TIDMLIN TIDMLINC
RNS Number : 3846E
LitComp Plc
18 December 2009
18 December 2009
LITCOMP PLC
(AIM:LIN)
("LitComp" or "the Company" or "the Group")
UNAUDITED INTERIM RESULTS FOR THE SIX MONTHS TO
30 SEPTEMBER 2009
The Board of LitComp Plc, the national provider of After the Event ("ATE")
insurance, medico-legal reports and litigation services, is pleased to announce
its unaudited interim results for the six months ended 30 September 2009. These
results have been reviewed by the Company's auditors.
HIGHLIGHTS
? Net profit before tax increased from GBP0.877M to GBP0.913M
? Basic earnings per share remained constant at 9.2p
? Fully diluted earnings per share decreased from 3.8p to 3.4p
? Elite's gross premium income down from GBP15.76M to GBP14.94M
-END-
Enquiries:
LitComp Plc
Jason Smart
Chief Executive Officer +44 (0) 1476 560 113
Paul Lavender
Finance Director +44 (0) 2085 004
044
Seymour Pierce Limited
Chris Howard +44 (0) 2071 078
047
Christopher Wren
Bishopsgate Communications Limited
Maxine Barnes +44 (0) 2075 623 350
Gemma O'Hara
LITCOMP PLC
RESULTS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2009
CHAIRMAN'S STATEMENT
I am pleased to announce the unaudited Interim Results for the six months ended
30 September 2009.
Financial summary
* The Group made a net profit before tax of GBP0.913M (2008 GBP0.877M)
* Basic earnings per share remained constant at 9.2p
* Fully diluted earnings per share decreased from 3.8p to 3.4p
* Group cash balances were GBP2.301M (2008 GBP3.498M) and overdrafts GBP0.191M
(2008 GBP0.160M); invoice discounting facilities utilised GBP0.464M (2008
GBP0.270M)
Review and Current Prospects
Elite Insurance Company Limited
During the six months ended 30 September 2008 Elite's results benefited from a
large single transaction which had a disproportionate effect on gross premium
income for that period; despite this "windfall" gross premium income not having
recurred in the six months under review Elite's gross premium income during the
period has dropped by only 5.18% to GBP14.94M (2008 GBP15.76M). Elite's gross
premium income has increased by 8.5% from the GBP13.76M achieved during the six
months ending 31 March 2009.
As Elite generates more than 90% of Group turnover, and all Group net profit,
the Directors have felt it appropriate during the period under review for Elite
to bear the majority of Head Office and Central costs; despite this Elite has
generated a net profit before tax of GBP0.900M during the six months under
review (2008 GBP1.484M). Note that if these costs had been allocated to Elite
for the six months ended 30 September 2008 the comparable net profit pre tax for
Elite would have been circa GBP0.870M.
The Directors have negotiated new reinsurance treaties during the period under
review which took effect 1st April 2009. These treaties have increased Elite's
retention on the smaller, lower risk element of its business and reduced its
retention on larger cases, which the Directors believe improves the overall risk
profile for Elite. Elite's reinsurance is now placed with two leading
international reinsurers.
The predominance of deferred premiums in the After The Event ("ATE") market has
constricted Elite's cash flow which has been impacted by a concentration of
claims paid during the six months under review. Cash will be further impacted by
a small number of claims to be paid during the rest of 2009; however all these
claims have been prudently reserved in historic accounts. They will therefore
not impact profitability other than in relation to reinsurance profit
commissions receivable, which are reserved on the basis of anticipated cash
performance for the underwriting year concerned.
Elite's bordereaus have historically included an element of cancelled premiums
which have previously been written off against each month's gross premium
income, however given the slowing down of growth in the ATE business the
Directors feel it is now prudent to make a specific reserve against such
cancellations and this is reflected in these results.
Elite has continued to win new business during the period under review and has
commenced writing lines of non ATE business which it intends to expand within
the next six to twelve months. The Directors are particularly targeting
renewable non ATE business which has the characteristics of premiums being paid
up front.
Litcomp UK
Medico-Legal Reporting
LitComp UK achieved turnover of GBP0.981M, a 13.7% increase over the previous
year. The Directors anticipate continuing improvement in turnover as initiatives
to stimulate business take effect. [LitComp UK broke even during the period
under review].
LitComp Plc 10% Secured Convertible Loan Notes
The GBP2.501M of Loan Notes fell due for redemption on 31 October 2009.
Based on the Company's accessible cash resources, the Company was unable to
redeem the Loan Notes as they fell due on 31 October 2009. Furthermore any
payment of redemption monies out of existing reserves would require Regulatory
consent which could be withheld or subject to conditions either of which would
greatly impact the Company. Therefore the financing for the redemption of the
Loan Notes will not be available from Elite if it wishes to continue trading at
the present level.
