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Alexander David Investments PL (ADI)

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Friday 28 September, 2012

Alexander David Investments PL

Half-yearly report

Half-yearly report

28 September 2012

 

Alexander David Investments PLC

("ADI" or the "Company")

Half Yearly Report

Chairman's statement

These results include a 100% provision against our investment in Evergreen Oil Plc which stood at £176,798 at the end of last year following their announcement on 15 August 2012 that trading in their shares has been suspended pending clarification of their financial position.  Without the write down on Evergreen there would have been a small profit on our portfolio return for the half year.  This would compare quite favourably with a fall of 6% in the FTSE AIM All Share Super Sector Oil and Gas over the period of the interims. The complete write down of Evergreen, however, means there is a loss on the portfolio of £166,000.  We await further news from Evergreen.

Administrative expenses for the 6 month period were £132,000 for the half year and this compares with £90,000 for four and a half months of the previous half year. It is difficult to see how these can be reduced significantly.  The costs involved are primarily either essential services associated with the Company's listing on the AIM market of the London Stock Exchange or indirectly associated costs such as legal and audit and accountancy costs.

It has been the Directors continuously expressed view that the Company should seek additional funded opportunities for the Company. The Board continues to make progress in reviewing such possible opportunities and will communicate as appropriate with shareholders.  

Percy W Lomax
27 September 2012

Profit and Loss Account
For the six months ended 30 June 2012

 Six months ended
30 June
2012
Six months ended
30 June
 2011
Year
ended
31 Dec 2011
CONTINUING OPERATIONSNote£'000 £'000 £'000
 
Gross portfolio return (166) (21) (82)
 
Administrative expenses (132) (602) (696)
 
Operating loss (298) (623) (778)
Continuing operations  (298) (111) (289)
Discontinued operations  - (512) (489)
 
Loss on ordinary activities before taxation (298) (111) (778)
 
Taxation 4- - -
 
Loss for the period/year  (298) (623) (778)
 
 
 
Earnings per share 
Basic and diluted loss per share 8(0.07)p (0.20)p (0.22)p
Basic and diluted loss per share on continuing operations 8(0.07)p (0.04)p (0.08)p
Basic and diluted loss per share on discontinued operations 8- (0.16)p (0.14)p
 

Note of Historical Cost Profits and Losses
for the six months ended 31 December 2011

 
Reported loss for the period/year before taxation (298) (623) (778)

Fair value adjustment in respect of investments held at fair value through the profit and loss  212 32 76

Historical cost loss on ordinary activities before and after taxation (86) (591) (702)
 

Balance Sheet
As at 30 June 2012

 30 Jun
2012
30 Jun
2011
31 Dec
2011
Note£'000 £'000 £'000
 
Fixed assets 
Other investments 5262 150 163
 
Total fixed assets 262 150 163
 
Current assets 
Trade and other debtors  7 16 7
Other investments 678 241 422
Cash and cash equivalents  46 464 33
 
Total current assets 131 721 462
 
Total assets 393 871 625
 
Current liabilities 
Trade and other creditors  94 176 100
 
Nat current assets 37 545 362
 
 
Net assets 299695525
 
Equity and reserves 
Share capital 76,647 6,643 6,643
Share premium 714,354 14,286 14,286
Share-based payment reserve  86 95 86
Retained earnings 9(20,788) (20,329) (20,490)
 
Total equity and reserves attributable to owners of the parent 299695525
 

Cashflow Statement
For the six months ended 30 June 2012

 

Six months ended
30 June
2012
Six months ended
30 June
2011
Year
ended
 31 Dec 2011
£'000 £'000 £'000
Operating activities
Loss after tax for the period - continued (298) (623) (778)
Adjustments for:
Payment in shares - - (14)
Convertible loan interest (9) - (13)
Fair value adjustment 212 32 76
Share option charge - 95 86
Operating cash flows before movements in working capital and provisions(95) (496) (643)
Increase in debtors - (16) (7)
(Decrease)/increase in creditors (6) 176 -
Movement in working capital from discontinued operations - (297) (203)
Net cash flows from operating activities(101) (633) (853)
Investing activities
Net purchase of investments (86) (319) (744)
Sale of investments 218 46 260
Convertible loans (90) (150) (150)
Net cash flows used in investing activities42 (423) (634)
Cash flows from financing activities
Net proceeds from issue of shares 72 1,520 1,520
Net cash flows from financing activities72 1,520 1,520
Net increase in cash and cash equivalents13 464 33
Cash and cash equivalent at the beginning of the period/year33 - -
Cash and cash equivalent at the end of the period46 464 33

Notes to the financial information
For the six months ended 30 June 2012

1.        GENERAL INFORMATION

Alexander David Investments PLC ("ADI" or "the Company") is an investing company quoted on AIM (LSE: ADI). ADI's investment targets are small cap and special opportunities with a current bias towards basic resources and oil and gas companies, predominately on AIM. Such investments will focus on new and secondary equity issues but may also include some pre-IPO investments.

