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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Neville Porter | LSE:NEV | London | Ordinary Share | GB00B1KKFP62 | ORD 0.0444P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 0.10 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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NEVILLE PORTER PLC
Half Yearly report for the six months ended 31 December 2007
31 March 2008
Neville Porter plc ("Neville Porter" or "the Company"), the on-course bookmaker
and off-course betting call centre and internet portal, announces its unaudited
interim results for the six months ended 31 December 2007.
The Company started trading in October 2006 so it is not possible to show
comparable information for the same six month period of 2006. However, unaudited
results for the period 1 December 2006 to 31 December 2006 are included.
SUMMARY
o Attended 97 race meetings in the period
o Average number of bets 940 per meeting, with average bet size of £38
o Average number of call centre and internet bets of 1,600 per week
o New call centre and internet registrations averaging 40 per week
o Turnover of £6.53 million with gross profit of £213,000
o Losses before tax of £268,000
o Net assets of £431,000
Post-period events
o Interest-free £80,000 loan received from Brian Morton
o £350,000 of additional working capital raised by way of a sale and
leaseback of UK pitches to Mr Porter, but will continue to trade from them on
the company's behalf
o New strategic initiatives implemented in January 2008 including a return to
core betting markets - directors continue to monitor progress
The outlook for the second half and future trading periods looks challenging. We
will continue to implement measures to bring stability to our Company but at
present it is difficult to see any short-term improvement ahead.
Neville Porter, Chief Executive, said:
"The admission to AIM in February 2007 increased the profile of the business and
gave us the opportunity to acquire pitches in Ireland and set up a call centre
and internet operation in County Durham.
Conditions since then have been difficult, and although we have achieved
improved turnover levels, we have faced severe pressure on margins and this has
resulted in losses before tax of £268,756.
Nonetheless, the dedication of our staff has been invaluable, and we face the
future with renewed determination in the face of tough trading conditions."
For further information please visit www.nevilleporter.plc.uk or contact:
COMPANY
Neville Porter plc
David Soley, Chairman 08000 223388
NOMINATED ADVISER
Blomfield Corporate Finance Limited
Nick Harriss 020 7512 0191
BROKER
SVS Securities plc
Peter Manfield/Richard Morrison 020 7538 5600
CHAIRMAN'S STATEMENT
I report on the first set of six-month interim accounts since our flotation on
AIM in February 2007. The comparative figures are from incorporation in October
2006 to our first-ever year end, 30 June 2007.
The figures cover the period 1 July 2007 to 31 December 2007, during which
trading at our call centre and on the internet was particularly difficult.
Despite encouraging turnover levels, we struggled with margins due to payouts to
customers at well above budgeted levels.
For on-course betting - where the Neville Porter name has strong brand identity
and a loyal following built up over many years - we were present at 97 race days
in the period.
Subsequent to the half-year end, we undertook a refinancing whereby Brian
Morton, an executive director and significant shareholder, lent £80,000 to the
group on interest-free terms. The loan is secured on the Irish pitches, which we
are advised have retained their value despite issues over pitches in England and
throughout mainland UK.
In January 2008, the Company took measures to reduce its cost base by reducing
headcount at its call centre and to improve profitability by only accepting odds
on its core markets (horse racing, football and greyhound racing) as opposed to
the more diverse range of bets that it has accepted in the past. The Directors
continue to closely monitor the outcome of these changes and will keep
shareholders informed.
Shareholders will be aware that there are serious doubts on the future of the
pitch system in the UK. This led us to write down the value of the UK pitches
by 60% as at 30 June 2007 and to amortise the remaining value equally over four
years. This remains a significant worry to the Company, and combined with
resultant cashflow difficulties meant that we urgently needed to find a way of
stabilising the Company in the short term and improving our long-term prospects.
As a result, we concluded the refinancing which was announced on 30 January
2008, whereby Mr Neville Porter entered into a sale and leaseback of the UK,
raising £350,000 of additional working capital for Group.
