14th Sep 2009 07:00
For Immediate Release:
Environmental Recycling Technologies plc
Interim Results for the six months ended 30 June 2009
Environmental Recycling Technologies plc ("ERT", "the Company" or the "Group") (AIM: ENRT), which has developed and is exploiting the patented rights to the Powder Impression Moulding ("PIM") process capable of converting mixed waste plastics into commercially viable products, announces its unaudited interim results for the six months ended 30 June 2009.
Highlights
For further information:
|
Environmental Recycling Technologies plc |
|
|
Ken Brooks (Chairman) |
|
|
David Shepley-Cuthbert (Finance Director) |
01993 779 468 |
|
Evolution |
|
|
Tim Worlledge |
|
|
Bobbie Hilliam |
020 7071 4300 |
Chairman's Statement
The first six months of this year have seen your Board continue the work of the restructuring begun last year. I am pleased to report that we have made further savings in terms of the overall organisation and our cost base is now very low.
On the commercial front our leading UK licensee, 2K Manufacturing Limited, has acquired its factory site at Luton and has already installed its first machinery there. Your Board believes that the success of 2K will demonstrate the immense potential of our PIM Process technology.
The increasing recycling agenda has led to a considerable number of enquiries and negotiations in respect of the application of the PIM Process in various sectors.
The one major difficulty that remains is the ongoing litigation with the Group's former CEO in Kyrgyzstan. Mr Daley won his original case against the company and unfortunately the Company lost its Appeal, as announced on 23 June 2009. The Company is currently pursuing a separate set of proceedings against Mr Daley and will update shareholders with material developments. Your Board would still prefer an overall settlement through a mediation process and will continue to pursue this route.
I believe your Board is working extremely well with limited resources to achieve the best possible result for shareholders. I am very grateful to my fellow directors for all they do and believe our overall team effort is now producing the results for which shareholders have waited so long.
I am pleased to present to you our unaudited interim results for the six months ended 30 June 2009.
Ken Brooks
Chairman
Managing Director's review
Despite uncertain global economic conditions, there has been significant activity in the waste management and environmental sectors as Governments throughout the world develop strategies to reduce the challenges of the carbon agenda.
We believe this vindicates the Board's decision to rebrand the enterprise and concentrate our efforts in sectors where the unique abilities of the PIM process to utilise high percentages of co-mingled and contaminated plastic waste materials are paramount.
In consequence, the Board is pleased to report that there is significant progress in the commercialisation of the PIM technology and provides the following updates:
2K commenced limited production of its "ecosheet" boards in July at its 62,000 sq ft facility in Luton and is, we understand, nearing completion of their proving period.
There has been significant media interest in 2K's progress, not least from a recent edition of The Economist which has greatly enhanced global awareness of the technology and the ecosheet product.
The Replas project funded by TSB and managed by PERA in cooperation with its industry partners and Brunel University has been extended to enable further development and detailed performance measurement using full scale ecosheet produced by 2K Manufacturing using specific raw material formulations. It is expected that this work will be invaluable in helping to achieve accreditation for ecosheet to meet construction industry standards.
As we reported in the 2008 Annual Report, the Board considered a collaboration with Persico Srl. to be a significant development in the commercialisation of PIM. Persico are a leading manufacturer of rotational moulding equipment and moulds. Like PIM, rotational moulding relies on the introduction of polymer in powder format and so in many ways PIM is a natural development for Persico who see the technology as a USP to enhance their offering to the market, and particularly to promote the use of mixed plastic waste streams.
We are pleased to confirm that Persico are promoting PIM into projects such as ultra lightweight panels for commercial vehicles, drink dispenser panels, and are working with our licensee Highseas Technologies to develop surf board production using PIM.
In the USA we have a non exclusive license agreement with LBOC. Through their subsidiary GTI, an agreement has been reached with Greentech Inc to build a plant which is to include PIM manufacturing in Georgia . We understand that GTI have started to receive purchase orders and that the supply is to be on a turnkey basis. Of course under our out-licensed business model ERT have no input into the specification, or construction of the PIM plant.
The Board believe that the conditions are now ideal to achieve rapid adoption of PIM. The tangible progress at 2K manufacturing and the acclaim which they have quite rightly received in the media, together with the positive developments from the collaboration with Persico and the demand for innovative technologies to satisfy environmental challenges should combine to enable ERT and its loyal shareholders to enjoy the success we believe is deserved.
