| Tue 3 Jul 2007, 15:50 | | LAF - Lonrho Plc - Interim results for the six mon |
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LAF
LOLAF
LAF - Lonrho Plc - Interim results for the six months ended 31 March 2007
Lonrho Plc
(formerly Lonrho Africa Plc)
(Incorporated and registered in England and Wales)
(Registration number 2805337)
(Share code: LAF; ISIN number: GB0002568813)
("Lonrho" or "the Company")
INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 MARCH 2007
Lonrho (AIM: LONR), the African conglomerate with a diverse portfolio of
investments ranging from infrastructure, transportation, support services, and
natural resources announces its interim results for the six months ended 31
March 2007.
Operational Highlights
Since the year end the Company has continued to implement the clear mandate that
was agreed at the Extraordinary General Meeting on 24 February 2006. Lonrho is
building a Group that operates throughout Africa focusing on the core business
opportunities of infrastructure, transportation, support services and natural
resources that offer significant potential for growth across the continent.
Transportation:
Five Forty Aviation Limited ("Fly540"): acquired 49% and Board control of
Fly540, which has subsequently grown to become one of the largest low cost
airlines in East Africa. The company operates French ATR 42-320 turbo-prop 42
seat passenger aircraft. Further regional expansion is planned with the recent
addition of Dash 8-100 turbo-prop aircraft.
Norse Air Limited ("Norse Air"): acquired 43% and Board control of Norse Air, a
charter and leasing business which operates contracts for Governments and
businesses throughout Africa.
Lonrho Air (BVI) Limited: 100% owned by Lonrho, the company has agreed to
acquire two French made ATR 42-320 aircraft which will be leased to Fly540.
Angolan Airline: Lonrho has signed an exclusive Memorandum of Understanding to
develop a new airline in Angola for the passenger, freight, leasing and charter
markets.
Infrastructure:
Luba Freeport Limited ("Luba Freeport"): acquired 63% of Luba Freeport in The
Gulf of Guinea which is perfectly located to service the growing Gulf of Guinea
oil and gas sector. The company is expanding the extension of the port`s quay
and is building a 60,000m2 new facility to accommodate ExxonMobil and other
subcontractors and service companies arriving in or relocating to Luba.
Support Services:
Hotel Cardoso SARL ("Hotel Cardoso"): Lonrho owns 59% of Hotel Cardoso in
Mozambique which posted its best trading for eight years. Lonrho has committed
to upgrade and further develop the property this year and is reviewing a number
of other potential hotel acquisitions in Mozambique and elsewhere in Africa.
Swissta Holding Limited ("Swissta Holdings"): acquired 100% of Swissta Holdings,
a water technology company that builds and operates modular water bottling
plants which will be rolled out across the continent.
Sociedade de Aguas de Mocambique, Lda ("Aguas de Mozambique"): agreed to aquire
34% of Aguas de Mozambique, the extractor, bottler and distributor of mineral
water.
Lonrho Springs: this new division of Lonrho has been established to apply the
Swissta model of water bottling across Africa.
Countermine Plc ("Countermine"): acquired 1.28% and entered into a joint venture
with Countermine to evaluate landmine clearance opportunities in Sub-Saharan
Africa. It is planned that the first site test of the Oracle 2 mine clearance
machine will take place later this year.
Sociedade Comercial Bytes & Pieces, Limitada: agreed to acquire 65% of one of
Mozambique`s largest information technology solution providers which offers
network solutions and maintenance support to busineses, NGO`s and Government
organizations. Lonrho plans to expand into other African countries.
Natural Resources:
Nare Diamonds Limited ("Nare Diamonds"): acquired 21.45% of Nare Diamonds which
has a strong inferred resource at Schmidtsdrift in South Africa and cash
positive operations.
Brinkley Mining Plc ("Brinkley Mining"): acquired 3.91% but despite the current
strong market for uranium Lonrho does not believe that this minority investment
fits strategically with its investment plans and as such reduced its investment
from 10.04%.
