TIDMWTC
RNS Number : 1524Z
Westcity PLC
16 September 2009
?
Company Number 0164213
WESTCITY PLC
HALF YEAR REPORT 2009
unaudited HALF YEAR results foR the six months to
30 June 2009
WESTCITY PLC
CHAIRMAN'S STATEMENT
UNAUDITED RESULTS FOR THE HALF YEAR ENDED 30 June 2009
Westcity Plc's ("Group") major asset is its investment of 34.3% in the Stonehage
Westcity Property Fund("Fund") of GBP14,355,000 which is carried at fair value
based upon the proportionate share of the net asset value of the Fund of
EUR49.2m.
The Group incurred a loss after tax for the six months under review of
GBP2,970,000 (2008: loss GBP4,843,000) principally due to the loss on the
proportionate share of the Group's investment in the Fund of GBP2,271,000 (2008:
loss GBP2,297,000). This loss comprises two components, a reduction in the net
asset value of the Fund for the six months of GBP168,000, and, the impact of
foreign currency translation loss of GBP2,103,000 as a result of the
strengthening of the pound since 31 December 2008 from 1.02 to 1.17 to the Euro.
Excluding the Fund related losses, the Company recorded an operating loss of
GBP699,000 (2008: loss GBP2,546,000 including loss on forward exchange contract
of GBP1,441,000),as revenues failed to cover the Company's operating expenses
due to the reduced level of investment activity by the Fund.
REVIEW OF OPERATIONS
We have continued to adopt a defensive strategy through this turbulent period, a
strategy which comprises three key elements:
* no further investment until value is clearly understood and funding markets
return to sensible levels
* continue to maintain and improve current levels of income on all our assets
* monitor all levels on debt finance with a view of maintaining or renegotiating
principal terms where applicable
The Fund continued to liquidate investments where opportunities presented
themselves with a view to preserving cash, as a result of which 90% of the total
net asset value of the Fund was represented in cash (EUR44.3 million) as at 30
June 2009.
As a consequence of the asset divestments and freeze on new investments by the
Fund, minimal revenue has been generated for our Group from fee income. Against
this lack of income the group continued to further reduce its fixed cost base.
The assets in the Fund are being constantly monitored and closely managed to
ensure that wherever possible improved rental income and reduced cost bases are
achieved.
The majority of the Fund's remaining investment portfolio is situated in
Germany, where
transactional activity remained extremely low during the first six months of
2009. Vacancy rates and rental rates remained under pressure and capitalisation
yields continued to expand with the consequential reduction in property values.
Although the portfolio was not formally valued at 30 June 2009, further
impairment provisions totalling EUR3.4 million were made against three of the
Fund's German investments. These impairments were made with the benefit of
indicative values and guidance received from professional advisors in Germany.
However, the overall net asset value of the Fund only reduced by EUR0.5 million
during the 6 months to 30th June 2009.
OUTLOOK
Whilst the company has reduced its fixed cost base over the past twelve months
there is no visibility on revenues recovering. Active management of the
remaining portfolio remains a priority with strong emphasis on further reducing
the cost base and improving rental income at the property level. Tenant
retention remains a key focus.
While yields continue to come under pressure and transactional activity remains
low, maximising and realising the value from the existing portfolio will require
time. Once some level of confidence returns to world markets and financing flows
are restored to more normal levels, the longer term is expected to provide
stronger exit opportunities for these investments. In the meantime the Fund will
continue to manage these assets with a focus on preserving value.
PRINCIPAL RISKS AND UNCERTAINTIES
There have been no changes to the risk factors in the Group since the year end.
Interest rate risk - Our interest rate risk primarily arises from borrowings
issued at floating interest rates which exposes the group to cashflow interest
rate risk. The group is exposed to interest rate risk as a result of its loan
from Chapman International Investment LTD. At 30 June 2009 the group had debt of
GBP1,175,000.
