RNS Number:4798F
Aquilo PLC
30 June 2006
Aquilo PLC ("Aquilo" or "the Company")
ANNUAL RESULTS FOR THE YEAR ENDED 31 DECEMBER 2005
30 June 2006
CHAIRMAN'S STATEMENT
I am pleased to present the Aquilo Plc report and accounts for the year ended 31
December 2005.
Business Review
I am pleased to report that 2005 was a year of major transition and great
progress for Aquilo. We began the year in the final stages of completing the
acquisition of ABS Bodyshop Services Ltd which also involved moving the centre
of operations from North London to Northwich in Cheshire where ABS had its
headquarters. There then followed 12 months of remarkable shift and change.
Recruitment of both personnel and clients has been relentless and highly
successful and I am grateful to my fellow directors and staff for their efforts
in helping to make this such an exciting year.
In headline terms turnover is up from #3,724,512 (2004) to #19,694,369, an
increase of 429 per cent. The loss before interest increasing by 6.2 per cent
from #1,211,865 to #1,287,014.
The most important event in the Company's first half was the completion of the
acquisition of ABS Bodyshop Services, a substantial business which has
transformed the group's profit and loss account and balance sheet.
During the year we also acquired HFC Select in Edinburgh specialising in
"like-for-like" replacement items for insurance claims. Later in the year we
sold the AccidentCare membership services business and all associated
intellectual property to Broker Assistance Ltd for a total of #360,000. In
addition, we disposed of the loss making motor engineering inspection services
during the latter part of 2005.
Following the acquisition of ABS and the move to Northwich we undertook a
sale-and-leaseback of our new headquarters for #3.1m, realising a book profit of
#0.8m, which after repaying the mortgage and clearing its overdraft, left us
with net cash to fund the growth and further transformation of Aquilo.
I am happy to report that Noble and Company was appointed nominated adviser and
broker to the Company on 23rd June 2005.
FINANCIAL PERFORMANCE FOR 2005
2005 2004 % Change from 2004
# #
Turnover 19,694,369 3,724,512 Increased by
429%
Cost of Sales 15,974,420 1,755,611 Increased by
810%
Administrative 5,780,510 2,936,452 Increased by
Expenses 97%
Loss before interest (1,287,014) (1,211,865) Losses increased by
6%
Balance Sheet Net (120,638) 627,102 Decreased by
(Liabilities)/Assets 119%
STAFF
I am delighted to report that several new directors, both executive and non
executive, were recruited during the year. Peter Friend, formerly Chairman of
the Affinity Division of Aon Limited, was appointed to the Board in August and
Michael Dean, Managing Director of Aquilo Business Solutions, and John Ascroft,
Managing Director of Aquilo Motor Services, joined the Board in November.
Other senior appointments include Arthur Rackstraw, who joined us Managing
Director of Aquilo Inspection and Reinstatement Services, and Colin Dawes as
Technical Claims Director of Aquilo Business Solutions.
The appointments made during 2005 have laid the foundations for an exciting
future for the Company. We believe we now have in place people - at all levels
- of exceptional talent. I would like to take this opportunity to thank them
for their hard work and unstinting commitment throughout the year.
RESULTS AND DIVIDENDS
Details of the results are contained in the Directors' Report. The directors do
not recommend the payment of a dividend.
OUTLOOK FOR 2006
The first half of 2006 has seen the continued transformation of Aquilo with the
acquisition of IT Solutions GB Ltd (ITS), the establishment of Aquilo Inspection
and Reinstatement Services under the direction of Arthur Rackstraw and the
signing of significant new contracts.
ITS is a specialist provider of valuation, replacement and repair services of IT
equipment to the insurance industry. It also supplies equipment and business
continuity services to companies and organisations. ITS's headquarters are
located near Leeds, Yorkshire. ITS will form part of Aquilo's property claims
services and will broaden the existing supply chain services offered by Aquilo.
