RNS Number:6601G
GruppeM Investments PLC
31 October 2007
31 October 2007
GruppeM Investments PLC
(LSE: GRP, 'GruppeM' or the 'Company')
Interim results for the six months ended 30 June 2007
GruppeM, the Aston Martin Importer for China and retailer of Porsche cars in the
country's Shandong region, today announces its interim results for the six
months ended 30 June 2007 which have been reviewed by the Company's auditors but
are unaudited.
Overview:
* 203 cars ordered and 191 cars delivered by the Porsche Qingdao dealership
in the six-month period;
* Revenues of #11.6 million (2006: #5.3 million);
* Profit before tax of #57,993 (2006: #252,918 loss);
* Earnings per share 0.05p (2006: 1.27p loss).
Significant post balance sheet events:
* CLB Littlejohn Frazer, a top 30 firm of chartered accountants and business
advisors, appointed as auditors;
* Stephanie Wong taking up appointment as Finance Director on 1 November
2007;
* GruppeM to launch Aston Martin brand into China at the end of November
2007, following agreement to import and distribute the brand to China retail
dealerships.
Commenting on the results and related developments, Kenny Chen, Chief Executive
Officer, said:
"This has been a great six months for GruppeM as it develops its luxury sports
cars portfolio. Demand for Porsche cars is continuing unabated with 203 cars
being ordered in the period from our Qingdao dealership. We have been granted
the right to retail Porsche cars within Shandong and are convinced that there is
much greater demand for the brand within the region. The opening of our second
Porsche dealership in the region's capital Jinan, (delayed to the first quarter
of 2008 due to the building work overrunning), will enable us to begin meeting
this demand and increasing sales volume going forward.
Our high reputation, allied with our deep understanding of the Chinese luxury
car market, has yielded an agreement with Aston Martin to import and distribute
the marque to retail dealerships within China. We are confident that the Aston
Martin brand, like other luxury brands before it, will be hugely popular within
the Chinese marketplace.
We are delighted to welcome Stephanie Wong as Finance Director to the Group.
Stephanie is Chinese, qualified as a CPA and practised within the US, and has
extensive experience of the Asia Pacific Region. We look forward to her
starting on 1 November 2007."
Enquiries:
GruppeM Investments PLC Shore Capital and Corporate Limited
Kenny Chen Alex Borrelli
Tel: +44 (0) 207 233 2952 Tel: +44 (0) 207 408 4090
CHAIRMAN'S STATEMENT
Background
GruppeM's most recent audited annual report covered the 17-month period to 31
December 2006. The interim financial statements below, for the six months ended
30 June 2007, have been reviewed by the Company's auditors but are unaudited.
The comparative period is from 1 January 2006 to 30 June 2006.
Board changes
We are delighted to welcome Stephanie Wong to the board as Finance Director from
1 November 2007. Originally from Hong Kong, Stephanie qualified as a CPA in
Texas in 1996, going on to complete an MBA at the University of Houston the
following year. She has held various senior finance roles, latterly as the Asia
Pacific Director of Finance and Operations for Fortinet Inc. - a leading
provider of multi-threat security systems in relation electronic communications.
The directors are confident that Stephanie's arrival will be a powerful
addition to the management team based in China.
Financial timetable and auditors
GruppeM's annual report for the 17-month period ended 31 December 2006 was
posted to shareholders today. Therefore, the directors anticipate that the
share suspension will be lifted, and that trading in the Company's shares will
resume, in the near future. The interim report, containing the unaudited
results below, will also be posted to shareholders today.
The release of our audited results for the 17 months ended 31 December 2006, and
unaudited interim results for the six months ended 30 June 2007, has been
delayed due to the audit of our Chinese subsidiaries being interrupted by a
routine audit by the Chinese tax authority from which no material issues arose.
The board is delighted to announce the appointment of CLB Littlejohn Frazer ("
CLBLF") as our new auditor. CLBLF is an independent 'top 30' firm of chartered
accountants and business advisers based in Canary Wharf in London.
Results and business review
The Group continues to grow rapidly thanks to the increasing volume of sales of
Porsche cars. Turnover increased significantly to #11.6 million (period to 30
June 2006: #5.3 million). The pre-tax profit from operations for the period was
#57,993 against a loss of #252,918 for the period to 30 June 2006. Earnings per
share were 0.05 pence (2006: 1.27 pence loss). The directors will not be
recommending the payment of an interim dividend.
The Porsche Qingdao dealership performed strongly with 203 cars ordered and 191
cars delivered in the period. Demand for the brand remains strong with customers
currently waiting approximately six months for their new car.