Consolidated Africa Mining Plc: acquired 6.71% in this mining resource
investment company with activities in the Cameroon.
SouthWest Energy (BVI) Limited: acquired 2.41% in this oil and gas exploration
company with activities in Ethiopia.
The Company announced its intention to change its name to Lonrho Plc from Lonrho
Africa Plc to capitalise on the character and strength of the Lonrho brand in
Africa.
Financial Review
The financial results for the six months ended 31 March 2007 reflect the fact
that the increase in acquisitions has led to an operating loss of GBP3.0m (2006:
GBP0.9m). However, the Company has seen an increase in turnover from GBP0.6m as
at 31 March 2006 to GBP10.4m for the six month period to 31 March 2007. The
Company`s share price has also performed positively with a rise of 51% from 1
October 2006 to date.
In May 2007 the Company issued 51,449,381 ordinary shares of 1p each at a price
of 32p per share, raising GBP16.46m. Currently, Lonrho has GBP16.7m cash at bank
and in addition holds shares in Nare Diamonds and Brinkley Mining, which are
publicly traded and can be realised at market value.
David Lenigas, Executive Chairman and Chief Executive commented:
"The implementation of the new strategy has allowed Lonrho to become strongly
acquisitive with a number of key investments being made in the African
infrastructure and transport sectors. We are building a portfolio of assets that
when restructured and developed offer significant growth potential and synergy
with positive exposure to a number of key African markets. We are well on our
way to rebuilding Lonrho`s presence in Africa, with a new vision and a new
focus."
"We are committed to improving the business climate of Africa and strongly
believe that our current agenda puts us in an excellent position to contribute
to African growth as one of the world`s most promising emerging markets."
"Our goals are two fold and interlinked: to create value for shareholders and to
stimulate the growth of the African economy."
Enquiries:
Lonrho +44 (0) 20 7016 5105
David Lenigas, Chief Executive +44 (0) 7881 825 378
Emma Priestley, Executive Director +44 (0) 7867 785 177
Pelham PR
Charles Vivian +44 (0) 20 7743 6672
+44 (0) 7977 297 903
James MacFarlane +44 (0) 20 7743 6375
+44 (0) 784 167 2831
Collins Stewart Limited +44 (0) 20 7523 8700
NomAd - Simon Atkinson +44 (0) 20 7523 8350
Broker - Paul Compton +44 (0) 20 7523 8426
Chairman`s Statement
Since the year end the Company has continued to implement the clear mandate that
was agreed at the Extraordinary General Meeting on 24 February 2006. Lonrho is
building a Group that operates throughout Africa focusing on the core business
opportunities of infrastructure, transportation, support services and natural
resources that offer significant potential for growth across the continent.
The importance of infrastructure in Africa is vital to its future economic
growth. For this reason Lonrho`s focus is with investing in infrastructure
related businesses throughout Africa. The underdeveloped nature of the
continent`s infrastructure presents Lonrho with a significant business
opportunity across a range of sectors and geographical regions. Africa is a
burgeoning society that will only become viable through economic growth. The
basic infrastructure must be put in place to facilitate economic growth that
will support trade via ports, transportation and support services. Through the
development of these fundamentals Africa will emerge as a major participant in
the global markets.
During this period we have achieved major accomplishments by investing in
African business within the core sectors. The Company has seen an increase in
turnover from GBP0.6m as at 31 March 2006 to GBP10.4m for the six month period
to 31 March 2007. The Company`s share price has also performed positively with a
rise of 51% from 1 October 2006 to date.
FINANCIAL POSITION
In May 2007 the Company issued 51,449,381 ordinary shares of 1p each at a price
of 32p per share. At the date of this report the Company held GBP16.7m cash at
bank.
CHANGE OF NAME
On the 10 May 2007, Lonrho Africa Plc formally changed its name to Lonrho Plc to
capitalise on the character and strength of the Lonrho brand in Africa.
