TIDMADA
RNS Number : 2700E
Adams PLC
03 July 2019
3 July 2019
Adams Plc
("Adams" or the "Company")
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEARED 31 MARCH
2019
Adams Plc presents its annual report and audited financial
results for the year ended 31 March 2019.
Highlights:
- Net assets at 31 March 2019 of GBP2.37 million (2018: GBP2.11 million).
- Net assets per share 2.87 pence at 31 March 2019 (2018: 2.55 pence).
- Profit after tax of GBP0.26 million (2018: profit of GBP0.18 million).
- Investments at 31 March 2019 valued at GBP2.08 million (2018: GBP2.08 million).
- Spend on new investments of GBP0.21 million (2018: GBP1.59 million).
- Investment realisation proceeds of GBP0.53 million (2018: GBP0.73 million).
- Secured GBP3.00 million loan facility of which no part drawn down to date.
Michael Bretherton, Chairman, said:
"The Board continues to seek attractive investment opportunities
coupled with a focus on financial discipline as the strategy to
best navigate challenging markets and the uncertain global climate.
We remain committed to delivering additional value for our
shareholders going forward."
The Company's 2019 Annual Report will shortly be posted to
shareholders together with a Notice of Annual General Meeting,
copies of which will be made available on the Company's website at
www.adamsplc.co.uk under the Investor Relations / Company &
Shareholder Documents section. The Annual General Meeting is to be
held at 11.00 a.m. on Friday 9 August 2019 at IOMA House, Hope
Street, Douglas, Isle of Man, IM1 1AP.
Enquiries:
Adams Plc Michael Bretherton Tel: +44 1534 719 761
Nomad Cairn Financial Advisers LLP. Sandy Jamieson, James
Caithie Tel: +44 207 213 0880
Broker Peterhouse Capital Limited. Heena Karani Tel: +44 207 469
3393
Chairman's Statement
Adams Plc ("Adams" or the "Company") reported a profit after tax
of GBP257,000 for the year ended 31 March 2019 compared to a profit
of GBP180,000 in the prior year. The increase in profitability is
principally due to higher reported gains on the valuation of
investments.
During the year, the Company spent GBP0.21 million on the
purchase of additional investments and realised proceeds of GBP0.53
million from investment disposals. The carrying value of
investments at 31 March 2019 was GBP2.08 million, represented by 3
listed and 1 un-listed investment holding, which was in line with
the prior year end carrying value of GBP2.08 million as represented
by 3 listed and 3 un-listed investment holdings at 31 March
2018.
Net assets increased to GBP2.37 million (equivalent to 2.87
pence per share) at the 31 March 2019 balance sheet date, compared
with GBP2.11 million (equivalent to 2.55 pence per share) at the
previous year end. The increase in net assets fully reflects the
profit reported for the year.
Cash and cash equivalent balances were GBP315,000 at 31 March
2019 compared to cash balances of GBP52,000 at 31 March 2018.
Business model and investing policy
Adams is an investing company with an investing policy under
which the Board is seeking to acquire interests in special
situation investment opportunities that have an element of
distress, dislocation, dysfunction or other special situation
attributes and that the Board perceives to be undervalued. The
principal focus is in the small to middle-market capitalisation
sectors in the UK or Europe, but the directors will also consider
possible special situation opportunities anywhere in the world if
they believe there is an opportunity to generate added value for
shareholders.
Loan Facility
On 29 January 2019, Adams announced that, in support of its
investment strategy, the Company had entered into an agreement with
Adams's largest shareholder, Richard Griffiths, and his controlled
company, Blake Holdings Limited, for the provision of an unsecured
loan facility of up to GBP3 million in total. The Company believes
there is potential to yield increased investment returns if Adams
has access to such further cash resources to finance additional
special situation investment opportunities.
This loan facility may be drawn down by the Company in minimum
tranches of GBP500,000 and has no fixed term but is repayable in
full or in part six months after any repayment notice issued by
either the lender or the Company. Interest accrues daily based on a
rate of 7 per cent. per annum and is paid six monthly in arrears.
