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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Islamic Bank | LSE:IBB | London | Ordinary Share | GB00B02KNV97 | ORD 1P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 1.425 | 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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TIDMIBB
RNS Number : 0746T
Islamic Bank of Britain Plc
22 September 2010
ISLAMIC BANK OF BRITAIN PLC ("IBB" or "the Bank")
Interim Results
Islamic Bank of Britain PLC (the "Company") is pleased to announce its interim
results for the 6 month period ended 30 June 2010.
The interim report will be available from the Company's website,
www.islamic-bank.com
For further information please contact:
Gerry Deegan, Islamic Bank of Britain Plc
(tel: 0121 452 7300)
Gerald Beaney/David Hignell, Grant Thornton Corporate Finance (Nominated
Adviser)
(tel: 020 7383 5100)
Chairman's statement
I am pleased to present the Interim Report of Islamic Bank of Britain PLC,
("IBB" or "the Bank"), for the six months ended 30 June 2010. The challenging
economic environment continued to impact the Bank's financial performance during
the period. As indicated in IBB's annual report for the year ended 31 December
2009, the Bank has been working with its advisors to raise additional capital.
I am pleased to report that on 17 August 2010 IBB successfully raised capital of
GBP20m via a placing of new shares with Qatar International Islamic Bank
("QIIB"). QIIB is an established Islamic bank and a founding shareholder. We
welcome their strategic support. This provides IBB with sufficient capital for
its current requirements.
The Bank has continued to achieve growth in finance assets during the six months
to 30 June 2010 whilst ensuring the adequacy of its capital resources and
achieving modest growth in customer deposits.
Highlights
· GBP20m of new equity capital raised (before expenses)
· Customer financing increased by 19% to GBP54.8m
· Deposits increased by 3% to GBP193m
Current environment and trading performance
Ongoing market conditions continue to impact the Bank's revenues. Despite the
UK economy officially exiting recession in Q1 2010, yields in the Islamic
Inter-bank markets have remained at historic lows. This has resulted in a
reduction in net income from Islamic financing transactions to GBP0.5m (6 month
period to 30 June 2009: GBP0.8m). The Bank has implemented specific measures
during the period to counter the reduction in operating income including cost
reductions by improving operational efficiencies. These measures resulted in a
decrease in operating expenses to GBP5.0m (6 month period to 30 June 2009:
GBP5.6m).
Consequently the loss for the period decreased to GBP4.3m (6 month period to 30
June 2009: GBP4.6m).
Products
The Bank made steady progress against its key business objectives of achieving
growth in finance assets. The Home Purchase Plan ("HPP") product continues to
be the key focus for achieving asset growth. HPP assets increased to GBP43.2m
(31 December 2009: GBP33.1m). The Bank has maintained prudent credit policies
and consequently there are currently no arrears within the secured finance
portfolios.
Capital
New capital of GBP20m was raised via a placing of shares on 17 August 2010.
Whilst this provides IBB with sufficient capital for its current requirements,
the Bank is currently conducting a strategic review of its operations in order
to ensure that its capital resources are deployed in the most effective manner.
Outlook
The Board expects the challenging market conditions to persist through the
remainder of the financial year. In addition to the ongoing strategic review,
the directors and management team will continue to identify opportunities to
mitigate the impact of these market conditions.
Finally, I would like to extend my thanks and gratitude to IBB customers,
shareholders, Sharia Supervisory Committee scholars, and employees for their
continued support and commitment to the Bank.
