TIDMVTS
RNS Number : 4104G
Vantis PLC
01 February 2010
+---------------------------------------------------------+---------------------------------------------------------+
| For Immediate Release | 29 January 2010 |
+---------------------------------------------------------+---------------------------------------------------------+
("Vantis", the "Company" or the "Group")
Interim results for the six months ended 31 October 2009
Vantis, the AIM listed accountancy and professional services group, today
announces its interim results for the six months ended 31 October 2009.
Highlights
· The six months ended 31 October 2009 was a challenging period with Group
results dominated by exceptional charges primarily addressing impairment issues;
· Business Recovery Services (BRS) division continued to grow with
pre-exceptional revenue up 43% to GBP17.4m (2008: GBP12.2m);
· Business Advisory & Tax (BATS) division, incorporating independent
financial advice, declined with pre-exceptional revenue down 17% to GBP29.6m
(2008: GBP35.7m);
· Operating profit on continuing activities before amortisation, exceptional
items, interest and tax was GBP3.6m (2008: GBP7.2m restated);
· Exceptional charges of GBP11.7m include non-cash impairment of current and
intangible assets amounting to GBP9.4m;
· The Group has started a cost reduction programme to improve future
operating performance. Recruitment is ongoing into BRS to strengthen this
growing division;
· Decisions from UK Court of Appeal and from the financial regulator in
Switzerland awaited regarding control of Stanford International Bank assets and
therefore recovery of BRS' time costs;
· Adjusted basic earnings per share, before amortisation and exceptional
items, amounted to 1.5p profit per share (2008: 7.3p restated). Basic earnings
per share amounted to 15.3p loss (2008: 6.1p profit restated);
· Amended debt facility agreed on 2 November 2009 to increase working
capital. Net debt, excluding finance leases & loan stock, at 31 October 2009
amounted to GBP40.4m;
· Stephen Smith appointed interim Finance Director in November 2009 and Mike
Wheeler appointed Non-executive Chairman in December 2009. Trevor Applin, Paul
Ashton and Bob Thornton stepped down from the plc board as Executive Directors
to the operating board. Paul Gourmand and Graham Cole retired as Non-executive
Directors.
Chairman, Mike Wheeler, said:
"The Group has initiated cost reduction and working capital improvement
programmes, which are expected to deliver improved performance in the new
financial year commencing 1 May 2010. We expect further growth in BRS but the
performance of BATS will be constrained until the UK economy improves."
For further information:
+-------------------------------------------------+-----------------------------------------------------------------+
| Vantis plc | +44 20 7417 0417 |
+-------------------------------------------------+-----------------------------------------------------------------+
| Paul Jackson, Chief Executive | |
+-------------------------------------------------+-----------------------------------------------------------------+
| Stephen Smith, Finance Director | |
+-------------------------------------------------+-----------------------------------------------------------------+
| | |
+-------------------------------------------------+-----------------------------------------------------------------+
| Investec Investment Banking | +44 20 7597 5970 |
+-------------------------------------------------+-----------------------------------------------------------------+
| David Currie, Martin Smith | |
+-------------------------------------------------+-----------------------------------------------------------------+
| | |
+-------------------------------------------------+-----------------------------------------------------------------+
| Buchanan Communications | +44 20 7466 5000 |
+-------------------------------------------------+-----------------------------------------------------------------+
| Richard Darby, James Strong, Chris McMahon | |
+-------------------------------------------------+-----------------------------------------------------------------+
Notes to Editors
Vantis plc is the AIM listed leading UK accounting, tax and business recovery
and advisory group, focused on helping owner-managed businesses and high net
worth individuals successfully achieve their personal and business aspirations.
Services are provided locally and nationwide by experienced professionals and
specialist industry teams who offer comprehensive sector knowledge and product
expertise. Vantis strives to provide all clients with successful, bespoke
solutions to help generate and preserve their wealth.
The Vantis group offers a range of specialist skills including Accounting,
Taxation, Business Advice, Corporate Finance, Asset Finance, Forensic Accounting
and Dispute Resolution, Business Recovery & Personal Insolvency Services,
Restructuring and Turnaround Services, Outsourcing, Management Consultancy,
Company Secretarial, Customs Duty Recovery and Advisory Services, Independent
Financial Advice, High Net Worth Services and Sports Advisory Services and
Solutions.
The Vantis group has approximately 1,000 staff operating from 16 locations
throughout England.
For more information about Vantis, please visit www.vantisplc.com
Chairman's Statement
This is my first statement since my appointment as Chairman in December. The six
months ended 31 October 2009 was a challenging period for the Group. Although
the Business Recovery Services division ("BRS") continued to grow, our Business
Advisory & Tax division ('"BATS") declined and the overall Group results are
dominated by exceptional charges primarily addressing balance sheet impairment
issues. As a result, the Group has started a cost reduction programme to improve
future operating profit performance.
Results
During the six months ended 31 October 2009, the Group's turnover before
exceptional items reduced by 2% to GBP47.0 million (2008: GBP47.9 million -
restated). Operating profit on continuing activities before amortisation,
exceptional items, interest and tax was GBP3.6 million (2008: GBP7.2 million -
restated), a decrease of GBP3.6 million. After exceptional costs and interest,
the loss before tax for the period was GBP10.7 million (2008: GBP4.6 million
profit - restated). Exceptional charges of GBP11.7 million include a GBP9.4
million charge for impairment of current and intangible assets after a review
following the board changes announced in November, together with GBP1.7 million
of costs arising from operational and financial restructuring.
