TIDMADE
RNS Number : 5473D
ADDleisure PLC
03 December 2009
ADDleisure Plc / Epic: ADE.L / Index: AIM / Sector: Leisure
3 December 2009
ADDleisure Plc ('ADDleisure' or 'the Company')
Interim Results for the six months ended 30 June 2009
ADDleisure Plc, the AIM traded company formed to develop products and services
in the health and leisure sectors, announces its results for the six months
ended 30 June 2009.
Chairman's Statement
We have made some difficult decisions during and post period end, placing two of
our trading subsidiaries into administration and refocusing the business solely
on Fitbug, which we believe offers considerable scope for growth. As part of
this process, we have also refinanced the business post period end and recently
completed a placing to raise approximately GBP1.2 million of new money.
During and post period end, Fitbug has taken some major steps forward:
establishing a new software platform, developing its own proprietary hardware,
signing a number of new partnerships with blue-chip clients including Nectar,
Yorbody, and the Vitality Group, in addition to securing tenders within the
lucrative public health arena having developed special weight loss management
programmes for Primary Care Trusts ('PCTs'). It has also developed its direct
consumer sales channels through its own website, fitbug.com, as well as other
retailers including Amazon and WH Smith.
Looking forward, Fitbug has an exciting pipeline of new business opportunities
both in the UK and internationally, which the Company anticipates will see the
business grow through 2010 and beyond.
Continuing Operations
Fitbug offers online personal health and well-being services by combining
interactive tracking devices and web technology to measure activity and health
indicators, provide feedback and motivate the user towards a healthier
lifestyle. The service is in a position to capitalise on its first-mover
advantage, which has already led to a significant presence in the health
insurance sector, with increasing efforts being placed on the public health
arena and workplace health. It is mainly focussed on the corporate wellness and
health insurance sectors, with increasing effort being placed on the public
health arena.
In the UK, Fitbug's growth continues to gain momentum. It extended its contract
with PruHealth and broke into the PCT arena having formed agreements with
various PCTs across the UK. Post-period end it also signed a contract with
Nectar, the UK's leading coalition loyalty programme, to provide a white
labelled version of the Fitbug product which will reward collectors of Nectar
points for living a healthy lifestyle. This service is due to be launched at the
beginning of 2010.
Internationally, Fitbug is extending its geographic reach through various
partnership agreements including The Vitality Group in the USA, a member of
South Africa-based Discovery Holdings Limited and developer of the world's
longest-standing health enhancement programme. On a much larger scale, Fitbug
is in advanced negotiations with a major US insurance company which could see
Fitbug generate significant revenues which would materially impact the Group's
financial performance in 2010 and onwards. Whilst the Directors are confident
that these negotiations can be successfully concluded in the near term, there
can be no guarantee that any such contract will be signed.
Fitbug remains dedicated to improving and increasing the functionality of its
service, and in line with this, a new model 'Bug' was launched in August 2009.
This new device is not only smaller and slimmer than its predecessor, but it
offers enhanced functionality that will allow members to get more from their
Fitbug programme. In particular, the new Bug, which uses accurate acceleration
sensor technology, will:
* Measure speed, which allows us to monitor exercise intensity;
* Calculate calorie burn accurately based on speed, which is key to our 'energy
balance' approach; and
* Record 'active time' which allows us to show users precisely how long in any
24-hour period they are up on their feet, or indeed sitting down!
In parallel, we are close to completing a new technology platform, which we
anticipate launching in January 2010, designed to give fitbug.com superior site
performance, scalability and internationalisation capabilities, whilst offering
users numerous enhanced areas of functionality.
Additionally, we are exploring future applications and platforms for Fitbug's
accelerometer technology. With the increasing number of functions that mobile
phones and other hand-held technology offer, there is obviously scope for Fitbug
to assist its users through new channels and devices.
Discontinued Operations
In order to focus the team's energies on developing Fitbug, which the Directors
believe will deliver substantial value to shareholders, the Company decided to
divest its non-core assets. This process included placing Movers & Shapers
Limited into administration in April 2009, along with its parent company
ADDWellness Holdings Limited, which was a 50% subsidiary of ADDleisure. Whilst
the Directors believed that the concept could, in the longer term, offer
attractive growth prospects, the difficult market conditions, as well as the
capital required to roll-out the concept meant we could no longer justify the
high costs involved.
