TIDMSYG
RNS Number : 9644H
Speymill PLC
27 June 2013
For Immediate Release 27 June 2013
Speymill plc
("Speymill" or the "Company")
Annual Report and Accounts
The Company is pleased to announce its audited annual report and
accounts for the year ended 31 December 2012 (the "Accounts"). The
Accounts containing an unqualified audit opinion will be sent to
Shareholders shortly and will also shortly be available at the
Company's website, www.speymill.com.
For further information:
Speymill PLC
Denham Eke
Tel +44 (0)1624 640860
Beaumont Cornish Limited (Nominated Adviser and Broker)
Roland Cornish
Tel +44 (0)207 628 3396
Extracts of the Accounts are set out below:
Chairman's statement
In the Interim Report for 2012, I commented on the difficult
conditions we face and the continuing need to restructure the Group
in the light of market conditions. We have had to make a number of
difficult decisions since that point, one of which culminated with
the announcement of the Administration of Speymill Contracts
Limited ("Contracts") on 19 December 2012. I would now take this
opportunity to report further and update you on the challenges that
still confront us.
Results
During the year ended 31 December 2012, the Group returned a
Total Comprehensive Loss before tax of GBP6.12 million (2011: loss
of GBP0.43 million). These figures represent a combination of
continuing and discontinued operations, with continuing operations
returning a loss before tax of GBP4.20 million for 2012 (2011: loss
of GBP1.45 million).
As a consequence of Contracts entering administration we have
included their results to 31 October 2012 as being the last date
for which we have substantive accounting information. Thus for the
period to 31 October 2012, Contracts made a loss before tax of
GBP4.01 million (12 months for 2011: profit of GBP0.11
million).
The Group's German property investments generated a loss of
GBP3.71 million (2011: profit of GBP0.75 million). This result
includes a loss of GBP3.96 million that we have had to recognise
following the revised valuation of the properties held by the
investing entities of Horsfield Limited and Wyatt Limited.
The Group's turnover for continuing operations for the year was
GBP1.52 million, (2011: GBP1.54 million), the decline being
principally due to foreign exchange fluctuations.
As with the prior year, there is no tax charge for the year in
respect of continuing activities. In relation to discontinued
operations, we have recognised a tax charge of GBP0.01 million
(2011 a tax recovery of GBP0.39 million).
Financial position
The Group's financial position showed net liabilities of GBP3.09
million at 31 December 2012 (2011: net assets of GBP3.03 million),
an adverse swing of GBP6.12 million.
Of the GBP1.15 million Cash Held on the Balance Sheet, GBP1.03
million is held as further security in favour of Deutsche
Genossenschafts-Hypothekenbank AG ("DG Hyp"), the German bank
financing the property loans.
As a result of the various changes we have had to make,
Shareholder Equity has reversed to a negative GBP3.09 million
(2011: positive GBP3.03 million).
Speymill Contracts
As I commented in the Interim Report, Contracts generated
GBP12.1 million of turnover for the first six months of 2012 but
made a loss of GBP1.76 million. In the period following this
announcement, the position at Contracts continued to decline in
terms of the profitability of existing projects and, more
importantly, their need for increased working capital developed
into a regular and onerous burden.
As a consequence, the Group's Directors engaged professional
advisors to undertake comprehensive reviews of the situation at
Contracts and to advise on options to manage the situation.
Ultimately, the deteriorating financial position combined with no
realistic prospect of further work resulted in a position where the
Group's Directors believed that they could not continue to support
Contracts without compromising the future of the Group as a whole.
Therefore, as announced on 19 December 2012, Contracts was placed
into Administration.
As at 31 October 2012, the last set of accounts available before
the Administration, Contracts reported a turnover for 2012 of
GBP19.80 million and a loss before tax of GBP4.01 million. As at
the same date, Contracts had net liabilities of GBP18.27 million.
Taking into account the net liability position, the writing-off of
Group intercompany debt and the provision for certain further
liabilities which may potentially arise from Contract's
Administration, the Group recognised an effective gain on disposal
of GBP1.31 million.
German Property Investment
The German property investment entities, Horsfield Limited
("Horsfield") and Wyatt Limited ("Wyatt") generated revenue of
GBP1.52 million for 2012 (2011: GBP1.54 million).