MANAGEMENT
In order to support this rapid progress, and ensure that the correct corporate
structure and governance is in place, we have expanded the management
capabilities of the Company, and have recruited a new Finance Director, Jean
Ellis, and a new Chief Operating Officer, Geoffrey White. Both bring extensive
experience of operating in the African marketplace.
Jean Ellis is a Chartered Accountant and Chartered Tax Adviser, and holds an
Insolvency Practioner`s licence. Whilst undertaking the role of Finance
Director, she will remain as a partner in the regional firm of Chartered
Accountants, Duncan Sheard Glass, a role she has held since 2002. Prior to this
she was Group Financial Controller and Tax Manager with the Company and holds a
number of directorships for its subsidiary companies.
Geoffrey White has held senior management roles with Thomas Tilling Plc, BTR Plc
and Dee Corporation Plc. During the past four years he has worked for the
private office of His Highness Sheikh Khalifa Al Thani, the Ex-Emir of Qatar, in
London. He has worked with Hilton International, Ford Motors (PAG), Praton
International GmbH, FFS Refiners (Pty) Ltd, Sengamines Sarl, Oryx Natural
Resources, African Mining Investments Limited and Pegasus Energy Limited.
Gerard Holden, who was the joint Chairman of the Company resigned in March 2007
to spend more time on his other business commitments. He remains available to
the Company on specific projects as and when deemed appropriate.
Donald Strang was appointed as a Non-Executive Director on 19 December 2006. He
is a Chartered Accountant with over 15 years experience in financial management
predominantly within the natural resources sector. He is currently an Executive
Director of Brinkley Mining Plc.
REVIEW OF OPERATIONS
A review of the current business profile can be demonstrated in four key
activity areas:
TRANSPORTATION
Five Forty Aviation Limited ("Fly540") (49% investment)
Lonrho has, together with its partners in Nairobi, established the first low
cost airline in East Africa, Fly540. This pioneering company has grown rapidly
and is now the second largest passenger carrier in Kenya behind the national
airline. Fly540 is providing domestic services throughout Kenya, which also
offer practical feed and connectivity for intercontinental airlines flying into
the Nairobi hub. Nairobi continues to build on its historic strength as Africa`s
most logical aviation interchange having an ideal geographic and regional
location.
Firm plans are in place for regional and pan African expansion with further
aircraft under evaluation to meet Fly540`s growth strategy which include up to
four new regional destinations by Q4 2007. The present fleet consists of two
French manufactured ATR 42-320 aircraft and two Dash 8-100 aircraft offering 46
and 37 seat capacities.
Fly540 is 49% owned by Lonrho and 51% by the management of the company. Lonrho
controls the board.
Norse Air Limited ("Norse Air") (43% investment)
Norse Air is a charter, leasing and maintenance company that operates from a
base in South Africa. Lonrho owns a 43% stake in Norse Air and holds Board
control. The company has grown significantly since becoming part of the Lonrho
Group and provides charter and leasing services to a wide range of clients
including the South African Government and AngloGold Ashanti, for whom Norse Air
provides a regular contracted schedule service for transporting its staff and
equipment to its international mine sites.
Lonrho Air (BVI) Limited ("Lonrho Air") (100% investment)
In June 2007 Lonrho Air agreed to acquire two French made ATR 42-320 aircraft
and entered into a back-to back lease purchase agreement whereby the aircraft
are leased on a dry lease basis to Fly540.
Angolan Airline
In June 2007 Lonrho signed an exclusive Memorandum of Understanding with one of
the largest internal investment companies in Angola to develop a new airline in
Angola for the passenger, freight, leasing and charter markets.
Lonrho is constantly evaluating further opportunities in the transport business,
including further aviation markets, shipping, road and rail opportunities that
would expand or bring synergistic business value to the current portfolio.
INFRASTRUCTURE
Luba Freeport Limited ("Luba Freeport") (63% investment)
The Gulf of Guinea has become a significant source of the world`s oil supplies.
The United States of America has announced that it expects to source 25% of its
annual oil requirements from this region within the next five years due to the
significantly lower political risk for the Gulf of Guinea when compared with the
Middle East.
