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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Ross Group Plc | LSE:RGP | London | Ordinary Share | GB0002192606 | ORD 0.1P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 0.75 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
Engineering Services | 0 | -2.58M | -0.0106 | -0.71 | 1.82M |
TIDMRGP
RNS Number : 6090K
Ross Group PLC
29 August 2019
Ross Group Plc Half Yearly Financial Report 30(th) June 2019 HALF YEARLY FINANCIAL REPORT FOR THE SIX MONTHSED 30 JUNE 2019 Financial Summary (6 months to 30 June 2019) 2019 2018 GBP'000 GBP'000 Change Group Revenue - 68 -100% Gross Profit/(Loss) - 10 -100% Profit/(Loss) before tax (3,151) 10 -31,610% Basic earnings per share -28.1p 0.006p -4,718% Diluted earnings per share -28.1p 0.006p -4,718% Chairman's Statement For the half year to 30th June 2019, I would like to report that in this period, during which the acquisition of the start-up businesses within the Archipelago Aquaculture Group was duly completed in January 2019, the Ross Group PLC has now proceeded to implement its planned investment strategy and as a result has therefore subsequently made a net loss after tax of GBP3,151,000 without revenue, which is both in line with management expectation and to the Board's satisfaction at this stage. The Board in the first half 2019 has already started the process of integrating the respective start-up businesses acquired within its existing operations and is currently implementing its supply chain management protocols, procedures and respective disciplines, in order to put in place a vertically integrated organization that will be in a position to provide a forecast in the foreseeable future of being able to produce high quality Chitin in the years to come. Notwithstanding the previous years whereby we utilised our specialist supply chain management services in order to sustain our operational overhead - whilst also endeavouring and exploring other strategic opportunities - our efforts nowadays are fully focused on building a business that will hopefully become the best in the Chitin and/or Chitin-related industries. As a result, there has been no revenue during this period from any outside third party contracts. As per the duly executed Sale & Purchase Agreement ("SPA") with Global Blue Technologies Group Inc. ("GBTGI"), all of the now enlarged Ross Group's overhead and cashflow are to be fully financed for at least the first 18 months, during which there are various performance-related SPA parameters in place in order to protect the value and integrity of this most important first acquisition. Business Outlook For the second half of 2019 the Board and myself will continue, along with our team of Advisors and Consultants, to work tirelessly with our new related-party GBTGI shareholders and their specialist management team in trying to successfully build a business through implementing our unique, patented production process (for which we recently received the internationally prestigious Green Chemical Award) and hopefully to be able to enter into proto-type pilot production phase and/or trials in the foreseeable future. In addition, we are also continuing to explore synergistic opportunities to further grow our overall business; both horizontally and vertically - so as to try to become the best in our chosen specialist industry. Dividend No ordinary interim dividend is proposed after considering the result for the first half of the year, and the existing deficiency of retained reserves. I would very much like to thank the members of the Board of Directors, as well as our contractors, consultants and advisors for all their continued, and highly appreciated, support, expertise and hard work. Finally, as always, I would also like to personally extend my sincere thanks to our extraordinarily loyal and also now new (GBTGI) shareholders for all their continued confidence, patience and truly exceptional understanding. However, please kindly know that this is now a new and exciting period for our Ross Group and I sincerely hope that we will all be able to enjoy an exciting future together. Barry Richard Pettitt Chairman and Group Managing Director Approved 29 August 2019 CONDENSED CONSOLIDATED INCOME STATEMENT UNAUDITED 6 months 6 months Year Ended ended 30 ended 30 June June 31 Dec 2019 2018 2018 GBP'000 GBP'000 GBP'000 Group Revenue Continuing Operations - 68 70 Discontinuing Operations - - - Operating (Loss) / Profit Continuing Operations (2,926) 10 (196) Discontinuing Operations - - - (Loss) / Profit before Finance Cost (2,926) 10 (196) --------- --------- ----------- Finance Cost 225 - 54 (Loss) / Profit before Taxation (3,151) 10 (250) --------- --------- ----------- Taxation - - - (Loss) / Profit for the Period (3,151) 10 (250) --------- --------- ----------- Earnings per share (pence) -28.1 0.006 -0.14 Adjusted earnings per share (pence) -28.1 0.006 -0.14 CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY UNAUDITED Share Accumulated Other Total Capital Losses Reserves GBP'000 GBP'000 GBP'000 