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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Eleksen Grp | LSE:ELG | London | Ordinary Share | GB00B12GJ944 | ORD 5P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 9.00 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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RNS Number:1866J
Eleksen Group PLC
20 September 2006
ELEKSEN GROUP plc
MAIDEN FIGURES SHOW STRONG SALES GROWTH IN FIRST HALF
REDUCTION IN PRODUCTION COSTS
STRENGTHENING SALES PIPELINE
September 20, 2006
Eleksen Group plc, which makes smart fabrics that can be used to control
electronic devices such as smart phones and MP3 players, today reported its
first set of results following the company's admission to AIM in May this year.
Interim results for the six months to 30 June 2006 showed sales ahead by seven
times compared with last year, the successful delivery of planned production
cost objectives and good customer and contract wins.
Financial Highlights
* Turnover for first six months #1.8 million
* Turnover up by 622% over same period 2005
* Operating loss #2.3m, including reverse takeover costs, in line with
expectations
* Unit cost reduction programme achieved helping drive volume growth
Operational Highlights
* Successful development of production capability, with over 200,000 units
shipped during the half year, compared with 100,000 units for the whole of
2005
* Increasing repeat business from existing customers. Development of
customer relationships including:
* Belkin, a major Apple iPod accessory supplier;
* Olivet International and Goodhope Bags, vendors to major US Retailers
including Target, CompUSA and BestBuy;
* Bagir, suit provider to Marks & Spencer;
* Bluetooth fabric keyboard launched
* Development of Ultra Mobile PC fabric keyboard prototype for Microsoft
* Resource development with staff levels up from 21 to 30
* Appointment of Vice President Sales to the management team
Commenting on the results Robin Shephard, Chief Executive, said:
"This is a good start to the year which fully supports the confidence in the
business we expressed when we came to market in May. We have seen strong growth
in the first half and we have made positive progress in the Company's strategic
development. We are investing in people and product development to underpin the
Group's long term growth. In the immediate future, the sales pipeline for new
business remains strong.
We have seen some good customer wins in the year and recent developments with
Belkin, a major Apple iPod accessory supplier and with Bagir, for its iPod
enabled fashion suit, together with other discussions, reinforces the Board's
belief that the Group is well positioned not only to compete in, but to lead
this fast growing market."
Enquiries:
Eleksen Group plc 08700 727 272
Robin Shephard (Chief Executive Officer)
Ted Bechman (Finance Director)
Cubitt Consulting 020 7367 5100
Michael Henman
CHAIRMAN'S STATEMENT
The first six months of the year have been an extremely busy time for the Group,
during which a number of key objectives were achieved.
* First half revenues exceed those for the whole of 2005 by 38%
* Scaled manufacturing capability in Asia
* Deliveries for the period to June 2006 more than double the whole of 2005
* Product costs reduced significantly
* Admission to AIM
Trading results
Turnover in the six months ended 30 June increased by 622% to #1.8m (2005:
#250k). This compares with turnover for the whole of 2005 of #1.3m. Operating
loss, after adjusting for the impairment of goodwill arising on the admission to
AIM of #0.74m, was #1.54m (2005: loss #1.26m).
Sales growth
I am delighted with the growth in sales achieved during the first six months of
the year, which fully supports our confidence at the time of the AIM admission
in May. This high level of activity has made effective use of our existing
resources and this, together with the outlook for new business conversion, has
been part of the reason for the level of staff recruitment.
The sales pipeline remains strong, with the Group expecting to further
capitalise on initial sales and progress made with a range of customers. These
include Belkin, a major Apple iPod accessory supplier; Olivet International and
Goodhope Bags, vendors to major US Retailers including Target, CompUSA and
BestBuy; and Bagir, suit provider to Marks & Spencer. During the period the
Company also launched its Bluetooth Fabric Keyboard. This resulted in a joint
initiative with Microsoft for the provision of a prototype keyboard for the
Ultra Mobile PC.
Operations
Despite this high level of activity and the admission to AIM, we have continued
to deliver excellent levels of client support and performance. The Company has
demonstrated its ability to scale production, with volume shipped in the first
half of 2006 being more than double the total for the whole of 2005. An ongoing
unit cost reduction programme has been successfully implemented, helping to
drive the higher volumes.
