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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Aero Inventory | LSE:AI. | London | Ordinary Share | GB0004440847 | ORD 1.25P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 264.00 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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TIDMAI.
RNS Number : 8887O
Aero Inventory PLC
16 March 2009
The headline for the Aero Inventory PLC announcement released today at
07:00 under RNS No 8773O should read Interim Results
The announcement text is unchanged and is reproduced in full below.
For Immediate Release
16 March 2009
AERO INVENTORY PLC
RESULTS ANNOUNCEMENT AND INTERIM
MANAGEMENT REPORT FOR THE HALF
YEAR ENDED 31 DECEMBER 2008
Aero Inventory plc ("Aero Inventory", or the "Company" or "Group"), the provider
of e-based procurement and inventory management solutions to the aerospace
industry, today announces its results for the six months ended 31 December 2008.
HIGHLIGHTS OF THE SIX MONTHS
* Revenue of US$256.1 million, an increase of 55% over the corresponding period
(2007: US$165.1 million), reflecting in particular a full six-month contribution
from our contract with Aveos (formerly ACTS).
* Pre-tax profits of US$33.1 million, an increase of 46% over the corresponding
period (2007: US$22.7 million).
* Fully diluted EPS of 46.9 cents per share, an increase of 47% over the
corresponding period (2007: 31.9 cents per share). Translated into sterling at
the current exchange rate the diluted earnings per share amounted to
approximately 34 pence per share.
* Interim dividend maintained at last year's level of 6.0 pence per share.
* Decision taken to withdraw from contract negotiations with the major airline
referred to in our 10th February announcement as satisfactory commercial terms
could not be agreed.
* In the absence of this major piece of new business, the Board has determined to
focus in the near term on cash generation and improved operational efficiency.
CHAIRMAN'S STATEMENT
STRATEGY
Aero Inventory's long-term strategy is to continue to grow the business rapidly
and profitably by securing long-term sole supplier contracts with airlines and
maintenance, repair and overhaul companies (MROs). The market is large, and the
trend towards outsourcing strong. The potential for further growth is therefore
significant.
However, following the termination of contract negotiations with a major
airline, the Board has decided that in the near term the Company's focus will be
on cash generation and improved operational efficiency. Substantial new
contracts have long gestation periods. While we may add some smaller pieces of
business which complement our existing contracts we intend to view this period,
at a time when investors are wary of gearing and focused upon cash, as an
opportunity to demonstrate the ability of the business to generate cash and
increase its stock efficiency, having already proven its ability over a number
of years to achieve rapid growth in sales and profits.
RESULTS AND DIVIDEND
The results for the first half were in line with management expectations,
reflecting in particular a full six-month contribution from our contract with
Aveos (formerly ACTS) in Canada. Turnover was up 55% and pre-tax profits were up
by 46%. In the light of this result and given the satisfactory outlook for
profits the Board is recommending an unchanged interim dividend of 6.0 pence per
share. The interim dividend will be paid on 19 June 2009 to shareholders on the
share register on 22 May 2009.
Nigel McCorkell
Chairman
16 March 2009
CONTACTS
Aero Inventory plc +44 (0)20 8688 5812
Rupert
Lewin, Chief Executive rupert.lewin@aero-inventory.com
JPMorgan Cazenove +44 (0) 20 7588 2828
Nicholas
Garrett nick.garrett@jpmorgancazenove.com
Numis Securities +44 (0) 20 7588 2828
Chris
Wilkinson c.wilkinson@numiscorp.com
Buchanan Communications Limited +44 (0)20 7466 5000
Bobby Morse bobbym@buchanan.uk.com
Christian Goodbody christiang@buchanan.uk.com
CHIEF EXECUTIVE'S STATEMENT
REVIEW OF RESULTS
The first half of the current financial year included a full six months
contribution from our contract with Aveos (formerly ACTS) and, largely
reflecting this, our revenues have grown by 55% to $256.1 million and profits
before tax by 46% to $33.1 million.
Gross margins in the period amounted to 34% compared to 36.8% in the comparative
period and the operating margin remained at approximately 18% as operating
expenses only increased 31% compared to the 55% increase in revenue.
Finance costs increased to US$14.9 million (2007: US$8.1 million). The increase
reflects the increased level in borrowings to finance the Aveos and ANA
contracts and some additional investment in stock to support other existing
contracts.
The pre-tax profit for the six months was US$33.1 million (2007: US$22.7
million). The tax charge was US$10.4 million (2007: US$6.5 million), which
reflects an estimated effective annual rate of 31% compared to a tax rate of 29%
in the last financial year.
On the basis of after tax earnings of US$22.7 million (2007: US$16.2 million)
and the weighted average number of shares in issue during the period of
47,626,909 (2007: 47,360,921), basic earnings per share were 47.6 cents per
share (2007: 34.1 cents per share). Diluted earnings per share were 46.9 cents
per share (2007: 31.9 cents per share). Translated into sterling at the current
exchange rate the diluted earnings per share amounted to approximately 34 pence
per share.
The period-end balance sheet shows increased stocks at US$751.9 million
(compared to US$690.1 million at 30 June 2008). The increase from 30 June 2008
includes additional investment made in stock to support our ANA and Aveos
contracts but excludes the stocks sold in February to Air Canada. If this
transaction had been included the stock value would have been similar to that
reported at the end of last financial year.
Net bank debt at 31 December 2008 was US$467.1 million (compared to US$392.2
million at 30 June 2008). The movement since 30 June 2008 again principally
reflects stock investment to support our newer contracts. Since 31 December 2008
we have made progress in reducing stock levels with a sale of stock to Air
Canada referred to above. The Company has a committed US$500 million facility in
place which does not expire until February 2013.
OPERATIONAL IMPROVEMENTS
We continue to focus on all operational aspects of our business and recently a
series of changes has been made to our planning and purchasing activities to try
to ensure that inventory meets as closely as possible the requirements of our
customers. Total purchases in March 2009 are anticipated to amount to less than
US$20 million compared with over US$40 million one year earlier as contracts
mature and we start to reap the rewards of tighter planning and greater stock
fungibility. More stocks are being transferred between sites and the total value
of these transfers completed in the period amounted to over US$50 million.