No arrangement, commitment or exit fees have or will be
charged.
No part of this loan facility has been drawn down to date.
Investment Portfolio
The listed investments held by the Company at 31 March 2019
comprised Petrofac Limited ("Petrofac"), Eland Oil & Gas Plc
("Eland"), and Midatech Pharma Plc ("Midatech"). In addition, the
Company holds shares and loan notes in unquoted Sherwood Holdings
Limited which has Source Bioscience Limited ("Source Bioscience")
as its principal subsidiary company asset.
Petrofac is listed on the Main Market of the London Stock
Exchange and is a multinational service provider to the oil and gas
production and processing industry. The company, which has 31
offices and approximately 13,500 staff worldwide, designs, builds,
operates and maintains oil and gas facilities with a focus on
delivering first class project execution, cost control and
effective risk management. For the year ended 31 December 2018,
Petrofac reported a profit of US $350 million after tax before
exceptional items, on revenue of US $5.83 billion. During that
period, the company incurred exceptional costs of US $289 million
on mainly the write down of an installation vessel following the
decision to exit the deep-water market, together with a further
write down of its interests in Mexico and the Greater Stella Area
development, both of which are in the process of disposal, and
which resulted in a reported overall profit after tax for the year
of US $61 million.
Eland is an AIM listed independent oil and gas company focused
on production and development in principally the Niger Delta in
West Africa where, through its joint venture company Elcrest
Exploration and Production Nigeria Ltd, it has acquired a number of
oil field licenses. Since acquiring its Opuama oil field, Eland has
successfully redeveloped this asset with first production oil
commencing in February 2014 from the recommissioning of two
existing wells. The company subsequently brought two further wells
onstream, resulting in an all-time production high in 2018. Eland's
increasing production has led to growing revenues of US $169.2
million for the year to 31 December 2018 and a resultant US $148.0
million post-tax profit in that period.
Midatech is an AIM listed company focussed on improved
bio-delivery and bio-distribution of medicines or agents to areas
of the body where they are most needed and can exert their actions
in an effective, safe and precise manner in order to extend the
lives of patients with rare and serious cancers.
Source Bioscience is a private company that is an international
provider of state-of-the art laboratory services and products and
has an expertise in clinical diagnostics, genomics, proteomics,
drug discovery & development research and analytical testing
services.
Post year end investment transactions. Subsequent to the
Company's 31 March 2019 year end, Adams realised its investment in
Midatech in full, generating investment disposal proceeds amounting
to GBP580,000. Adams also made a new investment of GBP233,000 in a
UK-based AIM listed specialty pharmaceutical company dedicated to
developing high-quality hormone therapeutics to aid lifelong
treatment for rare and chronic endocrine conditions, as well as a
new investment of GBP195,000 in an AIM listed mining company with
principal interests in China. Together with other cash flows, Adams
currently has cash balances of approximately GBP479,000, in
addition to an unused loan facility of GBP3.0 million, available
for further investment as and when the directors identify
appropriate attractive opportunities to exploit.
Outlook
Expansion of the world economy is continuing to lose momentum
and growth forecasts have been revised downwards in almost all G20
economies, with particularly large revisions in the euro area for
both 2019 and 2020. Ongoing trade tensions between the US and
China, Brexit uncertainties and a further erosion of business and
consumer confidence are all contributing to the slowdown.
Consequently, your Board will continue to maintain a rigorous and
highly selective investment approach, coupled with a focus on
financial discipline, as the best strategy to navigate these
challenging markets and the uncertain global climate.
We remain confident in the underlying fundamentals, technologies
and long-term potential for growth at the companies within our
investment portfolio and are committed to delivering additional
value for shareholders going forward.
