25 Nov 2008 07:00
Torotrak plc
("Torotrak" or "the Company")
Half-year results for the six months ended 30 September 2008
Torotrak plc, the world leader in full-toroidal traction drive transmission technology, announces its half-year results for the six months ended 30 September 2008.
Business highlights:
| * | Trading in line with market expectations and consistent with our July 2008 outlook |
| * | Increased business development activity, in spite of tough economic environment, with valuable new prospects in key markets |
| * | Engineering development programme with leading European truck and bus manufacturer progressing well and now in detailed design stage |
| * | Market launch of joint venture Infinitrak's first transmission positively received with work underway on a second transmission |
| * | Resilient level of funding and excellent lead customers committed to medium to long term programmes provides a strong position to deliver business plan objectives |
Financial highlights:
| * | £9.7m cash resources, with no debt, at 30 September 2008 (2007: £8.7m) provide a solid foundation of financial capital to underpin commercialisation |
| * | Growth in revenues to £0.9m (2007: £0.5m) from increased levels of engineering activity with key customers |
| * | Strong weighting of revenues expected in the second half from existing and potential new licensees |
| * | Losses reduced to £1.9m (2007: £2.4m) in line with expectations |
Dick Elsy, Chief Executive, said:
"As a result of the success of our diversification strategy, Torotrak is experiencing an increased level of business development activity and despite the difficult economic environment, has made good progress. Production and sales of our first transmission in the outdoor power equipment market has proven the cost-effectiveness of full-toroidal traction drives and has enhanced the appeal of our technology across our markets. The long term nature of the commitment from our lead customers, together with Torotrak's sound financial position, means that we are well placed on our path to widespread commercialisation."
For further information, please visit www.torotrak.com or contact:
| Dick Elsy, Chief Executive | Simon Hudson |
| Jeremy Deering, Finance Director | Lulu Bridges |
| Torotrak Plc | Tavistock Communications |
| Tel: +44 1772 900938 | Tel: +44 20 7920 3150 |
Current economic climate and prospects
Torotrak remains securely positioned, despite the current turbulence in world markets. As a result of the success of our diversification strategy, including our reduced dependency on the passenger car market, we believe that our medium and long term prospects are materially unaffected and that our financial position is robust with trading, in this financial year, being in line with market expectations. We view our prospects as having strengthened since last reporting.
We are working with a number of key customers who are committed to medium to long term programmes. These programmes have been largely unaffected by current economic circumstances and, in our view, the competitive position of our technology, and its relevance as a cost effective, environmentally friendly solution for the future, has improved.
Business development activity has increased during the first half of this year and we are now working with an enlarged number of prospective customers who see significant opportunities to exploit our technology. This gives us confidence that we will secure, in the short to medium term, payments from new licensees and engineering development programmes whilst also building the prospects for recurring income streams in the medium to longer term as Torotrak's technology is introduced in each of our key markets.
One adverse effect of the economic climate has been a considerable reduction in consumer demand in North America for outdoor power equipment (OPE) as a result of the restriction in credit availability and the decline in consumer confidence generally. This will affect the level of early orders for our joint venture Infinitrak's first transmissions and is expected to lead to a more modest level of market introduction for as long as the economic downturn persists. However, our approach, as reported in June 2008, has been to prioritise the robustness of market launch and our plan had assumed only a very modest level of contribution from Infinitrak in this financial year. The growing diversity of our earnings and market opportunities means that any reduction in the expected build of Infinitrak sales beyond this financial year is capable of being offset wholly or partially by increasing contributions elsewhere. Investment in the development of new products for Infinitrak continues, which supports an encouraging medium to long term outlook for the joint venture.
Results
Revenues
Revenues of £927k in the six months to 30 September 2008 increased by £406k over the six month period to 30 September 2007 as a result of greater levels of engineering activity. This increase in revenues reflects, principally, the significant engineering programme with a major European truck and bus manufacturer which we commenced earlier this calendar year. Revenues also include engineering development with Tata Motors, where we have substantially completed our programme of technology transfer to them and have now commenced a joint study on their first application, as well as the delivery of a prototype programme with a world leading fork lift truck manufacturer. In addition, we undertook a range of engineering support activities across our other market sectors.
