RNS Number : 8477T
Leo Insurance Services PLC
15 June 2009
15 June 2009
Leo Insurance Services plc ("LEO" or the "Company")
Chairman's Statement
In the year ended 31 January 2009 the Group made a consolidated loss of £33,046 (2008: £30,799)
Leo's only investment is a 50% share in Grafton Insurance Services Limited a brokerage specialising in property insurance. Whilst there has been a small amount of organic growth the main asset continues to be its long term contract with Safeland Plc.
The board continues to assess opportunities for acquisition which will benefit shareholders.
LG Lipman
Chairman
12 June 2009
CONSOLIDATED INCOME STATEMENT for the year ended 31 January 2009
| | Notes | Unaudited 2009 £ | | Audited 2008 £ |
| Revenue | | - | | - |
| | | | | |
| Cost of sales | | - | | - |
| | | | | |
| GROSS PROFIT | | - | | - |
| | | | | |
| Administrative Expenses | | (85,837) | | (100,496) |
| | | | | |
| OPERATING LOSS | | (85,837) | | (100,496) |
| | | | | |
| Share of results of joint venture - post tax | 6 | 58,135 | | 73,021 |
| | | | | |
| LOSS BEFORE INTEREST | | (27,702) | | (27,475) |
| | | | | |
| Finance income | | 506 | | 709 |
| Finance costs | | (5,850) | | (4,033) |
| LOSS BEFORE TAX | | (33,046) | | (30,799) |
| Tax | | - | | - |
| LOSS FOR THE FINANCIAL YEAR | | (33,046) | | (30,799) |
| | | | | |
| LOSS PER ORDINARY SHARE: | 3 | | | |
| Basic and diluted | | (0.46p) | | (0.43p) |
| | | | | |
The operating loss for the year arises from the group's continuing operations.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY for the year ended 31 January 2009
| | | Share capital £ | | Share premium £ | | Retained losses £ | | Total equity £ |
| | | | | | | | | |
| At 31 January 2007 (Audited) | | 72,160 | | 5,761 | | (59,204) | | 18,717 |
| | | | | | | | | |
| Loss for the year | | - | | - | | (30,799) | | (30,799) |
| At 31 January 2008 (Audited) | | 72,160 | | 5,761 | | (90,003) | | (12,082) |
| | | | | | | | | |
| Loss for the year | | - | | - | | (33,046) | | (33,046) |
| | | | | | | | | |
| At 31 January 2009 (Unaudited) | | 72,160 | | 5,761 | | (123,049) | | (45,128) |
CONSOLIDATED BALANCE SHEET 31 January 2009
| | Notes | Unaudited 2009 £ | | Audited 2008 £ |
| NON CURRENT ASSETS | | | | |
| Interests in joint ventures | | 19,176 | | 16,041 |
| CURRENT ASSETS | | | | |
| Trade and other receivables | | 3,391 | | 3,759 |
| Cash and cash equivalents | | 55,428 | | 69,543 |
| TOTAL CURRENT ASSETS | | 58,819 | | 73,302 |
| | | | | |
| TOTAL ASSETS | | 77,995 | | 89,343 |
| | | | | |
| CURRENT LIABILITIES | | | | |
| Redeemable preference shares | | (65,000) | | (65,000) |
| Trade and other payables | | (58,123) | | (36,425) |
| | | | | |
| TOTAL CURRENT LIABILITIES | | (123,123) | | (101,425) |
| NET LIABILITIES | | (45,128) | | (12,082) |
| | | | | |
| EQUITY | | | | |
| Share capital | 4 | 72,160 | | 72,160 |
| Share premium account | | 5,761 | | 5,761 |
| Retained losses | | (123,049) | | (90,003) |
| | | | | |
| TOTAL EQUITY | | (45,128) | | (12,082) |
| | | | | |
CONSOLIDATED CASH FLOW STATEMENT for the year ended 31 January 2009
| | Notes | | Unaudited 2009 £ | | Audited 2008 £ |
| OPERATING ACTIVITIES | | | | | |
| Net cash outflow from operations | 5 | | (69,621) | | (72,142) |
| Net cash outflow from operating activities | | | (69,621) | | (72,142) |
| INVESTING ACTIVITIES | | | | | |
| Interest received | | | 506 | | 709 |
| Dividends received from joint venture undertaking | | | 55,000 | | 122,500 |
| Net cash inflow from investing activities | | | 55,506 | | 123,209 |
| | | | | | |
| FINANCING ACTIVITIES | | | | | |
| Proceeds on issue of shares | | | - | | - |
| Net cash inflow from financing activities | | | - | | - |
| | | | | | |
| NET (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS | | | (14,115) | | 51,067 |
| Cash and cash equivalents at beginning of year | | | 69,543 | | 18,476 |
| CASH AND CASH EQUIVALENTS AT END OF YEAR | | | 55,428 | | 69,543 |
NOTES TO THE PRELIMINARY ANNOUNCEMENT for the year ended 31 January 2009
| 1 | BASIS OF PREPARATION |
| | |
| | This preliminary statement is not the Company's statutory accounts for the year ended 31 January 2009 or the period ended 31 January 2008. The statutory accounts for the year ended 31 January 2009 will be finalised based on the financial information presented by the directors in this preliminary announcement and will be delivered to the Registrar of Companies following the Company's Annual General Meeting. The statutory accounts for the year ended 31 January 2008 have been delivered to the registrar of companies and received an Auditors' Report which was unqualified and did not contain statements under s237 (2) and (3) of the Companies Act 1985. This announcement is prepared applying the recognition and measurement principles of International Financial Reporting Standards as adopted by the European Union. The financial information contained within this preliminary announcement was approved by the board on 12 June 2009. Copies of this announcement are available from the Company's website www.leoinsurance.co.uk and its registered office at 94-96 Great North Road, London, N2 0NL. The Annual Report and Accounts will be sent to shareholders in due course. |
