Interim Results

RNS Number : 4504F

Ebiquity PLC

13 January 2010

 



Ebiquity Plc

Interim Results for the six months ended 31 October 2009

13 January 2010

Investing in and driving growth

Ebiquity plc, the media and marketing analytics business, announces interims results for the 6 months ended 31 October 2009. Ebiquity provides services to 70% of the top 100 UK advertisers and represents over 400 clients in up to 40 countries. 

Key points

• Rapid international expansion driving revenue growth 
• US business continuing to perform strongly
• Advertising monitoring renewal rate firm
• Newslive progressing well, now accounts for 11% of Platform revenue (2008: 6%)

Financials

• Group revenues increased by 8% to £9.3m (H1 2009: £8.6m)
• Analytics revenue increased 15% to £6.7m (H1 2009: £5.8m)
• International assignments now account for 36% of Group revenue (2008: 28%)
• Group underlying* operating profit of £760,000 (2008: £921,000)
• Group underlying* operating profit excluding foreign exchange gains/losses £984,000 (2008: £744,000)
• Strong cash generation with net cash from operating activities of £895,000 (2008: £111,000)
• Reported profit before tax of £202,000 (2008: £296,000)
• Basic EPS of 1.06p (2008: 0.29p)
• Underlying diluted EPS of 1.71p (2008: 2.03p)

* before Highlighted Items (see note 2)

Michael Greenlees, Chief Executive, said:

"This has been a period of significant progress with our international business developing well and our investment in our core products and new revenue streams delivering good results.  

Looking further ahead I believe we can expect to see the current positive trends continue as advertisers seek out data-driven solutions designed to improve their media and business performance. We remain confident that our financial goals are both realistic and achievable."

  Enquiries:

Ebiquity	020 7650 9600
Michael Greenlees, CEO
Andrew Beach, CFO
College Hill	020 7457 2020
Matthew Smallwood
Jamie Ramsay
Numis Securities	020 7260 1000
Nick Westlake (NOMAD)
David Poutney (Corporate Broker)

Notes to Editors

Ebiquity plc is in the business of media and marketing analytics. 

Founded in 1997, Ebiquity provides marketing professionals with a wide range of data driven systems that help to achieve their clients' business and brand objectives.

Floated on AIM in April 2000, Ebiquity is now used by 70% of the top 100 UK advertisers and has recently opened offices in Germany, France and Spain to add to its global presence.

For further information please visit: www.ebiquity.com 

Chief Executive's Statement 

Overview 

We can once again report significant progress across the Company for the half year to 31 October 2009.

Revenues were up 7.8% to £9.26 million compared to prior year. Underlying operating profit (pre highlighted items) is £760,000, modestly ahead of market expectation. Excluding foreign exchange movements on intercompany loans, these profits increased by 32% to £984,000. 

Reported operating profits have fallen to £270,000 (2008: £427,000), negatively influenced by the currency fluctuations.

First half performance has been driven largely by the continuing success in winning international contracts, and the growing importance of our US business, based in New York. 

Underlying diluted EPS fell slightly to 1.71p compared to 2.03p for the same period last year, reflecting the currency fluctuations.  Reported diluted EPS increased from 0.28p to 0.97p.

Analytics International Business Expansion

Our year began well with the confirmation of a number of new international contracts from our growing number of global clients. This trend looks set to continue. In the US in particular, our business has shown significant growth as US advertisers increasingly recognise the importance of media evaluation, benchmarking and optimisation as a means to improving both value and performance.

Overall our international revenue increased by 40% and now represents 51% of revenues derived from the Analytics division.

As I mentioned in my last report to shareholders, we continue to invest in our international development. In December we created a French office in Paris, which joins our recently opened German and Spanish businesses. This represents the next step in our objective of building a strong European network with offices in key European and international media markets.

Platform division

As I mentioned in my last report, the Platform division overall has felt the greatest impact from the more difficult economic environment and revenues are down 9.6% largely as a result of a softening in demand for advertising monitoring. That said we have achieved good traction for Newslive 2.0, which we expect to account for a growing proportion of our UK media monitoring sales.

Despite softening revenues, our ability to effectively manage costs has meant that overall our gross margins from this division have continued to improve.

 Outlook

Notwithstanding the difficult economic environment, the business continues to show good growth. 