Roger Baynham
Managing Director
Financial review for the six months ended 30 June 2009
Results
Revenue for the six months ended 30 June 2009 was £321,000 (H1, 2008 £1,000). Other income from grants was £106,000 (H1, 2008 £178,000). The loss on operations was £0.54 million (H1, 2008 loss £1.80 million). Losses attributable to equity shareholders were £0.81 million (H1, 2008 loss £2.00 million).
Dividends and loss per share
No dividend payment is proposed. The basic and diluted loss per share was 0.28 pence compared to 0.78 pence in 2008.
Trading
Turnover included revenue for licences, minimum royalties and pre production units. Other income was made up of grants from the Technology Strategy Board (TSB).
Administrative expenses for the period were £0.97 million (H1, 2008 £1.98 million). No exceptional costs were incurred in the six months (H1, 2008 £0.49 million). The other administrative expenses include third party costs attributable to the TSB project of £0.11 million (H1, 2008 £0.13 million). Excluding the TSB project costs, depreciation and amortisation, the normal overheads incurred in running the company were £0.35 million (H1, 2008 £1.31 million), a significant reduction.
Financing
Total borrowings amounted to £3.11 million compared to £3.13 million at 31 December 2008.
During the period, YA Global Investments Limited ("Yorkville") converted a further £0.18 million into equity reducing the loans outstanding to £1.47 million. In total Yorkville has converted loans and accrued interest totalling £5.37 million at an average price of 4.78p per share.
The Standby Equity Distribution Agreement (SEDA) with Yorkville to the value of £5 million was extended in 2008 and expires in September 2010. Funding facilities, underwritten by the Yorkville facility, have been organised to cover the company's normal overheads for the rest of the year. The company has had commercial discussions with lenders to ensure that existing facilities remain available or will be settled in shares rather than cash. There are currently no reasons to believe that arrangements cannot be made on acceptable terms.
As set out in the Chairman's Statement above, the Company remains in litigation with the Group's former CEO in Kyrgyzstan. The Company has historically provided for legal and settlement costs associated with this litigation, further details of which can be seen in note 6 below. Shareholders should be aware however that the level of compensation being sought under Mr Daley's claim exceeds the present immediate cash resources of the Company.
David Shepley-Cuthbert
Finance Director
Independent review report to Environmental Recycling Technologies plc
Introduction
We have been engaged by the company to review the condensed set of financial statements in the half-yearly financial report for the six months ended 30 June 2009 which comprises the Group Income Statement, Group Balance Sheet, Group Statement of Changes in Shareholders' Equity, Group Cash Flow Statement and the notes 1 to 6.
We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.
Directors' responsibilities
The interim report, including the financial information contained therein, is the responsibility of and has been approved by the directors. The directors are responsible for preparing the interim report in accordance with the rules of the London Stock Exchange for companies trading securities on the Alternative Investment Market which require that the half-yearly report be presented and prepared in a form consistent with that which will be adopted in the company's annual accounts having regard to the accounting standards applicable to such annual accounts.
Our responsibility
Our responsibility is to express to the company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review.
Our report has been prepared in accordance with the terms of our engagement to assist the company in meeting the requirements of the rules of the London Stock Exchange for companies trading securities on the Alternative Investment Market and for no other purpose. No person is entitled to rely on this report unless such a person is a person entitled to rely upon this report by virtue of and for the purpose of our terms of engagement or has been expressly authorised to do so by our prior written consent. Save as above, we do not accept responsibility for this report to any other person or for any other purpose and we hereby expressly disclaim any and all such liability
Scope of review
We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, ''Review of Interim Financial Information Performed by the Independent Auditor of the Entity'', issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the six months ended 30 June 2009 is not prepared, in all material respects, in accordance with the rules of the London Stock Exchange for companies trading securities on the Alternative Investment Market.
BDO Stoy Hayward LLP
Chartered Accountants and Registered Auditors
Birmingham
11 September 2009
Interim Accounts for the Six Months ended 30 June 2009 (unaudited)
The financial information contained within these accounts has been prepared by the Directors who accept responsibility for the financial information presented below and confirm that it has been properly presented in accordance with applicable law. The interim financial statements were approved by the Board of Directors on 11 September 2009 and have been prepared on the basis of the accounting policies set out in note 1. The financial information covers the six months ended 30 June 2009.
