Final Results
CCH International plc
21 June 2006
Press Release 21 June 2006
CCH International plc
('CCH' or 'the Company' or 'the Group')
Final results for the fourteen months ended 31 December 2005
CCH International plc (AIM: CCH), the trade finance group, today announces its
final results for the fourteen months ended 31 December 2005.
Highlights
• pre-tax profit increased significantly to £689,554 (2004: £37,116)
• gross profit increased more than five times to £2,382,570 (2004: £451,495)
• earnings per share increased to 1.21 pence (2004: 0.08 pence)
• swift integration of CCH Europe GmbH and CCH Holdings SPC in Bahrain
• financed more than £142million (US$250 million) of short term receivables
in 2005
• expert in Sharia-based instruments and Islamic Finance
Highlights from the current trading period
• A$80 million five-year trade finance facility signed with Bill Express
Limited
• signed a one year US$30 million export finance facility with Basaran Gida
Ticaret ve Turizm Isletmeleri
• commitment to increase liquidity in the Company's shares this year
Commenting on the 2005 final results, Eren Nil, Managing Director of CCH, said:
'These results represent a very good performance for the Group. We have had
good deal flow and this has translated into strong profitability. Furthermore
we are pleased that there is increasing market appetite for our Sharia compliant
trade financing services. We look forward to increasing liquidity in our shares
and delivering ongoing growth for our shareholders.'
- ends -
For further information, please contact:
CCH International plc www.cch-international.com
Eren Nil, Managing Director Tel: +44 (0) 20 8334 0871
Richard Fossett, Director and COO
eren@cch-international.com
r.fossett@cch-international.com
Media enquiries:
Abchurch Communications www.abchurch-group.com
Heather Salmond / Franziska Bohnke Tel: +44 (0) 20 7398 7700
franziska.boehnke@abchurch-group.com
Chairman's statement
The Board is pleased to announce that the Group's pre tax profit for the 14
months ended 31 December 2005 has increased to £689,554 which represents a
dramatic increase over the 2004 pre-tax profit of £37,116. The Group's gross
profit increased to £2,382,570 from £451,495. Basic earnings per share increased
to 1.21 pence from 0.08 pence.
CCH enjoyed significant market growth during the course of 2005 which, assisted
by the effects of streamlining the Group's operating structure during 2003/2004,
has resulted in a significant upturn in profits. This success also reflects the
swift integration of CCH Europe GmbH into the Group which has strengthened our
core activities. The addition of CCH Holdings SPC in Bahrain also gave us a
foothold in the all-important Gulf Co-Operation Council (GCC) which comprises
Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and The United Arab Emirates. We
expect this to provide new opportunities both in strengthening our existing
relationships and providing occasions when we can consider holding proprietary
equity positions.
Our key funding base, which is entrenched in Sharia compliant Islamic Finance,
has become the focus of much discussion recently in the press. It is evident
that as a by-product of the huge liquidity in the GCC, Sharia compliant
instruments such as those offered by CCH are at the forefront of a new wave of
Trade Finance opportunities which are set to grow. CCH believes that with our in
depth knowledge of Islamic Finance we are in an excellent position to capitalise
on this anticipated growth. Moving forward, our strategy also benefits from our
ability to identify, analyse and respond quickly to Trade Finance opportunities.
I would like to thank all our partners with whom we network, our shareholders
who share our vision, and my fellow directors without whose contribution our
accelerated growth would not have been possible
Ian Salter
Chairman
Managing Director's statement
It is with great pleasure that I am able to report to our shareholders a record
period for your Company.
During the period, CCH focused primarily on its two main complementary finance
activities. These are the short-term receivable financing facilities offered
mainly by CCH Europe GmbH based in Dusseldorf, and the short to long term trade
and project finance facilities provided to a very great extent in a Sharia
compliant Islamic structure.
Our short term receivable financing activities are funded to a very significant
level by Islamic banks based in the Middle East although we are increasingly
being offered conventional funding lines from banks operating in Europe. In line
with our own conservative approach to credit risk we fully insure the
receivables we finance against non-payment with some of the World's largest
insurance companies.
