Last checked at 7 Aug 2007 07:00
7 August 2007 XP Power Limited ("XP" or "the Group") Interim Results for the six months ended 30 June 2007 XP, one of the world's leading providers of power supply solutions to theelectronics industry, today announces its interim results for the six-monthperiod ended 30 June 2007. Six months ended Six months ended 30 June 2007 30 June 2006 (Unaudited) (Unaudited) Income and Expenditure Revenue ‚£34.2m ‚£38.8m Gross profit ‚£14.0m ‚£13.9m Gross margin 40.9% 35.8%
Profit before tax, amortisation of ‚£4.4m
‚£4.3m
intangibles ‚£0.1 million (2006: ‚£0.1 million) and reorganisation costs ‚£2.3
million (2006: ‚£0.7 million) Profit before tax ‚£2.0m ‚£3.5m Basic earnings per share 7.4p 14.0p Diluted earnings per share 7.3p 13.8p Diluted earnings per share adjusted for 17.3p
16.9p
the amortisation of intangibles and reorganisation costs (refer to note 6) Interim dividend per share (refer to note 5) 9.0p
8.0p
* Relocation of headquarters to Singapore is complete
* Interim dividend raised 12.5% to 9.0p (2006: 8.0p) per share underlining
confidence in future prospects
* Own brand revenue increased by 11%. Third party revenue down 43% due to the
decision to terminate a number of third party lines in 2006.
* Gross margin of 40% achieved on target reflecting the focus on own brand
business, now representing 73% of total revenues (2006: 58%)
Larry Tracey, Executive Chairman, commented:
"We continue to progress our strategy to capture more value from our sales in challenging market conditions."
Enquiries:
XP Power LimitedLarry Tracey, Executive Chairman 0118 984
5515
James Peters, Deputy ChairmanDuncan Penny, Chief Executive OfficerWeber Shandwick Financial 020 7067
0700
Terry Garrett, Nick Dibden, Hannah Marwood
Notes to editors:
XP provides power supply solutions to the electronics industry.
All electronic equipment needs a power supply. Power supplies convert theincoming AC supply into various levels of DC voltages to drive electroniccomponents and sub-assemblies within the end user's equipment. XP segments itsbusiness into Communications, Defence and Avionics, Industrial and Medical. Byservicing these markets, XP provides investors with access to technology andindustrial sectors of the Worldwide electronics market.
The market is highly fragmented and made up of a large number of Original Equipment Manufacturers who source standard and modified standard power supplies from several hundred power supply companies.
The Investor Presentation covering XP's Interim results will be available on the XP website at 7.00am on 7 August 2007.
For further information, please visit www.xppower.com
Embargoed until 7.00am 7 August 2007
XP Power Limited ("XP" or "the Group") Interim Results for the six months ended 30 June 2007 CHAIRMAN'S STATEMENT I am pleased to report that XP has completed the relocation of its headquartersto Singapore on schedule and we have exceeded our target 40% gross margin. Ourown brand business grew 11% and now represents 73% (2006: 58%) of totalrevenues. The next step in the Group's development is to make us more Asiacentric and expand our manufacturing and supply chain capabilities.
Relocation of Headquarters to Singapore
On 9 November 2006, we announced plans to relocate our headquarters to Asia.Our shareholders approved a Scheme of Arrangement to introduce a new Singaporedomiciled company, XP Power Limited, as the holding company of the Group on 23March 2007 and the reorganisation became effective on 24 April 2007. The Schemeof Arrangement has been accounted for as a reverse acquisition under IFRS 3,Business Combinations and is explained in note 1 to this interim financialinformation.
Given the growing importance of Asia to our target customer base and supply chain, we decided that it was appropriate to move the domicile of the Group holding company to Singapore. We expect more of our customers to migrate their design activities to Asia. We are also expanding our supply chain and manufacturing capabilities to become more competitive and provide better service to our customers. We have moved our centre of operations to Asia to take advantage of the highly educated and well motivated local people.