SRT IRELAND
It was announced on 12 February 2009 that SR Technics plans to close its
operations in Dublin. Aero Inventory's business in Dublin accounted for less
than 5% of turnover in the six months to 31 December 2008 and therefore this
closure will not have a material effect of Aero Inventory's results particularly
as some of the work previously performed in Dublin is likely to be transferred
to Zurich or Stansted, where the Company continues to support SR Technics as
previously. The stock held in Dublin will be transferred to other sites. No
stock or debtor write-downs are anticipated.
Aero Inventory's two other contracts with SR Technics in Zurich and at Stansted
were due to be renewed in August 2009 but have now been extended by a further
three months to November 2009.
AIR CANADA
On 10 February 2009 Aero Inventory announced that it had completed the sale of a
significant quantity of consumable aircraft parts to Air Canada, the principal
customer of Aveos. The consideration received by Aero Inventory for this
material is in the form of Bills of Exchange with a face value of approximately
US$100 million, maturing in early February 2010. Aero Inventory had intended to
discount the bills for cash to raise part of the funds necessary to finance its
prospective substantial new contract. In light of the decision to terminate the
contract negotiations referred to earlier the Company is now considering whether
to hold some or all of the bills until maturity. This sale of material which
will largely not need to be restocked represents a significant step towards
achieving the Company's twin objectives of improving stock turn and releasing
cash from inventory. The stock sold represents in part materials that would have
been purchased by Air Canada from our customer Aveos and therefore the sale will
have the effect of reducing ongoing sales levels to Aveos in the short term.
SHARE PLACING
At the same time as the sale of stocks to Air Canada the company announced that
it had raised GBP11.9 million before expenses, through an institutional placing
of 4,762,680 new shares at a price of 250p per share.
CURRENT TRADING AND PROSPECTS
Against the background of a strong first half, it is disappointing to announce
that the Board has decided to withdraw from negotiations for a substantial new
contract (referred to in our 10 February announcement) as satisfactory
commercial terms could not be agreed. Given the long gestation periods of
substantial new contracts, the near term focus for the business has now turned
to cash generation and improved operational efficiency. Our existing business
continues to trade broadly in line with management expectations, although, as we
have said on previous occasions, it would be unrealistic to expect it to be
unaffected by the deterioration in the global aviation market. While some
additional costs have been put in place in preparation for the major new
contract, the outcome for the year is still anticipated to be satisfactory.
Rupert Lewin
Chief Executive
16 March 2009
CONSOLIDATED INCOME STATEMENT
For The HALF Year Ended 31 DECEMBER 2008
+--------------------------------+----------+--------------+---------------+------------+
| | | | | |
+--------------------------------+----------+--------------+---------------+------------+
| | | | |
+--------------------------------+----------+------------------------------+------------+
| | | 6 months ended | Year ended |
| | | 31 December | 30 June |
+--------------------------------+----------+------------------------------+------------+
| | | 2008 | 2007 | 2008 |
+--------------------------------+----------+--------------+---------------+------------+
| | Notes | $'millions | $'millions | $'millions |
+--------------------------------+----------+--------------+---------------+------------+
| | | | Restated* | Restated* |
+--------------------------------+----------+--------------+---------------+------------+
| | | | | |
+--------------------------------+----------+--------------+---------------+------------+
| Revenue | 4 | 256.1 | 165.1 | 440.0 |
+--------------------------------+----------+--------------+---------------+------------+
| Cost of sales | | (168.7) | (104.3) | (270.1) |
+--------------------------------+----------+--------------+---------------+------------+
| Net operating expenses | | (39.4) | (30.0) | (76.6) |
+--------------------------------+----------+--------------+---------------+------------+
| | | | | --------- |
| | | --------- | --------- | |
+--------------------------------+----------+--------------+---------------+------------+
| Operating profit | | 48.0 | 30.8 | 93.3 |
+--------------------------------+----------+--------------+---------------+------------+
| Finance costs | | (14.9) | (8.1) | (20.2) |
+--------------------------------+----------+--------------+---------------+------------+
| | | | ---------- | --------- |
| | | --------- | | |
+--------------------------------+----------+--------------+---------------+------------+
| Profit before tax | | 33.1 | 22.7 | 73.1 |
+--------------------------------+----------+--------------+---------------+------------+
| Tax | 5 | (10.4) | (6.5) | (21.5) |
+--------------------------------+----------+--------------+---------------+------------+
| | | | ---------- | --------- |
| | | --------- | | |
+--------------------------------+----------+--------------+---------------+------------+
| Profit for the year | | 22.7 | 16.2 | 51.6 |
+--------------------------------+----------+--------------+---------------+------------+
| | | --------- | ---------- | --------- |
+--------------------------------+----------+--------------+---------------+------------+
| | | | | |
+--------------------------------+----------+--------------+---------------+------------+
| Earnings per share (expressed | | | | |
| in cents per share) | | | | |
+--------------------------------+----------+--------------+---------------+------------+
| | | | | |
+--------------------------------+----------+--------------+---------------+------------+
| Basic | 7 | 47.6c | 34.1c | 108.7c |
+--------------------------------+----------+--------------+---------------+------------+
| Diluted | 7 | 46.9c | 31.9c | 102.0c |
+--------------------------------+----------+--------------+---------------+------------+
| | | ----------- | ----------- | ---------- |
+--------------------------------+----------+--------------+---------------+------------+
| | | | | |
+--------------------------------+----------+--------------+---------------+------------+
All amounts are derived from continuing operations.
