Preliminary Results
CSS Stellar PLC
15 March 2007
For Immediate Release 15 March 2007
CSS Stellar plc
('CSS' or 'the Group')
Preliminary Results
for the year ended 31 December 2006
CSS Stellar plc, the entertainment and sports management and marketing group,
today announces its preliminary results for the year ended 31 December 2006.
Highlights:
: Results ahead of market expectations
: Turnover on continuing operations up by 13.6% to £31.6m (2005:
£27.9m)
: Operating profit on continuing operations before amortisation of
goodwill increased by 89% to £1.5m (2005: £0.8m)
: Group EBITDA on continuing operations of £1.9m (2005: £1.2m)
: Improved profit in the US Marketing division of £356,000 (2005: loss
of £83,000)
: Central overheads reduced further by 17%
Commenting on the results Peter Owen, Chairman, said:
'We are pleased with the improved performance of the group in 2006. The increase
in turnover and profit is due to better results in our Events division, recovery
in our North American marketing division, and a continuing reduction in central
overheads. Trading has begun satisfactorily in 2007.'
For further information please contact:
CSS Stellar
Sean Kelly, Chief Executive Tel: 020 7078 1400
Buchanan Communications
Bobby Morse/Rebecca Skye Dietrich Tel: 020 7466 5000
CHAIRMAN'S STATEMENT - DRAFT 13 March 2007
Overview and Strategy
The Group's results for 2006 showed continued improvement with significant
achievement throughout the Group, and increased profits in our core businesses.
Strategically the Group is now reviewing how to optimise shareholder value
through the development or realisation of value from each of its existing
businesses.
Financial Results
The 2006 results were comfortably ahead of market expectations with an operating
profit on continuing operations before amortisation and impairment of goodwill
of £1.5 million (2005: £0.8 million). Turnover of £31.6 million was 13.6% ahead
of the prior year (2005: £27.9 million), after excluding turnover on operations
discontinued in 2005.
The reasons for the 89% increase in adjusted operating profit are contained in a
more detailed operational and financial review. In summary they are:
• Improvement in the USA, where GEM Minneapolis has performed ahead of
expectations;
• Improvement in the profitability of the Sports Talent business,
particularly in the USA;
• Icon's events business having the best year in its history; and
• Continued reduction in central overhead costs.
The Group also repaid bank debt in the year of £0.4 million (2005: £2.1
million), with a year end liability of £1.4 million (2005: £1.8 million).
Current Trading
The Group's first two months of trading in 2007 are in line with the Board's
expectations.
Board Changes
As announced last year, John Webber retired from the Board in March 2006, and
was replaced by Peter Owen as non-executive chairman. Kevin Rose resigned as
Group Finance Director in March 2006 and Sean Kelly, CEO and previously finance
director, has overseen the finances of the Group. In October 2006, Duncan Soukup
joined the Board as a non-executive director.
I would like to thank all our employees for their considerable efforts
throughout 2006, a year in which the results are much improved.
Peter Owen
Chairman
15 March 2007
OPERATING AND FINANCIAL REVIEW
Group Review of 2006
The 2006 results are a significant improvement on 2005, as the Group has
benefited from the restructuring work across the Group in 2004 and 2005.
The Group made an operating profit of £118,000 in 2006, compared with an
operating loss of £16.2 million in 2005. The loss in 2005 was significantly
impacted by an exceptional impairment charge of £14.8 million to reflect a write
down in the carrying value of goodwill. If this exceptional charge is excluded,
the 2006 operating profit represents a significant improvement on an operating
loss of £1.4 million.
Turnover on continuing operations for the year was £31.6 million, an increase of
13.6% on 2005 (£27.9 million). The increase was due to growth in Icon (Events)
and Talent Management.
Operating profit on continuing operations before goodwill amortisation increased
to £1.5 million (2005: £0.8 million), an increase of 89%, and the Group's EBITDA
on continuing operations was £1.9 million (2005: £1.2 million). This increase is
due to the strong performance in our Events division, in addition to a recovery
in our North American marketing division, and a continuing reduction in central
overheads.
In 2006 the Group faced several issues that have now been dealt with:
• Unprofitable businesses now stabilised - in particular GEM in the USA.