The directors believe that the Offer received from Torridon Capital Limited
("Torridon"), of which details appear below, represents the most immediately
available and viable funding for the redemption of the Loan Notes.
Recommended cash offer by Torridon for LitComp Plc
Full details of the Offer are set out in the document "LitComp Notice of General
Meeting.pdf" which can be found on www.litcomp-plc.com/aim.php
The Offer is being made on the following basis:
For each LitComp share - 35p in cash
Those LitComp Loan Note holders who do not exercise their rights to convert Loan
Notes into LitComp shares during the Offer period will receive an equivalent
Offer of GBP1.167 per GBP1 Loan Note and will continue to receive interest
payable by the Company on the Loan Notes up to the date of redemption by the
Company or when purchased by the Offeror.
The Offer values the fully diluted share capital of LitComp at approximately
GBP5.48M and compares to the Closing Price of LitComp shares of 29p on the last
business day immediately prior to the announcement of a firm intention to make
an Offer by Torridon Capital Limited on 5 November 2009.
The Offer is conditional, inter alia, upon the receipt of acceptances in respect
of LitComp shares which together with LitComp shares acquired or agreed to be
acquired before or during the Offer will result in the Offeror holding LitComp
shares carrying not less than 90% (or such lower percentage as the Offeror may
decide, and the Takeover Panel may approve) of the voting rights then normally
exercisable at a General Meeting of LitComp. The Offer was also conditional
inter alia on the approval of the arrangements between the Executive Directors
and the Offeror by the Independent Shareholders at the General Meeting held on
11 December 2009; the Resolution to approve these arrangements was duly passed
at that meeting.
For the avoidance of doubt capitalised terms in this paragraph have the same
meaning as defined in the Offer Document dated 25 November 2009.
Current Trading and Prospects
The Group continues to perform in line with the Directors' expectations. Elite's
ability to maintain growth, particularly through adding new insurance lines to
its portfolio, is dependent on its ability to redeem the Loan Notes, and to
secure further working capital from the Offeror.
A Governmental Review by Sir Rupert Jackson into the Civil Justice Costs process
and possible changes to the conduct of low value road traffic accident cases due
to come into force in May 2010 could impact pricing and volumes of Elite's ATE
business particularly on lower value personal injury and road traffic accident
claims.
Douglas Smith
Non-Executive Chairman
LITCOMP PLC
CONSOLIDATED INCOME STATEMENT
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2009
+------------------------------------+-------------+-------------+------------+
| | 6 months | 6 months | 12 months |
+------------------------------------+-------------+-------------+------------+
| | ended | ended | ended |
+------------------------------------+-------------+-------------+------------+
| | 30-Sep-09 | 30-Sep-08 | 31-Mar-09 |
+------------------------------------+-------------+-------------+------------+
| | (Unaudited) | (Unaudited) | (Audited) |
+------------------------------------+-------------+-------------+------------+
| | GBP'000 | GBP'000 | GBP'000 |
+------------------------------------+-------------+-------------+------------+
| Revenue | | | |
+------------------------------------+-------------+-------------+------------+
| Gross premiums written | 14,939 | 15,755 | 29,519 |
+------------------------------------+-------------+-------------+------------+
| Premiums ceded to reinsurers | -3,165 | -1,679 | -3,753 |
+------------------------------------+-------------+-------------+------------+
| | ______ | ______ | ______ |
+------------------------------------+-------------+-------------+------------+
| Premiums written net of | 11,774 | 14,076 | 25,766 |
| reinsurance | | | |
+------------------------------------+-------------+-------------+------------+
| Fee and commission income | 981 | 868 | 1,802 |
+------------------------------------+-------------+-------------+------------+
| Reinsurance commissions and profit | -301 | 309 | 1,711 |
| participation | | | |
+------------------------------------+-------------+-------------+------------+
| | ______ | ______ | ______ |
+------------------------------------+-------------+-------------+------------+
| TOTAL REVENUE | 12,454 | 15,253 | 29,279 |
+------------------------------------+-------------+-------------+------------+
| | ______ | ______ | ______ |
+------------------------------------+-------------+-------------+------------+
| | | | |
+------------------------------------+-------------+-------------+------------+
| Expenses | | | |
+------------------------------------+-------------+-------------+------------+
| Claims and benefits paid net of | -861 | -1,208 | -3,490 |
| recoveries from reinsurers | | | |
+------------------------------------+-------------+-------------+------------+
| Fee and commission expense | -8,151 | -11,105 | -19,405 |
+------------------------------------+-------------+-------------+------------+
