RNS Number:8277V
Accsys Technologies PLC
16 December 2005
INTERIM RESULTS FOR THE SIX MONTHS TO 30 SEPTEMBER 2005
ACCSYS TECHNOLOGIES PLC ("Accsys" or "the Company")
CHAIRMAN'S STATEMENT
Introduction
Following our successful admission to AIM on 26 October 2005, I am pleased to
report the Group's first set of financial results as a public company.
Construction of wood acetylation plant
The past six months have seen considerable progress on the engineering and
construction of the two major process facilities, with the acetyls processing
unit substantially built for initial testing to commence in Q1 2006 and the
longest lead-time equipment items ordered for the wood processing unit.
Mechanical completion of the total facility is presently scheduled for Q3 2006,
with commercial start-up shortly thereafter.
Strong interest from both customers and prospective licensees (see below) led to
a decision to relocate part of production to an adjacent area in order to (a)
allow easier future expansion and (b) release an existing building unit for the
development of another production line. Two suitable areas have been identified
and negotiations are in progress to secure an optimal arrangement. Although not
yet completed, the planned move is not expected to affect the completion and
start-up schedule.
Product and customer development
The transition from process development to product enhancement continued during
the period, with pilot plant production for customer trials increasing to
reflect high levels of interest from both end-users and potential licensees.
Titan Wood responded to this interest by building its production team and
increasing production of sample materials, accompanied by an investment
programme to enhance the development and testing facility. Basic technical
research was completed in all areas of product performance, with very
encouraging results. Strong customer interest has led to a re-evaluation of
future production volumes at the site and arrangements for future expansion are
now being incorporated into the design and layout of the first generation
full-sized plant.
Licensing
The primary goal of the business is to maximise returns through licensing the
Group's production technology. The company wishes to exploit its "first mover"
advantage and has been implementing an ambitious programme of international
licensing for its wood acetylation technology. The past six months saw
considerable success, with eight licensee testing programmes now underway with
partners in four continents. Following the sale of an option on a licence in
the previous financial period, negotiations for licences have progressed with
several parties.
Dividends
The directors do not intend to pay a dividend until the Company has established
strong cash flow and reported satisfactory profitability.
The corporate restructure undertaken prior to the admission to AIM was intended
to facilitate the future payment of dividends by removing the accumulated
deficit on the profit and loss account of the parent company. This has been
partly achieved through the creation of the new holding company. The
consolidated deficit of Euro80m at 30 September 2005 relates almost wholly to
subsidiary companies. The Company is now in the process of completing the
restructure by taking direct ownership of the subsidiaries likely to generate
future licence income and the former intermediate holding company will be
liquidated.
Willy Paterson-Brown
Executive Chairman
FINANCIAL INFORMATION
Basis of Preparation
Accsys Technologies PLC was incorporated on 11 August 2005 and as at 30
September 2005, its balance sheet was represented by Euro0.02 in cash and Euro0.02 of
share capital. The company had not earned any income or incurred any expenses
to that date nor had it any other recognised gain or loss.
The acquisition of Accsys Chemicals PLC by the Company took effect after 30
September 2005, with Accsys Chemicals PLC becoming wholly owned on 22 November
2005 following a share for share exchange. Although this group reconstruction
took place after 30 September 2005, the directors decided to present interim
financial information based on the results of Accsys Chemicals PLC as they
believed that this would give much more meaningful and useful information.
Accordingly, the consolidated results for the six months to 30 September 2005,
six months to 30 September 2004 and the year to 31 March 2005 and the balance
sheets as at those dates are those of Accsys Chemicals PLC. The comparative
figures for the six months to 30 September 2004 and the balance sheet at that
date were converted to euros at the period end rate. After that date the
company reported in euros.
These proforma interim financial statements for Accsys Technologies PLC have
therefore been prepared on a basis consistent with the accounting policies set
out in the Accsys Chemicals PLC annual report and accounts for the year ended 31
March 2005 and in the AIM Admission document published on 20 October 2005.
