Final Results

Company well positioned for sustained growth

Time Out Group plc (AIM: TMO), the global media and hospitality business, today announces its audited full year results for the twelve months ended 30 June 2023.

Financial highlights

• Gross revenue grew by 43% to £104.6m (2022: £72.9m) and net revenue(1) by 37% to £76.0m (2022: £55.4m)
• Gross profit increased 39% to £61.9m (2022: £44.6m) with gross margins +1% points
• Group adjusted EBITDA(2) up 336% to £5.3m (2022: £1.2m) with both Media and Markets delivering positive adjusted EBITDA
• Group operating loss of £17.5m (2022: £14.1m loss), £3m year-on-year movement comprising +£4.2m improvement in EBITDA less £7.7m increase in exceptional costs to £10.0m, of which £7.8m are non cash
• Cash of £5.1m at 30 June 2023 (2022: £4.8m) and borrowings of £29.9m (2022: £22.0m), resulted in adjusted net debt(3) of £24.8m (2022: £17.1m). Reported net debt was £49.7m (2022: £44.5m) including £24.9m (2022: £27.4m) of IFRS 16 lease liabilities
• Refinancing completed in November 2022; settled existing Incus loan facility with new four-year €35m facility with Crestline, repayable November 2026, of which €29.2m was drawn as at 30 June 2023; in addition, the Company today announces the extension of the Loan Note with Oakley Capital Investments, £5.2m, now repayable June 2025

Operational highlights

• Time Out Market: strong revenue growth and expanding global footprint

o Gross revenue growth of +54% YoY and net revenue growth of 48% to £42.8m (2022: £28.9m)

o Adjusted EBITDA up significantly to £4.3m (2022: £2.2m) and adjusted EBITDA margin increasing by 94 basis points as a result of increasing footfall and ongoing operational improvements

o Growing portfolio of 15 Markets includes six open and nine contracted sites set to open 2023-2027 with Cape Town, Vancouver, Riyadh, Barcelona and Bahrain signed in the year and a pipeline of new Management Agreements in advanced negotiations on the back of continued interest from real estate developers

o Exit from Miami Market in June 2023 (opened 2019) to focus on profitable locations, Miami trading loss of (£2.7m) in FY23 with exceptional costs of £7.1m comprising £6.7m of non-cash impairments of assets, and £0.4m of provisions for future cash costs of exit. Also withdrew from negotiations on potential Market in Spitalfields resulting in impairment charges of £1.0m

o Cape Town Market opening on 17 November 2023 and construction in Porto well advanced with expected opening date in FY24 - for both sites the city's top chefs have been curated

• Time Out Media: digital focus drives improved economics and growing audience

o Gross revenue growth of +25% YoY underpinned by digital revenue growth of 44%

o Improved adjusted EBITDA of £3.1m (2022: £1.7m) with gross margin up by 300 basis points to 80% (2022: 77%)

o Global monthly brand audience grew by 16% to 83m (2022: 72m) as a result of a consistent strategy to bring Time Out content to digital channels

o Winning big-ticket campaigns from an expanding client roster via relationships with agency partners and brand owners, in both existing and new sectors, with continued demand from blue-chip brands for our unique campaign solutions

o Time Out Creative Solutions team delivered bespoke multi-channel campaigns leveraging the entire Time Out platform, combining digital channels with live events in Markets

Commenting on the results, Chris Ohlund, CEO of Time Out Group plc, said:

"This year we achieved important milestones in delivering a further improved adjusted EBITDA - despite the challenging macroeconomic conditions - building on our recent progress and momentum. While this is only the beginning and there is still much to do, we are now positioned for sustained growth and have an ambitious strategy to realise Time Out's potential.

"Our digital strategy for Time Out Media is working, driving significant gross revenue and adjusted EBITDA growth that has exceeded our expectations. Our expanding audience values our "best of the city content" and we are winning high-value campaigns with leading brands. Time Out Market is a much younger business which, now that we have enjoyed a year of uninterrupted trading, demonstrates the unique opportunity it presents: our open Markets continue to grow, and we contracted five new sites in the year as interest from real estate developers remains strong. The portfolio includes six open and nine contracted sites, with more in the pipeline - in a few years, it will more than double in size.

"Synonymous with going out and having a good time, Time Out continues to be trusted and relevant as we inspire and enable millions of people every month to experience the best of the city. Consumers are increasingly spending time on digital channels but still want to socialise in real life - capturing these trends through the combination of Media and Market is powerful."

