8PG.L Regulatory News (8PG)

25 Sep 2007 15:46

Legendary Investments PLC25 September 2007 LEGENDARY INVESTMENTS PLC PRELIMINARY RESULTS FOR THE YEAR ENDED 31 MARCH 2007 CHIEF EXECUTIVE'S STATEMENT REVIEW OF ACTIVITIES In the year under review, Legendary Investments plc (the "Company") assessedinvestments, both on and off-market, where the investees might benefit from theCompany's hands-on investment process in which the investees are assisted incertain areas such as product development and marketing. No suitable investmentswere found. In order to utilise available funds, certain medium term investments were madein listed securities. Losses on investments amounted to £93,000; these wereprimarily due to losses on illiquid investments made in the previous year. Thiscompares with net losses on investments of £452,000 for the previous year. Administrative expenses amounted to £77,000. Due to the Chief Executive writingoff £170,000 of loan that he had made to the Company, the Company had netadministrative income of £93,000. This compares with administrative expenses of£106,000 for the previous year (net administrative expenses of £58,000 includinga £48,000 write back for services provided to Legendary Investments by a companycontrolled by the Chief Executive. For the year under review, no charges weremade to Legendary Investments for such services). Overall the Company broke even for the year under review. This compares with anet loss of £510,000 for the previous year. OUTLOOK The losses in previous years have resulted in a deficit in the shareholders'funds. As a result of these losses, in the year under review the Chief Executivewrote off £170,000 of loan that he had made to the Company. The Board isexploring various options to address the deficit in the shareholders' funds,including strengthening the balance sheet. Eaitisham AhmedChief Executive25 September 2007 Registered Office: 2nd FloorBerkeley Square HouseBerkeley SquareLondon W1J 6BD For further information please contact: Zafar Karim, Legendary Investments 0207 887 1335James Caithie, City Financial Associates Limited 0207 492 4777 PROFIT AND LOSS ACCOUNTFOR THE YEAR ENDED 31 MARCH 2007 Note 2007 2006 £'000 £'000 Net losses on investments held for trading (93) (452)Net administrative income /(expenses) 93 (58) Loss on ordinary activities before taxation 2 - (510)Taxation 4 - - Loss for the financial year 13 - (510) Loss per share - basic and fully diluted 5 (0.0p) (0.1p) A separate statement of recognised gains and losses has not been prepared as theCompany has no recognised gains or losses in the current or prior period otherthan the losses for the periods. All activities are continuing. BALANCE SHEETAS AT 31 MARCH 2007 2007 2006 Notes £'000 £'000 FIXED ASSETS Available for sale investments 7 - 9 CURRENT ASSETS Investments held for trading 8 75 91Cash at bank and in hand 4 43 79 134 CREDITORS: amounts falling due within one year 9 (119) (183) NET CURRENT LIABILITIES (40) (49) NET LIABILITIES (40) (40) CAPITAL AND RESERVESCalled up share capital 10 628 628Share premium account 11 8,270 8,270Profit and loss account - deficit 12 (8,938) (8,938) EQUITY SHAREHOLDERS' DEFICIT 13 (40) (40) The financial statements were approved by the Board and authorised for issue on25 September 2007 Eaitisham AhmedChief Executive CASH FLOW STATEMENTFOR THE YEAR ENDED 31 MARCH 2007 Notes 2007 2006 £'000 £'000 NET CASH OUTFLOW FROM OPERATING ACTIVITIES 14 (144) (506) FINANCINGDirector's loan 105 122 (DeCREASE)/INCREASE IN CASH 16 (39) (384) 1 ACCOUNTING POLICIES Accounting convention The accounts have been prepared in accordance with applicable accounting standards and under the historical cost convention, modified by therevaluation of investments. Tangible fixed assets and depreciation Tangible fixed assets are stated at cost less depreciation. Depreciation isprovided at rates calculated to write off the cost less the estimated residualvalue of each asset over its expected useful life, as follows: Office equipment, furniture and fittings 3 - 4 years Impairment of asset values Where asset values are impaired, they are written down to their economic valueto the business. Financial instruments Financial assets and financial liabilities are recognised on the company'sbalance sheet when the company has become a party to the contractual provisionsof the