TIDMKURA
RNS Number : 7748N
Kurawood PLC
24 February 2009
Kurawood Plc ("Kurawood" or the "Company")
Preliminary Results for the twelve months ended 30 September 2008
OVERVIEW
This year has been, by necessity, one of consolidation and foundation laying
against a backdrop of general uncertainty that pervades the UK economy. In
particular, customers in the construction and building materials sectors have
been unwilling to commit forward, creating a testing business environment for
Kurawood.
Summary financial results
* Operating loss for the period was GBP6,536,721 including exceptional items
of GBP5,105,193 arising largely from a write-down of Goodwill (2007: operating
net loss of GBP5,477,094 including exceptional items of GBP5,144,018);
* Net assets of the Group of GBP409,980 (2007: GBP7,250,489 restated) are
down on the prior year largely due to the write down of the net assets and
goodwill associated with PG Industries Limited.
* Cash of GBP94,471 at the period end, (2007: GBP2,953,040) which includes
the discharge of the Group's liabilities to Barclays by repaying the GBP2
million term loan outstanding in the prior year; and
* The Company has not generated revenues from product sales since Admission
and the Directors believe that, due to the likelihood of a protracted global
recession and continued unwillingness of customers to commit to purchase
products, this position is unlikely to change in the foreseeable future.
Strategy and Achievements
Although the Company successfully completed an enlarged Vecowood manufacturing
facility moving from 5,000 to 300,000 cubic metres of nameplate capacity at a
total capital expenditure of GBP570,770 during the period (2007: GBP3,714),
equating to GBP1.90 per cubic metre of nameplate capacity, the cost of New
Zealand Radiata Pine (the raw material used in the manufacture of Vecowood ) is
now trading at approximately twice the price of similar Radiata Pine grown
outside of New Zealand whilst the export prices of other timber species to major
Asian markets have collapsed, in some instances by up to 50 per cent. The
Directors believe that these recent adverse movements in global market
conditions means a manufacturing facility operating from New Zealand is no
longer economically viable in the medium term.
There has therefore been a change of strategy for the Company to focus more
heavily on international licensing opportunities with manufacturers and large
end-users. The Directors believe that this business model should allow Kurawood
to better exploit its wood modification technology since ownership of registered
intellectual property rights ("IPR") provides a certain degree of exclusivity
and, thereby, a higher market share as and when the Company's products prove
successful among consumers. As such the Directors place an increasing reliance
on Kurawood's IPR assets as a source of competitive advantage for the
businesses. The Company uses Harrison Goddard Foote (www.hgfip.com) to ensure
its intellectual property is sufficiently protected;
The Company has also achieved the following:
* Patent protection for Vecowood provided in the first instance by a UK
national patent that seeks to protect the ability of our modified timber to be
commercially powder coated. This national patent, granted on the 9th December
2008, also forms the basis of an International (PCT) patent application;
* A second UK national patent application has since been filed to further
protect the Veco formulation and the method of manufacture of Vecowood that on
publication will also form the basis of further PCT applications;
* Introduction of a second modified wood product, "AcetowoodTM", founded on
the companies' own process based on the acetylating of wood. AcetowoodTM is a
modified timber suitable for in-ground applications and therefore compliments
Vecowood , a modified timber more suited to above ground and interior appearance
grade applications. Further protection is being sought for AcetowoodTM via a
national patent application;
* With international patents and patent applications in place, a
complimentary licensing model is being implemented, allowing the Group to
concentrate its capital resources on technology and brand development, with
licensees providing capital for marketing and product penetration;
* Further funding has been secured, subject to shareholder approval, and is
to be provided by the Chairman, through Fox Capital Limited, as detailed in the
accompanying circular to shareholders;
* In Vecowood we have a timber ideally suited to above-ground external and
internal appearance grade applications being offered for sale at highly
competitive prices when compared to other modified timbers and premium
hardwoods. It is, we believe, the only sold wood, whether modified or naturally
grown, capable of being commercially powder coated and a patent has been
published to protect the same. Furthermore, the right to Vecowood 's method of
manufacture may also now be securely licensed to independent 3rd parties
anywhere located on significantly more financially attractive terms than other
technology providers operating in this arena, this being possible due to the
comparatively low required capital expenditure of circa GBP2.00 per cubic metre
of installed capacity; and
* In AcetowoodTM, we have a timber ideally suited to in-ground external
applications offered for sale also at competitive prices. The Directors are also
confident that the method of manufacture of AcetowoodTM will soon be capable of
being securely licensed again on extremely competitive terms with a required
capital expenditure in the region of GBP3.00 to GBP4.00 per cubic metre of
installed capacity.
Emphasis of Matter in relation to going concern
The audit report, which is not qualified, includes an emphasis of matter in
relation to going concern. The auditors have indicated the following: "we note
that the Company is intending to raise finance of GBP200,000 by way of equity,
which is essential to support the funding requirements for the period until
February 2010, and has agreements in place to achieve this, subject to
shareholder approval. Accordingly the directors have prepared these financial
statements on the going concern basis. This funding is considerably below
funding requirements for the year reported on in these accounts and reflects the
changes the directors have made to the operations of the business, in particular
the shutting down of the New Zealand subsidiary and the cessation of capital
investment. We draw your attention to the disclosures made in Post Balance Sheet
Events noting the existence of uncertainty in costs of cessation of the New
Zealand subsidiary and in potential legal costs. These uncertainties could have
a significant effect on the availability of funds for the Company."
Enquiries:
Justin Martin, Kurawood plc Tel: 01624 820040
Ross Andrews, Zeus Capital Limited Tel: 0161 831 1512
Tom Rowley, Zeus Capital Limited
Ruari McGirr, St Helen's Capital plc Tel: 020 7628 5582
Mark Anwyl, St Helen's Capital plc
CHAIRMAN AND CHIEF EXECUTIVE'S REPORT
I have pleasure presenting the Company's first annual report since its admission
to AIM in September 2007 and take the opportunity to thank our employees and
shareholders for their support during this period. This year has been, by
necessity, one of consolidation and foundation laying against a backdrop of
general uncertainty that pervades the UK economy. In particular, customers in
the construction and building materials sectors are unwilling to commit forward,
creating a testing business environment for Kurawood.