The independent auditors' report on the 2005 Accsys Chemicals PLC accounts was
unqualified and did not contain any statement under section 237(2) or (3) of the
Companies Act 1985. The financial information in this document does not
constitute statutory financial statements within the meaning of section 240 of
the Companies Act 1985.
INTERIM FINANCIAL STATEMENTS TO 30 SEPTEMBER 2005
Consolidated profit and loss account
Unaudited Unaudited Audited
6 months ended 6 months ended Year ended
30 September 2005 30 September 2004 31 March 2005
Euro'000 Euro'000 Euro'000
Administrative expenses
General administrative expenses (2,327) (1,478) (2,965)
Impairment of intangible
fixed assets - - (24,514)
_________ _________ _________
Administrative expenses
and operating loss (2,327) (1,478) (27,479)
Interest receivable and similar
income 111 2 18
_________ _________ _________
Loss on ordinary activities
before and after taxation (2,216) (1,476) (27,461)
Minority interest - 527 841
_________ _________ _________
Retained loss for the
period/year (2,216) (949) (26,620)
_________ _________ _________
Basic and diluted loss per share Euro(0.02) Euro(0.02) Euro(0.43)
All amounts relate to continuing activities
Consolidated statement of total recognised gains and losses
Loss for the period/year (2,216) (2,216) (26,620)
Exchange translation differences on (2,216)
consolidation and conversion to - (776) (1,095)
euro
_________ _________ _________
Total recognised gains and
losses for the period/year (2,216) (1,725) (27,715)
_________ _________ _________
The notes set out on pages 7 to 11 form part of these interim financial
statements
Consolidated Balance Sheet
Unaudited Unaudited Audited
6 months ended 6 months ended Year ended
30 September 2005 30 September 2004 31 March 2005
Euro'000 Euro'000 Euro'000
Notes
Fixed assets
Intangible assets 14,246 35,272 14,246
Tangible assets 4,655 1,665 2,842
_________ _________ _________
18,901 36,937 17,088
_________ _________ _________
Current assets
Debtors 562 332 608
Deposits 8,726 - 5,616
Cash at bank 921 1,355 4,564
_________ _________ _________
10,209 1,687 10,788
Creditors: amounts falling due
within one year (1,178) (4,825) (1,922)
_________ _________ _________
Net current assets/(liabilities) 9,031 (3,138) 8,866
_________ _________ _________
Net assets 27,932 33,799 25,954
_________ _________ _________
Capital and reserves
Called up share capital 1 49,575 35,888 47,295
Share premium account 18,203 6,963 16,288
Merger reserve 40,132 40,957 40,132
Profit and loss account (79,978) (53,457) (77,761)
