31st Mar 2006 07:02
Polaron PLC31 March 2006 31 March 2006 Polaron plc Interim results Polaron plc, (LSE: POL) today announces its interim results for the six monthsto 31 December 2005. Key Financial Metrics • Turnover up 47% to £12.09m (2004/5: £8.23m) o Controls division saw revenue growth of 76% o The Nanotechnology division saw revenue decrease by 38%• Gross profit up 27% to £4.90m (2004/5: £3.85m)• Strong performance in controls division with operating profits, excluding goodwill amortisation, up by 87% to £1.16m (2004/5: £0.62m)• Adjusted PBT* £0.43m (2004/5: £0.75m) a reduction of 57% largely as a result of losses in the Nanotechnology division of £0.76m (2004/5: Loss £0.29m)• Adjusted EPS* 2.2p per share (2004/5: 3.4p per share)• Interim dividend of 0.45p per share * adjustment relates to the exclusion of amortisation of goodwill and loss ondisposal Operational Highlights • Focus remains on delivering shareholder value• Controls o Strengthened with acquisition of DMS Controls Ltd in July 2005 for up to £3.7m o Several major project wins o Development of two new lighting control product ranges for commercial market• Nanotechnology o Disposal of Vacuum Chamber business completed on March 31st 2006 for £200,000 o Disposal of 3DAP business well advanced• Disposal of Software republishing business in September 2005 for £0.18m Joe Stelzer, Chief Executive Officer, noted: "Since flotation, our focus has remained on delivering value to shareholders.This has been achieved through a mixture of organic and acquisitive growth, aswell as the prudent divestment of loss-making subsidiaries. Despite thepotential inherent in the nanotechnology market and the technical achievementsof the 3DAP, maintaining a commitment to shareholder value has led to thedecision to focus the company on the profitable Controls business. The provenstability of this business combined with the opportunities for growth gives theBoard confidence in the future development of the company in its morestream-lined form." Enquiries: Polaron plc Tel: 01923 495 513Joe Stelzer, Chief Executive OfficerFraser Searle, Finance Director Financial Dynamics Tel: 020 7831 3113Juliet Clarke / Hannah Sloane Introduction Polaron's stated strategy has been to create a two stranded business - Controls& Nanotechnology. This was based on the premise that the Nanotechnology divisionrepresented an opportunity to enter a new market with leading edge technologywhilst the Controls division offered the platform to buy and build a significantoperation in the growing intelligent buildings market. While the Controls business has continued to grow well, achieving a mixture ofmajor contract wins and new product development in the first half of the currentfinancial year, the Nanotechnology division has been challenged in turning salesprospects and enhanced machine performance into orders. Following a strategicreview, the Board has decided to dispose of the Nanotechnology division andfocus on growing the Controls division. As has been announced separately today, the Nanotechnology division's vacuumsystems business has been sold and we are in advanced negotiations to dispose ofthe 3DAP business. Financial Performance Turnover for the six months to 31 December 2005 ("2005/6") rose by 47% to£12.09m, compared with £8.23m for the six months ended 31 December 2004 ("2004/5"). Strong growth in the Controls business, which grew by 76% to £11.17m, waspartially offset by a decrease of £0.44m in the Nanotechnology business, due tono 3DAP shipments, and the disposal of FastTrak Software Publishing Ltd ("FastTrak"), the software republishing business, in September 2005, whichcontributed £0.20m of turnover in 2005/6, compared with £0.75m for the six monthperiod in 2004/5. Part of the growth in the Controls business was due to thecontribution from DMS Controls Limited ("DMS") of £3.19m, which was acquired inJuly 2005. Gross profit in 2005/6 increased by 27% to £4.90m (2004/5: £3.85m), offset by areduction in gross margins from 47% in 2004/5 to 41% in 2005/6. The decrease ingross margins is primarily due to lower margins in the Nanotechnology business,which fell from 35% in 2004/5 to 24% in 2005/6, and the Controls business, whichfell from 50% in 2004/5 to 41% in 2005/6. The fall in the Controls business'gross margins is due to the acquisition of DMS, which operated in line withexpectations with a gross margin of 25% in 2005/6. Distribution expenses increased from £0.34m in 2004/5 to £1.08m in 2005/6,reflecting higher sales volumes and six months of costs in respect of theacquisitions in 