30th Apr 2008 07:01
ADDleisure PLC30 April 2008 ADDleisure Plc / Epic: ADE.L / Index: AIM / Sector: Leisure 30 April 2008 ADDleisure Plc ('ADDleisure' or 'the Company') Interim Results ADDleisure Plc, the AIM traded company formed to develop products and servicesin the health and leisure sectors, announces its results for the six monthsended 31 January 2008. Overview •Strong progress across all areas of operations - well positioned for growth •Group revenue up 122% to £1,303,000 (2007: £586,000) •Group pre-tax loss reduced 53% to £421,000 (2007: £900,000) •Healthy cash position with £4.0 million in the bank. Chairman's Statement This has been a positive six months for the Company and I am very happy with theprogress we have made. Having spent three years developing a pioneeringportfolio of health and wellness products and services, your Company has reacheda pivotal stage in its life and is now developing aggressive marketing campaignsfor implementation in the summer of 2008 to strengthen the recognition of itsbrands and kick-start its move into new, highly lucrative markets. Furthermore, we are focused on fully utilising our strategic partnership withour major shareholder, Bupa. This relationship is already opening exciting newdoors for us and will, we believe, help us to fulfil our objective of becoming aleading investor in and provider of health and leisure products and services toboth the UK market and overseas. Financial Results The results for the six months to 31 January 2008 are the first for the Groupunder International Financial Reporting Standards (IFRS). Proportionateconsolidation has been used which requires the Group to consolidate its share ofthe results, assets and liabilities of its joint venture interests (FitbugLimited and Movers and Shapers Limited). I am pleased to report a 122% increase in Group revenue to £1,303,000 (2007:£586,000). The period has seen continued investment in our products and anincrease in costs having strengthened our sales teams. In line with this and theDirectors' expectations, the Group is reporting pre-tax losses of £421,000(2007: £900,000). Once again, the Group's cash position remains strong with £4.0million in the bank. Operations The period under review has seen continued developments and improvements of ourcore products and services, Fitbug, Movers & Shapers and Ez-Systems, and theestablishment of new market opportunities. In each business, the sales teamshave been strengthened and new marketing drives initiated, with positive resultsalready being seen. Total company revenue for each operating division is dramatically improved: •Fitbug (50/50 with Bupa) up 394% to £1,116,300 •Movers & Shapers (50/50 with Bupa) up 470% to £160,000 •Digital Plantation (50.2% interest) up 65% to £495,000 Fitbug Limited, our 50/50 joint venture with Bupa, which offers online personalhealth and well-being services, continues to develop at a considerable pace. Notonly is it enhancing its core technology, but it is also piloting its offeringwith various large multi-national corporates and progressing a number of otherexciting initiatives, which we look forward to updating shareholders on in thenear future. Movers & Shapers, a groundbreaking retail concept for health and fitnessservices, also a 50/50 joint venture with BUPA, has seen similar progress. Itsbrand is being heavily marketed with excellent results and three new stores areplanned to open in June, with more in the pipeline. Our intelligent management software business, Digital Plantation, trading asEz-Systems, in which we hold a 50.2% interest, has seen a high volume ofactivity, with further developments of the product and an increased number ofsubstantial worldwide sales opportunities. To fund the future growth in the above operations, the available cash in theADDleisure group and its joint ventures is £4.5 million. Board Changes As part of our growth strategy we reorganised and appointed new experiencedindustry professionals to complement our existing team. Ben Margolis resignedfrom his position as Finance Director to focus on his new exciting role as ChiefExecutive Officer of Movers and Shapers Ltd and was replaced by Mike Mills, whohas held various directorship positions with leading companies in the leisureindustry. Michael Warshaw, former Executive Chairman of Molton Brown who hasbeen a consultant to ADDleisure for over a year, also joined the Board asNon-Executive Deputy Chairman. Outlook We are operating in an extremely exciting area with huge scope for futuregrowth. We remain committed to advancing our existing products and services,whilst also exploring new innovative ideas to explore new market trends. Ouragreement with Bupa, announced in June 2007, was a great endorsement ofADDleisure and is already opening new exciting avenues for us including anaccelerated expansion into the positive health and wellness