Full details of the refinancing were included in the circular to shareholders
dated 27 February 2008 and the resolutions to approve the proposals were passed
by independent shareholders at the extraordinary general meeting held on Monday
17 March.
DAVID SOLEY
Chairman
31 March 2008
CONSOLIDATED INCOME STATEMENT
6 months Period from One month
ended 31 27 October ended 31
December 2006 to 30 December
2007 June 2007 2006
Unaudited Audited Unaudited
Note £ £ £
Revenue 3 6,529,835 6,672,805 298,933
Cost of sales (6,316,321) (6,624,980) (255,459)
_________ _________ _________
Gross profit 213,514 47,825 43,474
Administrative expenses (481,185) (961,029) (29,082)
Other income - 300 -
_________ _________ _________
Operating (loss)/profit (267,671) (912,904) 14,392
_________ _________ _________
Financial income 1,074 367 -
Financial expense (2,159) (217) -
_________ _________ _________
Net financial (expense)/income (1,085) 150 -
_________ _________ _________
(Loss)/profit before tax (268,756) (912,754) 14,392
Taxation - - (2,734)
_________ _________ _________
(Loss)/profit for the period (268,756) (912,754) 11,658
attributable to equity holders
_________ _________ _________
Basic (loss)/earnings per share 4 (0.156)p (0.712)p 0.104p
_________ _________ _________
All amounts relate to continuing operations.
CONSOLIDATED BALANCE SHEET
Note 31 30 31
December June December
2007 2007 2006
Unaudited Audited Unaudited
£ £ £
Non-current assets
Intangible assets:
Goodwill 5 37,950 37,950 -
Betting pitches 6 787,157 768,027 1,142,950
Tangible assets
Property and equipment 87,833 95,834 11,799
_________ _________ _________
912,940 901,811 1,154,749
_________ _________ _________
Current assets
Trade and other receivables 69,085 120,953 -
Cash and cash equivalents 7 67,919 202,401 35,931
_________ _________ _________
137,004 323,354 -
_________ _________ _________
Total assets 1,049,944 1,225,165 1,190,680
_________ _________ _________
Equity and liabilities
Equity attributable to ordinary
shareholders
Share capital 76,714 76,714 50,000
Share premium 1,536,163 1,536,163 945,000
Retained earnings (1,181,510) (912,754) 11,658
_________ _________ _________
Total equity 431,367 700,123 1,006,658
_________ _________ _________
Current liabilities
Trade and other payables 531,341 459,744 184,022
Bank overdraft 7 87,236 65,298 -
_________ _________ _________
618,577 525,042 -
_________ _________ _________
Total equity and liabilities 1,049,944 1,225,165 1,190,680
_________ _________ _________
CONSOLIDATED CASH FLOW STATEMENT
6 months Period from Period from
ended 31 27 October 1 December to
December 2006 to 30 31 December
2007 June 2007 2006
unaudited audited unaudited
£ £ £
Cash flows from operating activities
(Profit)/loss before tax (268,756) (912,754) 14,392
Adjustments for:
Depreciation, amortisation and 33,258 563,335 251
impairment
Interest paid 2,159 217 -
Interest received (1,074) (367) -
_________ __________ _________
Cash flows from operating activities (234,413) (349,569) 14,643
before changes in working capital and
provisions
Decrease/(increase) in trade and other 51,868 (120,953) 21,288
receivables
Increase in trade and other payables 71,597 459,744 -
_________ _________ _________
Cash absorbed by operating activities (110,948) (10,778) 35,931
_________ _________ _________
Cash flows from investing activities
Investment in intangible assets (38,300) (375,067) -
Investment in plant and equipment (6,087) (95,079) (160,000)
_________ _________ ________
Net absorbed by investing activities (44,387) (470,146) -
_________ _________ ________
Cash flows from financing activities
Proceeds from the issue of share - 617,877 -
capital
Loans from directors - - 160,000
Interest paid (2,159) (217) -
Interest received 1,074 367 -
_________ _________ ________
Net cash from financing activities (1,085) 618,027 -
_________ _________ ________
Net increase in cash and cash (156,420) 137,103 -
equivalents
At start of period 137,103 - -
_________ _________ ________
Cash and cash equivalents at end of 7 (19,317) 137,103 35,931
period _________ _________ ________
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
For the six months ended 31 December 2007
Share Share Retained Total
Capital Premium Earnings Equity
Unaudited Unaudited Unaudited Unaudited
£ £ £ £
Balance at 27 October 2006 - - - -
Loss after tax for the period - - (912,754) (912,754)
_________ _________ _________ _________
Total recognised in income and expense - - (912,754) (912,754)
Issue of equity shares 76,714 1,790,797 - 1,867,511
Share issue expenses - (254,634) - (254,634)
_________ _________ _________ _________
Balance at 30 June 2007 76,714 1,536,163 (912,754) 700,123
_________ _________ _________ _________
Balance at 1 July 2007 76,714 1,536,163 (912,754) 700,123
Loss after tax for the period - - (268,756) (268,756)
Total recognised in income and
expense for the period (268,756) (268,756)
_________ _________ _________ _________
Balance at 31 December 2007 76,714 1,536,163 (1,181,510) 431,367
_________ _________ _________ _________
Share capital is the amount subscribed for shares at nominal value.
