29th Nov 2007 07:01
Byotrol PLC29 November 2007 Byotrol plc (the 'Company') Unaudited interim results for the six months ended 30 September 2007 Chairman's Statement The six month period has seen the Company make satisfactory progress across itstarget market sectors. The company is developing Byotrol as a globally trustedbrand in the field of microbial control and the core focus of the past sixmonths has been to harness and commercialise the outstanding accreditation andcertification work that has been undertaken to date in a number of our keymarkets. The Company now has a total of six key market sectors where sales, marketing andoperational resource is being focused; Consumer Products, Healthcare, Food &Beverage, Industrial & Technical, Hospitality & Leisure and Agriculture. The Board is very aware that the Company's financial results have yet to reflectthe progress we have made since the AIM flotation, albeit revenues haveincreased to £214,995 from £116,814 over the same period last year. As part of its development strategy, the Company has engaged the services of anumber of key advisers to maintain the pace of development as well as enhancingour levels of knowledge of specific market segments. During the period we appointed Adrian Smith as a Non-Executive Director of theCompany. Adrian brings a combination of corporate and plc experience withspecific expertise in the areas of sales, marketing and brand management gainedthrough 24 years working with two leading global providers in our key marketsectors. I am also pleased to be able to announce that the Company has enlisted theservices of the Rt. Hon Lord Warner of Brockley as a special adviser to thehealthcare sector. As a former Minister for Health, Norman Warner bringsunprecedented levels of understanding of healthcare delivery in the UK as wellas a distinguished track record across the wider public sector and his knowledgeand insight will play a key role in our drive to promote adoption of Byotroltechnology across the NHS. Finally we would like to express our thanks to all staff, partners and supplierswho have all played a vital role in the progress we have made in the first sixmonths of this financial year. Prospects Our progress in the short time since IPO in 2005 has yet to be reflected in ourfinancial results. The Board is very satisfied with the opportunities nowavailable to the Group and remains confident of the significant benefits of theadoption of Byotrol's technology, albeit that we must of course remain cautiousin our optimism. Wesley Devoto OBEChairman29 November 2007 Chief Executive's Report I am pleased to be able to provide shareholders with an update across each ofour core target market sectors. Consumer Products Byotrol Consumer Products ("BCP"), our joint venture with What If Venturesestablished in July 2007, provides the Company with an appropriate structure topursue its aim of entering the consumer products market. BCP's strategy is to target a limited number of high value distribution andlicensing deals with global FMCG companies in sectors where Byotrol technologyis at its most efficacious. The Board is very pleased with progress so far by BCP, in that BCP has met withseveral FMCG companies, and believes it to be on schedule to deliver revenues onthe timescales envisaged in July. The Board is extremely encouraged by theresponse generated thus far. However this must inevitably be tempered by theoften long lead times associated with the development and launch of new consumerproducts. Healthcare In 2006 the Company announced it had signed a technology licence agreement withSynergy Healthcare plc to provide a route to market for Byotrol technology tothe healthcare sector and specifically the National Health Service. Followingthe completion of this agreement in November 2006, a range of products forhospitals was launched in May 2007 under the Assure Plus brand. Supply to the NHS can be frustratingly slow and following this product launch,progress has indeed been slow. I am pleased, however, to report that sinceSeptember Synergy has made encouraging progress and the product has been adoptedby Bradford Primary Care Trust in two community hospitals and is in line to betaken up by others. In the care home market which was also licensed to Synergy: Care UK, a leadingcare home operator has completed the deployment of more than 4000 dispenserscontaining Byotrol in a hand mousse. I was also delighted with a recent Rapid Review Panel report on Assure Pluswhich confirmed that we are able to pursue immediate sales into hospitals andmore importantly has assisted in the finalisation of some critical studies thatare in process in a number of