RNS Number:1047Y
Worldsec Ld
28 April 2004
Worldsec Limited
Preliminary Statement of Annual Results
Worldsec Limited is pleased to release today its preliminary statement of annual
results for the year ended 31 December 2003.
The Chairman's Statement and extracts from the audited financial statements are
reproduced below.
Investor Relations
For further information please contact:
In Hong Kong
Mr Paul K K Cheng
Chief Operating Officer and Finance Director
+852 2867 7213
CHAIRMAN'S STATEMENT
RESULTS
The audited consolidated profit after taxation was US$1.54m (2002: loss of
US$7.87m).
Earnings per share based on the weighted average number of shares in issue
during the year amounted to US 11 cents (2002: loss of US 59 cents).
THE YEAR IN REVIEW
As a result of the Group's withdrawal from it's main business of stockbroking
during the previous year, turnover fell in 2003 by 96%. The Group was however
able to record a profit for the financial year due to surplus on investments
realized and the recovery of doubtful receivables. Costs were pruned
vigorously, particularly staff costs, as the various businesses were liquidated
or sold. We now have a staff of only three.
The process of realizing assets into cash proceeded well but somewhat slower
than expected. The disposal of certain assets subject to regulatory approval
proved to be a very time consuming exercise.
During the year, the Group sold Worldsec Corporate Finance Limited and reached
agreement to sell Worldsec Brokerage Limited at their respective net asset
values. Completion of the sale of Worldsec Brokerage Limited is conditional
upon receiving all necessary regulatory consents and the satisfaction of certain
conditions precedent and it is hoped that the sale will shortly be concluded.
The Group has now largely realized its investments including the sale of its
listed investment in Taiwan which sale and the subsequent repatriation of the
proceeds had been subjected to a lengthy process of obtaining regulatory
approvals.
The Group made a distribution of US45 cents per share to shareholders on 12
August 2003 and your directors had intended to make a second distribution of
US35 cents per share by the end of last year. Given the cost associated with
making such a distribution and our expectation that the proceeds from certain
asset liquidation would be available by April 2004, it was decided to hold over
the intended distribution and the directors have since resolved on 29 March 2004
to make a second distribution of US70 cents per share to shareholders payable on
28 April 2004.
Chairman's Statement
PROSPECTS
The second distribution of US70 cents together with the distribution last year
of US45 cents per share represent the bulk of the assets of the Group which had
been estimated at US$1.15 per share. However, it is hoped that the eventual
payout to shareholders will exceed the previous estimate of US$1.15 per share.
The main remaining assets of the Group include debtors in the course of
collection, brokerage trading rights and a small office property in the
Philippines and some other illiquid assets. There is no certainty that some of
these assets will be sold at book value nor about the likely timing of their
realization into cash. However, every effort will be made to realize the
remaining assets and to minimize costs while we complete the liquidation of the
Group.
David Archibald Evelyn Lyle
Non-Executive Chairman
28 April 2003
CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2003
Year ended 31 December
Notes 2003 2002
US$'000 US$'000
Turnover 1 197 5,402
Fees and commission payable (216) (1,131)
________ _______
(19) 4,271
Gain on disposal of intangible assets - 159
Gain on disposal of investements 288 -
Unrealised gain on investments 1,237 93
Recovery of doubtful receivables 1,391 -
Other operating income 159 662
________ _______
3,056 5,185
Staff costs (641) (6,382)
Provision for doubtful receivables - (3,250)
Impairment losses (89) (201)
Other operating costs (815) (3,062)
_________ ________
Operating profit (loss) 1 1,511 (7,710)
Interest receivable and similar income 55 204
Interest payable and similar charges (13) (277)
Loss on disposal of subsidiaries and research material (14) (111)
_________ _________
Profit (Loss) on ordinary activities before taxation 1,539 (7,894)
Tax (charge) credit on ordinary activities 2 (2) 27
_________ _________
Profit (Loss) for the financial year 1,537 (7,867)
_________ _________
Earnings (Loss) per share - basic and diluted 3 11 cents (59) cents
======= =======
The results above relate entirely to discontinued operations.
