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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Nipson Dig. | LSE:NDP | London | Ordinary Share | GB00B01QLJ25 | 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% | 1.625 | 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 : 6365T
Nipson Digital Printing Systems PLC
09 June 2009
For immediate release 9 June 2009
NIPSON DIGITAL PRINTING SYSTEMS PLC ("Nipson" or "the Company")
ANNUAL REPORT AND ACCOUNTS 2008
The Annual Report and Accounts 2008 have been posted to Shareholders, and are
available, together with a copy of this announcement, on the Company's website
www.nipson.com ("Investors - AIM Rule 26") and from the Company's offices.
CHAIRMAN'S STATEMENT
Overview
The Board has announced on a number of occasions in different communications and
trading updates the effect the worldwide economic crisis is having on the
Company's results. These external factors have affected equipment sales and this
especially in the fourth quarter of 2008, which coupled with the effect of a
declining dollar reduced revenue as well as margin. However, due mainly to
currency changes, reported revenue for the twelve months of 2008 remained stable
at GBP27.3m (2007: GBP27.3m). With the movement of the GB Pound from an average
to the Euro of GBP0.68433 to 1EUR in 2007 to an average of GBP0.79654 to 1EUR in
2008 (a drop of approximately 15%), the effect is to give an inflated impression
of the Group's revenues such that after currency adjustments revenues in 2008
were in fact more than 15% lower than in 2007. We remind shareholders that 2007
was already a difficult year for the Company.
Total revenues into the Americas in 2008 in local currency increased by 7%, but
due to the depreciation of the GB Pound against the US Dollar, the reported
increase is 17% rising to GBP8.8m (2007: GBP7.5m). All other markets showed a
decline in revenues mainly due to lower equipment sales and a generalised dip in
recurrent revenues in the fourth quarter.
Equipment revenues were down by 16.8% ending at GBP6.8m for the year (2007:
GBP8.1m), whereas equipment revenues in Euros, the principal trading currency of
the Group, dropped by more than 27%. Recurrent revenues for 2008 were 7% higher
at GBP20.5m (2007: GBP19.2m), but this hides a drop of nearly 10% in
Euros. Lower equipment sales in the last quarter led to a significant fall in
revenues. Worldwide, the recent economic climate has lead to a reduction in
equipment sales as existing and potential customers delay investment decisions
either due to lack of appropriate finance or due to lack of significant vision
concerning future demand. The economic climate has also led to a reduction in
general volumes of printed matter, such that sales by the Group both to
distributors and direct customers alike of consumables and other activity
related recurrent revenues have fallen.
Change in Control
Whilst the Group had shown some improvement in sales in the first half of the
year compared to 2007, cash had been tight and the working capital requirement
was beyond the levels agreed with the Group's bankers and the major shareholder,
the Polar Group. In the light of the financial position of Nipson SAS and taking
into account the severe market conditions which made it extremely difficult for
businesses to raise any new equity or debt finance from external sources, the
Board considered alternatives to avoid an insolvent liquidation of the Group.
As such, on the 14 October 2008 and as announced on the same day (the
announcement in full detail can be seen in the Investors AIM RULE 26 section of
the Nipson website), Polar Communications Ltd ("Polar") and Polar's affiliate,
Koonras BV BVBA, ("Koonras" and together with Polar, the "Polar Group"), the
then majority shareholder of Nipson Digital Printing Systems Plc ("Nipson" or
the "Company") entered into an agreement with Creacorp NV, a Belgian
incorporated company ("Creacorp"), whereby Polar Group agreed:
* To assign for 1EUR the benefit of loans and accrued interest value of
approximately EUR14.7 million owed to it by Nipson and its subsidiaries, to
Creacorp (the "Loan Assignments"),
* To grant Creacorp a call option to acquire for 1EUR up to 22,992,709 ordinary
shares held by the Polar Group in the capital of Nipson representing 43.96% of
the issued and outstanding ordinary shares, subject to the Polar Group
maintaining an interest of 10% of the issued share capital of Nipson for 3 years
at the time the call option is exercised, less any shares sold by Polar before
such exercise;
* with Nipson's consent to transfer to Creacorp EUR564,500 in nominal value of 5%
unsecured convertible loan notes issued by Nipson to Polar on 12 May 2008, in
accordance with an agreement dated 30 January 2008 (the "Loan Notes").
Furthermore, Nipson also agreed (on more favourable terms to the Company) to an
amendment to the terms of the remaining EUR2,200,000 in nominal value of the Loan
Notes held by Polar following such transfer, such that the loan became interest
free and repayable over a period of five years starting in October 2009 but
without any conversion right by either party to capitalise the debt into
Ordinary Shares.
In connection with the above call option, Polar agreed to vote the Ordinary
Shares in accordance with the instructions of Creacorp. The call option has
been taken-up by Creacorp, but at the time of approval of these accounts the
option was not fully executed. Creacorp also agreed to acquire Polar's
remaining shareholding, subject to certain conditions.
As explained in the announcement to shareholders made last year on the 6
February 2008, the Company continued to work with Polar for some time to secure
additional sources of financing for the business. These efforts included
discussions with banks within and outside France and negotiations with a number
of funds and investment institutions and included discussions with industry
partners and competitors. No other concrete proposals were made to the Company
committing to potential funding of the Company's operations other than Creacorp
and since the proposition made to shareholders and carried at the EGM of 29
February 2008 (and mentioned as a post balance sheet event in the 2007 Annual
Report & Accounts), until the said agreement made between Polar and Creacorp of
the 14 October 2008. The Board considered other alternatives, but concluded
that the transaction as set-out in the announcement represented the only
realistic way of avoiding an insolvent liquidation of the Group. The Board took
into account that to facilitate the transaction Polar agreed to pay the sum of
EUR2,200,000 to Bank Hapoalim to clear the debt owed to Bank Hapoalim by Nipson
SAS, the main French trading subsidiary of the Company. As mentioned above, an
equivalent value of this debt, due to Hapoalim and paid-off by Polar, was
retained as being owed to Polar by the Company but at revised terms more
favourable to the Company. Other than this amount, Polar agreed to give up the
remainder of its debt and equity interests in the Group to Creacorp for a
nominal consideration.
Takeover Code
Although the Company is incorporated in England, the place of central management
of the Company is currently located outside of the UK, the Channel Islands and
the Isle of Man because the main place of business is in France. Accordingly,
the Company is one to which paragraph 3(a)(ii) of the Takeover Code does not
apply, and the Panel has confirmed that the Company is not subject to the
Takeover Code and shareholders will not be afforded any protection under the
Code.
Information on Creacorp
Creacorp is a private Belgian company controlled by the Belgian Dumarey family.
The Directors of Creacorp are Guido Dumarey and Brigitte Dumolijn. Creacorp
holds a diversified portfolio of technology, property and entertainment
companies. It has been involved in a number of successful restructurings in the
graphics, automotive and entertainment business. At the end of 2007, Creacorp
held assets of more than 100mEUR. Creacorp holds a 31% shareholding in the
Euronext (Brussels) listed conglomerate, Punch International NV ("Punch"), of
which Guido Dumarey is Executive Chairman. Punch International NV owns
automotive, telematics and property business activities and is a major
manufacturer of printing equipment. Punch last reported profits on ordinary
activities before taxation of 28.5mEUR on sales turnover of 331.7mEUR and assets of
315mEUR.
