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The results for the period ending 31 December, 2000 showed a loss before taxation but after goodwill, amortisation and depreciation of STG4.14 million, and basic losses per share of STG0.3899.
The company said it had just under STG192,000 in cash left and was now seeking to raise some STG1.85 million to compensate for cost overruns and delays.
"We have spent the last 18 months spending money and improving the Web site, and that is what the results reflect," the company's Chairman Nicholas Cowan told ElectricNews.Net.
In a statement the company said its initiatives, including the establishment of an Internet radio station and a new Web site, had proved expensive -- the Web site overran its budget and was substantially delayed, and "did not produce a satisfactory result". The company now needs to spend further sums to deliver a functional solution, it said, and to ensure the future robustness of the Web site.
"We had to raise additional funds to pay for some of the things we had already done," Cowan said. "We announced today a placing and open offer to raise STG1.85 million, after expenses of new equity and full details of this are set out in the prospectus which will be sent to shareholders," he said.
In May 2000 Internet Music and Media acquired Groovetech LLC and Lupine Ventures Limited which, according to the company, led to the transformation of Chandra from a cash shell into an Internet broadcaster and on-line retailer of electronic dance music. It said that groovetech.com is now fully operational and generating increasing sales.
Independent Music & Media, along with many other on-line music Web sites, has found itself in a difficult market along with virtually all of the companies selling music services over the Web.
"I can tell you, there is no proven revenue model yet," Wes Himes, director of the European Digital Music Association told ElectricNews.Net. He said, "The general consensus, about a year ago, was that advertising was the best model was it but since then, many have decided that they needed to sell a product."
He said the on-line music industry, including companies like Independent Music & Media, was struggling to determine which model worked best, but he remained optimistic about the future of the industry.
"We are only at the very tip of the iceberg for people who want to buy entertainment through the Internet or wireless devices. The younger generation is even more receptive to the idea than those who are currently using the technology. When they have more disposable income it will really take off," said Himes
The Independent Music & Media broadcasts via the Internet from San Francisco, Seattle and London. The radio station in London also includes a recording studio and a warehouse, which serves as the European distribution centre for vinyl records, CDs and other merchandise.
Included with Friday's announcement, the company said it was in negotiations for sponsorship deals and is beginning to market general merchandise through the new Web site. Currently its primary revenue stream is from the delivery of CDs, cassettes and vinyl records to consumers. However the through its record label, Independent Music & Media is releasing products into the retail market with one album going to stores in the next few days.
Cowan told ElectricNews.Net that he thought on-line music Web sites could be successful if they found a niche in which to operate. "We are in completely different world, and by its very nature the music we are selling appeals to computer users because it's computer generated."
He said that he knew of no other companies that sold electronic dance music exclusively, on a global basis.
Additional reporting by Matthew Clark
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