The costs of making this change of headquarters were ‚£2.3 million and have been disclosed as exceptional reorganisational costs in the income statement. A detailed breakdown of these costs is set out in note 3.
The physical relocation of our headquarters to Singapore was completed during April this year and we are starting to build our supply chain group in this location together with certain technical engineering capabilities.
Financial Performance
Total revenue for the six months ended 30 June 2007 was ‚£34.2 million comparedwith ‚£38.8 million in the same period a year ago. Own brand revenue increased11% to ‚£24.9 million and third party revenue declined 43% to ‚£9.3 million. Aspreviously reported, in the first half of 2006 we decided to terminate a numberof third party lines to focus our resources on our own product lines. Theterminated lines represented approximately ‚£12.0 million of annualised revenue.As expected some of the shortfall has been made up for by the continued growthof our own product lines.
Gross margins were 40.9% in the first half of 2007 compared with 35.8% in the same period a year ago. This is a substantial improvement and justifies our strategic decision to focus on our own product lines.
The overall result is that profit before tax and amortisation of intangibles (‚£0.1 million, 2006: ‚£0.1 million) and reorganisation costs (‚£2.3 million 2006: ‚£0.7 million) was ‚£4.4 million compared with ‚£4.3 million in the same period ayear ago. Basic earnings per share were 7.4 pence compared with 14.0 pence inthe same period a year ago. Diluted earnings per share were 7.3 pence comparedwith 13.8 pence in the same period a year ago. Diluted earnings per shareadjusted for the amortisation of intangibles and reorganisation costs set outabove were 17.3 pence (2006: 16.9 pence).
Dividend
We are once again able to increase the dividend payable to shareholders. TheGroup has declared an interim dividend up 12.5% to 9.0 pence per share for thesix months ended 30 June 2007 (2006: 8.0 pence per share). The interim dividendwill be paid on 3 October 2007 to shareholders on the register at 7 September2007.In accordance with International Accounting Standard 10, dividends are notrecognised in the financial reporting information until they are declared. Thedividend charged to reserves in the interim financial statements in the sixmonths to 30 June 2007 relates to the final dividend of 10.0 pence per sharepaid in respect of the year ended 31 December 2006 (refer to note 5).
Geographic Markets and Industry Segmentation
Trading conditions have been less positive than we expected during the secondquarter of 2007 as many of our customers appear to be seeing some slowing oftheir business and we expect these conditions to carry over into the secondhalf.North American revenues for the period were $33.2 million (or ‚£16.8 million)compared with $37.1 million (or ‚£20.8 million) in the same period a year ago.The weakening of the US Dollar versus Sterling has resulted in a reduction ofapproximately ‚£2.0 million in revenues and approximately ‚£0.2 million on profitbefore tax versus the same period a year ago. On average the US Dollar toSterling exchange rate was 1.98 versus 1.78 in the same period a year ago.Our more mature UK business was most exposed to the termination of the thirdparty lines discussed above. As a result UK revenues in the period declined to‚£9.1 million from ‚£11.5 million achieved in the same period a year ago.
In contrast our Continental European business grew revenues by 13% to ‚£7.2 million compared to ‚£6.4 million in 2006. This was achieved despite the termination of third party lines as we increased market share.
We continue to focus our resources on the higher value customers in our fourmarket sectors: Communications, Defence & Avionics, Industrial and Medical.This focus will ensure that we devote our engineering resources to the rightcustomers and that our current and future product development is carefullytargeted and, above all, customer driven. We believe our move intomanufacturing and focus on our own product IP is helping with the penetrationof these customers.
For the six months ended 30 June 2007, 21% of our revenues came from Communications (2006: 20%), 49% from Industrial (2006: 51%), 22% from Medical (2006: 21%) and 8% from Defence & Avionics (2006: 8%).
