Annual report for the year ended 31 December 2018
Registered Number 00630968
T-Rex Model, Marwell Zoo, UK, April 2019
LIVE COMPANY GROUP PLC
2018 ANNUAL REPORT
Welcome to the 2018 Annual Report of Live Company Group plc
(“LVCG”, “the Company”, “the Group”) quoted on AIM.
The Strategic Report, set out herein, explains the Company’s strategy,
business model, risk management processes and provides an overview
of current performance and outlook. This is accompanied by a Financial
Reviewfrom the Chief Financial Officer, together with a report from the
Group’s auditors.
The Governance Report explains the role and activities of the Board in
running the business.
The Group’s strategic aim is to build a global children’s education and
entertainment brand focused on creating environments that encourage
interactive play, foster creativity, collaboration and physical experiences
in an inclusive and safe environment.
We are extremely proud of the BRICKLIVE brand, including its brand
extensions, and we foresee the BRICKLIVE brand continuing to grow
globally due to the popularity of the shows, exhibitions, tours and events.
We look forward to continuing to work with our partners, current and
prospective, to present the BRICKLIVE brand to audiences worldwide.
CONTENTS
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Directors and Advisers
Chairman’s Statement
Strategic Report
Chief Financial Officer Report
Corporate Governance Report
Directors’ Report
Directors’ Responsibilities Statement
Report of the Independent Auditor
Consolidated Statement of Comprehensive Income
Statements of Financial Position
Statements of Changes in Equity
Statements of Cash Flows
Notes forming part of the Consolidated Financial Statements
TM
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BRICKLIVE Christmas, Grimaldi Forum, Monaco, December 2018
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Solicitors
Gateley plc
1 Paternoster Sq.
London
EC4M 7DX
Bankers
National Westminster
Bank Plc
2nd Floor
65 Piccadilly
London
W1A 2PP
HSBC Bank Plc
Level 6
71 Queen Victoria Street
London
EC4V 4AY
Registrars
Link Asset Services
65 Gresham Street
London
EC2V 7NQ
Directors
David Ciclitira (Chairman)
Serenella Ciclitira
Ranjit Murugason
Andrew Smith
Bryan Lawrie
Trudy Norris-Grey
Simon Horgan
Public Limited Company
No 00630968 - Incorporated
in England and Wales
Secretary and Registered Office
Sole Associates Accountants
Limited
3 Park Court
Pyrford Road
West Byfleet
Surrey
KT14 6SD
Nominated and
Financial Adviser
Strand Hanson Limited
26 Mount Row
London
W1K 3SQ
Broker
Shard Capital Partners LLP
23rd Floor
20 Fenchurch Street
London
EC3M 3BY
Auditor
Kingston Smith LLP
Devonshire House
60 Goswell Road
London
EC1M 7AD
Force India, Formula 1 brick model, Mexico Grand Prix, Mexico, 2018
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CHAIRMAN'S STATEMENT
BRICKLIVE is a global
brand that focuses
on creating physical
educational and
entertainment experiences
through play and has
been rapidly growing its
presence globally over the
last 18 months.
I have great pleasure in presenting the Group’s Annual
Report, Strategic Report, and Financial Statements for the
year ended 31 December 2018.
Following the completion of the acquisitions at the end of
2017 to create the Live Company Group, 2018 was a year of
significant transformation for the Group.
Key 2018 highlights included:
1. Significant expansion in the number of BRICKLIVE events
and shows held during the year;
2. The launch of the BRICKLIVE Animal Paradise show in
China. In September 2018 BRICKLIVE Animal Paradise was
opened by R.H.S Albert II of Monaco in the prestigious Birds
Nest, Beijing;
3. The launch of the BRICKLIVE brand in America with the
first BRICKLIVE event subsequently held post year end in
January 2019 at The Star in Frisco (Dallas), promoted by
Live Nation in partnership with the Dallas Cowboys; and
4. The £8.5 million acquisition of Bright Bricks Holdings
Limited (“Bright Bricks”) in October 2018, providing the
Group with access to one of the world’s premier brick model
building companies.
2018 saw a significant increase in the number of
BRICKLIVE shows and events, with 34 held globally
compared to only 18 in 2017, in locations as varied as
Birmingham and Glasgow (UK), Turin (Italy), Basel
(Switzerland), Bangkok (Thailand), Rosario (Argentina),
Seoul (South Korea), Tokyo and Osaka (Japan) and
Beijing and Shanghai (China).
The acquisition of Bright Bricks was also an important
milestone for the Group, as the Group has now become
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both a content producer and content provider, with Bright
Bricks being the Group’s production hub. The acquisition has
acted as a spring board for the Group, as it has allowed us to
accelerate our growth plans and to take advantage of new
and existing opportunities that previously we were not able
to fulfil, such as our recent agreement with Nickelodeon UK
Limited (“Nickelodeon UK”) to produce and create themed
tours in the UK and Ireland for some of Nick Jr.’s hit shows.
The Board believes that following the integration of
Bright Bricks, the Group is now one of the most significant
brick-based companies in the world. The acquisition has
also provided the Group with security of supply of bricks,
enhanced speed to the market and increased competitive
advantage whilst raising barriers to entry.
Our growth plans were boosted further following the
£2.2 million equity funding announced in February 2019,
with the funds being used to continue the growth of the
Group’s offering, in particular in respect of expanding the
Group’s BRICKLIVE Zoo programme, which has and
continues to experience significant demand.
As a result of the above, the Group achieved significant
growth in 2018:
• 178% increase in revenues from £1,928,000 in 2017 to
£5,351,000 in 2018; and
• Net assets increasing from £2,844,000 in 2017 up to
£10,627,000 in 2018 as a result of the acquisition.
The Group made an EBITDA profit of £333,000 before
exceptional items, discontinued activities and the Bright
Bricks Q4 losses (2017 – EBITDA loss of £273,000).
The reason for excluding the Bright Bricks Q4 post
acquisition loss of £809,000 is that it distorted the trading
of the core Brick Live business for the final quarter.
Overall the Group’s total loss was £2,610,000 (2017: loss
£5,440,000). The exceptional items included transactional
costs of £1,033,000 which is further explained in Note 7.
I am delighted to report that the Group has made a very
good start to 2019 and that it has a strong pipeline, with
46 shows and events already secured in 2019 with an
expectation to provide 60 events and shows by the end of
the year. As a result and taking into account the Group’s
ability to secure multi-year contracts for shows, events,
activities and corporate builds, as at 31 May 2019, the Group
had already secured contracts with a value of £4.0 million
for 2019, £1.3 million for 2020 and £0.7 million for 2021.
Securing forward sales and multi-year contracts provides
us with significant confidence of the short and medium term
growth strategy and, together with other revenue streams,
our ability to deliver shareholder value.
However, we must not stand still and during 2019, the Group
will focus on five key areas to underpin our growth strategy
as summarised below, with further details set out in the
Strategic Report.
1. Expansion of BRICKLIVE brand in Europe
We are pleased to report that in 2019 the Group has already
secured multi-year partnerships with AWC in Germany,
Pal Expo in Switzerland and Exhibition Hub in Belgium.
The Group has also taken the strategic decision to
self-promote and run the BRICKLIVE show at the NEC
in Birmingham, the Group’s flagship show. This will be the
first year the Group will be responsible for the promotion,
management and operation of the NEC Show which is a
significant step for the Group.
2. Expansion of the BRICKLIVE brand in America
We have already launched the BRICKLIVE brand in Dallas
as well as recently launching BRICKLIVE Animal Paradise in
Brookfield Zoo, Chicago. We are also in discussions to bring
further BRICKLIVE events and shows to America.
3. Foster relationships with global IP partners across
the world
The Group has successfully agreed a multi-year contract
with Nickelodeon UK, one of the world’s leading children’s
entertainment brand. The Board believes that this
partnership is potentially transformational for the Group.
4. The Group is committed to the expansion and
development of a new merchandise range
The Group announced in May 2019 that it had appointed
Licensing Management International Limited as the Group’s
agent in respect of identifying partners for the licensing
and merchandising of BRICKLIVE branded merchandise and
products to be sold at the Group’s BRICKLIVE shows, tours
and events. The Board believes that this will provide an
additional revenue stream for the Group and is a further
diversification of its business.
5. Expansion of the Group’s touring business,
through the creation of new touring shows/assets
The Group continues to grow its touring portfolio with the
creation and recent launch of BRICKLIVE Force in Germany,
BRICKLIVE Brickosaurs in Marwell Zoo, BRICKLIVE Ocean
in Edinburgh Zoo and BRICKLIVE Outer Space exhibited in a
number of cities in the UK.
We continue to invest in staff to ensure the Group has
sufficient resources to accommodate its growth strategy.
The Group has recently announced that it has adopted a
share option scheme for key employees so that staff can
share in the growth of the Group.
I would like to thank our Board, who provide invaluable
experience and advice. In 2018 we appointed two
new Non-Executive Directors, Simon Horgan and Trudy
Norris-Grey. Both have a wealth of industry experience
that complements the existing Board.
The Group has also created an Executive Board that is
responsible for the Group’s day-to-day operations and the
implementation of the Board’s strategic plans.
In addition, I must draw your attention to certain related
party transactions entered into between myself and the
Company, being the Rental Arrangements, Payments and
Further Payments (together the “Resolution Transactions”),
as detailed in note 31 to these financial statements. The
Resolution Transactions were not notified to shareholders,
and did not receive Related Party Transaction approval,
as required under Rule 13 of the AIM Rules for Companies,
at the point in time they were each entered into and,
accordingly, it is required that the Resolution Transactions
be put to shareholders to vote on at the upcoming Annual
General Meeting. I can also confirm that I have volunteered
to abstain from voting on the Resolution Transactions at
that Annual General Meeting.
I would like to thank all our production, finance, sales,
events and administrative teams for all their hard work
during 2018, which was a transformational year for
the Group.
Finally, I would personally like to thank all of our
shareholders and those who have supported me over the
last year and look forward to meeting you in person at our
Annual General Meeting on 19 July 2019, details of which
will be circulated in due course.
DAVID CICLITIRA
Chairman
13 June 2019
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LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018 Full size McLaren 720S brick model, Goodwood Festival of Speed, UK
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STRATEGIC REPORT
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STRATEGIC REPORT
ANDY SMITH
CHIEF STRATEGIC OFFICER
2018 was a transformational year in establishing the
foundations for the future success of the business.
As David set out in his Chairman’s Statement, the Group
achieved four key highlights during 2018.
For 2019, management has set five key objectives, which
will be used as a barometer to measure the Group’s success
and performance, focusing our attention on key activities to
ensure our teams remain concentrated in those areas.
We have planted our flag far and wide across the globe
and now we remain focused on delivering the following:
1. Extension of BRICKLIVE brand in Europe
In 2019, the Group has already secured multi-year
partnerships with AWC in Germany, Pal Expo in Switzerland
and Exhibition Hub in Belgium and we aim to continue this
expansion programme across Europe.
Our ability to host multiple events and shows at the same
time continues to grow as we increase the number of our
touring assets. Currently we have 12 tours being exhibited
across Europe and the US and this will continue to grow as
we continue to expand our asset base. We are also in
multiple discussions with existing and new partners for
new shows.
The Group has also taken the strategic decision to promote
and run the BRICKLIVE show at the NEC in Birmingham,
the Group’s flagship show. This will be the first year that
we will be responsible for the promotion, management and
operation of our flagship show, though we believe that,
whilst this will result in a greater initial outlay, we will
benefit from increased revenue through the receipt of all
ticket and commercial sales for the show, having previously
only received a content and licence fee.
2. Expansion of the BRICKLIVE brand in America
Obtaining a presence in the United States has been a
strategic priority for the Group and with our joint
partner, Live Nation Entertainment, Inc., we delivered
the first BRICKLIVE show in Dallas, Texas in January 2019
and have since launched BRICKLIVE Animal Paradise at
Brookfield Zoo, Chicago in May 2019.
Moving forward, together with our US joint venture partner,
we will focus on establishing our touring assets in zoos,
museums, tourist attractions and other venues, which we
believe is the perfect platform to expand our US presence
and brand given the risk profile and commercial returns.
We will also review opportunities to deliver BRICKLIVE
shows and take these forward where the risk profile
and commercial return is favourable to the Group.
3. Foster relationships with globally recognised IP
partners across the world
Our latest announcement confirms the Group has secured a
five year agreement with Nickelodeon UK for the creation of
themed tours associated with the Nickelodeon brand, such
as PAW Patrol and Nick Jr. tours with the first tour expected
to launch in summer 2019.
Historically, we have created our own tours, thanks to the
brilliantly creative minds of our design team and builders,
though our ambition has always been to achieve this with
external world class brands. We are therefore delighted
to be working with Nickelodeon UK, the number one
children’s entertainment brand in the world delivering
brick-based tours of their popular shows characters in
the UK and Ireland.
The Board believes that securing a five year agreement with
an organisation as prestigious as Nickelodeon UK is a truly
significant achievement and has the potential to be
transformational to the Group.
We will seek to continue this expansion and will look for
more partners that complement the BRICKLIVE brand in
delivering educational and entertainment experiences.
4. Commitment to the expansion and development of
the merchandise range
The Group recently announced it had appointed Licensing
Management International Limited as the Group’s agent
in respect of identifying partners for the licensing and
merchandising of BRICKLIVE branded merchandise and
products. We are focused on the expansion of our
merchandise range for the following reasons:
• It represents an important opportunity to capitalise on
a secondary revenue stream whereby we can sell
BRICKLIVE merchandise at our events and shows or in
venues which exhibit our touring assets such as zoos,
museums, tourist attractions venues and;
• The world we live in is about creating moments and
experiences that remind us ‘I was there’, such as a selfie
opportunity or purchasing merchandise. We need to
ensure we stay ahead of the market and creating and
offering merchandise as a reminder of an experience, is
key to achieving that outcome, as well as building brand
awareness more generally.
5. Expansion of the Group’s offering, through the creation
of new themed tours and shows
We provide a diverse range of themed tours that come in
many shapes and sizes and suit a variety of budgets.
Our themed tours can be shown either individually or they
can form the centrepiece of one of our shows and are
characterised as being:
• Mobile and footloose in nature;
• Flexible in size and can be adapted to meet any venue
requirements; and
• Based around fun, exiting and fresh themes and content.
Themed Tours
Our themed tours can be categorised in two ways:
• Very large themed tours that typically consist of between
50 to 80 models which are normally exhibited in
significant sized spaces such as zoos, aquariums or other
similar scale venues; or
• Small to medium sized themed tours consisting of
approximately 15 models, which can be exhibited in
a range of high footfall venues such as shopping centres,
tourist attractions and other similar sized venues.
The benefit of smaller tours is that they tend to be
exhibited indoors and are not exposed to seasonal
constraints of larger outdoor tours.
Providing tours of varying sizes is extremely important as
it increases our ability to source tours for multiple venues.
We are constantly expanding and updating our touring range
to ensure that our offerings appeal to all audiences
including clients, customers, families and fans.
Shows
For BRICKLIVE shows, the Group has entered into licence
agreements with partners which has aided the speed of our
growth as demonstrated by the multiple partnerships with
exhibitors across the world. Going forward, we will look
to expand the number of self-promoted and owned shows
in key markets through adopting partnership agreements
with venues. This provides the flexibility to showcase new
concepts and trial new activities at our shows. In 2019,
the Group announced the self-promotion of the BRICKLIVE
show at the NEC in Birmingham, the Group’s flagship show.
The Group also completed a fundraising to facilitate the
expansion of the BRICKLIVE zoo programme in February
2019. The Group has secured contracts with zoos in the UK
and had a successful launch in Brookfield Zoo, Chicago, USA
in May 2019 and anticipates continued expansion of the
BRICKLIVE Zoo touring assets.
2019 looks set to be a very exciting year. With our strategies
beginning to come to fruition, which is hugely satisfying,
we are now focused on delivering the five objectives which
are integral to the growth of the business. We would like to
thank our shareholders, partners and other stakeholders for
their support and we look forward to a prosperous 2019.
ANDY SMITH
Chief Strategic Officer
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LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
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L I V E C O M P A N Y G R O U P P L C A N N U A L R E P O R T 2018
L I V E C O M P A N Y G R O U P P L C A N N U A L R E P O R T 2018
WORLDWIDE SHOWS, TOURS & EXHIBITIONS
BRICKLIVE is a global brand that focusses on creating educational and entertainment experiences through
physical play and has been rapidly growing its presence in Europe, Asia, South and North America. In 2018,
34 shows and events were held and in 2019, 46 shows and events have already been contracted to date, with
the Company anticipating 60 shows and events to be held in 2019.
EUROPE
OVER
650
BRICK
MODELS
NORTH AMERICA
ONE OF
THE WORLD'S
LARGEST
BRICK-BASED
TOURING
SHOWS
SOUTH AMERICA
15
THEMED TOURS
BY THE END
OF 2019
12
46
SHOWS & EVENTS
ALREADY
CONTRACTED
FOR 2019
ASEAN
60
EVENTS
ESTIMATED
IN 2019
+100
MILLION
BRICKS
KEY
2017 EVENTS
SHOWS
18 EVENTS
2018 EVENTS
34 EVENTS
2019 EVENTS
60* EVENTS
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STRATEGIC FRAMEWORK
OUR ASPIRATION
OUR STRATEGY
OUR BUSINESS MODEL
TO BECOME A WORLD-CLASS
‘EDUTAINMENT’ BRAND PROVIDING
BRICKLIVE EVENTS, SHOWS AND
TOURS ACROSS THE WORLD,
FOSTERING AN EDUCATION AND
ENTERTAINMENT EXPERIENCES
THROUGH INTERACTIVE PHYSICAL
PLAY AND TO BECOME ONE OF THE
WORLD’S LARGEST PRODUCERS OF
INTERLOCKING BRICK MODELS AND
PROVIDE MEMORABLE EXPERIENCES.
In order to deliver the Group’s aspiration, the Board
remains focused on BRICKLIVE’s brand principles, which
are based on the foundations of creating an educational
and fun experience through physical play for children.
We are creating a brand where customers want to
repeatedly visit our incredible events and tours.
BRICKLIVE’s values are:
• Providing educational and fun experiences through
physical play;
• Encourage interactive physical play that fosters
creativity and innovation;
• Provide an inclusive, collaborative and engaging
environment;
• Memorable fun experiences for families and fans; and
• Delivers an entertaining and memorable experience.
We will continuously review all BRICKLIVE experiences
and activities to ensure they embody our brand value.
We will continuously enhance our show format and
content, introducing new interactive features that create
memorable experiences that appeal to families and our
global audience.
See page 16
Delivering BRICKLIVE ‘edutainment’ experiences
that are memorable for our customers and partners,
is integral to underpinning the performance of the
Group. We will work with customers and partners to
produce incredible bespoke models. We will continue
to work with global partners and establish multi-year
partnerships that will support the strategic growth
of the Group and deliver value for our shareholders.
