Starvest PLC
12 April 2007
Half-year report - six months ended 31 March 2007
Chairman's statement
Investment report
I am pleased to report a successful six months trading during which Starvest has
achieved excellent results from which it intends to declare a special dividend
of one penny per share to be paid on 20 June 2007.
Pre-tax profit of £749,000 on turnover of £956,000; this includes a gross
profit of £936,000 following the sale of part of the holding in African
Platinum plc.
Basic earnings of 1.41 pence per share; fully diluted earnings of 1.23
pence per share.
27% increase in the value of trade investments of £3.3m since 30 September
2006 to £15.4m at 31 March 2007.
Fully diluted underlying net asset value per share was 37.7 pence at 31
March 2007 when the Company's share price discount to net asset value was
29.7%.
All these values are based on mid-market closing prices on a fully diluted
pre tax basis.
Share price increase of 56% since 30 September 2006 from 17 pence to 26.5
pence.
31 March 2007 cash balance of £1.128m
Closing market capitalisation £9.7m.
Unrealised profits as at 31 March 2007 of £12.2m before tax, up from £8.9m
at 30 September 2006, a 37% increase.
Other matters of interest are:
To provide further cash for investment and in view of the significant share
price discount to net asset value, in November 2006 the Company arranged a
secured loan of £1m on commercial terms for a period of one year renewable.
The above facility has given the Company the resources to make further
investments as follows:
o Kefi Minerals plc - mineral exploration interests in Bulgaria and
Turkey;
o DTT plc - driver training and recruitment services to the road haulage
industry;
o Oracle Coalfields plc - coal mining in Pakistan;
o Red Rock Resources plc - mineral exploration in Australia and Zambia -
additional.
A significant development during the period concerns African Platinum plc
("Afplats") a company exploring for platinum group metals in Southern
Africa in which the Company invested £100,000 for 10m shares prior to the
company being admitted to AIM in May 2002. In addition, the Company
acquired warrants exercisable at 1p per share over a further 10m shares.
On 16 February 2007, Impala Platinum Holdings Limited ("Implats") announced
a recommended cash offer for the entire issued share capital of Afplats.
Having exercised all warrants and sold 10,750,000 Afplats shares at various
times in the past, on 16 February 2007 the Company held 9,250,000 Afplats
shares. Of these, the Company has sold a further 1,000,000 shares.
Assuming the offer will be successful, that the Company expects to receive
further cash of £4,537,500 in June 2007; after tax, this will provide
substantial cash resources for future investment including share buy-backs,
and dividends.
500,000 shares bought for treasury at 17 pence per share.
Starvest now holds investments in twenty-seven companies of which seventeen
are traded on AIM, nine on PLUS Markets and one on the Toronto exchange.
The companies are listed at the end of this report. The Board continues to
be most satisfied with progress in its portfolio of investments.
Starvest continues to receive new investment proposals from businesses, mainly
in the natural resources sector. Before a commitment is made, these are closely
evaluated to ensure that they accord with the Company's medium to long term
investment strategy.
Dividends and share buy-back
As Shareholders will be aware from previous statements, the Board has declared
an intention to pay a dividend as soon as adequate profits are available. Also,
the Board has taken authority to make purchases of the Company's shares, either
for cancellation or to be held in treasury.
On 16 January 2007 the Company purchased 500,000 of its own shares in the market
at a price of 17 pence per share. It remains the Company's intention to make
further purchases as profits and cash resources permit.
In addition, the Board has declared a special dividend at the rate of one penny
per share to be paid to Shareholders on the register at the close of business on
25 May 2007 with payment being made on 20 June 2007. This dividend represents a
yield of 3.77% based on the closing share price on 2 April 2007.
The Board will consider future dividends in the context of the resources and
investment opportunities available at the time.
Extraordinary general meeting
The Directors intend to call a general meeting of Members to be held on
Wednesday 23 May 2007 for the purpose of considering and if thought fit passing
an ordinary resolution to extend by five years to dates between 27 June 2012 and
14 February 2015 the time period during which directors may exercise their
options over the Company's Ordinary shares totalling 5,575,000, authority for
which was granted in part on 27 June 2002 and in part on 7 October 2004. A
formal notice will follow.
Further information
Those Shareholders who wish to receive electronic copies of regulatory
announcements are invited to register their email address on the home page of
the Company website: www.starvest.co.uk. Previous reports, quarterly updates
and announcements are available from the site.
Your Board continues to look to the future with optimism; we expect further
progress in the next quarter and plan to issue the Chairman's next update during
July 2007.