Additionally, post period end, in October 2009, the Company's 50.2% owned
subsidiary, Ez-Runner, also entered into administration.
Unfortunately, Ez-Runner did not deliver on its business objectives - its
pipeline of new business opportunities had been slow to advance and existing
contracts had taken longer to complete than anticipated The Board believes
that ADDleisure will receive significantly higher returns on investment by
focusing resources on Fitbug.
Board Changes
During the period and post period end, there have been a number of changes to
the Board. In October 2009, Andrew Brummer, who has been Finance Director
designate and Financial Controller since May 2009, joined the Board as Finance
Director, replacing Mike Mills, who has retired but remains a consultant to the
Company. Paul Landau, the driving force behind the Fitbug concept and its
Managing Director, has also joined the Board.
Michael Warshaw, a Non-executive Director, resigned from the Board in February
2009 but remains as a shareholder and consultant to the Company. Stephen
Flanagan resigned as a Director in July 2009, having been promoted within Bupa
and decided that he could no longer devote the required time to his position
within ADDleisure. Finally, David Cummin stepped down from the Board in October
2009, following the placement of Ez-Runner into administration.
Financial Review
The results for the six months to 30 June 2009 show revenue of GBP1,481,000
(2008: GBP697,000) and pre-tax profit of GBP18,000 after a gain of GBP878,000 in
the relation to the disposal of discontinued operations (2008 loss:
GBP1,812,000). At the end of the period, the Group's cash position was
GBP294,000 (2008: GBP3,100,000).
To facilitate the growth of Fitbug, the Company raised by way of a placing in
December 2009, approximately GBP1.2 million of new money. However, in order to
accommodate the short term cash flow requirements of the Company, Allan Fisher,
David Turner and Pantheon Leisure Plc made available in two tranches, GBP300,000
to Fitbug Limited by way of interest free bridging finance which has now been
converted into equity as part of the placing.
Outlook
After some years of development, Fitbug has now reached the point where it can
begin to realise fully its potential and we anticipate seeing the business
strengthen from its already well established position in the market. Not only is
Fitbug gaining recognition and traction in the UK, but its international profile
is also increasing, as highlighted by the exciting pipeline of new business
opportunities. For the reasons outlined above, I am confident of the Company's
growth prospects.
Allan Fisher
Chairman
3 December 2009
Unaudited Consolidated Income Statement
For the six months ended 30 June 2009
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| | | Six months | Six months | 17 Months Ended 31 |
| | | ended 30 June | Ended 30 June | December 2008 |
| | | 2009 | 2008 | |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| | Note | GBP'000 | GBP'000 | GBP'000 |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| | | | | |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| | | Unaudited | Restated | Restated Audited |
| | | | Unaudited | |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| | | | | |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| Revenue | | 1,481 | 697 | 2,427 |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| Cost of sales | | (258) | (238) | (589) |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| | | ------------ | ------------ | ------------ |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| Gross profit | | 1,223 | 459 | 1,838 |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| Operating and administrative expenses | | (1,863) | (1,843) | (4,482) |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| | | ------------ | ------------ | ------------ |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| Loss from operations | | (640) | (1,384) | (2,644) |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| Finance income | | 69 | 116 | 218 |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| Finance expenses | | (132) | (33) | (72) |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| | | ------------ | ------------ | ------------ |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| Loss before tax | | (703) | (1,301) | (2,498) |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| Income tax credit | | 2 | - | 40 |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| | | ------------ | ------------ | ------------ |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| Loss for the period from continuing operations | | (701) | (1,301) | (2,458) |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| | | | | |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| Profit for the period from discontinued operations | | 719 | (511) | (3,495) |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| | | ------------ | ------------ | ------------ |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| Profit for the period and total comprehensive income | | 18 | (1,812) | (5,953) |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| | | ------------ | ------------ | ------------ |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| | | | | |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| Total comprehensive income attributable to: | | | | |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| Owners of the parent | | 405 | (1,554) | (5,317) |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| Non-controlling interest | | (387) | (258) | (636) |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| | | ------------ | ------------ | ------------ |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| | | 18 | (1,812) | (5,953) |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| | | ------------ | ------------ | ------------ |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| Earnings per share | | | | |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| Basic and diluted earnings per share attributable to | | 0.2 | (0.8) | (2.6) |
| the equity holders of the parent in pence | 3 | | | |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| Basic and diluted earnings per share attributable to | | (0.2) | (0.1) | (0.3) |
| continuing operations in pence | 3 | | | |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
| | | ------------ | ------------ | ------------ |
+--------------------------------------------------------+--------+---------------+---------------+---------------------+
Consolidated Statement of Changes in Equity
For the six months ended 30 June 2009
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| | Share | Share | Merger | Excess of | Retained | Total |