Resourcing
With existing resources fully utilised, we have been working hard to put in
place the infrastructure needed for our growth plans across all disciplines.
Total staff numbers have increased from 21 at 1 January 2006 to 30 at present.
As a result, operating costs have increased compared to the prior year.
Sales function and strategy
We appointed Joe Bosurgi as Vice President Sales and he has already made
important developments in structuring the sales function. Joe has extensive
global experience and has worked in both the Far East and the US, key markets
for the Company.
Admission to AIM
The performance in the first half of the year was achieved during a period which
saw the company successfully admitted to AIM through its reversal into a cash
shell, providing both a liquidity event for existing shareholders and greater
flexibility for the Company to raise further funds in the future to facilitate
expansion.
Dividend
In line with the dividend policy set out at the time of the admission to AIM no
interim dividend is being recommended.
Conclusion and Outlook
This is a good start to the year which fully supports the confidence in the
business we expressed when we came to market in May. We have seen strong growth
in the first half and we have made positive progress in the Company's strategic
development. We are investing in people and product development to underpin the
Group's long term growth. In the immediate future, the sales pipeline for new
business remains strong.
We have seen some good customer wins in the year and recent developments with
Belkin, a major Apple iPod accessory supplier and with Bagir, for its iPod
enabled fashion suit, together with other discussions, reinforces the Board's
belief that the Group is well positioned not only to compete in, but to lead
this fast growing market.
September 20, 2006
Company Registration No. 05372849 (England and Wales)
ELEKSEN GROUP PLC
INTERIM RESULTS FOR THE PERIOD 1 JANUARY 2006 TO 30 JUNE 2006
ELEKSEN GROUP PLC
CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE PERIOD 1 JANUARY to 30 JUNE 2006
Unaudited Unaudited Unaudited
Period Period Year
1 January to 1 January to ended
to 30 June to 30 June 31 December
2006 2005* 2005*
Notes # # #
Turnover 1,804,084 249,952 1,308,218
Cost of sales (1,360,267) (326,572) (966,789)
---------- --------- ---------
Gross profit 443,817 (76,620) 341,429
Administrative expenses (2,724,032) (1,232,745) (3,166,249)
Other operating income - 46,479 74,912
---------- --------- ---------
Operating loss (2,280,215) (1,262,886) (2,749,908)
---------- --------- ---------
+----------------------------------------------------------------------------------------+
| Operating loss analysed as: |
| Operating profit before |
| exceptional items (1,537,551) (1,262,886) (2,749,908)|
| Exceptional goodwill |
| impairment (742,664) - - |
+----------------------------------------------------------------------------------------+
---------- --------- ---------
Other interest receivable
and similar income 31,851 18,015 24,952
Interest payable and
similar charges (577) - (5,180)
---------- --------- ---------
Loss on ordinary
activities before taxation (2,248,941) (1,244,871) (2,730,136)
Tax on loss on ordinary activities - - -
---------- --------- ---------
Loss for the period 4 (2,248,941) (1,244,871) (2,730,136)
========== ========= =========
Loss per share (pence)
Basic and diluted 2 (5.88) (3.29) (7.21)
The profit and loss account has been prepared on the basis that all operations
are continuing operations.
The profit and loss account contains all recognised gains and losses for the
year and preceding year.