As part of the loan conditions, DG Hyp, the funding bank for the
portfolios, having expressed concerns regarding the previous
valuation of the portfolio, requested a revaluation. The Directors
had previously undertaken an internal review of the properties
based on the value of other properties in similar areas that were
available for sale. As a result of this, and following IFRS
requirements, an external and independent valuation was undertaken
by CBRE GmbH. Whilst the Directors are mindful that some German
property, particularly that in Berlin has increased in value
recently, the properties owned by Horsfield and Wyatt are in the
south east of Germany, in and around Leipzig, Dresden, Halle and
the surrounding areas. This area has not experienced the same rise
in value and indeed, transactions at the level we might hope for
are not currently available.
This valuation provided a combined worth of Horsfield and Wyatt
of GBP17.89 million (2011: GBP22.13 million), a downgrade of
GBP4.25 million leading to a recognised loss of GBP3.71 million
(2011: GBP0.75 million).
Speymill Deutsche Immobilien Company plc ("SDIC")
As part of the acquisition of GOAL construction GmbH and
termination of the Investment Management Agreement, SDIC issued
convertible loan notes ("Loan Notes") to Speymill in the aggregate
amount of EUR2.088 million. As announced on 24 May 2012, a final
settlement has been reached in relation to these Loan Notes whereby
the Group agreed to accept EUR1.86 million in settlement of the
outstanding principal and interest.
Proposed Restructuring
Since 2009 I, together with others, have been providing funding
to the Group to allow it to continue as a going concern. Since June
2010, Burnbrae Limited (a company which is indirectly wholly owned
by the trustee of a settlement under which I have a life tenancy)
and I have been providing a funding facility to provide Speymill
with the working capital it requires, the current outstanding
balance of this facility being GBP6.28 million.
The Group's Directors have been considering strategic options
for some time and the Administration of Contracts together with the
downward revaluation of the German properties has only served to
focus that thinking on how the Group might move forward. In
particular, the Board is concerned that the German properties have
to be re-financed in 2014 and also that additional sums will be
needed to both maintain and refurbish the portfolios to maximise
rental yields before this negotiation which is likely to be
complex, particularly considering the worth of the Group's balance
sheet. Thus having considered all the options for allowing the
Group to continue to trade for the benefit of all shareholders and
the likely quantum of the future financing requirement to achieve
this, the Group's directors propose a transaction whereby the
divestment of the German property entities will be used to part
satisfy the current shareholder loan liability thereby creating a
company with minimised legacy issues and capable of delivering a
new investing strategy. Further details of this are provided in the
accompanying Circular and to which I would ask you to refer.
The Directors therefore propose to move the Group in a new
direction as an investment company and accordingly propose to
extinguish a proportion of the existing debt through the transfer
of the German investment property as repayment for part of the
loan. As part of the same proposed deal a payment of GBP300,000 in
cash will be made, which will provide the Group with working
capital to meet its expected liabilities for a further year. The
intention is to place the Group in a position where it can seek an
investment opportunity with an entity that wishes to obtain an AIM
market listing.
As this proposed transaction will require shareholder approval,
we have included the relevant information in the attached Circular
and propose to hold a General Meeting following the Annual General
Meeting on 30 July 2013 at which we will seek approval for this
transaction.
In order to allow time for the required shareholder vote at a
General Meeting, I together with Burnbrae, have agreed to extend
the current shareholder loan facility until 31 August 2013. If the
relevant approval is granted then the loan balance will be reduced
by the value of the assets transferred to Burnbrae and myself and
the remaining balance will be incorporated into a new facility
provided by Galloway Limited ("Galloway"), and which is indirectly
wholly owned by a Trust in which I have a life interest. The
intention would be to hold this balance until such time as a
suitable investment is identified and then Galloway would intend to
convert the remaining balance into shares in the Group.
Conclusion
The Board believes that it is left with no option if it is to
preserve the Group, this transaction must take place to enable the
Group to move in a new direction. Thus the transaction proposed
allows an opportunity for future development and the prospect of
shareholder return.
