27 June 2008
Microcap Equities PLC
("Microcap" or the "Company")
Final results for the year ended 31 December 2007
Chairman's Statement
I am pleased to report on the results of the Company for the year ended 31
December 2007.
The Company's operating loss decreased to �90,363 (2006: �92,399). The loss
before tax decreased to �86,432 compared to a loss last year of �91,880
excluding the interest paid on redemption of convertible unsecured loan notes.
This year �10,000 of convertible unsecured loan notes were redeemed.
Your directors continue to investigate ways of increasing shareholder value.
N. Greenstone
Chairman
25 June 2008
Further enquiries
Microcap Equities plc Tel: 020 7258 5140
Nicolas Greenstone
John East & Partners Limited Tel: 020 7628 2200
Simon Clements/Bidhi Bhoma
Income Statement
For the year ended 31 December 2007
Restated
Year ended Year ended
31 December 31 December
Note 2007 2006
� �
Administrative expenses (90,363) (92,399)
Operating loss (90,363) (92,399)
Interest receivable and similar income 2 3,931 718
Interest payable and similar charges 3 - (306,786)
Loss on ordinary activities before taxation (86,432) (398,467)
Tax on loss on ordinary activities 4 - -
Loss for the year (86,432) (398,467)
Loss per share (pence)
- Basic 5 (0.08p) (0.73p)
- Diluted (0.08p) (0.73p)
The Income Statement has been prepared on the basis that all operations are
continuing operations.
Statement of Recognised Income and Expenditure
For the year ended 31 December 2007
Restated
Year ended Year ended
31 December 31 December
2007 2006
� �
Net loss on available for sale investments (1,482) (85,000)
Net loss recognised directly in equity (1,482) (85,000)
Loss for the period (86,432) (398,467)
Total recognised income and expense for the (87,914) (483,467)
financial period
Statement of changes in equity
Share Share Retained Total
Capital Premium earnings
� � � �
At 1 January 2006 1,116,371 3,313,417 (4,334,521) 95,267
Issue of ordinary shares 593,174 - - 593,174
Loss for the year - - (398,467) (398,467)
Net loss on available for sale - - (85,000) (85,000)
assets
Transfer from share premium (306,587) 306,587 -
account
As at 31 December 2006 1,709,545 3,006,830 (4,511,401) 204,974
Issue of ordinary shares 20,000 - - 20,000
Loss for the year - - (86,432) (86,432)
Net loss on available for sale - - (1,482) (1,482)
investments
As at 31 December 2007 1,729,545 3,006,830 (4,599,315) 137,060
Balance Sheet
As at 31 December 2007
Note Restated
As at as at
31 December 31 December
2007 2006
� �
ASSETS
Non-current assets
Investments - available for sale 69,800 71,282
Current assets
Trade and other receivables 6 10,497 2,559
Cash and cash equivalents 9 85,338 176,041
95,835 178,600
LIABILITIES
Current liabilities
Trade and other payables 7 (28,575) (44,908)
Net Current Assets 67,260 133,692
NET ASSETS 137,060 204,974
SHAREHOLDERS' EQUITY
Called up share capital 1,729,545 1,709,545
Share premium account 3,006,830 3,006,830
Retained earnings (4,599,315) (4,511,401)
TOTAL EQUITY 137,060 204,974
Cash Flow Statement
For the year ended 31 December 2007
Notes Year Year
ended ended
31 December 31 December
2007 2006
�'000 �'000
Cash flows from operating activities
Cash expended from operations 8 (94,634) (145,965)
Net cash from operating activities (94,634) (145,965)
Cash flows from investing activities
Interest received 3,931 718
Interest paid - (199)
Net cash from investing activities 3,931 519
Cash flows from financing activities
New debenture loan - 306,587
Net cash from financing activities - 306,587
(Decrease)/Increase in cash and cash (90,703) 161,141
equivalents
Reconciliation of net cash flow to movement 9
in net funds
(Decrease)/Increase in cash and cash (90,703) 161,141
equivalents
Change in net funds (90,703) 161,141
Net funds at start of period 176,041 14,900
Net funds at end of period 9 85,338 176,041
Notes to the Financial Statements
For the year ended 31 December 2007
1. Accounting policies
The financial information set out in this preliminary announcement does not
constitute statutory accounts as defined in Section 240 of the Companies Act
1985.
The financial information for the year ended 31 December 2007 is extracted from
the Company's financial statements to that date which received an unqualified
auditor's report and will be filed with the Registrar of Companies in due
course.
The financial information for the year ended 31 December 2006 is a restatement
under IFRS of the Company's financial statements to that date which were
prepared under UK GAAP and which received an unqualified auditor's report and
have been filed with the Registrar of Companies.