Outlook

The 2023 financial year provides us with the foundations for continued growth which, combined with ongoing rigorous management of the cost base, can significantly improve future cash flows and profitability. In contrast to most media and hospitality businesses, Time Out Group now has multiple avenues for sustained growth and is building a valuable long term recurring earnings stream.

We expect the step-change in Media performance to continue as demand from blue-chip brands for our unique campaign solutions grows. Over the next 18 months, we are set to open five new Markets which will increase revenues and the signing of new locations globally is expected to continue, supported by a strategy to focus on the highest quality leads. In time, the nine Management Agreements (two open and seven contracted), each with a term of at least 10 years, will generate a contracted minimum aggregate contribution to EBITDA of c.£14m per annum when all are operational.

Despite macroeconomic headwinds, we have increased confidence in future growth and further traction as we continue to deliver against our ambitious plans, with Q1 FY24 performance in line with management expectations.

• Net revenue is calculated as gross revenue less the concessionaires' share of revenue. See appendix Alternative Performance Measures for a reconciliation to the statutory numbers.
• Adjusted EBITDA is operating loss stated before interest, taxation, depreciation, amortisation, share-based payments, exceptional items and profit/(loss) on the disposal of fixed assets. This is a non-GAAP alternative performance measure ("APM") that management uses to aid understanding of the underlying business performance. See appendix Alternative Performance Measures for a reconciliation to the statutory numbers.
• Adjusted net debt excludes lease-related liabilities under IFRS 16. This is an APM. See appendix Alternative Performance Measures for a reconciliation to the statutory numbers.

Chief Executive's Review

Group overview

Financial summary

• Net revenue is calculated as gross revenue less the concessionaires' share of revenue. See appendix Alternative Performance Measures for a reconciliation to statutory numbers.
• Gross margin calculated as gross profit as a percentage of net revenue.
• Adjusted measures are stated before interest, taxation, depreciation, amortisation, share-based payments, exceptional items and profit/(loss) on the disposal of fixed assets. These are APMs that management uses to aid understanding of the underlying business performance. See appendix Alternative Performance Measures for a reconciliation to statutory numbers.

The financial year - the first full reporting period of uninterrupted trading since 2019 - saw continued progress across both the Markets and the Media divisions, positioning the Group for a transition to sustained growth. With its curation of the best of the city combined with ongoing operational improvements, Time Out Market delivered strong revenue growth and increased profitability in addition to a growing pipeline of contracted sites. Time Out Media - following its completed print to digital transformation - achieved significant digital revenue growth and higher EBITDA margin as we attract an increasing audience as well as blue-chip clients seeking our bespoke advertising solutions.

• Group net revenue increased by 37% to £76.0m (2022: £55.4m) and gross margin increased by 100 basis points to 81% (2022: 80%)
• Divisional operating expenses increased by 34%, 3% slower than net revenue as a result of reductions in fixed costs and focus on operational efficiency, partly offset by additional variable costs as sales grew; continued growth offers the scope to further dilute fixed costs as a % of sales
• Improvement in Divisional adjusted EBITDA of £7.4m (2022: £3.9m) with corporate costs decreased by 23% to £2.1m (2022: £2.7m) following a focus on cost reduction and efficiency, delivering benefits now and in future years; this resulted in a positive Group adjusted EBITDA of £5.3m (2022: £1.2m)

Matt Pritchard has been newly appointed Chief Financial Officer, replacing Patrick Foley who had been CFO since September 2022 and decided to leave the business to pursue new opportunities. It is expected that Matt will be appointed to the Board in due course. Matt has over 25 years of experience of value creation in Retail and FMCG, in both private equity and listed environments, including strategic review and funding of growth strategies. From 2014 to 2023, Matt was CFO of Hotel Chocolat PLC. In this role he formulated long term growth strategies including a pivot to digital and prepared the business for IPO in 2016, growing revenues and EBITDA. Prior to this, he worked in senior finance roles with several blue-chip retail organisations including Asda, Somerfield Stores and WHSmith. Matt qualified as a Certified Accountant in 1998.

