TIDMQRM
RNS Number : 6957H
Quoram PLC
18 March 2015
QUORAM PLC
INTERIM REPORT
Six months ended 31 December 2014
CHAIRMAN'S STATEMENT
At December 2014 the Group's net assets were just under 0.29
pence per share, an increase from 0.26 pence in June 2014 and 0.25
pence in December 2013. Cash balances declined from GBP1.73m to
GBP1.63m during the period.
During the period the Group completed an extended process of
rationalization, marked by the closure of the Group's office and
its US subsidiaries following expiry of the final Solitaire
licenses earlier in 2014. A consequential reclassification of the
Group's foreign exchange translation reserve resulted in an
accounting gain, which is recognised in the Income Statement under
other income.
Administration costs fell by 76% year on year to GBP68k (2013:
GBP284k). The higher 2013 expenses were somewhat offset by other
revenues of GBP90k relating to the provision of services to third
party clients. A disciplined approach to costs will continue,
however the potential for further reductions is limited. Ongoing
expenses will depend on levels of activity within the investment
portfolio: The low level of ongoing committed expenditure positions
the Group with an ability to be patient while still retaining the
capability to secure investment opportunities when they arise.
The portfolio return benefited from encouraging progress at
Plant Health Care, resulting in an unrealised gain of GBP363k
during the period. Further information on Plant Health Care can be
found at its website (www.planthealthcare.com).
During the period Wessex Exploration Plc changed its name to
Hague and London Oil Plc following the purchase of Hague and London
Oil BV for shares. Quoram's shareholding in the enlarged company
has been diluted to 3.84%, which was valued at GBP111k and is
reported as an asset held for sale on the balance sheet.
Given the discount at which the Group's shares trade to net
asset value, the board has reviewed the potential for share
buybacks as a means of providing liquidity and accreting
shareholder value. However, given the need to complete a process of
share capital reduction it was concluded that the cost of such an
exercise was likely to outweigh the potential benefits.
Outlook
While Quoram benefits from a low cost base and simple corporate
structure, it retains the capacity to execute further investment
opportunities when they arise on appropriate terms. Combined with a
strong liquidity position, the Group is in a robust position and
will inform investors of future developments when they arise.
Enquiries :
Quoram Plc
James Ede-Golightly, Chairman +44 (0) 1481738723
WH Ireland Limited (Nominated adviser)
John Wakefield, Corporate Finance +44 (0) 117 945 3470
STRATEGIC REPORT
Strategy and business objectives
Quoram's objectives are to identify investment opportunities
offering the potential to deliver value creation to shareholders
over the medium to long term, as measured by growth in net asset
value (NAV) after adjusting for distributions. Depending on
specific circumstances, investments may range from minority
shareholdings to the acquisition of wholly owned trading
subsidiaries, and such investments may be quoted or unquoted.
Acquisitions or investments may be funded through the issue of new
Ordinary Shares, debt or from the Group's existing cash resources.
The Board will have full discretion to focus the Group's investment
resource around those opportunities it has identified as offering
the best potential for value creation. The full strategy is set out
under section 3 of the circular dated 18 March 2013 which was
approved by shareholders at a general meeting held on 11 April
2013.
The Board are actively pursuing opportunities to increase
shareholder value.
Results
The profit for the six month period to 31 December 2014 was
GBP1,351k (2013: loss of GBP778k).
Business Review
A review of the Group's performance and future prospects is
contained in the Chairman's Statement on page 2.
Development and performance
The Group's Investments performed well in the first half of the
year, with a total unrealised investment gain of GBP307k.
The board is increasingly focused on identifying a small number
of strategic investment opportunities. The board continues to
review such opportunities and will update shareholders when further
investments are made. With a significant proportion of the balance
sheet in cash and a low overhead, the Group is well positioned to
capitalise on opportunities as they arise.
Position at year end
The Group finished the period with cash and cash equivalent
balances of GBP1.63 million (2013: GBP1.76 million). Net assets at
31 December 2014 were GBP2.76 million compared to GBP2.43 million
at 31 December 2013.
Key performance indicators
The key indicators of performance for the business in its
current stage are the financial performance of its Portfolio
Investments. The Group recognised an unrealised gain of GBP307k in
the six months to 31 December 2014 compared to an unrealised total
comprehensive loss of GBP590k in the six months to 31 December
2013.
