Stratmin Global Resources Regulatory News (STGR)

11 Sep 2006 17:50

Interactive Prospect TargetingHdgs11 September 2006 Interactive Prospect Targeting Holdings plc Restatement of financial information for the year ended 31 December 2005 under International Financial Reporting Standards ("IFRS") Introduction Interactive Prospect Targeting Holdings plc has adopted International FinancialReporting Standards (IFRS) issued by the International Accounting StandardsBoard (IASB) with effect from 1 January 2006. The first full-year reportingperiod will be for the year ending 31 December 2006. The first results to beprepared by the Group under IFRS will be the announcement of interim results forthe six-month period ended 30 June 2006. The financial results of the Group previously published for the year ended 31December 2005 and for the six months ended 30 June 2005 were prepared underUnited Kingdom Generally Accepted Accounting Practice (UK GAAP). These resultshave been restated in accordance with IFRS. The restated information will beincluded as non-statutory comparative information in the interim results for thesix months ended 30 June 2006. The purpose of this document is to: • provide an overview of the impact of IFRS; • summarise the basis of preparation of financial information restated under IFRS; • describe the principal differences between UK GAAP and IFRS that impact the Group; • detail the significant accounting policies of the Group under IFRS; and • provide a reconciliation of financial information restated for IFRS to that previously reported under UK GAAP. Overview of impact of IFRS Whilst the introduction of IFRS has no impact on the underlying cash flows ofthe business, the areas of accounting that will have the most significant impacton the Group's financial statements are as follows: • The treatment of goodwill • The recognition of other intangibles on acquisition, and their subsequent amortisation • Employee share based payment arrangements • Other employee benefits - compensated absences • Income tax deduction for share options exercised • Reclassification of software from property, plant and equipment to intangible assets • Revaluation of assets held for sale to market value at balance sheet date • Deferred tax The following table summarises the impact of the adoption of IFRS on the Group'sprofit after tax for the 6 months ended 30 June 2005 and year ended 31 December2005. Reconciliation of profit for the period 6 months Year 6 months Year ended ended ended ended 30 June 2005 31 December 30 June 31 December 2005 2005 2005 £'000 £'000 Basic EPS Profit after tax under UK GAAP 926 2,312 3.0p 7.2p IFRS adjustmentsGoodwill amortisation 2 118 - 0.4pOther intangibles amortisation - (36) - (0.1p)Share based payments (15) (37) - (0.1p) Employee benefits: compensated absences 23 (21) - (0.1p) Profit on disposal of available for sale (152) (218) (0.5p) (0.7p)investmentsReclassification of income tax deduction to equity - (525) - (1.7p)Deferred taxation 149 246 0.5p 0.8p 7 (473) - (1.5p) Profit after tax under IFRS 933 1,839 3.0p 5.7p See comments on pages 3 to 4 for explanation of the transition adjustments toIFRS. Basis of preparation General For the year ended 31 December 2006, the Group will prepare consolidatedfinancial statements under IFRS as adopted by the European Commission. Thesewill be those International Accounting Standards, International FinancialReporting Standards and related interpretations (SIC-IFRIC interpretations),subsequent amendments to those standards and related interpretations, futurestandards and related interpretations issued or adopted by the IASB that havebeen endorsed by the European Commission. This process is ongoing and theCommission has yet to endorse certain standards issued by the IASB. The preliminary restated financial information has been prepared by managementusing its best knowledge of the expected standards and interpretations of theIASB, facts and circumstances, and accounting policies that will be applied whenthe Group prepares its first complete set of IFRS financial statements as at 31December 2006. Therefore, until such time, the possibility cannot be excludedthat the accompanying preliminary restated financial information may requireadjustment before constituting the final restated financial information.Moreover, under IFRS, only a complete set of financial statements comprising abalance sheet, income statement, statement of changes in equity, cash flowstatement, together with comparative financial information and explanatorynotes, can provide a fair presentation of the Group's financial position,results of operations and