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Stockcube plc Interim Report 2005
The Stockcube group produces research and analysis of the relative strengths and weaknesses of price
trends of stocks, stock indices, currencies, bonds and technical data to assist professional and non-
professional investors with the timing of investment transactions.
BOARD OF DIRECTORS
EDWARD FORBES Chairman
JULIAN BURNEY Chief Executive Officer
SHIRLEY YEOH Finance Director
ANDREW ASHMAN Director
TIMOTHY HORLICK Director *
DENNISON VERU Director *
* non executive
Stockcube plc Interim Report 2005
The Stockcube group produces research and analysis of the relative strengths and weaknesses of price
trends of stocks, stock indices, currencies, bonds and technical financial data that assist
professional and non-professional investors with the timing of investment transactions.
Highlights for the six months ended 30 June, 2005
* Turnover of �1,205,000 (2004: �1,258,000)
* Loss before tax of �20,000 (2004: profit �82,000)
* Profit before tax and impairment up 59% at �130,000 (2004: �82,000)
* Loss per share of (0.06)p (2004: earnings per share of 0.06p)
* Earnings per share before impairment 0.10p up 66% (2004: earnings per share 0.06p)
"Our underlying business remains strong. Turnover for the period is down slightly on 2004 but
attention to cost efficiencies has enabled us to double operating profit for the period. Profit on
ordinary activities before tax, and before provision for impairment of value in Sportcal, has
increased by 59%.
"Naturally, we are disappointed that Sportcal has not produced the returns we had expected at the
time of our investment, either from its underlying activities or from introductions of new business
leads for Ecube's technology services. We are actively considering the future of our holding in
Sportcal.
"On a happier note we are pleased with the progress made by our core activities and by the positive
responses we are receiving from clients and subscribers to the research and analysis that we produce
on their behalf. In addition, we welcome the direction from the Financial Services Authority
concerning payment for research services, to be implemented next year. This gives us greater
visibility with our client base and increased confidence that good research will be turned into
revenue."
Julian Burney
Chief Executive of Stockcube,
28 September, 2005
Enquiries:
Julian Burney Chief Executive Officer +44 (0)207-352-4001
Shirley Yeoh Finance Director +44 (0)207-352-4001
Our website is: www.stockcube.com
Chairman's Statement
Introduction
We continue to build our reputation for providing valuable and timely research and technical analysis to
customers around the globe in stocks and many other financial instruments.
Financial review
Turnover for the six months ended 30 June, 2005 amounted to �1,205,000, a slight decrease of 4% on
�1,258,000 recorded for the same period in 2004. Group operating profit increased to �49,000 compared
with �23,000 in 2004.
Whilst the group loss on ordinary activities before taxation of �(20,000) compares to a profit of
�82,000 in 2004, profit on ordinary activities before tax and before the exceptional impairment
charge for Sportcal was �130,000 compared with �82,000 in 2004.
We made our main investment in Sportcal in January, 2004 and have now reviewed our holding in
accordance with accounting standard FRS11 (Impairment of Fixed Assets and Goodwill). We have
concluded that recent and current trading, together with prospects for the immediate future, do not
support the carrying value in our books, as reduced by goodwill amortisation. Based on the
information presented to us by Sportcal's management we have written down our investment by �150,000.
Unadjusted losses of (0.06p) per 1p ordinary share for the period 30 June, 2005 compare to earnings
of 0.06p per share in 2004. However, underlying earnings per share, setting aside the Sportcal
impairment, increased to 0.10p per share compared with 0.06p for 2004.
We had cash balances of �3,872,000 at 30 June, 2005 compared with �3,561,000 at the beginning of the
year.
Review of operations
We have continued to consolidate our institutional investor consultancy and analysis services by
recruiting a number of experienced technicians. This will enable us to devote greater attention to
individual client requirements as well as to extend our client base.
The shake-out of subscribers following the switch from Fullermoney's monthly hardcopy publication to
daily on-line and audio formats and has now worked through and we are providing a more relevant and
valuable service to customers. Subscriptions are gradually building back up at higher unit prices
whilst, at the same time, we have been able to eliminate printing and postage costs.
Subscriptions to our wider market services under the Investors Intelligence brand increased during
the first half, mainly following the launch of our low price Exchange Traded Fund ('ETF') service in
the US and our UK stocks services in the UK.
