Company Profile

YooMedia plc is one of the fastest growing interactive entertainment companies in the UK.
Since 1997 we have been developing and launching leading B2C consumer brands in the gaming and community sectors. We also work in a B2B capacity with leading brand owners, agencies, content developers and broadcasters to design and develop their interactive content strategies.

Led by Executive Chairman Dr. Michael Sinclair and Group Managing Director Neil MacDonald, YooMedia has assembled a highly experienced management team that possesses a unique blend of skills and experience in the areas of Digital TV, Internet and mobile phone services and technology.

With main office locations in London, Exeter and Maidstone, YooMedia manages core assets including:

Over 30 office locations throughout the UK alone

State-of-the-art studio, production and post-production facilities at our Wapping location.

UK broadcast return path & bandwidth owner

Fully fledged UK Bookmaker License

Database with over 350K UK singles

SMS Engine access with international reach

Fully staffed 50 seat Customer Contact Centre in Maidstone, Kent

YooMedia Dating & Chat - Our dating subsidiary company manages the oldest and largest UK-owned dating brands including Dateline, Club Sirius and Avenues. YooMedia Dating has over 20 office locations throughout the UK and also manages YooChat, our world-leading interactive chat service found on UK digital cable on the Telewest platform (platform extensions planned for 2005).

YooMedia Gambling & Games - Combining the brands of Avago and Channel 425 (in partnership with William Hill) YooMedia is on the leading-edge of interactive fixed odds, casino and poker gambling services for digital TV, the web and 3G mobile phones. Our gaming business also manages YooPlay, the only interactive just for fun games channel found on all four Digital TV platforms in the United Kingdom.

YooMedia Enhanced Solutions (YES) - YES works with brand owners, agencies, content owners and broadcasters to clarify the options, define the strategies and deliver the interactive content that enhances consumer and audience experiences. YES customers include the BBC, Nestle, Celador, William Hill, Channel 4, ZipTV, The Cartoon Network and HR Owen.

Been in touch with a certain newspaper and asked them to look at the matter. If you feel offended, I suggest you do the same. Most can be contacted online.

Quite a lot of buying going on today as well - why if the price is going to go further south or stay cheap - would anybody be buying now? It may be that the market will like the deal and once the sellers have shed some shares the price will rise - like flowers in springtime! - Or maybe I shouyld take some more drugs and then it won't hurt anymore!!!

Whatever has been done cannot be changed. Like the rest of you I am now making a big loss but at the end of the day Yoomedia is a great long term bet. They may have cocked up over this but the best thing to do imho is buy some more. It aint gonna stay this low for long. I've just bought some more which brings down the price I need to make a profit much lower. Most of us are in this for the long term after all. Buy some more shares and long term we will all be laughing and hopefully forget about this fiasco.

The deal is not done until it has been approved by the shareholders. I am not against the deal per se but I am against the way it was done and the directors pulling a fast one.They should sink or swim on this one like the rest of us. The deal can be approved while stopping some of the less savoury elements of it. Enough said. Up to you fellows.

3.5 million advisors fees and restructuring charges!
Now I am really out of here.

Had a few hours to think things through.

Let's wait for next week. You never know, with an EVO upgrade early next week, 25p might be achieved, then many of us would feel a lot more relaxed.

However, I was happy with the old Yoomedia, simple, well structured, clearly defined divisions. However, if the directors in their wisdom, decide this is the best way forward, then I must either accept thier better judgement or get out. I will hold for the next two years and see if they can indeed make this work.

I DO NOT ACCEPT THE ADDITONAL 16M IN SHARE OPTIONS AT 15P. THIS IS OUTRAGEOUS.

Fair enough, it probably places a floor on the price, if the directors are prepared to add more, in addition to thier existing shares. However, how do we know that the 25m placement at 15p, could not have been done at 20p. Yet the directors thought better of it, simply to line their own pockets at 15p.

Presumably, we can vote through the other motions concerning the aquistion, but block the options. Can I urge any major shareholder, who's vote counts at the EGM, to reject the share option proposal.

Of course, my frustration would decrease, if the SP rises next week, on the back of a brokers note. But that's a BIG if.

Let's all read EVO's words of wisdom next week. Should be very interesting reading.

Was stuck in an M25 jam this afternoon when the RNS was issued - finally stopped for a curry before arriving home for the news. At least the curry was good! I think it will help us to have a dialogue on the following questions?

1. Does the deal make sense to the company? Probably yes. It essentially puts in a couple of years growth which could be very important in the context of the emerging market. It probably makes more sense than the acquisition policy of lastminute.com, for instance, just buying share in a large existing market and never reaching the light of day of real profits. There are significant savings in joint overheads and positive cashflow is predicted by end of next March.

