22nd May 2006 09:21
3DM Worldwide PLC22 May 2006 3DM Worldwide plc Preliminary results for the year ended 31 December 2005 3DM Worldwide plc ("3DM" or "the Group") is a developer and holder of theintellectual property rights to a polymer-based powder impression moulding ("PIM") process Chairman's Statement The past year has been one of considerable change at 3DM, as the group hasprogressed from a phase of extensive Research & Development work to a periodwhere our focus has moved on to commercialising the PIM process. Results for theyear inevitably reflect the significant costs of our R&D work, together with thecosts of commissioning our Alpha and Beta production lines. I would particularly like to welcome Niall MacKay, who came in as our ChiefOperating Officer at the end of October 2005 and, at the end of last year, wasappointed our Chief Executive Officer. He has made significant changes to themanagement and operational structure and process, establishing the commercialteam at our new head office in Bedwas House, bringing in an international salesteam, which is already achieving results, and providing a sharper commercialfocus to the group's activities. The awareness of the PIM process is being raised with a structured marketingplan which has already seen the website re-launched, multi-lingual brochuresproduced and 3DM attending a series of exhibitions. During the year one of the founding forces behind 3DM, Peter Aylmore took on aconsultancy role, having moved on to running a company which holds a licencefrom 3DM. Peter Oldham has had some significant problems with his health, but Iam pleased to say that he is back working as our Operations Director, and isresponsible for the Bedwas facility, where our Alpha and Beta production linesare now fully operational. The research and development phase has seen the intellectual property portfoliobroadened with new patent applications made, a number of patents granted as wellas the development and technical commissioning of a PIM manufacturing process.New applications for PIM have been explored and our understanding of how thevarious blends of virgin and recycled polymers behave within the PIM process andthe resultant properties they impart to the finished moulded product has movedon significantly. Whilst to date it is disappointing to have received limited income from licences3DM is now in a good position to fully commercialise the PIM process. As aresult I believe that the Company is now in a much stronger position than it wasat the time it was admitted to AIM in October 2002. To complete the move from R&D to a fully commercial organisation the Group hasalready begun to be restructured with the closure of a number of dormantcompanies. This will add focus and provide greater transparency to thecompany's activities. My special thanks are due to all the staff who have so loyally worked with thecompany through the research and development phase. I now believe that it is time for a new management team to take over the runningof the Company. Having already stepped down from executive management and nowbeing solely involved in a non-executive capacity, I intend to step down fromthe board by the end of this financial year. The search for my successor is inhand and this will allow for a smooth hand over of the Chairmanship of theboard. The search for further non executive directors is also underway tostrengthen the team. I believe as strongly as ever in the potential for 3DM's technology. I amconfident that under Niall's leadership we will increasingly see the fullcommercial potential of the PIM Process realised and value for the shareholdersdelivered, all of which allows me to look to the future of 3DM with considerableconfidence. KEN W. BROOKSChairman 22 May 2006 ENQUIRIES: College Hill 020 7457 2020Gareth DavidAnthony Parker 3DM Worldwide plc Preliminary results for the year ended 31 December 2005 Operational Review As explained in the Chairman's Statement, the Group has moved on from the R&Dphase, and is now in a position to commercialise the PIM process. Completion ofthe technical commissioning of the Alpha line in mid November has provided thefoundations for the company to enter into commercial discussions with a numberof clients. The fully operational production line provides the ability todemonstrate on a commercial scale the PIM process to its full potential. Strategy The business model remains to sell licences for the PIM process. The best wayto demonstrate the commercial viability of this new technology is to have afully functioning showcase factory. 