OVERVIEW
The Company's initial objectives were to increase the installed production
capacity at its manufacturing facility at Aviation Avenue, Tauranga in New
Zealand and to focus on developing retail sales of finished Vecowood products,
the organically modified timber manufactured through the Company's proprietary
Veco formulation and process, predominantly to UK based wholesalers and
retailers.
However, despite securing purchase orders from a leading retailer and having had
a number of approaches from interested parties, the Company has had to turn away
unprofitable business whilst a number of interested parties have subsequently
become unwilling to commit to forward purchases as their own sales became
affected in the general market demise. As such the Company has not generated
revenues during the period and in an effort to reduce expenditure, the Directors
have resolved that the Company's New Zealand subsidiary PG Industries Limited
should cease trading.
For the year ended 30 September 2008, the operating loss was
GBP6,536,721 including exceptional costs of GBP5,105,193 of which the largest
item was GBP4,660,675 arising from a write-off of Goodwill (2007: operating net
loss of GBP5,477,094 including exceptional items of GBP5,144,018). This change
in the treatment of Goodwill has resulted in a fall in the Group's Net assets,
which, at the period end, were GBP409,980 (2007: GBP7,250,489). During the
period the Company discharged its liabilities to Barclays Bank Plc by repaying
the GBP2 million term loan outstanding. Cash at the period end was GBP94,471.
Due to the possibility of a protracted UK recession and continued unwillingness
of customers to commit to purchases, the Company undertook a review of its
ongoing business opportunities and expenditure requirements resulting in an
announcement in September that the Board agreed, amongst other cost saving
actions, (a) to defer all Board salary payments and (b) that the Chairman,
through Fox Capital Limited, the Company's largest shareholder would provide a
GBP100,000 convertible loan facility (of which GBP100,000 had been drawn down as
at the date of this document) and had agreed, subject to shareholder approval,
to subscribe for GBP400,000 of additional equity. With the cessation of trading
of the subsidiary, some GBP195,000 of future overheads has been removed from the
Group's working capital requirements and as such the additional equity
requirement has been reduced to GBP200,000. Accompanying the report and accounts
is a circular to shareholders giving full details of the conversion of the loan
and the subscription by Fox Capital Limited to meet this additional GBP200,000
equity requirement together with details of a General Meeting of shareholders to
approve these proposals. In making their assessment the directors have
considered the period up to February 2010.
With a mechanism to secure further funding concluded, the Board also agreed to
change the strategy of the Group to focus more heavily on international
license-based opportunities with manufacturers and large end-users as evidenced
by the signing of an agency agreement with Matrex Global Limited, a specialist
marketer of forestry products, principally operating in Asia: a market less
affected by the underlying economic concerns than in Europe and North America.
PRINCIPAL ACTIVITY
The principal activity of the Group is the development and commercialisation of
its proprietary Veco formulation and process for the manufacture of Vecowood
branded organically modified softwood. Vecowood is currently only manufactured
from New Zealand Radiata Pine, a resource supplied entirely from Forestry
Stewardship Council, ("FSC"), certified fast-growing plantation forests,
planted, managed, and harvested with little environmental consequence. Since the
practise of 'pruning' and 'thinning' is widely used in New Zealand, the logs,
when sawn and treated with our Veco formulation, produce long wide planks of
clear, defect free Vecowood timber, similar in appearance and physical
properties to those once able to be sourced from huge hardwood specimens.
Vecowoodhas been extensively tested by New Zealand's leading wood institute for
hardness, density, bending strength and dimensional stability, machine-ability
and powder coating retention to ensure optimal performance in above-ground
conditions. Of significant importance are the results of long term swelling
tests based on the British Building Research Establishment standard for
determining the movement of timber that have shown that Vecowoodeasily performs
to Class 1 specifications for dimensional stability alongside species such as
Teak, Obeche and Iroko, (unmodified Radiata Pine, Ash, Mahogany, Jarrah and Oak
are all examples of wood species with lesser Class 2 stability whilst European
Beech, Karri and Black wood are all Class 3). These dimensional stability
results further extend the impressive hardness, density and bending strength
credentials of Vecowood .
Vecowood should therefore, we believe, be the material of choice for many
appearance grade internal applications (for instance kitchen and bathroom
cabinetry, flooring and other internal joinery) and above-ground external
applications such as window frames, conservatory frames and doors. Not only does
Vecowood have extremely low thermal conductivity but it is also more
dimensionally stable than many of the best tropical hardwoods. Vecowood is also
the first and only solid wood product that is capable of accepting a smooth,
defect free factory applied powder coated finish, both opaque (in a virtually
unlimited colour spectrum) or, for those wishing to enjoy the natural look of
wood, transparent coated. The upshot of this is that a window, conservatory or
door manufacturer can now offer their customers the benefit of a powder coated
finish on the outside which ensures a long-lasting, weatherproof and easily
maintained surface - it only needs to be cleaned - whilst on the inside,
Vecowood may also be powder coated or left exposed, giving an excellent
interior timber finish. With respect to internal applications such as
cabinetry, a powder coated finish should be considered superior to the more
traditional spray finishes that are currently available for the same reasons of
enhanced durability and ease of maintenance.
This ability to be powder coated adds to (i) Vecowood 's attractiveness as it is
cheaper and in more regular supply than most hardwoods and other modified
timbers, (ii) reduced frequency and cost of maintenance - a critical factor in
determining the choice of material that is used, and (iii) its enhanced
environmental credentials as Vecowood is only made from sustainable FSC
certified timber and powder coating is already widely regarded as the most
environmentally compliant finish.
The Company's range of products has been enhanced by the introduction of a
second wood modification technology in the more established acetylated timber
arena. Trademarked "Acetowood", it is a modified timber suitable for in-ground
applications and therefore compliments Vecowood . AcetowoodTM is also
manufactured from the same Forestry Stewardship Council certified fast-growing
New Zealand Radiata Pine. Preliminary trials carried out on AcetowoodTM confirm
superior hardness scores to other available acetylated timbers with further
tests on dimensional stability and durability ongoing.
