RNS N umber:3779R
Clipper Ventures PLC
30 October 2003
Clipper Ventures plc
Financial Statements
For
30 April 2003
Company Registration Number 03087938
The Board of Directors Mr W Ward Chief Executive Officer
Sir R Knox-Johnston Chairman
Mr R Cooper Managing Director
Mr J Knight Finance Director
Mr R Dench Non-Executive Director
Company Secretary Mr J Knight
Registered Office Shamrock Quay
William Street
Northam
Southampton
SO14 5QL
Auditors MacIntyre Hudson
Chartered Accountants
& Registered Auditors
Peterbridge House
The Lakes
Northampton
NN4 7HB
Bankers LloydsTSB Plc
Secklow Gate
Lloyds Court Central
Milton Keynes
MK9 3EH
Solicitors Memery Crystal
31 Southampton Row
London
WC1B 5HT
Nominated Advisors ARM Corporate Finance
12 Pepper Street
London
E14 9RP
(Appointed 1 September 2003)
Corporate Synergy Plc
12 Nicholas Lane
London
EC4N 7BM
(Resigned 31 August 2003)
Nominated Broker Hoodless Brennan & Partners Plc
40 Marsh Wall
Docklands
London
E14 9TP
Registrar Northern Registrars Limited
Northern House
Woodsome Park
Fenay Bridge
Huddersfield
HD8 OLA
Introduction
Whilst the shocks of the stock market decline and subsequent crash have
continued reverberate throughout the sponsorship market, Clipper has in part
been protected by its less than complete reliance on corporate sponsorships.
Its "City Partnerships" model continues to generate healthy levels of interest,
as demonstrated by recently announced, high value sponsorships in Liverpool and
Perth, Western Australia. As well as reinforcing the continuing "
internationalisation" of the Clipper Race, the 4-year, #1.8 mill, Liverpool City
sponsorship arrangement in particular presents Clipper with a tremendous growth
platform. The successful completion of the Around Alone Race in 2002 was
another major achievement for Clipper. As with the Clipper Race, huge media
coverage and popular support were attracted.
Operations
Clipper Race
The Clipper 2002 race was completed in Liverpool in September in front of many
thousands of spectators. This has been a highly successful event, which has
increased the profile of the race yet further.
Our strategic alliance with Fast Track, part of the Sports Resource Group Plc,
is now starting to bear fruit. It was vital that this alliance drastically
improved the quality of our sponsorship revenue. We have already announced a $1
million sponsorship deal with Shanghai Double Happiness - the largest
sponsorship deal completed by Clipper Ventures to date. Liverpool hosted the
start and finish of the 2002 race with great success and so we were pleased to
recently announce that we had reached agreement with Liverpool to host the 2005
and 2007 starts and finishes. We are also undertaking final negotiations with a
number of other sponsor cities for the Clipper 2005 race, at a significantly
higher level of sponsorship income than in previous races. We anticipate further
announcements regarding these negotiations in the coming weeks.
Dubois 68'
The Clipper 2005 race is being run on a fleet of 68' yachts designed by the
world-renowned naval architect Ed Dubois. The yachts are being built in
Shanghai, and currently the project is on target to deliver the first of the
yachts to the UK on time and on budget, in 2004. With 18 berths per yacht, we
will be able to generate a more than 50% increase in crew sales in future races.
Around Alone
This event finished in May 2003. The event was purchased with less than 2 years
until its start, and this short time to plan and organise the event naturally
limited the level of sponsorship that could be achieved. It was the Board's
intention that the event should be run as near as possible to break-even, and
this has been achieved.
Soon after the conclusion of the event, the re-branding of the race to "5-oceans
" was announced. At the same time an Advisory Board was established, consisting
of some of the top names in the sport, to assist in the organisation of the next
event. Also a new sponsorship package has been developed. These three
developments have been very well received and we are looking forward to 5 Oceans
taking its place as the pinnacle of the sport's events.
Corporate Sailing
We reported earlier in the year that we were discontinuing our corporate sailing
activities on our fleet of 38' yachts and would be divesting of the fleet. This
exit has now been successfully completed, and all of the yachts have been sold.
In order to show the company's financial performance more clearly,
the profit and loss of the company has been analysed in this report between this
discontinued business and our on-going round the world racing operations.
Outlook
The difficult economic environment has undoubtedly had an impact on the
business, yet our continuing operations have managed to achieve an operating
profit. We are now seeing evidence that the excellence of the Clipper and 5
Oceans events, the strategic alliance with Fast Track and our focus on our core
business is delivering improvements in the profitability of the company.
Sir Robin Knox-Johnston
Chairman
Dated 29th October 2003
The directors present their report and the financial statements of the company
for the year ended 30 April 2003.
Principal activities and business review
The company organises and manages two round the world races; 'The Clipper Round
the World Race' and the 'Around Alone Race', recently renamed '5 Oceans Race'.
In the opinion of the directors the state of the company's affairs and its
future prospects are satisfactory.
The Directors' Report should be read in conjunction with the Chairman's
Statement which includes information about the company's business performance
during the period and indication of future prospects.
Results and dividends
The trading results for the year and the company's financial position at the end
of the year are shown in the attached financial statements.
The directors have not recommended a dividend.
