maintained margins for all the newspaper titles. We also
managed to turn Financial Mail around which registered a profit for the six month
period and continues to trade profitably. Since TMG has owned 100% of Business Day
we have seen a remarkable recovery and the title now trades very profitably.

Our magazine division continued to enjoy robust profit growth primarily due to the
launch of new titles targeted at our existing newspaper subscribers. As a result of
the success achieved by Wanted (Business Day) and Business Class (Sunday Times)
we plan to launch a series of new titles in the next six months. The first of these, a
fashion magazine (The Edit) which will be inserted into the Sunday Times is attracting
strong support from advertisers seeking a new home following the collapse in sales of
women's consumer magazines. SA Homeowner grew its sales by 4,5% at a time when
consumer magazines as a whole experienced a 4% decline.

Our digital division grew revenue by 30% on the back of a 59% growth in unique
browsers across our network. TMG now attracts over 6 million unique browsers. Our
premier site, TimesLive, grew by more than 300% year-on-year and in the period
under review became the second largest news website in SA fast closing in on the top
news site. We are in the process of upgrading our editorial system to enable our staff to
work seamlessly between print, mobile and internet.

During the period we also launched Rand Daily Mail online which has quickly become
very popular with audiences having grown to over 219 000 unique browsers in
February 2015, a growth of 472% over the previous month. Rand Daily Mail has quickly
become a leader in the opinion segment of journalism. Further Times Media digital
properties are in the pipeline. Our digital is run on strictly commercial considerations,
which means we only invest capital if we can generate an adequate return. As a result,
our digital division is profitable and growing.

We are constantly reviewing our operations and in the period under review had one-
off retrenchment costs of R10 million.

BROADCASTING AND CONTENT

Our Broadcast and Content Division ("B&C") is our newest division, and in its growth
phase where we have invested capital and time in order to achieve our objectives. B&C
comprises businesses in South Africa and across the African continent. Profitability in
South Africa is lower overall as a result of investment in certain early stage businesses
such as radio and reinvestment in our TV assets, but core divisional revenues were
steady despite soft advertising markets. As a result of investment costs the division
reported an EBIT decline from continuing operations of R13 million to R11 million.
Revenues were steady or up across all businesses with the exception of TV production,
which is by nature highly cyclical, and our non-core outdoor assets. Whilst in its early
stages, the division represents TMG's core medium to long term growth opportunity.
Our businesses outside of South Africa and joint ventures are reported under share of
associates and joint ventures and not in the B&C segmental income statement.

The division comprises:

- Radio Africa Group (Kenya)
- MultiMedia (Ghana)
- One Africa (formerly ABC)
- Ochre Moving Pictures
- Vuma FM and Rise FM
- Times Media Films
- Music (Gallo, Bula and Sheer)
- Digital

Rest of Africa

Radio Africa Group ("RAG") in Kenya is the leading independent radio business in
Kenya and owns three of the top five radio stations in Nairobi: Jambo, Classic and Kiss.
RAG also owns the Star newspaper and TV platform, Bamba TV. RAG delivered record
earnings for the first half performance driven by radio (RAG EBITDA was R32 million
for the 6 month period, being a growth of 14%). The Star newspaper is relatively small
but profitable. Bamba TV is a free-to-air Digital Terrestrial Television ("DTT") platform
that launched in December 2014 as Kenya switched over to a new DTT broadcast
environment. TMG owns 49% of RAG.

In Ghana, 32% held MultiMedia Group has a strong pedigree as the leading
independent broadcaster in the country. Multimedia's leading radio stations Joy and
Adom command significant audience and advertising market share and its TV platform
Multi TV has over 2 million boxes in homes in Ghana and more across the rest of west
Africa. The business has been hampered by weak macro-economic and advertising
markets but radio has been resilient and boasts a strong established team and loyal
audience. Multi TV remains under pressure in terms of establishing a solid advertising
base and has recently consolidated its positioning to focus on key TV channels where
it has dominant market positions in terms of programming. As an advertising led
business it will rely on an improvement in economic performance in the country.

We are in the final stages of purchasing a significant minority stake in two Ugandan
radio stations and in two separate deals, majority shareholdings in a Namibian
TV station and a radio business. These acquisitions will extend our footprint in Africa
and enhance our radio sales ability across our various stations. TMG now has equity
exposure to 16 radio stations throughout Africa, from none two years ago.

