TIDMCSB
RNS Number : 1734J
Crosby Asset Management Inc
25 March 2010
25 March 2010
Crosby Asset Management Inc.
(the "Company" and together with its subsidiaries the "Group" or "CAM")
Preliminary Results - Year Ended 31 December 2009
Highlights 2009
· Turnover - US$3.5 million (2008: US$22.9 million) for continuing operations
· Loss attributable to shareholders - US$10.9 million (2008: US$56.5 million)
· Shareholders' capital deficiency - US$1.0million (2008: Shareholders'
equity - US$8.2 million)
· Total equity - US$0.04 million (2008: US$9.83 million)
· Loss per share (basic) 2009: US$0.04 (2008: US$0.23)
· Assets under management - US$0.5 billion (2008: US$0.5billion)
Chairman's Report
2009 was another year of losses for Crosby Asset Management, albeit less severe
than those of 2008. The Company has continued to suffer from the consequences
of our unfortunate and ill-timed acquisition of Forsyth Partners in 2007 and
from the after-effects of the global market turndown of 2008/9.
Much of the management effort in 2009 was devoted to addressing the last issues
associated with the Crosby Forsyth funds. This task having been largely
completed, there was insufficient UK-based activity to justify the retention of
Simon Fry as our Chief Executive. He therefore offered to resign and his offer
was accepted by the board of CAM (the "Board") with effect from 31 January 2010.
I would like to thank him for his service to the Company. The remaining
businesses of the Company are largely in Asia, where they are managed by Johnny
Chan, who has therefore taken over as our CEO and rejoined the Board of CAM.
Various other steps have also been taken to reduce costs, to match the reduced
scale of the Company's operations including halving of the remuneration of
Johnny Chan and outsourcing a number of functions to our 86.45 per cent. parent
company, Crosby Capital Limited ("CCL"), which is listed in Hong Kong. Costs are
now much better aligned with the Company's significantly reduced revenues.
The future strategy of CAM, which is currently under active consideration by the
Board, is likely to be significantly influenced by decisions to be taken by the
board of CCL, the Company's parent. The Boards intention is to investigate a
Group restructuring, with the support of CCL, such that CAM can develop a
revitalised business model and, as soon as that review has been completed, the
Board will communicate its decisions to shareholders.
I would like to thank the remaining staff of CAM for their loyalty and continued
hard work during a challenging period in the Group's history.
Robert Owen
Chairman
Chief Executive Officer's Report
2009 was a year of consolidation for Crosby Asset Management, in which we have
been working on the closure of the Crosby Forsyth range of funds and the removal
of the associated liabilities and costs of operating these funds. I can now
report that CAM has now either closed the majority of the remaining Crosby
Forsyth Funds or has transferred the management of the funds to Apollo Multi
Asset Management LLP ("Apollo"), including the Forsyth Managed and Institutional
Property Funds, in an effort to rid ourselves of the uneconomic costs in
managing these funds.
During the year, CAM also took the decision to discontinue its joint venture
with Apollo and, as a result, withdrew as a partner with effect from 31 August
2009. At that time it was agreed that the regulatory capital that had been
provided by CAM and a loan that had been provided to Apollo for working capital
purposes would be repaid.
Our asset management interests now revolve around our long established Asian
based businesses.
Our Wealth Management business in Hong Kong continued to stabilise during 2009
and saw modest growth in Assets Under Management ("AUM") which now stands at
over US$400 million, an uptick from the previous quarter, as we witness a modest
rebound in the Asian stock markets. We have also added a new custodian
relationship with the Development Bank of Singapore in the last quarter,
principally to attract clients from China. Crosby Wealth Management is
proceeding with its defence of legal proceedings brought by one client in Hong
Kong concerning a trade execution error.
Our Active Opportunities Fund, which has been severely hurt during the small cap
retrenchment in Asia and from a lack of critical mass, is being gradually
reduced to return cash to our investors. We are progressively monetising the
remaining positions and aim to complete a capital return to investors as soon as
possible.
Crosby Asset Management (Hong Kong) Limited continues to act as manager of the
HKSAR Government Applied Research Fund and the China Chip Fund, as well as the
joint manager with JAIC on the JAIC Crosby Private Equity Fund.
At Orchard Petroleum ("Orchard") production has remained stable, although its
drilling operations have been funded by taking on debt. Orchard is currently in
negotiations with its key creditor regarding the repayment of the debt, and as a
result, its outlook is unclear. Crosby is a small minority shareholder in
Orchard and therefore not directly able to influence these negotiations. As a
result, it is not possible to determine what the potential outcome or value of
the investment might be in the future. We will provide updates as soon as they
become available.
Throughout 2009 we have been successful in reducing the cost base of Crosby
Asset Management by both contracting back the operational functions required by
us from CCL and by aggressively reducing our fixed overheads. Accordingly,
operating costs were reduced to US$11.2 million in 2009, compared to US$47.6
million in 2008.
Going forward, we will continue to seek savings in order to reduce the cost base
further and will continue our efforts to rebuild AUM and profitability at Crosby
Wealth Management.
At the end of January 2010, Simon Fry resigned as Chief Executive Officer of
CAM, a role he had held since CAM joined AIM in 2004, due to the discontinuance
of the great majority of the Company's UK-based activities. As from February
2010, I assumed the role of CEO and rejoined the board of CAM Inc.
Whilst disappointing not to be able to report any significant progress in the
rebuilding of CAM's business model, we have been able to reduce costs and
operating losses and we will continue to reduce costs and liabilities wherever
possible. I trust that the resurgence of the markets in Asia, principally China,
will continue to allow the rebuilding of our businesses in Asia at a faster pace
than in the UK.
Johnny Chan
Chief Executive Officer
Consolidated Income Statement
For the year ended 31 December 2009
+-----------------------------------------+-------+----------+----------+-+
| | | 2009 | 2008 | |
+-----------------------------------------+-------+----------+----------+-+
| |Notes | US$'000 | US$'000 | |
+-----------------------------------------+-------+----------+----------+-+
| | | | | |
+-----------------------------------------+-------+----------+----------+-+
| Continuing Operations | | | | |
+-----------------------------------------+-------+----------+----------+-+
| | | | | |
+-----------------------------------------+-------+----------+----------+-+
| Revenue | | 3,505 | 22,853 | |
+-----------------------------------------+-------+----------+----------+-+
| Cost of sales | | (451) | (6,502) | |
+-----------------------------------------+-------+----------+----------+-+
| | | | | |
+-----------------------------------------+-------+----------+----------+-+
| | | | | |
+-----------------------------------------+-------+----------+----------+-+
| Gross profit | | 3,054 | 16,351 | |
+-----------------------------------------+-------+----------+----------+-+
| | | | | |
+-----------------------------------------+-------+----------+----------+-+
| Loss on financial assets at fair value | | (2,003) | (2,219) | |
| through profit or loss | | | | |
+-----------------------------------------+-------+----------+----------+-+
| Other income | | 617 | 1,299 | |
+-----------------------------------------+-------+----------+----------+-+
| | | | | |
+-----------------------------------------+-------+----------+----------+-+
| Administrative expenses | | | | |
+-----------------------------------------+-------+----------+----------+-+
| Restructuring expenses | 3 | (2,622) | (6,968) | |
+-----------------------------------------+-------+----------+----------+-+
| Amortisation of intangible assets | | - | (314) | |
+-----------------------------------------+-------+----------+----------+-+
| Impairment of intangible assets | | - | (8,930) | |
+-----------------------------------------+-------+----------+----------+-+
| Write off of intangible assets | | - | (468) | |
+-----------------------------------------+-------+----------+----------+-+
| Other administrative expenses | | (6,999) | (24,403) | |
+-----------------------------------------+-------+----------+----------+-+
| | | (9,621) | (41,083) | |
+-----------------------------------------+-------+----------+----------+-+
| | | | | |
+-----------------------------------------+-------+----------+----------+-+
| Distribution expenses | | (3) | (46) | |
+-----------------------------------------+-------+----------+----------+-+
| Impairment of available-for-sale | | (1,536) | - | |
| investments | | | | |
+-----------------------------------------+-------+----------+----------+-+
| Impairment of associates | | (389) | - | |
+-----------------------------------------+-------+----------+----------+-+
| Impairment of a jointly controlled | | (128) | - | |
| entity | | | | |
+-----------------------------------------+-------+----------+----------+-+
| Other operating expenses | | (1,612) | (6,508) | |