2004/5. Administrative expenses, excluding depreciation, amortisation and exceptionalitems, increased from £2.57m in 2004/5 to £3.01m in 2005/6, primarily due to theadministrative expenses of DMS, which amounted to £0.36m and six months ofexpenses in respect of the acquisitions of iLight and Rossula in 2004/5,partially offset by only three months of expenses from FastTrak. Goodwill amortisation increased from £0.23m in 2004/5 to £0.51m, due to theamortisation of the goodwill arising from the DMS acquisition in July 2005 and afull six months' charge in respect of the acquisitions in 2004/5. Depreciation and other amortisation increased from £0.18m in 2004/5 to £0.26m in2005/6 due to higher levels of capital expenditure. Exceptional costs in 2004/5 amounted to £0.25m and relate to redundancy andrestructuring costs in respect of the acquired businesses. Research and development costs increased from £0.24m in 2004/5 to £0.31m in 2005/6 due to increased levels of expenditure in the Controls and Nanotechnologybusinesses. Underlying business performance has shown a steady improvement with a strongperformance in the Controls business, which achieved a 87% increase in operatingprofits excluding goodwill amortisation and exceptional items from £0.62m to£1.16m in 2005/6 which was offset by widening losses in the Nanotechnologybusiness, which increased from £0.15m to £0.62m in 2005/6 due to lower 3DAPdeliveries and increased operating costs. The loss on disposal in 2005/6 relates to FastTrak, which was sold in September2005. Net finance costs increased from £0.01m in 2004/5 to £0.12m in 2005/6 due to anincrease in borrowings and a charge of £0.05m in respect of the accretion ofdeferred consideration. The tax charge decreased from £0.21m in 2004/5 to £0.12m in 2005/6 due to lowerlevels of profitability and a credit of £0.03m in respect of prior periods. Cash inflow from operations was £0.26m in 2005/6, compared with £0.40m,reflecting lower operating profits, as a result of higher depreciation andamortisation charges, and an increase in working capital. Cash outflow from acquisitions and capital investment amounted to £0.78m and£0.42m, compared with £1.40m and £0.35m in 2004/5, respectively. At 31 December 2005, net debt was £3.42m, compared with net debt of £0.78m at 30June 2005. The increase in net debt was due primarily to the classification of£1.3m ordinary shares to be issued as deferred consideration to debt under FRS25and acquisitions during 2005/6 of £0.78m, capital expenditure of £0.42m,partially offset by operational cash flow of £0.26m. At 31 December 2005, the Group had undrawn loan facilities of £1.45m. The loss per share in 2005/6 was 1.9p compared with earnings per share of 0.5pin 2004/5. The adjusted earnings per share which excludes goodwill amortisationand exceptional items was 2.2p per share compared with 3.4p in 2004/5. An interim dividend of 0.45p per share will be payable on 15 May 2006 toshareholders on the register on 18th April 2006. Acquisitions and Disposals DMS Controls, one of the UK's largest integrators of Trend and ALC BuildingManagement systems, was acquired in July 2005 for a maximum consideration of£3.7m satisfied by a mixture of shares and cash. The maximum amount payable willbe paid upon reaching profits of £700,000 before tax during the financial yearending 30 June 2006. Our Software business, FastTrak Software Publishing Ltd was sold to itsmanagement team on 21st September 2006 for £177,000, of which £100,000 was paidup on completion and the balance is payable over 5 years. The vacuum systems business of our Nanotechnology division Oxford NanoscienceLtd was sold today for approximately £200,000 to Weltonbridge Limited, a companyowned by its former Managing Director Richard Davies. The consideration price ispayable by the issue of 200,000 preference 5% shares of £1 each in the acquiringcompany Weltonbridge Limited. The disposal of the Atom Probe division is at anadvanced state of negotiations. Nanotechnology Turnover during 2005/6 was £0.71m (2004/5: £1.15m), a decrease of 38%. Lossesin the business were substantially higher, due to the loss of gross profitcontribution of one atom probe and also as a result of an enlarged operatingstaff supporting the 3DAP development programme. Whilst the lack of conversionof sales prospects into orders has been disappointing, the Board would like torecognise that the achievements of the research and development team have beenoutstanding. The creation of a high resolution wide angle version of the atomprobe and the launch of the laser atom probe have raised the