Guillaume Dumarey, Marc Maes and Ghislain Segard, all of whom are affiliated to
Creacorp, were appointed as Directors of Nipson with effect from 14 October
2008. Collectively, the new Directors have held responsibilities in reorganising
companies in industries as diverse as automotive, electronics, dairy equipment,
entertainment and others.
Restructuring of the Group's Operations
Nipson SAS, as the Group's main operating subsidiary based in France,
experienced difficulties in meeting its obligations in respect of on-time
payments which was aggravated by continuing losses in the business due to lower
production volumes and inflationary pressure from various raw material price
increases. The difficult financial situation of Nipson SAS led to the withdrawal
of credit insurance by a number of providers of insurance and rating services in
the second half of the year which, cumulated with the financial market's
generally tighter credit restrictions over the last 4 months of the year, led to
reduced flexibility in the day to day operating of its working capital. The
economic crisis caused delayed customer payments especially from countries where
capital was not so free flowing and also reduced the possibility of obtaining
fresh funding from other sources.
As indicated above, the Board made an announcement on 14 October 2008 relating
to a change in control and a proposed financial restructuring of the Group and
board changes. The first task of the new directors was to evaluate and assess
the operational and financial situation of the Group and make recommendations to
the Board which would lead to appropriate actions and procedures to be
considered.The new Board evaluated and assessed the operational and financial
situation of the group and as a result of this assessment concluded that the
French Subsidiary required urgent restructuring; both at the operations level,
including subcontracting out the non-core part of its production, and at the
economic level by reducing fixed costs and operating expenses.
The Board decided unanimously to confer to the newly appointed President of
Nipson SAS, Mr. Ghislain Segard, all powers to carry through the necessary
changes including filing for the French "Redressement Judiciaire" which was
filed for on 27 October 2008. Following the filing for Redressement Judiciaire,
the French Commercial Courts nominated an administrator who has been and is
still supervising the President in the process of the restructuring. The
restructuring plan also included a sizeable reduction of more than 40% in the
number of employees. The administrator also has and is supervising the payment
of creditors, thus protecting the company during the period of restructuring.
The government insurance scheme has allowed the company an additional delay in
paying redundancy payments, certain salaries and related social charges.
On 7 April 2009, Nipson announced that the reorganisation plan would necessitate
the forgiveness/conversion of debt and that this was likely to be a Related
Party Transaction under the AIM Rules. In the meantime a reorganization plan
was negotiated between Ghislain Segard and the administrator, and was formally
presented to the French Commercial Courts on 21 April 2009.
On 14 May 2009 the Board agreed a restructuring plan with Creacorp, which the
French Court has presented to the creditors of Nipson SAS. Accordingly, Nipson
anticipates that the Redressement Judiciaire procedure relating to Nipson SAS
could be concluded within the timetable set by the Court, being at or shortly
after the next scheduled meeting with the French Court on 23 June 2009, and that
the Group could thereafter be able to resume its operations under the full
control of the Board.
As part of the reorganisation, the French Court has required additional
financial commitments from Creacorp to Nipson SAS. Creacorp has committed to
provide funds as highlighted in the below notes (see: Post Balance Sheet Events
& Going Concern).
Parallel to the restructuring of the French operations the other Group companies
were also reorganised. Reductions were made in the number of employees as well
as in the fixed costs and operating expenses in the Nipson subsidiaries based in
the UK and in the US. The Italian subsidiary is in the process of voluntary
winding-up and the Singapore and Belgium branches of the Group are in the
process of being closed.
Results
Gross profit for the full year to 31 December 2008 was GBP2.9m (2007: GBP3.5m),
a reduction of 17% mainly due to the lower volumes of equipment manufactured and
sold. Gross margins decreased to 10.5% (2007: 12.7%) due to the lower machine
production levels, the pressure on prices and hence margins from the US Dollar
to Euro rate and the incremental costs required to implement the new
technology. In 2008 some of the technical issues from 2007 continued to provoke
specific production difficulties which were in the main resolved but at
extensive additional costs than expected.
The operating loss for 2008 was GBP13.4m (2007: loss of GBP4.7m). The loss
before tax in 2008 was GBP14.7m (2007: GBP6.2m). The operating loss and the
loss before tax for 2008 are both after charging exceptional costs totalling
GBP7.1m. These exceptional costs cover the Social Plan (4mEUR), the restructuring
of the Group and certain additional provisions related mainly to the reduction
in activity. The operating loss and the loss before tax for 2007 include the
book loss on the sale of Land & Buildings of GBP0.5m.
The losses experienced by the Group from low production volumes, low margins
from the US operations due to the weakness of the Dollar and the restructuring
costs will require the Company to review the value of the subsidiaries in the
Nipson SAS balance sheet. The projected plan for taking Nipson SAS out of
administration will require virtually all debts owed by Nipson SAS both to the
Company and to the controlling shareholder Creacorp (as transferred to Creacorp
following the agreements with the Polar Group), to be either capitalised or
forgiven (see details under Note: Post Balance Sheet Events & Going Concern).
Cash and Working Capital
The year end Euro to GB Pounds conversion rates used by the Group was GBP0.97087
to 1EUR (2007: GBP0.73593 to 1EUR), movement of more than 30%. This change should be
taken into account whilst looking at the balance sheet figures. Cash balances
were GBP2.2m as of 31 December 2008 (2007: GBP1.3m). Year-end stocks decreased
from GBP9.7m to GBP9.3m mainly related to the lower production volume and
call-off from suppliers. Debtors dropped markedly down to GBP6.7m (2007:
GBP9.5m) due essentially to the reduced level of equipment revenues in the last
quarter of 2008 against a high level of activity in December 2007. The
outstanding amounts owed to the company by the French Treasury Department in
last year balance were also settled during 2008.
Early on in the year 2008 new cash of 0.75mEUR was received from the previous
majority shareholder, the Polar Group, and following the announcement on 6
February 2008 and the passing of the necessary resolutions at the General
Meeting of 28 February 2008, the Company issued approximately GBP1.5m of 5%
unsecured convertible loan notes to new investors and issued, in exchange for
the equivalent amount in debt, approximately GBP2.1m of 5% unsecured convertible
loan notes to Nipson's major shareholder, Polar Communications (the remaining
amount of the Polar loans and accruing interest following this issue was
11.9mEUR). Further to these arrangements the Company issued 1,255,234 warrants to
D. Roseman as broker to the issue.
Despite these new funds, the cash situation of the Company became too tight as
indicated above (under the section entitled Restructuring of the Group's
Operations).
Research & Development Projects
During 2008 GBP3.0m was spent on R&D (2007: GBP3.0m). The projects covered
mainly finalising the development of the new generation writing heads,
technological advances related to developing higher speed print engines and new
developments for the Nipson Spot Colour machine. A number of new features to
the VaryPress range were presented by Nipson in June 2008 at the DRUPA
International printing industry exposition which is held every 4 years. R&D
expenses totalling GBP1.1m net were capitalised during 2008 (2007: GBP1.2m net).