The recent Forrester Report* argued that the next generation of marketing professionals will come primarily from the data led disciplines, and that the future of marketing will lie with "the people who can collect data, scrutinise it and use it for their commercial gain". This vision lies at the core of the Ebiquity growth strategy.

Our growing reputation as the best practice provider of marketing and media data analytics is reflected in the increased number of client assignments which we have won both domestically and internationally, and in the growth of our overseas offices. 

Whilst trading conditions appear difficult, looking ahead the Board believe that we can expect to see the current positive trends continue as advertisers seek out data driven, independent and informed advice, designed to improve their media and business performance.

Michael Greenlees

Chief Executive Officer

* The Intelligent Approach to Consumer Intelligence: A Framework for Turning Customer Data into Smart Business Strategy, 16 October 2009 

  Financial Review

Ebiquity plc is publishing its interim results for the 6 months ended 31 October 2009.  

Introduction to segmental reporting presentation

From financial years commencing on or after 1 January 2009, companies that comply with IFRS are required to follow new guidelines in relation to the reporting of their segmental results (in accordance with IFRS8, Operating Segments). Since this new standard is applicable to our current financial year, we have chosen to present this interim Financial Review in accordance with these new requirements. 

Revenue

	6 months ended 31 October 2009	6 months ended 31 October 2008		12 months ended 30 April 2009
	£'000	£'000		£'000
Analytics	6,660	5,773		12,842
Platform	2,600	2,875		5,633
Intersegment elimination	-	(56)		(56)
Total Revenue	9,260	8,592		18,419

Our "Analytics" division consists of our media auditing, consultancy and marketing effectiveness practices and our "Platform" division consists of advertising and editorial monitoring and publisher services. The only impact on our reporting of revenue under the new segmental guidelines is the addition of an intersegment eliminations line, whereby the revenue is initially shown on a gross basis. During the current period there has been no intersegment revenues.

Total Group revenue increased by 7.8% to £9.3 million (2008: £8.6 million). This growth was driven by the Analytics division where revenue increased by 15.4% to £6.7 million, and now represents 72% of total Group revenue (2008: 67%). 

Within this division, revenue from international audit assignments (defined as non UK sourced revenue, or UK sourced revenue where marketing activity is analysed in more than one country) grew by 40% to £3.4m, with much of the increase coming from our US office.

Revenue from the smaller Platform division was down 9.6%. This was due to a softening in the advertising monitoring renewal rate (by value) to 74% (2008: 85%) and a slow down in new sales of our advertising monitoring platform.  Offsetting this, Newslive, our editorial monitoring platform recently relaunched as Newslive 2.0, has seen good sales traction and now accounts for 11% of this division's revenue (2008: 6%). 

 Gross Profit

Gross profit for the period was up 8.4% to £4.8m (2008: £4.4m), yielding an improved gross margin of 52% (2008: 51%).  

The Analytics gross profit has improved from £2.9m to £3.5m, with margins increasing from 51% to 52%. The margin increase principally reflects the uplift in revenues together with effective management of staff costs. Our US office in particular has increased its revenue significantly on little increased headcount.

The Platform gross profit has reduced slightly, from £1.5m to £1.3m, with margins remaining consistent at 51%. Whilst we have seen a fall in revenue from our advertising monitoring platform, we have been successful in reducing our operating costs to ensure that there has been no impact on gross margin. The improved performance from Newslive 2.0, together with improved operational efficiencies, has resulted in an improvement in margin from news monitoring. 

Operating Profit

Profit before highlighted items is termed "underlying operating profit". Certain items have been highlighted because separate disclosure is considered relevant in understanding the underlying performance of the business.  

	6 months ended 31 October 2009	6 months ended 31 October 2008		12 months ended 30 April 2009
	£'000	£'000		£'000
Analytics	3,057	2,481		6,017
Platform	595	589		1,296
Unallocated administrative expenses excluding impact of foreign exchange movements	(2,668)	(2,326)		(5,242)
Underlying operating profit excluding impact of foreign exchange movements	984	744		2,071
Impact of foreign exchange movements	(224)	177		292
Underlying operating profit	760	921		2,363
Highlighted Items	(490)	(494)		(933)
Reported operating profit	270	427		1,430

Underlying operating profit for the period has fallen from £921,000 to £760,000, despite an improvement in underlying trading performance. 

