25 Jul 2012 11:57
WORLD TRADE SYSTEMS PLC
CONDENSED UNAUDITED INTERIM FINANCIAL STATEMENTS
For the Six months ended 31 March 2012
|
Contents Page
Operating and Financial Review 2
Condensed Statement of Comprehensive Income 4
Condensed Statement of Financial Position 5
Condensed Statement of Changes In Equity 6
Condensed Cash Flow Statement 6
Notes to the Condensed Financial Statements 7
NON-EXECUTIVE CHAIRMAN'S REVIEW
INTRODUCTION
The Company had no trading activities in the six month period from 1 October 2011 to 31 March 2012.
TRADING PROSPECTS
The directors have been continuously reviewing and considering business opportunities for the Company and shareholders will be kept informed of all material developments as and when they occur.
FINANCIAL REVIEW FOR THE PERIOD
Results
The loss for the period of £48,000 (2011: £49,000) arises from administrative expenses and charges.
Net liabilities as at 31 March 2012 were £717,000 (2011: £620,000).
Treasury and Financial Instruments
The Company has no financing facility with its bankers. It focuses on cash flows and monitors cash balances and requirements on a monthly basis.
On 15 May 2006 the Company obtained interest free unsecured loans totalling £120,000. These loans were repayable on demand and were due to be repaid on 31 March 2008. Since that date these loans have accrued interest at a rate of 6% per annum. On 8 May 2012, Emporium Investment Holding Limited issued a demand for repayment of the sum of £60,000 loaned by it to the company together with accrued interest.
Kudrow Finance Limited, the ultimate parent company ("Kudrow") has provided an undertaking to the company to discharge the loans obtained subject to it having the right to negotiate terms of settlement. In accordance with this undertaking, settlement terms are being negotiated.
The Company has an unsecured loan of £545,800 from Kudrow including £60,800 advanced on 20 January 2012 ("the new loan").
Under the terms of a loan agreement dated 20 January 2012 the new loan carries interest at the rate of 5% per annum and the earlier loans totalling £485,000 carry interest from 12 February 2010, at the rate of 5% per annum. Under the terms of this loan agreement the repayment date for all loans has been extended to the later of 31 March 2013 or the date on which shareholder approval is obtained for the acquisition by the Company of a new business. In the event of a default in payment of capital and or interest the loans will be rolled up into the principle loan from the date of default and shall carry interest at the rate of 10% per annum.
Kudrow has unconditionally undertaken to provide such further financial support as may be required.
At 31 March 2012 the Company had cash on deposit with its bankers of £26,535 (2011: £46,629), and £36,246 held in a client account with Robert Lee Law Offices, Hong Kong (2011:£7,742).
Dividend Policy
The Directors take a prudent approach to dividend payments and will make payments only when commercially viable to do so, subject to the availability of distributable reserves.
Going concern
Having regard to cashflow forecasts prepared in March 2012, the Directors consider that the Company has sufficient liquid resources to meet its financial requirements for the period up to 31 March 2013 when existing loans fall due for repayment. Thereafter the Company is reliant upon further financial support from the loan providers and the Directors will review alternative options at that time.
Taking account of these factors the directors are satisfied that the Company has adequate resources to continue as a going concern for the foreseeable future.
Statement of Directors' responsibilities
The Directors of World Trade Systems plc confirm that to the best of their knowledge these condensed interim financial statements have been prepared in accordance with IAS 34 as adopted by the European Union, and the Chairman's Review includes a true and fair view of the assets, liabilities, financial position and results of World Trade Systems plc as required by the Disclosure and Transparency Rules (DTR) 4.2.4 and a fair view of the information required by DTR 4.2.7 and DTR 4.2.8.