instrument. All investments are initially recognised at cost, being the fair value of theconsideration given and including acquisition charges associated with theinvestment. After initial recognition, investments that are classified as held for tradingare measured at fair value. Gains or losses on investments held for trading arerecognised in income. For investments that are actively traded in organised financial markets, fairvalue is determined by reference to Stock Exchange quoted market bid and offerprices at the close of business on the balance sheet date. Unlisted investmentshave been based on cost less impairment as there is insufficient information toenable a valuation to be performed. Derivative financial instruments The company's activities expose it primarily to market risk. The company usesderivatives to minimise the initial monetary investment required. Derivative financial instruments are carried at fair market value and resultantprofit and losses are included in the profit and loss account. Assets orliabilities resulting from gains or losses on open positions are reported asderivative financial assets or liabilities. Fair value is determined byreference to third party market values. The company does not use derivativefinancial instruments for hedge accounting purposes. Deferred taxation Deferred tax is recognised in respect of differences between the Company'staxable profits and its results as stated in the financial statements that haveoriginated but not reversed at the balance sheet date. Deferred tax assets are only recognised where there is an expectation that theywill result in a reduction in corporation tax payments in the foreseeablefuture. Deferred tax is measured at the average tax rates that are expected to apply inthe periods in which timing differences are expected to reverse, based on taxrates and laws that have been enacted or substantially enacted by the balancesheet date. Deferred tax is measured on a non-discounted basis. Foreign currency translation Monetary assets and liabilities denominated in foreign currencies are translatedinto sterling at the rates of exchange ruling at the accounting date.Transactions in foreign currencies are recorded at the rate ruling at the dateof the transaction. All differences are taken to profit and loss account. Going concern The directors have carried out cost projections for the company and comparedthese with the availability of finance from the director's loan facility. Basedon this, the Directors have formed a judgement, at the time of approving theaccounts, that there is a reasonable expectation that the Company has adequateresources to continue in operational existence for the foreseeable future. Forthis reason the Directors continue to adopt the going concern basis in preparingthe accounts. 2 LOSS ON ORDINARY ACTIVITIES BEFORE TAX 2007 2006 £'000 £'000Loss on ordinary activities before tax for the year is stated aftercharging/ (crediting): Auditor's remuneration - statutory audit 12 12Services relating to taxation 7 8Other services 7 8Waiver of loan (see note 18) (170) - 3 DIRECTORS 2007 2006 Number Number NUMBER OF EMPLOYEESThe average number of employees, including directors, during the yearwas: 2 2 £'000 £'000DIRECTORS' EMOLUMENTS Aggregate emoluments 12 47 EMOLUMENTS OF HIGHEST PAID DIRECTOR:Remuneration 12 35 4 TAX ON PROFIT ON ORDINARY ACTIVITIES 2007 2006 £'000 £'000Analysis of charge in the year:Current tax - -Deferred tax - - - -Factors affecting tax charge for year:The tax assessed for the year is lower than the standardrate of corporation tax in the UK (30%). The differences are explainedbelow: Loss on ordinary activities before tax - (510) Loss on ordinary activities multiplied by standard rate of corporation tax in the UK 30% (2006: 30%) - (153)Expenses not deductible for tax purposes - 2Tax losses carried forward - 151 Current tax charge for year - - 4 TAXATION (continued) The reported losses include losses on fixed asset investments which are onlyrelievable against future capital profits. As at 31 March 2007 the Company had corporation tax revenue losses ofapproximately £5.6 million (2006: £5.4m) available to carry forward againstfuture income. No deferred tax asset is recognised in respect of these lossesdue to the uncertainty as to the utilisation of the losses in the foreseeablefuture. Future tax charges will be dependent on the split of profits for tax purposes asbetween revenue and capital items, and the utilisation of losses incurred todate. 