MANUFACTURING CAPACITY
As the Company has not generated revenues from product sales during the period
and in an effort to reduce expenditure, the Directors resolved that the
Company's New Zealand subsidiary PG Industries Limited should cease trading. The
Directors are seeking legal advice as to the most pragmatic route to give full
force and effect of this resolution. This decision was reached on the basis that
a manufacturing facility operating from New Zealand is no longer economically
viable, given recent adverse movements in global market conditions, and that
this situation is unlikely to change favourably in the medium term.
This plant consists of two impregnation vessels each with an annual nameplate
capacity of 150,000m3 and it is anticipated that one or both of these vessels
and accompanying plant and equipment may be offered to early technology adopters
under a license-based business model.
The decision to cease trading was made despite PG Industries Limited becoming
certified for Forest Stewardship Council, ("FSC") Chain-of-Custody (Certificate
Registration Code: SW-COC-003655) on the 25th November 2008. As such, PG
Industries Limited, or a potential licensee, operating to the working practices
established by the subsidiary would be allowed to label products with the FSC
trademarks. The FSC label provides the link between responsible production and
consumption and thereby enables the consumer to make socially and
environmentally responsible purchasing decisions.
FSC Chain-of-Custody certification demonstrates that the holder takes the
environmental concerns of our customers and staff seriously. Furthermore,
Chain-of-Custody certification can be used to demonstrate compliance with public
or private procurement policies and specifications such as the European Union's
Ecolabel scheme for furniture, or the U.S. Green Building Leadership in Energy
and Environmental Design (LEED) rating system.
INTELLECTUAL PROPERTY RIGHTS ("IPR")
For both the Vecowood and AcetowoodTM technologies, the Directors have sought
patent protection in the first instance by a UK National Patent followed closely
by International Patent Cooperation Treaty (PCT) patent applications. These
international PCT applications may be further refined as and when national phase
filings draw near.
On the 9th December 2008, the Company was granted its first UK patent, (Patent
Serial Number: GB 2445220), to protect the ability of Vecowood and any modified
non-engineered softwood to be powder coated. Natural timber, from a species such
as pine, when impregnated with Kurawood's proprietary Veco formulation, imparts
certain properties to the resultant Vecowoodwhich improve the ability of the
powder coating to adhere to its surface and avoids other common problems
experienced which have historically precluded solid wood from being considered
suitable for powder coating finishes. The filing of an international application
according to the Patent Cooperation Treaty based on this UK patent was made to
the UK Intellectual Property Office on the 26th September 2008.
For the Group, this international patent application has the effect of national
patent applications in those PCT Contracting States which we have "designated"
in the application and has the effect of regional patent applications in those
PCT Contracting States, which are also party to a regional patent treaty such as
the African Regional Intellectual Property Organisation (ARIPO) Harare Protocol,
the Eurasian Patent Convention, the European Patent Convention and the OAPI
(African Intellectual Property Organisation) Agreement.
A second UK National Patent Application was filed on the 23rd October 2008 to
further protect the Veco formulation and the method of manufacture of
Vecowoodand further patent filings are in process to better protect the
company's AcetowoodTM product and its method of manufacture.
Clear IPR ownership is important to the Directors as it enables the Company to
adopt an international licensing strategy to complement other market
opportunities for the commercialisation of Vecowood and AcetowoodTM. Ownership
of IPR guarantees a certain degree of exclusivity and, thereby, a higher market
share as and when our products prove successful among consumers. As such the
Directors place an increasing reliance on the Groups IPR assets as a source of
competitive advantage for the businesses. The Group uses Harrison Goddard Foote
(www.hgfip.com) to ensure its intellectual property is sufficiently protected.
SALES AND MARKETING
The Directors consider the best way to maximise profits over the long term is to
concentrate on securing long term licensing partnerships with volume consumers
as opposed to smaller one-off or irregular transactions. As such the Group has
adopted an open-book, full-cost pricing approach to encourage potential
customers to jointly examine the full costs of producing goods from Vecowood
and to price them at an appropriate margin to the long-term mutual benefit of
both customer and Kurawood.
Retail Sales
During the year, the Company initially focused on achieving retail sales of
finished products manufactured in Vecowood to predominantly UK based
wholesalers and retailers of products like flooring, skirting, dado and
architraves. Despite significant market interest from a number of established
retail names, the rapid deterioration in the UK economy put significant pressure
on trading margins and as such no sales have been completed.
Agents and Introducers
The Company entered into an agency agreement with Hong Kong based Matrex Global
Ltd. Matrex, acting in their capacity as a fully commissioned agent, has
undertaken to market and promote Vecowood to manufacturers and end-user
customers located in the territories of China, Japan, Korea, Taiwan, Vietnam and
Australia initially as a product and latterly as a licensing opportunity. The
Directors expect to enter into other Agency and Introducer Agreements over the
coming period with a focus on securing license-based opportunities for the
Group.
Licensing
The Directors believe that the adoption of a licence-based business model should
allow the Group to exploit both of its wood modification technologies by
allowing the Group to concentrate its limited capital on technology and brand
development, while licensees provide capital for marketing and product
penetration. This decentralised approach also provides a cost-effective solution
to the timber industry's complex and fragmented distribution channels.
Technology licensing will initially be aimed at major timber processors, with
additional sales efforts being aimed at timber producers and coatings
manufacturers in order to gain market acceptance of the technology. The
licensing model is based on two revenue streams:
* a manufacturing licence fee - predicated on a licence payment per m3 of
nameplate capacity, a percentage of which will be paid on signing of the licence
and the balance over the lifetime of the license. In marked contrast to our
competitors, the manufacturing license fee includes the capital expenditure and
commissioning costs of the licensee's facility, which the Group will bear; and
* an ongoing production royalty - predicated on quarterly production output
from the licensee's facility.
Both manufacturing license fees and ongoing production royalties are positioned
to be at a significant discount to the cost of competitive offerings.
The Group's licensing revenues would be driven directly by the size and timing
of new licence agreements, which may lead to early volatility in income. Once
established, licence and royalty fees should provide considerable forward
visibility for the Group.