The Company has recently opened a Porsche sales office in Jinan, the capital of
the Shandong region, and has already made several sales. The new Porsche Jinan
dealership and workshop is now planned to open in Q1 of 2008.
We are pleased that GruppeM has been appointed as the only importer and
distributor of Aston Martin motor cars to retail dealerships within China.
Initially GruppeM will be supplying the brand to third-party dealers, rather
than retailing the brand through its own dealerships.
GruppeM is excited at the prospect of launching the Aston Martin brand into
China at the end of November 2007. We are delighted to announce that the launch
will be attended and supported by the Aston Martin board.
Our success in regard to the appointment of GruppeM as sole importer and
distributor of Aston Martin in China is consistent with HMG's clearly stated
business strategy for the Chinese market, both in terms of exports and the need
to strengthen the growth of City of London listed companies in the rapid growing
economy of China. The British Embassy and other regional offices are supporting
this initiative to the fullest.
Market prospects
According to the Xinhua News Agency's recent report, the world's luxury car
makers are very enthusiastic about the great growth potential in China's auto
industry. Porsche China's Managing Director was quoted as saying that he
expects the growth in sales of the marque to increase beyond the doubling of
volume seen last year. Also, the general manager of Bentley in China (which
occupies a similar market position to Aston Martin) outlined that the sales to
the end of September 2007 outstripped the total sales for 2006, and that he
fully expects sales volume to reach 300 units by the end of this year. He
commented that the fast expanding economy, and rising income, will inevitably
boost consumer demand for luxury cars.
We appreciate your continuing support in our efforts to increase our share of
the burgeoning luxury car market in China. Finally, I would also like to thank
all our employees and advisors for their contribution to our success.
Don McCrickard
Chairman
30 October 2007
GRUPPEM INVESTMENTS PLC
CONSOLIDATED INCOME STATEMENT
FOR THE 6 MONTHS ENDED 30 JUNE 2007
6 months ended 6 months 17 months
30 June ended ended 31
2007 30 June December 2006
2006
(unaudited) (unaudited) (audited)
Note # # #
Revenue 11,551,698 5,258,243 12,099,616
Cost of sales (10,644,692) (4,876,656) (11,239,678)
Gross Profit 907,006 381,587 859,938
Administrative expenses (839,768) (541,465) (1,823,174)
Exceptional items - (88,125) -
Operating Profit/(Loss) 67,238 (248,033) (963,236)
Finance income and expense (net) (9,305) (4,915) 13,628
Profit/(Loss) for the Period before Taxation 57,993 (252,918) (949,608)
Taxation (9,919) (163) (13,172)
Profit/(Loss) for the Period 48,014 (253,081) (962,780)
Earnings/(loss) per share expressed in pence
per share
- Basic 2 0.05p (1.27)p (3.27)p
- Diluted 2 0.05p - -
All amounts relate to continuing activities.
CONSOLIDATED STATEMENT OF RECOGNISED INCOME AND EXPENSE
FOR THE 6 MONTHS ENDED 30 JUNE 2007
6 months 6 months 17 months
ended ended ended 31
30 June 30 June December 2006
2007 2006
(unaudited) (unaudited) (audited)
# # #
Profit/(loss) for the financial period 48,014 (253,081) (962,780)
Exchange adjustments 6,611 (22,700) (46,650)
Total Recognised Income and Expense 54,625 (275,781) (1,009,430)
for the Period
GRUPPEM INVESTMENTS PLC
CONSOLIDATED BALANCE SHEET AS AT 30 JUNE 2007
Notes As at As at As at
30 June 30 June 31 December
2007 2006 2006
(unaudited) (unaudited) (audited)
# # #
Assets
Non-Current Assets
Property, plant and equipment 456,029 509,322 499,850
456,029 509,322 499,850
Current Assets
Inventory 152,894 62,585 836,672
Trade and other receivables 3,964,353 1,354,307 2,791,348
Cash and cash equivalents 139,729 45,652 126,556
4,256,976 1,462,544 3,754,576
Total Assets 4,713,005 1,971,866 4,254,426
Liabilities
Current Liabilities
Trade and other payables 2,692,856 2,276,518 2,433,149
2,692,856 2,276,518 2,433,149
Non-Current Liabilities
Director's loan account 3,570,516 454,624 3,414,011
Convertible loan 100,366 - 99,402
Related party loan 182,000 182,000 182,000
3,852,882 636,624 3,695,413
Total Liabilities 6,545,738 2,913,142 6,128,562
Capital and Reserves
Share capital 3 1,000,000 200,000 1,000,000
Merger reserve 4 (1,392,156) - (1,392,156)
Foreign operation translation reserve 4 38,104 33,009 44,715
Retained deficit 4 (1,478,681) (1,174,285) (1,526,695)
(1,832,733) (941,276) (1,874,136)
