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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Worthington Group Plc | LSE:WRN | London | Ordinary Share | GB00B01YQ796 | ORD 10P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 87.00 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Oct 2019 to Oct 2024
TIDMWRN
RNS Number : 2926Q
Worthington Group PLC
29 August 2014
Worthington Group plc ("the Company")
Unaudited Interim results for the Six months Ended on the 31(st) March 2014, followed by the audited Results for the Eighteen months Ended 30(th) September 2013.
Interim Financial Statements for six months ended 31st March 2014
Chief Executive's Statement
I am pleased to be able to say that in the period covered by this Interim Report and Accounts the Company has made considerable steps forward. The key highlights are:
We are acquiring substantial assets in a diverse portfolio of industry sectors in the UK and world-wide.
New investments - we are in advanced discussions with partners in the energy, mining and media sectors and expect to make a number of announcements very soon which will add to revenues in the next six months.
Oil and gas - we are close to completing a major oil and gas investment and expect to be able to announce details before the end of September.
Mining - at the time of writing we have reached agreement in principle to acquire a significant interest in an exploration company with exciting prospects in the rare earth sector. We expect to be in a position to make an announcement in relation to this transaction with the next seven days.
Media - we have reached broad agreement in principle to acquire a portfolio of media businesses and negotiations are expected to be completed shortly.
Litigation funding - we have broadened our legal claims portfolio so that claims in our litigation division now include both UK claims and also international claims with a total claims value of more than GBP30m. We expect to be able to update shareholders in relation to our claims portfolio shortly.
As a result of these efforts, I am able to announce first half profits of GBP8.7m.
Interim profits for half year ended 31(st) March 2014 of GBP8.7m against a loss in 2012/13 of GBP5.3m
This has resulted in a vastly strengthened our Balance Sheet.
Our net asset position is now GBP5.9m as at 31(st) March 2014 up from -GBP3.5m for the 18 month period ended 30(th) September 2013.
Pension fund resolution is also imminent.
It has been our priority to both reach a fair settlement for the pension fund recipients whilst capping our liabilities. I am very pleased to say we have found a solution to the deficit that balances both needs. The solution proposed is expected to have a positive effect on the Group's balance sheet but is not yet reflected in our accounts. More details will be announced shortly.
On 16(th) April 2013, the Company acquired 26% of the shares in Law Financial Ltd in exchange for GBP250,000 of Unsecured Convertible Loan stock 2020, with an option to acquire the remaining 74% of the shares by 31(st) October 2013. This option was exercised on 28(th) October 2013 and the remaining shares were acquired in exchange for GBP750,000 of Unsecured Convertible Loan Stock 2020. The Unsecured Loan Stock 2020 includes warrants to subscribe for 20m ordinary shares in the Company at an exercise price of 5p each, subject to a share capital re-organisation being approved by shareholders.
On 4(th) March 2014, in order to fund corporate finance activities, the Company issued GBP130,570 of Unsecured Convertible Loan Stock 2021 which was subsequently converted into 1,305,700 ordinary 10p shares in the Company on 21(st) March 2014 at a conversion price of 10p per Worthington share.
On 14(th) April 2014, the Company issued GBP302,400 and GBP24,000 of the unissued Secured Convertible Loan Stock 2019 to European and Asian Ltd (the holding company of Mandolyn Ltd of which Doug Ware is a director) and Richard Spurway, a director, respectively. The consideration for the issue was the cancellation of the remaining notice period on their respective contracts. This was in order to secure the remaining monies due to the respective parties in accordance with their contracts should their roles be terminated and/or their contracts not be honoured for any reason. They have agreed to surrender all the loan stock for nil consideration once an agreement is reached with the Pension Trustee, the Pension Regulator and the PPF. This would enable the re-structuring of the Company with the scheme being transferred into the PPF.
In May 2014, contracts were exchanged for the sale of our Keighley freehold property for GBP475,000, completion of the sale is due before the end of September 2014.
In July 2014 the Company sold its shares in Trimmings for GBP1 and accepted the sum of GBP399,999 in settlement of the unsecured loan stock which was not due for repayment by Trimmings until 31 December 2200. Interest on the loan notes has been paid up to 30(th) June 2014; in addition, a final management charge of GBP71,750 plus VAT has been received by the Company. The directors believe that the realisation of cash from this historic investment is in the best interests of the Company. Accordingly a provision against the carrying value of the investment of GBP237,000 has been made together with a provision for the write down in the value of the loan notes of GBP400,001 following the sale agreement.
Finally, in presenting this interim report I am delighted to be able to inform shareholders that the Company is in good shape, going forward into the coming months with a clear strategy and a secure footing. I appreciate that for many of you this moment has been long awaited and I'd like to thank all our stakeholders for remaining loyal to us during this period when, at times, it must have appeared as though not much was happening. With rising economic confidence in the UK and many opportunities for us both here at home and internationally I believe we have an excellent future ahead of us.
Doug Ware
Chief Executive
20 August 2014
This interim report may contain forward-looking statements based on current expectations of, and assumptions and forecasts made by management. Various known and unknown risks, uncertainties and other factors could lead to substantial differences between the actual future results and, financial situation development or performance of the company and the estimates and historical results given herein. Undue reliance should not be placed on forward looking statements which speak only as at the date of this document. We undertake no obligation publicly to update or revise any forward-looking statements, except as may be required by law.