Jim Mellon
Chairman
25 June 2013
Consolidated income statement
For the year ended 31 December 2012
2012 2011
Total Total
Notes GBP'000 GBP'000
------------------------------- ------ -------- ---------
Turnover 2 1,519 1,544
Cost of sales (401) (832)
------------------------------- ------ -------- ---------
Gross profit 1,118 712
------------------------------- ------ -------- ---------
General administrative
expenses (596) (871)
Share-based payments 5 (2)
Loss on revaluation of
investment properties 9 (3,685) -
------------------------------- ------ -------- ---------
Total operating costs (4,276) (873)
------------------------------- ------ -------- ---------
Loss from operations (3,158) (161)
Net finance costs 5 (1,046) (1,293)
-------- ---------
Loss on ordinary activities
before taxation (4,204) (1,454)
Taxation 7 - -
------------------------------- ------ -------- ---------
Loss after taxation from
continuing operations (4,204) (1,454)
------------------------------- ------ -------- ---------
(Loss) / profit after
taxation from discontinued
operations 3 (3,098) 1,381
Profit on disposal of
operations 3 1,311 -
------------------------------- ------ -------- ---------
Loss after taxation (5,991) (73)
Attributable to:
Owners of the Company (5,802) (34)
Non-controlling interest (189) (39)
------------------------------- ------ -------- ---------
(5,991) (73)
------------------------------- ------ -------- ---------
Loss per share for continuing
operations (pence)
------------------------------- ------ -------- ---------
Basic 7 (6.88) (2.42)
------------------------------- ------ -------- ---------
Diluted 7 (6.88) (2.42)
------------------------------- ------ -------- ---------
Loss per share for total
operations (pence)
------------------------------- ------ -------- ---------
Basic 3,7 (9.94) (0.06)
------------------------------- ------ -------- ---------
Diluted 3,7 (9.94) (0.06)
------------------------------- ------ -------- ---------
Consolidated statement of comprehensive income
For the year ended 31 December 2012
2012 2011
Total Total
GBP'000 GBP'000
--------------------------------------------------------------------- -------- --------
Loss for the year (5,991) (73)
--------------------------------------------------------------------- -------- --------
Other comprehensive income:
Revaluation of available-for-sale financial assets - (54)
Currency translation differences on foreign operations (174) (304)
Revaluations realised on disposal of financial assets at fair value 50 -
---------------------------------------------------------------------
Total comprehensive loss for the year (6,115) (431)
--------------------------------------------------------------------- -------- --------
Statements of financial position
As at 31 December 2012
31-Dec 31-Dec 31-Dec 31-Dec
2012 2012 2011 2011
Group Company Group Company
Notes GBP'000 GBP'000 GBP'000 GBP'000
--------------------------- ------ -------- -------- -------- ----------
Non-current assets
Property, plant
and equipment 8 4 - 51 -
Investments in
subsidiaries and
joint ventures - 22 - 1,134
Investment property 9 - - 22,131 -
Financial assets
at fair value 1 - 1,375 -
Total non-current
assets 5 22 23,557 1,134
--------------------------- ------ -------- -------- -------- ----------
Current assets
Investment property 9 17,885 - - -
Due from customers
for contract work - - 1,349 -
Trade and other
receivables 984 8,091 3,683 19,815
Cash and cash equivalents 1,152 5 1,066 23
Total current assets 20,021 8,096 6,098 19,838
Total assets 20,026 8,118 29,655 20,972
--------------------------- ------ -------- -------- -------- ----------
Equity
Capital and reserves
Ordinary share
capital 584 584 584 584
Share premium 34 34 34 34
Share-based payments
reserve 123 123 146 146
Other income reserve (108) (835) (920) (494)
Retained income (3,223) 347 3,494 15,988
--------------------------- ------ -------- -------- -------- ----------
Equity attributable
to owners of the
Company (2,590) 253 3,338 16,258
Non-controlling
interest (497) - (308) -
Total equity (3,087) 253 3,030 16,258
--------------------------- ------ -------- -------- -------- ----------
Non-current liabilities
Interest Bearing
Loans 13,887 - 14,417 -
Derivative Financial
Instruments 971 - 1,046 -
Shareholders' loan 5,722 5,722 2,754 2,754
--------------------------- ------ -------- -------- -------- ----------
Total non-current
liabilities 20,580 5,722 18,217 2,754
--------------------------- ------ -------- -------- -------- ----------
Current liabilities
Bank overdraft - - - -
Trade and other
payables 2,342 2,143 4,622 1,960
Due to suppliers
for contract work - - 3,612 -
Interest Bearing
Loans 187 - 182 -
Current tax liabilities 4 - (8) -
Total current liabilities 2,533 2,143 8,408 1,960
--------------------------- ------ -------- -------- -------- ----------
Total liabilities 23,113 7,865 26,625 4,714
Total equities
and liabilities 20,026 8,118 29,655 20,972
--------------------------- ------ -------- -------- -------- ----------
Consolidated statement of changes in equity
For the year ended 31 December 2012
Ordinary Share Share-based Other Retained Attributable Non-Controlling Total
share premium payment income income/ to owners equity