GBP'000 Balance at 1 Jan 2018 11,179 (35,634) 18,187 (6,268) Profit for the period - 10 - 10 --------- ------------ ---------- -------- Total recognised income - 10 - 10 --------- ------------ ---------- -------- Balance at 30 June 2018 11,179 (35,624) 18,187 (6,258) --------- ------------ ---------- -------- (Loss) / Profit for the period - (260) - (260) --------- ------------ ---------- -------- Total recognised income - (260) - (260) --------- ------------ ---------- -------- Value of conversion rights on convertible loans - - 5,127 5,127 Balance at 31 Dec 2018 11,179 (35,884) 23,314 (1,391) --------- ------------ ---------- -------- Balance at 1 Jan 2019 11,179 (35,884) 23,314 (1,391) (Loss) / Profit for the period - (3,151) - (3,151) --------- ------------ ---------- -------- Total recognised income / (deficit) - (3,151) - (3,151) --------- ------------ ---------- -------- Foreign exchange adjustment - (9) - (9) Share capital issued 39 - 343 382 Movement on convertible loans - - 205 205 Balance at 30 June 2019 11,218 (39,044) 23,862 (3,964) --------- ------------ ---------- -------- CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION UNAUDITED 6 months 6 months Year Ended ended 30 ended 30 June June 31 Dec 2019 2018 2018 GBP'000 GBP'000 GBP'000 Non Current Assets 19,039 - - Current Assets Inventories 1,311 - - Trade and Other Receivables 6,570 79 83 Cash and Cash Equivalents 263 1 20 8,144 80 103 Total Assets 27,183 80 103 --------- --------- ----------- Equity and Liabilities Shareholders' Equity Share Capital 11,218 11,179 11,179 Share Premium Account 3,146 2,803 2,803 Other Reserves 15,384 15,384 15,384 Convertible debentures 5,332 - 5,127 Retained Earnings (39,044) (35,624) (35,884) --------- --------- ----------- Total Equity (3,964) (6,258) (1,391) Non-Current Liabilities Long Term Borrowings 29,767 6,072 632 Current Liabilities Trade and Other Payables 856 256 316 Bank Overdraft and Loans 524 10 546 --------- --------- ----------- Total Liabilities 31,147 6,338 1,494
Total Equity and Liabilities 27,183 80 103 --------- --------- ----------- CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS UNAUDITED 6 months 6 months Year Ended ended 30 ended 30 June June 31 Dec 2019 2018 2018 GBP'000 GBP'000 GBP'000 Net Cash From/(Used In) Operating Activities 11,749 (18) (114) Net Cash Used In Investing Activities (8,553) - (15) Cash Flows From Financing Activities: Amount withdrawn by Directors (11) - (38) Value of conversion rights on convertible shares - - 5,127 Proceeds from the issue of shares 382 - - Interest paid - - (54) Net Increase/(Decrease) In Borrowings (3,324) - (4,905) --------- --------- ----------- Net Cash Flow From Financing Activities 243 (18) 1 --------- --------- ----------- Net Increase/(Decrease) In Cash and Cash Equivalents 243 (18) 19 Cash and Cash Equivalent at Beginning of Period 20 19 1 --------- --------- ----------- Cash and Cash Equivalent at End of Period 263 1 20 --------- --------- ----------- Notes to the Interim Report (1) The financial information contained in these statements for the six months ended 30 June 2019 and 30 June 2018 is unaudited and does not constitute statutory accounts as defined in section 434 of the Companies Act 2006. These statements are prepared in accordance with International Financial Reporting Standards (IFRS) as adopted in the EU. The interim financial statements have been prepared on the basis of the accounting policies set out in the audited statutory accounts for the year ended 31 December 2018 together with additional accounting policies as follows:- Goodwill Goodwill arising on consolidation arises from the fair value of the identifiable assets acquired by the group at the date of acquisition. An impairment loss calculation is undertaken at the financial period end of the assets acquired and any impairment in the value is taken to the Income Statement. The first impairment review is to be undertaken within a twelve-month period of the date of the acquisition and therefore this will take place in the 31 December 2019 financial statements. The directors do not believe there is any indication of impairment at this time. Intangible assets These mainly consist of software and licences. Intangible assets are stated at cost less accumulated amortisation and impairment losses. Licences are amortised over their term period or their estimated useful economic lives, as appropriate, on a straight-line basis which is considered to be 15 years. Property, plant and equipment Property plant and equipment are carried at cost or deemed cost (fair value on acquisition through business combination) less accumulated depreciation and impairment provisions. Acquisition cost includes the purchase price plus other costs related to acquisition, such as freight, postage, duties, commissions, interest on investment loans recorded before the tangible assets are capitalised or before they are put into use. The costs of expansion, modernisation, or improvements leading to increased productivity, capacity or efficiency are capitalised. Maintenance and repair