Time Out Market trading overview

• Net revenue is calculated as gross revenue less concessionaires' share of revenue. See appendix Alternative Performance Measures for a reconciliation to statutory numbers.
• Gross margin calculated as gross profit as a percentage of net revenue.
• Adjusted measures are stated before interest, taxation, depreciation, amortisation, share-based payments, exceptional items and profit/(loss) on the disposal of fixed assets. These are APMs that management uses to aid understanding of the underlying business performance. See appendix Alternative Performance Measures for a reconciliation to statutory numbers.

Time Out Market net revenue increased by 48% to £42.8m (2022: £28.9m) and adjusted EBITDA of £4.3m nearly doubled year-on-year (2022: £2.2m adjusted EBITDA) in the first full financial year of uninterrupted trading and with some restrictions still in place in the comparative year. The year saw travel rebound and across our open sites, footfall from tourists continued to recover at a faster rate than footfall from office workers. We continue to carefully manage operating expenses to drive greater profitability, alongside implementing operational improvements and optimisations of our commercial model. Central costs increased as a strengthened team is working on growing the Markets business, preparing for several upcoming openings and negotiating further new sites.

Sandy Hayek - who joined in 2021 as Time Out Market Dubai General Manager and then became Time Out Market Co-CEO Operations - was promoted to Time Out Market CEO in July 2023 to oversee both the operations of existing and the development of new Markets, reporting into Group CEO Chris Ohlund.

As a food and cultural market bringing the best of the city together under one roof, the ongoing curation of top culinary talents is key to keeping the offering fresh and reflective of the cities we are in. Examples of concessions added in the year include in Lisbon MICHELIN Bib Gourmand awarded O Frade and in New York Bark Barbecue which has a cult following. Furthermore, each Market has an ongoing cultural programme to drive additional high-value footfall, differentiation and engaging content for social media and Time Out channels. Throughout the year, many events took place from live bands and artist performances to DJs and comedy nights.

Across our open Markets, the teams worked on operational efficiencies to improve revenue per sq ft and thereby profitability. As part of our focus to build a profitable portfolio, it was decided that the Miami site would close on 30 June 2023. Following the launch of the first Market in Lisbon in 2014, the Miami site was the first to open as part of the global expansion in 2019 and underperformed post-pandemic, contributing a reported operating loss of £2.7m to the Group result in FY23. The decision to exit resulted in exceptional costs of £7.1m comprising £6.7m of non cash asset impairments, and £0.4m of provisions for future cash liabilities.

In addition to our six existing Markets (Lisbon, New York, Boston, Chicago, Montreal and Dubai - the latter two being Management Agreements), new sites are set to open in Cape Town on 17 November 2023 and in Porto in FY24 - in both sites top local chefs have been curated.

In the year, we accelerated the signing of new Markets and contracted five sites including in Cape Town, Vancouver, Riyadh, Barcelona and Bahrain. This takes the pipeline of new sites in development to nine and the expected opening schedule based on calendar year is structured as follows:

• November 2023: Cape Town (Management Agreement)
• 2024: Porto (Owned & Operated)
• 2024: Barcelona (Owned & Operated)
• 2024: Bahrain (Management Agreement)
• 2024: Vancouver (Management Agreement)
• 2025: Abu Dhabi (Management Agreement)
• 2025: Osaka (Management Agreement)
• 2027: Prague (Management Agreement)
• 2027: Riyadh (Management Agreement)

As growth engine for the continued expansion, we are focused on Management Agreements under which we receive a share of revenues and profits (subject to a minimum guaranteed fee) which increases our recurring revenue stream without capital expenditure. We will consider lease agreements for Owned & Operated sites, where we receive 100% of site profits, when the majority of capex is contributed by the landlord.

We have a pipeline of Management Agreements in advanced negotiations and expect to sign more in the year ahead as we continue to optimise our systematic approach to sourcing high-quality leads. As we grow our portfolio of open Markets we continue to refine selection criteria based on the critical success factors, with the objective of improving return on investment and reducing time to completion. Furthermore, we are developing wider flexibility in formats to best match our Markets proposition to the locality.

In February 2023, we confirmed that we will not proceed with the development of the site at 106 Commercial Street in London - although recommended for approval by planning officers, the Tower Hamlets Development Committee chose to defer its decision on our application in 2022 after a process which had already taken several years. With an expectation of the process being drawn out by further delays we decided to no longer proceed with our application - which resulted in exceptional costs of £1.0m arising from the write-off of sunk pre-development costs - in order to focus our resources on other opportunities.

