The veteran TV presenter Sir David Frost has been forced to come to the aid of Newsplayer Group, which distributes videos of his interviews, for the second time in less than nine months.

Sir David, a non-executive director of Newsplayer, and chairman David Holdgate will invest a total of £192,000 in the company as part of a 16.4m new share issue. Yesterday, the company said this was to ensure "the working capital available to the company and its subsidiaries will be sufficient for their present requirements for at least 12 months".

The new stock, which represents 18% of the company's enlarged issued share capital, has also been placed with institutional and other investors at 4.5p each.

Barry Llewellyn, a director and co-founder of Newsplayer, said the issue had raised more than £740,000. He said this would be enough to tide it over until the increased revenues which have been forecast kicked in. Last month, the company signed a two-year agreement with NTL which will generate subscription and advertising revenue. It also expects to complete the acquisition of US company, Global Media Services .

GMS is an audiovisual hosting, distribution and rights management company which offers email-based direct marketing. The deal should be completed this summer and make Newsplayer profitable by the end of the year.

The company has claimed a refund of £205,000 in research and development tax from the Inland Revenue. The claim, if successful, will give a further boost to its cashflow.

Mr Llewellyn said: "We've cut our operational costs considerably, and we will shortly start to enjoy the benefits of our more diversified revenue streams."

Newsplayer recently announced that annual losses had doubled to £3.46m. This was despite a cash injection by Sir David in December when he agreed to extend a £160,000 convertible loan to the company and forgo £150,000 of royalties. Sir David already has 2m free share options exercisable at 50p up to 2011.

Newsplayer owns the internet distribution rights to ITN and Reuters news archives, EMI music videos and 40 years of Sir David's TV interviews, which include six prime ministers and six US presidents. However, the group, which relies on customers accessing its archives over the internet, suffered from the slow take-up of broadband services.

Shares in the group, which floated at 84p in 2000, were unchanged last night at 4.5p.