Consolidated Income Statement
Hot Features
Premium
for the six months ended 31(st) March 2014
Note
Unaudited Unaudited Audited
6 months ended 6 months 18 months
31 March ended ended
2014 31 March 30 September
2013 2012
GBP'000 GBP'000 GBP'000
------------------------------- ----- ----------------- ------------ ---------------
Continuing operations
------------------------------- ----- ----------------- ------------ ---------------
Revenue 1 1 264
------------------------------- ----- ----------------- ------------ ---------------
Cost of sales (60) - (41)
------------------------------- ----- ----------------- ------------ ---------------
_____ _____ _____
------------------------------- ----- ----------------- ------------ ---------------
Gross (loss)/profit (59)) 1 223
------------------------------- ----- ----------------- ------------ ---------------
Administrative expenses (62) (267) (588)
------------------------------- ----- ----------------- ------------ ---------------
Share based payment (54) (14) (58)
------------------------------- ----- ----------------- ------------ ---------------
Pension scheme related
costs (60) - (675)
------------------------------- ----- ----------------- ------------ ---------------
Gain on bargain purchase 9 9,034 - -
------------------------------- ----- ----------------- ------------ ---------------
_____ _____ ______
------------------------------- ----- ----------------- ------------ ---------------
Operating profit/(loss) 8,799 (280) (1,098)
------------------------------- ----- ----------------- ------------ ---------------
Investment revenues 26 55 125
------------------------------- ----- ----------------- ------------ ---------------
Investment property write
down - (3,525)
------------------------------- ----- ----------------- ------------ ---------------
Investment in associate
write down - (638)
------------------------------- ----- ----------------- ------------ ---------------
Pension finance costs (79) (130) (237)
------------------------------- ----- ----------------- ------------ ---------------
Interest payable (60) (9)
------------------------------- ----- ----------------- ------------ ---------------
Share of results of associate - (5) 97
------------------------------- ----- ----------------- ------------ ---------------
______ _____ ______
------------------------------- ----- ----------------- ------------ ---------------
Profit/(loss) before taxation 8,686 (360)) (5,285)
------------------------------- ----- ----------------- ------------ ---------------
Taxation
------------------------------- ----- ----------------- ------------ ---------------
_____ _____ ______
------------------------------- ----- ----------------- ------------ ---------------
Profit/(loss) on ordinary
activities after taxation 8,686 (360)) (5,285)
------------------------------- ----- ----------------- ------------ ---------------
_____ _____ ______
------------------------------- ----- ----------------- ------------ ---------------
Earnings/(loss) per ordinary
share
------------------------------- ----- ----------------- ------------ ---------------
Basic 5 64.9p (2.8p) (42.0p)
------------------------------- ----- ----------------- ------------ ---------------
_____ _____ _____
------------------------------- ----- ----------------- ------------ ---------------
Fully diluted N/A N/A N/A
------------------------------- ----- ----------------- ------------ ---------------
_____ _____ _____
------------------------------- ----- ----------------- ------------ ---------------
Consolidated Statement of Comprehensive
Income Unaudited Unaudited Audited
6 months 6 months 18 months
ended ended ended
31 March 31 March 30 September
2014 2013 2013
GBP'000 GBP'000 GBP'000
----------------------------------------- ------------ ------------ ---------------
Profit/(loss) for the period 8,686 (360) (5285)
----------------------------------------- ------------ ------------ ---------------
Actuarial loss on retirement benefit
obligation - - (73)
----------------------------------------- ------------ ------------ ---------------
_____ _____ _____
----------------------------------------- ------------ ------------ ---------------
Total comprehensive profit/(loss)
for the period 8,686 (360) (5358)
----------------------------------------- ------------ ------------ ---------------
_____ _____ _____
----------------------------------------- ------------ ------------ ---------------
Attributable to:
----------------------------------------- ------------ ------------ ---------------
Owners of the parent 8,686 (360) (5358)
----------------------------------------- ------------ ------------ ---------------
_____ _____ _____
----------------------------------------- ------------ ------------ ---------------
Consolidated Statement Of Financial Position
at 31(st) March 2014
Unaudited Unaudited Audited
31 March 31 March 30 September
2014 2013 2013
GBP'000 GBP'000 GBP'000
----------------------------------- ------------ ------------ ---------------
Non-current assets
----------------------------------- ------------ ------------ ---------------
Investments 10,000 - -
----------------------------------- ------------ ------------ ---------------
Interests in associates - 182 250
----------------------------------- ------------ ------------ ---------------
Other financial assets - 800 -
----------------------------------- ------------ ------------ ---------------
_____ _____ _____
----------------------------------- ------------ ------------ ---------------
10,000 982 250
----------------------------------- ------------ ------------ ---------------
_____ _____ _____
----------------------------------- ------------ ------------ ---------------
Current assets
----------------------------------- ------------ ------------ ---------------
Inventories 475 4,000 475
----------------------------------- ------------ ------------ ---------------
Other financial assets 400 - 400
----------------------------------- ------------ ------------ ---------------
Trade and other receivables 675 377 1,194
----------------------------------- ------------ ------------ ---------------
Cash and bank balances 13 14 58
----------------------------------- ------------ ------------ ---------------
_____ _____ _____
----------------------------------- ------------ ------------ ---------------
1,563 4,391 2,127
----------------------------------- ------------ ------------ ---------------
_____ _____ _____
----------------------------------- ------------ ------------ ---------------
Total assets 11,563 5,373 2,377
----------------------------------- ------------ ------------ ---------------
Current liabilities
----------------------------------- ------------ ------------ ---------------
Trade and other payables (1,413) (515) (1,136)
----------------------------------- ------------ ------------ ---------------
Non-current liabilities
----------------------------------- ------------ ------------ ---------------
Retirement benefit obligation (4.109) (4,001) (4,071)
----------------------------------- ------------ ------------ ---------------
Secured and Unsecured Convertible
loan stock (574) (61) (574)
----------------------------------- ------------ ------------ ---------------
_____ _____ _____
----------------------------------- ------------ ------------ ---------------
Total liabilities (6,096) (4,577) (5,781)
----------------------------------- ------------ ------------ ---------------
_____ _____ _____
----------------------------------- ------------ ------------ ---------------
Net Assets 5,467 796 (3,404)
----------------------------------- ------------ ------------ ---------------
_____ _____ _____
----------------------------------- ------------ ------------ ---------------
Equity
----------------------------------- ------------ ------------ ---------------
Called up share capital 1,450 1,319 1,319
----------------------------------- ------------ ------------ ---------------
Share premium account 9,839 9,839 9,839
----------------------------------- ------------ ------------ ---------------