Credit risk - The group's principal financial assets are cash balances and
deposits. To reduce the risk of counterparty default the group deposits its
surplus funds in approved high quality banks. Credit risk is limited due to the
group's close working relationship with the Fund.
Foreign currency risk - The group is exposed to foreign currency risk as a
result of its investment into the Stonehage Westcity Property Fund.
Market risk - The year under review has been one of unparalleled turbulence with
severe volatilities within the real estate and financial markets which has led
to a re-evaluation of property as an asset class. The past twelve months have
proved to be a particularly testing time with most property companies and funds
experiencing a sharp fall in capital values.
Liquidity risk - The Group's approach to managing liquidity is to ensure, as far
as possible, that it will always have sufficient liquidity to meet its
liabilities when due, under both normal and stressed conditions, without
incurring unacceptable losses or risking damage to the Group's reputation. The
financial obligation in the Group is principally restricted to trade and other
payables and the loan from Chapman International Investment LTD.
A detailed explanation of the principal risks and uncertainties can be found in
the 2008 Annual Report (Pages 35-38 / Note 14) which is available in "read only"
format for viewing or downloading, free of charge, on the company website at
www.westcityplc.com/reports.php.
DIVIDEND
No dividend will be paid on the ordinary shares in respect of the period under
review (2008: NIL).
RECOMMENDED CASH OFFER AND SHARE ALTERNATIVE (the "Offer")
Westcity has separately announced today that the Board has reached agreement on
the terms of a recommended cash offer and share alternative to be made from a
newly formed company Berkshire Bidco Limited incorporated by Westcity's largest
shareholder, Chapman International Investments Ltd.
Shareholders are entitled to receive 13 pence in cash for each Westcity share or
elect to receive, in respect of all (but not some) of their Westcity shares, 1
Berkshire share for each Westcity share in lieu of the cash consideration. The
cash offer represents a premium of approximately 48.5% to the price of 8.75
pence per Westcity share (being closing price on 29th June 2009, the last
trading day before the announcement on 24th August 2009 by Westcity that it was
in discussions regarding a possible offer).
The Offer is to be implemented by means of a scheme of arrangement between
Westcity and the Scheme Shareholders under part 26 of the 2006 Act.
Ira Rapp
Executive Chairman
16 September 2009
WESTCITY PLC
RESPONSIBILITY STATEMENT
UNAUDITED RESULTS FOR THE HALF YEAR ENDED 30 June 2009
We confirm that to the best of our knowledge:
(a)The condensed set of financial statements has been prepared in accordance
with
IAS 34 'Interim Financial Reporting';
(b)the chairman's statement includes a fair review of the information required
by DTR 4.2.7R
(indication of important events during the first six
months and description of principal risks
and uncertainties for the
remaining six months of the year); and
(c)the chairman's statement includes a fair review of the information required
by DTR 4.2.8R
(disclosure of related party transactions and changes
therein).
