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Legendary Invest PLC (LEG)

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Tuesday 23 September, 2008

Legendary Invest PLC

Final Results

RNS Number : 0335E
Legendary Investments PLC
23 September 2008
 




LEGENDARY INVESTMENTS PLC

PRELIMINARY RESULTS FOR THE YEAR ENDED 31 MARCH 2008

HIGHLIGHTS

* Record profit (before and after tax) of £524,000 (2007: £Nil).

* Company net asset position restored, with £484,000 of net assets (2007: £(40,000)).



 

CHIEF EXECUTIVE'S STATEMENT
 
REVIEW OF ACTIVITIES 


In the year under review, the Company assessed investments, both on and off-market, where the investee companies might benefit from the Company's hands-on investment process in which the investees are assisted in certain areas such as product development and marketing. No suitable candidates were found.


In order to utilise available assets, certain medium term investments were made in listed equity securities. The Board is pleased to report that the realisation of certain of these trading investments resulted in gains of £633,000. This compares with net losses on investments of £93,000 for the previous year. This year's gains clear the shareholders' deficit of £40,000 and return the Company to positive net assets of £484,000.


Administrative expenses amounted to £110,000. This compares with administrative expenses of £77,000 for last year (see note 2). Last year, the Chief Executive waived his salary of £35,000, whereas this year, in light of the Company's performance, he drew his salary.


Overall, your Company had profit (before and after tax) of £524,000 (2007: £Nil). The balance sheet is also stronger with cash of £711,000 as at the year end.

 

OUTLOOK


The Board looks forward to building on this year's success.  The Company will continue to assess investments, both on and off-market, and where appropriate, invest. 


Eaitisham Ahmed
Chief Executive 
23 September 2008
 
Registered Office: 
 
2nd Floor
Berkeley Square House
Berkeley Square
London W1J 6BD


For further information please contact: 

 

Zafar Karim, Legendary Investments                        0207 887 1335     
James Caithie, Dowgate Capital Advisers Limited     0207 492 4777 



 

PROFIT AND LOSS ACCOUNT

For the year ended 31 March 2008


 
Note
2008
£’000
2007
£’000
Net gain/(loss) on investments held for trading
 
633
(93)
Net administrative (expenses)/income
2
(110)
93
 
 
                               
                               
Gross profit
 
523
-
Interest receivable
 
1
-
 
 
                               
                               
Profit on ordinary activities before taxation
1
524
-
Tax on profit on ordinary activities
4
-
-
 
 
                               
                               
Profit for the financial year
10
524
-
 
 
                               
                               
Earnings per share
- basic and fully diluted
 
5
0.08p
(0.0p)
 
 
                               
                               

 


A separate statement of recognised gains and losses has not been prepared as the Company has no recognised gains or losses in the current or prior period other than the profit noted above.



All activities derive from continuing operations



BALANCE SHEET

As at 31 March 2008


 
 
2008
2007
 
Notes
£’000
£’000
Current assets
 
 
 
 
Financial assets held for trading
6
3,125
75
Cash at bank and in hand
 
711
4
 
 
                               
                               
 
 
3,836
79
CREDITORS: amounts falling due within one year
7
(3,352)
(119)
 
 
                               
                               
NET ASSETS/(LIABILITIES)
 
484
(40)
 
 
                               
                               
Capital and reserves
 
 
 
Called up share capital
8
628
628
Share premium account
 
8,270
8,270
Profit and loss reserve - deficit
10
(8,414)
(8,938)
 
 
                               
                               
Equity Shareholders’ FUNDS/(DEFICIT)
11
484
(40)
 
 
                               
                               

 


 


CASH FLOW STATEMENT

For the year ended 31 March 2008

 
Notes
2008
£’000
2007
£’000
Net cash outflow from operating activities  
12
(140)
(77)
returns on investments and servicing of finance
 
 
 
Interest received
 
1
-
CAPITAL EXPENDITURE AND FINANCIAL INVESTMENTS
 
 
 
Payments to acquire current asset investments
 
(7,590)
(199)
Receipts form current asset investments
 
8,479
132
 
 
            
            
NET CASH INFLOW/(OUTFLOW) FROM INVESTING ACTIVITIES
 
889
(67)
 
 
            
            
NET CASH INFLOW/(OUTFLOW) BEFORE FINANCING
 
750
(144)
 
Financing
 
 
 
Director’s loan
 
(43)
105
 
 
            
            
INCREASE/(DeCREASE) in cash
14
707
(39)
 
 
            
            



 

NOTES TO THE PRELIMINARY RESULTS



Accounting convention

The accounts have been prepared in accordance with applicable accounting standards and under the historical cost convention, modified by the revaluation of investments.


Impairment of asset values

Fixed assets are reviewed for impairment if events or changes in circumstances indicate that the carrying amount may not be recoverable or as otherwise required by relevant accounting standards. 


