Final Results

Time Out Group plc (AIM: TMO), the global media and hospitality business, today announces its audited preliminary results for the twelve months ended 30 June 2024.

Group financial highlights

• Like-for-like revenue(1,2) increased by 7% with Media +11% and Markets +4%
• Reported revenue of £103.1m (2023: £104.6m) decreased by 1% impacted by stronger GBP vs USD and Euro
• Adjusted EBITDA(1,3,6) increased by 134% to £12.4m (2023: £5.3m)
• Media +101% to £5.3m (2023 £2.6m)
• Markets +87% to £12.0m (2023 £6.4m)
• Operating loss narrowed to £0.0m (2023: £17.5m loss)
• Cash of £5.9m at 30 June 2024 (2023: £5.1m) and borrowings of £38.9m (2023: £29.9m), resulted in adjusted net debt(1,4) of £33.0m (2023: £24.8m). Statutory net debt was £57.9m (2023: £49.7m) including £24.9m of IFRS 16 lease liabilities (2023: £24.9m)
• Proposed Placing of new ordinary shares to raise approximately £8m growth capital for new Markets and IT announced separately today

Operational highlights

• Growing portfolio of nine open Markets, three of which opened in the last twelve months: Cape Town in November 2023, Porto in May 2024 and Barcelona after the period end, in July 2024
• Seven additional Markets expected to be opened by FY27 close, with a strong pipeline of further opportunities
• Global monthly brand reach grew by 8% to 150m(5)
• New 'out of home' advertising revenue trial live in New York Market
• Winning big-ticket campaigns from an expanding client roster including a new global media campaign and cross-platform partnership with Coca-Cola

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

"The Time Out brand is a critical contributor to the success of both Media and Markets, and rather than view these businesses as two separate units, we believe there is substantial potential to increase the synergies between the two and cement Time Out as a unique proposition, both for our audience and for our commercial partners.

"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. Our turnaround programme has transformed the EBITDA profitability of the Group. We are now focused on executing our growth strategy. On behalf of the Board, I would like to thank all of the Time Out team for delivering this result."

Current Trading and Outlook

The Group has a clear plan to drive like for like growth in existing Markets, whilst continuing to convert the strong pipeline of potential new Market sites and large media advertising deals and trading for FY25 remains in line with management expectations.

Having opened seven Markets in 10 years, we expect to open seven Markets in the period from November 2023 to November 2025 and reach a minimum of 16 Markets by 2027. When coupled with a continued pipeline of new opportunities, this growth can rapidly improve the operational gearing of our fixed cost base, meaning we have the potential to continue to grow profitability at a faster rate than sales. We continue to receive approaches from commercial parties keen to work with the Time Out brand and are increasingly confident in our global strategy.

• 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.
• Like-for-like revenue is calculated for comparison using FY23 foreign exchange rates to convert both FY24 and FY23 foreign currency revenues, with FY23 revenues related to Miami excluded.
• 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.
• Adjusted net debt excludes lease-related liabilities under IFRS 16.
• Global monthly brand reach is the estimated monthly average in the year including all Owned & Operated cities and franchises.
• Consistent with FY24, FY23 comparatives have been restated to present £1.7m of group costs, previously recorded within Media, within corporate costs and exclude £2.1m recharges between Media and Market to better represent the actual costs of the underlying segments.

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Chief Executive's Review

Group overview

Financial summary

• 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.
• Like-for-like revenue is calculated for comparison using FY23 foreign exchange rates to convert both FY24 and FY23 foreign currency revenues, with FY23 revenues related to Miami excluded.
• Net revenue is calculated as revenue less concessionaires' share of revenue.
• Gross margin is 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.
• Consistent with FY24, FY23 comparatives have been restated to present £1.7m of group costs, previously recorded within Media, within corporate costs and exclude £2.1m recharges between Media and Market to better represent the actual costs of the underlying segments.

The Group achieved strong Like-for-like revenue coupled with disciplined control of costs which resulted in adjusted EBITDA of £12.4m (2023 £5.3m), and an operating loss of £0.0m (2023: £17.5m):

• Like-for-like revenue increased by 7% and gross margin increased by 1% to 82% (2023: 81%)
• The Group generates the majority of its revenues and EBITDA in US dollars and Euros. A stronger pound acted as headwind against revenue growth on a statutory basis, reported revenue in GBP decreased by 1% to £103.1m
• Divisional adjusted operating expenses decreased by 10% because of reductions in fixed costs and focus on operational efficiency, partly offset by additional variable costs as sales grew. Continued revenue growth offers the scope to further dilute fixed costs as a percentage of sales

Time Out Market trading overview

• 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.
• Like-for-like revenue is calculated for comparison using FY23 foreign exchange rates to convert both FY24 and FY23 foreign currency revenues, with FY23 revenues related to Miami excluded.
• Net revenue is calculated as revenue less concessionaires' share of revenue.
• Gross margin is 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.
• Consistent with FY24, FY23 comparatives have been restated to exclude £2.1m recharges between Media and Market to better represent the actual costs of the underlying segments.