The directors and their interests in shares of the company
The directors who served the company during the year together with their
beneficial interests in the shares of the company were as follows:
Class of share At At
30 April 2003 1 May 2002
or later date
of appointment
Mr W Ward Ordinary 1p shares 5,014,881 4,822,573
Mr W Ward Deferred 1p Ordinary shares 19,526,627 19,526,627
Sir R Knox-Johnston Ordinary 1p shares 1,876,608 1,684,300
Mr R Cooper Ordinary 1p shares 320,000 320,000
Mr J Knight - -
Mr R Dench - -
Mr T Cowper - -
==================== ==================
==================== ==================
Mr R Dench was appointed as a director on 10 April 2003.
Mr T Cowper retired as a director on 10 April 2003.
Directors' options and warrants
Details of directors' share warrants and options are as follows:
Share warrants
No. Price Exercisable
Mr W Ward 600,000 40p 31.3.03 - 31.3.08
Sir R Knox-Johnston 150,000 40p 31.3.03 - 31.3.08
Mr R Cooper Nil
Mr J Knight Nil
Share options
No. Price Exercisable
Mr W Ward Nil
Sir R Knox-Johnston Nil
Mr R Cooper 80,000 32.5p 30.9.04 - 30.9.11 +
Mr R Cooper 320,000 32.5p 30.9.04 - 30.9.08 +
Mr J Knight 80,000 32.5p 30.9.04 - 30.9.11 +
Mr J Knight 70,000 32.5p 30.9.04 - 30.9.08 +
+ The company's earnings per share must be equal to, or exceed by 6%, the growth
of RPI over the period determined by the remuneration committee, commencing no
earlier than the financial year in which the option was granted.
Corporate governance
The Combined Code of Best practice ('Combined Code') was published by the
Committee on Corporate Governance in June 1998 to address the principles of good
corporate governance.
The directors support the Combined Code but it is difficult for a company of
this size to implement all the proposals in the immediate future. As a company
listed on the Alternative Investment Market (AIM), rather than a company with a
full listing there is no requirement to comply with all aspects of corporate
governance. However the directors believe that it is in the best interest of
both shareholders and also the directors themselves to adhere as far as
practicable to the rules and recommendations set out in the Combined Code.
The Board has established Audit and Remuneration Committees under the Chairman.
The membership of both committees includes one non-executive director. The
Combined Code recommends that there are three non-executive directors, however
the directors believe that it is not in the interest of the shareholders to
appoint a committee consisting of three non-executive directors for the sole
purpose of compliance with the Combined Code.
Substantial interests
The directors have been notified of the following substantial shareholdings in
excess of 3% in the ordinary share capital of the company as at 1 September
2003.
Ordinary shares of 1p Percentage
Mr W Ward 5,014,881 29.2
Sir Robin Knox-Johnson 1,876,608 10.9
Stasson Investments 1,742,405 10.1
Close Bros VCT 1,164,000 6.8
Chelverton Growth Trust Plc 1,073,295 6.2
Close Bros Protected VCT 828,400 4.8
Policy on the payment of creditors
It is company policy to agree appropriate terms and conditions for its
transactions with suppliers and that payment should be made in accordance with
those terms and conditions, provided that the supplier has also complied with
them. At 30 April 2003, the company had an average of 51 days purchases
outstanding in trade creditors.
Directors' responsibilities
Company law requires the directors to prepare financial statements for each
financial year which give a true and fair view of the state of affairs of the
company at the end of the year and of the profit or loss for the year then
ended. In preparing those financial statements, the directors are required to:
select suitable accounting policies, and then apply them consistently;
make judgements and estimates that are reasonable and prudent;
state whether applicable accounting standards have been followed, subject to
any material departures disclosed and explained in the financial statements; and
prepare the financial statements on the going concern basis unless it is
inappropriate to presume that the company will continue in business.
The directors are responsible for keeping proper accounting records which
disclose with reasonable accuracy at any time the financial position of the
company and to enable them to ensure that the financial statements comply with
the Companies Act 1985. The directors are also responsible for safeguarding the
assets of the company and hence for taking reasonable steps for the prevention
and detection of fraud and other irregularities.
Auditors
A resolution to re-appoint MacIntyre Hudson as auditors for the ensuing year
will be proposed at the annual general meeting.
Registered office: Signed by order of the directors
Shamrock Quay
William Street
Northam
Southampton
SO14 5QL
Mr J Knight
Company Secretary
Approved by the directors on 29th October 2003
We have audited the financial statements of Clipper Ventures Plc for the year
ended 30 April 2003 which comprise the Profit and Loss Account, Balance Sheet,
Cash Flow Statement, Accounting Policies and the related notes. These financial
statements have been prepared under the historical cost convention and on the
basis of the accounting policies set out therein.
This report is made solely to the company's members, as a body, in accordance
with Section 235 of the Companies Act 1985. Our audit work has been undertaken
so that we might state to the company's members those matters we are required to
state to them in an auditors' report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume responsibility to anyone
other than the company and the company's members as a body, for our audit work,
for this report, or for the opinions we have formed.
Respective responsibilities of the directors and the auditors
The directors' responsibilities for preparing the Annual Report and the
financial statements in accordance with applicable United Kingdom law and
Accounting Standards are set out in the Statement of Directors'
Responsibilities.
