Final Results

RNS Number : 5085J

Marwyn Materials Limited

31 March 2010

 



31 March 2010

Marwyn Materials Limited (the 'Company')

Publication of Annual Report, Notice of Annual General Meeting and Results

The Directors of Marwyn Materials Limited are pleased to announce that the Annual Report and Accounts for the period ended 31 December 2009 and the Notice of the Annual General Meeting have today been posted to all shareholders.

Copies of the Annual Report and Accounts will be available, free of charge, for a period of one month at the Company's registered office at Elizabeth House, 9 Castle Street, St Helier, Jersey, JE2 3RT.

The Annual General Meeting will be held at Elizabeth House, 9 Castle Street, St Helier, Jersey, JE2 3RT on Monday, 26 April 2010 at 2 p.m. Details of the results of Marwyn Materials Limited for the period from incorporation to 31 December 2009 are given below.

Acquisition strategy

Marwyn Materials Limited was established in June 2008 to acquire controlling interests in building materials businesses, both listed and unquoted, in the UK, Europe and US, with a view to creating shareholder value through market consolidation.  This continued to be the Group's strategy throughout the period under review.

During the course of the year the economic situation continued to deteriorate and the demand for building materials reflected this, with most companies reporting sharply lower earnings.  A number of potential opportunities in the UK and in continental Europe have been examined, but the Board concluded that none were available on satisfactory terms and consequently, as at the year-end, no transactions had been concluded.  The Board believes that vendor expectations are becoming increasingly realistic and a number of interesting opportunities continue to remain available; however, only transactions where substantial value can be created for shareholders will be pursued.

The rules require that where an AIM-listed company is an investing company, shareholder approval for its investment strategy must be sought on an annual basis. The Board therefore proposes to seek approval for the Group to continue its current acquisition strategy at the forthcoming annual general meeting on 26 April 2010.  The Board unanimously recommends that shareholders approve the appropriate resolution.

Results

The Group's loss after taxation for the year to 31 December 2009 was £829,056 (2008: £742,495) and was in line with our planned level of expenditure.

Costs incurred to date include £94,650 (2008: £0.49m) in relation to due diligence carried out on acquisition targets by the Group's professional advisers.  We continue to monitor and control costs carefully, with as much initial work as possible carried out by the management team, and we remain rigorous in our approach to ensure that no unnecessary costs are incurred.

As at 31 December 2009, the Group had net cash balances totalling £11.9m (2008: £12.8m).

Dividends

It is the Board's policy that prior to making the first acquisition, no dividends will be paid.  Following the first acquisition, subject to availability of distributable reserves, dividends will be paid to shareholders when the directors believe it is appropriate and prudent to do so.  However, the main focus of the Group will be on delivering capital growth for shareholders.

Outlook

The Group continues to pursue its stated acquisition strategy.  We anticipate that 2010 will present numerous further acquisition opportunities in our target sector.  Certain of these are already under review. 

We believe that Marwyn Materials, with its strong and experienced management team, is well placed to exploit attractive opportunities in the year ahead.

Enquiries:

Marwyn Materials Limited

Peter Tom                                                             020 7389 6800

Simon Vivian                                                          020 7389 6800

Cenkos Securities plc

Nicholas Wells                                                       020 7397 8900

MARWYN MATERIALS LIMITED

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

As at 31 December 2009

	Note	2009		2008
		£		£
Assets
Current assets
Trade and other receivables		11,106		14,195
Cash and cash equivalents	14	11,865,789		12,806,100
Total current assets		11,876,895		12,820,295
Total assets		11,876,895		12,820,295
Equity and liabilities
Capital and reserves
Stated capital	16	13,262,480		13,262,480
Equity-settled employee benefits reserve	16	1,848		680
Accumulated losses	16	(1,571,551)		(742,495)
Equity attributable to owners of the Company		11,692,777		12,520,665
Total equity		11,692,777		12,520,665
Non-current liabilities
Taxation	11	3,909		1,913
Total non-current liabilities		3,909		1,913
Current liabilities
Trade and other payables	15	180,209		297,717
Total current liabilities		180,209		297,717
Total liabilities		184,118		299,630
Total equity and liabilities		11,876,895		12,820,295

