Plethora Solutions Holdings Plc Regulatory News (PLE)

25 Sep 2006 07:03

Plethora Solutions Holdings PLC25 September 2006 PLETHORA SOLUTIONS HOLDINGS PLC INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2006 Plethora Solutions Holdings plc ('Plethora') (AIM:PLE) is a specialtypharmaceutical company with an advanced portfolio of development and marketedproducts for the treatment of urological disorders and sexual dysfunction. Financial Highlights - Acquisition of Timm Medical Technologies, Inc. ('Timm') accompanied by a placing of 3.2m shares raising £6.3m net of expenses - Revenues of £2.4m (H1 2005: £0.0m) - Loss after tax of £2.0m (H1 2005: £3.7m) - Cash and short term investments at 30 June 2006 of £6.6m (H1 2005: £7.9m) Operational Highlights - January 2006: Acquisition of Timm Medical Technologies, Inc. Timm has a 20 strong urology sales force in the US and currently sells a range of devices for the treatment of erectile dysfunction (ED) - February 2006: Acquisition of North American rights to Invicorp(R), an injectable late stage development drug for the treatment of ED - March 2006: IND clearance for PSD597 for treatment of interstitial cystitis - June 2006: Exclusive licensing agreement with Maelor Pharmaceuticals providing access to Maelor's micelle nanotechnology for application in PSD597 - June 2006: Licensing agreement with Metris Therapeutics and funding from Metris shareholders for the development of PSD508 and PSD509 and associated delivery technology Operational Highlights Post-reporting Period - August 2006: Positive, preliminary clinical data supporting the supplementary use of PSD502 for the relief of pain in skin graft patients - September 2006: 510(k) marketing approval from US FDA for diagnosis and evaluation of ejaculation latency using the PSD401 (SAM(TM)) device Steven Powell, CEO of Plethora, said: "These results demonstrate the significant impact of the acquisition andsubsequent integration of the Timm Medical business. The acquired business hasproven to be a good strategic fit for Plethora; it broadens our urology productoffering, smoothes revenues and provides us with a US presence with,importantly, a 20 strong specialist sales force. "We remain committed to building a low risk, revenue driven business model basedon both product marketing and the development and licensing of re-profiledmarketed drugs for new urology indications. In the second half of 2006 we lookforward to the continued growth of product revenues and are confident that we will add significant licensing income from PSD502 to the top line." For further information please contact: Plethora Solutions Tel : 020 7269 8630Steven Powell Collins Stewart Tel: 020 7523 8350Tim Mickley City/Financial Enquiries Tel: 020 7379 5151MaitlandBrian Hudspith/Liz Morley Chairman and Chief Executive's Statement The strategy of the Group is to develop and market products for the treatment ofurological disorders and generate revenues from two routes; from direct sales ofproducts in the North American market and by licensing out products at the endof Phase II clinical development. The first half of 2006 has seen the Group makesignificant advances in both areas. Product Revenues: The New Year opened with the acquisition of Timm Medicalaccompanied by an oversubscribed share placing. Timm provides us with a NorthAmerican sales and marketing operation targeting the urologist and a revenuestream based on sales of the ErecAid(R) product for the treatment of erectiledysfunction (ED). This vacuum device targets a well-defined market comprisingpatients that are contraindicated for oral ED drug treatments, such as Viagra,and patients who fail treatment with oral ED drugs. In February we built on thisbase further with the acquisition of rights to Invicorp(R), an injectable drugproduct also for the treatment of ED which can be sold through the Timm Medicalsales force. Product Licensing: Licensing out rights to projects upon successful completionof Phase II clinical development provides us with the opportunity to generaterevenues through development milestone payments and royalties from productsales. Licensing discussions are at a late stage for our lead programme, PSD502,which we have developed as a topical spray treatment for premature ejaculationand we look forward to announcing our first agreement in the near future. Product Development: In parallel we have continued to develop our pipeline withthe initiation of Phase II clinical programmes for PSD506, a treatment foroveractive bladder and also for PSD597, a treatment for interstitial cystitis.Through an innovative licensing agreement we also acquired rights to a newintravaginal drug delivery technology and two clinical stage programmes (PSD508and PSD509) for the treatment of uro-gynaecological conditions. This creates abroader clinical coverage while remaining true to our urological expertise. Ourdevelopment strategy