RNS Number:8737D
Bright Futures Group PLC
01 June 2006
BRIGHT FUTURES GROUP PLC
RESULTS FOR THE YEAR ENDED 31 DECEMBER 2005
CHAIRMAN'S STATEMENT
For the year ended 31 December 2005
In light of the difficulties being encountered in the retail sector, the
Directors concluded that the business of the Company was unlikely to achieve a
significant return for it's shareholders in the foreseeable future. In view of
this, an offer was accepted from Sussex Wellbeing Limited to acquire the share
capital of the trading subsidiaries Cascade Ventures Limited, The Mobility Group
Limited, Youreable Limited, Scootermart Mobility Centres Limited, ScooterMart
Limited and Ortho Kinetics (UK) Limited together with the trading business and
associated assets and liabilities of Bright Futures Group plc. Completion of the
disposal took place on 30 March 2006.
The subsidiaries were disposed of for a consideration of #913,719. Following the
disposal of the trading subsidiaries Bright Futures Group plc no longer has a
trading business. The funds from the disposal, which after the deduction of
transaction costs and other expenses are approximately #750,000 as at the end of
May, will be used by the Company to consider new trading opportunities.
The existing Board of Directors have been with Bright Futures throughout its
development but have concluded that as the company has now ceased to have any
trading operations, it would be in the best interests of shareholders for them
to stand down in favour of individuals who specialise in identifying and
acquiring small businesses.
Anthony Leon DL FCA
Non-executive Chairman
Principal Activities
The principal activities of the Group during the year were the supply of battery
scooters, lifting chairs and aids for disabled individuals. The Group also
operated a website that catered for the needs of the disabled.
Review of Business and Future Developments
The review of the business is set out in the Chairman's Statement.
Results and Dividends
The loss for the period, after taxation, amounted to #3,077,414 (2004 -
#202,871). The Directors do not recommend the payment of a dividend.
On 30 March 2006 the Company completed the sale of all of its subsidiaries, and
of certain of its assets and liabilities, to Sussex Wellbeing Limited for a cash
consideration of #913,719. This has resulted in a write down in the Company's
investments of #2,877,213, and an impairment charge to the Group's goodwill on
consolidation of #2,036,014.
During the year costs of #190,035 were incurred following reorganisation within
the Group.
Post Balance Sheet Events
As explained in the Chairman's Statement the share capital of the subsidiary
companies and certain of Bright Futures Groups plc's assets and liabilities were
acquired by Sussex Wellbeing Limited on 30 March 2006 for a consideration of
#913,719.
This report was approved by the Board on 30 May 2006 and signed on its behalf.
CONSOLIDATED PROFIT AND LOSS ACCOUNT
For the year ended 31 December 2005
Year ended Year ended
31 Dec 2005 31 Dec 2004
Note # #
TURNOVER 2 3,524,842 4,631,539
Cost of sales (1,957,031) (2,687,375)
----------------------------------
GROSS PROFIT 1,567,811 1,944,164
Goodwill impairment 9 (2,036,014) -
Goodwill amortisation (129,768) (122,822)
Operating costs (2,487,240) (2,030,128)
----------------------------------
Administrative expenses (4,653,022) (2,152,950)
----------------------------------
OPERATING LOSS 3 (3,085,211) (208,786)
Net interest receivable and similar charges 7,797 6,652
----------------------------------
LOSS ON ORDINARY ACTIVITIES BEFORE TAXATION (3,077,414) (202,134)
TAX ON LOSS ON ORDINARY ACTIVITIES 6 - (737)
----------------------------------
LOSS FOR THE FINANCIAL PERIOD (3,077,414) (202,871)
----------------------------------
Loss per share - basic and diluted 8 (6.43)p (0.57)p
Loss per share before goodwill amortisation - basic and diluted 8 (1.91)p (0.22)p
The Group has no recognised gains or losses other than the results for the year
as set out above.
All of the activities of the Group are classed as discontinuing following the
sale of the trading subsidiaries on 30 March 2006. The Company will have certain
administrative expenses going forward relating to non-executive directors and
costs associated with being listed on the AIM market.
