Interim Results

RNS Number : 1350J
Z Group PLC
28 November 2008
 



28 November 2008


Z GROUP plc


Interim Results for the six months ended 31 August 2008



Z GROUP plc (Z GROUP or the Company), the AIM listed cash shell, announces its unaudited interim results for the six months ended 31 August 2008.


Summary of Interim Results


  • Revenues in the period were £8,750 (2007: Nil

  • Administrative costs in the period were £113,230 (2007: £336,590)

  • Dividend income of £12,422,502 received from the Company's dormant subsidiary Z Group Investments Limited with a corresponding write down of investments

  • Finance income in the period was £41,575 (2007: £24,288)

  • As a result, the Company is reporting a six month loss before tax of £67,905 (2007: loss £261,762)

  • Loss per share of 0.29p (2007: loss of 1.10p)

  • £234,059 of cash was received in connection with the sale of Net2Roam Limited and Onshare Limited

  • Cash at bank as at 31 August 2008 £1,322,558 (2007: £1,213,365)


Further Enquiries



Z GROUP plc 


Duncan Neale (Finance Director)

Tel: +44 (0) 20 7952 4043


John East & Partners Limited


Bidhi Bhoma / Simon Clements

Tel: +44 (0) 20 7628 2200


 

Chairman's statement


I am pleased to present the interim results of the Company for the six months ended 31 August 2008.


RESULTS


Revenue of £8,750 (2007: Nil) arose from the provision of management consultancy services in the period.


Administrative costs in the period were £113,230 (2007: £336,590). The reduction compared with the previous year reflects the fact that the disposal of Net2Roam Limited and Onshare Limited took place in January 2008.  £94,474 of further cash consideration in relation to these disposals is expected to follow in the second half of this financial year. Following the disposals, the Company had no trading business and as a result the cost base was reduced significantly. 


The loss on ordinary activities after taxation for the year amounted to £67,905 (2007 - loss £261,762) representing a loss per share of 0.29 pence (2007 - loss 1.10 pence).


The Directors did not declare a dividend in the period.


CHANGES IN DIRECTORS DURING THE PERIOD


On 18 March 2008, Ian Smith was appointed as a non-executive director and Marcus Yeoman was appointed as a part-time executive director of the Company. On the same day, Jack Bekhor and Jamie True stepped down as joint CEOs and as executive directors of the Company.


CASH POSITION


The unaudited cash position as at 31 August 2008 was £1,322,558. The unaudited cash position at 25 November 2008, being the last practicable date prior to the publication of this document, was £1,256,891.


PROSPECTS


The directors' objective is to preserve cash resources while actively pursuing potential acquisitions, which are at various stages of discussion at this time. Under the AIM rules the Company's shares will be suspended from trading on AIM if a suitable acquisition has not been made in accordance with the investing strategy by 7 January 2009.  



 

JON CLAYDON

Non-executive Chairman

28 November 2008


 

Income Statement

for the six months ended 31 August 2008



Unaudited

Unaudited

Audited


Six months 

ended

Six months 

ended

Year 

ended


31 August

 2008

31 August 

2007

29 February 

2008


£

£

£





Revenue

8,750

-

-

Cost of sales

(5,000)

-

-

Gross profit

3,750

-

-

Share based payments credit 

-

-

383,667

Other administrative expenses

(113,230)

(336,590)

 (860,830)

Proceeds on disposal of investments

-

-

60,000

Write down of investments


(12,422,502)

-  

 (4,638,803)





OPERATING LOSS

(12,531,982)

(336,590)

(5,055,966)

Finance income

41,575

24,288 

53,404 

Dividend income

12,422,502 

-

-

Other income

-

50,540 

91,231 

LOSS BEFORE INCOME TAX

(67,905)

(261,762)

(4,911,331)

Income tax expense

-

-

816 


LOSS FOR THE YEAR

(67,905)

(261,762)

(4,910,515)


 

 

 


Basic and diluted loss per share (pence) (Note 3)

(0.29)

(1.10)

 (20.68)


  

Balance Sheet

at 31 August 2008






Unaudited

Unaudited

Audited


As at

As at

As at


31 August 

31 August 

29 February 


2008

2007

2008


£

£

£

Assets




Investments

-

16,991,305

-

Property, plant and equipment

8,935

116,016

10,898

Other intangible assets

-

2,012

-

Other receivables

117,500

117,500

117,500


Non-current assets

126,435

17,226,833

128,398





Trade and other receivables

160,091

3,510,494

374,552

Cash and cash equivalents

1,322,558

1,213,365

1,203,824


Current assets

1,482,649

4,723,859

1,578,376






Total assets

1,609,084

21,950,692

1,706,774





Equity and Liabilities




Capital and reserves attributable to equity holders of the Company




Share capital

1,187,294

1,187,294

1,187,294

Share premium account

5,967,758

5,966,858

5,967,758

Share option reserve

700,382

1,084,049

700,382

Retained losses

(6,367,099)

(1,650,440)

(6,299,194)


Total equity

1,488,335

6,587,761

1,556,240





Trade and other payables

120,749

15,362,931

150,534


Current liabilities

120,749

15,362,931

150,534






Total liabilities

120,749

15,362,931

150,534






Total equity and liabilities

1,609,084

21,950,692

1,706,774


  