capital reserve (loss) of the
parent
(1) (3) (4) (5) Interest
(2) (6)
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------------- --------- -------- ------------ -------- --------- ------------- ---------------- --------
Balance at 31
December 2010 584 34 1,105 (562) 2,493 3,654 (269) 3,385
Loss for the
year - - - - (34) (34) (39) (73)
Other comprehensive
income for the
year:
Revaluation of
available-for-sale
financial assets - - - (54) - (54) - (54)
Currency
translation
differences on
foreign operations - - - (304) 69 (235) - (235)
Transactions
with owners,
recorded directly
in equity:
Share based
payments:
- share options
charge - - 7 - - 7 - 7
Lapsed/forfeited
share options - - (966) - 966 - - -
Balance at 31
December 2011 584 34 146 (920) 3,494 3,338 (308) 3,030
-------------------- --------- -------- ------------ -------- --------- ------------- ---------------- --------
Loss for the
year - - - - (5,802) (5,802) (189) (5,991)
Other comprehensive
income for the
year:
Revaluation of
financial assets
at fair value - - - 633 (633) - - -
Currency
translation
differences on
foreign operations - - - (174) - (174) - (174)
Revaluations
realised on
disposal
of financial
assets at fair
value - - - 50 - 50 - 50
Transactions
with owners,
recorded directly
in equity:
Share based
payments:
- share options
charge - - (5) - - (5) - (5)
Lapsed/forfeited
share options - - (18) (45) 63 - - -
Own shares disposed - - - 3 - 3 - 3
Lapsed/forfeited
deferred share
awards - - - 345 (345) - - -
Balance at 31
December 2012 584 34 123 (108) (3,223) (2,590) (497) (3,087)
-------------------- --------- -------- ------------ -------- --------- ------------- ---------------- --------
(1) Ordinary Share Capital represents the nominal value of shares allotted and issued.
(2) Share Premium represents the premium paid, where appropriate, on shares allotted and issued.
(3) Share Based Payments represents the current carrying value
of remuneration issued in the form of shares which have not yet
been issued, for example the value of share options issued but not
yet exercised.
(4) Other Income Reserve represents reserves arising from
foreign exchange differences and any other reserves not
attributable to Share Capital, Share Premium, Share Based Payments
or Retained Income.
(5) Retained Income represents the retained income of the company and its subsidiaries.
(6) Non-controlling interests represent the retained income
attributable to minority shareholders in subsidiaries.
Consolidated statement of cash flows
For the year ended 31 December 2012
31-Dec 31-Dec
------
2012 2011
Notes GBP'000 GBP'000
-------------------------------------- ------ --------- ---------
Cash flows from operating activities
Net cash (outflow) / inflow
from operations (2,788) 2,182
Taxation paid 8 (14)
-------------------------------------- ------ --------- ---------
Net cash (outflow) / inflow
from operating activities (2,780) 2,168
Cash flows from investing activities
Cash held by subsidiary on (164) -
disposal
Settlements in relation to
financial instruments 1,326 191
Net purchase and disposal of
property, plant and equipment (8) (26)
-------------------------------------- ------ --------- ---------
Net cash inflow from investing
activities 1,154 165
Cash flows from financing activities
Sale of own shares 3 -
Shareholders' loan drawdown 6,421 475
Shareholders' loans repayments,
including interest and fees (3,800) (1,241)
Finance lease principal repayments - (2)
Repayment of interest bearing
loans (173) (176)
Interest paid (743) (816)
-------------------------------------- ------ --------- ---------
Net cash inflow / (outflow)
from financing activities 1,708 (1,760)
-------------------------------------- ------ --------- ---------
Net increase in cash and cash
equivalents 82 573
-------------------------------------- ------ --------- ---------
Translation 4 (69)
Cash and cash equivalents at
beginning of year 1,066 562
-------------------------------------- ------ --------- ---------
Net cash and cash equivalents
at end of year 1,152 1,066
-------------------------------------- ------ --------- ---------
Cash and cash equivalents comprise
Bank balances 1,152 1,066
Bank overdraft used for cash - -
management purposes
-------------------------------------- ------ --------- ---------
Cash and cash equivalents in
the statement of cash flows 1,152 1,066
-------------------------------------- ------ --------- ---------
Cash (used by) / generated
from operations
Profit from operations (4,261) 867
Adjusted for:
Depreciation of tangible assets 8 24 126
Share-based payments charge (5) 7
Revaluation of available-for-sale
financial assets - (334)
Decrease / (increase) in receivables 1,025 (1,028)
Increase in payables 429 2,544
-------------------------------------- ------ --------- ---------
Net cash (outflow) / inflow
from operations (2,788) 2,182
-------------------------------------- ------ --------- ---------
Notes to the consolidated financial statements
1 Reporting entity
Speymill plc is a public limited company incorporated and
domiciled in the Isle of Man (referred to as the Company). The
address of the Company's registered office is 1st Floor, Regent
House, 16-18 Ridgeway Street, Douglas, Isle of Man, IM1 1EN.