hospitals across North West England. Outside the UK, the Company is pleased to be able to report modest sales ofByotrol products into the healthcare system in North America. These sales havebeen achieved following a successful trial and evaluation of Byotrol technologyconducted at Monroe Hospital, Indiana. Food and Beverage Steady progress is being made within this market sector although the timescalerequired to move from initial dialogue with potential users to full roll out isproving longer than originally anticipated. The primary driver for this extendedtimescale is the fact that the majority of food processing companies wish toconduct their own independent product efficacy trials before committing toByotrol technology. The Company remains confident in the opportunity for Byotrolwithin this sector and I am pleased to be able to announce that during thistrading period Pennine Foods (a subsidiary of Northern Foods plc) has completeda successful trial of Byotrol technology and will now use it on an ongoing basisas part of its hygiene regime. I am also pleased to be able to announce that H JHeinz in Kendal has recently completed a successful trial of Byotrol and iscurrently reviewing its hygiene control strategy in the light of the outcome. Industrial and Technical Progress continues in this area and a recent trial of the Company's Intersphereproduct conducted in Venice has shown it is well suited the removal of greenalgae from buildings. The work undertaken in Venice also demonstrated thatByotrol technology is suitable for use on historic buildings and does not damageor degrade surfaces. The Company is working to drive adoption of Intersphere asa cleaner of choice for organisations involved in preservation and cleaning ofhistoric structures. In the field of office hygiene the launch of the Fellowesoffice hygiene range Virashield throughout Europe has been pleasing to thecompany and our partner. In September our partner in the pet care products basedon Byotrol exhibited at the international GLEE exhibition and passed a small butsignificant milestone of having sold 500,000 units of pet care productscontaining Byotrol. Hospitality and Leisure Within the trading period the Company has launched a range of cleaning productstargeted at the marine leisure market. The launch of the Stayclean range ofproducts in the North American market was undertaken at the NewportInternational Boat Show and the Company plans to roll out this product set inthe UK during the next trading period. Also in the leisure market, the companyhas launched the Clearway range of products in the UK. These have been developedfor leisure users to allow them to remove algae and growth from a wide range ofsurfaces including buildings and caravans as well as pathways and decking. Theseproducts are currently being sold into garden centres and DIY stores across theUK Agriculture Following launch in May 2007, the Agrisphere range of products is starting to beadopted by dairy farmers across the UK. In light of the recent outbreak of footand mouth disease, the Company is currently seeking DEFRA approval for Byotroltechnology to become an approved disinfectant for use against this disease.Based on our test work we are confident that Byotrol technology is effectiveagainst the foot and mouth virus and formal ratification by DEFRA is awaited.Within North America the crop trial being conducted in Florida is still underwayand an interim report has shown favourable results in combating the spread ofcitrus canker which represents a major economic threat to farmers of citruscrops. The Company believes that, assuming a successful outcome of the trial, asignificant opportunity exists within this area. Intellectual Property and Quality Management Byotrol maintains very high quality standards that are regularly audited by theTuV. Our processes are administered by two highly experiencedprofessionals Dr Ricky Chapman & Dr Ulrich Schwarz. Our ISO 13485 certificationwas confirmed in July this year. The protection of the Company's intellectual property is a high priority andduring the period two new significant technology patents were filed to protectinnovations and increase protection of the products based on our technology.Patent applications are important, both to increase security but also todemonstrate the Company's ongoing research and development credentials. Howevergranted patents are, if anything, even more important as they clearly evidencethe unique nature of the Company's technology. A very significant acceptance ofthe patent was made by the European Patent Office. This can now be translatedinto grants of patents throughout the EU in the second quarter of 