Interim Results
Parkmead Group (The) PLC
21 March 2007
21 March 2007
The Parkmead Group plc (the 'Group')
Interim Results for the 6 months ended 31 December 2006
Interim results summary
• Operating loss reduced to £19,000 - (2005 - loss £1,593,000)
• Cash balances increased from £6.2 million as at 30 June 2006 to £7.4 million
as at 31 December 2006.
• Loss per share of Nil pence (2005 - loss of 3.6 pence)
Significant events
• The February 2006 acquisition of Quayside Corporate Services Limited
('Quayside') is now fully integrated into the Group and is trading profitably
• Disposal of the Group's 54% holding in Audio Visual Machines Limited ('AVM')
for a consideration of £1,275,000 before expenses leading to a consolidated
profit on disposal of £166,165
• Subsequent to the half year end, the Group has disposed of its 54% holdings
in Yospace Technologies Limited ('Yospace') and its 19% holding in The
Respond Group Limited ('Respond') for a total of £7.1 million before expenses
The Group's Chairman, Colin Goodall said, 'the Group has now emerged from its
restructuring period as a profitable business focused on three activities -
business turnaround, principal finance and corporate finance. Trading in these
remaining areas so far in the second half is in line with our expectations.
Following the recent disposals of Yospace and Respond, the Group's balance sheet
has been further strengthened and the Group is now in a strong position to
exploit the many opportunities available to it.
Ends
Enquiries
The Parkmead Group plc 020 7494 3080
Niall Doran (Chief Executive)
Gordon Ashworth (Chief Financial Officer)
Madano Partnership (PR to The Parkmead Group plc) 020 7593 4000
Matthew Moth/Mark Way
Financial Review
During the six months ended 31 December 2006 the Group recorded an operating
loss of £19,000 (2005: £1,593,000). This included the loss of £86,000 incurred
from Yospace, and also after having amortised £303,000 of goodwill relating to
the acquisition of Quayside.
In September 2006 the Group disposed of its holding in AVM for a consideration
of £1,275,000 before expenses. Whilst the Group made a cash profit of £768,000
on the sale of this subsidiary, on consolidation the profit on disposal amounted
to £166,000.
The Group took the opportunity to write down the value of its portfolio
investments by £303,000 (2005: £1,623,000). This charge relates to the Group's
holding in Red M Limited and this investment is now carried at £nil (2005:
£303,000).
After minority interests the Group's retained loss for the period amounted to
£170,000 (2005: loss £3,347,000).
Consolidated profit and Loss Account Six
Months ended 31 December 2006
Six months Six months Twelve
to 31 to 31 months
December December to 30
2006 2005 June
2006
Continuing Discontinued Total Continuing Continuing Operations Discontinued Total
Existing Acquisitions
(unaudited) (unaudited) (unaudited) (unaudited) audited audited audited audited
£000 £000 £000 £000 £000 £000 £000 £000
Turnover 2 3,370 2,816 6,187 6,592 4,552 488 7,967 13,006
Cost of sales (254) (1,741) (1,995) (2,040) - (317) (4,673) (4,990)
Gross profit 3,116 1,075 4,192 4,552 4,552 171 3,294 8,017
Administrative
expenses (3,380) (912) (4,292) (6,197) (7,096) (47) (3,285) (10,428)
Other
Operating
Income 82 - 82 52 106 - - 106
Operating
(loss)/profit (182) 163 (19) (1,593) (2,438) 124 9 (2,305)
Profit on sale
of investment,
provisions
released/
(made) against
investments in
the period (303) (1,623) (2,671)
Profits on
disposal of
subsidiaries/
investments 166 - 364
Net interest
receivable
(payable) 43 (64) (2)
Loss on
ordinary
activities
before
taxation (113) (3,280) (4,613)
Taxation (5) - (42)
Profit (loss)
on ordinary
activities
after taxation (118) (3,280) (4,655)
Minority
interest (52) (67) (87)
Retained loss
for the period (170) (3,347) (4,742)
Earnings
(loss) per
share - basic
and diluted
(pence) 3 Nil (3.62) (2.80)
Consolidated statement of
total recognised gains and
losses
Six months Six months Twelve months
to 31 to 31 to 30
December December June
2006 2005 2006
(unaudited) (unaudited) audited
£000 £000 £000
Loss for the financial
year attributable to
members of the parent
company (170) (3,347) (4,742)
Write down of previous
revaluation of fixed
asset investments - (212) (1,096)
Unrealised profit on
partial disposal of
subsidiary - 326 -
Currency translation of
foreign currency
investments 30 - 10
Total recognised losses
for the financial period (140) (3,233) (5,828)
Consolidated balance sheet as at 31 December 2006
As at 31 As at 31 As at 30
December December June
2006 2005 2006
(unaudited) (unaudited) audited
£000 £000 £000
Fixed Assets
Intangible asset 5,921 1,989 8,177
Tangible assets 132 510 598
Investments 4 2,816 3,757 3,059
8,869 6,256 11,834
Current Assets
Stock - 178 253
Debtors 5 4,211 2,699 6,697
Cash at bank and in hand 7,375 535 6,207
11,585 3,412 13,158
Creditors
Amounts falling due within one year 6 (1,721) (5,610) (5,188)
Net current assets (liabilities) 9,865 (2,198) 7,970
Total assets less current liabilities 18,733 4,058 19,805
Creditors
Amounts falling due after one year (487) (688) (695)
Provision for liabilities and charges - - (109)
Net assets 18,247 3,370 19,001
Capital & reserves
Called up share capital 18,417 4,620 18,417
Share premium account - 19,430 -
Revaluation reserves - 882 -
Profit and loss accounts 1,029 (19,501) 1,199
