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Creon Corporation plc (AMED)

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Thursday 08 July, 2010

Creon Corporation plc

Audited results for the year ended 31 January 2010


For immediate release: 8 July 2010

                             Creon Corporation plc                             

              Audited results for the year ended 31 January 2010               

Creon Corporation plc (AIM: CRO) today announces its audited results for the
year ended 31 January 2010.

CHAIRMAN'S STATEMENT

I am pleased to present this annual report of Creon Corporation plc ("Creon" or
the "Company") and its subsidiaries ("the Group") to shareholders for the year
ended 31 January 2010.

Introduction

The Company was set up in 2004 as a provider of mezzanine finance to small and
medium sized UK residential property developers and successfully floated on AIM
in November 2004. During the next few years, the Company made a number of
successful loans and recorded material returns in respect of some of these. For
the year ended 31 January 2007, the Group recorded a profit of £265,295 and had
net assets in excess of £3.0 million, albeit, the vast majority of which was in
loan advances. However, the swift onset of the credit crunch in early 2007,
coupled with the general fall in property prices meant that most of the loans
that the Company had outstanding became overdue and, as a consequence of the
lack of available finance and bank tightening, all of the outstanding
residential related mezzanine loans were written off during the year ended 31
January 2009. For the year ended 31 January 2009, the Group recorded a loss of
approximately £3.7 million for the year. The loss in that financial year was so
great due, in part, to the Directors decision to provide against all of the
Group's accrued loans and fees totaling approximately £2.4 million and partly
due to the loss associated with the sale of Pinnacle Plus Limited in October
2008 of approximately £1.1 million.

Creon's Operations

During the financial year under review, the Company underwent some significant
changes. These included the need to realise assets quickly in order to repay
its own bank lending, a change in the directors and a broadening in the
Company's investment strategy, enabling it to make investments in other
businesses, as well as being able to continue to make loans. The Company's
management has continued to make assessments of suitable investment
opportunities during the year, although none have yet to come to fruition. Any
investments or loans made would require the support of the Company's
shareholders and the need to raise further equity funds.

Financial Review

Income during the year represented the rental income received by the Company
from the two residential properties that it had received in lieu of loan
repayments from an earlier mezzanine loan. Both of these properties were sold
in the summer of 2009 for their approximate carrying value of £335,000. The
Company incurred sale costs of approximately £15,000 in connection with their
sale. Administrative expenses of £152,337 (2009: £282,437) were significantly
down on the previous year, a direct reflection of the lower activity than in
2009.

At the beginning of the 2009/10 financial year, the Company made one loan of £
200,000, of which £110,000 remained outstanding at the year end, and recorded
loan interest income of £17,633 for the year. The Company's retained loss for
the year was £146,940 (2009: £3,700,267 loss) resulting in a loss per share of
0.33 pence (2009: 24.9 pence loss).

The Group ended the year with net assets of £495,775 (2009: £642,715). The
assets were primarily made up of the £400,000 investment in unquoted preference
shares that the Company invested in during the previous financial year and the
loan receivable of £110,000. Group cash at 31 January 2010 was £15,862 (2009: £
1,925). The key other changes to the Group's balance sheet was that it ended
the year with zero debt (2009: £250,000 bank loan) and with only £58,036 of
trade and other payables outstanding (2009: £104,615). There were no changes in
the Company's share capital during the year under review.

The £110,000 of loan receivable ("Loan") has been, and is to continue to be,
used by the Company to pay the ongoing running costs associated with being a
public company until suitable investments have been indentified and further
equity funds raised. The Loan can be called by the Company at any time up until
its repayment date of 31 July 2011. The Directors estimate that the total
annual running costs of the Company are approximately £90,000 and therefore the
Loan and its repayment (including interest due) provides the Directors with
sufficient comfort as to the Group's ability to meet its ongoing obligations as
they fall due for at least the next 12 months.

Investment Policy

The Board remains committed to continue to provide mezzanine finance that can
provide a suitable return with an acceptable risk profile when the market for
such finance returns. However, the Board believes that it is in the best
interests of shareholders to broaden Creon's investment strategy to enable the
Group to provide finance to, and make investments in, other industry sectors
rather than being confined to the UK property sector. The Directors will be
seeking approval of, inter alia, the broader investment policy as set out below
at the Annual General Meeting of shareholders, which is to be held on 30 July
2010.