* For the six months to 31 December 2007 $1.7 million of carriage was
reclassified from net operating expenses to cost of sales. For the year to 30
June 2008 $8.1 million of carriage was reclassified from net operating expenses
to cost of product sales
CONSOLIDATED STATEMENT OF
RECOGNISED INCOME AND EXPENSE
For The HALF Year Ended 31 DECEMBER 2008
+--------------------------------------------------+--------+-------+-----------------------+---------------+---------------+
| | | | | Year |
| | | | 6 months ended | ended |
| | | | 31December | 30 June |
| | | | 2008 2007 | 2008 |
+--------------------------------------------------+--------+-------+---------------------------------------+---------------+
| | Notes | | | | $'millions |
| | | | $'millions | $'millions | |
+--------------------------------------------------+--------+-------+-----------------------+---------------+---------------+
| | | | | | |
+--------------------------------------------------+--------+-------+-----------------------+---------------+---------------+
| | | | | - | 1.4 |
| | | | (1.1) | | |
| Taxation on share based payments | | | | | |
+--------------------------------------------------+--------+-------+-----------------------+---------------+---------------+
| Effect of translation of foreign operations | | | 3.3 | - | |
| | | | | | - |
| | | | _____________ | _____________ | |
| | | | | | _____________ |
+--------------------------------------------------+--------+-------+-----------------------+---------------+---------------+
| Net income recognised directly in equity | 10 | | 2.2 | | 1.4 |
| | | | | - | |
+--------------------------------------------------+--------+-------+-----------------------+---------------+---------------+
| Profit for the period | 22.7 | 16.2 | 51.6 |
+-------------------------------------------------------------------+-----------------------+---------------+---------------+
| | | | _____________ | _____________ | _____________ |
+--------------------------------------------------+--------+-------+-----------------------+---------------+---------------+
| Total recognised income for the year | | | 24.9 | 16.2 | 53.0 |
+--------------------------------------------------+--------+-------+-----------------------+---------------+---------------+
| | | | --------- | --------- | --------- |
+--------------------------------------------------+--------+-------+-----------------------+---------------+---------------+
CONSOLIDATED Balance Sheet
FOR THE HALF year ended 31 DECEMBER 2008
+-------------+----------+------------+--------------+------------+
| | | | | |
+-------------+----------+------------+--------------+------------+
| | | | | |
+-------------+----------+------------+--------------+------------+
| | | 6 months ended | Year |
| | | 31 | ended 30 |
| | | December | June |
+-------------+----------+---------------------------+------------+
| | | 2008 | 2007 | 2008 |
+-------------+----------+------------+--------------+------------+
| | Notes | $'millions | $'millions | $'millions |
+-------------+----------+------------+--------------+------------+
| | | | | |
+-------------+----------+------------+--------------+------------+
| Non-current | | | | |
| assets | | | | |
+-------------+----------+------------+--------------+------------+
| Intangible | | 48.1 | 56.9 | 52.8 |
| assets | | | | |
+-------------+----------+------------+--------------+------------+
| Property, | | 4.0 | 3.8 | 3.9 |
| plant and | | | | |
| equipment | | | | |
+-------------+----------+------------+--------------+------------+
| | | --------- | --------- | ------- |
+-------------+----------+------------+--------------+------------+
| | | 52.1 | 60.7 | 56.7 |
+-------------+----------+------------+--------------+------------+
| | | --------- | --------- | ------- |
+-------------+----------+------------+--------------+------------+
| Current | | | | |
| assets | | | | |
+-------------+----------+------------+--------------+------------+
| Inventories | | 751.9 | 569.4 | 690.1 |
+-------------+----------+------------+--------------+------------+
| Trade and | | 129.5 | 64.2 | 96.8 |
| other | | | | |
| receivables | | | | |
+-------------+----------+------------+--------------+------------+
| Deferred | | 1.6 | 0.5 | 2.8 |
| taxation | | | | |
+-------------+----------+------------+--------------+------------+
| Cash and | 8 | 0.9 | 0.4 | 1.2 |
| cash | | | | |
| equivalents | | | | |
+-------------+----------+------------+--------------+------------+
| | | --------- | --------- | ------- |
+-------------+----------+------------+--------------+------------+
| | | 883.9 | 634.5 | 790.9 |
+-------------+----------+------------+--------------+------------+
| | | --------- | --------- | ------- |
+-------------+----------+------------+--------------+------------+
| Total | | 936.0 | 695.2 | 847.6 |
| assets | | | | |
+-------------+----------+------------+--------------+------------+
| | | --------- | --------- | ------- |
+-------------+----------+------------+--------------+------------+
| Current | | | | |
| liabilities | | | | |
+-------------+----------+------------+--------------+------------+
| Trade and | | 128.9 | 106.3 | 141.9 |
| other | | | | |
| payables | | | | |
+-------------+----------+------------+--------------+------------+
| Corporation | | 28.9 | 23.1 | 19.3 |
| tax payable | | | | |
+-------------+----------+------------+--------------+------------+
| | | --------- | --------- | ------- |
+-------------+----------+------------+--------------+------------+
| | | 157.8 | 129.4 | 161.2 |
+-------------+----------+------------+--------------+------------+
| | | --------- | --------- | ------- |
+-------------+----------+------------+--------------+------------+
| | | | | |
+-------------+----------+------------+--------------+------------+
| Non - | | | | |
| current | | | | |
| liabilities | | | | |
+-------------+----------+------------+--------------+------------+
| Borrowings | 8 | 467.1 | 304.7 | 392.2 |
+-------------+----------+------------+--------------+------------+
| | | --------- | --------- | ------- |
+-------------+----------+------------+--------------+------------+
| Total | | 624.9 | 434.1 | 553.4 |
| liabilities | | | | |
+-------------+----------+------------+--------------+------------+
| | | --------- | --------- | ------- |
+-------------+----------+------------+--------------+------------+
| Net assets | | 311.1 | 261.1 | 294.2 |
+-------------+----------+------------+--------------+------------+
| | | --------- | --------- | ------- |
+-------------+----------+------------+--------------+------------+
| | | | | |
+-------------+----------+------------+--------------+------------+
| Equity | | | | |
+-------------+----------+------------+--------------+------------+
| Share | 10 | 1.0 | 1.0 | 1.0 |
| capital | | | | |
+-------------+----------+------------+--------------+------------+
| Share | 10 | 212.1 | 211.1 | 212.1 |
| premium | | | | |
| account | | | | |
+-------------+----------+------------+--------------+------------+
| Share based | 10 | 4.0 | 2.8 | 3.3 |
| payment | | | | |
| reserve | | | | |
+-------------+----------+------------+--------------+------------+
| Retained | 10 | 94.0 | 46.2 | 77.8 |
| earnings | | | | |
+-------------+----------+------------+--------------+------------+
| | | --------- | --------- | ------- |
+-------------+----------+------------+--------------+------------+
| Total | 10 | 311.1 | 261.1 | 294.2 |
| equity | | | | |
+-------------+----------+------------+--------------+------------+
| | | --------- | --------- | ------- |
+-------------+----------+------------+--------------+------------+
| | | | | |
+-------------+----------+------------+--------------+------------+
The accounts were approved by the board on 16 March 2009.