In the first half of the year, we earned a further £155k due as a staged licence payment from one of our licensees. More substantial licensing income is expected in the second half of this financial year from existing and potential new customers.
As expected, revenues in the first half from Infinitrak were low with just £12k of sales recognised from the initial sale of units to a specialist third party customer, Advanced Turf Technologies. We expect Infinitrak sales to build modestly in the second half of the financial year.
Operating performance
Operating costs were held broadly at 2007 levels whilst revenues continued to build. Within those operating costs, we continue to apply resources to technical and commercial development with associated costs of £2.3m (2007: £2.3m). As a result, a loss after taxation of £1.9m was incurred for the six months to 30 September 2008, a reduction of £0.5m compared with the loss of £2.4m for the six months to 30 September 2007.
Cash
Cash resources remain strong at £9.7m at 30 September 2008 (£8.7m at 30 September 2007 and £11.5m at 31 March 2008). The additional funds received in the last financial year as a result of the Placing and Open Offer, as well as the substantial up-front licence payments, means that the Company has a solid base of financial capital to pursue its path to widespread commercialisation through to positive operating cash flow.
The improvement in operating performance has had a corresponding beneficial impact on cash utilisation, with a £0.5m reduction in cash outflow in the six months to 30 September 2008 to £1.9m compared with the outflow of £2.5m recorded in the corresponding period in 2007. It remains our objective to achieve positive operating cash flow as we build revenues and secure new licence deals. As reported previously, the timing of licence payments means that our progress towards this objective should be viewed on an averaged basis over a two to three year time frame.
Cash continues to be managed conservatively and is invested with banks that carry a high degree of financial security. Cash funds are invested in UK sterling in financial institutions that carry a minimum long term rating of 'AA' and a minimum short term rating of 'A' as evaluated by Standard & Poor's, with equivalent ratings from other agencies also being monitored. Cash deposits at 30 September 2008 were held with Barclays Bank plc, Clydesdale Bank plc and Svenska Handelsbanken AB.
Risks and uncertainties
Other than the impact of world economic conditions referred to above, there has been no material change to the key risks and uncertainties facing the group as described in the Financial Review and Directors' Report sections of the 2008 Annual Report.
Customer and market review
This has been a period of encouraging and positive engagement with customers and prospects across all of our key markets.
Outdoor power equipment
In the OPE market, the production and sale of Infinitrak's initial transmissions has brought Torotrak's technology into commercial application for the first time.
The market launch of our first OPE transmission, Infinitrak's TTT, has been targeted initially at the premium end of the mower market, where consumer demand has been particularly impacted by current economic conditions. Against this difficult trading backdrop, we are pleased to have received confirmation from MTD of a requirement for an initial 1,000 to 2,000 TTTs to fulfil demand for rider products from a prominent US retailer that has been impressed with the improvements in performance and controllability that the TTT provides. Whilst this is an encouraging endorsement and indication of future potential, with so much uncertainty in the retail markets it is difficult to predict the extent to which other OPE orders will be placed this financial year. As reported in July, however, our objectives are focused on ensuring a successful market introduction and, whilst expected unit sales this financial year are modest, they remain an important part of Infinitrak's first year production plan.
Infinitrak is becoming increasingly active in external business development activities with new prospective customers. The availability, in production, of the TTT has been a powerful tool in promoting the benefits of our technology to other OPE manufacturers, enabling prospective customers to experience the product first-hand and to build confidence in its capabilities. The encouraging level of interest that this work has generated supports our conviction that the medium to long term future of Infinitrak remains strong.
Infinitrak's continuing investment in new technology has been unaffected by the difficult near term trading outlook. A second transmission is now in development, which is a simpler, lower cost unit than the TTT with broad market appeal. This will make it an easier proposition to launch into current market conditions. The first vehicles equipped with prototypes of this transmission demonstrate strong advantages over competing products.