The Group will broaden its investment policy to also include investments in
private companies, publicly quoted companies and partnerships. The Group will
not focus on any particular industry sector but will seek investments in
sectors where there is potential for suitable returns. This is expected to
include sectors such as financial services and property, where values largely
remain subdued. The Company will primarily focus on European based businesses
but will also consider investments in other geographical areas if appropriate.
The Group will not seek to limit the size of the investment or the size of the
entities in which it invests.

The Group will not be limited to a fixed number of investments or seek to
diversify the investments over particular sectors or particular indexes,
however it is envisaged that the total number of investments at any given time
will not exceed 50 investments. The Group does not envisage at this stage
gearing its investments but may consider doing so in the future. The Board is
currently reviewing a number of investment opportunities and anticipates making
an investment during the course of next year.

The Company will generally be a passive investor in the entities in which it
invests but if the Board or the Group's consultants are able to add value to
the investee entities then the Group may take a more activist stance.

The Group plans to identify its non-property related investments through the
extensive network of contacts of the Board and the Group's financial advisers
and consultants. Once potential investments have been identified, the Board
will evaluate them on the basis of research prepared and presented to the Board
by its financial advisers and consultants. The Board believes that this
investment policy will help maintain the Group's low cost base whilst having
the potential to deliver improved returns for shareholders.

Director changes

The Company is pleased to welcome Robert Albertus Franscisco Eijkelhof onto the
Board of the Company as a non-executive director with immediate effect. Robert,
aged 48, is an experienced non-executive director which will be important in
evaluating the proposed broadened investment strategy. Robert currently runs
Recoin Capital Trading Services, a financial services consultancy firm. Robert
does not have a shareholding in Creon and there is no further information
required to be disclosed under Schedule 2, Paragraph (g) of the AIM Rules for
Companies, pursuant to Robert's appointment.

Robert will be replacing Jonathan Freeman on the Company's board as Jonathan
has today tendered his resignation from the board of the Company to take effect
immediately after the 2010 annual general meeting. The board of Creon would
like to wish Jonathan all the very best for the future and to record its thanks
for his effort and commitment to the Company over the last five years since its
flotation in 2004.

Annual General Meeting

You will find set out at the end of this document a notice convening an Annual
General Meeting of the Company ("AGM") to be held at its registered office,
being 11 Grosvenor Crescent, Belgravia, London SW1X 7EE at 11.00 a.m. on 30
July 2010 which includes, inter alia, the following resolutions:

  * Directors' powers to allot securities;
   
  * Directors' powers to disapply pre-emption rights;
   
  * Approving the Group's ongoing Investment Strategy;
   
  * Receiving of the accounts;
   
  * Appointment of Robert Eijkelhof as a director of the Company;
   
  * Re-appointment of Guus Berting, who retires by rotation, as a director of
    the Company; and
   
  * Re-appointment of the Company's auditor
   
The notice of AGM, together with a form of proxy for use at the AGM, has today
been sent to shareholders.

Current position and outlook

Overall trading conditions continue to be challenging across the wider economy
and the renewed fears of a double-dip recession mean that confidence levels of
an imminent upswing amongst investors remain low. However the Directors and
their advisers are continuing to assess investment projects that appear to
demonstrate significant return opportunities and are hopeful of being able to
complete on one of these transactions during the course of the current
financial year. Any transaction would require the need to raise further equity
for investment from existing and potentially new shareholders.