These intangible R&D assets are amortised over 4 to 6 years. An additional
amortisation of GBP0.5m related to all capitalised projects from 2006, 2007 and
2008 was charged to the accounts in 2008. In 2009, the Group expects to continue
a relatively high level of expenditure on R&D, this being essential to the
Group's strategic development and growth.
Prospects
The reorganisation of the production facilities, including the transfer of the
machine assembly to a specialised plant in Germany, has enabled the cost
structure of the French facilities to be drastically reduced. The restructuring
of the Group by eliminating fixed overhead charges in all the subsidiaries will
improve operating results.
In 2006 Nipson won a major contract with the French Government's Treasury
Department (Direction Générale de la Comptabilite Publique or DGCP). Following
the successful installation of the first production line delivered in December
2006, a second line was installed towards the end of 2007. The third line was
delayed, but is now planned for delivery in 2009.
Despite the ongoing restructuring of the Group, the worldwide economic crisis
has had an effect on prospects in the immediate future. The reductions in orders
for new machines and the reduction in customer's printed volumes thus affecting
recurrent revenues has reduced the probability of the Group successfully coming
out of its difficult economic situation which therefore cannot be guaranteed by
any means.
Buyback arrangement for outside shareholders
In order to provide some certainty for the shareholders of the Company, Creacorp
NV has agreed to make an offer to acquire all of the actually existing
pre-dilution shares, excluding any such shares not in public hands under the AIM
Rules as at 1 April 2009 (i.e. excluding any shares held by Creacorp or over
which Creacorp holds the voting rights, or held by any director of the Company).
Also to be excluded are any shares that will be created in future capital
increases or conversion transactions. The purchase price will be 1.25 pence per
share subject to the fact that the Company or Nipson SAS will not go bankrupt,
to be purchased at the date of 18 months after the AGM for which Notice is
hereby given for 11:00 a.m. on 30 June 2008.
For further information, please contact:
Nipson Digital Printing Systems PLC
Marc Maes, ChairmanTel: +32 (0)494 500 423
Robert Cahill, Director Tel: +33 (0)384 54 52 50
Beaumont & Cornish Ltd (Nomad):
Roland Cornish Tel: +44 (0)20 7628 3396
Rosalind Hill Abrahams
NIPSON DIGITAL PRINTING SYSTEMS PLC
Audited Results for the Year Ended 31 December 2008
+---------------------------------------------+------------+------------+
| CONSOLIDATED INCOME STATEMENT | 2008 | 2007 |
| | GBP'000 | GBP'000 |
| | | |
+---------------------------------------------+------------+------------+
| Continuing Operations | | |
+---------------------------------------------+------------+------------+
| Revenue | 27,312 | 27,335 |
+---------------------------------------------+------------+------------+
| Cost of Sales | (24,443) | (23,872) |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
| Gross Profit | 2,869 | 3,463 |
+---------------------------------------------+------------+------------+
| Operating Expenses | (9,100) | (7,667) |
+---------------------------------------------+------------+------------+
| Other Operating Expenses | (7,140) | (453) |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
| Loss on Continuing Operations before | (13,371) | (4,657) |
| interest | | |
+---------------------------------------------+------------+------------+
| Finance Income | 470 | 191 |
| Finance Costs | (3,009) | (1,743) |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
| Loss from Continuing Operations before | (15,910) | (6,209) |
| taxation | | |
+---------------------------------------------+------------+------------+
| Taxation | - | - |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
| Loss from Continuing Operations after | (15,910) | (6,209) |
| taxation | | |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
| Loss per Ordinary Share (Basic and Diluted) | (30.4p) | (11.9p) |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
+---------------------------------------------+------------+------------+
| | 2008 | 2007 |
| | No. of | No. of |
| | Shares | Shares |
+---------------------------------------------+------------+------------+
| Weighted average number of shares | | |
+---------------------------------------------+------------+------------+
| For basic and diluted earnings per share | 52,303,581 | 52,303,581 |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
+---------------------------------------------+------------+------------+
| CONSOLIDATED STATEMENTS OF RECOGNISED | 2008 | 2007 |
| INCOME AND EXPENDITURE | GBP'000 | GBP'000 |
| | | |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
| Exchange Difference on Translation of | (1,494) | 234 |
| Foreign Operations | | |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
| Net (Expense)/Income Recognised Directly in | (1,494) | 234 |
| Equity | | |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
| Loss for the Year | (15,910) | (6,209) |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
| Total Recognised Income and Expense for the | (17,404) | (5,975) |
| Year | | |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
NIPSON DIGITAL PRINTING SYSTEMS PLC
Audited Results for the Year Ended 31 December 2008
+---------------------------------------------+------------+------------+
| CONSOLIDATED BALANCE SHEET | 2008 | 2007 |
| | GBP'000 | GBP'000 |
+---------------------------------------------+------------+------------+
| Assets | | |
+---------------------------------------------+------------+------------+
| Non-Current Assets | | |
+---------------------------------------------+------------+------------+
| Intangible Assets | 5,514 | 4,391 |
+---------------------------------------------+------------+------------+
| Property, Plant & Equipment | 2,988 | 3,645 |
+---------------------------------------------+------------+------------+
| Deferred Tax Asset | 424 | 597 |
+---------------------------------------------+------------+------------+
| Other Non-Current Assets | 239 | 498 |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
| | 9,165 | 9,131 |
+---------------------------------------------+------------+------------+
| Current Assets | | |
+---------------------------------------------+------------+------------+
| Inventories | 9,325 | 9,679 |
+---------------------------------------------+------------+------------+
| Trade and Other Receivables | 7,454 | 9,545 |
+---------------------------------------------+------------+------------+
| Cash and Cash Equivalents | 2,164 | 1,348 |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
| | 18,943 | 20,572 |
+---------------------------------------------+------------+------------+
| Liabilities | | |
+---------------------------------------------+------------+------------+
| Current Liabilities | | |
+---------------------------------------------+------------+------------+
| Trade and Other Payables | (17,233) | (7,696) |
+---------------------------------------------+------------+------------+
| Borrowings | (18,780) | (12,870) |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
| | (36,013) | (20,566) |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
| Net Current (Liabilities)/Assets | (17,070) | 6 |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
| Non-Current Liabilities | | |
+---------------------------------------------+------------+------------+
| Borrowings | (4,145) | (3,776) |
+---------------------------------------------+------------+------------+
| Deferred Tax Liabilities | (424) | (597) |
+---------------------------------------------+------------+------------+
| Retirement Benefit Liability | (689) | (1,016) |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
| | (5,258) | (5,389) |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
| Net (Liabilities)/Assets | (13,163) | 3,748 |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
| Shareholder's (Deficit)/Equity | | |
+---------------------------------------------+------------+------------+
| Ordinary Share Capital | 523 | 523 |
+---------------------------------------------+------------+------------+
| Share Premium | 13,915 | 13,915 |
+---------------------------------------------+------------+------------+
| Equity Portion of Convertible Loans Notes | 493 | - |
+---------------------------------------------+------------+------------+
| Reverse Acquisition Merger Reserve | 3,057 | 3,057 |
+---------------------------------------------+------------+------------+
| Translation Reserve | (1,328) | 166 |
+---------------------------------------------+------------+------------+
| Retained Earnings | (29,823) | (13,913) |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