By order of the Board
Rupert Lewin Hugh Bevan
Chief Executive
Finance Director
16 March 2009 16 March
2009
consolidated cash flow statement
FOR THE HALF YEAR ENDED 31 DECEMBER 2008
+---------------------+----------------+-----------------+------------------+---------------+
| | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| | | 6 months ended | Year ended 30 |
| | | 31 December | June |
+---------------------+----------------+------------------------------------+---------------+
| | | 2008 | 2007 | 2008 |
+---------------------+----------------+-----------------+------------------+---------------+
| | Notes | $'millions | $'millions | $'millions |
+---------------------+----------------+-----------------+------------------+---------------+
| Operating | | | | |
| activities | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| Profit for the | | 22.7 | 16.2 | 51.6 |
| period | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| Adjustments to | | | | |
| reconcile profit | | | | |
| for the period | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| to net cash inflow | | | | |
| from operating | | | | |
| activities: | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| Net finance costs | | 14.9 | 8.1 | 18.3 |
+---------------------+----------------+-----------------+------------------+---------------+
| Income tax expense | | 10.4 | 6.5 | 21.5 |
+---------------------+----------------+-----------------+------------------+---------------+
| Depreciation of | | 0.7 | 0.6 | 1.9 |
| property, plant and | | | | |
| equipment | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| Amortisation of | | 6.2 | 4.8 | 10.2 |
| intangible assets | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| Net foreign | | 0.9 | - | - |
| exchange movement | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| Cost of share based | 9 | 0.7 | 0.6 | 1.3 |
| payments | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| Increase in | | (61.8) | (179.1) | (300.5) |
| inventories | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| Increase in trade | | (31.2) | (11.3) | (45.5) |
| and other | | | | |
| receivables | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| (Decrease)/increase | | (13.0) | 10.0 | 36.5 |
| in trade and other | | | | |
| payables | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| Increase in | | - | 0.6 | 1.3 |
| provisions | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| | | ----------- | ----------- | ----------- |
+---------------------+----------------+-----------------+------------------+---------------+
| Cash absorbed by | | (49.5) | (143.0) | (203.4) |
| operations | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| Income taxes paid | | (0.7) | (3.1) | (20.0) |
+---------------------+----------------+-----------------+------------------+---------------+
| | | ----------- | ----------- | ----------- |
+---------------------+----------------+-----------------+------------------+---------------+
| Net cash out flows | | (50.2) | (146.1) | (223.4) |
| from operating | | | | |
| activities | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| | | ----------- | ----------- | ----------- |
+---------------------+----------------+-----------------+------------------+---------------+
| Investing | | | | |
| activities | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| Purchase of | | (1.0) | (1.3) | (3.3) |
| property, plant and | | | | |
| equipment | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| Purchase of | | (1.5) | (25.1) | (25.8) |
| intangible assets | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| | | ----------- | ----------- | ----------- |
+---------------------+----------------+-----------------+------------------+---------------+
| Net Cash flows used | | (2.5) | (26.4) | (29.1) |
| in investing | | | | |
| activities | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| | | ----------- | ----------- | ----------- |
+---------------------+----------------+-----------------+------------------+---------------+
| Financing | | | | |
| activities | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| Net interest paid | | (13.9) | (8.2) | (14.0) |
+---------------------+----------------+-----------------+------------------+---------------+
| Proceeds on issue | | - | 0.8 | 1.8 |
| of ordinary share - | | | | |
| net of expenses | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| Dividends paid | | (8.7) | (10.5) | (15.7) |
+---------------------+----------------+-----------------+------------------+---------------+
| Repayment of | 8 | - | (113.3) | (111.0) |
| borrowings | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| New bank loans | 8 | 74.2 | 308.6 | 410.9 |
| raised | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| Loan costs | 8 | 0.8 | (4.9) | (18.7) |
+---------------------+----------------+-----------------+------------------+---------------+
| | | ----------- | ----------- | ----------- |
+---------------------+----------------+-----------------+------------------+---------------+
| Net cash flows from | | 52.4 | 172.5 | 253.3 |
| financing | | | | |
| activities | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| | | ----------- | ----------- | ----------- |
+---------------------+----------------+-----------------+------------------+---------------+
| Net | | (0.3) | 0.0 | 0.8 |
| increase/(decrease) | | | | |
| in cash and cash | | | | |
| equivalents | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| Cash and cash | 8 | 1.2 | 0.4 | 0.4 |
| equivalents at | | | | |
| beginning of year | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| | | ----------- | ----------- | ----------- |
+---------------------+----------------+-----------------+------------------+---------------+
| Cash and cash | | | | |
| equivalents | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
| at end of year | 8 | 0.9 | 0.4 | 1.2 |
+---------------------+----------------+-----------------+------------------+---------------+
| | | ----------- | ----------- | ----------- |
+---------------------+----------------+-----------------+------------------+---------------+
| | | | | |
+---------------------+----------------+-----------------+------------------+---------------+
notes to the results announcement
FOR THE HALF YEAR ENDED 31 DECEMBER 2008
1. accounting presentation and policies
The financial information for the half year ended 31 December 2008 does not
constitute statutory accounts as defined in section 435 of the Companies Act
2006. Statutory accounts for the years ended 30 June 2008 and 2007 have been
delivered to the Registrar of Companies. The auditors have reported on those
accounts; their reports were unqualified, did not draw attention to any matters
by way of an emphasis without qualifying their report and did not contain
statements under section 237(2) or (3) the Companies Act 1985.
This financial information is prepared in accordance with the measurement
criteria International Financial Reporting Standards ("IFRSs") as adopted for
use in the EU, as set out in the company's 2008 Annual Report, and in accordance
with the accounting policies the Group intends to use in preparing its next
annual financial statements.
