Interim Results
Immersion Technologies Intl PLC
01 May 2007
1st May 2007
Immersion Technologies International plc
('ITI' or the 'Company')
Unaudited Interim Results
The Board of Directors is pleased to present the Company's unaudited interim
results for the six months ended 28 February 2007. Also included below are the
unaudited consolidated interim results for Whise Acoustics and its subsidiary
companies (the 'Whise Acoustics group') for the six months ended 31 December
2006. Whise Acoustics became a subsidiary of ITI on 12 April 2007 when ITI
acquired its parent, Immersion Technology International plc.
Immersion Technology International plc identified the Whise Acoustics group as a
target in 2006 because of its award winning technology and existing
relationships with such companies as Alpine Electronics and Harmon
International. It completed the acquisition of the group on 20 October 2006, as
detailed in the Company's Admission Document dated 15 March 2007.
In the six months ending 31 December 2006 the Whise Acoustics group underwent
significant business and corporate restructuring to make it suitable for the
acquisition. This meant ceasing a joint venture relationship with Whatmough
Monitors Pty Ltd and selling a subsidiary, Precision Audio Pty Ltd. Even though
these two entities produced the majority of the group's revenue in the financial
year ending 31 June 2006 the Directors of Immersion Technology International plc
did not view them as profitable and relevant to its future business strategy.
As a consequence the interim results for the Whise Acoustics group show a fall
in revenue for the period and material charges to the Income Statement to
reflect the write-off of investments and losses on the sale of assets and
investments.
Immersion Technologies International plc (formerly St James's Energy plc)
Unaudited Interim Results for the six months ended 28 February 2007
CHAIRMAN'S STATEMENT
In the Company's AIM admission document dated 5 May 2006, the Board stated its
intention was to make investments in the upstream energy and utilities sector.
The Board considered a number of opportunities within this strategy, of which
two were taken to the advanced negotiation stage and one was taken to the
advanced due diligence stage. However, the Board was unable to identify a
transaction that properly met its investment criteria.
In the reporting period ending 28 February 2007, the Company embarked on
detailed negotiations with a renewable energy technology company that had
significant market potential. However during the due diligence the Directors
determined that the transaction may not deliver above average returns that our
shareholders would require and as a consequence the Company withdrew from
negotiations.
The Board concluded that assets in the upstream energy and utilities sector were
either overpriced or too far away from a revenue stream. It also saw an
increasing number of potential technology transactions and it believes that the
technology sector has been relatively undervalued since 2001. Through its
contacts, it identified Immersion Technology International plc as an excellent
opportunity to enter the audio technology market. Its patented and patent
pending technologies relate to both high performance electrostatic loudspeakers
and award-winning conventional cone loudspeakers. These technologies are
already earning revenues.
The acquisition of Immersion Technology International plc was completed post the
period end after it was approved at an Extraordinary General Meeting held on 11
April 2007. Other resolutions passed included the consolidation of the
Company's share capital on the basis of one new ordinary share for every 7
existing ordinary shares and the change of name from St James's Energy plc to
Immersion Technologies International plc.
As at 24 April 2007 the Company had issued 175,703,671 new ordinary shares to
acquire Immersion Technology International plc and will exercise its right to
compulsorily acquire the remaining 200,000 shares to complete 100% ownership.
The closing price on the day of readmission was 10.25p per share. The total
number of shares on issue, once the compulsory acquisition is completed, will be
224,869,614.
Operational and Financial Review
During the period, the Company received investment income of £83,992 and
incurred administrative expenses of £249,495 resulting in a loss for the period
of £165,426. The main administrative expenses consisted of £42,000 of Directors
fees, £119,399 of professional fees incurred in the due diligence of the
renewable energy technology company, £18,000 of fully serviced office fees and
£20,647 of irrevocable VAT.
Chris Lambert
Non Executive Chairman
INDEPENDENT REVIEW OPINION
Introduction
We have been instructed by the Company to review the financial information
comprising the Income Statement, Statement of Changes in Equity, Balance Sheet,
Cash Flow Statement and notes thereon and we have read the other information
contained in the interim report and considered whether it contains any apparent
misstatements or material inconsistencies with the financial information.