* As restated - see note 6
ELEKSEN GROUP PLC
CONSOLIDATED BALANCE SHEET
AS AT 30 JUNE 2006
Unaudited Unaudited Unaudited
At 30 June At 30 June At 31 December
2006 2005* 2005*
Notes # # #
Fixed assets
Intangible assets 147,254 178,428 139,902
Tangible assets 73,095 48,007 48,020
---------- --------- ---------
220,349 226,435 187,922
Current assets
Stocks 403,088 210,098 126,061
Debtors 1,170,029 226,059 1,164,074
Cash at bank and in hand 1,368,877 913,392 2,720,513
---------- --------- ---------
2,941,994 1,349,549 4,010,648
Creditors: amounts
falling due within one year (1,638,716) (491,250) (1,195,793)
---------- --------- ---------
Net current assets 1,303,278 858,299 2,814,855
---------- --------- ---------
Total assets less
current liabilities 1,523,627 1,084,734 3,002,777
========== ========== ==========
Capital and reserves
Called up share capital 3 2,047,409 1,894,056 1,894,056
Share premium account 4 494,455 - -
Reverse acquisition reserve 4 15,308,637 11,790,819 15,189,237
Other reserves 4 6,289 (1,184) 3,706
Profit and loss account 4 (16,333,163) (12,598,957) (14,084,222)
---------- --------- ---------
Shareholders' funds 5 1,523,627 1,084,734 3,002,777
========== ========== ==========
* As restated - see note 6
ELEKSEN GROUP PLC
CONSOLIDATED CASH FLOW STATEMENT
FOR THE PERIOD 1 JANUARY TO 30 JUNE 2006
Unaudited Unaudited Unaudited
Period Period Year
1 January to 1 January to ended
to 30 June to 30 June 31 December
2006 2005* 2005*
# # #
Net cash outflow from operating
activities (1,844,688) (1,359,182) (3,025,376)
Returns on investments and
servicing of finance
Interest received 31,851 18,015 24,952
Interest paid (577) - (5,180)
--------- --------- ---------
Net cash inflow for returns on
investments and servicing of
finance 31,274 18,015 19,772
Capital expenditure and financial investment
Payments to acquire intangible assets (48,039) - (100,081)
Payments to acquire tangible assets (28,314) (101,029) (69,986)
Payments to acquire investments - - (60)
--------- --------- ---------
Net cash outflow for capital
expenditure and financial investment (76,353) (101,029) (170,127)
Acquisitions and disposals
Reverse acquisition of parent undertaking (305,769) - -
Cash acquired with acquisition 457,059 - -
--------- --------- ---------
Net cash inflow for acquisitions and disposals 151,290 - -
--------- --------- ---------
Net cash outflow before management of
liquid resources and financing (1,738,477) (1,442,196) (3,175,731)
Financing
Issue of ordinary share capital
Eleksen Ltd 361,417 2,146,901 5,687,557
Expenses paid in connection with share issue (19,085) - -
Exercise of share options 44,509 - -
--------- --------- ---------
Net cash inflow from financing 386,841 2,146,901 5,687,557
--------- --------- ---------
(Decrease)/increase in cash in the period (1,351,636) 704,705 2,511,826
========= ========= =========
* As restated - see note 6
ELEKSEN GROUP PLC
NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT
FOR THE PERIOD 1 JANUARY TO 30 JUNE 2006
Unaudited Unaudited Unaudited
Period Period Year
1 January to 1 January to ended
to 30 June to 30 June 31 December
Reconciliation of operating loss to net cash
outflow from operating activities 2006 2005* 2005*
# # #
Operating loss (2,280,215) (1,262,886) (2,749,908)
Depreciation of tangible assets 23,924 3,487 22,130
Amortisation of intangible assets 783,317 21,097 109,690
(Increase) in stocks (277,027) (145,944) (61,907)
(Increase)/decrease in debtors (45,604) 53,425 (884,590)
(Decrease)/increase in creditors within one year (51,665) (33,252) 529,428
FRS 20 Share option expense 2,582 4,891 9,781
--------- --------- ---------
Net cash outflow from operating activities (1,844,688) (1,359,182) (3,025,376)
========= ========= =========
Analysis of net funds 1 January 2006 Cash flow Other non-cash 30 June 2006
changes
# # # #
Net cash:
Cash at bank and in hand 2,720,513 (1,351,636) - 1,368,877
--------- --------- --------- ---------
Bank deposits - - - -
Debt:
Finance leases - (20,747) - (20,747)
--------- --------- --------- ---------
Net funds 2,720,513 (1,372,383) - 1,348,130
========= ========= ========= =========
Unaudited Unaudited Unaudited
Period Period Year
1 January to 1 January to ended
to 30 June to 30 June 31 December
Reconciliation of net cash flow to movement in
net funds 2006 2005* 2005*
# # #
(Decrease)/increase in cash in (1,351,636) 704,705 2,511,826
the period
Cash inflow from increase in debt and lease (20,747) - -
financing
--------- --------- ---------
Movement in net funds in the period (1,372,383) 704,705 2,511,826
Opening net funds 2,720,513 208,687 208,687
--------- --------- ---------
Closing net funds 1,348,130 913,392 2,720,513
========= ========= =========
* As restated - see note 6
ELEKSEN GROUP PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD 1 JANUARY TO 30 JUNE 2006
1 Accounting policies
1.1 Accounting convention
The financial information included in this report does not constitute statutory
accounts as defined in section 240 of the Companies Act 1985. The financial
information for the year ended 31 December 2005 has been extracted from the audited
statutory accounts of the legal subsidiary for that period, a copy of which has been
delivered to the Registrar of Companies. The interim accounts for the six months to 30
June 2006 are unaudited.