territory, currentlyone of the fastest growing areas of the industry. I would like to thank the efforts of our dedicated, hard-working and committedstaff in achieving such significant progress and our shareholders for theircontinued support. We are confident that during the remainder of the year wewill see good growth across all areas of the business and I look forward toreporting further progress in our final results statement in the autumn. Allan FisherChairman30 April 2008 * * ENDS * * For further information visit www.addleisure.com or contact: Mike Mills, FD ADDleisure Plc Tel: 020 7449 1000Mark Percy Seymour Pierce Tel: 020 7107 8000Isabel Crossley/Susie Callear St. Brides Media & Finance Tel: 020 7236 1177 Unaudited Consolidated Income StatementFor the six months ended 31 January 2008 6 months ended 6 months ended Year ended 31 January 2008 31 January 2007 31 July 2007 £'000s £'000s £'000s Revenue 1,303 586 1,324Cost of sales (378) (189) (413) _____ _____ _____ Gross profit 925 397 911 Administrative expenses (1,464) (1,300) (3,057)Other income: Gain on disposalof subsidiaries to joint venture - - 1,942 _____ _____ _____ (539) (903) (204) Finance income 118 3 12Finance expense - - (9) _____ ____ _____ Loss before tax (421) (900) (201)Income tax credit - - 34 _____ _____ _____ Loss for the period (421) (900) (167) ==== ==== ====Attributable to:- Losses applicable to the parent's interest in the group (325) (673) 285 - Losses in the subsidiaries applicable to the minority interests in excess of the minorities' interests in the equity of those subsidiaries (96) (227) (452) _____ _____ _____Losses attributable to theequity holders of the parent (421) (900) (167) ==== ==== ==== Basic and fully diluted loss pershare in pence (Note 2) (0.2) (0.7) (0.1) _____ _____ _____ Unaudited Statement of Changes in EquityFor the six months ended 31 January 2008 Excess of minorities interest in losses over their equity Share Share Merger interest in Accumulated Total capital premium reserve subsidiaries losses equity £'000s £'000s £'000s £'000s £'000s £'000s 1 August 606 1,575 757 (340) (1,377) 1,2212006 Loss andtotalrecognisedincome andexpense for - - - (227) (673) (900)the period Issue ofshares forcash 42 208 - - - 250 ------ -------- ------- ------------- ---------- --------- 31 January 648 1,783 757 (567) (2,050) 5712007 Profit andtotalrecognisedincome andexpense forthe period - - - 161 572 733 Share-basedpayment - - - - 87 87 Issue ofshares toacquireminorityinterests 62 - 562 - 386 1,010 Issue ofshares forcash 303 2,664 - - - 2,967 ------ -------- ------- ------------- ---------- --------- 31 July 1,013 4,447 1,319 (406) (1,005) 5,3682007 Loss andtotalrecognisedincome andexpense for - - - (96) (325) (421)the period Share-basedpayment - - - - 50 50 Issue ofshares forcash 30 270 - - - 300 ------ -------- ------- ------------- ---------- --------- 31 January 1,043 4,717 1,319 (502) (1,280) 5,2972008 ------ -------- ------- ------------- ---------- --------- Unaudited Consolidated Balance SheetAs at 31 January 2008 6 months ended 6 months ended Year ended 31 January 31 January 31 July 2008 2007 2007 £'000s £'000s £'000sAssetsNon-current assetsProperty, plant and equipment 138 141 97Goodwill 595 575 595Other intangible assets 134 137 75Trade and other receivables - - 568 _____ _____ _____ 867 853 1,335 _____ _____ _____Current assetsInventories 44 37 20Trade and other receivables 2,152 342 756Cash and cash equivalents 3,968 118 4,292 _____ _____ _____ 6,164 497 5,068 _____ _____ _____ Total assets 7,031 1,350 6,403 _____ _____ _____ LiabilitiesCurrent liabilitiesTrade and other payables (1,519) (468) (721)Obligations under finance leases (18) (51) (18) _____ _____ _____ (1,537) (519) (739) _____ _____ _____Non-current liabilitiesBorrowings (187) (232) (287)Obligations under finance leases (10) (28) (9) _____ _____ _____ (197) (260) (296) _____ _____ _____ Total liabilities (1,734) (779) (1,035) _____ _____ _____Total net assets 5,297 571 5,368 ==== ==== ====Capital and reserves attributableto equity holders of the companyShare capital 1,043 648 1,013Share premium 4,717 1,783 4,447Merger reserve 1,319 757 1,319Excess of minorities interest inlosses over their equityinterest in subsidiaries (502) (567) (406)Accumulated losses (1,280) (2,050) (1,005) _____ _____ _____Total equity 5,297 571 5,368 ==== ==== ==== Unaudited Consolidated Cash Flow StatementFor the six months ended 31 January 2008 6 months ended 6 months ended Year ended 31 January 31 January 31 July 2008 2007 2007 £'000s £'000s £'000sCash flows from operating activitiesLoss before taxation (421) (900) (201)Adjustments for: - Depreciation and amortisation 49 85 175 - Impairment charge - - 396 - Share-based payments 50 - 87 - Finance income (118) (3) (12) - Finance expense - - 9 - Goodwill disposal - - 595 - Gain on disposal of subsidiaries - - (1,942)(Increase)/decrease ininventories (24) 30 48Increase in trade and otherreceivables (828) (120) (784)Increase in trade and otherpayables 798 127 363Corporation tax credit received - - 34 _____ _____ _____Net cash used in operations (494) (781) (1,232) _____ _____ _____Cash flow from investing activities Purchase of property, plant andequipment (61) (47) (110)Development costs (88) - (28)Finance income 118 3 12 _____ _____ _____Net cash used in investingactivities (31) (44) (126) _____ _____ _____Cash flow from financing activities Issue of ordinary shares for cash 300 250 3,216Cash acquired through jointventure issuing shares for cash - - 1,835Loan proceeds - - 125Loan repayment (99) - (200)Capital repayments of financelease obligations - (12) (26)Finance expense - - (5) _____ _____ _____Net cash generated fromfinancing activities 201 238 4,945 _____ _____ _____Net (decrease)/increase in cashand cash equivalents (324) (587) 3,587Cash and cash equivalents atbeginning of period 4,292 705 705 _____ _____ _____Cash and cash equivalents at endof period 3,968 118 4,292 ==== ==== ==== Notes 1. Basis of preparation and significant accounting policies These interim results of the Company and its subsidiaries ("the Group") for thesix months ended 31 January 2008 have been prepared in accordance withInternational Financial Reporting Standards (IFRS) and International FinancialReporting Interpretations Committee (IFRIC) interpretations as adopted by theEuropean Union and also in accordance with the Companies Act 1985. Thecomparative periods for the six months ended 31 January 2007 and the year ended31 July 2007 have been restated to reflect the adoption of IFRS by the Group. Aspermitted, the Company has chosen not to adopt IAS34 'Interim FinancialReporting'. The information included within this document has been prepared on the basis ofthe recognition and measurement requirements of applicable IFRS and IFRICinterpretations in issue that either are endorsed by the European Commission andeffective (or available for early adoption) at 31 January 2008 or are expectedto be endorsed and effective (or available for early adoption) at 31 July 2008,the Group's first annual reporting date in accordance with IFRS. In preparing these unaudited consolidated interim financial statements,management has amended certain accounting and valuation methods applied in the2007 Annual Report and Accounts to comply with IFRS. The Group accountingpolicies as set out in the 2007 Annual Report and Accounts have been revisedwhere applicable to conform to IFRS. The financial statements for the twelve months ended 31 July 2007 as previouslystated (under UK GAAP) have been reported on by the Company's auditors anddelivered to the Registrar of Companies. The report of the auditors on suchaccounts was unqualified, and did not include references to any matters to whichthe auditors drew attention without qualifying their report, and did not containany statement under Sections 237(2) or 237 (3) of the Companies Act 1985. Therestated adopted IFRS financial information for the year ended 31 July 2007 doesnot constitute statutory accounts as defined in section 240 of the Companies Act1985, however it is anticipated to be consistent with the comparative period forthe statutory accounts for the year ended 31 July 2008, the Group's first annualfinancial statements to be prepared under IFRS. The restated accounting policies as set out in these results have beenconsistently applied to all the periods presented. The adopted IFRS that will beeffective (or available for early adoption) in the annual financial statementsfor the year ending 31 July 2008 are still subject to the possibility of changeas a result of decisions taken by the European Commission on endorsement. As aresult of such changes, the accounting policies cannot be determined withcertainty and therefore may require updating when the annual financialstatements are prepared for the year ending 31 July 2008. The comparative figures in respect of the year ended 31 July 2007 have beenrestated to reflect these adjustments. Reconciliations and descriptions of theeffect of the transition from United Kingdom Generally Accepted AccountingPrinciples to IFRS are provided in note 3. Basis of consolidation The Group Interim Statement consolidates the financial statements of the Companyand its subsidiary undertakings. Acquired companies have been included in the consolidated financial statementsusing the purchase method of accounting when the transaction can be identifiedas a business combination. The Company is required to apply the provisions of s131 of the Companies Act1985, concerning merger relief, where applicable. Any premium on shares issuedis added to the merger reserve. Subsidiaries are entities over which the Group has power to govern the financialand operating policies. The cost of investment in a