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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Green Comp | LSE:GCO | London | Ordinary Share | GB00B54DP718 | 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% | 1.05 | 0.00 | 00:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Nov 2019 to Nov 2024
TIDMGCO TIDMAPC
RNS Number : 7341N
Green Compliance PLC
30 July 2014
30 July 2014
Green Compliance plc
("Green Compliance" or the "Group")
Preliminary results for the 12 months ended 31 March 2014
Green Compliance provides compliance services across the water hygiene & treatment sector to a wide range of clients in both the UK public and private sectors. The Group is pleased to announce its unaudited preliminary results for the 12 months ended 31 March 2014.
Financial Highlights
-- Revenue of GBP8.1m from continuing operations (2013: GBP9.9m);
-- Cash generated by continuing operations before finance costs and exceptional costs during the year was GBP0.5m (2013: GBP1.1m);
-- Net loss after tax of GBP0.5m (2013: GBP12.0m). This was after charging GBP0.5 m (2013: GBP3.4m) of amortisation, and GBP0.1m (2013: GBP0.1m) of share based payment expense to the income statement, all of which are non-cash.
Operational Highlights
-- Stabilised revenue and customer base following 2013 financial restructuring;
-- Share placing raised GBP3.5m of funds, of which GBP2.75m was used to settle the outstanding HSBC debt which stood at GBP7.4m on 30 September 2013;
-- Loss making Pest and Fire divisions sold for total initial cash consideration of GBP5.2m with funds used to settle debt and bring other creditors into line;
-- Group exited the year completely focussed on building a best in class water hygiene, treatment and management business;
-- Sustainability related water management engagements increasing as focus on the environmental and economic cost of water consumption increases.
Commenting on the results, Bob Holt, Chairman & CEO of Green Compliance, said:
"Following a period of significant reorganisation, the Group is now a focussed, stable water hygiene and treatment business. We see opportunity for growth in the markets that we currently serve and additional opportunity developing as the sustainability of water supply becomes an increasingly high profile issue.
We have already moved the business from being a market leading water hygiene and treatment business to a total water management business but as Directors we recognise that the further development of products and services for these markets may be restricted by the recent trading history of the Group and the restricted access it has to cost effective sources of capital to fund more aggressive growth.
To that end we are hopeful that the potential acquisition of Green Compliance by APC Technology PLC announced on 30 July 2014 will provide the Group's water business, its staff and customers, with an enlarged platform on which it can grow."
About Green Compliance www.greencompliance.com ticker: GCO.L GCO.LN
Enquiries:
Hot Features
Premium
Green Compliance plc
Bob Holt, Chairman and Chief Executive Tel: +44(0)7778 798 816
Richard Hodgson, Chief Operating Tel: +44(0)7880 787 924
Officer
N+1 Singer (Nominated Adviser Tel: +44(0)20 7496 3000
and Broker)
Andrew Craig / Ben Wright
Gable Communications Limited Tel : +44(0) 20 7193 7463 or +44(0)
John Bick/Justine James 7872 061007
Email: gco@gablecommunications.com
STRATEGIC REPORT AND CHAIRMAN'S STATEMENT
For the year ended 31 March 2014
Green Compliance plc made a loss for the year after taxation of GBP538,000 (2013: loss GBP11,972,000). The Directors do not recommend payment of a dividend and the loss has been deducted from reserves.
FINANCIAL RESTRUCTURING
On 5th July 2013 the majority of the trade and assets of the Fire Division were sold to London Securities Limited for total consideration of GBP2m (GBP1.5m in cash and GBP0.5m in deferred consideration). Of the deferred consideration, up to GBP250k has been assigned to HSBC as further settlement on net debt with the remaining GBP250k attributable to the Group providing certain performance conditions are met.
On 11 September 2013 the board announced a conditional Placing of 350,000,000 new Ordinary Shares at 1 pence each to raise GBP3.5 million before expenses. These funds were received by the Group on 27 September 2013. As part of the turnaround plan, discussions were held with HSBC to renegotiate the bank debt. As announced on 11 September 2013, HSBC agreed to accept GBP3.0m in settlement of the outstanding debt, which at 30 September 2013 stood at GBP7.4m.