• Surplus property costs now removed.
• Profitability on operating businesses now at 14.7% EBITDA to gross
profit, which is acceptable in the industry.
• Central costs stabilised at £0.7 million per annum or 3.6% of gross
profit.
The improvement in operating profit is analysed as follows:
2006 2005 Increase/Decrease
£'000s £'000s £'000s
Talent Management 1,049 1,128 (79)
Marketing - GEM 356 (83) 439
Events - Icon 810 623 187
Central costs (736) (887) 151
____ ____ ____
Operating Profit 1,479 781 698
____ ____ ____
The primary reasons for these changes are improvements in trading, greater
operational efficiencies and the reduction in non-productive overhead. The
decline in Talent is as a result of higher remuneration costs for senior agents
and the continuing investment in PFD New York, which has reduced profitability.
Gross profit is the other key guide to our businesses performance, and the most
significant cost in these people businesses is salary and benefits.
There was improvement in the following key ratios:
2006 2005
Gross profit per employee £87,058 £76,048
Salary/ Gross profit 69% 74%
EBITDA per employee £8,220 £4,890
The individual units are discussed in more detail below.
Talent Management
Our Talent Management division reported turnover of £14.1 million for the year,
an increase of 16.6% on 2005. Operating profit of £1.0 million was approximately
in line with the prior year (£1.1 million). The gross profit shows a smaller
increase of 5.1% in 2006 at £12.4m (2005: £11.8 million).
Entertainment
The Group's Entertainment talent division consists almost entirely of The Peters
Fraser & Dunlop Group Limited ('PFD'), which is one of the oldest and largest
talent agencies in Europe.
PFD's clients continued to achieve notable successes during the year. In
particular:
Within Film, Television and Theatre:
•Kate Winslet was nominated for Best Actress both for an Oscar and a
Golden Globe for 'Little Children';
•Toni Collette was nominated for a Golden Globe for Best Actress (Musical
or Comedy) for 'Little Miss Sunshine';
•Dan Mazer was nominated for an Oscar for Best Adapted Screenplay for
'Borat: Cultural Learnings of America For Make Benefit Glorious Nation of
Kazakhstan';
•Jenna Russell won Best Actress in a Musical for 'Sunday in the Park with
George' at the Olivier Awards;
•Alan Bennett's 'The History Boys' won the award for Best Play at the 2006
Tony Awards, in addition to five other awards, making it the most honoured
play on Broadway since 1949;
•Anna Maxwell Martin won Best Actress at the 2006 BAFTA Awards for her
role in Bleak House; and
•James McEvoy was nominated Best Actor in a Supporting Role for 'The Last
King of Scotland' at the 2007 BAFTA's.
Within the Literary Division:
•Neil Griffiths' literary thriller 'Saving Caravaggio' is shortlisted for
Best Novel in the Costa Book Awards (formerly the Whitbread prize);
•Ally Kennen ('Beast') and John Boyne ('The Boy in the Striped Pyjamas')
have both been nominated for the 2006 Carnegie Medal;
•Alan Bennett received the PEN/J. F. Ackerley prize for literary
autobiography; and
•Alan also won 'Author of the Year' at the 2006 British Book Awards.
Other PFD clients who achieved notable successes during the year included
Richard Curtis, who won Outstanding Made for TV movie and Outstanding Writing at
the 2006 Primetime Emmy Awards for 'Girl in the Cafe', Keira Knightley, who
starred in the Hollywood blockbuster 'Pirates of the Caribbean II', and Kevin
MacDonald, who directed 'Last King of Scotland', which won a BAFTA for
Outstanding British Film in 2007.
Sports
The Sports division's clients achieved notable successes during the year. Within
Motorsports, following his victory in the 2005 IRL Championship, Dan Wheldon was
runner up in the 2006 Championship, having tied on points with the eventual
champion. Sebastien Loeb was crowned World Rally Champion for the third
consecutive year, and Allan McNish won the 2006 American Le Mans Series
Championship for the second time. In 2006 we also signed the up and coming
NASCAR driver, A J Allmendinger, and continued our management of Milka Duno
through the Citgo motorsports programme. Juan Pablo Montoya left Formula One to
race for NASCAR. The growth in the client base in the USA over the last four
years has meant that in 2007 the expectation is that 55% of income will be
generated by US-based clients.