CONSOLIDATED BALANCE SHEET
AT 31 DECEMBER 2003
Notes 2003 2002
US$'000 US$'000
Current assets
Investments 3,672 3,047
Debtors 3,266 5,698
Bank deposits and cash 7,001 18,011
______ _____
13,939 26,756
Creditors: Amounts falling due within one year (2,433) (10,735)
______ _____
Net current assets 11,506 16,021
Provisions for liabilities and charges - -
______ _____
Net assets 11,506 16,021
======= =======
Capital and reserves
Called up share capital 4 13 13,367
Share premium 4 - 11,664
Contributed surplus 4 19,003 -
Special reserve 4 625 625
Profit and loss account 4 (7,430) (8.967)
Revaluation reserve 4 281 294
Currency translation reserve 4 (986) (962)
________ ________
Equity shareholders' funds 11,506 16,021
======= ======
CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2003
Note Year ended 31 December
2003 2002
US$'000 US$'000
Cash inflow (outflow) from operating activities 6 3,416 (1,073)
__________ _________
Returns on investments and servicing of finance
Interest received from banks and deposit taking companies 55 204
Interest paid on bank loans and overdrafts (13) (277)
__________ _________
Net cash inflow (outflow) from returns on investments and 42 (73)
servicing of finance
__________ _________
Taxation 99 (144)
Tax refunded (paid) __________ _________
Capital expenditure and financial investment
Sale of intangible assets - 443
Sale of tangible fixed assets - 149
Sale of Shanghai exchange membership 75 -
__________ __________
Net cash inflow from capital expenditure and financial 75 592
investment
__________ __________
Acquisition and disposal
Net cash (outflow) inflow from disposal of subsidiaries (14) 53
Net cash outflow from disposal of research materials
and futures trading right - (63)
_________ __________
Net cash outflows from acquisition and disposal (14) (10)
_________ __________
Equity dividend paid
Distribution paid (6,015) -
________ _________
Net cash outflow before use of liquid resources and (2,397) (708)
financing
Management of liquid resources
(Increase) Decrease in time deposit of maturity exceeding (4,975) 2,427
1 day
________ _________
(Decrease) increase in cash (7,372) 1,719
====== =======
NOTES TO THE PRELIMINARY STATEMENT OF ANNUAL RESULTS
FOR THE YEAR ENDED 31 DECEMBER 2003
1. ANALYSIS OF TURNOVER, OPERATING PROFIT (LOSS) AND NET ASSETS
The turnover attributable to the different classes of the Group's business
is as follows:
Year ended 31 December
2003 2002
US$'000 US$'000
Analysis by class of business:
Broking and related services 197 4,683
Corporate finance - 719
_________ ________
197 5,402
======= ======
Geographical analysis of turnover:
Hong Kong 197* 4,420
Thailand - 889
Malaysia - 6
Singapore - 37
Philippines - 6
Others - 44
________ ________
197 5,402
======= =======
* The broking and related services related substantially to the Hong Kong
market.
The operating profit (loss) attributable to the different classes of
Group's business is as follows:
Broking and related services 1,511 (7,586)
Corporate finance - (124)
________ _________
1,511 (7,710)
====== =======
During the year, the operating profit of the Group was derived from the
Group's operations based in Hong Kong and the net assets of the Group were
related to broking activities and were substantially situated in Hong Kong.
