28th Feb 2007 07:03
CareCapital Group plc28 February 2007 CareCapital Group Plc ("CareCapital" or "the Group") Audited Preliminary Results for the year ended 31 December 2006 CareCapital Group Plc, a developer and investor for the long term in healthcarerelated properties throughout the UK and in Germany, is pleased to announce itspreliminary results for the year ended 31 December 2006. Group Financial Highlights •Admission to AIM on 4 August 2006 •First time adoption of International Financial Reporting Standards ("IFRS") •Profit Before Tax ("PBT") of £1.7 million (2005:loss £295k) •Completed property acquisitions/developments during the year of £6.06 million. •Group rental income up 12 % to £1.34 million (2005:£1.2 million) •Portfolio value up 38 % to £29.5 million (2005: £21.4 million) •Adjusted diluted Net Asset Value ("NAV") per share increased by 25 % to 21.25p (2005:17.85p)* •Significant development pipeline *Adjusted diluted NAV per share - excludes deferred tax on property portfoliorevaluation. Calculated on an equivalent basis for 2005. Dr. Michael Sinclair, Chairman, commented: "I am pleased to report that 2006 was a year of significant progress forCareCapital Group Plc in that the Group was admitted to AIM in early August andis reporting its results for the first time under IFRS. This, in my view,provides a realistic measurement of the value of the portfolio and the progressthat has been made over the past twelve months. Our pipeline of UK developments is being progressed to plan and we continue toidentify further opportunities for long term healthcare related real estateinvestment. We have also made our initial investment in Germany as part of a plannedprogramme of both acquisitions and developments in that country." For further information, please contact: CareCapital Group Plc Daniel Stewart & Co. Plc Tavistock CommunicationsPaul Stacey, Chief Executive Lindsay Mair, Simon Hudson,Steve Wilden, Finance Director Director, Corporate Finance Richard Sunderland Tel: 020 7034 1949 Tel: 020 7776 6550 Tel: 020 7920 [email protected] [email protected] [email protected]@carecapital.co.uk [email protected] CHAIRMAN'S STATEMENT I am pleased to present to you CareCapital Group Plc's 2006 ("CareCapital")final results which have been prepared using International Financial ReportingStandards ("IFRS"). 2006 held particular significance for the Group, being the year that its shareswere admitted to AIM in early August. At the end of 2006, the Group ownedproperties valued at £29.5 million (2005 restated: £21.4 million). Profitsbefore tax for the year ending 31st December 2006 totaled £1.7m (2005 restated:loss £295k). Profits after tax (including a deferred taxation charge of £1.03m)amounted to £678k (2005 restated: loss £383k). Revaluation of the Group's property portfolio at 31.12.06 resulted in avaluation surplus of £3.5m. CareCapital places great emphasis on the fact that it is both a developer andinvestor in health care real estate. As such, we can provide our tenants and thesponsoring NHS Authorities with the security of knowing that the partneringrelationships created during the development process are continued through theproject's life. This also makes good commercial sense. Government policy in both the UK and other European countries places increasingemphasis on the importance of primary care within the community as being thefocus of their attention and a means of providing cost effective, timely andappropriate healthcare services. Increasingly, primary care buildings encompassa broad range of healthcare services, including physicians, nurse practitioners,pharmacy, dental care, day surgery and many others. The current UK Government initiatives such as Practice Based Commissioning andAlternative Provider Medical Services should result in the expansion of currentservices, to include a mixed economy of provision and therefore a wider range oftenants in our buildings. As a result, CareCapital has been involved in 2006,and will be in the future, in the development of extensions of its existingportfolio of properties and new properties of increasing scale and complexity.The existence of available land attached to a number of our existing portfolioproperties has proved to be a significant asset in this regard. In December 2006 the Group made its first move outside the UK through thepurchase of a 4,500 sq m medical centre in Germany. As has previously beenannounced, we plan to acquire further similar investments and develop newmedical buildings within the German market. Whilst being attractive real estateinvestments in their own right, this geographical expansion augments the Group'sexpertise in developing and managing the polyclinic style of building which isoccupied by a broad range of medical specialists. We believe that this modelwill become increasingly applicable within the UK market. During 2007 andthereafter we anticipate growth outside the UK to