We will do this through the following core activities
which are:
• Content producer of brick-based models and statues;
• Promoting BRICKLIVE events;
• Content provider for BRICKLIVE shows and
exhibitions;
• Content provider of BRICKLIVE touring assets; and
• Producer of bespoke corporate commissions.
See page 20
BRICKLIVE, Basel, Switzerland, April 2018
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LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
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BUSINESS OVERVIEW
Live Company Group plc is a live events and entertainment group. The Company was admitted to trading on AIM
in December 2017, following the reverse acquisition of Brick Live Group and Parallel Live Group by Live Company
Group plc (previously Parallel Media Group plc).
The Group owns the BRICKLIVE brand which is a content provider for brick-based events around the world. LEGO®
is a trademark of the LEGO Group of companies and the BRICKLIVE Group is not associated with the LEGO Group
of companies. BRICKLIVE is an independent producer of BRICKLIVE events.
Principal Activities
The principal activities during the year ended 31 December 2018 related to providing content for BRICKLIVE
shows and events taking place in the UK, South Korea, China, Italy, Japan, Thailand, Argentina, Indonesia, Monaco
and Switzerland. The Group hosted 34 shows and events in 2018 (2017:18 shows and events), representing almost
a 100% increase from the previous year and is seeking to increase its global footprint with a target of 60 shows
and events in 2019.
The Group’s strategic aim is to build a global children’s education and entertainment brand focused on creating
environments that encourage interactive play, foster creativity, collaboration and physical experiences in an
inclusive and safe environment. The BRICKLIVE brand is about creating memorable and enjoyable ‘live’
experiences through physical play.
BRICKLIVE comprises a network of global partners to deliver shows and events around the world including
Europe, North America, South America and Asia. The Group has registered the BRICKLIVE brand in multiple
jurisdictions and owns the intellectual property rights of sophisticated software used in the detailed design
and engineering of models.
In October 2018, the Group completed the acquisition of Bright Bricks, one of the world’s premier model building
companies. Having built models for Jaguar Land Rover, Rolls Royce, Force India (Formula 1), McLaren, Chiquita
and Footlocker, it has also accomplished an impressive seven Guinness World records for its models. Bright Bricks
has now been successfully integrated into the Group and is the production hub producing brick-based models for
the Group’s events, shows and tours. The acquisition of Bright Bricks has resulted in an expansion of the Group’s
Intellectual Property and capabilities, enhanced speed to market, increased competitive advantage, security over
supply of bricks and increased barriers to entry.
BRICKLIVE
LITE
BRICKLIVE
CAFES
BRICKLIVE
KIDS
BRICKLIVE
SHOWS
BRICKLIVE
BRAND
BRICKLIVE
EDUCATION
BRIGHT
BRICKS
BRICKLIVE
CENTRE
THEMED
TOURS
■ Zoos, Aquariums &
Horticultural Societies
■ Town and City Centers
■ Business Improvement Districts
■ Museums
■ Tourist Attractions
BRICKLIVE, Dallas, USA, January 2019
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BRICKLIVE, Dallas, USA, January 2019
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LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
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L I V E C O M P A N Y G R O U P P L C A N N U A L R E P O R T 2018
BRICKLIVE BRAND
BRICKLIVE is the principal brand of the Group. This name was originally associated solely with events based in
large arenas or exhibition spaces in the UK, notably the ExCel in London and the NEC in Birmingham. The Group
has complemented this large format with a pop-up concept that is able to occupy smaller spaces with the growth
of smaller themed Touring shows. Over the last 18 months, the BRICKLIVE brand extensions have grown from the
original BRICKLIVE shows format and these include:
TM
TM
BRICKLIVE Touring
A new division created in April 2018 to deliver concepts and content
for themed touring events across the globe includes zoos, museums,
city centres, business improvement districts and other tourist
attractions around the world.
TM
TM
BRICKLIVE Kids Cafés
These are branded BRICKLIVE cafes, featuring a range of play
activities including a brick pit, graffiti wall and race tracks as well
as family dining and have been launched in South Korea.
BRICKLIVE Centres
Permanent hotel or shopping mall-based fixtures of a play zone of
around 100 sqm and launched in South Korea and China.
BRICKLIVE Kids
These are smaller versions of BRICKLIVE Centres, which include
permanent childcare creches, offering professionally supervised play
areas for children in shopping centres, while parents go shopping.
EDUCATION TM
EDUCATION
BRICKLIVE Education
This is a wholly-owned subsidiary of LVCG that has entered an
agreement with ImmersiveMinds to develop and enhance educational
content for BRICKLIVE shows globally.
BRICKLIVE Lite
The Lite format covers 400 to 1,000 square metres in venues such as
shopping malls and hotels for up to 10 days, launched in South Korea.
BRAND VALUES
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BRICKLIVE Animal Paradise, Grimaldi Forum, Monaco, December 2018
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BUSINESS MODEL
1) Worldwide Shows, Tours & Exhibitions
BRICKLIVE is seeking to become a global brand that is focused on creating educational entertainment
experiences through physical play. The Group has rapidly established a presence in Europe, Asia, South and
North America and in 2018, 34 BRICKLIVE shows/events were held and in 2019, 46 shows/events have already
been contracted to date. The Board is anticipating that there will be approximately 60 shows/events in 2019.
The Group plans to continue investment in the BRICKLIVE touring products to drive long term sustainable growth.
The Group is working with partners, exhibition promoters, venues, destination and tourist attractions globally to
facilitate this growth strategy.
BRICKLIVE Events/Shows
70
60
50
40
30
20
10
0
AMERICA
Live Nation
40
35
20
14
8
8
10
8
60
46
34
18
ASIA
NORTH AMERICA
Imagine Exhibitions
EUROPE
2017
1
1
3
3
3
1
0
3
NORTH AMERICA
SOUTH AMERICA
TOTAL
2018
As at May 2019
EUROPE
Pal Expo
2019 (projected)
ASEAN
Bec Tero
2) Expansion of BRICKLIVE Assets
Touring
The acquisition of Bright Bricks resulted in the Group’s portfolio of assets increasing significantly from one
tour prior to acquisition, namely Animal Paradise to nine tours post acquisition, with the addition of eight tours
including an additional Animal Paradise, Big Cats, Fantasy Kingdom, Metropolis, Britannia, Safari, Mythical Beasts
and Brickosaurs. These tours are exhibited in zoos, aquariums and horticultural societies, town and city centres,
Business Improvement Districts (BIDS), museums, tourist attractions and shopping centres.
The Group has continued to expand the number of its touring assets, with BRICKLIVE Zoo programme and the
addition of new tours including BRICKLIVE Force, BRICKLIVE Ocean and BRICKLIVE Outer Space. The Board
believes that the number of touring assets will increase to 15 by the end of 2019 and to 20 by the end of 2020,
further expanding the Group’s ability to host multiple shows and events across numerous locations and
geographies at the same time.
Themed Touring Assets
s
r
u
o
T
f
o
r
e
b
m
u
N
25
20
15
10
5
0
9
1
20
15
12
Before Bright Bricks
Acquisition
After Bright Bricks
Acquisition
End of Q2 2019
End of 2019
(projected)
End of 2020
(projected)
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The network of partners for BRICKLIVE shows includes:
As at May 2019
SOUTH AMERICA
Eximent
EUROPE
Grimaldi Forum
EUROPE
Exhibition Hub
EUROPE
AWC Germany
JAPAN
Make Merry
BRICKLIVE TOUR LOGOS
TM
TM
TM
TM
TM
TM
TM
TM
TM
TM
TM
TM
AMERICA
Parallel Three Six Zero
SOUTH KOREA
Hi-Brick
CHINA
Bricklive Centre
Education Technology
(Beijing) Co., Ltd
20
21
LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
0
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Bricks and Models
Including the assets acquired as part of the Bright Bricks acquisition, the total value of the Group’s models and
brick stock as at 31 December 2018 amounted to £9,904,000 (2017: £798,000).
This growth in the Group’s fixed assets is significant, and it has enabled us to significantly expand the range of
our assets for our shows, events and tours, which continues to attract new partners and customers. The continued
investments in growing the number of models we have also enables us to host multiple shows and events at any
one time, thereby continuing to grow our revenue potential.
Number of Bricks
As at
March 2019
Before Bright
Bricks Acquisition
32,000,000
112,000,000
3) Opportunity to work with Partners
The Group is increasing its scale and global reach, improving opportunities to establish worldwide networks with
partners in Europe, Asia and North and South America including global IP partnerships, where there are clear
synergies with the edutainment industry. More recently, the Group has secured multi-year partnerships with
AWC in Germany, Pal Expo in Switzerland and Exhibition Hub in Belgium. The Group is actively progressing
new opportunities and potential partnerships for its touring assets.
Our latest announcement confirms the Group has secured a five year agreement with Nickelodeon UK for the
creation of themed tours in the UK and Ireland associated with the Nickelodeon brand, including Nick Jr.
The first themed tour will be based on PAW Patrol, one of Nick Jr.’s most watched television shows in
Europe and America by young children, with the tour expected to feature a collection of
15 models of the show’s most popular characters including Ryder, Chase, Marshall and
Sky and is expected to launch in summer 2019. The partnership is a significant milestone
for the Group and we look forward to working with Nickelodeon UK to develop new tours
for other popular Nickelodeon Children’s TV shows.
The Group will continue to seek new opportunities to work with partners to deliver the
BRICKLIVE brand.
40,000,000
80,000,000
120,000,000
4) Develop revenue streams
Number of Models
As at
March 2019
Before Bright
Bricks Acquisition
70
Content Assets & Stock
650
100
200
300
400
500
600
700
2018
£9,904,000
2017
£798,000
£0
£2,000,000
£4,000,000
£6,000,000
£8,000,000
£10,000,000
For BRICKLIVE shows and events, historically the Group received revenue from content rental and licence fees.
However, in April 2019 the Board was excited to announce that the Group will be promoting and running the
Group’s flagship BRICKLIVE show at the NEC in Birmingham. This will be the first year the Group will be
responsible for the promotion, management and operation of the NEC Show and the Board believes that,
whilst this will result in a greater outlay for the Group in hosting the NEC Show, the Group expects to benefit
from increased revenue through the receipt of all ticket and commercial sales for the NEC Show, having
previously only received a content and licence fee.
The Group is also seeking, where appropriate, to move more towards a partnership-based approach to its events,
similar to its model for the Monaco shows, whereby the Group provides the content with the exhibitor providing
the venue, with the events profits after costs being shared equally as opposed to the Group receiving just a
content and licence fee.
The Group will continue to produce touring models which appeal to families and customers. The hugely
successful Brickosaurs tour is currently leased to venues until the end of 2020 and there are several other
popular tours such as Safari and Fantasy Kingdom which are also leased into 2020. Being able to create
and produce popular touring assets of varying sizes that are adaptable to venues is key to underpinning
the organic growth and performance of our business, providing sustainable and predictable income.
We continually seek new opportunities to increase and diversify our revenue streams. This includes creating
bespoke corporate commissions, which are an excellent marketing tool to launch new products, enhance
corporate events and engage customers and new audiences. In addition to this, the Group sells consumer
kits at BRICKLIVE events and will works with partners and venues such as zoos where these can be purchased,
further developing the revenue opportunities for the business. The Group is also working with Licensing
Management International Limited to identify partners for the licensing and merchandising of BRICKLIVE
branded merchandise and products to be sold at the Group’s BRICKLIVE shows, tours and events, further
developing our revenue streams.
22
23
LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
L I V E C O M P A N Y G R O U P P L C A N N U A L R E P O R T 2018
World’s
Largest
LEGO
Ship
World’s
Longest
Span LEGO
Bridge
World’s
Largest
LEGO
Woolly
Mammoth
World’s
Largest
LEGO
Caravan
World’s
Largest
LEGO Model
Land Rover
Tower Bridge
World’s
Largest
LEGO
Moa
World’s
Tallest LEGO
Christmas
Tree
Land Rover Discovery Tower Bridge Build
(World's Largest LEGO model)
Motorhome & Caravan Show, 2015
(World's Largest LEGO® Caravan)
ICE Bridge Hong Kong
(World's Longest LEGO® Span bridge)
Queen Mary Ship
(World's Largest LEGO® Ship)
24
World's Largest LEGO Wolly Mammoth, BRICKLIVE, Basel, Switzerland, April 2018
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FINANCIAL REVIEW
Following the creation of the Live Company Group at the end of 2017, 2018 was another year of significant
transformation for the Group, with the:
• Successful fundraises in January, April and October 2018 to accelerate the Group’s growth and;
• Acquisition, and subsequent integration, of Bright Bricks for £8.5 million in October 2018.
I would like to take this opportunity to thank all the members of my finance team, without whom this would have
not been possible.
An an overview of the financial results for the year ended 31 December 2018 is set out below.
Revenue
Revenues from continued and discontinued activities increased 178% in 2018 from £1,928,000 in 2017 to
£5,351,000 in 2018. The major driver of this growth can be attributed to the expansion of the Group’s activities,
with 34 shows and events held in 2018 compared to 18 in 2017, as well as the sale of products and models to our
partners.
As a result, the Group grew revenues in each of its target geographical areas during 2018.
£3,500K
£3,000K
£2,500K
£2,000K
£1,500K
£1,000K
£500K
£0K
634
637
1,064
440
UK
EUROPE
3,112
854
431
0
USA
2017
2018
107
0
SOUTH AMERICA
ASIA
Revenue
The Group has grown revenues in each geographical location as follows:
Year
2018
2017
Geographic Location (£)
Total Revenue
£5,351,000
£1,928,000
UK
Europe
USA
South America
Asia
Total
2018
637,000
1,064,000
431,000
107,000
3,112,000
5,351,000
2017
% increase
634,000
440,000
-
-
854,000
1,928,000
0.5%
142%
-
-
264%
178%
2017
2018
26
As set out in the Group’s interims, following the Group’s New York show in February 2018, the Group made the
decision to launch the BRICKLIVE brand across the US and to discontinue the LEGO® LIVE brand. Despite the
New York show receiving positive reviews and generating revenues of £431,000, it suffered a loss of £500,000
and in accordance with IFRS 5, the show has been classified as a discontinued activity as the Group is no longer
operating LEGO® LIVE events. The Group continues to be active in the US and Canada, through Parallel Live
and its joint venture with Live Nation Entertainment, Inc., and held its first US BRICKLIVE show earlier this
year in Dallas.
On 30 November 2018, the Company announced an agreement with AWC Asia (an agent for AWC AG) to lease
Mythical Beasts for three years, commencing end of January 2019. The commencement of this lease and the
associated revenues has been mutually delayed until August 2019 as Mythical Beasts is currently being exhibited
at the Odysseum in Germany, an AWC AG venue, until the end of June 2019 before being shipped to South Korea
to be exhibited from the end of August 2019. Discussions are ongoing with AWC Asia in respect of this matter
and it is currently being proposed that after a year, Mythical Beasts will be replaced by one of the Group’s other
popular touring assets, with the Group anticipating to now receive $300,000 on a rolling annual basis for the
touring assets, as opposed to $1.3 million up front for the three year lease.
EBITDA
Excluding the loss from the newly acquired Bright Bricks entity, 2018 EBITDA from continuing activities amounted
to £333,000 (2017: £273,000 loss).
On completion of the acquisition of Bright Bricks in October 2018, Bright Bricks became the production hub for the
Group BRICKLIVE operations. As a result, following completion, all sales were accounted through BRICKLIVE and
in the period from completion of the acquisition to 31 December 2018, Bright Bricks recorded an operating loss of
£809,000. The Group is pleased to report the integration has been completed successfully.
A reconciliation to total losses for the year is set out below:
For the year ended 31 December (£)
EBITDA excluding Bright Bricks Q4
Bright Bricks Q4 loss
Depreciation and interest charges
Loss from discontinued LEGO® LIVE show
Exceptional items (Note 7)
Total losses for Group
2018
333,000
(809,000)
(295,000)
(500,000)
(1,339,000)
(2,610,000)
2017
(273,000)
-
(130,000)
-
(5,037,000)
(5,440,000)
EBITDA is also after ongoing Plc headquarter corporate costs for the year amounting to £999,000
(2017: £1,025,000).
Exceptional items
Exceptional items of £1,339,000 relate predominately to transactional costs of, in aggregate, £1,033,000 in 2018
in connection with the strategic acquisition of Bright Bricks and the various fundraises completed during the year.
Further details on the exceptional items is set out in Note 7 to the consolidated financial statements.
Loss per share
The loss per share from continuing activities improved to 3.8p (2017: loss 11.3p) as set out in Note 13 to the
consolidated financial statements.
Cash flows
The consolidated Statement of Cash Flows is set out on page 57 to these consolidated financial statements.
During 2018 the Group raised a total of £4,950,000 (before expenses) through equity fundraises and secured
a loan of £1,000,000 with Riverfort Global Capital Limited (“Riverfort”), which was subsequently drawn in full
during Q4 2018. The Group paid cash of £2,167,000 to acquire Bright Bricks with the £833,000 deferred
consideration due in October 2019. The deferred condiseration will be settled in cash or new Ordinary
Shares at the vendors discretion.
The remaining funds raised were used to invest in BRICKLIVE Animal Paradise and the creation of other statues
and models, and for working capital purposes. Since the year end the Group has raised further funding for the
expansion of its BRICKLIVE Zoo programme and to provide general working capital.
27
LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
L I V E C O M P A N Y G R O U P P L C A N N U A L R E P O R T 2018
TM
Statements of Financial Position
The consolidated Statement of Financial Position as at 31 December 2018 is set out on page 55 to these
consolidated financial statements with the Group’s total net assets having increased to £10,627,000
(2017: £2,844,000). The increase in the Group’s assets relates predominately to the consolidation of Bright Bricks
for the first time following completion of its acquisition in October 2018. Its total assets includes content assets,
being its models, and its brick stock which as at 31 December 2018, in aggregate, amounted to £9,904,000 (2017:
£798,000).
Successful trademark applications continue to grow and the costs in connection with acquiring these
trademarks amounted to £55,000. The investment in trademarks continues to increase in 2019.
The Company’s own Statement of Financial Position recognises the aggregate investments in Bright Bricks
(£8,500,000), Brick Live Group (£5,000,000), Parallel Live Group (£1,000,000) and the consideration for the
61.1% of Brick Live Far East (“BLFE”) acquired by the Company (£2,950,000). The Directors carried out a formal
impairment review of goodwill in the consolidated financial statements and investments in the parent company
financial statements and have deemed that no impairment is required at 31 December 2018.
In October 2018, the Company announced it adopted a share option scheme, pursuant to which it would issue
up to 6,709,459 options. On 2 April 2019, the Company granted 3,086,346 options to certain Directors and senior
management, further information on which is set out in Note 34 to the consolidated financial statements.
