28th Sep 2007 07:02
Timestrip PLC28 September 2007 TIME.L Timestrip Plc INTERIM RESULTS FOR THE 6 MONTHS ENDED 30 JUNE 2007 Timestrip Plc is pleased to announce its unaudited interim results for the 6months to 30 June 2007. Timestrip Plc develops, manufactures and sells patented Timestrip smart labelswhich monitor how long perishable food and other limited life products have beenopen or in use. Key Points • Steady progress being made despite lengthy sales cycles within global multinationals. New contract secured with Whirlpool, existing contracts progressing well • Partnerships agreed with leading packaging companies CCL Label and Plastek • Significant $3 million contract win post period end with leading US consumer goods company • Healthy sales pipeline building, underpinned by global references Paul Freedman, Timestrip's joint CEO, commented: "We remain committed to our strategy of pursuing substantial and sustainablerevenues through supply contracts with some of the largest consumer product,food and beverage companies worldwide. Sales cycles across these companies areproving to be lengthy, resulting in erratic short term revenues, however weremain confident that the pipeline for potential future orders is extremelyhealthy and will deliver significant recurring revenues into the longer term. Webelieve that the recently announced $3 million contract win with a leading NorthAmerican consumer goods company is a crucial step along this process. Product freshness, supply chain integrity and customer compliance with usageinstructions have become an absolute pre-requisite for leading brands. TheTimestrip technology can meet all of these needs and is therefore ideallypositioned to play a leading role in the intelligent packaging market in thefuture. We remain confident in our ability to evolve a revenue model that combines salesfrom in-house manufacturing with royalty revenues and raw material sales derivedfrom manufacturing licenses. Indeed, we have received a number of approachesfrom companies interested in acquiring manufacturing licenses and it is likelythat one of these will be agreed over the coming months." For further information: Paul Freedman, Joint CEO, Timestrip 01462 440 700 Shane Dolan, Biddicks 020 7448 1000 Fergus Marcroft, Evolution Securities 020 7071 4300 Chairman's Statement I am pleased to report that we have made some significant progress towards ourobjective of establishing Timestrip as a household name and a new standard inproduct labelling. So far in 2007 we have concluded our largest contract todate, (expected to generate at least $3million in revenues over the first threeyears) as well as deals with global brands such as Whirlpool and partnershipswith leading packaging companies such as CCL Label and Plastek. Theseachievements, along with the many other projects we are progressing, lead us tothe firm belief that the technology is moving closer to a "tipping point" inseveral key markets. Financial Results Turnover for the six months to 30 June 2007 was £109,647 (30 June 2006 asrestated - £215,932). At the pre-tax level the Company recorded a loss of£730,429 (2006 as restated - £397,460) including a charge relating to FRS20(accounting for share based payments) amounting to £137,396 (2006 as restated -£36,894). The resultant loss per share is 0.23p (2006 - 0.13p). The Company hadcash resources of £1.83m as at the end of June, which your Board considers to besufficient to take the business through to profitability Operations As is reported in the Joint Chief Executives' statement below, we have made goodprogress towards the widespread adoption of our core technology in a number ofdifferent markets and sectors. Increasing awareness of the technology has led to a sharp increase in the numberof demands placed on the business by potential customers, but I am pleased toreport that we continue to exceed customer expectations, delivering customisedproducts and solutions for uses ranging from market tests to full scaleproduction. Additionally, our employees remain highly motivated and well incentivised todrive forward the Timestrip business and the Board wishes to thank them fortheir continued hard work and commitment. Current Trading and Prospects We appreciate the frustration caused by both the speed at which revenues arecoming on stream as well as the confidentiality restrictions that prevent usfrom fully disclosing the breadth and quality of the sales