Time Out Media trading overview

• Gross margin calculated as gross profit as a percentage of gross revenue.
• Adjusted measures are stated before interest, taxation, depreciation, amortisation, share-based payments, exceptional items and profit/(loss) on the disposal of fixed assets. These are APMs that management use to aid understanding of the underlying business performance. See appendix Alternative Performance Measures for a reconciliation to statutory numbers.

Time Out Media trading was encouraging with gross revenue growth of 25% to £33.1m (2022: £26.5m) generating adjusted EBITDA of £3.1m (2022: £1.7m).

Having exited print media in FY22, in our first year as a fully digital media division we successfully tapped into the growing digital advertising space, replacing print with digital revenue:

• Digital gross revenue grew by 44% to £25.8m (2022: £17.9m)
• As a result of the removal of print revenues (2022: £8m) total Media net revenue grew 25%

Gross margin increased by 300 basis points to 80% (2022: 77%). We continue to tightly manage the operating expenditure which increased slower than sales by 23% as we invested in talent with digital expertise and expanded our sales team tasked with growing our client base and winning high-value campaign deals.

The digital growth was driven primarily by the UK and US business. Time Out Media CEO Stacy Bettman - reporting into Group CEO Chris Ohlund - is now applying the same business model to the European and APAC Media business.

A key growth driver and focus going forward are high-value campaigns for an expanding roster of advertising clients including in new sectors. Time Out appeals to advertisers as our Creative Solutions team develops bespoke campaigns to connect them with our brand, content and audience in a brand-safe and positive environment across a 360-degree platform spanning website, mobile, social media, videos, newsletter and live events. In the year we saw increased demand for these multi-channels campaigns from clients such as Diageo, Estrella Damm, TAP Portugal, FREENOW and Uber Eats.

We saw success with campaigns which leverage the synergies between Media (digital high-quality content) and Market (real-life experiences). Examples include campaigns for Mastercard, Maybelline, BATISTETM and P&O Cruises which spanned custom digital content as well as videos and expanded to live events in our Markets. With an expanding global Market footprint, this presents future growth opportunities.

Time Out's global monthly brand audience(1) grew by 16% to 83m (2022: 72m) and by 46% compared to 2019 when it stood at 57m. This is the result of a consistent strategy to bring our content - previously distributed via print - to digital channels to attract and engage a valuable audience. The audience growth demonstrates how the Time Out brand and its "best of the city" content remain relevant. In particular short-form videos continue to be a medium our audience engages with and in which we invest. The year saw an ongoing push of video content on social media (Instagram and TikTok) and our site to drive both direct and programmatic revenue with sponsored video series now often key elements of client campaigns.

Our "best of the city" content spanning 333 cities in 59 countries is curated and created by a global network of local expert journalists. Successful content which drove record traffic numbers in the year included annual global tent poles such as The World's Best Cities and The Coolest Neighbourhoods as well as Halloween coverage which contributed to October being Time Out USA's biggest traffic month of the year. Time Out delivered the 3rd biggest growth of UK news publishers in September 2022 and in March 2023 topped that ranking(2).

Whilst we are using generative AI to support operational efficiency and insights, all of our content creation and editorial curation is performed by expert local writers and editors.

• Global brand audience is the estimated monthly average in the year including all Owned & Operated cities and franchises. It includes print circulation and unique website visitors (Owned & Operated), unique social users (as reported by Facebook and Instagram with social followers on other platforms used as a proxy for unique users), social followers (for other social media platforms), opted-in members and Market visitors.
• Source: Press Gazette using data from © Ipsos, Ipsos iris, 1-30 September 2022 and 1-31 March 2023

Financial Review

• Adjusted EBITDA is operating loss stated before interest, taxation, depreciation, amortisation, share-based payments, exceptional items and profit/(loss) on the disposal of fixed assets. This is an APM that management uses to aid understanding of the underlying business performance. See appendix Alternative Performance Measures for a reconciliation to statutory numbers.

Revenue and gross profit

Group gross revenue for the year increased by 43% to £104.6m (2022: £72.9m) with both Markets and Media delivering gross revenue growth.

Markets gross revenues increased with both growth in existing sites and revenues associated with signing new Management Agreements. Media revenue growth was driven by digital sales growth which more than offset loss in revenues from the exit from print in FY22.

Gross margins increased by 1 percentage point to 81%.

Operating expenses

Administrative expenses of £79.4m grew more slowly than sales, increasing by 35% year-on-year.