| | capital | premium | reserve | minority interest | deficit | equity |
| | | | | in losses over | | |
| | | | | their equity | | |
| | | | | interest in | | |
| | | | | subsidiaries | | |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| | | | | | | |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| Balance at 1 January 2008 | 1,045 | 4,717 | 1,319 | (488) | (1,110) | 5,483 |
| (unaudited) | | | | | | |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| | | | | | | |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| Total comprehensive income for | - | - | - | (258) | (1,554) | (1,812) |
| the period | | | | | | |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| Share based payment | - | - | - | - | 45 | 45 |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| Issue of shares for cash | 3 | 32 | - | - | - | 35 |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| | ---------- | ------------ | ----------- | ------------ | ------------ | ------------ |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| Balance at 30 June 2008 | 1,048 | 4,749 | 1,319 | (746) | (2,619) | 3,751 |
| (unaudited) | | | | | | |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| | | | | | | |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| Total comprehensive income for | - | - | - | (52) | (3,947) | (3,999) |
| the period | | | | | | |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| Adjustment to minority interest | - | - | - | - | - | - |
| due to change in percentage | | | | | | |
| ownership | | | | | | |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| Share based payment | - | - | - | - | 130 | 130 |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| Exercise of warrants | - | - | - | - | - | - |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| | -------- | ----------- | --------- | ------------ | ----------- | ------------ |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| Balance at 31 December 2008 | 1,048 | 4,749 | 1,319 | (798) | (6,436) | (118) |
| (audited) | | | | | | |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| | | | | | | |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| Total comprehensive income for | - | - | - | (44) | 62 | 18 |
| the period | | | | | | |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| Adjustment to minority interest | - | - | - | (343) | 343 | - |
| due to change in percentage | | | | | | |
| ownership | | | | | | |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| Share based payment | - | - | - | - | 45 | 45 |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| Issue of shares for cash | - | - | - | - | - | - |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| | -------- | ----------- | --------- | ------------ | ----------- | ------------ |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| Balance at 30 June 2009 | 1,048 | 4,749 | 1,319 | (1,185) | (5,986) | (55) |
| (unaudited) | | | | | | |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| | -------- | ----------- | --------- | ------------ | ----------- | ------------ |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
| | | | | | | |
+---------------------------------+------------+--------------+-------------+-------------------+--------------+--------------+
Consolidated Balance Sheet
As at 30 June 2009
+----------------------------------------------------------------+---------------+---------------+-------------------+
| | Six months | Six months | 17 Months Ended |
| | ended 30 June | Ended 30 June | 31 December 2008 |
| | 2009 | 2008 | |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| | GBP'000 | GBP'000 | GBP'000 |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| | Unaudited | Unaudited | Audited |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Assets | | | |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Non-current assets | | | |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Property, plant and equipment | 86 | 260 | 131 |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Intangible assets | 1,360 | 10 | 928 |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| | ------------ | ------------ | ------------ |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Total non-current assets | 1,446 | 270 | 1,059 |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| | ------------ | ------------ | ------------ |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Current assets | | | |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Inventories | 81 | 88 | 58 |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Trade and other receivables | 1,388 | 1,644 | 961 |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Cash and cash equivalents | 294 | 3,100 | 880 |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| | ------------ | ------------ | ------------ |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Total current assets | 1,763 | 4,832 | 1,899 |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| | ------------ | ------------ | ------------ |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Total assets | 3,209 | 5,102 | 2,958 |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| | ------------ | ------------ | ------------ |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Liabilities | | | |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Non-current liabilities | | | |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Borrowings | (1,125) | (157) | (161) |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Contingent consideration | (693) | - | (666) |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| | ------------ | ------------ | ------------ |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Total non-current liabilities | (1,818) | (157) | (827) |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| | ------------ | ------------ | ------------ |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Current liabilities | | | |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Trade and other payables | (1,446) | (1,194) | (2,099) |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Borrowings | - | - | (150) |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| | ------------ | ------------ | ------------ |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Total current liabilities | (1,446) | (1,194) | (2,249) |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| | ------------ | ------------ | ------------ |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Total liabilities | (3,264) | (1,351) | (3,076) |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| | ------------ | ------------ | ------------ |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Total net (liabilities)/assets | (55) | 3,751 | (118) |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| | ------------ | ------------ | ------------ |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Capital and reserves attributable to equity holders of the | | | |