| Total (Deficit)/Equity Attributable to | (13,163) | 3,748 |
| Equity Holders | | |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
NIPSON DIGITAL PRINTING SYSTEMS PLC
Audited Results for the Year Ended 31 December 2008
+--------------------------------------------+-------------+------------+
| CONSOLIDATED CASH FLOW STATEMENT | 2008 | 2007 |
| | GBP'000 | GBP'000 |
+--------------------------------------------+-------------+------------+
| | | |
+--------------------------------------------+-------------+------------+
| Net Cash Increase/(Decrease) from | 2,179 | (1,444) |
| Operating Activities | | |
+--------------------------------------------+-------------+------------+
| | | |
+--------------------------------------------+-------------+------------+
| Cash Flows from Investing Activities | | |
+--------------------------------------------+-------------+------------+
| Purchase of Intangible Assets | (1,414) | (2,480) |
+--------------------------------------------+-------------+------------+
| Purchase of Property, Plant & Equipment | (63) | (188) |
+--------------------------------------------+-------------+------------+
| Disposal of Non Current Assets | 98 | 2,100 |
+--------------------------------------------+-------------+------------+
| Interest Received | - | 75 |
+--------------------------------------------+-------------+------------+
| | | |
+--------------------------------------------+-------------+------------+
| Net Cash Used in Investing Activities | (1,379) | (493) |
+--------------------------------------------+-------------+------------+
| | | |
+--------------------------------------------+-------------+------------+
| Cash Flows from Financing Activities | | |
+--------------------------------------------+-------------+------------+
| Interest Paid | (409) | (541) |
+--------------------------------------------+-------------+------------+
| Capital Repayments on Finance Leases | (234) | (2,388) |
+--------------------------------------------+-------------+------------+
| Borrowings Raised - from Third Party | 1,562 | 215 |
+--------------------------------------------+-------------+------------+
| - from Related Party Undertakings | 565 | 5,203 |
+--------------------------------------------+-------------+------------+
| Borrowings Repaid | (1,468) | (1,796) |
+--------------------------------------------+-------------+------------+
| | | |
+--------------------------------------------+-------------+------------+
| Net Cash Generated from Financing | 16 | 693 |
| Activities | | |
+--------------------------------------------+-------------+------------+
| | | |
+--------------------------------------------+-------------+------------+
| | | |
+--------------------------------------------+-------------+------------+
| Net Increase/(Decrease) in Cash & Cash | 816 | (1,244) |
| Equivalents | | |
+--------------------------------------------+-------------+------------+
| Cash & Cash Equivalents at 1 January | 1,348 | 2,592 |
+--------------------------------------------+-------------+------------+
| | | |
+--------------------------------------------+-------------+------------+
| Cash & Cash Equivalents at 31 December | 2,164 | 1,348 |
+--------------------------------------------+-------------+------------+
| | | |
+--------------------------------------------+-------------+------------+
| | | |
+--------------------------------------------+-------------+------------+
+---------------------------------------------+------------+------------+
| CASH FLOWS DETAILS | 2008 | 2007 |
| | GBP'000 | GBP'000 |
+---------------------------------------------+------------+------------+
| Continuing Operations | | |
+---------------------------------------------+------------+------------+
| Loss before Taxation | (15,910) | (6,209) |
+---------------------------------------------+------------+------------+
| Adjustments for : | | |
+---------------------------------------------+------------+------------+
| Depreciation and Amortisation | 2,330 | 1,618 |
+---------------------------------------------+------------+------------+
| Disposal of Non Current Assets | - | 542 |
+---------------------------------------------+------------+------------+
| Finance Income | (470) | (191) |
+---------------------------------------------+------------+------------+
| Finance Expense | 3,009 | 1,743 |
+---------------------------------------------+------------+------------+
| Increase in Retirement Benefit Obligation | 134 | 97 |
+---------------------------------------------+------------+------------+
| Share Based Payment Charge | - | - |
+---------------------------------------------+------------+------------+
| Changes in Working Capital | | |
+---------------------------------------------+------------+------------+
| Decrease/(Increase) in Inventories | 518 | (874) |
+---------------------------------------------+------------+------------+
| Decrease in Trade & Other Receivables | 4,519 | 576 |
+---------------------------------------------+------------+------------+
| (Decrease)/Increase in Payables | (175) | 976 |
+---------------------------------------------+------------+------------+
| Increase in provisions | 8,224 | 278 |
+---------------------------------------------+------------+------------+
| Cash Generated from/(Used in) Continuing | 2,179 | (1,444) |
| Operations | | |
+---------------------------------------------+------------+------------+
| Corporation Tax Paid | - | - |
+---------------------------------------------+------------+------------+
| Net Cash Increase/(Decrease) from | 2,179 | (1,444) |
| Continuing Operations | | |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
NIPSON DIGITAL PRINTING SYSTEMS PLC
Audited Results for the Year Ended 31 December 2008
Notes
These notes are only an extract of the full notes to the 2008 Annual Report &
Accounts. It is therefore, recommended to view or download the full Report &
Accounts available in .pdf form at Nipson's website:
http://www.nipson.com/investors/rule26.php - under the section "Company Reports.
Going concern
This annual report includes a copy of the notice (see also the end of this
announcement) calling a general meeting to discuss the serious loss of capital
as stipulated by s142 of the 1985 Companies Act. The main operating subsidiary,
Nipson SAS based in France, is still under protective administration at the time
of this announcement. Nevertheless the directors believe that following the
restructuring plan presented to the French Courts on the 21 April 2008 and the
decision of both the Company and Creacorp NV to waive 94% of the debt owed to
them by Nipson SAS capitalising the remaining 6%, and the deed signed between
the Company, Creacorp and Nipson SAS, that Nipson SAS has a high probability of
coming out of the administration process, giving back full control to the Group
and every chance to succeed. However, although this hope cannot be guaranteed in
any way especially in the current worldwide economic climate, the Board has
satisfied itself that the Group has adequate resources to continue in
operational existence for the foreseeable future, and for this reason the
financial statements continue to be prepared on a going concern basis. See the
note below "Post Balance Sheet Events & Going Concern".
The main points underlying this position are covered in the above Chairman's
statement and under the note concerning Post Balance Sheet Events & Going
Concern. Other important announcements are:
- 28 February 2008 an Extraordinary General Meeting was held during which three
resolutions pertaining to the financing of the Group were made and carried.
- 14 October 2008 an announcement was made concerning the change in control of
the Group from Polar to Creacorp.
- 28 October 2008 an announcement was made concerning the filing by Nipson SAS
for protective administration "Redressement Judiciaire".
- 14 May 2009 an announcement was made concerning the financial restructuring of
the Group.
Nature of Financial Information
The financial information contained within this announcement does not constitute
statutory accounts for the year ended 31 December 2008. The financial
information for the year ended 31 December 2007 is derived from the statutory
accounts for that year which has been delivered to the Registrar of Companies.
Audit Opinion and Emphasis
The following is an extract from the audit opinion where the auditors gave their
"opinion" and declaration of "emphasis of matter" regarding "going concern".
Opinion
* the group financial statements give a true and fair view, in accordance with
IFRSs as adopted by the European Union, of the state of affairs of the group as
at 31 December 2008 and of the group's loss for the year then ended;
* the financial statements have been properly prepared in accordance with the
Companies Act 1985; and
* the information given in the Director's Report is consistent with the financial
statements.