Adjusted EBITDA

Group adjusted EBITDA is a non-GAAP Alternative Performance Measure, which is used by the Board to manage business performance and to allocate resources across the Group. Group adjusted EBITDA of £5.3m (FY22 £1.2m) is stated before interest, taxation, depreciation and amortisation, share-based payment charges, exceptional items, and loss on disposal of fixed assets. The material improvement is a result of increased revenues and improved operational efficiency. The £5.3m figure is inclusive of £2.7m of operating losses from the Miami Market, which will not recur.

Operating loss

The reported operating loss was £17.5m (2022: £14.1m loss).

The net exceptional costs of £10.0m (2022: £2.3m) includes costs related to a closure and exit of the Miami Market which ceased trading on 30 June 2023 (£7.1m), staff redundancy costs of staff who left the Group following the restructuring (£1.9m). The majority of the prior year exceptional costs of £2.3m related mainly to redundancy and restructuring costs.

The depreciation charge of £8.9m (2022: £8.6m) had minimal change with an increase of £0.3m. The amortisation of intangible assets of £2.2m (2022: £2.52m) decreased by £0.3m. Overall, on a combined basis there was no change to the charge for depreciation and amortisation.

Net finance costs

Net finance costs of £7.5m (2022: £5.3m) primarily relates to interest on debt of £3.8m (2022: £2.4m), amortisation of deferred financing costs of £0.5m (2022: £0.2m) and interest cost in respect of lease liabilities of £3.0m (2022: £2.6m).

Foreign exchange

The revenue and costs of Group entities reporting in dollars and euros have been consolidated in these financial statements at an average exchange rate of $1.21 (2022 $1.34) and €1.15 (2022: €1.18) respectively.

Cash and debt

Cash and cash equivalents increased by £0.3m since 30 June 2022 to £5.1m (2022: £4.8m). This was driven primarily by the Group Adjusted EBITDA of £5.3m (2022: £1.2m Group Adjusted EBITDA), exceptional costs cash outflow of £1.9m (2022: £2.8m), net working capital outflow of £1.3m (2022: £2.6m), capital expenditure of £2.9m (2022: £1.8m), net proceeds of financing of £5.0m (2022: £3.7m net financing outflow) and the repayment of lease liabilities of £5.1m (2022: £4.0m).

On 24 November 2022, the Group entered into a new €35.0m secured four-year term loan facility with Crestline Europe LLP ("Crestline facility"). The facility has a term of four years, with the right to settle in full after two years. Interest may be capitalised or paid in cash, at the election of the Company, during the first year at a rate of 9.5% plus 3-month EURIBOR and from the second year onwards interest will be paid in cash at a rate of 8.5% plus 3-month EURIBOR. An exit premium payable upon full repayment, is amortised over the duration of the facility with reference to the principal amount drawn. The facility is subject to quarterly financial covenants based on minimum liquidity levels (quarterly testing commenced on 31 December 2022) and target leverage ratio (quarterly testing commenced on 30 June 2023).

The Company has also executed an equity warrant instrument and agreed to issue 11,400,423 equity warrants on 30 November 2022 and a further 2,264,468 at full drawdown of the Loan Note Facility (in total representing approximately 3.6% of its fully diluted share capital) to the Crestline subscribers. The five-year equity warrants, which have customary anti-dilution protections, have an exercise price of 39 pence per ordinary share.

At 30 June 2023 borrowings principally comprised the partially drawn Crestline facility of €31.3m (€29.2m plus capitalised interest), €5m of the original €35m commitment remains undrawn. At 30 June 2022 the borrowings principally comprised the Incus Capital Facility £20.9m, which was fully repaid on 30 November 2022.

On 7 November 2023 the Group agreed to an amendment of an existing £5m unsecured Loan Note with Oakley Capital investments ("OCI") to extend the repayment date to 30 June 2025. This is a related party transaction under AIM Rule 13. Please see further disclosure in relation to this in note 11.

Going concern

The financial statements have been prepared under the going concern basis of accounting as the Directors have a reasonable expectation that the Group and Company will continue in operational existence and be able to settle their liabilities as they fall due for the foreseeable future, being a period of at least 12 months from the date of approval of the financial statements ("forecast period"). In making this determination, the Directors have considered the financial position of the Group, projections of its future performance and the financing facilities that are in place.

