Cubus Lux plc
30 September 2005
CUBUS LUX PLC
INTERIMS FOR THE SIX MONTHS ENDED 30 JUNE 2005
CHAIRMAN'S STATEMENT
I am pleased to submit results for the six months ended 30 June 2005 and my
first report as Chairman of the company. I assumed this position as of 19 July
2005.
Operations
The first half of 2005 saw the opening of our third casino in Rabac in Istria
Peninsula. Although this opening cements our position as the leading casino
operator in Istria, we need to do even more to attract gaming enthusiasts and
semi-professional players (junkets) into our casinos. We are addressing this
issue with an operational restructuring of the casino operation in Croatia and
reinforcing our marketing resources. We hope to begin to see the impact of this
by mid-2006.
Financial
For the six months ending 30 June 2005, the group is reporting revenues of
£191,000 and net loss of £168,000. Our results are below expectations, due to an
increase in our administrative expenses as a result of operating as a public
company, which was not matched by an increase in revenues due to a below budget
junket business. We have implemented corrective action and we expect an
improvement in results in 2006 and beyond.
Personnel
As of 19 July 2005 I was appointed executive chairman and Michael Janssen was
appointed as a non-executive director.
Our plans for the future
We intend to reposition the Company from a casino operator into the number one
tourist company in Croatia and we want to establish operations which are
complementary to gaming. These may include marinas and hotels especially golf
hotels.
GERHARD HUBER
Executive Chairman
30 September 2005
CUBUS LUX PLC
GROUP PROFIT AND LOSS ACCOUNT
FOR THE SIX MONTHS ENDED 30 JUNE 2005
Six months to Six months to Year to 31
30 June 2005 30 June 2004 December 2004
Unaudited Unaudited Audited
Note £'000 £'000 £'000
TURNOVER 1,2 191 168 484
Cost of sales (24) (22) (58)
------------- ------------- -------------
GROSS PROFIT 167 146 426
Administrative expenses (314) (221) (886)
------------- ------------- -------------
OPERATING LOSS (147) (75) (460)
Interest receivable - - 14
Interest payable (21) (5) (7)
-------------- -------------- -------------
LOSS ON ORDINARY
ACTIVITIES BEFORE TAXATION (168) (80) (453)
Tax on loss on ordinary activities 3 - - -
------------- ------------- -------------
RETAINED LOSS (168) (80) (453)
====== ====== ======
LOSS PER SHARE
Basic and diluted 7 0.76p 0.50p 2.41p
====== ====== ======
GROUP STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
Six months to Six months to Year to 31
30 June 2005 30 June 2004 December 2004
Unaudited Unaudited Audited
£'000 £'000 £'000
Loss for the financial period (168) (80) (453)
Exchange rate movements 17 - (8)
------------- ------------- -------------
Total recognised losses relating to the year (151) (80) (461)
====== ====== ======
GROUP BALANCE SHEET
AT 30 JUNE 2005
Notes As at 30 June As at 30 June As at 31
2005 2004 December 2004
Unaudited Unaudited Audited
£'000 £'000 £'000
FIXED ASSETS
Tangible assets 4 632 237 594
------------- ------------- ------------
CURRENT ASSETS
Stock 35 3 6
Debtors 218 31 54
Cash at bank 357 253 385
------------- ------------- ------------
610 287 445
CREDITORS: amounts falling
due within one year (626) (609) (361)
------------- ------------- ------------
NET CURRENT (LIABILITIES)/ASSETS (16) (322) 84
-------------- -------------- ------------
TOTAL ASSETS LESS
CURRENT LIABILITIES 616 (85) 678
CREDITORS: amounts falling
due after one year (229) - (140)
-------------- -------------- ------------
387 (85) 538
====== ====== =====
CAPITAL AND RESERVES
Called up share capital 5 223 161 223
Share premium 1,101 - 1,101
Other reserve 6 - 159 -
Merger reserve 6 347 347 347
Profit and loss account 6 (1,284) (752) (1,133)
------------- ------------- -------------
EQUITY SHAREHOLDERS' FUNDS 387 (85) 538
======= ====== ======
GROUP CASH FLOW STATEMENT
FOR THE SIX MONTHS ENDED 30 JUNE 2005
Six months to Six months to Year to 31
30 June 2005 30 June 2004 December 2004
Unaudited Unaudited Audited
£'000 £'000 £'000
Operating loss (147) (75) (460)
Loss on disposal of fixed assets - - 21
Depreciation 50 24 61
Increase in debtors (164) (28) (51)
Increase in stock (29) - (3)
Increase/(decrease) in creditors 354 (6) 92
-------------- -------------- ---------------
CASH INFLOW/(OUTFLOW) FROM OPERATING ACTIVITIES
64 (85) (340)
Return on investment and servicing of finance (21) - 7
Capital expenditure and financial investment (88) (35) (426)
-------------- -------------- ---------------
CASH OUTFLOW BEFORE FINANCING (45) (120) (759)
FINANCING
Issue of shares in Cubus Lux Plc (net of issue costs) - - 1,004
Net loans received - 285 60
--------------- --------------- --------------
