RNS Number : 4410A
Wyatt Group PLC
01 August 2008
WYATT GROUP PLC
PRELIMINARY RESULTS ANNOUNCEMENT
FOR THE YEAR ENDED 31 MARCH 2008
CHAIRMAN'S STATEMENT
This has been a year of significant change for the Group. We have seen a move away from the original strategy and the transition has not
been without its challenges. However, I am very pleased to announce that the Group was still able to make a profit on continuing activities
before taxation of �415,026 (�410,923 - 2007). This was on turnover from continuing activities of �2,249,136 (�1,810,775 - 2007).
Discontinued Activities
We have finally divested all interest in Risksmart. Despite many years of hard work and some significant investment, the business
failed to hit the targets that were set. It was not helped by continuing delays in legislation however it was considered that it was in the
best interests of Wyatt Group and its shareholders if Risksmart continued its activities outside the Group.
Similarly there have been difficulties in the Group's drug testing operation, Wyatt Biotech. We announced on 28th September that this
business is now being run as a joint venture and that we have drawn a line under our investment. Since then there have been some signs of
progress with the production issue, however this has been incredibly slow, with a number of deadlines still not being met. This vindicates
our decision to remove this from our core business.
Continuing Activities
Our employment consultancy and support business Premier Employer Solutions Limited ('PES') represents our primary trading subsidiary,
the other being the newly acquired Health and Safety Department Limited. PES has enjoyed a period of significant success and is solely
responsible for the Group's turnaround. The business was hit by a change in tax legislation at the end of 2007 which will have a
significant adverse affect on Group's trading in the current year. However, the management is busy building up the core business and have
some exciting things in the pipeline. We remain confident that the long term prospects for PES are positive despite the current challenging
economic climate.
Next Steps
In December of last year I announced that the Group's strategy was to build the future around the success of PES and to look for
opportunities for growth in the employment services and other service sectors. We have now successfully disposed of the non performing
businesses and have some exciting opportunities in prospect.
The employment services market is very fragmented and we believe that there is a tremendous opportunity for growth in this sector. I am
therefore delighted to announce the acquisition of the employee benefits consultancy, TEBC Limited. The business fits in neatly with the
PES existing service offering. It is a profitable business with a strong management team and a healthy client list. With scope for
development it neatly fits the criteria that we set for our acquisition targets and represents' our first step toward our commitment to
growth in this area.
We are committed to building the Group and are also looking at opportunities in the wider service sector where, in the opinion of the
Board, there are synergies with our core business. I look forward to bringing you news on this in the future.
R HOLT
Chairman
31 July 2008
For Further Enquiries:
Enquiries:
Wyatt Group PLC www.wyattgroup.co.uk
Bob Holt, Chairman 07778 798 816
David Curtis, Finance Director 0845 450 9110
Blue Oar Securities Plc www.blueoarsecurities.co.uk
John Wakefield / Marc Davies 0117 933 0020
CONSOLIDATED INCOME STATEMENT - UNAUDITED
For the year ended 31 March 2008
note 2008 2007
� �
Continuing operations
Revenue 2,249,136 1,810,775
Cost of sales (661,571) (529,171)
Gross profit 1,587,565 1,281,604
Administrative expenses (1,096,023) (802,502)
Operating profit 491,542 479,102
Share of operating loss in joint venture (37,891) (31,963)
Finance costs (38,625) (36,216)
Profit from continuing operations before tax
expense 415,026 410,923
Tax expense - -
Profit for the period from continuing 415,026 410,923
operations
Discontinued operations
Loss for the period from discontinued 3
operations (935,461) (169,651)
(Loss)/profit for the period (520,435) 241,272
Attributable to:
Equity holders of the company (450,694) 254,660
Minority interests (69,741) (13,388)
(Loss)/profit for the period (520,435) 241,272
Basic and diluted (loss)/earnings per share
on discontinued activities (pence) 2 (6.49) (1.23)
Basic and diluted earnings per share on
continuing activities (pence) 3.11 3.25
Basic and diluted earnings per share on all
activities (pence) (3.38) 2.01
CONSOLIDATED BALANCE SHEET - UNAUDITED
As at 31 March 2008
2008 2007
� �
ASSETS
Non-current assets
Intangible assets 1,223,578 1,330,647
Property, plant and equipment 101,449 207,312
Investments - 67,574
1,325,027 1,605,533
Current assets
Inventories 31,516 15,500
Trade and other receivables 628,850 586,904
Total current assets 660,366 602,404
Total assets 1,985,393 2,207,937
LIABILITIES
Current liabilities
Trade and other payables (705,926) (685,157)
Share of joint venture net liabilities (34,230) -
Borrowings (821,058) (629,568)
Deferred consideration - (360,000)
Total current liabilities (1,561,214) (1,674,725)
Non-current liabilities
Borrowings (29,128) (28,430)
Deferred consideration (920,835) (920,835)
Total non-current liabilities (949,963) (949,265)
Total liabilities (2,511,177) (2,623,990)
Net liabilities (525,784) (416,053)
EQUITY
Share capital 140,654 126,594
Share premium account 2,088,640 1,902,700
Merger reserve 41,802 41,802
Minority interests - (140,963)
Profit and loss account (2,796,880) (2,346,186)
Total Equity (525,784) (416,053)
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 March 2008
Share Capital Share Premium Merger Reserve Retained Earnings Minority Interest Total Equity
� � � � � �
Balance 1 April 2006 126,594 1,902,700 41,802 (2,600,846) (127,575) (657,325)
Profits for the period - - - 254,660 (13,388) 241,272
Balance 31 March 2007 126,594 1,902,700 41,802 (2,346,186) (140,963) (416,053)
Balance 1 April 2007 126,594 1,902,700 41,802 (2,346,186) (140,963) (416,053)
Loss for the period - - - (450,694) (69,741) (520,435)
Disposal of subsidiary - - - - 210,704 210,704