……………………………………
Robert Lee
Non Executive Chairman
20 June 2012
CONDENSED STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTHS ENDED 31 MARCH 2012
Note | 6 months to 31 March 2012 (Unaudited) | 6 months to 31 March 2011 (Unaudited) | Year ended 30 September 2011 (Audited)
| |||
£'000 | £'000 | £'000 |
| |||
| ||||||
| ||||||
Continuing operations |
| |||||
| ||||||
Operating income | 1 | 1 | 3 |
| ||
Administrative expenses | (33) | (35) | (70) |
| ||
______ | ______ | ______ |
| |||
| ||||||
Loss from operations | (32) | (34) | (67) |
| ||
Finance costs |
(16) |
(15) |
(31) |
| ||
______ | ______ | ______ |
| |||
Loss before tax | (48) | (49) | (98) |
| ||
Income tax expense |
6 |
- |
- |
- |
| |
______ | ______ | ______ |
| |||
Total comprehensive income for the period Attributable to equity holders
|
(48)
|
(49)
|
(98) ______ |
| ||
Earnings per share |
| |||||
Basic and diluted loss per ordinary share | 4 | ( 0.54p) | (0.54p) | (1.120p) |
| |
______ | ______ | ______ |
| |||
| ||||||
|
CONDENSED STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2012
|
Note
| As at 31 March2012 (Unaudited) | As at 31 March 2011 ( Unaudited)
| As at 30 September 2011 (Audited) | |
£'000 | £'000 | £'000 | |||
Assets | |||||
Non-current assets | |||||
Investment property | 7 | 40 | 40 | 40 | |
________ | _______ | _______ | |||
40 | 40 | 40 | |||
________ | _______ | _______ | |||
Current assets | |||||
Trade and other receivables | - | 5 | 4 | ||
Cash and cash equivalents | 64 | 54 | 34 | ||
_______ | ______ | _______ | |||
64 | 59 | 38 | |||
_______ | ______ | _______ | |||
Total assets | 104 | 99 | 78 | ||
_______ | ______ | _______ | |||
Current liabilities | |||||
Trade and other payables | (62) | (53) | (64) | ||
Financial Liabilities - borrowings | 8 | (759) | (666) | (683) | |
______ | _____ | _______ | |||
Total liabilities | (821) | (719) | (747) | ||
______ | _____ | _______ | |||
Net Liabilities | (717) | (620) | (669) | ||
______ | _____
| ______ | |||
Equity | |||||
Share capital | 5 | 4,378 | 4,378 | 4,378 | |
Retained earnings | (5,095) | (4,998) | (5,047) | ||
_______ | ______ | _______ | |||
Total deficit of equity attributable to equity holders |
(717) _______ |
(620) ______ |
(669) _______ | ||
CONDENSED STATEMENT OF CHANGES IN EQUITY
FOR SIX MONTHS ENDED 31 MARCH 2012
Share capital |
Retained Earnings |
Total | |||
£'000 | £'000 | £'000 | |||
Balance at 1 October 2011 | 4,,378 | (5,047) | (669) | ||
Loss for the period | - | (48) | (48) | ||
______ | ______ | ______ | |||
Balance at 31 March 2012 | 4,378 | (5,095) | (717) | ||
_____ | ______ | ______ | |||
Balance at 1 October 2010 | 4,378 | (4,949) | (571) | ||
Loss for the period | - | (49) | (49) | ||
______ | ____________ | ______ | |||
Balance at 31 March 2011 | 4,378 | (4,998) | (620) | ||
______ | ______ | ______ | |||
CONDENSED STATEMENT OF CASH FLOWS
FOR THE SIX MONTHS ENDED 31 MARCH 2012
6 months to 31 March 2012 (Unaudited) | 6 months to 31 March 2011 (Unaudited)
| Year ended 30 September 2011 (Audited) | ||
£'000 | £'000 | £'000 | ||
Operating activities | ||||
Net cash used in operating activities | (31) | (54) | (74) | |
Cash flows from operating activities |
|
(31) |
(54) |
(74) |
| ||||
Financing activities | ||||
Proceeds from ultimate parent company loans | 61 | 25 | 25 | |
Cash flows from financing activities |
61 |
25 |
25 | |
___ | _ | ___ | ||
Net change in cash and cash equivalents | 30 | (29)
| (49) | |
Cash and cash equivalents at beginning of period | 34 | 83 | 83 | |
___ | ___ | ___ | ||
Cash and cash equivalents at end of period | 64 | 54 | 34 | |
___ | ___ | ___ | ||
|
Notes to the condensed financial statements
for the period ended 31 March 2012
1. Reporting entity
World Trade Systems plc is a company domiciled in the United Kingdom.
