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Wey Education PLC (WEY)

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Friday 31 May, 2013

Wey Education PLC

Final Results

RNS Number : 9451F
Wey Education PLC
31 May 2013
 



WEY EDUCATION PLC

("Wey Education" or the "Company")

 

PRELIMINARY ANNOUNCEMENT OF UNAUDITED RESULTS

FOR THE YEAR ENDED 31 DECEMBER 2012

 

 

 

2012 was a somewhat tumultuous year for your Company but as you will see below, your Board believes that we are now in a better position than we were this time last year and there is a good prospect that we can make progress in the development of our education business. 

 

The detailed financial results are contained within the financial statements below, in summary, the Group generated a loss of £455,686 (2011 - £388,543) on revenue of £240,153 (2011 ‑ £121,282).  This represents a loss per share, both basic and diluted, of 3.29p (2011 ‑ 3.36p).  However, the Company was in development phase throughout the period and these historic results are of limited value in judging the prospects of the Group going forward.   Following the changes of personnel referred to below, the Board considered the carrying value of its investment in Zail Enterprises Limited and as a result of the review decided it had been impaired and wrote off the goodwill associated with such and this is reflected in the results, with a charge of £76,400.

 

During the early part of 2012, the Company failed to achieve the targets in terms of developing its schools management business that had been expected and responded by implementing a number of changes.  Christine Whatford, Lynette Lackey and Garry Watson all left the Board in August 2012 and myself, Zenna Atkins (the CEO) and the remaining Non-Executive Director, John Molyneux, were joined by John Bridges and David Massie as additional Directors.  Mr Massie had been the original founder of Wey, prior to its acquisition of Zail Enterprises Limited in March 2011 and remains a substantial shareholder.  He had indicated to the Board his dissatisfaction with the progress being made and his desire to take a closer interest in the business.  

 

During the summer of 2012, the Company's wholly owned subsidiary, Zail Enterprises Limited, became an Approved Sponsor under the Department for Education's Academy and Free Schools Programme and this was announced to shareholders.  Following the changes to the Board, the new Directors initiated a review of the Company's operations, cash flows and history and as a result, it was identified that the Company had also prematurely announced an expected contract win for which there was no supporting evidence and which did not progress.  A correcting announcement was therefore made to shareholders on 29 October 2012.  

 

Due to the delays in developing the Company's business, it was apparent that it needed further funding and, as neither the markets nor the Company's then stage of development were judged to be sufficient  to attract outside investment, Mr Massie agreed to make a loan facility available through one of his business interests and the Company agreed a facility for a loan of £150,000.

 



 

Zenna Atkins chose to tender her resignation on 24 October 2012 and indicated that she was prepared to work her notice period.  During her notice period certain matters came to the attention of the Board which resulted in Ms Atkins being suspended from her duties on 6 December 2012, pending investigation of these.  A report regarding certain irregularities was submitted to Ms Atkins on 17 January 2013 and she was asked to attend a Disciplinary Hearing at the Company's offices on 24 January 2013.  On 22 January 2013, Ms Atkins announced that she was leaving the Company's employment with immediate effect and she therefore did not attend the Disciplinary Hearing. 

 

Recently, Ms Atkins has started an action against the Company at an Employment Tribunal, alleging constructive dismissal.  The time limit for the Company to file its response has not yet expired and the Company intends to vigorously defend the action and is considering what other options it may have open to it in relation to Ms Atkins' previous conduct.  Its consideration of this matter is being delayed as it appears that every email Ms Atkins had either received or sent during her period of employment with the Company, including all correspondence with the Company's customers and consultants, has been destroyed.

 

The initial concept for the Group's development as an education business had begun with the employment of Ms Atkins and the acquisition of her company, Zail Enterprises Limited, in March 2011 for a consideration of £75,000 paid entirely in shares.  Ms Atkins was entitled to further consideration based upon the results of the Group; as a consequence of her leaving our employment, the right to any deferred consideration has now lapsed. 

 

Since her departure, the Company has significantly reduced its overheads, whilst seeking to re-establish its relationship with various interested parties.   While success has been achieved in maintaining a steady flow of consultancy business, it is recognised that this alone is not sufficient to generate long term profitability and a return to shareholders.   Long term success relies upon the Company progressing its school management model.  In that regard, the Department for Education has confirmed that Zail Enterprises Limited maintains its Approved Sponsor status and during last year, the Company established a specialist vehicle, as a company limited by guarantee, which will be the operator of record of any Academies which come under management.  The board of this vehicle, to be called "Wey Education Schools Trust", will be strengthened with independent appointments in due course.  In addition to Academies and proposer led Free Schools, we are now also able to bid for Local Authority new schools and continue to develop our relationship with the Department for Education and, in particular, the Office of the Schools Commission.  We are working with each of  them to identify schools that could come into our Group, with the ambition of opening our first Academy in early 2014.

 

Whilst it is too early to provide reassurance that the Company will ultimately achieve its ambitions, we now have a clear path and the new management and your Board is committed to establishing a business capable of making a return to shareholders.

 

 

 

 



 

WEY EDUCATION PLC

 

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

 

31 DECEMBER 2012

 

 


2012

£

 


2011

£

 

REVENUE

240,153


121,282

 

Equity settled share based payments


-


(89,761)

Administrative expenses

(619,439)


(420,187)

Exceptional item - goodwill write-off

(76,400)


-



--------------------------


------------------------------

OPERATING LOSS


(455,686)


(388,666)





Finance income

-


123






--------------------------


--------------------------

LOSS BEFORE TAXATION

(455,686)


(388,543)

 

Taxation


-


-






--------------------------


--------------------------

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

(455,686)


(388,543)


========================= =


==========================

 

 

Basic loss per share


(3.29p)


(3.36p)

Diluted loss per share


(3.29p)


(3.36p)


========================= =


==========================

 

All of the activities of the group are classed as continuing.

 

The  group has no recognised gains or losses other than the results for the year as set out above.

 

 



 

WEY EDUCATION PLC

 

STATEMENT OF FINANCIAL POSITION

 

31 DECEMBER 2012

 

 



At 31 December

2012


At 31 December

2011



£

£


£

£

ASSETS














Non current assets







Intangible asset


-



76,400


Property, plant & equipment


5,143



8,828












5,143



85,228

Current assets







Trade & other receivables


85,115



50,300


Cash & cash equivalents


42,944



318,429












128,059



368,729








TOTAL ASSETS



133,202



453,957








EQUITY AND LIABILITIES












Equity and reserves







Ordinary shares



138,652



138,652

Share premium account



559,538



559,538

Option reserve



38,205



89,761

Retained earnings



(799,213)



(395,083)








TOTAL EQUITY AND RESERVES

(62,818)



392,868















Current liabilities







Trade and other payables



196,020



61,089















TOTAL EQUITY & LIABILITIES

133,202



453,957








 



 

WEY EDUCATION PLC

 

NOTES TO THE RESULTS FOR THE YEAR ENDED

 

31 DECEMBER 2012

 

 

1.       The financial information set out above does not constitute statutory accounts for the purpose of the Companies Act.  These financial statements have not been reviewed or approved by the Group's auditor. 

 

 

For further information contact:

 

Wey Education Plc



David Massie (Company Secretary)


Tel:    +44 (0) 20 7518 9700

Christopher Phillips


Tel:    +44 (0) 20 7534 1888




WH Ireland Limited  



John Wakefield


Tel:    +44 (0) 117 945 3470




 

THE DIRECTORS OF THE COMPANY ACCEPT RESPONSIBILITY FOR THE CONTENTS OF THIS ANNOUNCEMENT.

 

 


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