As anticipated in the 2005 results review, the Golf division is now operating
profitably, and our clients achieved success on the European PGA Tour. Gonzalo
Fernandez-Castano won the Asian Open in April, and Francesco Molinari became the
first home winner of the Italian Open since 1980. Sandy Lyle released his
autobiography, 'To the Fairway Born' in 2006 to critical acclaim.
In Football, our relationship with the England football team ended after the
2006 World Cup in Germany.
Marketing
The Marketing division recorded an operating profit of £356,000 (2005: loss of
£83,000).The return to profitability has arisen as a result of the closure of
several offices and the consequent reduction in overheads.
Turnover of £6.0 million was a reduction of 6.2% on 2005. The fall in turnover
has arisen following the restructuring undertaken in 2005, when a number of
underperforming offices were closed down. The benefits of this restructuring
have been evident in the improved results, and in a profit margin in 2006 which
improved to 6.0% (2005: loss of 1.3%).
The Marketing division now has two North American operations, in Minneapolis and
New York. There was a strong performance by our Minneapolis operation, which has
been streamlined following its establishment as an independent unit operating
under local management throughout 2006.
GEM Minneapolis has provided brand design and packaging, marketing and
photography studio and catalogue services to Best Buy, the leading US
electronics retailer, and 3M, and catalogue marketing services to Fingerhut
Direct Marketing.
GEM's New York office is a promotional marketing specialist, which has a niche
in the cable TV industry and in the use of the Olympic Games by top sponsors
such as NBC and GE. In addition, GEM carried out an online and on pack promotion
for GE Lighting, and the delivery of strategic marketing, production and
activation for a retail driven 'instant win' promotion for Fujifilm.
Events
Our Events division has had another excellent year in 2006. Turnover of £11.6
million represents an increase of 23% (2005: £9.4 million) and has resulted in
an operating profit of £0.8 million (2005: £0.6 million), an increase of 30%.
The 2006 Gross profit was £3.9 million (2005: £3.3 million).
The increase during the year is due in part to the 2006 FIFA World Cup, and the
late call up to work on the 2006 Ryder Cup in Ireland.
Icon played a pivotal role in delivering the look of the 12 host stadia at the
World Cup in Germany, working closely with FIFA to design and install all
internal and external stadium dressing. Icon were also appointed to assist with
major elements of the branding programme for the Ryder Cup at the K Club in
Ireland, and were responsible for the production, installation and operation of
the rotating advertising units at the event, and also designed, produced and
installed all directional signage.
Icon also worked with Chelsea FC to provide branding for their end of season
parade of the Premiership trophy, and also designed and installed all static
tier dressing at Arsenal FC at their new Emirates stadium.
The company provided all branding to the BMW Golf Championship at Wentworth, as
well as continuing relationships with clients such as UEFA and TEAM for The
Champions League, World Snooker and the ECB. Following on from Icon's opening of
offices in Qatar, Icon has designed, produced and installed branding solutions
for the International Triathlon Union World Cup and Qatar Masters Golf
championship, and has recently coordinated branding and signage at the Abu Dhabi
F1 festival.
Central Costs
Central costs for 2006 were £0.7 million, a reduction of 17% (2005: £0.9
million). Costs continue to be monitored closely, with savings continuing to be
made. During the year, the Group negotiated the surrender of surplus property,
which will yield savings of £325,000 across the Group in future years, and staff
cost reductions have been achieved both in the UK and the US.
Interest Payable
The net interest payable by the Group in 2006 was £144,000 (2005: £348,000). The
reasons for the decrease are the continued reduction in bank debt to £1.4
million at 31 December 2006 (2005: £1.8 million), better management of the
overdraft facility and higher levels of interest received (2006: £141,000; 2005:
£99,000) on cash deposits.
Goodwill
Following the impairment provision of £14.8 million made in 2005, the Board have
again reviewed the goodwill held in the Balance Sheet and continue to believe
that the carrying value of the Group's goodwill of £18.0 million is appropriate.
The amortisation charge in the year is £1.4 million (2005: £1.9 million).
