Newmarket Investments Plc (`Newmarket' or the `Company')
Preliminary Statement for the year ended 31 March 2008
Chairman's statement
Highlights
* The Company's shares were admitted to trading on AIM 18 March 2008
following the acquisition of International Racing Bureau Limited which
constituted a reverse transaction under the AIM Rules
* Revenues for the 12 months to 31 March 2008 �230,762 (2007: 162,597)
* Loss per share for the 12 months to 31 March 2008 2.28 pence (2007: Loss
per share 3.47 pence)
* Total equity as at 31 March 2008 �1.2 million (2007: deficit �0.3 million)
* Cash and cash equivalents as at 31 March 2008 �334,071 (2007: �73,739)
Introduction
Since the last annual report your board has continued to develop the Company's
activities.
BBA Insurance Services continues to grow thanks to the efforts of James Van
Praagh, whilst the policy holders and clients of Equine Risk Management have
been successfully retained by BBAIS.
During the past year, the Company has, for the time being, ceased to trade in
bloodstock nominations, following a number of years of no growth and limited
opportunity. Whilst this has reduced gross income, it has also reduced costs.
Your board will continue to examine future opportunities in the bloodstock
market, but will only re-enter the business if it believes there is a viable
business opportunity.
Acquisitions
I am pleased to report the successful refinancing of the Company and the
subsequent completion of the acquisition of the International Racing Bureau
Limited (IRB) which constituted a reverse take-over pursuant to the AIM Rules.
This has firmly re-established the Company in the horse racing world.
Nevertheless the board continues to examine other opportunities for
acquisition. The challenge for the management of the Company remains the
further integration of the businesses and the exploitation of the brands,
whilst seeking new customers and increased Revenue.
The property acquisition anticipated in the last report was successfully
completed. The board envisages that the property will be sold to provide
further working capital.
Share capital reorganisation
The share capital reorganisation was also successfully completed.
Board Changes
During the period, Jonathan Cohen has joined the board with responsibility for
finance and we have also been pleased to appoint Ross Jones with his wide range
of experience in both sport and financial institutions. I thank them for their
efforts.
Conclusion
Despite the present economic environment, your board believes that it can
continue to grow the business by organic growth and by acquisition and will
continue to seek opportunities to do so, whilst at the same time retaining a
tight control on costs.
John Carrington
Chairman
Consolidated Income Statement for the year ended 31 March 2008
Year ended Year ended
31 March 31 March
2008 2007
� �
Continuing operations
Revenue 243,766 162,597
Cost of sales (2,060) -
Gross profit 241,706 162,597
Administrative expenses (619,530) (427,600)
Other operating income - (8,750)
Operating profit (377,824) (273,753)
Finance income 502 187
Amounts written off investments - (28,111)
Finance costs (23,734) (2,310)
Loss before taxation (401,056) (303,987)
Taxation (3,248) -
Loss for the period (404,304) (303,987)
Loss per share - basic and diluted (2.28)p (3.40)p
Statement of Changes in Shareholders' Equity for the year ended 31 March 2008
Share Share Capital Profit and Total
capital premium redemption loss
reserve account
� � � � �
Balance at 1 April 2006 2,187,500 116,601 579,552 (2,855,787) 27,866
Loss for the period - - - (303,987) (303,987)
Balance at 31 March 2,187,500 116,601 579,552 (3,159,774) (276,121)
2007
Balance at 1 April 2007 2,187,500 116,601 579,552 (3,159,774) (276,121)
Issue of shares 23,391 1,753,770 - - 1,777,161
Loss for the year - - - (404,304) (404,304)
Balance at 30 June 2007 2,210,891 1,870,371 579,552 (3,564,078) 1,096,736
Consolidated Balance Sheet as at 31 March 2008
2008 2007
� �
ASSETS
Non current assets
Intangible asset 837,914 -
Property plant and equipment 309,943 11,998
Financial assets: available-for-sale 1,079 1,079
investments
1,148,936 13,077
Current assets
Trade and other receivables 468,014 232,045
Cash and cash equivalents 334,071 73,739
802,085 305,784
Total assets 1,951,021 318,861
LIABILITIES
Current liabilities
Interest bearing loans and borrowings (184,753) (129,394)
Trade and other payables (669,532) (465,588)
Total current liabilities (854,285) (594,982)
Total assets less current liabilities 1,096,736 (276,121)
EQUITY
Called up share capital 2,210,891 2,187,500
Share premium account 1,870,371 116,601
Capital redemption reserve 579,552 579,552
Profit and loss account (3,564,078) (3,159,774)
Total equity 1,096,736 (276,121)
Consolidated Cash Flow statement for the year ended 31 March 2008
2008 2007
� �
Cash flows from operating activities
Operating loss (377,824) (273,753)
Depreciation of property plant and equipment 4,265 5,963
Loss on sale of property plant and equipment (180) -
Profit on disposal of investments - 8,750
