Malvern Intl Regulatory News (MLVN)

31 Aug 2007 17:17

AEC Education plc31 August 2007 AEC Education plc Unaudited Results for the six months ended 30 June 2007 AEC Education plc (the "Group", "AEC Education", "AEC" or the "Company"), theprovider of educational courses up to postgraduate degree levels in Singapore,Malaysia and Vietnam, is pleased to announce it's un-audited interim results forthe six months ended 30 June 2007. Highlights • The Group's revenue on continuing operations was up 34% at £1,036K (2006: £773K) • Profits before tax were 14% of revenue providing profits after tax and minority interests of £114K (2006: Loss £104K) • The restructuring of the Group combined with the rationalisation of it's product portfolio and 2 small but focused synergistic acquisitions have provided significant revenue growth and a much improved bottom line for the period For further information, please contact: AEC Education plcHaider M SithawallaDirector - FinanceAEC Edu Group Pte Ltdemail : hmsithawalla@aec.edu.sg Nabarro Wells & Co Ltd - NOMADDavid NabarroEmail : davidnabarro@nabarro-wells.co.ukPhone +44 (0)20 7710 7401 Notes to Editors AEC Education PLC is the UK holding company for a number of companies inSingapore, Malaysia and Vietnam that provide educational services toapproximately 16,000 students in the Asia-Pacific region: source of thefastest-growing market for international students. The Group offers class-basedinstruction at its various educational campuses in the Central Business Districtof Singapore, Malaysia and Vietnam and distance learning, up to postgraduatelevels. It also provides degree qualifications on behalf of several leadinginternational universities, targeting the large volumes of overseas students inthat region in line with the Singapore Government's Global Schoolhouse Vision tomake Singapore an Education Hub. AEC's aim is to be a leader in quality education through facilitating learning,fostering creativity and developing knowledge, skills and confidence in itsstudents. The Group's recognition by the Singapore Government as a prestigiousand forward-moving company is shown by its receipt of four Singapore QualityClass Awards. In August 2006, AEC was again awarded the "Case Trust" Certification for PrivateEducation Organizations, a student protection scheme for foreign students. Thisfurther endorses AEC's position as a recognized quality provider in theeducation industry. Chairman's Statement Financial Review Unaudited results for the six months period up to 30 June 2007 showed a turnoverof £1,036K - 34% higher than for the same period in 2006. During this period,the Group recorded profits after tax and minority interests of £114K. The turnaround in profits reflects the strength of the programs that weintroduced towards the end of last year and of and the Company's policy ofmaking small strategic acquisitions. We expect the momentum of these results to continue. Company Strategy We will continue to pursue synergistic acquisitions and partnerships to furtherbuild revenue and profits in the future. The newly launched Hospitality program has seen immediate results and we areintending to spread the development of this program throughout our region. We have initiated a twinning program between the Singapore and Vietnam schoolsfor the Hospitality Management program. Further, our market development effortin Vietnam for the LCCI programs is also likely to see rewards during this year.In anticipation of the increased demand in the second half of the year, theschool at Ho Chi Minh City has moved to larger premises. Smartworks in Singapore is providing a new platform for us to work closely withUniversity of Southern Australia (UniSA). We are in the midst of finalizing thedetails for a full-time degree course in Property Management to be launched inSingapore and Vietnam. Going forward, we will be expanding the range of our twinning programs in India,Nepal and China. We also plan to launch a Nursing Aid program later this year or early next yearwhich will feed into the Nursing Diploma programs. A part of our strategy for growth this year is the relocation of ourheadquarters in Singapore and the associated campus to larger and more modernpremises in the Bukat Merah district of Singapore. This new campus will havebetter infrastructure to meet the increased technology demands of the new mediaand communication courses that have been introduced recently. It will cater forthe growing number of students on campus with a larger number of classrooms andother support facilities. Dividends No interim dividends are recommended by the Board. Outlook The Board is looking at complementary acquisitions in the region in order to expand it presence and catchment area for student recruitment. In the interim, it is also deepening the impact of its newly launched programs by broadening its existing partnerships with established Educational institutions. There will be a cost associated with the relocation of our Singapore headquarters later this year. We anticipate that this will cost £165K which will be written off over 6 years. The Board continues to take the necessary measures to increase revenue and, to implement strategic investment to strengthen long term profitability and return to shareholders. We will also continue to invest in the operations so that relative costs are driven down as we expand the Group's revenue base. Liam Swords (Chairman) UNAUDITED