Mohsen Moustafa
21 September 2010
Chairman
Condensed statement of comprehensive income
for the 6 month period ended 30 June 2010
+---------------------------------------+------+--------------------------+-------------+------------------+
| |Note | 6 month | 6 month | |
| | | | | Year |
| | | period | period | ended |
| | | ended | ended | 31 Dec |
| | | 30 Jun | 30 Jun | 2009 |
| | | 2010 | 2009 | |
+---------------------------------------+------+--------------------------+-------------+------------------+
| | | GBP | GBP | GBP |
+---------------------------------------+------+--------------------------+-------------+------------------+
| | | | | |
+---------------------------------------+------+--------------------------+-------------+------------------+
| Income receivable from Islamic | | 1,534,060 | 1,692,414 | 3,017,012 |
| financing transactions | | | | |
+---------------------------------------+------+--------------------------+-------------+------------------+
| Returns payable to customers and | | (1,004,796) | (880,541) | (1,807,271) |
| banks | | | | |
+---------------------------------------+------+--------------------------+-------------+------------------+
| | | | | |
+---------------------------------------+------+--------------------------+-------------+------------------+
| Net income from Islamic financing | | 529,264 | 811,873 | 1,209,741 |
| transactions | | | | |
+---------------------------------------+------+--------------------------+-------------+------------------+
| | | | | |
+---------------------------------------+------+--------------------------+-------------+------------------+
| Fee and commission income | | 205,286 | 233,243 | 480,591 |
+---------------------------------------+------+--------------------------+-------------+------------------+
| Fee and commission expense | | (39,571) | (37,974) | (86,939) |
+---------------------------------------+------+--------------------------+-------------+------------------+
| | | | | |
+---------------------------------------+------+--------------------------+-------------+------------------+
| Net fee and commission income | | 165,715 | 195,269 | 393,652 |
+---------------------------------------+------+--------------------------+-------------+------------------+
| | | | | |
+---------------------------------------+------+--------------------------+-------------+------------------+
| Operating income | | 694,979 | 1,007,142 | 1,603,393 |
+---------------------------------------+------+--------------------------+-------------+------------------+
| | | | | |
+---------------------------------------+------+--------------------------+-------------+------------------+
| Net impairment loss on financial | 5 | (102,293) | (200,637) | (408,939) |
| assets | | | | |
+---------------------------------------+------+--------------------------+-------------+------------------+
| Personnel expenses | | (2,561,185) | (2,601,307) | (5,241,104) |
+---------------------------------------+------+--------------------------+-------------+------------------+
| General and administrative expenses | | (1,901,164) | (2,202,997) | (4,314,807) |
+---------------------------------------+------+--------------------------+-------------+------------------+
| Depreciation | | (343,618) | (370,228) | (724,477) |
+---------------------------------------+------+--------------------------+-------------+------------------+
| Amortisation | | (130,994) | (254,602) | (406,810) |
+---------------------------------------+------+--------------------------+-------------+------------------+
| | | | | |
+---------------------------------------+------+--------------------------+-------------+------------------+
| Total operating expenses | | (5,039,254) | (5,629,771) | (11,096,137) |
+---------------------------------------+------+--------------------------+-------------+------------------+
| | | | | |
+---------------------------------------+------+--------------------------+-------------+------------------+
| Loss before income tax | | (4,344,275) | (4,622,629) | (9,492,744) |
+---------------------------------------+------+--------------------------+-------------+------------------+
| | | | | |
+---------------------------------------+------+--------------------------+-------------+------------------+
| Income tax expense | 3 | | - | - |
| | | - | | |
+---------------------------------------+------+--------------------------+-------------+------------------+
| | | | | |
+---------------------------------------+------+--------------------------+-------------+------------------+
| Loss for the period | | (4,344,275) | (4,622,629) | (9,492,744) |
+---------------------------------------+------+--------------------------+-------------+------------------+
| | | | | |
+---------------------------------------+------+--------------------------+-------------+------------------+
| Total comprehensive income for the | | (4,344,275) | (4,622,629) | (9,492,744) |
| period | | | | |
+---------------------------------------+------+--------------------------+-------------+------------------+
| | | | | |
+---------------------------------------+------+--------------------------+-------------+------------------+
| Loss attributable to Owners of the | | (4,344,275) | (4,622,629) | (9,492,744) |
| Company | | | | |
+---------------------------------------+------+--------------------------+-------------+------------------+
| Total comprehensive income | | (4,344,275) | (4,622,629) | (9,492,744) |
| attributable to Owners of the Company | | | | |
+---------------------------------------+------+--------------------------+-------------+------------------+
| | | | | |
+---------------------------------------+------+--------------------------+-------------+------------------+
| Loss per ordinary share | | | | |
+---------------------------------------+------+--------------------------+-------------+------------------+
| Basic and diluted (pence) | 2 | (0.8) | (0.9) | (1.8) |
+---------------------------------------+------+--------------------------+-------------+------------------+
| | | | | |
+---------------------------------------+------+--------------------------+-------------+------------------+
All income and expenditure relates to continuing operations.
