ADVFN Logo

We could not find any results for:
Make sure your spelling is correct or try broadening your search.

Trending Now

Toplists

It looks like you aren't logged in.
Click the button below to log in and view your recent history.

Hot Features

Registration Strip Icon for default Register for Free to get streaming real-time quotes, interactive charts, live options flow, and more.

HST Hartstone

0.00
0.00 (0.00%)
Share Name Share Symbol Market Type Share ISIN Share Description
Hartstone LSE:HST London Ordinary Share GB0003703500 ORD 1P
  Price Change % Change Share Price Shares Traded Last Trade
  0.00 0.00% 0.00 -
Bid Price Offer Price High Price Low Price Open Price
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
  -
Last Trade Time Trade Type Trade Size Trade Price Currency
- 0 GBX

Hartstone (HST) Latest News

Real-Time news about Hartstone (London Stock Exchange): 0 recent articles

Hartstone (HST) Discussions and Chat

Hartstone Forums and Chat

Date Time Title Posts
05/5/200415:32Hartstone group.... 10 bagger or lose the lot !435
30/4/200416:16Hartstone ( HST A Speculative Buy at 1.25p )147
27/2/200408:33SUB-PENNY STOCK DUE SUBSTANTIAL RISE !99
24/10/200313:37QUESTION!33
17/6/200309:28Hartstone results14

Add a New Thread

Hartstone (HST) Most Recent Trades

No Trades
Trade Time Trade Price Trade Size Trade Value Trade Type

Hartstone (HST) Top Chat Posts

Top Posts
Posted at 30/4/2004 16:16 by maut too
CAS Hartstone : Gets Wooster bid
30-Apr-2004 17:08

The boards of Wooster Investments and
The Hartstone Group have reached
agreement on the terms of recommended
cash offers to be made by Hawkpoint on
behalf of Wooster, for the entire
issued and to be issued ordinary share
capital and preference share capital of
Hartstone not already held or
controlled by Wooster.
The Ordinary Offer will be 2p in cash
for each Ordinary Share, which values
the existing issued ordinary share
capital of Hartstone at approximately
#3.2m.
The Ordinary Offer represents: a
premium of approximately 13.0%. over
the closing middle market price of
1.77p per Ordinary Share on Apr. 29,
2004; - a premium of approximately
25.0%. over the closing middle market
price of 1.60p per Ordinary Share on
Mar. 17, 2004; a premium of
approximately 58.7%. over the average
closing middle
market price of 1.26p per Ordinary
Share for the three month period to
Mar. 17, 2004.
The Preference Offer will be 95p in
cash for each Preference Share, which
values the existing issued preference
share capital of Hartstone at
approximately #9.5m.
The Preference Offer represents: a
premium of approximately 27.5%. over
the closing middle market price of
74.50p per Preference Share on Apr. 29,
2004; a premium of approximately 53.2%.
over the closing middle market price of
62.00p per Preference Share on Mar. 17,
2004; and - a premium of approximately
72.3%. over the average closing middle
market price of 55.13p per Preference
Share for the three month period to
Mar. 17, 2004.
In aggregate, the Offers value the
existing issued ordinary and preference
share capital of Hartstone at
approximately #12.7m.
Wooster has today acquired 32,622,613
Ordinary Shares and consequently now
holds approximately 20.6%. of
Hartstone's existing issued ordinary
share capital.
In addition, Wooster has obtained
irrevocable undertakings to accept the
Preference Offer from institutional
investors in respect of 4,541,000
Preference Shares, representing
approximately 45.4%. of Hartstone's
existing issued preference share
capital. A holder of a further 831,496
Preference Shares has indicated its
intention to accept the Preference
Offer.
The Hartstone Directors have also
irrevocably undertaken to accept or
procure acceptance of the Offers in
respect of their own and their
immediate families' entire beneficial
holdings amounting to 11,550,034
Ordinary Shares and 375,026 Preference
Shares, representing approximately
7.3%. and 3.8%. of Hartstone's existing
issued ordinary and preference share
capital, respectively.
The Offers are conditional, inter
alia, on Hartstone Shareholders
approving resolutions to amend the
rights of the Preference Shares.
Tony Cheng, a director of Wooster,
said: "Whilst Hartstone has clearly had
a difficult time in recent years, we
believe that it can prosper under our
ownership."
Commenting on the Offers, Shaun
Dowling, Chairman of Hartstone, said:
"After a number of years of attempts to
sell our Aigner business, shareholders
now have an opportunity to realise cash
for their shares at a significant
premium to recent market prices, which
I shall do myself."