The first half operating margin, before exceptional costs fell to 8% due to
reduced revenue in BATS and higher costs in BRS and support functions. We
expect margins to remain under pressure until the benefits of the cost reduction
programme come through later in the second six months of this financial year and
during the financial year ending 30 April 2011. Adjusted basic earnings per
share on continuing operations excluding amortisation and exceptional costs
amounted to a profit of 1.5 pence (2008: 7.3 pence restated). Basic earnings per
share amounted to a loss of 15.3 pence (2008: 6.1 pence profit).
The Directors are not declaring an interim dividend.
Group development
During the first half, we have continued to recruit additional high calibre
staff to strengthen our expanding and profitable BRS division, with senior
appointments being made in London, Manchester and Birmingham. Driving
efficiency will be a key priority for the division in future.
Revenue growth in BRS was up 43% to GBP17.4 million, and we expect BRS
continuing to represent a greater proportion of Group revenue as the division
grows with an increasing list of larger assignments in the mid-corporate sector.
Revenue from BATS has declined by 17% to GBP29.6 million. Nevertheless the
division continues to focus on improving client quality which should help to
protect fee revenue as the UK economy comes out of recession.
Stanford International Bank ("SIB")
Significant resource has been committed to SIB during the period following the
appointment of Nigel Hamilton-Smith and Peter Wastell as joint receivers on 19
February 2009. They were appointed as joint liquidators on 15 April 2009. As a
result of a freezing order issued by a US Court, legal appeals by a US appointed
receiver and the delay in realisation of significant property assets, it was not
possible to receive payment of fees during the half year period.
In July 2009, the High Court in England & Wales found that the Centre of Main
Interest ("CoMI") for UK SIB assets should be in Antigua and Barbuda and that as
a consequence, these assets fall under the control of the joint liquidators.
The US appointed receiver appealed and a decision from the UK Court of Appeal is
awaited. Separately, a decision from the financial regulator in Switzerland is
also awaited on whether the joint liquidators or the US receiver should have
control of SIB assets located there.
The Group is confident that outstanding time costs will be recovered in due
course but the various legal actions mean that timing is uncertain.
In the meantime, BRS continues to verify and confirm investors' claims via the
SIB online claims management system.
The Board
On 17 December 2009, I was appointed as Non-Executive Chairman of the Group.
Formerly, I was a Global Managing Partner of Advisory Services at KPMG and have
provided strategic advice to a wide range of companies around the world. In
November we announced the appointment of Stephen Smith as an Executive Director
who assumes the Finance Director's responsibilities on an interim basis until a
new full time Finance Director is appointed. Trevor Applin, Paul Ashton and Bob
Thornton stepped down from the plc board as executive directors in December to
the operating board.
The restructuring of the board strengthens the Group's compliance with the
Combined Code on Corporate Governance.
I would like to take this opportunity of thanking Paul Gourmand and Graham Cole
for their longstanding support to the Group. Both retired as non executive
directors in December having been members of the Board since flotation in May
2002.
Finance
At 31 October 2009, net debt excluding finance leases and loan stock amounted to
GBP40.4 million (30 April 2009: GBP37.8 million). Net cash generated from
operations was GBP0.7 million positive (2008: GBP1.7 million negative) despite
the operating loss after exceptional items. The Group's cash balances reduced
in the six months to 31 October 2009 principally due to payments for deferred
consideration and a bank loan repayment.
On 2 November 2009, an amended debt facility was agreed with our existing
banking syndicate increasing the Group's working capital. On 29 January 2010
the banking facility was amended to remove a GBP3.25 million amortisation
payment in August 2010 and to incorporate more appropriate financial covenants.
Although the costs of the revised facility are substantially higher than
previously, we are pleased with the continuing support shown from our lending
banks.
Summary & Outlook
The Group has suffered from the impact of the recession on BATS and has also had
to cope with the increase in working capital caused by the growth in BRS; this
is expected to continue to affect the second half of the current financial year.
The Group has initiated cost reduction and working capital improvement
programmes which are expected to deliver improved performance in the new
financial year starting on 1 May 2010. We expect further growth in BRS but the
performance of BATS will be constrained until the UK economy improves.
