Volvere Regulatory News (VLE)

Volvere plc

("Volvere" or the "Group")

Interim Results for the six months ended 30 June 2014

Volvere plc (AIM: VLE), the growth and turnaround investment company, announces its Interim Results for the six months ended 30 June 2014.

Highlights

Note

1 June 2013 comparatives have been re-presented where appropriate to exclude the results of discontinued operations

2 Based on respective period end shares in issue of 4,155,958, 4,717,791 and 4,259,958

· JMP performance satisfactory following acquisition in 2013, with revenue and underlying profit before tax of £5.6 million and £0.35 million respectively

· Shire Foods losses reduced to £0.18 million on increased revenue of £4.1 million

· Balance sheet remains strong with high liquidity

For further information:

Chairman's Statement

I am pleased to report steady progress for the Group in the first half of 2014. Our net assets per share were £3.93, slightly lower than at the end of 2013 (when they were £4.00) due to certain non-recurring charges. The current environment is producing regular investment opportunities and we are actively looking at growing the portfolio. Our existing businesses continued to show positive progress and that, combined with our strong balance sheet, gives us confidence for the future.

David Buchler

Chairman

22 September 2014

Chief Executive's Statement

I am pleased to report a broadly encouraging result in the first half of 2014. The performance of each of the Group's segments is set out below.

Transport planning and engineering consultancy

This segment comprises JMP Consultants Limited ("JMP"), which the Group acquired in May 2013. JMP provides transport planning and other property and engineering consultancy services to both the public and private sectors.

Following the integration of JMP into the Group last year, we have continued to invest in both people and systems to provide a robust platform for growth. Revenue for the first half of 2014 was £5.61 million, compared to £7.41 million for the 7½ month period ended 31 December 2013 (30 June 2013: £1.26 million). The profit before tax and Group interest charges was satisfactory at £0.2 million (30 June 2013: £0.19 million, 31 December 2013: £1.11 million). This period's result is after a non-cash share-based payments charge of £0.16 million relating to the management incentive scheme described below. In addition, the result for the year ended 31 December 2013 was boosted by one-off acquisition-related credits of £0.57 million. The underlying result for 2013 was £0.54 million. Given the current workload on hand, we believe that performance will be enhanced in the second part of the year.

In January 2014, our holding in JMP was reduced to 75% following implementation of a management incentive scheme. Whilst this reduced the net assets attributable to Volvere shareholders, it served to align our interests with those of JMP's management.

JMP's staff have worked hard in a client environment that is encouragingly active but which continues to be conscious of spend levels. As with any consultancy, the relationships of our people with our clients and the quality of the work that they do are paramount in developing an enduring, profitable business. JMP has a long track record in its sector and we remain confident about its future.

Security solutions

Sira Defence and Security Limited ("SDS"), our security solutions business, continued to make modest progress compared to the prior period with increased revenue of £0.15 million (30 June 2013: £0.10 million, 31 December 2013: £0.18 million). The breakeven performance in the comparable period (and indeed whole) of 2013 was much improved in 2014, with a profit before interest and tax of £0.06 million. SDS remains small, but we continue to pursue opportunities for widening its installed base and are encouraged by the structural changes taking place in the UK judicial sector where efficiency requirements are increasing the opportunities for SiraView, our digital CCTV viewing software.

Food manufacturing

This segment comprises Shire Foods Limited ("Shire"), the Group's 80%-owned frozen pie and pasty manufacturing business, which was acquired during 2011.

The revenue and the loss before tax for the period were £4.07 million and £0.18 million respectively (30 June 2013: £3.14 million, loss £0.36 million, 31 December 2013 £8.53 million, profit £0.12 million).

Since acquisition we have grown the client base whilst maintaining Shire's reputation for quality and competitiveness. As a result, the financial performance of Shire has continued to improve in 2014 as new client lines were launched.

Shire's revenue and profitability is weighted towards the end of the calendar year when the colder months lead to an increase in sales. Product launches that commenced during the first half of 2014 are also expected to contribute more fully to the second half of the year as ranges become established.

As Shire moves from the turnaround to the growth phase we are seeking to put in place the foundations for Shire's continued development by further investment in its site. We are expecting to achieve this through an increase in third party debt in Shire. This has only been possible because of Shire's improved financial performance.

Further information is set out in the financial review below and in note 2, segmental information.

Purchase of own shares

During the period the Group acquired further shares for treasury for a total consideration of £0.28 million. This brings the aggregate value of shares purchased as of 30 June 2014 to £5.73 million.