Summary
2018 was a year of significant transformation and growth for the Group and we are continuing to invest in our
touring models and assets as we build for growth. This momentum has continued into 2019 and we have made
a strong start to the year, with revenue of £4.0 million already booked.
BRYAN LAWRIE
Chief Financial Officer
13 June 2019
BRICKLIVE BIG CATS MODELS
28
BRICKLIVE , Basel, Switzerland, April 2018
02
CORPORATE GOVERNANCE
30
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BOARD OF DIRECTORS
DAVID CICLITIRA
Executive Chairman
During his 35 year career, through his innovative vision, drive and creativity, David Ciclitira has played a significant
role in shaping today’s satellite broadcasting and sponsorship landscape. David read law at Kings College London
and was called to the Bar (Barrister) as a Blackstone Exhibitor before joining the merchant bank Guinness,
Mahon & Co.
He was one of the four original shareholders of Europe’s first satellite television station, Satellite Television plc
(“SATV”), which was renamed SKY following the sale in 1983 of 65% of SATV to Rupert Murdoch’s News
Corporation. David remained with Sky as Deputy Managing Director until the end of 1986 when he left to
found the original Parallel Media Group (“PMG”).
In 1987, David founded PMG and in 1998, under David’s guidance, PMG entered into a joint venture with NBC for
the formation of CNBC Sports International Limited, the international sports broadcasting arm of NBC which was
broadcast on its CNBC Europe and CNBC Asia platforms. PMG successfully sold its shareholding in CNBC Sports
to NBC in 2004.
David is established as one of the major forces in, and respected member of, the global sports marketing industry.
Through his strong personal relationships with the commissioners of various sporting federations, proven
marketing skills with sponsors and wide-ranging contacts within the broadcasting world. David has
revolutionised the sports marketing strategies of some of the world’s leading Federations - taking European Tour
golf out of Europe and into South Africa and then Asia (including introducing the first professional golf
tournament to China at Mission Hills), re-launching the World Cup of Golf and bringing the event under the wing
of the Five Tours, representing the World Nordic Ski Championship on behalf of the FIS, overseeing the
sponsorship and broadcast strategies of the Davis Cup, raising sponsorship for the first ever Jordan Formula One
team with 7Up, representing the commercial rights of the Ladies European Golf Tour, instigating the
commercialisation of the English and Italian Rugby Unions, and creating the Tour of China cycling race.
David has also overseen the marketing strategies for some of the world’s leading brands including managing
Pepsi’s UK music sponsorship strategy for several years, representing Heineken as its global sponsorship agency
(creating the pan-European Buckler Basketball Challenge and overseeing their activities in golf, as well as
overseeing their sponsorship of the Whitbread Round the World Yacht Race), acting as Omega’s sponsorship
agency of note, negotiating UBS’s title sponsorship of the Hong Kong Open, creating a sports tourism strategy
for South Africa at the end of apartheid and launching the Ballantines Championship in Korea for Pernod Ricard.
These are to name but a few of the sponsors with whom David has worked.
David’s reputation as a leading marketer and dynamic entrepreneur in the Asian marketplace led to the
establishment of a joint venture with Live Nation to form Live Nation Marketing Partnership Asia Limited
(“LNMPA”). In only two years since its inception, under David’s guidance, LNMPA raised many USD millions in
funding for a new annual Electronic Daisy Carnival festival in Tokyo.
In May 2016, David invested in Brick Live Group and became its Chairman and its majority shareholder. BRICKLIVE
‘Built for LEGO Fans’ is an interactive LEGO-based fan event that is currently staged in over 20 cities worldwide. In
December 2017, David reversed Brick Live Group and its sister company Parallel Live Group (the organiser of US
LEGO-based shows) into Live Company Group plc (LVCG), which is admitted to trading on the AIM market of the
London Stock Exchange. David is the current largest shareholder and Executive Chairman of LVCG.
ANDREW SMITH
Chief Strategic Officer
BRYAN LAWRIE
Chief Financial Officer
RANJIT MURUGASON
Non Executive Director
Andy joined Brick Live as Managing
Director with effect from 1 November
2017 and became an Executive Director
of the Company on 27 December 2017.
Andrew was previously Director of Events
at Multiplay (UK) Limited (“Multiplay”),
the gaming services company specialising
in online hosting, events management
and esports, which is part of Game Digital
plc. Prior to joining Multiplay, Andy spent
8 years with the FTSE100 listed Compass
Group PLC, with considerable experience
in events and commercial operations.
Andy is now Executive Chairman of Bright
Bricks and Chief Strategic Officer on the
Board of Live Company Group Plc.
Bryan started his career in the London
office of PKF, heading up the Business
Support service team. This followed with
a period of providing CFO services on a
portfolio basis and then founding CFO
Partners in early 2015. Bryan is an
experienced interim CFO, working
with CEO’s and other Board directors
advising on both business and financial
strategic matters.
Ranjit joined the Board of PMG in 2010.
Ranjit has over 20 years’ experience in
strategic advisory, corporate finance and
investment banking and capital markets
in Europe, Asia, the Middle East and the
USA. He is the founder and Managing
Director of Urban Strategic, established
in London in 2003 and currently
headquartered in Singapore. Previously
Ranjit served as a Managing Director of
the investment banking division of ABN
Amro and was a senior advisor to GMR
Group, one of India’s largest multinational
infrastructure businesses.
SIMON HORGAN
Non Executive Director
TRUDY NORRIS-GREY
Non Executive Director
SERENELLA CICLITIRA
Non Executive Director
Following the acquisition of Bright Bricks
Simon Horgan has joined the Board of
LVCG. He brings a wealth of experience
across several industry sectors but most
relevant to the future expansion of the
business is his knowledge and track
record in international exhibition and
conference venue management
plus event and exhibition portfolio
management and development. Simon
has been involved in the events and
exhibitions sector for over 30 years.
For six years he was the CEO of the
Abu Dhabi National Exhibition Centre
(ADNEC) and was instrumental in
the acquisition of London’s flagship
exhibition venue, ExCel for the ADNEC
in a £318 million deal for the Abu Dhabi
government. Prior to joining ADNEC
Simon was the COO for the National
Exhibition Centre in Birmingham.
Trudy Norris-Grey is a recognised
leader in the IT industry, with over 30
years of success spanning global sales,
marketing, channel and partner
strategies, business development,
and portfolio transformation. As AXA’s
next deputy CEOfor its enterprise and
global partnerships business, Trudy
is focused on digital transformation -
including creating, incubating and
accelerating new markets and new
business models for AXA in service of
its customers as their needs evolve and
change. Trudy has also held leadership
positions at Microsoft, Oracle, Sun
Microsystems, and BT.
Serenella (also known as Maria
Serena Papi) has an Honours Degree in
Art History from Trinity College, Dublin
and since 2003 has been an Honorary
Fellow at the Royal College of Art,
London. She has worked extensively with
art galleries and artists around the world.
Between 1992 and 2000 Serenella was
Group Managing Director of the pan-
European satellite broadcaster Super
Channel (which later became NBC
Europe) from 1998-2016 she was
Managing Director of PMG which
specialised in sport and music, during
this period Serenella was also a Director
of CNBC Sport. In 2017 Serenella joined
the Board of Live Company Group Plc.
Serenella Ciclitira is David Ciclitira’s
long term partner.
32
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LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
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THE EXECUTIVE BOARD
The Executive Board was created in Q1 2019 and is chaired by the David Ciclitira, the Group’s Executive Chairman.
The Executive Board is responsible for the day-to-day operations and the development of strategic plans which
are considered by the Board. The Executive Board has appointed Simon Horgan and Andy Smith as its Deputy
Chairmen. The Executive Board contains additional expertise in production, operations, design services as well
global event planning events and meets every 4 to 6 weeks. The Executive Board consists of the following:
DAVID CICLITIRA (1)
Executive Chairman
Live Company Group
SIMON HORGAN (Deputy Chair) (2)
Non-Executive Director
Live Company Group
ANDREW SMITH (3)
Executive Chairman
Bright Bricks
BRYAN LAWRIE (4)
Chief Financial Officer
Live Company Group
JON GAYTON
Chief Operating Officer
Bricklive Group
RUTH CUNNINGHAM
Chief Operating Officer
Live Company Group
DUNCAN TITMARSH
Managing Director
Bright Bricks
ED DIMENT
Creative Director
Bright Bricks
SARAH WHITTAKER
Chief Marketing Officer
Live Company Group
Notes:
(1) Executive Chairman on the Board of Live Company Group plc
(2) Non-executive Director on the Board of Live Company Group plc
(3) Chief Strategic Officer on the Board of Live Company Group plc
(4) Chief Financial Officer on the Board of Live Company Group plc
Principal Risks and Uncertainties
Market risk
Global markets are subject to a broad range of political, economic, legal, financial and other risks many of which
are unpredictable. Having BRICKLIVE events and shows in various continents simultaneously helps to mitigate
these risks.
Competition is always a risk to growing businesses. The strategic acquisition of Bright Bricks provides security
of supply of bricks and with the trademarks acquired for the BRICKLIVE brand in territories across the world,
provides a competitive edge and increases the barriers to entry.
Operational risk
The Group focuses on building specialist models and providing content for shows and events around the world,
each BRICKLIVE show and event has to reflect the BRICKLIVE brand values. This presents many operational
opportunities and each show is monitored closely and attended by our staff.
All models are carefully designed, from concept to completion using sophisticated engineering software to design
the models and we work with our clients and partners prior to installation of the models to ensure the models can
be enjoyed in a safe and secure environment.
Extensive time is invested in the logistical operations of events, shows and tours to ensure the time spent
transporting the models to venues is minimised and rental period is optimised.
Financial risk
Given the operational risks in the growth of the business, the Group focuses on keeping a strong balance sheet
underpinned by the number of models and bricks. Securing forward sales and multi-year contracts provides the
Group with significant confidence of the medium-term growth strategy.
The time taken between developing a new concept, building the models and realising revenue can place a strain
on any organisation. The Group mitigates this risk by maximising the utilisation of its touring asset during the
calendar year as well as seeking to diversify its revenue streams. This ensures the business is well placed with the
financial flexibility to invest in new tours as the opportunity arises.
Early Stage of Operations
Despite the significant growth in revenues during 2018 and having only traded as an enlarged group for
16 months in its current form, the Group is still in its early stage of development.
There are several additional operational, strategic and financial risks associated with early stage companies. In
particular, the enlarged Group’s future growth and prospects will depend on its ability to stay competitive with its
pricing, maintain and develop its business and to manage growth and to continue to improve operational, financial
and management information and quality control systems on a timely basis, whilst at the same time maintaining
effective cost controls. Although the Group is continuing to invest heavily in the development of its content and
the pipeline is showing good growth, the development of the enlarged Group’s revenues is difficult to predict.
Management of growth
The ability of the enlarged Group to implement its strategy requires effective planning and management control
systems. The Group’s growth plans may place a significant strain on its management and operational, financial
and personnel resources. The Group’s growth strategy will need to be managed accordingly.
Exposure to Asia
The Directors consider that a reasonable amount of the Group’s revenues will be generated in Asia and, in
particular, in China. Investments in Asia involve a broad range of political, economic, legal, financial and other risks,
many of which are unquantifiable and/or unpredictable and not necessarily associated with the risks involved in
activities in more developed and regulated environments.
34
35
LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
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Relationship with LEGO®
There is no formal signed agreement with the LEGO® Group of companies in relation to the staging of BRICKLIVE
events internationally. LEGO® is a trademark of the LEGO Group of companies. The Group is not associated with
the LEGO® Group of companies and is an independent producer of BRICKLIVE events.
Retention of business
A proportion of Group’s revenues are derived from licensee partners. The Group’s sales and marketing efforts
have expanded and diversified the customer base but the number of license partners is still small therefore
relationships will need to be managed effectively.
Management of intellectual property
The ability to protect the Group’s intellectual property is of significance. The Group has registered the BRICKLIVE
brand in multiple jurisdictions and owns the intellectual property rights of the software that is used in the
engineering its models. Operating without infringing the proprietary rights of third parties is an important
aspect of the Group’s competitive advantage.
Retention of key executives and staff
The Group’s development and prospects are dependent upon the continued services and performance of its
Directors, senior management and other key personnel. The Board has introduced a long-term share option
scheme to motivate, reward and retain management within the business.
Key Performance Indicators (“KPIs”)
The primary objectives of the Group in 2018 were to secure the production of content, increase its global presence
and increase revenue. The principal internal KPIs revolved around the core objectives:
• Revenue growth;
• Number of models created;
• Number of shows and partners globally and;
• Asset utilisation
The first three above are currently being tracked and the asset utilisation metric is in the process of being
implemented.
Forward Looking Statement
As discussed in the Chairman’s Statement, the Group is focused on continuing to expand the global footprint of its
BRICKLIVE events and touring assets internationally and increase recurring revenue.
Particular geographic locations of interest are Europe, America, Asia and the Middle East. The Directors are
investing significant time and resources into developing new business in these regions as they have been identified
as markets which can deliver growth for the Group.
Role of the Board
The Board’s role is to agree the Group’s long-term strategy and monitor achievement of its objectives. The Board
aims to meet four to six times a year and hold additional meetings as and when necessary. A full Board pack is
prepared and circulated to Board members in advance of each Board meeting.
Shareholders
The Board seeks to protect shareholders’ interests by following where appropriate the guidelines in the
QCA Corporate Governance Code. The annual general meeting provides the Board with an opportunity to
informally meet and communicate with investors.
CORPORATE GOVERNANCE
The Board is fully committed to investing in the management systems and appropriate controls to ensure that the
Group’s high standard of corporate governance is reflective of the quality of its operations and service.
The Directors recognise the importance of sound corporate governance commensurate with the size and nature of
the Company and the interests of its shareholders. The Corporate Governance Code does not apply to companies
admitted to trading on AIM and there is no formal alternative for AIM companies.
The Quoted Companies Alliance has published a corporate governance code for small and mid-sized quoted
companies, which includes a standard of minimum best practice for AIM companies, and recommendations for
reporting corporate governance matters (the “QCA Code”). The Directors comply with the QCA Code to the extent
they consider it appropriate and having regard to the size and resources of the Company.
Corporate Governance Report
The Directors recognise the importance of good corporate governance and have chosen to apply the Quoted
Companies Alliance Corporate Governance Code (the QCA Code”). The QCA Code was developed by the QCA
in consultation with a number of significant institutional small company investors, as an alternative corporate
governance code applicable to AIM companies. The correct application of the QCA Code requires us to apply the
principles set out in the QCA Code and also to publish certain related disclosures; these may appear in our Annual
Report, be included on our website or we can adopt a combination of the two approaches. Recommended
locations for each disclosure are specified in the QCA Code and we intend to follow these from the publication
of the Company’s Annual Report and Accounts for the year ended 31 December 2018.
The corporate governance framework which the Group operates is based upon practices which the Board
considers appropriate for the size, risks and operations of the business.
Principle One: Business Model and Strategy
The purpose of the Group is to create and provide content for BRICKLIVE shows, events and exhibitions. The Group
has licensee partners and venue operators to promote and operate BRICKLIVE shows, events and exhibitions
globally. The Group provides both content and technical support to partners for a license and content fee.
The Group has partners throughout the world including China, Japan, South Korea, Asia, South America, Europe
and the United States and is constantly seeking to expand its global network of partners.
The key to the Company’s success is to establish strong relationships with reliable licensee partners who have a
track record of staging events, and to supply the best quality content to our licensee partners.
Principle Two: Understanding Shareholder Needs and Expectations
The Board is committed to communicating effectively with its shareholders.
The Board is committed to maintaining good communication and having constructive dialogue with its
shareholders on a regular basis. Institutional shareholders and analysts have the opportunity to discuss issues
and provide feedback at meetings with the Group.
In addition, all shareholders are encouraged to attend the Company’s Annual General Meeting and any other
General Meetings that are held throughout the year. Investors also have access to current information on the
Company though its website, www.livecompanygroup.com.
Principle Three: Stakeholder Responsibilities
The Board recognises the long-term success of the Group is reliant upon the efforts of the employees,
contractors, suppliers and regulators. The Board has put in place a range of processes and systems to
ensure the Board has oversight and contact with key management.
Employees: Good communication is essential and the management team holds weekly calls to discuss material
matters affecting the operations of the business.
Suppliers: the Group engages a number of freelancers to support the team of permanent staff, enabling the
business to scale up or down the level of support required at any time. Freelancers are considered an important
resource of the business.
36
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LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
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L I V E C O M P A N Y G R O U P P L C A N N U A L R E P O R T 2018
Licensee partners: the Group has strong relationships with each of its licensee partners, meeting regularly and
working closely to ensure they are provided with the necessary levels of support. Representatives of the Group
regularly attend the events and where possible, suggest and provide improvements and enhancements to the
events.
Shareholders: the Group communicates regularly with its shareholders, providing information updates using
regulatory and non-regulatory news releases, the monthly Group Newsletter, keeping the investor section of the
website up to date, and posting regular news updates from shows on the Company’s social media channels.
Principle Four: Risk Management
The Group has an established Audit Committee, chaired by Ranjit Murugason. The Audit Committee has
responsibility for ensuring the effectiveness of risk management and internal controls on behalf of the Board.
During the annual audit process, specific risks are identified and evaluated in detail.
A whistle blowing policy is in place to enable employees to report to the Board, in confidence, any risks or threats
to the operations of the business.
The principal risks of the business are set out in the Admission Document published in November 2017,
a copy of which is available on the Company’s website. The Audit Committee reviews and assesses these
risks on an annual basis.
Principle Seven: Evaluation of Board Performance
The Board intends to carry out an annual evaluation of its performance and effectiveness. The Company was
re-admitted to AIM trading in December 2017.
Following Simon Bennett (Independent Non-Executive Director) stepping down from the Board in August 2018,
the Company is seeking to appoint an additional Independent Non-Executive Director with relevant plc experience.
As a result, it is anticipated that the Group’s first Board evaluation will take place following such appointment, and
annual evaluations will be conducted thereafter.
Principle Eight: Corporate Culture
The Group recognises its responsibility to be socially responsible and (where possible) contribute to social value,
community development, local employment, apprenticeships and training schemes. The Group endeavours to
follow sustainable and responsible management practices in protecting the long-term interests of the business,
its employees and community stakeholders.
Ethics and human rights: the Group aims to conduct its business with honesty and integrity, respecting human
rights and the interests of its employees, partners and third parties. The Group advocates high ethical standards
in carrying out its business activities and has policies for dealing with gifts, bribery, corruption, whistleblowing and
inside information. The Group does not make political donations, and any charitable donations are made where
legal and ethical according to local law and practices.
Principle Five: A Well-Functioning Board of Directors
The time commitment formally required by the Group is an overriding principle that each Director will devote as
much time as is required to carry out the roles and responsibilities that the Director has agreed to take on.
