Interim Results
04 November 2003 - 9:59PM
UK Regulatory
RNS Number:6431R
Reflec PLC
04 November 2003
Reflec plc
("Reflec" or "the Company")
Interim results for the six months ended 31 August 2003
In the first 6 months of this year, the Company generated sales of #1.47m, which
was about on plan and compared to #1.5m for the first half of last year. These
activities generated a loss after depreciation and amortisation of #0.175m,
which was ahead of budget and represented a 84% reduction in the level of
operating losses in the same period last year. We are forecasting a small profit
in the second half of the year with a full year estimate of losses of #0.13m, a
94% improvement over last years results.
No dividend is payable.
The last 6 months have seen the Group benefit from its new strategy. The three
businesses that make up the Group, Reflecmedia, ReflecEvolution and
ReflecReflectives are held accountable to their own set of financial results.
Headquarter costs have been greatly reduced and are now allocated within each of
the 3 businesses. As part of this programme the positions of Chairman and CEO
have been merged into one with John Gilliatt leaving his post in July of this
year.
ReflecMedia
ReflecMedia is now operating as the third business in the Reflec Group. It has
had a successful first half of the year with sales exceeding those achieved in
the whole of last year. Participation at major exhibitions in Europe, Asia and
North America have resulted in the signing of several new channel partners
including two leading companies in the important North American market. The
business is now operating on a global scale with more than 85% of its revenue
being derived from overseas. To drive sales further new innovative marketing
programmes have been developed including a new DVD designed for use by the
channel partners. Finally, the business received a major endorsement for its
unique technology being awarded the "Award for Innovation in Media" at the
recent National Association of Broadcasters exhibition in Las Vegas, the largest
trade show of its kind worldwide.
We anticipate sales to continue to grow in the second half of the year with the
business generating a small contribution to the Group in its first full year of
operations.
Reflec Evolution
Reflec Evolution continues to perform well in a highly competitive domestic
market. The business generated profits and positive cash flow for the Group.
The strategy remains on building a customer centric organisation focused on
delivering superior value to its clients. The business is capable of further
growth as it continues to improve productivity and better utilise machine
capacity.
Despite some seasonality in sales, we expect a similar level of performance in
the second half of the year.
Reflec Reflectives
Despite the major setbacks in the EN471 tape market, the financial performance
of the business has been greatly improved on the back of major cost cutting.
However, further improvements are required to achieve the Group's minimum
financial targets.
Today, the business is concentrated in North America where it is developing a
platform for growth worldwide. The strategy, focused on its range of illumiNITE(R)
branded products, has been strengthened with the launch of its new brand
licensing programme. Over the past 6 months, 6 new licensees operating in 6
different countries worldwide have been signed.
The global opportunities for this business are significant and are beyond the
current financial capabilities of the Group. As a result, the Company continues
to discuss possibilities with potential partners ranging from a strategic
investment to acquire a minority stake to the outright sale of the business.
Summary
The past 6 months has seen the Group benefit from its new business strategy and
greater financial controls. Operating costs have been brought in line with
current levels of revenue as the Group strides to grow from a new profitable
base. To facilitate the rapid growth of the businesses, and in particular
Reflecmedia, the Company has been actively exploring opportunities for a modest
fundraising and a further announcement will be made soon concerning this matter.
The Board did consider approaching existing shareholders for further funding. It
concluded, however, that the cost of raising funds by this method would be
prohibitive given the amount of money the Board is considering raising. Emphasis
is being given to accelerate the growth of the ReflecMedia business within the
financial constraints of the Group.
