Playgolf (Holdings) PLC
29 September 2006
PLAYGOLF (HOLDINGS) PLC ('PLAYGOLF' or the 'COMPANY')
INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2006
CHIEF EXECUTIVE'S REVIEW
Turnover has grown significantly from the corresponding period in 2005 (2005:
£1.123million; 2006: £1.529 million) and this reflects the opening of the
Company's flagship facility at Northwick Park. Losses in the corresponding
period have widened as anticipated in the year end report of 2005 (2005:
£0.317million; 2006: £1.19 million) and this reflects the early trading losses
which we will have to carry while Northwick Park is in its maiden year. The
facility continues to attract widespread acclaim both from the industry and
customers and the business is growing steadily.
The Company has made the operational adjustments at Playgolf Manchester that we
signalled in the 2005 report and these have brought significant cost savings as
hoped. The benefit of these will be felt in the final quarter and we expect to
implement similar changes at Playgolf Metro before the end of the year.
Playgolf East Kilbride has attracted interest from a number of potential
tenants. We are considering the two options of either forward funding the
development or entering into a joint venture to develop the scheme with a third
party. It is considered that either of these options could provide the Company
with short term cash benefits and enable the Company to accelerate the strategic
objective of developing further multi sports facilities.
Sport has never been higher on the UK's agenda and the commercial opportunity
this presents is one which the company is well placed to benefit from. Our
target is to establish a Playgolf multi sport facility in each of the major
cities in the UK. We are therefore continuing the process of streamlining our
operational activities which will allow us to focus the majority of our effort
and resource on new developments.
David Piggins
Chief Executive
27 September 2006
CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE PERIOD ENDED 30 JUNE 2006
Period to Period to Year ended
30 June 30 June 31 December 2005
2006 2005 2005
£'000 £'000 £'000
Note Unaudited Unaudited Audited
As restated As restated
TURNOVER
- continuing operations 1,457 872 1,856
- discontinued operations 72 251 535
--------------- ------------- ------------
1,529 1,123 2,391
Cost of sales (899) (552) (1,180)
--------------- ------------- ------------
GROSS PROFIT 630 571 1,211
Administrative expenses (1,406) (782) (1,915)
--------------- -------------- ----------------
OPERATING LOSS
- continuing operations (763) (219) (737)
- discontinued operations (13) 8 33
--------------- ------------- ------------
(776) (211) (704)
Loss on disposal of subsidiary 4 (43) - -
Net interest payable (371) (106) (276)
---------------- --------------- ---------------
LOSS ON ORDINARY ACTIVITIES
BEFORE TAXATION (1,190) (317) (980)
Tax on ordinary activities 2 - - -
--------------- ------------- --------------
LOSS ON ORDINARY ACTIVITIES
AFTER TAXATION (1,190) (317) (980)
--------------- ------------- -------------
RETAINED LOSS FOR THE PERIOD (1,190) (317) (980)
=============== ============= =============
Earnings per share - basic 3 (2.1)p (0.7)p (1.8)p
=============== ============= =============
CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
FOR THE SIX MONTHS ENDED 30 JUNE 2006
Period to Period to Year ended
30 June 30 June 31 December 2005
2006 2005 2005
£'000 £'000 £'000
Note Unaudited Unaudited Audited
LOSS FOR THE FINANCIAL PERIOD (1,190) (317) (980)
Unrealised surplus on
revaluation of leasehold
properties 7 381 - 5,087
--------------- ------------- -------------
Total recognised gains
and losses relating to
the period (809) (317) 4,107
=============== ============= =============
CONSOLIDATED BALANCE SHEET
AT 30 JUNE 2006
As at As at As at
30 June 30 June 31 December
2006 2005 2005
£'000 £'000 £'000
Note Unaudited Unaudited Audited
FIXED ASSETS
Intangible assets - Goodwill - 6 -
Tangible assets 5 21,915 12,940 21,661
--------------- ------------- -------------
21,915 12,946 21,661
CURRENT ASSETS
Stock 34 48 46
Debtors 431 609 640
Cash at bank and in hand 241 988 470
--------------- --------------- ---------------
706 1,645 1,156
CREDITORS: amounts falling due
within one year (983) (820) (1,113)
--------------- --------------- ---------------
NET CURRENT
(LIABILITIES)/ASSETS (277) 825 43
--------------- --------------- ---------------
TOTAL ASSETS LESS CURRENT
LIABILITIES 21,638 13,771 21,704
CREDITORS: amounts falling
due after one year (10,115) (7,399) (10,039)