Following a further review the Board decided to concentrate all the efforts of the Group on the most profitable and cash generative divisions of water hygiene and fire suppression and sold the pest control division to Rentokil Initial plc on 31 December 2013 for total consideration of GBP4.0m cash: GBP3.25m initial consideration, GBP0.15m payable within 3 months dependent on agreement of completion accounts and GBP0.6m deferred consideration payable in 12 months' dependent upon the achievement of certain operational targets of the disposed operations.
On 28th February 2014 the Group sold 100% of its shares in Pyramid Fire Protection Limited to FCF plc for total consideration of GBP0.4m cash.
FOCUS ON BUILDING A COMPLETE WATER MANAGEMENT COMPANY
Having completed the successful refinancing during the year ended 31 March 2014 this, coupled with the divestment of the pest control and fire services divisions, has allowed the Group to exit the year completely focussed on its water hygiene and treatment business.
The Water business is now a national one stop water management company offering all forms of water treatment, water hygiene, including Legionella control, water risk assessments, and water sustainability projects such as rain water capture and grey water re-use.
Taking into account the financial position of the group during the period, this division has performed in line with the board's expectations and has continued to make good progress in the markets which it serves.
Revenue from the Water business in the year was GBP8.1m (2013: GBP9.9m) and operating profit was GBP0.1m stated before one-off operating costs of GBP0.6m (included within administrative expenses) and exceptional restructuring costs of GBP0.4m. The Water business has been successful in retaining existing contracts and has also won contracts with new clients. The division continues to be a preferred supplier on several large framework agreements.
WATER HYGIENE AND TREATMENT MARKET
The basic definition of water treatment is the purifying of water to make it suitable for household or business use. The water treatment industry in the UK was worth an estimated GBP3.8bn in 2013-14. Water treatment requirements are estimated to be split relatively evenly between domestic and commercial/industrial use. Based on the estimated industry value of GBP3.8bn, the commercial areas of the UK water treatment industry are estimated to be valued at circa GBP2bn in 2013-14. A significant percentage of the market relates to the treatment of water in storage, both open and underground reservoirs. The majority of this work is undertaken by the water companies, or large global businesses (e.g. GE Water, Nalco).
However, there is a significant addressable market for water treatment services with large corporate organisations, SMEs and public bodies such as Green services and this is estimated to be worth in excess of GBP1bn per annum.
Under UK government regulations (Health & Safety Act 1974, ACoP (L8) 4th Edition 2013, COSHH 2002 and Water Supply Regulations 1999), anyone serving the public has a legal duty to prepare and manage a scheme for maintaining safe water quality. Hospitality and leisure facilities, healthcare providers, care homes, as well as employers in general, are therefore faced with the same obligation. As well as requiring risk assessments, organisations subject to the legislation would be required to have access to competent help in applying the provisions of health and safety law, water storage and supply and specification for the design, installation, testing and maintenance of services supplying hot and cold water for use within public buildings. All these regulations are principally driven by the necessity to prevent legionella from developing in water systems.
Green Compliance provides a comprehensive service across the water hygiene spectrum and therefore has an addressable market for water hygiene services of an estimated GBP241m and this market is growing at an estimated 5% CAGR.
Neither the GBP1bn addressable market in water treatment nor the GBP241m addressable market in water hygiene factor in the potential market in moves towards greater sustainability products and ultimately the supply of water as the market deregulates.
Water sustainability is becoming an increasing issue:
-- Water consumption is doubling every twenty years, more than two times population growth.
-- Water supplies are threatened by pollution, population growth, urbanization and climate change.
-- There is growing awareness about water quality, safety and security.
-- Water charges are increasing through metering and moves towards charging for the total cost of water.
The Board are focussed on building a best in class water management company that can service these increasing markets.
STATEMENT OF COMPREHENSIVE INCOME
Revenue from continuing operations for the period was GBP8.1m (2013: GBP9.9m).
The group made a loss after tax of GBP0.5m (2013: GBP12.0m loss). This was, however, after charging GBP0.5m (2013: GBP3.4m) of amortisation, and GBP0.1m (2013: GBP0.1m) of share based payment expense to the income statement, all of which are non-cash.
Continuing operating loss before amortisation, share based payments and exceptional items was GBP1.5m (2013: loss of GBP0.9m).
Finance costs are predominantly in relation to the bank facilities with HSBC that have now been settled, interest on loan notes and ABN factoring charges.
In the year ended 31 March 2014 discontinued items relate to the Fire and Pest businesses sold on 5 July 2013 and 31 December 2013 respectively. It also includes the results of the remainder of the Fire division which was sold on 28 February 2014.