Our responsibility is to audit the financial statements in accordance with
relevant legal and regulatory requirements and United Kingdom Auditing
Standards.
We report to you our opinion as to whether the financial statements give a true
and fair view and are properly prepared in accordance with the Companies Act
1985. We also report to you if, in our opinion, the Directors' Report is not
consistent with the financial statements, if the company has not kept proper
accounting records, if we have not received all the information and explanations
we require for our audit, or if information specified by law regarding
directors' remuneration and transactions with the company is not disclosed.
We read other information contained in the Annual Report, and consider whether
it is consistent with the audited financial statements. This other information
comprises only the Director's Report and the Chairman's Statement. We consider
the implications for our report if we become aware of any apparent misstatements
or material inconsistencies with the financial statements. Our responsibilities
do not extend to any other information beyond that referred to in this
paragraph.
Basis of audit opinion
We conducted our audit in accordance with United Kingdom Auditing Standards
issued by the Auditing Practices Board.
An audit includes examination, on a test basis, of evidence relevant to the
amounts and disclosures in the financial statements. It also includes an
assessment of the significant estimates and judgements made by the directors in
the preparation of the financial statements, and of whether the accounting
policies are appropriate to the company's circumstances, consistently applied
and adequately disclosed.
We planned and performed our audit so as to obtain all the information and
explanations which we considered necessary in order to provide us with
sufficient evidence to give reasonable assurance that the financial statements
are free from material misstatement, whether caused by fraud or other
irregularity or error. In forming our opinion we also evaluated the overall
adequacy of the presentation of information in the financial statements.
Fundamental uncertainty
In forming our opinion, we have considered the directors' assertion in note 1
that sufficient funding will be available to finance the company's operations
for the foreseeable future, including the purchase of 10 new yachts. In view of
the significance of the fact that the preparation of the financial statements on
the going concern basis assumes that this finance will be available, we consider
that this assertion should be brought to your attention, but our opinion is not
qualified in this respect.
Opinion
In our opinion the financial statements give a true and fair view of the state
of the company's affairs as at 30 April 2003 and of its loss for the year then
ended, and have been properly prepared in accordance with the Companies Act
1985.
Peterbridge House MACINTYRE HUDSON
The Lakes Chartered Accountants
Northampton & Registered Auditors
NN4 7HB
29th October 2003
2003 2003 2002
Continuing Discontinued
operations operations Note Total Total
# # # #
Turnover 2,587,242 212,244 3 2,799,486 2,246,664
Cost of 1,273,069 461,411 3 1,734,480 1,551,890
sales
--------------- --------------- --------------- ---------------
Gross profit/ 1,314,173 (249,167) 1,065,006 694,774
(loss)
Net 1,260,219 120,972 3 1,381,191 891,009
operating
expenses
--------------- --------------- --------------- ---------------
Operating 53,954 (370,139) 4 (316,185) (196,235)
profit/
(loss)
--------------- --------------- --------------- ---------------
Profit/(loss) 53,954 (370,139) (316,185) (196,235)
on ordinary
activities
before
interest
=============== ===============
Interest receivable - 368
Interest payable and similar charges 7 (151,707) (117,674)
------------- ------------
Loss on ordinary activities before taxation (467,892) (313,541)
Tax on loss on ordinary activities 8 - -
-------------- -----------
Loss for the financial year #(467,892) #(313,541)
============== ===========
Earnings per ordinary share (pence) 9 (3.44) (2.35)
============ ===========
The company has no recognised gains or losses other than the
results for the year as set out above.
Balance Sheet
30 April 2003
2003 2002
Note # # # #
Fixed assets
Intangible assets 10 103,186 109,475
Tangible assets 11 2,340,038 2,703,822
Investments 12 29,401 29,401
--------------- ---------------
2,472,625 2,842,698
Current assets
Stocks 13 140,464 163,538
Debtors due within one 14 1,863,344 2,411,818
year
Debtors due after one 14 178,602 630,096
year
Cash in hand 1,004 347
--------------- ---------------
2,183,414 3,205,799
Creditors: amounts falling 15 3,661,906 3,971,833
due within one year
--------------- ---------------
Net current liabilities (1,478,492) (766,034)
--------------- ---------------
Total assets less current liabilities 994,133 2,076,664
Creditors: amounts falling due after 16 375,000 1,419,353
more than one year
--------------- ---------------
#619,133 #657,311
=============== ===============
Capital and reserves
Called-up share capital 23 367,114 328,652
Share premium account 24 2,500,415 2,109,163
Profit and Loss Account 25 (2,248,396) (1,780,504)
--------------- ---------------
619,133 657,311
=============== ===============
Shareholders' funds: 26
Equity #423,867 #462,045
Non-equity #195,266 #195,266
--------------- ---------------
#619,133 #657,311
=============== ===============
These financial statements were approved by the directors on the 29th October
2003 and are signed on their behalf by:
Jeremy Knight
Director
Cash Flow Statement
Year ended 30 April 2003
2003 2002
# # #
Net cash inflow/(outflow) from operating activities 124,052 (384,638)
Returns on investments and servicing of finance
Interest received - 368
Interest paid (150,846) (116,601)
