PUR.L Regulatory News (PUR)

23 Feb 2005 07:01

Pure Wafer PLC23 February 2005 23 FEBRUARY 2005 PURE WAFER PLC ("Pure Wafer" or "the Company") Interim Results for 6 months ended 31 December 2004 Pure Wafer, which commenced trading in 2001, provides high quality silicon waferreclaim services for many of the world's leading semiconductor manufacturers.The use of test wafers is a vital part of the semiconductor manufacturingprocess and the reclaiming of these wafers represents a significant cost savingfor the industry. These are Pure Wafer's first financial results since theCompany listed on AIM in December 2004. HIGHLIGHTS Financial • Turnover of £3.98m, an increase of 107% over the corresponding 6 months ended 31 December 2003 and 41% higher than the 6 months ended 30 June 2004 • A first positive EBITDA of £373k (2003: EBITDA loss of £1.4 million) • Operating loss of £425k (2003: operating loss of £2.2 million) • Pre-tax loss of £480k (2003: pre-tax loss of £2.3 million) • Loss per share of 2.19p (2003: loss per share of 10.61p) • £5.7 million raised (net of expenses) in December 2004 through placing of shares on AIM Operational • Steady increase in volumes and orders from a broad international customer base • Investment in new plant and equipment: capacity expected to double from current levels by H2 2005 • Continued growth in the volume of 300mm wafers reclaimed, the fastest growing area of the wafer reclaim market: 3 times as many 300mm wafers reclaimed during the period as compared with a year ago • Ongoing qualification with several new potential customers who are some of the world's leading semiconductor manufacturers Keith Baker, Chief Executive of Pure Wafer, commented: "2005 has started satisfactorily and we are trading in line with expectations.The funds raised at flotation will support our capacity expansion plans,enabling us to meet the growing demand for our high quality wafer reclaimservices. The global demand for 300mm reclaim services is increasing in linewith industry forecasts. Despite predictions of a difficult year for thesemiconductor industry, we remain cautiously confident of our continued growthfor the rest of the financial year." ENQUIRIES Pure Wafer plc (www.purewafer.com) Tel. +44(0)1792 311 200Keith Baker, Chief ExecutivePeter Harrington, Finance Director ICIS Tel. +44 (0)20 7651 8688Archie BerensCaroline Evans-Jones NOTES FOR EDITORS About Wafer Reclaim During the many stages of the manufacturing process of semiconductors, largequantities of test wafers are used to check the accurate calibration ofequipment. Once used, these test wafers have no further use, unless they can bereclaimed. Reclaiming them for re-use thus represents a substantial cost savingfor semiconductor manufacturers. The semiconductor industry is currently seeing a rapid transition to 300mmwafers. In order for manufacturers to continue to increase functionality at areduced cost, the industry has sought to increase the size of wafers on whichsemiconductors are manufactured. 300mm wafer processing represents the fastestgrowing area of the semiconductor industry and the number of 300mm semiconductormanufacturing sites is expected to double by March 2006. However, wafer reclaim is a highly specialised and technically sophisticatedprocess. Only a few companies worldwide are able to meet the exacting standardsrequired by semiconductor manufacturers for the reclaim of 300mm wafers, ofwhich Pure Wafer is one. About Pure Wafer Pure Wafer provides high-quality silicon test wafer reclaim services to majorsemiconductor manufacturing companies around the world and is continuing toexpand its customer portfolio with continuing qualification processes. It is notitself a semiconductor manufacturer. Pure Wafer is one of only a small number of companies that currently providesilicon test wafer reclaim services worldwide which meet the stringent standardsrequired by semiconductor manufacturers for 300mm wafers, the largest and latestsize of silicon wafer. It was the first wafer reclaim company to build a bespoke300mm wafer reclaim processing plant. PURE WAFER PLC Interim Results for 6 months ended 31 December 2004 CHAIRMAN'S STATEMENT Introduction It gives me great pleasure to announce Pure Wafer's interim results for the 6months ended 31 December 2004. This is the first set of results published by theCompany since its successful flotation on AIM in December 2004. The flotationrepresented a crucial step in the Company's development, providing the necessaryfunding for a significant increase in operational capacity, with approximately£5.7 million raised for this