Relationships with suppliers, partners and contractors: the Group expects its suppliers and partners to adhere to
business principles consistent with its own and to implement appropriate polices and codes of conduct. The Group
is committed to maintaining positive relationships with its suppliers, partners and contractors.
Biographical details of the Directors are set out within the governance report on pages 32 and 33.
The Executive Directors are employed under service contracts requiring between three and twelve months’ notice
by either party. Non-Executive Directors and the Chairman are remunerated as part of their letters of agreements.
The Board encourages the ownership of shares in the Company by Executive and Non-Executive Directors alike
and in normal circumstances does not expect Directors to undertake dealings of a short-term nature.
The Board considers ownership of Company shares by Non-Executive Directors as a positive alignment of their
interest with shareholders. The Board will periodically review the shareholdings of the Non-Executive Directors
and will seek guidance from its advisors if, at any time, it is concerned that the shareholding of any Non-Executive
Director may, or could appear to, conflict with their duties as an independent Non-Executive Director of the
Company or their independence itself. Directors’ emoluments, including Directors’ interest in share options
over the Company’s share capital, are set out in the Directors’ Report.
The Board has established an Audit Committee, Remuneration Committee and a Nomination Committee.
Principle Six: Appropriate Skills and Experience of the Directors and a Group Company Secretary
The Board currently consists of seven Directors.
The Board considers that David Ciclitira, who acts as Executive Chairman is best placed to lead and deliver the
Group’s strategy. David founded the Group in its current form in 2017, and has the necessary skills, expertise and
global network of contacts to lead the Group through its next phase of expansion.
The Board of Directors have a diversified skillset, experience and qualities resulting in a well balanced Board to
deliver the strategy of the Group. The Group will ensure, where necessary, that all Directors receive the necessary
training to keep their skillset up to date.
All Directors have access to the Company Secretary who is responsible for ensuring that Board procedures and
applicable rules and regulations are observed.
Child safety and health and safety: we are fully aware of our, and our partners’ health and safety and child safety
responsibilities. All of our partners are obliged to comply with all local health and safety legislation to ensure the
safety of all children attending BRICKLIVE® events.
Our people: The Group has a dynamic team, which is highly valued. The Group has adopted a share incentive
scheme for staff to ensure they can participate in the long-term success of the Group.
Local communities: the Group is committed to being a responsible neighbour, with investment in local
communities and charitable causes where appropriate. In 2017, a BRICKLIVE Christmas Show was held in
the Saatchi Gallery and the Group operated in partnership with several local hospitals to raise funds for their
charitable causes.
The Company has adopted a share dealing code for the Directors and applicable employees of the Group for the
purpose of ensuring compliance by such persons with the provisions of the AIM rules relating to share dealings in
the Company’s securities. This particularly applies to the provisions of Rule 21 of the AIM Rules and the Market
Abuse Regulation. The Directors consider the share dealing code is appropriate for a Company whose shares are
admitted to trading on AIM.
38
BRICKLIVE Outer Space,
Yuri Gagarin, 2019
39
L I V E C O M P A N Y G R O U P P L C A N N U A L R E P O R T 2018
Principle Nine: Maintenance of Governance Structures and Processes
The Chairman has overall responsibility for corporate governance and promoting high standards throughout
the Group. He chairs the Board and leads in the development of strategy and setting objectives, oversees
communication between the Company and its shareholders. The corporate governance framework which the
Group operates is based upon practices which the Board considers appropriate for the size, risks and operations
of the business. The Board meetings occur at least four times a year and in 2018 there were ten Board meetings.
The Board is amongst other things, responsible for:
• Establishing and maintaining the Group’s system of internal controls;
• Setting strategic objectives and policies for the Group;
• Setting annual budgets and monitoring performance against budget;
• The preparation and approval of the Group’s annual report and accounts and interim results;
• Ensuring the financing needs of the Group are met;
• Approving the key terms of any significant contracts and significant expenditure;
• Employee welfare; and
• Shareholder communications.
The Non-Executive Directors provide a robust sounding board and challenge management where necessary.
The Audit Committee monitors the integrity of financial statements, oversees risk management and internal
controls, and reviews the independence of the external auditors. The members of the Audit Committee are:
Ranjit Murugason (Chair), David Ciclitira and Serenella Ciclitira. The Audit Committee meetings occur at least
twice each financial year and in 2018 met twice.
The Remuneration Committee sets and reviews the remuneration of executive Directors, and is responsible for
the implementation of any share-based incentive schemes, including the setting of targets and performance
frameworks relating to any such share-based incentive schemes. The members of the Remuneration Committee
are: Ranjit Murugason (Chair), Trudy Norris-Grey and Serenella Ciclitira. The Remuneration Committee meetings
occur at least twice each financial year and in 2018 met four times.
The Nomination Committee is responsible for succession planning and reviewing the Board composition to
ensure the Board has an effective blend of skills and experience. The members of the Nomination Committee are:
David Ciclitira (Chair), Ranjit Murugason, Serenella Ciclitira and Simon Horgan. The Nomination Committee
meetings occurs as and when required and in 2018 met twice.
The Executive Board retains full control of the Group’s operational management but has delegated day to day
control to Executive Directors. The Executive Board came into effect in Q1 2019. A full description of the
Executive Board is found on page 34.
Principle Ten: Shareholder Communication
The Board is committed to communicating effectively with its shareholders and responds quickly to queries
received. The Chairman is primarily responsible for communicating with shareholders and speaks regularly
with the Company’s major shareholders to ensure that their views are communicated to the Board. The Board
attempts to ensure that, where possible, all Directors are present at Company AGMs to meet with and listen to
the views of shareholders. To the extent that voting decisions are not in line with expectations, the Board will
engage with shareholders to understand and address any issues.
40
BRICKLIVE Outer Space, Neil Armstrong, 2019
L I V E C O M P A N Y G R O U P P L C A N N U A L R E P O R T 2018
SUSTAINABILITY AGENDA
We are committed to reviewing our environmental policy with regards to plastic consumption. We are proud to
produce fantastic models that can be enjoyed by all, the models have a ten year life span although individual
bricks can be used for a significantly longer period and be deemed ‘bricks for life’.
All ‘loose’ plastic bricks which can no longer be used in our famous brick pits will be recycled in our fantastic
models to avoid unnecessary disposal.
We are proud to be creating touring assets which can be exhibited in zoos across the world. Some of our tours
comprise of endangered and/or extinct animals which are not always available to discover in zoos.
In September 2018 we announced the Group and our Partner in China, BRICKLIVE Centre Education Technology
(Beijing) Co., Limited entered into a partnership with The Prince Albert II of Monaco Foundation to launch
BRICKLIVE Animal Paradise in China. We are working with the foundation and our local partner to educate
children in China about the need to protect and preserve the environment, endangered species and biodiversity.
We have produced a book to support the touring Animal Paradise exhibition and to educate visitors on each animal,
explaining their habitat and how we can aid their survival.
We have also donated to our partner charity The Prince Albert II of Monaco Foundation to fund new initiatives to
protect and conserve endangered species and biodiversity.
We are a global brand providing content around the world and are therefore conscious of our carbon footprint,
which is why we will seek to deliver as many tours and models using sea freight, where practical and possible.
Furthermore, we are establishing touring asset collections which will remain in certain geographic regions around
the world to ensure transport distances are minimised.
This strategic report was approved by the Board of Directors on 13 June 2019 and signed on its behalf by
DAVID CICLITIRA
Chairman
13 June 2019
42
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BRICKLIVE Animal Paradise, Grimaldi Forum, Monaco, December 2018
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DIRECTORS' REPORT for the year ended 31 Dec 2018
Basis of preparation, Forecasts and Assumptions
In accordance with section 414c(11) of the Companies Act 2006, the Directors have chosen to include information
about the future developments and principal risks and uncertainties in the Strategic Report.
The financial statements have been prepared on a going concern basis as set out in Note 1.1 to the financial
statements, which assumes that the Group will continue in operational existence for the foreseeable future.
The Directors have prepared trading and cash flow forecasts for the Group for the period to 31 December 2021.
Branches in the EU
The Group has no branches in the EU.
Dividend
No dividend is recommended in respect of the year ended 31 December 2018 (2017 - £Nil).
Directors
The Directors during the year and their periods of office were as follows:
David Ciclitira
Serenella Ciclitira
Ranjit Murugason
Simon Bennett
Andrew Smith
Bryan Lawrie
Trudy Norris-Grey
Simon Horgan
Executive Chairman
Non-Executive Director
Non-Executive Director
Non-Executive Director (resigned 31 August 2018)
Executive Director
Chief Financial Officer (appointed 17 October 2018)
Non-Executive Director (appointed 1 November 2018)
Non-Executive Director (appointed 1 November 2018)
Directors’ interests in shares
The beneficial interests in the Ordinary share capital of the Company of the Directors in office at
31 December 2018 were as follows:
Director
David Ciclitira (and owned companies)*
Serenella Ciclitira*
Ranjit Murugason
Andrew Smith
Bryan Lawrie
Simon Horgan (held through Horgan Investments Limited)
Trudy Norris-Grey
* connected persons
2018
Ordinary shares of 1p
Fully Paid
26,975,815
1,562
997,241
7,692
15,384
2,820,512
-
2017
Ordinary shares of 1p
Fully Paid
26,945,047
1,562
797,242
-
-
-
-
The number of 1p Ordinary shares or beneficial interest in the 1p Ordinary shares held by David Ciclitira
are as follows:
Holder
2018
Ordinary shares of 1p
2017
Ordinary shares of 1p
Beneficial interest
Substantial Shareholdings
The following investors notified the Directors that they currently hold or are beneficially interested in 3% or more
of the Company’s 1p Ordinary shares as at 31 May 2019:
David Ciclitira (and owned companies)
Brick Live Lab Ltd*
CIDEA Limited*
Clive Norgaard Morton
Fortune Access Ltd
Simon Horgan (held through Horgan Investments Limited)
Ed Diment
Duncan Titmarsh
*Brick Live Lab Ltd and CIDEA Limited are controlled by Mr Hyun Seok Kim
No of 1p
Ordinary shares
27,375,811
9,832,060
333,333
4,166,667
3,000,000
2,820,512
2,820,512
2,820,512
% of issued
share capital
38.86%
13.50%
0.46%
5.92%
4.26%
4.00%
4.00%
4.00%
Current Director Shareholdings
Set out below are the Directors’ interests in the Ordinary share capital of the Company as at 31 May 2019
together with details of options and warrants as set out in Notes 26 and 29.
David Ciclitira (and owned companies)*
Serenella Ciclitira*
Simon Horgan (held through Horgan Investments Limited)
Ranjit Murugason
Andrew Smith
Bryan Lawrie
Trudy Norris-Grey
* connected persons
No of 1p
Ordinary shares
27,375,811
1,562
2,820,512
1,220,317
7,692
15,384
-
% of issued
share capital
38.86
0.00
4.00
1.73
0.01
0.02
0.00
No. of
warrants
480,765
-
-
-
-
-
-
No. of
options
1,341,891
-
-
-
670,945
335,472
-
Directors’ Liability Insurance
During the year, Directors’ and officers’ liability insurance was maintained for Directors and other officers of the
Company as permitted by the Companies Act 2006.
Disclosure of Information to Auditor
In the case of each of the Directors who are Directors of the Company at the date when this report is approved:
• So far as they are individually aware, there is no relevant audit information of which the Company’s auditor is
unaware; and
• Each of the Directors has taken all the steps that they ought to have taken as a director to make themselves
aware of any relevant audit information and to establish that the Company’s auditor is aware of the information.
Auditor
The Company re-appointed Kingston Smith LLP as auditors for the Company for the financial year 2018.
A resolution to re-appoint Kingston Smith LLP will be put to the shareholders at the next Annual General Meeting.
David Ciclitira
26,652,849
26,622,081
Held by D Ciclitira directly
On behalf of the Board
Zedra Trustees (Jersey) Limited
Luna Trading Ltd
206,532
116,434
206,532
A discretionary trust, of which
D Ciclitira is a potential beneficiary
116,434
A company held by a discretionary
trust, of which D Ciclitira is
a potential beneficiary
Serenella Ciclitira
1,562
1,562
26,977,377
26,946,609
Held indirectly by Serenella
Ciclitira (long term partner of
D Ciclitira)
The above table constitutes the David Ciclitira Concert Party.
44
DAVID CICLITIRA
Chairman
13 June 2019
45
LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
DIRECTORS' RESPONSIBILITIES STATEMENT
The Directors are responsible for preparing the Strategic Report, the Directors’ Report and the financial
statements in accordance with applicable law and regulations.
Company law requires the Directors to prepare Group and Company financial statements for each financial year.
As required by the AIM Rules of the London Stock Exchange, the Directors have prepared the Group financial
statements in accordance with International Financial Reporting Standards as adopted by the European Union and
have also elected to prepare the parent Company financial statements in accordance with those standards. Under
Company law the Directors must not approve the financial statements unless they are satisfied that they give a
true and fair view of the state of affairs of the Company and the Group and of the profit or loss of the Group for
that period.
In preparing these financial statements the Directors are required to:
• Select suitable accounting policies and then apply them consistently;
• Make judgements and accounting estimates that are reasonable and prudent;
• State whether the Group financial statements have been prepared in accordance with IFRSs as adopted by the
European Union; and
• Prepare the financial statements on the going concern basis unless it is inappropriate to presume that the
Company and the Group will continue in business.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the
Group’s transactions and disclose with reasonable accuracy at any time the financial position of the Company and
the Group and enable them to ensure that the financial statements comply with the Companies Act 2006. They
are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable
steps for the prevention and detection of fraud and other irregularities.
The Directors are responsible for the maintenance and integrity of the corporate and financial information
included on the Company’s website. Legislation in the United Kingdom governing the preparation and
dissemination of the financial statements and other information included in annual reports may differ
from legislation in other jurisdictions.
REPORT OF THE INDEPENDENT AUDITOR
Opinion
We have audited the financial statements of Live Company Group Plc (the ‘parent Company’ and its
subsidiaries (the ‘Group’)) for the year ended 31 December 2018, which comprise the Consolidated Statement
of Comprehensive Income, the Consolidated and Parent Company Statements of Financial Position, the
Consolidated and Parent Company Statements of Changes in Equity, the Consolidated and Parent Company
Statements of Cash Flows and Notes to the financial statements, including a summary of significant
accounting policies.
The financial reporting framework that has been applied in their preparation is applicable law and International
Financial Reporting Standards (IFRSs) as adopted by the European Union and, as regards the parent Company
financial statements, as applied in accordance with the provisions of the Companies Act 2006.
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In our opinion:
• The financial statements give a true and fair view of the state of the Group’s and of the parent Company’s affairs
as at 31 December 2018 and of the Group’s loss for the year then ended;
• The Group financial statements have been properly prepared in accordance with IFRSs as adopted by the
European Union;
• The parent Company financial statements have been properly prepared in accordance with IFRS as adopted by
the European Union and as applied in accordance with the provisions of the Companies Act 2006; and
• The financial statements have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable
law. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the audit
of financial statements section of our report. We are independent of the Group in accordance with the ethical
requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical
Standard as applied to listed entities, and we have fulfilled our other ethical responsibilities in accordance with
these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide
a basis for our opinion.
Conclusions relating to going concern
We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to
report to you where:
• The directors’ use of the going concern basis of accounting in the preparation of the financial statements is not
appropriate; or
• The directors have not disclosed in the financial statements any identified material uncertainties that may cast
significant doubt about the Group’s or the parent Company’s ability to continue to adopt the going concern basis
of accounting for a period of at least twelve months from the date when the financial statements are authorised
for issue.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit
of the financial statements of the current period and include the most significant assessed risks of material
misstatement (whether or not due to fraud) we identified, including those which had the greatest effect on: the
overall audit strategy; the allocation of resources in the audit; and directing the efforts of the engagement team.
These matters were addressed in the context of our audit of the financial statements as a whole, and in forming
our opinion thereon, and we do not provide a separate opinion on these matters.
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LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
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Audit area and description
Audit approach
Impairment of Goodwill
The consolidated financial statements include goodwill
of £4.307m in respect of the acquisition of Parallel Live
Group (£1.271m), acquisition of the remaining shares
in Brick Live Far East (£2.950m) and the acquisition of
Bright Bricks (£0.086m).
We re-performed the calculations of the cost of
investment and goodwill arising on the acquisition
of Bright Bricks in the year.
We assessed the Directors’ assertion that no
impairment was required in respect of goodwill
arising on the acquisitions by reference to trading
performance and cash and profit forecasts of the
acquired entities.
We critically assessed and challenged the assumptions
made by the Directors in their preparation of the cash
and profit forecasts including an assessment against
current year trading to date.
Audit area and description
Audit approach
Assessment of Fair Values on Acquisition
The acquisition of Bright Bricks included fair value
adjustments to the carrying value of content assets
included within Property, Plant and Equipment and
inventories of £1.180m and £4.997m respectively
We re-performed the calculation of the fair values
made by the Directors.
We critically assessed and challenged the
assumptions made by the Directors in their
calculation of the fair values.
We critically assessed whether the fair value
adjustments made by the Directors are in
accordance with IFRS 3 and IFRS 13.
Our application of materiality
The scope and focus of our audit was influenced by our assessment and application of materiality. We define
materiality as the magnitude of misstatement that could reasonably be expected to influence the readers and
the economic decisions of the users of the financial statements. We use materiality to determine the scope of
our audit and the nature, timing and extent of our audit procedures and evaluate the effect of misstatements
both individually and on the financial statements as a whole.
We considered revenue to be the main focus for readers of the financial statements, and this influenced our
judgement of materiality. Based on our professional judgement we determined materiality for the Group to be
£64,000 based on a percentage of revenue.
We agreed to report to the Audit Committee all audit differences in excess of the threshold that we had calculated
as clearly trivial to the financial statements, and any other differences that, in our view, warranted reporting on
qualitative grounds. We also reported disclosure matters that we identified when assessing the overall
presentation of the financial statements.
An overview of the scope of our audit
Our audit of the Group and parent Company financial statements was scoped by obtaining an understanding of
the Group and parent Company and their environment, including Group wide controls, and assessing the risks of
material misstatement at the Group and parent Company level. The whole of the Group is audited by one audit
team, led by the Senior Statutory Auditor. Our approach in respect of key audit matters is set out in the table in
the Key Audit Matters section.
The audit is performed centrally and comprises all of the companies within the Group, significant components of
which were visited by the audit team.
Other information
The Directors are responsible for the other information. The other information comprises the information
included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on
the financial statements does not cover the other information and, except to the extent otherwise explicitly stated
in our report, we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and,
in doing so, consider whether the other information is materially inconsistent with the financial statements or
our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material
inconsistencies or apparent material misstatements, we are required to determine whether there is a material
misstatement in the financial statements or a material misstatement of the other information. If, based on the
work we have performed, we conclude that there is a material misstatement of this other information, we are
required to report that fact.
