Final Results

RNS Number : 5117G

Highway Capital PLC

29 June 2012

HIGHWAY CAPITAL PLC

AUDITED RESULTS FOR THE YEAR ENDED 29 FEBRUARY 2012

Chairman's statement

Results for 12 months ended 29 February 2012 show a loss before tax of £93,105 (2011: £92,933 loss).

The company had cash in the bank and in hand of £136,199 at the balance sheet date. The board does not consider it appropriate to declare a dividend.

At the last AGM, Mr Drummon, the previous Chairman, indicated that he was pleased the three largest shareholders, Mr Rowan (29.9%), Mr Szytko (28.8%) and myself (4.98%), were all present, as the existing structure, with two shareholders each holding in excess of 25% meant that the board's hands were tied, as any proposals needed both of these parties to be in agreement.

Following the meeting the board invited Messrs Rowan, Szytko and myself to join the board. Whilst Mr Rowan declined to do so, Mr Szytko and I agreed to do so and were appointed on 19 September 2011, and following this restructuring Mr Drummon and Mr Perloff resigned from the board.

Since his resignation in September 2011 the company has been informed that Howard Drummon has sadly passed away and the company extends its condolences to his family.

The board has continued to explore opportunities to increase shareholders' value, unfortunately, none has yet proved suitable. We will continue to work with both major shareholders to identify an acceptable target and will inform you of any developments.

D M D A Wheatley

Chairman

Directors' responsibility statement

Company law requires the directors to prepare accounts for each financial year which give a true and fair view of the state of affairs of the company and of the profit or loss for that period. In preparing those accounts, the directors are required to:

- select suitable accounting policies and then apply them consistently;

- make judgements and estimates that are reasonable and prudent;

- follow applicable accounting standards, subject to any material departures disclosed and explained in the accounts; and

- prepare the accounts on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for maintaining proper accounting records which disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the accounts comply with the Companies Act 2006. They are responsible for the system of internal control, and for taking such steps as are reasonably open to them to safeguard the assets of the company and to prevent and detect fraud and other irregularities. The directors are also responsible for ensuring that all information relevant to the audit has been made available to the auditors.

Under applicable law and regulations, the directors are also responsible for preparing a directors' report, directors' remuneration report and corporate governance statement that comply with that law and those regulations.

The directors confirm that, to the best of their knowledge and belief:

- the accounts in this document, prepared in accordance with applicable UK law and accounting

standards, give a true and fair view of the assets, liabilities, financial position and loss of the company; and

- the business review and management report in the directors' report includes a fair review of the

development and performance of the business and the position of the company, together with a description of the principal risks and uncertainties that it faces.

Profit and loss account

Year ended 29 February 2012

	Notes	2012	2011
Management fees Other income Administrative expenses		- - (93,802)	- - (93,371)
Operating loss Interest receivable	2	(93,802) 697	(93,371) 438
Loss on ordinary activities before taxation Tax credit on loss on ordinary activities	5	(93,105) -	(92,933) -
Loss for the financial year		(93,105)	(92,933)
Basic and diluted loss per share	7	(1.17)p	(1.17)p
Basic and diluted loss per share from continuing operations	7	(1.17)p	(1.17)p

Continuing operations

There are no acquired or discontinued operations in the above two financial periods.

Total recognised gains and losses

The company has no recognised gains or losses other than the profit or loss for the above two financial periods.

Reconciliation of equity shareholders' funds

	2012	2011
Loss attributable to ordinary shareholders	(93,105)	(92,933)
Dividends	-	-
Net decrease in shareholders' funds	(93,105)	(92,933)
Shareholders' funds at 1 March 2011	210,623	303,556
Shareholder's funds at 29 February 2012	£117,518	£210,623

Balance sheet

at 29 February 2012

	Notes	2012	2011
Fixed assets
Investments	8	-	-
		-	-
Current assets
Debtors	10	4,049	3,631
Cash at bank and in hand		136,199	228,847
		140,248	232,478
Creditors: amounts falling due within one year	11	(22,730)	(21,855)
Net current assets		117,518	210,623
Net assets		£117,518	£210,623
Capital and reserves
Share capital	14	158,913	158,913
Share premium	16	295,437	295,437
Profit and loss account	16	(336,832)	(243,727)
Total equity shareholders' funds		£117,518	£210,623