pipeline and revenuepotential therein. These extended timetables imposed by our potential customersmake it probable that the contracts necessary for us to exceed 2006's sales willnot be finalised in time for shipment to fall in 2007. However, we remaincommitted to our strategy of targeting customers in each market who are able togenerate not only large volume orders but also predictable and repeatablerevenue streams for the Company, even if the consequences are prolongeddevelopment cycles in many cases. We retain a tight control over our monthlycash costs and therefore, despite the time being taken to secure these contractswe remain confident that the Company has adequate financial resource to reachprofitability. A recent influential industry report* has predicted growth in the intelligentpackaging market in the US to $165m in 2011, led principally by labeltechnologies that help improve food safety and reduce losses in perishables fromtemperature abuse in the supply chain. Technologies that monitor "compliance"(i.e. replace every three months, use once a month) are also indentified as akey driver to this growth. Timestrip has the unique ability to delivermeaningful benefits in all three of these areas and we are ideally positioned tobecome the leading player in this exciting market. Stephen OakesChairman28 September 2007 * Active & Intelligent Packaging., The Freedonia Group Inc. Joint Chief Executives' Statement Operating Review We are pleased to report some good progress in the six international massmarkets in which relative expiry dates are predominantly found: Appliances and Consumables Timestrip is gaining widespread acceptance as the technology of choice forappliances with Period after Opening/Time in Service dates. It has been adoptedas an integrated component in devices sold globally by Whirlpool, Hamilton Beach/Febreze(R), Hygolet, DryandStore (Dry Brik II), and Bioconservacion SA. Our increasing exposure in this sector has generated a pipeline with a number ofpotentially lucrative deals, each with the prospect for recurring annualrevenues. In each case, the client has selected Timestrip as its preferredtechnology partner. Customised product has been supplied for use in a variety ofmarket tests ranging from confidential home trials to regional test launches.Our ability to convert these deals and the timing of them now depends on theprogress of the tests. Initial reports are very encouraging and we expect toreport definitive progress later this year. Catering and Food Services We continue to work closely with our US and European distributors to gain wideradoption of the technology amongst catering establishments, where Timestrips arepositioned as an essential upgrade to existing food safety systems. Substantialnew distribution opportunities are being actively evaluated in order to expandour presence in an expansive global market. Recent accreditation of thetechnology by the German food safety organization BVLK will help in ourmarketing of Timestrip in this sector. We are actively targeting both small to medium size businesses who will helpbuild a track record for us in this sector, as well as large chains who canprovide large volume orders and excellent reference sites for the technology. We recently became involved in a partnership, which includes two leading foodmanufacturers and a major restaurant chain, looking to employ the Timestriptechnology as a device to monitor time and temperature abuse in the supply chainof fresh and frozen produce in hot climates. The revenue potential for such adevice is substantial. Food and Beverage Timestrips represent an opportunity for manufacturers and brands to promote thefreshness of their products as well as to help consumers avoid unnecessary wasteby alerting them to how long an item has been open. The F & B sector is anatural home for Timestrip, and although the pace of progress has been muchslower than anticipated, the revenue potential is so significant that it remainsat the heart of our efforts. The growing trend towards stating "Period after Opening" dates on fresh productsin North America has opened up a number of exciting opportunities to integrateTimestrip technology into the packaging of premium brand fresh foods which havea "once opened use within.." instruction. The process is lengthy and involvesthe brand owner, manufacturer and packaging company, however we believe that ourfirst landmark deal in this market is