| Corporate expenses - | -2,339 | -1,861 | -3,968 |
| administrative expenses | | | |
+------------------------------------+-------------+-------------+------------+
| Other expenses - restructure of | - | -57 | -115 |
| group debt | | | |
+------------------------------------+-------------+-------------+------------+
| Other expenses - AIM related costs | -32 | -35 | -94 |
+------------------------------------+-------------+-------------+------------+
| Other expenses - share based | - | - | -31 |
| payment charge | | | |
+------------------------------------+-------------+-------------+------------+
| | ______ | ______ | ______ |
+------------------------------------+-------------+-------------+------------+
| TOTAL OPERATING EXPENSES | -11,383 | -14,266 | -27,103 |
+------------------------------------+-------------+-------------+------------+
| | ______ | ______ | ______ |
+------------------------------------+-------------+-------------+------------+
| Operating profit | 1,071 | 987 | 2,176 |
+------------------------------------+-------------+-------------+------------+
| Investment income | 9 | 86 | 135 |
+------------------------------------+-------------+-------------+------------+
| Finance costs | -167 | -196 | -375 |
+------------------------------------+-------------+-------------+------------+
| | ______ | ______ | ______ |
+------------------------------------+-------------+-------------+------------+
| PROFIT BEFORE TAXATION | 913 | 877 | 1,936 |
+------------------------------------+-------------+-------------+------------+
| Taxation | -326 | -309 | -530 |
+------------------------------------+-------------+-------------+------------+
| | ______ | ______ | ______ |
+------------------------------------+-------------+-------------+------------+
| PROFIT FOR THE PERIOD AFTER | 587 | 568 | 1,406 |
| TAXATION | | | |
+------------------------------------+-------------+-------------+------------+
| | ______ | ______ | ______ |
+------------------------------------+-------------+-------------+------------+
| | | | |
+------------------------------------+-------------+-------------+------------+
| Earnings per ordinary share | | | |
| (pence) | | | |
+------------------------------------+-------------+-------------+------------+
| Basic | 9.19 | 9.24 | 22.62 |
+------------------------------------+-------------+-------------+------------+
| Diluted | 3.43 | 3.8 | 9.92 |
+------------------------------------+-------------+-------------+------------+
| | ______ | ______ | ______ |
+------------------------------------+-------------+-------------+------------+
CONTINUING OPERATIONS
None of the group's activities were acquired or discontinued during the current
period or previous period.
TOTAL RECOGNISED GAINS AND LOSSES
The group has no recognised gains or losses other than the profit for the
current period.
LITCOMP PLC
CONSOLIDATED BALANCE SHEET
AS AT 30 SEPTEMBER 2009
+---------------------------------+-------------+-------------+-------------+
| | As at | As at | As at |
+---------------------------------+-------------+-------------+-------------+
| | 30-Sep-09 | 30-Sep-08 | 31-Mar-09 |
+---------------------------------+-------------+-------------+-------------+
| | (Unaudited) | (Unaudited) | (Audited) |
+---------------------------------+-------------+-------------+-------------+
| | GBP'000 | GBP'000 | GBP'000 |
+---------------------------------+-------------+-------------+-------------+
| Non-current assets | | | |
+---------------------------------+-------------+-------------+-------------+
| Goodwill | 482 | 482 | 482 |
+---------------------------------+-------------+-------------+-------------+
| Other intangible assets | - | 1 | - |
+---------------------------------+-------------+-------------+-------------+
| Property, plant and equipment | 63 | 48 | 54 |
+---------------------------------+-------------+-------------+-------------+
| Deferred tax asset | 126 | 122 | 126 |
+---------------------------------+-------------+-------------+-------------+
| | ______ | ______ | ______ |
+---------------------------------+-------------+-------------+-------------+
| TOTAL NON-CURRENT ASSETS | 671 | 653 | 662 |
+---------------------------------+-------------+-------------+-------------+
| | ______ | ______ | ______ |
+---------------------------------+-------------+-------------+-------------+
| Current assets | | | |
+---------------------------------+-------------+-------------+-------------+
| Trade and other receivables | 25,674 | 14,890 | 20,678 |
+---------------------------------+-------------+-------------+-------------+
| Cash and cash equivalents | 2,301 | 3,498 | 3,295 |
+---------------------------------+-------------+-------------+-------------+
| | ______ | ______ | ______ |
+---------------------------------+-------------+-------------+-------------+
| TOTAL CURRENT ASSETS | 27,975 | 18,388 | 23,973 |
+---------------------------------+-------------+-------------+-------------+
| | ______ | ______ | ______ |
+---------------------------------+-------------+-------------+-------------+
| | | | |
+---------------------------------+-------------+-------------+-------------+
| Current liabilities | | | |
