Final Results
16 April 2003 - 9:00AM
UK Regulatory
RNS Number:0883K
Abingdon Capital PLC
16 April 2003
Abingdon Capital plc
Preliminary results for the year ended 31 December 2002
Chairman's Statement
Introduction
Despite the background of challenging trading conditions in 2002 the Group has
made progress towards achieving its goal of becoming an integrated financial
services business.
In particular the Group has:
* merged with Corporate Synergy Holdings plc ("CSH plc")
in July 2002 to create Abingdon Capital;
* established the basis of a hedge fund management
business, initially managing some of the Group's own funds; and
* de-merged a substantial proportion of its investment
portfolio directly to shareholders, so as to leave the Group to concentrate on
revenue producing, rather than asset based activities.
Financial and operating review
Group
The year ended 31 December 2002 represented a transitional year for the Group.
The merger with CSH plc was completed approximately half way through the year,
and the results of the Group only include a contribution from 1 July 2002. For
the year the Group made a loss before tax of #1,096,000 (2001: loss of #789,000)
on turnover of #832,000 (2001: #nil).
As at 31 December 2002, the residual Group investment portfolio was valued at
#871,000, comprising primarily of a variety of small holdings in unquoted,
relatively illiquid or strategic stakes, which will be liquidated over time. At
31 December 2002 the Group had cash balances of #5,033,000.
Corporate Synergy plc ("CS plc")
CS plc had a record year in 2002 despite difficult market conditions and
increased turnover from #2,077,000 for the 12 months ended 30 November 2001 to
#2,349,000 for the thirteen month period ended 31 December 2002. Profit before
tax increased to #656,000 for the 13 month period compared with #526,000 before
tax for the previous 12 months.
Corporate finance had an active year, advising on 14 transactions. Since the
year end CS plc has continued to expand its existing advisory capacity into the
private equity arena. In addition it intends to establish a stockbroking
operation. This will enable the business to offer its existing clients
additional services and target new clients with a broader range of services.
I believe CS plc's results represent a very creditable performance against a
backdrop of difficult market conditions. Nevertheless, 2003 is currently proving
considerably more challenging for advisory businesses in general and I do not
expect it to be able to continue to grow at the rate it has historically
demonstrated.
Mountcashel Management Limited ("MML")
MML has continued to move towards its objective of becoming a regulated hedge
fund management business, built around Paul Spence who was previously deputy
head of Global Equities at Barclays de Zoete Wedd. The trading strategy has been
honed, the systems installed and the regulatory approval process started. It is
likely that reaching the point of managing external funds, will be six months
later than expected, but this is offset by the Group benefiting from positive
investment performance on the principal funds being traded.
Investment Portfolio
As stated at the time of creation of Abingdon Capital, it was the Board's
intention to seek to realise a substantial proportion of the Group's non core
investment portfolio either via a distribution direct to shareholders or through
a managed disposal programme. On 19 December 2002 the Company completed the
disposal of its Biotech interests to shareholders via the sale of investments to
and subsequent demerger of Bionex Investments plc and at the same time its stake
in Redstone plc was also demerged by way of a capital reduction. The Group now
has an investment portfolio of #871,000. This includes an investment of #330,000
in equity and loan capital for a 34.1% stake in M&P Direct plc, the UK's largest
mail order motorcycle parts and accessories business which made a profit before
tax of #154,000 on turnover of #9,358,000 in 2002, its first year under new
management and ownership.
In line with the reduction in the investment portfolio, the Group has also
reduced the costs associated with its management.
Board changes
During the year there have been several changes to the Board. Early in the year
Angus Irens and Ian Hislop resigned to pursue other interests. Tony Caplin left
the Board following the acquisition of CSH plc and at the same time, Jon Pither
joined the board of Abingdon Capital. Jon has since left to pursue other
business interests and I would like to thank him for his contribution.
As a part of the reorganisation of roles and responsibilities, Chris Roberts has
agreed to become Finance Director, with a view to rationalising the finance
function across the entire Group.
Summary and prospects
The current difficult market conditions provide opportunities for expansion and
the Company is proposing to expand the range of its activities beyond corporate
finance and fund management into stockbroking.
2002 was a transitional year and the Group goes into 2003 focused on specific,
and it believes, attainable goals, which should sow the seeds for future
increased shareholder value.
Oliver Vaughan
Chairman
16 April 2003
Consolidated Profit and Loss Account
Year ended 31 December 2002
Continuing 2002
operations
#'000 Acquisition Total 2001
Note #'000 #'000 #'000
Turnover - 832 832 -
Cost of sales (154) (480) (634) -
-------- -------- -------- --------
Gross profit/(loss) (154) 352 198 -
Administrative
expenses:
Exceptional (169) - (169) -
Other (935) (387) (1,322) (2907)
Other operating 44 - 44 2,055
income ======== ======== -------- --------
Profit/(loss) on
ordinary activities
before interest (1,214) (35) (1,249) (852)
-------- --------
Interest receivable and 155 146
similar income
Interest payable and (2) (83)
similar charges
Loss on ordinary -------- --------
activities before
taxation
Taxation (1,096) (789)
- -
-------- --------
Loss for the financial
year transferred to
reserves (1,096) (789)
======== ========
Earnings per share (pence) 1
- Basic (2.5) (2.2)
======== ========
- Diluted 1 (2.3) (2.2)
======== ========
There were no recognised gains or losses other than those included in the profit
and loss account above.
