Osprey Communications PLC
1 December 2000
Osprey Communications plc
Final Results for the Eighteen Months ended 31 March 2000
Chairman's Statement
This has been a particularly difficult period for the Group. The financial
results for the extended period of trading covering the eighteen months ended
31 March 2000 show a loss of £1.39m. This is after charging £176,000 net
interest payable and exceptional charges of £382,000 relating to the re-
organisation of the London operations and redundancies. The Group had
extended its year-end because we were pursuing the possibility of a reverse
take-over of HLM Architects Limited. The outcome depended upon raising
substantial funs. Unfortunately, partly because of the prevailing market
conditions this proved impossible.
The Group has faced many difficulties during the period and several important
and urgent decisions have already been taken to improve the Group's
profitability. There are still a number of steps that need to be
successfully undertaken if we are to achieve our goal.
In September 2000 the business and assets of Osprey London Limited were sold
to Interfocus Group Limited for an initial consideration of £750,000. Future
payments on this transaction are expected to be received up to a maximum of
£1.25m. However, this is entirely dependent on the future revenues of the
former clients of Osprey London Limited. The initial consideration was
largely used to reduce the secured overdraft from National Westminster Bank
Plc. As there are insufficient funds to meet Osprey London's remaining
creditors, and the deferred consideration payments are due by 30 September
2001, it was decided to place Osprey London Limited under a Corporate
Voluntary Arrangement.
Chris Still, until recently, Chief Executive of the Group and Lester Corney a
Group Director have both joined Interfocus Limited and have therefore
resigned form the Board. During September 2000 both Dennis Murphy and Alex
Hammond Chambers submitted resignations. I would like to thank them for
their contribution over the years. We wish them well in their new
endeavours.
The Group sold the business of Osprey Lime Limited for an initial
consideration of £140,000. Further receipts are unlikely. The Group sold
the business assets and liabilities of Osprey Future Image Limited to
management for a total consideration of £80,000, receivable over 12 months.
I have resumed the role of Executive Chairman and have appointed Munir Samji
as Director of the Group. Mr Samji was at one time finance director of
Dorland Advertising Limited and Joint Managing Director of Saatchi and
Saatchi Advertising Europe. We are now working together in a determined
effort to restore the Group's prospects.
Following the disposal of Osprey London's business, we have moved out of
Central London to smaller offices in Wembley. This move has assisted us in a
significant reduction in our ongoing overheads.
We are in the course of raising further funding to provide a platform for
future developments as well as to reduce our indebtedness. Funds will also
be needed to support the two remaining businesses, Osprey RMA Limited and
Osprey Scotland Limited, both of which are trading profitably.
Osprey RMA Limited in particular has, despite the difficulties of the Group,
shown itself to be particularly robust. Its profits for the period of this
report were £530,000 before head office recharges. Recently its profits have
been further enhanced through the addition of new business.
Along with this Annual Report & Accounts, we are sending to each shareholder
a Document that sets out proposals for a Capital Reorganisation, Open Offer
for new ordinary shares, Capitalisation of Loans, Reduction of Capital and
Admission to trading on the Alternative Investment Market. We are also
seeking your approval for the appointment of Stephen Barclay as a non-
executive Director. Mr Barclay is Executive Vice Chairman of Seymour Pierce
Group Plc. We believe that these measures, if approved, will stabilise the
position of the Group, and enable your Board to pursue other courses of
action to take the Group forward. AS the Open Offer for new ordinary shares
has been fully underwritten, the Accounts for the period ended 31 March 2000
have been prepared on a 'going-concern' basis.
J Rubins, Chairman
1 December 2000
Consolidated Profit and Loss Account
Eighteen
Months Year
ended ended
31 March 30
2000 September
1998
£000 £000
Turnover 25,374 24,313
Cost of sales (16,231) (16,333)
Gross Profit 9,143 7,980
Administrative expenses (10,356) (8,216)
Operating loss and loss on ordinary
activities before interest (1,213) (236)
Net interest payable (176) (113)
Loss on ordinary activities before (1,389) (349)
taxation
Tax charge on loss on ordinary 1 (67)
activities
Loss for the period (1,390) (416)
Basic and diluted loss per share (4.62)p (1.39)p
The results for the Group for the period related entirely to continuing
operations within the meaning of Financial Reporting Standard No. 3.
Consolidated Balance Sheets
At 31 At 30
March September
2000 1998
£000 £000
Fixed Assets
Tangible assets 611 876
Current Assets
Work in progress 197 414
Debtors 2,455 4,085
2,652 4,499
Creditors
amounts falling due within one year (5,688) (6,548)
Net current liabilities (3,036) (2,049)
Total assets less current (2,425) (1,173)
liabilities
Creditors
amounts falling due after more than - (2)
one year
Net liabilities (2,425) (1,175)
Capital and reserves
Called up share capital 7,516 7,516
Share premium account 438 438
Shares to be issued - 250
Profit and loss account (10,379) (9,379)
Equity shareholders deficit (2,425) (1,175)
Consolidated Cash Flow Statement
Eighteen
Months Year ended
ended 30
31 March September
2000 1998
£000 £000
Net cash inflow from operating 457 597
activities
Return on investments and servicing (176) (101)
of finance
Taxation (68) -
Capital expenditure and financial (236) (236)
investment
Acquisitions and disposals (10) (2)
Net cash inflow/(outflow) before (33) 258
financing
Financing
Capital element of finance lease
and hire purchase rentals (27) (74)
Loans received/(repaid) from 150 (216)
Directors
Receipt/(repayment) of other loans 300 (71)
Net cash inflow/(outflow) from 423 (361)
financing
Increase/(decrease) in cash 390 (103)
1. The results have been prepared under the historical cost convention and
in accordance with applicable accounting standards using accounting policies
that have been applied consistently.
2. The financial information set out above does not constitute the
Company's statutory accounts for the 18 month period ended 31 March 2000. The
information relating to the year ended 30 September 1998 has been extracted
from the 1998 Annual Report and Accounts which received an unqualified
auditors' report and have been delivered to the Registrar of Companies.
3. The Report and Accounts for the period ended 31 march 2000 have been
prepared and will be mailed to shareholders on 1 December 2000 and copies
will be available from York House, Empire Way, Wembley, Middlesex HA9 0PA.
For further information please contact;
Osprey Communications plc 020 8795 4559
Jack Rubins
Munir Samji
Seymour Pierce Limited 020 7648 8700
Sarah Wharry