subsidiary is eliminatedagainst the Group's share in the net assets at the date of acquisition. Allinter-company receivables, payables, income and expenses are eliminated.Subsidiaries are fully consolidated from the date of acquisition, being the dateon which the Group obtains control, and continue to be consolidated until thedate that such control ceases. If the losses applicable to a minority in a consolidated subsidiary exceed thatminority's interest in the subsidiary's equity, then the excess, and any furtherlosses, are allocated against majority interest unless there is a bindingobligation on the minority to make additional investment to cover those losses. On disposal of a subsidiary, the consideration received is compared with thecarrying cost at the date of disposal and the gain or loss is recognised in theincome statement. Where control of a subsidiary undertaking is lost as a result of the subsidiaryissuing equity to a third party the results of the subsidiary are excluded fromthe consolidated income statement from the date that control is lost. Theremaining investment in the former subsidiary undertaking is classified as anassociate, a joint venture or as an "available-for-sale" investment inaccordance with the terms of the relevant transaction. Goodwill Goodwill arising on acquisitions is recognised as an asset and initiallymeasured at cost, being the excess of the cost of the acquired entity over theGroup's interest in the fair value of the assets, liabilities and contingentliabilities acquired. Goodwill which is recognised as an asset is reviewed forimpairment at least annually. Any impairment is recognised immediately in the income statement and is notsubsequently reviewed. Where the fair value of assets, liabilities and contingent liabilities isgreater than the cost, the excess, known as negative goodwill, is recognised inthe income statement immediately. Goodwill arising on business combinations before 1 August 2006 (the date oftransition to IFRS) has been recorded at its carrying value under UK GAAP as at1 August 2006, subject to being tested for impairment at that date. Joint ventures The Group has an interest in a joint venture which is a jointly controlledentity, whereby the venturers have a contractual arrangement that establishesjoint control over the economic activities of the entity. The Group recognisesits interest in the joint venture using proportionate consolidation. The Groupcombines its share of each of the assets, liabilities, income and expenses ofthe joint venture with similar items, line by line, in its consolidatedfinancial statements. The financial statements of the joint venture are preparedfor the same reporting period as the parent company. Adjustments are made wherenecessary to bring the accounting policies into line with those of the Group. Adjustments are made in the Group's financial statements to eliminate theGroup's share of unrealised gains and losses on transactions between the Groupand its jointly controlled entity. Losses on transactions are recognisedimmediately if the loss provides evidence of a reduction in the net realisablevalue of current assets or an impairment loss. Revenue The Group is involved in the development and sale of products in the leisure,health and fitness sectors. Revenue represents the total amount recognised by the Group for goods andservices provided to third parties, excluding VAT and similar taxes. The Group derives its revenue principally from the sale of studio sessions,hardware products and software licences, and fees derived from installations,consultancy, training, support services and maintenance. Revenue from hardwareproducts is recognised on delivery. Support and maintenance revenue is spreadevenly over the period to which the subscription relates. Other revenue isrecognised over the period in which services are provided. Long-term contracts are reflected in the income statement by recording revenueaccording to the value of work carried out and the degree of completion at thebalance sheet date. Full provision is made for anticipated losses on contractsas soon as they are foreseen. Inventories Inventories are valued at the lower of cost and net realisable value. Cost isbased on the cost of purchase on a first in, first out basis. Net realisable value is based on estimated selling price less additional coststo completion and disposal. Trade and other receivables These assets are non-derivative financial assets with fixed or determinablepayments that are not quoted in an active market. They arise principally throughthe provision of goods and services to customers (trade receivables) but alsoinclude other types of contractual monetary assets. These assets are initiallyrecognised at fair value and subsequent measurement is at amortised cost lessany allowance for impairment. Share-based payment Where share options are