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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Healthcare Ent. | LSE:HCEG | London | Ordinary Share | GB00B6030H73 | ORD 25P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 20.50 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
Hot Features
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TIDMHCEG
RNS Number : 0538T
Healthcare Enterprise Group PLC
29 May 2009
THIS ANNOUNCEMENT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO THE
UNITED STATES, CANADA, JAPAN, AUSTRALIA OR SOUTH AFRICA
29 May 2009
Healthcare Enterprise Group plc
Final results
Healthcare Enterprise Group plc (AIM: HCEG, "HCEG", the "Group", the "Company"),
the international healthcare products group, today reports results for the 16
months ended 30 June 2008.
Highlights (16 months period 2008, 12 month period 2007)
* Turnover from continuing operations GBP0.8m (2007: GBP0.6m)
* Normal net operating expenses GBP2.4m (2007: GBP2.0m)
* Operating loss before exceptional items GBP2.1m (2007: Loss GBP1.6m)
* Net loss for the period was GBP20.0m (2007: Loss GBP5.6m)
* Loss per share 6.4p (2007: Loss 2.6p)
Lyndon Gaborit, Executive Deputy Chairman, said:
"The sixteen month period was one of significant change for Healthcare
Enterprise Group plc ("HCEG"), as it continued to divest of non-core and
underperforming assets, whilst focussing on remaining core activities where
future growth opportunities are evident."
"Limited capital availability during the Group restructuring and divestment of
assets has presented a number of challenges to management and has acted as a
major constraint on growth and development. During the period under review, the
company's then bankers recalled their loans to the company which caused undue
financial pressure and affected the timing and value of assets to be spun off or
realised. This necessitated a refinancing and re-evaluation of the asset
realisation programme.
Since the period end the Group has been funded by loans from supportive
shareholders and selective sale of investments, most significantly those in
First Aid Holdings Limited ("FAH"), the company which purchased our Crest
Medical business in April 2008. The Group is currently engaged in a process of
refinancing whereby it is proposed that certain significant liabilities,
including convertible unsecured loan stock, held by HCEG will be converted into
a combination of equity in HCEG, FAH and subsidiaries Ebiox Limited ("Ebiox")
and Reproductive Sciences Limited ("RSL")."
"In the future the Group expects to function as an investment holding company
with a minimal overhead base which will be funded through a small-fund raising
or further realisation of the Group's investments. Notwithstanding the current
economic climate, we remain convinced that Healthcare Enterprise Group has
valuable investments in exciting niches of the healthcare market."
Enquiries:
Healthcare Enterprise Group PLC 01925 898 201
Lyndon Gaborit, Executive Deputy Chairman
Daniel Stewart 020 7776 6550
Graham Webster/Stewart Dick
Chairman's statement
I present the results for the 16 months ended 30 June 2008.
The sixteen month period was one of significant change for Healthcare Enterprise
Group plc ("HCEG"), as it continued to divest of non-core and underperforming
assets, whilst focussing on remaining core activities where future growth
opportunities are evident.
At the end of the period under review, the group's interests principally
comprised:
* 100% of Ebiox Limited ("Ebiox") - Cleaning and decontamination product range
* 100% of Reproductive Sciences Limited ("RSL") - Women's health medical
devices
* 34% of First Aid Holdings Limited ("FAH") - Importer and distributor of
medical products
During the period under review, the Group finalised the divestment of its Crest
Medical first aid supplies business to FAH for equity in that company. With the
agreement of FAH management, the Group then divested some of its holding in FAH
for cash in order to assist in the funding of its own restructure. The sale of
Crest Medical was a key element in the Board's strategy to restructure the Group
and to stem operating losses. While it was disappointing for the Board to accept
the losses incurred on the sale of that business, it was essential to secure the
future of the remainder of the Group. The loss for the period after discontinued
operations was GBP20.0m (2007: GBP5.6m).
The sale of the Crest Medical business allowed the Board to focus on the two
remaining businesses which they believed offered reasonable upside for
shareholders. Operations were slimmed down during the period under review, with
some additional costs being incurred in the process. Availability of cash
resources remained limited and continuing operations were constrained as a
consequence. Revenues from the Ebiox decontamination business suffered due to
shortage of working capital and final development of the Fertiligent product was
also affected. During the period under review, the company's then bankers
required their loans to be repaid which placed undue financial pressure on the
Group, complicated the restructure process which was already underway, and no
doubt affected the sale prices of the businesses being divested.
At the end of 2007, and during the course of the negotiations for the sale of
Crest Medical, the Group completed a major refinancing exercise resulting in the
redemption of bank indebtedness and providing additional working capital to the
Group as it completed its divestment programme. As part of this refinancing,
GBP1.75 million of 8% 2012 Convertible Unsecured Loan Stock (CULS) and GBP0.5
million of 8% 2008 Secured Loan Stock were issued.
Ebiox Limited
Ebiox has a range of patented cleaning and decontamination products for sale
primarily into the healthcare and dental sectors. Ebiox products remove
pathogenic organisms, soiling and biofilms from hands, surgical instruments,
medical devices and any washable surface. The competitive advantages of Ebiox
are that it cleans to the molecular level, removing bio films, is effective
against a wide range of pathogens, is non-alcohol based and safe in use.
The revenues of Ebiox during the period were GBP0.8m (2007:GBP0.6m) and
operating losses before allocation of group overheads were GBP0.5m
(2007:GBP0.1m).
After the period end, Ebiox secured the services of John Honey as Executive
Chairman. John, who was formerly a Senior Vice President of Reckitt Benckiser
plc, will initially be overseeing the development and further commercialisation
of the Ebiox range of products.
Since the period end, the Group has repaid some of its Secured Loan Stock
amounting to GBP0.2m, in the form of shares in Ebiox such that the Group's
holding in Ebiox has been reduced to 95%.
Reproductive Sciences Limited (RSL)
RSL has invested in women's health devices through its holding in Fertiligent
Limited. Fertiligent has developed a high quality, low cost intra-uterine sperm
pump to assist infertile couples conceive. Results from trials conducted in
Germany and Israel to date show a 234% improvement in success rate against the
most commonly used method, intra-uterine insemination. Larger trials are
commencing at Carmel Medical Centre, Israel and a US FDA medical device
application is currently in progress with manufacturing production due to
commence shortly. Commercial sales are expected to commence late 2009.
During the period under review, RSL recorded losses of GBP32,000
(2007:GBP20,000) and invested a further GBP112,000 into the Fertiligent business
(2007:GBP34,000).
At the period end RSL had a direct 20% shareholding in Fertiligent Limited (an
Israeli company) and options to increase that stake to approximately 65%. RSL
also owns the worldwide, exclusive sales and marketing rights to Fertiligent's
products.
First Aid Holdings Limited
On 4 April 2008, the Group completed the disposal of Crest Medical Limited to a
new company, First Aid Holdings Limited (FAH), in return for a 44% equity
interest in FAH. FAH also acquired the business of First Aid Warehouse and its
associated companies. The Group has, since the period end, reduced its
shareholding in FAH by the sale of some shares for cash, amounting to GBP0.3m,
and transferring part of its equity to the holders of Secured Loan Stock in the
Group, amounting to GBP0.4m with accrued interest, such that it now holds 9% of
that company.
The operating losses directly attributed to the Crest Medical business during
the period were GBP1.8m (2007:GBP0.7m), and the exceptional losses were a
further GBP4.8m (2007:GBP0.8m).
FAH continues to operate in the import and distribution of medical products
sector, including the supply of first aid kits, and has expanded its offering to
include medical equipment and the supply to general practitioners and primary
care trusts.
Outlook
Limited capital availability during the Group restructuring and divestment of
assets has presented a number of challenges to management and has acted as a
major constraint on growth and development. Since the period end the Group has
been funded by loans from supportive shareholders and selective sale of
investments, most significantly those in FAH. The Group is currently engaged in
a process of refinancing whereby it is proposed that certain significant
liabilities, including convertible unsecured loan stock, held by HCEG will be
converted into a combination of equity in HCEG, Ebiox Limited, RSL and FAH.
In the future the Group expects to function as an investment holding company
with a minimal overhead base which will be funded through a small-fund raising
or further realisation of the Group's investments. Notwithstanding the current
economic climate, we remain convinced that Healthcare Enterprise Group has
valuable investments in exciting niches of the healthcare market.