CONSOLIDATED BALANCE SHEET
As at 31 December 2005
2005 2004
Note # #
FIXED ASSETS
Intangible fixed assets 9 96,664 2,162,446
Tangible fixed assets 10 439,985 353,987
----------------------------
536,649 2,516,433
----------------------------
CURRENT ASSETS
Stocks 12 722,129 839,792
Debtors 13 380,547 709,168
Cash at bank and in hand 403,395 1,011,428
----------------------------
1,506,071 2,560,388
CREDITORS: amounts falling due within one year 14 (488,533) (614,217)
----------------------------
NET CURRENT ASSETS 1,017,538 1,946,171
----------------------------
TOTAL ASSETS LESS CURRENT LIABILITIES 1,554,187 4,462,604
CREDITORS: amounts falling due after more than one year 15 (137,309) (63,312)
PROVISONS FOR LIABILITIES 17 (95,000) -
----------------------------
NET ASSETS 1,321,878 4,399,292
----------------------------
CAPITAL AND RESERVES
Called up share capital 19 2,392,501 2,392,501
Share premium account 20 147,821 147,821
Other reserve 20 - 2,023,515
Profit and loss account 20 (1,218,444) (164,545)
----------------------------
EQUITY SHAREHOLDERS' FUNDS 21 1,321,878 4,399,292
----------------------------
COMPANY BALANCE SHEET
As at 31 December 2005
2005 2004
Note # #
FIXED ASSETS
Investments 11 663,710 3,540,923
----------------------------
CURRENT ASSETS
Debtors 13 250,000 1,578,652
CREDITORS: amounts falling due within one year 15 (470) (533,830)
----------------------------
NET CURRENT ASSETS 249,530 1,044,822
----------------------------
TOTAL ASSETS LESS CURRENT LIABILITIES 913,240 4,585,745
----------------------------
CAPITAL AND RESERVES
Called up equity share capital 19 2,392,501 2,392,501
Share premium account 20 147,821 147,821
Other reserves 20 - 2,317,500
Profit and loss account 20 (1,627,082) (272,077)
----------------------------
EQUITY SHAREHOLDERS' FUNDS 21 913,240 4,585,745
----------------------------
CONSOLIDATED CASH FLOW STATEMENT
For the year ended 31 December 2005
2005 2005 2004 2004
# # # #
Net cash flow from operating activities (364,177) (177,712)
RETURNS ON INVESTMENTS AND SERVICING OF FINANCE
Interest received 14,778 6,652
Interest element of hire purchase (6,981) -
-----------------------------------------------------------
NET CASH INFLOW FROM RETURNS ON INVESTMENT AND 7,797 6,652
SERVICING OF FINANCE
TAXATION - (7,117)
CAPITAL EXPENDITURE
Receipts from sale of tangible fixed assets - 5,812
Payments to acquire tangible fixed assets (229,145) (131,516)
-----------------------------------------------------------
NET CASH OUTFLOW FROM CAPITAL EXPENDITURE (229,145) (125,704)
-----------------------------------------------------------
CASH OUTFLOW BEFORE FINANCING (585,525) (303,881)
FINANCING
Issue of equity share capital - 870,000
Professional costs charged to share premium account - (35,502)
Capital element of hire purchase (22,508) (7,744)
-----------------------------------------------------------
NET CASH INFLOW FROM FINANCING (22,508) 826,754
-----------------------------------------------------------
(DECREASE)/INCREASE IN CASH (608,033) 522,873
-----------------------------------------------------------
RECONCILIATION OF OPERATING LOSS TO NET CASH OUTFLOW
FROM OPERATING ACTIVITIES
Year ended Year ended
31 Dec 2005 31 Dec 2004
# #
Operating loss (3,085,211) (208,786)
Amortisation 129,768 122,822
Impairment 2,036,014 -
Depreciation 125,213 92,413
Loss on disposal of fixed assets 50,462 -
Decrease/(increase) in stocks 117,663 (32,661)
Decrease in debtors 328,621 52,346
Decrease in creditors (161,707) (203,846)
Increase in provisions 95,000 -
--------------------------------------
Net cash outflow from operating profits (364,177) (177,712)
--------------------------------------
RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET FUNDS
2005 2004
# #
(Decrease)/increase in cash in the year (608,033) 522,873
Cash flow in respect of hire purchase 22,508 7,744
--------------------------------------
Change in net funds resulting from cash flows (585,525) 530,617
New hire purchase (132,528) (93,425)
--------------------------------------
Movement in net funds in the year (718,053) 437,192
Net funds at 31 December 2004 919,005 481,813
--------------------------------------
Net funds at 31 December 2005 200,952 919,005
--------------------------------------
ANALYSIS OF CHANGES IN NET FUNDS
Other
At Non-cash At
1 Jan 2005 Cashflows changes 31 Dec 2005
# # # #
Net Cash:
Cash in hand and at bank 1,011,428 (608,033) - 403,395
Debt:
Hire purchase agreements (92,423) 22,508 (132,528) (202,443)
---------------------------------------------------------------------
Net funds 919,005 (585,525) (132,528) 200,952
---------------------------------------------------------------------
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 December 2005
1. ACCOUNTING POLICIES
Basis of preparation of financial statements
The financial statements have been prepared under the historical cost convention
and are prepared in accordance with applicable accounting standards.