Goodwill has been amortised over periods of 5 to 20 years.
Taxation
The Group's tax charge was £0.5 million (2005: £0.1 million), which relates
entirely to the UK operations, due to losses carried in our overseas
subsidiaries. The increase in the charge reflects the Group's return to
profitability.
Earnings per Share
Unadjusted earnings per share on a basic and fully diluted basis shows a loss of
2.18p per share (2005: loss of 60.25p). Once the figure is adjusted for
amortisation of goodwill, the fully diluted earnings per share are 2.48p (2005:
1p). The basic adjusted earnings per share in 2006 are 2.52p (2005: 1p).
Foreign Exchange
The Group's earnings are exposed to the movement in the US Dollar. The average
US Dollar rate in 2006 was $1.84 to the Pound (2005: $1.82), although the rate
at 31 December 2006 weakened to $1.96 to the Pound (2005: $1.72).
Bank Debt
The Group's gross bank debt at 31 December 2006 was £3.6 million (2005: £3.4
million) of which £1.4 million is bank debt (2005: £1.8 million), and the
remainder an overdraft to finance working capital. During the year £0.4 million
of borrowings were repaid, financed through cash from operations.
Cash Flow
The cashflow statement shows an increase in cash of £124,000, a significant
improvement on 2005, which showed a decrease in cash of £477,000. Net cash
inflow from operating activities has also improved to £1.0 million (2005:
£284,000).
Transition to International Financial Reporting Standards
The London Stock Exchange has now confirmed its intention to mandate
International Accounting Standards for AIM registered companies from 2007
onwards. The Group will apply these policies for the first time in the Group's
Annual Report for the year ending 31 December 2007. Consequently, the Group's
Interim Results for the six month period 30 June 2007 will be presented under
IFRS together with restated information for the six months ended 30 June 2006
and the year ended 31 December 2006.
The Group has identified that the principal differences between IFRS and the
Group's UK GAAP accounting policies relate to Goodwill, Deferred Taxation, and
Financial Instruments. International Accounting Standards require that goodwill
is not amortised, but is subject to an annual impairment review and no longer
amortised. The scope of IAS 12 'Income Taxes' is wider than that required by
corresponding UK GAAP, and requires deferred tax to be provided on all temporary
differences rather than only timing differences under UK GAAP. IAS 32 and IAS
39, which cover Financial Instruments, will require the Group to account for all
financial instruments at either fair value or amortised cost.
Sean Kelly
Chief Executive Officer
15 March 2007
CSS STELLAR PLC
CONSOLIDATED PROFIT AND LOSS ACCOUNT
Year ended 31 December 2006
Unaudited Audited
2006 2005
Notes £000 £000
Turnover
- Continuing operations 31,644 27,854
- Discontinued operations - 26,558
---------- ----------
Group Turnover 1 31,644 54,412
Cost of sales (11,011) (29,251)
---------- ----------
Gross profit 20,633 25,161
---------- ----------
Impairment of goodwill and investments 2 - (14,769)
Amortisation of goodwill (1,361) (1,881)
Other administrative expenses (19,154) (24,695)
---------- ----------
Administrative expenses - total (20,515) (41,345)
---------- ----------
Operating profit/(loss)
---------- ----------
- Continuing operations 118 (2,476)
- Discontinued operations - (13,708)
---------- ----------
1 118 (16,184)
Exceptional non-operating items
2 - (843)
---------- ----------
(17,027)
Interest receivable 141 99
Interest payable (285) (447)
---------- ----------
Loss on ordinary activities before taxation 1 (26) (17,375)
Tax on loss on ordinary activities 3 (469) (51)
---------- ----------
Loss on ordinary activities after taxation (495) (17,426)
Minority interests (137) -
---------- ----------
Transferred from reserves (632) (17,426)
========== ==========
Loss per Ordinary share (pence) 4 p. p.