3DM will look to fully utilise the Alphaline in Bedwas House on contract manufacture and in the production of marketingsamples. Product design and development has been commissioned by a number ofclients, with prototype moulds being produced for testing and to providemarketing samples. Following a review of the market, 3DM will focus on three key sectors where theboard considers potential for the PIM process is the greatest: • Construction • Materials Handling • Automotive Products The Group will target, wherever possible, higher margin products, where the PIMprocess has significant advantages over traditional methods of manufacture,offering solutions to clients who can remain in control of their own productsand costs through enhanced product design features. The Sales and Marketing functions have been successfully integrated, providingglobal coverage for minimum overhead, with facilities and expertise in the UKand USA also integrated. New marketing materials have been produced, withmulti-lingual brochures and a new sales-focused web-site now in place. Significant progress has been made in seeking commercial partners, particularlyin Asia, with a network of agents already established covering China, Hong Kong,Korea, Taiwan, Australia, New Zealand, Poland, Czech and Slovakian Republics,the Baltic States, Greece, Cyprus and the Emirates. The development of thisnetwork, coupled with existing licence holders, has significantly increased theglobal marketing reach for the PIM process with significant interest alreadybeing generated with proposals and full quotations for production facilitiesalready being made. In April of this year 3DM exhibited at Chinaplas 2006, inShanghai, generating 298 enquiries. Meetings are already planned to follow upwith the interested parties. Construction Sector 3DM exhibited at Ecobuild, generating significant interest, particularly in theability to re-use waste plastics, as environmental factors come more to the forein construction. Subsequently 3DM has joined Build Off Site, theGovernment-sponsored body responsible for driving change in constructionmethods. The Group also attended Interbuild at the National Exhibition Centre inBirmingham last month. We have commissioned a suite of moulds to produce a range of sheet materials foruse in the building industry. Value Plastics Technologies LLC (VPT) in the USAhas produced the first of these moulds. The remainder will be put to tenderwith mould manufacturers in the UK. Discussions are already at an advancedstage with a number of potential customers and we hope to be able to reportlater in the year that some of these discussions have progressed to orders. Silkwood Financial Corporation Inc.(Silkwood) Work is underway to develop a construction system utilizing the PIM process heldunder the Silkwood licence. Silkwood is in discussion with Royal BuildingSolutions in the USA to determine if the PIM technology can replace its currentbuilding system/sheet material. The original agreement with Silkwood provided for the production of modularhousing, construction and building products and components using the PIM processin the territory of the Americas. The agreement provided for 3DM to receive 10%royalty fees (based on the value of PIM products used in the construction of thehouse) or a minimum royalty fee which increases year on year, whichever is thegreater. To date Silkwood has paid the first year's royalty fees totallingUS$1.0 million and a further US$0.51m representing reimbursement of research anddevelopment expenses. The relationship with Silkwood is managed through GlobalTechnologies Inc. (GTI) which is entitled to 10% of the royalty fees paid bySilkwood to 3DM over and above the minimum royalty fee. Silkwood intended to begin by building modular homes in Mexico and laterexpanded its projects with plans to build homes in the USA. It is ourunderstanding that the two houses that have been constructed have only used alimited quantity of PIM products. Silkwood has recently changed ownershiphaving been sold to Grosse Pointe Mortgage and Financial Services Limited.Further development work is required before significant quantities of PIMproducts can be used in the Silkwood homes. During 2005 it became increasingly obvious that the agreement with Silkwood wasrestricting 3DM in negotiations with other parties interested in obtaininglicences for the PIM process within the Americas. 3DM has therefore been indiscussions with Silkwood to re-negotiate the licence restricting the territoryto the NAFTA region and reducing the product range to housing and constructionproducts designed expressly by or for Silkwood and the Royal System (RoyalBuilding Solutions). I am pleased to report that agreement has been reached,resulting in the minimum royalty fee being reduced to $500,000 per annum witheffect from 1 January 2005 over the remainder of the licence period endingDecember 2008 Originally it was intended that the Silkwood houses be made primarily of plastic(as are the houses for the Horn of Africa project which is described below).However, manufacturing problems on the part of the subcontractor led to thedecision by Silkwood to use the Royal system. Although work is continuing ondeveloping the use of PIM materials in the Royal system where sheet material canbe used to form the inner and outer