Prospects
The circular, which will be announced today, contains a notice of meeting
seeking shareholders' approval for certain proposals, which, if approved, will
result in a cash injection of GBP200,000 by way of equity. This will provide the
Company with sufficient working capital for its current requirements, being for
at least the period to February 2010 with no adverse effect on the Company's
liabilities. If these proposals are not approved then the Company will not have
sufficient cash for this period and the Directors will need to explore
alternative sources of finance.
The additional funds will provide the Board with the opportunity to concentrate
on entering into technology licenses introduced to the Group via our preferred
Agents, Introducers and re-manufacturers.
Conclusion
It has been a pleasure to serve as your Chairman and Chief Executive Officer
during the past year and I am confident that we can be tremendously successful
with the foundations that we have built.
Roy Tilleard
Chairman and Chief Executive
23 February 2009
FINANCE REPORT
Operating result
The Group continues to be subject to the difficult economic environment in the
UK. For the year ended 30 September 2008, the operating loss was GBP6,536,721
including total exceptional items of GBP5,105,193 arising largely from a
write-down of Goodwill of GBP4,660,675 and the full write down of the assets of
the subsidiary PG Industries Limited of GBP628,983 following the decision for
this company to cease trading with immediate effect (2007: operating net loss of
GBP5,477,094 including exceptional items of GBP5,144,018).
Financial expenses of GBP187,520 (2007: GBP129,311) arising from bank loans have
been offset by interest received of GBP123,978 (2007: GBP9,573) largely from
cash on deposit.
Net assets
The net assets of the Group of GBP409,980 (2007: GBP7,250,489 restated) are down
on the prior year largely due the write-down of the assets and goodwill
associated with PG Industries Limited.
Net cash
Net cash including cash deposits at 30 September 2008 was GBP94,471 down from
GBP4,953,040 in the prior year due to revenue related expenditures and capital
expenditure of GBP507,770 (2007: nil). The Company has discharged its
liabilities to Barclays by repaying the GBP2 million term loan outstanding in
the prior year. Other net cash out flows of GBP2,858,438 were in respect of
operating expenditures.
In order to secure the Group's ability to finance future trading activity, a
GBP100,000 unsecured loan facility (the "Loan") was arranged on 22 September
2008 with Fox Capital (a company controlled by Roy Tilleard).
The Loan carries an interest rate of 6% above the Bank of England Base Rate, and
may be drawn down as required by the Company. Upon fulfilment of certain
conditions, the Loan is convertible into ordinary shares. This funding, together
with the further equity subscription of GBP200,000 proposed, should enable the
Company to continue to trade through to the following financial year without the
need for external financing. In making their assessment the directors have
considered the period up to February 2010.
On this basis, there is sufficient working capital in place to carry the
business through the coming financial year which will leave us well placed to
take advantage of the improvement in market conditions thereafter.
Justin Martin
Chief Financial Officer
23 February 2009
CONSOLIDATED INCOME STATEMENT FOR THE 12 MONTHS ENDED 30 SEPTEMBER 2008
+----------------------------------------------------+--+---------------+---------------+
| | | GROUP |
+----------------------------------------------------+--+-------------------------------+
| | | 2008 | 2007 |
+----------------------------------------------------+--+---------------+---------------+
| | | GBP | GBP |
+----------------------------------------------------+--+---------------+---------------+
| Revenue | | - | 36,400 |
| Cost of sales | | - | (21,853) |
| GROSS PROFIT | | ------- | ------- |
| | | - | 14,547 |
+----------------------------------------------------+--+---------------+---------------+
| Administrative expenses - recurring | | (1,431,528) | (347,623) |
+----------------------------------------------------+--+---------------+---------------+
| Administrative expenses - impairment of subsidiary | | (5,105,193) | - |
+----------------------------------------------------+--+---------------+---------------+
| Administrative expenses - exceptional costs on | | - | (5,144,018) |
| Admission | | | |
+----------------------------------------------------+--+---------------+---------------+
| | | ------- | ------- |
+----------------------------------------------------+--+---------------+---------------+
| Total administrative expenses | | (6,536,721) | (5,491,641) |
+----------------------------------------------------+--+---------------+---------------+
| | | ------- | ------- |
+----------------------------------------------------+--+---------------+---------------+
| OPERATING LOSS | | (6, 536,721) | (5,477,094) |
+----------------------------------------------------+--+---------------+---------------+
| | | | |
+----------------------------------------------------+--+---------------+---------------+
| Financial income | | 123,978 | 9,573 |
+----------------------------------------------------+--+---------------+---------------+
| Financial expenses | | (187,520) | (129,311) |
+----------------------------------------------------+--+---------------+---------------+
| | | ------- | ------- |
+----------------------------------------------------+--+---------------+---------------+
| LOSS ON ORDINARY ACTIVITIES BEFORE TAXATION | | (6,600,263) | (5,596,832) |
+----------------------------------------------------+--+---------------+---------------+
| Tax on loss on ordinary activities | | - | - |
+----------------------------------------------------+--+---------------+---------------+
| | | ------- | ------- |
+----------------------------------------------------+--+---------------+---------------+
| LOSS ON ORDINARY ACTIVITIES AFTER TAXATION | | (6,600,263) | (5,596,832) |
+----------------------------------------------------+--+---------------+---------------+
| | | ------ | ------ |
+----------------------------------------------------+--+---------------+---------------+
+----------------------------------------------------+--+---------------+---------------+
| BASIC AND DILUTED EARNINGS PER SHARE | | | |
+----------------------------------------------------+--+---------------+---------------+
| | | | |
+----------------------------------------------------+--+---------------+---------------+
| Loss per share | | (GBP0.39) | (GBP4.49) |
+----------------------------------------------------+--+---------------+---------------+
| | | | |
+----------------------------------------------------+--+---------------+---------------+
| | | ------ | ------ |
+----------------------------------------------------+--+---------------+---------------+
| | | | |
+----------------------------------------------------+--+---------------+---------------+
| | | | |
+----------------------------------------------------+--+---------------+---------------+
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE 12 MONTHS ENDED 30 SEPTEMBER
2008
+-------------------------+----------+-----------+-----------+----------+-------------+--------------+
| GROUP | Share | Share | Foreign | Treasury | Retained | Total |
| | Capital | Premium | Exchange | Reserve | Earnings | Equity |
| | | | Reserve | | | |
+-------------------------+----------+-----------+-----------+----------+-------------+--------------+
| 2008 | GBP | GBP | GBP | GBP | GBP | GBP |
+-------------------------+----------+-----------+-----------+----------+-------------+--------------+
| | | | | | | |
+-------------------------+----------+-----------+-----------+----------+-------------+--------------+
| Total equity at 1 | 213,362 | 9,186,106 | - | 3,688 | (2,215,318) | 7,187,838 |
| October 2007 | | | | | | |
+-------------------------+----------+-----------+-----------+----------+-------------+--------------+