Condensed statement of financial position
At 30 June 2010
+----------------------------------+------+-----------------------+--------------+--------------+
| |Note | 30 Jun | 30 Jun | 31 Dec |
| | | 2010 | 2009 | 2009 |
+----------------------------------+------+-----------------------+--------------+--------------+
| | | GBP | GBP | GBP |
+----------------------------------+------+-----------------------+--------------+--------------+
| | | | | |
+----------------------------------+------+-----------------------+--------------+--------------+
| Assets | | | | |
+----------------------------------+------+-----------------------+--------------+--------------+
| Cash | | 867,788 | 460,974 | 577,273 |
+----------------------------------+------+-----------------------+--------------+--------------+
| Commodity Murabaha and Wakala | | 149,756,121 | 162,779,424 | 155,951,375 |
| receivables and | | | | |
| other advances due from | | | | |
| banks | | | | |
+----------------------------------+------+-----------------------+--------------+--------------+
| Consumer finance accounts and | | 3,275,715 | 6,062,688 | 4,488,744 |
| other advances to customers | | | | |
+----------------------------------+------+-----------------------+--------------+--------------+
| Net investment in home purchase | | 43,164,607 | 14,412,247 | 33,077,501 |
| plans | | | | |
+----------------------------------+------+-----------------------+--------------+--------------+
| Net investment in commercial | | 8,382,470 | 8,774,552 | 8,611,393 |
| property finance | | | | |
+----------------------------------+------+-----------------------+--------------+--------------+
| Property and equipment | | 2,384,217 | 2,961,012 | 2,660,754 |
+----------------------------------+------+-----------------------+--------------+--------------+
| Intangible assets | | 212,122 | 426,405 | 315,541 |
+----------------------------------+------+-----------------------+--------------+--------------+
| Other assets | | 1,512,192 | 1,061,613 | 1,340,277 |
+----------------------------------+------+-----------------------+--------------+--------------+
| | | | | |
+----------------------------------+------+-----------------------+--------------+--------------+
| Total assets | | 209,555,232 | 196,938,915 | 207,022,858 |
+----------------------------------+------+-----------------------+--------------+--------------+
| | | | | |
+----------------------------------+------+-----------------------+--------------+--------------+
| Liabilities and equity | | | | |
+----------------------------------+------+-----------------------+--------------+--------------+
| | | | | |
+----------------------------------+------+-----------------------+--------------+--------------+
| Liabilities | | | | |
+----------------------------------+------+-----------------------+--------------+--------------+
| Deposits from banks | 6 | 614,388 | 975,534 | 609,292 |
+----------------------------------+------+-----------------------+--------------+--------------+
| Deposits from customers | 7 | 192,342,914 | 171,355,388 | 185,975,992 |
+----------------------------------+------+-----------------------+--------------+--------------+
| Other liabilities | | 4,121,335 | 2,939,692 | 3,623,541 |
+----------------------------------+------+-----------------------+--------------+--------------+
| | | | | |
+----------------------------------+------+-----------------------+--------------+--------------+
| Total liabilities | | 197,078,637 | 175,270,614 | 190,208,825 |
+----------------------------------+------+-----------------------+--------------+--------------+
| | | | | |
+----------------------------------+------+-----------------------+--------------+--------------+
| Equity | | | | |
+----------------------------------+------+-----------------------+--------------+--------------+
| Called up share capital | 8 | 5,464,700 | 5,464,700 | 5,464,700 |
+----------------------------------+------+-----------------------+--------------+--------------+
| Share premium | | 54,806,652 | 54,806,652 | 54,806,652 |
+----------------------------------+------+-----------------------+--------------+--------------+
| Retained deficit | | (47,840,078) | (38,646,801) | (43,502,640) |
+----------------------------------+------+-----------------------+--------------+--------------+
| Profit stabilisation reserve | | 45,321 | 43,750 | 45,321 |
+----------------------------------+------+-----------------------+--------------+--------------+
| | | | | |
+----------------------------------+------+-----------------------+--------------+--------------+
| Total equity | | 12,476,595 | 21,668,301 | 16,814,033 |
+----------------------------------+------+-----------------------+--------------+--------------+
| | | | | |
+----------------------------------+------+-----------------------+--------------+--------------+
| Total equity and liabilities | | 209,555,232 | 196,938,915 | 207,022,858 |
+----------------------------------+------+-----------------------+--------------+--------------+
These financial statements were approved by the Board of Directors on 21
September 2010 and were signed on its behalf by:
Sultan Choudhury
Executive Director
Condensed statement of changes in equity
for the 6 month period ended 30 June 2010
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| |Note | Share | | Share | | Profit | | Profit | | Total |
| | | capital | | premium | | and | | stabilisation | | |
| | | | | account | | loss | | reserve | | |
| | | | | | | account | | | | |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| | | GBP | | GBP | | GBP | | GBP | | GBP |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| | | | | | | | | | | |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| | | | | | | | | | | |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| Balance at 1 January 2009 | | 4,190,000 | | 48,747,255 | | (34,046,165) | | 52,446 | | 18,943,536 |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| | | | | | | | | | | |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| Total comprehensive income | | - | | - | | (4,622,629) | | - | | (4,622,629) |