Emphasis of matter - Going concern
In forming our opinion on the financial statements, which is not qualified, we
have considered the adequacy of the disclosure made in Note 23 to the
consolidated financial statements (replicated here below under the note "Post
Balance Sheet Events & Going Concern") concerning the Group's ability to
continue as a going concern which is reliant on support of the ultimately
controlling party Creacorp NV. This support, which includes agreements to write
off certain loans and provide further finance, is contingent on successful
completion of the Redressment Judiciaire process for Nipson SAS in France, for
which a decision is not expected until 23 June 2009. These conditions indicate a
material uncertainty which may cast significant doubt about the Group's ability
to continue as a going concern. The consolidated financial statements do not
include the adjustments that would result if the Group was unable to continue as
a going concern.
Glossary: Redressement Judiciaire: the English equivalent might be considered to
be "receivership under protective administration"
NIPSON DIGITAL PRINTING SYSTEMS PLC
Audited Results for the Year Ended 31 December 2008
+---------------+-------------+-------------+---------+----------+----------+----------+
| RESERVES | Reverse |Convertible | Share | Profit | Foreign | Total |
| |Acquisition | Loans |Premium | and |Exchange | GBP'000 |
| | Reserve | Equity |Reserve | loss | Reserve | |
| | GBP'000 |Component # |GBP'000 | account | GBP'000 | |
| | | GBP'000 | | GBP'000 | | |
+---------------+-------------+-------------+---------+----------+----------+----------+
| GROUP | | | | | | |
+---------------+-------------+-------------+---------+----------+----------+----------+
| At 1 January | 3,057 | - | 13,915 | (7,704) | (68) | 9,200 |
| 2007 | | | | | | |
+---------------+-------------+-------------+---------+----------+----------+----------+
| Loss for the | - | - | - | (6,209) | - | (6,209) |
| year | | | | | | |
+---------------+-------------+-------------+---------+----------+----------+----------+
| Foreign | - | - | - | - | 234 | 234 |
| exchange | | | | | | |
| movement | | | | | | |
+---------------+-------------+-------------+---------+----------+----------+----------+
| | | | | | | |
+---------------+-------------+-------------+---------+----------+----------+----------+
| 31 December | 3,057 | - | 13,915 | (13,913) | 166 | 3,225 |
| 2007 | | | | | | |
+---------------+-------------+-------------+---------+----------+----------+----------+
| | | | | | | |
+---------------+-------------+-------------+---------+----------+----------+----------+
| Loss for the | - | - | - | (15,910) | - | (15,910) |
| year | | | | | | |
+---------------+-------------+-------------+---------+----------+----------+----------+
| Equity | | | | | | |
| Component # | | | | | | |
| of | | | | | | |
| Convertible | | | | | | |
| Loans: | | | | | | |
+---------------+-------------+-------------+---------+----------+----------+----------+
| - Issued | - | 913 | - | - | - | 913 |
| - Repaid | - | (420) | - | - | - | (420) |
+---------------+-------------+-------------+---------+----------+----------+----------+
| Foreign | - | - | - | - | (1,494) | (1,494) |
| exchange | | | | | | |
| movement | | | | | | |
+---------------+-------------+-------------+---------+----------+----------+----------+
| | | | | | | |
+---------------+-------------+-------------+---------+----------+----------+----------+
| 31 December | 3,057 | 493 | 13,915 | (29,823) | (1,328) | (13,686) |
| 2008 | | | | | | |
+---------------+-------------+-------------+---------+----------+----------+----------+
| | | | | | | |
+---------------+-------------+-------------+---------+----------+----------+----------+
| | | | | | | |
+---------------+-------------+-------------+---------+----------+----------+----------+
+---------------------------------------------+------------+------------+
| REVENUE BY GEOGRAPHICAL REGION | 2008 | 2007 |
| | GBP'000 | GBP'000 |
+---------------------------------------------+------------+------------+
| France | 4,806 | 5,331 |
+---------------------------------------------+------------+------------+
| Rest of Europe | 8,762 | 8,786 |
+---------------------------------------------+------------+------------+
| United States of America and Canada | 6,330 | 5,685 |
+---------------------------------------------+------------+------------+
| Asia | 2,704 | 3,255 |
+---------------------------------------------+------------+------------+
| Latin America | 2,463 | 1,828 |
+---------------------------------------------+------------+------------+
| Other | 2,247 | 2,450 |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
| Total Sales Revenue | 27,312 | 27,335 |
+---------------------------------------------+------------+------------+
| | | |
+---------------------------------------------+------------+------------+
The Group's revenue was all derived from its principal activity.
Based on risks and returns, the directors consider that the primary reporting
format is by business segment. The directors consider that there is only one
business segment being the manufacture and distribution of digital printing
systems together with all related consumables, spare parts, maintenance and
service.
The secondary reporting format is by geographical analysis by origination.
Segments where the Group has its principle operations are France, USA, Germany
and United Kingdom.
+----------------+---------+---------+---------+---------+---------+---------+---------+---------+---------+---------+
| SEGMENTAL | France | Rest of | USA | Plc | Total |
| ANALYSIS | | Europe | | | |
+----------------+-------------------+-------------------+-------------------+-------------------+-------------------+
| | 2008 | 2007 | 2008 | 2007 | 2008 | 2007 | 2008 | 2007 | 2008 | 2007 |
+----------------+---------+---------+---------+---------+---------+---------+---------+---------+---------+---------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
| | | | | | | | | | | |
+----------------+---------+---------+---------+---------+---------+---------+---------+---------+---------+---------+
| Revenue | 22,562 | 23,126 | 2,101 | 2,805 | 2,649 | 1,404 | - | - | 27,312 | 27,335 |
+----------------+---------+---------+---------+---------+---------+---------+---------+---------+---------+---------+
| | | | | | | | | | | |
+----------------+---------+---------+---------+---------+---------+---------+---------+---------+---------+---------+
| | | | | | | | | | | |
+----------------+---------+---------+---------+---------+---------+---------+---------+---------+---------+---------+
| Assets | 12,997 | 17,399 | 3,301 | 3,468 | 2,247 | 2,568 | 9,563 | 6,268 | 28,108 | 29,703 |
+----------------+---------+---------+---------+---------+---------+---------+---------+---------+---------+---------+
| | | | | | | | | | | |
+----------------+---------+---------+---------+---------+---------+---------+---------+---------+---------+---------+
| | | | | | | | | | | |
+----------------+---------+---------+---------+---------+---------+---------+---------+---------+---------+---------+
| Capital | 1,443 | 2,486 | 1 | 9 | 31 | 17 | 2 | - | 1,477 | 2,512 |
| Expenditure | | | | | | | | | | |
+----------------+---------+---------+---------+---------+---------+---------+---------+---------+---------+---------+
| | | | | | | | | | | |
+----------------+---------+---------+---------+---------+---------+---------+---------+---------+---------+---------+
| | | | | | | | | | | |
+----------------+---------+---------+---------+---------+---------+---------+---------+---------+---------+---------+
NIPSON DIGITAL PRINTING SYSTEMS PLC
Audited Results for the Year Ended 31 December 2008
The Group's main operations, including Marketing, Research & Development,
Manufacturing and Administration were located at Belfort in France from where
also all exports are made to the Group's other principle markets such as Asia,
Latin America and MEA (Middle East Africa).