We do not restrict our receivable financing activities to any one area or
industry on account of the non-payment insurance that we purchase. As such we
have a wide industry and geographical spread of receivables. A further advantage
in purchasing insurance is that we are effectively using the credit analysis
skills of our insurers, thereby managing to control your Company's head count
and related staffing costs.
During the period we financed in excess of £142 Million (US$250 Million) of
short term receivables.
When I report to you during the next year, I am confident that this figure will
be significantly higher.
Historically our short to long term trade and project finance activities have
been provided to companies known to directors or shareholders of the Group.
Increasingly however, through an expanded use of third party finance
intermediaries we are being approached to finance 'new relationships'. This is a
very positive and encouraging trend that I believe results from an increased
awareness of the Company's activities and our ability, through the use of our
Islamic funding base, to structure transactions more in keeping with customers'
beliefs and wishes than traditional conventional finance sources.
Looking towards the future we will continue to seek opportunities to expand the
Company's core activities and thereby increase shareholder value through organic
growth and acquisitions.
It is the intention of the Board of Directors to increase liquidity in the
Company's shares during the course of this year. 2006 has started positively and
the Board of Directors looks forward with confidence to the future.
Finally I would like to congratulate and thank all those who have contributed to
the Company's advancement and I would like to acknowledge the strong support
shown to the Company by our funding partners.
Eren Nil
Managing Director
GROUP PROFIT AND LOSS ACCOUNT
PERIOD FROM 1 NOVEMBER 2004 TO 31 DECEMBER 2005
Year to
31 Dec 05 31 Oct 04
Note £ £
GROUP TURNOVER 4,837,011 992,193
Cost of sales (2,454,441) (540,698)
----------- -----------
GROSS PROFIT 2,382,570 451,495
Distribution costs (140,537) -
Administrative expenses (1,551,935) (412,698)
----------- -----------
OPERATING PROFIT 690,098 38,797
Interest receivable 11,559 145
Interest payable and similar charges (12,103) (1,826)
----------- -----------
PROFIT ON ORDINARY ACTIVITIES BEFORE 689,554 37,116
TAXATION
Tax credit on profit on ordinary 93,132 -
activities
----------- -----------
PROFIT FOR THE FINANCIAL PERIOD 2 782,686 37,116
=========== ===========
Earnings per ordinary share (pence) 3 1.21 0.08
=========== ===========
All of the activities of the group are classed as continuing.
The company has taken advantage of section 230 of the Companies Act 1985
not to publish its own Profit and Loss Account.
GROUP BALANCE SHEET
31 DECEMBER 2005
31 Dec 05 31 Oct 04
Note £ £ £ £
FIXED ASSETS
Intangible assets 549,658 -
Tangible assets 120,714 228,913
Investments 6 49,949 -
----------- -----------
720,321 228,913
CURRENT ASSETS
Debtors 94,713,444 310,346
Cash at bank and in hand 8,391,898 119,320
----------- -----------
103,105,342 429,666
CREDITORS: Amounts falling 101,484,794 85,134
due within one year
----------- -----------
NET CURRENT ASSETS 1,620,548 344,532
----------- -----------
TOTAL ASSETS LESS CURRENT LIABILITIES 2,340,869 573,445
=========== ===========
CAPITAL AND RESERVES
Called-up share capital 1,441,269 1,044,444
Share premium account 4 1,211,266 417,615
Other reserves 4 94,262 -
Profit and loss account 4 (405,928) (888,614)
----------- -----------
2,340,869 573,445
=========== ===========
SHAREHOLDERS' FUNDS: 5
Equity 1,740,869 (26,555)
Non-equity 600,000 600,000
----------- -----------
2,340,869 573,445
=========== ===========