South Africa

Content

Our content businesses are showing growth as increased focus on all rights
ownership and their commercialisation yields results. The films distribution
business, which owns rights to various international and local films which are then
sold into platforms such as theatres, TV and video on demand (VOD), operates in a
fast changing market and has good short to medium term prospects. The business
is committed to investing in local and international production and distribution
to ensure its future sustainability. Our physical home entertainment business is
in managed decline in line with the reduced consumption of DVDs in the market.
The independent film distribution market has become highly competitive with large
dominant players entering the content acquisition market.

Gallo Music is the largest independent music catalogue in South Africa and has been
bolstered by the acquisition of additional music catalogues namely, Bula Music and
Sheer Sound. The acquisitions bring increased scale in terms of music and artists, in
the face of declining physical markets. Digital income continues to build but growth
has yet to match the decline in physical markets. Our music business is in the process
of transforming into a 360 degree offering including events and artist management
with a broad market-wide offering. Our objective is to supply our music content to a
number of different platforms. We believe the music business holds significant value in
the long term if it invests prudently and is commercially focused.

Our TV production business, Ochre Moving Pictures, has built a steady base of
productions from which to grow including Scandal, Takalani Sesame and Eksê.

Ochre has succeeded in pitches for certain new South African shows and continues to
develop innovative programming in a competitive market. Ochre works closely with
our TV channels business, One Africa.

Broadcast

Our local broadcast businesses are either in development phase or are being reinvested
in to deliver a sustainable local broadcast platform. As advertising driven businesses
they are subject to cyclical changes.

One Africa, renamed from ABC, houses three satellite TV channels, namely Business
Day TV, Home Channel and Ignition. It has recently invested in new studios and
extending the Ignition channel to a 24 hour offering. It remains profitable and has good
scope for further growth.

Our radio, Vuma FM and Rise FM, are long term investments as it takes time to
establish listenership and build market share from an audience and revenue
perspective. The unit is an early stage development business with two start up regional
radio stations still establishing a footprint in their markets. Both Durban based Vuma
and Mpumulanga's Rise FM are producing good listenership growth with advertising
revenues beginning to pick up. The radio business has also invested in sales capacity
to service other stations such as 99fm in Namibia and North West FM in Rustenburg
as well as Rise and Vuma.

Digital

50%-owned Smartcall Technology Services ("STS") is showing strong revenue growth
in mobile services, providing products across sub-Saharan Africa. For the 11 months
ended January 2015, STS increased turnover by 36% and EBIT by 58%. The STS
business holds and manages video-on-demand platform VIDI, which remains in early
investment stage. The offering has been well received by the market, but will require
further development of South Africa's broadband infrastructure to reach acceptable
operating levels. VOD services require a depth of content which is expensive to
procure in order to attract and maintain sufficient subscribers. The South African
market is unaccustomed to the VOD model and therefore a consistent customer
education campaign is required to boost take up. VOD has many benefits to consumers
compared to pay and linear TV and is growing in leaps and bounds globally. VIDI is in
effect a movie rental store in your home.

TMG sold its Interactive Junction business to Saon Group in January 2015 as part of the
strategy to dispose of non-core assets. Further smaller sales remain to be finalised but
the balance of the division now forms the core of the Group's growth strategy going
forward.

RETAIL SOLUTIONS

Hirt and Carter ("H&C")

The trading environment for the 6 months to December 2014 for H&C proved
challenging with continued pressure on pricing and margin.

The effect of overall macro-economic influences in the economy has had a specific
bearing on disposable income per capita from a consumer perspective in the retail
sector which is where H&C operates in.

Despite difficult trading conditions H&C grew turnover by 6% with a focus on growth
and development of new accounts whilst delivering service excellence to existing
customers.

For the period EBITDA grew 24% to R90 million from R73 million in the comparative
period partly due to T&R and Bates Printing not being reflected for the full comparative
period. Bates Printing has proved to be an excellent acquisition which has brought a
first class management team into H&C. Initiatives are currently underway to merge
H&C and Bates Printing in Cape Town into a single service operation. The merging of
the two operations will enhance efficiencies and improve earnings in the Cape region.
National focus was placed on the H&C cost base by initiating operating expenses
reviews to align expenditure to the ever changing market conditions and to avoid an
inverted value curve in relation to the revenue base. We were successful in reducing
expenditure by 9% over the period. Much of the savings were derived from re-
structuring initiatives in the Gauteng region. The revised business is geared for growth
and expansion.