The control of overhead spend is also of high importance to
ensure the Group is being managed efficiently. Budgets are
monitored closely to ensure adequate financial resources are
available to meet financial commitments as they arise. Total
administrative expenses for the six month period were GBP68k
compared to GBP284k in the comparative period.
Net assets per share is an important indicator of the Group's
financial performance. The net assets per share increased from
0.25p at 31 December 2013 to 0.29p at 31 December 2014, mainly
reflecting the increase in the value of Portfolio Investments held
during the period.
Principal risks and uncertainties
The Group considers that the principal risks to achieving its
business objectives are as follows:
Market risk
The main risk arising from the Group's operations are market
price risk associated with its Portfolio Investment assets. The
Director's review and agree policies for managing risk at least
annually. The directors believe that they have mitigated these
risks as far as reasonably practicable - by maintaining a rigorous
investment appraisal and asset monitoring procedure and continually
reviewing and seeking to improve such controls as well as business
processes and procedures.
Funding
The Group has GBP1.63 million of cash and cash equivalents as at
31 December 2014. The Directors believe that this is sufficient to
allow them to execute the Investment Policy flexibly in the coming
years. However, were significant un-foreseen expenses to arise,
additional finance may be required. The Board try to mitigate this
risk by regularly reviewing budgets and analysing future cash
requirements.
On behalf of the Board
James Ede-Golightly
18 March 2015
CONDENSED CONSOLIDATED INCOME STATEMENT
(Unaudited) (Unaudited) (Audited)
Six months ended 31 December 2014 Six months ended 31 December 2013 Year ended 30 June 2014
Notes GBP'000 GBP'000 GBP'000
-------------------- ------ ----------------------------------------- ------------------------------------------ ----------------------------------
Continuing
operations:
Portfolio
investment return 363 (266) (55)
Impairment of
available-for-sale
investments (56) (324) (306)
Other income 2 1,108 90 181
-------------------- ------
Portfolio return
and revenue 1,415 (500) (180)
-------------------- ------ ----------------------------------------- ------------------------------------------ ----------------------------------
Administrative
expenses (68) (284) (517)
Total
administrative
expenses (68) (284) (517)
-------------------- ------ ----------------------------------------- ------------------------------------------ ----------------------------------
Operating
profit/(loss) 1,347 (784) (697)
-------------------- ------ ----------------------------------------- ------------------------------------------ ----------------------------------
Finance income 4 6 9
Profit/(loss)
before taxation 1,351 (778) (688)
-------------------- ------ ----------------------------------------- ------------------------------------------ ----------------------------------
Taxation - - -
-------------------- ------ ----------------------------------------- ------------------------------------------ ----------------------------------
Profit/(loss) for
the financial
period 1,351 (778) (688)
-------------------- ------ ----------------------------------------- ------------------------------------------ ----------------------------------
Attributable to:
Equity shareholders
of the Group
-------------------- ------ ----------------------------------------- ------------------------------------------ ----------------------------------
1,351 (778) (688)
-------------------- ------ ----------------------------------------- ------------------------------------------ ----------------------------------
Earnings/(loss) per
share 3
Basic and diluted
earnings/(loss)
per share (pence) 0.14 (0.08) (0.07)
-------------------- ------ ----------------------------------------- ------------------------------------------ ----------------------------------
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
(Unaudited) (Unaudited and restated) (Audited)
Six months ended 31 Six months ended 31 December
December 2014 2013 Year ended 30 June 2014
GBP'000 GBP'000 GBP'000
----------------------------- ---------------------------- ----------------------------- --------------------------
Profit/(loss) for the
financial period 1,351 (778) (688)
Other comprehensive income
Reclassification of foreign
exchange on consolidation to
profit or loss (1,108) - -
Effects of foreign exchange
on consolidation - (3) (7)
----------------------------- ---------------------------- ----------------------------- --------------------------
Other comprehensive income
for the financial period,
net of tax (1,108) (3) (7)
----------------------------- ---------------------------- ----------------------------- --------------------------
Total comprehensive income
for the financial period 243 (781) (695)
----------------------------- ---------------------------- ----------------------------- --------------------------
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
(Unaudited) (Unaudited and restated) (Audited)
Six months ended 31 Six months ended 31
December 2014 December 2013 Year ended 30 June 2014
Notes GBP'000 GBP'000 GBP'000
--------------------------- ------ -------------------------- --------------------------- ------------------------