In light of recent Financial Reporting Guidance we are making the following
enhanced going concern disclosures. As highlighted in note 6 to this financial
information, the Group has met its day to day working capital requirements, and
the anticipated requirements over a two to three year period, through an asset
based lending facility supplemented by equity issues where appropriate. This
facility, which is due for renewal in February 2013, may be drawn in advances,
which may be of 1, 3, 6, 9 or 12 months duration. The current economic
conditions create uncertainty particularly over the level of demand for the
Group's products. The Group's forecasts and projections, taking account of
reasonably likely contract revenues and stock sales, show that the Group is able
to operate within the level of its current facility. After making enquiries, the
directors have a reasonable expectation that the company and the Group have
adequate resources to continue in operational existence for the foreseeable
future. Accordingly, they continue to adopt the going concern basis in preparing
the financial information for the half year ended 31 December 2008.
2. PRINCIPAL RISKS AND UNCERTAINTIES
The principal risks and uncertainties affecting the Group are those described
under the headings below in the 'Review of Business' section of the Directors'
Report of the Annual Report 2008.
Operating risks
External risks
Financial risks
Credit risk
Cash flow
risk
Liquidity risk
Exchange rate risk
3. DIRECTORS' RESPONSIBILITY STATEMENT
The Board of Directors approved this document on 16 March 2009.
The directors confirm that to the best of their knowledge this unaudited
condensed financial information, which has been prepared in accordance with
IFRSs, gives a true and fair view of the assets, liabilities, financial position
and profit or loss of the issuer and the undertakings included in the
consolidation as a whole and that the interim management report includes a fair
review of the information herein.
The directors of Aero Inventory plc are as listed in the company's 2008 Annual
Report and have not changed since that date.
4. BUSINESS SEGMENTS
All revenue arose from the activity of procurement and inventory management for
the aerospace industry.
An analysis of revenue by type of sale is as follows:
+-------------------------+----------------+----------------+----------------+
| | | | |
+-------------------------+----------------+----------------+----------------+
| | 6 months ended | Year ended 30 |
| | 31 December | June |
+-------------------------+---------------------------------+----------------+
| | | | |
+-------------------------+----------------+----------------+----------------+
| | 2008 | 2007 | 2008 |
+-------------------------+----------------+----------------+----------------+
| | $'millions | $'millions | $'millions |
+-------------------------+----------------+----------------+----------------+
| | | | |
+-------------------------+----------------+----------------+----------------+
| Sales to contracted | | | |
| customers under | | | |
+-------------------------+----------------+----------------+----------------+
| long term supply | 253.6 | 161.3 | 434.3 |
| agreements | | | |
+-------------------------+----------------+----------------+----------------+
| Other sales | 2.5 | 3.8 | 5.7 |
+-------------------------+----------------+----------------+----------------+
| | ---- | ---- | ---- |
+-------------------------+----------------+----------------+----------------+
| | 256.1 | 165.1 | 440.0 |
+-------------------------+----------------+----------------+----------------+
| | ------- | ------- | ------- |
+-------------------------+----------------+----------------+----------------+
| | | | |
+-------------------------+----------------+----------------+----------------+
| Geographical analysis | | | |
| is presented below: | | | |
+-------------------------+----------------+----------------+----------------+
| | | | |
+-------------------------+----------------+----------------+----------------+
| Revenue | | | |
+-------------------------+----------------+----------------+----------------+
| UK, rest of Europe and | 33.7 | 41.6 | 78.1 |
| Middle East | | | |
+-------------------------+----------------+----------------+----------------+
| America | 93.2 | 24.6 | 143.4 |
+-------------------------+----------------+----------------+----------------+
| Asia Pacific | 129.2 | 98.9 | 218.5 |
+-------------------------+----------------+----------------+----------------+
| | | | |
+-------------------------+----------------+----------------+----------------+
| | ---- | ---- | ---- |
+-------------------------+----------------+----------------+----------------+
| | 256.1 | 165.1 | 440.0 |
+-------------------------+----------------+----------------+----------------+
| | ------- | ------- | ------- |
+-------------------------+----------------+----------------+----------------+
| | | | |
+-------------------------+----------------+----------------+----------------+
| | 6 months ended | Year ended 30 |
| | 31 December | June |
+-------------------------+---------------------------------+----------------+
| | 2008 | 2007 | 2008 |
+-------------------------+----------------+----------------+----------------+
| | $'millions | $'millions | $'millions |
+-------------------------+----------------+----------------+----------------+
| Assets | | | |
+-------------------------+----------------+----------------+----------------+
| UK, rest of Europe and | 208.3 | 178.5 | 258.6 |
| Middle East | | | |
+-------------------------+----------------+----------------+----------------+
| America | 245.4 | 172.5 | 231.4 |
+-------------------------+----------------+----------------+----------------+
| Asia Pacific | 482.3 | 349.1 | 357.6 |
+-------------------------+----------------+----------------+----------------+
| | ---- | ---- | ---- |
+-------------------------+----------------+----------------+----------------+
| | 936.0 | 700.1 | 847.6 |
+-------------------------+----------------+----------------+----------------+
| | ----- | ----- | ----- |
+-------------------------+----------------+----------------+----------------+
| | | | |
+-------------------------+----------------+----------------+----------------+
| | | | |
+-------------------------+----------------+----------------+----------------+
| | | | |
+-------------------------+----------------+----------------+----------------+
| Liabilities | | | |
+-------------------------+----------------+----------------+----------------+
| UK, rest of Europe and | 534.8 | 356.2 | 480.4 |
| Middle East | | | |
+-------------------------+----------------+----------------+----------------+
| America | 24.7 | 59.2 | 23.2 |
+-------------------------+----------------+----------------+----------------+
| Asia Pacific | 65.4 | 23.6 | 49.8 |
+-------------------------+----------------+----------------+----------------+
| | ---- | ---- | ---- |
