RNS Number:0103I
Hot Tuna (International) plc
23 August 2006
Press Release 23 August 2006
Hot Tuna (International) PLC
("Hot Tuna" or "the Company")
Preliminary Results
Hot Tuna (International) PLC (AIM:HTT), a lifestyle apparel brand with authentic
surf heritage, is pleased to announce its maiden set of Preliminary Results
since being admitted to AiM for the period ended 30 June 2006.
Highlights
* raised #1.9 million at AiM listing and a further #2.5 million in February
2006
* completed acquisitions of US and Australian subsidiary licensee companies
* key operational management appointments completed to support growth
* launch of Spring / Summer 2007 collection in the USA and the UK
* appointment of Elle Macpherson as an Executive Director
* turnover boosted by sales of Hot Tuna trial clothing in the Cocoa Beach
concept store
Commenting on the results, Ranjit Murugason, Chairman of Hot Tuna
(International) PLC, said: "Significant progress has been made since the
Company's flotation on AiM 10 months ago and strong foundations have now been
laid to support Hot Tuna's future growth. We now have direct ownership over the
Hot Tuna brand in all key markets including the USA, the UK and Australia, and
have also appointed several highly-regarded and experienced personnel to drive
the Company's design, marketing and sales.
"We have just launched Hot Tuna's first clothing collection, which is for Spring
/ Summer 2007, and are encouraged from feedback we have received so far from
potential buyers."
- Ends -
For further information:
Hot Tuna (International) PLC
Ranjit Murugason, Chairman Tel: +44 (0) 20 7372 9799
ranjit_murugason@hottunaplc.com
Seymour Pierce Limited
Sarah Wharry / Parimal Kumar Tel: +44 (0) 20 7107 8000
parimalkumar@seymourpierce.com www.seymourpierce.com
Media enquiries:
Abchurch
Henry Harrison-Topham / Chris Lane Tel: +44 (0) 20 7398 7700
henry.ht@abchurch-group.com www.abchurch-group.com
Chairman's Statement
The Directors of Hot Tuna (International) PLC have pleasure in presenting the
Company's results for the period from incorporation to 30 June 2006.
As we approach 2007 with optimism, I am pleased to report upon the progress of
Hot Tuna (International) PLC over the last ten months since the Company's
Admission to AiM, which raised #1.9 million. Since the Company's flotation, we
have made significant progress in re-establishing Hot Tuna as a leading global
surf and youth lifestyle brand.
Amongst Hot Tuna's many achievements during the course of 2006, the Company
consolidated its previously fragmented licensed interests into a vertical
operating business. The Company has also co-ordinated design, marketing and
distribution competence in its largest markets: the United States, Australia
and the United Kingdom. The net result has been increased control of the brand
internationally as well as the introduction of economies-of-scale benefits with
increased potential for profitability in the short term.
Even more important to the immediate and long term success of the business was
the infusion of talent into Hot Tuna's ranks. A team of inspired, experienced
and young designers, marketers, salespeople and management with apparel
expertise have joined us, united by a common mantra: to purvey through
world-class products, events and personalities, the authenticity, creativity and
good times for which the iconic Hot Tuna piranha logo stands.
Consistent with the Hot Tuna's roots as a core surf lifestyle brand, the Company
continues to support the sport of surfing through sponsoring athletes, events
and grass roots surfing and surf schools. In January 2006, the Company
sponsored its first ASP-sanctioned surf competition, the "Hot Tuna Summer
Classic," held in Australia. This month, Hot Tuna is the lead sponsor for the
prestigious European surf competition, the fifth leg of the BPSA UK Tour, to be
held at Porthmeor Beach, St. Ives, Cornwall.
In July 2006 the Company launched its women's swimwear collection at the Miami
Swim Show and, during this summer, plans to launch its first comprehensive
women's swim and men's and women's apparel collection from Hot Tuna for 2007 at
MAGIC and ASR trade shows in Las Vegas and San Diego respectively. These are
the two most important apparel and action sports trade shows in the USA. In the
UK, the Spring / Summer 2007 Hot Tuna collection will be launched at the Surf
Shop in September 2006, the leading surf, skate and boardriding trade show in
the UK.
