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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
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Avid Holdings | LSE:AVD | London | Ordinary Share | GB00B06GHM23 | ORD 0.5P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
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0.00 | 0.00% | 0.095 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
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0 | 0 | N/A | 0 |
FOR RELEASE 7.00 AM 25 SEPTEMBER 2008 AVID HOLDINGS PLC ("Avid" or the "Company") INTERIM STATEMENT FOR THE PERIOD ENDED 30 JUNE 2008 LOSS SIGNIFICANTLY REDUCED Business Highlights in the Period * Turnover including acquisitions increased by 166.5% from £679,356 to £1,810,723 * Gross profit increased 157.6% from £228,951 to £589,849 * Group loss before tax reduced by 49.8% to £186,292 from £370,937 * Loss per share reduced by 66.7% to 0.04p from 0.12p * Acquisition of Alpha Anodising completed in March * An order for the first 12 electropacTM feeders to Boots received via a German OEM * All operating companies operating profitably before central overheads * Confident of a further improved trading performance for the full year For further information contact: Jonathan Bobbett, Chief Executive Avid Holdings Plc Tel: +44 (0)1622 872 022 http://www.avidholdings.co.uk Ross Andrews, Nominated Adviser Zeus Capital Limited Tel: +44 (0) 161 831 1512 Stephen Goschalk, Stockbroker Newland Stockbrokers Limited Tel: +44 (0) 20 7290 2400 Brian Coleman-Smith / James Verstringhe, Financial Public Relations Cubitt Consulting Limited Tel: +44 (0) 20 7367 5100 Background note Avid focuses on acquiring stable and profitable businesses within the precision engineering sector. As the target sector is highly fragmented the Company strongly believes that value can be added through consolidation. The Group came into being through the acquisition of 3 Point Blue, which was founded by Jonathan Bobbett, the Group's Chief Executive, and was reversed into Euro Investment Fund plc in June 2006 and changed its name to Avid Holdings plc on being admitted to trading on AIM in June 2006. Since then the Company has made two further acquisitions. Pill Protect 3 Point Blue became the first operating company in the emerging Group changing its name to Pill Protect which provides pharmaceutical companies with child resistant and senior friendly packaging solutions for their blister pack drugs. Electro-Mec Electro-Mec, founded in 1969, is a precision engineering business producing high quality blister pack change tooling for the pharmaceutical industry (from which it generates the majority of its revenues) as well as offering some machining and assembly for the defence industry. It was acquired in February 2007 for a total consideration of £1.55 million of which £759,000 is dependent on future profits. Alpha Anodising Alpha was established in 1972 and is a high quality metal finishing business based in Buckinghamshire. It has developed a highly diversified customer base due to its specialised expertise and reputation. Its offerings include a wide range of production techniques such as mechanical and chemical finishes, high quality surface and sub-surface printing, as well as professional design and prototyping services. The company supplies the medical, scientific, defence and audio industries. It was acquired for £799,813 of which £120,000 is deferred. AVID HOLDINGS PLC ("Avid" or the "Company") INTERIM STATEMENT FOR THE PERIOD ENDED 30 JUNE 2008 Chairman's Statement During the period under review Avid has achieved a significant increase in turnover and gross profit through the acquisition of Alpha Anodising and through sustainable organic growth. The results include three months trading from Alpha Anodising, which was acquired in March of this year. The Group continues to develop as a consolidator in the precision engineering sector and, subject to the availability of funding, will seek further acquisitions to contribute to overall group profitability and enhanced long-term shareholder value. I was delighted to welcome Bob Dover, former Chairman and Chief Executive of Jaguar and Land Rover, as a Non Executive Director at the AGM and I am sure that his sector expertise will be invaluable to the Group. Results for the period ended 30 June 2008 The loss before taxation for the period and loss per share amounted to £186,292 (2007: £370,937) and 0.04 pence per share (2007: 0.12 pence per share) respectively. As at 30th June 2008, net assets were £2,843,787 (2007: £ 3,259,066). The Directors do not propose a dividend at this time. In March 2008, as part of the acquisition of Alpha Anodising Ltd, the Group negotiated new banking facilities with HBOS. These arrangements include extensive drawdown facilities and an overdraft which are utilised as required. For this reason, good Treasury Management resulted in a nil cash position on the Balance Sheet at the period end. Operating Review Electro-mec (Reading) Limited Electro-mec is near to completing the industrial version of the electropacTM, a fully automated system for the production of patient packs that can be used for all solid and semi-solid formulations. The electropacTM system uses innovative technology that enables the fully automated filling, in the pharmacy, of weekly dose packs for elderly patients. The equipment has been designed to handle a full range of formulated drugs including tablets, capsules, caplets and gels in varying shapes and sizes. Electro-mec's existing vibration tray technology has been adapted to allow