of combining proven, marketed pharmaceuticals with noveldelivery and formulation technology in a urology setting remains key tominimising risk associated with pharmaceutical product development. Risk to theinvestor can also be lessened by working across a pipeline of products and wenow have five Phase II programmes likely to complete and report between now andlate 2007. As well as spreading business risk this also provides us withmultiple opportunities to secure cash generative licensing agreements withmarketing and development partners. Pipeline Update: Male Sexual Dysfunction: - Premature Ejaculation PSD502, Plethora's most advanced development programme, is a metered-dose aerosol analgesic spray for the treatment of premature ejaculation (PE); acondition which is believed to afflict 25-30% of the male population of the USA and Western Europe. This market has a potential value in excess of $5billion. A Phase II study, reported in December 2005, found a statistically significant (almost four-fold) increase in time to ejaculation over placebo. Following on from the Phase II PE clinical study, we have now concluded a successful 'End of Phase II' meeting with the FDA, where the agency accepted the outline plans formanufacture, remaining pre-clinical development and the outline of a Phase IIIstudy for the registration of PSD502 in the USA. The objective now is for alicensing partner to drive this final step in development and take the productinto the market. The Group has been engaged in active licensing discussions witha number of potential development and marketing partners. We expect to concludethese discussions with one or more partners in the near future. A significant development in the PSD502 programme was the identification of asecond highly valuable indication. Lidocaine and prilocaine are marketed aseffective analgesics in a number of pain indications. Plethora's novel andunique aerosol formulation of these two anaesthetic compounds has a very rapidonset of action and can be applied painlessly to wounds and burns. The Group hasinitiated a series of clinical studies at wound and burns units in the UK todemonstrate the efficacy of the product. Preliminary data communicated post thereporting period indicate that 75% of severely burnt patients dosed to date havereported no pain or minimal pain at donor site following treatment with PSD502.In addition the product was, as expected, well tolerated with no reportedadverse treatment effects. Also post the reporting period, we announced receipt of 510(k) marketingclearance from the FDA in the US for PSD401, the SAM(TM) device. This productenables the reliable measurement and recording of ejaculation latency; initiallyin clinical trials although, ultimately, we anticipate that SAM(TM) will be usedmore widely by urologists in the general evaluation and management of the manymillions of men suffering from premature ejaculation. With the receipt of 510(k)approval from the US FDA we can now move forward with the full commercialisationof this product in the US and, to this end, we will continue to generateadditional clinical data over the course of H2 2006 that will be used as thebasis for obtaining coding and reimbursement in the US as a diagnosticprocedure. - Erectile Dysfunction - Timm Medical In January 2006, Plethora acquired Timm Medical Technologies, Inc in Minnesota,USA which markets products for the diagnosis and treatment of erectiledysfunction (ED). Timm's product for the treatment of ED, ErecAid(R), wasapproved by the FDA in 1998 and is reimbursable in the US, UK and Germany. It ismarketed through a Timm sales force in the US and via an extensive, recentlyrevitalised international distribution network. The ErecAid(R) product, whichgenerated revenues of approximately $9.5m in 2005, is targeted specifically atpatient groups who have either failed treatment of ED by oral drugs or patientswho are precluded from using oral drugs for safety reasons. This patientpopulation represents 3m people in the US alone. Having acquired a specialist ED sales force Plethora was then able, also inFebruary 2006, to acquire North American rights to a complementary EDtherapeutic product, Invicorp(R), which is approved in three non-US territoriesand has completed extensive clinical studies in the US. Urinary Incontinence: - Stress Urinary Incontinence PSD503 is a topical treatment for stress urinary incontinence (SUI), a conditionthought to affect over 20m women in North America and Europe. Having completed asmall pilot study which demonstrated product safety, the Company initiated aPhase II clinical programme at the end of 2005 and data are expected to beavailable from this study in the first half of 2007. - Overactive Bladder Under an exclusive license agreement entered into with Hoffman-La Roche in 2005,Plethora acquired rights to a novel, oral muscarinic receptor selectiveantagonist, PSD506, which