_________ _________ _________
Shareholders' funds 2 27,932 30,351 25,954
Minority interests - equity - 3,448 -
_________ _________ _________
27,932 33,799 25,954
_________ _________ _________
Included within shareholders' funds is an amount of Euro23,209,000 (30 September
2004 Euronil; 31 March 2005 Euro23,209,000) in respect of non-equity interests.
The notes set out on pages 7 to 11 form part of these interim financial
statements
Consolidated cash flow statement
Unaudited Unaudited Audited
6 months ended 6 months ended Year ended
30 September 2005 30 September 2004 31 March 2005
Euro'000 Euro'000 Euro'000
Notes
Net cash outflow from
operating activities 3 (1,802) (1,161) (2,513)
Returns on investments and
servicing of finance
Interest received 111 2 18
Capital expenditure and
financial investment
Purchase of tangible fixed
assets (1,842) (525) (2,210)
_________ _________ _________
Cash outflow before use of
liquid resources and financing (3,533) (1,647) (4,705)
Management of liquid
Resources
Increase in short term deposits (3,110) - (5,616)
Financing
Increase in loans - 796 1,434
Issue of share capita 3,000 - 11,773
Expenses of issue of share
capital - - (565)
Shares issued by subsidiary to
Minority - 800 800
_________ _________ _________
Decrease)/increase in cash (3,643) (88) 3,121
_________ _________ _________
The notes set out on pages 7 to 11 form part of these interim financial
statements
Notes forming part of the interim financial statements for the period ended 30
September 2005
1. Share capital of Accsys Chemicals PLC
6 months ended 6 months ended Year ended
30 September 2005 30 September 2004 31 March 2005
Euro'000 Euro'000 Euro'000
Authorised
Equity share capital
493,700,000 ordinary shares of
Euro0.25c each 123,425 - 123,425
200,000,000 ordinary shares of
50p each - 150,000 -
Non-equity share capital
48,700,000 deferred shares of
33p each 23,464 - 23,464
_________ _________ _________
146,889 150,000 146,889
_________ _________ _________
Issued and fully paid
Equity share capital
Ordinary shares of Euro0.25c each:
At 30 September 2005: 105,463,447 26,366 - -
At 31 March 2005: 96,344,308 - - 24,086
Ordinary shares of 50p each
At 30 September 2004: 48,171,536 - 35,888 -
Non-equity share capital
Deferred shares of 33p each, 48,171,536 23,209 - 23,209
_________ _________ _________
49,575 35,888 47,295
_________ _________ _________
Notes forming part of the interim financial statements for the period ended 30
September 2005
2. Reconciliation of movements in shareholders' funds
6 months ended 6 months ended Year ended
30 September 2005 30 September 2004 31 March 2005
Euro'000 Euro'000 Euro'000
Loss for the period/year (2,216) (949) (26,620)
Other recognised gains/ (losses)
relating to the period - (776) 1,155
Exchange difference on
conversion to euro - - (2,250)
Shares issued in the period/year 4,194 - 21,593
_________ _________ _________
Net increase/(decrease) in
shareholders' funds 1,978 (1,725) (6,122)
Opening shareholders' funds 25,954 32,076 32,076
_________ _________ _________
Closing shareholders' funds 27,932 30,351 25,954
_________ _________ _________
3. Reconciliation of operating loss to net cash outflow from operating activities
6 months ended 6 months ended Year ended
30 September 2005 30 September 2004 31 March 2005
Euro'000 Euro'000 Euro'000
Operating loss (2,327) (1,478) (27,479)
Depreciation of tangible fixed
assets 29 374 838
Impairment of intangible fixed
Assets - - 24,514
Decrease/(increase) in debtors 46 (151) (476)
Increase in creditors 450 94 90
_________ _________ _________
Net cash flow from operating
activities (1,802) (1,161) (2,513)
_________ _________ _________
Notes forming part of the interim financial statements for the period ended 30
September 2005
4. Reconciliation of net cash flow to movement in net funds/(debt)
6 months ended 6 months ended Year ended
30 September 2005 30 September 2004 31 March 2005
Euro'000 Euro'000 Euro'000
(Decrease)/increase in cash in
the period/year (3,643) (88) 3,121
Cash flow from increase in debt - (796) (1,434)
_________ _________ _________
Change in net debt resulting
from cash flows (3,643) (884) 1,687
Shares issued in settlement of debt 1,195 - 3,000
Other non-cash movements - - 150
Exchange differences - 21 115
_________ _________ _________
Movement in net debt in the
period/year (2,448) (863) 4,952
Opening net funds/(debt) 3,369 (1,583) (1,583)
_________ _________ _________
Closing net funds/(debt) 921 (2,446) 3,369
_________ _________ _________
Notes forming part of the interim financial statements for the period ended 30
September 2005
5. Analysis of net debt
Other Opening Cash non-cash Closing
balance flow changes balance
Euro'000 Euro'000 Euro'000 Euro'000
Period ended 30 September 2005
Cash in hand and at bank 4,564 (3,643) - 921
Debt due within one year (1,195) - 1,195 -
_______ _______ _______ _______
Total 3,369 (3,643) 1,195 921
_______ _______ _______ _______
Period ended 30 September 2004
Cash in hand and at bank 1,443 (88) - 1,355
Debt due within one year (3,026) (796) 21 (3,801)
_______ _______ _______ _______
Total (1,583) (884) 21 (2,446)
_______ _______ _______ _______
Year ended 31 March 2005
Cash in hand and at bank 1,443 3,121 - 4,564
Debt due within one year (3,026) (1,434) 3,265 (1,195)
_______ _______ _______ _______
Total (1,583) 1,687 3,265 3,369
_______ _______ _______ _______
Notes forming part of the interim financial statements for the period ended 30
September 2005
6. Loss per Accsys Chemicals PLC share
The loss per share is shown below is calculated based upon the weighted average
number of Accsys Chemicals PLC Ordinary shares in issue.