Mike Wheeler
Chairman
29 January 2010
+---------------------------+--------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| Consolidated income statement for the six months ended 31 October 2009 |
| |
+----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| | 6 months ended 31 Oct | | 6 months ended 31 Oct | | Year ended 30 Apr 2009 |
| | 2009 | | 2008 | | |
+---------------------------+--------------------------------------------+----------+--------------------------------------------+----------+--------------------------------------------+
| | Unaudited | | Restated & unaudited | | Audited |
+---------------------------+--------------------------------------------+----------+--------------------------------------------+----------+--------------------------------------------+
| | Before | Amortisation | After | | Before | Amortisation | After | | Before | Amortisation | After |
| | amortisation | & | amortisation | | amortisation | & | amortisation | | amortisation | & | amortisation |
| | & | exceptional | & | | & | exceptional | & | | & | exceptional | & |
| | exceptional | items | exceptional | | exceptional | items | exceptional | | exceptional | items | exceptional |
| | items | | items | | items | | items | | items | | items |
+---------------------------+--------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | GBP'000 | GBP'000 | GBP'000 | | GBP'000 | GBP'000 | GBP'000 | | GBP'000 | GBP'000 | GBP'000 |
+---------------------------+--------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | | | | | | | | | | |
| From continuing operations: | | | | | | | | | | |
+------------------------------------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | 47,003 | (3,883) | 43,120 | | 47,924 | - | 47,924 | | 93,183 | (3,622) | 89,561 |
| Revenue | | | | | | | | | | | |
+---------------------------+--------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | (30,768) | (100) | (30,868) | | (28,432) | (356) | (28,788) | | (58,748) | (4,466) | (63,214) |
| Employee benefits | | | | | | | | | | | |
| expense | | | | | | | | | | | |
+---------------------------+--------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | (350) | (1,505) | (1,855) | | (362) | (103) | (465) | | (876) | (476) | (1,352) |
| | | | | | | | | | | | |
| Amortisation/depreciation | | | | | | | | | | | |
+---------------------------+--------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | (12,318) | (6,456) | (18,774) | | (11,895) | (391) | (12,286) | | (22,447) | (5,225) | (27,672) |
| Other operating | | | | | | | | | | | |
| charges | | | | | | | | | | | |
+---------------------------+--------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | 3,567 | (11,944) | (8,377) | | 7,235 | (850) | 6,385 | | 11,112 | (13,789) | (2,677) |
| Operating profit/(loss) | | | | | | | | | | | |
+---------------------------+--------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | 5 | - | 5 | | 22 | - | 22 | | 27 | - | 27 |
| Interest revenue | | | | | | | | | | | |
+---------------------------+--------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | (2,310) | - | (2,310) | | (1,857) | - | (1,857) | | (3,499) | (386) | (3,885) |
| Finance costs | | | | | | | | | | | |
+---------------------------+--------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | 1,262 | (11,944) | (10,682) | | 5,400 | (850) | 4,550 | | 7,640 | (14,175) | (6,535) |
| Profit/(loss) before | | | | | | | | | | | |
| tax | | | | | | | | | | | |
+---------------------------+--------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | (386) | 2,034 | 1,648 | | (1,555) | 245 | (1,310) | | (2,108) | 3,436 | 1,328 |
| Taxation | | | | | | | | | | | |
+---------------------------+--------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | 876 | (9,910) | (9,034) | | 3,845 | (605) | 3,240 | | 5,532 | (10,739) | (5,207) |
| Profit/(loss) after | | | | | | | | | | | |
| tax | | | | | | | | | | | |
+---------------------------+--------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | | | | | | | | | | | |
| | | | | | | | | | | | |
+---------------------------+--------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | | | | | | | | | |
| Profit/(loss) after tax-discontinued | - | | | | 24 | | | | (216) |
| operations (note 2) | | | | | | | | | |
+---------------------------------------------------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | | | | | | | | | | | |
| (Loss)/profit for the | | | (9,034) | | | | 3,264 | | | | (5,423) |
| period | | | | | | | | | | | |
+---------------------------+ + +--------------+----------+ + +--------------+----------+ + +--------------+
| | | | | | | | | | | | |
| | | | | | | | | | | | |
+---------------------------+--------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | | | | | | | | | |
| Attributable to equity holders of the | (9,034) | | | | 3,264 | | | | (5,422) |
| parent | | | | | | | | | |
+---------------------------------------------------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | | | | | | | | | | |
| Attributable to minority | | - | | | | - | | | | (1) |
| interests | | | | | | | | | | |
+------------------------------------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | | | | | | | | |
| Notes: | | | | | | | | |
| For details of Amortisation & exceptional items see | | | | | | | | |
| note 3 | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
+------------------------------------------------------------------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | | | | | | | | | | | |
| Earnings per share: | | | | | | | | | | | |
+---------------------------+--------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | | | | | | | | | | | |
| From continuing | | | | | | | | | | | |
| operations: | | | | | | | | | | | |
+---------------------------+--------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | | | | | | | | | | | |
| Basic | 1.5p | | (15.3)p | | 7.3p | | 6.1p | | 10.1p | | (9.5)p |
+---------------------------+--------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | | | | | | | | | | | |
| Diluted | 1.5p | | (15.3)p | | 7.2p | | 6.0p | | 9.8p | | (9.5)p |
+---------------------------+--------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | | | | | | | | | | | |
| From all operations: | | | | | | | | | | | |
+---------------------------+--------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | | | | | | | | | | | |
| Basic | | | (15.3)p | | | | 6.2p | | | | (9.9)p |
+---------------------------+--------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | | | | | | | | | | | |
| Diluted | | | (15.3)p | | | | 6.1p | | | | (9.9)p |
+---------------------------+--------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
| | | | | | | | | | | | |
| | | | | | | | | | | | |
+---------------------------+--------------+--------------+--------------+----------+--------------+--------------+--------------+----------+--------------+--------------+--------------+
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Consolidated balance sheet at 31 October 2009 | | | |
+-------------------------------------------------------------------------------------+-----------+----------+----------+
| | | | As at 31 | | As at 31 | | As at 30 |
| | | | Oct 2009 | | Oct 2008 | | Apr 2009 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | | | Restated | | |
| | | | Unaudited | | Unaudited | | Audited |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | | | | | |
| | |Notes | GBP'000 | | GBP'000 | | GBP'000 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Assets | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | | | | | |
| Non current assets | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Goodwill | | 6 | 50,486 | | 47,595 | | 50,397 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Other intangible assets | | 6 | 2,614 | | 3,121 | | 3,984 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Property, plant and equipment | | | 4,420 | | 3,930 | | 4,182 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Financial assets | | | 13 | | 13 | | 13 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Deferred tax assets | | | 3,991 | | 1,285 | | 2,090 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | | | | | |
| | | | 61,524 | | 55,944 | | 60,666 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | | | | | |
| Current assets | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Inventories | | | 103 | | 103 | | 103 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Trade and other receivables | | | 50,371 | | 60,338 | | 56,786 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Derivative financial instruments | | | 78 | | 78 | | 31 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Current income tax | | | 1,250 | | - | | 1,320 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Cash and short deposits | | | 1,301 | | 7 | | 4,625 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | | | | | |
| | | | 53,103 | | 60,526 | | 62,865 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | | | | | |
| | | | | | | | |
| Total assets | | | 114,627 | | 116,470 | | 123,531 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | | | | | |
| | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | | | | | |
| Current liabilities | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Trade and other payables | | | (29,100) | | (22,746) | | (27,020) |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Other financial liabilities | | | (7,822) | | (8,814) | | (8,807) |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Current income tax | | | - | | (968) | | (9) |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | | | | | |
| | | | (36,922) | | (32,528) | | (35,836) |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | | | | | |
| Non current liabilities | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Financial liabilities | | | (41,393) | | (32,837) | | (43,541) |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Deferred tax liabilities | | | (1,644) | | (1,126) | | (1,389) |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Provisions | | | (341) | | (245) | | (245) |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | | | | | |
| | | | (43,378) | | (34,208) | | (45,175) |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | | | | | |
| Total liabilities | | | | | | | |
| | | | (80,300) | | (66,736) | | (81,011) |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | | | | | |
| | | | | | | | |
| Net assets | | | 34,327 | | 49,734 | | 42,520 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | | | | | |
| Equity | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Share capital | | | 5,881 | | 5,295 | | 5,793 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Shares to be issued | | | - | | 1,000 | | - |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Share premium account | | | 34,020 | | 30,391 | | 33,448 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Treasury shares | | | (40) | | - | | (30) |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Other reserves | | | 847 | | 1,139 | | 656 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Retained earnings | | | (6,435) | | 11,854 | | 2,599 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Equity attributable to equity holders of the | | | 34,273 | | 49,679 | | 42,466 |
| parent | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Minority Interest | | | 54 | | 55 | | 54 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | 34,327 | | 49,734 | | 42,520 |
| Total equity | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Consolidated cash flow statement for the six months ended 31 October 2009 | | | |
+-------------------------------------------------------------------------------------+-----------+----------+----------+
| | | | 6 months | | 6 months | | Year |
| | | | ended | | ended | | ended |
| | | | 31 Oct | | 31 Oct | | 30 Apr |
| | | | 2009 | | 2008 | | 2009 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | | | Restated | | |
| | | | Unaudited | | Unaudited | | Audited |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | | | | | |
| | | | GBP'000 | | GBP'000 | | GBP'000 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | | | | | |
| (Loss)/profit before tax from continuing | | | (10,682) | | 4,550 | | (6,535) |
| operations | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Profit/(loss) before tax | | | - | | 34 | | (207) |
| operations-discontinued operations | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| (Loss)/profit before tax | | | (10,682) | | 4,584 | | (6,742) |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Adjustments to reconcile profit before tax | | | | | | | |
| to net cashflows | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Non cash: | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Depreciation and impairment of property | | | 350 | | 362 | | 876 |
| and | | | | | | | |
| equipment | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Amortisation and impairment of | | | 1,505 | | 103 | | 476 |
| intangibles | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Share based payments expense | | | 69 | | 141 | | 1,016 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Gain on disposal of business | | | - | | - | | (7) |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Adjustment to disposals made in prior | | | - | | - | | 543 |
| periods | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Changes in fair value of derivative | | | - | | 7 | | - |
| financial instruments | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Interest income | | | (5) | | (22) | | (27) |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Interest expense | | | 2,310 | | 1,859 | | 3,885 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Movements in provisions | | | 96 | | (78) | | (78) |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Working capital adjustments: | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Decrease/(increase) in trade and other | | | 6,399 | | (6,981) | | (3,978) |
| receivables | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Increase in trade and other payables | | | 2,116 | | 1,532 | | 7,279 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Cash generated from operations | | | 2,158 | | 1,507 | | 3,243 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Finance costs paid | | | (1,495) | | (1,493) | | (3,040) |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Finance income received | | | 5 | | 22 | | 27 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Taxation paid | | | - | | (1,708) | | (1,708) |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Net cash generated/(used) in operating | | | 668 | | (1,672) | | (1,478) |
| activities | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Investing activities: | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Purchase of property plant and equipment | | | (303) | | (454) | | (990) |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Purchase of other intangible assets | | | (135) | | (2,293) | | (1,850) |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Acquisition of subsidiary undertakings including deferred | (1,672) | | (543) | | (1,997) |
| consideration | | | | | |
+-------------------------------------------------------------+------------+----------+-----------+----------+----------+
| Disposal of subsidiary undertakings | | | - | | - | | (1) |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Net cash flows used in investing activities | | | (2,110) | | (3,290) | | (4,838) |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Financing activities: | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Proceeds from issue of share capital | | | - | | 1,000 | | 2,413 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Proceeds from issue of loan instrument | | | - | | - | | 284 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Proceeds from new bank loans | | | - | | 2,000 | | 10,592 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Repayment of bank loans | | | (1,500) | | (1,600) | | (3,500) |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Payment of finance lease liabilities | | | (347) | | (364) | | (684) |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Dividend paid to equity holders of the | | | - | | - | | (1,362) |