Interest element of hire purchase (885) (1,073)
--------------- ---------------
Net cash outflow from returns on (151,731) (117,306)
investments and servicing of
finance
Capital expenditure
Payments to acquire tangible fixed (54,634) (8,986)
assets
Receipts from sale of fixed assets - 3,498
--------------- ---------------
Net cash outflow from capital (54,634) (5,488)
expenditure
Acquisitions and disposals
--------------- -------------
Cash outflow before financing (82,313) (507,432)
Financing
Issue of equity share capital 38,462 450
Share premium on issue of equity 461,538 17,550
share capital
Share issue costs (70,286) -
Issue of convertible loan notes 375,000 -
Movement on bank loans 251,308 (180,342)
Capital element of hire purchase (8,200) (207)
--------------- ---------------
Net cash (outflow)/inflow from 1,047,822 (162,549)
financing
Increase/(decrease) in cash #965,509 #(669,981)
============ ============
Reconciliation of operating loss to net cash outflow from operating activities
2003 2002
# #
Operating loss (316,185) (196,235)
Amortisation 6,289 -
Depreciation 281,587 260,786
Profit on disposal of fixed assets - (1,665)
Impairment provision 136,831 -
Decrease in stocks 23,074 38,692
Decrease/(increase) in debtors 999,968 (759,530)
(Decrease)/increase in creditors (1,007,512) 273,314
--------------- ---------------
Net cash inflow/(outflow) from operating #124,052 #(384,638)
activities
=============== ===============
Reconciliation of net cash flow to movement in net debt
2003 2002
# # #
Increase/(decrease) in cash in 965,509 (669,981)
the period
Net cash inflow from convertible (375,000) -
loan notes
Net cash (inflow)/outflow from (251,307) 180,342
bank loans
Cash outflow in respect of hire 8,200 207
purchase
--------------- ---------------
Change in net debt 347,402 (489,342)
--------------- ---------------
Net debt at 1 May 2002 (2,011,343) (1,522,011)
--------------- --------------
Net debt at 30 April 2003 #(1,663,941) #(2,011,343)
============== ===============
Analysis of changes in net debt
At At
1 May 2002 Cash flows 30 Apr 2003
# # #
Net cash:
Cash in hand and at bank 347 657 1,004
Overdrafts (1,701,079) 964,852 (736,227)
--------------- --------------- ---------------
(1,700,732) 965,509 (735,223)
--------------- --------------- ---------------
Debt:
Debt due within one year (149,099) (401,901) (551,000)
Debt due after one year (150,594) (224,406) (375,000)
Hire purchase agreements (10,918) 8,200 (2,718)
--------------- --------------- ---------------
(310,611) (618,107) (928,718)
--------------- --------------- ---------------
Net debt #(2,011,343) #347,402 #(1,663,941)
=============== =============== ===============
Basis of accounting
The financial statements have been prepared under the historical cost
convention, and in accordance with applicable accounting standards.
Recognition of race income and expenditure
Where the duration of a race involves more than one accounting period, the
income and expenditure relating to that race is allocated to the accounting
period on the basis of race completion.
Sponsorship
Sponsorship income and expenditure is recognised to match with the timing of the
activity generating the income.
Turnover
Race income is included in turnover on the basis of the accounting polices
described above. Turnover also includes other amounts invoiced during the year,
excluding Value Added Tax.
Amortisation
Amortisation is calculated so as to write off the cost of an asset over the
useful economic life of that asset as follows:
Goodwill - Straight line over 20 years
Depreciation
Depreciation is calculated so as to write off the cost of an asset, less its
estimated residual value, over the useful economic life of that asset as
follows:
Yachts - Straight line over 6 to 10 years
Motor vehicles - Straight line over 5 years
Equipment - Straight line over 5 years
Depreciation on race yachts is treated as a race cost and charged to the profit
and loss account on the basis of race completion.
Impairment reviews
The carrying values of tangible fixed assets are reviewed for impairment if
events or changes in circumstances indicate that the carrying value may not be
recoverable.
Investments
Investments are disclosed at cost unless the directors consider a permanent
diminution in value has occurred.
Stocks
Stocks are valued at the lower of cost and net realisable value, after making
due allowance for obsolete and slow moving items.
Hire purchase agreements
Assets held under hire purchase agreements are capitalised and disclosed under
tangible fixed assets at their fair value. The capital element of the future
payments is treated as a liability and the interest is charged to the Profit and
Loss Account.
Operating lease agreements
Rentals applicable to operating leases where substantially all of the benefits
and risks of ownership remain with the lessor are charged against profits on a
straight line basis over the period of the lease.
Pension costs
The company operates a defined contribution pension scheme for employees. The
assets of the scheme are held separately from those of the company. The annual
contributions payable are charged to the Profit and Loss Account.
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 have occurred at that date that will result in an obligation to pay more,
or a right to pay less or to receive more, tax, with the following exception:
Deferred tax assets are recognised only to the extent that the directors
consider that it is more likely than not that there will be suitable taxable
profits from which the future reversal of the underlying timing differences can
be deducted.
Deferred tax is measured on an undiscounted basis at the tax rates that are
expected to apply in the periods in which timing differences reverse, based on
tax rates and laws enacted or substantively enacted at the balance sheet date.
