30 Jun 2008 15:05
Canisp plc
("Canisp" or "the Company")
Audited Preliminary Results
for the twelve months ended 31 March 2008
I present the Group's audited results for the year ended 31 March 2008 in which the Group recorded a trading income (operating profit before amortisation and impairment of intangible assets) of £48,000 (2007: loss of £60,000) and a much reduced loss before taxation on the prior year of £187,000 (2007: £2,158,000) and a loss per share of 0.18p (2007: 2.64p). No dividend is proposed.
During the period we have maintained our low cost base with a very efficient head office operation and we continue to work hard to improve administration and service to customers.
Despite a trading environment which continued to be challenging throughout the year our strategy to focus on product innovation and customer service remains on track and the Company has made good progress with its customer relationships, improving both administration and service and is focused on product innovation. In September, the Company successfully launched its Voice Over Internet Protocol ("VOIP") offering to a limited number of customers and this service is progressing satisfactorily.
The Group's results show that the Company's net assets are less than half its called up share capital. In the circumstances, the directors of the Company are obliged by section 142 Companies Act 1985 to convene a general meeting for the purposes of considering whether any, and if so what, steps should be taken to deal with the Company's current financial position. We propose to consider this matter at the Company's annual general meeting details of which has been convened for 24 July 2008, although no resolution will be put to the meeting on this issue.
Corvus Capital Inc ("Corvus"), a major shareholder of the Company, has provided significant financial support to the Company for a number of years and the Board would like to thank Corvus for this support. In May 2008 the Company agreed with Corvus to consolidate all of its outstanding debt amounting to £1,600,000 into a single, assignable convertible loan facility. At Corvus's request, the Loan may be capitalised in whole or in part through the issue of new ordinary shares at one penny per share. If the capitalisation does not occur by 31 December 2009, the Loan and any interest accrued at two per cent. per annum, will be repayable on demand although the Loan, together with accrued interest will remain capable of being capitalised on the above terms.
Board Changes
On 21 April 2008 Sam Glover stepped down from the board as non-executive director and I would like to thank Sam for his contribution to the Company and wish him well in the future with his other business interests.
Outlook
The Group has continued to improve its commercial offering to new and existing customers and with the tight control of costs and reduced reliance on bank borrowings it is gradually improving its ability to tackle market challenges.
Mike Hirschfield
Chairman
27 June 2008
www.canispplc.com
Enquiries:
John Bick: tel: +44(0)7917 649362
| Canisp plc | | | | |
| | | | | |
| Consolidated Income Statement | | | | |
| | | | | |
| For the year ended 31 March 2008 | | | | |
| | | | | |
| | | | 2008 | 2007 |
| | Note | | £'000 | £'000 |
| | | | | |
| Revenue | | | 2,593 | 2,805 |
| | | | | |
| Cost of sales | | | (1,879) | (2,032) |
| | | | | |
| Gross profit | | | 714 | 773 |
| | | | | |
| Administrative expenses - amortisation of intangible assets | | | (194) | (451) |
| - impairment of intangible assets - other | | | - (697) | (1,447) (754) |
| | | | | |
| Total administrative expenses | | | (891) | (2,652) |
| | | | | |
| Unrealised fair value gain/(loss) on financial liabilities at fair value through profit and loss | | | 31 | (79) |
| | | | | |
| Loss from operations | | | (146) | (1,958) |
| | | | | |
| | | | | |
| Finance income | | | 19 | 19 |
| Finance costs | | | (60) | (219) |
| | | | | |
| Loss before taxation | | | (187) | (2,158) |
| | | | | |
| Taxation | | | - | - |
| | | | | |
| Loss after taxation and loss attributable to the equity holders of the company | | | (187) | (2,158) |
| | | | | |
| Total and continuing loss per ordinary share (pence) | | | | |
| Basic and diluted | 3 | | (0.18)p | (2.64)p |
All of the activities of the Group are classed as continuing.
