Final Results
April 30 2003 - 12:46PM
UK Regulatory
RNS Number:5957K
Culver Holdings PLC
30 April 2003
Chairman's Statement
The Board is pleased to announce the Group's results for the year ended 31
December 2002.
TRADING SUMMARY
Turnover for continuing operations was #2.820 million (2001 - #2.271 million).
The operating profit was #45,000 (2001 - loss #1.982 million) (before goodwill
amortisation principally attributable to the Insurance division of #348,000)
(2001 - #233,000), and the retained loss was #12,000 (2001 - #3.751 million).
The business of the Group was until disposal of Wire 2 Limited in November 2002
operated through three divisions: Technology, Media, and Insurance. The Group's
business is now operated through the Technology and Insurance divisions.
Technology
(Continuing business - turnover #0.133 million, operating loss #251,000)
The Group's technology business, which trades as Wanbase, reported losses for
the financial year to 31 December 2002. These are largely attributable to
research and development into the emerging technologies of virtual private
networking and delivery of voice and data over internet protocol.
Wanbase has formed a number of strategic partnerships with leading manufacturers
in this exciting new business area and has successfully delivered a number of
solutions in the small to medium sized enterprise sector which is its target
market.
Management is tightly focussed on delivery of its business plan and the Group's
investment in the business is being closely monitored. However, the Board do
believe that provided sufficient sales growth can be achieved, this business
provides the Group with excellent prospects for the future.
Media- discontinued
(Turnover #1.178 million, operating profit #30,000)
As the Group announced on 19 November 2002, it has disposed of 100% of the share
capital of Wire 2 Limited, its news aggregation and distribution business. As
stated in the announcement, the disposal improved the Group's liquidity and
enabled management to focus on its insurance and technology businesses.
Insurance
(Turnover #2.687 million, operating profit #171,000 (after goodwill amortisation
of #346,000))
The strong performances of the insurance broking and IFA businesses were
maintained for the financial year to 31 December 2002 and the Board is pleased
with the result for the year.
As the Group announced on 3 February 2003, Culver Insurance Brokers acquired a
portfolio of commercial insurance business from Budget Group, in line with the
Group's strategy to concentrate on its insurance and technology businesses.
The enlarged businesses are trading in line with the Directors' expectations and
the Board is optimistic that another satisfactory result will be produced for
the current year.
The Board continues to explore ways of both expanding its insurance interests
and offering additional services to its existing clients in related areas.
Investment Impairment
The Group's remaining investment of 13,785,403 ordinary shares in World Travel
Holdings plc ("WTH") being 4.22 % of WTH's issued share capital as at 31
December 2002 has been written down by a further #258,476 to #1 to reflect
market conditions.
Prospects
The Group's insurance business has developed well during the year to 31 December
2002 and during the first quarter of 2003. The Group is committed to growing
this business organically and by appropriate acquisition.
The IFA business has had a difficult start to 2003 as a result of the collapse
in equity markets which has been well documented, but the Group has no reason to
believe that the business will fail to meet its business plan for the year. The
business is currently expanding through the recruitment of high quality
personnel.
The Board is satisfied that the technology business is operating in a market
place which has significant potential. The development of the provision of voice
and data services over internet protocol is gathering pace and Wanbase is at the
forefront of this technology and has developed invaluable experience of
delivering leading edge solutions in the real commercial world. Additional sales
staff are also being recruited and the Board believes that the business's
momentum will increase during 2003. The Board believes that the company's sales
targets are ambitious but realistic and the first quarter of the year has
already proved to be satisfactory.
As I said in my interim statement, the Board anticipated toughening conditions,
which do appear to have materialised since then. However, the Group's businesses
have continued to improve and to grow, although in the IFA and technology
markets in particular that growth has not been as rapid as might have been
hoped. Nonetheless, in the absence of further global economic and other turmoil,
we believe that our businesses are well placed for future continued success.
It only remains for me to thank everyone in the Group for all the hard work they
have put in during the last year. The excellent results of the insurance broking
division are evidence of this. I hope that in the current year the efforts of
the technology division will be equally rewarded.