Luba Freeport is owned 63% by Lonrho and 37% by the Government of Equatorial
Guinea and is perfectly located to service the growing Gulf of Guinea oil and
gas sector. Anchor tenants who are utilising the port for their operations
include ExxonMobil, Schlumberger, Baker Hughes, MI Fluids, Nalco, Marathon,
Noble Energy and Amerada Hess. ExxonMobil, already in production and producing
250,000 barrels of crude a day from the Gulf of Guinea, has a ten year contract
at Luba Freeport and is expanding its facility to 60,000 square metres, which is
due for completion in August this year. The Freeport business grows monthly as
subcontractors and service companies arrive or relocate to Luba to support their
largest clients.
To meet the growing demand for ship movement and access at the port, two quay
extensions are being implemented. The first, a US$10.38m contract, is being
built by Danish marine specialists Pihl and will extend the current quay by a
further 70 metres. This expansion has commenced and is on budget and scheduled
to be completed by October 2007. The second phase of extension, a further 110
metres of quay, is planned to commence in November 2007.
Lonrho is assessing various other infrastructure projects throughout Africa in
the port and airport sectors.
SUPPORT SERVICES
Hotel Cardoso SARL ("Hotel Cardoso") (59% investment)
The Hotel Cardoso has gone from strength to strength since it was decided to
retain the property and management has been empowered to focus on improving and
expanding the hotel. Hotel Cardoso has seen significant increases in occupancy
levels and revenue per available room has risen by more than 50% over the last
18 months.
The hotel is to undergo a US$1.5m refurbishment in the latter part of 2007 to
modernise the rooms and the exterior of the building to position it as the
destination hotel of choice in the Maputo market.
Swissta Holdings Limited ("Swissta Holdings") (100% investment)
In April 2007, Lonrho acquired 100% of the water technology company Swissta
Holdings. This provided a building block of tried and tested modular technology
for entering the African bottled water market. This technology and the modular
concept facilitates the rapid growth of a water bottling network throughout
Africa utilising the same technology and business model on a repeat basis from
country to country. The company has a 100% owned water bottling and distribution
operation in Mozambique and a 22% share of a plant in the Democratic Republic of
the Congo.
Sociedade de Aguas de Mocambique, Lda ("Aguas de Mozambique")
In April 2007 Lonrho agreed to acquire a 34% interest in Aguas de Mozambique
which is an extractor, bottler and distributor of mineral water, whose principal
brand, Agua de Namaacha, currently has an overall share of approximately 30% in
the Mozambique water market.
Lonrho Springs
A new division, Lonrho Springs, has been established to apply the Swissta model
of water bottling plants across Africa.
Countermine plc ("Countermine") (1.28% investment)
Lonrho entered into a joint venture with Countermine to evaluate landmine
clearance opportunities in sub-Saharan Africa. Land mines remain a severe
problem in Africa, with an estimated 15,000 to 20,000 new casualties every year
and an estimated 40,000,000 uncleared landmines.
The Oracle 2 is the result of a seven year test and development process that has
resulted in a state of the art landmine clearance machine. The machine
facilitates the faster, safer and less expensive removal of all types of
landmines. It is planned to establish a first site test in conjunction with the
Government in Angola later in 2007.
It is estimated that in Angola alone there are approximately 2,900 suspected
landmine areas covering a total area of some 1,300 to 1,400 square kilometres.
The presence of two or three landmines or even the suspicion of their presence
can result in a large patch of land being avoided and left derelict.
Sociedade Comercial Bytes & Pieces, Limitada ("Bytes & Pieces")
In June 2007, Lonrho agreed to acquire 65% of one of Mozambique`s largest
commercial Information Technology Solution Providers, Bytes & Pieces, which
provides turnkey network solutions and maintenance support to Mozambique
businesses, NGO`s and Government Organisations.
Upon completion of the acquisition, Lonrho plans to expand into other countries
in Africa using the Bytes & Pieces model with a distribution division for high
quality networking products.