Basis of consolidation
The consolidated accounts incorporate the accounts of the Company and all group
undertakings. Acquisitions are accounted for under the acquisition method and
goodwill on consolidation is capitalised and amortised over its estimated useful
life from the year of acquisition. The results of companies acquired or disposed
of are included in the profit and loss account after or up to the date that
control passes.
As a consolidated profit and loss account is published, a separate profit and
loss account for the parent company is omitted from the Group accounts by virtue
of section 230 of the Companies Act 1985.
Turnover and revenue recognition
The turnover shown in the Group profit and loss account represents goods and
services sold to customers outside the Group, less returns, discounts and VAT.
Income is recognised when goods are despatched to our customers in the retail
stores. Website income is recognised when the service has been provided.
Amortisation
Amortisation is calculated so as to write off the cost of intangible assets less
their estimated residual value, over the useful economic life of the assets as
follows:
Goodwill - 20 years
Domain names - 33% p.a. straight line
Goodwill is reviewed for impairment at the end of the first full financial year
following the acquisition and in other periods if events or changes in
circumstances indicate that the carrying value may not be recoverable.
Depreciation
Depreciation is calculated so as to write off the cost of an asset, less its
estimated residual value, over the useful economic life of that asset as
follows:
Plant & office equipment and website - 20% to 33% p.a. straight line
Retail store fittings - 20% straight line
Motor vehicles - 33% p.a. straight line
Investments
Fixed asset investments are stated at cost except where in the opinion of the
Directors, there has been an impairment of the value of the investments, in
which case an appropriate adjustment is made to the carrying value.
Stock
Stocks are valued at the lower of cost and net realisable value, after making
due allowance for obsolete and slow moving items
Finance leases and hire purchase contracts
Assets obtained under hire purchase agreements and finance leases are
capitalised as tangible fixed assets. Assets acquired by finance leases are
depreciated over the shorter of the lease term and their useful lives. Assets
acquired by hire purchase are depreciated over their useful lives. Finance
leases are those where substantially all of the benefits of ownership are
assumed by the Group. Obligations under such agreements are included in
creditors, net of the finance charge allocated to future periods, The finance
element of the rental payment is charged to the profit and loss account so as to
produce a constant periodic rate of charge on the net obligations outstanding in
each period.
Operating lease agreements
Rentals applicable to operating leases where substantially all of the benefits
and risks of ownership remain with the lessor are charged against profits on a
straight line basis over the period of the lease.
Deferred taxation
Deferred tax is recognised in respect of all timing differences that
have originated but not reversed at the balance sheet date where transactions or
events have occurred at that date that will result in an obligation to pay more,
or a right to pay less or to receive more, tax, with the following exceptions:
* deferred tax assets are recognised only to the extent that the Directors
consider that it is more likely than not that there will be suitable
taxable profits from which the future reversal of the underlying timing
differences can be deducted;
* deferred tax is measured on an undiscounted basis at the tax rates that are
expected to apply in the periods in which timing differences reverse,
based on tax rates and laws enacted or substantively enacted at the
balance sheet date.
