ZOL.L Regulatory News (ZOL)

8 Aug 2008 10:03



8 August 2008

Crosby Asset Management Inc.

(the 'Company' or 'CAM' and together with its subsidiaries the 'Group')

Interim Results - Six months ended 30 June 2008

 

Summary Financials 

 

Turnover 2008: US$17.6 million, of which US$15.0 million was from continuing operations (2007: US$12.4 million)

 

Loss Attributable to Shareholders 2008: US$46.4 million, of which US$20.7 million was from continuing operations (2007: US$26.3 million)

Shareholder Equity 2008: US$18.8 million (2007: US$71.2 million)

 

Loss Per Share (basic) 2008: US$0.19 (2007: US$0.11)

 

Assets Under Management 2008: US$2.2 billion (2007:US$1.5 billion)

CAM has received notice from a single intermediary that it intends to redeem investments amounting to approximately 30% of the assets under management in the Forsyth fund of funds product range. In the main, the redemptions relate to funds within the Forsyth Funds plc structure listed in Dublin. The redemptions, whilst significant, do not materially affect the Firm's Cayman and Bermuda listed funds and relate to funds that have historically had a minimal impact on CAM's profitability.

Financial Highlights

The 21% increase in turnover from continuing operations is driven by a US$8.9 million contribution from the Forsyth range of multi-manager funds (this business was acquired in September 2007) partially offset by a US$6.0 million decrease at Crosby Wealth Management ("CWM"). 

The loss attributable to shareholders is largely due to a combination of losses on the Company's equity holding in IB Daiwa Corporation ("IBD") and restructuring costs related to the Forsyth multi-manager fund range (including the write-off of goodwill-related costs). These two factors together account for US$29.6 million of the losses.

However, both of these factors are expected to be of reduced influence in future. The restructuring of the Forsyth-related business is almost complete and, during the first six months of the year the Firm substantially reduced it's position in IBD.

At the close of the period, CAM held US$15.2 million of cash and minimal debt.

The US$700 million year-on-year increase in assets under management ("AUM") is mainly due to the Forsyth acquisition and a 20% year-on-year growth in AUM at CWM. However, in early August, after the period under review, the Forsyth Funds plc fund range saw a significant redemption from a single intermediary.

Business Highlights

The change of name from Crosby Capital Partners Inc. to Crosby Asset Management Inc. ("CAM') and the restructuring of the business to position CAM as a 'pure-play' asset management company were successfully completed during the second quarter.

Over the six months ended 30 June 2008, CAM sold 61,550,000 shares of IBD realizing proceeds of US$11,468,065. As at the date of this report, CAM owns 20,850,000 IBD shares representing 4.96% of its issued share capital.

CAM's distribution and investment management teams were significantly enhanced by the appointment of four experienced sales people and three investment managers, all with proven track records of building multi-manager fund businesses.

During the first half of 2008, AUM within the Forsyth multi-manager fund range has declined by 35% to US$603 million. As stated above, in early August, after the period under review, the Forsyth Funds plc fund range saw a significant redemption from a single intermediary. This redemption has accelerated the plans to complete the re-engineering of the cost base and the refocus, relaunch and rebrand of the multi-manager business.

At Crosby Wealth Management ("CWM"), AUM showed a small increase in the first six months of the year and the business remained profitable, despite a sharp reversal of market conditions in Asia.

Orchard Petroleum completed a US$240 million long-term financing package. As a result of the completion of this fund raising, the company now owns 100% of the South Belridge Field as opposed to the 50% that was owned through the initial acquisition of Orchard Petroleum. The fund raising also includes a US$110 million facility to enable Orchard to undertake an accelerated drilling programme.

About CAM

CAM is a global asset management group with offices in London, Hong Kong and Singapore. CAM has a diversified portfolio of multi-asset, hedge fund and wealth management businesses. Growth at CAM will be derived from joint-ventures and acquisitions and the organic expansion of existing business lines. CAM is quoted on the AIM market of the London Stock Exchange.

 

Chairman's Report

I am pleased to report that the change of name from Crosby Capital Partners Inc. to Crosby Asset Management Inc. ("CAM') was approved at the Annual General Meeting in May and that we have successfully completed the restructuring of the business, as outlined in the 2007 annual report, to position CAM as a 'pure-play' asset management company. In the first six months of the year, CAM posted a loss attributable to shareholders of US$45.9 million, driven mainly by a combination of continued weakness in the share price of IB Daiwa Corporation ("IBD") and restructuring costs and intangible assets-related write-offs linked to the Forsyth multi-manager fund range. Although it is disappointing to be once again reporting a financial loss, I am encouraged by the strength of the Group's balance sheet in the face of very negative market conditions, and by the continued focus of the executive management team on building a business with a long-term future.

In this respect, I would highlight three developments in particular:

---We significantly enhanced our distribution and investment management teams with the appointment of four experienced sales people and three investment managers, all with proven track records of building fund-of-funds businesses.

---At Crosby Wealth Management ("CWM"), assets under management showed a small increase in the first six months of the year and the business remained profitable, despite a sharp reversal of market conditions in Asia.

---In July, after the end of the reporting period, Orchard Petroleum completed a US$240 million financing programme that enables the company to increase its production base and reserves through a multi-well drilling programme.

During the first half of the year, we significantly reduced our shareholding in IBD. As at the time of writing, our stake had fallen below 5%--the level at which an equity holding is discloseable in Japan. In line with our reduced interest in IBD, Simon Fry and I stepped down from its board of directors. Johnny Chan remains a director. Although, our holding in IBD introduced an unfortunate level of volatility into (and adversely affected) our stock price, overall it was a profitable transaction for the Company.

The first half of the year saw a fall in assets under management within the Forsyth range of funds, due to both client redemptions and declines in fund net asset values. In early August, after the period under review, the Forsyth UCITS III fund range suffered a significant redemption from a single intermediary. The decline in assets under management within certain funds has resulted in those funds becoming uneconomic in their current form. Whilst it is always disappointing to lose assets, these developments have accelerated the implementation of existing plans to complete the re-engineering of the cost base and the refocusing of the product range. These plans will effect a shift from a relatively inflexible, research-led business model with a high fixed cost base to a more responsive, forward-looking distribution-led business model focused on two products: a multi-manager, multi-asset long-only fund and a multi-strategy fund of hedge funds 

The poor performance of CAM's stock price during the first half of 2008 is, of course, partly attributable to the general fall in the share prices of banks and asset management companies. It has nevertheless been very disappointing. However, while the current challenging financial market conditions look set to continue for some time, opportunities have increased within asset management to grow our business through a combination of joint-ventures, acquisition and the organic development of existing product lines.

