TIDMMPS
RNS Number : 7460M
Minorplanet Systems PLC
28 May 2010
INTERIM RESULTS 2010
Minorplanet Systems plc ("Minorplanet", the "Company" or the "Group"), a
developer and provider of Vehicle Management Information (VMI(TM)), announces
its interim results for the six months to 28 February 2010.
Key points
Period under review:
+---+----------------------------------------------------------+
| · | Turnover (continuing operations) of GBP3.5m (2009: |
| | GBP5.5m) |
| | |
+---+----------------------------------------------------------+
| · | Loss from continuing operations of GBP1.9m (2009: loss |
| | of GBP1.7m) |
| | |
+---+----------------------------------------------------------+
| · | Loss per share of GBP0.43 (2009: loss per share of |
| | GBP1.54) |
| | |
+---+----------------------------------------------------------+
| · | The economic recession has had a significant adverse |
| | effect on our SME customer base and severely restricted |
| | the availability of lease finance |
| | |
+---+----------------------------------------------------------+
| · | Although aggressive cost reduction programmes have |
| | substantially reduced the overhead base, sales have |
| | continued to fall, more than offsetting the associated |
| | savings |
+---+----------------------------------------------------------+
| | |
+---+----------------------------------------------------------+
| | |
+---+----------------------------------------------------------+
The future:
+---+----------------------------------------------------------+
| · | Recent acquisition, out of administration, of the |
| | business and certain assets of Minorplanet Limited by a |
| | newly formed subsidiary, MPS 2010 Limited ("MPS 2010") - |
| | funded primarily by DigiCore International Holdings BV |
| | (DigiCore) - provides improved financial stability for |
| | the UK trading operations |
| | |
+---+----------------------------------------------------------+
| · | Establish firm resolutions to ongoing funding |
| | uncertainties |
+---+----------------------------------------------------------+
| | |
+---+----------------------------------------------------------+
| · | Potential to create a significantly larger telematics |
| | platform across Europe with DigiCore's involvement |
+---+----------------------------------------------------------+
For further information, please contact:
+------------------------+--------------------------------------+
| Minorplanet Systems | Tel: 0113 346 7777 |
| plc | |
+------------------------+--------------------------------------+
| Terry Donovan, Chief | terry.donovan@minorplanet.com |
| Executive | |
+------------------------+--------------------------------------+
| Richard Hopkin, | richard.hopkin@minorplanet.com |
| Finance Director | |
+------------------------+--------------------------------------+
| | www.minorplanet.com |
+------------------------+--------------------------------------+
| | |
+------------------------+--------------------------------------+
| Shore Capital & | Tel: 020 7408 4090 |
| Corporate Ltd | |
+------------------------+--------------------------------------+
| Anita Ghanekar | |
+------------------------+--------------------------------------+
| Edward Mansfield | |
+------------------------+--------------------------------------+
| | |
+------------------------+--------------------------------------+
| Rawlings Financial PR | Tel: 01653 618 016 |
| Limited | |
+------------------------+--------------------------------------+
| Catriona Valentine | catriona@rawlingsfinancial.co.uk |
+------------------------+--------------------------------------+
| | www.rawlingsfinancial.co.uk |
+------------------------+--------------------------------------+
CHAIRMAN'S STATEMENT
Although the six months ended 28 February 2010 have continued to be very
difficult for the Group, the recent acquisition, out of administration, of the
business and certain assets of Minorplanet Limited by a newly formed subsidiary,
MPS 2010 Limited ("MPS 2010") - funded primarily by DigiCore International
Holdings BV ("DigiCore") - provides improved financial stability for the UK
trading operations. DigiCore's involvement provides both companies with the
potential to create a significantly larger telematics platform across Europe.
Despite aggressive cost reduction programmes effected over the last eighteen
months, which have substantially reduced the overhead base, sales have continued
to fall, more than offsetting the associated savings. As previously reported,
the economic recession has had a significant adverse effect on our SME customer
base and severely restricted the availability of lease finance. The ongoing
uncertainty surrounding the Group's financial position and the associated
negative perception has adversely impacted our ability to win business in the
larger corporate sector. Our pipeline of such opportunities has significantly
increased, reflecting our enhanced product range and service capability,
although we have been unable to convert a number of these due to adverse
publicity surrounding "going concern" issues and HMRC's winding up petition
against the Group's UK subsidiary Minorplanet Limited.
Results
The Group incurred a loss for the period of GBP2.8m (2009 - loss of GBP2.5m),
including a loss from discontinued operations (Australasia), including
impairment writedowns, of GBP0.9m (2009 - loss of GBP0.8m).
