TIDMAMP
RNS Number : 7234X
Amphion Innovations PLC
20 August 2009
Amphion Innovations plc
Interims Results for the 6 months to 30 June 2009
London and New York, 20 August 2009 - Amphion Innovations plc (LSE: AMP)
("Amphion" or the "Company"), the developer of medical and technology
businesses, today announces its unaudited interim results for the six months to
30 June 2009.
Highlights
* Net Asset Value per Share was approximately unchanged versus December 2008 at US
$0.44, but down 15.38% since June 2008 (US $0.52). In sterling terms, the NAV
per Share increased by 3.85% to GBP0.27 over the levels of June 2008 (GBP0.26),
a 10% decrease since December 2008 (GBP0.30)
* Operating results improved sharply from a loss of over US $1.73 million in the
first half of 2008, to very close to breakeven for the first half of 2009
* DataTern, Inc. signed 7 non-exclusive patent license agreements during the first
half of 2009, with an additional license agreement concluded in July. In August,
the United States Patent and Trademark Office found DataTern's '502 patent valid
for all 18 original claims and 26 new claims after re-examination. DataTern has
now signed a total of 11 license agreements, bringing its total revenues since
inception to approximately US $9.4 million
* Received a further subscription of GBP716,900 bringing the total to GBP3.5
million for Amphion's Convertible Promissory Note, launched to support funding
for Amphion and the Partner Companies
Amphion's Chief Executive Officer, Richard Morgan, said:
"I am pleased to announce that Amphion has managed to weather the economic and
financial storm of the last six months relatively well, with a near breakeven
versus the US $1.73 million operating loss for the first half of 2008. We have
also made good progress in the development of our IP licensing programme through
DataTern, which has established itself as a significant source of revenue for
Amphion.I am excited by the value that is being created in each of our Partner
Companies and remain confident in the strength of the Amphion model."
Amphion Innovations plc+1 212 210 6224
Charlie Morgan
Cardew Group+44 20 7930 0777
Tim Robertson
James Milton
Matthew Law
Charles Stanley Securities (Nominated Adviser) +44 20 7149 6000
Mark Taylor
Freddy Crossley
Notes to editors
About Amphion Innovations plc
Amphion Innovations plc (LSE: AMP) builds shareholder value in high growth
companies in the medical and technology sectors, by using a focused, hands-on
company building approach, based on decades of experience in both the US and UK.
Amphion has significant shareholding in 8 Partner Companies and two specialised
entities, developing proven technologies targeting substantial commercial
marketplaces, each in excess of US $1 billion. Each Partner Company is chosen
with the goal of achieving an exit valuation in excess of US $100 million.
On the web: www.amphionplc.com
CEO's Statement
Amphion has managed to weather the economic and financial turbulence of the last
six months relatively well. Our Net Asset Value per Share has remained largely
unchanged in this period and was US $0.44 at the end of June, a similar position
to the end of December 2008. This is the result of the majority of our assets
being unchanged in value as expressed in US dollars, with the reduction in the
valuation of Myconostica being offset by increases in the dollar value of Kromek
and some of our other assets. In sterling terms, the NAV per Share fell slightly
over the period as sterling recovered by 12.5% over the six months.
As we observed in the AGM statement, it is possible that the valuation of one or
more of our individual assets will be reduced, given the significant fall in the
broader capital markets in the last year or so, but we believe the significance
of the effect on our NAV will be muted. This is due in part to our confidence in
the valuation of our holding of Kromek, which continues to make progress and
which has successfully raised additional capital in recent months at the same
valuation of GBP8 per share. At the end of June, Kromek accounted for 24.8% of
the total value of Amphion's assets. In addition, our holdings of convertible
debt in our eight Partner Companies reached US $8.1 million at 30 June 2009 and
thus constituted 12.4% of the total value of our assets. Lastly, it is important
to keep in mind that the intrinsic nature of the Partner Companies we help start
and build is one of rapid and dynamic growth. In normal economic and financial
conditions the inherent value of any one of these companies has gone up by a
significant percentage each year for many years, usually a multiple of the
capital we invest in them. To us, therefore, standing still is an unnatural act,
even if it is considered to be an accomplishment in difficult conditions like
these.
When Amphion starts or supports the start of a new company, we only commit after
we are satisfied that the foundation of the company, particularly its
intellectual property, is sound. We look for large unmet market needs and
strong, proven technology that will bring innovative solutions to fill a
substantial and well-defined need. However, without capital to grow, our model
cannot be successful and it is particularly significant that we are now able to
generate a proportion of this through DataTern's growing IP licensing
programme. In the first half of the year, we concluded an additional seven
license agreements to the ORM technology, bringing the total number of licensees
at mid-year to eleven. We continue to make progress in this area, with one more
license concluded in July and with several others in active negotiation. In
August, the United States Patent and Trademark Office found DataTern's '502
patent valid for all 18 original claims and 26 new claims after
re-examination.DataTern's gross licensing income in the first half of 2009 was
US $3.4 million, and we are confident the outcome for the second half of 2009
should be at least equal to that of the first six months.
As we have said previously, we believe it should be possible to reduce
administrative expenses and increase revenue to the point where we are able to
cover most, if not all, of our operating costs at the Amphion level. The
revenue level was down slightly compared with the first six months of last year,
but the gross profit on this revenue was higher. Administrative expenses were
lower and as a result operating results improved sharply from an operating loss
of over US $1.73 million in the first half of 2008, to a very near operating
breakeven.
Despite the progress we have made with our licensing programme, we have not yet
reached the point where our financial resources are sufficient to finance the
growth of our Partner Companies. Since Amphion's IPO in 2005 we have advised
that we would only reach that point when we are able to generate liquidity from
the sale or flotation of at least one of our companies (beyond Beijing
MedPharm). This has been put on hold following the events of last year and our
plans to list two of our companies were postponed. However, given the
improvement in the broader capital markets in recent months, we are now once
again working on possible IPO's for two or three of the Partner Companies. At
this point, the IPO markets remain subdued but our aim is to be prepared for
when conditions are more favorable which means that our Partner Companies remain
well placed for either a trade sale or an IPO.
We have, therefore, decided to raise additional capital through the further
issuance of Convertible Promissory Notes in order to support our Partner
Companies and maintain our ownership position in each one. We raised GBP2.8
million through these notes by the mid-year point and an additional GBP716,900
since then, bringing the current total to GBP3.5 million. Our goal is to cap the
issuance of convertible notes at GBP7 million, which would represent a modest
level of debt to total assets of about 18%. We will use proceeds from this
convertible note issuance primarily for investment in our Partner Companies.
Although raising capital in this way imposes additional dilution on our
shareholders, the effect is largely offset by our being able to manage and
maintain the level of ownership of each individual company. As a result, we
continue to believe the net effect of this programme will be positive for our
shareholders.
In previous economic downturns, the recovery in the private capital markets has
lagged the recovery in the broader stock market by six to twelve months and we
do not believe recovery in this cycle will be quicker. As a result, we remain
cautious in the management of our business. However, we have eight promising
Partner Companies and each has made progress in the last six months, despite the
difficult environment. Seven of the eight companies are now generating revenue,
albeit still at rather modest levels, but for a startup company to ship products
and make the transition to a revenue generating business is a significant
achievement. The next challenge is to increase sales to the point where we show
first an accounting profit and then positive cash flow. We remain committed to
helping our Partner Companies meet these challenges and make the transition to
profitable businesses. We try to minimise the amount of time and effort spent on
trying to "engineer" outcomes or "exits", in the belief that if we build good,
well-run companies, the opportunity to complete an IPO will present itself in
due course.
We are excited by the value that is being created in our Partner Companies and
believe that our shareholders should benefit when this value creation is
released in due course. Despite the events of the last year, I am pleased to
report that we have weathered the storm well so far and remain confident in our
approach. We believe that we should be able to get back on a growth track by the
end of the year and do well once capital markets recover.
Partner Companies
+--------------------+--------------------------------------------------------
=--+
| Company | Company Description
|
+--------------------+-----------------------------------------------------
=-----+
| Axcess | RFID Systems
|
+--------------------+-----------------------------------------------------
=-----+
| DataTern | Intellectual Property Development
|
+--------------------+-----------------------------------------------------
------+
| FireStar | Software platform for inter-enterprise
integration
|
+--------------------+-----------------------------------------------------
=-----+
| Kromek | Digital x-ray systems for medical and security
|
| | applications
|
+--------------------+-----------------------------------------------------
=-----+
| m2m | MRI coils & tools for clinical and research use
|
+--------------------+-----------------------------------------------------
------+
| Motif | Population genetics for pharmaceuticals &
diagnostics
|
+--------------------+-----------------------------------------------------
=-----+
| Myconostica | Molecular diagnostics for fungal diseases
|
+--------------------+-----------------------------------------------------
=-----+
| PrivateMarkets | Online energy trading marketplace
|
+--------------------+-----------------------------------------------------
=-----+
| WellGen | Nutrigenomics for health and wellness
|
+--------------------+-----------------------------------------------------
------+
Amphion's Partner Companies continue to make progress.