ADI was incorporated in England and Wales on 11 February 1998 (registration no. 3508592), its registered office at 90 Fetter Lane, London EC4A 1EQ.  Its principal country of operations is the United Kingdom.

The operations of ADI are not affected by seasonal variations.

2.        BASIS OF PREPARATION

These interim financial statements have been prepared in accordance with UK Generally Accepted Accounting Practice with adoption of fair value and therefore FRS 25, FRS 26 and FRS 29 have been fully adopted.

The same accounting policies, presentation and methods of computation have been followed in these unaudited interim financial statements as those which were applied in the preparation of the   Company's annual financial statements for the year ended 31 December 2011.

The interim financial statement for the 6 months ended 30 June 2012 was approved by the Directors on 27 September 2012.

3.        CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

The Company makes certain estimates and assumptions regarding the future. Estimates and judgements are continually evaluated based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. In the future, actual experience may differ from these estimates and assumptions. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below

                Valuation of unquoted investments
In estimating the fair value for an investment, the Company applies a methodology that is
appropriate in light of the nature, facts and circumstances of the investment and its materiality
in the context of the total investment portfolio using reasonable data, market inputs,
assumptions and estimates.

        The valuation of private equity investments is inherently subjective, based as it is on forward looking estimates and judgments. Whilst most valuations provide useful interim indications of the progress of a particular investment or portfolio of investments, ultimately it is not until realisation that true performance is finally determined

4.        TAXATION

No charge to taxation arises in the period ended 30 June 2012 (30 June 2011: nil, 31 December 2011: nil).

No related deferred tax asset has been recognised on the losses due to the unpredictability of future profit streams. Losses may be carried forward indefinitely and may be recoverable if relevant taxable profit arises in future periods.

5.        FIXED ASSETS - OTHER INVESTMENTS

30 June 201230 June 201131 December 2011
£'000 £'000 £'000
Principal 240 150 150
Accrued interest 22 - 13
262 150 163

As part of the demerger arrangements the Company agreed to lend up to £240,000 to its former subsidiary undertaking, Regen Therapeutics Limited ("RTL"), in the form of a convertible loan with 10 per cent coupon.  The loan is not due for repayment until after February 2014 at which point it becomes repayable upon demand.  RTL is an unlisted company engaged in the manufacture and sale of Colostrinin TM.  NAC Lott serves as a director of RTL as a personal appointment and not as a nominee of the Company.  

At the balance sheet date RTL had drawn down the full facility of £240,000. Based on the most recent price at which shares in RTL have been traded, should the Company exercise its conversion rights in relation to loan balance outstanding, the resultant equity issue would result in the Company owning approximately 37 per cent of the issued share capital of RTL.  

The outstanding amount of the loan plus unaccrued interest thereon is included in investments at fair value through profit and loss because the conversion rights attaching to the loan are not considered to be a long term participating interest in the equity of RTL for the purpose of securing a contribution to the Company's activities by the exercise of control or influence arising from or related to that interest. The Company does not exercise significant influence through active involvement or the exercise of influence in the direction of RTL, its policy decisions or decisions on strategic issues, whether relevant to the Company and its investment and conversion rights or not.  When the convertible loan was issued to RTL conversion was not expected.  

6.        OTHER INVESTMENTS AT FAIR VALUE THROUGH PROFIT OR LOSS

30 June 2012
£'000
Balance as at 1 January 2012 422
Additions 86
Disposals (218)
Fair value through profit and loss (212)
Balance as at 30 June 2011 78

7.        SHARE CAPITAL

        30 Jun        31 Dec
        2012        2011
        £'000        £'000

 

Called up share capital issued and fully paid
443,072,512 ordinary shares of 0.01p each
(2011 - 401,030,716 ordinary shares of 0.01p each)        44        40
13,068,521 deferred B shares of 9.99p each        1,305        1,305
108,121,391 deferred A shares of 4.9p each        5,298        5,298
        __________        __________

        6,647        6,643
        __________        __________

Deferred shares do not carry voting rights and have no right to receive dividends. Deferred shareholders are entitled to receive the amount paid up or credited as paid up on their respective holdings of deferred shares only after there has been paid on each ordinary share the nominal amount paid up on such share plus a further £1,000,000 per ordinary share.  The holders of the deferred shares shall not be entitled to participate further in any distribution of the assets or the capital of the Company.