skins of a concrete wall and Silkwoodintends under the new ownership to construct houses utilising the PIM technologyas far as possible. It remains uncertain when development will be complete andtherefore when royalty payments will exceed the minimum royalty payment. Geomatrix Development work continues on building products for Geomatrix Inc. under anagreement first announced on 29 March 2004. VPT has, and continues to develop arange of prototype products for approval by Geomatrix's own customers, whichinclude companies such as Home Depot and Lowe's. Production, which will triggerminimum royalty payments, depends on approval by Geomatrix's customers. As yetno final approval has been received and production has not yet commenced. Horn of Africa project Modular and disaster relief housing, where 3DM owns a number of designs thathave been registered in the USA and are in due process, is an ideal product forthe PIM process, where the large scale mouldings and insulation properties ofthe material provide significant advantages. A sample house commissioned forthe Horn of Africa has now been completed and can be viewed on the Company'swebsite. The patent application announced on 13 September 2005 is stillprogressing. The licensee responsible for this project has plans to sell suchhouses in a number of countries and it is anticipated that this will clearlydemonstrate the potential of PIM in the market for temporary low-cost housing.3DM will receive a 10 per cent royalty payment of all sales made by thelicensee. Kingspan Group plc (Kingspan) On 7 February 2005 it was announced that it had been agreed to jointly developbuilding products using the PIM process with Kingspan. We have been working onreducing costs of certain building products and we are in discussions on howbest to take this work forward. Other Building Products On 3 September 2003 3DM announced its first UK licence deal with an unnamed UKbuilding product manufacturer. The products identified under this agreementhave been reassessed for contract manufacture on the Alpha line and have notproved commercially viable. Work on this project has now ceased. Materials Handling Sector Product development work is underway on a range of mobility ramps, withprototype moulds being created. If satisfactory samples are produced, contractmanufacture of the ramps is expected to begin in Q3, 2006. Interest in the potential use of the PIM process to produce plastic pallets hasresulted in the publication of proposals for production facilities in the FarEast to a number of interested parties. 3DM has received a purchase order for the design and development, on a time andmaterials basis, of a prototype container for use in air freight. On successfulacceptance of the designs it is anticipated that samples will be commissioned totest the product in the market place. PIM products are significantly morerobust than the aluminium containers currently in use and therefore will be lessprone to damage. 3DM Nordic AS, the licencee for material handling products in the Scandinaviaand Baltic region paid the initial licence fee of US$250,000. The first annualroyalty payment of US$250,000 falls due at the end of this month. However, 3DMWorldwide plc is currently in discussions with 3DM Nordic AS over an extensionto the scope of the licence which may affect the schedule of royalty payments. Discussions are currently underway with 3DM Nordic AS regarding the manufactureof a prototype mould for plastic pallets produced using the PIM process andpotential contract manufacture utilising the alpha line in Bedwas House. 3DM Nordic AS is an independent company registered in Norway, 3DM Worldwide plcholds no interest in this company. M Sideris & Sons Ltd has a representation and commission agreement for Greece,Cyprus and the United Arab Emirates. The Sideris family also now owns all of3DM Materials Handling Ltd (a Cyprus registered company) which holds adevelopment licence for pallets within certain dimensions. This company hasbeen independently developing pallets under this licence. The appropriateprototype moulds have been manufactured and product is being tested. 3DM has manufactured a prototype mould for a roll cage for The Rollet Company.Details of the roll cage can be found on our website. Samples produced from themould are being used for marketing purposes across Europe. 