| for the period | | | | | | | | | | |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| Transfer to profit | | - | | - | | 8,696 | | (8,696) | | - |
| stabilisation reserve | | | | | | | | | | |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| Credit in respect of share | | - | | - | | 13,297 | | - | | 13,297 |
| based payments charge | | | | | | | | | | |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| Issue of ordinary share | | 1,274,700 | | 6,059,397 | | - | | - | | 7,334,097 |
| capital | | | | | | | | | | |
| | | | | | | | | | | |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| | | | | | | | | | | |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| Balance at 30 June 2009 | | 5,464,700 | | 54,806,652 | | (38,646,801) | | 43,750 | | 21,668,301 |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| | | | | | | | | | | |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| | | | | | | | | | | |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| Balance at 1 July 2009 | | 5,464,700 | | 54,806,652 | | (38,646,801) | | 43,750 | | 21,668,301 |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| | | | | | | | | | | |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| Total comprehensive income | | - | | - | | (4,870,115) | | - | | (4,870,115) |
| for the period | | | | | | | | | | |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| Transfer to profit | | - | | - | | (1,571) | | 1,571 | | - |
| stabilisation reserve | | | | | | | | | | |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| Credit in respect of share | | - | | - | | 15,847 | | - | | 15,847 |
| based payments charge | | | | | | | | | | |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| | | | | | | | | | | |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| Balance at 31 December | | 5,464,700 | | 54,806,652 | | (43,502,640) | | 45,321 | | 16,814,033 |
| 2009 | | | | | | | | | | |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| | | | | | | | | | | |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| | | | | | | | | | | |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| Balance at 1 January 2010 | | 5,464,700 | | 54,806,652 | | (43,502,640) | | 45,321 | | 16,814,033 |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| | | | | | | | | | | |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| Total comprehensive income | | - | | - | | (4,344,275) | | - | | (4,344,275) |
| for the period | | | | | | | | | | |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| Credit in respect of share | | - | | - | | 6,837 | | - | | 6,837 |
| based payments charge | | | | | | | | | | |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| | | | | | | | | | | |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
| Balance at 30 June 2010 | | 5,464,700 | | 54,806,652 | | (47,840,078) | | 45,321 | | 12,476,595 |
+----------------------------+------+-----------+-+------------+-+--------------+-+---------------+-+-------------+
Condensed statement of cash flows
for the 6 month period ended 30 June 2010
+--------------------------------+------+--------------+--------------------+--------------+
| |Note | 6 month | 6 month | |
| | | period | period | Year |
| | | ended | ended | ended |
| | | 30 Jun | 30 Jun | 31 Dec |
| | | 2010 | 2009 | 2009 |
+--------------------------------+------+--------------+--------------------+--------------+
| | | GBP | GBP | GBP |
+--------------------------------+------+--------------+--------------------+--------------+
| | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| Cash flows from operating | | | | |
| activities | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| Loss for the period | | (4,344,275) | (4,622,629) | (9,492,744) |
+--------------------------------+------+--------------+--------------------+--------------+
| Adjustments for: | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| Depreciation | | 343,618 | 370,228 | 724,477 |
+--------------------------------+------+--------------+--------------------+--------------+
| Amortisation | | 130,994 | 254,602 | 406,810 |
+--------------------------------+------+--------------+--------------------+--------------+
| Net impairment loss on | | 102,293 | 200,637 | 408,939 |
| financial assets | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| Share based payment charge | | 6,837 | 13,297 | 29,144 |
+--------------------------------+------+--------------+--------------------+--------------+
| | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| Change in Commodity Murabaha | | 6,874,990 | (10,036,319) | (3,151,765) |
| and Wakala receivables | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| Change in consumer finance | | 1,110,733 | 1,614,967 | 2,980,609 |
| accounts and other advances to | | | | |
| customers | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| Change in net investment in | | 228,923 | (176,659) | (13,500) |
| commercial property finance | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| Change in net investment in | | (10,087,106) | (7,431,407) | (26,096,661) |
| home purchase plans | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| Change in other assets | | (171,915) | 201,515 | (77,149) |
+--------------------------------+------+--------------+--------------------+--------------+
| Change in deposits from banks | | 5,096 | (4,118,585) | (4,484,827) |
+--------------------------------+------+--------------+--------------------+--------------+