Acquisitions and future strategy

The positive UK economic environment is providing a useful trading backdrop for the existing businesses in the Group. However, we continue to receive and review an encouraging number of distressed opportunities from a range of sources as investors and lenders review their portfolios. Our resources inevitably mean we are focused on small to medium-sized opportunities but that is something that has served us well to date. I look forward to making further progress in the second half of 2014.

Jonathan Lander

Chief Executive

22 September 2014

Financial Review

This financial review covers the Group's performance during the period ended 30 June 2014. It should be read in conjunction with the Chairman's and Chief Executive's Statements.

The comparable period to 30 June 2013 has been re-presented to reflect the disposal of Interactive Prospect Targeting Limited ("IPT") in December 2013. The results for IPT have been re-presented as discontinued operations in that earlier comparable period, as well as having been treated as such for the year ended 31 December 2013.

Revenue and operating performance

The Group's revenue for the period was £9.83 million, an increase of £5.32 million over the prior period (30 June 2013: £4.51 million; 31 December 2013: £16.14 million). This increase was principally due to revenue growth of £0.93 million in Shire Foods Limited ("Shire") coupled with the inclusion of JMP Consultants Limited ("JMP") for the whole of the first half (accounting for additional revenue of £4.35 million).

The Group operating loss for the period, stated after a one-off share-based payment expense of £0.16 million, was £0.29 million (30 June 2013: loss £0.54 million, 31 December 2013: profit £0.05 million, stated after a one-off gain on bargain acquisition of £0.42 million). The improvement reflects the contribution made by JMP for the longer period as well improved performances in each of Shire and Sira Defence & Security Limited ("SDS"). Further comment on each segment is set out below.

There were certain costs incurred in 2014 (amounting to £0.18 million) relating to the disposal of IPT and which have been disclosed as relating to discontinued operations in the consolidated income statement.

Detailed information about the Group's segments is set out in note 2 to these interim results and should be read in conjunction with this financial review.

Transport planning and engineering consultancy

JMP was acquired during May 2013 and its results for the period ended 30 June 2013 therefore represented approximately 6½ weeks trading. A summary of JMP's recent financial performance is set out in Table A below.

At the period end the Group had working capital loans (including accrued interest) outstanding to JMP of £0.98 million. JMP's unaudited net assets at the period end (stated before deduction of the Group loans) were £1.94 million.

Security solutions

SDS' performance improved in the period, with revenue of £0.15 million (30 June 2013: £0.10 million, 31 December 2013: £0.18 million). The profit before tax was £0.06 million, compared with breakeven results for the prior period and year. The improved performance enabled SDS to repay £0.10 million of Group loans, leaving a balance of £0.09 million outstanding.

Food manufacturing

A summary of Shire's recent financial performance is set out in Table B below.

Profitability is heavily dependent on the revenue generated in the second half of a year. In spite of this, however, the loss for the first half of 2014 reduced by 49% compared to the first half of 2013.

Shire has secured an increased invoice discounting facility which will help support the growth in sales. The Group does, however, continue to provide working capital loans to meet (in particular) inventory growth to provide buffer capacity - and this year the requirement for that has increased as a result of the growth in sales. At 30 June 2014 the Group's loans outstanding were £1.91 million (30 June 2013: £1.52 million, 31 December 2013: £2.37 million) which with the equity and related intellectual property investments made of £0.53 million and £0.44 million respectively, brings the Group's total amount invested to £2.88 million.

The creditors' voluntary arrangement ("CVA") which Shire entered into in January 2012 is scheduled to complete early in 2015. Assuming it runs to its full term, this will reduce unsecured liabilities at that time by approximately £0.85 million. Until such time as these sums have been paid, the CVA creditor liabilities remain in the statement of financial position (at 30 June 2014: £0.92 million).

Shire's unaudited net assets, stated before deducting the Group loans referred to above (but after deducting

the CVA creditor), amounted to £4.08 million as at 30 June 2014 (of which 20% is attributable to non-controlling interests). Since the period end the Group has continued to make further loans to Shire to meet working capital requirements for the second half of 2014.

Investment revenues and Other gains and losses

During 2013 the Group held available for sale investments which generated investment income of £0.26 million and which, upon their disposal in 2013, resulted in gains on sale of £0.30 million. In 2014 the Group has held the majority of its funds for investment in cash.

Discontinued operations

In the first half of 2014 there were costs amounting to £0.18 million incurred relating to the disposal of IPT and which have been classified as relating to discontinued operations. There are no such further costs expected.

