Interim Results
Billam PLC
28 September 2007
Billam plc
Condensed Consolidated Interim Financial statements for the period ended 30 June
2007
Chairman's Statement
Background
The Board of Billam Plc ('the Group'), announces its interim results for the six
months to 30 June, 2007.
As reported in my statement to shareholders which accompanied the 2006 Annual
Report and Accounts, we have, through our wholly owned subsidiary company,
Development Funding Limited ('DFL'), made our first investment of mezzanine
finance to a privately owned housebuilder, for a specific development in
Northamptonshire. The development consists of 29 three and four bedroom houses.
Building work has progressed well and the first two units including the
showhouse, which was opened at the end of August, have now been completed. We
anticipate that construction on the whole project will have been completed in
the first quarter of 2008.
To date we have provided over £ 0.9 million to this project, with these funds
having been made available to Billam by Stephen Wicks, who is the Company's
largest shareholder. At 30 June, 2007 Mr Wicks had lent the Company £1.1 million
on commercial terms.
Further details of our quoted and unquoted investment portfolio are set out
below.
Results
The Board announce that the deficit on ordinary activities before taxation has
been reduced to £0.435 million, as compared with a deficit of £0.759 million for
the comparative period last year. The principal reason for the deficit in the
first half was the reduction in the value of our quoted and unquoted investment
portfolio, which amounted to £0.394 million, further details of which are set
out below.
I am however, pleased to be able to report that we have been successful in
reducing our administrative overheads for the period to £120,000 from £262,000
for the comparative period last year.
Net assets at 30 June, 2007 were £1.1 million (2006: £1.6 million) compared with
the net assets at 31 December, 2006 which amounted to £1.5 million.
The Directors do not recommend a payment of an interim dividend.
We have a number of quoted and unquoted investments in our portfolio, as
follows:
Quoted Investments
Cybit Holdings plc
Cybit Holdings plc ('Cybit') is one of Europe's leading telematics service
providers that has over 1,500 customers using its fleet and asset management
solutions to manage over 40,000 vehicle based assets. The company has recently
released an extremely positive trading statement in which it stated that they
now have a leading position in a number of key sectors in the market and that
their trading results are benefiting from a significant contribution from their
three most recent acquisitions, that have been successfully integrated.
Cybit have also reported that current trading has started extremely well in the
first four months of the year and that the directors of Cybit are confident
about the company's prospects.
EiRx Therapeutics plc
EiRx Therapeutics plc ('EiRx') is based in Cork, Ireland and is a drug discovery
house developing targeted therapies for cancer. EiRx has recently announced that
it has received a grant from Enterprise Ireland to fund the development of new
cancer medicines through a collaboration with the University College Cork. This
award amounts to €0.36 million spread over a two year period. The collaboration
will work on optimisation of the most promising of EiRx's panel of molecules
identified by EiRx's proprietary EnPADTM platform.
Physiomics plc
Physiomics plc ('Physiomics') is a company that develops computational models
that predict and understand the efficacy of cancer drugs. Physiomics has
recently announced that it has signed an agreement with Eli Lilley, the NYSE
listed global pharmaceutical company, to provide simulations of cancer cellular
processes in support of Eli Lilley's cancer drug discovery research.
Unquoted Investments
TRI-MEX Group Limited
TRI-MEX Group Limited ('TRI-MEX') provides monitoring and protection solutions
for the protection of vehicles and goods in transit. TRI-MEX has agreements with
Jaguar cars and Land Rover to provide pan-European EUROWATCH services for each
of their own brand tracking products. TRI-MEX has recently signed a contract
with TIP Trailer Services, a division of General Electric Equipment Services, to
allow the users of their EUROWATCH service to gain access to police whenever and
wherever a freight crime occurs.
Basis of accounts preparation
Previously the Board of Billam had taken the view that, whilst Billam plc was
not an investment company within the meaning of the Companies Act, it was
managed in a manner similar to that of an Investment Trust. As such, Billam had
reported its results in line with the Statement of Recommended Practice for
Investment Trusts.
As shareholders may be aware, groups listed on AIM are now required to prepare
their financial statements in accordance with International Financial Reporting
Standards ('IFRS') as adopted by the EU. Accordingly, these financial statements
have been prepared under IFRS rather than UK GAAP, the accounting convention
that Billam's previous financial statements were prepared under. Where
appropriate a reconciliation between the respective figures has been provided in
the text that accompanies these results.
