Last checked at 9 Sep 2008 11:42
Cinpart Plc ("Cinpart" or the "Company")
Interim Results For the six months ended 30 June 2008 ("Interims")
CHAIRMAN'S COMMENTARY
I present the interim results for Cinpart plc for the six month period ended 30 June 2008.
Trading conditions have been difficult throughout this period and consequently the revenue for the Group was £1,090,907 compared with £1,492,836 reported in the same period in 2007.
The Group reports a loss for the six month period ended 30 June 2008 of £194,416. The loss in the same period in 2007 was £11,486
A number of factors have contributed to the decline in sales: a number of customers increased inventories during the latter part of 2007 and having greater confidence following the successful reorganisation of the Group have reduced these inventories during the first six months of 2008. The majority of customers have reduced levels of business due to adverse economic conditions.
During the first six months of 2008 there have been wide fluctuations in the exchange rate between Baht, the currency of Thailand where the companies manufacturing operation is located and £ sterling which is the reporting currency used by the Group. While the exchange rate at 30 June 2008 was similar to that at 31 December 2007, average rates during each month used to evaluate expenses were as much as 7% lower thus the reported expenses in £ are higher.
In April 2008, an application was filed to liquidate two Thai companies that have not traded for some time. While all expenses had been provided for in previous years, there remained a cost relating to exchange differences that applied when these company's balance sheets were removed from the group accounts in April 2008. Exchange adjustments charged to expenses were £60,277 and of this £39,256 are attributable to the two Thai subsidiaries liquidated.
The Group has been successful in improving gross margins to 39.2% during the first six months of 2008 compared with 29.8% in the first six months of 2007. This has been largely achieved through a program of cost reduction and by the addition of plant and equipment including stamping presses and a circuit board manufacturing facility.
The Group has invested heavily to develop an appropriate infrastructure to support the future organic growth of the current operation. This includes hiring and training technical and sales support staff and further initiatives in marketing. These are expected to come to fruition during the remainder of this year and during 2009. The Group also expects to receive ISO certification before the end of 2008 and this will enable the Group to sell to new customers particularly in Europe.
Additionally Cinpart has established a new trading company in the United Kingdom to source components from Asia and or China for sale to small and medium enterprises in the United Kingdom.
The Directors expect that trading during the second half of 2008 will be profitable and for the initiatives in sales and other activities to improve trading in the near future.
Philip E. Palmer
Chairman
The Interims are available in full on the company's website www.cinpart.com
| Kevin Baker - Cinpart Plc | + 662 709 2647 |
| Ray Zimmerman /Jonathan Evans - Zimmerman Adams International Limited | (020) 7060 1760 |
| Stephen Goschalk - Newland Stockbrokers | (020) 7290 2414 |
UNAUDITED CONSOLIDATED INCOME STATEMENT
For the six months ended 30 June 2008
|
| Six Months | Six Months | Year Ended | |||||
| Ended 30 June | Ended 30 June | 31 December | ||||||
| 2008 | 2007 | 2007 | ||||||
| Unaudited | Unaudited | |||||||
| £ | £ | £ | ||||||
| Revenue | 1,090,907 | 1,492,836 | 2,816,496 | |||||
| Cost of Sales | (662,884) | (1,047,350) | (1,872,232) | |||||
| Gross profit | 428,023 | 445,486 | 944,264 | |||||
| Other operating income | 4,541 | 93,678 | ||||||
| Administrative expense | (619,104) | (430,950) | (854,663) | |||||
| Operating (loss)/profit | (186,540) | 14,536 | 183,279 | |||||
| Finance expense | (8,885) | (26,050) | (72,059) | |||||
| Finance income | 1,009 | 28 | 2,676 | |||||
| (Loss)/profit before tax | (194,416) | (11,486) | 113,896 | |||||
