11th May 2006 07:01
Timestrip PLC11 May 2006 TIMESTRIP PLC PRELIMINARY RESULTS FOR THE YEAR ENDED 31 DECEMBER 2005 Timestrip Plc ("Timestrip") develops, manufactures and sells patented Timestrip (R) smart labels which monitor for how long perishable food and other replaceable products have been open or in use. Key points: •Results in line with expectations •Significant progress achieved towards commercialising Timestrip's technology •Deals and alliances have been announced during the period under review with; •Nestle •Bayer •Hamilton Beach/Proctor Silex •Labellord •Bioconservacion •Further discussions and trials underway with major international companies. •Steady progress across core targeted international markets •Directors confident of further progress in the year ahead Paul Freedman, Timestrip's joint CEO commented:- "Timestrip has made steady progress during the period under review and I amconfident of further success in the year ahead as we accelerate our targetmarkets' awareness and the benefits of the Timestrip technology. Recent wins,such as Nestle, will continue to underpin our marketing strategy and I lookforward to updating shareholders with further progress shortly". For further information: Paul Freedman, Joint CEO and founding Director, Timestrip 01462 440 700Shane Dolan, Biddicks 020 7448 1000Fergus Marcroft, Evolution Securities 020 7071 4300 CHAIRMAN'S STATEMENT The last year has been one of great transition for your Company as it emergedfrom a Creditors' Voluntary Arrangement to acquire Timestrip UK Limited andraising £4.5 million through two share placings to fund the commercialisation ofits unique smart label technology, the Timestrip(R). The Timestrip(R), which enables the measurement of lapsed time, has beendeveloped for use, initially, for the food, pharmaceutical and other consumablegoods industries. We have made significant advances with the technology and alsobegun to get real traction with potential users, as is evidenced by the dealsand alliances that have been formed with, amongst others, Nestle, Bayer,Hamilton Beach/Proctor Silex, and Labellord. We are also in a number of otherdiscussions and trials with major international companies. Financial Results In financial terms, we remain at a very early stage of our development. Turnoverfor the year ended 31 December 2005 amounted to £103,303 (2004 - £0), resultingin a loss before tax of £1,259,035 (2004 - £33,942). Our financial resourcesremain in robust health. Cash at the end of the year stood at £2,979,268 whilethe exercise of placing warrants in April 2006 has increased net cash by afurther £867,384. Staff I would like to convey the Board's sincere appreciation for the huge effortsbeing made by everyone involved in our exciting business - not only ourdedicated and professional team in the UK and Israel who are so committed to ourgoal of becoming a household name across the globe, but also to our advisors whohave guided the Company through a time of great transition. Current Trading and Prospects In the current year we have continued to promote the Timestrip(R) technology andare pleased to report that we now have a number of opportunities, which yourBoard is confident will lead to commercial relationships during the course of2006 and beyond. As is described in the Operating Review below, Timestrip(R)labels have become an integral part of manufacturers packaging in both the foodand non-food consumable industries and your Board is confident that, asconsumers and markets become ever more aware of freshness and product age andwith the increasing influence of legislation, Timestrip will continue to gaintraction within its chosen markets. Stephen OakesChairman11 May 2006 JOINT CHIEF EXECUTIVES' STATEMENT Operating Review The Timestrip(R) label has applications for a number of industrial sectors andwe are making good progress in our chosen operating markets: Catering and Food Services The main highlight in this sector is the successful launch of the Labellord(R)-Timestrip(R) in foodservice markets in Benelux and Germany. Since theirappointment, NSD/Labellord have marketed Timestrip(R) as a food safety solutionrelevant to the recently introduced EU Food Hygiene Legislation. The foodcelebrity, Rob Geus, regularly promotes Timestrip(R) on television and in print,and a concerted advertising campaign, funded by Labellord, is quickly payingdividends. Timestrips are now part of the Bunzl product range in this region andwe are delighted that Labellord have recently secured a deal with Metro, aleading wholesaler in Germany with over 100 outlets, who will stock a range ofLabellord food safety products that will include five unique product lines ofthe Timestrip(R). We have already received orders from Labellord in 2006 thatexceed total turnover for the Group in 2005 and we expect this trend to continueas the year progresses with increasing numbers of wholesalers selling theproduct in Europe. Our search continues for similar distribution agreements inSouthern Europe but we are experiencing slower than expected progress in NorthAmerica, where different marketing challenges are being actively addressed. Food We are delighted that Nestle have decided to adopt the Timestrip(R) technologyas a standard packaging feature on the Maggi(R) range of sauces in the UKFoodservice business. This is an important confirmation that our technology is acost-efficient