TIDMAVR
RNS Number : 6896V
Avarae Global Coins PLC
17 December 2013
AVARAE GLOBAL COINS PLC
UNAUDITED INTERIM RESULTS FOR THE SIX MONTHS TO 30 SEPTEMBER
2013
London (AIM: AVR): 17 December 2013 - Avarae Global Coins plc
("Avarae" or the "Company"), the UK's only publicly traded
specialist company dedicated to investing in rare and high quality
coins, is pleased to announce its unaudited interim results for the
six months to 30 September 2013.
Highlights for the period include:
-- Sales for the six month period of GBP518,000 (2012: GBP440,000);
-- Loss on ordinary activities for the period of GBP142,000 (2012: loss GBP149,000);
-- Additions to the portfolio of GBP327,000 in the period (2012:
GBP713,000), including very high quality and
rare examples of English, Indian, Roman and Anglo-Gallic
coins;
-- Carrying value of coin inventory of GBP10,785,000 at the
period end (2012: GBP10,443,000); and
-- Net assets as at 30 September 2013 of GBP11,347,000 (2012: GBP11,131,000);
Commenting, Diane Clarke, Director of Avarae, said:
"We have been pleased with trading in the first half, being as
it was marginally up on that recorded in 2012. We believe that
Avarae remains well positioned as an alternative asset play as the
market for the highest quality rare coins should continue to
attract good demand and steady, predictable price growth. As we
appear to be emerging from the difficult economic times of the last
5 years we believe that investments in rare coins can continue to
outperform more traditional investments over a sustained period, as
has been proven by Avarae."
For further information on Avarae Global Coins plc, please
contact:
Diane Clarke/Matt Wood +44 (0)16 2461 5614
Avarae Global Coins plc
Tom Griffiths/Paul Gillam +44 (0)20 7601 6100
Westhouse Securities Ltd
Toby Hall +44 (0)20 7822 7493
GTH Communications Limited (Financial PR) +44 (0)7713 341072
DIRECTORS' REPORT
Introduction
We are pleased to present the unaudited interim results of
Avarae Global Coins plc ("Avarae" or the "Company") for the six
months ended 30 September 2013. During the period under review the
Company made significant investments in, and some selective
divestments from, its portfolio of rare and high quality coins. In
line with the Company's stated strategy, no revaluation of the coin
portfolio has been undertaken for the Company's interim
results.
Avarae provides access for institutions and individuals wanting
to diversify their investment portfolios away from the traditional
asset classes such as equities, property or bonds without the need
to be an expert in the coin-collecting sector. The Board's strategy
is to invest actively in the rarest and highest quality segment of
the coin-collecting sector in various countries around the world.
We have built up and are continually adding to an impressive
portfolio of extremely high quality, rare coins which we intend to
hold predominantly for the long-term (i.e. 3 to 5 years), with the
aim of achieving long-term capital growth for our shareholders,
while also taking advantage of short-term trading opportunities, as
the market for rare coins continues to grow.
The coin-dealing sector
Activity in the rare coin market has remained positive over the
period, although as mentioned in our full year results released in
July, one needs to possess the necessary expertise in identifying
which sectors are most appropriate for investment. English, Roman
and Indian coins continue to show robust healthy growth, whereas
the Chinese sector remains broadly flat. The numismatic industry
continues to witness an influx of new buyers looking for tangible
assets and fresh areas to place their money as traditional asset
classes fail to deliver robust financial gains and exhibit high
volatility. The majority of the funds coming into the numismatic
market are targeting the higher quality coin rarities and this is
adding considerable pressure on availability. A number of important
coins and coin collections have come up for sale worldwide with
auction houses continuing to achieve record prices, particularly
for the highest quality rare pieces.
Avarae's investments
In the six month period to 30 September 2013, the Company
acquired approximately GBP327,000 worth of coins (H1 2012:
GBP713,000) and sold coins for approximately GBP518,000 (H1 2012:
GBP440,000). Seeking out and acquiring the very highest quality
English, Indian, Roman and Anglo-Gallic coins dominated activities
during the period. Examples of rare coins acquired during the
period include:
-- Edward The Black Prince, Hardi d'Or; La Rochelle Mint,
half-length figure of Prince standing
facing, sword in his right hand, left hand pointing, fillet of
roses in hair. We believe to be a very
high quality and rare piece;
-- A very rare Edward III, Guyennois d'Or, La Rochelle; third
type, King walking right under portico,
two lions below, Mint letter R on top of right column; and
-- Edward VII (1901-10), Satin Finish Proof Sovereign, 1908 C,
Ottawa, Canada Mint, engraved by George William De Saulles, bare
head facing right. Extremely rare with an estimated mintage of only
636 pieces.