Foreign currency
Assets and liabilities in foreign currencies are translated into sterling at the
rates of exchange ruling at the balance sheet date. Transactions in foreign
currencies are translated into sterling at the rate of exchange ruling at the
date of the transaction. Exchange differences are taken into account in arriving
at the operating profit.
Pensions
The Company makes payments into an individual employee's personal pension. The
pension charge represents the amounts payable by the Company to the fund in
respect of the year.
2. TURNOVER
The turnover and loss before tax are attributable to the one principal
activity of the Group which is the supply of products and services for the
disabled community.
An analysis of turnover is given below:
Year ended Year ended
31 Dec 2005 31 Dec 2004
# #
United Kingdom 3,506,049 4,570,174
Overseas 18,793 61,365
------------------------------------
3,524,842 4,631,539
------------------------------------
3. OPERATING LOSS
Operating loss is stated after charging:
Year ended Year ended
31 Dec 2005 31 Dec 2004
# #
Amortisation
- charged in the period 129,768 122,822
Impairment 2,036,014 -
Depreciation 125,213 92,413
Auditors' remuneration
- as auditors 15,000 17,745
- for other services 2,850 2,850
Director recruitment and compensation for loss of office - 45,000
Loss on disposal of fixed assets 50,462 -
Reorganisation costs 190,035 -
------------------------------------
During the year costs of #190,035 were incurred in the reorganisation
of the group. These costs related to the exiting of the wholesale and franchisee
market and the rationalisation of the retail portfolio of the Group.
4. PARTICULARS OF EMPLOYEES
The average number of staff employed by the group during the financial
period amounted to:
Year ended Year ended
31 Dec 2005 31 Dec 2004
Number Number
Administrative 16 16
Sales and retail 33 33
Support 5 -
Website development 1 1
Directors 2 2
------------------------------------
57 52
------------------------------------
The aggregate payroll costs of the above were:
Year ended Year ended
31 Dec 2005 31 Dec 2004
# #
Wages and salaries 1,010,833 965,867
Social security costs 93,254 76,066
Other pension costs 20,000 20,000
------------------------------------
1,124,087 1,061,933
------------------------------------
5. DIRECTORS' EMOLUMENTS
The Directors' aggregate emoluments in respect of qualifying services were:
Year ended Year ended
31 Dec 2005 31 Dec 2004
# #
Emoluments receivable 173,925 162,852
Compensation for loss of office - 30,000
Fees paid to non-executive directors 19,500 19,500
Group pension contributions to money purchase pension schemes 20,000 20,000
-------------------------------
Emoluments receivable 213,425 232,352
-------------------------------
During the year retirement benefits were accruing to 1 director (2004 - 1) in
respect of money purchase pension schemes
Remuneration of highest paid director Year ended Year ended
31 Dec 2005 31 Dec 2004
# #
Emoluments receivable 113,925 105,542
Company pension contributions to money purchase pension schemes 20,000 20,000
-------------------------------
Total emoluments 133,925 125,542
-------------------------------
6. TAX ON LOSS ON ORDINARY ACTIVITIES
Year ended Year ended
31 Dec 2005 31 Dec 2004
Current tax: # #
UK Corporation tax based on the results for the period at 19% - -
Adjustments in respect of prior periods - 737
-------------------------------
- 737
-------------------------------
Factors affecting current tax charge
The tax assessed on the loss on ordinary activities for the year is
higher than the standard rate of corporation tax in the UK of 19%.
2005 2004
# #
Loss on ordinary activities before tax (3,077,414) (202,134)
-------------------------------
Tax on loss on ordinary activities at 19% (584,709) (38,405)
Expenses not deductible for tax purposes 412,749 28,367
Differences between capital allowances and depreciation 27,586 13,474
Utilisation of losses brought forward (13,827) (13,568)
Losses of year carried forward 158,201 10,564
Marginal tax rate differences - (432)
-------------------------------
- -
-------------------------------
Deferred tax
There are Group losses of approximately #1,366,000 (2004 - #628,000)
carried forward. A deferred tax asset has not been recognised in respect of
these losses due to the uncertainty over the future utilisation of these losses
against suitable future profits.