cash flow. First time adoption exemptions The requirements for the first time adoption of IFRS are set out in IFRS 1 FirstTime Adoption of International Financial Reporting Standards. Generally, IFRS 1requires that accounting policies be adopted that are compliant with IFRS andthat these policies be applied retrospectively to all periods presented.However, under IFRS 1, a number of exemptions are permitted to be taken inpreparing the balance sheet as at the date of transition to IFRS on 1 January2005. The exemptions which the Group has taken advantage of are explained below: o The Group has elected not to apply IFRS 3 Business Combinations to business combinations that took place before 1 January 2005. o The Group has elected not to apply the provisions of IFRS 2 Share-based Payment to options and awards that were granted on or before 7 November 2002 or which had vested by 1 January 2005. o The Group has elected to designate shares held in companies that are not part of the Group as available for sale under IAS39 Financial Instruments: recognition and measurement. Principal differences between UK GAAP and IFRS that impact the Group The appendix to this report reconciles the results and net assets of the Groupas reported under UK GAAP to the information restated under IFRS. The principaldifferences between UK GAAP and IFRS as shown in the appendix are describedbelow. Share-based payment Under UK GAAP, the charges for the Group's share option schemes are based on thedifference between the market price of the share on the date of the grant andthe exercise price to be paid. As all option prices equated to the market priceat the date of the grant, no charge was required in the income statement. IFRS 2 Share-based payment requires the fair value of the awards to becalculated. This fair value is assessed at the date of the grant and isrecognised over the vesting period. As a result, a charge of £15,000 for share-based payments has been recognisedwithin administrative expenses for the six months ended 30 June 2005. Similarly,the charge recognised for the year ended 31 December 2005 was £37,000. Goodwill Goodwill arising on business combinations Under UK GAAP, the difference between the consideration paid for an acquisitionand the fair value of the net assets acquired was recognised as goodwill. IFRS 3requires that the intangible assets of an acquired business are recognisedseparately from goodwill and are then amortised over their useful lives. Under the IFRS 1 transition rules, the Group has elected not to identify anyacquired intangible assets for acquisitions made before 1 January 2005. The Postal Preference Service Limited (PPS) was acquired by the Group in August2005 giving rise to goodwill on acquisition of £2,928,000 under UK GAAP. Inapplying IFRS 3 the Group has reclassified intangible assets arising onacquisition of £766,000 out of goodwill, representing the values placed on thePPS trade name and customer relationships. Amortisation charged on theseintangible assets of £37,000 was recognised from the date of acquisition to 31December 2005. Goodwill amortisation Under UK GAAP, goodwill arising from business combinations was amortised overits estimated useful economic life. IFRS 3 Business combinations prohibits the amortisation of goodwill, insteadrequiring the goodwill to be tested for impairment. As a result, amortisation of goodwill resulting from the acquisition ofNewsletters Online Limited of £2,000 for the six months ended 30 June 2005 and£5,000 for the year ended 31 December 2005 has been released to the incomestatement. Similarly the amortisation of goodwill resulting from the acquisition of ThePostal Preference Service Limited is decreased by £114,000 for the period fromdate of acquisition to 31 December 2005. Employee benefits: compensated absences Under UK GAAP, the Group made no accrual for compensated absences. Under IAS 19Employee benefits, the expected costs of short-term accumulating compensatedabsences are accrued as earned by employees. At the transition date of 1 January 2005, the balance sheet has been adjusted toreflect liabilities not recognised under UK GAAP in respect of these compensatedabsences of £52,000. In the six months to 30 June 2005, due to a reversal ofpreviously accrued costs, a credit of £23,000 was recorded within expenses.However, in the year ended 31 December 2005, an increase in the accrued costsresults in an additional cost of £21,000 since 1 January 2005. Software licences Under UK GAAP, Software licences were capitalised as property, plant andequipment as part of computer equipment and depreciated over their usefuleconomic life. Under