is a potential treatment for overactive bladder andrelated symptoms in men and women. The potential market for this product isextensive, encompassing over 40m patients in Europe and North America. Thecompound was evaluated successfully in three Phase I studies by Roche in men andwomen. Plethora is initiating three Phase II clinical studies in 2006 with theobjectives of establishing the efficacy, safety and potential superiority ofPSD506 over marketed anti-muscarinic drugs. These studies are expected to reportin mid-2007. Uro-gynaecology: The expansion of the pipeline with three new development programmes for thetreatment of uro-gynaecological conditions represents a significant newdevelopment for Plethora in H1 2006. Two of these projects, PSD508 and PSD509,were licensed from Metris Therapeutics Limited ('Metris') together with accessto novel underlying technology which enables intra-vaginal delivery of drugs.These new programmes are funded from existing working capital and by theplacement of approximately 375,000 shares to Metris shareholders. - Interstitial Cystitis PSD597 is being developed for the treatment of interstitial cystitis (IC) andchronic pelvic pain (CPP), a condition which afflicts approximately 38% of thefemale population and for which there is no effective treatment. This productutilises a drug marketed currently for other indications and the Group does notenvisage there to be any untoward safety issues. The product has been testedsuccessfully in two clinical pilot studies which demonstrated the potential ofPSD597 to reduce pain in chronic IC patients. Plethora received clearance fromthe FDA for an IND for this product in March 2006 and has subsequently embarkedon a 20 centre Phase II study in North America which is expected to reportpreliminary data towards the end of 2006. - Uterine and Menstrual Pain The two development programmes arising from the acquisition of rights to Metristechnology are PSD508 and PSD509 for the treatment of dysmenorrhea (menstrualrelated pain and cramps) and uterine pain respectively. In both cases marketeddrugs with well understood mechanisms of action and safety profiles have beenreformulated to be administered intra-vaginally. This proprietary local deliverytechnology minimises systemic exposure to the drug and potentially enhancesefficacy by administering higher doses than would be possible to deliver orally. Dysmenorrhea is a painful, often incapacitating, menstrual cramp which afflictsmore than 50% of women of reproductive age. 'Primary' dysmenorrhea occurs withthe onset of menstruation in healthy females. 'Secondary' dysmenorrhea may beginlater in life and is strongly linked with endometriosis, uterine fibroids andpelvic infection. Financial Review: In the six months ended 30 June 2006, Plethora recorded a loss before and aftertaxation of £2.0m, a £1.7m improvement on the loss in the same period in 2005.The reduction in the loss has been driven by the introduction of revenues andoperating profits from the Timm Medical business, acquired in February 2006, andthe fact that the loss for the 2005 period contained a £1.6m licensing paymentto Hoffman-La Roche relating to PSD506. The £2.0m loss at the half year includes for the first time non-cash charges of£72,000 and £170,000 respectively reflecting the amortisation of goodwillfollowing the Timm Medical acquisition and the treatment of employee shareoptions under FRS 20 share based payments. Expenditure on research and development and other administrative costs at thesix months ending 30 June 2006 remain in line with expectations for the fullyear 2006. Cash outflow from operating activities for the period was £2.0m, reflecting theloss in the period. With a cash position at 30 June 2006 of £6.6m followingshare placings in February and June 2006 and consolidation of operating profitsfrom the Timm operation, the Group has sufficient funds to deliver its expandedproduct pipeline to the point where projects can be licensed to pharmaceuticalpartners who, in turn, will complete the development and commercialisation ofthe products. Outlook: We now have a rare combination of a broad yet clinically focused pipelinetogether with a burgeoning US specialty sales and marketing operation in thesame clinical field. Having assembled this unique asset base we are now addingvalue by advancing our development programmes through Phase II clinical studiesbefore licensing on to marketing partners. In parallel, we will build on thecurrent Timm product revenues through both organic growth and strategicpartnerships. Plethora has grown and developed rapidly over the last 18 monthsand we intend to maintain this growth as we continue towards our goal ofbecoming a sustainable and valued urology business. We look forward to updating shareholders on our progress as our Company developsfurther. Stuart Wallis Steven Powell Chairman Chief Executive Officer PLETHORA SOLUTIONS