Michael Bretherton
Chairman
2 July 2019
Statement of Comprehensive Income Year ended Year ended
31 March 2019 31 March 2018
GBP'000 GBP'000
---------------------------------------------------- ---- --------------- ----------------
Dividend income 87 45
Gain on investments 317 280
---------------------------------------------------------- --------------- ----------------
Investment return 404 325
Expenses and other income
Administrative expenses
Other income (172) (155)
14 -
--------------------------------------------------------- --------------- ----------------
Operating profit 246 170
Interest income 11 10
---------------------------------------------------------- --------------- ----------------
Profit before income tax 257 180
Income tax expense - -
---------------------------------------------------- ---- --------------- ----------------
Profit and total comprehensive profit for the year 257 180
---------------------------------------------------------- --------------- ----------------
Basic and diluted earnings per share 0.31p 0.25p
---------------------------------------------------------- --------------- ----------------
Statement of Financial Position at 31 March 2019
31 March
31 March 2019 2018
GBP'000 GBP'000
--------------------------------------- --------------- -----------
Assets
Non-current assets
Investments 2,075 2,076
----------------------------------------- -------------- -----------
Current assets
Prepayments 2 2
Cash and cash equivalents 315 52
----------------------------------------- -------------- -----------
Current assets 317 54
----------------------------------------- -------------- -----------
Total assets 2,392 2,130
----------------------------------------- -------------- -----------
Liabilities
Current liabilities
Trade and other payables (26) (21)
----------------------------------------- -------------- -----------
Total liabilities (26) (21)
----------------------------------------- -------------- -----------
Net current assets 291 33
----------------------------------------- -------------- -----------
Net assets 2,366 2,109
----------------------------------------- -------------- -----------
Equity
--------------------------------------- -------------- -----------
Called up share capital 826 1,001
Share premium - 1,401
Foreign currency translation reserve - (244)
Retained earnings / (deficit) reserve 1,540 (49)
----------------------------------------- -------------- -----------
Total shareholder equity 2,366 2,109
----------------------------------------- -------------- -----------
Statement of Changes in Equity as at 31 March 2019
Share Foreign currency Retained earnings /
Share Capital Premium translation reserve (deficit) reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 April 2017 636 783 (244) (229) 946
Changes in equity
Issue of shares 365 618 - - 983
Total comprehensive gain - - - 180 180
-------------------------- -------------- --------- -------------------------- ------------------------- --------
At 31 March 2018 1,001 1,401 (244) (49) 2,109
-------------------------- -------------- --------- -------------------------- ------------------------- --------
Changes in equity
Redenomination of share
capital (175) 175 - - -
Elimination of foreign
currency reserve - (244) 244 - -
Reclassification of share
premium - (1,332) - 1,332 -
Total comprehensive gain - - - 257 257
-------------------------- -------------- --------- -------------------------- ------------------------- --------
At 31 March 2019 826 - - 1,540 2,366
-------------------------- -------------- --------- -------------------------- ------------------------- --------
Statement of Cash Flows for the year ended 31 March 2019
Year ended Year ended
31 March 2018
31 March 2019 *Restated
GBP'000 GBP'000
Profit for the year 257 180
Unrealised gain on revaluation of portfolio investments (174) (237)
Realised gain on disposal of portfolio investments (143) (43)
Increase / (decrease) in trade and other payables 5 (5)
-------------------------------------------------------------------- -------------- --------------
Net cash outflow from operating activities (55) (105)
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Cash flows from investing activities
Purchase of portfolio investments (211) (1,591)
Proceeds from sales of investments 529 730
-------------------------------------------------------------------- -------------- --------------
Net cash generated / (used) in investing activities 318 (861)
-------------------------------------------------------------------- -------------- --------------
Cash flows from financing activities
Issue of ordinary share capital - 983
Net cash generated from financing activities - 983
-------------------------------------------------------------------- -------------- --------------
Net increase in cash and cash equivalents 263 17
Cash and cash equivalents at beginning of year 52 35
-------------------------------------------------------------------- -------------- --------------
Cash and cash equivalents at end of year 315 52
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END
FR CKBDBABKDFOK
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