L J Gaborit
Executive Deputy Chairman
29 May 2009
Healthcare Enterprise Group Plc
Consolidated Income Statement
For the 16 months ended 30 June 2008
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | Notes | Period | Year |
| | | ended | ended |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | 30 | 28 Feb |
| | | June | |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | 2008 | 2007 |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | GBP'000 | GBP'000 |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | | |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| Revenue - continuing activities | 3 | 793 | 557 |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | | |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| Cost of sales | | (413) | (220) |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | ________ | ________ |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | | |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| Gross profit | | 380 | 337 |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | | |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| Net operating expenses - normal | | (2,444) | (1,952) |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| Net operating expenses - exceptional | 4 | (10,966) | (2,350) |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | ________ | ________ |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | | |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| Total net operating expenses | | (13,410) | (4,302) |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | ________ | ________ |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | | |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| Operating loss | | (13,030) | (3,965) |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | ________ | ________ |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | | |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| Finance expense | | (233) | (101) |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | ________ | ________ |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | | |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| Loss before taxation | | (13,263) | (4,066) |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | ________ | ________ |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | | |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| Income tax expense | | - | (5) |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | ________ | ________ |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | | |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| Loss from continuing operations | | (13,263) | (4,071) |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | ________ | ________ |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | | |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| Discontinued operations - normal | | (1,886) | (722) |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| Discontinued operations -exceptional | 4 | (4,804) | (808) |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | ________ | ________ |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | | |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| Loss from discontinued operations | 5 | (6,690) | (1,530) |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | ________ | ________ |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | | |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| Loss for the period | | (19,953) | (5,601) |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | ________ | ________ |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| Attributable to: | | | |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| Equity holders of the parent | | (19,886) | (5,608) |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| Minority interest | | (67) | 7 |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | ________ | ________ |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | | |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | (19,953) | (5,601) |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | ________ | ________ |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| Earnings per share | | | |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| From continuing operations: | | | |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| Basic (loss) per share | 6 | (4.2)p | (1.9)p |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| Diluted (loss) per share | 6 | (4.2)p | (1.9)p |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | | |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| From continuing and discontinued operations: | | | |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| Basic (loss) per share | 6 | (6.4)p | (2.6)p |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| Diluted (loss) per share | 6 | (6.4)p | (2.6)p |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
| | | | |
+-----------------------------------------------+-----------+----------------------------------------------------------------+---------------+
Healthcare Enterprise Group Plc
Consolidated Balance Sheet
As at 30 June 2008
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | As | As |
| | | at | at |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | Notes | 30 June | 28 Feb |
| | | 2008 | 2007 |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | GBP'000 | GBP'000 |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Non-current assets | | | |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Property, plant & equipment | | 41 | 428 |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Goodwill | | 3,300 | 19,489 |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Other intangible assets | | 534 | 843 |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Available for sale investments | | 2,164 | 682 |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | ________ | ________ |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | | |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | 6,039 | 21,442 |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | ________ | ________ |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Current assets | | | |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Inventories | | 36 | 1,834 |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Trade receivables | | 111 | 1,570 |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Other current assets | | 246 | 1,741 |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Cash and cash equivalents | | 47 | 690 |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | ________ | ________ |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | | |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | 440 | 5,835 |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | ________ | ________ |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | | |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Total assets | | 6,479 | 27,277 |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | ________ | ________ |
| | | | |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Current liabilities | | | |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Financial liabilities | 7 | (549) | (2,116) |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Trade and other payables | | (1,706) | (3,209) |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Current tax payable | | - | (36) |
| | | | |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | ________ | ________ |
| | | | |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | | |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | (2,255) | (5,361) |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | ________ | ________ |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Non-current liabilities | | | |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Financial liabilities | 7 | (1,900) | - |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Other payables | | (14) | (33) |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | ________ | ________ |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | | |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | (1,914) | (33) |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | ________ | ________ |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | | |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Total liabilities | | (4,169) | (5,394) |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | ________ | ________ |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | | |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Net assets | | 2,310 | 21,883 |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | ________ | ________ |
| | | | |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Equity attributable to the | | | |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| equity holders of the parent | | | |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Ordinary shares | 8 | 339 | 7,555 |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Shares to be issued | 8 | - | 271 |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Share premium | | 42,088 | 42,065 |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Deferred shares | 8 | 8,371 | 746 |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Retained earnings | | (47,736) | (27,850) |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Translation reserve | | (68) | (58) |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Other reserves | | (684) | (903) |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | ________ | ________ |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | | |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | 2,310 | 21,826 |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | ________ | ________ |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | | |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Minority interest | | - | 57 |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | ________ | ________ |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | | |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| Total equity | | 2,310 | 21,883 |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | ________ | ________ |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
| | | | |
+----------------------------------------------+---------+-------------------------------------------------------------------------+----------------------------------------------------------------------+
Healthcare Enterprise Group Plc
Consolidated Cash Flow Statement
For the 16 months ended 30 June 2008
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | | |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | Year | Year ended |
| | ended | |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | 30 June 2008 | 28 Feb 2007 |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | GBP'000 | GBP'000 |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Cash flows from operating activities | | |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Operating loss | | |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| - continuing operations | (13,030) | (3,965) |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| - discontinued operations | (6,628) | (1,519) |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| - exceptional operating costs charged | 15,770 | 3,158 |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | ________ | ________ |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | | |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Total group loss before exceptional items | (3,888) | (2,326) |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | ________ | ________ |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Cash payments in respect of exceptional | | |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Costs and provisions | (789) | (533) |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Depreciation and amortisation | 209 | 238 |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Decrease/(increase) in working capital | 2,576 | (1,512) |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Other | 32 | 32 |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | ________ | ________ |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | | |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Net cash from operations | (1,860) | (4,101) |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | ________ | ________ |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | | |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Interest received | - | - |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Interest paid | (295) | (113) |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Tax paid | - | (19) |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | ________ | ________ |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | | |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Net cash from operating activities | (2,155) | (4,233) |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | ________ | ________ |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Cash flows from investing activities | | |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Purchase of plant and equipment | (69) | (87) |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Development costs capitalised | - | (149) |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Other intangibles capitalised | | (100) |
| | - | |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Proceeds from sale of business | 437 | - |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Purchase of other investments | (111) | - |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Proceeds from sale of other investments | 180 | - |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Purchase of subsidiary undertakings | - | (93) |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | ________ | ________ |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | | |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Net cash from investing activities | 437 | (429) |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | ________ | ________ |
| | | |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Cash flows from financing activities | | |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Net proceeds from issue of ordinary share capital | - | 6,244 |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Debt due within one year | | |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| - repayment of sterling borrowings | (1,500) | (222) |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| - issue of sterling borrowings | 500 | - |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Debt due after more than one year | | |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| - net movements on long term facilities | 1,750 | (1,125) |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| - other | 300 | - |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Inception of finance leases | 26 | - |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Finance lease principal repayments | (1) | (34) |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | ________ | ________ |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | | |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Net cash from financing activities | 1,075 | 4,863 |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | ________ | ________ |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | | |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Net decrease in cash and cash equivalents | (643) | 201 |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | ________ | ________ |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | | |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Cash and cash equivalents at beginning of period | 690 | 489 |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | ________ | ________ |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | | |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| Cash and cash equivalents at end of period | 47 | 690 |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | ________ | ________ |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
| | | |
+--------------------------------------------------------+----------------------------------------------------+----------------------------------------------------------+
Healthcare Enterprise Group plc
Statements of changes in equity
for the period ended 30 June 2008
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| | | | | | | | | | | |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| | Issued | Shares to | Share | Deferred | Other | Translation | Retained | | Minority | Total |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| Group | capital | be issued | premium | shares | reserves | reserve | earnings | Total | interest | equity |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| | | | | | | | | | | |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| At 1 March 2006 | 4,298 | 620 | 39,078 | 746 | (1,208) | - | (22,249) | 21,285 | 64 | 21,349 |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| | | | | | | | | | | |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| Exchange losses offset in reserves | - | - | - | - | - | (58) | - | (58) | - | (58) |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| | | | | | | | | | | |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| Net income recognised directly in equity | - | - | - | - | - | (58) | - | (58) | - | (58) |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| | | | | | | | | | | |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| Loss for the year | - | - | - | - | - | - | (5,601) | (5,601) | (7) | (5,608) |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| | | | | | | | | | | |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| Total recognised expense for the year | - | - | - | - | - | (58) | (5,601) | (5,659) | (7) | (5,666) |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| | | | | | | | | | | |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| Issue of shares | 3,220 | (349) | 2,952 | - | - | - | - | 5,823 | - | 5,823 |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| Share based payments | 37 | - | 35 | - | 305 | - | - | 377 | - | 377 |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| | | | | | | | | | | |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| At 28 February 2007 | 7,555 | 271 | 42,065 | 746 | (903) | (58) | (27,850) | 21,826 | 57 | 21,883 |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| | | | | | | | | | | |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| | | | | | | | | | | |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| Equity element of convertible debt | - | - | - | - | 144 | - | - | 144 | - | 144 |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| Exchange losses offset in reserves | - | - | - | - | - | (10) | - | (10) | - | (10) |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| Disposal | - | - | - | - | - | - | - | - | 10 | 10 |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| | | | | | | | | | | |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| Net income recognised directly in equity | - | - | - | - | 144 | (10) | - | 134 | 10 | 144 |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| | | | | | | | | | | |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| Loss for the period | - | - | - | - | - | - | (19,886) | (19,886) | (67) | (19,953) |
| | | | | | | | | | | |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| | | | | | | | | | | |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| Total recognised expense for the year | - | - | - | - | 144 | (10) | (19,886) | (19,752) | (57) | (19,809) |
| | | | | | | | | | | |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| | | | | | | | | | | |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| Issue of shares | 409 | (271) | 23 | - | - | - | - | 161 | - | 161 |
| | | | | | | | | | | |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| Share based payments | - | - | - | - | 75 | - | - | 75 | - | 75 |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| Capital reorganisation | (7,625) | - | - | 7,625 | - | - | - | - | - | - |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| | | | | | | | | | | |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| | | | | | | | | | | |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| At 30 June 2008 | 339 | - | 42,088 | 8,371 | (684) | (68) | (47,736) | 2,310 | - | 2,310 |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
| | | | | | | | | | | |
| | | | | | | | | | | |
+------------------------------------------+---------+-----------+---------+----------+----------+-------------+--------------+----------+----------+----------+
Healthcare Enterprise Group plc
Notes to the financial statements
for the period ended 30 June 2008
1. Basis of preparation
The consolidated financial statements of Healthcare Enterprise Group plc for the
16 months ended 30 June 2008 were authorised for issue by the Directors on 29
May 2009.
The financial information contained in these financial statements is derived
from those financial statements.