IFRS, IAS38 requires that software licences, which are notan integral part of the related hardware, are capitalized as an intangible assetand amortised over their useful economic life. The impact of this change was to reclassify such software licenses which do notform the integral part of the hardware, such as the operating system, fromproperty, plant and equipment to intangible assets. The related depreciation wasreclassified to amortisation expense in the income statement. The amountstransferred were £72,000 as at 1 January 2005, £66,000 as at 30 June 2005 and£307,000 as at 31 December 2005.The net impact on the income statement is £nil. Assets held for sale Under UK GAAP, assets held for sale were stated at cost. Under IFRS assets heldfor sale are measured at fair value, with fair value gains or losses recogniseddirectly in equity, and recycled into the income statement on sale or impairmentof the asset at which time the cumulative gain or loss previously recognised inequity is recognised in profit or loss for the period. The impact of this change is to revalue assets held for sale at 1 January 2005at their market value of £673,000, where previously they had been stated at costof £30,000. The difference of £643,000 was taken to revaluation reserve. Adeferred tax liability of £193,000 was also recognized on the revaluationreserve at that date. At 30 June 2005, after the disposal of some of these assets, the market value ofremaining assets was £186,000 and the resulting revaluation reserve was£117,000. The net impact on the income statement is £nil. Taxation Income tax deduction for share options exercised Under UK GAAP, the Group recognised an income tax deduction for the excess ofmarket value of share options over their exercise price when share options wereexercised. IAS 12 Income Taxes requires deferred tax to be calculated based upon the numberof share options outstanding at the balance sheet date by reference to thedifference between the grant price and the market value of the shares at thatdate. Changes to the amount of deferred tax in excess of the charge reported inthe income statement are recognised in equity not in income tax. The impact of this change was to reclassify a tax deduction of £525,000 in theyear ended 31 December 2005 from income tax to equity. The net impact on theincome statement is £525,000. Deferred tax Deferred tax was recognised in respect of all timing differences, with a fewexceptions that have originated but not reversed at the balance sheet date.Timing differences arise when the profit or loss is recognised in a differentperiod in the tax computation from that in the financial statements. Under IFRS the Group is required to adopt a balance sheet approach under whichtemporary differences are identified for each asset and liability rather thanaccounting for the effects of timing and permanent differences between taxableand accounting profit. The impact of this is to recognise deferred tax on the estimated future taxdeduction arising in relation to the exercise of UK employee share options andadjustments to qualifying goodwill, holiday pay liabilities and intangibleassets and the related amortisation, following the different accountingtreatment of these items under IFRS. At 31 December 2005 a deferred tax asset of £341,000 was reported in the UK GAAPbalance sheet. The IFRS balance sheet at that date includes a deferred tax assetof £1,139,000 (the increase mainly arising as a result of the deferred tax asseton share options) and a deferred tax liability of £219,000 (arising as a resultof the recognition of intangible assets on the PPS acquisition in accordancewith IFRS 3). Deferred tax adjustments arising on the transition to IFRS havebeen offset only to the extent that this offset is permitted under IAS 12. There is also a presentational change that includes classifying deferred taxliabilities and assets as non-current and reporting them separately on the faceof the balance sheet. Cash flows There are no material differences between the cash flow statement prepared underUK GAAP and that prepared under IFRS for each of the periods presented, otherthan presentational changes. Significant accounting policies Basis of accounting The financial statements have been prepared in accordance with InternationalFinancial Reporting Standards for the first time, with a transition date of 1January 2005. The financial statements have also been prepared in accordancewith IFRS adopted for use in the European Union and therefore comply withArticle 4 of the EU IAS Regulation. The financial statements have been prepared on the historical cost basis. Theprincipal