Other reserve 11,182 10,695 11,182
----------------------------------- ------------ ------------ ---------------
Share based payment reserve 278 180 224
----------------------------------- ------------ ------------ ---------------
Retained earnings (17,282) (21,237) (25,968)
----------------------------------- ------------ ------------ ---------------
_____ _____ _____
----------------------------------- ------------ ------------ ---------------
Total equity 5,467 796 (3,404)
----------------------------------- ------------ ------------ ---------------
_____ _____ _____
----------------------------------- ------------ ------------ ---------------
Consolidated Statement Of Changes in Equity
for the periods to 31(st) March 2014
Share Share Other Share based Retained Total
capital premium Reserve Compensation earnings equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------------------- ---------- ---------- ---------- --------------- ----------- ----------
As at 1 October 2012 1,306 9,839 10,626 166 (20,877) 1,060
-------------------------- ---------- ---------- ---------- --------------- ----------- ----------
Share based compensation - - - 14 - 14
-------------------------- ---------- ---------- ---------- --------------- ----------- ----------
Issue of ordinary shares 13 - - - - 13
-------------------------- ---------- ---------- ---------- --------------- ----------- ----------
Equity component of
loan notes issued 69 - - 69
-------------------------- ---------- ---------- ---------- --------------- ----------- ----------
Total comprehensive
loss for the period - - - - (360) (360)
-------------------------- ---------- ---------- ---------- --------------- ----------- ----------
______ _____ _____ _____ ______ _____
-------------------------- ---------- ---------- ---------- --------------- ----------- ----------
As at 31 March 2013 1,319 9,839 10,695 180 (21,237) 796
-------------------------- ---------- ---------- ---------- --------------- ----------- ----------
Share based compensation - - - 44 - 44
-------------------------- ---------- ---------- ---------- --------------- ----------- ----------
Equity component of
loan notes issued - - 487 - - 487
-------------------------- ---------- ---------- ---------- --------------- ----------- ----------
Total comprehensive
loss for the
period - - - - (4,731) (4,731)
-------------------------- ---------- ---------- ---------- --------------- ----------- ----------
______ _____ _____ _____ ______ _____
-------------------------- ---------- ---------- ---------- --------------- ----------- ----------
As at 30 September
2013 1,319 9,839 11,182 224 (25,968) (3,404)
-------------------------- ---------- ---------- ---------- --------------- ----------- ----------
Issue of ordinary shares 131 - - - - 131
-------------------------- ---------- ---------- ---------- --------------- ----------- ----------
Share based compensation - - - 54 - 54
-------------------------- ---------- ---------- ---------- --------------- ----------- ----------
Total comprehensive
income for the period - - - - 8,686 8,686
-------------------------- ---------- ---------- ---------- --------------- ----------- ----------
______ ______ ______ ______ ______ _____
-------------------------- ---------- ---------- ---------- --------------- ----------- ----------
As at 31 March 2014 1,450 9,839 11,182 278 (17,282) 5,467
-------------------------- ---------- ---------- ---------- --------------- ----------- ----------
______ ______ ______ ______ ______ _____
-------------------------- ---------- ---------- ---------- --------------- ----------- ----------
Consolidated Cash Flow Statement
for the six months ended 31(st) March 2014
Unaudited Unaudited Audited
6 months 6 months 18 months
ended ended ended
31 March 31 March 30 September
2014 2013 2013
GBP'000 GBP'000 GBP'000
----------------------------------------- ------------ ------------ --------------------
Cash flow from operating activities
----------------------------------------- ------------ ------------ --------------------
Operating profit/(loss) for the
period 8,799 (280) (1,098)
----------------------------------------- ------------ ------------ --------------------
Movement in trade and other receivables - (85) (170)
----------------------------------------- ------------ ------------ --------------------
Movement in trade and other payables 122 239 875
----------------------------------------- ------------ ------------ --------------------
Gain on bargain purchase (9,034) - -
----------------------------------------- ------------ ------------ --------------------
Share based payment 54 14 58
----------------------------------------- ------------ ------------ --------------------
Payments to retirement benefit
scheme (41) (57) (172)
----------------------------------------- ------------ ------------ --------------------
_____ _____ _____
----------------------------------------- ------------ ------------ --------------------
(100) (169) (507)
----------------------------------------- ------------ ------------ --------------------
Interest paid on loans (29) - (9)
----------------------------------------- ------------ ------------ --------------------
_____ _____ _____
----------------------------------------- ------------ ------------ --------------------
Net cash outflow from operating
activities (129) (169) (516)
----------------------------------------- ------------ ------------ --------------------
_____ _____ _____
----------------------------------------- ------------ ------------ --------------------
Cash flows from investing activities
----------------------------------------- ------------ ------------ --------------------
Interest received 26 46 84
----------------------------------------- ------------ ------------ --------------------
Loans advanced -- (42)) (341)
----------------------------------------- ------------ ------------ --------------------
Loans repaid - 78 147
----------------------------------------- ------------ ------------ --------------------
____ _____ _____
----------------------------------------- ------------ ------------ --------------------
Net cash generated by/(used in)
investing activities 26 82 (110)
----------------------------------------- ------------ ------------ --------------------
_____ _____ _____
----------------------------------------- ------------ ------------ --------------------
Cash flows from financing activities
----------------------------------------- ------------ ------------ --------------------
Proceeds from inception of new
loans 58 - 149
----------------------------------------- ------------ ------------ --------------------
Proceeds from new shares issued - 13 128
----------------------------------------- ------------ ------------ --------------------
Repayment of convertible loan - (13) -
stock
----------------------------------------- ------------ ------------ --------------------
Proceeds from issue of convertible
loan stock - - 143
----------------------------------------- ------------ ------------ --------------------
____ _____ _____
----------------------------------------- ------------ ------------ --------------------
Net cash generated by financing
activities 58 - 420
----------------------------------------- ------------ ------------ --------------------
_____ _____ _____
----------------------------------------- ------------ ------------ --------------------
Decrease in cash and cash equivalents (45) (87) (206)
----------------------------------------- ------------ ------------ --------------------
Cash and cash equivalents at the
beginning of the period 58 101 264
----------------------------------------- ------------ ------------ --------------------
_____ _____ _____
----------------------------------------- ------------ ------------ --------------------
Cash and cash equivalents at end
of period 13 14 58
----------------------------------------- ------------ ------------ --------------------
_____ _____ _____
----------------------------------------- ------------ ------------ --------------------
Cash and cash equivalents comprise
cash held at bank.