Axcess (OTCBB: AXSI), announced in February that it won a competitive
procurement worth US $3.54 million to provide security infrastructure solutions
for the port at Trinidad's capital, Port-of-Spain. With the security
successfully implemented, in April Trinidad hosted the Fifth Summit of the
Americas Conference attended by over 30 heads of state of countries from North,
Central and South America, and the Caribbean.Axcess has also recently reported
record revenues for the first half of 2009. Amphion's fully-diluted ownership
stake in Axcess was 8.50% as of 30 June 2009, valued at US $2.0 million (June
2008: US $3.2 million).
DataTern signed seven additional license agreements in the six months to June,
with one more license concluded in July and with several others in active
negotiation. To date, DataTern has signed 11 license agreements for total
revenues of US $9.4 million since June 2008. The gross licensing income in the
first half of 2009 was US $3.4 million, slightly ahead of plan, and we are
confident the outcome for the second half of 2009 should be at least equal to
that of the first six months. In August, the United States Patent and Trademark
Office found DataTern's '502 patent valid for all 18 original claims and 26 new
claims after re-examination. Amphion's fully-diluted ownership stake in
DataTern was 100% as of 30 June 2009. As DataTern is 100% owned by Amphion, it
is consolidated into Amphion's financial statements.
FireStar is making progress working with several leading organisations on
establishing the new payments standard for messaging in the financial sector.
EdgeNode(TM) (the proprietary engine supporting the PrivateMarkets platform)
offers unique functionality for messaging in both the financial payments sector
and in healthcare. FireStar developed new revenue streams for services and
EdgeNode(TM) technologies in the Financial Services market during the first half
of 2009. The company anticipates growing this revenue stream in the second half
of 2009 as well as beginning a new revenue stream based on EdgeNode(TM) in the
secure electronic distribution of medical records. Amphion's fully-diluted
ownership stake in FireStar was 15.32% as of 30 June 2009, valued at US $4.5
million (June 2008: US $4.7 million).
Kromek's first product, the Bottle Scanner, was shipped to Newcastle Airport and
began trials in June, when they also launched their second product, the 3-1-1
Scanner, at the Transec World Expo in Amsterdam. Also in June, Dr. Arnab Basu,
Kromek's CEO, was awarded Ernst & Young Entrepreneur of the Year 2009 for the
North and Midlands region. Kromek recently announced the award of a US $4
million contract from the US Defense Threat Reduction Agency (DTRA) for the
development of Detectors from Vapour Grown Cadmium Zinc Telluride
material. Amphion's fully-diluted ownership stake in Kromek was 19.99% as of 30
June 2009, valued at US $16.2 million (June 2008: US $19.6 million).
m2m has continued to see good demand for its current product range of
preclinical coils. m2m is a key supplier to Bruker Biospin, Siemens, Varian, GE,
and other major imaging system manufacturers, and also provides solutions to
GSK, Merck, BMS, Astra Zeneca, Roche, and most university research organisations
in the US and Europe. The company continues development work on its first
cryogenic coil, for the preclinical market. Amphion's fully-diluted ownership
stake in m2m was 24.40% as of 30 June 2009, valued at US $6.9 million (June
2008: US $6.0 million).
Motif has made good progress mining the very rich dataset in a Moroccan cohort
in partnership with Imperial College London and Professor Philippe Froguel. The
company believes it has already made several important discoveries in diabetes
and hypertension and believes that these, along with additional discoveries from
our ongoing research, will result in important Intellectual Property. Amphion's
fully-diluted ownership stake in Motif was 38.55% as of 30 June 2009, valued at
US $15.7 million (June 2008: US $14 million).
Myconostica currently has two products on the market; the MycXtra(TM) fungal DNA
extraction system and MycAssayTM Pneumocystis, a real-time PCR test for
Pneumocystis jirovecii, one of the most common causes of fungal pneumonia.
Myconostica has a pipeline of products in development including a test for the
detection of Aspergillus and a microarray-based assay for the identification of
yeast species. Amphion's fully-diluted ownership stake in Myconostica was 22.14%
as of 30 June 2009, valued at US $2.3 million (June 2008: US $5.8 million).
PrivateMarkets began commercial operations in the ERCOT/Texas region of the
U.S. wholesale electricity market, achieving first revenues and early growth of
trading volumes that, while still small, is ahead of plan. The company
anticipates continuing to expand its presence in the Texas market and plans to
launch an expansion into other parts of the U.S. market in the second half of
2009. Amphion's fully-diluted ownership stake in PrivateMarkets was 25.34% as of
30 June 2009, valued at US $4.6 million (June 2008: US $3.2 million).
WellGen announced the appointment of Dr. Roddy Carter as President and CEO in
April 2009. In May, the company launched its first four consumer products into
the nutritional supplement market under the brand name Te Amé. Preclinical
testing of WellGen's first candidate product for the medical foods market
continues with encouraging results thus far. Development work on the next two
proprietary products is also making good progress. Amphion's fully-diluted
ownership stake in WellGen was 14.56% as of 30 June 2009, valued at US $6.6
million (June 2008: US $6.7 million).
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| Amphion Innovations plc | | | | | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| Condensed consolidated income | | | | | |
| statement | | | | | |
+-------------------------------------------------------+----------------------+--------+---------------------+--------+---------------------------+
| For the six months ended | | | | | | |
| 30 June 2009 | | | | | | |
+------------------------------------------------+------+----------------------+--------+---------------------+--------+---------------------------+
| | | | | | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| | | | | | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| Unaudited | | | | | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| | | | | | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| | | Notes | | Six months | | Six months | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| | | | | ended | | ended | | Year ended |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| | | | | 30 June 2009 | | 30 June 2008 | | 31 December 2008 |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| Continuing operations | | | | US$ | | US$ | | US$ |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| | | | | | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| Revenue | | 3 | | 4,010,503 | | 5,385,966 | | 7,087,944 |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| Cost of sales | | 3 | | (1,398,420) | | (3,237,562) | | (3,676,250) |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| Gross profit | | | | 2,612,083 | | 2,148,404 | | 3,411,694 |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| | | | | | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| Other operating income | | | | | | - | | 7,000 |
| | | | | - | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| Administrative expenses | | | | (2,634,387) | | (3,882,771) | | (6,799,792) |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| | | | | | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| Operating loss | | | | (22,304) | | (1,734,367) | | (3,381,098) |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| | | | | | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| Fair value | 7 | | (146,832) | | 11,800,211 | | 1,967,216 |
| gains (losses) | | | | | | | |
| on investments | | | | | | | |
+---------------------------------------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| Interest income | | | | 188,959 | | 135,457 | | 274,788 |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| Other gains and losses | | | | 21,043 | | (10,958) | | (22,433) |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| Finance costs | | | | (148,198) | | (1,787) | | (29,878) |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| | | | | | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| Profit (loss) before tax | | | | (107,332) | | 10,188,556 | | (1,191,405) |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| | | | | | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| Tax on profit | | 5 | | (87,000) | | (165,792) | | (13,130) |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| | | | | | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| Profit (loss) for the period | | | | (194,332) | | 10,022,764 | | (1,204,535) |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| | | | | | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| | | | | | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| | | | | | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| | | | | | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| Earnings per share | | 6 | | | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| | | | | | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| Basic | | | US | $ | US | $ 0.08 | US | $ (0.01) |
| | | | | (0.00) | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| | | | | | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| Diluted | | | US | $ | US | $ 0.08 | US | $ (0.01) |
| | | | | (0.00) | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| | | | | | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| | | | | | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
| | | | | | | | | |
+------------------------------+--------+--------+------+----------------------+--------+---------------------+--------+---------------------------+
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
| Amphion Innovations plc | | | | | | |
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
| Condensed consolidated statement of comprehensive income | | |
+----------------------------------------------------------------------------------------------------------+-----------+-------------------+
| For the six months ended 30 June 2009 | | | | | | |
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
| | | | | | | |
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
| | | | | | | |
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
| | | | | | | |
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
| | | | | | | |
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
| | | | | | | |
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
| | | Six months | | Six months | | |
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
| | | ended | | ended | | Year ended |
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
| | | 30 June 2009 | | 30 June 2008 | | 31 December 2008 |
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
| | | US$ | | US$ | | US$ |
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
| | | | | | | |
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
| | | | | | | |
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
| Profit (loss) for the period | | (194,332) | | 10,022,764 | | (1,204,535) |
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
| | | | | | | |
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
| Other comprehensive income | | | | | | |
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
| | | | | | | |
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
| Exchange differences arising on translation | | | | | | |
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
| of foreign operations | | 39,955 | | (953) | | (41,248) |
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
| | | | | | | |
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
| Other comprehensive income for the period | | 39,955 | | (953) | | (41,248) |
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
| | | | | | | |
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
| Total comprehensive income for the period | | (154,377) | | 10,021,811 | | (1,245,783) |
+---------------------------------------------+-----------+-----------------+-----------+------------------+-----------+-------------------+
+-------------+--------+--------+--------+--------+--------+---------------+
| Amphion | | | | | |
| Innovations | | | | | |
| plc | | | | | |
+-------------+-----------------+--------+--------+--------+---------------+
| Condensed consolidated statement of | | |
| financial position | | |
+-------------------------------------------------+--------+---------------+
| At 30 | | | | | |
| June | | | | | |
| 2009 | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| | | | Unaudited | | Audited |
+-------------+--------+--------+-----------------+--------+---------------+
| | Notes | | 30 June 2009 | | 31 |
| | | | | | December |
| | | | | | 2008 |