+-----------------------------------------+-------+----------+----------+-+
| | | | | |
+-----------------------------------------+-------+----------+----------+-+
| | | | | |
+-----------------------------------------+-------+----------+----------+-+
| Loss from operations | | (11,621) | (32,206) | |
+-----------------------------------------+-------+----------+----------+-+
| | | | | |
+-----------------------------------------+-------+----------+----------+-+
| Finance costs | | (112) | (201) | |
+-----------------------------------------+-------+----------+----------+-+
| Share of (losses)/profits of associates | | (42) | 24 | |
+-----------------------------------------+-------+----------+----------+-+
| Share of profits/(losses) of jointly | | 128 | (10) | |
| controlled entities | | | | |
+-----------------------------------------+-------+----------+----------+-+
| | | | | |
+-----------------------------------------+-------+----------+----------+-+
| | | | | |
+-----------------------------------------+-------+----------+----------+-+
| Loss before taxation | | (11,647) | (32,393) | |
+-----------------------------------------+-------+----------+----------+-+
| | | | | |
+-----------------------------------------+-------+----------+----------+-+
| Taxation | 4 | 59 | 127 | |
+-----------------------------------------+-------+----------+----------+-+
| | | | | |
+-----------------------------------------+-------+----------+----------+-+
| | | | | |
| Loss for the year from continuing | | (11,588) | (32,266) | |
| operations | | | | |
+-----------------------------------------+-------+----------+----------+-+
| | | | | |
+-----------------------------------------+-------+----------+----------+-+
| | | | | |
+-----------------------------------------+-------+----------+----------+-+
| Discontinued Operations | | | | |
+-----------------------------------------+-------+----------+----------+-+
| | | | | |
+-----------------------------------------+-------+----------+----------+-+
| Loss for the year from discontinued | 5 | - | (25,207) | |
| operations | | | | |
+-----------------------------------------+-------+----------+----------+-+
| | | | | |
+-----------------------------------------+-------+----------+----------+-+
| Loss for the year | | (11,588) | (57,473) | |
+-----------------------------------------+-------+----------+----------+-+
| | | | | |
+-----------------------------------------+-------+----------+----------+-+
| | | | | |
+-----------------------------------------+-------+----------+----------+-+
+-----------------------------------------+------+----------+----------+-+
| | | 2009 | 2008 | |
+-----------------------------------------+------+----------+----------+-+
| |Note | US$'000 | US$'000 | |
+-----------------------------------------+------+----------+----------+-+
| | | | | |
+-----------------------------------------+------+----------+----------+-+
| Attributable to: | | | | |
+-----------------------------------------+------+----------+----------+-+
| Owners of the Company | | | | |
+-----------------------------------------+------+----------+----------+-+
| Loss for the year from continuing | | (10,941) | (31,278) | |
| operations | | | | |
+-----------------------------------------+------+----------+----------+-+
| Loss for the year from discontinued | | - | (25,207) | |
| operations | | | | |
+-----------------------------------------+------+----------+----------+-+
| | | | | |
+-----------------------------------------+------+----------+----------+-+
| | | | | |
+-----------------------------------------+------+----------+----------+-+
| | | (10,941) | (56,485) | |
+-----------------------------------------+------+----------+----------+-+
| | | | | |
+-----------------------------------------+------+----------+----------+-+
| Minority interests | | | | |
+-----------------------------------------+------+----------+----------+-+
| Loss for the year from continuing | | (647) | (988) | |
| operations | | | | |
+-----------------------------------------+------+----------+----------+-+
| Loss for the year from discontinued | | - | - | |
| operations | | | | |
+-----------------------------------------+------+----------+----------+-+
| | | | | |
+-----------------------------------------+------+----------+----------+-+
| | | (647) | (988) | |
+-----------------------------------------+------+----------+----------+-+
| | | | | |
+-----------------------------------------+------+----------+----------+-+
| | | | | |
+-----------------------------------------+------+----------+----------+-+
| Loss for the year | | (11,588) | (57,473) | |
+-----------------------------------------+------+----------+----------+-+
| | | | | |
+-----------------------------------------+------+----------+----------+-+
| | | | | |
+-----------------------------------------+------+----------+----------+-+
| | | | | |
+-----------------------------------------+------+----------+----------+-+
| Dividend | | - | - | |
+-----------------------------------------+------+----------+----------+-+
| | | | | |
+-----------------------------------------+------+----------+----------+-+
| Loss per share for loss attributable to | 6 | | | |
| owners of the Company during the year | | US | US | |
| | | cents | cents | |
+-----------------------------------------+------+----------+----------+-+
| | | | | |
+-----------------------------------------+------+----------+----------+-+
| Basic | | | | |
+-----------------------------------------+------+----------+----------+-+
| Continuing operations | | (4.49) | (12.85) | |
+-----------------------------------------+------+----------+----------+-+
| Discontinued operations | | - | (10.35) | |
+-----------------------------------------+------+----------+----------+-+
| | | | | |
+-----------------------------------------+------+----------+----------+-+
| | | | | |
+-----------------------------------------+------+----------+----------+-+
| | | (4.49) | (23.20) | |
+-----------------------------------------+------+----------+----------+-+
| | | | | |
+-----------------------------------------+------+----------+----------+-+
| Diluted | | | | |
+-----------------------------------------+------+----------+----------+-+
| Continuing operations | | (4.49) | (12.85) | |
+-----------------------------------------+------+----------+----------+-+
| Discontinued operations | | - | (10.35) | |
+-----------------------------------------+------+----------+----------+-+
| | | | | |
+-----------------------------------------+------+----------+----------+-+
| | | | | |
+-----------------------------------------+------+----------+----------+-+
| | | (4.49) | (23.20) | |
+-----------------------------------------+------+----------+----------+-+
Consolidated Statement of Comprehensive Income
For the year ended 31 December 2009
+----------------------------------------+----+----------+----------+----------+
| | | 2009 | | 2008 |
+----------------------------------------+----+----------+----------+----------+
| | | US$'000 | | US$'000 |
+----------------------------------------+----+----------+----------+----------+
| | | | | |
+----------------------------------------+----+----------+----------+----------+
| Loss for the year | | (11,588) | | (57,473) |
+----------------------------------------+----+----------+----------+----------+
| Other comprehensive income: | | | | |
+----------------------------------------+----+----------+----------+----------+
| Exchange differences on translating | | 46 | | 47 |
| foreign operations | | | | |
+----------------------------------------+----+----------+----------+----------+
| Available-for-sale investments | | | | |
| Deficit on revaluation | | (810) | | (1,398) |
| Recycle to income statement: | | | | |
| Provision for impairment | | 1,536 | | - |
| Upon disposal | | 362 | | 155 |
+----------------------------------------+----+----------+----------+----------+
| Share of other comprehensive income | | (52) | | (187) |
| of associates | | | | |
+----------------------------------------+----+----------+----------+----------+
| Share of other comprehensive income | | 11 | | (5) |
| of jointly controlled entities | | | | |
+----------------------------------------+----+----------+----------+----------+
| | | | | |
+----------------------------------------+----+----------+----------+----------+
| Other comprehensive income for the | | 1,093 | | (1,388) |
| year, before and net of tax | | | | |
+----------------------------------------+----+----------+----------+----------+
| | | | | |
+----------------------------------------+----+----------+----------+----------+
| | | | | |
+----------------------------------------+----+----------+----------+----------+
| Total comprehensive income for the | | (10,495) | | (58,861) |
| year, before and net of tax | | | | |
+----------------------------------------+----+----------+----------+----------+
| | | | | |
+----------------------------------------+----+----------+----------+----------+
| Attributable to: | | | | |
+----------------------------------------+----+----------+----------+----------+
| Owners of the Company | | (9,848) | | (57,873) |
+----------------------------------------+----+----------+----------+----------+
| Minority interests | | (647) | | (988) |
+----------------------------------------+----+----------+----------+----------+
| | | | | |
+----------------------------------------+----+----------+----------+----------+
| | | | | |
+----------------------------------------+----+----------+----------+----------+
| Total comprehensive income for the | | (10,495) | | (58,861) |
| year, before and net of tax | | | | |