| company | | | |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Share capital | 1,048 | 1,048 | 1,048 |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Share premium reserve | 4,749 | 4,749 | 4,749 |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Merger reserve | 1,319 | 1,319 | 1,319 |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Excess of minorities interest in losses over their equity | (1,185) | (746) | (798) |
| interest in subsidiaries | | | |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Retained deficit | (5,986) | (2,619) | (6,436) |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| | ------------ | ------------ | ------------ |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| Total equity | (55) | 3,751 | (118) |
+----------------------------------------------------------------+---------------+---------------+-------------------+
| | ------------ | ------------ | ------------ |
+----------------------------------------------------------------+---------------+---------------+-------------------+
Consolidated Cash Flow Statement
For the six months ended 30 June 2009
+----------------------------------------------------------------+--------------+-------------+--------------------+
| | Six months | Six months | 17 Months ended 31 |
| | ended 30 | ended 30 | December |
| | June 2009 | June | 2008 |
| | | 2008 | |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| | GBP'000 | GBP'000 | GBP'000 |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| | | | |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| Cash flows from operating activities | | | |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| Profit/(loss) before taxation | 18 | (1,812) | (5,953) |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| Adjustments for: | | | |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| - Depreciation and amortisation | 45 | 151 | 160 |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| - Impairment charge | - | 595 | 1,118 |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| - Share-based payments | 45 | 45 | 130 |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| - Finance income | (69) | (116) | (300) |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| - Finance expense | 132 | 33 | 73 |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| - Income tax credit | (2) | - | (46) |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| | ------------ | ----------- | ------------ |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| Cash flows from operating activities before changes in working | 169 | (1,104) | (4,818) |
| capital and provisions | | | |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| - Decrease/(increase) in inventories | 53 | (49) | (38) |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| - (Increase)/decrease in trade and other receivables | (140) | (155) | 671 |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| - (Decrease)/increase in trade and other payables | (1,736) | 326 | 989 |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| | ----------- | ----------- | ------------ |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| Cash flow from operating activities | (1,654) | (982) | (3,196) |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| Corporation tax credit received | 2 | - | 46 |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| | ----------- | ----------- | ------------ |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| Net cash used in operations | (1,652) | (982) | (3,150) |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| | ----------- | ----------- | ------------ |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| Cash flow from investing activities | | | |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| Purchase of property, plant and equipment | - | (158) | (593) |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| Acquisition of subsidiary | - | - | (583) |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| Cash acquired from acquisition of subsidiary | 228 | - | 293 |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| Development costs | (97) | - | - |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| Finance income | 69 | 116 | 300 |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| | ----------- | ----------- | ------------ |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| Net cash used in investing activities | 200 | (42) | (583) |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| | ----------- | ----------- | ------------ |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| Cash flow from financing activities | | | |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| Issue of ordinary shares for cash | - | 35 | 337 |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| Loan proceeds | 1,000 | - | - |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| Capital repayments of finance lease obligations | (20) | (33) | (7) |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| Finance expense | (105) | (33) | (18) |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| | ----------- | ----------- | ------------ |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| Net cash generated from financing activities | 875 | (31) | 312 |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| | ----------- | ----------- | ------------ |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| Net decrease in cash and cash equivalents | (577) | (1,055) | (3,421) |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| | | | |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| Cash and cash equivalents at beginning of period | 871 | 4,155 | 4,292 |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| | ----------- | ----------- | ------------ |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| Cash and cash equivalents at end of period | 294 | 3,100 | 871 |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| | ----------- | ----------- | ------------ |
+----------------------------------------------------------------+--------------+-------------+--------------------+
| | | | |
+----------------------------------------------------------------+--------------+-------------+--------------------+
Unaudited notes forming part of the consolidated interim financial statements
For the six months ended 30 June 2009
1. Accounting policies
Basis of preparation
Except as described below, the accounting policies adopted are consistent with
those which will be applied in preparing the group's financial statements for
the year ended 31 December 2009.