Turnover from continuing operations was down GBP2.0m (36%) to GBP3.5m (2009
- GBP5.5m) due primarily to a decline in the UK and Ireland for the reasons set
out above. However, gross margins improved by 2% to 69% in the period, while
total operating expenses reduced by GBP1.1m (19%), as the Group's average total
headcount reduced from 311 to 238. Net interest receivable was GBP0.5m in the
six months to February 2010 (2009 - GBP0.4m) and the taxation charge was GBP0.1m
(2009 - GBP0.0m), resulting in a loss after tax from continuing operations of
GBP1.9m (2009 - GBP1.7m). The Group incurred a loss per share of GBP0.43 (2009
- GBP1.54), with no charges for minority interests arising in the period.
Cashflow and Balance Sheet
The Group's net bank overdraft fell from GBP0.5m at 1 September 2009 to GBP0.2m
at the end of the period, due primarily to the funds raised from the refinancing
in September 2009 as summarised below. However, total borrowings increased from
GBP1.2m to GBP2.1m and net liabilities rose from GBP2.5m to GBP3.9m details of
which are provided below.
Refinancing and Funding
The Group raised additional working capital of GBP1.8m in September 2009,
through a Placing and Open Offer to existing shareholders totalling GBP1.4m, net
of costs, and GBP0.4m of new block discount loan facilities. A share capital
consolidation of 1 for 20 was also effected as part of the Refinancing. The
Group's existing bank overdraft facility of GBP0.75m was converted into a five
year Enterprise Finance Guarantee Loan.
Subsequent to the refinancing, in February 2010, the Group secured a GBP300,000
loan from our Chief Executive, Terry Donovan, to assist the working capital
requirements of the Group.
The Enterprise Finance Guarantee Loan will be repaid in full out of the sale
proceeds of the business and assets of Minorplanet Limited (in administration).
The loan from Terry Donovan has been assumed by the new subsidiary, MPS 2010
Limited, as part of the same transaction.
The Directors' Statement on going concern is set out in Note 2. The Statement
refers to certain events and circumstances which give rise to funding
uncertainties. However, the Directors believe that Minorplanet has adequate
resources to support the going concern basis.
Minorplanet Asia Pacific Pty Limited ("MAP")
Minorplanet is in advanced negotiations for the sale of its Australasian
subsidiary, MAP, but it is expected that the proceeds will be much less than
previously anticipated. The disposal would allow management to concentrate
fully on Minorplanet's European operations. Mr Philip Bennett stepped down from
the Board earlier this month but remains as Chairman of MAP.
Litigation
On 1 September 2009, we announced the settlement of the longstanding Spanish
litigation with Asbury Park S.A. ("Asbury"). Minorplanet agreed to pay Asbury
the sum of EUR170,000, secured by a debenture, in instalments over the period to
March 2011 (of which EUR70,000 was paid in September 2009). The Company also
granted Asbury a transferable warrant to subscribe for up to 450,000 shares at
an exercise price of 30p per share, exercisable by not later than 14 September
2012.
I am pleased to report that another claim for GBP8m, also relating to the former
Spanish subsidiary, was finally dismissed by the courts during the period.
In January 2010, we were formally notified of a claim which has previously been
threatened against the Company by Popular de Renting S.A. totalling EUR2.1m. As
previously reported, the Board intends to vigorously defend the claim, more
details of which are set out in Note 7.
In May 2010, we were formally notified of legal action being taken against the
Company (including the possible execution of a winding up petition in respect of
a debt of GBP0.3m) by creditors of Minorplanet Limited (in administration),
purportedly due to obligations of the Company in relation to sums outstanding.
The Board believes that these claims will either be proven to be debts of
Minorplanet Limited (in administration) or can be settled from available cash
resources.
UK Business Restructuring
On 14 May 2010 the Group announced that the Company had signed an agreement with
MPS 2010 to acquire out of administration the business and certain assets of the
Group's UK subsidiary, Minorplanet Limited, together with the Group's
Intellectual Property Rights, for a cash consideration of GBP2.7m and the
assumption of the existing loan from Terry Donovan of GBP0.3m made to
Minorplanet Limited in February 2010. MPS 2010 was funded by a GBP3.0m loan
from DigiCore (the "Loan"), including GBP0.3m for initial working capital. MPS
2010 is owned 75% by the Company and 25% by DigiCore. The Loan is guaranteed by
the Company, secured on the shares of MPS 2010, bears interest at 5% p.a. and is
due for repayment on 14 November 2010. Prior to this repayment date, the
Company and MPS 2010 can jointly elect to convert the outstanding loan balance
into new ordinary shares in the Company, at a conversion price of 12p, subject
to shareholder and regulatory approvals. However, in certain limited
circumstances, related primarily to the solvency of the Company and MPS 2010,
DigiCore may have the right to decide not to accept the repayment of the Loan in
the form of new Ordinary Shares. Terry Donovan, Carolanne Hurley and Miles
Woodhouse (the Finance Director of DigiCore's UK subsidiary) have been appointed
to the board of MPS 2010.
