December 31, 2020

Main Event Entertainment Group Limited (MEEG) for the year ended October 31, 2020 recorded a total of $1.05 billion in revenue compared to $1.80 billion booked for the year ended October 31, 2019. Revenue for the quarter declined 77% to close the quarter at $101.84 million relative to $435 million booked for the corresponding period in 2019.

Notably the company stated, “The financial performance in the second half of the year reflects the brunt of the impact. The year offered a promising start, showing good momentum with strong revenue and profit growth carrying partially through the second quarter. The Company has since been confronting with unprecedented reductions in business activity. This has had a major impact on revenues, and in turn, net earnings for the financial year.”

Cost of sales for the year decreased 45% year over year to $564.53 million relative to $1.02 billion twelve months earlier. Gross profit for the year thus reduced 38% to $481.90 million (2019: $776.72 million). Gross profit for the quarter decreased 66% from $173.11 million reported for the year ended October 2019 to $58.61 million for the same period in 2020.

MEEG booked other operating income of $7.91 million for the financial year, 23% lower than the prior comparable year’s $10.34 million.

Total expenses fell 27% to $484.81 million from $667.05 million recorded for 2019. Of this:

• Administrative and general expenses declined 39% to $327.55 million (2019: $533.26 million).
• Depreciation expense increased 9% to $127.64 million (2019: $116.91 million).
• Selling and promotion expense fell 47% to $8.92 million relative to $16.88 million in the same period last year.
• Amortisation stood at $20.70 million (2019: nil).

Total expenses for the quarter amounted to $81.56 million, 53% lower relative to last year’s $175.19 million. “Faced with declining revenues, we took quick and effective actions to ease the impact to our cash flows and profitability. We moved aggressively to reduce operating costs, with all cost categories under continuous review.” As per MEEG.

MEEG operating profit for the year fell 96% to $5.01 million (2019: $120.01 million). For the quarter, the Company booked operating loss of $15.57 million versus operating loss of $5.89 million recorded in the previous corresponding period.

Finance cost year over year, increased by approximately 22% to $23.47 million (2019: $19.30 million).

Consequently, MEEG recorded loss before taxation of $18.47 million, relative a profit of $100.71 million reported for last year’s corresponding period.

The company reported taxation credit of $238,000 (2019: tax charge $3.37 million) during the year, resulting in net loss totalling $18.23 million compared to a net profit of $97.34 million booked last year. MEEG reported net loss of $26.90 million for the fourth quarter versus a net loss of $10.76 million for the comparable period in 2019.

Loss per Share (LPS) for the year amounted to $0.061 relative to an earnings per share of $0.324 booked at the end of 2019. While for the quarter the company booked a loss per share of $0.090 relative to a loss per share of $0.036 in 2019. The number of shares used in the calculation was 300,005,000 units. MEEG closed the trading period on December 30, 2020, at a price of $3.39.

Balance Sheet Highlights:

As at October 31, 2020, the company’s assets totalled $854.12 million (2019: $1.03 billion), $175.57 million less than its value a year ago. This decrease in total assets was largely driven by a decrease in ‘Receivables’ which declined $198.83 million to close at $69.11 million relative to $267.94 million in 2019.

Equity attributable to stockholders of the company amounted to $533.61 million (2019: $578.84 million). This translated to a book value per share of $1.78 relative to $1.93 for the corresponding period in 2019.

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