ICV Edited News from Dow Jones
1608 GMT Apr 30 2004
Posted at 18/4/2004 19:13 by sambuca
If you get a letter from Keirgroup holdings asking if you want a research report on HST just sign on the dotted line and return in the pre paid envolope read this first (copied from the FSA website under the heading of "share scams")

It is not on the FSA register so they might be all above board but they might not!

Share scams

The Catch

Sounds obvious but if a stranger rings you out of the blue and tries to sell you shares in companies you've probably never even heard of - TAKE CARE! They may be part of a financial scam using hard-sell tactics to persuade you to buy shares. If they end up persuading you to buy, they'll be the ones laughing all the way to the bank. And you may be left with potentially worthless shares and no rights to complain or claim compensation from the UK schemes.

But surely financial scams would be closed down immediately by the regulator? Well, yes they would if we found they were operating from within the UK. Firms selling shares have to apply for a licence and abide by rules designed for your protection, otherwise they're not operating lawfully. BUT WATCH OUT! These rules are not identical abroad. Financial scams based overseas are able to communicate with anyone anywhere in the world and could be targeting UK investors.

The first time you hear from such firms could be by post or e-mail, or they might advertise their services over the internet. They may offer you a free research report into a company in which you hold shares, or a free gift or a discount on their dealing charges.

The scenario may follow this pattern. You'll probably be an investor in smaller companies (often called penny shares). Therefore, your name will have appeared on the share register of the company you've invested in - which anyone can get hold of. Then surprise surprise, you'll receive a mailshot making you a great free offer. Sign on the dotted line and you'll receive a free, independent research report outlining future prospects for the company.

"Nothing to lose" you think. "And it's free". So you sign on the dotted line and send your response in the freepost envelope - but don't worry, it must be OK because its got a UK address and so if anything goes wrong, you'll be able to complain.

What you haven't realised is:
By signing on the dotted line, you have probably agreed to be contacted by the firm in the future. This was probably written in the small print of the mailshot.


The UK freepost address on the return envelope may simply be a forwarding address to an overseas address.

What happens next?

You'll start to get flooded with calls offering you a great deal on shares, often in smaller companies you may not have heard of or possibly other investments such as futures, options or foreign exchange. The firm's salesforce will probably sweeten, cajole, flatter, bully and even sometimes threaten you to take up their offer. Don't forget, they probably make a commission on every sale. After buying the shares, you may have difficulty in getting the shares or their certificates. And when you try to sell them, you won't know if the price is fair - or you could find the price is inexplicably lower. If you do manage to persuade the firm to sell your shares for you, you may have difficulty getting the proceeds from the sale or be put under a lot of pressure to buy other shares with the money.

Companies based outside the UK and which are not authorised persons are allowed to advertise their services in the UK, but only if their publicity is approved by an FSA-authorised firm or an exemption applies which allows them to advertise their services without such approval. In the UK, firms are generally not allowed to 'cold-call' potential customers to sell them financial services. If, however, you initiate contact with the firm, a follow-up phone call does not count as a cold call.

How to protect yourself


Always check whether the company is authorised in the UK. Ring the FSA Consumer Helpline 0845 606 1234 (calls charged at local rates) to find out or look at the online FSA Firm Check Service. If it isn't, take care. You probably won't have the right to complain or seek a penny in compensation from the UK regulatory system if things go wrong.


