TIDMAMBR
RNS Number : 1055P
Ambrian Capital PLC
19 March 2009
19 March 2009
AMBRIAN CAPITAL PLC
Preliminary Announcement of Results
for the year ended 31 December 2008
Ambrian Capital plc, the natural resources investment bank, today announced its
preliminary results for the year ended 31 December 2008.
Highlights
+-------------------------------------------+--------------------------+--------------------------+
| | Year ended | Year ended |
| | 31 December 2008 | 31 December 2007 |
| | GBPm | GBPm |
+-------------------------------------------+--------------------------+--------------------------+
| Commodities Revenue | 6.39 | 2.53 |
+-------------------------------------------+--------------------------+--------------------------+
| Corporate Finance & Equities Revenue | 3.25 | 8.10 |
+-------------------------------------------+--------------------------+--------------------------+
| Operating Revenue | 9.64 | 10.63 |
+-------------------------------------------+--------------------------+--------------------------+
| Investment Portfolio Losses & Gains | (10.71) | 5.20 |
+-------------------------------------------+--------------------------+--------------------------+
| Total Income | (1.07) | 15.83 |
+-------------------------------------------+--------------------------+--------------------------+
| (Loss)/Profit Before Tax | (16.50) | 5.79 |
+-------------------------------------------+--------------------------+--------------------------+
| (Loss)/Earnings per Share : Basic (pence) | (11.78) | 4.32 |
+-------------------------------------------+--------------------------+--------------------------+
| Annual Dividend per Share (pence) | 1.50 | 1.75 |
+-------------------------------------------+--------------------------+--------------------------+
| | | |
+-------------------------------------------+--------------------------+--------------------------+
| Shareholders' Equity | 30.35 | 45.04 |
+-------------------------------------------+--------------------------+--------------------------+
| Net Asset Value per Share (pence) | 31.6 | 45.1 |
| | | |
+-------------------------------------------+--------------------------+--------------------------+
* Operating revenue decreased by 9.3% to GBP9.64 million from GBP10.63 million
* Operating revenue benefited from strong results in Commodities which partially
offset a weaker performance from Corporate Finance & Equities
* The Investment Portfolio's substantial loss reflects the sharp fall in market
values in the junior natural resources sector. The Investment Portfolio was
valued at GBP1.50 million at the year end after realisations and write downs to
market values
* Ambrian ended the year in a strong financial position, with shareholders' equity
of GBP30.35 million and own cash resources slightly up on the previous
year at GBP22.56 million
* Net asset value per share decreased 30% to 31.6p in a year when the FTSE
All-Share Index declined by 33% and the FTSE AIM Basic Resources Index declined
by 72%
* Final dividend of 0.75p per ordinary share, taking the full year dividend to
1.50p
Commenting on the results, Tom Gaffney, Chief Executive of Ambrian Capital plc,
said:
"During a tumultuous year for commodities and equities Ambrian broadened its
business model and strengthened its franchise. Our Commodities business had an
excellent year with revenue and profit growth also benefiting from the new
physical metals business. The Corporate Finance & Equities business was
adversely affected by the sharp downturn in the junior natural resources sector
and its equity market making activity suffered accordingly.
The Investment Portfolio has now been substantially realised for cash which
ensures Ambrian's ability to withstand difficult market conditions.
Despite the challenging market conditions, Ambrian has had a strong start to
2009. Operating revenue in the first two months is up 70% over the same period
last year with most of the growth coming from our Commodities business. Although
our outlook for the rest of the year is cautious, these figures are encouraging.
This is a time of opportunity for Ambrian. We have the cash resources and the
team that will enable us to take advantage of the continuing uncertainty in the
markets."
+-----------------------------+----------------------------------+--------------------------------+
| Enquiries : - | | |
+-----------------------------+----------------------------------+--------------------------------+
| | | |
+-----------------------------+----------------------------------+--------------------------------+
| Tom Gaffney | Mark Connelly/Ileana Antypas | Charlotte Kirkham |
+-----------------------------+----------------------------------+--------------------------------+
| Chief Executive Officer | Collins Stewart Europe Ltd | M Communications |
+-----------------------------+----------------------------------+--------------------------------+
| Ambrian Capital plc | | |
+-----------------------------+----------------------------------+--------------------------------+
| Tel + 44 (0)20 7634 4700 | Tel + 44 (0)20 7523 8350 | Tel + 44 (0)20 7153 1531 |
+-----------------------------+----------------------------------+--------------------------------+
Notes to Editors :
Ambrian Capital plc
Ambrian Capital (AIM : AMBR) is the holding company of Ambrian Partners Limited,
Ambrian Commodities Limited and Ambrian Metals Limited.
Ambrian Partners Limited is a specialist investment bank focussed on the metals
& mining, oil & gas, and cleantech sectors. It provides corporate finance
advice, equity research, sales and trading and market making services. Ambrian
Partners was ranked first in the AIM Basic Materials Sector in the Hemscott 1st
Quarter 2009 Advisers Rankings Guide. Ambrian Partners is a member of the
London Stock Exchange and is authorised and regulated by the Financial Services
Authority.
