365.L Regulatory News (365)

28 Sep 2007 07:01

VPhase PLC28 September 2007 VPHASE PLC Formerly Flightstore Group plc ("VPhase" or "the Company") Condensed Consolidated Interim Financial Statements for the six months ended 30 June 2007 I am pleased to issue my first statement as the new Chairman of VPhase plc, thedeveloper of voltage control products designed to reduce energy consumption. During the period under review the Company was dormant other than seeking asuitable candidate for an acquisition. I can report that, following the approvalof all resolutions by the shareholders at the extraordinary general meeting heldon 24 September 2007, the Company completed the acquisition of Energetix VoltageControl Limited ('EVC'). At the same time the change of name to VPhase plc wasapproved. On 26 September 2007 the Company's enlarged issued share capital was re-admittedto trading on AIM, a market operated by the London Stock Exchange. The acquisition of EVC also increased the Group's financial resources by£600,000, enabling it to establish the resources necessary to commercialise ournew subsidiary's energy saving device. With a new board of directors in place, comprising of myself as ExecutiveChairman, Richard Smith (Chief Financial Officer) and Nicholas Moss (NonExecutive), VPhase plc is now focused on the commercialisation, in the UK andother geographical markets, of an exciting small scale low cost energy savingdevice based on mass produced components. In addition to the newly appointed board members we are actively seeking theappointment of a Chief Executive Officer for the Group. I look forward to updating you on progress in future months. Adrian HutchingsExecutive Chairman Overview In the six months ended 30 June 2007, the Group has continued its search for asuitable business to acquire. During this period the Company was earning norevenue and only incurring limited costs. Regrettably, it was not possible toconclude a suitable transaction within the six month time frame allowed by theAIM rules since the suspension of shares on the 5 December 2006 and accordinglythe trading facility was cancelled on 6 June 2007. Revenue for the period was £Nil (2006: £Nil) and loss before income tax was£45,324 (2006: £4,972 loss). Net assets as at 30 June 2007 were £123,660 (2006:£47,635) of which cash was £160,908 (2006: £71,837). Events after the balance sheet date On 26 September the Company's name was changed from Flightstore Group plc toVPhase plc, Nicholas Nelson and John Caulcutt resigned from the board ofdirectors of the Company and Adrian Hutchings, Richard Smith and Nicholas Mossjoined the board of directors of the Company. On 26 September 2007 the Company's enlarged issued share capital was admitted totrading on AIM, a market operated by the London Stock Exchange. Upon admission we successfully completed the acquisition of Energetix VoltageControl Limited for £2.4 million satisfied by the issue of 500,105,004 newOrdinary Shares. Voltage Control product overview EVC's core product is a device that controls the incoming voltage to a propertyto a set point. Although electricity is provided by generators and distributorsat a nominal specification, for instance domestic supplies are rated at 230volts in the UK and 110 volts in North America, the actual voltage levels canvary significantly. In the UK it is legally permissible for domestic electricityto be delivered at anywhere between 216V and 253V, with resulting effects onproduct performance and reliability. When fed with a higher voltage many household devices convert the additionalenergy into wasted heat. Tests by EVC have demonstrated that the device cansave around 10 per cent. of the electricity used by domestic products such astelevisions, fridges, freezers, central heating pumps and other items. Thisshould equate to savings for the homeowner of c. £30 to £40 per annum. Inaddition, in some cases, such as light bulbs, this excess voltage can result ina shortened operational life. There is evidence that the life of electricalappliances can be extended by the use of the Voltage Control Device; lightbulbs, in particular have demonstrated at least twice as long a life when on acircuit managed by the device, as compared to those without the device. The Voltage Control Device is based on an autotransformer and is designed totypically adjust high voltage down to the set point of the transformer,currently intended to be 220V. To ensure the Voltage Control Device can bemounted inside an existing consumer unit, the Voltage Control Device is designednormally to manage voltage circuits such as lights, television, and washingmachines. The business is currently in discussions with organisations about routes tomarket and other potential wider market opportunities. Richard SmithChief Financial Officer For further information: VPhase plc Adrian Hutchings, Chairman Tel: +44 (0) 151 348 2111Richard Smith, Chief Financial Officer Tel: +44 (0) 151 348 2116 www.vphase.co.uk Zimmerman Adams 020 7060 1760 Graeme ThomCharity Walmsley www.zimmint.com BankOra Limited 020 7099 1940 Michael BrennanHenry Turcan www.bankora.com