| Change in deposits from | | 6,366,922 | 18,074,634 | 32,695,238 |
| customers | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| Change in other liabilities | | 497,794 | (541,199) | 142,650 |
+--------------------------------+------+--------------+--------------------+--------------+
| | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| Net cash used in operating | | 1,064,904 | (6,196,918) | (5,928,779) |
| activities | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| Cash flows from investing | | | | |
| activities | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| Purchase of property and | | (67,080) | (65,495) | (119,486) |
| equipment | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| Purchase of intangible assets | | (27,575) | (102,294) | (143,638) |
+--------------------------------+------+--------------+--------------------+--------------+
| | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| Net cash used in investing | | (94,655) | (167,789) | (263,124) |
| activities | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| Cash flows financing | | | | |
| activities | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| Issue of ordinary share | | - | 7,334,097 | 7,334,097 |
| capital | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| Net cash generated from | | - | 7,334,097 | 7,334,097 |
| financing activities | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| Net change in cash and cash | | 970,249 | 969,390 | 1,142,194 |
| equivalents | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| Foreign exchange losses | | (895) | (3,012) | (4,716) |
+--------------------------------+------+--------------+--------------------+--------------+
| Cash and cash equivalents at | | 3,751,962 | 2,614,484 | 2,614,484 |
| beginning of period | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| Cash and cash equivalents at | 4 | 4,721,316 | 3,580,862 | 3,751,962 |
| end of period | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
| | | | | |
+--------------------------------+------+--------------+--------------------+--------------+
Notes to the condensed interim financial statements
(forming part of the condensed financial statements)
1 Accounting policies and basis of preparation
Islamic Bank of Britain PLC ('the Company') is a company incorporated in the UK.
The annual financial statements of the Company are prepared in accordance with
IFRSs as adopted by the EU. The interim financial information included in this
half-yearly report has been prepared in accordance with the disclosure
requirements of AIM Rules and the recognition and measurement requirements of
IFRSs as adopted by the EU excluding IAS34 'Interim Financial Reporting',
applying the accounting policies and presentation that were applied in the
preparation of the Company's published financial statements for the year ended
31 December 2009. The directors anticipate that these accounting policies will
be used in the preparation of the Company's annual financial statements for the
year ending 31 December 2010.
The interim financial statements are condensed and do not include all of the
information required for full annual financial statements. The information in
this interim report is unaudited.
Going Concern
The interim financial statements of the Company have been prepared on the going
concern basis. In making the going concern assessment, the directors have
prepared detailed financial forecasts of the Company, including its funding and
capital position, for the twelve months from the date of approval of these
interim financial statements.
Based on these forecasts, the directors are confident that the Company has
adequate resources to continue in operational existence and will continue to
comply with all relevant regulatory requirements for the foreseeable future.
Accordingly, they continue to adopt the going concern basis in preparing the
interim financial statements.
2 Earnings per ordinary share
Basic and diluted earnings per ordinary share are calculated by dividing the
loss for the financial period attributable to equity shareholders by the
weighted average number of ordinary shares in issue in the 6 month period ended
30 June 2010 of 546,4700,000 (6 month period ended 30 June 2009: 530,272,155,
Year ended 31 December 2009: 538,437,644).
The Company has established an HMRC approved Company Share Option Plan ('CSOP')
under which options to subscribe for the Company's ordinary shares of 1p each
have been awarded to certain employees. At 30 June 2010 1,323,143 options remain
outstanding (30 June 2009: 1,481,037, 31 December 2009: 1,481,033). Diluted loss
per share is the same as basic loss per share since the outstanding share
options have not been taken into account due to their anti-dilutive effect. This
arises since the Company is currently loss making.
3Income tax expense
There were no taxable profits or recoverable losses for the 6 month period ended
30 June 2010 (6 month period ended 30 June 2009: GBPnil, Year ended 31 December
2009: GBPnil) and accordingly the Company has not provided for a tax charge or a
tax debtor.
As at 30 June 2010, the Company had potential deferred tax assets in respect of
tax losses carried forward of GBP11,112,920 (30 June 2009: GBP8,734,271, 31
December 2009: GBP10,000,664) and in respect of timing differences on capital
allowances of GBP1,702,149 (30 June 2009: GBP1,518,551, 31 December 2009:
GBP1,627,667).
In respect of the recognition of deferred tax assets, for the purposes of
applying the requirements of IAS 12 ('Income Taxes'), it has been considered
that the Company is not currently at a sufficiently advanced stage in its
development to confidently assert future offsetting tax liabilities. Capital
allowances to be claimed are being finalised and therefore the level of the
potential asset shown above may change.
