|
St Helen’s Capital Plc, an independent institutional stockbroker and corporate finance adviser focused on companies in the small cap sector, announces its audited results for the year ended 31st March 2008.
CHAIRMAN’S STATEMENT
St Helen’s Capital (‘St Helen’s’) has made good progress in its stated objective of becoming a leading small-cap focused institutional stockbroker and financial adviser albeit against a backdrop of deteriorating markets for smaller companies. In particular, the Company is successfully developing a full range of institutional broking services to small-cap AIM listed corporate clients and positioning itself for when the markets recover.
In order to achieve this, St Helen’s has made a number of key appointments across the Corporate, Research and Broking functions and these additional professionals have integrated well with the existing team.
St Helen’s had 15 AIM brokerage clients as at the end of July 2008, from a standing start in March 2007, including Kurawood Plc, the Company’s first AIM IPO. St Helen’s Capital aims to grow this number of clients substantially over the coming months, capitalising on the need for quality research and brokerage services to the small-cap market.
In addition, an encouraging pipeline of business is building up and we anticipate that, whilst the IPO market is currently closed, in time, confidence and investors will return to the markets, and that St Helen’s strategy to focus on quality businesses will be successful.
St Helen’s roots are in the PLUS Market where the Company retains its position as the leading adviser, acting for 36 companies. St Helen’s was recently awarded the Growth Company Investor PLUS Adviser of the Year for 2008.
Despite the downturn in corporate activity generally, the PLUS advisory side of our business is seeing increasing levels of enquiries, particularly from overseas companies exploring the possibility of listing on PLUS, which in turn is leading to an improving pipeline of companies using St Helen’s corporate services.
Having had an excellent first half as reported in September 2007, and although the second half has been challenging, the full year result is a Profit before tax of £141,000 compared to a Loss of £577,000 in the year ended 31 March 2007. Furthermore the Company remains well funded with cash in the bank as at 8 August 2008 of circa £1.4m.
We continue to focus on identifying opportunities across a number of sectors that are attractive to our institutional investor base. Success in identifying these opportunities will increase our profile further towards our ambition of becoming a leading small-cap stockbroking and advisory business in the UK.
Mark Warde Norbury
Chairman
8 August 2008
The Company expects to post the Report and Accounts to shareholders by the end of August 2008, and the Annual General Meeting is scheduled to take place at St Helen’s Capital offices at 15 St Helen’s Place, London EC3A 6DE on Tuesday 30th September at 12pm.
DIRECTORS’ REPORT
The Directors present their report together with the audited financial statements of the company for the year ended 31 March 2008.
Principal Activity
The Company’s principal activities continue to be the provision of Corporate Finance Advice and Broking Services to companies.
Review of the Business
St Helen’s Capital’s (‘St Helen’s’) stated objective is to become a leading small cap focused institutional stockbroker and financial adviser. In the last year the Company has successfully started to provide the full range of institutional broking services to small-cap AIM listed corporate clients.
A more comprehensive review may be found in the Chairman’s Statement above.
Results, Dividends, and Key Performance Indicators (‘KPI’s)
There are four financial KPI’s: gross margin, administrative expenses, operating profit, and cash
gross profit increased by 202% to £2.45m;
administrative expenses increased by 75% to £2.49m, including the cost of admission to AIM of c.£200,000;
resulting in an operating loss of £34,000 (compared to a loss of £606,000 in 2007);
cash at bank amounted to £1.8m (compared to a small overdraft in 2007)
The Directors do not recommend the payment of a dividend.
Position at 31st March 2008
An investment of £88,000 has been made in leasehold improvements (to additional offices) in order to house the greater number of staff, and to provide Meeting Rooms appropriate for AIM brokerage clients.
Available for sale investments reduced from £438,000 to £358,000 as a result of realising the investment in St Helen’s Finance Plc, and of participating at the IPO (or pre-IPO) stage of certain clients.
Trading investments reduced from £143,000 to £68,000 through a combination of modest realisations and depressed market values at year-end.
Trade and other receivables have increased from £152,000 to £282,000 largely as a result of higher levels of business activity.
Cash at bank stood at £1.8m (compared to a small overdraft in 2007) largely resulting from a £1.5m Placing in April 2007, supplemented by positive operating cash-flows and investment income.
Trade and other payables reduced by a modest 9% from £248,000 to £219,000 (compared to the 75% increase in administrative expenses) reflecting that 70% of administrative costs (excluding the cost of admission to AIM) are people related and paid for in the month that they are incurred, compared to 3rd party overheads which generally benefit from a period of credit.
The share capital and share premium accounts increased by £1.53m as a result of the £1.5m Placing and issues of shares to staff.
Net assets at 31 March 2008 were £2.36m compared to £0.47m in 2007.
Future Developments
Market conditions are challenging and this has been particularly demonstrated in the general sell off of small cap company shares as investors hunt for liquidity and cash. The loss of confidence in the markets and the investment prospects of companies have made it more difficult to raise equity funding. However, the Company believes that in time, confidence and investors will return to the markets, and that St Helen’s strategy to focus on quality businesses will be successful.
Principal risks and uncertainties
There is an inherent risk in any business which depends in part on one off transaction fees in order to generate profits because the earning of such fees can be unpredictable. To overcome this, a successful £1.5m Placing was closed on 26th April 2007.
The Company intends to expand its broking activity and as a result there is a risk that the cost base will increase more quickly than the revenue: however, monthly management accounts and periodic forecasts are used to monitor financial progress and highlight any imbalance.
There is also a need as the Company undertakes more complicated activities to develop its compliance and procedures accordingly. To meet these challenges the Company employs a full-time Compliance Officer and uses specialist external advisors whenever required.
There is risk that the current adverse market conditions continue into 2009 against which the Company has adequate cash resources (on the most pessimistic assumption that existing retainer income is the only source of income).
Supplier payment policy
It is the company's policy to settle all credit transactions in accordance with terms agreed with suppliers. Creditor days at the year end amounted to 45 days (2007: 18 days), the former being inflated by unpaid AIM Admission costs and rent due on a recently acquired property lease.
Charitable Donations
The Company made Charitable Donations of £250 during the year (2006: £Nil).
Employee Share Ownership Plan Trust (‘ESOP’)
The ESOP holds 232,603 shares (2006: 232,603) in the Company, of which at 31st March 2008 none had been unconditionally granted to any of the Company’s employees.
The Trustees are Messrs Howard Flight and Jon Pither, the Company’s Non-Executive Directors.