Truck and bus
In the commercial vehicle market, the previously reported programme being undertaken with a major European truck and bus manufacturer to develop a production representative main-drive transmission is progressing well. We are working very closely with this significant customer to maintain a high level of confidence in delivery of the programme.
The extent and reach of our technology for commercial vehicle applications is proving to be greater than originally envisaged when we began to target this market. Torotrak's technology is increasingly being seen as potentially transformational for commercial vehicle applications as it offers fuel consumption and emissions benefits as well as providing high levels of refinement and sophistication in the driving experience. Furthermore, the detailed design work being carried out for our first customer in this field continues to support the view that transmissions featuring Torotrak technology provide a strong cost advantage compared to the automatic gearboxes that are currently available in this market.
The potential for Torotrak's technology in the truck and bus market is considerable and represents a significant opportunity to deliver short to medium term licence and engineering income and, most importantly, future royalty income streams.
Off-highway
The off-highway market has been the source of significant business development activity in the first half of this year. Our active licensees in the agriculture sector, Carraro and Iseki, both continue to make progress with their respective plans towards market introduction. We are also working with an emerging-economy customer, new to Torotrak, that is keen to engage in a development programme in this sector.
Our first programme in the material handling sector, a prototype fork lift truck transmission, has been successfully commissioned in the customer's vehicle and delivered to the client, a leading manufacturer in the global materials handling equipment market. This customer has been pleased with the performance of Torotrak's technology which has provided a highly competitive driving feel together with excellent levels of control. Within the scope of this first programme we have been able to demonstrate a range of innovative capabilities and features of the technology which reinforces its appeal. The client is about to commence their programme of internal evaluation and testing, which will determine the next stage of our commercial engagement with them.
Automotive
We have commenced work on a project as part of a consortium to design and develop a flywheel based mechanical hybrid, a kinetic energy recovery system (KERS), for the mainstream, passenger car automotive market. With Jaguar Cars as the lead customer, and part-funded by the UK Government backed Technology Strategy Board, the consortium group comprises a number of prominent UK businesses including ourselves, Ford, Prodrive, Ricardo and Flybrid Systems. Although at an early stage, this programme appears to have interesting future commercial potential. Expected outcomes from the project are a proof of concept vehicle and a full implementation and production plan.
The visibility provided by Formula 1 interest in mechanical hybrids, and the profile we have gained as a result of this, has provided a powerful endorsement of our technology and a strong platform to explore future business opportunities. As has been widely reported in the media, however, there continues to be uncertainty about the pace and extent of KERS adoption within Formula 1. With technology secrecy always central to this sport, it remains hard for us to assess whether our variable drives will feature in the 2009 season or subsequently. For this reason we continue to treat Formula 1, and motorsport in general, as an interesting but highly speculative market.
Torotrak's low cost capability in the Infinitrak OPE transmission is proving to be very helpful in supporting concept development of small car traction drive transmissions. As previously reported, much of our focus in the small car market has been with Aisin AW, with whom we continue to work closely. Additionally, we have now commenced a feasibility study for a new small car transmission with another tier 1 automotive transmission and components manufacturer, that is a new client for Torotrak.
Work is progressing well with Tata Motors. Tata is licensed for a broad range of products which extends beyond the traditional passenger car automotive market, and ranges from small cars through to large trucks and construction equipment. Tata has now selected its first target application of Torotrak's technology and we are currently helping their engineers with the early stages of specifying and configuring this application, in preparation for commencing detailed design and prototype implementation.
Outlook
We continue to be encouraged by sustained progress with our existing clients and the increasing level of interest being shown by new prospective customers. Despite the generally poor economic outlook, the environment is becoming increasingly favourable for Torotrak's technology, with the commercial vehicle market in particular now being an important area of focus for us.
Whilst economic circumstances in the OPE market are leading to a lowering of demand from Infinitrak's customers, investment in the development and launch of additional transmissions at Infinitrak has continued. We remain confident of medium and long term commercial success in this market.