+---------------------------------+-------------+-------------+-------------+
| Trade and other payables | -17,451 | -9,825 | -14,376 |
+---------------------------------+-------------+-------------+-------------+
| Current tax liabilities | -3,207 | -2,210 | -2,851 |
+---------------------------------+-------------+-------------+-------------+
| Bank overdraft | -191 | -160 | -194 |
+---------------------------------+-------------+-------------+-------------+
| Obligations under finance | -11 | -2 | -12 |
| leases | | | |
+---------------------------------+-------------+-------------+-------------+
| Financial liabilities - | -2,501 | - | -2,551 |
| borrowings | | | |
+---------------------------------+-------------+-------------+-------------+
| | ______ | ______ | ______ |
+---------------------------------+-------------+-------------+-------------+
| TOTAL CURRENT LIABILITIES | -23,361 | -12,197 | -19,984 |
+---------------------------------+-------------+-------------+-------------+
| | ______ | ______ | ______ |
+---------------------------------+-------------+-------------+-------------+
| NET CURRENT ASSETS | 4,614 | 6,191 | 3,989 |
+---------------------------------+-------------+-------------+-------------+
| | ______ | ______ | ______ |
+---------------------------------+-------------+-------------+-------------+
| TOTAL ASSETS LESS CURRENT | 5,285 | 6,844 | 4,651 |
| LIABILITIES | | | |
+---------------------------------+-------------+-------------+-------------+
| Non-current liabilities | | | |
+---------------------------------+-------------+-------------+-------------+
| Financial liabilities - | - | -3,086 | - |
| borrowings | | | |
+---------------------------------+-------------+-------------+-------------+
| Obligations under finance | -6 | -7 | -9 |
| leases | | | |
+---------------------------------+-------------+-------------+-------------+
| | ______ | ______ | ______ |
+---------------------------------+-------------+-------------+-------------+
| NET ASSETS | 5,279 | 3,751 | 4,642 |
+---------------------------------+-------------+-------------+-------------+
| | ______ | ______ | ______ |
+---------------------------------+-------------+-------------+-------------+
| Equity | | | |
+---------------------------------+-------------+-------------+-------------+
| Share capital | 638 | 614 | 622 |
+---------------------------------+-------------+-------------+-------------+
| Share premium | 1,093 | 1,046 | 1,060 |
+---------------------------------+-------------+-------------+-------------+
| Other reserves (share options) | 432 | 417 | 432 |
+---------------------------------+-------------+-------------+-------------+
| Retained earnings | 3,116 | 1,674 | 2,528 |
+---------------------------------+-------------+-------------+-------------+
| | ______ | ______ | ______ |
+---------------------------------+-------------+-------------+-------------+
| TOTAL EQUITY | 5,279 | 3,751 | 4,642 |
+---------------------------------+-------------+-------------+-------------+
| | ______ | ______ | ______ |
+---------------------------------+-------------+-------------+-------------+
LITCOMP PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2009
+---------------------------------+-------------+---------------+---------------+
| | 6 | 6 months | 12 months |
| | months | | |
+---------------------------------+-------------+---------------+---------------+
| | ended | ended | ended |
+---------------------------------+-------------+---------------+---------------+
| | 30-Sep-09 | 30-Sep-08 | 31-Mar-09 |
+---------------------------------+-------------+---------------+---------------+
| | (Unaudited) | (Unaudited) | (Audited) |
+---------------------------------+-------------+---------------+---------------+
| | GBP'000 | GBP'000 | GBP'000 |
+---------------------------------+-------------+---------------+---------------+
| | | | |
+---------------------------------+-------------+---------------+---------------+
| Opening balance | 4,642 | 3,176 | 3,176 |
+---------------------------------+-------------+---------------+---------------+
| | | | |
+---------------------------------+-------------+---------------+---------------+
| Profit for the financial period | 587 | 568 | 1,406 |
+---------------------------------+-------------+---------------+---------------+
| | | | |
+---------------------------------+-------------+---------------+---------------+
| Share based payments | - | - | 30 |
+---------------------------------+-------------+---------------+---------------+
| | | | |
+---------------------------------+-------------+---------------+---------------+
| Issue of new ordinary shares | 50 | 7 | 30 |
+---------------------------------+-------------+---------------+---------------+
| | ______ | ______ | _______ |
+---------------------------------+-------------+---------------+---------------+
| Closing balance | 5,279 | 3,751 | 4,642 |
+---------------------------------+-------------+---------------+---------------+
| | ______ | ______ | _______ |
+---------------------------------+-------------+---------------+---------------+
LITCOMP PLC
CONSOLIDATED CASH FLOW STATEMENT
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2009