Cash flow statement

Year ended 29 February 2012

Notes 2012 2011

Net cash outflow from operating

activities 20(a) (93,345) (93,663)

Returns on investments and servicing of finance

Interest received 697 438

Net cash inflow from returns on

investments and servicing of finance 697 438

Taxation

Corporation tax - -

Equity dividends paid - -

Decrease in cash 20(b) £(92,648) £(93,225)

Notes to the accounts

Year ended 29 February 2012

1. Accounting Policies

Basis of accounting

The accounts have been prepared under the historical cost convention and in accordance with applicable accounting standards.

Highway Capital plc does not prepare consolidated accounts and the directors have therefore continued to prepare its accounts in accordance with UK rather than international accounting standards, as permitted under EC Regulation 1606/2002.

Going concern

After reviewing the company's budget for 2012/2013 and its medium term plans, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. For this reason, they continue to adopt the going concern basis in preparing the accounts.

Consolidation

At 29 February 2012, Highway Capital plc was a stand-alone company and is therefore not required to prepare consolidated accounts.

Depreciation

Depreciation is provided on all fixed assets at rates calculated to write off the cost of each asset on a straight line basis over its expected useful life.

Stocks and work-in-progress

Stocks and work-in-progress are stated at the lower of cost and net realisable value.

Deferred taxation

Deferred tax is provided in full at appropriate rates in respect of taxation deferred by timing differences between the treatment of certain items for taxation and accounting purposes, if those timing differences are not permanent and have originated but not reversed by the balance sheet date. The deferred tax balance has not been discounted.

Finance leases and hire purchase commitments

Assets obtained under finance leases and hire purchase contracts are capitalised in the balance sheet and depreciated over their useful economic lives.

The interest element is charged to profit and loss account on a straight line basis over the period of the finance leases or hire purchase contracts.

Rentals paid under operating leases are charged to income on a straight line basis over the lease period.

Foreign currencies

Profit and loss account transactions denominated in foreign currencies are translated into sterling and recorded at the rate of exchange ruling at the date of the transaction.

Monetary assets and liabilities denominated in foreign currencies are retranslated at the rate of exchange ruling at the balance sheet date.

All differences are taken to the profit and loss account.

Turnover

Turnover represents management fees receivable.

2. Operating loss This is stated after charging:
	2012	2011
	£	£
Directors' remuneration - Salaries and fees	42,472	33,000
Auditors' remuneration - Audit services	8,900	8,700
- Accounting and taxation compliance services	12,450	14,350
3. Employees
The average number of employees during the year was made up as follows:
	2012	2011
Directors	3	3
Other	-	-
	3	3
Employee costs including directors during the year amounted to:
Salaries and fees	42,472	33,000
	£42,472	£33,000

4. Directors' remuneration

Information relating to directors' emoluments is included in the directors' remuneration report on pages 6 and 7.

5. Taxation Based on the loss for the year: U.K. corporation tax at 20% (2011: 21%) Under/(over) provision in previous years	2012 - -	2011 - -
	£-	£-
Factors affecting the tax charge/(credit) for the year
Loss on ordinary activities before taxation	£(93,105)	£(92,933)
Loss on ordinary activities before taxation multiplied by the small company rate of UK corporation tax of 20% (2011: 21%)	£(18,621)	£(19,516)
Effects of:
Current period tax losses not utilised	18,496	19,516
Disallowed expenditure/(income)	125	-
Adjustments to tax charge in respect of previous periods	-	-
	£18,621	£19,516
Current tax charge/(credit)	£-	£-

The company has estimated losses of £896,000 (2011: £803,000) that may be available for carry forward against future profits, and estimated capital losses of £1,460,000 (2011: £1,460,000) that may be available for carry forward against future chargeable gains. No deferred tax asset has been recognised in the accounts in respect of these unrelieved losses.

6. Dividends

2012 2011

Interim paid nil per share (2011: nil) - -

£- £-

____________________

7. Loss per share

The loss per ordinary share calculation has been based on the loss attributable to ordinary shareholders of £93,105 (2011: loss £92,933), divided by 7,945,638 (2011: 7,945,638), being the weighted average number of ordinary shares in issue during the year. The basic and the diluted loss per ordinary share are the same.