In the last full year of trading (ending 31 July 2005), ITS had a turnover of
#11.66 million. It is anticipated that as part of Aquilo, ITS will continue to
grow significantly its turnover and will contribute in excess of #50,000 per
month of net profit. This will expedite Aquilo's return to profitability.
Aquilo Inspection and Reinstatement Services (AIRS) has now been established
with premises in Edwinstowe, Nottinghamshire. It has recruited a team of
skilled and experienced staff, put in place a contractor network and a building
engineer network, and developed a leading edge software platform to support the
range of services it offers. All the signs point to AIRS building significant
turnover in the second half of 2006.
The other divisions within the Aquilo group have all signed significant new
contracts and these will start to feed through to significant additional
turnover in the final six months of 2006.
The developments (disposal of loss making activities, the acquisition of
profitable, new businesses and the signing of significant contracts) within
Aquilo mean that the Group now has the resources and substance to develop
attractive value propositions for the insurance sector, achieve profitability
and significant growth. In addition, Aquilo has developed a shape for its
business which is increasingly being seen as attractive by the insurance market
place.
In conclusion, I would like to use this opportunity to thank staff, customers,
suppliers and shareholders for their continued support. Through their combined
efforts, Aquilo is now in a position to make significant strides over the coming
months and into the future.
Professor Kevin Keasey
Chairman
30 June 2006
Contacts:
Clive Nicholls - Chief Executive Officer - Tel: 07734 157841
Alan Frame - Equity Development - Tel: 0207 405 7777
Nairn Black, Alasdair Robinson - Noble & Company Limited - 0131 225 9677
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2005
The directors present their annual report and the audited financial statements
for the year ended 31 December 2005.
PRINCIPAL ACTIVITIES
The company's principal activity is that of a holding company. The principal
activities of the group are claims management and advisory services.
BUSINESS REVIEW
A review of the Group's business and the outlook for the year ahead is contained
in the Chairman's Statement.
RESULTS AND DIVIDENDS
The Group incurred a loss before tax for the year to 31 December 2005 of
#1,445,978 (2004: #1,265,094). This disappointing result would have been a good
deal healthier had it not been for the losses made by motor engineering
inspection services (now disposed of) and the need to make significant changes
to ABS Bodyshop Services Ltd (now achieved). None the less, 2005 saw major
transition and great progress for Aquilo. At this point in the Group's
development, the directors do no recommend the payment of a dividend.
POST BALANCE SHEET EVENTS
Aquilo continues to rationalise, transform and grow its business operations, and
there have been a number of significant post balance sheet events.
Aquilo Inspection and Reinstatement Services (AIRS) has been established during
the first half of 2006 with premises in Edwinstowe, Nottinghamshire. It has
recruited a team of skilled and experienced staff, put in place a Contractor
network and a Building Engineer network, and developed a leading edge software
platform to support the range of services it offers. All the signs point to
AIRS building significant turnover in the second half of 2006.
The other divisions with the Aquilo group have all signed significant new
contracts and these will start to feed through to significant additional
turnover in the final six months of 2006 reaching full run rate in 2007 and
beyond.
During June 2006, Aquilo acquired IT Solutions GB Ltd (ITS). ITS is a
specialist provider of valuation, replacement and repair services of IT
equipment to the insurance industry. It also supplies equipment and business
continuity services to companies and organisations. ITS's headquarters are
located near Leeds, West Yorkshire. ITS will form part of Aquilo's property
claims services and will broaden the existing supply chain services offered by
Aquilo. In the last full year of trading (ending 31 July 2005), ITS had a
turnover of #11.66 million. It is anticipated that as part of Aquilo, ITS will
continue to grow significantly its turnover and will contribute in excess of
#50,000 per month of net profit. This will expedite Aquilo's return to
profitability.
The developments (the acquisition of profitable new businesses, closure of non
profitable elements, disposal of non core activities and the signing of
significant contracts) within Aquilo mean that the Group now has the resources
and substance to develop attractive value propositions for the insurance sector
and the achieve profitability through significant growth.