Directors
The Directors who served throughout the year were:
Mark Warde-Norbury (Chairman)
Barry Hocken (PLUS Markets Division)
Howard Flight (Non Executive)
Ruari McGirr (Chief Executive)
Jon Pither (Non Executive)
Sebastian Wykeham (Head of Broking)
Directors' interests
The Directors' interests in the shares and options of the company were as stated below:
| Ordinary shares of 5p each |
At 31 March
2008 |
At 31 March
2007 |
| M Warde – Norbury |
3,254,276 |
3,254,276 |
| H E Flight |
638,060 |
250,000 |
| B Hocken |
402,500 |
402,500 |
| R McGirr |
1,457,636 |
1,457,636 |
| J Pither |
2,589,682 |
3,189,682 |
| S G M Wykeham |
1,457,636 |
1,457,636 |
| |
Number of options |
Exercise price (pence) |
Date of grant |
Exercise date |
Exercise date |
M Warde-Norbury |
400,000
400,000
200,000
1,000,000
|
10
20
30
|
30/03/07
30/03/07
30/03/07
|
30/03/07
30/03/07
30/03/07
|
30/03/12
30/03/12
30/03/12
|
B Hocken |
200,000
200,000
100,000
500,000
|
10
20
30
|
30/03/07
30/03/07
30/03/07
|
30/03/07
30/03/07
30/03/07
|
30/03/12
30/03/12
30/03/12
|
R.McGirr |
4,342,364 |
5 |
02/02/07 |
02/02/10 |
02/02/17 |
J Pither |
403,923
403,923
1,111,111
400,000
400,000
200,000
2,918,957
|
10
15
9
10
20
30
|
06/05/04
06/05/04
31/03/05
30/03/07
30/03/07
30/03/07
|
06/05/05
06/05/05
31/03/05
30/03/07
30/03/07
30/03/07
|
13/07/09
13/07/09
31/06/08
30/03/12
30/03/12
30/03/12
|
S Wykeham |
4,342,364 |
5 |
02/02/07 |
02/02/10 |
02/02/17 |
Substantial Shareholders
As at 9 July 2008 (being the last practical date prior to the date of this document) and save as set out below, the Company was not aware of any person, who, other than the Directors, directly or indirectly, had an interest representing 3 per cent or more of the issued ordinary share capital in the Company (being the threshold at or above which, in accordance with the provisions of Section 5 of the Disclosure and Transparency Directive published by the FSA, any interest must be disclosed by the Company):
3% shareholders No. shares %
Keydata Investment Services 2,110,000 4.95
New Century AIM VCT 2,000,000 4.69
Fort Alice Investments 1,810,000 4.24
New Century AIM VCT2 1,500,000 3.52
Williams de Broe Clients 1,447,512 3.39
JM Finn Nominees Limited 1,405,000 3.29
Starvest PLC 1,350,000 3.16
Ansbacher & Co. 1,287,000 3.02
Directors' Responsibilities
Company law requires the directors to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing those financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently; making judgements and estimates that are reasonable and prudent;
state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The Directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the financial statements comply with the Companies Act 1985 (as amended by the Companies Act 2006). They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The Directors are responsible for the maintenance and integrity of the corporate and financial information included in the Company’s website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.
Directors’ and Officers’ Insurance
The Company purchases and maintains Liability Insurance for its Directors and Officers as permitted by the Companies Act 1985.
Statement of Disclosure to Auditor
So far as the Directors are aware, there is no relevant audit information of which the Company's auditors are unaware. Additionally, the Directors have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company's auditors are aware of that information.
Auditors
In accordance with section 385 of the Companies Act 1985, a resolution proposing that UHY Hacker Young LLP be reappointed as auditors of the company will be put to the Annual General Meeting.
On behalf of the Board
Mark Warde - Norbury
Chairman
8 August 2008
FINANCIALS
The preliminary results do not constitute full statutory accounts within the meaning of Section 240 of the Companies Act 1985.
The preliminary results have been prepared in accordance with applicable International Financial Reporting Standards.
Income Statement
Year ended 31 March 2008
| |
Number of options
|
Exercise price (pence)
|
Date of grant
|
Exercise date
|
Exercise date
|
M Warde-Norbury |
400,000
400,000
200,000
1,000,000
|
10
20
30
|
30/03/07
30/03/07
30/03/07
|
30/03/07
30/03/07
30/03/07
|
30/03/12
30/03/12
30/03/12
|
B Hocken |
200,000
200,000
100,000
500,000
|
10
20
30
|
30/03/07
30/03/07
30/03/07
|
30/03/07
30/03/07
30/03/07
|
30/03/12
30/03/12
30/03/12
|
R.McGirr |
4,342,364 |
5
|
02/02/07
|
02/02/10
|
02/02/17
|
J Pither |
403,923
403,923
1,111,111
400,000
400,000
200,000
2,918,957
|
10
15
9
10
20
30
|
06/05/04
06/05/04
31/03/05
30/03/07
30/03/07
30/03/07
|
06/05/05
06/05/05
31/03/05
30/03/07
30/03/07
30/03/07
|
13/07/09
13/07/09
31/06/08
30/03/12
30/03/12
30/03/12
|
S Wykeham |
4,342,364 |
5
|
02/02/07
|
02/02/10
|
02/02/17
|
Balance Sheet
As at 31 March 2008
| |
|
Notes |
Year ended
31-Mar
2008
(£) |
Year ended
31-Mar
2007
Restated
(£) |
Non current assets |
|
|
|
|
Property, plant and equipment |
|
13 |
77,844 |
0 |
Current assets |
|
|
|
|
Available for sale investments |
|
14 |
357,709 |
437,669 |
Trading investments |
|
15 |
67,629 |
142,983 |
Trade and other receivables |
|
16 |
282,310 |
152,613 |
Cash and cash equivalents |
|
17 |
1,816,395 |
206 |
| |
|
|
|
|
| |
|
|
2,524,044 |
733,471 |
Total assets |
|
|
2,601,888 |
733,471 |
Current liabilities |
|
|
|
|
Bank overdrafts |
|
|
0 |
(14,975) |
Trade and other payables |
|
18 |
(219,121) |
(247,946) |
Corporation tax |
|
|
(19,283) |
0 |
| |
|
|
|
|
Total current liabilities |
|
|
(238,404) |
(262,921) |
Net assets |
|
|
2,363,484 |
470,550 |
Equity |
|
|
|
|
Capital and reserves attributable to equity shareholders |
|
|
Share capital |
|
19 |
2,132,800 |
1,366,085 |
Share premium account |
|
19 |