match that within it. We have 9 properties currently under development in the UK. We expect 4 of thesedevelopments to reach completion within the coming 24 months, with a totalestimated developed value of £14 million. A further 5 projects with ananticipated developed value of £37.3 million are scheduled for completion beforethe end of 2009. In addition, the Group has a significant number of identified pipeline projectopportunities that will be progressed over the coming months. We will continueto pursue new development opportunities both by direct negotiation and throughpublic sector competitive tendering. Rent reviews agreed during 2006 produced an average increase of 14.84 %. Whilstthere is no certainty that this increase can be maintained, the figure doesreflect, we believe, the high quality of our developed portfolio. The market for primary care properties is both growing and competitive.CareCapital's position as both a developer and investor for the long termprovides its partners in the public sector with the assurance of a long termrelationship. In this way, the Group seeks to differentiate itself from othersin the Industry. The combination of this growing market, readily availablefinance and our experienced and dedicated team of executives, enables us to lookforward to the future with confidence. DR. MICHAEL J. SINCLAIR27 February 2007 CHIEF EXECUTIVE'S REPORT Activities The Group's principal activities are the development of and investment inhealthcare related properties, predominately in the Primary Care Sector. Itconducts its business activities throughout the UK and in Germany and securesdevelopment and investment opportunities through both direct negotiation andcompetitive tendering. As reported in the Chairman's Statement, the Group was listed on AIM in August2006 and has adopted IFRS for its results for this year. The Group's revenues are derived from the rents receivable on its investmentproperties and the income from the provision of facilities management servicesrelated to those properties. Additionally, a margin is applied to the cost ofdevelopments; the recovery of this margin being used to offset those overheadand other costs not directly attributable to the development. During 2006 the Group completed the extension to its medical centre in Hinckley;commenced construction of a dental centre in Folkestone and completed theacquisition of a medical centre in Berlin. In addition, a joint venture in whichthe Group is a 50% participant was selected as the preferred bidder for amedical centre development in North Wales. A number of further developments arebeing progressed, all of which are anticipated to be completed by the end of2009. Property Portfolio The Group has 21 long-term investment properties which are valued at £29.5million at 31 December 2006 (2005: £21.4 m.). There were commitments at the endof 2006 of £5.9 million in respect of projects under construction andacquisitions. 9 new developments are being progressed that have a projected cost of £43.4million. These development projects are all scheduled for completion before theend December 2009. Disposals There were no disposals during the year. However, it has been decided to sellthe property in Southampton following the cessation of the contract withSouthampton University Hospitals NHS Trust to provide patient hotel servicesfrom that building. Considerable interest in the property has been received andit is anticipated the sale will be completed before the end of April 2007. Revaluation As reported in the Chairman's Statement, the property portfolio has beenrevalued as at 31 December 2006. This revaluation reflects both the rent reviewssuccessfully concluded during the year and a hardening of investment yields. Theresult is an uplift in the portfolio valuation of £3.5 million (2005: £281k)which has been incorporated into the balance sheet. This increase amounted to anuplift in value per share of 4.6 pence; 4.3 pence per share on a fully dilutedbasis. Rental Levels The current overall average rent receivable across the portfolio is £138 persquare metre. The UK overall average rent per square metre is £156; in Germanythe average is £102 per square metre reflecting the lower land values andconstruction costs in that country. On a blended basis the current average rents per square metre receivable bytenant category are as set out below: Medical Practitioners - £135.03NHS Authorities - £163.95Pharmacies - £186.51Dentists - £112.32Others - £128.57 Tenants occupation of Portfolio PropertiesThe occupation of the Group's properties by tenant category expressed as apercentage of floor area is as follows: Medical Practitioners - 78.30%NHS Authorities - 7.02%Pharmacies - 4.65%Dentists - 4.91%Others - 5.13% Tenants by Annual RentsThe table below sets out an analysis of the portfolio in terms of rent roll bytenant category. Over 99% of tenants are directly involved in the delivery ofhealthcare services: Medical Practitioners - 76.61%NHS Authorities - 8.34%Pharmacies - 6.28%Dentists - 3.99%Others - 4.78% Security of income by lease term certainAnalysis of rental income by lease term certain Period in years % of rents receivable Under 10 years 11.24%10 - 15 years 3.83%15 - 20 years 35.69%20 - 25 years 31.16%Over 25 years 18.08% Rent Reviews6 rent reviews were completed during 2006 resulting in an uplift in rentsreceivable of £46,011; an average increase of 14.84% on the applicable rents. 