standard for AtomProbe analysis. Controls Turnover during 2005/6 was £11.17m (2004/5: £6.33m), an increase of 76%. Partof this increase is due to the acquisition of DMS Controls Limited, whichcontributed turnover of £3.19m. DMS Controls has grown rapidly since acquisitionand has won several million pounds worth of orders in the growing London officerefurbishment market. Whilst the DMS business achieves good operating marginsat the net level, it is expected that the gross margin of the Controls divisionwill reflect its proportion of lower gross margin. Central to the strategy of acquiring DMS has been the development of acomplementary range of lighting control products for use in large offices. Thenew products will be launched under the division's iLight brand at Europe'smajor lighting show Licht & Bild (Lighting + Building) in Frankfurt in April.Coincident with the product launch has been the recruitment of sales andtechnical staff with industry specific knowledge. The benefits of the increasedproduct range, larger sales force and synergistic cross selling opportunitiesare expected to be seen in the next financial year. The Controls division now operates three core businesses: Products (operating asiLight and Zero88); Systems (operating as DMS Controls and Polaron IntegratedSystems) and Distribution (Marata and Lightfactor). There is scope for furtherrationalisation and this will continue during the second half of this financialyear. The outlook for the Controls division remains strong both in terms of newproduct sales and increased synergy between the sales teams. Software Turnover for the three months of trading during 2005/6, prior to disposal, was£0.20m (2004/5: £0.75m). Just prior to being sold, its major republishingcontract with Magix AG was terminated. One of the terms of the business sale wasthat Polaron would receive the majority of the proceeds of any settlementresulting from litigation in respect of the circumstances surroundingtermination. Proceedings are expected to be filed shortly. Board Changes As part of the restructuring resulting from the decision to dispose of theNanotechnology and Software divisions and our continuing focus purely on theControls businesses, the Group Managing Director Simon Redvers has today steppeddown from the Board but is expected to continue in the business until the end ofsummer 2006. The Board would like to thank him for his contribution to thegrowth of the business and wishes him well in his future endeavours. I am delighted to confirm that our Operations Director Simon Sparrow is to jointhe Board with immediate effect. Simon has been with the Company for over 15years, in a variety of technical and operational roles, and the Board looksforward to his further contribution in the operations of the Controls division. Outlook Since the Company's flotation in March 2004, we have increased our turnover byover 100% and have completed seven M&A transactions, devoting our efforts toexploiting two business opportunities in a profitable fashion. Having reachedthe conclusion that we were not going to be able to provide our shareholderswith an acceptable return in the emerging Nanotechnology market and havingachieved consistent profitability and success within the Controls division, wehave decided to develop a more focused business and re-direct our effortstowards our buy and build strategy solely in the Controls market. Our core beliefs of running the business for profit and with prudent risk takinghas been borne out with our financial state being strong despite the lossesincurred in Oxford Nanoscience Ltd, the disposal of which is expected by the endof the financial year. I believe that our abilities to understand technology,acquire wisely and streamline operations are the key ingredients to our futureprofitable growth. These factors, together with the proven performance of theControls division thus far, give the Board confidence in the Company's futuregrowth. Joe StelzerChief Executive Officer31st March 2006 CONSOLIDATED PROFIT AND LOSS ACCOUNTfor the six months ended 31 December 2005 Unaudited Unaudited Audited Restated Restated 6 months to 6 months to Year to 31December 31 December 30 June 2005 2004 2005 Notes £'000 £'000 £'000TurnoverContinuing operations 7,989 5,086 10,167Acquisitions 3,186 1,835 5,763Discontinued operations 910 1,307 2,834 ---------- ---------- ---------- 2 12,085 8,228 18,764Cost of sales 7,187 4,379 10,056 ---------- ---------- ----------Gross profitContinuing operations 3,735 2,695 4,914Acquisitions 794 834 2,577Discontinued operations 369 320 1,217 ---------- ---------- ---------- 4,898 3,849 8,708 Distribution expenses 1,084 344 2,335 Administrative expenses Research and development costs 312 239 531 Goodwill amortisation 508 225 548 Exceptional items 12 - 252 472 Other administrative expenses 2,957 2,508 4,481Total administrative expenses 3,777 3,224 6,032Other operating income 3 6 10 ---------- ---------- ----------Group operating profitContinuing operations 63 515 897Acquisitions 193 2 (281)Discontinued operations (216) (230) (265) ---------- ---------- ---------- 40 287 351(Loss)/profit on disposal (58) - 960 ---------- ---------- ---------- (Loss)/profit on ordinary activities before (18) 287 1,311interest and taxationInterest receivable and similar income 13 3 5Interest payable and similar charges (135) (15) (55) ---------- ---------- ----------(Loss)/profit on ordinary activities before 2 (140) 275 1,261taxationTaxation on profit on ordinary activities 9 123 207 536 ---------- ---------- ----------(Loss)/profit for the period/year (263) 68 725 ---------- ---------- ----------(Loss)/earnings per share - pence 3Basic (1.9) 0.5 5.3Continuing (0.3) 2.2 7.2Diluted (1.9) 0.5 5.2 CONSOLIDATED BALANCE SHEET31 December 2005 Unaudited Unaudited Audited Restated Restated As at As at As at 31December 31 December 30 June 2005 2004 2005 Notes £'000 £'000 £'000Fixed Assets Intangible assets 7,025 4,049 4,201 Tangible assets 3,054 3,059 3,072 Fixed asset investments 11 12 11 ---------- ---------- ---------- 10,090 7,120 7,284Current Assets Stocks 2,530 2,881 2,219 Debtors 4,730 4,313 4,091 Cash at bank and in hand 7 - 646 196 ---------- ---------- ---------- 7,260 7,840 6,506 Creditors: amounts falling due within one year 5 6,932 5,649 3, 845 ---------- ---------- ----------Net current assets 328 2,191 2,661 ---------- ---------- ----------Total assets less current liabilities 10,418 9,311 9,945 Creditors: amounts falling dueafter more than one year 6 1,491 699 726 Provision for liabilities and charges 151 138 130 ---------- ---------- ---------- 1,642 837 856 ---------- ---------- ---------- 8,776 8,474 9,089 ========== ========== ==========Capital and Reserves Called up share capital 1,394 1,386 1,386 Share premium account 4,067 4,067 4,067 Revaluation reserve 1,465 1,465 1,465 Other reserves 500 434 433 Profit and loss account 1,350 1,122 1,738 ---------- ---------- ----------Shareholders' funds (equity) 10 8,776 8,474 9,089 ========== ========== ========== CONSOLIDATED CASH FLOW STATEMENTfor the six months ended 31 December 2005 Unaudited Unaudited Audited 6 months to 6 months to Year to 31 December 31 December 30 June 2005 2004 2005 Notes £'000 £'000 £'000 Net cash inflow from operating activities 4 262 403 813 Net cash outflow from returns on investments and servicing of finance (64) (12) (50) Taxation Corporation tax paid (164) (58) (512) Capital expenditure and financialinvestment Payments to acquire tangible fixed (242) (252) (375) assets Payments to acquire intangible fixed (181) (90) (526) assets Payments to acquire fixed asset - (11) (10) investments Proceeds from disposal of tangible - - 83 assets ---------- ---------- ----------Net cash outflow from capital expenditureand financial investment (423) (353) (828) Acquisitions and disposals Purchase of interests in subsidiary (742) (1,299) (1,381) companies Net overdrafts acquired with subsidiary - (100) (79) companies Net proceeds from disposal of interests in subsidiary companies (36) - - Proceeds from disposal of part of - - 1,232 pressure sensing business ---------- ---------- ---------- Net cash outflow from acquisitions and (778) (1,399) (228)disposals Equity dividend paid (125) (34) (76) ---------- ---------- ----------Cash outflow before use of liquidresources and financing (1,292) (1,453) (881)Management of liquid resources Decrease in short term deposits - 200 200 Financing New loans - 500 500 Capital element of finance leases repaid (158) (117) (242) ---------- ---------- ----------Net cash (outflow)/inflow from financing (158) 383 258 ---------- ---------- ----------Decrease in cash 7,8 (1,450) (870) (423) ========== ========== ========== NOTES TO THE INTERIM FINANCIAL STATEMENTfor the six months ended 31 December 2005 1 Basis of preparation The interim results have been prepared using accounting policies consistent withthose used in the preparation of the Annual Report and Accounts for the yearended 30 June 2005, apart from the adoption of FRS 21, FRS 22 and FRS 25. FRS 21 requires account to be taken of events occurring after the Balance Sheetdate and results in dividends proposed by the Company