purpose. This was to cater for a substantialincrease in demand for our high quality wafer reclaim services, particularly inthe increasingly important 300mm wafer market. Financial Results •In the six months to 31 December 2004, Pure Wafer achieved sales of £3.98 million, an increase of 107% compared to the corresponding period last year and 41% higher than the previous six months ended 30 June 2004. •Earnings before interest, tax, depreciation and amortisation (EBITDA) were £373,000, compared to an EBITDA loss of £1.4 million in the corresponding period in 2003 and an EBITDA loss of £14,000 for the six months ended 30 June 2004. •The operating loss for the period was £425,000 (2003: operating loss of £2.2 million). •Pre-tax losses were £480,000, compared to a pre-tax loss of £2.3 million for the 6 months ended 31 December 2003. •The loss per share for the period was 2.19p (2003: loss per share of 10.61p). The increase in sales is the direct result of the growth in demand for 300mmwafer reclaim products. In the 6 months ended 30 December 2004, Pure Waferreclaimed nearly 3 times as many 300mm wafers compared to the same period 1 yearago. In the period under review, not only have orders from existing customersincreased, but so too have orders from new customers, based across the world.This is testament to the quality of Pure Wafer's advanced wafer reclaim processdeveloped by the engineering team in house at the Company's state of the artfacility. Current Trading Since the Company's flotation at the end of 2004, trading has continued to besatisfactory and is in line with management expectations. In the short term, weexpect to have doubled capacity by the second half of 2005. Orders for reclaimservices continues to grow and our global customer base is continuing to expand.The Company has recently begun qualification programmes with several otherleading semiconductor manufacturers, who would be new customers. Outlook Many semiconductor industry analysts are forecasting that 2005 may be adifficult year for the industry and recent statements from some of the leadingmanufacturers appear to support this. However, despite a potential slowdown inthe wider industry in the short term, the Company is expecting to continue tomake good progress as semiconductor manufacturers take up the cost benefits of300mm manufacturing and additional cost savings presented through the use ofwafer reclaim services. The second half of the current financial year has begun satisfactorily. PureWafer continues to hold a good share of the growing wafer reclaim market. Inparticular, its capabilities in 300mm wafer reclaim, the fastest growing part ofthe wafer reclaim market, leave us well placed to build upon that position. Giles ClarkeChairman23 February 2005 PURE WAFER PLC Interim Results for 6 months ended 31 December 2004 Consolidated Profit & Loss Account 6 months ended 6 months ended Year ended 31 December 31 December 30 June 2004 2003 2004 (unaudited) (unaudited) (audited) Notes £000 £000 £000 Turnover 3,980 1,922 4,744 Cost of sales (2,815) (2,410) (4,757) ------------------- ---------- ---------- --------- Gross profit/(loss) 1,165 (488) (13) Operating charges (1,590) (1,725) (3,021) ------------------- ---------- ---------- --------- 2 Operating loss for (425) (2,213) (3,034) the period Net interest payable (55) (86) (167) ------------------- ---------- ---------- --------- Loss before taxation (480) (2,299) (3,201) 3 Taxation - - - ------------------- ---------- ---------- --------- Loss after taxation (480) (2,299) (3,201) ------------------- ---------- ---------- --------- 4 Loss per ordinary (2.19) (10.61) (14.77) share (pence) ------------------- ---------- ---------- --------- All activities above relate to the continuing operations of the group. There are no other gains and losses for the period other than the loss for theperiod shown above and, accordingly, a separate statement of recognised gainsand losses has not been presented. PURE WAFER PLC Interim Results for 6 months ended 31 December 2004 Consolidated Balance Sheet 31 December 31 December 30 June 2004 2003 2004 (unaudited) (unaudited) (audited) Notes £000 £000 £000 Fixed assets Tangible assets 15,598 17,285 16,366 ------------------- ---------- ---------- --------- Current assets Stocks and work in 293 292 326 progress Debtors 2,342 1,050 1,710 Cash at bank and in 6,993 113 621 hand ------------------- ---------- ---------- --------- 9,628 1,455 2,657 Creditors: due within one (2,534) (3,480) (1,529) year ------------------- ---------- ---------- --------- Net current assets 7,094 (2,025) 1,128 ------------------- ---------- ---------- --------- Total assets less current 22,692 15,260 17,494 liabilities Creditors: due after more (16) (6,361) (6,643) than one year Accruals and deferred (3,435) (3,727) (3,581) income ------------------- ---------- ---------- --------- Net assets 19,241 5,172 7,270 ------------------- ---------- ---------- --------- Share capital 530 133 26,865 Shares to be issued - 26,815 - Share premium 12,644 1,200 4,283 Other reserves 30,425 - - Profit and loss account (24,358) (22,976) (23,878) ------------------- ---------- ---------- --------- 6 Equity shareholders' 19,241 5,172 7,270 funds ------------------- ---------- ---------- --------- PURE WAFER PLC Interim Results for 6 months ended 31 December 2004 Consolidated Cash flow Statement 6 months ended 6 months ended Year ended 31 December 31 December 30 June 2004 2003 2004 (unaudited) (unaudited) (audited) £000 £000 £000 Net cashinflow/(outflow) fromoperating activities 781 (1,827) (2,480)----------------------- ---------- ---------- ---------Return on investmentsand servicing of finance:Interest received 21 - 5----------------------- ---------- ---------- ---------Capital expenditure andfinancial investmentPurchase of tangible fixedassets (178) (52) (66)----------------------- ---------- ---------- ---------Cash inflow/(outflow) before financing 624 (1,879) (2,541)----------------------- ---------- ---------- ---------FinancingFunds received in relation toordinary shares (net of issue costs) 5,753 1,500 2,500Debenture finance receive - 275 450Repayment of finance leases (5) - (5)----------------------- ---------- ---------- ---------Net cash inflow fromfinancing 5,748 1,775 2,945----------------------- ---------- ---------- ---------Increase/(decrease) in cashin the period 6,372 (104) 404----------------------- ---------- ---------- --------- Reconciliation of operating loss to net cash flow from operating activities 6 months ended 6 months ended Year ended 31 December 31 December 30 June 2004 2003 2004 (unaudited) (unaudited) (audited) £000 £000 £000Continuing activitiesOperating loss (425) (2,213) (3,034)Depreciation charge 944 948 1,902Release of deferred income (146) (152) (298)Decrease in stock 33 155 121(Increase) in debtors (632) (510) (1,170)Increase/(decrease) increditors 1,007 (55) (1)------------------ ---------- ---------- ----------Net cash inflow/(outflow) fromoperating activities 781 (1,827) (2,480)------------------ ---------- ---------- ---------- PURE WAFER PLC Interim Results for 6 months ended 31 December 2004 Notes to Financial Statements 1 Basis of preparation The interim report has been prepared using accounting policies that have beenconsistently applied and are those used in the preparation of the financialstatements for the period ended 30 June 2004 of Pure Wafer International Limited(formerly Pure Wafer Limited). The group accounts of Pure Wafer plc (formerly Pure Wafer International plc)comprise the consolidation of the accounts of the company and its subsidiaryundertaking after eliminating inter company balances and transactions. Merger accounting has been applied to the reconstruction of the group that tookplace during the year. In consequence, the results for the period are presentedas if the Pure Wafer plc group had existed and traded in its present form forthe entire period. The comparative data in these interim financial statements are the auditedfinancial statements for the year ended 30 June 2004 and the unauditedmanagement accounts for the six months ended 31 December 2003 of Pure WaferInternational Limited (formerly Pure Wafer Limited). The financial information contained in this interim announcement does notconstitute statutory accounts within the meaning S240 of the Companies Act 1985.The interim results, which have not been audited but have been reviewed by thecompany's auditors, have been prepared on the basis of the accounting policiesadopted by Pure Wafer International Limited for the year ended 30 June 2004 asset out in the Annual Report and Accounts. Those accounts (on which the auditorgave an unqualified report) have been delivered to the Registrar of Companies. 