Nine month interim results
Starvest PLC
12 July 2007
Starvest plc
Interim report - nine months ended 30 June 2007
Chairman's statement
Investment report
In view of the exceptional developments over the past months culminating in the
successful takeover of African Platinum plc, your board has decided to issue a
second interim report covering the nine months ended 30 June 2007. Therefore, I
am pleased to report continuing successful trading during which Starvest has
achieved the following:
• Pre-tax profit of £4.972m on turnover of £5.494m.
• Basic earnings of 9.45 pence per share; fully diluted earnings of 8.21 pence
per share.
• Increase in the value of trade investments of £7.1m since 30 September 2006
to £19.2m at 30 June 2007, an increase of 59%.
• Fully diluted underlying net asset value per share of 47.4 pence at 30 June
2007 when the Company's share price discount to net asset value was 33%.
All these values are based on mid-market closing prices on a fully diluted pre
tax basis.
• Share price increase of 87% since 30 September 2006 from 17 pence to close
at 31.75 pence.
• 30 June 2007 cash balance of £4.172m
• Closing market capitalisation £11.5m.
• Unrealised profits as at 30 June 2007 of £13.5m before tax, up from £8.9m at
30 September 2006.
In addition to matters mentioned in the half year report to 31 March 2007,
during the quarter to 30 June 2007 the following are of note:
• The Company has made further investments as follows:
o Belmore Resources (Holdings) plc - additional investment;
o Durango Gold plc - gold-silver in the Durango state, Mexico with
exploration rights over 12,072 hectares; PLUS admission expected
during 2007;
o Goliath Resources Inc. - copper, gold and molybdenum exploration
and mining company which has recently led a consortium to acquire
the rights to 152 million tonnes of pre-1980 tailings dumps in
Kitwe Zambia; other assets include two highly prospective gold,
copper and bismuth properties one of which is jointly held with
Phelps Dodge;
o Lotus Resources plc - a rapidly developing portfolio of production
properties, with some exploration, in China to include gold, silver
and copper with a strategy reflecting Chinese government policy and
enjoying a strong Chinese based team; PLUS admission is expected
third quarter 2007 with AIM IPO in early 2008;
o Oracle Coalfields plc - coal mining in Pakistan - additional
investment; PLUS admission expected shortly.
• As announced in the half year report, a significant development during the
period concerns African Platinum plc ('Afplats') a company exploring for
platinum group metals in Southern Africa in which the Company invested prior
to Afplats being admitted to AIM in May 2002. On 16 February 2007, Impala
Platinum Holdings Limited ('Implats') announced a recommended cash offer for
the entire issued share capital of Afplats. Having sold a large part of its
investment at various times in the past, on 30 May 2007 the Company received
cash of £4,537,500 in respect of the remaining holding.
• After a tax provision of approximately £1.5m, the Company has substantial
cash resources for future investment including share buy-backs and dividends.
• On 20 June 2007, the Company paid a maiden special dividend of one penny per
share to shareholders on the register on 25 May 2007.
• A further 450,000 shares were bought for treasury during the period at 30
pence per share; 950,000 shares are now held in treasury.
• Starvest now holds investments in twenty-eight companies of which fifteen
are traded on AIM, eight on PLUS Markets, one on the Toronto exchange and
one on the US based Pink Sheets; the remainder are preparing for admission
to PLUS. The companies are listed at the end of this announcement. The
Board continues to be most satisfied with progress in its portfolio of
investments.
• Both resolutions before the Members in Extraordinary General Meeting held on
23 May 2007 were duly passed.
Starvest will continue to closely evaluate new investment proposals received
from businesses, mainly in the natural resources sector. We will seek to ensure
that they accord with the Company's medium to long term investment strategy.
Further information
Those Shareholders who wish to receive electronic copies of regulatory
announcements are invited to register their email address on the home page of
the Company website: www.starvest.co.uk. Previous reports, quarterly updates
and announcements are available from the site.
Your Board continues to look to the future with optimism; unless there are
exceptional developments the next net asset value announcement is expected on
Monday 1 October. This will be followed by an announcement of the full year's
results no later than 31 October with the 2007 annual general meeting on
Wednesday 12 December 2007.
Thank you for your continued support.
R Bruce Rowan
Chairman & Chief Executive
12 July 2007
Profit & Loss Account
for the nine month period ended 30 June 2007
9 months to Period
30 June 2007 1 August 2005
to
30 September 2006
Unaudited Audited
£,000 £,000
Operating income 5,494 1,699
Direct costs (264) (97)
Gross profit 5,230 1,602
Administrative expenses (220) (267)
Operating profit on ordinary activities 5,010 1,335
Interest receivable 22 7
Interest payable (60) (4)
Profit before taxation 4,972 1,338
Tax on profit on ordinary activities (1,487) (400)
Profit on ordinary activities after 3,485 938
taxation
Dividends paid (367) -
Retained profit for the period 3,118 938
Earnings per share - basic 9.45 pence 2.5 pence
Earnings per share - fully diluted 8.21 pence 2.2 pence
There are no recognised gains or losses in either year period than the profit
for the period.
All of the operations are considered to be continuing.