| Canisp plc | | | | | |
| | | | |||
| Consolidated Statement of Changes in Equity | | | |||
| | | | |||
| For the year ended 31 March 2008 | | | |||
| | | | | | |
| | Share capital | Share premium | Other reserves | Retained earnings | Total equity |
| | £'000 | £'000 | £'000 | £'000 | £'000 |
| | | | | | |
| At 1 April 2006 | 196 | 4,047 | - | (4,415) | (172) |
| Loss for the year and total and recognised income and expenses for the year | | - | - | (2,158) | (2,158) |
| Issue of share capital | 858 | - | - | - | 858 |
| Cost of issue of share capital | - | (30) | - | - | (30) |
| On conversion of loan | - | - | 129 | - | 129 |
| At 31 March 2007 | 1,054 | 4,017 | 129 | (6,573) | (1,373) |
| | | | | | |
| Loss for the year and total and recognised income and expenses for the year | - | - | - | (187) | (187) |
| At 31 March 2008 | 1,054 | 4,017 | 129 | (6,760) | (1,560) |
| Canisp plc | ||||
| Consolidated Balance Sheet | ||||
| As at 31 March 2008 | ||||
| 2008 | 2007 | |||
| £000 | £000 | |||
| ASSETS | ||||
| Non-current assets | ||||
| Intangible assets | 656 | 850 | ||
| Property, plant and equipment | 11 | - | ||
| 667 | 850 | |||
| Current assets | ||||
| Trade and other receivables | 340 | 316 | ||
| Total current assets | 340 | 316 | ||
| Total assets | 1,007 | 1,166 | ||
| LIABILITIES | ||||
| Current liabilities | ||||
| Bank overdrafts | 162 | 160 | ||
| Bank loans | - | 325 | ||
| Other loans | 1,041 | 629 | ||
| Convertible loan | 528 | 528 | ||
| Trade and other payables | 788 | 818 | ||
| Financial liabilities at fair value through profit or loss | 48 | 79 | ||
| Total current liabilities | 2,567 | 2,539 | ||
| Total liabilities | 2,567 | 2,539 | ||
| EQUITY | ||||
| Share capital | 1,054 | 1,054 | ||
| Share premium | 4,017 | 4,017 | ||
| Other reserves | 129 | 129 | ||
| Retained earnings | (6,760) | (6,573) | ||
| Total equity attributable to equity holders of the Company | (1,560) | (1,373) | ||
| Total equity and liabilities | 1,007 | 1,166 |
| Canisp plc | ||||
| Consolidated Cash Flow Statement | ||||
| For the year ended 31 March 2008 | ||||
| 2008 | 2007 | |||
| £000 | £000 | |||
| Cash flows from operating activities | ||||
| Loss after taxation | (187) | (2,158) | ||
| Amortisation | 194 | 426 | ||
| Impairment of intangibles and goodwill | - | 1,472 | ||
| Depreciation | 4 | - | ||
| On conversion of loan | - | 129 | ||
| Unrealised fair value (gain)/loss on financial liabilities at fair value through profit and loss | (31) | 79 | ||
| Finance costs | 60 | 219 | ||
| Finance income | (19) | (19) | ||
| (Increase)/decrease in trade and other receivables | (24) | 173 | ||
| (Decrease) in trade and other payables | (30) | (397) | ||
| (33) | (76) | |||
| Finance costs | (60) | (219) | ||
| Net cash outflow from operating activities | (93) | (295) | ||
| Cash flows from investing activities | ||||
| Purchase of property, plant and equipment | (15) | - | ||
| Finance income | 19 | 19 | ||
| Net cash inflow from investing activities | 4 | 19 | ||
| Cash flows from financing activities | ||||
| Proceeds from issue of share capital | - | 600 | ||
| Share issue costs | - | (30) | ||
| New loans | 412 | 528 | ||
| Repayment of loans | (325) | (717) | ||
| Capital element of hire purchase agreements | - | (5) | ||
| Net cash inflow from financing activities | 87 | 376 | ||
| Net change in cash and cash equivalents | (2) | 100 | ||
| Cash and cash equivalents at beginning of period | (160) | (260) | ||
| Cash and cash equivalents at end of period | (162) | (160) |
1. basis of preparation
The group financial statements have been prepared under the historical cost convention except for embedded derivatives, which are measured at fair value and in accordance with International Financial Reporting Standards as adopted by the European Union (IFRS).
The transition to IFRS has resulted in a number of changes in the reported financial statements, notes thereto and accounting policies compared to the previous annual report. The effect of the transition to IFRS is detailed in the Group's annual report and financial statements.The principal accounting policies are detailed in the Group's annual report and financial statements.Going concernThe Directors have prepared cash flow forecasts for the period ending 31 March 2011. The Directors have also secured confirmation from Corvus Capital Inc. (Corvus), a significant shareholder in the Company, that it will not seek repayment of the debt due to it within the next twelve months and, in addition, that a further working capital facility of up to £100,000 will be provided if required. The forecasts supported by the agreement and facility from Corvus, together with existing bank facilities, demonstrate that the Group has sufficient finance facilities available to allow it to continue in business for a period of at least twelve months from the date of approval of these financial statements. Accordingly, the accounts have been prepared on a going concern basis.
2. segmental information
a) Primary reporting format - business segment
As defined under International Accounting Standard 14 "Segment Reporting" (IAS 14), the only material business segment the Group has is that of telecommunications.
b) Secondary reporting format - geographical segment
Under the definitions contained in IAS 14 the only material geographic segment that the Group operates in is the UK.
3. LOSS PER SHARE
The calculation of the basic loss per share is based on the loss after taxation of £187,000 (2007: £2,158,000) divided by the weighted average number of ordinary shares in issue during the year of 105,397,275 (2007: 81,669,193).
The impact of the convertible loan on the loss per share is anti dilutive.
4. publication of non-statutory accounts
The financial information set out in this preliminary announcement does not constitute statutory accounts as defined in section 240 of the Companies Act 1985.
The summarised consolidated balance sheet at 31 March 2008 and the summarised consolidated income statement, summarised consolidated cash flow statement and associated notes for the year then ended have been extracted from the Group's 2008 statutory financial statements upon which the auditor's opinion is unqualified and does not include any statement under Section 237 of the Companies Act 1985.
Those financial statements have not yet been delivered to the registrar of companies.