Product Development
In May of this year we launched our second worldwide catalogue containing 200pages of XP products and introducing 30 new product families. New productreleases in the period included the highly efficient MFA350 which is a 350 Wattmechanically flexible unit available in a "hot swap" format. This product wasdesigned in our Anaheim design centre and lends itself to value addedapplications which can take advantage of flexible mechanics.Also of note are the much lower power ECL and JCA ranges which are the firstproducts to emerge from our Asian design centre. The ECL family is a range of10 and 15 Watt AC-DC units available as either board mount or encapsulated. Thesize of the units are industry leading. The JCA family is a range of 2 to 6Watt industrial DC-DC converters available in a metal case with industrystandard pin configuration but smaller package.
Generally, the products we are introducing are designed to be highly flexible in terms of the applications they will work in.
Manufacturing
Our manufacturing 50:50 Joint Venture with Fortron Source, located close toShanghai in China, which opened in May 2006 is continuing to perform well. Thefacility has been producing our ECM40, 60 and 100 product families as well asour flagship fleXPower configurable range of power supplies. During the firsthalf of the year we have been concentrating on transferring two new productlines into the facility as well as starting to use lower cost componentproviders which are local to the facility. This should have the benefit ofreducing our lead times and inventory levels.The new facility has been instrumental in allowing us to win business with someof our larger target customers. Against this background we are in discussionswith Fortron Source to purchase their 50% ownership in this venture by the
endof this year.PeopleAs a result of our move to Singapore we have reviewed the make up of our Boardof Directors. On the Scheme of Arrangement becoming effective Roger Bartlettand Paul Dolan stepped down from the Board of XP Power plc. Roger and Paul hadserved our company admirably in their positions as non-executive directors andwe are grateful to them for the advice they have given us.On 24 April 2007 Michael Hafferty was appointed as a non-executive director ofXP. Michael has been the founder and CEO of several technology companies,including Tricom, Vegastream and Arkstream. He was a director of CaseCommunications plc and played a significant role in its IPO on the London StockExchange and as its Sales and Marketing Director built a worldwide sales andservice organisation. Michael is the founder of the consulting companyArkbridge Pte. Limited based in Singapore and as a result of that position wasappointed Vice President, Asia PAC for the international software companyiTRACS Corporation.We are also pleased that Andy Sng has been promoted to our Board of Directorsas General Manager for Asia. Andy joined us in July 2005 to start and head upour Shanghai operations. Over that time Andy has built a strong and capableteam around him, which has enabled us to accelerate the building of our supplychain, quality and technical operations in Asia. Andy has worked in the powersupply industry for eight years in various technical and commercial roles withcompanies such as Silicon Systems (Singapore) and Advanced Micro Devices(Singapore).
We are delighted to welcome Michael and Andy to the Board and anticipate further Asian board appointments.
Auditors
Following the relocation of the Group's headquarters to Singapore in April thisyear we considered that the audit of the Group should take place from Singaporerather than the United Kingdom. A number of Singapore audit firms werecontacted and asked to make a proposal for the position of Auditor of theCompany. After review and careful consideration of the proposals received, theAudit Committee proposes and recommends that the Group changes its Auditor andaccordingly seek Shareholders' approval for the appointment ofPricewaterhouseCoopers, Singapore as the new Auditor of the Group.Under Singapore Law shareholders are required to approve the change of Auditorin a General Meeting. Consequently we will today issue a notice to shareholdersof an Extraordinary General Meeting to be held on 5 September 2007 for thepurpose of appointing PricewaterhouseCoopers, Singapore as the new Auditor ofthe Group.
These interim results have not been audited or reviewed by auditors.
Outlook
Further vertical integration of our business is anticipated from both expansion of existing resources and from further acquisitions.
Given the weakness of the US Dollar and recent softness in our end markets weexpect our revenues for 2007 to be below those achieved in 2006 however ourgross margins as a percent of revenue should show significant improvement forthe year.
We continue to progress our strategy to capture more value from our sales in challenging market conditions.