+------------------------------------+-------+-------------+-------------+-----------+
| | | 6 months | 12 months | 6 months |
+------------------------------------+-------+-------------+-------------+-----------+
| | | ended | ended | ended |
+------------------------------------+-------+-------------+-------------+-----------+
| | | 30-Sep-09 | 30-Sep-08 | 31-Mar-09 |
+------------------------------------+-------+-------------+-------------+-----------+
| | | (Unaudited) | (Unaudited) | (Audited) |
+------------------------------------+-------+-------------+-------------+-----------+
| | Notes | GBP'000 | GBP'000 | GBP'000 |
+------------------------------------+-------+-------------+-------------+-----------+
| | | | | |
+------------------------------------+-------+-------------+-------------+-----------+
| Net cash generated from operating | 1 | -865 | 121 | 598 |
| activities | | | | |
+------------------------------------+-------+-------------+-------------+-----------+
| | | ______ | ______ | ______ |
+------------------------------------+-------+-------------+-------------+-----------+
| Investing activities | | | | |
+------------------------------------+-------+-------------+-------------+-----------+
| Interest received | | 9 | 86 | 135 |
+------------------------------------+-------+-------------+-------------+-----------+
| Purchases of property, plant and | | -27 | -15 | -24 |
| equipment | | | | |
+------------------------------------+-------+-------------+-------------+-----------+
| | | _______ | _______ | ______ |
+------------------------------------+-------+-------------+-------------+-----------+
| Net cash generated from investing | | -18 | 71 | 111 |
| activities | | | | |
+------------------------------------+-------+-------------+-------------+-----------+
| | | _______ | _______ | ______ |
+------------------------------------+-------+-------------+-------------+-----------+
| Financing activities | | | | |
+------------------------------------+-------+-------------+-------------+-----------+
| Repayments of finance leases | | -4 | -1 | -6 |
+------------------------------------+-------+-------------+-------------+-----------+
| Issue of new ordinary shares | | - | - | 2 |
+------------------------------------+-------+-------------+-------------+-----------+
| Share premium on issue of ordinary | | - | - | 5 |
| shares | | | | |
+------------------------------------+-------+-------------+-------------+-----------+
| Repayment of 10% secured | | - | - | -578 |
| convertible loan notes | | | | |
+------------------------------------+-------+-------------+-------------+-----------+
| Interest paid | | -103 | -196 | -374 |
+------------------------------------+-------+-------------+-------------+-----------+
| | | _______ | _______ | ______ |
+------------------------------------+-------+-------------+-------------+-----------+
| Net cash (used in) financing | | -107 | -197 | -951 |
| activities | | | | |
+------------------------------------+-------+-------------+-------------+-----------+
| | | _______ | _______ | ______ |
+------------------------------------+-------+-------------+-------------+-----------+
| | | | | |
+------------------------------------+-------+-------------+-------------+-----------+
| Net increase/(decrease) in cash | | 990 | -5 | -242 |
| and cash equivalents | | | | |
+------------------------------------+-------+-------------+-------------+-----------+
| | | | | |
+------------------------------------+-------+-------------+-------------+-----------+
| Cash and cash equivalents at the | | 3,101 | 3,343 | 3,343 |
| beginning of the period | | | | |
+------------------------------------+-------+-------------+-------------+-----------+
| | | _______ | _______ | ______ |
+------------------------------------+-------+-------------+-------------+-----------+
| Cash and cash equivalents at end | | 2,111 | 3,338 | 3,101 |
| of the period | | | | |
+------------------------------------+-------+-------------+-------------+-----------+
| | | _______ | _______ | ______ |
+------------------------------------+-------+-------------+-------------+-----------+
| | | | | |
+------------------------------------+-------+-------------+-------------+-----------+
| Consisting of: | | | | |
+------------------------------------+-------+-------------+-------------+-----------+
| Cash at bank and in hand | | 1,232 | 2,120 | 1,334 |
+------------------------------------+-------+-------------+-------------+-----------+
| Units in unit trusts | | 1,070 | 1,378 | 1,961 |
+------------------------------------+-------+-------------+-------------+-----------+
| Bank overdrafts | | -191 | -160 | -194 |
+------------------------------------+-------+-------------+-------------+-----------+
| | | _______ | _______ | _______ |
+------------------------------------+-------+-------------+-------------+-----------+
| | | 2,111 | 3,338 | 3,101 |
+------------------------------------+-------+-------------+-------------+-----------+
| | | _______ | _______ | _______ |
+------------------------------------+-------+-------------+-------------+-----------+
1.Reconciliation of operating profit to net cash from operating activities