Shortfalls between the carrying value of fixed assets and their recoverable amounts, being the higher of net realisable value and value-in-use, are recognised as impairments. Impairments of revalued assets, except those caused by a clear consumption of economic benefit, are recognised in the statement of total recognised gains and losses until the carrying amount reaches depreciated historic cost. All other impairment losses are recognised in the profit and loss account 


Financial instruments

Financial assets and financial liabilities are recognised on the company's balance sheet when the company has become a party to the contractual provisions of the instrument.

All investments are initially recognised at cost, being the fair value of the consideration given.

After initial recognition, investments that are classified as held for trading are measured at fair value. Gains or losses on investments held for trading are recognised in income. 

For investments that are actively traded in organised financial markets, fair value is determined by reference to Stock Exchange quoted bid prices at the close of business on the balance sheet date. Unlisted investments have been based on cost less impairment as there is insufficient information to enable a valuation to be performed. 


Deferred taxation

Deferred tax is recognised in respect of differences between the Company's taxable profits and its results as stated in the financial statements that have originated but not reversed at the balance sheet date.


Deferred tax assets are only recognised where there is an expectation that they will result in a reduction in corporation tax payments in the foreseeable future. 


Deferred tax is measured at the average tax rates that are expected to apply in the periods in which timing differences are expected to reverse, based on tax rates and laws that have been enacted or substantially enacted by the balance sheet date. Deferred tax is measured on a non-discounted basis. 


Foreign currency translation

Monetary assets and liabilities denominated in foreign currencies are translated into sterling at the rates of exchange ruling at the accounting date. Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. All differences are taken to profit and loss account.


Going concern

The directors have carried out cost projections for the company and compared these with the availability of finance. Based on this, the Directors have formed a judgement, at the time of approving the accounts, that there is a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. For this reason the Directors continue to adopt the going concern basis in preparing the accounts.


1.     PROFIT ON ORDINARY ACTIVITIES BEFORE TAX
2008
£’000
2007
£’000
Profit on ordinary activities before tax for the year is stated after charging/ (crediting):
 
 
 
 
 
 
 
Auditor’s remuneration - statutory audit
14
12
 
- Services relating to taxation
3
7
 
- Other services
4
7
 
Waiver of loan
-
(170)
 
 
                               
                               


2.     NET ADMINISTRATIVE EXPENSES/(INCOME)
2008
£’000
2007
£’000
 
 
 
Administrative expenses
110
77
Waiver of loan
-
(170)
 
                 
                 
 
110
(93)
 
                               
                               
  
3.     DIRECTORS
 
2008
Number
2007
Number
Number of employees
The average monthly number of employees, including directors, during the year was:
2
2
 
                               
                               
 
£’000
£’000
Directors’ emoluments
            Aggregate emoluments
47
12
 
                               
                               
Emoluments of highest paid director:
Remuneration
35
12
 
                               
                               



Emoluments amounting to £Nil (2007 - £35,000) have been waived by 1 director. 


4.     TAX ON PROFIT ON ORDINARY ACTIVITIES
 
2008
£’000
2007
£’000
Analysis of charge in the year:
 
 
Current tax
-
-
Deferred tax
-
-
 
                               
                               
 
-
                                -
 
                               
                               
Factors affecting tax charge for year:
            The tax assessed for the year is lower than the standard rate of corporation tax in the UK (30%). The differences are explained below:
 
 
           Profit on ordinary activities before tax
524
-
 
                               
                               
            Profit on ordinary activities multiplied by standard rate of corporation tax in the UK 30% (2007: 30%)
157
-
Expenses not deductible for tax purposes
9
-
            Tax losses utilised
(166)
-
 
                               
                               
Current tax charge for year
-
-
 
                               
                               



As at 31 March 2008 the Company had corporation tax revenue losses of approximately £5.2m (2007: £5.6m) available to carry forward against future income. No deferred tax asset is recognised in respect of these losses due to the uncertainty as to the utilisation of the losses in the foreseeable future. 


Future tax charges will be dependent on the split of profits for tax purposes as between revenue and capital items, and the utilisation of losses incurred to date.


5.    EARNINGS PER ORDINARY SHARE
 
2008
£’000
2007
£’000
Profit for the financial year
524
-
 
                               
                               
Average number of ordinary shares in issue ('000)
627,667
627,667
 
                               
                               
                Basic profit per share (pence)
0.08p
0.0p
 
                               
                               
                Fully diluted profit per share (pence)
0.08p
0.0p
 
                               
                               



The share options and warrants do not give rise to any dilution and therefore the fully diluted profit per share is equal to the basic profit per share.



