Interim Results

Rotala PLC 10 January 2006 10th January 2006 Rotala plc ('Rotala' or 'the Company') Interim Results for the period from date of incorporation to 30th September 2005 Chairman's Statement During the period under review, the main activity of the Company was the identification of its first acquisition target, the Flights Group, and the acquisition of these companies on August 30th 2005. Previous announcements by the Company on September 26th and November 25th 2005 described the background to potential claims by Central Parking System of UK Limited ('CPS') in respect of the Flights Group of companies acquired by the Company and the claims that the Company had against Stuart Lawrenson (the vendor of the Flights Group) under the Acquisition Agreement. CPS had commenced legal proceedings against Stuart Lawrenson and others. However, as set out in the announcement made by the Company on December 30th 2005, the Company, the Flights Group of companies, Central Parking Corporation ('CPC') and its subsidiary, CPS, have agreed a final settlement between them, and with Stuart Lawrenson. The resolution of this issue has been a major focus for management in the last four months. In addition, it has become clear that the Company has inherited a number of unsatisfactory and uneconomic commercial arrangements which are proving problematic. The Board continues to review these arrangements and appropriate provision will be made in the accounts for the year ended 30th November 2005 for contracts that are shown to be onerous. Consequently the acquired businesses will incur larger losses in the year ended 30th November 2005 than originally anticipated and the adverse effects of the uneconomic arrangements referred to above will continue until they can be ended or re-negotiated. These underlying losses, though declining, will continue into the year ending November 30th 2006 and will not finally be eradicated until 2007. To the extent that these losses are provided for in the group accounts for the year ended 30th November 2005, they will not have an impact on subsequent years. The Board has in the meantime been working hard to reduce costs and eliminate unprofitable activities. These actions are beginning to bear fruit in the reduction of losses from month to month. Although the contract to operate the route 210 service for National Express Plc will end on January 26th 2006, the revenue represented by this contract (some £2m per annum) has been replaced by equivalent revenue at significantly better margins with other customers largely within the airline sector. Taken together with the continuing successful efforts to win other new contracts and build profitable turnover, the Directors consider that the Company is now moving in the right direction to achieve profitability for the Group. The attached interim statement incorporates the results of the Company as an investment company only from January 21st 2005 until August 30th 2005, consolidated with, for September 2005 only, the results of the Flights Group of companies for that month. Potential equity fundraising As a result of the increased turnover of the Company, the continuing losses and the diversion of effort resultant upon the problems with Stuart Lawrenson and CPC, the Directors consider that it is prudent to augment the working capital requirements of the Company. The opportunities for organic and acquisitive growth have not diminished and the Company has been successful in negotiating improved banking facilities to cover working capital requirements, leasing finance and the potential acquisition of new contracts. The Directors have determined that new equity funding should be raised to augment these facilities and are proposing to raise up to £1,500,000, with a minimum target of £600,000. The Directors propose to underwrite the minimum target of £600,000. The funding will be under the EIS relief scheme and the pricing will be determined in due course, but is expected to be within the current market price. The objectives set out in the admission document dated March 11th 2005 and the re-admission document dated August 9th 2005, can now be pursued. These require a strong financial base, which the above will satisfy, so that the Board will be able to implement these objectives in the coming months and years. The Board looks forward to creating an integrated, specialist transport company and believes it is well positioned to do so from the attractive platform provided by the Flights Group. Further details of the proposed fundraising are expected to be announced shortly. John Gunn Chairman 10th January, 2006 Contacts: Nick Fox, M: Communications 020 7153 1540/ 07711 727 618 Notes to Editors: The Company was admitted to trading on AIM on March 29th 2005, having been incorporated on January 21st 2005 to invest in the parking and transportation sectors. In the transport sector, the Board anticipated that opportunities would arise in the provision of bus services, chauffeur-drive services, and integrated ground transportation. In the Company's admission document dated March 11th 2005 the Board stated its intention to complete the Company's first acquisition within six months of Admission and in August 2005 it agreed the acquisition of the Flights Group of companies. The Flights Group comprises three companies: Flights Hallmark, Flights Corporate Transfers and FH Transport. Flights Hallmark is a mature coach and bus business formed through the acquisition and amalgamation of a number of businesses. Its main activities include the provision of dedicated transport solutions for a range of corporate customers, the operation of various shuttle bus services and a substantial coach hire business. Flights Corporate Transfers operates chauffeur driven cars, particularly relating to transport to and from UK airports, for a range of airlines and airline-related customers. The