Prospects
After an extremely difficult last eighteen months the involvement by DigiCore
gives Minorplanet greater financial stability so we can better focus on the
business. Some ongoing funding uncertainties remain. However, in DigiCore we
have a strong partner, already well established in the larger corporate sector,
and their involvement leaves us better positioned to take advantage of the
market opportunities.
Lars McBride
Chairman
28 May 2010
UNAUDITED CONSOLIDATED INCOME STATEMENT
For the 6 months ended 28 February 2010
+-----------------------------+------------+-----------+-----------+
| | 6 months | 6 months | Year |
| | ended | ended | ended |
+-----------------------------+------------+-----------+-----------+
| | 28 | 28 | 31 |
| | February | February | August |
| | 2010 | 2009 | 2009 |
+-----------------------------+------------+-----------+-----------+
| | GBP'm | GBP'm | GBP'm |
+-----------------------------+------------+-----------+-----------+
| Continuing operations | | | |
+-----------------------------+------------+-----------+-----------+
| Revenue | 3.5 | 5.5 | 9.7 |
+-----------------------------+------------+-----------+-----------+
| Cost of sales | (1.1) | (1.8) | (2.7) |
+-----------------------------+------------+-----------+-----------+
| Gross profit | 2.4 | 3.7 | 7.0 |
+-----------------------------+------------+-----------+-----------+
| | | | |
+-----------------------------+------------+-----------+-----------+
| Operating expenses | (4.7) | (5.8) | (11.7) |
+-----------------------------+------------+-----------+-----------+
| Interest on internal | 0.5 | 0.4 | 1.0 |
| finance leases | | | |
+-----------------------------+------------+-----------+-----------+
| Net external interest | (0.0) | (0.0) | (0.1) |
+-----------------------------+------------+-----------+-----------+
| | | | |
+-----------------------------+------------+-----------+-----------+
| Loss before tax | (1.8) | (1.7) | (3.8) |
+-----------------------------+------------+-----------+-----------+
| | | | |
+-----------------------------+------------+-----------+-----------+
| | | | |
| Loss before tax and | (1.7) | (1.5) | (3.2) |
| exceptional items | | | |
+-----------------------------+------------+-----------+-----------+
| Exceptional items, net | (0.1) | (0.2) | (0.6) |
+-----------------------------+------------+-----------+-----------+
| | | | |
+-----------------------------+------------+-----------+-----------+
| Loss before tax | (1.8) | (1.7) | (3.8) |
+-----------------------------+------------+-----------+-----------+
| | | | |
+-----------------------------+------------+-----------+-----------+
| | | | |
+-----------------------------+------------+-----------+-----------+
| Tax | (0.1) | (0.0) | (0.2) |
+-----------------------------+------------+-----------+-----------+
| Loss for the period from | | | |
| continuing operations | (1.9) | (1.7) | (4.0) |
+-----------------------------+------------+-----------+-----------+
| | | | |
+-----------------------------+------------+-----------+-----------+
| Discontinued operations | | | |
+-----------------------------+------------+-----------+-----------+
| Loss for the period from | | | |
| discontinued operations | (0.9) | (0.8) | (3.2) |
+-----------------------------+------------+-----------+-----------+
| | | | |
+-----------------------------+------------+-----------+-----------+
| Loss for the period | (2.8) | (2.5) | (7.2) |
+-----------------------------+------------+-----------+-----------+
| | | | |
+-----------------------------+------------+-----------+-----------+
| Attributable to: | | | |
+-----------------------------+------------+-----------+-----------+
| Equity holders of the | (2.8) | (2.5) | (7.1) |
| parent | | | |
+-----------------------------+------------+-----------+-----------+
| Minority interest | 0.0 | 0.0 | (0.1) |
+-----------------------------+------------+-----------+-----------+
| | (2.8) | (2.5) | (7.2) |
+-----------------------------+------------+-----------+-----------+
| | | | |
+-----------------------------+------------+-----------+-----------+
| Loss per share | | | |
| From continuing operations | | | |
+-----------------------------+------------+-----------+-----------+
| - basic and diluted | (GBP0.29) | (GBP1.05) | (GBP2.42) |
+-----------------------------+------------+-----------+-----------+
| From discontinued | | | |
| operations | | | |
+-----------------------------+------------+-----------+-----------+
| - basic and diluted | (GBP0.14) | (GBP0.49) | (GBP1.98) |
+-----------------------------+------------+-----------+-----------+
| From continuing and | | | |
| discontinued operations | | | |
+-----------------------------+------------+-----------+-----------+