NATURAL RESOURCES
Nare Diamonds Limited ("Nare Diamonds") (21.45% investment)
Nare Diamonds is an Australian listed company of which Lonrho currently owns
21.45% (19.05% at 31 March 2007) and is the largest single shareholder.
Operationally the company has a strong inferred resource at Schmidtsdrift in
South Africa, and the recent investment in new earth moving equipment is
beginning to show in the results. The operations are now cash positive, and it
is expected that this will develop further as better mining procedures and more
earth moving equipment comes on line in the latter part of 2007. Inferred
resources have been increased to 47.7 million tonnes and the mine is now
producing an average grade of 0.51 carats per hundred tonnes. This is forecast
to improve when the new final treatment and recovery plant is commissioned in
August 2007.
The sale of product has been taken out of a previous exclusive sale contract,
and it is envisaged that this will result in a rise of up to 20% in revenue from
tenders.
Brinkley Mining Plc ("Brinkley Mining") (3.91% investment)
Brinkley Mining was one of Lonrho`s first acquisitions. The current market for
uranium and uranium prospecting companies remains strong, however, Lonrho has
developed its own market strategies moving forward, and does not believe a
minority investment in companies such as Brinkley is strategically fitting with
Lonrho`s investment plans. The stake in Brinkley has been reduced from 10.04% to
3.91%.
Consolidated Africa Mining Plc ("Consolidated Africa Mining") (6.71% investment)
During the period the Group invested GBP0.4m in Consolidated Africa Mining, a
mining resource investment company with activities in Cameroon.
SouthWest Energy (BVI) Limited ("SouthWest Energy") (2.41% investment)
Since the period end the Group invested US$1.0m in SouthWest Energy, an oil and
gas exploration company with activities in Ethiopia.
David Lenigas
Executive Chairman & Chief Executive
29 June 2007
Consolidated profit and loss account
6 months 6 months 6 6 months 12
months months
to 31.3.07 to to to to
31.3.07 31.3.07 31.3.06 30.9.06
Continuing
operations Acquisi- Total Total Total
tions
As As
restated restated
Note GBPm GBPm GBPm GBPm GBPm
Turnover 3.7 6.7 10.4 0.6 3.4
Net operating costs (6.2) (7.2) (13.4) (0.9) (4.3)
Charge in respect of - - - (0.6) (0.8)
share options issued
(See note below)
Operating loss (2.5) (0.5) (3.0) (0.9) (1.7)
Non-operating 2 - - 0.4
exceptional items
Interest payable (0.5) - (0.2)
Interest receivable 0.2 0.4 0.7
Loss on ordinary
activities (3.3) (0.5) (0.8)
before taxation
Taxation - - -
Loss on ordinary
activities (3.3) (0.5) (0.8)
after taxation
Minority interests 0.7 - (0.1)
Loss for the period (2.6) (0.5) (0.9)
Loss per share (1.2) p (0.3) p (0.4) p
Loss per share (1.2) p (0.3) p (0.6) p
before exceptional
items
Earnings per share
Loss per share of 1.2p (2006 as restated - loss 0.3p) has been calculated using
the loss after taxation and minority interest of GBP2.6m (2006 as restated -
loss GBP0.5m) applied to 224,229,090 shares (2006: 157,572,088 shares)
Loss per share excluding exceptional items of 1.2p (2006 as restated - loss
0.3p) has been calculated on the loss after taxation and minority interest but
before exceptional items applied to 224,229,090 shares (2006: 157,572,088
shares)
There is no dilution per share in respect of the current year or preceding year
as the Group has made a loss.
Prior year adjustment
As required under current UK accounting standards, the Group has adopted FRS 20
`Share-based Payment`. The adoption of this standard represents a change in
accounting policy and the comparative figures have been restated accordingly.
The adjustments to previous periods have resulted in an additional charge to the
profit and loss account of GBP0.5m (previously GBP0.1m) in respect of share
options issued in the six months to 31 March 2006 and a further GBP0.2m in
respect of share options issued in the six months to 30 September 2006. A
separate reserve (`Other reserve`) has been created in respect of this charge in
the balance sheet. There has been no change to the net asset value of the Group
in respect of this adjustment.