+--------------------------------------------------+------------+----------+
| OPERATING EXPENSES | 2008 | 2007 |
| | GBP'000 | GBP'000 |
| | | |
+--------------------------------------------------+------------+----------+
| Research and development expenses (see also Note | 2,984 | 1,744 |
| 9) | | |
+--------------------------------------------------+------------+----------+
| Selling and marketing expenses | 3,619 | 3,581 |
+--------------------------------------------------+------------+----------+
| Administration expenses | 2,497 | 2,342 |
+--------------------------------------------------+------------+----------+
| | | |
+--------------------------------------------------+------------+----------+
| | 9,100 | 7,667 |
+--------------------------------------------------+------------+----------+
| | | |
+--------------------------------------------------+------------+----------+
+----------------------------------------------------+---------+---------+
| LOSS ON CONTINUING OPERATIONS | 2008 | 2007 |
| | GBP'000 | GBP'000 |
+----------------------------------------------------+---------+---------+
| Loss on ordinary activities before taxation is | | |
| stated after charging/(crediting): | | |
+----------------------------------------------------+---------+---------+
| Inventory expensed to Cost of Sales | 12,683 | 13,145 |
+----------------------------------------------------+---------+---------+
| Inventory Provision (Reversals)/Write-Offs | (429) | 408 |
+----------------------------------------------------+---------+---------+
| Depreciation on Tangible Non Current Assets: | | |
+----------------------------------------------------+---------+---------+
| Owned assets | 640 | 520 |
+----------------------------------------------------+---------+---------+
| Leased assets | 157 | 260 |
+----------------------------------------------------+---------+---------+
| Leased assets purchase and disposal (net impact) | - | 453 |
+----------------------------------------------------+---------+---------+
| (Profit)/Loss on disposal of Property Plant & | (98) | 2,791 |
| Equipment | | |
+----------------------------------------------------+---------+---------+
| Amortisation of Intangible Non Current Assets: | | |
+----------------------------------------------------+---------+---------+
| Acquired Patent Rights | 71 | 143 |
+----------------------------------------------------+---------+---------+
| Capitalised Research & Development Expenditure: | 1,461 | 526 |
+----------------------------------------------------+---------+---------+
| Operating lease rentals: | | |
+----------------------------------------------------+---------+---------+
| Motor vehicles and equipment | 113 | 73 |
+----------------------------------------------------+---------+---------+
| Land and buildings | 922 | 251 |
+----------------------------------------------------+---------+---------+
| Research and development expenditure | 2,984 | 1,744 |
+----------------------------------------------------+---------+---------+
| Retirement Provision Actuarial Costs | 135 | 85 |
+----------------------------------------------------+---------+---------+
| Retirement Provision reversed for Leavers | (644) | (73) |
+----------------------------------------------------+---------+---------+
| Legal Costs of defending Patent Court Case | - | (56) |
+----------------------------------------------------+---------+---------+
| Restructuring Plan Provision | 3,228 | - |
+----------------------------------------------------+---------+---------+
| Exceptional Inventory Provision | 2,992 | - |
+----------------------------------------------------+---------+---------+
| Provision for risk (litigation) | 933 | - |
+----------------------------------------------------+---------+---------+
| Losses on Currency | 1,857 | 720 |
+----------------------------------------------------+---------+---------+
| Gains on Currency | (412) | (103) |
+----------------------------------------------------+---------+---------+
| | | |
+----------------------------------------------------+---------+---------+
+----------------------------------------------------+----------+----------+
| FINANCE INCOME AND FINANCE COST | 2008 | 2007 |
| | GBP'000 | GBP'000 |
+----------------------------------------------------+----------+----------+
| Exchange rate gain | (412) | (103) |
+----------------------------------------------------+----------+----------+
| Interest receivable and discount | (58) | (88) |
+----------------------------------------------------+----------+----------+
| | | |
+----------------------------------------------------+----------+----------+
| Total Finance Income | (470) | (191) |
+----------------------------------------------------+----------+----------+
| | | |
+----------------------------------------------------+----------+----------+
| Bank interest payable | 383 | 483 |
+----------------------------------------------------+----------+----------+
| Group interest payable | 608 | 322 |
+----------------------------------------------------+----------+----------+
| Other interests from financing operations | 88 | 65 |
+----------------------------------------------------+----------+----------+
| Exchange rate difference | 1,857 | 720 |
+----------------------------------------------------+----------+----------+
| Interest payable on finance leases | 73 | 153 |
+----------------------------------------------------+----------+----------+
| | | |
+----------------------------------------------------+----------+----------+
| Total Finance Costs | 3,009 | 1,743 |
+----------------------------------------------------+----------+----------+
| | | |
+----------------------------------------------------+----------+----------+
| Net Finance Costs | 2,539 | 1,552 |
+----------------------------------------------------+----------+----------+
| | | |
+----------------------------------------------------+----------+----------+
NIPSON DIGITAL PRINTING SYSTEMS PLC
Audited Results for the Year Ended 31 December 2008
+-------------------------------------------+---+-----+---------+------------+
| BORROWINGS At amortised cost: | | | 2008 | 2007 |
| | | | GBP'000 | GBP'000 |
+-------------------------------------------+---+-----+---------+------------+
| Bank loans | | | 2,068 | 4,381 |
+-------------------------------------------+---+-----+---------+------------+
| Other loans | | | 3,696 | 1,677 |
+-------------------------------------------+---+-----+---------+------------+
| Loans from related parties (note 20) | | | 16,697 | 10,020 |
+-------------------------------------------+---+-----+---------+------------+
| Obligations under finance leases and hire | (note | 464 | 568 |
| purchase contracts | 14d) | | |
+-------------------------------------------+---------+---------+------------+
| | | | | |
+-------------------------------------------+---+-----+---------+------------+
| Total borrowings | | | 22,925 | 16,646 |
+-------------------------------------------+---+-----+---------+------------+
| | | | | |
+-------------------------------------------+---+-----+---------+------------+
| Amounts due for settlement within 12 | | | 18,780 | 12,870 |
| months | | | | |
+-------------------------------------------+---+-----+---------+------------+
| | | | | |
+-------------------------------------------+---+-----+---------+------------+
| Amounts due for settlement after 12 | | | 4,145 | 3,776 |
| months | | | | |
+-------------------------------------------+---+-----+---------+------------+
| | | | | |
+-------------------------------------------+---+-----+---------+------------+
The amount of bank loans dropped significantly in 2008 compared to 2007
following the repayment of the Hapoalim Bank loan by the Polar Group on behalf
of Nipson SAS.However, this increased the debts due by the Company to related
parties by the same amount of 2.2m Euros.The line "Other loans" includes the 5%
Convertible Loan Notes concluded with Roseman, the details of which are in the
note below. Loans from related parties also include the remainder of the 5%
Convertible Loan Notes concluded with Polar and hence Creacorp, the details of
which are also under the note on 5% Convertible Loan Notes below.