The FSA has published a warning about firms that it is aware of that operate this way.

However, be aware that this type of firm is likely to change its name frequently so if it does not appear on these lists do not assume it is genuine.

If the company is not authorised in the UK, then look carefully to see where the company is registered. Try and check whether the company is in fact regulated in its home country. If it is, try to find out as much as possible about how regulation, ombudsmen and compensation works there.


Financial firms authorised in a country in the European Economic Area (EEA) can offer certain products or services in any other EEA country if they have a 'passport' that entitles them to do so. Such firms will be regulated in their home country and meet standards which have been agreed across all EEA countries. However, if the firm becomes insolvent and you have a claim for compensation, you will need to deal with the relevant authorities overseas.


Read the small print. If you had, you would probably find that you had expressly agreed to receive calls from the company. And even if you think you're immune from such high-pressured selling tactics, you'd be surprised at just how many people give in - simply to get rid of the caller.


If you do decide to go ahead and buy the shares, at least try to check the current price in the financial press or with a broker. These firms may be acting as bucket shops, buying in shares from other brokers. If they do so, you may not pay the market price for the share. Even though they will be trying to get you to make a decision quickly, still try to find time to do your own research before buying - look on the company's website if they have one, get hold of the annual report and read the financial press.


If you decide to go ahead, be aware that it may be difficult to get evidence or confirmation of what shares you hold from the firm - and it may be even more difficult to sell them when you want to.


IF IT SOUNDS TOO GOOD TO BE TRUE, IT PROBABLY IS!


What can happen

In one recent case, a consumer received a "cold" call from a company he had not previously had anything to do with and was persuaded to buy shares in another company. Later on he received some paperwork in the post, including a 'stock purchase agreement'. This mentioned two other companies and claimed that one of these companies was FSA-authorised. When he checked with the FSA, he discovered that the company was not authorised and that the FSA Register number was false. He told the FSA what had happened and FSA enquiries revealed that the investment was entirely bogus and that the address was false. This particular individual was saved from losing a very substantial sum of money.

Always check whether the company is authorised in the UK. Look at the online FSA Firm Check Service to find out or ring the FSA Consumer Helpline 0845 606 1234 (calls charged at local rates). If it isn't, take care. You probably won't have the right to complain or seek a penny in compensation from the UK regulatory system if things go wrong.

Sam
Posted at 23/3/2004 19:45 by nod
My, what a nervous bunch :)
I don't believe the situation has worsened at all - on the contrary, things have not looked so bright for HST since 2001. Although the light at the end of the tunnel is still dim, at least there is some light now.

The Bennett deal changed the future for HST. What's the business worth to HST or someone else? I have no idea. But if someone were to pay £15m then that would cover the pref conversion and interest plus a small premium on the ords. If someone were to pay £20m then ords will more than double.
In other words, it's ordinary holders who will reap the reward of any offer above £15m.

Prefs may not be any better off if HST goes under. After accountants and bankers takes their cut, there will probably be little left for pref holders.
Prefs may not be better off if HST is sold, unless it's sold for less than its curent market cap of £3.2m plus pref repayments.

If an announcement is made on a deal, positive or negative, there will be no time to get in or out. The only way you can win is to be in. You could also lose a significant percentage.

I've taken a balanced view and have half in ords and half in prefs.
These are both high risk and not for widows, orphans or the nervous.
Posted at 21/3/2004 10:24 by andonis
I think the share price will fall if the deal is off but not
drastically.
The Prefs however? The HSTA? DO you think the price will hold?
Posted at 21/3/2004 00:27 by nod
Negotiations have been terminated in the past at prices higher than today's level.
That these talks take place at all implies bidders have done basic sums.
Bid offers are seldom below current price and are usually at a premium.
Current price usually factors in debt and risk.
The Bennett deal was a good one for both parties.
The Bennett deal enabled HST to renegotiate its bank debt.