Assets
Non-current assets
Available-for-sale
financial assets 111 149 167
Portfolio investments 996 422 633
--------------------------- ------ -------------------------- --------------------------- ------------------------
Total portfolio
investments held 1,107 571 800
--------------------------- ------ -------------------------- --------------------------- ------------------------
Current assets
Trade and other
receivables 40 137 18
Cash and cash equivalents 1,631 1,755 1,734
--------------------------- ------ -------------------------- --------------------------- ------------------------
1,671 1,892 1,752
--------------------------- ------ -------------------------- --------------------------- ------------------------
Total assets 2,778 2,463 2,552
--------------------------- ------ -------------------------- --------------------------- ------------------------
Liabilities
Current liabilities
--------------------------- ------ -------------------------- --------------------------- ------------------------
Trade and other payables (15) (29) (32)
--------------------------- ------ -------------------------- --------------------------- ------------------------
Total liabilities (15) (29) (32)
--------------------------- ------ -------------------------- --------------------------- ------------------------
Net assets 2,763 2,434 2,520
--------------------------- ------ -------------------------- --------------------------- ------------------------
Capital and reserves
attributable to the
Group's equity
shareholders:
Share capital 4 2,420 2,420 2,420
Share premium account 3,813 3,813 3,813
Foreign exchange
translation reserve - 1,112 1,108
Retained earnings (3,470) (5,785) (5,695)
Share-based payment
reserve - 874 874
--------------------------- ------ -------------------------- --------------------------- ------------------------
Total equity 2,763 2,434 2,520
--------------------------- ------ -------------------------- --------------------------- ------------------------
The financial statements were approved by the Board of
Director's on 18 March 2015 and were signed on its behalf by:
James Ede-Golightly
Chairman
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Foreign
exchange
Share premium translation Retained Share based
Share capital account reserve earnings payment reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------ -------------- ----------------- ---------------- ----------------- ---------------- --------
Balance at 1 July
2013 2,420 3,813 1,115 (5,007) 874 3,215
Loss for the
financial period - - - (778) - (778)
Other
comprehensive
income
Effects of
foreign exchange
on consolidation - - (3) - - (3)
------------------ -------------- ----------------- ---------------- ----------------- ---------------- --------
Total
comprehensive
income - - (3) (778) - (781)
Balance at 31
December 2013 2,420 3,813 1,112 (5,785) 874 2,434
------------------ -------------- ----------------- ---------------- ----------------- ---------------- --------
Balance at 1
January 2014 2,420 3,813 1,112 (5,785) 874 2,434
Profit for the
financial period - - - 90 - 90
Other
comprehensive
income 0
Effects of
foreign exchange
on consolidation - - (4) - - (4)
------------------ -------------- ----------------- ---------------- ----------------- ---------------- --------
Total
comprehensive
income - - (4) 90 - 86
Balance at 30
June 2014 2,420 3,813 1,108 (5,695) 874 2,520
------------------ -------------- ----------------- ---------------- ----------------- ---------------- --------
Balance at 1 July
2014 2,420 3,813 1,108 (5,695) 874 2,520
Transfer to
Retained
earnings - - - 874 (874) -
Profit for the
financial period - - - 1,351 - 1,351
Other
comprehensive
income
Reclassification
of foreign
exchange on
consolidation to
profit or loss - - (1,108) - - (1,108)
------------------ -------------- ----------------- ---------------- ----------------- ---------------- --------
Total
comprehensive
income - - (1,108) 1,351 - 243
Balance at 31
December 2014 2,420 3,813 - (3,470) - 2,763
------------------ -------------- ----------------- ---------------- ----------------- ---------------- --------
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited
(Unaudited) and restated) (Audited)
Six months Six months
ended 31 ended 31 Year ended
December December 30 June
2014 2013 2014
GBP'000 GBP'000 GBP'000
----------------------------------- ------------ --------------- -----------
Cash outflow from operating
activities (107) (242) (266)
------------------------------------ ------------ --------------- -----------
Cash flow used in investing
activities
Interest received 4 6 9
------------------------------------ ------------ --------------- -----------
Net cash flow from investing
activities 4 6 9
------------------------------------ ------------ --------------- -----------
Net increase / (decrease) in cash
and cash equivalents (103) (236) (257)
Cash and cash equivalents
at beginning of period 1,734 1,991 1,991
------------------------------------ ------------ --------------- -----------
Cash and cash equivalents
at end of the period 1,631 1,755 1,734
------------------------------------ ------------ --------------- -----------
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Accounting policies
Basis of preparation
These condensed half yearly financial statements are for the six
month period ended 31 December 2014.