----------------------------------------- ------------ ------------ --------------------
Notes to the Interim Financial Statements for the six months ending 31st March 2014
1. General Information
Worthington Group plc is a company incorporated in the United Kingdom. The Company has its primary listing on the London Stock Exchange.
These condensed interim financial statements were approved for issue on 20(th) August 2014. These interim financial statements do not constitute statutory accounts as defined by section 434 of the Companies Act 2006. Full accounts of the company for the 18 months ended 30(th) September 2013 on which the Auditors gave an unqualified report, will be delivered to the Registrar of Companies in due course.
2. Basis of preparation
These condensed interim financial statements for the 6 months ended 31(st) March 2014 have been prepared in accordance with the Disclosure and Transparency Rules of the Financial Services Authority and with IAS 34 'Interim Financial Reporting' as adopted by the European Union. The interim financial statements should be read in conjunction with the annual financial statements for the 18 months ended 30(th) September 2013, which have been prepared in accordance with IFRS's as adopted by the European Union.
Going Concern
The Company currently meets its day-to-day working capital requirements out of cash balances and the Directors consider the cash balances, together with income generated from its investments and funds committed from investors, are sufficient to meet the Company's needs. In the period, the Company acquired full ownership of Law Financial Ltd (see note 9) which has resulted in the Group having substantial net assets. The trend of the Group is significantly positive with various near term investments, funded by equity and long term loan stock, close to completion which will further improve both the Group's liquidity and balance sheet substantially.
The Company has a long term liability to the Jerome Group Plc Retirement Benefits Plan. The directors have been in active discussions with the Pension Trustee, the Pensions Regulator and the Pension Protection Fund ("PPF") in an attempt to resolve the pension deficit issue. It is envisioned that the pension fund will ultimately enter the PPF. The best mechanism of achieving this is currently under review.
The directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. On this basis, the directors consider it appropriate to prepare the interim financial statements on the going concern basis.
3. Significant accounting policies
The accounting policies adopted in the preparation of the interim financial statements are consistent with those followed in the preparation of the financial statements for the 18 months ended 30(th) September 2013, as described in those financial statements. Any new amended Accounting Standards applicable for the period do not have a significant effect. These accounting policies are expected to be applied for the full year to 30(th) September 2014.
Taxes on income in the interim periods are accrued using the tax rate that would be applicable to expected total annual earnings.
4. Segmental analysis
The company only has one operating segment relating to property rental and management of businesses. Disclosure is in accordance with IAS 34. All operations are continuing and in the UK.
5. Earnings per share
The calculation of basic and diluted earnings per share is based upon the loss for the period and the weighted average number of shares in issue during the period. There is no difference between basic and diluted earnings per share in either period.
Unaudited Unaudited Audited
6 months 6 months 18 months
ended ended ended
31 March 31 March 30 September
2014 2013 2013
No: No: No:
----------------------------------- ----------- ----------- --------------
Weighted average number of shares 13,386,786 12,758,984 12,587,470
----------------------------------- ----------- ----------- --------------
_________ _________ _________
----------------------------------- ----------- ----------- --------------
Earnings/(loss) per share 64.9p (2.8p) (42.0p)
----------------------------------- ----------- ----------- --------------
_____ _____ _____
----------------------------------- ----------- ----------- --------------
6. Share capital
------------------------------ ---------- ---------- -------------
Unaudited Unaudited Audited
------------------------------ ---------- ---------- -------------
31 March 31 March 30 September
------------------------------ ---------- ---------- -------------
2014 2013 2013
------------------------------ ---------- ---------- -------------
GBP'000 GBP'000 GBP'000
------------------------------ ---------- ---------- -------------
Authorised:
------------------------------ ---------- ---------- -------------
New ordinary shares 10p each
------------------------------ ---------- ---------- -------------
52,736,850 5,274 5,274 5,274
------------------------------ ---------- ---------- -------------
_________ _________ _________
------------------------------ ---------- ---------- -------------
Allotted, called up and fully
paid:
------------------------------ ---------- ---------- -------------
New ordinary shares 10p each
------------------------------ ---------- ---------- -------------
14,498,783 1,450 1,319 1,319
------------------------------ ---------- ---------- -------------
_________ _________ _________
------------------------------ ---------- ---------- -------------
On 4(th) March 2014, GBP130,570 of Unsecured Loan Stock 2021 was issued by the Company to fund corporate finance activities. The subscribers to the loan stock elected to convert the loan stock into 1,305,700 ordinary
10p shares on 21(st) March 2014.
As at 31(st) March 2014, options were outstanding in respect of a total of 3,935,671 new ordinary 10p shares
exercisable at a price of 11p. These options are exercisable until 30(th) August 2018.
In addition, warrants to subscribe for 35,090,378 ordinary shares at a price of 5p each, subject to shareholder approval of a share capital re-organisation, are outstanding at 31(st) March 2014. These warrants are
exercisable between 6(th) August 2017 and 6(th) September 2018.
7. Directors' Statement of Responsibilities
The Directors confirm to the best of their knowledge:
-- The condensed set of financial statements has been prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the EU;
-- The interim management report includes a fair review of the information required by DTR 4.2.7R being an indication of important events that have occurred during the first 26 weeks of the financial year and their impact on the condensed set of financial statements and a description of the principal risks and uncertainties for the remaining 26 weeks of the year; and
-- The interim management report includes a fair review of the information required by DTR 4.2.8R being disclosure of related party transactions and changes therein since the last annual report.