Outlook
Your Board continues to look at investment opportunities that we are seeing
through our development financing business DFL and our quoted and unquoted
investment portfolio. We intend to take advantage, funds permitting, of such
opportunities and to further rationalise our investment portfolio when we
receive offers that match our valuations.
S Bennett
27 September 2007
Condensed consolidated interim income statement
Unaudited Unaudited Unaudited
6 months to 6 months Year to 31
30 June to 30 June December
2007 2006 2006
Note £'000 £'000 £'000
Continuing operations
Revenue 47 42 86
Losses on investments (394) (530) (454
------------------------- ------------------------- ------------
Gross loss (347) (488) (368
Administrative costs (120) (262) (515)
Finance costs (52) (9) (29)
Finance income 84 - -
------------------------- ------------------------- -------------
Loss before (435) (759) (912)
tax
Income tax expense - - -
------------------------- ------------------------- -------------
Loss for the (435) (759) (912)
period
=========== =========== ===========
=========== =========== ===========
=== === ===
Loss per share:
Basic and diluted loss per share from (4.10)p (7.26)p (8.67)p
total and continuing operations 4
=========== =========== ===========
=========== =========== ===========
=== === ===
Condensed consolidated interim balance sheet
Unaudited Unaudited Unaudited
30 June 30 June 31 December
2007 2006 2006
Note £'000 £'000 £'000
ASSETS
Non-current
assets
Financial 1,787 2,551 2,446
assets at fair
value through
profit and
loss 3
Current assets
Loans and receivables 923 - -
Trade and other receivables 31 130 121
Other current assets 149 - 50
Cash and cash equivalents 20 11 1
------------------------- ------------------------- ------------
1,123 141 172
------------------------- ------------------------- ------------
Total assets 2,910 2,692 2,618
------------------------- ------------------------- ------------
LIABILITIES
Current liabilities
Trade and other payables 420 386 352
Short-term borrowings 1,064 193 353
------------------------- ------------------------- -----------------------
1,484 579 705
------------------------- ------------------------- -----------------------
Non-current liabilities
Long-term borrowings 291 280 282
Other payables 59 271 170
------------------------- ------------------------- -------------------------
Total 350 551 452
non-current
liabilities
------------------------- ------------------------- -------------------------
Total 1,834 1,130 1,157
liabilities
------------------------- ------------------------- -------------------------
Net assets 1,076 1,562 1,461
========================= ========================= =========================
EQUITY
Equity attributable to equity holders of
the parent
Share capital 2,279 2,250 2,279
Share premium account 5,423 5,409 5,423
Convertible loan 68 9 18
Merger reserve 1,012 1,012 1,012
Profit and loss account (7,706) (7,118) (7,271)
------------------------- ------------------------- -------------------------
Total equity 1,076 1,562 1,461
========================= ========================= =========================
Condensed consolidated interim statement of changes in equity
Share Share Convertible Merger Profit and Total
capital premium Loan reserve Loss equity
Balance at account account
2005 £'000 £'000 £'000 £'000 £'000 £'000
December 2,250 5,409 - 1,012 (6,359) 2,312
Changes in equity for first half of 2006
Loss for - - - - (759) (759)
the period
Total
recognised - - - - (759) (759
income and
expense for
the period
Convertible - - 9 - - 9
loan -
equity
Balance at 2,250 5,409 9 1,012 (7,118) 1,562
30 June
2006
Condensed consolidated interim statement of changes in equity (continued)
Share Share Convertible Merger Profit and Total
capital premium loan reserve loss equity
account
£'000 £'000 £'00 £'000 £'000 £'000
Balance 2,250 5,409 - 1,012 (6,359) 2,312
at
31 December
2005
Changes in
equity for
2006
Loss for - - - - (912) (912
the period
Total recognised - - - - (912) (912
income and
expense for
the period
Issue of 29 14 - - - 43
share
capital
Convertible - - 18 - - 18
loan -
equity element
Balance at
31 December 2,279 5,423 18 1,012 (7,271) 1,461
2006
========================= ========================= =========================
Condensed consolidated interim statement of changes in equity (continued)
Share Share Convertible Merger Profit Total
capital premium loan reserve and loss equity
account account
£'000 £'000 £'000 £'000 £'000 £'000
Balance at 2,279 5,423 18 1,012 (7,271) 1,461
31 December
2006
Changes in
equity for
2007
Loss for - - - - (435) (435
the period
Total - - - - (435) (435)
recognised
income and
expense for
the period
Convertible
loan - equity - 50 - - 50
element
Balance at 2,279 5,423 68 1,012 (7,706) 1,076
30 June
2007
Condensed consolidated interim cash flow statement
6 months to 6 months Year to 31
30 June to 30 June December
2007 2006 2006
£'000 £'000 £'000
Cash flows from operating activities