From this information I would conclude:
a. HST are not yet cornered (though it may happen one day)
b. Neither pref holders nor the bank want HST to go under
c. An agreed bid would need to be Prefs + Ords + Debt
d. A premium on Ords seems biggest hurdle.

These major shareholders hold 57% and are not going to vote to lose their investment:
Major Shareholders Amount % Holding
J & O Hambro Inv Mgmt Ltd 26,060,000 16.44
North Atlantic Smaller Companies Investment Trust PLC 22,060,000 13.92
Henk Maris Van Heyst 13,500,000 8.52
Schroder Investment Management Limited 10,700,000 6.75
Veer Palthe Voute NV 6,641,947 4.19
Shaun Coleman Dowling • 6,500,534 4.10
Barclayshare Nominees Ltd 4,898,060 3.09
Posted at 20/3/2004 15:52 by besbury
Having been away from the PC for a few days I missed all the exitement!

I am a long term holder having first bought in June 1995 @ 14p. I averaged down several times but eventually lost patience and sold all HST @ 4.55p in June 02. However, being a shareholder in 1996 I took up my entitlemnt to the 8% cumulative convertible preference shares at 100p. I have since added more at a lower price to my original allocation and, more in hope than expectation, was looking forward to their redemption at 100p in July next year. Also of course we are owed several dividends. Without checking my records I believe it is four to date?

There have been several false dawns with "talks which may or may not result in a bid for the company". They have all fallen by the wayside, but could this one be different? I have no idea.

I have no intention of buying back HST as they are far too risky. I have taken a look a the trading in HSTA yesterday and IMO, that is where the smart money is going. Buying HSTA now is not without risk but it is, IMO, the much safer bet of the two.



I trust the foregoing will have been of some help.


Regards
B
Posted at 18/2/2004 15:38 by tanners
GG......have a read of my original post- the point I was making and that was being debated was the relative strnghth of the balance sheet.

The balance sheet remains the same......er, just the point I've repeatedly made.

Correct, you have more ord cap shares in issue, but no pref shares in issue, so the ord cap shares assume the pref. shares equity on the balance sheet.

In an ideal world the share price would change so that the market to book ratio remains the same........however I am not saying that that is what will happen.

In essence the ord cap equity is currently about £300,000......if £10 mill wa raised by the way of a placing of 1 bill shares at say 1p then the ord cap equity would then be £10,300,000.

If the share price does not react accordingly then the market to book ratio changes and you're looking at a completely different investing proposition.

Imagine the scenario if the market cap stayed the same after the placing (what you're suggesting)- you'd suddenly be able to buy the whole of the equity of the Company for 1/10 of the price.(or in effect ten times the equity for the same price).

Whats realsitic is probably somewhere between the two scenarios.

GG.....perhaps you should read ny origainal post regarding the balnce sheet and stock valuations to see that I am not of the opinion that equity stated will be the value actually realised in the event of liquidation.
Posted at 18/2/2004 11:54 by dell314
tanners - you appear confused.

If 10 mill of new ord cap shares were issued to repay the pref shares the balance sheet would remain exactly the same as the 10 mill of equity attributed to pref shares would simply be switched into 10 mill of equity for ord.

£10 mill of new equity is NOT being created, just swapped from pref. to ords.

If the new ord shares were issued and the price didn't rise accordingly, then the fundamental ratios such as price to book would alter significantly.

The pref. shares are clearly the safer bet, but then will be less rewarding if the Company does trade it s way through this period.

You are correct that the balance sheet would remain the same, as shareholder equity would replace pref debt.
Assuming, price to book remained roughly the same, it is market cap that remains the same(market cap may even rise with a strengthened balance sheet).
There would however be significantly more shares sharing the same assets, so the share price would be much lower and existing holders considerably diluted.