| - basic and diluted | (GBP0.43) | (GBP1.54) | (GBP4.40) |
+-----------------------------+------------+-----------+-----------+
UNAUDITED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the 6 months ended 28 February 2010
+----------------------------+------------+-----------+----------+
| | 6 months | 6 months | Year |
| | ended | ended | ended |
+----------------------------+------------+-----------+----------+
| | 28 | 28 | 31 |
| | February | February | August |
+----------------------------+------------+-----------+----------+
| | 2010 | 2009 | 2009 |
+----------------------------+------------+-----------+----------+
| | GBP'm | GBP'm | GBP'm |
+----------------------------+------------+-----------+----------+
| | | | |
+----------------------------+------------+-----------+----------+
| | | | |
+----------------------------+------------+-----------+----------+
| Exchange differences on | | | |
| translation of foreign | 0.0 | (0.5) | 0.1 |
| operations | | | |
+----------------------------+------------+-----------+----------+
| Other comprehensive | | | |
| (expense)/income for the | 0.0 | (0.5) | 0.1 |
| period | | | |
+----------------------------+------------+-----------+----------+
| Loss for the period | (2.8) | (2.5) | (7.2) |
+----------------------------+------------+-----------+----------+
| Total recognised income | | | |
| and expense for the period | (2.8) | (3.0) | (7.1) |
+----------------------------+------------+-----------+----------+
| | | | |
+----------------------------+------------+-----------+----------+
| Attributable to: | | | |
+----------------------------+------------+-----------+----------+
| Equity holders of the | (2.8) | (3.0) | (7.0) |
| parent | | | |
+----------------------------+------------+-----------+----------+
| Minority interests | (0.0) | 0.0 | (0.1) |
+----------------------------+------------+-----------+----------+
| | (2.8) | (3.0) | (7.1) |
+----------------------------+------------+-----------+----------+
CONDENSED UNAUDITED CONSOLIDATED BALANCE SHEET
As at 28 February 2010
+-----------------------------+------------+-----------+----------+
| | 28 | 28 | 31 |
| | February | February | August |
| | 2010 | 2009 | 2009 |
+-----------------------------+------------+-----------+----------+
| | GBP'm | GBP'm | GBP'm |
+-----------------------------+------------+-----------+----------+
| | | | |
+-----------------------------+------------+-----------+----------+
| Non-current assets | | | |
+-----------------------------+------------+-----------+----------+
| Goodwill | 0.3 | 2.4 | 0.3 |
+-----------------------------+------------+-----------+----------+
| Other intangible assets | 1.0 | 1.6 | 1.1 |
+-----------------------------+------------+-----------+----------+
| Property, plant and | 0.2 | 0.4 | 0.2 |
| equipment | | | |
+-----------------------------+------------+-----------+----------+
| Finance lease receivables | 1.8 | 2.6 | 1.9 |
+-----------------------------+------------+-----------+----------+
| Deferred tax assets | - | 0.3 | 0.1 |
+-----------------------------+------------+-----------+----------+
| | 3.3 | 7.3 | 3.6 |
+-----------------------------+------------+-----------+----------+
| | | | |
+-----------------------------+------------+-----------+----------+
| Current assets | | | |
+-----------------------------+------------+-----------+----------+
| Inventories | 0.2 | 1.0 | 0.2 |
+-----------------------------+------------+-----------+----------+
| Finance lease receivables | 0.5 | 0.9 | 0.6 |
+-----------------------------+------------+-----------+----------+
| Trade and other receivables | 1.4 | 4.5 | 1.6 |
+-----------------------------+------------+-----------+----------+
| Cash and cash equivalents | 0.0 | 0.2 | 0.0 |
+-----------------------------+------------+-----------+----------+
| Assets held for resale | 5.1 | - | 5.0 |
+-----------------------------+------------+-----------+----------+
| | 7.2 | 6.6 | 7.4 |
+-----------------------------+------------+-----------+----------+
| | | | |
+-----------------------------+------------+-----------+----------+
| Total assets | 10.5 | 13.9 | 11.0 |
+-----------------------------+------------+-----------+----------+
| | | | |
+-----------------------------+------------+-----------+----------+
| Current liabilities | | | |
+-----------------------------+------------+-----------+----------+
| Trade and other payables | (6.7) | (9.4) | (7.4) |
+-----------------------------+------------+-----------+----------+
| Current tax liabilities | - | (0.0) | - |
+-----------------------------+------------+-----------+----------+
| Obligations under finance | (0.1) | (0.1) | (0.1) |
| leases | | | |