+---------------------------------+-------------+-------------+-------------+
| | 6 months | 6 months | 12 months |
+---------------------------------+-------------+-------------+-------------+
| | ended | ended | ended |
+---------------------------------+-------------+-------------+-------------+
| | 30-Sep-09 | 30-Sep-08 | 31-Mar-09 |
+---------------------------------+-------------+-------------+-------------+
| | (Unaudited) | (Unaudited) | (Audited) |
+---------------------------------+-------------+-------------+-------------+
| | GBP'000 | GBP'000 | GBP'000 |
+---------------------------------+-------------+-------------+-------------+
| | | | |
+---------------------------------+-------------+-------------+-------------+
| Operating profit for the period | 913 | 877 | 1,936 |
+---------------------------------+-------------+-------------+-------------+
| Adjustments for: | | | |
+---------------------------------+-------------+-------------+-------------+
| Depreciation of property, plant | 19 | 12 | 31 |
| and equipment | | | |
+---------------------------------+-------------+-------------+-------------+
| Amortisation of intangible | - | 1 | 1 |
| assets | | | |
+---------------------------------+-------------+-------------+-------------+
| Restructure of group debt | - | 57 | 115 |
+---------------------------------+-------------+-------------+-------------+
| Share based payments | - | - | 31 |
+---------------------------------+-------------+-------------+-------------+
| Finance costs | 167 | 196 | 375 |
+---------------------------------+-------------+-------------+-------------+
| Investment revenues | -10 | -86 | -135 |
+---------------------------------+-------------+-------------+-------------+
| | ______ | _______ | ______ |
+---------------------------------+-------------+-------------+-------------+
| Operating cash flows before | | | |
| movements in | | | |
+---------------------------------+-------------+-------------+-------------+
| working capital | 1,089 | 1,057 | 2,354 |
+---------------------------------+-------------+-------------+-------------+
| (Increase) in receivables | -4,995 | -4,565 | -10,354 |
+---------------------------------+-------------+-------------+-------------+
| Increase in payables | 3,426 | 3,866 | 8,836 |
+---------------------------------+-------------+-------------+-------------+
| | ______ | _______ | ______ |
+---------------------------------+-------------+-------------+-------------+
| Cash generated from operations | -480 | 358 | 836 |
+---------------------------------+-------------+-------------+-------------+
| Tax paid | -385 | -237 | -238 |
+---------------------------------+-------------+-------------+-------------+
| | _______ | _______ | ______ |
+---------------------------------+-------------+-------------+-------------+
| Net cash generated from | -865 | 121 | 598 |
| operating activities | | | |
+---------------------------------+-------------+-------------+-------------+
| | _______ | _______ | ______ |
+---------------------------------+-------------+-------------+-------------+
LITCOMP PLC
NOTES TO THE ANNOUNCEMENT
1. Publication of non Statutory Accounts
The financial information set out in this announcement for the six months ended
30 September 2009 and 2008 does not constitute statutory accounts within the
meaning of Section 434 of the Companies Act 2006.
The figures for the year ended 31 March 2009 have been extracted from the
group's statutory report and financial statements.
The auditor's report on the statutory report and financial statements for the
year ended 31 March 2009 was modified on the basis of an emphasis of matter
opinion in relation to the going concern of the group.
The statutory report and financial statements for the year ended 31 March 2009
has been delivered to the Registrar of Companies.
2. Basis of preparation
The results for the six months ended 30 September 2009 have been prepared in
accordance with International Accounting Standard Board ("IASB") and
interpretations issued by the International Financial Reporting Interpretations
Committee of the IASB (together with "IFRS") as endorsed by the European Union
in 2005, and prepared in accordance with IAS 34, Interim Financial Reporting.
The statutory report and financial statements for the year ended 31 March 2009
has been prepared in accordance with IFRSs.
3. Accounting policies
There has been no change in accounting policies since the end of the last
financial year end and have all been consistently applied throughout the
accounting period six months ended 30 September 2009.
4. Functional currency
The results are presented in pound sterling as that is the currency of the
primary economic environment in which the group operates.
5. Comparatives
The comparatives include audited figures for the year ended 31 March 2009 and
un-audited figures for the six months ended 30 September 2008.
LITCOMP PLC
NOTES TO THE ANNOUNCEMENT (CONTINUED)
6.Segmental information
"Ins" represents the results of the ATE Insurance business whilst "Reports"
comprises the provision of Medico-Legal reports and litigation services.
All income is generated within the United Kingdom albeit the insurance policies
are underwritten in Gibraltar.
