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Interim Results

30th Mar 2009 07:00

RNS Number : 6631P
Hot Tuna (International) plc
30 March 2009
 



30 March 2009

Hot Tuna International PLC

("Hot Tuna" or "the Company")

Interim Report for the period ending 31 December 2008

HIGHLIGHTS

Sales increase of 39%;

Operational loss reduced by 59% to £679,000;

Debenhams increased the number of stores in which it stocks product from 5 to 45;

Benefits from cost reductions in 2008 now starting to come through;

Australian market still performing strongly.

Hot Tuna (International) Plc (AIM: HTT), a leading surf wear and fashion brand, presents its consolidated results for the half year ending 31 December 2008.

In spite of an extremely challenging trading environment, Hot Tuna continues to perform strongly with sales increase of 39% in the six months to 31 December 2008. The Group continues to reap the benefits of the earlier restructuring across all regions. This, coupled with a shift in sales strategy; positioning the Hot Tuna brand from smaller independent retailers to major national retailers around the globe, has, and should continue to see an upward trend in revenue. 

The increase in sales has been achieved by reducing our cost base and lowering our marketing costs in line with stockists' expectations as well as greater use of partnering. The improvement in revenue and a focus on a rigorous cost cutting exercise has enabled the Group to reduce its operational loss by some 59% to £679,000 against the corresponding period's operational loss of £1,653,000.

All regions now have considerably lower overheads than at the same time last year which means that the Group is in a significantly stronger position to face the global economic downturn.

In Australia, the economic downturn has not yet been as severe as in other parts of the world. With the brand considered a 'home brand' by the market, we anticipate that our Australian business will continue to see strong sales increases with the major stockists of Myer and David Jones with an expanded product range stocked.

In Europe the relocation of some parts of the manufacturing for the European market to Turkey has enable us to capitalise on the benefits of a shorter route to market and lower transport and logistical costs. This will show through with greater prominence in the second half of the financial year. In the UK, Debenhams has increased the number of stores in which it stocks Hot Tuna from 5 to 45. In Germany, the online retailer Sportscheck increased their orders from Spring/Summer 2008 to Spring/Summer 2009 by 305%.

The USA continues to pose challenges however the brand has now broken into Delia's and Victoria's Secret, with repeat orders on specific designs from these stockists. This supports our ongoing strategy of pursuing larger accounts in the USA. Further tightening of logistics and other costs will be required to push this into operational profit.

Niels Juul, Chief Executive commented: "We are pleased with these results in what has been a very difficult trading period across the globe. We cannot ignore the significant task ahead of us and future potential slowdown in retail sales across all our key markets. The Board continues to monitor all aspects of the business and will work with suppliers to reduce manufacturing and development costs. To support the current order book and growth potential of Hot Tuna, the Board is looking at various funding opportunities to provide the necessary working capital."

Enquiries:

Hot Tuna PLC

Niels Juul - CEO

Tel: 020 7016 5100

Pelham PR

Lucy Frankland 

Tel: 020 7337 1520 

Seymour Pierce Limited

Mark Percy

Tel: 0207 107 8000

   

Consolidated Income Statement 

For the period from 1 July 2008 to 31st December 2008

Half Year to 31.12.2008 (Un-audited)

Half Year to 31.12.2007 (Un-audited)

12 Months Ended 30.6.2008

(Audited)

£000

£000

£000

Notes

Continuing operations

Revenue

619

445

1,125

Cost of sales

(393)

(472)

(1,153)

Gross (loss)/profit

226

(27)

(28)

Selling and marketing expense

(110)

(382)

(425)

General and administrative expenses

(762)

(1,216)

(2,642)

Depreciation and amortisation

(33)

(28)

(57)

Loss from operations

(679)

(1,653)

(3,179)

Impairment of intangible assets

-

-

(2,588)

Exceptional share-based payment charge

-

120

-

Investment income

1

32

41

Loss on disposal of property, plant and equipment

(1)

(2)

(4)

Finance costs

(9)

(20)

(39)

Loss before tax 

(688)

(1,523)

(5,769)

Taxation

2

-

-

-

Loss for the period

(688)

(1,523)

(5,769)

Attributable to:

Equity holders

(688)

(1,523)

(5,769)

Minority interest

-

-

-

(688)

(1,523)

(5,769)

LOSS PER SHARE

Basic and diluted

4

(0.62) pence

(1.89) pence

(5.69) pence

  Consolidated Balance Sheet

At 31st December 2008

Half Year to 31.12.2008

(Un-audited)

Half Year to 31.12.2007

(Un-audited) 

