12 Dec 2008 07:00
To be released on 12 December 2008 Sterling Green Group Plc ("Sterling Green" or "the Group") Interim Results for the six month period ended 30 September 2008 Chairman's StatementIntroduction
I am pleased to present the Group's interim results for the six month period ended 30 September 2008.
Results and dividends
The Group generated an unaudited loss before and after taxation for the six month period of ‚£365,000 (six months to 30 September 2007 - ‚£756,000 loss) on revenues of ‚£931,000 (six months to 30 September 2007 - ‚£467,000).
In the first quarter of the new financial year it was evident that certain of the Group's operations required streamlining as a result of prevailing market conditions, in particular the well-publicised problems encountered in the mortgage industry. The ensuing cost-cutting process significantly improved the efficiency of the Group and, as a result, the loss generated in the second quarter of the current financial year was significantly less than that of the first quarter. Moreover, trading in the period since 30 September 2008 has, at an operating profit level, been broadly breakeven, although historically December and January have been the Group's weakest trading months, which is reflected in the Group's budget.
In September 2008 the Group replaced its bank overdraft facility with a ‚£ 250,000 loan facility with a third party at an interest rate of 18 per cent. per annum and as at 30 September 2008 the Group had drawn down ‚£200,000 of this loan. The balance of the loan was drawn down recently and the majority of these monies remain available for the Group's working capital requirements. The Directors still consider that this loan facility will be sufficient for the Group's short term working capital requirements, although given the high interest rate that has been applied to this loan the board are actively looking to refinance it in the short term. However, should the trading performance of the Group during the next six months be consistently lower than management's expectations, the Group is likely to require further funds.
The Directors do not recommend the payment of a dividend.
Outlook
The Directors have been actively looking to add to the Group's existing revenue streams. It is, however, too early in this process to be able to accurately assess the potential levels of income that could be generated from these sources and the possible impact on the Group's profitability.
The Group is currently constrained by its working capital position but is managing its available resources in order to take advantage of its reduced cost base and significant market opportunity.
The Directors consider that the downturn in economic activity is now adversely affecting the financial circumstances of an increasing number of members of the public and although this is bad news for the UK economy and the individuals and families concerned, it is a time when the service offered by our Group should be available to assist a growing number of additional clients in dealing with their financial problems.
Michael EdelsonChairman12 December 2008Enquiries:Sterling Green Group plc Tel: 0161 975 5757Michael Edelson John East & Partners Limited Tel: 020 7628 2200Simon Clements/David Worlidge
Consolidated Income Statement
For the six month period ended 30 September 2008
Six months e Six months 15 months nded 30 ended 30 ended 31 September September March 2008 2007 2008 (Unaudited) (Unaudited) (Audited) ‚£000 ‚£000 ‚£000 Revenue 931 467 1,309 Cost of sales (616) (502) (1,423) Gross profit/(loss) 315 (35) (114) Administrative expenses (667) (724) (1,538) Loss from operations (352) (759) (1,652) Finance income 4 11 24 Finance costs (17) (8) (20) Loss on ordinary activities before (365) (756) (1,648)taxation Income tax expense - - - Loss on ordinary activities after (365) (756) (1,648)taxation Loss per share - basic and diluted (0.13p) (0.31p) (0.70p)
STATEMENT OF CHANGES IN TOTAL EQUITY
FOR THE SIX MONTH PERIOD ENDED 30 SEPTEMBER 2008