Larry TraceyExecutive Chairman7 August 2007XP Power LimitedConsolidated Income and Expenditure StatementFor the six months ended 30 June 2007‚£ Millions Note Six months ended Six months ended 30 June 2007 30 June 2006 (Unaudited) (Unaudited) Revenue 2 34.2 38.8 Cost of sales (20.2) (24.9) Gross profit 14.0 13.9 Reorganisation costs 3 (2.3) (0.7) Operating expenses (8.9) (9.1) Operating profit 2.8 4.1 Finance cost (0.8) (0.6) Profit on ordinary activities 2 2.0 3.5 before taxation Tax on profit on ordinary 4 (0.6) (0.9)activities Profit for the period 1.4 2.6 Attributable to:
- equity holders of the company 1.4
2.6 - minority interest - - 1.4 2.6 Basic earnings per share 6 7.4p 14.0p Diluted earnings per share 6 7.3p 13.8p Consolidated statement of recognised income and expense Exchange differences on translation (0.3) (0.9)of foreign operations Net income recognised directly in (0.3) (0.9)equity Profit for the period 1.4 2.6
Total recognised income and expense 1.1
1.7 for the period
All activities derive from continuing operations.
XP Power LimitedConsolidated Balance SheetAt 30 June 2007‚£ Millions Note At 30 June At 31 December At 30 June 2007 2006 2006 (unaudited) (unaudited) Non-current assets Goodwill 29.9 30.1 27.8 Other intangible assets 7 2.9 2.6 2.6 Property, plant and equipment 3.3 3.2 3.4 Interests in associates 0.2 0.1 0.3 Deferred tax asset 0.6 0.6 0.3 36.9 36.6 34.4 Total non-current assets Current assets Inventories 10.5 11.1 8.7 Trade and other receivables 15.6 17.2 18.6 Cash 3.8 4.2 2.6 Derivative financial - 0.1 -instruments 29.9 32.6 29.9 Total current assets Current liabilities (13.1) (21.5) (32.0) Net current assets 16.8 11.1 (2.1)(liabilities) Total assets less current 53.7 47.7 32.3liabilities Non-current liabilities (24.6) (18.3) (4.7) 29.1 29.4 27.6 Net assets Capital and reserves Called up share capital 12 0.2 0.2 0.2 Share premium account 12 27.0 27.0 27.0 Merger reserve 12 0.2 0.2 0.2 Retained earnings 12 1.5 7.5 5.7 Translation reserve 12 0.2 0.4 0.6 Own shares 12 - (5.9) (6.1) Total shareholders' funds 12 29.1 29.4 27.6 Minority interest - - - Total equity 29.1 29.4 27.6
These financial statements were approved by the Board of Directors on 6 August 2007.
XP Power LimitedConsolidated Cash Flow StatementFor the six months ended 30 June 2007‚£ Millions Note Six months ended Six months ended 30 June 2007 30 June 2006 (unaudited) (unaudited)
Net cash inflow from operating 8 2.7
1.0 activities Investing activities Capitalised expenditure on product (0.4) (0.5) development Purchases of property, plant and (0.4) (0.6) equipment Acquisition of associate/subsidiary 11 (1.4) (0.8) Net cash used in investing activities (2.2) (1.9) Financing activities Interest paid (0.8) (0.6) Dividends paid to XP Power (1.9) (1.7) shareholders
Proceeds from sale of own shares 0.4
0.4 Increase in bank loans 5.9 -
(Decrease)/increase in bank overdrafts (4.5) 0.6 Net cash used in financing activities (0.9) (1.3) Net decrease in cash (0.4) (2.2)
Cash at beginning of the period 4.2
4.8 Cash at the end of the period 3.8 2.6 XP Power Limited
Notes to the Interim Results for the six months ended 30 June 2007
1. Basis of preparation
The interim condensed consolidated financial statements for the six months to30 June 2007 have been prepared on the basis of the accounting policies set outin the Group's latest annual financial statements for the year ended 31December 2006. These accounting policies are drawn up in accordance with theListing Rules of the Financial Services Authority and with InternationalAccounting Standards (IAS) and International Financial Reporting Standards(IFRS) as issued by the International Accounting Standards Board with theexception of IAS 34 Interim Financial Reporting which has not been applied inthese interim condensed consolidated financial statements.The accounting policies used are consistent with those set out on pages 32 to55 of the Annual Report for XP Power plc for the year ended 31 December 2006,together with the accounting policies for the reverse acquisition set outbelow, following the Scheme of Arrangement. There has been no material impactduring the period of new IFRS standards effective for periods beginning on orafter 1 January 2007.The interim condensed consolidated financial statements do not include all theinformation and disclosures required in the annual financial statements andshould be read in conjunction with the group's annual financial statements