Loss after taxation (435) (759) (912)
Adjustments for:
Fair value adjustments 430 506 588
(Profit)/loss on sale of investments (36) 24 (134)
Interest expense 52 9 29
Increase in trade and other receivables (914) (62) -
Decrease in trade payables (70) 12 (197)
Interest received (19) - -
Net cash from (992) (270) (626)
operating
activities
Cash flows from investing activities
Purchase of investments - (46) (46)
Proceeds from sale of investment 265 171 352
Net cash used 265 125 306
in investing
activities
Cash flows from financing activities
Proceeds from short-term borrowings 777 150 335
Re-payment of short term borrowings - (3) (54)
Net cash used 777 147 281
in financing
activities
Net increase/(decrease) in cash and cash 50 2 (39)
equivalents
Cash and cash equivalents at beginning (30) 9 9
of period
Cash and cash 20 11 (30)
equivalents at
end of period
The financial information set out in this interim report does not constitute
statutory accounts as defined in Section 240 of the Companies Act 1985.
The Group's statutory financial statements for the year ended 31 December 2006,
prepared under UK GAAP, have been filed with the Registrar of Companies.
The auditor's report on those financial statements was unqualified and did not
contain statements under Section 237(2) of the Companies Act 1985.
1 Basis of preparation
These interim condensed consolidated financial statements are for the six months
ended 30 June 2007 and have been prepared under the historical cost convention,
except for the revaluation of certain non??current assets and financial assets
and liabilities.
These condensed consolidated interim financial statements (the interim financial
statements) have been prepared in accordance with the accounting policies set
out below which are based on the recognition and measurement principles of IFRS
in issue as adopted by the European Union (EU) and are effective at
31 December 2007 or are expected to be adopted and effective at
31 December 2007, our first annual reporting date at which we are required to
use IFRS accounting standards adopted by the EU.
Billam plc's consolidated financial statements were prepared in accordance with
United Kingdom Accounting Standards (United Kingdom Generally Accepted
Accounting Practice) until 31 December 2006. The date of transition to IFRS was
1 January 2006. The comparative figures in respect of 2006 have been restated to
reflect changes in accounting policies as a result of adoption of IFRS. The
disclosures required by IFRS 1 concerning the transition from UK GAAP to IFRS
are given in the reconciliation schedules, presented and explained in note 5.
The accounting policies have been applied consistently throughout the Group for
the purposes of preparation of these condensed consolidated interim financial
statements.
2 Summary of significant accounting policies
The Group has taken advantage of certain exemptions available under IFRS1
First-time adoption of International Financial Reporting Standards. The
exemptions used are explained under the respective accounting policy.
The accounting policies that have been applied in the opening balance sheet have
also been applied throughout all periods presented in these financial
statements. These accounting policies are prepared based on recognition and
measurement principles expected to be adopted and effective for the year ending
31 December 2007.
Basis of consolidation
The Group financial statements consolidate those of the Company and all of its
subsidiary undertakings drawn up to 30 June 2007. Subsidiaries are entities over
which the Group has the power to control the financial and operating policies so
as to obtain benefits from its activities. The Group obtains and exercises
control through voting rights.
Unrealised gains on transactions between the Company and its subsidiaries are
eliminated. Unrealised losses are also eliminated unless the transaction
provides evidence of an impairment of the asset transferred. Amounts reported in
the financial statements of subsidiaries have been adjusted where necessary to
ensure consistency with the accounting policies adopted by the Group.
Acquisitions of subsidiaries are dealt with by the purchase method. The purchase
method involves the recognition at fair value of all identifiable assets and
liabilities, including contingent liabilities of the subsidiary, at the
acquisition date, regardless of whether or not they were recorded in the
financial statements of the subsidiary prior to acquisition. On initial
recognition, the assets and liabilities of the subsidiary are included in the
consolidated balance sheet at their fair values, which are also used as the
bases for subsequent measurement in accordance with the group accounting
policies. Goodwill is stated after separating out identifiable intangible
assets. Goodwill represents the excess of acquisition cost over the fair value
of the Group's share of the identifiable net assets of the acquired subsidiary
at the date of acquisition.