Basic (2.18) (60.25)
Diluted (2.18) (60.25)
---------- ----------
CONSOLIDATED STATEMENT OF TOTAL
RECOGNISED GAINS AND LOSSES
Loss for the financial year (632) (17,426)
Translation adjustment on opening reserves 80 20
---------- ----------
Total losses recognised since last annual report (552) (17,406)
========== ==========
CSS STELLAR PLC
CONSOLIDATED BALANCE SHEET
As at 31 December 2006
Unaudited Audited
2006 2005
Notes £000 £000 £000 £000
FIXED ASSETS
Intangible assets 5 18,036 19,397
Tangible assets 6 1,899 2,043
Other investments 7 41 41
------ --------
19,976 21,481
CURRENT ASSETS
Stocks and work in progress 187 280
Debtors 6,864 5,102
Cash at bank and in hand 1,649 954
-------- --------
8,700 6,336
CREDITORS: AMOUNTS FALLING
DUE WITHIN ONE YEAR (8,202) (6,751)
-------- --------
Net current assets/ 498 (415)
(liabilities) ------ --------
Total assets less current
liabilities 20,474 21,066
CREDITORS: AMOUNTS FALLING
DUE AFTER MORE THAN ONE YEAR (894) (1,275)
Minority interests (442) (120)
------ --------
19,138 19,671
====== ========
CAPITAL AND RESERVES
Called up share capital 14,487 14,487
Share premium 28,158 28,158
Revaluation reserve 620 637
Profit and loss account (24,127) (23,611)
------ --------
Equity shareholders' funds 8 19,138 19,671
====== ========
CSS STELLAR PLC
CONSOLIDATED CASH FLOW STATEMENT
Year ended 31 December 2006
Unaudited Audited
2006 2005
Note £000 £000 £000 £000
Cash inflow from operating
activities 9 1,044 284
Returns on investments and servicing
of finance
Interest paid (276) (447)
Interest received 141 99
Interest element of finance lease
payments (9) -
------- -------
Net cash outflow from returns on (144) (348)
investments and servicing of
finance
Taxation (45) (20)
Capital expenditure and financial
investment
Purchase of tangible fixed assets (334) (350)
Sale of tangible fixed assets 9 15
------- -------
Net cash outflow from capital
expenditure and financial
investment (325) (335)
Acquisitions and disposals
Purchase of investments - (41)
Disposal of subsidiaries - 2,546
Net cash disposed of with
subsidiaries - (540)
Net cash inflow from acquisitions
and disposals - 1,965
------ ------
------ ------
Net cash inflow before financing 530 1,546
Financing
Repayment of borrowings 11 (362) (2,080)
New finance leases 11 - 57
Capital element of finance lease
rentals 11 (44) -
Net cash outflow from financing (406) (2,023)
------ ------
Increase/(decrease) in cash 11 124 (477)
====== ======
CSS STELLAR PLC
NOTES TO THE FINANCIAL INFORMATION
Year Ended 31 December 2006
1. Analysis of Trading and Net Assets
Class of Business
Profit/(Loss)
Before
Divisions Turnover Taxation Net Assets
2006 2005 2006 2005 2006 2005
£000 £000 £000 £000 £000 £000
Continuing
operations
Talent
Management 14,089 12,088 1,049 1,128 (1,205) (1,959)
Marketing 5,959 6,354 356 (83) (2,076) (2,154)
Events 11,596 9,412 810 623 1,918 1,858
Central
costs - - (736) (887) 20,501 21,926
(1) ======== ========= ======== ======== ========= =========
31,644 27,854 1,479 781 19,138 19,671
======== ========= ========= =========
Discontinued
operations
Talent - - - - - -
Management
Marketing - 26,558 - (315) - -
Events - - - - - -
======== ========= ======== ======== ========= =========
- 26,558 - (315) - -
======== ========= ========= =========
Impairment
of - (14,769)
goodwill
Goodwill
amortisation (1,361) (1,881)
--------
-------- --------
Operating
profit/(loss) 118 (16,184)
Net interest (144) (348)
Exceptional
item - (843)
-------- --------
Group loss
before
taxation (26) (17,375)
======== ========
Geographical Market
Profit/(loss) before
Turnover Taxation Net Assets
2006 2005 2006 2005 2006 2005
£000 £000 £000 £000 £000 £000
Continuing
operations
Europe 23,710 20,767 1,870 1,619 713 (102)
North 7,934 7,087 345 49 (2,076) (2,153)
America
Central
costs - - (736) (887) 20,501 21,926
(1) -------- ------ ------ ------ ------ ------
31,644 27,854 1,479 781 19,138 19,671
======== ====== ====== ====== ====== ======
Discontinued
operations
Europe - 3,284 - 102 - -
North - 23,274 - (417) - -
America -------- ------ ------ ------ ------ ------
- 26,558 - (315) - -
======== ====== ====== ====== ====== ======
(1) Central costs have been separately analysed to enable a direct comparison of
the operating performance of each division.