2008. Also theAustralian patent agency accepted the patent and the Singapore authoritiesissued a grant. David McRobbieChief Executive29 November 2007 Enquiries Byotrol plc 0161 277 9518Stephen Falder, Deputy Chairman 07767 404629David McRobbie, Chief Executive 07739 549 226Richard Bell, Finance Director 07825 204110 Charles Stanley Securities, Nominated Adviser 020 7149 6457Philip Davies / Carl Holmes Rawlings FinancialJohn Rawlings 01756 770376 Byotrol plcUNAUDITED CONSOLIDATED INCOME STATEMENTfor the period ended 30 September 2007 6 Mths 6 Mths 12 Mths 30-Sep-07 30-Sep-06 31-Mar-07 £ £ £ Revenue 214,995 116,814 673,542Cost of sales (81,533) (66,798) (194,703) Gross profit 133,462 50,016 478,839 Administration expenses excluding share scheme (1,494,076) (978,531) (2,215,041)chargesShare scheme charges (162,493) - (94,231) Operating loss (1,523,107) (928,515) (1,830,433) Finance income 85,846 17,743 87,865Finance costs (330) (185) (1,572) Loss before taxation (1,437,591) (910,957) (1,744,140) Taxation - - - Loss after taxation (1,437,591) (910,957) (1,744,140) Minority interest - 137 236 Loss for the period attributable to equity (1,437,591) (910,820) (1,743,904)shareholders Loss per shareBasic per share (pence) (3.26) (2.61) (4.56)Diluted per share (pence) (3.26) (2.61) (4.56) The loss for the period arises from the group's continuing operations Byotrol plcUNAUDITED CONSOLIDATED STATEMENT OF RECOGNISED INCOME AND EXPENSEfor the period ended 30 September 2007 6 Mths 6 Mths 12 Mths 30-Sep-07 30-Sep-06 31-Mar-07 £ £ £ Exchange differences on translation of foreign 21,543 21,923 46,678operations 21,543 21,923 46,678Loss for the period (1,437,591) (910,820) (1,743,904) Total recognised income and expense for the (1,416,048) (888,897) (1,697,226)period Byotrol plcUNAUDITED CONSOLIDATED BALANCE SHEETas at 30 September 2007 Restated Restated 30 September 30 September 31 March 2007 2006 2007 £ £ £ASSETSNON CURRENT ASSETSIntangible assets 37,333 9,333 39,083Software intangibles 19,737 28,822 23,117Property, plant and equipment 46,754 30,195 46,792Investments 23,814 5,000 - 127,638 73,350 108,992 CURRENT ASSETSInventories 104,035 40,194 46,173Trade and other receivables 621,258 174,793 690,048Tax debtor 40,710 52,578 37,017Cash and cash equivalents 2,662,980 256,825 3,553,038 3,428,983 524,390 4,326,276 TOTAL ASSETS 3,556,621 597,740 4,435,268 LIABILITIESCURRENT LIABILITIESTrade and other payables 387,441 428,161 250,597Tax payable 28,559 14,777 26,951 TOTAL LIABILITIES 416,000 442,938 277,548 EQUITYShare capital 111,655 87,182 109,073Share premium account 7,875,773 2,945,529 7,640,752Merger reserve 1,064,712 1,064,712 1,064,712Retained earnings (5,911,519) (3,943,867) (4,657,964) EQUITY ATTRIBUTABLE TO SHAREHOLDERS OF 3,140,621 153,556 4,156,573BYOTROL plc Minority interest - 1,246 1,147 TOTAL EQUITY 3,140,621 154,802 4,157,720 TOTAL EQUITY AND LIABILITIES 3,556,621 597,740 4,435,268 Byotrol plcUNAUDITED CONSOLIDATED CASH FLOW STATEMENTfor the period ended 30 September 2007 30 September 30 September 31 March 2007 2006 2007 £ £ £ Net cash outflow from operating activities (1,176,549) (914,842) (2,387,966)Returns on investments and servicing of financeInterest received 85,846 17,743 87,865Interest paid (330) (185) (1,572)Net cash inflow from returns on investments and 85,516 17,558 86,293servicing of finance Taxation - - - Cash flows from investing activitiesPurchase of tangible fixed assets (10,228) (8,639) (33,966)Purchase of intangible fixed assets - - (30,000)Purchase of software (2,586) (11,305) (11,490)Purchase of investment (23,814) - -Net cash outflow from investing activities (36,628) (19,944) (75,456) Net cash outflow before use of liquid resources and (1,127,661) (917,228) (2,377,129)financing Cash flows from financing activitiesIssue of ordinary share capital 237,603 - 5,107,428Expenses of share issue - - (390,314) Net cash inflow from financing 237,603 - 4,717,114 (Decrease)/increase in cash (890,058) (917,228) 2,339,985 Byotrol plcUNAUDITED CONSOLIDATED STATEMENT OF CHANGES IN EQUITYas at 30 September 2007 Share Share Merger Minority Retained Capital Premium Reserve Interest Earnings Total £ £ £ £ £ £ Balance at 1 April 2006 87,182 2,945,529 1,064,712 1,383 (3,054,969) 1,043,837Exchange difference - - - - 21,922 21,922Loss for the period - - - (137) (910,820) (910,957) Balance at 30 September 87,182 2,945,529 1,064,712 1,246 (3,943,867) 154,802 2006Placing of shares 20,850 4,983,150 - - - 5,004,000Placing costs - (390,314) - - - (390,314)Conversion of warrants 1,041 102,387 - - - 103,428Share scheme charges - - - - 94,231 94,231Exchange difference - - - - 24,756 24,756Loss for the period - - - (99) (833,084) (833,183) Balance at 31 March 2007 109,073 7,640,752 1,064,712 1,147 (4,657,964) 4,157,720Conversion of warrants 2,582 235,021 - - - 237,603Minority interest - - - (1,147) - (1,147)Share scheme charges - - - - 162,493 162,493Exchange difference - - - - 21,543 21,543Loss for the period - - - - (1,437,591) (1,437,591) Balance at 30 September 111,655 7,875,773 1,064,712 - (5,911,519) 3,140,621 2007 1 This interim statement for the period to 30 September 2007 is unauditedand was approved by the Directors on 29 November 2007. The information set outdoes not constitute statutory accounts within the meaning of Section 240 of theCompanies Act 1985. 