Group Statement of Comprehensive Income (unaudited)
|
|
|
|
Six months ended 30 June 2009 |
Six months ended 30 June 2008 |
Year ended 31 December 2008 |
|
£'000 |
£'000 |
£'000 |
|||
|
Continuing operations |
note |
Unaudited |
Unaudited |
Audited |
|
|
Revenue |
321 |
1 |
1,089 |
||
|
Other income |
106 |
178 |
262 |
||
|
Administrative expenses |
|||||
|
Exceptional |
2 |
- |
(491) |
(1,724) |
|
|
Other |
(969) |
(1,488) |
(2,379) |
||
|
Total administrative expenses |
(969) |
(1,979) |
(4,103) |
||
|
Loss on operations |
(542) |
(1,800) |
(2,752) |
||
|
Finance costs |
3 |
(271) |
(195) |
(424) |
|
|
Loss before income tax |
(813) |
(1,995) |
(3,176) |
||
|
Tax on loss on ordinary activities |
- |
- |
- |
||
|
Loss for the period from continuing |
|||||
|
operations attributable to equity shareholders of the parent |
(813) |
(1,995) |
(3,176) |
||
|
Other comprehensive income Available-for-sale assets - gains in period Total other comprehensive income Total comprehensive loss for the period attributable to equity shareholders of the parent |
67 67 (746) |
- - (1,995) |
- - (3,176) |
||
|
Loss per share (pence) |
|||||
|
Basic and diluted loss per share |
4 |
(0.28p) |
(0.78p) |
(1.18p) |
Group Statement of Financial Position (unaudited)
|
Six months ended 30 June 2009 |
Six months ended 30 June 2008 |
Year ended 31 December 2008 |
||||
|
|
|
|
£'000 |
£'000 |
£'000 |
|
|
Assets |
note |
Unaudited |
Unaudited |
Audited |
||
|
Non-Current Assets |
||||||
|
Intangible assets |
10,238 |
11,132 |
10,685 |
|||
|
Plant & equipment |
241 |
142 |
296 |
|||
|
Available-for-sale financial assets |
922 |
- |
855 |
|||
|
Total non current assets |
11,401 |
11,274 |
11,836 |
|||
|
Current assets |
||||||
|
Trade and other receivables |
239 |
1,236 |
228 |
|||
|
Cash and cash equivalents |
1 |
6 |
17 |
|||
|
Total current assets |
240 |
1,242 |
245 |
|||
|
Total assets |
11,641 |
12,516 |
12,081 |
|||
|
Liabilities |
||||||
|
Non-current liabilities |
||||||
|
Borrowings |
5 |
- |
1,841 |
- |
||
|
Total non-current liabilities |
- |
1,841 |
- |
|||
|
Current liabilities |
||||||
|
Trade and other payables |
1,341 |
666 |
1,224 |
|||
|
Borrowings |
5 |
3,109 |
1,495 |
3,128 |
||
|
Provisions |
375 |
545 |
563 |
|||
|
Total current liabilities |
4,825 |
2,706 |
4,915 |
|||
|
Total liabilities |
4,825 |
4,547 |
4,915 |
|||
|
Net assets |
6,816 |
7,969 |
7,166 |
|||
|
Equity attributable to the shareholders of the parent |
||||||
|
Share capital |
7,556 |
6,783 |
7,160 |
|||
|
Share premium reserve |
35,500 |
35,499 |
35,500 |
|||
|
Warrant reserve |
945 |
1,393 |
1,021 |
|||
|
Available-for-sale reserve |
67 |
- |
- |
|||
|
Retained earnings |
(37,252) |
(35,706) |
(36,515) |
|||
|
Total equity |
6,816 |
7,969 |
7,166 |
|||
Group Statement of Changes in Shareholders' Equity (unaudited)
|
Six months ended 30 June 2009 |
Share Capital |
Share Premium |
Warrant Reserves |
Available -for-sale reserve |
Retained Earnings |
Total |
||
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
|||
|
Comprehensive loss for period |
- |
- |
- |
67 |
(813) |
(746) |
||
|
Issue of share capital |
396 |
- |
- |
- |
- |
396 |
||
|
Warrants adjustments |
- |
- |
(76) |
- |
76 |
- |
||
|
Movement for the period |
396 |
- |
(76) |
67 |
(737) |
(350) |
||
|
Balance at 1 January 2009 |
7,160 |
35,500 |
1,021 |
