ENGI.L Regulatory News (ENGI)

Energiser Investments plc Consolidated unaudited half-yearly financial report for the period ended 30June 2014 Interim Chairman's Statement I would start by stating that it is extremely sad that our Chairman, BillWeston, passed away in August 2014. Bill joined the Board as Chairman on 4December 2013 and during his short time with the Group he provided a great dealof support for its future direction. Bill's counsel, experience and support tothe Board and the Company will be missed. The Company is currently searchingfor Bill's replacement and will make an announcement at the appropriate time. Results I am pleased to report that the Group's net assets have increased by 414% from£136,000 to £699,000 since 30 June 2013. This increase is principally due tothe increase in the fair value of our investment in the development of 12 unitsunder construction at Kingswood Park, Surrey by £614,000. The Group, however,has made a loss before and after taxation of £120,000 (2013: £33,000) duringthe six months to 30 June 2014 predominantly due to the finance costs relatingto the funding for our investment in the development. This translates into aloss per share of 0.27p (2013: 0.08p) Our investment of residential propertiesin Wellingborough generated £48,000 (2013: £55,000) of net rental income.Administrative expenses were £35,000 (2013: £29,000). Interest payable on theGroup's borrowings has increased significantly to £141,000 (2013: £50,000) asthe investment in Kingswood Park is financed entirely by borrowings. Thedirectors do not recommend the payment of a dividend. The value of investment properties remains unchanged since the year ended 31December 2013. Trade and other receivables have increased from £15,000 to £2.5mas a result of our investment in the development at Kingswood Park Surrey. Inorder to finance this investment our short term borrowings have increased from£879,000 to £3.0m. At 30 June 2014, the Group's net assets amounted to £699,000(2013: £136,000) which equates to 1.60p (2013: 0.31p) per share. Operations Our residential investment portfolio of 20 properties in Wellingborough isfully let and generated gross rental income of £70,000 and after associatedoperating costs of £22,000, resulted in net rental income of £48,000. Theproperties are continuing to be let on short term tenancies whilst theresidential market is recovering. Consideration is currently being given to thedisposal of some of these properties with the proceeds being used to reducebank debt and reinvest proceeds retained by the Group into the Group's newactivity of providing mezzanine funding to small housebuilders. Construction of the 12 unit development at Kingswood Park, Surrey isprogressing well with a show house expected to be opened in early November2014. The Group is evaluating other proposals in the property sector. The Group continues to hold an investment in EiRx Therapeutics plc which hasbeen fully provided against. Outlook The residential property market has recovered significantly over the last twoyears and the Group is receiving new opportunities in this sector which shouldbegin to rebuild value for the shareholders. Nishith Malde Interim Chairman For further information contact: Energiser Investments plc Nishith Malde +44 (0) 1494 762450 Cairn Financial Advisers LLP Jo Turner +44 (0) 20 7148 7900 Group statement of comprehensive income Unaudited Unaudited Audited 6 months 6 months year to to 30 to 30 31 June 2014 June 2013 December 2013 Note £'000 £'000 £'000 Continuing operations Revenue arising in the course of ordinary 70 74 147activities Development costs - (18) (17) Cost of sales (20) (19) 66 Gross Profit 5 50 37 196 Administrative expenses 5 (35) (29) (73) Operating profit 15 8 123 Finance costs (141) (50) (102) Finance income 6 9 15 (Loss)/profit before taxation (120) (33) 36 Taxation - - - (Loss)/profit for the period attributable to (120) (33) 36shareholders of the Company Other comprehensive income - fair value 614 - -adjustment to the profit on mezzanine fundingarrangement Total comprehensive income 494 (33) 