--------------- --------------- ---------------
NET ASSETS 11,523 6,372 11,665
=============== =============== ===============
CAPITAL AND RESERVES
Called up share
capital 6 116 96 106
Share premium account 7 3,132 1,616 2,475
Merger reserve 7 467 467 467
Revaluation reserve 7 9,737 4,847 9,753
Other reserves 7 400 400 400
Profit and loss account 7 (2,329) (1,054) (1,536)
--------------- --------------- ---------------
EQUITY SHAREHOLDERS' FUNDS 11,523 6,372 11,665
=============== =============== ===============
CONSOLIDATED CASH FLOW STATEMENT
FOR THE SIX MONTHS ENDED 30 JUNE 2006
Period to Period to Year ended
30 June 30 June 31 December
2006 2005 2005
£'000 £'000 £'000
Unaudited Unaudited Audited
Operating loss (776) (211) (704)
Depreciation and amortisation 210 86 226
Decrease/(increase) in stock 1 (7) (5)
Decrease/(increase) in debtors 52 (376) (407)
(Decrease)/increase in creditors (134) 158 486
--------------- --------------- ---------------
NET CASH OUTFLOW FROM
OPERATING ACTIVITES (647) (350) (404)
RETURNS ON INVESTMENT AND
SERVICING OF FINANCE
Interest received 15 12 22
Interest paid (386) (118) (298)
--------------- --------------- ---------------
NET CASH OUTFLOW FROM
RETURNS ON INVESTMENT AND
SERVICING OF FINANCE (371) (106) (276)
CAPITAL EXPENDITURE AND
FINANCIAL INVESTMENT
Purchase of tangible
fixed assets (428) (2,596) (6,364)
--------------- --------------- ---------------
NET CASH OUTFLOW FROM INVESTING
ACTIVITIES (428) (2,596) (6,364)
ACQUISITIONS AND DISPOSALS
Sale of subsidiary
undertaking 426 - -
Net cash transferred
with subsidiary
undertaking (14) - -
--------------- --------------- ---------------
NET CASH INFLOW FROM AQUISITIONS
AND DISPOSALS 412 - -
--------------- --------------- ---------------
NET CASH OUTFLOW
BEFORE FINANCING (1,034) (3,052) (7,044)
FINANCING
Issue of ordinary
share capital (net of
issue costs) 667 - 869
Long term loans
received 76 2,719 5,359
--------------- --------------- ---------------
DECREASE IN CASH IN THE PERIOD (291) (333) (816)
=============== =============== ===============
NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT
FOR THE PERIOD ENDED 30 JUNE 2006
Period to Period to Year ended
30 June 30 June 31 December
2006 2005 2005
£'000 £'000 £'000
Unaudited Unaudited Audited
Decrease in cash in the period (291) (333) (816)
Cash inflow from increase in debt (76) (2,719) (5,359)
--------------- --------------- ---------------
Movement in the period (367) (3,052) (6,175)
Net debt at the beginning of the period (9,603) (3,428) (3,428)
--------------- --------------- ---------------
Net debt at the end of the period (9,970) (6,480) (9,603)
=============== =============== ===============
ANALYSIS OF NET DEBT
Bank loans (10,115) (7,399) (4,680)
Cash in hand and at bank 241 988 1,284
Overdrafts (96) (69) (32)
--------------- --------------- ---------------
(9,970) (6,480) (3,428)
=============== =============== ===============
RECONCILIATION OF MOVEMENTS IN GROUP SHAREHOLDERS' FUNDS
FOR THE PERIOD ENDED 30 JUNE 2006
Period to Period to Year ended
30 June 30 June 31 December
2006 2005 2005
£'000 £'000 £'000
Unaudited Unaudited Audited
Loss for the financial period (1,190) (317) (980)
Other gains and losses 381 - 5,087
--------------- --------------- ---------------
(809) (317) 4,107
New shares issued (net of issue costs) 667 - 869
--------------- --------------- ---------------
Net movement in shareholders' funds (142) (317) 4,976
Opening shareholders' funds 11,665 6,689 6,689
--------------- --------------- ---------------
Closing shareholders' funds 11,523 6,372 11,665
=============== =============== ===============
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2006
1. ACCOUNTING POLICIES
Basis of preparation
The financial information is prepared on the historical cost basis modified to
include the revaluation of land and buildings in accordance with the applicable
accounting standards.
It comprises the consolidated financial information of Playgolf (Holdings) Plc
and its subsidiaries.
The information set out in this interim report for the six months ended 30 June
2006 does not comprise statutory accounts within the meaning of section 240 of
The Companies Act 1985.
The results of subsidiaries acquired are accounted for from the effective date
of acquisition, using the acquisition method. The financial information does not
include the results regarding the 50% shareholding in Calverley (2004) Limited,
due to the sale of this investment to H.L.W. Fox and D.A.C. Piggins on 14 June
2004 in exchange for deferred consideration of £50,000.