+-------------+--------+--------+-----------------+--------+---------------+
| | | | US$ | | US$ |
+-------------+--------+--------+-----------------+--------+---------------+
| | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| Non-current | | | | | |
| assets | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| Intangible | | | 2,020,501 | | 2,150,415 |
| assets | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| Property, | | | 19,952 | | 19,726 |
| plant and | | | | | |
| equipment | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| Security | | | 121,694 | | 121,694 |
| deposit | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| Investments | 7 | | 60,202,949 | | 59,029,932 |
+-------------+--------+--------+-----------------+--------+---------------+
| | | | 62,365,096 | | 61,321,767 |
+-------------+--------+--------+-----------------+--------+---------------+
| | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| Current | | | | | |
| assets | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| Prepaid | | | 2,349,968 | | 1,566,911 |
| expenses | | | | | |
| and | | | | | |
| other | | | | | |
| receivables | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| Cash | | | 365,134 | | 630,404 |
| and | | | | | |
| cash | | | | | |
| equivalents | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| | | | 2,715,102 | | 2,197,315 |
+-------------+--------+--------+-----------------+--------+---------------+
| | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| Total | | | 65,080,198 | | 63,519,082 |
| assets | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| Current | | | | | |
| liabilities | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| Trade | | | 2,297,755 | | 1,952,779 |
| and | | | | | |
| other | | | | | |
| payables | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| Non-current | | | | | |
| liabilities | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| Convertible | 8 | | 4,182,274 | | 3,279,950 |
| promissory | | | | | |
| notes | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| Trade | | | 1,077,546 | | 1,140,739 |
| and | | | | | |
| other | | | | | |
| payables | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| | | | 5,259,820 | | 4,420,689 |
+-------------+--------+--------+-----------------+--------+---------------+
| | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| Total | | | 7,557,575 | | 6,373,468 |
| liabilities | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| Net | | | 57,522,623 | | 57,145,614 |
| assets | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| Equity | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| Share | 9 | | 2,448,303 | | 2,429,342 |
| capital | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| Share | | | 36,803,687 | | 36,291,262 |
| premium | | | | | |
| account | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| Translation | | | 1,567 | | (38,388) |
| reserve | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| Retained | | | 18,269,066 | | 18,463,398 |
| earnings | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| | | | | | |
+-------------+--------+--------+-----------------+--------+---------------+
| Total | | | 57,522,623 | | 57,145,614 |
| equity | | | | | |
+-------------+--------+--------+--------+--------+--------+---------------+
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Amphion Innovations plc | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Condensed | | | | | | | | |
| consolidated | | | | | | | | |
| statement of changes | | | | | | | | |
| in equity | | | | | | | | |
+--------------------------------------------------------------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| For the six months ended 30 June 2009 | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Unaudited | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | | | Foreign | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | Share | | currency | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | Share | | premium | | translation | | Retained | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | Notes | capital | | account | | reserve | | earnings | | Total |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | US$ | | US$ | | US$ | | US$ | | US$ |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Balance at 31 December 2007 | | 2,388,071 | | 34,772,046 | | 2,860 | | 19,667,933 | | 56,830,910 |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Profit for the period | | - | | - | | - | | 10,022,764 | | 10,022,764 |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Exchange differences arising on | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| translation of foreign operations | | - | | - | | (953) | | - | | (953) |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Total comprehensive income for the period | | - | | - | | (953) | | 10,022,764 | | 10,021,811 |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Issue of share capital | | 37,871 | | 792,844 | | - | | - | | 830,715 |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Incremental costs directly attributable | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| to issue of shares | | - | | (34,458) | | - | | - | | (34,458) |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Recognition of share-based payments | | - | | 354,869 | | - | | - | | 354,869 |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Balance at 30 June 2008 | | 2,425,942 | | 35,885,301 | | 1,907 | | 29,690,697 | | 68,003,847 |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Loss for the period | | - | | - | | - | | (11,227,299) | | (11,227,299) |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Exchange differences arising on | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| translation of foreign operations | | - | | - | | (40,295) | | - | | (40,295) |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Total comprehensive income for the period | | - | | - | | (40,295) | | (11,227,299) | | (11,267,594) |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Issue of share capital | | 3,400 | | 66,600 | | - | | - | | 70,000 |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Incremental costs directly attributable | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| to issue of shares | | - | | (6,965) | | - | | - | | (6,965) |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Recognition of share-based payments | | - | | 346,326 | | - | | - | | 346,326 |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Balance at 31 December 2008 | | 2,429,342 | | 36,291,262 | | (38,388) | | 18,463,398 | | 57,145,614 |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Loss for the period | | - | | - | | - | | (194,332) | | (194,332) |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Exchange differences arising on | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| translation of foreign operations | | - | | - | | 39,955 | | - | | 39,955 |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Total comprehensive income for the period | | - | | - | | 39,955 | | (194,332) | | (154,377) |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Issue of share capital | 9 | 18,961 | | 185,361 | | - | | - | | 204,322 |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Recognition of share-based payments | 11 | - | | 327,064 | | - | | - | | 327,064 |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| | | | | | | | | | | |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
| Balance at 30 June 2009 | | 2,448,303 | | 36,803,687 | | 1,567 | | 18,269,066 | | 57,522,623 |
+-------------------------------------------+-------+----------------+-------+-------------------+-------+-----------------+-------+--------------------+-------+-------------------+
Amphion Innovations plc
Condensed consolidated statement of cash flows
For the six months ended 30 June 2009
Unaudited
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| | Six months | | Six months | | Year ended |
| | ended | | ended | | 31 December 2008 |
| | 30 June 2009 | | 30 June 2008 | | |
+------------------------------------------------------------+ +-----------------+ +---+ +
| | | | | | |
+------------------------------------------------------------+ +-----------------+ +---+ +
| | | | | | |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| | US$ | | US $ | | US $ |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| | | | | | |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Operating activities | | | | | |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| | | | | | |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Operating loss | (22,304) | | (1,734,367) | | (3,381,098) |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| | | | | | |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Adjustments for: | | | | | |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Depreciation of property, plant and equipment | 5,288 | | 6,408 | | 11,836 |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Amortisation of intangible assets | 129,914 | | 123,428 | | 253,935 |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Recognition of share based payments | 531,386 | | 354,869 | | 1,103,235 |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Decrease (increase) in prepaid & other receivables | (783,057) | | 21,753 | | (927,482) |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Increase in trade & other payables | 281,783 | | 395,625 | | 623,776 |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Interest expense | (148,198) | | (1,787) | | (29,878) |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Income tax | (87,000) | | (165,792) | | (13,130) |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| | | | | | |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Net cash used in operating activities | (92,188) | | (999,863) | | (2,358,806) |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| | | | | | |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Investing activities | | | | | |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| | | | | | |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Interest received | 188,959 | | 135,457 | | 274,788 |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Proceeds from repayment of notes receivable | 160,000 | | 495,890 | | 495,890 |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Purchases of investments | (1,479,849) | | (3,014,877) | | (5,915,881) |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Purchases of intangible assets | | | (118,000) | | (129,714) |
| | - | | | | |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Purchases of equipment | (4,967) | | (5,072) | | (4,173) |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| | | | | | |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Net cash used in investing activities | (1,135,857) | | (2,506,602) | | (5,279,090) |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| | | | | | |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Financing activities | | | | | |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| | | | | | |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Proceeds on issue of shares, net of share issuance costs | | | 796,257 | | 457,252 |
| | - | | | | |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Proceeds on issue of promissory notes | 902,324 | | - | | 3,279,950 |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| | | | | | |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Net cash from financing activities | 902,324 | | 796,257 | | 3,737,202 |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| | | | | | |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Net decrease in cash and cash equivalents | (325,721) | | (2,710,208) | | (3,900,694) |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| | | | | | |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Cash and cash equivalents at the beginning of the period | 630,404 | | 4,594,007 | | 4,594,007 |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| | | | | | |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Effect of foreign exchange rate changes | 60,451 | | (11,911) | | (62,909) |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| | | | | | |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
| Cash and cash equivalents at the end of the period | 365,134 | | 1,871,888 | | 630,404 |
+------------------------------------------------------------+-------------------+-----------------+-------------------+---+---------------------------+
1. General information
The condensed consolidated interim financial statements for the six months ended
30 June 2009 are unaudited and do not constitute statutory accounts within the
meaning of the Isle of Man Companies Acts 1931 to 2004. The statutory accounts
of Amphion Innovations plc for the year ended 31 December 2008 have been filed
with the Registrar of Companies and contain an unqualified audit report which
includes an emphasis of matter reference for going concern and valuation of
investments. Copies are available on the company's website at
www.amphionplc.com/reports.php.