asat 31 December 2006.Reverse acquisitionXP Power Limited (`the Company') was incorporated on 12 February 2007. On 24April 2007 the Company became the holding company of XP Power plc pursuant to ascheme of arrangement under section 425 of the Companies Act 1985 (`the Schemeof Arrangement').Under IFRS 3, Business Combinations, this Group reconstruction effected by theScheme of Arrangement has been accounted for as a reverse acquisition of theCompany by XP Power plc. This consolidated financial information issued in thename of the legal parent, the Company, accordingly has been prepared andpresented in substance as a continuation of the financial information of thelegal subsidiary, XP Power plc. The following accounting treatment has beenapplied in respect of the reverse acquisition:a) the assets and liabilities of the legal subsidiary, XP Power plc, are recognised and measured in the consolidated financial information at the pre-combination carrying amounts, without restatement to fair value; b) the retained earnings and other equity balances recognised in the
consolidated financial information reflect the retained earnings and other
equity balances of XP Power plc immediately before the business combination. The results of the period from 1 January 2007 to the date of the business combination are those of XP Power plc, as the Company did not
trade prior to the transaction. However, the equity structure appearing in
the consolidated financial information reflects the equity structure of the legal parent, XP Power Limited, including the equity instruments issued under the Scheme to effect the business combination; and
c) comparative numbers presented in the consolidated financial information
are those reported in the consolidated financial information of the legal
subsidiary, XP Power plc, for the six months ended 30 June 2006 and the
year ended 31 December 2006. The Company had no significant assets, liabilities or contingent liabilities ofits own at the time that the Scheme of Arrangement took effect, and no cashconsideration was paid in respect of the business combination. Under the Schemeof Arrangement the Company issued to the same shareholders the same number ofshares in place of their shareholdings in XP Power plc. Therefore no additionalshares were deemed to be issued by XP Power plc, the legal subsidiary, for thereverse acquisition. Hence the cost of combination is deemed to be nil.Transaction costs relating to the Scheme of Arrangement are included asexceptional reorganisational costs in the consolidated income statement (seenote 3).2. Segmental analysis
The Group operates substantially in one class of business, the provision of power supply solutions to the electronics industry. Analysis of total Group operating profit, net assets, turnover and total Group profit before taxation by geographical region is set out below.
‚£ Millions Six months ended Six months ended 30 June 2007 30 June 2006 (unaudited) (unaudited) Revenue Europe 16.4 17.9 USA 16.8 20.8 Asia 1.0 0.1 Total revenue 34.2 38.8
Profit on ordinary activities before
taxation Europe 2.7 2.7 USA 2.7 2.2 Asia 0.4 -
Interest, corporate operating costs (3.9) (1.4) and amortisation of intangible assets Profit on ordinary activities before 2.0 3.5
taxation At 30 June 2007 (Unaudited) At 30 June 2006 (Unaudited) Europe USA Far Total Europe USA Far Total East East Operating net assets Goodwill 10.0 19.3 0.6 29.9 8.5 19.3 - 27.8 Other intangible 0.8 2.1 - 2.9 1.1 1.5 - 2.6assets Property, plant 2.6 0.5 0.2 3.3 2.7 0.7 - 3.4and equipment Interests in 0.2 - - 0.2 0.3 - - 0.3associates Deferred tax 0.4 0.2 - 0.6 0.3 - - 0.3 Inventories 5.3 5.0 0.2 10.5 4.1 4.6 - 8.7 Trade and other 9.8 5.2 0.6 15.6 11.9 6.7 - 18.6receivables Current (3.9) (5.1) (1.0) (10.0) (5.3) (6.2) - (11.5) liabilities Non-current (4.3) - - (4.3) (4.7) - - (4.7) liabilities Total operating 20.9 27.2 0.6 48.7 18.9 26.6 - 45.5net assets
Operating net assets are defined as net assets adjusted for net borrowings.
