Half-yearly Report
November 27 2009 - 1:00AM
UK Regulatory
TIDMSGG
27 November 2009
Sterling Green Group Plc
("Sterling Green" or "the Company")
Half-yearly results for the six month period
ended 30 September 2009
Highlights
* Revenue from debt management services increased by 54 per cent. to GBP
1,052,000
* Operating profit of GBP55,000 from debt management services
* Operating profit of GBP14,000 from the mortgage division despite 65 per cent.
fall in revenues.
* Significant increase in active client numbers to 3,120
Enquiries:
Sterling Green Group plc Tel: 0161 975 5757
Michael Edelson
Merchant John East Securities Limited Tel: 020 7628 2200
Simon Clements/David Worlidge
Chairman's Statement
Introduction
I am pleased to present the Group's half-yearly results for the six month
period ended 30 September 2009.
Results and dividends
The Group generated a loss before and after taxation for the six month period
of GBP41,000 (six months ended 30 September 2008 - GBP365,000 loss) on revenues of
GBP1,139,000 (six months ended 30 September 2008 - GBP931,000).
The Directors do not recommend the payment of a dividend.
Trading review
The Group started the current financial year as a much more streamlined
business. Revenues from debt management services for the six month period ended
30 September 2009 were GBP1,052,000 compared to GBP681,000 for the six month period
ended 30 September 2008, representing a 54 per cent. increase. The increased
revenues generated an operating profit for debt management services of GBP55,000
compared to an operating loss of GBP242,000 for the six month period ended 30
September 2008. The Directors are encouraged by the improvement in the
financial performance of the debt management division during the period.
In contrast, the results from the mortgage division were disappointing.
Re-mortgage commission revenues in the period were GBP87,000 compared to GBP250,000
for the six month period ended 30 September 2008. Despite the reduction in
revenue, the mortgage division did generate an operating profit of GBP14,000
reflecting an improvement compared to the GBP25,000 operating loss for the six
month period ended 30 September 2008. This improvement in operating result
reflected a significant reduction in the staff costs and other operational
overheads of the division.
The level of unallocated central Group costs in the period remained consistent
with the prior period.
The Group had 3,120 active debt management clients as at 30 September 2009,
representing an increase of 577 in the period.
Going concern
There have been no significant changes in the going concern status of the Group
since the release of the audited financial statements for the year ended 31
March 2009. Accordingly, the Board has prepared this half-yearly financial
report on the going concern basis.
Outlook
The Board is pleased with the increase in the number of debt management clients
and associated growth in revenues in the period and are confident that the
business will continue to grow in the second half of the year, albeit at a
slower rate. In order to sustain the Group's growth momentum, the Board
continues to review opportunities which have the potential to provide
additional revenue streams. In particular, the Board is seeking potential
introducers of new business. Furthermore, the Board continue to seek out
potential acquisition targets in the area of small debt management business and
debt management portfolios.
Michael Edelson
Chairman
26 November 2009
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTH PERIOD ENDED 30 SEPTEMBER 2009
Six months e Six months Year
nded 30 ended 30
September September ended
2009 2008 31March
2009
GBP000 GBP000 GBP000
Revenue 1,139 931 1,966
Cost of sales (557) (616) (1,069)
Gross profit 582 315 897
Administrative expenses (600) (667) (1,218)
Results from operating activities (18) (352) (321)
Finance income - 4 5
Finance costs (23) (17) (49)
Net finance costs (23) (13) (44)
Loss on ordinary activities before (41) (365) (365)
taxation
Income tax credit - - 18
Loss on ordinary activities after (41) (365) (347)
taxation
attributable to equity holders of the
parent
Loss per share - basic and diluted (0.01p) (0.13p) (0.12p)
All amounts relate to continuing operations.
