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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Sterling Green | LSE:SGG | London | Ordinary Share | GB00B1N0T068 | 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% | 0.44 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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TIDMSGG
30 September 2010
STERLING GREEN GROUP PLC
("Sterling Green" or "the Company")
Final Results for the year ended 31 March 2010
CHAIRMAN'S STATEMENT
Introduction and review of activities
I am pleased to present the final results of Sterling Green Group plc and its
subsidiaries ("the Group") covering the year ended 31 March 2010.
Results and dividends
Revenue for the year ended 31 March 2010 was GBP2,106,000 (2009 - GBP1,966,000),
which was made up of GBP1,977,000 (2009 - GBP1,609,000) from debt management
services and GBP129,000 (2009 - GBP357,000) relating to mortgage business.
The Group loss after taxation for the year amounted to GBP238,000 (2009 - GBP
347,000). The Directors are not able to recommend the payment of a dividend.
Trading review
Following the release in November 2009 of encouraging interim results for the
first half of the financial year, the second half proved to be very
disappointing, as the Group was unable to generate an operating profit for the
year as a whole. Although debt management revenues for the year increased by
22.9% compared to the previous year, revenues fell short of management
expectations for the second half of the financial year, in particular in the
final quarter, as the sign up of new customers slowed considerably. This had a
great deal to do with inconsistencies in the quality of leads from our external
lead generators which affected our conversion ratios. Mortgage business
remained very subdued during the year, in which there was a considerable 63.9%
fall in revenues.
Gross margins improved from 45.6% in 2009 to 46.4% for the current year, while
administration costs reduced by 6.2% compared to the previous year as the Board
continued to monitor and control Group overheads.
Current performance and future developments
The lead supply problems experienced earlier this year have now been addressed
as a number of new reliable lead providers have been sourced and evaluated,
which provides the Group with leads in appropriate quantities and of suitable
quality. While there is no guarantee that these arrangements will continue for
the long term, the Board believes that the appointment of an increased number
of reliable lead suppliers is a significant step forward for the Group in the
development of its current business model. Certainly the early signs for the
new financial year have been very encouraging, with the Group already adding
over 700 new clients since 31 March 2010 compared to 792 for the whole of the
previous year.
The mortgage industry remains very subdued. For the short term, the Board does
not envisage any improved revenue activity in this area and accordingly it
continues to monitor the contribution being made by this activity to the
Group's trading performance.
The Group's working capital position remains challenging. However, the rising
value of the Group's client portfolio, which is not recorded as an asset in the
Group's accounts, has enabled the Board to renew the Group's external loan
facilities to 30 September 2011. The Group is currently operating within these
borrowing facilities and based on forecasts prepared for the period ending 31
March 2012, management remain confident that this situation will continue
throughout the forecast period.
Trading in the period since 31 March 2010 has been marginally profitable at the
Group level and the Board continue to look at ways of increasing revenues and
profitability.
J M Edelson
Chairman
30 September 2010
Further enquiries:
Sterling Green Group plc Tel: 0161 975 5757
Michael Edelson
Merchant Securities Limited Tel: 020 7628 2200
Simon Clements/David Worlidge
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 MARCH 2010
Note 2010 2009
GBP000 GBP000
Revenue 2,106 1,966
Cost of sales (1,128) (1,069)
Gross profit 978 897
Administrative expenses (1,143) (1,218)
Loss from operations (165) (321)
Investment income - 5
Finance costs (72) (49)
Loss before tax (237) (365)
Income tax (charge)/credit 2 (1) 18
Loss for the year and loss attributable (238) (347)
to equity holders of the parent
Loss per share
Basic and diluted 3 (0.08p) (0.12p)
There were no other items of comprehensive income other than the loss for the
year.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31 MARCH 2010
2010 2009
GBP000 GBP000
Non-current assets
Intangible assets 1,115 1,115
Property, plant and equipment 116 209
Total non-current assets 1,231 1,324
Current assets
Trade and other receivables 108 142
Cash and cash equivalents 28 182
Total current assets 136 324
Current liabilities
Trade and other payables (361) (319)
Current tax liabilities (1) -
Borrowings (39) (86)
Total current liabilities (401) (405)
Net current liabilities (265) (81)
Non-current liabilities
Borrowings (279) (318)
Total non-current liabilities (279) (318)
Net assets 687 925
Equity attributable to the owners of the
parent
Called up share capital 304 288
Share premium account 1,794 1,710
Share capital to be issued - 100
Capital reserve 6 6
Other reserve 891 891
Accumulated losses (2,308) (2,070)
Total equity 687 925
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 MARCH 2010
Note 2010 2009
GBP000 GBP000
Cash flows from/(used in) operating activities
Loss before tax (237) (365)
Adjustments for:
Depreciation of property, plant and equipment 98 101
Investment income - (5)
Finance costs 72 49
Operating cash flows before movement in working (67) (220)
capital
Decrease/(Increase) in trade and other 34 (1)
receivables
Increase in trade and other payables 42 1
Net cash from/(used in) operating activities 9 (220)
Cash flows (used in)/from investing activities
Investment income received - 5
Purchase of property, plant and equipment (5) (1)
Net cash (used in)/from investing activities (5) 4
Cash flows (used in)/from financing activities
Capital element of lease payments (86) (85)
Loans advanced - 250
Issue of ordinary share capital - 200
Proceeds in advance of issue of share capital - 100
Finance costs paid (72) (49)
Net cash (used in)/from financing activities (158) 416
Net (decrease)/increase in cash and cash (154) 200
equivalents
Cash and cash equivalents at the start of the 182 (18)
year
Cash and cash equivalents at the end of the year 4 28 182
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 MARCH 2010
Attributable to equity holders of the parent
Share Share Share Capital Other Accumulated Total
capital premium capital reserve reserve losses
account to be
issued
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
At 1 April 2008 280 1,518 - 6 891 (1,723) 972
Loss for the year - - - - - (347) (347)
Issue of share 8 192 - - - - 200
capital
Share capital to be - - 100 - - - 100
issued
At 31 March 2009 288 1,710 100 6 891 (2,070) 925
Loss for the year - - - - - (238) (238)
Issue of share 16 84 (100) - - - -
capital
At 31 March 2010 304 1,794 - 6 891 (2,308) 687
Other reserve
The other reserve is a merger reserve created on the acquisition of Sterling
Green Limited.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2010
1. Basis of preparation
The financial statements have been prepared in accordance with International
Financial Reporting Standards ("IFRS") as adopted by the European Union and
with those parts of the Companies Act 2006 applicable to companies reporting
under IFRS.