| Transfer to translation | - | - | 240,246 | - | (240,246) | - |
| reserve1 | | | | | | |
+-------------------------+----------+-----------+-----------+----------+-------------+--------------+
| Revaluation of | - | - | - | - | 62,651 | 62,651 |
| long-term loan to | | | | | | |
| amortised cost2 | | | | | | |
+-------------------------+----------+-----------+-----------+----------+-------------+--------------+
| | ------- | ------- | ------- | ------- | ------- | ------- |
+-------------------------+----------+-----------+-----------+----------+-------------+--------------+
| Restated total equity | 213,362 | 9,186,106 | 240,246 | 3,688 | (2,392,913) | 7,250,489 |
| at 1 October 2007 | | | | | | |
+-------------------------+----------+-----------+-----------+----------+-------------+--------------+
| | | | | | | |
+-------------------------+----------+-----------+-----------+----------+-------------+--------------+
| Loss for the year | - | - | - | - | (6,600,263) | (6,600,263) |
+-------------------------+----------+-----------+-----------+----------+-------------+--------------+
| Employee share options | - | - | - | (3,688) | 3,688 | - |
| charge for the period | | | | | | |
+-------------------------+----------+-----------+-----------+----------+-------------+--------------+
| Net currency difference | - | - | 75,037 | - | - | 75,037 |
| on translation of | | | | | | |
| foreign operations | | | | | | |
+-------------------------+----------+-----------+-----------+----------+-------------+--------------+
| Transfer of translation | - | - | (315,283) | - | - | (315,283) |
| differences to income | | | | | | |
| statement on impairment | | | | | | |
| of subsidiary | | | | | | |
+-------------------------+----------+-----------+-----------+----------+-------------+--------------+
| | ------- | ------- | ------- | ------- | ------- | ------- |
+-------------------------+----------+-----------+-----------+----------+-------------+--------------+
| Total equity at 30 | 213,362 | 9,186,106 | - | - | (8,989,488) | 409,980 |
| September 2008 | | | | | | |
+-------------------------+----------+-----------+-----------+----------+-------------+--------------+
| | ----- | ------ | ------ | ------ | ------ | ------ |
+-------------------------+----------+-----------+-----------+----------+-------------+--------------+
| | | | | | | |
+-------------------------+----------+-----------+-----------+----------+-------------+--------------+
1. Differences on translation of net foreign investments of GBP240,246 as at 1
October 2007 which were previously stated within retained earnings have been
reclassified to a separate translation reserve.
2. Long-term loans previously reported at cost less issue costs at 1 October
2007 have been restated to amortised cost.
CONSOLIDATED BALANCE SHEET AS AT 30 SEPTEMBER 2008
+----------------------------------------------------+--+-------------------------------------+---------------+
| | | GROUP |
+----------------------------------------------------+--+-----------------------------------------------------+
| | | 2008 | 2007 |
+----------------------------------------------------+--+-------------------------------------+---------------+
| | | | Restated |
+----------------------------------------------------+--+-------------------------------------+---------------+
| | | GBP | GBP |
+----------------------------------------------------+--+-------------------------------------+---------------+
| NON-CURRENT ASSETS | | | |
| | | | |
+----------------------------------------------------+--+-------------------------------------+---------------+
| Investments in subsidiaries | | - | - |
+----------------------------------------------------+--+-------------------------------------+---------------+
| Goodwill | | - | 4,614,030 |
+----------------------------------------------------+--+-------------------------------------+---------------+
| Other intangible assets | | 1,767,246 | 1,876,308 |
+----------------------------------------------------+--+-------------------------------------+---------------+
| Property, plant and equipment | | 1,666 | 8,775 |
+----------------------------------------------------+--+-------------------------------------+---------------+
| | | ------- | ------- |
+----------------------------------------------------+--+-------------------------------------+---------------+
| | | 1,768,912 | 6,499,113 |
+----------------------------------------------------+--+-------------------------------------+---------------+
| CURRENT ASSETS | | | |
+----------------------------------------------------+--+-------------------------------------+---------------+
| | | | |
+----------------------------------------------------+--+-------------------------------------+---------------+
| Inventories | | - | 56,487 |
+----------------------------------------------------+--+-------------------------------------+---------------+
| Trade and other receivables | | 92,859 | 193,513 |
+----------------------------------------------------+--+-------------------------------------+---------------+
| Cash deposits used as security for loan notes | | - | 2,000,000 |
+----------------------------------------------------+--+-------------------------------------+---------------+
| Cash and cash equivalents | | 94,471 | 2,953,040 |
+----------------------------------------------------+--+-------------------------------------+---------------+
| | | ------- | ------- |
+----------------------------------------------------+--+-------------------------------------+---------------+
| | | 187,330 | 5,203,040 |
+----------------------------------------------------+--+-------------------------------------+---------------+
| | | ------- | ------- |
+----------------------------------------------------+--+-------------------------------------+---------------+
| TOTAL ASSETS | | 1,956,242 | 11,702,153 |
+----------------------------------------------------+--+-------------------------------------+---------------+
| | | ------ | ------ |
+----------------------------------------------------+--+-------------------------------------+---------------+
| EQUITY | | | |
+----------------------------------------------------+--+-------------------------------------+---------------+
| | | | |
+----------------------------------------------------+--+-------------------------------------+---------------+
| Share capital | | 213,362 | 213,362 |
+----------------------------------------------------+--+-------------------------------------+---------------+
| Share premium | | 9,186,106 | 9,186,106 |
+----------------------------------------------------+--+-------------------------------------+---------------+
| Treasury reserve | | - | 3,688 |
+----------------------------------------------------+--+-------------------------------------+---------------+
| Foreign exchange reserve | | - | 240,246 |
+----------------------------------------------------+--+-------------------------------------+---------------+
| Retained earnings | | (8,989,488) | (2,392,913) |
+----------------------------------------------------+--+-------------------------------------+---------------+
| | | ------- | ------- |
+----------------------------------------------------+--+-------------------------------------+---------------+
| TOTAL EQUITY | | 409,980 | 7,250,489 |
+----------------------------------------------------+--+-------------------------------------+---------------+
| | | | |
+----------------------------------------------------+--+-------------------------------------+---------------+
| | | | |
+----------------------------------------------------+--+-------------------------------------+---------------+
| CURRENT LIABILITIES | | 287,982 | 1,380,627 |
+----------------------------------------------------+--+-------------------------------------+---------------+
| | | | |
+----------------------------------------------------+--+-------------------------------------+---------------+
| NON-CURRENT LIABILITIES | | | |
| | | | |
+----------------------------------------------------+--+-------------------------------------+---------------+