Robert Owen

Chairman

Chief Executive Officer's Report

Whilst I'm pleased to be writing my first report as CEO of Crosby Asset Management ("CAM"), I am disappointed to be reporting a loss attributable to shareholders for the six months ended 30 June 2008 of US$45.9 million. This loss can largely be attributed to a US$16.4 million mark to market loss on our IB Daiwa Corporation ("IB Daiwa") position, IBD's share price fell from ¥41 at 31 December 2007 to ¥16 at 30 June 2008, and US$13.2 million of restructuring costs, including a write-off of the intangible assets, related to the Forsyth fund-of-fund range.

 

However, both of these factors are likely to be of reduced influence in future. The restructuring of the Forsyth-related business is almost complete and, during the six months ended 30 June 2008, CAM sold 61,550,000 shares of IBD realizing proceeds of US$11,468,065. As at the date of this report, CAM owns 20,850,000 IBD shares representing less than 4.96% of its issued share capital.

 

In contrast, on a more positive, forward-looking, note: turnover increased to US$17.6 million for the six months ended 30 June 2008 (of which US$15.0 million was from continuing operations), compared with US$12.4 million for the same period last year, and assets under management were approximately US$2.2 billion as at 30 June 2008, compared to US$1.5 billion at 30 June 2007. These increases are driven by the growth in the Crosby Wealth Management ("CWM") and the purchase of the Forsyth range of fund-of-fund products in September 2007, and represent an important part of our strategy to build CAM as an asset management company with a diversified portfolio of multi-manager, single-manager and wealth management businesses.

 

As mentioned in the Chairman's report, over the last six months we undertook an extensive reorganisation of the Techpacific/Crosby group to create a more efficient corporate structure. As part of this, the asset management businesses were separated from the merchant banking activities. CAM is now a focused on asset management, with all the assets, such as the IBD shares, our interest in Orchard Petroleum and the Fermiscan licenses, that have been accumulated at CAM as a direct result of our Merchant Banking activities being repackaged as the Crosby Special Situations Fund, in which CAM is the sole shareholder. These assets will be monetized over time to provide CAM the capital to expand its activities. I will continue to report to our shareholders any significant changes and developments within this portfolio.

Although IBD has been a rocky, time consuming and volatile deal for CAM the transaction overall has been very profitable. The businesses that were acquired by IBD, primarily Lodore Resources and Darcy Energy, which was renamed Leed Petroleum PLC and listed on the London AIM market in August 2007, have had mixed fortunes. After many false starts, Lodore did not discover any substantial oil and gas reserves but conversely, Darcy did develop and expand production and reserves quite substantially. With the changes in the markets generally and the length of time it took us to finally obtain IBD's release from the Kanri post we believe that we can reinvest the proceeds from the upside in the IBD shares more productively in building the asset management business.

As a direct result, both our Chairman, Robert Owen, and I have resigned from the IBD board and Johnny Chan, our Group Managing Director, based in Hong Kong, although still an IBD board member, has substantially reduced his time commitment to the company. I believe this change will free us all up to focus on building the core asset management businesses.

Just after this reporting period, Orchard Petroleum completed a US$240 million long-term financing package. As a result of the completion of this fund raising, ESK Limited (the corporate entity that made the original acquisition of Orchard Petroleum) now owns 100% of the South Belridge Field as opposed to the 50% that was owned through the initial acquisition of Orchard Petroleum. The fund raising also includes a US$110 million facility that enables Orchard to undertake an accelerated drilling programme.

The programme commenced in June. It is anticipated that between 30 and 50 new wells will be drilled and bought into production over the next 12 months in the South Belridge Field alone. The total number of wells drilled and the length of time to achieve this objective depends upon the number of rigs that can be contracted. At present two rigs are working full time in South Belridge and the management team's objective is to increase this to four rigs by the end of October. In addition, seven wells have been drilled or completed in the past few months, making a total of 13 wells drilled and either completed or awaiting testing since the end of 2007. Of these wells, at least five are being tied in, and are expected to be bought into production in the coming weeks bringing the total number of producing wells in Orchard to 37. The balance of the wells already drilled will be tested during Q3 and should be tied into production shortly thereafter. A production update will be provided to shareholders after this completion programme.

Apart from the drilling programme noted above in the South Belridge field, a number of development and exploration wells will be drilled in other leased areas that are held by Orchard in the next 12 months. Part of the financing package was used to buy out (and cancel) a 4.25% royalty interest in South Belridge thus increasing net cash flow from the increasing number of producing wells in this field. The sole investor in the US$240million financing of debt and equity is an affiliate of Mercuria Energy Group Ltd, who were part of the original CAM-led consortium that acquired Orchard Petroleum. Following the completion of the financing, CAM's direct shareholding in ESK has been consolidated on a fully diluted basis at 5%. However, this will rise to an effective economic interest of between 9% and 10% after the repayment of principal to preference shareholders. Separately the Crosby Active Opportunities Fund, managed by CAM has a shareholding of approximately 9%. As at June 30, CAM's interest in Orchard was marked at cost. Consequently, with the price of oil and natural gas near their all time highs, CAM's stake in Orchard provides the potential for significant gains which have yet to be reflected in CAM's financial statements. 

After the exceptional performance seen in 2007, activity at Crosby Wealth Management ("CWM") slowed markedly during the six months under review as the turbulence and downward trend in the markets adversely impacted both turnover and margins. Nevertheless, CWM maintained its assets under management and remained profitable during the six months ended 30 June 2008. The ability of CWM to operate profitably in such adverse conditions is particularly encouraging for the long-term future of the business and reflects its flexible cost base.

 

In the first half of the year, through a combination of declines in net asset values broadly in line with the markets and client redemptions, assets under management within the Forsyth range of fund-of-fund products fell by approximately 35% to US$603 million. After the close of the reporting period, the Dublin-listed UCITS III range of traditional long-only funds received a large redemption from a single intermediary. From both an investment manager and shareholder perspective, this latter development has resulted in the AUM within certain funds falling below the level at which the funds are economic. However, during the first six months of 2008, despite the disappointing fall in AUM and a slower pace of change than originally planned, considerable progress was made in restructuring of the business and the recent withdrawal from the Forsyth Funds plc fund range will now act as the catalyst to accelerate our plans to complete the restructuring, the relaunch and the rebranding of the product range. Since the beginning of the year, the cost structure has been re-engineered to lower the fixed cost base and increase the proportion of variable costs and we have begun to re-focus the product range onto two key funds: 

a multi-asset long-only fund and,

a multi-strategy fund of hedge funds. 

The new Multi-Asset long-only fund initiative will be led by the recently appointed, award-winning team of investment managers and be supported by a dedicated distribution team, all of whom have an excellent track record of building and managing businesses within the multi-asset space.