Audit area and description
Audit approach
We have nothing to report in this regard.
Discontinued Operations
The Directors have classified the ceasing of operations
in respect of shows organised by Parallel Live Group
subsidiaries, under the LEGO® LIVE trademark, as
discontinued operations in the year.
We have re-performed the calculation of revenue and
expenses classified within discontinued operations.
We considered whether the Directors assertion
that the relevant operations can be classified as
discontinued operations was appropriate by critically
assessing whether the operations meet the criteria as
set out in IFRS 5.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
• The information given in the Strategic Report and the Directors’ Report for the financial year for which the
financial statements are prepared is consistent with the parent Company financial statements; and
• The Strategic Report and the Directors’ Report have been prepared in accordance with applicable legal
requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the Group and the parent Company and its environment
obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the
Directors’ Report.
48
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LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
0
1
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
0
2
G
O
V
E
R
N
A
N
C
E
I
0
3
F
N
A
N
C
A
L
S
I
We communicate with those charged with governance regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including any significant deficiencies in internal control that we
identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other matters that
may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were
of most significance in the audit of the consolidated financial statements of the current period and are therefore
the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not
be communicated in our report because the adverse consequences of doing so would reasonably be expected to
outweigh the public interest benefits of such communication.
Use of our report
This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the
Companies Act 2006. Our audit work has been undertaken for no purpose other than to draw to the attention of
the Company’s members those matters which we are required to include in an auditor’s report addressed to them.
To the fullest extent permitted by law, we do not accept or assume responsibility to any party other than the
Company and Company’s members as a body, for our work, for this report, or for the opinions we have formed.
Matthew Banton (Senior Statutory Auditor)
for and on behalf of Kingston Smith LLP, Statutory Auditor
13 June 2019
Devonshire House
60 Goswell Road
London EC1M 7AD
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report
to you if, in our opinion:
• Adequate accounting records have not been kept by the parent Company, or returns adequate for our audit have
not been received from branches not visited by us; or
• The parent Company financial statements are not in agreement with the accounting records and returns; or
• Certain disclosures of directors’ remuneration specified by law are not made; or
• We have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the Directors’ Responsibilities Statement set out on page 46, the Directors are
responsible for the preparation of the financial statements and for being satisfied that they give a true and fair
view, and for such internal control as the directors determine is necessary to enable the preparation of financial
statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the Directors are responsible for assessing the Group’s and the parent
Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and
using the going concern basis of accounting unless the directors either intend to liquidate the Group or the parent
Company or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our
opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in
accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise
from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected
to influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with ISAs (UK) we exercise professional judgement and maintain professional
scepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error,
design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and
appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purposes of expressing an opinion on the effectiveness of the
Group’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and
related disclosures made by the Directors.
• Conclude on the appropriateness of the Directors’ use of the going concern basis of accounting and, based on
the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast
significant doubt on the Group’s or the parent Company’s ability to continue as a going concern. If we conclude
that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related
disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion.
Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future
events or conditions may cause the Group or the parent Company to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures,
and whether the financial statements represent the underlying transactions and events in a manner that achieves
fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business
activities within the Group to express an opinion on the consolidated financial statements. We are responsible for
the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion.
50
51
LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
BRICKLIVE Mythical Beasts, Hippogriff Model , Bournemouth International Centre, 2018
03
FINANCIALS
52
53
0
1
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
0
2
G
O
V
E
R
N
A
N
C
E
I
0
3
F
N
A
N
C
A
L
S
I
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME for the year ended 31 December 2018
STATEMENTS OF FINANCIAL POSITION as at 31 December 2018
Year to 31 December
Consolidated
Company
Revenue
Cost of sales
Gross profit (loss)
Administrative expenses
Foreign exchange
Depreciation and amortisation of
non-financial assets
Other administrative expenses
Total administrative expenses
Operating loss before exceptional items
Exceptional items
Operating loss after exceptional items
Finance costs
Loss for the year before tax
Tax expense
Loss for the year attributable to the
equity holders of the parent Company
Other comprehensive income
Total comprehensive income for the year
attributable to the equity holders of the
parent Company
Loss per share
-basic and diluted
Continuing
activities
2018
£’000
Discontinued
activities
2018
£’000
4,920
(2,662)
2,258
41
(24)
(3,038)
(3,021)
(763)
(1,339)
(2,102)
(8)
(2,110)
-
431
(931)
(500)
-
-
-
-
(500)
-
(500)
-
(500)
-
Note
4
6
7
11
12
Total
2018
£’000
5,351
(3,593)
1,758
41
(24)
(3,038)
(3,021)
(1,263)
(1,339)
(2,602)
(8)
(2,610)
-
Continuing
activities
2017
£’000
1,928
(826)
1,102
(26)
(1)
(1,466)
(1,493)
(391)
(5,037)
(5,428)
(12)
(5,440)
-
(2,110)
(500)
(2,610)
(5,440)
-
-
-
-
(2,110)
(500)
(2,610)
(5,440)
13
(3.8)p
(0.9)p
(4.7)p
(11.3)p
Non-current assets
Property, plant and equipment
Intangible assets
Investments
Goodwill
Investments in associates
Total non-current assets
Current assets
Inventories
Trade and other receivables
Cash and cash equivalents
Total current assets
Current liabilities
Borrowings
Trade and other payables
Deferred income and accruals
Total current liabilities
Net current assets (liabilities)
Non-current liabilities
Deferred tax
Total non-current liabilities
Net assets
Equity
Share capital
Share premium
Other reserves
Merger reserve
Capital redemption reserve
Retained earnings
Note
14
15
16
17
18
19
20
21
22
23
23
25
26
27
2018
£’000
3,551
50
-
4,307
-
7,908
6,491
692
120
7,303
1,000
2,512
849
4,461
2017
£’000
798
1
-
4,221
-
5,020
-
1,125
871
1,996
-
2,557
1,603
4,160
2,842
(2,164)
123
123
12
12
2018
£’000
-
-
17,450
-
-
17,450
-
2,510
2
2,512
1,000
1,663
-
2,663
(151)
-
-
2017
£’000
-
1
8,950
-
-
8,951
-
219
842
1,061
-
1,645
-
1,645
(584)
-
-
10,627
2,844
17,299
8,367
4,754
18,470
(23,697)
14,067
5,034
(8,001)
4,566
13,695
(23,711)
8,651
5,034
(5,391)
4,754
18,470
557
14,067
5,034
(25,583)
4,566
13,695
557
8,651
5,034
(24,136)
Equity attributable to equity holders
of the parent
10,627
2,844
17,299
8,367
As permitted by section 408 of the Companies Act 2006 the parent company’s profit and loss account
has not been included in these financial statements. The parent company loss for the year was £1,447,000
(2017: £664,000 loss).
The financial statements were approved and authorised for issue by the Board of Directors on 13 June 2019
and were signed on its behalf by:
DAVID CICLITIRA
Chairman
Company Registration No. 00630968
54
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LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
0
1
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
0
2
G
O
V
E
R
N
A
N
C
E
I
0
3
F
N
A
N
C
A
L
S
I
STATEMENTS OF CHANGES IN EQUITY for the year ended 31 December 2018
STATEMENTS OF CASH FLOWS for the year ended 31 December 2018
Ordinary
Share
Capital
£’000
Share
Premium
Reverse
acquisition
reserve
£’000
£’000
Forex
and other
reserves
£’000
Merger
reserve
Capital
Redemption
reserve
Retained
Earnings
Total
£’000
£’000
£’000
£’000
Consolidated
As at 31 December 2017
Loss for the year
Shares issued for cash
Shares issued as consideration
for acquisitions
Debt to share conversion
Share issue costs
At 31 December 2018
Company
As at 31 December 2017
Loss for the year
Shares issued for cash
Shares issued as consideration
for acquisitions
Debt to share conversion
Share issue costs
At 31 December 2018
4,566
-
101
85
2
-
4,754
4,566
-
101
85
2
-
4,754
13,695
-
4,848
-
153
(226)
18,470
13,695
-
4,848
-
153
(226)
18,470
(24,268)
-
-
-
-
-
(24,268)
-
-
-
-
-
-
-
557
14
-
-
-
-
571
557
-
-
-
-
-
557
8,651
-
-
5,415
-
-
14,067
8,651
-
-
5,415
-
-
14,067
5,034
-
-
-
-
-
5,034
5,034
-
-
-
-
-
5,034
(5,391)
(2,610)
-
-
-
-
(8,001)
(24,136)
(1,447)
-
-
-
-
(25,583)
2,844
(2,596)
4,950
5,500
155
(226)
10,627
8,367
(1,447)
4,950
5,500
155
(226)
17,299
Ordinary
Share
Capital
£’000
Share
Premium
Reverse
acquisition
reserve
£’000
£’000
Forex
and other
reserves
£’000
Merger
reserve
Capital
Redemption
reserve
Retained
Earnings
Total
£’000
£’000
£’000
£’000
Consolidated
As at 31 December 2016
Prior period adjustment
As at 31 December 2016
(restated)
Loss for the year
Shares issued for cash
Shares issued as consideration
for acquisitions
Debt to share conversion
At 31 December 2017
Company
As at 31 December 2016
Prior period adjustment
At 31 December 2016
(restated)
Loss for the year
Shares issued for cash
Shares issued as consideration
for acquisitions
Debt to share conversion
At 31 December 2017
4,612
(498)
4,114
-
42
298
112
4,566
4,612
(498)
4,114
-
42
298
112
4,566
8,741
498
(18,944)
-
9,239
-
1,218
(18,944)
-
-
-
3,238
13,695
(5,324)
-
(24,268)
8,741
498
9,239
-
1,218
-
3,238
13,695
-
-
-
-
-
-
-
-
557
-
557
-
-
-
-
557
557
-
557
-
-
-
-
557
-
-
-
-
-
8,651
-
8,651
-
-
-
-
-
8,651
-
8,651
5,034
-
5,034
-
-
-
-
5,034
49
-
49
-
49
(5,440)
-
-
-
(5,391)
49
(5,440)
1,260
3,625
3,350
2,844
5,034
-
(23,472)
-
(4,528)
-
5,034
-
-
-
-
5,034
(23,472)
(664)
-
-
-
(24,136)
(4,528)
(664)
1,260
8,949
3,350
8,367
Cash flows from operating activities
Operating loss
Depreciation
Amortisation of intangibles - trademarks
Impairment provision
David Ciclitira commission paid
Director fees capitalised
Increase in inventories
Decrease/(increase) in receivables
(Decrease)/increase in payables
Increase in provisions
Cash (used in)/generated from operations
Cash flow from investing activities
Acquisition of trademarks
Acquisition of Bright Bricks
Acquisition of property, plant and equipment
Cash acquired on acquisition of subsidiary
Net cash (used in) investing
activities
Cash flow from financing activities
Issue of equity
Proceeds from borrowings
Shares issued to settle fees
Loans repaid
Interest paid
Share issue costs
Net cash generated from financing activities
Reconciliation impact of reverse
acquisition accounting
Consolidated
Company
2018
£’000
(1,263)
365
5
1
-
-
(74)
1,074
(3,438)
30
(3,300)
(55)
(2,167)
(988)
43
(3,167)
4,950
1,000
155
-
(8)
(226)
5,716
2017
£’000
(391)
118
-
-
(355)
-
-
(20)
2,936
-
2,288
-
-
(740)
-
(740)
1,260
-
-
(12)
-
1,248
-
(1,925)
2018
£’000
(1,018)
-
-
-
-
-
-
(2,290)
(1,089)
-
(4,397)
-
(2,167)
-
-
(2,167)
4,950
1,000
-
-
(226)
5,724
-
Net cash (outflow) inflow
(751)
871
(840)
Cash and cash equivalents at beginning of
the year
Net (decrease) / increase in cash and cash
equivalents
Cash and cash equivalents at end of the year
871
(751)
120
-
871
871
842
(840)
2
2017
£’000
(1,585)
-
-
-
-
220
-
(241)
1,344
-
(262)
-
-
-
-
-
1,260
-
(81)
(93)
-
1,086
-
824
18
824
842
56
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LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
0
1
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
0
2
G
O
V
E
R
N
A
N
C
E
I
0
3
F
N
A
N
C
A
L
S
I
NOTES FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 31 December 2018
1. Basis of preparation
These financial statements have been prepared on the historical cost basis as modified by use of the fair-value
basis where required and in accordance with International Financial Reporting Standards (IFRS) as adopted by the
European Union, and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS
as at 31 December 2018.
The preparation of financial statements in conformity with IFRS requires management to make judgements,
estimates and assumptions that affect the application of policies and reported amounts in the financial
statements which are disclosed in Note 3 to these consolidated financial statements.
1.1 Going concern
These financial statements have been prepared on a going concern basis. The Consolidated Statement of
Comprehensive Income shows a loss of £2,610,000 for the year ended 31 December 2018 (2017: £5,440,000
loss). In assessing going concern the Directors consider the Groups cash flows, solvency and liquidity positions.
The Directors have prepared trading and cash flow forecasts for the Group up to and including the year ending
31 December 2021. The forecasts incorporate a number of trading assumptions, including income from existing
contracts, and contracts which are in the process of being negotiated. The forecasts show that the Group has
sufficient cash to meet its liabilities as they fall due for a period of at least 12 months from the date of signature
of these consolidated financial statements.
The Directors believe these forecasts to be realistic and consequently have prepared these consolidated financial
statements on the going concern basis, which assumes that the Group will continue in operational existence for
the foreseeable future.
1.2 Adoption of standards effective in 2018
The financial statements are prepared in accordance with International Financial Reporting Standards and
Interpretations as adopted by the EU in force at the reporting date.
New and Revised Standards
The following standards were implemented in the year but with no material impact on the Group.
• IFRS 9, ‘Financial Instruments’
• IFRS 15, ‘Revenue from Contracts with Customers’
• IFRS 10 and IAS 28 (amendments), ‘Sale or Contribution of Assets between an Investor and its Associate or
Joint Venture’
• Amendments to IFRS 2, ‘Classification and Measurement of Share-based Payment Transactions’
• Amendments to IAS 7, ‘Disclosure Initiative’
• Amendments to IAS 12, ‘Recognition of Deferred Tax assets for Unrealised Losses’
There have been improvements to standards which provide clarifications rather than substantive changes to
existing requirements.
IFRS 9 ‘Financial Instruments’ took effect from 1 January 2018 and has been adopted for the year ended
31 December 2018 using the full retrospective method. The Group has reassessed the classification and
measurement of financial instruments and this has not given rise to any changes except that financial assets
previously classified as “loans and receivables” under IAS 39 are now presented as “financial assets at amortised
cost” in the financial statements.
IFRS 15 ‘Revenue from Contracts with Customers’ also took effect from 1 January 2018 and has been adopted for
the year ended 31 December 2018 using the full retrospective method. The revenue recognition accounting policy
applied prior to adoption of IFRS 15 by the Group is consistent with the requirements of IFRS 15, and therefore
adoption of the standard has not affected amounts recognised in the current or comparative periods.
The application of the other revised Interpretations, Amendments and Annual Improvements has not had any
material impact on the amounts reported for the current and prior years but may affect the accounting for future
transactions or arrangements.
IFRS in issue but not applied in the current financial statements
The following IFRS and IFRIC Interpretations have been issued but have not been applied by the Group and the
Company in preparing these financial statements, as they are not as yet effective and, in some cases, had not
yet been adopted by the EU. The Group intends to adopt these Standards and Interpretations when they become
effective, rather than adopt them early.
• IFRS 16 ‘Leases’
• Amendments to IAS 28 ‘Long term Interests in Associates and Joint Ventures’
• Amendments to IFRS 10 ‘Sale or Contribution of Assets between an Investor and its Associate or Joint Venture’
The Directors do not expect that the adoption of the Standards listed above will have a material impact on the
Group in future periods except that IFRS 16 is a significant change to lease accounting. All leases will require
balance sheet recognition of a liability and a right-of-use asset except short term leases and leases of low value.
The Group’s operating lease liability at 31 December 2018 as detailed in Note 32 is £173,000, IFRS 16 will require
this amount to be discounted by an estimated cost of borrowings which will result in a right-of-use asset
recognised, being the present value of the operating lease payments over the remaining life of the lease,
together with a corresponding liability.
2. Accounting policies
2.1 Basis of consolidation
The consolidated financial statements incorporate:
• The results of LVCG, Brick Live Group Limited (“Brick Live Group”) and Parallel Live Group Limited
(“Parallel Live Group”) for the year ended 31 December 2018 and Bright Bricks for the period from acquisition
to 31 December 2018; and
• The assets and liabilities of LVCG, Brick Live Group, Parallel Live Group, Bright Bricks and their subsidiary
companies at 31 December 2018.
Business combinations
The information contained in this note sets out how the Group typically accounts for Business Combinations,
which is effectively using the purchase method explained in IFRS3, “Business Combinations”.
The cost of an acquisition is measured as an aggregate of the consideration transferred, measured at the
acquisition date fair-value and the amount of any non-controlling interest in the acquiree. For each business
combination, the Group measures the non-controlling interest in the acquiree at the proportionate share of the
acquiree’s identifiable net assets. Subsequent changes in the proportion of the non-controlling interests, which
do not result in de-recognition of the subsidiary, are accounted for in equity. Costs incurred in connection with
acquisitions are recognised as exceptional costs in the income statement, as incurred.
When the Group acquires a business, it assesses the financial assets and liabilities assumed for appropriate
classification and designation in accordance with the contractual terms, economic circumstances and pertinent
conditions at the acquisition date.
If the business combination is achieved in stages, the acquisition date fair-value of the Group’s previously held
equity interest in the acquiree is re-measured to fair-value at the acquisition date through profit or loss. Goodwill
is initially measured at cost being the excess of the consideration transferred over the Group’s share of net
identifiable assets acquired and liabilities assumed.
If this consideration is lower than the fair-value of nets assets of the subsidiary acquired, the difference is
recognised in profit or loss.
After initial recognition, goodwill is measured at cost less any recognised impairment losses. For the purpose of
impairment testing, goodwill acquired in a business combination is, from the acquisition date, allocated to either
the acquired business or to each of the Group’s cash generating units that are expected to benefit from the
combination irrespective of whether other assets or liabilities of the acquiree are assigned to those units.
Where goodwill forms a part of a cash-generating unit and part of the operation within that unit is disposed of,
the goodwill associated with the operation disposed of is included in the carrying amount of the operation when
determining the gain or loss on disposal of the operation. Goodwill disposed of in these circumstances is measured
based on the relative values of the operation disposed of and the portion of the cash-generating unit until retained.