2further reviews relating to 2006 are currently under negotiation. The table below sets out the future rent review pattern by annual rent: Rent Review Annual rent subject % of currentTiming to review Annual Rent 0 - 1 year £558,262 33%1 - 2 years £231,500 14%3 - 4 years £426,468 25%4 - 5 years £74,998 4%Over 5 years £416,216 24% Development FinancingThe Group increased its long-term borrowings by £1.64 million during the year to31 December 2006, net of the repayment of an investors loan of £2.86 million onlisting. Debt financing of investment properties is sourced from a panel ofbanks and other financial institutions on a project by project basis. Interestrate risk is managed through the use of hedging instruments or long term fixedrate borrowing. Further information on the Group's financing arrangements isprovided in the Notes to the Financial Statements for the year to 31 December2006. PAUL STACEY27 February 2007 CareCapital Group Plc Consolidated income statement for the year ended 31 December 2006 Audited Audited 2006 2005 Restated Notes £ £---------------------------------------------------------------------------------------------- Revenue 1,832,013 1,747,651---------------------------------------------------------------------------------------------- Cost of sales (83,560) (72,719)---------------------------------------------------------------------------------------------Gross profit 1,748,453 1,674,932 Administrative expenses (2,352,192) (1,353,167)---------------------------------------------------------------------------------------------- (603,739) 321,765Other operating income 251,418 -Net surplus on revaluation of investment properties 3,528,023 281,165---------------------------------------------------------------------------------------------- Operating profit before exceptional items 3,175,702 602,930Exceptional costs of AIM listing 3 (589,574) 0---------------------------------------------------------------------------------------------- Operating profit after exceptional items 2,586,128 602,930 Finance income 186,608 244,545Finance costs (1,094,027) (1,155,424)Change in fair value of financial instruments 29,081 12,528----------------------------------------------------------------------------------------------Net finance costs (878,338) (898,351)---------------------------------------------------------------------------------------------- Profit/(Loss) before tax 1,707,790 (295,421) Taxation (1,029,967) (88,108)---------------------------------------------------------------------------------------------- Profit /(Loss) for the period attributable to equity shareholders 677,823 (383,529)---------------------------------------------------------------------------------------------- Basic earnings per share 2 0.93p (0.54)p-----------------------------------------------------------------------------------------------Diluted earnings per share 2 0.92p (0.54)p----------------------------------------------------------------------------------------------- Weighted average number of shares (000') 2 73,544 70,696 CareCapital Group PlcConsolidated Balance Sheet As at 31 December 2006 Audited Audited 2006 2005 Restated Notes £ £-----------------------------------------------------------------------------------------------Non - current assets Intangible assets 1,751,959 1,751,959Investment properties 29,517,118 21,427,961Development properties 504,916 64,217----------------------------------------------------------------------------------------------- 31,773,993 23,244,137 Plant and equipment 28,156 46,868 31,802,149 23,291,005Current assets Inventories - 1,200Trade and other receivables 567,160 379,331Cash and cash equivalents 2,321,933 6,955,128Financial instruments 206,781 ------------------------------------------------------------------------------------------------Total Current Assets 3,095,874 7,335,659 Non current assets classified as held for sale 1,500,000 ------------------------------------------------------------------------------------------------Total assets 36,398,023 30,626,664----------------------------------------------------------------------------------------------- Current liabilitiesTrade and other payables (1,091,623) (686,078)Tax liabilities (292) (292)Borrowings, including finance leases (365,801) (355,539)Derivative financial instruments (99,495) (128,576)-----------------------------------------------------------------------------------------------Total