Rgds
dell
Posted at 11/12/2003 09:58 by currypata kai
11 December 2003



11 December 2003
(for immediate release)


THE HARTSTONE GROUP PLC



Announcement of Unaudited Preliminary Results
for the six months ended 30 September 2003



* Operating profit before non-recurring and central costs, #0.1 million
(2002: loss of #1.8 million)


* Non- recurring costs of #2.1 million


* Loss before tax of #1.8 million (2002: loss of #2.2 million


* Footwear Licensing agreement with Bennett Footwear Group signed in
September


* Trading in shares transferred to AIM




Commenting on the announcement, Hartstone's Chairman, Shaun Dowling said:



"The new Footwear Licensing Agreement has reduced working capital and given us a licence
income, but we have forfeited the contribution which the footwear division previously made
to company overheads. Further overhead savings are being made."





PRESS ENQUIRIES

The Hartstone Group PLC Tel: 01494 787700
Shaun Dowling, Chairman






THE HARTSTONE GROUP PLC

Unaudited results

for the six months ended 30 September 2003





GROUP RESULTS

In the half year to 30 September 2003, The Hartstone Group PLC made an operating
profit of #0.1 million, (2002: loss of #1.8 million) before non-recurring costs
of #2.1million and central costs of #0.2 million. After net interest payable of
#0.3 million and other finance income of #0.6 million, there was a loss before
tax of #1.8 million (2002: loss of #2.2 million).



The non-recurring costs principally relate to the cost incurred in entering into
a new licensing agreement with Bennett Footwear Group LLC and also to the
closure of full price stores. The other income of #585,000 arose from winding
up a dormant subsidiary pension fund and the taxation charge of #267,000 mainly
relates to this income. There was a cash inflow of #3.7 million as stocks were
reduced in the USA. Debtors increased by #2.7 million, principally due to the
sale of stocks to Bennett Footwear by means of stage payments.



ETIENNE AIGNER

Etienne Aigner, the principal trading company contributing to group results, had
another dismal trading period, as the whole US retail clothing sector remained
depressed, particularly in the early months, and our major customers, the
department stores, continued to lose business to low price chain stores. Sales
in our wholesale footwear division were 22% down on the previous year and sales
in our retail stores in the outlet malls were down by 13%. However, our smaller
accessory business held up well with a 46% increase in sales, but this was not
enough to prevent total sales in US dollars decreasing by 12%. During the
period, four of our five full price stores were closed and the last store was
closed in October, incurring costs of $0.8 million in the current period.



In July I reported that we had been negotiating for several months with a
purchaser and his partners to divest the Aigner business and these negotiations
were aborted. This was followed immediately by negotiations to license our
wholesale footwear business to Bennett Footwear Group LLC which was successfully
accomplished on 23 September 2003.



DIVIDENDS

The group will not be in a position to pay the preference dividend on 2 January
2004 due to the restriction by the US banks on remittances to the UK.



AIM

The company transferred trading in its ordinary and preference shares from the
Official List of the UK Listing Authority to the Alternative Investment Market
of the London Stock Exchange ("AIM") on 10 September 2003. This is a more
appropriate and, in certain circumstances, a cheaper market in which to operate
for a company of our size.



DIRECTORS

Mr Christopher H B Mills was appointed as a non-executive group director of The
Hartstone Group PLC on 14 October 2003. He is Chief Investment Officer and
indirect shareholder of J O Hambro Capital Management Ltd which has a
non-beneficial interest in 15.6% of the company's ordinary shares and 42% of its
preference shares in issue.



FUTURE PROSPECTS

The new licensing agreement will obviously have an impact on the Aigner
business, and also therefore on The Hartstone Group. The principal change will
be a reduction in working capital and bank borrowing, which has enabled Aigner
to enter into a new bank agreement. Although Aigner has gained the benefit of a
monthly license fee from Bennett Footwear, it has forfeited the contribution
which the footwear division previously made to company overheads. As a result,
the management structure has been streamlined, staff have been reduced and
overhead savings have been made.





