|
Command Technology Group Plc LSE: CDTP |
Dec 01, 2008 02:00 ET
Final Results
28/11/2008
GB0007235459/GBP/PLUS-exn
COMMAND TECHNOLOGY GROUP PLC
AUDITED FINAL RESULTS
FOR THE ELEVEN MONTHS ENDED 30 JUNE 2008
Company Number: 02721643
CHAIRMAN'S STATEMENT
FOR THE ELEVEN MONTHS ENDED 30 JUNE 2008
Overview
During the eleven months under review the Company has been through significant changes with a renewed focus on sales as
well as significant progress on the development of new products. Turnover for the period was £133,537, on which there
was a pre-tax loss of £130,059. Although these results are poorer than last year's, as my predecessor's statement
warned, this was anticipated as a result of the business reorganisation.
Additionally, while the acquisition of Command Television is a net expense in the short term I do feel that the Company
is now turning the corner in sales as a result. This acquisition has enabled us to broaden and modernise our portfolio,
and more importantly has given the Company the sales resource which it has long lacked.
Figures for the first quarter of this financial period show an improvement in sales and show a small loss whilst
supporting the higher cost base the Company now has.
Your board expect sales to continue to grow throughout the coming year.
Research and development
The Company has invested significant time and effort in new products and we expect to be in a position to announce these
to the market in due course. These new products provide us with the basis for winning significant new business.
New contracts and recurring revenues
Since the period end we have reported new contract wins with Betfair, Netplay, and British Gas (for their 'Help the
Aged' campaign). We are confident that our activities in the sales area will result in further contract wins over the
coming year.
During the period the Company has gained a number of new contracts in the on-line and interactive gaming areas, giving
it a good base of contracted and recurring revenues to build from. Against this however, the ongoing contraction of the
fixed line telephony market has resulted in the loss of a number of service contracts in this area. It remains the
Company's intention to increase recurring revenues from service contracts and licence fees in all areas.
Investments
Following the acquisition of Command Television, our main remaining investment is in Confabulate Ltd. The board
currently considers it unlikely that Confabulate will become profitable at any time in the near future, and thus the
value of this investment should be seen as negligible.
Board Changes
On 14 March 2008 Jennifer Allsop was appointed to the board of Directors and to the role of CEO, whilst on 27 February
2008 Chris Aitken stepped down from his role of non-executive Director.
On 9 May 2008 Neil Newell stepped down as Chairman and was replaced by Scott Fletcher who assumed the role of non-
executive Chairman. Neil Newell remains an executive director with the Company.
On 9 July 2008 Mick Gossage joined the Company (following the acquisition of Command TV, his previous employer).
Formerly a non-executive director of the Company, he became executive director responsible for sales.
Outlook
With the Company now clearly focused on the interactive TV and gaming and gambling industry we are confident that
providing the Company is adequately financed, it is ideally placed to take advantage of this growing market. The CallTV
market alone is forecast to triple (from £500m to £1.5bn) and with our proven strengths in both Interactive Television
and Telephony we anticipate that sales in this area will restore the Company to profitability.
Scott Fletcher
28 November 2008
The directors of the issuer accept responsibility for the contents of this announcement.
REPORT OF THE DIRECTORS
FOR THE ELEVEN MONTHS ENDED 30 JUNE 2008
The directors submit their report and the audited Financial Statements for the eleven months ended 30 June 2008.
Principal activities
The principal activities of the Company during the period were the development of high quality software applications for
the telecommunications, internet and broadcasting industries.
Review of the business and results
A full review of the business during the year is given in the Chairman's statement. The results and state of affairs of
the Company follow.
Dividends
The directors do not recommend payment of a dividend this year.
Future Developments
The outlook for the Company is detailed in the chairman's statement.
Directors and their interests
The directors, who served the Company during the period, together with their interests (including family interests) in
the 2.5p Ordinary shares of the Company at the beginning and end of the period, and presently, were as follows:
28 November 2008 30 June 2008 1 August 2007
S. Fletcher (appointed 9 May 2008) 623,700 388,500 388,500
J. Allsop (appointed 14 March 2008) - - -
N.K.F. Newell 3,148,295 3,148,295 3,148,295
M.J. Gossage 822,922 48,122 48,122
C.K. Harrison - - -
C. J.H. Aitken (resigned 27 February 2008) - - 183,100
Following the acquisition of Command Television Ltd on 7 July 2008 the shareholding of the former director, C.J.H.