2. Accounting policies
These condensed consolidated interim financial statements have been prepared in
accordance with the recognition and measurement requirements of International
Financial Reporting Standards (IFRS).
The accounting policies applied by the Group are consistent with those followed
in the preparation of the Group's annual financial statements for the year ended
31 December 2008 except for the impact of the adoption of the Standards and
Interpretations described below.
IFRS 8 Operating Segments (effective for annual periods beginning on or after 1
January 2009)
IFRS 8 is a disclosure Standard that has had no impact on the Group's reportable
segments or on the reported results or financial position of the Group.
IAS 1 (revised 2007) Presentation of Financial Statements (effective for annual
periods beginning on or after 1 January 2009)
The revised Standard has introduced a number of terminology changes (including
revised titles for the condensed financial statements) and has resulted in a
number of changes in presentation and disclosure. However, the revised Standard
has had no impact on the reported results or financial position of the Group.
3. Revenue
An analysis of the Group's revenue is as follows:
+-----------------------+--------------------------+-------------+---------------------------+-------------+-------------------------+
| | Six months ended | | Six months ended | | Year ended |
+-----------------------+--------------------------+-------------+---------------------------+-------------+-------------------------+
| | 30 June 2009 | | 30 June 2008 | | 31 December 2008 |
+-----------------------+--------------------------+-------------+---------------------------+-------------+-------------------------+
| | US $ | | US$ | | US$ |
+-----------------------+--------------------------+-------------+---------------------------+-------------+-------------------------+
| | | | | | |
+-----------------------+--------------------------+-------------+---------------------------+-------------+-------------------------+
| Continuing operations | | | | | |
+-----------------------+--------------------------+-------------+---------------------------+-------------+-------------------------+
| Advisory fees | 553,453 | | 1,135,966 | | 1,637,694 |
+-----------------------+--------------------------+-------------+---------------------------+-------------+-------------------------+
| License fees | 3,457,050 | | 4,250,000 | | 5,450,250 |
+-----------------------+--------------------------+-------------+---------------------------+-------------+-------------------------+
| | | | | | |
+-----------------------+--------------------------+-------------+---------------------------+-------------+-------------------------+
| | 4,010,503 | | 5,385,966 | | 7,087,944 |
+-----------------------+--------------------------+-------------+---------------------------+-------------+-------------------------+
DataTern Inc., a wholly owned subsidiary of the Company, has entered into an
agreement with IP Navigation Group, LLC which provides strategic advisory
services including licensing and enforcement of various patents held by
DataTern, Inc.Under this agreement, IP Navigation Group, LLC will advance up to
US $2,000,000 to DataTern, Inc. under a promissory note to pay the expenses
related to the licensing and enforcement of the patents. The promissory note
has an 8% interest rate with repayment coming exclusively from the proceeds of
the licensing and enforcement program.The note is due 18 February 2013 and is
secured by the assets of DataTern, Inc. The promissory note had a balance of US
$86,109 outstanding at 30 June 2009.
During 2009, IP Navigation Group, LLC assisted in obtaining non-exclusive
licenses of DataTern's key database patents to various companies totaling US
$3,450,000. As part of the agreement, IP Navigation Group, LLC received advisory
fees of fifty percent of the gross proceeds less the repayment of expenses
funded by IP
3. Revenue, (continued)
Navigation Group, LLC and related interest which amounted to US $617,159, and
expenses of third parties. The advisory fees payable to IP Navigation Group,
LLC totaled US $1,398,420.
As part of the agreement for DataTern, Inc. to purchase certain of the
intangible assets in December 2007, a portion of future revenues from these
patents will be retained by FireStar Software, Inc. No amounts have become
payable to FireStar Software, Inc. to date.
4. Segment information
The Group has adopted IFRS 8 Operating Segments with effect from 1 January 2009.
IFRS 8 requires operating segments to be identified on the basis of internal
reports about components of the Group that are regularly reviewed by the chief
operating decision maker in order to allocate resources to the segment and to
assess its performance. In contrast, the predecessor Standard (IAS 14 Segment
Reporting) required an entity to identify two sets of segments (business and
geographical), using a risks and rewards approach, with the entity's system of
internal financial reporting to key management personnel serving only as the
starting point for the identification of such segments. There has been no change
to the identification of the Group's reportable segments as a result of the
adoption of IFRS 8.
For management purposes, the Group is currently organised into three business
segments - advisory services, investing, and intellectual property. These
business segments are the basis on which the Group reports its primary segment
information.
Information regarding these segments is presented below.
+--------+-------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| | | | Advisory | | Investing | | Intellectual | | | | |
+--------+-------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| | | | services | | activities | | property | | Eliminations | | Consolidated |
+--------+-------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| | | | Six months | | Six months | | Six months | | Six months | | Six months |
+--------+-------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| | | | ended | | ended | | ended | | ended | | ended |
+--------+-------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| | | | 30 June 2009 | | 30 June 2009 | | 30 June 2009 | | 30 June 2009 | | 30 June 2009 |
+--------+-------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| | | | US $ | | US $ | | US $ | | US $ | | US $ |
+--------+-------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| REVENUE | | | | | | | | | | |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| External | | 553,453 | | - | | - | | - | | 553,453 |
| advisory fees | | | | | | | | | | |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| External | | - | | - | | 3,457,050 | | - | | 3,457,050 |
| license fees | | | | | | | | | | |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| Inter-segment | | 120,000 | | - | | - | | (120,000) | | - |
| fees | | | | | | | | | | |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| Total | | 673,453 | | - | | 3,457,050 | | (120,000) | | 4,010,503 |
| revenue | | | | | | | | | | |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| Cost of sales | | - | | - | | (1,398,420) | | - | | (1,398,420) |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| Gross profit | | 673,453 | | - | | 2,058,630 | | (120,000) | | 2,612,083 |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| Administrative | | (505,542) | | (1,433,756) | | (815,089) | | 120,000 | | (2,634,387) |
| expenses | | | | | | | | | | |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| | | | | | | | | | | | |
+--------+-------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| Segment | | 167,911 | | (1,433,756) | | 1,243,541 | | - | | (22,304) |
| result | | | | | | | | | | |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| | | | | | | | | | | | |
+--------+-------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| Fair value losses on | | | | | | | | |
+--------------------------------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| | | - | | (146,832) | | - | | - | | (146,832) |
| investments | | | | | | | | | | |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| Interest | | 1 | | 192,700 | | 27 | | (3,769) | | 188,959 |
| income | | | | | | | | | | |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| Other gains | | - | | 21,043 | | - | | - | | 21,043 |
| and losses | | | | | | | | | | |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| Finance costs | | - | | (137,769) | | (14,198) | | 3,769 | | (148,198) |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| Profit (loss) | | 167,912 | | (1,504,614) | | 1,229,370 | | - | | (107,332) |
| before tax | | | | | | | | | | |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| Income taxes | | - | | - | | (87,000) | | - | | (87,000) |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| | | | | | | | | | | | |
+--------+-------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
| Profit (loss) | | 167,912 | | (1,504,614) | | 1,142,370 | | - | | (194,332) |
| after tax | | | | | | | | | | |
+--------+-------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+
4. Segment information, (continued)
+-------+-------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| | | | Advisory | | Investing | | Intellectual | | | | |
+-------+-------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| | | | services | | activities | | property | | Eliminations | | Consolidated |
+-------+-------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| | | | Six months | | Six months | | Six months | | Six months | | Six months |
+-------+-------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| | | | ended | | ended | | ended | | ended | | ended |
+-------+-------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| | | | 30 June 2009 | | 30 June 2009 | | 30 June 2009 | | 30 June 2009 | | 30 June 2009 |
+-------+-------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| | | | US $ | | US $ | | US $ | | US $ | | US $ |
+-------+-------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| | | | | | | | | | | | |
+-------+-------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| OTHER | | | | | | | | | | |
| INFORMATION | | | | | | | | | | |
+---------------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| Segment | | 1,490,762 | | 61,953,337 | | 2,884,973 | | (1,248,874) | | 65,080,198 |
| assets | | | | | | | | | | |
+---------------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| | | | | | | | | | | | |
+-------+-------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| Segment | | 931,814 | | 889,635 | | 2,397,470 | | (843,618) | | 3,375,301 |
| liabilities | | | | | | | | | | |
+---------------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| | | | | | | | | | | | |
+-------+-------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| Capital | | 3,081 | | - | | 1,886 | | - | | 4,967 |
| additions | | | | | | | | | | |
+---------------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| Depreciation | | 2,928 | | 2,003 | | 357 | | - | | 5,288 |
+---------------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| Amortisation | - | | - | | 129,914 | | - | | 129,914 |
+-----------------------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| Recognition of share | | | | | | | | | |
| based | | | | | | | | | |
+-----------------------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| payments | | - | | 531,386 | | - | | - | | 531,386 |
+-------+-------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
4. Segment information, (continued)
For management purposes for 30 June 2008, the Group was organised into three
business segments - advisory services, investing activities, and intellectual
property.