The Multi-strategy fund of hedge funds is managed by the original Forsyth team and is now in the final phase of a radical restructuring. The core funds have performed very well this year and provided positive returns despite the turbulent markets. Following the restructuring and rebranding of the funds over the coming months, we will be in a position to begin pro-actively marketing the funds.

Although some work remains to be done to secure the long-term profitability of the business, the completion of these initiatives will leave CAM well placed to participate in the long-term changes now occurring in the asset management industry.

 

Through the first half of 2008, developments within Crosby Active Opportunities Fund's ("CAOF") core portfolio remained very positive and the long-term value of the Fund's investments continues to be supported by robust business models, strong management teams and a favourable market outlook for the underlying value drivers of food, oil and gas, and precious and base metals. The fund has, however, not been immune from the broad factors impacting capital markets. These factors have been somewhat mitigated however, by a hedging strategy that has sought protection from volatility in the underlying value drivers and general market movements. CAOF continues to actively engage with management and other shareholders with the objective of releasing the intrinsic value in these companies. The net NAV of the fund as at June 2008 was US$1,128.57 per share, down 5.85% year to date. The majority of the decline in NAV is on a mark to market basis and not on a realized basis. CAOF has a total net return of 12.86% since its launch in December 2006.

In February, we announced the set-up of SW1 Capital LP ("SW1"). SW1 was established as a flexible corporate shell to enable us to actively pursue a number of opportunities to build an alternative asset management company that would complement the existing CAM businesses. With the continued deterioration in the financial markets during the second quarter, we were unable to exploit these opportunities as planned. Consequently, SW1 is now effectively dormant. It is always disappointing to report the failure of an initiative to gain sufficient traction to move from an opportunity to a profitable business. However, this is in the very nature of an entrepreneurial enterprise such as CAM where we are constantly looking for new ideas and new opportunities to build our business. In this respect, although I envisage continued turbulence in the financial markets for some time to come, I believe that CAM has the resources and expertise to profit from the inevitable opportunities that such volatility provides.

Simon Fry

Chief Executive Officer

Enquiries:

 

Steve Fletcher

Crosby Asset Management Inc.

020 7858 6161

INDEPENDENT REVIEW REPORT TO CROSBY ASSET MANAGEMENT INC.

Introduction

We have been engaged by the Company to review the condensed set of financial statements in the half-yearly financial report for the six months ended 30 June 2008 which comprises the consolidated income statement, consolidated balance sheet, consolidated statement of changes in equity, condensed consolidated cash flow statement and the related notes 1 to 22. We have read the other information contained in the half yearly financial report which comprises only the Highlights, the Chairman's Report, the Chief Executive Officer's Report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements. 

This report is made solely to the Company in accordance with guidance contained in ISRE (UK and Ireland) 2410, 'Review of Interim Financial Information performed by the Independent Auditor of the Entity'. Our review work has been undertaken so that we might state to the Company those matters we are required to state to them in a review report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company, for our review work, for this report, or for the conclusion we have formed.

Directors' responsibilities 

The half-yearly financial report is the responsibility of, and has been approved by, the directors. 

As disclosed in Note 1, the annual financial statements of the Group are prepared in accordance with IFRSs. The condensed set of financial statements included in this half-yearly 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-yearly financial report based on our review. 

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-yearly financial report for the six months ended 30 June 2008 is not prepared, in all material respects, in accordance with International Accounting Standard 34.

GRANT THORNTON UK LLP

CHARTERED ACCOUNTANTS

BIRMINGHAM

8 August 2008

 

Consolidated Income Statement
				Unaudited six months ended 30 June		Unaudited six months ended 30 June		Audited year  ended 31 December
		2008		2007		2007
		Notes		US$'000		US$'000		US$'000
Continuing operations
Turnover/Revenue		5		14,975		12,224		39,295
Cost of sales				(3,537)		(205)		(2,608)
Gross profit				11,438		12,019		36,687
Profit on financial assets at fair value through profit or loss		18		27		-		-
Loss on financial liabilities at fair value through profit or loss				-		-		-
Other income		6		300		2,566		865
Administrative expenses				(17,498)		(11,817)		(27,875)
Distribution expenses				(3)		(87)		(219)
Restructuring expenses		7		(4,233)		-		-
Other operating expenses				(1,115)		(493)		(847)
Amortisation of intangible assets		15		(314)		-		(123)
Impairment of intangible assets		15		(8,979)		-		-
(Loss)/Profit from operations		8		(20,377)		2,188		8,488
Finance costs				(133)		-		(37)
Excess of fair value over cost of acquired subsidiary				-		-		409
Share of profits/(losses) of associates				69		(80)		(119)
Share of profit of a jointly controlled entity				66		30		-
Loss before taxation				(20,375)		2,138		8,741
Taxation expense		10		(293)		(937)		(2,439)
Loss for the period from continuing operations				(20,668)		1,201		6,302
Discontinued operations
Loss for the period from discontinued operations		11		(25,207)		(18,314)		(26,917)
Loss for the period				(45,875)		(17,113)		(20,615)
Attributable to:
Equity holders of the Company
Loss for the period from continuing operations				(21,162)		(7,995)		(6,994)
Loss for the period from discontinued operations				(25,207)		(18,314)		(26,917)
				(46,369)		(26,309)		(33,911)
Minority interests
Loss for the period from continuing operations				494		9,196		13,296
Loss for the period from discontinued operations				-		-		-
				494		9,196		13,296
Loss for the period				(45,875)		(17,113)		(20,615)
Dividend				-		-		-
Loss per share for loss attributable to equity holders of the Company during the period		12		US cents		US cents		US cents
- Basic				(19.05)		(10.82)		(13.94)
- Diluted				(19.05)		(10.82)		(13.94)

  Consolidated Balance Sheet

		Unaudited 30 June	Unaudited 30 June	Audited 31 December
		2008	2007	2007
	Notes	US$'000	US$'000	US$'000
ASSETS
Non-current assets
Property, plant and equipment	13	2,208	606	1,009
Interests in associates		325	578	314
Interest in a jointly controlled entity		72	45	81
Available-for-sale investments	14	5,222	5,228	5,523
Loan receivable		-	-	463
Intangible assets	15	489	488	8,718
		8,316	6,945	16,108
Current assets
Amounts due from parent and  related companies	16	114	89	169
Trade and other receivables	17	7,648	4,827	8,120
Tax recoverable		75	-	75
Financial assets at fair value through profit or loss	18	183	59,159	43,638
Cash and cash equivalents		15,171	14,249	20,766
		23,191	78,324	72,768
Assets classified as discontinued operations	11	11,360	-	-
		34,551	78,324	72,768
Total assets		42,867	85,269	88,876
LIABILITIES
Current liabilities
Amounts due to parent and  related companies	16	(908)	(100)	-
Trade and other payables	19	(10,129)	(7,515)	(13,977)
Deferred income		(79)	-	-
Provision for taxation		(2,717)	(999)	(2,425)
Current portion of obligations under finance leases		(361)	-	-
		(14,194)	(8,614)	(16,402)
Non-current liabilities
Loan payable		(50)	-	-
Other payable		(838)	-	-
Obligations under finance leases		(822)	-	-
		(1,710)	-	-
Liabilities directly associated with assets classified as discontinued operations	11	(5,067)	-	-
Total liabilities		(20,971)	(8,614)	(16,402)
EQUITY
Share capital	20	2,435	2,433	2,433
Reserves		16,346	68,797	61,772
Equity attributable to equity holders of the Company		18,781	71,230	64,205
Minority interests		3,115	5,425	8,269
Total equity		21,896	76,655	72,474
Total equity and liabilities		42,867	85,269	88,876