being recognised in theperiod in which they are declared. The comparative accounts have been adjustedto reflect this change. FRS 22 relates to the calculation of earnings per sharebut this adjustment has had no material impact on the results. FRS 25 requiresthat shares to be issued as consideration to be reclassified from share capitalto creditors and the comparative accounts have been adjusted to reflect thischange. The financial information contained in this interim report does not constitutestatutory accounts within the meaning of section 240 Companies Act 1985. Thoseaccounts have been filed with the Registrar of Companies and received anunqualified audit report which did not contain a statement under section 237(2)or (3) Companies Act 1985. Acquisitions The acquired businesses have been accounted for using the acquisition method ofaccounting and the financial results of these businesses are separatelydisclosed in the consolidated profit and loss account under acquisitions.Acquisitions made in the six months ended 31 December 2005 are shown as part ofcontinuing operations. Disposals On 21 September 2005, the Company sold its software republishing business,FastTrak Software and the results of this business have been presented as adiscontinued operation. On 31 March 2006, the Company sold its vacuum chamber business ("CVT"). As aresult of this disposal the results of CVT for the six months ended 31 December2005 and 2004 and the year ended 30 June 2005 have been presented as adiscontinued operation. CVT is reported as part of the Nanotechnology businesssegment. 2 Segmental analysis by class of business Unaudited Unaudited Audited 6 months to 6 months to Year to 31 December 31 December 30 June 2005 2004 2005 £'000 £'000 £'000TurnoverControls 11,174 6,331 14,485Nanotechnology - continuing operations 1 590 1,446Nanotechnology - discontinued operation 709 556 1,446Software republishing - discontinued operation 201 751 1,387 ---------- ---------- ---------- 12,085 8,228 18,764 ========== ========== ==========Operating profit, excluding goodwill amortisationControls 1,164 618 1,044Nanotechnology - continuing operations (400) 124 120Nanotechnology - discontinued operation (220) (278) (305)Software republishing - discontinued operation 4 48 40 ---------- ---------- ---------- 548 512 899 ========== ========== ==========(Loss)/profit before taxControls 612 517 1,678Nanotechnology - continuing operations (533) (10) (148)Nanotechnology - discontinued operation (223) (280) (309)Software republishing- discontinued operation 4 48 40 ---------- ---------- ---------- (140) 275 1,261 ========== ========== ========== 3 Earnings per share Unaudited Unaudited Audited 6 months to 6 months to Year to 31 December 31 December 30 June 2005 2004 2005Weighted average number of sharesBasic 13,860,639 13,658,289 13,758,080Diluted 15,190,239 13,750,732 13,862,327 Earnings (£'000)Basic and diluted (263) 68 725Goodwill amortisation 508 225 548Exceptional costs/income, net of tax where 58 176 (342)applicable ---------- ---------- ----------Adjusted earnings 303 469 931 ---------- ---------- ----------(Loss)/earnings from continuing operations (44) 300 994 (Loss)/earnings per share - penceBasic EPS (1.9) 0.5 5.3Diluted (1.9) 0.5 5.2Adjusted 2.2 3.4 6.8Continuing operations (0.3) 2.2 7.2 Adjusted earnings per share has been calculated to provide a better understanding of the underlyingperformance of the group 4 Reconciliation of operating profit to net cash inflow from operatingactivities Unaudited Unaudited Audited 6 months to 6 months to Year to 31 December 31 December 30 June 2005 2004 2005 £'000 £'000 £'000Operating profit 40 287 351Amortisation of intangible fixed assets 591 242 599Depreciation of tangible fixed assets 178 163 319(Profit)/loss on disposal of fixed assets (3) 3 (10)(Increase)/decrease in stocks (372) (563) (184)Decrease/(increase) in debtors 182 909 (1,357)(Decrease)/increase in creditors (356) (693) 1,041Other non cash items 2 55 54 ---------- ---------- ----------Net cash inflow from operating activities 262 403 813 ========== ========== ========== 5 Analysis of creditors: amounts falling due within one year Unaudited Unaudited Audited Restated Restated As at 31 As at 31 As at 30 December December June 2005 2004 2005 £'000 £'000 £'000 Bank loans and overdrafts (secured) 1,254 897 -Trade creditors 2,969 2,431 2,129Corporation tax 355 371 221Finance leases 148 189 178Deferred consideration on acquisitions - ordinary 1,362 72 72sharesOther 844 1,689 1,245 ---------- ---------- ---------- 6,932 5,649 3,845 ========== ========== ========== 