+----------------------------------------+----+----------+----------+----------+
Consolidated Statement of Financial Position
As at 31 December 2009
+-----------------------------------------+----+---------+----------+
| | | 2009 | 2008 |
+-----------------------------------------+----+---------+----------+
| | | US$'000 | US$'000 |
+-----------------------------------------+----+---------+----------+
| | | | |
+-----------------------------------------+----+---------+----------+
| ASSETS | | | |
+-----------------------------------------+----+---------+----------+
| | | | |
+-----------------------------------------+----+---------+----------+
| Non-current assets | | | |
+-----------------------------------------+----+---------+----------+
| Property, plant and equipment | | 373 | 387 |
+-----------------------------------------+----+---------+----------+
| Interests in associates | | - | 153 |
+-----------------------------------------+----+---------+----------+
| Interests in jointly controlled | | 16 | 307 |
| entities | | | |
+-----------------------------------------+----+---------+----------+
| Available-for-sale investments | | 291 | 1,625 |
+-----------------------------------------+----+---------+----------+
| Note receivable | | 508 | 485 |
+-----------------------------------------+----+---------+----------+
| Intangible assets | | 21 | 21 |
+-----------------------------------------+----+---------+----------+
| | | 1,209 | 2,978 |
+-----------------------------------------+----+---------+----------+
| | | | |
+-----------------------------------------+----+---------+----------+
| Current assets | | | |
+-----------------------------------------+----+---------+----------+
| Amounts due from parent and related | | 4 | 214 |
| companies | | | |
+-----------------------------------------+----+---------+----------+
| Trade and other receivables | | 1,121 | 3,424 |
+-----------------------------------------+----+---------+----------+
| Tax recoverable | | 74 | 82 |
+-----------------------------------------+----+---------+----------+
| Financial assets at fair value through | | 115 | 2,696 |
| profit or loss | | | |
+-----------------------------------------+----+---------+----------+
| Cash and cash equivalents | | 6,723 | 15,526 |
+-----------------------------------------+----+---------+----------+
| | | 8,037 | 21,942 |
+-----------------------------------------+----+---------+----------+
| | | | |
+-----------------------------------------+----+---------+----------+
| Total assets | | 9,246 | 24,920 |
+-----------------------------------------+----+---------+----------+
| LIABILITIES | | | |
+-----------------------------------------+----+---------+----------+
| | | | |
+-----------------------------------------+----+---------+----------+
| Current liabilities | | | |
+-----------------------------------------+----+---------+----------+
| Amounts due to parent and related | | (2) | - |
| companies | | | |
+-----------------------------------------+----+---------+----------+
| Trade and other payables | | (2,425) | (7,711) |
+-----------------------------------------+----+---------+----------+
| Deferred income | | (26) | (34) |
+-----------------------------------------+----+---------+----------+
| Provision for taxation | | - | (2,261) |
+-----------------------------------------+----+---------+----------+
| Obligations under finance leases | | (348) | (298) |
+-----------------------------------------+----+---------+----------+
| Provision for liabilities | | (6,209) | (4,219) |
+-----------------------------------------+----+---------+----------+
| | | (9,010) | (14,523) |
+-----------------------------------------+----+---------+----------+
| | | | |
+-----------------------------------------+----+---------+----------+
| Non-current liabilities | | | |
+-----------------------------------------+----+---------+----------+
| Loan payable | | (54) | (52) |
+-----------------------------------------+----+---------+----------+
| Obligations under finance leases | | (144) | (513) |
+-----------------------------------------+----+---------+----------+
| | | (198) | (565) |
+-----------------------------------------+----+---------+----------+
| | | | |
+-----------------------------------------+----+---------+----------+
| Total liabilities | | (9,208) | (15,088) |
+-----------------------------------------+----+---------+----------+
| | | | |
+-----------------------------------------+----+---------+----------+
| | | | |
+-----------------------------------------+----+---------+----------+
| EQUITY | | | |
+-----------------------------------------+----+---------+----------+
| | | | |
+-----------------------------------------+----+---------+----------+
| Share capital | | 2,435 | 2,435 |
+-----------------------------------------+----+---------+----------+
| Reserves | | (3,427) | 5,749 |
+-----------------------------------------+----+---------+----------+
| | | | |
| (Capital deficiency)/Equity | | (992) | 8,184 |
| attributable to owners of the Company | | | |
+-----------------------------------------+----+---------+----------+
| | | | |
+-----------------------------------------+----+---------+----------+
| Minority interests | | 1,030 | 1,648 |
+-----------------------------------------+----+---------+----------+
| | | | |
+-----------------------------------------+----+---------+----------+
| Total equity | | 38 | 9,832 |
+-----------------------------------------+----+---------+----------+
| | | | |
+-----------------------------------------+----+---------+----------+
| Total equity and liabilities | | 9,246 | 24,920 |
+-----------------------------------------+----+---------+----------+
Consolidated Statement of Changes in Equity
For the year ended 31 December 2009
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | Equity attributable to owners of the Company | Minority | Total |
| | |interests | equity |
+--------------------+-------------------------------------------------------------------------------------------+-----------+----------+
| | | | | Employee | | | | | | |
| | | | | share-based | Foreign | Investment | Profit | | | |
| | Share | Share | Capital | compensation | exchange | revaluation | and | | | |
| | capital | premium | reserve | reserve | reserve | reserve | loss | Total | | |
| | | | | | | | account | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | US$'000 | US$'000 | US$'000 | US$'000 | US$'000 | US$'000 | US$'000 | US$'000 | US$'000 | US$'000 |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | | | | | | | | | | |
| At 1 January | 2,433 | 6,236 | 23,455 | 2,927 | 165 | 155 | 28,834 | 64,205 | 8,269 | 72,474 |
| 2008 | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | | | | | | | | | | |
| Issue of new | | | | | | | | | | |
| shares upon | 2 | 108 | - | (26) | - | - | - | 84 | - | 84 |
| exercise | | | | | | | | | | |
| of share | | | | | | | | | | |
| options | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| Employee | | | | | | | | | | |
| share-based | - | - | - | 1,768 | - | - | - | 1,768 | 25 | 1,793 |
| compensation | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| Lapse of | - | - | - | (1,072) | - | - | 1,072 | - | - | - |
| share options | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| Dividend paid | | | | | | | | | | |
| to minority | - | - | - | - | - | - | - | - | (5,658) | (5,658) |
| shareholders | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | | | | | | | | | | |
| Transactions | 2 | 108 | - | 670 | - | - | 1,072 | 1,852 | (5,633) | (3,781) |
| with owners | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | | | | | | | | | | |
| Loss for the | - | - | - | - | - | - | (56,485) | (56,485) | (988) | (57,473) |
| year | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | | | | | | | | | | |
| Other | | | | | | | | | | |
| comprehensive | | | | | | | | | | |
| income: | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| Exchange | | | | | | | | | | |
| difference on | - | - | - | - | 47 | - | - | 47 | - | 47 |
| translating | | | | | | | | | | |
| foreign | | | | | | | | | | |
| exchange | | | | | | | | | | |
| operations | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| Available-for-sale | | | | | | | | | | |
| investments | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| Deficit on | - | - | - | - | - | (1,398) | - | (1,398) | - | (1,398) |
| revaluation | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| Recycle | | | | | | | | | | |
| to income | | | | | | | | | | |
| statement: | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | - | - | - | - | - | 155 | - | 155 | - | 155 |
| Upon disposal | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| Share of | | | | | | | | | | |
| other | - | - | - | - | (187) | - | - | (187) | - | (187) |
| comprehensive | | | | | | | | | | |
| income of | | | | | | | | | | |
| associates | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| Share of | | | | | | | | | | |
| other | | | | | | | | | | |
| comprehensive | - | - | - | - | (5) | - | - | (5) | - | (5) |
| income of | | | | | | | | | | |
| jointly | | | | | | | | | | |
| controlled | | | | | | | | | | |
| entities | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | | | | | | | | | | |
| Total | | | | | | | | | | |
| comprehensive | - | - | - | - | (145) | (1,243) | (56,485) | (57,873) | (988) | (58,861) |
| income for | | | | | | | | | | |
| the year | | | | | | | | | | |
| | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | | | | | | | | | | |
| At | 2,435 | 6,344 | 23,455 | 3,597 | 20 | (1,088) | (26,579) | 8,184 | 1,648 | 9,832 |
| 31 December | | | | | | | | | | |
| 2008 | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | | | |
| | Equity attributable to owners of the Company | Minority | Total |
| | |interests | equity |
+--------------------+-------------------------------------------------------------------------------------------+-----------+----------+
| | | | | Employee | | | | | | |
| | | | | share-based | Foreign | Investment | Profit | | | |
| | Share | Share | Capital | compensation | exchange | revaluation | and | | | |
| | capital | premium | reserve | reserve | reserve | reserve | loss | Total | | |
| | | | | | | | account | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | US$'000 | US$'000 | US$'000 | US$'000 | US$'000 | US$'000 | US$'000 | US$'000 | US$'000 | US$'000 |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | | | | | | | | | | |
| At 1 January | 2,435 | 6,344 | 23,455 | 3,597 | 20 | (1,088) | (26,579) | 8,184 | 1,648 | 9,832 |
| 2009 | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| Employee | | | | | | | | | | |
| share-based | - | - | - | 672 | - | - | - | 672 | 29 | 701 |
| compensation | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| Lapse of | - | - | - | (1,015) | - | - | 1,015 | - | - | - |
| share options | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | | | | | | | | | | |
| Transactions | - | - | - | (343) | - | - | 1,015 | 672 | 29 | 701 |
| with owners | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | | | | | | | | | | |
| | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | | | | | | | | | | |
| Loss for the | - | - | - | - | - | - | (10,941) | (10,941) | (647) | (11,588) |
| year | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| Other | | | | | | | | | | |
| comprehensive | | | | | | | | | | |
| income: | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| Exchange | | | | | | | | | | |
| difference on | - | - | - | - | 46 | - | - | 46 | - | 46 |
| translating | | | | | | | | | | |
| foreign | | | | | | | | | | |
| exchange | | | | | | | | | | |
| operations | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| Available-for-sale | | | | | | | | | | |
| investments | - | - | - | - | - | (810) | - | (810) | - | (810) |
| Deficit on | | | | | | | | | | |
| revaluation | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| Recycle to | | | | | | | | | | |
| income | - | - | - | - | - | 1,536 | - | 1,536 | - | 1,536 |
| statement: | - | - | - | - | - | 362 | - | 362 | - | 362 |
| Provision | | | | | | | | | | |
| for | | | | | | | | | | |
| impairment | | | | | | | | | | |
| Upon | | | | | | | | | | |
| disposal | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| Share of | | | | | | | | | | |
| other | - | - | - | - | (52) | - | - | (52) | - | (52) |
| comprehensive | | | | | | | | | | |
| income of | | | | | | | | | | |
| associates | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| Share of | | | | | | | | | | |
| other | | | | | | | | | | |
| comprehensive | - | - | - | - | 11 | - | - | 11 | - | 11 |
| income of | | | | | | | | | | |
| jointly | | | | | | | | | | |
| controlled | | | | | | | | | | |
| entities | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | | | | | | | | | | |
| Total | | | | | | | | | | |
| comprehensive | - | - | - | - | 5 | 1,088 | (10,941) | (9,848) | (647) | (10,495) |
| income for | | | | | | | | | | |
| the year | | | | | | | | | | |
| | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | | | | | | | | | | |
| At | 2,435 | 6,344 | 23,455 | 3,254 | 25 | - | (36,505) | (992) | 1,030 | 38 |
| 31 December | | | | | | | | | | |
| 2009 | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
| | | | | | | | | | | |
+--------------------+---------+---------+---------+--------------+----------+-------------+----------+----------+-----------+----------+
Consolidated Statement of Cash Flow
For the year ended 31 December 2009
+----------------------------------------+-----+----------+----------+
| | | 2009 | 2008 |
+----------------------------------------+-----+----------+----------+
| | | US$'000 | US$'000 |
+----------------------------------------+-----+----------+----------+
| | | | |
+----------------------------------------+-----+----------+----------+
| Operating activities | | | |
+----------------------------------------+-----+----------+----------+
| | | | |
+----------------------------------------+-----+----------+----------+
| Continuing operations | | | |
+----------------------------------------+-----+----------+----------+
| Loss before taxation | | (11,647) | (32,393) |
+----------------------------------------+-----+----------+----------+
| Adjustments for: | | | |
+----------------------------------------+-----+----------+----------+
| Share of (profits)/losses of jointly | | (128) | 10 |
| controlled entities | | | |
+----------------------------------------+-----+----------+----------+
| Impairment of a jointly controlled | | 128 | - |
| entity | | | |
+----------------------------------------+-----+----------+----------+
| Share of losses/(profits) of | | 42 | (24) |
| associates | | | |
+----------------------------------------+-----+----------+----------+
| Impairment of associates | | 389 | - |
+----------------------------------------+-----+----------+----------+
| Interest income | | (54) | (402) |
+----------------------------------------+-----+----------+----------+
| Finance costs | | 112 | 201 |
+----------------------------------------+-----+----------+----------+
| Loss on financial assets at fair value | | 2,003 | 2,219 |
| through profit or loss | | | |
+----------------------------------------+-----+----------+----------+
| Employee share-based compensation | | 701 | 1,701 |
+----------------------------------------+-----+----------+----------+
| Depreciation of property, plant and | | 223 | 809 |
| equipment | | | |
+----------------------------------------+-----+----------+----------+
| Write off of property, plant and | | 16 | 83 |
| equipment | | | |
+----------------------------------------+-----+----------+----------+
| Profit on disposal of property, plant | | (18) | (9) |
| and equipment | | | |
+----------------------------------------+-----+----------+----------+
| Amortisation of intangible assets | | - | 314 |
+----------------------------------------+-----+----------+----------+
| Impairment of intangible assets | | - | 8,930 |
+----------------------------------------+-----+----------+----------+
| Write off of intangible assets | | - | 468 |
+----------------------------------------+-----+----------+----------+
| Loss on disposal of available-for-sale | | 362 | 155 |
| investments | | | |
+----------------------------------------+-----+----------+----------+
| Impairment of available-for-sale | | 1,536 | - |
| investments | | | |
+----------------------------------------+-----+----------+----------+
| Bad debts recovery | | (2) | (2) |
+----------------------------------------+-----+----------+----------+
| Impairment of trade and other | | 71 | 769 |
| receivables | | | |
+----------------------------------------+-----+----------+----------+
| Foreign exchange (gains)/losses, net | | (30) | 17 |
+----------------------------------------+-----+----------+----------+
| | | | |
+----------------------------------------+-----+----------+----------+
| Operating cash flow before working | | (6,296) | (17,154) |
| capital changes | | | |
+----------------------------------------+-----+----------+----------+
| | | | |
+----------------------------------------+-----+----------+----------+
| Acquisition of financial assets at | | (153) | (238) |
| fair value through profit or loss | | | |
+----------------------------------------+-----+----------+----------+
| Proceeds from disposal of financial | | | |
| assets at fair value through profit or | | 881 | 2,093 |
| loss | | | |
+----------------------------------------+-----+----------+----------+
| Decrease in trade and other | | 2,205 | 4,730 |
| receivables | | | |
+----------------------------------------+-----+----------+----------+
| Decrease in trade and other payables | | (5,033) | (2,828) |
+----------------------------------------+-----+----------+----------+
| Increase in provision for liabilities | | 1,990 | 4,219 |
+----------------------------------------+-----+----------+----------+
| Decrease in amounts due from parent | | | |
| company and related company | | 210 | 11,635 |
+----------------------------------------+-----+----------+----------+
| Increase in amounts due to parent | | 2 | - |
| company and related company | | | |
+----------------------------------------+-----+----------+----------+
| Decrease/(Increase) in amounts due | | 294 | (237) |
| from jointly controlled entities | | | |
+----------------------------------------+-----+----------+----------+
| Decrease in amounts due from | | 14 | 48 |
| associates | | | |
+----------------------------------------+-----+----------+----------+
| | | | |
+----------------------------------------+-----+----------+----------+
| Cash generated from operations | | (5,886) | 2,268 |
+----------------------------------------+-----+----------+----------+
| | | | |
+----------------------------------------+-----+----------+----------+
| Tax paid | | (2,318) | (46) |
+----------------------------------------+-----+----------+----------+
| Tax refund | | 124 | 3 |
+----------------------------------------+-----+----------+----------+
| Interest paid | | (109) | (132) |
+----------------------------------------+-----+----------+----------+
| | | | |
+----------------------------------------+-----+----------+----------+
| Net cash (outflow)/inflow from | | | |
| operating activities from continuing | | (8,189) | 2,093 |
| operations | | | |
+----------------------------------------+-----+----------+----------+
| | | | |