Consolidated Statement of Changes in Equity
	Equity attributable to equity holders of the Company
	Share capital	Share premium	Capital reserve	Employee share-based compensation reserve	Foreign exchange reserve	Investment revaluation reserve	Profit and loss account	Total	Minority interests	Total equity
	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000
At 1 January 2008	2,433	6,236	23,455	2,927	165	155	28,834	64,205	8,269	72,474
Exchange difference on consolidation	-	-	-	-	96	-	-	96	-	96
Deficit on revaluation	-	-	-	-	-	(301)	-	(301)	-	(301)
Net income/(loss) recognised directly in equity	-	-	-	-	96	(301)	-	(205)	-	(205)
(Loss)/Profit for the period	-	-	-	-	-	-	(46,369)	(46,369)	494	(45,875)
Total recognised income and expenses for the period	-	-	-	-	96	(301)	(46,369)	(46,574)	494	(46,080)
Issue of new shares upon exercise of share options	2	108	-	(26)	-	-	-	84	-	84
Employee share-based compensation	-	-	-	1,066	-	-	-	1,066	10	1,076
Lapse of share options	-	-	-	(299)	-	-	299	-	-	-
Dividend paid to minority shareholders	-	-	-	-	-	-	-	-	(5,658)	(5,658)
At 30 June 2008	2,435	6,344	23,455	3,668	261	(146)	(17,236)	18,781	3,115	21,896

Consolidated Statement of Changes in Equity
	Equity attributable to equity holders of the Company
	Share capital	Share premium	Capital reserve	Employee share-based compensation reserve	Foreign exchange reserve	Investment revaluation reserve	Profit and loss account	Total	Minority interests	Total equity
	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000
At 1 January 2007	2,427	5,915	23,455	1,976	72	(2)	62,745	96,588	28,152	124,740
Exchange difference on consolidation	-	-	-	-	218	-	-	218	-	218
Surplus on revaluation	-	-	-	-	-	31	-	31	-	31
Net income Recognised directly in equity	-	-	-	-	218	31	-	249	-	249
(Loss)/Profit for the period	-	-	-	-	-	-	(26,309)	(26,309)	9,196	(17,113)
Total recognised income and expenses for the period	-	-	-	-	218	31	(26,309)	(26,060)	9,196	(16,864)
Issue of new shares upon exercise of  share options	6	321	-	(77)	-	-	-	250	-	250
Employee  share-based compensation	-	-	-	452	-	-	-	452	2	454
Dividend paid to Minority shareholders	-	-	-	-	-	-	-	-	(19,339)	(19,339)
Disposal of a Subsidiary undertaking	-	-	-	-	-	-	-	-	(12,586)	(12,586)
At 30 June 2007	2,433	6,236	23,455	2,351	290	29	36,436	71,230	5,425	76,655

  Condensed Consolidated Cash Flow Statement

		Unaudited six months ended  30 June	Unaudited six months ended  30 June	Audited Year ended 31 December
		2008	2007	2007
	Note	US$'000	US$'000	US$'000
Net cash inflow from operating activities
- Continuing operations		2,444	35,021	49,349
- Discontinued operations		918	-	-
		3,362	35,021	49,349
Net cash outflow from investing activities
- Continuing operations		(3,347)	(17,204)	(25,004)
- Discontinued operations		(776)	-	-
		(4,123)	(17,204)	(25,004)
Net cash outflow from financing activities
- Continuing operations		(4,390)	(13,564)	(13,582)
- Discontinued operations		-	-	-
		(4,390)	(13,564)	(13,582)
Net (decrease)/ increase in cash and cash equivalents		(5,151)	4,253	10,763
Cash and cash equivalents as at   start of period		20,766	9,987	9,987
Effect of exchange rate fluctuations		(11)	9	16
Cash and cash equivalents as at end of period		15,604	14,249	20,766

Analyzed into:
- Continuing operations		15,171	14,249	20,766
- Discontinued operations	11	433	-	-
Total		15,604	14,249	20,766

Notes to the interim financial information

 

1. Basis of preparation

The Company acts as the holding company of the Group. The Group is principally engaged in the business of merchant banking and asset management. The address of the Company's registered office is Cricket Square, Hutchins Drive, P. O. Box 2681, Grand Cayman, KY1 -1111, Cayman Islands. The Company's shares are listed on the AIM of the London Stock Exchange.

The Company was incorporated in the Cayman Islands, which does not prescribe the adoption of any particular accounting framework. The Board has therefore adopted International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board. The interim financial information complies with the applicable disclosure provisions of the Rules Governing the Listing of Securities on the AIM of the London Stock Exchange. 

The interim financial information has been prepared on the historical cost basis except for certain financial instruments which are measured at fair value.

It should be noted that accounting estimates and assumptions are used in preparation of the interim financial information. Although these estimates are based on management's best knowledge and judgement of current events and actions, actual results may ultimately differ from those estimates. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the interim financial information, are set out in Note 3 to the interim financial information. 

The interim financial information contained in this report does not constitute statutory accounts within the meaning of Section 240 of the Companies Act 1985. The full accounts for the year ended 31 December 2007 received an unqualified report from the auditors and did not contain a statement under Section 237(2) or (3) of the Companies Act 1985.

The interim financial information is unaudited but has been reviewed by the Company's Auditors. A copy of the Auditor's review report is included within this interim financial information. 

2. Principal accounting policies

The interim report has been prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting".

The principal accounting policies and methods of computation adopted to prepare the interim financial information are consistent with those detailed in the 2007 annual report published by the Company on 13 March 2008 except for the following additional accounting policy only applicable to the six months ended 30 June 2008:

Asset acquired under finance leases

Where the Group acquires the use of assets under finance leases, the amounts representing the fair value of the leased asset, or, if lower, the present value of the minimum lease payments, of such assets are included in fixed assets and the corresponding liabilities, net of finance charges, are recorded as obligation under finance leases.