awarded to employees, the fair value of the options atthe date of grant is charged to the income statement over the vesting period.Non-market vesting conditions are taken into account by adjusting the number ofequity instruments expected to vest at each balance sheet date so that,ultimately, the cumulative amount recognised over the vesting period is based onthe number of options that eventually vest. Market vesting conditions arefactored into the fair value of the options granted. As long as all othervesting conditions are satisfied, a charge is made irrespective of whether themarket vesting conditions are satisfied. The cumulative expense is not adjustedfor failure to achieve a market vesting condition. Where the terms and conditions of options are modified before they vest, theincrease in the fair value of the options, measured immediately before and afterthe modification, is also charged to the income statement over the remainingvesting period. Where equity instruments are granted to persons other than employees, the incomestatement is charged with fair value of goods and services received. Property, plant and equipment Property, plant and equipment are held at cost being the purchase price andother costs directly attributable to bringing the asset into use, lessaccumulated depreciation and any impairment in value. Depreciation is provided on property, plant and equipment to write off the cost,less estimated residual values, evenly over their expected useful lives on astraight line basis. Lives used for this purpose are: • Fixtures, fittings and equipment - 3 years The asset's residual values, useful lives and methods of depreciation are reviewed, and adjusted if appropriate, at each financial year end. Interest bearing loans and borrowings All loans and borrowings are initially recognised at fair value net of anytransaction costs directly attributable to the issue of the loan or borrowing. After initial recognition, interest bearing loans and borrowings aresubsequently measured at amortised cost using the effective interest method,which ensures that any interest expense over the period to repayment is at aconstant rate on the balance of the liability carried in the balance sheet. Leases The determination of whether an arrangement is, or contains a lease is based onthe substance of the arrangement at inception date of whether the fulfilment ofthe arrangement is dependent on the use of a specific asset or assets or thearrangement conveys a right to use the asset. Finance leases, which transfer to the Group substantially all the risks andbenefits incidental to ownership of the leased item, are capitalised at theinception of the lease at the fair value of the leased property or, if lower, atthe present value of the minimum lease payments. Lease payments are apportionedbetween the finance charges and reduction of the lease liability so as toachieve a constant rate of interest on the remaining balance of the liability.Finance charges are reflected in profit or loss. Capitalised leased assets are depreciated over the shorter of the estimateduseful life of the asset and the lease term, if there is no reasonable certaintythat the Group will obtain ownership by the end of the lease term. Operating lease payments are recognised as an expense in profit or loss on astraight line basis over the lease term. Intangible assets Expenditure on pure and applied research is charged to the income statement inthe year in which it is incurred. Development costs are charged to the incomestatement in the year of expenditure, unless individual projects satisfy all ofthe following criteria: • the project is clearly defined and related expenditure is separately identifiable; • the project is technically feasible and commercially viable; • current and future costs are expected to be exceeded by future sales; and • adequate resources exist for the project to be completed. In such circumstances the costs are carried forward as an intangible non-currentasset and amortised over a period not exceeding 3 years commencing in the yearthe Group starts to benefit from the expenditure. Cash and cash equivalents Cash and cash equivalents include cash in hand, short term deposits with an originalmaturity of less than three months. Bank overdrafts are shown within borrowings in current liabilities on the balancesheet. Trade payables Trade payables are recognised initially at fair value and subsequently measuredat amortised cost. Foreign currency The consolidated financial statements are presented in pounds sterling ("£"),which is the Company's functional and presentation currency. Transactions inforeign currencies are translated at the exchange rate ruling at the date oftransaction. Foreign currency transactions are translated into the functionalcurrency using the exchange prevailing at the dates of the transactions. Foreignexchange gains