HOLDINGS PLC Consolidated Summarised Profit and Loss Account For the six months ended 30 June 2006 6 months ended 6 months ended Year ended 30 June 30 June 31 December 2006 2005 2005 As restated As restated Note Unaudited Unaudited Audited £'000 £'000 £'000 Turnover- continuing operations - - 17- acquisitions 2,406 - - ------------ ----------- ---------- 2,406 - 17 Cost of sales 562 - - ------------ ----------- ---------- Gross profit- continuing operations - - 17- acquisitions 1,844 - - ------------ ----------- ---------- 1,844 - 17 Administrative expensesContinuing operations- research and developmentexpenses (1,669) (3,039) (4,614)- other administrativeexpenses (880) (647) (1,406)Acquisitions- amortisation of goodwill (72) - -- other administrativeexpenses (1,358) - - ------------ ----------- ---------- (3,979) (3,686) (6,020) Operating (loss)/profit- continuing operations (2,549) (3,686) (6,003)- acquisitions 414 - - ------------ ----------- ---------- (2,135) (3,686) (6,003) Net interest receivable 137 37 198 ------------ ----------- ---------- Loss on ordinary activitiesbeforetaxation (1,998) (3,649) (5,805) Tax on loss on ordinaryactivities - - 143 ------------ ----------- ---------- Loss on ordinary activitiesafter taxation and transferredfrom reserves 4 (1,998) (3,649) (5,662) ------------ ----------- ---------- Basic loss per share 2 (8.1p) (20.9p) (32.3p) ------------ ----------- ---------- Consolidated Summarised BALANCE SHEET AS ON 30 JUNE 2006 At At At 30 June 30 June 31 December 2006 2005 2005 As restated As restated Note Unaudited Unaudited Audited £'000 £'000 £'000Fixed assetsIntangible assets 5,710 - -Tangible assets 162 60 70 --------- ------------- ---------- 5,872 60 70 Current assetsStocks and work inprogress 246 - -Debtors 950 186 269Cash at bank and in hand 6,573 7,889 6,213 --------- ------------- ---------- 7,769 8,075 6,482 Creditors: amounts falling duewithin one year (1,594) (575) (797) --------- ------------- ---------- Net current assets 6,175 7,500 5,685 --------- ------------- ---------- Total assets less currentliabilities 12,047 7,560 5,755 Creditors: amounts falling dueafter one year (815) - - --------- ------------- ----------Net assets 11,232 7,560 5,755 --------- ------------- ---------- Capital and reservesCalled up share capital 3 258 222 222Share premium account 16,068 8,825 8,813Other reserves 4,908 4,846 4,908Profit and loss account (10,002) (6,333) (8,188) --------- ------------- ----------Equity shareholders'funds 4 11,232 7,560 5,755 --------- ------------- ---------- Consolidated Summarised cash flow statement For the six months ended 30 June 2006 6 months ended 6 months ended Year ended 30 June 30 June 31 December 2006 2005 2005 Note Unaudited Unaudited Audited £'000 £'000 £'000 Net cash outflow fromoperatingactivities 5 (2,009) (3,423) (5,425) Returns on investmentsand servicing of finance Interest received 152 37 248Interest paid - - (50) ----------- ----------- ----------Net cash inflow fromreturns on investmentsand servicing of finance 152 37 198 ----------- ----------- ---------- Taxation - - 143 Capital expenditure andfinancial investmentPurchase of tangible fixedassets (67) (24) (52) ----------- ----------- ----------Net cash outflow fromcapital expenditure and financial investment (67) (24) (52) ----------- ----------- ---------- Acquisitions anddisposalsPurchase of subsidiaryundertakings (5,007) - - ----------- ----------- ----------Net cash outflow fromacquisitionsand disposals (5,007) - - ----------- ----------- ---------- Cash outflow beforefinancing (6,931) (3,410) (5,136) ----------- ----------- ---------- FinancingIssue of ordinary sharecapital 7,790 10,000 10,000Share issue costs (499) (50) (50)Loans advanced - (700) (700)Loans repaid - 2,000 2,050 ----------- ----------- ----------Net cash inflow fromfinancing 7,291 11,250 11,300 ----------- ----------- ----------Increase in cash 6 360 7,840 6,164 ----------- ----------- ---------- Consolidated Summarised statement of total recognised gains and losses For the six months ended 30 June 2006 6 months ended 6 months ended Year ended 30 June 30 June 31 December 2006 2005 2005 As restated As restated Unaudited Unaudited Audited £'000 £'000 £'000 Loss for the financial period (1,998) (3,655) (5,662)Currency translation differenceson foreign currency net investments 14 - - ----------- ---------- ----------Total recognised gains and lossesrelating to the period (1,984) (3,655) (5,662)Prior year adjustment (note 1) (232) - - ----------- ---------- ----------Total gains and losses recognisedsince last annual report (2,216) (3,655) (5,662) ----------- ---------- ---------- Notes to the interim statement For the six months ended 30 June 2006 1 BASIS OF PREPARATION The consolidated interim financial statements have been prepared in accordancewith applicable accounting standards and under the historical cost convention.The principal