During the period, foreign exchange losses reduced underlying operating profit by £224,000.  This compares to a gain in the same period last year of £177,000. These foreign exchange movements were predominately generated by the US dollar loan to our US subsidiary, Billetts America LLC (totalling $1.7m). Excluding these foreign exchange movements, the underlying operating profit shows an improvement of 32%, from £744,000 to £984,000.

To avoid a similar level of foreign exchange movements in the second half of the year we have established a hedge by translating our UK term loan into a US dollar denominated loan. The foreign exchange loss of £224,000 predominantly represents the loss for the period between 1 May 2009 and the date that we translated our UK loan to US dollars.

Our Analytics division has continued to perform well with increased revenues from a well managed cost base. At the gross profit level, we have seen an increase of £504,000 as explained above. Administrative expenses have decreased by £72,000, resulting in an increase at operating profit level of £576,000.

Our Platform division has performed less well, but has demonstrated effective cost reduction as a result of reduced revenues. At the gross profit level, we have seen a decrease of £135,000 as explained above. Administrative expenses have decreased by £141,000 due to effective cost management, resulting in a small increase at the operating profit level of £6,000.

Unallocated administrative expenses predominantly represent central salaries (Board, Finance, IT and HR), property costs, foreign exchange movements, and central legal and advisory costs. Under previous IFRS segmental reporting, the majority of these costs were allocated to the divisions. Unallocated administrative expenses, including foreign exchange movements, have increased by £742,000. The majority of this represents the movement on foreign exchange explained above (£401,000 movement). The remainder of the increase relates to increased property and staff costs, and a reduction in the amount of development costs capitalised.

Highlighted Items

Highlighted items comprise significant non-cash charges and non-recurring items which are highlighted in the income statement because separate disclosure is considered relevant in understanding the underlying performance of the business.

	6 months ended 31 October 2009			6 months ended 31 October 2008				12 months ended 30 April 2009
	Cash	Non-cash	Total	Cash	Non-cash		Total	Total
	£'000	£'000	£'000	£'000	£'000	£'000			£'000
Recurring:
Share based expenses	-	151	151	-	152	152			313
Amortisation of purchased intangibles	-	181	181	-	181	181			362
	-	332	332	-	333	333			675
Non recurring:
Management restructuring	158	-	158	161	-	161			258
	158	-	158	161	-	161			258
Total highlighted items	158	332	490	161	333	494			933

The management restructuring costs of £158,000 relate to the implementation of the final stages of the previously announced strategic review.

Profit before Tax and EPS

	6 months ended 31 October 2009	6 months ended 31 October 2008		12 months ended 30 April 2009
	£'000	£'000		£'000
Reported operating profit	270	427		1,430
Net finance costs	(67)	(131)		(243)
Share of loss of associates	(1)	-		(14)
Profit before tax	202	296		1,173

Net finance costs for the period were down to £67,000 (2008: £131,000) which reflects a reduced gross debt level.

The share of loss from associates represents our share of the losses of Billetts Germany GmbH, a company in which we have a 10% stake.

Underlying profit before tax was down 12% to £692,000 (2008: £790,000). Excluding foreign exchange movements, underlying profit before tax is up 49% to £916,000 (2008: £613,000). Reported profit before tax is £202,000 (2008: £296,000).

Reported diluted earnings per share was 0.97p (2008: 0.28p). Underlying diluted earnings per share was 1.71p (2008: 2.03p). During the period a number of outstanding share options were modified to adjust the exercise price downwards. This, together with an increased share price over the period, has resulted in more shares potentially being exercisable which has resulted in a large deferred tax adjustment. This has resulted in an increase in the reported diluted earnings per share. The underlying diluted earnings per share, which removes the impact of the deferred tax adjustment, has fallen since the number of shares that are potentially dilutive has increased following the modification and share price increase.

Consistent with prior periods, the Board is not currently recommending the payment of a dividend.

Operating Cashflow and Net Debt

	31 October 2009 £'000	31 October 2008   £'000	30 April 2009  £'000
Net cash from operating activities	895	111	827
Cash	1,521	1,277	1,246
Loans to associates	310	-	362
Debt	(3,314)	(4,000)	(3,800)
Net Debt	(1,483)	(2,723)	(2,192)

Net cash from operating activities for the period was £0.9m (2008: £0.1m), predominantly reflecting an improvement in working capital (£332,000 movement), a positive movement in tax payments (£223,000), and lower interest payments due to the reducing debt position (£72,000).