accounting policies adopted are set out below. Basis of consolidation The Group's consolidated financial statements incorporate the financialstatements of Interactive Prospect Targeting Holdings plc ('the Company') andentities controlled by the Company (its 'subsidiaries'). Control is achievedwhere the Company has the power to govern the financial and operating policiesof an investee entity so as to obtain benefits from its activities. The results of subsidiaries acquired or disposed of during the year are includedin the consolidated income statement from the effective date of acquisition orup to the effective date of disposal, as appropriate. Where necessary, adjustments are made to the financial statements ofsubsidiaries to bring the accounting policies used into line with those used bythe Group. All intra-Group transactions, balances, income and expenses are eliminated onconsolidation. Business combinations The acquisition of subsidiaries is accounted for using the purchase method. Thecost of the acquisition is measured at the aggregate of the fair values, at thedate of exchange, of assets given, liabilities incurred or assumed, and equityinstruments issued by the Group in exchange for control of the acquiree, plusany costs directly attributable to the business combination. The acquiree'sidentifiable assets, liabilities and contingent liabilities that meet theconditions for recognition under IFRS 3 are recognised at their fair value atthe acquisition date, except for non-current assets that are classified as heldfor resale in accordance with IFRS 5 Non-current assets held for sale anddiscontinued operations, which are recognised and measured at fair value lesscosts to sell. Goodwill arising on acquisition is recognised as an asset and initially measuredat cost, being the excess of the cost of the business combination over theGroup's interest in the net fair value of the identifiable assets, liabilitiesand contingent liabilities recognised. If, after reassessment, the Group'sinterest in the net fair value of the acquiree's identifiable assets,liabilities and contingent liabilities exceed the cost of the businesscombination, the excess is recognised immediately in profit or loss. Non-current assets held for sale Non-current assets classified as held for sale are measured at the lower ofcarrying amount and fair value less costs to sell. Goodwill Goodwill arising on consolidation represents the excess of the cost ofacquisition over the Group's interest in the fair value of the identifiableassets and liabilities of a subsidiary, associate or jointly controlled entityat the date of acquisition. Goodwill is initially recognised as an asset atcost and is subsequently measured at cost less any accumulated impairmentlosses. Goodwill, which is recognised as an asset, is reviewed for impairmentat least annually. Any impairment is recognised immediately in profit or lossand is not subsequently reversed. For the purpose of impairment testing, goodwill is allocated to each of theGroup's cash-generating units expected to benefit from the synergies of thecombination. Cash-generating units to which goodwill has been allocated aretested for impairment annually, or more frequently when there is an indicationthat the unit may be impaired. If the recoverable amount of the cash-generatingunit is less than the carrying amount of the unit, the impairment loss isallocated first to reduce the carrying amount of any goodwill allocated to theunit and then to the other assets of the unit pro-rata on the basis of thecarrying amount of each asset in the unit. An impairment loss recognised forgoodwill is not reversed in a subsequent period. On disposal of a subsidiary, associate or jointly controlled entity, theattributable amount of goodwill is included in the determination of the profitor loss on disposal. Goodwill arising on acquisitions before the date of transition to IFRS has beenretained at the previous UK GAAP amounts subject to being tested for impairmentat that date. Other intangible assets Other intangible assets are held at cost less accumulated amortisation and anyrecognised impairment loss. Amortisation is charged so as to write off the cost of assets, less theirestimated residual value, on a straight-line basis over their estimated usefullives as follows: Data acquisition costs 3 yearsLicences 1-5 yearsCapitalised computer software 2 years Property, plant and equipment Property, plant and equipment are stated at cost, net of depreciation and anyrecognised impairment loss. Depreciation is charged so as to write off the cost or valuation of assets, overthe estimated useful lives, using the