+----------------------------------------+-----+----------+----------+
| Discontinued operations | | | |
+----------------------------------------+-----+----------+----------+
| Net cash outflow used in operating | | - | (500) |
| activities from discontinued | | | |
| operations | | | |
+----------------------------------------+-----+----------+----------+
| | | | |
+----------------------------------------+-----+----------+----------+
| Net cash (outflow)/inflow from | | (8,189) | 1,593 |
| operating activities | | | |
+----------------------------------------+-----+----------+----------+
Consolidated Statement of Cash Flows (Continued)
For the year ended 31 December 2009
+----------------------------------------+-----+----------+----------+
| | | 2009 | 2008 |
+----------------------------------------+-----+----------+----------+
| | | US$'000 | US$'000 |
+----------------------------------------+-----+----------+----------+
| | | | |
+----------------------------------------+-----+----------+----------+
| Investing activities | | | |
+----------------------------------------+-----+----------+----------+
| | | | |
+----------------------------------------+-----+----------+----------+
| Continuing operations | | | |
+----------------------------------------+-----+----------+----------+
| Interest received | | 20 | 755 |
+----------------------------------------+-----+----------+----------+
| Purchases of property, plant and | | (309) | (5,146) |
| equipment | | | |
+----------------------------------------+-----+----------+----------+
| Investment in a jointly controlled | | - | (4) |
| entity | | | |
+----------------------------------------+-----+----------+----------+
| Acquisition of additional interests in | | (232) | (741) |
| subsidiaries | | | |
+----------------------------------------+-----+----------+----------+
| Acquisition of subsidiaries, net of | | - | 111 |
| cash acquired | | | |
+----------------------------------------+-----+----------+----------+
| Acquisition of the Forsyth Business | | - | (355) |
+----------------------------------------+-----+----------+----------+
| Proceeds from sale of property, plant | | 94 | 1,755 |
| and equipment | | | |
+----------------------------------------+-----+----------+----------+
| Proceeds from sale of | | 524 | 2,500 |
| available-for-sale investments | | | |
+----------------------------------------+-----+----------+----------+
| Loan to an associate | | (375) | - |
+----------------------------------------+-----+----------+----------+
| Disposals of subsidiaries, net of cash | | - | (35) |
| disposed of | | | |
+----------------------------------------+-----+----------+----------+
| Net advance to related companies | | - | (598) |
+----------------------------------------+-----+----------+----------+
| Net advance to staff | | (33) | (253) |
+----------------------------------------+-----+----------+----------+
| | | | |
+----------------------------------------+-----+----------+----------+
| Net cash outflow used in investing | | | |
| activities from continuing operations | | (311) | (2,011) |
+----------------------------------------+-----+----------+----------+
| | | | |
+----------------------------------------+-----+----------+----------+
| Discontinued operations | | | |
+----------------------------------------+-----+----------+----------+
| Net cash outflow used in investing | | | |
| activities from discontinued | | - | (7) |
| operations | | | |
+----------------------------------------+-----+----------+----------+
| | | | |
+----------------------------------------+-----+----------+----------+
| Net cash outflow used in investing | | (311) | (2,018) |
| activities | | | |
+----------------------------------------+-----+----------+----------+
| | | | |
+----------------------------------------+-----+----------+----------+
| Financing activities | | | |
+----------------------------------------+-----+----------+----------+
| | | | |
+----------------------------------------+-----+----------+----------+
| Continuing operations | | | |
+----------------------------------------+-----+----------+----------+
| Dividend paid to minority shareholders | | - | (5,658) |
+----------------------------------------+-----+----------+----------+
| Issue of shares | | - | 84 |
+----------------------------------------+-----+----------+----------+
| Drawdown of loan receivable | | - | 11,410 |
+----------------------------------------+-----+----------+----------+
| Inception of finance lease obligations | | - | 1,313 |
+----------------------------------------+-----+----------+----------+
| Repayment of loan receivable | | - | (11,410) |
+----------------------------------------+-----+----------+----------+
| Repayment of finance lease obligations | | (319) | (569) |
+----------------------------------------+-----+----------+----------+
| | | | |
+----------------------------------------+-----+----------+----------+
| Net cash outflow used in financing | | | |
| activities from continuing operations | | (319) | (4,830) |
+----------------------------------------+-----+----------+----------+
| | | | |
+----------------------------------------+-----+----------+----------+
| Discontinued operations | | | |
+----------------------------------------+-----+----------+----------+
| Net cash outflow used in financing | | | |
| activities from discontinued | | - | - |
| operations | | | |
+----------------------------------------+-----+----------+----------+
| | | | |
+----------------------------------------+-----+----------+----------+
| Net cash outflow used in financing | | (319) | (4,830) |
| activities | | | |
+----------------------------------------+-----+----------+----------+
| | | | |
+----------------------------------------+-----+----------+----------+
| Net decrease in cash and cash | | (8,819) | (5,255) |
| equivalents | | | |
+----------------------------------------+-----+----------+----------+
| Cash and cash equivalents as at 1 | | 15,526 | 20,766 |
| January | | | |
+----------------------------------------+-----+----------+----------+
| Effect of exchange rate fluctuations | | 16 | 15 |
+----------------------------------------+-----+----------+----------+
| | | | |
+----------------------------------------+-----+----------+----------+
| Cash and cash equivalents as at 31 | | 6,723 | 15,526 |
| December | | | |
+----------------------------------------+-----+----------+----------+
| | | | |
+----------------------------------------+-----+----------+----------+
| Analysed into: | | | |
+----------------------------------------+-----+----------+----------+
| - Continuing operations | | 6,723 | 15,526 |
+----------------------------------------+-----+----------+----------+
| - Discontinued operations | | - | - |
+----------------------------------------+-----+----------+----------+
| | | | |
+----------------------------------------+-----+----------+----------+
| Total | | 6,723 | 15,526 |
+----------------------------------------+-----+----------+----------+
Notes to the Consolidated Financial Information
1. Basis of preparation
The Company was incorporated in the Cayman Islands, which does not prescribe the
adoption of any particular accounting framework. The Board has therefore
adopted International Financial Reporting Standards ("IFRSs") issued by the
International Accounting Standards Board. The Company's shares are listed on
the AIM of London Stock Exchange.
The financial statements are prepared under historical cost convention except
for financial instruments classified as available-for-sale and at fair value
through profit or loss, which are measured at fair value. The measurement bases
are fully described in the accounting policies detailed in the Group's 2009
annual report and financial statements.
In preparing the financial statements, the Directors have considered the
operations of the Group as a going concern notwithstanding that the Group's
current liabilities exceed its current assets by approximately US$973,000 as at
31 December 2009 (2008: Net current assets of US$7,419,000), the Group incurred
a loss attributable to owners of the Company of approximately US$10,941,000
(2008: US$56,485,000) and the ability of Crosby Capital Limited ("Crosby"), its
parent company to provide funding to the Group is dependent on Crosby deferring
the payment of a US$20 million convertible bond, which is due for repayment in
March 2011. The Directors have prepared the financial statements based on the
assumption that the Group can continue as a going concern and are of the view
that the Group will have sufficient working capital to finance its operations
for twelve months from the date of signing these financial statements, after
taking into consideration the followings:
i. Crosby has been approached by certain convertible bond holders on a
possible restructuring of the convertible bond, which may include a change in
the terms of the convertible bond and an extension of the maturity date; and
ii. the Group continues to implement measures to tighten cost controls over
various administrative expenses and to attain positive cash flow operations with
the funding from Crosby.
The Directors of the Company believe that the aforementioned restructuring of
Crosby's convertible bond and cost control measures will be successful. Having
regard to the cash flow projection of the Group, which has been prepared
assuming that these measures are successful, the Directors of the Company are of
the opinion that, in the light of the measures taken to date, together with the
expected results of other measures in progress, the Group will have sufficient
cash resources to satisfy its future working capital requirement.
