Final Results
27 Giugno 2008 - 1:47PM
UK Regulatory
27 June 2008
Regenesis Group PLC
("Regenesis" or the "Company")
Final Results for the year ended 31 December 2007
Chairman's Statement
Introduction
I am pleased to present the results for the year ended 31 December 2007.
In April 2007, shareholders approved a change in the Group's investment
strategy to that of providing short term asset finance. This involved a change
in the Group's name from Poly Information plc. These changes took place at a
time when the sentiment towards the economy, both in the UK and overseas, began
to deteriorate resulting in a significant increase in interest rates and a
determination, by The Bank of England, to control inflation. In the light of
this, the Board considered that a cautious approach to the business
opportunities presented was appropriate. Once operational, this action
protected the Group's capital and ensured that the loan book was fully
performing. However, it did result in the Group not being able to demonstrate
that it had substantially implemented its new strategy quickly enough to
satisfy the AIM Rules. As a result, trading in the Company's shares on AIM was
suspended in October 2007, but, following compliance, trading in the Company's
shares re-commenced in April 2008. The Group's loan book is fully performing
and the volume of enquiries continues at a good level.
Financial Performance
In the year under review, the Group incurred a trading loss of �413,000. As
reported at the half-year stage, a substantial proportion of the costs causing
this loss related to the fees associated with the admission to AIM. Combined
with a cautious approach in managing the loan book, this has meant that the
size of the loan book was lower than anticipated in the last six months of
2007.
Where required to support attractive lending proposals, the Group's cash
resources have been supplemented by an unsecured loan from me, providing a
clear demonstration of my confidence in the strategy. Notably, loan offers
totalling over �4.4 million were made between April and December 2007 at
interest rates varying between 1.50 per cent and 1.75 per cent per month.
Outlook
Since the end of the year the level of enquiries has continued at or above the
level encountered in 2007 and the Group's resources remain fully invested in
performing loans. The directors of the Company (the Directors) have examined a
number of options to secure further capital for the Group to facilitate growth
in the lending book. Regrettably, against the background of the "credit
crunch", they have not been able to raise any additional equity at an
acceptable cost, and consider that the low market capitalisation of the Company
and the low liquidity of the ordinary shares has made an investment in the
Company unattractive to potential investors. A further obstacle to the
development of the Group is the cost of being a public company, which the
Directors estimate amounts to approximately �100,000 per annum.
The Company's bank facilities are due for renewal. In proposing renewal terms,
the Company's bankers have tightened the conditions and covenants that were
contained in the original facilities. The Directors have examined these
carefully and reached the conclusion that they will constrain the ability of
the Company to undertake new business and are unlikely to be varied
significantly by negotiation. Without a suitable bank facility in place, the
Company's ability to make short term, secured loans is further restricted.
Current trading performance is in line with the Directors' expectations. All
loans outstanding at 31 December 2007 have since been repaid and the current
loan book amounts to approximately �856,000. Monthly rates charged to customers
now run at a minimum of 1.75 per cent.
Although the Group is profitable at the operating level, additional capital and
/or reduced central overhead would improve shareholder returns further. All
options have been considered to this effect. As it has not been possible to
raise additional capital or to renew the Group's bank facilities on favourable
terms, the Directors have decided to seek shareholder approval for the
cancellation of trading of the Company's ordinary shares on AIM and to
re-register the Company as a private company to reduce the central overhead.
These changes are being proposed to reduce the Group's cost base and to
conserve the Group's cash resources. The Directors believe that the Group has
adequate resources to continue its operational existence for the foreseeable
future irrespective of whether or not shareholders approve these proposals at
the forthcoming Annual General Meeting.
The Directors intend to repay the Group's existing bank loans on redemption of
the current loan book and to use the Group's available cash resources
cautiously to continue to make short term, secured loans. The Directors intend
to monitor market conditions, with a view to seeking bank facilities to expand
the activities of the Group as and when such facilities become available on
acceptable terms.
A circular to shareholders setting out the proposals in more detail, which
includes the notice for the Annual General Meeting, will be sent to
shareholders in the near future.
The Board extends its sincere thanks to Anthony Leon, who stepped down as a
non-executive Director in January 2008 to pursue his other business interests,
for his valuable support during the change in the Group's strategy and during
the early months of its development.
Marc J Duschenes
Chairman
27 June 2008
Further enquiries:
Regenesis Group plc Tel: 0161 929 4969
Marc Duschenes Tel: 0161 929 5088
John Barnacle
John East & Partners Limited Tel: 020 7628 2200
Simon Clements
Consolidated Income Statement
For the year ended 31 December 2007
Notes Year ended Year ended
31 December 31 December
2007 2006
�'000 �'000
Continuing Operations
Revenue 106 -
Interest Payable (5) -
Other Cost of Sales (58) -
Gross Profit 43 -
Profit/(Loss) on disposal of subsidiary - (32)
Administration Expenses (477) (147)
Operating loss before financing 2 (434) (179)
Finance Income 3 21 12
Loss before tax (413) (167)
Tax 4 - -
Loss for year ending 31 December (413) (167)
Attributed to equity holders (413) (167)
Loss per share
From continuing operations - basic and 5 (0.70p) (0.40p)
diluted
All revenue and costs originate from continuing activities.