STATEMENT OF FINANCIAL POSITION
Net assets at 31 March 2014 were GBP4.4m (2013: GBP1.4m). This includes goodwill of GBP5.7m (2013:GBP9.7m) and other intangible assets of GBP0.5m (2013: GBP1.5m).
Cash and cash equivalents totalled GBP1.6m (2013: GBP1.6m), trade receivables were GBP1.6m (2013: GBP2.8m) and trade payables were GBP1.5m (2013: GBP2.2m).
We have deferred consideration payable over the next 12 months of GBP118k. This will be satisfied through cash generation and the group's working capital facilities.
STATEMENT OF CASH FLOWS
Cash generated by continuing operations before finance costs and exceptional costs during the year was GBP0.5m (2013: GBP1.1m). Significant progress has been made throughout the last 12 months in driving down debtor days.
LOSS PER SHARE
Normalised basic loss per share ('LPS') for the year ended 31 March 2014 of 0.42p (2013: re-stated loss 1.08p) is stated before amortisation of intangible assets and exceptional items but after expensing a normalised tax charge. We believe that this normalised basic LPS measure better allows the assessment of operational performance, the analysis of trends over time, the comparison of different businesses and the projection of future performance.
RISK MANAGEMENT
Risk is an accepted part of doing business. The group's financial risk management is based upon sound economic objectives and good corporate practice. The board has overall responsibility for risk management and internal control within the context of achieving the group's objectives.
Our process for identifying and managing risks is set out in more detail within the Corporate Governance Statement. The key risks and mitigating factors are set out below. The group seeks to manage financial risk, to ensure sufficient liquidity is available to meet the identifiable needs of the group and to invest cash assets safely and profitably. Short-term flexibility is achieved through the use of the bank overdraft and working capital facilities.
The group does not undertake any trading activity in financial instruments. All activities are transacted in Sterling.
The group reviews the credit quality of customers and limits credit exposures accordingly. All trade receivables are subject to credit risk exposure. However, there is no specific concentration of credit risk as the amounts recognised represent a large number of receivables from various customers.
A comprehensive risk management structure is in place at a strategic and operational level to identify, manage and mitigate those business risks which could impact the group's long-term performance or service delivery to clients.
PRINCIPAL RISKS AND UNCERTAINTIES
LIQUIDITY RISKS AND GOING CONCERN
Whilst the directors recognised the positive progress that had been made as a result of the turnaround plan put in place at the beginning of 2013 pressure continued to be placed upon the group's cash flow and working capital.
This required the Directors, along with key stakeholders, to re-evaluate the group's strategy and seek additional funding to support the immediate working capital needs of the group. On 11 September 2013 the board announced a conditional Placing of 350,000,000 new Ordinary Shares at 1 pence each to raise GBP3.5 million before expenses.
These funds were received by the Group on 27 September 2013. As part of the turnaround plan, discussions were held with HSBC to renegotiate the bank debt. At 31 March 2013, this comprised a bank loan of GBP7.4m and an overdraft of GBP1.6m. As announced on 11 September 2013, HSBC agreed to accept GBP3.0m in settlement of the outstanding debt, which at 30 September 2013 stood at GBP7.4m.
The settlement amount comprised GBP2.75m in cash which was raised from the Placing (see above) and the assignment of GBP250k deferred consideration potentially recoverable from the sale of the Fire Division (see note 7). HSBC have no recourse to the Group in the event of non-payment. Having reviewed the Group's tax position at 31 March 2014 we are able to confirm that no corporation tax charge has arisen as a result of the debt waiver.
Subsequent to the repayment made to HSBC, the Group secured a working capital facility from ABN Amro Commercial Finance for GBP1.2m and has an additional shareholder facility of GBP650k.
The Board view that the positive cash balance, the ABN facility and the additional shareholder working capital facilities (which both run until the end of November 2015) are sufficient for the working capital needs of the business for the foreseeable future. The Directors therefore believe it remains appropriate to prepare the financial statements on a going concern basis.
CREDIT RISK
Credit risk is the risk of financial loss to the group if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the group's receivables from customers.
The group ensures that customers are contacted on issue of invoices to ensure that they meet the customer's expectations. Efforts are then made to collect the monies that are outstanding as soon as they fall due. After all reasonable attempts have been made to ensure collection of outstanding monies the group would consider the use of legal action in an attempt to secure any outstanding monies that it has a legal right to.