There are no discontinued operations in either period and, therefore, the basic and the diluted loss per ordinary share from continuing operations are the same as the basic and the diluted loss per ordinary share.

8. Investments

The company currently has no investments.

9. Capital commitments At 29 February 2012 the company had no capital commitments. 10. Debtors
	2012	2011
Other debtors	1,703	1,085
Prepayments	2,346	2,546
	£4,049	£3,631
11. Creditors: amounts falling due within one year
	2012	2011
Trade creditors	4,480	1,480
Accruals	18,250	20,375
	£22,730	£21,855
12. Borrowings

The company had no bank loans or overdrafts existing at the beginning or end of the year.

13. Deferred taxation

The estimated deferred tax asset not recognised in the accounts, based on a 24% rate of tax, amounts to £565,000 (2011: based on a 26% rate of tax £588,000). Of this amount, £350,000 may be recoverable by the company against future chargeable gains, and £215,000 may be recoverable against future profits.

14. Share capital	Number of Shares	Nominal Value	Number of Shares	Nominal Value
	2012	2012	2011	2011
Authorised -
Ordinary shares of 2p each	50,000,000	£1,000,000	50,000,000	£1,000,000
Allotted, called-up and fully paid -
Ordinary shares of 2p each	7,945,638	£158,913	7,945,638	£158,913
15. Related party transactions

Howard Drummon, non-executive Chairman until he resigned on 19 September 2011, was a consultant to, and until 11 June 2008 was a director of, Keith, Bayley, Rogers & Co Limited, the financial adviser and stockbroker to the company. In the year ended 29 February 2012, Keith, Bayley, Rogers & Co Limited received retainer fees of £10,000 (2011: £10,000) and website set up and maintenance fees of £1,000 (2011: £1,667).

16. Reconciliation of movements on reserves

Share Profit

Premium and Loss

Account Account

At 1 March 2011 295,437 (243,727)

Retained loss for the year - (93,105)

At 29 February 2012 £295,437 £(336,832)

_______ ________

17. Other financial commitments

At 29 February 2012 the company had no commitments for the year ending 28 February 2013 under non-cancellable operating leases.

18. Financial instruments

The Company's financial instruments comprise cash, trade debtors and trade creditors that arise directly from its operations. The Company's policy has been, and continues to be, that no speculative trading in financial derivatives shall be undertaken.

19. Financial assets

The cash is held in bank current and premium accounts and on treasury deposit, which receive varying rates of interest that is recognised on a receivable basis. All financial assets and liabilities are denominated in Sterling.

Fair value of financial assets and liabilities

The fair value of financial assets and liabilities, calculated by discounting expected future cash flows at prevailing interest rates, is not materially different from their book value, and is as follows:

	2012	2011
Financial assets
Receivables	4,049	3,631
Cash at bank	136,199	228,847
	£140,248	£232,478
Financial liabilities
Payables: current liabilities	£22,730	£21,855

Hedging

The Company makes no use of forward currency contracts, other financial derivatives or hedging.

Interest rate risk

The Company does not have an interest rate policy in isolation but regularly reviews the interest rates being received on deposits.

Liquidity risk

The principal policy of the Company in managing liquidity risk is to align the anticipated timing of expenditure with the availability of its cash balances.

20. Cash flow statement

		2012	2011
(a) Net cash outflow from operating activities
Operating loss		(93,802)	(93,371)
Increase in debtors		(418)	(696)
Increase in creditors		875	404
Net cash outflow from operating activities		£(93,345)	£(93,663)

(b) Analysis of net funds/(debt)	1 March 2011	Cashflow	29 February 2012
Net cash: cash at bank and in hand	228,847	(92,648)	136,199
Net funds/(debt)	£228,847	£(92,648)	£136,199

		2012	2011
(c) Reconciliation of net cash flow to movements in net funds/(debt)
Decrease in cash in the year		(92,648)	(93,225)

Movement in net funds/(debt) in the year		(92,648)	(93,225)
Opening net funds/(debt)		228,847	322,072
Closing net funds/(debt)		£136,199	£228,847