close to fruition. Timestrip technology still features on the packaging of sauces sold by NestleFoodservice UK and progress continues to be made towards our goal of widespreadadoption in the retail food market. In this regard we would like to thank ourpartners CCL Label and Plastek for their co-operation in the development ofsolutions for the integration of Timestrips into labels and closures. Cosmetics, Pharmaceuticals, Medical Devices We recently started to supply a leading European medical equipment company whoare looking to integrate the technology with one of their core products, tocommunicate the useful life of the product after first use. Market testing andproduct development is expected to last another three to six months after whicha full scale adoption would generate an important source of predictablerevenues. There is an unprecedented level of interest in the Timestrip technology from thecosmetics industry, where European legislation requires a "Period After Opening"date on most products, and newspaper reports have highlighted health issuessurrounding the prolonged use of items such as mascara and face creams. Theopportunity for integrated packaging solutions as well as shorter termpromotions is being actively pursued. The pharma market has notoriously long cycles for product innovation but ourexposure to this market is growing and we remain very optimistic about thismarket in the medium term. iStrip(R) Introduced in late 2006, iStrip is a unique, patent pending label that changescolour irreversibly if an accidental freezing event takes place in the coldchain for products such as vaccines and agri-chemicals. We are working closely on the specification for the product with theNon-Government Organisation PATH as well as one of the largest global logisticscompanies, whose recent field trials have produced some very encouragingresults. The potential clearly exists to generate initial revenues from selling caselevel iStrips to a variety of distributors in the time/temperature industry.Production capacity has been secured but the product will not be launched untilproduct development and comprehensive testing is complete. In summary, we firmly believe in our strategy of targeting blue chip customerswith the potential to provide high volume recurring revenues. Although this hasled to delays in delivering significant revenues to date, the recent contractwin and the growing number of international brand names who have adopted thetechnology gives us great cause for optimism. Paul Freedman Reuben IsbitskyJoint Chief Executive Officer Joint Chief Executive Officer28 September 2007 28 September 2007 Consolidated Income statement 6 months to 30 June 2007 6 months to 30 June 2006 12 Months to 31 December 2006 Unaudited Unaudited Audited As restated* As restated* £ 000's £ 000's £ 000's Revenue 110 216 379Cost of sales (56) (139) (281) -------- ---------- ---------- Gross Profit 53 77 98 Distribution - - -costsAdministrativeexpenses (838) (538) (1,288) Loss from Operations (784) (462) (1,190)InvestmentRevenue 54 64 123Finance - - (8)costs -------- ---------- ----------Loss before tax (730) (397) (1,075) Taxation - - 90 -------- ---------- ----------Loss for theperiod (730) (397) (985) -------- ---------- ----------Loss for theperiodattributableto ordinaryshareholders (730) (397) (985) ======== ========== ========== Basic anddiluted EPS (0.23) p (0.13) p (0.32) p *Re-stated in accordance with IFRS Summary Consolidated Balance Sheet 6 months to 30 June 2007 6 months to 30 June 2006 12 Months to 31 December 2006 Unaudited Unaudited Audited As restated* As restated* £ 000's £ 000's £ 000'sNon current assetsGoodwill 5,643 5,643 5,643Otherintangibleassets 1,637 1,148 1,320Property,plant &equipment 370 252 372 ---------- ----------- ----------- 7,650 7,043 7,335 ---------- ----------- -----------Current assetsInventory 225 72 183Trade andother receivables 213 250 186Corporation tax 109 0 195Cash and cashequivalents 1,831 3,369 2,517 ---------- ----------- ----------- 2,378 3,691 3,082 ---------- ----------- -----------Total Assets 10,027 10,734 10,416 ---------- ----------- ----------- Current LiabilitiesTrade and other (417) (234) (404)payablesBank overdraftsand loans (14) (14) (21)Obligationsunder financeleases (6) (6) (6) ---------- ----------- ----------- (438) (254) (430) ---------- ----------- ----------- Non-current LiabilitiesBank Loans (45) (60) (52)Obligationsunder