+--------+-------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| | | | Advisory | | Investing | | Intellectual | | | | |
+--------+-------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| | | | services | | activities | | property | | Eliminations | | Consolidated |
+--------+-------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| | | | Six months | | Six months | | Six months | | Six months | | Six months |
+--------+-------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| | | | ended | | ended | | ended | | ended | | ended |
+--------+-------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| | | | 30 June 2008 | | 30 June 2008 | | 30 June 2008 | | 30 June 2008 | | 30 June 2008 |
+--------+-------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| | | | US $ | | US $ | | US $ | | US $ | | US $ |
+--------+-------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| REVENUE | | | | | | | | | | |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| External | | 1,255,966 | | - | | - | | (120,000) | | 1,135,966 |
| advisory fees | | | | | | | | | | |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| External | | - | | - | | 4,250,000 | | - | | 4,250,000 |
| license fees | | | | | | | | | | |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| Inter-segment | | - | | 393,432 | | - | | (393,432) | | - |
| fees | | | | | | | | | | |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| Total | | 1,255,966 | | 393,432 | | 4,250,000 | | (513,432) | | 5,385,966 |
| revenue | | | | | | | | | | |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| Cost of sales | | - | | - | | (3,237,562) | | - | | (3,237,562) |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| Gross profit | | 1,255,966 | | 393,432 | | 1,012,438 | | (513,432) | | 2,148,404 |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| Administrative | | (896,386) | | (2,147,241) | | (1,352,576) | | 513,432 | | (3,882,771) |
| expenses | | | | | | | | | | |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| | | | | | | | | | | | |
+--------+-------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| Segment | | 359,580 | | (1,753,809) | | (340,138) | | - | | (1,734,367) |
| result | | | | | | | | | | |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| | | | | | | | | | | | |
+--------+-------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| Fair value and gains on | | | | | | | | |
+--------------------------------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| | | - | | 11,800,211 | | - | | - | | 11,800,211 |
| investments | | | | | | | | | | |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| Interest | | 80 | | 158,421 | | 321 | | (23,365) | | 135,457 |
| income | | | | | | | | | | |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| Other gains | | - | | (10,958) | | - | | - | | (10,958) |
| and losses | | | | | | | | | | |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| Finance costs | | - | | - | | (25,152) | | 23,365 | | (1,787) |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| Profit before | | 359,660 | | 10,193,865 | | (364,969) | | - | | 10,188,556 |
| tax | | | | | | | | | | |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| Income taxes | | (146,000) | | (19,792) | | - | | - | | (165,792) |
+----------------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| | | | | | | | | | | | |
+--------+-------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
| Profit after | | 213,660 | | 10,174,073 | | (364,969) | | - | | 10,022,764 |
| tax | | | | | | | | | | |
+--------+-------+-------+-------------------------+-------+-------------------------+-------+-------------------------+-------+--------------------------+-------+-------------------------+
+-------+-------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| | | | Advisory | | Investing | | Intellectual | | | | |
+-------+-------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| | | | services | | activities | | property | | Eliminations | | Consolidated |
+-------+-------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| | | | Six months | | Six months | | Six months | | Six months | | Six months |
+-------+-------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| | | | ended | | ended | | ended | | ended | | ended |
+-------+-------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| | | | 30 June 2008 | | 30 June 2008 | | 30 June 2008 | | 30 June 2008 | | 30 June 2008 |
+-------+-------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| | | | US $ | | US $ | | US $ | | US $ | | US $ |
+-------+-------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| | | | | | | | | | | | |
+-------+-------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| OTHER | | | | | | | | | | |
| INFORMATION | | | | | | | | | | |
+---------------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| Segment | | 1,443,505 | | 68,425,848 | | 3,157,841 | | (2,157,980) | | 70,869,214 |
| assets | | | | | | | | | | |
+---------------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| | | | | | | | | | | | |
+-------+-------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| Segment | | 522,653 | | 640,413 | | 3,431,306 | | (1,729,005) | | 2,865,367 |
| liabilities | | | | | | | | | | |
+---------------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| | | | | | | | | | | | |
+-------+-------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| Capital | | - | | 3,386 | | 119,686 | | - | | 123,072 |
| additions | | | | | | | | | | |
+---------------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| Depreciation | | 2,928 | | 3,480 | | - | | - | | 6,408 |
+---------------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| Amortisation | - | | - | | 123,428 | | - | | 123,428 |
+-----------------------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| Recognition of share | | | | | | | | | |
| based | | | | | | | | | |
+-----------------------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
| payments | | - | | 354,869 | | - | | - | | 354,869 |
+-------+-------+-------+-------------------------+-------+------------------------+-------+-------------------------+-------+-------------------------+-------+----------------------+
4. Segment information, (continued)
Geographical segments
The Group's operations are located in the United States and the United Kingdom.
The following table provides an analysis of the Group's advisory fees by
geographical location of the investment.
+----------+----------+----------+----------+------------+
| | | Advisory fees by |
+----------+----------+----------------------------------+
| | | geographical location |
+----------+----------+----------------------------------+
| | | Six | | Six |
| | | months | | months |
| | | ended | | ended |
+----------+----------+----------+----------+------------+
| | | 30 June | | 30 June |
| | | 2009 | | 2008 |
+----------+----------+----------+----------+------------+
| | | US $ | | US $ |
+----------+----------+----------+----------+------------+
| | | | | |
+----------+----------+----------+----------+------------+
| United | | 390,000 | | |
| States | | | | 714,450 |
+----------+----------+----------+----------+------------+
| United | | 163,453 | | |
| Kingdom | | | | 421,516 |
+----------+----------+----------+----------+------------+
| | | 553,453 | | |
| | | | | 1,135,966 |
+----------+----------+----------+----------+------------+
The following table provides an analysis of the Group's license fees by
geographical location.
+----------+--------------+--------------+
| | License fees by |
+----------+-----------------------------+
| | geographical |
| | location |
+----------+-----------------------------+
| | Six | Six |
| | months | months |
| | ended | ended |
+----------+--------------+--------------+
| | 30 June | 30 June |
| | 2008 | 2008 |
+----------+--------------+--------------+
| | US$ | US$ |
+----------+--------------+--------------+
| United | 3,457,050 | 4,250,000 |
| States | | |
+----------+--------------+--------------+
| United | - | - |
| Kingdom | | |
+----------+--------------+--------------+
| | 3,457,050 | 4,250,000 |
+----------+--------------+--------------+
The following is an analysis of the carrying amount of segment assets, and
additions to fixtures, fittings and equipment, analysed by the geographical area
in which the assets are located:
+--------------+----------------+--+----------------+--+----------------+--+----------------+
| | Carrying amount | | Additions to fixtures, fittings |
| | | | and |
+--------------+------------------------------------+--+------------------------------------+
| | of segment assets | | equipment and intangible assets |
+--------------+------------------------------------+--+------------------------------------+
| | Six months | | Six months | | Six months | | Six months |
| | ended | | ended | | ended | | ended |
+--------------+----------------+--+----------------+--+----------------+--+----------------+
| | 30 June 2009 | | 30 June 2008 | | 30 June 2009 | | 30 June 2008 |
+--------------+----------------+--+----------------+--+----------------+--+----------------+
| | US $ | | US $ | | US $ | | US $ |
+--------------+----------------+--+----------------+--+----------------+--+----------------+
| | | | | | | | |
+--------------+----------------+--+----------------+--+----------------+--+----------------+
| United | 46,624,077 | | 45,464,104 | | 4,967 | | 119,686 |
| States | | | | | | | |
+--------------+----------------+--+----------------+--+----------------+--+----------------+
| United | 18,456,121 | | 25,405,110 | | - | | 3,386 |
| Kingdom | | | | | | | |
+--------------+----------------+--+----------------+--+----------------+--+----------------+
| | 65,080,198 | | 70,869,214 | | 4,967 | | 123,072 |
+--------------+----------------+--+----------------+--+----------------+--+----------------+
5. Income tax expense
+---------------------------------------------------------------------+-------------+----------+-------------+
| Six months Six months Year ended | | | |
| ended ended | | | |
| 30 June 2009 30 June 2008 31 December | | | |
| 2008 | | | |
| US $ US $ US $ | | | |
| Isle of - - - | | | |
| Man | | | |
| income | | | |
| tax | | | |
| Tax on 87,000 146,000 3,696 | | | |
| US | | | |
| subsidiary | | | |
| Tax on - 19,792 9,434 | | | |
| UK | | | |
| subsidiary | | | |
| | | | |
| Current 87,000 165,792 13,130 | | | |
| tax | | | |
| | | | |
+---------------------------------------------------------------------+-------------+----------+-------------+
| | | | |
+---------------------------------------------------------------------+-------------+----------+-------------+
From 6 April 2006, a standard rate of corporate income tax of 0% applies to Isle
of Man companies, with exceptions taxable at the 10% rate, namely licensed banks
in respect of deposit-taking business, companies that profit from land and
property in the Isle of Man and companies that elect to pay tax at the 10% rate.