Subsequent accounting for assets held under finance lease agreements corresponds to those applied to comparable acquired assets. The corresponding finance lease liability is reduced by lease payments less finance charges.

Finance charges implicit in the lease payments are charged to profit or loss over the period of the leases so as to produce an approximately constant periodic rate of charge on the remaining balance of the obligations for each accounting period. Contingent rentals are charged to profit or loss in the accounting period in which they are incurred.

3. Critical accounting estimates and judgements

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

(i)  Critical accounting estimates and assumptions

The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next accounting period are discussed below:

Fair values of financial instruments

Financial instruments such as available-for-sale investments and financial assets at fair value through profit or loss are initially measured at fair value. Certain financial instruments are remeasured at fair value at subsequent reporting dates. The best evidence of fair value is quoted prices in an active market, where quoted prices are not available for a particular financial instrument, the Group uses the market values determined by the internal or external valuation techniques to estimate the fair value. The use of methodologies, models and assumptions in pricing and valuing these financial assets requires varying degrees of judgement by management, which may result in different fair values and results. The assumptions with regard to the fair value of available-for-sale investments and financial assets at fair value through profit or loss are detailed in Notes 14 and 18 to the interim financial information respectively, are those that have the most significant risk of causing a material adjustment to the carrying amounts of assets within the next accounting period.

The only significant assets at fair value through profit or loss not valued at quoted market prices are as follows:

Investments in Sunov Petroleum (Pakistan) Limited (US$1.2 million), which is valued based on a recent transaction.

Investments in ESK Limited (US$1.875 million) which is valued based on the subscription price of the preference shares.

Valuations of share options granted

The fair value of share options granted was calculated using the Binomial option pricing model which requires the input of highly subjective assumptions, including the volatility of share price. Because changes in subjective input assumptions can materially affect the fair value estimate, it is in the opinion of Directors that the existing model will not always necessarily provide a reliable single measure of the fair value of the share options.

Impairment of assets

The Group conducts impairment reviews of assets when events or changes in circumstances indicate that their carrying amounts may not be recoverable annually in accordance with the relevant accounting standards. An impairment loss is recognised when the carrying amount of an asset is lower than the greater of its net selling price or the value in use. In determining the value in use, management assesses the present value of the estimated future cash flows expected to arise from the continuing use of the asset and from its disposal at the end of its useful life. Estimates and judgments are applied in determining these future cash flows and the discount rate. Details of the events and circumstances giving rise to the impairment provision against the value of the intangible assets of US$8.3 million relating to the Forsyth fund-of-funds customer base during the six months ended 30 June 2008 is provided in Note 15 to the interim financial information. 

Impairment of receivables

Management determines impairment of receivables on a regular basis. A considerable amount of judgement is required in assessing the ultimate realisation of these receivables, including the current creditworthiness and the past collection history of each debtor. If the financial conditions of debtors of the Group were to deteriorate, resulting in an impairment of their ability to make payments, additional impairment may be required. 

Current taxation and deferred taxation

The Group is subject to income taxes in various jurisdictions. Significant judgement is required in determining the amount of the provision for taxation and the timing of payment of the related taxation. Where the final tax outcome is different from the amounts that were initially recorded, such differences will impact the income tax and deferred tax provisions in the periods in which such determination are made.

Deferred tax assets relating to certain tax losses will be recognised when management considers it is probable that future taxable profit will be available against which the temporary differences or tax losses can be utilised. Where the expectation is different from the original estimate, such difference will impact, where applicable and appropriate, the recognition of deferred tax assets and taxation in the periods in which such estimate is changed.

Provision for onerous contracts

Provisions are made for onerous contracts where the unavoidable costs of meeting the obligations under the contracts exceed the economic benefits expected to be received under it. Significant judgement is required in determining the amount of the provision where the economic benefits are uncertain as to timing or amount. Where the final outcome is different from the amounts that were initially recorded, such differences will impact the income statement and provisions in the periods in which such determination are made. Details of the circumstances used to determine the provision for the onerous contracts in respect of leases of office premises that are no longer in use by the Group, due to restructuring of its Forsyth Fund-of-Funds business, are detailed in Note 7 to the interim financial information. The present value of the total rentals and management charges under the operating leases amount to US$3.8 million but these are expected to be offset by sub-letting the office premises. The Directors have provided US$1.4 million at 30 June 2008 after estimating the time it would take to sub-let the premises and the rent that may be received from a prospective tenant.

Determining the residual values and remaining useful lives of property, plant and equipment

 

The residual values and remaining useful lives of property, plant and equipment are reviewed by management at each balance sheet date and adjusted if appropriate. A considerable amount of judgement is required in assessing the residual values and remaining useful lives. If the residual value or remaining useful life changes then additional impairment may be required. Details of the events and circumstances giving rise to the reduction of the residual values and the remaining useful lives of certain property, plant and equipment due to the restructuring of the Forsyth fund-of-funds business resulting in an additional depreciation and impairment charge of US$1.9 million during the six months ended 30 June 2008 is provided in Note 7 to the interim financial information.

(ii)  Critical judgements in applying the Group's accounting policies

Management in applying the accounting policies do not consider that they have had to make any significant judgements. 

4. Segment Information

Primary reporting format - business segment:

	Merchant banking			Asset management			Unallocated			Consolidated
	Unaudited six months ended  30 June	Unaudited six months ended  30 June	Audited year ended 31 December	Unaudited six months ended  30 June	Unaudited six months ended  30 June	Audited year ended 31 December	Unaudited six months ended  30 June	Unaudited six months ended  30 June	Audited year ended 31 December	Unaudited six months ended  30 June	Unaudited six months ended  30 June	Audited year ended 31 December
	2008	2007	2007	2008	2007	2007	2008	2007	2007	2008	2007	2007
	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000
Continuing operations
Turnover/Revenue	-	-	-	14,975	12,224	39,295	-	-	-	14,975	12,224	39,295
Segment results	-	-	-	210	4,489	14,445		-	-	210	4,489	14,445
Restructuring expenses	-	-	-	(4,233)	-	-	-	-	-	(4,233)	-	-
Amortisation of intangible assets	-	-	-	(314)	-	-	-	-	-	(314)	-	(123)
Impairment of intangible assets	-	-	-	(8,979)	-	-	-	-	-	(8,979)	-	-
Impairment of receivables	-	-	-	(1,221)	-	-	-	-	-	(1,221)	-	-
Unallocated loss from operations	-	-	-	-	-	-	(5,840)	(2,301)	(5,834)	(5,840)	(2,301)	(5,834)
(Loss)/profit from operations										(20,377)	2,188	8,488
Finance costs										(133)	-	(37)
Excess of fair value over cost of acquired subsidiary										-	-	409
Share of profits/(losses) of associates										69	(80)	(119)
Share of profit of a jointly controlled entity										66	30	-
Loss before taxation										(20,375)	2,138	8,741
Taxation expense										(293)	(937)	(2,439)
Loss for the period from continuing operations										(20,668)	1,201	6,302
Discontinued operation
Loss for the period from discontinued operations	(25,207)	(18,314)	(26,917)	-	-	-	-	-	-	(25,207)	(18,314)	(26,917)
Loss for the period										(45,875)	(17,113)	(20,615)