automated filling through seven channels into each day's unit tray. International Patents have been filed and an order received for the first 12 units to be installed at Boots. A smaller desktop machine designed for individual pharmacists is under development with DTI support. Alpha Anodising Limited The acquisition of Alpha Anodising was completed in March adding a valuable income and profit stream to the group. Early indicators are that it is performing slightly above our expectations returning a £40,187 operating profit for the 3 months to 30 June 2008. Factory production is forecast to increase by over 60% with the introduction of an additional shift in the second half of 2008. The anodising work from Electro-mec will take up much of the increased capacity absorbing development costs leading to increased profitability in 2009. Alpha Anodising was selected to anodise a series of tables designed by BarberOsgerby, UK Designers of The Year 2007. The complex design featured up to 60 individual sections of aluminium that Alpha anodised in different colours to the exact specification of the designer. The tables are being exhibited and sold through Established & Sons in Duke Street, London. Pill protect The pharmaceutical industry has been slow to adopt the BS EN14375 regulations. Pill protect continues to supply Reckitt Benkiser with child-resistant blister packaging solutions for a number of their well known brands and revenue continues to grow slowly and make a small contribution to the group. Outlook With the three trading companies successfully integrated and now operating profitably before holding company overheads, I remain confident that the Group will show a further improvement in trading performance at the year end. Michael Walter Chairman CONSOLIDATED INCOME STATEMENT Six months Six months Year end For the period to 30 June 2008 Ended Ended 31 December 30 June 30 June 2007 2008 2007 Audited (Unaudited) (Unaudited) £ £ £ Revenue 1,810,723 679,356 1,746,105 Cost of sales (1,220,874) (450,405) (1,336,499) Gross profit 589,849 228,951 409,606 Administrative expenses (751,455) (593,174) (1,234,709) Operating loss (161,606) (364,223) (825,103) Finance income 15,236 18,866 33,162 Finance expenses (39,922) (25,580) (56,684) Loss before tax (186,292) (370,937) (848,625) Income taxes (note 6) - - 60,058 Loss for the period (186,292) (370,937) (788,567) Basic and diluted loss per share from (0.04)p (0.12)p (0.25)p continuing and total operations (note 2) STATEMENT OF CHANGES IN EQUITY For the period to 30 June 2008 Six months Six months Year end Ended Ended 31 December 30 June 30 June 2008 2007 2007 (Unaudited) (Unaudited) Audited £ £ £ Loss for the financial period (186,292) (370,937) (788,567) Issue of share capital 32,000 1,395,470 1,545,470 Increase in reserve for potential share - 11,244 17,887 issues Net increase in shareholders' equity (154,292) 1,035,777 774,790 Equity at the start of the period 2,998,079 2,223,289 2,223,289 Equity at the end of the period 2,843,787 3,259,066 2,998,079 CONSOLIDATED BALANCE SHEET As at 30 June 2008 As at As at As at 30 June 30 June 31 December 2008 2007 2007 (Unaudited) (Unaudited) (Audited) £ £ £ ASSETS Non-current assets Property, plant and equipment 579,204 505,333 477,557 Goodwill 2,419,106 2,268,745 2,270,544 Other intangible assets 606,803 508,579 521,924 3,605,113 3,282,657 3,270,025 Current assets Inventories 612,255 352,127 407,064 Trade receivables 856,755 331,161 391,330 Other current assets 303,928 129,210 73,333 Cash and cash equivalents - 226,676 96,113 1,772,938 1,039,174 967,840 Total assets 5,378,051 4,321,831 4,237,865 EQUITY AND LIABILITIES Equity attributable to equity holders of the parent Share capital 2,110,334 1,903,334 2,078,334 Share premium 2,383,736 2,408,736 2,383,736 Share to be issued reserve 17,887 11,244 17,887 Retained earnings (1,668,170) (1,064,248) (1,481,878) Total equity 2,843,787 3,259,066 2,998,079 Non-current liabilities Long-term borrowings 517,356 311,570 248,140 Deferred tax 20,496 - 7,452 Total non-current liabilities 537,852 311,570 255,592 Current liabilities Cash and cash equivalents 121,733 - - Trade and other payables 1,190,246 628,318 644,255 Short term borrowings 420,777 - 224,931 Current portion of long-term borrowings 263,656 122,877 115,008 Total current liabilities 1,996,412 751,195 984,194 Total liabilities 2,534,264 1,062,765 1,239,786 Total equity and liabilities 5,378,051 4,321,831 4,237,865 CONSOLIDATED CASH FLOW STATEMENT For the period to 30 June 2008 Six months Six months Year end Ended Ended 31 December 30 June 30 June 2007 2008 2007 Audited (Unaudited) (Unaudited) £ £ £ Cash flows from operating activities Operating loss (161,606) (364,223) (825,103) Adjustments for: Depreciation 41,227 39,002 63,142 Loss on disposal 2,007 - 7,797 Amortisation 16,574 - 20,077 Equity-settled share-based payment - 11,244 - expense Increase in trade and other receivables (474,967) 14,961 10,669 Increase in inventories (98,949) (118,205) (173,142) Increase in trade payables 621,043 (212,187) 79,845 Income taxes - - 14,547 Net cash flows used in operating (54,671) (629,408) (802,168) activities Cash flows from investing activities Acquisition of subsidiary net of cash (410,221) (554,557) (554,557) acquired Purchase of property, plant and equipment (45,679) (254,421) (60,631) Purchase of intangible assets (101,453) - (28,267) Proceeds from sale of equipment 1,000 224,880 21,774 Net cash used in investing activities (556,353) (584,098) (621,681) Cash flows from financing activities Proceeds from issue of share capital - 995,470 1,163,357 