Final Results

International Brand Licensing PLC 30 June 2003 Immediate Release 30 June 2003 International Brand Licensing Plc ('IBL' or the 'Company') Final Audited Results for the Year Ended 31 December 2002 Chairman's Statement As the activities and assets of International Brand Licensing Plc were only demerged from the Hay & Robertson group on 5 June 2002, we are reporting the full year ended 31 December 2002, along with comparisons of trading for the year ended 31 December 2001, during which time the operation of the business was carried out as a subsidiary of Hay & Robertson plc. During the year ended 31 December 2002 turnover rose from £1,096,000 to £1,616,000 and profit before tax and exceptional items rose from £303,000 to £792,000. During the latter part of 2002 and the first half of 2003 the company has suffered a torrid time. The main operating subsidiary of Hay & Robertson, Big Hit Limited, which continued to operate as IBL's main UK Admiral licensee after the demerger, was placed into administration on 1 May 2003. This has resulted in an exceptional bad debt charge of £273,000 for the year ending 31 December 2002, which with exceptional costs of £184,000 incurred in connection with the demerger, reduced the profit from £792,000 to £335,000 before tax. These problems in particular have had a direct impact on cash flow and have put a considerable strain on the group's financial resources. The license agreement between IBL and Big Hit Limited was automatically terminated, consequently halting the stream of royalties forecast from Admiral sales made in the UK for 2003 and leaving the company with no alternative but to take over the operation of the Admiral England and West Indies cricket team sponsorships. On a positive note the revenues generated from the sales of England and West Indies replica cricket kits and branded apparel will contribute profits to the company during 2003 and beyond. Outside the UK, 2002 proved to be a strong year for Admiral as we extended our international partner network with the appointment of new licensees in a number of key markets. Early in the year we appointed Nissho Iwai as the new Admiral master licensee in Japan and they were able to successfully re-launch the brand in the second half. We also entered into agreements with new licensee partners for Admiral in Benelux, Germany, Austria, Italy, Australia and the Caribbean, all of which have begun to generate royalties in 2003. In April 2003 the company entered into a new long-term license agreement with OSC, the company's current European Mountain Equipment technical equipment licensee, guaranteeing the company a minimum royalty of £4.3 million for the period from 1 January 2004 to 31 December 2013. The company has identified and is in discussions with a new replacement Admiral licensee for the UK and will continue to develop and grow its licensee network for both the Admiral and Mountain Equipment brands as well as expand its portfolio of brand representations. Gillian Shepherd has decided to stand down from her position as Financial Director and until a suitable replacement is recruited, Solutions Corporate Limited, which has been retained to advise the group, will provide the services associated with this position. The board wish Gillian all the best for the future. The year ahead will prove to be extremely challenging as your board strives to put the company on a firmer financial footing and replace the lost forecast revenues through concluding agreements with new licensee partners. Lance Yates Chairman 30 June 2003 Consolidated Profit and Loss Account 2002 2001 £000 £000 TURNOVER 1,616 1,096 Administrative expenses (730) (626) Exceptional administative expenses (457) - ------- ------ OPERATING PROFIT 429 470 Interest receiveble 1 - Interest payable (95) (167) ------- ------ PROFIT ON ORDINARY ACTIVITIES BEFORE TAX ---------------------------------------- ------- ------ -before exceptional items 792 303 -exceptional items (457) - ---------------------------------------- ------- ------ 335 303 Tax on profit on ordinary activities (192) (9) ------- ------ PROFIT ON ORDINARY ACTIVITIES AFTER TAXATION 143 294 Ordinary dividend on equity shares - (252) ------- ------ RETAINED PROFIT FOR THE YEAR 143 42 ======= ====== EARNINGS PER ORDINARY SHARE Before exceptional items -Basic 2.4p 0.2p -Diluted 2.4p 0.2p After exceptional items -Basic 0.6p 0.2p -Diluted 0.6p 0.2p CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES 2002 2001 £000 £000 Profit for the year 143 42 Exchange differences 179 (3) ------- ------- Total Recognised gains and losses relating to the year 322 39 ======= ======= Consolidated Balance Sheet 2002 2001 £000 £000 FIXED ASSETS Intangible assets 5,775 5,223 Tangible assets 20 20 ------ ------- 5,795 5,243 CURRENT ASSETS Debtors 434 190 Cash at bank and in hand 203 15 ------ ------- 637 205 Creditors: amounts falling due within one year (905) (3,393) ------ ------- NET CURRENT LIABILITIES (268) (3,188) ------ ------- TOTAL ASSETS LESS CURRENT LIABILITES 5,527 2,055 Creditors:amounts falling due after more than one year (2,625) (1,841) ------ ------- NET ASSETS 2,902 214 ======= ======= CAPITAL AND RESERVES Share capital 276 213 Share premium 1,887 - Merger reserve 244 (172) Profit and loss account 495 173 ------- ------- SHAREHOLDERS' FUNDS 2,902 214 ======= ======= The financial statements were approved by the board on 30 June 2003 Gillian Shepherd Director Company Balance Sheet 2002 £000 FIXED ASSETS Investments 213 CURRENT ASSETS Debtors 4,754 Cash at bank and in hand 94 -------- 4,848 Creditors:amounts falling due within one year (438) -------- NET CURRENT ASSETS 4,410 -------- TOTAL ASSETS LESS CURRENT LIABILITIES 4,623 -------- Creditors:amounts falling due after more than one year (2,625) ======== NET ASSETS 1,998 ======== CAPITAL AND RESERVES Share capital 276 Share premium 1,887 Profit and Loss account (165) -------- SHAREHOLDERS FUNDS 1,998 ======== Consolidated Statement of Cash Flows 2002 2001 £'000 £'000 NET CASH INFLOW FROM OPERATING ACTIVITIES 132 187 TAXATION Foreign taxes paid (124) (45) CAPITAL EXPENDITURE AND FINANCIAL INVESTMENT (210) Purchase of intangible fixed assets (99) Purchase of tangible fixed assets (5) (29) -------- -------- -------- -------- NET CASH OUTFLOW FROM CAPITAL EXPENDITURE AND FINANCIAL INVESTMENT (104) (239) -------- -------- NET CASH OUTFLOW BEFORE FINANCING (100) (97) FINANCING Repayment of intercompany balances to Hay & Robertson plc on demerger (4,600) - New bank borrowings 2,938 - Issue of ordinary shares 2,500 - Less expenses of issue (550) - -------- -------- NET CASH INFLOW FROM FINANCING 288 - -------- -------- INCREASE/(DECREASE) IN CASH IN THE YEAR 188 (97) ======== ======== Notes to the Statement of Cash Flows (a) Reconciliation of operating profit to net cash inflow from operating activities 2002 2001 £000 £000 Operating profit 429 470 Depreciation 7 7 Increase in debtors (120) (51) Decrease in creditors (184) (239) -------- -------- 132 187 ======== ======== (b)Reconciliation of net cash inflow to movement in net debt 2002 2001 £000 £000 Increase/(decrease) in cash in the year 188 (97) Increase in bank borrowings (2,938) - ------- -------- (2,750) (97) Non-cash movements 1,930 864 Exchange differences (89) (3) Net debt at beginning of year (1,826) (2,590) ------- -------- (2,735) (1,826) ======= ======== (c) Analysis of net debt At 1 January Cash flow Non cash Exchange At 31 December 2002 Movements Differences 2002 £000 £000 £000 £000 £000 Cash at 15 188 - - 203 bank Hay & (1,841) - 1,930 (89) - Robertson loan Bank - (2,938) - - (2,938) borrowings --------- ------- -------- -------- ---------- (1,826) (2,750) 1,930 (89) (2735) ========= ======= ======== ======== ========== Non cash movements reflect the transfer of the Hay & Robertson loan to creditors due in less than one year. Under the terms of the demerger agreement the Hay & Robertson loan and other intercompany lending to the group became repayable in full on completion. The attached announcement does not constitute statutory accounts within the meaning of section 240 of the Companies Act 1985. The statutory accounts for the year ended 31 December 2002 upon which an unqualified audit opinion has been given other than in respect of an 'emphasis of matter' paragraph, and which did not contain a statement under section 235, 237(2) or 237(3) of the Companies Act 1985 will be delivered to the registrar of companies shortly. The Annual General Meeting will be held on Wednesday 23 July at 10 AM at Orchard Solicitors, 6 Snow Hill, London EC1A 2AY. Copies of the Report and Accounts are available from Orchard Solicitors, 6 Snow Hill, London EC1A 2AY. This information is provided by RNS The company news service from the London Stock Exchange

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