Should the Group be unable to generate sufficient cash flows and/or Crosby be
unable to secure the support of convertible bond holders, the Group might not be
able to continue in business as a going concern. Accordingly, adjustments would
have to be made in the financial statements to restate the values of the assets
to their recoverable amounts, to provide for any further liabilities which might
arise, and to reclassify non-current assets and non-current liabilities as
current assets and current liabilities respectively. The effect of these
adjustments has not been reflected in the financial statements.
It should be noted that accounting estimates and assumptions are used in
preparation of the financial statements. Although these estimates are based on
management's best knowledge and judgement of current events and actions, actual
results may ultimately differ from those estimates. The areas involving a
higher degree of judgement or complexity, or areas where assumptions and
estimates are significant to the financial statements, are set out in the
Group's 2009 annual report and financial statements.
The consolidated financial statements incorporate the financial statements of
the Company and its subsidiaries (together referred to as "the Group")made up to
31 December each year. Material intra-group balances and transactions, and any
unrealised gains arising from intra-group transactions, are eliminated on
consolidation. Unrealised losses are also eliminated unless the transaction
provides evidence of an impairment of the asset transferred.
The principal accounting policies are detailed in the Group's 2009 annual report
and financial statements.
2. Segmental Information
In identifying the Group's operating segments, the management generally follows
the Group's service lines which represent the main service lines provided by the
Group.
The Group has identified the following reportable operating segments:
i) Merchant Banking - provision of corporate finance and
other advisory services and the changes in fair value of financial assets and
liabilities through profit or loss arising from the Group's merchant banking
activities. This business was discontinued during the year ended 31 December
2008 and therefore has been shown as a discontinued operation.
ii) Asset Management - provision of fund management, asset
management and wealth management services.
iii) Direct Investment - the remaining investments held
which arose from the merchant banking segment and are now managed on a passive
basis.
The comparative figures are restated to include those items primarily related to
corporate offices costs directly allocated to the merchant banking or asset
management segment, instead of disclosing them under "unallocated" in the
consolidated financial statements for the year ended 31 December 2008.
The revenues generated, losses incurred from operations and total assets by each
of the Group's operating segments are summarised as follows:
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | Merchant | Direct | Asset | Total |
| | Banking | Investment | Management | |
+---------------+----------------------+----------------------+----------------------+----------------------+
| | |(Restated) | |(Restated) | |(Restated) | |(Restated) |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | 2009 | 2008 | 2009 | 2008 | 2009 | 2008 | 2009 | 2008 |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| |US$'000 | US$'000 |US$'000 | US$'000 |US$'000 | US$'000 |US$'000 | US$'000 |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| Continuing | | | | | | | | |
| operations | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| Revenue | | | | | | | | |
| from | | | | | | | | |
| external | - | - | - | 2,573 | 3,505 | 20,280 | 3,505 | 22,853 |
| customers | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| Inter-segment | | | | | | | | |
| revenues | - | - | 57 | 513 | 1,139 | 5,985 | 1,196 | 6,498 |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| Total | - | - | 57 | 3,086 | 4,644 | 26,265 | 4,701 | 29,351 |
| revenue | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| Segment | | | | | | | | |
| (loss)/profit | | | | | | | | |
| from | | | | | | | | |
| operations | - | - |(2,085) | 419 |(5,785) | (10,282) |(7,870) | (9,863) |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| Discontinued | | | | | | | | |
| operations | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| Revenue | - | 2,612 | - | - | - | - | - | 2,612 |
| from | | | | | | | | |
| external | | | | | | | | |
| customers | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| Inter-segment | - | - | - | - | - | | - | - |
| revenues | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| Total | - | 2,612 | - | - | - | - | - | 2,612 |
| revenue | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| Segment | | | | | | | | |
| loss | | | | | | | | |
| from | | | | | | | | |
| discontinued | - | (25,207) | - | - | - | - | - | (25,207) |
| operations | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| Continuing | | | | | | | |
| operations | | | | | | | |
+-------------------------+------------+---------+------------+---------+------------+---------+------------+
| | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| Segment | - | - | 645 | 4,904 | 8,567 | 19,836 | 9,212 | 24,740 |
| total | | | | | | | | |
| assets | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| Discontinued | | | | | | | |
| operations | | | | | | | |
+-------------------------+------------+---------+------------+---------+------------+---------+------------+
| | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| Segment | - | - | - | - | - | - | - | - |
| total | | | | | | | | |
| assets | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | | | | | | | | |
+---------------+---------+------------+---------+------------+---------+------------+---------+------------+
Segment loss from operations can be reconciled to consolidated loss from
operations as follows:
+----------+---------+-------+----------+---------+-------+-------+-------+----------+----------+
| | | | | | | | 2009 | 2008 |
+----------+---------+------------------+---------+-------+-------+-------+----------+----------+
| | | | | | | | US$'000 | US$'000 |
+----------+---------+------------------+---------+-------+-------+-------+----------+----------+
| | | | | | | | | |
+----------+---------+------------------+---------+-------+-------+-------+----------+----------+
| Continuing | | | | | | | |
| operations | | | | | | | |
+--------------------+------------------+---------+-------+-------+-------+----------+----------+
| | | | | | | | | |
+----------+---------+------------------+---------+-------+-------+-------+----------+----------+
| Segment loss from operations | | | | | (7,870) | (9,863) |
+---------------------------------------+---------+-------+-------+-------+----------+----------+
| | | | | | | | | |
+----------+---------+------------------+---------+-------+-------+-------+----------+----------+
| Reconciling items: | | | | | | | |
+--------------------+------------------+---------+-------+-------+-------+----------+----------+
| Other income not | | | | | | 19 | 126 |
| allocated | | | | | | | |
+--------------------+------------------+---------+-------+-------+-------+----------+----------+
| Restructuring | | | | | | (2,622) | (6,968) |
| expenses | | | | | | | |
+--------------------+------------------+---------+-------+-------+-------+----------+----------+
| Amortisation of intangible assets | | | | | - | (314) |
+---------------------------------------+---------+-------+-------+-------+----------+----------+
| Impairment of intangible assets | | | | | - | (8,930) |
+---------------------------------------+---------+-------+-------+-------+----------+----------+
| Write off of intangible assets | | | | | - | (468) |
+---------------------------------------+---------+-------+-------+-------+----------+----------+
| Other expenses not allocated | | | | | (1,160) | (7,086) |
+---------------------------------------+---------+-------+-------+-------+----------+----------+
| Elimination of inter-segment revenue/ expenses | | | | 12 | 1,297 |
+-------------------------------------------------+-------+-------+-------+----------+----------+
| | | | | | | | |
+----------------------------+----------+---------+-------+-------+-------+----------+----------+
| Loss from operations | | | | | |(11,621) |(32,206) |
+----------------------------+----------+---------+-------+-------+-------+----------+----------+
| | | | | | | | |
+----------------------------+----------+---------+-------+-------+-------+----------+----------+
| Finance costs | | | | | | (112) | (201) |
+----------------------------+----------+---------+-------+-------+-------+----------+----------+
| Share of (losses)/profits | | | | | | (42) | 24 |
| of associates | | | | | | | |
+----------------------------+----------+---------+-------+-------+-------+----------+----------+
| Share of profits/(losses) of jointly controlled | | | | 128 | (10) |