On behalf of the Board
+--------------------------------------+--------------------------------------+
| Ira Rapp | Michael Tannenbaum |
| Executive Chairman | Finance Director |
| 16 September 2009 | 16 September 2009 |
+--------------------------------------+--------------------------------------+
WESTCITY PLC
CONDENSED CONSOLIDATED INCOME STATEMENT
UNAUDITED RESULTS FOR THE HALF YEAR ENDED 30 June 2009
+---------------------------------+--+-------------+--------------+--------------+
| | | Unaudited | Unaudited | Audited |
| | | results for | results for | results for |
| | | the | the | the year |
| | | 6 months to | 6 months to | ended |
| | | 30 June | 30 June | 31 December |
| | | 2009 | 2008 | 2008 |
+---------------------------------+--+-------------+--------------+--------------+
| | | GBP'000 | GBP'000 | GBP'000 |
+---------------------------------+--+-------------+--------------+--------------+
| | | | | |
+---------------------------------+--+-------------+--------------+--------------+
| REVENUE | | 106 | 432 | 694 |
+---------------------------------+--+-------------+--------------+--------------+
| | | | | |
+---------------------------------+--+-------------+--------------+--------------+
| Finance revenue | | - | 90 | 91 |
+---------------------------------+--+-------------+--------------+--------------+
| Employee benefits expense | | (496) | (1,250) | (2,013) |
+---------------------------------+--+-------------+--------------+--------------+
| Depreciation and amortisation | | (13) | (19) | (36) |
| expense | | | | |
+---------------------------------+--+-------------+--------------+--------------+
| Other expenses | | (404) | (407) | (1,144) |
+---------------------------------+--+-------------+--------------+--------------+
| Loss on Investment held at fair | | (2,271) | (2,297) | (4,512) |
| value through profit and loss | | | | |
+---------------------------------+--+-------------+--------------+--------------+
| Finance Costs | | - | - | (27) |
+---------------------------------+--+-------------+--------------+--------------+
| Share of profits of equity | | 108 | 49 | 218 |
| accounted investments | | | | |
+---------------------------------+--+-------------+--------------+--------------+
| Loss on forward exchange | | - | (1,441) | (1,441) |
| contract | | | | |
+---------------------------------+--+-------------+--------------+--------------+
| | | | | |
+---------------------------------+--+-------------+--------------+--------------+
| (LOSS) BEFORE TAX | | (2,970) | (4,843) | (8,170) |
+---------------------------------+--+-------------+--------------+--------------+
| | | | | |
+---------------------------------+--+-------------+--------------+--------------+
| Income taxes | | - | - | - |
+---------------------------------+--+-------------+--------------+--------------+
| | | | | |
+---------------------------------+--+-------------+--------------+--------------+
| (LOSS) FOR THE PERIOD | | (2,970) | (4,843) | (8,170) |
| ATTRIBUTABLE TO EQUITY HOLDERS | | | | |
| OF THE PARENT | | | | |
+---------------------------------+--+-------------+--------------+--------------+
| | | | | |
+---------------------------------+--+-------------+--------------+--------------+
| | | | | |
+---------------------------------+--+-------------+--------------+--------------+
| | | | | |
+---------------------------------+--+-------------+--------------+--------------+
| | | | | |
+---------------------------------+--+-------------+--------------+--------------+
| | | | | |
+---------------------------------+--+-------------+--------------+--------------+
| | | | | |
+---------------------------------+--+-------------+--------------+--------------+
| Basic (loss) per share | | (4.00)p | (6.50)p | (11.00)p |
+---------------------------------+--+-------------+--------------+--------------+
| Diluted (loss) per share | | (4.00)p | (6.50)p | (11.00)p |
+---------------------------------+--+-------------+--------------+--------------+
| | | | | |
+---------------------------------+--+-------------+--------------+--------------+
WESTCITY PLC
CONDENSED CONSOLIDATED Balance Sheet
AS AT 30 June 2009
+---------------------------------------+-------+-----------+-----------+-----------+
| | | Unaudited | Unaudited | Audited |
| | | | | |
+---------------------------------------+-------+-----------+-----------+-----------+
| | | 30 June | 30 June | 31 |
| | | 2009 | 2008 | December |
| | | | | 2008 |
+---------------------------------------+-------+-----------+-----------+-----------+
| |Notes | GBP'000 | GBP'000 | GBP'000 |
+---------------------------------------+-------+-----------+-----------+-----------+
| | | | | |
+---------------------------------------+-------+-----------+-----------+-----------+
| NON-CURRENT ASSETS | | | | |
+---------------------------------------+-------+-----------+-----------+-----------+
| Property, plant and | | 20 | 50 | 34 |
| equipment | | | | |