1,171,708 |
408,432 |
Revaluation reserves |
|
|
133,712 |
150,247 |
Other reserves |
|
|
363,316 |
105,816 |
Retained earnings |
|
|
(1,438,052) |
(1,560,030) |
| |
|
|
2,363,484 |
470,550 |
Statement of Changes in Equity
Year ended 31 March 2008
|
|
|
Share capital
(£)
|
Share premium
(£)
|
Revaluation reserve
(£)
|
Other reserves
(£)
|
Retained earnings
(£)
|
|
Restated balance at 31 March 2006
|
|
957,447
|
326,307
|
277,943
|
4,909
|
(982,895)
|
|
|
|
|
|
|
|
|
|
Loss for the year
|
|
|
|
|
|
(577,135)
|
|
Issue of ordinary share capital
|
|
408,638
|
82,125
|
|
|
|
|
Revaluation during the year
|
|
|
|
(127,696)
|
|
|
|
Provision for share-based payments
|
|
|
|
|
100,907
|
|
|
|
|
|
|
|
|
|
|
Balance at 31 March 2007
|
|
1,366,085
|
408,432
|
150,247
|
105,816
|
(1,560,030)
|
|
|
|
|
|
|
|
|
|
Profit for the period
|
|
|
|
|
|
121,978
|
|
Issue of ordinary share capital
|
|
766,715
|
763,276
|
|
|
|
|
Revaluation during the period
|
|
|
|
(16,535)
|
|
|
|
Provision for share-based payments
|
|
|
|
|
257,500
|
|
|
|
|
|
|
|
|
|
|
Balance at 31 March 2008
|
|
2,132,800
|
1,171,708
|
133,712
|
363,316
|
(1,438,052)
|
|
Movements of the Revaluation reserve consist of:
|
|
|
2008
|
2007
|
|
|
|
|
|
|
|
|
Unrealised gains / (losses)
|
|
46,435
|
(116,386)
|
|
|
Release of unrealised gains to Profit and (Loss)
|
|
(62,970)
|
(11,310)
|
|
|
|
|
|
|
|
|
|
|
(16,535)
|
(127,696)
|
|
|
|
|
|
|
|
Other reserves consist of:
|
|
|
2008
|
2007
|
|
|
|
|
|
|
|
|
Reserve for employee share ownership plan ('ESOP')
|
|
(50,254)
|
(50,254)
|
|
|
Reserve for share based payments
|
|
413,570
|
156,070
|
|
|
|
|
|
|
|
|
|
|
363,316
|
105,816
|
|
|
|
|
|
|
|
The Reserve for ESOP comprises 232,603 shares in the Company held in an ESOP Trust. As at 31 March 2008 and 31 March 2007, none of the shares had been unconditionally granted to any of the Company's employees and had an aggregate market value of £30,820 (2007: £24,423).
|
Cash Flow Statement
Year ended 31 March 2008
|
|
|
Notes
|
31-Mar2008
(£)
|
31-Mar
2007
Restated
(£)
|
|
|
|
|
|
|
|
Net cash from operating activities
|
|
|
|
|
|
Operating loss
|
|
|
(34,220)
|
(605,557)
|
|
Depreciation
|
|
|
10,000
|
0
|
|
Share based payments
|
|
|
257,500
|
100,907
|
|
|
|
|
|
|
|
Operating cash flows before movements in working capital
|
|
|
233,280
|
(504,650)
|
|
|
|
|
|
|
|
Movement in working capital
|
|
|
|
|
|
Decrease / (increase) in receivables
|
|
|
(129,697)
|
52,511
|
|
Increase / (decrease) in payables
|
|
|
(28,825)
|
110,526
|
|
|
|
|
|
|
|
|
|
|
(158,523)
|
163,037
|
|
Operating cash flow
|
|
|
74,758
|
(341,613)
|
|
|
|
|
|
|
|
Investment activities
|
|
|
|
|
|
Interest receivable
|
|
|
96,514
|
147
|
|
Proceeds from disposal of tangible fixed assets
|
|
|
0
|
0
|
|
Proceeds on disposal of trading investments
|
|
|
93,274
|
0
|
|
Proceeds on disposal of available for sale investments
|
|
|
228,935
|
207,667
|
|
Expenditure on tangible fixed assets
|
|
|
(87,844)
|
0
|
|
Expenditure on available for sale investments
|
|
|
(104,362)
|
(229,359)
|
|
Placing of funds on fixed term deposits
|
|
17
|
(1,500,000)
|
0
|
|
|
|
|
|
|
|
Cash flow from investing activities
|
|
|
(1,273,483)
|
(21,545)
|
|
|
|
|
|
|
|
Financing
|
|
|
|
|
|
Issue of share capital
|
|
|
1,529,990
|
490,763
|
|
Interest payable
|
|
|
(100)
|
(10,657)
|
|
|
|
|
|
|
|
Cash flow from financing activities
|
|
|
1,529,890
|
480,106
|
|
|
|
|
|
|
|
Net increase / (decrease) in cash
|
|
|
|
|
|
and cash equivalents
|
|
17
|
331,164
|
116,948
|
|
|
|
|
|
|
|
Cash and cash equivalents at start of period
|
|
|
(14,769)
|
(131,717)
|
|
Cash and cash equivalents at end of period
|
|
|
316,395
|
(14,769)
|
|
|
|
|
|
|
|
Increase / (decrease) in cash and cash equivalents
|
|
|
331,164
|
116,948
|
Notes to the financial statements
For the year ended 31 March 2008
1. General information
St Helen's Capital Plc is a company registered in England and Wales under the Companies Act 1985. The Company's principal activities are the provision of advice and broking services to companies listed on the the AIM Market (operated by the London Stock Exchange) and PLUS, the primary market (formerly known as Ofex) operated by PLUS Markets Plc.
The financial statements are presented in pounds sterling because that is the currency of the primary economic environment in which the company operates.
The company's registered office and principal place of business is 15 St Helen's Place, London, EC3A 6DE. The company's registered number is 3515836.
2. Significant accounting policies
a. Basis of accounting
The financial statements have been prepared for use in the European Union. Up until 31 March 2007 the company prepared its financial statements under UK Generally Accepted Accounting Principles (' UK GAAP'). From 1 April 2007 the company's financial statements have been prepared in accordance with IFRS and International Financial Reporting Interpretations Committee ('IFRIC') interpretations adopted by the European Union, and with those parts of the Companies Act 1985 applicable to companies reporting under IFRS, with the prior periods being reported on the same basis.
The disclosures under IFRS 1 concerning the transition from UK GAAP to IFRS's are given in Note 24.
The financial statements have been prepared on the historical cost basis as modified by the valuation of certain financial instruments, as described below.
The Company has one wholly owned subsidiary undertaking, St Helen's Capital Group Limited, a dormant company, registered in England and Wales, Registered No. 5814084, with a Share Capital of £1. As the group accounts are virtually identical to those of the Company, the Directors have determined not to present separate accounts for the Group on the grounds of materiality.