12 Months Ended 

30.6.2008

(Audited)

£000

£000

£000

Assets

Non-current assets

Other intangible assets

2,650

5,238

2,650

Goodwill

207

207

207

Property, plant & equipment

84

156

119

2,941

5,601

2,976

Current Assets

Inventories

398

436

331

Trade and other receivables

491

497

426

Cash and cash equivalents

-

464

-

889

1,397

757

Total Assets

3,830

6,998

3,733

Liabilities

Current Liabilities

Bank loans and overdraft

63

-

35

Trade and other payables

840

460

557

Convertible loan note

134

47

184

1,037

507

776

Non-current Liabilities

Convertible loan note

-

111

-

-

111

-

Total Liabilities

1,037

618

776

Net Assets

2,793

6,380

2,957

Equity and other liabilities

Capital and reserves

Share capital

1,813

828

1,533

Share-based payment reserve

9,882

9,881

9,618

Share premium reserve

2,308

2,147

2,308

Merger reserve

1,474

1,474

1,474

Warrant reserve

296

800

296

Foreign exchange reserve

43

82

63

Retained loss

(13,023)

(8,832)

(12,335)

Equity attributable to equity holders of parent

2,793

6,380

2,957

Minority interest

-

-

-

Total Equity

2,793

6,380

2,957

  Consolidated Cash Flow Statement

For the period from 1 July 2008 to 31st December 2008

Half Year to 31.12.2008

(Un-audited)

Half Year to 31.12.2007

(Un-audited)

12 Months Ended 30.6.2008 

(Audited)

£000

£000

£000

Notes

Net Cash Flow from Operating Activities

5

(523)

(1,617)

(2,884)

Investing Activities

Interest received

1

32

41

Purchase of property, plant and equipment

-

(57)

(56)

Net Cash Flow from Investing Activities

1

(58)

(15)

Financing Activities

Proceeds on issue/(repayment) of convertible notes

-

(59)

(32)

Proceeds from issue of share capital

494

323

1,005

Net Cash Flow from Financing Activities

494

264

972

Net (decrease)/increase in cash and cash equivalents

(28)

(1,428)

(1,927)

Cash and cash equivalents at the beginning of the period

(35)

1,892

1,892

Cash and cash equivalents at the end of the period

(63)

464

(35)

Movement in Bank & Cash

(28)

(1,428)

(1,927)

Statement of changes in equity

For the period from 1 July 2008 to 31st December 2008

For the half year ended 31 December 2008

Share capital 

 

Share premium account 

 Share-based payment reserve 

 

Other 

reserves 

 

Warrant

reserve 

 Retained profit/

(loss) 

 Total 

 equity 

 Minority

 interest 

 Total 

Equity 

 £ 

 £ 

 £ 

 £ 

 £ 

 £ 

 £ 

 £ 

 £ 

Balance at 1 July 2008

1,533 

9,618 

2,308 

 1,537 

296 

 (12,335)

 2,957 

- 

2,957 

Net loss for the period

-

-

-

-

-

(688)

(688)

-

(688)

Exchange differences arising

-

-

-

(20)

-

-

(20)

-

(20)

Total recognised income and expense for period

-

-

-

(20)

-

(688)

(708)

-

(708)

Share conversion and issue

280

264

-

-

-

-

544

-

544

Balance at 31 December 2008

1,813

9,882

2,308

1,517

296

(13,023)

2,793

-

2,793

For the year ended 30 June 2008

£

£

£

£

£

£

£

£

£

Balance at 1 January 2008

828 

9,881 

2,147 

1,556 

 800 

(8,832)

6,380 

- 

6,380 

Net loss for the period

 - 

 - 

 - 

 - 

 - 

(3,503)

(3,503)

- 

(3,503)

Exchange differences

 - 

 - 

 - 

(19)  

 - 

 - 

(19) 

 - 

(19) 

Total recognised income and expense for the period

- 

- 

- 

(19)  

- 

(3,503)

(3,522)

- 

(3,522)

Share conversion and issue

705 

36 

 - 

-

 - 

 - 

  

 - 

741 

Cost of share issue and conversion

-

(60)

-

-

-

-

(60)

-

(60)

Warrants Subscribed

 - 

 (239) 

 - 

 -

239 

 - 

- 

 - 

- 

Warrants expired

-

-

-

-

(743)

-

(743)

-

(743)

Employee share option scheme

 - 

 - 

161  

 - 

 - 

 - 

 161 

 - 

161 

Balance at 30 June 2008

1,533 

9,618 

2,308

1,537 

296 

(12,335)