The origin and destination of turnover, profit before taxation and net assets
are not materially different.
Cost of sales, amounts written off goodwill and administrative expenses are
analysed between continuing and discontinued operations below:
Continuing Discontinued Continuing Discontinued
Operations Operations Total Operations Operations Total
2006 2006 2006 2005 2005 2005
£000 £000 £000 £000 £000 £000
Cost of sales 11,011 - 11,011 8,083 21,168 29,251
Impairment of
goodwill - - - 1,776 12,993 14,769
Amortisation
of
goodwill 1,361 - 1,361 1,481 400 1,881
Other
administration
expenses 19,154 - 19,154 18,990 5,705 24,695
======== ========= ====== ======== ========= =====
2. Exceptional Items
Impairment of goodwill and investments 2006 2005
£000 £000
Impairment of goodwill (note 5) - 13,713
Impairment of investments - 1,056
---------- ----------
- 14,769
========== ==========
Exceptional non-operating items 2006 2005
£000 £000
Cost of restructuring - 649
Loss on disposal of subsidiary undertakings - 194
---------- ----------
- 843
========== ==========
3. Tax on Loss on Ordinary Activities
Analysis of charge in year
2006 2005
Current tax £000 £000
United Kingdom corporation tax 493 243
Overseas taxation - 5
---------- ----------
493 248
---------- ----------
Deferred Tax
United Kingdom
- current year 9 (39)
- prior year (33) (158)
---------- ----------
(24) (197)
---------- ----------
Total tax charge on loss on ordinary activities 469 51
========== ==========
The tax charge assessed for the period is higher than the standard rate of
corporation tax in the UK (30%). The differences are explained below:
Tax charge reconciliation
Loss on ordinary activities before taxation (26) (17,375)
========== ==========
Loss on ordinary activities multiplied by the standard
rate of corporation tax (30%) (8) (5,213)
Goodwill amortisation 408 564
Capital allowances in excess of depreciation (1) 122
Expenses not deductible for tax purposes 153 14
Losses in overseas subsidiaries - 677
Utilised losses (69) (4)
Impairment of goodwill and loss on disposal of - 4,078
subsidiaries
Deferred tax unprovided - 10
Other timing differences 10 -
---------- ----------
Tax charge on loss on ordinary activities 493 248
========== ==========
4. (Loss)/Earnings Per Share
Weighted Basic Adjusted
average per share per share
Earnings no. of shares amount amount
2006 £000 Shares Pence Pence
Attributable to ordinary
shareholders:
Loss (632)
Amortisation of goodwill 1,361
-------
Adjusted earnings 729
-------
(Loss) / earnings per
share 28,976,581 (2.18) 2.52
======== ========
Dilutive effect of securities
Options, warrants and
shares to be issued 487,619
---------
---------
(Loss) / earnings per
share 29,464,200 (2.18) 2.48
========= ======== ========
2005
Attributable to ordinary shareholders:
Loss (17,426)
Amortisation of goodwill 1,881
Impairment of goodwill 14,769
Loss on disposal of
subsidiaries 843
Operating loss on
discontinued activities 315
Less: tax at 30% (94)
-------
Adjusted earnings 288
-------
(Loss) / earnings per
share 28,922,957 (60.25) 1.00
======== ========
Dilutive effect of securities
Options, warrants and shares to be -
issued ---------
(Loss) / earnings per
share 28,922,957 (60.25) 1.00
========= ======== ========
5. Intangible Assets
Goodwill
£000
Cost:
At 1 January 2006 30,195
Additions -
Disposals -
--------
At 31 December 2006 30,195
--------
Accumulated amortisation and impairment:
At 1 January 2006 10,798
Amortisation charge for the year 1,361
Impairment losses (note 2) -
Disposals -
--------
At 31 December 2006 12,159
--------
Net book value at 31 December 2006 18,036
========
Net book value at 31 December 2005 19,397
========
6. Tangible Fixed Assets
Furniture
Freehold Motor Event and
property vehicles equipment equipment Total
£000 £000 £000 £000 £000
The Group
Cost or valuation:
1 January 2006 985 350 521 3,975 5,831
