Final Results

AWG Services PLC 09 April 2003 9 April, 2003 AWG SERVICES PLC ('AWG' or 'the Company') Preliminary Results for the year ended 31 October, 2002 Chairman's Statement I am pleased to report your Company's results for the year ended 31 October, 2002. This financial year has seen almost all the assets in AWG Services converted into cash and a substantial part of our time being spent looking for a suitable reverse candidate. The Company's suitability as a reverse vehicle is excellent and this has seen a high number of opportunities presenting themselves. In the year under review the group incurred an operating loss of £244,082 (2001: £822,582) on a turnover of £76,419 (2001: £340,849). The loss on ordinary activities before taxation of £781,115 (2001: £1,103,810) includes a charge for losses incurred on the disposal of the Company's discontinued narrowboat operations of £504,249. In view of this trading result the directors are not recommending the payment of a dividend (2001: Nil). Assets Sales and Discontinued Operations The Company announced on 9 July 2002 that it had disposed of 92 held in Anglo-Welsh Overseas Limited, a wholly owned subsidiary of the Company. Under the terms of this transaction, Anglo-Welsh Overseas Limited was sold for a consideration of £1 and the outstanding inter-company loan of £1.74 million due from Anglo-Welsh Overseas Limited was repaid. Total financial obligations relating to the narrowboats, amounting to £340,000, and a group bank loan, amounting to £60,000, have been discharged. The net cash proceeds available to the Company as a result of this transaction amounted to approximately £1.33 million. As part of the sale of the narrowboats the management agreement for the 92 boats was novated to Anglo-Welsh Overseas Limited. The income under this management agreement which accrued to the Company for the period ended 31 May 2002 amounted to £43,890. The loss resulting from the disposal of Anglo-Welsh Overseas Limited amounted to £404,167. The loss on boats sold by the Company amounted to £74,105 and the write-down of the remaining narrowboat stock to estimated residual values amounted to £25,977. At this time the Company has two remaining narrowboats, of which one is currently being marketed for sale. The closure of the Watertime Club, our timeshare business, is almost complete and I anticipate this being concluded in the near future. The licenses required to transfer all the Company's boatyard leases were received and actioned during the year. We continue to actively market for sale our attractive marina site at Great Haywood which has planning permission for a marina, restaurant and hotel complex. Current Trading Following the disposal of the narrowboats in July 2002 the Company has no current trading activities. At this time the remaining assets in the Company are cash of approximately £1.36 million and two narrowboats and the land site at Great Haywood which, in aggregate, have a net book value of £167,000. The Board does not expect the disposal proceeds from the remaining assets to be less than their net book value. Strategy With almost all assets converted into cash, the focus of your directors has been to identify an attractive reverse candidate that the Board believes will, in time, reward investors with share price appreciation. To date we have investigated a significant number of potential opportunities. This has entailed activity ranging from initial business plan reviews, through in-depth discussions to drafting structures for potential reverse candidates. This is an extremely time consuming process, but vital in our determination to make a beneficial transaction on your behalf. Time spent in this way is the best form of due diligence and ensures that we concentrate on those prospects offering the most potential. Stephen Thomson 9 April, 2003 CONSOLIDATED PROFIT AND LOSS ACCOUNT for the year ended 31 October, 2002 Note 2002 2001 £ £ TURNOVER 76,419 340,849 Cost of sales - normal (84,716) (288,883) - exceptional - (375,000) -------- -------- GROSS (LOSS)/PROFIT (8,297) (323,034) Operating expenses (235,785) (499,548) -------- -------- OPERATING LOSS (244,082) (822,582) Loss on the disposal of discontinued 2 (504,249) (158,187) operations Provision for loss on operations to be discontinued 2 - (49,952) -------- -------- LOSS ON ORDINARY ACTIVITIES BEFORE INTEREST (748,331) (1,030,721) Interest (32,784) (73,089) -------- -------- LOSS ON ORDINARY ACTIVITIES BEFORE TAXATION (781,115) (1,103,810) Taxation 3 42,000 100,615 -------- -------- RETAINED LOSS FOR THE FINANCIAL YEAR (739,115) (1,003,195) ======== ======== BASIC LOSS PER SHARE (IN PENCE) 4 (0.5) (0.7) ======== ======== There were no recognised gains or losses other than the result for the year as shown above. All material trading activities have been discontinued during the year. The only ongoing costs and income relate to the management and administration of the company and the realisation of the remaining trading assets. CONSOLIDATED BALANCE SHEET As at 31 October, 2002 Note 2002 2001 £ £ FIXED ASSETS Tangible assets 5 128,292 2,867,681 -------- -------- CURRENT ASSETS Stocks 97,506 18,000 Debtors 18,632 153,222 Cash at bank and in hand 1,415,484 309,807 -------- -------- 1,531,622 481,029 CREDITORS - amounts falling due within one year (156,933) (736,770) -------- -------- NET CURRENT (LIABILITIES)/ ASSETS 1,374,689 (255,741) -------- -------- TOTAL ASSETS LESS CURRENT 1,502,981 2,661,940 LIABILITIES CREDITORS - amounts falling due after more than one year (25,622) (353,466) PROVISIONS FOR LIABILITIES AND - (42,000) CHARGES -------- -------- 1,477,359 2,216,474 CAPITAL AND RESERVES ======== ======== Called up share capital 1,622,718 1,622,718 Share premium 2,778,007 2,778,007 Capital redemption reserve 164,667 164,667 Profit and loss account (3,720,333) (2,981,218) Capital reserve 632,300 