SHAUN DOWLING

Chairman

11December 2003







The Hartstone Group PLC

Unaudited group profit and loss account

for the six months ended 30 September 2003






6 months 6 months Year
30/09/03 30/09/02 31/03/03
#000 #000 #000

Turnover 33,124 40,075 75,080

Cost of sales (20,625) (27,147) (51,718)

Gross profit 12,499 12,928 23,362
Net operating expenses (14,614) (14,915) (29,939)

Operating profit / (loss) before non-recurring and central costs 129 (1,834) (5,491)
Non-recurring costs (Note 3) (2,088) - (725)
Central Costs (156) (153) (361)

Operating (loss) (2,115) (1,987) (6,577)

Net interest (payable)/receivable (Note 4) (318) (215) (464)
Other finance income 585 - -

(Loss) on ordinary activities before taxation (1,848) (2,202) (7,041)

Taxation (267) (50) 75

(Loss) after taxation (2,115) (2,252) (6,966)

Dividend on non-equity shares (Note 5) (400) (400) (800)

(Loss) for the period transferred from reserves (2,515) (2,652) (7,766)


(Loss) per ordinary share (Note 6)

Basic and diluted (loss) per ordinary share (1.6)p (1.7)p (4.9)p

Adjusted (loss) per ordinary share (0.3)p (1.7)p (4.4)p






The Hartstone Group PLC

Unaudited consolidated balance sheet

at 30 September 2003






Restated

See note 2

30/09/03 30/09/02 31/03/03
#000 #000 #000

Fixed assets
Intangible assets - 35 -
Tangible fixed assets 3,135 4,225 3,948
3,135 4,260 3,948

Current assets
Stocks 10,742 21,394 18,019
Debtors 11,240 11,238 9,000
Cash at bank and in hand 536 935 1,151
22,518 33,567 28,170

Current liabilities
Creditors: Amounts falling due within 1 year (6,354) (4,023) (16,428)

Net current assets 16,164 29,544 11,742

Total assets less current liabilities 19,299 33,804 15,690

Creditors: Amounts falling due after more than 1 year (7,659) (13,576) (876)
Provisions for liabilities and charges (32) (160) (31)

Net assets excluding pension liabilities 11,608 20,068 14,783
Pension liabilities (1,288) (1,719) (1,804)

Net assets including pension liabilities 10,320 18,349 12,979

Capital and reserves:
Share capital 2,584 2,584 2,584
Capital redemption reserve 329 329 329
Profit and loss account 7,407 15,436 10,066

Shareholders' funds 10,320 18,349 12,979

Shareholders' funds represent:
Equity interests 322 8,351 2,981
Non equity interests 9,998 9,998 9,998

10,320 18,349 12,979

The Hartstone Group PLC

Unaudited consolidated statement of cash flows

for the six months ended 30 September 2003


6 months 6 months Year
30/09/03 30/09/02 31/03/03
#000 #000 #000

Net cash flow from continuing operating activities:
Operating (loss) (2,115) (1,987) (6,577)
Depreciation charges 451 626 1,032
Amortisation and permanent diminution in value 22 14 59
Impairment of fixed assets - - 607
Other non-cash items (7) - 122
Working capital movement - decrease in stocks 6,624 1,499 4,766
- (increase) / decrease in (2,741) 1,302 3,219
debtors
- increase in creditors 1,170 371 775

Net cash inflow from operating activities 3,404 1,825 4,003

Returns on investments and servicing of finance 349 (574) (808)

Taxation (189) (148) 62

Capital expenditure and financial investment 164 (611) (1,208)

Cash inflow before financing 3,728 492 2,049
Financing - (decrease) in debt (4,318) (1,591) (2,813)

(Decrease) in cash in the period (590) (1,099) (764)


Reconciliation of net cash flow to movement in net debt:
6 months 6 months Year

30/09/03 30/09/02 31/03/03
#000
#000 #000

(Decrease) in cash in the period (590) (1,099) (764)
Cash outflow from decrease in debt 4,318 1,591 2,813

Change in net debt resulting from cash flows 3,728 492 2,049
Other non cash items - issue costs to be amortised (6) (6) (14)
Translation difference 424 1,333 1,301