Financial Results
Sales of GBP518,000 with gross profit of GBP50,000 in the period
reflected a marginally higher level of auction consignments than in
the first half of 2012. The Company's second half of its financial
year has historically been its stronger half, partly as a result of
more coin auctions taking place in that period and also due to
higher margins being achieved over and above the prior year's
revaluation. The almost 10% gross margin achieved over and above
the March 2013 revaluation demonstrates, the directors believe, the
continued conservative carrying value of our coins.
Administrative expenses, which are always tightly controlled,
were lower during the period at GBP193,000 than in the same period
in 2012 (H1 2012: GBP207,000). The resulting net loss for the
period was GBP142,000 (H1 2012: loss of GBP148,000), equating to a
loss per share in line with last year of 0.18 pence (H1 2012: loss
per share of 0.18 pence).
Avarae declared a final dividend in July 2013 of 0.18p per share
(2012: 0.185p per share), resulting in a payment to shareholders in
September 2013 of approximately GBP145,000. The dividend policy
adopted by the Board is intended to be progressive and is expected
to be declared on an annual basis. As with last year, no dividend
has been declared in respect of the interim period. The level of
the dividend will reflect the Company's reported profits over a
three year period, thereby smoothing out any years of one-off
profits (or losses). The policy will be to pay out approximately
1/3 of the average net profits reported over the most recent three
year period.
In line with our stated strategy, the Company only undertakes
its portfolio revaluation exercise at the end of each financial
year (31 March), rather than mid-year and, only then, revaluing
coins that have been held by the Company for more than 12 months.
Accordingly, the GBP327,000 of coins acquired in the period under
review, together with the GBP1.2 million of coins acquired during
the year ended 31 March 2013, remain valued at cost. The total
value of the coin portfolio at the period end was GBP10.8 million
(31 March 2013: GBP10.9 million).
The Company ended the period under review with net cash of
GBP114,000 (31 March 2013: GBP368,000) and no borrowings (31 March
2013: GBPnil).
August and September 2013 were active trading months for us
where we made sales of almost GBP0.5 million and purchases of
almost GBP0.2 million. This is reflected in trade and other
receivables at the period end being significantly higher at
GBP942,000 (31 March 2013: GBP398,000), and similarly trade
creditors and accruals being pushed higher to GBP494,000 as at 30
September 2013 (31 March 2013: GBP58,000). All balances have been
settled post period end.
At the period end, the Company had net assets of GBP11.35
million (31 March 2013: GBP11.63 million), resulting in a net asset
value per Ordinary Share of 14.0 pence (31 March 2013: 14.4
pence).
Outlook
We've been pleased with trading in the first half, being as it
was marginally up on that recorded in 2012. We believe that Avarae
remains well positioned as an alternative asset play as the market
for the highest quality rare coins should continue to attract good
demand and steady, predictable price growth. As we appear to be
emerging from the difficult economic times of the last 5 years we
believe that investments in rare coins can continue to outperform
more traditional investments over a sustained period, as has been
proven by Avarae.
17 December 2013
Directors
AVARAE GLOBAL COINS PLC
UNAUDITED INCOME STATEMENT
from 1 April 2013 to 30 September 2013
1 April 1 April 1 April 12
13 12 to 31 Mar
to 30 Sept to 30 Sept 13
13 12
Unaudited Unaudited Audited
Note GBP'000 GBP'000 GBP'000
Revenue
Sales 518 440 1,102
Cost of Sales (468) (382) (995)
Coin revaluation - - 605
---- ---- ----
Gross profit 50 58 712
Administrative expenses (193) (207) (359)
---- ---- ----
(Loss)/Profit on ordinary
activities before: (143) (149) 353
Finance income 1 1 2
---- ---- ----
(Loss)/Profit on ordinary
activities before tax (142) (148) 355
Tax on (loss)/profit on ordinary - - -
activities
---- ---- ----
(Loss)/Profit on ordinary
activities after taxation (142) (148) 355
Dividends (145) (149) (149)
---- ---- ----
Retained (loss)/profit for
the period (287) (297) 205
---- ---- ----
(Loss)/Earnings per share 2 (0.18)p (0.18)p 0.44p
There were no recognised gains or losses other than the loss for
the period.
