Gb Group Regulatory News (GBG)

27 Nov 2007 07:00

GB Group PLC27 November 2007 Embargoed until 7.00 a.m. 27 November 2007 GB GROUP PLC ("GB" or the "Group") Interim Results for the Six Months Ended 30 September 2007 Highlights • The Group is expected to generate profits for the remainder of the financial year to 31 March 2008. • Group revenue increased by 13% to £7.9 million (2006: £7.0 million). • DataAuthentication revenues increased to £2.8 million (2006: £2.5 million). • Number of individual transaction searches in DataAuthentication (excluding one-off batch verifications) increased to 2.2 million during the period (2006: 1.6 million). • Combined revenue from DataIntegrity and DataSolutions was £5.1 million (2006: £4.6 million). • Group loss before tax in the six months to 30 September 2007 was significantly less than expected at £1.0 million (2006: £0.6 million). • Cash balances were £3.6 million at 30 October 2007 and the Group expects to generate cash for the remainder of the year. • During October, the rate of growth increased across the Group. • URU currently has 202 clients compared to 174 in May 2007 and transaction searches were 32% higher than the monthly average from the previous quarter. John Walker-Haworth, Chairman, commented: "GB continues to provide market leading products and services in each area ofits business. The Group delivered improved revenue growth during the first halfof the year and your Board is very positive about prospects." - Ends - For further information, please contact: GB Group plc 01244 657333Richard Law, Chief Executive Mona Navin-Mealey, Finance Director Weber Shandwick Financial 020 7067 0700Richard Hews/ Alex Brown Website www.gb.co.uk Notes to Editors About GB Group plc GB Group plc provides a range of products and services to enable organisationsto capitalise on one of their greatest assets - customer data. The Company hasexpertise across a range of sectors and is able to transform customer data intovaluable information, enabling clients to make better, more informed decisions. The development of innovative software and services, through to the provision ofthe UK's most comprehensive consumer business databases - The National Register(R) and the National Authentication Register - positions GB Group as a widelyacknowledged industry leader in its specialist markets. We are constantly improving business processes by building on our core values ofInnovation, Quality and Excellence. This is reflected in our customersatisfaction surveys and also through research, carried out by ManchesterBusiness School, which confirms our products are out-performing the competition. GB Group plc has three complementary offerings: • DataAuthentication helps businesses validate personal identity information and provides anti-fraud solutions to fight crime. • DataIntegrity helps companies capture and maintain accurate customer contact data, an essential foundation for any profitable customer relationship. • DataSolutions empowers companies to consolidate and analyse customer data from various sources, enabling them to make better, more informed decisions. Established since 1989, GB's core competencies combined with industry sectorknowledge have enabled the company to deliver significant value to organisationssuch as Standard Life, Scottish Power and TD Waterhouse in helping them derivemaximum value from their customer data and sustain real advantage over theircompetition. GB Group is supported by its key relationships with major organisations withwhom it works with on major initiatives (an example being British Telecom),together with a team of highly talented and motivated staff successfullydelivering business solutions. GB Group plc is listed on the London Stock Exchange (www.gb.co.uk). About URU(TM) URU is an online identity verification service which was developed jointly withBT and is DataAuthentication's principle offering. URU, which is powered by GB'sID3(TM)search engine and decision making technology, provides access to GB'scomprehensive range of identity data and BT's high capacity web delivery. Ithelps organisations to protect themselves from the growing problem of identitytheft and fraud, which is estimated to cost the UK economy over £1.7 billion perannum. URU enables companies subscribing to the service to make an instantdecision whether to accept the identity claimed by any given individual andconfirm their age in seconds. URU works by cross checking personal information provided by an individual atthe point of acquisition against a comprehensive range of datasources to confirmthat an individual is who they claim to be, live where they claim to live andmeet certain minimum legal age requirements. No personal data is disclosed by the reference databases and as a result URU iscompliant with the Data Protection Act. URU also provides a valuable audit trail demonstrating that the necessary checkshave taken place, thereby helping companies comply with legislation, includingthe 2nd European Money Laundering Directive, Proceeds of Crime Act and MinimumLegal Age requirements of certain industry sectors. The addition of data from CallCredit also enables