| Deferred income tax liability | | 594,986 | 594,986 |
+----------------------------------------------------+--+-------------------------------------+---------------+
| Long term borrowings | | 532,476 | 2,476,051 |
+----------------------------------------------------+--+-------------------------------------+---------------+
| Provisions | | 130,818 | - |
+----------------------------------------------------+--+-------------------------------------+---------------+
| | | ------- | ------- |
+----------------------------------------------------+--+-------------------------------------+---------------+
| TOTAL LIABILITIES | | 1,546,262 | 4,451,664 |
+----------------------------------------------------+--+-------------------------------------+---------------+
| | | ------- | ------- |
+----------------------------------------------------+--+-------------------------------------+---------------+
| TOTAL EQUITY AND LIABILITIES | | 1,956,242 | 11,702,153 |
+----------------------------------------------------+--+-------------------------------------+---------------+
| | | ------ | ------ |
+----------------------------------------------------+--+-------------------------------------+---------------+
Long-term loans previously reported at cost less issue costs at 1 October 2007
have been restated to amortised cost. The financial statements were approved and
authorised for issue by the Board and were signed on its behalf on 23 February
2009
CONSOLIDATED CASH FLOW STATEMENTFOR THE 12 MONTHS ENDED 30 SEPTEMBER 2008
+----------------------------------------------------+--+---------------+---------------+
| | | GROUP |
+----------------------------------------------------+--+-------------------------------+
| | | 2008 | 2007 |
+----------------------------------------------------+--+---------------+---------------+
| | | | Restated |
+----------------------------------------------------+--+---------------+---------------+
| | | GBP | GBP |
+----------------------------------------------------+--+---------------+---------------+
| Loss on ordinary activities before tax | | (6,600,263) | (5,596,832) |
+----------------------------------------------------+--+---------------+---------------+
| | | | |
+----------------------------------------------------+--+---------------+---------------+
| Depreciation of property, plant and equipment | | 7,006 | 709 |
+----------------------------------------------------+--+---------------+---------------+
| Finance income | | (123,978) | (9,573) |
+----------------------------------------------------+--+---------------+---------------+
| Finance charge | | 187,520 | 129,311 |
+----------------------------------------------------+--+---------------+---------------+
| Share option charge | | - | 3,688 |
+----------------------------------------------------+--+---------------+---------------+
| Fair value charge on shares issued for directors' | | - | 4,440,323 |
| and consultants' services at par | | | |
+----------------------------------------------------+--+---------------+---------------+
| Loss on impairment of subsidiary | | 294,184 | - |
+----------------------------------------------------+--+---------------+---------------+
| Impairment of goodwill | | 4,660,675 | - |
+----------------------------------------------------+--+---------------+---------------+
| Impairment of investment and provision for | | - | - |
| expenses incurred at subsidiary | | | |
+----------------------------------------------------+--+---------------+---------------+
| Impairment of intangible assets | | - | - |
+----------------------------------------------------+--+---------------+---------------+
| Loss on disposal of tangible assets | | 737 | - |
+----------------------------------------------------+--+---------------+---------------+
| Amortisation of intangible assets | | 130,464 | 4,281 |
+----------------------------------------------------+--+---------------+---------------+
| Exchange difference and other non-cash items | | 38,316 | - |
+----------------------------------------------------+--+---------------+---------------+
| (Increase) / decrease in inventories | | 8,217 | 9,417 |
+----------------------------------------------------+--+---------------+---------------+
| (Increase) / decrease in receivables | | 83,254 | (164,034) |
+----------------------------------------------------+--+---------------+---------------+
| Increase / (decrease) in payables | | (1,021,078) | 639,485 |
+----------------------------------------------------+--+---------------+---------------+
| | | ------- | ------ |
+----------------------------------------------------+--+---------------+---------------+
| Cash used in operations | | (2,334,946) | (543,225) |
+----------------------------------------------------+--+---------------+---------------+
| | | | |
+----------------------------------------------------+--+---------------+---------------+
| Interest paid | | (131,095) | (129,311) |
| Interest received | | 123,978 | 9,573 |
+----------------------------------------------------+--+---------------+---------------+
| | | ------- | ------ |
+----------------------------------------------------+--+---------------+---------------+
| Net cash used in operating activities | | (2,342,063) | (662,963) |
+----------------------------------------------------+--+---------------+---------------+
| | | ------- | ------ |
+----------------------------------------------------+--+---------------+---------------+
| Cash flows from investing activities | | | |
+----------------------------------------------------+--+---------------+---------------+
| | | | |
+----------------------------------------------------+--+---------------+---------------+
| Acquisition of subsidiary, net of cash acquired | | - | (313,460) |
+----------------------------------------------------+--+---------------+---------------+
| Impairment of subsidiary, net of cash | | (8,605) | |
+----------------------------------------------------+--+---------------+---------------+
| Cash acquired with subsidiary | | - | 70 |
+----------------------------------------------------+--+---------------+---------------+
| Purchases of property, plant and equipment | | (507,770) | - |
+----------------------------------------------------+--+---------------+---------------+
| Proceeds from sale of equipment | | - | 400 |
+----------------------------------------------------+--+---------------+---------------+
| | | ------- | ------ |
+----------------------------------------------------+--+---------------+---------------+
| Net cash used in investing activities | | (516,375) | (312,990) |
+----------------------------------------------------+--+---------------+---------------+
| | | ------- | ------ |
+----------------------------------------------------+--+---------------+---------------+
| Cash flows from financing activities | | | |
+----------------------------------------------------+--+---------------+---------------+
| | | | |
+----------------------------------------------------+--+---------------+---------------+
| Proceeds from borrowings | | - | 2,538,702 |
+----------------------------------------------------+--+---------------+---------------+
| Repayment of borrowings | | (2,000,000) | (536,679) |
+----------------------------------------------------+--+---------------+---------------+
| Proceeds from issue of ordinary shares | | - | 4,544,852 |
+----------------------------------------------------+--+---------------+---------------+
| Share issue costs paid | | - | (622,384) |
+----------------------------------------------------+--+---------------+---------------+
| | | ------- | ------ |
+----------------------------------------------------+--+---------------+---------------+
| Net cash (repaid) / raised by financing activities | | (2,000,000) | 5,924,491 |
| | | | |
+----------------------------------------------------+--+---------------+---------------+
| | | ------- | ------ |
+----------------------------------------------------+--+---------------+---------------+
| Net (decrease)/increase in cash and cash | | (4,858,438) | 4,948,538 |
