Final Results
November 11 2003 - 2:00AM
UK Regulatory
RNS Number:8889R
Ringprop PLC
11 November 2003
RingProp plc
11 November 2003
RingProp PLC (the "Company")
PRELIMINARY RESULTS FOR THE PERIOD ENDED 30 SEPTEMBER 2003
RingProp plc, the marine propeller design and sales company, today announces its
results for the 14 month period ended 30 September 2003.
RingProp plc was formed to exploit the potential of a ground-breaking marine
propeller technology, the 'RingProp'. The company which has its head office at
the Haslar Marine Technology Park, was floated on the AIM market on 22 November
2002 and a total of #3,264,065, before flotation expenses, was raised.
Progress to date
Since flotation the group has been researching in detail the market and
technology of the RingProp concept. In July 2003, the group agreed a major
strategic manufacturing venture in collaboration with a leading international
diecasting company, JL French (UK) Ltd. This work, further to the research
conducted prior to flotation and the proposed alliance with JL French (UK) Ltd,
led to a decision to manufacture the RingProp in aluminium rather than in the
originally proposed composite material. This important change has led to a
short delay with first commercial sales now anticipated in summer 2004.
However the move to aluminium is expected to accelerate acceptance in the market
place worldwide and lead to a faster build-up of sales volumes. The alliance
with JL French (UK) Ltd secures the source and capacity for high quality product
required to service the company's target markets with the added advantage that
JL French (UK) Ltd will become a shareholder through the agreed financing of the
tooling, thus demonstrating their confidence in the product.
There have been no revenues in the period ended 30 September 2003.
Cavitation testing has been undertaken at Qinetiq's Haslar site, which is the
centre of hydrodynamic research for the Ministry of Defence.
A company research centre has been set up in Melbourne, Australia, where the
test programme has been running since July using instrumentation specially
developed to record the performance of the RingProp in action. Performance is
being measured on a selection of boats and engine sizes, which reflect the
target market of the company, namely engines from 25hp to 250hp.
The test results are being used to ensure high performance across the RingProp
range and full scale manufacture of a range viable for launch is on schedule for
the summer of 2004.
Industry litigation
Current litigation within the US has the potential to precipitate the need for
improved safety, as indicated by the following two cases:
Landmark US Supreme Court ruling
As reported at the time of the interim results, the Supreme Court of the
United States in December 2002, handed down an important judgement
concerning a public liability action against a conventional propeller
manufacturer (Sprietsma vs. Mercury Marine.). This ruling could result in a
significant number of lawsuits being brought by a backlog of injured
parties against outboard engine manufacturers.
Yamaha settles out of court in US
In a more recent case, Yamaha and other defendants settled out of court on
3 September 2003 for $6 million (original claim $63 million) to a claimant
totally paralysed when struck on the arm, head and neck by a propeller.
The directors believe that these developments, and the possible further
litigation derived from them, may contribute to the establishment of the
RingProp propeller as the viable alternative to conventional open-bladed
propellers, offering a safer alternative to the dangerous cutting tips of a
conventional propeller.
Financial
The accounts for the period to 30 September 2003 show a loss of #906,852. The
cash balance was #1,868,232 after flotation costs of #409,680.
No final dividend has therefore been declared.
Board changes
On 31 July the company announced the resignation of Johnny Townsend from the
company acknowledging his significant contribution to the launch of the company.
Denis Mulhall was appointed as non-executive chairman in his place.
Giselle Sweet-Escott was appointed finance director on 1 July 2003 in place of
Martin Jackson who resigned to pursue other interests.
Prospects
The company's focus in the immediate term is on marketing and distribution, the
priority market being the USA. The company's resources will be focused on
promoting RingProp to the marine industry through boatshows, original equipment
manufacturers, distributors and other channels. The company is currently
developing a sales strategy for the USA and has engaged the services of a highly
regarded American marine marketing agency to support its efforts. The company
has become a member of the British Marine Federation which is supporting the
development of its export plans.
