Interim Results
January 11 2001 - 2:00AM
UK Regulatory
RNS Number:0461X
Clipper Ventures PLC
11 January 2001
FOR IMMEDIATE RELEASE 11 January 2001
CLIPPER VENTURES PLC
RESULTS FOR THE SIX MONTHS ENDED 31 OCTOBER 2000
Clipper Ventures PLC ("Clipper Ventures"), the AIM quoted yacht racing, marine
events, hospitality and training company, has announced its unaudited results
for the six months ended 31 October 2000. Following the recent change in year
end from 31 January to 30 April, the corresponding period last year was the
six months to 31 July 1999.
Key points
* The results were : turnover #1.68m (1999 : #735,000, restated)
operating loss #20,000 (1999 : #190,000, restated)
loss before tax #123,000 (1999 : #227,000, restated)
loss per share 1.00p (1999 : 2.57p, restated)
* The results reflect solid progress in core activities of organising
round-the-world yacht races and events, hospitality and training.
* Clipper Ventures recently announced its intention to focus on these core
activities which contributed some 90% of turnover during the first half year.
* The Times Clipper 2000 round-the-world race was fully sold and started
successfully last October; it is expected to finish in Portsmouth in September
2001.
* Higher profile for the 2000 race has led to substantially greater
interest already being shown in the next round-the-world race scheduled to
start in October 2002.
* The events, hospitality and training division contributed fully to
turnover and operating profit for the first time. Forward bookings are
strong.
* Clipper Online has been formed to assume responsibility for Clipper
Ventures' internet presence and to develop new online activities in support of
its core operations.
* Clipper Ventures holds a 9.4% interest in Offshore Telecom Plc whose
shares are scheduled to start trading on AIM on 12 January 2001.
* On outlook, Chairman, Sir Robin Knox-Johnston stated :
"The reorganisation announced in December 2000 means that Clipper
Ventures is likely to incur a loss for the full year to 30 April 2001. The
benefits of reduced costs, improving profitability and the longer term impact
of the increasing success of the Clipper round-the-world races should become
evident in our next financial year."
For further information, please contact :
Clipper Ventures PLC Sir Robin Knox-Johnston, Chairman
023-8023-7088 William Ward, Chief Executive
Richard Cooper, Managing Director
Tim Cowper, Finance Director
Buchanan Communications Steve Liebmann or Ed Cowdery
020-7466-5000
UNAUDITED RESULTS FOR THE SIX MONTHS ENDED 31 OCTOBER 2000
CHAIRMAN'S STATEMENT
Introduction
I am pleased to report Clipper Ventures' results for the six months ended 31
October 2000. During the course of 2000, Clipper Ventures changed its
financial year-end from 31 January to 30 April. Accordingly, the
corresponding period last year was the six months ended 31 July 1999, the
results of which have been restated in accordance with the company's new
accounting policies; details are set out below.
The results now reported reflect solid progress in our core activities of
organising round-the-world ("RtW") yacht races and corporate sailing. As
announced a month ago, Clipper Ventures will focus on these core activities
which contributed a very substantial proportion of turnover for the half year.
Results
Turnover for the half year increased to #1.68 million (1999 : #735,000). RtW
race event revenue from the sale of crew places was well ahead of the
comparable period and was assisted further by sponsorship income. The new
fleet of yachts for events, hospitality and training showed substantial growth
and contributed to profit for the first time. Non core activities accounted
for approximately 10% of turnover in the period. The operating loss was
reduced to #20,000 (1999 : #190,000). The loss before and after tax was #
123,000 (1999 : #227,000) and the loss per share was 1.00p (1999 : 2.57p).
As previously, the directors are not recommending the payment of an interim
dividend.
The directors have reviewed the accounting policies in order to provide a
truer reflection of the financial performance of the company. As in previous
periods, race crew income and expenditure has been recognised on the basis of
legs completed, however the integral method of accounting has been applied to
treat the interim period as six months of a twelve month period. The effect of
this is to recognise half of the year's expected crew income and expenditure
in this interim period. This gives a more consistent picture and fairly
reflects the activities of the company for the six month period. In addition,
a new accounting policy has been introduced to recognise sponsorship income
when it is receivable. This policy should fairly reflect the period over which
the sponsor derives benefit from sponsorship of the event.
Operations
Clipper round-the-world races
The Times Clipper 2000 RtW started successfully on 15 October 2000. The
concept of naming the boats after the cities which are backing them has
greatly increased the public following as well as sharpening the competition,
with the race order changing constantly. As we report, the fleet is crossing
the Pacific Ocean from the Galapagos Islands en route to Hawaii and is
expected to return to Portsmouth in September this year.