2007 20065 LOSS PER ORDINARY SHARE £'000 £'000 Attributable loss (£'000) - (510) Average number of ordinary shares in issue ('000) 627,667 627,667 Average number of ordinary shares in issue and over which options have been granted ('000) 627,667 627,667 Basic loss per share (pence) 0.0p 0.1p Fully diluted loss per share (pence) 0.0p 0.1p The share options and warrants do not give rise to any dilution and thereforethe fully diluted loss per share is equal to the basic loss per share. 6 TANGIBLE ASSETS Office equipment, furniture & fittings £'000 COST At 31 March 2006 and 31 March 2007 12 DEPRECIATION At 31 March 2006 and 31 March 2007 12 NET BOOK VALUE At 31 March 2007 and 31 March 2006 - 7 AVAILABLE FOR SALE FINANCIAL ASSETS 2007 2006 £'000 £'000 Unlisted investments - 9 8 FINANCIAL ASSETS HELD FOR TRADING 2007 2006 £'000 £'000 Listed investments 75 91 9 CREDITORS: amount falling due within one year 2007 2006 £'000 £'000 Accruals 61 60Directors' loan (note 18) 58 123 119 183 10 SHARE CAPITAL AND SHARE OPTIONS 2007 2006 £'000 £'000 AUTHORISED 3,000,000,000 ordinary shares of £0.001 each 3,000 3,000 ALLOTTED, CALLED UP AND FULLY PAID627,667,198 ordinary shares of £0.001 each 628 628 SHARE OPTIONS The Company has unapproved and approved share option schemes in which theDirectors participate. Details of Directors' outstanding share options areshown below: Exercise Number at Number at Price 31 March 1 April (per share) 2007 2006 Eaitisham Ahmed 2p 125,000,000 125,000,000Zafarullah Karim 0.8p 75,000,000 75,000,000 The options remains extant, as long as their holder remains an employee of thecompany. The Market price of the Company's ordinary shares ranged from a high of 0.23p toa low of 0.03p during the year and was 0.09p on 31 March 2007. Since 31 March2007 to the date of this report, no options have been granted or exercised. 11 SHARE PREMIUM ACCOUNT 2007 2006 £'000 £'000 At 31 March 8,270 8,270 12 PROFIT AND LOSS ACCOUNT 2007 2006 £'000 £'000 At 1 April 2006 (8,938) (8,428)Loss for the year - (510) At 31 March 2007 (8,938) (8,938) 13 RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS 2007 2006 £'000 £'000 Opening shareholders' funds (40) 470Loss for the financial year - (510) Closing shareholders' deficit (40) (40) 14 RECONCILIATION OF OPERATING LOSS TO NET CASH 2007 2006 (OUTFLOW)/INFLOW FROM OPERATING ACTIVITIES £'000 £'000 Operating loss - (510)Impairment of financial asset investments 25 -Waiver of director's loan (170) -Decrease in debtors - 26Increase/(decrease) in creditors 1 (22) Net cash (outflow)/inflow from operating activities (144) (506) 15 ANALYSIS OF NET (DEBT)/ FUNDS At 31 March Cash flows Non-cash At 31 March 2006 movements 2007 £'000 £'000 £'000 £'000 Cash at bank and in hand 43 (39) - 4Director's loan (123) (105) 170 (58) (80) (144) 170 (54) 16 RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET DEBT £'000 (Decrease) in cash in the year (39)Cash (outflow)/inflow from financing activities (105) Non-cash movement 170Net debt at 31 March 2006 (80) Net (debt)/ funds at 31 March 2007 (54) 17 FINANCIAL INSTRUMENTS Short term debtors and creditors Short term debtors and creditors have been excluded from all the followingdisclosures other than currency risk disclosure. Interest rate risk Floating rate financial liabilities of £Nil (2006: £3,000) bear interest atrates based on LIBOR plus 1-1.5%. Cash at bank earns interest at floating ratesbased on LIBOR. Borrowing facilities At the year end the company had no overdraft facility (2006: £Nil). Currency risk During the year, the company had no exposure to currency risk. 18 RELATED PARTY TRANSACTIONS During the year the company received funding from the Chief Executive andincurred expenditure on his behalf. As at the balance sheet date, the amountadvanced by the Chief Executive to the company amounted to £57,890 (2006:£123,220). This sum is interest free and there are no fixed terms for repayment.In addition the chief executive agreed to write off a balance of £170,000 due tohim by the company. The maximum balance that was outstanding during the year was£176,448 (2006: £435,750). This information is provided by RNS The company news service from the London Stock Exchange