Final Results

05 November 2007 The Core Business: Results - Year ended 31 May 2007 The Core Business PLC, (the 'Company') the innovative beauty brand business, today announces its results for the year to 31 May 2007. Highlights: · Increased business coming from distribution and a move towards higher value brand consultancy assignments · Strategic acquisition of Amirose International Limited, a distribution company, completed post year end · Exclusive 5 year UK distribution agreement signed with Accessoire Beauté Cosmétique, the global licensee for Elite Models Fashion beauty products · Launched Elite Models Fashion beauty accessories in 90 Superdrug stores in March 2007 with subsequent roll out to 350 stores post year end. · Launched Elite Models Fashion colour cosmetics in 200 Superdrug stores in September 2007 with the development work for this launch taking place in the reporting year. · Completed the initial phases of a strategic consultancy project with Boots. · Provided strategic guidance to Cosnova GmbH, owners of essence, the second largest colour cosmetics brand in the German market. Commenting on the results and outlook, Mark Watson-Mitchell, Chairman, said: The year to 31 May 2007 saw some significant moves by the Company. Licensing of personal care brands is a strategic objective of the Company. Early on in the year we secured an agreement with Ministry of Sound to develop personal care products under licence but this was terminated. The subsequent withdrawal from that contract was costly in time and effort. It is now behind us. However, as we switched our focus onto our distribution model we have secured some very interesting new lines of business. Key to that has been our agreement with Accessoire Beauté Cosmétique, to distribute in the UK, the Elite Models Fashion beauty products. In less than three months from signing the agreement we listed the Elite Models Fashion beauty accessories into Superdrug. Initially trialled in March 2007 in 90 stores its early success has led to a roll out in 350 stores. The subsequent retail sales have been impressive. We also launched Elite Models Fashion colour cosmetics in 200 Superdrug stores in September 2007. Significant development work for that launch took place in the reporting year and we have seen the revenue benefiting the business from August 2007 onwards. We intend to extend our offer range with the Elite Models Fashion brand and are currently working with Accessoire Beauté Cosmétique to develop new ranges. The most impactful component of our advance since the year end was the acquisition in July 2007 of Amirose International, a very successful distribution company whose own product lines and customer listings will be boosted by a significant contribution from The Core Business management team. Amirose has already "bedded down" inside the Group fold and we are positive that it will really boost the Company's overall offer and distribution abilities. We are now greatly encouraged by the performance of the Company and look forward to generating significantly increased sales during the current year. We thank all of our management, staff, advisors and shareholders for their support." Stirling Murray, Chief Executive added: "The Core Business is now better placed to exploit fully the many trading opportunities we have. The reporting year was a difficult period where much effort and investment was expended on a licensing agreement that failed to materialise. We focused very quickly in the second half of the reporting year on distributing brands and had an early success with Elite Models Fashion beauty accessories. We believe that along with Elite Models Fashion colour cosmetics launched in September 2007 these products will form a powerful foundation for our distribution business. The acquisition of Amirose after post year end was of major strategic significance and will provide the company with access to low cost manufacturing, an increased network of retail contacts and the opportunity to quickly develop new brand concepts. Much of the work to complete this acquisition took place in the reporting year. We are very excited by the prospects for the coming financial year. Following its acquisition we are delighted to be working with the team at Amirose, and feel that our combined expertise will allow us to advance quickly towards our strategic objective of building a total beauty management group." For further information, please contact: The Core Business PLC www.thecorebusiness.co.uk Stirling Murray, Chief Executive 020 7483 4300 Alastair Kennedy, Finance Director 020 7483 4300 Blomfield Corporate Finance Ltd Nick Harriss 020 7512 0191 Notes to Editors The Core Business was established in May 2004 by Stirling Murray to create, develop, launch and distribute personal care and beauty brands. It also provides consultancy and brand management services. The Company was listed on AIM in March 2006 under the ticker `CORE.' Financial results BALANCE SHEET 2007 2006 £ £ Assets Non-current assets Property, plant and equipment 1,507 740 Financial assets 21,706 10,578 _______ _______ 23,213 11,318 Current Assets Inventories 5,510 - Trade receivables 52,395 19,156 Other current assets 156,886 26,815 Cash and cash equivalents 79,576 401,085 _______ _______ 294,367 447,056 _______ _______ Total assets 317,580 458,374 ======= ======= Equity and liabilities Equity attributable to the Company's equity holders Share capital 211,982 201,383 Share premium 411,913 337,719 Retained earnings (539,267) (132,245) _______ _______ 84,628 406,857 Current liabilities Trade and other payables 232,952 51,517 _______ _______ Total liabilities 232,952 51,517 ======= ======= Total equity and liabilities 317,580 458,374 ======= ======= PROFIT AND LOSS ACCOUNT YEAR ENDED 31 MAY 2007 2007 2006 Notes £ £ Turnover Consultancy fees 164,957 122,157 Sale of goods 92,101 - _______ _______ Total turnover 257,058 122,157 Cost of goods sold (58,137) - _______ _______ Gross margin 198,921 122,157 Overhead costs Staff costs (227,793) (60,680) Depreciation (1,196) (541) Other operating costs (384,854) (195,540) _______ _______ Loss from operations (414,922) (134,604) Interest income 11,210 2,964 Impairment of investment in - (1,714) associate company Loss before tax (403,712) (133,354) Income tax expense (3,310) 12,190 _______ _______ Loss for the year (407,022) (121,164) _______ _______ Loss per share 2 Basic (0.97 pence) (0.66 pence) Diluted (0.97 pence) (0.66 pence) STATEMENT OF CHANGES IN EQUITY YEAR ENDED 31 MAY 2007 Share Share Retained Capital Premium Earnings Total £ £ £ £ Balance at 1 June 2005 100 - 5,224 5,324 Changes in equity for the year to 31 May 2006 Loss for the year - - (121,164) (121,164) ______________________________________ Total recognised income and expense for the year - - (121,164) (121,164) Credit on issue of warrants - - 5,000 5,000 Interim dividends paid(note 14) - - (21,305) (21,305) Issue of share capital 201,283 447,822 - 649,105 Issue and start up costs - (110,103) - (110,103) ______________________________________ Balance as at 31 May 2006 201,383 337,719 (132,245) 406,857 Changes in equity for the year to 31 May 2007 Loss for the year - - (407,022) (407,022) ______________________________________ Total recognised income and expense for the year - - (407,022) (407,022) Issue of share capital 10,599 74,194 - 84,793 ______________________________________ Balance as at 31 May 2007 211,982 411,913 (539,267) 84,628 ====================================== CASH FLOW STATEMENT TO 31 MAY 2007 2007 2006 Notes £ £ Cash flows from operating activities Cash generated from operating activities (404,421) (102,777) Tax paid - (16,749) ________ ________ (404,421) (119,526) Cash flows from investing activities Purchases of property, plant and equipment (1,963) (595) Investment in financial asset (11,128) (10,578) Interest received 11,210 2,964 ________ ________ Net cash used in investing activities (1,881) (8,209) Cash flows from financing activities Net proceeds on issues of share 84,793 539,002 Dividends paid - (21,305) ________ ________ Net cash from financing activities 84,793 517,697 Net (decrease)/ increase in cash (321,509) 389,962 and cash equivalents Cash and cash equivalents at beginning of year 401,085 11,123 ________ ________ Cash and cash equivalents at end of year 79,576 401,085 ======== ======== Bank balances and cash 79,576 401,085 ======== ======== NOTES TO THE ACCOUNTS 1 Summary of significant accounting policies Revenue recognition Revenue comprises the fair value of the consideration received or receivable for the sale of goods and services provided in the ordinary course of the Company's activities. Revenue derived from the Company's principal activities (which is shown exclusive of applicable sales taxes, where applicable) is recognised as follows: Consultancy fees are recognised as income in the accounting period in which the consultancy is provided. Revenue from sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer, usually on despatch of the goods. Interest income is accrued on a time basis, by reference to the principal outstanding and at the interest rate applicable. Inventories Inventories held for resale is valued at the lower of cost and net realisable value. 2. Loss per share Loss 2007 2006 £ £ Loss for the purpose of basic loss per share (407,022) (121,164) Loss for the purpose of diluted loss per share (407,022) (121,164) Number of shares 2007 2006 Weighted average number of ordinary shares - for the purposes of basic loss per share 42,065,406 18,392,429 - for the purposes of diluted loss per share 42,065,406 18,392,429 The dilutive effect of unexercised share warrants issued during the last two years have been ignored as the average market value of ordinary shares during those years did not exceed the exercise price of the warrants issued. 3. Post balance sheet event The following acquisition took place after the balance sheet date and before the approval of these financial statements: Name of business Principal Date of Proportion Cost of acquired activity acquisition of shares acquisition acquired Amirose International Limited Distribution 27 July 2007 100% £3,164,000 Cost of acquisition: £ Equity 1,350,000 Loan notes 850,000 Cash 694,000 Directly attributable acquisition costs 270,000 __________ Total 3,164,000 The equity consideration was satisfied by The Core Business Plc issuing 135 million ordinary shares at a price of 1 penny on 27 July 2007. The issue price consists of the nominal value of the ordinary shares of 0.5 pence and a share premium of 0.5 pence. Warrants were issued to subscribers on a ratio of 1 warrant for every 2 shares subscribed for. The exercise price of the warrants is 1 penny per ordinary share exercisable at any time up to and including the fifth anniversary of issue. Directly attributable acquisition costs are those charged by the Company's advisers in performing due diligence activities and producing the acquisition documents. The total consideration payable for Amirose International Limited is £2,894,000 and comprises £2,600,000 paid on acquisition subject to a £1 for £1 increase or reduction if the net assets value of Amirose following a verification exercise at completion was greater or less than £1,234,000. Subject to completion of the fair value and verification exercise, net assets acquired at 27 July 2007 were: Book value at Fair value at acquisition acquisition £ £ Non-current assets Property, plant and equipment 9,162 9,162 Current Assets Inventories 238,971 238,971 Trade receivables 282,187 282,187 Cash and cash equivalents 1,166,353 1,166,353 _________ _________ 1,687,511 1,687,511 _________ _________ Total assets 1,696,673 1,696,673 ========= ========= Current liabilities Trade and other payables 67,764 67,764 Current tax payable 101,018 101,018 _________ _________ Total liabilities 168,782 168,782 ========= ========= Net assets acquired 1,527,891 1,527,891 ========= ========= Goodwill on acquisition 1,636,109 _________ Cost of acquisition 3,164,000 ========= Copies of the Company's report and accounts for the year ended 31 May 2007 have been posted to shareholders.

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