Translation - - - (9) (9)
Additions - 95 56 183 334
Disposals - (76) - (18) (94)
-------- ------- -------- --------- -------
At 31 December 2006 985 369 577 4,131 6,062
-------- ------- -------- --------- -------
Accumulated depreciation:
1 January 2006 64 218 396 3,110 3,788
Charge for the year 32 74 92 271 469
Disposals - (76) - (18) (94)
-------- ------- -------- --------- -------
At 31 December 2006 96 216 488 3,363 4,163
-------- ------- -------- --------- -------
Net book value:
At 31 December 2006 889 153 89 768 1,899
======== ======= ======== ========= =======
At 31 December 2005 921 132 125 865 2,043
======== ======= ======== ========= =======
7. Other Investments
£000
Cost:
At 1 January 2006 1,078
Additions -
Disposals -
--------
At 31 December 2006 1,078
--------
Provisions for impairment:
At 1 January 2006 1,037
Amounts written off during the year -
Disposals -
--------
At 31 December 2006 1,037
--------
Net book value at 31 December 2006 41
========
Net book value at 31 December 2005 41
========
8. Reconciliation of Movements in Shareholders' Funds
2006 2005
£000 £000
Loss for the financial year (632) (17,426)
----------- ----------
Other recognised gains and losses relating to the year 80 20
Share based payment charge 19 -
New shares issued (including share premium) - 168
Release of provision for shares to be issued - (489)
----------- ----------
Net decrease in equity shareholders' funds (533) (17,727)
Opening equity shareholders' funds 19,671 37,398
----------- ----------
Closing equity shareholders' funds 19,138 19,671
=========== ==========
9. Reconciliation of Operating Loss to Net Cash Inflow from Operating
Activities
Operating profit/(loss) 118 (16,184)
Depreciation charge 469 610
Amortisation of intangible assets 1,361 1,881
Impairment of goodwill - 14,769
Decrease/(increase) in stocks 93 (109)
(Increase)/decrease in debtors (1,856) 106
Increase/(decrease) in creditors 859 (789)
---------- ---------
Cash inflow from operating activities 1,044 284
========== =========
10. Reconciliation of net cash flow to movement in net debt
Increase/(decrease) in cash in period 124 (477)
Cash outflow from decrease in net debt and lease 406 2,080
financing
New finance leases - (57)
Net debt eliminated on disposal - 170
---------- ----------
Change in net debt 530 1,716
Net debt brought forward (2,463) (4,179)
---------- ----------
Net debt carried forward (1,933) (2,463)
========== ==========
11. Analysis of net debt
At 1 cc At 31
January December
2006 Cashflow 2006
£000 £000 £000
Cash at bank 954 695 1,649
Overdrafts (1,538) (571) (2,109)
--------- -------- --------
(584) 124 (460)
Bank debt due after 1 year (1,223) 362 (861)
Bank debt due within 1 year (533) - (533)
Finance leases (123) 44 (79)
--------- -------- --------
Total (2,463) 530 (1,933)
========= ======== ========
12. Principal Accounting Policies
The principal accounting policies of the Group are set out in the Group's 2005
Annual Report and Financial Statements. These policies have remained unchanged,
with the exception of the adoption of FRS20, Share Based Payments.
13. Financial Information
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 summarised Balance Sheet at 31 December 2006 and the summarised Profit
and Loss Account, the summarised Cash Flow Statement and associated notes for
the year then ended have been extracted from the Group's unaudited Financial
Statements. Those Financial Statements have not yet been delivered to the
Registrar, nor have the auditors reported on them.
The financial information relating to the period ended 31 December 2005 is
extracted from the statutory accounts, which incorporated an unqualified audit
report and which has been filed with the Register of Companies.
This information is provided by RNS
The company news service from the London Stock Exchange
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