third company, FH Transport, does not currently trade but holds certain contracts with customers relating to the business operated by the other members of the Flights Group. Profit and loss account Notes Period ended 30 September 2005 £ Turnover - Acquired Business 1 1,361,070 Cost of sales - Acquired Business 4 (1,491,854) ------ Gross profit (130,784) Administrative expenses - continuing business 1 (159,704) - acquired business (88,079) ------ (247,783) ______ ------ Operating Loss - Continuing Business 1 (159,704) - Acquired Business 4 (218,863) Loss on ordinary activities before interest (378,567) Net Interest receivable 57,580 _______ Loss on ordinary activities before taxation (320,987) Tax on loss from ordinary activities Nil _______ Loss on ordinary activities after taxation (320,987) Retained profit brought forward Nil _______ Accumulated loss carried forward (320,987) ======== Loss per share - basic and diluted 0.40p Consolidated Balance Sheet Notes At 30 September 2005 £ Fixed assets Intangible assets 6,439,827 Tangible assets 543,876 ------ 6,983,703 Current assets Debtors 5,344,940 Cash at bank and in hand 1,662,700 ------ 7,007,640 Creditors: amounts falling due within one year (5,822,230) ------ Net current assets 1,185,410 ------ Total assets less current liabilities 8,169,113 Creditors: amounts falling due after more than (1,106,297) one year ------ 7,062,816 ------ Capital and reserves Called up share capital 1,719,744 Share Premium Account 3,097,392 Merger reserve 2,566,667 Profit and loss account (deficit) (320,987) ------ Shareholders' funds 7,062,816 ======= Cash flow statement Notes Period ended 30 September 2005 £ Net cash outflow from operating activities 5 (916,165) Returns on investments and servicing of finance Interest received 61,376 Interest paid (17,419) ------ Net cash inflow from returns on investments and 43,957 servicing of finance ------ Capital expenditure and financial investment Loans to subsidiaries prior to acquisition (870,000) ------ Net cash outflow from capital expenditure (870,000) and financial investment ------ Acquisitions Expenses incurred in making the acquisitions (603,835) Bank overdraft acquired with acquisitions (336,884) _______ Cash outflow from acquisitions (940,719) ------ Cash outflow before use of liquid resources and (2,682,927) financing Financing Issue of ordinary share capital 4,660,000 Issue costs (309,530) Capital element of finance lease payments (4,843) ------ Cash inflow from financing 4,345,627 ------ Increase in cash for the period 1,662,700 ======= Notes to the unaudited interim statement for the period ended 30th September 2005 1 Basis of Preparation: The financial information for the period has not been audited or reviewed. These consolidated accounts represent the accounts of Rotala plc only from 21 January 2005 (the date of incorporation) until 30 September 2005 (the 'Continuing Business') and the results of the Flights Group of companies from 30 August 2005 (the date of acquisition) to 30 September 2005 (the 'Acquired Business'). 2 Accounting policies: the accounting policies used in this statement are the same as those which were used for the preparation of the accounting information contained within the document sent to shareholders dated 9 August 2005 and those which are intended to be used in the accounts for the period ended 30 November 2005. 3 Loss per share: loss per share has been calculated in a manner based upon the weighted average number of shares in issue in the period of 81,011,893. The share options outstanding at the period end were not dilutive. 4 Intangible assets: goodwill arising has been calculated upon the basis of the effects of the transactions carried out to assemble the Flights Group of companies and their subsequent acquisition by Rotala. As explained in the Chairman's statement a review of onerous contracts is being conducted which may result in the recognition of further amounts of goodwill. In drawing up the statutory accounts for the period ended 30 November 2005, it will be appropriate to consider the carrying value of goodwill in the group balance sheet and make any necessary provision. Cost of Sales and the Operating Loss for the acquired business include in the period a charge for amortisation of goodwill of £26,945. 5 Reconciliation of Operating Loss to Net Cash Outflow: Reconciliation of Operating Loss to Net Cash Outflow from Operating Activities Operating Loss (378,567) Amortisation of goodwill 26,945 Depreciation 10,610 Increase in debtors (1,071,909) Increase in creditors 496,756 _________ Net Cash Outflow from Operating (916,165) Activities _________ 6 Summarised Balance Sheet of the Acquisitions at 30 August 2005: Summarised Balance Sheet of the Acquisitions Intangible assets 524,831 Tangible assets 554,486 Debtors 4,259,410 Bank Overdraft (336,884) Loan from Rotala plc (870,000) Creditors (5,636,614) _________ Net liabilities (1,504,771) _________ 7 Post Balance Sheet Events: as referred to in the Chairman's Statement, on 30 December 2005 the Company made an announcement which set out in detail the settlement of the disputes which surrounded the acquisition of the Flights Group of companies. 8 Additional Information: this Interim Report does not constitute statutory accounts within the meaning of s.240 of the Companies Act 1985. Because the Company was only formed on 21 January 2005 accounts have yet to be prepared for the Company's first accounting period, which ended on 30 November 2005. Consequently no accounts have been subject to audit and none has been filed with the Registrar of Companies. 9 Other: copies of this Interim Report can be obtained by request from the company's registered office at 46, Cannon Street, London, EC4N 6JJ. This information is provided by RNS The company news service from the London Stock Exchange BLBBQ

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