2. Why is the share price as low as 15p? At first sight this is puzzling. YOO have done this before, raising funds at 30p when the price was mid forties. Alizyme (AZM) as an example raised funds at 31p (I think) at the bottom of the market when the price was around that level. They did the same at 169p later last year, again just below the trading price. SEY and AP. (Alltracel) have done the same. I suspect the answer lies in the overall numbers. Could the cap. value support a higher price? I suspect that YOO have had problems getting the funds underwritten given the combined loss making of the two companies. I suspect also that they may have been out-thought by Evolution Securities who are taking the so-called risk if they are not able to place the stock.

3. Is it a good deal for (ordinary) shareholders? In the sense that what is good for the company in the long-term is good for the long-term investor, the answer could well be positive. However, I believe the option of a placing to selected investors, as opposed to a rights issue, is immoral. It is quite possibly cheaper and, no doubt, quicker. Rights issues seem to have gone out of fashion? Perhaps there are readers who can either explain or justify?

4. What can be done about it? The EGM is a stitch-up in the sense that 42.5% of the vote is already there. What about: "if you can't beat them, join them" and get involved in the evolution placing? Can anyone comment on the practicality of this route?

5. Whither the share price? I can't see the logic of paying 19.5p in the market if shares can be bought at 15p. The new shares can't be traded until after the EGM although evolution will, no doubt, be already placing them conditionally. But this is an overhang to the market in any case. The Enlarged Group historical turnover is 61m (presumably gambling revenue at gross) but with historical loss of 12m+ and not moving into profit until sometime next year on a monthly basis, it is difficult to see a cap. of more than 100K or 22p per share. Good acquisition for the long-term holder but little scope in the short-term. So it depends what your objectives are. If you are an aggressive operator, as I am, YOO may no longer be the share for us. They could be a very good holding to tuck away rising over a reasonable period towards the mid-cap area.

A fairly long think through, to help me as well as anyone else. Any thoughts on the legality/morality of eschewing the rights issue path? How about the acquisition of shares via evolution?

Eric

EW ROBSON

EVO have already placed all the 15p shares. I know this. Take it or leave it.

A bullish note by EVO next week and we may be pleasantly surprised.

MONDAY'S open PRICE 17 or 22 ?

I think EWRobson has given a good and accurate summation. Similar in tone to that of Johngtudor who called this earlier in the week.
I see the price in the 17 - 20 range for some time to come. Not for me because I think there are better stocks out there - but there again I've got Yoo wrong once before! Each to his own.
iPublic. As for Evo do you think they can morally and ethically produce a note of any kind given the part they play in the scheme? Surely they should recuse themselves from comment. They are under enough of a cloud as it is.
As for the rights or partially rights issue - there would have been an expense but they didn't get this job done cheaply either in terms of the offer price or the deal expenses. Surely they could have got a better stock price if they had raised part of the money in a rights issue as a 2 phased approach to a (disclosed) friendly acquisition.

The Enlarged Group's key strengths to be:

. its position as one of the UK's leading iTV entertainment and digital solutions companies;

. a balanced portfolio of revenue streams and profit centres in the key high growth market sectors;

. an ability to achieve higher operating margins, through the realisation of revenue enhancing and cost saving synergies after the Acquisitions;

. ownership of customer brands and channels and the ability to market and promote other Enlarged Group products and services across other interactive media platforms;

. a number of strong strategic partnerships, including a close working relationship with Sky; and

. significant technological and contractual barriers to entry with a limited number of competitors.

The Enlarged Group Board considers that it will be able to utilise these key strengths and maximise its growth opportunities in the future. The Acquisitions will create one of the largest independent iTV and media businesses in the UK. The key strategy of the Enlarged Group will be to exploit fully the operating strengths within YooMedia, DITG and TGC and in so doing build on the benefits and opportunities that are provided by combining the businesses into a single entity.

The new Board has identified the following as key objectives:

. achieve positive cashflow for the Enlarged Group by 31 March'05 based on anticipated revenue growth and margin improvements within the Enlarged Group.

. cement its position and become one of the largest broadcasters of gambling channels and interactive services in the UK. A key element of this strategy will be the continued promotion of Channel 425 by working closely with William Hill to develop the channel and expand the service to cable;

. launch of new broadcasting channels to expand the Group's dating and games brands using DITG's existing technology, infrastructure and other resources;

. expand the service offering of the iPublic division, taking advantage of the Government's desire to provide public information and transaction services through iTV and mobile;

. expand the business into new international territories following the growth of digital television, particularly in the US where the new Board believes digital television will continue to grow; and

. develop and expand its portfolio of mobile and text to TV services both for broadcasters looking to increase interactivity and for retailers looking to increase consumer awareness of their brands.

iturama

Morals and ethics have no place in the city, never have done. Not sure if you sold out or not. Your call, your money.