Our software business, Ecube, has extended its customer base and we continue to seek new applications
and customers for our technology services.
As already stated, the investment in Sportcal has been a notable disappointment for us and we are
actively considering the future of our holding and the remedies that may be available to us to recoup
as much of our original cost as possible.
Trading outlook
We are as confident as ever that our underlying core business activities will continue to develop and
grow, generating future quality earnings.
Edward Forbes,
Chairman
London
28 September 2005
Group Profit and Loss Account
Unaudited Unaudited Audited
Six Months Six Months Year to
30 June 30 June 31 Dec
2005 2004 2004
�'000 �'000 �000
Turnover 1,205 1,258 2,430
Administrative expenses (1,156) (1,235) (2,360)
-------- -------- --------
Group operating profit 49 23 70
Impairment in investment in associate (150) - -
Share of operating profit/(loss) of associate 3 (14) (8)
Amortisation of goodwill arising on acquisition of associate (15) (15) (29)
-------- -------- --------
(162) (29) (37)
-------- -------- --------
(Loss)/profit on ordinary activities (113) (6) 33
Interest receivable and similar income 93 88 168
------- ------- -------
(Loss)/profit on ordinary activities before taxation (20) 82 201
Tax on (loss)/profit on ordinary activities (35) (22) (45)
------- ------- -------
(55) 60 156
Dividends - - (48)
------- ------- -------
(Loss)/profit retained for the period (55) 60 108
-------- -------- --------
Basic/diluted (loss)/ earnings per share (0.06)p 0.06p 0.16p
Basic/diluted earnings per share before impairment 0.10p 0.06p 0.16p
Group Statement of Total Recognised Gains & Losses
Unaudited Unaudited Audited
Six Months Six Months Year to
30 June 30 June 31 Dec
2005 2004 2004
(Loss)/profit for the period excluding share of profits/(losses) of (58) 74 164
associate
Share of profits/(losses) of associate 3 (14) (8)
------- ------- -------
(55) 60 156
Exchange differences on retranslation of net assets of subsidiary (17) 36 55
undertaking
------- ------- -------
Total recognised gains and losses during the period (72) 96 211
------- ------- -------
Group Balance Sheet
Unaudited Unaudited Audited
Six Months Six Months Year to
30 June 30 June 31 Dec
2005 2004 2004
�'000 �'000 �000
Fixed assets
Intangible assets 18 - 19
Tangible assets 340 351 345
Investments 239 408 400
-------- -------- --------
597 759 764
-------- -------- --------
Current assets
Debtors 441 488 550
Short term deposits 3,700 3,600 3,450
Cash at bank and in hand 172 205 111
-------- -------- --------
4,313 4,293 4,111
Creditors: amounts falling due within one year (772) (909) (665)
-------- -------- --------
Net current assets 3,541 3,384 3,446
-------- -------- --------
Total assets less current liabilities 4,138 4,143 4,210
-------- -------- --------
Capital and reserves
Called up share capital 961 961 961
Share premium account 3,774 3,774 3,774
Merger reserve 568 568 568
Profit and loss account (1,165) (1,160) (1,093)
-------- -------- --------
Equity shareholders' funds 4,138 4,143 4,210
-------- -------- --------
Approved by Order of the Board on 28 September 2005
Julian Burney
Director
GROUP STATEMENT OF CASH FLOWS
Unaudited Unaudited Audited
Six Months Six Months Year to
30 June 30 June 31 Dec
2005 2004 2004
�'000 �'000 �000
Net cash inflow/(outflow) from operating activities 276 31 (193 )
Returns on investments and servicing of finance
Interest received 93 88 168
Taxation - - (18)
Capital expenditure
Payments to acquire tangible fixed assets (10) (22) (36)
Payments to acquire intangible fixed assets - - (20)
-------- -------- --------
(10) (22) (56)
Acquisitions and disposals
Payments to acquire investments - (437) (437)
Equity dividends paid (48) - (48)
-------- -------- --------
Net cash inflow/(outflow) before financing 311 (340) (584)
Management of liquid resources
(Increase)/ decrease in short-term deposits (250) 280 430
-------- -------- --------
Increase/(decrease) in cash 61 (60) (154)
-------- -------- --------
GROUP STATEMENT OF CASH FLOWS
Reconciliation of net cash flow to movement in net funds
Unaudited Unaudited Audited
Six Months Six Months Year to
30 June 30 June 31 Dec
2005 2004 2004
�'000 �'000 �000
Increase/(decrease) in cash 61 (60) (154)
Increase/(decrease) in short-term deposits 250 (280) (430)