  

4. Segment Information (Cont'd)

Primary reporting format - business segment (Cont'd):

Continuing operations
Segment assets	-	68,136	50,574	24,225	11,390	29,698	-	-	-	24,225	79,526	80,272
Unallocated assets	-	-	-	-	-	-	7,282	5,743	8,604	7,282	5,743	8,604
	-	68,136	50,574	24,225	11,390	29,698	7,282	5,743	8,604	31,507	85,269	88,876
Discontinued operations
Segment assets	11,360	-	-	-	-	-	-	-	-	11,360	-	-
Unallocated assets	-	-	-	-	-	-	-	-	-	-	-	-
	11,360	-	-	-	-	-	-	-	-	11,360	-	-
Total assets	11,360	68,136	50,574	24,225	11,390	29,698	7,282	5,743	8,604	42,867	85,269	88,876
Continuing operations
Segment liabilities	-	3,864	4,589	8,709	2,182	8,102	-	-	-	8,709	6,046	12,691
Unallocated liabilities	-	-	-	-	-	-	7,195	2,568	3,711	7,195	2,568	3,711
	-	3,864	4,589	8,709	2,182	8,102	7,195	2,568	3,711	15,904	8,614	16,402
Discontinued operations
Segment liabilities	5,067	-	-	-	-	-	-	-	-	5,067	-	-
Unallocated liabilities	-	-	-	-	-	-	-	-	-	-	-	-
	5,067	-	-	-	-	-	-	-	-	5,067	-	-
Total liabilities	5,067	3,864	4,589	8,709	2,182	8,102	7,195	2,568	3,711	20,971	8,614	16,402
Other information
Continuing operations
Capital expenditure	-	14	39	3,375	13	124	1,600	258	652	4,975	285	815
Depreciation	-	-	-	167	30	69	318	107	297	485	137	366
Impairment of receivables	-	-	-	1,221	-	-	-	-	-	1,221	-	-
Discontinued operations
Capital expenditure	7	-	-	-	-	-	-	-	-	7	-	-
Depreciation	7	34	73	-	-	-	-	-	-	7	34	73
Impairment of receivables	186	-	-	-	-	-	-	-	-	186	-	-

Notes:

Discontinued operations: 

i. Merchant Banking - provision of corporate finance and other advisory services and the changes in fair value of 

financial assets and liabilities through profit or loss arising from the Group's merchant banking activities.

 

Continuing operations:

i. Asset Management - provision of fund management, asset management and wealth management services

ii. Unallocated - primarily items related to corporate offices

b. Secondary reporting format -geographical segment:

With regard to the asset management business acquired in September 2007, mainly operated through the Group's key operating subsidiary in the United Kingdom, the Group defines geographical segment with reference to those revenue-producing assets and transactions that arise from customers domiciled worldwide. Due to the nature of the business, precise segregation of geographical activities would be arbitrary and therefore considered not appropriate. The Group's continuing activities during the six months ended 30 June 2008 and 30 June 2007, and the year ended 31 December 2007 are mainly operated or carried out in Asia.

5. Turnover/Revenue - continuing operations

	Unaudited six months ended 30 June 2008	Unaudited six months ended 30 June 2007	Audited year  ended 31 December 2007
	US$'000	US$'000	US$'000
Fund management fee income	9,705	942	10,391
Wealth management services fee	5,270	11,282	28,904
Total	14,975	12,224	39,295

6. Other income - continuing operations

 

	Unaudited six months ended 30 June 2008	Unaudited six months ended 30 June 2007	Audited year  ended 31 December 2007
	US$'000	US$'000	US$'000
Bad debts recovery	1	1	2
Bank interest income	218	183	503
Gain on disposal of an associate	-	-	236
Management and consultancy fee income	64	2,376	24
Other interest income	4	-	5
Others	13	6	95
Total	300	2,566	865

 

7. Restructuring expenses - continuing operations

	Unaudited six months ended 30 June 2008	Unaudited six months ended 30 June 2007	Audited year  ended 31 December 2007
	US$'000	US$'000	US$'000
Impairment of fixed assets	1,904	-	-
Provision for onerous contracts in respect of operating leases	1,364	-	-
Others	965	-	-
Total	4,233	-	-

The Group has reduced staff numbers as part of the restructuring of its Forsyth fund-of-funds business and relocated the remaining staff to its head office, leaving office premises rented under operating leases vacant and available to sub-let. At 30 June 2008, the Group has provided in full against the net carrying value of the furniture and fixtures in those office premises amounting to US$1.0 million. The Group has also made provision for the discounted net present value of the future operating lease rental payments under the operating leases, in so far as they are expected to exceed future anticipated rentals if the premises is sub-let, in the amount of US$1.4 million as this represents an onerous contract. 

As part of the same restructuring, the Group has provided against website, software and system and related development costs in the amount of US$0.9 million given that its main functionality will not be utilised by the Group following the restructuring.

The other costs of US$1.0 million relate to the other costs of restructuring the Forsyth fund-of-funds business.

 

8. Loss from operations - continuing operations

	Unaudited six months ended 30 June 2008	Unaudited six months ended 30 June 2007	Audited year  ended 31 December 2007
	US$'000	US$'000	US$'000
Loss from operations is arrived at after charging:
Auditors' remuneration:
- fee payable to the Company's auditors for the audit of the Company's financial statements	57	50	95
- fee payable to the Company's auditors for the other services:
audit of the Company's subsidiaries pursuant to legislation	75	22	39
taxation services	3	3	4
regulatory assistance	23	22	22
Amortisation of intangible assets	314	-	123
Depreciation - owned assets - assets under finance leases	465 20	137 -	366 -
Impairment of intangible assets	8,979	-	-
Impairment of receivables	1,221	-	-
Operating lease charges in respect of rental premises	1,184	415	903

9. Employee remuneration (including directors' remuneration) - continuing operations

 

	Unaudited six months ended 30 June 2008	Unaudited six months ended 30 June 2007	Audited year  ended 31 December 2007
	US$'000	US$'000	US$'000
Fees	108	50	100
Salaries, allowances and benefits in kind	6,778	3,230	7,207
Commissions paid and payable	1,888	4,276	11,006
Bonus paid and payable	2,743	2,347	4,363
Share-based compensation	983	216	620
Pensions - defined contribution scheme	124	35	474
Social security costs	841	106	412
Total	13,465	10,260	24,182

10. Taxation expense - continuing operations

	Unaudited six months ended 30 June 2008	Unaudited six months ended 30 June 2007	Audited year  ended 31 December 2007
	US$'000	US$'000	US$'000
Current tax
- United Kingdom	-	19	-
- Overseas	293	918	2,439
Total	293	937	2,439

United Kingdom and overseas income tax for the period have been calculated at the rates prevailing in the relevant jurisdictions.