Statement of Changes in Equity

for the six months ended 31 August 2008




Share capital


Share premium

Share based payments reserve


Retained earnings



Total


£

£

£

£

£







Balance at 1 March 2008

1,187,294 

5,967,758 

700,382 

(6,299,194)

1,556,240 







Loss for the period

-

-

-

(67,905)

(67,905)

Total recognised income and expense for the period

-

-

-

(67,905)

(67,905)







Balance at 31 August 2008

1,187,294 

5,967,758 

700,382 

(6,367,099)

1,488,335 


  

Cash Flow Statement

for the six months ended 31 August 2008



Unaudited

Unaudited

Audited


six months

ended

six months

ended

Year 

ended


31 August 

31 August

29 February 


2008

2007

2008


£

 £

£

Cash flows from operating activities




Operating loss

(12,531,982)

(336,590)

(5,055,966)

Depreciation

1,963 

19,860

32,711

Amortisation

-

25

510

Share option expense

-

-

(383,667)

Dividend income

12,422,502

-

16,991,305 

Decrease / (Increase) in trade and other receivables

214,462

(747,681)

2,388,261 

(Decrease) / (Increase) in trade and other payables

(29,080)

795,734 

(14,417,368)

Write down of web development costs and domain names

-

-

1,807 

Cash generated from / (used in) operations

77,865 

(268,652)

(442,407)





Income tax credit

-

-

816

Net cash generated from / (used in) operating activities

77,865

(268,652)

(441,591)





Cash flows from investing activities




Purchase of property, plant and equipment

-

-

(5,340)

Proceeds from the sale of property, plant and equipment

-

2,323

99,649

Interest received 

41,575

24,288

53,404

Other income

-

50,540

91,231

Net cash generated from investing activities

41,575

77,151

238,944





Cash flows from financing activities 




Credit on issue of share expenses

-

(900)

-  

Net cash generated from financing activities

-

(900)

-  





Net increase / (decrease) in cash and cash equivalents

119,440 

(192,401)

(202,647)

Cash and cash equivalents at the beginning of the period

1,203,118 

1,405,766 

1,405,765 

Cash and cash equivalents at the end of the period

1,322,558 

1,213,365 

1,203,118 


 

Notes to the Interim report

for the six months ended 31 August 2008


1.     Basis of preparation

The financial information for the six months ended 31 August 2008 and 31 August 2007 has been prepared in accordance with the International Financial Reporting Standards ('IFRS')and is unaudited. The comparative figures for the year ended 29 February 2008 were derived from the Group's audited financial statements for that period as filed with the Registrar of Companies as restated for IFRS.  The financial information does not constitute the financial statements for that period. Those accounts received an unqualified audit report which did not contain any statement under s237 (2) or (3) of the Companies Act 1985.


2.    Summary of Significant Accounting Policies


(a)    Property Plant and Equipment

Property, plant and equipment are initially recorded at cost of purchase and are depreciated on a straight-line basis over their estimated useful lives, as follows:


Computer equipment, office equipment, fixtures and fittings        4 years


(b)    Impairment of tangible and intangible assets 

At each balance sheet date, the Company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indications exist, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). An intangible asset with an indefinite useful life is tested for impairment annually and whenever there is an indication that the asset may be impaired.


The recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates for future cash flows have been adjusted.


If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. An impairment loss is recognised as an expense immediately, unless the relevant asset is carried at a re-valued amount, in which case the impairment loss is treated as a revaluation decrease.


Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in prior years. A reversal of an impairment loss is recognised as income immediately, unless the relevant asset is carried at a re-valued amount, in which case the impairment loss is treated as revaluation increase. 


(c)    Revenue recognition

Revenue is stated net of Value Added Tax and net of any applicable discounts or rebates.


(d)    Share based payments

The Company has applied the requirements of IFRS 2 Share-based Payments. In accordance with the transitional provisions, IFRS 2 has been applied to all grants of equity instruments after 7 November 2002 that were unvested as of 1 March 2006.


The Company issues share options to certain employees. These options are measured at fair value at the date of the grant, using the Black-Scholes option-pricing model. The fair value of the options is expensed on a straight-line basis over the vesting period, based on the Company's estimate of when shares will vest, applying the assumptions on a consistent basis with those used in the audited financial statements for the year ended 28 February 2007.


3.    Earnings per share

The calculation of basic earnings per share is based upon the profit after tax divided by the weighted average number of shares in issue during the period.


The calculation of fully diluted earnings per share is based upon the profit after tax divided by the weighted average number of shares in issue during the period after taking into account the dilutive effect of share options.



Basic & diluted loss per share

Loss after tax

£


Weighted average

number of shares



EPS (pence)


6 months ended 31 August 2008


(67,905)


23,745,879


(0.29)


6 months ended 31 August 2007


(261,762)


23,745,879


(1.10)

12 months ended 29 February 2008


(4,910,595)


23,745,879


(20.68)


Due to the loss incurred in the above periods, there is no dilutive effect from the issue of share options.


4.    Interim results

Copies of the Interim results are available from the Company's registered office, 31 Vernon Street, London W14 0RN and on the Company's website www.zgroupplc.com  




This information is provided by RNS
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