The principal accounting policies are set out below.
b. Financial risk management objectives and policies
The Company's principal financial assets are cash and cash equivalents, trade and other receivables and investments. The Company's credit risk is primarily attributable to its trade receivables and its market risk is primarily attributable to its investments. The amounts presented in the Balance Sheet are net of allowances for impairment of receivables.
c. Financial instruments
Available for sale investments
Available for sale investments are initially measured at cost, including transaction costs. At each reporting date these instruments are measured at their fair values and resultant gains and losses, after adjusting for taxation, are recognised directly in equity via the revaluation reserve, until the security is disposed of or is determined to be impaired, at which time the cumulative gain or loss previously recognised in equity is included in the net profit or loss for the period.
Trading investments
Investments held for trading consist of options held in quoted companies, which are held at fair value. At each reporting date fair value is re-assessed and resultant gains and losses are included directly in net profit and loss for the period.
Trade and other receivables
Trade and other debtors are measured at fair value.
Appropriate allowance for estimated irrecoverable amounts is recognised in the Income Statement where there is objective evidence that the asset is impaired. The allowance recognised is measured as the difference between the carrying amount and the present value of estimated future cash flows discounted at the effective interest rate computed at initial recognition.
Trade and other payables
Trade and other payables are measured at fair value.
Financial liabilities and equity
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of the liabilities.
d. Foreign currencies
Transactions in foreign currencies are recorded at the rate of exchange at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are reported at the rates of exchange prevailing at that date. Gains and losses arising during the period on transactions denominated in foreign currencies are treated as normal items of income and expenditure in the Income Statement.
e. Operating leases
Rentals payable under operating leases are charged to income on a straight-line basis over the term of the relevant lease.
f. Property, plant and equipment
Property, plant and equipment are stated at cost, net of depreciation and any provision for impairment.
Depreciation is provided at rates calculated to write off the cost, less estimated residual value, of each asset evenly over its estimated useful life as follows:
Leasehold improvements are depreciated over the term of the lease.
Computer equipment and software is written off in the period of purchase.
At each reporting date the net book value of these assets is compared against their economic value, and resulting impairments in value are written off in the Income Statement for the period.
g. Cash and cash equivalents
Cash and cash equivalents comprise cash in hand, demand deposits and fixed term deposits of less than one year (see note 17).
h. Taxation
The company has not achieved taxable profits during the period under review, accordingly there is no tax liability.
The company had trading losses available to carry forward at 31 March 2008 of approximately £1.1m (2007: £1.5m). No deferred tax has been recognised in respect of trading profit as there was insufficient evidence available as to the timing of any future recovery.
In future years mainstream corporation tax is likely to be payable, which will be based on taxable profit for the year. Taxable profit differs from net profits as reported in the Income Statement because it excludes items of income or expense which are taxable or deductible in other years and it further excludes items which are never taxable or deductible. The Company's liability for current tax will be calculated using tax rates which have been enacted or substantively enacted by the Balance Sheet date.
Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the Financial Statements and the corresponding tax bases in the computation of taxable profit, and is accounted for using the Balance Sheet Liability Method. Deferred tax liabilities are generally recognised for all temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be used. Such assets and liabilities are not recognised if the temporary difference arises from the initial recognition of goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that effects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each Balance Sheet date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax is calculated at the rates that are expected to apply in the period when the liability is settled or the asset realised. Deferred tax is charged or credited to the Income Statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same tax authority and the Company intends to settle its current tax assets and liabilities on a net basis.
i. Revenue recognition
Revenue is measured at the fair value of the consideration received or receivable and represents amounts receivable for services provided in the normal course of business, net of discounts, VAT, and other sales related taxes.
Revenue comprises broking commissions, and retainer fees for corporate finance advisory services.
Where the revenue is success-fee based, it is taken to the Income Statement on the successful completion of the transaction. Retainer fees are taken to the Income Statement pro-rata to the period invoiced.
Interest income is based on the effective rate applicable for the period during which demand deposits are held.
j. Employee Share Ownership Plans Trust ('ESOP')
The ESOP trust is accounted for in line with IAS 32, 'Financial Instruments - Presentation', re: treasury shares whereby shares have been shown at cost in a separate Reserve as a deduction from Shareholders' Funds.
k. Share based payments
The company has made share-based payments to certain directors and employees through the issue of options. The fair value of these payments is calculated at the date of grant through the use of a binomial pricing model. The expense is recognised on a straight-line basis over the vesting period, based on the Company's estimate of shares that will eventually vest.
l. General information
At the date of authorisation of the financial statements, the following Standards and Interpretations (relevant to the company's activities) which have not been applied in the financial statements were in issue but not yet effective.
IFRS 8 - Operating Segments and the revised IAS 1, Presentation of Financial Statements.
It is not anticipated that the adoption of these accounting standards will have a significant effect on the Financial Standards.
3. Critical accounting judgement and key sources of estimation uncertainty.
Equity-settled share-based payments
The fair value of share based payments is calculated by reference to a simulation model. Inputs into the model are based on the Directors' best estimates of appropriate volatility, discount rate and share price growth
Valuation of investments
Trading investments include options over securities which have been received as consideration for corporate finance services rendered. These assets have been valued according to the mid market price, where the share prices of the companies concerned are quoted on a recognised stock exchange, less the exercise price of the options.
Bad debt policy
The Company regularly reviews all outstanding balances and provides for amounts it considers irrecoverable.
4. Business and geographical segments
The directors consider that there is only one activity undertaken by the company, that of corporate finance advisory. All of this activity was undertaken in the United Kingdom.
