Final Results

Worldsec Ld 30 April 2003 Worldsec Limited Preliminary Statement of Annual Results Worldsec Limited is pleased to release today its preliminary statement of annual results for the year ended 31 December 2002. The directors do not recommend the payment of a dividend. The Chairman's Statement and extracts from the audited financial statements are reproduced below. Investor Relations For further information please contact: In Hong Kong Mr Paul K K Cheng Chief Operating Officer and Finance Director +852 2867 7213 CHAIRMAN'S STATEMENT RESULTS The audited consolidated loss after taxation was US$7.87m (2001: US$7.96m). Loss per share based on the weighted average number of shares in issue during the year amounted to US 59 cents (2001: US 60 cents). THE YEAR IN REVIEW Operating conditions in agency broking and corporate finance continued to be difficult and the prospects of improvement were not bright. The Board of Directors recommended in the circular dated 1st August 2002 to shareholders, the disposal of two subsidiaries, research materials and certain trading assets of the Group to UOB Kay Hian Private Limited, resulting in the Group's withdrawing from broking, research and corporate finance activities. Shareholders approved the disposals at the special general meeting held on 19th August 2002. In connection with these disposals, on 1st October 2002, a majority of the Group's staff involved in broking and corporate finance took up employment with the purchaser. The Group also sold to the same purchaser its Futures Trading Right and B Share Trading Seat in the Shanghai Stock Exchange. Following these disposals, the Group has practically completed its withdrawal from the broking business which began with the closure of its Philippines and Malaysian offices in 2001. The Group now comprises a number of subsidiaries which have no significant trading activity. These subsidiaries, together with the Company are still holding certain assets which were used to facilitate trading activities, including brokerage trading rights on the Hong Kong stock market. Other assets of the Group include investments, debtors, cash, and some fixed assets. All the Group's assets are stated in the financial statements at their expected recoverable amounts and provisions have been made where appropriate for impairment. Chairman's Statement PROSPECTS The Group is in the process of realizing its assets into cash. Certain assets of the Group such as its remaining brokerage trading rights and office property in the Philippines would take time to dispose. The Directors intend to invest the cash raised from liquidating assets in money market investments and deposits whilst appropriate steps are taken in preparation for returning the proceeds to shareholders as soon as possible. In the absence of unforeseen circumstances, we expect to make the first interim distribution to shareholders in the third quarter of 2003 with further distribution as and when the remaining assets of the Group are realised. David Archibald Evelyn Lyle Non-Executive Chairman 30-Apr-2003 CONSOLIDATED PROFIT AND LOSS ACCOUNT AT 31 DECEMBER 2002 Year ended 31 December Notes 2002 2001 US$'000 US$'000 Turnover 1 5,402 8,035 Fees and commissions payable (1,131) (1,155) ___________ ___________ 4,271 6,880 Gain on disposal of intangible assets 159 181 Gain on disposal of investments - 541 Unrealised gain on investments 93 - Recovery of doubtful receivables - 232 Other operating income 662 794 ___________ ___________ 5,185 8,628 Staff costs (6,382) (8,305) Provision for doubtful receivables (3,250) (1,193) Loss on revaluation of investments - (1,824) Impairment losses (201) - Other operating costs (3,062) (4,397) ___________ ___________ Operating loss 1 (7,710) (7,091) Interest receivable and similar income 204 473 Interest payable and similar charges (277) (480) Provision for closure of operations - (123) Goodwill written off - (591) Loss on disposal of subsidiaries and research materials (111) - ___________ ___________ Loss on ordinary activities before taxation (7,894) (7,812) Tax on loss on ordinary activities 2 27 (149) ___________ ___________ Loss for the financial year (7,867) (7,961) =========== =========== Loss per share - basic and diluted 3 (59) cents (60) cents =========== =========== CONSOLIDATED BALANCE SHEET AT 31 DECEMBER 2002 Notes 2002 2001 US$'000 US$'000 Fixed assets Intangible assets - 875 Tangible fixed assets - 832 Investments - 1,271 ___________ ___________ - 2,978 ___________ ___________ Current assets Investments 3,047 1,548 Debtors 5,698 25,086 Bank deposits and cash 18,011 36,167 ___________ ___________ 26,756 62,801 Creditors: Amounts falling due within one year (10,735) (41,541) ___________ ___________ Net current assets 16,021 21,260 ___________ ___________ Total assets less current liabilities 16,021 24,238 Provisions for liabilities and charges - (30) ___________ ___________ Net assets 16,021 24,208 =========== =========== Capital