Starvest PLC
13 February 2006
Starvest plc
Interim report - six months ended 31 January 2006
Chairman's statement
Investment report
I am pleased to report a successful six months trading during which Starvest has
achieved:
An increase in the net asset value to£16.5m at 31 January 2006.
The previous declared values were: £8.69m at 31 January 2005; £6.5m at 31
July 2005; £8.4m at 31 October 2005.
An increase in the fully diluted net asset value per share to 39.9 pence
at 31 January 2006.
The previous declared values per share were: 22 pence at 31 January 2005;
16.9 pence at 31 July 2005; 21.5 pence at 31 October 2005.
In percentage terms, these increases are 136% since 31 July 2005 and 86%
since 31 October 2005.
The Company's share price discount to net asset value was 62% at 31 January
2006.
All these values are based on mid-market closing prices on a fully diluted
pre tax basis.
A gross profit of £198,000 on turnover of £203,000 and a profit on
ordinary activities after overheads but before taxation of £50,000.
Unrealised profits as at 31 January 2006 of £14.4m before tax, up from
£7m at 31 January 2005, a 106% increase and up from £4.8m at 31 July 2005, a
200% increase.
Other matters of interest are:
Following the net asset value announcement made to the London Stock
Exchange on 1 February, on Friday 3 February 2006 the Starvest share price
closed at 21.25 pence per share representing a discount to net asset value
of 44.5%.
No dividend is proposed for the period, although the matter will be kept
under review for the future.
A new credit facility has enabled the Company to commit to three new
investments since the last quarterly update in November, making a total of
four during the half year as follows.
+ Concorde Oil & Gas plc joined OFEX in September 2005 having raised
£190,000 net of expenses to acquire operational oil and gas assets in
the Russian Federation. The IPO price was 0.75 pence per share; the 31
January 2006 closing price was 11 pence per share.
+ Fundy Minerals Limited, a Canadian company with an OFEX quote,
exploring for gold and base metals in Canada and West Africa.
+ Addworth plc, an AIM quoted 'active capital' investment company. It
has interests in Myhome International plc, Franchise Investment
Strategies plc and The Core Business plc, three companies in which
Starvest has interests, as well as other non-mineral exploration
businesses and thus represents a further diversification from the
natural resources sector in which Starvest has been primarily involved.
+ The Core Business plc is being sponsored by Addworth plc and plans to
raise funds for its personal care and beauty product business. It
intends to apply to join AIM in the near future.
In addition, Starvest has added to its investments in Regency Mines plc,
India Star Energy plc and Franchise Investment Strategies plc.
Starvest now holds investments in twenty-two companies of which twelve
are traded on AIM and nine on OFEX. The companies are listed on the back
coverpage of this report. The Board continues to be most satisfied with
progress.
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.
Extraordinary general meeting
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. Neither of these intentions can be
fulfilled so long as the Company's profit and loss account is in deficit as it
was at 31 July 2005 in the amount of £699,664; this deficit arose in the
Company's original business prior to becoming an investment company in January
2002.
By application to the High Court, it is possible to have the share premium
account which stands at £2,026,396 reduced thus creating a situation where the
deficit on the profit and loss account can be eliminated. This will enable the
Board to consider the payment of a dividend rather sooner than would otherwise
be the case. We expect that our Shareholders will welcome this development.
To this end, the Board has called an Extraordinary General Meeting of Members to
be held on Tuesday 14 March 2006.
Quarterly update
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.
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
May 2006.
