9th Nov 2006 17:48
Crosby Capital Partners Inc09 November 2006 CROSBY CAPITAL PARTNERS INC. ("CROSBY") TRADING UPDATE - NINE MONTHS TO 30 SEPTEMBER 2006 9 November 2006 Crosby announces its trading figures for the nine months ended 30 September2006. HIGHLIGHTS Financial • Operating loss for the year to date of US$48.1 million (Q3 2005: US$73.2 million profit). • Loss attributable to shareholders of US$43.0 million (Q3 2005: US$71.3 million profit). • Interim dividend: Nil (Q3 2005: US$0.05 per share) Business • Merchant Banking: Two transactions have been announced to themarket - offers for Marathon Resources Limited (ASX: MTN) and Orchard PetroleumLimited (ASX:OPL) ; • Asset Management: New fund will be launched in the comingmonths, and continued progress in the Group's Wealth Management operations; • IB Daiwa: Kami well producing gas and condensate; Darcyoperations progressing well; Plum Deep drilling approaching target depth;drilling at Endeavor to commence this month; pre-drilling analysis andengineering and design work almost completed for Big Mouth sidetrack; Importantmanagement progress made on operational and regulatory compliance Simon Fry, Chief Executive Officer, commented that: "The results for the three and nine months ended 30 September 2006 are a directreflection of the decline in the IB Daiwa share price over the period, givenCrosby's significant holding in IB Daiwa which is marked to market in accordance with IFRS (see Note 1 below for further details). Indeed, the lossesof US$113.3 million for the third quarter, i.e. the three months ended 30September 2006, were largely attributable to the movement in the share price of IB Daiwa which led to a unrealised negative mark to market of over US$100million in the third quarter, as the share price closed at Y90 on September30th compared to Y206 on June 30th. This reversed the positive mark to marketgain on IB Daiwa for the six months ended 30 June 2006. This recent decline in the share price of IB Daiwa has been heavily influencedby a continuing sharp correction of the Jasdaq market and other small capindices in Japan and the falls in the price of oil and gas over the same period.However, despite the recent decline in the share price of IB Daiwa, Crosby'sholding is still valued at a significant premium over the original cost of itsinvestment. At Crosby, we remain committed to our investment in IB Daiwa and supportive ofthe continued transformation of its business, and the development of its oiland gas reserves and exploration prospects. Indeed, over the last quarter therehas been considerable progress at IB Daiwa with both the further strengtheningof the IB Daiwa management team and also progress at the operational level inits two wholly owned subsidiaries, Lodore Resources and Darcy Energy. In respect of Lodore Resources, we expect drilling at Endeavor to begin this monthand Plum Deep should reach its target drilling depth. Also, we hope to seeDarcy Energy becoming more acquisitive in the next 12 months, with a view to further enlarging the already significant reserves it has built up in the recentpast. I believe the recent delays encountered in bringing parts of IB Daiwa's oil andgas portfolio into production (specifically the delays at Darcy), as detailedin our announcement dated 29 September 2006, are of a short-term nature andhave no bearing on the quality of the portfolio, nor on its long term earningspotential. Drilling at Plum Deep (where Lodore has a 37.5% working interest) isprogressing well, as indicated in the recent announcement by the operator(Golden Gate Petroleum). I look forward to reporting further progress as thebusiness develops. More broadly, our operations continue to grow and expand. The Merchant Bankingdivision has been active, with the prospect of at least one more significantdeal becoming public in the next few months, as well as progress on the two transactions that are currently in the public domain (Orchard Petroleum andMarathon Resources). As mentioned in previous statements, Crosby Asset Management is an importantpart of the business that is being developed. We have recently startedmarketing a major new fund to the market. This will add to the breadth and diversity of our fund management businesses, which continue to benefit from thestrength of the Wealth Management business in Asia. Finally, I would like to take this opportunity to thank our shareholders fortheir continued support and our management and staff for their undiluted focusand their dedication." About Crosby Capital Partners Crosby Capital Partners Inc. is a leading independent deal-focused Asia-orientedmerchant banking and asset management group. www.crosby.com For further information on Crosby please contact: Simon Fry, Chief Executive Officer on +44 20 7590 2800Martin Angus, Chief Financial Officer on +44 20 7590 2800 Notes 1. Crosby owns, through two wholly owned subsidiaries, 102,425,000 shares(24.02%) of the issued share capital of JASDAQ listed IB Daiwa. The holdingshave remained unchanged from the 2006 Interim Report of Crosby and areclassified as 'financial assets at fair value through profit or loss' and are,therefore, marked to market with gains and losses being recognised in the incomestatement. The closing share prices at 30 June 2006 and 30 September 2006 were Y206 and Y90 respectively. Trading Summary Unaudited Unaudited nine months ended nine months ended 30 September 30 September 2006 2005 Note US$'000 US$'000 Turnover/Revenue 6,429 5,892Gain on financial assets at fairvalue through profit or loss - 86,066Other income 2,022 492 --------- ---------Total income 8,451 92,450 Loss on financial assets at fairvalue through profit or loss (25,164) -Administrative expenses (26,343) (14,207)Distribution expenses (49) (126)Other operating expenses (4,386) (4,066)Finance costs (628) (802) --------- ---------(Loss)/Profit from operations (48,119) 73,249 Gain recognised from negativegoodwill 959 -Share of (losses)/profits ofassociates / jointly controlledentity (168) 368 --------- ---------(Loss)/profit before taxation (47,328) 73,617 Taxation (133) (115) --------- --------- (Loss)/profit after taxation (47,461) 73,502 Minority interests 4,492 (2,185) --------- --------- (Loss)/profit attributable toequity holders of parent company (42,969) 71,317 ========= ========= Dividends- 2006: Nil (2005: Interim dividend of US$0.05 per share based on 239,350,000shares) - 11,968 ========= =========(Loss)/earnings per share - Basic (17.72 cents) 30.20 cents ========= =========- Diluted N/A 28.92 cents ========= ========= This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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