| entities | | | | | |
+-------------------------------------------------+-------+-------+-------+----------+----------+
| | | | | | | | |
+--------------------+------------------+---------+-------+-------+-------+----------+----------+
| Loss before | | | | | |(11,647) |(32,393) |
| taxation | | | | | | | |
+--------------------+------------------+---------+-------+-------+-------+----------+----------+
| | | | | | | | | | |
+----------+---------+-------+----------+---------+-------+-------+-------+----------+----------+
Segment total assets can be reconciled to consolidated total assets as follows:
+-----------------+------+------+------+------+-----+---------+---------+
| | | | | | | 2009 | 2008 |
+-----------------+------+------+------+------+-----+---------+---------+
| | | | | | |US$'000 |US$'000 |
+-----------------+------+------+------+------+-----+---------+---------+
| | | | | | | | |
+-----------------+------+------+------+------+-----+---------+---------+
| Continuing | | | | | | | |
| operations | | | | | | | |
+-----------------+------+------+------+------+-----+---------+---------+
| | | | | | | | |
+-----------------+------+------+------+------+-----+---------+---------+
| Segment total | | | | | | 9,212 | 24,740 |
| assets | | | | | | | |
+-----------------+------+------+------+------+-----+---------+---------+
| Other assets | | | | | | 34 | 180 |
| not allocated | | | | | | | |
+-----------------+------+------+------+------+-----+---------+---------+
| | | | | | | | |
+-----------------+------+------+------+------+-----+---------+---------+
| Total assets | | | | | | 9,246 | 24,920 |
+-----------------+------+------+------+------+-----+---------+---------+
| | | | | | | | |
+-----------------+------+------+------+------+-----+---------+---------+
| | | | | | | | |
+-----------------+------+------+------+------+-----+---------+---------+
+-------------+---------+------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | Merchant | Direct | Asset | Other | Total |
| | banking | investment | Management | | |
+-------------+----------------------+----------------------+----------------------+----------------------+----------------------+
| | | (Restated) | | (Restated) | | (Restated) | | (Restated) | | (Restated) |
+-------------+---------+------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | 2009 | 2008 | 2009 | 2008 | 2009 | 2008 | 2009 | 2008 | 2009 | 2008 |
+-------------+---------+------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | US$'000 | US$'000 | US$'000 | US$'000 | US$'000 | US$'000 | US$'000 | US$'000 | US$'000 | US$'000 |
+-------------+---------+------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | | | | | | | | | | |
+-------------+---------+------------+---------+------------+---------+------------+---------+------------+---------+------------+
| Other | | | | | | | | | | |
| information | | | | | | | | | | |
+-------------+---------+------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | | | | | | | | | | |
+-------------+---------+------------+---------+------------+---------+------------+---------+------------+---------+------------+
| | | | | | | | | | | |
+-------------+---------+------------+---------+------------+---------+------------+---------+------------+---------+------------+
+--------------------+----+-------+------+------+-------+-------+-----+-------+-------+-------+
| Continuing | | | | | | | | | | |
| operations | | | | | | | | | | |
+--------------------+----+-------+------+------+-------+-------+-----+-------+-------+-------+
| | | | | | | | | | | |
+--------------------+----+-------+------+------+-------+-------+-----+-------+-------+-------+
| Interest | - | - | (23) | (24) | (31) | (378) | - | - | (54) | (402) |
| income | | | | | | | | | | |
+--------------------+----+-------+------+------+-------+-------+-----+-------+-------+-------+
| Depreciation | - | - | - | - | 223 | 809 | - | - | 223 | 809 |
+--------------------+----+-------+------+------+-------+-------+-----+-------+-------+-------+
| Amortisation | | | | | | | | | | |
| of | - | - | - | - | - | - | - | 314 | - | 314 |
| intangible | | | | | | | | | | |
| assets | | | | | | | | | | |
+--------------------+----+-------+------+------+-------+-------+-----+-------+-------+-------+
| Impairment | | | | | | | | | | |
| of | - | - | - | - | - | - | - | 8,930 | - | 8,930 |
| intangible | | | | | | | | | | |
| assets | | | | | | | | | | |
+--------------------+----+-------+------+------+-------+-------+-----+-------+-------+-------+
| Write | | | | | | | | | | |
| off of | - | - | - | - | - | - | - | 468 | - | 468 |
| intangible | | | | | | | | | | |
| assets | | | | | | | | | | |
+--------------------+----+-------+------+------+-------+-------+-----+-------+-------+-------+
| Impairment | | | | | | | | | | |
| of | - | - | - | - | 1,536 | - | - | - | 1,536 | - |
| available-for-sale | | | | | | | | | | |
| investments | | | | | | | | | | |
+--------------------+----+-------+------+------+-------+-------+-----+-------+-------+-------+
| Impairment | | | | | | | | | | |
| of | - | - | - | - | 389 | - | - | - | 389 | - |
| associates | | | | | | | | | | |
+--------------------+----+-------+------+------+-------+-------+-----+-------+-------+-------+
| Impairment | | | | | | | | | | |
| of a | - | - | - | - | 128 | - | - | - | 128 | - |
| jointly | | | | | | | | | | |
| controlled | | | | | | | | | | |
| entity | | | | | | | | | | |
+--------------------+----+-------+------+------+-------+-------+-----+-------+-------+-------+
| Impairment | | | | | | | | | | |
| of other | - | - | - | - | 71 | 769 | - | - | 71 | 769 |
| receivable | | | | | | | | | | |
+--------------------+----+-------+------+------+-------+-------+-----+-------+-------+-------+
| Share-based | | | | | | | | | | |
| compensation | - | - | 4 | 149 | 421 | 1,035 | 276 | 517 | 701 | 1,701 |
+--------------------+----+-------+------+------+-------+-------+-----+-------+-------+-------+
| | | | | | | | | | | |
+--------------------+----+-------+------+------+-------+-------+-----+-------+-------+-------+
| Discontinued | | | | | | | | | | |
| operations | | | | | | | | | | |
+--------------------+----+-------+------+------+-------+-------+-----+-------+-------+-------+
| | | | | | | | | | | |
+--------------------+----+-------+------+------+-------+-------+-----+-------+-------+-------+
| Interest | - | (375) | - | - | - | - | - | - | - | (375) |
| income | | | | | | | | | | |
+--------------------+----+-------+------+------+-------+-------+-----+-------+-------+-------+
| Depreciation | - | 7 | - | - | - | - | - | - | - | 7 |
+--------------------+----+-------+------+------+-------+-------+-----+-------+-------+-------+
| Share-based | | | | | | | | | | |
| compensation | - | 92 | - | - | - | - | - | - | - | 92 |
+--------------------+----+-------+------+------+-------+-------+-----+-------+-------+-------+
| | | | | | | | | | | |
+--------------------+----+-------+------+------+-------+-------+-----+-------+-------+-------+
3. Restructuring expenses - continuing operations
+--------------------------------+-----------+------------+
| | 2009 | 2008 |
+--------------------------------+-----------+------------+
| | US$'000 | US$'000 |
+--------------------------------+-----------+------------+
| | | |
+--------------------------------+-----------+------------+
| Write off of property, plant | - | 3,153 |
| and equipment | | |
+--------------------------------+-----------+------------+
| Provision for onerous contract | | |
| in respect of operating lease | 2,685 | 973 |
+--------------------------------+-----------+------------+
| Others | (63) | 2,842 |
+--------------------------------+-----------+------------+
| | | |
+--------------------------------+-----------+------------+
| Total | 2,622 | 6,968 |
+--------------------------------+-----------+------------+
During the year ended 31 December 2009, the Group has increased, by US$2,685,000
(2008: US$973,000), the provision for the discounted net present value of the
future property operating lease rental payments under the operating lease, on
the basis that no sublet of the property is achieved for the remaining term of
the lease.
4. Taxation - continuing operations
+---------------------------+------------+-------------+
| | 2009 | 2008 |
+---------------------------+------------+-------------+
| | US$'000 | US$'000 |
+---------------------------+------------+-------------+
| | | |
+---------------------------+------------+-------------+
| Current tax credit / | | |
| (charge) | | |
+---------------------------+------------+-------------+
| - United Kingdom | 32 | (35) |
+---------------------------+------------+-------------+
| - Overseas | 27 | 162 |
+---------------------------+------------+-------------+
| | | |
+---------------------------+------------+-------------+
| Total | 59 | 127 |
+---------------------------+------------+-------------+
United Kingdom and overseas income tax for the year have been calculated at the
rates prevailing in the relevant jurisdictions.