In making this assessment the Directors have considered two scenarios over the forecast period: The base case assumes a slow but steady period of growth across both Market and Media. Owned and Operated Market revenues are assumed to see steady growth over the forecast period. Media revenue continues to grow as the Group focuses on high-margin digital-first offerings complemented by the return of Live Events, Affiliate and Offers revenue. This scenario does assume an appropriate element of cost inflation.

The downside case sensitises the base case to assume that the Market Owned & Operated and Media revenues underperform the base case by 10% while maintaining the base case gross margin, with actionable cost mitigation over the forecast period. Consistent with the base case, the sensitised case also assumes an appropriate element of cost inflation.

The Directors consider the downside case reduction in revenue for each division to be unlikely given recent performance, however with the uncertainty created by inflationary and recessionary factors this scenario is considered severe but plausible.

The Board is satisfied that under both scenarios the Group will be able to operate within the level of its current debt and financial covenants and will have sufficient liquidity to meet its financial obligations as they fall due for a period of at least 12 months from the date of signing these financial statements. For this reason, the Group and Company continue to adopt the going concern basis in preparing its financial statements.

Chris Ohlund

Group Chief Executive

Consolidated Income statement

Year ended 30 June 2023

Other comprehensive income:

Items that may be subsequently reclassified to the profit or loss:

Notes to the condensed consolidated statements

Preliminary Information

The consolidated financial statements of Time Out Group PLC for the year ended 30 June 2023 were authorised by the Board on 8 November 2023. Comparative information covers the year ended 30 June 2022.

While the financial information included in these summarised financial statements has been prepared in accordance with the recognition and measurement criteria of UK-adopted International Accounting Standards ("IAS") and with the requirements of the Companies Act 2006 as applicable to companies reporting under those standards, this announcement does not itself contain sufficient information to comply with lASs and IFRSs. The Company expects to publish full financial statements that comply with lASs and IFRSs in November 2023.

The financial information set out above does not constitute the Company's statutory accounts for the year ended 30 June 2023 but is derived from those accounts. The statutory accounts for this year will be finalised on the basis of the financial information presented by the directors in this preliminary announcement and will be delivered to the Registrar of Companies following the Company's Annual General Meeting. The external auditor has reported on the accounts and their report did not contain any statements under Section 498 of the Companies Act 2006.

Going Concern

The financial statements have been prepared under the going concern basis of accounting as the Directors have a reasonable expectation that the Group and Company will continue in operational existence and be able to settle their liabilities as they fall due for the foreseeable future, being a period of at least 12 months from the date of approval of the financial statements ("forecast period").

In making this determination, the Directors have considered the financial position of the Group, projections of its future performance and the financing facilities that are in place. In making this assessment the Directors have considered two scenarios over the forecast period: The base case assumes a slow but steady period of growth across both Market and Media. Owned and Operated Market revenues are assumed to see steady growth over the forecast period. Media revenue continues to grow as the Group focuses on high-margin digital-first offerings complemented by the return of Live Events, Affiliate and Offers revenue. This scenario does assume an appropriate element of cost inflation.

The downside case sensitises the base case to assume that the Market Owned & Operated and Media revenues underperform the base case by 10% while maintaining the base case gross margin, with actionable cost mitigation over the forecast period. Consistent with the base case, the sensitised case also assumes an appropriate element of cost inflation.

The Directors consider the downside case reduction in revenue for each division to be unlikely given recent performance, however with the uncertainty created by inflationary and recessionary factors this scenario is considered severe but plausible.

The Board is satisfied that under both scenarios the Group will be able to operate within the level of its current debt and financial covenants and will have sufficient liquidity to meet its financial obligations as they fall due for a period of at least 12 months from the date of signing these financial statements. For this reason, the Group and Company continue to adopt the going concern basis in preparing its financial statements.

• Accounting policies
• Exchange rates

The significant exchange rates to UK Sterling for the Group are as follows:

Segmental information

In accordance with IFRS 8, the Group's operating segments are based on the figures reviewed by the Board, which represents the chief operating decision maker. The Group comprises two operating segments:

• Time Out Market - this includes Time Out's share of concessionaires' sales, revenues from Time Out operated bars and other revenues include retail, events and sponsorship.
• Time Out Media - this includes the sale of digital and print advertising, local marketing solutions, live events tickets and sponsorship, commissions generated from e-commerce transactions, and fees from our franchise partners.