The figures for the year ended 31 December 2005 are based on the statutory accounts,
which have been filed with the Registrar of Companies and have been restated to take
into account the changes required under FRS 20 and also to include the Company's US
based subsidiary Eleksen Inc. which had been excluded as the Company and its
subsidiary comprised a small sized group and took the available exemption provided by
section 248 of the Companies Act 1985. The auditor's report on the accounts and filed
with the Registrar of Companies was unqualified. These accounts do not comprise
statutory accounts under the meaning of Section 240.
FRS 20 (Share based payment) has been adopted for the first time for the period under
review.
Other than the above exceptions, the interim accounts for the six months ended 30 June
2006 have been prepared on the basis of the accounting policies set out in the
statutory accounts for the year ended 31 December 2005.
1.2 Basis of consolidation and presentation of financial information
On 3 May 2006 the Company, then named Bora Communications Plc, became the legal parent
of Eleksen Limited. Due to the relative values of the companies, the former Eleksen
Limited shareholders became the majority shareholders with 93% of the enlarged share
capital. Further, the Company's continuing operations and executive management were
those of Eleksen Limited. Accordingly, the substance of the combination was that
Eleksen Limited acquired Bora Communications Plc in a reverse acquisition. As part of
the business combination Bora Communications Plc changed its name to Eleksen Group Plc
on 2 May 2006.
Under the requirements of the Companies Act 1985 it would normally be necessary for
the Company's consolidated accounts to follow the legal form of the business
combination. In that case the pre-combination results would be those of Bora
Communications Plc. The results of Eleksen Limited would then be brought into the
Group from 3 May 2006. However, this would portray the combination as an acquisition
of Eleksen Limited by Bora Communications Plc and would, in the opinion of the
Directors, fail to give a true and fair view of the substance of the business
combination. According, the Directors have adopted reverse acquisition accounting as
the basis of consolidation in order to give a true and fair view.
In invoking the true and fair override, the Directors note that reverse acquisition
accounting is allowed under International Financial Reporting Standard 3 and that the
Urgent Issues Task Force of the UK's Accounting Standards Board considered the subject
and concluded that there are instances where it is right and proper to invoke the true
and fair override in such a way.
As a consequence of applying reverse acquisition accounting, the results for the 6
months ended 30 June 2006 comprise the results of Eleksen Limited for the six month
period ended 30 June 2006 plus those of Bora Communications Plc from 3 May 2006, the
date of the reverse acquisition to 30 June 2006. The comparative figures are those of
Eleksen Limited for the twelve months ended 31 December 2005 and six months ended 30
June 2005.
Goodwill amounting to #742,664 arose on the difference between the fair value of Bora
Communications Plc share capital and the fair value of its net assets at the date of
reverse acquisition. Full provision for impairment against the goodwill arising has
been made in the six months ended 30 June 2006 because Bora Communications Plc had no
continuing business and therefore the goodwill had no intrinsic value.
ELEKSEN GROUP PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD 1 JANUARY TO 30 JUNE 2006
2 Earnings per share
Earnings per ordinary share have been calculated using the weighted number of
shares in issue during the relevant financial periods. The weighted average
number of equity shares in issue is 38,220,899 (2005: 37,881,113) and the
earnings, being (loss)/profit after tax, minority interests and preference
dividends, are #(2,248,941) (2005: #(2,730,136)).