Like-for-like revenue increased by 4%. Statutory revenue decreased by 6% to £67.2m (2023: £71.5m).

During the year, new Markets were opened in Cape Town in November 2023 (management agreement) and Porto May 2024 (owned and operated). The Owned and Operated Barcelona Market opened shortly after the year-end in July 2024. All three have strong chef lineups, including chefs with a combined total of nine Michelin stars.

Adjusted EBITDA increased 87% to £12.0m (2023 £6.4m).

Two new management agreements, Bahrain and Budapest, were announced in the year which, in addition to Vancouver and Osaka, are expected to open within the next 12 months. In total, our 16 Markets are expected to generate more than 20 million transactions per year. The expected opening schedule based on calendar year is as follows:

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• 2024: Bahrain
• 2025: Osaka
• 2025: Vancouver
• 2025: Budapest
• 2025: Abu Dhabi
• 2027: Prague
• 2027: Riyadh

We have a strong pipeline of management agreements in negotiation 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 proven critical success factors, with the objective of improving return on investment and reducing time to completion.

Time Out Media trading overview

• 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.
• Like-for-like revenue is calculated for comparison using FY23 foreign exchange rates to convert both FY24 and FY23 foreign currency revenues, with FY23 revenues related to Miami excluded.
• Gross margin is calculated as gross profit as a percentage of revenue.
• Adjusted measures are stated before interest, taxation, depreciation, amortisation, share-based payments, exceptional items and profit/(loss) on the disposal of fixed assets.
• Consistent with FY24, FY23 comparatives have been restated to present £1.7m of group costs, previously recorded within Media, within corporate costs and exclude £2.1m recharges between Media and Market to better represent the actual costs of the underlying segments.

Time Out Media trading was encouraging with Like-for-like revenue growth of 11% to £36.9m and adjusted EBITDA of £5.3m (2023: £2.6m).

Gross margin decreased by 1% to 79% (2023: 80%). We continue to tightly manage the operating expenditure which decreased by 3% whilst we invest in talent with digital expertise and expanded our sales team tasked with growing our client base and winning high-value campaign deals.

A particular highlight that illustrates the success of the strategy to focus on higher-ticket deals with global brands was the creative campaign for Coca-Cola™. During 2024 the number of deals worth more than £100k increased by 17%.

As a result of a focus to engage our audience by increasing video content, Instagram and TikTok views grew by 90% YoY.

Editorial coverage picked by publications globally drives strong PR reach and global brand awareness, which is reflected in our global monthly brand reach growth of 8% to 150 million.

Group Financial Review

• 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.
• Like-for-like revenue is calculated for comparison using FY23 foreign exchange rates to convert both FY24 and FY23 foreign currency revenues, with FY23 revenues related to Miami excluded.
• Net revenue is calculated as revenue less concessionaires' share of revenue.
• Gross margin is calculated as gross profit as a percentage of net revenue.
• 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.

Revenue and gross profit

Like-for-like revenue increased by 7% with both Markets and Media delivering growth.

Market reported revenues fell by 6% to £67.2m due to the closure of Miami in 2023, and stronger GBP vs USD. Revenue associated with management agreements fell 4% to £4.2m (2023: £4.2m).

Media revenue increased 8% to £35.9m (2023: £33.1m) driven by digital sales growth and live events.

Gross margins increased by 1% to 82%, largely due to the 15% reduction in concessionaire share.

Administrative expenses and operating loss

Administrative expenses of £64.7m decreased by 18% (2023: £79.4m) resulting in the narrowing of operating loss to £0.0m (2023: £17.5m).

The depreciation & amortisation charge of £9.5m (2023: £11.1m) has decreased due to some assets becoming fully depreciated.

Exceptional items of £1.2m relate to restructuring costs (2023: £1.9m).

In 2023, £5.3m write-off of capitalised costs and £1.8m irrecoverable balances relating to Time Out Market Miami were recognised as exceptional cost following the decision to close the Market. Capitalised costs of £1m relating to Time Out Market Spitalfields were also recognised as exceptional following the decision to exit the process.

Adjusted EBITDA

Adjusted EBITDA of £12.4m (FY23 £5.3m) is stated before interest, taxation, depreciation and amortisation, share-based payment charges, exceptional items, and loss on disposal of fixed assets. This material improvement is a result of increased gross profits and improved operational efficiency.

Net finance costs

Net finance costs of £8.5m (2023: £7.5m) primarily relates to interest on debt of £5.0m (2023: £3.8m), amortisation of deferred financing costs of £1.0m (2023: £0.5m) and interest cost in respect of lease liabilities of £2.7m (2023: £3.0m).

Foreign exchange

The revenue and costs of Group entities reporting in USD and Euros have been consolidated in these financial statements at an average exchange rate of $1.26 (2023: $1.21) and €1.16 (2023: €1.15) respectively.