Ambrian Commodities Limited is a trader and broker specialising in London Metals
Exchange cleared base metals futures and options. Its customers include metals
producers, consumers, merchants, traders and financial investors. Ambrian
Commodities is an Associate Broker Member of the London Metal Exchange and is
authorised and regulated by the Financial Services Authority.
Ambrian Metals Limited is an independent physical metals trader with particular
strengths in copper, aluminium and lead. Through Ambrian Metals' offices in
London and Shanghai and agents in Calcutta, New York, Santiago, Sao Paolo, Seoul
and Tokyo, it sources non-ferrous metals from producers for distribution to an
international client base of metals consumers and merchants.
Further information on Ambrian Capital is available on the Company's website:
www.ambrian.com
CHAIRMAN'S STATEMENT
2008 was a significant year for Ambrian that saw the Group complete
substantially the realisation of the legacy Investment Portfolio and take a
number of important steps to position the operating businesses for future
growth.
The Group's results for the year were severely affected by the sharp downturn in
most markets and asset classes. In particular, our Investment Portfolio incurred
a significant non-cash mark-to-market loss during the year which under
International Financial Reporting Standards ("IFRS") is reported as negative
revenue.
During 2008, Ambrian's net asset value per share declined by 30% to 31.6p
compared with a 33% decline in the FTSE All-Share Index and a 72% decline in the
FTSE AIM Basic Resources Index. The Group's net asset value per share would
have been more seriously eroded by the collapse in the junior natural resources
sector had we not in 2008 and in previous years taken advantage of liquidity
opportunities and de-risked Ambrian's asset base. In 2008, we realised a net
GBP8.31 million in cash from sales of the Investment Portfolio, almost all of
which was achieved in the first seven months of the year. Own cash represented
74.3% of our net asset value at 31 December 2008 compared with 49.3% at 31
December 2007 and 34.5% at 31 December 2006. Cash has become much more valuable
today than it was a year ago.
The process of shifting the Investment Portfolio into cash and working capital
is now almost complete. In future, we expect that market movements in the
value of the Investment Portfolio will have a much more limited impact on the
Group's total revenue.
The year saw the further development of the Commodities business. Ambrian
Commodities Limited, our LME futures and options trading business, made
substantial progress as it benefited from high customer volumes in base metals
despite the sharp drop in metals prices.
In June, we entered the physical metals business with the recruitment of a
highly experienced London-based team and opened an office in Shanghai with a
staff of four. Ambrian Metals Limited has made a positive contribution and we
expect to see further gains in this business in 2009.
In October, we entered into a strategic alliance with Mizuho Financial Group,
one of Japan's largest financial institutions, to provide LME futures and
options brokerage services to their clients globally.
Ambrian Partners, our Corporate Finance & Equities business, benefited in the
first half of 2008 from commodity prices reaching record highs. However, during
the second half of the year, commodity prices declined sharply as demand decline
caused excess supply. The second half of 2008 proved to be an extremely
challenging operating environment for Ambrian Partners, characterised by a
significant drop in AIM equity prices, reduced levels of liquidity and
negligible investor interest in the small cap natural resources sector. Our
equity market making activity was particularly vulnerable and often found itself
in the position of "buyer of last resort" as it sought to maintain orderly
markets. Ambrian Partners partially mitigated the downward market pressure by
maintaining a low cost base and expanding its retained corporate client base
through the acquisition of Nabarro Wells & Co Limited in April 2008.
The Board is recommending a final dividend of 0.75p per share, which will be
paid on 12 June 2009 to shareholders on the register at 22 May 2009. This would
take the total dividend for the year to 1.50p.
In addition, some 4.38 million shares were bought back during 2008 at a cost of
GBP0.93 million and at an average price of 21.1p per share. The Board sees merit
in having a buy-back capability in place and will be seeking to renew the
necessary authority to buy back shares at the AGM on 2 June 2009.
In December 2008, we announced that we were in merger discussions with Panmure
Gordon & Co plc. The proposed transaction was designed to accelerate the growth
of our Corporate Finance & Equities business and to position Ambrian to benefit
when markets improve and investor confidence returns. After careful
consideration, it was determined that terms could not be agreed that would be in
the best interests of our shareholders. Although the transaction did not
proceed, we regularly assess other strategic opportunities that arise and will
only pursue a transaction that has clear and compelling benefits to our
shareholders.
Finally, I would like to thank the hard working and talented individuals who
make up the Ambrian team for their contributions over the year. There is no
doubt that ours is an intellectual capital business and this combined with the
strength of our balance sheet enables us to navigate short-term market
uncertainties - the outlook for Ambrian continues to look promising.