4 Cash and cash equivalents
+-----------------------------------------+-----------+-----------------+-----------+
| | 30 Jun | 30 Jun | 31 Dec |
| | 2010 | 2009 | 2009 |
+-----------------------------------------+-----------+-----------------+-----------+
| | GBP | GBP | GBP |
+-----------------------------------------+-----------+-----------------+-----------+
| | | | |
+-----------------------------------------+-----------+-----------------+-----------+
| Cash | 867,788 | 460,974 | 577,273 |
+-----------------------------------------+-----------+-----------------+-----------+
| Other advances to banks | 3,853,528 | 3,119,888 | 3,174,689 |
+-----------------------------------------+-----------+-----------------+-----------+
| | | | |
+-----------------------------------------+-----------+-----------------+-----------+
| Total cash and cash equivalents | 4,721,316 | 3,580,862 | 3,751,962 |
+-----------------------------------------+-----------+-----------------+-----------+
5 Impairment allowance
+-----------------------------------------+-------------------+-----------+-----------+
| | 6 month | 6 month | |
| | period | period | Year |
| | ended | ended | ended |
| | 30 Jun | 30 Jun | 31 Dec |
| | 2010 | 2009 | 2009 |
+-----------------------------------------+-------------------+-----------+-----------+
| | GBP | GBP | GBP |
+-----------------------------------------+-------------------+-----------+-----------+
| Specific allowances for impairment | | | |
+-----------------------------------------+-------------------+-----------+-----------+
| Balance at beginning of period | 18,481 | 145,707 | 145,707 |
+-----------------------------------------+-------------------+-----------+-----------+
| Charge for the period | 7,916 | - | - |
+-----------------------------------------+-------------------+-----------+-----------+
| Amounts written off during the period | - | (105,734) | (127,226) |
+-----------------------------------------+-------------------+-----------+-----------+
| Balance at end of period | 26,397 | 39,973 | 18,481 |
+-----------------------------------------+-------------------+-----------+-----------+
| | | | |
+-----------------------------------------+-------------------+-----------+-----------+
| Collective allowances for impairment | | | |
+-----------------------------------------+-------------------+-----------+-----------+
| Balance at beginning of period | 793,339 | 939,908 | 939,908 |
+-----------------------------------------+-------------------+-----------+-----------+
| Charge for the period | 94,377 | 200,637 | 408,939 |
+-----------------------------------------+-------------------+-----------+-----------+
| Amounts written off during the period | (75,275) | (476,046) | (555,508) |
+-----------------------------------------+-------------------+-----------+-----------+
| Balance at end of period | 812,441 | 664,499 | 793,339 |
+-----------------------------------------+-------------------+-----------+-----------+
| | | | |
+-----------------------------------------+-------------------+-----------+-----------+
| Total allowances for impairment | | | |
+-----------------------------------------+-------------------+-----------+-----------+
| Balance at beginning of period | 811,820 | 1,085,615 | 1,085,615 |
+-----------------------------------------+-------------------+-----------+-----------+
| Charge for the period | 102,293 | 200,637 | 408,939 |
+-----------------------------------------+-------------------+-----------+-----------+
| Amounts written off during the period | (75,275) | (581,780) | (682,734) |
+-----------------------------------------+-------------------+-----------+-----------+
| Balance at end of period | 838,838 | 704,472 | 811,820 |
+-----------------------------------------+-------------------+-----------+-----------+
| | | | |
+-----------------------------------------+-------------------+-----------+-----------+
This impairment allowance relates to consumer finance accounts and other
advances to customers.