+-----------------------------+------------+-----------+----------+
| Bank overdraft | (0.2) | (0.5) | (0.5) |
+-----------------------------+------------+-----------+----------+
| Borrowings | (0.8) | (0.7) | (0.3) |
+-----------------------------+------------+-----------+----------+
| Provisions | (0.8) | (0.6) | (1.1) |
+-----------------------------+------------+-----------+----------+
| Liabilities directly | | | |
| associated with assets | (4.8) | - | (3.8) |
| classified as held for sale | | | |
+-----------------------------+------------+-----------+----------+
| | (13.4) | (11.3) | (13.2) |
+-----------------------------+------------+-----------+----------+
| | | | |
+-----------------------------+------------+-----------+----------+
| Net current liabilities | (6.2) | (4.7) | (5.8) |
+-----------------------------+------------+-----------+----------+
| | | | |
+-----------------------------+------------+-----------+----------+
| Non-current liabilities | | | |
+-----------------------------+------------+-----------+----------+
| Borrowings | (1.0) | (0.9) | (0.3) |
+-----------------------------+------------+-----------+----------+
| | | | |
+-----------------------------+------------+-----------+----------+
| Total liabilities | (14.4) | (12.2) | (13.5) |
+-----------------------------+------------+-----------+----------+
| | | | |
+-----------------------------+------------+-----------+----------+
| Net (liabilities)/assets | (3.9) | 1.7 | (2.5) |
+-----------------------------+------------+-----------+----------+
| | | | |
+-----------------------------+------------+-----------+----------+
| Equity | | | |
+-----------------------------+------------+-----------+----------+
| Share capital | 9.6 | 8.6 | 8.6 |
+-----------------------------+------------+-----------+----------+
| Share premium account | 0.4 | - | - |
+-----------------------------+------------+-----------+----------+
| Equity reserves | 18.2 | 18.2 | 18.2 |
+-----------------------------+------------+-----------+----------+
| Retained earnings | (32.3) | (25.4) | (29.5) |
+-----------------------------+------------+-----------+----------+
| Equity attributable to | | | |
| equity holders of the | (4.1) | 1.4 | (2.7) |
| parent | | | |
+-----------------------------+------------+-----------+----------+
| Minority interest | 0.2 | 0.3 | 0.2 |
+-----------------------------+------------+-----------+----------+
| Total equity | (3.9) | 1.7 | (2.5) |
+-----------------------------+------------+-----------+----------+
UNAUDITED CONSOLIDATED CASHFLOW STATEMENT
For the 6 months ended 28 February 2010
+-----------------------------+------------+-----------+----------+
| | 6 months | 6 months | Year |
| | ended | ended | ended |
+-----------------------------+------------+-----------+----------+
| | 28 | 28 | 31 |
| | February | February | August |
| | 2010 | 2009 | 2009 |
+-----------------------------+------------+-----------+----------+
| | GBP'm | GBP'm | GBP'm |
+-----------------------------+------------+-----------+----------+
| | | | |
+-----------------------------+------------+-----------+----------+
| Net cash used in operating | (3.1) | (0.9) | (2.9) |
| activities | | | |
+-----------------------------+------------+-----------+----------+
| | | | |
+-----------------------------+------------+-----------+----------+
| Investing activities | | | |
+-----------------------------+------------+-----------+----------+
| Interest received | 0.7 | 0.5 | 1.3 |
+-----------------------------+------------+-----------+----------+
| Proceeds on disposal of | | | |
| property, plant and | 0.0 | 0.0 | 0.1 |
| equipment | | | |
+-----------------------------+------------+-----------+----------+
| Purchases of property, | (0.0) | (0.0) | (0.2) |
| plant and equipment | | | |
+-----------------------------+------------+-----------+----------+
| Purchases of patents and | (0.0) | (0.0) | (0.0) |
| trademarks | | | |
+-----------------------------+------------+-----------+----------+
| Acquisition of subsidiary | - | - | (0.0) |
+-----------------------------+------------+-----------+----------+
| | | | |
+-----------------------------+------------+-----------+----------+
| Net cash from investing | 0.7 | 0.5 | 1.2 |
| activities | | | |
+-----------------------------+------------+-----------+----------+
| | | | |
+-----------------------------+------------+-----------+----------+
| Financing activities | | | |
+-----------------------------+------------+-----------+----------+
| Issue/(repayments) of | 1.3 | (0.6) | (0.1) |
| borrowings | | | |
+-----------------------------+------------+-----------+----------+
| Repayment of obligations | | | |
| under finance leases | (0.0) | (0.0) | (0.0) |
+-----------------------------+------------+-----------+----------+