users of URU to incorporatecredit reference data. As a result of legislation, new opportunities and social responsibilityrequirements, the market for online ID verification is significant and growing.Although an estimated 0.5 billion manual ID checks are conducted annually in theUK, less than 3% of these are currently performed electronically. URU has demonstrated that online checks are more effective, less expensive andmore robust. The market is moving towards online checks as fraudulent documents become evermore sophisticated, more readily available and more difficult to check manually.It is estimated that by 2010, the market for online ID checks could be 300million checks per annum. GB works closely with trade and industry associations, such as the Finance andLeasing Association, the Remote Gambling Association and the FinancialTechnology Research Centre, to advise businesses that more robust processes canprevent financial crime. We have worked closely with the Gaming Industry toaddress social issues such as underage gambling and addiction and our SocialResponsibility Consultancy helps Gaming operators formulate best practice tocomply with regulatory requirements and improve profitability. About ID3-Check ID3-Check is an international online identity verification service developed byGB's DataAuthentication business. It is a hybrid international version of thetechnology underpinning URU, GB's joint project with BT which is now the UK'sleading online age and identity verification service. The service helps organisations to protect themselves from the growing globalproblem of identity theft and fraud. ID3-Check enables organisations subscribingto the service to make an instant decision whether to accept the identityclaimed by an individual and confirm their age in seconds. ID3-Check can confirmthe age and identity of nearly half a billion people in 21 countries includingAustralia, Canada, the USA and most Western European countries. ID3-Check works by cross checking personal information provided by an individualat the point of acquisition against a comprehensive range of data sources toconfirm that an individual is who they claim to be, live where they claim tolive and meet certain minimum legal age requirements. No personal data is disclosed by the reference databases and as a resultID3-Check is compliant with Data Protection laws. ID3-Check also provides a valuable audit trail demonstrating that the necessarychecks have taken place, thereby helping companies comply with legislation,including the 2nd European Money Laundering Directive, Proceeds of Crime Act andMinimum Legal Age requirements of certain industry sectors. As a result of legislation, new opportunities and social responsibilityrequirements, the market for online ID verification across borders issignificant and growing. CHAIRMAN'S STATEMENT Overview GB's results for the six months ending 30 September 2007 were in line with theexpectations set out in the trading update issued on 11 October 2007. All of GB's business areas delivered improved revenue growth during the firsthalf of the year. The growth rate across all business areas has continued intothe second half of the year and, as a result, the Group is expected to tradeprofitably for the remainder of the year to 31 March 2008. Cash balances at 31st October were £3.6 million. In line with the current moveto profitability the Group is expected to generate cash from its operations inthe period up to the end of the financial year. More than 50% of the Group's revenue now comes from online services which offersignificant revenue potential for the future. As GB moves into profitability,your Board is very positive about prospects for the Group. Trading During the first half of the year, Group revenue increased by 13% to £7.9million (2006: £7.0 million) and gross profit also improved. This trend hascontinued in the second half to date with revenue for the current year to theend of October approximately 17% ahead of the same period last year. Group losses before taxation for the six-month period to 30 September 2007 were£1.0 million (2006: £0.6 million). Overheads in the first half increased to fund greater sales marketing andtechnical infrastructure. The build up of resources to support the growth to thenext stage has now ended and overheads are not expected to increasesignificantly further in the second half of the year. DataAuthentication Revenue in DataAuthentication during the first half of the year was £2.8 million(2006: £2.5 million). As indicated in the October trading update, revenue growth in this area of thebusiness was slower than earlier expectations as a result of a slower movementof the market towards electronic methods of age and identity verification bothin the UK and internationally. The Directors believe that this movement,although delayed, will occur and that the market for electronic age and identitysolutions continues to represent a substantial opportunity for the Group. Despite slower development of the market GB has maintained its lead and has seenrevenue growth from both its UK service, URU, and its international ID3solution, accelerate in recent