2. Interest receivable and similar income
2007 2006
� �
Bank Interest 3,931 718
3. Interest payable and similar charges
2007 2006
� �
On bank loans and overdrafts - 199
Premium on redemption of loan notes - 306,587
- 306,786
4. Taxation
2007 2006
�'000 �'000
Current tax charge - -
Factors affecting the tax charge for the period
Loss on ordinary activities before taxation (86,432) (398,467)
Loss on ordinary activities before taxation multiplied by (25,930) (119,540)
standard rate of corporation tax of 30.0 per cent. (2006 -
30.0 per cent.)
Effects of:
Non deductible expenses - 33,466
Other tax adjustments 25,930 86,074
Current tax charge - -
As at 31 December 2007 a deferred tax asset of �414,686 (2006: �401,626)
existed due to unrelieved management expenses and interest of �1,481,020 (2006:
�1,388,755) at a rate of 28 per cent (2006: 30 per cent). No provision has been
made for this deferred tax asset due to the uncertainty over the availability
of future trading profits to offset against these losses.
5. Loss per share
The calculation of the basic loss per share is based on the loss on ordinary
activities after taxation of �86,432 (2006: �398,467) and on the weighted
average number of shares of 108,820,452 (2006: 54,400,540) ordinary shares in
issue during the year.
There was no dilutive effect from the share options outstanding during the
year.
6. Trade and other receivables
2007 2006
� �
Other receivables 6,863 1,309
Prepayments and accrued income 3,634 1,250
10,497 2,559
7. Trade and other payables
2007 2006
� �
Trade payables 17,486 8,155
Taxation and social security - 187
Directors current account 5,089 -
Accruals and deferred income 6,000 15,941
Convertible unsecured loan stock - 20,000
Other creditors - 625
28,575 44,908
8. Reconciliation of operating loss to net cash outflow from operating
activities
2007 2006
� �
Operating loss (90,363) (92,399)
(Increase)/Decrease in debtors (7,938) 48,839
Increase/(Decrease) in creditors within one year 3,667 (102,405)
Net cash (outflow) / inflow from operating activities (94,634) (145,965)
9. Analysis of net funds
1 Cash Other 31
January Flow non-cash December
2007 changes 2007
� � � �
Cash at bank and in hand 176,041 (90,703) - 85,338
Net funds 176,041 (90,703) - 85,338
10. Explanation of transition to IFRS
This is the first year that the Company has presented its financial statements
under IFRS. The following disclosures are required in the year of transition.
The last audited financial statements under UK GAAP were for the year ended 31
December 2006 and the date of transition to IFRSs was therefore 1 January 2007.
(a) Reconciliation of balance sheet at 1 January 2006 from UK GAAP TO IFRS
UK GAAP Effect of IFRS
transition
to IFRS
� � �
Assets
Non-current assets
Investments- available for sale 156,282 - 156,282
Current assets
Trade and other receivables 51,398 - 51,398
Cash and cash equivalents 14,900 - 14,900
Total current assets 66,298 - 66,298
Total assets 222,580 - 222,580
Liabilities
Current liabilities
Trade and other payables 127,313 - 127,313
Total liabilities 127,313 - 127,313
Net assets 95,267 - 95,267
Equity
Share capital 1,116,371 - 1,116,371
Share premium account 3,313,417 - 3,313,417
Retained losses (4,334,521) - (4,334,521)
Total equity 95,267 - 95,267
(b) Reconciliation of balance sheet at 31 December 2006 from UK GAAP TO IFRS
UK GAAP Effect of IFRS
transition
to IFRS
� � �
Assets
Non-current assets
Investments available for sale 71,282 - 71,282
Current assets
Trade and other receivables 2,559 - 2,559
Cash and cash equivalents 176,041 - 176,041
Total current assets 178,600 - 178,600
Total assets 249,882 - 249,882
Liabilities
Current liabilities
Trade and other payables 34,908 10,000 44,908
Total liabilities 34,908 10,000 44,908
Net assets 214,974 (10,000) 204,974
Equity
Share capital 1,709,545 - 1,709,545
Share premium account 3,016,830 - 3,016,830
Retained losses (4,511,401) (10,000) (4,521,401)
Total equity 214,974 (10,000) 204,974
(c) Reconciliation of the UK GAAP of profit and loss to the IFRS income
statement for the 6 months ended 31 December 2006
Audited Unaudited Unaudited
UK GAAP effect of IFRS
transition to
IFRS
� � �
Administrative expenses (92,399) - (92,399)
Operating loss (92,399) - (92,399)
Interest receivable and similar income 718 - 718
Impairment of available for sale (85,000) 85,000 -
investments
Interest payable and similar charges (296,786) (10,000) (306,786)
Loss on ordinary activities before (473,467) 75,000 (398,467)
taxation
Tax on loss on ordinary activities - - -
Loss for the year (473,467) 75,000 (398,467)
11. Copies of accounts will be sent to shareholders shortly and will also be
available at the Company's registered office, Thames House, Portsmouth Road,
Esher, Surrey KT10 9AD and on the Company's website www.microcapequities.plc.uk
END
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