Interim Results

RNS Number : 7498P

Immersion Technologies Intl PLC

30 March 2009

 



For immediate release                                                                                                                 30 March 2009 

IMMERSION TECHNOLOGIES INTERNATIONAL PLC

('Immersion' or the 'Company')

UNAUDITED INTERIM RESULTS FOR 6 MONTHS 

   ENDED 31 DECEMBER 2008

CHAIRMAN'S STATEMENT

I am pleased to report Immersion's interim results for the 6 months ended 31 December 2008.  

Results

The group made a loss for the six month period ended 31 December of £307,000 on a turnover of £24,000.

Review of Operations

The Technology

The Company has made progress in the evolution of the technology as follows:

Electrostatic Loudspeakers (ESL)

The technology has successfully been tailored towards specific requirements of various large-scale prospect customers. The ongoing customer demonstrations and feedback have provided a deeper insight into the needs and requirements for mainstream applications of ESL in Consumer Electronics markets (ie smaller sizes, higher sound pressure levels, and lower pricing for TV & Home-Theatre). The Company has been able to work within these requirements and has successfully delivered sample units which are currently being evaluated by various prospects. 

Conventional Cone Loudspeakers (CCL)

The Company is looking to expand on the new and smaller prototypes of CCL speakers that were demonstrated at the Korea Audio Show in October 2008. These speakers were designed as a cost competitive solution and demonstrated high fidelity/high sound pressure level as well as being a small footprint (3 inch in size). This application is applicable for consumer electronic customers as well as automotive. 

Trade Shows

During the year, the Company continued to generate positive interest from various customer demonstrations and trade shows. Company continues to produce sample and prototypes for potential customers in order to obtain a volume order for its products.

Overseas Facilities

The closure of overseas facilities as reported previously are nearing completion. The Company is developing alternatives for cost-efficient production of sample and prototypes. Headcount across the Group has been further reduced to focus on commercialisation of technologies while minimising spend.

Nakamichi

The Company is looking to pursue a commercial negotiation with Nakamichi given Nakamichi's failure to take products pursuant to the supply agreement. The Company is proposing to settle the matter by mediation but if it cannot be resolved by commercial means then the Company will consider legal action in order to preserve the Company's rights.

Outlook

Recent developments in the global markets for Consumer Electronics have unilateral impact on the application of new and innovative technologies for prospect customers. Based however on the ongoing positive interest from potential customers the Management remains confident on the validity and future potential of the Company's technologies, albeit that larger scale applications may suffer further delays due to overall conditions in the global markets. 

The Company will look at other opportunities in order to preserve shareholder value within the Company and in the meantime we will actively conserve our cash as much as possible.

CONTACTS:

Immersion Technologies International Plc

Kiran Morzaria            Tel: [phone]

Beaumont Cornish

Roland Cornish            Tel: [phone]

GROUP INCOME STATEMENT
FOR THE INTERIM PERIOD ENDED 31 DECEMBER 2008
	Notes	Six months ended		Six months ended		Year ended
		31 December 2008		31 December 2007		30 June 2008
		(Unaudited)		(Unaudited)		(Audited)
		£  000's		£ 000's		£ 000's
Revenue		24		27		69
Cost of sales		(14)		(82)		(271)
Gross profit/(loss)		10		(55)		(202)
Administrative expenses		(319)		(1,000)		(2,309)
Group  operating loss		(309)		(1,055)		(2,511)
Interest receivable		2		32		42
Loss before taxation		(307)		(1,023)		(2,469)
Income tax expense		-		-		-
Loss for the period
attributable to shareholders	2	(307)		(1,023)		(2,469)
LOSS PER SHARE (pence)
Basic/Diluted	3	0.12		0.45		1.08