7. LOSS ATTRIBUTABLE TO MEMBERS OF THE PARENT COMPANY
The loss dealt with in the accounts of the parent company was #3,672,505 (2004 -
profit of #73,821). This loss was made after a write down of investment value of
#2,877,213.
8. LOSS PER SHARE
The calculation of basic and diluted earnings per share on the loss of
#3,077,414 (2004 - #202,871) and a weighted average number of ordinary shares in
issue during the period of 47,850,020 (2004 - 35,885,539).
The loss attributable to ordinary shareholders and weighted average
number of ordinary shares for the purpose of calculating the diluted earnings
per ordinary share are identical to those used for basic earnings per ordinary
share. This is because the exercise of share options would have the affect of
reducing the loss per ordinary share and is, therefore, not dilutive under the
terms of FRS 14.
9. INTANGIBLE FIXED ASSETS
Group Goodwill Domain name Total
Cost # # #
At 1 January 2005 3,939,330 21,000 3,960,330
Additions 100,000 - 100,000
------------------------------------------------
At 31 December 2005 4,039,330 21,000 4,060,330
Amortisation
At 1 January 2005 1,776,884 21,000 1,797,884
Charge for the period 129,768 - 129,768
Impairment 2,036,014 - 2,036,014
------------------------------------------------
At 31 December 2005 3,942,666 21,000 3,963,666
Net book value
At 31 December 2005 96,664 - 96,664
------------------------------------------------
At 31 December 2004 2,162,446 - 2,162,446
------------------------------------------------
The goodwill brought forward represents the excess of fair value of
consideration paid for the acquisition of subsidiary companies in 2002 over the
fair value of assets acquired. An impairment review was undertaken and an
appropriate charge has been made to reduce the carrying value of goodwill.
The Group acquired trade and assets for the sum of #210,000 during the
year. The fair value of the stock and fixtures and fittings acquired was
#110,000, which gave rise to goodwill of #100,000.
10. TANGIBLE FIXED ASSETS
Plant, office Retail
equipment and store Motor
website fittings vehicles Total
Group # # # #
Cost
At 1 January 2005 450,783 225,001 84,928 760,712
Additions 237,767 23,906 - 261,673
Disposals (19,560) (43,709) - (63,269)
---------------------------------------------------------------------
31 December 2005 668,990 205,198 84,928 959,116
Depreciation
At 1 January 2005 296,034 49,521 61,170 406,725
Charge for the period 67,052 49,503 8,658 125,213
Disposals (1,038) (11,769) - (12,807)
---------------------------------------------------------------------
31 December 2005 362,048 87,255 69,828 519,131
Net book value
31 December 2005 306,942 117,943 15,100 439,985
---------------------------------------------------------------------
31 December 2004 154,749 175,480 23,758 353,987
---------------------------------------------------------------------
Hire purchase agreements
Included within the net book value of #439,985 (2004 - #353,987) is
#215,109 (2004 - 92,766) relating to assets held under hire purchase agreements.
The depreciation charged to the accounts in the year in respect of such assets
is #31,949 (2004 - #657).