Unaudited Unaudited Unaudited
Period Period Year
1 January to 1 January to ended
to 30 June to 30 June 31 December
2006 2005* 2005*
# # #
Reconciliation of earnings:
-----------------------------
Earnings used for calculation of basic
and diluted earnings per share (2,248,941) (1,244,871) (2,730,136)
========= ========= =========
Number Number Number
Reconciliation of denominator:
--------------------------------
Shares used for calculation of basic and
diluted earnings per share 38,220,899 37,881,113 37,881,113
========= ========= =========
* As restated - see note 6
ELEKSEN GROUP PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD 1 JANUARY TO 30 JUNE 2006
Unaudited Unaudited Unaudited
At At At
30 June 30 June 31 December
3 Share capital 2006 2005 2005
# # #
Authorised
57,150,000 Ordinary shares of 5p each 2,857,500 - -
========= ========= ========
Allotted, called up and fully paid
40,948,180 Ordinary shares of 5p each 2,047,409 - -
========= ========= ========
On 3rd May 2006, Bora Communications Plc (the Company) acquired the entire share
capital of Eleksen Limited by way of issuing 37,881,113 new ordinary shares and
a share consolidation of one new ordinary share of 5p each for every five
ordinary shares of 1p each.
The consolidated shares represented approximately 93 per cent of the enlarged
share capital and, in view of the size of Eleksen Limited relative to the
Company, the acquisition constituted a reverse takeover of Bora Communications
Plc under the AIM rules.
As a consequence of applying reverse acquisition accounting (see note 1) the
Group share capital for the comparative periods have been presented as
#1,894,056 to reflect the shares issued in exchange for the share capital of
Eleksen Limited.
On 11th June 2006 the Company issued 217,057 new ordinary 5p shares in respect
of the exercise of share options.
ELEKSEN GROUP PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD 1 JANUARY TO 30 JUNE 2006
4 Statement of movements on reserves
Share premium Reverse Other Profit and
account acquisition reserves loss
reserve (see below) account
# # # #
Balance at 1 January
2006 - 15,189,237 (6,075) (14,074,441)
Prior period FRS 20
adjustment - - 9,781 (9,781)
--------- --------- --------- ---------
As restated * - 15,189,237 3,706 (14,084,222)
Loss for the period - - - (2,248,941)
Reverse acquisition
adjustment 494,455 119,400 - -
FRS 20 share based
payment - - 2,583 -
--------- --------- --------- ---------
Balance at 30 June 2006 494,455 15,308,637 6,289 (16,333,163)
========= ========= ========= =========
Other reserves
Equity based payment reserve
Balance at 1 January 2006 as restated 9,781
Movement during the period 2,583
---------
Balance at 30 June 2006 12,364
=========
ESOP reserve
Balance at 1 January 2006 & at 30 June 2006 (6,075)
=========
* As restated - see note 6
Unaudited Unaudited Unaudited
Period Period Year
1 January to 1 January to ended
to 30 June to 30 June 31 December
5 Reconciliation of movements in
shareholders' funds 2006 2005* 2005*
# # #
Loss for the financial period (2,248,941) (1,244,871) (2,730,136)
Proceeds from issue of shares - 2,146,901 5,687,557
Movements on reverse acquisition
reserve 767,208 142,238 -
Movement on equity based payment
reserve 2,583 4,891 9,781
--------- --------- ---------
Net (decrease)/increase in (1,479,150) 1,049,159 2,967,202
shareholders' funds
Opening shareholders' funds 3,002,777 35,575 35,575
--------- --------- ---------
Closing shareholders' funds 1,523,627 1,084,734 3,002,777
========= ========= =========
* As restated - see note 6
ELEKSEN GROUP PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD 1 JANUARY TO 30 JUNE 2006
6 Share option valuation - prior year adjustment
In order to conform with the requirements of FRS 20 'Share Based Payments',
share options that have been granted to employees have been recognised as
an expense as part of employee remuneration. The cost is spread over the
vesting period and has been calculated using a Monte-Carlo valuation model.
The effect on the comparatives of this change in accounting policy is that
administrative expenses have increased by #4,891 for the six months ended
30 June 2005 and by #9,781 for the year ended 31 December 2005. In the six
months ended 30 June 2006 the charge was #2,583.
Copies of these Financial Statements are available from the Company at its
registered office at Pinewood Studios, Pinewood Road, Iver Heath, Bucks, SL0
0NH.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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