TIDMADA
RNS Number : 9106U
Adams PLC
28 November 2019
Adams plc
("Adams" or the "Company")
Interim Results for the Six Months ended 30 September 2019
Adams Plc ("Adams" or the "Company") experienced a challenging
six months to 30 September 2019 in terms of the performance of its
investment portfolio and as a result the Company incurred a loss
after tax of GBP46,000 during that period versus a profit after tax
of GBP517,000 earned in the six months ended 30 September 2018. The
reduction in profitability is principally due to lower investment
returns of only GBP23,000 compared to GBP598,000 in the previous
September 2018 half year.
During the six months ended 30 September 2019, the Company spent
GBP559,000 on 3 new equity investments and generated cash proceeds
of GBP579,000 from the realisation of its investment in Midatech
Pharma Plc. Adams held 6 investments at 30 September 2019, of which
5 were listed and 1 was un-listed, and for which the total
investment carrying value was GBP2.02 million (31 March 2019:
carrying value GBP2.08 million, represented by 3 listed and 1
un-listed investment holdings).
The Company held cash balances of GBP309,000 at 30 September
2019, compared to cash balances of GBP315,000 at the previous 31
March 2019 year end, and it had not drawn down any part of its GBP3
million unsecured loan facility at that date. Net assets
attributable to shareholders of Adams at 30 September 2019 were
GBP2.32 million (equivalent to 2.81 pence per share) versus GBP2.37
million (equivalent to 2.87 pence per share) at 31 March 2019.
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.
Investment Portfolio
The listed investments held by the Company at 30 September 2019
comprised Petrofac Limited ("Petrofac"), Eland Oil & Gas Plc
("Eland"), Diurnal Group PLC ("Diurnal"), Griffin Mining Limited
("Griffin") and Circassia Pharmaceuticals plc ("Circassia"). 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 six months ended 30 June 2019,
Petrofac reported a profit of US$135 million after tax on revenue
of US$2.82 billion. Net cash stood at US$69 million at 30 June
2019.
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. Eland's increasing production led to record
revenues of US$106.0 million in the six months to 30 June 2019 and
a resultant US$32.7 million post-tax profit for that period.
Diurnal is an AIM listed specialty pharmaceutical company
dedicated to developing high-quality hormone therapeutics to aid
lifelong treatment for rare and chronic endocrine conditions,
initially by developing and marketing products for the rare orphan
diseases congenital adrenal hyperplasia and adrenal insufficiency
including its Alkindi(R) and Chronocort(R) products. Initial
revenues grew to GBP1 million for the year ended June 2019, which
coupled with continued significant investment in research and
development and marketing, resulted in a loss after tax of GBP12.3
million for that year.
Griffin is an AIM listed mining and investment company that has
been the leader in foreign investment in mining in China having
been engaged in developing the Caijiaying zinc and gold project
since 1997. For the six months ended 30 June 2019, Griffin reported
a much reduced profit of US$4.1 million after tax on revenue of
US$38.6 billion, reflecting falling zinc metal prices and
significantly higher smelter treatment charges.
Circassia is an AIM listed specialty pharmaceutical company
focused on respiratory disease and which markets innovative asthma
management products including the chronic obstructive pulmonary
disease products Tudorza(R) and Duaklir(R) as well as the
ventilator-compatible novel nitric oxide NIOX(R) product. Revenues
amounted to GBP27.9 million for the six months ended 30 June 2019,
which coupled with continued significant investment in development
and marketing, resulted in an operating loss of GBP19.3 million for
that period.
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 period end investment transactions. Subsequent to 30
September 2019, Adams realised its investment in Eland in full,
generating investment disposal proceeds amounting to GBP328,000.
Together with other post 30 September 2019 cash flows, Adams
currently has cash balances of approximately GBP640,000, 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
There is continued reason for investment caution in the near
term, given that the global economy is slowing down as reflected by
falling GDP output in the US and China, coupled with near recession
conditions in Germany, Italy and the UK. The key threats to a
sustained global recovery include the continuing trade war between
the US and China, ongoing Brexit uncertainties and worldwide debt
to GDP ratios which are now at their highest levels since the
Second World War.
We will, therefore, continue to maintain a rigorous and highly
selective investment approach with a view to exploiting
opportunities as they emerge and we are confident that this
approach will enable us to build considerable value for
shareholders going forward.
Michael Bretherton
Chairman
27 November 2019
Enquiries:
Adams plc
Mike Bretherton Tel: +44 1534 719 761
Nomad
Cairn Financial Advisers LLP
Sandy Jamieson, James Caithie Tel: +44 207 213 0880
Broker
Peterhouse Corporate Finance Limited
Lucy Williams, Duncan Vasey Tel: +44 207 469 0930
STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTH PERIOD TO 30 SEPTEMBER 2019
6 months
6 months ended
ended Year ended 30 Sep
30 Sep 2019 31 Mar 2019 2018
Note (Unaudited) (Audited) (Unaudited)
GBP'000 GBP'000 GBP'000
(Loss)/gain on investments 5 (31) 317 541
Dividend income 54 87 57
-------------- ------------- ------------
Investment return 23 404 598
Expenses and other income
Administrative expenses (73) (172) (86)
Other income - 14 -
Operating (loss)/profit (50) 246 512
Interest income 4 11 5
(Loss)/profit before income tax (46) 257 517
Income tax expense - - -
(Loss)/profit and total comprehensive
-------------- ------------- ------------
(Loss)/income for the period (46) 257 517
============== ============= ============
Basic and diluted (loss)/earnings
per share 10 (0.06)p 0.31p 0.63p
-------------- ------------- ------------
There are no other items of comprehensive (loss)/income.