MARKET RISKS
Current economic conditions may adversely affect the financial performance of some parts of the business. This risk is mitigated through a monthly review of the financial trading performance of the business compared to budget and forecasts. Cash, working capital and credit exposures are closely monitored at all levels across the group.
INTEREST RATE RISK
The Group finances its operations through a mixture of cash, convertible loan notes and bank borrowings. The Group exposure to interest rate fluctuations on its borrowings is managed by the use of both fixed and floating facilities as the Board consider necessary.
OPERATIONAL RISKS
Sub-contractors and suppliers
The business is at risk from the over-reliance on key suppliers and sub-contractors and the quality of their work affecting customer relationships. The group has taken steps to monitor the quality of all suppliers used and has adequate insurance in place.
Litigation
The group has extensive insurance cover which is reviewed annually by the board. The group has policies and procedures in place to report any incidents as they occur which may potentially lead to litigation.
Attracting and retaining key staff
The business is faced with the risk of losing key management with the appropriate skill level to deliver the strategic potential of the group. This risk is mitigated through the implementation of competitive benefits packages including share scheme participation, training programmes at all levels and career development and succession plans.
MANAGING OUR FUTURE GROWTH
Financial and operational performance is monitored and reviewed on a monthly basis and this information is fed to the board to allow them to form a detailed understanding of the status of the business.
This close monitoring allows the board to fulfil its responsibility to:
- approve and oversee delivery of our growth strategy and short and medium-term business objectives
- set group policies - maintain our financial performance - oversee our internal controls
RECOMMENDED SHARE OFFER BY APC TECHNOLOGY PLC FOR GREEN COMPLIANCE PLC
On 30 July 2014, the boards of Green Compliance PLC and APC Technology PLC "APC" announced that they had agreed the terms of a transaction between APC and Green Compliance, whereby the entire share capital of Green Compliance would be acquired by APC in consideration for the issue of APC shares. The Offer is to be implemented by means of a Scheme of Arrangement under Part 26 of the Companies Act, which requires the approval of Scheme Shareholders and the sanction of the Scheme by the Court.
The Green Compliance Directors have overseen a considerable period of restructuring in the past eighteen months as detailed above and whilst this financial restructuring is complete they believe that the offer from APC should be considered by Green Compliance Shareholders taking into account a number of considerations as detailed in the announcement. Principally the Green Compliance Directors believe it will allow Green Compliance customers, staff and shareholders access to an Enlarged Group focussed on building further expertise and businesses in the area of sustainability.
Unless otherwise defined, all capitalised terms in this paragraph are defined in the announcement relating to the Offer, released on 30 July 2014.
OUTLOOK
Following a period of significant reorganisation, Green Compliance is now a focussed, stable water hygiene and treatment business which offers a platform for growth in the markets it services.
The Green Compliance Directors recognise that this growth may be restricted by the recent trading history of the Green Group and the restricted access it has to cost effective sources of capital to fund more aggressive growth.
To that end we are hopeful that the potential acquisition above will complete and give the Green Compliance water business, its staff and customers, that enlarged platform on which it can grow.