This race is Clipper Ventures' third RtW race and has attracted substantially
more media coverage than the previous RtW race which, in turn, attracted more
than the first race which started in 1996. Experience has shown that the
potential value of sponsorship reflects the media coverage achieved on the
previous event. The print and broadcast media coverage achieved to date for
the 2000 race is running at over five times the volume for the 1998 race at
the same stage. Clipper Ventures has commissioned external studies which give
rise to the projection that the media value of the Times Clipper 2000 will be
approximately #5 million, providing an excellent basis for the work which has
commenced on marketing the sponsorship rights as a major package for its 2002
and 2004 round-the-world races.
The value of running the RtW races as biennial events is demonstrated by the
level of interest already shown in the next event, scheduled to start in
October 2002. Clipper Ventures has received some 450 crew registrations
compared to fewer than 20 at the same stage for the 2000 event. The '
city-versus-city' theme is being taken international for 2002 and bids are
being generated from non-UK cities.
Events, hospitality and training
The period now reported on covers the peak season for events, hospitality and
training ("EHT"), with this business making a maiden contribution to profit.
In the comparable period last year, half of the new fleet of 38 foot yachts
were received during the period; some revenue was generated, but significant
start-up costs stopped the business from being profitable. A closer
integration between EHT and RtW race management will enable Clipper Ventures
to offer customers more comprehensive and attractive corporate sailing '
packages' while, at the same time, achieving substantial cost savings.
Current forward bookings are very strong and plans are being laid to cater for
the growing demand for 'adventure experiences' based on sailing to unusual
destinations.
Clipper Online
Earlier this week Clipper Ventures announced the formation of Clipper Online
and the reorganisation of its internet / web activities which support its
activities - and the RtW races in particular. During 2000, Clipper Ventures
assisted in the formation of Offshore Telecom Plc (formerly called
Clippertelecom plc) a company established to provide wireless communications
and internet services to the global offshore boating market. In addition,
this company assumed responsibility for developing and maintaining the
internet presence of Clipper Ventures and its activities.
Offshore Telecom has decided to focus its activities on its telecoms
interests. It has successfully completed a fund raising through a private
share placing and is seeking admission for its shares to the Alternative
Investment Market. As a natural outcome of the new priorities for Offshore
Telecom, the internet related services provided to Clipper Ventures have been
transferred to Clipper Online. Following Offshore Telecom's admission to AIM,
Clipper Ventures will hold 9.4% of Offshore Telecom. Clipper Online will also
develop new internet activities associated with Clipper Ventures activities
and will generate external revenues from advertising and e-commerce based on
the substantial traffic being generated. Since the start of the 2000 RtW in
October, there have been 2 million 'hits' from 50,000 unique users.
Other activities
As already reported, the rigid inflatable boat ("RIB") import, distribution
and charter business will be sold to a new company which will have the
resources to accelerate its development. Close links with this business will
be retained and will enable Clipper Ventures to have access to a fleet of RIBs
for corporate entertainment and other events. Although this business has not
yet moved into profitability, its disposal is expected to be completed at book
value. Elsewhere, the clothing division will be run down and the remaining
stock sold.
Outlook
The reorganisation announced in December 2000 means that Clipper Ventures is
likely to incur a loss for the full year to 30 April 2001. The benefits of
reduced costs, improving profitability and the longer term impact of the
increasing success of the Clipper round-the-world races should become evident
in our next financial year.
Sir Robin Knox-Johnston 11 January 2001
Chairman
PROFIT AND LOSS ACCOUNT
PERIOD ENDED 31 OCTOBER 2000
6 months to 6 months 15 months
31 October to 31 July to 30 April
2000 1999 2000
as restated
(unaudited) (unaudited) (audited)
#'000 #'000 #'000
TURNOVER 1,679 735 1,610
Cost of sales 1,302 469 1,205
------------ ------------ ------------
GROSS PROFIT 377 266 405
Marketing & Administrative expenses 397 456 1,415
------------ ------------ ------------
OPERATING LOSS (20) (190) (1,010)
Interest payable (103) (37) (185)
LOSS ON ORDINARY ACTIVITIES BEFORE
TAXATION
(123) (227) (1,195)
Tax on loss on ordinary activities - - -
------------ ------------ ------------
LOSS ON ORDINARY ACTIVITIES AFTER
TAXATION
(123) (227) (1,195)
Dividends (including non-equity) - - -
------------ ------------ ------------
LOSS FOR THE FINANCIAL PERIOD (123) (227) (1,195)
======== ======== ========
Earnings per share (pence) (1.00) (2.57) (11.83)
All of the activities of the company are classed as continuing.
STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
PERIOD ENDED 31 OCTOBER 2000
6 months 6 months 12 months
to 31 October to 31 July to 30 April
2000 1999 2000
as
restated
(unaudited) (unaudited) (audited)
#'000 #'000 #'000
Loss for the financial period
Attributable to the shareholders (123) (227) (1,195)
Impairment Adjustment - - (326)
----------- ----------- -----------
Total recognised gains and losses relating to
the period
(123) (227) (1,521)
Prior year adjustment (see note 2) - (292) (292)
----------- ----------- -----------
Total gains and losses recognised since the
last annual report
(123) (519) (1,813)
======= ======= =======
BALANCE SHEET
AT 31 OCTOBER 2000
31 October 31 July 30 April
2000 1999 2000
as
restated
(unaudited) (unaudited) (audited)
#'000 #'000 #'000
FIXED ASSETS
Tangible assets 3,090 3,339 3,128
------------ ------------ ------------
CURRENT ASSETS
Stocks 391 - 293
Debtors 2,746 1,515 2,464
Cash at bank and in hand 6 54 7
------------ ------------ ------------
3,143 1,569 2,764
CREDITORS: Amounts falling due within one
year
(5182) (3,569) (3,356)
------------ ------------ ------------
NET CURRENT ASSETS (2,039) (2,000) (592)
------------ ------------ ------------
TOTAL ASSETS LESS CURRENT LIABILITIES
1,051 1,339 2,536
------------ ------------ ------------
CREDITORS: Amounts falling due after more
than one year
(314) (313) (1,676)
------------ ------------ ------------
737 1,026 860
------------ ------------ ------------
CAPITAL AND RESERVES
Called-up share capital 319 489 319
Share premium account 1,601 303 1,601
Revaluation reserve - 326 -
Non-equity shareholders' fund - 18 -
Profit and loss account (1,183) (110) (1,060)
------------ ------------ ------------
SHAREHOLDERS' FUNDS (INCLUDING NON-EQUITY
INTERESTS)
737 1,026 860
======= ======= =======
CASH FLOW STATEMENT
PERIOD ENDED 31 OCTOBER 2000
6 months to 6 months 15 months
31 October to 31 July to 31
2000 1999 April
as 2000
restated
(unaudited) (unaudited) (audited)
#'000 #'000 #'000
NET CASH (OUTFLOW) / INFLOW FROM OPERATING
ACTIVITIES 756 (287) (1,079)
RETURNS ON INVESTMENTS AND
SERVICING OF FINANCE
Interest paid (102) (35) (276)
Interest element of finance lease rental (1) (1) (1)
payments
Non-equity dividends paid - - (16)
----------- ----------- -----------
Net cash outflow from returns on investments and
servicing of finance (103) (36) (293)
CAPITAL EXPENDITURE
Payments to acquire tangible fixed assets (88) (458) (780)
----------- ----------- -----------
CASH INFLOW / (OUTFLOW) BEFORE FINANCING 565 (781) (2,152)
FINANCING
Issue of equity share capital - 1 32
Share premium on issue of equity share capital - 54 1,352
Repayment of non-equity share capital - - (200)
Net (outflow)/inflow of bank loans (168) 86 200
Net outflow from loans - (31) (248)
Capital element of hire purchase rental payments (5) (3) 11
----------- ----------- -----------
NET CASH (OUTFLOW) / INFLOW FROM FINANCING (173) 107 1,147
----------- ----------- -----------
INCREASE / (DECREASE) IN CASH 392 (674) (1,005)
====== ====== ======
NOTES TO THE INTERIM REPORT
PERIOD ENDED 31 OCTOBER 2000
1. The interim accounts were approved by the Board of Directors on 10
January 2001.
2. The interim report has been prepared using accounting policies consistent
with those set out in the statutory accounts of the company for the
period ended 30 April 2000, except for the following changes:
i. Sponsorship Income
Sponsorship income is recognised when it is receivable.
There is not a material effect on prior periods.
ii. Race Income and Expenditure
The accounting policy adopted in these interim accounts is as follows:
Consistent with previous periods, where the duration of a race involves
more than one accounting period, the income and expenditure relating to that
race is allocated to the accounting period on the basis of the number of
legs completed. However, this interim six months has been treated as though
it is half of a twelve-month accounting period (1999 six months of a fifteen
month period) for recognition of costs and revenues.
In prior interim periods crew income and costs from the race has been
treated as a discrete accounting period.
The effect of the change is to recognise #789,000 of income and #
705,000 of expenditure for the period to 31 October 2000 that would have
been recognised in the second half of this financial year. In the interim
period to 31 July 1999, #482,000 of income and #391,000 of expenditure is
deferred to the final 9 months of that period ended 30th April 2000.
3. The interim financial information for the two half year periods is
unaudited and does not constitute statutory accounts within the meaning of
Section 240 of the Companies Act 1985. The results for the period ended 30
April 2000 have been extracted from the statutory accounts of the company on
which an unqualified auditors' report has been received and which have been
delivered to the Registrar of Companies.
4. Copies of this interim report are being sent to all shareholders
and will be available to the public from the company's registered office.
Nominated Advisor Corporate Synergy PLC, 12 Nicholas Lane, London EC4N 7BM
Nominated Broker Hoodless Brennan & Partners, 40 Marsh Wall, Docklands,
London E14 9TP
Registered Address Shamrock Quay, William Street, Northam, Southampton,
Hampshire SO14 5QL
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