By order of the Board - Doug Ware , CEO 20(th) August 2014
8. Related party transactions and post balance sheet events
Included in other financial assets are loan notes of GBP400,000 (31(st) March 2013 - GBP800,000) due from Trimmings by Design Limited an associated company in which the Company had a 44% interest as at 31 March 2014. The loan notes are subject to interest at 6.5% amounting to an interest revenue for the period of GBP26,000 (2013 - GBP26,000) and, as at the period end, there was GBPnil (2013 GBPnil) of unpaid interest within Trade and other receivables. In July 2014 the Company sold its investment in Trimmings By Design Limited for GBP1 and accepted the sum of GBP399,999 in early repayment of GBP800,000 of loan notes not due for repayment until 31(st) December 2200.
On 14(th) April 2014, the Company issued GBP302,400 and GBP24,000 of the unissued Secured Convertible Loan Stock 2019 to European and Asian Ltd (the holding company of Mandolyn Ltd of which Doug Ware is a director) and Richard Spurway, a director, respectively. The consideration for the issue was the cancellation of the remaining notice period on their respective contracts. This was in order to secure the remaining monies due to the respective parties in accordance with their contracts should their roles be terminated and/or their contracts not being honoured for any reason. They have agreed to surrender all the loan stock for nil consideration once an agreement is reached with the Pension Trustee, the Pension Regulator and the PPF. This would enable the re-structuring of the Company with the scheme being transferred into the PPF.
In May 2014, contracts were exchanged for the sale of our Keighley freehold property for GBP475,000. Completion of the sale is due before the end of September 2014.
9. Acquisition
On 16(th) April 2013 the Company acquired a 26% stake in Law Financial Limited ("LFL") for GBP250,000 payable in unsecured convertible loan notes issued by the Company repayable in 2019. Law Financial Ltd is a recently incorporated company with a number of subsidiaries, one of which owns an ongoing legal claim against the assets of Rangers Football Club Limited.
The Company was also granted an option to acquire the remaining share capital of LFL for GBP750,000 which was exercised on 28(th) October 2013.
The Company has now ceased to account for LFL as an associated company from 28(th) October 2013 and LFL has been consolidated as a 100% subsidiary of the Company in these interim financial statements.
At the date of acquisition the directors assessed the fair values of the assets purchased as follows:
Fair value
Book value adjustment Fair value
GBP'000 GBP'000 GBP'000
Investments - legal
claims 10,000 - 10,000
Other receivables 100 - 100
Other payables (66) - (66)
Gain on bargain purchase - (9,034) (9,034)
______ ______ ______
10,034 (9.034) 1,000
______ ______ ______
Settled by: GBP'000
Issue of Unsecured Loan
Notes 1,000
______
Included in the results for the period are losses of GBP60,000 in the period excluding the gain on purchase of a bargain assets of GBP9,034,000.
The fair value of the net assets acquired was GBP10,034,000 which is in excess of the GBP1m cost of acquisition. Accordingly under IFRS the consolidated income statement has been credited with a gain on bargain purchase of GBP9,034,000 in the period and has been included as a separately disclosable item.
10. Availability of Interim Report
A copy of this report in pdf format is available on the company's website at www.worthingtongroupplc.com. Copies of this report are also available from The Secretary, Worthington Group plc, 1 The Green, Richmond, Surrey TW9 1PL.
Enquiries:
PD Cosec Ltd - Company Secretary Tel: +44 208 940 0963
Charlotte Parham, Media information Tel: +44 203 291 1872
or email: media@worthingtongroupplc.com
Website: www.worthingtongroupplc.com
End of interim statement
Financial statement for the 18 months ended 30 September 2013
Chief Executive's Statement
The period ending 30(th) September 2013 has been a difficult but also challenging and interesting time for the Company following my appointment on 1(st) June 2012.
The Company recorded a loss for the period of GBP5,285,000 (2012: loss of GBP625,000). This was largely due to the professional revaluation of our Keighley site investment, review of the value of loan notes not due to be repaid until 2200, write down of value in one of our associated company investments and pension fund costs.
By the period end, our cash balances had reduced to GBP58,000, from GBP264,000 in 2012. Unfortunately, for actuarial reasons, the Pension Scheme deficit increased from GBP3,993,000 in 2012 to GBP4,071,000 at the end of the period. As previously reported, the pension scheme deficit has continued to represent the principal risk factor faced by the Company. The Company currently pays contributions of GBP119,000 per annum into the Pension Scheme, plus 20% of any pre-tax profits made in the year. Because of the increase in the deficit, and following the latest tri-annual valuation, the annual contributions are likely to more than treble in the very near future. The Company also pays the annual PPF levy previously borne by the Scheme, this was GBP61,185 in the period to 30(th) September 2013 (2012: nil). The Company is also liable for the qualifying costs of the scheme. Clearly, with all these spiralling Pension costs which are not under the Company's control, a solution has to be found. Over the last eighteen months, the Company has been in close contact with the Pension Trustee and the Pensions Regulator with a view to reaching a compromise over the deficit. It is envisaged that the Pension Scheme will ultimately go into the Pension Protection Fund. The best way of achieving this is still under review but we are optimistic that a resolution will be achieved very shortly. We continue to monitor closely the performance of the Scheme's investments which total GBP7.3m (2012: GBP7.9m). Legal proceedings are ongoing with regard to the Pension Fund's uncompleted secured loan of GBP3m to Rangers Football Club. Our legal team are confident that the GBP3m will be recovered, plus interest & costs.
Because of the uncertainty of the value of the Keighley site following the abortive multi use planning application, a professional valuation of the site was sought from Mazars LLP as at 1(st) June 2012. Because of the costs involved in completing a residential development, including charges levied by the local authority & taking the economic climate into account, the Mazars' valuation came in at GBP500,000. If any settlement was to be possible with the Pension Trustee, there would have to be a substantial cash element to it. The Board therefore decided to sell the Keighley site and contracts were exchanged in May 2014 for the sale of the site for GBP475,000. Completion of the sale is due before the end of September.