The financial information in this document does not constitute the Group's
statutory accounts for the 16 month financial period ended 30 June 2008 or for
the year ended 28 February 2007, but is derived from those accounts. Statutory
accounts for 2007 have been delivered to the Registrar of Companies and those
for 2008 will shortly be delivered. The auditors report on the prior year
accounts was unqualified and did not contain statements under sections 237 (2)
or (3) of the Companies Act 1985 but did contain an emphasis of matter paragraph
regarding the going concern basis of preparation. The auditors have reported on
the current period accounts and their report did not contain statements under
sections 237 (2) or (3) of the Companies Act 1985. Their report was unqualified
but did include an emphasis of matter paragraph as follows:
"Emphasis of matter - going concern
In forming our opinion on the financial statements, which is not qualified, we
have considered the adequacy of the disclosures made in note 1 to the financial
statements concerning the group's and company's ability to continue as a going
concern. The group and company are dependent on continuing support of
shareholders and the disposal of selective investments and assets in order to
satisfy their liabilities and to provide funding to meet their ongoing costs.
The group and company are currently engaged in a re-financing of debt which will
require shareholder approval. The directors believe that shareholders will
approve the proposals and will continue to support the group and company but
this is not guaranteed. If the shareholders did not approve the proposals, the
directors would have to seek alternative funding which is only likely to be
through further disposals of investments, which if insufficient to satisfy its
liabilities would mean the group and company would be unable to continue as a
going concern. Along with the matters disclosed in note 1 to the financial
statements these conditions indicate the existence of a material uncertainty
which may cast significant doubt about the group's and company's ability to
continue as a going concern. The financial statements do not include the
adjustments that would result if the group and company were unable to continue
as a going concern."
2. Principal accounting policies
The accounting policies set out in the financial statements for the period
ending 30 June 2008 are as follows:
Basis of preparation
Healthcare Enterprise Group plc's financial statements were prepared under UK
Generally Accepted Accounting Principles ("UK GAAP") until 28 February 2007. In
preparing the financial statements for the period ended 30 June 2008 under IFRS,
for the first time, the directors have amended certain accounting methods to
comply with IFRSs and to correct identified errors. The comparative figures in
respect of the year ended 28 February 2007 have been restated to reflect these
adjustments and the disclosures required by IFRS 1 concerning the transition
from UK GAAP to IFRSs are given in note 10.
The financial statements have been prepared on the going concern basis which
assumes that the Group will be able to meet its liabilities as they fall due.
The Group's portfolio of products include some at early stage and not yet in the
marketplace and Ebiox which has lacked the investment required to be
self-sustaining. Given the Group's continuing losses further funding will be
required to meet the Group's continuing operating costs and liabilities.
Since the period end the Group has been funded by loans from supportive
shareholders and selective sale of investments, most significantly those in
First Aid Holdings Limited ("FAH"). The Group is currently in engaged in a
process of refinancing whereby it is proposed that certain significant
liabilities, including convertible unsecured loan stock, held by Healthcare
Enterprise Group plc ("HCEG") will be converted into a combination of equity in
HCEG, Ebiox Limited, Reproductive Sciences Limited and FAH. The proposed
refinancing will require shareholder approval and the directors believe that
shareholders will approve the proposals.
In the future the Group expects to function as an investment holding company
with a minimal overhead base which will be funded through a small fund-raising
exercise or the further realisation of the Group's investments. The directors
believe that the Group's plans are achievable given the continued support of
significant shareholders and the ability to achieve piecemeal investment sales
already evidenced in the period since the 30 June 2008. However these conditions
constitute a material uncertainty that may cast significant doubt about the
group's and company's ability to continue as a going concern. After making
enquiries, and considering the uncertainties surrounding the potential
refinancing and future operations described above, the directors have a
reasonable expectation that the Group and the Company have adequate resources,
or the expectation of access to adequate resources, to continue trading for the
foreseeable future. It is therefore appropriate to prepare the financial
statements on a going concern basis.
* IFRS 1: First-time adoption of International Financial Reporting Standards
The rules for first-time adoption of IFRSs are set out in IFRS 1, which requires
that the group establishes its IFRSs accounting policies at its date of
transition, 1 March 2006, and applies these prospectively. The standard allows a
number of optional exemptions on transition to help companies simplify the move
to IFRSs. The exemptions selected by the group are set out below:
Business Combinations (IFRS 3)
The group has elected to apply IFRS 3 prospectively from the date of transition
to IFRS rather than to restate previous business combinations.
Presentation of financial information
The layout of the primary financial information has been amended in accordance
with IAS 1 'Presentation of financial information' from that presented under UK
GAAP. This format and presentation may require modification as practice and
industry consensus develops.
* New standards and interpretations applied
The following standards and interpretations to existing standards have been
published but are not mandatory for the period ended 30 June 2008 and have not
been applied during the period:
+------------------------------------------------------------+---------------------------------------------+
| | Effective dates (periods |
| | |
+------------------------------------------------------------+---------------------------------------------+
| | beginning on or after) |
+------------------------------------------------------------+---------------------------------------------+
| IFRIC 14, IAS 19 - The Limit on a Defined Benefit Asset, | |
+------------------------------------------------------------+---------------------------------------------+
| Minimum Funding Requirements and their Interaction | 1 |
| | January |
| | 2008 |
+------------------------------------------------------------+---------------------------------------------+
| IFRIC 12 - Service Concession Arrangements | 1 |
| | January |
| | 2008 |
+------------------------------------------------------------+---------------------------------------------+
| IFRIC 13 - Customer Loyalty Programmes | 1 |
| | July |
| | 2008 |
+------------------------------------------------------------+---------------------------------------------+
| IAS 39, IFRS 7 - Reclassification of Financial Instruments | 1 |
| | July |
| | 2008 |
+------------------------------------------------------------+---------------------------------------------+
| IFRIC 16 Hedges of a Net Investment in a Foreign Operation | 1 |
| | October |
| | 2008 |
+------------------------------------------------------------+---------------------------------------------+
| IFRS 8 - Operating Segments | 1 |
| | January |
| | 2009 |
+------------------------------------------------------------+---------------------------------------------+
| IAS 23 - Borrowing costs - revised | 1 |
| | January |
| | 2009 |
+------------------------------------------------------------+---------------------------------------------+
| IFRIC 15 - Agreements for the Construction of Real Estate | 1 |
| | January |
| | 2009 |
+------------------------------------------------------------+---------------------------------------------+
| IFRS 2 - Share-based payments - amended | 1 |
| | January |
| | 2009 |
+------------------------------------------------------------+---------------------------------------------+
| IAS 23 - Borrowing costs - amended | 1 |
| | January |
| | 2009 |
+------------------------------------------------------------+---------------------------------------------+
| IAS 1 - Presentation of Financial Statements - revised | 1 |
| | January |
| | 2009 |
+------------------------------------------------------------+---------------------------------------------+
| IAS 32, IAS 1 - Puttable Financial Instruments and | |
+------------------------------------------------------------+---------------------------------------------+
| Obligations Arising on Liquidation | 1 |
| | January |
| | 2009 |
+------------------------------------------------------------+---------------------------------------------+
| Improvements to IFRSs | 1 |
| | January |
| | 2009 |
+------------------------------------------------------------+---------------------------------------------+
| IFRS 1, IAS 27 - Cost of an Investment in a Subsidiary, | |
+------------------------------------------------------------+---------------------------------------------+
| Jointly-controlled Entity or Associate | 1 |
| | January |
| | 2009 |
+------------------------------------------------------------+---------------------------------------------+
| IAS 39 - Financial Instruments: Eligible Hedged Items | 1 |
| | July |
| | 2009 |
+------------------------------------------------------------+---------------------------------------------+
| IFRS 3 - Business Combinations - revised | 1 |
| | July |
| | 2009 |
+------------------------------------------------------------+---------------------------------------------+
| IAS 27 - Consolidated and Separate Financial Statements | 1 |
| | July |
| | 2009 |
+------------------------------------------------------------+---------------------------------------------+
| | |
+------------------------------------------------------------+---------------------------------------------+
The directors do not anticipate that the adoption of these standards and
interpretations will have a material impact on the group's financial statements
in the period of initial application.
* Basis of consolidation
The consolidated financial statements incorporate the financial statements of
the company and entities controlled by the company. Control is achieved where
the company has the power to govern the financial and operating policies of an
investee entity so as to obtain benefits from its activities.
Where necessary, adjustments are made to the financial statements of
subsidiaries to bring the accounting policies used into line with those used by
the group. All intra-group transactions, balances, income and expenses are
eliminated on consolidation.
Associates are all entities over which the Group exercises significant
influence. Investments in associates are accounted for by the equity method of
accounting and are initially recognised at cost, in accordance with the
alternative treatment allowed by IAS 31 and IAS 28. The Group's share of any
associate profits or losses after tax are recognised in the income statement and
its share of post-acquisition movements in reserves is recognised in reserves.
The cumulative post-acquisition movements are adjusted against the carrying
amount of the investment.
When the Group's share of losses after tax in an associate equals or exceeds its
interest or participation, the Group does not recognise further losses, unless
it has incurred obligations or made payments on behalf of the associate.
Unrealised gains on transactions between the Group and any associates are
eliminated to the extent of its interest or participation. Unrealised losses are
also eliminated unless the transaction provides evidence of an impairment of the
asset transferred.
Acquisition method of accounting
The cost of the acquisition is measured at the aggregate of the fair values, at
the date of exchange, of assets given, liabilities incurred or assumed, and
equity instruments issued by the group in exchange for control of the acquiree,
plus any costs directly attributable to the business combination. The acquiree's
identifiable assets, liabilities and contingent liabilities that meet the
conditions for recognition under IFRS 3 are recognised at their fair value at
the acquisition date. The results of acquired operations are included in the
consolidated income statement from the date on which control is obtained.
Goodwill
Goodwill arising on consolidation represents the excess of the cost of
acquisition over the group's interest in the fair value of the identifiable
assets and liabilities, including contingent liabilities, of a subsidiary.