Bob Holt Richard Hodgson
30 July 2014 30 July 2014
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 31 March 2014
Year ended Year ended
31 March 2014 31 March 2013
Total Total
Note GBP000 GBP000
Continuing operations:
Revenue 8,131 9,888
Cost of sales (5,282) (5,535)
-------------- --------------
Gross profit 2,849 4,353
Administrative expenses (1,673) (8,758)
Operating loss before exceptional items, share based payments and amortisation
of intangibles 2 (1,465) (853)
Exceptional items 3,154 (44)
Share based payments (63) (78)
Amortisation of intangibles (450) (3,430)
-------------------------------------------------------------------------------- ---- -------------- --------------
Operating profit/(loss) 1,176 (4,405)
Finance costs (312) (380)
-------------- --------------
Profit/(loss) from continuing operations before taxation 864 (4,785)
Income tax credit - 1,750
-------------- --------------
Profit/(loss) after taxation 864 (3,035)
Discontinued operations:
Loss for the period from discontinued operations (1,402) (8,397)
-------------- --------------
Loss for the year attributable to equity holders (538) (11,972)
Other comprehensive income - -
Total comprehensive expense for the year (538) (11,972)
Basic and diluted profit/(loss) per share on continuing activities (pence) 4 0.25 (3.28)
Basic and diluted loss per share on discounted activities (pence) 4 (0.41) (9.67)
Basic and diluted loss per share on all activities (pence) 4 (0.16) (12.95)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
For the year ended 31 March 2014
At At
31 March 31 March
2014 2013
GBP000 GBP000
ASSETS
Non-current assets
Intangible assets 6,182 11,144
Property, plant and equipment 38 245
---------- ----------
6,220 11,389
---------- ----------
Current assets
Inventories 92 255
Trade and other receivables 1,778 3,630
Cash and cash equivalents 1,627 1,584
Total current assets 3,497 5,469
---------- ----------
Assets held for sale - 1,680
---------- ----------
Total assets 9,717 18,538
---------- ----------
LIABILITIES
Current liabilities
Trade and other payables (3,652) (5,028)
Deferred consideration (118) (670)
Bank and other loans (845) (887)
Total current liabilities (4,615) (6,585)
---------- ----------
Liabilities held for sale - (180)
---------- ----------
Non-current liabilities
Bank and other loans (750) (9,743)
Deferred consideration - -
Deferred tax - (633)
Total non-current liabilities (750) (10,376)
---------- ----------
Total liabilities (5,365) (17,141)
Net assets 4,352 1,397
---------- ----------
Shareholders' equity
Called up share capital 22,599 19,099
Share premium account 4,773 4,773
Capital contribution 900 900
Merger reserve 898 898
Share based payment reserve 494 509
Profit and loss reserve (26,692) (26,162)
Capital redemption reserve 1,380 1,380
Attributable to equity holders of the company 4,352 1,397
---------- ----------
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 March 2014
Share
Profit Capital based Capital
Share Share and loss redemption payment contri-bution Merger
capital premium reserve reserve reserve reserve Equity
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
Balance as at
1 April 2012 18,204 4,070 (14,190) 1,380 431 900 898 11,693
Share based
payment - - - - 78 - - 78
Share issue 895 894 - - - - - 1,789
Share issue
costs - (191) - - - - - (191)
Transactions
with owners 895 703 - - 78 - - 1,676
--------------- ---------- ---------- ----------- ------------- --------- --------------- ---------- ---------
Loss for the
period - - (11,972) - - - - (11,972)
Total
comprehensive
expenditure
for the
period - - (11,972) - - - - (11,972)
--------------- ---------- ---------- ----------- ------------- --------- --------------- ---------- ---------
Balance as at
31 March 2013 19,099 4,773 (26,162) 1,380 509 900 898 1,397
--------------- ---------- ---------- ----------- ------------- --------- --------------- ---------- ---------
Share based
payment - - - - 63 - - 63
Share issue 3,500 - (70) - - - - 3,430
Share options
vested/lapsed - - 78 - (78) - - -
--------------- ---------- ---------- ----------- ------------- --------- --------------- ---------- ---------
Transactions
with owners 3,500 - 8 - (15) - - 3,493
--------------- ---------- ---------- ----------- ------------- --------- --------------- ---------- ---------
Loss for the
period - - (538) - - - - (538)
--------------- ---------- ---------- ----------- ------------- --------- --------------- ---------- ---------
Total
comprehensive
expenditure
for the
period - - (538) - - - - (538)
--------------- ---------- ---------- ----------- ------------- --------- --------------- ---------- ---------
Balance as at
31 March 2014 22,599 4,773 (26,692) 1,380 494 900 898 4,352
--------------- ---------- ---------- ----------- ------------- --------- --------------- ---------- ---------
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 31 March 2014
31 March 31 March
2014 2013
GBP000 GBP000
Cash flows from operating activities
Profit/(loss) for the period before taxation 864 (4,785)
Depreciation of property, plant and equipment 19 58
Amortisation of intangible assets 450 2,483
Share based payment charge 63 78
Loss on disposal of fixed assets 10 -
Net finance costs 312 381
Loan waiver (4,618)
Decrease in trade and other receivables 1,280 2,492
Decrease in inventories 63 81
(Decrease)/increase in trade and other payables (302) 69