The Group and the Company financial statements on pages 9 to 32 were approved and authorised for issue by the Board of Directors on 22 March 2010 and signed on its behalf by:

 

Peter Tom CBE                                                                                                Simon Vivian

Chairman                                                                                                          Chief Executive

MARWYN MATERIALS LIMITED

STATEMENT OF FINANCIAL POSITION

As at 31 December 2009

	Note		2009		2008
			£		£
Assets
Non-current assets
Investment in subsidiaries	12		-		-
Loan to Group company	13		-		100,000
Total non-current assets			100,000		100,000
Current assets
Loan to Group company	13		100,000		-
Trade and other receivables			5,090		10,697
Cash and cash equivalents	14		11,796,210		12,759,709
Total current assets			11,801,300		12,770,406
Total assets			11,901,300		12,870,406
Equity and liabilities
Capital and reserves
Stated capital	16		13,262,480		13,262,480
Equity-settled employee benefits reserve	16		1,848		680
Accumulated losses	16		(1,597,871)		(753,181)
Equity attributable to owners of the Company			11,666,457		12,509,979
Current liabilities
Trade and other payables	15		234,843		360,427
Total current liabilities			234,843		360,427
Total liabilities			234,843		360,427
Total equity and liabilities			11,901,300		12,870,406

MARWYN MATERIALS LIMITED

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the year from 1 January to 31 December 2009

			1 January 2009  to 31 December 2009		15 August 2007 to 31 December 2008
	Note		£		£
Interest income	10		101,767		249,716
Employee expenses	7		(256,086)		(116,764)
Professional and consultancy expenses	8		(508,927)		(761,317)
Other expenses	9		(161,901)		(112,217)
			(926,914)		(990,298)
Results from operating activities			(825,147)		(740,582)
Loss before income tax			(825,147)		(740,582)
Income tax expense	11		(3,909)		(1,913)
Loss for the year/ period			(829,056)		(742,495)
Other comprehensive income			-		-
Total comprehensive income			(829,056)		(742,495)
Attributable to:
Owners of the Company	16		(829,056)		(742,495)
Earnings per share
Basic and diluted loss per share	18		(0.6p)		(1.4p)

All the Group's activities derive from continuing operations.

MARWYN MATERIALS LIMITED

STATEMENT OF COMPREHENSIVE INCOME

For the year from 1 January to 31 December 2009

			1 January 2009 to 31 December 2009		15 August 2007 to 31 December 2008
	Note		£		£
Interest income	10		107,358		250,182
Employee expenses	7		(31,926)		(23,342)
Professional and consultancy expenses	8		(848,779)		(904,587)
Other expenses	9		(71,343)		(75,434)
			(952,048)		(1,003,363)
Results from operating activities			(844,690)		(753,181)
Loss before income tax			(844,690)		(753,181)
Income tax expense	11		-		-
Loss for the year/ period			(844,690)		(753,181)
Other comprehensive income			-		-
Total comprehensive income			(844,690)		(753,181)
Attributable to:
Owners of the Company	16		(844,690)		(753,181)
Earnings per share
Basic and diluted loss per share	18		(0.6p)		(1.4p)

All the Company's activities derive from continuing operations.

 

MARWYN MATERIALS LIMITED

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

	Stated capital	Equity-settled employee benefits reserve	Accumulated losses	Total
	£	£	£	£
Balance at 15 August 2007	-	-	-	-
Total comprehensive income for the period:
Loss for the period	-	-	(742,495)	(742,495)
Transactions with owners recorded directly in equity:
Recognition of share-based payments	-	680	-	680
Issue of ordinary shares	13,600,000	-	-	13,600,000
Costs directly related to the issue of capital	(337,520)	-	-	(337,520)
Total transactions with owners	13,262,480	680	-	13,263,160
Balance at 1 January 2009	13,262,480	680	(742,495)	12,520,665
Total comprehensive income for the year:
Loss for the year	-	-	(829,056)	(829,056)
Transactions with owners recorded directly in equity:
Recognition of share-based payments	-	1,168	-	1,168
Issue of ordinary shares	-	-	-	-
Costs directly related to the issue of capital	-	-	-	-
Total transactions with owners	-	1,168	-	1,168
Balance at 31 December 2009	13,262,480	1,848	(1,571,551)	11,692,777

For more detail of the Group's reserves, see Note 16.