Goodwill is initially recognised as an asset at cost and is subsequently
measured at cost less any accumulated impairment losses. Goodwill which is
recognised as an asset is reviewed for impairment at least annually. Any
impairment is recognised immediately in the income statement and is not
subsequently reversed.
For the purpose of impairment testing, goodwill is allocated to each of the
group's cash-generating units expected to benefit from the synergies of the
combination. Cash-generating units to which goodwill has been allocated are
tested for impairment annually, or more frequently when there is an indication
that the unit may be impaired if the recoverable amount of the cash-generating
unit is less than the carrying amount of the unit, the impairment loss is
allocated first to reduce the carrying amount of any goodwill allocated to the
unit and then to the other assets of the unit pro rata on the basis of the
carrying amount of each asset in the unit. An Impairment loss recognised for
goodwill is not reversed in a subsequent period.
Goodwill arising on other acquisitions before the date of transition to IFRSs
has been retained at the previous UK GAAP amounts subject to being tested for
impairment at that date.
Revenue recognition
Revenue is measured at the fair value of the consideration received or
receivable and represents amounts receivable for product sales provided in the
normal course of business, net of discounts, VAT and other sales related taxes.
Revenue is recognised when the Group has transferred to the buyer the
significant risks and rewards of ownership of the goods, the Group retains
neither the continuing managerial involvement to the degree usually associated
with ownership nor effective control over the goods sold, the amount of revenue
can be measured reliably, it is probable that the economic benefits associated
with the transaction will flow to the Group and the costs incurred or to be
incurred in respect of the transaction can be measured reliably.
Operating loss
Operating loss is stated after exceptional items, but before finance income and
finance costs.
Exceptional items
Exceptional items are material items that are unusual in nature, where separate
disclosure is necessary and relevant to provide an understanding of the group's
financial performance.
Plant and equipment
Fixtures and equipment are stated at cost less accumulated depreciation and any
recognised impairment loss.
Depreciation is charged so as to write off the cost or valuation of assets over
their estimated useful lives. The rates generally applicable are:
Leasehold improvements - Over the length of the lease
Plant, machinery, fixtures & fittings - 15-25% per annum on cost
Motor vehicles - 25% per annum on cost
Development costs
Development costs are capitalised by the group where:
* it is technically feasible to develop the product for it to be sold
* adequate resources are available to complete the development
* there is an intention to complete and sell the product
* the group is able to sell the product
* sale of the product will generate future economic benefits
* expenditure on the project can be measured reliably
Development costs are recognised as an internally generated intangible asset
with a definite useful life and are amortised over that useful life, they are
also reviewed for impairment at least annually. Amortisation of development
costs is included in Depreciation and amortisation costs in the consolidated
income statement on page 4. Any impairment is recognised immediately in the
income statement and not subsequently reversed.
Deferred taxation
Deferred tax assets and liabilities are recognised where the carrying amount of
an asset or liability in the balance sheet differs from its tax base, except for
differences arising on:
* the initial recognition of goodwill,
* goodwill for which amortisation is not tax deductible,
* the initial recognition of an asset or liability in a transaction which is
not a business combination and at the time of the transaction affects neither
accounting nor taxable profit, and
* investments in subsidiaries and jointly controlled entities where the group
is able to control the timing of the reversal of the difference and it is
probable that the difference will not reverse in the foreseeable future
Recognition of deferred tax assets is restricted to those instances where it is
probable that taxable profit will be available against which the difference can
be utilised.
The amount of the asset or liability is determined using tax rates that have
been enacted or substantively enacted by the balance sheet date and are expected
to apply when the deferred tax liabilities/(assets) are settled/(recovered).
Deferred tax balances are not discounted.
Deferred tax assets and liabilities are offset when the group has a legally
enforceable right to offset current tax assets and liabilities and the deferred
tax assets and liabilities relate to taxes levied by the same tax authority on
either:
* the same taxable group company, or
* different group entitles which intend either to settle current tax assets and
liabilities on a net basis, or to realise the assets and settle the liabilities
simultaneously, in each future period in which significant amounts of deferred
tax assets or liabilities are expected to be settled or recovered.
Inventories
Inventories are valued at the lower of cost and net realisable value. Cost is
based on the cost of purchase on a first in, first out basis. Net realisable
value is based on estimated selling price.
Financial instruments
The only categories the directors consider the group to have financial
instruments in are as follows:
Available for sale financial assets
Available for sale financial assets are non-derivatives that are either
designated in this category or not classified in any of the other categories.
They are included within non-current assets unless the Group intends to dispose
of them within a year of the balance sheet date. When investments classified as
available for sale assets are sold or impaired, the accumulated fair value
adjustments recognised in equity are included in the income statement.
If the market for a financial asset is not active (and for unlisted securities),
the Group establishes fair value by using valuation techniques. If the fair
value of an unquoted entity cannot be measured reliably, it is measured at cost.
Loans and receivables
These assets are non-derivative financial assets with fixed or determinable
payments that are not quoted in an active market. They arise principally through
the provision of goods and services to customers (e.g. trade receivables), but
also incorporate other types of contractual monetary asset. They are initially
recognised at fair value plus transaction costs that are directly attributable
to their acquisition or issue, and are subsequently carried at amortised cost
using the effective interest rate method, less provision for impairment.
Impairment provisions are recognised when there is objective evidence (such as
significant financial difficulties on the part of the counterparty or default or
significant delay in payment) that the group will be unable to collect all of
the amounts due under the terms receivable, the amount of such a provision being
the difference between the net carrying amount and the present value of the
future expected cash flows associated with the impaired receivable. For trade
receivables, which are reported net, such provisions are recorded in a separate
allowance account with the loss being recognised within administrative expenses
in the income statement. On confirmation that the trade receivable will not be
collectable, the gross carrying value of the assets is written off against the
associated provision.
From time to time, the group elects to renegotiate the terms of trade
receivables due from customers with which it has previously had a good trading
history. Such renegotiations will lead to changes in the timing of payments
rather than changes to the amounts owed and, in consequence, the new expected
cash flows are discounted at the original effective interest rate.
The group's loans and receivables comprise trade and other receivables and cash
and cash equivalents in the balance sheet.
Cash and cash equivalents includes cash in hand and deposits held with banks.
Leases and hire purchase contracts
Where assets are financed by leasing agreements that give rights approximating
to ownership (finance leases), the assets are treated as if they had been
purchased outright. The amount capitalised is the present value of the minimum
lease payments payable over the term of the lease. The corresponding leasing
commitments are shown as amounts payable to the lessor. Depreciation on the
relevant assets is charged to the income statement.
Lease payments are analysed between capital and interest components so that the
interest element of the payment is charged to the income statement over the
period of the lease and represents a constant proportion of the balances of
capital repayments outstanding. The capital part reduces the amounts payable to
the lessor.
All other leases are treated as operating leases. Their annual rentals are
charged to the income statement on a straight-line basis over the term of the
lease, even if the payments are not made on such a basis.
Other financial liabilities
These include trade payables and other short-term monetary liabilities, which
are recognised at fair value and thereafter at amortised cost.
Convertible debt
The proceeds received on issue of the group's convertible debt are allocated
into their liability and equity components. The amount initially attributed to
the debt component equals the discounted cash flows using a market rate of
interest that would be payable on a similar debt instrument that did not include
an option to convert. Subsequently, the debt component is accounted for as a
financial liability measured at amortised cost.
The difference between the net proceeds of the convertible debt and the amount
allocated to the debt component is credited directly to equity and is not
subsequently remeasured if converted, the debt and equity elements are credited
to share capital and share premium, as appropriate.
Share-based employee remuneration
The fair value of options granted is recognised as an employee expense, with a
corresponding increase in equity reserves. The fair value is recognised at the
grant date and spread over the period the employees become unconditionally
entitled to the options. The fair value of the options granted is measured using
the binomial option pricing model, taking into account the terms and conditions
on which the options were granted. The amount recognised as an expense is
adjusted to reflect the actual number of share options that vest except where
variations are due only to share prices not achieving the threshold for vesting.
Pension costs
Certain subsidiaries of the Company operate defined contribution pension schemes
for their employees and directors. The assets of the schemes are held separately
from those of the Group. The annual contributions payable are charged to the
Group consolidated income statement. The Company provides no other
post-retirement benefits to its employees and directors.
Provisions
Provisions are recognised when the group has a present obligation as a result of
a past event, and it is probable that the group will be required to settle that
obligation.
Provisions are measured at the directors' best estimate of the expenditure
required to settle the obligation at the balance sheet date, and are discounted
to present value where the effect is material.
Non-current assets held for sale and disposal groups
Non-current assets and disposal groups are classified as held for sale when:
* they are available for immediate sale
* management is committed to a plan to sell
* it is unlikely that significant changes to the plan will be made or that the
plan will be withdrawn
* an active programme to locate a buyer has been initiated
* the asset or disposal group is being marketed at a reasonable price in
relation to its fair value
* a sale is expected to complete within 12 months from the date of
classification
Non-current assets and disposal groups classified as held for sale are measured
at the lower of:
* their carrying amount immediately prior to being classified as held for sale
in accordance with the Group's accounting policy
* fair value less costs to sell
Following their classification as held for sale, non-current assets (including
those in a disposal group) are not depreciated.
Results of operations disposed during the period are included in the
consolidated income statement up to the date of disposal.
A discontinued operation is a component of the Group's business that represents
a separate major line of business or geographical area of operations or its
subsidiary acquired exclusively with a view to resale, that has been disposed
of, has been abandoned or that meets the criteria to be classified as held for
sale.