Sub-total recognised
gains and losses 126,594 1,902,700 41,802 (2,796,880) - (725,784)
Issue of shares 14,060 185,940 - - - 200,000
Balance 31 March 2008 140,654 2,088,640 41,802 (2,796,880) - (525,784)
CONSOLIDATED CASH FLOW STATEMENT - UNAUDITED
For the year ended 31 March 2008
2008 2007
� �
Cash flows from operating activities
(Loss)/profit after taxation (520,435) 241,272
Adjustments for:
Depreciation & Impairment charges 575,696 123,580
Share of JV operating loss 37,891 31,963
Interest expense 79,130 80,427
Taxation expense recognized in profit and loss - -
Increase in trade and other receivables (31,377) (328,772)
Decrease/(increase) in inventories (16,016) 36,527
(Decrease)/increase in trade payables (346,994) 224,743
Loss on disposal of fixed assets 20,010 -
Cash generated from operations (202,095) 409,740
Interest paid (79,130) (80,427)
Income taxes paid - -
Net cash from operating activities (281,225) 329,313
Cash flows from investing activities
Acquisition of subsidiary Health & Safety Department
Limited 29,807 3,106
Purchase of property, plant and equipment 50,552 89,738
Net cash used in investing activities 80,359 92,844
Cash flows from financing activities
Proceeds from issue of share capital 200,000 -
Payment of finance lease liabilities (30,604) -
Net cash used in financing activities 169,396 -
Net increase/(decrease) in cash and cash equivalents (192,188) 236,469
Cash and cash equivalents at beginning of the period (657,998) (894,467)
Cash and cash equivalents at end of the period (850,186) (657,998)
NOTES
For the year ended 31 March 2008
1. BASIS OF PREPARATION
The financial information set out in the announcement does not constitute the Group's statutory accounts for the years ended 31 March
2008 or 2007. The financial information for the year ended 31 March 2007 is derived from the statutory accounts for that year which have
been delivered to the Registrar of Companies. The auditors reported on those accounts; their report was unqualified and did not contain a
statement under s.237 (2) or (3) Companies Act 1985.
The summarised balance sheet at 31 March 2008 and the summarised profit and loss account, summarised cash flow statement, the statement
of changes in equity and associated notes for the year then ended have been extracted from the Group's financial statements. Those financial
statements have not yet been delivered to the Registrar, nor have the auditors reported on them.
The consolidated financial statements for the year ended 31 March 2008 will be prepared in accordance with applicable International
Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board as adopted by the EU.
The policies have changed from the previous year when the financial statements were prepared under applicable United Kingdom Generally
Accepted Accounting Principles (UK GAAP). The comparative information has been restated in accordance with IFRS.
2. EARNINGS PER SHARE
The basic earnings per share is based upon an equity loss of �450,694 (2007: �254,660 profit) and 13,348,952 (2007: 12,659,446) ordinary
shares of 1p each, being the weighted average number of shares in issue during the period.
The diluted earnings per share is identical to the basic earnings per share because the exercise price of all the share options in issue
during the year was greater than the average market price of the share throughout the year. Therefore, the share options are not considered
to be dilutive.
3. DISCONTINUED OPERATIONS
During the year ended 31 March 2008 the management of Wyatt Group PLC revisited and evolved its strategy, concluding to concentrate
solely on the more successful employment services segment of the business. As a result of the Group carried out the following transactions:
Risksmart Limited
On 2 February 2008 the trade and selected assets of Risksmart Limited were sold to Risksmart Services Limited, a company owned and run
by the former management team of Risksmart Limited. Wyatt initially retained all other assets including the intellectual property rights for
the three main website products: Firesmart, Health & Safety Smart and Business Smart. These products were licensed back to Risksmart
Services Limited who are responsible for the websites hosting and development costs and pay Wyatt a commission per sale.
The consideration for the transaction was �1.00 (one pound) payable at completion, and the assumption of certain liabilities, including
commission payments totalling approximately �70,000 and those in relation to the occupation of the premises from which the business trades.
Wyatt further announced on 21 February 2008 that it had agreed to sell the Risksmart debtor book to Risksmart Services Limited for a
consideration of a maximum of �100,000 payable in instalments (over a maximum period of 12 months) plus an additional 25% of all receipts
collected in excess of �100,000.
Wyatt Biotech Limited
During the year, the Group took steps to limit its exposure to providing further funding for ongoing costs in the Biotech business and
sold 50% of it's shareholding to the US inventor, creating a joint venture.
Running costs are now shared with the US inventor/developer who injected funds into the business during the year to bring the product up
to the point where it can be taken to market.
2008 2007
� �
Operating activities of discontinued operations
Revenue 708,589 1,160,325
Cost of sales (233,653) (251,876)
Operating expenses (1,021,886) (1,032,689)
Finance costs (40,505) (53,894)
Net operating result from discontinued operations (587,455) (178,134)
Disposal of 50% of shares in Wyatt Biotech at nil (3,661) -
consideration
50% share of net liabilities of Wyatt Biotech no 168,409 -
longer recognised
Impairment of investment in Biotech distribution (186,434) -
agreement
Costs of disposal of Risksmart Limited business (38,137) -
for �1
Impairment of Risksmart Limited goodwill (182,732) -
Impairment of investment in Audio Medical (67,574) -
Services Limited
Loan to Audio Medical Services Limited written (37,877) -
off
Net result from discontinued operations (935,461) (178,134)
This information is provided by RNS
The company news service from the London Stock Exchange
END
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