All comprehensive income is attributable to the equity holders of the parent.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN TOTAL EQUITY
FOR THE SIX MONTH PERIOD ENDED 30 SEPTEMBER 2009
Six months Six months Year
ended 30 ended 30
September 200 September ended 31
9 2008 March
2009
GBP000 GBP000 GBP000
Balance at the beginning of the period 925 972 972
Total comprehensive income for the
period
Loss for the period (41) (365) (347)
Transactions with owners
Issue of share capital 100 200 200
Share capital to be issued (100) - 100
Total transactions with owners - 200 300
Balance at the end of the period 884 807 925
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 SEPTEMBER 2009
As at 30 As at As at
September 200
9 30 September 31 March
2008
2009
GBP000 GBP000 GBP000
Non-current assets
Goodwill 1,115 1,115 1,115
Property, plant and equipment 161 258 209
Total non-current assets 1,276 1,373 1,324
Current assets
Trade and other receivables 235 89 142
Cash and cash equivalents 97 102 182
Total current assets 332 191 324
Total assets 1,608 1,564 1,648
Current liabilities
Trade and other payables (364) (342) (319)
Current tax liabilities - (18) -
Borrowings (86) (86) (86)
Total current liabilities (450) (446) (405)
Net current liabilities (118) (255) (81)
Non-current liabilities
Loans and borrowings (274) (311) (318)
Total non-current liabilities (274) (311) (318)
Total liabilities (724) (757) (723)
Net assets 884 807 925
Equity
Share capital 304 288 288
Share premium account 1,794 1,710 1,710
Share capital to be issued - - 100
Capital reserve 6 6 6
Other reserves 891 891 891
Retained losses (2,111) (2,088) (2,070)
Total equity 884 807 925
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW
FOR THE SIX MONTH PERIOD ENDED 30 SEPTEMBER 2009
Six months Six months Year
ended 30 ended 30 ended 31
September September March
2009 2008 2009
GBP000 GBP000 GBP000
Cash flows used in operating
activities
Loss before tax (41) (365) (365)
Adjustments for:
Depreciation of property, plant and 49 52 101
equipment
Finance income - (4) (5)
Finance costs 23 17 49
Operating cash flows before movement 31 (300) (220)
in working capital
(Increase)/ Decrease in trade and (93) 52 (1)
other receivables
Increase in trade and other payables 45 24 1
Net cash used in operating activities (17) (224) (220)
Cash flow (used in)/generated from
investing activities
Purchase of property, plant and (1) (1) (1)
equipment
Finance income - 4 5
Net cash (used in)/generated from inve (1) 3 4
sting activities
Cash flow (used in)/generated from
financing activities
Capital element of finance lease (44) (42) (85)
payments
Issue of ordinary share capital, net - 200 200
of costs
Proceeds from new loans - 200 250
Proceeds in advance of issue of share - - 100
capital
Finance costs (23) (17) (49)
Net cash (used in)/generated from (67) 341 416
financing activities
Net (decrease)/increase in cash and (85) 120 200
cash equivalents
Cash and cash equivalents at beginning 182 (18) (18)
of period
Cash and cash equivalents at end of 97 102 182
period
NOTES TO THE HALF-YEARLY REPORT
FOR THE SIX MONTH PERIOD ENDED 30 SEPTEMBER 2009
1. Reporting entity
Sterling Green Group plc (the "Company") is a company registered in England and
Wales. The condensed consolidated interim financial statements of the Company
for the six month period ended 30 September 2009 comprise the Company and its
subsidiaries (together the "Group").
The consolidated financial statements of the Group for the year ended 31 March
2009 are available upon request from the Company's registered office by writing
to the Company Secretary, Sterling Green Group plc, Number 14, The Embankment,
Vale Road, Heaton Mersey, Stockport SK4 3GN or can be obtained from the
Company's website which is www.sterlinggreen.co.uk.
2. Statement of compliance
This interim financial report has been prepared on the basis of the recognition
and measurement requirements of IFRS anticipated to be in issue as either
endorsed by the EU and effective (or available for early adoption) at 31 March
2010.
This interim financial report should be read in conjunction with the Report and
Accounts for the year ended 31 March 2009, which were approved for issue by the
Board of Directors on 29 September 2009, as it provides an update of previously
reported information.
The comparative figures for the year ended 31 March 2009 were derived from the
statutory accounts for that year which have been delivered to the Registrar of
Companies. Those accounts received an unqualified audit report which did not
contain statements under sections 498 (2) or (3) of the Companies Act 2006.
These condensed consolidated interim financial statements were approved by the
Board on 26 November 2009. The financial information contained therein for the
six month period ended 30 September 2009 and similarly the six month period
ended 30 September 2008 has neither been audited nor reviewed.
3. Operating segments
The Group's business segments are its debt management division, its
re-mortgaging operations and its head office operations. This is the basis on
which the Group reports its primary segmental information. In the table below,
all revenues are generated by sales to external parties.
Debt Re- Unallocated Total
Manage- mortgages Group items
ment
GBP000 GBP000 GBP000 GBP000
Performance by activity:
Revenue:
- six months ended 30 Sept 1,052 87 - 1,139
2009
- six months ended 30 Sept 681 250 - 931
2008
- year ended 31 March 2009 1,609 357 - 1,966
Operating profit/(loss):
- six months ended 30 Sept 55 14 (87) (18)
2009
- six months ended 30 Sept (242) (25) (85) (352)
2008
- year ended 31 March 2009 (168) 15 (168) (321)
Total assets:
- 30 September 2009 1,563 25 20 1,608
- 30 September 2008 1,448 16 100 1,564
- 31 March 2009 1,524 22 102 1,648
The Group operates in a sector where no significant seasonal or cyclical
variations in revenues and operating results are experienced during the
financial year.
4. Loss per share
The calculation of basic loss per share is based on the following:
Six months Six months Year ended
ended 30 ended 30 31
September September March
2009 2008 2009
Loss for the period (GBP000) (41) (365) (347)
Weighted average number of 303,500,527 287,844,242 287,569,637
shares
Loss per share (pence) (0.01) (0.13) (0.12)
Diluted loss per share is calculated by adjusting the weighted average number
of ordinary shares in issue assuming conversion of all dilutive potential
ordinary shares. The Company's potential ordinary shares consist of share
options, warrants and deferred consideration. Due to losses in the current and
preceding periods there are no dilutive ordinary shares.
5. Dividends
No dividend is proposed for the six month period ended 30 September 2009. No
dividend was paid in or proposed for the year ended 31 March 2009.
END
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