The consolidated financial statements of the Company as at and
for the year ended 31 December 2012 comprise the Company and its
subsidiaries (together referred to as the "Group" and individually
as "Group entities") and the Group's interest in jointly controlled
entities. The Group is primarily involved in real estate investment
management, construction operations, property management and
property investment.
1.1 Basis of preparation
(a) Statement of compliance
The consolidated financial statements have been prepared in
accordance with International Financial Reporting Standards
("IFRSs") as adopted by the EU.
Going concern
The Board is of the opinion that it has secured sufficient
finance in order to enable the Group to continue trading and that
it is appropriate to prepare these accounts on a going concern
basis. In support of this opinion, the Board has undertaken a
budgeting process for its business units for the period to 30 June
2014.
The Group has in place a shareholder loan facility (the "
Facility") entered into with Jim Mellon and Burnbrae Limited (the
"Lenders") on 24 June 2011 that was due to expire on 30 June 2013.
The Lenders have agreed to extend the Facility until 31 August
2013. This facility has a total limit of GBP7,000,000 and as of
today's date is drawn down to the extent of GBP5,645,128. All other
terms of this facility will remain the same as previously
advised.
As announced today, the Board has recommended a transaction
which will see a proportion of the Facility extinguished by the
transfer of ownership of Speymill's 94.9% shareholding in each of
Horsfield Limited and Wyatt Limited. In addition, the Lenders will
pay a further consideration of GBP300,000 to provide working
capital for the Company to meet its expected obligations for the
coming twelve months.
If the proposed transaction is approved, Galloway Limited (a
company related to both Jim Mellon and Burnbrae Limited) has
indicated that it will provide a new facility to repay the
outstanding balance and provide a further facility. This new
facility will have a limit of GBP4,000,000, the interest rate under
the proposed new facility will be 8%. As with the current facility,
an underwriting fee of 3% will be charged on all advances, save for
the initial advance to repay the current facility. Galloway Limited
("Galloway") will have the right to convert the debt into ordinary
shares in the company at a price based on the average closing price
of the shares for the five working days prior to the date of
conversion, subject to a maximum price of GBP0.01 (1 pence) per
ordinary share.
The Directors acknowledge that if the transaction to dispose of
the Group's interests in Horsfield Limited and Wyatt Limited is
approved then the Group will be left with no specific source of
income and revenue. Approval of the proposed transaction is
dependent upon shareholders voting in favour of the transaction at
the general meeting proposed in the circular document dated 25 June
2013.
Notwithstanding the cash consideration received under the
proposed transaction, the Group's going concern status will be
dependent upon the continuation of the proposed funding facility
from Galloway. Galloway has indicated to the Group's Directors that
it will consider future funding as and when the need arises, but
that it will not commit to providing future funding.
Speymill has also has an overdraft facility with its bank,
LloydsTSB Offshore, until 30 September 2013. The overdraft limit is
GBP50,000. The Board is currently in discussion with the bank to
extend the facility further.
Presentation of financial statements
The Group applies revised IAS 1 presentation of financial
statements (2007), which became effective as of 1 January 2009. As
a result, the Group presents in the consolidated statement of
changes in equity, all owner changes in equity, whereas all
non-owner changes in equity are presented in the consolidated
statement of comprehensive income. This presentation has been
applied in these financial statements from the year ended 31
December 2009.
