Ross Grp. Regulatory News (RGP)

25 Sep 2006 09:59

Ross Group PLC25 September 2006 Ross Group plc Released 25 September 2006 INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2006 Chairman's statement The result for the Group for the six months ended 30 June 2006 was an operatingloss of £541,000 before tax (June 2005 loss £336,000). Whilst this result isextremely disappointing there are encouraging signs of a potential recoverywhich indicate that 2007 should see a much improved result. Business review The engineering activities operated through GEL Engineering Ltd (GEL) have seena slow start to 2006 as the company was waiting for some budgeted large ordersto be awarded. The first half of the year saw activities restricted to containerwork and the completion of three test rigs which were technically challenging.The company has received a subcontract award of 40% of a repeat order for a highfidelity Hercules Loadmaster trainer. Full contract award (USD 2.4m) is expectedshortly. GEL is also close to being awarded an export vehicle supply contractfor North Africa, pending the issue of an export licence, worth around £830,000for delivery in Q2 2007. These two contracts will contribute towards a risingoutput figure in Q4 2006, but the major flow of gross margin from these projectswill be in 2007. The company is concentrating on raising the quality of salesenquiries to target the effort in areas that will give maximum rewards. Sansui Electronics (UK) Ltd (Sansui) has seen a small number of sales in thehalf year under review. These are from stock of electronic consumer productacquired from an associated company. It is intended for the company to makefurther use of this relationship and grow the sales by expanding the range ofavailable products and increased market awareness. These products have beendisplayed at the prestigious Berlin trade fair in September 2006. The Directors continue to pursue the development of other opportunities for theGroup with a view to bringing new activities into the business profile. Thefirst serious proposal was rejected by the UKLA, but the Directors are confidentthat a suitable package of potential opportunities will be put together to allowthe re-generation of the Group. Business Outlook The output derived from the recent sales orders will not be sufficient to turnthe half year loss into a full year profit. However the increase in value of thesales order book carried into 2007 should, combined with the activities ofSansui, push the Group back in to profit. This could be enhanced further by thepotential significant changes in the structure and operation of the Group. Dividend No ordinary interim dividend is proposed after considering the result for thefirst half of the year, and the continuing deficiency on retained reserves (2005- £Nil). A C C Ma Chairman Approved 21 September 2006 GROUP INCOME STATEMENT UNAUDITED 6 Months 6 Months Year Ended Ended Ended 30 June 30 June 31 December 2006 2005 2005 £'000 £'000 £'000Group RevenueContinuing Operations 592 255 581 Operating (Loss)Continuing Operations (404) (336) (1,146) (Loss) Before Finance Cost (404) (336) (1,146) Finance Cost (137) (129) (362) (Loss) Before Taxation (541) (465) (1,508) Taxation 0 0 0 (Loss) For The Period (541) (465) (1,508) Earnings Per Share (pence) (0.39) (0.34) (1.11)Adjusted Earnings Per Share (pence) (0.39) (0.34) (1.11) GROUP BALANCE SHEET UNAUDITED 30 June 30 June 31 December 2006 2005 2005 £'000 £'000 £'000 Non Current Assets 21 35 28 Current AssetsInventories 388 199 644Trade and Other Receivables 404 556 591Cash and Cash Equivalents 99 11 7 -------- -------- -------- 891 766 1,242 -------- -------- --------Total Assets 912 801 1,270 -------- -------- -------- Equity and LiabilitiesShareholders' EquityShare Capital 11,136 11,136 11,136Share Premium Account 2,317 2,317 2,317Other Reserves 15,387 15,391 15,388Retained Earnings (33,203) (31,626) (32,663) -------- -------- --------Total Equity (4,363) (2,782) (3,822) Non-Current LiabilitiesLong Term