months. The number of individual transaction searches (excluding one-off batchverifications) through URU, GB's joint service with BT, increased to 2.2 millionfor the six months to 30 September 2007 compared to 1.6 million in thecorresponding period last year. During October, individual transactionsincreased by approximately 32% compared to the monthly average during theprevious quarter. The number of URU clients also increased and now totals 202(31 May 2007: 174). ID3 clients now number 13 (31 May 2007: 4). DataIntegrity and DataSolutions Combined revenue from the DataIntegrity and DataSolutions business areas wasahead of earlier expectations during the six months to 30 September at £5.1million (2006: £4.5 million) and was 11% higher than the same period last year. The decision to invest in the online delivery of a number of GB's services inthese business areas, together with providing up-to-date data, has opened up arange of new business opportunities within large enterprises and in the fieldsof criminal justice, counter-terrorism and debt recovery. As a result of the potential opportunities created by new product development,the prospects for these business areas have been greatly improved and trading inthe past two months has continued to improve. JL Walker-HaworthChairman 27 November 2007 CONSOLIDATED INCOME STATEMENT For the six months ended 30 September 2007---------------------------------------------------------------------------------- Note Unaudited Unaudited Audited 6 months to 6 months to Year to 30 September 30 September 31 March 2007 2006 2007 £'000 £'000 £'000 Revenue 7,915 7,032 14,952 Cost of sales (4,122) (3,763) (7,617) ------------ ------------ ------------ Gross profit 3,793 3,269 7,335 Other operating expenses (4,905) (4,059) (8,754) Exceptional items - - (100) ------------ ------------ ------------ Operating loss (1,112) (790) (1,519) Finance revenue 136 153 294 ------------ ------------ ------------ Loss before tax (976) (637) (1,225) Income tax expense - - (16) ------------ ------------ ------------ Loss for the period attributableto equity holders of the parent (976) (637) (1,241) ------------ ------------ ------------ Loss per share 6- basic loss for the period (1.2)p (0.8)p (1.5)p- diluted loss for the period (1.2)p (0.8)p (1.5)p CONSOLIDATED STATEMENT OF CHANGES IN EQUITY For the six months ended 30 September 2007------------------------------------------------------------------------------------------------------------------ Equity Merger Capital Retained Total share reserve redemption earnings equity capital reserve £'000 £'000 £'000 £'000 £'000 Balance at 1 April 2006 5,450 6,575 3 1,422 13,450 --------- --------- --------- --------- ---------Loss for the period - - - (637) (637) --------- --------- --------- --------- --------- Total income and expense for the period - - - (637) (637) Exercise of options 167 - - - 167 Cost of share-based payments - - - 88 88 Equity dividend - - - (621) (621) --------- --------- --------- --------- ---------Balance at 30 September 2006 5,617 6,575 3 252 12,447 Loss for the period - - - (604) (604) --------- --------- --------- --------- --------- Total income and expense for the period - - - (604) (604) Exercise of options - - - - - Cost of share-based payments - - - 129 129 --------- --------- --------- --------- ---------Balance at 1 April 2007 5,617 6,575 3 (223) 11,972 Loss for the period - - - (976) (976) --------- --------- --------- --------- --------- Total income and expense for the period - - - (976) (976) Exercise of options 66 - - - 66 Cost of share-based payments - - - 61 61 Equity dividend - - - (632) (632) --------- --------- --------- --------- ---------Balance at 30 September 2007 5,683 6,575 3 (1,770) 10,491 --------- --------- --------- --------- --------- CONSOLIDATED BALANCE SHEET As at 30 September 2007----------------------------------------------------------------------------------------------------- Unaudited Unaudited Audited As At As At As At 30 September 30 September 31 March 2007 2006 2007 £'000 £'000 £'000 ASSETS Non-current assets Property, plant and equipment 1,082 792 1,108Intangible assets 6,669 6,506 6,668Deferred tax asset 360 360 360 ------------ ------------ ------------ 8,111 7,658 8,136 ------------ ------------ ------------ Current assets Trade and other receivables 2,917 2,937 3,752Current tax - 12 -Cash and short-term deposits 4,078 6,111 5,213 ------------ ------------ ------------ 6,995 9,060 8,965 ------------ ------------ ------------TOTAL ASSETS 15,106 16,718 17,101 ------------ ------------ ------------ EQUITY AND LIABILITIES Capital and reserves Equity share capital 5,683 5,617 5,617Merger reserve 6,575 6,575 6,575Capital redemption reserve 3 3 3Retained earnings (1,770) 252 (223) ------------ ------------ ------------ Total equity attributable to equity holders of the parent 10,491 12,447 11,972 ------------ ------------ ------------ Current liabilities Trade and other payables 4,615 4,246 5,129Provisions - 25 - ------------ ------------ ------------ TOTAL LIABILITIES 4,615 4,271 5,129 ------------ ------------ ------------ TOTAL EQUITY AND LIABILITIES 15,106 16,718 