+--------------------------------------+--------+----------+---------+--------+---------+
| BORROWINGS | 2008 | 2007 |
| | GBP'000 | GBP'000 |
+--------------------------------------+-----------------------------+------------------+
| Analysis of bank and other loans and | Total | of | Total | of |
| including loans from related | | which | | which |
| parties: | | Secured | | Secured |
+--------------------------------------+-------------------+---------+--------+---------+
| Repayable within one year | 18,562 | 3,464 | 12,654 | 9,112 |
+--------------------------------------+-------------------+---------+--------+---------+
| Repayable in more than one but less | 357 | - | 3,306 | 343 |
| than two years | | | | |
+--------------------------------------+-------------------+---------+--------+---------+
| Repayable in more than two but less | 2,344 | - | 76 | - |
| than five years | | | | |
+--------------------------------------+-------------------+---------+--------+---------+
| Repayable in five years or more | 1,198 | - | 42 | - |
+--------------------------------------+-------------------+---------+--------+---------+
| | | | | |
+--------------------------------------+-------------------+---------+--------+---------+
| Total Loans | 22,461 | 3,464 | 16,078 | 9,455 |
+--------------------------------------+-------------------+---------+--------+---------+
| | | | | |
+--------------------------------------+--------+----------+---------+--------+---------+
5% CONVERTIBLE LOAN NOTES
At the EGM of the 28 February 2008, the shareholders passed a resolution
authorising the issue of 2,014,500 Euros of 5% convertible loan notes to D.R.
Investments Ltd. The convertible loans mature the 11 May 2011, 3 years from the
issue date the 12 May 2008. Under the terms of the agreement and in certain
circumstances, D.R. Investments Ltd. has the possibility to convert the loan
notes to a maximum of 25,821,956 ordinary shares of 1 pence each. Further to
these arrangements the Company issued 1,255,234 warrants to D. Roseman as broker
to the issue.
At the same EGM, the shareholders passed a resolution authorising the Company to
offer to the then majority shareholder, Polar Communications Ltd, 2,764,500
Euros of 5% convertible loan notes in exchange for loans at the same face value
being part of the total loans given to the Nipson Group by Polar during 2006 and
2007. The convertible loans mature the 11 May 2011, 3 years from the issue date
the 12 May 2008. Under the terms of the agreement and in certain circumstances,
Polar had the possibility to convert the loan notes to a maximum of 35,434,492
ordinary shares of 1 pence each. Following the agreement signed between Polar
and Creacorp of the 14 October 2008, Polar cancelled 2,200,000 Euros of the
aforementioned 5% convertible loan notes. These loan notes were replaced by an
interest free non-convertible loan repayable over 5 years starting in October
2009. The remaining 564,500 Euros of 5% Convertible Loan Notes were transferred
to Creacorp for a nominal consideration giving Creacorp, under the terms of the
agreement and in certain circumstances, the possibility to convert the
"remaining" loan notes to a maximum of 7,235,787 ordinary shares of 1 pence
each.
The value of the liability component and the equity component were determined at
the same time as the issue of the notes. The fair value of the liability
component included in non-current borrowings, was calculated using a market
interest rate based upon equity venture capital loans at 20%. The residual
amount representing the value of the equity conversion option (Equity Component)
is included in Shareholder's Equity in "Other Reserves". Following the
cancellation by Polar of part of the Loan Notes, the remaining 5% Convertible
Loan Notes in the balance sheet are calculated in the table below.
NIPSON DIGITAL PRINTING SYSTEMS PLC
Audited Results for the Year Ended 31 December 2008
+------------------------------------+-----------+------------+---------+--+---------+
| 5% CONVERTIBLE LOAN NOTES | "Roseman" | "Polar" | 2008 | | 2007 |
| | GBP'000 | & | Total | | Total |
| | | "Creacorp" | GBP'000 | | GBP'000 |
| | | GBP'000 | | | |
+------------------------------------+-----------+------------+---------+--+---------+
| Proceeds of Issue of Convertible | 1,434 | 1,969 | 3,403 | | |
| Loan Notes | | | | | |
+------------------------------------+-----------+------------+---------+--+---------+
| Equity Component | (385) | (528) | (913) | | |
+------------------------------------+-----------+------------+---------+--+---------+
| | | | | | |
+------------------------------------+-----------+------------+---------+--+---------+
| Liability Component on Initial | 1,049 | 1,441 | 2,490 | | - |
| Recognition 12/05/08 | | | | | |
+------------------------------------+-----------+------------+---------+--+---------+
| Finance Charge | 83 | 38 | 121 | | - |
+------------------------------------+-----------+------------+---------+--+---------+
| Amounts Repaid | - | (1,161) | (1,161) | | - |
+------------------------------------+-----------+------------+---------+--+---------+
| Foreign exchange retranslation of | 450 | 126 | 576 | | - |
| liability | | | | | |
+------------------------------------+-----------+------------+---------+--+---------+
| | | | | | |
+------------------------------------+-----------+------------+---------+--+---------+
| Liability Component at 31 December | 1,582 | 444 | 2,026 | | - |
+------------------------------------+-----------+------------+---------+--+---------+
| | | | | | |
+------------------------------------+-----------+------------+---------+--+---------+
Ultimate parent undertaking
As at the 31 December 2008, the majority shareholder of Nipson Digital Printing
Systems Plc was "Polar" an Israeli Group quoted on the Tel Aviv stock exchange
with 54.15% of Nipson's shares held by Polar Communications Ltd a company
incorporated in Israel and its direct and indirect subsidiaries, notably Koonras
BV BVBA, a company incorporated in Holland with its principal place of business
in Belgium. However, since the 14 October 2008 and as announced to the stock
exchange on the same day the Polar Group handed over control of the Nipson Group
to the Belgian company Creacorp NV following an agreement signed between Polar
and Creacorp, which among other conditions gave Creacorp the right to instruct
Polar to exercise its vote according to its wishes. As part of this same
agreement, Polar gave a call option to Creacorp for 22,992,709 shares (43.96% of
the Group's shares) out of the 28,323,067 shares held by Polar at that
time. The call option has been taken-up by Creacorp, but at the time of this
announcement the option was not fully executed. Creacorp did not hold Nipson
shares as at 31 December 2008 and will not be consolidating the Nipson figures.
The registered address of Creacorp NV is Palepelstraat 27, 9830
Sint-Martens-Latem, Belgium and is registered at the Tribunal de Commerce de
Gent, Belgium under N . BE 0451 683 765.
POST BALANCE SHEET EVENTS & GOING CONCERN
Background
As indicated in the Chairman's Statement, following the change in control of the
Company from Polar to Creacorp announced on 14 October 2008 and the subsequent
announcement on 28 October 2008 concerning the filing for the French
"Redressement Judiciaire" by its main operating subsidiary, Nipson SAS, the
French Administrator and the Court overseeing the procedure required a
commitment from the Company and Creacorp (resulting from the loans assigned to
Creacorp by Polar on the 14 October 2008) to restructure the capital and debt
position of Nipson SAS as part of the overall reorganisation plan, and in order
to continue the procedure with a view to returning the restructured business
back to the control of the Company. The administrator also required confirmation
from the Company confirming the nullity of the return to better fortune clauses,
which remained off balance sheet, relating to the "Forgiveness of loans"
contracts between the Company and its subsidiary Nipson SAS for a total of
15.5mEUR contracted as follows:
* Forgiving loans owed by Nipson SAS to the Company of 5.0mEUR signed 15 December
2004
* Forgiving loans owed by Nipson SAS to the Company of 5.0mEUR signed 21 September
2005
* Forgiving loans owed by Nipson SAS to the Company of 3.0mEUR signed 14 December
2006
* Forgiving loans owed by Nipson SAS to the Company of 2.5mEUR signed 19 December
2007
On 7 April 2009, Nipson announced that the reorganisation plan would necessitate
the forgiveness/conversion of debt and that this was likely to be a Related
Party Transaction under the AIM Rules.