36 (Loss)/earnings per share Basic and diluted (loss)/earnings per share 4 (0.27)p (0.08)p 0.08pfrom total and continuing operations Diluted earnings per share is taken as equal to basic earnings per share as theGroup's average share price during the period is lower than the exercise priceand therefore the effect of including share options is anti-dilutive. Group statement of financial position Unaudited Unaudited Audited as at 30 as at 30 as at 31 June 2014 June 2013 December 2013 Note £'000 £'000 £'000 ASSETS Non-current assets Investment property 6 2,666 - 2,666 Financial assets at fair value through profit 1 1 1and loss 2,667 1 2,667 Current assets Inventories - 2,567 - Trade and other receivables 2,517 15 1,415 Cash and cash equivalents 196 4 10 2,713 2,586 1,425 Total assets 5,380 2,587 4,092 LIABILITIES Current liabilities Trade and other payables 477 327 359 Short term borrowings 3,013 879 2,311 3,490 1,206 2,670 Non-current liabilities Long term borrowings 1,180 1,221 1,200 Financial liabilities held at fair value 11 24 17through profit or loss 1,191 1,245 1,217 Total liabilities 4,681 2,451 3,887 Net assets 699 136 205 EQUITY Share capital 2,312 2,312 2,312 Share premium account 5,747 5,747 5,747 Convertible loan 88 88 88 Merger reserve 1,012 1,012 1,012 Revaluation reserve 614 - - Retained earnings (9,074) (9,023) (8,954) Total equity 699 136 205 Group statement of changes in equity Share Share premium Convertible Merger Revaluation Retained Total capital account loan reserve reserve earnings equity £'000 £'000 £'000 £'000 £'000 £'000 £'000 Balance at 1 2,312 5,747 88 1,012 - (8,990) 169January 2013 Total comprehensive - - - - - (33) (33)income Balance at 30 June 2,312 5,747 88 1,012 - (9,023) 1362013 Total comprehensive - - - - - 69 69income Balance at 31 2,312 5,747 88 1,012 - (8,954) 205December 2013 Fair value - - - - 614 - 614adjustment toprofit on mezzaninefunding arrangement Total comprehensive - - - - - (120) (120)income Balance at 30 June 2,312 5,747 88 1,012 614 (9,074) 6992014 Group statement of cash flows Unaudited Unaudited Audited 6 months 6 months year to to 30 to 30 31 June 2014 June 2013 December 2013 £'000 £'000 £'000 Cash flows from operating activities (Loss)/profit before and after taxation (120) (33) 36 Adjustments for: Interest expense 141 50 102 Fair value adjustment on financial liabilities (6) - (15)recognised in profit or loss Changes in working capital: - Increase in trade and other receivables - (1) (1) - Increase/(decrease) in trade payables 14 (34) (23) - Reversal of impairment in inventories - - (100) Net cash generated by/(used in) operating 29 (18) (1)activities Cash flows from investing activities Mezzanine finance facility issued (488) - (1,400) Used in investing activities (488) - (1,400) Cash flows from financing activities Proceeds from borrowings 707 64 1,496 Re-payment of borrowings (25) (18) (39) Interest paid (37) (31) (53) Net cash generated by financing activities 645 15 1,404 Net increase/(decrease)/increase in cash and cash 186 (3) 3equivalents Cash and cash equivalents at beginning of period 10 7 7 Cash and cash equivalents at end of period 196 4 10 1. Nature of operations and general information The principal activity of the Group is as an investment company investing inquoted and unquoted companies to achieve capital growth. The Group also holds aproperty development acquired by way of its principal activity. The propertiesare held for sale with rental income arising from short term lets. Energiser Investments plc is the Group's ultimate parent company. It isincorporated and domiciled in Great Britain. The address of EnergiserInvestments plc's registered office, which is also its principal place ofbusiness, is 417 Finchley Road, London, NW3 6HJ. Energiser Investments plc's shares are quoted on AIM, a market operated by theLondon Stock Exchange. The consolidated half-yearly financial report has beenapproved for issue by the Board of Directors on 30 September 2014. The financial information set out in this half-yearly financial report does notconstitute statutory accounts as defined in Sections 434(3) and 435(3) of theCompanies Act 2006. The Group's statutory financial statements for the yearended 31 December 2013 have been filed with the Registrar of Companies and areavailable at www.energiserinvestments.co.uk. The auditor's report on thosefinancial statements was unqualified and did not contain any statement underSection 498(2) or Section 498(3) of the Companies Act 2006. 