RNS Number:3178K
Aquabella Group PLC
20 December 2007
Aquabella Group PLC
Interim results for the six months ended 30 September 2007
(Unaudited)
AQUABELLA GROUP PLC
CHAIRMAN'S STATEMENT FOR THE 6 MONTH PERIOD ENDED 30 SEPTEMBER 2007
I am pleased to report the Company's Interim results for the six months to 30
September 2007.
The period under review is the first published results of the Group prepared
under International Financial Reporting Standards (IFRS). Reconciliations from
UK GAAP to IFRS are included as an appendix to the interim report.
Financial Highlights
30 September 30 September
2007 2006
� �
(As re-stated)
Turnover 487,713 188,195
Gross (loss)/profit (319,954) 131,713
Loss before and after tax (1,422,340) (705,218)
The turnover of the Group for the first six months showed a 159% increase over
the same period last year and an 82% increase over the previous six months.
During the period 83 tonnes of fish were sold (2006: 25 tonnes, 2006 full year:
61 tonnes) with retail sales making up 63% of the total and wholesale 33%. All
tonnages are quoted as whole fish equivalent weights (WFE).
The principal effect on the financial statements of the Group on the adoption of
IFRS is to value biological stock at fair value rather than at cost which
results in an increase in the value of the biological stock shown on the balance
sheet. The effect on the results in the period of transition is shown in the
appendix to this interim report. There is no cash impact on the Group on the
adoption of IFRS.
Events since the period end
Key events since the half year end have been:
* Successful equity fundraising of �785k and issue of Convertible Loan Notes
of �900k in October 2007.
* Appointment of Robert Smith as Managing Director on 30 November 2007.
* Commissioning of filleting machine in early November 2007.
* Launch of fillets into a second major retail chain.
Exceptional item
In early 2007 the Board identified a vertical acquisition opportunity which
progressed to a very advanced stage but did not complete. As a result the
Company incurred advisor/professional abort fees of �206k, which appear as an
exceptional item.
Current Trading
Average weekly sales in October reached 3.9 tonnes including one week in excess
of 4.3 tonnes. The commissioning of a filleting machine and the launch of
fillets, originally planned for June within the context of the proposed vertical
acquisition, was successfully achieved in November with a second major retailer
taking fillets at the same time. This is a positive step for both retailers and
consumers as it enables penetration of the convenience market, both on the wet
fish counter and through pre-pack. We have ordered a de-scaling machine, which
is expected to be operational in January, which will enable us to further
increase our filleting production as well as offer de-scaled whole fish, which
will greatly enhance the appeal of the New Forest Barramundi product.
Sales of white fish in the run up to and during the Festive Season are generally
slow and as Christmas de-listings kick in we have seen sales of whole fish slow
in recent weeks. It is pleasing, however, to report that one major retailer has
agreed to stock fillets throughout the Christmas period. We anticipate that the
first quarter of 2008 will see other retailers and wholesalers following the
trend towards fillets.
It is encouraging that having launched fillets in two of the major retailers, we
have indeed seen the uplift in fillet sales of 3 to 5 times the sales of whole
fish which the retailers said we should expect. We anticipate the trend
towards fillets to continue so that in the future as much as 80% of sales will
be in fillets.
Whilst fillets are initially being sold on the wet fish counters the retailers
are also showing interest in taking pre-packed fillets for their chilled
shelves. This will allow us to target retailers who do not have wet fish
counters and does open up additional opportunities in the pre-packed convenience
market and other added value products such as smoked fillets.
We will be rolling fillets out to all our wholesalers in the New Year.
Sales prices have been lower than normal since the summer as a result of
promotions and the introductory pricing of fillets. We expect pricing to
improve as fillets become established in the market during 2008.
Working Capital
The Board continues to review working capital forecasts (and strategic options)
carefully. The first quarter of 2008 is important to the financial wellbeing of
the group, and whilst indications are indeed positive for the re-listing of
whole fish post Christmas and take up of fillets early in the New Year, the
board will be monitoring sales volumes and prices closely going forward.