Intangible assets - goodwill
Goodwill arising on the acquisition of subsidiary undertakings, representing any
excess of the fair value of the consideration given over the fair value of the
identifiable assets and liabilities acquired, is capitalised and written off on
a straight line basis over its useful economic life, which is 20 years.
Provision is made for any impairment.
Tangible fixed assets
Leasehold land and buildings are stated at valuation, net of depreciation and
any provision for impairment. The Group has a policy of revaluing all leasehold
property, by an external valuer, upon acquisition and on completion of
construction. Thereafter, the valuation will be performed annually by the
directors and externally at least every five years.
Other tangible fixed assets are stated at cost, net of depreciation and any
provision for impairment. Depreciation is provided on all tangible fixed assets,
once completed, at rates calculated to write off the cost, less estimated
residual value, of each asset on a straight-line basis over its expected useful
life, as follows:
Leasehold land and buildings over the shorter of the lease term and 50 years
Other assets 20 -33% straight line
Stock
Stock represents goods for resale and is stated at the lower of cost and net
realisable value.
Deferred Taxation
Deferred tax is recognised in respect of all timing differences that have
originated but not reversed at the balance sheet date where transactions or
events that result in an obligation to pay more tax in the future or a right to
pay less tax in the future have occurred at the balance sheet date. Timing
differences between the Group's taxable profits and its results as stated in the
financial statements that arise from the inclusion of gains and losses in tax
assessments in periods different from those in which they are recognised in the
financial statements.
Turnover
Turnover represents amounts receivable for goods and services net of VAT.
Leases
Rentals applicable to operating leases where substantially all of the benefits
and risks of ownership remain with the lessor are charged to the profit and loss
account as incurred.
2. TAXATION
There is no tax charge for the period to 30 June 2006 due to the trading losses
incurred.
3. EARNINGS PER SHARE Period to Period to Year ended
30 June 30 June 31 December
2006 2005 2005
£'000 £000 £'000
The calculations for earnings per
share are based on the following losses
and numbers of shares:
Loss for the period (1,190) (317) (980)
=============== =============== ===============
Weighted average number of shares Number Number Number
For basic earnings per share 56,581,348 47,987,410 52,990,188
=============== =============== ===============
4. DISPOSALS
On 6 April 2006, the Group disposed of its 100% holding of Playgolf (Heaton
Park) Limited for net cash consideration of £426,000.
Net assets disposed of: £'000
Fixed assets 342
Stocks 12
Debtors 159
Cash 14
Creditors (58)
---------------
469
Loss on disposal (43)
---------------
426
===============
Satisfied by:
Cash 426
===============
The subsidiary sold during the period contributed a £13,000 deficit to the
Group's net operating cash flows.
5. TANGIBLE FIXED ASSETS
Leasehold Other tangible
Premises Fixed assets Total
£'000 £'000 £'000
Cost or valuation
At 1 January 2006 21,719 877 22,596
Additions 363 65 428
Revaluations 381 - 381
Disposals (400) (122) (522)
--------------- ------------ ---------------
At 30 June 2006 22,063 820 22,883
--------------- ------------ ---------------
Depreciation
At 1 January 2006 463 472 935
Charge for the period 169 41 210
Elimination on disposal (60) (117) (177)
--------------- ------------ ---------------
At 30 June 2006 572 396 968
--------------- ------------ ---------------
Net Book Value
At 30 June 2006 21,491 424 21,915
=============== ============ ===============
At 31 December 2005 21,256 405 21,661
=============== ============ ===============
At 30 June 2005 12,717 223 12,940
=============== ============ ===============
6. CALLED UP SHARE CAPITAL 30 June
2006
£'000
Authorised:
500,000,000 ordinary shares of £0.002 each 1,000
===============
Allotted, called up and fully paid:
57,990,188 ordinary shares of £0.002 each 116
===============
On 22 February 2006, a further 5,000,000 new ordinary shares of £0.002 each were
placed with institutional investors at a price of £0.15 each, raising £750,000
before expenses.
7. RESERVES
Profit and
Share Merger Revaluation Other Loss
Premium Reserve Reserve Reserve account
£'000 £'000 £'000 £'000 £'000
As at 1 January 2006 2,475 467 9,753 400 (1,536)
Retained loss for period - - - (1,190)
Issue of share capital 657 - - - -
Unrealised surplus on
revaluation of leasehold
premises - - 381 - -
Realised profit on
disposal of subsidiary - - (347) - 347
Excess depreciation
on revalued properties - - (50) - 50
------------- ------------- ------------- ------------- ---------------
At 30 June 2006 3,132 467 9,737 400 (2,329)
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