GROUP BALANCE SHEET
		As at				As at		As at
	Notes	31 December 2008				31 December 2007		30 June 2008
		(Unaudited)				(Unaudited)		(Audited)
		£ 000's				£ 000's		£ 000's
Non-current assets
Intangible assets		800				6,562		800
Plant and equipment		-				138		-
		800				6,700		800
Current assets
Trade and other receivables		54				273		49
Inventories		48				121		-
Cash and cash equivalents		24				919		272
		126				1,313		321
Total assets		926				8,013		1,121
Current liabilities
Trade and other payables		(186)				(117)		(273)
Provisions		(2)				-		(2)
Prepayments		-				(86)		-
Total liabilities		(188)				(203)		(275)
Net assets		738				7,810		846
Equity
Share capital	4	1,857				1,586		1,598
Share premium reserve		2,950				2,855		2,869
Unissued Share Capital		-				-		185
Foreign exchange reserve		84				64		60
Other reserves		20				5,730		-
Share-based payments		80				75		80
Accumulated loss		(4,253)				(2,500)		(3,946)
		738				7,810		846

GROUP CASH FLOW STATEMENT
FOR THE INTERIM PERIOD ENDED 31 DECEMBER 2008
		Six months ended		Six months ended		Year ended
		31 December 2008		31 December 2007		30 June 2008
		(Unaudited)		(Unaudited)		(Audited)
		£ 000's		£ 000's		£ 000's
OPERATING ACTIVITIES
Loss after tax for the period		(309)		(1,055)		(2,511)
Adjustments for:
Depreciation		-		9		172
Amortisation		-		121		246
Loss on disposal of assets		-		-		(5)
Share-based payments		-		15		46
Increase in Provisions		-		-		2
Decrease/(Increase) in receivables		(5)		(13)		210
Decrease/(Increase) in inventories		(48)		(121)		-
(Decrease)/Increase in payables		(87)		(157)		(87)
CASH USED IN OPERATING ACTIVITIES		(449)		(1,201)		(1,927)
Income tax paid		-		(12)		(12)
NET CASH USED IN OPERATING ACTIVITIES		(449)		(1,213)		(1,939)
INVESTING ACTIVITIES
Interest received		2		32		42
Proceeds from disposal of assets		-		-		5
Purchase of patents		-		-		(44)
Purchase of plant and equipment		-		(78)		(112)
NET CASH USED IN INVESTING ACTIVITIES		2		(46)		(109)
FINANCING ACTIVITIES
Proceeds on issuing of ordinary shares		175		43		43
Proceeds on share capital un-issued		-		-		185
NET CASH FROM FINANCING ACTIVITIES		175		43		228
NET DECREASE IN CASH AND CASH EQUIVALENTS		(272)		(1,216)		(1,820)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD		272		2,122		2,122
Exchange loss on cash and cash equivalents		24		13		(30)
CASH AND CASH EQUIVALENTS AT END OF PERIOD		24		919		272

 GROUP STATEMENT OF CHANGES IN EQUITY FOR THE INTERIM PERIOD ENDED 31 DECEMBER 2008

			Unissued	Share
	Share	Share	Share	Based	Foreign	Other	Accumulated
	Capital	Premium	Capital	Payments	Exchange	Reserves	Losses	Total
	£ 000's	£ 000's	£ 000's	£ 000's	£ 000's	£ 000's	£ 000's	£000's
Group
Balance at 1 July 2007	1,574	2,824	-	60	51	5,730	(1,477)	8,762
Foreign translation differences	-	-	-	-	9	-	-	9
Loss for the period	-	-	-	-	-	-	(2,469)	(2,469)
Total recognised income and expense for the period	-	-	-	-	9	-	(2,469)	(2,460)
Share issue	24	45	185	-	-	-	-	254
Cancelled share based payment	-	-	-	(7)	-	-	-	(7)
Share-based payments	-	-	-	27	-	-	-	27
Impairment charge	-	-	-	-	-	(5,682)	-	(5,682)
Foreign translation differences	-	-	-	-	-	(48)	-	(48)
Balance at 30 June 2008	1,598	2,869	185	80	60	-	(3,946)	846
Foreign translation differences	-	-	-	-	24	-	-	24
Loss for the period	-	-	-	-	-	-	(307)	(307)
Total recognised income and expense for the period	-	-	-	-	24	-	(307)	(283)
Share issue	259	112	(185)	-	-	-	-	186
Cost of share issue	-	(11)		-	-	-	-	(11)
Warrants subscribed	-	(20)	-	-	-	20	-	-
Balance at 31 December 2008	1,857	2,950	-	80	84	20	(4,253)	738

