Digitalbox Regulatory News (DBOX)

8 Mar 2006 07:00

PLUS MARKETS GROUP PLCPRELIMINARY RESULTS FOR THE YEAR ENDED 31 DECEMBER 2005PLUS Markets Group plc, reports its preliminary results for the year ended 31December 2005.KEY POINTS * Successful share placing in September raising GBP2.5m gross of expenses, to fund the development of the PLUS service; * The PLUS service opened on time and within budget; * Turnover at GBP1.45 million, excluding one-off income of GBP0.16 million, 13% up on the previous year (2004: GBP1.14 million); * Operating loss of GBP1.15 million (2004: GBP1.32 million). This result included GBP0.92 million of expenditure on the new PLUS service, GBP0.58 million of which was in respect of one-off development spend; * There were 154 issuers on the primary market at year end, 15% up on the previous year (2004:134).For further information please contact:Rostron Parry - John Parry: 020 7490 8062CHAIRMAN'S STATEMENTThis has been a busy and exciting year for PLUS Markets Group plc. We turnedaround our primary market and launched our new trading service, the PLUSservice ("PLUS"). As discussed in the Financial Review, underlying operatinglosses, excluding the one-off PLUS development spend, fell considerably.Expenditure on the PLUS service necessarily precedes revenue and this will bemost noticeable in the first half of the current year. Our cash positionremains strong.PLUS is a new equity trading service, based on a quote-driven system, providingan alternative execution venue for securities with a listing or quotationelsewhere in London. PLUS was created in response to demand from brokers andwas developed, financed and opened within twelve months from date of inception.It would not have been possible to launch PLUS within such a tight time framewere it not for the goodwill and advice of so many market practitioners. Weare grateful for their time and support.Nothing better illustrates the changes in our business than the growth in therange and types of security that we trade. Following the launch of PLUS, we arenow trading over 750 securities with a combined market capitalisation in excessof GBP65 billion. This compares with fewer than 140 securities a year ago witha market capitalisation of less than GBP1.4 billion.I am delighted to report that since its launch, on 5 December, the PLUS servicehas progressed well. Almost all key information vendors are already carryingPLUS data. To date, 12 brokers and 5 market makers have joined PLUS with moreexpected over the coming months. This week, we were pleased to welcome ourinitial AIM companies to the PLUS service. PLUS is currently the onlyalternative trading system in the United Kingdom to trade AIM securities. We have seen the number of bargains growing steadily since PLUS was launched.Already, PLUS has gained significant market share in certain industry segmentssuch as the FTSE Fledgling Index. Indeed, in some officially listed securities,we have captured the majority of trading activity. This is a remarkableachievement in an industry, which has traditionally been dominated by a singlemarket operator.Most importantly, though, are the prices at which transactions are beingexecuted on our platform. Here the PLUS service is proving itself highlycompetitive. Brokers are accessing PLUS to ensure that they are offering theirclients the best prices available across the UK equity markets, especially aswe prepare to adjust our normal market sizes and offer increased liquidity. We believe that PLUS Markets is well positioned to operate within the modernregulatory environment established by MiFID, a pan-European framework forcompetition, innovation and diversity in financial markets. We will monitor theevolution of MiFID and actively engage with market participants during thisprocess, to enable us to provide trading and transparency solutions whichcontinue to meet the needs of our customers.Following our programme of reforms in the first half of the year, we have seena turnaround in the performance of Ofex, our primary market. Thus, for thefirst time in five years, there has been an increase in the number of companiesbeing admitted. This is because there is a growing recognition of theattractiveness of a disclosure based market, which properly balances the needsof companies and their investors.We are pleased that the launch of the PLUS service has had tangible benefitsfor companies with an existing quotation on our primary market. As more marketparticipants focus on PLUS, we have seen an increased profile for many of ourexisting companies and significantly increased trading volumes on the newplatform.Moving forwards, it is our intention to operate our primary market under thePLUS brand thereby giving a unified identity with your holding company and thenew successful trading service. We have achieved much in an extremely busy year due to the drive of ourdedicated and highly professional staff. May I also take this opportunity towelcome to the Board two further Non Executive Directors, Stephen Allcock Q.C.and Nicholas Smith.Brokers want the ability to access a different pool of liquidity. PLUS is notonly providing choice but competitive prices and volumes in a range ofsecurities. It is this which gives us great confidence in the future. Stephen Hazell-SmithChairman7 March 2006OPERATIONAL AND FINANCIAL REVIEWOPERATIONAL REVIEWThe year under review saw significant operational activity, including aprogramme of improvements to the Ofex Primary Market, the commencement of thePLUS service and the launch of Newstrack PLUS, a fast, effective and securemechanism for companies and their advisers to submit news announcements.As part of its