A key area of focus has been to improve H&C's return on capital.

The H&C Software Division continues to invest in software development and bespoke
retail system solutions to provide value added services to our customers and to
enhance and assist the communication strategy to customers.

The 30% acquisition in Capacity Holdings provides a platform for an integrated market
solution to enhance digital library content management to our existing and future
customer base. Further investment on software development will grow and expand
the business.

Uniprint

All Uniprint divisions performed well during the six months under review and
achieved a turnover of R306 million compared with the corresponding period last year
of R242 million which represents an increase in turnover of 26%.

Uniprint achieved an EBITDA of R49 million for the period under review compared
with an EBITDA of R31 million for the corresponding period last year, representing an
increase of 58% over the previous year.

Uniprint's increase in operating profit is going to be difficult to maintain at this level
due to the state of the South African economy which has resulted in lower demand
from consumers with the consequence that there is excess capacity in the market. As a
result margins have declined as it has become increasingly difficult to recover cost
increases in a depressed market as a result of a volatile South African Rand against the
US$ and the EURO.

Labels

It has been a very active six months for Uniprint. Uniprint acquired labels business
Ferroprint with effect from 1 June 2014 and the particular focus during the first
6 months was the integration and rationalisation of Ferroprint into Uniprint labels.
Although we still have a way to go we believe we have made good progress in settling
the acquisition and the immediate plans are now to upgrade and improve the
equipment that we acquired.

The Labels Division also secured and commenced execution of the Coke "Connect"
names project for certain east and central African countries in addition to undertaking
the project for the second year in South Africa. This project runs until the end of March
2015.

Exports

During the period under review Uniprint's Export Division was successful in acquiring
an election project for Mozambique which was once off in nature and highly profitable
for Uniprint.

Forms and Direct Mail

The Forms Division has been significantly impacted by the five month strike at the
S A Post Office resulting in several of our major retailers and telcom customers opting
to avoid the use of the post office for delivery of their statements and direct mail to
their customers. This has resulted in Uniprint losing turnover of approximately
R60 million per annum which we perceive to be of a permanent nature. Uniprint will
therefore have to refocus its Forms business to replace the lost turnover. Unfortunately
this will require time and could result in investing in additional capital equipment and
making strategic acquisitions.

Packaging

The Packaging Division was relocated to new premises which offer improved workflow
as well as rationalisation benefits with the Forms Division finished goods warehouse.
Management's focus for the immediate future is as follows:

1. Extract the benefits of the Ferroprint acquisition;
2. Increase our market share in the packaging sector; and
3. Refocus and re-engineer the Forms Division to replace lost turnover due to the
   non-functioning of the S A Post Office and consequential rapid migration to digital
   technology.

BEE

TMG recently moved up to a level 2 BEE contributor with value add supplier status.
A lot of work has been done in the company on transformation and meeting our
empowerment objectives. TMG remains the original media empowerment transaction
where the National Empowerment Consortium acquired control of Johnnic Holdings
from Anglo American in August 1996.

SCHEME OF ARRANGMENT

Shareholders are reminded of the Blackstar led TMG scheme of arrangement in process as
detailed in the February 2015 circular.

For and on behalf of the board

KD Dlamini                                         AD Bonamour
Chairman                                           Chief Executive Officer

Rosebank
30 March 2015

Directors: KD Dlamini (Chairman), AD Bonamour* (Chief Executive Officer),
W Marshall-Smith* (Financial Director), JHW Hawinkels, HK Mehta, R Naidoo,
MM Nhlanhla *Executive      MSM Xayiya resigned with effect from 7 October 2014

Company secretary: JR Matisonn

Email: matisonnj@timesmedia.co.za

Address: 4 Biermann Avenue, Rosebank, 2196, Johannesburg, PO Box 1746,
Saxonwold, 2132

Sponsor: PSG Capital

TIMES MEDIA GROUP LIMITED
Incorporated in the Republic of South Africa
Registration number: 2008/009392/06
Share code: TMG ISIN: ZAE000169272
("Times Media Group" or "Times Media" or "TMG" or "the Company" or "the Group")

These results may be viewed on the internet at www.timesmedia.co.za

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