Year ended 30 June 2023

Gross revenue represents the total value of all media sales revenue, plus food, beverage and retail sales transactions in relation to the North American markets, the Group's share of sales transactions in relation to the Lisbon market and any management agreement fees. Net revenue is calculated as gross revenue less the concessionnaires' share of revenue.

Gross revenue is analysed geographically by origin as follows:

The restructuring costs of £1.9m relates to the reorganisation of the group, principally redundancies, following the Group's decision to exit the Miami market. The prior year relates to redundancy costs following the discontinuation of print in the UK and the establishment of a new senior management team (2022: £2.0m).

Write-off of capitalised costs (£5.3m) and irrecoverable balances (£1.8m) relating to Time Out Market Miami have been recognised following the decision to close the market.

Write-off of capitalised costs relating to Time Out Market Spitalfields have been recognised following the decision to exit the process.

In the prior year discontinued corporate transaction costs of £0.8m related to an aborted corporate transaction. In the prior year the gain on recognition of right-of-use asset and related lease liability arose on the modification of the Time Out Lisbon lease.

Loss per share

Basic loss per share is calculated by dividing the loss attributable to shareholders by the weighted average number of shares during the year.

For diluted loss per share, the weighted average number of shares in issue is adjusted to assume conversion for all dilutive potential shares. All potential ordinary shares including options and deferred shares are antidilutive as they would decrease the loss per share and are therefore not considered. Diluted loss per share is equal to basic loss per share.

Borrowings principally comprise the Crestline Europe LLP facility, which was used to fully repay the Incus Capital Finance loan facility, which was fully repaid on 30 November 2022.

Notes to the cash flow statement

Reconciliation of loss before income tax to cash used in operations

Post balance sheet events

On 7th November 2023 the Directors agreed to enter into an extension of the £5.2m Oakley Capital loan facility to June 2025.

• Principal risks and uncertainties
• Extension of unsecured Loan Note with related party

The Group has agreed to an amendment of the unsecured Loan Note with Oakley Capital investments ("OCI") to extend the repayment date to 30 June 2025. The loan note, listed on The International Stock Exchange ("TISE") will increase from £5.1m to £5.2m (representing interest accrued on the initial Loan Note). The terms remain the same, with interest charged at a 90-day average SONIA rate plus 10% per annum, with an exit premium.

OCI is interested in 67,436,385 ordinary shares of 0.001 pence each in the Company ("Ordinary Shares"), representing approximately 19.97 per cent. of the Company's issued share capital. OCI and Oakley Capital Private Equity L.P. together hold 147,897,400 Ordinary Shares, representing approximately 43.79 per cent. of the Company's issued share capital. As a substantial shareholder in Time Out, OCI is a related party of the Company and the extension of the OCI Loan Note is, for the purposes of AIM Rule 13, considered a related party transaction. The Directors of the Company (excluding Peter Dubens, Non-Executive Chairman of the Company, David Till, Non-Executive Director of the Company and Alexander Collins, Non-Executive Director of the Company, who are not considered independent for the purposes of this transaction as a consequence of being partners of Oakley Capital Private Equity L.P. and Oakley Capital Limited, and Peter Dubens being a non-executive director of OCI) consider that, having consulted with the Company's nominated adviser, Liberum Capital, the terms of the extension of the OCI Loan Note are fair and reasonable insofar as shareholders in the Company are concerned.

Appendix: Alternative Performance Measures

The Group has included various unaudited alternative performance measures (APMs) in its Annual Report and Accounts. The Group includes these non-GAAP measures as it considers these measures to be both useful and necessary to the readers of the Annual Report and Accounts to help them more fully understand the performance and position of the Group. The Group's measures may not be calculated in the same way as similarly titled measures reported by other companies. The APMs should not be viewed in isolation and should be considered as additional supplementary information to the statutory measures. Full reconciliations have been provided between the APMs and their closest statutory measures.

The Group has considered the European Securities and Markets Authority (ESMA) 'Guidelines on Alternative Performance Measures' in these annual results.

Global monthly brand audience is the estimated monthly average in the period including all Owned & Operated cities and franchises. It includes print circulation and unique website visitors (Owned & Operated), unique social users (as reported by Facebook and Instagram with social followers on other platforms used as a proxy for unique users), social followers (for other social media platforms), opted-in members and Market visitors.

Alternative Performance Measures

Adjusted EBITDA

Year ended 30 June 2023