Business combinations completed prior to date of transition to IFRS
The Group has elected not to apply IFRS3 Business Combinations retrospectively
to business combinations prior to the date of transition.
Accordingly the classification of the combination (merger) remains unchanged
from that used under UK GAAP. Assets and liabilities are recognised at date of
transition if they would be recognised under IFRS, and are measured using their
UK GAAP carrying amount immediately post-acquisition as deemed cost under IFRS,
unless IFRS requires fair value measurement. Deferred tax and minority interest
are adjusted for the impact of any consequential adjustments after taking
advantage of the transitional provisions.
Goodwill
Goodwill representing the excess of the cost of acquisition over the fair value
of the Group's share of the identifiable net assets acquired, is capitalised and
reviewed annually for impairment. Goodwill is carried at cost less accumulated
impairment losses. Negative goodwill is recognised immediately after acquisition
in the income statement.
Goodwill written off to reserves prior to date of transition to IFRS remains in
reserves. There is no re??instatement of goodwill that was amortised prior to
transition to IFRS. Goodwill previously written off to reserves is not written
back to profit or loss on subsequent disposal.
Revenue
Revenue is measured by reference to the fair value of consideration received or
receivable by the Group for services provided and the sale of investments,
excluding VAT and discounts. Revenue is recognised upon the performance of
services or transfer of risk to the customer.
Rendering of services
Services represent management fees excluding VAT.
When the outcome of a transaction involving the rendering of services can be
estimated reliably, revenue associated with the transaction is recognised by
reference to the stage of completion of the transaction at the balance sheet
date. The outcome of the transaction is deemed to be able to be estimated
reliably when all the following conditions are satisfied:
• the amount of revenue can be measured reliably
• it is probable that the economic benefits associated with the transaction
will flow to the entity
• the stage of completion of the transaction at the balance sheet date can be
measured reliably
• the costs incurred for the transaction and the costs to complete the
transaction can be measured reliably.
Where a contract involves delivery of several different elements and is not
fully delivered or performed by the year end, revenue is recognised based on the
proportion of the fair value of the elements delivered to the fair value of the
overall contract.
Rent receivable
Revenue includes rent receivable (excluding VAT) from third parties and is
recognised in the period to which the rental relates.
Sale of investments
Revenue from the sale of investments is recognised when all the following
conditions have been satisfied:
• the Group has transferred to the buyer the significant risks and rewards of
ownership of the investment which is generally when title has passed or an
unconditional contract for sale has been entered into.
• the Group retains neither continuing managerial involvement to the degree
usually associated with ownership nor effective control over the
investments which is generally when the beneficial ownership has
transferred to a third party.
• the amount of revenue can be measured reliably
• it is probable that the economic benefits associated with the transaction
will flow to the Group, and
• the costs incurred or to be incurred in respect of the transaction can be
measured reliably.
Interest
Interest is recognised using the effective interest method which calculates the
amortised cost of a financial asset and allocates the interest income over the
relevant period. The effective interest rate is the rate that exactly discounts
estimated future cash receipts through the expected life of the financial asset
to the net carrying amount of the financial asset.
Dividends
Dividends are recognised when the shareholders right to receive payment is
established.
Taxation
Current tax is the tax currently payable based on taxable profit for the period.
Deferred income taxes are calculated using the liability method on temporary
differences. Deferred tax is generally provided on the difference between the
carrying amounts of assets and liabilities and their tax bases. However,
deferred tax is not provided on the initial recognition of goodwill, nor on the
initial recognition of an asset or liability unless the related transaction is a
business combination or affects tax or accounting profit. Deferred tax on
temporary differences associated with shares in subsidiaries is not provided if
reversal of these temporary differences can be controlled by the Group and it is
probable that reversal will not occur in the foreseeable future. In addition,
tax losses available to be carried forward as well as other income tax credits
to the Group are assessed for recognition as deferred tax assets.
Deferred tax liabilities are provided in full, with no discounting. Deferred tax
assets are recognised to the extent that it is probable that the underlying
deductible temporary differences will be able to be offset against future
taxable income. Current and deferred tax assets and liabilities are calculated
at tax rates that are expected to apply to their respective period of
realisation, provided they are enacted or substantively enacted at the balance
sheet date.