| Tax | - | - | - | |||||
| (Loss)/profit for the period | (194,416) | (11,486) | 113,896 | |||||
| Earnings per share for profit attributable to the equity holders | ||||||||
| during the period | ||||||||
| Basic (pence) | -0.61 | - 0.13 | 0.57 | |||||
| Diluted (pence) | -0.52 | -0.08 | 0.47 | |||||
UNAUDITED STATEMENT OF RECOGNISED INCOME AND EXPENSE
For the six months ended 30 June 2008
| Six Months | Six Months | Year Ended | ||||||
| Ended 30 June | Ended 30 June | 31 December | ||||||
| 2008 | 2007 | 2007 | ||||||
| Unaudited | Unaudited | |||||||
| £ | £ | £ | ||||||
| Exchange gain on retranslation of foreign operations | 14,011 | 12,233 | 8625 | |||||
| Net expense recognized directly in equity | 14,011 | 12,233 | 8,625 | |||||
| (Loss)/profit for the period | (194,416) | (11,486) | 113,896 | |||||
| Total recognized income and expense for the period |
(180,405) |
747 |
122,521 | |||||
UNAUDITED CONSOLIDATED BALANCE SHEET
At 30 June 2008
|
| 30 June | 30 June | 31 December | |||||
| 2008 | 2007 | 2007 | ||||||
| Unaudited | Unaudited | |||||||
| £ | £ | £ | ||||||
| Assets | ||||||||
| Non-current assets | ||||||||
| Goodwill | 105,028 | 105,028 | 105,028 | |||||
| Property, plant and equipment | 177,948 | 113,606 | 178,280 | |||||
| 282,976 | 218,634 | 283,308 | ||||||
| Current assets | ||||||||
| Inventories | 307,626 | 198,778 | 281,961 | |||||
| Trade and other receivable | 564,894 | 806,662 | 787,796 | |||||
| Cash and cash equivalents | 20,260 | 482,450 | 98,717 | |||||
| 892,780 | 1,487,890 | 1,168,474 | ||||||
|
|
|
| ||||||
| Total assets | 1,175,756 | 1,706,524 | 1,451,782 | |||||
| Liabilities | ||||||||
| Current liabilities | ||||||||
| Trade and other payables | 357,051 | 768,487 | 475,124 | |||||
| Financial liabilities - borrowings | ||||||||
| Bank overdrafts | - | - | - | |||||
| Interest bearing loans and borrowings | 100,393 | 170,331 | 118,483 | |||||
| 457,444 | 938,818 | 593,607 | ||||||
| Net current assets/(liabilities) | 435,336 | 549,072 | 574,867 | |||||
| Non current liabilities | ||||||||
| Financial liabilities - borrowings | ||||||||
| Interest bearing loans and borrowings | - | 13,000 | 13,498 | |||||
| Total liabilities | 457,444 | 951,818 | 607,105 | |||||
| Net assets/(liabilities) | 718,312 | 754,706 | 844,677 | |||||
| Equity | ||||||||
| Called up share capital | 3,766,748 | 3,756,907 | 3,759,763 | |||||
| Share premium | 2,233,163 | 2,353,419 | 2,186,108 | |||||
| Merger reserve | 128,571 | - | 128,571 | |||||
| Retained earnings | (5,485,186) | (5,416,152) | (5,290,770) | |||||
| Share option reserve | 88,081 | 84,000 | 88,081 | |||||
| Foreign exchange reserve | (13,065) | (23,468) | (27,076) | |||||
| Total equity | 718,312 | 754,706 | 844,677 | |||||
UNAUDITED CASH FLOW STATEMENT
For the six months ended 30 June 2008
| Six Months | Six Months | Year Ended | ||||||
| Ended 30 June | Ended 30 June | 31 December | ||||||
| 2008 | 2007 | 2007 | ||||||
| Unaudited | Unaudited | |||||||
| £ | £ | £ | ||||||
| Net cash used in operating activities | (69,919) | (58,187) | (135,040) | |||||
| Investing activities | ||||||||
| Acquisition of subsidiary, cash acquired | (205,840) | 10,886 | ||||||
| Purchase of property plant and equipment | (23,115) | (22,798) | (87,591) | |||||
| Sale of property plant and equipment | 25,385 | |||||||
| Interest received | 1,009 | 28 | 2,676 | |||||
| Net cash used in investing activities | (22,106) | (228,610) | (48,644) | |||||
| Financial activities | ||||||||
| (Repayment)/issue of loans | - | (13,000) | ||||||
| Receipt of/(repayment) finance leases | 24,256 | - | (11,774) | |||||
| (Repayment)/increase in bank and other borrowing | (55,844) | (704,250) | (424,065) | |||||
| Proceeds on issue of shares | 54,040 | 1,492,302 | 815,513 | |||||
| Interest paid | (8,885) | (26,050) | (62,167) | |||||
| Net cash from financing activities | 13,567 | 762,002 | 304,507 | |||||
| Cash and cash equivalents at beginning of period | 98,717 | 7,245 | (22,106) | |||||
| Cash and cash equivalents at end of period | 20,260 | 482,450 | 98,717 | |||||