CREON CORPORATION PLC

GROUP STATEMENT OF COMPREHENSIVE INCOME

for the year ended 31 January 2010

                                                          2010             2009
                                                                               
                                          Note               £                £
                                                                               
Revenue                                     2            4,138            9,275
                                                                               
Cost of sales                                         (14,559)           16,172
                                                                               
Exceptional item: loans impairment                           -      (2,328,493)
                                                                               
                                                        _______        _________
                                                                               
Gross profit                                          (10,421)      (2,303,046)
                                                                               
Administrative expenses                     3        (152,337)        (282,437)
                                                                               
Exceptional item: profit/(loss) on sale                     47      (1,100,034)
of investment                                                                  
                                                                               
                                                      ________        _________
                                                                               
Loss from operations                                 (162,711)      (3,685,517)
                                                                               
Finance income                              5           17,633            4,635
                                                                               
Finance costs                               5          (1,862)         (18,634)
                                                                               
                                                      ________        _________
                                                                               
Loss on ordinary activities before                   (146,940)      (3,699,516)
taxation                                                                       
                                                                               
Taxation                                    6                -            (751)
                                                                               
                                                      ________        _________
                                                                               
Retained loss for the year                           (146,940)      (3,700,267)
                                                                               
Basic and diluted loss per share            7          (0.33)p          (24.9)p

All of the Group's activities are classed as continuing and there were no
recognised gains or losses in either year other than those included above.

The Company has elected to take exemption under section 408 of the Companies
Act 2006 from presenting the Company statement of comprehensive income. The
loss for the Company for the year was £241,496 (2009: £3,611,397).

STATEMENTS OF CHANGES IN EQUITY

Group

                          Share     Share premium    Retained       Total equity
                        capital           account     earnings   attributable to
                                                               equity holders of
                                                                          parent
                                                                                
                              £                 £            £                 £
                                                                                
At 1 February 2008      100,361         2,774,949       87,190         2,926,500
                                                                                
Issue of shares         339,543         1,040,939            -         1,380,482
                                                             
Loss for the year             -                 -     (3,700,267)     (3,700,267)
                         ______          ________     _________      _________
                                                                                 
At 31 January 2009      439,904         3,815,888   (3,613,077)         642,715
                                                                                
Loss for the year             -                 -    (146,940)         (146,940)
                                                                                
                         ______          ________    _________          ________
                                                                                
At 31 January 2010      439,904         3,815,888  (3,760,017)           495,775
                                                                                
                         ______          ________    _________          ________

Company

                            Share  Share premium     Retained      Total equity
                          capital        account     earnings   attributable to
                                                              equity holders of
                                                                         parent
                                                                               
                                £              £            £                 £
                                                                               
At 1 February 2008        100,361      2,774,949       87,190         2,962,500
                                                                               
Issue of shares           339,543      1,040,939            -         1,380,482
                                                                               
Loss for the year               -              -  (3,611,397)       (3,611,397)
                                                                               
                           ______       ________    _________          ________
                                                                               
At 31 January 2009        439,904      3,815,888  (3,524,207)           731,585
                                                                               
Loss for the year               -              -    (241,496)         (241,496)
                                                                               
                           ______       ________    _________          ________
                                                                               
At 31 January 2010        439,904      3,815,888  (3,765,703)           490,089
                                                                               
                           ______       ________    _________          ________

STATEMENTS OF FINANCIAL POSITION

as at 31 January 2010

                                               Group                    Company                
                                                                                  
Assets                     Note           2010        2009        2010        2009
                                                                                  
Non-current assets                           £           £           £           £
                                                                                  
Investment property         8                -     335,000           -           -
                                                                                  
Amounts owed by             9                -           -           -     443,021
subsidiaries                                                                      
                                                                                  
Investment in subsidiaries  10               -           -           4           6
                                                                                  
Investment in unquoted      11         400,000     400,000     400,000     400,000
preference shares                                                                 
                                                                                  
                                        ______      ______      ______      ______
                                                                                  
                                       400,000     735,000     400,004     843,027
                                                                                  
                                        ______      ______      ______      ______
                                                                                  
Current assets                                                                    
                                                                                  
Loan receivables            4          110,000           -     110,000           -
                                                                                  
Investments in quoted       12           5,690      19,151           -           -
shares                                                                            
                                                                                  
Other receivables           13          22,259     241,254      22,259     241,254
                                                                                  
Cash and cash equivalents               15,862       1,925      15,862       1,925
                                                                                  
                                        ______      ______      ______      ______
                                                                                  
                                       153,811     262,330     148,121     243,179
                                                                                  
Total assets                           553,811     997,330     548,125   1,086,206
                                                                                  