Current Liabilities (1,557,211) (1,170,485) Non - current liabilitiesBorrowings, including finance leases (18,511,279) (13,983,065)Loan from investor - (2,857,092)Deferred tax provision (2,249,127) (1,453,356)----------------------------------------------------------------------------------------------- (20,760,406) (18,293,513) Liabilities directly associated with non current assets held for sale (702,735) ------------------------------------------------------------------------------------------------Total liabilities (23,020,352) (19,463,998)-----------------------------------------------------------------------------------------------Net assets 13,377,671 11,162,666----------------------------------------------------------------------------------------------- EquityShare capital 5 767,541 706,958Reverse acquisition reserve 11,038,204 11,038,204Share option reserve 143,055 63,956Share premium account 1,397,500 -Profit and Loss account 31,371 (646,452)-----------------------------------------------------------------------------------------------Total equity 13,377,671 11,162,666----------------------------------------------------------------------------------------------- These consolidated financial statements have been approved by the Board of Directors on 27thFebruary 2007. P.Q.C Stacey S.K. WildenChief Executive Finance Director CareCapital Group PlcConsolidated statement of changes in equity Share Reverse Share Share options Acquisition Accumulated Total capital Premium reserve Reserve Losses Equity Notes £ £ £ £ £ £ Balance at 1 January 2005 706,958 - 4,857 11,038,204 (262,923) 11,487,096Share based payment - value of employee services - - 59,099 - - 59,099 Profit for the year - - - - (383,529) (383,529)-------------------------------------------------------------------------------------------------------------------- Balance at 31 December 2005 706,958 - 63,956 11,038,204 (646,452) 11,162,666 Balance at 1 January 2006 706,958 - 63,956 11,038,204 (646,452) 11,162,666Issue of new shares 5 10,583 - - - - 10,583Issue of share capital - public placement (net) 5 50,000 1,397,500 - - - 1,447,500Share based payment - value of employee services - - 59,099 - - 59,099Share based payment - value of services received - - 20,000 - - 20,000Profit for the year - - - - 677,823 677,823--------------------------------------------------------------------------------------------------------------------Balance at 31 December 2006 767,541 1,397,500 143,055 11,038,204 31,371 13,377,671-------------------------------------------------------------------------------------------------------------------- CareCapital Group PlcConsolidated cash flow statement forthe year ended 31 December 2006 Audited Audited 2006 2005 Restated £ £---------------------------------------------------------------------------------------- Cash flows from operating activitiesprofit/(loss) after taxation 677,823 (383,529)Adjustments Taxation 1,029,967 88,108Change in fair value of financial instruments (29,081) (12,528)Finance costs 1,094,027 1,155,424Finance incomes (186,608) (244,545)Unrealised net revaluation gains on investment properties (3,528,023) (281,165)Depreciation 33,005 33,916Write off of development properties 40,261 -Share based payments 79,099 59,099---------------------------------------------------------------------------------------- Cash flows from operations before changes in working capital (789,530) 414,780Change in inventories 1,200 -Change in trade and other receivables (187,829) (114,941)Change in trade and other payables 405,544 (3,365)----------------------------------------------------------------------------------------Cash (used)/generated from operations (570,615) 296,474Interest paid (1,094,027) (1,016,068)----------------------------------------------------------------------------------------Cash flows from operating activities (1,664,642) (719,594)---------------------------------------------------------------------------------------- Cash flows from investing activitiesPurchase of investment property (6,058,524) -Capital expenditure on development properties (481,960) (651,504)Purchase of plant and equipment (14,293) (28,280)Interest received 186,608 244,545----------------------------------------------------------------------------------------Cash flows from investing activities (6,368,169) (435,239)---------------------------------------------------------------------------------------- Cash flows from financing activitiesNew mortgage loans raised (Net) 4,817,059 196,581Repayment of finance leases (18,434) (18,435)Repayment of investors'loan (2,857,092) -Proceeds on issue of new shares 1,458,083 -----------------------------------------------------------------------------------------Cash flows from financing activities 3,399,616 178,146---------------------------------------------------------------------------------------- Net decrease