17,101 ------------ ------------ ------------ CONSOLIDATED CASH FLOW STATEMENT For the six months ended 30 September 2007------------------------------------------------------------------------------------------------------ Unaudited Unaudited Audited 6 months to 6 months to Year to 30 September 30 September 31 March 2007 2006 2007 £'000 £'000 £'000 Cash flows from operating activities Loss before tax (976) (637) (1,225)Depreciation and amortisation 200 87 230Provision against property, plant and equipment - - 25Loss on disposal of property, plant and equipment - - 5Share-based payments 61 88 217Interest income (136) (153) (294)Decrease in provisions - (83) (108)Decrease/(increase) in trade and other receivables 835 (69) (884)(Decrease)/increase in trade and other payables (514) 935 1,818 ------------ ------------ ------------ Cash generated/(consumed) from operations (530) 168 (216) Income tax credit received - 45 41 ------------ ------------ ------------ Net cash (consumed)/generated from operating activities (530) 213 (175) ------------ ------------ ------------ Cash flows from investing activities Purchase of property, plant and equipment (142) (548) (1,027) Expenditure on product development (33) - (172) Interest received 136 153 294 ------------ ------------ ------------ Net cash flows from investing activities (39) (395) (905) ------------ ------------ ------------ Cash flows from financing activities Proceeds from issue of shares 66 167 167 Dividends paid to equity shareholders (632) (621) (621) ------------ ------------ ------------ Net cash flows from financing activities (566) (454) (454) ------------ ------------ ------------ Net decrease in cash and cash equivalents (1,135) (636) (1,534)Cash and cash equivalents at the beginning of period 5,213 6,747 6,747 ------------ ------------ ------------ Cash and cash equivalents at the end of period 4,078 6,111 5,213 ------------ ------------ ------------ NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ---------------------------------------------------------------- 1. CORPORATE INFORMATION The interim condensed consolidated financial statements of GB Group plc ('the Group') for the six months ended 30 September 2007 were authorised for issue in accordance with a resolution of the directors on 26 November 2007. GB Group plc is a public limited company incorporated in the United Kingdom whose shares are publicly traded on the London Stock Exchange. 2. BASIS OF PREPARATION AND ACCOUNTING POLICIES Basis of Preparation These interim condensed consolidated financial statements for the six months ended 30 September 2007 have been prepared in accordance with IAS 34 Interim Financial Reporting. The interim condensed consolidated financial statements are presented in sterling and all values are rounded to the nearest thousand (£'000) except when otherwise indicated. The interim condensed consolidated financial statements do not constitute statutory accounts as defined in section 240 of the Companies Act 1985 and therefore do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Group's annual financial statements as at 31 March 2007. The financial information for the preceding year is based on the statutory accounts for the year ended 31 March 2007. These accounts, upon which the auditors issued an unqualified opinion, have been delivered to the Registrar of Companies. These accounts did not require a statement under either section 237(2), or section 237(3) of the Companies Act 1985. Accounting Policies The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those followed in the preparation of the Group's annual financial statements for the year ended 31 March 2007, except for the adoption of new Standards and Interpretations, noted below. Adoption of these Standards and Interpretations did not have any effect on the financial position or performance of the Group. International Accounting Standards (IAS / IFRS) Adoption date IFRS 7 Financial Instruments: Disclosures 1 April 2007 IAS 1 Amendment: Presentation of Financial Statements - Capital Disclosures 1 April 2007 International Financial Reporting Interpretations Committee (IFRIC) Adoption date IFRIC 8 Scope of IFRS 2 1 April 2007 IFRIC 9 Reassessment of Embedded Derivatives 1 April 2007 IFRIC 10 Interim Financial Reporting and Impairment 1 April 2007 IFRIC 11 IFRS 2 - Group and Treasury Share Transactions 1 April 2007 3. RISKS & UNCERTAINTIES Management identifies and assess risks to the business using a common model. The Group has a number of exposures which can be summarised as follows: regulatory risk resulting from regulatory developments; changes in the Group's competitive position; non-supply by a major supplier; and disaster recovery and business continuity. These risks and uncertainties facing our business were reported in detail in the 2007 Annual Report and Accounts and all of them are monitored closely by the Group. There have been no significant changes in the Group's risk and uncertainty factors during the review period, nor are any expected to for the remainder of the year. 4. SEGMENT INFORMATION All activities undertaken by the Group represent a single segment for reporting purposes. 