--------- ---------
Net cash generated used by continuing operations (1,859) 1,217
Discontinued operations
Loss for the period (1,402) (8,937)
Profit on sale of net assets and shares (665) -
Depreciation of property, plant and equipment 39 13
Amortisation of intangible assets - 3,977
Impairment of intangible assets - 3,949
Working capital movement re disposal group 961 (873)
--------- ---------
Net cash used by discontinued operations (1,067) (1,871)
--------- ---------
Net cash used by operations (2,926) (654)
--------- ---------
Finance costs paid (312) (381)
Income taxes paid (55) (178)
--------- ---------
Net cash used by operating activities (3,293) (1,213)
--------- ---------
Cash flows from investing activities
Deferred consideration paid (552) (598)
Proceeds from disposal of net assets and subsidiary 5,185 -
Disposal costs (310) -
Purchase of property, plant and equipment - (1)
Purchase of software - (11)
Purchase of property, plant and equipment by disposal group - (20)
--------- ---------
Net cash used in investing activities 4,323 (630)
--------- ---------
Cash flows from financing activities
Gross proceeds from issue of ordinary shares 3,500 1,789
Share placing costs (70) (191)
(Reduction)/Increase in borrowings (4,377) 1,828
Repayment of hire purchase (40) (40)
--------- ---------
Net cash generated from financing activities (987) 3,386
--------- ---------
Net increase in cash and cash equivalents 43 1,543
Cash and cash equivalents at beginning of the period 1,584 41
--------- ---------
Cash and cash equivalents at end of the period 1,627 1,584
--------- ---------
1 BASIS OF PREPARATION
The consolidated financial statements have been prepared in accordance with applicable International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board as adopted by the EU.
The financial statements have been prepared under the historical cost convention. The principal accounting policies of the group are set out below.
The accounting policies adopted in these financial statements have been applied throughout all periods and comply with each IFRS that is mandatory for accounting periods ending on 31 March 2014.
2 EXCEPTIONAL OPERATING ITEMS
2014 2013
GBP000 GBP000
Restructuring costs (1,464) -
Integration support - (44)
Profit on loan waiver 4,618 -
-------- -------
3,154 (44)
-------- -------
In the year ended 31 March 2014 there were GBPnil of costs incurred in respect of the further integration of the companies acquired in the previous years, included within continuing operations (2013: GBP44,000). The restructuring costs in the current year relate to raising funds and disposals of the Fire and Pest divisions.
The loan waiver amount of GBP4.6m arose following the full and final settlement of debt obligations owing to HSBC. Immediately prior to this agreement the Group owed GBP7.4m. Following the share placing (note 17) and the assignment of deferred consideration of GBP250k the residual balance was GBP4.6m. This was formally waived by HSBC on 30 September 2013.
3 DISCONTINUED OPERATIONS
a) Fire Division
On 5 July 2013 the majority of the trade and assets of the Fire Division were sold to London Securities Limited for total consideration of GBP2m (GBP1.5m in cash and GBP0.5m in contingent consideration). Of the contingent consideration, up to GBP250k has been assigned to HSBC as further settlement on net debt with the remaining GBP250k attributable to the Group providing certain performance conditions are met. HSBC have no recourse to the Group in the event of non-payment. The directors have considered the fair value of this contingent consideration in accordance with IAS 39 and consider the carrying value of the contingent consideration to be GBPnil at the date of the transaction and at 31 March 2014.
The net assets and liabilities at the date of disposal were as follows:
5 July 2013
GBP000
Intangible assets 260
Inventories 80
Trade and other receivables 309
Cash and cash equivalents -
Trade and other payables (176)
Deferred tax liability (443)
------------
Net assets disposed 30
Cash Consideration 1,500
Disposal costs (148)
------------
Profit on disposal 1,322
------------
3 DISCONTINUED OPERATIONS (CONTINUED)
The results prior to the disposal on 5 July 2013 for the discontinued operations included in the consolidated income statement were:
31 March 31 March
2014 2013
GBP000 GBP000
Revenue 611 2,285
Operating loss (1,540) (6,008)
Loss before taxation (1,540) (6,008)
--------- ---------
Profit on disposal of discontinued operations 1,322 -
--------- ---------
(Loss) after tax from discontinued operations (218) (6,008)
--------- ---------
The Fire Division contributed the following to the Group's cashflows to 5th July 2013:
31 March 31 March
2014 2013
GBP000 GBP000
Operating cashflows (619) (1,985)
Investing activities 1,352 -
Financing activities - -
b) Pest Division
On 31 December 2013 the trade, assets and current liabilities of the Pest Division were sold to Rentokil Initial PLC for total consideration of GBP4m (GBP3.25m in cash and GBP0.75m in contingent consideration providing certain performance conditions are met). The directors have considered the fair value of this contingent consideration in accordance with IAS 39 and consider the carrying value of the contingent consideration to be GBPnil at the date of the transaction and at 31 March 2014.