| Proceeds on issue of shares | 1.4 | - | - |
+-----------------------------+------------+-----------+----------+
| | | | |
+-----------------------------+------------+-----------+----------+
| Net cash received(used in) | 2.7 | (0.6) | (0.1) |
| financing activities | | | |
+-----------------------------+------------+-----------+----------+
| | | | |
+-----------------------------+------------+-----------+----------+
| Net increase/(decrease) in | | | |
| cash and cash equivalents | 0.3 | (1.0) | (1.8) |
+-----------------------------+------------+-----------+----------+
| | | | |
+-----------------------------+------------+-----------+----------+
| Cash and cash equivalents | | | |
| at beginning of period | (0.5) | 1.2 | 1.2 |
+-----------------------------+------------+-----------+----------+
| | | | |
+-----------------------------+------------+-----------+----------+
| Effect of foreign exchange | (0.0) | (0.5) | 0.1 |
| rate changes | | | |
+-----------------------------+------------+-----------+----------+
| | | | |
+-----------------------------+------------+-----------+----------+
| Cash and cash equivalents | | | |
| at end of period, net of | (0.2) | (0.3) | (0.5) |
| bank overdraft | | | |
+-----------------------------+------------+-----------+----------+
NOTES TO THE CONDENSED SET OF FINANCIAL STATEMENTS
For the 6 months ended 28 February 2010
1. General information
The financial information for the six month periods ended 28 February 2010 and
28 February 2009 has been neither audited nor reviewed. The financial
information for the year ended 31 August 2009 is based upon audited financial
statements for that period and does not constitute statutory accounts as defined
in section 434 of the Companies Act 2006. A copy of the statutory accounts for
that year has been delivered to the Registrar of Companies. The auditors'
report on those accounts was not qualified and did not contain statements under
section 498(2) or (3) of the Companies Act 2006. However it did contain an
emphasis of matter with regard to going concern.
2. Accounting policies
This set of condensed financial statements has been prepared using accounting
policies consistent with International Financial Reporting Standards (IFRSs).
The same accounting policies, presentation and methods of computation are
followed in the condensed set of financial statements as applied in the Group's
latest annual audited financial statements. While the financial figures
included in this half-yearly report have been computed in accordance with IFRSs
applicable in interim periods, this half-yearly report does not contain
sufficient information to constitute an interim financial report as that term is
defined in IAS 34.
Going Concern
As described in the Chairman's Statement the current economic environment
remains challenging and the Group has reported a loss of GBP2.8m for the period.
In assessing the appropriateness of the going concern basis, the Directors have
prepared forecasts for a period of 12 months from the date of these financial
statements and have considered downside sensitivites. These forecasts take into
account the current economic environment as well as the Directors' view with
regard to the Group's future prospects. The forecasts show that the Group
should be able to meet its obligations as they fall due. However, a number of
material uncertainties exist and these have been summarised below. Failure to
achieve the assumed outturn in respect of any of these uncertainties would
result in a shortfall of funds.
· The forecasts assume an improvement in sales performance. The Directors
acknowledge that such an improvement is uncertain given the current adverse
economic conditions. However, based on the sales pipeline, the renewals
capability and service proposition, the Directors consider that the forecast
sales levels are realistic.
· The Group has breached the terms of a loan obligation of approximately
GBP500,000. Under the terms of the loan agreement the balance is payable on
demand as a result of this breach and currently no formal waiver or revised
repayment plan is agreed. No formal agreement exists with regard to repayment
and hence an uncertainty exists over the required repayment timings. However
the Directors note that during previous informal discussions the counterparty
has indicated that a repayment schedule over a period of approximately two years
would be acceptable and that immediate repayment will not be requested.
· The Group has been notified of a material claim with regard to guarantees
purportedly given in relation to obligations of a former subsidiary (see note
7). Should any settlement be required, its quantum and timing are uncertain.