+-------------------------+----------------+----------------+----------------+
| | 624.9 | 439.0 | 553.4 |
+-------------------------+----------------+----------------+----------------+
| | ------- | ------- | ------ |
+-------------------------+----------------+----------------+----------------+
5. TAXATION
(a) Tax on profit on ordinary activities
+--------------------------------+------------+----------------+----------------+
| | 6 months ended | Year ended 30 |
| | 31 December | June |
+--------------------------------+-----------------------------+----------------+
| | 2008 | 2007 | 2008 |
+--------------------------------+------------+----------------+----------------+
| | $'millions | $'millions | $'millions |
+--------------------------------+------------+----------------+----------------+
| Current year taxation: | | | |
+--------------------------------+------------+----------------+----------------+
| UK Corporation Tax | 10.3 | 6.9 | 22.8 |
+--------------------------------+------------+----------------+----------------+
| Adjustment in respect of prior | - | - | (0.2) |
| year | | | |
+--------------------------------+------------+----------------+----------------+
| Foreign taxation | - | - | 0.2 |
+--------------------------------+------------+----------------+----------------+
| | ---- | ---- | ---- |
+--------------------------------+------------+----------------+----------------+
| | 10.3 | 6.9 | 22.8 |
+--------------------------------+------------+----------------+----------------+
| | ----- | ----- | ----- |
+--------------------------------+------------+----------------+----------------+
| Deferred tax: | | | |
+--------------------------------+------------+----------------+----------------+
| Origination and reversal of | 0.1 | (0.4) | (1.3) |
| temporary differences | | | |
+--------------------------------+------------+----------------+----------------+
| | ---- | ---- | ---- |
+--------------------------------+------------+----------------+----------------+
| Total deferred tax | 0.1 | (0.4) | (1.3) |
+--------------------------------+------------+----------------+----------------+
| | ---- | ---- | ---- |
+--------------------------------+------------+----------------+----------------+
| Tax charge in the income | 10.4 | 6.5 | 21.5 |
| statement | | | |
+--------------------------------+------------+----------------+----------------+
| | ----- | ----- | ----- |
+--------------------------------+------------+----------------+----------------+
(b) Reconciliation of the total tax charge
The tax assessed for the year is lower than the standard rate of UK corporation
tax of 28% (2007: 30%). The differences are explained below:
+----------------------------------------------------+------------+----------------+----------------+
| | 6 months ended | Year ended 30 |
| | 31 December | June |
+----------------------------------------------------+-----------------------------+----------------+
| | | | |
+----------------------------------------------------+------------+----------------+----------------+
| | 2008 | 2007 | 2008 |
+----------------------------------------------------+------------+----------------+----------------+
| | $'millions | $'millions | $'millions |
+----------------------------------------------------+------------+----------------+----------------+
| | | | |
+----------------------------------------------------+------------+----------------+----------------+
| Profit before tax | 33.0 | 22.7 | 73.1 |
+----------------------------------------------------+------------+----------------+----------------+
| | ----- | ----- | ----- |
+----------------------------------------------------+------------+----------------+----------------+
| | | | |
+----------------------------------------------------+------------+----------------+----------------+
| Profit on ordinary items activities multiplied by | | | |
| standard | | | |
+----------------------------------------------------+------------+----------------+----------------+
| rate of Corporation Tax in the UK of 28% (2007: | 9.3 | 6.8 | 21.6 |
| 30%) | | | |
+----------------------------------------------------+------------+----------------+----------------+
| | | | |
+----------------------------------------------------+------------+----------------+----------------+
| Tax effects of: | | | |
+----------------------------------------------------+------------+----------------+----------------+
| Expenses not deductible for tax purposes | 0.1 | (0.3) | 0.1 |
+----------------------------------------------------+------------+----------------+----------------+
| Share based payments | 1.0 | - | (0.2) |
+----------------------------------------------------+------------+----------------+----------------+
| | ---- | ---- | ---- |
+----------------------------------------------------+------------+----------------+----------------+
| Total tax expense | 10.4 | 6.5 | 21.5 |
+----------------------------------------------------+------------+----------------+----------------+
| | ----- | ----- | ----- |
+----------------------------------------------------+------------+----------------+----------------+
The UK corporation tax rate decreased from 30% to 28% from 1 April 2008
resulting in an average standard rate of 29.5% for the year ending 30 June 2008.
6. DIVIDENDS
+-------------------------------------+--------------------------+--------------------------+
| | 6 months to 31 December |
+-------------------------------------+-----------------------------------------------------+
| | 2008 | 2007 |
+-------------------------------------+--------------------------+--------------------------+
| | $'millions | $'millions |
+-------------------------------------+--------------------------+--------------------------+
| Amounts recognised as distributions | | |
| to equity holders in the year: | | |
+-------------------------------------+--------------------------+--------------------------+
| Final dividend for the year ended | | |
| 30 June 2008 | | |
+-------------------------------------+--------------------------+--------------------------+
| of 12 pence per share, equivalent | | |
| to 18.36 cents per share | | |
+-------------------------------------+--------------------------+--------------------------+
| (2007: 10.5 pence, equivalent to | 8.7 | 10.1 |
| 20.3 cents per share) | | |
+-------------------------------------+--------------------------+--------------------------+
| | ---- | ---- |
+-------------------------------------+--------------------------+--------------------------+
| | 8.7 | 10.1 |
+-------------------------------------+--------------------------+--------------------------+
| | ----- | ----- |
+-------------------------------------+--------------------------+--------------------------+
The Board has recommended an interim dividend of 6.0 pence per share (
equivalent to 8.2 cents per share )
(2007: 6.0 pence, equivalent to 11.27 cents per share ).
