RNS Number:2424O
Europasia Education PLC
30 June 2005
Embargoed 7am Thursday 30 June 2005
EUROPASIA EDUCATION PRELIMINARY RESULTS:
FIVEFOLD INCREASE IN TURNOVER
EuropAsia Education plc ("EPE"), the AIM-listed education investment group,
announces its audited results for the year ended 31 December 2004.
Highlights:
* Turnover up five fold at #360,188 (2003: 58,451)
* Net Assets increase by more than 30 per cent at #1,015,104 (2003:
#777,902)
* Losses down 22 per cent at #287,144 (2003: #356,069)
* Return to profitability predicted
* Further investments progressing
EPE Chairman James Holmes said: "Turnover has risen fivefold in the year as a
result of the acquisition in July 2004 of Bournemouth Educational Centre Limited
("BECL"). Only five months of results for BECL are shown in the accounts. The
full year benefit of the acquisition will come through in the 2005 accounts."
"The profits generated from the existing investments, coupled with continued
reduction in overheads should return the company to profitability in the second
half of 2005. Your board is seeking to expand its portfolio of investments in
both the UK and China, and is currently in talks with a number of profitable
businesses in both locations. The Directors look forward to building on the
foundations we have established in the last two years and to returning the
company to profit".
-ends-
For further information:
James Holmes, Chairman 020 7248 7578
EuropAsia Education plc
Paul Quade 020 7248 8010
CityRoad Communications 07947 186694
CHAIRMAN'S STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2004
Results
I am pleased to announce a considerable strengthening in the Company's position
in the year ended 31st December 2004, with net assets increased over 30% from
#777,902 to #1,015,104, and cash at the year end of #578,806. Since the year end
the Company has further increased its assets via the acquisition of a 12 per
cent shareholding in Ample Gains Investments Ltd ("AGI"), which manages a
university in China, for #1.0 million. The stake was paid for via the issue of
55.87 million shares at a price of 1.5p per share and a cash payment of
#156,000.
Turnover has risen five-fold in the year, primarily as a result of the
acquisition in July 2004 of Bournemouth Educational Centre Limited ("BECL") for
#754,689. Because the acquisition was made mid way through the year, only five
months results for BECL are shown in the accounts for the year ended 31st
December 2004. The full benefit of the acquisition will come through in the 2005
accounts.
Despite the considerable expansion of the business, with a number of
opportunities being worked on by our teams in both the UK and China, losses
before tax, interest, depreciation and amortisation have been reduced from
#356,069 to #287,143 for the year ended 31st December 2004.
Review Of Investments
BECL operates a profitable Language and Vocational Training Centre in
Bournemouth, UK, attracting students from around the world. The Company trades
as English 2000 (www.english2000.com). Since our acquisition, BECL has
introduced new high margin courses while dropping those with lower margins.
Columbia International Investments Ltd, which trades as Management
International, has implemented the first two of it's consultancy contracts.
These relate to teacher training methods and English as a means of obtaining
employment. The fees and margins are much higher in this new area of business
than the conventional Leonardo training, and the company will seek to build this
area of the business.
EPE Consulting Limited was established during the year to exploit the
opportunities that we have identified in China for course delivery, in
conjunction with BECL and SIIT.
As stated above, in February 2005 we acquired a 12 per cent stake in AGI, the
management company for a Chinese university, The Shandong International
Institute of Translation ("SIIT"). SIIT currently has 8,000 students, and we
look forward to benefiting from the opportunity to bring students from there to
BECL.
Outlook.
The profits generated from the existing investments, coupled with continued
reductions in overheads, should return the company to profitability in the
second half of 2005. Your board is seeking to expand our portfolio of
investments in both the UK and China and are currently in talks with a number of
profitable businesses in both locations. The Directors look forward to building
on the foundations we have established in the last two years and to returning
the company to profit.
James Holmes
Chairman
29th June 2005
CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2004
Year Ended Year Ended
31 December 31 December
2004 2003
Notes # # # #
Turnover
Continuing operations;
Ongoing 130,497 1,500
Acquisitions 229,691 56,951
--------- ---------
360,188 58,451
Cost of Sales (164,818) (45,031)
--------- ---------
Gross Profit 195,370 13,420
Administrative expenses
Provision for diminution
in value of fixed asset
investment - 21,356
Exceptional costs in
respect of readmission - 41,305
Expenses incurred in
respect of the previous
investment strategy - 76,423
Other administrative
expenses 482,513 230,405
--------- 482,513 --------- 369,489
--------- ---------
Operating loss before tax,
interest, depreciation
and amortisation (287,143) (356,069)
Depreciation of tangible
assets 11,948 1,107
Amortisation of goodwill 40,163 10,179
--------- (52,111) --------- (11,286)
--------- ---------
Operating loss (339,254) (367,355)
Continuing operations;
Ongoing (345,104) (360,027)
Acquisitions 5,850 (7,328)
Other interest receivable
and similar income 20,095 5,989
Interest payable (3,220) -
--------- ---------
Loss on ordinary
activities before
taxation (322,379) (361,366)
Tax on loss on
ordinary activities 1,359 -
--------- ---------
Loss on ordinary
activities after
taxation (321,020) (361,366)
--------- ---------
2004 2003
Pence Pence
Basic loss per share 1 0.220 0.479
The profit and loss account has been prepared on the basis that all operations
are continuing.