|
|
|
2008
|
2007
|
|
|
|
(£)
|
(£)
|
|
|
|
|
|
|
Fees earned from corporate finance
|
|
2,718,529
|
871,360
|
5. Profit of the year
|
|
|
2008
|
2007
|
|
|
|
(£)
|
(£)
|
|
The Operating Loss for the year has been arrived at after charging:
|
|
|
|
|
|
|
|
|
|
Depreciation of property, plant and equipment
|
|
10,000
|
0
|
|
|
|
|
|
|
Operating lease rentals
|
|
137,297
|
61,197
|
|
|
|
|
|
|
Share based payments
|
|
257,500
|
116,376
|
|
|
|
|
|
|
Staff costs (Note 9)
|
|
1,589,800
|
677,213
|
|
|
|
|
|
|
Auditors' remuneration for audit services
|
|
0
|
7,000
|
|
|
|
|
|
|
Amounts payable to UHY Hacker Young by the company in respect of non-audit services were:
|
|
|
|
|
|
|
Auditors' remuneration:
|
- for non audit taxation
|
10,825
|
11,000
|
|
|
- for non audit other
|
34,113
|
13,245
|
6. Investment revenues
|
|
|
2008
|
2007
|
|
|
|
(£)
|
(£)
|
|
The Operating Loss for the year has been arrived at after charging:
|
|
|
|
|
|
|
|
|
|
Depreciation of property, plant and equipment
|
|
10,000
|
0
|
|
|
|
|
|
|
Operating lease rentals
|
|
137,297
|
61,197
|
|
|
|
|
|
|
Share based payments
|
|
257,500
|
116,376
|
|
|
|
|
|
|
Staff costs (Note 9)
|
|
1,589,800
|
677,213
|
|
|
|
|
|
|
Auditors' remuneration for audit services
|
|
0
|
7,000
|
|
|
|
|
|
|
Amounts payable to UHY Hacker Young by the company in respect of non-audit services were:
|
|
|
|
|
|
|
Auditors' remuneration:
|
- for non audit taxation
|
10,825
|
11,000
|
|
|
- for non audit other
|
34,113
|
13,245
|
| |
7. Other gains and losses
|
|
|
2008
|
2007
|
|
|
|
(£)
|
(£)
|
|
|
|
|
|
|
Profit on disposal of available for sale investments
|
|
69,397
|
4,680
|
|
Profit on disposal of trading investments
|
|
57,237
|
20,668
|
|
Increase / (decrease) in the fair value of trading investments
|
|
(43,067)
|
53,681
|
|
Impairment of available for sale investments
|
|
(4,500)
|
(40,097)
|
|
|
|
|
|
|
|
|
79,067
|
38,932
|
8. Finance Costs
|
|
|
2008
|
2007
|
|
|
|
(£)
|
(£)
|
|
|
|
|
|
|
Interest payable on bank overdraft
|
|
100
|
10,657
|
|
|
|
|
|
9.1. Staff Costs
|
|
|
2008
|
2007
|
|
|
|
(£)
|
(£)
|
|
|
|
|
|
|
Wages and salaries
|
|
1,216,565
|
501,926
|
|
Social security costs
|
|
115,735
|
55,911
|
|
Pension costs
|
|
0
|
3,000
|
|
Share based payments
|
|
257,500
|
116,376
|
|
|
|
|
|
|
|
|
1,589,800
|
677,213
|
|
The company does not operate any form of pension scheme. Payments, as outlined below, have been made during the comparative period are to a director's personal pension plan.
|
9.2. Directors' emoluments
|
|
|
2008
|
2007
|
|
|
|
(£)
|
(£)
|
|
|
|
|
|
|
The emoluments of the highest paid Director were:
|
|
162,000
|
83,667
|
|
|
|
|
|
|
The aggregate Directors' remuneration was:
|
|
550,357
|
315,800
|
|
|
|
|
|
|
Pension contributions - total
|
|
0
|
3,000
|
|
Pension contributions - highest paid Director
|
|
0
|
3,000
|
|
The total benefit of options to employees relating to
|
|
|
|
|
Directors was:
|
|
180,824
|
0
|
10. Tax
| |
2008 |
2007 |
The tax charge comprises: |
(£) |
(£) |
| |
|
|
Mainstream UK corporation tax deriving from profits |
19,283
|
0 |
for the periods |
|
|
| |
|
|
Total current tax |
19,283
|
0 |
| |
|
|
Deferred tax |
|
|
Charge in respect of timing differences |
0
|
0 |
| |
|
|
Total deferred tax |
0
|
0 |
Total tax on profit / (loss) from ordinary activities |
19,283
|
0 |
| |
|
|
The tax charge for the period differs from that resulting from applying the standard rate of UK Corporation |
Tax of 20% (2007:19%) to the profit before tax for the reasons set out in the reconciliation below. |
| |
|
|
Profit / (loss) per financial information |
121,978
|
(577,135)
|
Unrealised (gains) / losses on trading investments |
43,067
|
1,319
|
Disallowed items |
512,319
|
159,810
|
Capital allowances |
0
|
0
|
Losses carried forward / (used) |
(580,949)
|
416,006
|
| |
|
|
Taxable profit / (loss) |
96,415
|
0
|
Tax at 20% (2007:19%) |
19,283
|
0
|
Tax expense for the year |
19,283
|
0
|
11. Earnings per share
|
|
|
2008
|
2007
|
|
|
|
Earnings
|
Earnings
|
|
|
|
|
|
|
Based on profit / (loss) of
|
|
121,978
|
(577,135)
|
|
|
|
|
|
|
Where losses are incurred, the diluted earnings per share calculation is showing a lower loss per share, making the options anti-dilutive. Accordingly the diluted earnings per share and basic earnings per share are the same.
|
|
|
|
No. shares
|
No. shares
|
|
Weighted average number of Ordinary Shares in issue
|
|
41,218,795
|
21,025,290
|
|
for the purpose of basic earnings per share
|
|
|
|
|
Effect of dilutive potential Ordinary Shares:
|
|
|
|
|
Share options
|
|
442,687
|
197,329
|
|
|
|
|
|
|
Weighted average number of Ordinary Shares in issue
|
|
41,661,482
|
21,222,619
|
|
for the purpose of diluted earnings per share
|
|
|
|
12. Property, plant and equipment
|
13. Property, plant and equipment
|
|
Leasehold improvements
|
|
|
|
2008
|
2007
|
|
Cost
|
|
(£)
|
(£)
|
|
At 1 April 2007
|
|
0
|
0
|
|
Additions
|
|
87,844
|
0
|
|
Disposals
|
|
0
|
0
|
|
|
|
|
|
|
At 31 March 2008
|
|
87,844
|
0
|
|
|
|
|
|
|
Accumulated depreciation
|
|
|
|
|
At 1 April 2007
|
|
0
|
0
|
|
Provision for the year
|
|
10,000
|
0
|
|
On disposals
|
|
0
|
0
|
|
|
|
|
|
|
At 31 March 2008
|
|
10,000
|
0
|
|
|
|
|
|
|
Net book value
|
|
|
|
|
|
|
|
|
|
At 31 March 2008
|
|
77,844
|
0
|
|
|
|
|
|
|
At 31 March 2007
|
|
0
|
0
|
13. Available for sale investments
|
|
|
2008
|
2007
|
|
|
|
(£)
|
(£)
|
|
|
|
|
|
|
Quoted investments
|
|
331,595
|
408,055
|
|
Unquoted investments
|
|
26,114
|
29,614
|
|
|
|
|
|
|
|
|
357,709
|
437,669
|
Unquoted investments are initially based on cost. At each reporting date these investments are measured at their fair values which if below cost, result in a specific provision for impairment in value.
The available for sale investments included an investment in St Helen's Finance PLC, which represented at 31 March 2007 more than 20% of the net assets of the Company. This investment was realised for cash in June 2007.