Shorter term, our strategy to build recurring revenues from engineering development and licensing activity is being underpinned by a growing customer and prospect list. This, together with our resilient cash position, puts Torotrak on a sound financial footing to achieve our business objectives of widespread commercialisation through to positive and recurring operating cash flow.
Independent review report to Torotrak plc
Introduction
We have been engaged by the company to review the condensed set of financial statements in the half-year financial report for the six months ended 30 September 2008, which comprises the consolidated income statement, consolidated balance sheet, consolidated statement of recognised income and expense, consolidated cash flow statement and related notes. We have read the other information contained in the half-year financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.
Directors' responsibilities
The half-year financial report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the half-year financial report in accordance with the Disclosure and Transparency Rules of the United Kingdom's Financial Services Authority.
As disclosed in note 1, the annual financial statements of the group are prepared in accordance with IFRSs as adopted by the European Union. The condensed set of financial statements included in this half-year financial report has been prepared in accordance with International Accounting Standard 34, "Interim Financial Reporting", as adopted by the European Union.
Our responsibility
Our responsibility is to express to the company a conclusion on the condensed set of financial statements in the half-year financial report based on our review. This report, including the conclusion, has been prepared for and only for the company for the purpose of the Disclosure and Transparency Rules of the Financial Services Authority and for no other purpose. We do not, in producing this report, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.
Scope of review
We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-year financial report for the six months ended 30 September 2008 is not prepared, in all material respects, in accordance with International Accounting Standard 34 as adopted by the European Union and the Disclosure and Transparency Rules of the United Kingdom's Financial Services Authority.
PricewaterhouseCoopers LLP
Chartered Accountants
25 November 2008
Manchester
Notes
The maintenance and integrity of the Torotrak plc website is the responsibility of the directors, the work carried out by the auditors does not involve consideration of these matters and, accordingly the auditors accept no responsibility for any changes which may have occurred to the financial statements since they were initially presented on the website.
Legislation in the United Kingdom governing the preparation and distribution of the financial statements may differ from legislation in other jurisdictions.
Consolidated income statement
For six months ended 30 September 2008
| Unaudited | Unaudited | ||
| six months | six months | ||
| to 30/09/08 | to 30/09/07 | ||
| Notes | £000 | £000 | |
| Revenue | 6 | 927 | 521 |
| Development expenses |
| (2,333) | (2,283) |
| Administrative expenses - normal | (860) | (869) | |
| Administrative expenses - non-recurring operating costs | 7 | - | (164) |
| Total administrative expenses |
| (860) | (1,033) |
| Operating loss | (2,266) | (2,795) | |
|
|
|
|
|
| Finance income |
| 306 | 146 |
|
|
|
| |
| Loss before taxation |
| (1,960) | (2,649) |
| Taxation | 10 | 105 | 200 |
| Loss for the period | 14 | (1,855) | (2,449) |
| Basic and diluted loss per share (pence) | 8 | (1.27) | (1.93) |
The results above derive from continuing operations.
Consolidated statement of recognised income and expense
| Unaudited | Unaudited | ||
| six months | six months | ||
| to 30/09/08 | to 30/09/07 | ||
| £000 | £000 | ||
| Currency translation differences | 14 | 8 | (7) |
| Net gain/(loss) recognised in equity | 8 | (7) | |
| Loss for the period | 14 | (1,855) | (2,449) |
| Total recognised expense for the period | (1,847) | (2,456) |
The notes below form an integral part on this condensed consolidated half-year financial information.