The Company was seeking investment opportunities throughout the period under review. The Company received rental income on freehold agricultural land.
This condensed interim financial report is neither audited nor reviewed by the auditors and was approved by the Board on 20 June 2012.Copies will be available upon request from the Company's registered office at Devonshire House, 1 Devonshire Street, London W1W 5DR or the company's website at www.worldtradesytemsplc.com
The financial information for the year ended 30 September 2011 set out in this interim report does not constitute statutory accounts as defined in Section 434 of the Companies Act 2006. The Company's statutory financial statements for the year ended 30 September 2011 have been filed with the Registrar of Companies. The auditor's report on those financial statements was unqualified and did not contain statements under Section 498(2) or Section 498(3) of the Companies Act 2006.
2. Basis of preparation
These condensed unaudited interim financial statements are for the six month period ended 31 March 2012. They have been prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting" and do not include all of the information required for full annual financial statements.
These interim condensed financial statements have been prepared under the historical cost convention and in accordance with the accounting policies adopted in the Company's last annual financial statements for the year ended 30 September 2011.
The accounting policies have been applied consistently throughout for the purposes of preparation of these condensed financial statements.
3. Going Concern
Whilst the board is active in considering business opportunities for the Company, should such an opportunity not materialise, having regard to the cashflow forecasts prepared in February 2012 the Directors consider that the Company has sufficient liquid resources to meet its financial requirements for the period up to 31 March 2013 when existing loans are due for repayment. Thereafter the Company would be reliant upon further financial support from the loan providers and will review the alternative options at that point in time.
As at 31 March 2012 Kudrow Finance Limited ("Kudrow"), the ultimate parent company, had provided unsecured loans totalling £545,800 including a new loan of £60,800 provided on 20 January 2012. These loans were provided to support the Company's financing requirements. These loans are due to be repaid on the later of 31 March 2013 or the date on which shareholder approval is obtained for the acquisition by the Company of a new business. Kudrow has unconditionally undertaken to provide such further financial support as may be required.
On 15 May 2006 the Company obtained interest free unsecured loans totalling £120,000. These loans were repayable on demand and were due to be repaid on 31 March 2008. Since that date these loans have accrued interest at a rate of 6% per annum. On 8 May 2012, Emporium Investment Holding Limited issued a demand for repayment of the sum of £60,000 loaned by it to the company together with accrued interest.
Kudrow has provided an undertaking to the company to discharge the loans obtained subject to it having the right to negotiate terms of settlement. In accordance with this undertaking, settlement terms are being negotiated.
Taking account of these factors the directors are satisfied that the Company has adequate resources to continue as a going concern for the foreseeable future.