The Future
Having successfully launched fillets, and having seen steady progress in whole
fish sales before the onset of the Festive Season we remain confident that the
first half of 2008 will be positive for the group. Expansion of fillet sales
into other major retailers, greater penetration of the retailers' estates, an
ever improving product, particularly through filleting and de-scaling, and a
wider product offering to the convenience market are all encouraging steps in
the progress of Aquabella. Underpinning all this is an excellent tasting,
healthy, sustainable fish available fresh every day to our customers.
We remain grateful for the continuing support of our shareholders in particular
in the recent fundraisings.
On behalf of the Board
Pieter W Totte
Chairman
20 December 2007
Enquiries
Aquabella
Pieter Totte
020 7234 0570
Shore Capital
Guy Peters
020 7408 4090
AQUABELLA GROUP PLC
CONSOLIDATED INCOME STATEMENT
FOR THE SIX MONTHS ENDING 30 SEPTEMBER 2007
(UNAUDITED)
Note Period ended Period ended
30 September 2007 30 September 2006
(As re-stated)
� �
REVENUE 487,713 188,195
Cost of sales (807,667) (56,482)
GROSS (LOSS)/PROFIT (319,954) 131,713
Distribution costs (70,633) (75,915)
Administration expenses (797,938) (742,679)
Abortive acquisition costs (206,136) -
Finance costs 3 (27,679) (18,337)
LOSS BEFORE INCOME TAX (1,422,340) (705,218)
Income tax expense - -
LOSS FOR THE PERIOD ATTRIBUTABLE TO EQUITY
SHAREHOLDERS
(1,422,340) (705,218)
ALL AMOUNTS RELATE TO CONTINUING OPERATIONS
AQUABELLA GROUP PLC
CONSOLIDATED BALANCE SHEET 30 SEPTEMBER 2007
(UNAUDITED)
Note 30 September 2007 30 September 2006 31 March
2007
(As re-stated) (As re-stated)
� � �
ASSETS
Non-current assets
Goodwill 44,905 44,905 44,905
Property, plant and equipment 4,311,038 4,753,802 4,454,439
Rent bond 153,000 153,000 153,000
4,508,943 4,951,707 4,652,344
Current Assets
Biological assets 4 325,882 533,140 296,365
Inventories 18,445 18,319 19,494
Trade and other receivables 240,046 199,360 176,459
Cash and cash equivalents 5 130,640 484,826 11,957
715,013 1,235,645 504,275
Total Assets 5,223,956 6,187,352 5,156,619
LIABILITIES
Current Liabilities
Short-term borrowings (117,647) (117,647) (620,654)
Trade and other payables (1,092,644) (554,358) (792,268)
(1,210,291) (672,005) (1,412,922)
Non-current Liabilities
Long-term borrowings (245,098) (362,746) (303,922)
Provisions (16,992) - (24,425)
(262,090) (362,746) (328,347)
3,751,575 5,152,601 3,415,350
TOTAL ASSETS LESS LIABILITIES
SHAREHOLDERS' EQUITY
Called up share capital 940,943 730,393 732,993
Share premium 7,787,760 6,092,086 6,223,876
Other reserves 221,216 245,625 234,487
Retained earnings (5,198,344) (1,915,503) (3,776,006)
EQUITY SHAREHOLDERS' FUNDS 3,751,575 5,152,601 3,415,350
AQUABELLA GROUP PLC
STATEMENT OF CHANGES IN EQUITY for the six months ended 30 September 2007
(UNAUDITED)
Issued Share Share
premium option
share account reserve Retained
earnings
capital Total
� � � � �
Balance at 31 March 2006 638,279 4,562,329 100,603 (1,210,285) 4,090,926
Shares issued 92,114 1,529,757 - - 1,621,871
Shares to be issued - options - - 145,022 - 145,022
Loss for the period - - - (705,218) (705,218)
Balance as at 30 September 2006 730,393 6,092,086 245,625 (1,915,503) 5,152,601
Balance at 31 March 2007 732,993 6,223,876 234,487 (3,776,004) 3,415,352
Shares issued 207,950 1,563,884 - - 1,771,834
Shares to be issued - options - - (13,271) - (13,271)
Loss for the period - - - (1,422,340) (1,422,340)
Balance as at 30 September 2007 940,943 7,787,760 221,216 (5,198,344) 3,751,575
AQUABELLA GROUP PLC
CASH FLOW STATEMENT
for the six months ended 30 September 2007
(UNAUDITIED)
6 months to 6 months to
30 September 2007 30 September 2006
(As re-stated)
� �
Cash flows from operating activities
Loss before income tax expense (1,422,340) (705,218)
Adjustments for:
Share based payments (13,271) 145,022
Depreciation 213,301 239,401
Finance costs 27,679 18,337
Abortive acquisition costs 206,136 -
Changes in working capital:
Biological assets (29,518) (533,140)
Inventories 1,050 58,738
Receivables (63,587) 38,031
Payables 292,945 (162,791)
Cash generated from operating activities (787,605) (901,620)
Interest paid (34,348) (25,220)
Abortive acquisition costs (206,136) -
Net cash from operating activities (1,028,089) (926,840)
Cash flows from investing activities
Purchase of property, plant and equipment (69,900) (384,138)
Interest received 6,669 6,883
Net cash used in investing activities (63,231) (377,255)
Outflow before financing activities (1,091,320) (1,304,095)
Cash flows from financing activities
Proceeds from issue of share capital 1,771,834 1,621,871
Borrowing repayments (58,824) (19,608)
Net cash generated from financing activities 1,713,010 1,602,263
Net increase in cash and cash equivalents 621,690 298,168
Opening cash and cash equivalents (491,050) 186,658
Cash and cash equivalents at end of period 130,640 484,826
AQUABELLA GROUP PLC
NOTES TO THE INTERIM RESULTS
(UNAUDITIED)
1. GENERAL INFORMATION
Aquabella Group PLC is a public limited company ("Company") incorporated in the
United Kingdom under the Companies Act 1985 (registration number 5132573). The
Company is domiciled in the United Kingdom and it's registered address is 53
Lafone Street, Shad Thames, London, SE1 2LX. The Company's shares are traded on
the Alternative Investment Market ("AIM").
The Company's principal activity is that of a holding company for International
Aqua Farms Limited, a barramundi farm.
Copies of the interim report are being sent to shareholders. Further copies of
the Interim Report and Annual Report and Financial Statements may be obtained
from the address above.
2. BASIS OF PREPARATION
Aquabella Group PLC has adopted International Financial Reporting Standards
(IFRS) with effect from 1 April 2006. The Group will apply IFRS in its
consolidated financial statements for the year ending 31 March 2008. Therefore
these interim statements are the Group's first financial statements prepared in
accordance with IFRS.
The financial information set out in this document does not comprise of the
statutory accounts of the Company within the meaning of section 240(5) of the
Companies Act 1985.
A reconciliation showing the impact of the transition from UK GAAP to IFRS is
contained in the appendix to this interim report.
3. FINANCE COSTS
Period ended
Period ended 30 September 2006
30 September 2007 �
�
Interest expense (34,348) (25,220)
Interest income 6,669 6,883
(27,679) (18,337)
4. BIOLOGICAL ASSETS
The accounting treatment for the biological stock of live fish under IFRS is
governed by IAS 41 "Agriculture". IAS 41 requires that biological assets are
valued at their fair value at the balance sheet date. Fair value is determined
from the average selling price achieved in the month of valuation less
distribution costs. The Directors consider that fair value can be estimated in
accordance with IAS 41 for fish that are harvestable (over 300g). For non
harvestable fish (under 300g) it is the opinion of the Directors that it is not
possible to make a reliable estimate of the fair value due to biological
uncertainties, price fluctuations and non-saleability of smaller fish. The
Directors have therefore decided to use the exemption in IAS 41 paragraph 30 and
value these fish at cost. This policy is consistent with the industry's
interpretation of IAS 41 and has been used by similar companies which have
adopted IFRS.
AQUABELLA GROUP PLC
NOTES TO THE INTERIM RESULTS
(UNAUDITIED)
5. CASH AND CASH EQUIVALENTS
Cash and cash equivalents, for the purposes of the cash flow statement,
comprises cash in hand and at the bank, any deposits repayable on demand, less
any bank overdrafts.