3DM is at an advanced stage of technical and commercial discussions with aninternational company expanding their specialist recycling operation intoEurope. This would take the polymer element of the recycled containers, convertthis into a feed stock for the PIM process and produce finished products forsale back to the original manufacturers of the containers, thus providing atruly sustainable product cycle. Automotive Sector The board believes that the automotive sector could become a major market forthe PIM process. The Company received verbal confirmation in February 2006 that the lightweightcomposite test pieces produced for a major automotive OEM in the USA in 2005successfully passed the customer testing requirements. This has led tocommercial discussions being entered into, as well as potential development workand prototype moulding for other components. Tipping Truck bed Progress on the project to install PIM produced truck beds into Dodge Dakotatrucks stalled in negotiation last year due to issues over changes in theproduction bed design, the royalty rate and mainly the lack of anapplication-specific granted patent. That US patent, number 7,032,977, has nowbeen granted. To date some 50 beds have been manufactured and 10 of the prototypes were soldas a dealer type-fit generating income of US$5,000. The patent now granted covers all composite tipping truck beds .This willdemonstrate the strength of the intellectual property and will enable GTI torecommence negotiations with the distributor. 3DM is entitled to a royalty ofUS$500 from GTI on all units sold under any distribution agreement secured byGTI. GTI is responsible for managing this project on behalf of 3DM and isentitled to any profit it makes over and above the 3DM royalty payment. Tyre Sensors We are delighted to report that a US patent, number 7,034,672, has been grantedin respect of a tyre sensor attached to a composite wheel. (The wheel would bemade using the PIM process). 3DM has a non exclusive licence from Transense Technologies plc for the sale ofits surface acoustic wave sensor when attached to a wheel. 3DM has granted asub-licence to GTI for sale of this product in the NAFTA region. Additional projects Tanzania The previously announced project for a production line in Tanzania, based onEuropean Union funding, continues to progress. Unfortunately the project hassuffered delays in obtaining the funding, due to the changes in personnel withinthe Tanzanian government as a result of recent elections. We hope that fundingwill be forthcoming in the second half of this year allowing the granting of alicence for the production of modular housing and other construction relatedproducts. The development of this project will then recommence. 3DM will be entitled to a royalty of 10%. The licensee, which was originally tobe 3DM Africa Limited, will be an independent company, in which 3DM will have nodirect interest. PipeHawk plc As announced over REACH on 28 March 2006, 3DM has been commissioned to developanti-ballistic composite PIM materials, for use by PipeHawk plc in constructionof its mine clearance system MineHawk. Early stage research has commenced intoanti ballistic materials in the USA by VPT with encouraging results. Highseas Technologies Limited (HST) On 24 November 2003 3DM announced the granting of a licence to HST for themanufacture of certain marine products using the PIM process, being initially 60foot boats and 12 foot RIBs. While HST did commission a large mould based ontheir in-house design these products have not been developed. During 2005 HST came under new management and the focus has changed to smallerand, in our view, more commercially viable products. Accordingly the licenceagreement in place with HST has been extended within the European Union to covera range of smaller products including sail and surf boards, small boats, buoys,fenders, life raft containers, pedaloes and sun beds. 3DM will receive 10%royalty from the sale of HST products. The change in management and strategy hascaused a delay in product development. Under the original agreement HST owed 3DM a minimum royalty payment for threeyears. The terms for the extended licence terminate the minimum royalty payment from31st December 2005. Although to date 3DM received no cash from HST, pro-rataincome of £187,500 was accrued in 2004 as 3DM had the right to convert theamount owed in to HST shares. HST was planning at the time to float on AIM. Wenow understand that these flotation plans have now been indefinitely postponed. 3DM has taken the strategic decision not to hold shares in licensees andaccordingly if we exercise our right to convert the amount owed into shares wewill divest ourselves of such holdings to maintain a transparent arm lengthposition in the future. Given the present position of HST and its change of direction we believe thebest way forward is for 3DM not to allow for any royalty income in 2005 and wehave provided for the accrued income from 2004. This is further discussed inthe Financial Review below. Licensing of the PIM process Negotiations are underway to expand the existing licence base with a currentlicence holder in Europe and for the granting of new licences in South America,China and the Middle East. It is anticipated that these negotiations willconclude in Q4 of 2006. To facilitate these negotiations, a settlement has beenreached to reduce the scope of the existing Silkwood licence to NAFTA countriesfor modular housing and building components and this is described above and inthe Financial Review below. Group Structure In view of the complexity of the existing group structure, and to achievegreater transparency, the Group will be re-organised during the current year,with all trading activity undertaken through 3DM Worldwide plc's subsidiary, 3DMGroup Limited. 