Consolidated balance sheet
As at 30 September 2008
| Unaudited | Audited | Unaudited | ||
| as at 30/09/08 | as at 31/03/08 | as at 30/09/07 | ||
|
| Notes | £000 | £000 | £000 |
| Non current assets | ||||
| Intangible assets | 9 | 1,179 | 1,154 | 1,084 |
| Property, plant and equipment | 9 | 1,013 | 1,102 | 1,044 |
| Total non current assets |
| 2,192 | 2,256 | 2,128 |
| Current assets | ||||
| Inventories | 34 | 32 | 35 | |
| Trade and other receivables | 11 | 930 | 517 | 1,644 |
| Current tax | 214 | 514 | 468 | |
| Cash and cash equivalents | 13 | 9,658 | 11,549 | 8,676 |
| Total current assets |
| 10,836 | 12,612 | 10,823 |
| Total assets |
| 13,028 | 14,868 | 12,951 |
| Current liabilities | ||||
| Trade and other payables | 12 | (2,301) | (2,525) | (1,094) |
| Total current liabilities |
| (2,301) | (2,525) | (1,094) |
| Net assets |
| 10,727 | 12,343 | 11,857 |
| Capital and reserves | ||||
| Called up share capital | 14 | 14,608 | 14,608 | 14,608 |
| Share premium account | 14 | 52,766 | 52,766 | 52,766 |
| Other reserves | 14 | (31) | (202) | (202) |
| Retained earnings | 14 | (56,616) | (54,829) | (55,315) |
| Total equity |
| 10,727 | 12,343 | 11,857 |
The notes below form an integral part on this condensed consolidated half-year financial information.
Consolidated cash flow statement
For the six months ended 30 September 2008
| Unaudited | Unaudited | ||
| six months | six months | ||
| to 30/09/08 | to 30/09/07 | ||
|
| Notes | £000 | £000 |
| Loss for the period | (1,855) | (2,449) | |
| Adjustments for: | |||
| Depreciation | 9 | 114 | 75 |
| Amortisation | 9 | 53 | 50 |
| Finance income receivable | (306) | (146) | |
| Loss on disposal of intangible assets | 60 | 2 | |
| Taxation | 10 | (105) | (200) |
| (Increase)/decrease in inventories | (2) | 11 | |
| Increase in trade and other receivables | (299) | (282) | |
| (Decrease)/increase in trade and other payables | (226) | 231 | |
| Charges in relation equity settled employee share schemes and bonuses | 231 | 266 | |
| Cash used in operations | (2,335) | (2,442) | |
| Income tax received | 405 | - | |
| Net cash used in operating activities | (1,930) | (2,442) | |
| Cash flows from investing activities | |||
| Acquisition of property, plant and equipment | (25) | (32) | |
| Acquisition of patents | (136) | (109) | |
| Finance income received | 192 | 110 | |
| Net cash used in investing activities | 31 | (31) | |
| Cash flows from financing activities | |||
| Net proceeds from the issue of share capital | - | 6,849 | |
| Net cash generated in financing activities | - | 6,849 | |
| Net (decrease)/increase in cash and cash equivalents | (1,899) | 4,376 | |
| Cash and cash equivalents at start of period | 11,549 | 4,307 | |
| Exchange gain/(loss) on currency translation | 8 | (7) | |
| Cash and cash equivalents at end of period | 9,658 | 8,676 | |
| Cash and cash equivalents held in the JV not under direct control of the Group | 52 | 162 |
The notes below form an integral part on this condensed consolidated half-year financial information.
Notes to the half year financial information
1 General information
The Company is a public limited company incorporated and domiciled in the UK. The address of its registered office is 1 Aston Way, Leyland, Lancashire PR26 7UX.
The Company is listed on the London Stock Exchange under the trading symbol TRK.
These condensed consolidated half year financial statements were approved for issue on 25 November 2008.
These half year financial statements do not comprise statutory accounts within the meaning of Section 240 of the Companies Act 1985. Statutory accounts for the year ended 31 March 2008 were approved by the Board of Directors on 20 June 2008 and delivered to the Registrar of Companies. The report of the auditors on those accounts was unqualified, did not contain an emphasis of matter paragraph and did not contain any statement under Section 237 of the Companies Act 1985.
The financial information contained in this report is unaudited.