Foreign currencies
Assets and liabilities in foreign currencies are translated into sterling at the
rates of exchange ruling at the balance sheet date. Transactions in foreign
currencies are translated into sterling at the rate of exchange ruling at the
date of the transaction. Exchange differences are taken into account in arriving
at the operating profit.
1. Going Concern
The directors consider that sufficient funds are available to the company for
its operations in the foreseeable future. Additional finance will be required
for the purchase of 10 new 68 foot yachts, and although that funding is not
currently in place, the directors are confident that this funding will be made
available to the company. Accordingly the directors have prepared the accounts
on a going concern basis.
2. Turnover
An analysis of turnover is given below:
2003 2002
# #
Crew income 1,852,710 1,714,521
Charter income 211,892 398,293
Sponsorship income 673,706 60,000
Other income 61,178 73,850
--------------- -------------
United Kingdom 2,799,486 2,246,664
=============== ===============
3. Comparative figures
The analysis between continuing and discontinued operations for the year ended
30 April 2002 is shown below.
Continuing Discontinued Total
# # #
Turnover 1,787,857 458,807 2,246,664
Cost of sales 1,148,888 403,002 1,551,890
--------------- --------------- ---------------
Gross profit 638,969 55,805 694,774
=============== =============== ===============
Administrative expenses 726,684 164,325 891,009
--------------- --------------- ---------------
Operating loss #(87,715) #(108,520) #(196,235)
=============== =============== ===============
4. Operating profit/(loss)
Operating profit/(loss) is stated after charging/(crediting):
2003 2002
# #
Amortisation 6,289 -
Depreciation 231,319 260,786
Impairments 136,831 -
Profit on disposal of fixed assets - (1,665)
Auditors' remuneration
- as auditors 13,500 13,500
=============== ===============
5. Particulars of employees
The average number of staff employed by the company during the financial
year amounted to:
2003 2002
No No
Management 4 4
Administrative 15 16
Yacht personnel 20 19
-------------- --------------
39 39
============== ==============
The aggregate payroll costs of the above were:
2003 2002
# #
Wages and salaries 871,247 791,341
Social security costs 83,399 65,130
Other pension costs 25,595 16,560
--------------- ---------------
#980,241 #873,031
=============== ===============
6. Directors' emoluments
The directors' aggregate emoluments in respect of qualifying services
were:
2003 2002
# #
Emoluments receivable 252,730 239,561
=============== ===============
Emoluments of highest paid director:
2003 2002
# #
Total emoluments (excluding pension 70,111 69,765
contributions):
=============== ===============
The number of directors who are accruing benefits under company pension
schemes was as follows:
2003 2002
No No
Money purchase schemes 3 3
============== ==============
7. Interest payable and similar charges
2003 2002
# #
Interest payable on bank borrowing 107,473 26,557
Finance charges 2,111 1,073
Other similar charges payable 42,123 90,044
--------------- ---------------
#151,707 #117,674
=============== ===============
8. Tax on loss on ordinary activities
Factors affecting current tax charge
The tax assessed on the loss on ordinary activities for the year is
higher than the standard rate of corporation tax in the UK of 20% (2002 - 20%).
2003 2002
# #
Loss on ordinary activities before taxation (467,892) (313,541)
=============== ===============
Losses by rate of tax (93,578) (62,708)
Permanent and timing differences - 1,805
Timing difference between depreciation and 2,060 (1,806)
capital allowances
Impairment of Clipper 38 ft yachts 27,366 -
Losses carried forward 64,152 62,709
--------------- ---------------
Total current tax - -
=============== ===============
9. Earnings per share
2003 2002
pence pence
Earnings per ordinary share (3.44) (2.35)
=============== ===========
Earnings per share have been calculated on the net basis on the loss on
ordinary activities after taxation of #(467,892) (2002 - #(313,541)) using the
average number of ordinary shares in issue of 13,591,467 (2002 - 13,321,185).
There is no dilutive effect of the options and warrants on the results
for the period ended 30 April 2003.
10. Intangible fixed assets
Goodwill
#
Cost
At 1 May 2002 and At 30 April 2003 #109,475
===============
Amortisation
Charge for the year 6,289
---------------
At 30 April 2003 #6,289
===============
===============
Net book value
At 30 April 2003 103,186
===============
At 30 April 2002 109,475
===============
Representing goodwill on acquisition of the Around Alone race.
11. Tangible fixed assets
Yachts Motor Office Assets in Total
Vehicles Equipment course of
construction
# # # # #
Cost
At 1 May 2002 3,597,395 30,300 116,797 - 3,744,492
Additions 29,258 - 7,201 18,175 54,634
Impairments (136,831) - - - (136,831)
--------------- --------------- --------------- --------------- ---------------
At #3,489,822 #30,300 #123,998 #18,175 #3,662,295
30 April 2003
=============== =============== =============== =============== ===============
Depreciation
At 1 May 2002 983,150 11,169 46,351 - 1,040,670
Charge for the 252,633 6,060 22,894 - 281,587
year
--------------- --------------- --------------- -------------- ---------------
At #1,235,783 #17,229 #69,245 - #1,322,257
30 April 2003
=============== =============== =============== ============== ===============
Net book value
At 2,254,039 13,071 54,753 18,175 2,340,038
30 April 2003
=============== =============== =============== =============== ===============
At 2,614,245 19,131 70,446 - 2,703,822
30 April 2002
=============== =============== =============== =============== ===============
Change in Accounting Policy
Depreciation on the 60 ft yachts has been charged to the profit and loss
account on the basis of race completion, this treatment being consistent with
other race costs, as disclosed in the accounting policies. In prior years
depreciation was charged on a straight line basis.