R M H Read
Chairman
30 April 2003
Culver Holdings plc
Preliminary unaudited results for the year ended
31 December 2002
Consolidated
Profit and Loss Account Notes 2002 2001
#'000 #'000
Turnover 3
Continuing operations 2,820 2,271
Discontinued 1,215 2,076
----- -----
4,035 4,347
Cost of sales
Continuing operations (1,246) (1,096)
Discontinued (534) (1,754)
------- -------
(1,780) (2,850)
------- -------
Gross Profit
Continuing operations 1,574 1,175
Discontinued 681 322
----- ------
2,255 1,497
Administration expenses
Continuing operations (2,007) (2,460)
Discontinued (551) (1,252)
------- -------
(2,558) (3,712)
Operating loss 4
Continuing operations (433) (1,285)
Discontinued 130 (930)
------- -------
(303) (2,215)
Profit on sale of fixed assets 23 15
Gain/(Loss) on sale and termination of subsidiaries 6 766 (244)
Amounts written off investments 5 (458) (1,306)
Interest receivable and similar income 12 50
Interest payable and similar charges (49) (47)
------- -------
Loss before taxation (9) (3,747)
Taxation 7 (3) (4)
------- -------
Loss after taxation and retained loss (12) (3,751)
------- -------
Basic Loss per share (pence) 8 (0.11) (32.11)
------- -------
Shares in issue (millions) 11.34 11.23
Shares used in calculating eps (millions) 11.27 11.68
------- -------
Statement of Recognised Gains and Losses 2002 2001
for the year ended 31 December 2002 #'000 #'000
Retained Loss (12) (3,751)
Other recognised gains
Arising on release of escrow account - 325
------- -------
Total Recognised Gains and Losses (12) (3,426)
------- -------
Culver Holdings plc
Preliminary unaudited results
for the year ended 31 December 2002
Consolidated
Balance Sheet 2002 2001
#'000 #'000
Fixed Assets
Goodwill 1,625 3,166
Tangible assets 250 491
Investments 107 625
----- -----
1,982 4,282
----- -----
Current Assets
Debtors 1,616 2,158
Cash at bank and in hand 624 485
----- -----
2,240 2,643
Creditors: amounts falling due within (2,559) (4,894)
one year ------- -------
Net current liabilities (319) (2,251)
------- -------
Total assets less current liabilities 1,663 2,031
Creditors: amounts falling due after (180) (1,033)
more than one year
Provisions for liabilities and charges (1,142) (700)
------- -------
Net assets 341 298
------ ------
Capital and reserves
Called up share capital 2,834 2,807
Share premium 4,403 4,375
Profit and loss account (6,896) (6,884)
------- -------
341 298
------- -------
Culver Holdings plc
Preliminary unaudited results
for the year ended 31 December 2002
Consolidated Cash Flow Statement Notes 2002 2001
#'000 #'000
Net cash inflow/(outflow) from operating 10 (442) (837)
activities ------- -------
Returns on investments and servicing of finance
Interest received 12 50
Interest paid (49) (47)
------- -------
Net cash flow from returns on investments and (37) 3
servicing of finance ------- -------
Capital expenditure and financial investments
Purchase of tangible fixed assets (13) (295)
Sale of tangible fixed assets 123 238
Receipt on sale of subsidiary 500 -
Sale of investments 667 -
Purchase of investments (8) (33)
------- -------
Net cash inflow/(outflow) from capital 1,269 (90)
expenditure and financial investments ------- -------
Acquisitions and disposals 1 -
------- -------
Net cash inflow/(outflow) before financing 791 (924)
-------- -------
Financing
Issue of shares 55 -
Loan received 127 450
Repayment of loans (513) (54)
Capital element of hire purchase (225) (89)
------- -------
Net cash (outflow)/inflow from financing (556) 307
------- -------
Increase/(decrease) in cash in period 235 (617)
------- -------
Represented by:-
Increase in insurance broking balances 69 183
Increase/(decrease) in other balances 166 (800)
------- -------
235 (617)
------- -------
Reconciliation of net cash flow to movement in net debt
Increase/(decrease) in cash in period 235 (617)
Cash inflow/(outflow) from movement in
debt and lease financing 611 (307)
------- -------
Change in net debt resulting from cash flows 846 (924)
New Hire Purchase agreements (86) -
Hire purchase contracts disposed of with subsidiaries 32 -
------- -------
Movement in net funds/(debt) in the period 792 (924)
Net (debt)/funds at the start of the period (453) 471
------- -------
Net funds/(debt) at the end of the period 11 339 (453)
------- -------
- Culver Holdings plc
Preliminary unaudited results
For the year ended 31 December 2002.
Notes to the Financial Statements
1. Fundamental accounting concept - going concern
During the year the Group repaid the bank loan and overdraft outstanding at 31
December 2001 and agreed new banking facilities at a reduced level. This was
achieved by a combination of tighter cash management control and the disposal of
Wire2 Limited, a loss making subsidiary company.
Whilst seeking to minimise the losses being incurred within the technology
division during its early stages of development and further improve the
profitability of the insurance division, the directors continue to make great
efforts to work within the bank facilities that are available to the Group. They
anticipate that this will be achievable if the current business plans are met.
The Group has a wholly owned subsidiary undertaking which acts as an independent
financial adviser regulated by the Financial Services Authority. None of the
directors of the parent undertaking is a director of this subsidiary
undertaking, all of whose directors are authorised persons in terms of the
Financial Services and Markets Act.