Trading statement
+-----------------------+---------+---------+---------+---------+---------+---------+
| | 6 months to 30 Sept 2009 | 6 months to 30 Sept 2008 |
| | (unaudited) | (unaudited) |
+-----------------------+-----------------------------+-----------------------------+
| | Ins | Reports | Total | Ins | Reports | Total |
+-----------------------+---------+---------+---------+---------+---------+---------+
| |GBP'000 |GBP'000 |GBP'000 |GBP'000 |GBP'000 |GBP'000 |
+-----------------------+---------+---------+---------+---------+---------+---------+
| Segmental income | 11,473 | 981 | 12,454 | 14,472 | 868 | 15,340 |
+-----------------------+---------+---------+---------+---------+---------+---------+
| | ______ | ______ | ______ | ______ | ______ | ______ |
+-----------------------+---------+---------+---------+---------+---------+---------+
| Trading profit/(loss) | 900 | 173 | 1,073 | 1,484 | -414 | 1,070 |
+-----------------------+---------+---------+---------+---------+---------+---------+
| AIM related costs | - | -32 | -32 | - | -35 | -35 |
+-----------------------+---------+---------+---------+---------+---------+---------+
| Loan note interest | - | -128 | -128 | - | -158 | -158 |
+-----------------------+---------+---------+---------+---------+---------+---------+
| | ______ | ______ | ______ | ______ | ______ | ______ |
+-----------------------+---------+---------+---------+---------+---------+---------+
| Profit/(loss) before | 900 | 13 | 913 | 1,484 | -607 | 877 |
| tax | | | | | | |
+-----------------------+---------+---------+---------+---------+---------+---------+
| Tax (charge)/credit | -282 | -44 | -326 | -411 | 102 | -309 |
+-----------------------+---------+---------+---------+---------+---------+---------+
| | ______ | ______ | ______ | ______ | ______ | ______ |
+-----------------------+---------+---------+---------+---------+---------+---------+
| Profit/(loss) after | 618 | -31 | 587 | 1,073 | -505 | 568 |
| tax | | | | | | |
+-----------------------+---------+---------+---------+---------+---------+---------+
| | ______ | ______ | ______ | ______ | ______ | ______ |
+-----------------------+---------+---------+---------+---------+---------+---------+
| Balance Sheet | | | | | | |
+-----------------------+---------+---------+---------+---------+---------+---------+
| | At 30 Sept 2009 | At 31 March 2009 |
| | (Unaudited) | (Audited) |
+-----------------------+-----------------------------+-----------------------------+
| | Ins | Reports | Total | Ins | Reports | Total |
+-----------------------+---------+---------+---------+---------+---------+---------+
| |GBP'000 |GBP'000 |GBP'000 |GBP'000 |GBP'000 |GBP'000 |
+-----------------------+---------+---------+---------+---------+---------+---------+
| Goodwill | - | 482 | 482 | - | 482 | 482 |
+-----------------------+---------+---------+---------+---------+---------+---------+
| Property, plant & | 44 | 19 | 63 | 28 | 26 | 54 |
| equipment | | | | | | |
+-----------------------+---------+---------+---------+---------+---------+---------+
| Deferred tax asset | - | 126 | 126 | - | 126 | 126 |
+-----------------------+---------+---------+---------+---------+---------+---------+
| Trade & other | 22,985 | 2,688 | 25,673 | 19,486 | 1,192 | 20,678 |
| receivables | | | | | | |
+-----------------------+---------+---------+---------+---------+---------+---------+
| Cash & cash | 1,487 | 815 | 2,302 | 2,590 | 705 | 3,295 |
| equivalents | | | | | | |
+-----------------------+---------+---------+---------+---------+---------+---------+
| | ______ | ______ | ______ | ______ | ______ | ______ |
+-----------------------+---------+---------+---------+---------+---------+---------+
| Total assets | 24,516 | 4,130 | 28,646 | 22,104 | 2,531 | 24,635 |
+-----------------------+---------+---------+---------+---------+---------+---------+
| | ______ | ______ | ______ | ______ | ______ | ______ |
+-----------------------+---------+---------+---------+---------+---------+---------+
| Trade and other | -15,118 | -2,333 | -17,451 | -12,645 | -1,731 | -14,376 |
| payables | | | | | | |
+-----------------------+---------+---------+---------+---------+---------+---------+
| Tax liabilities | -2,291 | -916 | -3,207 | -1,640 | -1,211 | -2,851 |
+-----------------------+---------+---------+---------+---------+---------+---------+
| Financial borrowings | - | -2,692 | -2,692 | - | -2,745 | -2,745 |
+-----------------------+---------+---------+---------+---------+---------+---------+
| Other liabilities | - | -17 | -17 | - | -21 | -21 |
+-----------------------+---------+---------+---------+---------+---------+---------+
| | _______ | _______ | _______ | _______ | _______ | _______ |
+-----------------------+---------+---------+---------+---------+---------+---------+
| Total liabilities | -17,409 | -5,958 | -23,367 | -14,285 | -5,708 | -19,993 |
+-----------------------+---------+---------+---------+---------+---------+---------+
| | _______ | _______ | _______ | _______ | _______ | _______ |
+-----------------------+---------+---------+---------+---------+---------+---------+
| Net | 7,107 | -1,828 | 5,279 | 7,819 | -3,177 | 4,642 |
| assets/(liabilities) | | | | | | |
+-----------------------+---------+---------+---------+---------+---------+---------+
| | _______ | _______ | _______ | _______ | _______ | _______ |
+-----------------------+---------+---------+---------+---------+---------+---------+
LITCOMP PLC
NOTES TO THE ANNOUNCEMENT (CONTINUED)
7. Earnings per ordinary share
Basic earnings per ordinary share is calculated on earnings of GBP586,658 (30
September 2008: GBP567,921) for the period and on 6,384,327 (30 September 2008:
6,144,345) being the weighted average number of shares in issue during the
period.