14.Trading investments
|
|
|
2008
|
2007
|
|
|
|
(£)
|
(£)
|
|
|
|
|
|
|
Quoted Options
|
|
67,629
|
142,983
|
|
|
|
|
|
|
|
|
|
|
|
Quoted options are in listed securities which present the Company with opportunity for return through trading gains. The fair value of these securities is based on quoted market prices.
|
| |
15. Trade and other receivables
|
|
|
|
|
|
|
|
2008
|
2007
|
|
|
|
(£)
|
(£)
|
|
|
|
|
|
|
Trade debtors
|
|
105,136
|
51,433
|
|
Other debtors
|
|
62,829
|
22,016
|
|
Prepayments and accrued income
|
|
114,345
|
79,164
|
|
|
|
|
|
|
|
|
282,310
|
152,613
|
All debtors are receivable within one year of the Balance Sheet date.
The Directors consider that the carrying amounts of trade and other receivables approximates their fair values.
The Company does not normally have any significant concentration of credit risk, with exposure spread over a large number of counterparties and customers. Significant risk does occur at the conclusion of a large corporate finance and broking transaction, normally measured in a few days, in anticipation of the payment of the Company's fees and commissions. No such risk existed at the reporting date.
16. Cash and cash equivalents
|
|
|
2008
|
2007
|
|
|
|
(£)
|
(£)
|
|
|
|
|
|
|
Cash held directly at UK Clearing Banks
|
|
316,395
|
206
|
|
Funds held on fixed term deposits
|
|
1,500,000
|
0
|
|
|
|
|
|
|
|
|
1,816,395
|
206
|
| |
As the balances mature over a period greater than three months for the purpose of the cash flow statement they do not meet the definition of cash or a cash equivalent and have therefore been shown as an investment. In all other respects, the deposit meets the definition of a cash balance and has therefore been disclosed as such on the face of the Balance Sheet.
17. Trade and other payables
|
|
|
2008
|
2007
|
|
|
|
(£)
|
(£)
|
|
|
|
|
|
|
Trade payables
|
|
111,706
|
37,346
|
|
Other payables and accruals
|
|
71,255
|
172,520
|
|
Taxes and social security
|
|
36,160
|
38,080
|
|
|
|
|
|
|
|
|
219,121
|
247,946
|
| |
18. Share capital
|
|
|
|
|
|
Authorised
|
|
|
|
|
Ordinary shares of 5p (number)
|
|
80,000,000
|
40,000,000
|
|
Value of Ordinary shares
|
|
4,000,000
|
2,000,000
|
|
|
|
|
|
|
Issued
|
|
|
|
|
|
Issued
|
Share
|
|
|
|
|
|
Ordinary
|
|
share
|
premium
|
|
Ordinary shares of 5p
|
|
Date
|
Premium
|
shares
|
|
capital
|
account
|
|
|
|
|
|
(number)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issued at 31 March 2006
|
|
|
|
19,148,930
|
|
957,447
|
326,307
|
|
Issue of shares
|
|
31-Aug-06
|
3p
|
2,737,500
|
|
136,875
|
82,125
|
|
Issue of shares
|
|
31-Mar-07
|
0
|
5,435,272
|
|
271,764
|
0
|
|
Issued at 31 March 2007
|
|
|
|
27,321,702
|
|
1,366,085
|
408,432
|
|
Issue of shares
|
|
26-Apr-07
|
5.05p
|
14,925,374
|
|
746,269
|
753,731
|
|
Issue of shares
|
|
30-Jun-07
|
1p
|
166,500
|
|
8,325
|
1,665
|
|
Issue of shares
|
|
22-Oct-07
|
3.25p
|
121,212
|
|
6,061
|
3,939
|
|
Issue of shares
|
|
07-Nov-07
|
3.25p
|
121,212
|
|
6,061
|
3,939
|
|
Issued at 31 March 2008
|
|
|
|
42,656,000
|
|
2,132,800
|
1,171,708
|
| |
19. Operating leases
At the reporting dates, the Company had outstanding commitments for future minimum lease payments under non-cancellable operating leases in relation to Leasehold Property, and Other Assets, which fall due as follows:
|
|
|
2008
|
2007
|
|
|
|
(£)
|
(£)
|
|
Leasehold Property
|
|
|
|
|
Within one year
|
|
106,620
|
44,250
|
|
In the second to fifth year (inclusive)
|
|
382,230
|
382,230
|
|
|
|
|
|
|
|
|
488,850
|
221,250
|
|
Other Assets
|
|
|
|
|
Within one year
|
|
2,149
|
2,538
|
|
In the second to fifth year (inclusive)
|
|
6,447
|
6,447
|
|
|
|
|
|
|
|
|
8,596
|
6,255
|
20. Share based payments
The company has two share option schemes for all employees. Options are exercisable at a price agreed upon in the share option agreement on the date of grant. The vesting period lies between immediate and ten years. Each option will lapse if it remains unexercised after a period of ten years from the date of grant, or the option holder ceases to be an employee of the Company.