Through significant strategic effort and alignment, Hot Tuna has ended this
fiscal year with a solid global infrastructure and strong leadership. This
includes the addition of fashion entrepreneur Elle Macpherson to the Company's
Board of Directors, as well as a growing team of branded athletes, artists and
musicians whose sensibilities exemplify Hot Tuna's brand. The Company is now
revitalised: the foundations of a truly global lifestyle brand are in place,
industry luminaries have joined the business and Hot Tuna product is finding
itself shoulder-to-shoulder with the biggest names in surf fashion.
Operational Review
United States
In November 2005, Hot Tuna (International) PLC purchased a 51 percent
controlling interest in the Company's licensed business in the United States,
reincorporating the new joint venture as Hot Tuna International Inc. In May
2006, the Company completed its acquisition of the remaining 49 percent of Hot
Tuna's U.S. operations, further testament to our financial commitment to global
infrastructure and a critical step in the evolution of the Company, laying the
groundwork for direct control and greater returns in the largest surf lifestyle
market in the world.
In concert with the consolidation of our North American business and in line
with our goals of better specialty and department store distribution, the
Company successfully inaugurated the "Hot Tuna Core Store", a concept 'store
within a store' within Cocoa Beach Surf Company in Florida, the world's largest
surf complex. Other retail successes include a successful Hot Tuna men's wear
launch with Jack's Surf Shop in Huntington Beach, California, the reigning
'Retailer of the Year' as determined by the Surf Industry Manufacturers
Association.
Hot Tuna concluded its fiscal period with the move of global design, marketing
and sales operations to the epicentre of surfing: coastal Orange County,
California. To steer the Company from its Stateside berth, a top level design
and executive team has been recruited. New staff were attracted from the ranks
of Quiksilver, Ocean Pacific, Perry Ellis International and Ripcurl, with Tim
Bernardy, a lauded 15 year veteran of O'Neill, leading the team as Chief
Operating Officer of our US operations.
United Kingdom
In December 2005, the Company negotiated a 75 percent interest in Map Print Ltd
("MAP"), a UK-based street wear label and retailer of several promising
lifestyle apparel and accessories brands. In addition to the opportunities
associated with growing the MAP brands within the UK and internationally, its
existing infrastructure and associated design, manufacturing and distribution
competencies have allowed Hot Tuna to fast track its operations in Europe, as
well as adding to the Company's overall creative efforts in the US and
Australia. Management was bolstered with the appointment of Chris Dewbury as
Chief Operating Officer for UK operations. Chris is an industry veteran of many
years, with an extensive knowledge of the lifestyle industry. He has worked
with some major brands and, as sales manager for Quiksilver, led the exponential
growth of Quiksilver sales in the UK during the last decade.
Australia
In furtherance of its overall strategy to absorb our licensed businesses in core
markets, Hot Tuna (International) PLC entered into a contract with MCU Pty Ltd
(the Hot Tuna license-holder in Australia) on 30 June 2006, to acquire our
licensing rights in our heritage market. The purchase allowed us entry into Hot
Tuna's birthplace and into the perennial surf destinations of New Zealand, New
Guinea, Fiji, New Caledonia and Samoa. Industry veteran Dean Harrigan, who in
the past has owned the license to such brands as Bad Boy and Ocean Pacific in
Australia, was brought on board as Chief Operating Officer for the Australian
and New Zealand operations.
In Australia, there remains a strong allegiance to the brand that has not been
diluted. Summer 2007 will be the focus of a comprehensive sales launch although
the brand had early success with a trial range opening in several core surf
accounts including City Beach and Glue in Australia, and Point Break in
Indonesia.
