RNS Number:3363Q
Coe Group PLC
30 September 2003
COE GROUP PLC
(formerly known as Timeload plc)
Unaudited Preliminary Results for the six months ended 30th June 2003
The Group has undergone a fundamental transformation during the reporting
period, comprising a capital re-organisation, the return of funds to its
shareholders and finally the acquisition of the whole of the share capital of
COE Limited, a premium provider of technology for managed video networks for
traffic control and security systems applications. Following the acquisition,
the Group changed its name to COE Group plc.
HIGHLIGHTS
* Capital Reduction Scheme approved by the Court.
* The Group completed the return of #2.2 million to shareholders by way
of a tender offer.
* On 28th May 2003 the Group acquired the whole of the share capital of
COE Limited, and changed its name to COE Group plc. The consideration was #1.3
million in shares based on the share price on admission to AIM.
* Results of Group mainly reflect the costs associated with activities
prior to its acquisition of COE Limited.
* The first month's trading of the new group to 30th June 2003 was below
expectation. Delays were experienced in the receipt of orders for major
contracts.
* Accounting reference date changed to 30th June.
CHAIRMAN'S STATEMENT
Introduction
The Group has changed its accounting reference date from 31st December to 30th
June. Consequently, the results for the period ended 30th June 2003 and the
Balance Sheet at that date constitute the accounts for a shortened accounting
period of six months.
The financial results for the period ended 30th June 2003 primarily represents
the winding down of the operations of Timeload plc, following the sale of its
last trading business, Scoot.com, to British Telecom in August 2002. The
acquisition of COE Limited took place on 28th May 2003, and the trading results
of COE Limited for the month of June only are included in these results.
Group turnover, representing the one month's trading of the new Group, was
#364,000 (year to 31st Dec. 2002: #3,464,000). The loss on ordinary activities
before taxation was #115,000 (Year to 31st Dec. 2002: #1,047,000). After
accounting for tax, the profit attributable to shareholders was #11,000 (Year to
31st Dec. 2002: #1,131,000).
Review of Business
Prior to the acquisition of COE Limited, the Group effectively comprised a cash
shell, with no trading activities remaining following the sale of the assets of
Scoot.com in August 2002. A portion of the cash in the Group was returned to
shareholders by way of a tender offer, and on 28th May 2003 the Group acquired
the whole of the share capital of COE Limited. Since, at the time, Timeload had
no trading activities, the acquisition was treated as a reverse takeover.
Following the acquisition, the Group was de-listed from the Official List of the
London Stock Exchange and was admitted to AIM.
Activities of the new Group
The Group now designs, manufactures and markets a range of networked analogue
and digital video solutions for commercial surveillance applications. It has an
established market position which it has developed by supplying to a number of
leading transport infrastructure and city centre surveillance projects
world-wide, and through a global network comprising a direct sales team and
third party Value Added Resellers.
COE Limited was founded in 1989, and its directors believe that a significant
number of CCTV installations in city centres in the UK currently operate using
equipment supplied by COE. In addition, COE has been very active in the
security market as well as its involvement in major traffic management schemes.
Operating performance of COE over the past few months has been disappointing,
due in part to the delay of major infrastructure projects in which the Company
is confident it will participate. As a consequence, a comprehensive review of
all its operations was completed in September 2003. The result of the review
will be a re-alignment of the cost base to ensure that it reflects the revenue
earning capability of the Group.
The number of employees will be reduced significantly from the number employed
at the beginning of this financial year. This will be accompanied by a refocus
of both the sales and engineering resources to ensure maximum impact in the
marketplace.
Board Changes
As a result of the acquisition, the composition of the Board has changed. Dick
Eykel remains as Chairman, and he has been joined by a number of COE directors/
executives, namely Brain Wadsworth as Chief Executive Officer, Mark Marriage as
Chief Technical Officer, together with John Cook and Colin Glass who are
Non-Executive Directors. Following the acquisition Mr. Michael Sandpearl was
appointed as Chief Financial Officer.