2 Accounting policies Basis of preparation The Group's previous financial statements have been prepared under UK GenerallyAccepted Accounting Principles (UK GAAP). For the financial year ended 31 March2008, the Group will prepare its annual consolidated financial statements inaccordance with IFRS as adopted by the European Union (EU) and implemented inthe UK. The Group's date of transition to IFRS was 1 April 2006 at which date the Groupprepared its opening IFRS balance sheet. The financial information for the sixmonths ended 30 September 2007 has been prepared in accordance with the Group'saccounting policies based on IFRS standards that are expected to apply for thefinancial year ending on 31 March 2008. The financial information for the sixmonths ended 30 September 2006 has been restated under IFRS. An explanation of how the transition from UK GAAP to IFRS has affected theGroup's financial statements for the relevant periods is set out in note 8. Basis of consolidation The group financial information consolidates the financial information ofByotrol plc and all its subsidiary undertakings drawn up to 3 September 2007. Going concern The directors have prepared cash flow forecasts for the Group that reflect theGroup's forecast revenues and costs. It is envisaged by the directors thatthese forecast revenue streams will provide adequate funds for Byotrol plc andall its subsidiary companies for the foreseeable future. In the event that the Group is unable to achieve its forecast revenues, furtherfunding would be required. The directors have reviewed the availability of debtand equity funding and anticipate being able to raise additional funds shouldthis be necessary. As a result, the directors have formed a view that adequatefunds will be available for Byotrol plc and all its subsidiary companies for atleast the next year. The financial information has therefore been prepared on a going concern basis.The financial information does not contain any adjustments which would result ifthe Group does not generate sufficient revenue and free cash flows from itstrading activities or if any future fund raising exercise was not successful. Revenue Revenue represents the amounts received and receivable in the period for productdelivered in the period, and licence fees and royalties earned during theperiod. Intangible assets Software is classified as an intangible asset and is stated at historical cost.Amortisation is provided on all intangible assets at rates of 10% and 5%, asappropriate, calculated to write each asset down to its estimated residual valueevenly over its expected useful life. Property, plant and equipment Property, plant and equipment are stated at historical cost. Depreciation isprovided on all assets at rates calculated to write each asset down to itsestimated residual value evenly over its expected useful life, as follows: Leasehold property 33 1/3% per annumOffice equipment, plant and equipment 20% per annumComputer equipment 33 1/3% per annumMotor vehicles 25% per annum Investments Investments are stated at cost. Provision is made for any impairment in thevalue of fixed asset investments. Inventories Inventories are valued at the lower of cost and net realisable value on basesconsistent with previous years. Cost represents expenditure incurred in theordinary course of business to bring inventories to its present condition andlocation and includes appropriate overheads. Foreign currencies Assets and liabilities in foreign currencies are translated into sterling at therates of exchange ruling at the balance sheet date. Transactions in foreigncurrencies are translated into sterling at the rate of exchange ruling at thedate of the transaction. Capital accounts are translated using the historicexchange rate as at the date of issue of capital units. Exchange differencesarising on trading transactions are taken into the profit and loss account forthe period. Exchange differences arising on retranslation of capital balancesare shown as a movement on