2. Basis of preparation This consolidated half-yearly financial report has been prepared in accordancewith International Accounting Standard 34 - Interim Financial Reporting. The consolidated half-yearly financial report should be read in conjunctionwith the annual financial statements for the year ended 31 December 2013, whichhave been prepared in accordance with IFRS as adopted by the European Union. 3. Accounting policies The accounting policies applied are consistent with those of the annualfinancial statements for the year ended 31 December 2013, as described in thosefinancial statements other than that stated below: Critical judgements in applying the accounting policies Key sources of estimation uncertainty Fair value of profit on mezzanine funding arrangement The fair value of the mezzanine funding arrangement includes estimates as tothe timing and value of future cash flows and the underlying profitability ofthe development. The estimates are formed based on information provided by thedeveloper. The group believes that the directors' knowledge and experience inthe sector means they are well placed to critically assess this information andto make conclusions as appropriate. 4. Loss per ordinary share The loss per ordinary share is based on the weighted average number of ordinaryshares in issue during the period of 43,787,956 ordinary shares of 0.1p (2013:43,787,956 ordinary shares of 0.1p) and the following figures: Unaudited Unaudited Audited 6 months 6 months year to to 30 to 30 31 June 2014 June 2013 December 2013 (Loss)/profit attributable to equity shareholders £ (120) (33) 36'000 (Loss)/earnings per ordinary share (0.27)p (0.08)p 0.08p Diluted earnings per share is taken as equal to basic earnings per share as theGroup's average share price during the period is lower than the exercise priceand therefore the effect of including share options is anti-dilutive. 5. Income and segmental analysis Unaudited Unaudited Audited 6 months 6 months year to 31 to 30 to 30 December June 2014 June 2013 2013 £'000 £'000 £'000 Segment result Investment activities: Development costs - (18) (17) Administrative expenses (33) (29) (71) (33) (47) (88) Rental activities: Net Rental income 50 55 113 Administrative expenses (2) - (2) 48 55 111 Other: Reversal of impairment of inventories - - 100 - - 100 Operating profit 15 8 123 Finance costs (141) (50) (102) Fair value adjustment on interest rate swap 6 9 15 Loss before tax (120) (33) 36 Unaudited Unaudited Audited as as at 30 as at 30 at 31 June 2014 June 2013 December 2013 £'000 £'000 £'000 Segment assets Investment activities: Non-current assets 1 1 1 Current assets 12 11 8 13 12 9 Rental: Current assets - inventories - 2,567 - Non - current assets - investment property 2,666 - 2,666 Current assets - other 5 8 17 2,671 2,575 2,683 Other: Current asset - fair value of profit on 614 - -mezzanine funding arrangement Current assets - other loan 1,888 - 1,400 Current assets - other 194 - - 2,696 - 1,400 Total assets 5,380 2,587 4,092 Segment liabilities Investment activities: Current liabilities 959 859 905 959 859 905 Rental: Current liabilities 456 347 365 Non-current liabilities 1,191 1,245 1,217 1,647 1,592 1,582 Other: Current assets - other loan 2,075 - 1,400 2,075 - 1,400 Total liabilities 4,681 2,451 3,887 Total assets less total liabilities 699 136 205 The activity of both the investments and rentals arose wholly in the UnitedKingdom. No single customer accounts for more than 10% of revenue. 6. Investment property Investment Property £000 Cost or fair value At 1 July 2013 - Transfer from inventories 2,666 At 31 December 2013 2,666 Fair value adjustment - At 30 June 2014 2,666