Results Summary
The Company's aggressive global launch and subsequent expansion has resulted in
high cash expenditures in the period to 30 June 2006. The Group loss for the
period was #1.98 million, comprised mainly of employee costs #1.03 million and
marketing costs #0.38 million. Additional unexpected expenditure was incurred
as the Company absorbed the pre-acquisition losses of Hot Tuna International
Inc. and the outside equity interest value of this current reporting period's
loss #0.15 million. The high cash expenditure in the first year reflects the
Group's commitment to commissioning the right management and personnel to drive
the Group into the next phase of the Company's strategy. This includes building
the designs, sample ranges and infrastructure required to enter our target
markets with a comprehensive range of men's, women's and women's swim apparel
for Spring/Summer 2007. The Company continues to seek highly visible
affirmations of its commitment to the sport and spirit of surfing, and its
support of Hot Tuna's retail partners and customers.
Moving Forward
Hot Tuna's immediate focus is, quite simply, product and sales: to take
advantage of its consolidated business operations in Australia, the United
Kingdom and the United States, leveraging the economies of scale benefits in
design, production, distribution and marketing during what promises to be a busy
trade season.
As a vertical operating business, Hot Tuna will be focused on 2007, with
cutting-edge design, product quality and delivery of service to a core and
upscale retail distribution in key markets. The Company will continue to
maximise its existing human resources and infrastructure, supporting its
distribution strategy, whilst further supporting the business in our core
regions through innovative online, print and event marketing.
On behalf of the Board I wish to thank my fellow directors, our employees,
manufacturing partners, and all those who have assisted Hot Tuna (International)
PLC in its endeavours during the year. We look forward to a rewarding future
for all our friends and stakeholders, and to taking the business of surf to new
heights through the merits of Hot Tuna.
Ranjit Murugason
Chairman
23 August 2006
CONSOLIDATED INCOME STATEMENT
FOR THE PERIOD ENDING TO 30 JUNE 2006
NOTES Period ended
30/06/06
#
Continuing Operations
Revenue 367,992
Cost of sales (204,658)
Gross profit 163,334
Other operating income 4,642
Selling and marketing expenses (383,196)
General and Administrative expenses (1,833,161)
Depreciation and amortisation (3,095)
Loss from operations 1 (2,051,476)
Investment income 39,474
Loss on disposal of property, plant and equipment (949)
Finance costs (4,841)
Loss before tax (2,017,792)
Tax -
Loss after tax (2,017,792)
Loss for the period (2,017,792)
Attributable to:
Equity holders (1,975,718)
Minority interest (42,074)
(2,017,792)
Loss per share
Basic and Diluted 2 (#0.06)
CONSOLIDATED AND COMPANY BALANCE SHEET
as at 30 June 2006
NOTES 2006 2006
Group Company
# #
ASSETS
Non-current assets
Goodwill 237,338 -
Other intangible assets 5,251,429 3,083,000
Property, plant and equipment 73,616 18,969
Investments - 1,998,226
Intercompany loan assets - 1,567,576
5,562,383 6,667,771
Current assets
Inventories 171,674 -
Trade and other receivables 183,624 63,663
Cash and cash equivalents 1,524,255 1,372,271
1,879,553 1,435,934
TOTAL ASSETS 7,441,936 8,103,705
LIABILITIES
Current liabilities
Bank loans and overdraft 110,842 -
Trade and other payables 281,626 145,117
Current liabilities 392,468 145,117
Net current assets 1,487,085 1,290,817
NET ASSETS 7,049,468 7,958,588
EQUITY
Share capital 488,010 488,010
Share-based payment reserve 576,855 576,855
Share premium reserve 6,092,232 6,092,232
Merger reserve 1,474,000 1,474,000
Warrant reserve 486,557 486,557
Foreign exchange reserve (4,017) -
Shares to be issued 25,000 25,000
Retained loss (1,975,718) (1,184,066)
Equity attributable to equity holders of the parent 7,162,919 7,958,588
Minority interest (113,451) -