accounting policies of the group have remained unchanged fromthose set out in the Company's 2005 annual report and financial statements,except in relation to share based payments as set out below. Prior year adjustment regarding share based payments Further to the introduction of FRS 20 the company's accounting policy relatingto share based payments is set out below. All share-based payment arrangements are recognised in the consolidatedfinancial statements. The Group operates equity-settled share-based remunerationplans for remuneration of its employees. All employee services received in exchange for the grant of any share-basedremuneration are measured at their fair values. These are indirectly determinedby reference to the fair value of the share options awarded. Their value isappraised at the grant date and excludes the impact of any non-market vestingconditions (for example, profitability and sales growth targets). All share-based remuneration is ultimately recognised as an expense in profit orloss with a corresponding credit to the share based payment reserve, net ofdeferred tax where applicable. If vesting periods or other vesting conditionsapply, the expense is allocated over the vesting period, based on the bestavailable estimate of the number of share options expected to vest. Non-marketvesting conditions are included in assumptions about the number of options thatare expected to become exercisable. Estimates are subsequently revised, if thereis any indication that the number of share options expected to vest differs fromprevious estimates. No adjustment is made to the expense recognised in priorperiods if fewer share options ultimately are exercised than originallyestimated.Upon exercise of share options, the proceeds received net of any directlyattributable transaction costs up to the nominal value of the shares issued areallocated to share capital with any excess being recorded as share premium. This change in accounting policy has resulted in an increase to the loss beforetaxation of £74,000 for the 6 months ended 30 June 2005 and £232,000 for theyear ended 31 December 2005 respectively. This change has not resulted in anyincrease or decrease in net assets. In addition to those accounting policies adopted in the 2005 annual report andfinancial statements the following accounting policy has been added. Goodwill Goodwill arising on consolidation, representing the excess of the fair value ofthe consideration given over the fair values of the identifiable net assetsacquired, is capitalised and is amortised over twenty years on a straight linebasis. 2 LOSS PER SHARE The calculation of the basic and diluted loss per share is based on the loss onordinary activities after tax and on the weighted average number of ordinaryshares in issue during the period. The impact of the share options andconvertible debt are anti dilutive. The loss and weighted average number ofshares used in the calculations are set out below: Loss Weighted Loss average number per shareBasic loss per share of shares pence £'000 Six months ended 30 June 2006 (1,998) 24,756,811 (8.1) ------ ------------- ------- Six months ended 30 June 2005 - asrestated (3,649) 17,467,648 (20.9) ------- ------------- ------- Year ended 31 December 2005 - asrestated (5,662) 17,516,280 (32.3) ------- ------------- ------- 3 SHARE CAPITAL 6 months ended 6 months ended Year ended 30 June 30 June 31 December 2006 2005 2005 Unaudited Unaudited Audited £'000 £'000 £'000Authorised 45,000,000 ordinary shares of 1 penceeach 450 450 450 -------- -------- -------- Allotted, issued and fully paid 25,797,415 (2005 : 22,222,420)ordinary shares of 1 pence each 258 222 222 -------- -------- -------- On 7 February 2006, 2,811,816 ordinary shares were issued at a price of 220p pershare. On 8 February 2006, 388,184 ordinary shares were issued at a price of 220p pershare. On 28 June 2006, 374,995 ordinary shares were issued at a price of 200p pershare. 4 RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS 6 months ended 6 months ended Year ended 30 June 30 June 31 December 2006 2005 2005 As restated As restated Unaudited Unaudited Audited £'000 £'000 £'000 Loss for the financial period (1,998) (3,649) (5,662)Exchange difference onconsolidation 14 - -FRS 20 adjustment 170 74 232Issue of ordinary share capital 7,291 12,900 12,950 --------- --------- ---------Net increase in shareholders'funds 5,477 9,325 7,520 --------- --------- ---------Shareholders' funds/(deficit)at beginning 5,755 (1,765) (1,765)of period --------- --------- ---------Shareholders' funds at end ofperiod 11,232 7,560 5,755 --------- --------- --------- 5 NET CASH OUTFLOW FROM OPERATING ACTIVITIES 6 months ended 6 months ended Year ended 30 June 30 June 31 December 2006 2005 2005 As restated As restated Unaudited Unaudited Audited £'000 £'000 £'000 Operating loss (2,135) (3,686) (6,003)Depreciation 16 7 26Amortisation of