The following new standards, amendments to standards and interpretations have
been adopted by ADDleisure Plc for the first time for the financial period ended
30 June 2009:
* International Accounting Standard 1: Presentation of financial statements (IAS
1) (revised 2008) replaces IAS 1 (revised 2005) and is effective for financial
periods beginning on or after 1 January 2009. This standard requires the Group
to introduce the concept of 'total comprehensive income', which represents the
change in equity during a period, other than changes resulting from transactions
with owners in their capacity as owners. In applying this revision to IAS 1, a
'consolidated statement of comprehensive income' has been introduced which
replace the 'consolidated income statement'.
* International Accounting Standard 23: Borrowing costs (IAS 23) (amended 2007)
supersedes IAS 23 (revised 1993), making it mandatory to capitalise borrowing
costs that are directly attributable to a qualifying asset as defined by IAS 23.
The impact of IAS 23 is immaterial to the Group's financial statements as at 1
January 2009 and for the six months to 30 June 2009.
* International Financial Reporting Standard 2: Share-based payment: Vesting
conditions and cancellations. The impact of this amendment is immaterial to the
Group's financial statements as at 1 January 2009 and for the six months to 30
June 2009.
* International Financial Reporting Standard 8: Operating segments (IFRS 8) is
applicable for financial periods beginning on or after 1 January 2009 and
requires the Group to report information about its operating segments based on
the components of the entity that management uses to make operating decisions.
No other new standards, amendments or interpretations applicable to this
accounting period have had an effect on these interim results.
The preparation of the condensed consolidated half year financial statements
requires the use of certain accounting estimates and judgments that affect the
application of accounting policies and the reported amounts of assets and
liabilities, income and expense. The significant judgments made by management in
applying the Group's accounting policies and the key sources of estimation
uncertainty were the same as those that applied to the financial statements for
the 17 months ended 31 December 2008.
2. Financial reporting period
The condensed interim financial information for the period 1 January 2009 to 30
June 2009 is unaudited. In the opinion of the directors the condensed interim
financial information for the period presents fairly the financial position, and
results from operations and cash flows for the period and are in conformity with
the generally accepted accounting principles consistently applied. The accounts
incorporate comparative figures for the interim period 1 January 2008 to 30 June
2008 (not previously published) and the audited 17 month period to 31 December
2008.
The financial information contained in this interim report does not constitute
statutory accounts.
The comparatives for the 17 months ended 31 December 2008 are not the company's
full statutory accounts for that period. A copy of the statutory accounts for
that period has been delivered to the Registrar of Companies. The auditors'
report on those financial statements was unqualified, did not include references
to any matters to which the auditors drew attention by way of emphasis without
qualifying their report and did not contain a statement under section 237(2)-(3)
of the Companies Act 1985.
The presentation of the comparatives for the 17 months ended 31 December 2008
has been restated to reflect the impact of discontinued operations as discussed
in Note 4.
3. Earnings per share
The calculation of basic and diluted profit per share has been based on the
profit for the period of GBP18,000 (2008 - loss of GBP1,812,000) and the
weighted average number of shares being 209,621,949 ordinary shares issued for
the period ended 30 June 2009 (2008 - 209,505,282).
4. Discontinued operations
As announced on 1 April 2009, the Group undertook a restructuring in which
ADDWellness Holdings Limited, a joint venture between ADDleisure and Bupa
Finance Plc, and its subsidiary Movers & Shapers Limited were placed into
administration.
On this date, ADDleisure Plc also purchased 100% of the issued share capital of
Fitbug Limited for GBP1 cash and acquired ADDWellness Holding Limited's
receivable rights under an existing inter-company loan made by ADDWellness
Holdings Limited to Fitbug Limited of GBP3.5 million for a total cash
consideration of GBP250,000.