2 Segmental information
The Group has two continuing reportable segments, as described
below, which are the Group's strategic business units; these being
the property investment operation and the central group management
and administration. The following summary describes the operations
in each of the Group's reportable segments:
-- Property investment
-- Other - head office, group and administration costs
31 December 2012
Property
investment Other Elimination Total
GBP'000 GBP'000 GBP'000 GBP'000
-------------------------------- ----------- --------- ------------ ---------
External revenue 1,519 - - 1,519
Inter-segment revenue - 308 (308) -
-------------------------------- ----------- --------- ------------ ---------
Total segment revenue 1,519 308 (308) 1,519
-------------------------------- ----------- --------- ------------ ---------
Reportable segment (loss)
/ profit from operations
before share-based payments (2,589) (15,344) 14,770 (3,163)
Share-based payments - 5 - 5
Finance income 50 417 (417) 50
Finance costs (1,166) (347) 417 (1,096)
-------------------------------- ----------- --------- ------------ ---------
Reportable segment (loss)
/ profit before tax (3,705) (15,269) 14,770 (4,204)
-------------------------------- ----------- --------- ------------ ---------
Depreciation - - - -
Reportable segment assets 19,104 13,514 (13,438) 19,180
Reportable segment liabilities (28,789) (6,041) 13,586 (21,244)
Segment capital expenditure - (1) - (1)
-------------------------------- ----------- --------- ------------ ---------
31 December
2011
Property
investment Other Elimination Total
GBP'000 GBP'000 GBP'000 GBP'000
-------------------------------- ----------- --------- ------------ ---------
External revenue 1,544 - - 1,544
Inter-segment revenue - 924 (924) -
-------------------------------- ----------- --------- ------------ ---------
Total segment revenue 1,544 924 (924) 1,544
-------------------------------- ----------- --------- ------------ ---------
Reportable segment profit
/ (loss) from operations
before share-based payments 693 75 (927) (159)
Share-based payments - (2) - (2)
Finance income - 221 (221) -
Finance costs (1,443) (291) 441 (1,293)
-------------------------------- ----------- --------- ------------ ---------
Reportable segment profit
/ (loss) before tax (750) 3 (707) (1,454)
-------------------------------- ----------- --------- ------------ ---------
Depreciation - (17) - (17)
Reportable segment assets 22,750 26,364 (26,325) 22,789
Reportable segment liabilities (28,858) (4,718) 14,565 (19,011)
Segment capital expenditure - - - -
-------------------------------- ----------- --------- ------------ ---------
3 Discontinued operations information
The Group has determined that three lines of business met the
criteria to be treated under IFRS 5 as Non-current assets held for
sale or discontinued operations. The three lines of business
treated as discontinued operations are as follows:
-- The Group's United Kingdom construction and refurbishment
business following the appointment of an Administrator on 19
December 2012
-- The Group's property services business
-- The Group's property fund management business, following the
termination of the contractual arrangement with Speymill Macau
Property Company plc on 28 June 2011
The profit after taxation for the business lines deemed to be
discontinued is shown on the face of the Consolidated Income
Statement and the analysis of this business is shown within this
note. The comparative results have been re-presented
accordingly.
2012 2011
GBP'000 GBP'000
---------------------------------- ---------- ---------
Discontinued operations
Turnover 20,639 31,330
Expenses (23,723) (30,340)
---------------------------------- ---------- ---------
(Loss) / profit before
tax of discontinued operations (3,084) 990
Gain on disposal of discontinued
activities 1,311 -
Taxation (14) 391
---------------------------------- ---------- ---------
(Loss) / profit after
tax from discontinued
operations (1,787) 1,381
---------------------------------- ---------- ---------
Earnings per share (pence) (in accordance with note 7)
Basic earnings per ordinary share (pence) (3.06) 2.37
Diluted earnings per share (pence) (3.06) 2.37
------------------------------------------- ------- -----
The cash flows arising from discontinued or discontinuing
operations are as follows:
Cash flow of discontinued 2012 2011
operations GBP'000 GBP'000
--------------------------- --------- ---------
Operating cash flows (1,698) 19,911
Investing cash flows 1,152 (19,382)
Financing cash flows (31) 183
--------------------------- --------- ---------
Total cash flows (577) 712
--------------------------- --------- ---------
Tax charge in respect
of discontinued
operations
2012 2011
Total Total
GBP'000 GBP'000
------------------------ -------- --------
Foreign income
tax on subsidiary - 7
Previous year's
under / (over)
provision 14 (398)
Total current tax 14 (391)
------------------------ -------- --------
Deferred tax
Original and reversing
of timing differences - -
-------- --------
Total tax charge 14 (391)
------------------------ -------- --------
All of the taxation in respect of discontinued operations
related to overseas operations.
4 Loss from continuing operations
2012 2011
Total Total
GBP'000 GBP'000
------------------------- -------- --------
Operating loss is
stated after charging:
Depreciation:
- owned assets - 17
- leased assets - -
Net foreign exchange
loss - 1
------------------------- -------- --------
Auditors' remuneration:
Audit of parent company
and consolidated
financial statements 37 38
Audit of subsidiary
company financial
statements 18 19
Tax services 23 13
78 70
------------------------- -------- --------
All the above costs have been charged to the income
statement.