An analysis of cash and cash equivalents is as follows:
30 September 2007 30 September 2006
� �
Cash in hand and at bank 130,640 484,826
Bank overdrafts - -
Net cash and cash equivalents 130,640 484,826
6. LOSS PER ORDINARY SHARE
Loss per share is calculated on the basis of loss for the year after tax,
divided by the weighted average number of shares in issue for the period to 30
September 2007 of 20,455,471 (2006: 16,355,844).
The calculation of diluted loss per share, which shows the dilutive effect of
share options and warrants, has not been reflected in this report as the effect
would be anti-dilutive, as defined by IAS 33 "Earnings per share".
2007 2006
Earnings Weighted Per share Earnings Weighted Per share amount
Average No. amount � Average No. of pence
� pence shares
of shares
Earnings attributable (1,422,340) 20,455,471 (6.95) (705,218) 16,355,844 (4.31)
to ordinary
shareholders
AQUABELLA GROUP PLC
NOTES TO THE INTERIM RESULTS
(UNAUDITIED)
7. DIVIDENDS
No dividend is proposed for the six months ended 30 September 2007.
8. DEFERRED INCOME TAX
The charge for taxation is based on the results for the period and takes into
account taxation deferred because of timing differences between the treatment of
certain items for taxation and accounting purposes.
Provision is made in full for taxation deferred in respect of timing differences
that have originated but not reversed by the balance sheet date, except for
gains on disposal of fixed assets which will be rolled over into replacement
assets. No provision is made for taxation on permanent differences. Deferred
tax is not discounted.
Deferred tax assets are recognised to the extent that it is more likely than not
that they will be recovered.
9. ENQUIRIES
Pieter Totte
Aquabella Group Plc
53 Lafone Street
Shad Thames
London
SE1 2LX
020 7234 0570
AQUABELLA GROUP PLC
APPENDIX TO THE INTERIM RESULTS
(UNAUDITIED)
Reporting Under International Financing Reporting Standards
This interim report is the first report to be prepared under IFRS. The Group's
date of transition is 1 April 2006, therefore the opening balance sheet for IFRS
purposes is that reported at 31 March 2006 as amended for changes due to IFRS.
The comparative figures have been prepared on the same basis and have therefore
been restated from those previously prepared under UK GAAP. Notes below explain
the effect of converting from UK GAAP to IFRS in these accounts.
To show the impact of adopting IFRS, reconciliation schedules have been included
in this appendix as follows:
1. Reconciliation of Group Balance Sheet as at 30 September 2006 UK GAAP
to IFRS
2. Reconciliation of Group Balance Sheet as at 31 March 2007 UK GAAP to IFRS
3. Reconciliation of Group Income Statement for six months ending
30 September 2006
The transition of UK GAAP to IFRS does not affect the cash flows generated by
the Group. There is therefore no reconciliation statement required for its
impact on cash flows.
Goodwill and Business Combinations
The Group has taken advantage of the exemption not to apply IFRS 3
retrospectively to business combinations occurring prior to the date of
transition to IFRS. Goodwill arising on acquisitions has been retained at its
carrying value as at 1 April 2006. Goodwill amortisation is no longer allowed
under IAS 36, which has resulted in this charge being reversed in these
accounts.
Biological Assets
The accounting treatment for the biological stock of live fish under IFRS is
governed by IAS 41 "Agriculture". IAS 41 requires that biological assets are
valued at their fair value at the balance sheet date. Fair value is determined
from the average selling price achieved in the month of valuation less
distribution costs. The Directors consider that fair value can be estimated in
accordance with IAS 41 for fish that are harvestable (over 300g). For non
harvestable fish (under 300g) it is the opinion of the Directors that it is not
possible to make a reliable estimate of the fair value due to biological
uncertainties, price fluctuations and non-saleability of smaller fish. The
Directors have therefore decided to use the exemption in IAS 41 paragraph 30 and
value these fish at cost. This policy is consistent with the industry's
interpretation of IAS 41 and has been used by similar companies which have
adopted IFRS.
Reconciliation of Group Balance Sheet at 31 March 2006 from UKGAAP to IFRS
At 31 March 2006 the Group did not hold any biological assets and no
amortisation charge of goodwill had been made in the period then ended. There
were no other IFRS adjustments and so a reconciliation from UKGAAP to IFRS has
not been presented.