All the Group's activities derive from continuing operations.

MARWYN MATERIALS LIMITED

CONSOLIDATED STATEMENT OF CASH FLOWS

For the year from 1 January to 31 December 2009

		1 January 2009 to 31 December 2009		15 August 2007 to 31 December 2008
	Note	£		£
Cash flows from operating activities:
Interest received		111,355		239,019
Tax paid		(1,913)		-
Payments to suppliers and employees		(1,049,753)		(695,399)
Net cash generated by operating activities		(940,311)		(456,380)
Cash flows from financing activities:
Proceeds from issue of stated capital		-		13,600,000
Payment for share issue costs		-		(337,520)
Net cash from financing activities		-		13,262,480
Net increase in cash and cash equivalents		(940,311)		12,806,100
Cash and cash equivalents on 1 January 2009		12,806,100		-
Cash and cash equivalents at 31 December 2009	14	11,865,789		12,806,100

1.         Reporting entity

Marwyn Materials Limited (the "Company") is a company domiciled in Jersey. The address of the Company's registered office is Elizabeth House, 9 Castle Street, St Helier, Jersey, JE2 3RT.   The Company was incorporated on 15 August 2007.

The financial statements of the Company as at and for the year ended 31 December 2009 comprise the Company and its subsidiaries (together referred to as the "Group" and individually as "Group entities"). The Group primarily is involved in the acquisition of a target investment.

2. Basis of preparation

The financial statements were authorised for issue by the Board of Directors on 22 March 2010.

These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards. The consolidated financial statements have been prepared under the historical cost convention.

(a) Segment reporting

An operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses. The Directors perform regular reviews of the operating results of the Group as a whole and make decisions using financial information at the entity level. Accordingly, the Board believes that the Group has only one operating segment.

(b) Critical accounting estimates and judgements

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

(c) Critical accounting estimates and assumptions

The Group and Company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results.  

(d) Functional and presentation currency

The Group and Company considers Sterling the currency that most faithfully represents the economic effect of the underlying transactions, events and conditions. Sterling is the currency in which the Group and Company measures its performance and reports its results, as well as the currency in which it issues shares to its investors.

2.         Segment information

Business segments

The Company raised GBP£13.26m net of expenses through an issue of ordinary shares on its admission to AIM on 12 June 2008.  Until such time as an acquisition is made, the Group's sole operation will remain the seeking of a suitable target whilst investing shareholders' funds with a focus on investment return balanced by liquidity and market risk. 

Geographical segments

Marwyn Materials Limited is based in Jersey.  The Group has established an operating company in the U.K. to help actively seek an acquisition.  Both in 2009 and 2008, Marwyn Materials Limited generated all of the Group's revenue.

3.         Employee expenses

	2009		2009		2008		2008
	Company		Group		Company		Group
	£		£		£		£
Wages and salaries	-		190,663		-		79,663
Equity-settled share-based payments	1,168		1,168		680		680
Compulsory social security contributions	-		33,497		-		13,759
Non-executive Directors' fees	30,758		30,758		22,662		22,662
	31,926		256,086		23,342		116,764

For details of equity-settled share based payments see note 19.

4.         Professional and consultancy expenses

	2009		2009		2008		2008
	Company		Group		Company		Group
	£		£		£		£
Professional fees	281,134		287,150		293,796		295,018
Consultancy fees	221,776		221,777		466,299		466,299
Consultancy fees paid to Marwyn Materials UK Limited	345,869		-		144,492		-
	848,779		508,927		904,587		761,317

5.         Other expenses

	2009		2009		2008		2008
	Company		Group		Company		Group
	£		£		£		£
Rent	-		55,750		8,000		37,250
Legal fees	34,416		34,416		26,550		26,550
Sundry expenses	36,927		71,735		40,884		48,417
	71,343		161,901		75,434		112,217