+---------------------------------------+-------+-----------+-----------+-----------+
| Equity accounted investments | | 299 | 171 | 191 |
+---------------------------------------+-------+-----------+-----------+-----------+
| Other financial assets | | 14,355 | 18,840 | 16,626 |
+---------------------------------------+-------+-----------+-----------+-----------+
| | | 14,674 | 19,061 | 16,851 |
+---------------------------------------+-------+-----------+-----------+-----------+
| | | | | |
+---------------------------------------+-------+-----------+-----------+-----------+
| CURRENT ASSETS | | | | |
+---------------------------------------+-------+-----------+-----------+-----------+
| Trade and other receivables | | 68 | 526 | 342 |
+---------------------------------------+-------+-----------+-----------+-----------+
| Prepayments | | 41 | 58 | 22 |
+---------------------------------------+-------+-----------+-----------+-----------+
| Cash and cash equivalents | | 51 | 512 | 42 |
+---------------------------------------+-------+-----------+-----------+-----------+
| | | 160 | 1,096 | 406 |
+---------------------------------------+-------+-----------+-----------+-----------+
| | | | | |
+---------------------------------------+-------+-----------+-----------+-----------+
| TOTAL ASSETS | | 14,834 | 20,157 | 17,257 |
+---------------------------------------+-------+-----------+-----------+-----------+
| | | | | |
+---------------------------------------+-------+-----------+-----------+-----------+
| CURRENT LIABILITIES | | | | |
+---------------------------------------+-------+-----------+-----------+-----------+
| Trade and other payables | | 182 | 350 | 255 |
+---------------------------------------+-------+-----------+-----------+-----------+
| Loans and borrowings | | 1,175 | - | - |
+---------------------------------------+-------+-----------+-----------+-----------+
| Provisions | 6 | 131 | 55 | 323 |
+---------------------------------------+-------+-----------+-----------+-----------+
| | | 1,488 | 405 | 578 |
+---------------------------------------+-------+-----------+-----------+-----------+
| | | | | |
+---------------------------------------+-------+-----------+-----------+-----------+
| NON-CURRENT LIABILITIES | | | | |
+---------------------------------------+-------+-----------+-----------+-----------+
| Loans and borrowings | | - | - | 400 |
+---------------------------------------+-------+-----------+-----------+-----------+
| Provisions | 6 | 164 | 374 | 167 |
+---------------------------------------+-------+-----------+-----------+-----------+
| | | 164 | 374 | 567 |
+---------------------------------------+-------+-----------+-----------+-----------+
| | | | | |
+---------------------------------------+-------+-----------+-----------+-----------+
| TOTAL LIABILITIES | | 1,652 | 779 | 1,145 |
+---------------------------------------+-------+-----------+-----------+-----------+
| | | | | |
+---------------------------------------+-------+-----------+-----------+-----------+
| NET ASSETS | | 13,182 | 19,378 | 16,112 |
+---------------------------------------+-------+-----------+-----------+-----------+
| | | | | |
+---------------------------------------+-------+-----------+-----------+-----------+
| SHAREHOLDERS' EQUITY | | | | |
+---------------------------------------+-------+-----------+-----------+-----------+
| Called up share capital | 7 | 743 | 743 | 743 |
+---------------------------------------+-------+-----------+-----------+-----------+
| Share based payments reserve | 8 | 491 | 390 | 451 |
+---------------------------------------+-------+-----------+-----------+-----------+
| Other capital reserves | 8 | 25,571 | 25,589 | 25,571 |
+---------------------------------------+-------+-----------+-----------+-----------+
| Retained earnings | 8 | (13,623) | (7,344) | (10,653) |
+---------------------------------------+-------+-----------+-----------+-----------+
| | | 13,182 | 19,378 | 16,112 |
+---------------------------------------+-------+-----------+-----------+-----------+
WESTCITY PLC
condensed CONSOLIDATED Cash Flow Statement
FOR THE half YEAR ENDED 30 June 2009
+------------------------------------+-------+------------+------------+------------+
| | | Unaudited | Unaudited | Audited |
| | | 6 months | 6 months | year to |
| | | to | to | 31 |
| | | 30 June | 30 June | December |
| | | 2009 | 2008 | 2008 |
+------------------------------------+-------+------------+------------+------------+
| |Notes | GBP'000 | GBP'000 | GBP'000 |
+------------------------------------+-------+------------+------------+------------+
| | | | | |
+------------------------------------+-------+------------+------------+------------+
| Net cash flows from | 9 | 9 | (4,365) | (4,809) |
| operating activities | | | | |
+------------------------------------+-------+------------+------------+------------+
| | | | | |
+------------------------------------+-------+------------+------------+------------+