6 Deposits from banks
+-----------------------------------------+----------------------+---------------+-------------------+
| | 30 | 30 Jun | 31 Dec |
| | Jun | 2009 | 2009 |
| | 2010 | | |
+-----------------------------------------+----------------------+---------------+-------------------+
| | GBP | GBP | GBP |
+-----------------------------------------+----------------------+---------------+-------------------+
| | | | |
+-----------------------------------------+----------------------+---------------+-------------------+
| Repayable on demand | 41,540 | 319,637 | 78,652 |
+-----------------------------------------+----------------------+---------------+-------------------+
| 3 months or less but not repayable on | 572,848 | 655,897 | 530,640 |
| demand | | | |
+-----------------------------------------+----------------------+---------------+-------------------+
| | | | |
+-----------------------------------------+----------------------+---------------+-------------------+
| Total deposits from banks | 614,388 | 975,534 | 609,292 |
+-----------------------------------------+----------------------+---------------+-------------------+
| | | | |
+-----------------------------------------+----------------------+---------------+-------------------+
| Comprising: | | | |
+-----------------------------------------+----------------------+---------------+-------------------+
| Non profit sharing | 41,540 | 319,637 | 78,652 |
+-----------------------------------------+----------------------+---------------+-------------------+
| Profit sharing/paying accounts | 572,848 | 655,897 | 530,640 |
+-----------------------------------------+----------------------+---------------+-------------------+
| | | | |
+-----------------------------------------+----------------------+---------------+-------------------+
| Total deposits from banks | 614,388 | 975,534 | 609,292 |
+-----------------------------------------+----------------------+---------------+-------------------+
7 Deposits from customers
+-----------------------------------------+-------------+-----------------+-------------+
| | 30 Jun | 30 Jun | 31 Dec |
| | 2010 | 2009 | 2009 |
+-----------------------------------------+-------------+-----------------+-------------+
| | GBP | GBP | GBP |
+-----------------------------------------+-------------+-----------------+-------------+
| | | | |
+-----------------------------------------+-------------+-----------------+-------------+
| Repayable on demand | 112,693,848 | 102,867,109 | 104,437,151 |
+-----------------------------------------+-------------+-----------------+-------------+
| 3 months or less but not repayable on | 46,188,603 | 47,651,745 | 46,993,655 |
| demand | | | |
+-----------------------------------------+-------------+-----------------+-------------+
| 1 year or less but over 3 months | 19,316,947 | 20,836,534 | 18,664,345 |
+-----------------------------------------+-------------+-----------------+-------------+
| 2 years or less but over 1 year | 14,143,516 | - | 15,880,841 |
+-----------------------------------------+-------------+-----------------+-------------+
| | | | |
+-----------------------------------------+-------------+-----------------+-------------+
| Total deposits from customers | 192,342,914 | 171,355,388 | 185,975,992 |
+-----------------------------------------+-------------+-----------------+-------------+
| | | | |
+-----------------------------------------+-------------+-----------------+-------------+
| Comprising: | | | |
+-----------------------------------------+-------------+-----------------+-------------+
| Non profit sharing | 36,871,779 | 32,413,000 | 34,215,366 |
+-----------------------------------------+-------------+-----------------+-------------+
| Profit sharing/paying accounts | 155,471,135 | 138,942,388 | 151,760,626 |
+-----------------------------------------+-------------+-----------------+-------------+
| | | | |
+-----------------------------------------+-------------+-----------------+-------------+
| Total deposits from customers | 192,342,914 | 171,355,388 | 185,975,992 |
+-----------------------------------------+-------------+-----------------+-------------+
8 Called up share capital
+-----------------------------------------+-----------+-------------+-----------+
| | 30 Jun | 30 Jun | 31 Dec |
| | 2010 | 2009 | 2009 |
+-----------------------------------------+-----------+-------------+-----------+
| | GBP | GBP | GBP |
+-----------------------------------------+-----------+-------------+-----------+
| Authorised: | | | |
+-----------------------------------------+-----------+-------------+-----------+
| Equity: 725,000,000 ordinary shares of | 7,250,000 | 7,250,000 | 7,250,000 |
| GBP0.01 each | | | |
+-----------------------------------------+-----------+-------------+-----------+
| | | | |
+-----------------------------------------+-----------+-------------+-----------+
| Allotted, called up and fully paid: | | | |
+-----------------------------------------+-----------+-------------+-----------+
| Issued ordinary share capital | 5,464,700 | 5,464,700 | 5,464,700 |
+-----------------------------------------+-----------+-------------+-----------+
9 Related party disclosures
At 30 June 2010, directors of the Company and their immediate relatives
controlled 0.03% of the voting shares of the Company (30 June 2009: 0.03%, 31
December 2009: 0.03%).
Transactions with key management personnel
Key management of the Company are the Board of Directors and Management
Committee members. The compensation of key management personnel, including the
directors, is as follows:
+----------------------------------+--+----+---------+---------+-----------+
| | | | 6 | 6 | |
| | | | month | month | Year |
| | | | period | period | ended |
| | | | ended | ended | 31 Dec |
| | | | 30 Jun | 30 Jun | 2009 |
| | | | 2010 | 2009 | |
+----------------------------------+--+----+---------+---------+-----------+
| | | | GBP | GBP | GBP |
+----------------------------------+--+----+---------+---------+-----------+
| | | | | | |
+----------------------------------+--+----+---------+---------+-----------+
| Key management emoluments | | | 673,233 | 735,161 | 1,568,407 |
| including social security costs | | | | | |
+----------------------------------+--+----+---------+---------+-----------+
| Company contributions to pension | | | 33,866 | 27,722 | 58,684 |
| plans | | | | | |
+----------------------------------+--+----+---------+---------+-----------+
| | | | | | |
+----------------------------------+--+----+---------+---------+-----------+
| Total | | | 707,099 | 762,883 | 1,627,091 |
+----------------------------------+--+----+---------+---------+-----------+
Deposit balances, operated under standard customer terms and conditions, held by
key management personnel, including directors, totalled GBP180,273 as at 30 June
2010 (30 June 2009: GBP399,571, 31 December 2009: GBP303,194). The highest
balance during the 6 month period ended 30 June 2010 was GBP407,219 (6 month
period ended 30 June 2009: GBP458,601, Year ended 31 December 2009: GBP441,718).