packaging solution that is delivering benefits to brand ownersand end-users alike. We look forward to building on this success both within theNestle organisation and within the industry in general. Retail Packs: Ocado have been re-ordering retail packs of Timestrips(R) productfor sale online and have confirmed that they will expand the range to includefreezer and room temperature Timestrips(R) later this year. Our success withOcado, while modest in terms of revenue for the Company, is opening doors toother retail opportunities. We have recently received an order from John LewisPartnership in the UK and have been approached by a number of leadinginternational brands wishing to explore co-branded retail launches in NorthAmerica and in Europe. Recent consumer surveys and trends towards fresher and healthier food give usmuch cause for optimism in this sector. Non-food Consumables Filters: since our announcement in November 2005, Hamilton Beach have not onlylaunched the TrueAir(R) device featuring an integrated Timestrip(R), but alsorecently announced the launch of another device that is a co-brand venture withFebreze(R), an internationally recognised household brand from Procter & Gamble.(http://www.trueair.com/press_room/febreze.html). Shipments have also commencedto Bioconservacion S.A., who have launched their filter device in the Fagor(R)brand of fridges in Europe. Development projects: work has escalated on our project to integrate ourtechnology into a household product with near-universal usage and we will reporton progress with consumer trials in due course. The Company also recently won asignificant development contract with a leading international consumer brand tointegrate a version of our technology into a new mass-market product planned forlaunch in 2007. Pharmaceuticals All previously announced projects continue and we are pleased to report that aleading pharmaceutical company has tested and recently approved their Timestrip(R) samples as "fit for purpose". This is an important step towards achievingour objective of high profile long-term supply contracts with mass-marketinternational brands. Medical Devices, Cosmetics, Personal Care Our previously announced development project continues on ways to integrate ourtechnology into a range of devices used in hospitals, although progress in thissector is predictably quite slow. We have identified opportunities for theTimestrip(R) technology within the National Health Service and we will report onthe progress of discussions in due course. Since the announcement of our ability to produce a one year Timestrip(R) we havereceived a high level of interest from cosmetic/personal care product companieswho are looking at the opportunity presented by Timestrip(R) in relation torecently introduced EU labelling regulations. Paul Freedman Reuben IsbitskyJoint Chief Executive Officer Joint Chief Executive Officer11 May 2006 11 May 2006 TIMESTRIP PLCPRELIMINARY STATEMENTUNAUDITED RESULTS FOR THE YEAR ENDED 31 DECEMBER 2005 CONSOLIDATED PROFIT AND LOSS ACCOUNT Unaudited Audited 12 months 12 months ended ended 31 December 31 December 2005 2004 GBP GBP '000s '000s Turnover 103 -Cost of sales (66) - ----------- -----------Gross Profit 37 - -Administration costs (1,346) (34)Amounts written off investments - -Interest payable (5) -Other operating income 55 - ----------- -----------Loss on Ordinary Activities before Taxation (1,259) (34)Taxation 94 - ----------- -----------Loss on Ordinary Activities After Taxation (1,165) (34)Dividend - - ----------- -----------Retained loss (1,165) (34) ----------- ----------- Basic and diluted earnings per ordinary share (0.49)p (0.12)p TIMESTRIP PLCPRELIMINARY STATEMENTUNAUDITED RESULTS FOR THE YEAR ENDED 31 DECEMBER 2005 CONSOLIDATED BALANCE SHEET Unaudited Audited Unaudited Audited Group Company 2005 2004 2005 2004 GBP GBP GBP GBP '000s '000s '000s '000s Fixed assets Investments - - 6,527 -Intangible assets 6,339 - - -Tangible assets 304 - - - -------- ------- -------- --- ------- 6,643 - 6,527 - -------- ------- -------- --- ------- Current assets Stock 66 - - -Debtors 195 3 2,654 3Cash 2,979 - 1,588 - -------- ------- -------- --- ------- 3,240 3 4,242 3 Creditors: amountsfalling due within oneyear (222) (15) (70) (15) -------- ------- -------- --- -------Net currentassets/(liabilities) 3,018 (12) 4,172 (12) Creditors: amountsfalling due over one year (67) - - - -------- ------- -------- --- -------Net assets/(liabilities) 9,594 (12) 10,699 (12) -------- ------- -------- --- ------- Capital and reserves Called-up share capital 3,603 3,551 3,603 3,551Share premium account 26,588 15,869 26,588 15,869Reserves (20,597) (19,432) (19,492) (19,432) -------- ------- -------- --- ------- 9,594 (12) 10,699 (12) -------- ------- -------- --- ------- Shareholders' Funds Equity 6,050 (3,556) 7,155 (3,556)Non-equity 3,544 3,544 3,544 3,544 -------- ------- -------- --- ------- 9,594 (12) 10,699 (12) -------- ------- -------- --- ------- TIMESTRIP PLCPRELIMINARY STATEMENTUNAUDITED RESULTS FOR THE YEAR ENDED 31 DECEMBER 2005 CONSOLIDATED CASH FLOW STATEMENT Unaudited Audited 12 months ended 12 months ended 31 December 31 December 2005 2004 GBP GBP '000s '000s Net cash outflow from operating activities (1,294) (2,222) Returns on investment and servicing of finance Interest received 55 -Interest paid (5) - ------------ ------------Net cash outflow from returns