5. CYCLICALITY Due to the cyclicality of our software renewal business, higher renewals in the second half traditionally result in the Group's performance being biased towards the second half of the year. 6. LOSS PER ORDINARY SHARE Basic Basic loss per share is calculated by dividing the loss attributable to equity holders of the Company by the basic weighted average number of ordinary shares in issue during the period. Unaudited 6 months Unaudited 6 months Audited Year to to 30 September to 30 September 31 March 2007 2006 2007 pence pence pence per per per share £'000 share £'000 share £'000 Loss attributable to equity holders of the parent (1.2) (976) (0.8) (637) (1.5) (1,241) ------ ------ ------ ------ ------ ------ Diluted Diluted loss per share amounts are calculated by dividing the loss for the period attributable to ordinary equity holders by the weighted average number of ordinary shares outstanding during the period plus the weighted average number of ordinary shares that would be issued on the conversion of all the dilutive potential ordinary shares into ordinary shares. 30 Sept 30 Sept 31 March 2007 2006 2007 No. No. No. Basic weighted average number of shares in issue 84,073,515 83,023,079 83,380,985 Dilutive effect of share options - - - ---------- ---------- ---------- Diluted weighted average number of shares in issue 84,073,515 83,023,079 83,380,985 ---------- ---------- ---------- The loss for the period and the weighted average number of ordinary shares used for calculating the diluted loss per share are identical to those used for the basic loss per share. This is because the outstanding share options would have the effect of reducing the loss per ordinary share and would therefore not be dilutive under the terms of IAS 33 Earnings per Share. 7. DIVIDENDS PAID AND PROPOSED Unaudited 6 Unaudited 6 Audited months to months to Year to 30 Sept 30 Sept 31 March 2007 2006 2007 £'000 £'000 £'000 Declared and paid during the period Final dividend for 2007: 0.75p (2006: 0.75p) 632 621 621 --------- --------- --------- Proposed for approval at AGM (not recognised as a liability at 31 March 2007) Final dividend for 2007: 0.75p - - 628 --------- --------- --------- 8. PROPERTY, PLANT AND EQUIPMENT & INTANGIBLE ASSETS During the six months ended 30 September 2007, the Group acquired property, plant and equipment with a cost of £142,000 (2006: £548,000). Expenditure on product development for the six months ended 30 September 2007 was £33,000 (2006: £Nil). No disposals were made in the six months ended 30 September 2007 (2006: £Nil). 9. SHARE-BASED PAYMENT The Group operates Executive Share Option Schemes under which executive directors, managers and staff of the Company are granted options over shares. Executive Share Option Scheme Options are granted to executive directors and employees on the basis of their performance. Options are granted at the full market value of the Company's shares at the time of grant and are exercisable between three and ten years from the date of grant. The options vest when the Company's earnings per share growth is greater than the growth of the Retail Prices Index (RPI) over a 3 year period prior to the exercise date. There are no cash settlement alternatives. Executive Share Option Scheme (Section C Scheme) Options are granted to executive directors and employees on the basis of their performance. Options are granted at the full market value of the Company's shares at the time of grant and are exercisable between three and ten years from the date of grant. The percentage of an option that will vest and be capable of exercise will depend on the performance of the Company. A minimum of 50 per cent. of the options will vest when the Total Shareholder Return (TSR) performance of the Company, as compared to the TSR of the FTSE Computer and CPU Services Sub-Sector over a three-year period, matches or exceeds the median company. The percentage of shares subject to an option in respect of which that option becomes capable of exercise will then increase on a sliding scale so that the option will become exercisable in full if top quartile performance is achieved. GB Sharesave Scheme The Group has a savings-related share option plan, under which employees save on a monthly basis, over a three or five year period, towards the purchase of shares at a fixed price determined when the option is granted. This price is usually set at a 20% discount to the market price at the time of grant. The option must be exercised within six months of maturity of the savings contract, otherwise it lapses. During the six months ended 30 September 2007, the following share options were granted to executive directors, managers and staff of the Company. Scheme Date No. of options Exercise price Executive Share Option Scheme 11 June 2007 317,560 30.75p Executive Share Option Scheme - Section C 11 June 2007 617,440 30.75p GB Sharesave Scheme 1 September 2007 928,675 25.60p The fair value of equity-settled share options granted is estimated as at the date of grant using a binomial model, taking into account the terms and conditions upon which the options were granted. The following table lists the inputs to the model for the six months ended 30 September 2007. Dividend yield (%) 2.30 - 2.40 Expected share price volatility (%) 45.00 Risk-free interest rate (%) 5.20 - 5.60 Lapse rate (%) 5.00 Expected exercise behaviour See below Market-based condition adjustment (%) 48.00 Expected life of option (years) 3.0 - 5.0 It is assumed that 50% of options will be exercised by participants as soon as they are 20% or more "in-the-money" (i.e. 120% of the exercise price) and the remaining 50% of options will be exercised gradually at the rate of 20% per annum for each year they remain at or above 20% "in-the-money". 