Movement in net debt in the period 4,146 1,819 3,336
Opening net debt (10,418) (13,754) (13,754)

Closing net debt (6,272) (11,935) (10,418)


The Hartstone Group PLC

Unaudited interim results

for the six months ended 30 September 2003






Unaudited statement of total recognised gains and losses Restated

See note 2
6 months 6 months Year
30/09/03 30/09/02 31/03/03
#000 #000 #000

(Loss) on ordinary activities after taxation (2,115) (2,252) (6,966)
Exchange (losses) / gains (578) (2,021) (2,086)
Release of deferred tax on exchange gains / (losses) - 400 362
Gain / (loss) on pension assets 434 (926) (1,079)

Total recognised (losses)/ gains for the period (2,259) (4,799) (9,769)
Prior period adjustment - adoption of FRS 17 (523)
Total recognised (losses)/ gains since the last interim (5,322)
report


Unaudited reconciliation of movements in shareholders' funds Restated

See note 2
6 months 6 months Year
30/09/03 30/09/02 31/03/03
#000 #000 #000

Total recognised (losses) for the period (2,259) (4,799) (9,769)
Dividend on non-equity shares (400) (400) (800)
Net (decrease) in shareholders' funds (2,659) (5,199) (10,569)

Opening shareholders' funds (originally #24.1 million before
deducting prior period adjustment of #0.5 million)
12,979 23,548 23,548

Closing shareholders' funds 10,320 18,349 12,979







The Hartstone Group PLC

Notes



Note 1: Interim Report

This interim report was neither audited nor reviewed by the auditors. The
figures for the year to 31 March 2003 were derived from the statutory accounts
for that year. The statutory accounts for the year ended 31 March 2003 have
been delivered to the Registrar of Companies and received an audit report which
was unqualified and did not contain statements under s237 (2) or (3) of the
Companies Act 1985.



The interim report was approved by the Board on 9 December 2003.



The interim report has been prepared using accounting policies that are
consistent with those adopted in the statutory accounts for the year ended 31
March 2003, except for Retirement Benefits. The last actuarial liability
valuations were carried out as at 31 March 2003 and have not been updated as at
30 September 2003. Therefore, the net pension liabilities shown in the balance
sheet have only been adjusted for the movement in value of the UK and US plan
assets and payments made into each plan.



Going concern

In the statutory accounts for the year ended 31 March 2003 we brought to your
attention that the group's principal US operating subsidiary was in breach of
its banking covenants which were to be renegotiated and that the board was
assessing alternative options to maximise the return to shareholders in the
group including the sale and/or licensing of all or part of the US business.



On 23 September 2003 the US business agreed with its lenders new banking
covenants and a new two year $20 million loan, reducing to $10 million by 31
March 2004. On 23 September 2003 the US business entered into a seven year
licensing agreement with the Bennett Footwear Group LLC to license its branded
footwear business in return for a royalty fee and also entered into additional
supplementary agreements, for varying periods, for both parties to provide
additional related services to each other.



The directors consider that in preparing these interim accounts they have taken
into account all information that could be reasonably expected to be available
including forecasts incorporating the effects of the new trading arrangement and
they consider that it is appropriate to prepare these accounts on a going
concern basis, consistent with the basis of preparation in the statutory
accounts for the year ended 31 March 2003.



Note 2: Restatement of comparatives

The early adoption of FRS 17, Retirement Benefits, in the year ended 31 March
2003 required a change to the accounting treatment of pensions. As a result the
prior period results have been restated accordingly as follows:



Consolidated balance sheet


Creditors due
1 year Liabilities account

#000

#000 #000

As previously reported at 30 September 2002 (4,293) - 16,885
Adoption of FRS 17 at 30 September 2002 270 (1,719) (1,449)

30 September 2002 restated (4,023) (1,719) 15,436






The Hartstone Group PLC

Notes (continued)





The movement of #1.4 million in the profit and loss account in the period ended
to 30 September 2002, shown above, represented the movement in the pension plan
asset values at that date which have been reflected in the Statement of Total
Recognised Gains and Losses.