STATEMENT OF FINANCIAL POSITION
AS AT 30 SEPTEMBER 2019
As at As at As at
30 Sep 2019 31 Mar 2019 30 Sep 2018
(Unaudited) (Audited) (Unaudited)
Note GBP'000 GBP'000 GBP'000
Assets
Non-current assets
Investments 6 2,024 2,075 2,622
Current assets
Trade and other receivables 7 3 2 6
Cash and cash equivalents 309 315 30
------------- ------------- -------------
Current assets 312 317 36
------------- ------------- -------------
Total assets 2,336 2,392 2,658
------------- ------------- -------------
Liabilities
Current liabilities
Trade and other payables 8 (16) (26) (32)
------------- ------------- -------------
Total liabilities (16) (26) (32)
------------- ------------- -------------
Net current assets 296 291 4
------------- ------------- -------------
Net assets 2,320 2,366 2,626
============= ============= =============
Equity
Called up share capital 9 826 826 826
Accumulated gains 1,494 1,540 1,800
Total shareholder equity 2,320 2,366 2,626
============= ============= =============
STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTH PERIOD TO 30 SEPTEMBER 2019
Foreign
currency
Share Share translation Accumulated
Capital Premium reserve gains/(losses) Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 31 March 2018 (audited) 1,001 1,401 (244) (49) 2,109
--------- --------- ------------- ---------------- --------
Total comprehensive gain
for period - - - 517 517
Redenomination of share
capital (175) 175 - - -
Elimination of foreign currency
reserve - (244) 244 - -
Reclassification of share
premium - (1,332) - 1,332 -
At 30 September 2018 (unaudited) 826 - - 1,800 2,626
--------- --------- ------------- ---------------- --------
Total comprehensive loss
for period - - - (260) (260)
At 31 March 2019 (audited) 826 - - 1,540 2,366
--------- --------- ------------- ---------------- --------
Total comprehensive loss
for period - - - (46) (46)
At 30 September 2019 (unaudited) 826 - - 1,494 2,320
========= ========= ============= ================ ========
STATEMENT OF CASH FLOWS
FOR THE SIX MONTH PERIOD TO 30 SEPTEMBER 2019
6 months Year 6 months
ended ended ended
30 Sep 2019 31 Mar 2019 30 Sep 2018
(Unaudited) (Audited) (Unaudited)
GBP'000 GBP'000 GBP'000
(Loss)/profit for the period (46) 257 517
Unrealised loss/(gain) on revaluation
of investments 277 (174) (541)
Realised gain on disposal of investments (246) (143) -
(Increase)/decrease in trade and
other receivables (1) 5 (4)
(Decrease)/increase in trade and
other payables (10) - 11
Net cash outflows from operating
activities (26) (55) (17)
-------------- ------------- -------------
Cash flows from investing activities
Proceeds from sales of investments 579 529 -
Purchase of investments (559) (211) (5)
Net cash generated/(used) in investing
activities 20 318 (5)
-------------- ------------- -------------
Net (decrease)/increase in cash
and cash equivalents (6) 263 (22)
Cash and cash equivalents at beginning
of period 315 52 52
Cash and cash equivalents at end
of period 309 315 30
============== ============= =============
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTH PERIOD TO 30 SEPTEMBER 2019
The accounting policies and explanatory notes set out below from
an integral part of the financial statements.
1 General information
Adams Plc ("the Company") is a company incorporated in the Isle
of Man and is listed on the AIM market of the London Stock
Exchange.
2 Basis of preparation
The interim financial statements of Adams Plc are unaudited
condensed financial statements for the six months ended 30
September 2019. These include unaudited comparatives for the six
months ended 30 September 2018 together with audited comparatives
for the year ended 31 March 2019.
These interim condensed financial statements have been prepared
on the basis of the accounting policies expected to apply for the
financial year to 31 March 2020 which are based on the recognition
and measurement principles of International Financial Reporting
Standards (IFRS) as adopted by the European Union (EU). The
financial statements have been prepared under the historical cost
convention. The Company's presentation and functional currency is
GBP Pounds Sterling.
The interim financial statements do not include all of the
information required for full annual financial statements and do
not comply with all the disclosures in IAS 34 'Interim Financial
Reporting', and should be read in conjunction with the Company's
annual financial statements to 31 March 2019. Accordingly, whilst
the interim statements have been prepared in accordance with IFRS,
they cannot be construed as being in full compliance with IFRS.
The preparation of financial statements in conformity with IFRS
as adopted by the EU requires the use of certain critical
accounting estimates. It also requires management to exercise its
judgement in the process of applying the Company's accounting
policies.