Marwyn Materials UK Limited has in place an operating lease for office accommodation with Marwyn Partners Limited until June 2011. Payments made under operating leases were £55,750 during the year (2008:£29,250).  Non-cancellable operating lease rentals are as follows:

	2009		2009		2008		2008
	Company		Group		Company		Group
	£		£		£		£
Less than one year	-		60,000		-		60,000
Between one and five year	-		30,000		-		85,000
More than five years	-		-		-		-
	-		90,000		-		145,000

6.         Interest income

	2009		2009		2008		2008
	Company		Group		Company		Group
	£		£		£		£
Interest income on bank deposits	101,767		101,767		249,716		249,716
Interest on loan to Marwyn Materials UK Limited	5,591		-		466		-
	107,358		101,767		250,182		249,716

7.         Income tax expense

	2009		2009		2008		2008
	Company		Group		Company		Group
	£		£		£		£
Current period tax expense	-		3,909		-		1,913
Income tax expense from continuing operations	-		3,909		-		1,913

Reconciliation of effective tax rate:

	2009		2009		2008		2008
	Company		Group		Company		Group
	£		£		£		£
Loss for the year/ period	(844,690)		(825,147)		(753,181)		(740,582)
Income tax at the Company's domestic rate of 0%	-		-		-		-
Effect of tax rates in foreign jurisdictions*	-		3,909		-		1,913
Income tax expense recognised	-		3,909		-		1,913

*The parent company is resident in Jersey and has a zero percent tax rate.  The Group has a subsidiary operation in the U.K. which pays tax at a higher rate of 20% on taxable profits of £19,756 (2008: £9,566) in the year.

8.         Investment in subsidiaries

Company:

	Principal activity	Country of incorporation	Voting and ownership interest	Cost
Marwyn Materials UK Limited*	Acquisition sourcing	UK	100%	£1.00
Marwyn Materials Investments Limited	Issue of incentive shares	Jersey	100%	£0.02

*Marwyn Materials UK Limited is indirectly held by the Company via Marwyn Materials Investments Limited.

9.         Loan to Group company

Company:

	2009		2008
	£		£
Marwyn Materials UK Limited	100,000		100,000
	100,000		100,000

The loan is unsecured, pays interest at 12m LIBOR plus 150bps and is repayable on 1 December 2010.

10.       Cash and cash equivalents

	2009		2009		2008		2008
	Company		Group		Company		Group
	£		£		£		£
Bank balances	11,796,210		11,865,789		12,759,709		12,806,100
Cash and cash equivalents in the statement of cash flows	11,796,210		11,865,789		12,759,709		12,806,100

The exposure to interest rate risk and a sensitivity analysis for financial assets and liabilities are disclosed in note 20.

11.       Trade and other payables

	2009		2009		2008		2008
	Company		Group		Company		Group
	£		£		£		£
Amount due to Marwyn Materials UK Limited	80,725		-		68,459		-
Liability for Participation Shares	3,500		3,500		3,500		3,500
Other creditors	150,618		176,709		288,468		294,217
	234,843		180,209		360,427		297,717

12.       Capital and reserves

Reconciliation of movement in capital and reserves

Company:	Stated capital	Equity-settled employee benefits reserve	Accumulated losses	Total equity
	£	£	£	£
Opening balance	13,262,480	680	(753,181)	12,509,979
Loss for the year	-	-	(844,690)	(844,690)
Recognition of share-based payments	-	1,168	-	1,168
Balance at 31 December 2009	13,262,480	1,848	(1,597,871)	11,666,457

Group:	Stated capital	Equity-settled employee benefits reserve	Accumulated losses	Total equity
	£	£	£	£
Opening balance	13,262,480	680	(742,495)	12,520,665
Loss for the year	-	-	(829,056)	(829,056)
Recognition of share-based payments	-	1,168	-	1,168
Balance at 31 December 2009	13,262,480	1,848	(1,571,551)	11,692,777

13.       Stated capital

Company and Group:

	Ordinary shares		Ordinary shares
	2009		2008
Issued ordinary shares brought forward	136,000,000		2
Issue of ordinary shares on admission to AIM	-		135,999,998
On issue at 31 December	136,000,000		136,000,000

The Company has no limit to the number of ordinary shares which may be issued.  The ordinary shares have no par value.  All issued shares are fully paid.