straight-line method, on the followingbases: Computer equipment 33% on costFixtures and fittings 20% on cost Assets held under finance leases are depreciated over their expected usefullives on the same basis as owned assets or, where shorter, over the term of therelevant lease. Internally-generated intangible assets - research and development expenditure Expenditure on research activities is recognised as an expense in the period inwhich it is incurred. An internally-generated intangible asset arising from the Group's websitedevelopments is recognised only if all of the following conditions are met: • an asset is created that can be identified (such as software and new processes); • it is probable that the asset created will generate future economic benefits; and • the development costs of the asset can be measured reliably. Internally-generated intangible assets are amortised on a straight-line basisover their useful lives. Where no internally-generated intangible asset can berecognised, development expenditure is recognised as an expense in the period inwhich it is incurred. Leases Leases are classified as finance leases whenever the terms of the lease transfersubstantially all the risks and rewards of ownership to the lessee. All otherleases are classified as operating leases. Assets held under finance leases are recognised as assets of the Group at theirfair value or, if lower, at the present value of the minimum lease payments,each determined at the inception of the lease. The corresponding liability tothe lessor is included in the balance sheet as a finance lease obligation.Lease payments are apportioned between finance charges and reduction of thelease obligation so as to achieve a constant rate of interest on the remainingbalance of the liability. Finance charges are charged directly against income. Rentals payable under operating leases are charged to income on a straight-linebasis over the term of the relevant lease. Benefits received and receivable asan incentive to enter into an operating lease are also spread on a straight linebasis over the lease term. Pension costs The Group does not operate any pension plans, but does administer a stakeholderpension scheme on behalf of any employees wishing to participate. Revenue recognition Revenue is measured at the fair value of the consideration received orreceivable and represents amounts receivable for goods and services provided inthe normal course of business, net of discounts, VAT and other sales relatedtaxes. Sales of goods are recognised when goods are delivered and title has passed.Sales of services are recognised with reference to the stage of completion. Foreign currencies The individual financial statements of each Group company are presented in thecurrency of the primary economic environment in which it operates (itsfunctional currency). For the purpose of the consolidated financial statements,the results and financial position of each Group company are expressed in poundssterling, which is the functional currency of the Company, and the presentationcurrency for the consolidated financial statements. In preparing the financial statement of the individual companies, transactionsin currencies other than the entity's functional currency (foreign currencies)are recorded at the rates of exchange prevailing on the dates of thetransactions. At each balance sheet date, monetary assets and liabilities thatare denominated in foreign currencies are retranslated at the rates prevailingon the balance sheet date. Non-monetary items carried at fair value that aredenominated in foreign currencies are translated at the rates prevailing at thedate when the fair value was determined. Non-monetary items that are measuredin terms of historical cost in a foreign currency are not retranslated. Exchange differences arising on the settlement of monetary items, and on theretranslation of monetary items, are included in profit or loss for the period.Exchange differences arising on the retranslation of non-monetary items carriedat fair value are included in profit or loss for the period except fordifferences arising on the retranslation of non-monetary items in respect ofwhich gains and losses are recognised directly in equity. For such non-monetaryitems, any exchange component of that gain or loss is also recognised directlyin equity. For the purpose of presenting consolidated financial statements, the assets andliabilities of the Group's foreign operations are translated at exchange ratesprevailing on the balance sheet date. Income and expense items are translatedat the average exchange rates for the period. Exchange differences arising