TOTAL EQUITY 7,049,468 7,958,588
STATEMENT OF CHANGES IN EQUITY FOR THE PERIOD ENDED 30 JUNE 2006
Attributable to equity holders of the Group
CONSOLIDATED Share Share Share based Other Warrant Retained Total
capital premium payment reserves reserve profit/(loss) equity
account reserve
# # # # # # #
Balance at 1 April 2005 - - - - - - -
Share conversion and issue 488,010 7,390,490 - 1,474,000 - - 9,352,500
Costs of share issue and - (1,298,258) - - - - (1,298,258)
conversion
Warrants Subscribed - - - - 486,557 - 486,557
Shares to be issued - - - 25,000 - - 25,000
Employee share option - - 90,695 - - - 90,695
scheme
Share based payments to - - 312,172 - - - 312,172
advisors
Share based payment on - - 173,988 - - - 173,988
acquisition
Net loss for the period - - - - - (1,975,718) (1,975,718)
Currency translation - - - (4,017) - - (4,017)
adjustments
Balance at 30 June 2006 488,010 6,092,232 576,855 1,494,983 486,557 (1,975,718) 7,162,919
COMPANY
Balance at 1 April 2005 - - - - - - -
Share conversion and issue 488,010 7,390,490 - 1,474,000 - - 9,352,500
Costs of share issue and - (1,298,258) - - - - (1,298,258)
conversion
Warrants Subscribed - - - - 486,557 - 486,557
Shares to be issued - - - 25,000 - - 25,000
Employee share option - - 90,695 - - - 90,695
scheme
Share based payments to - - 312,172 - - - 312,172
advisors
Share based payment on - - 173,988 - - - 173,988
acquisition
Net loss for the period - - - - - (1,184,066) (1,184,066)
Currency translation - - - - - - -
adjustments
Balance at 30 June 2006 488,010 6,092,232 576,855 1,499,000 486,557 (1,184,066) 7,958,588
CONSOLIDATED CASH FLOW STATEMENT
FOR THE PERIOD ENDED 30 JUNE 2006
Group Company
Period Ending Period Ending
NOTES 30/06/06 30/06/06
# #
NET CASH USED IN OPERATING ACTIVITIES 3 (1,925,622) (2,550,011)
INVESTING ACTIVITIES
Currency revaluation reserve (4,017) -
Payments for purchase of controlled entity (606,770) (153,499)
Cash funding on purchase of controlled entities (178,333) (178,333)
Payments for intangible assets (283,000) (283,000)
Interest received 39,474 35,853
Purchases of property, plant and equipment (38,446) (19,708)
NET CASH USED IN INVESTING ACTIVITIES (1,071,092) (598,687)
FINANCING ACTIVITIES
Proceeds from issue of share capital 4,520,969 4,520,969
Net Increase (decrease) in cash and cash equivalents 1,524,255 1,372,271
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD - -
CASH AND CASH EQUIVALENTS AT END OF PERIOD 1,524,255 1,372,271
CONSOLIDATED FINANCIAL STATEMENTS
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) General Information
Hot Tuna (International) PLC is a company incorporated in the United Kingdom
under the Companies Act 1985. The address of the registered office is given on
page 2. The nature of the Group's operations and its principal activities are
set out in note 13 and in the Chairman's Statement.
These financial statements are presented in pounds sterling because that is the
currency of the primary economic environment in which the Group operates.
Foreign operations are included in accordance with the policies set out in note
(f).
At the date of authorisation of these financial statements the following
Standards and Interpretations which have not been applied in these financial
statements were in issue but not yet effective:
IFRS 6 Exploration for and Evaluation of Mineral Resources
IFRS 7 Financial instruments: Disclosures; and the related amendment to IAS 1
on capital disclosures
IFRIC 4 Determining whether an Arrangement contains a Lease
IFRIC 5 Rights to Interest Arising from Decommissioning, Restoration and
Environmental Rehabilitation Funds
IFRIC 7 Applying the Restatement Approach under IAS 29 Financial Reporting in
Hyperinflationary Economies
IFRIC 8 Scope of IFRS 2 Share-based Payment
IFRIC 9 Reassessment of Embedded Derivatives
The directors anticipate that the adoption of these Standards and
Interpretations in future periods will have no material impact on the financial
statements of the Group when the relevant standards and interpretations come
into effect.