COMPANY BALANCE SHEET
31 DECEMBER 2005
31 Dec 05 31 Oct 04
Note £ £ £ £
FIXED ASSETS
Tangible assets 95,639 228,913
Investments 6 1,333,210 -
----------- -----------
1,428,849 228,913
CURRENT ASSETS
Debtors 525,558 310,346
Cash at bank 110,847 119,320
----------- -----------
636,405 429,666
CREDITORS: Amounts falling 130,857 85,134
due within one year
----------- -----------
NET CURRENT ASSETS 505,548 344,532
----------- -----------
TOTAL ASSETS LESS CURRENT LIABILITIES 1,934,397 573,445
=========== ===========
CAPITAL AND RESERVES
Called-up share capital 1,441,269 1,044,444
Share premium account 4 1,211,266 417,615
Profit and loss account 4 (718,138) (888,614)
----------- -----------
1,934,397 573,445
=========== ===========
SHAREHOLDERS' FUNDS:
Equity 1,334,397 (26,555)
Non-equity 600,000 600,000
----------- -----------
1,934,397 573,445
=========== ===========
GROUP CASH FLOW STATEMENT
PERIOD FROM 1 NOVEMBER 2004 TO 31 DECEMBER 2005
Year to
31 Dec 05 31 Oct 04
Note £ £ £ £
NET CASH (OUTFLOW)/INFLOW FROM (39,432,856) 90,259
OPERATING ACTIVITIES
RETURNS ON INVESTMENTS AND
SERVICING OF FINANCE
Interest received 11,559 145
Interest paid (12,103) (1,826)
----------- -----------
NET CASH OUTFLOW FROM RETURNS (544) (1,681)
ON INVESTMENTS AND SERVICING OF
FINANCE
CAPITAL EXPENDITURE AND FINANCIAL INVESTMENT
Net inflow from tangible fixed 210 -
assets
Acquisition of investments (49,949) -
----------- -----------
NET CASH OUTFLOW FOR CAPITAL (49,739) -
EXPENDITURE AND FINANCIAL
INVESTMENT
ACQUISITIONS AND DISPOSALS
Legal fees on acquisition of (68,960) -
subsidiary
Net cash acquired with 2,096,759 -
subsidiary
----------- -----------
NET CASH INFLOW FROM 2,027,799 -
ACQUISITIONS AND DISPOSALS
----------- -----------
CASH (OUTFLOW)/INFLOW BEFORE (37,455,340) 88,578
FINANCING
FINANCING
Increase in bank loans 45,447,805 -
----------- -----------
NET CASH INFLOW FROM FINANCING 45,447,805 -
INCREASE IN CASH 7,992,465 88,578
=========== ===========
GROUP CASH FLOW STATEMENT (continued)
RECONCILIATION OF OPERATING PROFIT TO NET CASH (OUTFLOW)/INFLOW
FROM OPERATING ACTIVITIES
Year to
31 Dec 05 31 Oct 04
£ £
Operating profit 690,098 38,797
Amortisation 18,952 -
Depreciation 140,055 115,171
Foreign exchange gains (70,737) -
Profit on disposal of fixed assets (210) -
(Increase)/decrease in debtors (53,040,762) 10,827
Increase/(decrease) in creditors 12,829,748 (74,536)
----------- -----------
Net cash (outflow)/inflow from operating (39,432,856) 90,259
activities
=========== ===========
NOTES TO THE FINANCIAL STATEMENT
PERIOD FROM 1 NOVEMBER 2004 TO 31 DECEMBER 2005
1. STATUS OF INFORMATION
The financial information presented in this preliminary announcement does not
constitute statutory accounts within the meaning of the Companies Act 1985. The
information has however been extracted from the Company's statutory accounts
which were approved by the Board on 20 June 2006 and on which the Company's
auditors have given an unqualified audit opinion.
The comparative figures for 2004 have been extracted from the statutory accounts
for the year ended 31 October 2004. The statutory accounts for the year ended
31 October 2004 have been filed with the Registrar of Companies and the
auditors' opinion on these accounts was unqualified.
2. PROFIT ATTRIBUTABLE TO MEMBERS OF THE PARENT COMPANY
The profit dealt with in the accounts of the parent company was £170,476 (2004 -
£37,116).
3. EARNINGS PER SHARE
14 Months Year to
to
31 Dec 05 31 Oct 04
pence Pence
Earnings per ordinary share 1.21 0.08
=========== ===========
Basic earnings per share is based on the profit after tax of £782,686
(2004:£37,116) and the weighted average number of shares in issue and held
outside the group of 64,480,498 (2004 - 44,444,444).