6 months ended 6 months ended Year ended
30 September 2005 30 September 2004 31 March 2005
Weighted average number of
Ordinary shares in issue 105,260,799 48,171,536 61,596,033
Loss for the period/year Euro'000 (1,716) (949) (26,620)
Loss per share Euro(0.02) Euro(0.02) Euro(0.43)
Since none of the Accsys Chemicals PLC's Ordinary shares are dilutive, there is
no difference between basic and diluted loss per share.
7. Post balance sheet events
On 26 October 2005, the Company completed the placing of 27,000,000 new Ordinary
shares at a price of Euro1.00 each raising approximately Euro25,850,000 after expenses
and its Ordinary shares were admitted to AIM.
On 22 November 2005, the Company completed its acquisition of the Ordinary and
Deferred shares of Accsys Chemicals PLC, which became wholly owned, and also
completed the offer in respect of options over Ordinary shares in Accsys
Chemicals PLC. As a result of the offers the total number of Accsys
Technologies PLC shares in issue and options granted over shares at the date of
this report is:
Issued and fully paid Ordinary shares of Euro1.00 each 132,463,447
Options granted over Ordinary shares of Euro1.00 each 5,788,000
Issued and fully paid Deferred shares of 10p each 100,000
Independent review report to ACCSYS TECHNOLOGIES plc
Introduction
We have been instructed by the company to review the financial information set
out on pages 3 to 11 for the six months ended 30 September 2005 which has been
prepared on the basis set out in "Basis of Preparation". We have read the other
information contained in the interim report and considered whether it contains
any apparent misstatements or material inconsistencies with the financial
information.
Our report has been prepared in accordance with the terms of our engagement to
assist the company in meeting the requirements of the rules of the London Stock
Exchange for companies trading securities on the Alternative Investment Market
and for no other purpose. No person is entitled to rely on this report unless
such a person is a person entitled to rely upon this report by virtue of and for
the purpose of our terms of engagement or has been expressly authorised to do so
by our prior written consent. Save as above, we do not accept responsibility
for this report to any other person or for any other purpose and we hereby
expressly disclaim any and all such liability.
Directors' responsibilities
The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by the directors. The directors are
responsible for preparing the interim report in accordance with the rules of the
London Stock Exchange for companies trading securities on the Alternative
Investment Market which require that the half-yearly report be presented and
prepared in a form consistent with that which will be adopted in the company's
annual accounts having regard to the accounting standards applicable to such
annual accounts.
Review work performed
We conducted our review in accordance with guidance contained in Bulletin 1999/4
issued by the Auditing Practices Board for use in the United Kingdom by auditors
of fully listed companies. A review consists principally of making enquiries of
group management and applying analytical procedures to the financial information
and underlying financial data and based thereon, assessing whether the
accounting policies and presentation have been consistently applied unless
otherwise disclosed. A review excludes audit procedures such as tests of
controls and verification of assets, liabilities and transactions. It is
substantially less in scope than an audit performed in accordance with United
Kingdom Auditing Standards and therefore provides a lower level of assurance
than an audit. Accordingly we do not express an audit opinion on the financial
information.
Review conclusion
On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the six months
ended 30 September 2005.
BDO STOY HAYWARD LLP
Chartered Accountants
London
Date:
This information is provided by RNS
The company news service from the London Stock Exchange
END
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