W L Banks
Chairman
19 March 2009
CHIEF EXECUTIVE'S STATEMENT
During a tumultuous year for commodities and equities Ambrian broadened its
business model and strengthened its franchise. The Commodities business had an
excellent year with revenue and profit growth also benefiting from the new
physical metals business. The Corporate Finance & Equities business was
adversely affected by the sharp downturn in the junior natural resources sector
and its equity market making activity suffered accordingly.
Despite the current global economic uncertainties, we remain convinced that the
long-term investment case for natural resources remains intact. Cyclicality is
inherent in the commodities sector. At some point, sentiment will turn and
industrial output will rise and demand for raw materials will increase. Growing
demographics and the continued industrialisation of China and other emerging
economies are themes that are not going away. Resources and, in particular,
metals, minerals and carbon based energy deplete. In due course, these
resources will need to be replaced with new discoveries or new technologies in
recycling, energy conservation and in cleantech.
Natural resources are our core expertise. Ambrian finances and advises
exploration, development and production companies, we arrange physical metals
distribution once mines are in production and through our LME business we
provide metals price hedging services to producers and consumers.
Ambrian's vision is to become the pre-eminent investment bank to the natural
resources sector. Our strategy is to re-deploy the capital released from the
sale of the Investment Portfolio in revenue generating businesses.
Financial Review
Total income for 2008 was GBP(1.07) million (2007: GBP15.83 million).
Operating revenue declined by 9.3% to GBP9.64 million in 2008 from GBP10.63
million in 2007.
Commodities saw revenue increase by 153% in 2008 to GBP6.39 million from GBP2.53
million in 2007. The growth in revenue was driven by higher customer activity
and entry into the physical metals business.
Before market making, Corporate Finance & Equities had operating revenue of
GBP5.29 million in 2008 (2007: GBP7.35 million), a decrease of 28%. The
decrease is primarily attributable to the reduced level of capital markets
activity in the junior natural resources sector.
After market making losses of GBP2.04 million in 2008 (2007: gains of GBP0.76
million), Corporate Finance & Equities operating revenue was GBP3.25 million for
the year (2007: GBP8.11 million), a decrease of 60%.
The Investment Portfolio had negative income of GBP10.71 million in 2008
compared with positive revenue of GBP5.20 million for 2007. The primary reasons
for the negative revenue were the reduced share prices of publicly-held
investments consistent with declines in the junior natural resources sector and
write-downs in the value of our unlisted investments.
Administrative expenses were GBP15.41 million (2007: GBP10.01 million) of which
GBP11.45 million (2007: GBP7.05 million) were represented by fixed costs (these
exclude non-recurring costs and bonuses). Administrative expenses included
one-off costs associated with the acquisition of Nabarro Wells, start-up costs
associated with the physical metals business and costs associated with the move
to our new offices. Rigorous control of fixed costs is a central feature of
the Group and staff remuneration is geared towards performance. Total headcount
as at 31 December 2008 stood at 70, up 19 during 2008.
The loss before tax for 2008 was GBP16.50 million (2007: profit before tax
GBP5.79 million).
The loss before tax from the operating businesses (Commodities and Corporate
Finance & Equities) for 2008 was GBP1.87 million (2007: profit before tax
GBP4.16 million).
Excluding results from equities market making, the operating businesses
generated profit before tax of GBP0.17 million (2007: profit before tax GBP3.40
million).
The loss before tax from the Investment Portfolio was GBP14.63 million in 2008
compared with a profit before tax of GBP1.63 million for 2007. All central costs
are allocated to the Investment Portfolio.
The net loss after tax for 2008 was GBP11.73 million (2007: net profit after tax
GBP4.51 million).
Basic loss per share was 11.78p (2007 : basic earnings per share 4.32p).
Balance Sheet
We have sought to manage our balance sheet prudently and to continually improve
its liquidity and transparency. Shareholders' equity was GBP30.35 million at 31
December 2008 (31 December 2007: GBP45.04 million), or 31.6p per share (31
December 2007: 45.1p per share).
Financial Position
+-------------------------------------+--------------------+----------+----------------+------------+
| GBP million | As at 31 December 2008 | As at 31 December 2007 |
+-------------------------------------+-------------------------------+-----------------------------+
| | | | | |
+-------------------------------------+--------------------+----------+----------------+------------+
| Total Assets | GBP94.35 | | GBP56.96 | |
+-------------------------------------+--------------------+----------+----------------+------------+
| | | | | |
+-------------------------------------+--------------------+----------+----------------+------------+
| Own Cash | GBP22.56 | 74.3% | GBP22.20 | 49.3% |
+-------------------------------------+--------------------+----------+----------------+------------+
| Working Capital & Fixed Assets | GBP6.29 | 20.7% | GBP2.32 | 5.2% |
+-------------------------------------+--------------------+----------+----------------+------------+
| Investment Portfolio | GBP1.50 | 5.0% | GBP20.52 | 45.5% |
+-------------------------------------+--------------------+----------+----------------+------------+
| Shareholders' Equity | GBP30.35 | 100.0% | GBP45.04 | 100.0% |
+-------------------------------------+--------------------+----------+----------------+------------+
Total assets increased in 2008 primarily as a result of an increase in trade and
other receivables, and a corresponding increase in trade and other payables
associated with the new physical metals business.