CONSOLIDATED PROFIT AND LOSS STATEMENT Group Group ------- ------- Six months Six months ------------ ------------ To To ---- ---- 30 June 30 June --------- --------- Note 2007 2006 ------ ------ £'000 £'000 --- ------- ------- Unaudited Unaudited TurnoverSales of services and other revenue (4) 1,036 773 Cost of Sales (955) (941) --------- ----------- Operating Profit/(loss) 81 (168) --------- -----------Profit/(loss) from operations 81 (168) Share of results of associated companies 66 60 --------- -----------Profit/(loss) on ordinary activities beforetaxation 147 (108) Tax on profit on ordinary activities (33) - --------- -----------Profit/ (loss) on ordinary activities aftertaxation 114 (108) Minority interests - 4 --------- -----------Profit / (loss) for the period 114 (104) --------- -----------(Accumulated Loss) / Retained Profits broughtforward (242) 30Profit/(loss) for the period 114 (104)Dividends (6) - - --------- ----------- --------- -----------(Accumulated loss) carried forward (128) (74) --------- ----------- Earnings / (Loss) per share Pence Pence --------- -----------Basic (6) 0.8 (0.7) --------- ----------- UNAUDITED CONSOLIDATED BALANCE SHEET Note As at As at ------ ------- ------- 30 June 2007 30 June 2006 -------------- -------------- £'000 £'000 ------- ------- Unaudited UnauditedFixed assetsIntangible Assets 160 5Tangible Assets 135 166Investments in associated companies (7) 1,352 1,437 --------- --------- 1,647 1,608 Current AssetsDebtors 921 741Cash at bank and in hand 164 73 --------- --------- 1,085 814CreditorsAmounts falling due within one year (940) (491) --------- --------- Net Current Assets 145 323 --------- ---------Total Assets 1,792 1,931Deferred taxation - -Minority interest - (3) --------- --------- 1,792 1,928 --------- --------- Capital and ReservesCalled up share capital 1,491 1,491Share Premium 243 243Reserves 58 194 --------- ---------Total Equity Shareholders funds 1,792 1,928 --------- --------- UNAUDITED CONSOLIDATED CASH FLOW STATEMENT Six months Six months 30 June 2007 30 June 2006 Unaudited Unaudited £'000 £'000 Cash flow from operating activities 72 161 Returns on investment and servicing of financeInterest paid (3) (4) TaxationTaxes paid (23) (11) Capital expenditure and financial investmentPurchase of tangible fixed assets (31) (48)Acquisition of subsidiary - (17) ----------- ---------- (31) (65) ----------- ---------- Cash flows from financing activitiesIncrease in finance lease liabilities 20 -Repayment of finance leases - (2)Minority interests - 3 ----------- ---------- 20 1 ----------- ---------- Net increase in cash and cash equivalents 35 82 Cash and cash equivalents at beginning of period 76 (31) ----------- ----------Cash and cash equivalents at end of period 111 51 ----------- ---------- Cash and cash equivalents consist of the following: Cash and bank balances 164 73Bank overdraft (53) (22) ----------- ---------- 111 51 ----------- ---------- Reconciliation of profit before tax to cash flow Six months Six months 30 June 2007 30 June 2006 Unaudited Unaudited From operating activitiesProfit / (loss) before tax (104) 147 Adjustments for:Depreciation & amortisation 27 29 Inventories written off - 37Provision for doubtful debts - 17Interest paid 3 4Share of results of associated companies (66) (60)(Increase)/ decrease in debtors (205) 161Decrease in creditors 158 66Decrease in inventories 6 12Translation 2 (1)-------------------------------------- ---------Cash flow from operating activities 72 161-------------------------------------- --------- 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 2007. The financial informationfor the period ended 30 June 2007 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 period ended 30 June 2006, are those as published in the Company's half yearannouncement made on 15 September 2006. 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 2007 have been preparedon the basis of International Financial Reporting standards ("IFRS") andaccounting policies consistent with those adopted for the year ended 31 December2006, and to be adopted in respect of the year ending 31 December 2007. 4 Sale of Services June 2007 June 2006 £'000 £'000 Course fees and registration fees 809 537Sales of systems and support services 165 169Other income 62 67 -------------- ------------ 1,036 773 -------------- ------------ 5 Dividend During the current financial period, no dividend has been declared orrecommended. 6 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 in issueduring the period was 14,916,042 (2005: 14,916,042). 7 Investments in Associated Companies Details of associated companies held by AEC Edu Group Pte Ltd as at 30 June 2007are as follows: Associatedcompanies andCountry of Principal activities Equity held byIncorporation (Place of business) the Subsidiary--------------- --------------------- -------------- June June ------ ------ 2007 2006 ------ ------ % % ------ ------Keris Murni Sdn Provides education services 30 30Bhd and the operation of education(Malaysia) tuition centers (Malaysia) Pusat Tuisyen Provides education services 30 30Kasturi Sdn Bhd and the operation of education(Malaysia) tuition centres (Malaysia) Educational Provides consultancy services in 34.96 34.96Resources Pte Ltd education, related services and(Singapore) business training ------ ------ This information is provided by RNS The company news service from the London Stock Exchange