Media enquiries: Abchurch Communications 020 7398 7700 Justin HeathMonique Tsangmonique.tsang@abchurch-group.com www.abchurch-group.com Consolidated interim income statement For the six months ended 30 June 2007 Unaudited Unaudited Unaudited 6 months 6 months 12 months ended ended ended 30 June 30 June 31 December 2007 2006 2006Continuing Note £ £ £activities Revenue - - - Cost of sales - 20,000 20,000 --------------- --------------- ---------------Gross profit - 20,000 20,000 Administrativeexpenses (47,846) (25,848) (70,883) --------------- --------------- ---------------Operating loss (47,846) (5,848) (50,883) Finance income 2,522 876 1,485 --------------- --------------- ---------------Loss beforeincome tax (45,324) (4,972) (49,398) Income taxexpense 7 - - - --------------- --------------- ---------------Loss for theperiod (45,324) (4,972) (49,398) --------------- --------------- --------------- Attributable toEquity holders ofthe Company (45,324) (4,972) (49,398) --------------- --------------- ---------------Loss per shareattributable tothe equity holdersof the Companyduring the period - basic and diluted 5 (0.002)p (0.001)p (0.02)p Consolidated interim balance sheetAs at 30 June 2007 Unaudited Unaudited Unaudited At At At 30 June 30 June 31 December 2007 2006 2006 Note £ £ £ASSETSCurrent assetsTrade and otherreceivables 5,774 3,351 2,470Cash and cashequivalents 160,908 71,837 201,606 -------- -------- -------- 166,682 75,188 204,076 -------- -------- --------Total assets 166,682 75,188 204,076 -------- -------- --------LIABILITIESCurrent liabilitiesTrade and otherpayables 43,022 27,553 35,092 -------- -------- -------- 43,022 27,553 35,092 -------- -------- --------Total liabilities 43,022 27,553 35,092 -------- -------- -------- EQUITYCapital andreservesattributable toequity holders ofthe CompanyShare capital 1,203,764 1,003,764 1,203,764Share premium 1,400,992 1,435,717 1,400,992Other reserve 2,272,123 2,272,123 2,272,123Investment in ownshares (47,278) (100,000) (47,278)Retained losses (4,705,941) (4,563,969) (4,660,617) -------- -------- --------Totalshareholders'equity 123,660 47,635 168,984 -------- -------- --------Total equity andliabilities 166,682 75,188 204,076 -------- -------- -------- Consolidated interim cash flow statementFor the six months ended 30 June 2007 Unaudited Unaudited Unaudited 6 months 6 months 12 months ended ended ended 30 June 30 June 31 December 2007 2006 2006 Note £ £ £ Cash flows fromoperatingactivitiesCash consumed byoperations 8 (43,220) (23,821) (59,936) -------- -------- -------- Cash flows frominvestingactivitiesInterest received 2,522 876 1,485 -------- -------- -------- 2,522 876 1,485 -------- -------- -------- Cash flows fromfinancingactivitiesNet proceeds fromthe issue ofordinary shares - - 165,275 -------- -------- -------- - - 165,275 -------- -------- -------- Net (decrease)/increase in cash andcash equivalents (40,698) (22,945) 106,824 Cash and cashequivalents atthe beginning ofthe period 201,606 94,782 94,782 -------- -------- --------Cash and cashequivalents atthe end of theperiod 160,908 71,837 201,606 -------- -------- -------- Consolidated interim statement of changes in equityFor the six months ended 30 June 2007 Attributable to equity holders of the Company Share Share Retained Other Investment in Total Capital Premium Losses Reserve Own shares Equity £ £ £ £ £ £ Balance at 31 December 2005 1,003,764 1,435,717 (4,558,997) 2,272,123 (100,000) 52,607 Total recognised income/(loss)- Loss for the period - - (4,972) - - (4,972) Balance at 30 June 2006 1,003,764 1,435,717 (4,563,969) 2,272,123 (100,000) 47,635 Shares issued 1 December 2006 200,000 - - - - 200,000Movement in share premium account- Issue costs on subscription in year - (34,725) - - - (34,725) Sale of own shares - - - - 52,722 52,722Loss on sale of own shares - - (52,222) - - (52,222)Total recognised income/(loss)- Loss for the period - - (44,426) - - (44,426) Balance at 31 December 2006 1,203,764 1,400,992 (4,660,617) 2,272,123 (47,278) 168,984 Total recognised income/(loss)- Loss for the period - - (45,324) - - (45,324) Balance at 30 June 2007 1,203,764 1,400,992 (4,705,941) 2,272,123 (47,278) 123,660 Selected explanatory notes 1. Nature of operations and general information VPhase plc did not trade in the first 6 months of 2007 although the Boardcontinued to search for a suitable company to acquire. The Company completed an acquisition on 26 September 2007 and the admission ofits shares to the AIM Market of the London Stock Exchange on the same day. VPhase plc is the Group's holding company and is incorporated in England andWales. The address of the registered office is Steam Packet House, 76 CrossStreet, Manchester, M2 4JU. VPhase plc's shares are listed on the AIM market ofthe London Stock Exchange. The Group's ultimate parent company is Energetix Group plc, a companyincorporated in England and Wales, whose registered office is Steam PacketHouse, 76 Cross Street, Manchester, M2 4JU. Energetix Group plc's shares arelisted on the AIM Market of the London Stock Exchange. The condensed consolidated interim financial statements (the interim financialstatements) are presented in pounds sterling (£), which is also the functionalcurrency of the parent. These interim financial statements have been approved for issue by the Board ofDirectors on 27 September 2007. The financial information set out in the interim report does not constitutestatutory accounts as defined in Section 240 of the Companies Act 1985. TheGroup's statutory financial statements for the year ended 31 December 2006,prepared under UK GAAP, have been filed with the Registrar of Companies. Theauditor's report on those financial statements was unqualified and did notcontain a statement under Section 237(2) of the Companies Act 1985. 