The Group's own cash resources, net of amounts due to clients, totalled GBP22.56
million at 31 December 2008 compared with GBP22.20 million at 31 December 2007.
Cash is held on deposit at major UK clearing banks, these being principally
Barclays Bank plc and Royal Bank of Scotland plc.
The aggregate regulatory capital requirement for the Group's regulated
subsidiaries (Ambrian Partners Limited and Ambrian Commodities Limited) was
GBP11.01 million at 31 December 2008 which was substantially exceeded by the
Group's regulatory capital resources.
Our Investment Portfolio was valued at GBP1.50 million at 31 December 2008
compared with GBP20.52 million at 31 December 2007. The reduction in the size of
the Investment Portfolio was due to a combination of the sale during 2008 of
investments with a net value of approximately GBP8.31 million and reductions of
GBP10.71 million in the mark-to-market value of our investments.
While the Group is in a strong financial position, it is applying a disciplined
approach to capital allocation decisions and other expenditures in the current
economic environment.
Corporate Finance & Equities
Ambrian Partners Limited, our Corporate Finance & Equities business, had 42
retained corporate clients at 31 December 2008 compared with 35 at 31 December
2007. In addition to the new clients brought by Nabarro Wells, significant new
client wins include our appointments as nominated adviser to Avocet Mining plc,
BPC Limited and Weatherly International plc. In a challenging equity market
environment, our retained corporate client base provides a stream of recurring
revenue and positions Ambrian Partners at the centre of providing financial
advisory and capital raising services to our clients.
Despite the difficult market conditions prevailing in 2008, Ambrian Partners
completed a number of notable transactions including :
* financial adviser to BPC Limited on its GBP35.5 million reverse takeover of
Falkland Gold and Minerals Limited
* Nominated Adviser to First Calgary Petroleum Limited on its C$923 million
takeover by Eni SpA
* GBP14.4 million equity capital raising for Kalahari Minerals plc
* Nominated Adviser to Solana Resources Limited on its GBP154 million merger with
Gran Tierra Energy Inc
Ambrian Partners has a particularly strong position in the AIM natural resources
sector. According to the Hemscott 1st Quarter 2009 Advisers Rankings Guide,
Ambrian Partners was ranked first in terms of both (i) number and aggregate
market capitalisation of retained Nominated Adviser clients and (ii) number and
aggregate market capitalisation of Corporate Broking clients in the Basic
Materials sector (which includes the metals and mining sector) on AIM. Ambrian
Partners was also ranked fifth in terms of number of Nominated Adviser clients
in the Oil & Gas sector on AIM.
Ambrian Partners' market making activities suffered in the second half of 2008
from the sharp decline in the share prices of junior natural resources companies
listed on AIM and the absence of orderly two-way markets. Two-thirds of the
loss incurred by market making was in the shares of eight companies which
dropped by an average of 83% during 2008. We have now reduced the number of
shares in which we make markets to 40; these are almost entirely retained
corporate clients. We have also reduced the maximum amount of equity capital
allocated to this activity to GBP1.0 million and have instructed our experienced
traders to focus on facilitating client orders and to protect against risk. It
is the nature of market making in the shares of smaller companies that gains and
losses are abrupt and irregular.
Ambrian Partners' strategy is to use the current dislocation in the markets to
acquire new corporate clients from weaker and less focussed competitors and to
recruit industry veterans who share our goal of providing a differentiated,
value-added service that institutional and corporate customers are willing to
pay for. The intention is to gain market share in our existing sectors of
expertise and to selectively build a more broadly-based sector led equities
business. Ambrian Partners will then be in a position to benefit from strong
leverage to the upside when equity markets recover.
Commodities
Ambrian Commodities Limited
Ambrian Commodities trades with a select client base located globally and
generates revenue not by taking speculative positions but by capturing dealing
spreads and earning commissions. The business is client order driven and
benefited from increased customer activity in 2008. Trading volumes on the LME
were significantly higher in 2008 compared with 2007, for example, the volume of
nickel traded was up 37%, grade A copper volume was up 24% and primary aluminium
volume was up 20%. Ambrian Commodities' international client base of industrial
users of metals made active use of the LME to hedge either their raw material
costs or output prices.
In October 2008, Ambrian Commodities entered into a co-operative arrangement
with Mizuho Financial Group, one of Japan's largest financial institutions, to
provide LME futures and options brokerage services to clients globally.
Under this arrangement, Mizuho will be able to offer to its clients around the
world direct access to Ambrian Commodities' LME execution capabilities so that
Mizuho can focus on providing global clearing services.It is anticipated that
the alliance will commence generating earnings in 2009.