areclassified as equity and transferred to the Group's translation reserve. Suchtranslation differences are recognised as income or as expenses in the period inwhich the operation is disposed of. Goodwill and fair value adjustments arising on the acquisition of a foreignentity are treated as assets and liabilities of the foreign entity andtranslated at the closing rate. Operating profit Operating profit is stated after charging restructuring costs but beforeinvestment income and finance costs. Taxation The tax expense represents the sum of the tax currently payable and deferredtax. The tax currently payable is based on taxable profit for the year. Taxableprofit differs from net profit as reported in the income statement because itexcludes items of income or expense that are taxable or deductible in otheryears and it further excludes items that are never taxable or deductible. TheGroup's liability for current tax is calculated using tax rates that have beenenacted or substantively enacted by the balance sheet date. Deferred tax is the tax expected to be payable or recoverable on differencesbetween the carrying amounts of assets and liabilities in the financialstatements and the corresponding tax bases used in the computation of taxableprofit, and is accounted for using the balance sheet liability method. Deferredtax liabilities are generally recognised for all taxable temporary differencesand deferred tax assets are recognised to the extent that it is probable thattaxable profits will be available against which deductible temporary differencescan be utilised. Such assets and liabilities are not recognised if thetemporary difference arises from the initial recognition of goodwill or from theinitial recognition (other than in a business combination) of other assets andliabilities in a transaction that affects neither the tax profit nor theaccounting profit. Deferred tax liabilities are recognised for taxable temporary differencesarising on investments in subsidiaries and associates, and interests in jointventures, except where the Group is able to control the reversal of thetemporary difference and it is probable that the temporary difference will notreverse in the foreseeable future. The carrying amount of deferred tax assets is reviewed at each balance sheetdate and reduced to the extent that it is no longer probable that sufficienttaxable profits will be available to allow all or part of the asset to berecovered. Deferred tax is calculated at the tax rates that are expected to apply in theperiod when the liability is settled or the asset is realised. Deferred tax ischarged or credited in the income statement, except when it related to itemscharged or credited directly to equity, in which case the deferred tax is alsodealt with in equity. Deferred tax assets and liabilities are offset when there is a legallyenforceable right to set off current tax assets against current tax liabilitiesand whey they relate to income taxes levied by the same taxation authority andthe Group intends to settle its current tax assets and liabilities on a netbasis. Impairment of tangible and intangible assets excluding goodwill At each balance sheet date, the Group reviews the carrying amounts of itstangible and intangible assets to determine whether there is any indication thatthose assets have suffered an impairment loss. If any such indication exists,the recoverable amount of the asset is estimated in order to determine theextent of the impairment loss. Where the asset does not generate cash flowsthat are independent from other assets, the Group estimates the recoverableamount of the cash-generating unit to which the asset belongs. An intangibleasset with an indefinite useful life is tested for impairment annually andwhenever there is an indication that the asset may be impaired. Recoverable amount is the higher of fair value less costs to sell and value inuse. In assessing value in use, the estimated future cash flows are discountedto their present value using a pre-tax discount rate that reflects currentmarket assessments of the time value of money and the risks specific to theasset for which the estimates of future cash flows have not been adjusted. If the recoverable amount of an asset or cash-generating unit is estimated to beless than its carrying amount, the carrying amount of the asset orcash-generating unit is reduced to its recoverable amount and the impairmentloss is recognised as an expense immediately. When an impairment loss subsequently reverses, the carrying amount of the assetor cash-generating unit is increased to the revised estimate of its recoverableamount, but so that the