| parent | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Net cash flows used in financing activities | | | (1,847) | | 1,036 | | 7,743 |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Net (decrease)/increase in cash and cash | | | (3,289) | | (3,926) | | 1,427 |
| equivalents | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Cash and cash equivalents at beginning of | | | 4,590 | | 3,163 | | 3,163 |
| period | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
| Cash and cash equivalents at end of period | | | 1,301 | | (763) | | 4,590 |
| (note 7) | | | | | | | |
+----------------------------------------------+------+-------+------------+----------+-----------+----------+----------+
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| Consolidated statement of changes in equity for the six months ended 31 October 2009 |
+--------------------------------------------------------------------------------------------------------------------------+
| | Attributable to equity holders of the parent | Minority | Total |
| | | interest | equity |
+----------------------------+------------------------------------------------------------------------+ + +
| | Share | | | Shares | Share | Treasury | Others | Retained | Total |
| | | | | to be | premium | | | | |
| | capital | | | issued | | shares | reserves | earnings | |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| At 30 April 2008 | 5,243 | - | 29,969 | - | 1,391 | 9,383 | 45,986 | 55 | 46,041 |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| Deferred tax on | | | | | | | | | |
| share-based payments | - | - | - | - | (350) | - | (350) | - | (350) |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
| Fair value movements on | | | | | | - | | | |
| hedging instruments net of | - | - | - | - | 98 | | 98 | - | 98 |
| tax | | | | | | | | | |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
| Total recognised income | | | | | | | | | |
| and expense for the period | - | - | - | - | (252) | - | (252) | - | (252) |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
| Profit for the period | - | - | - | - | - | 3,264 | 3,264 | - | 3,264 |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
| Dividends | - | - | - | - | - | (793) | (793) | - | (793) |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
| Shares to be issued | - | 1,000 | - | - | - | - | 1,000 | - | 1,000 |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
| Issue of share capital | 52 | - | 422 | - | - | - | 474 | - | 474 |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
| | 52 | 1,000 | 422 | - | (252) | 2,471 | 3,693 | 55 | 3,693 |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| At 31 October 2008 | 5,295 | 1,000 | 30,391 | - | 1,139 | 11,854 | 49,679 | 55 | 49,734 |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
| Deferred tax on | | | | | | | | | |
| share-based payments | - | - | - | - | 300 | - | 300 | -x | 300 |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
| Fair value movements on | | | | | | | | | |
| hedging instruments net of | - | - | - | - | (952) | - | (952) | - | (952) |
| tax | | | | | | | | | |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
| Total recognised income | | | | | | | | | |
| and expense for the period | - | - | - | - | (652) | - | (652) | - | (652) |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
| Loss for the period | - | - | - | - | - | (8,686) | (8,686) | (1) | (8,687) |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
| Share based remuneration | - | - | - | - | 155 | - | 155 | - | 155 |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
| Dividends | - | - | - | - | - | (569) | (569) | - | (569) |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
| Issue of financial | - | - | - | - | 14 | - | 14 | - | 14 |
| instrument | | | | | | | | | |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
| Shares to be issued | - | (1,000) | - | - | - | - | (1,000) | - | (1,000) |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
| Issue of share capital | 498 | - | 3,057 | (30) | - | - | 3,525 | - | 3,525 |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
| | 498 | (1,000) | 3,057 | (30) | (483) | (9,255) | (7,213) | (1) | (7,214) |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| At 30 April 2009 | 5,793 | - | 33,448 | (30) | 656 | 2,599 | 42,466 | 54 | 42,520 |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
| Fair value movements on | | | | | | | | | |
| hedging instruments net of | - | - | - | - | 163 | - | 163 | - | 163 |
| tax | | | | | | | | | |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
| Total recognised income | | | | | | | | | |
| and expense for the period | - | - | - | - | 163 | - | 163 | - | 163 |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
| Loss for the period | - | - | - | - | - | (9,034) | (9,034) | - | (9,034) |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
| Share based remuneration | - | - | - | - | 28 | - | 28 | - | 28 |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
| Issue of share capital | 88 | - | 572 | (10) | - | - | 650 | - | 650 |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
| | 88 | - | 572 | (10) | 191 | (9,034) | (8,193) | - | (8,193) |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| | | | | | | | | | |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
| As 31 October 2009 - | | | | | | | | | |
| unaudited | 5,881 | - | 34,020 | (40) | 847 | (6,435) | 34,273 | 54 | 34,327 |
+----------------------------+---------+----------+---------+---------+---------+----------+----------+----------+---------+
Notes on the unaudited interim financial information
1.Basis of preparation
The consolidated financial information has been prepared in accordance with
accounting policies which will be adopted in presenting the full year annual
report and accounts and is consistent with prior year filed financial
statements.
The interim financial information is unaudited and does not constitute statutory
financial statements within the meaning of section 434 of the Companies Act
2006.
The Group's statutory consolidated financial statements for the year ended 30
April 2009 were presented under IFRS. The report of the auditors on those
financial statements was unqualified and did not contain a statement under
section 498 (2) or (3) of the Companies Act 2006.
As described in the Chairman's Statement, a loss before tax of GBP10.7 million
has been recorded for the 6 months to 31 October 2009 as a result of a GBP11.9
million charge for amortisation and exceptional items which includes various non
recurring costs as well as asset impairment charges which are further described
in note 3. These charges arose following a review undertaken after the changes
to the board of directors announced on 20 November 2009. In addition the Group's
underlying profitability fell compared to the equivalent period in the prior
year due to higher costs. As a result of the charges and increased costs,
together with the slower than expected start to the second half of the financial
year, the Group is experiencing a weaker liquidity position than anticipated and
revenue growth continues to be difficult
The board is undertaking a thorough review of the Groups cost base and expects
to see a significant reduction in costs for the year ending 30 April 2011. The
Group is also undertaking a number of other measures to improve the cash
position including a reduction in working capital. The forecasts include
significant amounts carried in the interim balance sheet as due to the Group in
respect of the insolvency of Stanford International Bank in Antigua however
their timing will depend on the outcome of court decisions in both Antigua and
Europe.