We have continued to place significant emphasis on cash generation and collections. As a result, debtor days have again reduced and now stand at 54 days, down from 62 days at the end of April 2009 and October 2008. Debts greater than 60 days overdue continue to remain comfortably under 10% of the total debtors balance.

Loans to associates reflect loans made to Billetts Germany GmbH. The full balance is repayable on demand.

Gross debt has reduced by approximately £0.5m since April 2009 following scheduled repayments of the term loan and revolving credit facility. The net debt position has improved by approximately £0.7m since April 2009 due to the improvement in net cash from operating activities, and reduced capital expenditure compared to recent periods. 

The Group continues to trade comfortably within all of its banking facilities and covenants.  

Andrew Beach 

Chief Financial Officer

Consolidated Income Statement

for the six months ended 31 October 2009

		Unaudited  6 months ended 31 October 2009	Unaudited  6 months ended  31 October 2008	Audited 12 months ended  30 April  2009
	Note	£'000s	£'000s	£'000s
Revenue		9,260	8,592	18,419
Cost of Sales		(4,479)	(4,180)	(8,574)
Gross Profit		4,781	4,412	9,845
Administrative expenses - excluding highlighted items		(4,021)	(3,491)	(7,482)
Administrative expenses - highlighted items	2	(490)	(494)	(933)
Total administrative expenses		(4,511)	(3,985)	(8,415)
Operating profit before highlighted items		760	921	2,363
Administrative expenses - highlighted items		(490)	(494)	(933)
Operating profit		270	427	1,430
Finance income		8	16	25
Finance expenses		(75)	(147)	(268)
Net finance costs		(67)	(131)	(243)
Share of loss of associates		(1)	-	(14)
Profit before taxation		202	296	1,173
Tax income/(expense)		144	(203)	(1,084)
Profit for the period		346	93	89
Attributable to:
Equity holders of the parent		341	93	87
Minority interests		5	-	2
		346	93	89
Earnings per share
Basic	4	1.06p	0.29p	0.27p
Diluted	4	0.97p	0.28p	0.26p

  Consolidated Statement of Comprehensive Income

for the six months ended 31 October 2009

	Unaudited 6 months ended 31 October 2009	Unaudited  6 months ended 31 October 2008	Audited   12 months ended 30 April  2009
	£'000	£'000	£'000
Profit for the period	346	93	89
Exchange differences on translation of overseas subsidiary	73	(139)	(180)
Total comprehensive income for the period	419	(46)	(91)
Attributable to:
Equity holders of the parent	414	(46)	(93)
Minority interest	5	-	2
	419	(46)	(91)

  Consolidated Statement of financial position

as at 31 October 2009

		Unaudited as at 31 October 2009	Unaudited as at 31 October 2008	Audited as at 30 April 2009
	Note	£'000s	£'000s	£'000s
Non current assets
Goodwill		8,754	8,754	8,754
Other intangible assets	5	2,638	3,089	2,795
Property, plant & equipment		872	1,051	971
Investment in Joint Ventures		115	115	115
Investment in associates		17	-	17
Loans and other financial assets		77	-	77
Deferred tax asset		322	832	142
Total non current assets		12,795	13,841	12,871
Current assets
Trade & other receivables		5,553	6,130	5,932
Cash & cash equivalents		1,521	1,277	1,246
Loans and other financial assets		310	-	362
Total current assets		7,384	7,407	7,540
Total Assets		20,179	21,248	20,411
Current liabilities
Other financial liabilities		(2,300)	(2,400)	(2,513)
Trade & other payables		(1,638)	(2,503)	(1,852)
Current tax liabilities		(498)	(215)	(306)
Provisions		(124)	(136)	(51)
Accruals & deferred income		(4,049)	(4,428)	(4,266)
Total current liabilities		(8,609)	(9,682)	(8,988)
Non current liabilities
Other financial liabilities		(1,058)	(1,600)	(1,332)
Provisions		-	(39)	(99)
Deferred tax liability		(515)	(615)	(565)
Total non current liabilities		(1,573)	(2,254)	(1,996)
Total liabilities		(10,182)	(11,936)	(10,984)
Total net assets		9,997	9,312	9,427
Capital & Reserves
Share capital		8,035	8,035	8,035
Share premium		1,846	1,846	1,846
Merger reserve		(4,504)	(4,504)	(4,504)
Translation reserve		(44)	(76)	(117)
Retained earnings		4,664	4,011	4,167
Capital and reserves attributable to the equity holder of the parent		9,997	9,312	9,427
Minority interest		-	-	-
Total Equity		9,997	9,312	9,427