58
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LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
0
1
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
0
2
G
O
V
E
R
N
A
N
C
E
I
0
3
F
N
A
N
C
A
L
S
I
Bright Bricks
In October 2018 and as set out in Note 28, LVCG acquired Bright Bricks and its subsidiaries for a consideration
of £8,500,000, comprising consideration of £2,167,000 cash, deferred consideration of £833,333 and 8,461,536
new Ordinary shares in the Company with a nominal value of 1p and a price of 65p per share.
The acquisition of Bright Bricks was accounted for using the purchase method of accounting. Under the purchase
method the results of subsidiary undertakings are included from the date of acquisition and the goodwill value
is calculated as the difference between the fair value of the consideration and the fair value of the net assets at
the date of the acquisition. LVCG’s legal investment in Bright Bricks was subject to a formal impairment review
by the Directors prior to signing these consolidated financial statements, who concluded that no impairment
was required.
The fair value of the consideration was £8,500,000, the fair value of the net assets of the Bright Bricks
at acquisition were £8,414,335 and therefore a goodwill asset arose relating to this acquisition of £85,665.
This goodwill was subject to a formal impairment review by the Directors prior to signing these consolidated
financial statements, who concluded that no impairment was required.
Parallel Live Group
On 27 December 2017, the Group acquired Parallel Live Group, resulting in goodwill arising of £1,271,000.
This goodwill was subject to a formal impairment review by the Directors prior to signing these consolidated
financial statements, who concluded that no impairment was required.
Brick Live Far East Limited (“BLFE”)
On 27 December 2017, the Company became the 100% owner of BLFE. A goodwill asset of £2,950,000 arose
on the acquisition. BLFE is a company registered in Hong Kong which owns a 49% stake in the Brick Live Group’s
China associate company, Brick Live Centre Education Development (Beijing) Company Limited.
This goodwill was subject to a formal impairment review by the Directors prior to signing these consolidated
financial statements, who concluded that no impairment was required.
Intercompany balances
All intercompany balances are eliminated on consolidation.
2.2 Trademarks
Trademarks are registered in each of the geographical territories for the BRICKLIVE brand.
Trademarks are amortised over their estimated useful lives, which is on average 10 years.
2.3 Tournament rights
The rights to promote European Tour golf events were acquired in September 2006. These intangible assets were
intended to be amortised over their expected life of 20 years.
However, these assets were impaired to a net book value of £1,000 as of 31 December 2017 and to £nil as of
31 December 2018 to reflect the fact that the ongoing business of the Group is not expected to generate revenues
from these rights in the foreseeable future.
2.4 Investment in associates and joint ventures
An associate is an entity over which the Group has significant influence and that is neither a subsidiary nor an
interest in a joint venture. Significant influence is the power to participate in the financial and operating policy
decisions of the investee but does not have control or joint control over those policies.
A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights
to the net assets of the joint arrangement. Joint control is the contractually agreed sharing of control of an
arrangement, which exists only when decisions about the relevant activities require unanimous consent of the
parties sharing control.
2.5 Property, plant and equipment
All property, plant and equipment assets are stated at cost less accumulated depreciation.
Depreciation is provided on content over eight years on a straight-line basis to reflect their useful life. Residual
values, remaining useful lives and depreciation methods are reviewed annually and adjusted if appropriate.
Content is capitalised in the periods in which they are purchased or completed and valued at the lower of cost and
net realisable value.
Depreciation on other fixtures, fittings and office equipment is provided at 20% on a straight-line basis. Residual
values, remaining useful lives and depreciation methods are reviewed annually and adjusted if appropriate.
2.6 Impairment of assets
The carrying amounts of the Group’s assets, other than inventories, are reviewed at each reporting date to
determine whether there is any indication of impairment.
An impairment loss is recognised whenever the carrying amount of an asset or its cash-generating unit exceeds
its recoverable amount. Impairment losses are recognised in the Statement of Comprehensive Income.
An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable
amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the
carrying amount that would have been determined, net of depreciation, if no impairment loss had been recognised.
The Directors have carried out a formal impairment review on all material assets at 31 December 2018.
Impairment adjustments have been made to the Tournament rights and the BLFE associate investment in
Bricklive Centre Education Development (Beijing) Co. Limited as set out respectively in Notes 2.2, 15 and 18
to these consolidated financial statements.
2.7 Inventories
Inventories are stated at the lower of cost and net realisable value. Cost comprises direct materials and, where
applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their
present location and condition. Cost is calculated using a weighted average cost method. Net realisable value
represents the estimated selling price less all estimated costs of completion and costs to be incurred in
marketing, selling and distribution.
2.8 Financial instruments
The Group classifies financial instruments, or their component parts, on initial recognition as a financial asset,
a financial liability or an equity instrument in accordance with the substance of the contractual arrangement.
Financial instruments are recognised on trade date when the Group becomes a party to the contractual
provisions of the instrument. Financial instruments are recognised initially at fair-value plus, in the case of a
financial instrument not at fair-value through profit and loss, transaction costs that are directly attributable
to the acquisition or issue of the financial instrument.
Financial instruments are derecognised on trade date when the Group is no longer a party to the contractual
provisions of the instrument.
2.9 Trade and other receivables
Trade and other receivables are stated at their amortised cost. Trade receivables are reduced by appropriate
allowances for estimated irrecoverable amounts.
A loss allowance is recognised on initial recognition of financial assets held at amortised cost, based on
expected credit losses, and is re-measured annually with changes appearing in profit or loss. Where there has
been a significant increase in credit risk of the financial instrument since initial recognition, the loss allowance
is measured based on lifetime expected losses. In all other cases, the loss allowance is measured based on
12-month expected losses. For assets with a maturity of 12 months or less, including trade receivables, the
12-month expected loss allowance is equal to the lifetime expected loss allowance.
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LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
2.10 Cash and cash equivalents
Cash equivalents comprise short-term, highly liquid investments that are readily convertible into known amounts
of cash and which are subject to an insignificant risk of changes in value.
2.11 Trade and other payables
Trade and other payables are stated at their amortised cost.
2.12 Interest-bearing borrowings (other than compound financial instruments)
Interest-bearing borrowings are stated at amortised cost using the effective interest method. The effective
interest method is a method of calculating the amortised cost of a financial liability and of allocating interest
expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future
cash payments through the expected life of the financial liability.
2.13 Revenue recognition
Revenue is the value of goods and services provided by the Group to customers, net of VAT and discounts.
Revenue includes licence fees, revenue from the sale of products, rental fees, sale of content
(brick-based statues), brick lease fees and ticket sales from self-promoted events.
Revenue from contracts is recognised in accordance with IFRS 15 as follows:
(i) Identify the contract with the customer;
(ii) Identify separate performance obligations in the contract;
(iii) Determine the transaction price;
(iv) Allocate the transaction price to separate performance obligations; and
(v) Recognise revenue when the entity satisfies a performance obligation.
Revenue recognised as above is measured on the following basis:
(i) Annual licence fees – on a straight-line basis in accordance with the terms of the agreement, unless it is
non-refundable in which case fees are recognised on the contractual invoice date;
(ii) Event licence fees and revenue shares – on the completion of the event in accordance with the terms of the
agreement;
(iii) Content fees – on delivery of the specific content to the client in accordance with the terms of the agreement;
(iv) Tour and show rental fees – in accordance with the terms of the agreement;
(v) Brick lease fees – on a straight-line basis in accordance with the terms of the agreement;
(vi) Ticket sales from self-promoted events – on the date of the event; and
(vii)Sales of products - in accordance with contract, some of which include a non-refundable up-front payment to
reflect the specific design element of the sale.
2.14 Deferred taxation
Deferred tax is provided in full using the balance sheet liability method. Deferred tax is the future tax
consequences of temporary differences between the carrying amounts and tax bases of assets and
liabilities shown on the Statement of Financial Position.
The amount of deferred tax provided is based on the expected manner of recovery or settlement of the carrying
amount of assets and liabilities, using tax rates enacted or substantively enacted at the reporting date.
The Group does not recognise deferred tax liabilities, or deferred tax assets, on temporary differences associated
with investments in subsidiaries, as it is not considered probable that the temporary differences will reverse in the
foreseeable future.
A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available
against which the asset can be utilised. The carrying amounts of the deferred tax assets are reviewed at each
statement of financial position date and reduced to the extent that it is no longer probable that sufficient taxable
profit will be available to allow all or part of the assets to be recovered.
2.15 Segmental reporting
The Group has two operating segments, namely: tours, events, shows, licences and content rental fees; and
product and content sales. In identifying these operating segments, management generally follows the Group’s
service lines representing its main products and services (see Note 4).
For management purposes, the Group uses the same measurement policies as those used in its consolidated
financial statements, except for certain items not included in determining the operating profit of the operating
segments, such as exceptional costs.
In addition, corporate assets and expenses which are not directly attributable to the business activities of any
operating segment are not allocated to a segment. This primarily applies to the Group’s headquarters.
0
1
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
0
2
G
O
V
E
R
N
A
N
C
E
I
0
3
F
N
A
N
C
A
L
S
I
2.16 Foreign currencies
Monetary assets and liabilities expressed in foreign currencies are translated at the rates of exchange ruling at the
reporting date. Transactions in foreign currencies are translated at the rate ruling at the date of the transaction.
Differences on exchange arising on translation of subsidiaries are charged directly to other comprehensive income.
All other exchange differences have been charged to the Income Statement in the period under review.
2.17 Exceptional items
Exceptional items are those costs incurred by the Group which are considered by the Directors to be material
in size and are unusual and infrequent in occurrence which require separate disclosure within the financial
statements. See Note 7 for details of exceptional items ensuing in the year.
3. Accounting estimates and judgements
The preparation of these consolidated financial statements in accordance with generally accepted accounting
practice, being International Financial Reporting Standards as adopted by the European Union, requires the
Directors to make estimates and judgements that affect the reported amount of assets, liabilities, income and
expenditure and the disclosures made in these consolidated financial statements. Such estimates and judgements
are continually evaluated based on historical experience and other factors, including expectations of future events.
The significant judgements made by management in applying the Group’s accounting policies as set out above,
and the key sources of estimation which management consider may have a significant risk of causing a material
adjustment to the reported amounts in the year, were:
Impairment of investments and goodwill
The Directors have carried out an impairment review of the Company’s £8,500,000 investment in Bright Bricks,
£5,000,000 investment in Brick Live Group, £1,000,000 investment in Parallel Live and £2,950,000 investment
in BLFE. The Directors determined that no impairment of these investments or related goodwill is required at
31 December 2018.
Depreciation
Depreciation rates have been set to accurately reflect the reduction in value of property, plant and equipment
assets over their economic life, less their expected residual value. This requires judgement by the Directors, who
have set the depreciation rates as detailed in Note 2.5 to these financial statements based on their knowledge of
the industry and typically how long each asset type retains its value.
Revenue recognition
Revenue from contracts is recognised in accordance with IFRS 15. This requires judgement as revenue
transactions are subject to a variety of contract terms, albeit under the general guidelines of the accounting
policies for revenue recognition as explained in Note 2.13 to these consolidated financial statements.
4. Segment reporting
As described in Note 1 to these consolidated financial statements, the Directors consider that the Group’s internal
financial reporting is organised along product and service lines and therefore segmental information has been
presented about the Group’s business segments. The segmental analysis of the Group’s business is derived from
its principal activities, as set out below.
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0
1
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
0
2
G
O
V
E
R
N
A
N
C
E
I
0
3
F
N
A
N
C
A
L
S
I
Reportable segments
The reportable segment results for the year ended 31 December 2018 are as follows:
Product &
content sales
£’000
Tours, events,
shows, licenses &
content rental fees
£’000
Unallocated
£’000
Continuing
Total
£’000
Discontinued
activities
£’000
1,575
1,575
1,345
379
-
-
3,345
3,345
1,317
1,643
-
631
-
-
-
999
8
708
4,920
4,920
2,662
3,021
8
1,339
431
431
931
-
-
-
Total
£’000
5,351
5,351
3,593
3,021
8
1,339
(149)
(246)
(1,715)
(2,110)
(500)
(2,610)
Revenues
Total revenue
Cost of sales
Administrative
expenses
Finance costs
Exceptional items
Segment
(loss) profit
for the year
The reportable segment results for the year ended 31 December 2017 were as follows:
Product &
content sales
£’000
Tours, events,
shows, licenses &
content rental fees
£’000
Unallocated
£’000
Continuing
Total
£’000
Discontinued
activities
£’000
Revenues
Total revenue
Cost of sales
Administrative
expenses
Finance costs
Exceptional items
Segment
(loss) profit
for the year
-
-
-
-
-
-
-
1,928
1,928
826
1,193
-
-
-
-
-
300
12
5,037
4,920
4,920
2,662
3,021
8
1,339
(91)
(5,349)
(2,110)
-
-
-
-
-
-
-
Total
£’000
1,928
1,928
826
1,493
12
5,037
(5,440)
Segment assets consist primarily of property, plant and equipment, intangible assets, investments, goodwill,
trade and other receivables and cash and cash equivalents.
Unallocated assets comprise deferred taxation, financial assets held at fair value through profit or loss, and
derivatives. Segment liabilities comprise operating liabilities; liabilities such as deferred taxation are not
allocated to individual business segments.
Segment assets and liabilities as at 31 December 2018 are as follows:
Product &
Content Sales
£’000
Tours, events, shows licenses
& content rental fees
£’000
Assets
Liabilities
464
1,057
10,391
781
Segment assets and liabilities as at 31 December 2017 are as follows:
Product &
Content Sales
£’000
Tours, events, shows licenses
& content rental fees
£’000
Assets
Liabilities
-
-
7,016
4,160
Unallocated
£’000
4,356
2,746
Unallocated
£’000
-
12
Total
£’000
15,211
4,584
Total
£’000
7,016
4,172
Geographical information
The Group’s business segments operated in four principal geographical areas in the year, although they are
managed on a worldwide basis from the Group’s head office in the United Kingdom.
A geographical analysis of the Group’s revenue and non-current assets is given below. Revenue is allocated based
on the location of the customer; non-current assets are allocated based on the physical location of the asset.
Revenue
United Kingdom
Europe
USA
South America
Asia
Non-current assets
United Kingdom
Europe
USA
Asia
Unallocated
2018
£’000
637
1,064
431
107
3,112
5,351
2018
£’000
2,819
-
535
247
4,307
7,908
2017
£’000
634
440
-
-
854
1,928
2017
£’000
798
-
-
-
4,222
5,020
64
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LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
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1
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A
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E
G
C
R
E
P
O
R
T
I
0
2
G
O
V
E
R
N
A
N
C
E
I
0
3
F
N
A
N
C
A
L
S
I
Major customers
Included within revenue arising from product sales and licence fees are revenues of approximately £1,746,000
(2017: £455,000) which arose from sales to the Group’s largest customer.
5. Discontinued activities
In February 2018, Parallel Live promoted its first LEGO® LIVE event in New York, despite receiving positive reviews,
it reported a financial loss. The operation has been treated as discontinued as the Group is no longer promoting or
operating LEGO® LIVE events.
Revenue
Expenses
Attributable tax
Loss attributable to discontinued activities
6. Operating loss before exceptional items
This is stated after charging/(crediting)
Content depreciation (included within cost of sales)
Other depreciation (included within administrative expenses)
Net foreign exchange (gains)/losses
7. Exceptional items
The exceptional items consist of the following:
Impairment of associate and intangible assets
Transactional costs
Trade and other payables written back
Exceptional bad debt
David Ciclitira commission
Merchandising rights
2018
£’000
431
(931)
-
(500)
2018
£’000
346
25
(41)
2018
£’000
111
1,033
(436)
631
-
-
1,339
2017
£’000
-
-
-
-
2017
£’000
117
1
26
2017
£’000
4,582
-
-
-
355
100
5,037
2018 Exceptional items
Impairment
Brick Live Far East Limited (BLFE) is a company registered in Hong Kong which owns a 49% stake in the Brick Live
Group’s China associate company, Brick Live Centre Education Development (Beijing) Company Limited. BLFE
invested £110,837 in the associate company and as that associate company incurred losses during the year, the
Directors determined that investment should be fully impaired at 31 December 2018.
The rights to promote European Tour golf events were acquired by the Company in September 2006 and were
included in the Statement of Financial Position as intangible assets in the consolidated financial statements for
the year ended 31 December 2017 at a value of £1,000. These assets were intended to be amortised over their
expected life of 20 years. However, the remaining assets were impaired to a net book value of £nil as of
31 December 2018 to reflect the fact that the ongoing business of the Group is not expected to generate
revenues from these rights in the foreseeable future.
Transactional costs
Transaction costs relate to the strategic acquisition of Bright Bricks, completed in October 2018, and the various
fundraises completed during the year.
Exceptional bad debt
A contract was in place for a minimum contribution from a single European licence partner (the “ELP”) during the
year that covered the whole of Europe. However, the ELP was unable to provide the intended number of shows
during 2018 and as a result, the licence has since been cancelled, with the amounts accrued under the ELP
agreement being treated as a bad debt and which have therefore been written off as an exceptional item.
However, the cancellation of the licence has enabled the Group to enter into new agreements with different
partners within Europe, that would have been prohibited under the contract with the ELP, which has already
allowed the Group to partner with the best placed partners in a number of European geographies, and will also
allow it to seek further European partners going forward.
Trade and other payables write back
An agreement was entered into in October 2018 between the Company and James Golf Limited (“JGL”),
a company wholly owned by David Ciclitira, pursuant to which JGL agreed to indemnify the Company against
all costs and claims or liabilities arising from or directly related to several of the Company’s creditor balances,
releasing the Group from liabilities of, in aggregate, £436,000. As a result, this amount has been written back.
2017 Exceptional items
Impairment
As a result of the reverse acquisition treatment of the acquisition of Brick Live Group by the Company, notional
consideration was applied to the transaction which created a goodwill asset on consolidation of £4,581,166.
This goodwill asset was subject to a formal impairment review by the Directors who determined that the fair
value of the Company was £nil. As a stand-alone company, it has limited trading activities and generated no
revenue in 2017. These factors, combined, resulted in a full impairment of the goodwill at 31 December 2017.
David Ciclitira companies
Prior to the acquisition of Brick Live Group by the Company, David Ciclitira charged £355,000 of commission on
related sales made during 2017, in line with his agreement with Brick Live Group. This contractual agreement
was settled by the Company on 22 December 2017 in exchange for £1,000,000 of shares in the Company.
This commission was therefore not an ongoing cost in the Company (other than that which would normally
be released as part of the deferred revenue balance) and so was treated as exceptional in the year ended
31 December 2017.
Merchandising rights
A company controlled by Mr Hyun Seok Kim agreed to relinquish certain merchandising rights in Asia for a
consideration of £100,000, which was settled by the issue of 333,333 new Ordinary shares in the Company
in the year ended 31 December 2017.
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T
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A
T
E
G
C
R
E
P
O
R
T
I
0
2
G
O
V
E
R
N
A
N
C
E
I
0
3
F
N
A
N
C
A
L
S
I
8. Auditor’s remuneration
10. Remuneration of Directors and key management personnel
Fees payable to the auditor, Kingston Smith LLP, for the
audit of the annual accounts of the Group, the Company
and the Group subsidiaries.