Aitken, increased to 408,300. However, M.J. Gossage has power of attorney over this shareholding, and the share
options referred to below.
Options to acquire shares in the Company held by the directors were as follows:
Unexercised
1 August 2007 Granted Granted 30 June 2008 Exercise Expiry
Number Number Date Number Price Date
S. Fletcher - 360,416 9 June 2008 360,416 10.00p 9 June 2017
J. Allsop - 237,500 10 April 2008 237,500 12.00p 10 April 2012
N.K.F. Newell 60,000 - 21 June 2006 60,000 16.25p 21 June 2016
M.J. Gossage 60,000 - 21 June 2006 60,000 16.25p 21 June 2016
C.K. Harrison 60,000 - 21 June 2006 60,000 16.25p. 21 June 2016
C. J.H. Aitken 60,000 - 21 June 2006 60,000 16.25p 27 February 2009
All the options are in unapproved schemes, apart from those for J. Allsop relating to an Enterprise Management
Incentives scheme, and are broadly exercisable at the discretion of the board of directors. The number of options
granted to Scott Fletcher which can be subsequently exercised will be determined by the number of shares in issue
after such exercise; those referred to above are based on the number of Ordinary shares currently issued;
furthermore, the share option contract is between the Company and Lowry Investment Capital Ltd, a company
effectively controlled by Scott Fletcher.
Research and development
Our plans are to continue to develop and enhance our current products, and to broaden our range with solutions and
services for the social networking and interactive broadcast areas.
Policy on payments to creditors
It is the Company's policy to agree the terms of payment at the start of business with suppliers, to ensure that
suppliers are aware of the terms of payment and to pay in accordance with contractual and other legal obligations. At 30
June 2008 Trade Creditors amounted to 12 (31 July 2007 - 161) days' supplies.
Post balance sheet event
On 7 July 2008 the Company acquired the remaining issued shares, a 78.24% holding (3,596 in number), of Command
Television Ltd (CTV), becoming a 100% subsidiary at that date. The purchase consideration was facilitated by the issue
of four hundred 2.5 pence Company shares for each 2.5 pence share in CTV, when the mid market price of each Company
share was 13 pence, equivalent to total consideration of £186,992.
Auditors
A resolution in accordance with the provisions of the Companies Act to reappoint Grant Sellers as auditors will be
proposed at the Annual General Meeting.
By Order of the Board:
J.Allsop
Chief Executive Officer 28 November 2008
STATEMENT OF DIRECTORS' RESPONSIBILITIES
FOR THE ELEVEN MONTHS ENDED 30 JUNE 2008
The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable
law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors
have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Practice (United
Kingdom Accounting Standards and applicable law). The financial statements are required by law to give a true and fair
view of the state of affairs of the Company and of the profit or loss of the Company for that period.
In preparing these financial statements, the directors are required to: select suitable accounting policies and then
apply them consistently; make judgements and estimates that are reasonable and prudent; state whether applicable UK
Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial
statements; and prepare the financial statements on a going concern basis unless it is inappropriate to assume that the
Company will continue in business.
The directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time
the financial position of the Company and enable them to ensure that the financial statements comply with the Companies
Act 1985. They are also responsible for safeguarding the assets of the Company and hence taking reasonable steps for the
prevention and detection of fraud and other irregularities.
The directors are responsible for the maintenance and integrity of the corporate and financial information included on
the Company's website. Legislation in the United Kingdom governing the preparation and dissemination of financial
statements may differ from legislation in other jurisdictions.
The directors of the Company who held office at the date of approval of this annual report confirm that: so far as they
are aware, there is no relevant audit information, information needed by the Company's auditors in connection with
preparing their report, of which the Company's auditors are unaware; and they have taken all the steps that they ought
to have taken as directors in order to make themselves aware of any relevant audit information and to establish that the
Company's auditors are aware of that information.
N.K.F. Newell
Director
28 November 2008
INDEPENDENT AUDITORS' REPORT
TO THE SHAREHOLDERS OF COMMAND TECHNOLOGY GROUP PLC
We have audited the financial statements of Command Technology Group plc for the eleven months ended 30 June 2008. These
financial statements have been prepared under the accounting policies set out therein.