Discontinued operations are presented in the income statement (including the
comparative period) as a single line which comprises the post-tax profit or loss
of the discontinued operation and the post-tax gain or loss recognised on the
re-measurement to fair value less costs to sell or on disposal of the
assets/disposal groups constituting discontinued operations.
Critical accounting estimates and judgments
The group makes certain estimates and assumptions regarding the future.
Estimates and judgments are continually evaluated based on historical experience
and other factors, including expectations of future events that are believed to
be reasonable under the circumstances in the future. Actual experience may
differ from these estimates and assumptions. The estimates and assumptions that
have a significant risk of causing a material adjustment to the carrying amounts
of assets and liabilities within the next financial period are discussed below.
Estimates and assumptions
Impairment of goodwill
The group is required to test, on an annual basis, whether goodwill has suffered
any impairment. The recoverable amount is determined based on value in use
calculations. The use of this method requires the estimation of future cash
flows and the choice of a discount rate in order to calculate the present value
of the cash flows. Actual outcomes may vary.
Going concern basis of preparation
The Group has prepared these financial statements on a going concern basis. The
Group's portfolio of products include some at early stage and not yet in the
marketplace. As such, there is a level of risk involved in bringing them to
market and no certainty that these products will be viable in the future. The
Ebiox business is more developed but has lacked the investment required to be
self-sustaining. Given the Group's continuing losses and the requirement for
refinancing, management's judgement on its ability to continue as a going
concern is a key assumption. Further details of the proposed refinancing are
given in the basis of preparation paragraphs in this note and note 9.
Share based payment
The group has equity-settled share-based remuneration schemes for employees.
Employee services received, and the corresponding increase in equity, are
measured by reference to the fair value of the equity instruments at the date of
grant, excluding the impact of any non-market vesting conditions. The fair value
of share options is estimated by using valuation models, such as Black-Scholes
and Cox-Rubenstein, on the date of grant based on certain assumptions. Those
assumptions include, among others, the dividend growth rate, expected
volatility, expected life of the options and number of options expected to vest.
Legal proceedings
In accordance with IFRS the group recognises a provision where there is a
present obligation from a past event, a transfer of economic benefits is
probable and the amount of costs of the transfer can be estimated reliably. In
instances where the criteria are not met, a contingent liability may be
disclosed in the notes to the financial statements. Obligations arising in
respect of contingent liabilities that have been disclosed, or those which are
not currently recognised or disclosed in the financial statements, could have a
material effect on the Group's financial position. Application of these
accounting principles to legal cases requires the Group's management to make
determinations about various factual and legal matters beyond its control. The
Group reviews outstanding legal cases following developments in the legal
proceedings at each balance sheet date, in order to assess the need for
provisions and disclosures in the financial statements. Among the factors
considered in making decisions on provisions are the nature of the litigation,
claim or assessment, the legal process and potential level of damages in the
jurisdiction in which the litigation, claim or assessment has been brought, the
progress of the case (including the progress after the date of the financial
statements but before those statements are issued), the opinions or views of
legal advisors, experience on similar cases and any decision of the Group's
management as to how it will respond to the litigation, claim or assessment.
3. Segmental reporting
Primary reporting format - business segments
+------------------------------------------+---------+-----------+---------+--
-------+----------+-------------+--------------+----------+----------+---------
+
| | | | |
| | | | | |
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| | Issued | Shares to |
Share | Deferred | Other | Translation | Retained | | Minority |
Total
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| Group | capital | be issued |
premium | shares | reserves | reserve | earnings | Total | interest
| equity
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| | GBP'000 | GBP'000 |
GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000
| GBP'000
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| | | |
| | | | | | |
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| At 1 March 2006 | 4,298 | 620 |
39,078 | 746 | (1,208) | - | (22,249) | 21,285 | 64
| 21,349
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| | | |
| | | | | | |
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| Exchange losses offset in reserves | - | - |
- | - | - | (58) | - | (58) | - |
(58)
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| | | |
| | | | | | |
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| Net income recognised directly in equity | - | - |
- | - | - | (58) | - | (58) | - |
(58)
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| | | |
| | | | | | |
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| Loss for the year | - | - |
- | - | - | - | (5,601) | (5,601) | (7) |
(5,608)
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| | | |
| | | | | | |
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| Total recognised expense for the year | - | - |
- | - | - | (58) | (5,601) | (5,659) | (7) |
(5,666)
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| | | |
| | | | | | |
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| Issue of shares | 3,220 | (349) |
2,952 | - | - | - | - | 5,823 | - |
5,823
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| Share based payments | 37 | - |
35 | - | 305 | - | - | 377 | - |
377
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| | | |
| | | | | | |
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| At 28 February 2007 | 7,555 | 271 |
42,065 | 746 | (903) | (58) | (27,850) | 21,826 | 57
| 21,883
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| | | |
| | | | | | |
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| | | |
| | | | | | |
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| Equity element of convertible debt | - | - |
- | - | 144 | - | - | 144 | - |
144
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| Exchange losses offset in reserves | - | - |
- | - | - | (10) | - | (10) | - |
(10)
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| Disposal | - | - |
- | - | - | - | - | - | 10 |
10
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| | | |
| | | | | | |
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| Net income recognised directly in equity | - | - |
- | - | 144 | (10) | - | 134 | 10 |
144
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| | | |
| | | | | | |
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| Loss for the period | - | - |
- | - | - | - | (19,886) | (19,886) | (67) |
(19,953) |
| | | |
| | | | | |
|
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| | | |
| | | | | | |
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| Total recognised expense for the year | - | - |
- | - | 144 | (10) | (19,886) | (19,752) | (57) |
(19,809) |
| | | |
| | | | | |
|
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| | | |
| | | | | | |
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| Issue of shares | 409 | (271) |
23 | - | - | - | - | 161 | - |
161 |
| | | |
| | | | | | |
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| Share based payments | - | - |
- | - | 75 | - | - | 75 | - |
75
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| Capital reorganisation | (7,625) | - |
- | 7,625 | - | - | - | - | - |
-
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| | | |
| | | | | | |
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| | | |
| | | | | | |
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| At 30 June 2008 | 339 | - |
42,088 | 8,371 | (684) | (68) | (47,736) | 2,310 | -
| 2,310
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
| | | |
| | | | | | |
|
| | | |
| | | | | | |
|
+------------------------------------------+---------+-----------+---------
----------+----------+-------------+--------------+----------+----------+------
---+
At 30 June 2008, the Group's operations are organised on a worldwide basis into
three main business segments. These segments are:
Ebiox - worldwide sale and distribution of disinfectant products (note that in
the 2007 financial statements figures for Ebiox included Alpha Trading (Asia)
Company Limited, an operation sold during the period to 30 June 2008).
Fertiligent - development of an early stage fertility medical device
Other and corporate - Portfolio investment, head office and other costs
There are immaterial sales between the business segments.
Segment assets include property, plant and equipment, intangible assets,
inventories, receivables and operating cash. Segment liabilities comprise trade
and other payables. Taxation, borrowings, provisions and non-current liabilities
are managed centrally and are included in the Other and corporate segment.
Capital expenditure comprises additions to property plant and equipment,
intangible assets and other investments.
The Crest Medical business was disposed of on 4 April 2008.
All revenue for the period comes from the sale of disinfectant products,
originating in the United Kingdom.
Secondary reporting format - geographical segments
The Group manages its business segments on a global basis. The operations are
based in three main geographical areas. The UK is the home country of the
parent. The main operations in the principal territories are as follows - UK,
Europe, and Rest of World.
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| Period ended 30 June 2008 | | | Rest | |
| | | | of | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| | UK | Europe | World | Total |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| | | | | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| Segment revenue | 7,036 | 602 | 223 | 7,861 |
| | | | | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| Less attributable to discontinued operations | (6,574) | (403) | (91) | (7,068) |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| | ________ | ________ | ________ | ________ |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| | | | | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| Segment revenue from continuing operations | 462 | 199 | 132 | 793 |
| | | | | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| | ________ | ________ | ________ | ________ |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| | | | | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| Total assets (including cash) | 6,265 | - | 214 | 6,479 |
| | | | | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| | | | | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| Capital expenditure relating to continuing | 14 | - | 112 | 126 |
| operations | | | | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| | | | | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| | | | | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| Year ended 28 February 2007 | | | Rest | |
| | | | of | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| | UK | Europe | World | Total |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| | | | | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| Segment revenue | 10,418 | 1,079 | 1,170 | 12,667 |
| | | | | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| Less attributable to discontinued operations | (10,079) | (983) | (1,048) | (12,110) |
| | | | | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| | ________ | ________ | ________ | ________ |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| | | | | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| Segment revenue from continuing operations | 339 | 96 | 122 | 557 |
| | | | | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| | ________ | ________ | ________ | ________ |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| | | | | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| Segment assets (including cash) | 18,016 | - | 202 | 18,218 |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| | | | | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| Crest Medical assets (2007) | | | | 9,059 |
| | | | | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| | | | | ________ |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| | | | | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| Total assets | | | | 27,277 |
| | | | | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| | | | | ________ |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| | | | | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| Capital expenditure relating to continuing | 96 | - | 190 | 286 |
| operations | | | | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
| | | | | |
+-----------------------------------------------+--------------------+-------------------------------------+----------------------------+----------------------+
4. Exceptional items
+-----------------------------------------------------------------+-------------------------------------------+----------------------------------------+
| | 2008 | 2007 |
+-----------------------------------------------------------------+-------------------------------------------+----------------------------------------+
| | GBP'000 | GBP'000 |
+-----------------------------------------------------------------+-------------------------------------------+----------------------------------------+
| Exceptional items relating to continuing operations | | |
+-----------------------------------------------------------------+-------------------------------------------+----------------------------------------+
| Employment costs | - | 598 |
+-----------------------------------------------------------------+-------------------------------------------+----------------------------------------+
| Reorganisation costs | 392 | 785 |
+-----------------------------------------------------------------+-------------------------------------------+----------------------------------------+
| Impairment of other assets | 1,092 | 762 |
+-----------------------------------------------------------------+-------------------------------------------+----------------------------------------+
| Disposals of investments | (170) | - |
| | | |
+-----------------------------------------------------------------+-------------------------------------------+----------------------------------------+
| Adjustments to contingent consideration | - | (1,265) |
+-----------------------------------------------------------------+-------------------------------------------+----------------------------------------+
| Impairment of goodwill | 9,652 | 1,470 |
+-----------------------------------------------------------------+-------------------------------------------+----------------------------------------+
| | _______ | _______ |
+-----------------------------------------------------------------+-------------------------------------------+----------------------------------------+
| | | |
+-----------------------------------------------------------------+-------------------------------------------+----------------------------------------+
| | 10,966 | 2,350 |
+-----------------------------------------------------------------+-------------------------------------------+----------------------------------------+
| | _______ | _______ |
+-----------------------------------------------------------------+-------------------------------------------+----------------------------------------+
| | | |
+-----------------------------------------------------------------+-------------------------------------------+----------------------------------------+
| Exceptional items relating to discontinued operations | | |
+-----------------------------------------------------------------+-------------------------------------------+----------------------------------------+
| Reorganisation costs | 637 | 808 |
+-----------------------------------------------------------------+-------------------------------------------+----------------------------------------+
| Impairment of Goodwill | 3,918 | - |
| | | |
+-----------------------------------------------------------------+-------------------------------------------+----------------------------------------+
| Loss on disposal of Crest Medical Limited | 249 | - |
| | | |
+-----------------------------------------------------------------+-------------------------------------------+----------------------------------------+
| | _______ | _______ |
+-----------------------------------------------------------------+-------------------------------------------+----------------------------------------+
| | | |
+-----------------------------------------------------------------+-------------------------------------------+----------------------------------------+
| | 4,804 | 808 |
+-----------------------------------------------------------------+-------------------------------------------+----------------------------------------+
| | _______ | _______ |
+-----------------------------------------------------------------+-------------------------------------------+----------------------------------------+
2008 Exceptional items
In October 2007 the Group's bankers requested early repayment of their loan.