reserves. Operating lease commitments Rentals paid under operating leases are charged to the profit and loss accountas incurred. Research and development Expenditure on research activities is recognised as an expense in the period inwhich it is incurred. An internally-generated intangible asset arising from the Group's businessdevelopment is recognised only if all of the following conditions are met: • an asset is created that can be identified (such as software and new processes); • it is probable that the asset created will generate future economic benefits; • the development cost of the asset can be measured reliably; • the product or process is technically and commercially feasible; and • sufficient resources are available to complete the development and to either sell or use the asset. Where no internally-generated intangible asset can be recognised, developmentexpenditure is recognised as an expense in the period in which it is incurred. Internally-generated intangible assets are amortised on a straight-line basisover their useful lives. Patents and trademarks Patents and trademarks are measured initially at purchase cost and amortised ona straight-line basis over their estimated useful lives. (10 to 15 years) Deferred tax Deferred tax is recognised in respect of all timing differences that haveoriginated but not reversed at the balance sheet date where transactions orevents have occurred at that date that will result in an obligation to pay more,or a right to pay less or to receive more, tax with the following exceptions: • Deferred tax assets are recognised only to the extent that the directors consider that it is more likely than not that there will be appropriate taxable profits from which the future reversal of the underlying timing differences can be deducted. Deferred tax is measured at the tax rates that are expected to apply in theperiods in which timing differences reverse, based on tax rates and laws enactedor substantively enacted at the balance sheet date. Pensions The Group operates a defined contribution scheme whereby contributions arecharged to the profit and loss account as incurred. Financial instruments Financial instruments and their derivatives are categorised as held for tradingor held as hedges. The fair value of all instruments held for trading is recognised in the balancesheet and all unrealised profits and losses are taken to operating profit. All hedging instruments are matched with their underlying hedged item. Eachinstrument's gain or loss is brought into the profit and loss account and itsfair value into the balance sheet, at the same time and in the same place as isthe matched underlying asset, liability, income or cost. For foreign exchangeand commodity instruments this will be in the operating profit matched againstthe relevant purchase or sale, and for interest rate instruments within interestpayable or receivable over the life of the instrument or relevant interestperiod. The profit or loss on an instrument may be deferred if the hedgedtransaction is expected to take place or would normally be accounted for in afuture period. Differences arising from the movement in exchange rates during the period fromthe translation to sterling of the foreign currency borrowing and similarinstruments used to finance long-term foreign equity investments are takendirect to distributable reserves and reported in the statement of recognisedincome and expense. Changes in the fair value of most financial instruments or the underlying hedgeditem are not recognised in the income statement. All premiums or fees, paid or received, in respect of a financial instrument areaccounted for over the life of the matched underlying asset, liability, incomeor cost, even if the instrument has been sold. If the matched underlying asset,liability, income or cost ceases to exist, or is no longer considered likely toexist in the future, the hedging instrument is sold. Any profit or loss on thesale is recognised in the income statement as part of operating profit. Share-based payments The Group has applied the requirements of IFRS 2 Share-based Payments. The Group issues equity-settled share-based payments to certain employees.Equity-settled share-based payments are measured at fair value at the date ofgrant. The fair value determined at the grant date of equity-settled share-basedpayments is expensed on a straight line basis over the vesting period, based onthe Group's estimate of shares that will eventually vest. The correspondingcredit is made direct to retained earnings. Fair value is measured by use of the Black Scholes model. The expected life usedin the model has been adjusted, based on management's best estimate, for theeffect of non-transferability, exercise restrictions and behaviouralconsiderations. A liability equal to the portion of the goods or services received is recognisedat the current fair value determined at each balance sheet date for cash-settledshare based payments. 