There is no difference between the loss as stated above and that calculated
using the historical cost convention.
Balance Sheets
Year ended 31 December 2002
Group Company
2002 2001 2002 2001
#'000 #'000 #'000 #'000
Fixed assets
Tangible assets 65 18 9 18
Investments - 3,369 4,038 4,863
--------- --------- --------- ---------
65 3,387 4,047 4,881
Current assets
Investments 871 62 489 62
Debtors 1,403 90 1,152 90
Cash at bank and in hand 5,033 5,185 2,845 5,185
--------- --------- --------- ---------
7,307 5,337 4,486 5,337
--------- --------- --------- ---------
Creditors: Amounts falling due
within one year (888) (114) (1,806) (1,610)
--------- --------- --------- ---------
Net current assets 6,419 5,223 2,680 3,727
========= ========= ========= =========
Total assets less current
Liabilities 6,484 8,610 6,727 8,608
========= ========= ========= =========
Capital and reserves
Called up share capital 57 4,511 57 4,511
Share premium 748 32 748 32
Other reserves 2,708 2,744 2,708 2,744
Profit and loss account 2,971 1,323 3,214 1,321
--------- --------- --------- ---------
Equity shareholders' funds 6,484 8,610 6,727 8,608
========= ========= ========= =========
Consolidated Cash Flow Statement
Year ended 31 December 2002
Continuing
operations Acquisition 2002 2001
#'000 #'000 #'000 #'000
Net cash outflow from operating (956) (505)
activities ------- -------
Returns on investment and
servicing of finance
Interest received 99 57 156 141
Interest paid (1) - (1) (81)
Dividends on fixed asset 4 - 4 21
investments -------- -------- ------- -------
102 57 159 81
-------- -------- ------- -------
Taxation paid - (180) (180) -
-------- -------- ------- -------
Capital expenditure and
financial investments
Purchase of tangible fixed (20) - (20) (35)
assets
Purchase of fixed asset - - - (3,397)
investments
Purchase of current asset (2,480) - (2,480) (30)
investments
Sale of fixed asset - - - 7,160
investments
Sale of tangible fixed assets - - - 2,644
Sale of current asset 2,333 256 2,589 -
investments
Grant of loan (200) - (200) (25)
-------- -------- ------- -------
(367) 256 (111) 6,317
-------- -------- ------- -------
Acquisitions and disposals
Cost of purchase of (610) -
subsidiary
Cash acquired with subsidiary 36 -
------- -------
(574) -
------- -------
Cash inflow/(outflow) before
management of liquid resources
and financing (1,662) 5,893
-------- -------- ------- -------
Management of liquid
resources
(Increase)/decrease in short 1,268 461 1,729 (5,000)
term deposits -------- -------- ------- -------
Financing
Draw down/(repayment) of loan - (2,300)
------- -------
Increase/(decrease) in cash in (107) 174 67 (1,407)
the year ======== ======== ======= =======
Notes to the accounts
1. Loss per share
The calculation of the basic loss per ordinary share is based on the loss on
ordinary activities after tax and on the weighted average number of ordinary
shares in issue during the year. The calculation of diluted loss per ordinary
share is based on the basic loss per ordinary share adjusted to allow for the
issue of shares on the assumed conversion of all dilutive options.
Reconciliations of the loss and weighted average number of shares used in the
calculations are set out in the table below.
2002 2001
Weighted Weighted
average number average number
of shares Earnings of shares Earnings
Earnings per share Earnings per share
#'000 pence #'000 pence
Basic loss
per
Ordinary (1,096) 44,712,338 (2.5) (789) 36,087,476 (2.2)
share ======== ======== ======== ======== ======== ========
Dilutive
effect of
securities
- options 2,350,196 477,580
and ======== ======== ======== ======== ========
warrants
Diluted loss
per
Ordinary (1,096) 47,062,534 (2.3) (789) 36,565,056 (2.2)
share ======== ======== ======== ======== ======== ========
2. Financial Information
The financial information contained in this preliminary announcement does not
constitute the Group's statutory accounts, as defined in section 240 of the
Companies Act 1985, for the years ended 31 December 2002 or 31 December 2001.
The accounts for the year ended 31 December 2001 have been delivered to the
Registrar of Companies. The statutory accounts for the years ended 31 December
2001 have been reported on by the Company's auditors; the reports on these
accounts were unqualified and they did not contain any statement under section
237 (2) or (3) of the Companies Act 1985. The statutory accounts for the year
ended 31 December 2002 have not yet been reported on by the Company's auditors.
The auditors confirmed their agreement to this preliminary announcement. The
accounts for the year ended 31 December 2002 will be posted to shareholders in
due course. Further copies will be available from the registered office of
Abingdon Capital plc, 223a Kensington High Street, London W8 6SG.
This information is provided by RNS
The company news service from the London Stock Exchange
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