ASSETCO PLC — Interim / Quarterly Report 2016

Jun 14, 2016

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RNS Number : 0710B

AssetCo PLC

14 June 2016

Date: Tuesday, 14 June 2016	Immediate Release

AssetCo plc

Providers of management and resources to the fire and emergency services in the Middle East

("AssetCo" or the "Company" or "Group")

Half-year Report

for the six months ended 31 March 2016

Introduction

We are pleased to announce that our results for the first half of the year reflect a continuing improvement in profit and cash generation.

Results

The Consolidated Income Statement for the period ended 31 March 2016 shows an operating profit of £2.1m (2015: £1.8m) on revenue of £11.0m (2015: £10.4m) and a profit before tax of £1.9m (2015: £1.5m).  The improvement in profitability has resulted from the increase in the number of fire service personnel being supplied to our Middle East Fire Service contracts.

Cash Generation

The Company generated £2.2m of free cash in the period and at 31 March 2016 we had total cash of £18.5m (£15.6m at 30 September 2015) comprising free cash balances of £15.5m (£12.8m at 30 September 2015) and restricted cash balances held in respect of Bonds amounting to £3.0m (£2.8m at 30 September 2015).

Claim against Grant Thornton

The Company continues to pursue a claim against its former auditors Grant Thornton, in respect of negligent audits for the years ended 30 September 2009 and 2010, for losses, interest and costs totalling approximately £42m.

Outlook

We continue to produce a performance in line with management expectations.  We will keep shareholders updated of further progress on trading, future contracts and the claim against Grant Thornton during the course of the year.

Tudor Davies

Chairman

14 June 2016

Editor's Note:

AssetCo is principally involved in the provision of management and resources to the fire and emergency services in the Middle East.  For further details, visit the website, www.assetco.com.

Symbol: AiM: ASTO;

Market capitalisation: £39.57m

AssetCo plc

Consolidated Income Statement

for the six months ended 31 March 2016

		Six months ended		Year ended
	Note	31 March 2016	31 March 2015	30 September 2015
		£'000	£'000	£'000
Revenue		11,003	10,418	21,660
Cost of sales		(7,922)	(7,985)	(15,564)
Gross profit		3,081	2,433	6,096
Administrative expenses		(968)	(672)	(1,647)
Operating profit		2,113	1,761	4,449
Finance income		7	10	23
Finance costs		(178)	(269)	(459)
Profit before taxation		1,942	1,502	4,013
Income tax expense		-	-	-
Profit for the period		1,942	1,502	4,013
Earnings per share (EPS):	3
Basic - pence		15.90	12.30	32.86
Diluted - pence		15.90	12.30	32.86

AssetCo plc Consolidated Statement of Comprehensive Income for the six months ended 31 March 2016
		Six months ended		Year ended
		31 March 2016	31 March 2015	30 September 2015
		£'000	£'000	£'000
Recognised profit for the period		1,942	1,502	4,013
Other comprehensive income:
Exchange differences on translating foreign operations		839	1,107	866
Other comprehensive income net of tax		839	1,107	866
Total comprehensive income for the period		2,781	2,609	4,879

AssetCo plc Consolidated Statement of Financial Position as at 31 March 2016
		At 31 March		At 30 September
		2016	2015	2015
	Notes	£'000	£'000	£'000
Assets
Non-current assets
Property, plant and equipment		-	2	-
Cash held in respect of bonds	4	2,956	2,881	2,802
Total non-current assets		2,956	2,883	2,802
Current assets
Inventories		90	-	-
Trade and other receivables	5	7,282	6,064	6,629
Cash and cash equivalents	4	15,494	10,503	12,836
Cash held as security against letters of credit	4	-	55	-
Cash held in respect of a bond	4	12	-	11
Total current assets		22,878	16,622	19,476
Total assets		25,834	19,505	22,278
Shareholders' equity
Share capital		25,474	25,474	25,474
Share premium		64,941	64,941	64,941
Foreign currency translation reserve		1,729	1,131	890
Profit and loss account		(69,768)	(74,221)	(71,710)
Total equity		22,376	17,325	19,595
Liabilities
Current liabilities
Trade and other payables	6	3,458	2,180	2,683
Total current liabilities		3,458	2,180	2,683
Total liabilities		3,458	2,180	2,683
Total equity and liabilities		25,834	19,505	22,278