in cash and cash equivalents (4,633,195) (976,687)Cash and cash equivalents at 1 January 6,955,128 7,931,815----------------------------------------------------------------------------------------Cash and cash equivalents at 31 December 2,321,933 6,955,128---------------------------------------------------------------------------------------- NOTES: 1. Principal accounting policies (a) Accounting convention and basis of preparation These financial statements have been prepared in accordance with InternationalFinancial Reporting Standards as adopted by the European Union ("IFRS") for thefirst time, and with those parts of the Companies Act 1985 applicable tocompanies reporting under IFRS.The financial statements have been prepared underthe historical cost convention modified to include the revaluation of investmentproperties and properties available for sale. A summary of the more important group accounting policies is set out below,together, where relevant, with an explanation of where changes have been made toprevious policies on the adoption of new accounting standards in the year. (b) Change in accounting policies Prior to the adoption of IFRS the financial statements of the CareCapital Groupof companies had been prepared in accordance with United Kingdom AccountingStandards ("UK GAAP"). UK GAAP differs in certain respects from IFRS and certainaccounting and valuation methods have been amended, when preparing thesefinancial statements, to comply with IFRS. The comparative figures in respect of2005 have been restated to reflect these amendments. (c) Basis of consolidation The consolidated financial information includes financial information in respectof the company and its subsidiary undertakings, which were all wholly owned at31 December 2005 and 31 December 2006. The results of subsidiaries acquired or disposed of during the year are includedin the consolidated income statement from the effective date of acquisition orup to the effective date of disposal, as appropriate. All intra-group transactions, balances, income and expenses are eliminated onconsolidation. On 31 July 2006, the Company became the legal parent of Care Capital Limited("CCL") by way of a share exchange agreement. According to the share exchangeagreement, the shareholders of CCL transferred the entire issued share capitalof CCL to the Company in consideration for 706,957,760 ordinary shares at par of 0.1p each. This business combination is regarded as a reverse acquisition whereby CCL, thelegal subsidiary, is the acquirer and has the power to govern the financial andoperating policies of the legal parent so as to obtain benefits from itsactivities. As a consequence of applying reverse acquisition accounting, the results for theyear ended 31 December 2006 comprise the full year results of CCL for the yearended 31 December 2006 plus those of the Company from 31 July 2006, the date ofthe reverse acquisition, to 31 December 2006. The comparative figures are thoseof CCL for the year ended 31 December 2005. (d) Goodwill Goodwill arising on acquisition of group undertakings is carried as anintangible asset at cost less accumulated impairment losses. Impairment reviewis carried out annually. Any impairment is recognised immediately in profit orloss and is not subsequently reversed. Goodwill arising on acquisitions before the date of transition to IFRSs has beenrestated retrospectively in accordance with IFRS 3 Business Combinations. (e) Investment properties Investment properties are properties owned or leased by the group which are heldfor long term rental income and for capital appreciation. Investment property isinitially recognised at cost and revalued at the balance sheet date to fairvalue as determined by the directors. In arriving at their assessment, thedirectors take advice from professionally qualified external valuers on thebasis of fair market value. Gains or losses arising from changes in the fair value of investment propertyare included in other operating income in the income statement of the period inwhich they arose. Depreciation is not provided in respect of investmentproperties. (f) Development properties Properties under development and land are initially recognised at cost. Costincludes external interest on development loans, directly attributable outgoingsand development margin representing the recovery of attributable internaloverheads. No development margin is ascribed to a project until the point offinancial close or contractual agreement is reached. Upon completion, development properties to be held for long term rental incomeand capital appreciation are transferred to investment property. (g) Non-current assets held for sale Non-current assets classified as held for sale are measured at the lower ofcarrying amount and fair value less costs to sell. The fair value is the openmarket value, according to estimates received from external professionalvaluers. Non-current