Trimmings by Design ("TBD") is an associated company, in which the Company holds a 44% shareholding and also has a seat on the Board. During the period, the Company received management charges from TBD for GBP261,250 (2012: dividend of GBP44,000). Because of the need for liquid funds to satisfy any Pension compromise, the Board opened negotiations for the sale of the Company's shareholding in TBD to the existing TBD director/shareholders. I am pleased to confirm that agreement was reached, and a sale completed in July 2014, the total value of the transaction was GBP515,000.
In April 2013, the Company acquired a 26% shareholding in Law Financial Ltd for a consideration of GBP250,000, satisfied by the release to the vendors of GBP250,000 of unsecured convertible loan notes. The Company had an option to purchase the remaining 74% of Law Financial Ltd, this option was exercised in October 2013, satisfied by the release to the vendors of a further GBP750,000 of unsecured convertible loan notes. Law Financial has a number of substantial legal claims and is the first investment that Worthington has made in the legal claims market; we plan to make further investments in the legal claims and litigation funding market over the coming year.
Having spent the last 18 months reviewing the company's existing portfolio; considering how best to maximise or realise investments; taking positive steps to eliminate the company's pension deficit; and providing firm foundations for the company's future growth and development by identifying and negotiating new investment opportunities with the potential for outstanding shareholder returns, I am pleased to be able to say that I believe the current year will prove to be an exciting new phase in the company's development as we celebrate 60 years on the main market of the London Stock Exchange.
I'm particularly excited about the opportunities for substantial acquisitions in emerging markets where we can use our main market London listed paper as currency to acquire exceptional assets with impressive growth profiles. I believe that a good spread of these assets in different international locations also provides important risk management safeguards.
We continue to progress negotiations with the new investments and are confident that we will be able to report positive outcomes in the near future.
I would like to thank our shareholders for the tremendous support we have received during the period as we have evolved from a relatively sleepy investment company into a more dynamic investment business. Our new website reflects the increased vitality and energy that we are bringing to sourcing, negotiating and executing our new investment opportunities. I look forward to the rest of 2014 with considerable optimism.
Doug Ware, Chief Executive
20 August 2014
Income Statement
for the 18 months ended 30
September 2013
Total Total
18 months 12 months
ended ended
30 Sept 31 March
2013 2012
Note GBP'000 GBP'000
Revenue 2 264 43
Cost of sales (41) (115)
_________ _________
Gross profit/(loss) 223 (72)
Administrative expenses (588) (165)
Share based payment (58) (166)
Pension scheme related expenses (675) (235)
_________ _________
Operating loss (1,098) (638)
Investment revenues 3 125 87
Investment property write down 4 (3,525) -
Investments in associate write
down 5 (638) -
Pension finance costs 6 (237) (101)
Interest payable (9) -
Share of results of associate 7 97 27
_________ _________
Loss before taxation (5,285) (625)
Taxation 8 - -
_________ _________
Loss after taxation for period (5,285) (625)
_________ _________
Loss per ordinary share from
continuing operations
- Basic 9 (42.0p) (5.3p)
-Fully diluted 9 N/A N/A
All items are derived from continuing operations.
Throughout this announcement all references for the current period of 2013 refer to the 18 months ended 30(th) September 2013. All references for 2012 refer to the 12 months ended 31th March 2012.
Statement of Comprehensive Income
For the 18 months ended 30 September
2013
2013 2012
GBP GBP
Loss for the period (5,285) (625)
Actuarial loss on retirement benefit
obligation (73) (979)
_______ _______
Total comprehensive loss for the period (5,358) (1,604)
_______ _______
Attributable to:
Owners of the parent (5,358) (1,604)
_______ _______
Statement of Financial Position
As at 30 September 2013 and 31
March 2012
2013 2013 2012 2012
GBP'000 GBP'000 GBP'000 GBP'000
Non-current assets
Interests in associates 250 140
Other financial assets - 800
_____ _-___
250 940
Current assets
Inventories 475 4,000
Other financial assets 400 -
Trade and other receivables 1,194 34
Cash and bank balances 58 264
_____ _-___
2,127 4,298
_____ _____
Total assets 2,377 5,238
Current liabilities
Trade and other payables 1,136 106
_____ _____
1,136 106
_____ _____
Non-current liabilities
Retirement benefit obligation 4,071 3,933
Secured and Unsecured convertible 574 -
loan stock _____ _____
4,645 3,933
_____ _____
Total liabilities (5,781) (4,039)
_____ _____
Net assets (3,404) 1,199
_____ _____
Equity
Called-up share capital 1,319 1,181
Share premium account 9,839 9,836
Other reserves 11,182 10,626
Share based payment 224 166
Retained earnings (25,968) (20,610)
_____ _____
Total equity (3,404) 1,199
_____ _____
Changes in Equity
For the 18 months ended 30
September 2013
Share
Share Share Other Based Retained
Capital Premium Reserve Payment Earnings Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 April 2011 1,181 9,836 10,626 - (19,006) 2,637
Share based payment - - - 166 - 166
Total comprehensive
loss for the year - - - - (1,604) (1,604)
_____ _____ _____ _____ _____ _____
At 31 March 2012 1,181 9,836 10,626 166 (20,610) 1,199
Shares issued in period 138 3 - - - 141
Share based compensation - - - 58 - 58
Equity component on
issue of loan notes - - 556 - - 556
Total comprehensive
loss for the period - - - - (5,358) (5,358)
_____ _____ _____ _____ _____ _____
Balance as at 30 September
2013 1,319 9,839 11,182 224 (25,968) (3,404)
_____ _____ _____ _____ _____ _____
Cash Flow Statement
for the 18 months ended 30 September 2013
2013 2012
GBP'000 GBP'000
Cash flow from operating activities
Operating loss (1,098) (638)
Movement in trade and other receivables (170) 99
Movement in trade and other payables 875 (102)
Share based payment 58 166
(Payments to)/receipts from pension scheme (172) 11
_____ _____
(507) (464)
Interest paid on loans (9) -
_____ _____
Net cash outflow from operating activities (516) (464)
Cash flows from investing activities
Interest received 84 87
Dividends received - 44
Loans advanced (341) -
Loans repaid 147 350
_____ _____
Net cash (used)/generated by investing
activities (110) 481
Cash flows from financing activities
Proceeds from inception of new loans 149 -
Proceeds from new shares issued 128 -
Proceeds from issue of Convertible Loan 143 -
Stock
_____ _____
Net cash generated by financing activities 420 -
(Decrease)/increase in cash and cash equivalents (206) 17
Opening cash and cash equivalents 264 247
_____ _____
Closing cash and cash equivalents 58 264
_____ _____
Notes forming part of the preliminary announcement for the period ended 30(th) September 2013.