In the company's prospectus, reference was made to an order from the Australian
armed forces for a stainless steel version of the RingProp; this was to be
satisfied by, and as for the benefit of, the Australian company that transferred
its technology to RingProp plc on flotation and which is now a major
shareholder. Part of this order has been executed and the results indicate
excellent potential for the military market in general.
We look forward to the future with confidence, in the belief that the RingProp
offers a safer product to the boating community. We believe that we have the
basis to build RingProp into a profitable entity and anticipate initial sales in
the summer of 2004.
Denis Mulhall
Chairman
11 November 2003
Consolidated profit and loss account for the 14 months ended 30 September 2003
14 months ended
30 September 2003
2003
#'000
Administrative expenses
Other (731)
Amortisation of intangible assets (233)
_______
Group operating loss (964)
_______
Other interest receivable and similar income 57
_______
Loss on ordinary activities before and
after taxation and retained loss for the year (907)
Loss per share
Basic and diluted loss per ordinary 10p share (21.0)p
Consolidated balance sheet at 30 September 2003
2003 2003
#'000 #'000
Fixed assets
Intangible assets 4,405
Tangible assets 53
_______
4,458
Current assets
Debtors 183
Cash at bank and in hand 1,868
_______
2,051
Creditors: amounts falling due within one year (38)
_______
Net current assets 2,013
_______
Total assets less current liabilities 6,471
_______
Capital and reserves
Called up share capital 597
Share premium account 6,001
Merger reserve 741
Profit and loss account (868)
_______
Shareholders' funds - equity interests 6,471
_______
Consolidated cash flow statement for the 14 months ended 30 September 2003
2003 2003
#'000 #'000
Net cash outflow from operating activities (879)
Returns on investments and
servicing of finance
Interest received 57
_______
Net cash inflow from returns on
investment and servicing of finance 57
Capital expenditure and financial investment
Purchase of tangible fixed assets (58)
Purchase of intangible assets (132)
_______
Net cash outflow from capital expenditure and
financial investment (190)
Acquisitions and disposals
Cash acquired with subsidiaries 26
_______
Net cash inflow from acquisitions
and disposals 26
_______
Net cash outflow before financing (986)
Financing
Issue of share capital 3,264
Issue costs (410)
_______
Cash inflow from financing 2,854
_______
Increase in cash and net funds in the period 1,868
_______
Notes
1. The financial information set out in this announcement does not constitute
the Group's statutory accounts for the period ended 30 September 2003, but is
derived from those accounts. Statutory accounts for the period ended 30
September will be delivered to the Registrar of Companies following the Group's
Annual General Meeting. The auditors have reported on those accounts; their
reports were unqualified and did not contain statements under the Companies Act
1985, S237(2) or (3). Copies of the full statutory accounts will be dispatched
to shareholders in due course.
2. Copies of this announcement and the full statutory accounts will be
available from the registered office at Haslar Marine Technology Park, Haslar
Road, Gosport, Hampshire, PO12 2AG, and from the offices of the Group's
nominated advisor, Durlacher Ltd, at 4 Chiswell Street, London, EC1Y 4UP.
3. The calculation of the basic loss per ordinary share is based on a loss of
#906,852 and on 4,314,986 ordinary shares, being the weighted average number of
ordinary shares in issue during the period. The potentially dilutive issuable
ordinary shares are only included in the calculation of diluted earnings per
share if their issue would increase net loss per share.
4. Reconciliation of movements in shareholders' funds
Group
2003
Loss for the period (868)
Nominal value of ordinary shares issued 597
Premium on issue of shares 6,411
Share issue costs (410)
Merger reserve created on share for 741
Share exchange
_______
Closing shareholders funds 6,471
Notice is hereby given that the Annual General Meeting of the shareholders will
be held on 9 December 2003 at 11.00am at the offices of Thomas Eggar, 76 Shoe
Lane, London, EC4A 3JB.
For further information please contact Denis Mulhall, chairman, on 07767 353160.
This information is provided by RNS
The company news service from the London Stock Exchange
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