‚£ Millions At 30 June 2007 At 30 June 2006 (unaudited) (unaudited) Net assets 29.1 27.6 Net debt 19.6 17.9 Total operating net assets 48.7 45.5 3. Reorganisational Costs
The reorganisation costs associated with the Scheme of Arrangement and move of the parent company and headquarters to Singapore are analysed as follows:
‚£ Millions Relocation 1.0 Legal fees 0.3 Financial advice 0.3 Broker fees 0.3 Reporting accountants 0.2
Stock Exchange, Registrars, printing and other 0.1
costs
Systems configuration and set up 0.1 Total reorganisational costs 2.3 In consideration of relocating themselves and the parent company to Singapore apayment of ‚£500,000 was made to Duncan Penny and payments of ‚£250,000 made toJames Peters and Larry Tracey. Part of the terms of these payments are that theindividuals concerned have to repay the total amount paid to them should theyleave the Company within one year of the date the Scheme of Arrangement becameeffective or repay half of the amount paid to them should they leave theCompany within one to two years of the date the Scheme of Arrangement becameeffective. Full details of these arrangements are set out in the Circular toShareholders and Prospectus both dated 21 February 2007.
Reorganisational costs of ‚£0.7 million in the six month period ended 30 June 2006 relate to the termination of the third party lines discussed in the Chairman's statement.
4. Taxation
Income tax expense is recognised based on management's best estimate of the weighted average annual income tax rate expected for the full financial year. The estimated average annual tax rate used for 2007 is 25% (2006: 25%)
‚£ Millions Six months ended Six months ended 30 June 2007 30 June 2006 (unaudited) (unaudited) Singapore - - UK taxation - 0.2 Other overseas taxation 0.6 0.7 Total taxation 0.6 0.9 5. DividendsAmounts recognised as distributions to equity holders of the parent in theperiod: Six months ended Six months ended 30 June 2007 30 June 2006 (unaudited) (unaudited) Earnings Pence per ‚£ Millions Pence per ‚£ Millions share share Prior year final dividend 10.0 1.9 9.0 1.7 The dividend payable recognised in the interim financial statements relates tothe 2006 year-end dividend.Proposed interim dividend 9.0 1.7 8.0 1.5
The interim dividend of 9.0 pence per share (2006: 8.0 pence per share) will be paid on 3 October 2007 to shareholders on the register of members on 7 September 2007.
6. Earnings per share
The calculation of the earnings per share is based on the following data:
Six months Six months ended ended 30 June 2007 30 June 2006 (unaudited) (unaudited) Earnings ‚£ Millions ‚£ Millions
Earnings for the purposes of basic and diluted 1.4
2.6
earnings per share (profit for the financial
period) Amortisation of intangibles 0.1 0.1 Reorganisation costs 2.3 0.7 Tax effect from reorganisation (0.5)
(0.2)
Earnings for adjusted earnings per share 3.3
3.2 Number of shares Number Number Weighted average number of shares (thousands) 18,869 18,590(basic)
Impact of share options (thousands) 221
298
Weighted average number of shares (thousands) 19,090 18,888(diluted) Earnings per share from continuing operations Pence per share Pence per share Basic 7.4p 14.0p Diluted 7.3p 13.8p Diluted adjusted for amortisation of 17.3p
16.9p
intangibles and reorganisation costs
The weighted average number of shares excludes 322,904 ESOP (employee share ownership plan) shares (2006: 350,239) and 930,840 (2006: 1,763,862) treasury shares.
On 19 April 2007 all shares remaining in treasury which totalled 1,462,325 were cancelled prior to the Scheme of Arrangement becoming effective.