DIRECTORS AND DIRECTORS' INTERESTS
The directors of the company during the year and their beneficial interests in
the issued share capital of the company at the beginning and end of the year
were as follows:
Ordinary 1p Shares
2005 2004
M Eve 5,766,192 3,801,192
R Hyett (non executive - resigned 31 January 2005) 11,619,778 11,619,778
Prof K Keasey 24,656,193 24,656,193
C Nicholls 287,715 285,715
A Hodgkinson
(appointed 1 February 2005, resigned 31 March 2005) - -
D Swann (appointed 1 February 2005, resigned 31 March 2005) - -
K Vella (appointed 1 April 2005) - -
P R H Friend (appointed 1 August 2005) - -
J Ascroft (appointed 1 November 2005) - -
M Dean (appointed 1 November 2005) - -
Options over shares in the company held or granted to directors serving at the
year end were as follows:-
Number of Granted Option Exercised Lapsed Number of Exercisable Expiry
options at in period price in period options at from date
01/01/2005 31/12/2005
M Eve 121,528 - 1.75p - 121,528 - May 02 April 05
121,528 - 1.75p - - 121,528 May 03 April 06
1,965,000 - Nil 1,965,000 - Nov 03 Nov 06
800,000 - 1.75p - - 800,000 Jul 04 Jul 14
C Nicholls 25,000 - 1.75p - 25,000 - Oct 02 Oct 05
14,583 - 1.75p - 14,583 - Oct 02 Oct 05
643,400 - Nil - - 643,400 Nov 03 Nov 06
800,000 - 1.75p - - 800,000 Jul 04 Jul 14
1,000,000 - 1.75p - - 1,000,000 Oct 14 Oct 14
K Keasey 375,000 - Nil - - 375,000 Nov 03 Nov 06
800,000 - 1.75p - - 800,000 Jul 04 Jul 14
In addition, the options granted in the prior year by Professor K Keasey and
Ross Hyett over 8.8235 million ordinary Shares and 3.6765 million ordinary
Shares respectively in favour of Clive Nicholls (8 million ordinary Shares) and
Mike Eve (4.5 million ordinary Shares), with an exercise price of 6p and
exercisable during the period of 18 months from 4 May 2004 have now lapsed
without any of these options having been exercised.
FINANCIAL INSTRUMENTS
The Group's principal financial instruments comprise third party loan notes,
finance leases and cash. The main purpose of these financial instruments is to
raise finance for the Group's operations. The Group has various other financial
instruments such as trade debtors and trade creditors, which arise directly from
its operations.
The Group regularly reviews its interest and liquidity exposures and, where it
deems appropriate, takes action to minimise the impact on the business of
interest and currency movements. It is, and has been throughout the period
under review, the Group's policy that no speculation or trading in financial
instruments shall be undertaken.
SUPPLIER PAYMENT POLICY
Neither the Company nor the Group has a standard code that deals specifically
with the payment of suppliers. However, suppliers are made aware of payment
terms and how any disputes are to be settled, and payment is made in accordance
with those terms.
The average creditor days for the year ended 31 December 2005 were 39 days
(2004: 128 days).
POLITICAL AND CHARITABLE CONTRIBUTIONS
The group made no political or charitable contributions during the year.
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS
So far as the directors are aware, at the time the report is approved there is
no relevant audit information of which the company's auditors are unaware, and
each director has taken all the steps that he ought to have taken as a director
in order to make himself aware of any relevant audit information and to
establish that the company's auditors are aware of that information.
AUDITORS
A resolution for the reappointment of PKF (UK) LLP will be proposed at the
forthcoming Annual General Meeting.
