Cleardebt Group PLC
05 March 2007
ClearDebt Group PLC
'ClearDebt' or 'the Group'
Interim Results for the 6 months ended 31 December 2006
ClearDebt Group PLC, the AIM quoted debt adviser and IVA provider, is pleased to
announce its Interim Results for the 6 months ended 31 December 2006.
Financial highlights
- Operating loss of £459,461 after amortisation of goodwill and
development costs of £173,279
- Placing of new shares to raise £1m for further corporate development
- Net cash balance of £1.18m
Operational highlights
- Development of specialist 'IVA Protect' insurance product, warmly
welcomed by creditors, which will prevent vast majority of IVA failures and
increase overall returns to creditors.
- 128 IVA's arranged for the period in question, 316 since trading commenced.
- Close involvement with the creation of the Debt Resolution Forum, an
industry body charged with creating the highest possible standards for the IVA
and debt management industry
- Currently in negotiations with several potential partners for referral
arrangements
David Mond, CEO said
'The past six months have proved a testing period for the IVA industry, with
creditors increasingly putting pressure on IVA providers to return a higher
proportion of the debtor payment.
Fortunately for ClearDebt, our flexible business model means we are able to
offer what we believe to be the lowest cost IVA currently available and have not
been failed by creditors on a fees basis. In addition, our innovative 'IVA
Protect' insurance product protects both debtor and creditor from the threat of
failure in case of involuntary unemployment or sickness, again increasing the
attraction of a ClearDebt IVA.
We are currently investing in a higher marketing spend and staff training and
are presently in negotiations with potential referral partners to increase our
pipeline and conversion rate. With steadily increasing personal levels of debt,
a finite number of IVA providers and our promising negotiations with the
creditor community, I have every reason to believe that whilst conditions remain
complex, ClearDebt can look to the future with cautious optimism.'
5 March 2007
For further information please contact
David Mond, CEO / Andrew Smith, Director of Marketing ClearDebt Group Plc
Tel: 0161 228 7444
Paddy Blewer, College Hill Associates
Tel: 020 7457 2020
David Youngman, W H Ireland
Tel : 0161 832 2174
ClearDebt Group PLC
CHAIRMAN'S STATEMENT
The Group made an operating loss of £459,461 (2005 loss £12,050) after
amortisation of goodwill and capitalised development costs of £173,279 (2005
£Nil) which is a credible performance considering the administrative delays and
reduced marketing spend reported upon in our trading update released on 16
October 2006, following our Annual General Meeting.
On the 29 December 2006, the Group raised £1,000,000 before expenses by means of
a placing of 31,746,031 new ordinary shares of 2p each to finance further
development of the ClearDebt model and to provide additional working capital.
The Group's Balance Sheet shows net current assets of £1,547,145 including cash
of £1,182,072 following the placing, which is sufficient to continue the Group's
second phase strategy.
Whilst current market conditions are complex, I have every confidence regarding
the Board's plans and with the Group's future prospects.
Gerald Carey FCIB
Chairman
5 March 2007
ClearDebt Group PLC
CHIEF EXECUTIVE'S STATEMENT
ClearDebt operates within the debt resolution sector which has emerged to
service the recent expansion in solutions to avoid bankruptcy.
Expansion of Individual Voluntary Arrangements ('IVAs') has continued un-abated
and 2006 has seen 44,332 cases (2005: 20,293 cases) being approved in England
and Wales.
ClearDebt's model is materially different from its competitors and recent voices
of concern from the banking and credit card industry indicating their desire to
see better dividends should serve ClearDebt well because of its low cost model.
ClearDebt is yet to have an IVA refused by creditors on pricing and has received
very positive feedback on its model from numerous significant creditors.
New relationships with the debt management and creditor communities are nearing
fruition which could lead to an increase of third party referrals to ClearDebt.
It is hoped that these relationships will increase the numbers of IVAs that
ClearDebt will be implementing over the next 6 months, thereby increasing
revenue.
Additionally a new DRTV and Press campaign was launched in February 2007
reinforcing our message and emphasising our unique IVA Protect product which has
been welcomed by creditors. IVA Protect ensures that if a debtor loses his job
or becomes ill during the period of his IVA then IVA Protect covers the monthly
instalment up to a maximum of 12 months (terms and conditions apply).
Whilst trading conditions are difficult, I am confident that current
relationship building and our different offer will augur well for the future,
particularly with the vital creditor community, which I look to with growing
confidence.