increased carrying amount does not exceed the carryingamount that would have been determined had no impairment loss been recognisedfor the asset or cash-generating unit in prior years. A reversal of animpairment loss is recognised as income immediately. Financial instruments Financial assets and financial liabilities are recognised on the Group's balancesheet when the Group becomes a party to the contractual provisions of theinstrument. Trade receivables Trade receivables do not carry any interest and are measured at their nominalvalue as reduced by any appropriate allowances for irrecoverable amounts. Cash and cash equivalents Cash and cash equivalents comprise cash on hand and demand deposits, and othershort-term highly liquid investments that are readily convertible to a knownamount of cash and are subject to an insignificant risk of changes in value. Financial liabilities and equity Financial liabilities and equity instruments are classified according to thesubstance of the contractual arrangements entered into. An equity instrument isany contract that evidences a residual interest in the assets of the Group afterdeducting all of its liabilities. Bank borrowings Interest-bearing bank loans and overdrafts are recorded at the proceedsreceived, net of direct issue costs. Finance charges are accounted for on anaccruals basis in profit or loss using the effective interest rate method andare added to the carrying amount of the instrument to the extent that they arenot settled in the period in which they arise. Trade payables Trade payables are not interest bearing and are stated at their nominal value. Equity instruments Equity instruments issued by the Company are recorded at the proceeds received,net of direct issue costs. Provisions Provisions are recognised when the Group has a present obligation as a result ofa past event, and it is probable that the Group will be required to settle thatobligation. Provisions are measured at the directors' best estimate of theexpenditure required to settle the obligation at the balance sheet date, and arediscounted to present value where the effect is material. Share-based payments The Group has applied the requirements of IFRS 2 Share-based payment. Inaccordance with the transitional provisions, IFRS 2 has been applied to allgrants of equity instruments after 7 November 2002 that were unvested at 1January 2005. The Group operates a number of equity-settled share-based payment schemes underwhich share options are issued to certain employees. Equity-settled share-basedpayments are measured at fair value (excluding the effect of non market-basedvesting conditions) at the date of grant. The fair value determined at thegrant date of the equity-settled share-based payments is expensed on astraight-line basis over the vesting period, based on the Group's estimate ofshares that will eventually vest and adjusted for the effect of non market-basedvesting conditions. Fair value is measured by use of the Black Scholes model. The expected lifeused in the model has been adjusted, based on management's best estimate, forthe effects of non-transferability, exercise restrictions, and behaviouralconsiderations. Consolidated income statement for the year ended 31 December 2005 restated forIFRS UK GAAP Share-based Share-based Business Employee Assets Restated in IFRS payment payment tax combinations benefits held for under format IFRS 2 deduction sale IAS 12 IFRS 3 IAS 19 IAS39 IFRS £'000 £'000 £'000 £'000 £'000 £'000 £'000Continuing operations Revenue 13,560 - - - - - 13,560 Cost of sales (2,381) - - - - - (2,381) Gross profit 11,179 - - - - 11,179 Administrative expenses (9,139) (37) - - (21) - (9,197)Costs of restructuring (230) - - - - - (230)Amortisation of goodwill / (118) - - 82 - - (36) intangibles Total administrative expenses (9,487) (37) - 82 (21) - (9,463) Operating profit 1,692 (37) - 82 (21) - 1,716 Profit on disposal of available - - - - (218) 509for sale investments 727Interest on bank deposits 190 - - - - - 190 Profit on ordinary activities before tax 2,609 (37) - 82 (21) (218) 2,415 Tax (297) 11 (525) 11 6 218 (576) Profit for the period after tax 2,312 (26) (525) 93 (15) - 1,839 Earning per share from continuingoperationsBasic (pence) 7.2 (0.1) (1.6) 0.3 (0.0) - 5.7 Consolidated income statement for the 6 months ended 30 June 2005 restated forIFRS UK GAAP Share-based Business Employee Assets Restated in IFRS payment combinations benefits held for under sale format IFRS 2 IFRS 3 IAS 19 IAS39 IFRS £'000 £'000 £'000 £'000 £'000 £'000Continuing operations Revenue 5,669 - - - - 5,669 Cost of sales (1,109) - - - - (1,109) Gross profit 4,560 - - - - 4,560 Administrative expenses (3,854) (15) - 23 - (3,846)Costs of restructuring - - - - - -Amortisation of goodwill / intangibles (2) - 2 - - - Total administrative expenses (3,856) (15) 2 23 - (3,846) Operating profit 704 (15) 2 23 - 714 Profit on disposal of available for sale 506 - - - (152) 354investmentsInterest on bank deposits 119 - - - - 119 Profit on ordinary activities before tax 1,329 (15) 2 23 (152) 1,187 Tax (403) 4 - (7) 152 (254) Profit for the period after tax 926 (11) 2 16 - 933 Earning per share from continuing operationsBasic (pence) 3.0 - - - - 3.0 Consolidated balance sheet at 31 December 2005 restated for IFRS UK GAAP Share-based Business Employee Intangible Restated assets IAS under IFRS in IFRS payment combinations benefits 38 format IFRS 2 IFRS 3 IAS 19 £'000 £'000 £'000 £'000 £'000 £'000 Non-current assetsGoodwill 2,855 - (417) - - 2,438Other intangible assets 1,520 - 729 - 307 2,556Property, plant and 756 - - - (307) 449equipmentDeferred tax asset 341 776 - 22 - 1,139 5,472 776 312 22 - 6,582 Current assetsTrade and other receivables 5,212 - - - - 5,212Cash and cash equivalents 5,414 - - - - 5,414 10,626 - - - - 10,626 Total assets 16,098 776 312 22 - 17,208 Current liabilitiesTrade and other payables (4,190) - - (73) - (4,263)Current tax liabilities (187) - - - - (187)Obligations under finance (5) - - - - (5)leases (4,382) - - (73) - (4,455) Non-current liabilitiesDeferred tax liability - - (219) - - (219) - - (219) - - (219) Total liabilities (4,382) - (219) (73) - (4,674) Net assets 11,716 776 93 (51) - 12,534 EquityShare capital 143 - - - - 143Share premium account 6,747 - - - - 6,747Own shares (72) - - - - (72)Share options reserve - 62 - - - 62Other reserves 2,372 - - - - 2,372Retained earnings 2,526 714 93 (51) - 3,282 Total equity 11,716 776 93 (51) - 12,534 Consolidated balance sheet at 30 June 2005 restated for IFRS UK GAAP Share-based Business Employee Intangible Assets Restated assets IAS held for under in IFRS payment combinations benefits 38 sale IFRS format IFRS 2 IFRS 3 IAS 19 IAS 39 £'000 £'000 £'000 £'000 £'000 £'000 £'000Non-current assetsGoodwill 42 - 2 - - - 44Other intangible assets 583 - - - 66 - 649Property, plant and 471 - - - (66) - 405equipmentInvestments 2 - - - - (2) -Deferred tax asset 8 650 - 9 - - 667 1,106 650 2 9 - - 1,765 Current assetsTrade and other receivables 3,301 - - - - - 3,301Cash and cash equivalents 5,461 - - - - - 5,461 8,762 - - - - - 8,762 Assets held for sale 17 - - - - 169 186 Total assets 9,885 650 2 9 - 167 10,713 Current liabilitiesTrade and other payables (1,781) - - (29) - (50) (1,860)Current tax liabilities (538) - - - - - (538)Obligations under finance (8) - - - - - (8)leases (2,327) - - (29) - (50) (2,406) Non-current liabilitiesDeferred tax liability - - - - - - - - - - - - - - Total liabilities (2,327) - - (29) - (50) (2,406) Net assets 7,558 650 2 (20) - 117 8,307 EquityShare capital 133 133Share premium account 3,915 3,915Own shares (2) (2)Share options reserve - 40 40Revaluation reserve - - - - 117 117 -Other reserves 2,372 2,372 Retained earnings 1,140 610 2 (20) 1,732 Total equity 7,558 650 2 (20) - 117 8,307 Consolidated balance sheet at 1 January 2005 restated for IFRS UK GAAP Share-based Business Employee Intangible Assets Restated assets IAS held for under IFRS in IFRS payment combinations benefits 38 sale format IFRS 2 IFRS 3 IAS 19 IAS 39 £'000 £'000 £'000 £'000 £'000 £'000 £'000Non-current assetsGoodwill 45 - - - - - 45Other intangible assets 403 - - - 72 - 475Property, plant and 385 - - - (72) - 313equipmentInvestments 2 - - - - (2) -Deferred tax asset 11 659 - 16 - - 686 846 659 - 16 - (2) 1,519 Current assetsTrade and other 2,462 - - - - - 2,462receivablesCash and cash equivalents 5,204 - - - - - 5,204 7,666 - - - - - 7,666 Assets held for sale 28 - - - - 645 673 Total assets 8,540 659 - 16 - 643 9,858 Current liabilitiesTrade and other payables (1,731) - - (52) - (193) (1,976)Current tax liabilities (152) - - - - - (152)Obligations under finance (11) - - - - - (11)leases (1,894) - - (52) - (193) (2,139) Non-current liabilitiesObligations under finance (3) - - - - - (3)leases (3) - - - - - (3) Total liabilities (1,897) - - (52) - (193) (2,142) Net assets 6,643 659 - (36) - 450 7,716 EquityShare capital 133 - - - - - 133Share premium account 3,926 - - - - - 3,926Own shares (2) - - - - - (2)Share options reserve - 25 - - - - 25Revaluation reserve - - - - - 450 450Other reserves 2,372 - - - - - 2,372Retained earnings 214 634 - (36) - - 812 Total equity 6,643 659 - (36) - 450 7,716 This information is provided by RNS The company news service from the London Stock Exchange