oninvestments and servicing of finance (1,244) (2,222) Taxation Tax recovered 80 - Capital expenditure and financial investmentPayments to acquire fixed assets &intangible assets (137) - ------------ ------------Net cash outflow for capital expenditureand financial investment (1,301) - Acquisitions and disposalsNet cash acquired from subsidiaryundertakings 43 - ------------ ------------Net cash outflow before financing (1,258) - Financing Issue and purchase of ordinary shares 4,522 2,222Share issue expenses (273) -Repayment to long term bank loan (12) - ------------ ------------Net cash inflow from financing 4,237 2,222 ------------ ------------ ------------ ------------Increase in cash in the period 2,979 - ------------ ------------ TIMESTRIP PLCPRELIMINARY STATEMENTUNAUDITED RESULTS FOR THE YEAR ENDED 31 DECEMBER 2005 NOTES TO CONSOLIDATED CASH FLOW STATEMENT Unaudited Audited 12 months ended 12 months ended 31 December 31 December 2005 2004 GBP GBP '000 '000 Net cash outflow from operating activities Operating loss (1,309) (34)Depreciation and amortisation 317 -Increase in stocks (8) -(Increase)/decrease in debtors (48) 7Decrease in creditors (246) (2,195) ------------ ------------ (1,294) (2,222) ------------ ------------ Reconciliation of net cash flow to movement innet funds Increase in cash 2,979 -Loans acquired with subsidiary (81) ------------ ------------Movement in net funds 2,898 - ------------ ------------ Opening funds - - Closing funds 2,898 - ------------ ------------ TIMESTRIP PLCPRELIMINARY STATEMENTUNAUDITED RESULTS FOR THE YEAR ENDED 31 DECEMBER 2005 Notes 1. Basis of consolidation The consolidated profit and loss account and balance sheet include the financialstatements of the company and its subsidiary undertakings made up to 31 December2005. The results of Timestrip UK Limited have been included from the date ofacquisition on 25 February 2005. 2. Goodwill, patents and trademarks Goodwill is the difference between the amount paid on the acquisition ofTimestrip UK Limited and the aggregate fair value of its separable net assets.Goodwill, patents and trademarks are capitalised and classified as an intangibleasset on the balance sheet. The directors have concluded that goodwill arisingon the acquisition of Timestrip UK Limited should be amortised over its usefuleconomic life of 20 years. Patents and trademarks are also amortised over theiruseful economic life which is estimated to be 20 years. 3. Share capital On 25 February 2005, the company acquired the entire issued share capital ofTimestrip UK Limited for a consideration of £6.4 million. The purchase price wassatisfied by the issue of 160,000,000 new Ordinary Shares of 0.02p each at 4pper share to the vendors on the sale of their Timestrip UK Limited shares. Furthermore on 25 February 2005, 50,581,250 new Ordinary Shares of 0.02p wereissued pursuant to a placing to raise a total of £2,023,250 before expenses. On 12 October 2005, 40,000,000 new Ordinary Shares of 0.02p were issued to raisea total of £2,400,000 before expenses. On 19 October 2005, 624,999 new Ordinary Shares of 0.02p were issued to raise atotal of £37,500 before expenses. On 23 November 2005, 166,666 new Ordinary Shares of 0.02p were issued to raise atotal £10,000 before expenses. On 6 December 2005, 5,000,000 new Ordinary Shares of 0.02p were issued at par. On 6 December 2005, 6,250,000 new Ordinary Shares of 0.02p were issued in favourof £50,000 convertible loan stock. 4. Dividends No dividend is proposed for the period ended 31 December 2005. 5. Taxation No taxation is expected to arise on the results for the period. 6. Loss per Share The loss per share for the year ended 31 December 2005 has been calculated onthe basis of the loss after taxation for the period of (£1,165,036) (2004: £(33,942)) and the weighted average number of shares in issue during the periodof 237,871,611 (2004: 28,484,103). 7. Information on Timestrip Timestrip has developed a patented smart label, the Timestrip(R), which enablesusers of perishable food and other products to monitor for how long an item hasbeen open or in use. The Timestrip(R) is a disposable multi-layer laminatedlabel which contains a timing device consisting of a specialised porous materialand a non-toxic liquid. Upon squeezing the label to activate, the liquid startsto move through the porous material by micro-capillary action. A printedcalibration on the top layer of the label allows the user to tell at any pointin time how long the label has been active. The label is currently manufacturedwith adhesive backing enabling it to be attached to perishable goods as areminder to use or replace the product. The label is designed to be easilycustomised and is capable of being embedded into the product packaging or theproduct itself. It can be activated automatically either upon first opening thepackage or upon first use of the product. The solution provided by Timestrip relates to the difficulty in monitoringrelative expiry dates, such as "Use within two weeks of opening". The Timestrip(R) addresses this problem by reliably monitoring the lapse of time, providing avisual indication that the relative expiry date is approaching, thereby givingthe user the opportunity to manage perishable items in a way that was previouslyproblematic. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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