No provision for Isle of Man taxation is therefore required. The Company is
treated as a Partnership for U.S. federal and state income tax purposes and,
accordingly, its income or loss is taxable directly to its partners.
The Company has three subsidiaries, two in the USA and one in the UK. The US
subsidiaries, Amphion Innovations US Inc. and DataTern, Inc., are Corporations
and therefore taxed directly. The US subsidiaries suffer US federal tax, state
tax and New York City tax on their taxable net income. The UK subsidiary,
Amphion Innovations UK Limited, is liable to UK Corporation tax at rates up to
30% on its taxable profits and gains.
The Group charge for the period can be reconciled to the profit per the
consolidated income statement as follows:
+------------------------------------------+-----------+
| | US $ |
+------------------------------------------+-----------+
| | |
+------------------------------------------+-----------+
| Loss before tax | |
| | (107,332) |
+------------------------------------------+-----------+
| | |
+------------------------------------------+-----------+
| Tax at the Isle of Man income tax rate | - |
| of 0% | |
+------------------------------------------+-----------+
| | |
+------------------------------------------+-----------+
| Effect of different tax rates of | |
| subsidiaries | |
+------------------------------------------+-----------+
| operating in other jurisdictions | 87,000 |
+------------------------------------------+-----------+
| | |
+------------------------------------------+-----------+
| Current tax | 87,000 |
+------------------------------------------+-----------+
6. Earnings per share
The calculation of the basic and diluted earnings per share attributable to the
ordinary equity holders of the parent is based on the following data:
+------------------------------------------------------------+--+----------------------------------+----------+-------------------------------+--+--------------------------+
| Earnings | | Six months ended | | Six months ended | | Year ended |
+------------------------------------------------------------+--+----------------------------------+----------+-------------------------------+--+--------------------------+
| | | 30 June 2009 | | 30 June 2008 | | 31 December 2008 |
+------------------------------------------------------------+--+----------------------------------+----------+-------------------------------+--+--------------------------+
| | | US $ | | US $ | | US $ |
+------------------------------------------------------------+--+----------------------------------+----------+-------------------------------+--+--------------------------+
| Earnings for the purposes of basic and diluted earnings | | | | | | |
| per share | | | | | | |
+------------------------------------------------------------+--+----------------------------------+----------+-------------------------------+--+--------------------------+
| (profit for the year attributable to equity holders of | | (194,332) | | 10,022,764 | | (1,204,535) |
| the parent) | | | | | | |
+------------------------------------------------------------+--+----------------------------------+----------+-------------------------------+--+--------------------------+
| | | | | | | |
+------------------------------------------------------------+--+----------------------------------+----------+-------------------------------+--+--------------------------+
| | | | | | | |
+------------------------------------------------------------+--+----------------------------------+----------+-------------------------------+--+--------------------------+
| Number of shares | | | | | | |
+------------------------------------------------------------+--+----------------------------------+----------+-------------------------------+--+--------------------------+
| | | Six months | | Six months | | |
+------------------------------------------------------------+--+----------------------------------+----------+-------------------------------+--+--------------------------+
| | | ended | | ended | | Year ended |
+------------------------------------------------------------+--+----------------------------------+----------+-------------------------------+--+--------------------------+
| | | 30 June 2009 | | 30 June 2008 | | 31 December 2008 |
+------------------------------------------------------------+--+----------------------------------+----------+-------------------------------+--+--------------------------+
| | | | | | | |
+------------------------------------------------------------+--+----------------------------------+----------+-------------------------------+--+--------------------------+
| Weighted average number of ordinary shares for | | | | | | |
+------------------------------------------------------------+--+----------------------------------+----------+-------------------------------+--+--------------------------+
| the purposes of basic earnings per share | | 130,963,672 | | 129,349,031 | | 130,183,495 |
+------------------------------------------------------------+--+----------------------------------+----------+-------------------------------+--+--------------------------+
| | | | | | | |
+------------------------------------------------------------+--+----------------------------------+----------+-------------------------------+--+--------------------------+
| Effect of dilutive potential ordinary shares: | | | | | | |
+------------------------------------------------------------+--+----------------------------------+----------+-------------------------------+--+--------------------------+
| Share options | | 236,895 | | 61,312 | | |
| | | | | | | - |
+------------------------------------------------------------+--+----------------------------------+----------+-------------------------------+--+--------------------------+
| Convertible promissory notes | | 15,598,744 | | | | 12,171,667 |
| | | | | - | | |
+------------------------------------------------------------+--+----------------------------------+----------+-------------------------------+--+--------------------------+
| | | | | | | |
+------------------------------------------------------------+--+----------------------------------+----------+-------------------------------+--+--------------------------+
| Weighted average number of ordinary shares for | | | | | | |
+------------------------------------------------------------+--+----------------------------------+----------+-------------------------------+--+--------------------------+
| the purposes of diluted earnings per share | | 146,799,311 | | 129,410,343 | | 142,355,162 |
+------------------------------------------------------------+--+----------------------------------+----------+-------------------------------+--+--------------------------+
7. Investments
At fair value through profit or loss
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| | | 30 June 2009 | | 31 December 2008 |
+----------------------------------+--+--------------------------------------------------------------------------+--+-----------------------------------------------------------------+
| | | | | | | Unrealised | | | | | | Unrealised |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| | | Fair Value | | Cost | | gain/(loss) | | Fair Value | | Cost | | gain/(loss) |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| | | US $ | | US $ | | US $ | | US $ | | US $ | | US $ |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| | | | | | | | | | | | | |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| Public companies: | | | | | | | | | | | | |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| Axcess International, Inc. | | 2,010,460 | | 3,447,794 | | (1,437,334) | | 1,612,931 | | 3,447,794 | | (1,834,863) |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| | | | | | | | | | | | | |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| Private companies: | | | | | | | | | | | | |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| FireStar Software, Inc. | | 4,543,533 | | 4,751,783 | | (208,250) | | 4,721,447 | | 4,941,783 | | (220,336) |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| Kromek Ltd. | | 16,172,316 | | 3,274,915 | | 12,897,401 | | 14,370,477 | | 3,274,915 | | 11,095,562 |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| Motif BioSciences, Inc. | | 15,729,930 | | 8,417,625 | | 7,312,305 | | 15,402,879 | | 8,085,625 | | 7,317,254 |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| MSA Holding B.S.C. | | 1,474,905 | | 1,500,000 | | (25,095) | | 1,474,905 | | 1,500,000 | | (25,095) |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| m2m Imaging Corp. | | 6,860,550 | | 2,468,685 | | 4,391,865 | | 6,642,861 | | 2,172,453 | | 4,470,408 |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| Myconostica Ltd. | | 2,253,930 | | 2,745,331 | | (491,401) | | 4,216,206 | | 2,745,331 | | 1,470,875 |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| PrivateMarkets, Inc. | | 4,556,522 | | 3,311,522 | | 1,245,000 | | 3,918,673 | | 2,673,673 | | 1,245,000 |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| WellGen, Inc. | | 6,600,803 | | 4,814,936 | | 1,785,867 | | 6,669,553 | | 4,814,936 | | 1,854,617 |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| | | | | | | | | | | | | |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| | | 60,202,949 | | 34,732,591 | | 25,470,358 | | 59,029,932 | | 33,656,510 | | 25,373,422 |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| | | | | | | | | | | | | |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| | | | | |
+----------------------------------+--+--------------------------------------------------------------------------+--+-----------------------------------------------------------------+
| | | 30 June 2009 | | 31 December 2008 |
+----------------------------------+--+--------------------------------------------------------------------------+--+-----------------------------------------------------------------+
| | | | | | | Unrealised | | | | | | Unrealised |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| | | Fair Value | | Cost | | gain/(loss) | | Fair Value | | Cost | | gain/(loss) |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| | | US $ | | US $ | | US $ | | US $ | | US $ | | US $ |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| | | | | | | | | | | | | |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| Stocks | | 44,036,543 | | 22,969,181 | | 21,067,362 | | 43,540,862 | | 22,969,181 | | 20,571,681 |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| Promissory notes | | 8,100,451 | | 8,100,451 | | - | | 6,780,602 | | 6,780,602 | | - |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| Warrants & options | | 8,065,955 | | 3,662,959 | | 4,402,996 | | 8,708,468 | | 3,906,727 | | 4,801,741 |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| | | | | | | | | | | | | |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
| | | 60,202,949 | | 34,732,591 | | 25,470,358 | | 59,029,932 | | 33,656,510 | | 25,373,422 |
+----------------------------------+--+-------------------+----+---------------+----+----------------------------+--+----------------+----+---------------+----+----------------------+
7. Investments, (continued)
At 30 June 2009 the one publicly traded company, Axcess International, Inc.