5 Net finance costs
2012 2011
Total Total
GBP'000 GBP'000
------------------------ -------- --------
Change in fair
value of derivative
financial instruments 50 (215)
------------------------ -------- --------
50 (215)
------------------------ -------- --------
Bank charges and
interest payable - (12)
Interest charge
on interest bearing
loans (749) (787)
Shareholder loan
interest and facility
fees (347) (279)
Finance lease
charges - -
(1,096) (1,078)
------------------------ -------- --------
Net finance costs (1,046) (1,293)
------------------------ -------- --------
6 Taxation
Tax charge
2012 2011
Total Total
GBP'000 GBP'000
----------------------------- -------- --------
Foreign income tax
on subsidiary - -
Previous year's (over)
/ under provision - -
Total current tax - -
----------------------------- -------- --------
Deferred tax
Original and reversing
of timing differences - -
-------- --------
Total tax charge - -
----------------------------- -------- --------
Factors affecting the tax
charge for the year
2012 2011
Total Total
GBP'000 GBP'000
Loss on ordinary activities
before taxation (4,204) (1,454)
----------------------------- -------- --------
Isle of Man income
tax @ 0% (2011: 0%) - -
Higher rates on overseas
earnings - -
Adjustments in respect
of prior periods - -
Tax expense per the
income statement - -
----------------------------- -------- --------
7 Loss per share on continuing operations
Total Total
2012 2011
GBP'000 GBP'000
----------- ------------
Loss for the year on continuing operations (4,015) (1,415)
---------------------------------------------------------- ----------- ------------
Basic weighted average
number of shares in issue 58,389,555 58,389,555
Employee share options and provisions for share issue - -
Loss per ordinary share on continuing operations (pence) (6.88) (2.42)
Dilutive effect of employee
share options - -
----------- ------------
Diluted loss per share on continuing operations (pence) (6.88) (2.42)
---------------------------------------------------------- ----------- ------------
Reconciliation of continuing operations loss to total loss for
the calculation of loss per share
Total Total
2012 2011
GBP'000 GBP'000
-------- ------------
Loss for the year on continuing operations (4,015) (1,415)
-------------------------------------------------------------------------------- -------- ------------
(Loss)/profit for the year on discontinued operations (1,787) 1,381
-------- ------------
Loss) for the year on all operations attributable to the owners of the Company (5,802) (34)
-------------------------------------------------------------------------------- -------- ------------
8 Property, plant and equipment
Leasehold property
improvements Fixtures and equipment Motor vehicles Total
Group GBP'000 GBP'000 GBP'000 GBP'000
------------------------------ ------------------------------ ----------------------- --------------- --------
Cost
At 1 January 2012 160 140 - 300
Additions - 8 - 8
Disposals - (29) - (29)
Derecognised on disposal of
subsidiary (152) (69) - (221)
Exchange adjustments - - - -
At 31 December 2012 8 50 - 58
------------------------------ ------------------------------ ----------------------- --------------- --------
Depreciation
At 1 January 2012 149 100 - 249
Charge for the year 10 14 - 24
Disposals - (29) - (29)
Derecognised on disposal of
subsidiary (152) (38) - (190)
Exchange adjustments - - - -
At 31 December 2012 7 47 - 54
------------------------------ ------------------------------ ----------------------- --------------- --------
Net book value at 31 December
2012 1 3 - 4
------------------------------ ------------------------------ ----------------------- --------------- --------
At 31 December 2012 the net carrying amount of equipment and
motor vehicles held under finance leases was GBPnil (2011: GBPnil).
Depreciation charged in the year on assets held under finance
leases was GBPnil (2011: GBP1,746).
Leasehold Motor
property improvements Fixtures and equipment vehicles Total
Group GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------ ----------------------- ----------------------- ---------- ----------
Cost
At 1 January 2011 160 449 10 619
Additions - 29 - 29
Disposals - (337) (10) (347)
Exchange adjustments - (1) - (1)
At 31 December 2011 160 140 - 300
------------------------------------ ----------------------- ----------------------- ---------- ----------
Depreciation
At 1 January 2011 110 346 10 466
Charge for the year 39 87 - 126
Disposals - (333) (10) (343)
Exchange adjustments - - - -
At 31 December 2011 149 100 - 249
------------------------------------ ----------------------- ----------------------- ---------- ----------
Net book value at 31 December 2011 11 40 - 51
------------------------------------ ----------------------- ----------------------- ---------- ----------
Leasehold
property Fixtures
improvements and equipment Total
Company GBP'000 GBP'000 GBP'000
------------------------------- -------------- --------------- --------
Cost
At 1 January 2012 1 67 68
Additions - 1 1
Disposals - (29) (29)
At 31 December 2012 1 39 40
------------------------------- -------------- --------------- --------
Depreciation
At 1 January 2012 1 67 68
Charge for the year - 1 1
Disposals - (29) (29)
At 31 December 2012 1 39 40
------------------------------- -------------- --------------- --------
Net book value at 31 December
2012 - - -
------------------------------- -------------- --------------- --------
At 31 December 2012 the net carrying amount of equipment held
under finance leases was GBPnil (2011: GBPnil). Depreciation
charged in the year on assets held under finance leases was GBPnil
(2011: GBP1,746).