Group balance sheet
31 March 31 March 30 September
2007 2006 2006
As restated As restated
GBPm GBPm GBPm
Fixed assets
Intangible - goodwill 6.0 - 3.3
Tangible 34.7 2.6 19.8
40.7 2.6 23.1
Current assets
Stocks 0.8 0.3 0.2
Debtors
Amounts falling due 5.5 1.2 2.3
within one year
Investments 6.2 - 7.1
Cash at bank 8.4 20.9 20.7
20.9 22.4 30.3
Creditors: amounts falling due (16.4) (0.8) (13.4)
within one year
Net current assets 4.5 21.6 16.9
Total assets less current 45.2 24.2 40.0
liabilities
Creditors:amounts falling due (6.7) - -
after one year
Provisions for liabilities and 0.2 (2.2) -
charges
Net assets 38.7 22.0 40.0
Capital and reserves
Called up share capital 2.2 1.6 2.2
Share premium 17.4 - 17.4
Merger reserve - 96.1 -
Revaluation reserve 1.6 0.9 1.6
Other reserve (see note below) 0.8 0.6 0.8
Profit and loss account 14.9 (78.3) 17.5
Shareholders` funds 36.9 20.9 39.5
Minority interests 1.8 1.1 0.5
38.7 22.0 40.0
Prior year adjustment
As required under current UK accounting standards, the Group has adopted FRS 20
`Share-based Payment`. The adoption of this standard represents a change in
accounting policy and the comparative figures have been restated accordingly.
The adjustments to previous periods have resulted in an additional charge to the
profit and loss account of GBP0.5m (previously GBP0.1m) in respect of share
options issued in the six months to 31 March 2006 and a further GBP0.2m in
respect of share options issued in the six months to 30 September 2006. A
separate reserve (`Other reserve`) has been created in respect of this charge in
the balance sheet. There has been no change to the net asset value of the Group
in respect of this adjustment.
Consolidated cash flow statement
6 6 12
months months months
to to to
31.3.07 31.3.06 30.9.06
Note GBPm GBPm GBPm GBPm GBPm GBPm
Net cash flow from
operating activities
- continuing operations (0.6) 0.2 (0.5)
- acquisitions (0.3) - 0.5
1 (0.9) 0.2 -
Return on investments
and servicing of
finance
- interest received 0.2 0.4 0.7
- interest paid (0.3) - -
Net cash (1.0) 0.6 0.7
(outflow)/inflow before
investing activities
Purchasing of tangible (9.5) - (1.8)
fixed assets
Purchase of investments (2.6) - (7.1)
Sale of investments 3.5 - -
Loan advance received 1.9 - -
Loan repayment (0.6) - (0.2)
Net cost of acquisition (3.9) - (1.7)
of subsidiaries
Loan paid on - - (6.1)
acquisition of
subsidiary
Bank overdraft acquired (0.1) - (0.1)
with subsidiary
Net costs from - - (1.8)
closure/disposal of
subsidiaries
Net proceeds from sale - - 0.4
of properties
Share issue - - 18.0
(Decrease)/Increase in (12.3) 0.6 0.3
cash
Movement in net cash
for the six months to 31 March 2007
1 October Net cash 31 March
2006 flows 2007
GBPm GBPm GBPm
Cash 20.7 (12.3) 8.4
Statement of total recognised gains and losses
6 months 6 months 12 months
to 31.3.07 to 31.3.06 to 30.9.06
As restated As restated
GBPm GBPm
GBPm
Loss for the period (2.6) (0.5) (0.9)
Increase arising on revaluation - 0.1 0.9
of assets
Exchange adjustments - (0.1) (0.1)
Total recognised gains and (2.6) (0.5) (0.1)
losses in the period
Reconciliation of movements in shareholders` funds
6 months 6 months 12 months
to 31.3.07 to 31.3.06 to 30.9.06
As restated As restated
GBPm GBPm GBPm
Recognised gains and losses
relating to the period (2.6) (0.5) (0.1)
Shares issued in the period - - 18.0
Credit in respect of share - 0.6 0.8
options
Net (decrease)/increase in (2.6) 0.1 18.7
shareholders` funds
At beginning of period 39.5 20.8 20.8
At end of period 36.9 20.9 39.5
Historical cost profits and losses
6 months 6 months 12 months
to 31.3.07 to 31.3.06 to 30.9.06
As restated As restated
GBPm GBPm GBPm
Historical cost loss before
taxation
Reported loss before taxation (3.3) (0.5) (0.8)
Historical cost loss after (2.6) (0.5) (0.9)
taxation and minority interest
Basis of preparation of the interim financial information
With the exception of the adoption of FRS 20 `Share-based Payment` which is
discussed in detail below, the interim financial information has been prepared
on the same basis and using the same accounting policies as were applied in
drawing up the statutory accounts for the year ended 30 September 2006. The
figures for the six months to 31st March 2007 and 31st March 2006 are unaudited.