David Emanuel Merton Mond FCA FCCA
Chief Executive Officer
5 March 2007
ClearDebt Group PLC
Unaudited Consolidated Profit and Loss Account
for the six months ended 31 December 2006
Unaudited six Unaudited six Audited eighteen
months ended months ended months ended
31 December 2006 31 December 2005 30 June 2006
£ £ £
Turnover - continuing operations 226,780 -- 174,796
Operating Loss before financial expenses (459,461) (12,050) (429,267)
Interest received 8,907 -- (73,361)
Interest paid -- -- 89,512
________ _______ ________
Loss for the period before taxation (450,554) (12,050) (502,628)
________ _______ _______
Loss for the period (450,554) (12,050) (502,628)
Loss per share (basic and diluted) (0.17) p (0.10) p (0.55) p
The Group has no recognised gains or losses in the half-year ended 31 December
2006, other than those shown above.
ClearDebt Group PLC
Unaudited Consolidated Balance Sheet
as at 31 December 2006
Unaudited six Unaudited six Audited eighteen
months ended months ended months ended
31 December 2006 31 December 2005 30 June 2006
£ £ £
FIXED ASSETS
Intangible Assets 2,964,266 -- 3,137,545
Tangible Assets 170,532 -- 116,404
3,134,798 -- 3,253,949
CURRENT ASSETS
Trade and other receivables 593,275 1,881 443,387
Cash at bank and in hand 1,182,072 19,108 721,599
1,775,347 20,989 1,164,986
CURRENT LIABILITIES
Trade and other payables 228,202 21,132 286,437
NET CURRENT ASSETS/ (LIABILITIES) 1,547,145 (143) 878,549
NET ASSETS/(LIABILITIES) 4,681,943 (143) 4,132,498
CAPITAL AND RESERVES
Called up share capital 5,776,811 249,813 5,141,891
Share premium account 417,246 336,766 52,167
Profit and loss account (1,512,114) (586,722) (1,061,560)
4,681,943 (143) 4,132,498
ClearDebt Group PLC
Unaudited Consolidated Cash Flow Statement
for the six months ended 31 December 2006
Unaudited six Unaudited six Audited eighteen
months ended months ended months ended
31 December 2006 31 December 2005 30 June 2006
£ £ £
Net cash (outflow)/inflow (472,647) 7,991 (291,781)
Return on investments and servicing of finance 8,907 -- 16,151
Taxation -- -- --
Capital expenditure and financial investment (75,787) -- (31,333)
Acquisition of subsidiary -- -- 5,922
CASH OUTFLOW BEFORE FINANCING (539,527) 7,991 (301,041)
Financing 1,000,000 -- 1,010,734
INCREASE IN CASH IN THE PERIOD 460,473 7,991 709,693
Reconciliation of operating profit to net cash
inflow from operating activities
Operating (loss) (459,461) (12,050) (429,267)
Amortisation 173,279 -- 173,277
Depreciation 21,659 -- 16,666
(Increase)/decrease in debtors (149,888) 2,456 (269,499)
(Decrease)/increase in creditors (58,236) 17,585 217,042
(472,647) 7,991 (291,781)
Analysis of Cash Flows in Cash Flow Statement
RETURNS ON INVESTMENTS AND SERVICING OF FINANCE
Interest received 8,907 -- (73,361)
Interest paid -- -- 89,512
Nat cash inflow from returns on investments and
servicing of finance 8,907 -- 16,151
CAPITAL EXPENDITURE
Purchase of tangible fixed assets (75,787) -- (31,333)
FINANCING
Issue of ordinary share capital 1,000,000 -- 1,347,500
Issue cost -- -- (336,766)
Net cash inflow from financing 1,000,000 -- 1,010,734
At 1 July CASH FLOW 31 December 2006
2006
Analysis of net funds
Net cash- Cash at bank and in hand 721,599 460,473 1,182,072
ClearDebt Group PLC
Notes to the Interim Statements for the six months ended 31 December 2006
1. Basis of Accounting
The interim results are unaudited and do not constitute statutory accounts as
defined in section 240 of the Companies Act 1985. The financial information in
these interim unaudited financial statements has been prepared in accordance
with the accounting policies expected to be used in preparing the annual
financial statements for the year ending 30 June 2007, which do not differ
significantly from those used in the most recent financial statements. The
results for the eighteen months ended 30 June 2006 have been extracted from the
published accounts that have been delivered to the Registrar of Companies and
were audited by Baker Tilly and did not contain a statement under Section 237(2)
of the Companies Act 1985.
2. Loss per share
Loss per share is calculated by reference to the weighted average number of
shares in issue in the period amounting to 257,964,290 shares (six months to 31
December 2005: 12,490,650 shares; 18 months ended 30 June 2006: 91,235,958
shares) and on a loss after taxation of £450,554 (six months to 31 December
2005: loss £12,050; 18 months to 30 June 2006 loss £502,628) for the period.
3. Availability of Interim Report
A copy of this report is being sent to shareholders and copies can be downloaded
from www.cleardebtgroup.co.uk
This information is provided by RNS
The company news service from the London Stock Exchange D