The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share at meetings of the Company.

14.       Earnings per share

Group:

Basic earnings per share

The calculation of basic earnings per share of 0.6p loss at 31 December 2009 (2008: 1.4p loss) was based on the loss attributable to ordinary shareholders of £829,056 (2008: £742,495) and a weighted average number of ordinary shares outstanding of 136m (2008: 54.6m). 

Diluted earnings per share 

The calculation of diluted earnings per share of 0.6p loss at 31 December 2009 (2008: 1.4p loss) was based on the loss attributable to ordinary shareholders of £829,056 (2008: £742,495) and the weighted average outstanding ordinary shares of 136m (2008: 54.6m).  The Participation Shares in issuance during the year are not included in the calculation of weighted average outstanding ordinary shares for the diluted earnings per share calculation as the effect is anti-dilutive. 

Company:

Basic earnings per share

The calculation of basic earnings per share of 0.6p loss at 31 December 2009 (2008: 1.4p loss) was based on the loss attributable to ordinary shareholders of £844,690 (2008: £753,181) and a weighted average number of ordinary shares outstanding of 136m (2008: 54.6m). 

Diluted earnings per share 

The calculation of diluted earnings per share of 0.6p loss at 31 December 2009 (2008: 1.4p loss) was based on the loss attributable to ordinary shareholders of £844,690 (2008: £753,181) and the weighted average outstanding ordinary shares of 136m (2008: 54.6m).  The Participation Shares in issuance during the year are not included in the calculation of weighted average outstanding ordinary shares for the diluted earnings per share calculation as the effect is anti-dilutive. 

15.       Share-based payment arrangements

Under share-based payment arrangements established by the Group to incentivise Directors, key employees and others providing similar services, Participation Shares were issued, via the Company's subsidiary, Marwyn Materials Investments Limited, to Directors and key employees ("Management Participation Shares") and Marwyn Management Partners LLP ("Marwyn"), a related party ("Marwyn Participation Shares"); together "the Participation Shares".

On being offered, the Company may purchase the Participation Shares either for cash or for the issue of new ordinary shares at its discretion.  The value of the Participation Shares is discussed below.  The Participation Shares may only be sold on this basis if both the Growth and Vesting Conditions have been satisfied.  If these conditions have not been satisfied the Participation Shares must be sold to the Company for a nominal amount.

Details of the Participation Shares issued during and outstanding at the year end are shown below.  None of the Participation Shares were forfeited, exercised or expired during the year.

Growth Condition

The Growth Condition is that the compound annual growth of the Company's equity value must be at least 12.5% per annum.  The Growth Condition takes into account new shares issued, dividends and capital returned to Shareholders.

Vesting Condition

The Participation Shares are subject to a vesting period ending on 6 June 2011.  If however, the Growth Condition is not met on 6 June 2011, it will be extended to 6 June 2013, or if earlier, when the Growth Condition is met.  The vesting period will also end on the sale or change of control of the Company.

Value

Subject to the provisions detailed above, the Management Participation Shares and Marwyn Participation Shares can each be sold to the Company for an aggregate value equivalent to 10% of the increase in "Shareholder Value" in the Company.  Shareholder Value is broadly defined as the increase in market capitalisation of all Ordinary Shares of the Company issued up to the date of sale, allowing for any dividends and other capital movements.

Management Participation Shares

Under a management incentive scheme, 10,000 Management Participation Shares have been created and Directors and key employees have been allotted and purchased a number of those shares, as shown in the table below. 