financeleases (44) (13) (18) ---------- ----------- -----------TotalLiabilities (527) (326) (501) ---------- ----------- ----------- ---------- ----------- -----------Net Assets 9,501 10,408 9,915 ========== =========== =========== EquityShare Capital 3,608 3,607 3,607Share PremiumAccount 27,719 27,524 27,542Share OptionsReserve 318 103 180Retainedlosses (22,144) (20,825) (21,414) ---------- ----------- -----------EquityShareholders funds 9,501 10,408 9,915 ========== =========== =========== *Re-stated in accordance with IFRS Consolidated statement of changes in equity Share capital Share Premium Share Options reserve Retained losses Total Equity £ 000's £ 000's £ 000's £ 000's £ 000's Balance at1 January 2006 3,603 26,588 66 (20,428) 9,830 Loss forthe - - - (397) (397)period Totalrecognisedincome andexpense for the period 3,603 26,588 66 (20,825) 9,432 Shares issued during period 4 935 - - 939 Share Option charge - - 37 - 37 ------- -------- ------- -------- ---------Balance at30 June 2006 3,607 27,524 £103 (20,825) £10,408 ======= ======== ======= ======== ========= Balance at1 January 2007 3,607 27,542 180 (21,414) 9,915 Loss forthe period - - - (730) (730) Totalrecognisedincome andexpensefor the 3,607 27,542 180 (22,144) 9,185period Sharesissued 1 177 - - 179duringperiod ShareOption - - 137 - 137charge ------- -------- ------- -------- ---------Balance at30 June 2007 3,608 27,719 318 (22,144) 9,501 ======= ======== ======= ======== ========= Summary Cash Flow Statement 6 months to 30 June 2007 6 months to 30 June 2006 12 Months to 31 December 2006 Unaudited Unaudited Audited As restated* As restated* £ 000's £ 000's £ 000's Net cashoutflow fromoperatingactivities (526) (382) (972) --------- --------- ---------- Investing activities Interest received 54 64 123Investment inIntangible assets (344) (235) (429)Purchase of Propertyplant & equipment (36) (22) (117) --------- --------- ----------Net cash used in investing activities (326) (193) (424) --------- --------- ---------- Financing activities Proceeds of issue ofordinary share capital 179 939 957Repaymentsof borrowings (7) - (24) --------- --------- ----------Net cash inflow fromfinancing activities 172 939 933 --------- --------- ---------- Net(decrease)/increase incash and cash (680) 365 (462)equivalents Cash and cashequivalentsat the 2,517 2,979 2,979beginningof the year Effect of foreignexchange rate changes (6) 25 0 --------- --------- ----------Cash and cashequivalents 1,831 3,369 2,517at end of year ========= ========= ========== *Re-stated in accordance with IFRS Notes to the cashflow statement 6 months to 30 June 2007 6 months to 30 June 2006 12 Months to 31 December 2006 Unaudited Unaudited Audited As restated* As restated* £ 000's £ 000's £ 000's Loss from Operations (784) (462) (1,190) Adjustment for: Amortisationand impairmentof Intangible fixed assets 27 24 53Depreciationof propertyplant & equipment 37 44 67Share basedpayments 137 37 114Decrease/(Increase) in inventories (41) (6) (117)Decrease/(Increase) in receivables (28) (55) (97)Increase inpayables 39 36 207 ---------- ---------- -----------Cash utilised (612) (382) (963)by operations ---------- ---------- ----------- Corporationtax received/(paid) 87 - -Interest paid - - (8) ---------- ---------- -----------Net cash (outflow)from operating activities (526) (382) (972) ========== ========== =========== *Re-stated in accordance with IFRS Notes To The Interim Results:- 1. Basis of preparation The Group's interim results for the half year ended 30 June 2007 have beenprepared in accordance with International Financial Reporting Standards (IFRS)for the first time and on a historical basis. As a consequence, a number of theaccounting policies adopted in the preparation of these statements are differentto those adopted in preparing the financial statements for the year ended 31December 2006, which were prepared in accordance with UK Generally AcceptedAccounting Practice (UK GAAP). The comparative figures are an abridged version of the Group's full financialstatements, adjusted for the impact of IFRS accounting policies, and, togetherwith other financial information contained in these interim results, do notconstitute statutory financial statements of the Group within the meaning ofsection 240 of the Companies Act 1985. Statutory financial statements for the year ended 31 December 2006 have beenfiled with the Registrar of Companies for England and Wales and have beenreported on by the Group's auditors. The report of the auditors was notqualified and did not contain a statement under section 273(2) or (3) of theCompanies Act 1985. The Group has adopted IFRS from 1 January 2006, the date of transition.Reconciliations and descriptions of the impact of IFRS are shown in the appendixto this statement. 