| | | | | |
+------------------------------------+-------+------------+------------+------------+
| Investing activities | | | | |
+------------------------------------+-------+------------+------------+------------+
| Interest received | | - | 90 | 91 |
+------------------------------------+-------+------------+------------+------------+
| Net cash flows used in | | - | 90 | 91 |
| investing activities | | | | |
+------------------------------------+-------+------------+------------+------------+
| | | | | |
+------------------------------------+-------+------------+------------+------------+
| | | | | |
+------------------------------------+-------+------------+------------+------------+
| Financing activities | | | | |
+------------------------------------+-------+------------+------------+------------+
| Interest paid | | - | - | (27) |
+------------------------------------+-------+------------+------------+------------+
| Net cash flows used in | | - | - | (27) |
| financing activities | | | | |
+------------------------------------+-------+------------+------------+------------+
| | | | | |
+------------------------------------+-------+------------+------------+------------+
| | | | | |
+------------------------------------+-------+------------+------------+------------+
| Net increase/(decrease) | | 9 | (4,275) | (4,745) |
| in cash and cash | | | | |
| equivalents | | | | |
+------------------------------------+-------+------------+------------+------------+
| Cash and cash equivalents | | 42 | 4,787 | 4,787 |
| at 1 January | | | | |
+------------------------------------+-------+------------+------------+------------+
| Cash and cash equivalents | | 51 | 512 | 42 |
| at 30 June/ 31 December | | | | |
| | | | | |
+------------------------------------+-------+------------+------------+------------+
| | | | | |
+------------------------------------+-------+------------+------------+------------+
| | | | | |
+------------------------------------+-------+------------+------------+------------+
WESTCITY PLC
CONdensed conSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE HALF YEAR ENDED 30 June 2009
+------------------------+---------+----------+----------+----------+----------+
| | Issued | Share | Other |Retained | Total |
| |Capital | based | capital |earnings | Equity |
| |GBP'000 | payment |reserves | GBP'000 | GBP'000 |
| | | reserve | GBP'000 | | |
| | | GBP'000 | | | |
+------------------------+---------+----------+----------+----------+----------+
| At 1st January 2008 | 743 | 321 | 25,589 | (2,501) | 24,152 |
+------------------------+---------+----------+----------+----------+----------+
| | | | | | |
+------------------------+---------+----------+----------+----------+----------+
| Total income and | - | - | - | (4,843) | (4,843) |
| expense for the | | | | | |
| period | | | | | |
+------------------------+---------+----------+----------+----------+----------+
| Share based payment | - | 69 | - | - | 69 |
+------------------------+---------+----------+----------+----------+----------+
| At 30 June 2008 / 1 | 743 | 390 | 25,589 | (7,344) | 19,378 |
| July 2008 | | | | | |
+------------------------+---------+----------+----------+----------+----------+
| Total income and | - | - | - | (3,327) | (3,327) |
| expense for the period | | | | | |
+------------------------+---------+----------+----------+----------+----------+
| Share based payment | - | 61 | - | - | 61 |
+------------------------+---------+----------+----------+----------+----------+
| Increase in provision | - | - | (18) | 18 | - |
+------------------------+---------+----------+----------+----------+----------+
| At 31 December 2008 | 743 | 451 | 25,571 | (10,653) | 16,112 |
+------------------------+---------+----------+----------+----------+----------+
| Total income and | - | - | - | (2,970) | (2,970) |
| expense for the period | | | | | |
+------------------------+---------+----------+----------+----------+----------+
| Share based payment | - | 40 | - | - | 40 |
+------------------------+---------+----------+----------+----------+----------+
| At 30 June 2009 | 743 | 491 | 25,571 | (13,623) | 13,182 |
+------------------------+---------+----------+----------+----------+----------+
| | | | | | |
+------------------------+---------+----------+----------+----------+----------+
| | | | | | |
+------------------------+---------+----------+----------+----------+----------+
| | | | | | |
+------------------------+---------+----------+----------+----------+----------+
WESTCITY PLC
NOTES TO the CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE HALF YEAR ENDED 30 June 2009
1.BASIS OF PREPARATION
The condensed financial statements have been prepared using accounting policies
consistent with International Financial Reporting Standards and in accordance
with International Accounting Standards (IAS) 34 Interim Financial Reporting and
have not been audited for the period under review.