This report, including the conclusion, has been prepared for and only for the
Company for the purpose of their interim report and for no other purpose. We do
not, therefore, in producing this report, accept or assume responsibility for
any other purpose or to any other person to whom this report is shown or into
whose hands it may come save where expressly agreed by our prior consent in
writing.
Directors' responsibilities
The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by the Directors.
Review work performed
We conducted our review in accordance with guidance contained in Bulletin 1999/4
issued by the Auditing Practices Board as if that Bulletin applied. A review
consists principally of making enquiries of the Directors and applying
analytical procedures to the financial information and underlying financial data
and based thereon, assessing whether the accounting policies and presentation
have been consistently applied unless otherwise disclosed. A review excludes
audit procedures such as tests of controls and verification of assets,
liabilities and transactions. It is substantially less in scope than an audit
performed in accordance with International Auditing Standards and therefore
provides a lower level of assurance than an audit. Accordingly we do not
express an audit opinion on the financial information.
Review conclusion
On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the period ended 28
February 2007.
MRI Moores Rowland LLP
Chartered Accountants
3 Sheldon Square
London W2 6PS
INCOME STATEMENT FOR THE PERIOD ENDED 28 FEBRUARY 2007
Notes Six months ended Period from Six months ended
incorporation (22
August 2005) to
28 February 2007 31 August 2006 28 February 2006
Unaudited Audited Unaudited
£ £ £
Revenue - - -
Administrative expenses (249,495) (146,649) (29,032)
Loss from operations (249,495) (146,649) (29,032)
Foreign exchange gain 77 - -
Interest income 83,992 61,951 322
Loss before tax (165,426) (84,698) (28,710)
Income tax expense - - -
Loss after tax (165,426) (84,698) (28,710)
Loss for the period (165,426) (84,698) (28,710)
Loss per share
Basic 5 (0.05)p (0.05)p (0.03)p
Diluted 5 (0.05)p (0.05)p (0.03)p
BALANCE SHEET AS AT 28 FEBRUARY 2007
Notes As at As at As at
28 February 2007 31 August 2006 28 February 2006
Unaudited Audited Unaudited
£ £ £
ASSETS
Current assets
Trade and other receivables 60,869 34,203 98,700
Cash and cash equivalents 3,498,466 3,728,679 43,632
3,559,335 3,762,882 142,332
Total assets 3,559,335 3,762,882 142,332
LIABILITIES
Current liabilities
Trade and other payables 310,370 52,229 19,042
310,370 52,229 19,042
Net current assets 3,248,965 3,710,653 123,290
Net assets 3,248,965 3,710,653 123,290
EQUITY
Share capital 3 342,762 342,762 152,000
Share premium reserve 3,103,144 3,399,406 -
Share-based payment 53,183 53,183 -
Accumulated losses (250,124) (84,698) (28,710)
Total equity 3,248,965 3,710,653 123,290
STATEMENT OF CHANGES IN EQUITY FOR THE PERIOD ENDED 28 FEBRUARY 2007
Attributable to equity holders of the company
Share capital Share Premium Accumulated Share based Total Equity
losses payments
£ £ £ £ £
Balance at 22 August 2005 - - - - -
Share Capital Issued 152,000 - - - 152,000
Accumulated losses - - (28,710) - (28,710)
Balance at 28 February 2006 152,000 - (28,710) - 123,290
Balance at 28 February 2006 152,000 - (28,710) - 123,290
Share issue 190,762 3,937,086 - - 4,127,848
Cost of Share issue - (484,497) - - (484,497)
Share based payments to - (53,183) - 53,183 -
advisors
Accumulated losses - - (55,988) - (55,988)
Balance at 31 August 2006 342,762 3,399,406 (84,698) 53,183 3,710,653
Balance at 31 August 2006 342,762 3,399,406 (84,698) 53,183 3,710,653
Cost of Share issue - (296,262) - - (296,262)