Fully diluted earnings per ordinary share is calculated on earnings for the
period adjusted for convertible loan note interest and on 17,103,267 (30
September 2008: 19,119,952) being the potential weighted average number of
shares.
8. 10% secured convertible loan notes
On 21 November 2005 the company issued GBP3.605m convertible loan notes of which
GBP2.501m were outstanding at 30 September 2009. Interest is payable in
quarterly installments at a coupon rate of 10% per annum.
The loan notes are convertible into equity shares by the loan note holders and
if not converted these loan notes are redeemable at par at the end of their
term. For each GBP1 of loan note converted 3.3 ordinary shares of GBP0.10 each
would be issued.
On 10 December 2008 the loan note term was extended by one year until 31 October
2009 to the extent which they have not been converted. The loan notes are
secured over the assets of the group.
9. Post Balance Sheet Events
Further to the announcement on 24 September 2009 that the directors were in
advanced discussions regarding a possible offer for the company, on 5 November
2009 the independent directors of Litcomp Plc reached an agreement on the terms
of a recommended cash offer made by Torridon Capital Limited for the entire
issued and to be issued share capital of Litcomp Plc. Accordingly, the directors
of Litcomp Plc draw your attention to the Recommended Cash Offer by Torridon
Capital Limited document, dated (5 November 2009), on the company's website at
www.litcomp-plc.com.
10. Going Concern
Subject to the recommended cash offer by Torridon Capital Limited being accepted
by the majority we draw your attention to the following:
There are currently GBP2.501m of 10% secured convertible loan notes outstanding
as at 30 September 2009 and which, if not converted to equity, would require
repayment. This condition indicates the existence of a material uncertainty
which may cast significant doubt on the company and group's ability to continue
as a going concern. The financial information presented in this announcement
does not include adjustments that would result if the company and group were
unable to continue as a going concern as it is not practical to determine or
quantify them.
11. Availability of Interim Results
The Interim Results are available on the Company's website at
www.litcomp-plc.com.
12. Date of approval of this announcement
This Announcement was approved by the Directors on 18 December 2009
INDEPENDENT REVIEW REPORT TO LITCOMP PLC
Introduction
We have been engaged by the company to review the condensed set of financial
statements in the half-yearly financial report for the six months ended 30
September 2009 which comprises the consolidated income statement, the
consolidated statement of changes in equity and consolidated cash flow statement
and the consolidated balance sheet as at 30 September 2009 and a summary of
significant accounting policies and other explanatory notes. We have read
the other information contained in the half-yearly financial report and
considered whether it contains any apparent misstatements or material
inconsistencies with the information in the condensed set of financial
statements.
Directors' Responsibilities
The half-yearly financial report is the responsibility of, and has been approved
by, the directors. The directors are responsible for preparing the half-yearly
financial report in accordance with the AIM Rules For Companies.
As disclosed in note 2, the statutory report and financial statements of the
group are prepared in accordance with IFRSs as adopted by the European Union.
The condensed set of financial statements included in this half-yearly financial
report has been prepared in accordance with International Accounting Standard
34, Interim Financial Reporting, as adopted by the European Union.
Our Responsibility
Our responsibility is to express to the Company a conclusion on the condensed
set of financial statements in the half-yearly financial report based on our
review.
Scope of review
We conducted our review in accordance with International Standard on Review
Engagements (UK and Ireland) 2410, Review of Interim Financial Information
Performed by the Independent Auditor of the Entity, issued by the Auditing
Practices Board for use in the United Kingdom. A review of interim financial
information consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other review
procedures. A review is substantially less in scope that an audit conducted in
accordance with International Standards on Auditing (UK and Ireland) and
consequently does not enable us to obtain assurance that we would become aware
of all significant matters that might be identified in an audit. Accordingly, we
do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe
that the condensed set of financial statements in the half-yearly financial
report for the six months ended 30 September 2009 is not prepared, in all
material respects, in accordance with International Accounting Standard 34 as
adopted by the European Union and the AIM Rules For Companies.
UHY Hacker Young LLP
This information is provided by RNS
The company news service from the London Stock Exchange
END
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