Relationships with debuts

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The company RED CARPET MEDIA GROUP S.A. was newly listed on NewConnect on 4 October 2022.

RED CARPET MEDIA GROUP S.A.  is the 377^th company listed on NewConnect and the 11^th new listing on NewConnect in 2022.

Key information

* transactions in 12 months before the date of the information document, weighted average price per transaction: PLN 78.31.

** at the reference price of PLN 90 equal to the issue price of series B shares offered in the public offering.

Issuer’s history and business

The legal predecessor of the Issuer was established in 2010 under the name Edusat Chanel sp. z o.o. In 2015, the Issuer’s legal predecessor received a licence from the National Broadcasting Council (KRRiT) to broadcast a television channel under the name “E TV”. As a result of ownership changes, the legal predecessor changed its name in 2018 to Red Carpet Media Group sp. z o.o. and the name of the channel “E TV” was changed to “Red Carpet TV”. As of May 2020, the Issuer operates as a joint-stock company.

The Issuer’s core business is the production and distribution in telecommunications networks (cable television networks, satellite television platforms, terrestrial digital television platforms, Internet platforms) of television programmes dedicated to films, television series and pop culture, offered for distribution in Poland free of charge and financed with advertising revenues, and in the USA and Canada for the Polish community in the IPTV streaming model (for which the Company receives distribution fees from the operators of the platforms DISH and Sling.tv). The Issuer operates two licensed television channels called “Red Carpet TV” and “Red TOP TV”. 

On 31 May 2022, the Issuer launched its own VOD platform called “RED GO”, which currently provides access to 650 television series and films. The Company has a total of approximately 4,800 titles in the “Classic” library, which are gradually being prepared for exploitation on the launched platform.

The Issuer is also active in the production of video materials and television programmes. As at the date of the Information Document, the Issuer’s core team comprises a total of 27 people working under contracts for work.

The Company’s share capital amounts to PLN 465,000 and is divided into 465,000 series A and B shares with a nominal value of PLN 1 each, including:

• 415,000 series A shares;
• 50000 series B shares.

The application for introduction covers all issued shares.

Public Offering of Series B Shares

The Public Offering of Series B Shares was conducted in the period from 10 to 30 December 2021. The Series B Shares were issued under a resolution of the Issuer’s EGM of 10 December 2021 and offered by way of a public offering at an issue price of PLN 90 per share. The shares were taken up by 6 investors for cash contributions, including 3 related parties which took up 94.8% of the series B shares.

The Issuer raised a total of PLN 4.5 million from the issue of Series B Shares. A significant part of the funds raised in the issue was used for the redemption of promissory notes from related parties (PLN 3.5 million). Funds raised through promissory notes from related parties had been used on an ongoing basis for the development of the Issuer, in particular for the development of the channel Red Carpet TV and preparation for the launch of the channel Red TOP TV. The remainder of the funds will ultimately be used for the configuration of the Issuer’s VOD platform, purchase of licences for premium content, translations and mastering of materials.

Transactions in shares of the Issuer

There were 12 transactions in series A and B shares of the Issuer in the period of 12 months before the date of the information document at prices ranging from PLN 65 to PLN 92. The average price of the transactions weighted by the number of shares was PLN 78.31.

Issuer’s selected financials:

In 2021, distribution fees received from television platform operators in the US had the dominant share in the Issuer’s sales revenues (73% of revenues), while advertising and video production revenues accounted for 14% and 13% of revenues generated in 2021, respectively. In H1 2022, due to a decrease in the number of subscribers of the Issuer’s programmes in the US and Canada, the Issuer’s revenues from foreign television platforms decreased significantly and accounted for 42.7% of revenues, combined with an increase in revenues from advertising (41.5%) and video production (15.8%).

Company Shareholders

• Leszek Kułak* – 326,398 shares representing 70.19% of the equity and votes;
• Renata Nowicka – Kułak** – 23,550 shares representing 5.06% of the equity and votes;
• Other shareholders (related parties)  – 5,080 shares representing 1.09% of the equity and votes;
• Other shareholders (non-related parties)  – 109,972 shares representing 23.65% of the equity and votes;

* together with KLL sp. z o.o., a subsidiary of Leszek Kułak, and Red Carpet Technologies sp. z o.o., an indirect subsidiary of Leszek Kułak, which hold a total of 318,398 shares of the Issuer.

** together with SMS4YOU sp. z o.o., a subsidiary of Renata Nowicka-Kułak, holding 20,323 shares of the Issuer

Financial instruments newly listed on NewConnect:

• 415,000 series A shares;
• 50,000 series B shares.