The financial information contained in this document does not constitute
statutory accounts within the meaning of Section 240 of the Companies Act 1985.
The financial information for the year ended 31st December 2008 is extracted
from the audited financial statements for that year on which the auditors gave
an unqualified report and which did not give a statement under Section 237 (2)
or 237 (3) of the Companies Act 1985. A copy of these 2008 financial statements
has been filed with the Registrar of Companies.
A copy of these 2008 financial statements has been filed with the Registrar of
Companies.
The Group prepares its consolidated financial statements in accordance with
IFRS, and the statements have been prepared using the accounting policies set
out in the Group's 2008 statutory accounts.
The Directors have carefully considered the Group's budget and cashflow to
ensure that the Group has adequate working capital, taking into account the two
year loan facility from Chapman International Investment Limited as outlined in
Note 11 and current negotiations in place with Chapman International Investment
Limited regarding the subsequent working capital requirements on expiry of the
facility with them in June 2010. Overall, the directors have a reasonable
expectation that the Group will have adequate resources and facilities to
continue in the foreseeable future on the basis of securing new working capital
requirements on expiry of the existing facility given the strength of the
underlying investments held by the Group. For this reason, the Directors
continue to adopt the going concern basis in preparing the Half Year Report.
2. SIGNIFICANT ACCOUNTING POLICIES
The condensed financial statements have been prepared on a historical cost basis
or fair value basis as appropriate.
The same accounting policies, presentation and methods of computation are
followed in these condensed financial statements as were applied in the
preparation of the Group's financial statements for the year ended 31 December
2008.
3. SEGMENT INFORMATION
The Group income derives principally from its operations in the UK and Channel
Islands being that of property related investment, development and management.
The directors consider there is no segmental information to be provided on the
basis that the Group is based and operated from the UK with an investment in the
Channel Islands.
4.DIVIDENDS
No dividends were paid or declared in the period (June 2008: Nil, December 2008:
Nil).
5.(LOSS)/EARNINGS PER ORDINARY SHARE
Basic earnings per ordinary share has been calculated on the Group's loss
attributable to shareholders of GBP2,970,000 (June 2008 loss: GBP4,843,000,
December 2008 loss: GBP8,170,000) and on the weighted average number of ordinary
shares in issue during the period which was 74,299,301 (June 2008: 74,299,301,
December 2008: 74,299,301).
There are no potentially dilutive or anti-dilutive share options in the period.