11. INVESTMENTS
Total
Company #
Cost
At 31 December 2004 and 2005 6,361,026
Provision
At 1 January 2005 2,820,103
Charge for year 2,877,213
----------
At 31 December 2005 5,697,316
Net book value
At 31 December 2005 663,710
----------
At 31 December 2004 3,540,923
----------
Details of subsidiary undertakings at the balance sheet date are as follows:
Name of company Country of Class of Nature of business Proportion of
incorporation share
Ortho-Kinetics (UK) Limited England Ordinary Supply of mobility products 100%
Scooter Mart Limited England Ordinary Dormant 100%
Scootermart Mobility Centres Supply of mobility products to
Limited England Ordinary franchised retail outlets 100%
Youreable Limited England Ordinary Creation and maintenance of a
website for the disabled 100%
The Mobility Group Limited England Ordinary Dormant 100%
Cascade Ventures Limited England Ordinary Dormant 100%
12. STOCKS
2005 2004
Group Company Group Company
# # # #
Goods for resale 722,129 - 839,792 -
----------------------------------------------------------
13. DEBTORS
2005 2004
Group Company Group Company
# # # #
Trade debtors 263,539 - 548,384 -
Amounts owed by Group undertakings - 250,000 - 1,573,862
Other debtors 58,175 - 84,082 3,373
Payments and accrued income 58,822 - 76,702 1,417
----------------------------------------------------------
380,547 250,000 709,168 1,578,652
----------------------------------------------------------
The above debtors include the following amounts which fall due after one year:
2005 2004
Group Company Group Company
# # # #
Trade debtors 12,123 - 5,746 -
Amounts owed by Group undertakings - - - 1,327,859
----------------------------------------------------------
12,123 - 5,746 1,327,859
----------------------------------------------------------
14. CREDITORS: amounts falling due within one year
2005 2004
Group Company Group Company
# # # #
Bank loans and overdrafts - 470 - 21,919
Hire purchase agreements 65,134 - 29,111 -
Trade creditors 219,271 - 410,531 23,371
Amounts owed to Group undertakings - - - 440,106
Social security and other taxes 25,746 - 28,518 6,596
Other creditors 1,535 - 8,408 -
Accruals and deferred income 176,847 - 137,649 41,838
----------------------------------------------------------
488,533 470 614,217 533,830
----------------------------------------------------------
15. CREDITORS: amounts falling due after more than one year
2005 2004
Group Company Group Company
# # # #
Hire purchase agreements 137,309 - 63,312 -
----------------------------------------------------------
16. COMMITMENTS UNDER HIRE PURCHASE AGREEMENTS
Future commitments under hire purchase agreements are as follows:
2005 2004
Group Company Group Company
# # # #
Amounts payable within 1 year 65,134 - 29,111 -
Amounts payable between 2 and 5 years 137,309 - 63,312 -
----------------------------------------------------------
202,443 - 92,423 -
----------------------------------------------------------
17. PROVISIONS
2005 2004
Group Company Group Company
# # # #
Additions 95,000 - - -
----------------------------------------------------------
The provision above relates to estimated future costs to be incurred
regarding 3 property leases. The provision is expected to unwind over the next
12 months.
18. COMMITMENTS UNDER OPERATING LEASES
At 31 December 2005 the Group had annual commitments under non-cancellable
operating leases as set out below:
2005 2004
Land and Other Land and Other
buildings buildings
Group # # # #
Operating leases which expire
Within 1 year 19,206 3,873 - -
Within 2 to 5 years 209,680 - 184,680 15,665
After more than 5 years 70,250 - - -
----------------------------------------------------------
19. SHARE CAPITAL
2005 2004
Authorised share capital: # #
50,000,000 ordinary shares on #0.05 each 2,500,000 2,500,000
-------------------------------
Allotted, called up and fully paid:
47,850,020 ordinary shares of #0.05 each 2,392,501 2,392,501
-------------------------------
The Group has an obligation under the warrant to Altium Capital Limited issued
on 26 July 2002 to issue up to a further 375,000 ordinary shares at an issue
price of 20p per ordinary share during the period 1 February 2003 to 1 February
2008. Directors' options are set out on page 4.
On 22 October 2003 under the Enterprise Management Incentive Scheme,
400,000 options were granted to two members of management. The options may have
been exercised at 12.5p between 22 October 2006 and 22 October 2013. However,
following the sale of the subsidiary companies on 30 March 2006, these options
lapsed.
20. RESERVES
Other Share Profit and
Reserves Premium Loss
Group account account
# # #
As at 1 January 2005 2,023,515 147,821 147,821
Retained loss for the period - - (3,077,414)
Transfer - goodwill amortisation and impairment (2,023,515) - 2,023,515
------------------------------------------
As at 31 December 2005 - 147,821 (1,218,444)
------------------------------------------
Company
As at 1 January 2005 2,317,500 147,821 (272,077)
Retained loss for the period - - (3,672,505)
Transfer - impairment of investments (2,317,500) - 2,317,500
------------------------------------------
As at 31 December 2005 - 147,821 (1,627,082)
------------------------------------------
The transfer between Group reserves represents the release from the merger
reserve of #2,023,515 (2004 - #122,822) corresponding to the amortisation of
goodwill in the year.
21. RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
2005 2004
Group Company Group Company
# # # #
(Loss)/profit for the financial period (3,077,414) (3,672,505) (202,871) 73,821
New equity share capital subscribed - - 725,000 725,000
Net premium on new share capital subscribed - - 109,498 109,498
--------------------------------------------------
(3,077,414) (3,672,505) 834,498 908,319
Opening shareholders' equity funds 4,399,292 4,585,745 3,767,665 3,677,426
--------------------------------------------------
Closing shareholders' equity funds 1,321,878 913,240 4,399,292 4,585,745
--------------------------------------------------
22. FINANCIAL INSTRUMENTS
The Group's financial instruments comprise cash and liquid resources that arise
directly from operations. The main purpose of the financial instruments is to
fund the Group's operations. As a matter of policy the Group does not trade in
financial instruments, nor does it enter into any derivative transactions.
The Group's operations have been financed to date through the use of the funds
raised on the placing of shares in August 2002 and October 2004. The Group has
not borrowed funds during the year.
The Directors have taken advantage of the exemption permitted by FRS 13 in not
disclosing short term debtors and creditors as financial assets and financial
liabilities in the notes below.
The main risk to the Group and the policies adopted by the directors to minimise
their effects on the Group are as follows:
Credit risk
The Directors believe that credit risk has been mitigated as debts are spread
over a large number of debtors. Due to the nature of the markets in which the
Group operates and especially within the retail sector, sales are made in cash,
which reduces the overall credit risk. However, where the Directors perceive a
high credit risk within the Group, steps are taken to reduce the risks.
Foreign currency risk
The Group's functional currently is sterling and all bank balances are held in
sterling accounts. Certain purchases are made from overseas suppliers who may be
paid in foreign currency. The number of transactions involved is not
significant. The Group incurs a minimal amount of costs in foreign currency.
The Directors therefore do not consider that foreign currency is a significant
issue for the Group.
Interest rate and liquidity risk
All of the Group's cash balances and short-term deposits are held in such a way
that enables the achievement of the correct balances between access to working
capital and a competitive rate of interest. The Directors constantly monitor
the working capital requirements of the Group and they are satisfied that the
Group has sufficient working capital to continue as a going concern for a period
of at least 12 months from the dates that the accounts are approved.
23. PENSION COMMITMENTS
The Company has made during the year, payments into an individual employee's
personal pension. The assets of the scheme are held separately from those of the
company in an independently administered fund. The pension cost charge
represents contributions payable by the Company to the fund and amounted to
#20,000 (2004 - #nil). Contributions totalling #3,333 (2004 - #nil) were payable
to the fund at the balance sheet date and are included in creditors.
24. CAPITAL COMMITMENTS
The amounts contracted at the year end but not provided were #nil (2004 -
#12,436)
25. CONTINGENT LIABILITY
There is an unlimited bank cross guarantee to cover the bank borrowings of all
Group members of Bright Futures Group plc. As at 31 December 2005, Bright
Futures Group plc had an overdraft of #470 (2004 - #21,919).
26. RELATED PARTY TRANSACTIONS
Ortho-Kinetics Sales Limited
During the year, the Group entered into transactions in the ordinary
course of business with Ortho-Kinetics Sales Limited, a company owned by Mr M
Dolan, a director of Bright Futures Group plc. The sales to Ortho-Kinetics Sales
Limited were #8,516 (2004 - #45,622); the balance at the year end was #2,150
(2004 - #8,419).
27. POST BALANCE SHEET EVENTS
On 30 March 2006 the Company completed the sale of all of its subsidiaries and
of certain of its assets and liabilities to Sussex Wellbeing Limited for a cash
consideration of #913,719. As a result of this disposal a write down in the
Company's investments has been recognised in the sum of #2,877,213 and the
goodwill on consolidation has been impaired by #2,036,014.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR SDAFMFSMSEDI
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