Share premium represents the excess of the amount subscribed for share capital over the nominal value of these shares
net of share issue expenses.
Retained earnings represent the cumulative loss of the Group attributable to equity shareholders.
NOTES
1 Corporate information
Neville Porter Plc (the Company) and its subsidiaries (together "the Group") offer bookmaking services at various
racecourses throughout the United Kingdom and the Republic of Ireland and via telephone and the internet from its call
centre in County Durham.
The Company is a public limited company quoted on the Alternative Investment Market of the London Stock Exchange, and
resident in England and Wales. The address of its registered office is 8 Pepper Street, London, E14 9RP.
2 Basis of preparation and accounting policies
These interim financial statements of the Company and its subsidiaries ("the Group") for the six months ended 31
December 2007 have been prepared on a basis consistent with the accounting policies set out in the Group's consolidated
annual financial statements for the period ended 30 June 2007. They have not been audited, do not include all of the
information required for full annual financial statements, and should be read in conjunction with the Group's
consolidated annual financial statements for the period ended 30 June 2007. The auditors' report on those consolidated
financial statements was unqualified and did not include references to any matters to which the auditors drew attention
by way of emphasis without qualifying their report. As permitted, the Company has chosen not to adopt IAS34 `Interim
Financial Reporting'.
The comparative figures presented are for the period ended 30 June 2007. The Group's consolidated annual financial
statements for the period ended 30 June 2007 were prepared using the recognition and measurement principles of
International Financial Reporting Standards (IFRSs and IFRIC interpretations) as adopted by the European Union and also
in accordance with the Companies Act 1985.
Significant accounting policies
(a) Consolidation
Subsidiaries are all entities over which the Group has the power to govern the financial and operating policies
generally accompanying a shareholding of more than one half of the voting rights. The existence and effect of potential
voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls
another entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are
de-consolidated from the date that control ceases.
The Group uses the purchase method of accounting to account for the acquisition of subsidiaries. The cost of an
acquisition is measured as the fair value of the assets given, equity instruments issued and liabilities incurred or
assumed at the date of exchange plus costs directly attributable to the acquisition. Identifiable assets acquired and
liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at
the acquisition date, irrespective of the extent of the minority interest. The excess of the cost of acquisition over
the fair value of the Group's share of identifiable assets is recorded as goodwill. If the cost of acquisition is less
than the fair value of the net assets of the subsidiary acquired, the difference is recognised directly in the income
statement.
Inter-company transactions, balances and unrealised gains on transactions between Group companies are eliminated.
Unrealised losses are also eliminated but considered an impairment indicator of the asset transferred. Accounting
policies of subsidiaries have been changed (where necessary) to ensure consistency with the policies adopted by the
Group.
(b) Segment reporting
A business segment is a group of assets and operations engaged in providing products or services that are subject to
risks and returns that are different from those of other business segments. A geographical segment is engaged in
providing products or services within a particular economic environment that are subject to risks and return that are
different from those segments operating in other economic environments.
(c) Foreign currency translation
(i) Functional and presentation currency
Items included in the financial statements of each of the Group's entities are measured using the currency of the
primary economic environment in which the entity operates (the functional currency). The consolidated financial
statements are presented in Pounds Sterling (£), which is the Company's functional and presentation currency.
(ii) Transactions and balances
Foreign currency transactions are translated into the functional currency using exchange rates prevailing at the dates
of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the
translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are
recognised in the income statement.