A reconciliation of the tax credit applicable to the lossbefore taxation using
the statutory rates for the countries in which the Company and its subsidiaries
are domiciled to the tax credit at the effective tax rates, and a reconciliation
of the statutory tax rates to the effective tax rates, are as follows :
+---------------------+----------+----------+----------+---------+
| | 2009 | 2008 |
+---------------------+---------------------+--------------------+
| | US$'000 | % | US$'000 | % |
+---------------------+----------+----------+----------+---------+
| | | | | |
+---------------------+----------+----------+----------+---------+
| Loss before | | | | |
| taxation | | | | |
+---------------------+----------+----------+----------+---------+
| Continuing | (11,647) | | (32,393) | |
| operations | | | | |
+---------------------+----------+----------+----------+---------+
| Discontinued | - | | (25,207) | |
| operations | | | | |
+---------------------+----------+----------+----------+---------+
| | | | | |
+---------------------+----------+----------+----------+---------+
| | (11,647) | | (57,600) | |
+---------------------+----------+----------+----------+---------+
| | | | | |
+---------------------+----------+----------+----------+---------+
| Less: Adjustments | | | | |
+---------------------+----------+----------+----------+---------+
| Share of | | | | |
| (profits)/losses of | (128) | | 10 | |
| jointly controlled | | | | |
| entities | | | | |
+---------------------+----------+----------+----------+---------+
| Share of | | | | |
| losses/(profits) | 42 | | (24) | |
| of associates | | | | |
+---------------------+----------+----------+----------+---------+
| | | | | |
+---------------------+----------+----------+----------+---------+
| | | | | |
+---------------------+----------+----------+----------+---------+
| | (11,733) | | (57,614) | |
+---------------------+----------+----------+----------+---------+
| | | | | |
+---------------------+----------+----------+----------+---------+
| Tax at the | (1,936) | 16.50 | (9,506) | 16.50 |
| domestic income | | | | |
| tax rates | | | | |
+---------------------+----------+----------+----------+---------+
| Tax effect of | | | | |
| prior year's tax | (136) | 1.16 | (202) | 0.35 |
| losses utilised | | | | |
| this year | | | | |
+---------------------+----------+----------+----------+---------+
| Income not subject | (1,213) | 10.34 | (1,137) | 1.97 |
| to tax | | | | |
+---------------------+----------+----------+----------+---------+
| Expenses not | | | | |
| deductible for tax | 2,457 | (20.94) | 6,182 | (10.73) |
+---------------------+----------+----------+----------+---------+
| Tax effect of | | | | |
| unrecognised | (108) | 0.92 | 1,237 | (2.15) |
| temporary | | | | |
| differences | | | | |
+---------------------+----------+----------+----------+---------+
| Tax effect of | | | | |
| unrecognised tax | 936 | (7.98) | 3,426 | (5.94) |
| losses | | | | |
+---------------------+----------+----------+----------+---------+
| Over provision in | (59) | 0.51 | (127) | 0.22 |
| prior years | | | | |
+---------------------+----------+----------+----------+---------+
| | | | | |
+---------------------+----------+----------+----------+---------+
| Tax credit for the | (59) | 0.51 | (127) | 0.22 |
| year | | | | |
+---------------------+----------+----------+----------+---------+
| | | | | |
+---------------------+----------+----------+----------+---------+
No recognition of potential deferred tax assets of the Group has been made as
the recoverability of the potential assets is uncertain.
5. Discontinued operations
+----------------------------------------------+---------+----------+
| | 2009 | 2008 |
+----------------------------------------------+---------+----------+
| | US$'000 | US$'000 |
+----------------------------------------------+---------+----------+
| | | |
+----------------------------------------------+---------+----------+
| Revenue | - | 2,612 |
+----------------------------------------------+---------+----------+
| Cost of sales | - | (1,527) |
+----------------------------------------------+---------+----------+
| | | |
+----------------------------------------------+---------+----------+
| Gross profit | - | 1,085 |
+----------------------------------------------+---------+----------+
| Loss on financial assets at fair value | - | (20,613) |
| through profit or loss | | |
+----------------------------------------------+---------+----------+
| Other income | - | 384 |
+----------------------------------------------+---------+----------+
| Administrative expenses | - | (5,432) |
+----------------------------------------------+---------+----------+
| Other operating expenses | - | (631) |
+----------------------------------------------+---------+----------+
| | | |
+----------------------------------------------+---------+----------+
| | | |
+----------------------------------------------+---------+----------+
| Loss before and after taxation for the | - | (25,207) |
| period | | |
+----------------------------------------------+---------+----------+
During the year ended 31 December 2008, the Group undertook a restructuring to
create a more efficient corporate structure by separating its Asset Management
and Merchant Banking operations. The staff employed in the Group's Merchant
Banking subsidiaries transferred their employment on a continuous basis to a
subsidiary of the Group's parent company, Crosby Capital Limited, with effect
from 30 June 2008. The financial assets of the Group that were derived from its
Merchant Banking operations were transferred into a wholly owned subsidiary,
Crosby Special Situations Fund Limited ("CSSF") during the year ended 31
December 2008. CSSF has entered into a standard performance-linked advisory
agreement with Crosby Capital Limited to manage the optimal realisation of these
investments but will not enter into any new merchant banking transactions
through the Group. The Group has retained a number of assets which form part of
the Merchant Banking operation, that are managed by CSSF with a view to
realisation. These assets are held by the Group on a passive basis and are
included within continuing operations from 1 July 2008. The majority of these
assets had either been realised or written off by 31 December 2009.
6. Loss per Share
(a) Basic
Basic loss per share is calculated by dividing consolidated loss attributable to
owners of the Company by the weighted average number of ordinary shares in issue
during the year.
+------------------------------+----------+----------+
| | 2009 | 2008 |
+------------------------------+----------+----------+
| | US$'000 | US$'000 |
+------------------------------+----------+----------+
| | | |
+------------------------------+----------+----------+
| Loss attributable to owners | | |
| of the Company | | |
+------------------------------+----------+----------+
| - Continuing | (10,941) | (31,278) |
| operations | | |
+------------------------------+----------+----------+
| - Discontinued | - | (25,207) |
| operations | | |
+------------------------------+----------+----------+
| | | |
+------------------------------+----------+----------+
| | | |
+------------------------------+----------+----------+
| | (10,941) | (56,485) |
+------------------------------+----------+----------+
+------------------------------+-------------+-------------+
| | 2009 | 2008 |
+------------------------------+-------------+-------------+
| Weighted average number of | | |
| shares for calculating basic | 243,475,000 | 243,432,377 |
| loss per share | | |
+------------------------------+-------------+-------------+
| | | |
+------------------------------+-------------+-------------+
+------------------------------+----------+----------+
| | 2009 | 2008 |
+------------------------------+----------+----------+
| | US cents | US cents |
+------------------------------+----------+----------+
| | | |
+------------------------------+----------+----------+
| Basic loss per share | | |
+------------------------------+----------+----------+
| - Continuing | (4.49) | (12.85) |
| operations | | |
+------------------------------+----------+----------+
| - Discontinued | - | (10.35) |
| operations | | |
+------------------------------+----------+----------+
| | | |
+------------------------------+----------+----------+
| | | |
+------------------------------+----------+----------+
| | (4.49) | (23.20) |
+------------------------------+----------+----------+
(b) Diluted
The diluted loss per share for 2009 and 2008 is the same as the basic loss per
share as the outstanding share options were anti-dilutive.
7. Publication
The financial information set out in this preliminary announcement does not
constitute statutory accounts.
The consolidated statement of financial position at 31 December 2009 and the
consolidated income statement, consolidated statement of comprehensive income,
consolidated statement of changes in equity, consolidated statement of cash
flows and enclosed notes for the year then ended have been extracted from the
Group's 2009 statutory financial statements upon which the auditors opinion is
unqualified, although readers should note that an emphasis of matter was raised
by the auditors as follows;
Emphasis of matter - Going concern
In forming our opinion on the financial statements, which is not qualified, we
have considered the adequacy of the disclosure made in note 3(a) of the Group
financial statements concerning the Group's ability to continue as a going
concern.
As explained in note 3(a) of the Group financial statements the Group's current
liabilities exceeded its current assets by US$973,000 as at 31 December 2009 and
the Group incurred a loss attributable to owners of the Company of
US$10,941,000. Crosby Asset Management Inc is dependent on its parent, Crosby
Capital Limited ("Crosby") for financial support. The ability of Crosby to
provide funding to the Group is dependent on Crosby deferring the payment of a
US$20 million convertible bond, due for repayment in March 2011. Crosby has
been approached by certain convertible bond holders.
These matters, explained in note 3(a) of the Group financial statements,
indicate the existence of a material uncertainty which may cast significant
doubt about the Group's ability to continue as a going concern. The financial
statements do not include the adjustments that would result if the Group was
unable to continue as a going concern.
8. Copies of This Announcement
Copies of this announcement are available for collection from the Company's
offices at 4 Old Park Lane, London W1K 1QW.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR SEMFSIFSSEDD
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