After a strategic review and refinancing, management decided to restructure the
Group and to realise some of its value by selected asset sales. As part of this
financial and operational restructuring the group incurred reorganisation costs
of GBP1.0m, GBP0.4m of which related to the continuing operations of the Group.
During the period the continuing Group impaired investments of GBP0.8m, goodwill
of GBP9.7m and other intangible assets of GBP0.3m in respect of continuing
operations. There was also a prior year adjustment of GBP1.5m to write down
goodwill (see note 10) that has been recognised in 2007.
Disposals of investments comprises the sales of Alpha Trading (Asia) Limited,
the assets of Cross Infection Control Systems and shares in First Aid Holdings
Limited. The Group holds shares in First Aid Holdings Limited as consideration
for the sale of Crest Medical (see below).
The Crest Medical business incurred reorganisation costs of GBP0.6m to enable
its sale in April 2008. At the time of the reorganisation the carrying value of
the goodwill held by the Group was reviewed and was written down by GBP3.9m.
The Crest Medical business was sold for 980,000 shares worth GBP2.45m in First
Aid Holdings Limited the Company that now owns Crest Medical Limited. An
exceptional loss of GBP249,000 has been incurred in respect of the sale (see
note 5). During the period 90,000 shares in First Aid Holdings Limited were
disposed of at GBP2 each.
2007 Exceptional items
In 2007 the Group incurred an exceptional charge of GBP305,000 in respect of
share options and costs of GBP293,000 in respect of compensation for loss of
office.
In 2007 the Group refocused its Healthcare distribution business in Warrington
and moved away from low margin contracts incurring reorganisation costs of
GBP1.6m of which GBP0.8m related to continuing operations.
Contingent consideration relating to the Crest Medical business, purchased in
2004, of GBP1.3m was released as an exceptional item, as the corresponding
goodwill had been impaired. This related to a payment that depended on the
renewal, which was not achieved, of a significant contract.
After a review by management the carrying value of the Group's investment in
Ridgecrest Healthcare Group Incorporated was written down by GBP762,000.
5. Discontinued operations
The Crest Medical business was sold in the period and is a discontinued
operation. As a result, revenue for this business is excluded from the income
statement and the results of the business, including any associated exceptional
items, are recorded in a single line on a post-tax basis. Crest Medical was sold
on 4 April 2008.
+---------------------------------------------------------------------+-------------------------------------------------------------+
| | 2008 |
+---------------------------------------------------------------------+-------------------------------------------------------------+
| | Crest |
+---------------------------------------------------------------------+-------------------------------------------------------------+
| | Medical |
+---------------------------------------------------------------------+-------------------------------------------------------------+
| | GBP'000 |
+---------------------------------------------------------------------+-------------------------------------------------------------+
| | |
+---------------------------------------------------------------------+-------------------------------------------------------------+
| Consideration received (shares in First Aid Holdings Limited) | 2,450 |
+---------------------------------------------------------------------+-------------------------------------------------------------+
| | |
+---------------------------------------------------------------------+-------------------------------------------------------------+
| | |
+---------------------------------------------------------------------+-------------------------------------------------------------+
| Net assets disposed (excluding cash): | |
+---------------------------------------------------------------------+-------------------------------------------------------------+
| Goodwill | 2,619 |
+---------------------------------------------------------------------+-------------------------------------------------------------+
| Property, plant and equipment | 253 |
+---------------------------------------------------------------------+-------------------------------------------------------------+
| Inventories | 565 |
+---------------------------------------------------------------------+-------------------------------------------------------------+
| Trade and other Receivables | 574 |
+---------------------------------------------------------------------+-------------------------------------------------------------+
| Cash at bank | (25) |
+---------------------------------------------------------------------+-------------------------------------------------------------+
| Trade and other payables | (1,046) |
+---------------------------------------------------------------------+-------------------------------------------------------------+
| Other financial liabilities | (241) |
+---------------------------------------------------------------------+-------------------------------------------------------------+
| | _______ |
+---------------------------------------------------------------------+-------------------------------------------------------------+
| | |
+---------------------------------------------------------------------+-------------------------------------------------------------+
| Pre-tax loss on disposal | (249) |
+---------------------------------------------------------------------+-------------------------------------------------------------+
| | _______ |
+---------------------------------------------------------------------+-------------------------------------------------------------+
| | |
+---------------------------------------------------------------------+-------------------------------------------------------------+
| The net cash outflow comprises: | |
+---------------------------------------------------------------------+-------------------------------------------------------------+
| Cash disposed of | 25 |
+---------------------------------------------------------------------+-------------------------------------------------------------+
| | |
+---------------------------------------------------------------------+-------------------------------------------------------------+
A breakdown of losses from discontinued operations is shown below:
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| | 2008 | 2007 |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| | Crest | Crest |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| | Medical | Medical |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| | GBP'000 | GBP'000 |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| | | |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| Revenue | 7,068 | 11,717 |
| | | |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| | | |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| Operating loss before Exceptional items | (1,824) | (711) |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| Exceptional items | (4,804) | (808) |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| | _______ | _______ |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| | | |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| Operating profit after exceptional items | (6,628) | (1,519) |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| | _______ | _______ |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| | | |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| Finance costs | (62) | (11) |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| | _______ | _______ |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| | | |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| Loss before taxation | (6,690) | (1,530) |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| | _______ | _______ |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| | | |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| Taxation | - | - |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| | _______ | _______ |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| | | |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| Net loss | (6,690) | (1,530) |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| | _______ | _______ |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| | | |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| Minority interest | - | - |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| | _______ | _______ |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| | | |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| | (6,690) | (1,530) |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| | _______ | _______ |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
| | | |
+------------------------------------------------------------+------------------------------------------------------+------------------------------------------------+
A breakdown of cash flows from discontinued operations is shown below:
+------------------------------------------------------------+----------------------------------------+-------------------------------------------+
| | 2008 | 2007 |
+------------------------------------------------------------+----------------------------------------+-------------------------------------------+
| | Crest | Crest |
+------------------------------------------------------------+----------------------------------------+-------------------------------------------+
| | Medical | Medical |
+------------------------------------------------------------+----------------------------------------+-------------------------------------------+
| | GBP'000 | GBP'000 |
+------------------------------------------------------------+----------------------------------------+-------------------------------------------+
| | | |
+------------------------------------------------------------+----------------------------------------+-------------------------------------------+
| Cash flows from operating activities | (547) | (465) |
+------------------------------------------------------------+----------------------------------------+-------------------------------------------+
| Cash flows from investing activities | (80) | (71) |
+------------------------------------------------------------+----------------------------------------+-------------------------------------------+
| Cash flows from funding activities | 26 | 681 |
+------------------------------------------------------------+----------------------------------------+-------------------------------------------+
| | _______ | _______ |
+------------------------------------------------------------+----------------------------------------+-------------------------------------------+
| | | |
+------------------------------------------------------------+----------------------------------------+-------------------------------------------+
| | (601) | 145 |
+------------------------------------------------------------+----------------------------------------+-------------------------------------------+
| | _______ | _______ |
+------------------------------------------------------------+----------------------------------------+-------------------------------------------+
| | | |
+------------------------------------------------------------+----------------------------------------+-------------------------------------------+
6. Loss per share
(a) Basic loss per share
+------------------------------------------------------------+----------------------+-------------------------+
| | 2008 | 2007 |
+------------------------------------------------------------+----------------------+-------------------------+
| | GBP'000 | GBP'000 |
+------------------------------------------------------------+----------------------+-------------------------+
| | | |
+------------------------------------------------------------+----------------------+-------------------------+
| Loss attributable to equity holders of the Company | (19,886) | (5,608) |
+------------------------------------------------------------+----------------------+-------------------------+
| Discontinued operations | 6,690 | 1,530 |
| | | |
+------------------------------------------------------------+----------------------+-------------------------+
| | | |
+------------------------------------------------------------+----------------------+-------------------------+
| | ________ | ________ |
+------------------------------------------------------------+----------------------+-------------------------+
| Loss attributable to equity holders | | |
+------------------------------------------------------------+----------------------+-------------------------+
| of the Company from continuing operations | (13,196) | (4,078) |
+------------------------------------------------------------+----------------------+-------------------------+
| | ________ | ________ |
+------------------------------------------------------------+----------------------+-------------------------+
| | | |
+------------------------------------------------------------+----------------------+-------------------------+
The weighted average number of ordinary shares in issue during the period was
310,862,862 (2007: 213,698,645).