However, the claim will be vigorously defended and the Directors are of a view
that, based on legal advice, there is unlikely to be a judgement or commercial
settlement in the next twelve months. Any settlement would be agreed on a basis
of terms that the Group was able to meet.
· As noted in the Chairman's Statement, as part of the recent restructuring
of the UK business, DigiCore International Holdings BV has made a GBP3m loan to
MPS 2010 Limited. This loan, which is guaranteed by the Company, is due to be
repaid by 14 November 2010. It is anticipated that this loan will be either
repaid, refinanced or converted into new ordinary shares in the Company (on the
terms set out in the Chairman's Statement) prior to that date. At this stage
there remains an uncertainty over which, if any, of those options will be
achieved.
· The Company has been notified by certain creditors of Minorplanet Limited
(in administration) of legal action being taken against it (including the
possible execution of a winding up petition in respect of a debt of GBP0.3m)
purportedly due to obligations of the parent company in relation to sums
outstanding. Although there is an uncertainty as to the outcome of such claims,
the Board is confident that these will either be proven to be debts of
Minorplanet Limited (in administration) or can be settled from available cash
resources.
The Directors have concluded that a combination of these circumstances
represents a material uncertainty related to events or circumstances which may
cast significant doubt on the Group and Company's ability to continue as a going
concern, and therefore, that it may be unable to realise its assets and
discharge its liabilities in the normal course of business. Nevertheless, after
making enquiries and considering the uncertainties described above, the
Directors are of the view that these matters can be managed to a satisfactory
resolution and consequently the impact of the uncertainties can be mitigated.
In light of the above, the Directors have a reasonable expectation that
Minorplanet will have adequate resources to continue in operational existence
for the foreseeable future and for these reasons they continue to adopt the
going concern basis in preparing these results.
3. Exceptional items, net
Exceptional items, net, comprise:
+----------------------------------+-------------+-------------+
| | 6 months | 6 months |
| | ended | ended |
+----------------------------------+-------------+-------------+
| | 28 February | 28 February |
| | 2010 | 2009 |
+----------------------------------+-------------+-------------+
| | GBP'm | GBP'm |
+----------------------------------+-------------+-------------+
| | | |
+----------------------------------+-------------+-------------+
| Restructuring and other charges | (0.1) | (0.2) |
| | | |
+----------------------------------+-------------+-------------+
| | (0.1) | (0.2) |
+----------------------------------+-------------+-------------+
4. Tax
Corporation tax for the six month period is charged at the prevailing rates,
adjusted for the utilisation of brought forward losses.
5. Loss per share
The calculation of the basic and diluted loss per share is based on the
following data:
+----------------------------------+-------------+-------------+
| | 6 months | 6 months |
| | ended | ended |
+----------------------------------+-------------+-------------+
| | 28 February | 28 February |
| | 2010 | 2009 |
+----------------------------------+-------------+-------------+
| | GBP'm | GBP'm |
+----------------------------------+-------------+-------------+
| Loss | | |
+----------------------------------+-------------+-------------+
| Loss for the purposes of basic | | |
| and diluted earnings per share | | |
| being the net loss attributable | (1.9) | (1.7) |
| to equity holders of the parent | | |
| from continuing operations | | |
+----------------------------------+-------------+-------------+
| Loss for the purposes of basic | | |
| and diluted earnings per share | | |
| being the net loss attributable | (0.9) | (0.8) |
| to equity holders of the parent | | |
| from discontinued operations | | |
+----------------------------------+-------------+-------------+
| | | |
+----------------------------------+-------------+-------------+
| | Number | Number |
+----------------------------------+-------------+-------------+
| Number of shares | | |
+----------------------------------+-------------+-------------+
| Weighted average number of | | |
| ordinary shares for the purposes | 6,587,950 | 1,621,493 |
| of basic and diluted earnings | | |
| per share | | |
+----------------------------------+-------------+-------------+
The loss per share figures for February and August 2009 have been restated to
reflect the 1 for 20 share capital consolidation which was effected in September
2009.