3DM Worldwide plc will be the legal entity for holding the bankof intellectual property. The only exceptions to this rule will be where asubsidiary company is required for a specific project. During 2006, 3DM will look to divest itself of a number of shareholdingsincluding its 20% holding in Highseas Technologies Limited. The option topurchase Environmental Polymer Technologies Limited (formerly 3DM EnvironmentalLimited) has not been exercised but in its place 3DM has acquired an option topurchase three specific recycling technologies which complement the PIM customeroffering. There was no further consideration for the transfer of the option. Investments will be restricted to where there is a strategic logic tomaintaining a strong relationship and the group intends to retain the following: Medical Waste Solutions (MWS) MWS provides and operates technology to convert high plastic content hospitalwaste into an inert feedstock material. This material can be used in the PIMprocess or alternatively put to landfill at a greatly reduced volume and cost.A plant has been established and licenced by the Environmental Agency inBradford. MWS is working on an EU Life Environment funded project to developthe plant in Bradford further and to establish a second plant in Latvia. Access to this technology allows 3DM to offer to its clients products whichutilise their own waste and provide a closed loop and hence a fully sustainableproduct. So far this material has only been used in the PIM process to producesamples. The existing debt of £300,000 owed by MWS to 3DM for capital equipmentand consultancy is being converted into equity and will give 3DM a 15.0% holdingin the business. Longborough Capital plc (LBC) 3DM has a 14.9% holding in LBC (which owns GTI), which has a range of tyresensors. These, including via GTI, the Transense Tyre Sensor, are for use inthe automotive industry. These sensors offer significant cost savings andimprovements in reliability on existing products. LBC has two licensing dealsalready in place. In addition the company also has under development asulphination process, which can be used with polymers to provide ananti-microbial barrier or to allow the polymer to accept a surface finish suchas metal plating or paint. The sulphination process has a wide range ofapplications and has a strategic fit with the PIM process. Value Plastics Technologies LLC (VPT) 3DM will retain its current 20% holding within VPT, which continues to undertakeresearch into polymer technologies. Intellectual Property During 2005, further patents have been granted for the PIM process and relatedproducts. These include the core patent for the PIM process, UK (patent numberGB2388336B) and Singapore (patent number 102188), both announced in June 2005 ,as well as the blow moulding technology which gives the company its name (USpatent number 6663822) granted in December 2003 and subsequently in China(patent number ZL00805413.4) in September 2005. A specific application patentfor the tipping composite truck bed has now been granted in the USA. Inaddition, the company continues to file patent applications where it believes acommercial advantage can be achieved. Future Technology Developments Initial development work has been undertaken on a production process for themanufacture of large diameter pipes as a replacement for concrete pipes.Considerable interest in this process has been shown, particularly in the FarEast. It is anticipated that the development phase of this project will run tothe end of 2007. Looking further ahead, we still anticipate that work will commence on developingthe commercial application of the blow moulding technology in 2007/08. Moving Forward The PIM process has generated considerable interest across the globe forrelatively little marketing activity. The intellectual property is strong and,with the advances in our understanding of the relationship between the product,mould and materials, 3DM is now in a strong position to fully capitalise oncommercialising this opportunity. While it is rare to find a process with such a wide range of applications thefocus for the remainder of 2006 is to fill the Alpha Line in Bedwas House withcontract manufacturing and to progress the licensing opportunities currentlyunder discussion. At this stage the key to realising the full potential of thecompany is to deliver the key projects to a high level of professionalism. 