Cash and debt

• 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.

Cash and cash equivalents increased by £0.8m to £5.9m (2023: £5.1m). This was driven primarily by Adjusted EBITDA of £12.4m (2023 £5.3m) offset by exceptional costs cash outflow of £1.2m (2023: £10.0m), net working capital inflow of 1.3m (2023: £1.3m), capital expenditure of £10.6m (2023: £2.9m), net proceeds of financing of £1.8m (2023: £0.1m net outflow). As at 30 June 2024 borrowings principally comprised a loan facility with Crestline of €33.3m (€29.2m plus capitalised interest).

Post Balance Sheet Events: Extension of unsecured Loan Note with related party

On 29 October 2024, the Group agreed to an amendment of an existing £5.2m unsecured loan note with Oakley Capital Investments ("OCI") to extend the repayment date to 30 June 2026, with interest charged at a 90 day average SONIA rate plus 8% per annum (a reduction from 10% per annum) and no exit premium. This is a related party transaction under AIM Rule 13.

OCI is interested in 128,542,622 ordinary shares of 0.1 pence each in the Company ("Ordinary Shares"), representing approximately 37.77 per cent. of the Company's issued share capital. OCI, in combination with the wider Oakley Concert Party together hold 41.68 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, Panmure Liberum, the terms of the extension of the OCI Loan Note are fair and reasonable insofar as shareholders in the Company are concerned.

Post Balance Sheet Event: new issue of warrants

On 30 November 2024 the Company will issue approximately 2,552,476 warrants under the warrant instrument entered into on 30 November 2022 with Crestline Europe LLP (the "Crestline Warrant Instrument"). These warrants will have a strike price equal to the lower of (a) the arithmetic average of the daily volume weighted average price of an Ordinary Share on AIM as shown on Bloomberg on each of the 30 consecutive dealing days immediately preceding 30 November 2024 and (b) 39 pence. This brings the total number of warrants issued under the Crestline Warrant Instrument to approximately 16,488,494.

Proposed Placing of ordinary shares for growth capital

The Group intends to announce a proposed placing of ordinary shares, to raise approximately £8m of gross proceeds. If completed, it is intended that the proceeds of the Placing will be used to support growth, via up-front cash investments in new Market leases in London and New York and to accelerate investment in IT in order to grow audience reach. The Company expects to issue further details of the Placing shortly following the release of this announcement.

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 the 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.

The Board is satisfied that 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 the Company continue to adopt the going concern basis in preparing its financial statements.

Chris Ohlund

Group Chief Executive

Consolidated Income statement

for the year ended 30 June 2024

Other comprehensive expense:

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

Notes to the consolidated statements

Preliminary Information

The consolidated financial statements of Time Out Group PLC for the year ended 30 June 2024 were authorised by the Board on 29 October 2024. Comparative information covers the year ended 30 June 2023.

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 2024.

The financial information set out above does not constitute the Company's statutory accounts for the year ended 30 June 2024 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.

Accounting policies

The same accounting policies and methods of computation are followed in these set of financial statements as applied in the Group's latest annual audited financial statements.

Exchange rates

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

The restructuring costs relates to the reorganisation of the Group, principally redundancies £1.1m (2023: £1.9m).

Cash and net debt

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

Group reconciliation of loss before income tax to cash used in operations

Post balance sheet events

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 2026. The loan note, listed on The International Stock Exchange ("TISE") will increase from £5.2m to £6.02m (representing interest accrued on the pre-existing Loan Note). The terms remain the same, save for a reduction in interest charged at a 90-day average SONIA rate plus 8% (reduced from 10%) per annum, applied from 1 January 2024.

OCI is interested in 128,542,622 ordinary shares of 0.1 pence each in the Company ("Ordinary Shares"), representing approximately 37.77 per cent. of the Company's issued share capital. OCI, in combination with the wider Oakley Concert Party together hold 41.68 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, Panmure Liberum, the terms of the extension of the OCI Loan Note are fair and reasonable insofar as shareholders in the Company are concerned.

Proposed Placing of ordinary shares for growth capital

The Group intends to announce a proposed placing of ordinary shares, to raise approximately £8m of gross proceeds. If completed, it is intended that the proceeds of the Placing will be used to support growth, via up-front cash investments in new Market leases in London and New York and to accelerate investment in IT in order to grow audience reach. The Company expects to issue further details of the Placing shortly following the release of this announcement.

Principal risks and uncertainties

Appendices: Alternative Performance Measures

Appendix 1 - Explanation of alternative performance measures (APMs)

Global brand reach 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.

Appendix 2 - Adjusted net debt

Consistent with FY24, FY23 comparatives have been restated to present £1.7m of group costs, previously recorded within Media, within corporate costs and exclude £2.1m recharges between Media and Market to better represent the actual costs of the underlying segments.