- |
(36,515) |
7,166 |
||
|
Balance at 30 June 2009 |
7,556 |
35,500 |
945 |
67 |
(37,252) |
6,816 |
||
|
Six months ended 30 June 2008 |
Share Capital |
Share Premium |
Warrant Reserves |
Available -for-sale reserve |
Retained Earnings |
Total |
|
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
||
|
Comprehensive loss for period |
- |
- |
- |
- |
(1,995) |
(1,995) |
|
|
Issue of share capital |
473 |
52 |
- |
- |
- |
525 |
|
|
Warrants adjustments |
- |
- |
26 |
- |
(26) |
- |
|
|
Movement for the period |
473 |
52 |
26 |
- |
(2,021) |
(1,470) |
|
|
Balance at 1 January 2008 |
6,310 |
35,447 |
1,367 |
- |
(33,685) |
9,439 |
|
|
Balance at 30 June 2008 |
6,783 |
35,499 |
1,393 |
- |
(35,706) |
7,969 |
|
|
Year ended 31 December 2008 |
Share Capital |
Share Premium |
Warrant Reserves |
Available -for-sale reserve |
Retained Earnings |
Total |
|
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
||
|
Comprehensive loss for year |
- |
- |
- |
- |
(3,176) |
(3,176) |
|
|
Issue of share capital |
850 |
53 |
- |
- |
- |
903 |
|
|
Warrants adjustments |
- |
- |
26 |
- |
(26) |
- |
|
|
Options lapsed |
- |
- |
(372) |
- |
372 |
- |
|
|
Movement for the year |
850 |
53 |
(346) |
- |
(2,830) |
(2,273) |
|
|
Balance at 1 January 2008 |
6,310 |
35,447 |
1,367 |
- |
(33,685) |
9,439 |
|
|
Balance at 31 December 2008 |
7,160 |
35,500 |
1,021 |
- |
(36,515) |
7,166 |
|
Group Statement of Cash Flows (unaudited)
Six months ended 30 June 2009
|
|
|
Six months ended 30 June2009 |
Six months ended
30 June
2008
|
Year
ended
31 December
2008
|
|
|
|
£'000
|
£'000
|
£'000
|
|
|
|
Unaudited
|
Unaudited
|
Audited
|
|
|
|
|
|
|
|
Continuing Activities
|
|
|
|
|
|
Loss before tax
|
|
(813)
|
(1,995)
|
(3,176)
|
|
Adjusted for:
|
|
|
|
|
|
Depreciation on plant and equipment
|
|
56
|
137
|
312
|
|
Amortisation of intangible assets
|
|
447
|
447
|
894
|
|
Finance expense
|
|
226
|
194
|
-
|
|
Fees settled in shares
|
|
45
|
-
|
-
|
|
|
|
|
|
|
|
Adjusted loss from operations
|
|
(39)
|
(1,217)
|
(1,970)
|
|
|
|
|
|
|
|
(Increase)/decrease in trade and other receivables
|
|
(11)
|
(53)
|
48
|
|
Increase/(decrease) in trade and other payables
|
|
91
|
(459)
|
(169)
|
|
(Decrease)/increase in provisions
|
|
(188)
|
-
|
18
|
|
|
|
|
|
|
|
Cash used by operations
|
|
(147)
|
(1,729)
|
(2,073)
|
|
|
|
|
|
|
|
Cash element of finance costs
|
|
-
|
(54)
|
-
|
|
|
|
|
|
|
|
Net cash outflow from operations
|
|
(147)
|
(1,783)
|
(2,073)
|
|
|
|
|
|
|
|
Cash flows from investing activities
|
|
|
|
|
|
Purchase of plant and machinery
|
|
-
|
(2)
|
(2)
|
|
|
|
|
|
|
|
Net cash used in investing activities
|
|
-
|
(2)
|
(2)
|
|
|
|
|
|
|
|
Cash flows from financing activities
|
|
|
|
|
|
Inception of loans
|
|
131
|
1,745
|
2,272
|
|
Repayment of loans
|
|
-
|
(100)
|
(325)
|
|
Interest paid
|
|
-
|
-
|
(1)
|
|
|
|
|
|
|
|
Net increase in cash from financing activities
|
|
131
|
1,645
|
1,946
|
|
|
|
|
|
|
|
Net decrease in cash
|
|
(16)
|
(140)
|
(129)
|
|
Cash and cash equivalents at beginning of period
|
|
17
|
146
|
146
|
|
|
|
|
|
|
|
Cash and cash equivalents at end of period
|
|
1
|
6
|
17
|
Notes to the comprehensive financial statements
1. Accounting policies
Basis of accounting
The principal accounting policies adopted in the preparation of the interim financial statements are set out below.