(DECREASE)/INCREASE IN CASH IN THE PERIOD (45) 165 305
======= ====== ======
RECONCILIATION OF NET CASH FLOW TO NET FUNDS/(DEBT)
FOR THE SIX MONTHS ENDED 30 JUNE 2005
Six months to Six months to Year to 31
30 June 2005 30 June 2004 December 2004
Unaudited Unaudited Audited
£'000 £'000 £'000
(Decrease)/increase in cash in the period (45) 165 305
Cash inflow from movement in debt - (285) (60)
Exchange differences 17 - (8)
New finance leases undertaken in period - - (24)
Loans converted to shares in Cubus Lux d.o.o. - - 310
------------- ------------- -------------
Movement in net (debt)/funds in the period (28) (120) 523
Net funds/(debt) at beginning of period 232 (294) (291)
------------- ------------- -------------
Net funds/(debt) at end of period 204 (414) 232
====== ====== ======
RECONCILIATION OF MOVEMENTS IN GROUP SHAREHOLDERS' DEFICIT
FOR THE SIX MONTHS ENDED 30 JUNE 2005
Six months to Six months to Year ended
30 June 30 June 31 December
2005 2004 2004
Unaudited Unaudited Audited
£'000 £'000 £'000
Loss for the financial period (168) (80) (453)
--------------- --------------- ---------------
(168) (80) (453)
Exchange rate differences 17 - (8)
New shares issued in Cubus Lux Plc (net of issue costs) - 310 1,004
New shares issued in Cubus Lux d.o.o. (net of issue - - 310
costs)
--------------- --------------- ---------------
Net movement in shareholders' (deficit)/funds (151) 230 853
Opening shareholders' funds/(deficit) 538 (315) (315)
--------------- --------------- ---------------
Closing shareholders' funds/(deficit) 387 (85) 538
======= ======= =======
NOTES TO THE REPORT AND FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2005
1. ACCOUNTING POLICIES
(a) Basis of Preparation
The financial information is prepared on the historical cost basis in accordance
with the applicable accounting standards.
It comprises the consolidated financial information of Cubus Lux Plc and its
subsidiary.
(b) Basis of Consolidation
On 20 May 2004, the company purchased 100% of the issued share
capital of Cubus Lux d.o.o., a company registered in the Commercial Court in
Rijeka, Croatia, by way of a share for share exchange. Under Financial
Reporting Standard 6, merger accounting has been adopted as the basis of
consolidation.
(c) Depreciation
Depreciation is provided at rates calculated to write off the
cost less estimated residual value of each asset by equal monthly instalments
over its expected useful life as follows:-
Motor Vehicles 25% per annum
Office furniture, computers and casino equipment 10-25% per annum
(d) Stocks
Stocks are valued at the lower of cost and net realisable value.
(e) Foreign Currencies
Transactions in foreign currencies are recorded at the rate of
exchange at the date of the transaction. The results and balance sheets of
overseas operations are translated at the rate of exchange rating at the balance
sheet date. The rate of exchange used at 30 June 2005 was 10.9449 HRK to £1
(2004: 10.839 HRK to £1).
(f) Turnover
Turnover represents the invoiced amount of goods sold and services provided in
the year, net of value added tax.
2. BUSINESS SEGMENT ANALYSIS
The turnover, loss on ordinary activities before taxation and net assets of the
Group, all of which occur in the Republic of Croatia, are attributable to one
activity, that of the operation of a casino.
3. TAXATION
The Company is controlled and managed by its Board in Croatia. Accordingly, the
interaction of UK domestic tax rules and the taxation agreement entered into
between the U.K. and Croatia operate so as to treat the Company as solely
resident for tax purposes in Croatia. The Company undertakes no business
activity in the UK such as might result in a Permanent Establishment for tax
purposes and accordingly has no liability to UK corporation tax.
4. LOSS PER SHARE
The loss per share of 0.76p (31 December 2004: 2.41p; 30 June 2004: 0.50p) has
been calculated on the weighted average number of shares in issue during the
year namely 22,102,001 (31 December 2004: 18,772,476; 30 June 2004: 15,949,801)
and losses of £167,985 (31 December 2004: £453,452; 30 June 2004: £80,464).
FRS 14 requires presentation of diluted EPS when a company could be called upon
to issue shares that would decrease net profit or increase net loss per share.
For a loss making company with outstanding share options, net loss per share
would only be increased by the exercise of out-of-the-money options. Since it is
inappropriate to assume that option holders would act irrationally, no
adjustment is made to diluted EPS for out-of-the-money share options.
5. DIVIDEND
The Directors do not recommend the payment of a dividend.
This information is provided by RNS
The company news service from the London Stock Exchange
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