3 Going concern
Information on the business environment, financial position and
the factors underpinning the Company's future prospects and
portfolio are included in the Chairman's Statement. The Directors
confirm that they are satisfied that the Company has adequate
financial resources to continue in business for the foreseeable
future based on the current liquid resources available. For this
reason, they continue to adopt the going concern basis in preparing
the financial statements.
4 Significant accounting policies
The accounting policies adopted are consistent with those
followed in the preparation of the annual financial statements of
Adams Plc for the year ended 31 March 2019 which received an
unqualified audit opinion. A copy of these financial statements is
available on the Company website at www.adamsplc.co.uk.
5 Segment reporting
Operating segments for Adams Plc are reported based on the
financial information provided to the Board, which is used to make
strategic decisions. The Directors are of the opinion that under
IFRS 8 'Operating segments' the Company has only one reportable
segment, being Investment Return. The Board assesses the
performance of the operating segment based on financial information
which is measured and presented in a manner consistent with that in
the financial statements.
The principal sources of revenue for the Company in the period
to 30 September 2019 were as follows:
6 months 6 months
ended 30 Year ended ended 30
Sep 2019 31 Mar 2019 Sep 2018
GBP'000 GBP'000 GBP'000
Unrealised (loss)/gain on
investments (277) 174 541
Realised gains on investments 246 143 -
------------------- ------------------- -------------------
Total (loss)/gain on investments (31) 317 541
=================== =================== ===================
6 Investments
An analysis of movements in the value of the Company's
investments is as follows:
Quoted Unquoted
Equity Equity Unquoted
Shares Shares Loan Notes Total
GBP'000 GBP'000 GBP'000 GBP'000
Fair value at 31 March 2018 1,968 5 103 2,076
Additions at cost - - 5 5
Unrealised revaluation gains 541 - - 541
-------- --------- ------------ --------
Fair value at 30 September 2018 2,509 5 108 2,622
Additions at cost 200 - 6 206
Disposals (386) - - (386)
Unrealised revaluation loss (367) - - (367)
-------- --------- ------------ --------
Fair value at 31 March 2019 1,956 5 114 2,075
Additions at cost 555 - 4 559
Disposals (333) - - (333)
Unrealised revaluation loss (277) - - (277)
-------- --------- ------------ --------
Fair value at 30 September 2019 1,901 5 118 2,024
======== ========= ============ ========
7 Trade and other receivables
As at As at As at
30 Sep 2019 31 Mar 2019 30 Sep 2018
GBP'000 GBP'000 GBP'000
Prepayments 3 2 6
------------------- ------------------- -------------------
3 2 6
=================== =================== ===================
The carrying amount of prepayment is approximate to their fair
value.
8 Trade and other payables
As at As at As at
30 Sep 2019 31 Mar 2019 30 Sep 2018
GBP'000 GBP'000 GBP'000
Trade payables 11 11 13
Accruals and other creditors 5 15 19
16 26 32
============= =================== ===================
The carrying amount of trade and other payables approximates to
their fair value.
9 Share capital and share premium
Number of
shares issued Share Share
and fully capital premium
Ordinary shares paid up GBP'000 GBP'000
At 1 April 2018 82,553,232 1,001 1,401
--------------- --------- ---------
Redenomination of share capital - (175) 175
Elimination of foreign currency
reserve - - (244)
Reclassification of share
premium - - (1,332)
At 30 September 2018 82,553,232 826 -
--------------- --------- ---------
Issue of shares - - -
At 31 March 2019 82,553,232 826 -
--------------- --------- ---------
Issue of shares - - -
At 30 September 2019 82,553,232 826 -
--------------- --------- ---------
On 10 August 2018, a special resolution was passed authorising
the par value of the Company's Ordinary Shares to be redenominated
from EUR0.01 to GBP0.01. On that same date, resolutions were also
passed that GBP244,000 of share premium be cancelled and applied to
eliminate the Foreign Currency Translation Reserve and that the
remaining balance on the Company's share premium account be
reclassified as distributable reserves.
The authorised Ordinary share capital of the Company at 30
September 2019, 31 March 2019 and 30 September 2018 is 350,000,000
Ordinary Shares of GBP0.01.
10 (Loss)/earnings per share
The basic (loss)/earnings per share is calculated by dividing
the (loss)/profit after tax attributable to equity shareholders by
the weighted average number of Ordinary Shares in issue during the
period:
6 months Year 6 months
ended ended ended
30 Sep 2019 31 Mar 2019 30 Sep 2018
(Loss)/profit after tax attributable
to equity holders of the Company
(GBP'000) (46) 257 517
Weighted average number of Ordinary
Shares 82,553,232 82,553,232 82,553,232
Basic and diluted (loss)/earnings
per share (0.06)p 0.31p 0.63p
There were no potentially dilutive shares in issue as at 30
September 2019, 31 March 2019 and 30 September 2018.
11 Events after reporting date
Following the 30 September 2019 half year end, the Company
disposed of its entire remaining holding of 199,911 shares in Eland
Oil & Gas Plc for a cash consideration of GBP328,000.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
IR DDLFLKFFZFBL
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