6.    FINANCIAL ASSETS HELD FOR TRADING


2008

£'000

2007

£'000

                   Listed investments

3,125

75


        

        


7.    CREDITORS: amount falling due within one year


2008

£'000

2007

£'000


       Trade creditors

3,307

-

       Accruals

30

61

       Directors' loan (note 16)

15

58


        

        


3,352

119


        

        

Trade creditors and directors' loans represent the Company's financial liabilities measured at amortised cost. Due to their short term nature, carrying value approximated to fair value.

  

8.    SHARE CAPITAL 


2008

£'000

2007

£'000

                AUTHORISED

    3,000,000,000 ordinary shares of £0.001 each

3,000

3,000


        

        

    ALLOTTED, CALLED UP AND FULLY PAID



    627,667,198 ordinary shares of £0.001 each

628

628

 

        

        

9.    Share options


The Company has unapproved and approved share option schemes in which the Directors participate. Details of Directors' outstanding share options are shown below:

 
 
Exercise
Number at
Number at
 
 
Price
31 March
1 April
 
 
(per share)
2008
2007
 
 
 
 
 
Eaitisham Ahmed
 
2p
125,000,000
125,000,000
Zafarullah Karim
 
0.8p
75,000,000
75,000,000



The options remain extant, as long as their holder remains an employee of the company. All share options are exercisable at 31 March 2008.


The Market price of the Company's ordinary shares ranged from a high of 00.27p to a low of 00.06p during the year and was 00.12p on 31 March 2008. Since 31 March 2008 to the date of this report, no options have been granted or exercised.  


There have been no movement in the share options in the current or prior year. The company has not recognised a charge in respect of these options as it would not be material to the financial statements.



10.    PROFIT AND LOSS RESERVE


2008

£'000

2007

£'000

                     At 1 April 2007

(8,938)

(8,938)

                     Profit for the year

524

-


        

        

                     At 31 March 2008

(8,414)

(8,938)


        

        



11.    RECONCILIATION OF MOVEMENTS IN
         SHAREHOLDERS' FUNDS/(DEFICIT)

2008

£'000

2007

£'000

                     Opening shareholders' deficit

(40)

(40)

                     Profit for the financial year

524

-


        

        

                     Closing shareholders' funds/(deficit)

484

(40)


        

        


12.    RECONCILIATION OF OPERATING LOSS TO
         NET CASH OUTFLOW FROM OPERATING
         ACTIVITIES

2008

£'000

2007

£'000

                     Operating profit

524

-

         Gains on investment

(633)

93

                     Waiver of director's loan

-

(170)

                     Decrease in creditors

(31)

-


        

        

                     Net cash outflow from operating activities    

(140)

(77)


        

        


         13. ANALYSIS OF NET (DEBT)/ FUNDS
 
At 31 March 2007
£’000
Cash flows
£’000
At 31 March 2008
£’000
   Cash at bank and in hand
 
4
707
711
   Director’s loan
 
(58)
43
(15)
 
 
                   
                   
                   
 
 
(54)
750
696
 
 
                   
                   
                   

 

 

 

     14.   RECONCILIATION OF NET CASH FLOW TO 
       MOVEMENT IN NET FUNDS/(DEBT)
2008
£’000
2007
£’000
 
 
                   Increase/(decrease) in cash in the year
707
(39)
                   Cash inflow/(outflow) from financing activities
43
(105)
                   Non-cash movement
-
170
                   Net debt at 31 March 2007
(54)
(80)
 
                               
                               
                   Net funds/(debt) at 31 March 2008
696
(54)
 
                               
                               



15.    FINANCIAL INSTRUMENTS 


Interest rate risk


Floating rate financial liabilities of £Nil (2007: £Nil) bear interest at rates based on LIBOR plus 1-1.5%. Cash at bank earns interest at floating rates based on LIBOR.


Borrowing facilities


At the year end the company had no overdraft facility (2007: £Nil).


Currency risk


Due to the short term nature of trading in foreign currency investments, the company has limited exposure to currency risk.


Credit risk


The Directors believe that due to the nature of the Company's debtors, primarily brokers, credit risk is limited.


Liquidity risk


The Company manages liquidity risk by investing primarily in listed investments. In addition, the Chief Executive has historically provided to the Company sufficient short term funding to cover its needs. The Directors believe that these factors limit the Company's exposure to liquidity risk.


Market risk


The Company monitors its investments in listed investments on a regular basis, and takes action when it deems appropriate.


  

16.    RELATED PARTY TRANSACTIONS


During the year the Company received funding from the Chief Executive and incurred expenditure on his behalf. As at the balance sheet date, the amount advanced by the Chief Executive to the Company amounted to £14,597 (2007: £57,890). This sum is interest free and there are no fixed terms for repayment. The maximum balance that was outstanding during the year was £90,890 (2007: £176,448). 










This information is provided by RNS
The company news service from the London Stock Exchange
 
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