Peter Smith
Chairman & CEO
Group profit and loss account
1 March to Year 1 March to
ended
31-Aug 28-Feb 31-Aug
2003 2003 2002
(unaudited) (audited) (unaudited)
#000s #000s #000s
Turnover 1,469 3,205 1,499
---------- ---------- ----------
Operating loss (181) (2,114) (1,145)
Net interest receivable 6 29 25
---------- ---------- ----------
Loss on ordinary activities (175) (2,085) (1,120)
before taxation
Taxation - 62 -
---------- ---------- ----------
Loss for the period (175) (2,023) (1,120)
---------- ---------- ----------
Basic loss per share (0.04p) (0.48p) (0.3p)
---------- ---------- ----------
Diluted loss per share (0.04p) (0.48p) (0.3p)
---------- ---------- ----------
Consolidated statement of total recognised gains and losses
1 March to Year 1 March to
ended
31-Aug 28-Feb 31-Aug
2003 2003 2002
(unaudited) (audited) (unaudited)
#000s #000s #000s
Loss for the half year after (175) (2,023) (1,120)
taxation
Currency translation 36 48 -
differences on foreign ---------- ---------- ----------
currency net investment
Total recognised gains and (139) (1,975) (1,120)
losses for the period ---------- ---------- ----------
Group balance sheet
As at As at As at
31-Aug 28-Feb 31-Aug
2003 2003 2002
(unaudited) (audited) (unaudited)
#000s #000s #000s
Fixed assets
Intangible assets 698 711 1,039
Tangible assets 1,292 1,365 1,413
--------- ------- ---------
1,990 2,076 2,452
--------- ------- ---------
Current assets
Stocks 552 714 1,176
Debtors-amounts falling due 1,124 999 1,006
within one year
Cash at bank and in hand 146 549 1,003
--------- ------- ---------
1,822 2,262 3,185
--------- ------- ---------
Creditors : amounts falling due 474 849 1,121
within one year
Net current assets 1,348 1,413 2,064
--------- ------- ---------
Total assets less current 3,338 3,489 4,516
liabilities
Creditors : amounts falling due 12 24 196
after one year --------- ------- ---------
3,326 3,465 4,320
--------- ------- ---------
Capital and reserves
Called up share capital 425 425 425
Share premium account 12,915 12,915 12,915
Profit and loss account (10,014) (9,875) (9,020)
--------- ------- ---------
Shareholders' funds 3,326 3,465 4,320
--------- ------- ---------
Group cash flow statement
Year ended
1 March to 1 March to
31-Aug 28-Feb 31-Aug
2003 2003 2002
(unaudited) (audited) (unaudited)
#000s #000s #000s
Net outflow from operating (386) (2,063) (1,471)
activities
Returns on investments and 6 29 25
servicing of finance
Taxation - 62 -
Capital expenditure (6) (83) (71)
Acquisitions - - -
--------- ------- ---------
(386) (2,055) (1,517)
Management of liquid 80 2,020 -
resources
Financing (17) 16 (93)
--------- ------- ---------
(Decrease)/increase in cash (323) (19) (1,610)
--------- ------- ---------
Reconciliation of net cash flow
to funds
Year ended
1 March to 1 March to
31-Aug 28-Feb 31-Aug
2003 2003 2002
(unaudited) (audited) (unaudited)
#000s #000s #000s
Cash outflow in the period (323) (19) (1,610)
Cash (inflow)/outflow from 17 (16) 93
decrease in debt and lease
finance
Cash inflow from decrease in (80) (2,020) -
liquid resources --------- ------- ---------
Change in net funds resulting (386) (2,055) (1,517)
from cash flow
Translation differences - (25) -
New finance leases - - (40)
--------- ------- ---------
Change in net funds (386) (2,080) (1,557)
Net funds at start of period 501 2,581 2,581
--------- ------- ---------
Net funds at end of period 115 501 1,024
--------- ------- ---------
Notes to the interim statement
1. The Interim Statement for Reflec plc relates to the consolidated results
for the six months ended 31 August 2003 and the comparative results for the
year ended 28 February 2003 and the six months ended 31 August 2002.
2. The Interim Statement has been prepared on the basis of the accounting
policies set out in the statutory financial statements to 28 February 2003.
The Interim Statement was approved by the Board of Directors on the 4
November 2003. No dividend is payable. The balance sheet at 28 February 2003
and the result for the year ended have been abridged from the audited
accounts to 28 February 2003. A copy of the statutory accounts for that year
has been delivered to the Registrar of Companies. The Auditors report on
those accounts was unqualified and did not contain a statement under Section
237 (2) - (3) of the Companies Act 1985.
3. The calculation of loss per share for the period to 31 August 2003 is based
upon losses of #175,700 and on the weighted average number of ordinry shares
in issue during the period of 424,699,774. (The comparative period to 31
August 2002 is based on a loss of #1,120,200 on the weighted average number
of ordinary shares in issue during the period of 424,699,774).
4. Copies of the Interim Statement will be posted on the Company web site and
are available from the Company Secretary at the Registered Office, Road One,
Winsford Industial Estate,Winsford, Cheshire, CW7 3QQ.
5. Reconciliation of operating profit to net cash outflow from operating
activities:
1 March to 1 March to
31-Aug 28-Feb 31-Aug
2003 2003 2002
(unaudited) (audited) (unaudited)
#000s #000s #000s
Operating profit/(loss) (181) (2,114) (1,145)
Depreciation and amortisation 85 620 232
of fixed assets
Decrease/(Increase) in stocks 162 59 (379)
Increase in debtors (118) (224) (225)
(Decrease)/Increase in (334) (404) 46
creditors --------- ------- ---------
Net cash outflow from operating (386) (2,063) (1,471)
activities --------- ------- ---------
This information is provided by RNS
The company news service from the London Stock Exchange
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