Annual Report and Accounts
The Annual Report and Accounts will be available on the company website (http://
www.coe.co.uk/) or at the company premises (Photon House, Percy Street, Leeds,
LS12 1EG) in the next few days and will be sent to shareholders.
Dick Eykel
30th September 2003
CONSOLIDATED PROFIT AND LOSS ACCOUNT (Unaudited)
For the six month period ended 30th June 200l3
Six month period ended 30th June 2003 Year ended 31st December 2002
Before goodwill Goodwill Total Before Goodwill Total
/ amortisation Goodwill Amortisation
Amortisation /
Exceptionals
#'000 #'000 #'000 #'000 #'000 #'000
Gross Turnover:
- continuing operations 364 - 364 - - -
(acquisitions)
- discontinued operations - - - 3,464 - 3,464
GROUP TURNOVER 364 - 364 3,464 - 3,464
Cost of Sales:
- continuing operations (167) - (167) - - -
(acquisitions)
- discontinued operations - - - (280) - (280)
GROSS PROFIT 197 - 197 3,184 3,184
Selling and administrative
expenses:
- continuing operations (333) - (333) (1000) - (1,000)
- acquisitions (178) (37) (215) - - -
(511) (37) (548) (1,000) - (1,000)
- discontinued operations - - - (6,516) - (6,516)
Total selling and administrative (511) (37) (548) (7,516) - (7,516)
expenses
GROUP OPERATING LOSS:
- continuing operations (333) - (333) (1,000) - (1,000)
- acquisitions 19 (37) (18) - - -
(314) (37) (351) (1,000) - (1,000)
- discontinued operations - - - (3,332) - (3,332)
Total Operating Loss (314) (37) (351) (4,332) - (4,332)
Exceptional Items
- profit on disposal of operations - - - - 5,220 5,220
- loss on disposal of fixed assets - - - - (190) (190)
Net Interest receivable 236 - 236 349 - 349
(LOSS)/PROFIT ON ORDINARY (78) (37) (115) (3,983) 5,030 1,047
ACTIVITIES BEFORE TAXATION
Tax on (loss)/profit on ordinary 126 - 126 84 - 84
activities
RETAINED PROFIT ON ORDINARY
ACTIVITIES AFTER TAXATION and FOR
THE PERIOD 48 (37) 11 (3,899) 5,030 1,131
Basic and diluted earnings / 0.34p (0.26p) 0.08p (26.94p) 34.75p 7.81p
(loss) per share
Adjusted basic and diluted 0.34p - 0.34p (26.94p) - (26.94p)
earnings / (loss) per share
CONSOLIDATED BALANCE SHEET (Unaudited)
As at 30th June 2003
Note 30th June 31st December
2003 2002
#'000 #'000
Fixed Assets
Intangible Fixed Assets 2,398 -
Tangible Fixed Assets 1,188 -
3,586 -
Current Assets
Stocks 1,073 -
Debtors: Amounts falling due after one year 407 -
Debtors: Amounts falling due within one year 1,799 289
Total Debtors 2,206 289
Money Market Funds 4 27,884 36,430
Cash at Bank 248 271
31,411 36,990
Creditors - Amounts falling within one year:
Loans 4 26,685 30,931
Other Creditors 3,493 1,057
30,178 31,988
Net Current Assets 1,233 5,002
Total Assets less current liabilities 4,819 5,002
Creditors: Amounts falling due after more than one year (684) -
Net Assets 4,135 5,002
Capital & Reserves
Called up share capital 620 14,472
Share premium account 1,116 320,784
Profit and loss account 2,399 (330,454)
Equity Shareholders' Funds 4,135 4,802
Non-Equity shareholders funds - 200
Total Shareholders' Funds 4,135 5,002
CONSOLIDATED CASH FLOW STATEMENT
for the six month period ended 30th June 2003 (Unaudited)
Note Six month period Year ended 31st
ended 30th June December 2002
2003
#'000 #'000
Net cash outflow from operating activities 5 (39) (6,000)
Returns on investments and servicing of finance:
Interest received 695 2,500
Interest paid (466) (1,900)
Net Cash flow from returns on investments and servicing 229 600
of finance
Taxation Received 7 100
Capital Expenditure and financial investment:
Payments to acquire tangible fixed assets (7) -
Net cash flow from capital Investment and financial (7) -
investment
Acquisitions and Disposals:
Disposal of subsidiaries and businesses (net of - 4,100
expenses)
Purchase of subsidiary undertakings (1,429) -
Net overdraft acquired with subsidiary undertaking (1,591) -
Net Cash (outflow)/inflow from acquisitions and (3,020) 4,100
disposals
Net cash flow before management of liquid resources and
financing
(2,830) (1,200)
Management of liquid resources:
Decrease in money market investments and deposits 8,456 7,400
Financing:
Purchase of own shares (2,170) -
Repayment of loans (4,246) (6,700)
Net Cash flow from financing (6,416) (6,700)
Decrease in cash in the period (700) (500)
NOTES TO THE PRELIMINARY ANNOUNCEMENT
For the six months ended 30th June 2003
1. BASIS OF PREPARATION
This preliminary announcement, which has been prepared on the basis consistent
with the previous period, does not constitute statutory accounts within the
meaning of Section 240 of the Companies Act 1985. This announcement has been
agreed with PricewaterhouseCoopers LLP for release.
The information for the year to December 2002 is an extract from the statutory
accounts to that date which have been delivered to the Registrar of Companies.
These accounts included an audit report which was unqualified and which did not
contain a statement under section 237 (2) or (3) of the Companies Act 1985. The
statutory accounts for the period ended 30th June 2003, upon which the auditors
have still to report, will be delivered to the Registrar of Companies following
the Company's Annual General Meeting.
2. EXCEPTIONAL ITEMS
Six month period ended Year ended 31st
30th June 2003 December
2002
#'000 #'000
Non Operating:
Profit on disposal of Scoot UK - 4,762
Settlement of Loot disposal retention provisions
- 458
Profit on disposal of operations - 5,220
Loss on disposal of fixed assets - (190)
- 5,030
3. NET INTEREST RECEIVABLE
Six month period ended Year ended 31st
30th June 2003 December
2002
#'000 #'000
Interest payable on the Loot loan notes
(456) (1,110)
Other interest payable (9) (90)
(465) (1,200)
Interest received on cash at bank 8 203
Interest received on pledged deposit 693 1,346
Net interest receivable 236 349
4. LOANS/MONEY MARKET FUNDS
The remaining Loot loan notes of #26,685,000 (31st December 2002: #30,931,000)
representing part of the consideration for Loot, are redeemable in full on or
before 31st December 2007. They are secured by an equivalent in value money
market deposit account. #4,296,000 of the loan notes were redeemed in June
2003.
5. NET CASH OUTFLOW FROM OPERATING ACTIVITIES
Six month period ended Year ended 31st
30th June 2003 December
2002
#'000 #'000
Group operating loss (351) (4,300)
Depreciation 13 300
Goodwill amortisation 37 -
Share option scheme release (10) (200)
Increase in stock (129) -
(Increase)/Decrease in debtors (1) 3,800
Increase in provisions 61 -
Increase/(Decrease) in creditors 341 (5,600)
(39) (6,000)
Continuing operations (39) -
Discontinued operations - (6,000)
(39) (6,000)
6. ANNUAL GENERAL MEETING
The Company's Annual General Meeting is due to be held at 11.00 a.m. on 27th
November 2003 at the Hotel Metropole, Leeds. Copies of the full financial
statements for the period ended 30th June 2003 will be available to the public
and at the registered office of the Company at Photon House, Percy Street, Leeds
LS12 1EG.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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