2 Reconciliation of operating loss for the year to EBITDA 6 months ended 6 months ended Year ended 31 December 31 December 30 June 2004 2003 2004 (audited) (unaudited) (unaudited) £000 £000 £000 Operating loss for the period (425) (2,213) (3,034)Depreciation 944 948 1,902Release of deferredcapital grant (146) (152) (298)------------------ ---------- ---------- --------Earnings/(loss) beforeinterest, tax,depreciationand amortisation 373 (1,417) (1,430)------------------ ---------- ---------- -------- 3 Taxation The company has approximately £28.1m (June 2004: £28.7m; December 2003: £26.9m)of taxation losses carried forward. Of this amount, £5.7m (June 2004: £6.6m,December 2003: £5.9m) has been used to eliminate the requirement for a deferredtax liability. There is no tax charge for the period ended 31st December 2004(June 2004: £nil; December 2003: £nil) 4 Loss per share Loss per share attributable to ordinary shares has been calculated as follows: 6 months ended 6 months ended Year ended 31 December 31 December 30 June 2004 2003 2004 (unaudited) (unaudited) (unaudited) '000 '000 '000 Loss for the period £(480) £(2,299) £(3,201)----------------- ---------- ---------- ---------Weighted average numberof ordinary shares inissue 21,955 21,667 21,667----------------- ---------- ---------- --------- 5 Analysis of net (debt)/cash 31 December 31 December 30 June 2004 2003 2004 (unaudited) (audited) (unaudited) £000 £000 £000 Cash at bank and in hand 6,993 113 621------------------ ---------- ---------- --------Debentures - (2,275) (2,450)Mortgage - (2,000) (2,000)Other loans - (2,000) (2,000)Finance leases (25) - (30)------------------ ---------- ---------- -------- (25) (6,275) (6,480)------------------ ---------- ---------- --------Net cash/(debt) 6,968 (6,162) (5,859)------------------ ---------- ---------- -------- 6 Movement in equity shareholders' funds 6 months ended 6 months ended Year ended 31 December 31 December 30 June 2004 2003 2004 (unaudited) (unaudited) (audited) £000 £000 £000 At the beginning of the period in Pure Wafer International Limited 7,270 7,471 7,471Issue of new shares 7,000 - 3,000Expenses incurred on the issue of new shares (1,247) - -Conversion of debt andaccrued interest to equity 6,698 - ------------------- ----------- ---------- -------- 19,721 7,471 10,471Loss for the period (480) (2,299) (3,201)------------------ ----------- ---------- --------At the end of the period inPure Wafer plc (consolidated) 19,241 5,172 7,270------------------ ----------- --------- -------- 7 Circulation A copy of this announcement is available from the Company Secretary, CentralBusiness Park, Swansea Vale, Swansea, SA7 0AB. Independent review report to Pure Wafer plc Introduction We have been instructed by the company to review the financial information whichcomprises the consolidated profit and loss account, consolidated balance sheet,consolidated cash flow statement and the related notes. We have read the otherinformation contained in the interim report and considered whether it containsany apparent misstatements or material inconsistencies with the financialinformation. 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 1999/4issued by the Auditing Practices Board for use in the United Kingdom. A reviewconsists principally of making enquiries of group management and applyinganalytical procedures to the financial information and underlying financial dataand, based thereon, assessing whether the accounting policies and presentationhave been consistently applied unless otherwise disclosed. A review excludesaudit procedures such as tests of controls and verification of assets,liabilities and transactions. It is substantially less in scope than an auditperformed in accordance with United Kingdom Auditing Standards and thereforeprovides a lower level of assurance than an audit. Accordingly we do not expressan audit opinion on the financial information. This report, including theconclusion, has been prepared for and only for the company for the purpose ofthe Listing Rules of the Financial Services Authority and for no other purpose.We do not, in producing this report, accept or assume responsibility for anyother purpose or to any other person to whom this report is shown or into whosehands it may come save where expressly agreed by our prior consent in writing. 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 31 December 2004. PricewaterhouseCoopers LLPChartered AccountantsSwansea, 23 February 2005 Notes: (a) The maintenance and integrity of the Pure Wafer plc websiteis the responsibility of the directors; the work carried out by the auditorsdoes not involve consideration of these matters and, accordingly, the auditorsaccept no responsibility for any changes that may have occurred to the interimreport since it was initially presented on the website. (b) Legislation in the United Kingdom governing the preparation anddissemination of financial information may differ from legislation in otherjurisdictions. This information is provided by RNS The company news service from the London Stock Exchange