  Consolidated Statement of Cashflows 

for the six months ended 31 October 2009

	Unaudited  6 months  ended  31 October  2009	Unaudited 6 months ended 31 October 2008	Audited 12 months ended 30 April 2009
	£'000s	£'000s	£'000s
Cashflows from operating activities
Profit before taxation	202	296	1,173
Adjustments for:
Depreciation	166	175	364
Amortisation	264	241	487
Capitalised development costs write off	-	-	106
Foreign exchange loss/(gain) on inter-company balances	132	(169)	(298)
Share option charges	151	152	313
Finance income	(8)	(16)	(25)
Finance expense	75	147	268
Call/put options valuation (net)	-	-	(6)
Share of loss of associates	1	-	14
	983	826	2,396
Decrease/(increase) in trade receivables	310	(322)	(10)
Decrease in trade payables	(402)	(83)	(951)
Decrease in provisions	(26)	(45)	(71)
Cash generated from operations	865	376	1,364
Finance expense	(75)	(147)	(268)
Income taxes (paid)/refunded	105	(118)	(269)
Net cash from operating activities	895	111	827
Cashflows from investing activities
Purchase of property, plant & equipment	(70)	(341)	(454)
Purchase of intangible assets	(107)	(454)	(511)
Purchase of investments	-	-	(26)
Purchase of investments in associates	-	-	(17)
Grant of loan to associates	-	-	(362)
Repayment of loan from associates	52	-	-
Finance income	8	16	25
Net cash used in investing activities	(117)	(779)	(1,345)
Cashflows from financing activities
Proceeds from long term borrowings	-	500	1,113
Repayment of bank loans	(486)	(200)	(1,013)
Loan note settlement	-	(51)	(51)
Net cashflow used in financing activities	(486)	249	49
Net increase/(decrease) in cash, cash equivalents and bank overdrafts	292	(419)	(469)
Effect of foreign exchange rate changes	(17)	9	28
Cash, cash equivalents and bank overdrafts at beginning of period	1,246	1,687	1,687
Cash, cash equivalents and bank  overdrafts at end of period	1,521	1,277	1,246

1. Accounting policies

Basis of preparation

The financial information presented in this documentation has been prepared using recognition and measurement principles which are consistent with International Financial Reporting Standards (IFRS) and International Financial Reporting Interpretations Committee (IFRIC) interpretations that are expected to be applicable for the period ending 30 April 2010. These are subject to ongoing review and endorsement by the European Commission, or possible amendment by the International Accounting Standards Board (IASB), and are therefore subject to possible change. Further standards or interpretations may also be issued that could be applicable for the year ending 30 April 2010. These potential changes could result in the need to change the basis of accounting or presentation of certain financial information from that presented in this document.

The comparatives for the period ended 30 April 2009 are not the Company's full statutory accounts for that year but are drawn up from those accounts. A copy of the statutory accounts for that year has been delivered to the Registrar of Companies. The auditors' report on those accounts was unqualified, did not include references to any matters to which the auditors drew attention by way of emphasis without qualifying their report and did not contain a statement under section 498(2)-(3) of the Companies Act 2006.

As permitted, the group has not applied IAS 34 'Interim Reporting' in preparing this interim report.

IAS1 (Revised) Presentation of Financial Statements applicable to annual periods commencing on or after 1 January 2009 have been applied to this interim report.

2. Highlighted items

Highlighted items comprise significant non-cash charges and non-recurring items which are highlighted in the income statement because separate disclosure is considered relevant in understanding the underlying performance of the business.

	Unaudited  6 months ended 31 October 2009	Unaudited  6 months ended 31 October 2008	Audited 12 months ended 30 April 2009
	£'000s	£'000s	£'000s
Recurring:
Share based expenses	151	152	313
Amortisation of purchased intangible assets	181	181	362
	332	333	675
Non recurring:
Management restructuring costs	158	161	258
	158	161	258
Total highlighted items	490	494	933

The management restructuring costs of £158,000 relate to the implementation of the final stages of the previously announced strategic review.