When under management which has now been replaced, the subsidiary undertaking,
incurred liabilities in respect of pension mis-selling now estimated to be
#718,000 (2001: #700,000) which have been provided for in these financial
statements. Some #414,000 (2001: #330,000) of these liabilities is covered by
insurance which the subsidiary undertaking holds.
The parent is not liable for the pension mis-selling liabilities of the
subsidiary undertaking. The subsidiary has, during the year, arranged external
finance, which its directors consider will be sufficient to enable it to meet
these liabilities.
Whilst the directors consider that the provision in the accounts for pension
mis-selling liabilities is a reasonable estimate of the ultimate cost, given the
assumptions that have been made, there remain a number of areas of uncertainty
which may result in the ultimate cost being different.
In view of the significance of these uncertainties, it is anticipated that they
will be drawn to shareholders' attention by the auditors in their report but
their opinion is not expected to be qualified in this respect.
2. Basis of preparation
The financial information has been prepared on the basis of the accounting
policies as set out in the group's statutory accounts for the year ended 31
December 2001, with the exception of the introduction of FRS 19 in respect of
Deferred Taxation but this has no impact on the financial statements.
2002 2001
#'000 #'000
3. Analysis of turnover
Insurance 2,687 2,249
Insurance-discontinued 19 20
Finance-discontinued 17 9
Media-discontinued 1,178 1,247
Technology 133 22
Technology-discontinued 1 800
------- -------
4,035 4,347
------- -------
2002 2001
#'000 #'000
4. Analysis of operating loss
Insurance 171 (245)
Insurance-discontinued (2) (5)
Finance-discontinued 93 16
Media-discontinued 30 (418)
Technology (251) (81)
Technology-discontinued 9 (523)
Central costs (353) (959)
------- ------
(303) (2,215)
------- -------
5. In 2002 provisions of #258,476 and #200,000 respectively have been made
against the shares and loan notes of World Travel Holdings plc. This is
considered appropriate as World Travel Holdings plc continues to incur
substantial losses and has net current liabilities.
In 2001 the investment held in the shares of World Travel Holdings plc and
the Loan Notes in Aerotech Europe Limited held by the Group were written down to
reflect market conditions based on a transaction completed in 2002. A loss also
arose in 2001 because the escrow account to acquire the shares of Aerotech
Systems Inc expired on 8 December 2001 under the terms of the agreement between
the parties.
6. The profit in 2002 arises on the deconsolidation of a number of dormant
subsidiaries where application has been made to Companies House in accordance
with section 652A of the Companies Act 1985 to have those companies struck off
and in one case where the subsidiary was liquidated.
In addition this included the profit arising on the sale of Wire2 Limited on 15
November 2002. The loss in 2001 arises on the sale of Aerotech Europe Limited
and the sale of the business of Carnell Systems Limited to World Travel Holdings
plc.
7. Provision for taxation has been made assuming current rates of Corporation
Tax based upon the estimated rate of taxation for the year. No deferred taxation
asset has been recognised in respect of tax losses brought forward.
8. The loss per share has been calculated on a weighted average of 11,274,735
(2001: 11,680,546) ordinary shares in issue during the year based on a loss of
#12,000 (2001: 3,751,000).
9. The 2001 results include an unrealised profit of #74,000 arising from the
receipt of World Travel Holdings plc shares in the unwinding of the escrow
account.
10. Reconciliation of operating loss to net cash flow from operating activities
2002 2001
#'000 #'000
Operating loss (303) (2,215)
Depreciation charge 240 361
Amortisation of goodwill 353 233
Profit on sale fixed assets 23 -
Decrease/(Increase) in debtors 245 (442)
(Decrease)/Increase in creditors (1,000) 1,226
------- -------
Net cash outflow from operating activities (442) (837)
------- -------
At
beginning At end of
of year Cash flow year
#'000 #'000 #'000
11. Analysis of debt
Cash in hand, at bank
Insurance broking 482 69 551
Other 3 70 73
Overdrafts (102) 96 (6)
------ ----- -----
383 235 618
------ ----- -----
Debt due within one year (511) 498 (13)
Debt after one year - (113) (113)
Hire purchase (325) 172 (153)
------ ----- -----
(836) 557 (279)
------ ----- -----
Total (453) 792 339
------ ----- -----
12. The comparative figures for the financial year ended 31 December 2001 are
extracted from the Company's statutory accounts. Those accounts have been
reported on by the Company's previous auditors and delivered to the Registrar of
Companies. The report of the auditors was unqualified and did not contain a
statement under Section 237(2) or (3) of the Companies Act 1985.
13. The financial information contained in this statement does not constitute
statutory accounts as defined in Section 240 of the Companies Act 1985.
This information is provided by RNS
The company news service from the London Stock Exchange
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