Liabilities                                                                       
                                                                                  
Current liabilities                                                               
                                                                                  
Trade and other payables    14        (58,036)   (104,615)    (58,036)   (104,621)
                                                                                  
Interest bearing loan       15               -   (250,000)           -   (250,000)
                                                                                  
                                      ________    ________    ________    ________
                                                                                  
Total liabilities                     (58,036)   (354,615)    (58,036)   (354,621)
                                                                                  
                                      ________    ________    ________    ________
                                                                                
Net assets                             495,775     642,715     490,089     731,585
                                                                                  
Equity                                                                            
                                                                                  
Called up share capital     16         439,904     439,904     439,904     439,904
                                                                                  
Share premium account                3,815,888   3,815,888   3,815,888   3,815,888
                                                                                  
Retained earnings                  (3,760,017) (3,613,077) (3,765,703) (3,524,207)
                                                                                  
                                       _______     _______     _______    ________
                                                                                  
Total equity                           495,775     642,715     490,089     731,585

STATEMENTS OF CASH FLOWS

                                                Group                Company        
                                                                                 
                                Note      2010        2009       2010        2009
                                                                                 
                                             £           £          £           £
                                                                                 
Reconciliation of operating                                                      
profit to net cash flow from                                                     
operating activities                                                             
                                                                                 
Loss for the year before tax           (146,940) (3,699,516)  (241,496) (3,610,646)
                                                                                 
Adjustments for:                                                                 
                                                                                 
Finance cost                             1,862      18,634      1,862      18,634
                                                                                 
Finance income                        (17,633)     (4,635)   (17,633)     (4,635)
                                                                                 
(Profit)/loss on disposal of              (47)   1,100,034          -   1,100,034
investment                                                                       
                                                                                 
Impairment of properties                     -      65,000          -           -
                                                                                 
Impairment of investment                13,461      23,870          2           -
                                                                                 
Loans impairment                             -   2,230,907          -   2,230,907
                                                                                 
Property accepted in lieu of                 -   (400,000)          -   (400,000)
cash settlement                                                                  
                                                                                 
Change in receivables                  218,995     139,361    218,995     139,361
                                                                                 
Change in payables                    (46,579)    (30,581)   (46,585)    (30,581)
                                                                                 
Change in loans to subsidiaries              -           -    443,021    (43,021)
                                                                                 
                                       _______     _______    _______     _______
                                                                                 
Cash flows from operating               23,119   (556,926)    358,166   (599,947)
activities                                                                       
                                                                                 
Interest received                       17,633       4,635     17,633       4,635
                                                                                 
Taxation refunded/(paid)                     -      33,191          -      33,191
                                                                                 
                                        ______      ______     ______      ______
                                                                                 
Net cash from operating                 17,633      37,826     17,633      37,826
activities                                                                       
                                                                                 
Investing activities                                                             
                                                                                 
Purchase of investments                      -    (43,021)          -           -
                                                                                 
Purchase costs of acquisition    17          -   (105,187)          -   (105,187)
of Pinnacle                                                                      
                                                                                 
Loans made net of repayments         (110,000)   (403,500)  (110,000)   (403,500)
                                                                                 
Interest paid                          (1,862)    (18,634)    (1,862)    (18,634)
                                                                                 
                                       _______     _______    _______     _______
                                                                                 
Net cash used in investing           (111,862)   (570,342)  (111,862)   (527,321)
activities                                                                       
                                                                                 
Financing activities                                                             
                                                                                 
Issue of ordinary shares                     -     359,618          -     359,618
                                                                                 
(Repayment of)/proceeds from         (250,000)     250,000  (250,000)     250,000
bank borrowings                                                                  
                                                                                 
Sale of investment properties          335,047           -          -           -
                                                                                 
                                       _______     _______    _______     _______
                                                                                 
Net cash from financing                 85,047     609,618  (250,000)     609,618
activities                                                                       
                                                                                 
Net increase/(decrease) in cash         13,937   (479,824)     13,937   (479,824)
and equivalents                                                                  
                                                                                 
Cash and equivalents at                  1,925     481,749      1,925     481,749
beginning of year                                                                
                                                                                 
Cash and equivalents at end of          15,862       1,925     15,862       1,925
year                                                                             

NOTES TO THE FINANCIAL STATEMENTS

1. Accounting policies

The principal accounting policies are summarised below. They have all been
applied consistently throughout the year and the preceding year unless stated.