Going Concern
At the time of the announcement of 14 May 2009 the Board agreed a restructuring
plan with Creacorp, which the French Court has presented to the creditors of
Nipson SAS. Accordingly, Nipson anticipates that the Redressement Judiciaire
procedure relating to Nipson SAS could be concluded within the timetable set by
the Court, being at or shortly after the next scheduled meeting with the French
Court on 23 June 2009, and that the Group could thereafter be able to resume its
operations under the full control of the Board.
NIPSON DIGITAL PRINTING SYSTEMS PLC
Audited Results for the Year Ended 31 December 2008
The Company entered into an agreement with its main operating subsidiary, Nipson
SAS, based in France, and Creacorp, pursuant to which:
* of the total amount owed by Nipson SAS to the Company of 7.6mEUR, the Company has
agreed to capitalise 6% (0.45mEUR) and waive the remaining 94% (7.15mEUR); and
* of the total amount owed by Nipson SAS to Creacorp of 14.6mEUR, Creacorp has
agreed to capitalise 6% (0.9mEUR) and waive the remaining 94% (13.7mEUR).
As a result of the capitalisation of debt set out in the Debt Restructuring
Agreement, Nipson's percentage holding of shares in the capital of Nipson SAS
would be reduced from 100% to 52.3%, and Creacorp would hold the remaining
47.7%.
As part of the reorganisation, the French Court has required additional
financial commitments from Creacorp to Nipson SAS. Creacorp has committed to
provide those funds as follows:
* a commitment letter to Nipson SAS, and a commitment in the Debt Restructuring
Agreement, stating it is willing to supply a loan of 1.0mEUR to Nipson SAS in 2009
when requested by the board of Nipson SAS, subject to leaving the procedure of
Redressement Judiciaire and subject to any insolvency of Nipson SAS or Nipson;
* a commitment letter to Nipson SAS from Nipson International NV, a 100%
subsidiary of Creacorp, stating it is willing to supply a loan of 1.0mEUR to
Nipson SAS in 2010 and a further 0.5mEUR in 2011, when requested by Nipson SAS,
subject to leaving the procedure of Redressement Judiciaire and subject to any
insolvency of Nipson SAS or Nipson;
* additional funding to the Company in the form of an interest-free, unsecured
loan with no fixed repayment date of EUR275,000, of which EUR175,000 has been paid
as at 31 May 2008.
* Nipson International NV who has invested in a production facility in Germany to
provide a production facility for the future production of Nipson equipment in
order to secure the continuity of Nipson SAS has committed to buy stock from
Nipson SAS for EUR800,000 cash, which represents the book value of the stock.
Nipson International NV will undertake production as a sub-contractor of Nipson
SAS.
No other alternatives were available for the Board to restructure the capital
and debt position than the proposed restructuring set out above. As a result of
this transaction all principal activities of the Nipson Group will stay with
Nipson SAS and the Company retains its majority position in Nipson SAS, which
secures management fees to flow from Nipson SAS to the Company.
In the light of the present financial position of the Company and Nipson SAS and
taking into account the severe market conditions which has made it impossible
for the business to raise any new equity or debt finance from external sources,
the Board considers that the transactions as set out above represent the only
realistic way of avoiding an insolvent liquidation of the Group.
The above proposals are contingent of successful conclusion of the Redressment
Judiciaire procedure which would result in the return of control of Nipson SAS.
If the process was to prove unsuccessful then the Group may not be able to
continue as a going concern as it is reliant on the continued support of
Creacorp NV. The directors are confident that their proposals will be approved
and therefore continue to prepare the financial statements on the going concern
basis.
NOTICE IS HEREBY GIVEN that the annual general meeting of the Company will be
held at 110 Cannon Street, London EC4N 6AR on 30 June 2009 at 11 am for the
purpose of considering in accordance with section 142 of the Companies Act 1985
whether any, and if so what, steps should be taken to deal with the situation
that the net assets of the Company are less than half of its called up share
capital and the transaction of the following ordinary business:
1. To receive and adopt the report of the directors and the audited accounts for
the year ended 31 December 2008 together with the report of the auditors
thereon.
2. To re-elect David Gestetner, who retires by rotation, as a director.
3. To confirm Marc Maes as a director, following his appointment the 14 October
2008.
4. To confirm Guillaume Dumarey as a director, following his appointment the 14
October 2008.
5. To confirm Ghislain Segard as a director, following his appointment the 14
October 2008.
6. To appoint Messrs RSM Bentley Jennison as auditors of the Company to hold office
until the conclusion of the next general meeting at which accounts are laid
before the Company and to authorise the directors to agree their remuneration.
+------------------------------------+----------------------------------------+
| Date:4th June 2009 | By Order of the Board |
| Registered Office: | Robert Cahill |
| 110 Cannon Street, London EC4N 6AR | Director |
+------------------------------------+----------------------------------------+
Notes:
1. Pursuant to regulation 41 of the Uncertificated Securities Regulations 2001, the
Company specifies that only those shareholders entered in the register of
members of the Company at 11.00 am on 28 June 2009 (or, if the meeting is
adjourned, at 11.00 am on the day which is two days prior to the adjourned
meeting) shall be entitled to attend or vote at the meeting in respect of the
number of shares registered in their name at the relevant time. Changes to
entries in the register of members after the relevant time will be disregarded
in determining the rights of any person to attend or vote at the meeting.
2. A member is entitled to appoint one or more proxies to exercise all or any of
his rights to attend and to speak and vote at the meeting. A proxy need not be a
member of the Company. If a member appoints more than one proxy in relation to
the meeting, each proxy much be appointed to exercise the rights attached to a
different share or shares held by the member. A member wishing to appoint more
than one proxy should contact the Company's registrars, Computershare, The
Pavilions, Bridgwater Road, Bristol BS13 8AE.
3. A form of proxy for use in relation to the meeting is enclosed. Completion and
return of the form of proxy will not prevent a member from attending and voting
at the meeting in person.
4. To be effective, the form of proxy and any power of attorney or other authority
under which it is signed (or a notarially certified copy of such power or
authority) must be deposited with the Company's registrars, Computershare, The
Pavilions, Bridgwater Road, Bristol BS13 8AE not less than 48 hours before the
time appointed for the holding of the meeting or any adjourned meeting.
5. The following documents will be available for inspection at the registered
office of the Company during normal business hours on any weekday (Saturdays,
Sundays and public holidays excepted) from the date of this notice of meeting up
to and including the date of the meeting and also at the place of the meeting
from at least 15 minutes prior to the meeting until its conclusion:
a) copies of the Directors' service contracts;
b) copies of the terms of appointment of the non?executive Directors.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR UKUNRKURNRAR
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