Changes in deferred tax assets or liabilities are recognised as a component of
tax expense in the income statement, except where they relate to items that are
charged or credited directly to equity in which case the related deferred tax is
also charged or credited directly to equity.
Financial assets
Financial assets are divided into the following categories: loans and
receivables and financial assets at fair value through profit or loss. Financial
assets are assigned to the different categories by management on initial
recognition, depending on the purpose for which they were acquired. The
designation of financial assets is re-evaluated at every reporting date at which
a choice of classification or accounting treatment is available.
All financial assets are recognised when the Group becomes a party to the
contractual provisions of the instrument. Financial assets other than those
categorised as at fair value through profit or loss are recognised at fair value
plus transaction costs. Financial assets categorised as at fair value through
profit or loss are recognised initially at fair value with transaction costs
expensed through the income statement.
Financial assets at fair value through profit or loss include financial assets
that are either classified as held for trading or are designated by the entity
as at fair value through profit or loss upon initial recognition. Subsequent to
initial recognition, the financial assets included in this category are measured
at fair value with changes in fair value recognised in the income statement.
Financial assets originally designated as financial assets at fair value through
profit or loss may not be reclassified subsequently.
Financial assets are designated as at fair value through profit or loss where
they are managed and their performance evaluated on a fair value basis in
accordance with the Group's documented investment strategy.
Loans and receivables are non-derivative financial assets with fixed or
determinable payments that are not quoted in an active market. Trade receivables
and certain other current assets are classified as loans and receivables. Loans
and receivables are measured subsequent to initial recognition at amortised cost
using the effective interest method, less provision for impairment. Any change
in their value through impairment or reversal of impairment is recognised in the
income statement.
Provision against trade receivables is made when there is objective evidence
that the Group will not be able to collect all amounts due to it in accordance
with the original terms of those receivables. The amount of the write-down is
determined as the difference between the asset's carrying amount and the present
value of estimated future cash flows.
An assessment for impairment is undertaken at least at each balance sheet date.
A financial asset is derecognised only where the contractual rights to the cash
flows from the asset expire or the financial asset is transferred and that
transfer qualifies for derecognition. A financial asset is transferred if the
contractual rights to receive the cash flows of the asset have been transferred
or the Group retains the contractual rights to receive the cash flows of the
asset but assumes a contractual obligation to pay the cash flows to one or more
recipients. A financial asset that is transferred qualifies for derecognition if
the Group transfers substantially all the risks and rewards of ownership of the
asset, or if the Group neither retains nor transfers substantially all the risks
and rewards of ownership but does transfer control of that asset.
Financial liabilities
Financial liabilities are obligations to pay cash or other financial assets and
are recognised when the Group becomes a party to the contractual provisions of
the instrument. Financial liabilities are recorded initially at fair value, net
of direct issue costs.
They are recorded at amortised cost using the effective interest method, with
interest-related charges recognised as an expense in finance cost in the income
statement. Finance charges, including premiums payable on settlement or
redemption and direct issue costs, are charged to the income statement on an
accruals basis using the effective interest method and are added to the carrying
amount of the instrument to the extent that they are not settled in the period
in which they arise.
A financial liability is derecognised only when the obligation is extinguished,
that is, when the obligation is discharged or cancelled or expires.
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and demand deposits, together
with other short-term, highly liquid investments that are readily convertible
into known amounts of cash and which are subject to an insignificant risk of
changes in value.
Financial instruments and IFRS 1 - exemptions utilised by the Group
Designation of previously recognised financial instruments
The Group has elected to designate certain financial instruments at the date of
transition to IFRS as a financial asset or financial liability at fair value
through profit or loss.
Equity
Equity comprises the following:
• 'Share capital' represents the nominal value of equity shares.
• 'Share premium' represents the excess over nominal value of the fair value
of consideration received for equity shares, net of expenses of the share
issue.
• 'Profit and loss reserve' represents retained profits.
• 'Merger reserve' represents the excess of the nominal value of shares issued
in the acquisition of a subsidiary undertaking and the nominal value of
those shares.
Foreign currencies
Transactions in foreign currencies are translated at the exchange rate ruling at
the date of the transaction. Monetary assets and liabilities in foreign
currencies are translated at the rates of exchange ruling at the balance sheet
date. Non-monetary items that are measured at historical cost in a foreign
currency are translated at the exchange rate at the date of the transaction.