Ambrian Metals Limited
In June 2008, we entered the physical metals business with the recruitment of an
experienced international physicals metals team and the establishment of Ambrian
Metals Limited, a wholly-owned Swiss-registered subsidiary. The team comprises
salesmen, traders and logistics managers based in London and Shanghai. In
addition, we now have agents based in Calcutta, New York, Santiago, Sao
Paolo, Seoul and Tokyo. This has significantly expanded our Commodities
business.
Ambrian Metals globally sources non-ferrous metals, with a particular focus on
copper, aluminium and lead, from producers for distribution primarily on a
matched and hedged basis to an international client base. In its first six
months of operation, Ambrian Metals traded physical metals with a value of
approximately US$524 million. Ambrian Metals does not take unhedged metals
price risk but generates revenue by charging its clients a "premium" over the
metal price for providing them with a consistently high-quality product,
logistics services and price management. Ambrian Metals manages all facets of
marketing and distribution including financing from producers to consumers and
has put in place committed trade finance facilities with a syndicate of major
international banks including BNP Paribas, ING, Standard Chartered Bank and
Banque Cantonale Vaudoise.
Investment Portfolio
The Investment Portfolio incurred negative income, before central overheads, of
GBP10.71 million in 2008 as a result of the sharp decline in the market values
of junior natural resources companies. The most significant losses were
attributable to our investments in Minerva Resources plc (loss of
GBP2.34 million after being written down to nil), Golden Prospect Precious
Metals Limited ("GPPM") (loss of GBP1.94 million), and Jubilee Platinum plc
(loss of GBP1.03 million).
The total value of the Investment Portfolio at 31 December 2008 was GBP1.50
million compared with GBP20.52 million at 31 December 2007. The reduction in the
size of the Investment Portfolio was due to a combination of GBP8.31 million of
net realisations and a reduction of GBP10.71 million in market values.
On 28 July 2008, Ambrian Capital sold its 49.96% stake in GPPM for total cash
proceeds of approximately GBP4.24 million and with effect from 15 September 2008
Ambrian Asset Management Limited novated the investment management agreement
with GPPM to a new investment manager.
The largest remaining publicly listed holdings in the Investment Portfolio at 31
December 2008 were Anglesey Mining plc (valued at GBP0.45 million) and Rivington
Street Holdings plc (formerly CommodityWatch plc ) (valued at GBP0.44 million).
Our unlisted portfolio investments have either been realised or written down and
had a book value at 31 December 2008 of GBP0.28 million (31 December 2007 :
GBP0.72 million).
Outlook
After the sharp falls in commodity prices in the second half of 2008, we are
seeing signs of stability in the crude oil markets and a rebound in metals
prices with copper, for example, up 30% since its low point in December 2008.
The Chinese government has pledged to keep economic growth in 2009 at 8% and has
put in place a stimulus package which should support demand for raw
materials.Ambrian's office in Shanghai is seeing at current price levels signs
of metals re-stocking in China and purchases of copper by China's State Reserve
Bureau.
Despite the challenging market conditions we have had a good start to 2009.
Operating revenue in the first two months is up 70% over the same period last
year with most of the growth coming from our Commodities business. Although our
outlook for the rest of the year is cautious, these figures are encouraging.
Tom Gaffney
Chief Executive
19 March 2009
CONSOLIDATED INCOME STATEMENT
Year ended 31 December 2008
+------------------------------+--+------------+------------+-+------------------+-------------------+
| | | | | 2008 | 2007 |
+------------------------------+--+------------+--------------+------------------+-------------------+
| | | | | GBP | GBP |
+------------------------------+--+------------+--------------+------------------+-------------------+
| | | | | | |
+------------------------------+--+------------+--------------+------------------+-------------------+
| Revenue | | | | 9,642,656 | 10,635,226 |
+------------------------------+--+------------+--------------+------------------+-------------------+
| Investment portfolio gains and losses | | (10,711,147) | 5,199,494 |
+----------------------------------------------+--------------+------------------+-------------------+
| | | | | ---------------- | --------------- |
+------------------------------+--+------------+--------------+------------------+-------------------+
| Total Income | | | | (1,068,491) | 15,834,720 |
+------------------------------+--+------------+------------+--------------------+-------------------+
| | | | | | |
+------------------------------+--+------------+------------+--------------------+-------------------+
| Administrative expenses | | | | (15,410,659) | (10,014,900) |
+------------------------------+--+------------+------------+--------------------+-------------------+
| Finance costs | | | | (20,928) | (32,628) |
+------------------------------+--+------------+------------+--------------------+-------------------+
| | | | | ---------------- | --------------- |
+------------------------------+--+------------+------------+--------------------+-------------------+
| (Loss)/profit from | | | | (16,500,078) | 5,787,192 |
| operations | | | | | |
+------------------------------+--+------------+------------+--------------------+-------------------+
| | | | | | |
+------------------------------+--+------------+------------+--------------------+-------------------+
| Income taxes | | | | 4,765,777 | (1,273,636) |
+------------------------------+--+------------+------------+--------------------+-------------------+
| | | | | -------------- | ----------------- |
+------------------------------+--+------------+--------------+------------------+-------------------+
| | | | | | |
+------------------------------+--+------------+--------------+------------------+-------------------+
| (Loss)/profit for the year | | | | (11,734,301) | 4,513,556 |
+------------------------------+--+------------+--------------+------------------+-------------------+
| | | | | ========== | ========== |
| | | | | | |
+------------------------------+--+------------+--------------+------------------+-------------------+
| | | | | | |
+------------------------------+--+------------+--------------+------------------+-------------------+
| (Loss)/Earnings per ordinary | | | | | |
| share | | | | | |
+------------------------------+--+------------+--------------+------------------+-------------------+
| - basic | | | | (11.78)p | 4.32p |
+------------------------------+--+------------+--------------+------------------+-------------------+
| - diluted | | | | (11.78)p | 4.81p |
+------------------------------+--+------------+------------+-+------------------+-------------------+
All of the activities of the group are classed as continuing.