7. EARNINGS PER SHARE
The calculation of the basic and diluted earnings per share is based on the
following data:
Earnings
+--------------------------------------------+--------------------------+--------------------------+
| | | |
+--------------------------------------------+--------------------------+--------------------------+
| | 6 months ended 31 December |
+--------------------------------------------+-----------------------------------------------------+
| | 2008 | 2007 |
+--------------------------------------------+--------------------------+--------------------------+
| | $'millions | $'millions |
+--------------------------------------------+--------------------------+--------------------------+
| | | |
+--------------------------------------------+--------------------------+--------------------------+
| Earnings for the purposes of basic and | 22.7 | 16.1 |
| diluted earnings per share | | |
+--------------------------------------------+--------------------------+--------------------------+
| | ----- | ----- |
+--------------------------------------------+--------------------------+--------------------------+
| | | |
+--------------------------------------------+--------------------------+--------------------------+
| Number of shares | | |
+--------------------------------------------+--------------------------+--------------------------+
| | 2008 | 2007 |
+--------------------------------------------+--------------------------+--------------------------+
| | Number | Number |
+--------------------------------------------+--------------------------+--------------------------+
| | | |
+--------------------------------------------+--------------------------+--------------------------+
| Weighted average number of ordinary shares | | |
| for the purposes | | |
+--------------------------------------------+--------------------------+--------------------------+
| of basic earnings per share | 47,626,909 | 47,360,921 |
+--------------------------------------------+--------------------------+--------------------------+
| | -------- | -------- |
+--------------------------------------------+--------------------------+--------------------------+
| | | |
+--------------------------------------------+--------------------------+--------------------------+
| Effect of dilutive potential ordinary | | |
| shares: | | |
+--------------------------------------------+--------------------------+--------------------------+
| Share options | 682,907 | 3,314,865 |
+--------------------------------------------+--------------------------+--------------------------+
| | -------- | -------- |
+--------------------------------------------+--------------------------+--------------------------+
| Weighted average number of ordinary shares | | |
| for the purposes | | |
+--------------------------------------------+--------------------------+--------------------------+
| of diluted earnings per share | 48,309,817 | 50,675,786 |
+--------------------------------------------+--------------------------+--------------------------+
| | --------- | --------- |
+--------------------------------------------+--------------------------+--------------------------+
| | | |
+--------------------------------------------+--------------------------+--------------------------+
| | 2008 | 2007 |
+--------------------------------------------+--------------------------+--------------------------+
| | Cents | Cents |
+--------------------------------------------+--------------------------+--------------------------+
| | | |
+--------------------------------------------+--------------------------+--------------------------+
| Basic earnings per share | 47.6 | 34.1 |
+--------------------------------------------+--------------------------+--------------------------+
| Effect of dilutive potential ordinary | (0.7) | (2.2) |
| shares | | |
+--------------------------------------------+--------------------------+--------------------------+
| | -------- | -------- |
+--------------------------------------------+--------------------------+--------------------------+
| Diluted earnings per share | 46.9 | 31.9 |
+--------------------------------------------+--------------------------+--------------------------+
| | -------- | -------- |
+--------------------------------------------+--------------------------+--------------------------+
8. BORROWINGS AND NET DEBT
+----------------------------+---------------------+-----------------+--------------+
| | 6 months ended | Year ended |
| | 31 December | 30 June |
+----------------------------+---------------------------------------+--------------+
| | | | |
+----------------------------+---------------------+-----------------+--------------+
| | 2008 | 2007 | 2008 |
+----------------------------+---------------------+-----------------+--------------+
| | $'millions | $'millions | $'millions |
+----------------------------+---------------------+-----------------+--------------+
| Cash | | | |
+----------------------------+---------------------+-----------------+--------------+
| Bank | 0.9 | 0.4 | 1.2 |
+----------------------------+---------------------+-----------------+--------------+
| | _______ | _______ | _______ |
+----------------------------+---------------------+-----------------+--------------+
| Borrowings | | | |
+----------------------------+---------------------+-----------------+--------------+
| Bank loans | 485.1 | 309.6 | 410.9 |
+----------------------------+---------------------+-----------------+--------------+
| Loan costs | (18.0) | (4.9) | (18.7) |
+----------------------------+---------------------+-----------------+--------------+
| | _______ | _______ | _______ |
+----------------------------+---------------------+-----------------+--------------+
| | 467.1 | 304.7 | 392.2 |
+----------------------------+---------------------+-----------------+--------------+
| | _______ | _______ | _______ |
+----------------------------+---------------------+-----------------+--------------+
| Net debt | 466.2 | 304.3 | 391.0 |
+----------------------------+---------------------+-----------------+--------------+
| | -------- | -------- | -------- |
+----------------------------+---------------------+-----------------+--------------+
In February 2008 a five year syndicated asset based lending facility was signed
and increased the size of the available banking facility from $356 million to
$425 million. The facility was further increased on 23 June 2008 to $500
million. The syndicated facility is led by Lloyds TSB Commercial Finance and is
secured on Aero Inventory's stock and trade debtors in the UK, Switzerland,
Ireland, Canada, the United States, Hong Kong, Australia and Japan.
At 31 December 2008, the Group had available $14.9 million (30 June 2008:
$89.1m) of undrawn committed borrowing facilities.
The bank loan is secured by a fixed and floating charge which is secured by the
trade receivables and inventory of the Group. The book value of financial
liabilities approximates their fair value.
+--------------------------------+---------------------+---------------------+---------------------+
| | 6 months ended | Year ended |
| | 31 December | 30 June |
+--------------------------------+-------------------------------------------+---------------------+
| | 2008 | 2007 | 2008 |
+--------------------------------+---------------------+---------------------+---------------------+
| | $'millions | $'millions | $'millions |
+--------------------------------+---------------------+---------------------+---------------------+
| The borrowings are repayable | | | |
| as follows: | | | |
+--------------------------------+---------------------+---------------------+---------------------+
| On demand or within one year | | - | - |
+--------------------------------+---------------------+---------------------+---------------------+
| In the second year | | - | - |
+--------------------------------+---------------------+---------------------+---------------------+
| In the third to fifth years | 485.1 | 309.6 | 410.9 |
| inclusive | | | |
+--------------------------------+---------------------+---------------------+---------------------+
| | ----------- | ----------- | ----------- |
+--------------------------------+---------------------+---------------------+---------------------+
| | 485.1 | 309.6 | 410.9 |
+--------------------------------+---------------------+---------------------+---------------------+
| Less: Amount due for | | | |
| settlement within | | | |
+--------------------------------+---------------------+---------------------+---------------------+
| 12 months (shown under current | - | - | - |
| liabilities) | | | |
+--------------------------------+---------------------+---------------------+---------------------+
| | ----------- | ----------- | ----------- |
+--------------------------------+---------------------+---------------------+---------------------+
| Amounts due for settlement | 485.1 | 309.6 | 410.9 |
| after 12 months. | | | |
+--------------------------------+---------------------+---------------------+---------------------+
| | ----------- | ----------- | ----------- |
+--------------------------------+---------------------+---------------------+---------------------+
The interest rate charged on the facility is US Libor + 3%. The average interest
rate charged in the period was 5.78%
NOTES TO THE RESULTS announcement
FOR THE YEAR ENDED 30 June 2008
9. ShARE-BASED PAYMENT
The Company provides benefits to employees (including Directors) of the Company
in the form of share-based payment transactions (share options), whereby
employees render services in exchange for rights over shares ('equity-settled
transactions'). The fair value of the employee services rendered is determined
by reference to the fair value of the options granted.
