Malvern Intl Regulatory News (MLVN)

29 Sep 2005 12:45

AEC Education plc29 September 2005 Press Release 29 September 2005 AEC Education plc Unaudited Results for the six months ended 30 June 2005 AEC Education plc ("AEC Education", "AEC" or the "Company"), the provider of educational courses to postgraduate degree level in Singapore and Malaysia, announces its unaudited interim results for the six months ended 30 June 2005. Highlights • The Group's revenue on continuing operations was £870K.• Profit before tax on continuing operations for the period is £193k in June 2005.• A dividend of 1.6p per share was paid in July 2005.• Earnings per share as at 30 June 2005 1.2p. Shares in issue as at 30 June 2005 were 14,916,042 (July 2004: 13,086,414)• The CaseTrust Award (Student Protection Scheme) was awarded to the Group in August. The CaseTrust Award is mandatory for institutions recruiting foreign students. The award of the CaseTrust, will facilitate the Group in capturing the increasing number of Asian students seeking quality education in Singapore.• We are working with Mendaki (a Malay self-help group), to offer skills development through the Government's Skills Redevelopment Fund in which a 90% subsidy of the tuition fees is given to students/employees who want to upgrade and re-skill themselves.• The University of Leicester has appointed AEC as an agent to conduct the Doctorate of Education programmes in Singapore with 10 new students. At the same time the Group also took over the existing 53 Doctorate students on the programme from another agent. For further information: AEC Education plc Ramasamy Jayapal, Finance Director Tel: +65 (62203500) Abchurch Communications Katherine Murphy / Julian Bosdet Tel: +44 (0) 20 7398 7700kathrine.murphy@abchurch-group.com www.abchurch-group.com Notes to Editors Founded in 1985 in Singapore and Malaysia, AEC is the UK holding company for anumber of companies that provide business educational services to approximately16,000 students in the Asia-Pacific region: the fastest-growing source marketfor international students. The group offers class-based instruction at thelargest educational campus in Singapore's Central Business District and distancelearning up to postgraduate level. In addition, it provides degreequalifications on behalf of several leading international universities,targeting the large volumes of overseas students that the Singaporean governmenthas announced in the Global Schoolhouse Vision it intends to increase. AEC's aim is to be a leader in quality education through facilitating learning,fostering creativity and developing knowledge, skills and confidence in itsstudents. Its receipt of four rare Singapore Quality Class Awards shows theGroup's recognition by the Singaporean Government as a prestigious andforward-moving company. In August 2005, AEC was awarded the CaseTrust for Private EducationOrganizations, a student protection scheme for foreign students. This is afurther step by AEC in its recognition as a quality provider in the educationindustry. Chairman's Statement Financial ReviewUnaudited results for the six months period to 30 June 2005 show a turnover of £870k. The operating profits before tax for the period were £193K. Revenue was adversely affected by the volatility of the training market in Singapore at the beginning of the period and this caused overseas students to adopt a wait and see attitude. The resulting consolidation has now occurred and we should see increased organic growth from the beginning of next year. The reduction in margins is the result of investment in increasing the management team to strengthen the drive for growth. Basic earnings per share amounted to 1.2p in June 2005. DividendThe Board do not recommend the payment of an interim dividend (last year Nil). The Company paid a dividend of 1.6p on 31 July in respect of the financial period ended 31 December 2004 and it is the Board's current intention to recommend a dividend for the period ending 31 December 2005. OrganizationIn our recent announcement on 23 May 2005, it was mentioned that a new Chief Operating Officer, Prof Chan Yoke Kai was appointed. Following his appointment, the Board has strengthened the team by bringing in further experienced management - Dr. Kelvin Lee and Mr. Eugene Lee to assist Professor Chan in