In the preparation of this Interim Report there have been no changes to the accounting policies applied and disclosed in the annual financial statements for the year ended 31 December 2008. Furthermore the Group does not expect there to be any changes to the accounting policies applicable at 31 December 2009.
The interim report has been prepared in accordance with the recognition and measurement principles of International Financial Reporting Standards (IFRSs) as endorsed by the European Union using accounting policies that are expected to be applied for the financial year ended 31 December 2009.
The financial information in this interim report does not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006.
The financial information for the year ended 31 December 2008 does not constitute the full statutory accounts for that period.
The Annual Report and Financial Statements for 2008 have been filed with the Registrar of Companies. The Independent Auditors' Report on the Annual Report and Financial Statements for 2008 was unqualified, did not draw attention to any matters by way of emphasis, and did not contain a statement under 237(2) or 237(3) of the Companies Act 1985.
Going concern
The group's business activities, together with the factors likely to affect its future development, performance and position are set out in the Reviews. The financial position of the group, its borrowings and borrowing facilities are described in the Financial Review.
The progress towards profitability is challenging and the group has reported another operating loss for the half year. Whilst there are a number of uncertainties, the directors consider that the outlook is now more promising. The directors have implemented measures to manage cash resources and secure appropriate levels of finance. At the date of approving this Interim Report the company's debt to Yorkville is £1.8 million including interest and debts to other lenders amount to £1.6 million.
The Yorkville convertible loan is due to be repaid or converted before 31 December 2009. Of the other loans written assurance has been received from the lender of £1.2 million that there is no intention to request immediate repayment and that subject to agreement the lender would accept repayment by the issue of shares in the company. The remaining loans are due for repayment by 1 June 2010 at which date the lenders gain conversion rights.
The directors do not expect there to be a requirement to repay the loans in cash during the next 12 months. Although no formal commitment has been received discussions with Yorkville indicate that it will be possible to extend the loan or to request the conversion of loan into equity. The directors believe that arrangements to renew the loan facilities or convert debt into equity will be achievable. Furthermore there is a £5 million Standby Equity Distribution Agreement ("SEDA") that could be used to facilitate settlement of claims and repayment of loans over time.
The arrangements to issue shares for debt need the renewal of the annual resolutions to empower directors to allot shares. Appropriate resolutions will be put to the 2009 AGM together with a resolution to increase the authorised share capital. The directors are confident that shareholder consent will be obtained.
Based upon forecasts prepared, after making enquiries and the comments made above, the directors have a reasonable expectation that the group has adequate resources to meet commitments as they fall due and continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the annual report and accounts.
Basis of consolidation
The financial statements consolidate the accounts of Environmental Recycling Technologies plc and its non-trading subsidiary undertakings. Intercompany transactions and balances between companies are eliminated in full.
2. Exceptional items
|
Six months ended 30 June 2009 |
Six months ended 30 June 2008 |
Year ended 31 December 2008 |
||
|
£'000 |
£'000 |
£'000 |
||
|
Unaudited |
Unaudited |
Audited |
||
|
Legal and settlement costs |
- |
491 |
642 |
|
|
Product development work |
- |
- |
1,082 |
|
|
Total exceptional items |
- |
491 |
1,724 |
The legal and settlement costs in 2008 related to a claim from a former employee in Kyrgyzstan and settlement costs of a legal dispute in Asia. The product development work related to fulfilling contractual obligations for product development for Mediwall and pre production work for Contour.