(b) Diluted loss per share
Because the inclusion of potential ordinary shares would decrease the basic loss
per ordinary share they are not deemed to be dilutive and accordingly the basic
and diluted loss per ordinary share are identical.
7. Financial liabilities - loan capital and borrowings
Financial liabilities comprise the following:
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | Group | Group |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | 2008 | 2007 |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | GBP'000 | GBP'000 |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| GBP0.5m 8% secured loan notes 2008 | 490 | - |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| GBP1.5m loan facility 2007 | - | 1,500 |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| GBP1.75m 8% convertible unsecured loan notes 2012 | 1,600 | - |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| GBP0.3m other unsecured loans | 300 | - |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| Other (including accrued interest) | 59 | 21 |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| Obligations under finance leases | - | 11 |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| Invoice discounting | - | 584 |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | _____ | _____ |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| Total | 2,449 | 2,116 |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | _____ | _____ |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| Borrowings repayable: | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| Within one year or on demand | 549 | 2,116 |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| Between one and two years | - | - |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| Between two and five years | 1,900 | - |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | _____ | _____ |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| Total | 2,449 | 2,116 |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | _____ | _____ |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| Current | 549 | 2,116 |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| Non-current | 1,900 | - |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | _____ | _____ |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| Total | 2,449 | 2,116 |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | _____ | _____ |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| Unsecured convertible loan notes | 1,600 | - |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| Secured loan notes | 500 | - |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| Other unsecured borrowings | 349 | 2,105 |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| Obligations under finance leases | - | 11 |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | _____ | _____ |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | 2,449 | 2,116 |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | _____ | _____ |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| Gross borrowings repayable (including interest): | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| Within one year or on demand | 755 | 2,199 |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| Between one and two years | 176 | - |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| Between two and five years | 2,490 | - |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | _____ | _____ |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | 3,421 | 2,199 |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | _____ | _____ |
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
| | | |
+------------------------------------------------------------+---------------------------------------------------+---------------------------------------------------------------+
Facilities and loan notes above are shown net of their associated fees and
equity components. An equity component of GBP144,000 has been recognised for the
GBP0.5m 2008 loan notes and the GBP1.75m 2012 convertible loan notes which has
been classified as other reserves in accordance with IAS 32 and will be
amortised to the consolidated income statement over the respective lives of the
loan notes. Fair value at inception is calculated discounting estimated future
cashflows using a market rate of interest (10%). The holders of the convertible
debt have the option at any point before maturity to exchange debt with a face
value of GBP1 for 80 0.1p ordinary shares in the company.
There were no defaults during the period on the GBP1.75m convertible loan notes,
the GBP0.5m loan notes or the GBP0.3m other loans or on the interest payable
from these loans.
8. Called up share capital
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| Group | 2008 | 2007 |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| Authorised | GBP'000 | GBP'000 |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| | | |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| 800,000,000 ordinary shares of 2.5p each | - | 20,000 |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| 800,000,000 ordinary shares of 0.1p each | 800 | - |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| 186,502,731 deferred shares of 0.4p each | 746 | 746 |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| 317,706,532 deferred shares of 2.4p each | 7,625 | - |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| | ______ | ______ |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| | | |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| | 9,171 | 20,746 |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| | ______ | ______ |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| | | |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| Group | 2008 | 2007 |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| Allotted, called up and fully paid | GBP'000 | GBP'000 |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| | | |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| Ordinary shares | | |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| 339,099,622 ordinary shares of 0.1p each | | |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| (2007: 302,216,720 ordinary shares of 2.5p each) | 339 | 7,555 |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| | | |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| Deferred shares | | |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| 186,502,731 deferred shares of 0.4p each | 746 | 746 |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| 317,706,532 deferred shares of 2.4p each | 7,625 | - |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| | ______ | ______ |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| | | |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| | 8,371 | 746 |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| | ______ | ______ |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
| | | |
+------------------------------------------------------------+------------------------------------------+------------------------------------------------------------------+
+------------------------------------------------------------+---------------+---------------------------------------------------------+
| | Ordinary | Ordinary |
| | shares | shares |
+------------------------------------------------------------+---------------+---------------------------------------------------------+
| Group | of 2.5p | of |
| | | 0.1p |
+------------------------------------------------------------+---------------+---------------------------------------------------------+
| | '000 | '000 |
+------------------------------------------------------------+---------------+---------------------------------------------------------+
| | | |
+------------------------------------------------------------+---------------+---------------------------------------------------------+
| At 1 March 2007 | 302,217 | - |
| | | |
+------------------------------------------------------------+---------------+---------------------------------------------------------+
| | | |
+------------------------------------------------------------+---------------+---------------------------------------------------------+
| Share issues | 15,490 | - |
| | | |
+------------------------------------------------------------+---------------+---------------------------------------------------------+
| Share conversion | (317,707) | 317,707 |
| | | |
+------------------------------------------------------------+---------------+---------------------------------------------------------+
| Share issues | - | 21,393 |
| | | |
+------------------------------------------------------------+---------------+---------------------------------------------------------+
| | _________ | _________ |
+------------------------------------------------------------+---------------+---------------------------------------------------------+
| | | |
+------------------------------------------------------------+---------------+---------------------------------------------------------+
| At 30 June 2008 | - | 339,100 |
| | | |
+------------------------------------------------------------+---------------+---------------------------------------------------------+
| | _________ | _________ |
+------------------------------------------------------------+---------------+---------------------------------------------------------+
| | | |
+------------------------------------------------------------+---------------+---------------------------------------------------------+
During the period the Company underwent a capital reorganisation to allow it to
access increased funding opportunities. Each ordinary share of 2.5p was
subdivided into one ordinary share of 0.1p and one deferred share of 2.4p.
The rights of the holders of the 0.4p deferred shares are set out below:
* The holder is not entitled to receive any dividend or other distribution;
* The holder is not entitled to receive any notice of or to attend, speak or
vote at any general meeting of the Company;
* The holder is entitled to a return of capital on liquidation or capital
reductions.
The 0.4p deferred shares are presented as shareholders' equity.
The rights of the holders of the 2.4p deferred shares are set out below:
* The holder is not entitled to receive any dividend or other distribution;
* The holder is not entitled to receive any notice of or to attend, speak or
vote at any general meeting of the Company;
* The holder is entitled to a return of capital on liquidation only after the
amount paid to holders of ordinary shares has exceeded GBP10,000.
* The 2.4p deferred shares may not be transferred
The 2.4p deferred shares are presented as shareholders' equity.
Shares to be allotted
+------------------------------------------------------------+------------------------------+--------------------------+
| | 2008 | 2007 |
+------------------------------------------------------------+------------------------------+--------------------------+
| | GBP'000 | GBP'000 |
+------------------------------------------------------------+------------------------------+--------------------------+
| | | |
+------------------------------------------------------------+------------------------------+--------------------------+
| Shares to be allotted | - | 271 |
+------------------------------------------------------------+------------------------------+--------------------------+
| | | |
+------------------------------------------------------------+------------------------------+--------------------------+
During the period 12,477,876 ordinary shares of 2.5p each were issued in respect
of CICS deferred consideration valued at GBP160,000.
9. Post balance sheet events
Since the period end the Group has been funded by loans from supportive
shareholders and selective sale of investments, most significantly those in
First Aid Holdings Limited ("FAH"). The Group is currently in engaged in a
process of refinancing whereby it is proposed that certain significant
liabilities, including convertible unsecured loan stock, held by Healthcare
Enterprise Group plc ("HCEG") will be converted into a combination of equity in
HCEG, Ebiox Limited, Reproductive Sciences Limited and FAH.
The value realised in the refinancing for part of the Group's economic interest
in Ebiox Limited is expected by the directors to be significantly below the
valuation of the Group's economic interest as at 30 June 2008. However it the
directors' opinion that this is due to conditions and events since 30 June 2008
and the changes will be reflected in the financial statements to 30 June 2009.
The potential impairment to be recognised is estimated by directors to be
GBP0.7m.
Also since the period end the Group has continued the selective sales of its
shares in FAH. The value achieved for recent sales has been GBP1.25 a share,
significantly below the GBP2.00 a share at which the shares were held in these
financial statements. The GBP2.00 a share valuation at the period end is
supported by sales at this value in July 2008. The potential impairment to be
recognised is estimated by directors to be GBP0.6m.
10. First time adoption of International Financial Reporting Standards (IFRSs)
(a) Introduction
The Group and Company financial statements have been prepared in accordance with
IFRSs and are presented in UK sterling. The reconciliations on pages 26 to 29
have been prepared on the basis that all IFRSs, International Financial
Reporting Interpretation Committee (IFRIC) interpretations, and current IASB
exposure drafts will be issued as final standards and adopted by the European
Commission.