R Bruce Rowan
Chairman & Chief Executive
12 April 2007
Profit & Loss Account
6 months to 31 6 months to 31 Period 1 August
March 2007 January 2006 2005 to 30
September 2006
Unaudited Unaudited Audited
£,000 £,000 £,000
Operating income 956 203 1,699
Direct costs (55) (5) (97)
Gross profit 901 198 1,602
Administrative expenses (128) (146) (267)
Operating profit on ordinary activities 773 52 1,335
Interest receivable 9 - 7
Interest payable (33) (2) (4)
Profit on ordinary activities before taxation 749 50 1,338
Tax on profit on ordinary activities (225) (10) (400)
Profit on ordinary activities after taxation 524 40 938
Retained profit for the period 524 40 938
Earnings per share - see note 4
Basic 1.41 pence 0.11 pence 2.5 pence
Fully diluted 1.23 pence 0.09 pence 2.2 pence
Balance Sheet
6 months to 31 6 months to 31 Period ended
March 2007 January 2006 30 September
2006
Unaudited Unaudited Audited
£,000 £,000 £,000
Fixed assets 0 0 0
Current assets
Debtors 10 227 108
Trading investments - see note 2 3,590 2,289 3,083
Cash at bank and in hand 1,128 - -
4,728 2,516 3,191
Creditors - amounts falling due within one
year
Other creditors (1,653) (777) (554)
Net current assets 3,075 1,739 2,637
Total assets less current liabilities 3,075 1,739 2,637
Capital and reserves
Called up share capital 372 372 372
Share premium account 2,026 2,026 2,026
Profit and loss account 677 (659) 239
Equity shareholders' funds 3,075 1,739 2,637
Reconciliation of Movement in Shareholders' Funds
6 months to 31 6 months to 31 Period 1 August
March 2007 January 2006 2006 to 30
September 2006
Unaudited Unaudited Audited
£,000 £,000 £,000
Total recognised profits relating to the period 524 40 938
Purchase of own shares for Treasury - see note 3 (86) - -
Increase in shareholders' funds 438 40 938
Opening shareholders' funds 2,637 1,699 1,699
Closing shareholders' funds 3,075 1,739 2,637
Half-year report notes
1. Half-year report
The information relating to the six month periods to 31 March 2007 and 31
January 2006 is unaudited.
The information relating to the period ended 30 September 2006 is extracted from
the audited accounts of the Company which have been filed at Companies House and
on which the auditors issued an unqualified audit report.
2. Basis of accounting
The report has been prepared using accounting policies that are consistent with
those adopted by the Company in the statutory accounts for the fourteen month
period ended 30 September 2006, although the information does not constitute
statutory accounts within the meaning of section 240 of the Companies Act 1985.
The Company will report again for the full year to 30 September 2007.
With one exception, the Company's investments at 31 March 2007 are valued at the
lower of cost or mid market value. The exception relates to Concorde Oil & Gas
plc which, as a matter of prudence, has been valued at 50% against the closing
price on 24 November 2006 the date on which trading in the shares was suspended
at the request of the company.
3. Share buy back
On 16 January 2007, the Company bought 500,000 of its own shares at a price of
17 pence to be held in Treasury. Shareholders' funds were reduced by £85,851.
4. Earnings per share
6 months to 31 6 months to 31 Period 1 August
March 2007 January 2006 2006 to 30
September 2006
Unaudited Unaudited Audited
£,000 £,000 £,000
These have been calculated on a profit of: 524 40 938
The weighted average number of shares used was: 37,022,204 37,217,259 37,217,259
The weighted average number of shares and
outstanding options used was: 42,597,204 42,792,259 42,792,259
Basic profit per share: 1.41 pence 0.11 pence 2.5 pence
Fully diluted profit per share: 1.23 pence 0.09 pence 2.2 pence
Investment portfolio
Starvest now holds trade investments in the following companies:
Addworth plc Active capital investment company
www.addworth.co.uk
African Platinum plc Platinum group metals in Southern Africa
www.afplats.com
Agricola Resources plc Platinum and uranium exploration
www.agricolaresources.com
Belmore Resources (Holdings) plc Zinc exploration in Eire and Northern Ireland
www.belmoreresources.com
Beowulf Mining plc Gold and copper exploration in Sweden
www.beowulfmining.com
Black Rock Oil & Gas plc Oil and gas in Southern England, Colombia and
Australia
www.blackrockoil.com
Brazilian Diamonds Limited Diamond exploration in Brazil
www.braziliandiamonds.com
Carpathian Resources Limited Oil and gas exploration in Central Europe
www.carpathian.com.au
Concorde Oil & Gas plc Operational oil and gas projects in the Russian
Federation
The Core Business plc Personal care and beauty products
www.thecorebusiness co.uk
DTT plc Driver training and recruitment services to the
road haulage industry
www.drivertransporttraining.co.uk
Franchise Investment Strategies plc Franchise consultancy and investment
Franconia Minerals Corporation North American minerals
www.franconiaminerals.com
Fundy Minerals Limited Gold and base metal exploration in Canada and West
Africa
www.fundyminerals.com
Gippsland Limited Tantulum exploration in Egypt
www.gippslandltd.com.au
Greatland Gold plc Gold exploration in Western Australia and Tasmania
www.greatlandgold.com
Hidefield Gold plc Gold exploration in North and South America
www.hidefield.co.uk
India Star Energy plc Oil and gas investments
Kefi Minerals plc Mineral exploration in Bulgaria and Turkey
www.kefi-minerals.com
Matisse Holdings plc Cash shell
Myhome International plc Domestic services franchiser
www.myhomeplc.com
Oracle Coalfields plc Coal mining in Pakistan
www.oraclecoalfields.com
Red Rock Resources plc Iron ore and manganese exploration in Australia and
Zambia; uranium exploration in Malawi
www.rrrplc.com
Regency Mines plc Copper & nickel exploration in Australia and Papua
New Guinea
www.regency-mines.com
Sheba Exploration (UK) plc Gold exploration in Ethiopia
www.shebagold.com
St Helens Capital plc Corporate finance advisor
www.sthelenscapital.com
Sunrise Diamonds plc Diamond exploration in Finland
www.sunrisediamonds.com
Copies of this interim report are available free of charge by application in
writing to the Company Secretary at the Company's registered office, 123
Goldsworth Road, Woking, GU21 6LR, by email to email@starvest.co.uk or from the
Company's website at www.starvest.co.uk.
Enquiries to:
Bruce Rowan, Chairman, telephone 020 7486 3997 or
John Watkins, Finance Director, telephone 01483 771992 or to john@starvest.co.uk
Grant Thornton Corporate Finance
020 7383 5100
Gerry Beaney
Colin Aaronson
12 April 2007
End
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