2. Basis of consolidation The consolidated profit and loss account and balance sheet include the financialstatements of the company and its subsidiary undertakings made up to 30 June2007. 3. Share capital During the period the following shares and warrants were issued: On 15th January 2007, 217,771 Placing Warrants over Ordinary Shares of 0.02pwere issued at a price of 4p raising £8,711. On 5th February 2007, 893,696 Placing Warrants over Ordinary Shares of 0.02pwere issued at a price of 4p raising £35,748. On 15th February 2007, 1,425,072 "B" Warrants over Ordinary Shares of 0.02p wereissued at a price of 4p raising £57,002. On 7th March 2007, 1,917,050 "B" Warrants over Ordinary Shares of 0.02p wereissued at a price of 4p raising £76,682. On 2nd April 2007, 1,400,360 "C" Warrants over Ordinary Shares of 0.02p wereissued at a price of 0.02p raising £280. On 20th June 2007, 1,000,000 "C" Warrants over Ordinary Shares of 0.02p wereissued at a price of 0.02p raising £200. 4. Dividends No dividend is proposed for the period ended 30 June 2007. 5. Taxation No taxation is expected to arise on the results for the period. 6. Loss per Share The loss per share for the six months ended 30 June 2007 has been calculated onthe basis of the loss after taxation for the period of (£573,000) (June 2006:(£397,000) as restated, and December 2006: (£986,000) as restated) and theweighted average number of shares in issue during the period of 315,822,799(2006: 307,892,658). 7. Segmental reporting The Geographical segmental reporting by destination of sales was as follows: Revenue 30-Jun-07 30-Jun-06 31-Dec-06 £'000 £'000 £'000 UK 3 7 18Europe 48 127 158North America 50 63 181Rest of World 9 19 22 -------- -------- -------- 110 216 379 ======== ======== ======== Operating (Loss) UK (31) (28) (57)Europe (314) (300) (496)North America (431) (102) (569)Rest of World (8) (32) (68) -------- -------- -------- (784) (462) (1,190) ======== ======== ======== 8. Distibution The interim statement will be made available on the company's website atwww.timestrip.com. Copies may also be obtained from Company Secretary:International Registrar Limited, Finsgate, 5-7 Cranwood Street, London, EC1V 9EE APPENDIX - Transition Statement Introduction Timestrip Plc ("Timestrip") has previously prepared its consolidated FinancialStatements under United Kingdom Generally Accepted Accounting Practice (GAAP).With effect from 1 January 2007, it is required to prepare its consolidatedFinancial Statements in accordance with International Financial ReportingStandards (IFRS) as adopted by the European Union. The Group has adopted IFRS from 1 January 2006, the date of transition. Thefirst full set of audited Financial Statements prepared under IFRS will be forthe year ended 31 December 2007, and the first interim report prepared underIFRS is for the half year ended 30 June 2007. The IFRS transition statement has been prepared to explain the impact on thereported result of Timestrip and to set out the changes to the accountingpolicies of the group together with provision of reconciliations of therestatement of previously published comparative financial information. References to IFRS throughout this document refer to the application ofInternational Accounting Standards and International Financial ReportingStandards. Overview of impact of adoption of IFRS Conversion to IFRS affects Timestrip's reporting, particularly in respect ofintangible assets and capitalised development expenditure. It does not affectthe cashflows or the underlying prospects of the business; however, theimplementation of the new standards may result in increased volatility inreported results due to changes in accounting for intangible assets anddevelopment expenditure. It has not been possible to separately identify development expenditure whichmet the criteria for capitalisation prior to the date of transition. Thereforeno capitalisation was performed as at the date of transition. Revised group accounting policies under IFRS. The following accounting policies represent changes from the accounting policiesstated in