Total returns paid on these accounts for the 6 month period ended 30 June 2010
totalled GBP944 (6 month period ended 30 June 2009: GBP1,221, Year ended 31
December 2009: GBP2,355).
Outstanding consumer finance and home purchase plan account balances relating to
key management personnel, including directors, totalled GBP192,477 as at 30 June
2010 (30 June 2009: GBP225,195, 31 December 2009: GBP209,753). Returns
recognised and rent received on these accounts for the 6 month period ended 30
June 2010 totalled GBP4,224 (6 month period ended 30 June 2009: GBP2,816, Year
ended 31 December 2009: GBP7,544). All consumer finance and home purchase plan
facilities taken by key management personnel and directors were offered in line
with standard customer terms and conditions.
10 Interim Report and statutory accounts
The comparative figures for the financial year ended 31 December 2009 are not
the company's statutory accounts for that financial year. Those accounts have
been reported on by the company's auditors and delivered to the registrar of
companies. The report of the auditors was (i) unqualified, (ii) did not include
a reference to any matters to which the auditors drew attention by way of
emphasis without qualifying their report, and (iii) did not contain a statement
under section 498 of the Companies Act 2006.
11 Segmental reporting
The Company measures and reports on the financial performance of the business to
the chief operating decision maker as a whole and so has only one operating
segment. All business is conducted from the United Kingdom.
A split of the Company's revenue by the geographic location in which the revenue
was generated is provided below:
+-----------------------------------------+-----------+-----------+-----------+
| | 6 month | 6 month | |
| | period | period | Year |
| | ended | ended | ended |
| | 30 Jun | 30 Jun | 31 Dec |
| | 2010 | 2009 | 2009 |
+-----------------------------------------+-----------+-----------+-----------+
| | GBP | GBP | GBP |
+-----------------------------------------+-----------+-----------+-----------+
| | | | |
+-----------------------------------------+-----------+-----------+-----------+
| United Kingdom | 1,259,199 | 918,535 | 1,923,190 |
+-----------------------------------------+-----------+-----------+-----------+
| Europe | 82,947 | 226,826 | 232,800 |
+-----------------------------------------+-----------+-----------+-----------+
| Middle East | 191,914 | 547,053 | 861,022 |
+-----------------------------------------+-----------+-----------+-----------+
| Total | 1,534,060 | 1,692,414 | 3,017,012 |
+-----------------------------------------+-----------+-----------+-----------+
| | | | |
+-----------------------------------------+-----------+-----------+-----------+
The Company does not have any non-current assets located outside the United
Kingdom and no single external customer accounts for more than 10% of total
income.
12 Post balance sheet events
Issue of new share capital
On 17 August 2010, an ordinary resolution was passed at a general meeting
increasing the authorised share capital of the Company from GBP7,250,000 to
GBP28,488,233 by the creation of an additional 2,123,823,300 new Ordinary
Shares. On 17 August 2010, an additional 2,000,000,000 shares were allotted for
consideration of GBP20,000,000 before expenses. Expenses of GBP2,509,266 were
incurred in the placing resulting in an increase to equity of GBP17,490,734.
Change in UK corporation tax rates
The Emergency Budget on 22 June 2010 announced that the UK corporation tax rate
will reduce from 28% to 24% over a period of 4 years from 2011. The first
reduction in the UK corporation tax rate from 28% to 27% was substantively
enacted on 20 July 2010 and will be effective from 1 April 2011. If the rate
change from 28% to 27% had been substantively enacted on or before the balance
sheet date it would have the effect of reducing the potential deferred tax
assets at that date by GBP457,681. It has not yet been possible to quantify the
full anticipated effect of the announced further 3% rate reduction, although
this will further reduce the company's future current tax charge and reduce the
company's potential deferred tax assets accordingly.
- END -
This information is provided by RNS
The company news service from the London Stock Exchange
END
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