2. Basis of preparation These interim financial statements are for the six months ended 30 June 2007.They have been prepared in accordance with the requirements of IFRS 1"First-time Adoption of International Financial Reporting Standards" relevant tointerim reports, because they are part of the period covered by the Group'sfirst IFRS financial statements for the year ended 31 December 2007. They donot include all of the information required for full annual financialstatements, and should be read in conjunction with the consolidated financialstatements of the Group for the year ended 31 December 2006. These interim financial statements have been prepared under the historical costconvention. These interim financial statements have been prepared in accordance with theaccounting policies set out in the most recently available public information(see note 3), which are based on the recognition and measurement principles ofIFRS in issue as adopted by the European Union (EU) and are effective at 31December 2007 or are expected to be adopted and effective at 31 December 2007,our first annual reporting date at which we are required to use IFRS accountingstandards adopted by the EU. VPhase plc's consolidated financial statements were prepared in accordance withUnited Kingdom Accounting Standards (United Kingdom Generally AcceptedAccounting Practice) until 31 December 2006. The date of transition to IFRS was1 January 2006. The comparative figures in respect of 2006 have been restatedto reflect changes in accounting policies as a result of adoption of IFRS. Thedisclosures required by IFRS 1 concerning the transition from UK GAAP to IFRSare explained in note 10. The Group has taken advantage of exemptions under IFRS and no restatement hasbeen made to the accounting treatment of previous business combinations,including the acquisition of Flightstore Inflight Retailing Ltd by the Group on8 December 2003. The accounting policies have been applied consistently throughout the Group forthe purposes of preparation of these interim financial statements. The directors have adopted the going concern basis in preparing the interimcondensed consolidated financial statements. This is considered appropriate, asthe shareholders will continue to provide financial support to the Group for theforeseeable future. The directors have continued to search for acquisitionopportunities and consider that there are sufficient funds to run the Groupuntil such time as the Group can attract additional inward investment to takethe group forward. 3. Summary of significant accounting policies The Group accounting policies used in the interim financial statements areconsistent with those applied in its most recent publicly available information.For further information, please refer to VPhase plc's (formerly FlightstoreGroup plc) Admission to AIM document issued 26 September 2007. 4. Segmental information The group has not traded during the periods ending 31 June 2007, 30 June 2006and 31 December 2006 due to the group searching for a suitable company toacquire. Accordingly, no segmental information is provided. 5. Loss per share The loss per share is calculated by reference to the loss attributable toordinary shareholders divided by the weighted average number of ordinary sharesin issue during the period as follows: Unaudited Unaudited Unaudited 6 months 6 months 12 months ended ended ended 30 June 30 June 31 December 2007 2006 2006 Loss attributable to equity holders of the Group (45,324) (4,972) (49,398) Weighted average number ofordinary shares in issue 2,095,885,116 90,876,460 257,125,739 Basic and diluted loss per share (pence) (0.002)p (0.001)p (0.02)p The share options and warrants in issue are anti-dilutive in respect of thebasic loss per share calculation and have therefore not been included in theabove calculations. In addition, deferred ordinary shares have been excludedfrom the calculations. In accordance with IAS 33, Earnings per share, theweighted average number of ordinary shares in issue excludes the number of ownshares held within the Group by FG Employee Trustee Company Limited. 