Accumulated losses - - (165,426) - (165,426)
Balance at 28 February 2007 342,762 3,103,144 (250,124) 53,183 3,248,965
CASH FLOW STATEMENT FOR THE PERIOD ENDED 28 FEBRUARY 2007
Notes Six months Period from Six months
ended incorporation ended
(22 August 2005) to
28 February 2007 31 August 28 February
2006 2006
Unaudited Audited Unaudited
£ £ £
OPERATING ACTIVITIES
Cash used in operations 4 (234,020) (128,623) (9,990)
NET CASH FROM OPERATING ACTIVITIES (234,020) (128,623) (9,990)
INVESTING ACTIVITIES
Interest received 83,992 61,951 322
NET CASH FROM INVESTING ACTIVITIES 83,992 61,951 322
FINANCING ACTIVITIES
Cash from financing activities at beginning of - - -
period
Proceeds on issue of ordinary shares - 4,279,848 53,300
Cost of issue of ordinary shares (80,262) (484,497) -
NET CASH FROM FINANCING ACTIVITIES (80,262) 3,795,351 53,300
(230,290) 3,728,679 43,632
NET (DECREASE) /Increase IN CASH AND CASH (230,290) 3,728,679 43,632-
EQUIVALENTS
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 3,728,679 - -
Effect of foreign exchange rate changes 77 - -
CASH AND CASH EQUIVALENTS AT END OF PERIOD 3,498,466 3,728,679 43,632
NOTES TO THE INTERIM RESULTS FOR THE PERIOD ENDED 28 FEBRUARY 2007
1 SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting
The financial statements have been prepared in accordance with and comply with
International Financial Reporting Standards adopted by the European Union. The
principal accounting policies of the company are set out in the Company's 2006
annual report and financial statements.
These financial statements are presented in Sterling since that is the currency
in which the majority of the Company's transactions are denominated.
Basis of preparation
The measurement basis used in the preparation of the financial statements is
historical cost, except for financial assets at fair value through profit or
loss, which have been measured at fair value.
Statutory Accounts
The financial information set out above does not constitute the Company's
statutory accounts as defined by section 240 of the Companies Act 1985. This
Interim report has not been audited, but was the subject of an independent
review.
Business segments
For management purposes, the company is currently organised into one operating
company in the UK and carries out only one principal activity being the making
of investments in the upstream energy sector.
Geographical segments
The company's operations are located only in the UK.
Cash and cash equivalents
Cash and cash equivalents comprise cash in hand, cash at bank and short term
deposits with banks and similar financial institutions.
2 TAXATION
No taxation has been provided due to losses in the period.
3 SHARE CAPITAL
Six months Period Six months
28 ended 28
February 2007 31 August 2006 February 2006
Unaudited Audited Unaudited
£ £ £
Ordinary shares of £0.001 each
Authorised:
1,000,000,000 ordinary shares of £0.001 each 1,000,000 1,000,000 1,000,000
Issued and Fully Paid:
342,761,601 (31 August 2006: 342,761,601; and 28 February 342,762 342,762 152,000
2006: 152,000,000) ordinary shares of £0.001 each
All of the following share capital was issued in order to incorporate the
company and provide working capital.
(1) On 22 August 2005 the company issued 2 ordinary shares at £0.001 per share
for cash consideration.
(2) On 27 October 2005 the company issued 53,299,998 ordinary shares at £0.001
per share for cash consideration.
(3) On 15 November 2005 the company issued 98,700,000 ordinary shares at £0.001
per share for cash consideration.
(4) On 21 March 2006 the company issued 55,000,000 ordinary shares at £0.001
per share for cash consideration.
(5) On 19 May 2006 the company issued 135,761,601 ordinary shares at £0.03 per
share for cash consideration.