Proceeds from long-term borrowings 417,863 215,809 165,066 Payment of debt - - (20,556) Interest received 15,237 18,866 33,162 Interest paid (39,922) (25,580) (56,684) Net cash used in financing activities 393,178 1,204,565 1,284,345 Net increase in cash and cash equivalents (217,846) (8,941) (139,504) Cash and cash equivalents at beginning of 96,113 235,617 235,617 period Cash and cash equivalents/(debt) at end (121,733) 226,676 96,113 of period Note A. Acquisition of subsidiary During the period the Group acquired Alpha Anodising Limited. The fair value of assets acquired and liabilities assumed were as follows: Property, plant and equipment 100,202 Inventories 106,242 Accounts receivable 221,054 Cash 431,015 Trade payables (120,795) Long-term debt (13,044) 724,674 Goodwill 148,562 Total acquisition cost 873,236 Less: Cash and cash equivalents acquired (431,015) Non-cash consideration (32,000) Cash outflow on acquisition 410,221 Notes to the unaudited interim report 1. Basis of preparation While the financial information included in this interim announcement has been computed in accordance with International Financial Reporting Standards (IFRS), this announcement does not itself contain sufficient information to comply with IFRS. The interim financial information has been prepared on the basis of the accounting policies set out in the Company's statutory accounts to 31 December 2007 which were prepared in accordance with IFRS, International Accounting Standards and their interpretations issued or adopted by the International Accounting Standards Board as adopted for use in the European Union. The interim figures have not been audited. The interim financial statement does not constitute statutory accounts within the meaning of Section 240 of the Companies Act 1985 (the "Act"). Comparative financial information for the 12 months ended 31 December 2007 has been extracted from the statutory accounts for the period which have been delivered to the Registrar of Companies and upon which the auditors gave an unqualified report, with no statement under Section 237(2) or (3) of Act. 2. Earnings per ordinary share The calculation of basic earnings per ordinary share is based on the result for the period, for continuing operations as well as total acquisitions, and the weighted average number of shares in issue during the period. Six months Six months Year ended to to 31 December 30 June 30 June 2007 2008 2007 Weighted average number of ordinary 418,848,985 309,203,702 345,108,057 shares in issue Dilutive potential ordinary shares: - 10,104,545 4,480,812 Employee share options Loss after tax (£) (186,292) (370,937) (848,625) Basic earnings per share - pence per (0.04p) (0.12p) (0.39p) share (p) There are no potentially dilutive employee share options in existence at 30 June 2008 (30 June 2007: 10,104,545) which relate to share options granted to employees where the exercise price is less than the average market price of the Company's ordinary shares during the period. 3. Business Combination On 27th March 2008 Avid Holdings plc completed the purchase of the entire share capital of Alpha Anodising Limited for initial consideration of £679,813. This consisted of a cash payment of £647,813 and the issue of 6,400,000 new Ordinary Shares in Avid Holdings plc at a price of 0.5 pence. Deferred cash consideration of up to £120,000 will be due dependent on the future profits of Alpha Anodising. The Board of Directors have considered the likelihood that the future profits of Alpha Anodising will reach the necessary levels for this to become payable and have made a provision of £80,000 based on expected results. It is anticipated that profits will not reach the necessary levels for the full deferred consideration to be payable and no provision, therefore, for the additional £40,000 has been made. The book value of the acquisition can be found in Note A of this report. In addition, directly attributable costs of £193,423 were incurred in relation to the business combination. 4. Segmental Reporting The Group's core activities are the supply of specialist packaging solutions and the production of precision tooling both for the pharmaceutical industry as carried out by the subsidiary companies. There are no geographical segments. Six months ended Six months Year 30 June ended ended 2008 30 June 31 December £ 2007 2007 £ £ Revenue Packaging solutions 155,740 18,945 121,148 Precision tooling 1,328,361 656,861 1,620,757 Metal finishing 326,222 - - Group activities 400 3,550 4,200 1,810,723 679,356 1,746,105 Profit Packaging solutions 7,461 (183,723) (215,305) Precision tooling 113,113 (1,312) (219,761) Metal finishing 40,187 - - Group activities (322,367) (179,188) (390,037) Underlying operating loss (161,606) (364,223) (825,103) Finance income 15,236 18,866 33,162 Finance expenses (39,922) (25,580) (56,684) Loss for the period (186,292) (370,937) (848,625) 5. Due to the Company's losses, no taxation charge has arisen for the period. 6. The Directors have not declared an interim dividend. 7. The financial statements for the six months ended 30 June 2008 were approved by the Board of Directors on 24 September 2008. These financial statements do not constitute statutory accounts within the meaning of the Companies Act 1985 and are neither reviewed nor audited. 8. Copies of this statement are available to shareholders and members of the public, free of charge, from the Company's registered office at Unit 10 Woodfalls Farm, Gravelly Way, Laddingford, Kent, ME18 6DA. Michael Walter Chairman END
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