assets are classified as held for sale if their carrying amount willbe recovered through a sale transaction rather than through continuing use.Management is committed to the sale which should be expected to qualify forrecognition as a completed sale within one year from the date of classification. (h) Revenue recognition Revenue consists of gross rental income received on investment properties andfacilities management income in respect of a patient hotel. Rental income iscalculated on an accruals basis and recognised in the accounting period to whichit relates. Additional rental amounts occurring owing to rent reviews are notrecognised until agreed in writing. (i) Exceptional items Exceptional items are those significant items which are separately disclosed byvirtue of their size or incidence to enable a full understanding of the group'sfinancial performance.. (j) Income taxes The charge for current taxation is based on the results for the year as adjustedfor items which are non-assessable or disallowed. It is calculated using ratesthat have been enacted or substantively enacted by the balance sheet date. Deferred tax is provided using the balance sheet liability method in respect oftemporary differences between the carrying amount of assets and liabilities inthe financial statements and the corresponding tax bases used in computation oftaxable profit with the exception of deferred tax on revaluation surpluses wherethe tax basis used is the accounts historic cost. Deferred tax is determined using tax rates that have been enacted orsubstantially enacted by the balance sheet date and are expected to apply whenthe related deferred tax asset is realised or the deferred tax liability issettled. It is recognised in the income statement except when it relates toitems credited or charged directly to equity, in which case the deferred tax isalso dealt with in equity. Deferred tax assets are recognised to the extent that it is probable that futuretaxable profit will be available against which the temporary difference can beutilised. Deferred tax assets and liabilities are offset only when they relate to taxeslevied by the same authority, with a legal right to set off and when the groupintends to settle them on a net basis. 2. Earnings per share----------------------------------------------------------------------------------------- Group Group 2006 2005 Restated----------------------------------------------------------------------------------------- Basic earnings per share------------------------Basic earnings per share is calculated by dividing the profitattributable to equity holders of the Company by the weightedaverage number of ordinary shares in issue during the year. Profit/ (loss) attributable to equity holders of the Company (£) 677,823 (379,771) ----------------------- Weighted average number of ordinary shares in issue (thousands) 73,197 70,696 ----------------------- Earnings/ (loss) per share (pence per share) 0.93 (0.54) ----------------------- Diluted earnings per share--------------------------The Company has one category of dilutive potential ordinary shares - share options. A calculation is undertaken to determine the number of shares that could have been acquired at fair value based on the monetary value of the subscription rights attached to outstanding share options. It is compared with the number of shares that would have been issued assuming the exercise of the share options. 2006 2005 Profit/ (loss) attributable to equity holders of the Company (£) 677,823 (379,771) ----------------------- Weighted average number of ordinary shares in issue (thousands) 73,197 70,696 Adjustment for share options (thousands) 347 -Weighted average number of ordinary shares for diluted earnings(thousands) 73,544 70,696 ----------------------- Diluted Earnings/ (loss) per share (pence per share) 0.92 (0.54) ----------------------- Adjusted earnings per share---------------------------Adjusted earnings per share have been calculated to exclude the unrealisedgain on revaluation of investment properties and fair value movement on derivative financial instruments. 2006 2005 Profit/ (loss) attributable to equity holders of the Company (£) 677,823 (379,771) Less gain on revaluation of investment properties (3,528,023) (281,165) Add deferred tax in respect of investment properties 1,058,407 84,350 Add fair value movement on derivative financial instruments 29,081 12,528 Less deferred tax in respect of derivative financial instruments (8,724) (3,758) -----------------------Earnings/(loss) used for calculation of adjusted earningsper share (1,771,436) (567,816) ----------------------- Adjusted earnings per share (2.42) (0.80) No adjusted, diluted earnings per share is calculated because the Group made lossesafter the adjustments. 