|
Granted/ (lapsed - date)
|
|
|
Date of grant
|
Latest
exercise date
|
Restrictions
|
Exercise
Price
|
Number
of shares
|
|
Unapproved
|
|
|
06-May-04
|
13-Jul-09
|
Note 4, 6
|
10p
|
403,923
|
|
Unapproved
|
|
|
06-May-04
|
13-Jul-09
|
Note 4, 6
|
10p
|
403,923
|
|
Unapproved
|
|
|
06-May-04
|
13-Jul-09
|
Note 4, 6
|
15p
|
403,923
|
|
Unapproved
|
|
|
06-May-04
|
13-Jul-09
|
Note 4, 6
|
15p
|
403,923
|
|
Unapproved
|
|
|
31-Mar-05
|
30-Jun-08
|
Note 4, 6
|
9p
|
1,111,111
|
|
Granted and not lapsed at 31 March 2006
|
|
|
|
|
2,726,803
|
|
Approved
|
|
|
02-Feb-07
|
02-Feb-17
|
Note 1, 3, 4
|
5p
|
2,608,500
|
|
Unapproved
|
|
|
02-Feb-07
|
02-Feb-17
|
Note 1, 3, 4
|
5p
|
8,108,952
|
|
Unapproved - lapsed 12 Feb 07
|
|
|
06-May-04
|
13-Jul-09
|
Note 4, 6
|
10p
|
-403,923
|
|
Unapproved - lapsed 12 Feb 07
|
|
|
06-May-04
|
13-Jul-09
|
Note 4, 6
|
15p
|
-403,923
|
|
Approved
|
|
|
05-Mar-07
|
05-Mar-17
|
Note 1, 4
|
10p
|
500,000
|
|
Approved
|
|
|
30-Mar-07
|
30-Mar-12
|
Note 5
|
10p
|
600,000
|
|
Unapproved
|
|
|
30-Mar-07
|
30-Mar-12
|
Note 5
|
10p
|
400,000
|
|
Approved
|
|
|
30-Mar-07
|
30-Mar-12
|
Note 5
|
20p
|
600,000
|
|
Unapproved
|
|
|
30-Mar-07
|
30-Mar-12
|
Note 5
|
20p
|
400,000
|
|
Approved
|
|
|
30-Mar-07
|
30-Mar-12
|
Note 5
|
30p
|
169,500
|
|
Unapproved
|
|
|
30-Mar-07
|
30-Mar-12
|
Note 5
|
30p
|
330,500
|
|
Granted and not lapsed at 31 March 2007
|
|
|
|
|
15,636,409
|
|
Approved
|
|
|
17-May-07
|
17-May-17
|
Note 1, 4
|
11.5p
|
500,000
|
|
Approved
|
|
|
15-Jun-07
|
15-Jun-17
|
Note 1, 4
|
11.5p
|
525,000
|
|
Approved
|
|
|
24-Sep-07
|
24-Sep-17
|
Note 1, 4
|
11p
|
250,000
|
|
Approved
|
|
|
24-Sep-07
|
24-Sep-17
|
Note1, 2, 4
|
11p
|
250,000
|
|
Approved
|
|
|
08-Oct-07
|
08-Oct-17
|
Note 1, 4
|
16.5p
|
250,000
|
|
Approved
|
|
|
05-Nov-07
|
05-Nov-17
|
Note 1, 4
|
16.5p
|
250,000
|
|
Approved
|
|
|
05-Nov-07
|
05-Nov-17
|
Note 1, 4
|
16.5p
|
100,000
|
|
Granted and not lapsed at 31 March 2008
|
|
|
|
|
17,761,409
|
Note 1 Options may be exercised at any time. However, if the option holder ceases to be an employee of the Company within 3 years of the date of grant, any gain on options exercised will be forfeited.
Note 2 These options are only exercisable if the Company's share price reaches 30p/share, subject also to the restrictions described in Note 1.
Note 3 Dependant on the company achieving four objectives; gaining admission to AIM and the company's share price reaching 20p, 30p and 50p respectively.
Note 4 If the options remain unexercised after a period of ten years from the date of grant, the options expire.
Note 5 Based on the share price reaching 10p, 20p and 30p respectively. The shares have no further restrictions and will expire if unexercised five years after the date of grant.
Note 6 If the option holder ceases to be an employee, his right to exercise automatically lapses (subject to a 12 month extension for compassionate reasons). To the extent that the options at the exercise price(s) for each individual falls within the EMI limit of £100,000, EMI schemes have been written to reflect the above arrangements. To the extent that the value exceeds £100,000, the options will be subject to an 'Unapproved Scheme'. These limits were revised upwards In April 2008 to £120,000 to reflect the provisions of the 2008 Budget.
Summary share options outstanding during the year
|
|
2008
|
2008
|
2007
|
2007
|
|
|
|
|
|
Weighted
|
|
Weighted
|
|
|
|
|
|
average
|
|
average
|
|
|
|
|
No. share
|
exercise price
|
No. share
|
exercise price
|
|
|
|
|
options
|
in pence
|
options
|
in pence
|
|
|
|
|
|
|
|
|
|
Outstanding at beginning of the year
|
15,636,409
|
7.9
|
2,726,803
|
11.1
|
|
Granted during the year
|
|
|
2,125,000
|
12.8
|
13.717.452
|
7.6
|
|
Lapsed during the year
|
|
|
0
|
0.0
|
(807,846)
|
12.5
|
|
Exercised during the year
|
|
|
0
|
0.0
|
0
|
0.0
|
|
Expired during the year
|
|
|
0
|
0.0
|
0
|
0.0
|
|
|
|
|
|
|
|
|
|
Outstanding at the end of the year
|
17,761,409
|
8.5
|
15,636,409
|
7.9
|
|
|
|
|
|
|
|
|
|
Exerciseable at the end of the year
|
4,418,957
|
15.2
|
4,418,957
|
15.2
|
The Company recognised £257,500 (2006: £116,376) share based payments in relation to the above.
The weighted average estimated fair value for the share options was calculated using a binomial pricing model. The expected volatility was calculated at 40% based on industry averages for the sector as adjusted to account for the high growth anticipated for the Company during the next five years and the risk free interest rate has been taken at 5%. Using these parameters, the calculation of the cost of share based payments compares the exercise price with the market price on the day of grant.
21. Capital Risk Management The Company is not reliant on debt finance, its operations currently being funded by equity finance (comprising share capital, share premium, and retained earnings) which totalled £1.9m at the year end. The Company regularly monitors its capital needs to ensure that sufficient funding is available for its operational needs.
As an FSA regulated business [which does not hold client funds], the Company has to ensure that it maintains a minimum net asset position of €50,000 (equivalent to £40,000), which it met with ease at 31 March 2008.
22. Related party transactions
Companies in whom the Company holds (or held) an investment which have paid fees to, or charged the Company for services.
St Helen's Finance PLC ('SHF')
The Company owned no shares in SHF at 31 March 2008: however, at 31 March 2007 the Company owned 2,181,662 shares (15.1%). The Company's entire shareholding was realised for cash in June 2007.
SHF was a related party through the common directorship of Tony Drury, who was a director of the Company until his resignation on 30 June 2006.
The Company had operating leases for its IT and telephone equipment with SHF and paid £1,950 during the year ended 31 March 2008, and paid £10,890 during year ended 31 March 2007.
On 12 June 2007, the assets which were the subject of the operating leases were bought by the Company for £7,600.
SHF rented certain office space from the Company during year ended 31 March 2008 and paid £2,280.
SHF also rented certain office space from the Company during year ended 31 March 2007 and paid £15,494.
On 29 May 2007 SHF moved to separate offices.
The Company charged SHF £12,000 commission in respect of fundraising during the year ended 31 March 2008, and £2,530 during year ended 31 March 2007.
St Helen's Private Equity PLC ('SHPE')
The Company owned 47,311 shares (3.4%) in SHPE 31 March 2008 and 2007.
SHPE is a related party through common directorship of Jon Pither and Mark Warde-Norbury who are both directors of the Company.
During the year ended 31 March 2008, SHPE paid management fees to the Company of £23,479, and £10,133 during year ended 31 March 2007. This arrangement ceased on 29 February 2008.
With effect from 1 March 2008, SHPE paid an accommodation charge of £1,667.
During the year ended 31 March 08 the Company received £25,000 commission on sale of certain available for sale investments (2007: £nil).