(d) Intangible assets
Intangible assets acquired separately are capitalised at cost and those acquired as part of a business combination are
capitalised separately from goodwill if the fair value can be measured reliably on initial recognition. The costs
relating to internally generated intangible assets are capitalised if the criteria for recognition as assets are met.
Other expenditure is charged against profit in the year in which the expenditure is incurred. Following initial
recognition, intangible assets are carried at cost less any accumulated amortisation and any accumulated impairment
losses. The useful lives of these intangible assets are assessed to be either finite or indefinite. Where amortisation
is charged on assets with finite lives, this expense is taken to the income statement. Useful lives are also reviewed on
an annual basis.
Intangible assets with indefinite lives are tested for impairment annually, either on an individual or cash generating
unit level. The pitches and goodwill are considered to have indefinite durability that can be demonstrated and their
value can be readily measured. The business operates in a longstanding and profitable market sector, which continues to
grow. The directors consider that there are sufficient barriers to entry, such as lack of availability of pitches to new
entrants and the requirement to obtain a betting licence, to sustain the value of intangible assets. The income stream
from each pitch and each business acquisition is separately recorded; hence each asset can be valued on a discounted
cash flow basis.
(e) Taxation
Tax on the profit or loss comprises current and deferred tax. Tax is recognised in the income statement except to the
extent that it relates to items recognised directly in equity, in which case it is recognised in equity.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively
enacted at the balance sheet date together with any adjustment to tax payable in respect of previous years.
(f) Revenue recognition
Revenue is the consideration received or receivable from customers for bets placed in the normal course of business less
any amounts arising in respect of open betting positions.
(g) Going concern
The unaudited consolidated financial statements have been prepared on a going concern basis. Refer to note 8.
3 Segmental analysis
The Group operates in two areas of operation: on-course betting and call-centre (telephone and internet) betting.
On-course operations are undertaken in the United Kingdom and in the Republic of Ireland. The call-centre is based in
the United Kingdom.
Segmental analysis for the six month period ended 31 December 2007 by principal area of operation:
On-course Call-centre
Operations Operations Unallocated Total
Unaudited Unaudited Unaudited Unaudited
£ £ £ £
Turnover 3,493,205 3,036,630 - 6,529,835
__________________________________________________
Operating loss 10,645 (185,679) (92,637) (267,671)
4 Loss per share
The calculation of the basic loss per share is based upon the net loss after tax attributable to ordinary shareholders
of £268,756 (period ended 30 June 2007: loss of £912,754) and a weighted average number of shares in issue for the
period of 172,779,284 (30 June 2007: 128,141,310).
5 Intangible assets
31 December
2007
Goodwill Unaudited
£
Balance at 26 October 2006 -
Acquired in period 37,950
________
Balance at 30 June 2007 37,950
Acquired in period -
Impairment in period -
________
Balance at 31 December 2007 37,950
________
6 Betting pitches
31 December
2007
Unaudited
£
Balance at 26 October 2006 -
Acquired in period - business combination 945,000
Acquired in the period - other 435,067
Amortisation in the period (36,000)
Impairment charges in the period (552,040)
Disposals in the period (24,000)
_________
Balance at 30 June 2007 768,027
Acquired in period 38,300
Amortisation in the period (19,170)
_________
Balance at 31 December 2007 787,157
_________
7 Cash and cash equivalents
31 December 30 June
2007 2007
Unaudited Audited
£ £
Cash at bank 67,919 202,401
Bank overdraft (87,236) (65,298)
________ ________
(19,317) 137,103
________ ________
Included in the above is £148,429 (30 June 2007: £269,932) in respect of client funds held representing deposits
received and customer winnings. These funds are offset by an equivalent amount shown in trade and other payables.
8 Publication of non-statutory accounts
The financial information contained in this interim statement does not constitute accounts as defined by section 240 of
the Companies Act 1985. The financial information for the preceding period is based on the statutory accounts for the
financial period ended 30 June 2007. These accounts, on which the auditors issued an unqualified opinion, have been
delivered to the Registrar of Companies.
Copies of the interim statement may be obtained from the Company Secretary, Neville Porter plc, 8 Pepper Street, London
E14 9RP and can be accessed from the Company's website at www.nevilleporter.plc.uk.
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