The reclassification constitutes a change in accounting policy and in
accordance with FRS 3, 'Reporting Financial Performance' a prior year adjustment
would be required. However there is no financial effect of the change in policy
on the prior year results. The change in policy has reduced the depreciation
charge this year by #29,000.
Impairment
The 38 ft yachts have been used for corporate events and training, an
activity that the directors have now discontinued. Eight of the ten 38 ft yachts
were sold immediately after the year end for proceeds of #520,000. To recognise
the difference between the carrying value and the net realisable value of the
yachts the directors have included an impairment provision of #136,831. This has
been included within cost of sales in the profit and loss account.
Yachts
It is the company's intention to sell the current fleet of 60 ft yachts
used for the 'Round the World Race'. On 27 May 2003 the company entered into an
agreement to purchase 10 replacement 68 'ft yachts for US$6,000,000. Expenditure
in respect of the new yachts is classified under 'Assets in the course of
construction'.
Hire purchase agreements
Included within the net book value of #2,340,038 is #5,554 (2002 -
#17,664) relating to assets held under hire purchase agreements. The
depreciation charged to the accounts in the year in respect of such assets
amounted to #1,550 (2002 - #4,604).
12. Investments
Listed
investments
#
Cost
At 1 May 2002 and 30 April 2003 29,401
===============
Net book value
At 30 April 2003 29,401
===============
At 30 April 2002 29,401
===============
The company owns 2,139,933, 0.25p ordinary shares representing less than
3% of the issued share capital of an AIM listed company. The market value of the
investment was #10,000 at 30 April 2003.
The company also holds 90% of the issued share capital in Clipper
Ventures Online Limited. The company is dormant with net liabilities. The
investment has not been consolidated as it is immaterial to the financial
statements.
13. Stocks
2003 2002
# #
Goods held for resale 140,464 163,538
=============== ===============
14. Debtors
2003 2002
# #
Trade debtors 90,170 1,632,267
VAT recoverable 9,149 -
Other debtors 10,636 46,953
Prepayments and accrued income 1,931,991 1,362,694
--------------- ---------------
#2,041,946 #3,041,914
=============== ===============
The debtors above include the following amounts falling due after more
than one year:
2003 2002
# #
Prepayments and accrued income 178,602 630,096
=============== ===============
15. Creditors: amounts falling due within one year
2003 2002
# #
Bank loans and overdrafts 1,287,229 1,850,178
Trade creditors 327,290 359,915
PAYE and social security 44,919 24,911
VAT - 11,233
Hire purchase agreements 2,718 8,906
Other creditors 50,458 36,217
Deferred income 1,511,498 1,666,973
Accruals 437,794 13,500
--------------- ---------------
#3,661,906 #3,971,833
=============== ===============
The following liabilities disclosed under creditors falling due within
one year are secured by the company:
2003 2002
# #
Bank loans and overdrafts 1,287,229 1,850,178
Hire purchase 2,718 8,906
--------------- ---------------
#1,289,947 #1,859,084
=============== ===============
Bank loans and overdrafts are secured by an unlimited debenture in the
bank's standard form.
In addition there is a first legal charge over all of the Clipper 60 ft
yachts (total of eight) along with all insurances and earnings related thereto,
together with a first legal charge over two of the ten Clipper 38 ft yachts.
The remaining eight Clipper 38 ft yachts are secured by a first and
second legal charge.
The hire purchase creditors are secured on the assets to which they
relate.
16. Creditors: amounts falling due after more than one year
2003 2002
# #
Debenture loans (convertible) 375,000 -
Bank loans and overdrafts - 150,594
Hire purchase agreements - 2,012
Deferred income - 1,266,747
--------------- ---------------
#375,000 #1,419,353
=============== ===============
Loan notes will be redeemed in 2008 at par value. Conversion of the loan
notes is at the option of the holder. The nominal value of the loan notes may be
converted into ordinary shares at a rate of 16p (or sale price if lower).
The following liabilities disclosed under creditors falling due after
more than one year are secured by the company:
2003 2002
# #
Bank loans and overdrafts - 150,594
Hire purchase - 2,012
--------------- ---------------
- #152,606
=============== ===============
Please refer to note 15 for details of security.
17. Creditors - capital instruments
Creditors include finance capital which is due for repayment as follows:
2003 2002
# #
In one year or less, or on demand 551,000 149,099
Between one and two years - 150,594
--------------- ---------------
#551,000 #299,693
=============== ===============
Financial Instruments
The company's financial instruments comprise cash, overdrafts and bank
loans that are used to meet its working capital requirements. As permitted by
FRS 13 'Derivatives and other financial instruments', short term trade debtors
and creditors are excluded from the disclosures.