("Axcess") is valued based on its last quoted closing price. In regard to the
Group's valuation of Axcess, the Directors have assumed an orderly sale of the
stock over an extended period of time and have therefore chosen not to apply a
discount to the quoted market price.Equity investments in Kromek, FireStar
Software, Inc., Motif BioSciences Inc., m2m Imaging Corp, PrivateMarkets,
Inc. and WellGen, Inc. are valued using the latest offering price from recently
executed financing transactions by those companies.Equity investments in
Myconostica Ltd. are valued using the proposed offering price for a financing
transaction that is expected to close later in 2009. Convertible promissory
notes held in these companies are valued at cost. The value of MSA Holding
B.S.C. is based on the value of its net assets at 30 June 2009. Warrants for
all companies are valued at the valuation price less the warrant exercise price
plus a factor for the time value of the warrant. The time value factor is based
on the premise that an in-the-money ten year warrant is worth half the exercise
price.
The 30 June 2009 fair value losses on investments include an unrealized gain of
US $96,936 and a realized loss of US $243,768.
At 30 June 2009, MSA Holding B.S.C. owned 2,626,467 of the ordinary shares of
Amphion Innovations plc.
The Group's ownership percentages of the investments are as follows:
+--------------------------+----------+--------------------+----------+---------------+
| | | | | Fully-diluted |
+--------------------------+----------+--------------------+----------+---------------+
| | | | | ownership |
+--------------------------+----------+--------------------+----------+---------------+
| | | Country of | | % |
| | | incorporation | | |
+--------------------------+----------+--------------------+----------+---------------+
| | | | | |
+--------------------------+----------+--------------------+----------+---------------+
| Axcess International, | | United States of | | 8.50 |
| Inc. | | America | | |
+--------------------------+----------+--------------------+----------+---------------+
| FireStar Software, Inc. | | United States of | | 15.32 |
| | | America | | |
+--------------------------+----------+--------------------+----------+---------------+
| Kromek | | England & Wales | | 19.99 |
+--------------------------+----------+--------------------+----------+---------------+
| Motif BioSciences, Inc. | | United States of | | 38.55 |
| | | America | | |
+--------------------------+----------+--------------------+----------+---------------+
| MSA Holding B.S.C. | | Kingdom of Bahrain | | 50.00 |
+--------------------------+----------+--------------------+----------+---------------+
| m2m Imaging Corp. | | United States of | | 24.40 |
| | | America | | |
+--------------------------+----------+--------------------+----------+---------------+
| Myconostica Ltd. | | England & Wales | | 22.14 |
+--------------------------+----------+--------------------+----------+---------------+
| PrivateMarkets, Inc. | | United States of | | 25.34 |
| | | America | | |
+--------------------------+----------+--------------------+----------+---------------+
| WellGen, Inc. | | United States of | | 14.56 |
| | | America | | |
+--------------------------+----------+--------------------+----------+---------------+
8.Convertible promissory notes
During 2009, GBP616,874 of convertible promissory notes were issued of which
GBP24,624 were subscribed for by three Directors of the Company. The notes are
convertible into ordinary shares of the Company at any time prior to 31 December
2013 at a conversion price of eighteen pence per ordinary share. In the event
that the closing market price of the ordinary shares is equal to or greater than
25 pence per ordinary share for 25 consecutive trading dates at any time prior
to 31 December 2013, the notes will automatically be converted into fully paid
ordinary shares.
If the notes have not been converted, they will be repaid on 31 December 2013.
Interest of 7% will be paid quarterly until the date of repayment.
For each note issued, the Company also issued 1.11 warrants. Each warrant will
entitle the holder to subscribe for one ordinary share at 20 pence per ordinary
share.
The net proceeds received from the issue of the convertible promissory notes are
classified as a financial liability due to the fact that the notes are
denominated in a currency other than the Company's functional currency.
9.Share capital
+-------------+--------------+----------+------------+----------+-------------+
| | 30 June | | | | |
| | 2009 | | | | |
+-------------+--------------+----------+------------+----------+-------------+
| | GBP | | | | |
+-------------+--------------+----------+------------+----------+-------------+
| Authorised: | | | | | |
+-------------+--------------+----------+------------+----------+-------------+
| | 2,500,000 | | | | |
| 250,000,000 | | | | | |
| ordinary | | | | | |
| shares of | | | | | |
| 1p each | | | | | |
+-------------+--------------+----------+------------+----------+-------------+
| | | | | | |
+-------------+--------------+----------+------------+----------+-------------+
| | | | | | |
+-------------+--------------+----------+------------+----------+-------------+
| | Number | | GBP | | US$ |
+-------------+--------------+----------+------------+----------+-------------+
| | | | | | |
+-------------+--------------+----------+------------+----------+-------------+
| Balance | 130,378,857 | | | | |
| as at 31 | | | 1,303,789 | | 2,429,342 |
| December | | | | | |
| 2008 | | | | | |
+-------------+--------------+----------+------------+----------+-------------+
| | | | | | |
+-------------+--------------+----------+------------+----------+-------------+
| Issued and fully | | | | |
| paid: | | | | |
+----------------------------+----------+------------+----------+-------------+
| | | | 8,750 | | |
| Ordinary | 874,977 | | | | 12,874 |
| shares | | | | | |
| of 1 p | | | | | |
| each | | | | | |
+-------------+--------------+----------+------------+----------+-------------+
| | | | 2,210 | | 3,142 |
| Ordinary | 221,037 | | | | |
| shares | | | | | |
| of 1p | | | | | |
| each | | | | | |
+-------------+--------------+----------+------------+----------+-------------+
| Ordinary | 207,189 | | 2,072 | | 2,945 |
| shares | | | | | |
| of 1p | | | | | |
| each | | | | | |
+-------------+--------------+----------+------------+----------+-------------+
| | | | | | |
+-------------+--------------+----------+------------+----------+-------------+
| Balance | | | | | 2,448,303 |
| as at 30 | 131,682,060 | | 1,316,821 | | |
| June | | | | | |
| 2009 | | | | | |
+-------------+--------------+----------+------------+----------+-------------+
During the six months ended 30 June 2009, the following changes occurred to the
share capital of the Company:
On 30 March 2009, the Company issued 874,977 ordinary 1p shares at a premium of
9.75p per share (US $125,526) to employees as part of their incentive
compensation.
On 15 April 2009, the Company issued 221,037 ordinary 1p shares at a premium of
10.14p per share (US $31,858) to Directors in lieu of first quarter Directors'
fees.
On 26 May 2009, the Company issued 207,189 ordinary 1p shares at a premium of
9.5p per share (US $27,977) to certain holders of the Convertible Promissory
Notes in respect of accrued interest on the Notes.
10. Contingent liabilities
The Compensation Committee has determined the bonuses for the year 2008 and
required that 50% of the bonuses be paid in shares. The cash portion totaling US
$153,600 is only to be paid at the discretion of the Compensation Committee
therefore no provision has been made in these financial statements for the cash
portion.
The Company is subject to two lawsuits brought by former employees. The Company
believes the lawsuits are without merit and that any settlements will not exceed
US $200,000 in total plus legal costs. No provision has been made in these
financial statements for the settlements.
11. Share based payments
In 2006 the Group established the 2006 Unapproved Share Option Plan ("the Plan")
and it was adopted pursuant to a resolution passed on 8 June 2006. Under this
plan, the Compensation Committee may grant share options to eligible employees,
including Directors, to subscribe for ordinary shares of the Company. The number
of Shares over which options may be granted under the Unapproved Plan cannot
exceed ten percent of the ordinary share capital of the Company in issue on a
fully diluted basis.The Plan will be administered by the Compensation Committee.