Merger Reserve (952) (2,407) (952)
Exchange difference on foreign
subsidiaries 21 - -
Currency translation of foreign currency
investments 18,515 3,024 18,663
Minority shareholders' funds (268) 346 337
Capital employed 18,247 3,370 19,001
Consolidated cash flow statement Six months Six months Year
to 31 to 31 to 30
December December June
2006 2005 2006
(unaudited) (unaudited) audited
£000 £000 £000
Net cash from operating activities 76 (265) (3,697)
Returns on investment and servicing of
finance 43 47 (2)
Taxation - - 83
Capital expenditure and financial
investment (78) (108) (1,222)
(Acquisition)/Disposal 1,396 (72) (407)
Cash in(out)) flow before use of liquid
resources and financing 1,438 (398) (5,244)
Financing (64) - 10,584
Increase (decrease) in cash 1,375 (398) 5,341
Reconciliation of net cash flow to Six months Six months Year
movement in net debt to 31 to 31 to 30
December December June
2006 2005 2006
(unaudited) (unaudited) audited
£000 £000 £000
Increase/(decrease) in cash in the period 1,375 (398) 5,341
increase (decrease) in debt and lease
financing 64 - 1,632
Loans and finance leases (acquired) with
subsidiaries 270 - (9)
Other non cash changes - new finance leases (13)
Change in net funds (debt) 1,709 (398) 6,951
Net funds (debt) as at 1 July 2006 5,352 (1,599) (1,599)
Net funds (debt) as at 31 December 2006 7,061 (1,997) 5,352
Notes to the Interim financial statements for the six months to 31 December 2006
1 Basis of preparation
The interim financial statements have been prepared on the basis of the
accounting policies set out in the Group's statutory accounts for the year ended
30 June 2006, and are unaudited. The interim financial statements do not
constitute statutory financial statements within the meaning of section 240 of
the Companies Act 1985.
Comparative figures for the year ended 30 June 2006 are an abridged version of
the Group's full accounts which carry an unqualified audit report.
Going concern
The Directors of the Group are satisfied that, after having made appropriate
enquiries, that the Group has adequate resources to continue to adopt the
concern basis in preparing the interim financial statements.
2 Turnover
Turnover and segmental analysis by
geographical market
Six months to Six months to 31 Twelve
31 December December 2005 months to 30
2006 June 2006
(unaudited) (unaudited) audited
£000 £000 £000
United Kingdom 5,860 6,227 10,342
Other European countries 311 85 953
USA and Canada 13 215 1,697
Other 2 65 14
6,187 6,592 13,006
3 Loss per share
The calculation of basic earnings per share is calculated on a Group loss of
£169,510 (6 months to 31 December 2005 loss of £3,347,357 and year to 30 June
2006 loss of £4,741,702) and a weighted average number of ordinary 5p shares in
issue during the period of 368,341,780 (6 months to 31 December 2005 92,425,254
and year to 30 June 2006 171,332,649).
Due to the loss of £169,510 (6 months to 31 December 2005 loss of £3,347,357 and
year to 30 June 2006 loss of £4,741,702) there is no further dilution of the
earnings or the number of shares of 368,341,780 (6 months to 31 December 2005
92,425,254 and year to 30 June 2006 171,332,649).
4 Investments
As at 01 July
2006
(unaudited)
£000
As at 01 July 2006 3,059
Additions 60
Disposals -
Provided during the period (303)
Revaluation -
31 December 2006 2,816
5 Debtors
Debtors Six months Six months Year
to 31 to 31 to 30
December December June
2006 2005 2006
(unaudited) (unaudited) audited
£000 £000 £000
Trade debtors 1,149 2,150 2,748
Amounts recoverable on contracts - 263 112
Other Debtors 2,790 27 3,310
Prepayments and accrued income 272 259 527
4,211 2,699 6,697
Due in more than one year - - -
4,211 2,699 6,697
6 Creditors
Creditors Six months to Six months to Year to
31 December 31 December 30 June
2006 2005 2006
(unaudited) (unaudited) audited
£000 £000 £000
Bank overdraft - 174 207
Short-term loans 30 1,525 202
Obligations under finance leases and hire purchase contracts - 19
Trade creditors 532 1,255 1,507
Corporation tax 259 17 793
Other taxes and social security costs 243 580 628
Other creditors 112 453 77
Accruals and deferred income 546 1,606 1,753
1,721 5,610 5,188
7 Cash Flows
Reconciliation of operating loss to net cash flow from Six months Six months Year
operating activities to 31 to 31 to 30
December December June
2006 2005 2006
(unaudited) (unaudited) audited
£000 £000 £000
Operating loss (19) (1,593) (2,305)
Depreciation 2 145 179
Amortisation 318 369 427
Increase(decrease) in stocks - (233) (23)
Increase (decrease) in debtors 619 (228) (2,973)
Increase (decrease) in creditors (782) 1,275 898
Increase in other provisions 21 - 100
Net cash flow from operating activities 158 (265) (3,697)
8 Post balance sheet events
On 1 February 2007 the Group disposed of its 54% holding in Yospace Technologies
Limited for a consideration of £5.0 million before expenses. On 16 February
2007 the Group disposed of its 19% holding in The Respond Group Limited for a
consideration of £2.1 million before expenses.
Interim statement
Copies of the Interim statement will be available to the public free of charge
from the Company's registered office: 22/23 Old Burlington St, London W1S 2JJ.
A copy of the Interim statement will also be made available on the Group's
website, www.parkmeadgroup.com.
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