Final Results

RNS Number : 4858J

CSS Stellar PLC

30 June 2011

 



For Immediate Release

CSS Stellar plc

("CSS Stellar" or the "Group")

Final Audited Results

CSS Stellar today announces its final audited results for the year ended 31 December 2010.

Highlights:

·    Operating loss from continuing operations prior to impairment of goodwill of £0.2 million (2009: loss of £0.6 million)

·    All significant trading activities ceased

·    Company now an investing business

·    Continued reduction in corporate overheads

·    Group continues to be debt free

For further information please contact:

CSS Stellar plc
Julian Jakobi	Tel: [phone]
Northland Capital Partners Limited  (Nominated Adviser and Broker)
Luke Cairns / Edward Hutton	Tel: [phone]

CHAIRMAN'S STATEMENT                                                                                           

Overview

In 2010, the Company disposed of its 50% share in the business and assets of its golf management business Hambric Stellar Golf Limited and ceased to undertake its motorsports client business. As a result, it effectively ceased to own, control or conduct any trading business. As such, the Company was deemed under Rule 15 of the AIM Rules to be an investing company. It was necessary to adopt an investing policy, shareholder approval of which was obtained in March 2011.

The Company retains an interest in the motorsports client business, a business which is now undertaken by a company ("GPSH") wholly-owned by myself with a former consultant to the Company. Further details of the arrangements between the Company and GPSH as announced in December 2010 are set out in the Operating and Financial Review below.

Investing Policy

The Company's investing policy, approved at the General Meeting in March 2011, is to focus on making an acquisition or acquisitions of unquoted businesses or companies which would constitute a reverse takeover under Rule 14 of the AIM Rules, creating a platform for further acquisitions.  The Directors retain the flexibility to make investments which do not constitute a reverse takeover under Rule 14 of the AIM Rules where shareholder value can be enhanced; in such cases, however, any investments will be significant minority stakes in companies which are actively managed and which serve as a platform for a future reverse takeover.

The strategy of the Directors is to pursue acquisition(s) in the leisure, corporate services, consultancy and brand licensing sectors which will allow the Board to leverage its knowledge, experience and contacts.  Suitable acquisitions outside these sectors will also be considered.

In conjunction with following the investing policy, the Directors will proactively consider raising additional funds, either in the form of equity or debt, to help implement the proposed investing policy.

The Directors will focus primarily on acquisition opportunities within the European Union and the United States. It is anticipated that returns to shareholders will be delivered primarily through an appreciation in the Company's share price.

The Board is aware that the Company's cash resources, currently standing at approximately £80,000, are limited and this may restrict the extent to which the investing policy can be implemented. However, the Board continues to evaluate opportunities to make acquisitions within the scope of the investing policy.

Financial Results

Revenue from continuing operations for the Group of £0.3 million was 295% higher than the prior year (2009: £0.08 million) due the receipt of a legal case settlement.  Group operating loss prior to the impairment of goodwill of £0.4 million was £0.2 million, which was reduced from 2009.  There was a net loss from discontinued operations of £0.8million (2009: £0.9million) recognised during the year.

Corporate overheads

The level of ongoing corporate overheads has been reduced and the Group continues to identify opportunities to further reduce these costs. It is forecast that corporate overheads in 2011 will be further reduced.

Board changes

There were no board changes during the year.

Future strategy

CSS Presenters Limited remains the Group's only trading business and as such is now deemed to be an investing business. The Group has budgeted for a much lower cost base in 2011 whilst it seeks other business opportunities.

I should like to thank all of our employees for their efforts and support during the past year.

Julian Jakobi    

Chairman   

30 June 2011

OPERATING AND FINANCIAL REVIEW       

Group Review of 2010                                                                                  

Revenue from continuing operations for the Group in the year ended 31 December 2010 was £0.3 million, a 295% increase from 2009 (£0.08 million). These are adhoc revenues resulting from one off events.

Group operating loss on continuing operations prior to the impairment of goodwill of £0.4 million was £0.2 million, which was broadly in line with 2009.  There was a net loss from discontinued operations of £0.8million (2009: £0.9million) recognised during the year.