(b) Basis of preparation
The financial information for the period ended 30 June 2006 has not been audited
and does not constitute the Company's statutory financial statements within the
meaning of s240 of the Companies Act 1985. The preliminary report was approved
by the Board on 22 August 2006. The statutory accounts for the year ended 30
June 2006 have not been filed with the Registrar of Companies nor reported on by
the Companies auditors.
(c) Basis of consolidation
The consolidated financial statements incorporate the financial statements of
the Company and enterprises controlled by the Company (and its subsidiaries)
made up to 30 June.
The results of subsidiaries acquired or disposed of during the period are
included in the consolidated income statement from the effective date of
acquisition or up to the effective date of disposal, as appropriate.
Where necessary, adjustments are made to the financial statements of
subsidiaries to bring the accounting policies used into line with those used by
other members of the Group.
All intra-group transactions, balances, and unrealised gains on transactions
between group companies are eliminated on consolidation. Unrealised losses are
also eliminated unless the transaction provides evidence of an impairment of the
asset transferred.
The acquisition of subsidiaries is accounted for using the purchase method. The
cost of the acquisition is measured at the aggregate of the fair values, at the
date of the exchange, of assets given, liabilities incurred or assumed, and
equity instruments issued by the Group in exchange for control of the acquiree,
plus any costs directly attributable to the business combination. The
acquiree's identifiable assets, liabilities and contingent liabilities that meet
the conditions for recognition under IFRS 3 are recognised at their fair value
at the acquisition date.
Goodwill arising on acquisition is recognised as an asset and initially measured
at cost, being the excess of the cost of the business combination over the
Group's interest in the net fair value of the identifiable assets, liabilities
and contingent liabilities recognised. If, after re-assessment the Group's
interest in the net fair value of the acquiree's identifiable assets,
liabilities and contingent liabilities exceeds the cost of the business
combination, the excess of recognised immediately in the profit or loss.
The interest of minority shareholders in the acquiree is initially measured at
the minority's proportion of the net fair value of the assets, liabilities and
contingent liabilities recognised.
(d) Investments in subsidiaries and associates
There are no associates, nor joint ventures in the Group.
(e) Leasing
Leases are classified as finance leases whenever the terms of the lease transfer
substantially all the risks and rewards of ownership to the lessee. All other
leases are classified as operating leases.
The Group as lessee
Rentals payable under operating leases are charged to income on a straight-line
basis over the term of the relevant lease.
Benefits received and receivable as an incentive to enter into an operating
lease are also spread on a straight line basis over the lease term.
(f) Foreign currencies
Transactions in currencies other than Pounds Sterling are recorded at the rates
of exchange prevailing on the dates of the transactions. At each balance sheet
date, monetary assets and liabilities that are denominated foreign currencies
are retranslated at the rates prevailing on the balance sheet date. Non-monetary
assets and liabilities carried at fair value that are denominated in foreign
currencies are translated at the rates prevailing at the date when the fair
value was determined. Gains and losses arising on retranslation are included in
the income statement for the period, except for exchange differences on
non-monetary assets and liabilities where the changes in fair value are
recognised directly in equity.
On consolidation, the assets and liabilities of the Group's overseas operations
are translated at exchange rates prevailing on the balance sheet date. Income
and expense items are translated at the average exchange rates for each month in
the period. Exchange differences arising, if any, are classified as equity and
transferred to the Group's foreign exchange reserve. Such translation
differences are recognised as income or as expenses in the period in which the
operation is disposed of.
(g) Taxation
The tax expense represents the sum of the tax currently payable and deferred
tax.