CONSOLIDATED BALANCE SHEET AS AT 31 DECEMBER 2008
+----------------------------------------------+-------+---------------+---------------+
| | | 2008 | 2007 |
+----------------------------------------------+-------+---------------+---------------+
| | | GBP | GBP |
+----------------------------------------------+-------+---------------+---------------+
| ASSETS | | | |
+----------------------------------------------+-------+---------------+---------------+
| Non-current assets | | | |
+----------------------------------------------+-------+---------------+---------------+
| Property, plant and equipment | | 352,317 | 126,852 |
+----------------------------------------------+-------+---------------+---------------+
| Intangible assets | | 2,430,109 | 1,836,828 |
+----------------------------------------------+-------+---------------+---------------+
| Deferred tax asset | | 1,051,417 | - |
+----------------------------------------------+-------+---------------+---------------+
| | | ------------ | ------------ |
+----------------------------------------------+-------+---------------+---------------+
| | | 3,833,843 | 1,963,680 |
+----------------------------------------------+-------+---------------+---------------+
| Current Assets | | | |
+----------------------------------------------+-------+---------------+---------------+
| Financial assets at fair value through | | 2,636,135 | 23,888,023 |
| profit or loss | | | |
+----------------------------------------------+-------+---------------+---------------+
| Inventory | | 9,008,759 | - |
| Trade and other receivables | | 30,578,089 | 5,989,445 |
+----------------------------------------------+-------+---------------+---------------+
| Current tax recoverable | | 1,169,155 | - |
+----------------------------------------------+-------+---------------+---------------+
| Cash at bank and in hand | | 47,123,092 | 27,080,761 |
+----------------------------------------------+-------+---------------+---------------+
| | | ------------- | ------------ |
+----------------------------------------------+-------+---------------+---------------+
| | | 90,515,230 | 56,958,229 |
+----------------------------------------------+-------+---------------+---------------+
| | | ------------- | ------------ |
+----------------------------------------------+-------+---------------+---------------+
| Total Assets | | 94,349,073 | 58,921,909 |
+----------------------------------------------+-------+---------------+---------------+
| | | ------------- | ------------- |
+----------------------------------------------+-------+---------------+---------------+
| | | | |
+----------------------------------------------+-------+---------------+---------------+
| LIABILITIES | | | |
+----------------------------------------------+-------+---------------+---------------+
| Current liabilities | | | |
+----------------------------------------------+-------+---------------+---------------+
| Trade and other payables | | (63,614,307) | (10,311,594) |
+----------------------------------------------+-------+---------------+---------------+
| Current tax payable | | (381,539) | (1,482,563) |
+----------------------------------------------+-------+---------------+---------------+
| | | ------------- | ------------ |
+----------------------------------------------+-------+---------------+---------------+
| | | (63,995,846) | (11,794,157) |
+----------------------------------------------+-------+---------------+---------------+
| | | ------------- | ------------- |
+----------------------------------------------+-------+---------------+---------------+
| Non-current liabilities | | | |
+----------------------------------------------+-------+---------------+---------------+
| Deferred tax liabilities | | - | (2,090,110) |
+----------------------------------------------+-------+---------------+---------------+
| | | ------------- | ------------ |
+----------------------------------------------+-------+---------------+---------------+
| Total Liabilities | | (63,995,846) | (13,884,267) |
+----------------------------------------------+-------+---------------+---------------+
| | | ------------- | ------------ |
+----------------------------------------------+-------+---------------+---------------+
| Net Assets | | 30,353,227 | 45,037,642 |
+----------------------------------------------+-------+---------------+---------------+
| | | ========== | ========== |
+----------------------------------------------+-------+---------------+---------------+
| | | | |
+----------------------------------------------+-------+---------------+---------------+
| CAPITAL AND RESERVES | | | |
+----------------------------------------------+-------+---------------+---------------+
| Called up share capital | | 11,136,121 | 11,136,121 |
+----------------------------------------------+-------+---------------+---------------+
| Share premium account | | 11,105,383 | 11,105,383 |
+----------------------------------------------+-------+---------------+---------------+
| Merger reserve | | 1,245,256 | 1,245,256 |
+----------------------------------------------+-------+---------------+---------------+
| Treasury shares | | (1,092,831) | (163,217) |
+----------------------------------------------+-------+---------------+---------------+
| Retained earnings | | 13,503,722 | 26,957,576 |
+----------------------------------------------+-------+---------------+---------------+
| Reserve for share based payments | | 835,281 | 636,342 |
+----------------------------------------------+-------+---------------+---------------+
