RNS Number:1230D
QuikTrak Networks PLC
20 September 2004
QuikTrak Networks Plc
Interim Results
For the six month period ended 30 June 2004
The first six months of this financial year have presented the Company with some
major challenges.
Following the commercialisation of the M25 Network in late 2003, the Company
found that the market demand for a network limited to within the M25 was
incompatible with the operating costs being incurred, in particular the level of
spectrum fees being paid, which were for a national UK telecommunications
licence. Given the intense competition in the sector and the variety of
technologies on offer, it is now clear that a fundamental component of a
successful business plan is the ability to offer UK national coverage. The
establishment of such a network for QuikTrak would require a significant amount
of capital and we have to date not been successful in securing these funds,
despite sustained efforts.
Following a review of the costs incurred in operating the M25 Network, the Board
resolved it was not in shareholders' interests to continue to do so. As a
result, the Company's wholly-owned subsidiary, QuikTrak Telecommunications (UK)
Ltd (QTT), was placed into administration on 23 August 2004. The ability of
QuikTrak Networks plc to pursue its broader objectives is not impacted by this
decision.
During the six month period, the Company generated revenue of #157,002 (2003 :
#26,025). The loss for the period was #2,589,940, which includes writing off
the value of the net assets in QTT to #nil (2003 : loss of #1,471,848).
Included in the consolidated balance sheet at 30 June 2004 are assets of QTT
amounting to #1,142,642, offset by liabilities of QTT of the same amount.
The Company has refocused its operations in order to enable it to exploit the
Intellectual Property Rights of the technology and its unique software in
Europe, the Middle East and the countries of the former USSR through network
sales and licensing arrangements. In order to be able to demonstrate the
technology, the Company has negotiated the right to use a QuikTrak network
currently operating in Australia, at a substantially lower cost than the
operating costs of the M25 network.
In July 2004, the Company raised new equity of #800,202 (net of costs) to
finance this revised strategy.
Progress continues to be made in selling a licence agreement to a prospective
operator in the United Arab Emirates. This is the first example of QuikTrak
utilising the Intellectual Property ownership of its system and is intended to
act as a blueprint for all future licensing deals in Europe, the Middle East and
the countries of the former USSR. Licensing deals are expected to provide a
revenue stream through consultancy fees for preliminary investigations,
technical planning, acquisition of base-stations and software, as well as
through monthly technology, licence and technical support fees per base-station
and transponder deployed.
QuikTrak's secure, accurate and reliable tracking technology has been well
received by the market for a wide range of applications and I remain confident
that with our new approach based on licensing and partnerships we have a solid
base for re-building shareholder value.
Chris Kyriakou
Chairman
QuikTrak Networks plc
For further information contact:
Annie Richards QuikTrak Networks Plc Tel: 0870 010 6044
Hugh Oram Nabarro Wells & Co Ltd Tel: 020 7710 7400
QuikTrak Networks plc
Unaudited Consolidated Profit and Loss Account
for the six months ended 30 June 2004
6 months 18 months 6 months
30 June 31 December 30 June
2004 2003 2003
# # #
Revenue (Discontinued operations) 157,002 49,732 26,025
Cost of sales (44,735) (24,308) (10,261)
_______ ______ ______
Gross margin 112,267 25,424 15,764
Expenditure
Sales and administration overhead (972,846) (2,913,620) (586,451)
Radiocommunication licence fees (236,732) (191,640) (945)
Technology support fee (265,000) (572,850) (304,835)
_______ _______ _______
Loss before depreciation and amortisation (1,362,311) (3,652,686) (876,467)
Depreciation of plant and equipment (150,527) (197,366) (41,189)
Amortisation of goodwill (171,555) (496,298) (153,191)
________ ________ ________
Loss before exceptional items (1,684,393) (4,346,350) (1,070,847)
Exceptional item - Note 1 (908,894) (2,619,951) (401,001)
________ ________ ________
(2,593,287) (6,966,301) (1,471,848)
Bank interest received 3,347 - -
________ ________ ________
Loss before taxation
Continuing operations (314,646) (1,105,669) (524,001)
Discontinued operations (2,275,294) (5,860,632) (947,847)
________ ________ ________
(2,589,940) (6,966,301) (1,471,848)
Taxation - - -
________ ________ ________
Loss after taxation (2,589,940) (6,966,301) (1,471,848)
Loss per share (pence) (4.3) (14.7) (3.0)
Weighted average loss per share (pence) (4.4) (16.1) (3.5)
The Company has no gains or losses other than the results for the period set out
above.