| equivalents | | | |
+----------------------------------------------------+--+---------------+---------------+
| Cash and cash equivalents at beginning of period | | 4,953,040 | 4,974 |
+----------------------------------------------------+--+---------------+---------------+
| Exchange losses on cash and cash equivalents | | (131) | (472) |
+----------------------------------------------------+--+---------------+---------------+
| | | ------- | ------ |
+----------------------------------------------------+--+---------------+---------------+
| Cash and cash equivalents and cash deposits at end | | 94,471 | 4,953,040 |
| of the period | | | |
+----------------------------------------------------+--+---------------+---------------+
| | | ------ | ------ |
+----------------------------------------------------+--+---------------+---------------+
Cash deposits of GBP2,000,000, which were offset against proceeds from
borrowings in the prior year to 30 September 2007, have been restated as cash
and cash equivalents in the current year.
1. ACCOUNTING POLICIES
The financial statements have been prepared in accordance with International
Financial Reporting Standards ("IFRS") and IFRIC interpretations as adopted
by the European Union and with those parts of the Companies Act, 1985 applicable
to companies reporting under IFRS. The financial statements have been prepared
under the historical cost convention.
The preparation of financial statements in conformity with IFRS requires the use
of estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. Although these estimates are
based on management's best knowledge of the amount, event or actions, actual
results ultimately may differ from those estimates.
The financial statements are prepared on a going concern basis, the validity of
which is dependent on the raising of finance by the issue of additional share
capital referred to in the Chairman's Statement accompanying these accounts.
2. EXCEPTIONAL ITEMS
Exceptional items of GBP5,105,193 in the current year relate entirely to the
impairment of the assets of PG Industries Limited, related goodwill and
GBP130,818 for provisions on loans made by the Company to PG Industries Limited
after the year-end.
PG Industries Limited has not generated revenues from product sales during the
period. On the basis that a manufacturing facility operating from New Zealand is
no longer economically viable given recent adverse movements in global market
conditions the assets of the subsidiary were impaired.
The recoverable amount of the assets was assessed as fair value less costs to
sell. Due to the specialised nature of the plant and raw materials held as stock
for which there is no active market and no realistic scrap value, the Directors
consider the recoverable value of these assets to be nil. Trade and other
debtors held by the subsidiary at 30 September 2008 are not considered
recoverable in view of the trading performance after the year-end and have been
fully written off.
Exceptional items in the prior year to 30 September 2007 were one-off costs
related directly to Admission to AIM.
3.SEGMENTAL REPORTING
The Group's primary reporting format for reporting segment information is
business segments and the segments are defined as UK and New Zealand as this
split coincides with a geographical origin split of activities No secondary
segment exists. The turnover assets and operating expenses by geographical
location are as follow:
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | | 2008 | 2007 |
+--+--+--------------------+-----------------------------------------+---------------------------------------+
| | | Allocated | UK | New | Total | UK | New | Total |
| | | | | Zealand | | | Zealand | |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | | GBP | GBP | GBP | GBP | GBP | GBP |
| | | | | | | | | |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | Turnover | - | - | - | 36,400 | - | 36,400 |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | Cost of sales | - | - | - | (21,853) | - | (21,853) |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | | ------- | ------- | ------- | ------- | ------- | ------- |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | Gross margin | - | - | - | 14,547 | - | 14,547 |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | | | | | | | |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | Administrative | | | | | | |
| | | expenses | | | | | | |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | | (962,348) | (469,180) | (1,431,528) | (337,824) | (9,799) | (347,623) |
| | | Recurring | | | | | | |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | Exceptional | (130,821) | (4,974,372) | (5,105,193) | (5,144,018) | - | (5,144,018) |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | | ------- | ------- | ------- | ------- | ------- | ------- |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | Total | (1,093,169) | (5,443,552) | (6,536,721) | (5,481,842) | (9,799) | (5,491,641) |
| | | administrative | | | | | | |
| | | expenses | | | | | | |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | | ------- | ------- | ------- | ------- | ------- | ------- |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | Operating | (1,093,169) | (5,443,552) | (6,536,721) | (5,467,295) | (9,799) | (5,477,094) |
| | | loss | | | | | | |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | | ----- | ----- | | ----- | ----- | |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | Unallocated | | | | | | |
| | | | | | | | | |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | Net | | | (63,542) | | | (119,738) |
| | | finance | | | | | | |
| | | expense | | | | | | |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | | | | ------- | | | ------- |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | Loss on | | | (6,600,263) | | | (5,596,832) |
| | | ordinary | | | | | | |
| | | activities | | | | | | |
| | | before tax | | | | | | |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | Taxation | | | - | | | - |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | | | | ------- | | | ------- |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | Loss on | | | (6,600,263) | | | (5,596,832) |
| | | ordinary | | | | | | |
| | | activities | | | | | | |
| | | after | | | | | | |
| | | taxation | | | | | | |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | | | | ----- | | | ------ |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | | | | | | | |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | | | | | | | |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | Depreciation | 640 | 136,830 | 137,470 | 709 | 4,281 | 4,990 |
| | | and | | | | | | |
| | | amortisation | | | | | | |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | | ----- | ----- | ----- | ----- | ----- | ------ |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | | | | | | | |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | Capital | - | 570,770 | 570,770 | - | 3,714 | 3,714 |
| | | expenditure | | | | | | |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | | ----- | ----- | ----- | ----- | ----- | ------ |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | | | | | | | |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | Total Assets | 1,956,242 | - | 1,956,242 | 5,219,298 | 6,482,855 | 11,702,153 |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | | ----- | ----- | ----- | ----- | ----- | ----- |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | | | | | | | |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | Total | 1,455,283 | 90,979 | 1,546,262 | 3,276,639 | 1,175,025 | 4,451,664 |
| | | liabilities | | | | | | |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | | ----- | ----- | ----- | ----- | ----- | ------ |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
| | | | | | | | | |
+--+--+--------------------+-------------+-------------+-------------+-------------+-----------+-------------+
Turnover in 2007 was in respect of revenues from third parties. As at the 30
September 2008 the expenditure in New Zealand related solely to Vecowood.