Review of continuing operations

The Group's trading operations now consists only of CSS Presenters. This company made an operating loss prior to impairment of goodwill of £0.14 million (2009: loss of £0.05 million) on revenue of £0.02 million (2009 £0.02 million).  There was an impairment of goodwill of £0.4million relating to this business. 

Discontinued Operations

During the year, the Board took the decision to cease all of its trading activities in the Motorsports and Golf core areas. These businesses were based on contracts that were due to end during the year ended 31 December 2010 and there was no certainty that these contracts would be renewed.

Disposal of European Golf Business

On 30 September 2010, the Group disposed of its European Golf Business via a trade and assets disposal.

Cessation of motorsports

On 17 December 2010 the group announced that it had entered into arrangement with GP Sports Holdings Limited ("GPSH"), a company wholly owned by Julian Jakobi the company's chairman, whereby the group ceased to undertake its motor sport client business (the "Arrangements").  As part of the Arrangements, the company agreed to terminate Julian Jakobi's consultancy and executive arrangements and to waive the non compete clause and the 12 month notice period. 

Under the Arrangements, GPSH are providing receivables collection services for contracted fees through to 2012.  The group will also have a 20% carried economic interest in GPSH which will entitle it to a cash payment based on what the group would have received it has a 20% share holding in GPSH.  Further details of these arrangements are included in the announcement dated 17 December 2010.

The motorsports client business was built entirely around the client representation agreements, all of which were due to expire on 31 December 2010 with the exception of an agreement with one client which is due to expire on 31 December 2011.  The costs associated with servicing these agreements, the fact that there was no certainty of any renewal, together with the unrelated public company costs, lead the board to conclude that the continuation of the motor sports client business was no longer viable nor in shareholders' interests.

Julian Jakobi, by virtue of being a director and substantial shareholder of the Company, was deemed a related party for the purposes of the Arrangements.  The directors, other than Mr Jakobi who took no part in the board's consideration of the Arrangements, considered, having consulted with Northland Capital Partners Limited, the Company's Nominated Adviser, that the Arrangements were fair and reasonable in so far as the shareholders of the Company were concerned.

Adoption of Investing Policy

Under the Arrangements, the group effectively ceased to own, control or conduct any of its existing trading business and as a result was deemed an investing company for the purposes of the AIM Rules for Companies.  Pursuant to Rule 15 of the AIM Rules, a circular to adopt an Investing Policy was passed without amendment at a general meeting of the Company on 15 March 2011.                                                                                  

Goodwill                                                                                             

In accordance with IAS 36, the Board reviewed the carrying value of goodwill held in the Balance Sheet for impairment. As a result of the review, the Board concluded that a write down of £0.4 million is required relating to CSS Presenters.

Taxation                                                                                            

The Group's tax charge was £Nil (2009: credit of £24,000).     

Loss per Share                                                                                              

Loss per share on continuing operations on a basic and fully diluted basis shows a loss of 2.24p per share (2009: loss of 1.88p). Basic unadjusted and fully diluted earnings per share on discontinued operations were a profit of 2.83p (2009: loss of 2.95p).  The losses are due to the impact of the disposals and the impairment write down booked in the year.

Cash Flow                                                                                          

The cash flow statement shows a decrease in cash of £0.18 million (2009: decrease of £0.3 million) as a consequence of the closure of its trading activities.

Julian Jakobi   

Chairman    

30 June 2011

CONSOLIDATED INCOME STATEMENT
Year ended 31 December 2010
			2010		2009
	Notes		£000		£000
Revenue	3		324		82
Cost of sales			-		-
Gross profit			324		82
Impairment of goodwill			(402)		-
Other administrative costs			(572)		(632)
Total administrative costs			(974)		(632)
Operating loss			(650)		(550)
Finance income			-		1
Finance costs			-		(22)
Loss before tax			(650)		(571)
Income tax credit/(expense)			-		24
Net loss from continuing operations			(650)		(547)
Net loss from discontinued operations	5		(819)		(854)
Net loss for the year			(1,469)		(1,401)
Attributable to:
Equity holders of the parent			(1,469)		(1,401)
Loss per share (pence)	4		pence		pence
Continuing operations
Basic and diluted loss per share			(2.24)		(1.88)
Discontinued operations
Basic and diluted loss per share			(2.83)		(2.95)
Total
Basic and diluted loss per share			(5.07)		(4.83)
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
			£000		£000
Loss for the year			(1,469)		(1,401)
Exchange differences on translation of foreign operations			(1)		(9)
Total comprehensive income for the year			(1,470)		(1,410)
Attributable to:
Equity holders of the parent			(1,470)		(1,410)