Basis of accounting

The financial statements of the Group and the Company have been prepared in
accordance with International Financial Reporting Standards, International
Accounting Standards and Interpretations (collectively IFRS) issued by the
International Accounting Standards Board (IASB) as adopted by European Union.

The financial statements have been prepared on the historical cost basis,
except where IFRS requires an alternative treatment. The principal variations
from historical cost relate to financial instruments (IAS 39).

At the date of authorisation of the financial statements there were Standards
and Interpretations, which have not been applied in the financial information,
that were in issue but not yet effective. The Directors anticipate that the
adoption of these Standards and Interpretations in future periods will have no
material impact on the financial statements of the Group or the Company, except
for additional disclosures when the relevant Standards and Interpretations come
into effect.

Going concern

The Directors have reviewed the current budgets and cash flow projections for a
period of more than 12 months from the date of this report. The forecasts take
into account the current cash balances and assume repayment of the outstanding
short-term mezzanine loan of £110,000 outstanding at 31 January 2010 due to be
repaid in July 2011.

Various sources of additional financing have been considered by the board to
strengthen the balance sheet, including injecting additional fresh equity,
although a final decision regarding the source of financing has not yet been
made.

Accordingly the Directors have prepared the financial statements on the going
concern basis.     

Basis of consolidation

Where the Company has the power, either directly or indirectly, to govern the
financial and operating policies of another entity or business so as to obtain
benefits from its activities, it is classified as a subsidiary. The
consolidated financial statements present the results of the Company and its
two active subsidiary undertakings, Creon Investments Limited ("Investments")
and Creon Estates Limited ("Estates") ("the group") as if they formed a single
entity. Intercompany transactions and balances between group companies are
therefore eliminated in full.

Revenue

Turnover represents arrangement fees due in respect of mezzanine finance
advances and additional fees arising from the extension of loans beyond their
original repayment date. These are spread on a straight-line basis over the
loan terms.

Rental income

Rent income is spread on a straight-line basis over the period of the lease.

Investment property

The Group applies the fair value model in accounting for investment property.
The Group's investment property was revalued annually to open market value,
with changes in the carrying value recognised in the consolidated statement of
comprehensive income. The Group's investment property was sold during the year
under revew.

Investments in subsidiaries

Investment in subsidiary companies is stated at cost less provision for any
impairment in value. Subsequent measurement of all investments is at fair
value.

Investments in unquoted and quoted shares

Investments in unquoted and quoted shares are initially measured at cost,
including transaction costs. Subsequent measurement of all investments is at
fair value. The fair values of listed investments are based on bid prices at
the financial year end date.

Assets held by the Group at the year end include unlisted redeemable preference
shares and listed investments received in lieu of repayment of a mezzanine
loan.

When managing its investments, the Group aims to profit from changes in the
fair value of equity investments. Accordingly, all quoted equity investments
are designated as "at fair value through the profit and loss" and are
subsequently recorded in the statement of financial position at fair value.

Loans receivable

Loans receivable are valued at nominal amount less provisions against
recoverability. The maximum exposure of the Company in respect of the loan
portfolio at the year end is the amount receivable shown in note 4. No hedging
transactions have been entered into with respect to the loan portfolio.

Impairment

At each financial year end date, the Group reviews the carrying amounts of its
property and equipment and intangible assets with finite lives to determine
whether there is any indication that those assets have suffered an impairment
loss. In any such indication exists, the recoverable amounts of the asset is
estimated in order to determine the extent of the impairment loss. Where it is
not possible to estimate the recoverable amount of the individual asset, the
Group estimates that recoverable amount of the cash-generating unit to which
the asset belongs.

Cash

Cash and cash equivalents comprise cash at bank and in hand.

Financial liabilities and equity

Financial liabilities and equity are classified according to the substance of
the financial instrument's contractual obligations rather than the financial
instrument's legal form. An equity instrument is any contract that evidences a
residual interest in the assets of the Group after deducting all of its
liabilities.

Trade payables

Trade payables are not interest bearing and are stated at their nominal value.