The financial information for the six months ended 31 December
2014 and 31 December 2013 is unaudited. The financial information
for the six months ended 31 December 2013 has been amended to
reflect the share based payment charge which should have been
recognized therefore the loss for the period has been adjusted by
GBP11,000.
IFRS is subject to amendment and interpretation by the
International Accounting Standards Board ("IASB") and the IFRS
Interpretations Committee and there is an ongoing process of review
and endorsement by the European Commission.
The financial information has been prepared on the basis of IFRS
that the Directors expect to be applicable as at 30 June 2015, with
the exception of IAS 34 Interim Financial Reporting.
Financial information contained in this document does not
comprise the Group's statutory financial statements as defined in
section 434 of the Companies Act 2006.
The statutory financial statements for the year ended 30 June
2014 have been delivered to the Registrar of Companies. The
auditors reported on these financial statements: their report was
unqualified, did not contain a statement under section 498(2) or
498(3) of the Companies Act 2006, and did not include references to
any matters to which the auditor drew attention by way of
emphasis.
2. Liquidation of subsidiary companies
During the period the Group completed an extended process of
rationalization resulting in the striking-off of the two US
incorporated subsidiaries. The net gains on foreign exchange
recognized in relation to the US entities have therefore been
reclassified to profit or loss in the period. There are no
subsidiary companies as at 31 December 2014 but the results of the
former subsidiaries to the date of liquidation are included.
3. Loss per share attributable to the equity shareholders of the Company
(Unaudited) (Unaudited) (Audited)
Six months ended 31 December Six months ended 31 December
2014 2013 Year ended 30 June 2014
Pence Pence Pence
------------------------------ ----------------------------- ----------------------------- ------------------------
Earnings/(loss) per share
from continuing operations 0.14 (0.08) (0.07)
------------------------------ ----------------------------- ----------------------------- ------------------------
The losses and weighted average number of ordinary shares used
in the calculation of basic loss per share are as follows:
GBP'000 GBP'000 GBP'000
------------------------------------------------------ ------------ ------------ ------------
Profit/(loss) used in the calculation of
basic earnings/(loss) per share from continuing
operations 1,351 (778) (688)
------------------------------------------------------ ------------ ------------ ------------
Number of share (Unaudited) (Unaudited)
Six months Six months (Audited)
ended 31 ended 31 Year ended
December December 30 June
2013 2013 2014
------------------------------------------------------
Weighted average number of ordinary shares
for the purposes of basic and diluted profit/(loss)
per share 968,196,408 968,196,408 968,196,408
------------------------------------------------------ ------------ ------------ ------------
The Company has issued options over 14,675,215 ordinary shares
which are potentially dilutive. There is however no dilutive effect
of these issued options as the average share price for the period
is below the exercise price of the options.
4. Share Capital
(Unaudited) (Unaudited) (Audited)
Six months ended 31 December Six months ended 31 December
2014 2013 Year ended 30 June 2014
GBP'000 GBP'000 GBP'000
------------------------------ ----------------------------- ----------------------------- ------------------------
Allotted, issued and fully
paid
968,196,408 shares of 0.25
pence 2,420 2,420 2,420
------------------------------ ----------------------------- ----------------------------- ------------------------
5. Related Parties
Consultancy fees were invoiced to ORA Capital Partners Limited
(a company controlled by a significant shareholder which at 31
December 2014 held 24.12% of the Company's issued share capital) as
follows;
(Unaudited) (Unaudited) (Audited)
Six months ended 31 December 2014 Six months ended 31 December 2013 Year ended 30 June 2014
GBP'000 GBP'000 GBP'000
------------------ ----------------------------------- ---------------------------------- ------------------------
Consultancy fees - 53 144
------------------ ----------------------------------- ---------------------------------- ------------------------
The directors, having consulted the Company's nominated adviser,
confirm their opinion that these arrangements, which are with
related parties, are fair and reasonable insofar as the interests
of shareholders are concerned.
6. Copies of the Interim Report
A copy of this Interim Report is now available on the Company's
website at www.quoram.co.uk
This information is provided by RNS
The company news service from the London Stock Exchange
END
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