Number of
Shares
Share Capital
£'000
Share Premium
£'000
Called-up and fully paid ordinary shares of 0.01p
at 1 Jan 2012
401,030,716 40 14,286
Ordinary shares issued on 23 January 2012 6,735 - -
Ordinary shares issued on 3 February 2012 20,000 - -
Ordinary shares issued on 8 February 2012 64,396 - 1
Ordinary shares issued on 22 March 2012 25,015 - -
Ordinary shares issued on 19 April 2012 2,795 - -
Ordinary shares issued on 30 April 2012 41,922,448 4 67
Ordinary shares issued on 1 May 2012 207 - -
Ordinary shares issued on 9 May 2012 200 - -
Called-up and fully paid ordinary shares of 0.01p each
at 30 June 2012
443,072,512 44 14,354

On 23 January 2012, the Company issued 6,735 ordinary shares of 0.01p each at a premium of 0.49p per share for a consideration of £33.68 pursuant to the exercise of warrants.

On 3 February 2012, the Company issued 20,000 ordinary shares of 0.01p each at a premium of 0.49p per share for a consideration of £100 pursuant to the exercise of warrants.

On 8 February 2012, the Company issued 64,396 ordinary shares of 0.01p each at a premium of 0.49p per share for a consideration of £321.98 pursuant to the exercise of warrants.

On 22 March 2012, the Company issued 25,015 ordinary shares of 0.01p each at a premium of 0.49p per share for a consideration of £125.08 pursuant to the exercise of warrants.

On 19 April 2012, the Company issued 2,795 ordinary shares of 0.01p each at a premium of 0.49p per share for a consideration of £13.99 pursuant to the exercise of warrants.

On 30 April 2012, the Company issued 41,922,448 ordinary shares of 0.01p each at a premium of 0.16p per share for a consideration of £71,268 to acquire a portfolio of investments from Griffin Two Limited.

On 1 May 2012, the Company issued 207 ordinary shares of 0.01p each at a premium of 0.49p per share for a consideration of £1.04 pursuant to the exercise of warrants.

On 9 May 2012, the Company issued 200 ordinary shares of 0.01p each at a premium of 0.49p per share for a consideration of £1 pursuant to the exercise of warrants.

8.        EARNINGS PER SHARE - CONTINUING OPERATIONS

The basic loss per share is calculated by dividing the loss attributable to equity holders of the Company by the weighted average number of ordinary shares in issue for the period. As the Company has reported a loss for the period the shares are not diluted for the purpose of earnings per share

6 months ended 6 months ended Year ended
30/06/2012   30/06/2011   30/12/2011  
£'000 £'000 £'000
Loss attributable to equity holders of the Company
  • continuing 

298 111 289
  • discontinued 

- 512 489
  • total 

298 623 778
Weighted average number of ordinary shares in issue 415,171,366 314,822,890 358,237,982
Basic loss per share -  continuing operations 0.07p 0.04p 0.08p
                -  discontinued operations - 0.16p 0.14p
  • total 

0.07p 0.20p 0.22p

9        Reconciliation of Movement in Shareholders Funds

Share Capital Share Premium Share Based payment reserve Profit and loss account Total
£'000 £'000 £'000 £'000 £'000
At 1 January 2011 6,611 15,303 - (21,310) 604
Loss for the period - - - (623) (623)
Issue of share options 95 95
Issue of shares net of costs 32 1,488 - - 1,520
Bonus Issue 2,505 (2,505) - - -
Reorganisation (2,505) - - 1,604 (901)
As at 30 June 2011 6,643 14,286 95 (20,329) 695
Loss for the period - - (155) (155)
Issue of shares net of costs - - - - -
Share option credit - - (9) - (9)
Reorganisation - - - (6) (6)
As at 31 December 2011 6,643 14,286 86 (20,490) 525
Loss for the period - - - (298) (298)
Issue of shares net of costs 4 68 - - 72
As at 30 June 2012 6,647 14,354 86 (20,788) 299

10.        EVENTS AFTER THE BALANCE SHEET DATE

On 6 September 2012, the Company issued 66,668 ordinary shares of 0.01p each at a premium of 0.49p per share for a consideration of £333.34 pursuant to the exercise of warrants.

        The Company held an investment in Evergreen Oil Plc which was valued at £177,000 at 31 December 2011. On 15 August an announcement was made stating that their shares on Plus were suspended pending clarification of their financial position and as a consequence the investment in their shares have been fully provided for in these financial statements.

For further information, please contact:

Alexander David Investments PLC                +44 20 7448 9820
Percy Lomax

Cairn Financial Advisers LLP       +44 20 7148 7900
Nominated Adviser
Liam Murray/Avi Robinson

Alexander David Securities Limited     +44 20 7448 9820
Broker
David Scott/Bill Sharp




This announcement is distributed by Thomson Reuters on behalf of Thomson Reuters clients.

The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and other applicable laws; and
(ii) they are solely responsible for the content, accuracy and originality of the
information contained therein.

Source: Alexander David Investments PLC via Thomson Reuters ONE

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