Services relating to taxation
9. Employees
Group
The average number of employees (including Directors
not under employment contracts) during the year was:
Administration
Production
Sales
The aggregate payroll costs including
Directors not under employment
contracts) were:
Wages, salaries and fees
Social security costs
2018
£’000
2017
£’000
70
10
80
51
10
61
2018
(No.)
2017
(No.)
12
12
2
26
5
-
-
5
2018
£’000
2017
£’000
1,369
102
1,471
394
4
398
Bright Bricks was acquired in October 2018, therefore figures above relate to the average number of persons
employed by the Group (including Directors) during the year.
The Directors’ emoluments in 2017 referred to in this Note refer solely to the Directors of LVCG.
As such, these do not refer back to the 2017 consolidated Statement of Comprehensive Income, which constitutes
just Brick Live Group because of the reverse acquisition accounting treatment.
The Directors are the key management personnel of the Group. Directors’ remuneration and fees,
including Non-Executive Directors, during the year were as follows:
David Ciclitira
Andrew Smith
Bryan Lawrie (Appointed 17 October 2018)
Serenella Ciclitira
Ranjit Murugason
Simon Bennett (Resigned 31 August 2018)
Tracey Norris Grey (Appointed 1 November 2018)
Simon Horgan (Appointed 1 November 2018)
David Ciclitira
UK Chairman’s fees
International consultancy fees
Bonus in respect of working with international investors to
successfully complete the AIM readmission in addition to
the work done to acquire Bright Bricks
2018
£’000
503
115
36
17
195
26
3
3
898
2018
£’000
25
378
100
503
2017
£’000
191
-
-
24
185
-
-
-
400
2017
£’000
-
191
-
191
Ranjit Murugason
Remuneration for Ranjit Murugason was satisfied by the issue of new Ordinary Shares. It comprised £20,000
(2017: £150,000) in Non-Executive Director fees, (2017: £35,000) of fees for additional services provided in
respect of the development and execution of the Bright Bricks acquisition and £50,000 interim fees in respect of
completion of the integration of the acquisition of Bright Bricks and additional work undertaken in relation to the
closure of the Singapore subsidiaries to the LVCG business. This £50,000 was part of the £100,000 new Ordinary
Shares issued to Ranjit Murugason as announced on 2 April 2019.
The remaining £50,000 will be charged in the consolidated financial statements for the year ending 31 December
2019 to reflect settlement of the Non-Executive Director fees for the quarter ended 31 March 2019 and the final
work in respect of the closure of the Singapore subsidiaries.
Simon Bennett
Simon Bennett resigned 31 August 2018. His fees and expenses for Non-Executive Director services during the
year amounted to £26,000.
Andrew Smith
Andrew Smith’s remuneration was £115,000 for the year ended 31 December 2018. £11,000 was earned in
respect of his role as Chief Strategic Officer for the Company, £17,000 in his role as Executive Chairman of Bright
Bricks Limited and £87,000 in his role as Managing Director of Brick Live International Limited.
All the Directors are covered by Group’s Directors’ liability insurance policy.
The Directors’ emoluments in 2017 referred to in this note refer solely to the Directors of LVCG. As such, these do
not refer back to the 2017 Consolidated Statement of Comprehensive Income (which constitutes just Brick Live
Group because of the reverse acquisition accounting treatment); however, the remuneration of all Group directors
has been provided for transparency.
Further information on related party disclosures is set out in Note 31.
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1
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
0
2
G
O
V
E
R
N
A
N
C
E
I
0
3
F
N
A
N
C
A
L
S
I
11. Finance costs
Bank interest
Loan interest
12. Tax
UK Corporation tax in respect of current year:
Current taxation
Total tax charge for the year
Loss on Ordinary activities before tax
Loss on Ordinary activities at the standard rate of
corporation tax of 19% (2017: 19%)
Effect of:
Tax losses carried forward
Total tax charge for the year
2018
£’000
-
8
8
2018
£’000
-
-
(2,610)
2017
£’000
12
-
12
2017
£’000
-
-
(5,440)
(496)
(1,034)
496
-
1,034
-
13. Earnings per share
The basic earnings per share is calculated by dividing the (loss)/profit attributable to equity shareholders by
the weighted average number of shares in issue during the year. In calculating the diluted earnings per share,
any outstanding share options, warrants and convertible loans are taken into account where the impact of
these is dilutive.
Loss for the year after tax
Loss for the year on continuing operations
Loss for the year on discontinuing operations
2018
£’000
(2,610)
(2,110)
(500)
2017
£’000
(5,440)
(5,440)
-
Weighted average number of shares in issue
55,560,444
48,207,793
Basic and diluted earnings per share on total operations*
Basic and diluted earnings per share on continuing operations*
Basic and diluted earnings per share on discontinuing operations*
(4.7p)
(3.8p)
(0.9p)
(11.0p)
(11.0p)
-
*Diluted earnings per share in both 2018 and 2017 are the same as basic earnings per share, as there are no
dilutive options in issue during these years.
14. Property, plant and equipment
Group
Cost
Cost at start of year
Additions for year
Acquisition of subsidiary
Reclassification of bricks to inventories
Cost at end of year
Depreciation
Cumulative depreciation at start of year
Charge for year
Cumulative depreciation on brick
inventories reclassification
Cumulative depreciation at end of year
Net book value at end of year
Net book value at start of year
2018
£’000
920
988
2,668
(623)
3,953
122
365
(85)
402
3,551
798
2017
£’000
182
738
-
-
920
4
-
118
122
798
178
Company
2018
£’000
2017
£’000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
The majority of the 2017 and 2018 additions relate to content in the form of themed tour assets for long term use
within the Group’s business.
15. Intangible assets
Cost
Cost at start of year
Deemed acquisitions as a result of
reverse acquisition accounting
Additions in the year
Cost at end of year
Amortisation and impairment
Cumulative amortisation at
start of year
Cumulative amortisation on
acquisitions as a result of reverse
acquisition accounting
Impairment and amortisation during
the year
Net book value at end of year
Net book value at start of year
Group
Company
Trademarks
Tournament rights
Trademarks
Tournament rights
2018
£’000
2017
£’000
2018
£’000
2017
£’000
2018
£’000
2017
£’000
2018
£’000
2017
£’000
-
-
55
55
-
-
5
5
50
-
-
-
-
-
2,713
-
-
-
2,713
2,713
-
2,713
-
2,712
-
-
-
-
-
-
-
2,712
1
2,713
-
1
-
2,712
1
1
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2,713
-
-
-
2,713
2,713
-
2,713
-
2,712
-
-
-
-
-
-
-
2,712
1
2,713
-
1
-
2,712
1
-
70
71
LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
Trademarks
Trademarks are obtained for each show in each jurisdiction around the world. Trademarks are amortised over their
estimated useful lives, which is on average 10 years.
Tournament rights
Tournament rights are the rights to promote European Tour golf events acquired in September 2006.
These intangible assets are carried at cost less amortisation. Amortisation was initially calculated to write
off the assets over their expected useful life of 20 years however, the Directors undertook an impairment
review regarding the value of the Tournament rights in 2018 which resulted in a write down to £nil to reflect
the fact that the ongoing business of the Group is not expected to generate revenues from these rights in the
foreseeable future.
16. Investments
Cost
Cost at start of year
Additions in the year
Cost at end of year
Impairment
At start of year
Impairment in the year
At end of year
Net book value at end of year
Net book value at start of year
Group
Company
2018
£’000
2017
£’000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2018
£’000
8,950
8,500
17,450
-
-
-
2017
£’000
-
8,950
8,950
-
-
-
8,950
-
The carrying value of investments are in respect of Brick Live Group £5,000,000 (2017: £5,000,000),
Parallel Live Group £1,000,000, Brick Live Far East Limited £2,950,000 (2017: £2,950,000) and
Bright Bricks £8,500,000 (2017: £nil).
17. Goodwill
Cost
Cost at start of year
Additions in the year
Cost at end of year
Impairment
At start of year
Impairment in the year
At end of year
Net book value at end of year
Net book value at start of year
2018
£’000
8,802
86
8,888
4,581
-
4,581
4,307
4,221
Group
2017
£’000
-
8,802
8,802
-
4,581
4,581
4,221
-
Company
2018
£’000
2017
£’000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
In 2017, £4,581,000 goodwill was created on the reverse acquisition of LVCG by Brick Live Group, as detailed
in Note 2.1 to these consolidated financial statements. The goodwill was fully impaired in the year ended
31 December 2017.
In 2017, the Group acquired Parallel Live Group, resulting in goodwill of £1,271,000, and £2,950,000 for
the acquisition by LVCG of the remaining shares in BLFE not already owned by Brick Live Group.
0
1
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
0
2
G
O
V
E
R
N
A
N
C
E
I
0
3
F
N
A
N
C
A
L
S
I
The net book value of £4,307,000 (2017: £4,221,000) relates to £2,950,000 (2017: £2,950,000) for the acquisition
by LVCG of BLFE, £1,271,000 (2017: £1,271,000) for the acquisition of Parallel Live and £86,000 (2017: £nil) for
the acquisition of Bright Bricks. A formal impairment review has been carried out on these carrying values and the
Directors have determined that that no impairment of goodwill is required at 31 December 2018. This is explained
further in Note 3.
17,450
8,950
In 2018, the £86,000 of goodwill was created on the acquisition of Bright Bricks as detailed in Note 28.
72
73
LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
0
1
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
0
2
G
O
V
E
R
N
A
N
C
E
I
0
3
F
N
A
N
C
A
L
S
I
18. Investments in Associates and Joint Ventures
21. Cash and cash equivalents
In July 2017, BLFE entered into a long-term agreement with Fortune Access, to create a limited liability
foreign enterprise company in China called BRICKLIVE China. BLFE agreed to invest 980,000 RMB (approximately
£112,000) for a 49 % shareholding in BRICKLIVE China. At the year end, £110,000 had been invested by BLFE
in the associate.
The results of the Associate to the year are:
Turnover
Loss before tax
Taxation
Loss after tax
2018
£’000
2,554
(251)
-
(251)
2017
£’000
-
(64)
-
(64)
Cash at bank
22. Borrowings
On the basis of the above performance, the investment in the associate company was impaired to £nil at
31 December 2018. This impairment has been disclosed as an exceptional item as detailed in Note 7.
Loan
Group
Company
2017
£’000
871
2018
£’000
2
Group
Company
2017
£’000
-
2018
£’000
1,000
2018
£’000
120
2018
£’000
1,000
2017
£’000
842
2017
£’000
-
In September 2018, Parallel Live Group signed a joint venture agreement with US-based Company Three Six Zero,
forming the new company Parallel Three Six Zero Inc. It has been granted exclusive rights by Parallel Live Group
to promote BRICKLIVE events in North America and Canada with Brick Live International Limited as its
content provider.
Trading in the joint venture commenced in January 2019.
19. Inventories
Inventories of bricks
Group
Company
2018
£’000
6,491
2017
£’000
-
2018
£’000
-
2017
£’000
-
Inventories include bricks reclassified from property, plant and equipment as detailed in Note 14.
20. Trade and other receivables
Trade receivables
Amounts owed by subsidiaries
Other receivables
Prepayments and accrued income
Group
Company
2018
£’000
512
-
77
103
692
2017
£’000
359
-
209
557
1,125
2018
£’000
2,500
-
10
2,510
2017
£’000
-
143
76
-
219
At 31 December 2018 all amounts included under trade and other receivables are due within one year.
The Group has not recognised an allowance against trade receivables as there has not been a significant
change in credit quality.
Amounts owed by subsidiaries are considered interest free and repayable on demand.
The loan was drawn down in full during Q4 2018, has a one-year term and interest is charged at a flat rate of
9% per annum on the amount advanced.
The loan may be extended, by mutual agreement, for a further six months on similar terms. Additionally, the
Company may make early repayment of the full facility together with the full annual interest premium.
A further update is contained within the post balance sheet events Note 34.
23. Trade and other payables
Trade payables
Amounts owed to subsidiaries
Other payables
Other taxation and social security
Accruals and deferred income
Group
Company
2018
£’000
1,134
-
1,132
346
849
3,461
2017
£’000
2,172
-
385
-
1,603
4,160
2018
£’000
514
40
965
-
144
1,663
2017
£’000
1,112
6
353
-
174
1,645
Amounts owed to subsidiaries are unsecured, interest free and repayable on demand.
24. Financial risks
The Group and Company operations expose them to a number of financial risks. The Directors aim to protect the
Group and Company against the potential adverse effects of these financial risks.
Financial assets
Financial assets include cash and trade and other receivables (excluding prepayments) which are classified as
“loans and receivables”; and equity investments (excluding investments in subsidiaries and associate investments).
These amounts, where appropriate, have been shown separately on the face of the statement of financial position.
Funds not immediately required for the Group and Company’s operations are invested in bank deposits. It is the
Directors’ opinion that the carrying values of cash, trade receivables and investments approximate to their
fair values.
74
75
LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
Financial liabilities
Financial liabilities include current and non-current borrowings, convertible loans and trade and other payables
(excluding: taxation and social security, and deferred income). All amounts are carried at amortised cost.
These amounts have been disclosed in the Notes to the financial statements. It is the Directors’ opinion that
the carrying values of financial liabilities approximate to their fair-value.
Liquidity risk
The Group and Company’s surplus liquid resources are maintained on short-term interest-bearing deposits.
The Group and Company plans to continue to meet operating and other loan commitments as they fall due.
Liquidity risk is managed through cash flow forecasts and regular planning.
Set out below are liquidity risk comparative tables as at 31 December 2018 and 31 December 2017.
Credit Risk
Financial assets past due but not impaired as at 31 December 2018:
Group: Trade and other receivables
Company: Trade and other receivables
Not impaired
and not due
Not impaired but past due
by the following amounts
£’000
589
-
>30 days
£’000
-
-
>60 days
£’000
>90 days
£’000
>120 days
£’000
-
-
-
-
-
-
0
1
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
0
2
G
O
V
E
R
N
A
N
C
E
I
0
3
F
N
A
N
C
A
L
S
I
Remaining contractual maturities year ended 31 December 2018
Financial assets past due but not impaired as at 31 December 2017:
Group
Bank loans and borrowings
Trade and other payables
Company
Bank loans and borrowings
Trade and other payables
Within
3 Months
£’000
-
1,687
1,687
Within
3 Months
£’000
-
825
825
>3 months
< 1 year
£’000
> one year
< 5 years
£’000
Total carrying
amount
£’000
1,000
833
1,833
-
-
-
1,000
2,520
3,520
>3 months
< 1 year
£’000
> one year
< 5 years
£’000
Total carrying
amount
£’000
1,000
833
1,833
-
-
-
1,000
1,658
2,658
Remaining contractual maturities year ended 31 December 2017
Group
Bank loans and borrowings
Trade and other payables
Company
Bank loans and borrowings
Trade and other payables
Within
3 Months
£’000
-
3,033
3,033
Within
3 Months
£’000
-
1,645
1,645
>3 months
< 1 year
£’000
> one year
< 5 years
£’000
Total carrying
amount
£’000
-
-
-
-
-
-
-
3,033
3,033
>3 months
< 1 year
£’000
> one year
< 5 years
£’000
Total carrying
amount
£’000
-
-
-
-
-
-
-
1,645
1,645
The trade and other payables figures above exclude taxation and deferred income.
Group: Trade and other receivables
Company: Trade and other receivables
Not impaired
and not due
Not impaired but past due
by the following amounts
£’000
489
219
>30 days
£’000
24
-
>60 days
£’000
>90 days
£’000
>120 days
£’000
-
-
-
-
55
-
The trade and other receivables figures above exclude prepayments and accrued income.
Group trade and other receivables excluding prepayments and accrued income as at 31 December 2018 were
£589,000 (2017: £568,000), all of which are not impaired. All remaining trade and other receivables as at
31 December 2018 are collected and/or collectable and are considered of low credit risk. All bank deposits
are maintained in the United Kingdom and are low credit risk.
Market risk
(a) Interest rate risk
The Group had one loan at the year end (2017: None). The interest rate is fixed and the loan repayable within one
year. This risk is therefore considered to be insignificant.
(b) Foreign currency risk
Although the Company is based in the United Kingdom a significant part of the Group’s and Company’s operations
are overseas, and the operating or functional currency of a large part of the Asian business is in US Dollars or
Euros. As a result, the Group’s sterling accounts can be affected by movements in the US Dollar/Sterling and
the Euro/Sterling exchange rates.
The foreign assets and liabilities of the Group and Company are closely matched as at 31 December 2018.
The table on the next page sets out the carrying amounts of assets and liabilities for the Group in their
presentational currency (i.e. Sterling) and a total impact for each 10% fluctuation in exchange rates.
Based on the carrying amounts of foreign assets and liabilities as at 31 December 2018, for each 10% fluctuation
in exchange rates, net assets are expected to be impacted by £30,000 (2017: £177,000).
76
77
LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
Year ended 31 December 2018
Carrying amount (sterling equivalent)
Financial assets
Cash
Trade receivables
Total financial assets
Financial liabilities
Borrowings
Trade payables
Other payables
Other taxation and social security
Accruals and deferred income
Total financial liabilities
Net Impact
£
‘000
61
229
290
1,000
826
1,132
346
521
3,825
$
‘000
36
260
296
-
267
-
-
328
595
Year ended 31 December 2017
Carrying amount (sterling equivalent)
Financial assets
Cash
Trade receivables
Total financial assets
£
‘000
871
-
871
$
‘000
‘000
-
359
359
Financial liabilities
Borrowings
Trade payables
Other payables
Other taxation and social security
Accruals and deferred income
Total financial liabilities
-
1,067
359
26
576
2,028
-
1,018
-
-
1,027
2,045
€
‘000
HK$
‘000
Carrying
Amount
‘000
KRW
‘000
Forex Risk
(-10%)
‘000
23
23
46
-
41
-
-
-
41
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
120
512
632
1,000
1,134
1,132
346
849
4,461
6
28
34
-
(31)
-
-
(33)
(64)
10%
‘000
(6)
(28)
(34)
-
31
-
-
33
64
30
(30)
€
‘000
HK$
‘000
Carrying
Amount
‘000
KRW
‘000
Forex Risk
(-10%)
‘000
-
-
-
-
24
-
-
-
24
-
-
-
-
1
-
-
-
1
-
-
-
-
62
-
-
-
62
871
359
1,230
-
2,172
359
26
1,603
4,160
-
36
36
-
(110)
-
-
(103)
(213)
10%
‘000
-
(36)
(36)
-
110
-
-
103
213
Net Impact
(177)
177
25. Deferred tax
The Group carries a net deferred tax liability at 31 December 2018 of £86,000 (2017: asset of £10,000).