and losses resulting from the settlement of such transactions andfrom the translation at year-end exchange rates of monetary assets andliabilities denominated in foreign currencies are recognized in the incomestatement. Taxation Tax on the profit or loss for the year comprises current and deferred tax. Taxis recognised in the income statement except to the extent that it relates toitems recognised directly in equity, in which case it is recognised in equity. Current tax is the expected tax payable on the taxable income for the year,using tax rates enacted or substantively enacted at the balance sheet datetogether with any adjustment to tax payable in respect of previous years. Deferred tax is provided on temporary differences between the carrying amountsof assets and liabilities for financial reporting purposes and the amounts usedfor taxation purposes. The following temporary differences are not provided for:the initial recognition of assets or liabilities that affect neither accountingnor taxable profit other than in a business combination, and differencesrelating to investments in subsidiaries to the extent that they will probablynot reverse in the foreseeable future. The amount of deferred tax provided isbased on the expected manner of realisation or settlement of the carrying amountof assets and liabilities, using tax rates enacted or substantively enacted atthe balance sheet date. 2. Loss per share Basic loss per share The calculation of the basic loss per share is based on the loss attributable toordinary shareholders of the parent divided by the weighted average number ofshares in issue during the period. For diluted loss per share, the weightedaverage number of ordinary shares in issue would be adjusted to reflect theimpact of conversion of dilutive potential ordinary shares. At 31 January 2008there were 27,461,359 warrants and 16,251,414 share options which could bepotentially dilutive in the future, but as they are currently anti-dilutive,they have been excluded from the following calculations. Adjusted (loss)/earnings per share The loss attributable to the equity holder of the parent has been increased bythe losses attributable to the shares owned by the minority interest that havebeen re-allocated to the parent in accordance with IAS27. An alternative EPS hasbeen calculated that shows the loss attributable to the parent's percentageinterest in the equity of the Group. 6 months to 6 months to Year to 31 January 31 January 31 July 2008 2007 2007 £'000s £'000s £'000sLoss for the periodattributable to the equity holders ofthe parent (421) (900) (167) Add back the minority's shareof losses in subsidiaries thathave been re-allocated to the 96 227 452equity holders of the parent _____ _____ _____Adjusted (loss)/earnings forthe period attributable to the (325) (673) 285equity holders of the parent _____ _____ _____Equity shares 207,813,013 121,838,768 124,444,247 _____ _____ _____Basic and fully diluted lossper share in pence (0.2) (0.7) (0.1) _____ _____ _____Adjusted basic and fully diluted (loss)/earnings per share in (0.2) (0.6) 0.2pence _____ _____ _____ 3. Adoption of IFRS In implementing the transition to IFRS, the Group has followed the requirementsof IFRS 1 "First Time Adoption of International Financial Reporting Standards",which in general requires IFRS accounting policies to be applied fullyretrospectively in deriving the opening balance sheet at the date of transition.In the Group's case this is 1 August 2006 being the start of the previous periodthat has been presented as comparative information. IFRS 1 contains certainmandatory exceptions and some optional exemptions to this principle ofretrospective application. In preparing these interim financial statements, theGroup has, in accordance with IFRS 1, applied the mandatory exceptions andcertain of the optional exemptions from full retrospective application of IFRS.In particular the Group has made the choice that, in accordance with IFRS 3,Business Combinations, prior to 1 August 2006, has not been restated. Goodwillarising on business combinations before 1 August 2006 (the date of transition toadopted IFRS) has been recorded at its carrying value under UK GAAP, being itscost there-under. The principal areas of impact are: •the use of proportionate consolidation which is considered the most appropriate method to report the activities of the Group rather than equity accounting - see column a) in note 4; •the reversal of amortisation of goodwill arising on acquisition of subsidiary companies which was previously amortised, as permitted by UK GAAP - see column b) in note 4; and •under IAS27 where losses applicable to a minority exceed that minority's interest in the subsidiary's equity, the excess must be allocated against the majority interest, rather than separately disclosed - now aggregated with the parent's interest in the group's earnings - see note 4 The impact of the first adjustment affects a variety of balances, but has noeffect on net assets. The impact of the second adjustment is to reduce reported losses and increasethe carrying value of goodwill. The final adjustment does not have any impact on net assets. 