Non-monetary items that are measured at fair value in a foreign currency are
translated using the exchange rates at the date when the fair value was
determined.
Any exchange differences arising on the settlement of monetary items or on
translating monetary items at rates different from those at which they were
initially recorded are recognised in the profit or loss in the period in which
they arise. Exchange differences on non-monetary items are recognised in the
statement of changes in equity to the extent that they relate to a gain or loss
on that non-monetary item taken to the statement of recognised income and
expenses, otherwise such gains and losses are recognised in the income
statement.
3 Additions and disposals of investments
The following tables shows the significant additions and disposals of
investments.
Listed Listed Other Total
overseas Unlisted
investments
£'000 £'000 £'000 £'000
Carrying
amount at
1 January 2007 1,087 - 1,359 2,446
Disposals (115) - (114) (229)
Fair value 70 - (500) (430)
adjustments
Carrying 1,042 - 745 1,787
amount at
30 June 2007
Listed Listed Other Total
overseas unlisted
investments
£'000 £'000 £'000 £'000
Carrying 1,383 222 1,601 3,206
amount at - - 46 46
1 January 2006 (152) (43) - (195)
Additions (223) (68) (215) (506)
Disposals
Fair value
adjustments
Carrying 1,008 111 1,432 2,551
amount at
30 June 2006
Listed Listed Other Total
overseas Unlisted
investments
£'000 £'000 £'000 £'000
Carrying amount 1,383 222 1,601 3,206
at 1 January 2006 - - 46 46
Additions (69) (82) (67) (218)
Disposals (227) (140) (221) (588)
Fair value
adjustments
Carrying amount
at
31 December 2006 1,087 - 1,359 2,446
4 Basic and diluted loss per share from total and continuing operations
The calculation of the basic loss per share is based on the losses attributable
to ordinary shareholders divided by the weighted average number of shares in
issue during the period.
The losses and weighted average number of shares used in the calculations are
set out below.
6 months to 30 June 2007
Losses attributable to £(435,000)
ordinary shareholders
----------------------------
Weighted average number of 10,603,835
shares
----------------------------
Basic loss per share (4.10)p
========
========
========
=
6 months to 30 June 2006
Losses attributable to £(759,000)
ordinary shareholders
----------------------------------
Weighted average number of 10,460,000
shares
----------------------------
Basic loss per share (7.26)p
=========================
Year ended 31 December 2006
Losses attributable to £(912,000)
ordinary shareholders
----------------------------
Weighted average number of 10,524,035
shares
----------------------------
Basic earnings per share (8.67)p
========
========
========
=
There is no difference between basic and diluted loss per share.
5 Explanation of transition to IFRS
As stated in the Basis of Preparation, these are the Group's first condensed
consolidated interim financial statements for part of the period covered by the
first IFRS annual consolidated financial statements prepared in accordance with
IFRS.
An explanation of how the transition from UK GAAP to IFRS has affected the
Group's financial position, financial performance and cash flows is set out
below.
IFRS permits groups adopting IFRS for the first time to take certain exemptions
from the full requirements of IFRS in the transition period. These interim
financial statements have been prepared on the basis of taking the following
exemptions:
• business combinations prior to 1 January 2006, the Group's date of
transition to IFRS, have not been restated to comply with IFRS 3 'Business
Combinations'.
• the Group has elected to designate certain financial instruments at the
date of transition to IFRS as a financial asset or financial liability at fair
value through profit and loss.
Notes to the reconciliations
The Group has applied IAS 39; Financial instruments: Recognition and Measurement
to certain loan agreements as follows:
a) An interest free loan from Billam AG. The loan was previously included under
UK GAAP at the value of the proceeds of the loan. This has now been shown on
initial recognition at fair value and recorded at amortised cost on subsequent
measurement.
b) Borrowings with rights to convert to shares. Historically, not being
material, the loan was accounted for as a debt instrument under UK GAAP. On
conversion, as the instrument has increased in value as a result of piecemeal
advances to the company, the instrument has been split between debt and equity
with the equity element of the convertible loan calculated by discounting the
liability to its net present value . The loan is then decreased to the
settlement value over the period of the loan with the net interest debited to
the income statement and a corresponding increase in the loan.
c) An interest free loan with a former director. The loan was previously
included at the value of the proceeds of the loan. This has now been shown on
initial recognition at fair value and recorded at amortised cost on subsequent
measurement.
d) The reclassification to financial assets at fair value through profit and
loss on transition of an amount previously included in current assets.