4. Loss per Ordinary Share has been calculated as follows:
6 months to 30 March 2012 |
6 months to 31 March 2011 | ||||
£'000 | £'000 | ||||
This has been calculated on a loss attributable to ordinary shareholders of |
(48)
|
(49)
| |||
The weighted average number of shares listed was: | |||||
Basic and diluted | 8,747,377 | 8,747,377 | |||
5. Called up share capital
At 31 March 2012 | At 31 March 2011 | At 30 September 2011 | |||||
Number | £'000 | Number | £'000 | Number | £'000 |
| |
Authorised |
|
| |||||
Ordinary shares of 1p each Deferred shares of 49p each
|
11,041,237 11,041,237 |
110 5,411_____ |
11,041,237 11,041,237 |
110 5,411 _______ |
11,041,237 11,041,237 |
110 5,411 _____ |
|
5,521 _____ |
5,521 ______ |
5,521 _____
|
| ||||
Allotted, called up and fully paid |
| ||||||
Ordinary shares of 1p each Deferred shares of 49p each |
8,753,867 8,753,867 |
88 4,290 _____ |
8,753,867 8,753,867 |
88 4,290 _____ |
8,753,867 8,753,867 |
88 4,290 _____ |
|
4,378 _____ |
4.378 _____ |
4,378 _____ |
|
The deferred shares do not entitle the holder to payment of any dividend or other distribution or to receive Notice of or attend or vote at any General Meeting of the company or on a return of capital to the repayment of the amount paid on such deferred shares until after repayment of the capital paid up on the Ordinary Shares together with payment of £1,000,000 on each Ordinary Share and the Deferred Shares shall not be capable of transfer at any time other than with the consent of the Directors.
6. Taxation
There is no taxation charge for the six months ended 31 March 2012 (2011: Nil). Unutilised tax losses carried forward are £1,332,000 (2011: £ 1,234,000). A deferred tax asset has not been recognised in respect of these losses, as the conditions for recognition are not evident. The estimated value of the unrecognised deferred tax asset at an average standard rate of 26% (2011: 27%) is £346,000 (2011:£333,000)
7. Investment property
Based on a valuation report dated 4 July 2006 conducted by Savills (L & P) Limited Chartered Surveyors of Winchester, Hampshire the fair value of the Company's investment in freehold land was £110,000. The directors consider that the fair value of the company's investment in freehold land as at 31 March 2012 was £500,000 (2011: £190,000) The rental income earned by the Company from its investment property which is leased out on an agricultural tenancy which continues year to year amounted to £1,500 (2011: £1,500).
8. Financial liabilities - borrowings
Other borrowings comprise unsecured loans totalling £120,000. These loans were repayable on demand and by agreement the repayment date had been extended to 31 March 2008. Under the terms of the agreement the lenders are entitled to charge interest on the Loans at the rate of 6% per annum from the date of the advance on 15 May 2006. Interest accrued in the 6 month period to 31 March 2012 is £3,600 (2011: £3,600).
On 8 May 2012, Emporium Investment Holding Limited issued a demand for repayment of the sum of £60,000 loaned by it to the company together with accrued interest.
Unsecured borrowings from the ultimate parent company total £545,800 and include a new loan of £60,800 obtained on 20 January 2012. The loans carry interest at 5% per annum from 11 February 2010 and fall due for repayment upon the later of 31 March 2013 or the date on which shareholder approval is obtained for the acquisition by the Company of a new business. In the event of a default in payment of capital and/or interest the loans will be capitalised from the date of default and shall carry interest at the rate of 10% per annum. Interest accrued in the 6 month period to 31 March 2012 is £12,680 (2011: £11,764).
9. Related party Transactions
Kudrow Finance Limited, the ultimate parent company, has provided unsecured, loans totalling £545,800 (2011: £485,000), which have been sourced from Glory Time Holdings Inc, a company under the control of a non-executive Director Antares Cheng. The loans fall due for repayment upon the earlier of 31 March 2013 or the date on which shareholder approval is obtained for the acquisition by the Company of a new business.
Directors' transactions
Robert Lee a non-executive Director is the principal of Robert Lee Law Offices which at 31 March 2012 operated a designated trust account for the benefit of the Company and held funds amounting to £36,246 (2011: £7,742). At 31 March 2012 the Company owed Robert Lee £ 11,700 in respect of unpaid director's fees (2011: £10,700). Proclass Limited, a company incorporated in the British Virgin Islands is a Corporate Director of Kudrow Finance Limited, the ultimate parent company. Robert Lee is a director of Proclass Limited and by virtue of this office is able to influence the decision making process of Kudrow Finance Limited.
Antares Cheng a non-executive Director is the controlling shareholder in Glory Time Holdings Inc.