4. Unaudited comparative data restated in accordance with transition to IFRS a) Consolidated Balance Sheet at 1 August 2006 UK GAAP Adjustments IFRS a) b) Proportionate Amortisation of consolidation goodwill £'000s £'000s £'000s £'000sAssetsNon-current assetsProperty, plantand equipment 79 - - 79Goodwill 574 - - 574Other intangibleassets 197 - - 197 _____ _____ _____ _____ 850 - - 850 _____ _____ _____ _____Current assetsInventories 68 - - 68Trade and otherreceivables 221 - - 221Cash and cashequivalents 705 - - 705 _____ _____ _____ _____ 994 - - 994 ____ _____ _____ _____LiabilitiesCurrent liabilitiesTrade and otherpayables (338) - - (338)Obligationsunder financeleases (25) - - (25) _____ _____ _____ _____ (363) - - (363) _____ _____ _____ _____Non-currentliabilitiesBorrowings (232) - - (232)Obligationsunder financeleases (28) - - (28) _____ _____ _____ _____ (260) - - (260) _____ _____ _____ _____Net assets 1,221 - - 1,221 ===== ===== ===== ===== Capital and reserves attributable to equity holders of the company Share capital 606 - - 606Share premium 1,575 - - 1,575Merger reserve 757 - - 757Excess of minorities interest in losses over their equity interest in subsidiaries (340) - - (340)Accumulated losses (1,377) - - (1,377) _____ _____ _____ _____Total equity 1,221 - - 1,221 ===== ===== ===== ===== b) Consolidated Balance Sheet at 31 January 2007 UK GAAP Adjustments IFRS a) b) Proportionate Amortisation of consolidation goodwill £'000s £'000s £'000s £'000sAssetsNon-current assetsProperty, plantand equipment 126 15 - 141Goodwill 543 - 32 575Otherintangibleassets 137 - - 137Investment injoint venture 27 (27) - - _____ _____ _____ _____ 833 (12) 32 853 _____ _____ _____ _____Current assets Inventories 37 - - 37Trade and otherreceivables 342 - - 342Cash and cashequivalents 106 12 - 118 _____ _____ _____ _____ 485 12 - 497 _____ _____ _____ _____LiabilitiesCurrent liabilitiesTrade and otherpayables (468) - - (468)Obligationsunder financeleases (51) - - (51) _____ _____ _____ ____ (519) - - (519) _____ _____ _____ _____Non-currentliabilitiesBorrowings (232) - - (232)Obligationsunder financeleases (28) - - (28) _____ _____ _____ _____ (260) - - (260) _____ _____ _____ _____Net assets 539 - 32 571 ===== ===== ===== ===== Capital and reserves attributable to equity holders of the company Share capital 648 - - 648Share premium 1,783 - - 1,783Merger reserve 757 - - 757Excess of minorities interest in losses over their equity interest in subsidiaries (567) - - (567)Accumulated losses (2,082) - 32 (2,050) _____ _____ _____ _____Total equity 539 - 32 571 ===== ===== ===== ===== c) Consolidated Balance Sheet at 31 July 2007 UK GAAP Adjustments IFRS a) b) Proportionate Amortisation of consolidation goodwill £'000s £'000s £'000s £'000sAssetsNon-current assetsProperty, plantand equipment 39 58 - 97Goodwill - 585 10 595Otherintangibleassets 46 29 - 75Trade and otherreceivables 1,137 (569) - 568Investment injoint venture 1,701 (1,701) - - _____ _____ _____ _____ 2,923 (1,598) 10 1,335 _____ _____ _____ _____Current assetsInventories - 20 - 20Trade and otherreceivables 954 (198) - 756Cash and cashequivalents 2,494 1,798 - 4,292 _____ _____ _____ _____ 3,448 1,620 - 5,068 _____ _____ _____ _____LiabilitiesCurrent liabilitiesTrade and otherpayables (536) (185) - (721)Obligationsunder financeleases (18) - - (18) _____ _____ _____ _____ (554) (185) - (739) _____ _____ _____ _____Non-currentliabilitiesBorrowings (450) 163 - (287)Obligationsunder financeleases (9) - - (9) _____ _____ _____ _____ (459) 163 - (296) _____ _____ _____ _____Net assets 5,358 - 10 5,368 ==== ==== ==== ==== Capital and reserves attributable to equity holders of the company Share capital 1,013 - - 1,013Share premium 4,447 - - 4,447Merger reserve 1,319 - - 1,319Excess of minorities interest in losses over their equity interest in subsidiaries (406) - - (406)Accumulated losses (1,015) - 10 (1,005) _____ _____ _____ _____Total equity 5,358 - 10 5,368 ==== ==== ==== ==== d) Consolidated Income Statement for the six months ended 31 January 2007 UK GAAP Adjustments IFRS a) b) Proportionate Amortisation of consolidation goodwill £'000s £'000s £'000s £'000sRevenue 586 - - 586Cost of sales (189) - - (189) _____ _____ _____ _____Gross profit 397 - - 397Administrativeexpenses (1,309) (23) 32 (1,300) _____ _____ _____ _____ Operating loss (912) (23) 32 (903)Share ofoperating lossin jointventure (23) 23 - - _____ _____ _____ _____Loss onordinaryactivitiesbefore interest (935) - 32 (903)Finance income 3 - - 3 _____ _____ _____ _____ Loss for theperiod (932) - 32 (900) ==== ==== ==== ==== Attributableto:- Lossesapplicable tothe parent'sinterest in thegroup (705) - 32 (673)- Losses in thesubsidiariesapplicable tothe minorityinterests inexcess of theminorities'interests inthe equity ofthosesubsidiaries (227) - - (227) _____ _____ _____ _____ Lossesattributable tothe equityholders of theparent (932) - 32 (900) ==== ==== ==== ==== e) Consolidated Income Statement for the year to 31 July 2007 UK GAAP Adjustments IFRS a) b) Proportionate Amortisation of consolidation goodwill £'000s £'000s £'000s £'000sRevenue 1,324 - - 1,324Less: Share ofjoint venture (13) 13 - - _____ _____ _____ _____ 1,311 13 - 1,324Cost of sales (410) (3) - (413) _____ _____ _____ _____Gross profit 901 10 - 911Other income:Gain ondisposal ofsubsidiaries tojoint venture - 1,951 (9) 1,942Administrativeexpenses (3,053) (23) 19 (3,057) _____ _____ _____ _____Operating loss (2,152) 1,938 10 (204)Share ofoperating lossin jointventure (13) 13 - - _____ _____ _____ _____Loss onordinaryactivitiesbefore interest (2,165) 1,951 10 (204) _____ _____ _____ _____Finance income 12 - - 12Finance expense (9) - - (9) _____ _____ _____ _____Loss before tax (2,162) 1,951 10 (201)Income taxcredit 34 - - 34 _____ _____ _____ _____Loss for theperiod (2,128) 1,951 10 (167) ==== ==== ==== ====Attributableto:- Lossesapplicable tothe parent'sinterest in thegroup (1,676) 1,951 10 285- Losses in thesubsidiariesapplicable tothe minorityinterests inexcess of theminorities'interests inthe equity ofthesubsidiaries (452) - - (452) _____ _____ _____ _____Lossesattributable tothe equityholders of theparent (2,128) 1,951 10 (167) ==== ==== ==== ==== f) Consolidated Cash Flow Statement for the six months ended 31January 2007 UK GAAP Adjustments IFRS a) b) Proportionate Amortisation of consolidation goodwill £'000s £'000s £'000s £'000sCash flow from operatingactivitiesLoss beforetaxation (932) - 32 (900)Adjustments for:- Depreciation and amortisation 85 - - 85- Amortisation of goodwill 32 - (32) -- Joint venture loss 23 (23) - -- Finance income (3) - - (3) Decrease ininventories 30 - - 30(Increase) intrade and otherreceivables (120) - - (120)Increase/(decrease) in tradeand otherpayables 128 (1) - 127 _____ _____ _____ _____Net cash usedin operations (757) (24) - (781) _____ _____ _____ _____Cash flow from investingactivitiesPurchase ofproperty plantand equipment (32) (15) - (47)Acquisition ofinterest injoint venture (50) 50 - -Finance income 3 - - 3 _____ _____ _____ _____Net cash usedin investingactivities (79) 35 - (44) _____ _____ _____ _____Cash flows from financingactivitiesIssue ofordinary sharesfor cash 250 - - 250Capitalrepayments offinance leaseobligations (13) 1 - (12) _____ _____ _____ _____Net cashgenerated fromfinancingactivities 237 1 - 238 _____ _____ _____ _____ Net decrease incash and cashequivalents (599) 12 - (587)Cash and cashequivalents atbeginning ofperiod 705 - - 705 _____ _____ _____ _____Cash and cashequivalents atend of period 106 12 - 118 ==== ==== ==== ==== g) Consolidated Cash Flow Statement for the year ended 31 July 2007 UK GAAP Adjustments IFRS a) b) Proportionate Amortisation of consolidation goodwill £'000s £'000s £'000s £'000sCash flow from operatingactivitiesLoss beforetaxation (2,162) 1,951 10 (201)Adjustments for:- Depreciationand amortisation 175 - - 175- Amortisationand impairmentof goodwill 415 - (19) 396- Share-basedpayments 87 - - 87- Finance income (12) - - (12)- Finance expenses 9 - - 9- Joint venture loss 13 (13) - -- Goodwill disposal - 595 - 595- Gain on disposal ofsubsidiaries - (1,951) 9 (1,942)Decrease ininventories 27 21 - 48(Increase) intrade and otherreceivables (321) (463) - (784)Increase/(decreasein trade and otherpayables 384 (21) - 363Corporation taxcredit 34 - - 34 _____ _____ _____ _____Net cash used in operations (1,351) 119 - (1,232) _____ _____ _____ _____Cash flow from investing activitiesPurchase ofproperty plantand equipment (91) (19) - (110)Developmentcosts (28) - - (28)Disposal ofcash insubsidiaries tojoint venture 137 (137) - -Finance income 12 - - 12 _____ _____ _____ _____Net cash usedin investingactivities 30 (156) - (126) _____ _____ _____ _____Cash flows from financing activitiesIssue ofordinary sharesfor cash 3,216 - - 3,216 Cash acquiredthrough jointventure issuingshares for cash - 1,835 - 1,835 Loan proceeds 125 - - 125 Loan repayments (200) - - (200) Capitalrepayments offinance leaseobligations (26) - - (26) Financeexpenses (5) - - (5) _____ _____ _____ _____Net cashgenerated fromfinancingactivities 3,110 1,835 - 4,945 _____ _____ _____ _____Net increase incash and cashequivalents 1,789 1,798 - 3,587Cash and cashequivalents atbeginning ofperiod 705 - - 705 _____ _____ _____ _____Cash and cashequivalents atend of period 2,494 1,798 - 4,292 ==== ==== ==== ==== This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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