2 Basis of preparation
These condensed consolidated financial statements for the halfߛyear ended 30 September 2008 have been prepared in accordance with the Disclosure and Transparency Rules of the Financial Services Authority and with IAS 34, 'Interim financial reporting' as adopted by the European Union and should be read in conjunction with the annual financial statements for the year ended 31 March 2008, which have been prepared in accordance with IFRSs as adopted by the European Union.
3 Accounting policies
The accounting policies adopted in these condensed consolidated half year financial statements are consistent with those of the annual financial statements for the year ended 31 March 2008, as described in those annual financial statements. The adoption of standards, amendments and interpretations effective in 2008 has not lead to any changes in the Group's accounting policies.
4 Basis of consolidation
Jointly controlled entities are those entities over whose activities the Group has joint control, established by contractual agreement. The condensed consolidated half year financial statements include the Group's share of each line of the group income statement, balance sheet, cash flow and related notes to the financial statements on a proportionate consolidation basis, from the date that joint control commences until the date that joint control ceases.
5 Segmental analysis
In the opinion of the Directors, the Group operates in one primary segment being the business of the design and development of traction drive transmission technology. In the opinion of the Directors, and given the current mix of revenues, the Group does not currently operate in markets or geographical segments that are materially distinguishable in terms of risks and returns.
6 Revenue
| Unaudited | Unaudited | |
| six months | six months | |
| to 30/09/08 | to 30/09/07 | |
|
| £000 | £000 |
| Gross revenue | 927 | 521 |
The Group's results are not considered to be subject to significant changes as a result of seasonality.
Group revenue comprises engineering services and other income as analysed below.
| Unaudited | Unaudited | |
| six months | six months | |
| to 30/09/08 | to 30/09/07 | |
|
| £000 | £000 |
| Engineering services | 760 | 371 |
| Licence, option fees and sale of IP rights | 155 | 150 |
| Product sales by the JV | 12 | - |
| Total | 927 | 521 |
7 Administrative expenses
The following non-recurring operating costs have been charged to operating profit during the period:
| Unaudited | Unaudited | |
| six months | six months | |
| to 30/09/08 | to 30/09/07 | |
| £000 | £000 | |
| Costs incurred in relation to refinancing that are not directly attributable to the share placing | - | 164 |
8 Earnings per share
Basic loss per share is based on the loss after tax of £1,855,000 (2007: £2,449,000) and 145.6 million shares (2007: 126.5 million) being the weighted average number of shares in issue during the year.
| Unaudited | Unaudited | |
| six months | six months | |
| to 30/09/08 | to 30/09/07 | |
| The basic and diluted earnings per share from continuing operations attributable to the equity holders of the Company (pence) | (1.27) | (1.93) |
In accordance with IAS33 'Earnings per Share' the number of shares used in the calculation excludes the weighted average number of shares held by the Employee Share Trust of 490,023 (2007: 324,225).
9 Fixed assets
| Intangible | |||
| assets - | Property, plant | ||
| patents | and equipment | Total | |
| £000 | £000 | £000 | |
| Net book value at 1 April 2007 | 1,027 | 1,087 | 2,114 |
| Expenditure/additions | 109 | 32 | 141 |
| Disposals | (2) | - | (2) |
| Amortisation /depreciation | (50) | (75) | (125) |
| Net book value at 30 September 2007 | 1,084 | 1,044 | 2,128 |
| Expenditure/additions | 126 | 142 | 268 |
| Disposals | (38) | - | (38) |
| Amortisation /depreciation | (18) | (84) | (102) |
| Net book value at 31 March 2008 | 1,154 | 1,102 | 2,256 |
| Expenditure/additions | 138 | 25 | 163 |
| Disposals | (60) | - | (60) |
| Amortisation /depreciation | (53) | (114) | (167) |
| Net book value at 30 September 2008 | 1,179 | 1,013 | 2,192 |
10 Taxation
The credit for taxation is based on the estimated effective rate for the year as a whole, adjusted for taxation losses brought forward and reflects research and development tax credits.