R Bruce Rowan
Chairman & Chief Executive
13 February 2006
Consolidated Profit & Loss Accounts
6 months to 31 6 months to 31 Year ended
January 2006 January 2005 31 July 2005
Unaudited Unaudited Audited
£,000 £,000 £,000
Operating income 203 615 628
Direct costs (5) (17) (34)
-------- -------- ---------
Gross profit 198 598 594
Administrative
expenses (146) (132) (205)
-------- -------- ---------
Operating
profit on
ordinary
activities 52 466 389
Interest
payable (2) - -
-------- -------- ---------
Profit on
ordinary
activities
before
taxation 50 466 389
Tax on profit
on ordinary
activities (10) (140) (85)
-------- -------- ---------
Profit on
ordinary
activities
after taxation 40 326 304
-------- -------- ---------
Retained
profit for the
period 40 326 304
-------- -------- ---------
---------
-------- -------- ---------
Profit per share - see note 3 0.11 pence 0.88 pence 0.82 pence
Basic 0.09 pence 0.82 pence 0.74 pence
Fully diluted
-------- -------- ---------
Consolidated Balance Sheet
6 months to 31 6 months to 31 Year ended
January 2006 January 2005 31 July 2005
Unaudited Unaudited Audited
£,000 £,000 £,000
Fixed assets 0 0 0
-------- -------- ---------
Current assets 227 36 51
Debtors 2,289 1,134 1,578
Trading
investments -
see note 2 - 744 194
Cash at bank and in hand
-------- -------- ---------
2,516 1,914 1,823
-------- -------- ---------
Creditors -
amounts
falling due
within one
year (604) - -
Bank overdraft (173) (193) (124)
Other creditors
-------- -------- ---------
Net current
assets 1,739 1,721 1,699
-------- -------- ---------
Total assets
less current
liabilities 1,739 1,721 1,699
-------- -------- ---------
Capital and
reserves 372 372 372
Called up
share capital 2,027 2,027 2,027
Share premium
account 424 424 424
Merger
reserves (1,084) (1,102) (1,124)
Profit and loss account
-------- -------- ---------
Equity
shareholders'
funds 1,739 1,721 1,699
-------- -------- ---------
Reconciliation of Movement in Shareholders' Funds
6 months to 31 6 months to 31 Year ended
January 2006 January 2005 31 July 2005
Unaudited Unaudited Audited
£,000 £,000 £,000
Total
recognised
profits
relating to
the period 40 326 304
-------- -------- ---------
Increase in
shareholders'
funds 40 326 304
Opening
shareholders'
funds 1,699 1,395 1,395
-------- -------- ---------
Closing
shareholders'
funds 1,739 1,721 1,699
-------- -------- ---------
Interim report notes
1. Interim report
The information relating to the six month periods to 31 January 2006 and 31
January 2005 is unaudited.
The information relating to the year ended 31 July 2005 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 in the statutory accounts for the year ended 31 July 2005 by the
Group and its subsidiary undertakings, although the information does not
constitute statutory accounts within the meaning of section 240 of the Companies
Act 1985.
The consolidated financial statements have been prepared using merger
accounting. Under merger accounting the results and cash flows are combined from
the beginning of the financial period and all comparatives are stated on the
combined basis. These interim financial statements consolidate the financial
statements of the Company and its subsidiaries.
The Company and Group will report again for the full year to 31 July 2006.
The Group's investments at 31 January 2006 are valued at the lower of cost or
mid market value.
3. Profit per share
6 months to 31 6 months to 31 Year ended
January 2006 January 2005 31 July 2005
Unaudited Unaudited Audited
£,000 £,000 £,000
These have been
calculated on
a profit of: 40 326 304
-------- -------- ---------
The weighted
average number
of shares used
was: 37,217,259 37,217,259 37,217,259
The weighted
average number
of shares and
outstanding
options used
was: 42,792,259 39,817,259 41,178,423
-------- -------- ---------
Basic profit per share: 0.11 pence 0.88 pence 0.82 pence
Fully diluted profit per share: 0.09 pence 0.82 pence 0.74 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 Zinc exploration in Eire and Northern Ireland
(Holdings) plc
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 Diamond exploration in Brazil
Limited
www.braziliandiamonds.com
Carpathian Resources Oil and gas exploration in Central Europe
Limited
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
Franchise Investment Franchise consultancy and investment
Strategies plc
www.fisplc.com
Franconia Minerals North American minerals
Corporation
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
Hidefield Gold plc Gold exploration in North and South America
www.hidefield.co.uk
India Star Energy plc Oil and gas investments
Matisse Holdings plc Cash shell
Myhome International plc Domestic cleaning services
www.myhomeplc.com
Red Rock Resources plc Iron ore and manganese exploration in
Australia
www.rrrplc.com
Regency Mines plc Copper & nickel exploration in Australia
www.regency-mines.com
Sheba Exploration (UK) Gold exploration in Ethiopia
plc
www.shebagold.com
St Helens Capital plc Corporate finance advisor
www.sthelenscapital.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: 020 7486 3997 or John Watkins: 01483 771992.
This information is provided by RNS
The company news service from the London Stock Exchange