the financial statements for the year ended 31 December 2006. Theremaining accounting policies remain the same as in the financial statements forthe year ended 31 December 2006 which are consistent with IFRS. Goodwill All business combinations are accounted for by applying the purchase method.Goodwill represents amounts arising on acquisition of subsidiary undertaking,Timestrip UK Limited. In respect of business acquisitions, goodwill representsthe difference between the cost of acquisition and the fair value of the netidentifiable assets acquired. Goodwill is allocated to cash generating units andis now no longer amortised but is tested annually for impairment at a consistenttime each year. Goodwill is now stated at cost or deemed cost less anyaccumulated impairment losses. Timestrip UK Limited has a product which is unique in the market place and isable to cheaply and easily provide a record of elapsed time in the key ambienttemperatures of room, fridge and freezer. In addition, the company has alsospent many years working on the research and development associated with theunderlying diffusion technology and it is believed that this creates asignificant barrier to entry to any potential competition. Timestrip iscurrently one of the leading companies in the world for understanding microndiffusion. Finally, the company has spent significant money successfullyapplying for global patents for the technology which further adds to theprotection. Hence, based on these facts the directors are of the opinion that noimpairment is necessary. Internally-generated Intangible Assets - Research and Development Expenditure Expenditure on research activities is recognised as an expense in the period inwhich it is incurred. An internally-generated intangible asset arising is recognised only if all ofthe following conditions are met: • an asset is created that can be identified ;• it is probable that the asset created will generate future economic benefits; and• the development cost of the asset can be measured reliably. Internally-generated intangible assets are amortised on a straight-line basisover their useful lives. Where no internally-generated intangible asset can berecognised, development expenditure is recognised as an expense in the period inwhich it is incurred. Transition statement from UK GAAP to IFRS as at 1 January 2006 Consolidated UK GAAP at 1 January Goodwill Amortisation IFRS at 1 January balance sheet 2006 IAS 38 2006 £'000 £'000 £'000 Non current assetsGoodwill 5,408 235 5,642Other intangibleassets 931 - 932Property, plant &equipment 304 - 304 ---------- --------- -------- 6,643 235 6,878 ---------- --------- --------Current assetsInventory 66 - 66Trade and otherreceivables 194 - 194Cash and cashequivalents 2,979 - 2,979 ---------- --------- -------- 3,240 - 3,240 ---------- --------- -------- ---------- --------- --------Total Assets 9,883 235 10,118 ---------- --------- -------- Current LiabilitiesTrade andother payables 208 - 208Bank overdraftsand loans 14 - 14 ---------- --------- -------- 222 - 222 ---------- --------- -------- Non-current LiabilitiesBank Loans 67 - 67 ---------- --------- --------Total Liabilities 289 - 289 ---------- --------- -------- ---------- --------- --------Net Assets £9,594 £235 £9,829 ========== ========= ======== Equity Share Capital 3,603 - 3,603Share Premium Account 26,588 - 26,588Share Options Reserve 66 - 66Retained losses (20,663) 235 (20,428) ---------- --------- -------- £9,594 £235 £9,829 ========== ========= ======== Transition statement from UK GAAP to IFRS - 30 June 2006 Income UK GAAP at 30 June 2006 Goodwill Amortisation IAS 38 IFRS at 30 June 2006statement £'000 £'000 £'000 Revenue 216 - 216Cost of Sales (139) - (139) ---------- --------- --------- Gross Profit 77 - 77 Administrative expenses (679) 141 (538) Loss from Operations (603) 141 (462)Investment Revenue 64 - 64 ---------- --------- ---------Loss before tax (539) 141 (397) Taxation - - - ---------- --------- ---------Loss for the period £ (539) £ 141 £ (397) ========== ========= ========= Transition statement from UK GAAP to IFRS - 30 June 2006 Consolidated UK GAAP at 30 June 2006 Goodwill Amortisation IAS 38 IFRS at 30 June 2006Balance sheet £'000 £'000 £'000 Non current assetsGoodwill 5,267 376 5,643Other intangibleassets 1,148 - 1,148Property,plant & equipment 252 - 252 ---------- ----------- -------- 6,667 376 7,043 ---------- ----------- --------Current