NOTES TO THE INTERIM REPORT FOR THE PERIOD ENDED 31 DECEMBER 2008

1	SIGNIFICANT ACCOUNTING POLICIES
	Basis of preparation
	The financial information has been prepared under the historical cost convention and on a going concern basis and in accordance with International Financial Reporting Standards and IFRIC interpretations adopted for use in the European Union ('IFRS') and those parts of the Companies Act applicable to companies reporting under IFRS. The financial information for the period ended 31 December 2008 has not been audited or reviewed in accordance with the International Standard on Review Engagements 2410 issued by the Auditing Practices Board. The figures were prepared using applicable accounting policies and practices consistent with those adopted in the statutory accounts for the period ended 30 June 2008.  The financial information contained in this document does not constitute statutory accounts as defined by Section 240 of the Companies Act 1985 (England & Wales). In the opinion of the directors the financial information for this period fairly presents the financial position, result of operations and cash flows for this period. This Interim Financial Report was approved by the Board of Directors on 30 March 2009.
	Statement of compliance
	These condensed consolidated interim financial statements have been prepared in accordance with International Accounting Standard ('IAS') 34 - Interim Financial Reporting as adopted by the European Union. Accordingly the interim financial statements do not include all of the information or disclosures required in the annual financial statements.
	Basis of consolidation
	The consolidated financial statements comprise the financial statements of Immersion Technologies International Plc and its controlled entities. The financial statements of controlled entities are included in the consolidated financial statements from the date control commences until the date control ceases. The financial statements of subsidiaries are prepared for the same reporting period as the parent company, using consistent accounting policies. All inter-company balances and transactions have been eliminated in full.
	Foreign currencies
	The functional currency of each entity is determined after consideration of the primary economic environment of the entity. The group's presentational currency is Sterling (£).

2	SEGMENT REPORTING
	For management purposes the Group is organised into 4 operating divisions: Corporate; Product Research, Development and Design; Product Manufacture, and; Sales. These divisions are the basis on which the Group reports its primary segment information. Secondary segment information is presented on a geographic basis. The primary segment information corresponds closely to geographical segments as operational segments reside in distinct locations of the United Kingdom, Australia and Asia.
	Business segments	Corporate	Product		Product		Sales		Unallocated		Total
			R&D and		Manufacture
			Design
	Six months ended 31 December 2008 (Unaudited)	£ 000's	£  000's		£  000's		£  000's		£  000's		£  000's
	Segment Revenue	-	9		-		15		-		24
	Segment loss from operations	(142)	(123)		(32)		(12)		-		(309)
	Interest receivable	2	-		-		-		-		2
	Loss for the period before taxation										(307)

2	SEGMENT REPORTING (CONTINUED)	Corporate	Product	Product	Sales	Unallocated	Total
			R&D and	Manufacture
			Design
	Year  ended 30 June 2008 (Audited)	£  000's	£  000's	£  000's	£  000's	£  000's	£  000's
	Segment Revenue	6	45	-	18	-	69
	Segment loss from operations	(1,178)	(796)	(192)	(345)	-	(2,511)
	Interest receivable						42
	Loss for the period before taxation						(2,469)

	Six months ended 31 December 2007 (Unaudited)
	Segment Revenue	5	22	-	-	-	27
	Segment loss from operations	(471)	(408)	(130)	(46)	-	(1,055)
	Interest receivable						32
	Loss for the period before taxation						(1,023)