There are no recognised gains and losses other than those passing through the
profit and loss account.
CONSOLIDATED BALANCE SHEET
AS AT 31 DECEMBER 2004
2004 2003
Notes # # # #
Fixed assets
Intangible assets 628,547 193,396
Tangible assets 36,767 2,437
Investments 66,040 66,040
--------- ---------
731,354 261,873
Current assets
Debtors 58,486 62,544
Cash at bank and
in hand 578,806 500,966
--------- ---------
637,292 563,510
Creditors: amounts
falling due within
one year (349,848) (47,481)
--------- ---------
Net current assets 287,444 516,029
--------- ---------
Total assets less
current liabilities 1,018,798 777,902
Provisions for
liabilities and charges
Deferred Taxation (3,694) -
--------- ---------
Net assets 1,015,104 777,902
--------- ---------
Capital and reserves
Called up share capital 1,680,498 1,187,812
Share premium account 3,004,812 2,939,276
Profit and loss account (3,670,206) (3,349,186)
--------- ---------
Shareholders' funds -
equity interests 1,015,104 777,902
--------- ---------
The financial statements were approved by the Board on 29 June 2005
CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2004
Year Ended Year Ended
31 December 31 December
2004 2003
Notes # # # #
Net cash outflow from
operating activities (326,367) (320,792)
Returns on investments
and servicing of finance
Interest received 20,095 5,989
Interest paid (3,220) -
--------- ---------
Net cash inflow for
returns on investments
and servicing of
finance 16,875 5,989
Capital expenditure
and financial investment
Payments to acquire
tangible assets (3,895) 91
Payments to acquire
investments (623,828) (19,906)
Advance of loan to
investments - (1,450)
--------- ---------
Net cash outflow for
capital expenditure
and financial
investment (627,723) (21,265)
--------- ---------
Net cash outflow
before management
of liquid resources
and financing (937,215) (336,068)
Financing
Issue of share capital 539,194 562,269
Cash acquired with
investments 475,861 -
--------- ---------
Increase/(decrease)
in cash in the year 77,840 226,201
--------- ---------
NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2004
1 Reconciliation of operating loss to net cash outflow from operating
activities
2004 2003
# #
Operating Loss (339,254) (367,355)
Depreciation of tangible assets 11,948 1,107
Amortisation of website - 3,664
Shares issued in lieu of consultancy fees 19,028 -
(Increase)/decrease in debtors 14,150 (41,577)
Increase/(decrease) in creditors within one year (72,402) (1,050)
Amortisation of goodwill 40,163 10,179
Provision for investment - 74,240
------- --------
Net cash outflow from operating activities (326,367) (320,792)
------- --------
2 Analysis of net funds
1 January Cash Flow 31 December
2004 2004
# # #
Net cash:
Cash at bank and in hand 500,966 77,840 578,806
------- ------ -------
Net funds 500,966 77,840 578,806
------- ------ -------
3 Reconciliation of net cash flow to movement in net funds
2004 2003
# #
Increase/(decrease) in cash in the year 77,840 226,201
------- --------
Movement in net funds in the year 77,840 226,201
Opening net funds 500,966 274,765
------- --------
Closing net funds 578,806 500,966
------- --------
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2004
1 Earnings per share
2004 2003
Loss before taxation 322,379 361,366
Weighted average number of shares in issue 146,530,824 75,382,106
Basic loss per share (pence) 0.220 0.479
FRS 14 requires presentation of diluted EPS when a company could be called upon
to issue shares that would decrease net profit or increase net loss per share.
As the group was loss making the diluted loss per share has not been disclosed,
since it seems inappropriate to assume that option holders would exercise their
rights in this way.
2 Net asset value per share
The net asset value per share and the net asset value attributable to ordinary
shareholders were as follows:
Net Asset Value per share Net Asset Value Attributable
Ordinary shares 31 December 31 December 31 December 31 December
(Basic) 2004 2003 2004 2003
0.60p 0.65p 1,015,104 777,902
------- ------ --------- --------
Basic net asset value per ordinary share is based on net assets at the year-end
and on 168,049,821 ordinary shares, being the number of ordinary shares in issue
at the year-end.
3. Basis of Preparation
The financial information set out in this announcement does not constitute the
Company's statutory financial statements within the meaning of section 240 of
the Companies Act 1985, for the years ended 31 December 2004 or 31 December
2003. The statutory financial statements for the year ended 31 December 2004
will be delivered to the Registrar of Companies following the Company's Annual
General Meeting. The results for the year ended 31 December 2003 have been
extracted from the full accounts for that year which have been delivered to the
Registrar of Companies on which the auditors have given an unqualified report
and which do not contain a statement under sections 237(2) or (3) of the
Companies Act 1985.
This announcement is prepared on the basis of the accounting policies as stated
in the previous year's financial statements.
4. Availability of Accounts
The audited accounts of the Company from which this announcement has been
extracted are being posted today to shareholders and copies are available from
the Company's registered office 7th Floor Aldermary House, 15 Queen Street,
London, EC4N 1TX
This information is provided by RNS
The company news service from the London Stock Exchange
END
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