3 Revenue Revenue and loss before taxation were all derived from the Group's principalactivities. The analysis of revenue by source is: 6 Mths 6 Mths 12 Mths 30-Sep-07 30-Sep-06 31-Mar-07 £ £ £ Product sales 204,181 116,814 471,025Licence fees 10,345 - 200,000Royalties 469 - 2,517 214,995 116,814 673,542 The directors consider that the business generates revenues from the above threedistinct sources. The three streams have a shared and largely inseparable costbase, and thus the directors consider that there is only one business segment The geographical analysis of revenue is: 6 Mths 6 Mths 12 Mths 30-Sep-07 30-Sep-06 31-Mar-07 £ £ £ UK 165,908 43,700 206,157North America 25,784 13,675 434,712Rest of World 23,303 59,439 32,673 214,995 116,814 673,542 4 The interim financial information contained in this statement does notconstitute statutory accounts as defined in section 240 of the Companies Act1985. The accounts for the year ended 31 March 2007, upon which the auditorsissued an unqualified opinion and which did not contain a statement under s237(2) or (3) Companies Act 1985, have been delivered to the Registrar ofCompanies. 5 Loss per ordinary share The loss per ordinary share is based on the losses for the period of£1,437,591 (six months ended 30 September 2006: £910,957 loss; twelve monthsended 31 March 2007 £1,744,140 loss) and the weighted average number of ordinaryshares in issue during the period of 44,151,980 (six months ended 30 September2006: 34,872,849; twelve months ended 31 March 2007: 38,242,833). The loss for the period and the weighted average number of ordinary shares forcalculating the diluted earnings per share for the six months ended 30 September2007 and for the comparative periods are identical to those used for the basicearnings per share. This is because the outstanding share options would havethe effect of reducing the loss per ordinary share and would therefore not bedilutive. 6 Taxation No liability to UK corporation or overseas income taxes arises for theperiod due to losses incurred. The directors have assessed the position inrelation to deferred tax and concluded that no provision or asset should becreated at this stage in respect of deferred tax in view of the timescale anduncertainty of the recovery of tax losses. This position will be reviewed againat 31 March 2008. 7 Cashflows Reconciliation of Operating Loss to Net Cash Outflow from Operating Activities 6 Mths 6 Mths 12 Mths 30-Sep-07 30-Sep-06 31-Mar-07 £ £ £ Loss before tax (1,437,591) (910,957) (1,744,140) Interest received net of paid (85,516) (17,558) (86,293) Share scheme charges 162,493 - 94,231 Depreciation of property, plant and equipment 10,266 6,383 15,113 Amortisation of intangible assets 1,750 250 500 Amortisation of software intangibles 5,966 5,189 11,079 (Increase) in inventories (57,862) (19,014) (24,993) Decrease/(increase) in trade and other receivables 63,950 (109,194) (608,888) Increase/(decrease) in trade, other payables and 138,452 108,137 (96,253) provisions Provision against investment - - 5,000 Exchange differences 21,543 21,922 46,678 Net cash outflow from operating activities (1,176,549) (914,842) (2,387,966) Reconciliation of net cash flow to movement in Net Debt 6 Mths 6 Mths 12 Mths 30-Sep-07 30-Sep-06 31-Mar-07 £ £ £ (Decrease)/increase in cash in the period (890,058) (917,228) 2,339,985 Cash inflow from decrease in debt - - 152,262 Movement in net cash in the period (890,058) (917,228) 2,492,247 Net cash at start of period 3,553,038 1,113,491 1,060,791 Net cash at end of period 2,662,980 196,263 3,553,038 At 1 Apr Cash flow Non cash At 30 Sep 2007 movement 2007 £ £ £ £ Analysis of net debt Net cash: Cash at bank and in hand 3,553,038 (890,058) - 2,662,980 Overdraft - - - - Net cash 3,553,038 (890,058) - 2,662,980 8. The Group has only one IFRS adjustment which is to reclassifypurchased software from Plant & Machinery to Software Intangibles. The tablesbelow show the effect of the reclassification. At 31 March 2007 Original Restated Balance sheet Adjustments Balance sheet £ £ £ Fixed assets Intangible assets 39,083 (39,083) - Tangible assets 69,909 (69,909) - Investments - - - - Non current assets Intangible assets - 39,083 39,083 Software intangibles - 23,117 23,117 Property, plant and equipment - 46,792 46,792 Investments - - - Fixed assets/Non current assets 108,992 - 108,992 At 30 September 2006 Original