This report is made solely to the Company's members, as a body, in accordance with Section 235 of the Companies Act
1985. Our audit work has been undertaken so that we might state to the Company's members those matters we are required
to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not
accept or assume responsibility to anyone other than the Company and the Company's members as a body, for our audit
work, or the opinions we have formed.
Respective responsibilities of directors and auditors
The directors' responsibilities for preparing the financial statements in accordance with applicable law and United
Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice) are set out in the Statement of
Directors' Responsibilities.
Our responsibility is to audit the financial statements in accordance with relevant legal and regulatory requirements
and International Standards on Auditing (UK and Ireland).
We report to you our opinion as to whether the financial statements give a true and fair view and are properly prepared
in accordance with the Companies Act 1985. We also report to you whether in our opinion the information given in the
Directors' Report is consistent with the financial statements.
In addition we report to you if, in our opinion, the Company has not kept proper accounting records, if we have not
received all the information and explanations we require for our audit, or if information specified by law regarding
directors' remuneration and transactions with the Company is not disclosed.
We read the Directors' Report and consider the implications for our report if we become aware of any apparent
misstatements within it.
Basis of opinion
We conducted our audit in accordance with International Standards on Auditing (UK and Ireland) issued by the Auditing
Practices Board. An audit includes examination, on a test basis, of evidence relevant to the amounts and disclosures in
the financial statements. It also includes an assessment of the significant estimates and judgements made by the
directors in the preparation of the financial statements, and of whether the accounting policies are appropriate to the
Company's circumstances, consistently applied and adequately disclosed.
We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in
order to provide us with sufficient evidence to give reasonable assurance that the financial statements are free from
material misstatement, whether caused by fraud or other irregularity or error. In forming our opinion we also evaluated
the overall adequacy of the presentation of information in the financial statements.
Opinion
In our opinion: the financial statements give a true and fair view, in accordance with United Kingdom Generally Accepted
Accounting Practice, of the state of the Company's affairs as at 30 June 2008 and of its loss for the period then ended;
the financial statements have been properly prepared in accordance with the Companies Act 1985; and the information
given in the Directors' Report is consistent with the financial statements.
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 1a to the financial statements concerning the Company's ability to continue as a going concern.
The Company incurred a net loss of £102,106 during the period ended 30 June 2008 and the cash flow forecast indicates
that a bank overdraft facility is required. These conditions, along with the other matter explained in the same note to
the financial statements concerning projected sales, indicate the existence of material uncertainty which may cast doubt
about the Company's ability to continue as a going concern. The financial statements do not include the adjustments that
would result if the Company was unable to continue as a going concern.
Grant Sellers
Chartered Accountants
Registered Auditors 28 November 2008
PROFIT AND LOSS ACCOUNT
FOR THE ELEVEN MONTHS ENDED 30 JUNE 2008
Year ended
2008 31 July 2007
Notes £ £
Turnover 133,537 289,443
Cost of sales (141,027) (148,662)
------- -------
Gross (loss)/profit (7,490) 140,781
Distribution and selling costs (60,622) (44,214)
Administration expenses (66,143) (53,756)
------- -------
Operating (loss)/profit (134,255) 42,811
Interest receivable 4,196 3,146
------- -------
(Loss)/profit on ordinary
activities before taxation (130,059) 45,957
Taxation 27,953 (8,907)
------- -------
(Loss)/retained profit for the period/year (102,106) 37,050
------- -------
------- -------
(Loss)/profit per share (1.49)p 0.54p
------- -------
------- -------
There were no recognised gains or losses other than those recorded in the profit and loss account.
BALANCE SHEET
AS AT 30 JUNE 2008
2008 31 July 2007
£ £ £ £
Fixed assets
Intangible assets - -
Tangible assets 1,222 1,621
Investments 526 526
------- ------
1,748 2,147
Current assets
Stocks - 15,271
Debtors 101,807 77,661
Cash at bank and in hand 44,708 186,035
------- -------
146,515 278,967
------- -------
Creditors: Amounts falling
due within one year (29,472) (60,217)
------- -------
Net current assets 117,043 218,750
------- -------
Net assets 118,791 220,897
------- -------
------- -------
Capital and reserves
Called up share capital 171,198 171,198
Reserves (52,407) 49,699
------- -------
Shareholders' funds 118,791 220,897
------- -------
------- -------
For more information, please contact
Command Technology Group Plc