Craven House Capital Regulatory News (CRV)

19 Mar 2009 15:48

The following amendment has been made to Trading Update released on 19 March 2009 at 11.45am under RNS no 1368P. The word 'revenues' in paragraph four has been replaced by the word 'profits'. All other details remain unchanged. The full amended text is shown below: 

MEDSEA ESTATES GROUP PLC

('the Company' or "Medsea")

Trading Update

Further to the trading update made in the Interim Results of the Company (released on 30 September 2008) and the announcement of 10 November 2008, the board of directors of Medsea provides the market with the following update on trading and the position of the Company:

The Company had unaudited sales in the region of £10.8m and unaudited losses in the region of £147,000 for the year ended 31 December 2008. Cash balances as at 31 December 2008 stood at circa £26,000. Cash balances as of 17 March 2009 reduced to circa £10,000.

The first quarter of 2009 has seen continued pressure on collecting commissions due to the adverse market conditions being felt globally. However, the key objective of trading at a level which enables the Company to almost break even is currently being met. New commissions continue to be generated and these are at such a level as to sustain the Company in meeting its current financial obligations. However, it is essential that receivables collection is maintained over the coming months if the Company is to remain viable as a going concern. 

Approximately sixty per cent. of the Company's revenues in 2008 were attributable to sales in Italy. However, commissions in relation to these Italian sales have been disputed and withheld by certain Italian promoters who Medsea sold properties on behalf of. The Company is seeking legal recourse through the Italian courts and although the directors believe there is a reasonable probability of success in recovering the outstanding commissions the process could take years and if unsuccessful the Company would have to write down approximately £2m of its 2008 profits.

The Company is continuing to discuss with various third parties potential transactions which could increase shareholder value. However, it should be noted that at present all such discussions remain in an early stage. If these discussions fail to bear fruit the Company will proceed with its original plan to delist from AIM. Shareholders will be notified of developments as they occur. 

Tony Gatehouse, Chairman of Medsea commented: "This is a difficult period for Medsea, however, I am pleased that our programme of downsizing has meant that we are able to continue to trade and that sales are generating enough revenues to just cover our costs. I continue to believe that if Medsea can survive this time of difficult trading we will be in a strong position to capitalise on any upturn in market sentiment. However, I am aware that the next few months will be key to the survival of Medsea and as such, as a board we continue to court interest from third parties who may be capable of realising shareholder value on a shorter timescale."

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