7. Other intangible assets
Other intangible fixed assets comprises development expenditure capitalised when it meets the criteria laid out in IAS 38 (refer to Accounting Policies), trademarks and non-contractual customer relationships.
8. Reconciliation of operating profit to net cash inflow from operatingactivities‚£ Millions Six months ended Six months ended 30 June 2007 30 June 2006 (unaudited) (unaudited) Operating profit (excluding 2.8 4.1 associates) Adjustments for: Amortisation of intangibles 0.1 0.1 Depreciation 0.3 0.3 Foreign currency differences (0.3) (0.3) Operating cash flows before 2.9 4.2 movements in working capital Decrease/(increase) in inventories 0.5 (0.6) Decrease/(increase) in receivables 1.6 (1.4) (Decrease) in payables (1.8) (0.2) Cash generated by operations 3.1 2.0 Tax paid (0.5) (1.0)
Net cash inflow from operating 2.7 1.0
activities 9. Borrowings
In September 2006 the Group renewed its annual working capital facility of ‚£10.0 million. At that time the Group also replaced its ‚£15.0 millionmulticurrency revolving credit facility with a ‚£10.0 million term loanrepayable over 5 years and a ‚£5.0 million revolving credit facility committedfor 3 years. Both of these facilities are with Halifax Bank of Scotland and arepriced at LIBOR plus a margin linked to certain covenants, which ranges from1.0% to 1.5%.
The ‚£10.0 million term loan is repayable ‚£2.5 million in year 3, ‚£2.5 million in year 4 and ‚£5.0 million in year 5.
In February 2007 the Group reduced the ‚£10.0 million working capital facilitywith Halifax Bank of Scotland to ‚£4.0 million at the same time as it increasedthe committed term loan from ‚£10.0 million to ‚£16.0 million, with theadditional ‚£6.0 million to be repaid in year 5, making the total amount of theyear 5 repayment ‚£11.0 million. The ‚£5.0 million revolving credit facilityremained unchanged.10. Own sharesOwn shares includes 207,131 (December 2006: 393,051; June 2006: 384,331) sharesin the Group's employee share ownership plan (ESOP). These shares are carriedat the lower of cost and market value.
At 30 June 2006 own shares also included 1,691,375 treasury shares. All treasury shares were cancelled on 19 April 2007 prior to the Scheme of Arrangement becoming effective.
11. Acquisitions
During the period the Group paid ‚£1.4 million representing the outstandingamount due to the shareholders of Powersolve Electronics Limited for anadditional 30.3% of the outstanding shares. XP Power Limited now owns 69.7% ofthe outstanding shares of Powersolve Electronics Limited and is committed topurchasing the remaining 30.3% in 2012.
12. Share capital and reserves
‚£ Millions Share Share Merger Own Translation Retained Total capital premium reserve shares reserve earnings At 1 January 2007 0.2 27.0 0.2 (5.9) 0.4 7.5 29.4(audited) Cancellation of own - - - 5.9 - (5.9) -shares Gain on disposal of - - - - - 0.4 0.4shares Exchange differences - - - - (0.2) - (0.2)on translation of overseas operations Profit for the period - - - - - 1.4 1.4to 30 June 2007 Dividends (note 4) - - - - - (1.9) (1.9) At 30 June 2007 0.2 27.0 0.2 - 0.2 1.5 29.1(unaudited) Under the court-approved Scheme of Arrangement effected on 24 April 2007 (seenote 1), the Company issued a new ordinary share for every existing ordinaryshare in XP Power plc. On 19 April 2007, shortly before the Scheme ofArrangement became effective, XP Power plc cancelled the entire 1,462,325shares it held in treasury which could not participate in the Scheme ofArrangement.After the Scheme of Arrangement became effective on 24 April 2007 there were19,242,296 ordinary shares in issue, at a nominal value of 1 pence per ordinaryshare.
As explained in note 1 the 2006 comparative figures in this statement are those reported in the consolidated information of XP Power plc.
XP POWER PLC