After taking account of the Stanford receipts and the initiatives to reduce
costs and improve cash, the Group's forecasts show that the Group should be able
to operate within its current banking facilities and covenants but there are
material uncertainties in achieving this which may in turn cast significant
doubt on the group's ability to continue as a going concern. The financial
information does not reflect the affect of any changes which might be required
if the company were not able to continue as a going concern.
The group's banking facilities expire on 31 January 2011, the directors intend
to seek an extension of the expiry date at the appropriate time.
Taking all of these matters into consideration the directors have a reasonable
expectation that the Group has adequate resources to continue in operational
existence for the foreseeable future and consequently these accounts have been
prepared on a going concern basis.
2. Discontinued operations
The Group disposed of its interest in Vantis Sports Solutions Limited
in April 2009. The results for the period to disposal are provided below:
+-------------------------------------------+-------------+--+-------------+--+-------------+
| | | | 6 months | | Year ended |
| | | | ended 31 | | 30 Apr 2009 |
| | | | Oct 2008 | | |
| | | | Restated | | Audited |
| | | | Unaudited | | |
+-------------------------------------------+-------------+--+-------------+--+-------------+
| | | | GBP'000 | | GBP'000 |
+-------------------------------------------+-------------+--+-------------+--+-------------+
| Revenue | | | 330 | | 1,153 |
+-------------------------------------------+-------------+--+-------------+--+-------------+
| Expenses | | | (294) | | (1,365) |
+-------------------------------------------+-------------+--+-------------+--+-------------+
| Operating profit/(loss) | | | 36 | | (212) |
+-------------------------------------------+-------------+--+-------------+--+-------------+
| Finance costs | | | (2) | | (2) |
+-------------------------------------------+-------------+--+-------------+--+-------------+
| Profit/(loss) before tax from | | | 34 | | (214) |
| discontinued operations | | | | | |
+-------------------------------------------+-------------+--+-------------+--+-------------+
| Gain on disposal | | | - | | 7 |
+-------------------------------------------+-------------+--+-------------+--+-------------+
| Tax (charge) | | | (10) | | (9) |
+-------------------------------------------+-------------+--+-------------+--+-------------+
| Profit/(loss) for the period from | | | | | |
| discontinued operations | | | 24 | | (216) |
+-------------------------------------------+-------------+--+-------------+--+-------------+
3. Amortisation and exceptional items
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | 6 months | | 6 months | | Year ended |
| | ended 31 | | ended 31 | | 30 Apr 2009 |
| | Oct 2009 | | Oct 2008 | | |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | | | | | |
| | | | Restated | | |
| | Unaudited | | Unaudited | | Audited |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | | | | | |
| | GBP'000 | | GBP'000 | | GBP'000 |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | | | | | |
| Current and intangible asset impairments | 9,420 | | - | | - |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| Costs of previous acquisitions | 485 | | - | | - |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| Costs of provisions associated with the | - | | - | | 6,561 |
| investments | | | | | |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| Transactions with previous partners of VTL | - | | - | | 2,780 |
| Strategies LLP | | | | | |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| Operational restructuring and redundancies | 684 | | 747 | | 3,429 |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| Cost of disposals made in prior periods | - | | - | | 543 |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| Financial restructuring | 1,159 | | - | | 386 |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| Total exceptional items | 11,748 | | 747 | | 13,699 |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | | | | | |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| Amortisation | 196 | | 103 | | 476 |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| Amortisation and exceptional items | 11,944 | | 850 | | 14,175 |
+----------------------------------------------+-------------+--+-------------+--+---------------+
Exceptional items of GBP11.7 million were recognised in the period, the majority
of which (GBP9.4 million) related to current and intangible asset impairments
arising from a review undertaken after changes to the board of directors
announced in November 2009. Other exceptional cash costs totalling GBP2.3
million consist of organisational restructuring and redundancies, costs of a
previous acquisition, and the professional fees incurred prior to renegotiating
changes to the group's banking agreements.
Exceptional items for the 6 months ended 31 October 2008 and year ended 30 April
2009 relate to transactions and provisions associated with investment products
and the reorganisation and rationalisation of the business into two divisions;
Business Advisory & Tax and Business Recovery Services. Full details of the
nature of transactions and provisions relating to investment products were
provided in the financial statements for the year ended 30 April 2009.
4.Earnings per share
The following reflects the income and share data used in the basic and
diluted earnings per share computations.