Borrowings (Group) 0 2,374 0 Current LiabilitiesTrade and Other Payables 5,275 659 5,089Bank Overdraft and Loans 0 550 3 -------- -------- -------- 5,275 1,209 5,092 Total Liabilities 5,275 3,583 5,092 -------- -------- --------Total Equity and Liabilities 912 801 1,270 -------- -------- -------- GROUP CASH FLOW STATEMENT UNAUDITED 6 Months 6 Months Year Ended Ended Ended 30 June 2006 30 June 2005 31Dec. 2005 £'000 £'000 £'000Net Cash (Used in) OperatingActivities 96 (249) 0 Cash Flows From Investing ActivitiesPurchase Of Plant and Machinery (1) (2) (6) --------- --------- ---------Net Cash Used In InvestingActivities (1) (2) (6) Cash Flows From Financing ActivitiesNet Increase In Borrowings 0 250 0Repayment of Capital Element ofFinance Lease 0 0 (2) --------- --------- ---------Net Cash Flow Used In FinancingActivities 0 250 (2) --------- --------- ---------Net Increase/(Decrease) In CashAnd Cash Equivalents 95 (1) (8) Cash and Cash Equivalents atbeginning of Period 4 12 12 --------- --------- ---------Cash and Cash Equivalents at endof Period 99 11 4 ========= ========= ========= Notes to the Interim Report (1) The interim financial statements have been prepared on the basis of theaccounting policies set out in the audited statutory accounts for the year ended31 December 2005. The financial information contained in these statements for the six months ended30 June 2006 and 30 June 2005 is unaudited and does not constitute statutoryaccounts as defined in section 240 of the Companies Act 1985. (2) Reconciliation of Operating Loss to Net Cash Flows From Operating Activities 6 Months 6 Months Year Ended Ended Ended 30 June 2006 30 June 2005 31Dec. 2005 £'000 £'000 £'000Operating (Loss) On ContinuingActivities (541) (465) (1,508)Depreciation And Amortisation 8 12 23Decrease/(Increase) In Inventories 256 183 (262)Decrease/(Increase) In Trade AndOther Receivables 187 196 161(Decrease) In Trade And OtherPayables 186 (175) 1,586 --------- --------- -------- Cash Generated From Operations 96 (249) 0 ========= ========= ======== (3) No ordinary interim dividend is proposed for 2006 (2005-£nil). Notes to the Interim Report (Continued) (4) The comparative cash flow for the year ended 31 December 2005 has beenextracted from the audited accounts. The cash flows for the six months ended 30June 2006 and 30 June 2005 are unaudited. (5) Reconciliation of Movements In Equity 6 Months 6 Months Year Ended Ended Ended 30 June 2006 30 June 2005 31 Dec 2005 £'000 £'000 £'000Share premium Account - BroughtForward 2,317 2,317 2,317Movement 0 0 0Carried Forward 2,317 2,317 2,317 Other Reserves - Brought Forward 15,388 15,394 15,394(Depreciation) (1) (3) (6)Carried Forward 15,387 15,391 15,388 Retained Earnings - BroughtForward (32,663) (31,164) (31,164)(Loss) for Period (541) (465) (1,508)Profit on Translation ofSubsidiary 0 0 3Transfer from Revaluation Reserve 1 3 6Carried Forward (33,203) (31,626) (32,663) (6) The Group is supported by short term borrowings from it's largershareholders by way of formal agreements. At 30 June 2006 total borrowings fromKeniworth Capital Ltd were £4,132k and £91k from The Grande Group and itssubsidiary companies. Keniworth Capital Ltd hold 29% of the issued ordinaryshare capital and The Grande Holding Ltd has direct or indirect control of 43%. (7) These Statements are prepared in accordance with InternationalFinancial Reporting Standards (IFRS) as adopted for use in the EU. (8) The Interim Report will be sent by mail to all registered shareholdersand copies will be available from the Company's head office at Ross Group PLC,Brunel Road, Totton, Hampshire, SO40 3YS. A downloadable copy will also beposted on the Company's website www.ross-group.co.uk Ross Group plc Registered Office 35 Paul Street London EC2A 4UQ Contact - P. Elliott, Executive Director Tel. - 02380 675500 Fax - 02380 675555 Email - p.elliott@ross-group.co.uk Website - www.ross-group.co.uk This information is provided by RNS The company news service from the London Stock Exchange