2. TAX (CHARGE) CREDIT ON ORDINARY ACTIVITIES
Year ended 31 December
2003 2002
US$'000 US$'000
The (charge) credit comprises:
UK Corporation Tax
Current year at 30% (2002: 30%) - -
Hong Kong Profits Tax
Current year at 17.5% (2002: 16%) (2) 2
Other overseas taxation - (5)
_________ _________
(2) (3)
- 30
_________ _________
(2) 27
======= =======
3. EARNINGS (LOSS) PER SHARE
Calculation of earnings (loss) per share was based on the following:
Year ended 31 December
2003 2002
Profit (Loss) for the financial year US$1,537,000 US$(7,867,000)
======== =========
Weighted average number of shares in issue 13,367,290 13,367,290
======== =========
Earnings (Loss) per share 11 cents (59) cents
======== =========
4. CAPITAL AND RESERVES
CALLED UP SHARE CAPITAL
Authorised: US$
Ordinary shares of US$1 each as at 1 January 2003 50,000,000
Reduced by capital reduction on 23 July 2003* 49,950,000
Ordinary shares of US$0.001 each as at 31 December 50,000
2003* -
======
Called up, issued and fully paid: 13,367,290
Ordinary shares of US$1 each as at 1 January 2003 -
Reduced by capital reduction on 23 July 2003 and 13,353,923
transferred to contributed surplus* -
Ordinary shares of US$0.001 each as at 31 December 13,367
2003* ========
4. CAPITAL AND RESERVE - continued
RESERVES
Movements on reserves were as follows:
Share Contributed Special Profit Revaluation Currency
Premium surplus reserve and loss Reserve translation
account reserve
US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
The Group
At 1 January 2003 11,664 - 625 (8.967) 294 (962)
Profit for the year - - - 1,537 - -
Translation adjustment - - - - (13) (24)
Transfer from share
premium to
Contributed surplus * (11,664) 11,664 - - - -
Transfer from share - 13,354 - - - -
capital *
Distribution paid ** - (6.015) - - - -
(note 5(a))
At 31 December 2003 - 19,003 625 (7,430) 281 (986)
====== ====== ====== ====== ====== ======
* Pursuant to an ordinary resolution passed at the Company Special General
Meeting held on 23 July 2003, the Company :
(i) reduced the nominal value of the authorised and issued shares of the
Company from US$1.00 to US$0.001 per share, and the issued share
capital of the Company by US$13,353,922.71 from US$13,367,290.00 to
US$13,367.29 divided into 13,367,290 new shares of US$0.001 each;
(ii) reduced the amount of US$11,663,851.00 standing to the credit of the
share premium account of the Company to nil; and
(iii) applied the credit of US$25,017,773.71 arising from the reductions
noted in (i) and (ii) above to the contributed surplus account of the
Company.
5. DISTRIBUTIONS
(a) On 23 July 2003, the Board resolved to pay a distribution out of the
contributed surplus account of US$0.45 per share totalling US$6,015,281 to
the shareholders whose names appeared in the register of members on 1
August 2003.
(b) On 29 March 2004, the Board resolved to pay a distribution out of the
contributed surplus account of US$0.70 per share totalling US$9,357,103 to
the shareholders whose names appeared in the register of members on 13
April 2004.
6. RECONCILIATION OF OPERATING PROFIT (LOSS) TO NET CASH INFLOW (OUTFLOW) FROM
OPERATING ACTIVITIES
Year ended 31 December
2002 2002
US$'000 US$'000
Operating profit (loss) 1,511 (7,710)
Gain on disposal of intangible assets - (159)
Gain on disposal of tangible fixed assets - (38)
Depreciation - 196
Provision for doubtful receivables - 3,250
Unrealised gain on investments (1,237) (93)
Impairment losses 89 201
Amortisation of intangible assets 19 93
Exchange difference (72) 207
Decrease in investments held as current assets 464 67
Decrease in trade debtors 1,027 16,761
Decrease (increase) in other debtors and prepayments 1,304 (580)
Decrease in cash at banks - trust accounts 8,613 10,214
Decrease in trade creditors (7,544) (23,982)
(Decrease) increase in other creditors and accruals (758) 500
_________ ________
NET CASH INFLOW (OUTFLOW) FROM OPERATING ACTIVITIES 3,416 (1,073)
======= =======
4. RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET FUNDS
Year ended 31 December
2003 2002
US$'000 US$'000
(Decrease) increase in cash (7,372) 1,719
Cash outflow (inflow) from increase (decrease) in liquid 4,975 (2,427)
resources
________ ________
Movement in net funds (2,397) (708)
Net funds brought forward 9,398 10,106
________ ________
Net funds carried foward 7,001 9,398
======= =======
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR QKFKDPBKDOQB
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