During the year ended 31 March 2008 the Company acquired no options over the ordinary shares in SHPE as payment of fees in respect of fundraising, and it acquired 20,619 options during year ended 31 March 2007. The options have an exercise price of 100pence and at 31 March 2008 the quoted price of SHPE's shares was 70pence per share.
At 31 March 2008 the Company owed SHPE £912 (2007 £nil).
Equity Resources PLC ('ER') (formerly Franchise Investment Strategies PLC)
The Company owned 280,000 shares (0.6%) in ER at 31 March 2008 and 31 March 2007.
ER is a related party through common directorship of Jon Pither who is a director of the
Company.
The Company charged ER £10,000 for other services rendered during the years ended 31 March 2008 and 31 March 2007.
Creative Entertainment PLC ('CE')
The Company owned 120,000 shares (0.1%) in CE at 31 March 2008 and 2007.
CE is a related party through common directorship of Jon Pither who is a director of the Company.
The Company charged CE £5,087 for other services during theyear ended 31 March 2008 (2007:£5,000).
CE owed the Company £3,231 at 31 March 2008 (2007: £nil).
The Company disposed of 550,000 Share Options in CE during the year for a consideration of £2,063 (2007: £nil).
Companies in whom the Company holds no investment which have paid fees to, or charged the Company for, services.
Bonhote Foster Agencies Ltd ('BFA')
BFA is a related party through common directorship of Mark Warde-Norbury who is a director of the Company.
The Company charged BFA £5,000 for commission in respect of fundraising during the year ended 31 March 2008, and £17,250 during the year ended 31 March 2007.
The Company charged BFA for transaction fees during the year ended 31 March 2008 of £nil (2007 - £10,000).
At 31 March 2008 BFA owed the Company £nil (2007: £4,000).
Surrey Management Services Ltd ('Surrey')
Surrey is a related party through common directorship of Jon Pither who is a Director of the Company.
Surrey charged the Company £6,100 for the services of Mr Pither (2007: £6,000)
The Company owed Surrey £1,762 at 31 March 2008 (2007: £nil)
Flight and Partners Ltd ('Flight')
Flight is a related party through the common directorships of Howard Flight and Mark Warde-Norbury.
The Company charged Flight £3,689 for other services rendered during the year (2007: £nil).
At 31st March 2008 Flight owed the Company £3,750 (2007: £nil).
23. Reconciliation of previously stated financial statements to IFRS accounting policies
Up until 31 March 2007 the Company's Financial Statements were prepared under UK Generally Accepted Accounting Principles ('UK GAAP'). Following admission onto AIM, the accounts to 31 March 2008 are being prepared in accordance with IFRS and International Financial Reporting Interpretations Committee interpretations adopted by the European Union, and with those parts of the Companies Act 1985 applicable to companies reporting under IFRS for the first time. The date of transition to IFRS therefore was 1 April 2006.
Capital and reserves attributable to equity shareholders at 1 April 2007
|
|
|
|
Previously
|
Cumulative
|
Restated
|
|
|
|
|
stated
|
adjustment
|
|
|
|
|
|
(£)
|
(£)
|
(£)
|
|
|
|
|
|
|
|
|
Share capital
|
|
|
957,447
|
0
|
957,447
|
|
Share premium account
|
|
|
326,307
|
0
|
326,307
|
|
Revaluation reserves
|
|
|
422,245
|
(144,302)
|
277,943
|
|
Other reserves
|
|
|
(50,254)
|
55,163
|
4,909
|
|
Retained earnings
|
|
|
(1,072,034)
|
89,139
|
(982,895)
|
|
|
|
|
|
|
|
|
|
|
|
583,711
|
0
|
583,711
|
The £144,302 adjustment reflects the change in accounting policy for 'Trading Investments' for the period to 31 March 2006, as more fully described in Note 2c compared to the previous policy of recognising unrealised gains to the Revaluation Reserve. The £55,163 adjustment reflects the change in accounting policy for 'Share based payments' for new options granted in the year ended 31 March 2005, as more fully described in Note 2k above.
Income statement year ended 31st March 2007
|
|
Previously
|
Adjustment
|
Restated
|
|
|
|
stated
|
in period
|
|
|
|
|
(£)
|
(£)
|
(£)
|
|
|
|
|
|
|
|
Revenue
|
|
871,360
|
0
|
871,360
|
|
Cost of sales
|
|
(61,212)
|
0
|
(61,212)
|
|
|
|
|
|
|
|
Gross Profit
|
|
810,148
|
0
|
810,148
|
|
|
|
|
|
|
|
Administrative expenses
|
|
(1,431,174)
|
15,469
|
(1,415,705)
|
|
|
|
|
|
|
|
Operating profit
|
|
(621,026)
|
15,469
|
(605,557)
|
|
|
|
|
|
|
|
Investment revenues
|
|
147
|
0
|
147
|
|
Other gains and losses
|
|
(26,059)
|
64,991
|
38,932
|
|
Finance costs
|
|
(10,657)
|
0
|
(10,657)
|
|
|
|
|
|
|
|
Profit before tax
|
|
(657,595)
|
80,460
|
(577,135)
|
|
|
|
|
|
|
|
Taxation
|
|
0
|
0
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit/ (loss) for the period
|
|
(657,595)
|
80,460
|
(577,135)
|
|
|
|
|
|
|
|
Earnings per share
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
(3.13p)
|
0.39p
|
(2.74p)
|
|
|
|
|
|
|
|
Diluted
|
|
(3.13)p
|
0.39p
|
(2.74p)
|
The £15,469 adjustment reflects the change in accounting policy for 'Share based payments', re options now lapsed, as more fully described in Note 2k above.
The £64,991 adjustment reflects the change in accounting policy for 'Financial Instruments', more fully described in Note 2c above. £66,310 relates to 'Available for Sale Investments, and a loss of £1,319 to 'Trading Investments'.
|
|
|
Previously
stated
(£)
|
Adjustment
in period
(£)
|
Prior period
adjustment
|
Restated
(£)
|
|
|
|
|
|
|
|
|
Share capital
|
|
1,366,085
|
0
|
0
|
1,366,085
|
|
Share premium account
|
|
408,432
|
0
|
0
|
408,432
|
|
Revaluation reserves
|
|
293,230
|
1,319
|
(144,302)
|
150,247
|
|
Other reserves
|
|
66,122
|
(15,469)
|
55,163
|
105,816
|
|
Retained earnings
|
|
(1,663,319)
|
14,150
|
89,139
|
(1,560,030)
|
|
|
|
|
|
|
|
|
|
|
470,550
|
0
|
0
|
470,550
|
Adjustments in the period comprise the adjustments referred to above for the 2007 Income Statement. Prior period adjustments relate to the adjustments as at 1 April 2007 which are also summarised above.
The changes in accounting policies described above (following the conversion to IFRS) have had no cash-flow impact.
|