Reconciliation of equity at 1 January 2006
Note
UK GAAP a d IFRS
£'000 £'000 £'000 £'000
Non-current assets
Financial assets at fair value 3,106 - 100 3,206
through profit and loss
Current assets
Trade and other receivables 121 - (100) 21
Other current assets 50 - - 50
Cash and cash equivalents 9 - - 9
Current
liabilities
Trade and (205) - - (205)
other
payables
Short-term (54) - - (54)
borrowings
Non-current
assets
Long-term (397) 157 - (240)
borrowings
Other (475) - - (475)
payables
------------------------- ------------------------- ----------------
Net assets 2,155 157 - 2,312
========================= ========================= ================
Equity
Share 2,250 - - 2,250
capital
Share 5,409 - - 5,409
premium
account
Merger 1,012 - - 1,012
reserve
Profit and (6,516) 157 - (6,359)
loss
account
------------------------- ------------------------- ----------------
Total 2,155 157 - 2,312
equity
========================= ========================= ================
Reconciliation of equity at 30 June 2006
Note
UK GAAP a b c d IFRS
£'000 £'000 £'000 £'000 £'000 £'000
Non-current assets
Financial assets 2,451 - - - 100 2,551
at fair value
through profit and
loss
Current assets
Trade and other 230 - - - (100) 130
receivables
Cash and cash 11 - - - 11
equivalents
Current
liabilities
Trade and (420) - - 34 - (386)
other
payables
Short-term (201) - 8 - - (193)
borrowings
Non-current
assets
Long-term (397) 117 - - - (280)
borrowings
Other (271) - - - - (271)
payables
Net assets 1,403 117 8 34 - 1,562
Equity
Share 2,250 - - - - 2,250
capital
Share 5,409 - - - - 5,409
premium
account
Convertible - - 9 - - 9
loan
Merger 1,012 - - - - 1,012
reserve
Profit and (7,268) 117 (1) 34 - (7,118)
loss
account
Total 1,403 117 8 34 - 1,562
equity
Reconciliation of equity at 1 January 2007
Note
UK GAAP a b c IFRS
£'000 £'000 £'000 £'000 £'000
Non-current assets
Financial assets 2,446 - - - 2,446
at fair value
through profit and
loss
Current assets
Trade and other 121 - - - 121
receivables
Other current 50 - - - 50
assets
Cash and cash 1 - - - 1
equivalents
Current
liabilities
Trade and (379) - - 27 (352)
other
payables
Short-term (366) - 13 - (353)
borrowings
Non-current
assets
Long-term (397) 115 - - (282)
borrowings
Other (170) - - - (170)
payables
Net assets 1,306 115 13 27 1,461
Equity
Share 2,279 - - - 2,279
capital
Share 5,423 - - - 5,423
premium
account
Convertible - - 18 - 18
loan
Merger 1,012 - - - 1,012
reserve
Profit and (7,408) 115 (5) 27 (7,271)
loss
account
Total 1,306 115 13 27 1,461
equity
Reconciliation of profit for the 6 months ended 30 June 2006
Note
UK GAAP a b c IFRS
£'000 £'000 £'000 £'000 £'000
Continuing
operations 42 - - - 42
Revenue
Losses on (530) - - - (530)
investments
Gross loss (488) - - - (488)
Administrative (262) - - - (262)
costs
Finance costs (3) (2) (1) (3) (9)
Loss before (753) (2) (1) (3) (759)
tax
Income tax - - - - -
expense
Loss after tax (753) (2) (1) (3) (759)
Reconciliation of profit for the year to 31 December 2006
Note
UK GAAP a b c FRS
£'000 £'000 £'000 £'000 £'000
Continuing
operations
Revenue 86 - - - 86
Cost of sales (454) - - - (454)
Gross loss (368) - - - (368)
Administrative (513) - - - (515)
costs
Finance costs (11) (3) (5) (10) (29)
Loss before (892) (3) (5) (10) (912)
tax
Income tax -
expense
Loss after tax (892) (3) (5) (10) (912)
COMPANY INFORMATION
The company is a public limited company registered in England and Wales. The
registered office and principal place of business is Trinity Court, Batchworth
Island, Church Street, Rickmansworth, Hertfordshire, WD3 1RT
This information is provided by RNS
The company news service from the London Stock Exchange
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