6. PROVISIONS
+-----------------------------------------+-----------+----------+----------+
| | Pension | Onerous | Total |
| | Scheme | property | |
| | deficit | leases | |
+-----------------------------------------+-----------+----------+----------+
| | GBP'000 | GBP'000 | GBP'000 |
+-----------------------------------------+-----------+----------+----------+
| | | | |
+-----------------------------------------+-----------+----------+----------+
| Provision | 268 | 222 | 490 |
| at 1 | | | |
| January | | | |
| 2009 | | | |
+-----------------------------------------+-----------+----------+----------+
| Provision | - | 50 | 50 |
| Increased | | | |
+-----------------------------------------+-----------+----------+----------+
| Provision | (193) | - | (193) |
| settled | | | |
+-----------------------------------------+-----------+----------+----------+
| Provision | - | (52) | (52) |
| utilised | | | |
+-----------------------------------------+-----------+----------+----------+
| Provision | 75 | 220 | 295 |
| at 30 | | | |
| June 2009 | | | |
+-----------------------------------------+-----------+----------+----------+
| | | | |
+-----------------------------------------+-----------+----------+----------+
| Current | 75 | 56 | 131 |
+-----------------------------------------+-----------+----------+----------+
| Non-current | - | 164 | 164 |
+-----------------------------------------+-----------+----------+----------+
| | 75 | 220 | 295 |
+-----------------------------------------+-----------+----------+----------+
| | | | |
+-----------------------------------------+-----------+----------+----------+
Provisions for liabilities
Provision is made in these financial statements for all material liabilities
including any legal claims which are expected to materialise and a lease
liability which has materialised on premises formerly occupied by a Group
company.
The Directors have considered the adequacy of provisions for product liability,
property lease liabilities which have materialised, trade disputes and
environmental issues relating to disposed businesses and consider that adequate
provision has been made, or sufficient funds held in escrow, to meet any
contingent costs.
The Group pension scheme deficit will be repaid by November 2009 at which time
the scheme will effectively cease.
The provision for the Group onerous property leases is still a current
obligation and will be valid until the lease is re-assigned.
7. SHARE CAPITAL
There were no changes to the issued share capital of the Company during the
period.
8. RESERVES
+--------------------------------------------+-----------+------------+-------------+-----------+
| Group | | Share | Other | Retained |
| | | based | capital | earnings |
| | | payments | reserves | |
| | | reserve | | |
| | | | | |
+--------------------------------------------+-----------+------------+-------------+-----------+
| | | GBP'000 | GBP'000 | GBP'000 |
+--------------------------------------------+-----------+------------+-------------+-----------+
| At | | 451 | 25,571 | (10,653) |
| 1 | | | | |
| January | | | | |
| 2009 | | | | |
+--------------------------------------------+-----------+------------+-------------+-----------+
| Share | | 40 | - | - |
| based | | | | |
| payment | | | | |
+--------------------------------------------+-----------+------------+-------------+-----------+
| Retained | | - | - | (2,970) |
| (loss) | | | | |
| for the | | | | |
| period | | | | |
+--------------------------------------------+-----------+------------+-------------+-----------+
| | | | | |
+--------------------------------------------+-----------+------------+-------------+-----------+
| At | | 491 | 25,571 | (13,623) |
| 30 | | | | |
| June | | | | |
| 2009 | | | | |
+--------------------------------------------+-----------+------------+-------------+-----------+
| | | | | |
+--------------------------------------------+-----------+------------+-------------+-----------+
Nature and purpose of other reserves
Share based payments reserve
The share based payments reserve is used to recognise the fair value of options
expensed but not exercised.
Other capital reserves
The other capital reserves arose following the cancellation of amounts included
in the capital redemption reserve and share premium account. The other capital
reserves are not to be treated as representing realised profits of the Company
and will be treated as an undistributable reserve for the purposes of section
264 of the Companies Act 1985, as it may apply to the Company, for so long as
any debts of or claims against the Company as at 11 October 2006 shall remain
outstanding.