The financial information set out above does not constitute the Company's
statutory financial statements for the years ended 31 March 2009 and 31 March
2010, but is derived from those financial statements. The Auditors have
reported on those financial statements; their reports were unqualified and did
not contain statements under the Companies Act 1985, sections 237(2) or (3).
The statutory accounts for the year ended 31 March 2009 have been delivered to
the Registrar of Companies, whereas those for the year ended 31 March 2010 will
be delivered in due course.
The Board has considered the Group's financial position and trading prospects
using detailed forecasts covering the period ending 31 March 2012. Those
forecasts incorporate the current drawn down loan facility which is confirmed
as available until 30 September 2011. There are no financial covenants attached
to that facility. Accordingly, the Board considers that there will be no
breaches of financial covenants during the period to 30 September 2011. Having
made appropriate consideration, the Board believes that it has adequate
resources to continue trading for the foreseeable future, and accordingly, the
going concern basis has been adopted in preparing these financial statements.
2. Income tax (charge)/credit
2010 2009
GBP000 GBP000
Current year tax:
UK corporation tax - 18
Prior year tax:
UK corporation tax underprovided (1) -
(1) 18
Corporation tax is calculated at 28% (2009 - 28%) of the estimated assessable
loss for the year.
The tax (charge)/credit for the year can be reconciled to the consolidated
statement of comprehensive income as follows:
2010 2009
GBP000 GBP000
Loss before tax (237) (365)
Loss on ordinary activities multiplied by the (66) (102)
relevant standard rate of corporation tax in
the UK of 28% (2009 - 28%)
Effect of:
Expenses not deductible for tax purposes 4 6
Depreciation for year in excess of capital 4 28
allowances
Utilisation of losses - 18
Losses carried forward 58 68
UK Corporation tax underprovided in prior year (1) -
Total tax (charge)/credit for the year (1) 18
Unrecognised deferred tax assets
The following deferred tax assets have not been brought into account as assets:
2010 2009
GBP000 GBP000
Tax losses 534 476
Temporary differences 60 56
3. Loss per share
The calculation of basic loss per share is based on the following:
Basic 2010 2009
Loss for the year (GBP000) (238) (347)
Weighted average number of shares 303,587,719 287,569,637
Loss per share (pence) (0.08) (0.12)
Diluted loss per share is calculated by adjusting the weighted average number
of ordinary shares in issue assuming conversion of all dilutive potential
ordinary shares. During the year the Company's potential ordinary shares
consist of share options. Due to losses in the current and preceding year there
are no dilutive ordinary shares.
4. Notes to the cashflow statement
Cash and cash equivalents
Cash and cash equivalents consist of bank balances. Cash and cash equivalents
included in the cash flow statement comprise the following amounts:
2010 2009
GBP000 GBP000
Cash at bank 28 182
5. Related party transactions
The services of J M Edelson were provided to the Group under a service
agreement by London & City Credit Corporation Limited. Amounts charged to the
Group during the year for his services amounted to GBP25,000 (2009 - GBP25,000). At
31 March 2010 GBP2,448 (2009 - GBPnil) of this amount remained outstanding.
S. T. Ali and J. McClean have provided personal guarantees as security for GBP
250,000 of the loan facility available to the Group.
6. Dividend
The directors are not able to recommend the payment of a dividend.
7. Copies of the Report & Accounts
Copies of the Report & Accounts will be posted to shareholders shortly and are
also available from the Company's registered office at Number 14, The
Embankment, Vale Road, Heaton Mersey, Stockport, Cheshire SK4 3GN and from the
Company's website www.sterlinggreen.co.uk.
38
END
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