2006is already lining up to be a busy year! I am greatly looking forward to cementing the foundations already in place,leading the business into profitability and building value for our shareholders. NIALL MACKAYChief Executive Officer 3DM Worldwide plc Preliminary results for the year ended 31 December 2005 Financial Review Results Turnover in 2005 was £0.41 million compared to £0.78 million. The consolidatednet operating loss was £4.6 million, up from £2.8 million in 2004. Consolidatedlosses before tax were £4.6 million compared to losses of £4.0 million in 2004. Dividends and loss per share No dividend payment is proposed. The loss per share was 6.81 pence compared to 6.02 pence in 2004. Thereremained 5.0 million warrants and 4.4 million shares under option at the yearend which have exercise prices in excess of the current price and are thereforeassumed to result in no dilution of capital or earnings per share. Trading Turnover included royalties from Silkwood and a proportion of licence incomewhich is taken to income over the expected life of the licence of three years. Cost of sales covers material purchases for the Alpha and Beta lines used incommissioning and the production of samples. Administration expenses totalled £5.1 million compared to £3.7 million in 2004.They include all research and development costs, all operating costs associatedwith the running of the Alpha and Beta lines at Bedwas House, corporate expensesand the legal costs associated with securing the ongoing intellectual propertyassets. As reported last year, the Company expected to receive the final payment ofUS$0.75 million for the sale of the remaining investment in the Kyrgyz Republicby 31 March 2006. In addition, until the consideration had been fully satisfied,the Company was entitled to receive a royalty of US$0.10 per kilogram of woolprocessed. No payment has been received and therefore no income has beenreflected in this years accounts. There has been a regime change within the Kyrgyz Republic and it is now apparentthat the new Government is actively questioning the validity of all transactionscarried out by the previous administrators. It is therefore uncertain that theremaining monies will be forthcoming and the Company has therefore made aprovision for £392,186 to cover this. Silkwood Under the original licence agreement signed with Silkwood, the Company wasentitled to a minimum royalty payment of US$1 million in 2004 rising to US$2million in 2005 and to US$3 million in 2006. During the year several newopportunities arose for the PIM process, which were restricted by theterritorial coverage of this licence. As a result, negotiations took place to redefine the territorial limits of thelicence and the products covered to enable the Company to exploit its potential. The outcome has been a revised agreement concluded 21 May 2006 which reducesthe minimum royalty of the licence to US$0.5 million per annum and this has beenreflected in turnover. Highseas Technologies Limited (HST) Under the original licence agreement signed with HST, the Company was entitledto a minimum royalty payment of £250,000 per annum. A pro-rata amount of£187,500 was accrued in the 2004 accounts. No accrual has been made in 2005 foroutstanding royalties and a provision against the 2004 accrual has been made asno payment has been received from HST. Closure of subsidiary 3DM Tech Inc. was closed during the year and the intellectual property wastransferred to 3DM Worldwide. Financing The Alpha line was financed by a £2.9 million loan repayable over a ten yearperiod. A separate facility was arranged for the Beta line of £0.34 million over a threeyear period. Before the year end, the Company entered into a convertible loan note withCornell Capital Partners, L.P. (Cornell) and Montgomery Equity Partners L.P.(Montgomery) to provide a £4.75 million draw down facility. Cornell andMontgomery can require the Company to repay up to £150,000 per week of theoutstanding balance of the loan in cash or for shares at any time (at theCompany's option) over a 24-month period. The Group can opt to repay all or part of the loan at any time during the24-month period in cash or for shares. The issue price of any such shares isbased on the lower of the average price of the Company's shares during the tendays prior to issue. As of 15th May 2006, £750,000 has been redeemed by theissue of 3,648,864 shares at an average price of 20.55 pence per share.In orderto minimise financing costs £3.04 million of this facility has been used torepay short term borrowings. The previous un-drawn equity line of credit for £5m remains available until 4September 2006. DAVID SHEPLEY-CUTHBERT Finance Director 3DM Worldwide plc UNAUDITED CONSOLIDATED PROFIT AND LOSS ACCOUNTYEAR ENDED 31 DECEMBER 2005 Year Ended Year Ended 31 December 2005 31 December 2004 £'000 £'000 Turnover Continuing operations 405 783 405 783 Cost of sales (113) (48) Gross profit 292 735 Administrative expenses (5,103) (3,692) Other operating income 236 152 Operating Loss Continuing operations (4,575) (2,805) Loss on disposal of subsidiary - (761) (4,575) (3,566) Foreign currency gains/(losses) 247 (464) on investments Interest receivable - 