11 Trade and other receivables
| Unaudited | Audited | Unaudited | |
| at 30/09/08 | at 31/03/08 | at 30/09/07 | |
| £000 | £000 | £000 | |
| Trade receivables | 266 | 305 | 191 |
| Other receivables and accrued income | 309 | 15 | 969 |
| Prepayments | 355 | 197 | 484 |
|
| 930 | 517 | 1,644 |
12 Trade and other payables
| Unaudited | Audited | Unaudited | |
| at 30/09/08 | at 31/03/08 | at 30/09/07 | |
| £000 | £000 | £000 | |
| Trade payables | 292 | 180 | 215 |
| Overseas tax | - | - | 116 |
| Social security and income tax | 86 | 88 | 261 |
| Accruals | 334 | 552 | 502 |
| Deferred income | 1,589 | 1,705 | - |
|
| 2,301 | 2,525 | 1,094 |
13 Financial instruments, assets and liabilities
| Unaudited | Audited | Unaudited | |
| at 30/09/08 | at 31/03/08 | at 30/09/07 | |
|
| £000 | £000 | £000 |
| Cash | (11) | 801 | (50) |
| Sterling cash deposits | 9,617 | 10,656 | 8,564 |
| Cash held in the Joint Venture | 52 | 92 | 162 |
| Cash and cash equivalents | 9,658 | 11,549 | 8,676 |
Note: Cash funds at 30 September 2008 were held with Barclays Bank plc, Clydesdale Bank plc and Svenska Handelsbanken AB.
14 Reconciliation of share capital and reserves attributable to equity holders of the parent
| Share capital | Share premium account | Other reserve | Retained earnings | Total equity | |
| £000 | £000 | £000 | £000 | £000 | |
| At 1 April 2007 | 11,990 | 48,298 | (262) | (52,720) | 7,306 |
| Loss for the period | - | - | - | (2,449) | (2,449) |
| Share placing | 2,618 | 5,237 | (1) (345) | - | 7,510 |
| Expenses of share placing | - | (769) | - | - | (769) |
| Shares awarded at cost price | - | - | 405 | (405) | - |
| Share based payment charge | - | - | - | 266 | 266 |
| Translation differences in the JV | - | - | - | (7) | (7) |
| At 30 September 2007 | 14,608 | 52,766 | (202) | (55,315) | 11,857 |
| Profit for the period | - | - | - | 319 | 319 |
| Share based payment charge | - | - | - | 162 | 162 |
| Translation differences in the JV | - | - | - | 5 | 5 |
| At 1 April 2008 | 14,608 | 52,766 | (202) | (54,829) | 12,343 |
| Loss for the period | - | - | - | (1,855) | (1,855) |
| Shares awarded at cost price | - | - | 171 | (171) | - |
| Share based payment charge | - | - | - | 231 | 231 |
| Translation differences in the JV | - | - | - | 8 | 8 |
| At 30 September 2008 | 14,608 | 52,766 | (31) | (56,616) | 10,727 |
(1) Purchase of shares by Employee Share Trust.
No interim dividend has been proposed.
15 Related party transactions
The Group did not participate in any related party transactions that require disclosure.
Statement of Directors' responsibilities
The Directors confirm that, to the best of their knowledge, this condensed set of half-year financial statements has been prepared in accordance with IAS 34, as adopted by the European Union, and that the half-year management report herein includes a fair review of the information required by 4.2.7 and 4.2.8 of the Disclosure and Transparency Rules of the United Kingdom's Financial Services Authority, namely:
a) an indication of the important events that have occurred during the first six months of the financial year ending 31 March 2009 and their impact on the condensed consolidated half-year financial statements and a description of the principal risks and uncertainties for the remaining six months of the financial year; and
b) disclosure of material related party transactions and changes therein.
The Directors of Torotrak plc are listed in the Torotrak plc Annual Report for the year ended 31 March 2008. There have been no changes since that date. A list of current Directors is maintained on the Torotrak plc website: www.torotrak.com.
By order of the Board
Dick Elsy - Chief Executive
Jeremy Deering - Finance Director
25 November 2008