Decrease/(increase) in trade and other 19,335 (57,287)
receivables
Increase in trade and other payables 223,812 204,858
Cash used in operations (130,592) (111,469)
Finance income 502 187
Finance cost (23,734) (2,310)
Net cash used in operating activities (153,824) (113,592)
Cash flow from investing activities
Receipts from sales of property plant and 2,016 -
equipment
Purchase of subsidiary undertakings (net of (475,830) -
cash acquired)
Net cash used in investing activities (473,814) -
Cash flow from financing activities
Proceeds from share issue (net of issue costs) 753,070 -
Other new short term loans 104,795 65,000
Net cash flow generated from financing 857,865 65,000
activities
Net increase/(decrease) in cash and cash 230,227 (48,595)
equivalents
Cash and cash equivalents at start of period 9,345 57,937
Cash and cash equivalents at end of period 239,572 9,345
Notes to the preliminary results for the year ended 31 March 2008
1 Basis of preparation
The financial information in this preliminary announcement does not constitute
the company's statutory accounts for the years ended 31 March 2008 or 31 March
2007, but is derived from those accounts. The statutory accounts for 2007,
which were prepared under UK GAAP, have been delivered to the Registrar of
Companies and those for 2008, prepared in accordance with International
Financial Reporting Standards as adopted by the European Union (`IFRSs'),
International Financial Reporting Interpretations Committee (`IFRIC') and the
Companies Act 1985 applicable to companies reporting under IFRS, will be
delivered. The auditors reports on the accounts for both years were unqualified
and did not contain statements under the Companies Act 1985 section 237 (2) or
(3).
This is the first time that the Group has prepared its financial statements in
accordance with IFRS, having previously prepared in accordance with UK
Generally Accepted Accounting Practice (UK GAAP). The transition to IFRS has
had no effect on the loss, net assets and cash flow previously reported under
UK GAAP. The only changes that have been made are presentational.
The company has taken advantage of certain exemptions available under IFRS 1
'First time adoption of International Financial Reporting Standards'. The
financial statements have been prepared on the basis of the following
exemptions:
- Business combinations prior to April 2006 have not been restated to comply
with IFRS 3 Business Combinations.
- The Group has applied IFRS 2 Share-based payments exemption to those equity
settled awards that were granted on or before 2 November 2002.
The preparation of financial statements, in conformity with general accepted
accounting principles under IFRS, requires management to make 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 reported period. Although these estimates are based on
management's best knowledge of the amounts, events or actions, actual results
may ultimately differ from those estimates. The accounting policies have been
applied consistently throughout the Group for the purposes of preparation of
these financial statements.
2 Income tax expense
2008 2007
� �
Income tax expense
Current tax:
UK corporation tax 2,523 -
Current tax charge 2,523 -
Deferred tax
Deferred tax adjustment for prior period 725 -
3,248 -
Loss before taxation (401,056) (303,987)
Loss before taxation multiplied by standard
rate of UK
corporation tax of 30% (2007 - 30%) (120,317) (91,196)
Effects of:
Non-deductible-expenses 2,740 33,417
Depreciation in excess of capital allowances (162) (780)
Tax losses 120,262 58,559
122,840 91,196
Current tax charge 2,523 -
The directors estimate that there is �1.9 million (2007 - �1.6 million) of
trading losses to carry forward to utilise against future trading profits and �
305,000 of capital losses available for offset against future capital gains.
3 Earnings per share
The earnings and number of shares used in the calculation of earnings per
ordinary share are set out below:
Basic and diluted 2008 2007
Loss for the year (404,304) (303,987)
Weighted average number of shares in 17,721,856 8,750,000
issue for the year
Loss per share (2.28)p (3.47)p
There was no dilutive effect from the share options outstanding during the
year. The share re-organisation had no effect on the comparative loss per share
for 2007
4 Dividends
No dividends were paid or proposed in respect of the year ended 31 March 2008
(2007 - �nil)
5 Copies of the reports and accounts
Copies of the Report and Accounts will be sent to shareholders on 30 September
2008 and will be available to members of the public from the Company's
registered office 25 Manchester Square, London W1U 3PY and at the Company's
website www.newmarketinvestmentplc.com.
For further information please contact:-
Newmarket Investments plc
Jonathan Cohen
Finance director
Tel: 020 7486 8985
Nominated Adviser
Dowgate Capital Advisers Limited
Liam Murray
Tel: 020 7492 4777
Broker
Dowgate Capital Stockbrokers Limited
Neil Badger
Tel: 01293 517 744
END
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