| | |
2 ACCOUNTING POLICIES
STANDARDS ISSUED BUT NOT YET EFFECTIVE
At the date of authorisation of these financial statements the following Standards and Interpretations which have not been applied in these financial statements were in issue but not yet effective:
| International Accounting Standards (IAS/IFRS) | Effective date - annual periods beginning on or after | |
| IFRS 1 | First-time adoption of International Financial Reporting Standards - Amendment relating to cost of an investment on first-time adoption | 1 July 2009 |
| IFRS 2 | Share Based Payment - Amendment relating to vesting conditions and cancellations | 1 January 2009 |
| IFRS 3 | Business Combinations - Comprehensive revision on applying the acquisition method | 1 July 2009 |
| IFRS 7 & IAS 39 | Financial instruments: Disclosures - reclassification of financial assets | 1 January 2009 |
| IFRS 8 | Operating Segments | 1 January 2009 |
| IFRIC 12 | Service Concession Arrangements | 1 January 2008 |
| IFRIC 13 | Customer Loyalty Programmes | 1 July 2008 |
| IFRIC 14 | IAS 19 - The limit on a Defined Benefit Asset Minimum Funding Requirements and their interaction | 1 January 2008 |
| IFRIC 15 | Agreements for the Construction of Real Estate | 1 January 2009 |
| IFRIC 16 | Hedges of a Net Investment in a Foreign Operation | 1 October 2008 |
| IFRIC 17 | Distributions of non cash assets to owner | 1 July 2009 |
| IAS 1 | Presentation of Financial Statements - Amendments relating to disclosure of puttable instruments and obligations arising on liquidation | 1 January 2009 |
| IAS 1 | Presentation of Financial Statements - Amendments resulting from May 2008 annual improvements to IFRS's and other amendments | 1 January 2009 |
| IAS 23 | Borrowing costs - Comprehensive revision to prohibit immediate expensing | 1 January 2009 |
| IAS 27 | Consolidated and Separate Financial Statements - Consequential amendments arising from amendments to IFRS 3 | 1 July 2009 |
| IAS 28 | Investments in Associates - Consequential amendments arising from amendments to IFRS 3 | 1 July 2009 |
| IAS 31 | Interests in Joint Ventures - Consequential amendments arising from amendments to IFRS 3 | 1 July 2009 |
| IAS 31 | Interests in Joint Ventures - Amendments resulting from May 2008 annual improvements to IFRS's | 1 January 2009 |
| IAS 32 | Financial Instruments: Presentation - Amendments relating to puttable instruments and obligations arising on liquidation | 1 January 2009 |
| IAS 36 | Impairment of Assets - Amendments resulting from May 2008 annual improvements to IFRS | 1 January 2009 |
| IAS 39 | Financial Instruments: Recognition and Measurement - Amendments resulting from May 2008 annual improvements to IFRS and other amendments | 1 January 2009 |
| IAS 39 | Financial Instruments: Recognition and Measurement - Amendments for eligible hedged items | 1 July 2009 |
The directors anticipate that the adoption of these Standards and Interpretations in future periods will have no material impact on the financial statements of the Group when the relevant standards and interpretations come into effect.
BASIS OF CONSOLIDATION
The consolidated financial statements incorporate the financial statements of Leo Insurance Services plc, its subsidiary undertaking, Equalgold Limited, and the Group's share of profits and losses and net assets of its joint venture, Grafton Insurance Services Limited, made up to 31 January each year.
JOINT VENTURES
A joint venture is a contractual arrangement whereby the Group and other parties undertake an economic activity that is subject to joint control.
Jointly controlled entities are accounted for using the equity method. Investments in joint ventures are carried in the balance sheet at the Group's share of the net assets of the joint venture and the Group's share of profits for each financial year are recognised in the consolidated income statement.
OPERATING LOSS
Operating loss is stated before share of results of joint ventures, interest and tax.
FINANCIAL INSTRUMENTS
Financial assets and financial liabilities are recognised on the Group's balance sheet when the Group has become a party to the contractual priorities of the instrument.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents comprise cash balances and deposits held at call with banks.
