Works Media Group sees significantly improved outlook as trading resumes on AIM

The Works Media Group (AIM: WKS) expects a significantly improved outlook in the future following a tighter strategic focus, annualised cost savings of £500,000 and the receipt of £400,000 in newly raised capital.  The company believes the business now has a strong platform going forward. Works Media has appointed Astaire Securities as its new nominated adviser and its shares resuming trading on London's AIM market following their suspension on 4 January.

Following the completion of a strategic review, the company has decided to focus on its core UK film distribution and international rights businesses. Works Media intends to build on its DVD partnership with Universal Pictures, with seven films already identified for release in the coming year. The company said its international division plans to capitalise on the performance of recent titles 'Io Sono l'Amore' and 'The Cove'.

In order to reduce costs in line with current business levels the company has made some redundancies. As part of these measures, the Works Media board was restructured while the company was suspended from AIM. The chief executive officer and finance director, Norman Humphrey stepped down from the board and left the company. According to Works Media, the changes were in response to the difficult economic conditions and the reduced scale of operations going forward. The CEO and FD roles will be absorbed by chairman Costa Theo and other members of the board and group staff.

Through loan facilities and the issue of equity the company directors have raised an additional £400,000 to support the company under its newly re-focused operations. Theo's privately owned and controlled Milcoz Films has agreed to increase its existing convertible loan facility by £300,000 to £1.05 million, whilst long standing non-executive director Domenico Procacci has subscribed for 25 million new shares at 0.4p per share, raising £100,000. The new shares offered to Procacci represent 16.9% of the current issued ordinary share capital.

Under the terms of the Milcoz Films convertible loan, Theo has the right to convert some or all of the principal into ordinary shares, subject to Theo's holding not exceeding 29.9% of the companys issued share capital. Following Procacci's subscription, the director now holds 22.81% and Theo owns 25.57% of the company's enlarged share capital.  http://www.proactiveinvestors.co.uk/companies/news/12833/works-media-group-sees-significantly-improved-outlook-as-trading-resumes-on-aim-12833.html