| Employee benefit trust | | (5,880,660) | (5,879,819) |
+----------------------------------------------+-------+---------------+---------------+
| Exchange reserve | | (499,045) | - |
+----------------------------------------------+-------+---------------+---------------+
| | | ------------- | ------------- |
+----------------------------------------------+-------+---------------+---------------+
| | | 30,353,227 | 45,037,642 |
+----------------------------------------------+-------+---------------+---------------+
| | | ========== | ========== |
+----------------------------------------------+-------+---------------+---------------+
CONSOLIDATED CASH FLOW STATEMENT
Year ended 31 December 2008
+----------------------------------------------+----------------+---------------+
| | 2008 | 2007 |
+----------------------------------------------+----------------+---------------+
| | GBP | GBP |
+----------------------------------------------+----------------+---------------+
| Cash flows from operating activities | | |
+----------------------------------------------+----------------+---------------+
| | | |
+----------------------------------------------+----------------+---------------+
| (Loss)/profit for the year | (11,734,301) | 4,513,556 |
+----------------------------------------------+----------------+---------------+
| Adjustments for | | |
+----------------------------------------------+----------------+---------------+
| Depreciation | 174,691 | 104,954 |
+----------------------------------------------+----------------+---------------+
| Impairment of property plant and machinery | 118,571 | - |
| Impairment of intangible assets | 140,000 | - |
| Foreign exchange (gains)/losses | (2,979) | (357,915) |
+----------------------------------------------+----------------+---------------+
| Taxation (credit)/expense recognised in | (4,765,777) | 1,273,636 |
| income statement | | |
+----------------------------------------------+----------------+---------------+
| Unrealised (gains)/losses on financial | 9,532,263 | 4,009,590 |
| assets | | |
| designated at fair value | | |
+----------------------------------------------+----------------+---------------+
| Realised losses/(gains) on financial assets | 1,148,420 | (9,209,084) |
| designated at fair value | | |
+----------------------------------------------+----------------+---------------+
| Net proceeds on disposals of financial | 10,571,205 | 17,608,262 |
| assets | | |
| designated at fair value | | |
+----------------------------------------------+----------------+---------------+
| (Increase) in inventory | (9,008,759) | - |
| (Increase) in trade and other receivables | (24,588,644) | (2,132,815) |
+----------------------------------------------+----------------+---------------+
| Increase/(decrease) in trade and other | 53,302,713 | (7,258,813) |
| payables | | |
+----------------------------------------------+----------------+---------------+
| Share based payment | 198,939 | 93,080 |
+----------------------------------------------+----------------+---------------+
| | ------------- | ------------- |
+----------------------------------------------+----------------+---------------+
| Cash generated from operations | 25,086,342 | 8,644,451 |
+----------------------------------------------+----------------+---------------+
| Taxation | (645,929) | (3,499,196) |
+----------------------------------------------+----------------+---------------+
| | ------------- | ------------- |
+----------------------------------------------+----------------+---------------+
| Net cash from operating activities | 24,440,413 | 5,145,255 |
+----------------------------------------------+----------------+---------------+
| | ------------- | ------------- |
+----------------------------------------------+----------------+---------------+
| | | |
+----------------------------------------------+----------------+---------------+
| Cash flows from investing activities | | |
+----------------------------------------------+----------------+---------------+
| Purchase of property, plant and equipment | (577,559) | (32,040) |
+----------------------------------------------+----------------+---------------+
| Disposal of property, plant and equipment | 58,832 | - |
+----------------------------------------------+----------------+---------------+
| Disposal/acquisition of subsidiary (net of | (733,281) | (3,483,677) |
| cash acquired) | | |
+----------------------------------------------+----------------+---------------+
| | ------------- | ------------- |
+----------------------------------------------+----------------+---------------+
| Net cash used by investing activities | (1,252,008) | (3,515,717) |
+----------------------------------------------+----------------+---------------+
| | ------------- | ------------- |
+----------------------------------------------+----------------+---------------+
| Cash flows from financing activities | | |
+----------------------------------------------+----------------+---------------+
| Proceeds of issue of share capital | - | 586,000 |
+----------------------------------------------+----------------+---------------+
| Employee share benefit trust | (841) | (4,066,262) |
+----------------------------------------------+----------------+---------------+
| Treasury shares acquired | (929,614) | - |
+----------------------------------------------+----------------+---------------+
| Dividends paid | (1,719,553) | (1,834,719) |
+----------------------------------------------+----------------+---------------+
| | ------------- | ------------- |
+----------------------------------------------+----------------+---------------+
