Interim Results

RNS Number : 0340D

Cinpart PLC

09 September 2008

 



Cinpart Plc ('Cinpart' or the 'Company')

Interim Results For the six months ended 30 June 2008 ('Interims')

CHAIRMAN'S COMMENTARY

I present the interim results for Cinpart plc for the six month period ended 30 June 2008. 

Trading conditions have been difficult throughout this period and consequently the revenue for the Group was £1,090,907 compared with £1,492,836 reported in the same period in 2007. 

The Group reports a loss for the six month period ended 30 June 2008 of £194,416. The loss in the same period in 2007 was £11,486

A number of factors have contributed to the decline in sales: a number of customers increased inventories during the latter part of 2007 and having greater confidence following the successful reorganisation of the Group have reduced these inventories during the first six months of 2008. The majority of customers have reduced levels of business due to adverse economic conditions. 

During the first six months of 2008 there have been wide fluctuations in the exchange rate between Baht, the currency of Thailand where the companies manufacturing operation is located and £ sterling which is the reporting currency used by the Group. While the exchange rate at 30 June 2008 was similar to that at 31 December 2007, average rates during each month used to evaluate expenses were as much as 7% lower thus the reported expenses in £ are higher.

In April 2008, an application was filed to liquidate two Thai companies that have not traded for some time. While all expenses had been provided for in previous years, there remained a cost relating to exchange differences that applied when these company's balance sheets were removed from the group accounts in April 2008. Exchange adjustments charged to expenses were £60,277 and of this £39,256 are attributable to the two Thai subsidiaries liquidated. 

The Group has been successful in improving gross margins to 39.2% during the first six months of 2008 compared with 29.8% in the first six months of 2007. This has been largely achieved through a program of cost reduction and by the addition of plant and equipment including stamping presses and a circuit board manufacturing facility.

The Group has invested heavily to develop an appropriate infrastructure to support the future organic growth of the current operation. This includes hiring and training technical and sales support staff and further initiatives in marketing. These are expected to come to fruition during the remainder of this year and during 2009. The Group also expects to receive ISO certification before the end of 2008 and this will enable the Group to sell to new customers particularly in Europe.

Additionally Cinpart has established a new trading company in the United Kingdom to source components from Asia and or China for sale to small and medium enterprises in the United Kingdom.

The Directors expect that trading during the second half of 2008 will be profitable and for the initiatives in sales and other activities to improve trading in the near future. 

Philip E. Palmer

Chairman

The Interims are available in full on the company's website www.cinpart.com

Kevin Baker - Cinpart Plc	+ 662 709 2647
Ray Zimmerman /Jonathan Evans - Zimmerman Adams International Limited	[phone]
Stephen Goschalk - Newland Stockbrokers	[phone]

  UNAUDITED CONSOLIDATED INCOME STATEMENT

For the six months ended 30 June 2008

				Six Months		Six Months		Year Ended
				Ended 30 June		Ended 30 June		31 December
				2008		2007		2007
				Unaudited		Unaudited
				£		£		£
Revenue				1,090,907		1,492,836		2,816,496
Cost of Sales				(662,884)		(1,047,350)		(1,872,232)
Gross profit				428,023		445,486		944,264
Other operating income				4,541				93,678
Administrative expense				(619,104)		(430,950)		(854,663)
Operating (loss)/profit				(186,540)		14,536		183,279
Finance expense				(8,885)		(26,050)		(72,059)
Finance income				1,009		28		2,676
(Loss)/profit before tax				(194,416)		(11,486)		113,896
Tax				-		-		-
(Loss)/profit for the period				(194,416)		(11,486)		113,896
Earnings per share for profit attributable to the equity holders
during the period
Basic (pence)				-0.61		- 0.13		0.57
Diluted (pence)				-0.52		-0.08		0.47

UNAUDITED STATEMENT OF RECOGNISED INCOME AND EXPENSE

For the six months ended 30 June 2008

				Six Months		Six Months		Year Ended
				Ended 30 June		Ended 30 June		31 December
				2008		2007		2007
				Unaudited		Unaudited
				£		£		£
Exchange gain on retranslation of foreign operations				14,011		12,233		8625
Net expense recognized directly in equity				14,011		12,233		8,625
(Loss)/profit for the period				(194,416)		(11,486)		113,896
Total recognized income and expense for the period				(180,405)		747		122,521

  UNAUDITED CONSOLIDATED BALANCE SHEET

At 30 June 2008

				30 June		30 June		31 December
				2008		2007		2007
				Unaudited		Unaudited
				£		£		£
Assets
Non-current assets
Goodwill				105,028		105,028		105,028
Property, plant and equipment				177,948		113,606		178,280
				282,976		218,634		283,308
Current assets
Inventories				307,626		198,778		281,961
Trade and other receivable				564,894		806,662		787,796
Cash and cash equivalents				20,260		482,450		98,717
				892,780		1,487,890		1,168,474
Total assets				1,175,756		1,706,524		1,451,782
Liabilities
Current liabilities
Trade and other payables				357,051		768,487		475,124
Financial liabilities - borrowings
	Bank overdrafts			-		-		-
	Interest bearing loans and borrowings			100,393		170,331		118,483
				457,444		938,818		593,607
Net current assets/(liabilities)				435,336		549,072		574,867
Non current liabilities
Financial liabilities - borrowings
	Interest bearing loans and borrowings			-		13,000		13,498
Total liabilities				457,444		951,818		607,105
Net assets/(liabilities)				718,312		754,706		844,677
Equity
Called up share capital				3,766,748		3,756,907		3,759,763
Share premium				2,233,163		2,353,419		2,186,108
Merger reserve				128,571		-		128,571
Retained earnings				(5,485,186)		(5,416,152)		(5,290,770)
Share option reserve				88,081		84,000		88,081
Foreign exchange reserve				(13,065)		(23,468)		(27,076)
Total equity				718,312		754,706		844,677

  UNAUDITED CASH FLOW STATEMENT

For the six months ended 30 June 2008

				Six Months		Six Months		Year Ended
				Ended 30 June		Ended 30 June		31 December
				2008		2007		2007
				Unaudited		Unaudited
				£		£		£
Net cash used in operating activities				(69,919)		(58,187)		(135,040)
Investing activities
Acquisition of subsidiary, cash acquired						(205,840)		10,886
Purchase of property plant and equipment				(23,115)		(22,798)		(87,591)
Sale of property plant and equipment								25,385
Interest received				1,009		28		2,676
Net cash used in investing activities				(22,106)		(228,610)		(48,644)
Financial activities
(Repayment)/issue of loans						-		(13,000)
Receipt of/(repayment) finance leases				24,256		-		(11,774)
(Repayment)/increase in bank and other borrowing				(55,844)		(704,250)		(424,065)
Proceeds on issue of shares				54,040		1,492,302		815,513
Interest paid				(8,885)		(26,050)		(62,167)
Net cash from financing activities				13,567		762,002		304,507
Cash and cash equivalents at beginning of period				98,717		7,245		(22,106)
Cash and cash equivalents at end of period				20,260		482,450		98,717

 

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