Statement of financial position

Cash and cash equivalents

Cash at the period end was £11.13 million (30 June 2013: £2.09 million, 31 December 2013: £11.28 million). The increase in cash compared to the comparable interim reporting period reflects the disposal of certain available for sale investments in the second half of 2013. Details of cash movements are shown in the consolidated statement of cash flows.

Available for sale investments

At the period end the Group had available for sale investments with a market value of £1.04 million (30 June 2013: £10.21 million, 31 December 2013: £0.96 million); the base cost of these investments was £0.69 million (31 December 2013: £0.69 million).

In line with the Group's treasury management policies and pending investment in other acquisitions, the Group continues to consider short term investments where there is the opportunity for attractive yields.

Loss per share and share capital

The basic and diluted loss per ordinary share from continuing operations was 8.09 pence (6 months ended 30 June 2013: basic and diluted loss per share 7.37 pence, Year ended 31 December 2013: basic and diluted earnings per share 10.68 pence and 10.66 pence respectively). Total basic and diluted loss per ordinary share for the period was 12.30 pence (6 months ended 30 June 2013: basic and diluted loss per share 19.09 pence, Year ended 31 December 2013: basic and diluted earnings per share 15.14 pence and 15.11 pence respectively).

During the period the Group purchased a further 104,000 Ordinary Shares of £0.0000001 each, which were subsequently held in treasury, for a total consideration including costs of £0.28 million, representing an average price per Ordinary Share of 267 pence.

Hedging

It is not the Group's policy to enter into derivative instruments to hedge interest rate risk.

Risk factors

The Company and Group face a number of specific business risks that could affect the Company's or Group's success. The Company invests in distressed businesses and securities, which by their nature, often carry a higher degree of risk than those that are not distressed.

The Group's security solutions and transport planning and engineering businesses are principally engaged in the provision of services that are dependent on the continued employment of the Group's employees and availability of suitable profitable workload.

In the food manufacturing segment, there is a dependency on a small number of customers and a reduction in the volume or range of products supplied to those customers or the loss of any one of them could impact the Group materially. The food manufacturing segment is exposed to raw material and commodity cost increases and is dependent on the availability of credit facilities on appropriate terms from lenders and suppliers as well as being dependent on the reliability and performance of the plant and equipment used in the business. Failure or unreliability of key plant or equipment could be material in terms of lost production output or other losses arising from non-supply of products and there is the risk that any or all of the costs, timescales or the non-availability of funding required to enable rectification, would render the segment unviable, with a material effect on the Group.

Key performance indicators ("KPIs")

The Group uses key performance indicators suitable for the nature and size of the Group's businesses.

The key financial performance indicators are revenue and profit before tax. The performance of the Group and the individual trading businesses against these KPIs, is outlined above and disclosed in note 2.

Internally, management uses a variety of non-financial KPIs as follows: in respect of the food manufacturing sector order intake, manufacturing output and sales are monitored weekly and reported monthly; in the transport planning & engineering segment staff utilisation, amounts billed to clients and cash collected are closely monitored; order intake is monitored weekly and reported monthly in respect of the security solutions segment.

Nick Lander

Chief Financial & Operating Officer

22 September 2014

Consolidated income statement

Consolidated statement of comprehensive income

Consolidated statement of changes in equity

Consolidated statement of financial position

Consolidated statement of cash flows

Volvere plc

Notes forming part of the unaudited interim results for the period ended 30 June 2014

1 Financial information

The financial information for the period ended 30 June 2014 and the comparative figures for the period ended 30 June 2013 have not been reviewed or audited by the Group's auditors and have been prepared on the basis of the accounting policies adopted by the Group under IFRS. The same accounting policies and methods of computation are followed in the interim financial report as published by the company on 28 May 2014 in its annual financial statements, which are available on the Company's website at www.volvere.co.uk.

The comparative figures for the year ended 31 December 2013 have been prepared under IFRS. They do not constitute statutory accounts as defined by the Companies Act 2006. The accounts for the 12 months ended 31 December 2013 received an unmodified auditor's report and have been filed with the Registrar of Companies.

Copies of this statement will be available to members of the public at the Company's registered office: Abacus House, 33 Gutter Lane, London, EC2V 8AS and on its website www.volvere.co.uk.

2 Operating segments

Analysis by business segment (excluding inter-segment trading and balances):

Note (b) The profit before tax in respect of the Transport planning and engineering segment is stated after a one-off gain on bargain acquisition of £417,000.