1. Basis of preparation
Worthington Group plc is a company incorporated in the United Kingdom. The Company has its primary listing on the London Stock Exchange.
The financial statements of the Company have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union.
The financial information in this announcement, which was approved by the Board of Directors on 20 August 2014, does not constitute the Company's statutory accounts for the 18 months ending 30(th) September 2013 or year ended 31(st) March 2012, but is derived from these accounts.
Statutory accounts for the year ended 31(st) March 2012 have been delivered to the Registrar of Companies and those for the 18 months ended 30(th) September 2013 will be delivered following the Company's annual general meeting. The auditors have reported on these accounts; their reports were unqualified and did not contain statements under S498 of the Companies Act 2006.
The financial information has been prepared on the historical cost basis, except for the revaluation of certain properties and assets.The principle accounting policies applied in the preparation of the consolidated financial statements are consistent with those set out in the statutory accounts for the year ended 31(st) March 2012.
2. Operating segments
The Company has adopted IFRS 8 with effect from 1(st) April 2009. IFRS 8 requires operating segments to be identified on the basis of internal reports about components of the Company that are regularly reviewed by the Chief Executive to allocate resources and assess performance.
As a result, following adoption of IFRS 8, the Company's only reportable segment remains property rental and management in the UK.
3. Investment Revenues
2013 2012
GBP'000 GBP'000
Loan note interest 78 52
Interest and arrangement fees on loans
made 47 35
_____ _____
125 87
_____ _____
4. Investment property write down 2013 2012
GBP'000 GBP'000
Write down in the value of inventories 3,525 -
_____ _____
During the period, land at Keighley previously included in the balance sheet at the director's valuation of GBP4m has been valued by Mazars LLP at GBP500,000. The reason given for this is because of the costs involved, including local authority charges, in completing a residential development, the economic climate is also a determining factor. Following receipt of a contamination report, the value of the site has been further written down to GBP475,000. In May 2014, contracts were exchanged for the sale of this freehold property for GBP475,000, completion of the sale is due before the end of September 2014.
5. Investment in associates write down 2013 2012
GBP'000 GBP'000
Interest in associate write down 638 -
_____ _____
In July 2014 the Company sold its investment in Trimmings By Design Limited for GBP1 and accepted the sum of GBP399,999 in early repayment of GBP800,000 of loan notes not due for repayment until 31(st) December 2200.
Accordingly a write down of the Company's investment in Trimmings By Design together with the carrying value of the loan notes has been made amounting to GBP638,000.
6. Pension Finance Costs
2013 2012
GBP'000 GBP'000
Pension scheme net finance charge 237 101
_____ _____
7. Share of results of associates
2013 2012
GBP'000 GBP'000
Share of profits after tax 131 48
Associates' net finance costs (34) (21)
_____ _____
97 27
_____ _____
8. Taxation
No corporation charge has been provided for the 18 months ended 30(th) September 2013 or year ended 31(st) March 2012 as a result of the availability of various reliefs.
9. Loss per share
The earnings per share has been calculated using the weighted average number of ordinary shares in issue during the relevant financial periods. The weighted average number of shares in issue during the period were 12,587,470 (2012: 11,807,014) and the loss after taxation was GBP5,285,000 (2012: GBP625,000).
There is no difference between the basic and diluted losses per share in either period.
10. Convertible Loan stock
In November 2012 the Company approved the issue of up to GBP475,000 of Secured Convertible Loan Stock ("SCLS 2019") secured on the Company's assets. The loan notes do not bear interest and the holders of each 10p of SCLS2019 loan stock received bonus warrants entitling them to subscribe for 2 ordinary shares in the Company to the value of the SCLS at a price of 5p per share within 5 years of their issue. The exercise price is subject to shareholder approval of a capital reorganisation to be undertaken reducing the par value of the Company's ordinary shares to 5p or below. The SCLS 2019 loan notes are redeemable on 26(th) November 2019.
During the period, GBP143,125 of Secured Convertible Loan Stock ("SCLS 2019") was issued and GBP13,606.90 of the SCLS 2019 was converted by holders into 136,069 ordinary 10p shares of the Company.
In accordance with IAS 39 the directors have calculated the net present values of the cash flows in respect of the principal payments over the life of the loans at a rate of 10% which the directors consider would have been the interest payable on a bank loan without the convertible element. Accordingly the SCLS 2019 loan notes are recorded as a financial liability of GBP61,037 as at 30(th) September 2013. An equity reserve has been created being the difference in value of the loan at inception and the GBP143,125 issue value, representing the equity element of the instrument.
On 16(th) April 2013, the Company issued GBP1m of Unsecured Convertible Loan Stock 2020. The loan notes do not bear interest and the holders of each 10p of the unsecured convertible loan stock received warrants entitling them to subscribe for 2 ordinary shares in the Company at a price of 5p per share within 5 years of their issue. The exercise price of 5p is subject to shareholder approval of a capital reorganisation to be undertaken reducing the par value of the Company's ordinary shares to 5p or below. The loan notes are redeemable on 16(th) April 2020.