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | 6 months | | 6 months | | Year ended |
| | ended 31 | | ended 31 | | 30 Apr 2009 |
| | Oct 2009 | | Oct 2008 | | |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | | | | | |
| | | | Restated | | |
| | Unaudited | | Unaudited | | Audited |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | | | | | |
| | GBP'000 | | GBP'000 | | GBP'000 |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | | | | | |
| (Loss)/profit for the period attributable to | | | | | |
| equity holders of the parent | (9,034) | | 3,264 | | (5,422) |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | | | | | |
| (Loss)/profit for the period attributable to | | | | | |
| equity holders of the parent on continuing | (9,034) | | 3,240 | | (5,206) |
| activities | | | | | |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | | | | | |
| Profit for the period attributable to equity | | | | | |
| holders of the parent on continuing | | | | | |
| activities before exceptional costs and | 876 | | 3,845 | | 5,533 |
| amortisation | | | | | |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | | | | | |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | | | | | |
| Weighted average number of shares in issue: | '000 | | '000 | | '000 |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | | | | | |
| Basic | 58,954 | | 52,701 | | 54,857 |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | | | | | |
| Fully diluted | 59,159 | | 53,619 | | 56,287 |
+----------------------------------------------+-------------+--+-------------+--+---------------+
5.Dividends
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | 6 months | | 6 months | | Year ended |
| | ended 31 | | ended 31 | | 30 Apr 2009 |
| | Oct 2009 | | Oct 2008 | | |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | | | | | |
| | Unaudited | | Unaudited | | Audited |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | | | | | |
| | GBP'000 | | GBP'000 | | GBP'000 |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | | | | | |
| Final | - | | 793 | | 793 |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | | | | | |
| Interim | - | | - | | 569 |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | | | | | |
| | - | | 793 | | 1,362 |
+----------------------------------------------+-------------+--+-------------+--+---------------+
6.Intangible assets
+--------------------------+----------+----------+----------+---------------+----------+-------------+----------+----------+----------+----------+
| | | Goodwill | | Customer | | Product | | Computer | | Total |
| | | | | relationships | | development | | software | | |
+--------------------------+----------+----------+----------+---------------+----------+-------------+----------+----------+----------+----------+
| | | | | | | | | | | |
| | | GBP'000 | | GBP'000 | | GBP'000 | | GBP'000 | | GBP'000 |
+--------------------------+----------+----------+----------+---------------+----------+-------------+----------+----------+----------+----------+
| | | | | | | | | | | |
| Costs: | | | | | | | | | | |
+--------------------------+----------+----------+----------+---------------+----------+-------------+----------+----------+----------+----------+
| | | | | | | | | | | |
| At 1 May 2008 | | 50,645 | | 757 | | 1,289 | | 721 | | 53,412 |
+--------------------------+----------+----------+----------+---------------+----------+-------------+----------+----------+----------+----------+
| | | | | | | | | | | |
| Additions | | 4,436 | | 262 | | 1,738 | | 112 | | 6,548 |
+--------------------------+----------+----------+----------+---------------+----------+-------------+----------+----------+----------+----------+
| | | | | | | | | | | |
| Disposals | | (256) | | - | | - | | - | | (256) |
+--------------------------+----------+----------+----------+---------------+----------+-------------+----------+----------+----------+----------+
| | | | | | | | | | | |
| At 30 Apr 2009 | | 54,825 | | 1,019 | | 3,027 | | 833 | | 59,704 |
+--------------------------+----------+----------+----------+---------------+----------+-------------+----------+----------+----------+----------+
| | | | | | | | | | | |
| Additions | | 89 | | - | | 106 | | 29 | | 224 |
+--------------------------+----------+----------+----------+---------------+----------+-------------+----------+----------+----------+----------+
| | | | | | | | | | | |
| At 31 Oct 2009 | | 54,914 | | 1,019 | | 3,133 | | 862 | | 59,928 |
+--------------------------+----------+----------+----------+---------------+----------+-------------+----------+----------+----------+----------+
| | | | | | | | | | | |
| Amortisation and | | | | | | | | | | |
| impairment: | | | | | | | | | | |
+--------------------------+----------+----------+----------+---------------+----------+-------------+----------+----------+----------+----------+
| | | | | | | | | | | |
| At 1 May 2008 | | 4,467 | | 68 | | - | | 351 | | 4,886 |
+--------------------------+----------+----------+----------+---------------+----------+-------------+----------+----------+----------+----------+
| | | | | | | | | | | |
| Amortisation during | | - | | 74 | | 257 | | 145 | | 476 |
| the year | | | | | | | | | | |
+--------------------------+----------+----------+----------+---------------+----------+-------------+----------+----------+----------+----------+
| | | | | | | | | | | |
| Disposals | | (39) | | - | | - | | - | | (39) |
+--------------------------+----------+----------+----------+---------------+----------+-------------+----------+----------+----------+----------+
| | | | | | | | | | | |
| At 30 April 2009 | | 4,428 | | 142 | | 257 | | 496 | | 5,323 |
+--------------------------+----------+----------+----------+---------------+----------+-------------+----------+----------+----------+----------+
| | | | | | | | | | | |
| Amortisation during | | - | | 51 | | 80 | | 65 | | 196 |
| the period | | | | | | | | | | |
+--------------------------+----------+----------+----------+---------------+----------+-------------+----------+----------+----------+----------+
| | | | | | | | | | | |
| Impairment during the | | - | | - | | 1,309 | | - | | 1,309 |
| period | | | | | | | | | | |
+--------------------------+----------+----------+----------+---------------+----------+-------------+----------+----------+----------+----------+
| | | | | | | | | | | |
| At 31 Oct 2009 | | 4,428 | | 193 | | 1,646 | | 561 | | 6,828 |
+--------------------------+----------+----------+----------+---------------+----------+-------------+----------+----------+----------+----------+
| | | | | | | | | | | |
| Net book value: | | | | | | | | | | |
+--------------------------+----------+----------+----------+---------------+----------+-------------+----------+----------+----------+----------+
| | | | | | | | | | | |
| At 31 Oct 2009 | | 50,486 | | 826 | | 1,487 | | 301 | | 53,100 |
+--------------------------+----------+----------+----------+---------------+----------+-------------+----------+----------+----------+----------+
| | | | | | | | | | | |
| At 30 Apr 2009 | | 50,397 | | 877 | | 2,770 | | 337 | | 54,381 |
+--------------------------+----------+----------+----------+---------------+----------+-------------+----------+----------+----------+----------+
| | | | | | | | | | | |
| At 30 Apr 2008 | | 46,178 | | 689 | | 1,289 | | 370 | | 48,526 |
+--------------------------+----------+----------+----------+---------------+----------+-------------+----------+----------+----------+----------+
7.Cash and cash equivalents
Cash and cash equivalents are analysed as follows:
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | As at | | As at | | As at |
| | 31 Oct | | 31 Oct 2008 | | 30 Apr 2009 |
| | 2009 | | | | |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | | | Restated | | |
| | Unaudited | | Unaudited | | Audited |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | | | | | |
| | GBP'000 | | GBP'000 | | GBP'000 |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | | | | | |
| Cash at bank and in hand | 1,301 | | 7 | | 4,625 |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | | | | | |
| Bank overdrafts | - | | (770) | | (35) |
+----------------------------------------------+-------------+--+-------------+--+---------------+
| | | | | | |
| | 1,301 | | (763) | | 4,590 |
+----------------------------------------------+-------------+--+-------------+--+---------------+
8.Amended bank facility
On 2 November 2009 the Group signed an amended facility agreement with
its existing banking syndicate subsequently amended further in January 2010.