| Net cash used in financing activities | (2,650,008) | (5,314,981) |
+----------------------------------------------+----------------+---------------+
| | ------------- | ------------- |
+----------------------------------------------+----------------+---------------+
| | | |
+----------------------------------------------+----------------+---------------+
| Net increase/(decrease) in cash and cash | 20,538,397 | (3,685,443) |
| equivalents | | |
+----------------------------------------------+----------------+---------------+
| Cash and cash equivalents at the beginning | 27,080,761 | 30,408,289 |
| of the year | | |
+----------------------------------------------+----------------+---------------+
| Foreign exchange (losses)/gains | (496,066) | 357,915 |
+----------------------------------------------+----------------+---------------+
| | ------------ | ------------ |
+----------------------------------------------+----------------+---------------+
| Cash and cash equivalents at the end of the | 47,123,092 | 27,080,761 |
| year | | |
+----------------------------------------------+----------------+---------------+
| | ========== | ========== |
+----------------------------------------------+----------------+---------------+
NOTES TO THE ACCOUNTS
Year ended 31 December 2008
1 The financial information set out in the announcement does not constitute the
company's statutory
accounts for the years ended 31 December 2008 or 2007. The financial
information for the
year ended 31 December 2007 is derived from the statutory accounts
for that year which have been
delivered to the Registrar of Companies.
The audit of the statutory accounts for the year ended 31 December 2008 is
complete. The auditors reported on those accounts; their report was unqualified
and did not include references to any matters to which the auditors drew
attention to by way of emphasis without qualifying their report and did not
contain a statement under s237(2) or (3) Companies Act 1985. These accounts will
be delivered to the Registrar of Companies following the company's annual
general meeting.
While the financial information included in this preliminary announcement has
been prepared in accordance with the recognition and measurement criteria of
International Financial Reporting Standards (IFRSs), this announcement does not
itself contain sufficient information to comply with IFRSs. The Company expects
to publish full financial statements that comply with IFRSs in April 2009.
2 Earnings per Ordinary Share
The calculation of the basic earnings per share is based on the earnings
attributable to ordinary shareholders divided by the weighted average number of
shares in issue during the year.
The calculation of diluted earnings per share is based on the basic earnings per
share adjusted to allow for the issue of shares on the assumed conversion of all
dilutive options.
Reconciliations of the earnings and weighted average number of shares in the
calculations are set out below.
Continuing Operations
+------------------+----------------+--------------+-------------+-------------+----------------+------------+
| | | 2008 | | | 2007 |
+------------------+----------------+--------------+---------------------------+----------------+------------+
| | (Loss) | Weighted | Per share | Earnings | Weighted | Per share |
| | GBP | average | amount | GBP | average number | amount |
| | | number of | (pence) | | of shares | (pence) |
| | | shares | | | | |
+------------------+----------------+--------------+-------------+-------------+----------------+------------+
| Basic | | | | | | |
| (loss)/earnings | | | | | | |
| per share | (11,734,301) | 99,579,821 | (11.78)p | 4,513,556 | 104,406,818 | 4.32p |
+------------------+----------------+--------------+-------------+-------------+----------------+------------+
| | ========== | | ========== | ========= | | ======= |
+------------------+----------------+--------------+-------------+-------------+----------------+------------+
| Dilutive effect | | | | | | |
| of share options | | | | | | |
| | | - | | | 3,612,831 | |
| | | | | | | |
+------------------+----------------+--------------+-------------+-------------+----------------+------------+
| | | ------------ | | | ------------ | |
+------------------+----------------+--------------+-------------+-------------+----------------+------------+
| Diluted | | | | | | |
| (loss)/earnings | | | | | | |
| per share | (11,734,301) | 99,579,821 | (11.78)p | 4,513,556 | 108,019,649 | 4.18p |
+------------------+----------------+--------------+-------------+-------------+----------------+------------+
| | ========== | ========== | ========== | ========= | ========== | ======= |
+------------------+----------------+--------------+-------------+-------------+----------------+------------+
No dilutive effect of the share options is shown for the year ended 31 December
2008 as their effect is anti-dilutive. Had there been a dilutative effect for
the year ended 31 December 2008, the calculation would have been based on
weighted average number of shares of 99,733,870.
3 Cash at Bank and in Hand
Cash at bank and in hand includes amounts of GBP24,561,062 (2007: GBP4,877,995)
held as deposits on trading positions and on behalf of third parties.
Copies of the 2008 accounts will be posted to shareholders in due course. Copies
of this announcement are available from the Company at Old Change House, 128
Queen Victoria Street, London EC4V 4BJ.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR CKFKDNBKBDND
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