Equity instruments

Equity instruments issued by the Company are recorded at the proceeds received,
net of direct issue costs.

Current and deferred tax

The charge for current tax is based on the results for the year as adjusted for
items which are non-assessable or disallowed. It is calculated using rates that
have been enacted or substantively enacted by the financial year end date.

2. Revenue

Revenue in the year ended 31 January 2010 represents rental income received by
Creon Estates Ltd from two investment properties, both of which were sold
during the year under review.

3. Administrative expenses

Expenses included in administrative expenses (net) are analysed below

                                                        2010           2009
                                                                           
                                                           £              £
                                                                           
Premises costs                                             -         10,543
                                                                           
Administration costs                                  38,442         54,262
                                                                           
Other legal, professional and financial               64,670         87,933
costs                                                                      
                                                                           
Employment costs and directors fees                   35,764         40,799
                                                                           
Impairment of assets                                  13,461         88,870
                                                                           
Sundry                                                     -             30
                                                                           
                                                      ______         ______
                                                                           
                                                     152,337        282,437
                                                                           
                                                      ______         ______

The auditor's fees in the year ended 31 January 2010 were £14,000

4. Loans impairment

                                                         2010            2009
                                                                             
                                                            £               £
                                                                             
Balance brought forward                                     -       2,230,907
                                                                             
New loans advanced in the year                        200,000         282,881
                                                                             
Loans repaid                                         (90,000)       (165,017)
                                                                             
Property accepted in lieu of cash settlement                -       (400,000)
                                                                             
Loans written off                                           -     (1,948,771)
                                                                             
                                                       ______          ______
                                                                             
Balance carried forward                               110,000               -
                                                                             
                                                       ______          ______

As at 8 July 2010, the amount of the new loan advanced in the year that
remained receivable by the Company had been reduced to £97,500 through
repayments in accordance with the terms of the loan.

5. Finance income and finance costs

                                                         2010            2009
                                                                             
                                                            £               £
                                                                             
Finance income - interest income on                         -           4,635
short-term deposits                                                          
                                                                             
- interest income on commercial loan                   17,633               -
                                                                             
                                                        _____           _____
                                                                             
                                                       17,633           4,635
                                                                             
                                                        _____           _____
                                                                             
Finance costs - Interest expense on bank loan           1,862          18,634
                                                                             
                                                        _____           _____

6. Taxation

                                                        2010           2009
                                                                           
                                                           £              £
                                                                           
UK Corporation tax                                                         
                                                                           
Current tax on loss for the year                           -              -
                                                                           
Underprovision in prior year                               -            751
                                                                           
                                                      ______        _______
                                                                           
                                                           -            751
                                                                           
                                                      ______        _______
                                                                           
Factors affecting tax charge in the year                                   
                                                                           
Loss on ordinary activities before tax             (146,940)    (3,700,267)
                                                                           
Loss on ordinary activities at the effective        (30,857)      (746,220)
rate of corporation tax in the UK of 21%                                   
(2009: 20.17%)                                                             
                                                                           
Unrelieved losses                                     30,857        746,220
                                                                           
Underprovision in prior year                               -            751
                                                                           
                                                      ______        _______
                                                                           
Tax charge for the year                                    -            751
                                                                           
                                                      ______        _______

7. Loss per share

The basic and diluted loss per share for the year ended 31 January 2010 was
0.33p. The calculation of loss per share is based on the loss of £146,940 for
the year ended 31 January 2010 and the number of shares in issue during the
year of 43,990,400. No options or warrants remain outstanding as of 31 January
2010 and no further shares have been issued since 31 January 2010.

The basic and diluted loss per share for the period to 31 January 2009 was
24.9p. The calculation of loss per share for that period was based on loss of £
3,700,267 for the year to 31 January 2009 and the weighted average number of
shares in issue during the year of 14,852,682. The Company issued 33,954,435
new ordinary shares during the year ended 31 January 2009.