The net assets and liabilities at the date of disposal were as follows:
31 December 2013
GBP000
Property, plant and equipment 37
Inventories 36
Trade and other receivables 697
Cash and cash equivalents -
Trade and other payables (888)
Consolidated goodwill 3,692
Net assets disposed 3,574
Cash Consideration 3,250
Disposal costs (145)
-----------------
Loss on disposal (469)
-----------------
3 DISCONTINUED OPERATIONS (CONTINUED)
b) Pest Division (continued)
The results prior to the disposal on 31 December 2013 for the Pest Division included in the consolidated income statement were:
31 March 31 March
2014 2013
GBP000 GBP000
Revenue 3,390 5,011
Operating loss (447) (3,361)
--------- ---------
Loss before taxation (447) (3,361)
Taxation - -
---------
Loss on disposal of discontinued operations (469) -
--------- ---------
Loss after tax from discontinued operations (916) (3,361)
--------- ---------
The Pest Division contributed the following to the Group's cashflows to 31 December 2013:
31 March 31 March
2014 2013
GBP000 GBP000
Operating cashflows (804) (409)
Investing activities 3,162 (70)
Financing activities - (11)
c) Pyramid Fire Protection Limited
On 28 February 2014 the Group sold 100% of its shares in Pyramid Fire Protection Limited to FCF plc for total consideration of GBP0.4m cash.
The net assets and liabilities at the date of disposal were as follows:
28 February
2014
GBP000
Intangible assets 550
Property, plant and equipment 102
Trade and other receivables 271
Cash and cash equivalents -
Trade and other payables (127)
Deferred tax liability (190)
Net asset disposed 606
Cash Consideration 435
Disposal costs (17)
Loss on disposal (188)
3 DISCONTINUED OPERATIONS (CONTINUED)
c) Pyramid Fire Protection Limited
The results prior to the disposal on 28 February 2014 for Pyramid Fire Protection Limited included in the consolidated income statement were:
31 March 31 March
2014 2013
GBP000 GBP000
Revenue 807 1,161
Operating loss (80) 433
Interest - (1)
--------- ---------
(Loss)/profit before taxation (80) 432
Taxation - -
Loss on disposal of discontinued operations (188) -
(Loss)/profit after tax from discontinued operations (268) 432
--------- ---------
Pyramid Fire Protection contributed the following to the Group's cashflows to 28 February 2014:
31 March 31 March
2014 2013
GBP000 GBP000
Operating cashflows (129) 523
Investing activities 47 (350)
Financing activities (90) (10)
4 EARNINGS PER SHARE
A normalised EPS is disclosed in order to show performance undistorted by amortisation of intangibles, share based payments and non-recurring exceptional operating items. The loss per share before and after adjustments for basic and diluted is as follows:
2014 2013
Re-stated
GBP000 GBP000
Attributable to the owners of the Company
- Continuing activities 864 (3,035)
- Discontinued activities (1,402) (8,937)
--------------------------------------------------------- ----------- ----------
Loss used for continuing and discontinued EPS (538) (11,972)
Normalised EPS
- Profit (Loss) on continuing activities before taxation 864 (4,785)
- Amortisation of intangible assets 450 3,430
- Exceptional items (see note 3) (3,154) 44
--------------------------------------------------------- ----------- ----------
Normalised tax credit 423 315
--------------------------------------------------------- ----------- ----------
Normalised loss for the year (1,417) (996)
--------------------------------------------------------- ----------- ----------
Weighted Average number of shares 339,681,061 92,425,381
--------------------------------------------------------- ----------- ----------
Earnings/(loss) per share (basic and diluted)
- On continuing activities 0.25 (3.28)
- On discontinued activities (0.41) (9.67)
- On all activities (0.16) (12.95)
Normalised loss per share (basic) (0.42) (1.08)
5 PUBLICATION OF NON-STATUTORY ACCOUNTS
The financial information set out in this preliminary announcement does not constitute statutory accounts as defined in section 434 of the Companies Act 2006.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR EAEXEDEXLEFF
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