AssetCo plc Consolidated Statement of Changes in Equity for the six months ended 31 March 2016
	Share Capital	Foreign currency translation reserve	Profit and loss reserve	Share premium	Total equity
	£'000	£'000	£'000	£'000	£'000
Balance at 30 September 2014	25,474	24	(75,723)	64,941	14,716
Profit for the period	-	-	1,502	-	1,502
Other comprehensive income:
Exchange differences on translation	-	1,107	-	-	1,107
Total comprehensive income for the period	-	1,107	1,502	-	2,609
Balance at 31 March 2015	25,474	1,131	(74,221)	64,941	17,325
Profit for the period	-	-	2,511	-	2,511
Other comprehensive income/(expense):
Exchange differences on translation	-	(241)	-	-	(241)
Total comprehensive income/(expense) for the period	-	(241)	2,511		2,270
Balance at 30 September 2015	25,474	890	(71,710)	64,941	19,595
Profit for the period	-	-	1,942	-	1,942
Other comprehensive income: Exchange differences on translation	-	839	-	-	839
Total comprehensive income for the period	-	839	1,942	-	2,781
Balance as at 31 March 2016	25,474	1,729	(69,768)	64,941	22,376

AssetCo plc Consolidated Statement of Cash Flows for the six months ended 31 March 2016
		Six months ended		Year ended
		31 March 2016	31 March 2015	30 September 2015
	Note	£'000	£'000	£'000
Cash flows from operating activities
Cash generated from operations	7	2,410	2,253	4,758
Cash deposited in respect of performance bond		-	(223)	(223)
Cash repaid in respect of performance bond		-	2,814	2,814
Cash deposited in respect of a letter of credit		-	(55)	-
Finance costs		(178)	(269)	(459)
Net cash generated from operating activities		2,232	4,520	6,890
Cash flows from investing activities
Finance income		7	10	23
Net cash generated from investing activities		7	10	23
Cash flows from financing activities
Issue of shares (net of costs)		-	-	-
Net cash generated from financing activities		-	-	-
Net change in cash and cash equivalents		2,239	4,530	6,913
Cash and cash equivalents at the beginning of the period		12,836	5,787	5,787
Exchange differences on translation		419	186	136
Cash and cash equivalents at the end of the period		15,494	10,503	12,836

AssetCo plc Notes to the Financial Statements for the six months ended 31 March 2016
1.	Legal status and activities
	AssetCo plc (the "Company" or the "Group") is principally involved in the provision of management and resources to the fire and rescue emergency services in international markets.  It currently trades through a branch in UAE and its strategy is to develop this business.  As at period end, the Company has no trading subsidiaries and therefore the principal activities of the Group are restricted to those of the company detailed above. AssetCo plc is a public limited liability company incorporated and domiciled in England and Wales. The address of its registered office is Singleton Court Business Park, Wonastow Road, Monmouth, Monmouthshire NP25 5JA.  The Group operates from one site in UAE. AssetCo plc shares are listed on the Alternative Investment Market ("AIM") of the London Stock Exchange
2.	Basis of preparation
	The financial information in the Half-year Report has been prepared using the recognition and measurement principles of International Accounting Standards, International Financial Reporting Standards and Interpretations adopted for use in the European Union (collectively Adopted IFRSs). The principal accounting policies used in preparing the Half-year Report are those the Group expects to apply in its financial statements for the year ending 30 September 2016 and are unchanged from those disclosed in the Annual Report and Consolidated Financial Statements for the year ended 30 September 2015. The financial information for the six months ended 31 March 2016 and the six months ended 31 March 2015 is unaudited and does not constitute the Group's statutory financial statements for those periods.  The comparative financial information for the full year ended 30 September 2015 has, however, been derived from the audited statutory financial statements for that period.  A copy of those statutory financial statements has been delivered to the Registrar of Companies. While the financial figures included in this Half-year Report have been computed in accordance with IFRSs applicable to interim periods, this Half-year Report does not contain sufficient information to constitute an interim financial report as that term is defined in IAS 34. The financial statements have been presented in sterling to the nearest thousand pounds (£'000) except where otherwise indicated.
3.	Earnings per share
	Basic earnings per share is calculated by dividing the profit attributable to ordinary equity holders of the Company by the weighted average number of ordinary shares outstanding during the period.
		Six months ended		Year ended
		31 March 2016	31 March 2015	30 September 2015
		£'000	£'000	£'000
	Profit for the year	1,942	1,502	4,013
	Weighted average number of ordinary shares in issue	12,211,163	12,211,163	12,211,163
	Basic earnings per share (EPS) - pence	15.90	12.30	32.86
	There are no dilutive potential ordinary shares and, therefore, the calculation of diluted earnings per share is the same as for basic earnings per share.