The tax currently payable is based on taxable profit for the year. Taxable
profit/(loss) differs from net profit/(loss) reported in the income statement
because it excludes items of income or expense that are taxable or deductible in
other years and it further excludes items that are never taxable or deductible.
Deferred tax is the tax expected to be payable or recoverable on differences
between the carrying amounts of assets and liabilities in the financial
statements and the corresponding tax bases used in the computation of taxable
profit and is accounted for using the balance sheet liability method. Deferred
tax liabilities are generally recognised for all taxable temporary differences
and deferred tax assets are recognised to the extent that it is probable that
taxable profits will be available against which deductible temporary differences
can be utilised. Such assets and liabilities are not recognised if the
temporary differences arises from the initial recognition of goodwill or from
the initial recognition (other than in a business combination) of other assets
or liabilities in a transaction that affects neither the tax profit nor the
accounting profit.
The carrying amount of deferred tax assets are reviewed at each balance sheet
date and reduced to the extent that it is no longer probable that sufficient
taxable profits will be available to allow all or part of the asset to be
recovered.
Deferred tax is calculated at the tax rates that are expected to apply in the
period when the liability is settled or the asset is realised. Deferred tax us
charged or credited in the income statement, except when it relates to items
charged or credited directly to equity, in which case deferred tax is also dealt
with in equity.
(h) Property, plant and equipment
Items of property, plant and equipment are stated at cost less accumulated
depreciation (see below) and impairment losses (see accounting policy j).
Where parts of an item of property, plant and equipment have different useful
lives, they are accounted for as separate items of property, plant and
equipment.
Leases in terms of which the Group assumes substantially all the risks and
rewards of ownership are classified as finance leases. Lease payments are
accounted for as described in accounting policy e.
Depreciation is provided on all other property, plant and equipment at rates
calculated to write each asset down to its estimated residual value evenly over
its expected useful life as follows:-
Freehold Buildings and Improvements 3-5 years straight line
Motor Vehicles 3-5 years straight line
Fixtures and fittings 3-5 years straight line
Office Equipment 3-5 years straight line
(i) Intangible assets and goodwill
Goodwill is stated at cost less any accumulated impairment losses. Goodwill is
allocated to cash generating units and is tested annually for impairment (see
accounting policy j).
On disposal of a subsidiary, associate or jointly controlled entity, the
attributable amount of goodwill is included in the determination of the profit
or loss on disposal.
Negative goodwill arising on acquisition is recognised directly in the income
statement.
The value of the Hot Tuna brand has been derived on acquisition of the license
holding subsidiaries. It has been measured as the excess of the cash
consideration over the net asset position of the subsidiary.
The value of the Hot Tuna brand and associated licenses have not been amortised
as they are considered to have an indefinite life.
(j) Impairment
The carrying amounts of the Group's assets are reviewed at each balance sheet
date to determine whether there is any indication of impairment. If any such
indication exists, the asset's recoverable amount is estimated. For goodwill
and assets that have an indefinite useful life, the recoverable amount is
estimated at each balance sheet date. An impairment loss is recognised whenever
the carrying amount of an asset or its cash generating unit exceeds its
recoverable amount.
Impairment losses are recognised in the income statement.
(k) Inventories
Stock is stated at the lower of cost and net realisable value. Net realisable
value is the estimated selling price in the ordinary course of business, less
the estimated costs of completion and selling expenses.
(l) Share based payments
The Group has applied the requirements of IFRS 2 to share option schemes
allowing certain employees within the Group to acquire shares of the Company.
For all grants of share options, the fair value as at the date of grant is
calculated using the Black and Scholes option pricing model, taking into account
the terms and conditions upon which the options were granted. The amount
recognised as an expense is adjusted to reflect the actual number of share
options that are likely to vest, except where forfeiture is only due to market
based conditions not achieving the threshold for vesting. The expense is
recognised over the expected life of the option.
(m) Provisions
Provisions are recognised when the Group has a present obligation as a result of
a past event which it is probable will result in an outflow of economic benefits
that can be reliably estimated.