The Company has taken advantage of section 230 of the Companies Act 1985 not to
publish its own Profit and Loss Account.
QuikTrak Networks plc
Unaudited Reconciliation of Movement in Shareholders' funds
for the six months ended 30 June 2004
6 months 18 months 6 months
30 June 31 December 30 June
2004 2003 2003
# # #
Loss for the financial period (2,589,940) (6,966,301) (1,471,848)
New equity from capital subscribed 125,800 471,397 34,618
Premium on new share capital subscribed 1,386,200 2,471,916 6,435,250
Premium on preference shares - subsidiary - 5,195,057 -
________ ________ ________
Net addition to funds (1,077,940) 1,172,069 4,998,020
Opening shareholders' funds 1,172,069 - -
________ ________ ________
Closing shareholders' funds 94,129 1,172,069 4,998,020
________ ________ ________
QuikTrak Networks plc
Unaudited Consolidated Balance Sheet
as at 30 June 2004
30 June 31 December 30 June
2004 2003 2003
# # #
Fixed assets
Goodwill 679,932 1,417,486 3,087,988
Tangible assets 299,981 628,840 886,281
Current assets
Trade debtors - 4,136 -
Other debtors 12,325 23,260 44,330
Prepayments 53,012 34,932 44,277
Inventory - - 93,666
Letter of credit deposit - - 150,215
Investments 150,000 - -
Cash at bank 213,872 114,556 581,536
________ ________ ________
429,209 176,884 914,024
Creditors:
Amounts falling due within one year (1,314,993) (1,051,141) (689,802)
________ ________ ________
Net current (liabilities)/assets (885,784) (874,257) 224,222
________ ________ ________
Total assets less current liabilities 94,129 1,172,069 4,198,491
________ ________ ________
Net assets 94,129 1,172,069 4,198,491
________ ________ ________
Capital and reserves
Called up share capital 597,197 471,397 442,626
Share premium 9,053,173 7,666,973 6,690,492
Accumulated loss (9,556,241) (6,966,301) (2,934,627)
________ ________ ________
Shareholders' funds 94,129 1,172,069 4,198,491
QuikTrak Networks plc
Unaudited Consolidated Cash Flow
for the six months ended 30 June 2004
6 months 18 months 6 months
30 June 31 December 30 June
2004 2003 2003
# # #
Net cash outflow from operating activities (1,194,363) (3,539,784) (1,258,211)
Interest received 3,347 - -
Payments to acquire tangible fixed assets (71,668) (1,071,113) (642,551)
Purchase of investment (150,000) (500,000) -
Sale of investment - 98,999 -
Net cash acquired with subsidiaries - 29,604 13,699
________ ________ ________
Cash outflow before financing (1,412,684) (4,982,294) (1,887,063)
Financing
Issue of equity share capital 1,512,000 2,943,313 1,274,811
Loans raised from QuikTrak Networks Ltd
(and subsequently converted into non-equity
capital) - 2,153,537 464,884
Extended credit provided by suppliers (net of
repayments) - - 184,229
________ _______ _______
Net cash flow 99,316 114,556 36,861
Cash at beginning of period 114,556 - 544,675
________ _______ _______
Cash at end of period 213,872 114,556 581,536
________ _______ _______
QuikTrak Networks plc
Notes to the Interim Accounts
for the six months ended 30 June 2004
Note 1
Exceptional items 6 months 18 months 6 months
30 June 31 December 30 June
2004 2003 2003
# # #
Impairment write down:
Goodwill (565,999) (1,498,950) -
Network assets (250,000) (250,000) -
Stock (92,895) (470,000) -
Loss on sale of investments - (401,001) (401,001)
______ ________ _______
(908,894) (2,619,951) (401,001)
Continued operations - (401,001) (401,001)
Discontinued operations (908,894) (2,218,950) -
_______ ________ _______
(908,894) (2,619,951) (401,001)
Note 2
Post balance sheet events
In July 2004, the company issued a further 56,430,004 Ordinary 1p shares at a
price of 1.5p per share. The total proceeds of this issue less costs of #46,248
amounted to #800,202.
On 23 August 2004, QuikTrak Telecommunications (UK) Limited, a 100% owned
subsidiary of the Company was placed into administration.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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