assetsInventory 72 - 72Trade andother receivables 250 - 250Corporation tax 0 - 0Cash and cashequivalents 3,369 - 3,369 ---------- ----------- -------- ---------- ----------- -------- 3,691 - 3,691 ---------- ----------- -------- ---------- ----------- --------Total Assets 10,358 376 10,734 ---------- ----------- -------- Current LiabilitiesTrade andother payables (234) - (234)Bank overdraftsand loans (14) - (14)Obligationsunder finance leases (6) - (6) ---------- ----------- -------- (254) - (254) ---------- ----------- --------Non-current LiabilitiesBank Loans (60) - (60)Obligationsunder finance leases (13) - (13) ---------- ----------- --------Total Liabilities (326) - (326) ---------- ----------- -------- ---------- ----------- --------Net Assets £10,032 £376 £10,408 ========== =========== ======== EquityShare Capital 3,607 - 3,607Share Premium Account 27,524 - 27,524Share Options Reserve 103 - 103Retained losses (21,202) 376 (20,825) ---------- ----------- -------- £10,032 £376 £10,408 ========== =========== ======== Under International Accounting Standard 38: Intangible assets (IAS 38) goodwill is no longeramortised on a straight line basis, but instead is subject to annual impairment testing underInternational Accounting Standard 36 (IAS 36). Goodwill totalling £376,183 which had previouslybeen amortised to the profit and loss account has been reinstated in the balance sheet. Transition statement from UK GAAP to IFRS - 31 December 2006 Income UK GAAP at Goodwill Research & IFRS at 31 statement 31 December Amortisation Development December 2006 IAS 38 IAS 38 2006 £'000 £'000 £'000 £'000 Revenue 379 - - 379Cost of sales (281) - - (281) -------- ---------- --------- -------- Gross Profit 98 - - 98 Administrativeexpenses (1,707) - 419 (1,288) Loss fromOperations (1,609) - 419 (1,190)Investment Revenue 123 - - 123Finance costs (8) - - (8) -------- ---------- --------- --------Loss before tax (1,495) - 419 (1,075) Taxation 90 - - 90 -------- ---------- --------- --------Loss for the period (1,405) - 419 (985) ======== ========== ========= ======== Transition statement from UK GAAP to IFRS - 31 December 2006 Consolidated UK GAAP at Goodwill Research IFRS at 31 balance sheet 31 December Amortisation & Development December 2006 IAS 38 IAS 38 2006 £'000 £'000 £'000 £'000 Non current assetsGoodwill 5,408 235 - 5,643Other intangibleassets 901 - 419 1,320Property,plant & equipment 372 - - 372 ---------- --------- --------- -------- 6,680 235 419 7,335 ---------- --------- --------- --------Current assetsInventory 183 - - 183Trade andother receivables 186 - - 186Corporation tax 195 - - 195Cash and cashequivalents 2,517 - - 2,517 ---------- --------- --------- -------- 3,082 - - 3,082 ---------- --------- --------- -------- ---------- --------- --------- --------Total Assets 9,762 235 419 10,416 ---------- --------- --------- -------- Current LiabilitiesTrade andother payables 404 - - 404Bank overdraftsand loans 21 - - 21Obligationsunder financeleases 6 - - 6 ---------- --------- --------- -------- 430 - - 430 ---------- --------- --------- --------Non-current LiabilitiesBank Loans 52 - - 52Obligationsunder financeleases 18 - - 18 ---------- --------- --------- --------Total Liabilities 501 - - 501 ---------- --------- --------- -------- ---------- --------- --------- --------Net Assets £9,261 £235 £419 £9,915 ========== ========= ========= ======== EquityShare Capital 3,607 - - 3,607Share PremiumAccount 27,542 - - 27,542Share OptionsReserve 180 - - 180Retained losses (22,068) 235 419 (21,414) ---------- --------- --------- -------- £9,261 £235 £419 £9,915 ========== ========= ========= ======== Under International Accounting Standard 38: Intangible assets (IAS 38) goodwill is no longer amortised on a straight line basis, but instead is subject to annual impairment testing under International Accounting Standard 36 (IAS 36). Goodwill totalling £235,114 which had previously been amortised to the profit and loss account has been reinstated in the balance sheet.Under International Accounting Standard 38: Intangible assets (IAS 38) the criteria for the recognition of expenditure on research and development allow for the capitalisation of expenditure previously expensed. The total expenditure for the year ended 30 December 2006 which it was allowable to capitalise was £419,193. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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