Restated Balance sheet Adjustments Balance sheet £ £ £ Fixed assets Intangible assets 9,333 (9,333) - Tangible assets 59,017 (59,017) - Investments 5,000 (5,000) - Non current assets Intangible assets - 9,333 9,333 Software intangibles - 28,822 28,822 Property, plant and equipment - 30,195 30,195 Investments - 5,000 5,000 Fixed assets/Non current assets 73,350 - 73,350 At 31 March 2006 Original Restated Balance sheet Adjustments Balance sheet £ £ £ Fixed assets Intangible assets 9,583 (9,583) - Tangible assets 50,645 (50,645) - Investments 5,000 (5,000) - Non current assets Intangible assets - 9,583 9,583 Software intangibles - 22,706 22,706 Property, plant and equipment - 27,939 27,939 Investments - 5,000 5,000 Fixed assets/Non current assets 65,228 - 65,228 9 The interim report was issued to the Stock Exchange and the press on29 November 2007 and will be posted to shareholders. Further copies of theinterim report are available at the Company's Registered Office and a copy willbe posted on the Company's website. Introduction We have been engaged by the Company to review the condensed set of financialstatements in the interim financial report for the six months ended 30 September2007 which comprises the consolidated income statement, the consolidatedstatement of recognised income and expense, the consolidated balance sheet, theconsolidated cash flow statement, the consolidated statement of changes inequity and the accompanying notes. We have read the other information containedin the interim financial report and considered whether it contains any apparentmisstatements or material inconsistencies with the information in the condensedset of financial statements. This report, including the conclusion, has been prepared for and only for theCompany for the purpose of meeting the requirements of the AIM Rules forCompanies and for no other purpose. We do not, therefore, in producing thisreport, accept or assume responsibility for any other purpose or to any otherperson to whom this report is shown or into whose hands it may come save whereexpressly agreed by our prior consent in writing. Directors' Responsibilities The interim financial report, is the responsibility of, and has been approved bythe directors. The directors are responsible for preparing and presenting theinterim financial report in accordance with the AIM Rules for Companies. As disclosed in note 2, the annual financial statements of the Group areprepared in accordance with International Financial Reporting Standards andInternational Financial Reporting Interpretations Committee ("IFRIC")pronouncements as adopted by the European Union. The condensed set of financialstatements included in this interim financial report has been prepared inaccordance with the measurement and recognition criteria of InternationalFinancial Reporting Standards and International Financial ReportingInterpretations Committee ("IFRIC") pronouncements, as adopted by the EuropeanUnion. Our Responsibility Our responsibility is to express to the Company a conclusion on the condensedset of financial statements in the interim financial report based on our review. Scope of Review We conducted our review in accordance with International Standard on ReviewEngagements (UK and Ireland) 2410, "Review of Interim Financial InformationPerformed by the Independent Auditor of the Entity" issued by the AuditingPractices Board for use in the United Kingdom. A review of interim financialinformation consists of making enquiries, primarily of persons responsible forfinancial and accounting matters, and applying analytical and other reviewprocedures. A review is substantially less in scope than an audit conducted inaccordance with International Standards on Auditing (UK and Ireland) andconsequently does not enable us to obtain assurance that we would become awareof all significant matters that might be identified in an audit. Accordingly, wedo not express an audit opinion. Conclusion Based on our review, nothing has come to our attention that causes us to believethat the condensed set of financial statements in the interim financial reportfor the six months ended 30 September 2007 is not prepared, in all materialrespects, in accordance with the measurement and recognition criteria ofInternational Financial Reporting Standards and International FinancialReporting Interpretations Committee ("IFRIC") pronouncements as adopted by theEuropean Union, and the AIM Rules for Companies. BAKER TILLY UK AUDIT LLPChartered AccountantsBrazennose HouseLincoln SquareManchesterM2 5BL 29 November 2007 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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