Interest rate risk
The bank overdraft and bank loan are subject to interest of 6.75% per
annum. Interest on loans secured on the 38 'ft yachts is 5.75% per annum.
Interest on the convertible loan notes is 5.5% per annum.
Liquidity risk
It is and has been throughout the year under review the company's policy
that no speculative trading in financial instruments be undertaken.
There are no material differences between the fair value and the book
value of the financial instruments.
18. Commitments under hire purchase agreements
Future commitments under hire purchase agreements are as follows:
2003 2002
# #
Amounts payable within one year 2,718 8,906
Amounts payable between two and five years - 2,012
--------------- ---------------
#2,718 #10,918
=============== ===============
19. Deferred taxation
No provision has been made in the financial statements and the amounts
unprovided at the end of the year are as follows:
2003 2002
# #
Excess of taxation allowances over depreciation 512,389 573,657
on fixed assets
Tax losses available (1,065,313) (969,188)
--------------- ---------------
#(552,924) #(395,531)
=============== ===============
20. Commitments under operating leases
At 30 April 2003 the company had annual commitments under
non-cancellable operating leases as set out below.
2003 2002
Land & Other Items Land & Other Items
Buildings Buildings
# # # #
Operating
leases which
expire:
Within one 2,650 672 8,050 672
year
Within two to 10,032 3,666 10,032 4,308
five years
After more 38,912 - 11,576 -
than five
years
--------------- --------------- --------------- ---------------
#51,594 #4,338 #29,658 #4,980
=============== =============== =============== ===============
21. Transactions with the directors
Share issues
The following directors acquired additional shares during the year:
Consideration Shares
Mr W Ward #25,000 192,308
Mr R Knox-Johnson #25,000 192,308
Current accounts
At the year end the company owed the following balances to directors:
#
Mr W Ward 2,209
Mr R Knox-Johnson 1,108
Mr J Knight 2,167
Mr R Cooper 634
RIBS UK Limited
Mr W Ward is a director of RIBS UK Limited. At the year end the company
owed RIBS UK Limited #3,773 in respect of Clipper 2002 race costs.
22. Related party transactions
Except for the disclosure given in note 21 there were no related party
transactions during the year that are required to be disclosed under FRS 8,
Related party disclosures.
23. Share capital
Authorised share capital:
2003 2002
# #
250,000,000 Ordinary shares of #0.01 each 2,500,000 204,734
19,526,627 Deferred shares of #0.01 each 195,266 195,266
--------------- ---------------
#2,695,266 #400,000
=============== ===============
Allotted, called up and fully paid:
2003 2002
No. # No. #
Ordinary shares 17,184,724 171,847 13,338,569 133,386
of #0.01 each
Deferred shares 19,526,627 195,266 19,526,627 195,266
of #0.01 each
--------------- --------------- --------------- ---------------
36,711,351 #367,114 32,865,196 #328,652
=============== =============== =============== ===============
The following ordinary shares were allotted during the year:
Date of issue Nominal Value Number of Consideration
of shares shares issued received
07.04.03 1p 3,846,155 #500,000
Deferred shares
The 19,526,627 1p deferred shares do not entitle the holder to a
certificate in respect thereof or to payment of any dividend or other
distribution or to receive notice or attend or vote at any general meeting of
the company, or on return of the capital, to the repayment of the amount paid up
until after repayment of the capital paid up on the Ordinary Shares together
with a payment of #1,000,000 on each Ordinary Share and the Deferred Shares
shall not be capable of transfer at any time other than with the consent of the
directors. These deferred shares are therefore classified as non-equity shares.
Share Warrants
No share warrants were granted in the year.
Share options
As at 30 April 2003 options over ordinary share capital had been granted
as follows:-
Number of
options at Options Options Number of
01.05.02 in the year granted lapsed in the year options at 30.04.03 Option Exercisable
price
150,000 - - 150,000 40.0p 24.08.02 - 22.08.09 +
175,000 - - 175,000 40.0p 31.03.00 - 31.03.05 +
164,120 - - 164,120 45.5p 14.12.03 - 14.12.13 +
13,627 - - 13,627 45.5p 14.12.03 - 14.12.07 +
329,670 - - 329,670 45.5p 14.12.01 - 14.12.06 +
125,000 - - 125,000 50.0p 05.01.00 - 01.05.03
175,000 - - 175,000 55.0p 05.01.00 - 01.05.04
95,000 - - 95,000 60.0p 05.01.00 - 01.05.05
48,928 - - 48,928 70.0p 05.01.00 - 01.05.06
300,000 - - 300,000 32.5p 30.09.04 - 30.09.11 +
390,000 - - 390,000 32.5p 30.09.04 - 30.09.08 +
+ The company's earnings per share must be equal to, or exceed, by 6%
the growth of RPI over the period determined by the remuneration committee,
commencing no earlier than the financial year in which the option was granted.