632,300 -------- -------- SHAREHOLDERS' FUNDS 1,477,359 2,216,474 ======== ======== ================== ================== CONSOLIDATED CASH FLOW STATEMENT for the year ended 31 October, 2002 2002 2001 £ £ £ £ NET CASH OUTFLOW FROM (310,279) (904,523) OPERATING ACTIVITIES RETURNS ON INVESTMENTS AND SERVICING OF FINANCE Net Interest paid (32,784) (73,089) TAXATION - (685) CAPITAL EXPENDITURE AND FINANCIAL INVESTMENT Payments to acquire - (19,380) tangible fixed assets Receipts from the sale of 2,128,332 63,126 tangible fixed assets Receipts from the sale of 1 13,326 Investments Net receipts from the sale - 699,524 of operations -------- -------- 2,128,333 756,596 -------- -------- CASH INFLOW/(OUTFLOW) 1,785,270 (221,701) BEFORE FINANCING FINANCING Repayment of loans (679,593) (1,200,008) Net proceeds from issue of - 2,260,703 new shares -------- -------- (679,593) 1,060,695 -------- -------- INCREASE IN CASH 1,105,677 838,994 ======== ======== NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2002 1. ACCOUNTING POLICIES The financial statements have been prepared under the historical cost convention and in accordance with applicable accounting standards. Basis of consolidation The consolidated financial statements incorporate the financial statements of AWG Services plc and all its subsidiary undertakings made up to 31 October, 2002. 2. DISCONTINUED OPERATIONS On 1 November 2001 the company's wholly subsidiary Anglo-Welsh Overseas Limited transferred certain narrowboats to AWG Services plc ('AWG'). The majority of the boats transferred were sold during the year generating a loss of £74,105. Those boats not sold have been transferred to stock where they have been written down by £25,977 to their recoverable value. On 8 July 2002 the company sold its subsidiary in Anglo Welsh Overseas Limited creating a loss on disposal of the subsidiary undertakings of £404,167. A summary of the losses incurred on the disposal of the group's narrowboats operations is shown below: £ Loss on disposal of Anglo-Welsh Overseas Limited 404,167 Loss on disposal of narrowboats sold by AWG 74,105 Write down of narrowboat stock to estimated residual values 25,977 -------- 504,249 ======== The loss arising on disposals of discontinued operations in the year ended 31 October 2001 relates to a net loss of £39,432 on the disposal of the hire business and costs pertaining thereto. A further loss of £88,755 arose on the disposal of the Group's boat building activities. A loss of £30,000 arose in respect of the write off of unpaid consideration from the sale of the agricultural machinery business in the previous year as a consequence of the subsequent insolvency of the purchaser of that business. The provision for loss on operations to be discontinued in the year ended 31 October 2001 relates to the provision for losses to be incurred in the termination of the timeshare activities of Time Afloat Limited. The carrying value of the assets and liabilities of Time Afloat Limited have been adjusted to reflect costs and provisions arising from the discontinued trade. 3. TAXATION 2002 2001 £ £ Taxation credit is based on the loss for the year and is made up as follows: Adjustments in respect of prior years - 385 -------- -------- Current tax charge - 385 Deferred taxation (42,000) (101,000) -------- -------- (42,000) (100,615) ======== ======== 4 LOSS PER SHARE Basic loss per ordinary share of 0.5 pence (2001: 0.7 pence) is calculated using the net basis on the group loss for the year after tax of £739,115 (2001: £1,003,195) and on the weighted average number of shares in issue of 162,271,750 (2001: 136,200,300) 2002 2001 pence pence Basic loss per share (0.5) (0.7) ======== ======== 5 TANGIBLE FIXED ASSETS Freehold Narrow boats Plant & Total Land & £ Equipment £ Buildings £ £ Cost At 1 November, 246,708 4,041,370 2,847 4,290,925 2001 Disposals (120,000) (3,886,379) - (4,006,379) Transferred to - (154,991) - (154,991) stock -------- -------- -------- -------- At 31 October, 126,708 - 2,847 129,555 2002 -------- -------- -------- -------- Depreciation At 1 November, - 1,422,930 314 1,423,244 2001 Charge for the - 59,424 949 60,373 period Disposals - (1,439,979) - (1,439,979) Transferred to - (42,375) - (42,375) stock -------- -------- -------- -------- At 31 October, - - 1,263 1,263 2002 -------- -------- -------- -------- Net book value At 31 October, 126,708 - 1,584 128,292 2002 ======== ======== ======== ======== ================ ================== ============== At 31 October, 246,708 2,618,440 2,533 2,867,681 2001 ======== ======== ======== ======== 6. Dividends The Directors are not proposing the payment of a dividend in respect of the year ended 31 October, 2002. 7. Publication of non-statutory accounts The financial information set out in this preliminary announcement does not constitute statutory accounts as defined in Section 240 of the Companies Act 1985. The consolidated balance sheet as at 31 October, 2002, and the consolidated profit and loss account, consolidated cash flow statement and associated notes for the year have been extracted from the group's financial statements. Those financial statements have not yet been delivered to the Registrar of Companies, nor have the auditors reported on them. The 2001 accounts have been delivered to the Registrar of Companies and the auditors reported on them, their report was unqualified and did not contain a statement under Section 237(2) or (3) of the Companies Act 1985. 8. Copies of accounts will be sent to shareholders shortly and will also be available at the Company's registered office. Further enquiries AWG Services plc Stephen Thomson Tel: 01603 877 682 John East & Partners Limited John East / Simon Clements Tel: 020 7628 2200 This information is provided by RNS The company news service from the London Stock Exchange

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