4.	Cash and cash equivalents
		31 March
	2016	2015	2015
	£'000	£'000	£'000
Cash at bank and in hand	15,494	10,503	12,836
Cash and cash equivalents	15,494	10,503	12,836
UK sterling	4,839	5,972	5,399
A E Dirhams	10,655	4,531	7,437
	15,494	10,503	12,836

In addition to the above A E Dirhams amounting to £2,968,000 (31 March 2015: £2,881,000 and 30 September 2015: £2,813,000) were held on deposit as security in respect of outstanding performance bonds - see note 8 Contingent liabilities for further information - and £nil (31 March 2015: £55,000 and 30 September 2015: £nil) were held on deposit as security against letters of credit.

5.	Trade and other receivables
		31 March 2016	31 March 2015	30 September 2015
	£'000	£'000	£'000
Trade receivables	5,782	5,166	5,649
Other receivables	196	78	103
Prepayments and accrued income	1,304	820	877
	7,282	6,064	6,629

6.	Trade and other payables
	31 March 2016	31 March 2015	30 September 2015
	£'000	£'000	£'000
Trade payables	312	263	229
	Other payables	884	616	719
Other taxation and social security	3	4	3
Accruals and deferred income	2,259	1,297	1,732
	3,458	2,180	2,683

7.	Reconciliation of profit before taxation to net cash generated from operations
		Six months ended		Year ended
		31 March		30 September
		2015	2015	2015
	£'000	£'000	£'000
Profit for the period before taxation	1,942	1,502	4,013
Depreciation and impairment	-	11	12
Finance costs	178	269	459
Finance income	(7)	(10)	(23)
(Increase)/decrease in inventories	(85)	365	333
(Increase)/decrease in debtors	(283)	762	65
Increase/(decrease) in creditors	665	(646)	(101)
Cash generated from operations	2,410	2,253	4,758

8.	Contingent liabilities
		Maximum potential liability
		31 March		30 September
		2016	2015	2015
	Performance bond of AED14,461,000 related to a UAE based contract, expected to be released in full in 2017, secured by a cash deposit of AED14,461,000	2,739	2,658	2,596
	Performance bond of AED11,459,000 related to a UAE based contract, expected to reduce to AED5,730,000 in 2017 and to be released in full in 2020, secured by a cash deposit of AED1,146,000	2,170	2,106	2,057
	Performance bond of AED636,000 related to a UAE based contract, expected to be released in full in 2017, secured by a cash deposit of AED64,000	120	117	114
	The cash deposits referred to above are the same deposits as those referred to in note 4 Cash and cash equivalents.

9.	Electronic communications
	The Company is not proposing to bulk print and distribute hard copies of this Half-year Report for the six months ended 31 March 2016 unless specifically requested by individual shareholders; it can be downloaded from the Company's website at www.assetco.com. News updates, regulatory news, & financial statements can be viewed and downloaded from the Group's website, www.assetco.com  Copies can also be requested, in writing to, The Company Secretary, AssetCo plc, Singleton Court Business Park, Wonastow Road, Monmouth, Monmouthshire NP25 5JA.

Enquiries: AssetCo plc Tudor Davies, Chairman Tel: +44 (0) 7785 703523 or    +44 (0) 20 7614 5900
Arden Partners plc Nominated adviser and broker John Llewellyn-Lloyd/Ciaran Walsh Tel: +44 (0) 20 7614 5900
TooleyStreet Communications IR and media relations Fiona Tooley Mobile: +44 (0) 7785 703 523 fiona@tooleystreet.com

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