UNAUDITED BALANCE SHEET
as at 30 September 2013
As at As at As at
30 Sept 30 Sept 31 Mar 13
13 12
Unaudited Unaudited Audited
Note GBP'000 GBP'000 GBP'000
Assets
Current Assets
Coin inventory 3 10,785 10,443 10,926
Trade and other receivables 4 942 441 398
Cash at bank 114 444 368
---- ---- ----
Total Assets 11,841 11,328 11,692
---- ---- ----
Liabilities and Equity
Creditors: amounts falling
due within one year 5 494 197 58
---- ---- ----
Total Liabilities 494 197 58
---- ---- ----
Equity
Called up equity share
capital 6 808 808 808
Share premium 8,880 8,880 8,880
Profit and loss account 1,659 1,443 1,946
---- ---- ----
Total Equity Shareholders'
Funds 11,347 11,131 11,634
---- ---- ----
Total Liabilities and Equity 11,841 11,328 11,692
---- ---- ----
Diane Clarke Matt Wood
UNAUDITED CASH FLOW STATEMENT
as at 30 September 2013
1 April 1 April 1 April 12
13 12 to 31 Mar
to 30 Sept to 30 Sept 13
13 12
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP' 000
Cash flows from operating activities:
(Loss)/Profit for the period (143) (149) 353
Adjustments for:
Increase/(decrease) in payables 436 (33) (172)
(Increase)/decrease in receivables (544) (194) (151)
Decrease/(increase) in inventory 141 (331) (814)
---- ---- ----
Net cash flow from operations (110) (707) (784)
Interest received 1 1 2
---- ---- ----
Net cash received from investing
activities 1 1 2
Dividends paid (145) (149) (149)
---- ---- ----
Net cash from financing activities (145) (149) (149)
---- ---- ----
Net (decrease) in cash and cash
equivalents (254) (855) (931)
---- ---- ----
Opening cash position 368 1,299 1,299
---- ---- ----
Closing cash and cash equivalents 114 444 368
---- ---- ----
NOTES TO THE UNAUDITED INTERIM FINANCIAL STATEMENTS:
(1) Accounting policies
Basis of accounting
The unaudited interim financial statements have been prepared
under the historical cost convention and in accordance with
International Financial Reporting Standards. The accounting
policies and methods of computation in the unaudited interim
financial statements are the same as those of the audited financial
statements for the year ended 31 March 2013.
(2) Earnings per share
The loss per share for the period was 0.18p (H1 2012: loss of
0.18p). The calculation of (loss)/earnings per share is based on
the loss on ordinary activities after taxation of GBP142,000 for
the period (H1 2012: loss of GBP148,000) and the weighted average
number of shares in issue during the period under review remained
unchanged at 80,783,334 (2012: 80,783,334).
(3) Coin inventory
At the end of each financial year, the coin inventory is
re-valued to market value less the VAT payable on sale. Inventory
purchased since 31 March 2012 is included at its original cost
price and under the current valuation policy has not been the
subject of any revaluations. The valuation of the portfolio held as
at 31 March 2013 was carried out by industry experts and only those
coins held by the Company for at least 12 months were the subject
of a revaluation exercise. This is considered by the Directors to
give a fair value for the inventory. The Directors anticipate
undertaking a further revaluation exercise for the coming financial
year end.
(4) Trade and other receivables
As at As at As at
30 Sept 30 Sept 31 Mar 13
13 12
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Trade debtors 926 429 368
Prepayments and other debtors 16 12 30
---- ---- ----
Total 942 441 398
---- ---- ----
Trade receivables do not carry any interest and are stated at
their nominal value as recorded by appropriate allowances for
estimated irrecoverable amounts.
(5) Payables
As at As at As at
30 Sept 30 Sept 31 Mar 13
13 12
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Trade creditors 327 121 -
Accrued expenses 140 66 58
Other creditors 27 10 -
---- ---- ----
494 197 58
---- ---- ----
All creditors are due within one year.
(6) Share capital
As at As at As at
30 Sept 13 30 Sept 31 Mar 13
12
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Authorised
Ordinary shares of GBP0.01
each 2,000 2,000 2,000
---- ---- ----
Allotted, called up and fully
paid
Ordinary shares of GBP0.01
each 808 808 808
---- ---- ----
(7) Preparation of the Interim Report
This report was approved by the Directors on 17 December
2013.
The results for the period ended 30 September 2013 are unaudited
and do not constitute statutory accounts as defined in the
Companies Act.
Additional copies of this report are available from the
Company's registered office, Ground Floor, West Suite, Exchange
House, 54-58 Athol Street, Douglas, Isle of Man, IM1 1JD or via the
Company's website www.avarae.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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