Total Equity and Liabilities 4,713,005 1,971,866 4,254,426
GRUPPEM INVESTMENTS PLC
CONSOLIDATED CASH FLOW STATEMENT
FOR THE 6 MONTHS ENDED 30 JUNE 2007
6 months 6 months 17 months ended
ended ended
30 June 30 June 31 December
2007 2006 2006
(unaudited) (unaudited) (audited)
# # #
Cash Flow from Operating Activities
Profit/(loss) from operating activities 67,238 (248,003) (963,236)
Adjustments for:
Depreciation 86,430 51,370 176,334
Exchange adjustment on property, plant and (2,569) 656 6,616
equipment
Net Cash Flow from Operating Activities before 151,099 (195,977) (780,286)
Changes in Working Capital
Decrease/(increase) in inventories 683,778 92,022 (836,672)
Increase in payables 490,648 417,488 2,045,882
(Increase)/decrease in receivables (1,403,946) 160,605 (2,496,638)
Net Cash Flow from Operating Activities before (78,421) 474,138 (2,067,714)
Interest and Taxation Paid
Interest paid (8,365) (4,940) (2,046)
Taxation (9,919) (163) (1,820)
Net Cash Flow from Operating Activities (96,705) 469,035 (2,071,580)
Investing Activities
Purchase of property, plant and equipment (40,040) (550,703) (598,863)
Sale of property, plant and equipment - - 24,555
Interest received 24 25 76
Net Cash Flow from Investing Activities (40,016) (550,678) (574,232)
Financing Activities
Cost of share issue - - (592,156)
Issue of convertible loan notes - - 115,000
Director's loan 156,505 71,167 3,076,141
Net Cash Flow from Financing Activities 156,505 71,167 2,589,985
Net Increase/(Decrease) in Cash and Cash 19,784 (10,476) (55,827)
Equivalents in the Period
Cash and cash equivalents at the beginning of 126,556 43,081 135,733
the period
Effect of foreign exchange rate changes on cash (6,611) 13,047 46,650
and cash equivalents
Cash and Cash Equivalents at the end of the 139,729 45,652 126,556
Period
NOTES TO THE INTERIM ANNOUNCEMENT
1. Basis of Preparation
These interim statements have been prepared on a consistent basis with the
Financial Statements for the period ended 31 December 2006.
These interim statements do not constitute statutory Financial Statements within
the meaning of Section 240(5) of the Companies Act 1985. Neither the results
for the six months ended 30 June 2007, nor the comparatives for the six months
ended 30 June 2006, have been audited. The statutory Financial Statements for
the 17 months ended 31 December 2006 contained an unqualified auditors' report
in accordance with Section 235 of the Companies Act 1985.
This financial information has been prepared in accordance with International
Financial Reporting Standards (IFRSs) as adopted by the European Union (EU) and
IFRIC interpretations that are relevant to its operations. The financial
information has been prepared under the historical cost convention.
The preparation of this financial information in conformity with generally
accepted accounting principles requires the use of estimates and assumptions
that affect the reported amounts of assets and liabilities at the date of the
financial information and the reported amounts of revenues and expenses during
the reporting period. Although these estimates are based on management's best
knowledge of the amount, event or actions, actual results ultimately may differ
from those estimates.
Basis of Consolidation
The consolidated Financial Statements consist of GruppeM Investments PLC and its
subsidiaries. The consolidated Financial Statements of GruppeM Investments PLC
have been prepared under merger accounting rules. This means that the Financial
Statements of GruppeM Investments PLC, and its wholly owned subsidiary GruppeM
Hong Kong Limited, have been aggregated and presented as if the two companies
have always formed a group.
Where necessary, adjustments are made to the Financial Statements of the
subsidiaries to bring their accounting policies into line with those used by
other members of the Group. All intra-group transactions, balances, income and
expenses are eliminated on consolidation.
2. Profit/(Loss) per Ordinary Share
Basic earnings per share is calculated by dividing the earnings attributable to
ordinary shareholders by the weighted average number of ordinary shares
outstanding during the period.
In order to calculate diluted earnings per share, the weighted average number of
ordinary shares in issue is adjusted to assume conversion of all dilutive
potential ordinary shares according to IAS 33. Dilutive potential ordinary
shares include convertible loan notes and are assumed to have been converted
into ordinary shares.
