Interim Results

Verdes Management PLC ("Verdes" or the "Company")

Interim Statement for the period ended 31st March 2011

CHAIRMAN'S STATEMENT

I present the financial statements for the six months to 31st March 2011.

Verdes has continued to build on the foundations established at the time of the Company's strategic change in business direction, and as we highlighted at the time of the preliminary results for the year to 30th September 2010, the Company has undertaken a selective recruitment drive to ensure it is fully equipped to take advantage of market opportunities. At the Board level, Richard Phillips has been appointed a non-executive director. He brings a great deal of relevant and successful experience in rescue and turnaround situations and has already made a significant positive impact on Verdes' turnaround offering.

We have also made further hires at management level to enable Verdes to strengthen its research and business practices. Set alongside the Advisory Panel that was established earlier this year and the turnaround team more recently assembled, I believe we now have a team in place that can drive Verdes forward.

The Company has been marketing its services to numerous intermediaries and following several potential transaction opportunities, including as announced on 30th March, working alongside a number of independent shareholders in AssetCo plc, the AIM listed fire and rescue business. Progress was made in discussions with various stakeholders regarding the future of AssetCo plc, but as the project developed, it became clear that the situation was no longer compatible with Verdes' stated strategy of creating value for its shareholders and so the relationship was terminated. It was disappointing not to progress further with this opportunity. However, the Company has generated a significant number of new leads, working contacts with UK institutions and opportunities as a result of the work with AssetCo plc. We expect to be able to provide further updates on these in the future.

During the period, we maintained our focus on efficient management of working capital. Administrative expenses for the 6 months ended 31st March 2011 were £285,311 (2010: £33,546) which is a result of the increase in headcount and resources. During the period we raised £1,237,001 net from the issue of equity shares. At 31st March 2011 we had cash resources of £996,665 and no debt. The loss attributable to shareholders for the period was £285,295.

The Company remains active in terms of pursuing and working on situations in the turnaround sector. The Board is aware that the lack of news flow can at times be frustrating but we continue to work to generate value for shareholders and I would like to pass on the Board's thanks for their support over the past six months. We believe that the business model is sound. The Group has a robust balance sheet and sufficient working capital to execute our business plan.  

John Matthews

Chairman

13th June 2010

Enquiries

Verdes Management plc

Consolidated Income Statement for six months ended 31st March 2011

Verdes Management plc

Consolidated Balance Sheet as at 31st March 2011

Verdes Management plc

Consolidated Statement of Changes in Equity as at 31st March 2011

Verdes Management plc

Consolidated Cash Flow Statement for six months ended 31st March 2011

Notes to the unaudited financial statements

1. Basis of prepapration

The financial information included in this report does not constitute statutory accounts as defined in section 435 of the Companies Act 2006. The consolidated interim financial statements for the six months ended 31 March 2011 have been prepared under applicable International Financial Reporting Standards adopted by the European Union ("IFRS").

The financial information for the period ended 30 September 2010 has been extracted from the statutory accounts for that period. The auditors' report on the full statutory accounts for the period ended 30 September 2010 was unqualified and did not contain a statement under section 498(2) or 498(3) of the Companies Act 2006. The financial information for the six months ended 31 March 2010 and 31 March 2011 has not been audited.

2. Principal Accounting Policies

The principal accounting policies adopted are consistent with those of the annual financial statements for the year ended 30 September 2010 and are those expected to be applied for the year ended 30 September 2011. 

3. Discontinued operations

On 28 September 2010, the company discontinued its music business and operations by way of a disposal of its subsidiary companies X-Phonics Music Limited, X-Phonics Music Publishing Limited, X-Phonics Productions Limited and White Noise Music Limited.

The combined results of the discontinued operations (the music business) included in the income statement are set out below.

4. Exceptional administrative expenses

During the previous year, as part of the group re-structuring, the Directors M D Hosie and R F Davies agreed to waive previous amounts owed to them by the company (for Director services) of £40,333 and £36,000 respectively.

5. Earnings per Share

The earnings per ordinary share have been calculated on the ordinary activities after taxation of -£285,295 (31 March 2010: -£16,286, 30 September 2010: £154,234) using the weighted average number of ordinary shares in issue during the period being 186,512,742 (31 March 2010: 66,214,920, 30 September 2010: 66,674,107). The weighted average number of diluted ordinary shares in issue during the period was 186,512,742 (31 March 2010: 66,214,920, 30 September 2010: 66,674,107).