STATEMENT OF FINANCIAL POSITION
As at 31 December 2010
			2010		2010		2009		2009
			£000		£000		£000		£000
ASSETS
Non-current assets
Property, plant and equipment			4				12
Goodwill			-				402
Available for sale assets			152				-
					156				414
Current assets
Trade and other receivables			375				1,242
Cash and cash equivalents			6				188
					381				1,430
Disposal group classified as held for resale					239				-
Total assets					776				1,844
EQUITY
Equity attributable to equity holders of the parent
Share capital			14,488				14,488
Share premium account			28,158				28,158
Translation reserve			31				(120)
Profit and loss account			(42,533)				(41,064)
Total equity					144				1,462
LIABILITIES
Current liabilities
Trade and other payables			418				357
Current tax payable			-				25
			418				382
Liabilities directly associated with disposal group classified as held for resale			214
Total liabilities					632				382
Total equity and liabilities					776				1,844

CONSOLIDATED STATEMENT OF CASH FLOWS
Year ended 31 December 2010
		2010		2010		2009		2009
		£000		£000		£000		£000
Cash flows from operating activities
Loss after taxation				(1,469)				(1,401)
Adjustments for:
Depreciation		6				8
Impairment of goodwill		400				500
Net interest expense		-				21
Taxation credit/(expense) recognised in profit and loss		-				(24)
Change in trade and other receivables		678				1,196
Change in trade and other payables		234				(925)
Income taxes paid		-				(88)
				1,318				688
Net cash used in operating activities				(151)				(713)
Cash flows from investing activities
Purchase of property, plant and equipment		-				(4)
Proceeds from sale of investments		-				12
Proceeds from sale of subsidiaries		-				340
Reclassification of cash held in disposal group		(32)				-
Proceeds from sale of property, plant and equipment		-				17
Interest received		-				1
Net cash generated by investing activities				(32)				366
Cash flows from financing activities
Interest paid		-				(22)
Net cash used in financing activities								(22)
Net change in cash and cash equivalents				(183)				(369)
Exchange loss/(gain) on cash and cash equivalents				1				33
Cash and cash equivalents at beginning of period				188				524
Cash and cash equivalents at end of period				6				188

STATEMENT OF CHANGES IN EQUITY
Year ended 31 December 2010

	Share capital	Share premium	Other Reserve	Retained earnings	Total attributable to owners of parent
	£'000	£'000	£'000	£'000	£'000
Balance at 1 January 2010	14,488	28,158	(120)	(41,064)	1,462
Loss for the year	-	-	-	(1,469)	(1,469)
Other comprehensive income:
Exchange differences on translation of foreign operations	-	-	152 (1)	-	152 (1)
Total comprehensive income for the year	-	-	151	(1,469)	(1,318)
Balance at 31 December 2010	14,488	28,158	31	(42,533)	144

	Share capital	Share premium	Other Reserve	Retained earnings	Total attributable to owners of parent
	£'000	£'000	£'000	£'000	£'000
Balance at 1 January 2009	14,488	28,158	(111)	(39,663)	2,872
Loss for the year	-	-	-	(1,401)	(1,401)
Other comprehensive income:
Exchange differences on translation of foreign operations	-	-	(9)	-	(9)
Deferred tax on revaluation of freehold property	-	-	-	-	-
Total comprehensive income for the year	-	-	(9)	(1,401)	(1,410)
Balance at 31 December 2009	14,488	28,158	(120)	(41,064)	1,462

NOTES TO THE FINANCIAL INFORMATION
Year ended 31 December 2010

1. Basis of preparation

CSS Stellar plc is a company incorporated in the United Kingdom. The Group financial statements are for the year ended 31 December 2010 and have been prepared under the historical cost convention, except for revaluation of certain properties and financial instruments.