-------- -------- --------
Movement in net funds 311 (340) (584)
Net funds at 1 January 3,561 4,145 4,145
-------- -------- --------
NET FUNDS 3,872 3,805 3,561
-------- -------- --------
Analysis of net funds
Unaudited Unaudited Audited
Six Months Six Months Year to
30 June 30 June 31 Dec
2005 2004 2004
�'000 �'000 �000
Cash at bank and in bank 172 205 111
Short term deposits 3,700 3,600 3,450
-------- -------- --------
3,872 3,805 3,561
-------- -------- --------
NOTES TO THE INTERIM REPORT
1. Basis of preparation of interim financial information
The interim financial information has been prepared on the basis of the accounting policies set out in the group
statutory accounts for the year ended 31 December 2004. The taxation charge is calculated by applying
the directors' best estimate of the annual tax rate to the profit for the period. All other
accounting polices set out in the accounts for Stockcube Plc for the year ended 31 December 2004 were
applied for the purposes of this statement.
Basis of consolidation
The group accounts consolidate the accounts of Stockcube plc and all its subsidiary undertakings.
Associates are accounted for using the equity method.
2. Earnings per share
The calculation of the basic loss per ordinary share is based on losses of �55,000 (year to December 2004:profit
of �156,000, six months to 30 June 2004: profit �60,000) and on 96,106,300 (December 2004 and June
2004: 96,106,300) ordinary shares. The calculation of basic profit per ordinary share before
impairment is based on profits of �95,000 and on 96,106,300 ordinary shares.
There are no dilutive potential ordinary shares in 2005 (2004: nil).
3. Exceptional Item
In accordance with FRS 11, we have reviewed our investment in Sportcal, and based on current trading and future
prospects for the immediate future, we have written down our investment by �150,000.
4. Reconciliation of operating profit to net cash inflow from operating activities
Unaudited Unaudited Audited
Six Months Six Months Year to
30 June 30 June 31 Dec
2005 2004 2004
�'000 �'000 �000
Operating (loss)/profit (113) (6) 70
Impairment in investment in associate 150 - -
Depreciation 15 27 36
Management fee receivable - (10) -
Share of profit/(loss) of associate (3) 14 -
Goodwill amortisation 16 15 1
Decrease/(increase) in debtors 109 179 (250)
Increase/(decrease) in creditors 102 (188) (50)
-------- -------- --------
Net cash inflow/(outflow) from operating activities 276 31 (193)
-------- -------- --------
5.Publication of non-statutory accounts
The financial information contained in this statement does not constitute statutory accounts as defined in
section 240 of the Companies Act 1985. The financial information for the preceding full year, is
based on the statutory accounts of Stockcube plc, for the year ended 31 December 2004.Those accounts,
upon which the auditors issued an unqualified opinion, have been delivered to the Registrar of
Companies.
INDEPENDENT REVIEW REPORT TO STOCKCUBE PLC
Introduction
We have been instructed by the company to review the financial information for the six months ended 30 June
2005, which comprises the Group Profit and Loss Account, Group statement of Total Recognised Gains & Losses,
Group Balance Sheet, Group Statement of Cash Flows and the related notes 1 to 5. 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 is made solely to the company in accordance with guidelines contained in Bulletin 1999/4 "Review
of interim financial information" issued by the Auditing Practices Board. To the fullest extent
permitted by the law, we do not accept or assume any responsibility to anyone other than the company,
for our work, for this report, or for the conclusions we have formed.
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 issued by the London Stock Exchange.
Review work performed
We conducted our review in accordance with guidance contained in Bulletin 1999/4 'Review of interim
financial information' issued by the Auditing Practices Board for use in the United Kingdom. A
review consists principally of making enquiries of group 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 United Kingdom Auditing Standards 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 2005.
Ernst & Young LLP
London
28 September 2005
Stockcube PLC
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