3. Exceptional costs----------------------------------------------------------------------------------------- 2006 2005 Restated £ £----------------------------------------------------------------------------------------- External costs associated with the listing of the group on theAlternative Investment Market ("AIM") 589,574 ------------------------------------------------------------------------------------------ The group incurred costs of £ 642,074 in connection with its listing on AIM ON4th August 2006, including a share based cost attributed to an option granted to the Company's brokers. Of the total, £52,500 being the commission on the raising of new money, has been applied to the share premium account. 4. Net asset value----------------------------------------------------------------------------------------- 2006 2005 Restated Net assets per share (basic) (pence per share) 17.4 15.8-----------------------------------------------------------------------------------------Net assets per share (diluted) (pence per share) 16.7 15.3----------------------------------------------------------------------------------------- 5. Share capital----------------------------------------------------------------------------------------- 2006 2005 Authorised:500,000,000 ordinary shares of 1p each (100,000 ordinary shares of 100p each) 5,000,000 100,000-----------------------------------------------------------------------------------------Issued and fully paid:76,754,096 ordinary shares of 1p each (2 ordinary shares of 100p each) 767,541 2----------------------------------------------------------------------------------------- On 9 June 2006, the authorised share capital of the Company was increased to £5,000,000 and each issued and unissued ordinary share of £1 each was subdivided into 1,000 ordinary shares of 0.1p each pursuant to a specialresolution. Number Nominal of shares value £ 15 September 2005Issue of subscriber shares of £1 each on incorporation 2 2 9 June 2006 (2) -Subdivision of shares into 2,000 ordinary shares of 0.1p each pursuant to special resolution 2,000 - 31 July 2006Issue of new ordinary shares of 0.1p each for cash at par 10,581,200 10,581 31 July 2006Issue of new ordinary share of 0.1p each pursuant to acquisition of CareCapital Limited pursuant to share exchange agreement. 706,957,760 706,958 31 July 2006Consolidation of every 10 ordinary shares of 0.1p each into (717,540,960) -1 ordinary share of 1p each pursuant to special resolution 71,754,096 - 4 August 2006Issue of new ordinary shares by way of shares placement 5,000,000 50,000-----------------------------------------------------------------------------------------Ordinary shares in issue at 31 December 2006 76,754,096 767,541----------------------------------------------------------------------------------------- As a consequence of applying reverse acquisition accounting (see note 1), the Group share capital for the comparative period has been presented as £706,958 to reflect the shares issued in exchange for the share capital of CareCapitalLimited. Options to subscribe for Ordinary Shares of 0.1p eachOn 1 December 2004, seven employees of CareCapital Ltd were granted options to subscribe for an aggregate of 630,000 ordinary shares of £1 each in CareCapitalLtd at a subscription price of £1 per share. On 31 July 2006 option replacementdeeds were entered into such that the seven employees surrendered theiroptions in exchange for the grant of options to subscribe for an aggregate of 4,271,436 new Ordinary 0.1p shares in the Company at a subscription price of 15p per share. These options vest in four tranches as follows: 1/12/04 1,017,009 options, 1/12/05 1,067,859 options, 1/12/06 1,067,859 options and 1/12/07 1,118,709 options. These options are exercisable at any time between 1/12/07 and 1/12/ 14. As these options were granted after 7 November 2002 they are accounted for in accordance with IFRS 2. On 31 July 2006, the Company's brokers, Daniel Stewart & Co, were granted, conditional on admission, the right to subscribe for up to 767,540 new ordinaryshares, being 1% of the share capital, at 30p per share. In accordance with IFRS 2, this represents a share based payment for services provided, and has beenaccounted for accordingly. 6. The financial information set out above does not constitute the Company'sstatutory financial statements for the years ended 31st December 2006 or 2005(but is derived from and has been prepared on the same basis as the 2006financial statements with the 2005 figures being restated for IFRS). Statutoryfinancial statements for 2005 were prepared under UK Generally AcceptedAccounting Practice and have been delivered to the Registrar of Companies andthose for 2006 will be delivered following the Company's Annual General Meeting.The auditors have reported on those financial statements; their reports wereunqualified and did not contain statements under section 237 (2) or (3) of theCompanies Act 1985. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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