goodwill 72 - -Amortisation of intangibles 40Exchange difference onconsolidation 14 - -FRS 20 adjustment 170 74 232Decrease in stock 25 - -Increase in debtors (341) (169) (252)Increase in creditors 130 351 572 --------- --------- ---------Net cash outflow fromoperating activities (2,009) (3,423) (5,425) --------- --------- --------- 6 RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET FUNDS/(DEBT) 6 months ended 6 months ended Year ended 30 June 30 June 31 December 2006 2005 2005 Unaudited Unaudited Audited £'000 £'000 £'000 Increase in cash in theperiod 360 7,840 6,164Cash inflow/(outflow) fromfinancing - 1,650 (2,050) ----------- ----------- -----------Change in net funds resultingfrom cash flows 360 9,490 4,114Non cash movements - (131) 3,569Loan note advanced onacquisition (815) - - ----------- ----------- -----------Movement in net funds/(debt) intheperiod (455) 9,359 7,683Net funds/(debt) at beginningof period 6,213 (1,470) (1,470) ----------- ----------- -----------Net funds at end of period 5,758 7,889 6,213 ----------- ----------- ----------- 7. ACQUISITIONS On 10 February 2006 the company acquired all of the ordinary shares in TimmMedical Technologies, Inc. for a consideration before professional costs of£5,389,000. Goodwill arising on the acquisition of £3,720,000 has beencapitalised. The assets and liabilities acquired were as follows: Book value Fair value £'000 £'000 ---------- ---------- Fixed assetsIntangible assets 2,102 2,102Tangible assets 41 41 Current assetsStocks and work in progress 271 271Debtors 340 340 CreditorsTrade creditors (183) (183)Accruals (469) (469) ---------- ----------Net assets acquired 2,102 2,102 ---------- ---------- £'000 ---------- Satisfied by: Cash 4,574Convertible loans 815Professional costs 433 ---------- 5,822 Net assets acquired 2,102 ----------Goodwill 3,720 ---------- Independent Review Report to Plethora Solutions Holdings plc Introduction We have been instructed by the Company to review the financial information forthe six months ended 30 June 2006 which comprises the Consolidated SummarisedProfit and Loss Account, Consolidated Summarised Balance Sheet, ConsolidatedSummarised Cash Flow Statement, the Consolidated Summarised Statement of TotalRecognised Gains and Losses and the related notes. We have read the otherinformation contained in the Interim Report which comprises only the Chairmanand Chief Executive's Statement and considered whether it contains any apparentmisstatements or material inconsistencies with the financial information. Ourresponsibilities do not extend to any other information. This report is made solely to the Company's members, as a body, in accordancewith guidance contained in APB Bulletin 1999/4 "Review of Interim FinancialInformation". Our review work has been undertaken so that we might state to theCompany's members those matters we are required to state to it in a reviewreport and for no other purpose. To the fullest extent permitted by law, we donot accept or assume responsibility to anyone other than the Company and theCompany's members as a body, for our review work, for this report or for theconclusion we have formed. Directors' responsibilities The Interim Report, including the financial information contained therein, isthe responsibility of and has been approved by the directors. The directors areresponsible for preparing the interim report in accordance with the ListingRules of the Financial Services Authority, which require that the accountingpolicies and presentation applied to the interim figures should be consistentwith those applied in preparing the preceding annual accounts except where anychanges, and the reasons for them, are disclosed. Review work performed We conducted our review in accordance with guidance contained in Bulletin 1999/4"Review of Interim Financial Information" issued by the Auditing Practices Boardfor use in the United Kingdom. A review consists principally of making enquiriesof management and applying analytical procedures to the financial informationand underlying financial data and, based thereon, assessing whether theaccounting policies and presentation have been consistently applied unlessotherwise disclosed. A review excludes audit procedures such as tests ofcontrols and verification of assets, liabilities and transactions. It issubstantially less in scope than an audit performed in accordance with UnitedKingdom auditing standards and therefore provides a lower level of assurancethan an audit. Accordingly, we do not express an audit opinion on the financialinformation. Review conclusion On the basis of our review we are not aware of any material modifications thatshould be made to the financial information as presented for the six monthsended 30 June 2006. GRANT THORNTON UK LLPChartered AccountantsBirmingham22 September 2006 This information is provided by RNS The company news service from the London Stock Exchange