All share options are valued using an appropriate option-pricing model such as
Black Scholes. This fair value is charged to the profit and loss account over
the vesting period of the share-based payment scheme, with the corresponding
increase in equity. The value of the charge is adjusted in the profit and loss
account over the remainder of the vesting period to reflect expected and actual
levels of options vesting, with the corresponding adjustment made in equity.
The Group has recognised a total expense of $0.7 million relating to equity
settled share option scheme transactions in the period (period to 31 December
2007: $0.6 million )
10. reserves
+------------------------------------+------------+------------+------------+------------+------------+
| | | Share | Share | Retained | Total |
| | | based | based | earnings | |
| | | premium | payment | | |
| | | account | reserve | | |
+------------------------------------+------------+------------+------------+------------+------------+
| | | | | | |
+------------------------------------+------------+------------+------------+------------+------------+
| | | $'millions | $'millions | $'millions | $'millions |
+------------------------------------+------------+------------+------------+------------+------------+
| | | | | | |
+------------------------------------+------------+------------+------------+------------+------------+
| At 1 July 2007 | | 210.3 | 2.0 | 40.5 | 252.8 |
+------------------------------------+------------+------------+------------+------------+------------+
| Profit for the financial period | | - | - | 51.6 | 51.6 |
+------------------------------------+------------+------------+------------+------------+------------+
| Dividends paid | | - | - | (15.7) | (15.7) |
+------------------------------------+------------+------------+------------+------------+------------+
| Share based payments | | - | 1.3 | - | 1.3 |
+------------------------------------+------------+------------+------------+------------+------------+
| Shares issued | | 1.8 | - | - | 1.8 |
+------------------------------------+------------+------------+------------+------------+------------+
| Taxation on share based payments | | - | - | 1.4 | 1.4 |
+------------------------------------+------------+------------+------------+------------+------------+
| | | ---------- | ---------- | ---------- | ---------- |
+------------------------------------+------------+------------+------------+------------+------------+
| At 30 June 2008 and 1 July 2008 | | 212.1 | 3.3 | 77.8 | 293.2 |
+------------------------------------+------------+------------+------------+------------+------------+
| Profit for the financial period | | - | - | 22.7 | 22.7 |
+------------------------------------+------------+------------+------------+------------+------------+
| Dividends paid | | - | - | (8.7) | (8.7) |
+------------------------------------+------------+------------+------------+------------+------------+
| Share based payments | | - | 0.7 | - | 0.7 |
+------------------------------------+------------+------------+------------+------------+------------+
| Foreign currency translation | | - | - | 3.3 | 3.3 |
| reserve | | | | | |
+------------------------------------+------------+------------+------------+------------+------------+
| Taxation on share based payments | | - | - | (1.1) | (1.1) |
+------------------------------------+------------+------------+------------+------------+------------+
| | | ---------- | ---------- | ---------- | ---------- |
+------------------------------------+------------+------------+------------+------------+------------+
| At 31 December 2008 | | 212.1 | 4.0 | 94.0 | 310.1 |
+------------------------------------+------------+------------+------------+------------+------------+
| | | ---------- | ---------- | ---------- | ---------- |
+------------------------------------+------------+------------+------------+------------+------------+
11. subsequent events
As mentioned in the Chief Executive's Statement, the Company has in February
completed the sale of a significant quantity of consumable aircraft parts to Air
Canada. The consideration received by the company for this material is in the
form of Bills of Exchange with a face value of approximately $100 million,
maturing in just less than one year from the date of issue.
The Company had also completed the placing of 4,762,680 ordinary shares with
certain existing shareholders at a price of GBP2.50 ($3.63) per share, raising
additional capital of GBP11.9 million ($17.3 million ). The shares placed
represents approximately 10 percent of the Company's existing issued share
capital and approximately 9.1 percent of the Company's issued share capital
following the placing.
12. Availability of Information
Copies of this announcement are available from the company secretary at 30
Lancaster Road, New Barnet, Hertfordshire, EN4 8AP
INDEPENDENT REVIEW REPORT TO AERO INVENTORY PLC
We have been engaged by the company to review the condensed set of financial
statements in the half-yearly financial report for the six months ended 31
December 2008 which comprises the consolidated income statement, the
consolidated balance sheet, the consolidated statement of recognized income and
expense, the consolidated cash flow statement and related notes 1 to 12. We have
read the other information contained in the half-yearly financial report and
considered whether it contains any apparent misstatements or material
inconsistencies with the information in the condensed set of financial
statements.
This report is made solely to the company in accordance with International
Standard on Review Engagements 2410 issued by the Auditing Practices Board. Our
work has been undertaken so that we might state to the company those matters we
are required to state to them in an independent review report and for no other
purpose. To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the company, for our review work, for this
report, or for the conclusions we have formed.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and has been approved
by, the directors. The directors are responsible for preparing the half-yearly
financial report in accordance with the AIM Rules of the London Stock Exchange.
As disclosed in note 1, the annual financial statements of the Group are
prepared in accordance with IFRSs as adopted by the European Union. The
condensed set of financial statements included in this half-yearly financial
report have been prepared in accordance with the accounting policies the Group
intends to use in preparing its next annual financial statements.
Our responsibility
Our responsibility is to express to the Company a conclusion on the condensed
set of financial statements in the half-yearly financial report based on our
review.
Scope of Review
We conducted our review in accordance with International Standard on Review
Engagements (UK and Ireland) 2410, "Review of Interim Financial Information
Performed by the Independent Auditor of the Entity" issued by the Auditing
Practices Board for use in the United Kingdom. A review of interim financial
information consists of making inquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other review
procedures. A review is substantially less in scope than an audit conducted in
accordance with International Standards on Auditing (UK and Ireland) and
consequently does not enable us to obtain assurance that we would become aware
of all significant matters that might be identified in an audit. Accordingly, we
do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe
that the condensed set of financial statements in the half-yearly financial
report for the six months ended 31 December 2008 is not prepared, in all
material respects, in accordance with the AIM Rules of the London Stock
Exchange.
Deloitte LLP
Chartered Accountants and Statutory Auditors
Reading, United
Kingdom
16 March 2009
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR ZGGMFRVMGLZG
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