6 Analysis of creditors: amounts falling due after more than one year Unaudited Unaudited Audited As at As at As at 30 31 December 31 December June 2005 2004 2005 £'000 £'000 £'000 Bank loans (secured) 500 500 500Finance leases 154 199 226Deferred consideration on acquisitions - cash 837 - - ---------- ---------- ---------- 1,491 699 726 ========== ========== ========== 7 Analysis of net debt Restated Audited Unaudited Unaudited Unaudited As at Cash flow Other non cash As at 1 July Items 31 December 2005 2005 £'000 £'000 £'000 £'000Net cashCash at bank and in hand 196 (196) -Bank overdrafts - (1,254) - (1,254) ---------- (1,450)DebtDebt due within one year - - - -Deferred consideration on (72) - (1,290) (1,362)acquisitions- ordinary sharesDebt due after one year (500) - - (500)Finance Leases (404) 158 (56) (302) ---------- ---------- ---------- ----------Net debt (780) (1,292) (1,346) (3,418) ========== ========== ========== ========== 8 Reconciliation of net cash flow to movement in net debt Unaudited Unaudited Audited 6 months to 6 months to Year to 30 31 December 31 December June 2005 2004 2005 £'000 £'000 £'000 Decrease in cash (1,450) (870) (423)Cash (inflow)/outflow from changes in net debt 158 (384) (258)Cash inflow from changes in liquid resources - (200) (200) ---------- ---------- ----------Movement in net debt resulting from cash flows (1,292) (1,454) (881)Debt acquired on acquisitions - (33) (41)Increase in deferred consideration - ordinary (1,290) - -sharesInception of finance leases (56) (125) (259) ---------- ---------- ----------Movement in net debt (2,638) (1,612) (1,181)Opening net debt (780) 401 401 ---------- ---------- ----------Closing net debt (3,418) (1,211) (780) ========== ========== ========== 9 Taxation on profit on ordinary activities Unaudited Unaudited Audited 6 months to 31 6 months to Year to 30 December 31 December June 2005 2004 2005 £'000 £'000 £'000UK corporation taxCurrent tax on profits for the period/year 148 175 503Adjustments to taxation in respect of prior (30) - (22)periodsDeferred taxAccelerated capital allowances and other timing 5 55differences 32 ---------- ---------- ----------Taxation on profit on ordinary activities 123 207 536 ========== ========== ========== The taxation charge has been calculated on the estimated effective tax rate forthe year ended 30 June 2006. 10 Reconciliation of movement in shareholders' funds Restated Restated Unaudited Unaudited Audited 6 months to 31 6 months to Year to 30 December 31 December June 2005 2004 2005 £'000 £'000 £'000 (Loss)/profit for the period/year (263) 68 725Dividends paid (125) (34) (76)Shares issued in respect of deferred consideration 75 700 800Shares to be issued as deferred consideration - 100 - ---------- ---------- ---------- (313) 834 1,449Opening shareholders' funds 9,089 7,640 7,640 ---------- ---------- ----------Closing shareholders' funds 8,776 8,474 9,089 ========== ========== ========== 11 Acquisition of subsidiary undertakings Acquisition of DMS Controls Ltd ("DMS") On 20 July 2005, the Company acquired the entire issued share capital of DMS.The initial consideration paid was £1.4m in cash. A further £800,000 will bepayable in shares on the achievement of pre-tax profits of £400,000 for theperiod ending 30 June 2006. A further maximum consideration of £1.5m will bepayable, satisfied by loan notes (£900,000) and shares (£600,000), uponachieving further pre-tax profits growth to a total of £700,000 or up to £1m ifsuch profits growth does not occur until the period ending 30 June 2007. Provisional fair values Unaudited £'000Tangible fixed assets 17 Debtors 628Cash 528 Creditors 769 ---------- 404Goodwill 3,153 ---------- 3,557 ==========Estimated consideration to be satisfied by:Shares 1,325Cash 2,193 ---------- 3,518Other acquisition costs 39 ----------Cost of investment 3,557 ========== 12 Exceptional items The exceptional costs in the six months ended 31 December 2004 and the yearended 30 June 2005 relate to redundancy and other restructuring costs in respectof the acquired businesses. 13 Post Balance Sheet Events On 31 March 2006, the Company sold part its vacuum chamber business ("CVT") forapproximately £200,000 in exchange for 200,000 of 5% preference shares, with anominal value of £1 each, to be issued by Weltonbridge Ltd. Weltonbridge Ltd,is a company controlled by Richard Davies who was the former Managing Directorof Oxford Nanoscience Ltd, the Nanotechnology division of the Company. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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