overall operational activity the Company has further enhancedits disaster recovery capability and now has a full business continuity plan inplace, with the hosting and the recovery site being provided by a market leaderin this field. The Company also strengthened its headcount resources in theareas of regulation and technology in line with the requirements of the PLUSservice.FINANCIAL REVIEWTURNOVERTurnover at GBP1.45 million (2004: GBP1.14million) was 27% up on the previousyear, primarily as a result of the 44 new admissions to the Ofex market, being24 higher than in 2004 and the one-off income of GBP0.16 million generated fromthe enhanced trading services, as previously disclosed in the interim results.Companies leaving the market reduced significantly, with 24 leavers (2004: 44)and the number of issuers on the market at the end of 2005 stood at 154 (2004:134), the first year on year increase since 2000.EXPENDITURETotal expenditure of GBP2.70 million (2004: GBP2.46 million) includedexpenditure of GBP0.92 million on the PLUS service, GBP0.58 million of whichwas in respect of one-off development spend.LOSS FOR THE YEARThe loss for the year was GBP1.15 million (2004: GBP1.32 million), with a lossper share at 1.19p (2004: 4.17p). Excluding the one-off PLUS servicedevelopment expenditure of GBP0.58 million and income of GBP0.16 million, theunderlying operating loss comprised GBP0.34 million in respect of the PLUSservice and GBP0.39 million in respect of the existing Ofex Primary Marketbusiness. The second half loss of GBP0.13 million on the Primary Market servicewas an improvement on the GBP0.26 million loss reported in the interim resultsfor the same part of the business.BALANCE SHEET AND CASH FLOWFollowing the placing of 50,000,000 new ordinary shares at 5p each in September2005 to finance the development of the Company's trading services as previouslydetailed, the cash position increased by GBP1.10 million in the year (2004:GBP2.28 million). Shareholders' funds at the year end stood at GBP3.73 million (2004: GBP2.35million).Darren FrancisChief Financial Officer7 March 2006PLUS MARKETS GROUP PLCPRELIMINARY RESULTS FOR THE YEAR ENDED 31 DECEMBER 2005CONSOLIDATED PROFIT AND LOSS ACCOUNTFOR THE YEAR ENDED 31 DECEMBER 2005 2005 2004 AUDITED AUDITED GBP GBP TURNOVER 1,446,458 1,140,734 Administrative expenses (2,697,172) (2,462,190) __________ __________ OPERATING LOSS (1,250,714) (1,321,456) Interest receivable 97,866 20,514 Interest payable - (20,130) _________ __________ LOSS ON ORDINARY ACTIVITIES BEFORE TAXATION (1,152,848) (1,321,072) Tax on loss on ordinary activities - - _________ __________ LOSS ON ORDINARY ACTIVITIES AFTER TAXATION AND RETAINED LOSS FOR THE YEAR (1,152,848) (1,321,072) _________ _________ _________ _________ Basic and diluted loss per share (1.19)p (4.17)p _________ _________ _________ _________PLUS MARKETS GROUP PLCPRELIMINARY RESULTS FOR THE YEAR ENDED 31 DECEMBER 2005CONSOLIDATED BALANCE SHEETAS AT 31 DECEMBER 2005 2005 2004 AUDITED AUDITED GBP GBP FIXED ASSETS Intangible assets 500,000 500,000 Tangible assets 442,197 245,705 Investments 929 929 _______ _______ 943,126 746,634 CURRENT ASSETS Debtors and prepayments 600,132 520,540 Accrued income 1,806 1,806 Cash at bank and in hand 3,448,982 2,351,846 _________ _________ 4,050,920 2,874,192 CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR Creditors and accruals (399,782) (667,403) Deferred income (861,324) (606,730) _________ _________ (1,261,106) (1,274,133) _________ _________ NET CURRENT ASSETS 2,789,814 1,600,059 _________ _________ TOTAL ASSETS 3,732,940 2,346,693 _________ _________ _________ _________ CAPITAL AND RESERVES Called up share capital 6,726,635 4,226,635 Share premium 1,508,274 1,469,179 Profit and loss account (4,501,969) (3,349,121) _________ _________ EQUITY SHAREHOLDERS' FUNDS 3,732,940 2,346,693 _________ _________ _________ _________PLUS MARKETS GROUP PLCPRELIMINARY RESULTS FOR THE YEAR ENDED 31 DECEMBER 2005CONSOLIDATED CASH FLOW STATEMENTFOR THE YEAR ENDED 31 DECEMBER 2005 2005 2004 AUDITED AUDITED GBP GBP NET CASH OUTFLOW FROM OPERATING ACTIVITIES (1,176,136) (948,383) RETURNS ON INVESTMENTS AND SERVICING OF FINANCE Interest received 97,866 20,514 Interest paid - (20,130) _________ _______ NET CASH INFLOW/(OUTFLOW) FROM RETURNS ON INVESTMENTS AND SERVICING OF FINANCE 97,866 384 _________ _______ CAPITAL EXPENDITURE Payments to acquire tangible fixed assets (366,022) (274,159) Rental Deposit / Cash Cover relating to loan financing 169,000 (204,250) ________ _______ NET CASH OUTFLOW FROM CAPITAL EXPENDITURE (197,022) (478,409) ________ _______ FINANCING Net issue of ordinary share capital 2,469,715 3,655,850 VAT rebate on share admission expenses 69,380 - Net financing with related party - J P Jenkins Limited - (118,555) Net loan financing (166,667) 166,667 _________ _________ NET CASH INFLOW FROM FINANCING 2,372,428 3,703,962 _________ _________ INCREASE IN CASH 1,097,136 2,277,554 _________ _________ _________ _________The financial information contained in this preliminary report does notconstitute the Group's statutory accounts within the meaning of Section 240 ofthe Companies Act 1985. The financial statements for 2005 have been audited andwill be delivered to the Registrar of Companies following the annual generalmeeting. The auditors have reported on the 2005 statements; their report wasunqualified and did not contain a statement under section 237(2) or (3) of theCompanies Act 1985.A copy of the Group's statutory accounts for 2005 will be mailed toshareholders shortly and will also be available for collection from the Group'sregistered office.ENDPLUS Markets Group plc