On behalf of the board
Professor Kevin Keasey
Chairman
30 June 2006
CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2005
2005 2005 2005 2005 2004
Notes Continuing Acquisitions Discontinued Total Total
# # # # #
TURNOVER 1,469,755 17,279,037 945,577 19,694,369 3,724,512
Cost of Sales (788,980) (15,054,815) (130,625) (15,974,420) (1,755,611)
---------- ------------ --------- ----------- -------------
GROSS PROFIT 680,775 2,224,222 814,952 3,719,949 1,968,901
Administrative expenses - exceptional 3 (52,395) - - (52,395) (130,750)
- other (2,275,183) (2,449,186) (1,003,746) (5,728,115) (2,805,702)
---------- ------------ --------- ----------- -------------
(1,646,803) (224,964) (188,794) (2,060,561) (967,551)
Other operating income 650 86,400 - 87,050 -
---------- ------------ --------- ----------- -------------
OPERATING(LOSS)/PROFIT 2,3 (1,646,153) (138,564) (188,794) (1,973,511) (967,551)
Profit/(loss) on sale of operations 3 294,953 (79,452)
Reorganisation and restructuring costs 3 (392,456) (164,862)
Profit on disposal of fixed assets 3 784,000 -
----------- -------------
LOSS ON ORDINARY ACTIVITIES BEFORE INTEREST (1,287,014) (1,211,865)
Interest receivable and similar income 6 34,617 3,715
Interest payable and similar charges 7 (193,581) (56,944)
----------- -------------
LOSS ON ORDINARY ACTIVITIES BEFORE TAXATION (1,445,978) (1,265,094)
Tax on losses on ordinary activities 8
4,545 -
----------- ------------
LOSS FOR THE FINANCIAL YEAR AFTER TAXATION (1,441,433) (1,265,094)
MINORITY INTERESTS (10,752) -
----------- -------------
RETAINED LOSS FOR THE YEAR (1,452,185) (1,265,094)
============ =============
LOSS PER SHARE
Basic 9 (0.5p) (0.06p) (0.4p) (0.6p)
------ ------- ------ ------
Fully diluted 9 (0.5p) (0.06p) (0.4p) (0.5p)
====== ======= ====== ======
There are no recognised gains and losses other than as reflected in the profit
and loss account.
There are no difference between the loss on ordinary activities before taxation
above and the historical cost loss.
The notes form an integral part of these financial statements.
CONSOLIDATED BALANCE SHEET
AT 31 DECEMBER 2005
2005 2004
Notes # # # #
FIXED ASSETS
Intangible assets - negative goodwill 11 - (32,804)
Intangible assets - other 11 1,640,297 466,480
----------- -----------
1,640,297 433,676
Tangible assets 12 615,124 144,457
Investments 13 51,550 51,550
----------- -----------
2,306,971 629,683
CURRENT ASSETS
Stocks 103,897 -
Debtors 14 2,528,413 1,111,145
Cash at bank and in hand 841,948 9,101
----------- -----------
3,474,258 1,120,246
CREDITORS:
Amounts falling due within one year 15 (4,180,867) (1,086,827)
----------- -----------
NET CURRENT (LIABILITIES)/ASSETS (706,609) 33,419
----------- -----------
TOTAL ASSETS LESS CURRENT LIABILITIES 1,600,362 663,102
============ ===========
CREDITORS:
Amounts falling due after more
than one year 16 1,707,527 -
Provisions for liabilities and charges 19 13,473 36,000
CAPITAL AND RESERVES
Called up share capital 20 3,297,957 2,907,531
Share premium account 21 1,410,042 1,126,872
Shares to be issued 22 250,000 250,000
Profit and loss account 21 (5,109,486) (3,657,301)
----------- -----------
SHAREHOLDERS' FUNDS 22 (151,487) 627,102
MINORITY INTERESTS 30,849 -
----------- -----------
1,600,362 663,102
=========== ===========
The notes form an integral part of these financial statements.