6. Warrants On 8 November 2006, the Company, as part of its fundraising activities, enteredinto an instrument constituting the Warrants, pursuant to which the Warrantholders are entitled to subscribe for in aggregate 1,025,000,000 Ordinary Sharesin the Company subject to the terms of the Warrant Instrument. The Warrants are exercisable at a price of 0.01p per Ordinary Share at any timeuntil 31 December 2012 and may be exercised in full or in more than one tranche. The Warrant Instrument contains anti-dilution provisions such that in the eventof any consolidation of Ordinary Shares the number and nominal value of theshares the subject of the Warrants will be adjusted in such manner as theCompany's auditors shall certify to be necessary in order that, after suchadjustment, the total number of Ordinary Shares which may be subscribed pursuantunder the Warrant Instrument will (inter alia) carry (as nearly as possible) thesame proportion of votes as those shares carried prior to such adjustment andwill have the same economic value. On 24 September 2007 a meeting of warrant holders was held at the offices ofFasken Matineau Stringer Saul of 17 Hanover Square, London W1S 1HU. At thismeeting extraordinary resolutions to remove certain protections currentlyattaching to the Warrants under the terms of the Warrant Instrument were agreed. On 24 September 2007, conditional on admission, 1,000,000,000 of the Warrantswere exercised at a premium of £57,000 to their aggregate subscription price. 7. Taxation As at 30 June 2007, the group had tax losses of approximately £2.4 million thatare available for offset against future profits arising from the same trade. Noprovision has been made for deferred tax on losses carried forward in the Group. These losses will only be available for offset when the Group makes taxableprofits arising from the same trade. As the timing of these profits is notcertain it has been assumed the losses will not be recoverable in theforeseeable future. 8. Cash consumed by operations Restated Restated Unaudited Unaudited Unaudited 6 months 6 months 12 months ended ended ended 30 June 30 June 31 December 2007 2006 2006 £ £ £ Loss before income tax (45,324) (4,972) (49,398)Adjustments for:-Finance income (2,522) (876) (1,485) Changes in working capital -Trade and other receivables (3,303) 1,643 3,024 -Trade and other payables 7,929 (19,616) (12,077) -------- -------- -------- (43,220) (23,821) (59,936) -------- -------- -------- 9. Events after the balance sheet date On 26 September 2007, the group acquired the whole of the issued share capitalof Energetix Voltage Control Limited. The consideration for the acquisition was£2.4 million and was satisfied by the issue to the shareholders of EnergetixVoltage Control Limited of 500,105,004 new Ordinary Shares. Further details of the acquisition are contained within the admission to AIMdocument of Vphase plc (formerly Flightstore Group plc). 10. Explanation of transition to IFRS As stated in the Basis of Preparation, these are the Group's first condensedconsolidated interim financial statements for part of the period covered by thefirst IFRS annual consolidated financial statements prepared in accordance withIFRS. An explanation of how the transition from UK GAAP to IFRS has affected theGroup's financial position, financial performance and cash flows is set outbelow. IFRS 1 permits companies adopting IFRS for the first time to take certainexemptions from the full requirements of IFRS in the transition period. Theseinterim financial statements have been prepared on the basis of taking thefollowing exemptions: • Business combinations prior to 1 January 2006, the Group's date of transition to IFRS, have not been restated to comply with IFRS 3 "Business Combinations". Accordingly, there has been no adjustment to the accounting treatment adopted by the Group on the acquisition of Flightstore Inflight Retailing Ltd by the Group on 8 December 2003 which was accounted for at that date as a merger under UK GAAP. The merger reserve has been redefined as an other reserve under IFRS; • Only share based payment arrangements granted after 7 November 2002 that had not vested prior to 1 January 2006 are recognised in the condensed consolidated interim financial statements. Accordingly, the directors have reviewed the options granted to directors and employees on 7 September 2004, 31 December 2004 and 23 May 2005 deeming them immaterial to the condensed consolidated interim financial statements. In addition, during the year ended 31 December 2006, the options issued to directors were cancelled by the Group, with no further share options being granted. Explanation of material adjustments to the cash flow statement : There are no material differences between the cash flow statement presentedunder IFRS and the cash flow statement presented under UK GAAP. Explanation of reconciliation from UK GAAP to IFRS for the balance sheet andincome statement: The adoption of IFRS by the Group has resulted in some reordering of thepresentation of certain balances within both the income statement and balancesheet. However, there has been no impact on previously reported equity,liabilities or assets at 31 December 2006 or 30 June 2006, or comparativeamounts disclosed in the income statement for the year ended 31 December 2006 orthe six months ended 30 June 2006. This information is provided by RNS The company news service from the London Stock Exchange