31 Oct 2011 15:40
31 October 2011
Creon Corporation Plc
Interim results for the six months ended 31 July 2011
Creon Corporation Plc (AIM: CRO) ("Creon", the "Group", or the "Company") today announces its interim results for the six months ended 31 July 2011.
DIRECTORS' REPORT
Operations
As previously announced by the Company, Creon's ordinary shares were suspended from trading on AIM on 22 September 2011 due to fundamental uncertainty of the Company's financial position. The key extract of the text of that announcement is set out below:
"On 7 July 2011, the Company announced that repayment of a loan totalling £105,602 (including accrued interest) (the "Loan") together with the proceeds of the placing which raised £24,000, would be used by the Company to pay the ongoing running costs associated with being a public company until suitable investments had been identified and further equity funds raised.
The expected repayment of the Company's outstanding Loan has not been forthcoming as expected. The Directors now believe that it is unlikely that repayment will be made under this Loan in the very short term, if at all, and therefore the Directors are in detailed discussions with the Company's advisers to find alternative sources of short term funding, which may take the form of a deeply discounted issue of new equity. Shareholders should be aware that at this stage there can be no guarantee that funding will be found."
The directors remain in discussions with its advisers on further cash injections and further announcements will be made in due course, although the directors would like to stress that there remains no guarantee that additional funding will be found. If no further funding can be found, the directors may need to consider commencing liquidation proceedings.
Financial review
The Group recorded a loss during the period under review of £135,186,however this included a specific provision against the Loan of £93,246. Administration costs for the Group were £41,740 during the period. Loss per share for the period was 0.3p.
The Group's net assets at the period end of £305,000 remain weighted towards the investment in the unquoted 7% preference share which is not due for repayment until September 2013. The board is in discussions regarding early repayment of this preference share in order to raise cash, although shareholders should be aware that any repayment is likely to be at a significant discount to face value.
CREON CORPORATION PLC
GROUP STATEMENT OF COMPREHENSIVE INCOME
for the six months ended 31 July 2011
Note | 6 months ended 31.7.11 £'000 | 6 months ended 31.7.10 £'000 | 12 months ended 31.1.11 £'000 | |
Revenue | - | - | 10 | |
Cost of Sales | - | 10 | - | |
______ | ______ | ______ | ||
Gross profit / (loss) | - | 10 | (10) | |
Administrative expenses | (135) | (67) | (121) | |
| ______ | ______ | ______ | |
Loss from operations | (135) | (57) | (111) | |
Financial income | - | 7 | 12 | |
______ | ______ | ______ | ||
Loss on ordinary activities before taxation | (135) | (50) | (99) | |
Tax on (loss) on ordinary activities | - | - | 19 | |
______ | ______ | ______ | ||
Loss on ordinary activities after taxation | (135) | (50) | (80) | |
______ | ______ | ______ | ||
Loss per share | 1 | (0.31)p | (0.11)p | (0.18)p |
Consolidated unaudited statement of financial position
Note | As at 31.7.11 £'000 | As at 31.7.10 £'000 | As at 31.1.11 £'000 | |
Assets: | ||||
Non-current Assets | ||||
Investment in unquoted preference shares | 2 | 400 | 400 | 400 |
_____ | _____ | _____ | ||
400 | 400 | 400 | ||
Current Assets | ||||
Investments in quoted shares | 4 | 6 | 4 | |
Loans receivable | 3 | - | 97 | 80 |
Other receivables | 17 | 31 | 35 | |
Cash and cash equivalents | 7 | 3 | - | |
_____ | _____ | ____ | ||
28 | 137 | 119 | ||
Total Assets | 428 | 537 | 519 | |
Liabilities: | ||||
Current Liabilities | ||||
Trade and other payables | (37) | (91) | (31) | |
Non-current Liabilities | (86) | - | (73) | |
| ____ | ____ | ____ | |
Total Liabilities | (123) | (91) | 104) | |
Net Assets | 305 | 446 | 416 | |
Capital and Reserves | ||||
Called up equity share capital | 442 | 440 | 440 | |
Share premium account |
| 3,838 | 3,816 | 3,816 |
Retained earnings | (3,975) | (3,810) | (3,840) | |
____ | ____ | ____ | ||
Total Equity
| 305 | 446 | 416 |
Unaudited consolidated cash flow statement
| 6 months ended 31.7.11 £'000 | 6 months ended 31.7.10 £'000 | 12 months ended 31.1.11 £'000 | |
Reconciliation of operating profit to net cash flow from operating activities | ||||
Loss for the period / year before tax | (135) | (50) | (99) | |
Adjustments for: | ||||
Finance income | - | (7) | (12) | |
Impairment of investment | 93 | - | 1 | |
Change in receivables | (6) | 4 | (13) | |
Change in payables | 19 | 33 | 46 | |
___ | ___ | ___ | ||
Cash flows from operating activities | (29) | (20) | (77) | |
Interest received | - | 7 | 12 | |
Taxation refunded
| - | - | 19 | |
__ | __ | __ | ||
Net cash from operating activities |
| 7 | 31
| |
Investing activities | ||||
Loans repaid | 12 | - | 30 | |
___ | ___ | ___ | ||
Net cash used in investing activities | 12 |
| 30 | |
Financing activities | ||||
Issue of share capital | 24 | - | - | |
___ | ___ | ___ | ||
Net cash used in financing activities | 24 |
|
| |
Net (decrease) in cash and equivalents | 7 | (13) | (16) | |
Cash and equivalents at beginning of year |
| 16 | 16 | |
Cash and equivalents at end of year | 7 | 3 |
|
NOTES TO THE INTERIM ACCOUNTS
1. Loss per share
The basic and diluted loss per share for the period ended 31 July 2011 was 0.3p. The calculation of loss per share is based on the loss of £135,186 for the period ended 31 July 2011 and the weighted average number of shares in issue during the period of 44,016,700 (2010: 43,990,545).
2. Investment in unquoted preference shares
The investment in unquoted preference shares represents 400,000 £1 non-voting redeemable preference share held in Pinnacle Plus Limited ("Pinnacle"). The preference shares accrue interest at an annual rate of 7.0 per cent., payable on the date of redemption, with redemption being at Pinnacle's discretion at any time up to September 2013, upon which date they will be automatically redeemed.
3. Loans receivable
Loans receivable represented a short-term loan made by the Company in February 2009 of £200,000, £132,262 of which had been repaid as at 31 July 201, with the balance of £67,738 due for repayment by July 2012, together with interest due thereon of £25,508 ("Loan"). The directors now believe that this Loan is unlikely to be repaid in the short term, if at all, and have therefore provided for the Loan in full in the Group's results as at 31 July 2011.
4. Preparation of interim report
This report was approved by the Directors on 31 October 2011.
The Company's interim report for the period ended 31 July 2011 is available to view and download from the Company's website at www.creoncorporation.com.
For further information please contact:
Guus Berting, Creon Corporation +44 (0)20 7583 8302
Oliver Rigby, Daniel Stewart & Company Plc +44 (0)20 7776 6550
Toby Hall, GTH Communications +44 (0)20 3103 3900