The financial statements were approved by the board of directors on 29 June 2006
and were signed on its behalf by:-
Professor Kevin Keasey
Chairman
CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2005
2005 2004
Notes # #
CASH FLOW STATEMENT
Cash flow from operating activities 26 (554,732) (1,600,238)
Returns on investments and servicing
of finance 27 (158,964) (53,229)
Taxation 27 (13,517) -
Capital expenditure and financial
investment 27 2,698,397 (99,586)
Acquisitions and disposals 27 (1,831,757) (45,877)
----------- -----------
Cash inflow/(outflow) before
management of liquid resources
and financing 139,427 (1,798,930)
Financing 27 675,828 2,286,433
----------- -----------
Increase in cash in the year 815,255 487,503
========== ===========
RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET DEBT
Increase in cash in the year 815,255 487,503
Cash outflow from changes in net debt 297,811 8,920
Loan stock converted to share capital - 795,000
Loans and finance leases acquired with subsidiary (1,981,327) -
Loan notes issued for acquisition of subsidiary (402,437)
----------- -----------
Movement in net debt in the year (1,270,698) 1,291,423
Net fund/(debt) at the start of the year 9,101 (1,282,322)
----------- -----------
Net (debt)/fund at the end of
the year 28 (1,261,597) 9,101
=========== ===========
These notes form an integral part of these financial statements.
SELECTED NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2005
1. LOSS PER SHARE
Group
2005 2004
# #
Loss on ordinary activities after taxation (1,441,433) (1,265,094)
=========== ===========
Weighted average number of shares in issue - basic 323,939,983 222,928,873
Dilutive shares - exercise of share options 2,761,456 4,270,000
----------- -----------
Weighted average number of shares in issue - diluted 326,701,439 227,198,873
=========== ===========
Basic loss per share (0.4p) (0.6p)
=========== ===========
Diluted loss per share (0.4p) (0.5p)
=========== ===========
2. CALLED UP SHARE CAPITAL
2005 2004
# #
Authorised
600,000,000 (2004: 400,000,000) ordinary shares of 1p each 6,000,000 4,000,000
=========== ===========
Allotted, called up and fully paid
329,795,672 (2004: 290,753,064) ordinary shares of 1p each 3,297,957 2,907,531
=========== ===========
On 1 August 2005, the company's authorised share capital was
increased from #4,000,000 (ordinary shares: 400,000,000) to #6,000,000 (ordinary
shares: 600,000,000).
During the year:
The company issued 28,354,400 1p ordinary shares at a premium of 0.75p as part
of the consideration for the acquisition of 97.8% of the shares of Aquilo Motor
Services Limited (formerly ABS Bodyshop Limited).
A further 3,251,600 1p ordinary shares were issued at par and an
additional 2,937,500 1p ordinary shares were issued at a premium of 0.75p as a
result of share options being exercised.
The company issued 4,285,715 1p ordinary shares at a premium of
0.75p as partial consideration for the acquisition of the trade and assets of
HFC Select Limited.
3. POST BALANCE SHEET EVENTS
Aquilo Inspection and Reinstatement Services (AIRS) has been established during
the first half of 2006 with premises in Edwinstowe, Nottinghamshire. It has
recruited a team of skilled and experienced staff, put in place a Contractor
network and a Building Engineer network, and developed a leading edge software
platform to support the range of services it offers.
During June 2006, Aquilo acquired IT Solutions GB Ltd (ITS). ITS is a
specialist provider of valuation, replacement and repair services of IT
equipment to the insurance industry. It also supplies equipment and business
continuity services to companies and organisations. ITS's headquarters are
located near Leeds, West Yorkshire. ITS will form part of Aquilo's property
claims services and will broaden the existing supply chain services offered by
Aquilo. In the last full year of trading (ending 31 July 2005), ITS had a
turnover of #11.66 million.
Copies of the Annual Report, of which this announcement is an abridged version,
for the year ended 31 December 2005 will be sent to shareholders as soon as
practicable. Further copies will be available from the Company's registered
address: Meridian House, Gadbrook Park Northwich, Cheshire CW9 7RA; or can be
downloaded from the company's website. www.aquiloplc.co.uk
This information is provided by RNS
The company news service from the London Stock Exchange
END
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