10. RELATED PARTY TRANSACTIONS Compensation of key management personnel (including directors) Unaudited 6 Unaudited 6 Audited months to months to Year to 30 Sept 30 Sept 31 March 2007 2006 2007 £'000 £'000 £'000 Short-term employee benefits 222 184 457 Post-employment benefits 22 19 41 Share-based payments 5 37 37 --------- --------- --------- 249 240 535 --------- --------- --------- RESPONSIBILITY STATEMENT BY MANAGEMENT -------------------------------------- We confirm that to the best of our knowledge: a) The condensed set of financial statements have been prepared in accordance with IAS 34; b) The interim management report includes a fair review of the information required by DTR 4.2.7R (indication of important events during the first six months and description of principal risks and uncertainties for the remaining six months of the year); and c) The interim management report includes a fair review of the information required by DTR 4.2.8R (disclosure of related party transactions and changes therein). By order of the Board R A LawDirector M T Navin-MealeyDirector INDEPENDENT REVIEW REPORT TO GB GROUP PLC--------------------------------------------------------------------------------Introduction We have been engaged by the Company to review the condensed set of financialstatements in the half-yearly financial report for the six months ended 30September 2007 which comprises the Consolidated Income Statement, theConsolidated Balance Sheet, the Consolidated Cash Flow Statement, theConsolidated Statement of Changes in Shareholders' Equity and the relatedexplanatory notes 1 to 10. We have read the other information contained in thehalf yearly financial report and considered whether it contains any apparentmisstatements or material inconsistencies with the information in the condensedset of financial statements. This report is made solely to the company in accordance with guidance containedin ISRE 2410 (UK and Ireland) "Review of Interim Financial Information Performedby the Independent Auditor of the Entity" issued by the Auditing PracticesBoard. To the fullest extent permitted by law, we do not accept or assumeresponsibility to anyone other than the Company, for our work, for this report,or for the conclusions we have formed. Directors' Responsibilities The half-yearly financial report is the responsibility of, and has been approvedby, the directors. The directors are responsible for preparing the half-yearlyfinancial report in accordance with the Disclosure and Transparency Rules of theUnited Kingdom's Financial Services Authority. As disclosed in note 2, the annual financial statements of the Group areprepared in accordance with IFRSs as adopted by the European Union. Thecondensed set of financial statements included in this half-yearly financialreport has been prepared in accordance with International Accounting Standard34, "Interim Financial Reporting," as adopted by the European Union. Our Responsibility Our responsibility is to express to the Company a conclusion on the condensedset of financial statements in the half-yearly financial report based on ourreview. Scope of Review We conducted our review in accordance with International Standard on ReviewEngagements (UK and Ireland) 2410, "Review of Interim Financial InformationPerformed by the Independent Auditor of the Entity" issued by the AuditingPractices Board for use in the United Kingdom. A review of interim financialinformation consists of making enquiries, primarily of persons responsible forfinancial and accounting matters, and applying analytical and other reviewprocedures. A review is substantially less in scope than an audit conducted inaccordance with International Standards on Auditing (UK and Ireland) andconsequently does not enable us to obtain assurance that we would become awareof all significant matters that might be identified in an audit. Accordingly, wedo not express an audit opinion. Conclusion Based on our review, nothing has come to our attention that causes us to believethat the condensed set of financial statements in the half-yearly financialreport for the six months ended 30 September 2007 is not prepared, in allmaterial respects, in accordance with International Accounting Standard 34 asadopted by the European Union and the Disclosure and Transparency Rules of theUnited Kingdom's Financial Services Authority. Ernst & Young LLPManchester27 November 2007 This information is provided by RNS The company news service from the London Stock Exchange