9. NET CASH OUTFLOW FROM OPERATING ACTIVITIES
+--------------------------------------------------+-----------+-----------+-----------+
| | Unaudited | Unaudited | Audited |
| | 6 months | 6 months | Year to |
| | to 30 | to 30 | 31 |
| | June | June | December |
| | 2009 | 2008 | 2008 |
+--------------------------------------------------+-----------+-----------+-----------+
| | GBP'000 | GBP'000 | GBP'000 |
+--------------------------------------------------+-----------+-----------+-----------+
| | | | |
+--------------------------------------------------+-----------+-----------+-----------+
| Operating | (2,970) | (4,843) | (8,170) |
| (loss) before | | | |
| tax | | | |
+--------------------------------------------------+-----------+-----------+-----------+
| Loss on sale of property, plant and | - | - | - |
| equipment | | | |
+--------------------------------------------------+-----------+-----------+-----------+
| Depreciation | 13 | 20 | 36 |
+--------------------------------------------------+-----------+-----------+-----------+
| Share based | 40 | - | 130 |
| payments | | | |
| expense | | | |
+--------------------------------------------------+-----------+-----------+-----------+
| Share of | (108) | (49) | (68) |
| profits of | | | |
| equity | | | |
| accounted | | | |
| investment | | | |
+--------------------------------------------------+-----------+-----------+-----------+
| Dividend from equity accounted investment | - | 69 | - |
+--------------------------------------------------+-----------+-----------+-----------+
| Decrease in the fair value of investments | 2,271 | 2,297 | 4,512 |
+--------------------------------------------------+-----------+-----------+-----------+
| Finance income | - | (90) | (91) |
+--------------------------------------------------+-----------+-----------+-----------+
| Finance | - | - | 27 |
| expense | | | |
+--------------------------------------------------+-----------+-----------+-----------+
| Decrease/(increase) | 273 | (111) | 71 |
| in receivables | | | |
+--------------------------------------------------+-----------+-----------+-----------+
| Decrease/(increase) | (19) | (24) | 12 |
| in prepayments | | | |
+--------------------------------------------------+-----------+-----------+-----------+
| Increase/(decrease) | 685 | (1,602) | (1,297) |
| in payables | | | |
+--------------------------------------------------+-----------+-----------+-----------+
| (Decrease)/increase | (176) | (32) | 29 |
| in provisions | | | |
+--------------------------------------------------+-----------+-----------+-----------+
| | 9 | (4,365) | (4,809) |
+--------------------------------------------------+-----------+-----------+-----------+
10. GROUP FINANCIAL COMMITMENTS
The Group had no commitments under non-cancellable operating leases at the
period end.
11. CONTINGENT LIABILITIES
Indemnities and warranties
The Group continues to have contingent liabilities in connection with
indemnities and warranties given to the purchasers of its former businesses. As
no claims have been made under these indemnities and warranties, the Directors
are unable to quantify these potential liabilities.
Property lease liabilities
The Group continues to have contingent liabilities in connection with the
property leases of its former businesses, for which it is exposed to lease
obligations in the event of an assignee's default. The remaining lengths of
these leases range from 3 to 5 years. Whilst all assignees continue to meet
their obligations under these leases, the current annual rent obligations (which
may be subject to periodic reviews), before allowing for any mitigating
activities, for all such leases are approximately GBP352,000 per annum.
No provision has been made in respect of these contingent matters.
Loan facility
The Company secured a two year loan facility from Chapman International
Investment Ltd, the Company's largest shareholder on 4th June 2008. The Company
has granted Chapman a charge over 5 million units in the Fund, as security for
the loan. The loan is repayable at the end of the 2 year period.
The facility will only be drawn down to the extent that the Company's remaining
cash resources for working capital are insufficient.
12. RELATED PARTY TRANSACTIONS
Material transactions in the half year period to 30th June 2009 and as at 30th
June 2009 were as follows:
+--------------------------------------+-----------+------------+-----------+
| | Unaudited | Unaudited | Audited |
| | 6 months | 6 months | Year to |
| | to 30 | to 30 June | 31 |
| | June | 2008 | December |
| | 2009 | | 2008 |
+--------------------------------------+-----------+------------+-----------+
| | GBP'000 | GBP'000 | GBP'000 |
+--------------------------------------+-----------+------------+-----------+
| Loan balance of a two year facility | 1,175 | - | 400 |
| of GBP2 million has been taken out | | | |
| with Chapman International LTD, the | | | |
| company's largest shareholder. | | | |
+--------------------------------------+-----------+------------+-----------+
This information is provided by RNS
The company news service from the London Stock Exchange
END
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