The number of shares, terms, performance targets and exercise period will be
determined by the Compensation Committee.
During 2009, 1,925,000 options have been issued under the Plan and 525,000
options were forfeited.
The options issued expire after ten years from the date of grant and have a one
year vesting period.
+-------------+------------+----------+----------+
| | 2009 |
+-------------+----------------------------------+
| | | | Weighted |
+-------------+------------+----------+----------+
| | | | average |
+-------------+------------+----------+----------+
| | Number | | exercise |
| | of | | |
+-------------+------------+----------+----------+
| | share | | price |
| | options | | (in GBP) |
+-------------+------------+----------+----------+
| | | | |
+-------------+------------+----------+----------+
| Outstanding |10,170,536 | | |
| at | | | 0.2300 |
| beginning | | | |
| of period | | | |
+-------------+------------+----------+----------+
| Granted | 1,925,000 | | |
| during | | | 0.1075 |
| the | | | |
| period | | | |
+-------------+------------+----------+----------+
| Forfeited | (525,000) | | 0.2310 |
| during | | | |
| the | | | |
| period | | | |
+-------------+------------+----------+----------+
| Outstanding |11,570,536 | | |
| at the end | | | 0.2082 |
| of the | | | |
| period | | | |
+-------------+------------+----------+----------+
| | | | |
+-------------+------------+----------+----------+
| Exercisable | 5,669,283 | | |
| at the end | | | 0.2190 |
| of the | | | |
| period | | | |
+-------------+------------+----------+----------+
The options are recorded at fair value on the date of grant using the
Black-Scholes model. The inputs into the model are as follows:
+------------+----------+
| | 2009 |
+------------+----------+
| | US$ |
+------------+----------+
| | |
+------------+----------+
| Weighted | 0.16 |
| average | |
| share | |
| price | |
+------------+----------+
| Weighted | 0.16 |
| average | |
| exercise | |
| price | |
+------------+----------+
| Expected | 57.68% |
| volatility | |
+------------+----------+
| Expected | 10 years |
| life | |
+------------+----------+
| Risk | 3.47% |
| free | |
| rate | |
+------------+----------+
| Expected | - |
| dividends | |
+------------+----------+
Expected volatility was determined by calculating the historical volatility of
the Group's share price from the date of the listing to the end of the period.
In 2009, options were granted on 24 March. The aggregate of the estimated fair
values of the options is US $212,905. The Group recognized total costs of
US $327,064 relating to equity-settled share based payment transactions in 2009
which were expensed in the income statements during the period.
12. Events after the balance sheet date
In July and August 2009, the Company made advances of US $40,000 under a
promissory note from m2m Imaging Corp.
In July and August 2009, the Company made advances of US $40,000 under a
promissory note from Motif BioSciences Inc.
In July 2009 and August, the Company made advances of US $160,000 under a
promissory note from PrivateMarkets Inc.
In July 2009, the Company settled one of the two lawsuits brought by a former
employee referred to in Note 10. Under the terms of the settlement agreement,
the Company agreed to pay the former employee US $120,000.
In August 2009, the Company purchased 94,123 D Preference Shares and 60,000 B
Preference Shares of Myconostica Limited for GBP155,000.
In August 2009, the Company issued convertible promissory notes and 240,759
warrants for cash of GBP216,900.
13. Related party transactions
Transactions between the Company and its subsidiaries, which are related parties
of the Company, have been eliminated on consolidation and are not disclosed in
this note. Details of transactions between the Group and other related partners
are disclosed below.
During the period, the Group paid miscellaneous expenses for Motif BioSciences,
Inc. ("Motif") such as office expenses. Motif paid miscellaneous expenses
relating to the Kuwait activity for the Company. At 30 June 2009, the net
amount owed by the Group to Motif is US $27,795.
A subsidiary of the Company has entered into an agreement with Axcess
International Inc. ("Axcess") to provide advisory services. Richard Morgan and
Robert Bertoldi, Directors of the Company, are also Directors of Axcess. Amphion
Innovations US Inc. will receive a monthly fee of US $10,000 pursuant to this
agreement. The agreement is effective until 1 March 2010 and will renew on an
annual basis until terminated by one of the parties. The monthly fee is
suspended for any month in which Axcess' cash balance falls below US $500,000.
Amphion Innovations US Inc. received no fee during the period ended 30 June
2009.
A subsidiary of the Company has entered into an agreement with Kromek to provide
advisory and consulting services. Richard Morgan, a Director of the Company, is
also a Director of Kromek. The monthly fee under this agreement is the lesser of
US $10,000 and 50% of the gross compensation paid to directors and management of
Kromek in that month and can be terminated by one of the parties. The
subsidiary's fee for the period ended 30 June 2009 was US $60,000.Amphion
Innovations US Inc. also received US $69,368 as a fund raising fee for the
period ended 30 June 2009.
A subsidiary of the Company has entered into an agreement with FireStar Software
Inc. ("FireStar') to provide advisory and consulting services. Richard Morgan,
a Director of the Company, is also a Director of FireStar. The annual fee under
this agreement is US $120,000 and expires 31 December 2009. The fee for the
period ended 30 June 2009 was suspended and not recognised.
A subsidiary of the Company has entered into an agreement with Motif
BioSciences, Inc. ("Motif") to provide advisory and consulting services.
Richard Morgan, a Director of the Company, is also a Director of Motif. The
annual fee for the services is US $240,000. The agreement is effective until 1
April 2010 and shall automatically renew for successive one year periods.
Amphion Innovations US Inc.'s fee for the period ended 30 June 2009 was US
$120,000 which was due at 30 June 2009.
A subsidiary of the Company has entered into an agreement with Myconostica
Ltd. ("Myconostica") to provide advisory and consulting services. Richard
Morgan, a Director of the Company, is also a Director of Myconostica.
The monthly fee for the services was GBP4,500 through 20 April and GBP3,000
thereafter and expires 31 December 2009. The subsidiary's fee for the period
ended 30 June 2009 is GBP23,500 or US $34,084 of which US $4,701 was due at 30
June 2009.
A subsidiary of the Company has entered into an agreement with m2m Imaging Corp.
("m2m") to provide advisory and consulting services. Robert Bertoldi, a Director
of the Company, is also a Director of m2m. The quarterly fee under this
agreement is US $45,000. This agreement is effective until 1 November 2009 and
will renew on an annual basis until terminated by either party. Amphion
Innovations US Inc.'s fee for the period ended 30 June
2009 was US $90,000 which was due at 30 June 2009.
A subsidiary of the Company has entered into an agreement with WellGen, Inc.
("WellGen") to provide advisory and consulting services. Richard Morgan and
Robert Bertoldi, Directors of the Company, are also Directors of WellGen. The
fee under this agreement is US $60,000 per quarter.The agreement is effective
until 20 June 2010 and will renew annually for subsequent 12-month periods until
terminated by either party. The subsidiary's fee for the year ended 30 June 2009
was US $120,000.
A subsidiary of the Company has entered into an agreement with PrivateMarkets,
Inc. ("PMI") to provide advisory services. Richard Morgan, a Director of the
Company, is also a Director of PMI. The fee under this agreement is US $15,000
per quarter beginning 7 February 2007 until 31 October 2007, US $30,000 per
quarter from 1 November 2007 until the successful sale of at least US $3,000,000
and thereafter, US $45,000 per quarter. This agreement is effective until 7
February 2010 and will renew annually for subsequent 12-month periods unless
terminated by either party. The subsidiary's fee for the year ended 30 June 2009
was US $60,000. The 2007, 2008 and 2009 fees totaling US $245,000 are due at 30
June 2009.
The Directors' direct ownership in the Partner Companies is as follows:
+-------------------------+----------+-----------+
| | | Fully |
| | | diluted |
+-------------------------+----------+-----------+
| | | % owned |
| | | by |
+-------------------------+----------+-----------+
| Investment company | | directors |
+-------------------------+----------+-----------+
| | | |
+-------------------------+----------+-----------+
| Axcess International, | | 7.37 |
| Inc. | | |
+-------------------------+----------+-----------+
| FireStar Software, Inc. | | 1.62 |
+-------------------------+----------+-----------+
| Kromek Ltd. | | 1.59 |
+-------------------------+----------+-----------+
| Motif BioSciences, Inc. | | 3.73 |
+-------------------------+----------+-----------+
| Myconostica Ltd. | | .33 |
+-------------------------+----------+-----------+
| PrivateMarkets, Inc. | | 2.75 |
+-------------------------+----------+-----------+
| WellGen, Inc. | | 4.63 |
+-------------------------+----------+-----------+
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR GGGMRVLDGLZM
Amphion Innovations (LSE:AMP)
Gráfica de Acción Histórica
De Jun 2024 a Jul 2024
Amphion Innovations (LSE:AMP)
Gráfica de Acción Histórica
De Jul 2023 a Jul 2024