The main differences between the Group and Company financial statements prepared
according to UK GAAP and those under IFRS are:
- the separation of convertible debt into an equity component that is
amortised across the life of the instrument and debt (No convertible debt at 28
February 2007 or at 1 March 2006).
- the reclassification of interest as part of net debt (interest payable was
GBP21,000 at 28 February 2007 and GBPnil at 1 March 2006).
(b) Transition date and first time adoption of IFRSs
The transition date to IFRS is 1 March 2006. All adjustments on first-time
adoption were recorded in shareholders' equity on the date of transition.
IFRS 1 'First-Time Adoption of International Financial Reporting Standards' sets
out the transition rules which must be applied when IFRSs are adopted for the
first time. Certain of the requirements and options in IFRSs may result in a
different application of accounting policies in the 2006 restated financial
information from that which would apply if the 2006 financial statements were
the first financial statements. The standard sets out certain mandatory
exemptions to retrospective application and certain optional exemptions. The
most significant optional exemptions available that have been taken by the group
and the parent company are as follows:
Business combinations
Business combinations effected before 1 March 2006, including those that were
accounted for using the merger method of accounting under UK accounting
standards, have not been restated.
The carrying amount of capitalised goodwill at 28 February 2006 that arose on
business combinations accounted for using the acquisition method under UK GAAP
was frozen at this amount and tested for impairment at 1 March 2006.
(c) Explanation of principal differences between the cashflow statements
presented under UK GAAP and the cashflow statements presented under IFRSs
The cash flow statement has been prepared in conformity with IAS7 'Cash Flow
Statements.' The principal differences between the 2007 cash flow statement
presented in accordance with UK GAAP and the cash flow statement presented in
accordance with IFRSs for the same periods are as follows:
Under UK GAAP, net cash flow from operating activities was determined before
considering cash outflows from (a) returns on investments and servicing of
finance, and (b) taxes paid. Under IFRSs, these two sections of the cash flow
statement do not exist and the related cash flows are categorised as operating,
investing or financing as appropriate. Under UK GAAP, acquisitions are
separately classified, while under IFRSs, they are included within investing
activities.
Reconciliation of loss for the year ended 28 February 2007
During the period to 30 June 2008 the Crest Medical business met the criteria to
be classified as a discontinued operation held for sale. The comparative 2007
information disclosed in the primary statements and notes reflects this
classification. The increase in the operating loss for the Group in 2007 relates
to an increase in the impairment charge in respect of goodwill upon retesting on
transition to IFRS, the increase in the operating loss for the Company in 2007
relates to an impairment of investments in subsidiaries.
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | Group | | |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | after | Group | Group |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | exceptionals | effect | after |
| | | of | |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | Previous | transition | exceptionals |
| | | to | |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | GAAP | IFRS | IFRS |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| Continuing operations | GBP'000 | GBP'000 | GBP'000 |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | | | |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| Revenue | 557 | - | 557 |
| | | | |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | | | |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| Cost of Sales | (220) | - | (220) |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | _______ | _______ | _______ |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | | | |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| Gross profit | 337 | - | 337 |
| | | | |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | _______ | _______ | _______ |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | | | |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| Other administrative expenses | (2,832) | (1,470) | (4,302) |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | _______ | _______ | _______ |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | | | |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| Operating loss | (2,495) | (1,470) | (3,965) |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | _______ | _______ | _______ |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | | | |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| Finance costs | (101) | - | (101) |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | _______ | _______ | _______ |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | | | |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| Loss before tax | (2,596) | (1,470) | (4,066) |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | _______ | _______ | _______ |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | | | |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| Income tax expense | (5) | - | (5) |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | | | |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | _______ | _______ | _______ |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| Loss for the period | | | |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| from continuing operations | (2,601) | (1,470) | (4,071) |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | _______ | _______ | _______ |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | | | |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| Discontinued operations and | | | |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| non-current assets held for sale | (1,530) | - | (1,530) |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | _______ | _______ | _______ |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | | | |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| Loss for the period | (4,131) | (1,470) | (5,601) |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | _______ | _______ | _______ |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | | | |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| Attributable to: | | | |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| Equity holders of the parent | (4,138) | (1,470) | (5,608) |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| Minority interest | 7 | - | 7 |
| | | | |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | _______ | _______ | _______ |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | | | |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | (4,131) | (1,470) | (5,601) |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | _______ | _______ | _______ |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
| | | | |
+-----------------------------------------+------------------------------------------------------------------+------------------------------------------------------------------------------+---------------------------------------------------------------------------+
Reconciliation of equity at 1 March 2006
(Date of transition to IFRSs)
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | | Group | Error | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | Group | Effect | Under | |
| | | of | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | Previous | Transition | Previous | Group |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | GAAP | to | GAAP | IFRS |
| | | IFRS | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Assets | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Non-current assets | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Property, plant & equipment | 545 | - | - | 545 |
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Goodwill | 21,250 | - | - | 21,250 |
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Other intangible assets | 683 | - | - | 683 |
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Available for sale investments | 1,538 | - | - | 1,538 |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | 24,016 | - | - | 24,016 |
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Current assets | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Inventories | 2,096 | - | - | 2,096 |
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Trade receivables | 2,557 | - | - | 2,557 |
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Other current assets | 624 | - | - | 624 |
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Cash and cash equivalents | 489 | - | - | 489 |
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | 5,766 | - | - | 5,766 |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Total assets | 29,782 | - | - | 29,782 |
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Current liabilities | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Financial liabilities - | (2,325) | - | - | (2,325) |
| borrowings | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Trade and other payables | (3,232) | - | - | (3,232) |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Current tax payable | (49) | - | - | (49) |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | (5,606) | - | - | (5,606) |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Non-current liabilities | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Financial liabilities - | (1,152) | - | - | (1,152) |
| borrowings | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Other payables | (2,032) | - | 357 | (1,675) |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Deferred shares | (746) | - | 746 | - |
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | (3,930) | - | 1,103 | (2,827) |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Net assets | 20,246 | - | 1,103 | 21,349 |
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Equity attributable to | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| the equity holders of the parent | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Ordinary shares | 4,298 | - | - | 4,298 |
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Shares to be issued | 620 | - | - | 620 |
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Share premium | 39,078 | - | - | 39,078 |
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Deferred shares | - | - | 746 | 746 |
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Profit and loss account | (22,249) | - | - | (22,249) |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Other reserves | (1,565) | - | 357 | (1,208) |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | 20,182 | - | 1,103 | 21,285 |
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Minority interest | 64 | - | - | 64 |
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| Total equity | 20,246 | - | 1,103 | 21,349 |
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------------------------+----------------------------------------------------+--------------------------------------------------------+----------------------------------------+
Differences in the reconciliation above are reclassification of deferred shares
and warrants previously shown as Non-current liabilities to Equity. This is the
correction of an error under United Kingdom generally accepted accounting
practice. The decrease in intangible assets for the Group in 2007 relates to an
increase in the impairment charge in respect of goodwill upon retesting on
transition to IFRSs. The decrease in investments for the Company in 2007 relates
to an impairment of investments in subsidiaries.
Reconciliation of equity at 28 February 2007
(Date of transition to IFRSs)
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | | Group | Error | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | Group | Effect | Under | |
| | | of | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | Previous | Transition | Previous | Group |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | GAAP | to | GAAP | IFRS |
| | | IFRS | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Assets | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Non-current assets | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Property, plant & equipment | 428 | - | - | 428 |
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Goodwill | 20,959 | (1,470) | - | 19,489 |
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Other intangible assets | 843 | - | - | 843 |
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Available for sale investments | 682 | - | - | 682 |
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | 22,912 | - | - | 21,442 |
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Current assets | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Inventories | 1,834 | - | - | 1,834 |
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Trade receivables | 1,570 | - | - | 1,570 |
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Other current assets | 1,741 | - | - | 1,741 |
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Cash and cash equivalents | 690 | - | - | 690 |
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | 5,835 | - | - | 5,835 |
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Total assets | 28,747 | (1,470) | - | 27,277 |
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Current liabilities | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Financial liabilities - | (2,116) | - | - | (2,116) |
| borrowings | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Trade and other payables | (3,209) | - | - | (3,209) |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Current tax payable | (36) | - | - | (36) |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | (5,361) | - | - | (5,361) |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Non-current liabilities | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Financial liabilities - | - | - | - | - |
| borrowings | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Other payables | (390) | - | 357 | (33) |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Deferred shares | (746) | - | 746 | - |
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | (1,136) | - | 1,103 | (33) |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Net assets | 22,250 | (1,470) | 1,103 | 21,883 |
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Equity attributable to | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| the equity holders of the parent | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Ordinary shares | 7,555 | - | - | 7,555 |
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Shares to be issued | 271 | - | - | 271 |
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Share premium | 42,065 | - | - | 42,065 |
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Deferred shares | - | - | 746 | 746 |
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Profit and loss account | (26,438) | (1,470) | - | (27,908) |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Other reserves | (1,260) | - | 357 | (903) |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | 22,193 | (1,470) | 1,103 | 21,826 |
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Minority interest | 57 | - | - | 57 |
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| Total equity | 22,250 | (1,470) | 1,103 | 21,883 |
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | ________ | _______ | _______ | ________ |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
| | | | | |
+----------------------------------+----------------------------------------+----------------------------------------------------+-----------------------------------------------+----------------------------------------+
The only significant differences in the reconciliation above are the
reclassification of deferred shares and warrants previously shown as Non-current
liabilities to Equity and a further write down of goodwill in respect of Safatec
(UK) Limited upon transition to IFRSs. This is the correction of an error under
United Kingdom generally accepted accounting practice.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR SEWFLUSUSEFI
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