the drive for growth. Outlook During the period, the Group finalized and launched the Doctorate in Education programme from Leicester University. Similarly, a partnership with James Watt College has been finalized and the programme will be launched in January. A Bachelor of Hospitality Management course from Edith Cowan University is being finalized for launch in November. These and the continuing work on partnerships will broaden the base of programmes offered in the business and will begin to show a return next year. The Board is committed in maintaining the pace of development during the next six months and will seek to broaden its service offerings by pursuing opportunities around the world as they become available. William Swords UNAUDITED CONSOLIDATED PROFIT AND LOSS STATEMENT Six months to Seven months to Year to 30 June 31 July 31 December Note 2005 2004 2004 £'000 £'000 £'000 Unaudited Audited UnauditedTurnoverSales of services and otherrevenue (4) 870 858 1,511 Cost of Sales (710) (606) (1,033) --------- --------- ------------- Operating Profit 160 252 478 Exceptional items (5) - - 72 --------- --------- -------------Profit from operations 160 252 550 Share of results ofassociated 33 47 29companies --------- --------- -------------Profit on ordinaryactivities 193 299 579before taxation Tax on profit on ordinaryactivities (15) (13) (31) --------- --------- -------------Profit on ordinaryactivities 178 286 548after taxation --------- --------- -------------Profit for the period 178 286 548 --------- --------- ------------- Retained Profits brought 67 790 790forwardProfit for the period 178 286 548Dividends (6) (239) (1,271) (1,271) --------- --------- ------------- --------- --------- -------------Retained Profits carried 6 (195) 67forward --------- --------- ------------- Earnings per ordinary Pence Pence PenceShare --------- --------- -------------Basic (7) 1.2 2.4 4.4 --------- --------- ------------- UNAUDITED CONSOLIDATED BALANCE SHEET Note As at As at As at 30 June 2005 31 July 2004 31 December 2004 £'000 £'000 £'000 Unaudited Audited UnauditedFixed assetsIntangible Assets 31 30 34Tangible Assets 72 58 51Investments inassociated (8) 1,270 1,272 1,249companies --------- ---------- ------------- 1,373 1,360 1,334 Current Assets Debtors 1,019 658 918Cash at bank and in hand 109 29 421 --------- ---------- ------------- 1,128 687 1,339CreditorsAmounts falling duewithin (573) (782) (724)one year --------- ---------- ------------- Net CurrentAssets/(liabilities) 555 (95) 615 --------- ---------- -------------Total Assets lesscurrent 1928 1,265 1,949liabilitiesProvisions forliabilities (13) (13) (13)and charges --------- ---------- ------------- 1915 1,252 1,936 --------- ---------- ------------- Capital and ReservesCalled up share capital 1,491 1,387 1,491Share Premium 373 146 384Reserves 51 (281) 61 --------- ---------- -------------Total EquityShareholders 1915 1,252 1,936funds --------- ---------- ------------- UNAUDITED CONSOLIDATED CASH FLOW STATEMENT Year Six months Seven months 31 December 30 June 2005 31 July 2004 2004 Unaudited Audited Unaudited £'000 £'000 £'000 Cash flow from operatingactivities (301) 9 (104) Returns on investment and servicing offinanceInterest paid - - (2) TaxationTaxes paid (11) - (2) Capital expenditure and financialinvestmentPurchase of tangible fixedassets (33) (2) (4)Purchase of intangible fixedassets (15)Proceeds from disposal of tangible - - -fixed assetsProceeds from disposal ofsubsidiary companies - 1 1 ------------ -------- ---------- ( 33) (1) (18) Cash flows financing activities - -Receipts from borrowings - - 106Repayment of finance leases - - -Issue of share capital - - 625Expenses paid in connectionwith share issues (11) - (198)Dividend received 44 - - ------------ -------- ---------- 33 - 533 ------------ -------- ---------- Net increase in cash (312) 8 407 Cash at beginning of year 421 21 21Exchange movements - - (7) ------------ -------- ----------Cash at end of year 109 29 421 ------------ -------- ---------- RECONCILIATION OF PROFT BEFORE TAX TO CASH FLOW Six months Seven months Year 30 June 31 July 31 December 2005 2004 2004 Unaudited Audited Unaudited From operating activitiesProfit before tax 193 299 579Depreciation & amortisation 18 18 32Profit on disposal of assets - (7) (7)Interest paid - - 