The £123,000 (2017: £12,000) deferred tax liability shown in the consolidated Statement of Financial Position
is set off by a £37,000 (2017: £22,000) asset included in other receivables. Due to the availability of UK tax losses,
subject to agreement with the HMRC, there is an estimated deferred tax asset of £4,461,000 (2017: £4,344,000).
This is not recognised due to the uncertainty of the timing of future taxable profits against which these losses
could be utilised.
There were no deductible temporary differences or unused tax credits at either 31 December 2018 or
31 December 2017. There were no amounts of deferred tax recognised in the Statement of Comprehensive
Income for either the year ended 31 December 2018 or for the year ended 31 December 2017.
0
1
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
0
2
G
O
V
E
R
N
A
N
C
E
I
0
3
F
N
A
N
C
A
L
S
I
26. Share capital
The issued share capital is set out in the table below:
Issued and fully paid
Ordinary shares of 1p
Deferred shares of 51.8p
Deferred Ordinary shares of 0.5p
Deferred B shares of £19.60
Total
2018
2017
No. of shares
£’000
No. of shares
£’000
67,094,595
2,047,523
199,831,545
103,260
671
1,060
999
2,024
4,754
48,207,793
2,047,523
199,831,545
103,260
482
1,061
999
2,024
4,566
The only changes in the year were to Ordinary 1p shares, relating to the various capital transactions during
the year. The table below summarises the changes:
Share Capital
2018
2017
No. of shares
£’000
No. of shares
£’000
Ordinary shares of 1p
At start of year
Consideration for acquisition of Brick Live Group
Consideration for acquisition of Parallel Live Group
Consideration for acquisition of BLFE
Consideration for acquisition of Bright Bricks
Share placing December 2017
Share placing January 2018
Share placing April 2018
Share placing October 2018
Capitalisation of David Ciclitira loans
Capitalisation of Ranjit Murugason
outstanding fees
Capitalisation of consultant fees
Capitalisation of Simon Bennett
outstanding fees
Purchase of David Ciclitira commission contract
Merchandising rights
48,207,793
-
-
-
8,461,536
-
4,571,425
1,000,000
4,615,381
-
192,307
46,153
-
-
-
482
85
46
10
46
-
2
-
-
-
-
3,009,233
16,666,667
3,333,333
9,832,060
-
4,200,000
-
-
-
6,766,667
616,500
-
116,667
3,333,333
333,333
30
167
33
98
-
42
-
-
-
68
6
-
1
34
3
At end of year
67,094,595
671
48,207,793
482
78
79
LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
0
1
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
0
2
G
O
V
E
R
N
A
N
C
E
I
0
3
F
N
A
N
C
A
L
S
I
Deferred shares
The Company has 2,047,523 Deferred shares of 51.8p each and 199,831,545 Deferred Ordinary shares of 0.5p
each (together the “Deferred shares”) in issue. The Company also has 103,260 Deferred B shares in issue.
The Deferred shares have the following rights and restrictions. They shall:
a. Not entitle their holders to receive any dividend or other distribution;
b. Not entitle their holders to receive notice of or to attend, speak or vote at any General Meeting of the Company
by virtue of or in respect of their holding of such Deferred shares and;
c. Entitle their holders on a return of assets on a winding-up of the Company or otherwise only to the repayment
of the capital paid up on such Deferred shares and only after repayment of the capital paid up on each Ordinary
share in the capital of the Company and the payment of a further £100,000 on each such Ordinary share.
The holders of the Deferred shares shall not be entitled to any further participation in the assets or profits of the
Company. Notwithstanding any other provision of these Articles and unless specifically required by the provisions
of the Act, the Company shall not be required to issue any certificates in respect of the Deferred shares.
The Company shall have irrevocable authority at any time:
a. To appoint a person on behalf of any holder of Deferred shares to enter into an agreement to transfer, and to
execute a transfer of, the Deferred shares, for no consideration, to such person (whether or not an officer of the
Company) as the Directors may determine as the custodian thereof;
b. To purchase all the Deferred shares then in issue in consideration of an aggregate payment of one penny for
all of such shares then redeemed and upon giving 28 days’ prior notice to the holders of Deferred shares as to
be redeemed fixing a time and place for redemption; and
c. In the event of any transfer, purchase or redemption to retain any share certificate relating to such shares.
If any Deferred shares are purchased or redeemed as aforesaid, the relevant amount of authorised but unissued
share capital arising may be redesignated by the Directors as Ordinary share capital.
Neither the passing by the Company of any special resolution for the cancellation of the Deferred shares for no
consideration by means of a reduction of capital requiring the confirmation of the Court nor the obtaining by the
Company nor the making by the Court of any Order confirming any such 103 reduction of capital nor the becoming
effective of any such Order shall constitute a variation, modification or abrogation of the rights attaching to the
Deferred shares and accordingly the Deferred shares may at any time be cancelled for no consideration by means
of a reduction of capital effected in accordance with the Act without sanction or consent on the part of the holders
of the Deferred shares.
27. Share premium
At start of year
Premium arising on issue of equity shares
Debt to share conversion
Share issue costs
At end of year
2018
£’000
13,695
4,848
153
(226)
18,740
2017
£’000
9,239
4,456
-
-
13,695
28. Acquisitions
The Company purchased the whole share capital of Bright Bricks Holdings Limited in October 2018, the asset
values of which were as follows:
Book value of
assets acquired
£’000
Fair value
adjustments
£’000
Fair Value of
assets acquired
£’000
Tangible assets
Stock of bricks
Cash and cash equivalents
Other assets and liabilities
Goodwill
Total consideration
Satisfied by:
Cash
Deferred consideration
Equity instruments (8,461,536 Ordinary
shares of parent Company)
1,488
882
43
(176)
-
2,237
1,180
4,997
-
-
-
6,117
2,668
5,879
43
(176)
86
8,500
2,167
833
5,500
8,500
29. Share based payments
There were no share options outstanding at 31 December 2018 (2017 - nil) and therefore there was no weighted
average exercise price (2017 - nil). No options were exercised during the year. A share option scheme was
adopted on 2 April 2019.
Share warrants
On 17 October 2018, in accordance with the loan agreement, the Company issued to the lender, 356,923 warrants
to subscribe for Ordinary shares. The warrants have an exercise price of 81.25p per share and may be exercised for
a period of three years from issue.
Share based payments measured directly
During the year ended 31 December 2018 no share-based payments were granted (2017: £nil).
30. Capital management
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern,
so that it can continue to provide returns to shareholders and benefits for other stakeholders. The Group had net
assets of £10,627,000 at 31 December 2018 (2017: £2,844,000). The Group’s capital management strategy is to
retain sufficient working capital for day to day operating requirements and to ensure sufficient funding is available
to meet commitments as they fall due and to support growth.
Bank facility
Total Debt
Cash
Net Debt
31 December
2018
£’000
31 December
2017
£’000
1,000
1,000
(120)
880
-
-
(871)
(871)
In order to maintain or adjust the capital structure the Group may issue new shares or sell assets to reduce debt.
80
81
LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
0
1
S
T
R
A
T
E
G
C
R
E
P
O
R
T
I
0
2
G
O
V
E
R
N
A
N
C
E
I
0
3
F
N
A
N
C
A
L
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31. Related parties
Details of the Directors’ remuneration and consultancy fees are disclosed in Note 10 and share options granted
to Directors are disclosed in the Directors Report. In the opinion of the Board, only the Directors of the parent
Company and the other members of the Executive Board, as detailed in the Corporate Governance Report,
are regarded as key management personnel. The remuneration of key management personnel during the
year was £899,000.
David Ciclitira
In addition to the above, David Ciclitira received further payments during the relevant periods as set out below:
Live Company Group plc
The Group entered into certain arrangements with David Ciclitira, pursuant to which he receives a rental fee of
£3,000 per month plus reasonable expenses for the use of his London, UK property, as an ad-hoc office for the
Group when required, together with certain fees whenever members of the Group stay at his overseas properties
on business (together the “Rental Arrangements”). The Company would note that the Group has no London
offices. The Rental Arrangements commenced in January 2018 following completion of the acquisitions in
December 2017 and in respect of the year ended 31 December 2018, the Group paid David Ciclitira a fee of,
in aggregate, £55,000 under the Rental Arrangements.
In addition to the above David Ciclitira made certain payments on behalf of the Group in July, August and October
2018 amounting to, in aggregate, approximately £218,000 (the “Payments”), (2017: £60,000) which were then
repaid to Mr Ciclitira. In respect of the Payments, the Company paid Mr Ciclitira an arrangement fee equal to
7% of the Payments, being approximately £15,000 and interest was charged at a rate of 9% per annum on the
outstanding balances, amounting to £5,000. (2017: £nil)
David Ciclitira also made various other payments on behalf of the Group in December 2018 (£24,000) and January
2019 (£102,000) for, in aggregate, £126,000 (the “Further Payments”) to various counterparties. No arrangement
fee or interest is due on the Further Payments and they have been repaid in full.
Furthermore, an agreement was entered into in October 2018 between the Company and James Golf Limited
(“JGL”), a company wholly owned by David Ciclitira, pursuant to which JGL agreed to indemnify the Company
against all costs and claims or liabilities arising from or directly related to several of the Company’s creditor
balances, releasing the Group from liabilities of, in aggregate, £436,000.
Other payments made included:
• business expenses and healthcare costs of £23,000 (2017 - £58,000)
• £nil (2017: £53,000) of amounts invoiced by Parallel Contemporary Arts, a company wholly owned by David Ciclitira
• £nil (2017: £1,000,000) in respect of settling his ongoing commission arrangement with Brick Live Group
• £nil (2017: £70,000) provision has been made in the Company balance sheet for a contribution towards the
costs of liquidating the subsidiary companies sold to James Golf Limited on 22 December 2017
• £nil (2017: £89,000) repayment of interest incurred in relation to Company loans
• £nil (2017: £43,000) of sponsorship of START (a business venture owned by David Ciclitira).
Brick Live Group Limited
As at 31 December 2017, £30,000 of commission was awarded to David Ciclitira and included in deferred
expenses. During 2018, that commission was released to the Statement of Comprehensive Income of
Brick Live Group.
During the year ended 31 December 2017, David Ciclitira’s commission in Brick Live Group was £355,000
together with further expenses of £46,000. A total of £401,000.
Brick Live International Limited
As at 31 December 2017 £212,500 of commission was awarded to David Ciclitira and included in deferred
expenses. During 2018, that commission was released to the Statement of Comprehensive Income of
Brick Live International Limited.
Therefore, total amounts paid to David Ciclitira for the year ended 31 December 2018 for the whole Group
were £863,000 (2017: £1,965,000).
Total amounts owed to David Ciclitira and entities under his control at 31 December 2018 were £nil
(2017: £355,000).
82
Ranjit Murugason
As at 31 December 2018 a balance of £50,000 (2017: £10,000) was owed to Ranjit Murugason.
Bryan Lawrie
Bryan Lawrie was appointed CFO of the Company on 17 October 2018. He received fees of £54,000 for services
provided to the Group prior to being appointed a Director. £20,000 was in respect of services provided in relation
to the acquisition of Bright Bricks and a further £34,000 of fees owed for accounting services provided to the
Group for the period from 1 June to 16 October 2018.
As at 31 December 2018 a total of £9,000 was owed to Bryan Lawrie.
Serenella Ciclitira
As at 31 December 2018 Serenella Ciclitira was owed £43,000 in respect of Non-Executive Director fees for 2018
and previous years which have not yet been paid.
Andrew Smith
As at 31 December 2018 no amounts were owed to Andrew Smith.
Simon Horgan
As at 31 December 2018 Simon Horgan was owed £3,333 in respect of Non-Executive Director fees not yet paid.
As part of the acquisition of Bright Bricks, Simon Horgan received cash consideration of £833,333 and equity
consideration of 3,076,922 Ordinary 1p shares in the Company. A further £166,667 of deferred consideration is
due in October 2019. This can be taken in either shares or cash at Simon Horgan’s request.
Trudy Norris-Grey
As at 31 December 2018, Trudy Norris-Grey was owed £3,333 in respect of Non-Executive Director fees not yet paid.
None of the above balances owed are secured, and no expense has been recognised in the current year or prior
year for bad or doubtful debts in respect of any amounts owed by related parties.
32. Operating Leases
Operating leases relate to leases of property. The Group does not have an option to purchase the leased property
at the expiry of the lease period.
Payments recognised as an expense
Minimum lease payments
Non-cancellable operating lease commitments
Not later than 1 year
Later than 1 year and not later than 5 years
Later than 5 years
2018
£’000
37
2018
£’000
83
90
-
173
2017
£’000
-
2017
£’000
-
-
-
-
83
LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
0
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A
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E
P
O
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2
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3
F
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33. Subsidiaries
34. Post balance sheet events
At 31 December 2018, the Company had the following (direct and indirect) subsidiaries:
Held directly
Brick Live Group Limited
Brick Live Touring Limited
Parallel Live Group Limited
Championship (Singapore) Pte Limited
Parallel Media Group Asia
Bright Bricks Holdings Limited
Bright Bricks Worldwide Limited
Company
number
10151705
11253539
09932658
201427355K
201131009R
11052288
11544812
Place of
incorporation
UK
UK
UK
Singapore
Singapore
UK
UK
%
owned
100%
100%
100%
95%
100%
100%
100%
Principal activities
Holding Company
Touring events in Asia
Holding Company
Dormant
Dormant
Holding Company
Dormant
Held indirectly
Brick Live International Limited
Brick Live Far East Limited
Brick Live Hong Limited
Brick Live Education Limited
Brick Live Far East Limited
10257756
UK
100%
10308158
2460469
11143327
2460460
UK
Hong Kong
UK
Hong Kong
100%
100%
100%
100%
Parallel Live (NY) Limited
Parallel Live (NY) LLC
10790554
6339763
UK
USA
100%
100%
Bright Bricks Limited
Bright Bricks Consumer Limited
Bright Bricks Events Limited
Bright Bricks Parties Limited
07227540
10653625
10535457
10837360
UK
UK
UK
UK
100%
100%
100%
100%
Sales of products,
licensed events and zoos
Dormant
Dormant
Dormant
Owner of Associate
investment in
China venture
Dormant
Formerly self-promoted
events in USA but now
dormant
Specialist production
company
Dormant Jan 2019
Dormant
Dormant
No subsidiaries were disposed of in 2018. The subsidiaries disposed of in 2017 were as follows:
Held directly
Causeway Trophy PTE Limited
Parallel Media Italia SRL
Parallel Media (Jersey) Ltd
Parallel Media (Americas) Ltd
Parallel Media Hong Kong) Ltd
Parallel Media Korea (New Media) Ltd
Held indirectly
Parallel Media Europe Ltd
Parallel Smart Media UK Ltd
PGAA Media Ltd
Parallel Smart Media Ltd
Parallel Media Americas Inc
Parallel Media Group International Ltd
84
Place of
incorporation
Singapore
Italy
Jersey
BVI
Hong Kong
UK
UK
UK
BVI
UK
US
Jersey
%
owned
50%
100%
100%
100%
100%
100%
100%
100%
83.9%
100%
100%
100%
Principal activities
Dormant
Dormant
Dormant
Dormant
Dormant
Dormant
Dormant
Dormant
Dormant
Dormant
Dormant
Dormant
Equity fund raise
On 25 February 2019, the Company announced an equity fundraise with certain existing investors including
David Ciclitira, the Company’s Executive Chairman, of, in aggregate, £2.2 million gross (approximately £2.1 million
net of fees).
Net proceeds of the fundraise will be used to:
• Finance the further expansion of the BRICKLIVE Zoo programme;
• Provide additional working capital to the Group.
The Fundraise comprised a placing of 2,084,616 new Ordinary Shares to raise £1.36 million gross and a
subscription of 1,299,996 new Ordinary Shares to raise £0.84 million gross, both at a price of 65 pence per share.
As at the date of this report, £0.2 million under the subscription is still to be received.
The Company also issued participants in the fundraise 1.25 warrants for every new Ordinary Share issued. Each
warrant provides the holder the right to one new Ordinary Share on its exercise. The warrants will be exercisable
at a price of 80 pence for a two-year period from the admission of the relevant new Ordinary Shares.
Loan funding
On 17 October 2018 the Company secured a £1,000,000 loan facility arranged by Riverfort Global Capital Limited.
The Company drew down on the loan facility during the course of Q4 2018 and in May 2019, the Company agreed
a revised repayment profile, with which it is in full compliance.
Share Option scheme
In October 2018, the Company announced that it planned to put in place a share option scheme of up to 10% of
the Company’s total issued share capital post-completion of the Bright Bricks acquisition and associated placing,
in order to provide a long-term incentive plan for executive Directors and staff.
On 2 April 2019, the Company announced that it had adopted a share option scheme, which includes an EMI
scheme for Group staff and unapproved schemes for Directors and consultants, pursuant to which it will issue
up to 6,709,459 options, representing 10% of the Company’s issued share capital as at completion of the Bright
Bricks acquisition and associated placing in October 2018. Under the scheme the Company granted 3,086,346
options to certain Directors and senior management accounting for 4.5% of the 10% allotment. Each option
provides the holder the right to one new Ordinary share on its exercise. The options have an exercise price of
65 pence per share and shall vest in three equal instalments of one third each on the first, second and third
anniversaries of granting. The options will be exercisable after three years from the date of grant and for
a period up to 31 March 2029, subject to any extension in accordance with the scheme, and are subject to
continued employment.
Bonus and issue of shares
On 2 April 2019 the Board agreed to issue David Ciclitira a bonus of 500,000 new Ordinary Shares subject to the
Group achieving an agreed performance target in respect of 2019, which will be settled in early 2020, based on
the Group’s management accounts for the year ended 31 December 2019.
As set out in Note 10, on 2 April 2019 the Company awarded David Ciclitira a bonus of £100,000 in respect of
2018, for working with international investors to successfully complete the AIM readmission in addition to the
work done to acquire Bright Bricks. This was charged in 2018.
On 11 February 2019, the Company agreed to pay Ranjit Murugason a fee of £45,000 in respect of his involvement
in winding up the Group’s historic subsidiaries in Singapore, which was satisfied through the issue of 69,230 new
Ordinary Shares at a price of 65 pence per share. This will be charged in 2019.
On 2 April 2019 the Company agreed to pay Ranjit Murugason a fee of £100,000 in respect of completion of
the integration of the acquisition of Bright Bricks and additional work undertaken in relation to the closure of
the Singapore subsidiaries to the LVCG business, which was satisfied through the issue of 153,846 new
Ordinary Shares at a price of 65 pence per share. As set out in Note 10, £50,000 was charged in 2018
and the remainder will be charged in 2019.
85
LIVE COMPANY GROUP PLC ANNUAL REPORT 2018LIVE COMPANY GROUP PLC ANNUAL REPORT 2018
ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2018
Registered Number 00630968