3. Finance costs
|
Six months ended 30 June 2009 |
Six months ended 30 June 2008 |
Year ended 31 December 2008 |
||
|
£'000 |
£'000 |
£'000 |
||
|
Unaudited |
Unaudited |
Audited |
||
|
Loan interest |
190 |
76 |
221 |
|
|
Bank interest |
- |
1 |
1 |
|
|
Amortisation of finance costs Loan conversion costs |
31 50 |
118 - |
202 - |
|
|
Total finance costs |
271 |
195 |
424 |
4. Earnings per share
From continuing operations
|
Six months ended 30 June 2009 |
Six months ended 30 June 2008 |
Year ended 31 December 2008 |
||
|
£'000 |
£'000 |
£'000 |
||
|
Unaudited |
Unaudited |
Audited |
||
|
Numerator |
||||
|
Loss used for calculation of basic and diluted EPS |
(813) |
(1,995) |
(3,176) |
|
Six months ended 30 June 2009 |
Six months ended 30 June 2008 |
Year ended 31 December 2008 |
||
|
number |
number |
number |
||
|
Unaudited |
Unaudited |
Audited |
||
|
Denominator |
||||
|
Weighted average number of shares used in basic and diluted EPS |
302,227,993 |
254,762,015 |
270,112,435 |
At 30 June 2009, there were 16,996,785 (31 December 2008 22,041,785) (H1, 2008 22,441,785) of potentially issuable shares which are anti-dilutive.
5. Borrowings
|
30 June 2009 |
30 June 2008 |
31 December 2008 |
|||
|
£'000 |
£'000 |
£'000 |
|||
|
Non current - due after one year |
Unaudited |
Unaudited |
Audited |
||
|
Long term borrowings |
- |
1,841 |
- |
||
|
Current - due within one year |
|||||
|
Short term borrowings |
1,635 |
1,495 |
1,479 |
||
|
Current portion of long term borrowings |
1,474 |
- |
1,649 |
||
|
|
3,109 |
1,495 |
3,128 |
||
|
Total borrowings |
3,109 |
3,336 |
3,128 |
||
The carrying value (which is a reasonable approximation to fair value) of borrowings analysed by lender is as follows -
|
30 June 2009 |
30 June 2008 |
31 December 2008 |
|||
|
£'000 |
£'000 |
£'000 |
|||
|
Unaudited |
Unaudited |
Audited |
|||
|
YA Global Investment Limited - current |
1,474 |
- |
1,649 |
||
|
- non current |
- |
1,841 |
- |
||
|
|
1,474 |
1,841 |
1,649 |
||
|
|
|||||
|
Other loans |
1,635 |
1,495 |
1,479 |
||
|
Total borrowings |
3,109 |
3,336 |
3,128 |
||
The amounts due to YA Global Investments Limited ("Yorkville"), are stated net of unamortised finance costs. This convertible loan is denominated in Sterling. Pursuant to an agreement dated 27 March 2008 Yorkville borrowings are secured by a fixed and floating charge over the assets of the Group. The loan is now due for repayment on or before 31 December 2009 and simple interest is being charged at 12% per annum. Subject to certain conditions Yorkville may convert their loan to ordinary shares of the company. The company has no other facilities except for the SEDA referred to in the Financial Review.
Other loans advanced during the period totalled £131,000. These loans and other existing loans carry interest at rates varying from 7.5% to 15% and conversion rights into ordinary shares.
6. Provisions
|
30 June 2009 |
30 June 2008 |
31 December 2008 |
|||
|
£'000 |
£'000 |
£'000 |
|||
|
Unaudited |
Unaudited |
Audited |
|||
|
At start of period |
563 |
545 |
545 |
||
|
Increase in provision |
- |
- |
179 |
||
|
Utilised in period |
(188) |
- |
(161) |
||
|
|
|||||
|
At end of period |
375 |
545 |
563 |
||
Provisions cover claims for legal and settlement costs associated with a former employee in Kyrgyzstan. The provision was increased during 2008 to cover further legal costs incurred and interest accruing on the court judgement. Amounts paid to the former employee and legal advisors have been offset against the provision.
Related Shares:
ENRT.L