The Group has significant unrelieved tax losses, the utilisation of which is uncertain and consequently no deferred tax asset has been recognised. (30 June 2007 and 31 December 2007: US$Nil).

11. Discontinued operations

	Unaudited six months ended 30 June 2008	Unaudited six months ended 30 June 2007	Audited year  ended 31 December 2007
	US$'000	US$'000	US$'000
Turnover/Revenue	2,612	133	2,046
Cost of sales	(1,527)	-	-
Gross profit	1,085	133	2,046
Loss on financial assets at fair value through profit or loss (Note 18)	(20,613)	(6,028)	(13,727)
Loss on financial liabilities at fair value through profit or loss	-	(443)	-
Other income	384	-	-
Administrative expenses	(5,432)	(5,852)	(10,620)
Other operating expenses	(631)	(6,124)	(4,616)
Loss for the period	(25,207)	(18,314)	(26,917)

	Unaudited 30 June  2008
	US$
Non-current assets
Property, plant and equipment	15
Interest in associates	31
Loan receivable	474
	520
Current assets
Amounts due from parent company and related companies	986
Trade and other receivables	2,500
Financial assets at fair value through profit or loss	6,921
Cash and cash equivalents	433
	10,840
Total assets	11,360
Current liabilities
Amount due to parent company	(376)
Trade and other payables	(4,690)
Provision for taxation	(1)
Total liabilities	(5,067)

During the six months ended 30 June 2008, the Group undertook a restructuring to create a more efficient corporate structure by separating its asset management and merchant banking operations. The staff employed in the Group's merchant banking subsidiaries have transferred their employment on a continuous basis to a subsidiaries of the Group's parent company, Crosby Capital Limited, with effect from 30 June 2008. The financial assets of the Group that were derived from its merchant banking operations were transferred into a 100% subsidiary, Crosby Special Situations Fund Limited ("CSSF") during the quarter ended 30 June 2008. CSSF has entered into a standard performance-linked advisory agreement with Crosby Capital Limited to manage the optimal realization of these investments but will not enter into any new merchant banking transactions.

12. Loss per share

(a) Basic

 

	Unaudited six months  ended  30 June 2008	Unaudited six months  ended 30 June 2007	Audited year  ended 31 December 2007
	US$'000	US$'000	US$'000
Loss attributable to equity holders of the Company	(46,369)	(26,309)	(33,911)

	Number of shares	Number of shares	Number of shares
Weighted average number of shares for calculating basic loss per share	243,389,286	243,195,442	243,235,548

	Unaudited six months ended  30 June 2008	Unaudited six months  ended 30 June 2007	Audited year  ended 31 December 2007
	US cent	US cent	US cent
Basic loss per share	(19.05)	(10.82)	(13.94)

(b) Diluted

No diluted loss per share is shown for the six month ended 30 June 2008 (30 June 2007: US$Nil; 31 December 2007: US$Nil), as the outstanding share options were anti-dilutive.

13. Property, plant and equipment

	Unaudited 30 June	Unaudited 30 June	Audited 31 December
	2008	2007	2007
	US$'000	US$'000	US$'000
Net carrying amount at 1 January	1,009	493	493
Acquisition of the Forsyth Business	-	-	139
Additions	4,982	285	815
Disposals	(1,376)	(1)	(2)
Impairment (Note 7)	(1,904)	-	-
Depreciation for the period/year	(492)	(171)	(439)
Exchange differences	4	-	3
Net carrying amount at 30 June / 31 December	2,223	606	1,009

Analyzed into:
- Continuing operations	2,208	606	1,009
- Discontinued operations	15	-	-
Total	2,223	606	1,009

Included in the net carrying amount of US$2,223,000 (30 June 2007: US$606,000; 31 December 2007: US$1,009,000) is an amount of US$1,112,000 (30 June 2007 and 31 December 2007: Nil) representing the net carrying value of assets held under finance leases.

14. Available-for-sale investments - continuing operations

	Unaudited 30 June	Unaudited 30 June	Audited 31 December
	2008	2007	2007
	US$'000	US$'000	US$'000
Fair value, unlisted investments	5,222	5,228	5,523

The movement in available-for-sale investments is as follows:

	Unaudited 30 June	Unaudited 30 June	Audited 31 December
	2008	2007	2007
	US$'000	US$'000	US$'000
At 1 January	5,523	198	198
Additions	-	4,999	5,175
Disposals	-	-	(7)
Change in fair value recognised directly in equity	(301)	31	157
At 30 June / 31 December	5,222	5,228	5,523

The investments included above represent investments in funds managed by the Group that offer the Group the opportunities for return through dividend income and fair value gains. The fair values of the investments are based on Group's share of the underlying net assets of the fund which are valued at fair value, which is a quoted market price. Subsequent to 30 June 2008, the Group redeemed US$2.5 million from these available-for-sale investments for cash. 

15. Intangible assets - continuing operations

	Unaudited 30 June	Unaudited 30 June	Audited 31 December
	2008	2007	2007
	US$'000	US$'000	US$'000
Net carrying amount at 1 January	8,718	488	488
Acquisition of trademark	-	-	1
Goodwill arising from additional investment in a subsidiary	600	-	-
Acquisition of customer base of the Forsyth Business	464	-	8,352
Amortisation for the period/year	(314)	-	(123)
Impairment for the period/year	(8,979)	-	-
Net carrying amount at 30 June / 31 December	489	488	8,718

The customer base relating to the Forsyth fund-of-funds has been fully provided during the six months ended 30 June 2008 due to faster declines in the total assets under management by the Group relating to the Forsyth fund-of-funds than originally estimated, from approximately US$1 billion at the date of taking on the investment management contracts to approximately US$0.6 billion at 30 June 2008. The decline in the total assets under management relating to the existing customer base arose from a combination of redemptions and the negative performance of certain funds broadly in line with markets. Using the same approach to value the customer base as disclosed in the Company's 2007 Annual Report, with all other assumptions (other than the decline in assets under management) constant, resulted in full provision for impairment being necessary.