These consolidated financial statements (the financial statements) have been prepared and approved by the directors in accordance with International Financial Reporting Standards as adopted by the EU ("adopted IFRS").                                                                                                          

The principal accounting policies of the Group are set out in the Group's 2009 Annual Report and Financial Statements.  These policies have remained unchanged.

2.   Financial Information

The financial information relating to the year ended 31 December 2010 set out in this announcement does not constitute Statutory Accounts as defined in Section 435 of the Companies Act 2006, but has been extracted from the statutory accounts, which have received an unqualified auditors' report and which have not yet been with the Registrar of Companies. The financial information relating to the period ended 31 December 2009 is extracted from the statutory accounts, which incorporated an unqualified audit report and which has been filed with the Registrar of Companies.

3.  Segmental Reporting

During the year all of the Group's major operating segments were either disposed of or ceased to trade. Accordingly no segmental information has been presented other than that of Continuing and Discontinued activities.

Following the disposals and cessation of the group's major trading businesses the group is operating as one segment, represented as continuing operations in the income statement.  All information regarding discontinued operations has been given in note 5.

4.Loss Per Share
		Weighted average					Basic per share
				no. of shares				amount (pence)
2010	£000
Continuing operations
Loss after tax	(650)
Earnings attributable to ordinary shareholders	(650)
Weighted average number of shares				28,976,581				(2.24)
Discontinued operations
Loss after tax	(819)
Earnings attributable to ordinary shareholders	(819)
Weighted average number of shares				28,976,581				(2.83)
Total basic and diluted loss per share								(5.07)
2009
Continuing operations
Loss after tax	(547)
Earnings attributable to ordinary shareholders	(547)
Weighted average number of shares				28,976,581				(1.88)
Discontinued operations
Loss after tax	(854)
Earnings attributable to ordinary shareholders	(854)
Weighted average number of shares				28,976,581				(2.95)
Total basic and diluted loss per share								(4.83)

5.  Net loss from discontinued operations

On 30 September 2010, the Board disposed of its European golf business and on 31 December 2010 ceased its Motorsports client business. As a consequence of this decision, revenue and expenses, gains and losses relating to these businesses have been eliminated from the Group's continuing results and presented as a single line item on the face of the income statement (see "net loss from discontinued operations"). The comparative income statement has been represented to show the discontinued operations separately from continuing operations. The operating results for these businesses are summarised below.

Prior year disposals

In 2009, the Board closed its New York based promotions business. These results are described in detail in the 2009 Report and Financial Statements, and are shown below for comparative purposes.

Operating activities of discontinued operations

	GEM	Sports	Golf	Total	GEM	Sports	Golf	Total
	2010	2010	2010	2010	2009	2009	2009	2009
	£000	£000	£000	£000	£000	£000	£000	£000
Revenue	175	1,074	76	1,325	359	1,050	286	1,695
Cost of sales	-	-	-	-	-	-	-	-
Gross profit	175	1,074	76	1,325	359	1,050	286	1,695
Impairment of goodwill	-	-	-	-	(200)	(300)	-	(500)
Administrative costs	(208)	(1,785)	(151)	(2,144)	(1,035)	(722)	(292)	(2,049)
Operating (loss)/profit	(33)	(711)	(75)	(819)	(876)	28	(6)	(854)
Finance income	-	-	-	-	-	-	-	-
Finance costs	-	-	-	-	-	-	-	-
(Loss)/profit before tax	(33)	(711)	(75)	(819)	(876)	28	(6)	(854)
Income tax expense	-	-	-	-	-	-	-	-
(Loss)/profit for the year	(33)	(711)	(75)	(819)	(876)	28	(6)	(854)
(Loss)/profit on disposal	-	-	-	-	-	-	-	-
Net result from discontinued operations	(33)	(711)	(75)	(819)	(876)	28	(6)	(854)

 

END

 

 

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