expenses are expensed as incurred. Where the carrying amount of an asset is greater than the amount that it is estimated to be recoverable, it is written down to its recoverable amount. The Group depreciates its property, plant and equipment on a straight line basis in order to write off the cost of each asset less the estimated residual value over its estimated useful life as follows: Building 39 years straight line basis Leasehold Improvements Over the term of the lease Plant, Machinery and Equipment 7 years straight line basis Right of use assets Over the term of the lease Leases IFRS 16 leases accounting has been applied from 1 January 2019. Finance lease arrangements for the group's overseas locations are recognised in the Consolidated Statement of Financial Position on signing of the lease as a right-of-use asset. The lease cost will be recognised as the depreciation of the right-of-use asset over the term of the lease. A lease liability is recognised on signing of the lease equal to the present value of the lease payments and estimated renovation costs discounted using a borrowing rate determined by the company. The interest expense will be recognised in the Consolidated Income Statement as the lease payments are made. The impact of the implementation of IFRS 16 is reflected in the acquisition of AAG. Inventory Inventories are measured at the lower of cost and net realisable value. Foreign currencies Transactions in currencies other than the functional currency (foreign currencies) are translated into the functional currency at exchange rates which approximate those applicable at transaction dates. Foreign currency monetary assets and liabilities at the statement of financial position date are translated into the functional currency at exchange rates ruling at that date. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated. Any gain or loss arising from a change in exchange rates subsequent to the date of the transaction is included as an exchange gain or loss in the statement of comprehensive income. (2) Reconciliation of Operating Profit to Net Cash Flows From Operating Activities 6 months 6 months Year Ended ended 30 ended 30 June June 31 Dec 2019 2018 2018 GBP'000 GBP'000 GBP'000 Operating (Loss) / Profit On Continuing Activities (2,926) 10 (196) Impairment - - 15 Exchange difference (9) - - Depreciation and Amortisation 1,478 - - (Increase)/ Decrease In Inventories (1,311) - - (Increase)/ Decrease In Trade and Other Receivables (102) (75) (68) Increase/(Decrease) In Trade and Other Payables 14,619 47 135 Net Cash Generated From/(Used In) Operations 11,749 (18) (114) --------- --------- ----------- (3) No ordinary interim dividend is proposed for 2019 (2018 - GBPNil). (4) The comparative cash flow for the year ended 31 December 2018 has been extracted from the audited accounts. The cash flows for the six months ended 30 June 2019 and 30 June 2018 are unaudited. (5) Reconciliation of Movements In Equity 6 months 6 months Year Ended ended 30 ended 30 June June 31 Dec 2019 2018 2018 GBP'000 GBP'000 GBP'000 Share Premium Account Brought Forward 2,803 2,803 2,803 Movement 343 - - --------- --------- ----------- Carried Forward 3,146 2,803 2,803 --------- --------- ----------- Other Reserves Brought Forward 15,384 15,384 15,384 Movement - - - --------- --------- ----------- Carried Forward 15,384 15,384 15,384 --------- --------- ----------- Retained Earnings Brought Forward (35,884) (35,634) (35,634) (Loss) / Profit for the Period (3,151) 10 (250) Foreign exchange adjustment (9) - - Carried Forward (39,044) (35,624) (35,884) Convertible Debenture Brought Forward 5,127 - - Movement 205 5,127 - Carried Forward 5,332 5,127 - --------- --------- ----------- (6) On the 7 January 2019 the company acquired the entire capital of Archipelago Aquaculture Group LLC ("AAG"), a company registered in the United States, for equity consideration amounting to GBP202,731 representing the issue
of 21,340,104 Ordinary Shares at a market value of .95p per share in a share for share exchange. AAG are specific supply chain companies involved in the research and development of Chitin. The fair value of the group acquired is as follows GBP,000 Non current assets 19,940 Inventory 1,096 Trade and other receivables 5,206 Cash and cash equivalents 1,178 Current liabilities (447) Non current liabilities (26,973) Net Identifiable assets acquired - Add Goodwill 203 Total Consideration 203 --------- AAG group generated a loss to the group for the period amounting to GBP2,879,000 (7) Non Current Assets Intellectual Property, Property Plant & Goodwill Licences Equipment Total GBP'000 GBP'000 GBP'000 GBP'000 Cost At 1 January 2019 - - - - Additions 956 12,661 6,900 20,517 At 30 June 2019 956 12,661 6,900 20,517 --------- ------------- ---------- -------- Depreciation / Amortisation At 1 January 2019 - - - - Charge for the period - 1,318 160 1,478 --------- ------------- ---------- -------- At 30 June 2019 - 1,318 160 1,478 --------- ------------- ---------- -------- Net Book Value At 30 June 2019 956 11,343 6,740 19,039 --------- ------------- ---------- -------- At 1 January 2019 - - - - --------- ------------- ---------- -------- (8) Inventory 30 June 31 Dec 30 June 2019 2018 2018 GBP'000 GBP'000 GBP'000 Raw materials 1,271 - - Finished goods 40 - - 1,311 - - -------- -------- -------- (9) Current Assets 30 June 31 Dec 30 June 2019 2018 2018 GBP'000 GBP'000 GBP'000 Trade receivables 68 68 68 Prepayments and accrued income 55 - - Other debtors 51 5 11 Directors loan 22 10 - Loans to associated undertakings 6,374 - - 6,570 83 79 -------- -------- -------- (10) Current Liabilities 30 June 31 Dec 30 June 2019 2018 2018 GBP'000 GBP'000 GBP'000 Trade payables 226 201 179 Other creditors 78 23 27 Accruals and deferred income 345 92 23 Directors loan - 27 - Lease creditor 207 - Debentures 524 367 Other loans - 179 10 1,380 862 266 -------- -------- -------- (11) Non Current Liabilities 30 June 31 Dec 30 June 2019 2018 2018 GBP'000 GBP'000 GBP'000 Accruals and deferred income 14,286 - - Licence fee payable 11,964 - - Lease creditor 489 - - Debentures 420 632 - Loans from associated undertakings 2,608 - 6,072 29,767 632 6,072 -------- -------- -------- (12) The Group is supported by short term borrowings from its larger shareholders and supporters by way of formal agreements. At 30 June 2018 total borrowings from One World Limited were GBP4,010,000 and GBP2,062,172 from Excite Enterprises Limited, neither of which is a related party. On 27 September 2018 two convertible loan debentures were issued for GBP4,010,000 and GBP2,062,172 with a coupon rate of 5%. The loan notes are convertible into Ordinary shares of the parent entity in three years after the date of issue. The convertible loan debenture will give right to a percentage of the issued share capital of the parent company at the date of conversion. Each tranche of GBP1 million debenture owed by the long term holders correspond to 4.925% of the issued share capital at the date of conversion, resulting in a fixed percentage of the issued share capital of the company to be allotted to the loan holders regardless of the value / amount of the share capital of the company. 30 June 31 Dec 2019 2018 GBP'000 GBP'000 Face value of notes issued 6,072 6,072 Value of conversion rights 5,332 5,127 Convertible loan debenture liability 740 945 -------- -------- Interest expense 151 54 -------- -------- During the period a subsidiary company, Ross Group Plc Inc, received a loan from One World Limited amounting to $800,000 which equates to GBP639,720. Interest is charged on this loan at 6% On 29 January 2019 the company issued 17,947,943 Ordinary Shares to GBTGI for a total cash consideration of GBP179,479. During the period the group received working capital from GBTGI and its affiliated companies amounting to GBP1,968,120 and made loans to them amounting to GBP6,374,361. GBTGI have provided assurance to the Ross Group that they will fund ongoing cashflow requirements for a period of 18 months from January 2019. (13) The Chief Operating Decision Maker (CODM) has considered the requirements of future segmental reporting following the acquisition of US based AAG in January 2019. At this stage the AAG group is in start up and is not revenue generating. This group is therefore reported as one reportable segment to the CODM. As the UK activities of the Ross Group are less than 10 percent in terms of assets, liabilities and loss for the period and no revenue has been generated throughout the group during this financial period the CODM believes the information already disclosed in the interim financial statements is adequate to fulfill the requirements of IFRS 8 segmental reporting, this will be reconsidered at the year end and in future periods as AAG begins to trade. (14) The Interim Report will be sent by mail to all registered shareholders and copies will be available from the Company's registered office at 71-75 Shelton Street, London, WC2H 9JQ. A downloadable copy will also be posted on the Company's website www.ross-group.co.uk Responsibility statement: The Directors confirm that, to the best of their knowledge: - a) the condensed set of financial statements has been prepared in accordance with IAS 34 'Interim Financial Reporting'; b) the interim management report includes a fair review of the information required by DTR 4.2.7R (indication of important events during the first six months and description of principal risks and uncertainties for the remaining six months of the year); and c) the interim management report includes a fair review of the information required by DTR 4.2.8R (disclosure of related parties' transactions and changes therein). On behalf of the Board B Pettitt Chief Executive Officer Ross Group plc Registered Office 71 - 75 Shelton Street London WC2H 9JQ Contact - M Simon, Non Executive Director Tel. - 0203 978 4598 Email - info@ross-group.co.uk Website - www.ross-group.co.uk
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
END
IR PLMITMBMTBRL
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August 29, 2019 10:12 ET (14:12 GMT)
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