Balance Sheet
As at 30 June 2007
9 months to Period ended
30 June 2007 30 September 2006
Unaudited Audited
£,000 £,000
Fixed assets 0 0
Current assets
Debtors 16 108
Trading investments 3,919 3,083
Cash at bank and in hand 4,172 -
8,107 3,191
Creditors - amounts falling due within one year
Other creditors (2,574) (554)
Net current assets 5,533 2,637
Total assets less current liabilities 5,533 2,637
Capital and reserves
Called up share capital 372 372
Share premium account 2,026 2,026
Shares held in treasury (222) 0
Profit and loss account 3,357 239
Equity shareholders' funds 5,533 2,637
Reconciliation of Movement in Shareholders' Funds
9 months to 30 June Period 1 August 2006
2007 to 30 September 2006
Unaudited Audited
£,000 £,000
Total recognised profits relating to the period 3,485 938
Dividends paid (367) -
Purchase of own shares for Treasury - see note 3 (222)
Increase in shareholders' funds 2,896 938
Opening shareholders' funds 2,637 1,699
Closing shareholders' funds 5,533 2,637
Interim report notes
1. Interim report
The information relating to the nine month period to 30 June 2007 is unaudited.
The information relating to the period ended 30 September 2006 is extracted from
the audited accounts of the Company which have been filed at Companies House and
on which the auditors issued an unqualified audit report.
2. Basis of accounting
The report has been prepared using accounting policies that are consistent with
those adopted by the Company in the statutory accounts for the fourteen month
period ended 30 September 2006, although the information does not constitute
statutory accounts within the meaning of section 240 of the Companies Act 1985.
The Company will report again for the full year to 30 September 2007.
The Company's investments are carried at the lower of cost or mid market value
at 30 June 2007. For the purpose of the net asset value calculation, with one
exception, the Company's investments at 30 June 2007 are valued at mid market
price. The exception relates to Concorde Oil & Gas plc which, as a matter of
prudence, has been valued at 50% against the closing price on 24 November 2006,
being the date on which trading in the shares was suspended at the request of
the company.
3. Share buy back
The company has bought its own shares to be held in Treasury as follows:
• On 16 January 2007, 500,000 at a price of 17 pence.
• On 29 May 2007, 250,000 at a price of 30 pence.
• On 13 June 2007, 200,000 at a price of 30 pence.
Consequently, shareholders' funds were reduced by £222,204.
4. Investment commitments
At 30 June 2007, the Company had entered into commitments to make investments in
companies for amounts totalling £450,000.
5. Earnings per share
9 months to 30 Period 1 August
June 2007 2006 to 30
September 2006
Unaudited Audited
£,000 £,000
These have been calculated on a profit of: 3,485 938
The weighted average number of shares used was: 36,890,336 37,217,259
The weighted average number of shares and
outstanding options used was: 42,465,336 42,792,259
Basic profit per share: 9.45 pence 2.5 pence
Fully diluted profit per share: 8.21 pence 2.2 pence
Investment portfolio
Starvest now holds trade investments in the following companies:
• Addworth plc Active capital investment company
www.addworth.co.uk
• Agricola Resources plc Platinum and uranium exploration
www.agricolaresources.com
• Belmore Resources (Holdings) plc Zinc exploration in Eire and Northern Ireland
www.belmoreresources.com
• Beowulf Mining plc Gold and copper exploration in Sweden
www.beowulfmining.com
• Black Rock Oil & Gas plc Oil and gas in Southern England, Colombia and
Australia
www.blackrockoil.com
• Brazilian Diamonds Limited Diamond exploration in Brazil
www.braziliandiamonds.com
• Carpathian Resources Limited Oil and gas exploration in Central Europe
www.carpathian.com.au
• Concorde Oil & Gas plc Operational oil and gas projects in the Russian
Federation
• The Core Business plc Personal care and beauty products
www.thecorebusiness co.uk
• DTT plc Driver training and recruitment services to the
road haulage industry
www.drivertransporttraining.co.uk
• Durango Gold plc Gold & silver in Durango State Mexico
• Franchise Investment Strategies plc Franchise consultancy and investment
• Franconia Minerals Corporation North American minerals
www.franconiaminerals.com
• Fundy Minerals Limited Gold and base metal exploration in Canada and West
Africa
www.fundyminerals.com
• Gippsland Limited Tantulum exploration in Egypt
www.gippslandltd.com.au
• Goliath Resources Inc. Copper, gold & molybdenum in Canada; mining in
Zambia
www.goliathresources.com
• Greatland Gold plc Gold exploration in Western Australia and Tasmania
www.greatlandgold.com
• Hidefield Gold plc Gold exploration in North and South America
www.hidefield.co.uk
• India Star Energy plc Oil and gas investments
• Kefi Minerals plc Mineral exploration in Bulgaria and Turkey
www.kefi-minerals.com
• Lotus Resources plc Gold, silver and copper in China
• Myhome International plc Domestic services franchiser
www.myhomeplc.com
• Oracle Coalfields plc Coal mining in Pakistan
www.oraclecoalfields.com
• Red Rock Resources plc Iron ore and manganese exploration in Australia and
Zambia; uranium exploration in Malawi
www.rrrplc.com
• Regency Mines plc Copper & nickel exploration in Australia and Papua
New Guinea
www.regency-mines.com
• Sheba Exploration (UK) plc Gold exploration in Ethiopia
www.shebagold.com
• St Helens Capital plc Corporate finance advisor
www.sthelenscapital.com
• Sunrise Diamonds plc Diamond exploration in Finland
www.sunrisediamonds.com
Copies of the interim report, which is being posted to shareholders, are
available free of charge by application in writing to the Company Secretary at
the Company's registered office, 123 Goldsworth Road, Woking, GU21 6LR, by
email to email@starvest.co.uk or from the Company's website at
www.starvest.co.uk.
Enquiries to:
Bruce Rowan, Chairman 020 7486 3997 or
John Watkins, Finance Director 01483 771992; john@starvest.co.uk
Gerry Beaney or Colin Aaronson, Grant Thornton Corporate Finance 020 7383 5100
12 July 2007
End
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