4 RECONCILIATION OF LOSS FROM OPERATIONS TO NET CASH USED IN OPERATING
ACTIVITIES
Six months Period Six months
28 February ended 28
2007 31 August 2006 February 2006
Unaudited Audited Unaudited
£ £ £
Loss from operations (249,495) (146,649) (29,032)
Adjustments for:
Increase in receivables (26,666) (34,203) -
Increase in payables 42,141 52,229 19,042
Cash used in operations (234,020) (128,623) (9,990)
5 Basic and diluted loss per ordinary share
The calculation of basic loss per share is based on loss after taxation of
£165,426 (2006: £28,710) and on 342,761,601 ordinary shares (2006:89,330,001),
being the weighted average number of ordinary shares on issue during the period.
The calculation of diluted loss per share is based on loss after taxation of
£165,426 and on 347,903,025 ordinary shares (2006: 89,330,001), being the
weighted average number of ordinary shares on issue during the period.
6 POST BALANCE SHEET EVENTS
On 11 April 2007 the Company completed the acquisition of Immersion Technology
International plc when a resolution was passed at an Extraordinary General
Meeting. The shareholders also approved the consolidation of every seven
ordinary shares of 0.1p each into one new ordinary share of 0.7p each, as well
as changing the name of the Company from St James's Energy plc to Immersion
Technologies International plc.
As of 24 April 2007 the Company has issued 175,703,671 new ordinary shares to
acquire Immersion Technology International plc and will exercise its right to
compulsorily acquire the remaining 200,000 shares to complete 100% ownership.
The closing price on the day of readmission was 10.25p per share. The total
number of shares on issue, once the compulsory acquisition is completed, will be
224,869,614.
Whise Acoustics Limited
Unaudited Interim Results for the six months ended 31 December 2006
Independent Auditor's Review Report
Report on the Half-Year Financial Report
We have reviewed the accompanying half-year financial report of Whise Acoustics
Limited, which comprises the balance sheet as at 31 December 2006, and the
income statement and cash flow statement for the half-year ended on that date
and the directors' declaration of the company at the end of the half-year.
Directors' Responsibility for the Half-Year Financial Report
The directors of the company are responsible for the preparation and fair
presentation of the half-year financial report in accordance with Australian
Accounting Standards (including the Australian Accounting Interpretations). This
responsibility includes designing, implementing and maintaining internal control
relevant to the preparation and fair presentation of the half-year financial
report that is free from material misstatement, whether due to fraud or error;
selecting and applying appropriate accounting policies; and making accounting
estimates that are reasonable in the circumstances.
Auditor's Responsibility
Our responsibility is to express a conclusion on the half-year financial report
based on our review. We conducted our review in accordance with Auditing
Standard on Review Engagements ASRE 2410 Review of an Interim Financial Report
Performed by the Independent Auditor of the Entity, in order to state whether,
on the basis of the procedures described, we have become aware of any matters
that makes us believe that the financial report is not in accordance with the
Corporations Act 2001 including: giving a true and fair view of the consolidated
entity's financial position as at 31 December 2006 and its performance for the
half-year ended on that date. As the auditor of Whise Acoustics Limited, ASRE
2410 requires that we comply with the ethical requirements relevant to the audit
of the annual financial report.
A review of a half-year financial report consists of making enquiries, primarily
of persons responsible for financial and accounting matters, and applying
analytical and other review procedures. A review is substantially less in scope
than an audit conducted in accordance with Australian Auditing Standards and
consequently does not enable us to obtain assurance that we would become aware
of all significant matters that might be identified in an audit. Accordingly,
we do not express audit opinion.
Auditor's Independence Declaration
In conducting our review, we have complied with the independence requirements of
the Corporations Act 2001.
Conclusion
Based on our review, which is not an audit, we have not become aware of any
matter that makes us believe that the half-year financial report of Whise
Acoustics Limited is not in accordance with the Corporations Act 2001,
including:
(a) giving a true and fair view of the consolidated entity's financial position
as at 31 December 2006 and of its performance for the half-year ended
on that date; and
(b) complying with Accounting Standard AASB 134 Interim Financial Reporting
and the Corporations Regulations 2001.