Six months Six months 15 months ended 30 ended 30 ended 31 September September March 2008 2007 2008 (Unaudited) (Unaudited) (Audited) ‚£000 ‚£000 ‚£000 Total equity at the beginning of the 972 931 16period Loss for the period (365) (756) (1,648) Issue of share capital 200 1,013 2,763 Costs of share issue - (63) (159) Total equity at the end of the period 807 1,125 972CONSOLIDATED BALANCE SHEETAS AT 30 SEPTEMBER 2008 As at 30 As at As at September 2008 30 September 31 March (Unaudited) 2007 (Unaudited) 2008 (Audited) ‚£000 ‚£000 ‚£000 Non-current assets Goodwill 1,115 1,078 1,115 Property, plant and equipment 258 351 309 Total non-current assets 1,373 1,429 1,424 Current assets Trade and other receivables 89 199 141 Cash and cash equivalents 102 147 180 Total current assets 191 346 321 Current liabilities Trade and other payables (342) (350) (318) Current tax liabilities (18) (18) (18) Borrowings (86) (86) (284) Total current liabilities (446) (454) (620) Net current liabilities (255) (108) (299) Non-current liabilities Borrowings (311) (196) (153) Total non-current liabilities (311) (196) (153) Net assets 807 1,125 972 Equity Share capital 288 250 280 Share premium account 1,710 834 1,518 Capital reserve 6 6 6 Other reserves 891 891 891 Retained losses (2,088) (856) (1,723) Total equity 807 1,125 972
CONSOLIDATED CASH FLOW STATEMENT
FOR THE SIX MONTH PERIOD ENDED 30 SEPTEMBER 2008
Six months Six months 15 months ended 30 ended 30 ended 31 September September March 2008 2007 2008 (Unaudited) (Unaudited) (Audited) ‚£000 ‚£000 ‚£000 Cash flows from operating activities Loss before tax (365) (756) (1,648) Adjustments for: Depreciation of property, plant and 52 49 113equipment Decrease/(Increase) in trade and other 52 (39) (46)receivables Increase in trade and other payables 24 89 88 Finance income (4) (11) (24) Finance costs 17 8 20
Net cash used in operating activities (224) (660) (1,497)
Cash flow from investing activities Acquisition of subsidiary, net of cash - (29) (29)acquired Purchase of property, plant and (1) (59) (82)equipment Finance income 4 11 24 Net cash from/(used in) investing 3 (77) (87)activities Cash flow from financing activities Capital element of finance lease (42) (25) (68)payments Issue of ordinary share capital, net 200 (61) 1,593of costs Proceeds from new loans 200 - - Finance costs (17) (8) (20) Net cash from/(used in) financing 341 (94) 1,505activities Net increase/(decrease) in cash and 120 (831) (79)cash equivalents Cash and cash equivalents at beginning (18) 978 61of period Cash and cash equivalents at end of 102 147 (18)period
NOTES TO THE INTERIM REPORT
FOR THE SIX MONTH PERIOD ENDED 30 SEPTEMBER 2008
1. The interim financial statements have not been audited and they do not
constitute full financial statements within the meaning of s240 of the Companies Act 1985. The statutory accounts for the period ended 31 March 2008 have been delivered to the Registrar of Companies. The auditors' opinion on those accounts was unqualified and did not contain a statement under s237(2) or s237(3) of the Companies Act 1985.
2. The next accounting reference date will be 31 March 2009 and financial
statements for this period will be prepared in accordance with International Financial Reporting Standards (IFRS) as required by European Law. The interim financial statements have been prepared in accordance with accounting policies that are expected to apply to the financial statements for the year ending 31 March 2009.
3. Basic loss per share has been calculated using a loss for the period of ‚£
365,000 (‚£756,000 loss for the six month period ended 30 September 2007 and ‚£ 1,648,000 loss for the 15 month period ended 31 March 2008) and a weighted average number of ordinary shares in issue during the six month period ended 30 September 2008 of 287,844,242 (240,486,537 for the six month period ended 30 September 2007 and 235,986,036 for the 15 month period ended 31 March 2008). Diluted loss per share is calculated by adjusting the weighted average number of ordinary shares in issue assuming conversion of all dilutive potential ordinary shares. The Company's potential ordinary shares consist of share options and deferred consideration shares. Due to the loss in the current and comparative periods there are no dilutive ordinary shares.
5. Copies of the Interim Report can be obtained by writing to The Company
Secretary, Sterling Green Group plc, Number 14, The Embankment, Vale Road,
Heaton Mersey, Stockport, Cheshire SK4 3GN. Alternatively, copies can also be
downloaded from the Company's website which is www.sterlinggreen.co.uk.
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