FINANCIAL LIABILITIES AND EQUITY
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the Group after deducting all of its liabilities.
EQUITY INSTRUMENTS
Equity instruments issued by the company are recorded at the proceeds received, net of direct issue costs.
TRADE PAYABLES
Trade payables are measured on initial recognition at fair value and are subsequently measured at amortised cost using the effective interest rate method.
DEFERRED TAXATION
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The Group's liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the balance sheet date.
Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary difference arises from goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity.
SHARE BASED PAYMENT
The Group has applied the requirements of IFRS 2 Share based payment to share options. The fair value of the share options are determined at the grant date and are expensed on a straight line basis over the vesting period, based on the group's estimate of shares that will eventually vest and adjusted for the effect of non-market based vesting conditions.
Fair value is measured by use of the Black Scholes model. The expected life used in the model has been adjusted, based on management's best estimate, for the effects on non-transferability, exercise restrictions and behavioural considerations.
SEGMENTAL REPORTING
A business segment is a group of assets and operations that provide a product or service and that is subject to risks and returns that are different from other business segments. A geographic segment is a group of assets and operations that provide a product or service within a particular economic environment and that is subject to risks and returns that are different from segments operating in different economic environments.
CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION AND UNCERTAINTY
There are no critical accounting judgements or key sources of estimation and uncertainty.
| 3 | LOSS PER ORDINARY SHARE | Unaudited 2009 £ | | Audited 2008 £ |
| | The calculation of loss per ordinary share is based on the following losses and number of shares: | | | |
| | Loss for the year | (33,046) | | (30,799) |
| | | | | |
| | Weighted average number of shares for basic and diluted loss per share | 7,215,956 | | 7,215,956 |
| | | | | |
| | As there is a loss for the year, there is no dilutive effect from share options and therefore no difference between the basic and diluted loss per share. | |||
| 4 | SHARE CAPITAL | Unaudited 2009 £ | | Audited 2008 £ |
| | | | | |
| | Authorised: | | | |
| | 20,000,000 ordinary shares of 1p each 65,000 redeemable preference shares of £1 each | 200,000 65,000 | | 200,000 65,000 |
| | | 265,000 | | 265,000 |
| | Allotted, issued and fully paid: | | | |
| | 7,215,956 ordinary shares of 1p each | 72,160 | | 72,160 |
| | | | | |
Share issues:
There were no shares issued in the year, (2008: Nil).
| | Share options: On 3 February 2005 L Lipman, E Lipman and P Davis were each conditionally granted options over 911,458 ordinary shares. Each option is exercisable at the par value of 1p per share, at any time after 18 months and before 10 years following the date of grant. The company has granted options to subscribe for ordinary shares in the company equivalent to 1% of the issued share capital on completion of an acquisition which exceeds 75% in any class test within the AIM rules. These options are only exercisable during the period from date of acquisition to the period ending 18 months after that date at a price equivalent to the issue price in connection with the acquisition. |
| | As at 31 January 2009, the Company had 2,734,374 (2008: 2,734,374) outstanding unexpired options that are exercisable at 1p per ordinary share. No share options were granted, exercised or lapsed during the year (2008: Nil). |
| 5 | NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT | Unaudited 2009 £ | | Audited 2008 £ |
| | | | | |
| | Loss before tax | (33,046) | | (30,799) |
| | | | | |
| | Adjustments for: | | | |
| | Finance income | (506) | | (709) |
| | Finance costs | 5,850 | | 4,033 |
| | Share of results of joint venture - post tax | (58,135) | | (73,021) |
| | | | | |
| | Changes in working capital: | | | |
| | Decrease in trade and other receivables | 368 | | 8,319 |
| | Increase in trade and other payables | 15,848 | | 20,035 |
| | | | | |
| | Net cash outflow from operations | (69,621) | | (72,142) |
| | | | | |
| 6 | INTERESTS IN JOINT VENTURE | | | |
| | | | | |
| | The group holds a 50 per cent investment in Grafton Insurance Services Limited, a joint venture via the ownership of 100% of the "B" ordinary shares. The principal activity of the joint venture is that of a property insurance broker. The group's share of the joint venture's results and net assets are set out below. | |||
| | | | | |
| | | Unaudited 2009 £ | | Audited 2008 £ |
| | | | | |
| | Revenue | 161,464 | | 197,029 |
| | Operating profit | 72,554 | | 88,350 |
| | Finance Income | 874 | | 2,478 |
| | Profit before tax | 73,428 | | 90,828 |
| | Tax | (15,293) | | (17,807) |
| | Profit after tax | 58,135 | | 73,021 |
| | | | | |
| | | | | |
| | Interest in joint venture at 1 February 2008 | 16,041 | | 65,520 |
| | Share of profit for the year | 58,135 | | 73,021 |
| | Dividends | (55,000) | | (122,500) |
| | Interest in joint venture at 31 January 2009 | 19,176 | | 16,041 |
| | | | | |
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