(n) Trade and other receivables
Trade and other receivables are stated at their cost less impairment losses (see
note j).
(o) Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits. Bank
overdrafts that are repayable on demand and form an integral part of the Group's
cash management are included as a component of cash and cash equivalents for the
purpose of the statement of cash flows.
(p) Revenue
Revenue results from a) amounts received and receivable for goods and services
provided (excluding value added tax) and b) royalty income receivable on the
existing license agreements
Royalty income is recorded when it becomes receivable in accordance with the
individual contractual agreements.
Sales are recognised when goods are when goods are invoiced to the customer.
(q) Financial instruments
The Company's financial instruments comprise cash together with various items
such as trade and other receivables and trade and other payables etc, that arise
directly from its operations. The main purpose of these financial instruments
is to provide working capital.
Financial assets and financial liabilities are recognised on the Group's balance
sheet when the Group has become a party to the contractual provisions of the
instrument.
Trade receivables
Trade receivables do not carry any interest and are stated at their nominal
value as reduced by appropriate allowances for estimated irrecoverable amounts.
Financial liability and equity
Financial liabilities and equity instruments are classified according to the
substance of the contractual arrangements entered into. An equity instrument is
any contract that evidences a residual interest in the assets of the Group after
deducting all of its liabilities.
Bank borrowings
Interest-bearing bank loans and overdrafts are recorded at the proceeds
received, net of direct issue costs. Finance charges, including premiums payable
on settlement or redemption, are accounted for on an accrual basis and are added
to the carrying amount of the instrument to the extent that they are not settled
in the period in which they arise.
Trade payables
Trade payables are not interest bearing and are stated at their nominal value.
Equity instruments
Equity instruments issued by the Company are recorded at the proceeds received,
net of direct issue costs.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD 3 MARCH 2005 TO 30 JUNE 2006
1 LOSS FROM OPERATIONS
Loss from operations has been arrived at after charging/(crediting):
Period ended 30/06/06
#
Depreciation
- owned assets 3,095
Loss on disposal of fixed assets 949
Staff costs 1,039,085
Net foreign exchange gains/(losses) 11,501
2 LOSS PER SHARE
The calculation of the basic and diluted earnings per share is based on the
following data:
Period ended
30/06/06
Earnings #
Earnings for the purposes of basic earnings per share net loss (1,975,718)
for the period attributable to equity holders of the parent)
Number of shares
Weighted average number of ordinary shares for the purposes 32,471,760
of basic earnings per share
The denominator for the purpose of calculating the basic earnings per share
has been adjusted to reflect all capital raisings. Due to the loss
incurred in the period, there is no dilution effect resulting from the
issue of share options, warrants and shares to be issued.
3 RECONCILIATION OF PROFIT FROM OPERATIONS TO NET USED IN OPERATING
ACTIVITIES (NOTES TO THE CASH FLOW STATEMENT)
Group Company
Period Ending Period Ending
30/06/06 30/06/06
# #
Loss from operations (2,051,476) (1,218,952)
Adjusted for:
Depreciation of property, plant & equipment 3,095 1,647
Loss on disposal of property, plant and 949 949
equipment
Share based payment expense 90,695 90,695
Operating cash flows before movements in (1,956,736) (1,125,661)
working capital
Increase in inventories (27,109) -
Increase in receivables (102,162) (1,569,450)
Increase in payables 165,227 145,117
Cash used in operations 35,956 (1,424,333)
Interest (Paid)/Received (4,841) (17)
NET CASH FROM OPERATING ACTIVITIES (1,925,622) (2,550,011)
Bank balances and cash comprise cash and short-term deposits held by the
group treasury function. The carrying value of these assets approximates
fair value and is broken down as follows:
Group Company
Period Ending Period Ending
30/06/06 30/06/06
# #
Cash and cash equivalents 1,524,255 1,372,271
This information is provided by RNS
The company news service from the London Stock Exchange
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