AQUABELLA GROUP PLC
APPENDIX TO THE INTERIM RESULTS
(Unaudited)
Reconciliation of Group Balance Sheet at 30 September 2006
from UK GAAP to IFRS
ASSETS UK GAAP IAS 41 Biological IAS 36 Goodwill IFRS as at
Assets 30 September 2006
Non-Current Assets � � � �
Goodwill 42,993 - 1,912 44,905
Property, plant and equipment 4,753,802 - - 4,753,802
Rent bond 153,000 - - 153,000
4,949,795 - 1,912 4,951,707
Current Assets
Biological assets - 533,140 - 533,140
Inventories 302,897 (284,578) - 18,319
Trade and other receivables 199,360 - - 199,360
Cash and cash equivalents 484,826 - - 484,826
987,083 248,562 - 1,235,645
Total Assets 5,936,878 248,562 1,912 6,187,352
LIABILITIES
Current Liabilities
Short-term borrowings (117,647) - - (117,647)
Trade and other payables (554,358) - - (554,358)
(672,005) - - (672,005)
Non-Current Liabilities
Long-term borrowings (362,746) - - (362,746)
(362,746) - - (362,746)
TOTAL ASSETS LESS LIABILITIES 4,902,127 248,562 1,912 5,152,601
SHAREHOLDERS' EQUITY
Called up share capital 730,393 - - 730,393
Share premium 6,092,086 - - 6,092,086
Other reserves 245,625 - - 245,625
Retained earnings (2,165,977) 248,562 1,912 (1,915,503)
EQUITY SHAREHOLDERS' FUNDS 4,902,127 248,562 1,912 5,152,601
AQUABELLA GROUP PLC
APPENDIX TO THE INTERIM RESULTS
(Unaudited)
Reconciliation of Group Balance Sheet at 31 March 2007
from UK GAAP to IFRS
UK GAAP IAS 41 Biological IAS 36 Goodwill IFRS as at 31 March
2007
ASSETS Assets
Non-current Assets � � � �
Goodwill 39,292 - 5,613 44,905
Property, plant and equipment 4,454,439 - - 4,454,439
Rent bond 153,000 - - 153,000
4,646,731 - 5,613 4,652,344
Current Assets
Biological assets - 296,365 - 296,365
Inventories 243,803 (224,309) - 19,494
Trade and other receivables 176,459 - - 176,459
Cash and cash equivalents 11,957 - - 11,957
432,219 72,056 - 504,275
Total Assets 5,078,950 72,056 5,613 5,156,619
LIABILITIES
Current Liabilities
Short-term borrowings (620,654) - - (620,654)
Trade and other payables (792,268) - - (792,268)
(1,412,922) - - (1,412,922)
Non-Current Liabilities
Long-term borrowings (303,922) - - (303,922)
Provisions (24,425) - - (24,425)
(328,347) - - (328,347)
TOTAL ASSETS LESS LIABILITIES 3,337,681 72,056 5,613 3,415,350
SHAREHOLDERS' EQUITY
Called up share capital 732,993 - - 732,993
Share premium 6,223,876 - - 6,223,876
Other reserves 234,487 - - 234,487
Retained earnings (3,853,675) 72,056 5,613 (3,776,006)
EQUITY SHAREHOLDERS' FUNDS 3,337,681 72,056 5,613 3,415,350
AQUABELLA GROUP PLC
APPENDIX TO THE INTERIM RESULTS
(Unaudited)
Reconciliation of Group Income Statement for the six months ended 30 September
2006
from UK GAAP to IFRS
UK GAAP IAS 41 IAS 36 Goodwill IFRS
Biological
Assets
CONTINUING OPERATIONS � � � �
REVENUE 188,195 - - 188,195
Cost of sales (305,044) 248,562 - (56,482)
(116,849) 248,562 - 131,713
Distribution expenses (75,915) - - (75,915)
Administration expenses (744,591) - 1,912 (742,679)
Finance costs (18,337) - - (18,337)
Loss before income tax (955,692) 248,562 1,912 (705,218)
Income tax expense - - - -
Loss after income tax (955,692) 248,562 1,912 (705,218)
This information is provided by RNS
The company news service from the London Stock Exchange
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