4. RESERVES
Group Share Currency Profit and
premium reserve loss account
account
£ £ £
Balance brought forward 417,615 - (888,614)
Retained profit for the period - - 782,686
Other movements
New equity share capital 793,651 - -
subscribed
Shares held by subsidiary - - (300,000)
Exchange differences on - 94,262 -
retranslation of net assets of
subsidiary undertakings
----------- ----------- -----------
Balance carried forward 1,211,266 94,262 (405,928)
=========== =========== ===========
Company Share Profit and
premium loss account
account
£ £
Balance brought forward 417,615 (888,614)
Profit for the period - 170,476
Other movements
New equity share capital subscribed 793,651 -
----------- -----------
Balance carried forward 1,211,266 (718,138)
=========== ===========
5. RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
EQUITY SHAREHOLDERS' FUNDS
31 Dec 05 31 Oct 04
£ £ £ £
Profit for the financial 782,686 37,116
period
New equity share capital 396,825 -
issued
Shares held by subsidiary (300,000) -
undertaking
Premium on new share capital 793,651 -
subscribed
Exchange differences on 94,262 -
retranslation of net assets
of subsidiary undertakings
----------- -----------
Net addition to shareholders' 1,767,424 37,116
equity deficit
Opening shareholders' equity deficit (26,555) (63,671)
----------- -----------
Closing shareholders' equity funds/ 1,740,869 (26,555)
(deficit)
=========== ===========
NON-EQUITY SHAREHOLDERS' FUNDS
Opening and closing shareholders' 600,000 600,000
non-equity funds
=========== ===========
TOTAL SHAREHOLDERS' FUNDS 2,340,869 573,445
=========== ===========
6. INVESTMENTS
Group Listed
companies
£
COST
Additions 49,949
-----------
At 31 December 2005 49,949
===========
NET BOOK VALUE
At 31 December 2005 49,949
===========
The market value of listed investments at 31 December 2005 was £52,890
Company
Country of Holding Proportion Nature of business
incorporation of voting
rights and
shares
held
Subsidiary undertakings
All held by the company:
CCH Europe GmbH Germany Ordinary 100% Trade finance
shares
CCH Holdings Bahrain Ordinary 100% Investment
SPC shares
Group
companies
£
COST
Additions 1,333,210
-----------
At 31 December 2005 1,333,210
===========
NET BOOK VALUE
At 31 December 2005 1,333,210
===========
On 10 May 2005 the Company acquired CCH Europe GmbH for a consideration
of £1,190,476 satisfied by the issue of 39,682,539 new ordinary 1p shares at 3p
per share. Goodwill arising on the acquisition of CCH Europe GmbH has been
capitalised and will be amortised over 20 years. The investment in CCH Europe
GmbH has been included in the company's balance sheet at its fair value at the
date of acquisition.
Analysis of the acquisition of CCH Europe GmbH:
Fair value
and Book
value
£
Cash at bank and in hand 2,096,759
Fixed assets and investments 245,495
Debtors 41,035,236
Creditors (42,686,664)
-----------
690,826
===========
Satisfied by:
Shares issued 1,190,476
===========
CCH Europe GmbH earned a profit of £761,790 in the year ended 31
December 2005 (2004 - £224,431), of which £688,249 arose in the period from 10
May 2005 to 31 December 2005. The summarised profit and loss account for this
period is as follows:
Turnover 4,397,750
===========
Profit before tax 922,217
Taxation 233,968
-----------
Profit for the period from 10 May to 31 December 2005 688,249
===========
On 17 September 2005 the group formed CCH Holdings SPC, a company
registered in the Kingdom of Bahrain, for a consideration of £73,744 satisfied
by cash. There was no Goodwill arising on the formation of CCH Holdings SPC. The
investment in CCH Holdings SPC has been included in the company's balance sheet
at the cost of shares issued on inception.
CCH Holdings SPC incurred a loss during the period of £53,818.
7. DIVIDENDS
The Directors are not declaring a dividend in respect of the period ended
31 December 2005.
8. ANNUAL REPORT AND FINANCIAL STATEMENTS
Copies of the Annual Report and Financial Statements will be circulated to
shareholders shortly and may be viewed after the posting date on the Company's
web-site 'www.cch- international.com'
This information is provided by RNS
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