Acetowood was held as intellectual property only.
4. DIVIDENDS
The Directors are unable to authorise, and do not recommend the payment of, a
dividend.
5. TAXATION
5.1. Factors affecting tax charge for the 12 months
The Group has no UK corporation tax charge for the period due to the loss before
tax suffered by the Group. Non-assessable items refer to amounts related to the
impairment of the goodwill and assets of PG Industries, and to exchange
differences and amortisation, temporary differences and tax losses amounts arise
from other operating items contributing to the Company's losses
5.2. Factors that may affect future tax charges
The Group has unutilised tax losses of approximately GBP2,964,840 (2007:
GBP1,587,000) available to carry forward against future trading profits of the
Group, of which GBP2,479,660 (2007: GBP1,571,000) are in respect of UK
activities and GBP485,180 (2007: GBP16,000) are in respect of overseas
activities. No deferred income tax asset has been recognised in these financial
statements for these tax losses as a result of uncertainty over recoverability.
The Group recognised a deferred income tax liability of GBP594,986 (2007:
GBP594,986) on the acquisition of PGI.
6. EARNINGS PER SHARE
Basic and diluted loss per share has been calculated by dividing the loss for
the financial period attributable to ordinary shareholders amounting to
GBP6,660,263 (2007: GBP5,596,832) by 17,000,000 (2007: 1,245,661) ordinary
shares, the weighted average number of ordinary shares in issue during the
period.
There is no adjustment for contingently issue-able warrants issued to 340,000 St
Helen's Capital Plc as the exercise price remains significantly above the
current market price. No adjustment is made for 5,000,000 warrants issued to Fox
Capital as no amounts had been drawn on the related GBP100,000 loan prior to the
year-end. No adjustment is made for the deferred shares, as their rights are
limited.
7. POST BALANCE SHEET EVENTS
7.1. Conversion of loan, subscription for new ordinary shares and grant of
warrants
On 24th February 2009, the Directors will issue a circular to shareholders
seeking shareholder approval for a waiver of rule 9 of the Takeover Code in
respect of the Loan to be made by Fox which increases the holding and voting
rights in the Company beyond 30% on conversion. Fox currently have an interest
in 28.16% of the Company's issued share capital.
In support of the Company's capital funding requirement, Fox has agreed to
subscribe for a further amount of GBP200,000 at a price of 2p per share. Under
the terms of the agreement which are interlinked, the Company will seek from
shareholders approval for the grant of warrants for 4,000,000 new ordinary
shares at 2p per share. Shareholder approval will also be sought for such
subscription for the purposes of rule 9 of the Takeover Code.
The terms and conditions of the conversion, subscription and grant of warrants
are set out in the circular and in the financial statements. On drawdown, the
loan from Fox of GBP100,000 will be accounted for and disclosed as a compound
instrument with equity and share capital components.
7.2. Move to a licensing model and decision to cease trading at the subsidiary
At the year end, due to the likelihood of a protracted global recession and
adverse timber price movements the Directors did not believe a manufacturing
facility operating from New Zealand to be economically viable in the medium
term. Therefore the Directors resolved to move from a product manufacturing
business model to a technology licensing business model, and accordingly
impaired the value of the New Zealand assets to zero, and wrote these off
through exceptional items.
In recognition of this impairment, the Directors announced on 24 December 2008
that they intended to appoint a liquidator or receiver to PG Industries. The
cessation of trading at PG Industries will remove approximately GBP195,000
annual costs from the business. The cost implications of this decision, apart
from the operational cost savings above, had not been quantified at the date of
signing of the financial statements.
8. STATUS OF PRELIMINARY RESULTS
The financial information in the preliminary results does not constitute
statutory accounts within the meaning of Section 240 of the Companies Act 1985
(the "Act"). The full statutory accounts for the year ended 30 September 2008
were signed on 23 February 2009. A copy, when approved, will be filed with the
Registrar of Companies following the Company's Annual General Meeting, which
will be held at the offices of Zeus Capital Limited on 2 April 2009 at 11.15 am.
9.DELIVERY OF ACCOUNTS
The statutory accounts in respect of the year ended 30 September 2007 have
been delivered to the Registrar of Companies and the auditors of the Company
made a report thereon under Section 235 of the Act. That report was an
unqualified report and did not contain a statement under Section 237 (2) or (3)
of the Act.
10.AVAILABILITY OF ACCOUNTS
This preliminary statement is not being posted to shareholders. The Report
and Accounts will be posted to shareholders on 24 February 2009. Copies of this
announcement and further copies of the Report and Accounts can be downloaded
from the website www.kurawood.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR VZLBLKLBZBBB
Grafico Azioni Kurawood (LSE:KURA)
Storico
Da Mag 2024 a Giu 2024
Grafico Azioni Kurawood (LSE:KURA)
Storico
Da Giu 2023 a Giu 2024