Leasehold
property Fixtures
improvements and equipment Total
Company GBP'000 GBP'000 GBP'000
------------------------------- -------------- --------------- -----------
Cost
At 1 January 2011 1 80 81
Additions - - -
Disposals - (13) (13)
At 31 December 2011 1 67 68
------------------------------- -------------- --------------- -----------
Depreciation
At 1 January 2011 1 63 64
Charge for the year - 17 17
Disposals - (13) (13)
At 31 December 2011 1 67 68
------------------------------- -------------- --------------- -----------
Net book value at 31 December
2011 - - -
------------------------------- -------------- --------------- -----------
9 Investment Property
2012 2011
GBP'000 GBP'000
--------------------------------------- -------- --------
Brought forward 22,131 22,626
Additions
- Acquisition through subsidiaries - -
Revaluation of investment properties (3,685) -
Effect of translation to presentation
currency (561) (495)
--------------------------------------- -------- --------
Value of investment property at end
of year 17,885 22,131
--------------------------------------- -------- --------
The fair value of the Group's investment properties at 31
December 2012 was arrived at on the basis of a valuation carried
out as at 31 December 2012, by CBRE GmbH, independent valuers that
are not related to the Group. The valuation most accurately
reflects the value of investment property at the reporting date.
The directors deem this valuation to be relevant and appropriate as
at the year end. CBRE GmbH has appropriate qualifications and
recent experience in the valuation of properties in the relevant
locations.
The valuation, which conforms to International Valuation
Standards, was arrived at by primarily applying a discounted cash
flow analysis to an assessment of the current rental income as well
as an estimate of the future potential net income generated by use
of the properties supported by comparable recent portfolio
transactions on arm's length terms.
Security
At 31 December 2012, there was a first ranking mortgage on the
above properties securing bank loans of GBP14,074,000 (2011:
GBP14,599,000).
10 Subsequent events
As announced today and as detailed in the accompanying circular
document, the directors are proposing to part satisfy the current
shareholder loan through the transfer of the Group's interest in
Horsfield Limited and Wyatt Limited and then to operate the Company
as an investment company.
Under the terms of the transaction proposed, the Group will
transfer its interest in Horsfield Limited and Wyatt Limited to
Burnbrae Limited and Jim Mellon in consideration for a reduction in
the outstanding balance under the current shareholder loan facility
of GBP4.2 million and the payment of GBP300,000 in cash.
It is also proposed, subject to the approval of the transaction
by shareholders, that a new funding facility will be provided by
Galloway Limited (a company related to Jim Mellon and Burnbrae
Limited) to repay the residual balance of the new shareholder loan
and to provide a further facility until 31 July 2014. To allow time
for the required shareholder approval, the current shareholder loan
facility has been extended until 31 August 2013.
11 Audit
The financial information set out above comprises non-statutory
accounts. The financial information for the year ended 31 December
2012 has been extracted from accounts for the year ended 31
December 2012 on which the report of the auditors was unqualified,
but which contained an emphasis of matter as follows:
"Emphasis of matter - going concern
Without qualifying our opinion we draw attention to Note 1.1 to
the consolidated financial statements.
As of 31 December 2012, the Group's liabilities exceeded its
assets by GBP3.1m. The Group incurred a comprehensive loss for the
year of GBP6.1m and the Company incurred a comprehensive loss for
the year of GBP15.3m. The Group is dependent upon the continuing
financial support of its largest shareholder and as a result of
these conditions they have proposed a restructuring exercise, which
is subject to shareholder approval. These conditions, along with
other matters as set forth in Note 1, indicate the existence of a
material uncertainty that may cast significant doubt about the
Group's ability to continue as a going concern."
12 Annual report and financial statements
Copies of the 2012 Annual Report and Financial statements will
be available from the Company' registered office once they have
been posted to shareholders.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR XQLLLXQFEBBF
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