During the period, a loan of GBP1,000,000 was raised being GBP800,000 from Bupa
and GBP100,000 from both Allan Fisher and David Turner. The loan is for 3 years
with interest at 5% above LIBOR and all interest is to be rolled up until
repayment of the loan in full or part. Subsequent to 30 June 2009, it has been
agreed that GBP500,000 of these loans will be converted into equity.
5. Acquisition of Fitbug
On 1 April 2009, ADDleisure plc acquired the entire share capital of Fitbug
Limited for the sum of GBP1.
+------------------------------------------------+----------+---------+
| Fair value of assets acquired | GBP'000 | GBP'000 |
+------------------------------------------------+----------+---------+
| | | |
+------------------------------------------------+----------+---------+
| Fixed assets | 128 | |
+------------------------------------------------+----------+---------+
| Inventories | 76 | |
+------------------------------------------------+----------+---------+
| Debtors | 444 | |
+------------------------------------------------+----------+---------+
| Bank deposits | 228 | |
+------------------------------------------------+----------+---------+
| Creditors | (1,083) | |
+------------------------------------------------+----------+---------+
| | | |
+------------------------------------------------+----------+---------+
| Net liabilities acquired | | (207) |
+------------------------------------------------+----------+---------+
| | | |
+------------------------------------------------+----------+---------+
| | | |
+------------------------------------------------+----------+---------+
| Consideration paid | | |
+------------------------------------------------+----------+---------+
| Cash payments | | - |
+------------------------------------------------+----------+---------+
| | | |
+------------------------------------------------+----------+---------+
| Excess of consideration paid over net | | (207) |
| liabilities | | |
+------------------------------------------------+----------+---------+
6. Intangible assets
During the year intangible assets increased due to the recognition of GBP207,000
of goodwill (see note 5) and additional development expenditure of GBP248,000
coupled with amortisation of GBP23,000. No impairment charges have been recorded
during the period.
7. Post balance sheet events
Ez-Runner Limited
On 5 October 2009, Ez-Runner Limited was placed into administration. The
contingent consideration of GBP693,000 and the goodwill, arising on the
acquisition of ClubRunner (Europe) Limited, of GBP928,000 are included in the
accounts of Ez-Runner Limited and therefore will not form part of the
consolidated accounts at 31 December 2009.
As at 30 June 2009, the investment in Ez-Runner Limited by ADDleisure plc was
GBP532,000 which will be fully impaired in the December 2009 accounts.
Additionally, as at 30 June 2009 the intercompany balances due from Ez-Runner
Limited were:
+-----------------------------------------------------------+--------------+
| ADDleisure plc | GBP1,599,000 |
+-----------------------------------------------------------+--------------+
| ADDleisure 2004 Limited | GBP1,024,000 |
+-----------------------------------------------------------+--------------+
All these intercompany accounts will be impaired in the December 2009 results.
As a result of Ez-Runner Limited being placed into administration, a subsidiary
guarantee given by ADDleisure plc to secure the Virgin Active UK contract has
now crystallised and a full and final settlement of GBP150,000 has been agreed.
8. Fundraising and going concern
The Group has conditionally raised GBP1,200,000, before expenses, by way of a
share placing on 3 December 2009. On this basis the directors are of the opinion
that the business will be able to continue as a going concern for at least the
next 12 months.
The GBP1.2 million consists of GBP300,000 interim funding from the directors
which will be converted into equity and the balance of GBP900,000 being new
money.
In addition to the GBP1.2 million raised, Bupa and the directors have agreed to
convert GBP500,000, being part of their loans made in April 2009, into equity.
Bupa have agreed to convert GBP300,000 and David Turner and Allan Fisher agreed
to convert GBP100,000 each.
* * ENDS * *
For further information visit www.addleisure.com or contact:
+----------------------------+----------------------------+-------------------+
| Andrew Brummer | ADDleisure Plc | Tel: 020 7449 |
| | | 1000 |
+----------------------------+----------------------------+-------------------+
| Mark Percy / Catherine | Seymour Pierce | Tel: 020 7107 |
| Leftley | | 8000 |
+----------------------------+----------------------------+-------------------+
| Isabel Crossley / Paul | St Brides Media & Finance | Tel: 020 7236 |
| Youens | Ltd | 1177 |
+----------------------------+----------------------------+-------------------+
This information is provided by RNS
The company news service from the London Stock Exchange
END
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