2,957 

- 

2,957

  

For the half year ended 31 December 2007

Share capital 

 Share premium account 

 Share-based payment reserve 

 

Other

reserves 

 

Warrant

reserve  

 

Retained profit/

(loss) 

 

Total 

 equity 

 Minority

 interest 

 Total 

 Equity 

 £ 

 £ 

 £ 

 £ 

 £ 

 £ 

 £ 

 £ 

 £ 

Balance at 1 July 2007

 774 

9,612 

2,267 

 1,527 

800 

(7,309)

 7,671 

- 

7,671 

Net loss for the period

-

-

-

-

-

(1,523)

(1,523)

-

(1,523)

Exchange differences

  - 

  - 

  - 

  29 

  - 

- 

29

- 

29

Total recognised income and expense for the period

- 

- 

- 

29 

- 

(1,523)

(1,494)

- 

(1,494)

Share conversion and issue

54 

269 

 - 

- 

 - 

 - 

323 

 - 

323 

Employee share option scheme

 - 

 - 

(120)

 - 

 - 

 - 

(120)

 - 

(120)

Balance at 31 December 2007

828 

9,881 

2,147 

1,556 

 800 

(8,832)

6,380 

- 

6,380 

  Notes to the unaudited Interim Report

For the period ending 31st December 2008

 

1. PRESENTATION OF INTERIM RESULTS

 

This interim report has been prepared in accordance with the accounting policies set out in the Company's Annual Report for the year ended 30 June 2008 and are expected to be used in the Annual Report for the year ended 30 June 2009.

 

The results for the six months ended 31 December 2008 have not been audited. The financial information contained in this report does not constitute statutory accounts within the meaning of Section 240 of the Companies Act 1985. The results for the year ended 30 June 2008 are based on the audited accounts (which received an unqualified audit report). Full accounts have been delivered to the Registrar of Companies and are available on request.

2. 2. TAXATION

No taxation has been provided due to losses in the period.

3. 3. DIVIDENDS

The Directors have not declared a dividend for the period.

 

4. LOSS PER SHARE

T The calculation of the basic and diluted earnings per share is based on the following data:

Earnings

£000's

Earnings for the purposes of basic earnings per share net loss for the period attributable to equity holders of the parent

688

Number of shares

Weighted average number of ordinary shares for the purposes of basic earnings per share

110,177,103

The denominator for the purpose of calculating the basic earnings per share has been adjusted to reflect all capital raisings. Due to the loss incurred in the period, there is no dilutive effect resulting from the issue of share options, warrants and shares to be issued.

 

5. RECONCILIATION OF NET OPERATING LOSS TO NET CASH OUTFLOW FROM 

OPERATING ACTIVITIES

Half Year to 31.12.2008 

(Un-audited)

Half Year to 31.12.2007 

(Un-audited)

12 Months Ended 30.6.2008 (Audited)

Cash outflow from Operating Activities

£000

£000

£000

Loss from operations

(679)

(1,653)

(3,179)

Adjusted for:

Depreciation of property, plant and equipment

33

28

57

Foreign exchange loss

(18)

-

9

Share based payments

-

-

41

Operating cash flows before movements in working capital

(590)

(1,625)

(3,071)

(Increase)/decrease in inventories

(67)

(37)

67

Decrease/(increase) in receivables

(66)

27

98

(Decrease)/increase in payables

283

(12)

60

Cash used in operations

(514)

(1,647)

(2,846)

Interest paid

(9)

(20)

(39)

Net Cash outflow from Operating Activities

(523)

(1,667)

(2,885)

  Notes to the unaudited Interim Report

For the period ending 31st December 2008

 

6. POST BALANCE SHEET DATE EVENTS

On 6 February 2009, the Company held its Annual General meeting and all resolutions were duly passed. 

On 12 March 2009, the Company held a General Meeting to propose a special resolutions to sub-divide each existing ordinary share of 1 pence each ("Existing Ordinary Shares") into one new ordinary share of 0.01 pence ("New Ordinary Shares") and one deferred share of 0.99 pence each ("Deferred Shares"), and to amend the Company's Articles of Association to set out the rights attaching to the Deferred Shares. The resolution was duly passed. 

On 25 March 2009, the Company issued and allotted 20,000 New Ordinary Shares at 0.5p per share. Following this issue, the Company has made application for the 20,000 New Ordinary Shares to be admitted to trading on AIM, with admission expected to occur on or around 31 March 2009.

Following the issue of the 20,000 New Ordinary Shares, the Company will have 181,323,419 Ordinary Shares in issue.

This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
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