The following table shows the Management Participation Shares issued to employees:

Issued to:	Participation in increase in "Shareholder Value"	Issue price	Number of Participation shares	Nominal value of Participation shares
Peter Tom	4%	£0.50	2,000	£1,000
Simon Vivian	4%	£0.50	2,000	£1,000
Ian Peters	2%	£0.50	1,000	£500
			5,000	£2,500

Marwyn Participation Shares

The Group has entered into a performance participation agreement with Marwyn Management Partners LLP ("Marwyn") under which Marwyn has agreed to assist the Company in meeting its business strategy.  In exchange, the Group has issued Participation Shares to Marwyn, a related party, as shown in the table below:

Issued to:	Participation in increase in "Shareholder Value"	Issue price	Number of  Participation shares	Nominal value of Participation shares
Marwyn Management Partners LLP	10%	£0.10	10,000	£1,000

Valuation of Participation Shares

When the Participation Shares were issued, the Company was an unlisted shell-company and had not entered into any transactions up to that date other than the issue of 2 Ordinary Shares for £2.  The fair value estimation placed on the Participation Shares took into account the lack of trading history of the Company and the absence of any deals or transactions to date.  The total amount paid for the Participation Shares, being the nominal value of £3,500, was considered to be the best estimation of the fair value.

In the current year, £1,168 (2008: £680) has been recognised in total as an expense in the Statement of Comprehensive Income in respect of Participation Shares.

16.       Financial instruments

Significant accounting policies

Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of measurement and the basis on which income and expenses are recognised, in respect of each class of financial asset, financial liability and equity instrument are disclosed in note 2.5 to the financial statements.

Categories of financial instruments

Carrying amount of financial assets:

	2009		2009		2008		2008
	£		£		£		£
	Company		Group		Company		Group
Loan and receivables (including cash and cash equivalents)	11,901,300		11,876,895		12,870,406		12,820,295
	11,901,300		11,876,895		12,870,406		12,820,295

Carrying amount of financial liabilities:

	2009		2009		2008		2008
	Company		Group		Company		Group
	£		£		£		£
Amortised cost	234,843		184,118		360,427		299,630
	234,843		184,118		360,427		299,630

Credit risk

Exposure to credit risk

The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk at the reporting date was:

	2009		2009		2008		2008
	Company		Group		Company		Group
	£		£		£		£
Cash and cash equivalents	11,796,210		11,865,789		12,759,709		12,806,100
Loans and receivables	105,090		11,106		110,697		14,195
	11,901,300		11,876,895		12,870,406		12,820,295

Impairment losses

There was no impairment on receivables during the year and there are no overdue or impaired receivables at the year end.

Liquidity risk

The following are the contractual maturities of financial liabilities and excluding the impact of netting agreements:

2009

Company:

	Carrying	Contractual	6 months
	amount	cash flows	or less	2-5 years
Accruals	234,843	234,843	234,843	-
	234,843	234,843	234,843	-

Group:

	Carrying	Contractual	6 months
	amount	cash flows	or less	2-5 years
Accruals	184,118	184,118	180,209	3,909
	184,118	184,118	180,209	3,909

2008

Company:

	Carrying	Contractual	6 months
	amount	cash flows	or less	2-5 years
Accruals	360,427	360,427	360,427	-
	360,427	360,427	360,427	-

Group:

	Carrying	Contractual	6 months
	amount	cash flows	or less	2-5 years
Accruals	299,630	299,630	297,717	1,913
	299,630	299,630	297,717	1,913

Currency risk

Exposure to currency risk

All of the Group's transactions and balances are in Sterling and therefore the Group has no exposure to currency risk.

Interest rate risk

Profile

At the reporting date the interest rate profile of interest-bearing financial instruments was:

 

	2009 Carrying amount		2009 Carrying amount		2008 Carrying amount		2008 Carrying amount
	Company		Group		Company		Group
	£		£		£		£
Fixed rate instruments
Financial assets (time deposits)	11,562,000		11,562,000		12,677,207		12,677,207
	11,562,000		11,562,000		12,677,207		12,677,207
Variable rate instruments
Financial assets	234,210		303,789		82,502		128,893
	234,210		303,789		82,502		128,893

All financial assets and liabilities, other than those shown in the table above are non-interest bearing.

Fair value sensitivity analysis for fixed rate instruments

The Group does not account for any fixed rate financial assets and liabilities at fair value through profit or loss. Therefore a change in interest rates at the reporting date would not affect profit or loss.

Cash flow sensitivity analysis for variable rate instruments

A change of 100 basis points in interest rates at the reporting date would have increased/ (decreased) equity and profit or loss for 12 months on interest-bearing instruments by the amounts shown below. This analysis assumes that all other variables remain constant.