24. Share premium account
2003 2002
# #
Balance brought forward 2,109,163 2,091,613
Premium on shares issued in the year 461,538 17,550
Share issue expenses (70,286) -
--------------- ---------------
Balance carried forward #2,500,415 #2,109,163
=============== ===============
25. Profit and loss account
2003 2002
# #
Balance brought forward (1,780,504) (1,466,963)
Accumulated loss for the financial year (467,892) (313,541)
--------------- ---------------
Balance carried forward #(2,248,396) #(1,780,504)
=============== ===============
26. Reconciliation of movements in shareholders' funds
Equity shareholders' funds
2003 2002
# # #
Loss for the financial year (467,892) (313,541)
New equity share capital 38,462 450
subscribed
Net premium on new share capital 391,252 17,550
subscribed
--------------- ---------------
#429,714 #18,000
Net reduction to funds #(38,178) #(295,541)
Opening shareholders' equity funds 462,045 757,586
--------------- ---------------
Closing shareholders' equity funds 423,867 462,045
=============== ===============
Non-equity shareholders' funds
Opening and closing shareholders' non-equity #195,266 #195,266
funds
=============== ===============
Total shareholders' funds 619,133 657,311
=============== ===============
NOTICE IS HEREBY GIVEN that the Annual General Meeting of the above named
Company will be held at Shamrock Quay, William Street, Northam, Southampton,
Hampshire, SO14 5QL, on 23 December 2003 at 9:00 am for the following purposes:
AS ORDINARY BUSINESS
1. To receive, consider and adopt the audited financial
statements of the Company for the 12 months ended 30 April 2003 and the
Directors' and Auditors' Report thereon.
2. Following the resignation of Macintyre Hudson, to appoint
Nexia Audit Limited of Notebeme House, 84 High Street, Southampton as auditors
to the Company and to authorise the directors to determine their remuneration.
3. To re-elect as a director Mr Robert Dench who has been
appointed since the last Annual General Meeting and therefore retires and offers
himself for re-election.
AS SPECIAL BUSINESS
To consider and, if thought fit, pass the following resolutions which will be
proposed as to Resolution 4, as an Ordinary Resolution and as to Resolution 5,
as a Special Resolution.
ORDINARY RESOLUTION
4. THAT, in substitution for all existing authorities in that
regard, the Directors be generally and unconditionally authorised in accordance
with section 80(1) of the Companies Act 1985("the Act") to allot relevant
securities (within the meaning of section 80 (2) of the Act) in the capital of
the Company up to an aggregate nominal amount of #300,000 such authority to
expire on the date of the next Annual General Meeting of the Company or, if
earlier, 15 months after the date of passing this Resolution PROVIDED THAT the
Company may before such expiry make an offer or agreement which would or might
require relevant securities to be allotted in pursuance of such offer or
agreement notwithstanding that the authority conferred by this resolution has
expired.
SPECIAL RESOLUTION
5. THAT, in substitution for all existing authorities in that
regard, the Directors be and they are hereby empowered pursuant to section 95 of
the Act to allot equity securities (as defined in Section 94(2) of the Act) for
cash pursuant to the authority conferred by Resolution 4 above as if section 89
(1) of the Act did not apply to any such allotments, PROVIDED THAT this power
shall be limited:
(a) to the allotment of equity securities in connection with a
rights issue or other pre-emptive issue of shares in favour of the holders of
Ordinary Shares in the capital of the Company where the equity securities
respectively attributable to the interests of all holders of Ordinary Shares are
proportionate (as nearly as may be) to the respective number of Ordinary Shares
held by them but subject to such exclusions or arrangements of the Directors as
may be necessary or expedient to deal with fractional entitlements arising or
any legal or practical problems under the laws of any overseas territory or the
requirements of any regulatory body or exchange or otherwise; and
(b) to the allotment (otherwise than pursuant to sub-paragraph
(a) above) of equity securities to an aggregate nominal value of #250,000.
and such power shall expire at the date of the next Annual General Meeting of
the Company or 15 months after the date of passing this resolution (whichever is
earlier) but so that the Company may, before such expiry, make an offer or
agreement which would or might require equity securities to be allotted after
such expiry and the Directors may allot equity securities in pursuance of such
offer or agreement as if the power hereby conferred had not expired.
Registered Office:
Shamrock Quay
William Street
Northam
Southampton
Hampshire SO14 5QL
Notes:
1. A member entitled to attend and vote at the Meeting may
appoint one or more proxies to attend and, on a poll, vote instead of him. A
proxy need not also be a member. A form of proxy is enclosed.
2. The form of proxy, if used, and the power of attorney or
other authority (if any) under which it is signed (or a certified copy of such
power or authority) must be lodged with the Company's registrars, Capita IRG
Plc, Northern House, Woodsome Park, Fenay Bridge, Huddersfiled, HD8 0LA, not
less than 48 hours before the time fixed for holding the meeting.
3. Completing and returning the form of proxy will not
preclude a member from attending in person at the meeting and voting should he
or she wish to do so.
4. In the case of a corporation, the form of proxy must be
executed under its common seal or the hand of an officer or attorney duly
authorised.
5. There will be available for inspection at the Company's
registered office between the hours of 9.00 a.m. and 5.00 p.m. from the date of
this notice until the date of the meeting (Saturdays, Sundays and public
holidays excluded) and at the place of the meeting from 09:00 a.m. until the
conclusion of the meeting:
(a) copies of all contracts of service of the directors with the
Company or with any of its subsidiaries; and
(b) the register of directors' interests maintained under Section
325 Companies Act 1985.
BY THE ORDER OF THE BOARD
Jeremy Knight
SECRETARY
29th October 2003
END
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