6 months to 30 June 2007 6 months to 30 June 2006
Weighted Per share Weighted Per share amount
average amount average
number of number of
Profit shares Loss shares
# pence # pence
Basic EPS
Profit/(loss) 48,014 100,000,000 0.05 (253,081) 20,000,000 (1.27)
attributable to
ordinary shareholders
Convertible loan note - 2,300,000 - - - -
Diluted EPS 48,014 102,300,000 0.05 (253,081) 20,000,000 (1.27)
3. Share Capital
30 June 2007 30 June 2007 30 June 2006 30 June 2006
No. # No. #
Authorised:
Ordinary shares of 1p each 200,000,000 2,000,000 100,000,000 1,000,000
Issued and fully paid:
Ordinary shares of 1p each 100,000,000 1,000,000 20,000,000 200,000
4. Movement on Reserves
The merger reserve represents a reserve arising on consolidation, being the
share capital and share premium account balances of GruppeM Hong Kong Limited at
1 February 2005, i.e., its date of incorporation less the nominal value of the
shares issued by the Company to acquire the shares, reflecting the position as
if the merger had occurred on 1 February 2005.
Group Share capital Merger Foreign Total
reserve currency
translation Retained
reserve earnings
# # # # #
At 1 January 2006 200,000 - 10,309 (921,204) (710,895)
Loss for the period - - - (253,081) (253,081)
Foreign exchange translation - - 22,700 - 22,700
At 30 June 2006 200,000 - 33,009 (1,174,285) (941,276)
Acquisition 800,000 - - - 800,000
Arising on share issue, less expenses - (1,392,156) - - (1,392,156)
Loss for the period - - - (352,410) (352,410)
Foreign exchange translation - - 11,706 - 11,706
At 31 December 2006 1,000,000 (1,392,156) 44,715 (1,526,695) (1,874,136)
Profit for the period - - - 48,014 48,014
Foreign exchange translation - - (6,611) - (6,611)
At 30 June 2007 1,000,000 (1,392,156) 38,104 (1,478,681) (1,832,733)
Independent Review Report to the Directors of GruppeM Investments PLC
Introduction
We have been instructed by the Company to review the financial information for
the six months ended 30 June 2007 which comprises the consolidated income
statement, the consolidated balance sheet, the consolidated statement of
recognised income and expense, the consolidated cash flow statement and the
related notes. We have read the other information contained in the interim
report and considered whether it contains any apparent misstatements or material
inconsistencies with the financial information.
This report, including the conclusion, has been prepared for and only for the
Company for the purpose of the AIM Rules of the London Stock Exchange and for no
other purpose. We do not, in producing this report, accept or assume
responsibility for any other purpose or to any other person to whom this report
is shown or into whose hands it may come save where expressly agreed by our
prior consent in writing.
Directors' Responsibilities
The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by the directors. The directors are
responsible for preparing the interim report in accordance with the AIM Rules of
the London Stock Exchange which require that the accounting policies and
presentation applied to the interim figures should be consistent with those
applied in preparing the annual accounts except where any changes, and the
reasons for them, are disclosed.
Review Work Performed
We conducted our review in accordance with the guidance contained in Bulletin
1999/4 issued by the Auditing Practices Board for use in the United Kingdom. A
review consists principally of making enquiries of management and applying
analytical procedures to the financial information and underlying financial data
and, based thereon, assessing whether the accounting policies and presentation
have been consistently applied unless otherwise disclosed. A review excludes
audit procedures such as tests of controls and verification of assets,
liabilities and transactions. It is substantially less in scope than an audit
performed in accordance with International Standards on Auditing (UK and
Ireland) and therefore provides a lower level of assurance than an audit.
Accordingly, we do not express an audit opinion on the financial information.
Review Conclusion
On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the six months
ended 30 June 2007.
CLB Littlejohn Frazer
Chartered Accountants and Registered Auditors
1 Park Place
Canary Wharf
London E14 4HJ
30 October 2007
Circulation to Shareholders
The interim report and accounts will be posted to shareholders in due course and
will be available to the public from the Company's registered office at GruppeM
Investments PLC, Suite 1.3 Buckingham Court, 78 Buckingham Gate, London, SW1E
6PD.
For more information please contact:
GruppeM Investments PLC
Kenny Chen
Tel: +44 (0) 207 233 2952
Shore Capital and Corporate Limited
Alex Borrelli
Tel: +44 (0) 207 408 4090
Further information on GruppeM Investments PLC can be found on the Company's
website: www.gruppemplc.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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