Under FRS 17, the difference between the market value of the assets of the
group's UK and US defined benefit pension funds and the present value of the
accrued pension liabilities is shown as a liability on the balance sheet.
Previously, the only balance sheet item recognised was a provision representing
the deficit between the market value of the assets and the present value of the
liabilities of the US pension scheme which was frozen in 1992. The movement on
this deficit has been charged to the profit and loss account in prior years.





Note 3: Non-recurring costs

Non-recurring costs principally comprise the costs associated with entering into
the agreement to license its branded wholesale footwear business amounting to
#1.5 million, transaction costs associated with the aborted sale of the US
business amounting to #0.1 million and costs associated with the closure of the
Full Price division amounting to #0.5 million.



In the year to 31 March 2003 non-recurring costs principally comprised the
impairment of the Full Price division fixed assets and certain other
professional fees.




Note 4: Net interest (payable) / receivable 6 months 30/ 6 months Year
09/03
30/09/02 31/03/03
#000
#000 #000
Net interest charge

- payable on loans and overdrafts (268) (278) (556)

- interest receivable 12 104 142

(256) (174) (414)

Foreign exchange losses (56) (35) (36)

Refinancing costs (6) (6) (14)

(318) (215) (464)











Note 5: Dividend 6 months 30 6 months Year
/09/03
30/09/02 31/03/03
#000
#000 #000


Non Equity Shares - preference dividend 4p per preference 400 400 800
share, 2 July 2003



With cash transfers to the UK restricted by the US banks, the Group will not be in a position to pay the
preference dividend on 2 January 2004, and the dividends will continue to be rolled up for future payment.












The Hartstone Group PLC

Notes (continued)






Note 6: (Loss) per ordinary share

Basic and diluted loss per ordinary share is calculated using a loss of #2.5 million (2002: loss of #2.7
million), after deducting preference dividends, and a weighted average number of ordinary shares in issue of
158,485,711 (2002: 158,484,612).



The cumulative, convertible preference shares are anti-dilutive.



The adjusted loss per ordinary share is calculated using the basic loss of #2.5 million (#2002: loss of #2.7
million), stated above, and adding back non-recurring costs of #2.1 million (2002: #nil) and using the
weighted average number of ordinary shares stated above. This measure shows the loss per share of the
underlying business excluding one-off charges for transaction fees, the costs of entering into the footwear
licensing agreement and the closure of the Full Price division.





Note 7: Analysis of cash and indebtedness 6 months 30 6 months Year
/09/03
30/09/02 31/03/03
#000
#000 #000


Secured US bank loans (6,808) (12,870) (11,569)

Cash and bank balances 536 935 1,151

(6,272) (11,935) (10,418)







Note 8: Taxation

The charge principally arises on the income received from the settlement of the David Dixon Pension Fund,
which is included in other finance income, and US State taxes.








This information is provided by RNS
The company news service from the London Stock Exchange
END
Posted at 04/10/2003 11:52 by nod
Debt is about 18m but with the downturn in the US they have been defaulting on bank interest payments. They also defaulted on 8p per annum dividend payments to preference shareholders (2x4p). The bank could have pulled the plug and recovered some of the debt by selling assets - so the risk has been exceptionally high and the share price low.
Share price still reflects a high risk of going into liquidation. If the negotiation is completed and trading conditions improve then the share price should recover. I'm fairly positive on bank terms as the bank could have pulled out long ago.
With this Bennett deal they should be in a position to negotiate with the bank, resume dividend to pref shareholders (HSTA) and live happily ever after.

I hold both HST and HSTA - betting on a resumption of pref divis plus convertables are redeemable for 1 pound on 31-July-2005 - 22 months away - currently priced at around 44p to buy.
Of course, if they go bust I can wave goodbye to my wager.
Hartstone share price data is direct from the London Stock Exchange

Your Recent History

Delayed Upgrade Clock