Consolidated Balance Sheet
At 31 December 2007
Notes 31 December 31 December
2007 2006
�'000 �'000
Assets
Current Assets
Loans and advances to customers 6 388 -
Other receivables 6 4 9
Cash on hand and balances with banks 368 740
Total Assets 760 749
Liabilities
Current Liabilities
Interest bearing loans and borrowings 7 (279) -
Trades and other payables 7 (100) (15)
Total Liabilities (379) (15)
Total Net Assets 381 734
Equity
Issued capital 993 992
Share premium 1,538 1,495
Share option reserve 16 -
Retained earnings (2,166) (1,753)
Total Equity 381 734
Consolidated Cash Flow Statement
For the year ended 31 December 2007
Year ended Year ended
31 December 31 December
2007 2006
�'000 �'000
Operating Activities
Net loss from ordinary activities (413) (167)
Adjustments for:
(Decrease)/Increase in trade and otherreceivables (383) 5
Increase/(Decrease) in trade and other payables 85 (6)
Equity-settled share-based payment expenses 31 -
Loss on sale of fixed asset investment - 32
Cash absorbed by operations (680) (136)
Income tax paid - -
Cash flows from operating activities (680) (136)
Investing activities
Purchase of and loans to fixed assets investments - (112)
Sale of fixed asset investments - 80
Net cash used in investing activities - (32)
Proceeds from issue of share capital 29 518
Increase in borrowings 279 -
Net cash from financing activities 308 518
Net (reduction)/increase in cash and cash (372) 350
equivalents
Cash and cash equivalents at 1 January 740 390
Cash and cash equivalents at 31 December 368 740
Consolidated Statement of Changes in Shareholder Equity
Year ended Year ended
31 December 31 December
2007 2006
�'000 �'000
Shareholders' equity brought forward 734 383
Loss for the year (413) (167)
New share capital issued 29 544
Share issue costs - (26)
Share-based payments 31 -
Total movement in shareholders' equity (353) 351
Shareholders' equity carried forward 381 734
Notes to the Financial Statements
For the year ended 31 December 2007
1.Publication of non statutory accounts
The announcement set out above does not constitute a full financial statement
of the group's affairs for the year ended 31 December 2007. The full accounts
have yet to be delivered to the Registrar of Companies. The annual report and
accounts will be posted to all shareholders and be available at the Company's
website www.regenesisgroup.co.uk.
The consolidated balance sheet at 31 December 2007 and the consolidated profit
and loss account, consolidated cash flow statement and associated notes for the
year then ended have been extracted from the Group's 2007 statutory financial
statements upon which the auditors opinion is unqualified and does not include
any statement under Section 237 of the Companies Act 1985.
2. Operating Loss
Year ended Year ended
31 December 31 December
2007 2006
�'000 �'000
Auditors' remuneration
Fees payable to the Group's auditor for the audit of 7 12
the Group's annual financial statements
Fees payable to the Group's auditor for other 2 -
services:
* The audit of the Group's subsidiaries
Pursuant to legislation 1 -
* Other services relating to taxation 29 -
* Other services
39 12
Transaction costs, including 59 -
* Corporate finance 72 -
* Legal fees 63 -
* Nomad fees
194 -
3.Finance Income
Year ended Year ended
31 December 31 December
2007 2006
�'000 �'000
Interest receivable and similar income 21 12
4. Tax
Year ended Year ended
31 December 31 December
2007 2006
�'000 �'000
Tax on ordinary activities - -
The differences between the total current tax shown
above and the amount calculated by applying the
standard rate of UK corporation tax of 30 per cent.
(2006: 30 per cent.) to the profit and loss is as
follows:
Year ended Year ended
31 December 31 December
2007 2006
�'000 �'000
Loss on ordinary activities before tax (413) (167)
Loss on ordinary activities multiplied by standard (124) (50)
rate of corporation tax in the UK of 30 per cent.
Effects of:
Expenses not deductible for tax purposes 20 10
Write down/loss on sale of investment - 9
Movement in tax losses 104 31
- -
The Company has available trading losses to carry forward of approximately �
593,000 (2006 - �246,000) although it is unlikely that they will be available
for use against future profits of the Company.
The Company has capital losses to carry forward of approximately �1,756,000.
The Company has no liability to deferred taxation.
5.Loss per Share
Year ended Year ended
31 December 31 December
2007 2006
�'000 �'000
Loss for the period (413) (167)
Weighted average number of ordinary shares 59,223,505 41,663,156
Loss per ordinary share basic (0.70p) (0.40p)
There are 2,147,366 potentially issuable shares that have not been included in
a diluted EPS calculation as they are anti-dilutive.
The deferred shares have not been included in the loss per share calculation as
they have no voting rights and have negligible rights as to dividends and on a
return of capital. The weighted average number of shares for the year ended 31
December 2006 has been restated to reflect the share consolidation carried out
in April 2007.
6.Current Assets
Year ended Year ended
31 December 31 December
2007 2006
�'000 �'000
Loans and advances to customers 388 -
Other receivables 4 9
392 9
7. Current Liabilities
Year ended Year ended
31 December 31 December
2007 2006
�'000 �'000
Interest bearing loans and borrowings 279 -
Trade payables 1 15
Other payables 99 -
379 15
8. Copies of the Report and Accounts
Copies of the Report and Accounts will be sent to shareholders shortly and will
be available from the registered office of the Company, Richmond House, Heath
Road, Hale, Cheshire WA14 2XP and on the Company's website
www.regenesisgroup.co.uk
END
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