EVO will be producing a new research note next week, you can bank on it. EVO will be looking to win back friends in the city. The shares HAVE ALL been taken at the 15p placement. So the SP reaction to EVO's research note, will be interesting.

I can't see EVO producing a hold or weak buy note. They would get hung, drawn and quartered by the fund managers. LOL.

iPublic
Yes I sold out at 18p on Friday. That is now behind me and I really shouldn't be here any more. I hope things go well for you all in the future.

iturama

Thanks.

Very gracious of you. Hope you find a good home for your money.

Buried in the letter is a comment that Yoodating, enjoys margins of 65%, currently running at breakeven.

With new dating products planned on TV, Web, mobile and the expansion into America, Europe next year, any further upturn in business, will deliver a substantial profit.

Once again, if you can be patient, the 29m of tax losses, makes Yoomedia a hot favourite for a takeover from H2 2005. Infact, this is an important aspect of the deal. Preditors will note the 29m of tax losses.

If not, then no tax to pay for years. How much in pence per share is this worth?

Allow 6 months for the merger to 'bed in' then it's 'takeover alert' in my opinion. As Nissi mentioned several weeks ago, a buyer will target us when we have just moved into profit and all the hard work is done, rather than wait until the group enjoys profits of 10m+. Anytime from H2 onwards is a possibilty.

Enjoyable evening out with a good meal and Marti Webb oin "Tell me on a Sunday". You win some and lose some so YOO is no great deal: ASC and, hopefully, PET on Monday. Pretty well lost interest in YOO already - small shareholders shafted by Board and evolution; Board shafted by evolution. Not even anything illegal to act on. We had our dreams: they say it is better to travel hopefully than arrive. evolution should have a good story but this will hardly carry the cap. above 100m or 22p a share. Might be worth holding until the annual results and forecast for 2005, but I suspect that is unlikely because there are competitors for my limited funds. Probably a sitting duck for a takeover, with directors and their allies holdings much reduced from the 42% guaranteed to vote for the resolution. Its sad what you say, iPublic, about the morals of the city. Fair enough in a way as the game is to try and outflank the city. I've personally beaten all known pundits into a cocked hat since January last year and jolly pleased about it, I expect many of you have, but you can't beat the system and it will eat up your equity value whilst you are not looking. Why else did evolution have a 500K fine; chicken feed when they extort 2m+ out of YOO and are laughing all the way to the bank.

Keep your pecker up! Eric

http://media.guardian.co.uk/broadcast/story/0,,1180539,00.html


Interactive gameshows head for terrestrial TV

Owen Gibson, chief reporter
Tuesday March 30, 2004

Gameshows that enable viewers to win cash prizes by playing through their remote controls are set to become a common sight after the UK's biggest interactive TV company signed a deal with the team behind Stars in Their Eyes and You've Been Framed.

The Digital Interactive Television Group, which has nine channels on Sky including bingo channel Avago, said today it was weeks away from signing the first in a series of deals with terrestrial channels to develop gameshows.

It has unveiled a partnership with Ludus, the company set up by the Action Time founders, Stephen Leahy and Trish Kinane, to produce and sell TV formats around the world.

Mr Leahy said the technology would be virtually invisible to the viewer, making it even more attractive.

"We were dazzled by Avago - in particular the way in which the advanced and sophisticated technology is disguised to give the viewer 'easy entertainment' in a new and unique format," he said.

Mr Leahy and Ms Kinane sold Action Time, which developed You've Been Framed, Catchphrase and Stars in Their Eyes for ITV, to Carlton in 2002 before launching Ludus.

Debbie Mason, the creative director of DITG and the founder of Avago, said the attempts of ITV, Channel 4 and Channel Five to involve viewers through the red button on their remotes had largely fallen flat.

"Interactive works best when it's totally contextualised. They haven't got the sense of interacting with the viewer," said Ms Mason, adding the deal would take the company "to the heart of the mass entertainment market".


DITG, which recently bought rival GoInteract TV, had a turnover of 50m last year, largely thanks to the success of Avago, a bingo-style game during which the presenter talks directly to the viewers by name.

The company, which is headed by former BT and Dixons executive Neil MacDonald, recently launched iSports TV.

The virtual sports channel uses computer simulations of races and Ms Mason said it had already proved its appeal to more committed gamblers.

She said DITG would launch a second sports gambling channel, a City-based channel, a travel channel and another general entertainment channel this year.

"One, if not two" deals with terrestrial channels would be unveiled in the next few weeks, Ms Mason added.

"The Enlarged Group Board also anticipates finalising agreements with two other broadcasters within three months from Admission."

Yet another company trying to run before it can walk.

Well, they are running faster and faster perhaps to the satisfaction of the Directors, who will all have had a personal rights issue at 15p, but to the detriment of the smaller shareholder. Just writing to Shares in the hope that they will take up the injustice!

Eric