In accordance with IAS 39 the directors have calculated the net present values of the cash flows in respect of the principal payments over the life of the loans at a rate of 10% which the directors consider would have been the interest payable on a bank loan without the convertible element. Accordingly the loan notes are recorded as a financial liability of GBP512,890 as at 30(th) September 2013. An equity reserve has been created being the difference in value of the loan at inception and the GBP487,110 issue value, representing the equity element of the instrument.
11. Share Capital
On the 9(th) July 2012 the directors issued 350,000 new ordinary 10p shares at 10.45p each raising proceeds of GBP36,575 before costs for the Company. On 6(th) August 2012 the directors issued a further 900,000 new ordinary 10p shares at 10.2p each raising proceeds of GBP91,800 before costs for the Company.
The Company issued GBP143,125 of Secured Loan Stock 2019 during the period and holders of GBP13,606.90 of the loan stock elected to convert these into 136,069 new ordinary 10p shares.
As at 30(th) September 2013 and the date of this announcement share options were outstanding in respect of a total of 3,935,671 new ordinary 10p shares exercisable at a price of 11p. These options are exercisable until 30(th) August 2018.
At 30(th) September 2013 there were 35,090,378 warrants outstanding in respect of ordinary shares in the Company (2012: nil).
The subscribers to the ordinary shares placed in August 2012 received 2,500,000 warrants to subscribe for new ordinary shares at 5p each.
In January 2013, subscribers to the Secured Loan Stock 2019 received 2,590,378 warrants to subscribe for new ordinary shares at 5p each.
In April 2013 subscribers of the GBP1m unsecured loan stock 2020 also received 20,000,000 warrants to subscribe for new ordinary shares at 5p each.
On 6(th) September 2013, 8,000,000 warrants to subscribe for ordinary shares at 5p each were issued to European and Asian Ltd the holding company of Mandolyn Ltd (of which D Ware is a director ). A further 2,000,000 warrants to subscribe for ordinary shares at 5p each were issued to Richard Spurway a director in the Company.
The exercise price of 5p applying to all the above warrants are subject to shareholders' approval of a capital re-organisation to reduce the par value of the Company's ordinary shares to 5p or below, they are valid for a period of 5 years from the date of issue.
All warrants and convertible loan stock are only exercisable, or convertible, to the extent that the holder, following exercise or conversion, either alone or in concert, does not hold more than 29.9% of the issued voting capital of the Company.
12. Related party transactions
During the period, the sum of GBP93,600 including VAT (2012: GBPnil) was paid to Mandolyn Limited for the services in respect of Doug Ware. Doug Ware is a director of Mandolyn Ltd. In addition, during the period, loans totalling GBP36,500 (2012: GBPnil) were advanced to the Company by Mandolyn Ltd, these loans were fully repaid as at 30(th) September 2013. The Company was not charged any interest by Mandolyn Ltd on these loan amounts.
During the period, the sum of GBP5,000 (2012: GBP5,000) was paid to Richmond Corporate Developments Limited for the services in respect of former director Anthony Cooke.
Included in other financial assets are loan notes of GBP399,999 (2012: GBP800,000) due from Trimmings by Design Limited an associated company in which the Company has a 44% interest. The loan notes are subject to interest at 6.5% amounting to an interest revenue for the period of GBP78,000 (2012: GBP52,000) and, as at the period end, there was GBPnil (2011: GBP13,000) of unpaid interest within Trade and other receivables.
13. Post balance sheet events
On 16(th) April 2013, the Company acquired 26% of the shares in Law Financial Ltd in exchange for GBP250,000 of Unsecured Convertible Loan stock 2020, with an option to acquire the remaining 74% of the shares by 31(st) October 2013. This option was exercised on 28(th) October 2013 and the remaining shares were acquired in exchange for GBP750,000 of Unsecured Convertible Loan Stock 2020. The Unsecured Loan Stock 2020 includes warrants to subscribe for 20m ordinary shares in the Company at an exercise price of 5p each , subject to a share capital re-organisation being approved by shareholders.
On 4(th) March 2014, in order to fund corporate finance activities, the Company issued GBP130,570 of Unsecured Convertible Loan Stock 2021 which was subsequently converted into 1,305,700 ordinary 10p shares in the Company on 21(st) March 2014.
On 14(th) April 2014, the Company issued GBP302,400 and GBP24,000 of the unissued Secured Convertible Loan Stock 2019 to European and Asian Ltd (the holding company of Mandolyn Ltd of which Doug Ware is a director) and Richard Spurway, a director, respectively. The consideration for the issue was the cancellation of the remaining notice period on their respective contracts. This was in order to secure the remaining monies due to the respective parties in accordance with their contracts should their roles be terminated and/or their contracts not being honoured for any reason. They have agreed to surrender all the loan stock for nil consideration once an agreement is reached with the Pension Trustee, the Pension Regulator and the PPF. This would enable the re-structuring of the Company with the scheme being transferred into the PPF.
In May 2014, contracts were exchanged for the sale of our Keighley freehold property for GBP475,000. Completion of the sale is due before the end of September 2014.
14. Statement of Directors' responsibilities
Each of the Directors confirms that to the best of their knowledge:
1. The financial statements within the full Annual Report and Accounts from which the financial information within this Final Results announcement has been extracted, have been prepared in accordance with IFRSs as adopted by the EU, give a true and fair view of the assets, liabilities, financial position and profit of the Company; and
2. The management report, which is incorporated into the Directors' Report, includes a fair review of the development and performance of the business and the position of the Company taken as a whole, together with a description of the principal risks and uncertainties.
15. Copies of the Annual Report
Copies of the Annual Report will be available from the Company Secretary at the registered office which is situated at 1 The Green, Richmond, Surrey TW9 1PL. The annual report and AGM notices will also be available for download on the Company's website www.worthingtongroupplc.com.
Enquiries: PD Cosec Ltd - Company Secretary Tel: +44 208 940 0963 Charlotte Parham, Media information Tel: +44 203 291 1872 or email: media@worthingtongroupplc.com Website: www.worthingtongroupplc.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
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