8. Investment property

Freehold                                                 2010            2009
                                                                             
Cost or valuation                                           £               £
                                                                             
At 1 February                                         335,000               -
                                                                             
Additions                                                   -         400,000
                                                                             
(Deficit) on revaluation                                    -        (65,000)
                                                                             
Disposals                                           (335,000)               -
                                                                             
                                                      _______         _______
                                                                             
At 31 January                                               -         335,000
                                                                             
                                                      _______         _______

Both investment properties held were let on assured short-term tenancies for
the first part of the year under review until their disposals were completed in
August 2009 and September 2009.

9. Amounts owed by subsidiaries

                                                             Company           
                                                                               
                                                       2010                2009
                                                                               
                                                          £                   £
                                                                               
Creon Estates Limited                                     -             400,000
                                                                               
Creon Investments Limited                                 -              43,021
                                                                               
                                                     ______             _______
                                                                               
                                                          -             443,021
                                                                               
                                                     ______             _______

Amounts owed to the Company from its wholly owned subsidiaries, Creon Estates
Limited and Creon Investments Limited were provided for in full at 31 January
2010.

10. Investment in subsidiaries

                                                            Company            
                                                                               
                                                      2010                 2009
                                                                               
Cost or valuation                                        £                    £
                                                                               
At 1 February                                            6                     
                                                                               
Additions                                                -              776,942
                                                                               
Disposals                                              (2)            (776,936)
                                                                               
                                                   _______              _______
                                                                               
At 31 January                                            4                    6
                                                                               
                                                   _______              _______

Creon's subsidiaries, all of which have been included in these consolidated
financial statements, were as follows:

Name                      Country of       Proportion of ownership interest at 
                        incorporation                   31 January             
                                                                               
                                                  2010              2009       
                                                                               
Creon Investments          England                100%              100%       
Ltd                                                                            
                                                                               
Creon Estates Ltd          England                100%              100%       
                                                                               
Creon Properties           England                100%              100%       
Ltd                                                                            

The principal activity of Creon Investments Ltd is that of making
non-controlling investments in quoted and unquoted companies. Creon Estates
Ltd's principal activity was that of holding residential property for resale.
Creon Properties Ltd was dormant and was dissolved on 24 April 2010.

11. Investment in unquoted preference shares

                                                         Group and Company     
                                                                               
                                                           2010            2009
                                                                               
Cost or valuation                                             £               £
                                                                               
At 1 February                                           400,000               -
                                                                               
Additions                                                     -         400,000
                                                                               
                                                        _______         _______
                                                                               
At 31 January                                           400,000         400,000
                                                                               
                                                        _______         _______

The investment in unquoted preference shares represents 400,000 £1 non-voting
redeemable preference share held in Pinnacle Plus Limited. The preference
shares accrue interest at a rate of 7.0 per cent. per annum, payable on the
date of redemption, with redemption being at Pinnacle's discretion at any time
up to September 2013, upon which date the preference shares will be
automatically redeemed.

12. Investments in quoted shares

                                                               Group           
                                                                               
                                                          2010             2009
                                                                               
Cost or valuation                                            £                £
                                                                               
At 1 February                                           19,151                -
                                                                               
Additions                                                    -           43,021
                                                                               
Impairment provision                                  (13,461)         (23,870)
                                                                               
                                                          ____            _____
                                                                               
At 31 January                                            5,690           19,151

13. Other receivables

                                                        Group & Company        
                                                                               
                                                           2010            2009
                                                                               
                                                              £               £
                                                                               
Proceeds due from exercise of share warrants                  -         232,299
                                                                               
Prepayments and sundry debtors                            8,923           8,955
                                                                               
Accrued income and interest                              13,336               -
                                                                               
                                                          _____          ______
                                                                               
                                                         22,259         241,254

All amounts fall due for payment within one year.

14. Trade and other payables

                                                             Group             
                                                                               
                                                           2010            2009
                                                                               
                                                              £               £
                                                                               
Accruals and deferred income                             58,036         104,615
                                                                               
                                                          _____          ______
                                                                               
                                                         58.036         104,615
                                                                               
                                                            Company            
                                                                               
                                                           2010            2009
                                                                               
                                                              £               £
                                                                               
Accruals and deferred income                             58,036         104,621
                                                                               
                                                          _____          ______
                                                                               
                                                         58.036         104,621

15. Interest bearing loan

As at 31 January 2009, the Company had a £250,000 fixed bank loan secured
against the Company's assets and charged at base rate plus 2%. Repayment was
made in September 2009 following the sale of the investment properties.