6. Notes to the cash flow statement
+-----------------------------------+------------+--------------+
| | 6 months | 6 months |
| | ended | ended |
+-----------------------------------+------------+--------------+
| | 28 | 28 February |
| | February | 2009 |
| | 2010 | |
+-----------------------------------+------------+--------------+
| | GBP'm | GBP'm |
+-----------------------------------+------------+--------------+
| | | |
+-----------------------------------+------------+--------------+
| Loss for the period | (2.8) | (2.5) |
+-----------------------------------+------------+--------------+
| Adjustments for: | | |
+-----------------------------------+------------+--------------+
| Interest on internal finance | (0.7) | (0.5) |
| leases | | |
+-----------------------------------+------------+--------------+
| Interest paid | 0.1 | 0.1 |
+-----------------------------------+------------+--------------+
| Corporation tax expense | 0.1 | 0.0 |
+-----------------------------------+------------+--------------+
| Loss on disposal of discontinued | 0.9 | - |
| operations | | |
+-----------------------------------+------------+--------------+
| Depreciation of property, plant | 0.1 | 0.1 |
| and equipment | | |
+-----------------------------------+------------+--------------+
| Capitalisation of intangible | | |
| assets net of related | (0.2) | (0.2) |
| amortisation | | |
+-----------------------------------+------------+--------------+
| Share-based payment expense | 0.0 | 0.0 |
+-----------------------------------+------------+--------------+
| Movement in asset held for resale | (0.2) | - |
+-----------------------------------+------------+--------------+
| Loss/(profit) on disposal of | | |
| property, plant and equipment | 0.0 | 0.0 |
+-----------------------------------+------------+--------------+
| Increase in provisions | 0.2 | 0.1 |
+-----------------------------------+------------+--------------+
| Operating cash flows before | | |
| movements in working capital | (2.5) | (2.9) |
+-----------------------------------+------------+--------------+
| | | |
+-----------------------------------+------------+--------------+
| (Increase)/decrease in | (0.1) | 0.1 |
| inventories | | |
+-----------------------------------+------------+--------------+
| (Increase)/decrease in | (0.2) | 0.2 |
| receivables | | |
+-----------------------------------+------------+--------------+
| (Decrease)/increase in payables | (0.2) | 1.8 |
+-----------------------------------+------------+--------------+
| Cash used by operations | (3.0) | (0.8) |
+-----------------------------------+------------+--------------+
| | | |
+-----------------------------------+------------+--------------+
| Interest paid | (0.1) | (0.1) |
+-----------------------------------+------------+--------------+
| | | |
+-----------------------------------+------------+--------------+
| Net cash used in operating | (3.1) | (0.9) |
| activities | | |
+-----------------------------------+------------+--------------+
Cash and cash equivalents (which are presented as a single class of assets on
the face of the balance sheet) comprise cash at bank.
7. Potential litigation
In 2006 the Company received notification of a potential claim of EUR2.09m from
Popular de Renting SA, a leasing provider to Minorplanet Systems SA. It is
alleged that an agreement was signed in 2002, under which it is maintained that
Minorplanet Systems plc guaranteed the fulfilment of Minorplanet Systems SA's
obligations to Popular de Renting. Whilst the current Board had no knowledge of
this agreement or of any actual or contingent liability arising from it, it has
investigated the substance of the claim, and has received legal opinion
regarding the prospects of defending a claim. Popular de Renting SA have
commenced formal legal proceedings. Investigations into the matter are on going
and the claim brought against the Company will be vigorously defended. In
addition, the Company will examine all possible recourse it may have against any
third parties.
As previously reported, in September 2009 the Company reached a settlement with
Asbury Park SA, regarding the claim, comprising cash payments of EUR170,000,
payable in instalments prior to 14 March 2011 (of which EUR70,000 was paid in the
period ended 28 February 2010), and the granting of warrants over 450,000 of the
Company's 20p Ordinary shares, exercisable at 30p at any time prior to 14
September 2012.
The historic claim by Minorplanet Systems SA relating to an alleged failure to
supply products and alleged defective products actually supplied by Minorplanet
Limited was struck out by the Courts during the period ended 28 February 2010.
In May 2010, we were formally notified of legal action being taken against the
Company (including the possible execution of a winding up petition in respect of
a debt of GBP0.3m) by creditors of Minorplanet Limited (in administration),
purportedly due to obligations of the Company in relation to sums outstanding.
The Board believes that these claims will either be proven to be debts of
Minorplanet Limited (in administration) or can be settled from available cash
resources.
There have been no significant developments in the period under review relating
to any of the other possible claims involving the Group's former overseas
subsidiaries.
8. Availability of Interim Report
Copies of these interim results will be available shortly from Minorplanet
Systems plc, Greenwich House, 223 North Street, Leeds, LS7 2AA. Alternatively a
downloadable version will be available from the following web address:
www.minorplanet.com.
9. The half year statement was approved by the Board on 28 May 2010.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR MMGZKFRNGGZM
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