3. Dividends

No interim dividend is being proposed.

4. Earnings per share

The calculation of basic and diluted earnings per share is based on the following data:

	Unaudited 6 months ended 31 October 2009			Unaudited 6 months ended 31 October 2008	Audited 12 months ended 30 April 2009
	£'000s			£'000s	£'000s
Earning for the purpose of basic earnings per share being net profit attributable to equity holders of the parent	341			93	87
Adjustments:
Highlighted items - recurring*	332			333	675
Highlighted items - non recurring*		158		161	258
Deferred tax	(231)			96	735
Earnings for the purpose of underlying earnings per share	600			683	1,755
Number of shares
Weighted average number of ordinary shares for the purpose of basic earnings per share	32,139,435			32,139,435	32,139,435
Effect of dilutive potential ordinary shares
Share options	2,912,119			1,530,912	1,082,978
Weighted average number of ordinary shares for the purpose of diluted earnings per share	35,051,554			33,670,347	33,222,413
Basic earnings per share	1.06p			0.29p	0.27p
Diluted earnings per share**			0.97p	0.28p	0.26p
Underlying basic earnings per share			1.87p	2.12p	5.46p
Underlying diluted earnings per share			1.71p	2.03p	5.28p

* Highlighted items (see note 2).

  ** Note that certain share options have been excluded from the calculation of diluted EPS as their exercise price is greater than the average share price during the period (i.e. they are out-of-the-money) and therefore it would not be advantageous for the holders to exercise those options. 34,239 (October 2008: 1,524,583) share options have not been included within the diluted earnings per share calculations at 31 October 2009 as they are anti-dilutive for the periods presented. These shares could potentially dilute the earnings per share in the future.  

5. Other intangible assets 

	Capitalised development costs	Purchased intangible assets	Total intangible assets
	£'000s	£'000s	£'000s
Cost
At 1 May 2009	952	3,395	4,347
Additions	107	-	107
At 31 October 2009	1,059	3,395	4,454
Amortisation
At 1 May 2009	(176)	(1,376)	(1,552)
Provision for the period	(83)	(181)	(264)
At 31 October 2009	(259)	(1,557)	(1,816)
Net book value
At 31 October 2009	800	1,838	2,638
At 31 October 2008	889	2,200	3,089

The capitalised development costs are internally generated.

Amortisation is charged within administrative expenses so as to write off the cost of the purchased intangible assets over their estimated useful lives. The assets, initial values and periods used are as follows:

Purchased intangibles	Cost  at acquisition £'000s	Current carrying value £'000s	Useful economic life Years	Remaining period of amortisation Years
Media Consulting Customer relationships	2,859	1,668	10	5.8
Marketing Sciences Customer relationships	271	45	5	0.8
MPMA Customer relationships	43	-	2	-
Trade name	215	125	10	5.8
Non-compete	7	-	1.5	-
	3,395	1,838

  INDEPENDENT REVIEW REPORT TO EBIQUITY 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, the Consolidated Statement of Comprehensive Income, 

the Consolidated Balance Sheet, the Consolidated Cashflow Statement and related notes.

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.

Directors' responsibilities

The interim report, including the financial information contained therein, is the responsibility of and has been approved by the directors. The directors are responsible for preparing the interim report in accordance with the rules of the London Stock Exchange for companies trading securities on the Alternative Investment Market which require that the half-yearly report be presented and prepared in a form consistent with that which will be adopted in the company's annual accounts having regard to the accounting standards applicable to such annual accounts.

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.

Our report has been prepared in accordance with the terms of our engagement to assist the company in meeting the requirements of the rules of the London Stock Exchange for companies trading securities on the Alternative Investment Market and for no other purpose. No person is entitled to rely on this report unless such a person is a person entitled to rely upon this report by virtue of and for the purpose of our terms of engagement or has been expressly authorised to do so by our prior written consent. Save as above, we do not accept responsibility for this report to any other person or for any other purpose and we hereby expressly disclaim any and all such liability

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 financial statements 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 rules of the London Stock Exchange for companies trading securities on the Alternative Investment Market.

BDO LLP

Chartered Accountants and Registered Auditors

55 Baker Street

London W1U 7EU

13 January 2010

 

END

 

 

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