		United	Australia	Asia	Unallocated	Total
	Geographical segments	Kingdom
		£  000's	£  000's	£  000's	£  000's	£  000's
	Six months ended 31 December 2008 (Unaudited)
	Segment Revenue	-	9	15	-	24
	Segment loss from operations	(136)	(118)	(55)	-	(309)
	Interest receivable	2	-	-	-	2
	Loss for the period					(307)
	Year ended 30 June 2008 (Audited)
	Segment Revenue	6	45	18	-	69
	Segment loss from operations	(1,260)	(588)	(663)	-	(2,511)
	Interest receivable					42
	Loss for the period before taxation					(2,469)
	Six months ended 31 December 2007 (Unaudited)
	Segment Revenue	5	22	-	-	27
	Segment loss from operations	(597)	(282)	(176)	-	(1,055)
	Interest receivable					31
	Loss for the period before taxation					(1,024)

3	LOSS PER ORDINARY SHARE
The calculation of earnings per share is based on the loss after taxation divided by the weighted average number of share in issue during the period:
		Six months ended 31 December 2008 (Unaudited)	Six months ended  31 December 2007 (Unaudited)	Year ended  30 June 2008 (Audited)
Net loss after taxation (£ 000's)		(307)	(1,023)	(2,469)
Weighted average number of ordinary shares used in calculating basic earnings per share (millions)		259.2	226.8	226.6
Basic loss per share (pence)		(0.12)	(0.45)	(1.08)

As the inclusion of the potential ordinary shares would result in a decrease in the loss per share they are considered to be antidilutive and, as such, a diluted loss per share is not included.

4	SHARE CAPITAL ISSUED
	The authorised share capital of the Company and the called up and fully paid amounts at 31 December 2008  were as follows:

Authorised	Number of shares	£'000
Ordinary shares of £0.007 each	1,000,000,000	7,000
Called up, allotted, issued and fully paid	Number of shares	Nominal value  £000's
Balance at 1 July 2006	342,761,601	343
Consolidation of share capital	(293,795,658)
12 April 2007 for cash at 10.25p per share	175,903,671	1,231
1 July 2007 for non-cash consideration	1,731,645	12
6 May 2008 for non-cash consideration at 1.54p per share	1,623,375	11
16 July 2008 for cash at 1p per share	18,500,000	130
14 August 2008 for cash at 1p per share	17,500,000	122
14 August 2008 for non-cash consideration at 1p per share	1,100,000	8
As at 31 December 2008	265,324,634	1,857

Total share options and warrants in issue

As at 31 December 2008 the options and warrants in issue were;

Exercise Price	Expiry Date	Options in Issue 31 December 2008
21p	19 May 2011	734,489
1.54p	30 April 2018	17,550,000
1.5p (1)	16 July 2013	9,250,000
1.5p (1)	14 August 2013	9,300,000
		36,834,489

(1):  warrants issued in connections with shares issued during the period. 

No options lapsed or were cancelled and no options were exercised during the period ended December 2008. 

5	INVESTMENT IN GROUP COMPANIES
	Company name	Country of incorporation	Proportion of ownership interest
	Immersion Technologies UK Limited	UK	100%
	Immersion Technology Property Limited	UK	100%
	Immersion Technology International Limited	UK	100%
	Immersion Technologies (Singapore) Pte Limited	Singapore	100%
	Immersion Technology (Nanjing) Co. Limited	China	100%
	Immersion Technologies Australia Pty Limited	Australia	100%
	Whise Acoustics Limited	Australia	100%
	Whise Technologies Pty Limited	Australia	100%

6	EVENTS SUBSEQUENT TO THE BALANCE SHEET DATE
	On 6 February 2009 at the Annual General Meeting of the Company, a resolution to subdivide each existing issued and unissued ordinary shares of 0.7p each into one ordinary share of 0.01p each and one deferred share of 0.69p each was approved . The deferred shares have effectively no value and no share certificate in respect of these shares was issued. Share certificates for the existing ordinary shares remains valid. Accordingly, application was made for a total of 265,324,634 ordinary share of 0.01p each to be admitted to trading on AIM and such admission commenced trading on 12 February 2009.
7	The financial information set out above does not constitute the Group's statutory accounts for the period ended 30 June 2008, but is derived from those accounts.
8	A copy of this interim statement is available on the Company's website www.iti-plc.com

 

END

 

 

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