2009	Profit or loss and equity		Profit or loss and equity
	Company	Company	Group	Group
	100 bp increase	100 bp decrease	100 bp increase	100 bp decrease
	£	£	£	£
Time deposits	117,962	(117,962)	118,658	(118,658)

2008	Profit or loss and equity		Profit or loss and equity
	Company	Company	Group	Group
	100 bp increase	100 bp decrease	100 bp increase	100 bp decrease
	£	£	£	£
Time deposits	127,597	(127,597)	128,061	(128,061)

Fair values

Fair values versus carrying amounts

The fair values of financial assets and liabilities, together with the carrying amounts shown in the Statement of Financial Position, are as follows:

2009	Carrying amount	Fair value	Carrying amount	Fair value
	Company	Company	Group	Group
	£	£	£	£
Loans and receivables	105,090	98,330	11,106	11,106
Cash and cash equivalents	11,796,210	11,796,210	11,865,789	11,865,789
Payables	(231,343)	(231,343)	(180,618)	(180,618)
	11,669,957	11,663,197	11,696,277	11,696,277

2008	Carrying amount	Fair value	Carrying amount	Fair value
	Company	Company	Group	Group
	£	£	£	£
Loans and receivables	110,697	102,940	14,195	14,195
Cash and cash equivalents	12,759,709	12,759,709	12,806,100	12,806,100
Payables	(356,927)	(356,927)	(296,132)	(296,132)
	12,513,479	12,505,722	12,524,163	12,524,163

The carrying value of receivables, cash and payables are a reasonable approximation of fair value due to their short-term maturity.  For details of the Participation Shares issued, excluded from the above table, see note 19.

Interest rates used for determining fair value

The interest rate used to discount the redemption cash flow of the loan to the subsidiary is calculated by adding a credit spread to the yield on a UK government bond maturing at 1 year post the reporting date; being the closest date to the loan repayment date.  The subsidiary has received no quotes for commercial loans and therefore has estimated a relevant credit spread based on market knowledge.

		Yield on Government security	Credit spread	Discount rate
Loan to Marwyn Materials UK Limited		4.25%	3%	7.25%

17.       Related parties

Parent and ultimate controlling party

The Company is listed on AIM and as such there is no controlling party.

Marwyn Investment Management LLP is the investment manager to Marwyn Value Investors LP which has a significant shareholding in the Company.  James Corsellis is a partner in Marwyn Investment Management LLP and a director of various Marwyn Group companies.  David Williams is a partner in Marwyn Investment Management LLP.  The following Marwyn companies are therefore deemed to be related parties of the Group:

Marwyn Partners Limited was paid GBP£60,000 (2008:£25,000) (excluding VAT) in respect of office accommodation and Marwyn Capital LLP was paid GBP£180,000 (2008:£100,000) in respect of corporate finance and administrative services.   At the Statement of Financial Position date Marwyn Partners Limited and Marwyn Capital LLP were owed an amount of £10,000 (2008:£20,000) and £30,000 (2008:£NIL) respectively in respect of services supplied during the year.

At the Statement of Financial Position date Marwyn Value Investors LP held 50,010,000 ordinary shares in Marwyn Materials Limited.  Marwyn Management Partners LLP held Marwyn Participation Shares in the Group, details of which are disclosed in note 19.

Transactions with directors

As well as the Management Participation Share disclosed in note 19, the Group also made the following payments to Directors or companies connected with Directors:

	Payments for services during the year		Amounts owed at year end		Payments for services during the period		Amounts owed at period end
	2009		2009		2008		2008
	£		£		£		£
Consultancy fees	315,360		30,000		97,531		-
Director salary payments	120,000		-		50,000		10,000
Non-executive fees	30,758		3,888		22,662		4,166
	466,118		33,888		170,193		14,166

Directors' shareholdings

The following Directors held the indicated number of shares in the Company as at the year end:

Director:	Shares held at 31 December 2009		Shares held at 31 December 2008
Peter Tom CBE	22,350,000		22,350,000
Simon Vivian	2,500,000		2,500,000
David Williams	11,000,000		11,000,000
James Corsellis	5,500,000		5,500,000
David Warr	2,500,000		2,500,000

 

END

 

 

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