36 Interest payable (296) (8) Loss on ordinary activities (4,624) (4,002) before taxation Tax on loss on ordinary 75 - activities Loss on ordinary activities after (4,549) (4,002) taxation Loss per share Basic and diluted loss per (6.81) p (6.02) p ordinary share Loss per share excluding loss on (6.81) p (4.88) p disposal of subsidiary 3DM Worldwide plc UNAUDITED CONSOLIDATED BALANCE SHEET 31 DECEMBER 2005 31 31 December December 2005 2004 £'000 £'000 Fixed Assets Intangible assets 11,996 12,590 Tangible assets 5,158 2,642 Investments 565 565 17,719 15,797 Current Assets Debtors 2,080 2,069 Cash at bank 4,507 86 6,587 2,155 Creditors: amounts falling due within one year (9,751) (1,721) Net current (liabilities)/assets (3,164) 434 Total assets less current liabilities 14,555 16,231 Creditors: amounts falling due after more than one year (3,073) - Net Assets 11,482 16,231 Capital and reserves Called-up equity share capital 1,670 1,668 Share premium account 29,992 29,958 Share option reserve 45 34 Profit and loss account (20,225) (15,429) Equity shareholders' funds 11,482 16,231 3DM Worldwide plc UNAUDITED CONSOLIDATED CASH FLOW STATEMENTYEAR ENDED 31 DECEMBER 2005 31 December 2005 31 December 2004 £'000 £'000 Net cash outflow from operating (3,492) (2,264) activities Returns on investments and servicing of finance Interest received - 36 Interest paid (271) (8) Net cash (outflow)/inflow from (271) 28 returns on investments and servicing of finance Capital expenditure and financial investment Purchase of tangible fixed (3,313) (2,371) assets Payments to acquire investments - (1,323) Receipts from sale of 145 2,296 investments Net cash outflow from capital (3,168) (1,398) expenditure and financial investment Net cash outflow before (6,931) (3,634) financing Financing Issue of equity share capital 36 3,301 Inception of finance leases 3,320 - Inception of loans 7,776 - Net cash flow from financing 11,132 3,301 Increase/(decrease) in cash 4,201 (333) 3DM Worldwide plc UNAUDITED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES YEAR ENDED 31 DECEMBER 2005 Year Ended Year Ended 31 December 2005 31 December 2004 £'000 £'000 Loss for the financial year (4,549) (4,002) Currency translation differences on (247) 36 foreign currency Total recognised gains and losses relating to the year (4,796) (3,966) 3DM Worldwide plc NOTES TO THE ACCOUNTS UNAUDITED RECONCILIATION OF MOVEMENT IN SHAREHOLDERS' FUNDS Year Ended Year Ended 31 December 2005 31 December 2004 £'000 £'000 £'000 £'000 Loss for the financial year (4,549) (4,002)New equity share capital 2 16Premium on new equity share capital 34 385Movement in share option reserve 11 34Movement in reserves due to foreign (247) 36exchange differences ----------- ------------- (200) 471 --------------- --------------- Net reduction to funds (4,749) (3,531) Opening shareholders' funds 16,231 19,762 --------------- --------------- Closing Shareholders' funds 11,482 16,231 --------------- --------------- 1. The calculation of loss per share is based on the loss of £4,549,107(2004 : £4,001,851) and on 66,771,671 Ordinary shares (2004 : 66,469,702) inissue. 2. The financial statements have been prepared on the basis of the accountingpolicies set out in the Group's statutory accounts for 2005. In respect ofintangible assets and research and development, the intellectual property whichwas purchased in 2001 is being amortised over 20 years. The Company hasconsistently adopted a prudent accounting policy with regard to research anddevelopment generally, writing all these off as expenses through the profit andloss account. The Company also treats all ongoing intellectual property costson the same basis. The research and development costs are expected be recoveredthrough licence agreements. The machine build costs are reflected in the valueof the physical machinery. Assessments for impairment have taken place inaccordance with the group's accounting policy. 3. The financial information set out above does not constitute the company'sstatutory accounts within the meaning of section 240 of the Companies Act 1985.The 2005 figures are based on unaudited accounts for the year ended 31 December2005. The statutory accounts will be finalised on the basis of the financialinformation presented by the directors in the preliminary announcement and whichwill be delivered to the Registrar of Companies following the company's annualgeneral meeting. 4. The 2004 comparatives are derived from the statutory accounts for 2004which have been delivered to the Registrar of Companies and received anunqualified audit report and did not contain a statement under the Companies Act1985, s237(2) or (3). 5. This statement will be made available online at www.3dmworldwide.comand copies will be made available at the Company's registered office, Unit 3Bedwas House, Bedwas House Industrial Estate, Greenway, Bedwas. CF83 8DW. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
ENRT.L