and reserves Called up share capital 13,367 13,367 Share premium 11,664 11,664 Special reserve 625 625 Profit and loss account (8,967) (1,270) Revaluation reserve 294 989 Currency translation reserve (962) (1,167) ___________ ___________ Equity shareholders' funds 16,021 24,208 =========== =========== CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2002 Year ended 31 December Note 2002 2001 US$'000 US$'000 Cash outflow from operating activities (1,073) (2,207) ___________ ___________ Returns on investments and servicing of finance Interest received from banks and deposit taking companies 204 473 Interest paid on bank loans and overdrafts (277) (480) ___________ ___________ Net cash outflow from returns on investments and servicing of finance (73) (7) ___________ ___________ Taxation Tax paid (144) (230) ___________ ___________ Capital expenditure and financial investment Sale of intangible assets 443 458 Purchase of tangible fixed assets - (166) Sale of tangible fixed assets 149 - ___________ ___________ Net cash inflow from capital expenditure and financial investment 592 292 ___________ ___________ Acquisition and disposal Net cash inflow from disposal of subsidiaries 53 - Net cash outflow from disposal of research materials and futures (63) - trading right ___________ ___________ Net cash outflow from acquisition and disposal (10) - ___________ ___________ Net cash outflow before use of liquid resources and financing (708) (2,152) Management of liquid resources Decrease/(increase) in time deposits of maturity exceeding 1 day 2,427 (71) ___________ ___________ Decrease in cash 5 (1,719) (2,223) =========== =========== NOTES TO THE PRELIMINARY STATEMENT OF ANNUAL RESULTS FOR THE YEAR ENDED 31 DECEMBER 2002 1. ANALYSIS OF TURNOVER, OPERATING LOSS AND NET ASSETS The turnover attributable to the different classes of the Group's business is as follows: Year ended 31 December 2002 2001 US$'000 US$'000 Analysis by class of business: Broking and related services 4,683 6,389 Corporate finance 719 1,646 _______ ______ 5,402 8,035 ======= ====== Geographical analysis of turnover: Hong Kong 4,420 6,369 Thailand 889 1,012 Malaysia 6 46 Singapore 37 130 Philippines 6 76 Others 44 402 _______ ______ 5,402 8,035 ======= ====== The operating loss attributable to the different classes of the Group's business is as follows: Broking and related services (7,586) (7,637) Corporate finance (124) 546 _______ ______ (7,710) (7,091) ======= ====== The operating loss of the Group is mainly derived from the Group's operations based in Hong Kong. The net assets utilised in the Group relate substantially to broking activities and situated in Hong Kong. 2. TAX ON LOSS ON ORDINARY ACTIVITIES Year ended 31 December 2002 2001 US$'000 US$'000 The credit/(charge) comprises: UK Corporation Tax current year at 30% (2001: 30%) - (46) Hong Kong Profits Tax current year at 16% (2001:16%) 2 (86) Other overseas taxation (5) (19) ___________ ___________ (3) (151) Deferred taxation 30 2 ___________ ___________ 27 (149) =========== =========== 3. LOSS PER SHARE Calculation of loss per share was based on the following: Year ended 31 December 2002 2001 Loss for the financial year US$(7,867,000) US$(7,961,000) ============ ============ Weighted average number of shares in issue 13,367,290 13,367,290 ============ ============ Loss per share (59) cents (60) cents ============ ============ 4. RECONCILIATION OF OPERATING LOSS TO NET CASH OUTFLOW FROM OPERATING ACTIVITIES Year ended 31 December 2002 2001 US$'000 US$'000 Operating loss (7,710) (7,091) Gain on disposal of intangible assets (159) (181) (Gain)/loss on disposal of tangible fixed assets (38) 81 Depreciation 196 301 Provision for doubtful receivables 3,250 1,193 Loss on revaluation of investments - 1,824 Unrealised gain on investments (93) - Impairment loss 201 - Amortisation of intangible assets 93 118 Amortisation of purchased goodwill - 197 Exchange difference 207 (38) Decrease in investments held as current assets 67 199 Decrease/(increase) in trade debtors 16,761 (9,492) (Increase)/decrease in other debtors and prepayments (580) 1,264 Decrease in cash at bank - trust accounts 10,214 5,048 (Decrease)/increase in trade creditors (23,982) 4,846 Increase/(decrease) in other creditors and accruals 500 (476) _____________ ____________ NET CASH OUTFLOW FROM OPERATING ACTIVITIES (1,073) (2,207) ============= ============ 5. RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET FUNDS Year ended 31 December 2002 2001 US$'000 US$'000 Increase/(decrease) in cash 1,719 (2,223) Cash (inflow)/outflow from (decrease)/increase in liquid resources (2,427) 71 _____________ ____________ Movement in net funds (708) (2,152) Net funds brought forward 10,106 12,258 _____________ ____________ Net funds carried forward 9,398 10,106 ============ =========== This information is provided by RNS The company news service from the London Stock Exchange

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