2Income from associated undertakings (33) (47) (29)Increase in debtors (79) (124) (203)Decrease/(increase) in creditors (410) (120) (478)Translation 10 (10) ------------------------ ----------- ----------- ---------- Cash flow from operating activities (301) 9 (104)----------------------- ----------- ----------- ---------- Notes 1. Publication of non-statutory accounts and basis of preparation. The financial information contained in this interim report does not constitutestatutory accounts for the period ended 30 June 2005. The financial informationfor the period ended 30 June 2005 is derived from the unaudited consolidatedaccounts of AEC Edu Group Pte Ltd for the period, consolidated with theunaudited accounts of the Company on a merger basis. The comparative figures forthe year ended 31 December 2004, are those as published in the Company's maideninterim announcement made on 23 May 2005. The comparative figures for the sevenmonths ended 31 July 2004 are those of the consolidated audited accounts of AECEdu Group Pte Ltd for that period as included in the Prospectus issued by theCompany on 8 December 2004.This report has been approved by the Board of Directors and is unaudited. Thisreport does not comprise statutory accounts within the meaning of Section 240 ofthe Companies Act 1985. 2. General The principal activities of the Company are that of investment holding andprovision of educational consultancy services. There have been no significantchanges in the principal activities of the subsidiary companies during theperiod. 3. Accounting Policies The unaudited results for the six months ended 30 June 2005 have been preparedon the basis of International Financial Reporting standards ("IFRS") andaccounting policies consistent with those adopted for the year ended 31 December2004, and to be adopted in respect of the year ending 31 December 2005, and asstated in the Prospectus dated 8 December 2004 and announcement dated 23 May2005. 4. Sale of Services June 2005 July 2004 Dec 2004Course fee 580 467 916Sales of systems and support services 248 303 501Other income 42 88 94 -------------- ------------ ---------- 870 858 1,511 -------------- ------------ ---------- 5. Exceptional Items June 2005 July 2004 Dec 2004Write back of trade creditor balance - - 65Gain on disposal of investment insubsidiary companies - - 7 --------- -------- ---------- 72 --------- -------- ---------- The write-back of trade creditor balance relates to commission payable recordedin prior years which has been agreed with the third party as no longer payable. 6. Dividends As announced on 23 May 2005, AEC has declared an interim dividend of 1.6p perOrdinary Share (£238,567), which was paid on 31 July 2005. 7. Earnings per share Basic earning per share is calculated by dividing the earnings attributable toordinary shareholders by the weighted average number of ordinary shares in issueduring the relevant period. The weighted average number of shares issued duringthe period was 14,916,042 (December 2004: 12,548,883; July 2004: 11,903,557). 8. Investments in Associated Companies Details of associated companies held by AEC Edu Group Pte Ltd as at 30 June2005, are as follows: Associatedcompanies andCountry of Principal activities Equity held byIncorporation (Place of business) the Subsidiary --------------------- --------------------- June July 2005 and 2004 December 2004 % % Keris Murni Sdn Provides education services 30 30Bhd and the operation of(Malaysia) education tuition centers (Malaysia) Pusat Tuisyen Provides education services 30 30Kasturi Sdn Bhd and the operation of(Malaysia) education tuition centres (Malaysia) Educational Provides consultancy services 34.96 -Resources Pte in education, related servicesLtd and business training(Singapore) 9. On 19 November 2004, the whole of the issued share capital of the AEC Edu Group Pte Limited, a company registered in Singapore was acquired by AEC Education plc, in consideration for the issue of 13,086,394 Ordinary Shares of 10p each in AEC Education plc. AEC Education plc is the ultimate holding company. AEC Education plc placed a further 1,829,628 new Ordinary Shares of 10p each at 41p per Ordinary Share and was admitted to trading on AIM on 10 December 2004. This information is provided by RNS The company news service from the London Stock Exchange