16. Amounts due from/(to) parent and related companies - continuing operations

As at 30 June 2008, details of the amounts due from/(to) parent and related companies are set out below:

	Unaudited 30 June	Unaudited 30 June	Audited 31 December
	2008	2007	2007
	US$'000	US$'000	US$'000
Amounts due from investee companies	109	50	112
Amount due from a subsidiary of an investee company	-	-	33
Amounts due from fellow subsidiaries	5	39	9
Amount due from parent company	-	-	15
Total	114	89	169

	Unaudited 30 June	Unaudited 30 June	Audited 31 December
	2008	2007	2007
	US$'000	US$'000	US$'000
Amount due to an investee company	(791)	-	-
Amount due to a subsidiary of an investee company	(91)	-	-
Amount due to a fellow subsidiary	-	(79)	-
Amount due to parent company	(26)	(21)	-
Total	(908)	(100)	-

17. Trade and other receivables - continuing operations

	Unaudited 30 June	Unaudited 30 June	Audited 31 December
	2008	2007	2007
	US$'000	US$'000	US$'000
Trade receivables -gross	3,790	3,408	3,575
Less: impairment losses	(176)	(157)	(166)
Trade receivables - net	3,614	3,251	3,409
Other receivables - gross	763	555	913
Less: impairment losses	-	-	(613)
Other receivables - net	763	555	300
Deposits and prepayments	3,271	1,021	4,411
Total	7,648	4,827	8,120

The fair value of trade and other receivables is considered by the directors not to be materially different from the carrying amounts.

The Group allows a credit period ranging from 15 to 45 days to its asset management clients, where applicable.

At 30 June 2008, included in trade and other receivables are trade receivables of US$3,614,000 (30 June 2007: US$3,251,000; 31 December 2007: US$3,409,000) aged as follows:

	Unaudited 30 June	Unaudited 30 June	Audited 31 December
	2008	2007	2007
	US$'000	US$'000	US$'000
0 - 30 days	2,787	2,829	3,064
31 - 60 days	538	422	345
61 - 90 days	289	-	-
Total	3,614	3,251	3,409

 18. Financial assets at fair value through profit or loss

		Unaudited 30 June 2008	Unaudited  30 June  2007	Audited 31 December 2007
	Notes	US$'000	US$'000	US$'000
Held for trading
Listed securities:
- Equity securities - Australia	(1)	19	5,528	3,520
- Equity securities - Japan	(2)	3,795	41,533	31,672
- Equity securities - United Kingdom	(3)	183	6,891	330
Fair value of listed securities		3,997	53,952	35,522
Unlisted securities:
- Equity securities - Australia	(4)	35	-	1,134
- Equity securities - British Virgin Islands	(5)& (6)	3,072	5,107	6,982
Fair value of unlisted securities		3,107	5,107	8,116
Sub-total		7,104	59,059	43,638
Designated as financial assets at fair value through profit or loss on initial recognition
Unlisted securities:
- Equity securities - United Kingdom		-	100	-
Total		7,104	59,159	43,638

Analyzed into:
- Continuing operations		183	59,159	43,638
- Discontinued operations		6,921	-	-
Total		7,104	59,159	43,638

  The movement in financial assets at fair value through profit or loss is as follows:-

	Unaudited six months ended 30 June	Unaudited six months ended 30 June	Audited year  ended 31 Dec
	2008	2007	2007
	US$'000	US$'000	US$'000
At 1 January	43,638	127,542	127,542
Additions	165	252	3,787
Transfer from disposal of a subsidiary undertaking	-	320	320
Disposal of a subsidiary undertaking	-	(15,540)	(15,539)
Other disposals	(16,112)	(5,347)	(16,591)
Dividend received	(1)	(42,040)	(42,154)
Gain/(Loss) on financial assets at fair value through profit or loss Continuing operations - Discontinued operations (Note 11)	27 (20,613)	(6,028) -	(13,727) -
At 30 June/ 31 December	7,104	59,159	43,638

Notes:

 

19. Trade and other payables - continuing operations

		Unaudited	Unaudited	Audited
		30 June	30 June	31 December
		2008	2007	2007
		US$'000	US$'000	US$'000
Trade payables		1,043	21	2,330
Other payables		541	99	842
Accrued charges		8,545	7,395	10,805
Total		10,129	7,515	13,977

The fair value of trade and other payables is considered by the directors not to be materially different from carrying amounts.

At 30 June 2008, included in trade and other payables are trade payables of US$1,043,000 (30 June 2007: US$21,000; 31 December 2007: US$2,330,000) aged as follows:

		Unaudited	Unaudited	Audited
		30 June	30 June	31 December
		2008	2007	2007
		US$'000	US$'000	US$'000
0 - 30 days		1,041	19	1,746
31 - 60 days		-	-	264
61 - 90 days		-	2	320
Over 90 days		2	-	-
Total		1,043	21	2,330

20. Share capital 

	Number of ordinary shares	Value US$'000
Authorised (par value of US$0.01 each)	5,000,000,000	50,000
Issued and fully paid (par value of US$0.01 each)
At 30 June 2007 and 31 December 2007	243,275,000	2,433
Issue of shares on exercise of share options	200,000	2
At 30 June 2008	243,475,000	2,435

21. Material related party transactions

(a) During the period, the Group had the following material related party transactions: 

	Unaudited six months ended 30 June 2008	Unaudited six months ended 30 June 2007	Audited year  ended 31 December 2007
	US$'000	US$'000	US$'000
Corporate finance and other advisory fees from investee companies	-	-	1,905
Management services fee received from a subsidiary of an investee company	90	90	180
Management services fee paid to a fellow subsidiary	(26)	(89)	(156)
Payment to an investee company in respect of exercise of warrants	-	(17)	-
Loan to an investee company	1,219	-	-
Fee paid to a fellow subsidiary	(377)	-	-
Proceeds received from a fellow subsidiary in respect of disposal of financial assets at fair value through profit or loss	4,321	-	4,013
Consideration paid in respect of acquisition of subsidiaries from a fellow subsidiary	(60)	-	-

(b) At the balance sheet date, the Group had the following amounts due from related parties. The amounts due from related parties are interest free, unsecured and have no fixed repayment terms.

	Unaudited six months ended 30 June 2008	Unaudited six months ended 30 June 2007	Audited year  ended 31 December 2007
	US$'000	US$'000	US$'000
Amounts due from investee companies	1,020	50	112
Amount due from a subsidiary of an investee company	-	-	33
Amounts due from fellow subsidiaries	16	39	9
Amount due from parent company	40	-	15
Total	1,076	89	169

	Unaudited six months ended 30 June 2008	Unaudited six months ended 30 June 2007	Audited year  ended 31 December 2007
	US$'000	US$'000	US$'000
Amount due to investee companies	882	-	-
Amounts due to a fellow subsidiary	377	79	-
Amount due from parent company	-	21	-
Total	1,259	100	-

22. Contingencies 

The Group had no material contingent liabilities at 30 June 2008.

ENDIR VVLBBVVBEBBQ