16. Share capital

                                                           2010            2009
                                                                               
                                                              £               £
                                                                               
Authorised                                                                     
                                                                               
100,000,000 ordinary shares of 1p each                1,000,000       1.000,000
                                                                               
Allotted, called up and fully paid                                             
                                                                               
43,990,545 ordinary shares of 1p each                   439,904         439,904

No warrants or options were issued during the financial year or remained
outstanding for exercise post 31 January 2010.

17. Asset value per share

The net asset value per share at 31 January 2010 was £0.01 (31 January 2009; £
0.01). Net asset value is based on the net assets as at 31 January 2010 of £
495,775 (31 January 2009: £642,715) and on the number of Ordinary Shares in
issue at 31 January 2010 being 43,990,545 Ordinary Shares (31 January 2009:
43,990,545).

18. Staff numbers and costs

The average monthly number of employees of the Group, including directors,
during the year was 2 (2009: 2). The aggregate remuneration and associated
costs were:

                                                         2010           2009
                                                                            
                                                            £              £
                                                                            
Wages and salaries                                      3,000         12,000
                                                                            
Social security costs                                     204            681
                                                                            
                                                        _____          _____
                                                                            
                                                        3,204         12,681

Directors' emoluments

                                                         2010            2009
                                                                             
                                                            £               £
                                                                             
Amounts paid to third parties in respect of            61,982          52,828
directors' services including expense                                        
                                                                             
Emoluments paid to a director                           3,000          12,000
                                                                             
                                                        _____           _____
                                                                             
                                                       64,982          64,828

19. Capital commitments

There were no capital commitments at the year end (2009 - £nil).

20. Related party transactions

The following information discloses the significant related-party transactions
during the year

Name of related party and nature of   Transaction  Amount paid     Balance    
relation                                 type                   outstanding at
                                                                   year end   
                                                                              
                                                    2010   2009    2010   2009
                                                                              
                                                       £      £       £      £
                                                                              
Jonathan Freeman, director of Creon    Directors  16,950 15,463   5,640 13,160
is a 50% shareholder of Combined         fees                                 
Management Services Limited ("CMS")                                           
                                                                              
Jonathan Freeman, director of Creon     Admin &   16,920 15,526   5,640 13,160
is a 50% shareholder of CMS             support                               
                                       services                               
                                                                              
Jonathan Freeman, director of Creon   Accountancy 15,000 16,113   5,000 15,630
is a 50% shareholder of CMS            services                               
                                                                              
Jonathan Freeman, director of Creon    Provision       -  9,400       -  3,493
is a 50% shareholder of CMS            of Office                              
                                         space                                

Jonathan Freeman is a director of Syndicate Asset Management Plc, a company in
which the Group has an investment valued at £5,690 at 31 January 2010 (2009: £
19,151). In addition, Guus Berting is a non-executive director of Pasha
Investments V B.V. ("Pasha"), a business to whom the Company made a loan
("Loan") during the year and which £110,000 remained outstanding as at 31
January 2010. As at 8 July 2010, the balance outstanding on the Loan was £
97,500 which is due to be repaid to the Company on or before 30 July 2011,
together with interest due thereon.

Related party balances outstanding at the year end attract zero interest and
are payable on demand.

21. Analysis of cash and cash equivalents

                                                            2010           2009
                                                                               
                                                               £              £
                                                                               
Cash at bank and in hand                                  15,862          1,925
                                                                               
Interest bearing loan                                          -      (250,000)
                                                                               
                                                         _______         ______
                                                                               
                                                          15,862      (248,075)

The Company's Report and Accounts for the year ended 31 January 2010 will be
posted to shareholders today and the full report is available to view and
download from the Company's website at www.creoncorporation.com.

For further information please contact:

Creon Corporation Plc Guus Berting +44 (0)20 7752 0215

Daniel Stewart & Company Plc Oliver Rigby +44 (0)207 776 6550

GTH Media Relations Toby Hall +44 (0)20 3 103 3903

Christian Pickel +44 (0)20 3 103 3902


                                                                                      

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