The comparative figures for the financial year ended 30th September 2006 are not
the Group`s statutory accounts for that year. Those accounts have been reported
on by the Group`s auditors and delivered to the registrar of companies. The
report of the auditors was (i) unqualified, (ii) did not include a reference to
any matters to which the auditors drew attention by way of emphasis without
qualifying their report and (iii) did not contain a statement under section 237
(2) or (3) of the Companies Act 1985.
Prior year adjustment
As required under current UK accounting standards, the Group has adopted FRS 20
`Share-based Payment`. The adoption of this standard represents a change in
accounting policy and the comparative figures have been restated accordingly.
The adjustments to previous periods have resulted in an additional charge to the
profit and loss account of GBP0.5m (previously GBP0.1m) in respect of share
options issued in the six months to 31 March 2006 and a further GBP0.2m in
respect of share options issued in the six months to 30 September 2006. A
separate reserve (`Other reserve`) has been created in respect of this charge in
the balance sheet. There has been no change to the net asset value of the Group
in respect of this adjustment.
Notes to the half year accounts
1. Consolidated cash flow statement
6 months 6 months 6 6 months 12
months months
to 31.3.07 to 31.3.07 to to to
31.3.07 31.3.06 30.9.06
Continuing
Operations Acquisitions Total Total Total
As As
restated restated
Net cash flow Note GBPm GBPm GBPm GBPm GBPm
from
operating
activities
Operating loss (2.5) (0.5) (3.0) (0.9) (1.7)
for the period
Depreciation 0.6 0.1 0.7 0.1 0.3
charge
Amortisation 0.1 - 0.1 - 0.1
Charge in - - - 0.6 0.8
respect of share
options granted
Increase in - (0.3) (0.3) - -
stocks
(Increase)/decre (0.1) (2.3) (2.4) 0.4 0.2
ase in debtors
Increase in 1.3 2.7 4.0 - 0.3
creditors
Net cash
(outflow)/inflow (0.6) (0.3) (0.9) 0.2 -
from operating
activities
6 months 6 months 12 months
to 31.3.07 to 31.3.06 to 30.9.06
Reconciliation of net cash flow GBPm GBPm GBPm
to movement in net borrowings
(Decrease)/increase in cash in (12.3) 0.6 0.3
the period
Loan acquired on acquisition of (4.7) - (4.2)
subsidiaries
Loan advance received in period (1.9) - -
Loan repayments 0.6 - 0.2
Other non cash 0.1 - (0.2)
Movement in net cash (18.2) 0.6 (3.9)
Balance at beginning of period 16.4 20.3 20.3
Net (debt)/cash (1.8) 20.9 16.4
2. Non-operating exceptionals
6 months 6 months 12 months
to 31.3.07 to 31.3.06 to 30.9.06
Total Total Total
GBPm GBPm GBPm
Profit on disposal of properties - - 0.4
Total - - 0.4
Date: 03/07/2007 15:50:09 Produced by the JSE SENS Department.