Yours faithfully
LEYDIN FREYER CORPORATE PTY LTD
Chartered Accountants
M J LEYDIN
Director
INCOME STATEMENT FOR THE HALF YEAR ENDED 31 DECEMBER 2006
6 Months 12 Months
Consolidated Consolidated
31 December 30 June 2006
2006 AUS$
AUS$
Revenues from Ordinary Activities 66,436 294,785
Expenses from ordinary activities, excluding borrowing costs
expenses
Cost of sales (4,192) (95,845)
Other income - 108,605
Employment costs (184,555) (285,216)
Share based payments - (2,085)
Depreciation and amortisation expenses (1,108) (12,534)
Write off of investments (414,715) -
Administrative expenses (221,185) (183,821)
Loss on sale of assets (112,276) -
Write off of goodwill on consolidation (300,197) -
Loss on sale of investments (922,344) (204,074)
(2,168,453) (380,185)
Borrowing costs expense - (1,970)
Profit/(loss) before income tax expense (income tax revenue) (2,094,136) (382,155)
Income tax revenue/(write back) (2,950) 2,950
Net profit/(loss) after income tax (2,097,086) (379,205)
Net profit/(loss) attributable to outside equity interests - -
Net loss after income tax expense attributable to the members of
the parent equity (2,097,086) (379,205)
BALANCE SHEET AS AT 31 DECEMBER 2006
6 Months 12 Months
Consolidated Consolidated
31 December 2006 30 June 2006
AUS$ AUS$
CURRENT ASSETS
Cash and cash equivalents 26,541 112,172
Trade and other receivables 56,309 106,896
Inventories 17,453 18,100
Deferred tax assets - 2,950
Other current assets - 16,514
TOTAL CURRENT ASSETS 100,303 256,632
NON-CURRENT ASSETS
Other financial assets - -
Property, plant and equipment 47,096 19,512
Intangible assets - 405,367
TOTAL NON-CURRENT ASSETS 47,096 424,879
TOTAL ASSETS 147,399 681,511
CURRENT LIABILITIES
Trade and other payables 58,965 76,782
Provisions 4,323 9,151
TOTAL CURRENT LIABILITIES 63,288 85,933
NON-CURRENT LIABILITIES
Trade and other payables 250,511 -
TOTAL NON-CURRENT LIABILITIES 250,511 -
TOTAL LIABILITIES 313,799 85,933
NET ASSETS (166,400) 595,578
EQUITY
Issued capital 2,657,327 2,016,024
Reserves 10,701 10,701
Accumulated losses (2,834,428) (1,437,147)
Parent entity interest (166,400) 595,578
Outside equity interest - -
Total Equity (166,400) 595,578
STATEMENT OF CASH FLOWS FOR THE HALF YEAR ENDED 31 DECEMBER 2006
Consolidated Consolidated
31 December 2006 30 June 2006
AUS$ AUS$
CASH FLOW FROM OPERATING ACTIVITIES
Receipts from customers 66,241 292,230
Payments to suppliers and employees (333,414) (555,071)
Borrowing costs paid - (1,970)
Net cash used in operating activities (267,173) (264,811)
CASH FLOW FROM INVESTING ACTIVITIES
Proceeds from sale of assets 1 -
Payment for investments - (371,074)
Proceeds from sale of investments 50 186,300
Payment for other non current assets (31,550) (22,108)
Net cash used in investing activities (31,499) (206,882)
CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from share issue - 612,500
Payment of loans (37,470) -
Payments to related entities (29,489) (32,201)
Payments from related entities 280,000 -
Net cash provided by financing activities 213,041 580,299
Net decrease in cash held (85,631) 108,606
Cash at beginning of period 112,172 3,566
Cash at end of period 26,541 112,172
- ends -
For information please visit www.iti-plc.com or enquire to:
Immersion Technology International plc
Craig Evans/Blair Snowball +44 (0) 20 7016 5107
Nabarro Wells
Hugh Oram/Anthony Rowland +44 (0) 20 7710 7400
Pelham Public Relations
Archie Berens/Hugh Barker +44 (0) 20 7743 6670
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