Together these amendments give the Group an agreed amended facility of GBP52.1
million, an increase in the previous facility of GBP8.65 million. The facility
is split between a Revolving Credit Facility ("RCF") of GBP33.1 million and a
term loan of GBP19.0 million. Both the RCF and the term loan have a final
maturity date of 31 January 2011. The Group has agreed arrangement and exit
fees of GBP1.1 million in relation to the amended bank facilities which are
payable on final maturity. In addition, the Group has granted 3.2 million
warrants to the Group's banking providers over the ordinary shares exercisable
at par (10 pence) at any time until 1 November 2019. The RCF attracts interest
at LIBOR plus a margin of 400bps. The term loan attracts interest at LIBOR plus
a margin of 500bps with capital repayment of GBP3.25 million on 31 October 2010
with the balance payable on 31 January 2011. Further fees to the Group's
banking providers will be incurred on each of 30 April 2010, 31 July 2010, 31
October 2010 and 31 January 2011 should the term loan not be repaid in full by
those dates. The fees will be between 300 bps and 750 bps depending on the
amounts outstanding under the term loan at the relevant dates. These fees will
be added to the amounts due to the banks on maturity of the term loan (subject
to a minimum of GBP0.6 million).
9. Prior period restatement
The unaudited financial statements for the 6 months ended 31 October
2008 have been restated to reflect the reclassification of the operations
discontinued in the year ended April 2009 detailed in note 2 together with the
impact of the prior period restatement disclosed in the audited financial
statements for the year ended 30 April 2009. The loss for the 6 months ended 31
October 2008 of GBP3,264,000 is not impacted by these restatements.
10. General information
Copies of this report will be sent to
shareholders shortly and will be available from the Company's registered office,
82 St John Street London EC1M 4JN and the company's website at
www.vantisplc.com. The report was approved by the Board on 29 January 2010.
INDEPENDENT REVIEW REPORT TO VANTIS PLC
Introduction
We have been engaged by the company to review the condensed set of financial
statements in the half yearly financial report for the six months ended 31
October 2009 which comprises the Consolidated Income Statement, Consolidated
Statement of Changes in Equity, Consolidated Balance Sheet, Consolidated Cash
Flow Statement and the related notes 1 to 10. We have read the other information
contained in the half-yearly financial report and considered whether it contains
any apparent misstatements or material inconsistencies with the information in
the condensed set of financial statements.
This report is made solely to the company in accordance with guidance contained
in ISRE 2410 (UK and Ireland) "Review of Interim Financial Information Performed
by the Independent Auditor of the Entity" issued by the Auditing Practices
Board. To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the company, for our work, for this report,
or for the conclusions we have formed.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and has been approved
by, the directors. The directors are responsible for preparing the half-yearly
financial report in accordance with the AIM Rules of the London Stock Exchange.
As disclosed in note 1, the next annual financial statements of the group will
be prepared in accordance with those IFRSs adopted for use by the European
Union. This interim report has been prepared in accordance with the requirements
of the AIM Rules of the London Stock Exchange.
The accounting policies are consistent with those that the directors intend to
use in the next financial statements.
Our responsibility
Our responsibility is to express to the Company a conclusion on the condensed
set of financial statements in the half-yearly financial report based on our
review.
Scope of review
We conducted our review in accordance with International Standard on Review
Engagements (UK and Ireland) 2410, "Review of Interim Financial Information
Performed by the Independent Auditor of the Entity" issued by the Auditing
Practices Board for use in the United Kingdom. A review of interim financial
information consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other review
procedures. A review is substantially less in scope than an audit conducted in
accordance with International Standards on Auditing (UK and Ireland) and
consequently does not enable us to obtain assurance that we would become aware
of all significant matters that might be identified in an audit. Accordingly, we
do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe
that the condensed set of interim financial information in the half-yearly
financial report for the six months ended 31 October 2009 is not prepared, in
all material respects, in accordance with the AIM Rules of the London Stock
Exchange.
Emphasis of matter - going concern
In forming our conclusion we have considered the adequacy of the disclosures
made in note 1 of the interim financial information in respect of the material
uncertainties associated with receipts from the Stanford insolvency and the
various cash flow and cost reduction initiatives being undertaken which may cast
significant doubt on the company's ability to continue as a going concern. The
validity of the going concern basis depends on the Group being able to operate
within its current banking facilities and covenants which requires the
successful outcome of the above. The financial information does not include any
adjustments that would result from failure to achieve this.
Our conclusion is not modified in respect of these material uncertainties.
Ernst & Young LLP
London
29 January 2010
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR DBLFXBFFBBBX
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